Investments for the expansion of economic zones plunged 65 percent in the first nine months to P42.9 billion from a year ago amid the government’s plan to phase out tax incentives.
Data from Peza showed that the nine-month investment figure declined from P123.7 billion approved in the same period last year.
Peza director-general Charito Plaza said economic zone operators were holding off expansion plans because of the uncertainties in the Philippine tax reform program.
“They are holding off expansion. Even the new zones are on a wait-and-see mode for updates regarding Train [Tax Reform for Acceleration and Inclusion] 2. Others are preparing for an exit plan in case they are not happy with Train 2,” she said.
Plaza said investments in the manufacturing sector slid 46 percent to P24.2 billion from P45 billion in 2017.
IT investment pledges provided the silver lining with an 8.8-percent increase to P12.4 billion in the nine-month period from P11.4 billion a year ago on rising demand from BPO clients.