17 September 2009

Subic Freeport aims for new Chinese investments

The Subic Bay Metropolitan Authority (SBMA) will be promoting this free port as an investment site to companies based in China, as the agency intensifies its efforts to gain substantial investments despite the economic slowdown.

SBMA Administrator Armand Arreza said Subic officials will be visiting the city of Suzhou in China next week in the hope of bagging more investments after fresh capital infusions from countries like South Korea and Taiwan seemed to be tapering off.

As of the latest SBMA record, investments by Chinese firms in the Subic Bay Freeport stood this year at only US$12.7 million, the sixth biggest in terms of nationality here.

Arreza said that while SBMA’s April 2009 tally showed that Korean firms still had the biggest investment commitments here at US$2.76 billion, Korea’s investment momentum in the manufacturing sector that was started by shipbuilder Hanjin Heavy Industries and Construction Co. in 2006 had significantly waned.

“So we’re looking for more diversified investments to cushion the effects of any economic downturn on the Freeport's revenue and employment generation efforts,” Arreza said.

He added that companies based in Suzhou, which is located just outside the financial capital of Shanghai, have recently diversified from industrial manufacturing to information technology and commercial development.

This makes Suzhou-based firms more attractive to the SBMA as the latter prepares the Subic Freeport for more investments in property development, tourism, logistics, and energy.

Arreza added that the SBMA is now adopting a “wait-and-see” attitude toward investments coming from Korea, Taiwan, and the Middle East, even as it seeks new markets like China.

Arreza also stressed that Subic’s financial performance this year had remained on the positive side, despite the delay in some scheduled investments here due to the global economic downturn.

“Investments would most likely be flat by the end of this year, but Subic’s revenue performance remains up,” Arreza said..

He attributed the continuing growth in revenue to investments approved by the SBMA from two years ago. “These are now being realized,” he added.

Likewise, Subic’s export production and job generation continued to gain, although only slightly, Arreza said, citing some Subic manufacturing firms that had actually expanded operations despite the recession.

In the first seven months of 2009, the SBMA also created about 2,000 new jobs, adding to the 86,000 total number of workers recorded at the end of 2008.

Arreza added that even at this slow rate, Subic would still have a total active workforce of about 90,000 by the end of 2009.

"By attracting new investments, especially in manufacturing, from Suzhou, we hope to generate even more new jobs here," he said. (SBMA Corporate Communications)