91% of PEZA manufacturing now operational

Published September 24, 2020, 6:00 AM

by Bernie Cahiles-Magkilat

Majority or 91 percent of manufacturing firms and 77 percent of IT-BPOs operating in the various economic zones nationwide are back to their operations enabling more than 1.181 million employees to go back to work again after 6 months of work disruption.

Philippine Economic Zone Authority Director General Charito B. Plaza. (Photo credit from Corporate Communications Division Philippine Economic Zone Authority)

Charito B. Plaza, director general of the Philippine Economic Zone Authority, reported that in the September 2020 status of operations of PEZA-registered companies, a total of 2,634 companies or 85% are now operating nationwide. Continued operations have allowed 1,181,115 workers or 76% of the workforce to work even under skeletal or work-from-home arrangements. 

Among the companies, 77 percent of the IT-BPO sector are now operating while in the manufacturing sector, 91 percent are already operational. 

The September 2020 PEZA operations status report was part of the letter that Plaza submitted to Senator Pia Cayetano, Chair of the Committee on Ways and Means of the Senate, and copy furnished all Senators of the 18th Congress and all Congressmen members of the Ways and Means Committee, as the agency once more appealed for the Senate to maintain a status quo on the PEZA incentives regime by excluding them from the  Corporate Recovery and Tax Incentives for Enterprises Act, most commonly known as CREATE bill still pending in the Senate.

PEZA has maintained its recommendation that CREATE should be implemented first for the domestic enterprises as they will benefit the most from the reduction of the corporate income tax (25% from 30) and enjoy for the first time incentives in rationalized manner. This will in turn maximize the micro, small, and medium enterprises (MSMEs) production, manufacturing export capabilities, complete supply chain, and encourage exporters to minimize import dependence. 

“We have to empower, capacitate, and enrich economically first the LGUs, our farmers, MSMEs, and our people in general to contribute in enhancing our idle land assets and available rich natural resources,” said Plaza.   

The PEZA Chief added, “We must think globally while acting locally, continuing to contribute in the global supply chain while establishing an economy that is production- and export-driven rather than forever an import- and consumption-dependent economy.”   

In the context of global pandemic, PEZA has reiterated its appeal to Congress for the retention and enhancement of the current fiscal incentives and add non-fiscal incentives. 

“The disastrous effects of the pandemic to our economy supports the position of PEZA all along for the continued grant of incentives under Republic Act No. 7916, as amended and at the same time its further enhancement to make the country more competitive, to keep the existing investors and to attract more foreign investments,” explained Plaza. 

Plaza noted that “The current fiscal incentives of PEZA are proven as globally competitive, tested, and tried to continually attract exporters and ecozone developers over the years. These incentives in fact compensates the high cost of doing business in the Philippines. With the global pandemic, we need to do enhance our incentives to make it more attractive for getting investors who are moving out of other countries like China.”