THE BOARD of Investments (BoI) is unlikely to reach its target of approving P1 trillion in new investments this year, reflecting the impact of the ongoing Russia-Ukraine conflict on global investor sentiment.
Ceferino S. Rodolfo, Trade undersecretary and BoI managing head, told reporters on Monday the BoI has approved P644.4 billion in investments from January to Nov. 15 this year, representing only 64.4% of its P1-trillion target for this year.
The BoI said 81% or P518.3 billion of the total approved investments came from domestic investors, while the rest came from foreign sources.
However, the January-to-November figure is already 73.51% higher compared with the P371.4 billion approved investments in the same period in 2021.
“What is certain is that we will surpass our 2021 level. That is for certain,” Mr. Rodolfo said in mixed English and Filipino.
The BoI’s total investment approvals stood at P655.4 billion in 2021.
“We did not foresee that there would be the Ukraine-Russia war that will have an impact not just on investment going to the Philippines, but also globally. It really affected us. But it is still good news that we will be able to surpass 2021 levels,” Mr. Rodolfo added.
Russia’s invasion of Ukraine in late February had widespread economic implications for the rest of the world. The impact was felt through rising prices of commodities such as food and energy, soaring inflation, supply chain disruptions, lower business confidence and higher investor uncertainty.
For the January-to-November period, the BoI said the biggest amount of approved investments were committed to the power sector at P343.8 billion.
This was followed by information and communications technology sector with P197.6 billion, administrative and support services activities with P26.8 billion, transportation and storage with P25.2 billion, and real estate with P23.8 billion.
Singapore was the top source of BoI-approved foreign investments with P75.3 billion, followed by Japan with P29.9 billion and United Kingdom with P9.9 billion. Investments from the British Virgin Islands stood at P2.6 billion, while those from South Korea hit P2.5 billion.
For 2023, Mr. Rodolfo said the BoI already has P372.8 billion worth of investment leads.
Of the total, P125.3 billion is from the information technology and business process management (IT-BPM) sector, followed by real estate activities at P105.47 billion, and agriculture, forestry, and fisheries at P66.9 billion.
Mr. Rodolfo said several big-ticket projects are expected next year, particularly for sectors such as green metals and renewable energy.
The Energy department last week revised a circular, which paved the way for full foreign ownership in the renewable energy sector.
“The BoI remains optimistic that foreign investments in 2023 will show significant growth given the game-changing economic reforms enacted in the Philippines such as the amended Public Service Act, amended Foreign Investment Act, amended Retail Trade Liberalization Act…,” it said.
Meanwhile, Trade Secretary Alfredo E. Pascual told reporters that fully digitalizing the government’s functions would help improve the processing of foreign investments in the country.
“The digitalization of the whole government function will be the solution for the speedy processing of foreign investments. The common complaint of people we talk to is that they talk to many people in the process,” Mr. Pascual said. — Revin Mikhael D. Ochave