| National Affairs
Congress votes overwhelmingly for one year of martial law philstar.com 14th Dec 2017
As expected, the administration-dominated Senate and House of Representatives overwhelmingly approved yesterday President Duterte’s request to extend martial law in Mindanao by one year. As contained in Joint Resolution No. 13, martial rule is extended from Jan. 1 to Dec. 31, 2018. This is the second extension of the President’s martial law declaration in May, with the first ending at the end of this month. The resolution also extended by one year the suspension of the privilege of the writ of habeas corpus, which authorizes state forces to conduct warrantless arrests. Lawmakers voted 240-27 to approve the joint resolution. Fourteen senators voted yes, while four opposed it. In the House, 226 members supported the measure, while 23 voted against. The two chambers voted jointly on martial law issues.
Duterte says nationwide martial law is 'on the table' philstar.com 13th Dec 2017
President Rodrigo Duterte on Wednesday said that "all options are on the table" regarding the possible placement of the entire Philippines under martial law, just hours after Congress acceded to his request to extend military rule in Mindanao for another year. Duterte said he was not discounting the possibility of a nationwide martial law if the existence of the republic was already threatened by lawless elements, rebels and militants. "At this time? All options are on the table. All options are on the table. There's only one rationale there: the existence of the Republic of the Philippines," the president said in a media briefing following the destruction of arms used in the siege of Marawi City which prompted the chief executive to place Mindanao under military rule. The president's pronouncement came just after Congress, dominated by his allies, overwhelmingly voted to extend military rule in Mindanao for another year or until Dec. 31, 2018.
1st package of tax reform bill now up for Duterte's signature Rappler 13th Dec 2017
The Senate and the House of Representatives on Wednesday, December 13, ratified the bicameral conference committee report on the Tax Reform for Acceleration and Inclusion (TRAIN) bill, seeking to cut income taxes but adding levy on fuel, cars, mining, coal, and tobacco. The bill will now be sent to President Rodrigo Duterte for signing into law. Once signed, the measure is set to be implemented by January 1, 2018. The bicam agreed to increase the excise tax on coal from P10 to P50 for 2018, P100 for 2019, and P150 for 2020. As for income taxes, lawmakers agreed to exempt from tax the first P250,000 annual income of Filipinos, whether compensation earners or self-employed, to increase their take-home pay starting January 1, 2018. This means those earning around P21,000 a month would no longer need to pay income taxes. To compensate for the loss of revenue, Congress decided to increase taxes on fuels such as gasoline, diesel, and liquefied petroleum gas (LPG), among others. This means higher prices for such commodities. Legislators also agreed to impose a tax of P6 per liter on drinks using sugar and artificial sweeteners and P12 on drinks using high fructose corn syrup. Milk and instant coffee are exempted.
Congress ratifies P3.767-trillion national budget for 2018 Rappler 13th Dec 2017
A few days before going on a month-long break, Congress on Tuesday, December 12, ratified the P3.767-trillion national budget for 2018, after a little over two weeks of bicameral discussions. During their respective sessions, the Senate and the House panels ratified the budget early Tuesday evening, following adjustments and compromises from both chambers. The proposed General Appropriations Act (GAA) was approved by the bicameral conference committee the same day. Among the most contentious provisions in the budget was the difference between the Department of Public Works and Highways (DPWH) budget of the Senate and the House. Senator Panfilo Lacson initially had more than P50 billion slashed from the DPWH budget, citing right-of-way issues. Legislators from both chambers opposed this. The bicameral conference committee also agreed to scrap the P500 million originally intended for the government's Masa Masid program, the anti-drug campaign of the Department of the Interior and Local Government. The P900 million originally intended for Oplan Double Barrel, or the war on drugs of the Philippine National Police (PNP), was scrapped and reallocated for the housing of police and soldiers, as earlier proposed by Senate Minority Leader Franklin Drilon.
DOF lists priority legislative bills for 2018 philstar.com 11th Dec 2017
The Department of Finance (DOF) said it intends to support three legislative measures for immediate approval in Congress next year. In an interview, Finance Secretary Carlos Dominguez III cited three priority bills which the DOF would push for approval in the Congress in 2018, including the second package of the tax reform bill, the tariffication of rice and the provision of a national identification card. “We told them (Congress) that we will be really focusing on Package 2 (of the Comprehensive Tax Reform Program or CTRP) which is lowering CIT (corporate income tax) together with reviewing of fiscal incentives,” Dominguez told reporters. According to earlier reports, key features of the second tax reform bill will include the reduction of corporate income tax rates to 28 percent by 2019 and 25 percent by 2021 from the current 30 percent, and the rationalization of fiscal incentives being enjoyed by certain business sectors. Dominguez said his department will also support a bill on the imposition of tariff on imported rice. Lastly, Dominguez said the finance department will also call for the approval of a bill seeking the provision of a national ID system.
Gov’t readies 2nd tax reform package Inquirer.net 11th Dec 2017
The Department of Finance early next year will seek Congress’ speedy approval of a number of tax measures, including the second reform package that will cut corporate income taxes as well as review the sin tax regime. Finance Secretary Carlos Dominguez III told reporters last week that the DOF would focus on pushing for the second package of Tax Reform for Acceleration and Inclusion (Train) Act, which he said was “almost ready.” The second of five tax reform packages will cover corporate income taxation, whose draft bill will be submitted to Congress next year following the release of the results of the cost-benefit analysis of investors’ tax perks under the Tax Incentives Management and Transparency Act (Timta). The second tax reform package will bring down the corporate income tax rate from 30 percent at present to 28 percent in 2019 and 25 percent in 2021, similar to the rates in neighboring countries. Fiscal incentives will be rationalized under the second package such that only those that were performance-based, time bound, targeted and transparent will be granted to investors. As for existing tax incentives, a sunset provision of a maximum of five years will be put in place. Also, the government will replace the 5-percent gross income tax to a reduced corporate income tax rate of 15 percent under the second package.
House Con-ass okay for Charter change likely by January–lawmaker BusinessMirror 4th Dec 2017
The chairman of the House Committee on Constitutional Amendments on Monday said lawmakers are set to approve a resolution calling Congress to constitute itself as a constituent assembly (Con-ass) to discuss proposed revisions to the 1987 Constitution by January 2018. Committee chairman and Rep. Roger Mercado of Southern Leyte said his panel has completed a report of House Concurrent Resolution 9 that consolidated several measures providing con-ass as a mode for charter change. “I am confident House Concurrent Resolution [HCR] 9 can be expedited and be ready by or before January 2018. The House is therefore able to back up Speaker Pantaleon D. Alvarez when he meets [with] Senate President Aquilino Pimentel III,” Mercado said. Earlier, Alvarez said Congress may convene into a Con-ass early next year to craft a new Constitution that would enable the country to shift to a federal form of government.
No need for revolutionary government, Palace says BusinessMirror 30th Nov 2017
With President Duterte’s open declaration that he has no plans of declaring a revolutionary government, Malacañang on Thursday told administration critics to try again and look for another issue to dangle against the Chief Executive. In a phone interview, Presidential Spokesman Harry L. Roque Jr. said the President is nowhere near declaring a revolutionary government, and that the opposition should hold its horses on trying to force the issue. “While it is true that there are some of the President’s allies who want a revolutionary government, he appreciates the suggestion, but he has repeatedly said there is no basis and there is no need for a revolutionary government,” Roque said. “There is no need for a revolutionary government…and I think it’s the last issue that the opposition can use against the President,” Roque added.
Customs
Free trade talks take back seat to societal issues in PH Asia Customs & Trade 10th Dec 2017
Discussions on free trade in the Philippines have “taken a back seat” as the Duterte administration has shifted government focus to addressing the ills of society, according to a Philippine trade expert. Dr. Thomas Aquino, former undersecretary of the Department of Trade and Industry, claimed during the Asia-Pacific Forum 2017 on Integration and Inclusiveness in a Digital Society that the current administration is prioritizing issues that confront the Philippine leadership, such as the integration of the Philippine society through new legislation and the challenges facing Mindanao, while pushing the free trade agenda to the back seat. This is manifested in the country’s stand on bilateral relationships, which according to Aquino, has already gravitated toward basic issues, such as respect for sovereignty and other domestic priorities. The trade expert expressed disappointment at how the President handled himself during the 31st Association of Southeast Asian Nations (ASEAN) Summit held in the country recently, where “very little came out from him with respect to, not just regional, not just bilateral but also on any international issues.”
Customs asked to probe data gap with China Inquirer.net 7th Dec 2017
Finance Secretary Carlos G. Dominguez III has ordered the Bureau of Customs to immediately double-check trade figures with its Chinese counterpart to get to the bottom of possible technical smuggling of goods from and to China, which deprives the government of billions of pesos in tax revenues. In a statement Wednesday, the Department of Finance said Dominguez had asked Customs Commissioner Isidro S. Lapeña to meet with his counterpart in the Chinese government right away to check the narrowing but still significant gap between that country’s registered export volumes to the Philippines and import figures officially reported here. “Official trade data show that the estimated discrepancy between registered Chinese exports to the Philippines and registered Philippine imports from China has been declining but still very large, with the gap reported at 60 percent in 2010, 57 percent in 2015, 48.7 percent in 2016 and 48 percent in the January-July period of this year,” Dominguez explained. As such, Dominguez said he had asked Lapeña “to invite his Chinese counterpart to sit down and review the data.”
42 draft orders on PH Customs act issued so far Asia Customs & Trade 4th Dec 2017
The implementing rules and regulations (IRR) of the Customs Modernization and Tariff Act (CMTA) will be contained in about 42 customs administrative orders (CAOs) that the government plans to complete by 2018, according to the Philippine Department of Finance (DOF). Finance Undersecretary Antonette Tionko, who heads DOF’s Revenue Operations Group, said that 42 draft CAOs have already been posted on the CMTA microsite www.dof.gov.ph/cmta_irr, with eight already signed. She said some CAOs may end up being consolidated or being broken down into separate customs administrative or memorandum orders.
Defense & Security
Philippines Military Modernization Gets Delayed Boost With Attack Aircraft Deal The Diplomat 5th Dec 2017
Last week, Philippine officials confirmed that the defense department had finally awarded Brazilian aircraft manufacturer Embraer a key, longstanding contract to supply its air force with new close air support aircraft. The development marks some much-needed progress by the Southeast Asian state in a key item for its air force modernization after repeated delays.
US-Philippines Coast Guard Cooperation in the Spotlight with Coast Watch Center Visit The Diplomat 12th Dec 2017
This week, a key coast guard facility in the Philippines was in the headlines due to the visit of a U.S. coast guard official. The interaction put the spotlight on a facility that continues to play an important role within wider U.S.-Philippine defense cooperation in the maritime security space as the two treaty allies continue to build out their ties under Presidents Rodrigo Duterte and Donald Trump.
PNP to thwart NPA attempts to expand terrorist activities BusinessMirror 10th Dec 2017
The Philippine National Police (PNP) is beefing up its internal security operations by intensifying its intelligence works against the New People’s Army (NPA), which has threatened to carry more attacks against the government after President Duterte declared it as a terrorist group, along with its political arm, the Communist Party of the Philippines (CPP). PNP Spokesman Chief Supt. Dionardo Carlos said last Sunday the intensified intelligence operations is part of the police’s proactive efforts in thwarting attempts by the rebels to expand their “terrorist activities” in the countryside. The President, through Presidential Proclamation 374, has declared the NPA and the CPP as terrorist organizations.
What’s With the New Philippines-Cambodia Military Pact? The Diplomat 8th Dec 2017
This week, the Philippine and Cambodian governments announced that they had concluded a new defense pact following the second iteration of a joint commission set up to advance bilateral cooperation. Though details are still quite sparse, the development nonetheless highlighted the ongoing collaboration between the two countries since President Rodrigo Duterte came to power last year. Though the historical ties between the Philippines and Cambodia stretch back centuries, the formal establishment of contemporary ties began in 1957 and continued despite the turbulence that the Vietnam War and the rise and fall of the Khmer Rouge generated. While agreements had been signed on various issues in the post-Cold War period, the countries more recently decided to set up a Joint Commission for Bilateral Consultations (JCBC), which would be a forum for both sides to review past agreements and undertake new areas of cooperation as well.
Singapore-Philippines Urban Warfare Training Kicks Off The Diplomat 5th Dec 2017
On Monday, Singapore announced that a new program to help build Philippine military expertise in urban warfare had officially kicked off. The launch of the initiative, first announced as part of the city-state’s assistance to Manila to combat the terror threat posed by the Islamic State and its affiliates, is yet another manifestation of ongoing indigenous efforts among Southeast Asian states to build regional capacity on this front.
NDF calls for more frequent attacks philstar.com 1st Dec 2017
Communist rebels warned yesterday of “more frequent and more intensified attacks” against the government once President Duterte formally tags the Communist Party of the Philippines (CPP) and its armed wing the New People’s Army (NPA) as terrorist groups. The National Democratic Front (NDF), the umbrella organization representing the CPP-NPA in peace negotiations with the government, threatened to wage war if Duterte continues to ignore the peace efforts and officially classifies the rebels as terrorists. Duterte on Wednesday said he has ordered security forces to shoot communist rebels bearing firearms. He revealed an executive order is being prepared to declare the NPA as a terrorist group.
AFP: Maute remnants regrouping in Lanao Philippine Daily Inquirer 30th Nov 2017
The top aide of slain terror leader Omarkhayam Maute has reportedly been recruiting residents, especially young men, in Lanao del Sur province as the Maute terror group tries to rebuild its forces after its defeat following a five-month battle in this provincial capital, a military official said. Col. Romeo Brawner Jr., deputy commander of the military’s Joint Task Force Ranao, said one Abu Dar was among the Maute group’s “second line” leaders who escaped the war and was now trying to reorganize the Islamic State (IS)-inspired group that laid siege to Marawi on May 23. “The [reported] recruitment efforts for training of new fighters of IS-Maute terrorist group were monitored in the towns of Piagapo, Lumbacaunayan and Sultan Domalondong,” said Brawner, noting that he received the information from locals. He said Abu Dar, who carried a P3-million bounty on his head, had been using images of Marawi’s devastation to win recruits.
Economics
ADB upgrades Philippine GDP growth forecast for 2017, 2018 Rappler 13th Dec 2017
The Asian Development Bank (ADB) upgraded its growth outlook for the country for 2017 and 2018, as the government's massive infrastructure drive finally started to take hold. The ADB upgraded its 2017 and 2018 gross domestic product (GDP) forecast for the Philippines to 6.7% and 6.8%, respectively, from the previous 6.5% and 6.7%. The new estimates were given in a supplement to the ADB's Asian Development Outlook 2017 report released on Wednesday, December 13. This outlook, the ADB said in the report, "assumes that growth in the government's infrastructure program will accelerate, supported by improvements in budget execution, with more large investment projects underway." The Philippine economy has picked up steam of late, expanding by 6.7% in the first 3 quarters of 2017 on accelerating investment and robust consumption. The ADB's rosier projections for the Philippines mirror the growth forecast for Southeast Asia as a whole, which was upgraded to 5.2% for both 2017 and 2018 from 5.0% and 5.1% last September.
Trade deficit widens 28% in October philstar.com 13th Dec 2017
The balance of trade swung to a higher 28 percent deficit in October as imports continued to outpace exports, the Philippine Statistics Authority (PSA) reported. Based on data from the PSA, total external trade in goods grew by 10.4 percent in October to $13.58 billion, from $12.30 billion registered in the previous year. Total imports increased 13.1 percent to $8.21 billion from $7.26 billion the previous year while total exports rose by a slower 6.6 percent to $5.37 billion from $5.04 billion last year. This, however, marked the 11th consecutive month of positive growth in exports. Thus, the trade deficit amounted to $2.84 billion in October 2017, higher than the $2.22 billion deficit in October 2016. “We are encouraged by the performance of Philippine trade in recent months, especially with the consistent positive performance of exports. Cooperation and trade initiatives are integral to sustaining these gains,” Socioeconomic Planning Secretary Ernesto Pernia said. “For 2018, we are looking at improved performances in exports of agricultural products and semiconductors, which continue to comprise a huge portion of Philippine exports,” he said.
FDIs steady year to date as September flows surge BusinessWorld 12th Dec 2017
FOREIGN DIRECT INVESTMENTS (FDI) to the Philippines surged in September amid sustained optimism from offshore investors, with both intercompany lending and equity capital picking up from a year ago, the Bangko Sentral ng Pilipinas (BSP) reported yesterday. Net FDI jumped 61.8% to $754 million that month from the $466-million inflow in September 2016, although it was 37.3% less than August’s $1.203-billion tally.
Poll: Monetary policy stable as year ends BusinessWorld 11th Dec 2017
THE CENTRAL BANK will likely maintain policy settings when it meets on Thursday as inflation and liquidity remain manageable, notwithstanding mounting pressure from a US rate hike — the third this year — that is widely expected the day before, according to a BusinessWorld poll late last week. Twelve economists asked on their expectations said the Monetary Board of the Bangko Sentral ng Pilipinas (BSP) will keep policy stance unchanged on Thursday — its eighth and final policy review for 2017 — which immediately follows the rate-setting meeting of the US Federal Reserve’s Federal Open Market Committee.
PSEi trending toward 9,000 in 2018 and 10,000 in 2019 BusinessMirror 11th Dec 2017
BDO-Nomura Securities, an online brokerage firm, said the benchmark Philippine Stock Exchange index (PSEi) may breach the 9,000-point level next year and possibly hit the 10,000-point milestone by 2019, as corporate earnings continue to drive growth. BDO-Nomura Securities research head Dante Tinga Jr. said the 30-company PSEi may settle at around 8,300 at the end of this year and grow by 13.9 percent to 9,100 in 2018. This will further grow by 13 percent to about 10,280 by 2019.
‘Fitch upgrade good for infrastructure push’ BusinessMirror 11th Dec 2017
The decision of Fitch Ratings to raise the Philippines’s sovereign rating by one level bodes well for the private sector and for the government’s massive infrastructure program, according to the National Economic and Development Authority (Neda). Socioeconomic Planning Secretary Ernesto M. Pernia told the BusinessMirror that the credit upgrade would allow the government to obtain cheaper loans to finance its “Build, Build, Build” program. “The [upgrade] is a welcome development, especially at a time that we are seeing a sustained improvement in government spending. The upgraded rating reflects the steady and strong economic performance of the Philippines and the firm confidence of investors,” Pernia said in a statement.
Food prices drag Nov. inflation lower BusinessWorld 6th Dec 2017
LOWER food prices caused inflation to ease in November after four straight months of picking up, the government said yesterday.The Philippine Statistics Authority (PSA) said headline inflation slowed to 3.3% last month from October’s 3.5% but was still faster than the 2.5% clocked in November last year.
Gov’t launches data bank to cut red tape Inquirer.net 5th Dec 2017
The government on Monday launched the “Philippine Business Data Bank” that will let businesses apply for and renew permits in a shorter period of time. The Department of Finance said the digital platform, which will allow online sharing of information across several government agencies, was rolled out together with the departments of Information and Communication Technology (DICT) as well as the Interior and Local Government (DILG). The system will also include the participation of the Department of Trade and Industry, the Securities and Exchange Commission, economic zones, as well as more than 1,600 local government units. “The launching of the Philippine Business Data Bank system is among the initiatives of the DOF as lead agency of the government’s anti-red tape program to improve the ease of doing business in the country,” Finance Undersecretary and anti-red tape czar Gil S. Beltran said in a statement. “With the Philippine Business Data Bank, government agencies can readily access data on a particular business, eliminating the need for business owners to bring numerous documentary requirements when transacting with the government,” Beltran explained. In particular, the data bank will allow agencies to verify the existence of a business entity using a single reference document, the DOF said.
High oil, power prices to accelerate inflation BusinessMirror 5th Dec 2017
Filipinos could pay more for consumer goods next year due to the increase in the price of crude oil, local economists and the National Economic and Development Authority (Neda) said on Tuesday. Socioeconomic Planning Secretary Ernesto M. Pernia said production cuts that would be implemented by members of the Organization of the Petroleum Exporting Countries (Opec) in 2018 would hike the price of imported crude oil.
Philippine investment boom leaves neighbors in the dust BusinessWorld 30th Nov 2017
CAPITAL INVESTMENT in the Philippines is surging past the rest of Southeast Asia as the government and firms ramp up spending. In the first nine months of this year, net physical assets in the Philippines grew by 10.4% from a year earlier. That compared with a 6.9% increase in Malaysia and 5.8% gain in Indonesia, according to data from statistics offices. There’s reason to remain bullish on the outlook. Philippine government spending jumped by 28% in October, the largest rise in almost a year, with another record budget planned for 2018. President Rodrigo R. Duterte is building a network of railroads and highways across the archipelago in an ambitious $180-billion infrastructure program. Investment firing up adds another engine to the economy, headed for a sixth year of growth exceeding six percent and among the world’s best performers. Mr. Duterte wants to transform the Philippines into an upper-middle income country by the end of his term in 2022, and the cornerstone of his vision is a plan referred to as “Build, Build, Build.” It includes the capital’s first subway and a 653-kilometer railway to the south.
Energy
PNOC mulls bidding for $2-B LNG terminal philstar.com 12th Dec 2017
State-run Philippine National Oil Co. (PNOC) may opt to bid out the development of a $2-billion liquefied natural gas (LNG) terminal if no qualified proposals make it by the Dec. 31 deadline, its top official said yesterday. PNOC president Ruben Lista said the company’s technical working group (TWG) handling the unsolicited proposals for the LNG project has rejected the first two offers from Korea Electric Power Corp. (Kepco) and the consortium of Lloyds Energy Group and Itochu Corp. However, he said these companies could still re-submit their proposals while other firms are still welcome to make offers until Dec. 31. PNOC has also told China National Offshore Oil Co. (CNOOC) to submit its proposal, which was first sent to the Department of Energy (DOE), Lista said. “If there are no companies that can qualify for the requirements by Dec. 31, we will have to bid out the project and it will no longer be an unsolicited process,” Lista said. PNOC is in talks with the Asian Development Bank (ADB) to become its consultant for the planned LNG project. PNOC was tasked to put up an integrated LNG hub with storage, liquefaction, regassification and distribution facility, as well as a reserve initial power plant capacity of 200 megawatts (MW). Energy Secretary Alfonso Cusi earlier said the LNG hub is expected to start construction next year, aiming to become an LNG hub for Asia, complementing those in Japan and Singapore.
House concludes probe on Meralco power deals BusinessMirror 12th Dec 2017
Members of the House Joint Committee on Good Government and Public Accountability and on Energy on Monday have decided to conclude their investigation on the alleged “midnight deals” between Manila Electric Co. (Meralco) and the Energy Regulatory Commission (ERC) after six hearings. For Bayan Muna Party-list Rep. Carlos Zarate, whose House Resolution (HR) No.566 initiated the investigation, the hearings have already established the ERC clearly favored the power supply agreements affiliated with Meralco. Zarate said it’s no wonder consumer groups are protesting because there seems to be a selective application of the rules in favor of accommodation. Zarate said the ERC kept on extending the deadline to accommodate the Meralco PSAs. Meralco has denied having midnight deals with the ERC, noting that its 7 bilateral power contracts that were probed by the House panel have yet to be approved by regulators. The House Joint Committee hopes to come up with a report on the recently-concluded hearings in the coming weeks.
Electricity open access scheme participation made voluntary Inquirer.net 11th Dec 2017
The Department of Energy has issued two circulars that are seen to bring forward the development of open access in the electricity retail business by allowing qualified consumers to voluntarily choose their suppliers instead of being mandated to break ties with incumbent players. The DOE had earlier pushed for a mandatory approach to the Retail Competition and Open Access (RCOA) scheme, which hit a snag after the Supreme Court issued a temporary restraining order on this policy. Under the RCOA scheme, power consumers with an average monthly peak demand of at least one megawatt would be able to choose alternative suppliers—thus, they are called contestable customers. This threshold will then be lowered progressively up to the point that the scheme can be done at the level of each household or individual consumer.
DOE to declare $2 B LNG terminal as project of nat’l significance philstar.com 11th Dec 2017
The Department of Energy (DOE) is declaring the planned $2-billion liquefied natural gas (LNG) terminal part of the lineup of projects of national significance under Executive Order 30. DOE Secretary Alfonso Cusi said the agency is preparing a list of power projects that will be under EO 30 as long as these developments have a high social impact. The energy chief said one project to be declared under EO 30 is the LNG hub. EO 30 provides that government agencies concerned with energy projects should presume other agencies were able to act upon and issue their respective permits within a 30-day period. It created the Energy Investment Coordinating Council, to be led by the DOE, which will spearhead and coordinate national government efforts to harmonize, integrate and streamline regulatory processes, requirements and forms relevant to the development of energy investments in the country. Placing the project under EO 30 will allow the LNG terminal to start construction within 2018. The DOE has tasked its corporate arm Philippine National Oil Co. (PNOC) to spearhead the development of the country’s integrated LNG hub, consisting of five million metric tons per annum of storage, liquefaction, regassification and distribution facility, as well as a reserve initial power plant capacity of 200 megawatts (MW). PNOC is currently evaluating unsolicited proposals from three foreign investors, namely Korea Electric Power Corp. (KEPCO), Lloyds Energy Group and China National Offshore Oil Co. (CNOOC).
DOE wants to stop ‘bote-bote’ gas sale philstar.com 10th Dec 2017
The Department of Energy (DOE) has issued new policies on the sale of adulterated gasoline and diesel to tricycles to allow faster development of gas stations in the countryside. The new policies under the downstream oil industry are intended to further protect consumers by enticing industry players to provide better services and product, DOE Secretary Alfonso Cusi said. Cusi said the “bote-bote” system or sale of gas and diesel on soda bottles opens end-users to the purchase of adulterated fuel and exposes the public to the dangers of fire and explosion. Cusi said the DOE drafted and endorsed to the Department of Trade and Industries-Bureau of Product Standards the new Philippine National Standard (PNS) for automotive and industrial diesel products in compliance with the standard specification under the Philippine Clean Air Act.
Gov’t may retain FIT for hydro, biomass Inquirer.net 9th Dec 2017
The government is still considering restoring support for hydro and biomass electricity generation projects but definitely terminating preferential treatment for other platforms like solar and wind, Energy Secretary Alfonso Cusi said. Cusi said in an Energy Investment Forum at the Makati Shangri-La on Thursday that prices now were much lower compared to the previously approved feed-in tariff (FIT) rate of about P10 per kilowatt-hour. The FIT was designed to provide priority dispatch for renewable energy sources, with the intention of encouraging investments in solar, wind, hydro and biomass. The assumption was that the dispatch of renewable energy would result in lower costs for consumers. But Cusi said power generated from these technologies now cost as low as P3 per kwh compared to the FIT rate of P9.68 kwh that was first offered in 2012 to solar installation investors.
Economic officials to approve fuel marking system Inquirer.net 6th Dec 2017
Economic managers are set to approve the implementation of the fuel marking system as part of the first tax reform package expected to be approved by Congress and signed by President Duterte before the end of the year. The National Economic and Development Authority’s (Neda) Investment Coordination Committee-Cabinet Committee (ICC CabCom) will tackle today the fuel marking program, which is part of the first package of the Tax Reform for Acceleration and Inclusion (Train), whose approved Lower House and Senate versions are currently undergoing consolidation. The government this month will start the procurement process for the fuel marking system to be implemented in the second half of 2018. Department of Finance and Bureau of Customs officials have said that the fuel marking program would generate P20 billion in additional revenues for the government as well as combat oil smuggling.
Financial Services
Insurers post 22% income gain in Q3 philstar.com 13th Dec 2017
The local insurance industry continued to expand as players recorded a total net income of P27.86 billion in the third quarter, 21.88 percent up from P22.85 billion in the same period last year, the Insurance Commission (IC) reported yesterday. Insurance commissioner Dennis Funa attributed the increase mainly to the rise in the underwriting and investment income of the life insurance sector, which more than offset the decline in the performance of the non-life insurance sector. “While the non-life insurance sector experienced a 20.87 percent decline in total net income for the third quarter from P3.49 billion to P2.76 billion, the life insurance sector showed a strong performance in the penultimate quarter of this year, with a total net income of P21.96 billion up by 31.93 percent compared to the same period last year,” Funa said. The microinsurance sector, which is accounted mainly by the mutual benefit associations, also posted a 15.19-percent increase in net income to P3.13 billion from P2.72 billion, Funa said.
PLDT targets 30 million users of e-payments platform philstar.com 9th Dec 2017
Voyager Innovations Inc., the digital innovations arm of PLDT Inc., is aiming to have 30 million users for its products which include digital payments app PayMaya and mobile wallet Smart Money by 2020. “Since we launched PayMaya, our target across Voyager is always for 2020 to be a banner year. When we started in 2015, five years later, we’re expected to have about 30 million users across all of Voyager,” Paolo Azzola, PayMaya chief operating officer and managing director told reporters yesterday. At present, he said there are eight million users of PayMaya and Smart Money. To get to the 30 million target by 2020, Azzola said the plan is to encourage more people to use their platforms.
Central bank eyes rules for coin offerings as Bitcoin use surges BusinessWorld 6th Dec 2017
THE PHILIPPINES is looking at regulating so-called initial coin offerings (ICOs), as the use of cryptocurrencies gains ground in the country. Bangko Sentral ng Pilipinas (BSP) Governor Nestor A. Espenilla, Jr. said the central bank is in talks with the Securities and Exchange Commission (SEC) on ways to oversee ICOs, in which companies raise funds through the sale of digital tokens.
Telcos and banks battle over Philippines cashless payments Nikkei Asian Review 6th Dec 2017
Banks and telecom companies are taking advantage of Filipinos' growing use of digital payments. Our third-quarter survey showed respondents who used debit and credit cards as well as cash outnumbered those who use only cash. Among respondents, 39 per cent used debit cards in the previous three months and 34 per cent used credit cards. Just 31 per cent used only cash. Filipinos don't only use cashless transaction to pay bills; online shopping was cited as the most common reason (see chart).
How digitization is changing the insurance landscape in Asia Pacific, Philippines philstar.com 6th Dec 2017
As one of the oldest industries in the world, insurance is also one of the most traditional, especially with the advent of agents selling bonds, claims, premiums and quotes, among other products. But a 100-year-old, global insurance company believes that insurance must change with the modern times. Even it must go digital.
Banks favor gradual cut in reserve requirement philstar.com 1st Dec 2017
Major players in the country’s banking industry said the plan to gradually lower the level of deposits that banks are required to maintain with the central bank would help sustain the strong economic expansion.
Food & Agriculture
FAO calls for more food investments in Mindanao philstar.com 14th Dec 2017
The Food and Agriculture Organization of the United Nations (FAO) is calling for increased investments in the country, particularly in Mindanao, to address food security, rural development, resilience-building and peace in the area. As the organization celebrates its 40th year in the country, FAO representative in the Philippines Jose Luis Fernandez said global hunger is on the rise again after a decade-long steady decline. Fernandez said investments in the systems that address the most basic needs of people should remain a priority. “We cannot solve poverty, hunger, lack of education, ensure good health for all, achieve lasting peace and build sustainable cities when access to food and livelihoods, especially in rural areas, are not fully addressed,” he said. Over the past 40 years, FAO has implemented more than 400 national projects in the Philippines, reaching over 500,000 farming and fishing families or over 2.5 million people. FAO continues to focus on strengthening the country’s food and nutrition security, increasing the sustainability and competitiveness of agricultural production, including fisheries and forestry.
Philippines may soon import cattle from Latin America philstar.com 13th Dec 2017
The Philippines inched closer to its plan to bring in cattle from Latin American nations after the World Organization for Animal Health (OIE) laid down guidelines that will allow the country to import the breeding materials. Agriculture Secretary Emmanuel Piñol said OIE has a set of protocols which would allow the Philippines to bring in cattle from Brazil and Argentina without compromising its foot-and-mouth disease (FMD) free without vaccination status. Piñol said he met with OIE director for the Americas Jose Osvaldo Barcos and OIE Southeast Asia representative Ronel Avila on the sidelines of the ongoing World Trade Organization Ministerial Conference in Buenos Aires and received a favorable response to the country’s plan to import.
Halal accreditation to help Phl achieve growth target philstar.com 11th Dec 2017
The Philippines will be able to easily hit its economic growth targets over the medium term if it succeeds in penetrating the trillion-dollar global halal market. In a report, International Halal Accreditation Forum (IHAF) secretary general Mohammed Saleh Badri said the country could easily accomplish the growth targets set in the Philippine Development Plan 2017-2022 and the Philippine Export Development Plan 2018-2022 once it is able to get a bigger slice of the global halal market. Badri said the halal industry is a new but fast-growing industry currently worth $2 trillion. It is forecast to expand to $3.8 trillion by 2022. The Philippines last week gained membership to the IHAF, a development seen to further spur the local halal industry by strengthening trade between the Philippines and other member countries. The IHAF is an independent and non-government network of accreditation entities mandated to enforce halal standards in their respective countries and regions. He said IHAF at present is offering to assist the government to set up a halal certification system so that local enterprises will not have to get certification from abroad.
2017 milled-rice output seen rising to 12.78 MMT BusinessMirror 11th Dec 2017
The country’s milled-rice production this year could settle at 12.78 million metric tons (MMT), 5.35 percent higher than the 12.13 MMT recorded output last year, according to the latest forecast of the United Nations’s Food Agriculture Organization (FAO). Through its marketing outlook arm Agricultural Market Information System (Amis), the FAO hiked its projection for Philippine milled-rice production this year by 1.614 percent, or by 203,000 MT, from its earlier forecast of 12.577 MMT.
Phl seeks continued access to high seas tuna fishing ground PhilStar 4th Dec 2017
The Philippines is seeking extended fishing access to tuna-rich high seas pocket 1 of the Pacific Ocean in the next five years from the Western and Central Pacific Fisheries Commission (WCPFC) to ensure continued economic fishing activities. Agriculture Undersecretary and Bureau of Fisheries and Aquatic Resources national director Eduardo Gongona said the country is negotiating for the access to the high seas pocket 1 which is set to expire this year. “We are negotiating continued access to high seas pocket 1 and the current terms and conditions of the existing WCPFC conservation and management measures on tropical tunas,” Gongona said in a briefing for the 14th Regular Session of the WCPFC on Sunday in Pasay City.
PH needs fisheries department, aquaculture experts say Philippine Daily Inquirer 30th Nov 2017
The government needs to create a Department of Fisheries in order to improve fish production for domestic consumption and for export, leading aquaculture experts said here on Tuesday. Rafael Guerrero, the scientist who developed the sex reversal technology used in culturing all-male tilapia, said the country trailed behind China, Indonesia and other Asian countries in the production of tilapia, bangus (milkfish) and seaweeds. Guerrero, who was honored along with another scientist by the National Integrated Fisheries Technology Development Center here, said the creation of a fisheries department would also enable the country to take care of its waters. The country’s fishery sector is currently administered by the Bureau of Fisheries and Aquatic Resources (BFAR), which is under the Department of Agriculture.
Health & Life Sciences
House OKs bill on HIV/AIDS policy PhilStar 4th Dec 2017
The House of Representatives has approved on third and final reading the bill seeking to strengthen the fight against human immunodeficiency virus and acquired immune deficiency syndrome in the country. Voting 188-0, members of the House unanimously approved House Bill 6617 or the "Philippine HIV and AIDS Policy Act." The proposed measure seeks to deliver treatment, care and support services to persons living with HIV in accordance with approaches upholding principles of human rights, gender-responsiveness and age-appropriateness.
DOH to probe possible Dengvaxia overpricing Inquirer.net 13th Dec 2017
The Department of Health (DOH) will look into the reason why the government bought the now-controversial vaccine, Dengvaxia, for P1,000 per dose instead of P600, Health Secretary Francisco III said on Wednesday. This after lawmakers during the House committee on good government and public accountability on the botched dengue immunization program found that the cost-effectiveness study commissioned by Sanofi Pasteur recommended the vaccine to be bought for $21 or P1,000.
Ubial on anti-dengue vaccine drive: I wanted to stop it, but was warned Inquirer News 11th Dec 2017
Former Health Secretary Paulyn Rosell-Ubial said some lawmakers has warned that she could go to jail if she would stop the implementation of the P3.5 billion anti-dengue vaccination program during her term. “It is very difficult for me to implement this, I want to stop that, but people in Congress said I will go to jail if we stop it because there’s already a contract,” Ubial said during the joint hearing of the Senate blue ribbon, health, and finance committees on Monday.
Philippines to probe dengue vaccine scare BBC News 4th Dec 2017
The Philippines has launched an investigation into the immunisation of 730,000 children with a dengue vaccine that could pose health risks. Last week French drug company Sanofi announced its vaccine could worsen the potentially deadly disease in people not previously infected. The public immunisation programme was suspended on Friday. Dengue fever affects more than 400 million people each year around the world.
ICT
Lazada, other foreign companies, dominate Philippine e-commerce battle e27 5th Dec 2017
From small and medium enterprises (SMEs) to giant corporations, the Philippines’ retail sector is rapidly shifting to e-commerce to broaden their consumer base despite the country’s famous ‘mall culture’. The Philippine e-commerce has the lowest sales-share for e-commerce sales share in Southeast Asia, but it is showing potential with its growing internet and smartphone penetration rate, a rising middle class and young population.
Firms need to protect consumers against cybercrime Inquirer 2nd Dec 2017
Most Filipino consumers who transact online want businesses to do more to protect them against cybercrime, according to a survey by Limelight Networks, a United States-based content delivery provider.
DICT hopeful on deal with NGCP, TransCo for use of fiber optic cable philstar.com 11th Dec 2017
The Department of Information and Communications Technology (DICT) is hopeful it could sign the memorandum of agreement (MOA) with the National Grid Corp. of the Philippines (NGCP) and National Transmission Corp. (TransCo) for the use of their fiber optic cable network to deliver services in far-flung areas not served by telcos before Christmas. “We hope that this could be done before Christmas,” DICT officer-in-charge Eliseo Rio Jr. said in a text message. He said the MOA is being finalized by the NGCP and TransCo. He said the signing of the MOA with the NGCP or TransCo for DICT to use their fiber optic cable as the main backbone for the Domestic Wideband Information Network, which includes the government’s backbone and middle network, is among the items the agency wants to accomplish within the year. Talks with the NGCP for a MOA for the possible use of their fiber optic cable network to implement the National Broadband Plan (NBP) started under former DICT secretary Rodolfo Salalima. The NBP was approved by President Duterte last March.
China Telecom named 3rd main telco player philstar.com 11th Dec 2017
The Presidential Communications Operations Office (PCOO) yesterday identified the Chinese firm that would become the third player in the country’s telecommunication industry. PCOO Secretary Martin Andanar said China Telecom would invest in the Philippines and this development would improve internet service in the country. “The Chinese government has selected a company that will invest in the telco (industry) of our country. It is China Telecom, the largest telecommunications company in China,” Andanar said over dzBB. Last month, Duterte asked China to invest in the Philippines’ telecommunication industry, believing it would improve internet speed in the country. The Philippine leader issued the invitation during a meeting with Chinese Premier Li Keqiang. Presidential spokesman Harry Roque has said the entry of a Chinese investor would break the “duopoly” in the telecommunication industry, whose players are PLDT Inc. and Globe Telecom. Andanar said China Telecom has to find a local partner since the Constitution limits foreign ownership of a public utility to 40 percent.
Renewed interest in IT-BPM sector seen philstar.com 8th Dec 2017
Legislative measures being put in place have helped spark renewed investment interest in the country’s IT and business process management (IT-BPM) sector, the IT-Business Process Association of the Philippines (IBPAP) said. In a statement, IBPAP president and CEO Rey Untal lauded lawmakers’ efforts in recognizing the IT-BPM industry’s vital role in the economy, as well as “the need to retain incentives that enable us to maintain our global competitiveness as an outsourcing destination.” Untal said sustaining and enhancing current fiscal incentives are key to the country’s ability to attract and retain foreign investors and locators, which in turn are essential to job creation and revenue generation.
PH Strengthens Extraterritorial Reach through the APEC Cross Border Privacy Enforcement Arrangement National Privacy Commission 5th Dec 2017
The Philippines has joined the APEC Cross Border Privacy Enforcement Arrangement (CPEA), the government backstop enforcement network developed for the Cross-Border Privacy Rules (CBPR). It is an initiative that facilitates information sharing among privacy enforcement authorities in APEC economies, provide mechanisms to promote effective cross-border privacy cooperation, and encourage information sharing and cooperation with authorities outside APEC. Administrators of the CPEA on Thursday confirmed the NPC’s status as a Privacy Enforcement Authority (PEA) for the Philippines, becoming the eleventh PEA along with those from eight other APEC economies namely, Australia, Canada, Hong Kong, Japan, Republic of Korea, New Zealand, US, Mexico. Privacy Commissioner and Chairman Raymund Enriquez Liboro on Tuesday said that as a next step, the NPC is convening local stakeholders to build consensus around formally joining the APEC CBPR.
Infrastructure
5 bidders for Clark Airport project advance to next stage philstar.com 11th Dec 2017
Five of the seven firms which submitted bid documents for the design, engineering and construction of the new passenger terminal building of Clark Airport have advanced to the next stage of the tender. The Department of Transportation (DOTr) and the Bases Conversion and Development Authority (BCDA) said the five firms, which are eligible for the opening, evaluation and deliberation of the technical proposals for the Clark International Airport expansion project are China State Construction Engineering Corp. Ltd., China Harbour Engineering Co. Ltd., Sinohydro Corp. Ltd., Megawide-GMR Consortium, and the consortium of Tokwing Construction Corp. and China Machinery Engineering Corp. The agencies are targeting to award the engineering procurement construction contract for the Clark Airport’s passenger terminal building on Dec.15. Meanwhile, the groundbreaking ceremony for the Clark International Airport new terminal building is slated to be held on Dec. 20. The P12.5 billion project is expected to be completed in 2020. It involves the construction of a new passenger terminal building which could accommodate eight million passengers per annum. Once completed, Clark airport’s total capacity would increase to 12 million passengers per year from the current four million. In addition, the project covers construction and installation of all required landside and airside facilities to support the operations of the new terminal.
Emergency powers to tackle traffic pushed Inquirer.net 7th Dec 2017
The Joint Foreign Chambers (JFC) in the Philippines urged Congress to pass a final bill that would give President Duterte emergency powers to manage the urban traffic crisis, which has gone worse due to the “worsening congestion we experience daily during this Christmas” season. The coalition of various foreign business chambers in the country wanted President Duterte to certify the legislation as “urgent” in order to speed up the rather slow pace in the legislative mill. There are a number of traffic crisis bills filed in both the House of Representatives and the Senate. When asked if they supported a specific bill, John Forbes, a senior adviser of the American Chamber of Commerce of the Philippines (AmCham), said that they would back the final bill that would recognize both road and air traffic congestion.
Gov’t infra spending up 11.8% in first 10 months Inquirer.net 7th Dec 2017
The amount spent by the government on infrastructure rose 17.8 percent year-on-year to P51.5 billion in October as more public works projects were rolled out that month. The latest Department of Budget and Management data showed that disbursements for infrastructure and other capital outlays at the start of the fourth quarter increased from P43.7 billion in October last year. However, infrastructure expenditures that month were lower than September’s P53.6 billion. The DBM attributed the year-on-year increase in infrastructure spending in October to the Department of Public Works and Highways’ projects such as road repair, upgrading and widening as well as flood control and rehabilitation or improvement of dike systems, and the Department of the Interior and Local Government-Philippine National Police’s acquisition of transport and other equipment under its capability enhancement program. Also, the DBM said the higher infrastructure expenditures were partly due to payment for various communication, navigational and air traffic management system projects, as well as consultancy and civil works for the Light Rail Transit Lines 1 and 2 extension projects of the Department of Transportation.
ADB earmarks half of assistance for infrastructure development BusinessWorld 6th Dec 2017
THE Asian Development Bank (ADB) has set aside fresh funds for Philippine loans over the next three years, with infrastructure accounting for nearly half of the pie, the Finance department said in a press release on Tuesday.
DPWH partners with Uber for seamless travel in Metro Manila | BusinessMirror BusinessMirror 5th Dec 2017
The riding public can now have a seamless and efficient carpool experience as Uber joins forces with the Department of Public Works and Highways (DPWH). Public Works Secretary Mark A. Villar sealed on Tuesday the agreement with Uber Country Manager Laurence Cua through a memorandum of understanding signing event at the Operations Room of the DPWH Building. Villar acknowledged the importance of the Uber app in the promotion of ridesharing and carpooling, which can aid in traffic decongestion along the major thoroughfares in Metro Manila. “This is one major step toward finding a solution to the increasing vehicle volume in our roads. With the help of Uber, we will be able to have better decision-making process when it comes to traffic patterns, solutions and rerouting schemes,” Villar said.
Manufacturing
Vehicle sales rise 17% in 11 months philstar.com 14th Dec 2017
Philippine automotive sales maintained its speed in November, fueling a robust double-digit acceleration in 11 months to remain on track in finishing the year on a high note. In a report released yesterday by the Chamber of Automotive Manufacturers of the Philippines Inc. (CAMPI) and the Truck Manufacturers Association (TMA), vehicle sales in November posted a 23.8 percent increase to 40,799 units from 32,966 units in the same month last year. "November sales result is higher than the month of October because of increased sales of major assemblers and distributors," CAMPI president Rommel Gutierrez said. For the 11-month period ending November, combined vehicle sales of CAMPI and TMA members reached 380,179 units or 16.8 percent higher compared to 325,468 units in the same month last year. CAMPI and TMA have set a full year target of 400,000 unit sales this 2017.
Manufacturing growth slows to 6% in October philstar.com 13th Dec 2017
The country’s manufacturing output declined in October, driven by a slowdown in chemical production, the Philippine Statistics Authority(PSA) reported yesterday. Based on the PSA’s Monthly Integrated Survey of Selected Industries (MISSI), the Volume of Production Index (VoPI) for manufacturing declined to 6.5 percent in October 2017, down from the 9.9 percent growth recorded in the same month last year. “Chemical products contributed significantly to the decrease at 61 percent,” the PSA said. Other major sectors that also posted two-digit declines in VoPI are tobacco products (-39.4 percent), textiles (-28.3 percent), footwear and wearing apparel (-27.5 percent) and paper and paper products(-18.9 percent). The Value of Production Index (VaPI) likewise decreased to 6.3 percent.
Car firms brace for impact of auto excise tax philstar.com 11th Dec 2017
Car companies are bracing for the impact of the proposed excise tax on automotive vehicles on their sales next year, saying they expect a significant drop as soon as its implementation starts. The industry, however, is hoping to make one big run this December, a month before the higher prices take effect. “The last month before the excise tax implementation, we’re hoping that there would be a significant spike and then we expect a big drop in January,” Isuzu Philippines Corp. marketing head Joseph Bautista said. Bautista said the entire Philippine automotive industry is on track to meeting its yearend target sales of 450,000 units. Car prices are expected to jack up substantially starting next year with the implementation of higher excise tax on new vehicles as part of the government’s tax reform program.
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