By Joyce Pangco Pañares | Posted on July 02, 2012 | 3:00am
President Benigno Aquino III has approved a P1.16 billion power subsidy for economic zones in a bid to attract more foreign investments.
Budget Secretary Florencio Abad said the funding was released to the Power Sector Assets and Liabilities Managament for the extension of its memorandum of agreement with the Manila Electric Company.
The fund will cover export manufacturing companies under the Philippine Economic Zone Authority.
“By extending this assistance, the administration will not only help key PEZA industries that are already established in the country,” Abad said yesterday. “The energy subsidy will likewise encourage the infl ux of foreign investments and boost the Philippines’ competitiveness vis-a-vis its neighbors.”
Mr. Aquino has approved the extension of the agreement between PSALM and Meralco until December 25 this year, or until the implementation of open access in the energy sector, whichever comes fi rst.
From January to April this year, the funding requirement for the power subsidy in ecozones has reached P453.7 million. The subsidy will be charged against the Department of Energy’s share in revenues from the Malampaya natural gas operation in Palawan.
“Through these measures, the Aquino administration intends to usher in more investment activity into the country,” Abad said. “Electricity rates in the Philippines are already the highest in Asia, and we want to mitigate the cost of doing business here so that the country becomes more attractive to foreign investors.”
With more businesses setting up shop in the Philippines, the government will be betterpositioned to open up more employment opportunities for Filipinos and, ultimately, stimulate long-term economic growth, he said.
Since Mr. Aquino took office in 2010, PEZA has generated some P465 billion in registered investments across the country’s 258 economic zones as of April.
PEZA aims to post a 12 percent increases in investments, exports and employment this year following last year’s P288 billion in total investments, a 41 percent increase from the P204 billion generated in 2010. source
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