THE Department of Trade and Industry (DTI) plans to establish economic zones for the start-up sector that will offer support for operating costs, capital, and digital infrastructure.

Trade Secretary Ramon M. Lopez told reporters at the DTI Innovation Conference on Monday that the department will offer support for the unique business needs of start-ups.

He said that DTI will offer direct and time-bound assistance to help cover costs that start-ups usually have to obtain from the private sector.

“We will really just accelerate more programs in this particular community. Right now, in practice, there is little effort because there’s no budget. If we say we want to support this, there should be a budget,” Mr. Lopez said in English and Filipino.

DTI is ultimately planning for a fund of P1 billion for the project, and hopes to propose the first P200-300 million in its 2020 budget.

“Start-ups operate under a different environment — it doesn’t have to be physical. It can be a co-working spaces type of arrangement all in one building or in one space. As long as all the other enablers (and) digital internet infrastructure are there to support their operations, lower their cost… Those are the usual needs of start-ups,” Mr. Lopez said.

Unlike Philippine Economic Zone Authority (PEZA) ecozones, the project is not limited to fiscal incentives but will also include rent assistance.

The program will be offered to Filipino-owned companies instead of export-oriented businesses.

“It could be a future export business model, but we’re not limiting it to exporters. These will be different guidelines, rules, and incentives — it’s really different from a PEZA system,” Mr. Lopez said.

Asked about the funding schemes on offer, Mr. Lopez said: “You just have to take it as levels, step by step. Maybe a segmentized type of support. But you try to still create that environment that will encourage them to be creative and innovative with their business model and give (them) more training, mentoring so that they can fine tune their business models to be relevant,” he said.

DTI is developing criteria for selecting potential start-ups for the eco-zones, focusing on new and unique business models, and trying to determine an appropriate period firms can stay in the zone and call on government support.

The project is authorized by the Innovative Startup Act or Republic Act No. 11337, which allows training programs and business registration subsidies. — Jenina P. Ibañez

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