Ombudsman suspends DENR exec for abandoned Canadian trash

June 29, 2018 | 7:38 pm

THE Office of the Ombudsman has suspended Department of Environment and Natural Resources (DENR) Undersecretary Juan Miguel Cuna in connection with the abandoned shipment of garbage imported from Canada to the Philippines in 2013, according to a statement released on Friday.
According to the Ombudsman, Mr. Cuna was, “found guilty of Simple Misconduct and ordered suspended without pay for three months,” with DENR Secretary Roy A. Cimatu directed to implement the suspension order.
The Ombudsman added Mr. Cuna faces violations of Republic Act (RA) No. 3019 or the Anti-Graft and Corrupt Practices Act for allegedly “mishandling” the shipment of trash.
It was discovered in its investigation that Canadian-based exporter Chronic Inc. shipped the container vans filled with plastic scrap materials “without securing import entries for its shipment that arrived in July 2013 and August 2013.” There were 50 containers in total that were not claimed by Chronic.
Upon closer look, Ombudsman investigators found that Mr. Cuna, then Director of the DENR’s Environmental Management Bureau (EMB), “issued a Registry Certificate for the Importation of Recyclable Materials Containing Hazardous Substances dated 19 June 2013 despite the lack of details in the Importer’s Registry Sheet.”
“Respondent Cuna acted with gross inexcusable negligence when he issued a Registry Certificate in favor of Chronic Plastics despite the insufficient details in its Importer Registry Sheet,” the Ombudsman said.
It explained, “[w]ithout the necessary information, the EMB cannot sufficiently make a determination that Chronic Plastics is capable of recycling materials to be imported. However, despite this, respondent Cuna still approved Chronic Plastic’s application of registration.”
Mr. Cuna also allegedly issued six Importation Clearances to Chronic Plastics “despite an existing Notice of Violation dated 05 September 2013 for importing heterogenous and assorted plastic materials in violation of DENR Administrative Order No. 1994-28.”
According to the Ombudsman, “it is the mission of the EMB to protect, restore and enhance environmental quality towards good public health, environmental integrity and economic viability. It is also mandated to strictly implement environmental laws and restrict or prohibit the importation, manufacture, processing, sale, distribution, use and disposal of chemical substances and mixtures that present unreasonable risk and/or injury to health or the public.”
Canadian Prime Minister Justin J.P. Trudeau has expressed willingness to resolve the issue with the Philippine government but has yet to order the trash to be returned. — Dane Angelo M. Enerio

Immigration bureau bolsters Mactan-Cebu team ahead of new terminal’s opening

June 29, 2018 | 7:37 pm

THE Bureau of Immigration (BI) has deployed a dozen more officers to the Mactan-Cebu International Airport (MCIA) ahead of the opening of its new passenger terminal on July 1.
BI Commissioner Jaime H. Morente in the statement pointed out the officers were assigned “to conduct immigration inspection for arriving and departing international travelers.”
MCIA’s new Terminal 2 is expected to increase the passenger capacity of the international airport to more than 12.5 million passengers a year.
“The BI fully supports the vigorous efforts of (President Rodrigo R. Duterte) to market the Philippines as a prime tourist destination, thus our commitment to render quality service to the traveling public in our international ports,” he said.
He added: “We shall be fielding more personnel to MCIA in the coming months as we continue to hire new immigration officers who will agument our manpower not only in Mactan but in other international ports as well.”
BI Acting Deputy Commissioner Marc Red Fariñas in the same statement pointed out Mr. Morente “had been heeding requests for additional personnel in view of the increasing volume of international flights and passengers at the said airport which began early this year.”
According to him, “we had only about 60 BI perssonel assigned as the MCIA in 2017 and that number has now ballooned to more than a hundred.”
There are now 112 immigration personnel in the airport, he said. — Dane Angelo M. Enerio

Mistaken suspect in Nueva Ecija priest’s slay released

June 29, 2018 | 7:36 pm

THE Cabanatuan City Regional Trial Court Branch 27 on Thursday ordered the withdrawal of the criminal case against a suspect in the killing of Nueva Ecija priest Richmond Nilo last June 10, saying he was mistakenly identified and arrested by authorities.
Presiding Judge Angelo C. Perez, in his order dated June 28 and released to media on Friday, ordered the Philippine National Police (PNP) of Cabanatuan City to release Adell Roll M. Matias, who was earlier suspected of killing Mr. Nilo.
Mr. Matias was arrested on June 15 for allegedly killing Mr. Nilo after being identified by witnesses.
According to an affidavit submitted by Mr. Matias to the court on Friday, state investigators discovered a certain Omar L. Mallari was actually behind the killing.
He clarified he would not file a complaint against the authorities who apprehended him.
Mr. Nilo was shot by two unidentified gunmen on his way to hear mass at a in church Zaragoza. He was the third priest to be killed in a similar manner in half a year.
Authorities have yet to pinpoint a motive for his death. — Dane Angelo M. Enerio

LTFRB accredits new TNC E-Pick Me Up

June 29, 2018 | 7:36 pm

THE Land Transportation Franchising and Regulatory Board (LTFRB) confirmed that it accredited a new transport network company (TNC) on Thursday.
Inter-Agency Council for Traffic (I-ACT) spokesperson Aileen Lourdes A. Lizada told reporters in a Viber message on Friday that the new TNC is E-Pick Me Up, Inc.
The office of LTFRB Chairman Martin B. Delgra III verified the information to BusinessWorld.
Earlier this month, Ms. Lizada said the LTFRB was considering stopping the accreditation of new TNCs following the approval of a new department order (DO) putting the LTFRB in charge of the transport denomination.
But on Friday, she told reporters that “The action document is being finalized.” She added that the said document will have to spell out the terms of the moratorium.
For his part, Mr. Delgra said there is “no decision on the matter” as yet. “Right now (there) are pending applications for accreditation,” he said.
The LTFRB said E-Pick Me Up will initially operate in Metro Manila only. Eventually, the company hopes to expand its operations to the greater Metro Manila area and nearby provinces.
In early June, the LTFRB Pre-Accreditation Committee recommended E-Pick Me Up for accreditation by the board.
There are now eight TNCs that have been approved by the LTFRB to operate in the country. Aside from E-Pick Me Up, the others are Grab, Hype, Hirna, Owto, Go Lag, Micab and U-Hop. — Denise A. Valdez

Del Monte suffers net loss thanks to plant closures

June 29, 2018 | 7:35 pm

DEL MONTE Pacific Limited (DMPL) swung to a net loss for the fiscal year ending April 2018, dragged by the closure of two plants in the United States.
The listed canned fruit manufacturer said its net loss reached $28.2 million in the 12 months ending April, against a net profit of $24.4 million the year before. The performance for the year was weighed down by one-off expenses amounting to $74 million after the company closed down two plants in the US.
The closure of the plants was part of the company’s efforts achieve operational efficiencies among its plants and reduce costs from the US subsidiary, Del Monte Foods, Inc.
DMPL also wrote off deferred tax assets following a change in US tax rates.
Excluding one-off items, DMPL said it would have booked a net income of $12 million, still a 50% drop from the year before.
Meanwhile, the group’s sales slowed down by 2.5% to $2.2 billion for the fiscal year, with lower sales in the US dampening growth in Asia.
The Philippine unit, Del Monte Philippines, Inc. (DMPI), recorded $540.5 million or P27.6 billion in revenues for the period. This represents a 6.7% uptick in peso terms. Local sales accounted for two-thirds of DMPI’s sales, while the remaining portion comes from exports under the S&W brand and private label.
For the fourth quarter alone, DMPL’s net income surged 324% to $12.3 million, from the $2.9 million reported the year before. The increase was achieved after the company’s purchase of DMFI’s loans at a discount in the secondary market. Without this, the firm would have recorded a loss of $2.1 million due to lower export sales and reduced prices.
Sales for the fourth quarter were also lower by 8.5% to $499 million, due to lower sales in the US alongside the lower, cyclical pineapple juice concentrate prices in international markets and decreased exports of processed pineapple.
“The Group has been shifting to more branded consumer beverage given the volatile nature of industrial and commodity PJC,” the company said.
As part of efforts to strengthen its balance sheet and reduce leverage, the company raised $300 million from two tranches of preferred shares in April and December 2017. The funds raised were used to repay debt.
The company also purchased $124.9 million out of the total $260 million in second lien loans of DMFI at a discount in the secondary market this week. The purchase of the loans will allow it to save $8-10 million in interest payments for fiscal year 2019, as it is the group’s highest interest-bearing loan with a current rate of 9.5% per annum.
Moving forward, DMPL said it expects to be profitable in the next fiscal year given the programs in place to improve its operational efficiencies.
“With the divestiture of Sager Creek and closure of plants in USA, this will lead to improvement in margins starting FY2019 as well as stronger cash flow through lower inventories. The Group continues to review its manufacturing and distribution footprint in the US to improve operational efficiency and further reduce costs,” the company said.
Shares in DMPL dropped 38 centavos or 4.75% to close at P7.62 each at the stock exchange on Friday. — Arra B. Francia

DoJ’s Guevarra assigns new head prosecutor

June 29, 2018 | 7:35 pm

SENIOR Deputy State Prosecutor Richard Anthony D. Fadullon has been assigned to fill in the shoes of former Acting Prosecutor General Jorge G. Catalan, following the latter’s voluntary exit from his post.
In his Department Order No. 384 released on Friday, Department of Justice Secretary Menardo I. Guevarra designated Mr. Fadullon as the new officer-in-charge of the DoJ’s National Prosecution Service (NPS) starting on Saturday “until a new Prosecutor General is appointed by the President.”
Mr. Guevarra told BusinessWorld on Thursday that Mr. Catalan voluntarily requested to be relieved from his post to focus on his responsibilities as Makati City Prosecutor. He was designated the Presecutor General on June 9 last year by Mr. Guevarra’s predecessor, Vitaliano N. Aguirre II.
Sought for comment, Mr. Fadullon told reporters, “[m]oving forward, there are a lot of concerns that we have to look into and address as far as the National Prosecution Service is concerned. Among them are the spate of killings of prosecutors that have remained unsolved.”
“In the meantime, we will focus all efforts towards professionalizing the NPS and increasing the efficiency of our (prosecutors). Hopefully this will renew the trust of the people in the NPS (and) the DoJ,” he added.
Mr. Catalan welcomed the appointment of his peer, telling BusinessWorld in a text message: “(Mr. Fadullon) deserves the post! Best choice sya as PG!”
Mr. Guevarra also said on Friday, “new key appointments at the DoJ will be announced in the next few days.” He declined to disclose more details when pressed further by reporters. — Dane Angelo M. Enerio

Indie power producer GBP shifts to sustainable energy

June 29, 2018 | 7:34 pm

REGIONAL independent power producer Global Business Power Corp. (GBP) is shifting to provide sustainable energy solutions in a move to adapt to the current landscape in the sector.
GBP President Jaime T. Azurin said in a statement on Friday that this is part of GBP’s goal of powering “the nation’s growth” while being more responsive to environmental protection.
“We are realigning our strategy with the evolving energy market as well as the growing need to protect and conserve our environment for future generations,” he said.
At a recent management convocation, Mr. Azurin highlighted the importance of ensuring affordable, reliable, and sustainable energy in reaching the United Nations Development Programme’s Sustainable Development Goals.
The annual convocation also served as a strategic planning session and performance assessment for the company’s executives.
“Generating power, however, creates pressures on the environment,” Mr. Azurin said, pointing to the need for GBP to have a balanced energy mix and to look into how the opportunities in renewable energy can fit in the company’s portfolio.
“We must optimize resources available to us whether they’re conventional or renewable,” he added.
Last month GBP launched its Institute for Energy in Iloilo to promote clean coal technology and energy efficiency. The institute is also intended to develop and train GBP’s employees.
GBP, an associate of Metro Pacific Investments Corp. (MPIC), currently operates 11 power generation facilities in Aklan, Cebu, Iloilo, and Mindoro.
Last year, the energy firm acquired a 50% stake in Alsons Thermal Energy Corp. (ATEC), an energy provider in Mindanao. ATEC holds Alsons Consolidated Resources Inc.’s base load coal-fired power plant assets.
MPIC is one of the three Philippines units of Hong Kong-based First Pacific Co., Ltd., the two other firms being Philex Mining Corp. and PLDT, Inc.
Hastings Holdings, Inc., a. unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it also controls. — Anna Gabriela A. Mogato

Liquidity growth picks up slightly

June 29, 2018 | 7:34 pm

By Melissa Luz T. Lopez, Senior Reporter
MONEY SUPPLY grew faster in May even as growth in bank lending eased, the Bangko Sentral ng Pilipinas (BSP) announced Friday.
More money circulated in the Philippine economy as supply rose by 14.3% from a year ago, a tad faster than the 14.2% logged in April to log the quickest pace in two months.
Domestic liquidity or M3, which stands as the broadest measure of money in an economy, amounted to P11 trillion as of end-May. Month on month, money supply went up by 1.3%.
Funds from local sources grew by 16.8% last month, picking up from the 16.4% clocked in April amid a sustained rise in bank lending, the central bank said in a statement.
Net claims on the central government also surged by 17.3%, faster than the 13.1% increase the previous month as the government borrowed more money.
Meanwhile, net foreign assets (NFA) expressed in the peso posted faster growth as at 5.4% versus the 4.2% previously.
“Foreign exchange inflows coming mainly from overseas Filipinos’ remittances and business process outsourcing receipts drove the growth in the BSP’s NFA position,” the central bank said.
Foreign assets held by banks also grew due to higher loans and investments in debt papers.
The BSP said overall money supply growth stands “consistent” with inflation and economic activity, as it supports key production sectors.
CREDIT GROWTH EASES
Meanwhile, lending growth slowed in May to 19.4% coming from April’s 19.9%, the central bank said.
Factoring in the reverse repurchase agreements availed by banks, lending eased to 17.7% coming from 19.9% a month ago.
Bulk of the loans went to fund productive sectors to account for 88.5% of the total. These credit lines grew by 19.3% in May — slower than 19.6% previously — led by a 31.3% surge for financial and insurance activities.
Other sectors which took bigger loan lines include wholesale and retail trade, repair of motor vehicles and motorcycles (23.4%); manufacturing (17.7%); real estate activities (15.7%); and electricity, gas, steam and airconditioning supply (11.6%).
In contrast, borrowings for administrative and support services as well as agriculture dropped by 49.2% and 8.3%, respectively.
Retail lending also softened as household credit grew by 18.4%, slower than the 19% climb the previous month. This came on the back of motor vehicle loans and salary-based borrowings, versus a bigger credit card debts.
The BSP raised interest rates by 25 basis points their May policy meeting, but its effect will not be immediately reflected in market rates.
The central bank keeps track of liquidity and bank lending dynamics to ensure price and financial stability, at a time when some economists are flagging the potential overheating of the Philippine economy due to rapid credit growth.

Velasquez takes over PT&T

June 29, 2018 | 7:33 pm

PHILIPPINE Telegraph and Telephone Corp. (PT&T) has formalized the election and appointment of James G. Velasquez as the company’s new president and chief executive officer, replacing Benjamin M. Bitanga.
In a disclosure to the stock exchange, PT&T said that its board of directors elected and appointed Mr. Velasquez in a special meeting held on Thursday. His new position will be effective starting July 2.
“Please be informed that in a special meeting of the Board of Directors held today, 28 June 2018, Mr. James G. Velasquez was elected and appointed as the President and Chief Executive Officer of Philippine Telegraph and Telephone Corporation (“PT&T”) effective 02 July 2018,” it said.
It noted that Mr. Velasquez was a member of the telcommunications company’s board of directors since March 1 this year. PT&T then said that Mr. Velasquez is set to replace Mr. Bitanga after the latter stepped down from his position.
Prior to his stint as a board member of PT&T, Mr. Velasquez was a senior executive for IBM Global Technology Services, Asia Pacific. He was also the president and country general manager of IBM Philippines for six years.
Mr. Velasquez has almost 30 years of experience in information technology (IT) business management. He was also the regional general manager for IBM ASEANA/SA.
Aside from his background with IBM, Mr. Velasquez was also a board member of the Management Association of the Philippines and online news corporation Rappler, Inc.
PT&T is one of the companies looking to become the country’s third major telco player. The company already has an agreement with the state-owned National Transmission Corp. (TransCo) for its “dark” fiber. — Denise A. Valdez

Gov’t outstanding debt down in May

June 29, 2018 | 7:33 pm

By Melissa Luz T. Lopez, Senior Reporter
OUTSTANDING DEBT went down in May as the government settled domestic loans, the Bureau of the Treasury reported on Friday.
National government debt totalled P6.833 trillion for the month, down 0.6% from the P6.875 trillion tallied as of end-April. However, the debt stock grew by 7.7% from the P6.345 trillion tallied in May 2017, data showed.
About two-thirds of the loans were sourced locally at P4.424 trillion, down 1.7% from the previous month but up 6.9% year-on-year. This came as the government settled P74.93 billion in redeemed government securities, which was partly offset by the weaker peso, which pushed debts up by P410 million.
The government has issued P4.423 trillion worth of debt papers as of May.
Meanwhile, loans from foreign sources rose by 1.4% to reach P2.408 trillion in May. The depreciation of the peso pushed the value of outstanding debts up by P37.66 billion, the Treasury said.
The peso depreciated in May to P52.554 versus the greenback, coming from the P51.734-per-dollar level in April according to exchange the rate used by the Treasury.
Outstanding external loans grew to P912.72 billion in May, to mark a 7.6% increase from a year ago.
Guaranteed obligations amounted to P492.3 billion in May, down from the previous month’s P494.445 billion as the state settled some of its domestic borrowings.
The government borrows from local and foreign sources to fund its budget deficit, which for this year is capped at 3% of the country’s gross domestic product.
BANK LOANS UP
Foreign currency loans granted by Philippine banks also grew as the year opened to outpace the increase in dollar deposits.
The Bangko Sentral ng Pilipinas said outstanding loans under banks’ foreign currency deposit units reached $16.359 billion, a tenth higher than the $15.374 billion recorded as of end-December and the $14.349 billion tallied in March 2017.
Only a fifth of the loans are due in less than a year worth $4.224 billion, while those with maturities of over a year reached $12.135 billion.
By source, $11.315 billion are owed to Philippine residents while $5.045 billion was borrowed from foreigners.
Bulk of the loans went to towing, tanker, trucking and forwarding (24.1%); merchandise and exporters (20.1%); public utility firms (11.4%); service producers/manufacturers, including oil companies (6.7%).
On the other hand, foreign currency deposits dropped to $38.398 billion from the $39.194 billion held by banks as of December. The loans-to-deposits ratio then increased to 42.6%, according to central bank data.
A bigger amount of foreign currency deposits stands as buffers versus external shocks and boosts the country’s dollar reserves.

Net liability position improves in Q1

June 29, 2018 | 7:33 pm

A DECLINE in liabilities, coupled with a rise in assets, caused the country’s international investment position (IIP) to improve as of March, the central bank said.
The country’s net liability position declined to $34.1 billion at end-March 2018 from $43.4 billion as of December 2017, improving by 21.3%, data released the the Bangko Sentral ng Pilipinas (BSP) on Friday showed.
The IIP takes stock of a country’s financial claims and liabilities. The quarter-on-quarter improvement logged in the first three months was on the back of a $8.1-billion or 3.8% contraction in total financial liabilities to $205.9 billion along with a slight increase in foreign assets to $171.7 billion from $170.6 billion previously.
External financial liabilities dropped because of negative revaluation adjustments in the country’s portfolio and direct investment accounts due to a decline in both the stock market and the peso — resulting in lower dollar equivalents of peso-denominated instruments. Foreign portfolio investments contracted by 7.9%, while foreign direct investments dropped 2% at end-March 2018.
About two-thirds or 65.3% of the total foreign liabilities were held by other sectors, totalling $134.5 billion at end-March. These mostly consisted of non-residents’ holdings of equity capital and debt instruments issued by local affiliates, equity securities issued by residents and loans extended by non-resident creditors.
Meanwhile, the general government’s outstanding foreign liabilities stood at $36.7 billion as of March, making up 17.8% of the total. These were comprised of debt securities held by non-residents and loans extended by non-resident creditors.
Banks’ total external liabilities amounted to $33.3 billion in the period or 16.2% of the tally.
Meanwhile, foreign assets went up 0.6% on the back of a 10.1% expansion in residents’ portfolio investments and direct investments (by 1.7%) abroad, which offset the 1.3% drop in reserve assets in the quarter.
Assets held by the BSP stood at $80.7 billion, with $80.5 billion as dollar reserves. Bank assets totalled $26.9 billion, while assets held by other sectors reached $64.2 billion.
By type of instrument, debt instruments to support intercompany lending between multinational firms and their local units accounted for 15.6% of the total liabilities, while placements in shares of stock of issued by local companies took a 12.8% share. Other assets were mostly in the form of debt
securities issued by non-residents (10.3%), residents’ deposits in banks abroad (7.7%), and loans extended to non-residents (5.4%).

Philippines, Papua New Guinea increase air entitlements

June 29, 2018 | 7:32 pm

THE PHILIPPINES and Papua New Guinea now have expanded air entitlements, having signed an agreement to improve air connectivity on Thursday.
A statement from the Department of Transportation (DoTr) said the country’s designated airlines may now fly 1,500 seats weekly between Manila and Port Moresby from the previous 600.
For other areas in the Philippines and Papua New Guinea, a total of 3,000 seats are allotted every week, up from just 1,500 previously.
It noted state leaders from the two countries made the deal in a bid to develop agro-industries in the area.
“This expansion in air connection comes hot on the heels of Papua New Guinea Prime Minister Peter O’Neill’s state visit in May, which resulted in the two nations committing to cooperate more closely in fishing and agriculture, particularly tuna processing and the development of rice and coconut farming,” DoTr added.
With guidance from the Civil Aeronautics Board (CAB), the two governments conducted the talks which led to the signing of the deal.
“The negotiations saw the Department of Transportation (DOTr), through the Civil Aeronautics Board (CAB), lead the Philippine Air Consultation Panel in the push for the expansion of entitlements for the designated carriers of both parties,” it said.
The DoTr also noted this year’s Asia Pacific Economic Cooperation meeting will be held in Papua New Guinea, which is scheduled for November. — Denise A. Valdez