Investment pledges approved by the Philippine Economic Zone Authority (PEZA) in the first eight months this year reached P31.1 billion, boosted by Japanese investment contribution that account for the biggest share at 26 percent.
Philippine Economic Zone Authority (PEZA) OIC Deputy Director General Tereso O. Panga said as he expressed confidence of continued Japanese projects in the PEZA ecozones.
Panga said he gathered assurances of continued Japanese investments during recent meetings with the top executives of the Japanese Embassy in the Philippines, Japan External Trade Organization (JETRO), Japanese Chamber of Commerce and Industry of the Philippines, Inc. (JCCPI), Japan International Cooperation Agency (JICA), and Cavite Economic Zone Investors Association (CEZIA).
Currently, he said, Japanese investments account for 27.2 percent of total ecozone investments and has been steadily increasing.
For the January-August period this year alone, Japanese ecozone investments account for 26 percent share or P8 billion out of total P31.129 billion approved by PEZA. For the first seven months this year, Japanese firms exported a total of $10.215 billion with total employment of 350,486.
“Even amid pandemic and threat of global recession, we remain bullish that the Japanese will continue to be our number 1 investor in PEZA not only this year but for the many years to come,” he said.
“Japan has always been ichi-ban. Overall, Japan is among the country’s top trading partners and traditionally, it has been the Philippines’ largest foreign investor next to the United States,” he added.
To date, PEZA has registered 903 locator companies with Japanese equity generating a total investments of P735.9 billion and providing employment to 350,486 Filipinos.
He cited the latest JICA reports on Japanese manufacturing companies' investment outlook for the Philippines where the Philippines ranked no. 7 out of 20 promising countries/regions for overseas business over the medium-term based on the JBIC 2021 survey, and the Annual JICA Programs where the Philippines is the biggest recipient country in Southeast Asia for fiscal 2020 of JICA's grants, technical cooperation, and finance and investment cooperation.
By far, Japan is also the biggest donor of the Philippines. Through JICA, it has done a lot to improve the competitiveness of entrepreneurs and businesses, develop industrial and investment policies and business environment, and raise national incomes to enable the country achieve high quality and sustainable economic growth.
He said bright prospects for increased Japanese FDI inflows into the country and ecozones considering new ecozone development projects with Japanese equity in the First Philippine Industrial Park, Lima, West Cebu, and Yazaki-Torres, for presidential proclamation.
Panga also cited continuous expansion of existing Japanese ecozone locators particularly in the product-sectors of EMS and SMS, chemicals (oleo, activated carbon), automotive and automotive parts, computer and optical products, and transport and logistics.
In addition, he said, PEZA will soon approve/register four big ticket projects of Japanese industrial giants into multilayer ceramic capacitor, brushless DC motors, and biomass carbonization.
Moreover, Panga said that Japanese SMEs going global and upscaling of production through JICA's ODA program to link the developing countries with Japanese SMEs as an invaluable source of FDI, diverse technologies and expertise;
The Japanese government has also extended stimulus for Japanese manufacturing companies in China to shift their production to ASEAN.
As per the JBIC 2021 survey, the Japanese investors chose the Philippines as “base of export to Japan”, and received the most votes on “good performance of sales in the ASEAN region.”
Also the Japan Credit Rating Agency's (JCRA) recent A-level credit rating with a stable outlook on the Philippines, citing partly government measures to address the pandemic’s impact on the health system and the economy;
Panga also noted of Japan’s support and active involvement in several game-changing infrastructure projects of the government.
One thing that also attracts Japanese investors to PEZA is the agency’s one-stop shop service, attractive fiscal incentives under the CREATE regime, and 420 world-class and environment friendly ecozones, which continue to draw global industry leaders and export-oriented IT and manufacturing companies that account for 60 percent of the country's total annual commodity and service exports.