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KILLINGS, RODY TIRADES MAY DAMPEN INVESTMENTS, says EU BIZ COMMUNITY [RELATED: Duterte approval rating remains high at 83%—Pulse Asia] [RELATED(2): DOF warns of ‘disastrous’ consequences of pension hike]
JANUARY 2 -The European business community has two special wishes for President Rodrigo Duterte this New Year: that he address concerns on alleged extrajudicial killings and end his verbal assaults on the country’s international allies. AP/Aaron Favila, File The European business community has two special wishes for President Duterte this New Year: that he address concerns on alleged extrajudicial killings and end his verbal assaults on the country’s international allies. European business leaders warned that the killings and verbal tirades could dampen investor confidence in the Philippines. “We have seen uncertainty caused by statements done in the first couple of months since the new administration came in. European business has been here a long time and is still here for the long term. European companies are partners and are providing much needed jobs and foreign direct investments, hence helping the government to contribute to the overarching goal of inclusive growth in the country,” said Guenter Taus, European Chamber of Commerce of the Philippines president. READ MORE...RELATED, Duterte approval rating at 83%—Pulse Asia... RELATED(2) DOF warns of ‘disastrous’ consequences of pension hike...
ALSO: Duterte, Trump headlined top business news in 2016
[RELATED YearEnder: Duterte honeymoon is over for the stock market]
[RELATED(2): Low interest rates to remain – DOF]
JANUARY 2 -Duterte looks forward to working with Trump's government | Headlines, News, The Philippine Star | philstar.com The election of Rodrigo Duterte and Donald Trump as presidents defined the business news in the Philippines in 2016, as their simple remarks could move markets and cause jitters among investors. Duterte, the former Davao City mayor who brought his bloody anti-crime campaign to the national scene, shocked the business community when he shifted the country’s economic relations away from the US and towards China. Trump, who will become the 45th US president on Jan. 20, 2017, vowed to bring back jobs to the US by tightening immigration controls and restricting job outsourcing. The Philippines, the world’s call center capital, is edgy. Aside from Duterte and Trump, here are the other top business news in the Philippines last year. READ MORE...RELATED YearEnder: Duterte honeymoon is over for the stock market...RELATED(2) Low interest rates to remain – DOF...
ALSO: Diokno likens redundant tax incentives to pork barrel; Tax perks need to be reviewed
(“I call the incentives pork barrel on the tax side. If you are a congressman or a senator, you would sponsor a bill that would provide incentives to a sector, which would definitely help you once you seek reelection,” Diokno added.)
[RELATED: Lacson - 'Pork' shifts from Liberal Party to Mindanao ARMM solons]
JANUARY 3 -Diokno said tax incentives have resulted in revenue losses equivalent to 1 to 2 percent of the country’s GDP. File Budget Secretary Benjamin Diokno has likened redundant fiscal incentives to “pork barrel” as he cited the need to review tax perks that have led to significant losses of state revenues. Diokno said tax incentives have resulted in revenue losses equivalent to 1 to 2 percent of the country’s gross domestic product (GDP). The GDP is the sum total of the goods and services produced by an economy in a given period. “We will review the tax incentives. There are many businesses that will remain profitable even if they are not given incentives. The incentives are redundant,” Diokno told radio station dzMM in Filipino last Monday. READ MORE...RELATED, Lacson: 'Pork' shifts from LP to Mindanao solons...
ALSO: FEATURE -Filipina cited as ‘Global Visionary’
[RELATED: Tetangco wants stronger powers for AMLC to run after tax dodgers]
JANUARY 2 -Analisa Leonor Balares Growing up poor didn’t stop Analisa Leonor Balares from getting an Ivy League education, working at Wall Street, and sharing similar opportunities with other women and girls through her Womensphere Foundation. She was born into a poor family — her father was a family driver and her mother a househelp — but brains, perseverance and innate leadership skills propelled Analisa Leonor Balares into getting an Ivy League education that eased her way into becoming a rainmaker at Wall Street, a valuable manager who brings in business from wealthy clients. But wanting to work toward a more inclusive and sustainable world by helping empower women and girls made her quit the corporate world in 2008 to put up Womensphere Foundation, a global organization that seeks to accelerate women’s advancement in leadership, innovation and entrepreneurship. READ MORE...ALSO, Tetangco wants stronger powers for AMLC to run after tax dodgers...
ALSO: PAL expansion leads to corporate makeover in 2017
[RELATED: Philippine Airlines launches first international service from Clark, Jan 1]
JANUARY 2 -This 2016, on its 75th anniversary, Philippine Airlines’ (PAL) “Heart of the Filipino” marketing campaign coincided with its new corporate vision to be a five-star airline within five years, according to Jonathan P. Gesmundo, PAL Editorial Consultant. PAL aims to be ranked five-star by Skytrax, a global airline rating organization, and rejoin the league of the world’s best airlines. No wonder, “Get That Star” has become the mantra of PAL employees, he noted. New PAL plane Airbus A350-900 New PAL plane Airbus A350-900 It also helped that the Centre for Asia-Pacific Aviation (CAPA) named PAL as the “Airline Turnaround for the Year 2016”, posting a six-fold increase in its income to $134.42 million over the previous year. READ MORE...RELATED, Philippine Airlines launches first international service from Clark...
ALSO: PH set to sustain growth this year
[RELATED: BOI-approved investments up 20% at P441B in 2016]
JANUARY 2 -Finance Secretary Carlos Dominguez III The Finance Department said it expects the Philippine economy to sustain its high growth this year, despite the “political noise” in the first six months of the Duterte administration. Finance Secretary Carlos Dominguez III said he remained bullish about the prospects for continued high growth in 2017 and the coming years, as the government committed to pursue an accelerated spending program. Dominguez said this would not only sustain the economic momentum but would also spread the benefits of growth to all sectors across all regions with more jobs and better living standards. He said growth remained on the upswing on the back of rock-solid macroeconomic fundamentals. READ MORE...RELATED, BOI-approved investments up 20% at P441B in 2016...
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Killings, Duterte tirades may dampen investments – EU biz community
The European business community has two special wishes for President Rodrigo Duterte this New Year: that he address concerns on alleged extrajudicial killings and end his verbal assaults on the country’s international allies. AP/Aaron Favila, File
MANILA, JANUARY 9, 2016 (PHILSTAR) By Richmond Mercurio January 2, 2017 - The European business community has two special wishes for President Duterte this New Year: that he address concerns on alleged extrajudicial killings and end his verbal assaults on the country’s international allies.
European business leaders warned that the killings and verbal tirades could dampen investor confidence in the Philippines.
“We have seen uncertainty caused by statements done in the first couple of months since the new administration came in. European business has been here a long time and is still here for the long term. European companies are partners and are providing much needed jobs and foreign direct investments, hence helping the government to contribute to the overarching goal of inclusive growth in the country,” said Guenter Taus, European Chamber of Commerce of the Philippines president.
“Business can work with risks, but not with uncertainty. That’s why we are working closely with (department) secretaries to get their reassurance that the government, from its end, will be a stable and reliant partner for our European investors,” Taus told The STAR.
Aside from Duterte’s tirades on long-time allies the European Union and the US, the rising cases of alleged extrajudicial killings in the country are also alarming the European business community.
“Unfortunately, the focal point both domestically and internationally has been the infamous war on drugs and the tragic loss of life it has created. The picture of the Philippines painted by international headlines, while arguably not completely correct, has not in any way been beneficial to the Philippines,” Nordic Chamber of Commerce of the Philippines president Bo Lundqvist said.
He added that the negative headlines generated abroad have created an atmosphere of hesitation in terms of foreign direct investments.
“While I am in complete agreement with the new administration as it relates to the dangers of drugs to individuals and society as a whole, I believe human rights and respect for due process are hallmarks of any successful democracy and is a key component to what potential investors look for in terms of destination attractiveness,” Lundqvist said.
Outside the political concerns, the European business community also wants to see the government pursue the liberalization of economic restrictions and tax reform, revise its Public Services Act, retain investment incentives, implement the Competition Act and come up with legislation on energy efficiency.
RELATED FROM THE INQUIRER
Duterte approval rating at 83%—Pulse Asia By: Kristine Angeli Sabillo - @KSabilloINQ
INQUIRER.net / 01:59 PM January 06, 2017
President Rodrigo Duterte. INQUIRER FILE PHOTO / GRIG C. MONTEGRANDE
President Rodrigo Duterte’s approval and trust ratings, both at 83 percent, remained high during the last quarter of 2016, according to the latest Pulse Asia survey.
“Amidst various controversies involving him and his administration, most Filipinos remain appreciative of the work done by President Rodrigo R. Duterte,” the survey firm said in a release.
The poll, conducted from December 6 to 11 among 1,200 respondents, has a ± 3% error margin at the 95% confidence level.
Among the events that unfolded before and during the survey period were the resignation of Vice President Ma. Leonor “Leni” Robredo, the Supreme Court decision dismissing petitions opposing the burial of former President Ferdinand Marcos at the Libingan ng mga Bayani and the Senate and National Bureau of Investigation probe into the killing of Albuera, Leyte Mayor Rolando Espinosa Sr.
Duterte’s ratings were more or less the same from last September when he received 86 percent for both his performance and trustworthiness.
Of the respondents surveyed in December, five percent disapproved of Duterte while 13 percent were undecided. Only four percent said they did not trust the President.
Among geographic areas, which have a ± 6% error margin, the President received the highest ratings from Mindanao (91 percent approval, 92 percent trust). This was followed by Visayas with an approval rating of 88 percent and trust rating of 86 percent.
Eighty-one percent of respondents from the National Capital Region said they trust Duterte. Eighty percent said they approve of him. His ratings in the rest of Luzon are slightly higher with 84 percent expressing approval and 82 percent saying they trust him.
Of the socioeconomic classes, Duterte received the highest rating from Class E respondents at 88 percent. RAM/rga
Screen Shot 2017-01-06 at 01.56.46 PM
Palace thanks nation for ‘very good’ rating for Duterte
Duterte still most trusted PH official–Pulse Asia
RELATED(2) FROM PHILSTAR
DOF warns of ‘disastrous’ consequences of pension hike By Prinz Magtulis (The Philippine Star) | Updated January 7, 2017 - 12:00am 2 7 googleplus0 0
The Department of Finance warned yesterday of “disastrous” consequences once populist measures on the two-year land conversion moratorium and Social Security System (SSS) pension increase without contribution hike are pursued. File poto
MANILA, Philippines – The Department of Finance warned yesterday of “disastrous” consequences once populist measures on the two-year land conversion moratorium and Social Security System (SSS) pension increase without contribution hike are pursued.
“We need to invest big in (infrastructure), human capital and social protection...Hence the need to generate a lot more funds to bankroll these pro-poor and pro-growth programs,” Finance spokesperson Paola Alvarez said in a statement.
“The government certainly cannot do so if the President’s economic team were to support populist proposals willy-nilly just to earn political pogi points for the Duterte administration,” she said.
Revenues, in particular, will take a hit as taxpayers may be forced to fund the increase by P2,000 in SSS pension without corresponding adjustment in members’ contributions.
Meanwhile, Alvarez said preventing the development of farm lands for better use, “would undermine the growth momentum.”
BAYAN MUNA CRITICISM
The statement came after militant group Bayan Muna criticized the economic managers for allegedly feeding President Duterte wrong information on the SSS plan, which was part of Duterte’s campaign promise.
They remarked these were the same officials that opposed the proposed land conversion moratorium for two years by Agrarian Reform Secretary Rafael Mariano, himself a leftist leader prior to entering the Cabinet.
The government’s economic team groups the DOF, the Department of Budget and Management and the National Economic and Development Authority.
Alvarez said all policy recommendations to Malacañang are studied carefully.
“(These) are anchored on sustaining high growth and enabling all sectors across all regions to benefit from it in the form of more jobs, higher incomes and better living standards,” she said.
Citing the government’s 10-point socioeconomic agenda, Alvarez said big-ticket projects nationwide would need “more, not less, funds” which will not be attained with the two proposed measures.
Without more revenues, the Duterte administration could end up doing a “disservice” to the public, she said.
The contentious SSS pension increase traces its roots back to the veto of former president Benigno Aquino III, who suffered a political fallout for asking for a contribution increase in exchange.
Duterte, during his campaign, promised to pursue the measure, only to backtrack later on upon the advice of his economic managers. Budget Secretary Benjamin Diokno had said candidate Duterte is “different” from President Duterte.
Meanwhile, Vice President Leni Robredo earlier opposed the moratorium on land conversion as this could hamper the government’s housing program.
“To pander to short-term populist initiatives will be a disservice to the President and the overwhelming majority of Filipinos who have given him the electoral mandate to effect real change,” Alvarez said.
Duterte, Trump headlined top business news in 2016 posted December 31, 2016 at 04:25 pm by Roderick T. dela Cruz
Duterte looks forward to working with Trump's government | Headlines, News, The Philippine Star | philstar.com
The election of Rodrigo Duterte and Donald Trump as presidents defined the business news in the Philippines in 2016, as their simple remarks could move markets and cause jitters among investors.
Duterte, the former Davao City mayor who brought his bloody anti-crime campaign to the national scene, shocked the business community when he shifted the country’s economic relations away from the US and towards China.
Trump, who will become the 45th US president on Jan. 20, 2017, vowed to bring back jobs to the US by tightening immigration controls and restricting job outsourcing. The Philippines, the world’s call center capital, is edgy.
Aside from Duterte and Trump, here are the other top business news in the Philippines last year.
PH grows fastest in Asia
The Philippines posted one of the fastest growth rates in Asia in 2016. Data from the Philippine Statistics Authority show that its gross domestic product expanded 7.1 percent in the third quarter and 7 percent in the first nine months, beating the government’s target of 6 percent to 7 percent for the year.
The World Bank in turn upgraded its 2016 growth forecast for the Philippines to 6.8 percent from the previous estimate of 6.4 percent.
The Washington-based multilateral lender said it revised upward its projections for the Philippines as a part of its quarterly forecast exercise “considering recent trends.”
“Recent economic trends illustrate the high confidence among investors and consumers, and provide the foundation for a more optimistic outlook for the remainder of 2016 and for 2017,” said World Bank lead economist for the Philippines Birgit Hansl.
The World Bank also revised upwards its 2017 growth projection for the Philippine economy to 6.9 percent from its October estimate of 6.2 percent. In 2018, the economy is expected to expand 7 percent.
The bank said the growth in capital investment would remain the Philippine economy’s primary growth engine.
The Investor Relations Office of Bangko Sentral ng Pilipinas said the Philippines would remain on a “sweet spot” of high growth and manageable inflation in 2017, as more opportunities open up and outweigh the impact of external headwinds.
The government set an economic growth target of 6.5 percent to 7.5 percent and an inflation target of 2 percent to 4 percent in 2017.
DENR shuts down mines
Regina Lopez, the staunch environmentalist who was appointed the secretary of the Department of Environment and Natural Resources, ordered an audit of mines in the country. The audit resulted in ten mines being shut down while another 20 face suspension.
She also cancelled the environmental permits of three nickel mines and warned that three more producers were at risk of losing theirs.
The Philippines, the world’s top nickel ore supplier is reviewing hundreds of environmental compliance certificates, including those granted to mines.
The DENR is expected to come out with a final decision on 30 mining companies. The audit, which started in July 2016, dragged on, hurting the operations of companies.
As a result, the value of mineral production declined 11 percent in the first three quarters from a year ago.
Car sales exceed 300,000
Sales of motor vehicles in the Philippines climbed 22.2 percent year-on-year in November 2016, bringing total sales in the first 11 months to more than 300,000 units.
The Chamber of Automotive Manufacturers of the Philippines Inc. and Truck Manufacturers Association said in a joint report that their members sold a total 32,966 vehicles in November, up from 26,979 units delivered in the same month last year.
“The good sales performance last November was because of enticing promotions and events matched with good demands of our market. With the robust demand, especially this Christmas season, we expect a stable to higher sales by December,” said Campi president Rommel Gutierrez.
Campi said as of November, automotive sales already surpassed the full-year 2015 sales, with 325,468 units sold. This was 24.3 percent higher over last year’s 11-month sales of 261,930 units.
Stocks, peso slide
The peso fell 5.7 percent, while local stocks lost 1.6 percent in volatile trading last year, as the US Federal Reserve’s interest rate hike and Donald Trump’s surprise win in the American election pulled money away from emerging markets such as the Philippines.
The Philippine Stock Exchange index, the 30-company benchmark, closed at 6,840.64 on Dec. 29, the last trading day of the year.
NEW YEAR. Traders celebrate during the last day of trading in front of a giant electronic board at the Philippine Stock Exchange in Manila on Dec. 29, 2016. AFP
Meanwhile, the peso ended the year at 49.72 against the US dollar, still near a decade low. The local currency depreciated 5.7 percent in 2016.
Jobless rate, poverty ease
Both unemployment rate and poverty incidence eased last year, as the strong economic growth generate thousands of jobs and lifted many people of out poverty.
Results of the Labour Force Survey conducted by the Philippine Statistics Authority show that unemployment rate eased to a record low of 4.7 percent in October from 5.6 percent a year ago.
“This means that the growth of our economy is becoming more inclusive as it engages more and more Filipinos to participate in the labour market,” said Economic Planning Secretary Ernesto Pernia.
Poverty incidence dropped to 21.6 percent of the population in 2015 from 25.2 percent in 2012 and 26.3 percent in 2009, according to PSA.
The National Economic and Development Authority said this meant there were 1.8 million less poor Filipinos last year, compared to 2012. This also put the Duterte administration’s goal to reduce poverty rate to 17 percent by 2022 on track.
“We’re confident that it can be reduced so much more, especially now since we are coming from a much lower base which is at 21.6 percent. And from 2012 to 2015, that’s actually a 3.6-percentage point reduction over a period of three years,” Neda assistant director-general Rosemarie Edillon said.
Online gaming shut down
President Rodrigo Duterte has ordered the closure of online gaming operations in the Philippines, saying corruption in the approval of gaming licenses has become rampant.
The country’s gaming regulator earlier refused to renew the license of PhilWeb Corp., an online gaming operator owned by businessman Roberto Ongpin, after he was singled out by President Duterte as among “oligarchs” that he wanted to destroy.
Meanwhile, Chinese gambling tycoon Jack Lam fled from the Philippines after authorities raided his casino operations in Clark Freeport and Fort Ilocandia, after he allegedly offered a bribe to government officials for the release of over 1,000 Chinese workers in his gaming sites.
The resort’s gaming facility in Clark was also shut down due to lack of permits and alleged illegal or unlicensed gaming operations.
Visitor arrivals hit new record
International visitor arrivals in the Philippines rose 12 percent year-on-year in the first nine months of 2016 to hit a record 4.46 million.
With the increase, the Philippines is on track towards reaching its 6 million tourist arrivals target for the year.
South Korea, US, China, Japan and Australia remained the top five source markets of the Philippines, he added.
For the month of September, visitor arrivals reached 422,943, up by 7.5 percent from 393,589 arrivals in the same month last year. It is the first time that visitor volume for the month of September surpassed the 400,000 mark.
Consistent growth was observed throughout the year with double-digit gain from January to July except for the month of May. The biggest volume was recorded in July while the highest growth was registered in the month of February.
BPO survives Trump’s election
The Information Technology and Business Process Association of the Philippines (IBPAP) expects the continuous growth of the IT and Business Process Management Industry, despite the win of Donald Trump in the US election.
New high-rise buildings are being constructed in Cubao’s commercial district in Quezon City, as the area benefits from the expansion of business process outsourcing industry and real estate sector.
The IT-BPM sector contributes 10 percent to the gross domestic product and provides jobs for over a million Filipinos. IBPAP expects the industry to generate $25 billion this year and over $40 billion by 2022.
Trade deficit widens to $20b
The balance of payments (BoP) position of the Philippines reversed to a deficit in the first 11 months of 2016, pulling down the value of the peso to a near 10-year low, amid a record trade deficit this year.
Data from the Central Bank show that the BoP, which reflects the country’s transactions with the rest of the world, posted a deficit of US$206 million in January to November, a turnaround from the US$2.136-billion surplus a year ago.
The country incurred a record merchandise trade deficit of nearly $20 billion in the first 10 months, as imports continued to outgrow exports. Merchandise trade is the largest component of BoP.
Duterte: Trump wishes Philippines success in drug war | Headlines, News, The Philippine Star | philstar.com
Duterte banks on China investments
President Rodrigo Duterte asked China to invest in the Philippines during his state visit in the world’s second largest economy.
President Duterte’s four-day state visit to China in October healed the bilateral relations between the two countries which were strained by a maritime dispute in the South China Sea.
China-led Asian Infrastructure Investment Bank committed to help fund President Duterte’s infrastructure overhaul, which includes two projects in the capital.
The AIIB will co-finance with the Asian Development Bank and the World Bank, the P37.76-billion Edsa Bus Rapid Transit System and the P23.46-billion Metro Manila flood control project, respectively.
Govt cancels e-vehicle program
The Electric Vehicle Association of the Philippines is adopting a new roadmap for the domestic e-vehicle industry as it looks to recover from the recent decision of the Energy Department to scrap the $500-million electric tricycle project.
The Energy Department previously issued the notice of award to Uzushio Electric Co. Ltd. of Japan and local partner Bemac Electric Transportation Philippines Inc. for the supply of 3,000 units of e-trikes.
Energy Secretary Alfonso Cusi, however, said said the e-trike project proved to be too costly.
The project, largely financed by the ADB and the Clean Technology Fund, was supposed to deploy 100,000 e-trikes nationwide to replace the same number of traditional gasoline-fed tricycles, reduce the transport sector’s annual petroleum consumption by 2.8 percent (equivalent to 89.2 million liters) per year and achieve 79-percent carbon dioxide foot print avoidance.
Bangladesh heist rocks banking sector
The Anti-Money Laundering Council tightened the regulations on money laundering, 10 months after some $81-million were allegedly stolen from Bangladesh Bank’s account in New York and laundered to a Philippine bank.
Officers of AMLC also filed money laundering charges before the Justice Department against several officials of Rizal Commercial Banking Corp. in connection with the$81-million laundering scam that rocked the domestic banking industry in February.
Senate investigations earlier found out that the $81-million fund was stolen by cyber thieves from the account of Bank of Bangladesh in Federal Reserve in New York. The dirty money entered the country’s financial system through an RCBC branch on Jupiter Street in Makati City.
Former RCBC president and chief executive Lorenzo Tan resigned from his post at the height of Senate investigation into the case.
Bangko Sentral also imposed a P1-billion penalty on RCBC for its alleged involvement in the scam.
Govt to terminate ‘endo’ scheme
The Employers Confederation of the Philippines expressed support to the government’s attempt to end the practice of labor contractualization or end-of-contract (endo).
The Labor Department said that since the start of the government’s crackdown against endo, over 25,000 contractual workers were accorded with regular status by their employers. The agency vowed to end labor-only contractualization by the end of 2017. Several companies, however, expressed concern over the plan.
Semiconductor giant Texas Instruments Philippines Inc. opposed measures that would penalize firms which hire contractual workers for a limited period.
RELATED FROM PHILSTAR
YearEnder: Duterte honeymoon is over for the stock market By Iris Gonzales (The Philippine Star) | Updated January 2, 2017 - 12:00am 0 4 googleplus0 1
Shown in photo during the last trading day ceremonies at PSE Tektite are (from left) PSE vice president for corporate governance risk and compliance J. Argel Astudillo; Wong Securities Corp. nominee Eden Wong, Sincere Securities Corp. vice president and treasurer Teresita Ocampo; Luys Securities Co. Inc. director Aurora Shih; PSE director Eddie Gobing; Summit Securities Inc. nominee Harry Liu, Trans-Asia Securities Inc. nominee Eugene Ong; Alakor Securities Corp. nominee Victor Benavidez; H.E. Bennett Securities Inc. nominee Joel Dela Pena, and Imperial de Guzman, Abalos & Co. Inc. nominee Diosdado Yumul.
MANILA, Philippines – The honeymoon is over; love has flown out the window.
This might be any married couple’s story, but unfortunately for stock market investors, it’s also a story that can best describe the market for most of the latter part of 2016.
For the second year, Philippine shares closed lower in 2016. The benchmark Philippine Stock Exchange index (PSEi), the local stock barometer, closed at 6,840.64 on Dec. 29, 2016, the last trading day or down 1.6 percent or 111.44 points from end-2015 level of 6,952.08 and down 0.09 percent from the previous day’s close.
In terms of total capital raised from the stock market for 2016, this amounted to P170.12 billion, slightly lower than the P184.60 billion raised for the whole of 2015.
The good news is market volatility, like financial crises, is only temporary. The bad news is, investors and pundits alike have no choice but to ride the waves, with the ups and downs.
Indeed, the stock market is experiencing one of the most volatile times in recent history, no thanks to President Duterte’s tirades against the country’s trading partners and a mouthful of slurs every so often.
Of course, the president’s supporters and even some of the country’s businessmen refuse to fault the popular Philippine leader, opting instead to put the blame on global uncertainties.
Whatever it is, one thing is clear, the post-Duterte rally is over. Stocks rose to a 15 month high in June after President Duterte won the presidency in a landslide victory in May.
The benchmark Philippine Stock Exchange index, the local market gauge, rallied 33 percent from a January low through the July 21 peak as he promised to ramp up infrastructure spending – the golden age of infrastructure, he said, cut corporate taxes, eradicate the drug problem and address rampant corruption.
That day, the index gained 50.55 points or 0.63 percent to finish at 8,102.30, its highest in 15 months and close to the all-time record high of 8,127.48 seen on April 10, 2015.
This was quite a relief for a lackluster performance of the market for most of the first half of 2016 because of the pre-May election jitters, the uncertainty associated with China’s economy and slowing growth in emerging market economies.
In 2015, the PSEi closed at 6,952.08, down 3.85 percent from 2014’s 7,230.57.
When President Duterte won, many thought the market’s rise wasn’t just a welcome reception for the new president.
Unfortunately, the euphoria melted just as soon as it swept the market.
This comes as no surprise because President Duterte’s tirades, primarily against the US sent jitters to foreign fund managers. He said he was cancelling military exercises and other cooperation with the US.
New York-based think tank Global Source said the President’s loose speech cannot but give investors pause and his anti-Americanism is fueling leftist militancy and empowerment that, if left unchecked, would have real business consequences.
PHILIPPINE STOCK EXCHANGE
Moving forward, Philippine Stock Exchange (PSE) president Hans Sicat expressed hope the PSEi would finally stabilize in 2017 and hit the 8,500 level and that the daily value turnover would improve to an average of P8-to P8.2-billion from the P6-to P7-billion levels recorded in 2016.
At the same time, he acknowledged, 2017 may continue to be volatile.
“We’ve been able to do a lot of things as well and there’s a lot of work ahead of us for 2017. We think 2017 will continue to be or we’ll start off being a highly volatile year. A volatile start to the year I could see and I think we’ll have to figure out how events will develop in January and February before we can give a more educated guess as to where the market will be,” Sicat said.
He said investors are still trying to get signals from the United States.
“I think the issue is that you have competing economic philosophies at work now and the signaling maybe from the US is that it’s going to be more inward looking, perhaps even more protectionist which is very much at odds with what the globe has been seeing over the last few years, even decades, about trying to have regional integration, more open borders, trade for both goods and services, so it’s not clear where the chips will fall,” he said.
Overall, however, Sicat believes Asia still seems to be the bright spot in terms of economic growth and intra-regional trade.
Nevertheless, Sicat said the biggest challenge is that it’s still too hard to predict exactly what will happen.
“It’s very different from previous years when you would have an idea where, let’s say governments and maybe even global central banks are signaling very clearly what they will do. The world, for example, two years ago, was talking about quantitative easing, right? That seems to be the model and I think the conventional wisdom is kind of geared towards that concept and no one was talking about shutting trade flows or even capital market flows. Now, you don’t know which side is going to win this debate and that’s the biggest challenge,” Sicat said.
This, he said, is a huge challenge for the global equities market around the world.
On the home front, Sicat said investors would get a lot of signal from the January and February budget numbers.
“Was the government able to actually disburse and spend a higher proportion of the budget relative to gross domestic product (GDP), because that will be a very strong signal the infrastructure growth program is actually on its way because right now we hear what they want to do, but we haven’t seen the numbers yet,” Sicat said.
If the numbers show higher spending, it means the plan of the economic team has a lot of leg.
“I think it is the biggest play for the Philippines,” Sicat said.
He cited China as an example and how its economy grew as a result of massive infrastructure spending over the last 20 years – just massive spending on roads, ports and buildings.
“There’s always been political issues at how you look at China and yet the growth of the economy and the level of interest in terms of participating in the economy by global investors are very strong so I think that if we are able to push the program, the multiplier effect is massive,” Sicat said.
The first quarter of 2017, he said seems to be quite volatile.
“But there are really a lot of countervailing forces at work. I think what will continue for the Philippines is that it’s still a consumer economy and it will not dissipate,” Sicat said.
RELATED(2) FROM PHILSTAR
Low interest rates to remain – DOF By Prinz Magtulis (The Philippine Star) | Updated January 7, 2017 - 12:00am 0 1 googleplus0 0
The Philippines could continue to enjoy low interest rates this year as strong economic performance offset a phenomenon kicked off by rising US rates, Finance Undersecretary Gil Beltran said. File poto
MANILA, Philippines – The Philippines could continue to enjoy low interest rates this year as strong economic performance offset a phenomenon kicked off by rising US rates, Finance Undersecretary Gil Beltran said.
“The reversal of US QE (quantitative easing) policies will push up the country’s real borrowing costs, but with improved fundamentals, the rise will be dampened,” Beltran said.
He mentioned this on his latest economic bulletin submitted to Finance Secretary Carlos Dominguez. A statement on the bulletin was released yesterday.
Interest rates are poised to rise globally after the US Federal Reserve adjusted upwards its interest rates in December last year.
That marked the second move in a decade of cheap credit meant to revive the world’s safe haven after the global financial crisis in 2008.
Normally, local rates follow the trend in the US, but Beltran claimed that primary nominal bond rates fell to 3.86 percent “ahead of the US expected rate increase.”
Based on Treasury data, however, weighted average interest rate of government debt inched up 4.98 percent in November from five consecutive months of decline.
Higher rates do not bode well for the government as this means allocating more funds for debt payments than public projects. For consumers and investors, this means higher interest in bank loans.
Beltran, nevertheless, said the country’s investment grade could also push interest rates lower. An investment grade credit rating meant the government has more than enough capacity to settle its debts.
“This was attained through fiscal strengthening with the passage of the VAT (value-added tax) reform law in 2006, debt management measures, prudent spending and appropriate monetary policy,” Beltran said.
“The financial markets (even) recognized the country’s investment grade status earlier than the CRAs (credit rating agencies) did,” he said.
Sought for comment, Astro del Castillo, managing director at First Grade Holdings Inc., agreed with Beltran, saying despite “some adjustments,” rates are likely to remain low.
Diokno likens redundant tax incentives to pork barrel; Tax perks need to be reviewed By Alexis Romero (philstar.com) | Updated January 3, 2017 - 4:52pm 0 0 googleplus0 0
Diokno said tax incentives have resulted in revenue losses equivalent to 1 to 2 percent of the country’s GDP. File
MANILA, Philippines — Budget Secretary Benjamin Diokno has likened redundant fiscal incentives to “pork barrel” as he cited the need to review tax perks that have led to significant losses of state revenues.
Diokno said tax incentives have resulted in revenue losses equivalent to 1 to 2 percent of the country’s gross domestic product (GDP). The GDP is the sum total of the goods and services produced by an economy in a given period.
“We will review the tax incentives. There are many businesses that will remain profitable even if they are not given incentives. The incentives are redundant,” Diokno told radio station dzMM in Filipino last Monday.
“I call the incentives pork barrel on the tax side. If you are a congressman or a senator, you would sponsor a bill that would provide incentives to a sector, which would definitely help you once you seek reelection,” he added.
“Pork barrel” refers to lawmakers' allocations for their chosen projects. Critics said the system has led to corruption and patronage politics.
“Because of the pork barrel on the tax side, the revenues that the government should be earning to sustain education and welfare are sacrificed,” Diokno said, adding that only the big firms benefit from the incentives.
Bills seeking to rationalize fiscal incentives have been filed in previous congresses but they were bypassed.
Diokno said the administration is also pushing for a bill that would impose a specific tax on gasoline and diesel. Diesel is exempted from excise tax.
“Many rich people drive diesel-run vehicles. The argument that you are not pro-poor if you slap taxes on diesel is no longer applicable,” Diokno said.
RELATED FROM ABS-CBN
Lacson: 'Pork' shifts from LP to Mindanao solons Dharel Placido, ABS-CBN News Posted at Jan 04 2017 06:59 PM
Senator Panfilo Lacson
MANILA – Senator Panfilo Lacson on Wednesday claimed that several lawmakers got as much as P5 billion in “pork barrel” under the 2017 General Appropriations Act.
Lacson said he learned about this during a talk with House lawmakers aimed at resolving last year's impasse on the national budget.
During the budget plenary debates, Lacson and lawmakers from the lower house hit a deadlock after the senator insisted on removing P8.3 billion the lawmakers took from the budget of the Autonomous Region in Muslim Mindanao (ARMM) and allocated to the Department of Public Works and Highways (DPWH).
READ: Amid budget impasse, House claims no pork in 2017 budget
“The ARMM congressmen came to see me to plead their case. Inabot nga kami ng 10 p.m. sa office ko (Our meeting lasted until 10 p.m. in my office) explaining in so many words, thus – ‘buti nga daw sila, tig P1.5-B lang na projects, yung iba raw mga congressmen abot ng tig P5-B (they said they only get P1.5 billion in projects each, while others get P5 billion each),’” Lacson said.
“Change is coming? Maybe, pero (but) it's (pork allocations) changing hands from LP (Liberal Party) congressmen to those from Mindanao.”
Lacson, a staunch enemy of the pork barrel system, which used to be called Priority Development Assistance Fund (PDAF), believes that the approved budget is still laden with what he believes is an illegal form of funding.
READ: SC: PDAF is unconstitutional
Davao City Rep. Karlo Nograles. MARC JAYSON CAYABYAB/INQUIRER.net Davao City Rep. Karlo Nograles on Wednesday denied Senator Panfilo Lacson’s claim that as much as P5 billion pork barrel was allocated to some lawmakers in the 2017 budget. “That’s not true. There is no pork barrel. There is no PDAF in the budget. There are no post-enactment projects in the budget. You will only see specific line-item projects that have been identified by different agencies and departments of government,” Nograles said. Nograles assured Lacson that Congress strictly adhered with the high court’s decision scrapping the pork barrel and prohibiting the post-enactment identification of projects. “We in Congress also exercise strict adherence against the pork barrel to ensure that we comply with the Supreme Court decision. If anything, we have made doubly sure that projects and programs are even more specific so there will be no room at all for post-enactment,” Nograles said.
“What I'm trying to say is, Filipinos are made to believe that PDAF is dead after the SC [Supreme Court] ruling in 2013. I am not stupid. Filipinos are not stupid. They are just resigned, I think. After all these years that I and my staff scrutinize the budget books year in and year out, I know pork when I see it,” Lacson said.
“I believe our people, especially our taxpayers, should know the real score behind all these pretenses and denials about the existence of pork.”
Lacson also claimed that some of his Senate colleagues quipped that their lower chamber counterparts apparently got bigger pork allocations than them.
“At least two of my colleagues commented in the lounge during session suspensions, ‘Sobra naman sila... tayo ngang mga senador, tig P300-M lang (they're too much... even us senators only got P300 million),’” he said.
Lacson clarified, however, that as in the past, he did not submit a list of projects for the supposed P300 million pork barrel allocation.
“Senators Tito Sotto and Kiko Pangilinan approached me on separate occasions to inform me that they too did not submit. I don't know who else among my Senate colleagues likewise did not submit their list,” he said.
“There is no saying here that those who identified their projects in the 2017 national budget, both from the Senate and the House, would get commissions from contractors.”
The House leadership has been insisting that the contested funding cannot be considered as pork barrel since no post-enactment intervention will be carried out.
Filipina cited as ‘Global Visionary’ By: Doris Dumlao-Abadilla - Reporter / @philbizwatcher
Philippine Daily Inquirer / 01:45 AM January 01, 2017
Analisa Leonor Balares
Growing up poor didn’t stop Analisa Leonor Balares from getting an Ivy League education, working at Wall Street, and sharing similar opportunities with other women and girls through her Womensphere Foundation.
She was born into a poor family — her father was a family driver and her mother a househelp — but brains, perseverance and innate leadership skills propelled Analisa Leonor Balares into getting an Ivy League education that eased her way into becoming a rainmaker at Wall Street, a valuable manager who brings in business from wealthy clients.
But wanting to work toward a more inclusive and sustainable world by helping empower women and girls made her quit the corporate world in 2008 to put up Womensphere Foundation, a global organization that seeks to accelerate women’s advancement in leadership, innovation and entrepreneurship.
New York-based Balares was recently handpicked by Swiss global banking giant UBS as one of its inaugural batch of “Global Visionaries,” described as a select pool of 10 extraordinary people who dedicate their lives to projects, research, movements and technologies that have the potential to profoundly impact our lives and the society we live in.
“Analisa understands the economic benefits of higher participation rates of women in the workforce and that a holistic approach needs to be applied to women’s education and development,” said Simon Smiles, chief investment officer at UBS Wealth Management.
Added Smiles in an Inquirer e-mail interview: “Analisa has drawn on her own experiences to design Womensphere’s distinctive community and ecosystem approach (and) apply it for women’s development in Science, Technology, Engineering, Art and Mathematics (STEAM) subjects across all socioeconomic classes and generations.”
Since its launch in early 2008 when the markets were crashing, Womensphere has reached more than 10,000 leaders, and inspired and trained more than 5,000 emerging women leaders on leadership, entrepreneurship, innovation and STEAM.
“That is just the very tip of the iceberg,” Balares said in an e-mail interview with Inquirer. “As we scale through technology, our digital initiatives alone will enable us to reach, inspire, educate and empower many times that number within one year.”
Analisa Leonor Balares is Chair and Founder of the Womensphere Foundation, CEO and Founder of the Womensphere global leadership community and social enterprise, and Creator of Heroine Media.
Born in Leyte, Balares juggled living in the world of the ultrarich, urban poor and rural countryside when she was growing up. Both her parents worked for a benevolent American family who lived in Forbes Park, where she stayed while attending Guadalupe Elementary School in Makati.
“Despite growing up poor in the Philippines, I felt empowered to succeed because of the mentors and role models I had when I was really young,” she said in a video produced by UBS.
Balares spent the first 16 years of her life in the Philippines before going abroad on educational scholarships. While she lived in North Forbes Park, she was well-exposed to Makati’s poor neighborhoods which she had to traverse on her way to school.
Since age 13, Balares had been organizing leadership training conferences and science camps for high school students in Metro Manila as Manila and NCR chair of the Philippine Society of Youth Science Clubs.
At Manila Science High School, as part of the team that won national competitions, she found herself representing the country in science fairs in Singapore and Thailand.
By the time she was 16, Balares’ academic achievements and student leadership experience opened up a number of scholarship opportunities. She accepted an offer from the Canadian International Development Agency and Ayala Foundation for a two-year International Baccalaureate program at Lester Pearson United World College in Vancouver.
While in Canada, she received a full scholarship to study at Mount Holyoke College, the first college for women in the US, where she majored in Economics and Math.
In New York, Balares joined Goldman Sachs in High Technology Investment Banking, where she worked on $1.5-billion worth of high-tech corporate financing and merger and acquisition deals.
She also worked at asset management firm Milestone Capital. In 2005, she obtained her MBA from Harvard Business School.
Prior to the UBS citation, Balares was honored as a “Young Global Leader” by the World Economic Forum. She was also handpicked as one of “30 Outstanding Women Leaders” by the National Council for Research on Women, and received the Madam C.J. Walker Leadership Award from the National Minority Business Council.
The New Leaders Council honored her as well as one of its “40 Under 40 New Leaders in America.”
Balares takes such leadership recognition in stride. “Within Womensphere, we have a view that everyone can be a leader, an innovator, (or) an entrepreneur and that you don’t have to go to an Ivy League institution to achieve this.
“This is why it is important to democratize access to knowledge. We need to take the best practices coming from Ivy League institutions, companies, governments and communities, and disseminate this information,” Balares said.
Annalisa Balares , CEO -WOMENSPHERE, - Pinay in USA PHOTO FROM ILLUSTRADO LIFE: FILIPINO EMPOWERMENT
Womensphere, she said, is building a global network of incubators designed to empower women and girls, with each incubator offering them five things: ecosystem, community, connections with inspiring role models, training and education, as well as recognition and awards.
It is also important to have a digital component to reach the over 1.5 billion internet users who are women and girls, Balares added. The internet allows Womensphere to deliver the same type of training and education it offers live in communities.
For women in rural communities without internet, Womensphere reaches out through local partnerships. An example is its partnership with Sen. Bam Aquino, which enabled the group to reach women in rural areas.
“For a program to succeed, it needs to be integrated— through partnerships—into local communities and within institutions where women are learning and working,” Balares said.
“We also have a range of programs that focus on women—from first-time entrepreneurs or those just starting college, to women who are in the middle of their careers and need help progressing to the next level of leadership.”
ALSO FROM THE INQUIRER
Tetangco wants stronger powers for AMLC to run after tax dodgers By: Daxim L. Lucas - Reporter / @daxinq Philippine Daily Inquirer / 12:30 AM January 06, 2017
With six months left in his term as the chief monetary and banking regulator, Bangko Sentral ng Pilipinas (BSP) Governor Amando Tetangco Jr. Thursday began a final push to reform the country’s financial system including a proposal to strengthen anti-money laundering laws that will likely be scrutinized thoroughly by lawmakers.
Speaking before members of the Rotary Club of Manila on Thursday, the BSP chief said the measures were meant to strengthen the local banking system, and to align the Philippine practices with increasingly strict international measures meant to combat cross border flows of illicit funds.
“We want to include tax evasion on the list of predicate crimes,” he told reporters, referring to illegal activities that would warrant the Anti-Money Laundering Council (AMLC) to freeze bank accounts of suspected violators and prosecute them.
Tetangco, whose second six-year term at the helm of the central bank ends on July 5, also wants Congress to strengthen the Anti-Money Laundering Act of 2001 to include the Philippines’ growing casino industry under the coverage of the AMLC which acts as the country’s financial intelligence unit.
BANGLADESHi CYBER-ROBBERY ATTEMPT
The move to strengthen anti-money laundering measures gained fresh impetus last year after cyber thieves attempted to steal $1 billion from the Bangladeshi central bank, $81 million of which was successfully funneled into the local financial system through the Rizal Commercial Banking Corp. before disappearing into the local casino industry.
At present, however, there is little evidence to show that Tetangco’s push to strengthen the anti-money laundering law has the support of the Executive, with no less than President Duterte himself regularly criticizing the AMLC and BSP for alleged anomalies which resulted in the 2016 release of bank account information allegedly belonging to then presidential candidate Duterte.
Nonetheless, the BSP chief said he believed there was a “good chance” his final push for reforms would be successful, especially with the support of Finance Secretary Carlos Dominguez III whose department stood to benefit with the decline in tax evasion incidences should a strengthened anti-money laundering law be enacted.
POSSIBILITY OF THIRD TERM
Tetangco also outlined other market reforms he intended to pursue as his term winds down.
This includes policy reforms and advocacies to broaden access to and affordability of financial services, improving the quality and variety of financial products, and promoting competitiveness and efficiency in the financial system.
The BSP chief also wants to strengthen good governance in banks, particularly in managing conflicts of interest, promoting financial transparency and enhancing market conduct.
Most importantly, Tetangco also wants to rein in the activities of non-bank financial firms currently outside the supervisory ambit of the BSP and other government regulators “to enhance consumer protection and consumer protection, and to contain shadow banking [activities].”
Asked about the possibility of serving a third term, Tetangco declined to speculate on the possibility ahead of reported efforts to convince lawmakers to amend the BSP charter to allow for it. Without naming names, however, he noted there are senior central bank officials who would be well qualified to replace him.
PAL expansion leads to corporate makeover in 2017 34 SHARES Share it! Published December 30, 2016, 10:01 PM by Emmie V. Abadilla
This 2016, on its 75th anniversary, Philippine Airlines’ (PAL) “Heart of the Filipino” marketing campaign coincided with its new corporate vision to be a five-star airline within five years, according to Jonathan P. Gesmundo, PAL Editorial Consultant.
PAL aims to be ranked five-star by Skytrax, a global airline rating organization, and rejoin the league of the world’s best airlines.
No wonder, “Get That Star” has become the mantra of PAL employees, he noted.
New PAL plane Airbus A350-900 New PAL plane Airbus A350-900
It also helped that the Centre for Asia-Pacific Aviation (CAPA) named PAL as the “Airline Turnaround for the Year 2016”, posting a six-fold increase in its income to $134.42 million over the previous year.
During the year, the airline took delivery of seven new aircraft – two Boeing 777-300ERs and five Airbus A321s – bringing its total fleet to 81. Aircraft deliveries continue until 2024.
THE EXPANSION FLIGHTS
Its expanded fleet allowed PAL to fly to four new international destinations (Kuwait, Jeddah, Doha, Saipan), open new routes (Cebu-Singapore, Cebu-Los Angeles, Manila-Taipei-Osaka, Cebu-Caticlan-Clark) and increase flight frequencies (Manila-Los Angeles – twice daily; Manila-Toronto – 3x to 4x weekly; Manila-Beijing – 4x to 6x weekly; and Manila-Vancouver – 7x to 10x weekly).
In January 2016, the flag carrier ordered six Airbus A350-900, a twin-engine jet designed for long-haul flights. In 2018, four A350s will be delivered and the last two, in 2019.
With the A350, PAL will be able to fly non-stop Manila-New York, through the Arctic region.
In addition, the airline ordered five new generation Bombardier Q400 turboprop planes, configured with 86 seats (10 seats more than the existing Q400 fleet) and choice seats in the forward section.
On top of these, PAL improved its inflight connectivity system via myPAL Inflight Entertainment System, which consisted of myPAL eSuite, myPAL Wifi, myPAL Mobile and myPAL Player apps.
MyPAL eSuite enables passengers to catch up on the latest movies, TV shows and music while flying.
With myPAL Wi-Fi, passengers can surf and browse the Internet, update and check social apps at 30,000 feet above ground.
On the other hand, myPAL Mobile allows passengers to call and text while myPAL Player app, available on both android and iOS, enables passengers to stream the latest movies, TV shows and music on their own device.
Other service enhancements include myPAL Upgrade for passengers who want to bid online for upgrades to Business Class; myPAL Roam, a global mobile hotspot for fast and affordable mobile data around the world; Mabuhay Miles Travel Card, a travel wallet; and the PAL Boutique selling exclusive co-branded travel items.
In May, the International Air Transport Association (IATA) certified that PAL and PAL Express comply to global standards in ground safety and operations.
Throughout the year, the flag carrier proved to be a socially responsible corporate citizen, delivering relief goods to disaster areas, repatriating overseas Filipino workers (OFWs) in war-torn countries and helping financially-challenged Filipinos participating in international competitions.
For more than a week in August, PAL operated special direct flights to Medina in the Kingdom of Saudi Arabia to fly Filipino Hajj pilgrims;
PAL even adopted a Philippine eaglet, ‘Sinag,’ and donated a million miles convertible to free tickets to the Philippine Eagle Foundation to aid their efforts to preserve this endangered species.
In September, PAL opened its first contact center in China, serving passengers from seven mainland cities – Beijing, Guangzhou, Hong Kong, Macau, Jinjiang, Shanghai, Xiamen.
RELATED FROM AIRLINES NEWS AND ANALYSIS BLOG
Philippine Airlines launches first international service from Clark 3 Jan 2017 // Latest Airline Route News // 2 Comments »
Philippine Airlines’ first flight back to Clark from Seoul Incheon arrived at 02:14 on 2 January acording to Flightradar24.com. This is the Philippine national carrier’s first international route from Clark. However, Asiana Airlines and Jin Air both already operate between the same two airports.
Philippine Airlines has introduced its first international route from Clark (CRK) in the Philippines.
On 1 January the national carrier began daily flights to and from Seoul Incheon (ICN) using its 199-seat A321s.
The first flight from Seoul departed late on 1 January arriving in Clark early on 2 January, with the first departure from Clark later that day.
Competition on the 2,543-kilometre route comes from Asiana Airlines and Jin Air which both operate the airport pairing with daily flights. Philippine Airlines President Jamie Bautista said: “We will operate more flights outside of Manila not just to decongest the Ninoy Aquino International Airport (NAIA) but mainly to offer convenience to passengers who do not need to travel to Manila for their desired flights.”
Philippine Airlines already operates domestic flights to Caticlan from Clark with additional domestic routes being added in the coming weeks. See how Clark Airport’s FTWA compares to others from around the world.
TO READ THE LINKS ON THIS IMAGE CLICK HERE and scroll down.
PH set to sustain growth this year posted January 01, 2017 at 09:05 pm by Gabrielle H. Binaday
Finance Secretary Carlos Dominguez III
The Finance Department said it expects the Philippine economy to sustain its high growth this year, despite the “political noise” in the first six months of the Duterte administration.
Finance Secretary Carlos Dominguez III said he remained bullish about the prospects for continued high growth in 2017 and the coming years, as the government committed to pursue an accelerated spending program.
Dominguez said this would not only sustain the economic momentum but would also spread the benefits of growth to all sectors across all regions with more jobs and better living standards.
He said growth remained on the upswing on the back of rock-solid macroeconomic fundamentals.
Dominguez said the government was on track toward realizing its vision of lifting six million Filipinos from poverty and transforming the Philippines into a high middle-income country five years from now, with a per-capita gross national income of $4,100, or where Thailand and China are today.
He said the optimistic outlook on the Philippines as one of Asia’s fastest-growing economies was shared by credit raters and other international institutions such as S&P Global, the Asian Development Bank and the International Monetary Fund.
Dominguez said the Duterte administration was committed to pursuing the congressional approval of proposed comprehensive tax reform program―the first in 30 years―to ensure the financial sustainability of the government’s unparalleled spending on infrastructure, human capital and social protection for the most vulnerable sectors.
He said the economy’s strong showing in the third quarter with GDP growth of 7.1 percent―the best in three years―was driven in part by the onset of the Duterte presidency’s strong spending on infrastructure and the recovery of the agriculture sector from the prolonged El Niño-induced drought.
“This means there will be no letup in the Duterte administration’s commitment to spending big on urban and rural infrastructure as a growth driver, to guarantee sustained high―and inclusive―growth,” Dominguez said.
He said the government needed to invest heavily in programs to transform the economy from a consumption- to an investment-driven one, and at a much higher level from the current investment rate of 20 percent of GDP.
This would put the Philippines at par with vibrant neighbors that were investing between 30 percent and 40 percent of their respective GDPs.
Dominguez said the Duterte administration would also remain focused on other urgent measures such as fully implementing the Reproductive Health Law, modernizing agriculture to pull down food prices while increasing farmers’ incomes and leveling the playing field for micro, small and medium scale enterprises.
RELATED FROM THE MANILA TIMES
BOI-approved investments up 20% at P441B in 2016 BY RAADEE S. SAUSA, TMT ON JANUARY 3, 2017 BUSINESS
PHOTO FROM INVEST PHILIPPINES DOT GOV DOT PH
INVESTMENT projects approved by the Board of Investments (BOI) grew by 20.4 percent to P441.8 billion in 2016 from P366.7 billion in 2015, the second highest value of registered projects since 2000.
The registered projects valued at P466 billion in 2013 remains the biggest, according to government data.
However, the 20.4-percent growth exceeded the BOI’s 7-percent growth target for 2016.
Investor confidence remains the main driver of growing investment commitments to the country, Trade Secretary and BOI Chairman Ramon Lopez said on Friday, noting the presence of strong macroeconomic fundamentals and President Rodrigo Duterte’s 10-point socioeconomic agenda.
The Cabinet official said the President’s state visits in the early stages of the current administration also helped attract investors into the Philippines.
“With the investment missions that we are doing, investors have gained greater awareness of the Philippines’ strong and growing economy,” he said.
During the President’s state visits, he assured investors that the government will honor, secure and protect their investments, Lopez said.
The investment approvals in 2016 included 377 projects and were expected to generate 67,615 in new jobs when the projects become fully operational.
Eighty percent or P352.5 billion of the investment pledges was made by local companies, while 20 percent or P89.3 billion was pledged by foreign investors.
Foreign investment pledges this year are higher by 50 percent than the P59.5 billion in 2015. It was almost twice as much in the second semester compared with first semester—a clear indication of the growing interest and confidence of foreign investors in the country.
Topping the list of country investors were Australia at P30.5 billion. Singapore was second at P13.6 billion, followed by The Netherlands at P13.1 billion, Japan at P6.8 billion and South Korea at P6.4 billion. The rest is shared by various country investors.
Region 4A topped the list of regional recipients at P102.1-billion worth of projects. The National Capital Region was second at P95.3 billion, followed by Region 3 at P56.5 billion. A significant amount of investment, valued at P34.8 billion, was placed in the Cordillera Administrative Region, up by 40,528 percent from P85.6 million in 2015.
Topping the list of investment projects were power (P209.9 billion), real estate (P65.8 billion), construction (P62.3 billion), manufacturing (P49 billion) and transportation and storage (P23.4 billion). Investments in construction and manufacturing were among the fastest growing at 644.8 percent and 81.3 percent, respectively.
The real estate sector is expected to generate the most number of jobs at 32,055, followed by the manufacturing sector at 17,067.
Trade Undersecretary and BOI Managing Head Ceferino Rodolfo said the growing manufacturing industry is clearly the result of the Manufacturing Resurgence Program.
“The revival of the manufacturing sector is key to inclusive economic growth because it will generate much-needed, decent employment and help the country tap regional production networks,” he added.
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