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October sees smaller hot money net outflow

FOREIGN PORTFOLIO investments continued to leave the Philippines in October, although the net outflow that month was far less than a year ago and in September, the Bangko Sentral ng Pilipinas (BSP) said on Friday.
In a statement, the central bank said that these investments — called hot money for the ease by which they enter and leave markets –resulted in $67.84-million net outflows in October, 87.96% less than the $563.42-million net outflows in the same month last year.
October marked the second consecutive month of net outflows.
October’s net outflow was also 84.59% less than September’s $440.3 million.
“The deficit may be attributed to investors’ reaction to the country’s September inflation data coupled with the continuing trade tensions between the US and China,” the BSP said.
Prices of widely used goods that month climbed by a nine-year-high 6.7% in September, a pace sustained in October.
Gross investment inflows declined 30.97% to $952.60 million in October from $1.38 billion in the same month in 2017. But they were up 28.16% from September’s $743.31 million.
Outflows totalled some $1.02 billion in October, 47.69% lower from $1.95 billion in October 2017 and 13.56% less than September’s $1.18 million.
“The US continued to be the main destination of outflows, receiving 77.7% of total remittances,” the BSP said.
Top hot money sources for the month were the United Kingdom, United States, Singapore, Norway, and Luxembourg, accounting for 82.4% of the total pie, the BSP said.
About 68.8% of investments that month went to securities listed on the stock exchange — particularly to holding firms, food, beverage and tobacco firms, banks, property companies, and telecommunication companies — logging net outflows of $301 million.
The remaining 31.2% went to government securities and peso time deposits, which posted net inflows of $233 million and less than $1 million, respectively.
There were also net outflows from other peso debt instruments of less than $1 million.
“Year-to-date transactions (1 Jan to 2 November 2018) yielded net inflows of $94 million compared to the $812-million net outflows for the same period last year (2 January to 3 November 2017), which is attributed to a large investment in a holding company registered this year,” the BSP said.
The central bank expects hot money to record a $900-million net outflow by yearend. — E. J. C. Tubayan

NEDA official downplays inflation impact of election spending

INFLATIONARY PRESSURES from election-related spending in 2019 will likely be muted, the National Economic and Development Authority (NEDA) said.
“It’s what we would call some sort of just a mid-term elections so we don’t see much by way of spending kasi hindi naman siya (because they are not) national elections,” NEDA Undersecretary Rosemarie G. Edillon said in an interview on the sidelines of a forum organized by the Center for Philippines Futuristics Studies and Management Inc. in Makati on Friday when asked how inflation would move amid election-related spending in 2019.
“Historically, not so much (inflationary impact). In fact, the uptick is also spread across three quarters,” she added.
Ms. Edillon said that campaigning spending does not have a broad-based impact on prices, explaining: “Kasi nakikita naman namin ‘yung uptick only in certain industries like paper, printing, and transport.”
The Bangko Sentral ng Pilipinas now expects inflation to settle at 3.5% in 2019 from an initial 4.3% forecast. Inflation averaged 5.1% in the 10 months to October against the central bank’s 2-4% full-year target range for 2018.
The government is banking on the impending enactment of a law that will shift the rice trading system — from one with import restrictions to one that liberalizes private sector importation — in order to ease food inflation pressures. That law is expected to slash retail prices of the staple by P7 per kilogram and shave 0.7 percentage point off headline inflation.
In the same forum, Roberto F. De Ocampo, chairman of the Center for Philippine Futuristics Studies and Management, Inc. and a former Finance secretary in the administration of Fidel V. Ramos, had a different view.
“The 2019 inflation would likely increase in anticipation of the local and national elections and the continuing increase in the global prices,” said the former Finance chief, noting that the polls would hep fuel economic growth as well.
The mid-term polls is set on May 13, 2019. The campaign period for senatorial candidates and party-list groups is scheduled from February 12 to May 11, next year, while the campaign period for district representatives, governors, councilors is scheduled on March 29 to May 11, 2019.
A 2010 NEDA study showed that election-related spending contributes an average 0.34 percentage points to gross domestic product (GDP) growth.
Moreover, Mr. De Ocampo forecasted a 6.6-6.8% economic growth for 2019, lower than the government’s 7-8% target, but still strong as it is boosted by public investment from the government’s infrastructure program, as well as robust domestic demand supported by overseas remittances.
“The Philippines will continue to be one of the strongest economies in Asia next year. The economy will gain from the government’s ‘Build, Build, Build’ infrastructure program with the rise of our infrastructure spending,” said Mr. De Ocampo.
“Remittances from overseas Filipinos will still be a major driver of the country’s domestic demand. This will be supported by the increase of investment inflows and our demographic sweet spot and dividend advantages in our labor sector.”
Mr. De Ocampo also flagged external uncertainties caused by the US-China trade war, global monetary policy tightening and uncertainty over the United Kingdom’s exit from the European Union.
“Right now the global situation is more confusing and unstable than the domestic one,” he said. — Elijah Joseph C. Tubayan

Sandiganbayan restores bail for Imelda Marcos

By Charmaine A. Tadalan, Reporter
THE Sandiganbayan’s fifth division on Friday allowed Ilocos Norte-2nd district Rep. Imelda R. Marcos to post bail anew pending resolution of her motion for leave.
“We will order her to post bonds in the same amount of the forfeited bonds,” Associate Justice Rafael R. Lagos said, noting Mrs. Marcos should remain within the premises until the bonds posted amounting to P150,000 have been approved.
The former First Lady was released from the custody of the Court around 11:30 a.m. upon approval of her bail.
The anti-graft Court was acting on the motion for leave of court to avail of post conviction remedies, which the camp of Mrs. Marcos filed on Nov. 12.
In the said motion, it was explained Mrs. Marcos failed to attend the promulgation on Nov. 9 “solely because she was indisposed.”
It was also noted that the accused suffers from the following medical condition: Diabetes Mellitus Type 2; Hypertension and atherosclerotic cardiovascular disease; Status mini strokes; Sensorial hearing loss; Chronic recurrent urinary tract infection; Chronic recurrent gastritis and multiple colon polyps and Recurrent respiratory tract infection.
Mrs. Marcos, however, also told the court the real reason for her absence was because she was unaware of the promulgation date.
“If I knew about it, I would have been here, even if I was sick, I would have been here,” Mrs. Marcos said, adding she learned about her conviction on the TV news.
On the matter of her attending the birthday party of her daughter Ilocos Norte Gov. Imee R. Marcos, she said she went there at her daughter’s pleading.
She explained further the notice of promulgation was sent to her residence, but was left in the office of her secretary who had been on leave for about a month.
“It turns out that an envelope from the Court was received by my cook and she placed the same in the room of my secretary, Shirley Torio. Unfortunately, Ms. Torio was not with me that week because she had to return to the province to attend the funeral of her aunt,” Mrs. Marcos said in her affidavit, submitted to the Court on Thursday afternoon.
Mrs. Marcos on Nov. 9 was convicted of seven counts of graft in connection with $200 million in public funds transferred to Swiss foundations during the rule of her husband, the late dictator Ferdinand E. Marcos
Opposition lawmakers slammed the Sandiganbayan order restoring bail for Mrs. Marcos.
“Very double standard! Very shameful of the high magistrates of the Sandiganbayan bowing down to the high and mighty Marcoses for the whole world to see. Very disappointing! As if the delay of more than two decades in deciding the case was not enough injustice,” Anakpawis Rep. Ariel B. Casilao said in a phone message to reporters.

Duterte in Papua New Guinea to attend APEC Summit

By Camille A. Aguinaldo, Reporter
PRESIDENT Rodrigo R. Duterte arrived in Papua New Guinea early Friday to attend the two-day Asia Pacific Economic Cooperation (APEC) Meeting there.
In a statement on Friday, presidential spokesperson Salvador S. Panelo said the APEC forum provides an opportunity for Mr. Duterte to express support for mechanisms that will benefit the country’s micro, small and medium enterprises (MSMEs) as well as bring their products and services overseas.
“The Palace expects President Rodrigo Roa Duterte to have a fruitful and productive visit to Papua New Guinea, the host of this year’s 19th Asia Pacific Economic Cooperation (APEC) Summit, as he joins 20 other leaders and representatives of member economies for the Economic Leaders’ Meeting,” he said.
According to Malacañang, the members of the President’s official delegation include Foreign Affairs Secretary Teodoro L. Locsin Jr., Finance Secretary Carlos G. Dominguez III, Agriculture Secretary Emmanuel F. Piñol, Trade Secretary Ramon M. Lopez, Presidential Spokesperson Salvador S. Panelo, and Communications Secretary Martin M. Andanar.
Mr. Duterte is also expected to attend the APEC Business Advisory Council (ABAC), APEC Leaders’ dialogue with Pacific Islands leaders on Saturday, and APEC Economic Leaders’ Meeting Gala Dinner.
On Sunday, President Duterte will join fellow leaders in an official APEC leaders’ photo. Then he will join the International Monetary Fund (IMF) Informal Dialogue with Leaders.
Mr. Panelo said the Department of Foreign Affairs (DFA) is coordinating with their its counterparts on possible bilateral meetings.
APEC member-economies include Australia, Brunei Darussalam, Canada, Chile, China, Hong Kong, Indonesia, Japan, South Korea, Malaysia, Mexico, New Zealand, Papua New Guinea, Peru, Philippines, Russia, Singapore, Taiwan, Thailand, United States, and Vietnam.

AFP: Martial Law helped improve Mindanao’s economy

By Vince Angelo C. Ferreras
THE Armed Forces of the Philippines (AFP) said the implementation of martial law in Mindanao has led to growth and development.
“Martial law has led to increased tourist and economic activity in Mindanao, especially in areas previously thought of as inaccessible to visitors from Luzon and Visayas. The improved security situation is so inviting that it is no longer unusual to find tourists exploring Bongao, Tawi-Tawi, Basilan, Davao, Zamboanga City, or island hopping in Jolo, Sulu,” said AFP Chief-of-Staff Carlito G. Galvez Jr. in a press conference on Friday, Nov. 10.
He added, “The development created more jobs and empowered residents to become active players in the peace and security of their communities.”
Mr. Galvez also said, “The economic performance of the ARMM also increased from 4.3 to 7.3 GDP. In particular, Zamboanga which ranked 102nd in 2017 in terms of economic standing jumped to the rank of 41 in 2018.”
The AFP chief further pointed out, “(The) disadvantage is we cannot sustain (the) gains na nakuha natin ngayon (that we have achieved), the pressure, the constriction, the containment.”
“Kasi (Because) we wanted a complete solution of the problem, the terrorism still lurks in the area….We want the victory (to) be completed and the result should be irreversible,” Mr. Galvez said.
Following the Marawi siege and standoff last year, President Rodrigo R. Duterte cited the terror threat in Mindanao as well as the New People’s Army as reasons for seeking the extension of martial law until December 31, 2018.
The AFP chief also said he will discuss with the Philippine National Police this month the recommendation that will help the President decide whether to extend martial law anew.
“Sa ngayon (For now)….magmi-meet pa kami ng PNP (we will meet with the PNP) on that matter. Sa ngayon kinukuha pa lang namin yung data (we are just gathering data for now)[like] what are the sentiments of the different stakeholders,” Mr. Galvez said.

7 CA justices in shortlist for SC associate justice

By Vann Marlo M. Villegas
SEVEN Court of Appeals justices are included in the shortlist for the associate justice post in the Supreme Court vacated by now-retired chief justice Teresita J. Leonardo-Castro, Justice Secretary and Judicial and Bar Council ex-officio member Menardo I. Guevarra said.
Garnering six votes, Court of Appeals (CA) justices Manuel M. Barrios, Japar B. Dimaampao, Ramon D.R. Garcia, Apolinario D. Bruselas, Jr., and Edgardo L. Delos Santos are shortlisted.
CA justices Rosmari D. Carandang and Amy C. Lazaro-Javier were also in the shortlist with five votes.
The five shortlisted nominees were not publicly interviewed last Nov. 18 as their previous public interviews were still valid.
The position was vacated following Ms. De Castro’s appointment as chief justice last Aug. 25.
Other nominees who did not make it to the shortlist are CA Justices Oscar V. Badelles and Stephen C. Cruz, Sandiganbayan Judge Alex D.L. Quiroz, lawyer Rita Linda V. Jimeno, and former Ateneo Law dean Cesar L. Villanueva.
Six applicants are also scheduled for a public interview on Dec. 5 for the position to be vacated by Associate Justice Noel G. Tijam who will retire on Jan. 5, 2019.
Scheduled for that morning are CA justices Ramon A. Cruz, Eduardo B. Peralta, Jr., and Ricardo R. Rosario, and for the afternoon, CA justice Ramon M. Bato, Jr. and Sandiganbayan justices Amparo M. Cabotaje-Tang and Efren N. de la Cruz.
Other candidates whose previous public interviews are still valid are Messrs. Barrios and Bruselas, Ms. Carandang, Messrs. Cruz, Delos Santos, Dimaampao, and Garcia, Mses. Jimeno, and Javier, Messrs. Quiroz and Villanueva, CA justice Mario V. Lopez, SC Court Administrator Jose Midas P. Marquez, and Tagum City judge Virginia D. Tehano-Ang.

Duterte, Abe meet, tackle peace and infrastructure initiatives

By Camille A. Aguinaldo, Reporter
PRESIDENT Rodrigo R. Duterte and Japanese Prime Minister Shinzo Abe held a bilateral meeting on Thursday on the sidelines of the 33rd Association of Southeast Asian Nations (ASEAN) Summit in Singapore and discussed cooperation between the two countries on peace and infrastructure.
In a statement issued on Thursday evening, Malacañang said the two leaders met after the closing ceremony of the ASEAN Summit at the Suntec Convention and Exhibition Center in Singapore.
“The Palace is confident that this ‘golden age’ of the Philippine-Japan relations, which is a result of the Duterte administration’s cautious, pragmatic, diplomatic yet independent foreign policy, would continue to yield great benefits for the country and improve the lives of our people,” said presidential spokesperson Salvador S. Panelo in a separate statement on Friday.
The Palace official said Japan reaffirmed its support for the peace process in Mindanao given the passage of the Bangsamoro Organic Law. Mr. Abe also reaffirmed Japan’s continued contribution to the government’s Build, Build, Build infrastructure program.
In a statement by its Ministry of Foreign Affairs, Japan said it is also preparing for the opening of a Consulate General in Davao City, Mr. Duterte’s hometown.
Japan’s funding in the North South Commuter railway in Metro Manila and the rehabilitation of the MRT-3 were also discussed, according to the Japanese Foreign Ministry.
Mr. Panelo said both leaders also discussed the South China Sea issue, “during which PRRD stressed the Philippines’ commitment to uphold the principles of freedom of navigation and overflight, freedom of commerce and other lawful activities, exercise of self-restraint, and the peaceful resolution of disputes.”

Golden Bria Q3 net profit P318.68 million, up 66.8%

THE Villar-controlled Golden Bria Holdings, Inc. posted a net profit of P318.68 million in the third quarter, up 66.8%, after the company reported strong real estate sales.
In its quarterly report to the stock exchange, the company reported revenue of P1.42 billion, up 65.1% from a year earlier. Real estate sales accounted for P1.38 billion, up 66.2%.
“Being present in every hometown is the goal Golden Bria aims to achieve,” said Golden Bria Chairman Manuel B. Villar, Jr. in a statement on Friday.
“As we work towards becoming the country’s largest mass market housing developer in Bria Homes, and the biggest integrated deathcare company in Golden Haven, we will continue to open more projects in new areas around the Philippines from our over 60 locations to date,” he added.
Golden Bria, which claims to be the country’s “fastest growing mass market housing developer and largest integrated deathcare company,” recorded a 66.1% rise in costs and expenses during the quarter to P983.55 million.
In the nine months to September, the company posted a net profit of P915.04 million, up 79.4% from a year earlier. It said it has sustained the upward trend since its listing in mid-2016.
It said the increase was “driven by significant increases in sales for both memorial lots and residential units,” with consolidated real estate sales growing by 59.1% to P3.93 billion.
The company said its deathcare business, Golden Haven, boosted its chapel services for the year, which grew more than three times to P27.2 million. — Victor V. Saulon
At the end of September, Golden Bria had assets of P18.15 billion, up 37.4% from a year earlier.
To date, the company estimates its combined holdings at more than 750 hectares of property all over the country, with more than 150 hectares set aside for deathcare projects and about 600 hectares allocated for mass market housing.
Golden Bria, through its subsidiary Bria Homes, has more than 40 residential developments, and through Golden Haven, has 26 memorial park projects nationwide. — Victor V. Saulon

Xiamen Air to launch Davao-Fujian flights in Dec.

DAVAO CITY — China’s Xiamen Airlines is launching direct flights between its base, Jinjiang City in Fujian Province, and Davao City in December following this week’s signing of a sister city agreement between the two destinations.
Davao City Tourism Operations Office (CTOO) Chief Generose D. Tecson said alongside the Sister City Agreement signed on Nov. 13 in Jinjiang was a Tourism Exchange Agreement.
The private sector agreement expresses support for the Davao-Jinjiang direct flights.
Xiamen Airlines, which is majority-owned by China Southern Airlines, has yet to determine the frequency of the service and schedule details.
The agreement “will bring the people of our two cities closer, strengthening the bilateral ties between our two nations even further,” Davao City Mayor Sara Z. Duterte said in a speech during the signing.
The City Information Office said the sister city agreement seeks to establish cooperation in tourism and culture, trade and commerce, health and wellness, and education, science and technology.
Ms. Tecson said the city is preparing for the anticipated increase in Chinese tourists by developing a bigger pool of tour guides who are fluent in the Chinese language.
“We only have two accredited Mandarin-speaking guides (right now),” she said.
Aside from the Tourism Exchange Agreement, businesses from both cities also signed several other memoranda of understanding, including one for the establishment of a Confucius Institute at the Ateneo de Davao University.
Representatives of the Jinjiang government, led by Executive Vice Mayor Li Zili, visited Davao City in February to present their interest in expanding ties.
Davao City also has a sister city agreement with another city, Nanning, in the Guangxi Zhuang Autonomous Region in southern China.
A Chinese consulate opened in Davao on Oct. 28. — Carmencita A. Carillo

Manila Water signs JV deal for Isabela water project

MANILA Water Co., Inc. said on Friday that its consortium with a wholly-owned subsidiary signed a joint venture agreement with the water district of Ilagan City, Isabela for a bulk water supply project, which includes water system expansion and septage management.
In a disclosure to the stock exchange, the Ayala-controlled water company said the consortium Filipinas Water Holdings, Corp. with its unit Manila Water Philippine Ventures, Inc. (MWPV) executed the deal with the City of Ilagan Water District (CIWD).
The joint venture agreement (JVA) calls for the incorporation of a joint venture company (JVC) that will implement the development, construction, operation and maintenance of the project in the city within Isabela province.
Under the agreement, the consortium and CIWD will own 90% and 10%, respectively, of the joint venture company’s outstanding capital stock.
“Upon completion of conditions precedents set out in the JVA, the JVC will then enter into a Bulk Water Supply and Purchase Agreement and a Septage Management Agreement with the CIWD for the implementation of the Project for 25 years from the commencement date as defined in the JVA,” Manila Water said.
The joint venture partner’s subscription will be P22.5 million in cash and the paid-up amount will be P5.625 million. The water district will subscribe for P2.5 million, with P625,000 in paid-up capital. In total, the amount subscribed for is P25 million, with P6.25 million in paid-up capital.
Separately, Manila Water disclosed on Friday that subsidiary MWPV had signed and executed a joint venture agreement with Tubig Pilipinas Group, Inc. to handle the setting up of water supply facilities in Malasiqui, Pangasinan.
The agreement calls for the two companies to incorporate a joint venture company that will establish, construct, operate, manage, repair and maintain the facilities in the municipality.
The project was awarded to the joint venture through a grant of franchise under a municipal ordinance. The companies will own 50% and 50%, respectively, of the JVC’s outstanding capital stock with an initial subscribed capital of P35 million and paid-up capital of P8.75 million.
Upon completion of conditions precedent set out in the deal, the joint venture will execute the project for 25 years from the start date as defined in the agreement.
On Friday, shares in Manila Water rose 0.78% to P25.70 during mid-day trading. — Victor V. Saulon

Pryce board approves P500-M share buyback

PRYCE Corp. said its board of directors approved on Friday a buy-back program of the company’s common shares for a worth of up to P500 million.
In a disclosure to the stock exchange, the Mindanao-focused importer and distributor of liquefied petroleum gas (LPG) said the buy-back program is for a term of 24 months starting on Nov. 20, 2018 and ending on Nov. 19, 2020.
Before the program, the capital structure of the company was at P2.098 billion authorized capital stock, all of which were common shares, and P2.0245 billion issued and outstanding. It does not hold treasury shares.
“The buy-back program shall be executed in the open market through the trading facility of the Philippine Stock Exchange,” it said. “Repurchased shares shall be booked as treasury shares.”
Pryce said the buy-back program will be implemented in an orderly manner and should not adversely affect the company’s and its subsidiaries’ prospective and existing projects.
Shares in the company were up 6.65% at P5.45 after it disclosed the program.
Aside from its LPG business, Pryce owns and operates memorial parks in Mindanao cities such as Cagayan de Oro, Iligan City, Ozamiz, Polanco near Dipolog City, Zamboanga City and Davao City.
Its scope includes smaller-sized memorial parks suited for the southern island’s secondary cities or major municipalities.
Pryce subsidiary Pryce Gases, Inc. is engaged in the importation and distribution of LPG under the “PryceGas” brand. It also produces and sells industrial gases.
Another unit. Pryce Pharmaceuticals, Inc. is a wholesaler and distributor of private branded multi-vitamins and some over-the-counter generic durgs. — Victor V. Saulon

A Brown Q3 net profit falls 5.8%

A BROWN Co., Inc. reported a 5.8% drop in third-quarter net profit to P82.85 million despite double-digit growth in its revenue for the period.
In a disclosure to the stock exchange, the Cagayan de Oro City-based real estate developer and dealer in agricultural products said revenue during the quarter hit P333.07 million, up 33.6% from a year earlier.
In a review of its quarterly operations, the company said it had sold 11 socialized, 20 economic and 78 high-end units or a total of 109 lots, and house and lot units.
A Brown also said crude palm oil sales were up 91% or P7.9 million during the quarter and 486% or P49.1 million at the end of September “due to the increase in quantity processed and sold.”
The company said sales by its water services business rose by 20%, while those of palm olein fell 77%. Also down were sales of kernel nuts and fertilizer, palm acid oil, palm stearin, and palm fatty acid distillate.
Costs and expenses during the period grew at around the same pace at P32.7% to P227.60 million from P171.56 million.
In the nine months to September, net profit fell 7.3% to P256.91 million.
Revenue during the nine months rose 34.4% to P913.33 million. This was widely outpaced by the 49.3% rise in cost and expenses to P631.51 million.
A Brown’s real estate development projects are in Cagayan de Oro City and Initao in Misamis Oriental; Cainta, Rizal; and Valencia City, Bukidnon; and Butuan City, Agusan del Norte.
The company also has ventures in oil palm nursery and seedlings distribution, palm oil milling, operation of hotels, real estate brokerage, power generation, and investment in gold mining assets.
On Friday, A Brown rose 2.67% to P0.77. — Victor V. Saulon

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