Metro Manila has been the center of development ever since its establishment as the center of the Philippines. With seemingly endless business opportunities attracting job seekers and investors into the region, it is no surprise that the Metro has become congested. Nowadays, vehicular traffic within Metro Manila can effortlessly lengthen a normally 20-minute travel to a 1-hr journey; and at the same time, it should be worth mentioning that not much prime properties are left for development.
The current administration has recognized this problem and has set its eyes in opening opportunities for other regions in order to reduce poverty. Within the next several years, our government has embarked on a spending-spree directed towards the development and improvement of infrastructure. Dubbed as the “Golden Age of Infrastructure”, the Duterte government has put forward over 70 infrastructure projects under the Build, Build, Build Program in hopes of encouraging investors and developers to test the waters in areas outside Metro Manila. One particular region that the government has marked for development is Central Luzon, leveraging on the success of Subic in Zambales and Clark in Pampanga.
Economic Giants of the North
Subic Bay Freeport and Clark Freeport have sparked the development of Central Luzon ever since their establishments as Freeports. Being special economic zones, the Freeports are offering tax-free and duty-free privileges on companies willing to invest within them. Sure enough, they have been attracting investors from various countries and have successfully transformed the former military bases into premier economic zones.
Clark and Subic Freeports are managed by autonomous entities under the government – the Subic Bay Metropolitan Authority (SBMA) and Clark Development Corporation (CDC).
Subic Bay Freeport
SBMA has been managing the entire 67,000 hectares of Subic Bay since its establishment in 1993 and has only spelled development for the Bay since then. In the recent State of the Freeport Address, the report almost sounded like praise as the figures were more than enough to show the growth within the freeport. Net income and total revenues increased by 34% and 4%, respectively, while the total workforce employed within increased by 14%. The Port of Subic, the strongest asset and edge against other freeports, also reported an increase of 6% in revenues.
Further, SBMA Chairman Wilma Eisma said that they are expecting the investments this year to top the committed and expansion projects recorded in 2017. SBMA has identified around 3,000 hectares at the Redondo Peninsula which shall be opened for development upon the completion of a new master plan for the district. Being another port area, this would-be development zone is perfect for port projects, fuel depots, natural and sustainable energy generation, and more industrial estate operations. Other untapped areas will also be opened for development by creating new road networks within Subic Bay. With these new policies, the Subic agency is expecting to attract more investor-companies along the way.
Clark Freeport
CDC is in charge of the 4,400-hectare main zone and 27,600-hectare subzone. Just like SBMA in Subic, CDC has been managing the Freeport effectively. In 2017, CDC's net income has increased by 32% while gross revenue increased by 20% as well. To add to that, CDC has attracted 54 more locators in 2017, pushing the employment to breach the 100,000-mark, the highest since 1993.
For 2018, CDC President Noel Manankil is looking forward to more investments entering the Freeport. The positive outlook stems from the support that Clark, together with the entire Central Luzon, is getting from the government. For one, the current administration has been expediting the expansion of the Clark International Airport – the construction of a P9.3B passenger-terminal that has already started in December 2017. Another project that is seen to positively impact the economic and business climate in Central Luzon is the New Clark City of Bases Conversion and Development Authority (BCDA). It is a planned community, approximately 9,450 hectares, which will feature residential, commercial, and agro-industrial park developments.
The growing northern economy serves proof that investing in areas outside Metro Manila is taking a turn for the better. Coupled with a well-thought investment plan and a well-timed entry, pioneering in a new market can take you and your investment to the top. Pinnacle Real Estate Consulting Services Inc.’s Research and Consulting Department offers services such as Market Studies, Feasibility Studies, and Highest & Best Use Studies which would help in making sound investment decisions. Call (02) 859-1000 for inquiries and appointments today!
By Gian Carlo Apostol | May 23, 2018
