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December inflation slowest in seven months

Economic managers noted that slower price increases for transportation, food and non-alcoholic beverages softened annual inflation for the second straight month in December.

By Carmina Angelica V. Olano, Researcher
THE OVERALL year-on-year increase in prices of widely used goods eased for the second straight month in December by its slowest pace in seven months, the Philippine Statistics Authority reported on Friday, giving the central bank room to consider the impact of its next monetary policy moves on economic growth.
Headline inflation eased to 5.1% last month, marking the slowest pace since May’s 4.6% though still much faster than the year-ago 2.9%.
Inflation had picked up for nine straight months to a nine-year-high 6.7% in September that was sustained in October before dropping to six percent in November.
The latest inflation pace is lower than the 5.7% median in a BusinessWorld poll late last week and falls below the 5.2-6% estimate given by the Bangko Sentral ng Pilipinas (BSP) for last month.
Full-year inflation came in at 5.2% against the central bank’s 2-4% target range for 2018 and was the fastest in a decade, or since 2008’s 8.2%.
Stripping out volatile prices of energy and food, core inflation clocked 4.7% in December, slower than November’s 5.1%, fueling a 4.2% average for 2018.
COMPONENTS
In a press briefing on Friday, National Statistician Lisa Grace S. Bersales noted “slowdowns” in year-on-year price increases of food and non-alcoholic drinks which eased to 6.7% in December from eight percent in November as well as for transport — to four percent from 8.9%.
Food-alone inflation moderated across the board, except for the “other cereals, flour, cereal preparation, bread, pasta and other bakery products” category that picked up to 4.1% last month from 3.9% in November. Increases in rice prices slowed to six percent in December from 8.1% in November, while increments in fish prices slowed to 9.9% from 12.5%; meat, 5.5% from 6.3%; and vegetables, 8.1% from 11.5%.
Increases in transport costs similarly eased to four percent from November’s 8.9%.
Reflecting a reduction in price pressures was the monthly picture, with inflation rate dropping 0.59% in December, bigger than November’s 0.17% drop after successive month-on-month increases since 2018 began.
RISKS AHEAD
“Those are negative inflation rates that should tell us that, indeed, the supply-driven inflation process we saw in 2018 was not to be persistent and, therefore, short-lived,” BSP Deputy Governor and Officer-in-Charge Diwa C. Guinigundo said in a mobile phone message to reporters, citing the impact of the central bank’s five successive increases in benchmark inflation rates by a total of 175 basis points from May to November as well as the Executive branch’s non-monetary steps to remove food supply bottlenecks.
“With lower price movement, we could be optimistic about growth prospects and their positive feedback to inflation,” Mr. Guinigundo said, citing BSP forecasts of 3.2% and 3.0% for 2019 and 2020 inflation that will return overall prices increases to the central bank’s 2-4% target band.
“We shall continue to confront the issue of inflation with appropriate, vigilant stance of monetary policy in recognition of the remaining risks both here and abroad, without losing sight of the requirements of economic growth.”
The National Economic and Development Authority, the Department of Finance and the Department of Budget and Management noted in a joint statement that “[t]he rate of price increases has remained manageable, giving the country adequate elbow room to sustain its economic growth and reach its development goals”.
“Still, we understand that the faster inflation, particularly in the middle of 2018, had affected many Filipinos, most especially those in the disadvantaged sectors,” they said.
“While we can say that the worst seems to be over — given signs of easing price pressures — we continue to be vigilant of possible risks,” the departments added, saying that “[e]nsuring sufficient supply of rice and of other major agricultural products from local sources remains crucial… with the looming El Niño phenomenon in 2019.”
INFLATION STILL FASTER IN MANY REGIONS
In Metro Manila, inflation slowed to 4.8% last month from 5.6% in November, while overall price hikes similarly eased to 5.3% — still above the national rate — from 6.2% in areas outside the National Capital Region, PSA data showed further.
While PSA noted that the increases in prices of widely used goods slowed across much of the country, the rate was still above the national pace in 11 of the country’s 17 regions, namely: the Autonomous Region in Muslim Mindanao (7.5%), Ilocos Region (7.0%), Bicol Region (7.0%), MIMAROPA (6.7%), Zamboanga Peninsula (6.6%), Cagayan Valley (6.0%), Western Visayas (5.7%), Northern Mindanao (5.7%), SOCCSKARGEN (5.6%), Central Visayas (5.3%) and Davao Region (5.3%).
ANALYST EXPECTATIONS
For Michael L. Ricafort, economist at Rizal Commercial Banking Corp.(RCBC), “Inflation could ease/decline further in January 2019 to four-percent levels, despite the scheduled increase in fuel excise taxes of about P2 per liter for gasoline and diesel, partly due to sharply lower oil/fuel prices, easing of rice/food prices, relatively stronger peso.”
“[T]he higher base/denominator effects for inflation starting January 2019 (after TRAIN law took effect in January 2018) would result to lower year-on-year inflation rate in the coming months of 2019,” Mr. Ricafort added, referring to Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion Act (TRAIN), that slashed personal income tax rates but either increased or added taxes on a host of items when it took effect a year ago.
For Nicholas Antonio T. Mapa, senior economist at the ING Bank NV Manila, “[W]e will be revising lower our inflation outlook for both 2019 and 2020”.
“With more imported grains currently on delivery over the next few weeks, the rice tariffication bill set for signing and energy prices depressed, risks to the inflation outlook appear tilted to the downside and expectations now more anchored,” he added, referring to an impending law now for signing by President Rodrigo R. Duterte that will replace the current import quota scheme for rice with a regular tariff that, in turn, is expected to slash retail prices of the staple by P7 per kilogram and headline inflation by 0.7-0.8 percentage point.
“With the stars aligning for decelerating inflation, a more dovish Fed [in the face of mounting macroeconomic uncertainty for the United States] and possibly slowing growth momentum, the chances for a BSP two-pronged easing in the first half of 2019 has increased significantly.”
The BSP’s Monetary Board is scheduled to meet for its first policy review this year on Feb. 7.

Factory output growth slows for fourth straight month

assembly line (fruits)
‘We… expect that election-related spending will drive up manufacturing, particularly production of food, beverage, tobacco, printing and paper products.’ — Socioeconomic Planning Secretary Ernesto M. Pernia

By Mark T. Amoguis, Researcher
MANUFACTURING growth decelerated for the fourth consecutive month in November to its slowest pace so far in 2018, even as it was better than the year-ago contraction, the Philippine Statistical Authority reported on Friday (PSA).
Preliminary results of PSA’s latest Monthly Integrated Survey of Selected Industries, showed factory output — as measured by volume of production index — increased by 1.0% year-on-year in November, slower than October’s revised 3.6% though still a turnaround from past year’s 10.1% decline.
Factory output volume growth averaged 10.1% as of November, better than the nearly flat 0.8% recorded in past year’s comparative 11 months.
In comparison, the Nikkei Philippines Manufacturing Purchasing Managers’ Index (PMI) improved to 54.2 in November from October’s 54, but lower than last year’s 54.8, signaling “notable improvement” in the manufacturing sector’s health. A PMI reading above 50 signals improvement in business conditions from the preceding month, while a score below that point indicates deterioration.
Average capacity utilization — the extent by which industry resources are used in the production of goods — was estimated at 84.3% in November. Eleven of the 20 sectors registered capacity utilization rates of at least 80%.
According to the National Economic and Development Authority (NEDA), the uptick in production in November was supported by increases in textile (45.8% that month compared to 42.4% in October), miscellaneous manufactures (25.6% from 31.2%), petroleum (22.0% from 45.3%), tobacco (21.1% from -8.6%), paper products (15.0% from 11.4%), beverages (11.7 from 6.1%) and electrical machinery (11.0% from 17.0%).
Declines, however, were noted in printing (-71.6%), food manufacturing (-18.3%), machinery except electrical (-14.5%), leather products (-8.4%), footwear and wearing apparel (-4.4%) as well as chemical products (-2.2%).
“While the November outturn of sustained positive growth for manufacturing, indices showed a declining trend starting on the second half of 2018,” Socioeconomic Planning Secretary Ernesto M. Pernia was quoted as saying in the NEDA statement.
Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc. (UnionBank), said that textiles industry propped November’s production growth. “This noted increase may have been prompted by increasing consumer demand due to Christmas spending. Compared to the same period last year, this is a huge improvement,” he said.
Mr. Asuncion said the overall slowdown in factory output was to be expected because orders for December are usually placed six months earlier and growth tapers off towards yearend.
NEDA said in its statement that reduced optimism among businesses and worsened consumer pessimism, as reflected in the central bank’s fourth-quarter surveys, likely weighed on manufacturing in those three months, and UnionBank’s Mr. Asuncion said he expects factory output growth to have slowed further in December.
Still, the coming months should see “moderate” inflationary pressures — particularly in cost of inputs — spurring production expansion, the NEDA said.
“We also expect that election-related spending will drive up manufacturing, particularly production of food, beverage, tobacco, printing and paper products,” said Mr. Pernia, who heads NEDA as director-general.
For Mr. Asuncion, factory output growth in “January will start to pick up as historical data dictates.”
“I expect 2019 to be more robust than 2018 as heightened inflation starts tapering off throughout 2019,” he said.

Piñol orders sacking of NAIA quarantine team amid threat of African Swine Fever

By Reicelene Joy N. Ignacio
DEPARTMENT of Agriculture (DA) Secretary Emmanuel F. Piñol ordered on Friday the sacking of quarantine team of the Ninoy Aquino International Airport (NAIA) after their failure to establish quarantine measures on the entry of pork products from countries affected by African Swine Fever (ASF).
“The directive was for all quarantine stations to establish footbaths in all entry points of the country, the interception and confiscation of all pork-based products,” Mr. Piñol said in his Facebook post.
Mr. Piñol cited a report quoting Samahang Industriya ng Agrikultura (SINAG) Chairperson Rosendo O. So as saying there were no quarantine procedures observed at NAIA. The DA chief then confirmed the report with Bureau of Animal Industry (BAI) Officer-in-Charge and Director Ronnie D. Domingo.
“Dr. Domingo admitted that the NAIA Quarantine Group failed to establish the footbath facility ‘because of procurement issues’ and it was the only station which failed to implement the directives,” Mr. Piñol said, adding that the quarantine team will be released effective 5:00 p.m. of Jan. 4, Friday.
Pork products have been banned here from 13 countries: China, Hungary, Belgium, Latvia, Poland, Romania, Russia, Ukraine, Bulgaria, Czech Republic, Moldova, South Africa and Zambia. DA issued the first ban on June 27 last year, particularly on pork products from Hungary.
On Dec. 28, DA issued a memorandum order requiring the establishment of footbaths in all entry points of the country and a mandatory inspection of vessels docking in Philippine ports with meat supplies, including cruise ships and fishing boats with meat products from China.
The order also required close coordination with the Bureau of Customs and confiscation and destruction of all pork products within 24 hours coming from China and other countries affected by ASF.
Mr. Piñol appealed to consumers to patronize locally produced pork and pork products, especially in the face of the ASF threat.
“The threat is real and it could affect an industry which benefits millions of families, mostly small backyard farmers who raise 15 million heads of hogs every year,” he said.
“Better still, source your requirements locally. That way, you do not only protect our local hog industry but you also help lower poverty in the countryside. Remember that if you buy local, you not only help the hog farmers but also the corn, sorghum, coconut and cassava farmers, who produce the materials for local feeds,” Mr. Piñol added.

PNP: Hitman in Batocabe murder surrenders

THE Philippine National Police (PNP) on Friday confirmed the arrest of Henry Yuson, the alleged hitman behind the DEc. 22 assassination of Ako Bicol Rep. Rodel M. Batocabe.
“With the arrest of the main gunman, this will further tighten the noose around the necks of the suspects,” PNP Chief Director-General Oscar D. Albayalde said in a televised press briefing, Friday.
Mr. Albayalde said Mr. Yuson had surrendered to the authorities, but was arrested in connection with a pending rape case.
“He surrendered to the Army, the 903rd but he was arrested because we served a warrant of arrest against him for the crime of rape,” Mr. Albayalde said.
Mr. Yuson was identified as a former New People’s Army rebel. Mr. Albayalde also reported that Jaywin Babor, who was designated in charge of the getaway motorcycle, had likewise surrendered and is now in police custody.
“May additional pa just this morning, at 10 am, the IG (Intelligence Group) of the PNP took custody of Jaywin Babor who is allegedly the driver of another one getaway motorycle used during the assassination of Congressman Batocabe and SPO2 Diaz,” the PNP chief said.
Mr. Albayalde said the suspects surrendered following a conflict over the P5-million pay for the hit job. “Pareho sinasabi nila na hindi tumupad sa usapan doon sa pera. May usapang problema sa pera so ito halos pare-pareho sinasabi nila,” he said. (They all say a promise was broken regarding the payment. There was a problem about the money so this is what they practically all say.)
The PNP had earlier tagged Mayor Carlwyn G. Baldo of Daraga, Albay, as the mastermind in Mr. Batocabe’s murder. Also implicated by the police were Christopher C. Naval, Danilo Muella, Rolando Arimado, and Emmanuel Rosello.
Mr. Batocabe and his police escort SPO2 Orlando Diaz were gunned down during a gift-giving activity in Daraga. He had earlier announced he was seeking the mayoralty in this year’s midterm elections.
Mr. Baldo, in a press briefing on Thursday afternoon, following his implication by the police, asserted his innocence.
For her part, House Speaker Gloria Macapagal-Arroyo sought the prosecution of Mr. Baldo and others tagged by the police.
“Now that the mastermind and all his co-conspirators have been identified, our law enforcement agencies must ensure that they be prosecuted to the fullest extent of the law,” she said in a statement on Friday. — Charmaine A. Tadalan

Duterte considering road user’s tax for disaster relief in Bicol

By Camile A. Aguinaldo, Reporter
PRESIDENT Rodrigo R. Duterte wants to use the road user’s tax collected by the Road Board to fund infrastructure and flood control projects aimed at improving Bicol region’s preparedness against disasters.
“I strongly recommended the abolition of the road tax. It’s really a milking cow for corruption. Maybe it will be continued. Maybe the money can be used here,” he said in a situation briefing on the aftermath of Typhoon Usman in the Bicol region.
“I’ll commit to you that the very first project that will be undertaken under that fund, if it’s transferred to DPWH (Department of Public Works and Highways) or to agriculture, I’m okay with it. We’ll start with (Bicol),” he added.
The measure that would abolish the Road Board remained pending in Congress following the conflicting positions of both chambers of Congress on this matter.
The bill also seeks to transfer the road user’s tax, also known as the motor vehicle user’s charge (MVUC), to be remitted directly to the National Treasury and to be appropriated for projects of the DPWH, Department of Environment and Natural Resources (DENR), and Department of Transportation (DoTr).
He also said he will talk to Senate President Vicente C. Sotto III and House Speaker Gloria M. Arroyo on the matter.
For his part, Albay Rep. Joey S. Salceda, who was also present in the situation briefing, said, “The road tax has an economic philosophy. It’s supposed to provide continuous funding of maintenance in order to prolong the life of our roads. If we shift it to another purpose, we have to continuously seek and compete for other funds within the GAA (General Appropriations Act) framework….We should dedicate it (to) road maintenance, Mr. President.”
Mr. Duterte floated the idea after raising concerns of persistent flooding in the region. He also backed the proposal of Interior Secretary Eduardo M. Año and Office of Civil Defense Undersecretary Ricardo B. Jalad to construct permanent evacuation centers in the localities.
“Every typhoon, calamity that would need evacuation of people, the public schools really suffer. And it causes aberration in the schooling of children. In the matter of building some structures to accommodate evacuees, maybe General (Eduardo D.) Del Rosario (of the Housing and Urban Development Coordinating Council) can give us a blueprint of that… You can go around and study… It can only be used for evacuation purposes and keep people safe,” Mr. Duterte said.
Mr. Año also proposed a long-term program that would relocate families living in landslide prone-areas in response to the government’s findings that landslides largely caused many casualties during typhoons.
Department of Science and Technology (DoST) Undersecretary for Disaster Risk Reduction and Climate Change Renato U. Solidum, Jr. also noted that while climate change played a role, the frequency of landslides was also caused by roads made from erodable materials.
“Another concern of government is to make sure that the roads that we developed would have ample slope protection, second, also drainage, and thir,d prohibit those who build houses near the roads (in the mountains),” he said.
Camarines Sur Rep. Luis Raymund F. Villafuerte, Jr. also suggested that the national government dredge the Bicol River to solve or to minimize floodings in the area.
For his part, Agriculture Secretary Emmanuel F. Piñol called for a review of all the country’s major river systems.
DPWH Undersecretary Rafael C. Yabut said the DPWH, Department of Environment and Resources (DENR) and NEDA (National Economic and Development Authority) are planning to update the World Bank’s Bicol River Basin Development Feasibility Study, which was first introduced in 2003.
“We bid out the consultancy for this preparation of the masterplan and revisit…the Bicol River Basin as mentioned by Congressman Villafuerte. And hopefully, we will able to award next the revisit of the master plan,” he said.
Before the briefing, Mr. Duterte conducted an aerial inspection of the damage caused by the typhoon in the Bicol region.
According to a report by Mr. Jalad, the total death toll of the typhoon climbed up to 122, with 28 missing, and 60 others injured as of Jan. 3.
Mr. Piñol also reported that the estimated damage to agriculture totaled P801 million as of Jan. 3, with more than 37,000 affected farming and fisherfolk families.
Agriculture production loss is also estimated at 18,763 metric tons, with rice fields largely affected.
Meanwhile, Mr. Duterte’s hometown of Davao City is set to send P10 million worth of cash and relief goods, as approved by the city council, to areas declared under a state of calamity following Typhoon Usman.
“The P10 million will come from the QRF (Quick Response Fund),” City Disaster Risk Reduction Management Council (CDRRMO) Chief Alfredo Baluran said in a statement.
The city has a P130.8 million QRF for 2019, which can be used for disasters in the city and to provide aid to other local government units.
Mr. Baluran said each of the provinces of Oriental Mindoro, Sorsogon, Albay, Camarines Sur, and Camarines Norte will receive P1 million in cash assistance.
The remaining P5 million will be given in the form of cash or relief goods to flood and landslide victims who are still in the evacuation centers. He also said the city may release more assistance depending on the final assessment of the storm’s impact. — with a report by Carmencita A. Carillo

Officials call for calm in Cotabato City in run-up to BOL plebiscite

By Marifi S. Jara, Mindanao Bureau Chief
SECURITY and peace process leaders met with local officials Thursday afternoon to ease rising tension in Cotabato City in the aftermath of the Dec. 31 bombing and the run-up to the Bangsamoro Organic Law (BOL) plebiscite on Jan. 21.
“We are here to defuse the tensions and we don’t want to escalate the conflict,” Defense Secretary Delfin N. Lorenzana is quoted in a statement released Friday by the Office of the Presidential Adviser on the Peace Process (OPAPP).
The meeting held in Camp Siongco, Maguindanao, was attended by Presidential Peace Adviser Carlito G. Galvez Jr., top military and police commanders, Cotabato Mayor Frances Cynthia Guiani-Sayadi, Maguindanao 1st District and Cotabato City Rep. Bai Sandra Sema, and Bangsamoro Islamic Forces Chief of Staff Sammy Gambar Al-Mansoor.
A couple of days before the South Seas Mall blast that killed two and wounded 34 people, tension was already building up in Cotabato City following hostile social media postings over the BOL referendum.
The city, currently under the SOCCSKSARGEN region, will be among the areas that will vote for or against inclusion in the new Bangsamoro region that will be formed under the BOL.
The current Autonomous Region in Muslim Mindanao (ARMM), which will be replaced by the new BOL political and geographical set-up, has its government headquarters within a compound in Cotabato City.
The Cotabato mayor, in a Dec. 30 post on her official Facebook page, said, “Ako ay walang personal na interest dito tulad ng ikinakalat ng ibang sarado ang pag iisip na animo mga anghel na nakababa sa lupa(I have no personal interest here, contrary to what is being spread by some close-minded people who think themselves as angels who have come down to earth).”
“Ang interest ng nakararami ang importante sa akin, na malaya silang makapagdesisyon kung Ano ang nararapat sa buhay ng bawa’t Isa (The interest of the majority is what is important to me, that they be able to freely decide what is suitable for the life of each one),” Ms. Sayadi wrote.
Mr. Lorenzana said they called for the meeting to prevent speculation and “finger-pointing” on the bombing and ensure the people of “free and peaceful elections and plebiscites.”
“Rest assured that your military and police are doing their best to ensure that you can vote freely according to your choice,” he said.
Earlier on Thursday, Mr. Lorenzana presided over a command conference in Cotabato City with military and police officers to discuss updates on the bombing.
“Until we get to the bottom of this, we consider this incident a terror attack,” Mr. Lorenzana said.
At the conference, it was confirmed that the bomb “was made of a plastic container with improvised electric blasting cap, 9-volt battery, and concrete nails attached to a cellphone with sim card,” according to a statement from the military’s Western Mindanao Command (WesMinCom).
Mr. Galvez, who previously led the WesMinCom and retired as head of the Armed Forces of the Philippines before heading the OPAPP, said, “We can’t win peace by force, but by persuasive diplomacy and understanding.”
BREAKER
Meanwhile, the Commission on Elections (Comelec) has granted the petition of 20 local government units (LGUs) to be included in the plebiscite.
Comelec Spokesperson James B. Jimenez said the Comelec en banc, in the first batch of decisions, denied 24 other petitions to participate in the plebiscite “for failing to comply with the rules regarding the voluntary inclusion in the Bangsamoro Autonomous Region.”
The LGUs in Cotabato which will join the plebiscite are: Barangays Libungan Torreta, Upper Pangkalan, Datu Mantil, and Simsiman in Pigcawayan; Rajahmuda, Barungis, Gli-Gli, Nalapaan, Panicupan, Nunguan, Manaulanan, Bulol, Bualan, and Nabundas in Pikit; Langogan, Pebpoloan, Kibayao, Kitulaan, and Tupig in Carmen; and Pagangan in Aleosan.
The plebiscite will be held on Jan. 21 for provinces in the ARMM, Isabela and Cotabato City, and on Feb. 6 for Lanao del Norte except Iligan City and six municipalities in North Cotabato.
On Oct. 22 last year, the Comelec announced it was accepting petitions from areas outside the identified Bangsamoro Autonomous Region of Muslim Mindanao (BARMM) to be included in the plebiscite.
BARMM’s proposed territorial jurisdiction is composed of the provinces of Basilan, Lanao del Sur, Maguindanao, Sulu, Tawi-Tawi, 39 barangays in Cotabato province, Cotabato City, and Isabela City in Basilan.
Aside from the abolition of ARMM and the formation of BARMM, the ratification of BOL would provide the region with additional financial assistance through a 75-25 percent tax collection scheme in favor of the region.
The national government will also give it a Special Development Fund of P5 billion every year for ten years for the rehabilitation of war-torn areas. — with Vann Marlo M. Villegas

Preparations in place for annual Black Nazarene procession

By Camille A. Aguinaldo, Reporter
MANILA Mayor Joseph E. Estrada suspended classes on Jan. 9, Wednesday, in all levels of public and private schools in Manila as security preparations are geared up for this year’s Traslacion or the procession of the Black Nazarene.
The Metro Manila Development Authority (MMDA) and authorities at Quiapo Church also issued the procession route of the Black Nazarene statue on Friday.
City Administrator Ericson A. Alcomendaz announced the class suspension at a televised press briefing in Quiapo Church on Friday.
“I would like to inform you that Mayor Erap signed yesterday Executive Order No. 1, Series of 2019 suspending classes in all levels, both public and private, on Jan. 9, 2019,” he said.
Work at the Manila city government is suspended that day, except for offices involved in the procession. Suspension of work in government agencies and private offices is left to the discretion of their respective heads, Mr. Alcomendaz added.
The city government will also impose a no-vendor policy during the procession, the city administrator said.
For his part, National Capital Region Police Office (NCRPO) chief Guillermo T. Eleazar said the police force will observe a no-fly zone, no-sail, and no-cellphone signal zone around the areas that the Black Nazarene procession will go through. He said the police force is already 85% complete with its preparations.
He reiterated that the Philippine National Police (PNP) will also dispatch around 7,200 police personnel to ensure the safety of the 2.5 million devotees expected to join the procession.
MMDA chairman Danilo D. Lim said in a statement that his agency will deploy 850 personnel near the Quirino Grandstand, Quiapo Church, and along the route of the statue procession.
The route of the Grand Procession of the Black Nazarene will be from the Quirino Grandstand to Katigbak Drive thru P. Burgos, left Taft Ave. thru Jones Bridge, right to Dasmarinas St., right to Plaza Sta. Cruz St; left Carlos Palanca st. under Quezon Bridge, left Quezon Blvd., right Arlegui st., right Fraternal st., right Vergara st., left Duque de Alba st., left Castillejos st., left Farnecio st., right Arlegui st., left Nepomuceno st. (counterflow), left Aguila st., right Carcer st., right Hidalgo thru Plaza del Carmen, left Bilibid Viejo thru Puyat, left Guzman st., right Hidalgo st., left Bautista (Barbosa) st., right Arlegui st., left Quezon Blvd., right Palanca st. under Quezon bridge, right Villalobos thru Plaza Miranda to Quiapo Church.
The MMDA will be in charge of managing traffic in the designated routes of the procession and alternative routes for motorists.
A sidewalk-clearing group will also help in crowd control while the Metro Parkway Clearing Group will manage road clearing at the Luneta Parade Ground and on roads that are part of the procession route. The Department of Public Works and Highways (DPWH) will also take part in clearing operations before the event.
Health stations will be designated in key areas by both the city government and the Department of Health (DoH).
Traslacion is an annual event of the Quiapo Church wherein devotees carry the Black Nazarene statue along the streets of Manila, commemorating the transfer of the statue from Luneta to Quiapo in 1868.

Estrella-Pantaleon Bridge closed for 30 months beginning Jan. 12

THE Department of Public Works and Highways (DPWH) will close for 30 months the Estrella-Pantaleon Bridge, which connects Makati City and Mandaluyong City, beginning Jan. 12, both the DPWH and the Metro Manila Development Authority (MMDA) announced on Friday.
“The closure is due to the demolition and reconstruction of the bridge which was initially set last September,” the MMDA said in its advisory.
DPWH’s advisory said “The total closure of…(the) bridge will be for thirty (30) months,” and recommended the following alternate routes: bound to Makati take Ortigas then EDSA; from Shaw Blvd. take EDSA; From D.M. Guevarra take EDSA; and from Boni Avenue take EDSA.
The project seeks to widen the bridge to four lanes. According to the DPWH timeline, the project is set to be completed in 2021.
The 506.46-meter bridge is one of two China-funded bridges along the Pasig River and forms part of the Metro Manila Logistics Master Plan, which aims to construct 12 bridges in addition to rehabilitation of the 30 existing bridges over the Pasig River. — Camille A. Aguinaldo

Investors take heart from weaker inflation

By Janina C. Lim, Reporter
PHILIPPINE EQUITIES climbed for a third straight trading day on Friday on the back of investor optimism in the face of easing inflation, with consumer stocks particularly benefiting from the latest price data.
The Philippine Stock Exchange Index (PSEi) rose 80.51 points or 1.04% to close 7,761.11 — up 3.95% from Dec. 28’s 7,466.02 finish — while the broader all-shares index went up 42.31 points or 0.91% to finish 4,652.59.
PSEi opened 0.3% weaker at 7,657.18 — the day’s low — but quickly ascended after the release of December inflation data to peak for the day at 7,801.50 before the noon break.
All six sectoral indices gained, while foreigners remained predominantly bullish for the second straight day.
“The local market opened in the red in knee-jerk reaction to the plunge on Wall Street last night but quickly reversed upwards on news that December inflation fell to 5.1%, way below consensus forecast of 5.7%,” RCBC Securities, Inc. said in a Stock Market Weekend Recap attributed to research analyst Fiorenzo D. De Jesus.
RCBC Securities noted that “[c]onsumer names were red-hot as investors may have been encouraged by the lower inflation data, which may support the outlook for discretionary spending growth this year”, particularly citing stocks of fast-food giant Jollibee Foods Corp. that jumped 5.82% and hit a record intra-day high of
P310.40 apiece before closing at P309 each.
“Investors also picked up top retailers Puregold (Price Club, Inc. whose price gained 4.54% to close P47.20 apiece) and Robinsons Retail (Holdings, Inc. which increased by 3.77% to finish P88 each).”
Regina Capital Development Corp. Managing Director Luis A. Limlingan said in a mobile phone message on Friday that “[i]nvestors readjusted their risk assessment of the Philippines as inflation came in much better than expected against the backdrop of a less favorable global outlook.”
The Philippine Statistics Authority reported in the morning that headline inflation eased to 5.1% last month, marking the slowest pace since May’s 4.6% though still much faster than the year-ago 2.9%. The latest inflation pace is lower than the 5.7% median in a BusinessWorld poll late last week and falls below the 5.2-6% estimate given by the Bangko Sentral ng Pilipinas (BSP) for last month.
“Week-to-date, the market woke from its New Year holiday stupor on Wednesday as funds went on a buying binge starting Thursday, anticipating that December inflation would show a substantial easing. The rally extended to Friday, as December inflation managed to beat expectations,” RCBC Securities said, while Regina Capital’s Mr. Limlingan said: “We expect inflation to improve in the coming months especially with the high base last year.”
Besides Jollibee, Puregold and Robinsons Retail, drivers of Friday’s rally included Ayala Land, Inc (up 2.9% to P43.70 apiece); Ayala Corp. (3.78% to P960); SM Prime Holdings, Inc. (1.32% to P38.50) and BDO Unibank, Inc. (2.6% to P132.80 each).
“As you can see, these businesses are in the property and consumer sector which may greatly benefit when the BSP decides to implement lenient policies that may contribute to higher consumer spending, and this means higher sales for these firms,” Timson Securities, Inc. Trader Jervin S. De Celis said in a text message.
Reuters reported that Wall Street plunged on Thursday in the face of signs of slowing US factory activity, with the Dow Jones Industrial Average dropping 2.83%, the S&P 500 shedding 2.48% and the Nasdaq Composite Index losing 3.04%.
Most major Asian markets rose: Hong Kong’s Hang Seng Index by 2.24%, South Korea’s KOSPI index by 0.83%, Shanghai Composite Index by 2.05%, and Jakarta Composite Index by 0.86%, although Japan’s Nikkei Stock Average 225 lost 2.26% while the FTSE Bursa Malaysia KLCI shed 0.36%.
Leading Friday’s charge in the Philippine bourse was mining and oil which surged by 195.44 points or 2.25% to end 8,872.15. It was followed by the industrial sector that climbed 235.20 points or 2.13% to 11,249.91, property which rose by 71.54 points or 1.88% to 3,877.36, financials which gained 11.19 points or 0.62% to 1,813.61, holding firms which went up by 37.21 points or 0.49% to 7,607.04 and services which edged up by 6.15 points or 0.41 to 1,483.41.
Stocks that gained were more than double those that lost 141 to 63, while 39 others closed flat.
Friday’s list of 20 most active stocks showed five that lost, namely: San Miguel Corp. (down 2.48% to P145.30 apiece); Bank of the Philippine Islands (down 1.58% to P93.50), SM Investments Corp. (down 1.25% to P946), International Container Terminal Services, Inc. (down one percent to P99) and Megaworld Corp. (down 0.21% to P4.83%).
Two stocks on the same list ended flat: Universal Robina Corp. at P128.50 apiece and Metropolitan Bank & Trust Co. at P84.60 each.
Trade volume increased for the second straight day to 1.959 billion shares worth P9.042 billion from Thursday’s 985.176 million issued worth P7.164 billion.
Net foreign buying grew more than fivefold to P1.019 billion from Thursday’s P196.718 million.
“Foreigners are… back to our market and they may have also contributed to this rally,” Timson Securities’ Mr. de Celis said, while RCBC Securities noted that “[f]oreign funds also wanted in on the action as net foreign buying reached P1.2bn week-to-date, mostly from the massive P1bn net foreign inflow today.”

Clark Airport concession holder to invest P6 billion

THE North Luzon Airport Corp. (NLAC) said it is investing about P6 billion to fit out the new terminal at Clark International Airport, bringing it up to an annual capacity of eight million passengers.
NLAC was the winning bidder for the operation and maintenance concession of Clark International Airport. The consortium is composed of Filinvest Development Corp., JG Summit Holdings Inc, Philippine Airport Ground Support Solutions Inc and Changi Airport Philippines (I) Pte. Ltd. (CAP).
CAP is a wholly-owned subsidiary of Singapore’s Changi Airports International.
“We are very optimistic about the prospects of Clark International Airport and will do our part to support its growth by providing a world-class gateway airport. With our Group’s experience in airline operations, property development and our various consumer-oriented businesses, we will provide the best service and value proposition to both passengers and airlines to make Clark International their airport of choice,” JG Summit Holdings Inc. President and Chief Executive Officer Lance Y. Gokongwei said in a statement on Friday.
Filinvest said that the airport is expected to help spur growth in the tourism industry and other related businesses as it will be a departure and arrival point for more route network, which aims to introduce Clark to more domestic and international destinations.
“With the New Clark International Airport, travelers and visitors can expect to be greeted with fast, efficient, and hassle-free service. We believe that the ease in travel in a world-class airport will help boost the region’s tourism and related businesses. It is NLAC’s vision to redefine the air travel experience at Clark International Airport. The airport will be Northern and Central Luzon’s gateway connecting the region to the Philippines and the world,” Filinvest President and CEO Josephine Gotianun-Yap said.
NLAC said that it will tap Philippine Airport Ground Support Solutions, Inc to provide ground handling services to the airport terminal.
JG Summit closed at P59.40 on Friday, up 3.04%.
JG Summit reported a 30% decline in net profit in the third quarter to P14.79 billion due to effects of high fuel prices and a volatile dollar on its Cebu Pacific airline business and on its petrochemical business. — Reicelene Joy N. Ignacio

DoE to require PSAs for ‘nationally significant’ projects

THE Department of Energy (DoE) will not issue certifications for energy projects of national significance (EPNS) if an applicant has no power supply agreement (PSA) in place, officials said.
“What we agreed on in December is that we will follow Undersecretary [Jesus Cristino P. Posadas]’s instruction not to issue an EPNS certification without a PSA,” DoE Undersecretary William Felix B. Fuentebella told reporters.
A PSA is typically a crticial milestone for power projects, signed before construction of a power plant starts in order to reassure banks that the plant will have ready buyers for its output.
A certification that a project is nationally is stipulated in Section 5 (a) of Executive Order No. 30 s. 2017, which intends to establish a simplified approval process and harmonize the rules and regulations of all government agencies involved in the permitting process.
EO 30 was signed by the President in June 2017, while the Energy department issued the implementing rules and regulations in April 2018. The law created the Energy Investment Coordinating Council, which came out with the guidelines on how energy-related projects can qualify.
“If the issue is for transmission or distribution, you will be given an EPNS,” he added.
“But if you use the EPNS to get your PSA, the answer will be ‘no’.”
He added that some project proponents have been using the EPNS certification to improve their chances of obtaining contracts and PSAs.
During the pre-development phase, the certificate entitles project proponents to all the rights and privileges provided for under EO 30, including action on applications within 30 working days.
A certified project will also enjoy presumption of prior approval, that is, it is presumed to have complied with the requirements and permits from other government permitting agencies.
It will be deemed approved if no action is taken five days after the lapse of the 30 working-day period for processing the application.
Mr. Fuentebella said there have been questions raised about the issuance of a certificate of EPNS to some power developers even if they did not have power supply contracts.
Asked about which project prompted the stricter certification process, he said: “Atimonan was the trigger.”
He was referring to Atimonan One Energy, Inc. (A1E), which is developing a 1,200-megawatt (MW) coal-fired power plant in Quezon.
The Energy Regulatory Commission (ERC) has yet to act on A1E’s PSAs.
Mario C. Marasigan, director of the DoE’s Electric Power Industry Management Bureau, said the certificate of EPNS is meant to facilitate licenses, clearances and permits.
“So it’s not supposed to develop the investment. The investment should be there already,” he said.
“But to avoid delay, EPNS will be issued. So if your intention is to attract more investment for the project, EPNS will not work. If you have a problem with the local government, then EPNS will be useful,” he said. — Victor V. Saulon

DoLE lifts ban on Boracay work permits for foreigners

THE Department of Labor and employment (DoLE) has lifted the suspension on the issuance of work permits for foreigners in Boracay, following the reopening of the island on Oct. 26 after a six-month rehabilitation.
In an advisory, Labor Secretary Silvestre H. Bello III ordered the lifting of the suspension of the of alien employment permit (AEP), which was implemented on June 26, 2018, following Presidential Proclamation No. 475, series of 2018 which closed Boracay to visitors between April 26 and Oct. 25.
“In view of the lapse of the closure period stated under the Proclamation No. 475, s. 2018 and re-opening of the Island of Boracay as a tourist destination, this Department hereby orders the lifting of the suspension on the issuance of AEP,” according to the advisory.
President Rodrigo R. Duterte in early 2018 called Boracay as a “cesspool” and ordered its closure to fix a number of environmental problems, including garbage collection and sewage that was leaking out into the sea.
DoLE issues AEPs to foreigners planning to work in the country for more than six months.
The department exempted from suspension foreigners conducting research and work related to the rehabilitation of Boracay. Foreigners who were permanent residents and who hold temporary probationary resident visas under the Philippine Immigration Act and Alien Social Integration Act of 1995 were also unaffected by the suspension.
During the Senate Committee on Labor, and Employment Development inquiry on Nov. 26, the DoLE issued 115,652 AEPs between 2015 and 2017. — Vann Marlo M. Villegas

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