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Asia Inc.’s debt level is rising again, but that’s a good thing

THE financial gearing of Asia Pacific’s largest companies has risen for a second year following a period of deleveraging, but market participants don’t see cause for alarm.

The median total debt-to-total equity for non-financial companies in the MSCI Asia Pacific Index reached about 44% in the first nine months of 2019. That is slightly higher than the 41% seen in 2007, before the global financial crisis. Still, for many analysts, a low interest-rate environment, healthy cash balances and a favorable global economic outlook provide reassurance.

“We have a benign outlook for interest rates, and the big thing in 2020 is that governments in Asia will start using their country balance sheets to start stimulating the economy,” said Jim McCafferty, joint head of Nomura’s Asia-Pacific equity research.

Falling interest rates globally have meant access to cheap financing for companies that want to expand through investments and acquisitions, or fund share buybacks. According to Justin Tang, head of Asian research at advisory firm United First Partners, Asian corporates have increased their borrowings in recent months in order to invest in new projects as trade tensions ease.

Here are the companies with the highest leverage in the region. Firms domiciled in Macau, Thailand and the Philippines have the highest median debt-to-equity levels by country, while utilities dominated sectorally.

Analysts are confident that cash levels at companies in the region have improved over the past 12 years, providing enough buffer for balance sheets. In the first three quarters of 2019, firms loaded up on $2 trillion in cash and cash equivalents, three times the amount they had at the end of 2007.

PRODUCTIVE DEBT
Total debt, meanwhile, has more than doubled to about $6 trillion in the same period. Some observers say that limiting the use of debt purely to rein in gearing ratios may prove to be counterproductive for companies with healthy balance sheets. It’s not a good idea to forgo attractive projects and lose them to competitors just “for the sake of controlling your net gearing ratio,” said Felix Lam, who manages Asia Pacific equities at BNP Paribas Asset Management in Hong Kong.

In fact, gearing levels that are too low can be negative. Japan, which has undergone a long period of deleveraging since the bursting of its bubble economy in 1989, is a case in point. The country’s return on equity has “stagnated at a historically low level since the 1990s,” Oxford Economics said in a November report, “because financial leverage has declined, while the corporate sector’s saving surplus has persisted for two decades.”

And while leverage has risen for Asian companies overall, it is still far behind that of their American counterparts, with members of the S&P 500 Index clocking a median debt-to-equity of 92%.

OPTIMISTIC CAUTION
Current leverage levels may make some uneasy because higher debt is typically associated with vulnerability to economic downturn and increased risks for investors. But today, Asian companies are backed by economies with stronger balance sheets than during the global financial crisis, and recession fears have subsided in recent months because of positive data.

BNP Paribas’s Lam said he prefers companies with lower gearing and pays “extra attention” when analyzing the capital expenditure and cash generation by those that are highly leveraged.

“Increase in gearing ratios does mean that the risk and volatility rise over time for certain stocks, but that doesn’t mean that it’s a straight no-go or negative in terms of a company’s development in the next year,” Lam said. — Bloomberg

The Filipino banig: more than just decor

THE INITIAL idea was to use the 40 banigs — mats which had been woven in Basey, Samar — as gifts and room decor. It was the plan when Philippine Ambassador to Portugal Celia Anna M. Feria arrived in Lisbon in May 2017 to assume her post.

“I brought along with me about 40 pieces of Basey banig [mats] to Lisbon with the intention of giving them away as gifts, and also to use as decoration at the residence and at the Embassy, which I eventually did at the latter,” Ms. Feria told BusinessWorld in an e-mail last month. “I had thumbtacked about eight banig on the walls and on the bookcases in the Embassy’s conference room, while using the others are table highlights when we had Filipino food promotion activities outside the Embassy.”

Then Asian art and textile historians from the Center for Humanities at the University Nova de Lisboa (CHAM) — who frequently visited the embassy for meetings and to participate in various embassy activities — came up with the suggestion to hold an exhibition focusing on the traditional mats.

“I was very surprised at their proposal not thinking much of why they wanted a banig exhibit… Then it made me realize that what for me was ‘just a humble banig’ was in fact a work of art,” Ms. Feria wrote.

THE BASEY BANIG
It was after Super Typhoon Yolanda (international name: Haiyan) devastated the Visayas in 2013 that Ms. Feria began collecting mats in support of the community of women weavers in Basey, Western Samar which was one of the badly affected municipalities.

The municipality of Basey is known for its unique handwoven mats made using the leaves of the tikog, a reed grass with triangular stems which grows in vegetative wetlands.

“I knew the story behind the devastation of Basey as a result of Typhoon Yolanda in 2013, which made me order the banigs in the first place, as a way to help the community of women weavers and embroiders. But what I did not realize was that the banig mats spoke to these experts in a way it hadn’t to me,” Ms. Feria wrote.

In November 2019, the exhibition Banig: A Living Tradition of Mat Weaving for over 500 Years opened at the Fundaçāo Ricardo Espirito Santo Silva (FRESS), a decorative arts museum in Alfama, Lisbon.

The exhibit is meant “to promote the Philippine cultural identity and entrepreneurship in Portugal and to also commemorate the 500th Anniversary of the Circumnavigation of the World by the Magellan/Elcano expedition,” a press release explains.

Thirty-five of the ambassador’s personal banig collection are hung on the museum’s walls

For the exhibit, the 1525 manuscript Primo Viaggio Intorno ad Mondo by Italian chronicler Antonio Pigafetta was used to trace a historical connection around the mats.

Banig historian Elmer Nocheseda said that “the banig or Philippine mat played an important role in receiving Portuguese-born explorer Ferdinand Magellan by local chieftains” in the islands of Cebu in 1521. Mr. Nocheseda noted that on several occasions, Pigafetta cited that “Magellan ate, slept and was warmly received on the banig.”

“This made the entire project very interesting from a historical perspective. It meant that our banig weaving tradition pre-dates colonial Philippines,” Ms. Feria wrote for the exhibit.

Exhibit curator Albert Avellana noted that the selection of mats were chosen by the museum.

“Pagdating ko doon, first time ko nakita ’yung space. I had a preview (of the mats) through images pero doon ko lang nakita ’yung collection na pinili ng museum for the exhibit (When I arrived, it was my first time to see the space. I had a preview of the mats through images but I only saw the items from the collection chosen by the museum for the exhibit),” Mr. Avellana told BusinessWorld in an interview in December.

Mr. Avellana based the design of the space according to the type of banig designs based on the Mr. Nocheseda’s notes.

According to Nocheseda’s evaluation of Ms. Feria’s collection, the patterns include dahun-dahun, Nuhud-tuhud, Amakan, Maharlika, Pintados, Morado, and Bitig.

THE PORTUGUESE RECEPTION
Ms. Feria and Mr. Avellana observed that the Portuguese community was amazed that banigs are an integral part of Filipino culture. Ms. Feria explained to guests how Filipinos utilize the mats for sleeping, eating, playing, and decoration.

“Para sa atin (for us), the banig is [the] usual,” Mr. Avellana said. “[Sometimes] whatever is nearest you, hindi mo napapansin ang value (You do not notice the value).”

The exhibit will not be coming home to Manila, Ms. Feria said since there are more embroidered mats in the country that can be exhibited.

“My collection is limited to post-Yolanda Basey banigs and are relatively new. I am sure that there are more important banig collectors in the Philippines. What I can do is lend my collection to institutions in Europe who would like to borrow the collection for exhibition purposes,” she wrote.

In continuing to promote Philippine culture in Portugal, the embassy is currently working on a bibliography tracing the history of the Philippines and Portugal done in partnership with the Center for Humanities (CHAM) of the Universidade Nova de Lisboa. Researchers and historians are gathering documents and manuscripts that, Ms. Feria wrote, “will help us see our history from another perspective, thereby enriching our knowledge of our past.”

The exhibit runs until Jan. 6, 2020 at the Fundaçao Ricardo do Espirito Santo Silva (FRESS) located at Largo das Portas do Sol, 2 Lisbon, Portugal. — Michelle Anne P. Soliman

BSP approves report on banks’ intraday liquidity

THE BANGKO SENTRAL ng Pilipinas (BSP) will now require bigger lenders to report their intraday liquidity position as it looks to monitor its supervised institutions and their capacity to shoulder their day-to-day obligations with clients.

In a statement on Wednesday, the central bank said the policy-setting Monetary Board has approved the adoption of the report on intraday liquidity. Universal and commercial banks as well as their subsidiary thrift units and quasi-banks (QBs) will be required to submit the report which will include metrics consistent with international standards, including daily maximum intraday liquidity usage, intraday throughput, gross payments sent and received, and available intraday liquidity position, among others.

Covered lender are required to submit the report by end-June 2021.

“The monitoring of intraday liquidity position provides a tool to gauge the ability of covered banks and QBs to meet their intraday obligations on a timely basis, ultimately contributing to the smooth and efficient functioning of the payment and settlement systems,” the central bank said.

“Moreover, the submission of the report is expected to encourage covered banks/QBs to adopt a systematic and disciplined approach in managing their intraday liquidity. It will also enable the BSP to conduct a detailed analysis of the resilience of the covered banks/QBs to intraday liquidity shocks and monitor how intraday liquidity risk evolves over time,” the central bank added.

Meanwhile, stand-alone thrift banks and QBs, as well as rural banks, are exempt from the required reporting on intraday liquidity due to the lower volume of their payments and settlements.

“Instead, they are expected to maintain an adequate and reliable management information system that is able to measure and monitor selected intraday metrics,” the BSP said.

The guidelines for intraday reporting complete the central bank’s four-phased package of reforms on liquidity standards. Earlier phases were the issuance of guidelines on liquidity risk management; the adoption of the liquidity coverage ratio and the net stable funding ratio for big banks and their subsidiaries; and the imposition of a minimum liquidity ratio for stand-alone thrift and rural banks, respectively.

“The sequencing of these liquidity standards was deliberate and cognizant of domestic conditions and the potential impact on the banking system,” the BSP said. — L.W.T. Noble

Huawei’s 2019 revenues to jump 18%, forecasts ‘difficult’ 2020

SHANGHAI — Huawei Technologies on Tuesday said its full-year revenue would likely jump 18% in 2019 to 850 billion yuan ($121.72 billion), lower than its earlier projections, as a US trade blacklisting curbed growth and disrupted its ability to source key parts.

The world’s biggest maker of telecom network equipment and the No. 2 manufacturer of smartphones, was all but banned by the United States in May from doing business with US companies, preventing its access to technology like Google’s Android operating system.

The US government alleges Huawei equipment pose national security risks because they could be used by the Chinese government to spy on users. Huawei has repeatedly denied its products are a security threat.

Huawei’s Rotating Chairman Eric Xu revealed the numbers in a New Year’s message to employees and customers in which he also forecasted 2020 to be a “difficult year,” saying that the firm was unlikely to grow as rapidly as it did in the first half of this year.

Its estimate of 18% revenue growth in 2019 is less than 2018, when Huawei’s annual revenue rose 19.5%.

The company did not break down fourth-quarter figures but according to Reuters calculations based on its previous statements, revenue in the quarter to end Dec. 31 rose to 239.2 billion yuan ($23.28 billion), up 3.9% from a year earlier and slower than the 27% increase it reported in the third quarter.

“The external environment is becoming more complicated than ever, and downward pressure on the global economy has intensified,” he said.

“In the long term, the US government will continue to suppress the development of leading technology — a challenging environment for Huawei to survive and thrive.”

Xu also said that Huawei shipped 240 million smartphones in 2019, a 20% increase from 2018. Huawei has mainly sold smartphones that were launched before the ban.

The newest Mate 30 smartphone first went on sale in September but it cannot access a licensed version of Google’s Android operating system because of the trade curbs.

Xu said in his letter that Huawei would in 2020 “go all out” to build its Huawei Mobile Services ecosystem, which comprises services such as cloud storage and an app gallery, describing it as “the foundation of our ability to sell smart devices in markets outside China.”

It is also developing its own mobile operating system known as Harmony, although analysts are skeptical that the system is a viable alternative.

Huawei’s reputation was dented earlier last month after details of the dismissal and wrongful detention of a former employee went viral.

In his letter, Xu said they would continue to remove mediocre managers and complacent employees as Huawei needed to rid the company of complacency, and that they would remove managers performing in the bottom 10% every year. — Reuters

E-trike hailing app starts test run in UP Diliman

By Arjay L. Balinbin, Reporter

A MOBILE app-based electric tricycle (e-trike) ride-sharing system is currently being tested at the University of the Philippines (UP) Diliman, and will soon be deployed in Tuguegarao City.

The mobile app is called “Hatid,” said Lew Andrew R. Tria, an associate professor at UP Diliman’s Electrical and Electronics Engineering Institute. He also heads the Intelligent Electric Transportation Network (IntElect) project financed by the Department of Science and Technology (DoST).

The app, which was made available starting Dec. 9 to UP Diliman administrative personnel as “beta testers,” was developed as part of the IntElect project.

The IntElect is basically a network of electric vehicles and charging stations working together to reduce energy use in small communities such as UP-Diliman, Mr. Tria told BusinessWorld in a telephone interview on Dec. 12.

After the test run within the month, the system would be brought to a government center in Tuguegarao City, Cagayan Province. Government employees there should be able to book trips to locations within the area, similar to Grab and Angkas.

“The DoST chose the regional government center in Tuguegarao City as our partner. The Cagayan State University is also within that area,” Mr. Tria said.

“The IntElect project has three components. The first component is the hardware that includes the trikes and the charging infrastructure; second is the app with artificial intelligence (AI); and third is the deployment in Tuguegarao City,” he added.

The IntElect team, which consists of UP scientists and IT experts, is also looking at the business side of this newly developed system.

“If possible, we could commercially launch it here in Diliman,” Mr. Tria said, adding they will have to come up with a business plan before September 2020.

“We will see if we will launch it as a start-up or look for a third-party operator. We will look at the possible business models,” he said.

At present, there is one fast-charging station at UP Diliman for the 10 e-trike units donated by the Department of Energy (DoE) last June. It takes 30 minutes to fast-charge a five-passenger DoE e-trike model, which can run up to 60 kilometers. “If loaded, the range will be lower,” Mr. Tria said.

The IntElect team plans to set up four fast-charging stations at the regional government center in Tuguegarao City, which also received 10 e-trike units from the DoE.

Some of the units at UP Diliman may be sent to Tuguegarao City after the test run, Mr. Tria said.

In 2012, during the tenure of former President Benigno Simeon C. Aquino III, the National Economic and Development Authority Board approved the DoE-initiated e-trike project with the goal of encouraging energy efficiency and clean technology in the transportation sector.

The DoE partnered with the Asian Development Bank and the Clean Technology Fund to implement the project.

The project was initially designed for the use of local government units (LGUs); but because of their cost and the process involved in the procurement, LGUs were reluctant to buy the vehicles.

In 2017, current officials of the DoE decided to roll out 3,000 e-trikes out of the original 100,000, lowering the project cost to P1.73 billion from P21.672 billion.

Artist Eisa Jocson, winner of the Hugo Boss Asia Art Award, explores the body’s malleability

MERGING the past and present of Filipino culture through body movements is the focus of Filipino artist and 2019 Hugo Boss Asia Art awardee Eisa Jocson.

On Nov. 6, the Director of the Rockbund Art Museum (RAM) and Chair of the Hugo Boss Asia Art Jury Larys Frogier and Managing Director of Hugo Boss Greater China Jerome Bachasson, announced that Ms. Jocson was the recipient of the 2019 Hugo Boss Asia Art Award, chosen from among the shortlisted artists who included Hao Jingban (China), Hsu Che-Yu (Taiwan), and Thao-Nguyên Phan (Vietnam).

“The award to me is recognition of my practice that is somehow difficult to categorize or to grasp, somewhere between the visual arts and the contemporary dance. It also means bigger responsibility that comes with wider visibility and access to opportunities,” Ms. Jocson wrote in an e-mail to BusinessWorld.

Aside from the recognition, Ms. Jocson is also granted with a stipend of RMB 300,000 (P2,184,000).

The internationally renowned Hugo Boss Prize was established in 1996. In 2013, the Hugo Boss Asia Art Award was established to complement the Hugo Boss Prize. The Asia Art Award focuses on Asian contemporary art as a way for artists “to think, invent and represent the changes of Asia under globalization.” The award also serves as a curatorial practice and platform for theoretical research on inventive and collaborative projects.

“As a female artist conceiving stunning and always unexpected art projects from performance to sound and visual installations, Eisa Jocson has already a unique position in the contemporary art scenes in Asia and globally,” Mr. Frogier said in a press release. “The artist creates multilayered images, revisiting the vocabularies of dance and music, as well as infiltrating local popular references and contemporary visual art formats. It is with great intelligence that Eisa Jocson engages today’s life and art, always repositioning her own practice into the unknown, going beyond fixed identities, genders and frontiers.”

THE DANCER AND VISUAL ARTIST
Born and raised in Sta. Mesa, Manila, the 33-year-old artist started dancing ballet at age seven, and was exposed to the visual arts while assisting at the production studio of her aunt’s visual merchandising business located in their backyard.

“Alongside my ballet classes I was one of the star students in the arts classes. I chose to go to Philippine High School for the Arts, focusing on the Visual Arts, as I felt it was more expansive than the practice of ballet. Though for the first two years of high school, I still minored in ballet. In University I took up Sculpture but then was asked to shift course by my parents to Visual Communications (the other option that they gave me was Nursing),” she told BusinessWorld, adding that her aunt brought her along for pole dancing lessons during her last year at University.

Ms. Jocson said that her works are informed by her background in dance and visual arts.

“The visual arts and contemporary dance operate within different set of parameters (histories, conditions and locations), with this in mind I try to manifest the work that would best challenge the audience in each context,” Ms. Jocson wrote.

Currently exhibited at the Rockbund Art Museum, Ms. Jocson’s works explore the malleability of the human body.

The karaoke video titled Super Woman KTV (2019) features a combination of performances inspired by folk rituals, oral traditions, and contemporary pop songs. Ms. Jocson studies the cultural meanings found in popular songs in the Filipino culture and finds that it represents “collective notions of femininity for different generations in the Philippines.” The ongoing project aims to create a contemporary adaptation influenced from precolonial rituals.

Corponomy (2019) is an intertextual installation of dance sequences, karaoke videos, and live performances by her own troupe. Ms. Jocson put together a wide repertoire of genres centering on overseas Filipino workers in the entertainment and service industries. It features pole dancing, macho dancing, female hostesses, and Disney princesses. The word “corponomy” was used “to describe the body as it adapts to different economic situations, as well as the dynamic relationship between marginalized communities and mass culture.”

“I see the body as malleable material sculpted by its history, conditions and location. Filipinos are known to service the world in various roles, from domestic worker, entertainer, nurse, seaman, musician, teacher etc. Labor force that uses affective labor (care) as the primary skill,” Ms. Jocson wrote. “I want the wider audience to encounter the complexities of the Filipino condition and how much care work is undervalued and exploited by the capitalist system.”

“[Eisa] Jocson’s performances evolved into a stage in the main area with a backstage to show different aspects of her performance and ways for the audience to situate themselves with her work from past to present,” Senior Curator of Rockbund Art Museum Billy Tang told BusinessWorld in an e-mail.

In the exhibit, Mr. Tang noted that all the artists are engaged with various techniques on moving-image.

“[For me], the most interesting way to read this is to try to understand how each artist uses moving-image as a medium to think and explore — and how many of the artists use moving-image as a device to play off and create new forms of dramaturgy within the context of the viewer and their relationship to the space,” he explained.

Ms. Jocson has recently started working on Manila Zoo — the third part of her Happyland Series — set to open in Frankfurt in April 2021. The exhibition “proposes humans performing the labor of animals in the zoo.”

“I’m interested in further pushing the malleability of the laboring-performing body and to go deep into human-animal relations,” she wrote.

The Hugo Boss Asia Art Award is open to artists under the age 35 who are working primarily in or born in Greater China (Mainland China, Hong Kong, Macau, Taiwan) and/or Southeast Asia, as well as have produced an outstanding project or solo exhibition of critical significance.

The exhibition of the four finalists’ works runs until Jan. 5 at the Rockbund Art Museum in Shanghai, China. Guests may try the augmented reality guided tour with the curator on mobile devices. For information, visit hugobossasiaart.org/en/ — Michelle Anne P. Soliman

‘Majority’ of nonlife insurers likely failed to meet end-2019 capital hike

THE INSURANCE Commission (IC) said “majority” of nonlife insurance companies are still working to meet the higher minimum capital requirement that took effect at end-2019, while only “a couple” of life insurers have not yet reached the prerequisite, its top official said.

IC Chief Dennis B. Funa told BusinessWorld that they will know this quarter the exact number of firms that are compliant with the end-2019 minimum net worth requirement when firms submit their financial statements for the year.

Republic Act No. 10607 states that insurance companies are required to maintain at least P900 million worth of capital requirement by the end of 2019, up from the P550-million requirement previously.

This will increase further to P1.3 billion by end-2022.

“For the nonlife (insurance companies), a majority are still in the process of complying. I cannot give an exact figure because it will send a wrong signal to the industry. We will know in the first quarter of [this] year the definite number,” Mr. Funa said in a phone message last week.

He said individual reports from life insurers showed several firms are already compliant with the higher solvency requirement.

“Only about a couple are still noncompliant for the life insurers,” he said.

Meanwhile, there will be insurance companies that will merge to meet the minimum capital requirement but those will be formally announced by the companies themselves, according to Mr. Funa.

Currently, there are 31 life and 55 nonlife insurance companies operating in the country.

So far, he said only the multinational, digital-only life insurance company Singapore Life Private Ltd. (Singlife) will be entering the market this year.

Singlife Philippines CEO Rien Hermans had said they will be operating and launching their products at the start of 2020.

Mr. Hermans also said they are equipped to comply with the minimum paid-up capital requirement worth P1 billion for new insurance firms entering the market.

In an earlier interview, Mr. Funa said Singlife Philippines will be the first in the local market to use a primarily digital platform for its business operations. — Beatrice M. Laforga

Wela Online looking to expand market, products

MINDANAO-BASED tech-startup Wela Online Corp. is eyeing to expand its market and diversify its products by 2021.

“‘Yung goal namin (Our goal) is to saturate the market first in the Philippines, then hopefully… two years from now, we can maybe expand to other Southeast Asian countries, and then that is the time we can diversify,” Wela Chief Technology Officer John Vincent Fiel said in an interview.

Established in 2016, Wela is a startup based in Cagayan de Oro. It is supported and funded by Ideaspace Foundation, Asian Institute of Management and Department of Science and Technology Philippine Council for Industry, Energy and Emerging Technology Research and Development (DOST-PCIEERD). The company is an integrated school management system that streamlines data management, especially in terms of grading system and cashless payments, and connects parents to the school through its mobile application. It has partner schools mostly in Mindanao, and some in Luzon.

The company announced on Dec. 7 that it has teamed up with Japan-based technology firm Leave a Nest Co., Ltd. to improve both countries’ education system through better technology.

Leave a Nest is a group of researchers founded by a group of 15 graduate students from the field of Science and Engineering in 2001. Since 2017, it has been participating in enhancing the Philippines’ innovation community through its annual program Tech Planter, which looks for scientists, researchers, and businessmen in the field.

Leave a Nest will also bring the Wela team to Tokyo, Japan to look into schools there and come up with ways on how to improve how schools manage their operations.

“They offered an investment…but last year we were not open for an investment yet, so this year kami nag-continue sa (we pushed through with the) partnership. This time, to proceed with our partnership, next year march our team will be travelling to Tokyo, Japan,” he said.

“One of our objectives is to study the schools to see how we can help. We will also visit their partner companies, also, that are related to education technology. Basically, they help us, we help them also,” he explained.

With this partnership, Mr. Fiel said the company will be focusing on developing its products for schools while also considering to widen its reach to companies.

“Right now we are focused in schools, but we are looking at a possibility of integrating it to companies, so that could be another phase for us,” he said.

On extending its reach to other countries, he said Japan may be the first market it is entering to given the connection it was able to establish with Leave a Nest.

“We will see… From there we can probably assess kung anong (what) project or product we can provide to them,” he said. — Vincent Mariel P. Galang

Philippine Pavilion to showcase creative industry

By Jenina P. Ibañez

DUBAI — Philippine participation in international trade fairs is usually the work of small businesses, touting banana chips and coconut oil for possible export. But participation in the world’s fair — a six-month international exhibition to showcase “the achievements of nations” — means a different kind of export: creativity.

“The pavilion also would feature the most comprehensive, unique representation of the Philippine creative industry. We’ve been pushing for creative industry more,” Trade Secretary Ramon M. Lopez said at the media launch of the Dubai 2020 World Expo on Thursday.

The Philippines is spending an estimated P800 million on the construction, maintenance, promotion, events, and run of a pavilion showcasing Philippine creativity for the 192-nation expo in Dubai. The expo is expected to attract 25 million visitors.

“[The creative sector] is really an important competitive edge for Filipinos and the Philippines. This is one area where, without any effort from government, creative industry and services would account for one half of what the performance for goods export would be,” Mr. Lopez said.

The Trade chief noted that annual export for goods accounts for $65-70 billion.

“Without any help, the creative industry is making about $40 billion,” he said.

According to the Expo press materials, the Philippine pavilion will be presenting arts and design, architecture, animation, comics, gastronomy, music, photography, film, fashion, and advertising.

Curator Marian Pastor-Roces described sculptures, photographs, and designs that will be displayed in the pavilion, which would collectively tell the pre-colonial and modern story of Filipinos, as well as showcase the country’s natural beauty.

“We have put together the scientific data about the Philippines from archeology, linguistics, anthropology, a little bit of history… and present it to update the story of the Filipino,” she said.

Export promotion is not the main goal of the expo. Mr. Lopez said it is about “image-promotion,” which could also attract tourism and business investment.

The Philippines previously participated in World Expos in Shanghai in 2010 and Yeosu, South Korea in 2012. Mr. Lopez said that the country is returning to the World Expo next year as it is being held in the United Arab Emirates, where more than 700,000 Filipinos live and work.

“With 190-plus countries participating. It’s harder to explain if you’re not part of this. You really have to be part of this,” he said.

Ms. Pastor-Roces wants to use the pavilion as a means to show Philippine creativity to an international audience.

“We also want those people who are in the creative industries to know that they do belong in a global community of creative people,” she said.

The Department of Trade and Industry said that the Philippines aims to be a top creative economy in the Association of Southeast Asian Nations (ASEAN) in terms of size and value by 2030.

The policy recommendations in the department’s road map include declaring creativity as a national priority through an executive order, the creation of a creative economy agency, incentivizing the development of creative hubs, and promoting creative tourism.

The creative industry includes animation, film, advertising, game development, and graphic design, among many others.

Architect Royal L. Pineda, whose agency won the bid to design the pavilion, said that they used “practical luxury” in design. This means they focused on creative design while using cheaper materials and working with local UAE contractors and technologies.

Budji + Pineda Architecture + Design recently received an inquiry from the Solomon Islands to apply “practical luxury” design for their athletic stadium for the Pan-Pacific Games. After the agency presented the Philippine pavilion, South Africa asked the agency to present a design for their own pavilion.

Mr. Pineda hopes for more collaboration among Philippine creativity, culture, and nature with international technologies.

“We believe that anything that we need to do as people should really start with the mind. That’s why when we were asked to talk about sustainability, we talked about cultural sustainability,” he said.

Bruce Lee’s daughter sues Chinese fast food chain

SHANGHAI — A firm run by the daughter of Bruce Lee has sued a Chinese fast food restaurant chain for using the late kung fu star’s image in its logo without permission and is seeking over 210 million yuan ($30 million) in compensation, Chinese media outlet The Paper reported.

California-based Bruce Lee Enterprises, whose head is Shannon Lee, filed the case against the Real Kungfu chain in a Shanghai court on Dec. 25, requesting that the food firm stop using the image and pay an additional 88,000 yuan to cover legal expenses.

It also asked that the Guangzhou-based chain to issue clarifications for 90 days to say that it has nothing to do with Bruce Lee. Real Kungfu, which sells rice bowls with Chinese dishes, was founded in 1990 and has outlets in over 57 Chinese cities.

Its logo is of a man dressed in a yellow long-sleeved top whose looks and stance are similar to Bruce Lee and his famed “ready to strike” pose.

Real Kungfu on its Weibo account on Dec. 26 said it was “puzzled” by the lawsuit as it had used that logo for the last 15 years. It said that while there had been some issues in the past, its use of the logo was approved by national authorities.

The filing of the case comes as China has pledged to improve protection for intellectual property rights and apply stiffer penalties, one of the key topics in Beijing’s trade dispute with the United States. — Reuters

Bitcoin’s 9,000,000% rise leaves the skeptics aghast

BITCOIN was slow to break through, but eventually became a top asset. — PIXABAY.COM

IF IN THE throes of this bull market’s earliest stages of recovery someone told you to forgo stocks, forget commodities, renounce fixed-income assets and buy an unknown digital token, the first of its kind, and watch it grow beyond your wildest dreams, you’d call them crazy, right?

Emerging out of the ashes of the financial crisis, Bitcoin was created as a bypass to the banks and government agencies mired in Wall Street’s greatest calamity in decades. At first, it was slow to break through, muddied by a slew of scandals: fraud, thefts and scams that turned away many and brought closer regulatory scrutiny. But once it burst into the mainstream, it proved to be the decade’s best-performing asset.

The largest digital token, trading around $7,200, has posted gains of more than 9,000,000% since July 2010, according to data compiled by Bloomberg.

“Bitcoin really captured that wild technology enthusiasm that ‘this time is different,’” said Peter Atwater, the president of Financial Insyghts and an adjunct professor at William & Mary in Williamsburg, Virginia.

The performance over the past 10 years, even with its huge run-up and subsequent mega-crash, leaves all others in the dust. It’s a massive windfall for those who HODL’ed through its ups and downs, even as it continues to provide fodder for get-rich-quick schemes. For some, the never-ending fantasy of continually hitting that payoff still helps to keep Bitcoin’s momentum going.

Nothing else comes even close to beating it. The S&P 500 merely tripled in that period. An index that tracks world markets has more than doubled. Gold is up 25%. Some of the best-performing stocks in the Russell 3000 — including Exact Sciences Corp. and Intelligent Systems Corp. — are each up about 3,000%. Those gains pale in comparison to the finance world’s latest — and one of its most controversial — marvels.

Partly, the monster return is a reflection of the calculus behind Bitcoin’s jumping-off point: the token wasn’t worth anything when someone named Satoshi Nakamoto launched it on Halloween 2008. Designed as a method of exchange that can be sent electronically between users around the world, it did not have a centralized control network. Bitcoin, instead, is run by a network of computers that keep track of all transactions on the blockchain ledger. For many, that technology was reason enough to buy into the idea.

On the other side of the equation are Bitcoin’s devoted enthusiasts who saw in its technology a promising way to change the global financial system.

“This is the first time that there’s a real separation — just like church and state — you have a separation of money and state,” said Alex Mashinsky, founder of Celsius Network, a crypto lending platform. “That’s the innovation, that’s the excitement.”

But Bitcoin was slow to take off, notching its first transaction two years after its creation, when someone used it to buy pizza. Since then, the first-born token’s price has catapulted, doubling many times over, and hundreds of imitators have cropped up — some with more success than others.

Many of those who got in early stayed faithful, watching as it made its way through a boom and bust cycle unrivaled by almost anything else over the last decade.

At the beginning of 2017, Bitcoin jumped above $1,000. By mid-summer, it had more than doubled. Insanity was unleashed. By yearend, it hovered above $14,000. But as swiftly as it ran up, it fell even faster. By the end of 2018, Bitcoin barely budged above $3,000. Yet shortly after its crash, it embarked on another huge rally, this time reaching as high as $13,800 in the summer of 2019.

“Certainly the numbers are what appeals to investors,” said David Tawil, president of ProChain Capital. “The next 10 years need to be a totally different stage of growth based on totally different factors than the first stage.”

As much as it’s made a fortune for speculators and some thieves, Bitcoin’s survival will rest on further adoption. It’s not being used as a widespread medium of exchange. A few large retailers are accepting payment in Bitcoin but it hasn’t been the large-scale embrace so many had predicted. Scams are still running rampant. Interest is waning and consolidation among large owners is at a higher level than it was during the height of the 2017 bubble, which means that their influence over prices could be increasing.

Projections for the next decade abound. In the 2020s, mass adoption is surely to take off, they say. Blockchain technology will revolutionize and solve every problem in the world. On the other hand, regulatory scrutiny is likely to intensify, with central bankers paying closer attention than ever before.

In the more immediate term, some speculators forecast 2020 might be less fraught with volatility given its upcoming halving, whereby the number of coins awarded to so-called miners who process transactions is cut by 50%. That’s set to happen in May 2020 (the internet is replete with countdown clocks). The coin’s previous cut, about four years ago, coincided with a run-up in its price, pushing many crypto evangelist to believe in a repeat.

To CoinList’s Andy Bromberg, the halving is already priced in. “Maybe it’s been overpriced in and everyone’s bought into this thesis and we see a dip post-halving,” said the firm’s co-founder and president in an interview. “That would not shock me.

But beyond this year, “Bitcoin is finding its own narrative as digital gold,” he said. “It feels like that narrative is picking up steam and it’s breaking away on its own. I would define success for most crypto assets as doing exactly that.” — Bloomberg

Russian competition watchdog opens investigation into Booking.com

MOSCOW — Russia’s Federal Anti-monopoly Service (FAS) has opened an investigation into hotel reservation website Booking.com, the regulator said on Monday.

The FAS said that the company had asked hotels and hostels to offer the same prices on rival reservation websites as on Booking.com.

Booking.com did not immediately respond to a request for comment.

If found to be in breach of Russian anti-monopoly laws the company could face a fine of between 1% and 15% of its revenue generated in Russia.

The Russian investigation follows a case against the company in the European Union, where it last week committed to bring its practices in line with EU consumer law. — Reuters

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