P1.9-T investment pledges in 2024 a record high
Economic reforms are paying off and more positive policy actions could further boost the investment climate in the country, two analysts said on Tuesday.
This developed after the Board of Investments (BOI) on Monday posted an all-time high of P1.9 trillion in investments pledges in 2024, surpassing the 2023 figure of P1.47 trillion by 29 percent.
Another government agency, the Philippine Economic Zone Authority (PEZA), registered a 337.58-percent increase in investment approvals that reached a total of P52.933 billion for the first two months of this year. That compares with P12.097 billion in January to February 2024. (Full story on this page.)
The analysts are bullish about the country’s prospects given the ongoing reforms. One of them said such moves will support the Philippines’ bid to become an ”investment destination.”
Jonathan Ravelas, BDO chief strategist, identified these positive developments: the Philippines’ exit from the Financial Action Task Force’s dirty money ‘gray list’, the signing of the implementing rules and regulations (IRR) of the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act and the reduction in the reserve requirement ratio for big banks.
Michael Ricafort, RCBC chief economist, said reform measures should continue to encourage more foreign investment into the country, also citing the CREATE MORE as an example.
“For the coming months, the CREATE MORE Law would now make international investors more decisive to locate in the country with better incentives that could compete better with other ASEAN/Asian countries,” Ricafort said.
Ricafort said the other reform measures that have been in place and sparking investor interest include: amendments to the Public Service Act, Retail Trade Liberalization Act, amendments to the Foreign Investment Act, and the 100 percent foreign ownership of renewable energy projects.
Ricafort said the Philippines’ regional trade engagements are working to the country’s advantage. These are the Regional Comprehensive Economic Partnership, the world’s largest free trade agreement (FTA), and the Philippines-South Korea FTA, which took effect in December 2024.
As a reform measure, CREATE MORE seeks to narrow the incentives gap with other neighboring countries like the corporate income tax rate to 20 percent from 25 percent for registered business enterprises, value-added tax exemptions, and electricity expenses deductible from taxable income, among others.
“Thus, there would be more FDI (foreign direct investments) into the country for the coming months due to CREATE MORE,” Ricafort said.
The record P1.9-trillion investment pledges approved by the BOI last year are expected to generate 130,000 jobs, Special Assistant to the President for Investment and Economic Affairs Frederick Go said as quoted by the BOI statement on Monday.
The BOI said the domestic investment component of the total pledges more than doubled to P1.35 trillion in 2024, taking up 71 percent of the total that year.
Foreign investments accounted for 29 percent at P544 billion.
The total 2024 figure compares with P578 billion in 2023.
“This unprecedented performance shows growing investor confidence in the Philippines and the success of the administration’s investment and economic policies. We are optimistic that these approved projects will translate into tangible economic benefits in the coming years, including the creation of more and better job opportunities for Filipinos, and paving the way for sustainable, investment-led growth,” Go said.
BOI managing head Ceferino Rodolfo said the types of projects are in sectors that will modernize and structurally transform the economy—such as renewable energy (RE), telecom infrastructure, innovation-driven light manufacturing, and integrated tech-enabled agriculture.
The renewable energy sector led all investment categories, attracting P1.30 trillion; followed by manufacturing, P144 billion; real estate, P138 billion; transportation and storage, P131 billion; and electricity, gas, steam, and air conditioning supply, P79 billion.
By foreign sources, Switzerland, South Korea, the Netherlands, Japan, and Singapore emerged as the top investors.
