SUBIC BAY FREEPORT - Philip Morris Philippines Manufacturing Inc. (PMPMI) is set to expand the capacity of its tobacco facility here by 4 times, a move seen to strengthen the freeport's goal to become the leading logistics hub in Southeast Asia.

In a statement released by the Subic Bay Metropolitan Authority (SBMA) on Monday, PMPMI Managing Director Christorpher Nelson said the warehouse will be able to hold some 24,000 metric tons of tobacco. At present, the company's Subic facility can only accommodate 6,100 metric tons.

Nelson said the new warehouse will boast of features like humidity control, fire suppression equipment, and air conditioning to handle the imported tobacco leaves from foreign suppliers, which will then be shipped and processed in cigarette manufacturing plants in the Philippines, Malaysia, and Indonesia.

PMPMI signed a 50-year lease agreement with SBMA last week, increasing the size of its warehouse there to 49,279 square meters from the current 9,600 square meters. The expansion is part of the company's plan to construct a P1-billion tobacco leaf regional warehouse in the Subic freeport.

"[The warehouse expansion is] a reflection of our faith in the Philippine government, particularly the SBMA," Nelson said. He expressed confidence that PMPMI will sustain profitability despite the increasing competition in the tobacco industry.

For his part, SBMA Administrator Armand Arreza said the freeport's multi-modal transport capabilities, world-class infrastructure, modern road networks, and tax incentives might have prompted PMPMI to sign the 50-year lease agreement.

"A global brand such as Phillip Morris would not make hasty decisions, which means the firm has really found Subic an enviable logistics hub," he said.