In recent weeks, a 27-member delegation from Dongguan and Guangzhou visited PEZA, touring multiple ecozones. The Philippine Embassy in Beijing also disclosed that another Chinese trade mission will visit Manila in October, seeking projects in energy, technology, manufacturing, agriculture, and tourism.
Since the 19% tariff took effect, many assumed the Philippines had lost its edge in manufacturing investments. Yet, these developments suggest otherwise: investors are not only watching but already moving.
01｜Does PEZA Still Have Momentum After the 19% Tariff?
Is PEZA really losing appeal? Let’s look at the latest data before making a judgment.
As of end-August, PEZA had approved 179 projects totaling PHP 105.83 billion, a +71.54% increase YoY. Of these, 82 were manufacturing and 46 IT-BPM, with an estimated 40,638 direct jobs and USD 3.377 billion in exports.
In August alone, 29 projects worth PHP 14.87 billion were approved, down 8% YoY — but largely due to the board holding only one meeting this year versus two last year, a matter of timing rather than weakening fundamentals. Year-to-date, PEZA approvals have already reached 42.3% of the annual PHP 250B target.
In short: the data shows that export-oriented ecozone investment remains a rational choice. More importantly, this is not based on policy slogans, but on investors’ post-tariff recalibration.
Why are approvals still rising? Because projects are actually landing.
Processes are smoother, approvals faster, and ecozone facilities more complete.
The Southern Luzon Manufacturing Corridor (Cavite, Laguna, Batangas, Rizal, Quezon) now offers a full ecosystem of factories + dormitories + engineering services + port access.
Large-scale projects are also advancing: a 28,000-hectare “Super Economic Zone” in Palawan is nearing final approval (PPP model for agro-processing and plantations); in pharma, Lloyd Laboratories and a U.S. partner are building a pharmaceutical ecozone.
Rising investment figures reflect tangible improvements, not coincidence.
02｜How Should Companies Choose Rationally? Strategy First
Hot numbers don’t mean companies should jump in blindly. Three strategic questions matter most:
1. Pathway | Where are your goods going?
Export-driven → Follow the ecozone/export path.
Domestic, energy, or infra-driven → Use the domestic investment route.
👉 Calculate origin rules and tariff exposure early to avoid the wrong pathway.
2. Location | Focus on readiness, not distance from Manila.
Most new approvals this year are in Southern Luzon, where industrial parks, ports, and supply chains are integrated.
Cebu, Davao, and Mindanao represent “multi-point expansion.”
👉 Light-asset projects should prefer mature parks; heavy/long-cycle projects may use new parks for pilot lines.
3. People & Permits | Stability and compliance trump wages.
Dorms, shuttles, canteens, clinics — these “small details” decide worker retention.
ECCs, split invoicing, and 9G visas — any gap in approvals delays production.
👉 Whoever can push “land, people, and permits” in parallel will get production lines running faster.
03｜From Strategy to Execution: How Do Companies Land in Practice?
Once the strategy is clear, execution follows a four-step timeline:
Step 1. Company Incorporation
Recommended type: Corporation (joint-stock).
Required documents: proposed name, type, capital, PEZA-recognized address; project brief, anti-bribery certificate, credibility report, resumes; foreign shareholders’ passports + TIN; Filipino shareholders’ government ID + TIN (3x signed); lease contract; proof of paid-in capital (required for 100% foreign-owned firms).
Capital requirement: At least USD 200,000 recommended to strengthen credit standing.
Process: SEC registration → BIR tax registration (≈2 weeks) → PEZA application (3–4 weeks) → Bank account opening (1–2 weeks, recommend BDO, UB, RCBC).
Step 2. Factory Site Selection & Leasing (2-4 weeks)
Popular parks: Lima, Subic, Cavite, Batangas.
Process: identify → site visit → LOI → deposit → sign 3–5 year contract.
Notes: ensure PEZA accreditation for incentives; verify utilities; renting ready-built plants shortens setup (new builds take 6–12 months).
Step 3. Construction & Permits (2-3 months)
Required: factory layout, process flow, equipment list, production scale.
Environmental approval requires EIA submission (can outsource to consultants).
Advisable: hire local advisors to navigate approvals.
Step 4. Labor Recruitment & Management (1-2 months)
Channels: JobStreet, Indeed, or licensed local agencies (fees ≈ 15–30% of first-month salary).
Pay levels: workers USD 350/month; skilled workers USD 400–600; managers USD 600–1,200.
Compliance: probation max 6 months; mandatory SSS, PhilHealth, PAG-IBIG; strict labor law compliance to avoid disputes.
Key Takeaways
Hire professional advisors — the process is complex; inexperience causes costly delays.
Stage implementation — start small, then scale up to reduce early risks.
Plan the supply chain early — align logistics with factory + power setup, or risk “factories built but goods stuck.”
👉 The Philippines is not a universal solution, but for export-oriented industries, PEZA remains a rational pathway. The key is whether companies can align strategy and execution on the same timeline.
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