|
AFTER de-listing them from the draft Investments
Priorities Plan (IPP), the Board of Investments (BOI) has reinserted
mining and car assembly in the list of projects that may qualify for
income tax holidays and other perks.
To avail of the incentives,
mining firms however have to use an innovative technology to
optimize high and low grade mineral deposits in the Philippines, the
BOI said.
The decision comes after lobbying
by the Chamber of Minds of the Philippines.
Trade Secretary Peter B. Favila
said the Philippines should take advantage of the ongoing review of
Indonesia’s mining law, and attract investors that would otherwise
opt for the other Southeast Asian country.
“While [we] may be
geologically favorable, there are other factors that [we] need to
consider, since Indonesia is [our] number one competitor. [We]
presently have an edge due to the uncertainties brought about by the
review of [their] mining law,” Favila said.
Trade Undersecretary Elmer C.
Hernandez, who is also BOI managing head, said the government will
only grant full incentives to mining investors that will invest
higher up the industry value chain.
“[We] do not want to export
direct shipping ore, since it doesn’t have an added value. It is
raw and it would only undergo a minimal processing,” Hernandez
said.
“There are instances that
mineral composition deposits could not be extracted by a traditional
plant, thus low grade minerals or deleterious composition will not
be fully utilized and would be put to waste,” he said.
The BOI official said the
government will draft specific guidelines for every mineral product,
which will be divided into metallic and non-metallic to determine
its role in the value chain.
He said that the granting of
income tax holidays and other perks will depend on the technology,
and the level of value added of the project.
Apart from mining, the BOI also
agreed to give out full incentives to the local car assembly
industry provided manufacturers make major investment in parts and
components.
“This issue had been
tackled during the nationwide public hearing. [We] agreed to give
the assemblers the incentives and other perks so long as [they] will
also put up a facility for parts and components,” Hernandez said.
Earlier, the Chamber of
Automotive Manufacturers of the Philippines Inc. complained of the
government’s decision to strike assembly out of the draft IPP.
The BOI had identified only
six preferred sectors for this year’s IPP, down from the 11
sectors in the 2007 list. Among the sectors that may still benefit
from the full suite of incentives are infrastructure, research and
development, constructive and direct exports, agriculture and
agribusiness, tourism, and engineered projects and strategic
investments.
While motor vehicle parts
and components are included in the engineered products in line with
the government’s Motor Vehicle Development Program, the BOI had
removed car assembly from the list.
--Katrina Mennen A. Valdez
|
