Olongapo SubicBay BatangGapo Newscenter

Monday, June 08, 2009

Hanjin raises Subic investments to $7b

SUBIC BAY FREEPORT—South Korean shipbuilder Hanjin Heavy Industries and Construction Corp. has committed to pour an additional $86 million in a ship building facility, raising cumulative investment in the free port to nearly $7 billion.

“These pledge will bring Subic’s cumulative investment total to $6.64 billion” from $5.78 billion at the end of March this year, said Subic Bay Metropolitan Authority administrator Armand Arreza.

Arreza reported the Hanjin pledge after company officials met with President Arroyo in Korea last week.

Hanjin, according to company officials, planned to infuse the investment for the local production of ship components in two stages—$29 million in September and $57 million next year.

Arreza said foreign investor confidence, especially from Korean companies, in Subic Bay Freeport would help double the number of workers here in just two years.

The SBMA said more than 85,200 workers were now employed by several companies in Subic.

“But this could easily jump to double the current figure once projects proposed by several Korean firms are realized in the next two years,” Arreza said.

Arreza cited the planned $1-billion resort complex of M Castle Inc., a Korean developer of environment-friendly luxury resorts, and the Hanjin expansion.

“With the succeeding $57 million, we will be hitting close to the $7.5-billion enhanced target that we have set for 2010,” Arreza said.

The new Hanjin commitment will place Korean investments in the Subic Bay Freeport to $2.85 billion, the biggest foreign direct investment here.

Korean companies in Subic, according to the SBMA, have put up a total of 234 projects here since 2003.

Filipino firms ranked second with 533 projects costing a combined $513.5 million.

The third biggest investors are Taiwanese companies, with 41 projects worth $256.4 million. Indian companies ranked fourth with three projects worth $101.1 million.

“Best of all, with ship components produced locally, we will have the right to claim that ships produced by Hanjin in Subic are entirely Philippine-made,” Arreza said.

Hanjin has constructed four container ships out of its Subic shipyard since 2007. The Korean company became the biggest exporter in Subic by the first quarter of 2009 after registering a freight-on-board value of $179.36 million. Hanjin simultaneously delivered its third and fourth vessels in the first quarter—CMA CGM Topaz and the CMA CGM Opal.

The Korean shipbuilder initially committed to invest $1 billion in 2006 for the ship building facility. It increased the investment by $68 million the following year. By Cecille Garcia - Manila Standard Today

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