Senate ratifies RCEP with more than two-thirds voting for it
The Senate ratified the Regional Comprehensive Economic Partnership (RCEP), with 20 senators voting for Senate Resolution No. 485. Senate President Juan Miguel Zubiri and Senate President Pro Tempore Loren Legarda sponsored the resolution during the plenary session. Only one senator, Risa Hontiveros, voted against it and another, Imee Marcos, abstained.
RCEP may take effect as early as May
The Philippines is hoping to attract more foreign investments and boost its exports once the Regional Comprehensive Economic Partnership (RCEP) trade deal takes effect as early as May, according to Trade department officials. At the same time, top business groups cheered the Senate’s approval of the Philippines’ participation in the world’s largest trade deal which includes Australia, China, Japan, South Korea, New Zealand and members of the Association of Southeast Asian Nations (ASEAN). The European Chamber of Commerce of the Philippines said in a separate statement that the RCEP’s ratification “sends a positive message that the Philippines upholds and values a rules-based trading system.”
Foreign business groups vow to boost PHL investments
Foreign business groups said they “look forward” to working with the Philippine government to improve the Philippines’s investment climate in light of the “new opportunities” that the Regional Comprehensive Economic Partnership (RCEP) provides. “We thank the Philippine Senate for the measured and deliberate process it took in finally concurring in the ratification of the RCEP,” the seven members of the Joint Foreign Chambers (JFC) said.
“We look forward to working with the Philippine government to improve the countries’ investment climate and attract more foreign investments in light of the new opportunities that RCEP provides,” the chambers noted. With RCEP being touted as the largest trade bloc in the world, the seven chambers said the Philippines’s inclusion in the trade deal “further expands the network of foreign markets accessible to Philippine exports.”
PHL economy seen to expand by 4.1% this year
Philippine economic growth is expected to slow to 4.1% this year, as external headwinds and elevated inflation are seen to dampen domestic demand, Oxford Economics said. “After registering respectable growth of 7.6% in 2022, we expect the Philippines’ economy to slow to 4.1% amid global headwinds, elevated inflation, and a fading reopening boost. With monetary tightening set to continue, the economy could use a hand from the fiscal side, but chances are slim,” Makoto Tsuchiya, assistant economist at Oxford Economics, said. Oxford Economics’ gross domestic product (GDP) projection is well below the government’s 6-7% target. It expects GDP to expand by 4.5% next year, still outside the 6.5-8% target set by the government.
Marcos OKs 19 projects to boost PH innovation
President Ferdinand "Bongbong" Marcos Jr. has approved 19 projects as part of his administration's efforts to promote and advance the culture of innovation in the country, Socioeconomic Planning Secretary Arsenio Balisacan announced Tuesday. Marcos, who heads the National Innovation Council (NIC), gave the nod for the projects. "The Council has approved 19 projects or project proposals amounting to P115 million under the Innovation Grants—majority of which sought to address the pre-commercialization and commercialization requirements of innovative products or services, the enhancement of innovation facilities and services, and the conduct of capacity-building activities," Balisacan said during a Palace press briefing.
8.1% AVERAGE IN Q1: Inflation to decelerate starting mid-year
The country may start experiencing lower inflation rates by the middle of 2023 if the government is able to immediately address issues contributing to it, Socioeconomic and Planning Secretary Arsenio Balisacan said yesterday. Balisacan said the government is banking on the plateauing of inflation in the first quarter of the year. He said factors such as the harvest season during the first three months of the year and the absence of major typhoons during the first quarter would contribute to the deceleration of inflation. This developed as Market Call, a report of First Metro Investment Corp. and UA&P Capital Markets Research, said inflation rate will likely remain elevated and will average 8.1 percent in the first quarter.
House adopts resolution backing immediate Regional Comprehensive Economic Partnership ratification
Citing its benefits to the economy, the House of Representatives adopted a resolution supporting the immediate ratification of the Regional Comprehensive Economic Partnership (RCEP) agreement. The plenary adopted House Resolution 728, after the House Committee on Trade and Industry approved the same at the committee level. In his manifestation, economist and Albay Rep. Joey Sarte Salceda expressed his support for the ratification of the RCEP, provided that “we can address certain concerns about domestic competitiveness.”
BIR firms up definition of ecozone logistics providers eligible for zero VAT
The Bureau of Internal Revenue (BIR) said it has more clearly defined which economic zone logistics service enterprises (ELSE) are entitled to the zero value-added tax (VAT) incentive. In a memorandum circular, the BIR said it published a clarification of eligible logistics providers as those engaged in “activities in support of exporters.” It said ELSEs must be registered business enterprises supplying production-related raw materials and equipment catering exclusively to the requirements of export manufacturing enterprises registered with the Philippine Economic Zone Authority (PEZA), Clark Development Corp., Subic Bay Metropolitan Authority, Authority of the Freeport Area of Bataan or other special economic zones and freeports outside PEZA administration.
DOT sees domestic trips recovering to 122 million in 2023
The Department of Tourism (DOT) sees the full recovery of the domestic travelers business this year, and the international arrivals in 2024. In her first meeting with the multi-agency Tourism Coordinating Council (TCC) on Monday, Tourism Secretary Christina Garcia Frasco presented a draft of the National Tourism Development Plan (NTDP) for 2023-2028, a blueprint of strategies and projects for the country to be able to reach annual domestic and international tourist arrivals along with the foreign and local visitors receipts. “Even as the pandemic set back our gains, the momentum for recovery and growth is already here. We see domestic tourism recovering to 2019 levels this year, and international tourism next year,” she said.
Think tank: Next rate hike may only be 25 bps
The Monetary Board is expected to raise interest rates by only 25 basis points in its next policy meeting, according to a local private think tank, First Metro Investment Corp.-University of Asia and the Pacific (FMIC-UA&P) Capital Markets Research. The think tank said inflation is expected to cool and average 8.1 percent in the first quarter of 2023. This may be the impetus for the Bangko Sentral ng Pilipinas (BSP) to raise rates at a slower pace of 25 basis points. Last week, the Monetary Board raised interest rates by 50 basis points, effectively increasing overnight reverse repurchase facility rates to 6 percent.
THE Department of Trade and Industry (DTI) assured consumers at the weekend they will have access to affordable basic necessities and prime commodities (BNPCs) amid the global inflation. The Philippine mining industry should first have a “clear cut” policy before it can attract investments into nickel processing, according to officials of the Department of Trade and Industry (DTI). The Department of Trade and Industry (DTI) is hoping that the European Chamber of Commerce of the Philippines (ECCP), along with European companies, will assist in pushing for the resumption of the Philippines-European Union Free Trade Agreement (PH-EU FTA) negotiations. The Department of Trade and Industry (DTI) said it has sealed 3,318 units of vape products worth P863,240 from eight “non-conforming” vape shops in Manila.
State-owned ports are ready to receive cruise ships as tourism steadily recovers. Philippine Ports Authority (PPA) stated that several cruise trips have resumed from February 9 to 14 in different parts of the country after a three-year hiatus due to the pandemic. Among the places that the cruise lines visited were Ilocos Sur, Palawan, and Bohol. “This international event ignites domestic travel and will definitely generate jobs for our countrymen in the said regions. It is about time that we live with the new normal and the PPA is proud to welcome again these international luxury ships to our shores as we bounce back from the effects of the pandemic,” said Jay Santiago, PPA general manager.
New energy roadmap set for release this year
The Department of Energy (DOE) targets to release within the year a new energy roadmap up to 2050. The country’s current energy plan covers only up to 2040. “The latest Philippine Energy Plan that we have right now covers the year 2020 to 2040. We are updating this plan to expand the planning horizon up to 2050 and we need to consider many developments,” DOE director for Energy Policy and Planning Bureau Michael Sinocruz said. “We’re going to have a planning conference to set the targets for the next Philippine energy plan, hopefully to be released before end of this year,” he said.
House panel approves bill mandating higher VAT refund for foreign tourists
The Ways and Means Committee of the House of Representatives approved House Bill No. 7143 that proposed raising the threshold of value-added tax refund for foreign tourists to P3,000, from P2,000, on goods they have purchased from accredited retailers. As it is, the Philippines is managing the tourism sector’s recovery from the pandemic. The public health crisis shut down the tourism industry in 2020 and 2021 as mobility restrictions prevented tourists from visiting the country.
Electric vehicle rollout strategy to incentivize ‘green’ transport routes
The Department of Transportation (DoTr) said its strategy for promoting electric vehicles (EVs) will focus on creating “green” transport routes whose operators will be granted incentives for deploying EVs. “We will release a department order that will further enhance and promote EVs so we see their proliferation in the next couple of years. We will provide incentives and leeway for EVs to (operate on transport) routes,” Transportation Undersecretary Mark Steven C. Pastor said. Mr. Pastor said the government is working on low-carbon urban transport systems to increase demand for EVs and make the 5% fleet quota mandatory for transport operators. “There is also a proposed incentive for EVs to ensure the readiness of green routes, charging stations, and other support programs,” he added.
SEC helps promote sustainable investment framework
The Securities and Exchange Commission (SEC) shared its efforts toward sustainable finance during the Organization for Economic Co-operation and Development (OECD) Ministerial Meeting on Responsible Business Conduct (RBC) in the Global Economy, held recently in Paris, France. SEC Commissioner Kelvin Lester Lee said promoting and enabling a sustainable investment framework would help ensure that business activities and investment decisions contribute to progress while also protecting Philippine resources.
In close partnership with government, businesses, civil society, and academia, ECCP passionately works to enhance the business environment for both European and Filipino companies.