The Philippine Economy:
2011 and Beyond
• Three Growth Sectors
– Business Process Outsourcing
– Tourism
– Mining
• Hard Infrastructure Support
– Transport and Telecommunications
– Utilities
– Power
– Facilities
• Soft Infrastructure Support
– Education
– Governance
– Finance
Construction Industry
Construction Output (in billion USD) and share to total GDP (%)
7.0%
8
6.0%
7
5.0%
6
5
4.0%
4
3.0%
3
2.0%
2
1.0%
1
0.0%
0
2006
2007
2008
2009
Construction-to-GDP ratio
Source: NSCB
2010
GDP
F2011
Construction Industry
Employment in the Construction Industry (in Thousand)
Construction Industry
In Terms of Size
126 3.80%
213 6.40%
1,895
57.00%
Classification
36.60%
1,217
4.90% 163
31.40%
1,044
59.90%
1,992
Large Contractors (AAA & AA)
General Engineering
Medium sized Contractors (A&B)
General Building
Small Contractors
Trade
Specialty
Total licensed contractors = 3,325
Source: PCA Industry Report
Construction Industry
21 Foreign Contractors
1
1
1
1
10
3
4
Japan
Source: PCA Industry Report
China
Korean
Thai
Austrian
Malaysian
Australian
Construction Industry
Prospects
Tourism – hotels, airports
BPO – buildings
Mining – office sites, mine development
Power – power plants
PPP / Infrastructure – PPP list
Road
Tarlac-Pangasinan-La Union
Expressway (TPLEX)
Tarlac-Pangasinan-La Union
Joint venture between
San Miguel, DMCI, &
Expressway
(TPLEX)
other local contractors
• 88
two-lane
road
88km
km initially
initially two-lane
road
Rosario
Pozorrubio
Urdaneta
• 5-year
5-year construction
construction
Carmen
BTO with
with 30-year
• BTO
30-yearconcession
concession
Php 15.18
billion cost
project
cost
with PhP3.7
• $345M
– project
with
$84M
billion government
subsidy
government
subsidy
San Miguel Corp. entry 35% current equity
• Construction
started
in 2Q equity
2010;to$43M
in PIDC (with option
to increase
51%)
DMCIHI 32% equity in PIDC
Construction started in 2Q 2010; Php1.9 B
was initially awarded to DMCI-Construction
Moncada
Paniqui
Gerona
Victoria
Tarlac
12
Construction Industry
Prospective Public-Private Partnership (PPP) List
TOLL ROADS
•
•
•
•
•
TPLEX Tarlac-La Union (ongoing)
Daang Hari- Slex Link (ongoing)
NAIA Expressway Phase 2
Cavite-Laguna (North-South) Expressway
NLEX-SLEX Connector
$345M
$36M
$235M
$233M
$477M
LIGHT RAIL
• LRT 1 South Extension
• LRT Line 2 Phase 2
$251M
$1.5B
Construction Industry
Prospective Public-Private Partnership (PPP) List
AIRPORTS
• Bohol Airport
• Puerto Princessa
• Legaspi Airport
• O&M Laguindingan Airport
$169M
$98M
$71M
$33M
EDUCATION
• School Infrastructure Projects
$233M
Real Estate
F
OFW REMITTANCES
Source: BSP
Real Estate
Issued Licenses to Sell
25,000
20,000
15,000
10,000
5,000
Jan-Apr 2010
Jan-Apr 2011
Source: HLURB
Socialized
Low cost
Mid Income
High Rise
Condo
Commercial
& Others
14,967
9,823
19,746
14,336
11,958
10,539
11,283
20,698
876
658
Real Estate
BIR: Increased Threshold for VAT Exemption in 2012
Not subjected to VAT
• Sale of a residential lot which is not more than USD46 thousand
per unit from USD35 thousand
• Sale of a residential house and lot which is not more than
USD74 thousand from USD58 thousand
• Lease of residentuial units which is not more than USD296.00
Real Estate
Foreign Ownership limitation on owning real properties
Entry Points
REIT – currently under discussion
Listed real estate companies
Energy
Source: DOE, Investment Opportunities Report by Usec. Asirit
Energy
Source: DOE, Investment Opportunities Report by Usec. Asirit
Energy
TOTAL
5,438.0
838.0 5,116.0 2,428.8
80.0
9,510.8
14,878.8
Source: DOE, Investment Opportunities Report by Usec. Asirit
Energy
Installed and Dependable Capacity, Philippines
Source: DOE, 2010 Power Situationer Report
Energy
Installed and Dependable Capacities in MW,
Total Philippines
Wind, 0%
Hydro, 12%
Hydro,
20.78%
Solar, 0%
Biomass, 0%
Wind,
0.20%
Coal, 34%
Geothermal,
15%
Solar,
0.01%
Biomass,
0.24%
Coal,
29.75%
Geothermal,
12.02%
Natural Gas,
29%
Oil, 10%
Installed capacity = 16,359 MW
Source: DOE, 2010 Power Situationer Report
Natural
Gas,
17.49%
Oil, 19.52%
Dependable capacity = 13,902 MW
Energy
Gross Generation by Plant Type, in GWhr
Source: DOE, 2010 Power Situationer Report
Energy
2010 Gross Power Generation, Philippines
Hydro, 12%
Solar, 0%
Wind, 0%
Biomass, 0%
Coal, 34%
Geothermal,
15%
Oil, 10%
Natural Gas,
29%
Total Generation = 67,743 Gwh
Source: DOE, 2010 Power Situationer Report
Energy
Generation by Ownership, in GWhr
Total Philippines
19,786 GWh
29%
71%
48,442 GWh
Non-NPC
Source: DOE, 2010 Power Situationer Report
NPC
Energy
MW
120,000
Supply-Demand
Outlook
100,000
2011-2020
80,000
60,000
40,000
20,000
-
Luzon
Required Additional Capacity
Existing Capacity
Peak Demand
Visayas
Mindanao
Committed Capacity
Required Reserve Margin
The Philippines needs a total
additional capacity of 14,100 MW
onwards to 2030
MW
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
-
2021-2030
Luzon
Required Additional Capacity
Existing Capacity
Peak Demand
Source: DOE, 2011 Power Demand and Supply outlook
Visayas
Mindanao
Committed Capacity
Required Reserve Margin