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Hefty hike on fuel prices this week

OIL COMPANIES will implement a hefty price increase for all petroleum products this week, with diesel registering the biggest hike at P1.20/L. It is diesel’s biggest price jump so far this year, matching the same rise during the second week of May. Gasoline and kerosene prices will increase by P0.95/L. All the companies that sent their advisories as of 5:00 p.m. on Monday scheduled the adjustment at 6:00 a.m. on Tuesday, Sept. 4. The price increase follows the movement of prices in the international market, from which local companies source their petroleum products. During the weekend, oil firms that sell liquefied petroleum gas (LPG) advised of a P1.95 per kilogram increase, or a P21.45 jump in the price of each 11-kilogram cylinder. AutoLPG also increased by P1.10/L on Saturday. — Victor V. Saulon

XiamenAir black box back in Manila; investigation still ongoing

THE READOUT of the flight data recorder (FDR) and the cockpit voice recorder (CVR) of XiamenAir flight MF8667, which were brought to Singapore last Aug. 23, has been returned to Manila last Friday, but the investigation on the incident that caused chaos last month at the Ninoy Aquino International Airport is still ongoing. “Under international and Philippine aviation rules, substantial content of the FDR and CVR readouts still cannot be disclosed until the final report,” the Civil Aviation Authority of the Philippines (CAAP) said in a statement yesterday. It added that the CAAP Aircraft Investigation and Inquiry Board (AIIB) has “confirmed that the black box data recording was of good quality.” The AIIB’s investigation is meant to identify safety breaches, while a separate probe by the CAAP-Flight Safety Investigation Committee aims to determine possible breaches against civil air regulations.

MCWD pursues water sources as PAGASA warns of looming El Niño

THE METROPOLITAN Cebu Water District (MCWD) has lined up its sourcing plans to plug the growing gap between supply and demand, especially with a likely El Niño occurrence by the end of the year. “We may not be able to close the gap between the supply and demand as fast as we wish to but we are heading towards that direction. Metro Cebu’s fast economic development is a blessing but the increase of the water requirements at an unprecedented speed is an ongoing challenge for the water district,” MCWD General Manager Jose B. Singson Jr. said in a statement. MCWD, the largest water supplier in Metro Cebu, currently serves only 42% of the water demand in four major cities and four municipalities, with some areas experiencing less than 24 hours of supply. The current demand of Metro Cebu’s over one million population is now at 400,000 cubic meters (cu. m.) per day while MCWD is producing only about 234,000 cu. m., sourced mostly from groundwater wells and bulk water supply from private suppliers. PAGASA-Cebu Officer-in-Charge Alfredo F. Quiblat, Jr. said there is now a higher possibility of an El Niño event within the year based on recent analysis. “It seems that climatologists are already sure that an El Niño event will happen this year… But we still don’t know as to the intensity of the El Niño, whether it will be weak, moderate or strong,” he told The FREEMAN over a phone interview. — The Freeman
>> See the full story on https://goo.gl/xjKnDZ

Military locks down Isulan after 2nd blast; police officials relieved

PHILIPPINE NATIONAL Police (PNP) Director General Oscar D. Albayalde has ordered the relief of Isulan town and Sultan Kudarat provincial police officials in the wake of another bombing Sunday night, the second in just five days.
“We are saddened by the casualties brought about by this cowardly act perpetrated by people hell bent on their nefarious goals without regard for the lives of civilians,” the PNP said in a statement.
Initial reports indicated that the improvised explosive device, which hit an internet cafe, killed and 15 others injured, but the death toll has so far risen to two with one of the critically-wounded dying at the hospital.
The Armed Forces of the Philippines (AFP), meanwhile, has locked down Isulan and ground forces have been directed to conduct relentless operations against groups believed to be behind the blasts.
Police and military officials have said members of the extremist Bangsamoro Islamic Freedom Fighters are behind the bombings.
The blast last Tuesday, which occurred just a few hundred meters away, left three dead and 34 others injured.
Malacañang on Monday condemned the latest incident and said President Rodrigo R. Duterte, who is currently on an official visit to Israel, “has been kept updated on all developments.”
“We strongly denounce the latest attack in Isulan, Sultan Kudarat. We are deeply saddened by the death of one innocent victim, per initial report, and pray for the swift recovery of those injured,” Presidential Spokesperson Harry L. Roque, Jr. said in a statement.
The Palace also asked the public to report anything that they find suspicious to the PNP and the AFP.
Isulan Mayor Marites K. Pallasigue, in a statement, announced the suspension of classes on all levels, both private and public schools.
She said there will be an emergency meeting with principals and school administrators regarding the matter.
Ms. Pallasigue also said the “investigators and the PNP” have already identified some “persons of interest.” — reports from Arjay L. Balinbin and Philstar

Better intelligence, not martial law extension, needed vs terror activities

SENATOR PANFILO M. Lacson, a former police director general, on Monday dismissed martial law extension as a solution to address the recent bombings in the country but called instead for improved military intelligence operations. He said he also hoped the bombings were not linked to the recent signing of the Bangsamoro Organic Law (BoL). “So I hope the explosions or bombings in Mindanao is not related to the BoL. Because of the passage of the BoL, I have said that this has become a vicious cycle that whenever you talk to the MNLF (Moro National Liberation Front), an armed group is being formed. Now, the government talked to the MILF (Moro Islamic Liberation Front), maybe there is another new armed group that the government did not talk to and it looks like it’s the BIFF (Bangsamoro Islamic Freedom Fighters),” he told reporters in a mix of Filipino and English. — Camille A. Aguinaldo

Nation at a Glance — (09/04/18)

News stories from across the nation. Visit www.bworldonline.com (section: The Nation) to read more national and regional news from the Philippines.

BSP can hold fire on rates even as inflation peaks

By Melissa Luz T. Lopez, Senior Reporter
THE Bangko Sentral ng Pilipinas (BSP) has sufficient leeway to hold fire on policy rates this month even with higher inflation in August, a bank analyst said.
Chidu Narayanan, Asia economist of Standard Chartered Bank, expects prices of widely-used goods to have surged to 6% last month, a fresh nine-year high following a 5.7% rise in July and the 2.6% logged in August 2017.
If realized, this would be the highest inflation reading since a 6.6% rise in March 2009. The 6% estimate is also slightly higher than a 5.9% forecast from the Department of Finance, the Bangko Sentral ng Pilipinas (BSP) and a BusinessWorld poll of 14 economists.
The Philippine Statistics Authority will release official inflation data tomorrow.
Mr. Narayanan said the fresh spike in prices comes on the back of higher rice and fish prices which account for 2.8 percentage points (ppt) of inflation, followed by housing and utility costs which add 1.3 ppt.
However, this should be the peak level for the year.
“We expect inflation to peak in August — we forecast a moderation in inflation in Q4 and 2019,” Mr. Narayanan said in an e-mail interview, adding that this will leave room for the BSP to keep policy settings steady.
“The central bank is likely to maintain its hawkish rhetoric at its September meeting, but not hike policy rates following its cumulative 100 bps of hikes at its past three meetings.”
Prices of widely-used goods and services have surged by an average of 4.5% as of end-July, well above the original 2-4% target. The central bank has abandoned this goal as latest estimates show a full-year inflation rate of 4.9%, with the focus now towards guiding price movements back to below 4% by 2019.
In response, the BSP raised interest rates by 50 basis points (bp) during the Aug. 9 meeting in a bid to rein in inflation expectations, which plays a huge role on actual price movements.
The bank analyst added that the central bank can stand pat on current benchmark rates — which range between 3.5 and 4.5% — until year’s end.
“With inflation likely to moderate in Q4, we see no further rate hikes from the central bank. Medium-term risks to inflation lie to the upside, in our view, on higher oil prices, a weaker currency or higher-than-expected infrastructure investment,” Mr. Narayanan added.
The BSP will reassess its policy stance on Sept. 27, its sixth review this year.
BSP Governor Nestor A. Espenilla, Jr. said the bank has “kept the door open” for future rate adjustments in a bid to ease price pressures, with the view that the economy can still absorb further tightening moves while keeping growth momentum intact.
In an interview with Fitch Ratings, Finance Secretary Carlos G. Dominguez III said that current interest rates are “not yet growth-threatening” despite the three successive hikes introduced by the BSP.
Meanwhile, Nomura analysts said rising inflation still merits a 50bp tightening of rates between September and December to douse price pressures. This comes at a time of sustained rapid credit growth, as bank lending accelerated to 18.7% in July, up from the 17.7% pace in June when accounting for reverse repurchase agreements.
“By sector, the acceleration was led by real estate & construction and manufacturing, which should continue to be viewed by BSP as lending into productive sectors,” economists Euben Paracuelles and Charnon Boonnuch said in a report on Monday.
Meanwhile, 2018 economic growth is expected to come in at 6.5%, suggesting 6.8% growth in the second half. This is below the government’s 7-8% growth target.

NFA says hands tied on rice imports, domestic procurement funding

THE National Food Authority (NFA) said it was not responsible for the rice supply crisis because it was not allocated sufficient funds to increase domestic procurement, and added that its advice was not heeded on the timing of imports.
“All of these present problems — thin buffer stocks, the wrong timing of import arrivals leading to delays in discharging and infestation on board the vessels, the high price of commercial rice in view of low government stocks — are the result of the rejection of NFA’s proposals since 2017 either to increase its palay procurement price for the agency to procure more locally, or to import at the proper time to prevent a depletion of stocks and make the agency effective and efficient in stabilizing the market,” the NFA management committee said in a statement on Monday.
The NFA said earlier that it received P5.1-billion worth of government subsidies from the Department of Budget and Management based on a Notice of Cash Allocation issued on Feb. 24, 2017. Of the total, the Bureau of Treasury (BTr) automatically deducted 10% or P510 million as payment for the previous years’ guarantee fee while P2.5-billion was set aside for its annual contribution to service the P8-billion worth of 10-year Treasury Bonds issued in February 2008.
The agency said that it received net proceeds of only P2.09-billion out of the total subsidy.
In a committee hearing at the House of Representatives on Monday, NFA Administrator Jason L.Y. Aquino said that “the P2.09-billion was used to pay for loans.”
The NFA said it increased the level of supply for the Zamboanga region to 4,000 from 2,000 bags per day, or about 80% of the region’s daily requirement of 5,340 bags. NFA rice is priced at P27 per kilo.
Meanwhile, more than 4,000 NFA employees wore red to protest against lawmakers’ proposals to abolish the agency, including proposals by Senators Cynthia A. Villar and Sherwin T. Gatchalian.
“The problem of rising rice prices and low supply is not the NFA’s fault, but the result of shortsighted decisions and wrong assumptions by people who work in the boardrooms unaware of what is happening in the rural areas, island provinces, highly populated urban areas and remote places across the country,” the NFA employees said in a statement. — Reicelene Joy N. Ignacio

Lacson threatens to remove right-of-way funds from 2019 DPWH budget

SENATOR Panfilo M. Lacson on Monday said the Department of Public Works and Highways (DPWH) cannot proceed with projects without settling right-of-way issues, as required by law.
At a DPWH budget hearing in the Senate Mr. Lacson said Republic Act 10752 or the Right of Way Act requires prior acquisition of right of way, and that some construction has proceeded in parallel with unsettled right of way, leading to delays of some public works projects.
“We’re not complying with the provisions of (RA) 10752 because it’s clear in the Right of Way Act. The DPWH shall ensure that all RoW expenses are settled before commencement of projects. So we’re not complying with the law,” he said.
Mr. Lacson then cited the suspended P466.8 million bypass diversion road project in Sariaya, Quezon, where right of way has not yet been secured.
“These are owners with titles to their land but up to now they have not yet been paid, and the project has been suspended since March 2016,” he said.
In an interview with reporters, Mr. Lacson said he may seek the removal once again of right-of-way appropriations to the DPWH under the proposed 2019 budget if the agency has not addressed the issues. The senator last year proposed a P50 billion reduction in the 2018 DPWH budget over right-of-way issues.
Under its proposed 2019 budget, the DPWH has allocated around P16 billion for right-of-way payments covering completed and future projects.
If the right of way remains unsettled, “we will have it deleted,” Mr. Lacson said.
DPWH Secretary Mark A. Villar said: “These things are not necessarily anticipated at the time of planning. During the course of the implementation of these projects there are issues that arise that we don’t anticipate but nevertheless those were the causes for delays.” — Camille A. Aguinaldo

Contract to build Iloilo dam project signed with South Korean company

By Victor V. Saulon, Sub-Editor
THE National Irrigation Administration (NIA) on Monday signed a contract with a South Korean builder for the construction of a dam in Iloilo province worth P11.212 billion.
In ceremonies at NIA’s headquarters, the agency through its Administrator Ricardo R. Visaya formally closed the deal with representatives from Daewoo Engineering and Construction Co., Ltd.
The Jalaur River multipurpose project will include a 109-meter high dam, a 38.5-meter afterbay dam, a 10-meter catch dam, and an 80.74-kilometer canal. It is funded by the South Korean government through the Export-Import Bank of Korea.
Pilipina P. Bermudez, a manager with NIA’s public affairs information staff, in an interview said next to the Jalaur project, 10 other “flagship” infrastructure projects are undergoing feasibility studies, six of which already have an estimated cost.
“These will be funded by China,” she said, referring to official development assistance (ODA) from the Chinese government.
“The terms are light,” she added, without disclosing specific numbers.
Of the six projects worth nearly P55 billion, two are on the agency’s priority list: the second stage of the Ilocos Norte irrigation project valued at P22.36 billion, using a valuation from two years ago; and the Panay River basin integrated development project in Iloilo and Capiz worth P19.357 billion.
Ms. Bermudez said she expects the two projects to obtain funding from China when President Xi Jinping visits the Philippines in November.
The four other projects are the Bohol northeast basin multipurpose dam which carries an indicative cost of P4.134 billion; Asbang small reservoir irrigation project in Davao del Sur at P1.355 billion; Tumauini River multipurpose project in Isabela at P4.121 billion; and Gregorio del Pilar impounding project in Ilocos Sur at P3.452 billion.
During the Jalaur contract signing, NIA officials noted that the project was mandated under Republic Act 2651, which was enacted by Congress in 1960.
Due to insufficient funds, the project was implemented in two stages. The first stage is the rehabilitation of existing irrigation systems covering an area of 22,340 hectares. It was completed in 1983.
The second stage is the construction of the high dam, hydropower electric plant, domestic water supply facilities, and watershed management systems. The second phase has been stalled since 1988 for unknown reasons, the agency said.
In a statement issued during the signing, NIA said the construction of big and small-ticket irrigation projects is in line with President Rodrigo R. Duterte’s “Build, Build, Build” under his 10-point socioeconomic agenda to reduce poverty from 21.6% in 2015 to 13-15% in 2022.
NIA said when completed, the Jalaur project’s second stage will be the biggest dam outside Luzon.
The dam is expected to deliver year-round irrigation to 9,500 hectares of new irrigable land and rehabilitate 22,340 hectares served by five existing irrigation systems. These systems straddle 23 municipalities and two cities in Iloilo province, benefitting 24,000 farmers and their families.
The project will also provide other “incidental benefits,” such as flood mitigation, environmental and watershed management, promotion of eco-tourism and fish culture. A 6.6-megawatt hydroelectric power and water supply for domestic and industrial use will be implemented later, NIA said.
The agency is mandated to provide reliable and sustainable irrigation services to farmers through the construction of irrigation systems and the rehabilitation of existing ones.

NAIA-QC point-to-point bus service launches; one-way fare set at P100

TRANSPORTATION service provider UBE Express and Araneta Center, Inc. said a new point-to-point (P2P) bus service from Cubao, Quezon City to the Ninoy Aquino International Airport (NAIA) will start operating today, Tuesday.
The 33-seater buses will travel 24 hours a day to and from the Araneta Center Bus Station and NAIA Terminals 1 to 4. The one-way fare is P100.
UBE Express Garrie A. David told reporters on the sidelines of the launching event the Cubao-NAIA route is the first of four routes it plans to open in September.
“We have three existing (routes from) Intramuros, MoA (SM Mall of Asia) then Makati. And the new routes we have are Araneta Center, Cubao; Robinsons Galleria in Ortigas; Nuvali in Sta. Rosa; and also Alabang. We’ll launch services one by one within the month,” he said.
The company currently has a fleet of 56 buses and expects the delivery of 79 more on order before the end of the year. Mr. David said each bus is air-conditioned, is equipped to serve persons with disabilities, and offers Wi-Fi connectivity and CCTV security.
Mr. David said four buses will be rolled out per route with departures set hourly. If demand increases, the company has the option to deploy more buses or shorten the interval between trips.
“We will always start with four. We take into consideration the demand. Once we have enough riders we’ll add more buses,” he said.
Mr. David estimates the comparable taxi fare between Cubao and the airport at P900.
Land Transportation Franchising and Regulatory Board (LTFRB) Board Member Aileen Lourdes A. Lizada told BusinessWorld she hopes the new bus service will also reduce the volume of cars on the road.
“If you are able to convince all of those going to NAIA or working in NAIA to leave their cars behind, that means reduced traffic,” she said.
Mr. David said the company is also keeping an eye out for other destinations it can serve via EDSA.
“We want to offer an alternative. If we offer (a more advanced bus system), then we can make the others irrelevant. That’s what we’re trying to do right now,” he said, noting the process by which ride-sharing services put pressure on traditional taxi companies. — Denise A. Valdez

House bill seeks to suspend fuel excise when inflation spikes

OPPOSITION MEMBERS of the House of Representatives have filed a bill seeking to suspend the excise tax on kerosene and diesel contained in the provisions of the Tax Reform for Acceleration and Inclusion (TRAIN) law.
House Bill 8171 calls for the excise tax on kerosene and diesel to revert to zero from P4.00 per liter.
Rep. Romero S. Quimbo filed the bill saying that rising inflation has placed an undue burden on low-income households.
“We recorded inflation of 5.7% in July, with August inflation expected to be at around the same level. Clearly steps have to be taken to bring relief to our people and shield them from future spikes in inflation,” he said.
The bill also calls for the automatic suspension of excise taxes on fuel when the quarterly assessed actual inflation rate exceeds the quarterly inflation target of the Development Budget Coordination Committee (DBCC) and the Bangko Sentral ng Pilipinas (BSP).
The relevant clause also reads: “in the event that the average inflation rate for succeeding quarters falls below the quarterly inflation target the Department of Finance (DoF) may lift the suspension of the excise tax on fuel.”
The government sets its inflation target on an annual basis.
House Bill 8171 is the counterpart of the “Bawas Presyo” bill, which was introduced in the Senate by Senator Paolo Benigno A. Aquino IV.
Senate Bill 1798 also calls for the automatic suspension of the excise taxes on fuel when the average inflation rate for a three-month period exceeds the annual inflation target range.
Also on Monday, Vice President Maria Leonor G. Robredo called for a change in leadership in the National Food Authority (NFA) amid increasing prices of rice.
“We have been seeking the resignation of the administrator since March,” Ms. Robredo told reporters in a press conference.
“We need a trustworthy official in that post,” Ms. Robredo added.
The Vice President also proposed to suspend excise taxes on fuel as well as to review the unconditional cash transfer program to determine whether there is a need to increase the P200 monthly allocation. — Charmaine A. Tadalan

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