SBMA Vows Consistency for Better Business Climate

SUBIC BAY FREEPORT — The Subic Bay Metropolitan Authority (SBMA) vowed to continue instituting good governance measures and policy reforms to build a better business climate in this premier free port in consonance with national government efforts to keep the Philippines number one among the best countries to invest in.

SBMA Chairman and Administrator Wilma T. Eisma said that aside from stressing the need for a consistent implementation of laws and policies governing investors in the Subic Bay Freeport, the agency is streamlining its permitting system in anticipation of greater investment yields here.

“Our primary thrust now is to improve our business processes because we want to be responsive to the needs of our locators,” said Eisma.

“We have just established a One Stop Shop where business processes are fully automated, and next month we will put into effect the 3-year validity for both the Certificate of Registration (CR) and the Certificate of Registration and Tax Exemption (CRTE), which previously had to be renewed annually,” she added.

She also said that her office has taken over the approval and release of CRTEs to further speed up the issuance of this important business document.

Eisma said the drive for a more investor-friendly climate in Subic is in keeping with President Duterte’s orders for transparency and good governance.

As a result of these initiatives, business processing time has been greatly reduced as of last year by 17% for admission permits, by 22% for declaration of admission, and by 83% for export declaration.

At the same time, the SBMA waived the $200 accreditation fee for all port-related businesses from October to December last year 2017, as part of its open-window access initiative. The same offer has been revived effective April to December this year to entice more businesses at the Port of Subic.

“We have made life easier for our locators, and we continue to strive towards this goal,” Eisma said, pointing out that the SBMA Board of Directors had already approved the reduction of documentary requirements for issuance of business registration, and, at the same time, allowed the off-site processing of SBMA ID’s to better serve investor needs.

She added that the SBMA “is working towards continuous improvement of its system, and we will implement necessary changes as long as they would not be disadvantageous to the SBMA and the government.”

At the same time, the SBMA chief clarified that the Subic agency would be strictly implementing existing policies that are meant to promote productivity and opportunity for all stakeholders in the Subic Bay Freeport.

Eisma said that along this line, the SBMA has already repossessed SBMA facilities that some business locators have left idle and unimproved, revoked the lease and development contract of investors that failed to meet their obligations, and implemented a stringent policy to collect SBMA receivables, as approved by the Board of Directors.

“There may have been some laxity in the past, but change has come, and the SBMA now strives to manage Subic with transparency, impartiality, and consistency,” Eisma stressed. “These, we believe, will bring about better business, economic sustainability, and equal opportunity for all — the very reason why the Subic Bay Freeport was created.”



April 18, 2018

SUBIC BAY FREEPORT—More international shipping companies are now using the Port of Subic as their shipping gateway, according to the top executive of Subic Bay International Terminal Corp. (SBITC).

SBITC President Roberto Locsin said more shipping lines have partnered with his company to expand their footprint in the Philippine market and are now finding Subic to be an “excellent alternative gateway to Manila.”

Locsin noted one of these as MCC Transport Singapore Pte. Ltd., a cargo-shipping specialist for the Maersk Group, which started to use the Subic terminals in four years ago to increase its presence in the Central and Northern Luzon market.

He said MCC Transport now provides feeder services for a wide range of regional and global beneficial cargo owners and manages all Intra-Asia containerized cargo for the Maersk Group.

Another Subic port user is Hong Kong-based SITC International Holdings Co., Ltd., a leading shipping logistics company in the intra-Asia area, which has successfully tapped the Filipino market by opening opportunities for clients from Northern Luzon to lessen costs in delivering products to their target market.

Locsin credits his firm’s “efficiency and high-quality cargo- and container-handling services” for the decision of SITC to expand its operations.

He also noted his firm’s partnership with Evergreen Marine Corp. (Taiwan) Ltd. beginning this month and which focuses on target VIP clients for use of the Subic port.

As of now, more than 20 shipping lines make regular calls at the Subic Bay Freeport Zone, according to figures provided by the Subic Bay Metropolitan Authority. These include international shipping firms like Singapore-based American President Lines, Mitsui O.S.K. Lines of Japan, Wan Hai Lines, K Line, South Korea’s Hanjin Shipping and Maersk Line of Denmark.

The other lines using Subic for transshipment are Avega Bros. Integrated Shipping Corp., Baliwag Navigation Inc., Chealsea Shipping Corp., Eastern Shipping Corp., Fortune Sea Carrier Inc., Matsya Shipping Lines Corp., NYK Fil-Japan Shipping Corp., Ocean Tankers Corp., Petrotrade Philippines Inc., Seen Sam Shipping Inc., Shinline Sdn BhdT, Sinotrans Shipping, SITC Container Lines Philippines Inc., Swire Shipping, T. Madsen Shipping Philippines Inc., Teekay Shipping Philippines and Uni-Ship Inc.

Locsin said the SBITC strategically serves the industries within the Subic free port and those in Northern and Central Luzon. He added the company has now included interisland Philippine barge service to connect customers from Palawan, the Visayas and Mindanao with a transshipment port.

Aside from managing the Subic container terminals, SBITC offers cargo-handling services for 20-foot and 40-foot equivalent unit container vans, as well as 45-foot boxes for full container load and specialized cargo.

(c) Henry Empeño

Subic Port Revenues Rise As Transshipment Grows

Published April 10, 2018, 10:00 PM

Port revenues in Subic Freeport improved by 6 percent in 2017 driven by substantial increase in transshipment operations and higher calls by foreign ships as the government seeks to divert cargoes from the congested Manila ports.

Data from the Subic Bay Metropolitan Authority (SBMA) showed port revenues in 2017 reached P1.207 billion from P1.137 billion in 2016.

SBMA also registered there were a total of 2,778 ship calls in 2017 or 10.4 percent lower than the 3,069 ships that sailed in 2016.  Of this total, foreign ship calls improved by 12 percent to 1526 from 1,365 while domestic ships declined by 27 percent to 1,252 from 1,704 in 2016.

Containerized cargo volume also went up by 13 percent to 140,938 TEUs (twenty-footer equivalent) from 124,707 TEUs the previous year. However, the non-containerized cargo volume decreased by 6 percent to 6,633,189 metric tons from 7,071,444 MT the previous year. Notably, transshipment registered a dramatic rise of 468 percent to 2,084 from only 368 in 2016.

SBMA also reported that their export trade value in 2017 also rose by 38 percent to $2.332 billion from $1.69 billion in 2016. Import trade value also rose by 11 percent to $1.771 billion from $1.601 in 2016.

SBMA is being developed as the country’s alternative seaport in Luzon to decongest the Manila port.

Already, the BCDA is implementing a cargo rail that will link the two freeports Subic and Clark. This 70-kilometer cargo railway will run parallel with the existing Subic Clark expressway has a project cost of R50 billion.

SBMA Senior Vice-President Joshua Bingcang said this 70-kilometer railway is part and parcel of the Luzon railway system of the government which connects from Ilocos to the western side of Tuguegarao and meet in Tarlac up to Bicol with branches in Clark and Batangas.

“This will decongest Manila by enhancing the viability of Subic and Batangas ports,” he said. In the future, the Subic-Clark railway will have a passenger service. Bingcang sees companies shifting to Subic instead of Manila ports because the cost of moving goods using a railway is just one half of the cost of using the regular truckers.

(c) Bernie Cahiles-Magkilat


Sustained strong government spending likely helped the economy grow by between 7 and 8 percent, the government’s target range for the year, in the first quarter, Budget Secretary Benjamin E. Diokno said.

Diokno told reporters last week that the gross domestic product (GDP) growth goal for 2018 was attainable, with spending on public goods and services expected to jump by some 20 percent in the first three months.

In January, government expenditures jumped 15 percent to P228.7 billion from P198.1 billion a year ago.

The Bureau of the Treasury had attributed the increase in disbursements at the start of the year to “ramped up infrastructure spending as well as the implementation of the third tranche of compensation adjustment for government employees.”

However, Diokno said he still deemed the 15-percent climb in January government spending as “slow.”

“I still find it slow. Our budget now has quadrupled compared to 10 years ago—we have a huge budget. We are making up for past neglect,” Diokno noted.

Moving forward, Diokno said he expected growth in public expenditures in February to exceed the increase recorded in January.

“In fact, our interest payments are slower. So our disbursements are real spending, which is on services,” he said.

The Treasury noted that in January, “interest payments accounted for only 19 percent of total disbursements against the previous year’s 21 percent, showing that the growth in disbursements were for productive components of the budget.”

Expenditures net of interest payments grew 19 percent to P185.2 billion that month from P155.7 billion a year ago.

(c) Ben O. de Vera
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April 1, 2018

SUBIC BAY FREEPORT—Another family-oriented theme park was unveiled here by the Subic Bay Marine Exploratorium Inc. (SBMEI), operator of the popular tourist attraction Ocean Adventure Marine Park, in time for children’s summer entertainment and  family outings.

This is the Adventure Beach Water Park, packed with water slides, wading pools, artificial rivers, and other water-themed facilities in its 1-hectare location between the Subic Bay and the triple-canopied Ilanin Forest Reserve.

The new park was formally launched last Thursday by SBMEI Chairman Jack Lin, SBMEI CEO Robert Gonzaga, and guest of honor Chairman Wilma T. Eisma of the Subic Bay Metropolitan Authority.

Gonzaga said the Adventure Beach Water Park project is part of SBMEI’s expansion program designed to further bolster the grip of Ocean Adventure, as well as that of its sister firm Camayan Beach Resort on the educational-entertainment tourism niche here.

“We want to dish out fun opportunities for family bonding that might as well be memorable and educational experiences for the children,” Gonzaga said.

“At the same time, we emphasize caring for the environment as the core value in the SBMEI complex,” he added.

The major attractions at the Adventure Beach Water Park are the three-story Twisters Slide, the Rainbow Falls at the Kidz Playground splash-and-play area, the swinging Viking ship, the Aqua Serein that simulates rain, and the River Bend artificial river that goes around most of the park area.

Aside from these, the park has Forest Grill, which serves snacks and a variety of grilled food serve in native bilao and an open-sea area for swimming and kayaking that older children and adults can enjoy.

All around the park are cabanas for visitors. These range from a pavilion that could accommodate 70 persons at P8,000 for the day, to the four-person square cabana rented out at P300. There is also one Tiki Tower good for up to 15 persons at P2,500 per day.

Gonzaga said the facility can easily take in 700 guests at one time, with admission rates at P528 for children seven years old and below, as well as for senior citizens; and P688 for adults.

(c) Henry Empeño


Philippine Daily Inquirer / 05:17 AM March 28, 2018

SUBIC BAY FREEPORT — The Subic Bay Metropolitan Authority (SBMA) is eyeing more than 21,000 hectares in the free port’s nearby communities for its expansion, according to SBMA Chair and Administrator Wilma Eisma.

In her recent State of the Freeport Address (Sofa), Eisma said the initial expansion proposals are areas in several towns of Zambales and Bataan provinces that will host resorts as well as leisure, tourism and warehousing facilities.

“Part of our priority agenda is working with our local governments for our free port expansion,” she said.

Mining, quarry

In San Marcelino town in Zambales, about 40 kilometers from this free port, 10,000 ha of land are being reserved by the local government for mining, quarry and agriculture.

In 2013, a 9,000-ha area in San Antonio town, also in Zambales, is now referred to as the San Antonio Economic Development Area. It was turned over to SBMA through a municipal council resolution and would accommodate investors in the resort and leisure trade.

Other areas for expansion are a 500-ha property in Castillejos town and a 600-ha lot in Subic town, both in Zambales, a 900-ha land in Hermosa town in Bataan and 900 ha of land in Olongapo City.

“That expansion is a long time coming and we need to make it happen,” Eisma said. “This is something that has never happened for a very long time and I’d like to take this opportunity to move that forward.”

Revenue shares

SBMA remits annual revenue shares to eight local governments which are adjacent to this free port to help finance development projects in health, education, peace and order, and livelihood “so that the contiguous communities can keep pace with developments in the Subic Bay Freeport and Special Economic Zone,” she said.

Last month, the SBMA released P147 million representing revenue shares to these local governments for the second half of 2017. The amount was 6.96 percent lower than the P150.46 million distributed for the same period last year.

Based on SBMA records, Olongapo City received P34.35 million, followed by Subic town, which got P22.46 million, and Dinalupihan town in Bataan, with P18.32 million.

Other Zambales towns that received shares were Castillejos, with P13.69 million; San Marcelino, P17.66 million; and San Antonio, P12.65 million.


The towns of Morong and Hermosa in Bataan received P12.79 million and P15.31 million, respectively.

She urged the surrounding communities to help SBMA develop estates in their areas and to start planning for the extension of the free port’s fenced-in areas because “SBMA is already running out of space to meet the space requirement of new and bigger investors.”

(c) Allan Macatuno – Correspondent / @amacatunoINQ
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Investments registered by the Subic Bay Metropolitan Authority (SBMA), operator of the country’s premier freeport zone Subic Freeport, dropped by almost half in 2017 to P3.63 billion from P6.7 1billion in 2016.

Data showed that new committed investments in 2017 in Subic Freeport reached only P2.54 billion or 60 percent lower than that P6.35 billion that came in 2016 despite the fact that more new projects were approved last year at 239 all as against only 144 in 2016.

The data further showed there were more expansion projects by existing Subic Freeport locators in 2017 in 2017, but not enough to turn the negative total inflows. There were 63 expansion projects committed in 2017 with combined investments of P1.09 billion or 203 percent higher compared to 37 expansion projects with combined investments of P0.36 million in 2016.

In terms of jobs generation, the new investment commitments are expected to generate 3,488 jobs once these projects are completed. The jobs figure was 9.82 percent lower than the 3,868 jobs in 2016.

The expansion projects, given their higher number, are also expected to generate 821 jobs or 57 percent higher than the 521 in 2016.

Despite the sharp drop in new investments, the Freeport reported a modest growth in revenues to P3.082 billion in 2017 or 4 percent more than the P2.954 billion in 2016 as most revenue sources posted positive. Leases contributed the biggest source of income at P1.527 billion or 6 percent more than the P1.446 billion in 2016 followed by port services with P961 million.

The freeport was able to post a commendable 38 percent growth in exports to $2.332 billion in 2017 from $1.69 billion in 2016. Imports also increased but at slower pace of 11 percent to $1.771 billion from $1.6 billion in 2016.

As of 2017, Subic Freeport employs a total of 128,200 workers or 14 percent higher than the 112,600 workers in 2016. The services sector employs the most with 70,650 followed by the shipbuilding and marine related services with 33,593. The manufacturing sector in the freeport also employs 15,303 and construction with 8,621 workers.

(c) Bernie Cahiles-Magkilat



SunRay Power Inc. (SPI), an affiliate of MRC Allied Inc., will develop an P8.5-billion solar project in New Clark City, the Department of Energy (DOE) announced on Tuesday.

It said that they had officially released the Solar Service Contract of SPI for the development of its 100-megawatt (MW) Clark solar project in Capas and Bamban in Tarlac province.

This will be developed in partnership with the state-owned firm Bases Conversion Development Authority (BCDA).

New Clark City, a 9,450-hectare flagship project by the BCDA, is envisioned to be the country’s first smart and green city with a mix of residential, commercial, agro-industrial, institutional and information technology developments.

The 100-MW Clark solar project will be constructed within a 256-ha property leased by SPI from BCDA.

SPI president and CEO Carlos P. Gatmaitan said the official release of the service contract was an important milestone for the 100-MW Clark solar project.

“We are excited to do this solar project in partnership with BCDA and we are looking at doing more projects with them as part of our long-term plans. The success of this project would be another proof that the private sector and the government can actually work hand in hand toward achieving a common goal—the creation of cleaner, greener, more sustainable communities,” he said.

SPI is an affiliate of listed company MRC Allied, which holds a diversified portfolio in property development and mining and is currently pursuing energy projects.

(c) Roy Stephen C. Canivel
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March 19, 2018

SUBIC BAY FREEPORT—Despite a nationwide drop in foreign investment pledges last year, the Subic Bay Metropolitan Authority (SBMA) maintained a steady economic growth in the Subic Bay Freeport Zone and even performed strongly in key financial operations like income generation and job creation in 2017.

SBMA Chairman and Administrator Wilma T. Eisma said the Subic agency recorded more than P91 million in net income last year, which was 34 percent more than the P68 million it made in 2016.

Other than this, Eisma said the SBMA posted a total revenue of P3.08 billion in 2017, compared to the P2.95 billion it recorded in 2016, an increase of 4 percent; and logged P1.55 billion in operating income, an increase of 8 percent over the P1.44 billion in 2016.

At the same time, the SBMA’s cash and investments grew by 4 percent to P4.43 billion, compared to P4.24 billion in 2016, while its total debt went down by 5 percent from P6.55 billion in 2016 to P6.2 billion last year.

“These are indicators of robust financial health,” Eisma said during the State of the Freeport Address she delivered last Tuesday before the Subic Bay Freeport Chamber
of Commerce.

“If this is not success, then I don’t know what is,” she added.

Subic’s robust performance last year came amid an overall 51-percent decline in foreign investment pledges among the country’s investment promotion agencies, which include the SBMA, the Board of Investments, the Philippine Economic Zone Authority, the Clark Development Corp., the Authority of the Freeport Area of Bataan, BOI-Autonomous Region in Muslim Mindanao and Cagayan Economic Zone Authority.

The Philippine Statistics Authority said the seven investment agencies only approved a total of P105.6 billion in new investments last year, compared to P219 billion in 2016.

Eisma said the SBMA managed to soften the effects of the investment downturn by signing in 239 new investors last year, compared to just 144 in 2016. Thus, while committed investments in Subic went down to P2.54 billion in 2017 from P6.35 billion in 2016, projected employment still grew to 3,488 from 3,868 in 2016, or a slight dip of less than 10 percent.

Eisma also pointed out that existing business locators in Subic put up 63 expansion projects last year, compared to 37 in 2016, thus generating an additional P1.09 billion in committed investments.

Overall, Eisma said the SBMA earned a total of P3.08 billion in revenues from seven sources: leases, which yielded P1.52 billion; port services, P961 million; regulatory fees, P338 million; common-use service area fees, P103 million; tourism, P16 million; environmental and tourism admission fee, P10, million; and other revenue sources, P126 million.

She said the Subic agency was just as successful in its major thrust of job creation, as it facilitated the entry of 15,500 workers into Subic’s active workforce last year, thus, increasing the manpower count here by 14 percent, or from 112,600 workers in 2016 to 128,100 in 2017.

Eisma also said with the increasing number of ship calls in Subic, the SBMA recorded a total port revenue of P1.2 billion, which was 6 percent higher than the P1.13 billion recorded in 2016.

The Port of Subic also reported $2.3 billion in total export-trade value and $1.7 billion in import- trade value last year, an increase of 38 percent and 11 percent, respectively, over 2016 figures.

With these positive financial inputs, Eisma said the SBMA contributed a total of P19.6 billion to the national economy in 2017, an amount that was 14 percent higher than the total contributions in 2016.

These included P16.8 billion in cash collections by the Bureau of Customs, which increased by 11 percent over the 2016 figures; P2.2 billion in taxes collected by the Bureau of Internal Revenue, an increase of 0.8 percent; P92 billion in dividends, or a whopping increase of 533 percent; and P0.3 billion in shares to local government units, or an 18-percent increase.

(c) Henry Empeño


Redondo Peninsula (RP) Energy Inc.—an affiliate of both the MVP and Aboitiz groups—has canceled a P46.3-billon order for two coal-fired generators from a South Korean contractor, citing the continued delay of regulatory action on related supply contracts and tariffs.

Doosan Co. Ltd. last week informed the Korea Exchange that its subsidiary, Doosan Heavy Industries and Construction Co. Ltd., received from RP Energy a letter of contract termination on March 13.

Based in Seoul, the Doosan group is engaged in infrastructure support businesses ranging from power generation, desalination and engines as well as consumer and service businesses.

Doosan said in its regulatory filing the contract with RP Energy —valued at 952.3 billion Korean won or about $891 million—was canceled because “the NTP (notice to proceed) for this project was not issued until Dec. 31, 2017, due to delayed tariff approval for the project by the Philippine Energy Regulatory Commission.”

According to the Korean firm, Doosan Heavy and RP Energy were “in negotiations for the resumption of the project” despite the latter having served notice of the contract’s termination.

When asked for comment, RP Energy declined to give any, citing the sensitive nature of ongoing talks with the Doosan group.

First announced in October 2016, the engineering, procurement and construction contract covered two 300-megawatt generators that use CFB (circulating fluidized bed) technology.

RP Energy is a partnership among Meralco, Aboitiz Power Corp., and Taiwan Cogeneration Corp. through their respective subsidiaries Meralco PowerGen Corp., Therma Power Inc. and Taiwan Cogeneration International Corp.

On Feb. 26, Meralco president and chief executive Oscar S. Reyes reiterated that a power supply agreement (PSA) between RP Energy and the distribution giant—covering 225 MW of the Redondo facility’s 300-MW Unit 1 —was submitted for action at the ERC in April 2016.

Reyes said public hearings, a technical working group review and assessment of the PSA, the tariff and other related processes were “essentially completed at the end of April 2017.”

RP Energy has also signed with Aboitiz Energy Solutions Inc. a separate PSA for the Redondo Unit 1’s remaining 75 MW of capacity.

The RP Energy PSAs were among several PSAs that involved Meralco and were still pending with the ERC, which has recently just emerged from paralysis caused by an order from the Office of the Ombudsman for the suspension of four ERC commissioners. The Court of Appeals issued last February a 60-day temporary restraining order against the Ombudsman’s decision.

“Their (PSAs’) approval with urgency is needed, even as the passage of time since their filing in 2016 has already caused significant increases in the (EPC) costs and financing costs of these new power plants,” Reyes said.

“These PSAs are required to be in place by their target commercial operations date to ensure adequate, efficient and reliable power supply and to thereby avert the risk of power outages that will be damaging to the economy, businesses and industries, and households,” he added.

(c) Ronnel W. Domingo
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