Peza: Backlog in development projects amid slow Malacañang approval process

by Roy Stephen C. Canivel, Inquirer, Jan 3, 2017

The year has passed but more than P72 billion worth of investments to develop new economic zones still could not begin construction, a delay caused by the slow approval process in Malacañang.

As of December 29, there are 42 development projects that were still languishing in Malacañang’s backlog, five of which were projects to put up manufacturing zones during the Aquino administration, according to the Philippine Economic Zone Authority (Peza).

Without a presidential proclamation, a project to develop an economic zone is put on hold. This also delays the investments of Peza-registered companies that are supposed to locate in that particular ecozone.

Of the P72.3 billion worth of projects waiting for presidential proclamation, 37 projects amounting to P64.7 billion were filed under the Duterte administration while the remaining P7.6 billion worth of projects were filed under the Aquino administration

There were fewer approved development projects in 2017 compared to those that were still in the backlog. According to Peza, only 35 projects received presidential proclamation, reaching a combined project cost of P37.58 billion.

Peza Director General Charito Plaza told reporters in a recent interview that the investment promotion agency was invited by the Office of the Executive Secretary in order to discuss the pending projects back in October.

The meeting included the Philippine Chamber of Commerce and Industry (PCCI), which had called on the government to fastrack the process. PCCI made this part of its resolutions during a business conference in October 2017, noting that the delay has raised concerns among investors.

“We were invited to a dialogue. Of course, nobody accepted the fault [for the delay], but as far as Peza is concerned, we had a chart [on] how many months it took for one ecozone to be proclaimed. We are supported with records plus the resolution of the chamber,” Plaza said.

She said that she hopes there would be more presidential proclamations at the start of this year.

When asked why projects during the Aquino administration remain unapproved in spite of being filed first, she said that there were “new people in the Palace who are still learning the processes.”

Thirty out of the 35 projects approved in 2017 were buildings that would house Information Technology and Business Process Management (IT-BPM) companies, an industry which suffered a big drop in new investments last year.

According to Peza data, new investments in the IT-BPM industry fell more than 48 percent in 2017, reaching only P15.56 billion.

This reversed the slow recovery that the industry has been seeing in terms of new pledges in the past months.

In the first 10 months of 2017, the decline in pledges narrowed to 8.44 percent, an improvement from the January to May period when the decline reached nearly 35 percent.

The five remaining projects approved consisted of four manufacturing ecozones and one agro-industrial ecozone, Plaza said. /kga