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AGI preparing to build train line to Uptown Bonifacio

ALLIANCE Global Group Inc (AGI) said that it is preparing for the construction of its proposed sky train, while awaiting a Swiss challenge in either April or May.
“The project is now with NEDA (National Economic and Development Authority). We are hoping to do the Swiss challenge by around April or May but we are already preparing the ground work,” AGI Chief Executive Officer Kevin Andrew L. Tan told reporters.
“We are preparing the bidding and of course we are now in coordination with various local government agencies so we hope we can start construction by fourth quarter this year, and we hope to finish by third quarter of 2021,” Mr. Tan added.
The P3.5 billion project will link Metro Rail Transit Line 3’s Guadalupe Station to Megaworld’s Uptown Bonifacio township in Taguig City, cutting travel time to five minutes for up to 100,000 commuters per day.
Mr. Tan said the company is bullish on infrastructure and real estate development, saying growth is expected for these sectors this year until the following year.
“We’re very positive. We continue to expand. We’re going to be launching three townships this year,” Mr. Tan said, without disclosing the exact locations, though he noted that one will be in Metro Manila.
“We are committed in expanding all our businesses. We are expanding our BPOs, our hotels, residential. Fundamentally, I think all these businesses have high potential for growth this year and all the way next year,” Mr. Tan said.
Megaworld is the property arm of AGI.
On Friday, AGI closed at P14.28, up 2.29%. — Reicelene Joy N. Ignacio

Qatar firm funds PHA for P15 billion, convertible to 60% stake

PREMIERE Horizon Alliance Corp. (PHA) said it signed a memorandum of agreement with Sama Global Investment for a 250 million-euro or P15-billion funding facility for several projects, the company told the stock exchange on Friday.
“The funds will be invested by PHA in real estate, tourism hospitality, tourism and infrastructure construction, power generation, financial services and other allied and related undertakings,” the company said.
The facility will have a term of nine years with a fixed interest rate of 1.25% per annum.
“In 2021, Sama Global shall have the right to convert, in whole or in part, the 250 million-euro funding into an ownership of up to 60% in PHA in accordance with foreign ownership laws and regulations,” the company said.
PHA described Sama as an investment management firm “that provides a range of investment strategies to serve a broad spectrum of client needs with headquarters in Doha, Qatar.”
“The cornerstone of Sama Global’s investment framework is its ability to see and seize opportunity and introduce future initiatives for its portfolio companies with the end in view of improving overall value of these companies,” it said.
The memorandum of agreement was signed on Jan. 17, 2019 in Doha, Qatar by Augusto Antonio C. Serafica, Jr., PHA chairman, president and chief executive officer, and Abdulla Al-Mutawaa, chairman of Sama Global Investment, along with other company officials.
PHA, which calls itself as a “countryside enabler,” has two projects in the real estate and tourism sectors.
“PHA is developing a master-planned tourism estate in Puerto Princesa City that brings together serene mountainside resorts and beach retreats through its West Palawan Premiere subsidiary,” it said.
Earlier on Friday, PHA sought a voluntary trading suspension, which the Philippine Stock Exchange approved starting at 9:30 a.m. The suspension will be lifted at 9:00 a.m. on Tuesday, Jan. 22, 2019. — Victor V. Saulon

Grab launches food delivery service in Cebu

RIDE hailing company Grab Philippines said Friday that it launched its GrabFood service in Cebu, its second market for the service.
“We are inspired to bring new food experiences and create a positive impact to the lives of more eaters, merchant-partners and delivery partners in Cebu,” Grab Philippines Head EJ Dela Vega said in a statement.
According to Grab, the GrabFood service currently has 5,000 active restaurants in its platform, with 4,000 in Metro Manila and 1,000 in Cebu. Included in these restaurants in Cebu are Rico’s Lechon and Zubochon, as well as McDonald’s and Bonchon.
“Our goal is to be the Filipino’s everyday super app to provide greater convenience to more people,” according to Mr. Dela Vega.
Grab Philippines has said that GrabFood can give habal-habal drivers more sustainable income, and the best- performing partners can earn up to dbouble the average minimum national wage. — Reicelene Joy N. Ignacio

BSP revises capital calculation method for banks

BSP
THE BANGKO Sentral ng Pilipinas (BSP) said it has modified the calculation method for capital held by banks to better reflect holdings of higher-quality instruments.
Circular No. 1027 published on Friday amended the definition of capital under the Manual of Regulations for Banks as well as the Manual of Regulations for Non-Bank Financial Institutions.
The BSP defines capital as the “total of the unimpaired paid-in capital, surplus, and undivided profits,” and that it is synonymous to unimpaired capital and surplus, combined capital accounts, and net worth.
The bank said deposits for stock subscriptions recognized as equity shall be added to capital.
The following shall also be deducted from capital: Treasury stock; unbooked allowances for probable losses — including allowances for credit losses and impairment losses — and other capital adjustments as may be required by the central bank; total outstanding unsecured credit accommodations, both direct and indirect, to directors, officers, stockholders, and their interest granted by the bank proper; total outstanding unsecured loans, other credit accommodations and guarantees granted to subsidiaries; total outstanding loans, other credit accommodations and guarantees granted to related parties that are not at arm’s-length terms as determined by the BSP.
Also included in the deductions from capital are: deferred tax assets that rely on future profitability of the bank to be realized, net of any allowance for impairment and associated deferred tax liability — provided that the excess cannot be added to net worth if the resulting figure is a net deferred tax liability; reciprocal investment in equity of other banks/enterprises, whether foreign or domestic, whichever is lower of the investment of the bank or the reciprocal investment of the other bank or enterprise; and the government counterpart equity in the case of rural and cooperative banks except those arising from the conversion of arrearages under the BSP rehabilitation program.
The BSP said that the new circular will “ensure that capital is only composed of instruments that are of highest quality to absorb losses.”
“Prior to said issuance, the composition of accounts considered as capital for purposes of determining net worth and the capital adequacy ratio (CAR) slightly differ. On the one hand, net worth is being used to determine compliance with minimum capital levels as prescribed under Circular No. 854,” Deputy Governor Chuchi G. Fonacier said on Friday via text.
“On the other hand, CAR is a more risk-sensitive measure of a bank’s solvency position that is expressed as a percentage of qualifying capital to risk-weighted assets. CAR is aligned with international standards on capital measurement. The issued guidelines align, to the extent possible, the composition of capital accounts for purposes of determining net worth with that being used for determining CAR,” she added.
Based on the BSP’s Manual of Regulations for Banks, lenders are required to have a minimum capitalization depending on the number of branches and their location. Universal banks have a P3 to 20 billion minimum capitalization requirement; commercial banks P2 to 15 billion; thrift banks P200 million to P2 billion; and rural and cooperative banks P10 to P200 million
Quasi-banks meanwhile are required to have a minimum capital of P300 million, and trust corporations P100 million.
The risk-based capital adequacy framework sets minimum capital ratios of 6% on the Common Equity Tier 1 (CET1) ratio, 7.5% on the Tier 1 ratio and 10.0% on the Total Capital Adequacy Ratio (CAR). — Elijah Joseph C. Tubayan

RCBC prices P15 billion peso green bond issue at 6.7315%

RIZAL Commercial Banking Corp. (RCBC) said it priced its first peso “green bond” at 6.7315% per annum, with the proceeds to be used to support projects that are environment-friendly and promote resiliency to climate change.
In a regulatory filing on Friday, the bank said it will offer P15 billion via 1.5-year “green bonds,” which will mature in 1.5 years.
The public offer period will run from Jan. 21-25.
The bonds are expected to be listed at the Philippine Dealing & Exchange Corp. on or around Feb. 1.
“The bank is grateful for the overwhelming support from its institutional investors, with the books being more than three times oversubscribed from its announced issue size of P5 billion, allowing an issue size of P15 billion,” RCBC Senior Executive Vice-President and Treasurer Horacio E. Cebrero III was quoted as saying in the statement.
RCBC announced on Monday the establishment of a green finance network which will support future fund-raising activities for environment-related projects.
The funding framework is first in the Philippines to be aligned with the Association of Southeast Asian Nations (ASEAN) Green Bond Standards 2018 by the ASEAN Capital Markets Forum, the bank said.
Mr. Cebrero added that the proceeds from the issue will will be used to support RCBC’s expansion and initiatives in the green space.
In particular, the proceeds will be allocated to fund and refinance loans issued for renewable energy, green buildings, clean transportation, energy efficiency as well as pollution prevention and control.
RCBC tapped Hongkong and Shanghai Banking Corp. as the arranger of the issue. It will be joined by ING Bank N.V. Manila branch, which will also act as the sole green structuring adviser for RCBC’s green finance framework.
RCBC Chief Executive Officer Gil A. Buenaventura said in an earlier disclosure that the bank affirms its commitment to support environmental sustainability.
Domestic banks have been slowly venturing into the green financing market.
In the previous years, BDO Unibank, Inc. and China Banking Corp. raised $150 million each by issuing green bonds to sole investor International Finance Corp.
RCBC posted a P3.2-billion net profit in the first nine months of 2018, down 5.9% from a year earlier. The country’s 10th biggest bank operated 509 branches and 1,593 automated teller machines nationwide at the end of September.
RCBC shares were unchanged at P27. — Karl Angelo N. Vidal

Under half of non-life firms still far from meeting capital norms — IC

THE Insurance Commission (IC) believes some non-life insurance companies may not be able to meet the increased statutory solvency requirements by the end of the year, and encouraged such firms to seek investors or merge with other companies.
In a speech during the IC anniversary banquet on Friday, Insurance Commissioner Dennis B. Funa said that compliance with the statutory and regulatory solvency requirements is the “the most difficult of those challenges” the industry is currently facing, especially in regard to minimum net worth and risk-based capital ratios.
He said he is “concerned” that some non-life insurers are “still far off” from the P900-million minimum required capital which was upgraded this year.
“The numbers are still significant, so [there is a] sizeable number of insurance companies still far from the P900 million,” he told reporters in an interview.
He estimated that out of the 54 non-life insurers in operation, “20 something” are still far from meeting the increased solvency requirements.
According to Republic Act No. 10607, insurance companies are required to increase their net worth to P900 million by the end of 2019, from the current P550 million.
This will be further increased to P1.3 billion by the end of 2022.
Mr. Funa added that insurers would have until the end of the first quarter of 2020 to comply with the increased minimum net worth requirements, as their full-year financial statements will still be subject to review by that time.
“I don’t want to speculate. I’m hopeful that all of them will be able to come up with the P900 million… But of course, you have to be realistic that… some of them will not be able to comply with the [minimum] P900 million net worth.”
“We are encouraging them to find investors and I think that is what most of them are doing now,” Mr. Funa said.
“So far, there are those who are merging and some are in talks,” he added, although he noted that very few insurers are currently in merger talks.
Despite this, the IC said there will be some flexibility in terms of implementing the statutory requirements, especially if the companies indicate that there are plans for a merger or capital infusion.
“We will not be ironclad strict that on this day and time, we will shut down the insurers, because if we place them under conservatorship, we will have to determine if they can be rehabilitated or not,” the commissioner said.
Last year, the regulator shut down the operations of five non-life insurance firms: First lntegrated Bonding & lnsurance Co., Inc., Investors Assurance Corp., Metropolitan lnsurance Co., lnc., Plaridel Surety & lnsurance Co., and Premier lnsurance & Surety Corp., after the firmsfailed to comply with with the capital requirements.
The five firms were placed under conservatorship, which means that these companies are not allowed to sell new insurance products but will continue to process and pay for valid claims. — Karl Angelo N. Vidal

BDO rated ‘most reputable’ bank in Kantar study

BDO Unibank, Inc. was named the country’s “most reputable” bank in 2018, following a study conducted by Kantar TNS.
The research agency said according to the results of its 2018 Corporate Reputation study, BDO overtook Metropolitan Bank & Trust Co. (Metrobank) and Bank of the Philippine Islands (BPI) as the “most reputable” lender in the Philippines in 2018.
The study, which was conducted among 800 class ABC respondents from the Greater Manila Area (GMA) and Metro Cebu, is a follow-up to a survey conducted in 2008, which Metrobank topped.
The corporate reputation model of Kantar TNS focuses on five dimensions — overall reputation/renown, favorability, trust, success, as well as product and service quality.
BDO was rated first in the overall reputation ranking and was highly regarded among Metro Manila respondents, with a score of 90% in 2018, up from 79% 10 years earlier.
The increase in bank’s reputation over the 10-year period was mainly attributed to the “success” metric after it gained dominance in the domestic market while expanding its network globally, the research agency said.
Aside from this, Kantar TNS added that big gains in “product and service quality” also lifted the reputation of BDO.
Meanwhile, BPI and its thrift banking arm BPI Family Savings Bank placed second in both Metro Manila and Metro Cebu, with its overall reputation score at 73% in 2018, down from 80% 10 years earlier.
Metrobank likewise saw a decline in its overall reputation to 73% from 2008’s 84%, even as it managed to take the lead in Metro Cebu.
“Trust, favorability, and product and service quality [were] the factors pulling down the scores for both banks,” Kantar TNS added.
In particular, the respondents said that BPI should focus on “[b]eing a bank that customers feel comfortable to deal with, is well-managed, and has comfortable bank premises,” as these areas perceived to be the strengths of the lender when the survey was last conducted.
Meanwhile, the respondents suggested that Metrobank should improve its 24/7 customer service to provide easy access to funds, after having been first in reputation in 2008.
Completing the top five list are the government-owned Land Bank of the Philippines (LANDBANK) and Philippine National Bank (PNB).
Kantar TNS also cited Rizal Commercial Banking Corp. and its savings banking subsidiary RCBC Savings Bank, as well as Security Bank Corp., as having made major gains in reputation over the ten-year period.
“Consumers are taking notice of efforts to consolidate and strengthen the banking industry,” Kantar TNS Head Jose Villabroza was quoted as saying in a statement.
At the end of September, BDO was the country’s biggest bank in asset terms with P2.79 trillion. It was followed by Metrobank (P1.79 trillion), LANDBANK (P1.77 trillion), BPI (P1.7 trillion) and PNB (P843.33 billion). — Karl Angelo N. Vidal

Peso weakens amid uncertainty over Brexit, US gov’t shutdown

THE peso declined further against the dollar on Friday due to continued concerns over the UK’s exit from the European Union as well as the partial US government shutdown.
The peso ended the week at P52.515 versus the greenback, down from the P52.41-per-dollar finish last Thusday.
The peso opened the session stronger at P52.40, hitting a high of P52.35 intraday. It was weakest at P52.55.
Trading volume thinned to $807.22 million from $932.22 million the previous day.
A foreign exchange trader said the peso slid further as the strong momentum for the dollar persisted.
“We closed above the P52.50 level, which is significant because it is a strong resistance level,” the trader said in a phone interview.
He added that the peso moved lower again even as market players piled up their remittance coverage for the weekend.
“Still, market factors remain headline-driven such as the Brexit deal and the shutdown of the US government.”
On Wednesday, British Prime Minister Theresa May won a confidence vote in Parliament after the chamber rejected her proposed Brexit deal with the EU. The rejection of the plan means she can remain in place to negotiate a better deal with the EU, though the prospects that the EU will budge are slim.
Meanwhile, the US government shutdown, the longest in recent history, is still ongoing, even as US President Donald J. Trump enacted a law on Wednesday granting some 800,000 federal employees back pay.
Ruben Carlo O. Asuncion, UnionBank of the Philippines chief economist, said the “perception that the US economy is doing well” drove the dollar’s ascent.
“Optimism about world trade might have also weighed in,” Mr. Asuncion added, citing the recent developments in the US-China trade talks. — Karl Angelo N. Vidal

Bourse extends gains to nine-month peak

By Janina C. Lim, Reporter
THE MAIN INDEX ended Friday at a nine-month high as heavyweights continued to rally, returning above 8,000 and marking the second straight day and third consecutive week of gains.
The Philippine Stock Exchange index rose 1.51% or 119.92 points to close at 8,407.12 — up 1.81% from Jan. 11’s 7,904.09 finish — while the broader all-shares index edged up 1.28% or 61.08 points to end 4,804.92.
“Our index ended strong today after index heavyweights such as SM, SMPH, JFC rallied by more than two percent,” Timson Securities, Inc. Trader Jervin S. De Celis in a mobile phone message on Friday, referring to SM Investment Corp’s 2.41% rise to P976 apiece; SM Prime Holdings, Inc.’s 2.87% climb to P39.40 and Jollibee Foods Corp.’s 3.77% surge to P324.80 each.
“This could be due to BSP’s inflation outlook for 2019 and 2020 which is expected to settle at 3.2% and 3.0% respectively. The central bank and other private economists expect this year that soaring prices last year will slow down so I guess that… helped the index reach a nine-month high.”
Regina Capital Development Corp. Managing Director Luis A. Limlingan said that stocks may have also been propped up by hopes of eased trade tensions between the United States and China.
“Philippine shares crossed over the 8,000 mark yet again, just as US stocks went on a three-day win streak on Thursday. This came after The Wall Street Journal reported that the Trump administration was debating whether to ease tariffs on Chinese imports in a bid to calm markets and ease tensions with Beijing,” Mr. Limlingan said in a separate text message.
Hopes of a resolution to the Sino-US trade row boosted major Wall Street indices, with the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite index gaining 0.67%, 0.76% and 0.71%, respectively on Thursday.
Major Asian bourses took heart, with Japan’s Nikkei 225 and TOPIX index, the Shanghai SE Composite, Hong Kong’s Hang Seng Index and South Korea’s KOSPI Index following suit with increases of 1.29%, 0.93%, 0.75%, 1.25% and 0.82%, respectively.
All six sectoral indices at home ended with gains, led by holding firms (151.94 points or 1.93% to 8,003.19), followed by industrials (192.61 points or 1.68% to 11,650.85), property (60.12 points or 1.51% to 4,017.35), services (19.9 points or 1.29% to 1,560.13), financials (6.4 points or 0.35% to 1,815.63) as well as mining & oil (18.54 points or 0.21% to 8,821.77).
Stocks that gained outnumbered those that lost 111 to 76, while 59 others ended flat.
Only two of Friday’s 20 most active stocks lost, namely: Manila Electric Co. which dropped 2.33% to P369.20 apiece and LT Group, Inc. which shed 0.66% to P15.10 each.
The same list showed Ayala Land, Inc. and Metropolitan Bank & Trust Co. flat at P45 and P82.50, respectively.
Friday saw 1.855 billion shares worth P8.435 billion change hands, compared to Thursday’s 1.216 billion shares worth P14.165 billion.
Foreigners remained predominantly bullish for a second straight day, although their net purchases dropped 66.28% to P1.297 billion from Thursday’s P3.845 billion.

Gov’t imposes cement safeguard duty

THE DEPARTMENT of Trade and Industry (DTI) will impose a provisional safeguard duty on imported cement starting next month, citing the need to prevent putting local producers at a disadvantage.
“With the elements of surge and injury clearly established, DTI is mandated to impose a safeguard duty. DTI is thus imposing a provisional safeguard duty of P8.40 per [40 kilogram] bag, equivalent to about four percent,” Trade Secretary Ramon M. Lopez told reporters in a mobile phone message on Thursday, even as his department noted in a separate statement that cement “is a critical input to infrastructure.”
The administration of President Rodrigo R. Duterte has been implementing a more aggressive infrastructure development program in order to prod overall economic growth to a higher 7-8% clip up to 2022, when he ends his six-year term, from a 6.3% average in 2010-2016.
Citing findings of the investigation, he noted that imported cement surged to more than 3 million metric tons (MT) in 2017 from just 3,558 MT in 2013, while the share of imports by non-manufacturers or “pure” traders increased to 15% from only 0.02% during the same four-year period, he noted.
“Equally important, the industry experienced a sharp decline in income (earnings before interest and taxes) of 49% in 2017,” Mr. Lopez said.
The DTI asked cement manufacturers to maintain their current retail prices, saying it “will closely monitor the selling price of cement manufacturers and ensure that they will not implement increases.”
The order, will take effect Feb. 8, or 15 days after publication in two dailies which Mr. Lopez said is expected today. The safeguard duty will be in effect for 200 days. Mr. Lopez added that DTI has yet to relay its order in writing to the Department of Finance and the Bureau of Customs as the latter will issue the guidelines that will clear the way for actual imposition of the safeguard duty.
Sought for comment, Cristina S. Ulang, First Metro Investment Corp. head of research, said in a mobile phone message that the move would be “[g]ood for the cement companies”, explaining that it “will help them recover.”
She also cited “[p]ositive impact for ‘Build, Build Build’ as it will assure local cement industry financial viability and cement supply reliability by virtue of a level playing field for all local players and imported cement.”
Under Republic Act 8800, or the Safeguard Measures Act of 2000, a provisional duty is imposed under “critical circumstances where a delay would cause damage which would be difficult to repair, and pursuant to a preliminary determination that increased imports are a substantial cause of, or threaten to substantially cause, serious injury to the domestic industry.”
The tariff will be paid in the form of a cash bond that will be deposited with a government bank “while the Tariff Commission undertakes and concludes its formal investigation” within 60-120 calendar days.
Cement importers have opposed the P8.40 per bag tariff, arguing that they earn P8.25 profit from selling a bag of cement.
The Philippine Cement Importers Association, Inc. on Wednesday warned of a possible shortage should the safegard duty push through, saying that even local manufacturers have themselves been importing to fill supply gaps and accounted for about 36% of total cement imports in 2018.
Despite warnings of the new duty’s possible impact on the government’s infrastructure push, Mr. Lopez assured of sufficient supply, noting that domestic capacity amounts to 35 million MT a year against current demand of 25 million MT.
The Trade chief cited the need to increase capacity, given continuous growth of demand which is expected to double by 2025.
He encouraged existing and new players to build additional plants to ensure stable supply in the long-run.
“But relying solely on imports and being at the mercy of global supply and demand situation is risky and irresponsible considering changes in global demand and supply conditions, and will only lead to too much dependence on imports, leading to perennial trade deficit,” Mr. Lopez added. — Janina C. Lim

Hot money turns around in 2018

By Melissa Luz T. Lopez
Senior Reporter
MORE FLIGHTY FOREIGN FUNDS entered the Philippines in 2018, beating the central bank’s expectation of a net outflow as investor optimism rebounded just before the year ended.
December saw $278.11 million in foreign portfolio investments net inflows, marking the second straight month of net inflows even if it was less than November’s $832.07 million and the year-ago $456.93 million, the Bangko Sentral ng Pilipinas (BSP) reported on Thursday.
These investments are referred to as “hot money,” as these funds enter and leave the country with ease.
Foreigners invested $1.58 billion for the month, but this was offset by $1.302 billion in withdrawn funds.
The December figure brought the full-year total to a $1.204-billion net inflow, marking a turnaround from 2017’s $195.4-million net outflow.
This is the biggest hot money inflow recorded since 2013, which saw $4.225 billion foreign funds retained in the local economy.
Last year’s net inflow even beat the $100-million net outflow expected by the central bank.
“This may be attributed to the large investment in a holding company… accompanied by investors’ optimism over the passage of the first phase of the government’s tax reform program,” the BSP statement read.
San Miguel Corp. raised P39.19 billion (about $744 million) in fresh capital in November through a follow-on offering for its subsidiary, San Miguel Food and Beverage, Inc.
On the other hand, the Tax Reform for Acceleration and Inclusion law took effect Jan. 1, which reduced personal income taxes while raising more revenues from additional levies on fuel, cars and sugar-sweetened drinks, to name a few.
Total inflows reached $16.034 billion this year, partly offset by $14.83 billion in outbound funds.
The largest inflows were recorded in the first quarter at $5.1 billion, which saw big-ticket share sales from Petron Corp. at roughly $500 million as well as a $400-million tender offer by port operator International Container Terminal Services, Inc.
About 71.4% of portfolio flows went to shares of listed companies, involving transactions that yielded net outflows worth $1.3 billion.
Foreign investors placed a fifth of their bets on peso-denominated government securities, which yielded a $1.2-billion net inflow. Other peso-denominated debt papers fetched $1.3 billion worth of investments, while peso time deposits received less than $1 million.
The United Kingdom, United States, Singapore, Netherlands and Hong Kong were the five biggest sources of hot money in 2018, while 78.8% of the outflows went to the US as investors regard it as safe haven.
Jonathan L. Ravelas, chief market strategist at BDO Unibank, Inc. pointed out that the hot money flows mirrored the movement of the Philippine Stock Exchange, coming from a roughly “10-month rout” for emerging markets.
“Eventually, the stock market recovered from the lows of the year and ended higher,” Mr. Ravelas said in a telephone interview when asked for comment.
Local financial markets took a beating last year as the Philippines reeled from surging inflation, which pushed yields up and sentiment down.
Michael L. Ricafort, economist at the Rizal Commercial Banking Corp., also noted that portfolio flows started to improve in November as inflation had “already started to ease from the near-decade high of 6.7%. Interest rates have also eased, with bond yields now on a decline.”
“Philippine economic and credit fundamentals remained solid, as partly attested by the affirmation of the country’s credit ratings as well as economic growth at six-percent levels in 2018 — among the slowest in three years partly due to higher inflation, but still among the highest/fastest in Asia/ASEAN — a sign of resilience,” Mr. Ricafort said.
BDO’s Mr. Ravelas also noted that 2019 will likely turn out to be a better year in terms of attracting more investments, saying: “With the stock market closer to 8,000 and the peso at the low-P52 level, it shows that you’ve seen the risks in 2018.”
“The water in the river is clear, investors are now willing to jump in.”
The BSP forecasts a $200-million net outflow for 2019, according to projections adopted in November last year.

Tax bureau lines up priorities for this year

THE BUREAU of Internal Revenue (BIR) has laid out its priority programs for attaining its P3.018-trillion collection goal for this year.
Revenue Memorandum Circular 5-2019 spelled out 19 priority programs to help the bureau achieve its revenue target.
Items on the list included implementation of the fuel marking program, part of Republic Act No. 10963 — or the Tax Reform for Acceleration and Inclusion (TRAIN) Act — that was not implemented even as the law itself took effect a year ago; optimization of the Internal Revenue Integrated System (IRIS); the TRAIN law Implementation Program; and implementation of RA 11032, or the Ease of Doing Business and Efficient Government Service Delivery Act.
“These priority programs are comprised of continuing priority programs from the previous year, and new undertakings, taking into account current developments in tax administration, such as the passage of the next phase of the Tax Reform Acceleration and Inclusion program, and the ongoing institutionalization of the various policies and guidelines in support of Republic Act No. 11032… and Republic Act No. 10173 (Data Privacy Act), as well as the results of the BIR Strategic Planning Sessions participated in by the Bureau’s top officials,” the circular read.
“All Bureau offices are therefore enjoined to align their activities and projects to the CY (collection year) 2019 Priority Programs, to ensure the achievement of the BIR’s CY 2019 Collection Target and the fulfillment of the Bureau’s mandate.”
The BIR raked in P1.801 trillion as of November, 11% more than the P1.621 trillion recorded in 2017’s comparable 11 months. That was 88.15% of the P2.043-trillion downward-adjusted 2018 revenue target.
This year’s target is 47.72% greater than that of 2018.
The BIR will draw up implementing guidelines for the marking of locally refined fuel and the testing of the presence of the markers in fuel stations nationwide.
Finance Undersecretary Antonette C. Tionko said on Friday last week that the Finance department expects the fuel marking program — designed to curb fuel smuggling — to be launched next month.
“For the fuel marking, the team that’s doing it is actually going already to the refineries. So that’s ongoing now. Hopefully by next month, February first week, we will launch it already,” Ms. Tionko said on Monday.
The delayed implementation of the fuel marking program, as well as the electronic invoicing and e-sales reporting — both initially scheduled for 2018 — were the reasons for the P26-billion downgrade of the overall 2018 revenue target to P2.846 trillion.
Moreover, the tax bureau seeks to pilot its electronic tax information system IRIS in the Makati City Revenue Region and the Large Taxpayers Service.
The BIR will also implement the Ease of Doing Business law, which shortens transaction processing time in transactions, as well as a single-window policy in the processing of applications of new business registration at revenue district offices (RDO).
The revenue agency will also ensure “strict compliance with new tax policies and tax payments/remittance system” under the TRAIN law, and at the same time “clarify certain issues raised in the implementation of the TRAIN law by issuing the appropriate revenue issuance.”
Other continuing programs to attain BIR’s collection targets include: imposing sanctions on delinquents via the Run After Tax Evaders and the Oplan Kandado program; intensified audit and investigation; enhanced implementation of the Arrears Management Program in the Regional Offices; broadening of the tax base by five percent; increase tax compliance by five percent through the Tax Account Management Program; implementation of the e-invoicing and e-sales reporting; massive tax education campaign; information and communications technology solutions for improved taxpayers service; sustained compliance with the Data Privacy Act; data sharing agreements with other government agencies; action on administrative cases against erring revenue officials and employees; expedite recruitment of new personnel and promotion of qualified employees; capacity building enhancements for BIR officials and employees; and the 100% utilization of budget appropriations. — Elijah Joseph C. Tubayan

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