ECCP at Work

‘High inflation to linger until 2025’

The central bank’s Survey of External Forecasters for September showed that private economists raised their inflation forecasts to 3.7 percent from 3.5 percent for 2024 and to 3.5 percent from 3.4 percent for 2025. The economists also raised their inflation projections to 5.9 percent from 5.5 percent for this year, well above the central bank’s two to four percent target range. “They also anticipate further upside risks to the inflation outlook, due mainly to supply disruptions, particularly from the adverse impact of weather disturbances and trade restrictions,” the central bank said. According to the BSP, the risks to the inflation outlook are still tilted to the upside for 2023 to 2025 and may trigger a possible breach of the inflation target in 2024.

Govt debt up 22%

According to the latest cash operations report posted on the Bureau of the Treasury’s (BTr) website, the government’s gross borrowings in the first eight months of the year jumped to P1.68 trillion from the P1.38 trillion recorded a year ago. Gross domestic borrowings for the period accounted for the bigger chunk amounting to P1.28 trillion, up 23.37 percent from the year ago level of P1.04 trillion. Meanwhile, the BTr data also showed that gross external borrowings for the period went up by 16.81 percent to P394.56 billion from P337.79 billion a year ago. 

Philippines urged to raise power investments to $62 billion

The Philippines will need to double investments in power systems to $62 billion by 2040 to accelerate the reduction of carbon dioxide emissions in the energy sector, according to the World Bank.  “Rapidly decarbonizing the power sector entails doubling the cumulative capital investments in power systems by 2040 from $31 (billion) to $62 billion in present value terms, compared with the current ambition of the government,” the World Bank said. The multilateral lender said decarbonizing the power sector is the key for the country to successfully shift to clean energy. Moreover, a clean energy transition will help the country meet its commitments under the Paris Agreement.

Government eyes more perks for e-vehicles

In a presentation at the Philippine Electric Vehicle Summit (PEVS),” Trade Undersecretary for Innovation and Competitiveness Group Rafaelita Aldaba shared that through an EV incentives scheme, the government is looking to provide incentives to accelerate the shift from the traditional motor vehicle models to EVs. “Based on our calculations, we are looking at incentivizing four million EVs in the next 10 years, majority of which will be two wheelers and e-trikes along with e-PUVs (public utility vehicles) and e-bus,” Aldaba said. Aldaba said the purpose of the incentives scheme is to narrow the cost gap between EVs and the traditional vehicle models adding that this is in line with facilitating and accelerating the shift to EVs. 

Infrastructure spending surges 66% in August

In its latest National Government (NG) disbursement report, the DBM said infrastructure and other capital outlays jumped to P122.1 billion in August from P73.7 billion in the same month a year ago. “This was largely attributed to the disbursements made by the Department of Public Works and Highways (DPWH) for its completed projects nationwide, such as national roads and bridges, infrastructure projects, flood control projects, convergence programs, and payment of right-of-way claims,” the DBM said. The DBM also cited payments made by development partners for the Department of Transportation’s (DoTr) railway projects, such as the Malolos-Clark Railway Project and the South Commuter Railway Project. 

Arresting PH decline in English proficiency [mention]

The Philippines needs to boost efforts to halt the decline in English proficiency among Filipino workers, foreign business groups said last week. Paulo Duarte, president of the European Chamber of Commerce of the Philippines, said that our country's advantage in English made us an attractive destination for international trade and investment. However, the country slipped four notches down to 22nd place out of 111 countries in the 2022 edition of the English Proficiency Index (EPI). The country's EPI score of 578 falls under the category of "high proficiency," considered to be enough for tasks like making work presentations, understanding TV shows and reading newspapers. But the Philippines must not risk losing this crucial advantage.

New vehicle sales up 9.5% in Sept.

New vehicle sales grew by an annual 9.5% in September, the slowest pace in 19 months, according to the joint report by the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and the Truck Manufacturers Association (TMA). “We recorded the highest monthly sales performance in September and we hope that a positive consumer outlook will be sustained in (the fourth quarter),” CAMPI President Rommel R. Gutierrez said. “The automotive market has remained resilient since 2021 and the current trend indicates that we will breach the highest pre-pandemic sales performance and achieve full industry recovery in 2023,” said Mr. Gutierrez.

‘MIC infusion didn’t dent LBP, DBP loan fund for farmers’

The Department of Finance (DOF) said the capital infusion by the Development Bank of the Philippines (DBP) and the Land Bank of the Philippines (LandBank) to the Maharlika Investment Corp. (MIC) did not impact their “loanable funds” to farmers and other sectors. Diokno claimed that LandBank and DBP continue to “maintain” a “solid” financial position even after their respective capital infusions to the MIC. “We are continuously talking to all stakeholders involved in order to ensure the best possible outcome for the Fund. Both LBP and DBP are resolute in their commitment to responsible financial management and shall have proper representation in the Board,” he added. 

‘Cybersecurity experts pool must protect data, infra, investments’

“It’s essential to enhance our existing talent pool and elevate the expertise of our IT professionals. We should also consider engaging the services of ethical hackers to bolster our cybersecurity frameworks,” Stratbase Group CEO and Founder  Prof. Victor Andres Manhit said. In the digital age, Manhit  stressed that cybersecurity is a vital investment at all levels, as data breaches are committed on a regular basis. He said businesses must ensure uninterrupted operations and secure data, provide peace of mind and build trust with customers and stakeholders. Manhit also underscored the vital role  of Chief Information Security Officers (CISO), for each agency or organization, mandated to maintain the most robust and appropriate protection from hackers and instilling a cyber hygienic culture to all its network users.

DBM green-lights government’s campaign combating hunger

The Department of Budget and Management (DBM) has approved the Department of Social Welfare and Development’s (DSWD) budgetary requirements for the expanded implementation of the “Walang Gutom 2027” program—a flagship initiative of the Marcos Jr. administration for the upcoming year. DSWD’s undersecretary for Innovations Eduardo Punay revealed that the program will require a budget of P6 billion for 2024, according to a statement released by Malacañang. He mentioned that the DBM has assured the provision of the necessary financial resources for the program, then said that such will be implemented next year by way of Executive Order (EO) 44, which enacted the “Walang Gutom 2027: Food Stamp Program.” He shared that the DSWD’s goal is to fully implement the program, targeting 1 million food-insecure households across the nation.

Realty consultant sees revival of tourism sector next year

Leechiu Property Consultants (LPC) sees a revival of the tourism sector by next year, perking up the real estate segment of the industry. The realty consultant said figures in the third quarter of the year revealed a “promising” outlook on Philippine tourism, with international tourist arrivals numbering 4,038,379 as of September 30. It noted additional hotel projects set to be announced in the coming months or years, aligning with the DOT’s target of 12 million international arrivals for 2028. Alfred Lay, LPC director for hotel, tourism and leisure, noted ongoing developments in Panglao, including the proposed 50-hectare Panglao Shores project, the upcoming JW Marriott hotel, the Cebu-Bohol bridge and large-scale energy initiatives designed to meet Bohol’s growing energy demands. “Overall, 2024 is anticipated to be the year in which broad indicators in the global tourism industry (e.g., tourist arrivals, flight capacity and hotel occupancy rates) finally recover to pre-pandemic levels,” he said.

ADB study shows gender divide in use of digital financial services

While there is a generally favorable climate for women-owned micro, small and medium-sized enterprises (WMSMEs) in the country, a study published by the Asian Development Bank (ADB) found that fewer women used digital financial services (DFS) as opposed to men. “Although DFS is a vital component of financial inclusion and the empowerment of women, there is a major gender divide in terms of using digital financial services and technologies: 28 percent of WMSMEs use DFS while the adoption rate of DFS among men MSMEs was 44 percent,” the report said. The study pointed to DFS as a critical component of women’s financial inclusion and empowerment as it meets the unique financial needs of women while providing convenient and easy-to-access financial services. “Digital finance also helps to lower banking and financial transactional costs and provides access to a broad range of financial services,” it added.

Philippines sees challenge of limited arable lands

Being an island nation, the Philippines has limited arable lands compared to major rice producing countries such as Thailand and Vietnam, making it difficult to become rice self-sufficient, according to International Potato Center (CIP) regional director for Asia Samarendu Mohanty. Coupled with the continued population growth, the Philippines’ goal of attaining self-sufficiency might be a long shot. Latest data from the Philippine Statistics Authority (PSA) showed the country’s self-sufficiency ratio (SSR) in rice fell to 77 percent last year from 81.5 percent in 2021. But the government is implementing measures and programs to increase the country’s rice yield per hectare. Moreover, DA Undersecretary for rice development Leocadio Sebastian said the Philippines has already come a long way in terms of rice yield per hectare.

Oil price hike to take effect this week

In separate advisories, Shell, SeaOil, CleanFuel and Caltex announced a P0.95 per liter price hike on gasoline. PetroGazz, Jetti, Unioil and PTT will also implement the same price adjustments on gasoline. Diesel prices for all petroleum companies will also increase by P1.30 per liter. The price change ends the three-week consecutive rollbacks for diesel. Meanwhile, kerosene prices will increase by P1.25 per liter.  On Friday, the Department of Energy said that the increase was due to the depletion of crude oil stockpiles in the United States.

Government eyes EV-dedicated manufacturing zone

In a presentation at the Philippine Electric Vehicle Summit (PEVS), Trade Undersecretary for Innovation and Competitiveness Group Rafaelita Aldaba said that developing the EV infrastructure is part of the EV industry strategy. “The infrastructure would cover the development of dedicated zones and robust transport facilities that will be tailored for EV manufacturing and R&D (research and development),” Aldaba said. The Trade official said the development of EV-dedicated zones would be done in coordination with ecozone-related agencies such as the Philippine Economic Zone Authority (PEZA) and the Authority of the Freeport Area of Bataan (AFAB), among others.

DTI launches EV incentives program

At the 11th Philippine Electric Vehicle Summit in Pasay City on Friday, DTI Undersecretary Rafaelita Aldaba said the EVIS targets to have 4 million locally manufactured e-vehicles in the country in the next 10 years. "One important component of the EVIS is the e-PUV Program, the focus of which is on the commercial EV market. This is going to be a CARS (Comprehensive Automotive Resurgence Strategy)-like program catering to the manufacturing of commercial vehicles, and this is going to complement the CARS Program," she added. Under the CARS Program, the government provides fiscal incentives to participating carmaker for their investments in the local production of the vehicle and tax perks for every locally assembled unit sold. Under the EVIS' e-PUV+ Program, which include perks for passenger cars, mining and processing of green metals for EV, auto electronics and charging infrastructure, the government can provide fiscal incentives under the Corporate Recovery and Tax Incentives for Enterprises Law.

PHL’s score in global trading index rises

The Philippines remained at the 12th spot out of 30 economies whose “readiness and capacity” to participate in the global trading system was gauged, but increased its score to 61.4 from last year’s 49.5. Under the Economic pillar, data from the report indicated that the country ranked first out of the 30 economies in terms of growth in labor force. The Philippine ranking in the Societal pillar climbed to the 14th spot from last year’s 17th; however, data from the report indicated that the country’s performance in the area of political stability and absence of violence deteriorated to the 27th from last year’s 25th spot. Under the Environmental pillar, which measures the “extent to which an economy’s trade supports sustainable resources,” the country’ ranking climbed to the 4th spot from last year’s 5th.

PUBLIC UTILITY VEHICLE MODERNIZATION PROGRAM: DOTr: 70% have joined transport coops

The Department of Transportation (DOTr) yesterday said about 70 percent of the traditional jeepneys have joined transport cooperatives as part the Public Utility Vehicle Modernization Program (PUVMP). Transport workers consolidating into cooperatives not only helps in the success of modernizing public transportation but also brings socio-economic and cultural benefits to member operators and drivers, it added. Transportation Secretary Jaime Bautista cited the benefits of PUVMP while urging OTC members to attest to the advantages of joining cooperatives. Under the PUVMP, operators and drivers must organize into a cooperative or corporation to establish larger fleets of PUVs.