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Australian fund managers are already betting on quantitative easing

AUSTRALIAN asset managers are gearing up for what was once unthinkable: the prospect of quantitative easing (QE) in their own backyard.

They’ve pored over the lessons from overseas and arrived at a different conclusion to central bank chief Philip Lowe, who has sought to damp expectations that QE is likely in Australia.

Some including QIC Ltd. and Nikko Asset Management Ltd. are already buying assets on bets that interest-rate cuts won’t be enough to combat slowing economic growth. They see the impact of asset purchases rippling broadly through debt markets, even if Lowe manages to limit any QE program to government bonds.

“QE could come even before any recession,” said Susan Buckley, QIC’s managing director for global liquid strategies, who is overweight Australian credit. Unorthodox monetary policy “is definitely a scenario we have to prepare for. Everyone’s talking about QE.”

The Reserve Bank of Australia (RBA) has cut interest rates three times since June, to a record low 0.75%, amid a slide in economic growth to the slowest pace in a decade.

Mr. Lowe has said in a speech on Nov. 26 that rates would need to go to 0.25% before he’d consider QE, and that even then, the hurdle to asset purchases would be high. He also signaled that the RBA would have little appetite for buying private-sector assets.

But with unemployment that’s too high to drive up wages and tepid gains in consumer prices, investors expect Mr. Lowe to be pushed outside his comfort zone. Many of them were right in positioning for the recent run of rate cuts. The RBA stood pat on Tuesday.

“Look across the developed world and if you can show me a country that’s averaged 2.5% inflation over the past 10 years then you’re doing a better job than me,” said Chris Rands, portfolio manager at Nikko Asset, who is loading up on semi-government bonds. “Why would Australia be the country that achieves that when no one else has?”

Here’s how some fund managers are preparing for QE:

LONG BONDS
Australian sovereign bond yields are likely to fall across the curve as the RBA steps in as a default purchaser, said Raymond Lee, money manager at Kapstream Capital, a unit of Janus Henderson Investors. That makes government bonds a fairly compelling buy for the A$14-billion ($9.6-billion) fund.

“We’ve increased our duration at the beginning of this year, just because we felt that rates were going to stay lower for longer,” said Sydney-based Mr. Lee. While QE might still be “a while away, RBA comments on unconventional policy only confirms the fact that rates are going to stay low and could rally further.”

The central bank may buy up to A$50 billion of Australian government bonds as part of a QE package as early as next year, according to JPMorgan Chase & Co.

Stuart Dear, deputy head of fixed-income at Schroder Investment Management Australia Ltd., is also positive on Australian sovereign debt. He expects bonds with maturities shorter than five years to outperform if the RBA embarks on QE.

SEMIS BET
Nikko Asset started buying Australian dollar-denominated semi-government debt last year, wagering notes maturing in a decade were priced attractively.

It’s been a profitable trade. Yield spreads of quasi-government debt have narrowed against their sovereign counterparts.

“We can look at the US experience for this, where even though they bought government bonds there, other assets all got supported,” Mr. Rands said. “It’s likely to be the same in Australia, as QE gives semis an extra kick.”

Schroders’ Mr. Dear has also boosted holdings of semi-government securities.

“We have increased our exposures by buying semi-government bonds and residential mortgage-backed securities,” he said. “This buying came ahead of Lowe’s speech, which has broadly affirmed our views.”

CREDIT BOOST
Others including QIC’s Ms. Buckley see Australian corporate bonds gaining, even if the RBA’s initial focus is on government debt.

She sees unconventional stimulus as likely to “float all boats.”

On top of this, the RBA could run out of sovereign bonds to buy. Mr. Lowe has noted that the gross stock of government debt is projected to decline over the years ahead. And the biggest owners of the bonds — domestic banks and foreign central banks — are long-term holders who may not be willing to sell in large quantities.

While rising risks of a recession or economic slowdown would normally see the A$85-billion money manager shed some of its credit exposure, Brisbane-based QIC is taking a new tack.

“We’ve seen this play out in the UK, Europe where spreads have compressed as a result of ECB (European Central Bank) purchases, and it could happen here as investors push out the credit spectrum as risk-free rates fall,” Ms. Buckley said.

SHORT AUSSIE
For those scouting for a more liquid way to trade Aussie QE, shorting the nation’s currency presents the best avenue, said Stephen Miller, adviser at GSFM, a unit of Canada’s CI Financial Group.

“If QE is coming, the Australian dollar will look sick and likely get sicker,” Sydney-based Mr. Miller said. “It’s a good short if you’re looking to war game quantitative easing, and right now, I’d say a target of around 65 US cents is achievable.”

The Aussie has weakened about 3% against the greenback this year and touched a decade-low of 66.71 US cents in October as traders priced in fresh interest-rate cuts.

Australia’s economic growth slowed to 0.4% in the third quarter from the previous three months, slightly less than economists forecast, according to data released Wednesday.

The nation’s biggest pension fund, AustralianSuper Pty., is underweight the Aussie and long sovereign paper on bets the RBA may unleash QE as early as next year.

The central bank is likely to push rates to as close as zero as they think they can without damaging the banking system, according to Carl Astorri, head of asset allocation and research at the A$175-billion fund. “That process would flatten the yield curve and push the currency down,” he said.

TIMING QE
To be sure, no market participant can say for certain when and how QE will finally be deployed.

Recovering real estate prices may spur a housing-related consumption rebound, helping the RBA stay its hand on unconventional policies next year, according to Goldman Sachs Group, Inc.

Citigroup, Inc. reversed its call for stimulus in 2020, forecasting just one more RBA rate cut before the central bank keeps rates on hold. Barclays Bank Plc predicts QE is unlikely as Australia’s economy heads towards a “gentle turning point.”

For some, it’s still better to be safe than sorry.

“There are several steps before the RBA gets to QE, but if they need to act further down the track, they likely will,” said GSFM’s Miller. “I’m not surprised some think now might be the time to start buying assets.” — Bloomberg

How PSEi member stocks performed — December 4, 2019

Here’s a quick glance at how PSEi stocks fared on Wednesday, December 4, 2019.

 

Lacson proposes more UHC, National ID funding

SENATOR Panfilo M. Lacson said he proposed budget amendments providing for additional funding for the Philippine Identification System (PhilSys) program, Universal Health Care (UHC), and free university tuition.

In documents posted to his website, Mr. Lacson outlined his proposed amendments to the Senate Finance Committee, noting that the key programs have been allocated insufficient funds in the P4.1 trillion 2020 budget. The two chambers’ budget bills are currently being harmonized in bicameral session with a ratification target of next week.

Mr. Lacson proposed to increase the budget of the Philippine Statistics Authority (PSA) to P7.009 billion from P1.364 billion, citing the insufficient allocation for Philsys, or the National ID program, of P2.4 billion.

He said the estimated cost to provide IDs to an initial 14 million Filipinos is P5.7 billion, more than double the budgeted funds.

The National ID is intended to increase financial inclusiveness by giving those without bank accounts access to an ID acceptable to all banks. A more secure ID is also expected to reduce benefits fraud in cash transfers to the poor and possibly ease the implementation of Universal Health Care (UHC).

“The funding gap will significantly hamper our annual implementation targets and fundamentally, our aim to achieve universal coverage,” Mr. Lacson said.

Mr. Lacson also proposed to increase the budget of the Commission on Higher Education (CHEd) by P2 billion to P45.88 billion. The increase will fund the Tertiary Education Subsidy.

He proposed to increase the Department of Health’s (DoH) budget by P3 billion, with P1 billion to support the Health Facilities Enhancement Program, and P2 billion for the Human Resource for Health program.

“One of the key programs under the UHC is the Health Facilities Enhancement Program where appropriations significantly decreased from P15.92 billion under the 2019 GAA (General Appropriations Act) to a mere P5.9 billion under the NEP National Expenditure Plan) 2020.”

To fund the increased program budgets, Mr. Lacson proposed to reduce the funding for the Department of Transportation (DoTr) and Department of Public Works and Highways (DPWH), among others.

The DoTr budget for Right-of-Way Acquisition was reduced by half to P5 billion, while P15 billion was slashed from the DPWH ROW appropriations.

Mr. Lacson said as of Oct. 31, the DoTr has only obligated P1.2 billion of P13.26 billion budget for ROW payments. “Considering that huge unused appropriations will be carried over next year, it is inefficient to provide substantial funding for ROW,” he said.

He said the DPWH’s average unused appropriations from 2011 to 2018 was P82.4 billion.

The chambers of Congress are working to submit the budget to President Rodrigo R. Duterte for signing before the year ends and avoid a repeat of the four-month delay in the 2019 budget, which has been blamed for dampening economic growth in early 2019. — Charmaine A. Tadalan

Dominguez, Pernia due in Tokyo to discuss progress of key Japan-backed infrastructure projects

THE government’s economic team will meet Japanese officials this week in Hakone, southwest of Tokyo, to discuss the progress of big-ticket infrastructure projects supported by Japan.

Finance Secretary Carlos G. Dominguez III and Socioeconomic Planning Secretary Ernesto M. Pernia will represent the Philippines Friday during the ninth high-level meeting of the Philippines-Japan Joint Committee on Infrastructure Development and Economic Cooperation.

Meanwhile, the Japanese delegation will be led by Hiroto Izumi, special advisor to the Prime Minister.

Mr. Dominguez said in a statement Wednesday that the two countries regularly meet to ensure a “fast and sure” approach in implementing the Japan-funded projects under the “Build, Build, Build” program.

The two sides met in Clark earlier this year while the very first meeting was held in March 2017 in Tokyo.

In an interview on Wednesday, Mr. Pernia said that the meeting will assess ongoing projects “to see how they are moving, if there is any need for midway adjustments and also to look at the projects in the pipeline that will be ready for implementation.”

Mr. Pernia said that the two countries will ensure that ongoing projects are delivered sooner than later. The pace of implementation will also be discussed to see if there is a need for an “additional push.”

Asked if new agreements will be signed, he told BusinessWorld: “so far, there’s nothing that has been scheduled but it’s possible that need for new loans may just crop up and the Japanese side may just be willing to accommodate.”

Since President Rodrigo R. Duterte assumed office in June 2016, the two sides have signed 10 loan agreements in total, Mr. Dominguez said. He added that these loans were processed and approved in a span of three to four months.

As of December, Japan was the top source of official development assistance (ODA) loans and grants.

Japan accounts for 46% of the country’s total ODA loan portfolio.

Japan was also the country’s second-largest trading partner in 2018 with two-way trade of $21.1 billion. It was the second-largest export market with shipments worth $10.3 billion, and the third-largest source of imports worth $10.82 billion.

Japan was the fourth-largest source of visitors with 631,000 in 2018, up 8.15% from a year earlier.

The country’s 10 loan agreements with Japan fund the second phase of the Maritime Safety Capability Improvement Project for the Philippine Coast Guard; the “Harnessing Agribusiness Opportunities through Robust and Vibrant Entrepreneurship Supportive of Peaceful Transformation” project; the Cavite Industrial Area Flood Risk Management project; the third phase of the Arterial Road Bypass project in Bulacan; the New Bohol Airport Construction and Sustainable Environment Protection project (II); the Metro Rail Transit Line 3 Rehabilitation project and the fourth phase of the Pasig-Marikina River Channel Improvement project.

The three other agreements were the first tranche of the North-South Commuter Railway Extension project loan, the Road Network Development project in conflict-affected areas in Mindanao, as well as the first phase of the Metro Manila Subway project, which is the single biggest venture under the “Build, Build, Build” program according to the statement issued by the Department of Finance. — Beatrice M. Laforga

DTI sets Feb. deadline for Thailand to comply with WTO tobacco ruling

THE Department of Trade and Industry (DTI) said it is giving Thailand until February to comply with the World Trade Organization (WTO) ruling on its customs measures on Philippine cigarette exports before seeking recourse.

Trade Secretary Ramon M. Lopez told reporters after a news conference at New World Makati Hotel Wednesday that he will write a letter to his counterpart in Thailand this month.

“The general tone is for enjoining them to comply with the WTO ruling. We are all supposed to subscribe to the rules. It’s as basic as that. Otherwise, we will look into recourse, into other measures that will be available for us to take,” he said.

The decade-long dispute on Thailand’s fiscal and customs policies on imported cigarettes from the Philippines, where the WTO ruled in favor of the Philippines, is now facing new considerations that could delay Philippine retaliation.

The Thai courts recently fined Philip Morris Thailand $39.7 million after finding the company had undervalued cigarette imports from the Philippines to avoid taxes.

“We are looking closely at the details of that trade court’s decision,” undersecretary Ceferino S. Rodolfo said in the briefing, noting that DTI is now waiting for the official English translation of the decision.

“There was a positive finding with respect to the fines that will be imposed on the Thai importer of Philippine products. In effect, the Thai court decision disregarded [the] WTO case.”

He said that the decision works against the WTO ruling that favors the Philippines. DTI is currently working on communicating with the WTO through the Philippine Mission in Geneva.

The appellate body of the WTO may also not have enough members to function after Dec. 10, following the blocking of appointments from the Trump administration.

“We’re also looking carefully at what will happen to the appellate body of the WTO, because that will also have a material impact on the timelines as to whether Philippines can impose certain actions,” Mr. Rodolfo said.

DTI last month said that it was considering cross-sectoral retaliation against Thailand by the end of December, looking into imposing tariffs or quantitative restrictions on its automotive exports to the Philippines.

Mr. Lopez said Thailand is in the “ASEAN brotherhood of trade partners,” and offered the country a chance to comply with the WTO ruling.

“Tumagal na ‘yung kaso ng 2011 or 2012. (The case has been going on since 2011 or 2012). We’re willing to wait a little more,” he said.

Mr. Rodolfo said that the DTI is looking after the interests of tobacco farmers.

“The Secretary wants to fight for this case — in addition to the Philippine exporters to Thailand, it’s because of the [tobacco] farmers that have been prejudiced by this case.” — Jenina P. Ibañez

PHL among top 5 ‘greenfield’ FDI destinations in Asia

THE Philippines received the fifth-most “greenfield” foreign direct investment (FDI) in the Asia-Pacific, the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) said in a report.

Greenfield investment refers to new projects, as opposed to the expansion of existing projects.

The Foreign Direct Investment Trends and Outlook in Asia and The Pacific 2019/2020 report found that the Asia Pacific for the first time became the largest source and destination for FDI globally.

In 2018, the region attracted 45% of FDI inflows worldwide, and was the source of 52% of outflows.

Greenfield investment into the Asia Pacific is expected to see sluggish growth in 2019, ESCAP said.

“A decline in investment flows in 2020 is expected if the uncertainty related to international trade continues and companies continue to consolidate their value chains.”

The report said that investment prospects for the region are subdued due to the UK’s possible exit from the European Union, the US-China trade war, protectionism, and civil unrest in Hong Kong.

Global FDI flows dropped 13% to $1.3 trillion in 2018.

FDI into the Philippines fell 26% to $6.5 billion in 2018, the largest decline in Southeast Asia.

Rizal Commercial Banking Corp. economist Michael L. Ricafort in an e-mail said that a decline in 2018 FDI was due to a sharp increase in inflation and interest rates, though he called the Philippines a still-attractive destination for FDI amid improved economic and credit fundamentals in recent years.

“Net FDI inflows into the Philippines could pick up/improve especially if both local economic growth and global economic growth improve amid relatively lower interest rates and inflation recently.”

“Any partial/phase one trade deal between the US and China… could fundamentally lead to higher FDIs worldwide.”

ING Bank N.V. Manila senior economist Nicholas Antonio T. Mapa in an e-mail said that in 2019, companies that had previously set up shop in the Philippines continue to plow back their earnings into the country.

“This shows that corporates who are here realize the growth potential of the PHL and view market conditions to be favorable enough to put in more money as opposed to remitting all their earnings back to their mother companies.”

He said that newer FDI has struggled as investors are anxious about tax reform uncertainty.

“Taxes will be lowered but would-be investors are unsure as to how quickly and by how much… the actual list of fiscal incentives, which could be beneficial to the business investment decisions of these corporates, is also not set in stone just yet,” he said.

“Thus, we see a lot of investors waiting on the sidelines before they can actually do their feasibility studies to determine if they should invest, and if they should, by how much.” — Jenina P. Ibañez

At the moment: Know more about ATM fees

For those who dare to do their Christmas shopping at the eleventh hour, the ordeal of treading through Manila’s urban jungle is not for the faint-hearted. Lest one is not forewarned, it is wise to start Christmas shopping early, steering clear of the horrendous rush that can risk spoiling the holiday spirit.

But what if you run out of cash while shopping and your bank’s Automated Teller Machine (ATM) is far from your location? The tendency is to grab cash from the nearest ATM of any other bank, not minding the additional P10 to P15 ATM transaction fee charged to you. After all, searching for your bank’s ATM may entail more cost and inconvenience than paying the ATM fee. But how much do we understand about this fee? Before you insert your card and hit that withdraw button, let me share with you some information about the charges on transactions done via ATM.

With the use of an ATM/debit card, cardholders can easily withdraw money, check their account balance, and even transfer money to other bank accounts or users in just a few clicks. However, there is a price to pay for banking convenience. While not charged by the issuing bank’s ATM terminal (“on-us” transactions), cardholders pay an ATM fee for withdrawals made with another bank (“off-us” transactions) to cover the operational costs of processing.

In 2013, due to the noted industry-wide adjustment in ATM fees, the Bangko Sentral ng Pilipinas (BSP) released a memorandum instructing all banks to maintain the status quo in terms of both service fees and connectivity arrangements concerning their ATM network. The directive was to allow the BSP to conduct a review, in consultation with the banking industry, of the disclosure practice, competition policy, and consumer protection issues applied by the banks to their ATM transactions.

Six years later, in line with the results of the review and the actions taken by the industry, the BSP issued Memorandum No. M-2019-020 on July 19, lifting the moratorium imposed on the ATM fees, subject to the following guidelines:

1. Each participating BSP-supervised financial institution (BSFI) shall file a letter request with the BSP indicating their proposed ATM fees, as well as the costs currently incurred by the BSFI for its ATM activities;

2. Costs declared should be clear and adequately supported, such that when deemed necessary, the same may be validated by the BSP onsite;

3. Setting of fees, including convenience fees, shall adhere to the pricing principles provided under BSP Circular No. 980 dated Nov. 6, whenever applicable;

4. The Acquirer-Based Charging model should already be adopted. To ensure effective implementation of the model, the imposition of fees arising from agreements among BSFIs to fix the fee or have a fixed share in fees shall not be allowed; and

5. Appropriate disclosures on ATM fees shall be provided to the cardholders. The amount to be charged to a cardholder shall be clearly displayed at the ATM’s location and on the screen of the ATM terminal. This is to consist of the fees charged by the acquiring BSFI and the network switch. The notice must clearly indicate that the amount displayed is on top of the charges that may be imposed by the cardholder’s issuer.

Before the issuance of the memorandum, the industry practice on charging ATM fees was the Issuer-Based Charging Method. Under this method, the ATM fee is set and charged by the issuing bank. The amount charged to the cardholder remains the same regardless of the ATM acquiring bank (i.e., the owner of the ATM terminal where the cardholder transacts). The issuing bank shall then pay an interchange fee from the ATM fee collected. Any difference in the amount of the ATM fee and the interchange fee is considered as revenue to the issuing bank and is commonly referred to as Issuer’s Fee. Accordingly, related costs incurred by the issuing bank, such as in the case of reconciliation and fraud-related losses, are charged against the fee.

On the other hand, under the Acquirer-Based Charging Method, the amount that will be charged to the cardholder will vary depending on the ATM terminal used. The fees are to be set by the acquiring bank while the issuing bank, at its option, may likewise charge a separate fee, provided this is properly disclosed to its cardholders. The cardholder is allowed to cancel the transaction if he does not wish to pay the fees, such as may be the case if he believes that an ATM charging a lower fee may be situated nearby.

Based on the memorandum, the acquirer-based charging method allows the ATM owners to directly compete for business with one another by disclosing fees and offering lower charges than other ATMs in the vicinity. This policy introduces a competitive discipline that can bring about efficiencies in the Philippine ATM system which favors the consumer. In line with this, the BSP issued a reminder that BSFIs should ensure adherence to the principle of reasonable and market-based pricing provided under BSP Circular No. 980.

A few months after the lifting of the moratorium, news came out that some banks had won the approval of the BSP to increase their ATM fees but only up to P3 per transaction on average. While it may seem to be a relatively small amount for some, this is not the case for everyone, especially those earning a lower income.

It seems unwise to pay fees for just taking out your own money; after all, it is the depositor’s money that fuels the banking business. Nonetheless, additional fees can be avoided if you plan where and when to make a cash withdrawal and stick with ‘on-us’ transactions. You may also opt to go cashless since many establishments have long been accepting electronic payment transactions. Better yet, stay within your budget to avoid overspending. It’s your hard-earned money, so spend it on necessities or things that matter the most.

The content is for general information purposes only, and should not be used as a substitute for specific advice.

 

Nestine P. Buisan is a Senior Associate at the Tax Services Department of Isla Lipana & Co., the Philippine member firm of the PwC network.

+63 (2) 8845-2728

nestine.p.buisan@pwc.com

PHL breaches 100-medal mark in SEA Games 2019

By Michael Angelo S. Murillo
Senior Reporter

THE PHILIPPINES continued to roll in the 30th Southeast Asian Games, breaching the 100-medal mark just four days into the competition.

Obstacle course racing, weightlifting and shooting delivered gold medals for the host country with silver and bronze medals coming in from lawn bowls, obstacle course racing, gymnastics and muay thai, as of this writing, to push the country’s total medal to 110 — 54 of which were gold.

The Philippine OCR team made a rousing debut by picking up two golds early on Wednesday in the 400-meter mixed team assist (Kyle Antolin, Kaizen dela Serna, Monolito Divina and Deanna Moncada) and mixed team relay (Diana Buhler, Jeffrey Reginio, Klymille Kim Rodriguez and Nathaniel Sanchez) in competitions held at the Filinvest City in Alabang, Muntinlupa.

The team then followed it up with 1-2 finish in the women’s individual 100m event with Rochelle Suarez (46.70) and Milky Mae Tejares (47.88) annexing the gold and silver medals, respectively.

In the men’s 100m event, Kevin Jeffrey Pascua seized the gold with a time of 29.92 seconds. Teammate Mark Julius Rodelas won the bronze.

In weightlifting, Kristel Macrohon gave the second gold from the sport by ruling the women’s 71-kg division at the Ninoy Aquino Stadium in Manila.

Twenty-three-year-old Macrohon followed up on the gold medal victory of Olympian Hidilyn Diaz on Monday, lifting 216 kg (93 kg in the snatch and 123 kg in the clean and jerk) to edge favorite Thi Van Nguyen, who had a total lift of 214 kg (92 kg in the snatch and 122 kg in the clean and jerk).

Indonesian Tsabitha Ramadan settled for the bronze medal with a total lift of 203 kg.

“I’m so overwhelmed. I didn’t expect this because the Vietnamese lifter is really the No. 1 in the division. I thought I could only win a silver. But Hidilyn inspired me to go for the gold,” a jubilant Ms. Macrohon said after her golden performance.

The country’s shooters, for their part, had a golden double with Marly Martir winning the women’s WA 15 Precision Pistol Course event and joining forces with Franchette Shayne Quiroz and Elvie Baldivino to top the women’s WA 1500 PPC Team event.

CUE ARTISTS OFF TO A GOOD START
Meanwhile, billiards players Rubilen Amit and Efren “Bata” Reyes made it a winning debut in this year’s edition of the SEA Games.

Ms. Amit bucked a slow start to edge Siripaporn Nuanthakhamjan of Thailand, 7-5, on Wednesday in the women’s 10-ball singles at the Manila Hotel Tent.

The multiple 8-ball and 9-ball SEA Games champion crawled out a 4-0 hole by winning the next three racks and sustained her momentum after a 5-all tie to advance to the semifinals.

Also advancing to the semifinals was billiards legend Reyes, who dominated Thailand’s Thongchai Punawee, 100 to 37, in the 1-cushion carom quarterfinals.

In men’s football, the Philippine Under-22 team bowed out of the tournament despite beating Timor Leste, 6-1, in its final game in group play at the Biñan Football Stadium in Laguna.

The win went for naught as Cambodia defeated Malaysia, 3-1, in the other Group A match, sending the former to the next round.

The Young Azkals were hoping to beat Timor Leste and for the Cambodia-Malaysia game to end in a draw to advance to the semifinals.

Stephan Schrock, Amani Aguinaldo (hat trick), Mar Diano and Dylan de Bruycker accounted for the goals of the Philippines against Timor Leste.

PHILIPPINES AS BEST SEA GAMES ORGANIZER
Took a lot of flak in the lead-up and early into the Games over what were deemed to be its shaky handling of its affairs, the Philippine Southeast Asia Games Organizing Committee (PHISGOC) got some form of “redemption” after its efforts were recognized at the recent Sports Industry Awards Asia for “organizing the best SEA Games.”

A sports business conference and awards platform, Sports Industry Awards (SPIA) Asia, held at the Grand Hyatt Hotel in Bonifacio Global City in Taguig from Dec. 2 to 3, recognizes and celebrates Asia’s Top 10 in 25 distinct awards categories including the Asia’s Best Sportsman and Asia’s Best Sports Woman category, with Gold, Silver, and Bronze being awarded to the best performers.

SPIA CEO Eric Gottschalk personally handed the award to the PHISGOC Chairman Alan Peter Cayetano and PHISGOC Chief Operating Officer Ramon Suzara.

Team Sibol bullish of chances as SEAG esports events begin

By Michael Angelo S. Murillo
Senior Reporter

ESPORTS events in the 30th Southeast Asian Games formally open today with the Philippine team — Team Sibol — expressing its readiness to plunge into action and bullish of its chances of doing well.

Happening at the FilOil Flying V Centre in San Juan City, esports, which is making its debut in the biennial sporting meet, will see competing nations battle in six game titles, namely, DOTA 2, Starcraft 2, Hearthstone, Tekken 7, Arena of Valor and Mobile Legends: Bang Bang.

Team Sibol will be competing in all of the games, dead-set on making a sweep of the events.

“We are excited and honored to play for the country,” said Team Sibol manager Alvin Juban in an interview in the lead-up to the esports competition.

“Our players have been performing well in the competitions they joined in heading into the SEA Games and we have been getting a lot of support, so we are bullish of our chances,” he added.

Team Sibol is comprised of veterans in their respective games.

Team members are Marvin Salvador “Boomy” Rushton, John Anthony “Natsumi-” Vargas, Bryle Jacob “cml” Alvizo, Jun “Bok” Kanehara, Mc Nicholson “Mac” Villanueva, James “Erice” Guerra and “Van” Jerico Manalaysay (DOTA 2); Caviar “EnDerr” Acampado and Justin “Nuks” Santos (StarCraft 2); and Jacinta “Jia” Dee and Dustin “WaningMoon” Mangulabnan (Hearthstone).

Also part of the squad are Kevin Kio “Gambit” Dizon, Jeremiah “1717” Camarillo, Miguel Klarenz “Miggie” Banaag, Jevan Lorenzo “Bents” Delos Santos, Lawrence Anthony “Rubixx” Gatmaitan, Bradie Ryan “Yatz” Velasquez, and Kyle Jepherson “Vindiicated” Padlan (Arena of Valor); Angelo Kyle “Pheww” Arcangel, Karl Gabriel “KarlTzy” Nepomuceno, Kenneth Jiane “Kenji” Villa, Carlito “Ribo” Jr., Jason Rafael “Jay” Torculas, Jeniel “Haze” Bata-Anon, and Allan Sancio “Lusty” Castromayor (Mobile Legends: Bang Bang); and Andrei Hosea “Doujin” Albar and Alexandre Gabrielle “AK” Laverez (Tekken 7).

As a team, Sibol is rallying behind the battle cry “Lakad Matatag.”

As part of their preparation, team members, with help from Smart, honed further their skills at the Sibol Training Ground, the de facto headquarters of the team which is fitted with the latest mobile network innovations.

It surely bore fruit as Sibol members all took gold medals in DOTA 2, Tekken 7 and Mobile Legends: Bang Bang in the SEA Games test event in November.

As an added incentive in its campaign, Smart and PLDT launched the “Get Gold!” campaign, a cash incentive program for every gold Team Sibol wins.

Under the program, a P2-million cash prize will be given for team events (DOTA 2, Mobile Legends: Bang Bang and Arena of Valor), and P1-million cash prize for individual events (Tekken 7, Hearthstone and Star Craft 2).

“To have esports in the SEA Games is a huge thing for the gaming community here. When this becomes a national sport through the SEA Games, upcoming players will have a new platform to aspire for, a higher goal of representing the country apart from joining competitions for money and prestige,” said Mr. Juban of the significance of having esports in the SEA Games.

PHL Malditas shoot for spot in SEA Games gold medal match

By Michael Angelo S. Murillo
Senior Reporter

THE Philippine women’s national football team tries to go even deeper in the competition in the 30th Southeast Asian Games as it shoots for a spot in the finals against defending champion Vietnam today at the Binan Football Stadium in Laguna.

Set for 8 p.m., the Malditas (1-1-0) look move a step closer to winning the country’s first SEA Games gold in football against a formidable team in Vietnam, a five-time women’s champion, which topped Group B in group play with a record of 1-1-0.

The Philippines is coming off a huge 5-0 victory over Malaysia in its final game in Group A on Nov. 29.

Sarina Bolden scored a hat-trick against the Malaysians to help the Filipina booters secure their place in the semifinals.

Ms. Bolden all scored her goals in the opening half, striking first in the 25th minute and adding two more (42’ and 45+2’) as the first fold drew to a close.

Alisha del Campo added a goal in the 39th minute to make it a 4-0 count for the Malditas at the break.

Malaysia attempted to make the match competitive in the second half but the Philippines continued to be on top of things.

Eva Madarang put the finishing touches on the dominant win by scoring in added time for the 5-0 rout.

“To reach the semifinals is a huge accomplishment for us, especially since we are the host country. We are proud of the players for this achievement and the improvement they have shown,” said national team coach Let Dimzon, adding the work continues for them as they try to make a breakthrough for Philippine football in the biennial sporting meet.

In the history of the Games, the women’s team has only one medal to show for, a bronze in 1985.

Meanwhile, out to frustrate the Malditas is Vietnam, which is off a 6-0 shellacking of Indonesia on Nov. 29.

Featured in the other semifinal pairing are Myanmar and Thailand.

LaLiga working to expand its reach in Asian region

WHILE already have a steady presence in Asia for the past couple of years, Spanish top football division league LaLiga still sees the need to further grow its footing in this part of the world, seeing it as playing a significant part for the organization moving forward.

It is a thrust that LaLiga as a group reaffirmed in the just-concluded Sports Industry Awards Asia 2019 held at the Grand Hyatt Hotel in Bonifacio Global City in Taguig from Dec. 2 to 3.

“We have been working in Asia for two years and we are more than satisfied,” said Ivan Codina, director of LaLiga in Southeast Asia regarding the strategy of the competition in the continent, at the international conference, held for the fifth time and gathered anew hundreds of representatives and speakers from the South Asian sports industry and other countries.

“We carry this out through the three offices we have on the continent and a dozen international delegates. In these different territories we always work with the leagues and the local federations, we collaborate,” he added.

Representatives of the LaLiga teams participated in a panel on the international strategies of clubs, including the Brazilian football legend Ronaldo Nazario, who is now president of Real Valladolid.

Ronaldo shared during the conference that a lot of things are happening in their club and that they are excited to share them with the football fans here in Asia.

“We are changing many things in our club, and one of them is our international reach. We are starting to work internationally; we want to be well known and have people fall in love with our brand,” said Ronaldo, a two-time World Cup champion with Brazil and a highly successful pro player for two decades.

He went on to stay that he is high on LaLiga and that he is happy to be continuously involved in it.

“I have history with LaLiga, I spent seven years playing in the competition. Valladolid is a very special LaLiga club, with history and a lot of potential. It’s a big challenge, and I’m delighted with the decision I took,” he said.

Adding, “LaLiga is more competitive than ever, the clubs are very evenly balanced. And yes, it’s the best league in the world.

For Josep Borrell, commercial strategy coordinator of Valencia CF, Asia’s significance to LaLiga could not be denied, hence, the need to further enhance its presence here.

“Asia is a strategic continent for us, in fact we achieved an audience of 18 million viewers last season and we already have 1.4 million followers in Asia on our social networks,” Mr. Borrell told the conference attendees.

As of now, LaLiga currently has three offices in Asia — Singapore, China and India — as well as 12 delegates working permanently in the Philippines, Vietnam, Malaysia, Japan, South Korea, Hong Kong, Indonesia and Australia, among other territories.

Apart from agreements it has reached with local sponsors and specific social networks in several Asian countries, LaLiga has also signed various deals with local leagues and federations. — Michael Angelo S. Murillo

Tata Steel Rapid and Blitz

Tata Steel Combined Standings
Kolkata, India
Nov. 22–26, 2019

Final Standings (Rapid is considered double)

1. Magnus Carlsen NOR 2870, 27.0/36

2. Hikaru Nakamura USA 2741, 23.0/36

3–4. Anish Giri NED 2776, Wesley So USA 2760, 18.5/36

5. Ding Liren CHN 2801, 18.0/36

6. Ian Nepomniachtchi RUS 2773, 17.0/36

7. Viswanathan Anand IND 2757, 16.0/36

8–9. Pentala Harikrishna IND 2731, Vidit Santosh Gujrathi IND 2722, 14.5/36

10. Levon Aronian ARM 2772, 13.03/36

The 2019 Grand Chess Tour is a series of tournaments (two classical and five rapid/blitz events) where each participant is given GCT (Grand Chess Tour) points depending on how they finish in the individual events. The top 4 players will then go to the London Finals with its very big prizes.

Levon Aronian had been doing well in the 2019 Grand Chess Tour. He was third place in Croatia, first in Saint Louis rapid/blitz, and first in the Bucharest Superbet rapid/blitz event. His performance has been so good that all he needed was one solitary GCT point to guarantee himself entrance to the Grand Finals. Now, since the last-placer in a Grand Chess Tour tournament gets a consolation of one grand prix point, that means that all he had to do is show up in Kolkata and finish the tournament. The blurb was that “even if Aronian finished last he would qualify” Well, finish last he did in Kolkata!

He was not doing too badly in the Rapid section but completely self-destructed in the Blitz. In the first day of blitz he started off with two losses and finished with one win (against Ding), two draws and six losses. The final day of blitz was more of the same: 0 wins 4 draws and 5 losses.

Nothing seemed to go right.

Carlsen, Magnus (2870) — Aronian, Levon (2772) [A28]
Tata Steel India Blitz Kolkata IND (7), 25.11.2019

1.c4 Nf6 2.Nc3 e5 3.Nf3 Nc6 4.d3 d5 5.cxd5 Nxd5 6.e4 Nb6 7.Be2 Be7 8.Be3 0–0 9.0–0 Be6 10.a4 a6 11.a5 Nd7 12.d4 exd4 13.Nxd4 Nxd4 14.Bxd4 Nc5 15.Be3 Qxd1 16.Rfxd1 Rfd8 17.Nd5 Bxd5 18.exd5 Nd7 19.Bf4 Bd6 20.Bxd6 cxd6 21.Rac1 Nf6 22.Rc7 Rab8 23.Bf3 b6 24.b4 bxa5 25.bxa5 Rb5 26.Ra1 Nxd5 27.Bxd5 Rxd5 28.Ra7 g6 29.h3 Rb8 30.Rxa6 Kg7?

A bad tempo loss. Aronian should have gone right away with 30…Rd2 31.Rf1 (31.Rb6 Rxb6 32.axb6 Rb2 33.Ra8+ Kg7 34.Rb8 Kf6 35.b7 d5 is a draw as well) 31…Rbb2 32.Rc6 Ra2 33.a6 Kg7 when both sides are deadlocked.

31.Rc6 Rb2 32.a6 Rdd2 33.a7 Rxf2 <D>

POSITION AFTER 33…RXF2

34.Rc2!!

The only winning move. 34.a8Q with the idea of putting his king on the c-file where it is defended by his own rook does not work. Black will continue 34…Rxg2+ 35.Kf1 Rbf2+ 36.Ke1 Re2+! 37.Kd1 Ref2! 38.Ke1 (otherwise he is mated on the back rank) 38…Re2+ 39.Kd1 Ref2= draw.

34…Rbxc2 35.a8Q

Now the queen defends the g2 square and white wins.

35…h5 36.Qe4 Rce2 37.Qd4+ Rf6 38.Rf1 Re5 39.Rxf6 Kxf6 40.Qxd6+ Re6 41.Qf8 Re5 42.Kf2 Rf5+ 43.Ke3 Re5+ 44.Kd4 Re2 45.g4 hxg4 46.hxg4 Rg2 47.Qh8+ Ke7

Black has to defend his f7–pawn to try and set up a fortress which the white queen cannot penetrate. If 47…Kg5 48.Qd8+ Kxg4 49.Qf6 the pawns fall.

48.Qh3 Rd2+ 49.Ke5 Re2+ 50.Kf4 Re6 51.Kg5 Re5+ 52.Kh6 g5 53.Kg7 Re6 54.Qa3+ Ke8 55.Qa8+ Ke7 56.Qb7+ 1–0

After the tournament concluded the top four of the Tour were announced — Magnus Carlsen, Ding Liren, Levon Aronian and Maxime Vachier-Lagrave. They are currently in London to contest the $350,000 (about P17.8 million) Grand Chess Tour finals which started last Dec. 2 at the Olympiad London. The winner will take home $150,000 (P7.6 million).

You might recall that back in 2017 there was a 30-game in rapid, blitz, and bullet between Magnus and Ding Liren in the chess.com speed challenge. Carlsen won that one by a mile, scoring 22-8. It now appears that Ding has fully recovered from that beating.

In the Sinquefield Cup last June held in Saint Louis the two of them tied for first and played a rapid tie-break match which Ding surprisingly won 3:1. Here in Kolkata we saw more of the same. Despite his rampaging form Carlsen lost two games across the rapid and blitz phases of the event and both of them were against Ding Liren. The Chinese GM forced Magnus to resign in both moves a few moves away from mate. Here is one of them.

Carlsen, Magnus (2870) — Ding, Liren (2801) [C85]
Tata Steel Rapid & Blitz (14), 25.11.2019

1.e4 e5 2.Nf3 Nc6 3.Bb5 a6 4.Ba4 Nf6 5.0–0 Be7 6.Bxc6 dxc6 7.d3 Nd7 8.Nbd2 0–0 9.a4

A sideline. The most popular way to play this is 9.Nc4 f6 10.Nh4 Nc5 11.Nf5 Bxf5 12.exf5 although, I should add, back in the 1970s the Yugoslav GMs Mato Damjanovic and Bruno Parma used to play this line for White whenever they were content with a short draw.

9…a5 10.b3 f6 11.Nh4 Nc5 12.Nf5 Ne6 13.Nc4 b6 14.Nxe7+ Qxe7 15.Ne3 g6 16.Bb2 c5 17.Qd2 Bb7 18.Rae1 Rad8 19.f3

Intending to move his queen into the kingside with Qd2–f2–h4.

19…Kf7!

Ding has the inspired idea of tucking away his king in c8 and then he will be the one to attack the kingside.

20.Qf2 Ke8 21.Qh4 Kd7 22.f4!?

Good move but then White does not follow-up properly.

22…Nxf4 23.Rxf4?

Magnus badly underestimates Black’s counter-attacking potential. Better was 23.g3 Ne6 24.Rf2 with the follow-up Re1–f1 and Ng4, putting pressure on the f6–pawn which cannot be held.

23…exf4 24.Ng4 g5 25.Qh6 Qe6 26.Nxf6+ Kc8 27.Qxg5 f3! 28.Rf1

[28.gxf3? Rg8 29.Nxg8 Rxg8 30.Bg7 Qf7 Black wins]

28…Rg8 29.Nxg8 Rxg8 30.Qe5 Rxg2+ 31.Kh1 Qg6 32.h4 Bc6

A safety valve move so that in case of any checks the king can hide on b7.

33.Qf4 Rxc2 34.Rg1 Rg2 35.Qe3 Qg3 0–1

The sad story from Kolkata came from the Vishy Anand camp. He could have qualified for the London Finals had he finished at least in 6th place. The huge crowds in Kolkata knew this and of course wanted their hero to do well. In the first few days of the tournament he was in good form and appeared to be on the way to clinch the required place. However, disaster occurred in the last day when he blundered against Vidit and lost on time in a better position against Anish Giri. At the end Anand finished in 7th place and in his stead it was Maxime Vachier-Lagrave who qualified for London.

The following game illustrates how frustrating it must have been for Vishy — he plays very well and whips up a surprise attack that would have succeeded against lesser opposite Magnus Carlsen is remorselessly accurate, takes advantage of all tiny slips and brings home the victory.

Carlsen, Magnus (2870) — Anand, Viswanathan (2757) [D38]
Tata Steel GCT Rapid Kolkata IND (7), 24.11.2019

1.d4 Nf6 2.c4 e6 3.Nc3 Bb4 4.Nf3 d5 5.cxd5 exd5 6.Bg5 h6 7.Bh4 0–0 8.e3 Bf5 9.Nd2

The idea, of course, is Bxf6 when Black will have to recapture with the g-pawn because if …Qxf6 then Nxd5.

9…g5 10.Bg3 c5! 11.a3

[11.dxc5 d4 12.exd4 Nc6 13.Nf3 Re8+ 14.Be2 Ne4 White is under a lot of pressure, for example he cannot play 15.0–0? because of 15…Bxc3 16.bxc3 Nxc3 and the e2–bishop falls]

11…Bxc3 12.bxc3 c4 13.h4!

White has a brief respite while Black is gathering a second wind, so he goes after the opposing king.

13…g4 14.h5 Nbd7 15.Bf4 Qa5!?

Vishy goes for the throat rather than defending his h6–pawn with 15…Kh7 although objectively that might be the better course.

16.Qc1

[16.Bxh6 Rfe8 17.Qc1 Nb6 transposes back into the game]

16…Nb6 17.Bxh6 Na4 18.Bxf8 Rxf8

The c3–pawn cannot be saved. Carlsen goes for counterplay.

19.f3! Re8?

Best probably is 19…g3!? to take away the f2 square from the king.

20.Kf2! b5

Another inaccuracy. It is quite possible that Anand intended to play 20…g3+ 21.Kxg3 Rxe3 but only now noticed that it is refuted by 22.Nxc4!

21.e4!

Magnus takes advantage of all of your mistakes. The problem with 20…b5 was that it blocked the black queen’s passage to the kingside along the 5th rank, so White uses his chance and opens up the center for his own queen to join in the kingside attack.

21…dxe4 22.Nxc4! bxc4 23.Qg5+ Kh7?

[23…Kf8! 24.Qxf6 e3+! 25.Kg1 Re6 26.Qh8+ Ke7 White is still better but at least Black is fighting]

24.Qxf6 e3+ 25.Kg1 Be6

[25…e2 26.h6! Rg8 27.Qxf7+ Kh8 28.h7 it will be mate soon]

26.d5 Qxd5 27.Re1 Qd2 28.Re2 Qc1 29.Qd4 gxf3 30.Qxe3 Qxc3 31.gxf3 Rg8+ 32.Kf2 Qg7 33.Qe4+ Kh6 34.Qf4+ Kh7 35.Qe5! Qh6 36.Rg1 Rc8 37.Qe4+ Kh8 38.Qd4+ Kh7 39.Rxe6! [39.Rxe6 fxe6 40.Qd7+ Kh8 41.Qxc8+ Kh7 42.Qg8#] 1–0

Bad luck for Vishy but for Vachier-Lagrave this might be a good omen – immediately after the London Grand Chess Tour Finals he will be playing in the Jerusalem Grand Prix tournament from Dec. 10–24 where he has to finish high up in the standings to qualify for the March 2020 Candidates Tournament in Yekaterinburg, Russia. Will everything finally fall into place for the French star? Soon we will see.

 

Bobby Ang is a founding member of the National Chess Federation of the Philippines (NCFP) and its first Executive Director. A Certified Public Accountant (CPA), he taught accounting in the University of Santo Tomas (UST) for 25 years and is currently Chief Audit Executive of the Equicom Group of Companies.

bobby@cpamd.net

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