Surge in investment in the Philippines shows return of investor's confidence

As a clear indication of the return of investor's confidence in the Philippines, the country's top two investment promotion agencies - the Board of Investments (BOI) and the Philippine Economic Zone Authority (PEZA) - have reported an aggregate of P259.94 billion ($6 billion) worth of investments in the first five months of this year.

The figure is 189 percent higher compared to the P90 billion ($2.07 billion) approved investments generated in the same period of last year.

The BOI figure showed a staggering increase of 338 percent, from P43.65 billion ($1 billion) for the first five months of last year to P191.35 billion ($4.41 billion) for the same period of this year. PEZA, on the other hand, was able to increase investments by 48 percent, from P46.35 billion ($1.07 billion) to $68.59 billion ($1.58 billion) during the five-month period.

Earlier, the Bangko Sentral ng Pilipinas (BSP), the country's central bank, also reported that the Philippines continues to attract foreign investments, with foreign portfolio investments posting a $2.3 billion net inflow as of June 18 this year.

Data released by the BSP showed recently, the net inflow of " hot money," a term used to describe portfolio investments because of the speed that it can be poured and taken out of the economy, was more than thrice the $696.52 million in the same period in 2010.

Total inflows of foreign capital into the country as of June 18 amounted to $8.57 billion, more than twice the $4.08 billion last year, the BSP said.

But, according to the Department of Trade and Industry (DTI), the major sources of new investments were local investors with committed investments worth $224.57 billion ($5.18 billion), accounting for 86 percent of total investment approvals, while foreign investors contributed only $35.37 billion ($816 million) or a measly 14 percent. Officials said that the 390 approved projects are expected to create 74,266 additional jobs when fully operational, a 76 percent increase from last year' s 42,105.

A report by the state-owned Philippines News Agency (PNA) said that the manufacturing sector cornered the highest committed investments worth $120.79 billion ($2.79 billion), or a whopping 439 percent increase compared to the P22.41 billion ($517 million) posted in the same period last year.

One of the biggest projects to be undertaken this year is the modernization and conversion of the Bataan oil refinery of Petron Corporation, which is 99.47 percent Filipino-owned. Petron, which is an existing industry participant under the Downstream Oil Industry Deregulation Act of 1998, has infused new investments worth P74.78 billion in its Bataan project. Another notable project is New Carcar Manufacturing, Inc. (100 percent Filipino- owned), a new producer of steel billet, which has committed P10.57 billion ($244 million) worth of investments. The company's production facilities are proposed to be located in La Union, Cebu, Panabo City and Davao del Norte.

The electricity, gas, steam and air conditioning supply sector, which came in second with investments amounting to P70.17 billion ($1.62 billion), doubling the amount of investments for last year, remains bullish, garnering a 27 percent share of total investment approvals in the first five months of 2011.

The real estate activities sector also generated P51.77 billion ($1.19 billion) worth of investments in the first five months of 2011, posting an increase of 92 percent over last year's same period.

But it was the administrative support and service activities sector that posted the highest increase in investment approvals of 6,457 percent to P5.55 billion ($4.9 million). Accommodation and food service activities sector also posted a positive increase of 122 percent to P3.21 billion ($74 million).

Meanwhile, the implementation of the public-private partnership (PPP) program, a flagship project of President Benigno Aquino III, has hit another snag.

Newly-designated Transportation and Communications Secretary Mar Roxas said that he still would like to study first the bidding of the contract to operate Metro Manila's two railway systems - Light Rail Transit (LRT) 1 and Metro Rail Transit (MRT) 3 - which was scheduled on July 11.

Roxas said that the postponement of the first PPP bidding, which was ordered by his predecessor in the DOTC, was okay with him.

According to Roxas "I am comfortable with the postponement because I am not yet fully up to speed on it. It's a P15-billion ($346 million) project, mostly outflow, so we need to be very careful and sure about this.

President Aquino also said that 10 PPP projects would be bid out this year (2011).

 

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Singapore business investors visits Philippines for investments opportunities

Three months after President Benigno Aquino's investment promotion trip to Singapore, a Singapore business delegation is visiting the Philippines to explore business opportunities in the country.

The 40 top executives from 28 companies in Singapore are in the Philippines to explore trade and investment opportunities with the Philippine government and the private sector.

Aside from the business matching opportunities between various Singapore and Philippine companies engaged in housing and resort development, agribusiness, logistics, maritime and offshore engineering, and renewable energy, businessmen from Singapore were also able to get a first-hand update on the recent developments in the Philippine economy under President Aquino, a year after he took office.

The Singapore business delegation expressed optimism about the Aquino administration's emphasis on transparency and good governance which is vital in attracting foreign investments to the country.

Choo Chiau Beng, co-chair of the Philippines-Singapore Business Council, said: "The last one year, we have seen improvements and we can see that the new administration is heading the right way. One of the key areas is...they have opened up the skies, which mean that more airlines can fly to tourist destinations and provincial cities.

"They have also enlisted the PPP programs to modernize and privatize four or five airports, and this are encouraging because ultimately, infrastructure is very important, and if you have the right infrastructure, and the right policy in government with regards to infrastructure, the others will flow naturally."

With Singapore being the Philippines' fifth largest source of foreign direct investments, the Aquino administration is hoping it can lure more Singapore companies to invest in the Philippines and help fuel its economic growth.

 

 

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Stands-up against the Dragon's Oil Rig in West Philippines' Sea- Spratlys

Filipino Americans, outraged at China’s plans to set up oil rigs in the Spratly Islands of the Philippines this July, are organizing protest actions in front of all the consular offices of the People’s Republic of China in the US at noon on July 8.

Xinhua News reported on May 24, 2011 that the China National Offshore Oil Corp (CNOOC) is deploying to the Philippine waters of the Spratlys its 31,000 ton “Marine Oil 981”, a giant deepwater oil drilling platform that carries out oil explorations up to a depth of 3,000 meters and is equipped with a drill that can go as deep as 12,000 meters.

Xinhua News quoted CNOOC Chairman Wang Yilin as declaring that “Marine Oil 981”, which costs $923 million to build over a three-year period, “will be a good opportunity to strengthen its efforts in deepwater oil exploration and ensure energy security” of China. Chairman Yilin promised that “the rig will be installed in the waters of the South China Sea and begin oil and gas prospecting in July 2011.”

Why is China in a rush to set up its oil rigs in the Spratlys?

In 2000, China represented only 6% of global oil demand but in the decade since then, it has accounted for nearly one-half of global oil demand growth and is now the largest vehicle market in the world. China has surpassed the United States as the world’s largest energy consumer.

To meet China’s insatiable demand for oil, Xinhua News reported that “CNOOC plans to invest 200 billion yuan ($30 billion) and drill 800 deepwater wells – which they expect to have an output of an equivalent 500 million barrels of oil by the year 2020.” This target production is equivalent to approximately $50 Billion USD per year.

China had previously assured the Association of South East Asian Nations (ASEAN) in 2002 that it was willing to resolve sovereignty disputes peacefully through negotiations. But now, because of its massive energy needs and because it has determined that the Spratly Islands hold sufficient quantities of oil and natural gas deposits to meet its energy needs, China has changed its tune. In March 2010, China unilaterally declared the entire South China Sea a “core national interest” similar to its claims to Tibet and Taiwan and therefore “non-negotiable”.

China does not recognize the Philippine claim to the Spratly Islands which is based on the fact that the islands lie only 125 miles from the Philippine province of Palawan and, according to the United Nations Convention on the Law of the Seas, a nation owns the oil, mineral and other resources within a two hundred mile radius from its base. In contrast, China is 585 miles away.

China’s claim is based on an old map drafted during the Han dynasty in 110 AD which referred to the Spratlys as the Nansha islands and part of the Middle Kingdom. The Philippine islands, known then as the Mayi islands, were also a part of China in the same map. If the Spratlys could be annexed because of a 2000 year old map, then could the Philippines  or (Mayi islands for china) be next?

The concern about the hegemonic moves of China in the Spratlys was heightened by the recent disclosure of Philippine Foreign Affairs Secretary Albert del Rosario that Chinese warships had intruded in Philippine territory on at least 9 occasions in the last few months.

These provocative activities, together with news of China’s deployment in Philippine waters of its giant oil rig, prompted Loida Nicolas Lewis, chair of US Pinoys for Good Governance, to call on the global Filipino community to “stand up to the Chinese bully” and demonstrate in front of Chinese consulates and embassies throughout the world on July 8.

A Filipino community town hall meeting to discuss this issue is set for Wednesday, July 6, at 6PM at the Philippine Consulate at 447 Sutter Street in San Francisco.

For more information, log on to epeoplepower.ph.

Please send your comments to Rodel50@gmail.com or mail them to the Law Offices of Rodel Rodis at 2429 Ocean Avenue, San Francisco, CA 94127 or call (415) 334.7800.

Filipinos around the Globe will rise up the highest protest against China’s Invasion

We call all Filipinos, OFW’s, ASEAN neighbors who are directly affected; Vietnam, Indonesia, Malaysia, & Brunei to join our cause. We also call the support of other ASEAN neighbors and friends who are indirectly affected to be with us; Singapore, Thailand, Laos, Cambodia, Myanmar, USA, European Union, Australia, Canada, India, Japan, New Zealand, South Korea, and Russia.

We are in need of several Volunteers to lead for each and every country around the world. Be interested to solve this disputes as it will not just affects the surrounding countries but also around the world when the tension will rise up to a dangerous war. We will team up with  Volunteers who want to lead the global protests and Volunteers to get involved in the international negotiation to solve the disputes. For more information contact:

Prince

Spratlys - Global Coordinating Network (SGCN)

Email: prince@highkot.com

 

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