ECCP at Work

FDI net inflows drop in May to a four-month low

Net inflows of foreign direct investments (FDI) declined in May, as elevated inflation and multi-year high borrowing costs dampened investor sentiment. Data released by the Bangko Sentral ng Pilipinas (BSP) showed that FDI net inflows fell by 34% to $488 million from $739 million a year earlier. It also dropped by 44.2% from the $876-million FDI net inflows in April.  

Govt: PH ripe for open finance

UBX, the leading open finance platform in the Philippines; the Bangko Sentral ng Pilipinas (BSP); and members of the ECCP Special Committee on Open Finance and Financial Inclusion (SCOFFI) have pledged to leverage open finance in driving financial inclusion in the country. In a Kapihan Session by ECCP-Scoffi, UBX Managing Director for Open Finance Jamie Garchitorena and BSP Deputy Gov. Chuchi Fonacier underscored the readiness of the Philippines to embrace open finance.

Renewable energy projects will generate 75,000 jobs – labor chief

The Marcos administration’s aggressive push to invite foreign investors into the country’s burgeoning renewable energy sector is starting to bear fruit, with commitments in place to invest in projects that will generate around 75,000 new jobs, Labor Secretary Bienvenido Laguesma said on Tuesday. Laguesma said in a Malacañang press briefing that Trade Secretary Alfredo Pascual had informed him that several projects in the power industry “will materialize,” particularly in renewable energy, thanks in part to President Ferdinand Marcos Jr.’s foreign trips during which he talked to business groups about local investment prospects.

BIR soliciting business groups’ input to improve tax services 

The Bureau of Internal Revenue (BIR) said it is consulting business groups to gain insights on how to streamline tax administration. The BIR signed a memorandum of agreement with the Joint Foreign Chambers of the Philippines; Philippine Chamber of Commerce and Industry (PCCI); Tax Management Association of the Philippines; Management Association of the Philippines; Financial Executives Institute of the Philippines; Philippine Institute of Certified Public Accountants; Association of Certified Public Accountants in Public Practice; Association of CPAs in Commerce and Industry; Philippine Exporters Confederation, Inc. (Philexport).

P543B eyed for climate change mitigation

The government is planning to set aside P543.4 billion under the proposed 2024 National Expenditure Program to address the impact of climate change. The allocation for climate change mitigation and adaptation strategies constitutes 9.4 percent of the total proposed budget, Amenah Pangandaman, Department of Budget and Management (DBM) secretary, said. This figure surpasses the anticipated eight percent contribution stipulated in the Philippine Development Plan.

Extension of estate tax amnesty lapses into law 

The bill expanding the coverage of the estate tax amnesty and extending the period of availment by another two years has lapsed into law. Republic Act (RA) No. 11956 extends the availment period for the estate tax amnesty for another two years (June 15, 2023 to June 14, 2025). The new law also expands the amnesty’s coverage to include the estates of those who died on or before May 31, 2022. The law allows taxpayers to pay the amnesty tax either manually or electronically through any authorized agent bank, revenue district office or an authorized tax software provider. It also limited the number of documents required for filing the application for tax amnesty.

Trade gap narrows to $3.92B in June

The Philippines trade-in-goods deficit narrowed for a third consecutive month in June as imports contracted to a near three-year low while exports were flat as global demand for goods weakened.  The value of merchandise imports contracted by 15.2% year on year to $10.62 billion in June, worse than the revised 8.1% drop in May, preliminary data from the Philippine Statistics Authority (PSA) showed on Tuesday. This was also a reversal of the 26.4% growth in June 2022. Imports have been on a decline in the last five months, but June saw the sharpest drop in nearly three years or since the 15.9% drop in October 2020.

Two Japan ODA packages signed for disaster resilience, PCG projects 

The Japanese Embassy in Manila has signed two official development assistance (ODA) agreements with the Philippines worth a total of ¥31.1 billion, or around P12 billion. The ODA packages cover the third phase of the Post-Disaster Standby Loan (PDSL) worth ¥30 billion and a ¥1.1-billion grant for the Philippine Coast Guard’s (PCG) satellite data communication system. The embassy said that Mr. Koshikawa and Foreign Affairs Secretary Enrique A. Manalo signed the exchange of notes on the loan facility and grant project on Tuesday. The post-disaster loan will “support swift recovery in the aftermath of natural and health-related disasters, providing a quick-disbursing budgetary support for the Philippines’ calamity response programs.” 

RE firms explore floating solar projects

Local renewable energy companies have signed Renewable Energy Contract Area Utilization (RECAU) agreements with the Laguna Lake Development Authority (LLDA) yesterday to lease areas for the operation of floating solar projects.ACEN Corp. through its subsidiaries have signed for 800 hectares (ha) which could translate to around 1,000 megawatts (MW) of capacity. “As we explore the potential of our first large-scale floating solar project which will be a crucial part of ACEN’s master plan to achieve our 2030 goal, we are excited to spearhead this energy innovation in the Philippines. We are committed to expanding our clean energy assets while addressing land scarcity,” said Eric Francia, ACEN president and chief executive officer, in a statement.

Factory output slows in June 

The country’s manufacturing industry expanded at a slower pace in June because of production declines from the food and metal industries. The Philippine Statistics Authority (PSA), in a report, said that the volume of production index (VoPI) for the manufacturing industry grew by 3.4 percent in June. When compared, the VoPI grew at a faster rate of 7.7 percent in May, although it shrank by 0.04 percent in June of last year. The PSA attributed the slower pace of growth to the decline in the manufacture of food products and fabricated metal of 3.2 percent and 36.4 percent, respectively. Also, the PSA said beverage makers decreased their output by 7.7 percent in June. According to the PSA, the drop in food production was driven by the reduction of output from the dairy segment (13.3 percent) and other goods (6.9 percent). The processing and preservation of seafood also declined by 15.4 percent, faster than May’s 1.4 percent growth.

Infrawatch pushes passage of bill on regulation of motorcycle taxis 

Think tank Infrawatch urged Congress on Tuesday to “step up efforts to pass a law that will allow and regulate the use of motorcycles-for-hire or MC taxis as a public utility,” saying the proposal has been in limbo for the past four years.  Terry Ridon, Infrawatch PH convenor and former House transportation committee member, said the industry under review is now “in a loop” after running for almost half a decade and is still without resolution. The MC taxi pilot started in 2019, supervised by the MC Taxi Technical Working Group. Three players were allowed to join the program, namely, Angkas, Joyride, and Move It. Ridon noted that the pilot study that the MC Taxi TWG should have accomplished has “now been delayed by four years, with no clear recommendations being released yet, stalling legislative efforts in the aftermath.”

Public works need 3M workers/year

The government would need more than three million workers each year for the infrastructure program of the administration, including big ticket projects that would start next year, Department of Public Works and Highways (DPWH) Secretary Manuel Bonoan said yesterday. Bonoan in a briefing in Malacanang  said these jobs for skilled and unskilled workers are only for  DPWH’s infrastructure projects. He said total capital outlay for the projects in 2023 is more than P800 billion covering 70,000 big and small contracts. Labor Secretary Bienvenido Laguesma in the same briefing presented the Philippine Labor and Employment Plan 2023-2028 (LEP) which aims to reduce unemployment and address underemployment with quality jobs, and increase the income earning ability of Filipinos.

BIR, private sector sign deal for efficient tax payment 

The Bureau of Internal Revenue (BIR) on Tuesday signed a memorandum of agreement (MOA) with business groups, chambers of commerce and association of tax professionals for a more efficient tax collection and administration.The MOA was signed by the BIR, Philippine Chamber of Commerce and Industry (PCCI), Tax Management Association of the Philippines (TMAP), Management Association of the Philippines (MAP), Financial Executives Institute of the Philippines (FINEX), Philippine Institute of Certified Public Accountants (PICPA), Association of Certified Public Accountants in Public Practice (ACPAPP), Association of Certified Public Accountants in Commerce and Industry (ACPACI), Philippine Exporters Confederation Inc. (Philexport) and joint foreign chambers.

Chemical industry roadmap being updated

The Samahan sa Pilipinas ang mga Industriyang Kimika (SPIK) or the Philippines chemicals industry Association is updating its roadmap focusing on post-pandemic economic recovery, sustainability, innovation, the need for deeper industry integration and linkages, and supply chain reliability. SPIK in a project brief said the new roadmap will be  aligned  with  the new Philippine Development Plan (2023-2028) which is geared towards economic and social transformation to reinvigorate job creation and accelerate poverty reduction through inclusive economic growth. The previous Philippine Chemical Masterplan (2012-2030) has guided the chemical industry in pursuing long term sustainable and inclusive industrial growth in the Philippines, SPIK said. The updated Philippine Chemical Industry Roadmap: Enabling Industry Linkages, Sustainability and Safe Materials (2023-2028) is being developed in strategic partnership with the Board of Investments, the  Environment Management Bureau and the Philippine Council for Industry, Energy, Emerging Technology Research & Development.

Agri modernization, education reform seen as next drivers of growth in jobs

Agriculture modernization and updating the education system need to be the next steps after the government’s decision to tout infrastructure as the driver of employment, labor groups said. Public Works Secretary Manuel M. Bonoan said on Tuesday that the labor requirement for major infrastructure projects will exceed three million workers Labor Secretary Bienvenido E. Laguesma said his department will collaborate with the DPWH to hire skilled and unskilled workers for the 70,000 ongoing major and minor infrastructure projects this year. On Tuesday, Mr. Laguesma presented his department’s labor and employment plan to the Cabinet. The plan called for greater coordination with other agencies to create sustainable jobs and ensure social protections for workers.

APEC sees trade barriers rising within bloc

Trade barriers are being erected by members of the Asia-Pacific Economic Cooperation (APEC) bloc, the APEC Policy Support Unit (PSU) said in a report. It said commercial trade among APEC members recovered to $4.9 trillion in 2022, lower than the estimated $5.4 trillion for 2022 “had there been no pandemic.” The finding was contained in its Monitoring Pandemic Recovery Under the APEC Services Competitiveness Roadmap (ASCR) report. According to the PSU, recently introduced trade restrictions are affecting foreign entry, movement of people, competition, and create momentum for other discriminatory measures. 

PH automotive market to hit 1M

An executive of Mitsubishi Motor Philippines Corp. (MMPC) sees the potential of the Philippines to become a 1-million market in five to six year. Takeshi Hara, MMPC president, in a press conference on the sidelines of the company’s 60th anniversary expo at World Trade Center yesterday, the prediction is that total industry volume is to reach 400,00 units “or maybe 420,000 or 430,000 units.”MMPC  is eyeing to sell 75,000 units of vehicles this year, garnering 18 percent of market share, according to Jack Ramirez, first vice president for marketing. These figures are slightly higher than last year’s 60,630 units sold in 2022 equivalent to 16 percent market share.