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New Michelin replacement tire touts affordability, durability

Text and photos by Kap Maceda Aguila

ALREADY AMONG the leaders in the mass-market tire segment for eight consecutive years, French tiremaker Michelin goes after a bigger portion of the tire-replacement business with an affordable yet high-performing line designed for small to medium-sized vehicles.

The Michelin Energy XM2+, priced from around P3,000, is developed for “young, budget-conscious consumers looking for tires with safety and performance that last,” according to a company release. The company’s chief representative to the Philippines Michael Nunag said during the line’s recent launch that among the challenges is “to keep up with new subcompact cars which are getting bigger,” with tires that deliver longevity and performance. This move for the company surely makes sense as it noted that subcompact and compact car sales across the region (including the Philippines) continue to rise.

Already available in the brand’s dealers and associate dealers, the Energy XM2+ line banners a full-silica rubber compound which, reported Mr. Nunag, “actually strengthens the rubber molecules and filler (while making them) highly flexible to adapt to contours of the road.” The tread features full-depth, large channels to keep the depth of the grooves even when worn out. The design also effectively disperses water to prevent hydroplaning, even as it cuts down on noise.

He continued, “The ‘+’ sign on the sidewall denotes the rubber compound upgrade that is behind the braking superiority of the… Energy XM2+ versus its predecessor. The tire also maintains the green ‘X’ marking of its predecessor, indicating optimized fuel savings. We hope the combination of enhanced safety and superior value-for-money will particularly appeal to the younger consumers.”

The tire is said to deliver shorter wet-braking distance from 80kph to standstill (by 1.5 meters) when new, and even shorter braking distance (by 2.6 meters) when worn, compared to competitors. The Energy XM2+ has also been tested to last 25% longer than other premium tire manufacturers. These findings were revealed by independent testers TUV Rheinland Thailand Ltd and China Automotive Technology and Research Center Co. Ltd, whose services were contracted by Michelin.

Mr. Nunag asserted that the French tiremaker’s key design philosophy is safety while assuring longevity. “We’re pushing the boundaries… (to make sure) that this will perform down to the last millimeter of your tread.” He added, “I haven’t seen any manufacturer doing tests with worn-out tires.”

Replying to a question from Velocity, Mr. Nunag revealed that around 80% of the domestic supply is sourced from Thailand, and points to Michelin’s six-year worldwide warranty as additional proof of quality.

The new Energy XM2+ is positioned as being suitable for Philippine road conditions, and now becomes the entry point to the Michelin portfolio. A total of 36 sizes, from 14 to 16 inches in diameter, are available. According to Michelin, it should fit vehicles such as the Honda Brio, Honda City, Honda Jazz, Honda BR-V, Honda Mobilio, Honda Civic, Toyota Wigo, Toyota Vios, Toyota Yaris, Toyota Altis, Toyota Avanza, Toyota Innova, Mitsubishi Mirage, Mitsubishi Mirage G4, Mitsubishi Lancer EX, Mitsubishi Xpander, Hyundai i10, Hyundai Accent, Hyundai Elantra, Suzuki Celerio, Suzuki Swift, Suzuki Ertiga, Nissan Almera, Nissan Altima, Nissan Juke, Mazda 2 and Mazda 5. For more information, visit www.michelin.com.ph.

Meat processors expect supply crunch if government moves to ban pork imports

MEAT processors said they expect supply to be pressured if the government responds to demands from sections of the agriculture industry to ban pork imports.

Farm groups are asking the government to ban pork imports and implement a stricter quarantine regime to prevent the spread of African Swine Fever (ASF) after infected hogs were found in Rizal, Bulacan and Quezon City.

Some provinces have responded to the panic by restricting the inward movements of pork products entirely to protect thir hog industries

“You could zone geographically, but you cannot zone economically,” Rex B. Agarrado, spokesperson of the Philippine Association of Meat Processors, Inc. (PAMPI), told reporters after the group’s news conference.

“What I mean is hatiin mo ‘yung (if you divide the) area, madali (it’s easy),” though it will mean regional specialty meats like tocino will be in short supply in may areas while remaining in surplus in Pampanga, a major producer.

The Department of Agriculture (DA) has implemented a so-called 1-7-10 protocol, under which all hogs within one klometer are culled and buried, while those within a seven-kilometer radius are prevented from leaving the area and animal movements are monitored within an outer ring of 10 kilonmeters.

Cebu and Bohol provinces have both declared a total ban on the shipment of pork and pork products from outside their borders.

Agriculture Secretary William D. Dar has appealed to the provincial governments to reconsider their total ban.

“In these trying times, particularly in protecting our shores from the challenges of major diseases such as ASF, we appeal for unity and brotherhood among our countrymen, most particularly our local chief executives,” he said in a statement.

“While we wish to protect our respective borders, we should not limit the movement of goods, most particularly food,” he added.

The Philippine Chamber of Agriculture and Food Inc. (PCAFI) has said that the government should suspend pork imports until it is able to come up with a better biosecurity system.

“That policy will not only ensure animal protection from ASF infection. It will also ensure that proper tariffs and duties are paid,” it said in a statement.

“The Bureau of Customs (BoC) currently does not have the full capability to carry out strict biosecurity system that will guarantee that no imported meat products infected with ASF will enter the country,” it said.

The Samahang Industriya ng Agrikultura (SINAG) has also asked the Department of Agriculture to immediately suspend imports of pork and pork products.

Mr. Agarrado of the meat processors’ association expressed the group’s opposition to such an action since this will affect its members’ production of pork products, since the industry needs to import much of its raw materials.

“It [ban of imports] is not the solution. This is not something that can be managed by closing borders,” he said.

Meanwhile, he said supervision over the movements of processed meat products should be returned to the DA, after it had been transferred to the Food and Drug Administration by Republic Act No. 10611, or the Food Safety Act of 2013.

He said that a bill was filed in Congress about three weeks ago to amend the law.

Meat processors also warned that some members have decided to reduce production for the year-end holidays due to uncertainty over restrictions to meat distribution. One company has decided to halt production entirely. Jerome D. Ong, president and chief executive officer of Foodsphere, Inc. said that the company is reducing its production of Christmas ham by 15-20%. — Vincent Mariel P. Galang

What is good design?

IF TIME were a true test of anything, then objects may matter more than we do. We would be long dead and gone, but the objects we would have acquired through the years will still be gathering dust by the time we would have turned into it.

The International Design Conference was held on Sept. 20 in Makati, staged by the Design Center of the Philippines. The conference saw the culmination of the IDC Pitching Session, in which four teams of young, bold thinkers presented their best ideas on how to use design as a force for good. In front of a powerhouse panel of industry leaders and the Conference audience, Greg Balondo (arkayv.com), Gerome Sta.Maria (Diwata), Dean Cuanso (Bespoke Forever Wedding Bouquet), and Marthy Angue (Catwander) pitched how they intended to innovate to change the world. Diwata emerged as the winner for a collection of women’s footwear and other fashion accessories using marine plastics.

Among the speakers at the conference was Jacob Jensen Designs Shanghai Chief Operating Officer Manuel Veiga Aldemira who discussed the design principles that guide their institution.

The design studios, with a presence in Denmark, Shanghai, and Bangkok, were founded by Jacob Jensen, a leading designer of the Danish Modern period and the last of his generation, dying in 2015. Jacob Jensen’s imprimatur can be found in television sets, mobile phones, household goods, and even coffins.

THE TEST OF TIME
Mr. Aldemira noted the importance of sustainable design in the forefront of the fourth Industrial Revolution, marked with advances in digital technology. “A big part of sustainable design is actually durability: to create goods that are not made to be disposed of, products that have intrinsic quality, and that withstand the test of time.”

Mr. Aldemira said that part of the late Jacob Jensen’s principles included that good design should be different, but not strange. Good design is innovation, but not innovations for its own sake, rather innovation that exists to improve existing products. “Innovation for the sake of innovation often shows that it’s rejected to a certain degree by the audiences it’s presented to.”

Because the fourth Industrial Revolution rests on our reliance to information technology, with a nexus to it usually in our very own hands, perhaps it’s time to accept certain things. “Gadgets are a part of our life,” noted Mr. Aldemira. “We build relationships with them.”

“As such, design should trigger certain emotions for those that hold them,” he said. This rests on three categories: distance, closeness, and touch. Really, by the way he talks about it, it sounds like a courtship or a seduction, hammering home the point of emotive design. “Good design should attract you from a distance,” he noted. “There has to be a different element that is appealing.”

In approaching the object, you discover more appealing elements to it, and then, “When you interact with it, that’s when you discover the, say, magic of it.”

In accepting that objects are extensions of ourselves, we begin to see that design is less a frivolous pursuit but a serious discipline aimed at building ourselves and the world. As such Mr. Aldemira talked about the values instilled in good design. He said that design should include contrasts, because it communicates with you, and makes you more intuitive to the needs of the end-user. Good design should also be honest, meaning things are not added for the sake of it, or because they are, as he phrases it, “cool.”

“Everything is to have a purpose. Everything needs to be there for a reason.”

“Good design is value-based,” he said. “When everything that you do [depends on] a very strong, solid foundation, and a personal set of values, it withstands the test of time.” — Joseph L. Garcia

Reissued 20-year bonds to fetch slightly higher rate ahead of BSP

RATES of the Treasury bonds (T-bond) on offer tomorrow will likely move sideways amid expectations of an interest rate cut when the Bangko Sentral ng Pilipinas (BSP) meets this week, as well as bets of further reductions to big banks’ reserve requirement ratio (RRR).

The Bureau of the Treasury (BTr) will offer P20 billion worth of reissued 20-year bonds on Tuesday with a remaining life of 19 years and four months. The bonds carry a coupon rate of 6.75%.

One bond trader said the 20-year papers may fetch an average rate from 5.125% to 5.25%, while another said its yield may fall within 5.15% to 5.3%.

“We’re expecting 5.125% to 5.25%, around the market rate given that the BSP (Bangko Sentral ng Pilipinas) is expected to cut its policy rate on the Sept. 26 meeting as well as a possible RRR cut…,” the first trader said by phone on Friday.

“It’s more of [the] market waiting… This is a test of market demand,” the trader added.

The second trader said the 20-year bonds’ rate may fall within a slightly higher range as the market is pricing in the anticipated benchmark rate cut by the central bank.

“For the 20-year auction, we expect yields to trade within 5.15% to 5.3%. Meron pa rin namang (There is still) interest in the long end but we expect the market to price in the expectation of possible action by the BSP [this] week,” the second trader said on Friday.

The government fully awarded P20-billion worth of the reissued 20-year papers when they were offered last July 30. The bonds fetched an average rate of 5.015% at that auction, 15.5 basis points (bp) lower than the 5.17% quoted when the debt papers were offered on June 11. Total bids reached P29.814 billion.

Meanwhile, at the secondary market on Friday, the 20-year bonds were quoted at 5.201%, based on the PHP Bloomberg Valuation Service Reference Rates published on the Philippine Dealing System’s website.

The BSP’s Monetary Board will meet to revisit policy settings on Thursday.

The central bank has cut rates by a total of 50 bps this year — by 25 bps each last May 9 and Aug. 8 — to 4.25% for the overnight reverse repurchase rate, 4.75% for overnight lending and 3.75% for overnight deposit, partially dialing back the 175-bp cumulative hikes triggered last year by successive multi-year high inflation that peaked at a nine-year high.

BSP Governor Benjamin E. Diokno earlier said the central bank’s plan to cut interest rates anew “won’t reach November.”

Mr. Diokno has said the central bank is looking to cut policy rates by another 25 bps as well as slash big banks’ RRR before the year ends.

Currently, the RRR is at 16% for big banks and six percent for thrift banks following the phased 200-bp cut implemented after an off-cycle meeting last May. The reserve ratio of rural and cooperative lenders was also cut to four percent from five percent effective May 31.

Last week, Mr. Diokno said the BSP may cut big banks’ reserve ratio by another 100 bps before the year ends.

The government is set to borrow P230 billion from the domestic market this quarter through Treasury bills and T-bonds.

It wants to raise P1.189 trillion this year from local and foreign sources to fund its budget deficit, which is expected to widen to as much as 3.2% of gross domestic product. — Beatrice M. Laforga

Investors unload Phinma Energy Corp. shares after the planned stock rights offering

Phinma

By Marissa Mae M. Ramos
Researcher

NEWS of Phinma Energy Corp.’s (now AC Energy Philippines, Inc.) plans to fuel its expansion through a stock rights offering (SRO) made the stock one of the most actively traded last week.

Data from the Philippine Stock Exchange showed the listed energy firm trading P413.267 million worth of 149.288 million shares from Sept. 16-20.

Shares closed at P2.69 apiece on Friday, 8.8% down week on week from its P2.95 per share finish on Sept. 13. For the year, the stock gained 133.91%.

“[Phinma Energy Corp.] was among the most active stocks [last] week as investors sold on the news about its planned capital raising via SRO next year to fund the $2 billion spending plan to become the leader in renewable energy by 2025,” said Unicapital Securities, Inc. technical analyst Cristopher Adrian T. San Pedro in an e-mail.

Mr. San Pedro explained that the move concerned investors as SROs can cause stock dilution.

“[SRO] leads to dilution, which results in a decrease of an existing stockholder’s ownership percentage of that company. Another thing to consider is that the company’s earnings per share decreases as the allocated earnings result in share dilution,” he said.

Last Tuesday, AC Energy Philippines President and Chief Executive Officer Eric T. Francia told shareholders during their annual meeting of the company’s goal of being “the leader in renewable energy in the country.” The firm looks to reach its target of 2,000-megawatts of renewable energy capacity by 2025.

To finance its capital expenditures of $2 billion in the next six years, Mr. Francia told reporters that the fund-raising would be conducted through an SRO. The terms would be decided by management on Oct. 9.

If approved, the company expects to receive the proceeds from the SRO “sometime [in the] first or second quarter next year,” said Mr. Francia.

The annual meeting last Tuesday also saw shareholders approved the renaming of the listed firm to AC Energy Philippines, Inc. as well as the company’s plan to increase its capitalization to P24.4 billion from P8.4 billion.

To recall, AC Energy, Inc. announced in January that it was taking control of Phinma Energy through a “mutually strategic agreement” that gives the Ayala-led firm a 51.48% stake in the listed energy company for P3.42 billion. The acquisition was completed on June 24.

“They have also disclosed that AC Energy, Inc. will be injecting some of its Philippine assets into AC Energy Philippines… Valuation of the assets here is key,” RCBC Securities, Inc. equity analyst Jeffrey Lucero said in an e-mail.

For Philstocks Financial, Inc. senior research analyst Japhet Louis O. Tantiangco, the stock’s price movement was attributed to profit-taking “amid a worrisome general market sentiment.”

“We did see a 3.77% surge in [the company’s] share price last Sept. 18 following its announced plan to allocate $2 billion for its renewable energy projects. This was cancelled out in the next two trading days, however, as general market uncertainties continued to linger,” Mr. Tantiangco said in a separate e-mail.

In the second quarter, Phinma Energy’s attributable net loss widened by 344% to P406.6 million from P91.57 million in the same quarter last year.

Philstocks’ Mr. Tantiangco said the company’s earnings “could remain depressed” for the rest of the year, but that it may recover in the long run as “it is already being combined with AC Energy, which would give it more operational capacity.”

Mr. Tantiangco pegs the stock’s support at P2.20 apiece while initial resistance is at P2.80 and next resistance at P3 per share.

“Its 50-day exponential moving average also serves as a dynamic support which is expected to be tested in the upcoming trading days. If it holds, then [Phinma Energy] may continue with its uptrend,” said Mr. Tantiangco.

For RCBC Securities research head Raul P. Ruiz, support and immediate resistance is at around P2.69 and P3, respectively.

“The stock encountered heavy selling primarily by local players early in the week, but found support at around the P2.50 level. It might consolidate over the next few days before attempting a retest of the P3.00 resistance,” Mr. Ruiz said in an e-mail.

Unicapital’s Mr. San Pedro expects “the stock to consolidate between P2.60 support and P2.92 resistance in the short term.”

“A bearish scenario to test the support levels at P2.40 and P2.45 might happen if the stock falls below P2.60,” Mr. San Pedro said.

Buyers enjoy huge deals at Foton’s Big AtTRUCKtion

By Manny N. de los Reyes

THE RAINS poured down, and so did a shower of great deals and discounts at FOTON Motor Philippines’ (FMPI) Big AtTRUCKtion held last Sept. 12-13, at the Megatent Events Venue in Libis, Quezon City.

FOTON’s Biggest Truck Sale of the Year’s ribbon-cutting ceremony was headed by FMPI Vice-Chairman Kenneth Sytin, Anna Dominique Sytin, Nicole Sytin, Undersecretary for Road Transport and Infrastructure Mark De Leon, and FOTON International Group Representative Eric Zhang.

“For this event, FOTON will be showcasing the segment which our brand has been known for — trucks. But we do not want this to be merely a vehicle exhibit where guests would just pass by and see how big wheelers can get. Instead, we longed to show a grand atTRUCKtion — a sight where function can both be seen and experienced, where doors to bigger opportunities can be found, and held within reach,” said FMPI Vice-Chairman Kenneth Sytin.

All vehicles exhibited in the two-day expo are powered by the brand’s latest technology advancement, the Blue Energy Euro 4 generation. FOTON’s Blue Energy vehicles are powered by a Cummins ISF turbocharged intercooled diesel engines using an electronic high-pressure Bosch common rail direct fuel injection (CRDi) system and electronic gas recirculation exhaust system with a diesel oxidation catalyst for highly improved emissions.

This technology is applied not only to its passenger vehicles, but also to its light- to heavy-duty trucks. For its outdoor display, FOTON showcased the Tornado light-duty trucks with special bodies, its Wing Van lineup, Dump Truck models, and Crane Truck body configurations.

“Today, we announce that we are now ready to further up the ante in light-, medium-, and heavy-duty trucks with game-changing contenders — the M Series, including the Tornado M and EST-M trucks,” exclaimed FMPI Vice-President for Sales and Marketing Levy Santos at the event. “FOTON Philippines understands the importance of being able to move a large number of people reliably, safely as well as with care for the environment. We are proud to be one of the anchors of this program, as we see the role of the F-Jeepney as a workhorse and multi-functional partner for the growing number of PUV operators in the country,” added Mr. Santos.

Armed with the goal to reach out to those new opportunity seekers in the provincial areas, Mr. Santos announced that FOTON will be also holding a nationwide regional Big AtTRUCKtion tour in North Luzon, Visayas, and Mindanao.

Noted Mr. Santos, “Our collective hard work, through our fleet sales, financing deals, product development, and growing number of trusting dealer networks have become major factors why we continue to be part of the top. We have maintained our market share, and will consistently do our best to beat our records.”

“Your All-Day Logistics Partner” and “Your Cold Chain Partner” badges were also emphasized through the Tornado M5.2C F-Van and M4.2C F-Van displays, respectively. These trucks were also showcased inside the tent along with the Gratour series composed of the 8-seater MiniVan and MT MPV body configuration suitable for micro, small, and medium enterprises.

Apart from the trucks, FOTON’s best-selling vans also took part at the Big AtTRUCKtion. First up was the Toano executive van that became popular for its luxurious build, homey interiors, rotating captain’s chairs, and premium entertainment perfect for VIP shuttle services in airport and hotels.

Representing the Traveller line was its XL variant, which boasts of its extended legroom, bubble top, and seating capacity of 19. From a commuter van that could carry up to 15 people, the TransVan took it a notch higher with a new model, the 16-seater TransVan HR, with augmented headroom similar to the Traveller. There was also the TransVan HR ambulance, customized as a first emergency assistance responder.

Despite the wet weather conditions during the event, guests still took the chance to test-drive the trucks and experience its riding comfort and functions. Attached to light-, medium- and heavy-duty cabs, the bodies of these trucks are classified as dropside, F-Van, dump truck and tractor head.

In his speech during the opening ceremony, Transport Usec. De Leon extended his gratitude to FOTON for continuously supporting the government’s PUV modernization program. “Salamat sa FOTON,” he repeatedly said pertaining to the brand’s participation in building innovative public utility vehicles for the development of the Philippine transportation system through the launch of the F-Jeepney, that currently holds two variants: the F24 and F29.

To avail exclusive zero DP offers, low monthly deals, truck test drives and cash discounts up to P300,000, FOTON invites all business owners, transport operators, logistics providers and families to watch out for the following schedules for the FOTON’s Big AtTRUCKtion regional tours: North Luzon leg will be held on Sept. 26-27 at San Fernando Town Plaza in La Union; Mindanao leg on Oct. 9-10 at Kauswagan Highway in Cagayan De Oro, and Visayas leg on Oct. 18-19 at SM City Cebu Event Center.

Davao Oriental restricts pork inbound shipments from swine fever-affected areas

DAVAO CITY — Gov. Nelson L. Dayanghirang of Davao Oriental issued last week an order banning the entry of swine and pork products where African Swine Fever (ASF) has been detected.

According to Mr. Dayanghirang’s Executive Order 29, restricted items include “all swine or pork-related products and by-products whether edible or non-edible, whether raw, processed or cooked, including but not limited frozen boar semen” from areas that have ASF cases.

Also included in the ban are canned goods from these areas.

The order also called on hog farms to stop feeding their pigs with swill, or leftover food, as swill-feeding has been found to encourage the spread of the disease.

The provincial veterinarian Eric R. Dagmang has said that the province is still free from the disease.

“There is no reason to worry. The cases are confined in areas of Luzon, particularly Rizal and Bulacan,” Mr. Dagmang said.

The provincial government has also created a body that will strengthen its preventive measures against ASF — Carmelito Q. Francisco

Mindanao rice farmers sign deals to supply organic, premium rice

By Carmelito Q. Francisco
Correspondent

DAVAO CITY — A supply deal has been signed between Mindanao organic rice farmers and a US buying group for rarities of organic rice varieties, the Mindanao Development Authority (MinDA) said.

MinDA, in a statement, also said that a Papua New Guinea delegation, headed by Central Province Gov. Robert Agrobe, has arrived to inspect production areas for premium rice.

The agency helped arrange a marketing agreement between premium rice farmers and PNG. An initial supply of about 5,000 tons is expected to be sent to PNG before the end of the year.

MinDA quoted Andrew Bolougne, head of the US group, as telling the farmers: “Produce as much as you can and we will market it.”

It added that Mr. Bolougne’s group is also facilitating the export of green and mature coconut to the US market.

Mr. Bolougne said demand for organic rice, particularly the so-called Black Rice, has been high because of their benefits compared with white rice.

“You cannot imagine how huge is the market demand for organic food today and we will cash in on that,” he added, promising that his group will commit to buy the produce at prices that will provide the farmers better income compared with traditional rice varieties.

The deal will involve the marketing of an “unlimited volume of White, Brown, Red and Black Rice.”

The agreement emerged from a forum MinDA organized in cooperation with Seedworks Philippines Inc. which was also attended by farmer groups in Mindanao.

Another result of the forum was the formation of the Mindanao Organic Rice Council.

MinDA also announced it will set up a database of organic rice farmers in Mindanao, and geotagging their farms.

Among the key challenges facing the traditional rice industry is the Rice Tariffication Law, which allows the entry of cheap foreign rice from more competitive rice producers in Southeast Asia.

The Don Bosco Multi-Purpose Cooperative in North Cotabato, one of the few groups in Mindanao selling organic rice, said that the organic rice industry cannot meet domestic demand.

Maria Helenita Gamela, vice chair and marketing officer of the coo-op, said organic farmers continue to enjoy better income compared to growers of traditional rice because their crop is higher value.

“We have a niche market. The price is steady whole year round but we cannot produce the needed volume,” Ms. Gamela said.

The cooperative is buying unmilled rice from its members for as much as P20 a kilogram, compared with the government support price of P17 for white rice, and she expects export agreements to push the price higher.

Yields on gov’t securities inch up on US-China, Fed

By Mark T. Amoguis
Senior Researcher

YIELDS ON government securities (GS) went sideways last week as the trade spat between the United States and China eased ahead of the meeting between the two countries’ trade deputies.

GS yields, which move opposite to prices, went up by an average of 4.3 basis points (bp) week-on-week, according to the PHP Bloomberg Valuation Service Reference Rates as of Sept. 20 published on the Philippine Dealing System’s Web site.

“GS yields increased by an average of 4.3 basis points week on week, mostly due to US Treasuries reaching a multi-year high on less global economic noise, i.e. positive data from the US including the easing of tensions of the trade war between China and the United States,” Carlyn Therese X. Dulay, first vice-president and head of Wholesale Treasury Sales at Security Bank Corp, said in an e-mail interview.

“Market participants also took profit on their holdings as market seems to have fully priced in the remaining BSP (Bangko Sentral ng Pilipinas) moves for 2019,” she added.

“Local participants have started to take profits from the recent surge in bond prices in the previous weeks, which was further bolstered by the easing US-China trade tensions,” a bond trader said in a separate e-mail interview.

“The local bond market viewed the moves from the latest Fed meeting as relatively hawkish, due to the apparent divergence of opinion among various Fed officials regarding to the appropriate monetary action necessary for the US economy. This has contributed further to the climb in bond yields despite the recent Fed rate cut,” the bond trader said.

Officials from the world’s two largest economies met on Thursday to lay the groundwork for high-level talks in October that will determine whether the US and China are working toward a solution or headed for new and higher tit-for-tat tariffs.

A delegation of about 30 Chinese officials, led by Vice Finance Minister Liao Min, met counterparts at the US Trade Representative’s (USTR) office near the White House. Deputy USTR Jeffrey Gerrish led the US delegation.

To date, US has slapped 25% tariffs on some $250 billion of Chinese products, and China has retaliated with tariffs on $110 billion of US imports.

The US is scheduled to raise existing tariffs to 30% on Oct. 15, and tax another $156 billion worth of Chinese-made products in December, including $43 billion worth of cell phones.

Meanwhile, at the end of its two-day meeting last Sept. 18, the US Federal Reserve’s policy-setting Federal Open Market Committee cut benchmark interest rates for the second time this year by 25 bps to a range of 1.75% to 2% “to provide insurance against ongoing risks,” Fed Chair Jerome Powell said.

Bond yields increased across the board at the close of trading last Friday except for the 91- and 182-day Treasury bills, which dropped by 13.8 bps and 5.1 bps, respectively, to yield 3.207% and 3.462%.

The yield on the one-year paper meanwhile went up by 0.6 bp to 3.705%.

At the belly, the rates of the two-, three-, four-, five-, and seven-year Treasury bonds (T-bond) climbed by 1.8 bps, 4.9 bps, 8.6 bps, 12.2 bps, and 13.5 bps, respectively, to 4.046%, 4.21%, 4.369%, 4.51%, and 4.688%.

The long end of the yield curve similarly rose, with the 10-, 20-, and 25-year notes increasing by 7.2 bps, 7.1 bps, and 10.5 bps, respectively, to 4.836%, 5.201%, and 5.201%.

For this week, all eyes are on the BSP’s Monetary Board’s policy meeting on Sept. 26 as the market anticipates a 25-bp cut.

BSP Governor Benjamin E. Diokno earlier said the central bank’s plan to cut rates again “won’t reach November.”

So far, the central bank has trimmed rates by a total of 50 bps this year — by 25 bps each last May 9 and Aug. 8 — to a range of 3.75% to 4.75%, partially dialing back the 175-bp cumulative hikes put in place last year to arrest multi-year high inflation.

“GS yields might move sideways, with a downward bias, as the BSP is expected cut policy rates by another 25 basis points this week,” the bond trader said.

“Likely softer US data on housing, durable goods, manufacturing, and services are also seen to drive yields lower, tempering the impact of likely upbeat US personal consumption expenditure inflation and positive developments on the US-China trade war,” the trader added.

For Ms. Dulay, she expects GS yield levels to remain range bound and to take its cue from Tuesday’s 20-year bond auction.

The Bureau of the Treasury will auction off on Tuesday reissued 20-year T-bonds worth P20 billion. The bonds have a remaining life of 19 years and four months and carry a coupon rate of 6.75%.

The government is set to borrow P230 billion from the domestic market this quarter through Treasury bills and T-bonds as it targets to raise P1.189 trillion this year from local and foreign sources to fund its budget deficit, which is expected to widen to as much as 3.2% of gross domestic product.

J.Lo closes Versace Milan show in that jungle dress

MILAN — Pop star and actress Jennifer Lopez strutted down the Milan catwalk on Friday, closing the Versace fashion show in a recreation of the plunging jungle-themed gown she wore to the Grammy Awards nearly 20 years ago.

The 50-year-old joined models including sisters Gigi and Bella Hadid in the Milan Fashion Week presentation, walking the runway after a screen showed a Google voice search for the dress producing photos of Ms. Lopez in the frock at the 2000 Grammys.

Ms. Lopez modeled a newer version of the green dress, which at the time made headlines for its revealing low-cut front and skirt slits. She was later joined by designer Donatella Versace on the catwalk.

“For the Spring/Summer 2020 Collection, Versace honors an iconic moment when fashion and culture became a catalyst for technological progress,” the brand said.

This time Ms. Lopez’s dress did not have sleeves but had more decorations and side slits.

In an April post on YouTube, Lopez said wearing the original dress was her “biggest fashion moment ever,” and that she had learned years later how so many people looking for it online helped inspire the creation of Google Images.

“So many people went searching for this,” she said.

The show marked the 20th anniversary of Versace’s jungle print, with models wearing tops, skirts, suits and dresses in its vivid green hues.

There were also sharply cut black dresses, jackets and coats, tie-dye designs and bursts of neon pink, green and orange for outerwear, frocks and shirts with voluminous sleeves.

BLUMARINE
Earlier, Italian designer Anna Molinari dedicated her latest Blumarine collection to kindness, a virtue that she said seemed “to belong to a time past.”

Ms. Molinari, known for her feminine and romantic looks, used pastel colors and bold pinks for floaty dresses and floral printed or embroidered tops, skirts, shorts and trousers.

She put roses, her favorite flower, on organza tops, chiffon dresses, hot pants and pencil skirts, and as shimmering sparkles on crystal embroidered evening gowns.

Short satin slip dresses were trimmed with lace. Ms. Molinari also put shimmering nets over some frocks.

“This show celebrates an attitude of spontaneous, fresh sense of elegance — I have been inspired by the calm poetry of nature and by the ravishing world of flowers,” she said in show notes.

Ms. Molinari also presented five silk embroidered sweaters each spelling out the words “Sweetie,” “Cutie,”, “Lovely,” “Smiley,” and “Kind” that she said would go on sale on the brand’s site and at Blumarine’s Milan store after the show.

The designer wore a beige top with “Thank You” emblazoned on the front when she greeted the audience at the end of the show.

ETRO, BOTTEGA VENETA
Italian label Etro went for a “Posh Pirates and Aristo Groupies” theme at its show, presenting floaty and embroidered dresses, caftans, ponchos, and tailored suits.

With influences from Isla Mujeres, Ibiza, Tangier and Goa, designs were adorned in Etro’s usual paisley motif, ikat and patchwork patterns and metallic fringes.

Designer Daniel Lee presented his second runway show for Italian luxury goods maker Bottega Veneta on Thursday evening, kicking off with a one-shouldered black dress, before presenting leather designs and loose halter-neck tops printed with pineapples and monkeys.

There were shirt, ribbed and sparkly cowl neck dresses, light anoraks, belted trench coats and jackets with large pockets in black, dark brown, orange, gold and different shades of blue. Men wore oversized jackets and shorts.

Bottega Veneta is known for its woven bags, and Lee used that technique for slip-on heel shoes. Bags were large and slung over the shoulder though some models carried small clutches. — Reuters

Service provider Vestas wins P134-M tax refund

THE Court of Tax Appeals (CTA) partially granted the petition of Vestas Services Philippines, Inc., allowing the amount of P134.3 million of its claims to be refunded.

In a decision dated Sept. 20, the court’s second division said the service providing firm was able to prove its refund claim for the amount of P134.3 million representing its unutilized excess input value-added tax (VAT) attributable to zero-rated sales for the second quarter of 2014.

“Finally, it was established that the input VAT of P134,298,376.32 was not carried-over nor applied against any output VAT in the succeeding quarters,” the decision read.

“In fine, petitioner has sufficiently proven its entitlement to a refund or issuance of TCC in the amount of P134,298,376.32 representing its unutilized excess input VAT for the second quarter of CY 2014 which is attributable to its zero-rated sales/receipts for the same period,” it added.

Vestas initially claimed the refund of P185 million while its input VAT return for the second quarter in 2014 is at P200.8 million.

Out of the P200.8 million, the court disallowed the P44.16 million as it was not properly substantiated by VAT invoices or official receipts, leaving the valid input VAT to P156.7 million.

The amount was trimmed to P134.3 million as it is the amount attributable to its valid zero-rated sales/receipts of P1.8 billion.

The corporation first claimed that its zero-rated sales is at P2.1 billion but some of the amount was disallowed as it does not represent actual revenues, made outside the period of claim and were not reported in VAT return, the court said.

The decision was penned by Associate Justice Cielito N. Mindaro-Grulla and was concurred in by associate justices Juanito C. Castañeda, Jr. and Jean Marie A. Bacorro-Villena. — Vann Marlo Villegas

All-new Mazda3 redefines premium

BERMAZ AUTO PHILIPPINES (BAP), the official distributor of Mazda vehicles in the country, unveils five variants of the much-anticipated all-new Mazda3. The Elite range of the 4-door sedan and 5-door Sportback variants of the Mazda3 will come with the highly fuel-efficient 1.5-liter Skyactiv-G engine while the Premium trims will feature the more powerful 2.0-liter engine along with additional safety and comfort features.

The all-new Mazda3 pioneers the new era of Mazda Premium by elevating the nameplate’s already exceptional driving experience together with even higher levels of design, craftsmanship, engineering and safety.

“We are proud to finally introduce the all-new Mazda3 to the Philippine market,” shares BAP President and CEO Steven Tan. “Mazda has raised the standards of quality, craftsmanship and safety to never-before experienced levels in this class. Through exquisite design, superior finish, refined quietness and engaging vehicle dynamics, owners of the all-new Mazda3 will surely experience class-above driving pleasure.” Mr. Tan adds, “This is a bold new step for Mazda as we deliver on our promise to give our loyal customers the true premium driving experience they deserve.” More than 19,000 Mazda3 units have been sold in the Philippines since its 2004 introduction into the country. This makes the Mazda3 the most successful Mazda model on record in the country.

The Mazda3 is a global strategic model that has the company from both a brand and business growth perspective. Since its initial worldwide launch in 2003, the model has sold more than 6 million units. As a core model in the Mazda lineup, it has always reflected the latest advances in Mazda’s vehicle engineering and manufacturing prowess while continuously raising awareness of the Mazda brand globally.

The Mazda3 is the first model by Mazda to feature the Evolved KODO design language — a more mature and elegant expression of life and vitality which Mazda first introduced in the RX-Vision concept car at the 2015 Tokyo Motor Show. The theme of development for the all-new Mazda3 was to make it “an object of universal desire.” Mazda designers and engineers sought to make a car that would evoke longing in any person. To achieve this end, a new definition of beauty that showcased the “less is more” Japanese minimalist aesthetic was adopted in the design of the Mazda3. This newfound philosophy was further echoed by the Vision Coupe, Mazda’s award-winning concept car unveiled in the 2017 Tokyo Motor Show. Without the usual character lines that defined traditional car designs, a cleaner more sophisticated presence was achieved. With the all-new Mazda3, these design cues take the shape of two distinct forms that personify works of art.

The all-new Mazda3 embodies two characters with widespread appeal. The first is the free spirit, one who is determined to follow his own convictions and not be bound by convention. This character is represented in the Mazda3 Sportback. To achieve a look that best embodies this personality, Mazda designers took an unprecedented approach to design that eliminates all character lines to achieve a form that is determined by the interplay of light, shadow and reflections of the surrounding environment.

The second character envisioned for the Mazda3 is that of a lady or gentleman who combines dignity with a strong individualistic streak. The traditional three-box sedan proportions were further heightened to produce a sleek, elegant, and graceful form.

To further strengthen the connection between car and driver, every aspect of the cockpit has been laid out in perfect symmetry. Consistent with the exterior design direction, the goal for the interiors of the Mazda3 was simplicity throughout based on the aesthetics of “less is more.” By removing visual noise, a cleaner cabin was realized without the loss of functionality.

For a sophisticated design feel, master craftsmen or Takumi, were tasked to achieve a new level of Mazda premium feel in the Mazda3. Quality can be felt through sensory inputs when looking at, touching and operating the various cabin appointments in this highly refined interior. Soft-to-the-touch surfaces abound with Mazda’s own grain designed to express the richness and warmth of genuine leather.

Driving an automobile requires paying constant attention to one’s surroundings, and Mazda wants to make driving less stressful and more natural for everyone. Employing lessons learned over the years in realizing Jinba Ittai — the state of oneness between car and driver — Mazda engineers sought to further understand how humans achieved balance in their everyday activities. By maximizing human abilities, the Mazda3 achieves a level of driving comfort and pleasure never before experienced in its class.

A 7-inch TFT LCD multimeter display has been adopted in the Mazda3 to show a simplified layout of vehicle status information. Even the Mazda Connect infotainment system has been redesigned from the ground up. A wider 8.8-inch display has been adopted with a simplified graphic user interface layout and refined operability. It is positioned higher and further away from the driver so comfort and convenience information such as media, maps and warning and alert details are a mere glance away.

Years of research and development by Mazda has led to a unique vehicle structure technology which is optimized throughout the entire car so that drivers can exercise their innate ability of self-balance. Skyactiv-Vehicle Architecture is the culmination of innovations in seat design along with body and chassis construction.

With cabin noise greatly reduced, Mazda also invested in enhancing the quality of music inside the cabin. The standard 8-speaker Mazda Harmonic Acoustics sound system concentrates on elevating the sound-listening experience at whatever volume the driver and passengers preferred while ensuring high-fidelity music.

The all-new Mazda3 will come in five distinct trims and prices:

• 1.5-liter Elite Sedan at P1,295,000

• 1.5-liter Elite Sportback at P1,320,000

• 2.0-liter Premium Sedan at P1,495,000

• 2.0-liter Premium Sportback at P1,510,000

• 2.0-liter Mazda3Speed Sportback P1,590,000

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