As the country makes significant strides toward becoming one of the top investment destinations in the region, the Philippine Economic Zone Authority (PEZA) reported a strong investment performance for 2024, achieving double-digit growth in approved investments compared to the previous year.

As of 20 December, PEZA’s approved investments reached P214.176 billion — a 21.89 percent increase compared to P175.709 billion in 2023.

Following the 17 December board meeting at the Manila Hotel, PEZA director general Tereso Panga underlined the importance of partnerships and strategic ecozone initiatives in achieving this milestone.

“Our success demonstrates investors’ trust in PEZA as a hub for innovation and economic growth. We remain committed to providing the best incentives and infrastructure to attract more high-value investments,” the PEZA chief said.

In December alone, the PEZA board, headed by chairperson and Trade and Industry Secretary Ma. Cristina Roque, approved 16 new and expansion projects that are expected to generate P12.625 billion in investments, $782.438 million in exports, and 1,113 direct jobs.

The approved 16 ecozone projects comprise eight export manufacturing, one IT-BPM project, three facilities development initiatives, two domestic market projects, and two ecozone developments.

One of these projects is based in Metro Manila while the rest are distributed across the CALABARZON, Central Luzon and SOCCSKSARGEN regions.

Strong full-year performance

The 16 approved projects completed the 255 projects approved for the year, reflecting a 9.44 percent growth in project approvals as compared to 233 projects in 2023.

The approvals are projected to contribute over $4.656 billion in exports and generate more than 72,000 new direct jobs — a 16.35 percent increase in export value and a staggering 78.82 percent surge in employment year-on-year.

The new projects include 122 export manufacturing, 65 in IT-BPM, 27 in ecozone development, 18 facilities development, 12 domestic markets, nine logistics and two utility projects.

In terms of industries, the top-performing sectors were manufacturing, IT services and transportation.

Investments from key markets such as South Korea, Malaysia, Hong Kong, Thailand and Germany also surged. South Korea emerged as PEZA’s top investor, contributing P51.269 billion in investments for the year.

Likewise, 27 economic zones worth P9.175 billion have been proclaimed under President Marcos’ administration, with 16 new ecozones in 2024 alone.

The newly approved ecozones continue to be a cornerstone of PEZA’s strategy to attract foreign direct investments and foster industrial growth, in line with President Ferdinand R. Marcos Jr.’s goal to make the Philippines the premier investment destination in the region and accelerate countryside development through the ecozones.

FTA with Korea seen a key driver

In line with the DTI’s target countries, PEZA is prioritizing attracting more South Korean companies to locate in the ecozones with the ratification of the South Korea-Philippines Free Trade Agreement.

Set to be effective by 31 December 2024, the Philippines-South Korea FTA is poised to further boost South Korean investments in the Philippines.

PEZA is gearing up to leverage on the agreement to attract more South Korean companies, particularly in priority sectors such as electric vehicles (EVs), advanced manufacturing and sustainable energy solutions.

Ramping up domestic innovation and enhancing the ecosystem of EVs in the country, PEZA chief Panga expressed, “South Korea’s increasing investments reflect their confidence in the Philippines’ potential as a top destination in ecozone development and sustainable industries. With the FTA in place, we anticipate more partnerships with South Korea that will further stimulate economic growth.”

Among the latest EV-related investments is LCS Emon Commercial Corp, a domestic manufacturer with South Korean equity seeking to establish an EV assembly facility at the Lima Technology Center — SEZ in Batangas. The facility will produce and market electric jeepneys, mini-buses, and two- and three-wheeled EVs, fostering sustainability while bolstering auxiliary industries like EV maintenance and repair services.

Corporation also joined the roster of new South Korean PEZA-registered projects approved this year for the production of Multi-Layer Chip Capacitors (MLCC) for the automotive sector using cutting-edge technology in its Laguna facility.

Another South Korean company is Littlefuse Phils Inc. which will manufacture in Batangas electromechanical assemblies and harnesses, further strengthening the local supply chain with South Korean expertise.

Sustaining growth momentum

Given the positive projections for the Philippines in the coming years, director general Panga expressed confidence in maintaining PEZA’s growth trajectory, forecasting a 10 percent increase in investments for 2025 or about P235 billion.

In attaining this, PEZA plans to focus on attracting investments in a wider range of sectors, with electronics continuing to play a key role in driving the country’s export portfolio.

Other priority industries include EVs, smart manufacturing, data centers, food agro-processing, green ore mineral processing, renewable and alternative energy production, marine-based industries, and pharmaceutical ecozones.

The DTI and PEZA are also confident in attracting more foreign direct investments (FDIs) through a series of investment missions and joint effort engagements.

These initiatives aim to advance pivotal industries, including the pharmaceutical sector while strengthening partnerships with academic institutions and integrating MSMEs into the ecozone value chain.

PEZA is also leveraging on the newly passed CREATE MORE Act which makes the Philippines more competitive in the ASEAN given the most attractive tax and investment incentives offering.

This bodes well with the President’s bid to graduate the country to upper middle-income economy by 2025 and position the Philippines as an investment hub in the region.

The continuous upward trajectory of PEZA is in line with the administration’s aggressive investment attraction and facilitation and sound economic fundamentals.

PEZA is closely working with the DTI to further enhance its goals and reach its ecozone expansion targets for next year.