PHILIPPINES

leading the way among emerging markets

Philippine Trade & Investment Center - London

Embassy of the Philippines Commercial Section
United Kingdom

Sunday, 16 May 2010

 PRIORITY SECTORS

renewable energy

I.T. & business support

outsourcing

infrastructure development

electronics manufacture

sustainable mining

Sunday, 16 May 2010

 PHILIPPINES
leading the way among emerging markets

renewable energy
Sunday, 16 May 2010
 RENEWABLE ENERGY
Highly supportive legislative
framework

Commitment to the Environment

Availability & Variety of Renewable

Energy Resources

Unmatched Government Incentives &

Support

approximately $30 Billion in available

investment opportunities

Sunday, 16 May 2010

 RE OPPORTUNITIES
Hydropower Capacity currently at 3,289 Megawatts, with
potential for 2,402 Megawatts of identified projects
available for investments

largest potential (76,000 MW) for Wind Energy among the

Southeast Asian countries.

2nd largest producer and potential Geothermal Energy in

the world

Solar Power technology has been instrumental in providing

power to agrarian communities in the countryside. The
solar support project, initiated by the Philippine National
Oil Company (PNOC)

The country has abundant biomass resources for BioFuel

Energy production with installed capacity expected to reach
161 Megawatts by 2014.

Sunday, 16 May 2010

 RE LEGISLATIVE
FRAMEWORK
Renewable Energy Act of 2008 -With the Signing of Republic Act 9513, the
Philippines seeks to achieve 60% self sufficiency in energy by 2010. Besides
cutting back on carbon emissions, it saves the cost of imported oil, and is an
important generator of foreign investments for the country.

The Biofuels Act of 2007 which was enacted into law on January 2007 will
require the mandatory blending of coco-biodiesel with petroleum diesel
initially at 1% by early May 2007, increasing to 2% within two years.

Presidential Memorandum Order No. 299 - Renewable Energy and Carbon

Credit revenue earning activities are identified as activities under the 2010
Investments Priorities Plan and grants government incentives to and
support for qualified investors.

Sunday, 16 May 2010

 RE FISCAL INCENTIVES
Income tax holiday for 7 years

Duty-free importation of RE machinery, equipment and

materials including control and communication equipment

Special realty tax rates on equipment and machinery

Net operating loss during the first 3 years from the start of
commercial operation which had not been previously deducted
from gross income shall be carried over as deduction from gross
income for the next 7 consecutive taxable years immediately
following the year of such loss.

Corporate tax rate of 10% (as opposed to 30%) on its net taxable
income after 7 years of Income Tax Holidays.

Accelerated depreciation of plant, machinery and equipment

may be applied if the project fails to receive an Income Tax
Holiday before full operation

Sunday, 16 May 2010

 RE FISCAL INCENTIVES
0% Value Added Tax Rate on the sale of fuel or power generated and on
purchases of local supply of goods, properties and services for the
development, construction and installation of RE plant facilities and for the
exploration and development of Renewable Energy resources and its
conversion into power.

Tax exemption from carbon credits

Cash incentive of Renewable Energy developers for Missionary

Electrification.

Tax credit on domestic capital equipment and services

Exemption from universal charge

Option to pay transmission and wheeling charges of on a per kilowatt-hour

basis at a cost equivalent to the average per kilowatt-hour rate of all other
electricity transmitted through the grid.

Sunday, 16 May 2010

 PHILIPPINES
leading the way among emerging markets

business support & I.T.

Sunday, 16 May 2010
 BUSINESS SUPPORT & I.T.
The Philippine Advantage

96 Million People. 36 Million Workforce.

450,000 university graduates per year.
English speaking. Western-oriented
culture.

Highly reliable communications and date

infrastructure.

Competitive Cost Structure for Best Value

Outsourcing

Comprehensive Government Support

Sunday, 16 May 2010

 BUSINESS SUPPORT & I.T.
The Philippine Advantage
Currently World’s 2nd top
Outsourcing Destination with highest
global industry growth rate.

Over $6 Billion in revenues per

annum, employing about 500,000
employees

Awarded Best Offshoring Destination

by the National Outsourcing
Association of the UK in 2007 & 2009

Sunday, 16 May 2010

 BUSINESS SUPPORT & I.T.
GOVERNMENT SUPPORT AND
INCENTIVES
4 to 8 years Income Tax Holiday (ITH);

Special 5% tax rate on gross income after

the lapse of ITH;

0% tax and duty on imported capital

equipment;

Exemption from 12% Value-Added Tax on

allowable local purchase of goods and
services (e.g., communication charges),
among others.

Employment of foreign nationals

Sunday, 16 May 2010

 BUSINESS SUPPORT & I.T.
OUTSOURCED SERVICES

Business Support

Customer Service & Voice Support, Finance &

Accounting, Marketing & Sales, Market
Research, Data Processing, Business, Medical
and Legal Transcription, Data Management,
Account Management, Editing & Publishing,
HR Management

Higher Value Outsourced Services

Architectural & Engineering Design, Auto-

CADD, IT & Software Programming, Mobile
Applications Programming, Financial Analysis
& Audit, Taxation Management, Paralegal
Services, Business Intelligence, Logistic Support
Services, Carbon Measurement Outsourcing

Sunday, 16 May 2010

 BUSINESS SUPPORT & I.T.
OUTSOURCED SERVICES

Multi-national Locators

Sunday, 16 May 2010

 BUSINESS SUPPORT & I.T.
OUTSOURCED SERVICES

Creative Outsourcing

Interior Design, Architectural

Services, Animation, Jewelry
Design, Fashion Design,
Furniture Design,
Landscaping

Sunday, 16 May 2010

 PHILIPPINES
leading the way among emerging markets

infrastructure development
& private public partnership
Sunday, 16 May 2010
 INFRASTRUCTURE
DEVELOPMENT
BUILD OPERATE TRANSFER & PUBLIC PRIVATE PARTNERSHIPS

The Build-Operate-and-Transfer (BOT) Center is mandated to promote Public-

Private Partnerships (PPPs) in national and local infrastructure and development
projects through the BOT Law, as well as to advocate policy initiatives in the
continued evolution of the country's infrastructure privatization policy framework.

Sunday, 16 May 2010

 INFRASTRUCTURE
DEVELOPMENT
BOT / PPP Investment Opportunities

The Build Operate Transfer Center of the Board of Investments regularly

makes available opportunities in the government’s build operate transfer
scheme in the following sectors:

Transport

Environment

Power

ICT

Property Development

Sunday, 16 May 2010

 INFRASTRUCTURE
DEVELOPMENT
LEGISLATIVE FRAMEWORK OF THE BOT SCHEME
The Philippine Constitution of 1987 recognizes the importance of Public Private
Partnerships

Republic Act 6957 (1991) established the foundations of the Build Operate
Transfer Scheme.

Republic Act 7718 (1994), a later amendment to the law, made investment in the
Program PPP – BOT Program more attractive to the private sector by:

Liberalizing the regulatory framework for pricing using market-based principles in rate setting and
adjustments to allow equity investors a competitive rate of return

a clear framework for structuring BOT contracts,

a reasonable security package to make projects financially viable for private financing;

and a coordinating and monitoring body within the government.

Sunday, 16 May 2010

 PHILIPPINES
leading the way among emerging markets

electronics manufacture
Sunday, 16 May 2010
 ELECTRONICS
OVERVIEW
Exports of electronic products, semiconductors
and components comprise over 50% of the
Philippines’ Total Exports.

Production of Semiconductors and other

components comprise 74% of total Philippine
electronics exports.

Total Philippine exports rose 43.7% year on year,

buoyed by international demand for electronics
exports.

The Industry employs more than 500,000 highly

skilled professionals.

FDI’s in electronics rose 20% in 2009

Sunday, 16 May 2010

 ELECTRONICS
INDUSTRY SUBSECTORS

Semiconductors/ Components & Devices

Electronic Date Processing Equipment

Office Equipment

Telecommunication Equipment

Communications and Radar

Control and Instrumentation

Medical and Industrial

Automotive Electronics

Consumer Electronics

Sunday, 16 May 2010

 ELECTRONICS
PHILIPPINE ADVANTAGES

Strategic location in the Far East with ease of access to the 500
million ASEAN market

Coveted Human Resrources - highly educated, english speaking

manpower pool, excellence in customer service and
communication skills.

Costs are highly competitive in the region

Government Incentives and Support, Legal Framework

100 Identified Philippine Economic Zones and 170 IT Parks

Availability of parts and components

Sunday, 16 May 2010

 ELECTRONICS
LEGISLATIVE FRAMEWORK AND GOVERNMENT SUPPORT

Omnibus Investments Code (EO 226)

Entitlements to Incentives

Equity Ownership & Equity

Requirement

Exemption from Locational

Restrictions

Special Economic Zone Act of 1995

Sunday, 16 May 2010

 ELECTRONICS
FISCAL INCENTIVES

Income Tax Holidays (0%) - 4-6 years

Duty Exemption on Imported Capital Equipment

Exemption on Wharfage Dues, Export TAx, Duty, Impost and Fees

Tax Exemption on Breeding Stocks and Genetic Materials

Tax Credits for exports and on raw materials and supplies

Additional Deductions from Taxable Income

Additional Deductions for Labor Expenses

Additional Deductions for necessary and major infrastructure works

Sunday, 16 May 2010

 ELECTRONICS
NON-FISCAL INCENTIVES

Employment of foreign nationals

Simplification of customs procedures

Tax and Dutry Free importaiton of Consigned

Equipment for a period of 10 years

Privilege to operate a Bonded Manufacturing

Warehous at ports

Additional Incentives for Regional Operating

Headquarters and Regional Headquarters

Sunday, 16 May 2010

 PHILIPPINES
leading the way among emerging markets

other investment priority sectors

Sunday, 16 May 2010
 OTHER PRIORITY
SECTORS

Tourism & Tourism

Infrastructure
Development

Sustainable Mining

Technology in
Agriculture

Sunday, 16 May 2010

 PHILIPPINES
leading the way among emerging markets

Thank you all!

special acknowledgment and thanks to:

Michael Alfred V. Ignacio

Commercial Attaché & Director

Philippine Trade & Investment Center - London

www.investphilippines.org.uk
info@investphilippines.org.uk
Sunday, 16 May 2010