Manufacturing, Construction and Real Estate Seen To Fuel 2015 Investments
Manufacturing, infrastructure/construction and the real estate sectors are going to drive investments growth in the country this year that could possibly reverse the decline in 2014 investment performance, which was led by energy projects.
Trade and Industry Undersecretary Adrian S. Cristobal Jr., who is also managing head of the Board of Investments (BOI) told reporters he does not expect power projects to register this year anymore since the approved power projects could already assure of sufficient power capacity in the coming years, but rather the investment landscape would be driven by the manufacturing sector.
“We will continue to see the resurgence in manufacturing. We expect that to continue this year,” Cristobal said.
He said that even the Philippine Economic Zone Authority (PEZA) has been experiencing strong growth in manufacturing projects.
“Growth in manufacturing sector is driven by the country’s competitiveness as an investment destination,” he said.
In 2014, the manufacturing sector posted the biggest sectoral improvement at triple-digit growth.
Aside from manufacturing, Cristobal said construction and the real estate sectors will contribute to the country’s investment inflow in 2015.
Projects under the Public-Private Partnership (PPP) program of the government, which are mostly huge infrastructure projects, are registrable with the BOI.
“We have approved 2-3 PPP projects last year so we expect to approve more this year,” said Cristobal adding this may include the huge CALAX and other railway projects.
With most of the PPP projects being put on the block and implemented, the BOI expects the registration of infrastructure projects to pick up this year.
The strong demand for housing will also fuel continued growth in the real estate sector. In addition, the IT-BPO sector continues its growth.
“As long as the IT-BPO sector keeps growing, we expect also the other sectors including the retail sector to grow,” he added.
Cristobal, however, refused to set investments growth target for this year. But based on the Philippine Development Plan, the combined PEZA and BOI investments should grow 10 percent on an annual basis.
For 2015, the PDP said both agencies have combined investments goal of P869.3 billion (BOI with P540.2 billion and PEZA with P329.2 billion) and by 2016 at P956.3 billion (BOI with P594.2 billion and PEZA with P362.1 billion).
For 2014, both BOI and PEZA were supposed to generate P790.3 billion of which the BOI was expected to generate P491.1 billion and PEZA, P299.3 billion.
But BOI investment pledges in 2014 plunged by 24 percent to P353.5 billion only from P466.03 billion in 2013 with power projects accounting for almost half of the approved projects followed by construction and mass housing.
According to the BOI, the electricity, gas, steam and air conditioning supply sector continued to rake in the biggest share of total investments with P174.7 billion, the construction sector with P64 billion and real estate or mass housing projects with P47.7 billion.
Notably, the manufacturing sector, which landed fourth biggest contributor, was the most improved sector.
The BOI noted that the 2014 investments in the manufacturing sector reached P24.5 billion surged by 77.5 billion from last year’s P13.8 billion on higher investments in basic metals (6,651%), beverages (802%), electrical equipment (320%), rubber and plastic products (281%), and motor vehicles (269%). Other subsectors with increased investment approvals are in textiles (100%), paper and paper products (100%), and other non-metallic mineral products (100%).
Source: http://www.mb.com.ph/manufacturing-construction-and-real-estate-seen-to-fuel-2015-investments/ by Bernie Magkilat January 6, 2015
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