February 24, 2014

February 24, 2014 Optimism still ‘very high’ ... Christmas bonus and other benefits that would be exempted from income tax. Entrepreneurs key in growi...

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February 24, 2014

Optimism still ‘very high’ MOST FILIPINOS remain optimistic that their lives will improve but their outlook on the economy has "downgraded," the Social Weather Stations (SWS) said in new report. Peso to weaken near P45:$1 THE PESO will likely weaken near the P45 to the dollar this week, as investors stay on the sidelines looking for fresh leads. Tariffs on Japan-made auto parts cut to zero PHILIPPINE TARIFFS on Japan-made vehicle parts, components and accessories have finally been cut to zero under a nearly decade-old bilateral trade deal. Officials to testify at USTR hearing GOVERNMENT officials will ask the Office of the United States Trade Representative (USTR) to remove the Philippines from a piracy watch list. Reforms said to have progressed THE AQUINO administration has made progress with regard to reforms sought by businessmen, officials of the American Chamber of Commerce of the Philippines (AmCham) said. Three trade missions from US seen (Can also be read in Philippine Star) THREE TRADE missions from the United States are expected to arrive this year to explore business opportunities in the Philippines, an embassy official said on Friday. More foreign banks sought (Can also be read in Manila Bulletin, Philippine Star Philippine Daily Inquirer, Business Mirror, Manila Times, Manila Standard Today) MORE FOREIGN BANKS will be allowed entry, a senior Bangko Sentral ng Pilipinas (BSP) official said, with limits primarily confined to their share of the industry.

Solar rooftop project starts next month (Can also be read in Philippine Star Inquirer, Business Mirror) THE ENERGY department plans to jump-start the implementation of its solar rooftop program next month by installing solar panels to produce a total 2.4 megawatts (MW) in 24 Metro Manila school campuses, the Energy chief told reporters on Thursday night. ADB sets ‘inclusive business’ project POOR and low-income communities in Asia are expected to benefit from an Asian Development Bank (ADB) project to promote inclusive business in the region. Yields sideways amid interest in long-term debt, higher auction result YIELD TRACKER YIELDS on government debt papers ended mixed last Friday, with long-maturing bonds garnering interest after prices dropped and the other securities getting higher rates as a result of the Treasury’s recent five-year bond auction. Energy dep’t insists on lower power rate hike INITIAL RESULTS of the investigation conducted by the Energy department showed that the power rate increase in December would have been lower should generating facilities -- accounting for around 2,300 megawatts (MW) -- were offered in the Wholesale Electricity Spot Market (WESM). World recovery struggling to gain traction LONDON/NEW YORK -- Another month of slower factory activity in China and a sharp decline in a closely watched gauge of US manufacturing last Thursday added to concern about the state of the global economy. Changes in customs rules and processes Suits The C-Suite by Stephanie G. Vicente-Nava (First of two parts) TOWARDS the end of 2013, President Aquino issued Executive Order (EO) No. 155, which effectively dissolved the Post Entry Audit Group (PEAG) of the Bureau of Customs (BoC) and transferred its functions to the Fiscal Intelligence Unit (FIU) of the Department of Finance (DoF), in an effort to institute reforms in the BoC.

WB okays another $479-M loan for LGUs affected by ‘Yolanda’

The World Bank has approved $479 million loan for poor rural municipalities and areas affected by super typhoon “Yolanda” that struck central Philippines in November last year. Stocks seen to gain amid strong economy COL Financial Philippines, the country’s top online brokerage firm, expects the market to continue to consolidate in the first semester of 2014 but should start moving up in the second half in preparation for a strong 2015. 2014 IPP to limit grant of pioneer ITH The 2014 Investment Priorities Plan (IPP) will drastically limit the grant of pioneer incentives to investments by tightening the hurdles for projects that would be eligible for a juicy government incentive package that include the much soughtafter 8-year income tax holiday (ITH). Metro traffic solutions tackled in Summit (last part) Manila, Philippines — Days before the start of the work on the first two major road infrastructure projects in Metro Manila last week, the Metropolitan Manila Development Authority (MMDA) organized “Metro Manila Traffic Summit 2.”

Slower growth seen weighing on asset quality of AsPac banks MANILA, Philippines - Slower economic growth and uncertainty in global financial markets are seen to weigh on asset quality of Asia-Pacific banks this year, Standard & Poor’s Ratings Services said. Market seen trading sideways this week (Can also be read in Philippine Daily Inquirer, Manila Standard Today) MANILA, Philippines - Local stocks are seen to trade sideways with an upward bias this week as more favorable 2013 earnings reports trickle in. Investments in fixed assets to grow 10% MANILA, Philippines - Investments in fixed assets are likely to grow by more than 10 percent in the next two to three years amid the country’s improving competitiveness. Businessmen push EPIRA changes MANILA, Philippines - Businessmen urged the Aquino administration to support proposed amendments to the Electric Power Industry Reform Act of 2001 such as improving the role of the Energy Regulatory Commission (ERC). Gov’t to fasttrack measure on mining revenues sharing (Can also be read in Philippine Daily Inquirer)

MANILA, Philippines - The government is looking to fasttrack the draft bill for the revenue sharing scheme of the mining industry, a cabinet official said. BPO sector updates roadmap to 2020 MANILA, Philippines - The Information Technology Business Process Association of the Philippines (IBPAP) is planning to update its road map to set targets until 2020 as it seeks to grow and make the country a preferred destination for both voice and non-voice services. Davao biz sector wants MSMEs to scale up DAVAO CITY -- The business sector stressed the importance of scaling up existing micro, small and medium enterprises (MSMEs) and the government’s role in doing so. Is it the end for EPIRA? DEMAND AND SUPPLY By Boo Chanco Over the past two months or so, we have been hearing various stories, accusations and counter accusations from power industry participants on what or who really caused that atrocious hike in Meralco power rates. I don’t see closure coming around soon and that’s not good for the power industry.

Indicator points to high growth The Philippines’ gross capital formation, one of the leading indicators of the economy, is expected to continue growing by a double-digit pace over the next several years as the country remains a favorable investment destination in the region. Significant gains seen in plan to promote 7 ‘winner’ sectors The Aquino administration may have most likely posted significant gains in implementing the necessary reforms and recommendations proposed under the Arangkada Philippines report, the latest assessment for which will be out this week. Tobacco output jumped 11.8% in 2013 The domestic output of tobacco fired up by 11.8 percent to 53,750 metric tons in 2013 as prices rose and financing for farmers increased. BOC seeks help to reexport trash MANILA, Philippines—The Bureau of Customs (BOC) has sought the assistance of the Department of Environment and Natural Resources (DENR) in returning to

Canada 50 container vans of garbage, which were misdeclared as scrap plastic for recycling. JP Morgan raises 2014 growth forecast for PH American financial services giant JP Morgan sees the Philippine economy expanding at a faster clip than it previously expected this year, supporting local stock market resilience despite currency weakness, an inflation spike and heady valuation. US firms reconsidering PH as investment destination US firms have taken a renewed interest in tapping lucrative investment opportunities in the Philippines—particularly in the education, medical technologies and franchising sectors—as the country sustains its robust economic growth. Truck strike starts Monday in Manila (Can also be read in The Manila Times) MANILA, Philippines—Officials of trucker groups said Sunday they would push through with their threat to stage an indefinite strike starting at 8 a.m. at the Port Area in Manila on Monday, the first day of the implementation of an expanded truck ban in the city. Agri group scores ‘fear mongering’ on alleged WTO sanctions on PH (Can also be read in Manila Standard Today) MANILA, Philippines—The agriculture-industry alliance Samahang Industriya ng Agrikultura (Sinag) has scored former agriculture department officials and selfstyled trade experts for sowing fear of possible retaliatory trade sanctions should the Philippines continue to impose quantitative restrictions (QRs) on rice. Overcoming Asia’s resource challenge These are historic times for Asia. Recent years have seen the region’s economies enter an unprecedented phase of industrialization and urbanization. Tax break Editorial After the income-eroding and mood-depressing news on power rate hikes, gasoline price increases and monster traffic in the metropolis, the struggling middle class is given hope of relief through a long-overdue tax break. Senate President Franklin Drilon last week expressed optimism that before Congress goes on recess in March, it could pass a bill increasing to P75,000 the amount of the 13th-month pay, Christmas bonus and other benefits that would be exempted from income tax. Entrepreneurs key in growing jobs

Commentary by Curtis S. Chin BANGKOK—From the aftermath of Super Typhoon “Yolanda/Haiyan” to continuing tensions with both Hong Kong and mainland China, the Philippine government seemingly has more than enough to worry about than its 108th-place showing in a ranking for the ease of doing business. Expanding the poor’s access to finance Commentary by Ajay Banga, Jin-Yong Cai Nearly 2.5 billion people—half the world’s adult population—lack one of the most basic amenities of modern life: a bank account. They are among the world’s poorest, struggling to obtain the money they need to feed their families or start a business and create jobs.

Portfolio funds are coming back Foreign portfolio investments (FPI) continued to flow out in the first week of February, indicative of emerging-market economies, as the Philippines, whose macroeconomic gains are under threat as a result of policy choices made by the US Federal Reserve (the Fed), latest data from the Bangko Sentral ng Pilipinas (BSP) show. PHL group urges government, UN to come up with better post-MDGs framework Philippine civil-society organizations (CSOs) are urging the government and the United Nations (UN) to craft a better framework for the global future as the UN Millennium Development Goals (MDGs) adopted in 2000 expires next year. Aquaculture farms to use geothermal resources AQUACULTURE farms in Mindoro will be able to grow tons of triple high-quality tilapia, sea bass and shrimps per year, in a nutrient-rich, controlled temperature using water from geothermal power plants. Honey being developed as wound dressing RAW honey would no longer be limited to the food industry as experts from the Philippine Nuclear Research Institute, an agency of the Department of Science and Technology (PNRI) have developed a pharmaceutical use for honey. Bill giving PWDs VAT-exempt privilege gains ground in House The House Committee on Ways and Means recently created a technical working group (TWG) to fine-tune House Bill (HB) 1039, which seeks to grant valueadded tax (VAT) exemption on certain goods and services for persons with disability (PWDs).

FAO wants urgent support for small-scale fishers SMALL-scale fishermen need support to enter regional and international markets, the Food and Agriculture Organization (FAO) said on Friday, adding that the booming world fish trade is generating more wealth than ever before. The PHL’s GDP expected to grow in first quarter Rising Sun by Atty. Jose Ferdinand M. Rojas II / THE Philippine economy is expected to exceed 6.5 percent in the first quarter of 2014, supported by stronger imports and tourism earnings, according to Socioeconomic Planning Secretary Arsenio M. Balisacan.

RICE QUOTAS VIOLATE WTO PACT – DE LIMA Justice Secretary Leila de Lima believes that rice quotas imposed by the Department of Agriculture (DA) and National Food Authority (NFA) allowing government to monopolize the importing of rice may have violated the terms set by the World Trade Organization (WTO). Corporate earnings to rule stock market trend anew The next wave of corporate earnings is seen to dictate the trend for the stock market this week again given its favorable impact on Philippine shares during the prior trades. Is there a difference between branded and generics? With reference to pharmaceuticals, a resounding yes! Patent rights and rules of law specify the marketing for branded pharmaceuticals vis-à-vis generics. That is well within the province of intellectual property and patent rights. The real issues are life-threatening drugs that are kept under patent rights to the detriment of the populace. There should be no law that undermines human survival. Australia chips in $2.5 million for PPP The Australian government committed $2.5-million additional support to the public private partnership (PPP) program as its way of strengthening economic cooperation between the two countries. Social recruiting: Drifting job applicants are going downhill A FARMER was coming out of his farm along the back road of a remote rural area. Just as he pulled out on the road, a group of wild teenagers in a dilapidated truck sped over the hilltop and hit the farmer’s wooden cart being pulled by a pony. The farmer was lying pinned under the cart while his companion dog and the mule were badly wounded.

The need for an economic revolution Editorial As the country celebrates the 28th anniversary of the EDSA People Power revolution, a lot of ballyhoo will be made by the Aquino administration and its PR machinery on the legacy of that historic event.

1-M-ton rice import OK’d AFTER a heated exchange over the government’s failure to hit its rice selfsufficiency target last year, the National Food Authority Council has decided to import one million metric tons of long white rice, the biggest authorized under the Aquino administration so far. Meeting on truck ban set Malacañang said the truck ban ordinance of Manila may harm export and import industries. Presidential Communications Operations Office said a meeting will be called today to prevent any serious economic dislocation. BoI set to limit pioneer sectors The government is set to limit the sectors that will qualify for pioneer incentives in the upcoming 2024 version of the Investments Priority Plan. Viet rice overpriced The Philippine government lost P521 million in November last year after the National Food Authority entered into an allegedly irregular rice importation deal with Vietnam, according to official documents obtained by the Manila Standard Today.

Farmers need to produce quality cacao to compete globally CACAO industry players stressed the importance of producing high quality cacao for exporters to compete in the global market even as the Philippines is still a small player in the global cacao market. Cayetano urges biz groups to draw development plan

CITY OF SAN FERNANDO -- Senator Alan Peter Cayetano over the weekend urged business groups in Central Luzon to come up with a unified development plan that will entice investors to locate in the countryside and eventually decongest Metro Manila. Bank on eco-tourism to stand out, PH told FOR Philippine tourism to stand out in the coming Asean integration, it should consistently promote itself as an eco-tourism destination, according to an official of the United Nations World Trade Organization (UNWTO). Balisacan to give economic briefing in Cebu on Feb. 28 NEDA Director General and Socioeconomic Planning Secretary Arsenio Balisacan will be in Cebu on Feb. 28 to give a briefing on the performance of the economy and its outlook.