President Duterte approved the 2022 Strategic Investment Priority Plan (SIPP) on 24 May 2022 which lists the economic and business activities that may be given investment incentives under the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act. The SIPP becomes effective fifteen (15) days upon publication in a newspaper of general circulation.
With the approval, the Philippine Board of Investments (BOI), as the country’s lead industry development and investments promotion agency (IPA) which headed the crafting of the SIPP in coordination with the Fiscal Incentives Review Board (FIRB), other IPAs, and government agencies administering tax incentives, and the private sector, is set to promote the salient features of the Plan in key regions and cities in the country and target foreign markets as well, informing industry players, concerned stakeholders, and prospective and existing foreign investors on the business opportunities awaiting them, and how they can further grow their businesses by availing of the investment incentives under the SIPP such as income tax holidays and duty-free importation of capital equipment.
File Photo from Philippine News Agency (PNA)
“The approval by the President of the SIPP is opportune, as the country is heading towards economic recovery. This will catalyze industrial development,” Trade Secretary and BOI Chairman Ramon Lopez said, pointing out that the SIPP serves as an engine toward the national industrial revolution to beef up industries and yield more diversified, complex, and sophisticated products and services in the Philippines.
Particularly, the SIPP adopts the 2020 IPP as Tier I as the base structure for Philippine Development; determines products or services which are not locally produced, for consideration for Tier II; and identifies high technology activities critical to the transformation of the economy and attracting technology investments for Tier III.
The SIPP’s Tier I contains the preferred activities under the 2020 IPP, which include all qualified activities relating to the fight against the COVID-19 pandemic. On the other hand, Tier II has activities that will fill in the gaps in the Philippine industrial value chains, which are critical in promoting green ecosystems, ensuring a dependable health system, achieving robust self-reliance in defense systems, and transforming into modern, competitive, and integrated and self-reliant industries and agriculture by filing in value chain gaps and encouraging industries for import substitution and competitively ensure food security.
Under Tier III are activities that will accelerate the transformation of the Philippine economy as well as utilize Industry 4.0 technologies such as the use of the automated system, smart machines/systems, industrial internet of things (IIOT), cloud computing, cognitive computing, advanced robotics, artificial intelligence, 3D printing, among others.
Under All Qualified Activities Relating to the Fight against the COVID-19 Pandemic are the following: essential goods and services; all Qualified Manufacturing Activities such as Agro-Processing; agriculture, fishery, and forestry; strategic services such as integrated circuit design, creative industries, and telecommunications; mass housing; infrastructure and logistics including LGU-PPPs; innovation drivers including research and development, commercialization of new and emerging technologies, and startups; inclusive business models such as agribusiness and tourism; environment or climate-change related projects; and energy.
Under Export Activities are production and manufacture of export products; services exports such as voice services; and other activities in support of exporters such as repair and maintenance and logistics services.
While activities under Special Laws are industrial tree plantation; exploration, mining, quarrying, and processing of minerals, publication or printing of books; refining, storage, marketing, and distribution of petroleum products; rehabilitation, self-development, and self-reliance of Persons with Disability; renewable energy; tourism; and energy efficiency and conservation.
The SIPP supersedes the 2020 Investment Priorities Plan (IPP) which served as the transitional SIPP to ensure the continued promotion of investments and processing of qualified projects.
Trade Undersecretary and BOI Managing Head Ceferino Rodolfo, meanwhile, emphasized that the SIPP has an enormous role in the country’s goal of bouncing back from the economic ramifications brought about by the pandemic. The SIPP will sustain the momentum towards economic recovery, as it will urgently create and recover jobs for Filipinos, he added.
“We are truly making it happen in the Philippines, as the SIPP aims to hasten the transformation of the country’s economy into a modern and efficient one with highly-developed infrastructure,” the Undersecretary said, “it is the reason why I firmly believe that with this approval, we could not only head toward full recovery of the Philippine economy but also in ensuring that we come out of this pandemic with technology-driven industries anchored on a strong industrial base.”
“We have to competitively develop our capacity to improve our resiliency,” said the Undersecretary. The approved SIPP, the Undersecretary underscored, will also position the Philippines as a regional hub for carbon-reducing activities, as well as attract more investments that promote Innovation, Research, and Development, use of the latest technology, among others.
In February this year, the BOI conducted a virtual public consultation with hundreds of participating stakeholders on the SIPP. During the said online event, the BOI officials highlighted that the SIPP was anchored on the new industrial strategy – the Inclusive Innovative Industrialization (i3S) – that is imperative for the Philippine economy to strengthen its competitiveness by the adoption of advanced technologies in agriculture, manufacturing, and services.
Consistent with the collective aspirations of the Filipino people in Ambisyon Natin 2040, and the Science, Technology and Innovation (STI) foresight of the Philippines in Pagtanaw 2050, the SIPP is an important tool towards achieving the country’s goals to sustain momentum towards recovery, particularly in urgently creating jobs; to competitively provide for the Filipinos’ basic needs; hasten transformation into a modern and efficient economy with highly-developed infrastructure; to attract investments that promote innovation, research and development, use of latest technology, and to position the Philippines as regional hub for carbon-reducing activities. END