Metro Manila Reopens to New Ecozones, Boosting IT-BPM Industry Growth

MANILA, Philippines — President Marcos has signed an administrative order lifting a Duterte-era policy that barred the accreditation of new economic zones in Metro Manila, reopening the capital to new information technology (IT) parks and centers. This move allows the Philippine Economic Zone Authority (Peza) to resume accepting, processing and evaluating applications for new IT parks and centers in the National Capital Region (NCR). READ: Roque, Go back lifting of Metro Manila ecozone moratorium The lifting of the moratorium supersedes AO 18, issued by then President Rodrigo Duterte in 2019. The earlier order prohibited Peza from accrediting new ecozones in Metro Manila to encourage investments to locate in the provinces. In a statement on Tuesday, Trade Secretary Cristina Roque welcomed the lifting of the moratorium, saying it heeded investor demand while unlocking new opportunities for expansion in the capital. “This major policy reform is a resounding victory for the IT-BPM (information technology and business process management) sector and a decisive step forward in strengthening the Philippines’ position as a premier global destination for digital services,” Roque said. “By reopening the NCR to new IT ecozones and targeted expansion, we are addressing long-standing investor demand, unlocking significant real estate opportunities and revitalizing the ecosystem that drives our country’s digital economy,” she added. Locating in Peza-accredited buildings can be a key consideration for many businesses because it gives them access to fiscal and nonfiscal incentives. Domestic market enterprises in Metro Manila, for instance, may qualify for an income tax holiday of four to six years and enhanced deductions for five years. Metro Manila remains the country’s “primary gateway” for IT-BPM firms expanding into the Philippines, according to property consultancy Colliers Research. In a May report, Colliers said 70 percent of IT-BPM office transactions in the first quarter were recorded in Metro Manila, while the remaining 30 percent were in the provinces, mainly in Cebu and Iloilo. Considering these dynamics, the consultancy said the moratorium had become a “blunt policy tool” that “[does] not necessarily address where investments ultimately choose to locate.” Earlier, Peza Director General Tereso Panga said lifting the moratorium is expected to revive applications for new Peza-accredited developments in Metro Manila, including projects in Arca South in Taguig, Bridgetowne in Ortigas and a Yuchengco-backed innovation hub in Makati. READ: Marcos designates new lands for Cavite, Batangas ecozones Roque said reopening Metro Manila to new IT ecozones would also help position the IT-BPM industry to generate more jobs and attract additional foreign investments. This is especially crucial as the Philippine IT-BPM industry faces a more challenging outlook amid the rapid adoption of artificial intelligence. From an initial target of generating $59 billion in revenues by 2028, the industry has since lowered its goal to between $43.3 billion and $50.5 billion. INQ