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Tips for improving fuel economy

Oil prices are climbing and motorists are hurting. Although there seems to be little likelihood that those prices will drop anytime soon, motorists can take a variety of steps to improve the mileage of their vehicles and save themselves money.

They can start by simply slowing down. “In our tests we’ve found that driving faster on the highway can really take a bite out of a car’s fuel efficiency,” Consumer Reports, an American nonprofit organization that reviews and rates products, says in an article published on its Web site.

The organization calculated gas mileage while driving at three different speeds — 55, 65 and 75 miles per hour (mph) — in five vehicles. It observed that fuel economy dropped by four to eight miles per gallon (mpg) while speeding up from 55 to 65 mph. When the speed was increased to 75 mph, fuel efficiency was reduced by an additional five to seven mpg.

“Overall, speeding up from 55 mph to 75 is like moving from a compact car to a large SUV. Beyond fuel concerns, speeding is, of course, a safety risk as well,” Consumer Reports says.

It will also help to avoid hard acceleration and braking. The organization found that frequent bursts of acceleration and braking cut an old mid-size car’s mileage by two to three mpg.

It recommends maintaining a steady pace once up to speed on a highway. “Smooth acceleration and braking also extend the life of the engine, transmission, brakes, and tires,” it adds.

Car owners should know better than to leave their vehicles idling for prolonged periods. Not only does it waste fuel, it’s also harmful to the environment.

“Did you know that running your engine at idle actually consumes roughly half a gallon to about a gallon of fuel every hour, not to mention the carbon dioxide that your engine pumps into the atmosphere?… This means you’re burning about 1.067 to 2.13 ounces of fuel every minute that you are idle. This easily translates to about 10.67 ounces to 21.33 ounces for every 10 minutes of idling,” CarBibles.com, an automotive site, says.

The Union of Concerned Scientists (UCS), a USA-based nonprofit science organization, suggests not letting a vehicle idle for more than a minute. “During start-up, your engine burns a little extra gasoline. However, letting your engine idle for more than a minute burns more fuel than turning off the engine and restarting it,” it says.

Try not to put so much stuff on a vehicle’s roof. “Securing things on the roof increases aerodynamic drag, making the engine work harder and hurting fuel economy,” Consumer Reports says. When the organization tested a 2013 sedan at a steady 65 mph, the vehicle got 42 mpg without anything on its roof.

“Adding an empty bike rack dropped the mileage by 5 mpg. A wind deflector reduced the wind noise but cut gas mileage to 35 mpg. And with two bikes on the rack, gas mileage dropped to 27 mpg, a whopping 15-mpg difference overall,” the organization says.

Whenever possible, turn off the air-conditioning and roll down the windows instead. Consumer Reports says that the harder the air-conditioning system has to work, the worse the impact on a vehicle’s fuel economy.

“In general, expect a drop from 1 to 4 mpg with the air-conditioning running. The effect of opening the windows at 65 mph was not measurable,” it adds.

Maintaining one’s vehicle can help a lot in increasing its fuel economy. According to HowStuffWorks, a commercial education Web site, making sure that a vehicle’s tires are set to recommended pressure can increase fuel economy by as much as 3.3%.

CarBibles.com explains that running on low tire pressure increases the rolling resistance of the tires on the ground surface. “This robs you of very precious fuel.” It advises vehicle owners to inflate the tires to their correct pressure even before rolling them out of the garage.

Switching to low-rolling resistance tires might be a good option. But Consumer Reports warns about replacing tires too early in an effort to chase the pennies those tires may save in fuel.

“It’s better to look first for a tire that provides good all-around performance in important safety areas such as braking, handling, and hydroplaning resistance. Then use its rolling resistance level as the tiebreaker,” it says.

HowStuffWorks also recommends replacing dirty air filter (which can save up to 10% on fuel costs), following a car manufacturer’s recommended maintenance schedule (up to 4.1% increase in fuel economy can be realized by doing this), and using the manufacturer’s specified motor oil and changing it per factory recommendations.

Switching from gasoline-guzzling cars to the more fuel-efficient ones should be a no-brainer, especially if one has the wherewithal to do so.

“If you are in the market for a new vehicle, choose the most fuel-efficient one that meets your needs. Thanks to strong new fuel economy standards, there are more efficient options in dealer showrooms than ever before, including steadily-increasing numbers of conventional gas-powered cars that achieve greater than 40 mpg,” UCS says.

Oil tax hike suspension looms

MALACAÑANG and Congress have agreed on the need to suspend an oil tax hike set in January, a move one senior Finance official said is justified given current world crude price forecasts.
The development comes as headline inflation has lately been hitting multiyear peaks — largely on surging world crude prices — averaging five percent in the nine months to September against the central bank’s 2-4% target range for full-year 2018.
Next year will also be marked by mid-term elections in May.
Special Assistant to the President (SAP) Christopher T. Go said on Sunday that President Rodrigo R. Duterte and his Cabinet have discussed this issue, while majority of senators submitted an Oct. 9 letter to Mr. Duterte seeking such a move even before the “trigger period” set by Republic Act No. 10963 or the Tax Reform for Acceleration and Inclusion Act (TRAIN) that took effect last January.
“The President and the Executive department is now looking into the temporary suspension of the next increase of oil excise tax rates in 2019… This is scheduled to be imposed by January of next year as mandated by the TRAIN Law,” Mr. Go said in a speech on Sunday morning at the opening of the Department of Agriculture’s TienDA Malasakit Food Outlet in Taguig City.
That law increased fuel excise taxes by P2.5 per liter this year, and is scheduled to raise the levy by P2 and P1.5 per liter in 2019 and 2020, respectively, totaling a P6 excise tax hike.
The law suspends the hike automatically should average crude oil price, based on Dubai, reach $80 per barrel (/bbl) in these last three months. Price of Dubai crude — used as a benchmark for Asia — rose 43% to $77.02/bbl in September from $53.86/bbl a year ago and by 6.78% from August’s $72.23/bbl. Prices averaged $82.278/bbl in the 10 trading days to Oct. 12, 50.69% more than the $54.602/bbl in last year’s comparable period.
“But to arrest the rising price of oil and its effects on the inflation rate, we will defer implementing it until the right time,” Mr. Go said in his speech, even as he clarified in a statement later in the afternoon “pero ikonsidera rin natin kung ano ang nasa TRAIN law (we will consider what is provided by TRAIN).”
Sought for clarification, Finance Assistant Secretary and Spokesperson Antonio Joselito G. Lambino II said in a Viber message that “[a]s announced by SAP Bong Go, the President is making an early announcement of the temporary suspension of the January 2019 oil excise increase under the TRAIN Law”.
“Today’s price and multiple estimates of crude prices over the next two months show that the average price will stay above the $80 threshold, and it is therefore being announced early that the suspension mechanism will be activated,” Mr. Lambino explained.
“This announcement is being made two months before the time required by law, to proactively anchor inflation expectations and enhance the welfare of the Filipino people,” he added.
“After consulting the leadership of both the Senate and the House of Representatives, as well as the economic team, the President is confident that this course of action will help anchor inflation expectations for the coming year, allow the public to manage finances better, and disallow hoarders and profiteers from taking advantage of the situation.”
SENATE PLEA
The Senate majority has sought Mr. Duterte’s support for Congress’ plans to suspend the scheduled increase in fuel excise tax come January.
“We, the undersigned senators who are supportive of your reform efforts, respectfully solicit your support in a move of both Houses of Congress to suspend any further increases in excise taxes on diesel, gasoline and other petroleum products for 2019 and 2020 as mandated by R.A. 10963, or the ‘Tax Reform for Acceleration and Inclusion’ Law,” the senators said in their Oct. 9 letter to the President.
The letter was signed by Senate President Vicente C. Sotto III, Senate Majority Leader Juan Miguel F. Zubiri, Senator Joseph Victor G. Ejercito on Sunday, Senate President Pro tempore Ralph G. Recto, as well as Senators Loren B. Legarda, Juan Edgardo M. Angara, Nancy S. Binay-Angeles, Francis G. Escudero, Sherwin T. Gatchalian, Richard J. Gordon, Gregorio B. Honasan II, Panfilo M. Lacson, Emmanuel D. Pacquiao, Aquilino L. Pimentel III, Grace S. Poe-Llamanzares, Joel J. Villanueva and Cynthia A. Villar.
“This was discussed with the President during our Monday meeting with him. SOF (Secretary of Finance Carlos G.) Dominguez (III) just asked us to formalize it with a letter as the President will consider the suspension of excise tax on fuel when he gets back from Bali. That letter was signed by all the members of the Majority,” Mr. Zubiri told reporters in a mobile phone message.
“That is the reason PRRD (President Rodrigo R. Duterte) decided to suspend excise tax,” Mr. Sotto told reporters in a mobile phone message, for his part.
The Senate in the letter expressed grave concern over the prediction of the oil traders of S&P Global Platts Asia Pacific Petroleum Conference in Singapore, as cited by the Department of Energy’s oil monitor report, that crude oil prices could increase to over $100/bbl in 2019.
They asked Messrs. Duterte and Dominguez to support their initiatives to suspend any further increases on fuel excise tax “before the TRAIN Law’s ‘trigger period.’”
“Hence, considering that the high crude oil prices are projected to continue increasing, we respectfully request your Excellency and DoF Secretary Carlos Dominguez III to support our initiatives to suspend any further increases in excise taxes on diesel, gasoline and other petroleum products before the TRAIN Law’s ‘trigger period,’” they said.
The senators said the suspension of fuel excise tax hike “would help lift the heavy burden” that Filipinos have been experiencing amid the rising prices of basic goods and services. — Elijah Joseph C. Tubayan, Arjay L. Balinbin and Camille A. Aguinaldo

IMF: PHL robust for rate hikes, trade gap

By Melissa Luz T. Lopez
Senior Reporter
THE PHILIPPINE ECONOMY is strong enough to cope with rising interest rates and a growing external trade gap, the International Monetary Fund (IMF) said last weekend.
Ken Kang, deputy director at the IMF’s Asia and Pacific Department, said that the Philippine economy is resilient in the face of rising interest rates worldwide. “Overall, I think the debt repayment capacity in the Philippines remains strong,” Mr. Kang said in a press briefing at the sidelines of the joint World Bank-IMF annual meeting in Bali, Indonesia late Friday.
The IMF official said the Philippines can absorb the impact of rising yields on its outstanding debt, given that this burden accounts for a “relatively low” share in the overall economy.
Unpaid debts from foreign creditors amounted to $72.199 billion as of June, equivalent to 22.5% of gross domestic product (GDP). This declined from a 23.5% share as of June 2017 and is modest compared to the country’s counterparts.
The Philippines can also stand its ground in the face of a growing trade gap, the multilateral lender said.
“The current account deficit has increased on the back of higher oil prices and import demand, but at a 1.5% (of GDP) deficit, it still remains manageable,” Mr. Kang said.
“Moreover, reserves at about $80 billion represent seven months of import coverage and about four times the size of short-term external debt falling due,” he added. “But perhaps most importantly, growth remains robust.”
The current account reflects fund flows from goods and services trading. A deficit meant more funds fled the country compared to what went in.
The IMF sees the current account deficit settling at 1.5% of GDP this year, which if realized will top the 0.9% of GDP forecast of the Bangko Sentral ng Pilipinas (BSP) for 2018. It will likewise widen from the $2.518-billion gap posted in 2017 equivalent to 0.8% of GDP.
The current account posted a $3.1-billion deficit as of end-June, compared to a $133-million gap in 2017’s first half, already hitting the full-year 2018 estimate as imports continue to grow by double-digit pace while exports remain slumped.
Global oil prices have increased for the ninth consecutive week, leading to a bigger import bill for the Philippines.
Still, this is expected to be offset by the $75.161-billion dollar reserves held by the BSP. This is enough to cover 6.8 months’ worth of imports or pay 5.9 times outstanding foreign debt, although it was the lowest level seen in seven years.
The IMF has downgraded its growth forecast for the Philippines to 6.5% this year and 6.6% in 2019, falling short of the 7-8% target set by the Duterte administration.
The growth estimate for 2018 was revised from 6.7% previously, with the IMF citing last semester’s slower-than-expected 6.3% that compared to the 6.6% recorded in 2017’s first half.
The IMF sees faster growth this semester, but flagged risks like rising oil prices and headline inflation, rapid credit growth, worsening global trade tensions and tighter credit conditions.
The 2019 revision, on the other hand, factors in the impact of a changing external environment, particularly “escalating trade tensions” between the United States and China, IMF country representative Yongzheng Yang said last week.
The IMF expects the government’s infrastructure push and a steady stream of foreign direct investments — coupled with continuing robust private consumption — to sustain the economy’s expansion.
The forecasts for the Philippines are better than the Association of Southeast Asian Nations (ASEAN) averages of 5.2% and 5.1% for 2018 and 2019, respectively.
World leaders and central bankers gathered in Bali last Oct. 8-14 for the annual IMF-World Bank meeting, where they cited the need to “act promptly” and put in place reforms to “protect the expansion, mitigate risks, rebuild policy space, enhance resilience and raise medium-term growth prospects for the benefit of all,” according to the communiqué published on Friday.
The economic officials cited the need to maintain strong fundamentals, sound policies and a resilient international monetary system to maintain stable and flexible exchange rates, which comes at a time of highly-volatile currency markets.
In a separate statement issued over the weekend, BSP Deputy Governor Diwa C. Guinigundo assured that Philippine authorities are taking steps to keep the economy on solid footing.
“We are very confident in the underlying strength of our economy,” Mr. Guinigundo said following the World Bank-IMF meeting.
“The Philippines remains one of the best performing economies in the fastest growing region in the world. GDP growth remains strong, FDI inflows are at record levels, infrastructure investment is booming, and we have historically low levels of public sector debt.”
He added that recent peso swings against the dollar are “expected” and that the local unit remains “stable and competitive” relative to other currencies.

DoF mulls catastrophe bonds of WB

THE PHILIPPINES is considering participation in the World Bank’s catastrophe (Cat) bonds to support financing of disaster risk management, the Department of Finance (DoF) said in a statement over the weekend.
The DoF said that the Philippines is “exploring” to be a sponsor of such bonds that will be offered by the World Bank.
This possibility was discussed in a meeting between Finance Secretary Carlos G. Dominguez III and top Citigroup, Inc. officials at the sidelines of the World Bank-International Monetary Fund Annual Meetings in Bali, Indonesia last week.
“… [T]he Philippines as sponsor of the Cat bonds will get paid the principal contributed by investors if a catastrophe occurs. But if there is no trigger, then investors would make a positive return on their investment in the bonds,” the DoF explained in its statement.
The Cat bond allows the sponsor to mitigate calamity financial risks. Since investors will be betting against the likelihood of the disaster, the investment carries higher rates.
It will be recalled that the Philippines last participated in a Cat bond sale in the aftermath of supertyphoon Haiyan, locally called Yolanda, that razed its way through the Visayas in November 2013.
According to the DoF, Citi vice-chairman for Corporate and Investment Banking Jay Collins said that the Cat bonds are attractive to hedge-fund investors and asset managers because these diversify their portfolio.
National Treasurer Rosalia V. De Leon said in a mobile phone message on Sunday that the government was “still discussing with WB” the possibility of the Philippines’ participation.
The World Bank last sold Cat bonds in February, raising $1.36 billion with Chile, Colombia, Peru and Mexico — the lender’s single largest single issuance of such debt.
The DoF said that Mr. Dominguez “welcomed” Citi’s proposal.
Mr. Dominguez said that he wants to get local government units (LGUs) involved since they are in a better position to assess disaster risks. “I want the local executives to participate. Right now, we have a local autonomy law and quite a number of the LGUs are liquid that they can buy the insurance,” Mr. Dominguez was quoted as saying.
The Finance chief also said that other Association of Southeast Asian Nations (ASEAN) member-states can also participate as sponsor “so that funds could be pooled to push down the price of insurance premiums for each country-participant.”
The DoF also said the Philippines was “open” to Citi’s proposal on launching Global Depositary Notes (GDNs), by which peso-denominated debt instruments are offered to offshore investors “to help diversify the country’s investor profile while enhancing the liquidity available in the domestic economy.”
GDNs would allow international institutional investors to access the Philippine domestic sovereign debt market through investments in peso-denominated debt instruments while trading in US dollar terms.
The DoF said such proposal is timely, given moves to reduce the withholding tax on interest income from 20% to 15% even for non-resident investors, as part of the fourth package of the tax reforms program pending in committee-level at the House of Representatives.
The DoF quoted Mr. Collins as saying that Citigroup is interested in “wanting to attract foreign buyers to the peso market to keep those yields down in this environment.”
It also said that it “will consider” the SDG bonds, to raise funds for projects that contribute to achieving the United Nations’ Sustainable Development Goals (SDG). — Elijah Joseph C. Tubayan

AC Energy inks $83-million EPC contract for development of solar farms in Vietnam

AC ENERGY, Inc., along with its Vietnamese partner, has signed construction and financing contracts for the development of solar plants in Vietnam valued at an estimated $83 million, the Ayala-led company said during the weekend.
In partnership with AMI Renewables Energy Joint Stock Co., the Ayala Corp. energy platform signed engineering, procurement and construction (EPC) and financing documents to build solar farms with a total capacity of 80 megawatts (MW).
“We are excited to expand our development initiatives in Vietnam and work with our local partner AMI Renewables,” said AC Energy President and Chief Executive Officer Eric T. Francia in a statement.
“We appreciate the strong commitment of the Vietnam government to promote renewables, and the strong support from our banking partners that are providing project finance,” he added.
The joint venture, which plans to build the solar projects in the provinces of Khanh Hoa and Dak Lak, targets the commissioning date ahead of the June 2019 solar feed-in tariff deadline in Vietnam.
The projects will be financed with debt and equity, said AC Energy, adding that it will participate with at least a 50% economic share.
Indovina Bank of Vietnam and Rizal Commercial Banking Corp. (RCBC) of the Philippines will provide non-recourse financing for the Dak Lak and Khanh Hoa projects, respectively.
Last year, AC Energy formed a platform company with AMI Renewables to build renewable energy plants in Vietnam, including the 352-MW Quang Binh wind project.
It becomes AC Energy’s second renewable energy platform in Vietnam after it partnered with BIM Group of Vietnam to develop more than 300 MW of solar power in the regional neighbor.
In January this year, the joint venture broke ground with a 30-MW solar project valued at 800 billion Vietnamese dong or P1.8 billion, with plans to expand the capacity to more than 300 MW in Vietnam’s Ninh Thuan province.
In August, the joint venture signed EPC and financing documents, increasing the target capacity of the solar farm to 280 MW. The project is estimated to cost around $237 million, which will be financed by debt and equity. AC Energy will participate with a 30% voting stake and about 50% economic share.
AC Energy, a fast-growing energy company with more than $1 billion of invested and committed equity in renewable and thermal energy, aspires to develop 5 gigawatts of attributable capacity and generate at least 50% of energy from renewables by 2025. — Victor V. Saulon

BPI Securities sees PSEi at 8,900 by end-2019

By Arra B. Francia, Reporter
BPI SECURITIES Corp. projects to see the local stock barometer at the 8,900 level by the end of 2019, factoring in concerns on inflation and rising interest rates.
“We think 8,900 is a good target for next year because that will already price in not only the inflation concerns but some of the adjustments we’ve seen in interest rates,” BPI Securities President and Chief Executive Officer Hermenegildo Z. Narvaez told BusinessWorld in a recent interview.
The 2019 projection is 8.54% higher than BPI Securities’ estimate that the Philippine Stock Exchange index (PSEi) will close at around the 8,200 level this year, as per an expected rally sometime in December.
The PSEi is currently at the 7,000 level, finishing Friday’s trading at 7,078.20. This marks a 21.87% drop, or nearly 2,000 points, from the market’s record close of 9,058.62 last Jan. 29.
Mr. Narvaez said the main concern for investors as of the moment is inflation, which could potentially hamper the earnings growth of some companies. The Philippine Statistics Authority last Friday reported that the consumer price index accelerated by 6.7% in September, bringing the nine-month average to 5%.
BPI Securities said it expects inflation to continue moving up until it peaks to around seven percent in December, bringing the full-year 2018 figure to about 5.5-5.6%.
“We think that inflation this year should be somewhere between 5.5-6% or somewhere closer, and next year somewhere closer to about 3.5%, as the growth in oil prices normalize… We have to see inflation start to normalize before 4% for the people to be a bit more comfortable,” Mr. Narvaez explained.
The continued outflow of foreign funds has also contributed to the lackluster performance of the PSEi.
As of Oct. 5, the local stock market has logged 27 straight days of net foreign selling, with a record figure of P1.42 billion in net sales for a single day. Foreign investors have recently shunned emerging markets in favor of more developed markets where they could have more stable returns.
Asked what would bring back foreign funds into the country, Mr. Narvaez said the Philippine economy would have to grow faster than 6.5% to attract more investors.
“We have to see an acceleration of growth. If we’re just going to continue to grow at maybe 6-6.5%, that may not compel investors to come back in a major way. We should see growth upwards of 6.5%,” he said.
The country’s gross domestic product (GDP) slowed to 6% in the second quarter of the year, compared to the 6.6% growth in the first quarter. A number of global institutions have already lowered their Philippine GDP forecasts for this year, including the International Monetary Fund which slashed its forecast to 6.5% from 6.7%, and the World Bank which cut its target to 6.5% from 6.7%.

CAVITEx toll fees may soon increase

TOLL RATES at the Cavite Expressway (CAVITEx) may soon rise, as Cavitex Infrastructure Corp. (CIC) is set to file its application to hike fees before the Toll Regulatory Board (TRB) within the month.
Luigi L. Bautista, president of CAVITEx private concessionaire CIC, told reporters last week the company is eyeing a 20 centavo per kilometer increase for the use of the toll road.
“We will file the petition this month. Then it will be processed. Depends on when the TRB will approve it,” he said.
The existing toll fee at the CAVITEx is P24 for the seven-kilometer stretch. A 20-centavo increase means an additional P1.40 to the toll fee, but Mr. Bautista said it will likely be rounded off.
CIC is currently working on a P1.1-billion enhancement of the CAVITEx, phase 1 of which is the P800-million widening of lanes and construction of a left-turn facility at the Marina flyover; and phase 2 the P300-million widening of bridges in Wawa, Las Piñas and Parañaque.
Mr. Bautista said they expect to complete the left-turn facility at the Marina flyover and the lane widening by the end of the month.
“We will complete it by the end of this month. So by next month, we should be… tapos na [it’s done]. And then we’ll just finish the lane widening. Siguro by the end of this month [Likely by the end of this month],” he said.
He noted the construction works are substantially complete, and the contractor just needs to address the remaining balance and “punch listed items identified by the independent consultant.”
“There’s a certificate that needs to be signed. It’s called the Certificate of Substantial Completion. Once that is signed by the independent consultant, that is the document that you need to be able to file the petition for the annual toll,” Mr. Bautista explained.
CIC is the unit of Metro Pacific Tollways Corp. (MPTC) that holds the concession for the CAVITEx project.
MPTC is the tollways unit of Metro Pacific Investments Corp. (MPIC). MPIC is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., others being PLDT, Inc. and Philex Mining Corp. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Denise A. Valdez

Dr. Martens opens Davao City branch, targets millennials


THERE IS a DDS in Davao City, and they think Dr. Martens are the killer shoes.
The Davao Docs Squad (DDS), an informal group loyal to the shoe brand, cheered the recent opening of the Dr. Martens shop at the Ayala Abreeza Mall, the 6th in the country.
Brand Manager Nadine Payumo said Philippine distributor Primer Group of Companies decided to open a branch in Davao City because of brisk sales at its two outlets.
“We found out that among the outlets in the country, those that are in Davao are the ones who sell the most number of pairs,” Ms. Payumo told BusinessWorld during the recent shop opening.
She said Davao City buyers even used to contact them online so they could get their hands on the newest designs.
DDS member Robert Bodiongan said it used to be quite frustrating not being able to readily acquire a new pair.
“At least it is easier for us to buy pairs that we like without waiting for time to travel to other places,” said Mr. Bodiongan, who confesses to having bought six Dr. Martens pairs just this year.
Ms. Payumo said the 63-square meter shop is also meant to serve “as a place where they (loyalists) can meet” and attract new clientele, particularly the so-called millennials.
“We also want to expose the brand to this (new) segment of the market,” she said. — Carmelito Q. Francisco

Manila FAME takes new directions


THE 68th Manila FAME fair is set to showcase products by more than 360 micro, small and medium enterprises (MSMEs), present innovations in the use of bamboo, and take on digitalization.
Organized by the Department of Trade and Industry through the Center for International Trade Expositions and Mission (DTI-CITEM), the event showcases Filipino creativity and craftsmanship with participating fashion, home, lifestyle brands, as well as, products from homegrown artisans in regional groups.
The country’s biannual design and lifestyle event will be held on Oct. 19 to 21 at the World Trade Center in Pasay city.
“Manila FAME stands as a platform for both small and established enterprises to penetrate the international market. The trade show provides exporters with the opportunity to meet with international trade buyers, importers, retailers, wholesalers, and merchandising agents,” DTI-CITEM executive director Pauline Suaco-Juan said in a press release.
GOING DIGITAL
At this month’s exhibit, the Artisans Village section includes fashion, home décor, gifts, and furniture products from Antique, Bohol, Cebu, Negros Occidental, Negros Oriental, Northern Mindanao, and Marawi City.
Manila FAME is also providing a digital platform for exhibitors to be accessible to buyers through an enhanced website experience when visiting the Touchpoint tab on the official website.
“What you will see is a way of telling stories in another medium that we haven’t previously done in Manila FAME, because the primary medium has always been through trade shows. We live in a digital world, we recognize that there is a need for exhibitors and buyers to keep that connection for the rest of the year,” Ms. Suaco-Juan told BusinessWorld during the press preview on Oct. 12 at the LRI Design Plaza in Makati city, noting that many of exhibitors do not have social media accounts or websites. “If the companies cannot do it on their own, then Manila FAME should be able to offer that service.”
The website provides the list of exhibitors and contact information. It highlights stories of the products through photos and videos.
BAMBOO
The Design Center of the Philippines, in partnership with the Philippine Nickel Industry Association (PNIA), explores additional applications of bamboo to showcase its versatility through the organization’s Bamboo Extreme program. Executive director of the Design Center of the Philippines, Ria Matute said that the current display focuses on bamboo and the “new concept of mobility.”
The display will include bamboo bikes for children and adults, and a pedicab.
The third edition of the Design Commune: Nude+ will showcase products of 90 companies that went under product development. Curated by Tes Pasola, the special setting covers 180 square meters with 40 tables surrounded by off-white and ivory, pale pink, and other skin-toned products that Ms. Pasola described as “color forecasts for 2019.” The showcased products will be segmented to focus on markets in Europe, the USA, and Japan.
With these innovations, Ms. Suaco-Juan hopes that the upcoming Manila FAME continues to build and strengthen the design community.
For more information, visit www.manilafame.com/. — Michelle Anne P. Soliman

Ayala Land explores partnerships with ASEAN property firms

AYALA LAND, Inc. (ALI) is in talks with a company in the ASEAN (Association of Southeast Asian Nations) region for potential partnerships in the real estate market.
“Meron na (We have one), we’re in discussions,” ALI Chief Financial Officer Augusto Cesar D. Bengzon told reporters when asked if they have a new partnership overseas, saying they are looking for a platform to grow through a company or local organization.
Mr. Bengzon declined to disclose further details, but noted the company is based in one of the 10 ASEAN countries.
“When we look at our international strategy, the focus is on ASEAN region, and potentially second tier China cities. Our preferred mode of entry is through a organizational company which will provide us the platform… You need local expertise, and therefore it’s best to partner with a local team that knows the market,” Mr. Bengzon explained.
He also added they prefer partnering with companies that already have a landbank.
This is the same strategy that ALI employed when it first planted its flag in Malaysia. The company initially purchased a 9.16% share in Malaysian firm MCT Bhd. in 2015, eventually increasing its stake to 72.31% last February. MCT is involved mainly in affordable residential condominium projects.
“We’ve installed the CEO (chief executive officer) and from what we are seeing, there are also quite a number of opportunities in Malaysia and we’re quite optimistic that the local team will be able to grow the company,” Mr. Bengzon said.
ALI acquired last April through MCT a four-hectare property in Kuala Lumpur’s Klang Valley for P2 billion. It will be transformed into a mixed use development, with 90% allotted for both horizontal and vertical residential projects. The remaining 10% will be developed into leasing spaces.
This will be MCT’s fourth project in Klang Valley, as it is also constructing Cybersouth, Cyberjaya, and One City in the area.
ALI generated a net income attributable to the parent by 18% to P13.5 billion in the first six months of 2018, as revenues likewise grew by 18% to P80.4 billion.
The company aims to hit a net income of P40 billion by 2020, or its so-called 2020 vision, with P20 billion from the residential segment and P20 billion from the leasing business. ALI would have to post a compounded annual growth rate of 17% in the next two years in order to achieve its goal.
ALI committed to spend P110.8 billion in capital expenditures this year as part of its 2020 vision, and also to take advantage of the booming residential market in the country. — Arra B. Francia

T-bills seen to fetch higher rates

TREASURY BILLS (T-bill) on offer this week will likely fetch higher rates anew as market players are still pricing in the September inflation print.
The Bureau of the Treasury (BTr) is offering P15 billion worth of T-bills at its auction today. Broken down, the government is looking to raise P4 billion and P5 billion via three- and six-month papers, respectively, and P6 billion from the one-year debt papers.
Traders interviewed over the weekend said yields on the T-bills will likely climb further from the previous offer.
The bond traders expect rates of the debt papers to climb by 10-20 basis points (bp) across all tenors from the previous auction, with one saying the offer could be just 1.25 times oversubscribed.
“Investors are still looking at the inflation as well as the possible rate hike from the BSP (Bangko Sentral ng Pilipinas),” the trader said in a phone interview before the weekend, also noting the weakening of the peso versus the dollar as another downside.
Last week, the government decided on a partial award of the T-bills it placed on the auction block, raising just P13.548 billion out of the P15 billion it wanted to borrow.
Broken down, the BTr partially awarded the 182-day T-bills, accepting offers totalling P3.548 billion versus the P5-billion program.
Meanwhile, the Treasury fully awarded the 91- and 364-day papers, raising P4 billion and P6 billion from each tenor, respectively.
The three- and six-month debt fetched 4.404% and 5.684%, respectively, while the one-year T-bills yielded 5.883%.
At the secondary market on Friday, the 91-, 182- and 364-day papers were quoted at 4.4397%, 5.5924% and 5.998%, respectively.
Inflation picked up to 6.7% in September from the 6.4% print in August and 3% in the same month last year, as typhoon Ompong (international name: Mangkhut) worsened supply issues for rice and other crops.
However, the September result fell below the 6.8% estimate by the BSP and median in a BusinessWorld poll.
The market is still pricing in inflation expectations in their decisions, saying the BSP may still need to hike interest rates further to keep local yields competitive and quell price expectations.
The central bank will hold its seventh rate-setting meeting on Nov. 15. It has raised key rates by a cumulative 150 bps since May.
The Treasury is raising P270 billion from the domestic market this year through auctions of securities, offering P180 billion in T-bills and another P90 billion in Treasury bonds.
The government plans to borrow P888.23 billion this year from local and foreign sources to fund its budget deficit, which is capped at 3% of the country’s gross domestic product. — Karl Angelo N. Vidal

Working on glasses with an eye to the future


A PAIR of eyeglasses does not only need to have accurately graded lenses, it would also be nice for it to complement your personal style and face shape.
Italian eyewear manufacturer Safilo, through its official distributor Ark Trends, Inc., launched the distribution of collections from six of its luxury brands, marking its presence in the Philippines.
“If you look at the retail business, brands are actively building their presence and this also a great opportunity to build the eyewear category. The Filipinos are more brand-focused and aware of quality,” Vincent Cleme, Safilo Group brand associate director for APAC, told BusinessWorld shortly after the launch on Oct. 11 at Manila House Private Club in BGC which saw artists drawing the faces of guests at the event.
The Safilo Group carries brands with a strong legacy in craftsmanship. Designs from its core brand, sports eyewear Carrera; and its licensed brands — Jimmy Choo, Fendi, Hugo Boss, MaxMara, and Dior — are the collections launched.
These include prescription eyewear and sunglasses with playfully constructed frames and bold colors such as pink, blue, and yellow.
According to Mr. Cleme, the Safilo Group anticipates trends and works on the eyewear collections for 18 months in advance at five design studios located around the world. Their team monitors trends not only in eyewear design but also material. “Based on that (trends), [our team] anticipates trends of eyewear of one and a half years [in the future] and then, design our collection,” he said.
“I think the easy way of picking eyewear is to go for the eyewear that everyone has,” Mr. Cleme observed. He said, however, that the rule of thumb in eyewear is to choose a design that complements your face shape.
According to Mr. Cleme, rectangular frames go well with round faces; angular frames for oval faces; people with angular jawline may opt for round frames.
Mr. Cleme said his knowledge on eyewear suitability is based on experience.
“I spend a lot of time making people try eyewear. I think I’ve reached a point where, when I see someone, then I know more or less [the pieces] in the collection which will fit the person the best,” he said. “But I never say that I would be the one to choose because at the end of the day, it should be a personal choice.”
Safilo’s eyewear collection is available at LS Pascual in Rockwell, Shangri-la Plaza Mall, Robinsons Ermita, Robinsons Magnolia, and TriNoma; Optical Works in SM Lucena, SM Lipa, Festival Mall, SM Dasmariñas, SM Southmall, SM Bacoor, Shoppesville, SM North EDSA, SM Marilao, and SM Pampanga; and George Optical in Solenad Sta. Rosa. — Michelle Anne P. Soliman

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