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Can ukay-ukay save the planet?

EVERY outfit tells a story, but are you sure you’re telling the right one? In the years to come, will your choices today place you on the right side of history? The choice you made will still be evident years from now, when that shirt you bought on impulse will still sit in a landfill, intact when you won’t be. A movement called FashionRevolution, starting in the UK and finding roots in the Philippines, rises from the simple question, “Who made my clothes?”

The question is important to the organization: Fashion Revolution began as a response to the 2013 Rana Plaza collapse, where a commercial building housing sweatshops in Bangladesh collapsed, killing 1,134 people. It was then revealed that many of the factories in the building were making clothes for several brands in fast fashion, solid evidence of the problems the convoluted supply chain of the fashion industry creates.

The organization has held Fashion Revolution Week worldwide, extended from a day of commemoration held every year on April 24, the day Rana Plaza collapsed. “Not many people know that there are a lot of social and environmental issues in the fashion industry,” said Sophia Calugay, country coordinator for Fashion Revolution Philippines, during a press conference. Among these issues are human trafficking (through modern-day wage slavery), and pollution caused by factory operations. “We love fashion but we don’t want our clothes to come at the cost of our people and our planet. We believe in a fashion industry that values the people, the environment, creativity, and profit — in equal measure,” she said.

During the talk, Fashion Revolution presented research they conducted about what they see as a solution to some of the fashion industry’s issues: used clothing, locally called ukay-ukay. The research extols the ability of used clothing to recirculate resources and delay the appearance of textiles in landfills. However, the same research says that the used clothing industry in the country is technically illegal: it breaks Republic Act No. 4653, which bans the importation of used clothing and “rags,” to “safeguard the health of the people and maintain the dignity of the nation.”

Fashion Revolution’s research reveals that misdeclaration of goods, redirection of relief goods, and gifts from abroad enable the trade, thanks to widespread corruption in the Bureau of Customs. For instance, the research says that a common way to enforce the law is to confiscate and destroy only a fraction of the secondhand clothes: the rest are set free in exchange for a bribe.

Ms. Calugay, said that after the clothes enter the country, their resale is considered a gray area, legally and morally, considering that several businesses are legally registered as secondhand clothing stores. A solution posed by the organization is to revise the law, conduct impact assessments, and restrict secondhand stores only to some parts of the Philippines, the better to control the influx of imported secondhand clothes, the sheer volume of which, in the dozens of tons, can rival the shipments of fresh clothing from fast fashion brands.

Ms. Calugay also pointed to changing consumer patterns especially in developing countries that contribute to the problems posed by the growing fashion industry. “You have a soaring middle class population [who buy] a lot of clothes. You want to address that population.”

Ms. Calugay gives several solutions to reduce consumption in fashion: there’s thrifting, buying local (to reduce the carbon footprints in buying imported clothing), swapping (Ms. Calugaypointed to a silk skirt she and her mother swapped), and repairing clothes that are already in one’s closet.

“Just fall back in love with the clothes you already have,”she said.

Fashion in the age of climate and social change has to transform from an exclusionary exercise in economic ability, to a show of moral responsibility for the planet and its people. “We want consumers to buy less, and buy with quality.

“If you need it today, are you going to wear it again tomorrow?” — Joseph L. Garcia


Ukay-ukay shopping tips

ON an excursion to secondhand shops or ukay-ukay in Makati Cinema Square and Guadalupe Nuevo in Makati, Sophia Calugay, country coordinator for Fashion Revolution Philippines, pointed out the various branded outfits she spotted, along with real Dr. Martens boots, and gave a few tips.

• Check for holes and stains to make sure you’re getting your money’s worth.

• Wear a mask, for some of the clothes have been taken fresh out of containers and boxes, unwashed, and might trigger allergies.

• Sanitize purchases by running them under hot water, and then thoroughly handwashing them (machine washing might damage the fabric beyond repair).

While there are sustainability benefits from thrift-shopping, of course there’s an an emotional benefit too: there’s the thrill in finding treasures, but also, “It’s quite fun to do it with friends,” said Ms. Calugay.

Limketkai, 72, leaves legacy of his visions in Cagayan de Oro

CAGAYAN DE ORO City tycoon Lorenzo U. Limketkai passed away at age 72 and he will be laid to rest Monday, May 6, in his hometown.

Mindanao Business Council Chair Vicente T. Lao described Mr. Limketkai as a pioneering entrepreneur who helped in the growth of the southern island.

“He was a good Mindanao businessman and a visionary,” Mr. Lao said in a mobile text message to BusinessWorld.

Mr. Limketkai was considered a driving force in the growth of the family enterprise, which was started by his parents in 1927 as a rice and corn mill and later grew into the large-scale manufacture of corn oil and other food products under Limketkai Manufacturing Corp.

The Limketkai name is also well-known in Cagayan de Oro City for their over 40-hectare mixed-use complex, considered one of the first and biggest leisure centers in Mindanao, that houses retail shops and supermarkets, the Limketkai Luxe Hotel, other entertainment facilities, and a 4,500-capacity convention hall.

“We mourn the untimely demise of another great economic pillar of Mindanao. I had the opportunity to have met him when I was chair of the Mindanao Business Council. He shared his vision of transforming Cagayan to become one of the top economic hubs of Mindanao. So with courage and his vision. The biggest and 1st shopping mall of CDO was born,” said Davao City-based business leader Joji Ilagan-Bian, also currently the honorary consul general of Bangladesh.

The Limketkai Center was developed and managed by Limketkai Sons, Inc.

“He will always be remembered by the younger business leaders as a person with sharp vision and tenacity to make things move at great speed,” Ms. Bian said. — with a report from Carmelito Q. Francisco

Yields on T-bills likely to decline

RATES OF Treasury bills (T-bill) on offer today are expected to decline across all tenors, as market participants price in the recent sovereign debt rating upgrade of the Philippines and gear up for the slew of domestic data to be released this week.

The Bureau of the Treasury (BTr) is offering P15 billion worth of Treasury bills (T-bill) today, broken down into P4 billion and P5 billion in three- and six-month papers, respectively, and P6 billion in one-year securities.

Traders interviewed before the weekend said yields on the T-bills to be auctioned off Monday will likely be flat or decline by five basis points (bp) across all tenors from the previous offer.

Last week, the BTr partially awarded the T-bills it placed on the auction block, borrowing just P13.01 billion out of P29.257 billion in total bids and the P15 billion it wanted to secure.

Broken down, the Treasury borrowed P4 billion as planned via the 92-day tenor as tenders reached P9.85 billion. The average rate declined 4.5 bps to 5.563%.

The government also made a full award of the 183-day T-bills, accepting the programmed amount of P5 billion, with total offers amounting to P10.947 billion. The tenor’s average yield slipped 1.8 bps to 5.978%.

Meanwhile, for the 365-day T-bills, the government borrowed just P4.01 billion out of the P6 billion it wanted to raise, even with tenders totalling P8.46 billion. The average yield on the papers picked up 3.3 bps to 6.085%.

At the secondary market on Friday, the three-month, six-month and one-year papers were quoted at 5.693%, 5.942% and 6.064%, respectively, based on the PHP Bloomberg Valuation Service Reference Rates.

Robinsons Bank Corp. trader Kevin S. Palma said demand for the T-bills on offer today will likely “still possibly skewed on the shorter dates” following the credit rating upgrade of the country.

S&P Global Ratings last week raised the country’s long-term credit rating to “BBB+” from “BBB,” just a notch away from the “A” level.

“So far, the market already rallied. The market is now pricing in the recent upgrade,” another trader said.

Both traders added that market participants will also position ahead of a data-rich week.

“April inflation and first quarter GDP (gross domestic product) growth data will be released just in time to set the stage for the much anticipated Monetary Board meeting on May 9,” Mr. Palma said.

Inflation likely eased further eased for the sixth straight month in April on the back of a decline in rice prices. A BusinessWorld poll of 10 economists yielded a 3.1% median estimate for last month, which if realized will be slower than the 3.3% rate the previous month.

According to a separate poll, the country’s first-quarter GDP growth is expected to be at 6.1%, easing from the 6.3% expansion the previous quarter and 6.5% in the first three months of 2018, taking into account the impact of the four-month delay in the enactment of the national budget.

Meanwhile, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno sees room to ease monetary policy at its review on Thursday, as the recent credit rating upgrade is “another factor” to “move faster.”

“Local bond yields have trended lower after the S&P announcement, so the market may have already priced in the upgrade. But we may see this rally grow legs after BSP Governor Diokno’s pronouncements that the S&P upgrade could hasten monetary policy easing,” Mr. Palma added.

The government plans to borrow P315 billion from the domestic market this quarter, broken down into P195 billion in T-bills and P120 billion in Treasury bonds.

It is looking to borrow P1.189 trillion this year from local and foreign sources to fund its budget deficit, which is expected to widen to as much as 3.2% of the country’s gross domestic product. — Karl Angelo N. Vidal

Palay prices remain under pressure in mid-April

THE farmgate price of palay, or unmilled rice, continued to decline during the middle weeks of April, with domestic prices still under pressure amid expectations of more liberal imports of cheap rice, even as the government concentrates all its procurement efforts on domestic rice.

According to the Philippine Statistics Authority, the average farmgate price of palay in second week of April fell 0.32% week-on-week to P18.64 per kilogram (kg). In the third week, the corresponding decline was 1.12% to P18.48/kg.

The average wholesale price of well-milled rice fell 0.37% week-on-week to P40.01 during the second week of April, and fell by a further 0.25% to P39.91 during the third week.

At retail, the average price of well-milled rice fell 0.18% week-on-week to P43.79, and fell by a further 0.25% to P43.68 during the third week.

Agriculture Secretary Emmanuel F. Piñol said that his department cannot arrest the price drop because of the deregulation of imports. “Wala na kaming [We do not have] control… that’s why we are strengthening the NFA (National Food Authority),” he told reporters.

Under the Rice Tariffication Law, the NFA has shifted its focus to palay procurement from domestic producers in order to maintain a buffer stock for calamities and emergencies.

He also noted that “As of the moment, stable na stable ‘yung supply ng bigas [the rice supply is very stable]. There is no danger that there will be a spike.”

He added that the last shipments of rice imported by the NFA are still good for five months, which means that such stocks of lower-cost rice are not yet competing in the market during the domestic harvest.

As of April 15, the NFA has breached the two-million bag level for palay procurement. It has procured 2.12 million 50-kilo bags since January, with 845,891 bags bought in April. The procurement target is 350,000 metric tons (MT) of domestic palay.

Meanwhile, the NFA has assured that it is only buying palay from legitimate farmers amid allegations that the agency is buying from fake cooperatives used by traders to sell to the agency at a higher price. Generally, a passbook is needed to be able to sell to the agency.

“First of all, farmers need to secure a passbook from NFA before they can sell to the agency. Requirements for securing this passbook include a filled out Farmer’s Information Sheet with identification picture, and certification from the Barangay Captain, Municipal Agriculturist, Municipal Agrarian Officer or National Irrigation Administration where his farm is located,” NFA Officer-in-Charge Administrator Tomas R. Escarez said in a statement on Sunday.

Farmer organizations must secure a master passbook by submitting their certificate of registration, assembly resolution, and masterlist of members. In cases when a walk-in farmer would want to sell, he can do so up to 200 bags only for the first time. He will then fill out a farmer’s information sheet, so that future transactions will be recorded in a passbook.

The PSA also noted that the average farmgate price of yellow corngrain fell 0.07% week-on-week to P14.06/kg during the second week of April, and fell 0.07% during the third week to P14.05/kg.

The average farmgate price of white corngrain during the second week of April fell 0.44% week-on-week to P15.89. In the third week the average price rose 1.51% to P16.13/kg.

The average wholesale price of yellow corngrain was unchanged at P20.21 during the second week, but rose 0.25% week-on-week to P20.26 in the third week.

At retail, the average price fell 0.08% week-on-week to P24.79 during the second week, but rose 0.56% week-on-week to P24.93/kg during the third week.

The average wholesale price of white corngrain in the second week fell 1.39% week-on-week to P22.73, and fell further in the third week by 0.44% to P22.63.

The average retail price fell 0.88% week-on-week to P29.12 in the second week, and was unchanged in the third week. — Vincent Mariel P. Galang

BWORLD TEST: Toyota Fortuner TRD Sportivo

Text and photos by Ulysses Ang

THIS MUCH is obvious: midsize 7-seat SUVs have become today’s family car. Aside from a seating configuration that allows the entire caboodle to hit the mall in style, they’re tall (read: flood-proof), durable, and most importantly, powered by a thrifty diesel engine.

Naturally, not one SUV could have it all. Or could it? Say hello to the Toyota Fortuner TRD Sportivo — a big family-friendly daily driver with a dose of sportiness.

From the outside, the Fortuner is all swoopy and sleek. It may have hit the scene three years ago, but it’s fresh and head-turning. It makes the previous model (and some of its rivals) look old. On top of that, Toyota recently introduced this new TRD variant. Based on the 2.4 G, it nets you a White Pearl shade (the most affordable variant that actually gets this color) along with a new grille, bumpers, wheels, rear spoiler, and of course, the usual stickers and badging.

Now, Toyota may have done most, if not, all of the Fortuner TRD’s upgrades outside, but it doesn’t mean that the cabin’s a bad place to be in. On the contrary, it’s surprisingly solid, modern-looking, and well-made. There are still some hard plastics present (particularly on the upper dash), but at least, Toyota’s managed to integrate a few luxury cues as well. From using the right shade of colors for the interior (a combination of black and dark brown) to the application of matte wood and blue lighting, the overall look and feel of the Fortuner’s been uplifted.

The Fortuner offers a sliding second row that divides knee room across rows two and three, but the swoopy roofline also robs some usable headroom in those two areas. The side-folding third row, a throwback to traditional SUV design, may offer better bolstering and back support for occupants, but it can be a pain to fold them up when not in use. It also takes away some of the usable cargo room too.

It’s equally a pain to fold them when not in use. This configuration means proper seating in the third row (it’s not knees up), but it also takes away some of the usable cargo room which is down 35 liters versus the Isuzu mu-X with the third row up.

For day to day driving, the Fortuner TRD Sportivo feels peppy. At these speeds, the Fortuner’s 2.4-liter 2GD-FTV is quiet and smooth. It’s remarkably civil with just a hint of diesel clatter at the top end. It can gobble up 100 km/h without you having to thrash the accelerator.

Likewise, the 6-speed automatic is a good match to the engine. It commits to a gear and doesn’t hunt as much.

The traditional hydraulic power-assist steering feels hefty, contributing to a less than agile feel especially when doing low-speed maneuvers or parking. However, equipped with four-wheel disc brakes, it does the job of stopping this close-to two-ton SUV. When it comes to the all-important ride, the Fortuner still doesn’t like small, undulating surfaces such as badly-patched roads or road cracks, but as roads turn to trails, it absorbs them way better. Plus, it’s got good highway stability with a flat, smooth ride.

People flock to the Fortuner because it’s still unquestionably the reliable, durable, and practical choice. Sure enough, get one and no one would question this choice; it’s a safe bet. That said, the addition of the TRD Sportivo variant at least adds a dose of sportiness to a midsize SUV that’s already pleasingly modern. It may not have the most luxury amenities (that’s what the V variants are for), but for those who want that added dose of sportiness to go with their practical family car, this one’s worthy of consideration.

Based on the Fortuner 2.4 G variant, the TRD Sportivo nets you a White Pearl shade (the most affordable variant that actually gets this color) along with a new grille, bumpers, wheels, rear spoiler, and of course, the usual stickers and badging.

Designer Resty Lagare returns to Butuan

A NUMBER of Filipino fashion designers have made it big beyond the country’s shores: among the best known are Michael Cinco, Francis Libiran, Rocky Gathercole, and Lesley Mobo.

While also made a name in the international scene, Resty Lagare is relatively unknown to Filipinos.

He is currently the resident fashion designer of Lovely Fashion, one of the biggest haute couture stores in Kuwait. He has dressed up celebrities for the Academy Awards and the Grammy Awards, and his creations have been showcased in New York Fashion Week, LA Fashion Week, Phoenix Fashion Week, and the TV show Germany’s Next Top Models, among others.

A native of Butuan City, he left in 1991 to pursue his dream to become a designer and he is coming back to give back via a charity fashion show in his home town.

“I vividly remember that I was on the boat from Nasipit and then I looked at Butuan to bid goodbye. I told myself that I will come back one day when Butuan can be proud of me,” he was quoted as saying in a press release.

A high school graduate from the Father Saturnino Urios University in Butuan, he dropped out of college to work for a garment factory in Manila before going to Dubai.

The Resty Lagare Charity Fashion Show will be held on May 20 at the LMX Convention Center in Butuan. It is produced by Butuan-based social enterprise One Closet and all the Rotary Clubs of Butuan (Rotary Club Area 3I and 3J).

Isabela Blancas, the 15-year-old founder of One Closet, was quoted as saying in the press release, “It was not difficult to convince Tito Resty to come home. He agreed to return on the condition that we put up a charity fashion show.”

The event aims to raise funds for two shelters for disadvantaged children, namely the Gesu Eucaristico Children’s, Inc. for abused girls in Buenavista, Agusan del Norte which is run by the Sisters Disciples of Jesus in the Eucharist; and Balay Silonganan, a home for abandoned and neglected children in Barangay Pinamangkulan in Butuan which is run by the Missionary Sisters of Our Lady of Fatima.

All of the event’s profits will go to the beneficiaries.

“I’m very excited about the show because we are helping marginalized kids who are close to my heart,” Mr. Lagaren was quoted as saying. “My parents worked hard selling fish in the market to provide for our family. I felt that I was so blessed. My heart goes out to kids who were abandoned or abused.”

Aside from Mr. Lagare, local fashion designers Dannah Mae Paclibar, Edzel Macion, King Aranchado, Kim Amora, and Johnbert Hubabib will be showing their creations in the charity event.

“With this event we get to show the creativity of Butuan’s fashion industry to attract both clients and investors,” said Mr. Lagaren. “I, myself, is looking for investment opportunities to help my fellow Butuanons.

“My first show in the Philippines has to be in Butuan. I’m glad that generous organizations and individuals are helping us with the show.”

For tickets and sponsorships, contact Frederick Blancas at 0917-863-2070.

PhilRealty profit jumps 48% in 2018

PHILIPPINE Realty & Holdings Corp. reported its net income grew by 48% in 2018, on strong sales of its projects in Quezon City and Bonifacio Global City, as well as higher valuation of its assets.

In a regulatory filing, the listed property developer said its net income attributable to the parent company stood at P392.63 million in 2018, from P264.36 million in the previous year.

“The improved valuation of our investment properties as well as the sustained increases in our real estate and rental businesses led to our bottomline leap,” PhilRealty President and Chief Executive Officer Alfredo S. del Rosario, Jr. said in a separate statement.

PhilRealty said property sales jumped by 28% to P1.009 billion, driven by demand for properties such as SkyVillas and Skyline in Balete Drive, Quezon City, and Icon Plaza in Bonifacio Global City (BGC), Taguig.

Rental income also rose by 117% to P102 million on the company’s expansion of leasable spaces and new lease agreements.

Other income also increased by 84% to P662 million on the re-valuation of investment properties, such as commercial, office and storage condominium for lease and parking spaces for lease at Philippine Stock Exchange Center (Tektite Towers) in Ortigas Center and the Icon Plaza.

Recently, PhilRealty closed the 20-year-old legal case with Universal Leisure Corp. (ULC) which involved a 2,370 square meter (sq.m.) penthouse unit and 74 parking lots in Tektite Towers. RLT paid P231 million that allowed it to re-acquire the properties. The company started buying Tektite units back in May 2017 when it acquired the units owned by the Philippine Stock Exchange totaling 4,492.22 sq.m.

For this year, PhilRealty said it is looking at doubling its authorized capital stock to 16 billion common shares. The new shares will be issues to Greenhills Properties, Inc., which will be intended for two lots in BGC where a high-end residential condominium project will be constructed. — V.M.P.Galang

Climate change leads US fund managers to adjust investments in agriculture

NEW YORK — After historic floods devastated Midwestern agricultural states this spring, some fund managers are evaluating how climate change will affect the long-term value of companies that make or sell products ranging from tractors to fertilizer.

The issue is not simply the unpredictability of weather. Instead, fund managers say, they are struggling to model how extreme weather events from droughts to more powerful storms will affect commodity prices and, in turn, spending by farmers on equipment or seeds.

In November, the US government published a report that found climate change will boost costs in industries including farming and energy production by increasing the frequency and severity of storms. The US-China trade war has also clouded the outlook for US farmers.

Early estimates of crop and livestock losses from this year’s floods are approaching $1 billion in Nebraska alone, and damages are expected to climb much higher for the region. The US Department of Agriculture, meanwhile, has no way to compensate farmers for crops that were damaged when floods overtook their record-high stockpiles of grain.

“I just don’t know how to value these companies now,” said Christopher Terry, a portfolio manager at Hodges Capital in Dallas. “It’s harder to invest around a theme when you’re talking multi-decade impacts.”

More extreme weather in the Midwest, for instance, will boost the cost of grains for feed, which will cut margins of egg producers like Cal-Maine Foods Inc, he noted. Barge companies such as Kirby Corp that move commodities down the Mississippi River may have more days that operations are out of service because of flooding, he added.

Other fund managers said they were seeking agricultural companies that might actually benefit from more severe weather.

Michael Underhill, chief investment officer at Capital Innovations, said he is focusing on midstream companies such as grains merchant Archer Daniels Midland Co and production companies like equipment maker Deere & Co that may benefit from greater volatility in commodity prices. ADM has a proven track record of hedging commodity bets, he said, while Deere may benefit if higher crop prices following extreme weather prompt farmers to invest in new machinery.

“If you think the next 10 years will look like the last 10 years you are in a for a rude awakening,” he said.

LOOKING FOR WINNERS
Incorporating the impact of climate change on agricultural stock valuations is something Wall Street analysts from firms including William Blair, Wedbush and R.W. Baird have largely avoided because it is hard to predict the impact on any one quarter or season. Analysts at these firms follow companies ranging from Bayer AG to retailer Tractor Supply Co.

“If weather conditions continue to have a more unforeseeable impact on agro business the best way to model this would be … to increase the beta-factor within the discounted cash flow model used by me. And no, I have not yet done so,” said Ulrich Huwald, an analyst who covers Bayer.

Private research companies like Four Twenty Seven have stepped into that void by providing quarterly climate risk scores for specific companies that focus on the impact of climate change events ranging from wild fires to rising sea levels on supply chains, operations, and trading markets.

Lucas White, a portfolio manager at GMO, runs one of the few actively managed mutual funds that target companies that may be significantly affected by climate change. While his fund has outsized positions in solar companies such as SolarEdge Technologies Inc and First Solar Inc, he also focuses on potash and phosphate producers that may see increasing demand as more severe storms wash away soil nutrients.

“Nobody knows what will happen with commodity prices and it’s more or less impossible to predict,” he said. “But farmers spend all this time getting their soil to be very productive and all of a sudden a huge downpour comes and they have to start from scratch again. It’s very difficult to produce agriculture in a world that is increasingly impacted by climate change.” — Reuters

Upgrade spurs bond rally

Yields on government securities fell across the board last week following a boost from the rating upgrade announced by S&P Global Ratings last Tuesday.

On average, debt yields — which move opposite to prices — went down by 8.7 basis points (bp) week on week, the PHP Bloomberg Valuation Service Reference Rates as of May 3 published on the Philippine Dealing System’s website showed.

“The biggest catalyst that led to the easing in local interest rate benchmarks [last] week has been the surprise upgrade on the Philippine credit ratings by S&P…[which] has fundamentally reduced risk premium and resulted in lower local interest rate benchmarks (PHP BVAL yields) thereby increasing the odds of monetary easing,” Rizal Commercial Banking Corp. economist Michael L. Ricafort said in an email.

“Furthermore, the said S&P upgrade will be positive for the broader economy and for the local financial markets…due to the country’s increased attractiveness for more inflows of foreign portfolio investments and foreign direct investments in view of the country’s improved credit ratings that expanded the roster of international funds that may be allowed to invest in the country, going forward,” Mr. Ricafort added.

S&P raised the Philippines’ long-term sovereign credit rating to “BBB+” from “BBB” last Tuesday — just a step away from single “A” tier — citing the country’s strong economic growth trajectory supported by solid government fiscal accounts, low public indebtedness and the economy’s sound external settings.

The rating was also assigned a “stable” outlook, indicating the country is likely to maintain the grade in the next six months to two years as the economy is expected to remain strong over the medium term.

The debt watcher’s latest rating action puts its assessment of the Philippines a step higher than those of its peers. Fitch Ratings and Moody’s Investors Service affirmed their “BBB” and “Baa2” ratings — a notch above the minimum investment grade — on the country in December and July last year, respectively, with corresponding “stable” outlooks.

Contributing to the easing in local interest rate benchmarks, Mr. Ricafort said, may have also been the easing in money supply growth and demand for loans, which “may also somewhat increase” the possibility of a cut in the large banks’ reserve requirement ratio (RRR) and key policy rates amid a continuous easing trend in inflation.

Domestic liquidity or M3, considered as the broadest measure of money in an economy, grew 4.2% year-on-year to about P11.4 trillion in March, slower than the 7.1% expansion in February and 7.6% growth in January. This pace is the slowest recorded since September 2012.

Meanwhile, outstanding loans increased by 9.9% year-on-year in March, slower than the 13.7% pace logged the previous month. Inclusive of reserve repurchase agreements, bank lending growth decelerated to 9.3% from 13.9% in February.

At the secondary market on Friday, all bond tenors rallied. At the short end, the 91-, 182- and 364-day Treasury bills (T-bill) went down by 3.9 bps, 2.2 bps, and 4.1 bps to yield 5.693%, 5.942%, and 6.064%, respectively.

At the belly of the curve, the rates of the two-, three-, four-, five-, and seven-year Treasury bonds (T-bond) lost 6.2 bps (5.899%), 6.3 bps (5.849%), 7.9 bps (5.813%), 10.1 bps (5.789%), and 13.7 bps (5.779%).

Meanwhile, at the long end, the 10-year T-bond saw its rate go down by 16 bps to 5.805%. Likewise, the 20- and 25-year tenors also went down by 8.5 bps and 16.8 bps, yielding 5.981% and 6.099%, respectively.

For this week, Mr. Ricafort said debt yields could “continue their easing trend” as latest inflation data to be released tomorrow is expected to slow further to below 3%.

Likewise, he noted the policy review by the Bangko Sentral ng Pilipinas’ Monetary Board on Thursday, during which he expects key policy rates to be cut by at least 25 bps and/or big banks’ RRR to be slashed by at least 1 percentage point from the current 18%.

“Benchmark government bond yields in developed countries mostly hovered among the lowest levels in 2-3 years recently… Thus, the search for higher yields/returns by international investors/fund managers in emerging markets such as the Philippines — especially after the country’s latest credit rating upgrade — could still lead to further easing in local interest rate benchmarks…amid easing trend in inflation as well,” Mr. Ricafort added. — MAM

Subaru offers special summer deal for the 3.6 Outback

MOTOR IMAGE Pilipinas, Inc., the exclusive distributor of Subaru vehicles in the Philippines, draws up an irresistible offer for the P2,408,000 Subaru Outback 3.6 R-S with EyeSight, available only this month of May.

Fully equipped with Subaru’s signature Symmetrical All Wheel Drive, Boxer Engine, EyeSight Driver Assist Technology and all the top of the line features, Subaru’s most refined SUV yet is yours to take either through:

Option 1 — P250,000 cash discount (with Blue Voucher worth P50,000 for service maintenance, paint protection, car care services, fuel, and Subaru merchandise), or

Option 2 — Rare low down payment + zero interest combination (20 percent down payment at zero-percent interest for 36 months with free LTO, CMF and insurance).

Experience all-terrain, uncommon luxury with the Subaru Outback by booking a test drive today. Know more by visiting your nearest Subaru Showroom and avail of this exclusive deal available only until May 31.

Rustan’ launches online shopping site

LUXURY retailer Rustan’s officially launched its e-commerce store, rustans.com, over the weekend with founder Ambassador Bienvenido Tantoco, Sr. placing the historic first online order.

Rustan’s has made a name for itself as a luxury retail destination since it was founded in 1952 and the retailer has been actively moving into the digital age for several years.

The new online store gives customers across the Philippines access to over 100 brands including beauty, fashion, home, and kids brands. Among the international brands on the site are Acca Kappa, Bobbi Brown, Clarins, MAC, Hackett, John Hardy, Le Sportsac, L’Occitane, La Mer, Gefu, Mustela, Nike, Seafolly, Stila, Swarovski, Little Tikes, and Royal Albert. More will be rolling out over coming months, including Diptyque and Mont Blanc. Also in the selection are Rustan’s private labels including Portuguese designer Ricardo Preto, Lady Rustan, and Lotus Resortwear.

“With this move to become more active in the digital space, we expect to better serve the evolving needs of our existing customers, as well as attract new customers,” Rustan’s chairperson and CEO Zenaida R. Tantoco was quoted as saying in a press release.

The online store includes informative content about every product, articles from the online ICONIC Magazine, and integrated online customer service and live chat options, and swift delivery services.

The store offers nationwide delivery or Click and Collect at Makati. Plus, free shipping is offered for orders over P5,000. Customers can sign up to receive alerts on special offers, upcoming sales, features and events through e-mail and social media. New sign-ups to the newsletter at rustans.com will recieve a discount for a limited time.

With security and privacy in mind, rustans.com has PCI Level 1 certification, guaranteeing encrypted and tightly protected data at all times. The store accepts credit cards and Paypal.

DoTr still wants private firm to take over MRT-3

THE Department of Transportation (DoTr) said it will continue to seek a private company to take over the operations and maintenance (O&M) of the Metro Rail Transit Line 3 (MRT-3), once the new Japanese contractors finish the rehabilitation of the railway system in two years.

“Long-term and multi-phased ’yung strategy natin for MRT-3.… Phase 3 natin ’yung longer-term natin na operations and maintenance. Meron tayong ongoing review ng unsolicited proposal for the operations and maintenance of MRT-3 [Our strategy for the MRT-3 is long-term and multi-phased…. Phase 3 is the longer-term operations and maintenance of the MRT-3. We have an ongoing review of an unsolicited proposal for this],” Transportation Undersecretary for Railways Timothy John R. Batan told reporters last week.

Last Tuesday, the government officially turned over the rehabilitation and maintenance works of the MRT-3 to Japanese firms Sumitomo Corp. and Mitsubishi Heavy Industries, Ltd. (Sumitomo-MHI) together with TES Philippines, Inc. (TESP).

Mr. Batan said this project is only Phase 2 of the government’s planned approach to improve the MRT-3 system. The last phase would be the entry of a private firm to handle the train line’s O&M — similar to what was done in the Light Rail Transit Line 1 (LRT-1) which is handled by Light Rail Manila Corp. (LRMC).

“The hybrid policy calls for us getting the private sector to operate our existing lines, operate and maintain, and it’s just consistent with that,” he said.

In 2017, a group composed of Metro Pacific Investments Corp. (MPIC), Ayala Group and Macquarie Infrastructure Holdings (Philippines) Pte. Ltd. was given original proponent status (OPS) for its O&M proposal for the MRT-3. The three firms had formed LRMC to operate and maintain LRT-1.

Mr. Batan noted the unsolicited proposal of MPIC is still “ongoing review” at the moment.

“Meron lang kasi tayong some legal issues na nire-resolve. As you may know, meron tayong ongoing arbitration for MRT-3, and part ’yan ng mga considerations natin in the timing of the different phases [We just have some legal issues to resolve. As you may know, we have an ongoing arbitration for MRT-3, and that’s part of our considerations in the timing of the different phases],” he said.

In 2009, MRT-3 contractor Metro Rail Transit Corp. (MRTC) filed an arbitration case in Singapore alleging the Philippine government of delayed equity rental payments in its signed agreement.

MPIC has control in MRTC through a cooperation agreement signed in 2010.

Mr. Batan noted the review of MPIC’s unsolicited proposal is moving forward in parallel with the settlement of the arbitration case.

MPIC President and Chief Executive Officer Jose Ma. K. Lim said in January the company may need to “reconfigure” its MRT-3 proposal following the entry of the Japanese firms. In February, MPIC Chairman Manuel V. Pangilinan said it may be best to “just wait word from the government.”

MPIC is one of three key 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 a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Denise A. Valdez