Ayala to re-issue up to P15B in preferred shares

September 13, 2019 | 7:34 pm

AYALA Corp. (AC) plans to re-issue up to P15 billion worth of preferred class B shares, it told the stock exchange Friday.

The listed conglomerate said in a disclosure that its board of directors has ratified the resolution of its Finance Committee for the re-issuance of the preferred class B shares. This consists of a base of P10 billion, with an oversubscription option of up to P5 billion.

“The terms of the re-issuance of the preferred class B shares will be disclosed in due course,” the company said.

The plan followed AC’s redemption of Class B Series 2 Preferred shares that will take effect on Nov. 5, or the fifth anniversary from the issuance of the securities.

The shares will be redeemed at P500 each, plus accrued and unpaid dividends at a rate of 5.575% per annum until the redemption date.

AC said the redemption will decrease the number of foreign shareholders of its preferred shares.

AC’s net income attributable to the parent surged 105% to P37.84 billion in the first half of 2019, mainly from the sale of its equity investments in the energy and education businesses. Gross revenues meanwhile went up two percent to P137.51 billion.

Shares in AC dropped 0.11% or P1 to close at P908 each at the stock exchange on Friday. — Arra B. Francia

BSP to move currency production facility to New Clark City

September 13, 2019 | 7:34 pm

TARLAC — The Bangko Sentral ng Pilipinas will be transferring its currency production facility to New Clark City (NCC) as part of efforts to boost production of notes and in line with its continuity plan for operations in case of natural disasters.

Under the central bank’s Memorandum of Understanding (MoU) with the Bases Conversion and Development Authority (BCDA), the new BSP Security Plant Complex (SPC) will be erected on a 29.22-hectare land area within the NCC—National Government Administrative Center (NGAC).

The said facility will be located near the access road that links NCC to the Subic-Clark-Tarlac Expressway (SCTEx). Currently, the BSP SPC is in East Avenue, Quezon City. The BSP said operations of the SPC will be transferred to the new facility once fully completed, with the Quezon City property to be closed or sold afterwards.

“The BSP follows a stringent set of criteria in selecting locations for its facilities. These standards — which encompass everything from lot configuration, site conditions, to infrastructural support — are intended to ensure that the BSP’s operation are optimally located,” BSP Governor Benjamin E. Diokno said during the MoU signing on Friday.

As per the MoU, offices of the BSP and its attached agencies to be built in NCC-NGAC will be consistent with the Phase 1 development of the NCC within the four-year timeframe from 2019 to 2022.

“I think all the paperworks should be done before the end of the year. So pwede na kami mag-umpisa ng construction first week of 2020. (So we can start the construction by the first week of 2020),” Mr. Diokno told reporters during the event. However, the BSP chief refused to disclose the budget for the facility as it is still in the works.

The BSP governor said that the new facility will boost the central bank’s ability to produce bank notes and to refrain from outsourcing.

“Right now ang capacity ‘nung plant sa Quezon City (the capacity of the plant in Quezon City) is P3 billion [bank notes] but the requirement is something like P5 billion. So ‘pag natapos itong bagong facility (so when this new facility is built), we won’t need to outsource requirements,” he explained.

ACCESSIBILITY
In total, the NGAC will house 60 hectares of government infrastructure. Meanwhile, 100 hectares will be for Filinvest. Some portions will also be developed into leisure facilities, according to BCDA President and CEO Vivencio B. Dizon.

He added that the master plan of the NCC includes the “necessary facilities needed not just to work here [there], but also to live,” with Mr. Dizon saying the most important of which are transportation and connectivity.

“These new roads are built to make this area more accessible. It’s important to know that distance-wise, we are only 15 kilometers away from Clark International Airport and the Clark Freeport Zone and we are only 10 kilometers away from the Subic Clark Expressway,” he said.

He addedthat the upcoming Manila-to-Clark railway will be beneficial to BSP employees who will be assigned in the new facility.

“Yung pinapagawa po ni [Transportation] Secretary [Arthur P.] Tugade…na Manila-to-Clark railway, magkakaroon po ng istasyon (The Manila to Clark railway will have a nearby station)…. It’s only about 300 meters from where the BSP facility will be,” Mr. Dizon continued.

Phase 1A also includes the sports complex which will be used for the Southeast Asian Games, a residence for government employees and a river park.

NCC’s first phase is the development of a 200-hectare NGAC which will house backup offices of government agencies including the BSP, among others, as a continuity plan in cases of disasters or natural calamities.

The development is one of the flagship initiatives of the Duterte administration’s “Build Build Build” program. — Luz Wendy T. Noble

PHL balance of payments position reverts to surplus in Q2

September 13, 2019 | 7:34 pm

THE country’s balance of payments (BoP) — which shows the Philippines’ economic transactions with the world for a certain time frame — reverted to a surplus in the second quarter, on the back of the narrowing of the current account deficit in the period, as well as continued net inflows in the financial account.

A report released by the Bangko Sentral ng Pilipinas (BSP) on Friday showed the country’s BoP position was at a $991-million surplus in the April-June period, a reversal of the $2-billion deficit booked in the same quarter last year.

“The surplus stemmed from the net inflows (i.e., net borrowing by residents from the rest of the world) in the financial account, albeit lower, mainly on account of the reversal of portfolio investments to net inflows and the sustained net inflows in the direct investment account,” the central bank said.

“The financial account continued to post net inflows on the back of the positive growth outlook as the country’s macroeconomic fundamentals remained stable. Meanwhile, the current account registered a lower deficit due to the narrowing of the trade-in-goods deficit combined with increased net receipts of trade-in-services, and in the primary and secondary income accounts during the quarter,” it added.

The report showed the country’s current account deficit narrowed 95.6% to $145 million in the second quarter versus the $3.284-billion shortfall logged a year ago.

The central bank said this was on the back of a lower trade deficit of $11.3 billion from $12.8 billion a year ago. Increased net receipts of trade-in-services ($3.3 billion from $2.2 billion), secondary income ($6.7 billion from $6.6 billion) and primary income ($1.2 billion from $712 million) also contributed to the improvement of the current account during the quarter.

Meanwhile, the capital account’s net receipts rose 15.4% to $18 million in the quarter from $16 million last year.

On the other hand, in the financial account, net borrowings of residents with the rest of the world dropped 86.6% to $225 million from $1.682 billion a year ago. This was due to the reversal of the other investment account to net outflows of $1.8 billion from net inflows of $48 million last year and the decline in net inflows of direct investments to$666 million from $2.7 billion. Meanwhile, portfolio investments reversed to net inflows of $1.3 billion in the quarter from a $1-billion net outflow in the same period last year.

For the first semester, the country’s BoP position stood at a surplus of $4.788 billion versus the $3.257-billion deficit booked in the comparable year-ago period.

The current account deficit in the first half narrowed to $1.741 billion from the previous year’s $3.756 billion, while the capital account registered net receipts of $33 million, higher than the $30 million booked last year.

Meanwhile, the financial account recorded higher net inflows of $5.719 billion in the first half from $2.536 billion the prior year.

Security Bank Corp. chief economist Robert Dan J. Roces said the first-semester BoP surplus shows the record-high reserves accumulated by the central bank.

“We continue to see positive fundamental inflows from higher net receipts. However these mask the negative on the current account which measures among others, trade-in-goods, which have been experiencing deficit,” he explained.

“On a positive note, our high capital account means we have enough forex (foreign exchange) reserves to stabilize the peso. Notwithstanding potential headwinds, as long as economic fundamentals stay robust and with the export sector potentially getting its much needed support, we are seeing a sustained surplus for the year,” Mr. Roces added. ““A pick-up in infrastructure spending for H2 will increase import demand for capital goods and raise the trade-in-goods deficit.”

The BSP expects the country’s BoP position to hit a surplus of $3.7 billion this year, a turnaround from the $2.306-billion deficit recorded in 2018. It sees the current account deficit at $10.1 billion by yearend, while the financial account is projected to end at a $5.2-billion net inflow.

Peso inches higher on bets of US-China deal

September 13, 2019 | 7:34 pm

THE PESO strengthened slightly on Friday on optimism that the US and China will have an interim trade deal by October.

The local unit closed at P51.91 against the greenback on Friday, climbing two centavos from its P51.93-to-a-dollar finish on Thursday.

On a week-on-week basis, the peso ended a tad weaker than its P51.905-to-a-dollar close on Sept. 6.

The peso opened at P51.88 against the dollar. It traded in a tight range, with its weakest point recorded at P51.911, while its intraday best was at P51.77 against the greenback.

Dollars traded on Friday recovered to $1.172 billion versus the $1.170 billion on Thursday.

“The peso appreciated after US President Donald Trump [said he] is considering to close an interim deal with China ahead of the scheduled October 2019 trade talks in Washington,” one trader said.

This was also echoed by Rizal Banking Commercial Corp. economist Michael L. Ricafort, who added that the trade deal with China “would delay or roll back some tariffs provided that China increases purchases of US agricultural products and protect US intellectual property rights.”

“Thus, this has supported the latest gains in the global financial markets including the peso.”

Reuters reported that deputy trade negotiators are due to meet in Washington in mid-September, with minister-level talks to follow in October. Exact dates for the meetings have not been released.

Chinese Vice Premier Liu He, US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are expected to meet in early October in the US capital, but key officials are tamping down expectations for a major accord. — Luz Wendy T. Noble with Reuters

PSEi firms up on easing US-China trade tensions

September 13, 2019 | 7:32 pm

LOCAL SHARES firmed up on Friday, taking cues from Wall Street which was boosted by easing trade tensions between the the United States and China.

The bellwether Philippine Stock Exchange index (PSEi) climbed 0.6% or 47.89 points to close the week at 7,992.32, while the broader all shares index likewise gained 0.48% or 23.18 points to 4,822.97.

“Shares closed higher as investors digested a slew of US-China trade news along with a large bond-buying program from Europe’s central bank,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a mobile phone message.

US President Donald J. Trump said Thursday he will be thinking about an interim deal with China, although he would still prefer a full agreement with the country. This follows Mr. Trump’s statement on Wednesday that he will delay the planned tariff increases on $250 billion worth of Chinese goods.

With this, the Dow Jones Industrial Average went up 0.17% or 45.41 points to 27,182.45. The S&P 500 index rose 0.29% or 8.64 points to 3,009.57, while the Nasdaq Composite surged 0.30% or 24.79 points to 8,194.47.

Investors also welcomed the European Central Bank’s (ECB) bond-buying program launched Thursday that seeks to stimulate the eurozone economy. It will start buying €20 billion worth of securities beginning Nov. 1.

At the same time, the ECB also cut the main deposit rate by 10 basis points, pushing the rates to -0.5%.

Philstocks Financial, Inc. likewise attributed the market’s increase to the ECB’s policy decision.

“The ECB’s monetary easing and optimism on US-China talks sent the local market higher by 47.89 points,” the brokerage said in a market note.

All sectoral indices ended in positive territory back home, led by services which jumped 1.1% or 17.78 points to 1,623.61.

Mining and oil rose 1.07% or 101.74 points to 9,591.46; property went up 0.87% or 35.37 points to 4,064.08; industrials climbed 0.82% or 90.22 points to 11,011.94; financials rallied 0.61% or 11.28 points to 1,832.62; while holding firms added 0.22% or 17.36 points to 7,918.59.

Turnover was thin at P4.53 billion after some 7.12 billion issues switched hands, lower than the previous session’s P6.73 billion.

Advancers overtook decliners, 111 to 69, while 63 names were unchanged.

Foreign investors turned net buyers at P140.55 million, against Thursday’s net outflow of P131.26 million. — Arra B. Francia

Meralco, Hitachi unveil PH’s first grid-scale energy storage system in the distribution network

September 13, 2019 | 10:02 am

In another example of its relentless pioneering spirit, the Manila Electric Company (Meralco) introduced the Philippines’ first grid-scale distribution-connected Battery Energy Storage System (BESS), a technology for storing electric charge through special batteries.

Commissioned in San Rafael, Bulacan, the utility’s two 1-megawatt (MW) lithium-based BESS units were launched September 6 in partnership with Japanese multinational conglomerate, Hitachi, through a Memorandum of Agreement.

BESSs are a sub-set of Energy Storage Systems (ESSs), the general term for systems that store energy to be consumed at a later time. Storing energy defers or reduces the need to buy capacity from the electricity marketplace.

BESS holds an advantage over other storage technologies due to its generally smaller footprint and a lack of restrictions regarding where these may be installed. Although versions are available, those of lithium-ion, a newer technology and the kind set up by Meralco, offer greater energy storage for their size and can be charged and discharged many times in their lifetime compared to most ESS technologies.

Lithium-ion batteries are currently the most cost-effective with the best energy density. They have been seen in a variety of consumer electronics applications such as in smartphones, tablets, laptops, digital cameras, and electric vehicles; with designs ranging from a few kilowatts with a few minutes of storage, up to multi-megawatt solutions with hours of storage that may be used at a utility substation or a wind or solar farm.

As a result, Bulacan’s lithium-ion BESS will be connected to the Meralco network spanning from Cruz-na-Daan (CND) Substation, where the 3.8 MW SPARC solar farm is also hooked up.

SPARC-generated power will be delivered and sold through the Meralco distribution system via the CND interconnection, where excess will presumably be stored at the San Rafael BESS.

Not only does the BESS project ensure a sustainable energy supply, the initiative aligns perfectly with Meralco’s affirmative action to prefer green in support of the country’s growth.

Revving up for a new generation in vehicle technology

September 13, 2019 | 9:05 am

It is an exciting time for the automotive industry. Great leaps in technology have allowed what was once science fiction to become reality, from electric, autonomous vehicles to artificial intelligence-driven digital services and platforms.

And while automobiles and vehicles have always been at the forefront of innovation, the potential for revolutionary developments in the industry has never been higher. Below, we take a look at the most promising trends and developments in the industry.

The electric-powered future

Switching to more sustainable sources of energy is among the world’s top priorities, as exhaust from automotives being one of the leading sources of the carbon emissions that are causing climate change.

Forbes, in an article describing the electric car rush in countries like China, wrote, “All across the global economy, titans of the fossil-fuel era are scrambling to adapt to an existential shift: the soaring economic viability of clean alternatives to dirty energy. Electricity and oil producers are struggling to ride — rather than be crushed by — a renewable energy wave.”

“Automakers, though, are at a particularly scary fork in the road. The rise of electric vehicles — machines with multiple small motors instead of one big engine; with batteries instead of a fuel tank; with unprecedentedly extensive software systems instead of a transmission — is poised to redefine car making.”

According to energy data firm Wood Mackenzie, combined sales of passenger EVs — including full-electric vehicles, which have no combustion engine, and “plug-in hybrid-electric” vehicles, which augment their battery system with a combustion engine — are on the rise, jumping 47% from the first half of 2018 to the first half of 2019, to 1.1 million. A combination of factors like declining cost and improving technology, notably for batteries; increasingly convenient electric-charging infrastructure, particularly in large cities; and hefty government support are driving that surge.

In places like India, ambitious government plans like the National Electric Mobility Mission Plan seek to put six to seven million electric vehicles on roads by 2020, in pursuit of an e-mobility target of 30% in the country by 2030.

The self-driving revolution

Some of the world’s biggest companies are leading the charge towards autonomous vehicles. Google, Uber, and Tesla are making headlines with self-driving vehicles outfitted with A.I.-enabled devices that allow them to safely navigate the roads without human intervention.

Technologies such as machine learning, cloud-based computing, and smart technologies show limitless capacities in improving vehicles into mobile platforms of the future. Such tech-enabled vehicles are equipped with sensors and cameras for recording vast amounts of data before, during, and after each trip, while radar systems use radio waves to detect the presence, speed, and distance of surrounding vehicles and objects.

Advanced local data processors can then perform calculations based on the collected data in real time, enabling precise, safe, and real-time on-the-road decisions. Afterwards, the onboard artificial intelligence can enact those decisions and ensure regular software and algorithm updates for continuously improved vehicle performance. In certain cases, some self-driving vehicles are even outfitted with smart technologies that interface with traffic lights, signs, and lane markers.

According to data from KPMG International, the Netherlands is leading the way as the country that is most ready to support driverless cars, followed by Singapore and the United States. China ranks 16^th.

A connected, smarter journey

With so many cars coming equipped with revolutionary technologies, manufacturers are finding new ways to connect people and their devices while on the road. The Internet of Things (IoT), one of the most promising fields in emerging technologies today, can create smarter transportation fleets that use GPS tracking to monitor road conditions, vehicle information, and driving habits in real-time. This works by allowing cars and smart-enabled devices to work in tandem with one another, keeping track of sensors connected to the road and traffic conditions, and even drivers’ health.

An estimate by the World Economic Forum predicts that by 2025, the number of IoT devices will exceed 40 billion, fueled by continued technological advances and the plummeting costs of computing, storage and connectivity.

The rise of 5G networks, which will allow faster transmission of larger amounts of data, can only further drive the development of more accurate and helpful devices.

Even for conventional cars without autonomous capabilities, 5G networks can improve route navigation, safety protocols, and can keep track of vehicle status. Vehicle to vehicle (V2V) communication will lead to fewer accidents on the road, as cars will now be able to share information about pedestrian crossings, infrastructure, and roadblocks to avoid. Sensor technology will do more than sensing what’s in its line of sight, as a fully-capable V2V network can allow a car to get a sense of not just its distance from other vehicles, but also what’s even further down the road, allowing for a safer, more informed journey. — Bjorn Biel M. Beltran

Advancements in safe driving

September 13, 2019 | 9:00 am

In choosing a car, features that help motorists drive safely are worth considering, especially as cars continue to innovate in each of its aspects and functions. Recently, local automotive buying and selling platform Philkotse.com listed down high-tech safety features of modern cars that are now considered as must-haves.

First among these is the forward collision mitigation or forward collision warning. Sensors in cars detect objects in front of the vehicle (e.g., walls, lampposts, pedestrians or other cars) and signal the car’s onboard computer to calculate the time remaining before a car hits an object.

“When the system determines that there is a danger of crash or collision, it will trigger an audible or visual signal to alert the driver,” Philkotse continued. “If the driver is not able to take appropriate measures immediately, the system will automatically apply the brakes to avoid or minimize the crash/collision’s severity.”

Adaptive headlights, another helpful tool especially in low-light conditions, “pivot in the same direction as the steering wheel, providing better illumination on the road.” Sensors are also used here, detecting the steering angle and eventually activating electric motors that turn the headlights.

Blind spot warning alerts drivers of cars approaching its blind spot from behind by signaling a flashing light or warning on the side mirror of the car. An upgraded version of this uses haptic feedback, which delivers a vibration through the seat or steering wheel and notifies of a potential hazard on the adjacent lane.

To keep cars in the proper lane, lane departure warning and lane-keeping assist technologies go hand-in-hand. “Lane departure warning uses a forward-facing camera to scan road markers, and notifies the driver with an audible or visual warning when it senses that the car starts to veer away from its current lane,” the article explained. However, if the driver does not heed such warning, “lane keeping assist feature takes over either by applying brakes to one side of the car to nudge it back into position or by using the steering wheel.”

For cars encountering one or more vehicles in their path, especially those in a parking lot, rear cross-traffic alert aids in preventing the car from hitting a vehicle that can hardly be seen by the driver. This is possible through sensors located at the car’s rear, which can detect such obstacles and then give an audible and visual signal.

In case of unexpected accidents to the point of incapacitating a car’s occupants, the automatic collision notification is a very accessible emergency tool. “When the system detects that the car has experienced a frontal crash (whether through airbag deployment or sudden deceleration), it will automatically contact an emergency operator who can speak to the driver or passenger,” Philkotse explained.

When before drivers rely on mirrors near their seats to keep their cars safe, rearview cameras now allow them to see the traffic or obstacles behind their cars. These cameras also display lines representing the car’s width (in some systems), night vision capability for low-light conditions, and a warning sound when the car gets too close to an object.

EO presses state offices to spend on time

September 13, 2019 | 12:33 am

MALACAÑANG has moved to ensure that government offices spend within the fiscal year what they are given under the national budget, by formally adopting the cash budgeting system (CBS) starting this year through Executive Order No. 91.

Signed by President Rodrigo R. Duterte on Sept. 9 and distributed to journalists on Thursday, EO 91 noted that “significant gaps” between what the annual budget provides and what state offices actually spend “translate to billions of pesos in delayed and foregone services, which should have been delivered to the general public.”

Hence, it added, the need to set “deadlines for obligation of funds and execution of projects during the fiscal year, in order to speed up the implementation of programs and to promptly deliver goods and services…”

“All authorized appropriations shall be available only until the end of each fiscal year,” the EO read, with procurement to be implemented, as well as goods and services corresponding to such obligations “delivered or rendered, inspected and accepted by the end of each fiscal year.”

Payments for such obligations will have a grace period of three months after the end of each fiscal year “unless another period has been determined by the Department of Budget and Management (DBM), upon consultation with relevant agencies.”

“Any unreleased appropriations and unobligated allotments at the end of the fiscal year, as well as unpaid obligations and undisbursed funds at the end of the extended payment period shall revert to the National Treasury and shall not thereafter be available for expenditure, except by subsequent legislative enactment,” the order read further.

Projects whose procurement requirements run for more than a year will require a multi-year contractual authority to be issued by the DBM.

The same EO formalizes an early procurement scheme by authorizing state offices “to undertake procurement activities, short of award” that “cover goods to be delivered, infrastructure projects to be implemented and/or consulting services to be rendered in the following fiscal year, pending approval of the corresponding general appropriations act.”

The government of President Rodrigo R. Duterte has moved since it assumed office in mid-2016 to spur expenditures after years of chronic underspending that has capped overall economic growth.

But a shift to CBS late last year for the 2019 national budget led to a tiff between the DBM and the House of Representatives, since the new scheme slightly reduced appropriations from 2018. Then Budget Secretary Benjamin E. Diokno, now central bank chief, had explained that the new system bases appropriations on state offices’ track record in spending. That, plus subsequent accusations by the House and the Senate that the other had illegally inserted funds in the 2019 budget resulted in late enactment of the spending plan.

The government operated on a reenacted 2018 budget from January to April 15, when Mr. Duterte signed this year’s national budget into law but vetoed P95.3 billion in funds that were not in sync with state priorities, slashing the total to P3.662 trillion.

Delayed enactment has been blamed for the muted 5.5% economic growth last semester, which compared to an already-reduced official 6-7% full-year target.

The DBM on Thursday said it had already released P3.345 trillion, or 91.4%, of this year’s national budget as of Aug. 31.

“It follows the normal pattern we have been seeing… where at least 85% of department budgets are considered released during the first day of budget effectivity,” DBM Undersecretary Laura B. Pascua said in an e-mail when sought for comment. “On the average, the NG (national government) obligates about 95% of the budget. We end allotment releases in November.”

Allotment releases to line departments totaled some P1.971 trillion, while releases from special purpose funds (SPFs) amounted to about P244.642 billion. SPFs are budget allocations for support of state firms, local governments, the Miscellaneous Personnel Benefits Fund and Contingent Fund, among others.

Allotment releases for automatic appropriations — like local governments’ annual share from national tax collections, interest payments for government debt and subsidies to cover duties and taxes on state transactions — totaled P1.069 trillion.

The DBM also released P29.072 billion for unprogrammed appropriations, consisting of authorized additional expenditures for priority programs and projects. — A. L. Balinbin and Beatrice M. Laforga

Automobile sales post seasonal dip in August

September 13, 2019 | 12:32 am

CAR SALES dropped in August for the first time in seven months, the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and the Truck Manufacturers Association (TMA) reported on Thursday, describing the reduction as seasonal.

Data the groups released showed that overall sales dropped 2.4% to 29,599 units in August from 30,313 vehicles a year ago, and seven percent from July’s 31,810 total.

It was the first year-on-year drop since January’s 15% fall.

But increases from February to July resulted in a 2.44% increase in industry sales to 235,544 vehicles as of August from 229,941 units in last year’s comparable eight months.

“Supply constraints and the run-out of outgoing models of some brands have hampered the industry’s rate of recovery in August,” CAMPI President Rommel R. Gutierrez said in a statement. “Together with that, the reality of seasonal trends in the industry continue to hold true, despite the boosted sales and marketing campaigns during the off-peak month of August.”

August last year saw sales drop 14.04%, as the industry reeled from higher automobile excise tax rates that kicked in at the start of 2018.

However, August 2017 saw sales grow 8.7% year-on-year.

August sales of commercial vehicles — which accounted for 70.33% of the industry total — dropped by 3.8% to 20,818 from 21,635 in the same month last year. Sales of Asian Utility Vehicles rose by 8.6% to 3,236 vehicles from 2,981 units, while those of light commercial vehicles dropped by five percent to 16,488 units from 17,354 vehicles.

In contrast, passenger vehicle sales grew by 1.2% to 8,781 units from 8,678 vehicles.

Toyota Motors Philippines Corp. continued to have the biggest vehicle market share at 44.2%, selling 13,083 units in August, 6.2% more than a year ago. It was followed by Mitsubishi Motors Philippines Corp. with 17.09% share though with sales dropping 7.3% to 5,057 units from 5,456 last year. Nissan Philippines, Inc. followed with 11.83% share, dropping by 22.2% to 3,501 from 4,500 units. Suzuki Philippines, Inc. sold 7.26% of the total, increasing its sales by 17% to 2,149 units from 1,836 a year ago. Ford Motor Company Philippines, Inc. came next, contributing 7.28% to the total with 1,515 units sold, 14.4% more than the 1,324 vehicles sold a year ago.

“Traditionally, August has been a challenging month for the industry. However, we expect a positive turnaround this September until the last quarter of the year as the industry introduces new car models…” Mr. Gutierrez said, saying the group’s of 410,000 unit sales goal “remains… highly achievable goal for the industry and we expect the road to recovery to continue until the end of the year.” — Jenina P. Ibañez

Philippines advised to further diversify its energy sources

September 13, 2019 | 12:31 am

By Victor V. Saulon
Sub-Editor

AUSTIN, TEXAS — Over-reliance on one type of energy or dependence on one country as an energy source is a threat to national security, an official of the US Department of State said here, as he pointed to alternative models of resource development that the Philippines can adopt.

“We think that it’s better for the country when you have the best choice of all of the different companies to look at — to look at the bids, to look at the offers — and then make the best choice for the country’s development and for the development of whatever resource you’re talking about,” Kent D. Logsdon, principal deputy secretary of the Bureau of Energy Resources (ENR), said in a briefing.

Mr. Logsdon was responding questions from visiting journalists from countries in Asia and Europe where the bureau hopes for greater engagement. ENR leads the State department’s efforts to forge its international energy policy to boost US and global energy security.

“We know there are lots of countries out there, several in particular, with state-owned enterprises who are very aggressive and who will come in with a checkbook,” he said.

He pointed to China and concerns from the United States about resource development models that offer terms to countries in the region, particularly those with territorial claims in the South China Sea, that center on joint exploration between a Chinese state-owned enterprise and a local company.

“We find that troubling,” Mr. Logsdon said.

He said the United States has been clear about its stand that the South China Sea is an international open waterway.

“US companies and other international companies should also be free to operate there. We continue to make that very clear, I think, in both word and deed. So we talked to China and we talked to countries in the region to say that,” he said.

For the United States, national security is threatened when its allies lack reliable access to diversified, affordable and reliable energy; foreign energy markets shut out US companies; market-based energy solutions are hindered by poor governance; competition for energy leads to conflict; or terrorists and rogue regimes exploit energy resources to fund violence and destabilizing activities.

ENR serves as the principal advisor of the Secretary of State on energy security, policy, operations and programs. As opposed to domestic concerns of the US Department of Energy, the bureau’s focus is more international.

Mr. Logsdon said the bureau works with governments in setting an enabling environment for companies to do business fairly.

“Sometimes, a state-owned enterprise might win a competition, but if it’s a fair and open competition, that’s what companies are looking for — that they were able to bid, and that they were able to get their bid considered in a fair way and the best company was chosen,” he said.

He said the US is promoting a private sector-led model of energy resource development where its companies, especially the smaller ones, can offer solutions, especially in renewable energy.

Asked about the enabling environment that US firms are looking for, he said these are the same as what other governments and businesses around the world would seek. In energy legislation, for instance, he said these the same as what US companies tell the government.

“But again it’s pretty basic — it’s transparent processes, they’re looking for what is the process if you have a dispute, how do you resolve that,” Mr. Logsdon said.

“They start from the beginning — in the very fairness of getting a contract, that if they put a bid down, it’s an open, transparent competition in order to win that. And then there’s the relationship with the government to figure out how they will share, whether it’s a production sharing agreements, whether it’s just again dispute resolution mechanism, what do you do when there’s a problem.”

Mr. Logsdon said US companies are keen to participate in Philippine projects, including petroleum exploration, if they see “the right kind of structure and enabling framework.”

“The US government can’t direct US companies to any place in the world,” he said.

“They have to see a resource that they think they can develop, and that they can actually be a profitable company there… that’s the bottom line.”

Filipinos dropping out of the work force could benefit the economy

September 13, 2019 | 12:30 am

LOW UNEMPLOYMENT in the Philippines may be masking the fact that more people are opting not to work — and preferring to stay in school for longer.

The jobless rate has been fairly steady around five percent for more than a year, down from 6.6% two years ago.

A closer look at the data shows more than 750,000 Filipinos aged 15 or above dropped out of the labor force last year. That means some 28 million people — about 40% of the working-age population — aren’t employed and aren’t looking for jobs.

“Most of the youth stayed out of the labor force,” Socioeconomic Planning Secretary Ernesto M. Pernia told reporters.

“Boys cited staying in school as their reason for not working.”

At first glance, that would seem like a major drag on growth.

But a better-educated workforce would be a significant boost down the line for a country that counts population size as a major driver of its economy.

Traditionally, young Filipino men have worked without pay on family farms or earn meager salaries for manual labor at construction sites, markets or ports.

The number of men aged 15-24 who were not in the labor force — and which would include students — increased by 1.25 million between 2010 and 2018, according to the statistics agency.

At the same time, the number of females joining the labor force climbed: About 1 million more young women actively looked for employment or had joined the workforce in 2018 compared to 2010.

Families may be keeping their sons in school longer as they benefit from a decade-old government cash-transfer program, as well as free tuition at technical schools and state colleges, said Emilio S. Neri, Jr., a senior economist at Bank of the Philippine Islands.

“All of those efforts led to more students gaining more access to tertiary and technical or vocational” education, he said.

In addition, high schools — which used to end at 10^th grade — added two extra years of studies several years ago.

That may have kept young people out of the workforce for longer, but wouldn’t have stopped some families from taking teens out of school and sending them to work if necessary.

Among Filipino men, 21% have undertaken college or other post-secondary education, compared to 25% of women, the latest data from the statistics agency show.

Most male students in tertiary education are studying information technology, while most women are in business administration and related fields.

There are signs that the programs are slowly translating to a better-educated labor force. “It’s to the country’s advantage to make the best of the increasing labor force to boost economic output,” Mr. Pernia said, adding that the government intends to invest more in educational programs.

Better education and training will surely deepen the available talent pool. But the key test will be whether the economy can create enough jobs outside service industries like tourism and call centers.

“The challenge is really to continue generating the opportunities for higher-skilled workers,” Mr. Neri said. — Bloomberg

1...10,46210,46310,464...14,215 Page 10,463 of 14,215