P1 billion authorized capital
sought for CatSU Eco-Zone

PEZA DIR. GEN. CHARITO PLAZA with CatSU Pres. Patrick Alain T. Azanza after the signing of the MOU on the Eco-Zone, with the agency approving the university’s application just two days later. CatSU PRI

The House Committee on Higher and Technical Education has started hearings on House Bill No. 10175 establishing the Catanduanes State University’s campuses as an agro-industrial economic and processing zone.
Authored by Congressman Hector S. Sanchez who filed the same on Sept. 9, 2021, the bill provides that the CatSU Estate Management Authority, which shall manage the special economic and processing zone, shall have an authorized capital stock of P 1 billion, the majority shares of which shall be subscribed and paid for by the university, the national government and the local government units.
“The amount necessary to subscribe and pay for the shares of the national government to the capital stock of the CatSU-EMA shall be included in the annual General Appropriations Act,” it said, with those of the LGUs to be taken from their internal revenue allotment and other local funds.
According to reports, it was this funding provision that was vigorously defended by CatSU President Dr. Patrick Alain T. Azanza, who told the House committee that government funds are absolutely needed to make the CatSU Eco-Zone operational.
He reportedly cited the case of Batangas State University where the country’s first ever Knowledge, Innovation, Science and Technology (KIST) Park was approved by the Philippine Economic Zone Authority (PEZA) and officially launched in July 2020, two months after President Rodrigo Duterte officially designated BatStateU as a PEZA-registered special economic zone through Proclamation No. 947.
Reportedly, BatStateU’s KIST Park was not provided funding by the national government through Congress, with the university officials partnering with the Department of Trade and Industry (DTI) to allocate funding of P5-10 million each for 10 Philippine startup companies locating in the university SEZ.
“Pure PEZA lang ang KIST ng BatStateU,” Pres. Azanza told the Tribune. “Kaya tayo dumaan Congress para sa budget component ng CATSU Ecozone.”
“Otherwise, the Universitywill rely solely on internally generated funds to build the road network and other facilities, plus the locators’ investments,” he stressed. “With Congressional initiative, may pagkukuhanan tayo ng pondo.”
Under the Sanchez bill, the CatSU Eco-Zone will cover the CatSU main campus in Calatagan, Virac, the Palnab Mangrove and Fishery Research Laboratory Facility and Eco-Tourism Park in Virac, the property at Cabugao, Bato, and portions of the CatSU Panganiban campus, with a total area of 335 hectares.
It sees the Eco-Zone as a decentralized, self-reliant and self-sustaining industrial, commercial trading, agro-industrial, tourist, banking, financial and investment center with suitable residential areas, to be provided with transportation, telecommunications and other facilities needed to attract legitimate and productive investments, generate linkage industries and employment opportunities.
If the bill is approved, registered enterprises locating in the zone shall be entitled to an income tax holiday ranging from four to six years, Net Operating Loss Carryover (NOLCO), imposition of a tax rate of five percent (5%) on Gross Income Earned (GIE) instead of local and national taxes (except real property tax), accelerated depreciation, capital equipment incentives, raw materials incentives, incentives on breeding stocks and genetic materials, and exemption from wharfage dues, among others.
Of the 5% tax on GIE, the 3% shall be paid to the national government while the 2% shall be remitted by the business establishments to the municipality where the enterprise is located.
In addition, any qualified foreign national who invests an amount of US$150,000.00 in cash or equipment in a registered enterprise shall be entitled to an investor’s visa.
On the other hand, the CatSU EMA shall be composed of the concurrent CatSU president as chairman, a vice chairman from among the board of directors, the members of which will include the governor, the congressional representative, the mayors of Virac and Panganiban, and one representative each from domestic investors and foreign investors, and two representatives from Eco-Zone workers.
The PEZA board’s approval of CatSU’s application for the KIST Park and Agro-Industrial Economic and Processing Zone came just a few days after PEZA Director General Charito Plaza and her team visited the province to take a look at the proposed eco-zone sites.
Dr. Azanza thanked the CatSU Board of Regents, Governor Joseph C. Cua, Cong. Sanchez, municipal mayors and the Sangguniang Bayans, the Sangguniang Panlalawigan, Mr. Pepito and Luz dela Riva for their support, as well as the students, faculty and staff, and community residents who will be the primary beneficiaries of the economic zones.
In her message during the Stakeholders Meeting on Oct. 8, the PEZA chief emphasized the benefits of both locators and the communities in the proposed eco-zones, noting that the Philippines, despite the high cost of doing business here, remains the top choice of foreign investors due to its highly-skilled workers.
The CatSU president, on the other hand, disclosed that the university will not only be leasing land to business locators but also providing access to its students to the businesses’ technology and workforce.
“We will require locators to source the experts they need from CatSU and allow faculty research to help them in product development, earning our faculty credits as co-authors,” he said.
Dr. Azanza added that aside from the 1,000 workers needed in the construction of the Eco-Zone, 26,000 more jobs will be generated once the locators come in, spurring a lot of economic activities in Catanduanes and providing high-paying jobs without its residents going abroad.

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