Manila: President Ferdinand R. Marcos Jr. has taken a significant step towards enhancing the Philippines' role in the global electric vehicle (EV) supply chain by signing an executive order (EO) that establishes a comprehensive incentive program. This program is aimed at attracting investments in EV manufacturing within the country.
According to Philippines News Agency, EO 121, signed on Wednesday, introduces the EV Incentive Strategy (EVIS) Program. This initiative is designed to promote local manufacturing of EVs and their components by offering fiscal incentives that are time-bound, targeted, performance-based, and transparent. The strategy is expected to integrate the Philippines more deeply into the regional automotive supply chain, bolster its manufacturing capabilities, and align with sustainable economic growth, energy security, and environmental objectives.
The executive order outlines the goals of the EVIS Program to elevate the Philippines as a regional hub for automotive manufacturing. It emphasizes fiscal support for producing hybrid and battery EVs, including passenger cars and commercial vehicles, subject to specific qualifications under EO 121.
The Board of Investments (BOI) has been designated as the lead agency responsible for implementing and coordinating the EVIS Program, with a requirement to submit annual performance reports to the Office of the President. Additionally, EO 121 establishes the Inter-Agency Committee on Electric Vehicle Industry Development (IAC-EV) to assist the BOI in the program's administration.
The IAC-EV, chaired by the BOI, includes representatives from the Department of Finance, Department of Energy, Department of Transportation, and Department of Budget and Management (DBM). Its responsibilities include evaluating applications for program registration, recommending the issuance of Certificates of Registration, assessing participant eligibility, and advising on incentive approvals. The committee also retains the authority to recommend withdrawing incentives if participants fail to meet compliance standards.
Applicants can register up to two EV models under the EVIS Program, with the committee recommending the top four qualified applicants in cases of oversubscription, based on fiscal and economic impact and contributions to the domestic economy.
Registered participants may take advantage of Fixed Investment Support (FIS) and Production Volume Incentive (PVI), with certain criteria for eligibility. These incentives are designed to promote significant investments in EV manufacturing, with a maximum duration of ten years for benefits.
Fiscal incentives will be provided through non-transferable Tax Payment Certificates, which can offset national government tax and duty obligations, including income tax, excise tax, value-added tax, and import duties. The DBM, in collaboration with the BOI, will propose the inclusion of the EVIS Program in the National Expenditure Program for funding under the General Appropriations Act.
The total fiscal support under EO 121 is capped at PHP60 billion, with each EV model eligible for incentives up to PHP15 billion. The order becomes effective immediately upon publication.
Mitsubishi Motors Philippines Corporation (MMPC) has expressed its support for the initiative, highlighting its potential to enhance the local manufacturing industry's capabilities and competitiveness. Noriaki Hirakata, Chairman of MMPC, emphasized the importance of the EO in advancing vehicle electrification in the Philippines. Backed by Mitsubishi Motors Corporation's PHP7-billion investment commitment, the company is poised to contribute to the government's vision through local production of hybrid electric vehicles.
The company, a pioneer in electrified vehicle development, sees this investment as an opportunity to create value for the Philippine economy, support sustainability goals, and foster growth in local vehicle manufacturing.
