Philippines Introduces Incentives for Tech Start-Ups in Universities to Boost Robotics, Big Data, and AI
The Department of Science and Technology (DOST) and the Philippine Economic Zone Authority (Peza) have joined forces to establish special economic zones (SEZs) within universities and colleges in the Philippines. Aimed at fostering research and technological development in cutting-edge fields such as robotics, big data, and artificial intelligence (AI), these zones, known as knowledge, innovation, science, and technology (KIST) parks, are set to incentivize tech start-ups in higher education institutions (HEIs).
The newly formed partnership between DOST and Peza aims to address the lack of research and development (R&D) driven innovations in the country. By creating KIST parks, the government hopes to generate more job opportunities and commercialize homegrown innovations, according to Sancho Maborang, Undersecretary for Regional Operations at the Science and Technology department.
To encourage the growth of tech start-ups, KIST parks will enjoy various perks, including income-tax holidays, a preferential 5% tax rate on gross income, zero value-added tax (VAT) rating, as well as tax and duty-free importation of capital equipment, raw materials, and supplies. By utilizing these benefits, start-ups can collaborate with the faculty and students of the partnered universities or leverage the facilities within the KIST ecozones to develop their products.
Currently, one KIST park has already been declared at Batangas State University (BatStateU). Positioned to lead green industrial townships and smart city networks in southern Tagalog, BatStateU’s KIST park will house vital facilities such as a technology hub, a design innovation building, and a data center. Notably, the Science, Technology, Engineering, and Environment Research (STEER) Hub at BatStateU will accommodate the university’s Center for Technopreneurship and Innovation, manufacturing research center Likha FabLab, and offer spaces for lease to tech entrepreneurs.
Aside from Batangas State University, three other universities are awaiting declaration as KIST parks by President Marcos. These include De La Salle’s Innovation Hub in Laguna, University of Perpetual Help’s AltaHub in Cavite, and Lyceum of the Philippines’ KIST Park in Laguna.
To be eligible for a KIST park, higher education institutions within metropolitan areas should have a contiguous land area of 5,000 square meters. For institutions located outside the metro, the minimum requirement is a land area of at least 10,000 square meters. The Department of Science and Technology will endorse proposed KIST parks that focus on priority areas outlined in their joint memorandum circular (JMC), including biotechnology, food and nutrition, agriculture, engineering, electronics, renewable energy, and transport solutions.
By establishing KIST parks, the Philippine government hopes to inspire more students to pursue careers in science and R&D. The economic benefits, job creation, and productivity associated with these fields are expected to drive interest among aspiring researchers and innovators. With the support of DOST and Peza, the country aims to position itself as a hub for robotics, big data, and AI innovation, contributing to its economic growth and technological advancement.
