Home Blog Page 1178

The real existential crisis

PHILIPPINE STAR/WALTER BOLLOZOS

In November 2024, we cited in our column Francis Fukuyama’s enduring insight: democracy doesn’t often fall with a dramatic crash, but erodes slowly through complacency, compromised institutions, and the quiet retreat of accountability.

That erosion of checks, of balances, and of public faith is no longer theoretical. In the Philippines today, it is playing out on two critical fronts. The first is domestic: a subtle normalization of impunity in governance, where accountability faces a bloating of obstacles. The second is external: the enduring challenge of defending our sovereignty against persistent incursions in the West Philippine Sea.

These twin crises, the enemy within and the enemy without, reflect a deeper struggle over justice, institutional integrity, and national dignity.

Few issues in recent memory have tested the architecture of public accountability more visibly than the impeachment of Vice-President Sara Duterte. The move by the House of Representatives to adopt and transmit six articles of impeachment was both extraordinary and historic. With a resounding majority, including votes from the Vice-President’s own political base in Mindanao, the lower chamber appeared to assert a clear principle: that no official, no matter how powerful, should be beyond scrutiny.

The allegations were serious: alleged misuse of confidential funds, unexplained wealth, bribery, even incitement to sedition. And yet, they remained allegations, charges that demanded fair, impartial, and expeditious adjudication.

But the Senate, constitutionally mandated to act “forthwith” on impeachment, stalled. Deliberations dragged. Timetables shifted. Political signals grew mixed. Eventually, the issue reached the Supreme Court, which declared the impeachment complaint unconstitutional, citing the “one-year bar rule” — a legal provision meant to prevent successive, potentially harassing impeachment attempts within a single year.

The July 25 ruling clarified that the complaint, as the fourth filed within a year, was inconsistent with the Constitution, and the Senate could not acquire jurisdiction over it. The Court was careful to note that it was not ruling on the merits of the allegations themselves, but only on the procedural validity of the complaint.

As a quick response the other day, Aug. 6, the Senate agreed to archive the impeachment articles. This decision is not dismissal, and therefore the Supreme Court could still act on several pending motions for reconsideration including those filed by the House of Representatives, 1Sambayan, Tindig Pilipinas, and TAMA NA. Some viewed this as a prudent step in deference to judicial authority. Others lamented it as a lost opportunity for the Senate to uphold its constitutional duty and allow the impeachment trial to unfold, transparently and fairly, in public view.

What cannot be denied is that the process ended not with resolution, but with retreat.

To be sure, due process must be respected. Vice-President Duterte has denied wrongdoing and, like all citizens, deserves the presumption of innocence. The Supreme Court’s role in safeguarding the Constitution must likewise be acknowledged. But it is equally important to reflect on what this episode reveals about the state of our institutions.

When the mechanisms of accountability are disrupted, whether by political inertia or procedural technicalities, the perception of impunity grows. And that perception, if left unchecked, becomes corrosive. Our people begin to believe that power shields, rather than obligates. That institutions protect the powerful more than they serve the public.

Such erosion is not always visible. But it is deeply felt.

Recent surveys confirm what we already sensed: 88% of Filipinos expect accountability from public officials. An overwhelming majority believe our leaders must focus on effective governance. These are not partisan demands. They are fundamental expectations in any functioning democracy.

When those expectations are unmet, democracy doesn’t explode. It quietly implodes.

No doubt, impeachment is not vengeance. It is a constitutional mechanism designed to protect the Republic. Archiving it without a trial, however legally sound the reasoning, risks sending the wrong signal: that public trust can be broken without consequence.

While institutional questions play out at home, a far more visible and alarming struggle continues to unfold beyond, and, yes, even within, our shores.

Nine years ago, in 2016, the Philippines won a decisive arbitral ruling at The Hague. That judgment invalidated China’s sweeping claims in the South China Sea including large swathes of our own exclusive economic zone (EEZ). The ruling was clear: under international law, there is no legal basis for China’s “nine-dash line.”

And yet, the harassment continues.

As we recently wrote for GlobalSource Partners, China’s Coast Guard ships regularly shadow, block, and even ram Philippine vessels. Our supply missions to the BRP Sierra Madre in Ayungin Shoal are intercepted or delayed. Filipino fishermen are driven away from traditional fishing grounds, their livelihoods jeopardized in waters the world rightly recognize as ours.

This brings us to a compelling new documentary, Food Delivery, which we watched at Rockwell on Aug. 1. It captures the everyday courage and humiliation of this struggle. It documents the Philippine military’s effort to deliver basic supplies — food and water — to soldiers stationed at Ayungin Shoal and to Filipino fishermen near Scarborough. These are not combat operations. These are acts of sustenance and sovereignty.

The footage is harrowing. We see unarmed boats pursued by far larger Chinese vessels. We hear stories of water cannons, starvation rations, and days spent evading Chinese blockades.

The film offers no overt argument. But it forces the viewer to ask: How can a sovereign nation, with a favorable international ruling, be prevented from feeding its own soldiers in its own maritime zone?

The answer, of course, is geopolitical reality. China’s rejection of the ruling has never wavered. Its strategy is to establish control not through legal victory, but through persistent physical presence. That presence in the form of flotillas, reclamation, and militarization seeks to normalize occupation by exhausting Filipino resistance.

In his time, British-American journalist Felix Greene (The Enemy, 1971) warned of the dangers of “satellization” when powerful nations extend influence not through war, but through economic and political encirclement. In today’s context, it is not the United States but China whose actions mirror that cautionary tale.

The deeper crisis is not just the violation of our waters, but the normalization of such violation.

We proudly mark Independence Day with grand speeches. We cite the 2016 arbitral victory in diplomatic forums. Yet on the sea itself, our sovereignty is tested daily not by declarations, but by confrontations.

The parallels between the institutional and the geopolitical crises are hard to miss.

In both the archiving of the impeachment case and the slow erosion of maritime control, we see a tendency to defer, to delay action, and to prioritize caution over courage. In both, we, Filipinos bear the cost: the public servant denied due resolution, the soldier left with dwindling rations, the fisherman returning with empty nets.

These are not just policy failures. They are moral tests.

When we treat accountability as optional, we erode the rule of law. When we accept foreign intimidation as inevitable, we diminish national dignity. In the process, we reduce what it means to be a democratic republic.

And the consequences are not abstract, they are real. A weakened rule of law affects investor confidence, dampens innovation and productivity, and undermines economic growth. Our failure to stand firm in defending our seas affects not only our security, but also our food security and our regional credibility. The compulsion is to protect, and not to gamble, the future of our next generation.

The President now faces a delicate balancing act: upholding our sovereign rights against Chinese encroachment while managing relationships with strategic allies. His principled stance in the West Philippine Sea deserves support, especially as it asserts our rights without needlessly provoking conflict. But that stance must be matched by consistency in rhetoric, in diplomacy, and in material support for our frontliners.

Democracy, like sovereignty, requires active defense. Both need institutions that do not waver when tested. They need citizens who remain engaged, and leaders who prioritize the Republic above themselves and their political commitments.

Ultimately, the question is not whether we support or oppose a particular leader. It is whether we still believe that law binds power. That the sea is not just water, but patrimony. That justice is not just a slogan, but a duty.

Our Republic is still struggling. But our struggles are no excuse for weakness. Struggles should toughen us up, and not enfeeble us. We need to strengthen our institutions so that when crises come, they do not collapse under the weight of convenience or coercion.

The impeachment case may be archived, but the question of accountability remains. The sea may be patrolled by foreign ships, but the duty to defend it continues.

As citizens, we say no to cynicism. We demand justice, we insist on sovereignty, and we remind our leaders that the strength of a nation is measured not by force, but by the resolve to do what is right even when it is difficult and a lonely cause.

Because when we stop fighting for accountability and sovereignty, we stop being a nation.

And that is the real existential crisis we must confront.

 

Diwa C. Guinigundo is the former deputy governor for the Monetary and Economics Sector, the Bangko Sentral ng Pilipinas (BSP). He served the BSP for 41 years. In 2001-2003, he was alternate executive director at the International Monetary Fund in Washington, DC. He is the senior pastor of the Fullness of Christ International Ministries in Mandaluyong.

Peso rebounds to P56 level on Fed easing bets, PHL GDP data

BW FILE PHOTO

THE PESO jumped back to the P56 level on Thursday as the dollar was broadly weaker on bets of monetary easing by the US Federal Reserve and as Philippine gross domestic product (GDP) growth picked up in the second quarter.

The local unit closed at P56.97 versus the dollar, appreciating by 50.5 centavos from its P57.475 finish on Wednesday, Bankers Association of the Philippines data showed.

This was its best finish in two weeks or since its P56.65 close on July 24.

The peso opened Thursday’s session stronger at P57.33 against the dollar. Its worst showing was at just P57.35, while its intraday best was at P56.97 against the greenback.

Dollars exchanged rose to $2.71 billion on Thursday from $2.49 billion on Friday.

The dollar was generally weaker on Thursday amid heightened expectations of Fed rate cuts, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“The dollar-peso closed lower… on still dovish Fed bets and stronger-than-expected local GDP,” a trader said in a phone interview.

The US dollar remained lower against major peers on Thursday, with expectations of easier policy from the Federal Reserve stoked both by some disappointing macroeconomic indicators – not least Friday’s payrolls report — and US President Donald J. Trump’s move to install new picks on the Fed board that are likely to share his dovish views on monetary policy, Reuters reported.

Focus is centering on Mr. Trump’s nomination to fill a coming vacancy on the Fed’s Board of Governors and candidates for the next chair of the central bank, with current Chair Jerome H. Powell’s tenure due to end in May.

The dollar index, which gauges the currency against the euro, sterling and four other counterparts, eased 0.2% to 98.031, extending a 0.6% drop from Wednesday.

Meanwhile, the Philippine economic grew by an annual 5.5% in the April-to-June period, slightly faster than the 5.4% growth in the previous quarter. However, this was slower than the 6.5% expansion in the same quarter last year.

This matched the 5.5% median forecast in a BusinessWorld poll of 17 economists and the lower end of the government’s 5.5%-6.5% growth target for this year.

For the first half, GDP growth averaged 5.4%, slightly below the government’s goal.

For Friday, the trader sees the peso moving between P56.80 and P57.20 per dollar, while Mr. Ricafort expects it to range from P56.85 to P57.15. — Aaron Michael C. Sy with Reuters

Groundbreaking Latin jazz pianist-composer Eddie Palmieri, 88

The photo of Eddie Palmieri used in the announcement of his death on his Facebook page. — FACEBOOK.COM/EDDIEPALMIERI

EDDIE PALMIERI, a Grammy-celebrated pianist, composer and bandleader widely recognized as a leading figure in the Latin jazz and salsa music scene, died on Wednesday at his home in New Jersey, according to his Facebook page. He was 88.

No cause of death was given.

Born in the Spanish Harlem section of Upper Manhattan to Puerto Rican parents, Mr. Palmieri began studying piano as a youngster and made his musical debut performing at Carnegie Hall at age 11.

Two years later, he grew fascinated with percussion and joined his uncle’s Latin jazz orchestra on timbales at age 13, but soon switched again to piano and never looked back, according to a biography posted on AllMusic.com.

Still, his early infatuation with percussion went on to inform his dazzling, thunderous piano style, and compositions that transcended the boundaries of Afro-Caribbean music, jazz, funk and soul.

As described by AllMusic, his technique as a pianist incorporated bits and pieces from contemporaries ranging from McCoy Tyner to Herbie Hancock and recycled them through a dynamic, Latin groove.

“His approach can be compared to Thelonious Monk’s for its unorthodox patterns, odd rhythms, sometimes disjointed phrases and percussive effects played in a manner that is always successfully resolved,” AllMusic wrote.

In 1961, Mr. Palmieri founded the ensemble La Perfecta, redefining salsa by introducing trombones in place of trumpets for a deeper, heavier brass sound that became his signature. The band’s self-titled debut album is universally regarded as a Latin music classic.

His 1965 album Azucar Pa’ Ti (Sugar for You) became a dance-floor favorite and Mr. Palmieri’s most successful release. It was added to the US National Recording Registry by the Library of Congress in recognition of its cultural significance.

Mr. Palmieri’s 1971 album Harlem River Drive, also the name of his second band, showcased a genre-crossing, politically charged collection of songs blending Latin jazz, funk, and soul that is still considered a hallmark of musical activism.

That same year, he also recorded the album Vámonos Pa’l Monte (Let’s Go to the Mountain), featuring his older brother, Charlie Palmieri, playing organ. His elder sibling, known as the “Giant of the Keyboards,” died in 1988.

Other groundbreaking releases from among a body of work spanning seven decades include the albums Justicia Sun of Latin Music (1974) and The Truth: La Verdad (1987).

Mr. Palmieri is the recipient of 10 Grammy Awards, the National Endowment of the Arts’ Jazz Master Award and a lifetime achievement award from the Latin Academy of Recording Arts and Sciences, among other accolades. — Reuters

Filinvest Land Q2 income falls 9.9% on softer property sales

FILINVEST.COM

GOTIANUN-LED property developer Filinvest Land, Inc. (FLI) saw a 9.9% drop in attributable net income for the second quarter (Q2) to P909.29 million from P1.01 billion a year earlier due to lower real estate sales.

April-to-June consolidated revenue improved by 1.4% to P6.17 billion from P6.09 billion a year ago, FLI said in a regulatory filing.

Real estate sales declined by 5% to P3.78 billion, while rental services rose by 6.6% to P2.04 billion from P1.91 billion.

For the first half, FLI said its attributable net income declined by 3.7% to P1.81 billion from P1.88 billion a year earlier as total costs and expenses increased by 9% to P9.72 billion.

Consolidated revenue rose by 6% to P12.21 billion.

Real estate sales grew by 1.3% to P7.5 billion on steady collections, ongoing project completions, and contributions from industrial lot sales.

In its residential business, FLI said the middle-income segment contributed 70% of total residential revenues in the first half.

Earnings before interest, taxes, depreciation, and amortization (EBITDA) grew by 2% to P2.7 billion.

Leasing revenue rose by 12% to P4.1 billion on steady demand across the company’s office and retail portfolios.

Office rental revenue climbed by 8% to P2.48 billion, led by new tenant sign-ups and an 11% increase in occupied gross leasable area (GLA), bringing total occupied space to 398,000 square meters (sq.m.).

Retail leasing revenue rose by 11% to P1.32 billion due to stronger performance of assets such as Festival Mall, Il Corso in Cebu, Main Square in Bacoor, Fora Mall in Tagaytay, and Filinvest Malls Dumaguete.

In the second quarter, FLI said over 8,000 sq.m. of tenant GLA began operations, while over 10,000 sq.m. were signed for new leases.

The total operational GLA of the company’s retail portfolio stood at 257,170 sq.m.

FLI said its industrial business contributed P153 million in revenue for the first half, of which P133 million came from the sale of an industrial lot, while P20 million came from recurring rental income.

All nine ready-built factories in the Filinvest Innovation Parks in Calamba and New Clark City are now fully leased, with a total GLA of 21,956 sq.m.

“Our focused efforts on targeted rent strategies and tighter cost controls have proven effective in boosting both occupancy and EBITDA, supporting the steady growth of our leasing business,” FLI President and Chief Executive Officer (CEO) Tristaneil D. Las Marias said.

“We are optimistic that the upcoming openings of Filinvest Malls in Cubao and in Mimosa Leisure Estate in Clark will further drive this momentum. At the same time, we continue to push our residential developments in Visayas, Mindanao, and non-NCR Luzon regions, where we are seeing sustained demand,” he added.

In a separate disclosure, FLI’s real estate investment trust Filinvest REIT Corp. (FILRT) said it posted an 8.3% increase in first-half net income to P651 million as revenue climbed by 13% to P1.57 billion due to improvements in operations and the addition of Festival Main Mall to its portfolio.

FLI previously transferred the ownership of the main mall building of Festival Mall in Alabang to FILRT. The mall began contributing to FILRT’s revenue stream on May 29.

With the additional asset, FILRT’s portfolio size increased by 37% in terms of GLA to 452,310 sq.m.

“We are pleased to have infused a value-adding asset to our portfolio through Festival Main Mall,” FILRT President and CEO Maricel Brion-Lirio said.

“Having this momentum, we look forward to adding more assets and diversifying our tenant base to further the growth of the company,” she added.

On Thursday, FLI shares were unchanged at 82 centavos apiece, while FILRT stocks dropped by 0.29% or one centavo to P3.48 per share. — Revin Mikhael D. Ochave

The lack of choice: Agency, affordability, and pressures of starting a family

A YOUNG COUPLE cradle their baby outside their aunt’s bamboo hut in Catanduanes. — © UNFPA PHILIPPINES/ARJANMAR REBETA

By Jose Roi Avena

FILIPINO YOUTH often hear the familiar questions, “kailan ka mag-aasawa” or “kailan ka magkaka-anak?” (“When are you going to get married?” or “when are you going to have kids?”). Rarely do we ask the more important ones: Do you have a real choice? Are you ready — emotionally, financially, and with the support you need?

Every August, we observe Family Planning Month in the Philippines and in light of the changing demographics and growing economic pressures, it’s more important than ever to reframe the conversation. Placing the focus on the right to choose freely and confidently if, when, and how to build a family.

For too long, the conversation on family planning in the Philippines has been focused on numbers: on whether our fertility rate is too low or too high. But the real issue goes beyond statistics. The United Nations Population Fund (UNFPA), the United Nations Sexual and Reproductive Health Agency’s State of World Population 2025 (SWOP) report tells us the true challenge is reproductive agency. Simply put, we need to make sure that everyone has the right and ability to decide freely about their own family life without pressure and, more importantly, without barriers. Think of a young Filipino couple, perhaps like Maria and Jose. They might dream of a big family, just one child, or maybe they prefer to have no children at all. Their choice is deeply personal and valid. What truly matters is that they have the freedom and support to make that decision that their dreams for their family can become a reality.

THE FAMILY PICTURE: A SNAPSHOT OF WHERE WE ARE
Family planning, at its core, is about empowering individuals to achieve their desired family size. This includes crucial access to modern family planning methods vital for preventing unintended pregnancies and planning the timing and spacing of children.  Beyond this, it’s also about the support, information, and resources people need to realize their reproductive aspirations. Whether that means preventing a pregnancy now, or having the resources and environment to welcome children when they are ready, your family picture is for you to create.

In many ways, the Responsible Parenthood and Reproductive Health (RPRH) Law (RA 10354) has already taken this into consideration. It explicitly states that the State recognizes and guarantees “universal access to medically safe, non-abortifacient, effective, legal, affordable, and quality reproductive healthcare services, methods, devices, and supplies.” Furthermore, it mandates that “each family shall have the right to determine its ideal family size” and that the State shall equip parents with the necessary information on all aspects of family life, including reproductive health and responsible parenthood, to aid in this decision.

The question is: how many Filipinos have achieved their desired family size?

Analyzing the microdata from the 2022 National Demographic and Health Survey (NDHS), we learned that nearly 70% of Filipino women aged 40 and above had a family size that didn’t match what they ideally wanted, with 38.1% reporting fewer children than ideal and 30.2% reporting more than ideal. This gap between dreams and reality is at the heart of the “real fertility crisis.”

WHY OUR DESIRED FAMILIES REMAIN OUT OF REACH
What is stopping young Filipinos from starting the families they dream of? UNFPA’s report highlights clear barriers, many of which hit close to home, reflecting persistent systemic challenges.

The biggest hurdle is often economic insecurity. The SWOP report found that a staggering 39% of people globally cited financial limits as a reason for not having their desired number of children.

Beyond direct financial constraints, job insecurity and housing problems continue to be major challenges.

For many young Filipinos, this means struggling to find stable, good-paying jobs while coping with the rising costs of basic needs such as housing, transportation, and food.

Social factors also play a big part, particularly the unequal sharing of unpaid care work. Women often spend three to 10 times more hours on household chores and caring for family members than men. This imbalance limits women’s opportunities and directly affects their choices about having children. When couples share these responsibilities more fairly, they feel more supported and confident in building the families they desire.

A FOCUS ON CHOICE AND HOPE
This Family Planning Month, it’s time to shift our focus from numbers to people. The real fertility crisis isn’t about how many Filipinos there are, but whether every Filipino has the freedom and support to create the family they desire, on their own terms.

To make this a reality, we must collectively commit to action. And that means fully supporting the implementation of the RPRH Law and ensuring adequate budgets are allocated and spent to reach every Filipino.

Real progress means fostering more equitable social structures and shared responsibilities within families. We have to confront and actively challenge outdated and unequal gender norms that put the burden mostly on women.

Ultimately, we need to provide comprehensive support to young couples and families by directly addressing the economic and social barriers that stand in the way of their reproductive choices and aspirations. This includes investing in job creation, affordable housing, and accessible childcare, foundations that allow families to grow with stability and dignity.

By investing in comprehensive health services, promoting economic fairness, upholding human rights, and fully implementing the RPRH Law, we can build a world where young people are not held back by barriers beyond their control. A future where Maria and Jose, and all young Filipinos, can start a family if they choose to, not because they are pressured to, and not because they are denied the chance. This is how we build a more equal, sustainable, and hopeful future for everyone.

 

Jose Roi Avena is the assistant representative and officer-in-charge of the United Nations Population Fund in the Philippines.

Taxing long-term savings: a misstep

The recently enacted Capital Markets Efficiency Promotion Act (CMEPA), hailed by some as a tax reform milestone, is turning out to be a misguided step when it comes to savings and investments. Its provision to remove the tax exemption on interest from long-term deposits and investments (those exceeding five years) now subjects these instruments to a 20% final withholding tax — a measure with far-reaching negative consequences for the economy.

The Philippines already faces a structural weakness: a low savings rate of around 13-14% of gross domestic product (GDP), according to World Bank data, compared to Vietnam (27%) or Indonesia (32%). This savings deficiency limits the country’s capacity for domestic investments in infrastructure, industry, and innovation.

Without a robust domestic savings pool, the country remains dependent on foreign capital, overseas Filipino workers’ remittances, and short-term inflows — all vulnerable to global financial turbulence.

Dr. Cielo Magno, former Undersecretary of Finance, succinctly captured this in a recent forum: “We must increase domestic savings to fund our development ambitions. Taxing long-term savings is a disincentive when we should be building a culture of investment.”

Taxing long-term savings affects the middle class and ordinary Filipinos the most. Time deposits, government bonds, and other secure instruments have been the traditional vehicles for long-term wealth accumulation in the absence of accessible, well-regulated investment alternatives.

Financial literacy campaigns advocate “saving for the future,” yet government policy now sends the opposite signal: save less, spend more, or risk more in volatile markets. This is hardly conducive to building financial security, especially in a country where social protection and retirement systems remain inadequate.

CMEPA’s tax uniformity may sound appealing in technocratic terms, but it contradicts the country’s broader goals of deepening domestic capital markets, promoting financial inclusion, and reducing dependence on foreign funding.

Worse, it disincentivizes the very behavior needed to address these gaps. The Asian Development Bank (ADB) has consistently stressed that high savings rates fuel investment-led growth in East Asia — a path the Philippines risks veering away from.

The proponents of CMEPA in Congress and the Senate, with the Department of Finance (DoF) providing key support, presented an argument that focuses on tax neutrality and revenue needs. However, this lens misses the developmental context: growth cannot be built on fiscal efficiency alone — it needs a savings culture.

DoF officials have argued that the exemption only benefits the rich who have enough funds to stash away and not touch for at least five years. No less than the DoF Secretary has said in a public interview that the measure, especially the reduction on stock transaction tax, is to invite the public to invest in the stock market where there is opportunity for higher returns.

The reasoning is flawed. Many long-term time deposits now allow interest payouts quarterly or semi-annually. For the small folk and the retirees, this is living on interest, while preparing for the future. Wealthier individuals, meanwhile, can navigate into bonds, equities, real estate, or even offshore instruments to preserve their purchasing power. The ordinary people do not have the risk appetite for stocks in a volatile environment where information is not readily available to all. Those who lack access to financial literacy or higher-yield instruments end up putting their money in bank accounts that slowly erode its value.

This measure risks being remembered as a fiscally convenient but economically short-sighted policy.

This corner even believes the 20% tax on regular savings is too much of a burden for the ordinary folks. The average savings deposit rate in traditional banks — where most Filipinos still keep their money — is a mere 0.10% to 0.25% per annum. Imagine deducting 20% from this and nominal interest income is a pittance. Can the tax not be lowered? Even in digital banks that promise higher returns, typical rates of 4% to 6% are often capped at low balances, and the sustainability of these rates remains uncertain.

Now layer on inflation and the picture becomes even starker. For the few savers earning 4% interest from a digital bank, the after-tax return is 3.2%. Subtract inflation, and you get a real interest rate of -0.6%. In simpler terms: you are losing money in real value, even while saving.

In this context, discouraging long-term savings through taxes and low yields is not just bad economic policy — it’s self-sabotage. Thus, what should have been a neutral financial habit — saving — has become a regressive burden.

Instead of a flat 20% tax on all long-term savings, policymakers should:

1. Reintroduce tax exemptions for savings held over extended periods.

2. Offer tax-deferral mechanisms or lower rates for retirement-oriented products.

3. Provide tax credits or exemptions for investments channeled into infrastructure, micro, small, and medium enterprises, and green finance.

4. Introduce tiered tax rates that protect small savers — say, the first P10,000 in annual interest.

5. Encourage financial institutions to develop low-risk, inflation-beating products that are accessible to ordinary citizens.

The Philippines must not mortgage its long-term growth for short-term fiscal gain. It is time for Congress to reassess CMEPA’s unintended effects on savings. To quote former Bangko Sentral ng Pilipinas Governor Amando Tetangco, Jr., “Savings is not just personal prudence; it is national strength.”

Savings should not be punished. They should be protected, nurtured, and encouraged — because they are not just a personal virtue but a national necessity. When inflation, low yields, and taxes combine to make saving a losing proposition, the message to ordinary Filipinos is tragic: spend or speculate, but don’t save.

If the country is serious about development, savings should be nurtured — not taxed away.

The views expressed herein are the author’s own and do not necessarily reflect the opinion of his office as well as FINEX.

 

Benel Dela Paz Lagua was previously EVP and chief development officer at the Development Bank of the Philippines.  He is an active FINEX member and an advocate of risk-based lending for SMEs. Today, he is independent director in progressive banks and in some NGOs.

Pru Life UK launches endowment insurance plan

PRU LIFE Insurance Corp. of UK Philippines (Pru Life UK) has launched a 20-year endowment insurance plan.

PRUSteady Income is a life insurance plan that offers guaranteed protection and a steady income stream, it said in a statement on Thursday.

“At Pru Life UK, we are committed to understanding what matters most to our customers. We designed PRUSteady Income as a practical financial solution that empowers our customers to confidently pursue their priorities today and prepare for life’s milestones ahead,” Pru Life UK Chief Product Officer Garen U. Dee said.

Policyholders are guaranteed net annual cash payouts equal to 10% of the sum assured from the end of the 11th year until the 20th year of the policy. The full sum assured will be given as a maturity benefit once the 20-year term ends.

If the insured dies before the plan ends, beneficiaries will receive up to 200% of the sum assured as death benefit.

The policy also includes loanable cash values to help manage unexpected financial needs.

Pru Life UK said the product aims to help clients that want a balanced portfolio and those seeking to save for their future while being protected financially.

“Filipinos often put their families first and themselves second. With PRUSteady Income, we want to help them do both at the same time. It’s about giving people the confidence to care for their loved ones now, while also investing in the well-being of the person they’ve always aspired to be,” Ms. Dee said.

“Beyond the 20-year coverage period, the maturity benefit can add to the policy owner’s retirement savings, offering financial security at a time when economic uncertainties make long-term planning more essential than ever,” she said. “The reality is saving often takes a backseat to immediate responsibilities. This product provides financial protection with guaranteed payouts, while the maturity benefit serves as a financial cushion for pursuing long-overdue personal goals.”

Pru Life UK booked a premium income of P48.15 billion in 2024, data from the Insurance Commission showed. Its net income was at P3.72 billion last year. — AMCS

Philippines’ Quarterly Gross Domestic Product Performance

THE PHILIPPINE ECONOMY expanded at a slightly faster pace in the second quarter, driven by strong agriculture production and an uptick in consumption, the statistics agency said on Thursday. Read the full story.

Philippines’ Quarterly Gross Domestic Product Performance

US sanctions Mexican cartel figures, including popular rapper El Makabelico

MUSIC.AMAZON.COM

THE US Treasury Department on Wednesday announced sanctions on assets of four individuals whom it linked to Mexico-based Cartel del Noreste, including the popular hip-hop artist El Makabelico.

Treasury said the sanctions target three “high-ranking members” of Cartel del Noreste (Northeast Cartel), which splintered off from Los Zetas, as well as a “prominent associate” of the group, Ricardo Hernandez, a 34-year-old musician known as El Makabelico who has millions of followers on social media.

Treasury said El Makabelico’s concerts and events are used to launder money on behalf of the organization, “with 50% of his royalties from streaming platforms going directly to the group.”

A Spotify spokesperson said the company was reviewing the decision and would comply with its legal obligations. Apple and Alphabet-owned YouTube did not immediately respond to requests for comment.

DEL Records, which Hernandez lists as his label on social media, did not immediately respond to a request for comment.

Treasury identified the three other individuals as Abdon Rodriguez, Antonio Romero and Francisco Esqueda.

Washington said the sanctioned individuals have played a critical role in the cartel’s activities, including drug trafficking, extortion, and money laundering.

The Treasury said it had also sanctioned two “high-ranking members” of the cartel in May.

The cartel was among those that President Donald J. Trump’s administration in February designated as global terrorist organizations.

“The Treasury Department will continue to be relentless in its effort to put America First by targeting terrorist drug cartels. These cartels poison Americans with fentanyl and conduct human smuggling operations along our southwest border,” said US Treasury Secretary Scott Bessent.

The Cartel del Noreste is considered one of Mexico’s most violent drug trafficking organizations and wields significant influence along the US-Mexico border, particularly at Laredo, Texas, the Treasury said. — Reuters

Agila Subic eyes expansion as tenants scale up operations

PHILIPPINE STAR/RYAN BALDEMOR

SUBIC, ZAMBALES — Agila Subic, a Cerberus-run industrial facility in Subic, is open to expanding its site by up to 50 hectares to meet operational requirements of existing tenants, its top official said on Thursday.

The 310-hectare facility may add piers or develop land for tenant use, subject to approval from the Subic Bay Metropolitan Authority and depending on demand, Agila Subic General Manager Mark Glenn D. Milan said in an interview with BusinessWorld.

“It depends on the development of how we see the requirements of our current tenants, but we have additional space that we see could be used for additional facilities,” he said.

“That is part of our capacities on the site to optimize the use of the facility,” he added.

US investment firm Cerberus took control of the facility in 2022 and renamed it Agila Subic Facility after the collapse of Hanjin Heavy Industries and Construction-Philippines, Inc. in 2019.

South Korean shipbuilder HD Hyundai Heavy Industries, the Philippine Navy, global subsea cable firm SubCom, and logistics provider V2X currently lease portions of the Agila Subic Facility under agreements ranging from eight to 15 years, Mr. Milan said.

The three private companies share 220 hectares of the area, with the remaining 90 hectares being rented to the Philippine Navy, he added.

“They’re still in the aspect of settling in,” he said, adding that once the lessees are fully established, they’ll be in a better position to assess whether they need more space. “We need to be ready for that.”

Agila Subic expects its tenants to seek ways to enhance operations and maximize the use of leased land, he added. “They have to continually improve their capacities to increase the business opportunity for them to use the land.”

“When we lease out space, we don’t lease it like it’s just an office… With us, it’s the whole facility, tailored to the operational requirements of the company,” he said.

Mr. Milan said Agila Subic and its tenants have collectively invested around $1 billion to upgrade and modernize the shipyard.

“That covers everything already from the initial investment condition to the capital expenditures that it would like to have to support the improvements of the facilities, and then the continuing renovations and improvements that our tenants will need for them to operationalize the business,” he said. — Kenneth Christiane L. Basilio

UA&P unions file strike notice

UAP.ASIA

UNIONS at the University of Asia and the Pacific (UA&P) filed a notice of strike on Thursday with the Department of Labor and Employment (DoLE) following fourth months of collective bargaining.

“This decision comes after UA&P Management failed to provide the unions any non-negotiable concessions for mediation to continue,” the University of Asia and the Pacific Union of Faculty Members (UA&PUFM) and University of Asia and the Pacific Union of Allied Employees (UA&PUAE) said in a statement.

UA&P was contacted by e-mail for comment but had not replied at the deadline.

UA&PUFM President Ferdinand D. Delos Reyes said that collective bargaining began in May but the university had not addressed key points of negotiation like salaries and benefits.

“They were no longer giving in to our demands. So, basically, we said that there’s no point proceeding with CBA negotiations,” Mr. Delos Reyes said by telephone.

Mr. Delos Reyes said the deadlock centered on seven priority economic provisions and the suspension of a policy requiring faculty to work onsite for 5.5 days each week.

The unions said that the announcement of a full onsite work schedule added to the economic burden on employees.

He said university workers have been seeking upgrades to salary and a promotion system in line with industry standards.

“We’re also of course asking for improvements in terms of our fringe benefits. Part of what we’re proposing is an expansion of our HMO coverage to also include our dependents. We’re also asking for improvements in terms of our rice allowance,” Mr. Delos Reyes said.

According to the Labor Code, a strike arising from a collective bargaining deadlock may take place 30 days following the filing of notice and following a strike approved by an absolute majority of union members. The actual strike may occur seven days after notifying DoLE’s National Conciliation and Mediation Board.

“We had a bargaining deadlock around June. And then after that, just to exhaust all our remedies, we filed a petition for preventive mediation where we appeared before a DoLE mediator,” he added.

The unions said that they remain open to resuming talks once they receive a “genuine counteroffer” on their priority issues and the suspension of the University’s onsite work policy. — Adrian H. Halili

Sea turtles aren’t the only victims of plastic

STOCK PHOTO | Image from Freepik

By Lara Williams

STOCK PHOTO | Image from Freepik

HERE’S A FACT that might make you feel a little strange inside: You and I have plastic in our brains. Tiny particles of polymers are also hanging about in our livers, kidneys, heart, and bloodstream. If that doesn’t make your insides itch, consider that in just eight years, scientists have observed an increase in the amount of bodily plastic. A study published in Nature compared post-mortem organ samples from 2016 and 2024 autopsy specimens. The more recent cadavers had far higher concentrations in the liver and brain.

You might wonder if it matters if we are all steadily becoming part-plastic (even a newborn baby contains plastic these days). What harm could such tiny particles do? Akin to climate change’s image of a polar bear on a lone ice float, the poster children of the plastic crisis thus far have been marine creatures choking on straws and carrier bags. These images are emotive but have kept the issue at arm’s length — a problem for the deep sea. In reality, it’s so much worse than you thought.

The Lancet, a peer-reviewed medical journal, has laid out the problem definitively, calling plastics a “grave, growing and under-recognized danger” in a paper published this week launching a global monitoring system to track progress on mitigating the harms.

Plastics are certainly useful. Their development has supported advances in fields such as medicine, engineering, and electronics. They’ve allowed us to make sterile, single-use catheters and syringes, which reduce the risk of infection.  They’re lightweight, making cars and other vehicles more fuel efficient. And they make insulating and housing electronics safer. Because the costs to the environment and human health are externalized, the material is cheap — allowing us all to access the convenience of a takeaway coffee or affordable clothing.

But we’re making the problem so much worse with our addiction to these non-biodegradable polymers. Global annual plastic production has soared to 475 million metric tons in 2022 from just 2 million tons in 1950. Half of all the plastic ever made has been produced since 2010 and, without intervention, we’re likely to be making 1.2 billion tons of the stuff every year by 2060. Because plastics don’t break down — they simply fragment into smaller and smaller particles — that’s billions of tons we’ll be adding to our ecosystems, waters, and bodies.

There are many ways plastic is bad for us. More than 16,000 chemicals can be present in plastics such as flame retardants, per- and polyfluoroalkyl substances (PFAS) and phthalates. Health impacts from exposure to such chemicals are wide-ranging and occur at every age, from miscarriages and reduced birthweight to cardiovascular disease and cancer. What’s worse is that hazard data isn’t available publicly for more than two-thirds of known plastic chemicals, meaning we have no idea how they could be harming us.

As well as tainting us with chemicals, the tiny fragments of the polymers — micro- and nano-plastics — are accumulating in our bodies, bypassing our built-in protective mechanisms such as the blood-brain barrier and placenta. Research is in the early stages, but already links have been suggested between microplastics and lung disease, inflammatory bowel disease and strokes, among other conditions.

Then there are some near-bizarre unintended health consequences. Who would have guessed, for instance, that plastic waste would contribute to the increasing spread of vector-borne diseases such as dengue and Zika, by providing favorable environments for Aedes mosquitos to lay their eggs? Likewise, a study from the University of Exeter and Plymouth Marine Laboratory found numerous links between plastic and antimicrobial resistance. Spills of crude oil, the starting point for many types of plastic, have been found to help bacteria become resistant to antibiotics, a process augmented by the chemicals added to plastic, such as bisphenols and phthalates.

Knowing all of this, people are attempting to limit their plastic exposure. Actor Orlando Bloom even splashed out $13,000 on an experimental blood-cleansing treatment. But honestly, it’s futile.

This morning, I went for a run. Everything from my sports bra to my shoes was made of a mix of synthetic materials including polyester and nylon. Afterwards, I squeezed toothpaste from a polyethylene tube. I cycled to work, inhaling microplastics formed by tire wear and road erosion. I’ve not been nearly organized enough to meal prep, so I’ll pop out to buy lunch, which will likely involve some single-use plastic. Later, I might have a cup of tea, and the bag will have plastic in it. That’s likely a fraction of the plastic I’m exposed to on a daily basis. Some of these things are within my control, but living a truly plastic-free life in our modern world is impossible.

Nations are currently hashing out a global plastics treaty in Geneva, Switzerland, after failing to reach an agreement in Busan, South Korea, last year. It’s imperative that they leave with strong legally binding commitments to tackle the problem.

Sadly, we’re not starting from a promising place: In Busan, nations split into two coalitions — a high-ambition group which advocates for phasing out harmful plastics and chemicals, and a coalition of oil-producing countries such as Russia and Saudi Arabia who want the treaty to focus on waste management and recycling. Each side became so entrenched that delegates couldn’t even agree on voting rules.

A strong treaty should impose limits on plastic production, regulate the use of hazardous chemicals within plastic, phase out single-use products and commit to improving recycling and waste management. It should also recognize the multitude of adverse health impacts that the production, use and disposal of polymers are having on us.

After all, plastic pollution doesn’t just threaten sea turtles. It’s also a clear and present danger to human health.

BLOOMBERG OPINION

ADVERTISEMENT
ADVERTISEMENT