Trade and Industry Secretary Peter B. Favila has directed the Board of Investments (BoI), the government’s premier investment generating agency, to be more progressive in setting their investments growth target this year.

Favila, also chairman of the BoI, said this after confirming that the country’s overall investments haul in 2009 remains in the positive.

“The BoI missed its target but with if we combine BoI and the investments generated by the Philippine Economic Zone Authority, we are positive,” Favila said.

PEZA has already reported of a 3.3 percent increase in investments in 2009 to P175.365 billion versus P154.773 billion in 2008. Favila, however, has refused to divulge the final BoI investments tally in 2009. The government has targeted a 0 to 5 percent increase in investments in 2009 over 2008 for both PEZA and BoI.

Coming from a low base in 2009, DTI Undersecretary and BoI Managing Head Elmer C. Hernandez has set a lower investments growth target of 10 percent for 2010 over the 2009 figure.

“I told them to be progressive,” Favila said referring to the 10 percent investments growth target of the BoI.

Without giving away the 2009 BoI figure, Favila said, “We are satisfied with the results given the global financial crisis last year. If we hit 8 on a scale of 1 to 10, then that would be good enough.”

Earlier, however, Favila said that the holding of peaceful and credible elections would dictate the flow of foreign investments into the country this year and that investors would have to wait for the outcome of the national elections in May before they would pursue investment plans in the country.

“Those that came in December last year are expected to proceed because those investments have been in the pipeline already but for companies that are coming in January this year would have to do preliminary work yet and finalize their plans after the elections,” Favila said.

According to Favila, the conduct and outcome of the elections are more important to investors.

“So, it is important that we have peaceful and credible elections,” he said.

Meantime, Hernandez said that investments in commodities from China, Korea and the Middle East countries are going to fuel a conservative 10 percent investments growth in the country this year.

Hernandez said that huge commodities (metals and agriculture) projects are expected to come in the first semester this year.

“Investments are coming in 2010,” said Hernandez, who based his forecast from the positive response to the investment promotions he spearheaded in the middle to the latter part of 2009.

Hernandez went to Korea, China and the Middle East countries last year. Early this year, Korea and China have already sent in their private sector to explore investment opportunities here while the Middle East are sending their teams soon.

“Both the Chinese and Korean groups are doing due diligence work,” Hernandez said.

Hernandez said these investments may cause a reversal in the equity share ratio between the foreign and domestic businessmen. Historically, the projects registered with the BOI have an equity share ratio of 60-40 in favor of the domestic businessmen.

“We could have a situation where the ratio is tilted in favor of the foreign investors given the number of wholly foreign-owned firms that are expected to come in,” he said.

According to Hernandez, the Philippines would profit from the global economic rebound that would be driven by investments in the commodities sector.

“Commodities will have a bigger picture in the economic recovery,” he said stressing that countries would have to ensure food security.