Of the total investments approved in 2004, the BoI accounted the bulk with P163.844 billion while PEZA contributed the balance of P67.156 billion.

The BoI-approved investments also point to 20.69 percent growth over its 2004 total registered investments of P135.75 billion.

On the other hand, PEZA’s 2005 generated investments posted a 32.82 percent increase over the 2004 approved investments of P50.561 billion.

Though modest, the growth in investments negates whatever negative impact from the uncertain political situation that gripped the country last year.

It also indicates an end to the prolonged investments drought since the 1997 financial crisis.

Trade and Industry Secretary Peter B. Favila noted that the 2005 average monthly growth rate of investments was also recorded at 1183 precent compared to 2004 average monthly growth rate of 239 percent.

"This is indicative of a sustained investment interest in the country for the whole year of 2005," Favila noted.

Favila reported that both agencies approved a total of 608 projects last year and are expected to generate 118,141 jobs once fully operational.

"Job generation in 2005 grew by 23 percent compared to 95,734 employment of 2004," Favila pointed out.

Of the 608 projects, the PEZA contributed the bulk of 389 projects up by 11.78 percent from 2204 with 348 projects while the BoI has fewer number of projects at 219 but with higher cost.

The PEZA projects are expected to contributed 71,792 jobs up by 25 percent from last year’s 56,966.

Local investors continue to be the major source of investments during the year with committed investments worth P137.07 billion or 59 percent of total investments while foreign investors account for P93.97 billion or 41 percent of total investments).

The biggest foreign investors are Japanese, Dutch and Korean investments with P27.34 billion, P17.93 billion and P10.64 billion approved investments, respectively.

Of the 608 projects approved in 2005, the manufacturing sector continues to be an attractive destination sector as it posted 184 percent increase from P52.14 billion in 2004 to P148.26 billion in 2005.

"The good performance of this sector simply indicates the country’s competitive investment advantage in terms of experienced managers, skilled labor force, modest if not excellent infrastructure especially in telecommunications and the attractive perks that include not only incentives but a streamlined approval process translating to reduced cost of doing business that we give to our investors," Favila said.

Favila also cited the agency’s vigorous promotion efforts of the government to offer the country as a platform for manufacturing operations have paid off tremendously.

"Our bias for these sectors has translated to more quality jobs that will be opened to our workforce," he said.

Manufacturing and services sectors, constituting 60 percent of total projects approved, made the largest contribution to the investment base during the year followed by infrastructure projects with 43 percent.

Likewise, these sectors contributed the most number of jobs with the manufacturing and services sector generating 113,032 while the infrastructure sector added 5,105.

Investments in the electricity, gas and water sector contributed P115 billion and P20 billion in 2004 and 2005, respectively.

The infrastructure and industrial facilities posted a negative 18.02 percent growth rate in 2005 (P120.64 billion in 2004 against P98.90 billion in 2005).

Favila said there is a need to further enhance the attractiveness of investments in infrastructure projects as infrastructure development goes in tandem with industrial development.

"In order to encourage more investments, we need to have world class infrastructure to support our comparative advantage in availability of quality human resources. In this regard, we are currently working for the amendment of the BOT Law to make it more business friendly notwithstanding that our success in BOT projects in the recent past is the envy of our neighbors," Favila stated.

Trade and Industry Undersecretary and BoI Managing Head Elmer C. Hernandez stated that investments in the IT Services sector remained bullish with the entry of call centers and business process outsourcing companies.

The sector garnered P8.81 billion in 2005 compared to P8.07 billion in 2004, posting a growth rate of 9 percent and employment generation grew by 77.36 percent to 49,186 in 2005 vs. 27,732 in 2004.

Hernandez considered this achievement very significant in terms of increasing competitiveness of this sector as far as the human resources cost is concerned.

In 2004, the IT investment cost per job was P291,149.14 as against P179,131.24 in 2005 translating to a 38 percent cost efficiency.

The IT sector remains to be one of the top employment generators contributing 43 percent of total employment in 2005. The leading IT investments in 2005 include Sykes Asia P480 million; E-PLDT, P200 million; Digital Media Exchange, P140 million; B2B Price Now. Com, P460 million; and Dynatec, P270 million.

Hernandez was also bullish on the mining sector as the government and the private are preparing a more focused investment promotion for the sector.

"With the Supreme Court holding the constitutionality of the Mining Act in late December 2004, we are now starting to feel the enhanced interest of mining investors. We expect to close substantial investment decisions in 2006," Hernandez said.

Last year the mining sector contributed P8.29 billion worth of investments up by 449 percent from P1.51 billion in 2004, Hernandez said.

Registered big ticket mining firms include Australian Mining Philippines, Inc., P7.08 billion, Mindanao Silicon Metal Corporation, P400 million, and Natural Resources Mining Development Corp., P200 million.

On the other hand, the infusion of capital into the retail trade sector slowed down to P110 million in 2005 as most giant retailers came in during the 2000 to 2004 period. Retail trade investments amounted only up to 0.05 percent of the total.

Investments in the retail trade sector peaked in 2004 with a total of P26 billion and accounting for 12 percent of total investments for that year.

Notably, the Gokongwei conglomerate is the single biggest investor of the year with three huge projects registered with the BoI.

The Gokongwei projects include the P26 billion naphtha cracker project of JG Summit Petrochemicals Corp.; the P21.146 billion refleeting project of Cebu Pacific Air (CEB), the country’s second flagship carrier that involves 14 new aircrafts servicing local and international routes and; the two sugar projects of Southern Negros Development Corp. worth P2.54 billion.

Other top investors in 2005 include PNOC Petrochemical Development Corp. (P34.8 billion), KEPCO Cebu Corp. (P15.20) Australasian Phils. Mining, Inc (P7.08 billion) and San Miguel Yamamura Asia Corp. (P5.20 billion), Petron Corp (P4.82 billion), Hedcor Sibulan Inc.(P4.03 billion), Wyeth Philippines (P3.75 billion) and Meridian Telekoms, Inc., (P2.02 billion), Asahi Glass (P1.73 billion) and Honda Philippines (P1.72 billion). (BCM)