Rebooting The Philippine Economic Zone Authority Towards Building Green Industrial and Smart Cities A Presentation for the: WALLACE BUSINESS FORUM ROUND TABLE Peninsula Hotel, BGC, Makati City Peninsula Hotel, BGC, Makati City 7:00 AM, 26 October 2017 7:00 AM, 26 October 2017 1
Philippine Economic Zone Authority (PEZA) • Attached to the Department of Trade and Industry • Promotes Investments • Creates Employment • Generates Exports • Develops the Countryside • Brings about the Transfer of Technology • Utilizes and Makes Idle Lands Productive 376 Operating Economic Zones Nationwide 74 Industrial and Export Processing Zones 74 74 254 IT Parks and Centers 258 20 Tourism Ecozones 20 2 Medical Tourism Parks 2 22 Agro-Industrial Parks 22 As of July 2017 2
As of July 2017 1995 – 2016 3
COMPARATIVE INVESTMENTS JAN - SEPT 2016 / 2017 240 196.457 200 160 94.12 % 101.202 Growth 120 80 40 0 2017 2016 In Php Million INDUSTRY SECTOR JAN TO SEPT JAN TO SEPT % INCREASE/ 2016 2017 DECREASE Manufacturing 22,407.139 45,087.233 + 101.22% Information Technology 14,576.323 11,386.751 -21.88% Ecozone Development 61,677.516 123,718.194 + 100.59% Others 2,541.685 16,265.700 + 539.95% TOTAL 101,202.663 196,457.878 + 94.12% 4
1995 – 2016 5
Total Direct and Indirect Employment: (x 5 of total direct employment) 6,820,958 As of Aug 2017 22.19 % Filipino 28.02 % 15.45 % American Japanese 12.67 % Dutch 7.41 % British 3.72 % Korean 3.50 % Singaporean 1.60 % German 0.85 % Taiwanese 0.85 % Swiss 3.74 % Others 6
10.97 % Information Technology Services 8.81 % Metals/Fabricated Metal Products 7.96 % Tourism 37.17 % 5.84 % Transport (Shipbuilding, Aerospace, Electronics / Car Parts, Equipment) Semiconductors 4.71 % Electrical Machinery and Apparatus 2.15 % Medical, Precision and Optical Instruments 1.68 % Rubber and Plastic Products Medical Tourism 1.21 % 19.51 % Other Manufactures PE ZA’S GOAL AND MAJOR PROGRAMS 7
Industrialize the Philippines by building Green Economic Zones towards Industrial and SMART Cities 1. Build economic zones in every province and city • Creation of the Philippines Ecozones Map • Two (2) Public Economic Zones per Region • PEZA Investment Center in the regions in addition to the Main Investment Center in Pasay 8
TYPE S OF E CONOMIC ZONE S 9
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Addressing the Gaps to Improve Competencies, Hasten Industrialization and Minimize Import- Dependence 1. Completing the supply chain • Inviting Complementary Industries • Inviting Manufacturers of Industrial Machineries • Inviting Basic Industries Steel Industry, Processed Mineral, Bio-Fuel • Inviting Basic Crops Industries Rice Coffee Abaca Rubber Sugar Cacao Coconut Vegetable 14
2. Stability and low cost of Supply of Utilities • Power • Water • Telecommunication Services 3. Build more International Logistics Hubs and Centers in every region • Seaports • Airports • Transportation Facilities • Warehouses and Cold Storage 4. Enhance and transform the Filipino workforce into a World-Class Labor Force • PEZA Institute Trains manpower needs of industries • MOA with CHED, TESDA • Accreditation of Professional Services, Training Centers, Manpower Agencies and to ensure delivery of quality services and labor force 5. Additional Incentives and Stability of Policies and Laws; Exemption of Ecozones and Industries to the VAT Zero Rate under the Tax Reform Bill 15
Rights of Filipino Workers Protection of the Environment WHY PE ZA 16
Incentives 1. Income Tax Holiday (ITH) 6 to 8 years for pioneer project 4 to 6 years for non-pioneer project 2. After the ITH - Special 5% tax on gross income less allowable deductions in lieu of all national and local taxes Incentives 3. Tax and duty free importation of capital equipment, spare parts, supplies and raw materials 4. Domestic sales allowance of up to 30% of total sales 17
Incentives 5. Zero Value Added Tax (VAT) Rate on all local purchases directly related to its registered activity to include telecommunications, power and water bills 6. Exemption from payment of local government taxes and fees Incentives 7. Employment of foreign nationals 8. Special visa for foreign investors and immediate family members 9. Long-term land lease of up to 75 years 10. Unequalled service by PEZA 18
THE PE ZA BRAND OF SE RVICE FOR E ASE OF DOING BUSINE SS 1. PEZA is a One-Stop Shop • Building and Occupancy Permits • Import and Export Permits • Online Import and Export Procedures and E-Payment System 19
• Special multiple-entry non-immigrant Visa • Environment Clearance Certificate (MOA with DENR) • Exemption from Local Government Permits and Fees • Simplified registration process – electronic application available from website; forms downloadable 2. PEZA is a Non-Stop Shop • Provides 24 hours a day, 7 days a week of continuous service • The Director General and other top officials are on call 24 hours a day, 7 days a week 20
3. In PEZA, there is NO RED TAPE 3. In PEZA, there is ONLY RED CARPET TREATMENT 21
3. In PEZA, there is NO GRAFT NO CORRUPTION PEZA is ISO 9001:2008 Certified For all processes, at all levels, in all offices, nationwide. 22
IFC – World Bank cited only PEZA for Best Practice among Economic Zones worldwide “Under PEZA, the Philippines has shown dramatic improvements in Investment Climate. End Result – PEZA is a shining example of successful regulatory reform improving overall investment climate in the country.” TI Philippines Electronics American/Dutch Taganito HPAL Nickel Basic Metals Japanese Toshiba Information Electronics Japanese Tiger Resort Tourism American/Japan Sunpower Philippines Solar Cells American/Cayman Travellers International Tourism Filipino Sureste Properties Tourism Filipino Ibiden Philippines Electronics Japanese Amkor Technology Electronics Singapore/American Coral Bay Nickel Basic Metals Japanese 23
NXP Semiconductors Electronics Dutch Canon Business Electronics Japanese MCE Leisure Tourism British Virgin Epson Precision Electronics Japanese HGST Philippines Electronics Dutch/Japanese PASAR Basic Metals Filipino Rohm Electronics Electronics Singapore/Japan JT International Tobacco Dutch Toyota Autoparts Automotive Japanese Samsung Electronics Korean Toyota Autoparts Automotive Japanese St. Luke's Medical Tourism Filipino Tsuneishi Shipbuilding Japanese Integrated MicroElectronics Electronics British STMicroelectronics, Inc. Electronics Swiss Panasonic Precision Electronics Dutch/Japanese Lufthansa Technik Air Transport German American Power Electrical Machinery Dutch/American Continental Temic Electronics German TDK Philippines Electronics Japanese 24
Accenture, Inc. Info Technology Dutch Taiyo Yuden Electronics Japanese Pilipinas Kao Chemical Products Japanese Terumo Philippines Medical Instruments Japanese Nidec Philippines Electronics Japanese AG & P Fabricated Metals Filipino Teletech Info Technology American On Semiconductor Electronics American Analog Devices Electronics Dutch Green Future Agro-Industrial Japanese Brother Industries Electronics Japanese Xerox Business Info Technology Dutch JPMorgan Info Technology American Schweitzer-Mauduit Agro-Industrial American Convergys Philippines Info Technology Dutch/American House Technology Rubber/Plastic Singapore/Japan Funai Electric Electronics Japanese First Sumiden Electronics Japanese Smart Electronics Electronics Korean MJC Investments Tourism Filipino 25
Ionics EMS Electronics Filipino PV Tech Electrical Machinery Singaporean Cypress Manufacturing Electronics American Concentrix Daksh Info Technology Dutch Moog Controls Air Transport American Cavite Biofuel Agro-Industrial Filipino First Philec Electronics Filipino Telephilippines Info Technology Dutch Nidec Precision Electrical Machinery Japanese Tong Hsing Electronics Taiwanese 11 Italian Companies in PEZA Economic Zones 26
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