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'Bag rage' as Australia supermarkets impose plastic ban

Dozens of supermarket staff have suffered abuse as two major Australian grocery chains struggled to impose a ban on single-use plastic bags, with one irate customer putting his hands around a shop assistant’s throat.
Woolworths and Coles last year announced plans to voluntarily remove free lightweight plastic bags from their stores nationally and instead offer more environmentally friendly reusable bags for 15 Aus cents (11 US cents) each.
The Coles ban came into force on Sunday. Woolworths’ took effect on June 20, but the company was forced to delay the move by 10 days after customers complained, with staff bearing the brunt of their anger.
A survey by the Shop, Distributive and Allied Employees’ Association — the union that represents shop assistants — showed that of the 141 members employed by the two chains to respond so far, 61 said they had been subjected to abusive behaviour.
It included a worker being assaulted by a customer after being told there were no free plastic bags at a store in Western Australia state.
“A male customer in the self-serve area swore loudly at a female worker,” the union’s assistant secretary Ben Harris told AFP on Monday. “She provided him with some complimentary bags and apologised.”
The customer then made a mistake by scanning an item twice, but when the same worker came to help him, “he walked up behind her and put his hands around her throat”, Harris said.
Other customers have thrown grocery items on the floor and stormed off after swearing at staff.
“While we understand that some customers may be frustrated by this change, there is absolutely no excuse for abusive or violent behaviour towards retail staff,” Gerard Dwyer, the union’s national secretary said in a statement.
He said the ban could also pose a health risk, with people bringing filthy used bags to pack their shopping without considering hygiene issues.
“In some cases, customers have attempted to use bags which contained vomit, dirty nappies or rat faeces. This is obviously unacceptable and presents a serious health risk to retail staff,” he said.
According to US journal Science, eight million tonnes of plastic are dumped into the Earth’s oceans and seas each year, with toxic particles ingested by fish and, through the food chain, by humans.
In response to mounting community calls for change, all states and territories in Australia now either have a plastic bag ban or are planning one, except New South Wales. Retailers face fines of up to Aus$6,000 if they do not comply. — AFP

War on plastic leaves manufacturers clutching at straws

For decades, plastic straws have been essential props for cocktail makers, smoothie lovers and fast food addicts.
But that may be starting to change, thanks largely to vigorous environmental campaigning.
Under pressure from activists, the European Union, Britain, India and even fast food giants like McDonald’s have all made some headway towards bringing the use of plastic straws to an end.
And with public pressure growing on governments, particularly in Europe, to ban single use plastics, manufacturers are feeling the heat.
According to peer-reviewed US journal Science magazine, eight million tonnes of plastic are dumped into the Earth’s oceans and seas each year — 250 kilogrammes (550 pounds) every second.
For years, the focus of environmentalists has been on plastic bags. But plastic straws have now come into the spotlight, thanks in part to images that have gone viral on the internet.
One online video about the danger posed by seemingly innocuous straws shows a sea turtle rescued off Costa Rica getting one removed from its nostril.
Baby steps
The British government in April said it planned to ban the sale of single-use plastics including straws.
The European Union followed suit in late May.
In India’s commercial capital Mumbai, Burger King, McDonald’s and Starbucks were fined for violating a ban on single use plastics, an official said earlier in June.
India’s Prime Minister Narendra Modi has pledged to make his country free of single use plastic by 2022.
Some corporations are also taking steps.
In the UK and Ireland, McDonald’s has pledged to complete a transition to paper straws by 2019.
In France, the burger giant is testing alternatives.
The Hilton hotel giant in May vowed to remove the offenders from its 650 properties by the end of 2018.
“Laid end to end, the straws saved each year in (Europe, the Middle East and Africa) would exceed the length of the River Seine,” the hotel chain said in a statement.
Pasta and bamboo sticks
There are alternatives to plastic straws, but they are much pricier.
The five-star Monte Carlo Palace hotel in Monaco has introduced biodegradable straws.
Others are using raw pasta and bamboo sticks.
The United States is resisting change while Europe takes the lead with biodegradable plastics made either from fossil fuels or crops such as potatoes and corn.
Some 100,000 tonnes of bioplastics were produced in 2016 in the world, according to Germany’s specialist Nova-Institute.
In 2017, biodegradable plastic production capacity rose to 800,000 tonnes globally, the European Bioplastics industrial group said.
And while this may appear to be a step in the right direction, manufacturers are concerned about the impact outright bans would have on their sales.
“It’s not a very good sign,” said Herve Millet, technical and regulatory affairs manager at PlasticsEurope, the region’s leading plastics manufacturers’ association.
“But … big corporations also have concerns over their image and they must at least try to find a way to respond to society’s expectations.”
No miracle cure
Europe’s top plastic straws manufacturer Soyez, which is based in France, is also uncertain about how to make the transition.
“The problem isn’t new and it’s serious, so we obviously need to find alternatives,” the company’s director Pierre Soyez said.
“We’ve been working on this for several months,” he said, adding that it was “really complicated” to try to make the shift overnight.
Experts, meanwhile, warn that biodegradable plastics may not be a miracle solution anyway.
“People think that biodegradable means nothing is dumped in nature. But that’s not the case at all,” engineer Virginie Le Ravalec of the French Environment and Energy Management Agency.
A separate collection system for bioplastic waste would need to be set up in order for the shift to really work, and that would involve millions in investment from states.
Activists fear, however, that biowaste may end up in the oceans — much like plastic has for decades.
“Over periods of days, weeks or even months, a bioplastic item could present just as much threat to marine life as a conventional plastic item,” Fiona Nicholls of Greenpeace warned.
As such, Nicholls says humanity’s only hope is to reduce our use of plastics.
“Swapping one plastic for another … is not a fix to the plastic pollution problem that our oceans and waterways face.” — Pierre Donadieu and Marie Heuclin, AFP

US teachers quietly train to carry guns into school

When Donald Trump proposed arming teachers to deter school shooters, the overwhelming response from educators was horror. Yet teachers in Colorado are taking action to carry concealed guns to school.
The non-profit group FASTER, set up after 20 small children were killed in 2012 at Sandy Hook Elementary School, has trained more than 1,300 US school staff, mostly in Ohio, on how to use a handgun in the event of a school shooting.
Sixty-three of them have been trained in Colorado, home to the 1999 Columbine High School shooting. The swing state has a Democratic governor and both a Democrat and a Republican in the US Senate.
“I think it’s scary to people to bring a weapon into school,” conceded Katie, a first-grade teacher in Jefferson County, west of state capital Denver, who declined to give her second name.
“They just see the bad side, not the positive side of how guns can save people,” the 27-year-old told AFP.
She was a student this week at the three-day, $1,000 course in Commerce City outside Denver.
The United States is the only developed country in the world that suffers relentless school shootings with roughly one a week, according to Everytown for Gun Safety, a group working to restrict firearms.
America’s gun violence epidemic kills around 33,000 people each year. More than 214,000 students have experienced a school shooting in the United States since 1999, according to a Washington Post database.
As shootings multiply and Congress remains paralyzed, FASTER saw an uptick in business, even before President Donald Trump supported arming teachers in the wake of a Valentine’s Day massacre in Florida.
“I had to add four additional classes to our schedule to meet demand this year, but I don’t think it was related to Trump,” Ohio director Joe Eaton said.
This week, 24 Colorado school staff, including principals, teachers and pastors, attended a three-day training led by four active duty law enforcement officers.
Rural areas
Colorado law prevents anyone from carrying weapons onto school grounds with the exception of school resource officers — law enforcement responsible for safety in schools — and security guards.
Many on the course are prohibited from being armed at school, but hope their training will help their districts change their minds.
The curriculum includes handgun basics, range shooting, casualty care tactics and roleplaying with an active shooter and simulated fire.
“I will definitely talk to my principal and security,” said high school physics teacher John MacFarlane, 40, seeing weaknesses in his district’s security protocol after the exercise.
Wayne, a facilities manager at a rural primary and high school, said his district estimates it would take 20 to 25 minutes for law enforcement to respond to an incident at the school, which has no SRO.
It took just 7.5 minutes for two teenage boys to kill their Columbine classmates in the library, where survivor Evan Todd told the class he was hiding. Twelve students and a teacher died in the 1999 shooting in Littleton, Colorado.
Todd, 35, said he “absolutely” believes there would have been fewer deaths if teachers had been allowed to carry a gun.
But there are plenty of critics.
“I do understand how it can be a tougher issue in our very rural areas,” said Tom Mauser, spokesman for Colorado Ceasefire, a political action committee that advocates for stricter gun laws.
“Teachers should be teachers, not SWAT members.”
Mauser’s 15-year-old son, Daniel Mauser, died at Columbine.
‘Ominous thing’
By the end of the course, 21 of the 24 participants met the Colorado Peace Officer Standards and Training requirements in handgun proficiency, the same level for police officers who graduate from the academy.
Staff who receive POST qualification could be considered by their school districts to be security guards in order to legally carry concealed guns on school premises.
FASTER encourages schools to announce that they have armed staff as a deterrent for would-be shooters.
Students themselves are divided.
“I think it would be a very smart thing so you don’t have to wait and fear for your life,” said Alex Easton, 14, from Aurora, Colorado.
Andre Fouque, 16, from Louisville, Colorado, was more skeptical.
“Would police be able to differentiate who had the gun? The teacher would be the first person to get shot. We should leave that to the police,” he said.
FASTER is trying to schedule classes in Indiana and Wyoming, and see if there is enough demand to hold classes in New York state next year.
“The more people talking about it, taking classes and carrying and getting approval from districts, the more it won’t be a scary, ominous thing,” said Katie, the first-grade teacher.
— Monique Antonette Lewis, AFP

Japan business confidence slips in June survey: BoJ

Confidence among Japan’s biggest manufacturers has slipped for the second straight quarter, a key central bank survey showed on Monday.
The Bank of Japan’s Tankan report — a quarterly survey of about 10,000 companies — showed a reading of 21 among major manufacturers in its June survey against 24 in the March report.
The latest Tankan, however, hardly made economists pessimistic about the world’s third largest economy, with the headline index still close to its highest level in over a decade.
The Tankan report, the broadest indicator of how Japan Inc is faring, marks the difference between the percentage of firms that are upbeat and those that see conditions as unfavourable.
The latest reading is slightly lower than market expectations of 22, according to data compiled by Bloomberg News.
“The second straight quarterly decline is certainly not good, but the level of (business confidence) is still high,” Yoshiki Shinke, chief economist at Dai-ichi Life Research Institute, told AFP.
“We are not facing a recession phase, but the pace of economic expansion is slowing down,” he said.
The survey came after solid job market-linked data released on Friday, including Japan’s jobless rate in May that slumped to a 26-year low.
Confidence fell among motor vehicle makers and electronics makers as the average predicted yen rate for the business year from April appreciated to 107.26 yen to the dollar in the latest survey from 109.66 yen predicted in March.
A strong yen is negative for Japanese exporters as it makes their products less competitive abroad and erodes profits when repatriated.
“Decline in the auto sector — even though their sales are strong — reflects geopolitical risks” including US President Donald Trump’s threat of tariffs, Shinke said.
And yet, concerns over protectionist policies “so far have not affected plans of capital investment nor demand-supply conditions,” he added.
The sentiment among iron and steelmakers, and among nonferrous metals makers also slipped, amid lingering worries over the US move to impose hefty tariffs on steel and aluminium.
The index for non-manufacturers edged up to 24 from 23, the first rise in the past four quarters, or since a year ago.
But confidence among retailers dropped to 0 from 11, which Shinke said “is a slight concern”.
“Consumption is not that bad but is not strong enough to lead the economic expansion,” he said.
Japan’s economy slid into negative territory for the first time in two years at the beginning of the year, technically ending its longest period of expansion since the ‘bubble’ days of the 1980s.
But the contraction by 0.2 percent quarter-on-quarter in the January-March period does not suggest a recession, economists say.
Economists argue Japan is on a solid recovery path on the back of a global economic recovery, with investments linked to the Tokyo 2020 Olympics also giving the economy a shot in the arm. — AFP

Tokyo stocks open lower as global trade worries weigh

Tokyo stocks opened lower on Monday amid worries about global trade as a key business sentiment survey showed confidence among Japan’s biggest manufacturers has slipped.
The benchmark Nikkei 225 index dropped 0.21 percent or 47.85 points to 22,256.66 in early trade while the broader Topix index was down 0.23 percent or 4.00 points to 1,726.89.
“Caution remains strong over the Trump administration’s trade policy towards China,” said Makoto Sengoku, market analyst at Tokai Tokyo Research Institute.
“It is hard to predict exactly how the real economy as well as market sentiment would be affected” with the US administration poised to roll out tariffs on some $34 billion of Chinese imports on Friday, he told AFP.
A quarterly survey from the Bank of Japan showed confidence among major manufacturers slipping for the second straight quarter, but Sengoku said its negative impact on markets was small compared with the broader concerns over global trade.
The headline reading in the June report came in at a slightly worse-than-expected 21, down from 24 in March.
“The reading was not a positive factor but didn’t fall so deeply, despite the tough conditions in the April-June period ranging from the US-China trade spat to concerns over Europe” after the political shake-up in Italy, Sengoku said.
The yen has not strengthened enough to dampen Japanese exports, underpinning exporters’ sentiment, he added.
The dollar was trading at 110.77 yen against 110.61 yen in New York on Friday.
Nissan lost 1.11 percent to 1,066 yen while Toyota rose 0.20 percent to 7,185 yen.
Nintendo gained 0.27 percent to 36,300 yen and Sony rose 1.12 percent to 5,728 yen.
— AFP

Sheinbaum, first woman elected Mexico City mayor

Claudia Sheinbaum, a Jewish scientist, environmentalist and left-wing politician, became the first woman ever to be elected Mexico City mayor on Sunday, according to exit polls.
Sheinbaum, 56, has made a rapid political rise to lead North America’s largest city — though it has not been without controversy.
She won the election to lead the capital with between 47.5 and 55.5 percent of the vote, according to the polling firm Mitofsky.
She will not be the first woman to govern Mexico City — Rosario Robles held the job on an interim basis from 1999 to 2000, after her boss, Cuauhtemoc Cardenas, resigned to run for president.
But it is a historic electoral win in a country with deep-rooted problems of gender inequality and violence against women.
Sheinbaum surged into office on the coattails of the anti-establishment leftist who looks likely to win the presidential race, Andres Manuel Lopez Obrador.
She was among the first politicians to leave Mexico’s established left-wing party, the Party of the Democratic Revolution (PRD), and join Lopez Obrador’s breakaway, Morena, when he formally launched it in 2014.
The following year, she won election as district mayor of Mexico City’s Tlalpan neighborhood, Lopez Obrador’s own district and one of the 16 “delegations” that make up the sprawling capital of more than nine million people.
That was the launch pad for her mayoral campaign — but she has been embroiled in controversy along the way.
Tlalpan was one of the areas hardest hit when a 7.1-magnitude earthquake devastated central Mexico on September 19, 2017.
Sheinbaum’s district became the center of world attention when the Rebsamen elementary school collapsed in the quake, killing 19 children and seven adults inside.
It later emerged the district had granted dodgy construction permits to the private school’s owner — who is today on the run from the law — allowing her to build an apartment for herself on top of the building, which destabilized the structure.
A group of victims’ families has brought criminal charges over the case, and wants Sheinbaum to face investigation.
She vehemently denies responsibility, and accuses her opponents of exploiting the tragedy for political reasons.
But she has been the target of unrelenting anger from victims’ families and their sympathizers — including on election day.
“Murderer!” a protester shouted at her after she cast her ballot.
Activist origins
Born into a family of scientists, Sheinbaum studied physics at the National Autonomous University of Mexico, earning a doctorate in energy engineering and going on to work as a consultant for the United Nations.
She was active in the university’s student movement, which rose up against an unpopular series of reforms at the institution in 1986.
She was one of many veterans of the movement to go into politics and help launch the PRD in 1989 — the main opposition party in what was then a one-party state.
She married fellow student activist Carlos Imaz in 1987.
Imaz was among the most recognizable faces of the Mexican left, also governing the Tlalpan district, until in 2004, he was one of several top officials caught on camera accepting large sums of cash.
He avoided jail time, but resigned and faded from politics. The couple separated in 2016. They have a daughter.
When Lopez Obrador was elected Mexico City mayor in 2000, he named Sheinbaum his environment minister.
She followed the fiery leader when he split with the PRD to found Morena, and is seen as a close ally, winning the party’s mayoral nomination in August over the man who was considered the favorite, veteran politician Ricardo Monreal. — Sofia Miselem, AFP

EU 'possibly as bad as China' on trade: Trump

Europe is “possibly as bad as China” on trade, US President Donald Trump said in an interview broadcast Sunday, with trade wars emerging against both the Asian giant as well as longtime allies in Europe and Canada.
“The European Union is possibly as bad as China, only smaller,” Trump said on Fox News’ “Sunday Morning Futures” program.
“They send a Mercedes in, we can’t send our cars in. Look what they do to our farmers. They don’t want our farm products. Now in all fairness they have their farmers… But we don’t protect ours and they protect theirs,” he said.
Trump had already threatened tariffs on cars imported from the European Union, in response to the EU’s retaliatory tariffs last week on iconic US products including bourbon, jeans and motorcycles.
The EU retaliation came after Trump’s administration on June 1 struck Europe as well as allies in Canada, Mexico and elsewhere with tariffs on aluminum and steel.
Canada’s retaliatory tariffs take effect Sunday against American products including Florida orange juice, ketchup and Kentucky bourbon.
Canada and the US are among the world’s largest trading partners, with an estimated $673.9 billion in goods and services exchanged in 2017, with the US scoring a small surplus ($8.4 billion), according to US government data.
At Trump’s insistence, Canada, Mexico and the US are renegotiating the North American Free Trade Agreement.
“NAFTA, I could sign it tomorrow but I’m not happy with it. I want to make it more fair, OK?” Trump said, adding that he wants to wait until “after the election.”
Trump’s Republicans are fighting to retain control of Congress in November midterm elections.
In the interview the president again complained about Canada’s protected dairy industry, saying “that’s not fair.”
Against China, the world’s second-largest economy, the White House in mid-June announced stiff 25 percent tariffs on Chinese imports, sparking immediate retaliation from Beijing.
Trump on Wednesday said he supported tougher restrictions on foreign investment in sensitive technology, as well as export controls on those goods, but he stopped short of imposing specific restrictions on China.
Asked about that decision, Trump said in the interview that he is not backing down on China tariffs.
“No, no, no, no,” he said, noting that more tariffs could be imposed if there is no deal with China.
“I will tell you, China wants to make a deal and so do I, but it’s got to be a fair deal for this country,” he said.
The US has complained about Chinese policies that Washington said either forced companies to relinquish key technology or allowed China to steal it outright.
The president announced 25 percent import tariffs on hundreds of Chinese products to pressure the country to alter its practices. Those tariffs are due to take effect July 6.
That came on top of the tariffs on Chinese steel and aluminum that went into effect in late March — measures that prompted Beijing to slap punitive duties on 128 US goods, including pork, wine and certain pipes. — AFP

Analysts’ June inflation rate estimates

INFLATION likely clocked in faster in June on the back of rising food and oil prices coupled with a weaker peso, economists said in a BusinessWorld poll, with some noting that another rate hike may still be on the table for the central bank to temper prices. Read the full story.

Food, oil to stoke June inflation

The Philippine Statistics Authority (PSA) will report official inflation data on Thursday. Latest forecasts show that prices have definitely picked up faster than the 2.5% pace clocked in June 2017. — BW FILE PHOTO

By Melissa Luz T. Lopez, Senior Reporter
INFLATION likely clocked in faster in June on the back of rising food and oil prices coupled with a weaker peso, economists said in a BusinessWorld poll, with some noting that another rate hike may still be on the table for the central bank to temper prices.
A poll among 12 economists yielded a median inflation forecast of 4.7% for the month, which if realized will pick up from May’s 4.6% climb to a fresh high in at least five years. This also falls in the middle of the 4.3-5.1% estimate range given by the Bangko Sentral ng Pilipinas (BSP) Department of Economic Research last Friday.
The Philippine Statistics Authority (PSA) will report official inflation data on Thursday. Latest forecasts show that prices have definitely picked up faster than the 2.5% pace clocked in June 2017.

Michael L. Ricafort, economist at the Rizal Commercial Banking Corp. said the major inflation drivers last month were elevated world crude oil rates, a weaker peso-dollar exchange rate, as well as higher prices of sugar and rice in the local market.
Food inflation reached 5.5% in May, with a faster pace tallied in the provinces at 5.6% versus the 4.5% year-on-year increase in Metro Manila, according to PSA data.
The analysts pointed out that inflation may be approaching its peak, in line with the BSP’s forecast that prices will see its fastest climb within the third quarter. However, second-round effects of the tax reform law by way of higher transport fares and wage hike petitions are seen to drive costs up within the second half of 2018.
“Prices of basic commodities, especially oil, haven’t tapered yet. Also with the depreciation of the peso, imports are getting more expensive,” added Mitzie Irene P. Conchada, associate dean at the De La Salle University School of Economics.
The peso has been trading at the P53 level versus the dollar since June 11 to mark a sustained depreciation at a fresh 12-year low. An economic bulletin from the Finance department showed that the peso has depreciated by 7.42% against the greenback year-to-date, the second-worst performer in the region next to the Indian rupee’s 7.46%.
MORE RATE HIKES SEEN
A handful of market observers believe that the sustained peso weakness will prompt further interest rate hikes from the BSP despite the back-to-back increases announced in May and June.
“If the peso continues to depreciate significantly in early August, we may see the BSP hiking again on their Aug. 7 meeting. That seems to be a major consideration in their policy decisions lately,” said Emilio S. Neri, Jr., lead economist at the Bank of the Philippine Islands.
Rising inflation expectations could also prompt the BSP to raise benchmark rates anew, according to Security Bank Corp. economist Angelo B. Taningco.
Others, however, said the central bank may be done with its tightening moves for now.
“Moving forward, if global oil prices continue to be well-behaved from hereon, inflation might even come down to below the 4% levels towards yearend and in this regard, we don’t expect any more BSP rate hikes for 2018,” said Ildemarc C. Bautista, vice-president and head of research at the Metropolitan Bank & Trust Co.
The BSP expects full-year inflation at 4.5%, well beyond its 2-4% target.

Economic managers to review targets, assumptions for 2019 budget today

THE 2019 budget will be the first spending plan to have a cash-based appropriations scheme, which means agencies’ allocations are only valid within the fiscal year — as opposed to the obligation-based budget that allowed them to disburse funds for over two years.

By Elijah Joseph C. Tubayan, Reporter
THE DEVELOPMENT Budget Coordination Committee (DBCC) will convene today to review key economic assumptions for the 2019 budget targeted to be submitted to Congress on the day of President Rodrigo R. Duterte’s third State of the Nation Address (SONA) this month.
Finance Secretary Carlos G. Dominguez III said in a mobile phone message on Sunday that the “main item on the agenda is the 2019 budget in all its aspects.”
An advisory from the Department of Budget and Management (DBM) said the 173rd DBCC meeting will be held at the DBM headquarters in Manila.
Socioeconomic Planning Secretary Ernesto M. Pernia in a separate message said that the DBCC will “fine tune/finalize economic and financial assumptions for the 2019 budget.”
Budget Secretary Benjamin E. Diokno has said the Budget department will submit the proposed 2019 national budget to Congress on the day of Mr. Duterte’s SONA scheduled on July 23, which marks Congress’ third regular session.
The 2019 budget will be the first spending plan to have a cash-based appropriations scheme, which means agencies’ allocations are only valid within the fiscal year — as opposed to the obligation-based budget that allowed them to disburse funds for over two years.
According to Budget Undersecretary Laura B. Pascua, this means the upcoming budget may be slightly lower from this year’s plan as funds will be given only to those projects ready for implementation — a scheme seen to be “more accountable and transparent.”
“The 2019 budget will be slightly smaller than the 2018 obligation based budget because we are changing the basis of budgeting. Budgeting only for the goods and services which will be delivered and paid for in 2019,” Ms. Pascua explained in a separate text message on Sunday. “Hence, we had to be realistic in what agencies were utilizing of their past budgets, and take out those activities which we believed would be ready for 2020 implementation, not 2019.”
“There were a lot of these prior years contracts which were accumulated over the years.
“So now, agency performance would be measured in terms of disbursements for goods and services delivered and paid and, not merely obligated,” said Ms. Pascua. “What you see is what you really will get.”
In its April meeting, the DBCC set the cash-based 2019 budget at P3.469 trillion, about two percent higher than the P3.401-trillion earlier expected and 7.91% less than this year’s P3.767-trillion budget.
It also adjusted the projected revenues and disbursements in its medium-term fiscal program, taking into account the expected take from Package 1B of the government’s tax reform containing the general tax amnesty, estate tax amnesty, the easing of bank secrecy restrictions, and the Motor Vehicle Users Charge increases, even as it remains pending in legislation.
It also retained the deficit ceiling at 3% of gross domestic product (GDP).
Revenues projected for 2019 stand at P3.203 trillion, equivalent to 16.7% of GDP and 12.4% greater than the P2.846-trillion revenues programmed this year.
Meanwhile, programmed disbursements for next year are currently at P3.782 trillion, equivalent to 19.7% of GDP and 12.2% more than the P3.37-trillion set this year.
The DBM in National Budget Memorandum No. 130 cited “funding pressures,” in the 2019 budget, which includes the P12 billion Tax Reform Cash Transfer Project as the P200 monthly transfers to beneficiaries will be raised to P300; the P33.9 billion payments for military pension following the lifting of pension indexation next year; and the P60.1 billion transfer of Coco Levy funds to farmers upon ratification of the Coconut Farmers and Industry Development Act.
At its last meeting, the DBCC also raised its Dubai crude oil assumptions to $55-70 per barrel in 2018 from $50-65 per barrel previously while retaining the $50-65 per barrel target for 2019-2022.
It also raised the dollar-peso exchange rate assumption for this year until 2022 to P50-53 from P49-52 per dollar previously.
The DBCC likewise set merchandise exports growth to 9% this year and 8% starting 2019 to 2022. Import growth, meanwhile, is seen at 10% this year and 9% for the succeeding years until 2022.
For the borrowing program, the portfolio was revised to a 65-35 ratio in favor of local sources for 2018 from the previous 74-26 mix earlier programmed and 80-20 in 2017. For 2019-2022, the borrowing mix is set at a 75-25 ratio.

Tech firm files for P6.8-B IPO

THE local unit of Taiwan-based technology conglomerate New Kinpo Group (NKG) seeks to raise P6.77 billion through an initial public offering (IPO) within the year, as it aims to expand production capacity in the country. — WWW.NEWKINPOGROUP.COM

By Arra B. Francia, Reporter
THE LOCAL UNIT of Taiwan-based technology conglomerate New Kinpo Group (NKG) seeks to raise P6.77 billion through an initial public offering (IPO) within the year, as it aims to expand production capacity in the country.
In an e-mail to reporters late Friday, the Securities and Exchange Commission said Cal-Comp Technology (Philippines), Inc. filed a registration statement regarding its plan to sell up to 378.07 million shares with an over-allotment option of up to 19.9 million shares at a maximum price of P17 each.
The offer comprises around 26.77% of the consumer technology firm’s total issued shares.
Cal-Comp Tech is part of NKG, which offers global electronic manufacturing services and original design manufacturing services to its customers.
The company’s products and services include storage, printers, network-attached storage (NAS), wireless and broadband, digital home, consumer electronics, wearables, 3D printing, robotics, and emerging technologies, among others.
Aside from Cal-Comp Tech, other companies under NKG include Cal-Com Precision (Philippines), Inc. and AcBel Polytech (Philippines), Inc. The latter produces injection molded plastic precision parts and power supplies products for global clients.
Cal-Comp Tech opened its first factory in Batangas in 2015, which spans 140,000 square meters and houses three facilities. It now employs more than 6,000 employees at the Lima Technology Center in Lipa City, and at the First Philippine Industrial Park in Sto. Tomas, Batangas.
The firm looks to use the proceeds of the offer to build new manufacturing facilities in the country, as it plans to introduce new products to the domestic market.
NKG Chief Executive Officer and Cal-Comp Tech President Simon Shen said the planned share sale will help the company expand its foothold in the country, since it has become one of the group’s key manufacturing hubs in Southeast Asia.
The Batangas factory is the company’s 19th manufacturing hub in Southeast Asia.
“We believe our expansion will enable Filipinos to become more competitive in export manufacturing and tech R&D (research and development). It’s also an opportune time for the Philippines to be exposed to tech products that will truly bring homes and industries to the future,” Mr. Shen was quoted as saying in a statement.
The company looks to conduct the IPO before year-end, but did not give a specific date. BDO Capital & Investment Corp. is the offer’s issue manager and sole book runner.
Cal-Comp Tech’s planned IPO comes at a time when the market continues to show volatility, having dropped from its record high of 9,078 last Jan. 29 to a low of 6,929 last week. The index is currently in the so-called bear market territory, indicating that it has dropped by at least 20% from a recent high.
Last week saw the conduct of the first IPO of the year, where property developer and construction firm D.M. Wenceslao & Associates, Inc. raised P8.15 billion. The stock lost 14.5% to P10.26 at the end of its first trading session last week, as the overall negative sentiment weighed on its performance.
Canned fruit manufacturer Del Monte Philippines, Inc., which was scheduled to raise P17.55 billion through an IPO before DMW, deferred its plans due to bearish market conditions.
Asked whether it is a good idea to conduct an IPO given the currently volatility, BDO Capital President Eduardo V. Francisco said Cal-Comp Tech would have to be prepared for the market’s movements.
“We just have to be ready as the markets can improve anytime,” Mr. Francisco said in a text message.
Meanwhile, Timson Securities, Inc. Trader Jervin S. De Celis said the performance of the IPO will depend on the timing.
“But I think the funds that they’re raising is smaller than the previous IPOs that we’ve seen and sometimes market players take that into consideration. If the company’s market cap is small, it might interest the short-term players. We’ll have to see its fundamentals first and assess whether the demand will be strong or not,” Mr. de Celis said in a separate message.

New breed of Fil-Chinese businessmen sail out of the capital


By Marifi S. Jara, Mindanao Bureau Chief
YOUNG FILIPINO-Chinese entrepreneurs and professionals are exploring growing opportunities outside the Philippine capital, prodded by the administration’s infrastructure and inclusive development agenda, and their curiosity piqued by the recent rise of political and business leaders from Mindanao.
Signalling its venture out of Metro Manila, the 27-year-old Anvil Business Club, Inc., also referred to as the Association of Young Filipino-Chinese Entrepreneurs, held its officers’ induction in Davao City on June 30, the first time ever that it was held outside Malacañang.
“We’re here to look at tourism opportunities, trading opportunities, there’s a lot of construction that’s happening here, some networking for us… franchising,” Anvil Business Club President John Patrick S. Cua said in an interview with BusinessWorld on June 29 in Davao City.
Anvil Chairman Wilson Y. Lee Flores, in the same interview, said, “We are excited by the inspiring Davao success story we’ve been hearing about and the many economic opportunities of once-neglected Mindanao region… Apart from President (Rodrigo R.) Duterte’s correct vision to decentralize wealth and economic development… we also admire the strong leadership of Mayor Sara Duterte-Carpio and her no-nonsense attitude.”
Mr. Cua, who is managing director of Nielsen Philippines, said the out-of-the-capital direction is backed by economic indicators and various studies.
“I can quote a Nielsen study, ‘The Age of ASEAN Cities,’ the study says if you want to grow your business, or see the growth in consumption, it’s not going to happen in Metro Manila… the growth from now to 2025 is in the secondary and third-tier cities,” he said.
In succeeding years, he added, the group with 450 members intends to bring the same event to other cities in Mindanao as well as the Visayas.
Majority of the members, with ages ranging from 21-50, are from Metro Manila, but many do have roots in the different provinces where their Chinese ancestors landed as early as pre-colonial Philippines and started from scratch.
Mr. Cua himself was born and raised in Davao City before moving out for university and eventually a career in the corporate sector.
“I’m the first president of Anvil from Mindanao… I call Davao my hometown, I benefitted from the peace and order of our then mayor and now President Duterte,” he said.
Now with the administration’s aggressive infrastructure spending for the Build, Build, Build program, Mr. Flores said “this is a golden opportunity for us entrepreneurs to venture into provinces and grow with the expanding economy.”
The group’s three-day visit included trips to the Malagos Farm in an upland part of the city, and the Paradise Island Resort in neighboring Island Garden City of Samal. Some, in smaller parties, ventured to Tagum City in Davao del Norte, which will host this year’s Mindanao Business Conference.
“Something that’s quite underdeveloped is products for tourism… If we travel elsewhere, there are a lot of these places that offer an experience… those are some ideas to inspire our members,” Mr. Cua said.
Mr. Flores said the group also recently had “extensive dialogues with two tycoons with flourishing Mindanao businesses,” referring to Anvil honorary member Dennis A. Uy of the Udenna group of companies, and William Tiu Lim of Mega Fishing Corp. in Zamboanga City, producer of the Mega canned sardines brand.
“Metro Manila is so competitive, congested, but it’s like the comfort zone. It’s time to go outside,” Mr. Flores said.
At the same time, the Anvil chairman noted the need for improving business procedures alongside the rollout of infrastructure.
“Investors, big or small, hope to see better ease of doing business throughout Mindanao… I think Mindanao truly needs to modernize infrastructure with more and bigger airports, new trains, better seaports, efficient telecommunications… In some parts of Mindanao, there is a need to uphold better peace and order, such as Sulu and Maguindanao where government hopefully can resolve problems of insurgency,” Mr. Flores said.
Ms. Carpio, the presidential daughter who took over the helm of Davao, cited local government initiatives to attract more investments and welcomed the group’s enthusiasm, noting the role of the business sector in development.
“Progress in any community cannot be achieved solely by the efforts of the government, we recognize the role of the private sector as an essential factor in the advancement of any society,” she said during the induction ceremony where she was guest of honor.
“I hope you find promise in Davao today, just as your forebears before you did,” said the mayor of Davao, which has the biggest Chinatown in the country with four archways marking a 44-hectare area in the central district.
While a good number of their members are already conducting business with various industries in Mindanao, Mr. Cua said: “We are encouraging (them) to go outside Metro Manila and look for growth outside.”

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