FLC & Associates

                                                    Accounting Firm and Business Consultant

Foreign direct investments, Roxas said, increased by 26 percent to P6.3 billion from P5 billion last year while Filipino investors committed to pour in P5.9 billion or a 35 percent increase from the P4 billion infused over the same period in review last year.

Ninety-one percent of the investments were coursed through the Board of Investments (P7.5 billion) and Philippine Economic Zone Authority (P3.6 billion), both agencies chaired by Roxas while the rest were approved by Subic Bay Metropolitan Authority (P0.4 billion) and Clark Development Corporation (P0.6 billion).

The IT-related activities remained a major source of investments and drew P2.6 billion worth of pledged projects in telecommunications (P1 billion), production of parts and accessories (P.9 billion) and IT-related services (P.7 billion).

The investments channeled to IT-related activities represent a 240 percent increase from the P700 million posted last year. IT also accounted for 40 percent of total FDI in the first quarter.

"The increase in Filipino and foreign investments renders a positive economic outlook as it could mean creating additional job opportunities for our ever growing labor force," Roxas said.

Roxas noted that the latest NSO unemployment figures show that the number of unemployed has dropped by 13.28% from 4.866 million in April last year to 4.22 million for the same month this year. "Despite this improvement, we cannot afford to be complacent because there are simply many more Filipinos who are looking for jobs," Roxas said.

However, Roxas added that securing investments for the country needs certainty and predictability. "We have to compete with other Asian nations like China for investments in the manufacturing sector and in the case of IT-related ventures, with India," he pointed out.

Also according to Roxas, one way to sustain the steady flow of investments to the country is to focus the country's promotional efforts on specific industries. "This strategy is working out well in our efforts to promote the country as a hub not only for IT-enabled services but also an export production base for leading car manufacturers which want to secure their market foothold in the region," Roxas said.

"In the auto sector, we have been successful in generating renewed interest among the big manufacturers to use the Philippines as their export production base," Roxas said. The announcement of the new Motor Vehicle Development Program has caught their attention. This is also the reason government pressed for shift from engine displacement-based excise taxation currently being imposed on the automotive industry to a simpler and more transparent value based taxation.

"Once the needed law is passed, it would be easier to convince car manufacturers to expand their operations to include exports of completely built units to other countries. By promoting CBU exports, we can create a viable market base for our car manufacturers, enhance the sustainability of their operations and secure the hundreds of thousands of workers who depend on the industry for their living," Roxas said.

Ninety-five percent of approved investments were earmarked for the following industries: manufacturing (40 percent or P4.9 billion), gas and power (38 percent or P4.6 billion), services (17 percent or P2.1 billion). Other sectors or industries that drew investment commitments were real estate (P237 million), cargo storage (P124 million), trade (P75 million), agriculture (P64 million), transportation (P28 million) and communications (P0.4 million).

The gas and electricity sector drew a single investment, the renewable energy project of Victorias Bioenergy, Inc. in Negros Occidental which will aim to address the projected severe power supply shortage in the region in the next few years. The project is a joint venture between British and Filipino investors.

The United Kingdom emerged the biggest foreign investor, committing P1.9 billion followed by Japan (P1.8 billion) and the United States (P1.6 billion).

Considering that the approved investments are capital-intensive, such are projected to generate a total of 20,613 jobs or a 63 percent decrease from last year. FDI accounted for 67 percent of the total projected employment for approved projects during the quarter in review.