In Photo-Malaysia’s Prime Minister Dr. Mahathis Mohammad shaking hands with BARMM’s Chief Minister Ahod Balawag Ebrahim during the latter’s visit to Malaysia

Malaysia invited to explore BARMM opportunities

KOTA KINABALU: Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) Chief Minister, Ahod Balawag Ebrahim, has invited potential investors from Malaysia and Indonesia to explore business opportunities in the region.

He has also travelled to Saudi Arabia and Turkey for investment missions and to establish closer economic co-operation with the two countries earlier this year.

Ebrahim hoped BARMM will become a major investment destination in the country as the Regional Board of Investments (RBOI) recorded PHP4.1 billion worth of financing in 2019, which is 80 per cent higher compared to last year’s PHP2.5 billion.

The optimism is anchored on the report presented recently by RBOI senior investment specialist Shamera A. Abubakar following a recent RBOI year-end reporting and investment briefing held in Cotabato City.

“The Chief Minister has become the region’s top investment promoter,” said lawyer Ishak V. Mastura, RBOI chairperson.

As a result of the regional business venture promotion, Ebrahim said RBOI-BARMM is expecting more investments in 2020. Record shows that agriculture is still the top ranked investment opportunity in the region due to ideal agro-climatic conditions and fertile lands available in the region. 

Other investment priority areas that may push through next year are infrastructure, healthcare, mining, education, energy (natural gas), manufacturing and transportation as potential investors see these industries as feasible in the Bangsamoro Region.

With the passage of the Republic Act 11439 or the Islamic Banking Act in August this year, which provides for the organisation, regulation and powers of Islamic banks to be established in the country, BARMM is leveraging its position as the only Muslim-majority region in the country by promoting investments in Islamic banking and finance.

Under the said law, Islamic banks are treated as universal banks meaning that they can establish business subsidiaries.

While there is an existing Al-Amanah Islamic Investment Bank that BARMM wants to acquire, the region can also explore setting up its government-owned Islamic bank through legislation.

Private investors with foreign partners can likewise form Islamic banks. One way of attracting investment in Islamic banking and financing is through fiscal incentives.

For instance, Indonesia’s National Committee for Sharia Finance (KNKS) Executive Director Ventje Rahardjo said during Ebrahim’s recent visit that Sharia banks still need help, through temporary tax incentives, to reach the goal. Rahardjo said such incentives could boost Sharia bank performance to ensure a level playing field with conventional banks.

While Indonesia still seeks to provide fiscal incentives to Islamic banking and finance, the BARMM through the autonomous region list of the national Investment Priorities Plan (IPP) already provides fiscal incentives to such investors in the BARMM since 2017.

“Only in the BARMM can Islamic banking and finance investors enjoy such fiscal incentives through the RBOI,” the Chief Minister said. Ebrahim said high investments in 2019 can be attributed to the relative peace the Bangsamoro Region is now experiencing, brought about by the implementation of the Bangsamoro Organic Law (BOL) which was overwhelmingly ratified by the people last January.

“This can also be viewed that more investors are attracted to investing in the region to take advantage of the improving business climate,” he said.

He added that regional officials are doing their best to ease the process of doing business in BARMM by assisting investors to facilitate their investment needs from a business plan to reality and, most importantly, the granting of incentives or tax breaks.

“BARMM is open for business. We want investors to come and create jobs and incomes to help us attain our goal of sustainable development and inclusive growth by establishing the foundation of self-governance through moral governance,” Ebrahim said.

In 2019, RBOI has registered five investment projects in the BARMM. The biggest investor was Lamitan Agri-Business Corporation (LABCO) to engage in Cavendish banana plantations worth PHP1.8 billion in Lamitan City, Basilan province.

The second top investor was JMI Sand and Gravel Truck Services Corporation, which invested PHP1.4 billion in sand and gravel project located in Gang, Sultan Kudarat, Maguindanao.

The third biggest investor is Maguindanao Corn Development (MCD) DSA-1 Corporation which is into a modern yellow corn production project costing PHP515 million located in Datu Saudi Ampatuan, Maguindanao.

Wao Development Corporation (WDC) came fourth, investing PHP306 million for a new pineapple packing plant in Wao Municipality, Lanao del Sur.

The fifth is Hong Kong Feng Sheng Heritage Philippines Inc. (HK FSH) based in Balabagan, Lanao del Sur investing PHP100 million to establish an abaca fiber processing plant.

“A total of 2,724 jobs are expected to be created from these projects,” Abobakar said. He said that for this year, the province of Maguindanao continues to dominate in investment generation, followed by Lanao del Sur and Basilan. 

BARMM covers the provinces of Maguindanao, Sulu, Tawi-Tawi, Basilan and Lanao del Sur; the cities of Cotabato, Marawi and Lamitan; and the 63 villages in six towns of North Cotabato province.