ECCP at Work

Businessmen rue 'restrictive' economic provisions in 1987 Constitution

Foreign investors and Filipino businessmen told a Philippine Senate panel that economic provisions in the 1987 Constitution make it difficult to invest in the country. They also admit the ongoing feud between senators and congressmen over charter change is beginning to worry foreign investors.

FDI net inflows rise to near 2-year high

FDI net inflows rose by 27.8% year on year to $1.048 billion in November 2023 from $820 million in the same month in 2022, data released by the Bangko Sentral ng Pilipinas (BSP) on Monday showed. This was the highest monthly FDI net inflow recorded since the $2.662 billion in December 2021.

Economic growth may pick up to 5.7%

UBS Global Research and Evidence Lab raised its 2024 Philippine GDP growth forecast from 5.3% previously, Grace Lim, an economist from UBS, said in a note. It also hiked its 2025 projection to 6% from 5.8%. “This largely reflects carryover effects from the fourth quarter of 2023, rather than a strong bounce in sequential growth momentum through 2024,” Ms. Lim said.

Investor interest in power gaining steam – Lotilla

Investor interest in the country’s power sector, particularly in the renewable energy space, continues to gain steam, according to the Department of Energy (DOE). “We’re always receiving a lot of investor inquiries, not only inquiries but actual applicants,” Energy Secretary Raphael Lotilla said. The BloombergNEF Climatescope 2023 report released in December last year showed the Philippines is the fourth most attractive developing economy for renewable energy investment among 110 emerging economies.

Marcos foreign trips generate $14.2B in investments — DTI

The Department of Trade and Industry (DTI) said on Sunday that President Ferdinand R. Marcos, Jr.’s foreign trips have generated $14.2 billion in actual investment, for a hit rate of about 20% of investment pledges. As of December, the DTI said the President’s travels generated pledges of $72.2 billion across 148 projects. Manufacturing accounted for 16 projects or 35% of the total, while IT-BPM had 10 (22%) and nine renewable energy (20%).

Cargo traffic exceeds pre-pandemic level

PPA data showed cargo throughput grew 5 percent to 271.9 million metric tons (MT) in 2023 versus 259.14 million MT in 2022. Compared to the 265.9 million MT cargo throughput just before the pandemic, it was up by 2.3 percent. Domestic cargo was slightly up to 98.9 million MT last year from 98.3 million MT the prior year, while foreign cargo rose by 8 percent to 173.06 million MT from 160.8 million MT.

Growth, fiscal goals need to be ‘more realistic,’ says DoF chief

The Development Budget Coordination Committee (DBCC) may need to adjust its growth and fiscal targets to be “more realistic,” Department of Finance (DoF) Secretary Ralph G. Recto said last week. The government is targeting gross domestic product growth of 6.5-7.5% this year and 6.5-8% from 2025 to 2028 under the DBCC’s latest macroeconomic assumptions and medium-term goals.

‘Cha-cha won’t end economic problems’

Former Supreme Court Associate Justice Antonio Carpio and 1987 constitutional convention members Bernardo Villegas and Rene Sarmiento made the common position during the second hearing of the sub-panel of the Committee on Constitutional Amendments and Revision of Codes on the proposed Resolution of Both Houses (RBH) No. 6.

Senate, House urged: Compromise on Cha-cha deadline

Camarines Sur Rep. Luis Raymund Villafuerte yesterday urged the leaderships of the Senate and the House of Representatives to settle their dispute by compromising and setting a deadline for the approval of proposed Resolution of Both Houses No. 6. “We’re appealing for the March deadline, but now (the Senate) they are saying October. Maybe we can meet in the middle ground. That’s part of the democratic process,” said Villafuerte, president of the National Unity Party (NUP).

Nonmonetary measures needed to address rice inflation as prices may continue to climb

The aggressive rate hikes of the Bangko Sentral ng Pilipinas over the past two years have helped stabilize inflation, but nonmonetary measures are still needed, especially as rice prices remain high. Rice production and agricultural productivity must grow faster and surpass the expansion in the population and per capita consumption, Monetary Board member V. Bruce J. Tolentino explained.

SEC looking to implement hike in fees, charges this year 

THE Securities and Exchange Commission (SEC) hopes its planned hike in fees and charges can be finalized and implemented within the year, its top official said. “Preferably, at least within the year,” SEC Chairperson Emilio B. Aquino told reporters on the sidelines of an event last week when asked when they plan to implement the higher fees and charges.

Freeze on MAV seen pressuring prices of pork, corn upwards

The suspension of the minimum access volume (MAV) for pork and corn will push prices higher, economists said. “Suspending the MAV for pork and corn will increase the prices of pork but also chicken since corn prices constitute the biggest cost of livestock production,” Calixto V. Chikiamco, Foundation for Economic Freedom president, said. The MAV allows trading partners guaranteed market access subject to volume quotas and is a feature of the World Trade Organization (WTO) trading system. 

ARTA, AIM to create ‘dashboard’ to monitor PHL competitiveness

The Asian Institute of Management (AIM) and Anti-Red Tape Authority (ARTA) will jointly compile various independently released competitiveness metrics such as business efficiency and ease of doing business to be monitored via a so-called “dashboard” in a single website. “This will serve as a quick and reliable reference for investors from here and abroad to assess the country’s standing and recent performance,” Jamil Paolo S. Francisco, executive director of AIM’s policy center for competitiveness, said.

Islamic insurance seen helping deepen Philippine product penetration

Islamic insurance products such as Sukuk or Takaful can help address the low insurance penetration rate in the Philippines which is only 1.68% of gross domestic product in the third quarter, analysts said. Insurance Commissioner Reynaldo A. Regalado has said some insurance companies offer products that are takaful-compliant, which is an Islamic form of insurance consisting of pooled money that payouts are taken from. The IC is currently studying how takaful insurance can be processed and regulated. 

PSE: Short selling progress hinges on market recovery

The Philippine Stock Exchange, Inc. (PSE) is not bothered by the slow progress of its short selling product, PSE President and Chief Executive Officer Ramon S. Monzon said. The PSE launched short selling in November last year, five years after issuing the revised guidelines on the trading strategy, to entice foreign investors to consider the local exchange. However, the latest daily short selling report posted on the PSE’s website showed that there have been no developments on the new trading product.

Falling unemployment masks lack of quality jobs — think tank

High-quality jobs remain thin on the ground even with unemployment falling, with many workers forced by economic hardship to accept irregular and informal work, a think tank said. Jobs that are considered informal have increased, with the number of self-employed growing by 157,000 to 13.1 million in 2023, IBON Foundation said, adding that the number of unpaid family workers also grew by 154,000 to 3.8 million last year.

DOF: Easing inflation to spur H2 rate cuts

The slowdown in commodity prices is expected to fuel Finance Secretary Ralph G. Recto’s confidence that the Monetary Board will start cutting rates in the second semester of the year. Recto told reporters during the 2024 National Tax Campaign that no further rate hikes are expected, now that inflation has slowed to within the Bangko Sentral ng Pilipinas (BSP) expectations. In January, inflation slowed to 2.8 percent, which is within the BSP’s 2 to 4 percent target.

Bangsamoro EZA can now grant incentives to investors

The Bangsamoro Economic Zone Authority (BEZA) can now grant incentives to investors and is authorised to be an investment promotion agency for the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), the Fiscal Incentive Review Board (FIRB) announced in late January. BEZA Executive Director Sukarno Abas described this status as a milestone that would “enable the agency to fully operationalize its authority to grant fiscal and non-fiscal incentives to investors and enterprises willing to set up or establish their businesses in the BARMM economic zones.”

Canada adding ₱500-M devt aid to 6 PHL provinces in ‘24

Ahmed Hussen, Canada’s Minister of International Development, announced Friday in Toronto that the development assistance of Canada to the Philippines this year will now total CAD 28.15 or P1.1 billion Php, the biggest development program to the Philippines in recent years. Canada will fund the project to enhance climate resilience especially through national and local government and women-led organizations in six vulnerable provinces in the Philippines

High power rates push back investors–consumer group

“The foreign investors we are trying to attract will not set up business here due to the prohibited electricity price,” Rodolfo B. Javellana Jr., president of United Filipino Consumers and Commuters (UFCC), said while pointing out that the effects of adjusting power rates to reasonable levels would be felt immediately in terms of more investments. Power rates in the country, said Javellana, are still among the highest in Asia and are a threat to the economic goals

Over 100-M Pinoys living in cities by 2050–World Bank

Over 100 million Filipinos or almost the entire country’s population today will be living in urban areas or cities in 2050, according to the World Bank. World Bank urban geographer Sarah Elizabeth Antos and consultant Yimin Zhou said 102 million Filipinos will live in cities—a figure that is estimated to be double the number today. The experts said in the Philippines, 70 percent of urban local government units (LGUs) are planning for smart cities to accommodate these Filipinos.

DOE TO CONDUCT GEA-3 THIS YEAR

The DOE will conduct the Third Round of the Green Energy Auction (GEA-3) this year as part of the Department's push for increased utilization of the country's renewable energy (RE) resources and attainment of energy security and reliability. The GEA-3 will specifically cater toNon-Feed-In-Tariff (Non-FIT) Eligible RE Technologies, i.e., Geothermal, Impounding Hydro and Pumped-Storage Hydro under Department Circular No. DC2023-10-0029 which provides specific auction policy and guidelines for these Non-FIT RE technologies in the Green Energy Auction Program. The GEA-3 will also include run-of-river (ROR) Hydro, which is a FIT-Eligible RE technology.