LOCAL CONSUMERS PREFER 'BRICK AND MORTAR' GROCERY EXPERIENCE  

SEPT 3 --Local consumers prefer the traditional “brick and mortar” experience when it comes to shopping for grocery items, despite the growing trend of online shopping, research firm Nielsen revealed. According to the latest Nielsen Shopper Trends Report, 93 percent of Filipinos prefer to conduct grocery shopping “in-store.” At the same time, eight in 10 prefer to take their time and browse all parts of the store when they shop. “The love for shopping is alive among Filipinos. They find joy in going up and down the aisles to check out grocery items,” said Nielsen Philippines’ shopping insight unit head Lou-Ann Navalta. “Retailers can further intensify the in-store shopping experience by offering a pleasant store environment.

When shoppers are at ease, they are likely to come back to the store. This also makes them more receptive to in-store marketing efforts like promotions or impulse purchases.” Shopper Trends is a syndicated annual report that Nielsen conducts across 54 markets globally. It provides an overview of retail environment trends and an understanding of shopping behavior across the different trade channels. Specifically, it provides insights on where, when and how often people shop, and their emotional commitment and perceptions about key modern trade retailers. In contrast to grocery products, Filipino shoppers are avid users of online retail channels when it comes to purchasing non-consumable items, the survey found. *READ MORE...

ALSO: Presidential insertion in 2015 budget found  

SEPT 5 --PRESIDENT Benigno Aquino III has inserted special provisions in the 2015 national budget that erodes the fiscal autonomy of the judiciary and usurps Congress’ power of the purse, an opposition lawmaker charged Thursday. The presidential insertions were discovered at a briefing for the Commission on Election’s proposed 2015 budget in the House committee on appropriations. ACT Teachers Rep. Antonio Tinio pointed out that the special provision requires the Comelec to report quarterly to the President on how it uses its P144.53 million budget for unfilled positions. Tinio noted that a similarly-worded special provision was inserted under the budgets of co-equal branches of the Executive—the Judiciary and Congress, and of constitutional bodies such as the Commission on Audit, the Ombudsman, the Civil Service Commission, and the Commission on Human Rights.

But no such special provision was indicated under the Office of the President, Tinio said. Previous budget laws carried no such insertions, he added. “The President requires these agencies, which are otherwise fiscally independent, to report to him how they spend these funds,” Tinio said. “But to whom does the President report as to how he spends his department’s own funds? His proposed budget does not contain a similar reporting requirement for the Miscellaneous Personnel Benefits Fund or MPBF, a P118 billion lump sum under the control of the Department of Budget and Management.” Tinio said the MPBF, a special purpose fund “considered as appropriations under the Executive branch” pursuant to the budget proposal, is meant for the unfilled positions, among others, of all executive agencies. *READ MORE...

ALSO: Traffic horror on NLEX   

SEPT 6 --Photo from ABS-CBN’s Sky Patrol shows vehicles stuck in a monster traffic jam on the North Luzon Expressway yesterday. MANILA, Philippines - It looked more like a giant parking lot than an expressway as thousands of commuters and motorists were trapped since early yesterday in monster traffic jams on the North Luzon Expressway (NLEX) from Meycauayan in Bulacan to Balintawak in Caloocan City. The gridlock started as early as 6 a.m., causing many students and workers from the Bulacan area to be late for school or work. Some just decided to return home. NLEX, confronted with a barrage of complaints on its Twitter account NLEX Traffic, initially blamed the “one truck lane policy at Manila area.”  “The policy is everyday,” it added.

At around 5 p.m., however, NLEX Traffic posted, “Please disregard earlier tweet regarding MMDA implementing one truck lane policy.”  Crisey Magpayo, a commuter from Bulacan, told The STAR that the bus she was riding, which was in the area of Valenzuela at around 6:30 a.m., managed to get past the gridlock after four hours. But it was brisk business for ambulant vendors selling candies, crackers, cigarettes, water and other bottled drinks on the expressway. In a statement, Marlene Ochoa, vice president for corporate communications of the Manila North Tollways Corp., apologized for the heavy traffic. “To help ease the situation, we are deploying more traffic patrol teams in coordination with MMDA to direct traffic in Edsa Balintawak Cloverleaf, Mindanao Avenue Link and Balintawak-Bonifacio Road. The traffic patrols will guide trucks to the inner lanes dedicated to them while also guiding cars and other vehicles to the free lanes,” she said. “Our Bocaue toll plaza tellers have also been instructed to provide traffic updates to motorists. This is in addition to the updates on @Nlex Trafficon Twitter and Nligtas app,” she added. Metropolitan Manila Development Authority Chairman Francis Tolentino admitted that the heavy traffic was caused by the “one truck lane policy” and by trucks queuing on a narrow portion of the C-3 Road going to NLEX.

There is no relief in sight as motorists were warned to brace for heavy traffic in the coming days as the MMDA and local government units will implement two weeks of 24-hour “last mile truck routes” to decongest the Port of Manila of shipping containers. The Cabinet Cluster for Port Congestion on Tuesday approved the implementation of the last mile truck routes from Sept. 8 to 22. *READ MORE...

ALSO: PAL buyout a ‘done deal’  

Filipino-Chinese taipan Lucio Tan has reportedly concluded an agreement to buy back the 49 percent of the Philippine Airlines (PAL) he earlier sold to San Miguel Corp. (SMC). Tan, who has kept his 51 percent majority stake in PAL, will reacquire full control of the country’s flag carrier from incumbent PAL president Ramon Ang, who is concurrently the president and chief operating officer of SMC. Both Tan and Ang, however, declined to discuss the reported buyback. “Not yet,” said Ang in a text message to The STAR when asked if the buyback was a done deal. The reported return of PAL to the full control of Tan was the hot topic among local and foreign travel industry leaders attending the SKAL reception Friday night at the New World Hotel. “There will be a formal announcement probably next week once finalized,” former PAL president Jaime Bautista, who was present at the SKAL reception, said without elaborating. Tan recently named Bautista to represent him in the PAL board. Talks have been going with Ang on a move by the Lucio Tan Group to buy back SMC’s 49 percent stake in PAL.

In April 2012, SMC’s wholly owned subsidiary San Miguel Equity Investments Inc. (SMEII) acquired a 49-percent equity interest in Trustmark Holdings Corp. for $500 million. Trustmark owns 97.71 percent of PAL Holdings, which in turn owns 84.67 percent of PAL through PR Holdings Inc. Ang has been steering PAL for the past three years. Highlighting his management was PAL’s acquisition of a new fleet of Airbus aircraft as well as the opening of new routes. After reacquiring full control of PAL possibly within the month, Tan’s group is likely to take in Abu Dhabi-based Etihad Airways as partner, reportedly with a 40 percent stake. As of end-June, PAL has received a total of 17 aircraft from Airbus, including 10 A330 and seven A321. The fleet of the PAL Group including PAL Express comprised 85 aircraft as of end-June. PAL is set to retire 20 aging aircraft, including four Boeing 747-400s, as part of efforts to transform the company into “Asia’s airline of choice” and one of Asia’s youngest fleet, at 3.5 years.

ALSO: Here’s why garlic prices are skyrocketing  

SEPT 3 --The Department of Justice (DOJ) on Wednesday said that the team created by the Department of Agriculture to ensure the stability of garlic supply is “unnecessary, unhelpful” and even contributed to the problem of high prices of garlic. Based on the recommendation report submitted to Justice Secretary Leila De Lima by the Office of the Competition, the National Garlic Action Team (NGAT) should be abolished because instead of helping control the spike of garlic prices, it contributed to the problem by allowing monopoly to a preferred group. “We are recommending its abolition and the establishment of a fair and transparent system that will allow competition in the garlic industry consistent with the dictates of justice,” De Lima said. NGAT was created in 2012. It is a multi-stakeholder body tasked to ostensibly ensure the stability of garlic supply in the country. Among its members are eight farmer cooperatives. Investigation by the office showed that the eight farmer cooperatives benefitted in the allocation of permits by the Bureau of Plant Industry for garlic importation. These farmer cooperatives, De Lima said is being controlled by a certain Lilia M. Cruz or Leah Cruz who also pushed for the creation of the National Onion Action Team (NOAT). De Lima said, Cruz is in control of the bulk of garlic importation in the country. *READ MORE...

ALSO Inquirer Editorial: GDP --Not worth the brag 

SEPT 2 --Two economic stories highlighted the past week—one, the stellar growth of the country’s gross domestic product or GDP; the other, the 50 Filipino families and individuals in the Forbes list of the world’s wealthiest for 2014. The Aquino administration delighted in announcing that the economy expanded by 6.4 percent in the second quarter of 2014, faster than what many private economists had expected. The expansion was driven by industry (which grew by 7.8 percent), services (6 percent), and agriculture (3.6 percent) even as government spending declined. All subsectors of services, which constitute the biggest sector of the economy and account for 57 percent of GDP, posted solid growth, particularly real estate; trade and repair service; transportation, storage and communication; and banking. All industry subsectors, led by manufacturing, utilities, mining and quarrying and construction, also contributed to the robust economic growth.

In the private sector, the 50 wealthiest individuals and families in the Philippines—led for the seventh year in a row by retail tycoon Henry Sy of the SM group—saw their fortunes rise double the speed of domestic economic growth. Their combined net worth expanded by 12 percent—to $74 billion; that is P3.23 trillion in Philippine currency or 28 percent of the country’s GDP. Aside from Sy, who was estimated to have increased his net worth by $700 million to $12.7 billion in just a year, the others “riding high on the country’s prosperity” include taipan Lucio Tan ($6.1 billion), port and casino tycoon Enrique Razon Jr. ($5.2 billion), former senator Manuel Villar ($1.46 billion, up $410 million from a year ago), and David Consunji, founder of DMCI Holdings (he added more than $1 billion to his net worth, bringing it to $3.9 billion). To be sure, the vigorous economic growth is making the rich richer. Unfortunately, it has not been inclusive, it has not generated enough new jobs, and it has hardly, if at all, improved the sorry structure of the Philippine economy. Latest estimates still place the poverty incidence at 25 percent. *COONTINUE READING...


READ FULL MEDIA REPORTS:

Local consumers prefer ‘brick and mortar’ grocery experience

MANILA, SEPTEMBER 8, 2014 (INQUIRER) POSTED SEPT 3 --By Daxim L. Lucas- Local consumers prefer the traditional “brick and mortar” experience when it comes to shopping for grocery items, despite the growing trend of online shopping, research firm Nielsen revealed.

According to the latest Nielsen Shopper Trends Report, 93 percent of Filipinos prefer to conduct grocery shopping “in-store.” At the same time, eight in 10 prefer to take their time and browse all parts of the store when they shop.

“The love for shopping is alive among Filipinos. They find joy in going up and down the aisles to check out grocery items,” said Nielsen Philippines’ shopping insight unit head Lou-Ann Navalta. “Retailers can further intensify the in-store shopping experience by offering a pleasant store environment. When shoppers are at ease, they are likely to come back to the store. This also makes them more receptive to in-store marketing efforts like promotions or impulse purchases.”

Shopper Trends is a syndicated annual report that Nielsen conducts across 54 markets globally. It provides an overview of retail environment trends and an understanding of shopping behavior across the different trade channels. Specifically, it provides insights on where, when and how often people shop, and their emotional commitment and perceptions about key modern trade retailers.

In contrast to grocery products, Filipino shoppers are avid users of online retail channels when it comes to purchasing non-consumable items, the survey found.

* According to the latest Nielsen Global Survey of E-Commerce, Filipinos are increasingly going online to purchase travel services and tickets for events such as movies, live performances, exhibitions and sports games.

Fifty-five percent of Filipinos who go online intend to buy airline tickets or make reservations online within the next six months. Forty-six percent plan to make hotel reservations and 37 percent intend to purchase event tickets online.

Globally, Singaporeans have the highest online purchasing intention for airline tickets and hotel and tour reservations, and second highest globally for event tickets.

Digital consumers in the Philippines are among the most-inclined to purchase items online, along with Vietnamese and Singaporeans.

Indonesians, Malaysians and Thais, meanwhile, are more likely to go online to browse. Reading online reviews, product research and checking out products to inform their offline purchases rank among the main factors motivating Filipinos to go online to shop.

Credit card security remains a key concern across the region with five of the six Southeast Asia markets ranking above the global average with respect to their concern around providing credit card information online.

FROM THE MANILA STANDARD

Presidential insertion in 2015 budget found By Christine F. Herrera | Sep. 05, 2014 at 12:01am


Aquino

PRESIDENT Benigno Aquino III has inserted special provisions in the 2015 national budget that erodes the fiscal autonomy of the judiciary and usurps Congress’ power of the purse, an opposition lawmaker charged Thursday.

The presidential insertions were discovered at a briefing for the Commission on Election’s proposed 2015 budget in the House committee on appropriations.

ACT Teachers Rep. Antonio Tinio pointed out that the special provision requires the Comelec to report quarterly to the President on how it uses its P144.53 million budget for unfilled positions.

Tinio noted that a similarly-worded special provision was inserted under the budgets of co-equal branches of the Executive—the Judiciary and Congress, and of constitutional bodies such as the Commission on Audit, the Ombudsman, the Civil Service Commission, and the Commission on Human Rights.

But no such special provision was indicated under the Office of the President, Tinio said.

Previous budget laws carried no such insertions, he added.

“The President requires these agencies, which are otherwise fiscally independent, to report to him how they spend these funds,” Tinio said.

“But to whom does the President report as to how he spends his department’s own funds? His proposed budget does not contain a similar reporting requirement for the Miscellaneous Personnel Benefits Fund or MPBF, a P118 billion lump sum under the control of the Department of Budget and Management.”

Tinio said the MPBF, a special purpose fund “considered as appropriations under the Executive branch” pursuant to the budget proposal, is meant for the unfilled positions, among others, of all executive agencies.

* Tinio questioned the new encroachment by the Aquino administration on the fiscal independence of co-equal branches.

Under the proposed budget of the Supreme Court, Tinio cited Special Provision No. 6, which states: “Funding Requirements for the Filling of Unfilled Positions. The Supreme Court shall submit, either in printed form or by way of electronic document, to the Office of the President quarterly reports on the utilization of said amounts.”

“The total funds covered by these provisions amount to P7.2 billion,” Tinio said.

Tinio demanded the deletion of these provisions.

He recalled that Aquino also proposed this reporting requirement for the 2014 budget but Congress removed it from the enacted law, “giving more reason for Congress to delete these provisions in the 2015 budget.”

Tinio said the allocation for the unfilled positions of the Supreme Court and the lower courts amount to P2.85 billion while some P42.6 million was allotted to Presidential Electoral Tribunal.

The Sandiganbayan has an appropriation of P20.22 million; the Court of Appeals, P98.52 million; and the Court of Tax Appeals, P36.87 million.

The Senate has P109.86 million for unfilled positions. The Senate Electoral Tribunal has P25.59 million and the Commission on Appointments has P40.401 million.

The House of Representatives has an allocation of P116.08 million while the House of Representatives Electoral Tribunal has P35.42 million.

The Office of the Ombudsman has an allocation of P733.63 million; COA, P2.87 billion; and the Civil Service Commission, P95.302 million.

Tinio described the Palace insertions as “fiscal dictatorship.”

FROM PHILSTAR

Traffic horror on NLEX By Cecille Suerte Felipe and Mike Frialde (The Philippine Star) | Updated September 6, 2014 - 12:00am 53 441 googleplus0 3


Photo from ABS-CBN’s Sky Patrol shows vehicles stuck in a monster traffic jam on the North Luzon Expressway yesterday.

MANILA, Philippines - It looked more like a giant parking lot than an expressway as thousands of commuters and motorists were trapped since early yesterday in monster traffic jams on the North Luzon Expressway (NLEX) from Meycauayan in Bulacan to Balintawak in Caloocan City.

The gridlock started as early as 6 a.m., causing many students and workers from the Bulacan area to be late for school or work. Some just decided to return home.

NLEX, confronted with a barrage of complaints on its Twitter account NLEX Traffic, initially blamed the “one truck lane policy at Manila area.”

“The policy is everyday,” it added.

At around 5 p.m., however, NLEX Traffic posted, “Please disregard earlier tweet regarding MMDA implementing one truck lane policy.”

Crisey Magpayo, a commuter from Bulacan, told The STAR that the bus she was riding, which was in the area of Valenzuela at around 6:30 a.m., managed to get past the gridlock after four hours.

But it was brisk business for ambulant vendors selling candies, crackers, cigarettes, water and other bottled drinks on the expressway.

In a statement, Marlene Ochoa, vice president for corporate communications of the Manila North Tollways Corp., apologized for the heavy traffic.

“To help ease the situation, we are deploying more traffic patrol teams in coordination with MMDA to direct traffic in Edsa Balintawak Cloverleaf, Mindanao Avenue Link and Balintawak-Bonifacio Road. The traffic patrols will guide trucks to the inner lanes dedicated to them while also guiding cars and other vehicles to the free lanes,” she said.

“Our Bocaue toll plaza tellers have also been instructed to provide traffic updates to motorists. This is in addition to the updates on @Nlex Trafficon Twitter and Nligtas app,” she added.

Metropolitan Manila Development Authority Chairman Francis Tolentino admitted that the heavy traffic was caused by the “one truck lane policy” and by trucks queuing on a narrow portion of the C-3 Road going to NLEX.

There is no relief in sight as motorists were warned to brace for heavy traffic in the coming days as the MMDA and local government units will implement two weeks of 24-hour “last mile truck routes” to decongest the Port of Manila of shipping containers.

The Cabinet Cluster for Port Congestion on Tuesday approved the implementation of the last mile truck routes from Sept. 8 to 22.

* Tolentino told reporters yesterday that his agency would be issuing stickers for free that would be attached to trucks using the last mile routes.

The stickers are technically passes, allowing trucks to transport shipping containers even during the truck ban hours for two weeks, except along specific roads where the truck ban hours will be strictly observed.

Trucks availing of the last mile truck routes will also have their rear bumpers painted with the identifying sign “LASMAYL.”

Tolentino said trucks with stickers would be allowed to go through the roads of Metro Manila from the Port of Manila to their respective warehouses for 24 hours except on EDSA, España Boulevard in Manila (from Quezon Boulevard to Welcome Rotonda), Ortigas Avenue (from Santolan to Sta. Lucia), Katipunan (from Santolan to Commonwealth Avenue), Recto (from A. Santos to Legarda) and Taft Avenue where the truck ban hours of 6 a.m. to 10 a.m. and from 5 p.m. to 10 p.m. are still in effect.

Trucks with stickers can use other Metro Manila roads even during the truck ban hours, but trucks without stickers will have to observe the truck ban hours in all roads, the MMDA said.

Trucks with stickers will, however, not be allowed to park in any Metro Manila road or street.

The MMDA said a truck with sticker that would be caught parking on any Metro Manila road or street or would be caught on EDSA, España, Ortigas, Katipunan, Recto and Taft Avenue during the truck ban hours would be apprehended and the owners fined P5,000.

The MMDA would also recommend the blacklisting of the trucking company.

Tolentino clarified that only cargo trucks which would pull out shipping containers from the Port of Manila on a Sunday or Monday morning up to noon would be allowed to use the last mile truck routes for one week, from Sept. 8 to 15.

Another sticker will be issued for trucks intending to use the last mile truck routes from Sept. 15 to 22. – With Aurea Calica

PAL buyout a ‘done deal’ By Marichu Villanueva (The Philippine Star) | Updated September 7, 2014 - 12:00am 60 3260 googleplus1 0

MANILA, Philippines - Filipino-Chinese taipan Lucio Tan has reportedly concluded an agreement to buy back the 49 percent of the Philippine Airlines (PAL) he earlier sold to San Miguel Corp. (SMC).

Tan, who has kept his 51 percent majority stake in PAL, will reacquire full control of the country’s flag carrier from incumbent PAL president Ramon Ang, who is concurrently the president and chief operating officer of SMC.

Both Tan and Ang, however, declined to discuss the reported buyback. “Not yet,” said Ang in a text message to The STAR when asked if the buyback was a done deal.

The reported return of PAL to the full control of Tan was the hot topic among local and foreign travel industry leaders attending the SKAL reception Friday night at the New World Hotel.

“There will be a formal announcement probably next week once finalized,” former PAL president Jaime Bautista, who was present at the SKAL reception, said without elaborating.

Tan recently named Bautista to represent him in the PAL board.

Headlines ( Article MRec ), pagematch: 1, sectionmatch: 1

Talks have been going with Ang on a move by the Lucio Tan Group to buy back SMC’s 49 percent stake in PAL.

In April 2012, SMC’s wholly owned subsidiary San Miguel Equity Investments Inc. (SMEII) acquired a 49-percent equity interest in Trustmark Holdings Corp. for $500 million.

Trustmark owns 97.71 percent of PAL Holdings, which in turn owns 84.67 percent of PAL through PR Holdings Inc.

Ang has been steering PAL for the past three years. Highlighting his management was PAL’s acquisition of a new fleet of Airbus aircraft as well as the opening of new routes.

After reacquiring full control of PAL possibly within the month, Tan’s group is likely to take in Abu Dhabi-based Etihad Airways as partner, reportedly with a 40 percent stake.

As of end-June, PAL has received a total of 17 aircraft from Airbus, including 10 A330 and seven A321.

The fleet of the PAL Group including PAL Express comprised 85 aircraft as of end-June.

PAL is set to retire 20 aging aircraft, including four Boeing 747-400s, as part of efforts to transform the company into “Asia’s airline of choice” and one of Asia’s youngest fleet, at 3.5 years.

* PAL is back in the black after booking a net income of P1.49 billion in the second quarter of the year from a net loss of P1.08 billion in the same quarter last year.

Ang is still hopeful that the buyout talks would be completed within the third quarter of the year. The prolonged buyout talks have affected the operations of the national flag carrier, with its planned return to New York postponed to the first quarter of next year. The airline plans to fly to JFK International airport in New York via Vancouver at least four times a week starting March 15. The original schedule was for October this year, after the US Federal Aviation Administration upgraded the aviation safety rating of the Philippines back to Category 1 from Category 2.

It is also set to launch more direct flights to Europe including Paris, Rome, Amsterdam, among others after successfully mounting direct flights to London last November after the airline was allowed by the European Union to enter European airspace. With Lawrence Agcaoili

FROM THE INQUIRER

Here’s why garlic prices are skyrocketing By Tetch Torres-Tupas |INQUIRER.net4:39 pm | Wednesday, September 3rd, 2014


FILE PHOTO

MANILA, Philippines—The Department of Justice (DOJ) on Wednesday said that the team created by the Department of Agriculture to ensure the stability of garlic supply is “unnecessary, unhelpful” and even contributed to the problem of high prices of garlic.

Based on the recommendation report submitted to Justice Secretary Leila De Lima by the Office of the Competition, the National Garlic Action Team (NGAT) should be abolished because instead of helping control the spike of garlic prices, it contributed to the problem by allowing monopoly to a preferred group.

“We are recommending its abolition and the establishment of a fair and transparent system that will allow competition in the garlic industry consistent with the dictates of justice,” De Lima said.

NGAT was created in 2012. It is a multi-stakeholder body tasked to ostensibly ensure the stability of garlic supply in the country. Among its members are eight farmer cooperatives.

Investigation by the office showed that the eight farmer cooperatives benefitted in the allocation of permits by the Bureau of Plant Industry for garlic importation. These farmer cooperatives, De Lima said is being controlled by a certain Lilia M. Cruz or Leah Cruz who also pushed for the creation of the National Onion Action Team (NOAT).

De Lima said, Cruz is in control of the bulk of garlic importation in the country.

* De Lima said the National Bureau of Investigation (NBI) is already conducting further investigation against Cruz as well as possibility that some officials from the Bureau of Plant Industry are conspiring with NGAT and with the farmers’ cooperatives.

Investigation by the Office of the Competition also showed that there was actually no shortage of supply of garlic. In fact, the group said there were more than adequate stocks of garlic.

The recommendation will be given to President Benigno Aquino III.

An investigation was conducted following the big spikes of prices of garlic reaching as high as P287 per kilo in June 2014, which is 74 percent increase within a one-year period and more than 100 percent increase from average prices.

She said the NBI is determining who should be slapped with a case.

INQUIRER EDITORIAL

GDP: Not worth the brag Philippine Daily Inquirer12:13 am | Tuesday, September 2nd,

 
EDITORIAL CARTOON COURTESY OF PHILSTAR: Beating the odds, the Philippine economy grew by a robust 6.4 percent in the first quarter of the year primarily on increased government spending. Malacañang rejoiced and said the expansion was the highest in Southeast Asia and the second highest in Asia.

Two economic stories highlighted the past week—one, the stellar growth of the country’s gross domestic product or GDP; the other, the 50 Filipino families and individuals in the Forbes list of the world’s wealthiest for 2014.

The Aquino administration delighted in announcing that the economy expanded by 6.4 percent in the second quarter of 2014, faster than what many private economists had expected.

The expansion was driven by industry (which grew by 7.8 percent), services (6 percent), and agriculture (3.6 percent) even as government spending declined.

All subsectors of services, which constitute the biggest sector of the economy and account for 57 percent of GDP, posted solid growth, particularly real estate; trade and repair service; transportation, storage and communication; and banking. All industry subsectors, led by manufacturing, utilities, mining and quarrying and construction, also contributed to the robust economic growth.

In the private sector, the 50 wealthiest individuals and families in the Philippines—led for the seventh year in a row by retail tycoon Henry Sy of the SM group—saw their fortunes rise double the speed of domestic economic growth.

Their combined net worth expanded by 12 percent—to $74 billion; that is P3.23 trillion in Philippine currency or 28 percent of the country’s GDP. Aside from Sy, who was estimated to have increased his net worth by $700 million to $12.7 billion in just a year, the others “riding high on the country’s prosperity” include taipan Lucio Tan ($6.1 billion), port and casino tycoon Enrique Razon Jr. ($5.2 billion), former senator Manuel Villar ($1.46 billion, up $410 million from a year ago), and David Consunji, founder of DMCI Holdings (he added more than $1 billion to his net worth, bringing it to $3.9 billion).

To be sure, the vigorous economic growth is making the rich richer. Unfortunately, it has not been inclusive, it has not generated enough new jobs, and it has hardly, if at all, improved the sorry structure of the Philippine economy. Latest estimates still place the poverty incidence at 25 percent.

* Even to the burgeoning middle class, the two events hardly matter with the prices of basic goods and services rising fast and interest rates beginning to head north, portending of higher amortization on housing loans.

Consumer prices jumped 4.9 percent in July from a year ago, the fastest pace since October 2011. Inflation more than doubled in less than a year, and this many have blamed on Supertyphoon “Yolanda” (which devastated the Visayas in November last year) and on the continued truck ban in the City of Manila that had reportedly increased the cost of transporting goods.

The Bangko Sentral ng Pilipinas, on the other hand, raised its benchmark interest rate to 3.75 percent in July from a record low. Earlier, it increased the rate on special deposit accounts (the money parked by banks at BSP vaults) and raised twice the reserve requirement ratio (the percentage of deposits that banks cannot lend out). These moves are meant to lessen the supply of money to contain inflation. This, however, will also result in higher interest rates for housing, car and other consumer loans.

Then again, working people continue to contend with the monstrous traffic around Metro Manila, with the overloaded and unstable Metro railway system not providing any relief to the congestion. They also have to worry about the higher crime rate and a seemingly worsening local peace and order situation. And there is the looming shortage in power supply (read: frequent brownouts) this summer of 2015.

In the face of all this, legislators are busy debating whether or not to extend the term of President Aquino, while others in government are preoccupied with getting publicity via the globally trending fund-raising “ice bucket challenge.”

With one in every four Filipinos living in poverty and the working class struggling to cope with the ever-increasing cost of living, the administration’s brag about having so many billionaires in the Forbes list or having Asia’s fastest-growing economy sounds nothing more than vapid talk to most Filipinos.

We’re not saying it should get all the blame for this flawed economic structure. The private sector has to do its part in making the fruits of economic growth trickle down to those who need them most.

With the rise in the wealthiest’s fortunes outpacing the country’s economic growth rate, increasing the wages of their rank-and-file employees would be a good starting point.

Perhaps a simple check would surprise them to see that many of their lowest-paid employees are part of the 25 percent of the poor population.


Chief News Editor: Sol Jose Vanzi

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