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Gov’t anticipates more affordable borrowings

The Quezon City Hall building is lit with the Philippine flag, May 28, 2024. — PHILIPPINE STAR/MIGUEL DE GUZMAN

By Luisa Maria Jacinta C. Jocson, Reporter

THE GOVERNMENT is anticipating much lower borrowing costs moving forward amid further rate cuts by the Bangko Sentral ng Pilipinas (BSP) and improved credit ratings.

“Our recent credit rating upgrade will help reduce our borrowing costs. The reduction of BSP rates will help increase economic growth and also reduce our domestic borrowing costs,” Finance Secretary Ralph G. Recto told BusinessWorld in a text message.

Earlier this month, Japan-based Rating and Investment Information, Inc. upgraded the Philippines’ investment grade rating to “A-.”

The country also currently holds a “A-” rating from the Japan Credit Rating Agency but has yet to secure an “A” rating from the “big three” credit raters.

Mr. Recto said that the government has no plans to increase or revise its borrowing program for now.

“We have a fiscal plan to follow. There are no plans to increase our borrowings,” he added.

The National Government’s (NG) borrowing program is set at P2.57 trillion this year, of which 75% will come from domestic sources. It borrows from external and local sources to fund a budget deficit capped at 5.6% of the gross domestic product.

The latest data from the Treasury showed that debt payments jumped by 41.29% to P1.28 trillion in the first half. The government has allocated P2.03 trillion in debt servicing for this year.

National Treasurer Sharon P. Almanza likewise said that the current borrowing plan has “taken into account” the central bank’s easing cycle.

The Monetary Board earlier this month delivered a 25-basis-point (bp) rate cut, bringing the benchmark rate to 6.25% from the over-17 year high of 6.5%.

The central bank could cut rates by another 25 bps in the fourth quarter, BSP Governor Eli M. Remolona, Jr. earlier said.

“Upcoming monetary policy easing will bode well for NG’s borrowing plan because it will now be cheaper,” Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said.

Apart from monetary easing, the country’s investment grade ratings will help support cheaper borrowings.

“The recent upgrade and affirmation of current credit ratings from the aforementioned ratings agencies gives the NG more borrowing opportunities abroad,” Mr. Asuncion said.

Last week, Moody’s Ratings affirmed the Philippines’ investment grade rating of “Baa2” with a “stable” outlook. The country also holds ratings of “BBB” from Fitch Ratings and “BBB+” from S&P Global Ratings.

“If the NG continues with its consolidation plan and follows through, the A-rating is very possible. Simply put, the coveted A-rating is really doable and reachable,” Mr. Asuncion said.

Philippine Institute for Development Studies Senior Research Fellow John Paolo R. Rivera said upgraded credit ratings will help the country attract investments and support overall growth.

“Upgrades in investment grade ratings of the Philippines will allow our government to position the economy as an investment destination, given stabilizing macroeconomic indicators, relaxing of interest rates in the foreseeable future, and ability of the government to support a conducive investment environment,” he said.

The government is aiming to achieve an “A” rating status by the end of the administration or by 2028.

“Should the Philippine economy continue to demonstrate stable macroeconomic fundamentals, the economy is on track to achieve successive rating upgrades,” Mr. Rivera said.

Budget gap shrinks in July

Heavy traffic is seen along the southbound and northbound flyover on Roxas Blvd. due to road construction, April 6, 2024. — PHILIPPINE STAR/RYAN BALDEMOR

THE NATIONAL Government’s (NG) budget deficit sharply shrank in July as revenues posted double-digit growth, the Bureau of the Treasury (BTr) said.

Data from the BTr on Wednesday showed that the budget gap narrowed by 39.67% to P28.85 billion in July from P47.81 billion in the same month a year ago.

Month on month, it shrank by 86.2% from the P209.08-billion deficit in June.

National Government fiscal performanceIn July, revenues increased by 11.09% to P457.37 billion from P411.73 billion in the same month last year.

Broken down, tax revenues climbed by 15.46% to P402.82 billion in July from P348.88 billion in the same month in 2023. This made up 88% of total revenues, the BTr said.

The Bureau of Internal Revenue’s (BIR) collections increased by 17.09% to P319.81 billion in July, which is net of a P175-million tax refund.

Collections by the Bureau of Customs (BoC) went up by 9.99% to P80.36 billion, net of a P645-million tax refund, in July.

Tax revenues from other offices declined by 1.38% to P2.65 billion in July.

Meanwhile, nontax revenues in July fell by 13.2% to P54.55 billion from P62.77 billion in the same month a year ago.

BTr said its income slumped by 60.82% to P19.91 billion “primarily due to the BSP’s (Bangko Sentral ng Pilipinas) one-off remittance of P31.9 billion last year, as well as reduced income from BTr-managed funds and NG deposits.”

Collections from other offices surged by 188.2% to P34.6 billion in July.

Meanwhile, state spending rose by 5.8% to P486.22 billion in July from P459.54 billion a year ago “partly due to the higher National Tax Allotment (NTA) share of local government units (LGUs),” the BTr said.

Interest payments jumped by 24.99% to P79.43 billion in July from P63.55 billion a year prior.

“This was due to the higher cost of financing and depreciation of the peso observed throughout the year,” BTr said.

Data from the Bankers Association of the Philippines showed that the peso appreciated by 24.5 centavos to P58.365 per dollar as of end-July from P58.610 per dollar as of end-June.

Primary spending — which refers to total expenditures net of interest payments — went up by 2.73% year on year to P406.8 billion in July.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the narrower deficit “may largely have to do with improvement in recurring tax revenue collections by the BIR with no more coronavirus pandemic restrictions for more than a year.”

The Finance department reported on Tuesday that the budget deficit widened by 7.21% to P642.8 billion in the first seven months of the year as revenue growth outpaced expenditures.

The fiscal gap is expected to narrow in the coming months if the NG continues to see double-digit revenue growth, Union Bank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said.

“The better news is that the government has leeway to allot more for primary expenditures versus interest payments if the narrowing trend continues,” he said in a Viber message.

The Philippine and US central banks’ expected rate cuts should help narrow the budget shortfall, Mr. Ricafort said.

IMPROVEMENT
Meanwhile, the deficit-to-gross domestic product (GDP) ratio averaged 4.87% in the first six months of 2024 from 4.8% a year ago. This is still below the government’s deficit ceiling of P1.48 trillion, equivalent to 5.6% of GDP.

Revenue effort improved to 17.06% as of end-June from 16.17% a year ago. This was above the government’s programmed 16.12% revenue-to-GDP ratio for 2024.

Revenue effort covers the share of tax revenues, nontax revenues, and other government revenues in relation to GDP.

Tax effort inched up to 14.57% in the first half from 14.5% a year prior. Tax effort refers to total tax revenue, including social security contributions, as a share of GDP.

Expenditure effort jumped to 21.94% as of end-June from 20.96% last year. It was higher than the 21.72% programmed spending-to-GDP ratio for the year.

Expenditure effort refers to the share of spending on public goods and services to GDP. — B.M.D.Cruz

Analysts flag possible wasteful spending ahead of 2025 elections

Residents fill up forms as they reactivate their voter’s registration at a school in Barangay Sangandaan, Quezon City, Aug. 26, 2024. — PHILIPPINE STAR/MIGUEL DE GUZMAN

By Kenneth Christiane L. Basilio, Reporter

THE PHILIPPINE government is expected to put in billions of pesos in wasteful spending to curry favor with voters ahead of midterm elections next year, analysts said.

The ability of incumbent politicians to boost public spending or money aggregates to satisfy voters could stoke inflation, they added.

“Sitting politicians may use government funds that are directed toward influencing voting preferences… this is assumed to cause a surge in infrastructure projects, provision of goods, and proliferation of services-based initiatives,” Arjan P. Aguirre, who teaches political science at the Ateneo de Manila University, said in a Facebook Messenger chat.

Midterm elections are scheduled on May 12, 2025, when Filipinos will elect senators, congressmen and local officials.

The polls are still less than a year away, but there has been a noticeable increase in state spending on infrastructure so far this year.

State spending on infrastructure and other capital outlays jumped by 20.6% to P611.8 billion in the first half of 2024 from P507.2 billion a year ago, as the Public Works and Transportation departments sought to speed up completion of projects.

“Road and bridge constructions and rehabilitation, medical assistance and missions, educational allowances and scholarship funds, and feeding projects tend to rise in election years,” Mr. Aguirre said.

The Commission on Elections (Comelec) puts in place a ban on the release, disbursement and spending for public works and social welfare projects ahead of elections. The Comelec has set the election period from Jan. 12 to June 11, 2025.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said he expects infrastructure spending to rise further in the second half.

“A possible increase in government spending to prepare for the May 2025 midterm elections could already start in the latter part of 2024, accelerating government spending on infrastructure and other projects, which could be a source of additional growth for the local economy,” he said.

The Philippine economy often sees a boost in years when there are elections, especially presidential polls, according to John Paolo R. Rivera, senior research fellow at state think tank Philippine Institute for Development Studies.

“An election season usually boosts economic growth figures due to campaign spending of all candidates including their donors, supporters, and benefactors,” he said in a Viber message, attributing it to heightened consumption.

Philippine gross domestic product (GDP) in 2022 — a presidential election year — grew by 7.6% from 5.7% in 2021.

In 2016 when presidential elections were also held, GDP expanded by 7.1% from 6.3% in 20215.

The bulk of economic activity during election years are from industries that mobilize and support election efforts, including “public relations firms, manpower services, air and land transportation, and food services,” said Mr. Aguirre.

Mr. Ricafort said companies involved in consumer goods, fastfood and media also typically see a boost during elections.

Increased spending by politicians ahead of or during elections may also fuel inflation.

Candidates gunning for a government post also ramp up spending on campaign materials and advertisements to improve their chances of being elected, Leonardo A. Lanzona, an economics professor at the Ateneo de Manila University, said.

“The most likely result is inflation and wasteful spending that could have gone to more productive programs,” he said, referring to spending by politicians.

He said the widespread but illegal practice of vote buying during elections could also fan inflation.

“The informal sector is the recipient of all these dole outs… as a collective, this will contribute significantly to greater inflation,” Mr. Lanzona said.

The central bank sees inflation averaging 3.4% this year and 3.1% in 2025.

The government should strictly monitor the campaign finances of election candidates, Mr. Lanzona urged, citing that most of them are not following a 1991 law that limits election spending.

Metro Retail beyond the horizon: A new era of expansion and innovation

Metro Retail Stores Group, Inc. distribution center in Santa Rosa, Laguna

Metro Retail Stores Group Inc. (MRSGI) is making significant strides in its growth journey, marking a transformative era of expansion and enhancement across the Philippines. From expanding its store locations to launching innovative support programs, MRSGI continues to enhance its role in the retail sector, demonstrating a strong commitment to operational excellence and community development.

“Our expansion strategy reflects careful planning and a dedicated focus on addressing the evolving needs of our customers and communities. Each new store and facility are crafted to enhance accessibility, support local economies, and foster sustainable growth,” said Manuel Alberto, president and chief operating officer of MRSGI.

Strategic Expansion to Serve More Communities

Manuel Alberto, president and chief operating officer of MRSGI

MRSGI’s strategic expansion is evidenced by the recent groundbreaking of six new store locations in Cebu, Leyte, and Biliran. This initiative is set to enhance the accessibility and convenience of Metro’s services for local communities, contributing to the improvement of the quality of life for residents. These new stores are a testament to MRSGI’s dedication to extending its reach and ensuring that exceptional retail experiences are available to a broader market.

Adding to this growth is the inauguration of a state-of-the-art distribution center in Santa Rosa, Laguna. This modern facility, spanning three hectares, is equipped with advanced features such as selective racking systems and solar panel-ready infrastructure. With a capability to handle up to 25,000 cases daily for both inbound and outbound processes or a maximum throughput of 1.5 million cases monthly, this distribution center will significantly bolster MRSGI’s supply chain capabilities and support its expansive network of stores.

“Our new distribution center is a crucial part of our growth strategy,” Mr. Alberto remarked. “By investing in advanced infrastructure and sustainable practices, we are enhancing our efficiency and ensuring we can meet the needs of our growing network. This facility represents our ongoing commitment to operational excellence and community support.”

Innovating and Supporting Local Enterprises

Photo shows MRSGI President and Chief Operating Officer Manuel Alberto and employees showcasing the benefits for businesses at the launch of the Mareng Ems program.

MRSGI’s commitment to innovation extends beyond physical expansion. The introduction of the Mareng Ems Program exemplifies MRSGI’s dedication to fostering robust business partnerships. This comprehensive support system offers various benefits to businesses within the Sari-sari Store and Hotel, Restaurant, and Catering (HoReCa) sectors. Through the Metro Business Club (MBC) membership, partners gain access to rewards, rebates, and essential services, reinforcing MRSGI’s role as a reliable ally in their growth journey.

The Bayanihang Metro Caravan is another key initiative, exemplifying MRSGI’s dedication to local entrepreneurs. In collaboration with the Department of Trade and Industry (DTI), this program provides a platform for micro, small, and medium enterprises (MSMEs) to showcase their products at major festivals across the Visayas and Luzon. This initiative offers local businesses valuable exposure and contributes to their growth by providing resources and support.

“Our various programs and initiatives are designed with one goal in mind: to foster growth and create opportunities. Whether it’s through innovative support systems or community-focused events, we are committed to empowering businesses and driving sustainable development. These efforts are integral to our vision of being a catalyst for positive change in the retail sector,” Mr. Alberto stated.

Expanding Horizons with New Retail Formats

Metro Value Mart in Lancaster New City Gen. Trias, Cavite

As part of its strategic expansion, MRSGI has introduced a new neighborhood mini-mart format, Metro Value Mart, in Lancaster New City General Trias, Cavite. Developed in response to consumers’ growing preference for convenient, close-to-home shopping options, Metro Value Mart is designed to cater to the daily needs of local residents with a curated selection of international and local goods, general merchandise, home care products, health and beauty items, and fresh and frozen foods.

Additionally, MRSGI has recently launched the Metro Home Improvement store at Marquee Mall, Angeles. This new format aims to meet the demands of homeowners and DIY enthusiasts by providing a broad range of home improvement products, tools, and materials. The store’s extensive selection, including hardware, home decor, and gardening supplies, caters to those looking to enhance their living spaces.

Expanding into specialized retail formats such as Value Mart and Home Improvement supports MRSGI’s broader strategy of diversification. By offering a variety of shopping experiences tailored to specific customer needs, MRSGI aims to address new market segments and enhance its presence in the retail industry. This approach also highlights the company’s adaptability to emerging trends and shifting consumer preferences.

Metro Home Improvement store in Marquee Mall, Angeles

“Building on the launch of our mini-mart and home improvement formats, we are focused on identifying opportunities to introduce these concepts in key regions across the country. Our objective is to broaden the accessibility of Metro’s diverse shopping experiences and to align with evolving customer preferences,” said Alberto.

A Vision for the Future

“With a current network of 64 branches and an ambitious goal to reach 160 stores by 2027, MRSGI is dedicated to sustainable growth and innovation. As we expand, our focus remains on enhancing service quality, supporting communities, and driving customer satisfaction. Our commitment to thoughtful expansion, innovation, and community engagement guides us as we build on our strong foundation and aim to positively influence the retail landscape,” concluded Mr. Alberto.

As MRSGI forges ahead, its commitment to growth and enhancement remains unwavering, promising exciting developments and opportunities for both the company and the communities it serves.

 


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South Luzon draws BPO firms with talent, infra — Colliers

BW FILE PHOTO

THE OFFICE market in South Luzon is attracting business process outsourcing (BPO) firms due to the availability of local talent, infrastructure, and the advantage of being located outside the capital’s traditional business districts, according to Colliers Philippines.

“There are BPOs that are actively and consciously veering away from traditional business districts in Manila and have made it a point, as part of their core site selection strategy, to not be in Manila. Instead, they are locating in the fringes of Manila where the people actually live,” Colliers Associate Director for Office Services Kevin R. Jara said during a briefing on Aug. 27.

Among the BPO companies that occupy office space outside the traditional central business districts are iQor, Concentrix, Appen, Teleperformance, and TaskUs, according to Colliers Philippines.

Mr. Jara said talent availability and infrastructure remain top considerations for locators. Cavite, Laguna, and Batangas (CALABA) have a combined population of 10 million people, with 4.8 million in the working-age group.

Office buildings integrated with retail are becoming popular among BPO companies seeking office space in South Luzon, he said. 

He also noted that such buildings typically achieve higher occupancy rates compared to standard office buildings. Examples include Megaworld Corp.’s Southwoods BPO Tower 1 and 2, SM Holdings Inc.’s The Core Towers 1-3, and Ayala Land, Inc.’s One & Two Evoctech.

“The average occupancy rate of office buildings here in Southern Luzon that are attached to retail or commercial developments is typically about 80%,” Mr. Jara said, “compared to below 50% for standalone buildings.”

“The office market here in CALABA is just a small market, and we just recorded 5,000 square meters (sq.m.) over the past six months for this particular area,” he also said.

South Luzon also benefits from infrastructure projects like the Light Rail Train 1 Cavite extension, Skyway 3, and the South Luzon Expressway, which could further increase land and property values in the region, Colliers Philippines said.

Mr. Jara also noted that office space transactions in the Philippines are still concentrated in Manila, which accounted for 79% of transactions in the first six months of 2024, while provincial areas accounted for 21%.

Colliers Philippines reported a total of 122,000 sq.m. in office space transactions for the first half of 2024, up from 88,000 sq. m. in the same period last year. This increase was driven by activity in Cebu, Pampanga, and Iloilo.

Joey Roi Bondoc, director and head of research at Colliers Philippines, noted that the Cavite-Laguna-Batangas-Rizal-Quezon (Calabarzon) region accounted for 15% of deployed migrant workers in 2022. Given this, it is “not surprising” that developers are “aggressively” land banking and launching projects in the region, where many recipients of cash remittances are located, he added.

He also noted that the time required to fully absorb condominium units in Metro Manila has increased, meaning it now takes longer to sell these units. However, demand for horizontal developments remains consistently strong.

“This means there’s a strong appetite for the horizontal segment, especially for the Southern Luzon region where you have OFWs and local investors that are still investing in this household lot and lot-only developments,” he added.

In addition, due to the “strong demand” for horizontal units in the CALABA corridor, the average price of a house and lot unit is P4.7 million, which has been increasing by approximately 7.2% annually from 2016 to 2020, Colliers Philippines said.

“In the lot-only segment, we are also observing strong demand for horizontal properties. The average price per square meter is approximately P19,000, which results in an annual growth rate of about 6.7%,” Mr. Bondoc said. — Aubrey Rose A. Inosante

An Emperor’s Table laden with ingredients from a place of exile

WASABI beef cheek wagyu pistachio, green bamboo shoot.

THE ANNUAL visits of celebrity chef Jereme Leung (he was on MasterChef China, and is a two-time recipient of the Five Star Diamond Award by the American Academy of Hospitality Science) to his restaurants around the world (in eight cities in six countries) means special menus when he drops by, and he does exactly that with The Emperor’s Table, a special menu at China Blue by Jereme Leung at Conrad Manila.

When we think of imperial dining, we think of gaiety and gilding. However, the emperor at this table is someone wiser and more sedate, as proven during a tasting on Aug. 22 at the Conrad.

For starters, we had Marinated crabmeat with avocado in crispy puff roll, and Marinated sweet plum drunken King Prawn. The roll became an afterthought to the prawn, served at a lower temperature the better to release its more natural flavors. The result was a large shrimp so fresh it felt like it had just been plucked out of the water.

A second course of soup (Double-boiled sturgeon tendon and dry sea conch with morel mushroom Kung Fu soup) was savored by guests in silence: so much so that a late guest thought we had been at prayer. We might well have been: the soup’s flavor was almost meditative in its cleanliness; and despite all the ingredients in it, tasted almost Buddhist in its austerity.

The main dishes were Wasabi beef wagyu pistachio, green bamboo shoot, Pan-fried black cod with torched ginger flower gravy sauce and pomelo, and Braised Yin Yang rice with dry scallop and dry fish maw, and oyster ginger taste.

The beef collapsed with the slightest tap of a knife, and displayed a great combination of earthiness and sweetness, with a zing from the wasabi. Its texture was sticky and succulent (the beef coming from gelatinous beef cheeks). We felt bad for eating it too quickly, for this dish deserves to be savored.

The black cod, meanwhile, was a contrast to the beef. While its base had a mild texture, it had an aggressive and spicy taste from the ginger flower buds. The final savory course (as per Chinese tradition) was rice, and he made that with orzo (a rice-shaped pasta) and Tibetan rock grains grown 3,000 meters above sea level. The dry scallop and fish maw lent oceanic flavors to this meeting of earth and sky (and the grain itself lent creaminess). The meal ended with coconut mousse and mango puree encased in an enormous chocolate eggshell.

YUNNAN
During the lunch, Mr. Leung remarked that the mushrooms in the soup came from China’s Yunnan province, which according to him, produces about 80% of the world’s fungi. It also has a reputation for being the birthplace of tea drinking, and cannabis. Yunnan’s capital city, Kunming, was one of China’s capitals during the Second World War.

“Kunming used to be a place where they sent officials who fell into disgrace. If they didn’t chop your head off, they sent you to Kunming, almost to the edge of China… living in Kunming would be like hiding in a secret spot where no one could find us,” said Jiang Weili, the main character in Amy Tan’s The Kitchen God’s Wife. Mr. Leung concurred, saying, “Anybody that the Emperor didn’t like, if they could put you into the farthest end of the world, that is Yunnan.”

“Today, of course, it’s no longer like that. But Yunnan produces a lot of ingredients that you can’t cultivate,” he said. We noted his attachment to Yunnan after remembering that this was the second time that Yunnan ingredients were featured in one of his menus (a few years ago, he had placed Yunnan rose petals in ice cream).

“It’s huge, full of natural forests, full of natural things. And a lot of things are not very well-known outside. It serves as an inspiration for me,” he said of the province.

We did note the quiet nature of this menu, compared to the gaiety and frou-frou we might have expected from an emperor’s table. In the end, however, the dishes that did appear on our plates proved to be more substantial. The chef explained: “I think food in itself is not about the most expensive… the rarest. The ingredients that I pick every time when I do a menu is about what is interesting.

“Not necessarily the finest caviar, the rarest wine — good food is never about that. Good food is about what arouses people’s interests. It’s about the thought that was in the preparation.”

The set menu is priced at P6,588 net per person, and will be available for both lunch (11 a.m. to 2:30 p.m.) and dinner (6 to 10 p.m.), daily until Sept. 30. For inquiries and reservations, call 8833-9999, 0917-650-4043, or email MNLMB.FB@ConradHotels.com. — Joseph L. Garcia

PHL developers to see increased buyer demand as rates go down

Condominium buildings are seen in Manila amid dark rain clouds, April 14, 2023. — PHILIPPINE STAR/MIGUEL DE GUZMAN

PROPERTY DEVELOPERS in the Philippines are expected to see increased buyer demand and more affordable financing options for projects as borrowing costs decline, according to consulting firms.

“As key policy rates go down, borrowing costs will also go down for both the developers and the buyers,” Sharon R. Saclolo, head of research at Leechiu Property Consultants, Inc., said in an e-mail interview on Aug. 27.

“This should have a positive impact on the real estate market because it will increase liquidity, meaning more money can be spent to invest in real estate,” she added.

The residential property sector saw a slight decline in total residential real estate loans (RRELs) in the first quarter of the year.

The total granted RREL fell 9% to 9,064 for the first quarter of 2024 from 9,975 loans in the fourth quarter of 2023, according to Leechiu, citing Bangko Sentral ng Pilipinas (BSP) data.

This month, the BSP lowered benchmark interest rates for the first time in nearly four years, citing an improving inflation outlook and strengthening economic conditions, with its governor indicating that at least one more rate cut could occur before the end of the year.

The Monetary Board lowered its target reverse repurchase rate by 25 basis points (bps) to 6.25%, a move anticipated by nine out of 16 analysts in a BusinessWorld poll. BSP Governor Eli M. Remolona, Jr. has indicated that another rate cut of 25 bps could be implemented within the year. The remaining policy-setting meetings of the Monetary Board for 2024 are scheduled for Oct. 17 and Dec. 19.

With the BSP signaling the possibility of an additional rate cut before the end of the year, prospective homeowners may be more inclined to enter the market sooner rather than later, anticipating more favorable borrowing conditions, according to analysts.

“That should fuel the take-up for condominium units, especially in Metro Manila for the mid-income segment, P3.6 to 12 million, which is the most sensitive right now to interest rate spikes,” Joey Roi Bondoc, director and head of Research of Colliers Philippines, said in an interview with BusinessWorld.

He noted that while demand remains somewhat stable, it has not yet reached pre-pandemic levels. The interest rate cut is expected to “definitely jump-start” the infusion of “much-needed confidence” in the residential market.

Mr. Bondoc also expressed hope for additional rate cuts toward the end of the year and into 2025.

Similarly, lower credit card interest rates may boost consumer spending, leading mall operators to expand and occupy larger retail spaces, he noted.

He also said that this renewed interest in the retail sector could attract more foreign retailers to the Philippines, leading to an increase in new store openings.

“And while those that are already here, they might even find that as an impetus to expand brick-and-mortar spaces,” he added. — A.R.A. Inosante

Give my regards to Ho-land

HO-LAND HOPIA Binondo branch. — HO-LAND HOPIA FACEBOOK PAGE

THE GHOST month was not even in yet when a fire struck a famous street corner in Binondo, Carvajal corner Nueva (now Yuchengco), early on the first Friday of August, resulting in 11 deaths, mostly boarders of a dormitory in the upper floors of a building that also housed Ho-land Hopia and Chinese deli on the ground floor, which also wasn’t spared.

Among the dead were two coast guard trainees possibly about to wrap up studies in one of the merchant marine schools that sprout like mushrooms in that part of town, like the spaghetti electric wires and cables above the shops and residences; the wife of the building owner; as well as a cashier or other workers in nearby establishments, maybe including Ho-land, in the city to earn enough to occasionally send money home to the province.

Carvajal Street of course is no stranger to habitues of the noble and ever loyal city, surely part of walking tours of travel agency brochures, being just a stone’s throw away from Ongpin and its famed Binondo church fronting the plaza at Quintin Paredes and the first Filipino saint Lorenzo Ruiz doing battle with the ghost of ages.

Anak ng hopia” was an expression unique to the old man, in fact it was only from him I heard it, a variation from the more popular, surely less savory, interjections of similar construction, and which you could also repeat after me — anak ng hopia — upon seeing the sprawling cornucopia of vegetables and fruits among other exotic foodstuff in the alley of Carvajal, named perhaps after the ancestors of showbiz columnist Dollywood and the tallest basketball player of his time that gave Jose Rizal University its last NCAA championship back when it was still a college on Shaw.

It was in that bountiful alley, so typical of the maze and labyrinths of the world’s oldest Chinatown, where we sometimes shopped on special occasions or merely as a foray or side trip when the office was in nearby Port Area, for the medicinal ulikba always sold in pairs, chicken so small and so black and so tasty shouldn’t be lonely, as well trays of freshly sorted langka, random memory chestnuts, anonas fruit rare as the holy grail, but always don’t forget to drop by Ho-land for the incomparable hopia otaosa or black mongo, the origs yellow mongo and baboy with their vintage paper wrappers long before the franchise experimented with other hopia flavors including ube and the best kept secret kondol or winter melon.

Such a trip would not be complete without a quick meal at the carinderia at the corner of Nueva and Ongpin, with its comfort food of kiampong and camto, ice cold soda on the side, to nourish oneself before the long walk to the LRT through scenic Escolta and the since shuttered Book Sale, or even hitch a ride on the Pasig river ferry, which now you see now you don’t.

Ho-land may have been best known for its hopia, and rightly so as these taste buds consider it head and shoulders above the competition, but it also had other products worthy of merienda or pasalubong, the typical pantawid gutom before the meal proper comes along or even never arrives, like the assorted empanadas with filling ranging from kuchay and mushrooms to chicken a la king and beef curry — all going at a bargain after 6 p.m. Also the phased-out chicken galantina that regaled many a family reunion spread, an assortment of machang, string color-coded whether pork, chicken, or a combination of both and/or with mushroom. Not to forget the gabi or radish cakes, slices of which are ready for frying.

Correct me if I’m wrong but wasn’t the original Mei-ling restaurant located in a Carvajal alley, a mere hole in the wall amid the overflowing merchandise, before it branched out to wealthier more accessible abodes in Megamall and Jupiter Street and other commercial spots? It was in such a nondescript place where we took the father-in-law for merienda of Schezwan noodles, after an adventure in nearby Sto. Cristo and Blumentritt in search of a crankshaft or similar major spare part for a passenger jeepney in Negros province. Comfort food gives me hope.

The hopia of the fatherland can’t be diminished by 11 deaths, though at times this recollection of so much food may leave a bad taste particularly for the bereaved — our condolences. But with ghost month well in I am thinking of taking a trip down to Pioneer Center to see whether the Ho-land deli branch has reopened — its metal gates were drawn down and padlocked the weekend after the fire. Just curious to see if the otaosa can rise from the ashes, as well it should, sesame seeds in the flaky pastry tasting like heaven, far and away from the hubbub of Binondo.

Glossary

hopia – a small bean-filled moon cake-like pastry

anak ng hopia – son of a hopia

ulikba – a breed of chicken with black feathers and meat

langka – jackfruit

anonas – sugar apples

mongo – mung beans

baboy – pork

ube – purple yam

carinderia – streetside restaurant

kiampong – glutinous rice casserole

camto – flank steak

merienda – afternoon snack

pasalubong – take-home gift

pantawid gutom – something to stave off hunger

empanadas – stuffed pastries

kuchay – Chinese chives

galantina – stuffed chicken

machang – stuffed glutinous rice packets

 

Juaniyo Arcellana is a semiretired/senior desk editor at BusinessWorld’s sister publication The Philippine Star. Thirty years ago he had a sports column called The Mopman in BusinessWorld.

SM Prime’s FourE-Com Center: Innovative form and function in an office complex

The FourE-com Center has slopes that allow more sunlight to penetrate the podium, as well as to create more viewpoints across the building.

SM Prime Holdings, Inc. has been at the forefront of creating innovative and sustainable property developments that enhance the quality of life for Filipinos. As the demand for office spaces continues to evolve and adapt to “new ways of working,” SM Prime is ready to meet the needs of the corporate and business processing sectors with FourE-Com Center.

Located in the thriving Mall of Asia Complex, SM Prime’s FourE-com Center is an office complex comprised of three 15-storey towers spanning more than 103,000 sq.m. of leasable space. The development is the perfect answer for businesses looking for a premier office base in a prime location.

An Architectural Marvel

Awarded Best Office Architectural Design 2023 at the 11th Property Guru Philippines Property Awards, FourE-Com Center is truly an architectural gem. The three-tower Pre-LEED Gold-certified edifice stands out for its sapphire crystal-like structure designed to give FourE-Com Center a strong identity. This majestic design is not arbitrary either. The building’s slopes not only allow more sunlight to penetrate the podium where the infrastructure stands, but also create more viewpoints of the sea and surrounding environ.

Designed for Today’s Businesses

SM Prime’s FourE-com Center’s sapphire crystal-like structure is designed to give the building a strong identity among other buildings in the Mall of Asia Complex.

From the outside in, FourE-Com Center’s meticulous design shows. The office’s strategic location puts it in the heart of a bustling district that makes it a more accessible and convenient workplace for office workers. The center is only 9 kilometers from the South Luzon Expressway’s Nichols Toll Plaza and even closer to the Ninoy Aquino International Airport. Within the MOA Complex, too, is the National University MOA Campus, giving SM Offices business partners easy access to a rich talent pool.

SM Offices Business Unit Head Alexis Ortiga adds, “We also put a priority on employee conveniences. Through a network of elevated walkways, FourE-com Center is strategically interconnected to the MOA Complex. This means easy access to other amenities and facilities, such as the Mall of Asia, SMX Convention Center, SM MOA Arena, SM by the Bay, and transport terminals among others.”

Fusing industrial and modern styles, the FourE-com Center’s interior design is crafted to meet current tenant pre-requisites and create a cohesive aesthetic. Each tower’s entrance lobby is elegantly lined with marble, while the office floors boast of floor-to-ceiling glass windows that provide tenants with an unobstructed view of the picturesque Manila Bay.

Energy-saving systems are implemented in the center by utilizing natural light, energy-efficient LED lighting, water-efficient fixtures and aerators, and motion-activated escalators. Water and waste management systems are also in place to ensure that non-potable water and wastes are recycled. Other low-carbon footprint features in the complex include an electric vehicle charging station, bike racks, and even a Trash-To-Cash Program.

With plans to expand its offerings, the FourE-Com Center’s fifth-level open-air sky garden will introduce more amenities by the third quarter of 2024, including outdoor work spaces, free Wi-Fi, and multi-purpose outdoor event spaces for tenant-centric activities, such as exercise classes and holiday parties. These amenities are sure to add to the allure of FourE-Com Center, providing businesses an inspiring work environment tailored for today’s dynamic work culture.

Experience Growth in a Premier Office Space

For businesses looking to occupy one of its spaces, FourE-Com Center has floor plates ranging from 2,500 to 3,000 sq.m., allowing BPOs and corporate markets to choose from a selection of sizes. These office spaces are also offered in bare-shell condition, allowing tenants the liberty to customize their environments according to their specific needs and preferences.

“SM Offices continues to set the standard in office developments. Advancing innovative and sustainable solutions that cater to the evolving needs of the modern workplace, SM Offices facilitates the growth and success of business enterprises in a premier and strategically located office complex,” said Ortiga.

For more information on FourE-Com Center and other office developments from SM Prime, visit https://www.smoffices.com.

 


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S&P upgrades Meralco’s credit rating to ‘BBB’

PHILSTAR FILE PHOTO

CREDIT WATCHER S&P Global Ratings has upgraded Manila Electric Co.’s (Meralco) credit rating to “BBB,” noting the company’s strong financial position and steady cash flow.

“We raised our long-term issuer credit rating on Meralco to ‘BBB’ from ‘BBB-’,” S&P said in its report on Meralco’s credit upgrade e-mailed to journalists on Wednesday.

A “BBB” rating indicates that Meralco has an adequate capacity to meet its financial commitments but remains more vulnerable to adverse economic conditions.

S&P affirmed a stable outlook for Meralco, reflecting expectations of steady cash flow from its regulated distribution business and prudent management of leverage and growth spending over the next 12-24 months.

“We expect financial ratios to remain strong, despite heavy capital spending on the power generation businesses,” S&P said.

The agency anticipates Meralco will maintain a strong ratio of funds from operations (FFO) to debt of 39% to 45% over the next two years, surpassing the previous 30%.

S&P said that Meralco’s support will come from improving profitability in power generation and steady cash flow from distribution.

The agency also noted favorable power purchase agreement contract terms for Global Business Power Corp. (GBPC) and additional earnings from the local contingency reserve market.

Meralco is expected to undertake capital spending of approximately P120 billion in 2024 and P30 billion to P40 billion in 2025, including acquisitions. This includes sizable distribution-related growth capital expenditure of P23 billion to P25 billion annually for network strengthening and asset renewal.

Additionally, Meralco plans to ramp up investments in power generation assets, including renewables, over the next two to three years.

The company has announced a proposed joint venture with Aboitiz Power Corp. to invest in two gas plants of San Miguel Corp. and a liquefied natural gas import terminal, with an expected cost of P70 billion to P75 billion for its effective 40.2% stake.

Meralco will likely provide capital injections of up to P40 billion to SP New Energy Corp. for a 3.5-gigawatt Terra Solar Project over the next two to three years. The actual capital spending will depend on the project’s final financing and ownership structure.

S&P cautioned that it could lower Meralco’s rating if the company’s ratio of FFO to debt declines sustainably below 30% or if its financial policy becomes more aggressive.

POWER SUPPLY DEALS
Meralco expects a “swift” approval of its power supply agreements (PSAs) from the Energy Regulatory Commission (ERC) so that customers can enjoy lower rates, a company official said on Wednesday.

The power distributor recently announced that it had secured the best bids from two generation companies, San Miguel Global Power Holdings Corp. and Aboitiz Power Corp., following a competitive selection process (CSP) for 600 MW of baseload capacity.

“We are happy that the main objective of the CSP, which is to secure the least cost supply for our customers, has been achieved. We hope that there will be no further delays as we work towards immediate signing of the PSAs resulting from the 600-MW CSP,” Meralco Senior Vice-President and Regulatory Management Head Jose Ronald Valles said in a statement.

“We trust that ERC evaluation and approval will also be swift so customers can enjoy these very low rates upon scheduled delivery date in August 2025,” he added.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT, Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera

No longer just the past

REENACTORS in corporate setting.

Every time I visit Mum to check on her, I find her seated in front of a television set or her laptop, her eyes glued to some historical drama series on NHK.

One flick which I watched with her was about one of the Meiji Restoration’s top reformers. It has never ceased to amaze me that an ordinary Japanese like her could rattle off milestones and key dates in the lives of that country’s heroes or historical organizations, and explain their significance to life in her homeland today.

Chances are that many of us Pinoys have perceived a general lack of interest among our countrymen in our origins as a nation. This was so long before kids asked actor Jeffrey “Epy” S. Quizon why Apolinario Mabini — the hero he played in the 2015 historical flick Heneral Luna — was portrayed seated throughout the film. True, Mabini was not an invalid since birth, losing use of both legs only in his early 30s after contracting polio in 1895, but the disease had incapacitated him by the time the Philippine Revolution ignited the following year.

It is a flaw that some foreigners have noticed. One visiting Brit who joined me on a historical tour in Quezon province in the early 2000s said that he would never fail to take his two half-Filipino daughters on similar excursions whenever his family visited this country, as he lamented a general lack of familiarity among many Pinoys with their own history.

I have yet to come across research explaining the link between historical consciousness, patriotism, and socioeconomic development (there must be one, of course), but there seems to be enough of a casual correlation for governments to appeal to patriotism as they remind their constituents to fulfill their civic duties like paying the right amount of taxes.

AWARENESS ERODED
Ricardo T. Jose — a graduate of Tokyo University who has been teaching history for decades at the University of the Philippines in Diliman, Quezon City and specializes in the Philippine Commonwealth period, the Japanese occupation of the Philippines, Japan-Philippine relations, and Philippine diplomatic history — said in a recent chat that a sense of history “gives you perspective” in dealing with current socioeconomic and political issues.

“History… enables you to better appreciate where you stand today, whether you are better or worse off. How can you prepare for the future if you have no basis to appreciate what the present is all about?” he said.

“Aside from giving you a sense of perspective, it also gives you a sense of pride, a sense of belonging. You are part of a bigger picture and a continuing evolutionary trend.”

He noted, however, that “the level of [historical] awareness of our people has gone down” over the years.

The problem lies, perhaps, in the way History is taught, especially amid the confluence of factors like the proliferation of misleading information on the internet, and the fact that younger generations no longer read and have generally poor comprehension.

“People just no longer read, and without reading, you do not get to appreciate what we have,” Mr. Jose said, adding that “students are just not interested” in history.

And this comes at a time of disinformation, historical revisionism, as well as information on the internet that is generally “biased” for the developed world’s perception of history.

Since he began teaching in 1979, he said that he has had to supplement lectures with “articles students could see and touch,” to the point that he would occasionally bring artifacts or even occasionally don period costumes for his lectures. The need for more visual modes of instruction has just grown over the years.

“Today’s generation is visually oriented, but how do one visualize ideas like the philosophy of History?”

ENTER HISTORICAL REENACTMENT
One phenomenon that could prove useful in addressing this situation is the proliferation of historical reenactors.

Beginning with a group of professionals — none of them career historians — who formed the group Buhay na Kasaysayan (Living History) in the early 2000s that would reenact events in the Philippine Revolution and Philippine-American War, there are now similar groups scattered across Metro Manila and the Visayas (check out the likes of the Renacimento Manila cultural group, as well as the Republica Filipina Reenactment Group and Historia Viviente Manila on Facebook).

Composed of professionals and students who share a zest for Philippine history — especially the Philippine Revolution, the First Philippine Republic, the Commonwealth period, and the Second World War — a few of these volunteer groups have been recognized by some local governments and offices like the Intramuros Administration and the Armed Forces of the Philippines which have tapped them to add color to ribbon cuttings, conferences, and other events.

Even as Mr. Jose said some reenactments seem to be little more than cosplay for some participants, others “can be very concerned about accuracy.” The reenactors can be very knowledgeable about particular details of Philippine history, and use the reenactments as a platform to show the results of their personal research.

Mr. Jose said he himself has invited some reenactors to basic History classes, describing this as “a learning tool” that has captivated students. “It is a limited way of showing history, but it inspires people to read more,” he said, recalling that one spectator had told him once that “if you teach history that way, then more people would be interested.”

STARTING POINT
So it is a starting point for becoming more aware of Philippine history and its contemporary significance. Hopefully, it goads spectators to read more or even do their own research. That way, they learn to be more discriminating and deal better with the flood of information — both truth and errors — on the internet.

One of the original reenactors, Pedro Antonio V. Javier — a practicing electronics and communication engineer with an MBA — would attend Dec. 30 ceremonies in the City of Manila dressed as Jose Rizal, or as Mabini on some other occasions. He even appeared as the First Philippine Republic officer who barked a command at the funeral procession near the closing scenes of Heneral Luna. Reenactment is a family affair for him, with his wife and son joining him occasionally in 19th Century costumes.

He is one of the better-informed reenactors and can field questions from bystanders at such events. His research has been cited by some foreign collectors of Spanish-American War artifacts.

For him, reenactment can help instill idealism, heroism, and other values even in the private sector. His electronics company employed this theme in its audiovisual presentation for employee service awards. “It’s a kind of edutainment through historical reenactment” that will “influence Filipinos to be heroes in their own special way, whatever career they choose in life,” Mr. Javier said.

Local reenactors have even linked up with their foreign counterparts here in Asia, as well as in the United States and Europe, some of whom can be very comprehensive in and known for their research.

Professor Jose noted that Philippine history is enriched by the unique stories of the country’s provinces. Provinces, cities, and municipalities looking to cash in on the potentials of tourism — long touted as a compelling growth sector for the country — may consider tapping reenactors to lend flavor to local tourism events, as is done in some historical centers of Japan. That, in turn, should help reenactors themselves hone their knowledge.

Hopefully, taking reenactment to the next level will add to quality historical TV series and indie films as effective tools for keeping our identity as a people intact and alive in an increasingly globalized environment.

 

Wilfredo G. Reyes was editor-in-chief of BusinessWorld from 2020 through 2023.

Mid-Autumn Festival offers

THE ASIAN Mid-Autumn Festival falls on Sept. 17, so there is still time to grab these mooncakes, a symbolic (and tasty) way of celebrating the holiday.

Kee Wah Bakery

Kee Wah Bakery created mooncakes that boast of the modern and authentic taste of Hong Kong’s rich heritage. The Kee Wah Supreme Mooncakes come in the bakery’s signature tin can decorated with a classic emperor’s portrait. The cakes are made with lotus seed paste, peanut oil and salted egg yolks. Flavors include White Lotus Seed Paste Mooncake with Two Yolks and Golden Lotus Seed Paste Mooncake at four pieces in a tin for P3,600. It also has mini variants, with each mooncake weighing around 60 gm. The Mini Golden Lotus Seed Paste Mooncake with Yolk and Mini White Lotus Seed Paste Mooncake with Yolk come in eight pieces per box for P2,800. Additional flavors include: Red Bean Paste Mooncake, Assorted Nuts Mooncake, and Red Bean Paste Mooncake with Two Egg Yolks (prices starting at P3,100 for four). Kee Wah is also releasing new flavors, such as Egg Custard and Dried Figs. For every P5,000 order of mooncakes, customers will receive freebies (a Mini Panda Cookie Tin or a Mini Shortcake Tin). Visit its stores at Robinsons Magnolia, S Maison, and The Podium. The products are also found on Lazada, Shopee, Pickaroo, Metromart, and GrabMart.

The Hilton Manila

The Hilton Manila at Newport World Resorts unveils its Lunar Legacy collection, handmade mooncakes crafted by chef Kevin Xu Qiao Yuan. The Lunar Legacy collection offers the Traditional Set for P3,088++, the Boutique Set for P2,888, the Snow Skin Set for P2,888++, the Shanghainese Set for P988++, and the Do-It-Yourself Set for P788++. Each mooncake set comes in ruby red packaging adorned with intricate gold trim and patterns, inspired by a traditional Chinese cabinet. Hilton Manila also offers a luxury hamper featuring a box of six of either Traditional, Boutique, or Snow Skin mooncakes paired with a bottle of Dalmore 12 Years whisky for P12,888++. The Lunar Legacy collection is available until Sept. 17 via 7239-7788 or www.hiltonmanila.com.

The Marriott Manila

The Marriott Manila at Newport World Resorts is celebrating the occasion with its own mooncake collection. Presented in gift boxes, the sweet and savory mooncakes come in three flavors: Red Lotus Paste with Yolk, White Lotus Paste with Yolk, and Wine Cranberry. Complement this mooncake experience with pralines available in Chocolate Galaxy and Marble Chocolate flavors. Add-ons include Candied Walnuts and Tie Guan Yin Tea. Available until Sept. 17, the mooncake package starts at P1,488 nett. Every purchase of Marriott Manila’s mooncakes supports a worthy cause with part of the proceeds going to the chosen beneficiary of Marriott Worldwide Business Councils-Philippines. Discounts apply for early bird and bulk orders. For inquiries, call 0917-624-5980 or 0917-584-9553.

MX Durian Mooncake

The MX Durian Mooncake Series, sought after by durian lovers, returns this year with three variants: the Snowy Musang King Durian Gift Box, the Snowy mini 4Musang King D-24 Durian, and the Musang King Durian Molten Mooncake. Every MX Durian Mooncake is filled with 100% Musang King Durian pulp from naturally ripened fruits from Malaysia. For a limited time only, buyers can collect exclusive free gifts for orders of P3,000; meanwhile, delivery is free delivery within Metro Manila for orders worth P6,000 and above. The Hong Kong MX mooncakes are available on Facebook (Hong Kong MX Products Philippines), Instagram and TikTok (@hkmxproductsph), its official website (www.doubledownimportexportinc.com), on Lazada and Shopee (Hong Kong MX Products Phils), through GrabFood, Pickaroo, and MetroMart (various locations of Hong Kong MX Bakery). There are also physical stores at SM Mall of Asia, V-Mall Greenhills, Uptown Mall, and Ayala Malls Cloverleaf.