Subic Bay Metropolitan Authority
The Subic Bay Metropolitan Authority (SBMA) is the operating and implementing arm of the Government of the Philippines for the development the 262 square mile (670 square kilometer) area of Subic Bay Freeport (SBF) or what was the former US Naval facility in Subic Bay into a self-sustaining tourism, industrial, commercial, financial, and investment center to generate employment opportunities.
On March 13, 1992, the Philippine Congress passed Republic Act 7227, known as the Bases Conversion and Development Act of 1992, creating the Subic Bay Freeport in anticipation of the pullout of the US naval base facilities. Section 13 of RA 7227 created the Subic Bay Metropolitan Authority (SBMA) and with free port incentives lobbied for by Richard Gordon, an amendment granting tax and duty-free privileges and incentives was inserted during the bicameral committee hearings. Consequently, Gordon, then the mayor of the City of Olongapo, became the first SBMA chairman.
Mayor Gordon with 8,000 volunteers took over the facility to preserve and protect US$8 billion worth of property and facilities when the last U.S. Navy helicopter carrier USS Belleau Wood sailed out of Subic Bay on November 24, 1992 and started the conversion of the military base into a free port like Hong Kong and Singapore.
During its fourth anniversary in November 24, 1996, Subic Bay hosted the leaders of 18 economies during the 4th APEC Leaders' Summit who were all impressed with the emerging investment haven with companies like FedEx Express, Enron, Coastal Petroleum now El Paso Corporation, Taiwan computer giant Acer and France telecoms company Thomson SA.
Richard Gordon was SBMA chairman until June 1998, when newly elected President Joseph Estrada issued Administrative Order No. 1, appointed former Bataan Representative and Harvard-trained Felicito C. Payumo in Gordon’s stead.
In August 2004, then President Gloria Macapagal-Arroyo issued Executive Order No. 340, reorganizing the SBMA’s Board of Directors, and defining the powers, functions and duties of the chairman of the Board of Directors and the SBMA administrator. A month later, Payumo was replaced when Arroyo appointed Ayala Land founding president Francisco H. Licuanan as chairman and former Development Bank of the Philippines (DPB) chairman Alfredo C. Antonio as administrator.
In 2006, President Arroyo appointed Kings Point’s US Merchant Marine Academy alumnus Commodore Feliciano G. Salonga as Chairman/Head of Agency, and Wharton graduate Armand C. Arreza as SBMA administrator.
Exports had averaged a billion dollars since 1997, jobs generated reached more than 60,000 which was twice the highest number of jobs available when Subic Bay was still a US naval base.
By 2009, the total active workforce in the Freeport had grown steadily from 63,485 in 2006 to 87,226 workers in 2009, representing a substantial increase of nearly 45.95 percent and an annual average of 6,865.50 active workers from 2006 to 2009.
Cumulative investments from 1992 to 2005 in the Subic Bay Freeport totalled US$2.346 billion. From 2006 to end-2009, the figure reached US$5.958 billion, posting a hefty increase of 153.96 percent in the last four (4) years.
From 2006 to 2009, the SBMA also managed to attract 314 foreign investment projects to the Freeport with a corresponding foreign direct investment (FDI) value of US$2.465 billion.
The biggest and most significant among these FDIs was HHIC-Phil (Hanjin Shipping), which committed US$1 billion and US$0.68 billion in 2006 and 2007, respectively, radically boosting FDIs in the Freeport by more than 12,864 percent for the period 2006-2009. In June 2006, Hanjin Shipping opened a P40-million modern training center in the Subic Bay Freeport.
Hanjin’s investments also catapulted the SBMA to the top of the list of Philippine investment promotion agencies (IPAs) in the first and second quarters of 2006, and pulled up committed investments in SBFZ that year beyond the US$1-billion mark.
The total number of approved investment projects in the Freeport likewise rose by more than 105.8 percent from 655 new projects in 2006 to 1,348 in 2009. For the same four-year period, projected employment was pegged at 102,167 in 2009, up from 52,931 in 2005.
In 2007, the SBMA leadership set the following as its core purpose and vision:
• Core Purpose: To generate economic opportunities and livelihood as a competitive maritime, logistics and eco-tourism hub in East Asia
• Vision: By 2030, Greater Subic Bay area shall be a first-world eco-urban center in Asia.
In line with this core purpose and vision, the SBMA has identified six (6) key imperatives or priorities: (1) to promote efficient, effective and transparent business processes; (2) to expand development to surrounding communities; (3) to invest in physical and manpower infrastructure; (4) to push SBMA revenues to PhP3 billion by 2013; (5) to balance development and environmental protection in the Freeport; and (6) to focus on maritime, tourism and high-value added services.
Today, the SBMA continues today to attract and maintain local and foreign investments to promote the economic and social development in the country, particularly in Central Luzon; to sustain an investment-friendly and stable business environment and assist investors in setting up their businesses and providing quality services; to pursue the development of the Freeport not only as an investment site but also as a tourism destination; and to promote environmental protection amidst rapid development.