By Jenina P. Ibañez, Reporter

THE Board of Investments (BoI) saw pledges sink by 71% in the first four months of 2020 as the coronavirus disease 2019 (COVID-19) disrupted economic activity in the country.

The BoI, which accounts for the bulk of planned projects registered with investment promotion agencies (IPA), on Thursday said it approved P84.1 billion year-to-date in April, well below the P286.7 billion in the same period last year.

Domestic investments fell 68% to P70.7 billion from a year earlier, while foreign investments dropped 80% to P13.4 billion from P66.9 billion.

“We have chosen to carefully re-confirm with proponents their commitment to pursue even in this environment. So far, the investors remain solidly optimistic about the medium-to-long-term prospects of the country,” BoI Managing Head Ceferino S. Rodolfo said in a statement.

The BoI, he said, has shifted to providing support for firms to continue business operations during the lockdown which started in mid-March.

For full-year 2019, total approved commitments among investment promotion agencies rose 112.8% to P390.11 billion. BoI contributed 86.1% of total foreign direct investment pledges at P335.74 billion.

American Chamber of Commerce of the Philippines Senior Advisor John Forbes in a mobile phone message on Thursday said that businesses have prioritized its response to the pandemic and have delayed expansion plans.

“Going forward, the Philippines will have to work together and harder to see the country as an investment site vis-a-vis competitors. Fortunately, many companies are looking at locating in or expanding to Southeast Asia and we hope (they) will consider the Philippines,” he said.

The four months to April saw transportation and storage investments at BoI reach P60.2 billion, or 71% of the total figure. Real estate investments reached P8.8 billion, followed by manufacturing (P5.3 billion), power (P4.2 billion), and accommodation (P3.8 billion).

The 70 projects — down 23% from a year earlier — are expected to create 11,055 jobs, which are also 23% below last year’s 14,409.

Among foreign pledges, investments from France topped the list with P1.5 billion, while Japan followed with P790 million. Malaysia followed with P601 million, while investments from India and the United Kingdom were valued at P325 million and P156 million, respectively.

Among those approved in April were Anflo Banana Corp.’s P616-million banana production project in Davao Oriental, and Maclin Electronics, Inc.’s P132-million project in Rizal.

In an online press conference on Wednesday, Mr. Rodolfo said the Philippines attracted almost P1.6 billion in realized investment projects that have relocated from China. Most were approved in late 2019.

The biggest was a P1.2-billion tennis ball manufacturing project by a Netherlands-based company. Five projects were from Taiwanese companies, and one from the United States. Six were registered at PEZA.

Mr. Rodolfo said he does not want to position the Philippines as an “alternative” destination from China.

“We have never positioned the Philippines as a country that will steal investments from China, but rather we present the Philippines as a complementary site for businesses in China to help them cope with the…US-China trade war,” he added.

The Philippines is targeting 135 foreign companies in its industry promotion strategy, including 64 China-based companies affected by the trade war and 16 Wuhan-based companies affected by the pandemic.

The Philippines has generated 24 business leads, with 12 from Taiwan, seven from Japan, three from China, and two from the US.

Mr. Rodolfo said investment promotion initiatives include encouraging the expansion of existing companies, engaging with target companies and existing leads, and developing digital marketing initiatives.

But there are challenges in attracting companies while businesses are put on hold during the pandemic and some foreign governments encourage companies to re-shore operations. Mr. Rodolfo added that China remains attractive to investors.

The BoI has been working with the private sector to repurpose export manufacturing activities to produce medical products and personal protective equipment (PPE) to help the domestic market address the COVID-19 crisis.

MedTecs International Corp. Ltd. and Yokoisada Philippines Corp. have been producing face masks, with the former committing to produce 10 million pieces each month from May to July.

BoI is also working with several companies to produce more medical or non-medical grade face masks, disinfectant alcohol, face shields, and ventilators, while garment exporters are producing protective coveralls.

Mr. Rodolfo said the Philippines is facing constraints in acquiring needed medical products and PPEs due to global supply shortages and export bans. The country needs N88 surgical mask middle filters, N95 masks, medical-grade gloves, and medical-grade fabric for PPEs.

He said the country needs to locally produce active pharmaceutical ingredients for COVID-19 drugs and test kits, and must prepare to produce COVID-19 vaccines once it has been developed.

Trade Secretary Ramon M. Lopez said the government is working to increase local production of medical-grade masks.

“As a result, from a pre-COVID capacity of just about 7 (million) masks and all directed to the export market; the Philippines, by end of this month, would already have an actual capacity level of close to 25 (million) masks for the domestic market,” he said.