PHL, US to break ground Clark AI hub in two years

THE Philippines is looking to break ground for its artificial intelligence (AI)-native industrial hub in two years, Bases Conversion and Development Authority (BCDA) said.

“This is to be done in phases. Within the first 2 years, we will be able to at least break ground the first phase of development,” BCDA President and Chief Executive Officer Joshua M. Bingcang said in a news briefing on Friday.

Earlier this week, the BCDA announced that it has allocated 4,000 acres (about 1,618 hectares) within New Clark City in Tarlac to build an AI-native industrial hub to support the development of an AI supply chain ecosystem here.

The facility will host the Pax Silica Coordination Office for technology firms, research institutions, and government agencies. The site will be designated as a “Golden Node,” or a new model for AI-native investment acceleration hubs.

“This will be a magnet for all other industries to come. So, it will be a haven for industrial development,” Mr. Bingcang said.

He said the hub will not be exclusive to American locators.

Trade Undersecretary Ceferino S. Rodolfo told reporters that the development will advance the Philippines’ role in the global AI supply chain ecosystem.

“There are countries and specific companies in AI-tech manufacturing, in transition energy, and in infrastructure that reached out to express the significance of Pax Silica to their investment plans,” he said, citing the interest of five companies from East Asia and America.

Mr. Bingcang noted that the investors will build the relevant infrastructure, roads, and utilities for the AI-native hub, subject to approval by the BCDA.

Under the BCDA’s proposal to the US government, the agency would grant a two-year grace period on lease payments for the property, serving as an unconditional in-kind contribution to support the initiative.

By the third year of the pact, the annual lease rate will be covered in a separate agreement.

Upon expiration of the initial lease period, the lease will be renewable upon the mutual written consent of the Philippine and US governments, on such terms as may be agreed at that time.

The property will be reverted back to the Philippine government upon termination or expiration of the lease.

Both countries have yet agree on the costs associated with the construction, outfitting, operation, maintenance, and staffing; as well as the precise location, boundaries, and legal description of the property.

The facility’s locators will be granted fiscal and non-fiscal incentives under Republic Act (RA) No. 12066 or the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy; RA 7916 or the Special Economic Zone Act, and RA7277 or the BCDA Charter.

“Further, it is understood that acceptance of this offer by the United States, specifically on relevant provisions related to in-kind contribution (i.e. grace period on lease), shall be effected in accordance with the laws and regulations of the United States, including 22 US Code § 2697 and applicable provisions of the Foreign Affairs Manual,” the BCDA said in its proposal.

The Tarlac office will function as a “principal bilateral facility” for the coordination of critical mineral supply chain security initiatives between the Philippines and the US; facilitation of a joint strategic industrial planning and infrastructure development within the Luzon Economic Corridor; and coordination of allied investment and private capital mobilization for economic security projects.

It will also support workforce development, technology transfer, and capacity-building activities aligned with bilateral economic security objectives; and other activities.

The hub aligns with the Philippines’ formal entry into the Washington-led Pax Silica initiative, which seeks to link the global supply chain on AI, semiconductors, critical minerals, and advanced manufacturing. — Beatriz Marie D. Cruz