BOI-approved projects decline 36% last year

MANILA, Philippines — Projects approved by the Board of Investments (BOI) fell below target and declined by 36 percent from the 2020 level amid stricter restrictions imposed due to the pandemic.

In a statement yesterday, the BOI said there were P655.4 billion worth of investment approvals from 235 projects last year, lower than the agency’s P905-billion target and the P1.02 trillion approved in 2020.

BOI was initially aiming for P1.25 trillion worth of investment approvals last year.

The BOI said it did not reach its targeted investment pledges for 2021 due to the implementation of stricter travel protocols that affected investors’ timeline for finalizing studies, decisions and registrations.

“Because of the global surge in the Delta variant, and now with the emergence of the Omicron variant, these resulted in global setbacks in economic recovery, which then translated to the implementation of stricter protocols in the country. We were hit hard during the second quarter and the early part of the third quarter last year,” Trade Undersecretary and BOI managing head Ceferino Rodolfo said.

Foreign investments approved by the BOI surged 218 percent to P151.8 billion last year from P47.7 billion in 2020.

Meanwhile, domestic investments were down 48 percent to P503.6 billion from P970 billion in 2020.

Significant projects approved last year include the Makati City Subway project worth P81.1 billion and Calatagan Cement Plant worth P25 billion.

“Buoyed by 2021 FDI (foreign direct investment) results, as well as the healthy pipeline of strong investment leads both foreign and domestic, and with the reforms that we are anticipating to still be passed in the next months, we are confident of hitting P1 trillion in BOI-approved investments this year,” Trade Secretary and BOI chairman Ramon Lopez said.

Rodolfo said there is an upcoming large-scale telecommunication project amounting to P155 billion that is up for approval.

He said other projects in the pipeline include a new domestic shipping operator, new operator of electric vehicle charging stations, three new operators of telecommunications infrastructure, a new producer of animal feeds, and a cement manufacturer.

In terms of reforms, amendments to the Retail Trade Liberalization (RTL) Act, which was signed into law last month, and the proposed amendments to the Public Service Act (PSA) and Foreign Investment Act (FIA) are expected to boost foreign direct investments.

Republic Act 11595 or the amendments to the RTL Act of 2000 reduced the capitalization requirements for foreign retailers to around P25 million from $2.5 million or around P125 million.

Meanwhile, proposed amendments to the FIA of 1991 are expected to spur growth to the country’s economy and further foster a culture of cooperation among investment promotion agencies, while amendments to the PSA would allow 100 percent foreign ownership in telecommunications, air carriers, domestic shipping, railways and subways, and canals and irrigation sectors.