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Peso strengthens ahead of BSP decision

THE PESO continued to strengthen against the dollar on Thursday as market participants awaited the policy decision of the local central bank.
The peso closed at P52.62 versus the greenback on Thursday, stronger than the P52.715-per-dollar finish logged on Wednesday.
The peso traded stronger the whole day, opening the session at P52.60 per dollar. It went to as high as P52.575, while its intraday trough was at P52.65 versus the US currency. Dollars traded slid to $697.65 million from $765.15 million on Wednesday.
A foreign exchange trader said the peso traded within a tight range yesterday ahead of the policy statement of the Bangko Sentral ng Pilipinas (BSP) late Thursday.
“The peso traded in a tight range ahead of the BSP announcement. Near the close, we saw agent banks lifting the offer, so it closed near the intraday [low],” the trader said in a phone interview.
The central bank kept its benchmark rates steady during its last policy meeting for the year, ending the streak of five consecutive hikes this year.
The BSP’s key overnight borrowing rate remains at 4.75%. Meanwhile, the overnight lending and deposit rates stood at 5.25% and 4.25%, respectively.
The Monetary Board noted that latest inflation forecasts show a lower path over the policy horizon, as the recent reading shows signs of tapering price pressures.
Inflation stood at 6% in November, slower than the nine-year peak of 6.7% recorded in October and September.
BSP Assistant Governor Francisco G. Dakila, Jr. said the central bank now expects monthly inflation to go back below 4% at the end of first quarter of 2019, well within the government’s 2-4% target band.
The central bank raised rates by 175 basis points since May.
“As rates were unchanged, it would somehow put a support on the dollar-peso, so we can see a continued weakness in peso,” the trader said, noting that the movement for today will “not be that much” given that the central bank is widely expected to keep their policy rates steady.
On the other hand, another trader said the local unit sustained its strength amid less safe-haven demand for the dollar due to “improving US-China trade negotiations and weak US inflation data.”
For today, the first trader expects the peso to trade between P52.55 and P52.70, while the other gave a P52.50-P52.70 range. — K.A.N. Vidal

PSEi extends gains on US-China trade war bets

LOCAL EQUITIES extended gains on Thursday on hopes that the United States and China will resolve their trade dispute.
The 30-member Philippine Stock Exchange index (PSEi) firmed up 0.46% or 34.68 points to finish at 7,522.92, closing on a positive note for the third straight session. The broader all-shares index likewise added 0.28% or 12.78 points to 4,507.33.
“The continued optimism that the US and China may be able to find a way to resolve their trade war has had a positive effect on global equities markets including here in the PSE,” Eagle Equities, Inc. Research Head Christopher John Mangun said in an e-mail.
“The PSEi sustained its positive momentum from yesterday and if it can keep on its path, it may end above 7,500 for the week.”
The local market has been mirroring the performance of global indices in previous weeks, closely watching the developments of the US-China trade war.
The Dow Jones Industrial Average advanced 0.64% or 157.03 points to 24,527.27. The S&P 500 index rose 0.54% or 14.29 points to 2,651.07, while the Nasdaq Composite index also rallied 0.95% or 66.48 points to 7,098.31.
Meanwhile, Regina Capital Development Corp. Managing Director Luis A. Limlingan noted that investors were also awaiting the result of the Bangko Sentral ng Pilipinas’ (BSP) last policy meeting for the year.
“Investors are also betting on the outcome of the BSP wherein more are inclined that our central bank will apply the brakes this time with respect to interest rates,” Mr. Limlingan said in a mobile message.
The central bank kept its benchmark rates steady during its last policy meeting for the year, ending the streak of five consecutive hikes this year.
The BSP’s key overnight borrowing rate remains at 4.75%. Meanwhile, the overnight lending and deposit rates stood at 5.25% and 4.25%, respectively.
“Our view is that headline inflation has peaked and should continue to decelerate due to favorable base effects, legislated measures that aim to resolve food supply shortage issues, the suspension of fuel tax hikes, and lower global energy prices,” Mr. Limlingan explained.
Four sectoral indices climbed, led by financials which jumped 1.27% or 22.52 points to 1,788.11. Services followed with a 1.06% uptick or 14.87 points to 1,412.36. Holding firms rose 0.53% or 39.84 points to 7,444.88, while industrials went up 0.34% or 37.15 points to 10,876.94.
In contrast, the mining and oil counter lost 0.86% or 72.58 points to 8,280.58, while property shed 0.38% or 13.94 points to 3,648.62.
Turnover was halved to P6.09 billion from the previous session’s P11.90 billion, with 2.70 billion issues switching hands
Advancers outnumbered decliners, 109 to 80, while 46 names were unchanged.
Foreign investors turned buyers, booking net purchases of P324.84 million against Wednesday’s P984.70 million worth of net sales. — Arra B. Francia

Aces, Hotshots brace for another fierce encounter

By Michael Angelo S. Murillo
Senior Reporter
THEIR best-of-seven Philippine Basketball Association Governors’ Cup finals series now levelled at two games apiece, the Alaska Aces and Magnolia Hotshots Pambansang Manok brace for another intense encounter when they collide in Game Five today at the Smart Araneta Coliseum.
Back to square one after the Aces pulled even in the series with a 90-76 victory in a highly emotional and rough Game Four on Wednesday, the two teams now buckle down in trying to notch the key victory that would put them just a win away from the title of the season-ending PBA tournament.
Game Four was so physical that Alaska coach Alex Compton could not help but vent out his dismay and concern over the roughness in the series going overboard after seeing some of his players sprawled on the court hurt in various instances.
“Somebody punched [import] Mike [Harris] in the testicles and somebody hit Chris Banchero on the male part. Those are literally low blows and I’m not happy about it,” said a fuming mad Compton at the postgame press conference following Game Four.
“At what point will the referees make the calls. I hope it would be in the next game so we can start playing real basketball,” added Mr. Compton.
For his counterpart at Magnolia, Chito Victolero, the issue on physicality is being overblown by their opponents and highlighted that the two teams are just playing hard.
“The players are just playing hard. I don’t see anything wrong with that. We just have to stay tough,” said Mr. Victolero, who saw his team lose the 2-0 cushion it had in the finals after back-to-back losses.
“Let the referees decide the calls. As coaches it’s not our duty to make them,” added the Magnolia coach, whose import Romeo Travis left the game momentarily in the third period in the last game after absorbing a cut on the bridge of his nose.
In Game Four, Alaska showed grit and determination anew to hang on for the win.
Magnolia had early control of the contest only for Alaska to pick it up as the match progressed and never let up thereafter despite serious headways made by the Hotshots.
Mr. Harris, the best import awardee, led the Aces with 34 points and 22 rebounds while Mr. Banchero added 17 points, six rebounds and five assists.
The Hotshots, meanwhile, was led by Mr. Travis with 29 points and 13 boards with Paul Lee, the best player of the conference, finishing with 14 points.
Despite losing their series lead, Mr. Victolero said they are nonetheless ready for the coming games.
“We expected a long series. We have to stay ready and positive and play as a group the rest of the way,” he said.
For Mr. Compton, with the Aces gaining momentum after back-to-back wins, they just have to stay the course.
“I’m proud of my players for keeping their composure despite the physicality. We just have to continue keeping our focus and playing our game,” he said.
Game Five of the finals is set for 7 p.m.

Petron, F2 Logistics dispute PSL All-Filipino title

By Michael Angelo S. Murillo
Senior Reporter
FAMILIAR foes Petron Blaze Spikers and F2 Logistics Cargo Movers get tangle again as they dispute the 2018 Philippine SuperLiga (PSL) All-Filipino crown beginning this weekend.
A best-of-three affair, the All-Filipino finals tiff, with Game One set for Saturday at the Mall of Asia Arena at 6 p.m., marks the fifth straight time that Petron and F2 Logistics are meeting in the championship of the PSL.
The two have split their four previous encounters in the finals, making the about-to-start championship joust a tiebreaker in their rivalry.
Defending champion Petron and F2 Logistics dominated the first two rounds of the tournament and continued to lord it over in the playoffs.
The Blaze Spikers completed their return to the championship by defeating the Cignal HD Spikers in straight sets in the semifinals on Tuesday, seeing no need to make use of their twice-to-beat advantage.
The Cargo Movers also did the same, eliminating the Generika-Ayala Life Savers in an exciting five-setter in their own semifinal encounter to set a rematch with Petron.
Meeting in the finals once again, both the Blaze Spikers and Cargo Movers are expecting no less than a competitive matchup with the teams seeking to get the better of the other.
“Our win over Petron depends on the hunger and willingness of my players,” said F2 Logistics head coach Ramil de Jesus in the lead-up to the finals.
“Our battle against them always goes down the wire. It won’t be easy. That’s why we will use the next few days to polish our game and prepare against them,” he added.
For Petron, the lone undefeated team to date in the ongoing tournament, it said it cannot rest and be complacent, especially against a team like F2 Logistics.
“They’re on a roll. We have to do our homework and prepare for them because it’s really hard to stop a squad that is reaching its peak. The finals will be anybody’s ball game,” said Blaze Spikers coach Shaq Delos Santos.
In their lone encounter in the preliminary round of the tournament, Petron topped F2 Logistics in four sets, 22-25, 25-16, 25-16 and 25-20.
Bannering the Blaze Spikers in their repeat bid are Mika Reyes, Aiza Maizo-Pontillas, Rhea Dimaculangan, Ces Molina, Bernadeth Pons, Remy Palma and Sisi Rondina, among others, while the Cargo Movers will be relying on the likes of Cha Behag, Aby Marano, Kim Kianna Dy, Kim Fajardo, Ara Galang, Majoy Baron, and Dawn Macandili.
In last year’s finals, Petron swept F2 Logistics in their best-of-three finals with Ms. Maizo-Pontillas winning most valuable player in the championship.

Allianz Conquer Challenge:Promoting growth and social inclusion through OCR

COMMITTED to promoting personal growth and development as well as social inclusion, global insurer Allianz continues to find ways to get the message across through various programs and activities.
Recently Allianz held the third leg of the Allianz Conquer Challenge, this time aiming to celebrate the strength of indigenous people, particularly the Aetas of Porac, Pampanga, through the rising sport of obstacle course racing (OCR).
Held on Dec. 9 at the Clark Global City in Pampanga, the challenge saw some 20 Aetas, between 16 to 21 years old, race together with 20 Allianz employees in the pairs category.
Company officials said one of the purposes of the event was to inculcate to indigenous people the value of committing to achieving goals, which is being highlighted in OCR challenges.
“We recognize the strength of the Aetas. So, aside from educating them with the basics of personal finance through our financial literacy program, we would like to impart to them the value of committing to achieve goals that they have to set. We want to give them a fair chance of having employment opportunities in the future,” explained Gae Martinez, chief marketing officer, Allianz PNB Life, as to their goals for their program.
Sunday’s race was a 10-kilometer race composed of 25 obstacles, which was the same trail tackled by professional racers who competed for a slot in the next Southeast Asian Games, which incidentally is set to take place here in the Philippines.
Some of the obstacles during the race were hurdles, taho (beancurd) carry, tirador (slingshot), spider web, monkey bars, wall of tire, slip wall and commando climb, among others. Those who incurred penalties for not being able to perform an obstacle had to carry a 30-pound sand bag.
“OCR is an up-and-coming sport. It is gaining popularity in the Philippines. Allianz as a company uses sports to connect with communities. The Aetas from Villa Maria is one of the communities that Allianz here in the Philippines has chosen to support. This is, in line with our advocacy to promote social inclusion, one of the pillars of our company’s Corporate Citizenship Strategy,” Ms. Martinez said.
And this push of the company was seemingly not lost to the indigenous people who participated in the event, viewing it as something to take cue from for them to pursue their dreams and improve themselves.
“They carry sand bags here. In the mountains, we carry 50 kilos of kamote (sweet potato) or ube (purple yam) that we bring to the lowlands. If we sell, our families will have money to spend. By joining the race, I can tell people that I have a dream, too. I want to work in IT (information technology). I hope I can continue after I graduate,” said Reyna Baclay, who at age 18 is still a grade nine student, in the vernacular after completing the race.
Holding another successful staging of the Allianz Conquer Challenge, Ms. Martinez said they are all the more determined to see their cause through and going.
“Allianz is here to provide the courage to move forward, the courage to overcome life’s obstacles, for them to have better life,” Ms. Martinez said. — Michael Angelo S. Murillo

Mavericks dump Hawks

HARRISON Barnes scored 25 points and the Dallas Mavericks extended their winning streak to three games with a 114-107 victory over the visiting Atlanta Hawks.
The win also broke the team’s 10-game losing streak to the Hawks, a stretch that began Oct. 30, 2013. Dallas is now 5-1 in December.
Barnes, who was out with a hamstring injury when the teams met in October, was 8-for-16 from the floor and 5-for-8 on 3-pointers. The Mavs are now 6-1 when Barnes scores 20 points.
The Mavs also got 24 points from rookie Luka Doncic, who was 12-for-15 from the line and added 10 rebounds and six assists. It is the 13th time he has scored 20 or more points.
J.J. Barea came off the bench to add 18 points, including three 3-pointers. Dorian Finney-Smith added 11 points and six rebounds.
Atlanta got a double-double from John Collins for the fifth straight game. The second-year forward had 20 points, shooting 10-for-22, and grabbed 17 rebounds.
The Hawks also got 22 points and five rebounds from Kent Bazemore and 24 points and 10 assists from rookie Trae Young. Rookie Kevin Huerter scored a career-high 19 points.
Barea put the Mavericks ahead to stay when he drained a 3-pointer with a minute left in the third quarter. That sparked a 24-9 run that carried over into the fourth quarter and helped Dallas put the game away.
Both teams took turns holding the lead in the first half. The Mavericks led by as many as eight points before the Hawks came back to grab the lead in the second quarter and take a 52-51 lead into halftime.
The teams split their two-game series. The Hawks won the first meeting on Oct. 24 in Atlanta.
The Hawks continued to play without Jeremy Linn (sore back), Omari Spellman (hip) and Taurean Prince (ankle). The Mavericks played without Dennis Smith Jr. (wrist) and Dirk Nowitzki (left ankle), but did get Maxi Kleber back from a left great toe sprain.
Atlanta continues its three-game road trip on Friday with a game at Boston. Dallas plays at Phoenix on Thursday for the second half of a back-to-back. — Reuters

Malaysia, Vietnam make a go at Suzuki Cup title

THE final of the 2018 AFF Suzuki Cup gets to be decided this weekend as Malaysia and Vietnam make one last go at the title when they collide in the second leg of the titular in Hanoi.
With the first leg in Kuala Lumpur on Tuesday ending in a 2-2 draw, the two teams now scramble to get the job some in the second leg on Saturday to be crowned this year’s champion of the biennial regional tournament.
Vietnam started strong in the first leg, going up, 2-0, early in the opening half with goals from Nguyen Huy Hung (22’) and Pham Duc Huy (25’).
But the host side would regroup, narrowing its deficit, 2-1, in the 36th minute with a breakthrough goal from Sharul Saad.
Malaysia then levelled the count in the second half as Safawi Rasid found the bottom of the net in the 60th minute.
The two teams tried to fashion out the go-ahead goal but none would come as full time sounded, leaving them to settle for the draw.
The outcome left the title to be decided in the second leg, where Malaysia needs to make up for the two goals they conceded at home.
Despite that, the Malaysians said they are not giving up and vowed to give their all when they return to play at the My Dinh National Stadium in Vietnam.
“We know it won’t be easy to win in Vietnam but I’m sure all my teammates will remain focused and make sure that we’re physically and mentally right to go,” Safawi was quoted as saying by the Suzuki Cup Website.
For Vietnam, which eliminated the Philippines in the semifinals, 4-2, on aggregate, it said it would work hard to finish the job at home.
“Having those two goals and the draw is an advantage, I agree, but not such a big one and we still need to make sure that we don’t concede any goals in the next match in Hanoi,” defender Tran Dinh Trong was quoted as saying.
“We’ve played together for a long, long time. We did our best in this match and also considered the result but we’re not worried too about the draw — the result is not a problem for us and we’re looking forward to the second leg,” he added. — Michael Angelo S. Murillo

MPBL: Caloocan Supremos, Bulacan Kuyas outplay rivals

CALOOCAN and Bulacan relied on their awesome twosome to turn back their respective rivals in the MPBL Datu Cup on Wednesday night at the Caloocan Sports Complex.
The Caloocan Supremos counted on the dynamic duo of Paul Sanga and Amond Vosotros to whip the Pampanga Lanterns-ADG Construction, 78-62, and keep their hopes alive for a playoff berth in the fastest growing regional amateur basketball league put up by Senator Manny Pacquiao with PBA legend Kenneth Duremdes serving as commissioner.
Sanga, a former player of Kia in the PBA, knocked in six triples on his way to finishing with 22 points.
The Supremos, backed by Longrich, was paced by Vosotros, who came away with 23 points on top of dishing out eight assists and pulling down seven boards in an all-around effort that led to his team’s fifth win in 17 games.
They have snapped their four-game losing skid.
Caloocan, however, has a lot of catching up to do as it remained at 12th spot of the tough northern division.
Earlier, Bulacan blasted Pampanga, 87-70, as the Kuyas banked on their own 1-2 punch in James Martinez and the rejuvenated Ogie Menor.
Martinez, who had a brief stint playing for the Powerade Tigers in the PBA, tallied 15 points.
The biggest revelation, however, was Menor, plucked out of retirement coming from the United States, who played his best game of the season. He ended up with 13 markers and provided the intangibles for the Kuyas, who notched their 11th win in 17 games to stay at fifth spot in the northern division.
Head coach Britt Reroma believes Menor is just starting to pick up his game.
“I think we’ll see more of better games from him. He’s still not in tip-top condition, but he’ll be an asset to this team,” added Reroma. — Rey Joble

Hero-ball

Kyrie Irving surveyed the situation close to the centercourt logo of the Capital One Arena. With 22 ticks left in a tied game, the ball was in his hands anew. All and sundry, including the 20,409 fans on the edge of seats, figured they knew what he would do: milk the clock a bit more to add to the eight seconds already spent on the Celtics’ potentially final possession and then make a play. The formation indicated a drive, with three on the strong side and another in the corner. And, as for most of the contest, John Wall was on his case, but sagging just below the three-point line to best cover for the likely run to the basket.
Needless to say, Irving knew what to do. Seeing the space Wall gave him, he made a move with 20 seconds left, taking a small step forward, and then another — but not to sprint to the basket. Instead, he launched a three from deep. He went for the element of surprise, and he got it, even from his teammates. One other thing he got: an uncontested attempt. To be sure, he was so far from the arc when he took the shot that it carried a higher degree of difficulty. Then again, he was in rhythm, and, more importantly, the same ice water running in his veins that enabled him to score the Celtics’ last seven points gave him all the confidence he needed to decide the outcome either way.
In retrospect, it was, perhaps, only fitting for Irving’s derring-do to be rewarded, and with Wall, who likewise starred for the Wizards, in front of him. After all, the Celtics should have won in regulation had they not suffered from a lapse in coverage late and allowed Bradley Beal to rebound a missed free throw and lay the ball in to force the extra period. Moreover, he saw his hero-ball predilections being rewarded with the contest on the line. His immediate past trey near the corner was more hotly contested.
Interestingly, the tiff didn’t look like it would go down the wire, what with the Celtics missing three key players. As things turned out, the handicap was just what the inconsistent Wizards needed to stay close. Parenthetically, their battles last season were likewise of the see-saw variety; two also required more minutes in order to be resolved. Moving forward, though, it’s clear that the green and white are better positioned to compete than the red and blue. And longtime habitues of the pro scene won’t be wrong to argue that it’s because the former can lean on Irving and the latter can’t.
 
Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994.

Gov’t wants more laws repealed for business

By Victor V. Saulon
Sub-Editor
THE TRADE DEPARTMENT as well as other state agencies and offices have identified a host of laws either for repeal or amendment in their bid to further ease the burden on small businesses and to improve public services.
“The laws recommended for repeal today will be submitted to the Presidential Legislative Liaison Office, the main bridge of the Executive branch to the legislature,” Rowel S. Barba, undersecretary at the Department of Trade and Industry (DTI), said in an interview on Wednesday, explaining that “[t]he laws are no longer relevant today…”
The recommendation was made during the 4th Repeal Day, an exercise aimed at streamlining the business process, held at the Philippine International Convention Center in Pasay City.
“I think from day one, it’s now about 5,000,” Mr. Barba said, when asked for the total number of department orders and circulars that had been repealed.
“The Repeal Day today is the first time that we were able to recommend the repeal of laws.”
The laws recommended for repeal include Republic Act No. 7394 or The Consumer Act of the Philippines, as identified by the Food and Drug Administration which wants to overhaul and update definitions and product jurisdictions of state offices.
From the Department of Trade and Industry, the outdated laws are:

• RA 3952 or the Bulk Sales Law, which has been made obsolete by technological developments;

• Commerce Administrative Order No. 3 Series of 1993 or the Rules and Regulations Governing the Licensing and Bonding of Stock or Bond, Merchandise, Money or Exchange Ship and Real Estate Brokers, which has been made obsolete as well by technological developments;

• RA 247 or the Bonded Warehouse Act, which has been made obsolete by government measures to ensure food sufficiency and stable prices;

• Commonwealth Act 138 or an Act to Give Native Products and Domestic Entities the Preference in the Purchase of Articles for the Government; and

• The Professional Regulation Commission (PRC) recommended the repeal of Executive Order 565 and 565-A to allow the agency to elevate policy directions directly to Malacañang without having to get prior endorsement from the Department of Labor and Employment.

Other offices like the Department of Health (DoH), Department of Justice, Department of Foreign Affairs (DFA), Department of Public Works and Highways (DPWH), DTI, as well as the National Economic and Development Authority (NEDA) have identified 25 other laws that they recommended for amendment.
The DFA recommended amendment of the Philippine Foreign Service Act of 1991 and of the Philippine Passport Act of 1996 to better serve the public.
One of the laws recommended by NEDA for amendment is the Build-Operate-Transfer Law to streamline and consolidate all other legal issuances related to public-private partnerships.
The DPWH wants an amendment to RA 10752, An Act Facilitating the Acquisition of Right-of-Way Site or Location for National Government Infrastructure Projects, in order to better enable implementing agencies to entice property owners to opt for negotiated sale.
The Social Security System (SSS) recommended the amendment of RA 1161, An Act Further Strengthening the SSS, to update the agency’s investment capabilities. The SSS also proposed an unemployment or involuntary separation benefit for workers and their beneficiaries.
The DoH sought amendment of RA 4226, or the Hospital Licensure Law that was enacted in 1965, to cover new types of health facilities that need to be regulated.
The PRC recommended the amendment of the Philippine Nursing Act of 2002 in order to make it easier for review centers to operate.
The Quezon City government is seeking the amendment of Presidential Decree 856, or the Code on Sanitation in the Philippines, to provide a 365-day effectivity of sanitary permits. It also wants to scrap building fire inspection fees since this service is the responsibility of the Bureau of Fire Protection.
Sought for comment, Camiguin Rep. Xavier Jesus D. Romualdo, vice-chairman of the House of Representatives Trade and Industry committee, said the DTI and the Anti-Red Tape Authority (ARTA) that was formed by RA 11032 — or the Ease of Doing Business and Efficient Government Service Delivery Act of 2018 — should submit the list and brief the panel “so we can consider their recommendations and take appropriate action.”
Sought for comment, Guillermo M. Luz, who was private sector co-chairman of the now dissolved National Competitiveness Council, said: “Over time as the country eliminates and repeals all the outdated laws, all the irrelevant laws, we simplify the way things are done with government transactions, we simplify a lot of rules, regulations hopefully all the way to the local government level.”
“And when we have that, we will improve on the Ease of Doing Business [ranking] over time.”
Mr. Luz, associate director at Ayala Corp., led the first three Repeal Days.
During the event, the DTI and ARTA also launched the Project Repeal Guidebook as well as the Web portal Philippine Business Regulations Information System that serves as a database of all government-issued rules and regulations.
“One of the biggest problems faced by entrepreneurs is that you don’t even know the regulations you need to comply with. And the agencies only know their own regulations. They don’t know the regulations of each other,” said Roberto Martin Nolan Galang, World Bank senior private sector specialist for microeconomics, trade and investment.
“This one puts it all in one portal, so you can cross-reference regulations: you can now know that you have to go to one and then the other to complete [transactions]. And… it also showcases how many regulations there are.”

Inflation mars ADB’s economic picture of PHL

By Elijah Joseph C. Tubayan
Reporter
THE ASIAN Development Bank (ADB) has retained economic growth estimates for the Philippines that made the country one of Asia’s best performers, but at the same time upped its projected inflation rate this year to one of the region’s fastest.
In the Asian Development Outlook Supplement which ADB released on Wednesday, the regional lender kept its 2018 and 2019 Philippine gross domestic product (GDP) growth forecasts at 6.4% and 6.7%, respectively, from its September report.
“GDP growth is seen accelerating through 2019, supported by robust public and private investment. Growth forecasts are maintained at 6.4% for 2018 and 6.7% for 2019,” ADB said.
If realized, the Philippines’ 2018 growth would be slower than the actual 6.7% recorded in 2017, while 2019’s pace would match that of last year.
The nine months to September saw GDP growth average 6.3%, which the ADB said “remained strong” even as it was slower than the 6.8% clocked in the same period last year.
“Investment was the biggest contributor to growth, followed by household consumption. Investment growth accelerated to 16.7% in the first three quarters from 9.8%. Public and private construction growth quickened, as did investment in durable equipment. Growth in government spending also picked up on higher social service expenditure and on salary hikes for government workers,” the development bank said.
“Drag on GDP growth from net exports deepened, however, as strong domestic demand fueled a surge in imports, especially of capital goods, and as a weaker external environment slowed export growth.”
ADB’s forecasts compare with the World Bank and International Monetary Fund’s 6.5% and 6.7% for 2018 and 2019, respectively, and the 6.7% estimate of the Organization for Economic Cooperation and Development for both years.
ADB’s economic growth prospects for the Philippines are higher than the Southeast Asia average estimates of 5.1% for 2018 and 2019, as well as the six percent and 5.8% in 2018 and 2019, respectively, of “developing Asia”, consisting of 45 of the regional lender’s 67 members.
The Philippines will be the third-fastest this year after Vietnam (6.9%) and China (6.6%), and will be the second-best in 2019, again after Vietnam (6.8%) and ahead of China (6.3%).
ADB stated that infrastructure spending was also strong in Brunei, Indonesia, and Thailand, but noted that Malaysia saw a decline.
INFLATION RISK
At the same time, ADB increased the Philippines’ inflation projection this year to 5.3% — matching the forecast of the Bangko Sentral ng Pilipinas — from five percent initially, and retained the four percent outlook for 2019.
“… the Philippines saw inflation moderate to 6.0% in November from a high of 6.7% in October, for an average of 5.2% in the first 11 months, well up from 2.9% a year earlier. Food prices rose significantly owing to weak agricultural output, and high global oil prices early in the year and new excise taxes contributed to inflation,” ADB said.
“While inflation is expected to ease, the full-year average is still likely to exceed the projection in the Update. The inflation forecast for 2018 is therefore revised up from 5.0% to 5.3%,” it explained.
“The recent buildup in inflationary pressure should moderate next year, with inflation still projected at 4.0%, as in the Update,” it noted, adding: “Tight monetary policy will kick in following a cumulative rate hike of 175 basis points implemented from May to November 2018.”
The ADB cited that: “Oil prices continue to drop as supply outpaces expectations, which reduces pressure on external balances in the region, particularly in India and the Philippines.”
Its inflation forecast for the Philippines is above Southeast Asia’s forecast average of 2.7% in 2018 and 2.8% in 2019, and on the list except for Kazakhstan, whose overall price increases will clock in at 6.3% this year and 6.5% in 2019.
Inflation rate outlook of select Asian economies

Inflation rate outlook of select Asian economies

THE ASIAN Development Bank (ADB) has retained economic growth estimates for the Philippines that made the country one of Asia’s best performers, but at the same time upped its projected inflation rate this year to one of the region’s fastest. Read the full story.
Inflation rate outlook of select Asian economies

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