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Rebellion case vs Trillanes resumes hearings

THE TRIAL for the rebellion case of Senator Antonio F. Trillanes IV in connection with the 2007 Manila Peninsula siege resumed Monday after the case was dismissed in 2011 following the grant of the senator’s amnesty application. During the hearing, the prosecution presented to the Makati Regional Trial Court (RTC) Branch 150 its witness, Assistant State Prosecutor Mary Jane W. Sytat, who discussed what she witnessed during the hearing of the coup d’etat case of Mr. Trillanes at Makati RTC Branch 148 on Nov. 29, 2007, the same day when the Manila Peninsula Siege was staged. Mr. Trillanes’ legal counsel, Reynaldo B. Robles, told reporters that he tried to object to the presentation of Ms. Sytat as she was not included in the list of witnesses. Mr. Robles was allowed by the court to cross-examine the testimony of Ms. Sytat on the next hearing scheduled July 22 at 2 p.m. Mr. Trillanes was charged with rebellion in 2007, but the court dismissed the case after he was granted amnesty by former President Benigno C. Aquino III in 2011. However, President Rodrigo R. Duterte issued in September last year Proclamation No. 572, which revoked his amnesty. — Vann Marlo M. Villegas

Lawyer asks SC to probe IBP officers involved in Advincula presscon

A LAWYER has asked the Supreme Court (SC) to investigate and hold accountable the Integrated Bar of the Philippines (IBP) officers who were involved in allowing Peter Joemel Advincula, self-confessed “Bikoy,” to hold a press conference at the organization’s office last May 6.

In a three-page letter addressed to Chief Justice Lucas P. Bersamin, lawyer Ferdinand S. Topacio said allowing “Bikoy” to be presented in the IBP created an impression that the organization advocates the man’s claims.

“During the said press conference, the IBP logo can be seen at the background, creating the impression that the entire IBP is advocating Advincula’s assertions, which, in reality, cannot be actually said for all its members,” Mr. Topacio said in the letter.

“Much damage has been done to the IBP, as well as to the legal profession in general, hence, the officers responsible for this reprehensible event should be investigated and held accountable,” he said.

Mr. Topacio added that the act of allowing Mr. Advincula’s press conference by IBP National President Abdiel Dan S. Fajardo and chairman Domingo Egon Cayosa is not in line with the objectives and purpose of the IBP.

Mr. Topacio also said despite the statement of IBP that it did not have knowledge that Mr. Advincula will hold a press conference, it is still “difficult to believe” the disclaimer since the function room where the briefing was held appeared to have been set up.

Mr. Advincula on May 6 surfaced and claimed that he is “Bikoy,” the personality featured in a series of videos that tagged members of the First Family to illegal drug activities. He asked the IBP for legal assistance to file charges against members of an alleged drug syndicate that he claims he belonged, and which also included Presidential son and representative-elect Paolo Z. Duterte, senator-elect Christopher “Bong” T. Go, and son-in-law Manases Carpio. Mr. Advincula surrendered to authorities on May 22 over estafa charges and held a press conference at the Philippine National Police on May 23, where he tagged the opposition Liberal Party as behind the videos.

TRILLANES
Meanwhile, Senator Antonio F. Trillanes IV on Monday admitted previously meeting Mr. Advincula, but denied anew his involvement in the video and an alleged ouster plot against President Rodrigo R. Duterte.

“First and foremost, I vehemently deny Bikoy’s allegation that I am part of any ouster plot against the Duterte regime,” Mr. Trillanes said in his privilege speech, Monday.

He recalled a meeting in August 2018, during which Mr. Advincula sought protection due to death threats made by a certain drug syndicate.

“Unang inilapit sa’kin itong si Bikoy ng mga pari nu’ng August last year. Ayon sa kanila, ito raw si Bikoy ay humingi sa kanila ng sanctuary dahil s’ya raw ay papatayin ng mga taga sindikato na involved sa illegal drugs (Bikoy was first sent to my office by priests in August last year. According to them, Bikoy is seeking sanctuary due to death threats of drug syndicates),” he said.

He, however, dismissed the meeting after finding inconsistencies in the statements of Mr. Advincula.

Mr. Advincula previously said he met the senator through a certain Fr. Albert Alejo.

“Sometime in February, binalikan ako ng mga pari at binigyan ako ng mga dokumentong naglalaman diumano ng mga detalye ng mga bank accounts ng mga lider ng sindikato. Ayon sa kanila, ang mga ito ay galing sa mga kasamahan ni Bikoy na mga miyembro ng sindikato (Sometime in February, the priests returned to me with the supposed bank account details of leaders of the syndicate, which according to them came from Bikoy’s fellow members in the syndicate),” Mr. Trillanes said.

The senator said he asked “media outfits, investigative journalists” and other “entities both foreign and local” to validate these documents.

“They said that the validation process might take a while but if the account details are accurate, the money trail could be traced. So, as far as those documents are concerned, maaaring totoo pa rin ang existence ng sindikatong ito, depende sa kalalabasan ng validation process later on (these could still be proven real, depending on the result of the validation process later on,” he said. — Vann Marlo M. Villegas and Charmaine A. Tadalan

Nation at a Glance — (05/28/19)

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

Nation at a Glance — (05/28/19)

Grab shares the love in 7th bday with over P7M worth of promos, discounts, rewards

Grab, Southeast Asia’s leading super app, has prepared a two-week celebration for its seventh birthday, marked by its biggest promotion in the country to date, strengthened partnerships, and the introduction of new services that will bring greater convenience to Filipino consumers.

From May 24 to June 6, Grab will delight its users with exciting promotions, deals, and gifts to show its gratitude to consumers who have helped Grab to be the preferred digital platform across different verticals.

More than P7 million worth of treats are up for grabs in the next two weeks, with the first week focused on Grab services, and the second week giving premium to Grab’s partners.

Promos range from P77 discounts for GrabCar, P777 cashback for GrabPay, P7 Grab bundles, and more! It will also hold a raffle for its 7 Grab Anniversary Gifts, wherein seven lucky winners per day for seven days will receive gift certificates worth up to P10,000 from Grab’s partners.

But the biggest among its many promotions for its seventh birthday is the awarding of seven winners with 1 million GrabRewards Points each. Grab is also giving away 50,000 GrabRewards Points as consolation prizes to seven Grab users.

To qualify, Grab users have to register to the raffle promo with their name, mobile number, and complete home address. They simply have to use any Grab service with eligible Grab transactions from May 24 to June 4.

Eligible Grab transactions include the following:

  • GrabCar, GrabTaxi, Grab, Grab Premium Rides (minimum fare value of P150)
  • GrabFood bookings (minimum delivery value of P300)
  • GrabExpress Deliveries
  • GrabRewards redemption (non-ride rewards only)

All users who have successfully completed at least one transaction of any of these Grab services during the promo period entitles the user one electronic raffle entry. Users can earn additional raffle entries for every additional transaction made with Grab.

Winners will be randomly picked via an electronic raffle on June 5 and will be awarded their winning prizes on June 6 during the Grab Anniversary Night.

“Sharing the love has always been at the core of Grab, and as we celebrate our seventh year in business, we want to give back to Filipino consumers who helped us reach where we are right now — the leading everyday super app in the Philippines and the greater Southeast Asia,” Grab Philippines President Brian Cu said

IT-BPM sector grows, short of program

THE INFORMATION TECHNOLOGY and business process management (IT-BPM) sector, the country’s chief dollar earner aside from overseas Filipino worker remittances and also a key driver of property development, saw “signs of recovery last year” even as job growth fell short of target, the IT & Business Process Outsourcing Association of the Philippines (IBPAP) said in a statement last weekend.

The group said direct employment “grew by 5.1%” to “1.23 million employees” last year.

IBPAP did not give revenue data. The government estimates that the industry’s revenues grew by about 12.3% in 2017, year-on-year.

“While we saw signs of recovery in 2018, this was slower than the eight percent annual growth projected in our Roadmap 2022,” IBPAP said in its press release.

In that road map, the group targets to achieve by 2022 — when President Rodrigo R. Duterte ends his six-year term — $40 billion in revenues (from about $22.5 billion in 2017), 1.8 million direct jobs, 500 jobs outside Metro Manila, 7.6 million direct and indirect employment and a 15% global IT-BPM market share.

“Although a missed opportunity to generate more jobs overall, there was strong performance by new locators, which offered a wider range of higher-end services, e.g. from customer service to e-commerce, supply chain management, IT infrastructure support and analytics,” the IBPAP added.

The group cited “strengthened partnerships” with the Department of Education, the Commission on Higher Education, the Department of Labor and Employment and the Technical Education and Skills Development Authority in order to address “the need for a solid talent upskilling and reskilling… to ensure that we are equipped with the right skills needed and for promoting the health and safety of our talent.”

At the same time, the group’s members and locators in economic zones in the country face prospects of a changing fiscal incentives regime as the Finance department moves to plug billion of pesos in foregone revenues from what it says are redundant tax perks.

That tax reform was designed to be approved in tandem with a proposal to slash the corporate income tax (CIT) rate to 20% by 2029 from 30% currently in order to put it at par with those across Southeast Asia, but lawmakers have proven hesitant to cut tax incentives even as they favor the CIT cut. — Janina C. Lim

Senate cuts projected take from tobacco tax

By Charmaine A. Tadalan
Reporter

THE MEASURE imposing a higher excise tax on tobacco products, as proposed by the Senate, is expected to generate P15 billion in revenues next year, the Department of Finance (DoF) said over the weekend.

The Senate Committee on Way and Means proposed to increase rates to P45 per pack of cigarettes in January 2020 from P37.50 currently, which will generate “P15B [illion] in 2020,” Finance Assistant Secretary Antonio Joselito G. Lambino II said in a mobile phone message on Friday.

This is lower than the P60 per pack rate proposed under Senate Bill No. 1599, backed by both the DoF and the Department of Health (DoH), which was projected to generate P30.1 billion in the first year of implementation.

HOPING
Mr. Lambino said there is still a possibility that the rates may be increased as Senator Sherwin T. Gatchalian had disclosed plans to possibly amend the measure in the plenary and instead impose a P70 per pack rate.

“I believe Sen. Gatchalian, who sponsored a version of the bill, will propose to use the rates he included in his bill, which starts at P70,” Mr. Lambino said in a separate text message on Sunday.

“We also have a proposal for raising alcohol excise to P40/liter, which is estimated to bring in around P30 billion.”

The said proposal, carried under SB 2197 awaits approval at the committee level with less than two weeks left for this 17th Congress to wrap up its business; while its counterpart, House Bill No. 8618, was approved on third and final reading in December last year.

The Senate Bill, which will be sponsored for plenary approval on Monday, further provides for a P5 annual increase until it reaches P60 per pack in 2023 and by five percent every year thereafter.

Mr. Lambino said this will generate an estimated “P18B[illion], [P]24B[illion], [P]26B[illion], and [P]28B[illion] in each of the years that follow up to 2024. Those are the incremental revenues.”

The DoF has noted that implementation of Republic Act No. 11223, or the Universal Health Care Act, will cost around P258 billion, which may be partially covered by national budget, the Philippine Amusement and Gaming Corp. and the Philippine Charity Sweepstakes Office in the amount of P195 billion.

It also noted that while current funding sources can cover P200 billion, it will not be sufficient as the UHC law’s implementation cost is expected to grow up to P1.44 trillion in 2020-2024.

Mr. Lambino said that “[t]he funding gap for full implementation of UHC (Universal Health Care) is [P]63B[illion] for 2020 and P73 [billion], [P]85 [billion], [P]95 [billion] and [P]109B for subsequent years up to 2024.”

“If in the end a funding gap remains, then coverage will be adjusted by DoH,” he explained when asked on contingencies for the funding shortfall.

“All Filipinos will still be covered, but the package will not include everything currently proposed.”

A DoF statement last weekend quoted Finance Secretary Carlos G. Dominguez III as saying: “With less than three session weeks left, I appeal to the Senate to prioritize increasing excise taxes on tobacco and alcohol.”

“This reform is already in an advanced stage, so there is just enough time to deliberate, pass and ratify the measure.”

The 17th Congress has six session days to tackle the proposed tobacco tax hike at the bicameral conference committee and ratify for President Rodrigo R. Duterte’s signature ahead of the June 7 adjournment.

The House of Representatives had approved its version, under House Bill No. 8677, on third and final reading in December last year. It proposed to increase tobacco excise tax by P2.50 per pack annually until it reaches P45 per pack in 2022, and by four percent annually thereafter.

Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN) Law, increased among others the tobacco excise tax to P32.50 per pack from P30 in January 2018 and then increased it to P35 in July 2018.

It is scheduled to go up to P37.50 in January 2020.

Moreover, Mr. Dominguez also appealed to the 18th Congress to continue legislating the administration’s remaining proposed fiscal reforms, which he said could bag another credit rating upgrade.

S&P Global Ratings last April 30 raised the Philippines’ credit rating by a notch, citing above-average growth and strong external and fiscal position which have boosted the country’s economic profile. The debt watcher raised the country’s long-term sovereign credit rating to “BBB+” from “BBB,” bringing it a step closer to bagging a single “A” grade. S&P assigned a “stable” outlook to the rating, which means it expects to maintain its grade in the next six months to two years as the economy is likely to remain strong over the medium term.

Moody’s Investors Service and Fitch Ratings have so far kept the country a notch above minimum investment grade at “Baa2” and “BBB”, respectively.

“All of these will translate into larger investments and more jobs for Filipino workers. So, you see, it is not just about getting an upgrade. It is about upgrading everyone’s life,” Mr. Dominguez said.

Banks post bigger returns, capital buffers but slower asset, loan growth

By Christine Joyce S. Castañeda
Senior Researcher

THE COUNTRY’s biggest banks saw their profitability and capacity to absorb risky assets improve in the first quarter, even as asset and loan growth eased.

The first quarter edition for this year of BusinessWorld’s Quarterly Banking Report shows the combined assets of 46 universal and commercial banks (U/KBs) grew 10.91% to P16.66 trillion in the January-March period from P15.02 trillion in the same three months last year.

The first-quarter asset growth was slower than the 11.4% recorded in the fourth quarter of 2018 and 11% in 2018’s first quarter.

Bank loans, which made up around 54.4% of big banks’ assets last quarter, totaled P9.06 trillion, up 12.4% from last year’s P8.07 trillion. This is slower than the 15.1% year-on-year loan growth in 2018’s last quarter and the year-ago 17.8%.

In terms of profitability, the median return on equity (RoE) improved to 8.1% from 5.4% in the fourth quarter and 5.1% in 2018’s comparable three months. RoE, which is the ratio of net profit to average capital, measures how well a company makes use of the money from shareholders to generate income. Put another way, it measures the amount that shareholders make on every peso they invest in a company.

BDO Unibank, Inc. (BDO) continued to have the most assets among U/KBs, followed by Metropolitan Bank & Trust Co. (Metrobank) and the Bank of the Philippine Islands (BPI).

BDO issued the most loans at P1.97 trillion. BPI displaced Metrobank in second place in terms of loans, with the former having P1.34 trillion, and the latter, P1.33 trillion.

Among banks with assets of at least P100 billion, China Banking Corp. posted the fastest asset growth of 23.5% year-on-year. It was followed by Philippine National Bank’s 20.6% growth and East West Banking Corp.’s 17.7%.

The first three months saw Bank of Commerce as the most aggressive lender, with a year-on-year growth of 27.6%, followed by Development Bank of the Philippines with 26.6% and Robinsons Bank Corp. with 23.8%.

In terms of deposits, BDO remained on top with P2.36 trillion. Land Bank of the Philippines came in second at P1.68 trillion, followed by BPI’s P1.61 trillion.

ASSET QUALITY
Meanwhile, the banks’ median capital adequacy ratio — or the ability to absorb losses from risk-weighted assets — improved to 18.8% in the first quarter from the previous quarter’s 17.9% and the past year’s 18.2%.

The ratio remains well above the regulatory minimum of 10% set by the Bangko Sentral ng Pilipinas as well as the international standard of eight percent.

Nonperforming asset ratio — nonperforming loans and foreclosed properties in proportion to total assets — rose to 0.7% from 0.6% in the preceding quarter.

On the other hand, nonperforming loan (NPL) ratio of the biggest banks worsened to 1.53% from 1.45% three months prior.

As percent of total assets, foreclosed real and other properties roughly steadied at 0.3% in the first quarter.

Banks’ coverage ratio — the ratio of the total loan loss reserves to gross NPL — was 117.7% during the quarter. This was lower than the 130.6% in the preceding three months but still more than enough to cover the entire value of bad loans held by the country’s big banks, with loan loss reserves totaling P158.34 billion.

Since 1987, BusinessWorld has been tracking the quarterly performance of the country’s largest lenders based on their published statements of condition.

The quarterly banking report ranks banks in terms of size of their balance sheet and presents other key ratios used in measuring bank performance, such as capital adequacy, earnings and liquidity.

This issue marks the entry of Industrial and Commercial Bank of China, Ltd.-Manila Branch to the list after starting operations on Feb. 14.

Combined assets of the Philippines’ Universal and Commercial Banks (U/KBs) reach P16.66 trillion as of first quarter of 2019

Combined assets of the Philippines’ Universal and Commercial Banks (U/KBs) reach P16.66 trillion as of first quarter of 2019

BusinessWorld economic forum tackles next-wave disruptions, opportunities

BUSINESSWORLD Economic Forum 2019 takes place on May 30 at the Grand Ballroom of Grand Hyatt Manila in Bonifacio Global City, Taguig City with the theme “The Future of Business: Next-wave Disruptions & Opportunities” and Jaime Augusto Zobel de Ayala, chairman and chief executive officer (CEO) of Ayala Corp., as keynote speaker.

Mr. Zobel will share how Ayala Corp. — one of the oldest and biggest conglomerates in the Philippines with interests in real estate, banking, telecommunications, water, power, industrial technologies, infrastructure, health care and education — has been embracing disruptions and seizing opportunities brought about by emerging technologies.

The whole-day forum will bring together thought leaders, industry experts, business executives, government policy makers, innovators, academicians, technology providers and other leading figures in the public and private sectors to share their insights on the promises and risks of technology and how they could impact businesses over the next 10 years.

The first session on “Automation & Artificial Intelligence and How They Will Impact People, Skills, and Management” will discuss benefits and adverse effects of job automation and artificial intelligence adoption. The session also aims to answer questions on the implications of Generation Z to the workforce.

To share their knowledge on the topic are McKinsey & Company Managing Partner for the Philippines Kristine Romano, Management Association of the Philippines President Rizalina G. Mantaring, Degreed vice-president for Global Business Solutions Susie M. Lee and Acumen Strategic Consulting, Inc. Managing Director Pauline G. Fermin. Panel discussion will be moderated by BusinessWorld Editor-in-Chief Roby Alampay.

The second session — “Digital Commerce and How Big Data & Mobile Technology Will Shape the Future of Retail” — will tackle the continuing expansion of e-commerce that is projected to become a multi-billion peso industry in a few years. Speakers for this session are Boston Consulting Group Singapore Partner and Managing Director Shiv Choudhury, Globe Telecom, Inc. Senior Vice-President for Globe Business Peter D. Maquera, Lazada Philippines CEO Raymond N. Alimurung, and Entrego President Constantin Robertz. Panel discussion will be moderated by One News Anchor RJ Ledesma.

The third session, “Financial Technology & The Future of Money,” will discuss financial sector developments such as financial technology (fintech), blockchain, cryptocurrency and cashless economy, and how these trends will reshape various industries. Frost & Sullivan Asia Pacific Managing Director and Partner Shivaji Das, Bank of the Philippine Islands (BPI) Chief Digital Officer Noel A. Santiago, FinTechAlliance.ph Founding Chairman Lito M. Villanueva, and Bangko Sentral ng Pilipinas Senior Director and Officer-in-Charge for Fintech Sub-Sector Vicente T. De Villa III will share their thoughts about the topic. Panel discussion will be moderated by One News Anchor Daniela Laurel.

The last session — on “Next-Generation Technology and The Future of Economy” — will tackle emerging technologies and their potential contribution to economic growth. To lead discussions are Alliance Global Group, Inc. CEO Kevin Andrew L. Tan, Microsoft Philippines Country General Manager Andrés Ortola, MFT Group of Companies CEO Maria Francesca F. Tan, and IBM Philippines President and Country General Manager Aileen Judan-Jiao. Panel discussion will be moderated by BusinessWorld SparkUp Editor Santiago J. Arnaiz.

BusinessWorld Economic Forum has been held annually since 2016. It serves as a platform for industry leaders and key figures in the society to discuss key challenges that affect the country.

BusinessWorld Economic Forum 2019 is presented by LT Group, Inc., Entrego and GT Capital Holdings, Inc. with sponsors: (Platinum) Megaworld Corp.; PLDT, Inc.; Toyota Motor Philippines Corp. and Lexus; (Gold) Ayala; BDO Unibank, Inc.; Federal Land, Inc.; MFT Group; Metro Pacific Investments Corp.; San Miguel Corp., SM Investments Corp. and Turkish Airlines; (Silver) Aseana City; FWD; Globe, Manila Electric Co. and Rizal Commercial Banking Corp.; as well as (Bronze) Aboitiz Equity Ventures, Inc.; BPI; Double Dragon Properties Corp.; First Gen Corp.; National Home Mortgage Finance Corp.; Pag-IBIG; SGV; Viventis and Degreed; Wilcon Depot and Cross; with partners Grab (mobility), The Philippine Star (print), One News (broadcast), and Fiera De Manila, Inc. (event).

To register and for more information, please visit www.bworldonline.com/businessworld-economic-forum-2019 or call BusinessWorld’s marketing department at 535-9901 local 707. Registration is open until May 28.

Maynilad allots P16.8 billion for expansion projects this year

MAYNILAD Water Services, Inc. is setting aside P16.8 billion for capital expenditures this year, focusing mainly on wastewater projects in the west zone concession area.

“Maynilad is dedicating a bigger share of this year’s capital investment toward wastewater projects, as we seek to facilitate sewerage coverage expansion in the West Zone,” Maynilad President and Chief Executive Officer Ramoncito S. Fernandez said in a statement yesterday.

“Accelerating our wastewater projects will require a lot of resources but we are committed to do our part in protecting the health of our customers and the environment,” he added.

This year’s P16.8-billion capex is 87% higher than the P9 billion earmarked for expenditures last year. Maynilad earlier announced it is allotting P100 billion for capex until 2022, most of which will be dedicated to building new sewage treatment plants (STPs).

Maynilad said around P11.4 billion of this year’s budget will be spent on wastewater management projects, such as the construction of a new STP in Central Manila. It is also upgrading old STPs to have nutrient-removal processes and installing new sewer service connections including about 30 kilometers of sewer lines in Las Piñas City.

Some P3 billion of the capex will go to non-revenue water management program, or Maynilad’s water loss recovery system, which includes services such as leak detection and repair, meter management, pipe replacements and network diagnostics.

About P1.9 billion will be allocated for water operations support like the construction of additional pumping stations and reservoir, service expansion programs and water source projects. These are all investments geared towards improving the water supply and pressure in the west zone concession area.

The remaining funds will be dedicated to customer service and information program improvement.

Maynilad said it will source its capex from internally generated funds and bank loans both in and out of the country.

Metro Pacific Investments Corp., which has majority stake in Maynilad, is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — Denise A. Valdez

Investors snap up Globe shares as telco stands by Huawei amid US trade blacklist

By Marissa Mae M. Ramos
Researcher

INVESTORS bought Globe Telecom, Inc. shares last week following the company’s announcement it will continue to partner with Huawei Technologies Co. Ltd. despite the United States placing the Chinese tech giant on a trade blacklist.

The Ayala-led company was the ninth most actively traded stock in terms of value turnover with a total of 429,740 shares worth P898.4 million having exchanged hands on the trading floor from May 20 to May 24, according to data from the Philippine Stock Exchange (PSE).

The stock price closed on Friday at P2,088 per share, down 0.57% from the previous day. It was, however, up 4.5% from its closing price of P1,999 on Friday the week before. Year to date, it is up 9.9%.

Unicapital Securities, Inc. Technical Analyst Cristopher Adrian T. San Pedro attributed Globe’s stock movement to two things: net foreign buying and the company’s statement on reaffirming its partnership with Huawei amid the United States and other countries cutting ties with Huawei and other Chinese technology companies due to security concerns.

Data from the PSE showed net foreign buying for Globe stood at P403.1 million last week, 308.1% more than its recorded P98.8 million the previous week.

“Globe stands by Huawei and will continue to sell handsets and (buy) network gear from the Chinese firm despite the ongoing trade blacklisting by the US government,” Mr. San Pedro said in an e-mail.

“The company also reassured investors that their P63-billion capital spending on network rollout and 5G launch will not be disrupted by the ongoing trade war,” he added.

Globe President and Chief Executive Officer Ernest L. Cu said on Thursday that it affirmed its tie-up with Huawei, noting the 5G network is scheduled to launch next month.

Earlier last Monday, telco giants Globe and PLDT, Inc. announced they are working with Huawei to address customer concerns as Alphabet, Inc.’s Google is suspending ties with the Chinese tech firm amid the US-China trade war.

Reuters had reported on Tuesday that the US Commerce department granted Huawei a license to buy US goods until Aug. 19 to keep its existing telecoms networks and provide software updates to Huawei smartphones.

Google’s withdrawal of Huawei’s license to use its Android operating system means that Google services relating to the transfer of hardware, software, and technical services will no longer be available on Huawei devices, except those available through Android’s open source license. It also means future Huawei devices powered by Android will lose access to Google applications such as Google Play Store, Gmail, and YouTube. It will still, however, be available on existing Huawei devices.

Earlier this year, Globe had already partnered with Huawei in the development of the local company’s 5G network intended to accelerate its broadband speed from 50 Megabits per second (Mbps) to 100 Mbps.

The high-speed network is targeted to be launched by next month to locations with a high density of cell sites such as Metro Manila and other urban areas.

The telco company’s net income attributable to parent surged 43.74% to P6.73 billion in the first quarter of 2019 from P4.68 billion at the same time last year.

“As the company continues to upgrade its network infrastructure (4G LTE and 5G), the margins are expected to remain flat this year but will recover starting 2020,” said Unicapital’s Mr. San Pedro.

“I expect the net income for this year to hit at least P20 billion to be driven by mobile data and fixed home broadband revenues as the company continues to expand its market share in the Philippine market.”

In the coming weeks, Mr. San Pedro sees Globe trading sideways with support at P2,000 and resistance at P2,152 “with the possibility of testing P2,200 and P2,280 if it stays above P2,000 in the short term.”

For Timson Securities, Inc. trader Jervin S. de Celis: “Globe might struggle going beyond P2,150 as this area served as a previous resistance level in 2017 and 2018. For the support, the stock may experience a pullback to its nearest support at P2,000. It should hold above that level before retesting the 2,150.”

NFA to stop selling rice at a loss to relief agencies

THE National Food Authority Council (NFA) has approved the sale of rice to institutional buyers, including local government units (LGUs), at P37 per kilo, in order to make the NFA’s operations more self-sustaining, the Department of Agriculture said.

“The NFA also approved a resolution which sets the price for the rice that we will sell to LGUs and even private NGOs. We will not sell at P27 (per kilo), we will sell at P37 (per kilo),” Agriculture Secretary Emmanuel F. Piñol told reporters at a news conference.

To be affected are institutional buyers like the Department of Social Welfare and Development (DSWD), LGUs, Non-Government Organizations, the Philippine National Red Cross (PNRC), and the National Disaster and Risk Reduction Management Council (NDRRMC).

He said the old selling price of P27 produces losses for the NFA, though that price will still apply to areas suffering from shortages.

The NFA has had to pay out significant incentives to attract sellers of palay, or unmilled rice, ever since its mandate shifted primarily to procuring rice from domestic farmers in order to maintain a buffer stock.

The NFA procures palay at P20.70.

Mr. Piñol said that under the new pricing, he expects the NFA to earn at least P1 per kilo.

“The NFA will now conduct surgical marketing operations. Ibig sabihin [This means]… we will not operate in areas where there is a surplus of rice stocks. Ang focus namin [Our focus] will be Metro Manila and net importing provinces,” he said.

He also said that the council has identified 40 areas with high poverty incidence for targeted sales, which will start in September, when the distribution of domestically-procured rice to the market will start, coinciding with the lean months for rice supply.

The NFA is still running down its last inventories of foreign rice after its importing function was taken away from it this year. The Rice Tariffication Law liberalizes rice imports by private entities, leaving the NFA to maintain a buffer stock from domestic rice.

As of May 20, the NFA has procured a total of 4.025 million bags of palay from farmers.

Meanwhile, Mr. Piñol said the price of rice has stabilized, while the buying price of palay has increased, addressing the concerns of both consumers and farmers.

Inflation spiked in 2018, while the threat of competition from cheap foreign grain, which will be imported more freely, also pressured palay farmgate prices, threatening farmer incomes.

In the first week of May, the average farmgate price of palay rose 0.3% week-on-week to P18.45 per kg, the Philippine Statistics Authority said.

The average wholesale price of well-milled rice decreased 0.4% to P39.55 compared with the previous week. At retail, the price fell 0.5% to P43.30 per kg.

The average price of regular-milled rice at wholesale fell 0.5% to P36 during the period. At retail, the price of regular-milled rice fell 0.5% to P38.97. — Vincent Mariel P. Galang

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