Philippines Update: November 8, 2018

PHILIPPINES UPDATE | November 8, 2018
Authors: Lilibeth Almonte-Arbez, Bryan Yeoh
 
LOOKING AHEAD
 
 

December 5, The 1st Asia-Pacific LNG Investment Summit

The Philippines is poised to have a thriving liquefied natural gas (LNG) industry within a few years with a projected capacity of 7 million metric tons annually by 2020. The country, therefore, will need big-ticket investments to realize its vision of becoming Southeast Asia's LNG hub.

Themed FUELING CHANGE. ENERGIZING GROWTH., the 1st Asia Pacific LNG Investment Summit Philippines is set to take center stage on 5 December 2018 at the Solaire Grand Ballrooms 2 to 5 in Manila, Philippines, to provide its delegates from the most prominent companies participating in LNG related operations a day of knowledge sharing and unparalleled networking and investment opportunities.

 
THE COUNCIL'S TAKE
 
 

Modest liberalization in 11th Foreign Investment Negative List (FINL)

A much anticipated update to the 10th FINL issued on May 29, 2015, the 11th FINL brought only modest changes and liberalized the following sectors:

  • 100% foreign equity in internet business (refers to internet access providers that merely serve as carriers for transmitting messages rather than being the creator of messages/information);
  • 100% foreign equity in adjustment companies;
  • Increased foreign equity from 20% to 40% for private radio communications network;
  • Increased foreign equity from 25% to 40% for contracts for the construction and repair of locally-funded public works;
  • Practice of professions subject to reciprocity rules and corporate practice rules including marine deck officers and marine engine officers, and foreign teachers in higher education not teaching a professional subject (i.e. included in government board or bar examination). A comprehensive Annex listed covered professions.

The 40 percent foreign ownership cap remained in the following sectors:

  • Public utilities but 100% foreign ownership is allowed in “power generation and the supply of electricity to the contestable market” and other like businesses or services not covered by the “public utilities” definition.
  • Educational institutions but 100% foreign ownership is allowed in those established by religious groups and mission boards, established for foreign diplomatic personnel and their dependents and other foreign temporary residents or for short-term high-level skills development that do not form part of the formal education system;

While business groups welcomed the easing of restrictions, they called for a “less negative list” and the amendment of the Foreign Investment Act, Public Services Act, Retail Trade Liberalization Act, Government Procurement Act, Investment Restrictions in Commonwealth Act No. 541, and the Contractors’ License Law. For a copy of the Executive Order 65 promulgating the 11th FINL issued on October 29, 2018, see the 11th Foreign Investment Negative List.

Senator Honasan offered as next DICT Secretary amid 3rd Telco bid

President Duterte confirmed that he offered Senator Honasan as the next Information and Communications Secretary. Eliseo Rio continues to be Acting Secretary until Honasan’s official appointment papers are signed and accepted. Honasan’s reported appointment comes during a bidding process for the third telecommunications company to break the duopoly of PLDT Inc and Globe Telecom in the country. Mislatel consortium has provisionally won the bidding. Composed of Davao businessman Dennis Uy's Udenna Corporation and its subsidiary Chelsea Logistics Holdings Corporation, the consortium also includes congressional franchise holder Mindanao Islamic Telephone Company and publicly listed China Telecommunications Corporation (China Telecom). One of the largest telecoms providers in Asia, China Telecom has over 250 million subscribers and is listed on the Hongkong and New York stock exchanges. During bilateral talks in November 2017, President Duterte had earlier offered Beijing through its Premier Li Keqiang to break the duopoly of Globe Telecom and PLDT-Smart in the country.

Senator Gregorio Honasan, better known as “Gringo” Honasan, currently serves as senator in the 17th Senate of the Philippines. Elected in 2013 to a 6-year senate term, he ran in the 2016 Vice-Presidential race and lost. He may step down before the expiry of his senate term to serve as DICT Secretary after official papers are signed and he accepts President Duterte’s appointment. Despite his role in sparking the 1986 EDSA revolution when civilians protected him and other military officers who tried to overthrow President Marcos, he led attempted coups d’état against President Corazon Aquino resulting in civilian deaths in 1987. Granted amnesty by President Ramos, he ran as an independent and won as senator in the 1995 elections. Senator Honasan is in good terms with President Duterte. The President has praised him as a revolutionary who changed Philippine history from a dictatorship to a democracy. He has stated that Senator Honasan "is a friend of mine, a good Filipino, and will be serving the country in years to come."   

Comparative Bids sought for USD$413.8 million Solid Waste Management PPP project

Quezon City, the most populous city in the Philippines, is inviting local and international entities to submit comparative proposals for the City's Integrated Solid Waste Management Facility PPP Project. Being undertaken as an incorporated joint venture, the Project could cost up to PhP22 billion, roughly USD $413.8 million, over a 35-year concession period. The Project involves the design, financing, construction, operation, and maintenance of a biodegradable source separated waste treatment and residual combustible waste treatment technologies capable of processing up to 3,000 metric tons of municipal solid waste (MSW) per day and generating 36 MWe (Net). The Project also involves the provision of the following infrastructure facilities: residual combustible waste (RCW) treatment facility; monofill for fly ash disposal; and other ancillary facilities, including continuous emission monitoring system, administration building, scale house, transmission lines, and utility systems and connections. The winning proponent will be determined based on a single bid parameter, i.e., the lowest tipping fee per metric ton of MSW (inclusive of VAT and other applicable taxes).

The consortium composed of Metro Pacific Investments Corporation, Covanta Energy LLC, and Macquarie Capital Limited submitted the Project as an unsolicited proposal. Quezon City has launched the Swiss/Competitive Challenge for the Project following the end of negotiation with the Original Proponent and the approval of the Project by the PPP Selection Committee. Challengers could now develop and submit their Comparative Proposals. To participate in the competitive challenge process, interested challengers must purchase Tender Documents available from October 30, 2018. The pre-bid conference has been tentatively set on November 22, 2018. The comparative proposal or bid submission is due on January 31, 2019. The Original Proponent has the right to match the lowest complying bid submitted by challengers. For more information, see the project information memorandum and PPP center press release.

 
ADVOCACY UPDATE
 
 

On November 1, the US-ASEAN Business Council hosted Assistant USTR Karl Ehlers for a briefing on his recent trip to the Philippines. AUSTR Ehlers highlighted policy engagements in southeast Asia and the recent Joint Statement by U.S. Trade Representative Robert E. Lighthizer and Philippine Secretary of Trade and Industry Ramon M. Lopez that took stock of recent achievements in the TIFA process:

  • US-PH has always had good engagement – historically strong and positive.
  • Leaders met in November 2017 and in their Joint Statement agreed to discuss an FTA under United States– Philippines TIFA.
  • The USTR-DTI October 22 Joint Statement demonstrated good cooperation in addressing existing irritants (cold chain, reference prices) and futures issues like extension of Philippine tariff rates on certain agricultural products, geographical indications, auto regulation and standards, and e-payments (National Retail Payments System).
  • There is misunderstanding in the trade press that talks are in such an advanced stage that a 90-day letter of intent to negotiate would be submitted to Congress soon. Vis-à-vis talks with EU, UK and Japan, talks with the Philippines are at an early stage. EU, UK and Japan talks have been more robust and much further along the process considering previous T-TIP and TPP negotiations.
  • A potential decision point could result from a USTR-DTI bilateral meeting that is still being planned during APEC.

The Council and members advocated policy issues and thanked USTR for the work done in the joint statement and for USTR’s continuing commitment to engage the Council and member US companies.

 
IN THIS UPDATE
 
 
Multilateral Trade Agreements
PHL, US eye ‘next steps’ towards free trade talks

National Affairs
Philippines slips in Doing Business rank | BusinessWorld
11th Foreign Investment Negative List bares ‘modest’ gains in easing restrictions | BusinessWorld
Leni Robredo’s trust rating remains ‘good’ — SWS | Philstar.com
Foreigner-hiring bill to require technology transfer, raise penalties | BusinessWorld
SWS: Duterte trust rating soars in
‘Duterte may appoint up to 5 chief justices’
Benigno Aquino III, Leni Robredo endorse opposition Senate 12 | Philstar.com
Employers warn of wage increase repercussions
DTI submits to Palace IRR on Ease of Doing Business Law

Customs
Duterte says military men to 'take over' Customs
At the Bureau of Customs: How Isidro Lapeña was outplayed
Duterte transfers Isidro Lapeña to TESDA
Philippines' Duterte sacks all top customs officials over drugs
Duterte 'promotes' Lapeña to TESDA; ex-AFP chief Guerrero to head Customs
Car importers post 13% lower sales | Philstar.com
Duterte places Customs under military control
Port congestion: what's the real score?

Defense & Security
Philippines outlines 34% defence budget increase | Jane's 360

Economics
[ANALYSIS] Ease of doing business: Why is the PH rank plummeting?
DOF sees Q3 GDP growth hitting 6.5%; Q2 now 6.2%
RFINL seen to further boost manufacturing sector–Neda
Philippines ranking falls in Ease of Doing Business
DTI seeks ITH period of 5 yrs in ‘Trabaho’ bill
SRA board member backs sugar planters’ call to freeze TRAIN law implementation
‘Pressure on peso to stay till year-end’
M&A, ‘greenfield’ FDI in PHL down in 2017

Energy
No signing seen on PHL-China oil exploration during Xi’s visit
Meralco raises November rates due to expensive natural gas
PSALM allots P22.66 million for IPP contracted capacity study
Philippines utility aims to become ‘major player’ in renewable energy
Philippines short-lists three company groups for LNG terminal project
China Ready to Produce Oil, Gas With Philippines in South China Sea – Minister
Revival of 620MW nuclear power plant gets support from Philippine officials
Philippines hopeful for South China Sea energy deal
Acciona to Invest in Renewable Energy & Infra Projects in Philippines
PH Rise seen as country’s hope for energy security
EU urges PH to tap available funding for innovative energy projects
Dennis Uy investing in PXP Energy
DBM: Fuel marking system on track for 2019
Diesel or solar: Could a push to power the Philippines turn greener?
Wind, Sun to Strand $60 Billion of Coal Assets in Southeast Asia

Financial Services
Peso-renminbi trading to cut business costs, spur flow of Chinese investments
Gov’t wants more clearing houses for digital deals

Food & Agriculture
PHL’s bid to import 203,000 MT of rice hits snag on TOR issues
DA chief and sugar farmers’ appeal to Senate: Don’t slash Sida budget
NFA issues int’l tender to buy 500,000 tons of rice
Mapping technology seen helping PCA improve tree count | BusinessWorld
Government urged to focus on main harvest areas

Health & Life Sciences
Red Cross inaugurates dialysis center
Filipinos face healthcare gaps
Pulse Asia: Majority of Filipinos to support bets who back higher tobacco taxes
Mobile app connects nurses and caregivers to patients
‘Health care to improve quality of life’

ICT
Consortium of Davao’s Dennis Uy, China Telecom declared 3rd telco
Converge ICT backs out of third telco bid
Honasan is next DICT chief; appointment paper out soon
LIST: Potential 3rd telco bidders
Villar firm, Converge ICT joining 3rd telco race
PH’s second microsatellite launched into space today
Philippines gets voting seat in international privacy body
DOF eyes e-invoicing system to make VAT refunds possible

Infrastructure
Ceza inks magnetic levitation train manufacturing agreement with two China companies
PHL, Japan sign Exchange of Notes for MRT-3 Rehabilitation Project  
Philippines, Japan sign loan deal for New Bohol Airport expansion | BusinessWorld
PHL, Japan to sign ODA deal for MRT rehabilitation in Nov. | BusinessWorld
Quezon City seeks Comparative Bids for its Integrated Solid Waste Management Facility PPP Project | PPP CenterPPP Center
PPA gets unsolicited offer for GenSan port
China, Japan not yet done competing for Philippines’ railways
IRC share sale seen to boost real estate, infrastructure business
Meralco unit, Korea partner to bring new rail technology to the Philippines

Insurance
BSP expands opportunities under UITFs

Legislation
‘Amend Timta to reveal list of firms with perks’
Aboitiz still interested in National ID program

Manufacturing
Oct. factory reading best in 10 months
Auto industry seen to post 1st annual drop in 7 years

Travel & Tourism
BI launches electronic facility gates in Cebu, Davao airports
Extend tax perks for tourism ecozones, Tieza asks Congress
Impose limits, hike cost of visiting Boracay–economists
Angara, Binay call for rehabilitation of other PH tourist spots
WTM 2018: South-east Asia bouncing back
 
ARTICLE CLIPS
 
 
Multilateral Trade Agreements

PHL, US eye ‘next steps’ towards free trade talks BusinessWorld 24th Oct 2018
MANILA and Washington announced on Tuesday gains in resolving “a number of recurring bilateral trade issues” amid their intention to start talks on a prospective free trade pact. The joint statement by Trade and Industry Secretary Ramon M. Lopez and US Trade Representative (USTR) Robert E. Lighthizer said the latest developments, under the 1989 Philippine-US Trade and Investment Framework Agreement (TIFA), follow Aug. 31 talks between Mr. Lopez and Deputy USTR Jeffrey D. Gerrish on the sidelines of the Association of Southeast Asian Nations Economic Ministers Meeting in Singapore.

National Affairs

Philippines slips in Doing Business rank | BusinessWorld Business World 6th Nov 2018
The Philippines managed to improve its score in the World Bank’s annual report that tracks economies’ competitiveness in ease of doing business, but its rank slipped as reforms to streamline transactions and strengthen stakeholder rights were offset by a drop in “getting credit” metrics, increased layers for import inspection and higher tax registration costs.

11th Foreign Investment Negative List bares ‘modest’ gains in easing restrictions | BusinessWorld Business World 6th Nov 2018
MALACAÑANG on Wednesday finally issued the government’s closely watched list of sectors in which foreign participation is regulated, showing sectors where restrictions have eased including teaching in “higher education levels.”

Leni Robredo’s trust rating remains ‘good’ — SWS | Philstar.com philstar.com 31st Oct 2018
Vice President Leni Robredo’s trust rating remained “good” in the third quarter of the year despite dropping by two percentage points, the Social Weather Stations (SWS) said in its recent survey.

Foreigner-hiring bill to require technology transfer, raise penalties | BusinessWorld Business World 29th Oct 2018
A bill strengthening the penalties for improperly employing foreign nationals and requiring them to transfer technology to Filipino employees has cleared the House Committee on Labor and Employment.

SWS: Duterte trust rating soars in philstar.com 28th Oct 2018
After suffering declines in the past two surveys, the trust rating of President Duterte rebounded by five points in the latest survey conducted by Social Weather Stations (SWS).

‘Duterte may appoint up to 5 chief justices’ philstar.com 26th Oct 2018
President Duterte may be able to appoint five chief justices during his six-year term in office. Sources in the administration revealed that the President intends to promote justices to the chief justice position upon their retirement as he respects the seniority tradition in the judiciary.

Benigno Aquino III, Leni Robredo endorse opposition Senate 12 | Philstar.com philstar.com 25th Oct 2018
Betting on their good and clean track record, Vice President Leni Robredo yesterday expressed confidence in the victory of candidates of the opposition coalition in the May 2019 senatorial elections.

Employers warn of wage increase repercussions BusinessWorld 25th Oct 2018
EMPLOYERS’ GROUPS argued before Metro Manila’s wage board in consultations on Wednesday that the hefty increase in daily minimum pay for private sector workers sought by labor groups would hit businesses — especially micro, small- and medium-scale enterprises — hard and will likely cause inflation to spike further. The National Capital Region Regional Tripartite Wages and Productivity Board held its consultation with the management sector on Wednesday, following the one with labor groups on Monday and ahead of tomorrow’s public hearing for all affected sectors. Representatives of almost 50 business groups and companies participated in the consultation.

DTI submits to Palace IRR on Ease of Doing Business Law Manila Bulletin Business 24th Oct 2018
The Implementing Rules and Regulations on the Ease of Doing Business and Efficient Government Service Act has been submitted to the Office of the President yesterday, according to Trade and Industry Secretary Ramon M. Lopez.

Customs

Duterte says military men to 'take over' Customs Rappler 29th Oct 2018
MANILA, Philippines – President Rodrigo Duterte said he will ask members of the Armed Forces of the Philippines (AFP) to take over the Bureau of Customs (BOC), amid the P11-billion shabu shipment controversy. The BOC is under fire because of the shabu worth P11 billion that allegedly slipped past security screenings. The existence of the shabu, which is the subject of congressional hearings, was previously contested by the BOC. But last Wednesday, October 24, then-BOC chief Isidro Lapeña conceded that empty magnetic lifters found in Cavite contained illegal drugs. Lapeña, on Thursday, October 25, was transferred to the Technical Education and Skills Development Authority. Former AFP chief Rey Guerrero is taking over the BOC. But Duterte has defended Lapeña and former commissioner Nicanor Faeldon, saying that the two were only tricked by insiders.

At the Bureau of Customs: How Isidro Lapeña was outplayed Rappler 28th Oct 2018
Former Bureau of Customs chief Isidro Lapeña’s changing answers to this simple question about the presence of shabu (methamphetamine) in magnetic lifters – brought into the country through the Manila International Container Port (MICP) – has added him to the fallen men of the bureau.

Duterte transfers Isidro Lapeña to TESDA philstar.com 26th Oct 2018
President Duterte has ordered the transfer of Customs Commissioner Isidro Lapeña to the Technical Education and Skills Development Authority (TESDA) as he implements a top-to-bottom revamp in the Bureau of Customs (BOC).  Duterte also directed former Armed Forces chief and Maritime Industry Authority (MARINA) administrator Rey Leonardo Guerrero to replace Lapeña.

Philippines' Duterte sacks all top customs officials over drugs The Star Online 25th Oct 2018
Philippine President Rodrigo Duterte fired the head of the Bureau of Customs on Thursday and ordered all top bureau officials replaced after the agency failed to intercept more than a tonne of drugs, the second such case in two years.

Duterte 'promotes' Lapeña to TESDA; ex-AFP chief Guerrero to head Customs Philippine Star 25th Oct 2018
President Rodrigo Duterte announced on that he would move embattled Customs Commissioner Isidro Lapeña to head the Technical Education and Skills Development Authority. Lapeña removal comes just a day after he acknowledged that magnetic lifters seized by the Philippine Drug Enforcement Agency in August may have contained at least P6.8 billion worth in methamphetamine hydrocholoride (shabu). Lapeña will be replaced at the BOC by former Armed Forces chief and current Marina Administration Administrator Leonardo Rey Guerrero, who was named to the post in April.

Car importers post 13% lower sales | Philstar.com philstar.com 24th Oct 2018
The Association of Vehicle Importers and Distributors Inc. (AVID) said its sales declined by 13 percent in the January to September period as rising inflation continued to dampen consumer demand for big-ticket items including vehicles.

Duterte places Customs under military control Philstar 30th Oct 2018
Exasperated by corruption and large-scale drug trafficking through the Bureau of Customs, President Duterte has directed the Armed Forces of the Philippines (AFP) to temporarily take over the BOC. Duterte also placed the entire BOC police on floating status and required its members to report to and hold office at the Malacañang gymnasium.

Port congestion: what's the real score? PortCalls Asia 24th Oct 2018
Is there port congestion at Manila’s international terminals? For the Philippine government, there is none, only a high level of terminal yard utilization. Stakeholders, however, are not inclined to believe this, pointing out that shipping lines are imposing port congestion-related surcharges (masquerading as “peak season surcharge”, according to some), and noting the long queue of trucks going inside the terminals.

Defense & Security

Philippines outlines 34% defence budget increase | Jane's 360 Jane's 360 24th Oct 2018
The 2019 budget for the Philippines’ Department of National Defense (DND) will increase to PHP183.4 billion (USD3.4 billion), the government’s Department of Budget and Management (DBM) announced on 24 October. The DBM said that the proposed expenditure “translates to a 34.4% increase over [the DND’s] 2018 cash-based equivalent budget of PHP136.5 billion”. It added, “Strengthening the Philippines’ defence posture is still on top of the reform priorities of the [President Rodrigo] Duterte administration.” In its statement the DBM said that the Philippine Army will receive PHP89 billion (or 48.5%) of the proposed 2019 defence budget, while the Philippine Air Force and the Philippine Navy will be allocated PHP24.6 billion (13.4%) and PHP27.8 billion (15.2%) respectively.

Economics

[ANALYSIS] Ease of doing business: Why is the PH rank plummeting? Rappler 8th Nov 2018
The report concerns the Philippines: from 113 this year, we dropped to rank 124 in 2019 – an 11-notch drop. The year before the Philippines also dropped by an even larger 14 notches. Hence, under President Rodrigo Duterte's watch, we've gone down the global Doing Business ranking by 25 notches all in all – by far the largest decline in ASEAN.

DOF sees Q3 GDP growth hitting 6.5%; Q2 now 6.2% BusinessMirror 8th Nov 2018
THE Department of Finance (DOF) sees the country’s gross domestic product (GDP) growth for the third quarter to hit 6.5 percent, due to growth in expenditures, among others. Based on a text message sent by Finance Secretary Carlos G. Dominguez III to reporters quoting Undersecretary Gil S. Beltran, the DOF expects the country’s GDP for the third quarter to hit 6.5 percent, higher than the 6 percent recorded in the second quarter and the 6.4 percent revised growth for the first half of the year.

RFINL seen to further boost manufacturing sector–Neda BusinessMirror 7th Nov 2018
The implementation of the recently approved 11th Regular Foreign Investment Negative List (RFINL) will further boost the performance of the manufacturing sector, according to the National Economic and Development Authority (Neda). The Neda also expects the manufacturing sector to sustain its positive growth in the remaining months of the year, supported by strong domestic demand, an optimistic business outlook, and accelerated public investments in infrastructure and social sectors.

Philippines ranking falls in Ease of Doing Business Philippine Star 2nd Nov 2018
The Philippines ranked lower in the World Bank’s Ease of Doing  Business Report 2019, placing 124th out of 190 countries from 113th previously, largely due to higher business registration costs and increased time for imports inspection.

DTI seeks ITH period of 5 yrs in ‘Trabaho’ bill BusinessMirror 29th Oct 2018
THE Department of Trade and Industry (DTI) has appealed for an extension—from three to five years—of the income tax holiday (ITH) under the Tax Reform for Attracting Better and High-quality Opportunities (Trabaho) bill, in order to keep the country’s fiscal regime on a par with Asian competitors.

SRA board member backs sugar planters’ call to freeze TRAIN law implementation BusinessMirror 26th Oct 2018
Sugar farmers and a member of the sugar board have thrown their support behind the proposed suspension of the additional excise tax on fuel under the second tranche of the Tax Reform for Acceleration and Inclusion (TRAIN) law to aid planters in coping with rising production costs and bring down the price of the sweetener in the market. Sugar Regulatory Administration (SRA) Board Member Emilio Yulo, who represents the planters sector, proposed that the suspension on the oil excise tax hike should be at least six months instead of the three-month reprieve.

‘Pressure on peso to stay till year-end’ BusinessMirror 24th Oct 2018
THE local currency has been seeing a reprieve in recent days, but may still be under pressure for the rest of the year. Data from the Bankers Association of the Philippines (BAP) showed the peso traded at 53.815 to a dollar on Tuesday, losing 2.5 centavos from the previous day’s trade of 53.79 to a dollar. The total traded volume was at $711.9 million, down from the previous day’s $863.4 million. After recent bouts of 12-year lows, the peso has been getting a reprieve since mid-October to trade within the 53 band in recent days.  ING Bank Manila economist Nicholas Antonio Mapa said the peso has been appreciating as corporate demand for the US dollars appears to have eased off in recent sessions, with the mid-month period usually where we note a substantial demand from big players. Importation ahead of the Christmas season may also be fading as the country enters the stretch run into the holidays, Mapa said.

M&A, ‘greenfield’ FDI in PHL down in 2017 BusinessMirror 24th Oct 2018
MERGERS and acquisitions (M&As) and “greenfield” foreign direct investments (FDI) in the Philippines declined in 2017, according to the Asian Development Bank (ADB). In the Asian Economic Integration Report 2018 (AEIR), the ADB said that, while this was the trend in Asia, the Philippines was among the most affected in the region. Data showed that investments —greenfield and M&As in the Philippines contracted 54.8 percent to $5.2 billion in 2017, from $11.6 billion in 2016. This contributed 3.2 percent to the total decline in the region.

Energy

No signing seen on PHL-China oil exploration during Xi’s visit BusinessMirror 8th Nov 2018
NO deals on joint exploration are expected to be signed during the visit of Chinese President Xi Jinping this month, two Cabinet members said on Wednesday, but did not rule out the possibility that discussions on the matter might at least be included later in the agenda. Malacanang had said in October the government is doing everything it can to make sure that when President Xi comes here, there will be a joint exploration deal that can be signed.  Cabinet members – the secretaries of energy and of foreign affairs — indicated otherwise, however. 

Meralco raises November rates due to expensive natural gas BusinessMirror 8th Nov 2018
ELECTRICITY rates this month will go up by P0.1135 per kilowatt- hour, bringing overall power rates of the Manila Electric Co. (Meralco) to P10.0901 per kWh. The increase comes after Meralco slashed power rates for two consecutive months. The reduction in September and October amounted to P0.25 per kWh. October power rates stood at P9.9766 per kWh. The P0.1135-per-kWh rate adjustment will mean an increase of around P23 in the total bill of a typical household consuming 200 kWh. Meralco said the slight upward adjustment was mainly due to higher WESM (Wholesale Electricity Spot Market) charges following an uptick in demand and an increase in Malampaya gas prices for the period.

PSALM allots P22.66 million for IPP contracted capacity study BusinessMirror 7th Nov 2018
The Power Sector Assets and Liabilities Management Corp. (PSALM) is soliciting bids for the conduct of a study on the contracted capacities with independent power producer (IPP) plants. With an outlay of P22.66 million, the study is provided in PSALM’s 2019 Corporate Operating Budget. The study will cover PSALM’s contracted capacities with IPP plants, namely: Caliraya-Botocan-Kalayaan Hydroelectric Power Plants, Mindanao Coal-Fired Thermal Power Plant, Casecnan Multi-Purpose Project, Unified Leyte Geothermal Power Plant and the Mindanao I and II Geothermal Power Plants. PSALM will evaluate the most beneficial and feasible privatization options and structures for its remaining IPP contracts through the assistance of a third-party consultant.

Philippines utility aims to become ‘major player’ in renewable energy PV Tech 1st Nov 2018
The Manila Electric Company (Meralco), the major utility of the Philippines, plans to set up 1GW of solar and wind projects in the medium term, according to the head of the firm's power generation unit.

Philippines short-lists three company groups for LNG terminal project Hellenic Shipping News 31st Oct 2018
The Philippines has short-listed three different groups to build and operate its first liquefied natural gas (LNG) import terminal and hopes to nominate one by November, its energy minister said on Tuesday.

China Ready to Produce Oil, Gas With Philippines in South China Sea – Minister Hellenic Shipping News 31st Oct 2018
China is ready to study the possibility of joint oil and gas production with the Philippines in the South China Sea, Chinese Foreign Minister Wang Yi said.

Revival of 620MW nuclear power plant gets support from Philippine officials Asian Power 31st Oct 2018
The Philippine Department of Finance (DOF) expressed support for the proposed revival of the cancelled Bataan Nuclear Power Plant (BNPP), citing the need to lower electricity costs in the country, local media report.

Philippines hopeful for South China Sea energy deal WorldOil 30th Oct 2018
Philippine Energy Secretary Alfonso Cusi is optimistic that a deal to jointly explore disputed areas of the South China Sea for oil and gas will finally move forward when President Xi Jinping visits next month.

Acciona to Invest in Renewable Energy & Infra Projects in Philippines OilVoice 30th Oct 2018
Acciona S.A., a Spanish infrastructure company, has reportedly announced the expansion of its operations in Philippines and plans to recruit more manpower as it looks for opportunities in the renewable energy sector in collaboration with a local company.

PH Rise seen as country’s hope for energy security Manila Bulletin 29th Oct 2018
The Senate Energy Committee sees the resource-rich Philippine Rise (Benham Rise) east of Aurora province as the country’s hope for energy security in the next decade.

EU urges PH to tap available funding for innovative energy projects Philippines News Agency 26th Oct 2018
The European Union's (EU) delegation to the Philippines urged local stakeholders to tap its available funding for sustainable and reliable energy projects.

Dennis Uy investing in PXP Energy Business World Online 26th Oct 2018
PXP ENERGY CORP. is raising P7.11 billion from the subscription of its shares by affiliate Philex Mining Corp., and a holding firm owned by businessman Dennis A. Uy.

DBM: Fuel marking system on track for 2019 BusinessMirror 25th Oct 2018
The Department of Budget and Management (DBM) has reported that it is ready to award the contract for the operation of the government’s planned fuel marking system before the end of this month, with the government looking to implement it starting 2019.

Diesel or solar: Could a push to power the Philippines turn greener? Straits Times 24th Oct 2018
In battling the timber poachers who roam the thick Sierra Madre forests near his home, Mr Larry Garaes has found a new ally: solar panels.

Wind, Sun to Strand $60 Billion of Coal Assets in Southeast Asia Bloomberg.com 29th Oct 2018
As much as $60 billion of coal power assets may be stranded in the next decade across Vietnam, Indonesia and the Philippines, according to a new study by Carbon Tracker, which cited tighter environmental policies and competition from cheaper renewable energy. That analysis is aimed to caution those contemplating new coal plants. The findings underscore how quickly advances in renewable energy are changing the power landscape. New wind and solar plants may become cheaper than coal in those countries, which are planning a combined $120 billion in coal investments, by the end of next decade. The analysis is also part of a growing type of advocacy that, instead of focusing on the dire outcomes of climate change, targets investors and financial institutions by forecasting economic risks.

Financial Services

Peso-renminbi trading to cut business costs, spur flow of Chinese investments BusinessMirror 31st Oct 2018
The direct foreign-exchange trading of the Chinese renminbi (RMB) and the Philippine peso will allow the country to corner a bigger share of China’s $120-billion overseas investments, according to the Department of Finance (DOF). On Tuesday Bank of China Manila and 13 other banks signed a memorandum of agreement (MOA) to create the Philippine Renminbi Trading Community (PRTC).

Gov’t wants more clearing houses for digital deals Philstar 24th Oct 2018
The Bangko Sentral ng Pilipinas is rushing the launch of more automated clearing houses (ACHs) particularly on government transactions as it aims to increase the level of cashless transactions to 20 percent by 2020 from the current level of about one percent. Vicente de Villa III, officer-in-charge of the central bank’s financial technology sub-sector (FTSS), said there is a need to launch more ACHs to meet the target of the National Retail Payment System (NRPS) to establish a safe, efficient, affordable, and reliable e-payments system.

Food & Agriculture

PHL’s bid to import 203,000 MT of rice hits snag on TOR issues BusinessMirror 7th Nov 2018
Manila’s 203,000-metric- ton (MT) rice tender on Tuesday failed after Bangkok and Hanoi opted not to participate in the government-to-government (G2G) bidding due to concerns over the approved importation guidelines. Notwithstanding this development, the National Food Authority (NFA) expressed confidence that the retail price of rice would remain stable and even go down further sans the arrival of the 203,000 MT. NFA Assistant Administrator Maria Mercedes G. Yacapin said the NFA has ample supply to sustain the volume of rice it sells in the market, which is currently pegged around 15 percent to 20 percent of the total market requirement.

DA chief and sugar farmers’ appeal to Senate: Don’t slash Sida budget BusinessMirror 7th Nov 2018
Agriculture Secretary Emmanuel F. Piñol and sugar planters are appealing to the Senate to scrap plans to slash the Sugar Industry Development Act (Sida) fund next year by 75 percent to P500 million from P2 billion this year. Piñol confirmed that the Sida fund of the Sugar Regulatory Administration (SRA) would be slashed by three-fourths due to underspending. The SRA is an attached government-owned and -controlled corporation of the Department of Agriculture (DA).

NFA issues int’l tender to buy 500,000 tons of rice Manila Bulletin News 3rd Nov 2018
The Philippines’ National Food Authority (NFA) issued an international tender to purchase up to 500,000 tons of rice, European traders said on Thursday. Tender offers will be opened on Nov. 20, they said.

Mapping technology seen helping PCA improve tree count | BusinessWorld Business World 30th Oct 2018
The Philippine Coconut Authority (PCA) is seeking to adopt mapping technology to improve its estimates of coconut production per region. “We’re trying to develop a proposal to be able to provide all the coconut farmers and producers, a map of the tree count in a given area to facilitate regional comparisons,” Department of Agriculture (DA) Minimum Access Volume (MAV) Secretariat Executive Director Clint D. Hassan said in an interview.

Government urged to focus on main harvest areas philstar.com 28th Oct 2018
The government must allocate more investments in major rice areas to ensure improved production and strengthen its competitiveness, former Agriculture Secretary William Dar said.

Health & Life Sciences

Red Cross inaugurates dialysis center Manila Times 7th Nov 2018
Sen. Richard Gordon led the inauguration on Tuesday of the Philippine Red Cross’ (PRC) first dialysis center in Port Area, Manila.

Filipinos face healthcare gaps Manila Standard Net 7th Nov 2018
Filipinos face a considerable financing gap as savings, current levels of insurance and government health provisions may not be enough to pay for the treatment of critical illnesses, a survey by AIA Group, Philam Life’s Hong Kong-based parent company, showed.

Pulse Asia: Majority of Filipinos to support bets who back higher tobacco taxes Manila Times 5th Nov 2018
MAJORITY of Filipinos will support candidates in next year’s election who will push for an increase in the tax on cigarettes, according to the latest Pulse Asia survey released on Monday.

Mobile app connects nurses and caregivers to patients Manila Standard 3rd Nov 2018
After a successful launch among nursing home facilities in New York City in 2017, SLF Management Systems Inc., together with Advanced World Solutions Inc., launched its first mobile app in the Philippines, BackApp—an around-the-clock staffing solution that connects healthcare facilities and professionals, home-based patients, and staffing agencies that need top-notch nurses and caregivers.

‘Health care to improve quality of life’ Manila Standard 31st Oct 2018
Palliative and end of life care services to patients with life-threatening diseases will soon be covered by Philhealth once the Universal Health Care bill is passed into law.

ICT

Consortium of Davao’s Dennis Uy, China Telecom declared 3rd telco BusinessMirror 8th Nov 2018
MISLATEL Consortium—the group led by Davao-based businessman Dennis A. Uy and state-owned China Telecom Corp. Ltd.—was declared as the provisional third telco player in the Philippines, after submitting the only compliant bid on Wednesday’s much-awaited selection process for the new major player in the local telco industry.

Converge ICT backs out of third telco bid ABS-CBN News 7th Nov 2018
Converge ICT and its partners, KT Corp and Teltech said Wednesday they decided not to bid for the Philippines' third telco slot. While the industry outlook is "financially viable," conditions for its participation are "commercially unviable," the 3 firms said in a joint statement. The prospective third telco is "required to incur an inordinate amount of funds and carry out commitments at a pace that is not required of the current dominant service providers," according to the statement.

Honasan is next DICT chief; appointment paper out soon Inquirer 5th Nov 2018
Senator Gringo Honasan is the next Secretary of the Department of Information and Communications Technology (DICT), Executive Secretary Salvador Medialdea confirmed on Monday.

LIST: Potential 3rd telco bidders Rappler 5th Nov 2018
The government aims to name this November the 3rd major telecommunications player and shake up the duopoly of Smart and Globe. The next player must commit to the Highest Committed Level of Service (HCLoS) specified in the Terms of Reference (TOR).

Villar firm, Converge ICT joining 3rd telco race The Inquirer 29th Oct 2018
The group of Converge ICT Solutions Inc., an aggressive fixed broadband service provider, and the Villar family’s Streamtech Systems Technologies acquired bid documents in the government’s third telco selection process.

PH’s second microsatellite launched into space today Manila Bulletin News 29th Oct 2018
The Philippines will launch today the DIWATA-2 microsatellite, marking the country’s third venture into space under the P840-million PHL-MICROSAT Program of the Department of Science and Technology (DOST).

Philippines gets voting seat in international privacy body BusinessMirror 26th Oct 2018
The Philippines has secured a seat in the five-member panel of the International Conference of Data Protection and Privacy Commission (ICDPPC), notwithstanding the country’s nascent status in data privacy regulation. The National Privacy Commission (NPC) said on Thursday that Manila clinched a voting seat in the Executive Committee of the ICDPPC. The commission is an international conference of 119 independent regulators from different countries exploring high-level proposals on data privacy and protection.

DOF eyes e-invoicing system to make VAT refunds possible BusinessMirror 24th Oct 2018
THE Department of Finance (DOF) is looking to establish an electronic invoicing system (e-invoicing) by 2020, which will allow for the implementation of a value-added tax (VAT) refund system for tourists visiting the country. During the Philippine Hotel Owners Association Inc. general membership meeting at the New World Hotel in Makati City on Tuesday, Finance Secretary Carlos G. Dominguez III told attendees, “Yes we will [set up a VAT refund scheme]; we don’t have the system at the moment, but we are certainly going to do it. And it should be in place some time in two years. There’s a possibility for us to outsource the system but our problem at the moment is we don’t have an e-invoicing system, which we are currently working on.”

Infrastructure

Ceza inks magnetic levitation train manufacturing agreement with two China companies BusinessMirror 8th Nov 2018
The Philippines may soon see its first manufacturing hub for magnetic levitation (maglev) trains, considered as the world’s fastest and most advanced commuter train, after the Cagayan Economic Zone Authority (Ceza) entered into an agreement with two Chinese firms to put up the facility. In a news statement issued on Wednesday, Ceza said it has signed a tripartite memorandum of understanding (MOU) with Eminova Asset Management Ltd. and Hunan Goke Maglev Technology Development Ltd. for the establishment of a research and development center for production and training in Santa Ana, Cagayan. The project, if it pushes through, will be the first in the country.

PHL, Japan sign Exchange of Notes for MRT-3 Rehabilitation Project   BusinessMirror 8th Nov 2018
The Department of Foreign Affairs (DFA) and the Embassy of Japan have signed the Exchange of Notes for the Metro Rail Transit 3 (MRT-3) Rehabilitation Project today, 07 November 2018. DFA Secretary Teodoro Locsin, Jr. and Ambassador of Japan to the Philippines Koji Haneda signed the Exchange of Notes, which was witnessed by Department of Transportation (DOTr) Undersecretary for Railways Timothy John Batan along with officials from the DFA, DOF, the Embassy of Japan, and JICA.

Philippines, Japan sign loan deal for New Bohol Airport expansion | BusinessWorld Business World 6th Nov 2018
The Philippine and Japanese governments signed on Monday the supplemental loan agreement for the ongoing New Bohol Airport expansion project on Panglao Island.

PHL, Japan to sign ODA deal for MRT rehabilitation in Nov. | BusinessWorld Business World 29th Oct 2018
THE Department of Transportation (DoTr) on Sunday said it is ready to sign an agreement with the Japanese government for the use of official development assistance (ODA) to fund the rehabilitation of the Metro Rail Transit Line 3 (MRT-3) following the initial roll out of new trains. In a statement, the DoTr said it deployed on Saturday the first of 48 light rail vehicles (LRVs) procured from Chinese company CRRC Dalian Co. in 2014. It noted the other LRVs are still undergoing assessment and validation before being deployed. After adding the new trains, next for the MRT-3 is the entry of a new maintenance provider and the P22.061-billion loan from Japan for its rehabilitation.

Quezon City seeks Comparative Bids for its Integrated Solid Waste Management Facility PPP Project | PPP CenterPPP Center Public-Private Partnership Center PH 25th Oct 2018
The local government unit of Quezon City (“QC LGU”) is currently inviting interested parties to submit comparative proposals for the City’s Integrated Solid Waste Management Facility PPP Project. The Project is being undertaken as an incorporated joint venture, pursuant to QC LGU’s Ordinance No. SP 2336, series of 2014, entitled “Quezon City Code Pursuing a Public-Private Partnership (PPP) Approach Towards Development, Providing for the Procedure for Selecting the Private Sector Proponent, Adopting a Contract Management Framework, and Providing Appropriations and For Other Purposes”, and its Implementing Rules and Regulations (“QC PPP Code”).

PPA gets unsolicited offer for GenSan port Phil Star Global 5th Nov 2018
The Philippine Ports Authority (PPA) has received another unsolicited proposal from the private sector to rehabilitate and upgrade one of the country’s ports following a recent unsolicited offer from Dennis Uy’s Chelsea Logistics Holdings Corp. to modernize the Sasa port in Davao City. The modernization of the Sasa port was part of the PPP program by the previous administration, but was scrapped. As far as the PPA is concerned, Santiago said the agency would only be entertaining unsolicited proposals for ports classified as Tiers 1 and 2.

China, Japan not yet done competing for Philippines’ railways Phil Star Global 31st Oct 2018
The rivalry between China and Japan over who will become the Philippines’ master builder of railways is far from over. President Rodrigo Duterte plans to spend trillions of peso to bridge the Philippines’ infrastructure gap, which policymakers have qualified as a reason why one of the region’s fastest-growing economies had lagged behind its Southeast Asian peers for so long.

IRC share sale seen to boost real estate, infrastructure business Phil Star Global 31st Oct 2018
IRC Properties Inc. expects to boost its real estate and infrastructure businesses using proceeds from its recent share sale. Proceeds from the share issuance would be used for real estate development and capital for infrastructure projects, IRC said in a disclosure yesterday.

Meralco unit, Korea partner to bring new rail technology to the Philippines Phil Star Global 30th Oct 2018
MRAIL Inc., a subsidiary of power distribution giant Manila Electric Co., is teaming up with Seoul Metro to bring the latest technology to the country’s railway system.The B2S replaces ballast tracks with concrete slab tracks which, according to MRAIL, is proven to enhance safety and minimize rail defects.The system is also expected to increase the service cycle of rails which will lead to improved passenger experience.

Insurance

BSP expands opportunities under UITFs BusinessWorld 25th Oct 2018
THE CENTRAL BANK is expanding opportunities under unit investment trust funds (UITFs) by allowing placements in government-issued debt papers. Bangko Sentral ng Pilipinas (BSP) Deputy Governor Chuchi G. Fonacier said the Monetary Board has approved more options for UITFs to further entice investors with low risk tolerance. “In order to maximize participation of the trust industry in the said issuance of the BTr (Bureau of the Treasury), the Bangko Sentral has expanded the allowable investments of conservative money market UITFs to include securities issued by the national government,” Ms. Fonacier told reporters.

Legislation

‘Amend Timta to reveal list of firms with perks’ BusinessMirror 26th Oct 2018
THE Department of Finance (DOF) is again urging Congress to amend the Tax Incentives Management and Transparency Act (Timta) so the government can make public the list of corporations that receive tax incentives. The DOF said that its proposal to “introduce improvements” to the Timta, or Republic Act 10708, is part of government efforts to make “fairer, targeted, more accountable and transparent the current system of corporate taxation.” Finance Undersecretary Karl Kendrick T. Chua said in a statement that when the government gives an incentive to one group, another group pays for it in the form of higher taxes. Thus, those who pay higher taxes to compensate for incentives should have the right to know who is benefiting from their hard-earned money.

Aboitiz still interested in National ID program BusinessWorld 25th Oct 2018
THE Aboitiz group said it remains interested in taking part in the National Identification (ID) system, despite the Philippine Statistics Authority’s (PSA) rejection of its unsolicited proposal earlier this month. “We are very interested in the National ID program, we will have to check when the terms of reference are released, to see if it makes sense for us to participate,” Aboitiz InfraCapital, Inc. (AIC) Vice- President Jose Emmanuel P. Reverente said in an interview on the sidelines of the Philippines Investment Forum in Makati last week. The PSA said earlier this month that it will opt for a competitive bidding for the Philippine identification system, which will help the government manage the timeline for procuring and awarding the system by year end.

Manufacturing

Oct. factory reading best in 10 months Business World 6th Nov 2018
FACTORY ACTIVITY in the Philippines saw the biggest improvement in 10 months in October, keeping the country in the lead in Southeast Asia, according to the latest survey which IHS Markit conducted for Nikkei, Inc. that cited “a sharp rise in demand for manufactured goods.” The Nikkei Philippines Manufacturing Purchasing Managers’ Index (PMI) rose to 54 in October from 52 in September, reflecting “solid improvement in the health of the sector.” The Philippines remained at the helm of the seven Association of Southeast Asian Nations (ASEAN) members tracked by IHS Markit’s regional survey for the second straight month. Vietnam and Indonesia followed with 53.9 and 50.5 readings, respectively, and were the only other two Southeast Asian economies that improved from September.

Auto industry seen to post 1st annual drop in 7 years BusinessWorld 25th Oct 2018
VEHICLE sales are expected to drop by 10-15% for the full year, as demand continues to be dampened by higher excise taxes, soaring inflation, and rising fuel prices. “This year, down lahat. The market itself… We project 10% to 15% down,” Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) President Rommel R. Gutierrez told reporters on the sidelines of the 7th Philippine International Motor Show in Pasay City on Wednesday. If realized, this would mark the first decline in full-year vehicle sales in seven years. Data jointly from CAMPI and Truck Manufacturers Association (TMA) showed the groups’ member companies sold 425,673 vehicles in 2017, an 18.4% increase from 359,572 units in 2016. The domestic auto industry had recorded annual double-digit growth since 2012.

Travel & Tourism

BI launches electronic facility gates in Cebu, Davao airports Manila Bulletin News 2nd Nov 2018
The Bureau of Immigration (BI) has launched its electronic gate facility (E-Gate) scheme for Filipino travelers arriving in the airports of Cebu and Davao.

Extend tax perks for tourism ecozones, Tieza asks Congress BusinessMirror 31st Oct 2018
The Tourism Infrastructure and Enterprise Zone Authority (Tieza), the infrastructure arm of the Department of Tourism (DOT), has proposed amendments to the Tourism Act of 2009 in Congress to head off the expiry of tax incentives extended to locators in tourism economic zones (TEZs).

Impose limits, hike cost of visiting Boracay–economists BusinessMirror 29th Oct 2018
INTERVENTIONS, such as increasing the cost of visiting Boracay and limiting the number of tourists in the island, will prevent its degradation, according to local economists and an official of the National Economic and Development Authority (Neda). University of Asia and the Pacific (UA&P) School of Economics Dean Cid Terosa noted that governments in other parts of the world have already imposed limits on tourist destinations and have adopted a pro-environment tourism strategy.

Angara, Binay call for rehabilitation of other PH tourist spots The Inquirer 26th Oct 2018
Senators Sonny Angara and Nancy Binay on Friday urged the government to revitalise other tourist spots in the country, now that Boracay island was re-opened to visitors six months after its rehabilitation.

WTM 2018: South-east Asia bouncing back TTG 5th Nov 2018
Overall things are looking rosy for south-east Asia – the World Travel & Tourism Council forecasts the region to rank third for growth in 2018