DBM outlines plan to immunize spending from Congress tweaks

January 22, 2025 | 8:24 pm

THE Department of Budget and Management (DBM) said it has prescribed measures for agencies finding their budgets disrupted by last-minute adjustments by Congress.

“This is to clarify matters pertaining to the instruction of President Ferdinand R. Marcos, Jr. to various National Government Agencies (NGAs) to ensure sufficient funding of legacy projects and programs, which were affected by Congress-introduced changes or adjustments in the 2025 General Appropriations Act (GAA),” the DBM said in a statement.

Mr. Marcos had directed agencies to focus on programs ready for implementation and to look for possible savings that can be reprogrammed, in light of “suboptimal” spending plans resulting from budget cuts.

The DBM said it is committed to remedy any funding deficiencies of various departments in 2025, through the use of the Contingent Fund or Unprogrammed Appropriations, as well as savings realized by the agencies.

It said any such releases are subject to conditions and requirements prescribed in the applicable Special and General Provisions contained in the P6.326-trillion 2025 GAA.

“First, available allotments within an agency’s budget can be declared as savings, as defined in Section 77 of the General Provisions of the 2025 GAA. The utilization of these funds will be subject to the rules on augmentation provided in Section 78,” it said.

Tapping of the Contingent Fund — which is used exclusively for requirements of new and/or urgent projects and activities — must be paid during the year, and requires Presidential approval.

The DBM also listed the infrastructure and social programs that may be covered by Unprogrammed Appropriations. The conditions attached to the use of such funds include the availability of excess revenue, which must be certified by the Bureau of the Treasury.

“We are one with the President in addressing the validated funding deficiencies,” the DBM said.

“Nevertheless, it is understood that the process and procedures to be undertaken shall strictly adhere to budgeting, accounting, and auditing laws, rules and regulations,” it added.

In a separate statement, the DBM also rejected allegations that it altered the GAA.

“There is no truth to the rumors disseminated by fake news peddlers and professional government destabilizers that the DBM edited the 2025 General Appropriations Act to fill in the blanks, as there is no single page or figure missing from the 2025 GAA,” the DBM said. — Aubrey Rose A. Inosante

‘Moderate’ global FDI growth seen on improved financing, pickup in M&A

January 22, 2025 | 8:24 pm

GLOBAL foreign direct investment (FDI) flows are expected to post moderate growth this year, driven by strong economic prospects in the US and the European Union (EU), according to the United Nations Conference on Trade and Development (UNCTAD).

In its Global Investment Trends Monitor, UNCTAD said that it is “cautiously optimistic” about global FDI growth this year.

“Looking to 2025, moderate FDI growth is expected, supported by improved financing conditions and renewed M&A (mergers and acquisitions) activity. However, risks and uncertainties — including geopolitical tensions and global economic instability — pose significant challenges,” it said.

In 2024, global FDI flows grew 11% to $1.4 trillion. However, flows dropped 8% when financial flows through European conduit economies are excluded.

“Greenfield project announcements, primarily in industrial sectors, saw a moderate decline of 8% in number and 7% in value,” UNCTAD said.

“Despite the drop, the value of greenfield projects remained high, second only to the record reached in 2023, driven by large-scale investments in semiconductor manufacturing and AI technologies,” it added.

UNCTAD said that it expects FDI flows to grow more rapidly in the US due to strong economic growth prospects and in the European Union, which currently has very low levels of investment.

According to the report, North America posted a 13% rise in FDI in 2024 due to an 80% increase in M&A, while FDI in Europe fell 45% with 18 out of 27 EU countries seeing drops.

Meanwhile, UNCTAD said that regions that are well connected to major developed markets could benefit from global supply chain restructuring.

These include ASEAN, Eastern Europe, West Asia, North Africa, and parts of Central America.

ASEAN posted 2% growth in FDI last year to $235 billion. This is a record for the 10-economy bloc.

Asia had a 7% decline in FDI, Latin America and the Caribbean a 9% drop, and Africa an 89% jump to $94 billion.

“The continued decline in greenfield investments and international project finance underscores the need for robust, diversified strategies to attract and sustain investment, especially in sectors critical for sustainable development,” UNCTAD said.

“For both developed and developing economies, the stakes are high as they navigate this complex landscape,” it added. — Justine Irish D. Tabile

Negros, Catanduanes, Leyte port rehab, expansion deals awarded

January 22, 2025 | 8:16 pm

DoTr-Virac port — DOTR FACEBOOK FILE PHOTO

THE Philippine Ports Authority (PPA) said it awarded expansion and rehabilitation contracts for three ports, valued at a combined P773 million.

In separate notices posted on its website, PPA said it awarded the contract for the San Carlos, Negros Occidental port improvement project; the Virac, Catanduanes port rehabilitation project; and the San Ricardo, Southern Leyte port expansion project.

The PPA said the San Carlos contract of P350.13 million was awarded to Silver Dragon Construction and Lumber and Glass Supply, Inc.

The Bacolod City-based company will have 630 days to complete the improvement works.

Meanwhile, a Bicol-based construction company, Bemkar Construction and Supply, bagged the P119-million Virac project.

The company was given 450 days to complete the rehabilitation works.

Additionally, the PPA said Quezon City-based MRBII Construction Corp. secured the P303.80-million San Ricardo expansion and upgrade contract, which it was given 660 days to complete.

For the year, PPA said it will continue accelerate its infrastructure projects to help sustain cargo and passenger volume growth.

Between 2024 and 2028, the PPA has allocated about P16 billion to fund infrastructure works, including 14 flagship projects. — Ashley Erika O. Jose

Can a discount be a gift?

January 22, 2025 | 8:12 pm

As we hold public officers and employees to higher standards of conduct and ethics, we also recognize the importance of supporting them in fulfilling these exacting principles of public service. This will reduce the burden of generally perceived low wages, and even boost morale. Given limited resources, it has become a normal practice for concerned and reputable businesses to voluntarily provide their services at discounted prices, with the aim of contributing to the well-being of those who serve the public.

For several years, the Civil Service Commission has teamed up with numerous private business establishments to offer discounts and freebies to civil servants and retired government workers. These business establishments include banks, food chains, retail stores, health and wellness clinics, travel agencies, hotels, and amusement parks. In fact, not a few airlines have partnered and signed a Government Fares Agreement with the Procurement Service of the Department of Budget and Management to give discounted fares to government employees on official business trips. Even government workers using the MRT and LRT fares have been given discounts.

In August, the Bureau of Internal Revenue (BIR) issued Revenue Memorandum Circular (RMC) No. 88-2024, publishing the full text of the Memorandum of Agreement (MoA) between the BIR and the Philippine-Chinese Charitable Association, Inc. (PCCAI). The PCCAI is the owner and operator of the Chinese General Hospital and Medical Center.

Under the MoA, the PCCAI offers its medical facilities and services at a discount to the BIR for a year (subject to extension), through its hospital as a charitable project. PCCAI is to provide diagnosis and treatment to officials and employees of the BIR and grant a 50% discount on charges for room occupancy and a 30% discount on laboratory (except blood related procedures), pulmonary (except for the embedded professional fee in ABG) and x-ray (except handling fee) services. This also includes out-patient medical services but excludes the cost of medicine. With this MoA, the BIR aims to provide adequate medical services available to its officials and employees thereby ensuring their health, welfare, and safety.

The MoA clearly provides BIR officials a brief respite to the high cost of medical services in the Philippines, and both the BIR and PCCAI can be lauded for coming up with this. To the curious though, how are these discounts to government workers viewed under Philippine law?

Discounts may potentially be seen as “gifts.” Republic Act (RA) No. 6713 or the Code of Conduct and Ethical Standards for Public Officials and Employees, defines a “Gift” as referring to a thing or a right to dispose of gratuitously, or any act or liberality, in favor of another who accepts it. It does not include an unsolicited gift of nominal or insignificant value not given in anticipation of, or in exchange for, a favor from a public official or employee. What is considered a gift of nominal value will depend on the circumstances of each case, taking into account the salary of the official or employee, the frequency or infrequency of the giving, the expectation of benefits, and other similar factors.

The RA prohibits public officials and employees from soliciting or accepting (either directly or indirectly) any gift, gratuity, favor, entertainment, loan or anything of monetary value from any person in the course of their official duties or in connection with any operation being regulated by, or any transaction that may be affected by the functions of their office.

Moreover, RA 3019, or the Anti-Graft and Corrupt Practices Act and its Implementing Rules and Regulations (IRR), define the act of “receiving any gift” by a public officer as including accepting, directly or indirectly, a gift from a person other than a member of the public officer’s immediate family, on behalf of himself or of any member of his family or relative within the fourth civil degree (either by consanguinity or affinity), even on the occasion of a family celebration or national festivity like Christmas, if the value of the gift is under the circumstances manifestly excessive.

With the oft-repeated adage that a public office is a public trust, it has been the consistent policy of the State to promote high ethical standards in public service. Thus, public officials and employees are encouraged to discharge their functions with the utmost responsibility and integrity.

While discounted healthcare is a tremendous gift in the general sense, in my view, it does not appear to violate the prohibitions under the RA since the discount seems gratuitously given to everyone at the BIR. Likewise, the BIR’s acceptance is made in consideration of its employees’ health, welfare, and safety. It does not appear to be given by PCCAI in the course of the BIR’s conduct of official duties, or connected to any operation or transaction that may be affected by the functions of their office.

Perhaps some may be concerned that unlike the discounts given by other private businesses to all government workers, the discount under the MoA is given only to a specific government agency — the BIR. As humans, we may, at times, be influenced by special treatments given to us. Perhaps, in the future, a partnership that involves the broader government, though possibly with a lower discount, might warrant less scrutiny.

The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of Cabrera & Company. The content is for general information purposes only, and should not be used as a substitute for specific advice.

Charilyn Caliwag is a senior legal advisor of Cabrera & Co., a Philippine member firm of the PwC network.

charilyn.caliwag@pwc.com

Tabuena leads local golfers in Philippine Open

January 22, 2025 | 7:47 pm

MIGUEL TABUENA — FACEBOOK.COM/ASIANTOURGOLF

Smart Infinity Philippine Open — newly revived and reintegrated into the Asian Tour

CARMONA, Cavite — For a pro golfer, nothing beats the feeling of hoisting his country’s National Open against an international field in front of kababayans and loved ones.

This essentially will serve as the driving force for 39 Filipino bets as they vie for honors in the Smart Infinity Philippine Open — newly revived and reintegrated into the Asian Tour — for the next four days at the Manila Southwoods Golf and Country Club.

“It’s nice to have the Asian Tour here this week, it’s nice to be playing at home. Hopefully we can keep the Philippine Open with Filipino hands,” Pinoy star Miguel Tabuena said on the eve of the $500,000 event, which marks the Open’s first staging since 2019 as well as its return to the Tour after a decade-long absence.

Mr. Tabuena is gunning for a third crown after prior triumphs in 2015 — the last time the tourney was played as part of the Continental circuit — and 2018.

“Like any other event that I play, I want to win and hopefully, I can win for the third time,” he said.

The 30-year-old leads the local charge that includes former winners Angelo Que (2008) and Gerald Rosales (2000), Justin de los Santos, Tony Lascuña and top female amateur Rianne Malixi against crack foreign bets headlined by former champion Steve Lewton, LIV Golf star Chase Koepka and Tour Order of Merit champions Sihwan Kim, Jazz Janewattananond and Liang Wenchong.

“I’m going against guys who are half my age so I’m going to take it easy,” said 46-year-old Mr. Que ahead of his “homecoming.”

“It’s a plus that we’re playing here in Manila Southwoods, my home course. I’ve been here for 26 years. I’m here everyday. Pressure (of being one of the Filipino stalwarts) is there but I won’t think too much about it.”

With the hazard-laden 7,138-yard Masters course reimagined into a challenging par-70 layout, precision and composure would be key.

“It’s much tougher,” Mr. Tabuena said of the Jack Nicklaus-designed course.

“Some of the players who aren’t long off the tee will have trouble especially with the rough being this long. But I believe there’s still some local knowledge out there to be used and I have some of that for sure.”

Mr. Que shared this sentiment.

“I think off the tee, you need to find the fairways because the rough’s a bit thick, eh. So if you can find the fairways more, then you have better chances of going for the pin,” he noted.

“And with wind blowing now like this (mid-day), it’s going to be challenging for everybody.” — Olmin Leyba

Swiatek charges into Australian Open semifinals; Keys overpowers Svitolina

January 22, 2025 | 7:47 pm

1 of 2

MELBOURNE — A rampaging Iga Swiatek stormed into her second Australian Open semifinal with a 6-1, 6-2 center court demolition of eighth seed Emma Navarro on Wednesday as the world number two underlined her title credentials once again at Melbourne Park.

The quarterfinal passed with a note of controversy, though, with Swiatek scooping up a drop shot that looked perilously close to a double-bounce in the fifth game of the second set, which proved a hammer blow for Navarro.

A throbbing ball of energy from the first point to the last, Swiatek’s win at a sun-drenched Rod Laver Arena set up another American match-up with Madison Keys, who overhauled Elina Svitolina 3-6, 6-3, 6-4 in the earlier quarterfinal.

“I think it was much more tougher than the score shows,” Swiatek said on court.

The Pole has a 4-1 record against her next opponent Keys but expected a tough test against the American.

“Madison is a great player and really experienced, so you never know. The match that I lost, she kind of killed me, so I think it can be tricky,” she added.

After beating Ukrainian Svitolina, Keys had said she looked forward to cheering on Navarro as her compatriot took on the five-time Grand Slam champion.

But she was left to ponder the scale of her task as she looks to secure her first Grand Slam final since the 2017 US Open.

Most eyes had been focused on the top half of the women’s draw, where favorite and double-defending champion Aryna Sabalenka booked a semifinal with Paula Badosa on Tuesday.

But it may be the free-swinging Swiatek in pole position for the title, having conceded only 14 games in her five matches.

Though the scoreline suggested otherwise, Navarro gave Swiatek a proper battle in the second set and had a breakpoint in the fifth game tinged by controversy.

Swiatek bolted forward to retrieve a drop shot that appeared to have bounced twice on certain angles of the replay before her racket scooped it up.

Play went on, though, with Swiatek winning both the point and the game with a passing shot, leaving Navarro to remonstrate fruitlessly with the chair umpire.

Navarro could not recover from the blow, losing the next three games to bow out.

While Swiatek squandered a first match point with a poor return into the net, she sealed it on the second when a desperate Navarro fired just wide of the line.

FEARLESS
Keys had earlier blasted into a third Australian Open semifinal with characteristic aggression to notch up her 10^th win in succession.

“To be here 10 years later in the semifinals again, I’m really proud of myself and really excited to play another semifinal here in Melbourne,” said Keys, who reached the last four in 2015 and 2022.

“I kind of just had to start playing a little bit more aggressive and try to get to the net a bit quicker.

“I think I played a little bit smarter for sure. Probably a little bit less fearless.”

The 29-year-old from Rock Island, Illinois had lost the last two of her three Grand Slam match-ups with Svitolina, most recently in the fourth round of the 2019 US Open.

And she appeared set for another setback as the counter-punching Ukrainian took full advantage of Keys’ early waywardness on a cool and breezy morning.

Keys dropped serve in the eighth game with an unforced error and then gifted the set with another error as Gael Monfils nodded approval at his wife Svitolina from the player’s box.

Keys raised her game, though, pressuring Svitolina on serve to earn a breakpoint in the fourth game of the second set.

But Svitolina saved it with a brilliant reflex volley that left the American smiling ruefully.

Two games later, Svitolina finally buckled on serve as Keys found her range with a forehand winner. Keys had two set points at 5-3 but blew one with a wild forehand into the tramlines before closing it out with a big serve.

She kept up the firepower, raising two break points at 2-2 in the third set with a forehand down the line before taking Svitolina’s serve with a ferocious backhand return.

Keys marched on in a barrage of power hitting, claiming the win on the first match point when a harried Svitolina thumped a backhand well past the baseline. — Reuters

PLDT battles Choco Mucho for magic 4 slot

January 22, 2025 | 7:43 pm

Games on Thursday
(PhilSports Arena)
4 p.m. – Akari vs Nxled
6:30 p.m. – Choco Mucho vs PLDT

PLDT eyes to stay inside the magic four while Choco Mucho fights for it as the two collide Thursday in the Premier Volleyball League All-Filipino Conference at the PhilSports Arena.

The High Speed Hitters settled an old score with the Akari Chargers following a quick, merciless 25-22, 25-16, 25-15 victory on Saturday that sent it inside the magic four with a 4-2 record.

But more than exacting revenge on the franchise that denied it a potential title shot in the Reinforced Conference last year, PLDT spiker Savi Davison said it was all about starting the year right.

“I think the most important part was winning our first game in 2025 and starting on a high note,” said Ms. Davison, who is expected to carry the cudgels anew after dropping a 15-point effort in that ghastly decimation over Akari.

The Flying Titans, for their part, aim to barge into the top four and improve on their 4-3 record.

Choco Mucho, which survived ZUS Coffee’s upset try with a come-from-behind 20-25, 20-25, 25-22, 25-22, 15-9 win also on Saturday, however, will be minus star spiker Kat Tolentino.

Ms. Tolentino will be out for a while after going under the knife to remove a ruptured appendix on Tuesday, which would be a big blow to a franchise seeking to boost its stock.

Game time is at 6:30 p.m.

Meanwhile, sister teams Akari (3-4) and Nxled (0-6) tangle at 4 p.m. — Joey Villar

Jalen Brunson heats up late, lifts Knicks over Nets

January 22, 2025 | 7:43 pm

JALEN BRUNSON was held to 17 points but delivered the go-ahead basket with 2:18 remaining for the visiting New York Knicks, struggled on offense for most of the fourth quarter before making enough plays down the stretch in a 99-95 victory over the Brooklyn Nets on Tuesday.

Brunson missed 10 of his first 14 shots before hitting three baskets and scoring eight points in the last 2:18 to give New York a ninth straight win over the Nets.

His first clutch hoop was a 13-footer from near the baseline that gave the Nets a 91-90 lead off a feed from Karl Anthony-Towns. Brunson added a layup through traffic off a pass from Josh Hart for a 93-90 edge with 1:56 remaining.

After Brooklyn’s Keon Johnson hit two free throws, Brunson sank a jumper from near the foul line to make it 95-92 with 1:25 left. Following a dunk by New York’s OG Anunoby, D’Angelo Russell hit a 3-pointer to bring Brooklyn within 97-95 with 52 seconds left.

Brunson had a chance to clinch it but missed a runner in the lane with 32.3 seconds to go. After Brooklyn took its final timeout with 23 seconds remaining, the Nets’ Cameron Johnson missed a deep 3-point attempt from the top of the key with 15.3 seconds left. Brunson sank two free throws with seven seconds remaining to ice it.

Towns amassed 25 points, 16 rebounds, and six assists. Anunoby added 20 points for the Knicks, who earned the win despite scoring only 15 points in the fourth.

Russell led the Nets with 23 and 10 assists but shot 6-for-17 from the floor. Cameron Johnson added 13 points but was 6-for-20 from the field. Brooklyn shot 37.2%, lost its eighth straight home game and fell for the ninth time in 10 games overall.

The game marked the return of Mikal Bridges to Brooklyn after the Nets dealt him to the Knicks for five first-round picks last summer. Bridges was held to 10 points on 3-of-12 shooting.

Towns finished off a three-point play with 4.7 seconds left in the second quarter to give the Knicks a 59-51 halftime lead. The Knicks opened a 76-64 advantage on Hart’s layup with 4:46 left in the third quarter before taking an 84-75 lead into the fourth. — Reuters

Trump stirs tariff pot with fresh threats on EU, Feb. 1 China deadline

January 22, 2025 | 6:10 pm

Ship-port-containers — SHIPPING CONTAINERS are seen at a port in Shanghai, China ,July 10, 2018. — REUTERS FILE PHOTO

WASHINGTON — US President Donald Trump on Tuesday vowed to hit the European Union (EU) with tariffs and said his administration was discussing a 10% punitive duty on Chinese imports because fentanyl is being sent from China to the US via Mexico and Canada.

Mr. Trump voiced his latest tariff threats in remarks to reporters at the White House a day after taking office without immediately imposing tariffs as he had promised during his campaign.

Financial markets and trade groups exhaled briefly on Tuesday, but his latest comments underscored Mr. Trump’s longstanding desire for broader duties and a new Feb. 1 deadline for 25% tariffs against Canada and Mexico, as well as duties on China and the EU.

Trump said the EU and other countries also had troubling trade surpluses with the United States.

“The European Union is very, very bad to us,” he said, repeating comments made Monday. “So they’re going to be in for tariffs. It’s the only way … you’re going to get fairness.”

Trump said on Monday that he was considering imposing the duties on Canada and Mexico unless they clamped down on the trafficking of illegal migrants and fentanyl, including precursor chemicals from China, across their US borders.

Mr. Trump had previously threatened a 10% duty on Chinese imports because of the trade, but realigned that with the Feb. 1 deadline.

White House trade adviser Peter Navarro told CNBC early on Tuesday that Trump’s Canada and Mexico tariff threat was to pressure the two countries to stop illegal migrants and illicit drugs from entering the US

“The reason why he’s considering 25, 25 and 10 (percent), or whatever it’s going to be, on Canada, Mexico and China, is because 300 Americans die every day” from fentanyl overdoses, Mr. Navarro said.

Trump on Monday announced a sweeping immigration crackdown, including a broad ban on asylum.

APRIL 1 REPORTS
Mr. Trump on Monday signed a broad trade memorandum ordering federal agencies to complete comprehensive reviews of a range of trade issues by April 1.

These include analyses of persistent US trade deficits, unfair trade practices and currency manipulation among partner countries, including China. Trump’s memo asked for recommendations on remedies, including a “global supplemental tariff,” and changes to the $800 de minimis duty-free exemption for low-value shipments often blamed for illicit imports of fentanyl precursor chemicals.

The reviews ordered create some breathing room to resolve reported disagreements among Trump’s cabinet nominees over how to approach his promises of universal tariffs and duties on Chinese goods of up to 60%.

Trump’s more measured approach to tariffs fueled a rally in US stocks that pushed the benchmark S&P500 index to its highest level in a month, though Trump’s new salvo on China and the European Union may deflate that momentum.

Trump likely “decided to go a little slower and also to make sure he has as firm a legal foundation as he can get for these kinds of actions,” said William Reinsch, a trade expert at the Center for Strategic and International Studies in Washington. “He’s figuring out how to best use his leverage to get what he wants.”

SOFTER TONES
Mexico and Canada struck conciliatory tones in response to Trump’s Feb. 1 deadline. Mexican President Claudia Sheinbaum said that she would emphasize Mexico’s sovereignty and independence and would respond to US actions “step by step.”

But she added that the US-Mexico-Canada free trade agreement was not up for renegotiation until 2026, a comment aimed at pre-empting suggestions that Trump will seek an early revamp of the pact that underpins over $1.8 trillion in annual three-way trade.

Corn farmers are worried about US tariffs and retaliatory duties disrupting trade with Mexico, their top export customer for corn, and with Canada, the top export customer for US corn-derived ethanol.

“We understand that he is a negotiating type of person,” Illinois farmer Kenny Hartman, Jr., board president of the National Corn Growers Association, said of Trump. “We’re just hoping that we can come out of this where we don’t lose the exports — we don’t lose that corn going to Mexico or that ethanol going to Canada.” — Reuters

Aiming to weaken US foes, Trump faces an ‘unholy alliance’

January 22, 2025 | 6:09 pm

WASHINGTON — During his first term in office, US President Donald Trump applied his particular brand of diplomacy with Washington’s adversaries, publicly befriending Russia and North Korea while separately piling pressure on China and Iran.

This time he faces a different kind of challenge: a more united group of US antagonists who have drawn closer following Russia’s 2022 invasion of Ukraine.

Trump, who took office Monday, has vowed to end Russia’s war in Ukraine, curb Iran’s nuclear program and counter China while building up the US military.

But in the past few years, Chinese President Xi Jinping and Russian President Vladimir Putin have forged a “no-limits partnership,” with Beijing giving Russia the economic support it needs to sustain its war in Ukraine.

On Tuesday, Mr. Putin and Mr. Xi proposed a further deepening of their strategic partnership during a long phone call after Mr. Trump was sworn in as US president.

Russia has also signed strategic pacts with North Korea in June 2024 and Iran on Friday.

The grouping of four US foes, which BMr. iden’s ambassador to China recently called an “unholy alliance,” adds up to a loss of leverage for the U.S. and its partners, say analysts.

“The dilemma for Trump, who has expressed a desire to ‘get along with Russia,’ and who is trying to squeeze China on trade, is that Moscow’s partnership with Beijing limits both Russian willingness to engage with Washington and Chinese vulnerability to U.S. pressure,” said Daniel Russel of the Washington-based Asia Society Policy Institute, who headed East Asia policy under former President Barack Obama.

Russia has weathered intense Western sanctions largely thanks to massive purchases of Russian oil by China and a supply of dual-use goods that the previous Biden administration said prop up the Russian defense industrial base, a charge China denies.

North Korea is supplying soldiers and weapons for Russia in Ukraine and has rapidly advanced its nuclear missile program. And experts fear Iran, though weakened by Israel’s assault on its regional proxies, could restart its effort to build a nuclear weapon.

Members of the new administration acknowledge the challenge.

“China is buying oil from Iran for pennies on the dollar, Iran is using that to send missiles and drones into Russia, that is then hitting Ukrainian critical infrastructure,” said Mike Waltz, the incoming national security advisor in a Fox News interview in November.

In his Senate confirmation hearing last week, Secretary of State Marco Rubio labeled China as the gravest threat facing the United States and accused Moscow, Tehran and Pyongyang of sowing “chaos and instability.”

PEELING ALLIES AWAY FROM CHINA
Zack Cooper, a senior fellow focused on Asia at the American Enterprise Institute, said he thinks Mr. Trump’s team “will try to peel countries away from China.”

“They seem to want to wedge Russia, North Korea and Iran away from China, which means differentiating these threats rather than implying that they are inter-related,” Mr. Cooper said. “So pushing for a deal with Pyongyang and another one with Moscow seems most likely to me.”

Dividing the partners will not be easy.

North Korea, for one, may have less incentive to engage directly with the United States, said Michael Froman, who served in Obama’s cabinet as the US trade representative and is now president of the Council on Foreign Relations think tank.

While Trump during his first term thought he could reach a deal with Pyongyang, Froman said it was unclear whether North Korea has an interest in engaging with the US now that it has broader support from Russia and China.

Trump held unprecedented summits with North Korean leader Kim Jong Un during his first term and touts their rapport. Trump’s team is again discussing pursuing direct talks with Mr. Kim.

Some cracks in the countries’ ties are starting to appear.

Former deputy US Ambassador to the United Nations under Biden, Robert Wood, questioned whether Tehran could rely on Moscow for help, citing the lack of Russian support for its ally, former Syrian President Bashar al-Assad, shortly before he was ousted.

“If I were Iran and I looked at how Russia abandoned Assad, I would be very concerned,” Mr. Wood said.

On Iran, Trump appears likely to return to the policy he pursued in his previous term that sought to wreck Iran’s economy to force the country to negotiate a deal on its nuclear program, ballistic missile program and regional activities.

Wood said all such efforts will be easier if the new administration focuses on strengthening U.S. alliances, a US asset that Trump downplayed during his first term in office.

“You try to divide them where you can,” he said, referring to China, Russia, Iran and North Korea. “It’s so critically important to have and be able to rely on the kind of alliances that we have, because the United States can’t take on all of these players by themselves.” — Reuters

S. Korea’s birthrate set to rise for the 1^st time in 9 years

January 22, 2025 | 6:07 pm

South Korea-children — Children in traditional costumes are seen in central Seoul, South Korea, March 1, 2019. — REUTERS

SEOUL — South Korea’s birthrate is set to show a rise in 2024 for the first time in nine years, following a rebound in marriages that were delayed due to the COVID-19 pandemic.

The Asian country has recorded the world’s lowest fertility rates, but the number of newborns between January 2024 and November 2024 rose 3% from a year earlier to 220,094, monthly government data showed on Wednesday.

In 2023, newborns fell by 7.7%, extending declines to an eighth consecutive year and resulting in an annual fertility rate of 0.72, the lowest globally.

The rise comes as marriages rose in 2023, marking the first increase in 12 years after couples had postponed weddings during the pandemic.

In the Asian country, there is a high correlation between marriages and births, with a time lag of one or two years, as marriage is often seen as a prerequisite to having children.

In a government survey last year, 62.8% of South Koreans opposed births outside marriage, though that was down from 77.5% seen a decade ago.

In neighboring China, the number of births rose 5.8% to 9.54 million in 2024, also boosted by delays in marriages due to the pandemic.

The number of marriages in South Korea in the January to November period jumped 13.5% to 199,903. That figure, unless there is a change in December, will mark the biggest annual increase since 1980.

Last year, South Korea rolled out various measures to encourage young people to get married and have children, after now impeached President Yoon Suk Yeol declared a “national demographic crisis” and a plan to create a new ministry devoted to tackling low birth rates.

Most of the measures consisted of financial support through tax cuts and subsidies, namely a one-time tax cut of 500,000 won ($349.35) per person for couples married between 2024 and 2026, though the government has said it will try to take a more comprehensive approach.

The annual data for 2024 is due to be released on Feb. 26. — Reuters

In Japan, wage growth gathers steam as retailers reluctantly raise pay

January 22, 2025 | 6:04 pm

Uniqlo-worker — A STAFF MEMBER works at the Uniqlo flagship store in Tokyo in this April 9, 2015 file photo. — REUTERS

TOKYO — Japan’s retailers, typically among the most tight-fisted of employers, are offering big pay increases for a second year in a row, meaning squeezed profits for companies, more spending money for workers, and a green light for more central bank rate hikes.

Japan’s labor-intensive service sector had long managed to avoid making big or sustained pay raises, by tapping a vast pool of part-time, lower-paid retirees and housewives.

But that began to change last year as a rapidly shrinking working-age population and rising inflation made it harder for retailers — who employ 10% of Japan’s workers — to attract and retain staff.

Their acquiescence to successive wage hikes, marking a breakthrough among low-wage service businesses and small manufacturers, has not escaped the notice of policymakers, including central bankers keen for signs that wage growth is taking hold after 25 years of stagnation.

“There was a lot of positive talk on the wage outlook,” Bank of Japan (BoJ) Governor Kazuo Ueda said at a gathering of regional bank executives last week, referencing a meeting of BoJ branch managers the week before.

The central bank has predicated its latest cycle of interest rate hikes, including another expected at a policy meeting later this week, on a sustained “virtuous circle” of higher wages that support higher prices, for services as well as for manufactured goods.

UA Zensen, a group representing retail, restaurant, textile and other industry unions, is seeking wage hikes of 6% for full-time workers and 7% for part-timers for 2025, outpacing the baseline 5% target set by Rengo, the nation’s largest union.

Talks over 2025 wage levels typically conclude around March, and go into effect up to a few months afterwards.

“Solid wage hikes will help put the Japanese economy on a growth track,” said Tamon Nishio, UA Zensen’s general secretary.

“Many of our union members are from small and medium-sized firms and are part-time workers. We want wage hike momentum to spread broadly to our members to achieve real wage growth and create a positive cycle for the economy.”

Economists and executives, however, point to a number of doubts and potential downsides with this momentum, including rising costs for retailers and uncertainty whether workers would be willing to spend their windfall.

“The big pay hikes will boost our cost burden,” Takaharu Iwasaki, president of Japan’s largest food supermarket chain Life Corp., told reporters.

“But with competition to hire and retain workers intensifying, we want to reward them with solid pay.”

The company is targeting wage hikes in 2025 similar to the previous year’s 5% for regular employees and 6% for part-timers.

Retail conglomerate Aeon 8267.T is also considering raising hourly pay for the group’s 420,000 part-timers by 7%, the same pace as last year.

“We want to continue raising pay mainly for part-timers as we did last year and the year before,” Executive Officer Motoyuki Shikata said on an earnings call on Jan. 10.

“We’re hearing from field managers that pay hikes over the last two years have helped hire workers.”

DOUBTS AND DOWNSIDES
These wage increases are beginning to make themselves felt in retailers’ bottom line.

At Life, labor costs rose 7.9% and net profit fell 3.4% in the nine months through November. Aeon slipped into a net loss in the same nine-month period, with wage hikes increasing its labor costs by 42.7 billion yen ($270.6 million).

The retailers have had little choice, as Japan’s working-age population continues to shrink from its peak of 86 million marked in 1995. A government think tank projects the population between the ages of 15 and 64 will drop about 20%, to 62 million, in the two decades through 2040. The pool of potential part-time female and older workers is also shrinking.

Additionally, there are doubts as to whether wage increases would translate into higher spending, especially with inflation tending to outpace wage growth. Without higher spending, companies would find it difficult to raise prices.

“Retailers are raising wages to retain workers, but it’s questionable whether they can keep doing so beyond this year,” said Shinichiro Kobayashi, principal economist at Mitsubishi UFJ Research and Consulting.

“Consumers did accept a certain degree of post-pandemic price hikes at retailers. But there are emerging signs they are getting tired of unabated price rises and shifting to discount stores for shopping,” he said.

Indeed, workers do not appear to be in a spending mood.

“Our cost-saving mindset is so strong, I don’t think higher pay would change people’s spending pattern that much,” said Miwako, a part-time worker at a major supermarket chain in Tokyo who asked to be identified only by her first name.

She said that, while she is hopeful her pay will keep rising, she would plan to save any pay raise rather than spend it. — Reuters