Stung by the erosion of its competitiveness as an investment haven, the state-run Subic Bay Metropolitan Authority (SBMA is stepping up its infrastructure spending in what could be a reawakening from years of complacency.
This year, the SBMA’s capital expenditure (capex budget amounts to P617 million, an unprecedented 6,740 percent increase over last year’s P9 million.
A big departure from past allocations, the SBMA plans to embark on more projects to improve infrastructure and facilities, as well as to further promote the Subic Bay Freeport view of rise of new rival Freeport zones in Vietnam, China and Myanmar.
Approved by the SBMA board of directors, this year’s outlay came on the strength of the agency’s record-breaking financial performance for 2013.
The SBMA booked last year an all-time net profit of P1.079 billion, its highest in its entire 21-year history. The SBMA’s 2013 gross revenue of P2.09 billion and earnings before interest, taxes, depreciation and amortization (EBITDA) of P992 million likewise became the highest in the agency’s history. The money will bankroll the acquisition of new dump trucks, service vehicles, and beautification of the Freeport, roads, and repair of infrastructure, airport, and other projects to make the Freeport more attractive to foreign investors.
According to figures released by the SBMA Finance Group, of the agency’s budget, P2.6 million will be spent on buildings and structures; P90 million on land and land improvements; P391 million on equipment outlay; and P134 million on information technology equipment, which received a budget of only P13,000 in 2013.
SBMA Chairman Roberto Garcia appealed to SBMA officials and employees to continue looking for new sources of revenue to further improve the agency’s financial performance.
“We are already here at this level where we can provide for what we need. We are committed to spend not only for equipment and facilities, but for our people most especially,” Garcia assured. “But we must help each other to take SBMA up to an even higher level,” he added.
The SBMA is also strengthening its law enforcement capacity to make the Subic Bay Freeport more attractive to investors and more conducive to trade and tourism.
“Let us all practice Kaizen. Let us not be contended with what we have achieved. Let us always aim to surpass our achievement,” Garcia said.
Kaizen, Garcia explained, is a Japanese word that means continuous improvement.
Garcia said that even as the SBMA posted an impressive performance in 2013, it should aspire for even greater accomplishments in order to remain competitive as a trade and tourism hub.
He pointed out that in 2013, the SBMA board of directors approved a total of P27 billion in terms of investment pledges, which was 800 percent more than the P3 billion recorded in the previous year.
Topping all other investment pledges in 2013 was the Korean firm Resom Resort, which committed P21.4 billion out of the total P27 billion pledges.
Garcia also said that the SBMA will be developing more areas for investment this year following the turnover by the municipal council of San Antonio, Zambales of the 10,000-hectare San Antonio Economic Development Area for conversion into an additional secured area of the Subic Bay Freeport Zone.
Aside from this, the SBMA has also worked out with the local government of Subic, Zambales for the free port expansion into a 650-hectare coastal land in the municipality that will be ideal for shipbuilding and ship repair.
Both territorial expansion projects will be utilized to accommodate the growing investment proposals being received by the agency, Garcia said in a statement.