Investments approved by the Philippine Economic Zone Authority (PEZA) dropped by nearly a fifth in 2020. — REUTERS/CHERYL RAVELO

INVESTMENTS approved by the Philippine Economic Zone Authority (PEZA) dropped by nearly a fifth in 2020 after stringent lockdown restrictions dented domestic investor confidence.

The investment promotion agency registered P95.03 billion in pledges, falling 19.15% from the P117.54 recorded in 2019. The 2019 figure represented a 16.19% drop from the previous year, which in turn fell 41%.

Last year’s total fell short of PEZA’s target to approve at least P100 billion in investment pledges, which was already downscaled from the 5-10% growth target set before the coronavirus disease 2019 (COVID-19) pandemic hit.

PEZA last year saw delays in investment approvals as the board failed to meet during the strict lockdown which began in mid-March. Even so, PEZA approvals slid 5.85% in the first two months of 2020.

PEZA Director-General Charito B. Plaza had said that pending tax reform proposals at the time and the impact of the pandemic on export manufacturers and outsourcing firms caused challenges in attracting investments.

Foreign investments last year jumped 21.26% to P59.73 billion, but local investments plummeted 48% to P35.3 billion, PEZA said in a statement on Thursday.

“The decline can be attributed to various causes including the perilous effect of the COVID-19-imposed lockdowns beginning March 2020,” the agency said.

Overall, PEZA approved 326 projects last year, 217 of which came from the manufacturing sector. The sector generated P34.44 billion in investments, or 13.43% higher than the previous year.

The 109 projects under the outsourcing sector brought in P17.41 billion in investments, down just 0.93% from 2019.

Most of the foreign investments came from the United States, European countries like the United Kingdom and Belgium, and Asian countries like China, South Korea, Singapore, and Saudi Arabia.

The bulk of the investments will be poured into Calabarzon (Cavite, Laguna, Batangas, Rizal, Quezon), followed by the National Capital Region, Central Visayas, and Central Luzon.

Meanwhile, the Board of Investments (BoI), which accounts for a bulk of planned projects registered with investment promotion agencies, reached a total of P1.02 trillion in investments, a 10% drop from the agency record P1.14 trillion in 2019.

BoI-approved investments doubled in the first half of 2020 despite the lockdown, mostly led by a San Miguel Corp. subsidiary’s P740-billion airport project in Bulacan. Domestic investments at the time jumped by 166% due to the airport project, but foreign investments plummeted by 73%.

“We hope in 2021, we will be able to attract more foreign direct investments in the country, keep the PEZA brand of service renowned worldwide, and help the Philippine economy bounce back,” Ms. Plaza said. — Jenina P. Ibañez