The Board of Investments (BOI) approved 100 projects in the first half of 2014 worth P149.45 billion, 38 percent less than the P240.74 billion posted in the same period last year.
BOI Managing Head and Undersecretary Adrian Cristobal Jr. traced the decline to the drop in power projects to P90.74 billion recorded for the sector in the first half of this year compared with last year’s big-ticket investments in the sector totaling P171.73 billion, as well as an increase in the lower-value mass housing sector.
Cristobal added that although the value of approved investments declined, BOI-approved projects generated more employment opportunities during the first semester of 2014, increasing by 35 percent to a total of 25,805, compared with 19,182 in the same period last year.
“The employment generation per project cost reveals higher employment gains which were noted at about 112 percent,” Cristobal said.
Among specific sectors, the Electricity, Gas, Steam and Air Conditioning Supply Sector (e.g., power generating plants, renewable energy projects) recorded the largest share of investment commitments with P90.74 billion or a 61percent share of total investments; followed by the Real Estate Activities, specifically, the Mass Housing sub-sector with P20.28 billion or a 14 percent share; the Accommodation and Food Service Activities Sector followed with P14.69 billion or a 10 percent share; the Construction Sector recorded P11.05 billion or a 7 percent share; and Transportation and Storage saw P6.87 billion in approved investments, a 5 percent share of the total.
The Electricity, Gas, Steam and Air Conditioning Supply Sector, the
best-performing sector in terms of BOI investment approvals during the past several years, continues to account for the bulk of the investment commitments.
The P90.74 billion contribution from this sector comes from 11 power generation projects approved in the first half of 2014, which are anticipated to provide 708.74MW of additional capacity in Luzon, particularly in Region IV where industries are concentrated. In the same period last year, the energy sector had 19 approved projects with a total project cost of P198 billion, which if fully completed would provide additional electrical capacity of 2,393.9MW in Luzon and Mindanao.
The Real Estate sector still managed to keep the second rank with a total amount of P20.283 billion despite this being a 22 percent drop the same period in 2013.
The sector is distributed mostly in Regions IV and NCR, both of which have large populations.
On the other hand, the Accommodation and Food Service sector saw tremendous growth, with its approved investment total of P14.686 billion for H1 being 248 percent higher year-on-year.
Likewise, the Construction Sector recorded a large gain, with its P11.05 billion representing a 100 percent gain compared to the same period in 2013, largely due to reconstruction efforts in the Visayas due to the Bohol earthquake and Typhoon Yolanda.
“Investment commitments from domestic sources reached P137.99 billion or 92 percent of the total investment approvals in January to June of the year while the remaining 8 percent or P11.46 billion were generated from foreign sources,” Cristobal said.
Topping the list of foreign country sources is the British Virgin Islands with investments worth P5.46 billion or 48 percent share to total foreign investments during the period. 13 percent, or P1.46 billion of foreign investments came from the United Kingdom, followed by Japan with P890.53 million or 8 percent of total foreign investments, Netherlands with P789.28 million or 7 percent share, and Thailand with P237.28 million or 2 percent share.
Cristobal added that half of the investment approvals in the first semester of the year went to Region IV, with power projects in Batangas accounting for P63 billion of the P75 billion in approved investments in the region. Investments in the National Capital Region (NCR) amounted to P36 billion or 24 percent of the total, mainly from investments in the Accommodation & Food Service and the Real Estate sectors; Region VI recorded almost P16 billion or 10 percent of the investment total from a power project to supply the energy requirements in Iloilo.