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Breaking our plastics habit is easier said than done

NAJA BERTOLT JENSEN-UNSPLASH

COULD our unshakeable addiction to plastics be broken?

That’s certainly the hope of activists.

The US — birthplace of the modern polymers industry, and the biggest producer of its key feedstocks, oil and gas — has joined a bloc supporting a worldwide treaty capping plastics production. That could make a United Nations meeting in South Korea in November into a turning point in the material culture of humanity. The harder challenge will be ensuring that an agreement is workable.

Whichever way you look at it, a mountain of waste polymers is likely to be one of the most lasting monuments of the 21st century. We produce some 400 million metric tons of plastics year in, year out. Except for the roughly 9% that’s recycled and 12% that’s incinerated, all of it ends up somewhere in the environment, whether in a landfill or scattered through our streets, soil, and oceans. Do everything feasible to stop that runaway train and we might cut output by about 40% by 2040, according to one influential study. Even such an ambitious scenario would leave more than 10 billion tons of waste by mid-century. How you feel about that depends on how you weigh the contradictory evidence about the costs and benefits of plastics. It’s not enough to point at a large number and worry about it: Each year we manufacture four billion tons of cement, two billion tons of steel, pump 4.5 billion tons of oil from the ground, and release 35 billion tons of carbon dioxide into the atmosphere. Whether you consider that a problem depends on whether you think the waste is damaging (like CO2) or largely harmless, like concrete.

Plastics, furthermore, have real advantages over the alternatives. They’re light, largely inert, and in many cases do less environmental damage than metal and glass (whose carbon footprint tends to be higher) and even paper (whose effluent pollutes fresh water). Packaging, the main bogeyman for consumers, only comprises about 31% of the plastics we consume. The rest is split between a dizzying array of uses, from water pipes to car dashboards, domestic appliances, clothing, and medical devices. Our reflexive dislike of polymers blinds us to the countless ways modern life would be impossible without them.

All that said, with each passing year we see more studies showing how plastics are accumulating in the natural environment and the tissues of humans, animals, and plants. Hard evidence of the harm this causes is scant, but the pathways are well understood — from toxic additives that can be leached out over time, to pollutants absorbed in the environment the way static picks up dust, and then released deep inside the body. Few regret the precautionary approach that previous generations took in the face of early evidence about the harmful effects from tobacco, ozone-depleting chemicals, or greenhouse gases. Given the immense difficulty we will have reining in our polymer habit, a similarly proactive policy makes sense.

What would a global cap on plastics production look like? It’s unlikely to be the most important part of any upcoming treaty. The setting of international standards to eliminate toxic additives like BPA and phthalates (used to make polymers, respectively, more rigid and more flexible) will likely make the biggest difference to human and animal health. Efforts to standardize production processes to ease recycling will have more of an impact on the environment. Support for waste management in fast-growing emerging economies will have the largest bearing on marine pollution. A hard cap, however, could be the sort of difficult-to-achieve target that concentrates minds and unlocks human ingenuity.

Those reductions shouldn’t be impossible to achieve. Most would argue that Japan and South Korea have comparable living standards to the US, but the latter consumes two-and-a-half times as much plastics per capita. If the world as a whole could reduce our usage to roughly the level China sees today and increase reuse toward the rates at which the European Union recycles polymer packaging, we might hold production of new plastics below 500 million tons a year.

That might not sound like much, but it would still be a phenomenal achievement, especially when put against forecasts by the Organisation for Economic Cooperation and Development that we might be heading to more than double those levels.

If you think it’s been hard dethroning fossil fuels’ centrality to our energy system, be prepared for many decades of struggle. Electricity from wind, solar, batteries, and nuclear power provides a compelling alternative to coal, gas, and oil. There are few substitutes waiting in the wings that could repeat that trick with polymers. Plastics are woven through the fabric of modern life quite as intricately as their waste materials are scattered through the natural environment. It won’t be easy to replace them, but the first step is to try.

BLOOMBERG OPINION

Analysts expect better second half for SMIC

SM Investments Corp. (SMIC) is expected to have a better second half as its retail business is projected to benefit from higher consumer spending, the conglomerate said on Monday, citing reports from analysts.

“There was notable recovery in consumer spending in discretionary items such as fashion and home in the second quarter,” Philippine Equity Partners, Inc. Research Analyst Russ Vasilius Toribio was quoted as saying in the press statement e-mailed by SMIC.

During the second quarter, SMIC said that sales in the fashion segment rose by 10.5% year on year, led by back-to-school shopping, while home segment sales grew by 4.6% annually due to warmer weather.

“Moderating inflation increases the purchasing power of consumers, which will drive growth in retail and leisure business,” Mr. Toribio said.

Gilbert Y. Lopez, Macquarie Capital Securities (Philippines) research head, said SMIC’s key businesses “typically have a seasonally stronger second half.”

He added that SMIC’s first-half net profit, which rose by 10% to P40.2 billion, was ahead of the brokerage firm’s forecast but in line with available full-year consensus.

Mr. Lopez noted the sequential improvement in earnings across all of SMIC’s major businesses in retail, banking, and property.

He also mentioned the improvement in retail sales, which reflected consumption recovery. The standout was the health & beauty segment of SM Retail, which grew 16% year on year for both the second quarter and the first half.

SMIC’s retail operations consist of grocery stores, department stores, and specialty retail stores. It also has a presence in the property sector via SM Prime Holdings, Inc., which has interests in malls, residences, offices, hotels, and convention centers, as well as tourism-related property developments.

The conglomerate is also in the banking segment via BDO Unibank, Inc. and China Banking Corp.

On Monday, SMIC shares rose by 0.9% or P8.50 to end at P948.50 apiece. — Revin Mikhael D. Ochave

TransUnion credit scores now accessible on Lista

PRIVATE CREDIT REFERENCE firm TransUnion has partnered with Lista to enable credit scoring on the latter’s financial management app.

The partnership is expected to improve Filipinos’ access to essential consumer credit information, it said in a statement on Monday.

“By leveraging our strengths in information and insights to empower individuals and businesses in decision-making, alongside Lista’s digital finance management platform, we can enhance credit access, improve financial literacy and promote greater financial inclusion in the Philippines,” TransUnion Chief Operating Officer (COO) for Asia-Pacific Amrita Bhattacharya said in the statement.

Under the partnership, Lista users can request credit reports, validate identity documents and settle payments through the app.

Users can receive their credit reports within five minutes of making the request, TransUnion said.

The reports also include insights to improve credit standing, build financial literacy and foster healthy credit habits.

“With credit card ownership growing and more Filipinos looking to borrow or use credit both in the short and long terms, we believe this strategic partnership supports the National Government’s goal of becoming an upper middle-income economy,” Ms. Bhattacharya said.

“At Lista, we are committed to fostering financial literacy by helping Filipinos recognize the importance of fiscal responsibility as early in their financial journeys as possible,” Lista co-founder and COO Khriztina Lim said in the same statement.

“Through our collaboration with TransUnion, we aim to bridge the gap in financial literacy and accessibility to credit information in the Philippines,” she added.

Ms. Lim said they could help Filipinos use the information to build better relationships with their credit and other financial products.

“We believe that everyone should have equal access to financial opportunities, and this partnership will help bring that belief to life,” she added. — Aaron Michael C. Sy

Manila leads in Prime Global Cities Index

The Philippine capital’s luxury residential prices grew by 26% year on year in the second quarter, based on the latest edition of the Prime Global Cities Index by real estate consultancy firm Knight Frank. Manila bested 44 residential markets for the fourth consecutive quarter.

Manila leads in Prime Global Cities Index

D&L Industries completes redemption of P3-B fixed rate bonds

LISTED D&L Industries, Inc. has completed the redemption of its Series A fixed rate bonds worth P3 billion.

“These bonds were issued in 2021 and matured today,” D&L said in a regulatory filing on Monday.

The P3-billion Series A fixed rate is part of D&L’s P5-billion fixed-rate bond offer issued in September 2021 to partly fund the company’s Batangas plant, which started commercial operations in July 2023. The Series A bonds carried a rate of 2.7885%.

The remaining P2-billion Series B is priced at 3.5962% per annum and has a five-year tenor.

For the first half, D&L Industries logged a 6% jump in its net income to P1.32 billion from P1.24 billion last year.

January-to-June sales rose by 17% to P18.98 billion from P16.23 billion last year, with export sales up by 57% year on year.

D&L is engaged in the production of customized food ingredients, specialty raw materials for plastics, and oleochemicals for personal and home care use.

On Monday, D&L shares rose by 1.27% or eight centavos to P6.38 apiece. — Revin Mikhael D. Ochave

Insurers eye guide rates for motorcycle taxis, EVs

PHILIPPINE STAR/EDD GUMBAN

THE NONLIFE insurance industry is looking at setting guide rates for new products that will cover motorcycles and electric vehicles (EV) because companies that cover these sectors are selling at a loss, the Philippine Insurers and Reinsurers Association (PIRA) said.

PIRA Executive Director Michael L. Rellosa told reporters last week that for one, they have very little information about how motorcycle taxis are doing. “So we’re learning as we go. And apparently, some of the early companies who wrote it first, are starting to get losses.”

He also said motorcycles used in ride-hailing apps have coverage already, but companies that cover them have been experiencing losses that continue to rise.

“So, we have to look into how best we can rate it going forward,” he said. “Now, the Insurance Commission is also asking the industry to come up with guide rates, but right now, we’re still in the process of collecting information.”

Latest data from the Insurance Commission showed net premiums from the motor sector rose by 8.42% to P13.82 billion at end-June from a year earlier.

“The information that we need is premiums versus losses, so we can arrive at the technical rate — the rate that covers the risk itself,” Mr. Rellosa said.

He added that insurers need to factor in not just the driver of motor taxis, but also the passengers because motorcycles are more prone to accidents.

Mr. Rellosa said only about five companies have started writing coverages for motorcycle taxis, while others are still looking into it.

“The others are waiting to see how it goes, if it’s going to be a profitable line for them to go into. And the jury’s still out. They need more information to make a decision,” he added.

PIRA has reached out to the Metropolitan Manila Development Authority (MMDA), Land Transportation Franchising and Regulatory Board (LTFRB) and Land Transportation Office (LTO) for data on accidents related to the sector, he said.

“We also wrote to the companies that have initially written that kind of business and they haven’t gotten back to us yet,” he said. “But once we have some semblance of data we can rely on or trust, we can make the correct assumptions and we can extrapolate the rate, pass it through actuarial analysis and all that.

Mr. Rellosa said the industry is also evaluating the rates needed to cover electric and hybrid vehicles.

“We know the cost [of combustion engines] and all that,” he said. “We’re used to that. While for electric vehicles, the battery itself costs 50% of the vehicle. So the valuation is off.”

Aside from rates, the industry is also formulating the proper coverage for EVS. “Again, we cannot use the normal motor policy because it just doesn’t add up. There are different or new kinds of risks that come with the electric and hybrid vehicles,” Mr. Rellosa said.

EVs are also more affected by potholes, road bumps and flooding because most models are built with the battery at the bottom of the car, he added.

“There are so many new issues that are coming with the new types of vehicles. But the industry has to catch up. We’re a little slow,” Mr. Rellosa said.

Total net premiums written by nonlife insurance companies rose by 7.14% to P32.89 billion in the first half from a year earlier, based on data submitted by 52 out of 56 licensed firms. — Aaron Michael C. Sy

Italy seizes €50M worth of counterfeit copies of vintage video games

COMMONS.WIKIMEDIA.ORG
COMMONS.WIKIMEDIA.ORG

MILAN — Italian tax police said on Friday they have seized counterfeit Chinese copies of vintage game consoles and video games from the 1980s and 1990s worth almost 50 million ($55.5 million).

New versions of video games and gaming consoles popular decades ago have recently been re-released in a phenomenon known as “retrogaming.”

The Guardia di Finanza tax and customs police in the northwestern city of Turin said in a statement that they had seized around 12,000 gaming consoles in several provinces across Italy starting from late 2023. The consoles were “all from China,” the police statement said.

The consoles contained more than 47 million pirate copies of old video games, lacked proper EU-mandated health and safety labels and were equipped with non-certified batteries and electrical circuits, police said.

They were sold in shopping malls, online marketplaces, and Italian company websites.

Nine people, all Italian nationals, have been placed under investigation for various crimes connected to fraudulent trading and copyright infringement, while the seized video games were all destroyed. — Reuters

Overseas Filipinos’ Cash Remittances

MONEY SENT HOME by overseas Filipino workers (OFWs) rose to a seven-month high in July, data from the Bangko Sentral ng Pilipinas (BSP) showed. Read the full story.

Overseas Filipinos’ Cash Remittances

Shang Properties starts building 80-storey Shang Summit in Quezon City

SHANG Properties, Inc. (SPI) has commenced construction on Shang Summit, an 80-storey, two-tower luxury residential development in Quezon City.  

The East Tower will be the first to rise this year, SPI said in a statement on Friday last week. 

“Through Shang Summit, SPI reaffirms its commitment to redefining luxury living in the Metro,” SPI Executive Director Wolfgang Krueger said. 

Shang Summit’s studio unit will span 37 to 39 square meters (sq.m.) and is set to provide “an intimate yet spacious living experience with its large window frames that showcase city views and natural light,” the company said. 

The one-bedroom units, which range from 51 to 70 sq.m. feature living room configurations that integrate open kitchens, dining areas, and outdoor balconies.

Meanwhile, the 88- to 125-sq.m. two-bedroom residences will have private balconies, master suites, and “ample” wardrobe space.

Shang Summit, which features the East and West Towers is a collaboration between SPI and architects and designers P&T Group, FM Architettura, and CASAS + Architects, Inc.

Among its amenities include coworking lounges, extensive play areas for children of all ages — from toddlers to teenagers, and a lounge area for socializing.

“The development will also feature the Shang Summit Gallery, which offers elegant spaces for relaxation and social gatherings, while The Alcove provides quiet, serene environments ideal for work or study,” the company said. 

In addition, a tropical pool with an alfresco deck and fitness center by TechnoGym will be available for residents. — Aubrey Rose A. Inosante

Sectoral parochialism in health and the declining population net increase

Three recent items in the Opinion Section of this paper have discussed using the idle funds of the Philippine Health Insurance Corp. (PhilHealth) to fund some unprogrammed appropriations in the 2024 budget.

These were the Sept. 11 Thinking Beyond Politics column, “Making public money work for the people: Idleness of funds is idleness in service,” by Victor “Dindo” Manhit, a Letter to the Editor by Department of Budget and Management (DBM) Undersecretary Goddes Hope O. Libiran which came out on Sept. 13, and the Sept. 16 Yellow Pad column, “Current demographic trends do not justify reduction of PhilHealth premiums,” by Charl Andrew Bautista, Elma Laguna and Michael Abrigo.

The Manhit article supports the move by the Department of Finance (DoF) and Secretary Ralph G. Recto, noting, for example “an initial remittance of P20 billion from PhilHealth was used to settle P27.5 billion in unpaid COVID-19 allowances for frontliners, covering 5.04 million claims. Is this not a good thing?” Good position there, Dindo.

The DBM letter was in response to four claims made in the Sept. 9 Yellow Pad column, “Patronage politics has caused the loss of health insurance coverage for millions of Filipinos,” by Juan Antonio Perez III which the DBM said was “in the interest of accuracy and balanced views to avoid unnecessary alarm to the public, perpetuated by false, fear-mongering, and misleading news reports such as this.” Good correction there, Ms. Libiran.

The Yellow Pad piece by Bautista, Laguna, and Abrigo suggests that to “maximize the benefits of the increased premium collections” they should, among others, “Invest the surplus in expanding PhilHealth packages” in order to “improve cost coverage to prevent catastrophic health expenditures for individuals and families,” and “prepare for the eventual population aging.”

A common practice of advocates of what I call “sectoral parochialism” is to argue that their favorite sector is so important that whatever budget is given to it by DBM and Congress will never be enough and must be increased significantly. Thus, the P90 billion in excess PhilHealth funds should not be used for other sectors. Instead, whenever possible, it should be increased, doubled, quadrupled, or higher.

The DoF, DBM, and the National Economic and Development Authority (NEDA), which comprise the government’s economic team, see the overall picture of all agencies and all possible sources of funds (taxation, regulatory fees, and borrowings). Since the Philippines’ public debt is already high — the annual borrowings and interest payment keep rising even without an economic or finance crisis — the economic team will tap other domestic sources and avoid additional borrowing whenever possible. The economic team is correct in doing this. And the lobbyists and advocates of “sectoral parochialism” dislike them, even attack them and produce “false, fear-mongering, and misleading news,” like the opponents of reallocating PhilHealth’s excess funds to unprogrammed appropriations.

From 2022 to 2024, during which time there has been no economic or health crisis, and no more lockdowns, some expenditures like temporary subsidies should have been cut in order to have a fiscal surplus, in order to reduce borrowings and reduce interest payments. But this did not happen and is not happening.

From 2022 to 2024, we still had an average deficit of P3 billion to P4.4 billion/day, our interest payments alone were P1.4 billion to P2.2 billion/day — principal amortization not included yet in that number. New net borrowings were P5.4 billion to P6.4 billion/day. And even when interest rates were hiked, like 6% for T-bills and 6.7% for T-bonds, government kept on borrowing (see Table 1).

Secretary Recto, Secretary Amenah Pangandaman, Secretary Arsenio Balisacan, please proceed with tapping any domestic revenues you can and avoid new borrowing whenever possible. Fiscal realism should prevail over sectoral parochialism.

On the Philippines’ changing demographics as discussed by the Bautista, Laguna, and Abrigo in their column, here are some statistics from the Philippine Statistics Authority (PSA) which they did not mention: rising deaths, declining births, and the declining population net increase.

In 2020, when hundreds of new COVID-19 cases were reported daily and a severe lockdown was imposed by the government, there were no excess deaths over those reported in 2019. But in 2021, when mandatory vaccination was imposed (otherwise it was the mandatory to present costly PCR-tests taken every two weeks at the individual’s cost), deaths increased from 1,682/day in 2020 to 2,410/day in 2021 then 1,862/day in 2022.

The average number of births declined, from 4,188/day in 2020 to 3,739 in 2021, and 3,776/day in 2023. The population net increase (births minus deaths) also declined significantly, from 2,506/day in 2020 to only 1,329 in 2021, and 1,960/day in 2023 (see Table 2). And we are seeing this ugly declining trend in population expansion.

The Philippines may have spent some P200+ billion on COVID-19 vaccines plus transport, storage, and other logistics in 2021-2022 alone, in both government (national and local) and corporate procurement.

Health is first and foremost a personal and parental responsibility, only secondarily is it a government responsibility. This is so whether dealing with communicable/infectious or non-communicable/non-infectious diseases. When people say that it is OK for the poor to buy alcohol, tobacco, fatty food, then say that it is not OK for the poor to contribute to their own health insurance even at a minimal amount, then we have a problem.

 

Bienvenido S. Oplas, Jr. is the president of Bienvenido S. Oplas, Jr. Research Consultancy Services, and Minimal Government Thinkers. He is an international fellow of the Tholos Foundation.

minimalgovernment@gmail.com

How PSEi member stocks performed — September 16, 2024

Here’s a quick glance at how PSEi stocks fared on Monday, September 16, 2024.


PHL to keep ‘strategic’ presence at Sabina Shoal

PHILIPPINE COAST GUARD/ONE NEWS FILE PHOTO

By Kyle Aristophere T. Atienza, Reporter

THE PHILIPPINES will go beyond ship deployment in keeping a “strategic” presence in Sabina Shoal, a maritime council said on Monday after the pullout of the country’s largest coast guard vessel from the disputed atoll.   

“The President’s directive is to maintain our presence in Escoda Shoal,” National Maritime Council spokesperson Alexander Lopez told reporters at the presidential palace in mixed English and Filipino.

“When we say presence, strategic presence, not just physical presence,” he added. “I just want to make clear that our presence is not limited to sending a single ship.”

Mr. Lopez said the pullout of the 97-meter BRP Teresa Magbanua five months after its deployment to Sabina should not be a cause for concern as the government uses other measures to monitor the South China Sea feature that he said is as big as the cities of Caloocan, Navotas, Malabon, and Manila combined.

“Even if Teresa Magbanua left, it did not diminish our presence in the area because we have other ways to monitor,” he said, citing the deployment of planes and technical surveillance capabilities.

“We are also asking for help from our allies on how to go about this technical coverage,” he added.

Mr. Lopez said the Philippine Coast Guard (PCG) had already sent a replacement for its largest ship after it left Sabina Shoal on Sept. 14.

The council also said the ship needed to undergo repairs and that some of its crew needed to address their medical needs. The repositioning would also give the ship’s crew a furlough so they could have a reunion with their loved ones, it added.

BRP Teresa Magbanua was deployed in mid-April amid reports that Beijing was dumping the atoll with dead corals to alter its elevation.

There have been collisions of Chinese and Philippine vessels since last month near Sabina, which lies 140 kilometers off the Philippine westernmost island of Palawan.

NOT LOST TO CHINA
PCG spokesman for the West Philippine Sea Jay Tristan Tarriela said separately on Monday that the pullout of the Philippine vessel did not mean that the country had lost Sabina Shoal to China.

“As far as the Philippine Coast Guard is concerned, we have not lost anything,” he said at a news conference.

“Escoda Shoal, no matter how many instances we intend to go there, we will be able to patrol and deploy our vessel,” he added.

He said despite China’s presence, Philippine vessels can still go to Sabina because it has many entry points unlike Scarborough Shoal, which has only one entrance.

Beijing has effectively controlled Scarborough, which also falls within Manila’s exclusive economic zone (EEZ) but is also claimed by several other countries, in 2012 after maintaining constant coast guard presence there, according to the Asia Maritime Transparency Initiative.

“Bajo de Masinloc only has one single entrance and that is the southeast entrance of the lagoon in Bajo de Masinloc,” he said.

“Escoda Shoal is composed of two lagoons on the west side and eastern side,” he added. “Each lagoon has different areas where you can pass through.”

China claims the South China Sea almost in its entirety including within the Philippine EEZ, rejecting an international ruling that its assertions based on a 1940s map has no legal basis.

Sabina has been a staging ground for Philippine resupply missions to Second Thomas Shoal, in which Manila grounded a Navy vessel in 1999 to serve as an outpost for Filipino troops.

Manila and Beijing came up with a resupply deal during a so-called bilateral consultation mechanism (BCM) in July following a June 17 standoff in which Chinese forces threatened Filipino troops delivering supplies to the Navy outpost, using bladed weapons. 

Mr. Lopez, speaking to Palace reporters, reiterated that the pullout of Magbanua was not a capitulation to previous Chinese demands.

“We did not withdraw, and this was not the agreement during the last BCM. People might think we gave in, but in fact, we didn’t,” he said in mixed English and Filipino.

“We stood our ground during the meeting in Beijing and our Department of Foreign Affairs stated that our presence will be maintained at the shoal, so it’s not a withdrawal.”

Mr. Tarriela said Chinese vessels had successfully blocked previous resupply missions of Philippine ships in Sabina Shoal because China already knew that BRP Teresa Magbanua was the destination.

“But right now, there is no reason for us to be blocked. We can go to Escoda Shoal with such a total area and it’s almost impossible for the Chinese government to block our intent to patrol the entire vicinity,” he said.

HIGHER PCG FUNDING
A senate leader on Monday said Congress should ensure more funding for the PCG to maintain the country’s presence in the disputed waters following the pullout of the Philippine vessel after a months-long standoff with China.

“Increasing budgetary support is essential to ensure that all deployed vessels receive adequate provisions and regular maintenance to sustain seaworthiness,” Senate President Pro-Tempore Jose “Jinggoy” P. Estrada, Jr. said in a statement.

He cited the need to provide medical and welfare support for coast guard personnel and for the government to invest in technologies that would help navigation in extreme weather.

Mr. Estrada told a forum last month that the Senate is likely to boost funding for Manila’s coast guard and the armed forces to beef up the country’s defenses amid growing tensions with Beijing.

Defense agencies will get P256.1 billion under the Budget department’s P6.352-trillion proposed national budget for next year.

The Philippine Army, Air Force, and Navy will get P204.4 billion, while P50 billion will go to modernization efforts of the Armed Forces of the Philippines, according to a summary of the Budget department’s national expenditure plan.

“By allocating the necessary budgetary resources, we can uphold the PCG’s role as a formidable force in defending our maritime territories and protecting our national interests,” Mr. Estrada said.

RULES-BASED ORDER
Also on Monday, the German government, through its envoy in Manila, affirmed its commitment to upholding a rules-based international order amid rifts in the South China Sea as two naval ships docked in Manila for the Indo-Pacific Deployment 2024 (IPD 24).

“The visit today here is a clear commitment to freedom of navigation, a clear commitment to the United Nations Convention on the Law of the Sea (UNCLOS), a clear commitment to freedom of navigation and the international rules-based order,” German Ambassador to the Philippines Andreas Michael Pfaffernoschke told reporters in a news briefing in Manila City on Monday.

“In the West Philippine Sea, Germany stands with the Philippines on the side of international law. Our message is clear: respecting UNCLOS by all parties concerned is essential for lasting peace and stability in the region. This is what the IPD stands for,” said the envoy.

International affairs lecturer at the De La Salle-College of St. Benilde School of Diplomacy and Governance Josue Raphael J. Cortez said the visit of the German ships is timely as the two countries aim to sign a defense deal.

“This is undoubtedly timely given that the Philippines and Germany are targeting to sign its defense deal prior to the end of 2024,” he told BusinessWorld in a Facebook Messenger chat on Monday.

“It is a way to signal that despite the treaty being still a draft and awaiting signatures by the two countries, Germany is committed to aiding the Philippines should China undertake something in relation to their ongoing fiasco on the disputed territories,” he added.

Mr. Pfaffernoschke said that Berlin had pledged to ensure free and secure shipping routes in its 2020 Indo-Pacific Strategy, reaffirming the promise in its 2023 German National Security Strategy.

Manila and Beijing are facing maritime conflicts in the South China Sea as the latter continues to ignore a 2016 Permanent Court of Arbitration ruling in favor of Manila.

The Chinese Embassy in Manila did not address the issue in their response to a Viber message seeking comment. — with reports from John Victor D. Ordoñez and Chloe Mari A. Hufana