ECCP at Work

Duterte signs law providing protection to consumers

President Rodrigo Duterte has signed into law a measure providing consumers more protection against fraud in availing of financial products and services. A copy of Republic Act No. 11765 or the Financial Products and Services Consumer Protection Act, signed by Duterte on May 6, was sent to reporters Tuesday. “It is the policy of the State to ensure that appropriate mechanisms are in place to protect the interest of consumers of financial products and services under the conditions of transparency, fair and sound market conduct, and fair, reasonable, and effective handling of financial consumer disputes, which are aligned with global best practices,” the measure states

NCR still under Alert Level 1; Some provinces remain under Alert Level 2 — IATF

Metro Manila and several other provinces and towns will still be under Alert Level 1 of the COVID-19 alert classification system, while other areas will remain under Alert Level 2 according to acting Presidential spokesperson Secretary Martin Andanar.

Philippines faces headwinds despite strong Q1 GDP

The Philippines may have recorded a stronger-than-expected first quarter performance, but headwinds remain that would likely impact growth in the near term. In its weekly economic preview, New York-based intelligence firm S&P Global said Asia-Pacific economies, including the Philippines, are still facing a combination of challenges to their recovery. In the Philippines, S&P Global Market Intelligence chief economist for Asia-Pacific Rajiv Biswas said both manufacturing input and output price inflation remain elevated.

Omicron subvariant BA.2.12.1 now in NCR, Puerto Princesa

A subvariant of the highly transmissible COVID-19 Omicron variant, identified as BA.2.12.1, has been detected in the National Capital Region and in Puerto Princesa, Palawan, according to the Department of Health (DOH). During the briefing last May 13, Health Undersecretary Maria Rosario Vergeire made the announcement, saying that two fully-vaccinated and boosted individuals in Metro Manila got the subvariant.

Comelec to proclaim Magic 12 Wednesday

The Commission on Elections (Comelec) plans to proclaim the top 12 candidates in the senatorial race, or the so-called Magic 12, by Wednesday and some of the winning party-list groups by Thursday. The proclamation date was set during an executive session by all seven commissioners on Sunday night, the sixth day of the official canvassing of votes at the Philippine International Convention Center.

PSEi lost 5.6% in a week

The benchmark Philippine Stock Exchange Index (PSEi) plunged over 150 points on Friday, extending losses in the postelection period as investors weighed the cloudy economic outlook and await plans of presumptive president elect Ferdinand “Bongbong” Marcos Jr. By the closing bell, the PSEi fell 2.34 percent, or 153.13 points, to 6,379.17 even as most regional indices on Friday bounced higher ahead of the weekend, data showed. The broader all-shares index was lower by 1.7 percent, or 59.81 points, to 3,457.40.

‘PHL to import more rice as output to stay flat’

The Philippines could retain its status as the world’s second largest buyer of rice for the fourth consecutive year in 2023, when total import volume is projected to reach 3 million metric tons (MMT). In its monthly global grain report, the United States Department of Agriculture (USDA) said the Philippines’s rice imports this year and next year would hit the 3-MMT level. This is the first trade projection made by the USDA for calendar year 2023. The agency said China, which is expected to purchase 6 MMT, will remain as the world’s top buyer of rice.

DOF: Tarrification slashed prices of rice by P7/kg

Implementation of the Rice Tariffication Law (RTL) has slashed prices of the country’s staple food to the current average of P39 per kilogram or a reduction of about P7 per kg, from its cost in 2018 when it peaked to a per-kilo retail cost of around P46, the Department of Finance (DOF) said. President Duterte signed the RTL into law on February 14, 2019, as Republic Act No. 11203. The law, which later took effect on March 5, 2019, replaced rice import quantitative restrictions with tariffs.

Gasoline, diesel at all-time highs

Aside from high food prices, consumers are most affected by oil prices. Last week, Brent crude oil dropped slightly by $ 1.30 to settle at $ 111.09 per barrel. Although down from the March highs following Russia’s invasion of Ukraine, oil prices remain above $ 100 per barrel. The spike in oil prices impacts net oil-importing countries like the Philippines. Investors watch prices of energy closely since it affects many aspects of the economy, such as GDP, inflation, exchange rate, current account, and balance of payments.

GDP growth to remain at 6.5% in 2022 – Citi

American banking giant Citi is still expecting some downside risks from higher commodity costs and global slowdown despite the stronger-than-expected 8.3 percent gross domestic product (GDP) growth in the first quarter of the year. Nalin Chutchotitham, economist for the Philippines at Citi, is maintaining its GDP growth forecast at 6.5 percent this year, lower than the seven to nine percent target penned by economic managers. “Q1 GDP rose 8.3 percent year-on-year, exceeding market expectations, supported mainly by greater reopening. We maintain 2022 GDP forecast at 6.5 percent, as some downside risks remain from higher commodity costs and global slowdown,” Chutchotitham said.

BSP seen raising interest rates this week

More economists expect the interest rate liftoff by the Bangko Sentral ng Pilipinas (BSP) to kick off this week after the economy delivered a solid gross domestic product (GDP) growth performance in the first quarter. ANZ Research chief economist Sanjay Mathur and economist Debalika Sarkar said policy normalization in the Philippines may start on May 19, with a possible rate hike of 25 basis points as the BSP takes into consideration the evolving growth-inflation dynamics. “This will be followed by similar hikes in each of the five remaining meetings, taking the policy rate to 3.50 percent by yearend,’’ the economists said.

Ex-NEDA chief warns of fiscal crisis

The next administration, whose fiscal space will be restricted by a swelling budget deficit and national debt, could face a fiscal crisis and may have to return to public-private partnerships (PPPs) to complete big-ticket projects. In an interview with The STAR, former socioeconomic planning secretary Ernesto Pernia said the incoming administration of Ferdinand Marcos Jr. should woo the private sector to take part in the infrastructure program through PPP agreements to fill in the funding gap. “Infrastructure spending will be severely constrained and the PPP modality will be the only way out,” Pernia, who used to serve as an economic manager in the Duterte administration, said. The national debt has spiked by 18 percent to a record P12.68 trillion as of March from P10.77 trillion a year ago on double-digit increases in both onshore and offshore borrowings.

OFW remittances hit $8.65 billion in Q1

Remittances from overseas Filipino workers (OFWs) sustained their growth in March, expanding by more than two percent in the first quarter, and remained a bright spot for the Philippine economy, according to the Bangko Sentral ng Pilipinas (BSP). Personal remittances improved by 2.3 percent to $8.65 billion in the first quarter from $8.45 billion in the same quarter last year. For March alone, personal remittances – computed as the sum of net compensation of employees, personal transfers, and capital transfers between households – grew by 3.1 percent to $2.89 billion from $2.8 billion in the same month last year. 

PH economy rises above expectations with 8.3% Q1 growth

The Philippine economy maintained its growth momentum in the first three months of 2022 as it expanded by 8.3%, Philippine Statistics Authority figures released Thursday showed. The latest expansion outpaces the 3.8% contraction from January to March last year and 7.8% pace logged in the last quarter of 2021. The economy grew 1.9% quarter-on-quarter in seasonally adjusted terms. The first-quarter figure is also faster than the 6.58% average forecast among 15 economists polled by CNN Philippines. Apart from base effects, analysts cited factors like efforts to further reopen the economy — with the Omicron-driven surge in COVID-19 cases in January but a quick setback — along with election spending.

DERAILS JOB CREATION EFFORTS: Micro firms take a hit from wage hike

The Employers Confederation of the Philippines (ECOP), joining calls for the exemption of micro enterprises (MEs) from the increase in minimum wage, expressed concern over the impact of such adjustment to the government’s job creation efforts. Sergio Ortiz-Luis, ECOP president, said half of MEs have been shut down by the pandemic and have yet to reopen due to the uncertainties. “With the additional expenses, these micro enterprises may no longer reopen and those which are planning to expand may no longer pursue their plans,” Ortiz-Luis said. The National Productivity and Wages Commission said the wage order exempts barangay micro-enterprise businesses (BMBEs), or those with total assets of not more than P3 million. The regional wage boards in the National Capital Region and Region 6 (Western Visayas) recently issued orders increasing the daily minimum wage of workers in the private sector.

Retail inflation growth slows in Metro Manila

Retail prices of goods in Metro Manila grew in January at their slowest pace in six months, preliminary data from the Philippine Statistics Authority (PSA) showed. The National Capital Region’s (NCR) general retail price index (GRPI) grew by 1.9% year on year in January, slower than the 2.1% posted in December but quicker than the 1.5% in January 2021. The January growth rate was the slowest in six months since the 1.8% expansion in July last year. Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort attributed the slower growth in January to “seasonal slowdown” after the holidays. January also saw lockdown restrictions tightened to curb an Omicron-driven surge in coronavirus cases.