THE PROJECT to redevelop the shuttered Hanjin shipyard in Subic has been granted fiscal incentives on P17 billion in planned upgrades to the facility by the Fiscal Incentives Review Board (FIRB), the Department of Finance (DoF) said.
The incentives were endorsed by the Subic Bay Metropolitan Authority (SBMA) and received the backing of Finance Secretary and FIRB chairman Carlos G. Dominguez III, the DoF said in a statement Tuesday.
Mr. Dominguez cited the shipyard redevelopment project’s “economic potential, given its strategic location near the West Philippine Sea.”
He said the incentives include a special corporate income tax (SCIT), a value-added tax (VAT) and duty exemption on imports, and VAT zero-rating on local purchases.
“We expect the project to create jobs in the adjacent communities, increase economic activity as well as support the national government’s economic recovery efforts,” Mr. Dominguez was quoted as saying. “The resumption of operations in the shipyard will also prompt development and productivity in the area, which can attract more investment opportunities into the country.”
Hanjin Shipyard, formerly owned by the now-bankrupt South Korean company Hanjin Heavy Industries and Construction (HHIC-Phil), was acquired by US private equity firm Cerberus Capital Management for $300 million.
The DoF also said the benefits of an upgraded shipyard include its use by the Philippine Navy (PN) and its potential to attract export locators.
The PN will occupy the northern area of the yard, according to a Government Service Insurance Service Bid Bulletin.
“It will be beneficial, specifically to the Navy, as it will involve the safety and efficiency of the Philippine government ships’ performance and, consequently, strengthen national security,” the DoF said. — Tobias Jared Tomas