Data centers: Emerging economic pillar

The Philippines in 2023 recorded significant gains in foreign direct investments, strengthening its appeal to global investors as the country welcomed 2024 on the back of widespread strong positive economic sentiment.

Last year, foreign investments reached PHP173 billion which is 23 percent higher than the PHP140 billion recorded in 2022, according to Philippine Economic Zone Authority (PEZA) Director General Tereso Panga. The substantial role foreign investments played is further highlighted as it recorded a nearly six-fold increase or 567 percent to PHP757.33 billion from the previous year’s PHP113.49 billion in the first 10 months of 2023 alone, data from the Board of Investments showed.

The achievement, according to Panga, stands out "despite encountering headwinds and economic challenges" that the country had to navigate.

Central to this substantial development is the growing data center industry that emerged as a key factor for the country’s economic revival.

In discussions during a forum organized by the European Chamber of Commerce of the Philippines, the country’s growing appeal to foreign investors was highlighted given its deep bench of information technology talents, investment-friendly policies, and the opportunities to leverage renewable energy in data center operations.

Data centers have evolved into a keystone for businesses in adapting to the new normal as these facilitate the important shift to digitalization following the pandemic disruption. The growing hyperscale deployment is reshaping the data center landscape—highlighting the growing demand for considerable space and power resources.

Here in the Philippines, hyperscale data centers which are exemplified by VITRO—the flagship data center network in the country which is owned and operated by the PLDT Group's ICT arm ePLDT— play a key role in the development of a resilient digital ecosystem. These centers facilitate collaboration among key players in digitalization—power providers, telecommunication firms, cloud service companies, and enterprises.

With digitalization seen as the way forward for nearly all businesses—the data center emerges as a convergence point where stakeholders can efficiently and effectively collaborate to define development. In today’s highly digital business landscape, the value of a data center cannot be overemphasized as it serves as a strategic facilitator of the development of the overall infrastructure that serves as the bedrock of the country’s digital ambitions.

This early, ePLDT is already working on the Philippines’ case as the next hyperscale hub in the Asia-Pacific region with the forthcoming launch of VITRO Santo Rosa—the country’s first true hyperscale data center.

More promising is the 100MW hyperscale facility in the pipeline which ePLDT is working on to help the country grow its market share in fulfilling the information and communication technology (ICT) needs of international customers as it continues to support the digital transformation journey of local industries.

These developments come at an opportune time given the ongoing digital transformation wave that is expected to accelerate across various industries globally. With global connectivity providers seeking alternative transit hubs—the Philippines emerges as a key choice given ongoing geopolitical concerns.

Moving forward, strengthening and expanding the Philippines’ capacity in the digital arena not only makes the country a competitive player but also cements its identity as an economic driver in the region.

Editor’s note: The opinions expressed in the foregoing article are solely the author’s and do not reflect the opinions and beliefs of the Philippine News Agency (PNA) or any other office under the Presidential Communications Office.