BOI-DOF disagrees: López refutes Domínguez

The Department of Finance (DOF) and the Board of Investments (BOI), which reports to the Department of Commerce and Industry (DTI), are again at odds.

The Secretary of Finance, Carlos G. Domínguez III, and the Secretary of DTI and President of BOI, Ramón M. López, used the 46th Philippine Business Conference to express their opinions on the way in which the promotion campaigns of country investments.

On Wednesday, Domínguez, the guest speaker at the PBC inauguration, criticized the BOI for sitting down at its work and failing to convince any of the investors leaving China to locate in Southeast Asia during this pandemic.

Today, Thursday, it was López’s turn to refute Domínguez’s accusations.

“We are trapping some of the investors in the middle of the pandemic and jobs for our people,” Lopez said in his speech at the end of the two-day conference, the nation’s largest annual business meeting.

In fact, he said, nine investments with an estimated project cost of P3.2 billion have been made in the Netherlands, Taiwan, the United States and China. These projects involve the manufacture of tennis balls, travel bags, and internet and audio accessories.

There are also 14 ongoing tracks including optical device manufacturing, expansion of electronics manufacturing, home appliances, and printing devices. Interests are also pursued in the areas of automobile and motorcycle assemblies, integrated copper, textiles, personal protective equipment, engine assemblies, agriculture, and beverage and bottle caps.

There are also other areas that are considered investment leaders for 2020 from Taiwan, Japan, the US and Korea in IT business process management, energy, high-tech home appliances, and motor vehicle and optical device manufacturing.

Without naming names, Lopez refuted the CFO’s claims that BOI failed to attract a single camera phone lens maker, emphasizing, “Now, we have 11 unique lens makers. In fact, we are one of the main exporters of these products ”.

The finance chief, in his previous speech at the same place, cited as an example the manufacture of camera lenses, the demand for which has multiplied by many in the smartphone sector. “How many cameras are there normally on a cell phone? At least two, possibly three, and sometimes four. You know we don’t have a single lens manufacturer in the Philippines, ”he said.

López corrected the country’s top tax collector, Domínguez, with the Internal Revenue Office and the Customs Office directly under his department, noting that the image stabilizer on the back of his smartphones makes him one of the largest manufacturers. from Japan located in Bataan, Batangas. and Cebu exporting its products outside the Philippines. The firm employs more than 30,000 Filipinos.

In addition, the BOI president said, there are also some investors who want to continue their investment plans in the country amid the pandemic and express the hope that they will follow through on their plans to create more jobs for Filipinos.

Domínguez, the economic director of the Duterte administration, believes that the agency “does not see itself as a marketing organization.”

“The most important thing is to speak directly to these companies that have the potential to move in and offer them,” Domínguez said.

Domínguez generally compared BOI’s mandate to that of a hotel owner. “Like you’re in the hospitality business, you don’t just advertise and say, ‘Okay, come here, we’ll wait for you guys.’ You have to make offers. You identify [your potential clients] and offer them a deal, ”explained the finance chief.

Domínguez said that in addition to formulating investment rules, the BOI should go out and negotiate with “high-tech” industries that create many jobs and transfer technology to Filipinos.

“Why doesn’t the BOI come out and say it’s okay, this is the industry we want to bring in, it’s high-tech,” he said. “Rather, they sit down, write the rules, and wait for everyone to come.”

Domínguez said that “that is not the role of the BOI. The BOI should go out, identify the industries we want. Identify the companies we want to incorporate and offer them our incentive package. “

This is not the first time the two agencies have disagreed. As the investment promotion agency, the DTI / BOI must protect and use tax incentives as a way to attract investors. But the DOF, being the main government agency for maximizing funds, has to keep the government purse very close to its chest, and is therefore against granting tax incentives to investors.

Earlier, the CFO called on the BOI for opposing the DOF-backed Corporate Recovery and Tax Incentives Act (CREATE), formerly called the Business Income Tax and Incentive Rationalization Act (CITIRA).