Philippines

As an Investment Destination
For Infrastructure Projects

USEC. CRISTINO L. PANLILIO

Vice Chairman & CEO
Board of Investments
 Presentation Outline

Trade and Investments Performance

Outlook

Creating an Attractive Environment for Investments

PPP as cornerstone strategy for development

The Philippine Advantage

Exports and Investments: Growing in 2010
BOI-PEZA Approved Investments; in Php billions

500
Php443.1

400
Php349.1
Php299.5
300 Php271.3
Php249.0
Php231.0

200

Php98.9
100

0
2005 2006 2007 2008 2009 Jan-Aug Jan-Aug
2009 2010
Project Cost
Exports and Investments: Growing in 2010

Export Performance; in US$ millions

60 30.0%
$50.5 $49.0 $46.0
50 $47.4 20.0%
$41.3
$38.3
40 14.9% 20.0% 10.0%

6.5%
30 4.0% 0.0%

-2.9%
20 -10.0%

10 -20.0%
-21.9%
0 -30.0%
2005 2006 2007 2008 2009 2010 Target

Amount in US$ Mn (lhs) Growth Rate (rhs)

Robust Economic Outlook for 2010 and 2011
Actual Targets3/
2010
2009 2010 2011
Latest
Real GDP Growth (%) 1.1 7.9 (Jan-Jun) 5.0 - 6.0 7.0-8.0
Headline Inflation (%) 3.2 4.0 (Aug) 3.5 - 5.5 3.0 - 5.0
Exports Growth (%) 1/ (22.3) 43.5 (Mar) 15.0 13.0
Imports Growth (%) 1/ (24.1) 34.0 (Mar) 20.0 18.0
OFW Remittances 2/
Amount (US$ Bn) 17.3 9.1 (Jun) 18.7 20.2
Growth Rate 5.6 6.9 (Jun) 8.0 8.0
Balance of Payments (US$ Bn) 5.3 3.3 (Jul) 3.7 n.a.
GIR (US$ Bn) 44.2 49.6 (Aug) 49.0 - 50.0 n.a.
1/
Based on Balance of Payments (BOP) concept
2/
Remittances coursed through banks
3/
Based on forecasts adopted by the Development Budget Coordination Committee (DBCC) on July 9, 2010
2010 Sectoral Targets
• BOI-PEZA Approved Investments: $10 B
• Merchandise Exports: $46 B
• Remittances: $19 B
• BPO / Call Center: $9.4 B
• Electronics / Semicon: $25 B
• Tourism: 3.3 M foreign visitors
Creating Better Business Environment
• Ensure ease of doing business
• Provide competitive investment incentives
• Improve infrastructure through enhanced
implementation of the Public-Private Partnership
(PPP) Programs
 Ensuring Ease of Doing Business
• Full implementation of Business Name Registration
System (BNRS)

• Implementation of the Philippine Business Registry (PBR)

• Improve Business Permits and Licensing System (BPLS)
at the local government level
• Nationwide support for National Economic Research and
Business Assistance Centers (NERBAC)
Investment Facilitation Services
Due diligence assistance
 Information support
 Visit program development & investment briefing
 Business matching
Business registration facilitation
 Fast tracking of applications for registration
 Assistance with Local Government Unit (LGU) requirements
Aftercare Service
 Presence of government network to quickly respond to
concerns
Supervision & monitoring
The Foreign Investments Act
Special Features of FIA
Allows Non-Philippine Nationals to invest in domestic or export
-oriented (at 60% export) activities (non-FINL) up to 100% of its
capital

Foreign Investment Negative List (FINL)

List A – areas of activities reserved to Philippine nationals where
foreign equity participation in any activity listed therein shall be
limited to a maximum of 40% as prescribed by the Constitution
List B – areas of activities where foreign ownership is limited pursuant
to law for reasons of security, defense, risk to health and morals
and protection of SMEs.
Competitive Investment Incentives
 Public-Private Partnerships
Cornerstone strategy of national development

• Reorganizing the BOT Center into the PPP Center

• Focus on infrastructure support facilities for tourism,
agriculture, social services and growth centers
• Provide incentives to stimulate private resources
• Ensure competition, fairness and transparency
• Provide assistance in preparation of business case, pre-
FS, full FS, detailed engineering, tender document, etc.
• Fast-track project approval process
• 2011 Rollout/Tender: 10 Projects
• 2012 & beyond: 73 projects
Public-Private Partnerships
Cornerstone strategy of national development
Project Name Project Cost
(2010 Prices in PhP Million)
MRT/LRT Expansion Program: Privatization of LRT 1 Operation & Maintenance 7,700
(DOTC/LRTA)
LRT Line 2: East Extension Project (DOTC/LRTA) 11,300
MRT/LRT Expansion Program: Privatization of MRT 3 Operation & Maintenance 6,300
(DOTC/LRTA)
MRT/LRT Expansion Program: LRT 1 South Extension Project (DOTC/LRTA) 70,000

New Bohol Airport Development 7,600

(DOTC/MIAA/CAAP)
Puerto Princesa Airport Development 7,600
(DOTC/MIAA/CAAP)
New Legaspi (Daraga) Airport Development 3,200
(DOTC/CAAP)
Privatization of Laguindingan Airport Operation &Maintenance (DOTC/MIAA/CAAP) 1,500

NAIA Expressway, Phase 2 (DPWH) 10,590

CALA Expressway – Cavite Side Section (DPWH) 11,790
Government Support to BOT Projects
Fiscal Incentives
Projects costing more than P1 billion are entitled to
incentives under Omnibus Investments Code (OIC) upon
registration with the Board of Investments
Projects costing P1 billion and below can avail incentives
under OIC subject to inclusion in the current Investment
Priorities Plan
LGUs may provide additional tax incentives, exemptions,
or reliefs, subject to the provisions of the Local
Government Code and other pertinent laws
Government Support to BOT Projects
Cost-Sharing
Projects with difficulty sourcing funds may be partially
financed from direct government appropriations (GAA)
and/or Official Development Assistance (ODA)
Financing from GAA or ODA not to exceed 50% of project
cost
Other Government Undertakings
Include credit enhancements such as take or pay, currency
convertibility, etc.
Direct government subsidy or equity
The Philippine Advantage

Strategic Location in Asia

Available Quality Human
Resources
Reliable infrastructure support
Hospitable Lifestyle
The Philippine Advantage
Strategically Located in Asia
Good access to the important 550
million people ASEAN market
Reachable within 4 hours by plane
from Asian key cities
 Tokyo - 4 hrs
 Shanghai - 3.25 hrs
 Singapore - 3 hrs
 Taipei - 2 hrs
 Bangkok - 3 hrs
 Macau - 2 hrs.
 Jakarta - 3.25 hrs
 Kuala Lumpur - 3.5 hrs
Available Quality Human Resources
Highly educated
 92.6% literacy rate, 70% fluency in English
 36 million labor force
 450,000 college graduates per year
 40,900 IT / Computer Sciences / Engineering
 98,120 Commerce / Business-related
 125,000 Medical & Allied / Natural Sciences
 62,000 Eng’g & Architecture/Fine Arts
English proficient
Strongly customer service oriented
Excellent in the practice of professions
Highly trainable and with fast learning curve
Adaptable to universal cultures
High level of commitment and loyalty
Reliable Infrastructure Support
Super Regions Infrastructure
Development
Network of roads, railways,
waterways & airports
Invigorated Aviation Industry
Fast-tracking of Port
Development
Connection to the world
24/7
Hospitable Lifestyle

• Friendly people
• Value-for-money housing
• Modern recreational facilities
• First-rate educational institutions
• Presence of international schools (e.g. Brent
School, International School Manila, British
School)
• A growing favorite tourist destination
• 8.7% increase in tourist arrivals (3.09 million)
• 41% increase in tourist spending
Thank You!