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Investment reforms, strategic industries and digital transformation are strengthening the Philippines' position as one of ASEAN's most competitive destinations for high-value manufacturing and technology investment.

Global manufacturers are accelerating the diversification of their supply chains, while investors are increasingly looking for stable, resilient and innovation-driven destinations across Southeast Asia. Against this backdrop, the Philippines is moving decisively to strengthen its position as a regional manufacturing and export hub through policy reforms, infrastructure development and a renewed focus on future industries.
     At the forefront of this transformation is the Philippine Economic Zone Authority (PEZA), the country's premier investment promotion agency for export-oriented enterprises. Beyond attracting foreign direct investment, PEZA is steering the development of smart, sustainable industrial ecosystems designed to support advanced manufacturing, digital industries, renewable energy and next-generation technologies.
     In this exclusive interview with BuildMart Philippines and Building.hk, PEZA discusses its long-term strategic vision, recent investment achievements and the reforms shaping the country's competitiveness. It also explains why the Philippines is well positioned to benefit from global supply chain realignment, particularly under the China Plus One strategy and the Regional Comprehensive Economic Partnership (RCEP).
 

An Exclusive Two-Part Executive Interview with
PEZA Director General Tereso O. Panga

PEZA's Strategic Direction

Q: PEZA has played a significant role in attracting investments and generating employment in the Philippines. What are PEZA's key priorities and strategic objectives for 2026 and beyond?

PEZA:

Our vision for 2026 and beyond is clear: to position the Philippines as a globally competitive, resilient, innovation-driven and sustainable investment destination.
     As industries worldwide continue to evolve through digitalisation, Industry 4.0 technologies, sustainability initiatives and supply chain diversification, PEZA's strategy has also evolved. Our objective is no longer simply to attract more investments—it is to attract high-quality investments that generate skilled employment, encourage technology transfer, strengthen domestic industries and create long-term economic value.
     This strategic direction is fully aligned with the recently approved 2026 Strategic Investment Priorities Plan (SIPP), which places strong emphasis on industries expected to shape the next phase of economic growth. Priority sectors include:

• Electronics and semiconductor manufacturing
• Advanced manufacturing
• Electric vehicles and related components
• Aerospace
• Pharmaceuticals and medical devices
• Artificial intelligence and frontier technologies
• Renewable energy
• Science and innovation-driven enterprises
• Green and blue economy industries

At the same time, PEZA continues transforming economic zones into smart, sustainable industrial ecosystems based on eco-industrial and circular economy principles. Small and medium-sized enterprises are also being encouraged to participate more actively in both domestic and global value chains, ensuring that economic growth becomes increasingly inclusive.
   Global investment patterns continue to change as geopolitical developments reshape international manufacturing networks. In response, PEZA is encouraging greater supply chain localisation, automation and higher-value production activities while leveraging opportunities arising from regional trade agreements such as RCEP.
     The agency also sees significant opportunities from the continuing China Plus One and China Plus One Plus One strategies, positioning the Philippines as an ideal ASEAN manufacturing and export platform through stronger regional supply chain integration.
     Ultimately, PEZA's long-term objective extends beyond investment promotion. Every project is expected to contribute to stronger exports, greater innovation, improved supply chain resilience and sustainable national development while creating quality employment opportunities for Filipinos.
 

Investment Climate and Recent Developments

Q: What recent developments best demonstrate PEZA's success in attracting foreign direct investment and supporting investors within its economic zones?

PEZA:

The Philippines has maintained strong investment momentum despite continuing global uncertainties.
     Following a landmark performance in 2025, when PEZA approved investments worth ₱250 billion, the agency has continued building on that success throughout 2026. During the first five months of the year alone, PEZA approved 135 new and expansion projects valued at ₱124.84 billion—an impressive 88% increase compared with the same period last year.
     The growth reflects increasing investor confidence in the Philippines as an export-oriented manufacturing and technology hub, supported by a robust pipeline of high-value industrial projects.
     PEZA attributes much of this momentum to intensified international investment promotion missions across key markets including Japan, Taiwan, Vietnam, Thailand, Australia, New Zealand and other ASEAN economies. These engagements have generated growing interest from both new investors and multinational companies planning to expand their Philippine operations.

Supporting existing investors remains equally important.

To improve the ease of doing business, PEZA has accelerated its digital transformation programme, introducing fully cashless transactions and comprehensive online regulatory services that simplify compliance and speed up approvals.
    One of its latest initiatives is the Sustainability Reporting Guidance for Enterprises (SuRGE) platform, a digital reporting system that assists ecozone enterprises in meeting international ESG and sustainability reporting requirements while improving their global competitiveness.
     Recognising that future competitiveness also depends on talent development, PEZA continues investing in workforce capability through programmes such as the AI Tech Academy and the Mold Technology Support Center, which provide specialised training in advanced manufacturing, precision engineering and automation technologies.
     The agency is also strengthening domestic supply chains by connecting multinational investors with local manufacturers and SMEs through supplier matching programmes and reverse trade fairs, creating greater local value addition while improving industrial resilience.
     Together, these initiatives reinforce PEZA's broader strategy of creating investment ecosystems that are efficient, technology-enabled and globally competitive rather than simply offering attractive investment incentives.
 

New Incentives and Policy Updates

Q: Have there been any new incentives, policy enhancements or regulatory reforms that could further strengthen the Philippines' competitiveness as an investment destination?

PEZA:

Absolutely. Over the past few years, the Philippines has implemented a series of major reforms designed to create a more competitive, transparent and investor-friendly business environment.
     One of the most significant developments is the implementation of the CREATE MORE Act, which further enhances the country's investment incentive framework by offering greater clarity, flexibility and predictability for investors.
     The legislation provides more competitive fiscal incentives, extends incentive periods for highly desirable projects and simplifies tax administration—giving investors greater confidence when planning long-term operations in the Philippines.
     Complementing these reforms is the recently approved 2026 Strategic Investment Priorities Plan (SIPP), which focuses government incentives on industries expected to shape the country's future economy. These include:

• Advanced manufacturing
• Semiconductor production
• Artificial intelligence
• Cybersecurity
• Data centres
• Digital infrastructure
• Renewable energy
• Logistics
• Research and development
• Other innovation-driven industries

By aligning incentives with these strategic sectors, the government aims to accelerate industrial upgrading while attracting investments that generate higher value, stronger exports and better employment opportunities.
     PEZA is also pursuing amendments to its more than three-decade-old charter to modernise its regulatory framework and further improve investor services.
     Among the proposed reforms are streamlined procedures for ecozone proclamations, expanded regulatory authority within economic zones and greater jurisdiction over utilities and operational management. The agency also seeks to consolidate various regulatory functions under one organisation, reinforcing PEZA's long-standing commitment to providing a genuine "one-stop, non-stop shop" for investors.
   Another important initiative is the modernisation of ecozone classifications to accommodate emerging industries, including innovation districts, green technology parks, digital infrastructure and other future-ready developments that were not envisioned when PEZA was first established.
     According to PEZA, today's investors expect much more than tax incentives. They also look for efficient government services, regulatory certainty, operational stability, skilled talent and a supportive ecosystem that enables sustainable long-term growth.

 

"Our objective," PEZA emphasises, "is to address
all of these requirements comprehensively, ensuring that
the Philippines remains an increasingly attractive destination
for both new investments and business expansion."
 

To Be Continued...

In Part Two: Building the Next Generation of Industrial Growth

PEZA discusses how infrastructure, industrial parks, smart logistics and sustainable development are creating new opportunities for manufacturers, developers and international investors, while explaining why the Philippines is emerging as a strategic ASEAN manufacturing and distribution hub.


(Reported by Building.hk)