Food & Beverage

Unilever to invest $120M to upgrade Philippine manufacturing facilities

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UNILEVER Philippines is investing $120 million for the upgrade and expansion of its Philippine manufacturing operations, which may take place over six years.

The consumer goods firm will bring in pioneering technology in specific areas of its manufacturing operations as part of its expansion plan, according to documents, and may be seeking incentives from the Board of Investments (BOI) as an “Inclusive Business” enterprise.

About $90 million of the $120-million investment will go to the purchase of new equipment, which will be rolled out until 2020. The remaining amount may be used to upgrade existing technology, and in the expansion and increase of Unilever asset base.

Specifically, the purchase of new equipment and improvement of existing ones will be in the processing, filling and packaging operations of its manufacturing.

By 2020, Unilever Philippines will have 58 new end-of-line packaging units, 60 new filling lines, and would have purchased 11 processing lines, on top of the modernization of existing equipment.

Documents show that the expansion plan is expected to increase production capacity to 100,000 tons but will be carried out incrementally.

Unilever Philippines operates a plant in Pandacan, Cavite and Manggahan, where it produces laundry and personal-care products under well-known brands. It also processes food items.

Further, the documents detailed the “pioneer technology” it is set to bring in as part of its expansion, specifically in the manufacture of food, personal-care and home-care items.

Under the Omnibus Investments Code of the Philippines, if a project is granted a pioneer status, which is based on the technology a firm will use in its activity, the company can enjoy an incentive package that includes income-tax holiday of up to six years.

Accompanying documents, still from Unilever Philippines, detail its inclusive business-thrust agenda, specifically citing its sourcing of tamarind as a raw material for its Knorr Sinigang Mix and purple yam for Selecta Ube Ice Cream.

“Currently, Unilever Philippines sources its tamarinds from local farmers in Cagayan Valley and Batangas through its local supplier, Sunrich Manufacturing Corp. Sunrich deals directly with the farmers using Unilever standards as a guide to assist farmers in increasing their farming productivity,” the document read, adding that 500 farmers are currently benefiting from the program.

The BOI recently introduced a program that will grant additional nonfiscal incentives to enterprises that adopt the Inclusive Business (IB) model in the pilot areas of agri-business, housing and tourism. Guidelines for accreditation as an IB business are still being crafted by the BOI.

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The SupplyChains Magazine editorial team takes great pride in bringing you the best information to help you succeed in your supply chain, logistics or procurement functions. Together, our editors and contributors have more than 50 years of supply chain industry knowledge to share with you.

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