ECCP at Work

Biz groups back Charter change

The ECCP, among other business organisations, back moves to amend the economic provisions of the 1987 Constitution, specifically lifting the foreign equity restrictions to attract more foreign direct investments (FDIs) into the country. "This can help put the spotlight on the Philippines as a viable investment destination, attracting more investors and foreign professionals into the country," ECCP Executive Director Florian Gottein said.

European chamber calls for PHL free trade deal to go on fast track

The ECCP said free trade agreement (FTA) negotiations between the EU and the Philippines should be fast-tracked to maximise its development impact. “We recognize that the timely conclusion of the EU-Philippines FTA will result in significant socio-economic development, as well as bring relations to new heights, especially in areas such as trade and investment, employment, economic diversification, innovation, and sustainability,” ECCP President Paulo Duarte said.

PHL, EU ‘aligned’ on key issues ahead of FTA talks

Ahead of the resumption of formal talks on the FTA between the Philippines and the EU, trade Undersecretary Allan B. Gepty expressed hope that the “stock-taking exercise” for the FTA would wrap up the assessments within the first quarter of this year and that there are many alignments when it comes to policy direction. USec Gepty explained that the trade agenda of the EU is “very particular” on sustainable development, environment, and climate change.

4 priority bills near approval as Congress resumes session

Speaker Ferdinand Martin G. Romualdez announced that the chamber is on the verge of concluding the approval of four bills outlined by President Marcos Jr. Speaker Romualdez said that a crucial measure focusing on promoting the development of a national defense industry is slated for third and final reading. The other three measures awaiting final approval are amendments to the Electric Power Industry Reform Act, the Budget Modernization Bill, and the National Defense Act.

House panel preps Create More Bill for plenary debates this week

The House Committee on Ways and Means has finalized the proposed Corporate Recovery and Tax Incentives for Enterprises Act (Create More), which seeks to establish a 20-percent income tax rate for both domestic and foreign corporations under the enhanced deduction income tax regime. 

BoI to allow return of registrants to PEZA after WFH legal opinion 

“The BoI supports the allowing of those who have transferred to BoI to seamlessly be able to go back to their PEZA registration if they prefer it,” Department of Trade and Industry (DTI) Undersecretary and BoI Managing Head Ceferino S. Rodolfo said. “The DoJ legal opinion essentially confirms the existing mechanism that provides the flexibility that now allows us to continue to attract business process outsourcing (BPO) investments into the Philippines,” commented Usec. Rodolfo on the DoJ legal opinion on Section 309 of the CREATE Act.

Higher govt debt swells PHL external liability position in ’23 Q2—BSP 

Higher government debts increased the country’s net external liability position in the second quarter of 2023, according to the Bangko Sentral ng Pilipinas (BSP). Based on the latest balance sheet data, the BSP said the country’s net external liability position widened by 4.8 percent quarter-on-quarter to P2.4 trillion in the second quarter of 2023 from P2.3 trillion in the first quarter of 2023. Net debtors were non-financial corporations and the general government, while net creditors were households, other depository corporations, the rest of the world, other financial corporations, and the central bank.

Campi: Vehicle sales growth to quicken by 10-15% in ’24

Vehicle sales in the Philippines hit a record high 429,807 in 2023, a substantial 21.9-percent growth compared to the previous year, with the sales volume beating the industry’s revised annual sales target of 423,000 as well as their prepandemic sales level.

DBM to work on digitalization plans

The Department of Budget and Management (DBM) has laid out its digitalization initiatives to ensure greater efficiency in the delivery of public services. A Digital Transformation Roadmap, which promotes data governance and digitalization in fiscal-related government processes, will soon be launched, according to Budget Secretary Amenah Pangandaman. Upcoming initiatives include using blockchain technology to enhance the management of critical data, satellites to monitor fund use alongside project completion, and government dashboards to monitor allotments across departments.

BoP reverts to surplus, reaches $3.7 billion last year 

The country’s balance of payments (BOP) position reverted to a surplus, hitting $3.67 billion last year and reversing the $7.26 billion deficit recorded in 2022, according to the Bangko Sentral ng Pilipinas (BSP). The amount was more than three times the BSP’s latest BOP surplus projection of $1.1 billion. The BSP noted that this development mainly reflected the improvement in the balance of trade. Other contributors include the higher net inflows from personal remittances, improved trade in services, higher foreign borrowings by the national government, and net inflows from foreign direct investments. 

DENR sets P15B projects this year 

The Department of Environment and Natural Resources (DENR) expects $278 million foreign-funded projects biodiversity and climate change programs to further strengthen environmental resiliency and sustainability in local government units (LGUs). In a statement, DENR Secretary Ma. Antonia Yulo Loyzaga noted the need to secure foreign funding to bridge financial gaps in implementing environmental projects in the country. DENR said countries that provided the grants include Japan, Australia, United States, South Korea and Canada.

Cuts in RRR, not just rates, possible–BSP 

BSP Governor Remolona noted that it is possible but unlikely that the BSP will start reducing its current 6.5% target reverse repurchase rate in the first six months of 2024 due to the possibility of supply shocks that could trigger second-round effects and heighten inflation expectations. BSP’s forecast for inflation in 2024 is around 4-4.2% and it is not quite within range but close to within range of the 2-4% government inflation target for the next three years.

BSP's Monetary Board approved $14.49-B gov’t foreign borrowings in 2023 

$14.49-billion worth of foreign borrowings in 2023 were approved by the BSP Monetary Board, reflecting a 40.36% increase to the approvals made the previous year due mainly to higher program and project loans. The 2023 borrowings will finance the national government projects:  infrastructure worth $4.07 billion; general financing requirements worth $4.00 billion; economic recovery and development worth $3.07 billion; COVID-19 response programs worth $2.27 billion; and education worth $0.21 billion.

Dof preparing medium-term strategy for managing debt 

The Department of Finance said it is preparing a medium-term strategy for managing debt, with an eye towards ensuring fiscal sustainability. “Soon, we will develop a Philippine Medium-Term Debt Management Strategy,” Finance Secretary Ralph G. Recto said in a speech, adding that another objective of the plan is to ensure transparency in public borrowing. The national government’s outstanding debt stood at Php 14.51 trillion or 60.2% of gross domestic product. The government is targeting to bring down the debt-to-GDP ratio to below 60% by 2025.

Meralco sees 4.5% growth in energy sales volume for 2024 

Manila Electric Co. (Meralco) is expecting a 4.5% increase in energy sales volume for 2024, Meralco First Vice-President and Chief Commercial Officer Ferdinand O. Geluz said. On the business segments, Meralco expects that the energy sales from the industrial sector will rebound around 5-6% after a 1% decrease in the first nine months of 2023. Meanwhile, the residential segment is projected to see a “spike” due to El Niño.

APECO’s new administration brings immediate results 

The Aurora Pacific Economic Zone and Freeport Authority (APECO) has formally entered into a partnership with the Philippine Aerospace Development Corporation (PADC) to begin developing the country’s first national defense hub. APECO is slated to become the epicenter of PADC’s maintenance operations, the assembly site for various air assets including that of Armed Forces of the Philippines (AFP) and the Philippine Coast Guard, and site for its new flagship drone program, aiming to introduce new defense capabilities for the AFP and the key allies of the Philippines.

SEC draft memo calls for disclosure of cornerstone investors in IPOs

The Securities and Exchange Commission (SEC) is proposing a new policy requiring the identification of cornerstone investors in the final prospectus of initial public offerings (IPOs). In a draft memorandum circular (MC) released for public comment on Jan. 19, the SEC calls for the identification of cornerstone investors in IPOs, defined as those committing to subscribe to a company’s shares before the public listing. 

2023 business registrations post 5% growth

The Department of Trade and Industry (DTI) said 984,332 business names were registered last year, up 5%, attributing the rise to its digitalization efforts. 88% or 864,200 of the registrations were new, while 12% or 120,132 were renewals. Small retail businesses, known in the Philippines as sari-sari stores, remained the top business activity among registrants with 172,905. Other top registrants include other restaurants and mobile food services activities with 78,174 business registrations, and real estate businesses which had 41,165 registrations.

10 offshore wind projects to generate power by 2028 

At least 10 offshore wind projects with 6.72-gigawatt (GW) capacity are expected to generate power by 2028, according to Energy Undersecretary Rowena Cristina Guevara. Guevara said that as of November 2023, 82 offshore wind energy service contracts with a total capacity of 63.36 GW have been awarded by the DOE. The projects are located mainly in north Luzon, west of Metro Manila, and various areas in Mindoro, Panay, and Guimaras Strait.

PEZA readies locators for possible disruption amid Red Sea attacks 

The Philippine Economic Zone Authority (PEZA) said it is preparing its locators, particularly those who export and source goods to and from Europe, for the possible impact of trade disruption caused by attacks in the Red Sea. Impacts can include an additional 10 days for the exchange of goods between Europe and Asia and higher shipping costs. “At PEZA, we are already preparing for this by collaborating with the affected RBEs [registered business enterprises] sourcing, importing, and exporting to and from the EU and the Mediterranean to ensure that the least possible effects would be felt as contingencies are set in place in advance of any major conflict,” PEZA Director General Tereso O. Panga explained. 

Infra needs bloated PH foreign borrowings in 2023

The BSP said 28.10 percent or $4.07 billion of the total offshore debts approved by MB in 2023 went to infrastructure projects. This, as President Marcos targets to supercharge infrastructure spending to 5 to 6 percent of gross domestic product. Meanwhile, $3.07 billion or 21.16 percent went to projects and programs on economic recovery and development, as well as environmental protection and climate resilience

Philippines should fix broadband ‘duopoly’ — WB

THE GOVERNMENT should address barriers to efficient broadband infrastructure to help bridge the widening digital divide in the Philippines, where the market remains a duopoly, according to the World Bank (WB). “They own international connectivity, backbone, middle- and last-mile networks and have the majority subscriber share,” it pointed out. “Over 500 providers acting as retailers rely on wholesale infrastructure, either from the duopoly or market challengers.”

IMF: AI may boost Philippine labor productivity

“Because of the Philippine economy’s early structural transformation to a service-based economy, raising the level of service sector labor productivity through digital skills and portability will be essential,” IMF Resident Representative to the Philippines Ragnar Gudmundsson said. “This will require upskilling of the labor force to leverage artificial intelligence tools and continue to move up value chains, as well as efforts to develop the country’s digital infrastructure especially outside urban centers,” he added.

FTA with US broached anew

Finance Secretary Ralph Recto broached the possibility of having a free trade agreement (FTA) with the United States (US) during his meeting with US officials US recently. Recto also discussed  the further enhancement of security and military ties between the two nations. The DOF said Recto has assured US officials of the Philippines’ strong commitment to roll out a welcoming “red carpet” to potential investors in the country.

IBPAP: Workforce to hit 2M; change of rules damaging 

The  information technology-business process management (IT-BPM) targets to cross 2 million in full-time employees by 2025, a meaningful feat that could be challenged by scarcity in talent. Jack Madrid, president and chief executive officer of the Information Technology and Business Process Association of the Philippines (IBPAP) told reporters the Department of Justice (DOJ) opinion that strips incentives to companies implementing work-from-home outside economic zones could damage the reputation of the industry and the country where the rules are  changed in the middle of the game.

Agencies, LGUs tasked to implement GEMP

The President, through Administrative Order No. 15, signed on January 16, also directed government-owned or -controlled corporations and encouraged local government units to undertake efforts to ensure efficient and judicious use of energy.

Pia Cayetano named Senate blue ribbon chair 

SEN. Pia Cayetano was elected yesterday as the new chairperson of the Committee on the Accountability of Public Officers and Investigations, or the blue ribbon committee, after Sen. Francis Tolentino officially tendered his resignation as committee chairperson.

PhilHealth to expand ‘Konsulta’ meds package 

THIRTY-TWO drug products are set to be included in the list of medications provided by the Philippine Health Insurance Corporation (PhilHealth) under its “Konsulta” program. PhilHealth’s Outpatient Drug Benefit package currently covers only 21 medications. “This will bring PhilHealth’s coverage to a total of 53 outpatient medications, ranging from regiments covering infections up to maintenance medications for non-communicable diseases,” PhilHealth said in a statement.

Recto joins powerful Monetary Board

Both the BSP and the Department of Finance (DOF) confirmed the appointment of Recto, who took his oath of office on Monday as the latest member of the central bank’s policy-making body. Chaired by Governor Eli Remolona Jr., the MB is composed of five other full-time members from the private sector, namely Benjamin Diokno, V. Bruce Tolentino, Anita Linda Aquino, Romeo Bernardo and Rosalia De Leon.