Manila eyes new ecozones to ease BPO space crunch
MANILA, PHILIPPINES — The Department of Trade and Industry is preparing to formally endorse the lifting of Administrative Order 18 — a 2019 restriction that blocked PEZA from approving new IT-BPM ecozones in Metro Manila — as Q1 2026 data confirms 70% of Philippine IT-BPM industry transactions remain concentrated in the capital despite seven years of restricted ecozone supply.
Manila’s seven-year PEZA ecozone freeze nears its end
Administrative Order 18, issued under President Duterte in 2019, was designed to redirect BPO and GCC investment from Metro Manila toward provincial cities — a decentralization push that Q1 2026 transaction data shows has not redistributed demand at the pace the policy assumed.
More than 1,600 PEZA-registered IT-BPM operators compete for compliant CBD office space in a market closed to new ecozone supply since the ban took effect, a constraint property firm Colliers identified as a direct operational pressure on operators seeking expansion space in Manila’s established business districts.
Seven years of restricted PEZA ecozone supply in Metro Manila did not redirect IT-BPM demand to the provinces — it concentrated demand against a frozen supply base in the country’s largest IT-BPM delivery hub.
Trade Secretary Cristina Roque stated the DTI “will soon endorse to President Ferdinand Marcos Jr. the lifting” of Administrative Order 18, with the Department of Finance also backing the reversal ahead of formal presidential action, the Manila Times reported.
Makati, Arca South, Bridgetowne enter PEZA pipeline
Lifting AO 18 would allow PEZA Director General Tereso Panga to advance applications from properties sidelined since 2019 — including office developments in Makati, Arca South in Taguig, and Bridgetowne with BPO-grade specifications excluded from PEZA registration for seven years.
Metro Manila’s 70% share of Q1 2026 IT-BPM transactions confirms the capital’s structural role as the sector’s primary delivery base — a concentration that makes the NCR ecozone restriction more operationally consequential than a comparable supply freeze elsewhere in the country.
For IT-BPM and GCC locators, the AO 18 reversal opens formal NCR ecozone application pathways for the first time since the Duterte administration, restoring incentive-eligible supply options absent from a market that has continued to absorb sector growth since 2019.
For the 1,600-plus PEZA-registered IT-BPM companies already operating in Metro Manila, the reversal adds net new compliant supply to a market with no new PEZA ecozone approvals since the post-pandemic BPO expansion began.
PEZA Director General Panga stated the DTI endorsement would clear pending applications and expand options for IT-BPM locators constrained by the seven-year NCR ecozone freeze.
For international BPO operators and GCC builders evaluating Metro Manila, the PEZA ecozone reopening means premium CBD buildings — Arca South, Makati, Bridgetowne — enter the incentive-eligible supply pool for the first time since 2019. The reversal resolves a supply constraint the Philippine IT-BPM sector has operated against throughout its post-pandemic expansion.
