PEZA eyes more investments from South Korea

By Justine Irish D. Tabile, Reporter

THE PHILIPPINE Economic Zone Authority (PEZA) is seeing South Korea as among the potential sources of investments next year amid a free trade agreement (FTA) and the investments that will be attracted by Samsung Electro-Mechanics Philippines Corp.’s P51-billion expansion.

“For 2026, our best bets for foreign direct investments are Japan, South Korea, the US, China, and Singapore,” PEZA Director-General Tereso O. Panga told BusinessWorld.

“We anticipate Korea to still come in strong owing to the Philippines-South Korea FTA and the huge expansion of SEMPHIL, which should trigger more Korean investments,” he added.

The Philippines-South Korea FTA took effect on Dec. 31, 2024. This was the Philippines’ third bilateral FTA.

Meanwhile, SEMPHIL’s P50.7-billion investment marked the first project to be granted presidential incentives under the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy Act.

For next year, PEZA is expecting to approve P300 billion in investment pledges, after greenlighting P261 billion worth of projects this year.

This year’s approval surpassed the P250-billion target the agency set for the year, the highest since the P295.1 billion worth of investment pledges approved in 2015.

Japan came out as the top source of foreign investments in 2025, accounting for P29.169 billion of the total approvals.

“The Japanese consistently have always been our biggest foreign investor in PEZA. However, in 2024, Korea emerged as our biggest country source of economic zone (ecozone) investments due to the big-ticket and high-tech project of SEMPHIL,” Mr. Panga said.

“For 2025, Japan has regained its No. 1 spot, dislodging Korea at No. 3. Moreover, we saw a significant increase (in investments) from the Cayman Islands, Singapore, China, and the US,” he added.

Investments from Cayman Islands totaled P16.694 billion in 2025, while investments from South Korea reached P11.46 billion. Investments from Singapore, China, and the US reached, P11.186 billion, P6.788 billion, and P6.26 billion, respectively.

Completing the top 10 sources were Hong Kong (P5.112 billion), Germany (P4.456 billion), Australia (P3.718 billion), and the Netherlands (P2.674 billion).

In 2024, the top five sources were South Korea (P51.269 billion), Japan (P13.736 billion), the Cayman Islands (P9.116 billion), the Netherlands (P5.726 billion), and Malaysia (P4.555 billion).

On Dec. 22, the PEZA Board met to approve seven new projects with investment costs totaling P23.689 billion. These are expected to create 3,821 jobs and $1.302 billion in exports.

After the board meeting on Monday, the agency approved a total of 314 projects worth P260.89 billion this year.

These include manufacturing, information technology and business process management, logistics, utilities, facilities, domestic market enterprise, tourism, and ecozone development projects.

This year’s approvals are expected to generate 78,741 jobs and $11.522 billion in export revenues.

Next year, PEZA is hoping to create new types of ecozones that will cater to various industries, following the proclamation of 10 new ecozones this year.

These ecozones include the Tagbilaran Uptown IT Hub 2, two expansions at the Lima Technology Park, The Upper East, SM City Santa Rosa IT Center, and De La Salle University Innovation Hub.

The others were West Cebu Industrial Estate, 8912 Aseana Avenue, Allcoco Development Corp. Industrial Estate, and Filinvest Innovation Park.

“There are still 14 ecozones in the pipeline ready for proclamation. And as more ecozones are proclaimed by the president, like that of the first mega ecozone in Ihawig, Palawan, and a Pacific gateway in Pantao, Albay, we are confident that the influx of investments and expansion of projects at PEZA will continue,” said Mr. Panga.

“Locators are seeing the value of expanding and consolidating their supply chains in the Philippines,” he added.

John Paolo R. Rivera, a senior research fellow at the Philippine Institute for Development Studies, said that the realization of ecozone investments will partly depend on consistent incentives.

“Sustaining these inflows into 2026 will depend on consistent incentives, faster project execution, reliable infrastructure, and a predictable regulatory environment,” he said in a Viber message.

“Without these, even strong investor interest may not fully translate into realized investments,” he added.

Despite lackluster investor confidence in the Philippines due to corruption, Mr. Rivera said the increase in investments can be attributed to “trusted partners and technology-driven projects.”

“Japan’s return to the top reflects its long-term commitment to manufacturing and supply-chain integration in the country, while Korea’s surge highlights how big-ticket, high-tech investments and FTAs can quickly shift investment rankings,” he said.

“Policy stability, trade agreements, and the ability to host complex, high-value projects matter more than volume alone,” he added.