Republic of the Philippines BCDA Bases Conversion Development Authority

1. Republic of the PhilippinesBCDABases Conversion Development Authority

2. R.A. 7227 The Bases Conversion Development Authority (BCDA) was created pursuant to Republic Act No. 7227, known as the Bases Conversion and Development Act of 1992. The BCDA Mandate • Raise funds for conversion projects & military modernization through privatization (sale or lease) of Metro Manila Camps; • Accelerate the conversion and development of former U.S. baselands; • Promote social and economic development in affected communities. Serving directly under the Office of the President of the Republic, the BCDA is authorized by R.A. 7227 to pursue the following: 1. The disposition and privatization of Metro Manila camps, 2. The conversion and development of former baselands and facilities into Special Economic Zones, and 3. Social development which consists of the provision of housing and livelihood for the dislocated families affected by development projects undertaken by BCDA.

3. WHERE WE OPERATE BCDA operates in Metro Manila, Central Luzon and Northern Luzon. Poro Point Camp John Hay Our development strategy consists of determining the economic and business potentials of the former baselands, converting them in partnership with the private sector, and developing growth corridors to spur economic growth and development of the regions concerned. Subic Bay Clark Air Base Fort Bonifacio Villamor Air Base Metro Camps

4. Master Planning the Future Fort Bonifacio Global City The 440-hectare Bonifacio Global City is the single largest piece of prime property in the country. Formerly the site of a military camp, the Global City is fast taking shape as a 21st century urban metropolis. Taking its inspiration from the world’s greatest cities, the Global City will be the most modern and innovative urban center in Southeast Asia.

5. Master Planning the Future Fort Bonifacio Global City Already, high-rise office and residential developments have begun to define the Global City’s skyline. Infrastructure and utilities, all of world-class quality, have been installed. Access roads and interchanges have also been completed to improve traffic flow to and from the Global City. Complementing these is a healthy mix of spacious parks and green landscapes, as well as, venues for arts, culture and entertainment that makes for a truly well-crafted metropolis. $419 million in infrastructure developmentcosts

6. Conversion to Special Economic Zones SPECIAL ECONOMIC ZONES Using the funds generated from the disposition of Metro Manila camps, we have embarked on development projects in these former military bases converted into Special Economic Zones. • Subic Bay Freeport and Special Economic Zone • Clark Special Ecozone • Poro Point Freeport and Special Economic Zone • John Hay Special Economic Zone • Morong Special Economic Zone

7. Conversion to Special Economic Zones THE BASELANDS TODAY These former bases are rapidly attracting international investors because of their advantageous location, favorable business environment, facilities and infrastructure, incentives offered, and abundant supply of world-class manpower resource. Growth centers with: • Strategic location • Favorable business environment • World-class facilities and infrastructure • Tax and duty-free incentives • Highly-skilled manpower resource

8. Conversion to Special Economic Zones To create an atmosphere conducive to business and investments, the special economic zones offer special privileges and incentives. Tax and Other Incentives First, the zones are managed as a separate customs territory, ensuring free flow of finished articles and raw materials into and within the zone. • SEZs managed as a separate customs territory • Tax and duty free importation of machinery and articles for SEZ-registered companies • Unlimited purchase and consumption of tax and duty-free consumer goods within the zone • 5% levy on Gross Income Earned (GIE) instead of the regular national and local taxes • 100% foreign equity allowed Business enterprises do not pay taxes and duties on imported capital equipment, materials and supplies. Businesses inside the zones also do not pay regular local and national taxes, and instead, pay only 5% of gross income earned minus allowable deductions. Also, 100% foreign equity is allowed inside the economic zone.

9. Investments in Growth Investments Data: US $ 5 billion in private investment has been poured into Subic and Clark since 1992 Top investors: • Taiwanese • American • Japanese Employment Data: 109,981 jobs generated since 1993 (as compared to the 60,000 peak employment level before the U.S. bases pull-out) BCDA SUBIC AND CLARK SEZ

10. Investments in Growth Development of various facilities at the Subic Bay Freeport and Special Economic Zone have been completed. Subic Bay Freeportand Special Economic Zone $ 8Billion in infrastructure assets These include the cargo and container port, the Cubi International Airport, the light and medium industrial estate, the central business district, tourism facilities and sports and recreation areas. • Cargo and container port • Cubi International Airport • Industrial Estate • Central Business District • Tourism, Sports and Recreation Areas

11. Investments in Growth The Clark Special Economic Zone consists of a 2,200-hectare aviation complex, and another 2,200 hectares of tourism, industrial and residential complexes in the Main Zone. Clark Special Economic Zone $ 5 Billion in infrastructure assets The 28,000-hectare Clark Sub-Zone is envisioned to be developed as an agri-industrial area. • 2,200-ha. Aviation Complex • 2,200-ha. Main Zone (Tourism, Industrial and Residential Areas) • 28,000-ha. Sub-Zone Managed by the Clark Development Corporation, the implementing arm of BCDA, the Main Zone houses over 200 locators mostly involved in industrial and commercial projects, as well as aviation, tourism, housing and other service-oriented businesses.

12. Investments in Growth Poro Point Special Economic and Freeport Zone • Tourism/commercial development • Modern seaport and bulk handling facilities • Industrial Estate • Airport Development Catalyst for the North Luzon Growth Quadrangle

13. Investments in Growth Camp John HaySpecial Economic Zone • World-class golf course - opened April 1999 • Construction of Country Homes/ Manor - ongoing

14. Consolidating Gains The Alliance shall enable Subic and Clark to synchronize efforts in developing a regional maritime and aviation logistics hub that will result in the complementation and sharing of resources, infrastructure and facilities between the two zones thereby propelling economic growth in Northern and Central Luzon. SUBIC CLARK

15. Subic-Clark-Tarlac Toll Road Project • The toll road project will involve the construction of the Subic-Clark-Tarlac toll road with two sections: the Subic-Clark segment and the Sta. Ines, Mabalacat-Tarlac section. Objectives • Provide a direct link among Clark Ecozone, Subic Freeport Zone and Tarlac. • Pursue Subic-Clark alliance. The project has two sections • Subic-Clark section (55.8km) • Clark Tarlac section (33.5km) Project Cost $360.36M Project Duration 62 Months Clark-Tarlac Toll Road Section It will provide a direct toll road connection between three vital development areas in Central Luzon. Total project cost is Php18.739B. Eighty five percent (85%) of the total project cost will be funded by the special yen loan facility of the JBIC while the remaining 15% will be shouldered by the BCDA as equity contribution. Subic-Clark Toll Road Section

16. Consolidating Gains The Alliance Program will provide a unique opportunity for Subic and Clark to combine their strengths and coordinate their investment promotion efforts in establishing a regional maritime and aviation logistics hub offering world-class facilities for the manufacture, storage and movement of goods, data and services for international distribution. A Strategic Development Approach • International maritime and aviation transshipment and logistics hub; • World-class maritime and aviation infrastructure and support services; • Highly-skilled human resources; • Competitive fiscal incentives; • Secure residential and work environment; • Modern amenities The Alliance will aim to provide world-class infrastructure and support facilities, international access of people and goods through the airport and seaport, access to abundant and highly skilled manpower and competitive fiscal incentives. Subic-Clark Alliance Development

17. Consolidating Gains Manila - ClarkRAPID RAILWAY SYSTEM To enhance access to Clark and spur the development of the Central Luzon, BCDA is spearheading the Manila-Clark Railway System. Once completed, travel time between the Clark International Airport and the Fort Bonifacio Global City will take less than an hour. Total Project Cost: US$2.5 B

18. Key elements for a successful conversion program: • Acomprehensive legal mandate • Active private sector involvement • Extensive infrastructure support • Socio-economic support for affected families • Local community participation

19. Throughout the years of bases conversion, BCDA has learned several important lessons, these are: Lessons BCDA has learned: • Private sector involvement is very critical to a Bases Conversion Program. 1) Private Sector involvement is very critical to the success of the Bases Conversion Program; • Liberal,sound and transparent government policies and programs are important to nurture active private sector participation. 2) Liberal, sound and transparent government policies and programs are important to nurture active private sector participation; and • Strong local community support is indispensable. 3) Strong local community support is indispensable.

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21. BCDA CORPORATE CENTER Gozar St., Villamor Air Base, Pasay City, Philippines PO Box 7343, D.A.P.O. 1301, Pasay City, Philippines Tel. No. (632) 551-3006 to 12, Fax No. (632) 551- 5122 www.bcda.gov.ph