The Philippine Economic Zone Authority (PEZA) said 18 registered IT Buildings and Parks hosting 60 POGOs (Philippine offshore gaming operators) are at risk of becoming ghost buildings on the Chinese government’s crackdown against offshore gambling operations by its nationals, including in the Philippines.

Philippine Economic Zone Authority (PEZA) logo

“This will have a big impact on us as this will create high vacancies in several of our IT Centers/Parks,” said PEZA Director-General Charito B. Plaza.

As such, Plaza has reiterated the agency’s position for Malacañang to lift the moratorium on the approval of PEZA IT Centers/Parks located in Metro Manila.

“Hence, the Office of the President and the Department of Finance must consider lifting the moratorium in Metro Manila so these buildings can immediately be occupied back by our IT/BPO industries which were earlier deprived when POGOs were preferred by IT Centers as these POGOs offer to triple their rental than the legitimate IT/BPOs,” Plaza said.

On June 17, 2019, Malacañang issued Administrative Order No. 18 declaring a moratorium on the declaration of PEZA IT Centers/Parks in Metro Manila to push these real estate developers to locate in the regions to help develop the countryside.

The Malacañang order has affected 22 applications for Metro Manila IT Centers/Parks out of the total 42 applications endorsed by PEZA for Presidential proclamation since June 2017. The pending applications were granted 6-month transitory period to complete all documents.

PEZA has also approved 131 special IT ecozone projects for Metro Manila but have not yet endorsed these to Malacañang. Of this figure, 121 are IT Centers and 10 are IT Parks.

These PEZA approved and endorsed special IT ecozones are still completing the new requirements imposed by Malacañang like land title and lot segregation documents which are difficult to procure.

“We are also asking the President to allow for a longer transition period,” said Plaza, who admitted being caught by surprise of the Malacañang order.

The IT-BPM industry led by the IT-Business Process Outsourcing Association of the Philippines (IBPAP) and the Contact Center Association of the Philippines also supported PEZA.

IBPAP President and CEO Rey Untal said the AO has “near-term detrimental impact” because Metro Manila is expected to drive growth in the IT-BPM industry this year.

Untal said the industry has been very supportive of the government’s effort for locators to move outside of Metro Manila to develop the countryside, but he likewise stressed that firms would still prefer Manila as its headquarters based on their “hub and spoke” model.

To make the IT-BPM firms successful in the countryside, Untal said, the hub in Metro Manila must also be strong.

Source: https://business.mb.com.ph/2019/08/25/peza-fears-it-centers-turning-ghost-buildings/