By IRMA ISIP

SUBIC BAY - Philip Morris International is investing P1.03 billion for a regional tobacco leaf warehousing facility in Boton.

The warehouse is four times bigger than the current one it is operating.

The new investment is part of the company’s expansion plans in the Philippines. The cigarette company chose Subic over Singapore.

Chris Nelson, managing director of PMI affiliate Philip Morris Manufacturing Philippines Inc. (PMPMI) said the company’s plan to hike exports from its Batangas plant is hampered by Thailand’s plan to increase tax on its exports.

Thailand is a primary market.

Nelson said the warehouse will store tobacco leaves bought from the Philippines, Indonesia, India, China and Thailand.

Building 8110 in Subic has total area of 10,000 square meters with total capacity of 6,100 metric tons of leaves.

The building is expected to hit full capacity by March this year. The new warehouse will be operational by 2009.

But Nelson said PMPMI’s exports of cigarettes to Thailand is potentially harmed by a recent tariff hike contested by the firm that could result in higher taxes and retail prices of the commodity there. Nelson said the Philippines has elevated the matter at the Asean as well as the World Trade Organization’s dispute settlements to intercede in behalf of PMPMI.