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I nvestment. BOI. R oadshow. 2012 IPP Presentation. Bacolod, Baguio, Butuan , Cagayan de Oro, Davao, Dipolog , Naga, Pasay, Puerto Princesa , Tacloban , Tagbilaran. O UTLINE (PPP). P erspectives P referred Investment Areas P otentials. Part : P erspectives. 1.
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Investment BOI Roadshow 2012 IPP Presentation Bacolod, Baguio, Butuan, Cagayan de Oro, Davao, Dipolog, Naga, Pasay, Puerto Princesa, Tacloban, Tagbilaran
OUTLINE (PPP) • Perspectives • Preferred Investment Areas • Potentials
Part : Perspectives 1 “Perspective is the most powerful tool we have” - Edmond Sailer
WHY INVEST? To participate in Nation Building (i.e. Direct Investments in preferred areas To pursue Personal Interests (i.e. Retailing, Real Estate Stock Market) To enhance the Value of your Savings (i.e. Bonds, Deposits)
ECONOMICS 101 GDP = C + I + G + (X-M) C = Consumption I = Investments G= Government Expenditures
THE INVESTMENT ECOSYSYTEM 1 4 PLACE NETWORKS • A large domestic market • Competitive operating environment • Less vulnerable to • global downturn • Industrial peace • Accelerated infra program • Investment promotion agencies • Local investment • councils 2 3 FUNDS • Growing number of entrepreneurs • Young labor force • Training programs intensified PEOPLE • High liquidity • Low interest rates • High investors confidence • Government support to SMEs
INVESTMENT PROMOTION AGENCIES DOMESTIC EXPORT Philippine Ecozone Authority (PEZA) Board of Investments
BOI’S ROLE IN PROMOTING INVESTMENTS TARGETED INVESTMENT PROMOTIONS ADMINISTER INCENTIVES PREFERRED ACTIVITIES REGISTER ELIGIBLE PROJECTS INDUSTRY ROADMAP TRADE/INVESTMENT NEGOTIATION INVESTOR FACILITATION
Red Tape to Red Carpet • “The red tape that has for so long encumbered your generation has now been turned into a red carpet” - President Benigno S. Aquino III April 2012
BOI REGISTRATION SIMPLIFIED • No more detailed 5 year Financial Projections required for 95% of projects • Only 4 page Application form (inclusive of supporting schedules) • Endorsements from other agencies required only after BOI approves the project • Board action 2 weeks after filing
OTHER LAWS ADMINISTERED BY BOI • Registration of RHQ and ROHQ (Book III of EO 226) • Special Investor’s Resident Visa (Book V of EO 226) • Investor’s Long-term Lease Act of 1993 (RA 7652) • Retail Trade Liberalization Act of 2000 (RA 8762) • Jewelry Industry Development Act of 1998 (RA 8502) • Footwear, Leather Goods and Tannery Development Act of 2004 (RA 9290)
Part : Preferred Investment Areas 2 “This year’s IPP has been crafted to focus on four critical areas; job generation, enhanced delivery of social services, international competitiveness and climate change mitigation and adaptation”. - Pres. Benigno S. Aquino III- June 2012 (IPP Message)
2012 INVESTMENT PRIORITIES PLAN MANDATORY PREFERRED • Books • Mining • Petroleum Products • PWD Support • Renewable Energy • Tourism • Solid Waste Management • Water Supply • Agribusiness • Creative/Knowledge-based • Disaster PMR • Energy • Green Projects • Hospitals • Infrastructures • Iron and Steel • Mass Housing • Motor Vehicle • R & D/ Training • Shipbuilding • Strategic Projects EXPORTS • Manufactured Products • Services Exports • Activities Supporting Exports
AGRI-BUSINESS 1. Commercial Production • Crops planted in New Areas • Poultry and Livestock 2. Commercial Processing • Locally Grown Raw Materials • Animal and Aqua Feeds 3. Services • Post Harvest facilities • Mechanized Harvest 4. Fertilizers and Pesticides
CREATIVE & KNOWLEDGE-BASED INDUSTRIES 1. Non- Voice BPOs (Voice now listed under Exports) 2. IT Enabled Services with Original Content • Software development • Animation • Engineering Design • Game Development
DISASTER PREVENTION, MITIGATION & REHABILITATION • Manufacture and Assembly of Goods and Equipment related to Disaster Mgt. 2. Services related to Disaster Mgt. • Salvaging Operations • Early Warning Systems • Oil-spill Clean Up • Bridge Rehabilitation • Flood Control Services
GREEN PROJECTS 1. Manufacture or Assembly of Goods & Equipment that leads to: • Efficient Use of Energy • Efficient Use of Natural Resources • Reduce GHG • Minimize Pollution 2. Energy Efficient Related Facilities (i.e. District Cooling)
HOSPITALS Development and Operation of Primary, Secondary and Tertiary hospitals
MASS HOUSING • Development of Low-cost Housing (Selling Price > P 400,000 < P 2.5 million) 2. Manufacture of Modular Housing Components
R&D / TRAINING 1. Research/ Testing Facilities 2. Business/Technology Incubators 3. Shared Service Facilities 4. Manufacturing & Agri business enterprises located in SUCs (outside NCR) 5. Training Institutions in Support of IPP
TOURISM (R.A. 9593) 1. Transportation Facilities 2. Accommodation Facilities 3. Health & Wellness Facilities 4. Retirement Villages 5. Historical Destinations
CAPITAL INTENSIVE PREFERRED AREAS • ENERGY (exploration, development and utilization of energy sources) • INFRASTRUCTURE (transport, water, logistics, physical infra and PPP) • IRON & STEEL (long and flat products, fabrication of machinery) • MOTOR VEHICLES (2 and 4 wheel vehicles, parts manufacturing) • SHIPBUILDING (> 500 ton ships) • STRATEGIC PROJECTS (packaging products and essential drugs).
Part : Potentials 3 “The great end of life is not knowledge but action” - Thomas Huxley
OPPORTUNITIES ABOUND Japan • Strength of Yen • Vulnerable to calamities • China • High labor costs • (P336/day Shenzhen) • Vietnam • Inflation rate of 20% • Thailand • Sharp increase in labor costs (P397/day) • Taiwan • Base for ASEAN market Manufacturing: • Large domestic market, increasing disposable income • Free trade agreements w/ key trading partners - ASEAN ($1.8T) 7B/R/I Agriculture: • Huge demand for HALAL food ($340B) • Higher income in key markets Services: • Tourism arrivals rapidly increasing • 2011-11.2% / 2012-14.6% • BPO increasing by • 15-20% FDI’s SME’s
AGRI-BUSINESS: HIGH QUALITY, HIGH VALUE Fisher Farms, Inc. (FFI) in Bulacan is the leading aquaculture food processor in the Philippines. The company has 934 employees. Recipient of the Superior Taste Award from Belgium-based Taste and Quality Institute (ITQI) – a global organization of Chefs.
MANUFACTURING: IN A SWEET SPOT D’Luxe Bags Philippines, Inc. in Tarlac City manufactures fashion bags for global brands. The company will employ 4,000 workers.
TOURISM: MORE FUN… MORE HOMEWORK Paraiso Verde Resort & Water Park has water amusement attractions like wave pool, raging river pool, kiddy pools and pools w/ shade. The company is located in South Cotabato and employs 65 people.
+ INCENTIVES - DISINCENTIVES Factors impeding business confidence: • Corruption (24.4%) • Inefficient bureaucracy (18.3%) • Infrastructure* (16.5%) * Average cost of electricity to cost of manufacturing goods is only 4.63%
PATHS TO NATION BUILDING SOCIAL SERVICES • Mass housing • Hospitals • Disaster-related • Support to PWD • Solid waste management • Water supply JOB-GENERATION • Agri-business • Shipbuilding • Tourism • Mining • Export –oriented Industry COMPETITIVENESS • Energy • Infrastructure • Creative-knowledge based • R&D / Training • Iron & steel • Strategic projects • Downstream oil industry CLIMATE CHANGE • Green projects • Renewable energy • AFV & E-motor vehicles
SAILING ON THE ARK “Remember, amateurs built Noah’s Ark; Professionals built the Titanic”
FROM SICK MAN TO OLYMPIAN TOP ECONOMIESBY 2050 (HSBC)
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