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Capitol Commons sparkles with lights display

ORTIGAS LAND, formerly Ortigas & Company, unveiled an outdoor light installation at the Capitol Commons Park in Pasig City.

Inspired by the popular “Urban Light” display at the Los Angeles County Museum of Art (LACMA), “Lights at the Park” is expected to attract Filipinos looking for that perfect Instagram-worthy shot this holiday season.

The display features 42 lamp posts in varying heights with 50,400 lightbulbs. It is open to the public from 6 p.m. to 11 p.m. every day until Jan. 5, 2020.

The mixed-use estate Capitol Commons is home to the Estancia Mall.

Indonesia facing ‘new norm’ of low inflation — central bank

BANK INDONESIA said the country has entered a “new norm” of historically low inflation, which can affect interest rates. — REUTERS

INDONESIA has entered “a new norm” of historically low inflation, according to a senior central bank official, possibly portending an era of lower interest rates.

While Indonesia has in the past seen inflation around 6% — even in double digits — “right now there’s a new norm. We already have 3%,” Bank Indonesia Senior Deputy Governor Destry Damayanti said in an interview in Jakarta. “If we can maintain inflation at this level, of course this will be reflected in our interest rate.”

The comments come as Indonesia’s central bank adopts a more cautious approach to lowering interest rates further. While additional easing remains on the table, Ms. Damayanti said Friday a further adjustment to the key rate “is not the only weapon” the central bank can employ.

As global growth slows, Indonesian officials have become increasingly worried about the state of Southeast Asia’s largest economy. The government has revised down its 2019 growth projection several times, with the economy now on course for its slowest expansion since 2017.

Ms. Damayanti flagged that rates may remain on hold as the bank waits to gauge the impact of an aggressive stretch that has seen 100 basis points (bps) of cuts since July. Despite continued weakness in the economy, Damayanti said the depth of easing may not end up matching the extent of last year’s 175 bps of tightening.

“We cannot say that. It really depends on the situation, global and also domestic,” she said. “We still have to maintain the attractiveness” of Indonesian assets, she added, pointing to the spread between local and US rates.

NOT GOOD ENOUGH
Indonesia’s economy has lost momentum in every quarter this year. Gross domestic product is forecast to expand about 5.1% this year, down from an initial projection of 5.3%.

“Is it enough if Indonesia only grows at 5%? Of course not,” Ms. Damayanti said. “We need more acceleration in growth.”

The impact of this year’s rate cuts will start to be felt in the first quarter of 2020, she said. Ms. Damayanti said the central bank is confident the economy will pick up in 2020, with growth expected closer to the midpoint of a 5.1%-5.5% range and private consumption seen growing about 5%.

While Bank Indonesia’s main objective is stability of the rupiah, reflected in part by the inflation rate, its focus more recently has been on supporting growth and fiscal stability. At the same time, inflation has been trending down in recent years after hitting 8.4% in December 2014.

Inflation for all of 2019 is expected to come in at 3.1% after the consumer price index hit a seven-month low of 3% in November. The central bank is set to cut its inflation target band to 2%-4% in 2020, from 2.5%-4.5% this year.

POLICY MIX
Bank Indonesia will keep policy accommodative to support growth, but may use other tools beside rate cuts, Ms. Damayanti said. Last month the central bank held its benchmark rate steady but lowered the proportion of funds banks must keep in reserve, a step to pump cash into the economy.

Ms. Damayanti said the bank might opt for further adjustments to reserve ratio levels and other macroprudential levers.

“We’re using a mixed policy,” she said. “The interest rate is not the only weapon we have.” — Bloomberg

SEC: KAPA is not registered, cannot collect investments

THE Securities and Exchange Commission (SEC) is denying news that KAPA Community Ministry International, Inc. has been registered and is cleared to start operations as a crowdfunding entity.

In a statement Monday, the country’s corporate regulator disproved YouTube videos of a supposed radio broadcast that claimed KAPA “will not be subjected to NBI (National Bureau of Investigation) raid since it already registered with the Commission…”

“To set the record straight, KAPA is not registered with the Commission,” it said. “The public is hereby warned to exercise caution in viewing these kinds of YouTube video posts as they have been found to contain false reports.”

The SEC likewise reinforced its cease and desist order against the organization that it issued in February, which specifically named KAPA founder and president Joel A. Apolinario and any person acting on his behalf.

“The said Cease and Desist Order was eventually made permanent and is in full force and effect up to the present,” the SEC said, adding that the Commission en banc has issued an April 3 decision to revoke the certificate of registration of KAPA.

The SEC has been trying to warn the public against KAPA for almost three years as the organization violated provisions of the Securities and Regulation Code (SRC).

It filed a court case against the group in June for violating Section 8 (8.1) of the SRC which pertains to the requirement to register securities with the SEC; Section 26.1 which prohibits the use of schemes to defraud; and Section 28 which requires brokers and dealers to register with the SEC to buy and sell securities.

The Department of Justice eventually found in October probable cause to indict the identified KAPA officers in SEC’s complaint. These are Mr. Apolinario, trustee Margie A. Danao, corporate secretary Reyna L. Apolinario and others that were involved in KAPA’s illegal selling of securities: Marisol M. Diaz, Adelfa Fernandico, Moises Mopia and Reniones Catubigan.

The SEC claims KAPA solicits at least P10,000 from its members in the guise of “donations,” in exchange of monthly returns of 30% “blessings” or “love gifts” for life.

The SEC estimates KAPA has collected about P50 billion from its operations based on its supposed 5 million members and the minimum investment of P10,000 per head. — Denise A. Valdez

Provides good fun

Harvest Moon: Mad Dash
Nintendo Switch

GAMERS WILLING to set aside any preconceived notions they have of what a Harvest Moon game should be like will find Harvest Moon: Mad Dash to be a worthy addition to their respective Switch libraries. Let’s be honest: The truth is that the Harvest Moon brand does little to add to its engagement. It has none of the farming or relational elements of the usual release in the long-running series; it is, in fact, quite short and simple. Still, it has just enough fun and charm to engage those angling for a diversion absent the commitment that, say, Fire Emblem: Three Houses or Monster Hunter Generations requires.

The Harvest Moon franchise has thrived through generations of consoles; from the Super Nintendo Entertainment System/Super Famicom in 1996 onwards, it has engendered a loyal following of gamers that willingly follow platform shifts. It has even survived a potential saturation of the brand. Marvelous’ decision to have subsidiary Xseed Games take over distribution of future titles in North America led to the creation of the Story of Seasons branch. Meanwhile, developer Natsume, which retained rights to the Harvest Moon name, has seen fit to make its own contributions to the series.

As its very title indicates, Harvest Moon: Mad Dash comes from the Natsume side of the equation. And instead of the usual drawn-out story of a newbie farmer in a rural community searching for romance and profit, it features gameplay elements that have more in common with the likes of Tetris and Columns. To earn points, gamers need to put together fruits, vegetables, or fish of the same kind, rotating pieces to make them fit and form perfect squares (2×2, 3×3, or 4×4), and then “harvesting” them as they mature or grow.

Harvest Moon: Mad Dash has a few monkey wrenches thrown in to add to the challenge of produce and crop sorting. Making shapes that are too large will cause the produce to wilt. Taking too long to put together fish in a bigger body of water causes them to disappear. Even as gamers have their character run around the screen to put the puzzle pieces together, they’re also hard-pressed to feed the animals and get eggs, milk, or wool. Chickens, cows, sheep, and alpacas roam the board lazily, blocking their way or preventing them from creating larger shapes.

Aside from animals out to pasture, Harvest Moon: Mad Dash presents hazards such as ice, coconuts, and volcanic lava that fall randomly. There are also wild boars that barrel through the farm and trample everything in their paths. All these can wipe out crops and delay gamers in a frantic race to accumulate points and fill the power meter. Doing the latter allows for jumps to a temporary time-space continuum where the crops are all ready for harvest and distracting obstacles magically disappear, enabling the accumulation of points needed to pass a level.

In Harvest Moon: Mad Dash, each level can yield up to three stars. At the end of specific stages, gamers will need a certain number of stars to move on. More stars also allow for the tapping of Harvest sprites to help in the form of extra time, power boosts, or healthy harvests. Parenthetically, opening the final stage requires acorns won from the Underworld or Skyworld areas; unfortunately, it’s so short as to be almost anticlimactic. When the credits roll, there is a palpable sense of wanting to go back for more. Thankfully, repeating the stages, whether for the opportunity to improve scores or simply for more fun, is seen as a welcome prospect.

Harvest Moon: Mad Dash allows for multiplayer options (up to four players) but extra Joy-Cons are required. Cooperative play opens up the possibility for higher scores as each player does his or her share of “farming” and “harvesting.” In any case, it pitches to a selective audience. It may not be for all, despite its E rating, and it may even disappoint dedicated fans of the franchise expecting gameplay elements typically carried by previous releases in the series. To those devoid of any preconceived notions, however, it should provide good fun. In this time and age of myriad entertainment alternatives that contribute to shorter and shorter attention spans, it figures to keep them engaged and wanting for more.

THE GOOD:

• Fun for the young and young at heart

• Challenging but not frustratingly so

• No commitment needed

THE BAD:

• Too short

• No narrative to provide context to the proceedings

RATING: 7.5/10

POSTSCRIPT: Mario & Sonic at the Olympic Games: Tokyo 2020 is exactly as it sounds, which is to say a game that has Nintendo and Sega’s iconic characters participating in the latest staging of the Summer Games. It’s part of a long-running series that taps multiple licenses to generate crossover appeal. That it works, and how, is attributable to its polish; it isn’t simply a product that lops together seemingly disparate intellectual properties for expediency and quick gains. Bottom line, it’s an extremely well-thought-out title that succeeds in making a variety of sports — events, really — accessible to a population of gamers otherwise loath to dabble in the genre.

Mario & Sonic at the Olympic Games: Tokyo 2020 boasts of a Story Mode that, owing to the machinations of Dr. Eggman and Bowser, compels gamers to participate in the 2020 Olympics and the 1964 Olympics, both in Tokyo — albeit with a twist; the former is presented in three-dimensional format, and the latter in eight- and 16-bit graphics and sounds reminiscent of those churned out by the Nintendo Entertainment System and Sega Genesis. The retro presentation has 10 sports on tap, while the modern one has twice as many; exclusives in each are present, further underscoring the differentiation.

Significantly, Mario & Sonic at the Olympic Games: Tokyo 2020 gives gamers options in steering their favorite characters. Joy-Cons can be used together or separately, and provide motion, directional-pad, and button alternatives. Regardless of choice, controls are extremely responsive, and at no time do they hold back or interfere with the unfolding action. To the contrary, the technical proficiency of the interface proves a boon, especially in light of the immediacy of the proceedings. If there’s any bane, it’s in the waiting time required to get an online multiplayer session going; apparently, there isn’t enough competition out and about and angling for a quick mini-game. And, yes, only one can be set up at a time; after a button-mashing bout that literally lasts for seconds, there is need to repeat the process.

Mario & Sonic at the Olympic Games: Tokyo 2020 notably brings back the popular Dream Events, over-the-top versions of Olympic sports. Considering their potential for fun, particularly as party options, it’s too bad that only Dream Racing, Dream Shooting, and Dream Karate make the leap to the franchise’s latest offering. That said, the release also doubles as a repository of information on Tokyo, as well as on the characters themselves. If nothing else, they widen the knowledge of gamers and serve to elevate the title to more than mere passing fancy.

On the plus side, Mario & Sonic at the Olympic Games: Tokyo 2020 puts forth an excellent audio-visual presentation. In fact, no other release in the series looks and sounds better. No doubt, Sega was motivated to put its best foot forward given own ties to the venue of the Quadrennial. Nonetheless, it succeeds in earning its AAA price tag. For all its frailties, it manages to generate interest as a multiplayer marvel, directly involving up to eight, and indirectly keeping more transfixed, in its adrenaline-pumping offerings. (8/10)

THE LAST WORD: Notwithstanding the ridiculous title, Is It Wrong To Try To Pick Up Girls In A Dungeon? — Infinite Combate has gamers out West anticipating its localization. Based on the light novel series written by Fujino Ōmori and published by SoftBank subsidiary SB Creative, the action role-playing game developed by Mages will have an Asian release with English support later this week. Play-Asia currently has it on preorder, with fulfillment of early reservations including an English-language slipcase, an A4-size clearfile, and a code for the digital copy of DanMachi de Shootint wa Machigatteiru Darou Ka. The latter has adventurer Ais Wallenstein and a handful of supporting cast mates negotiating five stages of side-scrolling shoot-‘em-up action.

PQube Games will be publishing Is It Wrong To Try To Pick Up Girls In A Dungeon? — Infinite Combate for release on the Switch, Sony PlayStation 4, and personal computer in North America and Europe early next year.

Capilla de San Lorenzo opens at Robinsons Magnolia

ROBINSONS Magnolia recently opened the Capilla de San Lorenzo, the first chapel in Quezon City named after Filipino saint Lorenzo Ruiz.

The chapel was blessed by Cubao Bishop Reverend Honesto Ongtioco on Sept. 28, which was the feast day of St. Lorenzo Ruiz.

“Fr. Dennis Soriano suggested the name because there was no chapel in Quezon City named after San Lorenzo Ruiz. It is also a tribute to the first Filipino saint,” Jasmin Lucio, regional operations manager of Robinsons Land Corp., said in a statement.

Located on the 5th floor mezzanine of the mall’s new wing, the chapel can accommodate 350 seated and 100 standing churchgoers. Anticipated Mass is celebrated every Saturday at 6 p.m., while regular Sunday Masses are at 10 a.m. and 4 p.m. Masses are also held every First Wednesday and First Friday of the month.

Staring 2020, there will be daily masses at 12:15 noon and an additional 6 p.m. mass every Sunday.

“We are looking at the possibility of celebrating Mass in other languages, like Chinese,” Ms. Lucio said, noting that as of now the masses are in English.

The chapel was designed by Jonathan Gan, inspired by the Immaculate Conception Parish Church.

For the Christmas season, Capilla de San Lorenzo will hold anticipated Simbang Gabi Mass at 8 p.m. beginning Dec. 15, in addition to the regular Mass schedule.

Repo market blowup fueled by big banks and hedge funds, BIS says

THE US Federal Reserve had said investors used repo to finance the purchase of newly auctioned Treasuries. — REUTERS

THE SEPTEMBER MAYHEM in the US repo market suggests there’s a structural problem in this vital corner of finance and the incident wasn’t just a temporary hiccup, according to a new analysis from the Bank for International Settlements (BIS).

This market, which relies heavily on just four big US banks for funding, was upended in part because those firms now hold more of their liquid assets in Treasuries relative to what they park at the Federal Reserve, officials at the Basel-based institution concluded in a report released Sunday. That meant “their ability to supply funding at short notice in repo markets was diminished.”

And hedge funds are financing more investments through repo, which “appears to have compounded the strains,” the researchers added.

This brings the BIS, the central bank for central banks, into a controversy that has vexed observers for almost three months: Why did the repo market get so bad, so quickly? On Sept. 17, rates on general collateral repo briefly surged to 10% from around 2%.

Many, including the Fed, concluded in the immediate aftermath that two transitory events collided: investors used repo to finance the purchase of a large batch of newly auctioned Treasuries at the same time that quarterly corporate tax payments drained liquidity from that market.

But the BIS doubts an ephemeral supply-and-demand imbalance is totally to blame.

“None of these temporary factors can fully explain the exceptional jump in repo rates,” Fernando Avalos, Torsten Ehlers and Egemen Eren wrote in the latest BIS Quarterly Review.

Reserves — or cash that banks stash at the Fed — are the easiest asset for banks to tap when they want to quickly move money into repo. And it would’ve been logical for banks to pour cash into repo to get those 10% returns from an overnight loan.

The four banks that dominate the market hold about 25% of the reserves in the US banking system, but 50% of the Treasuries. That mismatch likely slowed the movement of cash into repo, the BIS researchers postulated.

CASH BUFFERS
Volatility in the amount of cash the US Treasury keeps parked at the Fed also affected banks’ reserves. “The resulting drain and swings in reserves are likely to have reduced the cash buffers of the big four banks and their willingness to lend into the repo market,” the team wrote.

JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon has put the blame on regulators themselves. He said in October that his firm had the cash and willingness to calm short-term funding markets but liquidity rules for banks held it back.

Some analysts have also pointed to a new corner of the market which has seen immense growth: sponsored repo. This allows banks to transact with counterparties like money-market funds without impacting their balance sheet constraints. The downside is that it’s only available on an overnight basis, and as a result has further concentrated funding risk.

Along with changing market structure, the researchers also connected the repo ruckus to banks being somewhat out of practice in daily reserve management. That’s because trillions of dollars worth of Fed asset purchases — the so-called quantitative easing program meant to help the economy recover from the 2008 financial crisis — had left the banking system flush with cash for years.

FED CAMPAIGN
“The internal processes and knowledge that banks need to ensure prompt and smooth market operations may” have started to decay, BIS wrote. “This could take the form of staff inexperience and fewer market-makers, slowing internal processes.”

The Fed in 2017 started shrinking its balance sheet and shortages began to re-emerge last quarter. The central bank stopped paring back holdings in August and started buying Treasury bills in October, an attempt to add reserves to the banking system. That was part of its campaign to keep the repo market calm, an effort that began in September with overnight and then longer-term repo operations.

“These ongoing operations have calmed markets,” the BIS researchers wrote.

Still, market participants are wary that trouble may resurface at yearend — a time when repo liquidity has historically been scarce. There’s been high demand from money-market participants for cash via repo that the Fed’s been offering with tenors that will extend into the new year.

The report also took a look at the European repo market, which escaped the kind of turmoil that engulfed the US in September. But that doesn’t mean all is calm. Beneath the surface, the 8-trillion-euro ($9-trillion) market is becoming increasingly fragmented, raising the risk that cash may not flow through properly, the BIS said. — Bloomberg

SteelAsia sees capacity at 2.5 million tons by 2021

STEELASIA Manufacturing Corporation expects capacity to hit 2.5 million tons in 2021 as it expands operations.

SteelAsia Vice-President and Head of Business Development Raphael C. Hidalgo told reporters at a media event that the company produced almost 2 million tons this year. Its new operations in Compostela, Cebu will expand its production capacity after it goes into operation in late 2020.

“So 2021 will be the real one where you see the number go up. In terms of capacity, we’re going to add another one million tons. But this isn’t one million tons for the present — it’s one million tons for the future. So maybe it will give us an additional half million tons.”

The steel industry in the Philippines is currently dominated by rebar production. SteelAsia plans to expand to other steelmaking, rolling, and fabrication and cold processes. This would address demand through the local production of beams, sheet piles, and angles, among other steel products — instead of importation.

The company is also currently working on its initial public offering, as it plans to go public within two years.

“We started preliminary work already on the corporate side, but going out and starting process with SEC (Securities and Exchange Commission) hindi pa (not yet),” Mr. Hidalgo said. — Jenina P. Ibañez

What’s Going On (12/10/19)

Jumanji promo at SM

IN CONNECTION with the screening of Jumanji: Next Level, SM Cinema’s “Action & ARTventure” promo gives moviegoers a reel to real experience over the holidays. Today is the last day to have a chance to win two tickets to Art in Island museum — a single receipt purchase of Jumanji: Next Level movie tickets of at least P500 gives moviegoers a chance to win. Ten winners from the participating SM Cinema branches SM North EDSA, SM Mall of Asia, SM Megamall SM Marikina, SM Fairview, SM Sta. Mesa, SM San Lazaro and SM Manila will be selected on Dec. 16. Deadline of dropping of entries is on Dec. 10 at 10 p.m. This promo is valid for SM Cinema regular theaters and IMAX at the selected branches mentioned above.

Eric Nam in Manila

KOREAN singer, songwriter, and TV personality Eric Nam will hold a concert in Manila on Jan. 10 at the New Frontier Theater in Cubao, QC. The Before We Begin 2020 World Tour will kick off in Asia with Manila as the second leg, following the opening show in Taipei. This will be the first time that the 31-year-old entertainer will perform many of his new songs to a worldwide audience. Nam’s latest album Before We Begin, released on Nov. 14, is his first all-English project. Tickets for the concert are available at TicketNet for P9,299 (VIP, inclusive of Meet & Greet and a signed merchandise); P5,016 (Orchestra); and P2,821 (General Admission). For details visit Instagram.com/onionproduction, Facebook.com/onionproduction, and ericnam.com.

The Rose on tour

SOUTH KOREA’s popular indie band The Rose will perform in Manila, the second of two stops on its a Southeast Asia tour this month. After performing in Kuala Lumpur, The Rose will perform at the Samsung Hall in SM Aura in Taguig on Dec. 15. The tour is in response to requests on fan-initiated concert making platform MyMusicTaste. For details visit https://mmt.fans/Vh74/ or other social media channels of MyMusicTaste.

First Balfour marks 50th anniversary

LOPEZ-LED First Balfour continues to look for opportunities for growth, as the engineering and construction company recently celebrated its 50th anniversary.

“The demands of a growing nation like the Philippines are evident in infrastructure that’s bursting at the seams and barely keeping up with our people’s needs. First Balfour is in position to help alleviate these gaps in collaboration with many of you, our partners, who are always ready to develop projects that rise to these challenges,” First Philippine Holdings (FPH) Chairman and CEO Federico R. Lopez said during his keynote speech at First Balfour’s anniversary celebration.

A subsidiary of First Philippine Holdings (FPH), First Balfour started out by relying on businesses from Lopez Group companies, but now the bulk of its revenues come from non-FPH clients.

First Balfour President Anthony L. Fernandez attributed the company’s success to its capabilities system.

“This milestone is no small feat but I believe 50 years is just the result of having a strong and established capabilities system. While strengthening our core engineering and construction capabilities, we have also developed adjunct capabilities including heavy equipment rental (T1 Rentals), geothermal drilling (ThermaPrime), and concrete and aggregates (Torreverde) to help in project delivery,” he said.

Among First Balfour’s prominent projects include the civil works and electrical network for the 150-megawatt Burgos Wind Farm; the North Extension of the Light Rail Transit Line 1 completed in 2010; and the construction of modern data centers for the Philippine Statistics Authority, ePLDT, and Globe Telecom.

How PSEi member stocks performed — December 9, 2019

Here’s a quick glance at how PSEi stocks fared on Monday, December 9, 2019.

 

Damage to agriculture from Tisoy reckoned at P3.67 billion

DAMAGE TO agriculture from Typhoon Tisoy (international name: Kammuri, was estimated at P3.67 billion, the Department of Agriculture (DA) said.

The DA said in its bulletin no. 9 that damage to the rice crop was 104,928 metric tons (MT) worth P1.32 billion, with 77,683 hectares of rice land affected.

Corn damage was 5,895 MT worth P700.92 million, with 41,256 hectares affected. Damage to high-value crops was 84,222 MT worth P1.55 billion, over 13,227 hectares.

Livestock and poultry losses totaled P61.96 million, involving 144,505 animals and 246 farmers. Losses to the coconut industry totaled P28.04 million covering 5.384 million trees.

Fisheries losses totaled P2.18 million, with 39 fisherfolk affected. Losses were mainly sustained by tilapia and mud crab growers, while most equipment losses were to motorboats.

Infrastructure losses amounted to P33.5 million, including greenhouses, research centers, cages, warehouses, demonstration farms, and nurseries. Machinery losses amounted to P706,000 amid damage to threshers, hand tractors, and shredders.

Aside from the DA’s P250-million Quick Response Fund (QRF) for rehabilitation, the Agricultural Credit and Policy Council (ACPC) has set aside P65 million for the Survival and Recovery Assistance (SURE Aid) program.

“The affected regions have a total of 93,711 bags of rice seed, 17,999 bags of corn seed, 1,979 kilos of seed for high-value crops in reserve and ready for distribution,” the DA said. — Vincent Mariel P. Galang

Gov’t draft of new water contracts expected to be ready by year’s end

JUSTICE Secretary Menardo I. Guevarra said the government is forming a team to draft revised water concession contracts, which will exclude terms the President considers onerous, adding that the new concession agreement will be ready before the year ends.

“We are still forming our team that will come up with the government version of the water concessionaire agreements,” Mr. Guevarra said on the sidelines on an event against corruption.

“We hope to be able to come up with the revised version of a water concession agreement that has not include the onerous provisions… before the year is over,” he added.

President Rodrigo R. Duterte last week said Manila Water Co. Inc. and Maynilad Water Services, Inc. enjoy onerous provisions in their concession agreements with the Metropolitan Waterworks and Sewerage System.

Mr. Guevarra said last week that the department found “a dozen provisions that were deemed onerous or disadvantageous to the government and consuming public.” He cited among other provisions, the prohibition against interference of the government in rate-setting and indemnities for possible losses in case of government interference.

He also said that the department found irregular the extension of the contracts to 2037 which was granted “12-13 years” before the 25-year concession agreement expires in 2022.

The government will complete the revisions and only then will sit down with the water companies, he said.

The new contracts will be drafted by lawyers from the Office of the Solicitor General (OSG), Office of the Government Corporate Counsel, Department of Finance and Department of Justice.

“Marami naman okay na provisions (There are many provisions that are all right). It’s just a matter of weeding out… (the) provisions which we consider onerous or highly disadvantageous but the rest of the agreement can stand,” he said.

If the concessionaires do not agree to the revisions, Mr. Guevarra said the government will bring the matter to the courts.

Manila Water disclosed to the Philippine Stock Exchange early this month the Permanent Arbitration Court in Singapore ruled in its favor, ordering the government to indemnify it the amount of P7.39 billion over its losses resulting from the government’s breach of obligations. The court is September last year also awarded P3.4 billion to Maynilad on similar grounds.

The OSG said last Friday it will exhaust all legal remedies in response to the ruling in favor of Manila Water and its next steps “will show that the arbitral award was not, to quote Manila Water, due to a ‘procedural lapse’ by government. It is a company’s refusal to become the subject of legitimate regulation.”

Mr. Guevarra said that the arbitration cannot necessarily be enforced because the government is ready to oppose it.

“OSG is thinking of appealing the arbitral ruling to the Singapore High Court or when this decision is enforced in local courts in Philippine court, then (the) Philippine government will surely oppose it on the grounds that the arbitral ruling is against public policy,” he said.

Metro Pacific Investments Corp. (MPIC) and DMCI Holdings, Inc. hold 52.8% and 25.24% stakes, respectively, in Maynilad. Meanwhile, Japanese trading company Marubeni Corp. has a 20% interest in the utility.

On the matter of the contract extension, the government can disregard the 15-year extension because the extension’s validity is in question, Senator Aquilino L. Pimentel said.

Mr. Pimentel, who chairs the Senate Committee on Trade, Commerce and Entrepreneurship, said former President Gloria Macapagal-Arroyo’s government had no authority to approve the extension.

“Babalik ako sa aking basic principle na since hindi pa expired ang original contract, wala pang 2022, hindi pa pwedeng i-invoke ang extension (I return to the basic principle that the original contract has not expired, and will not do so until 2022. so it is not yet possible to invoke an extension),” Mr. Pimentel told reporters in a briefing Monday.

“Kung di pa ‘yan implemented, pwede pa s’yang i-disregard ng Duterte administration (If it is not yet implemented, the government can disregard it).”

The MWSS concession deal with Manila Water and Maynilad was extended to 2037. The extensions were approved respectively in October 2009 and April 2010, way ahead their 2022 expiration.

“The Gloria administration cannot tie the hands of the Duterte administration,” he said.

Mr. Pimentel said the government should now clarify whether it will revoke the extension, and begin by 2020 the process of accepting applications for a new concession agreement. He noted that present concessionaires are not necessarily disqualified from applying.

“Start the process by 2020, 2021 of looking for new concessionaires, announcing before the search, the new terms of the concession agreement.” — Vann Marlo M. Villegas, Charmaine A. Tadalan

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