Lawmakers urge Trump to consider new curbs on Nvidia chips used by China’s DeepSeek

January 31, 2025 | 11:33 am

WASHINGTON – Two members of U.S. Congress are calling on President Donald Trump’s administration to consider restricting the export of artificial intelligence chips made by Nvidia, alleging Chinese AI firm DeepSeek has relied on them.

Republican John Moolenaar and Democrat Raja Krishnamoorthi, who lead the House of Representatives Select Committee on China, asked for the move as part of a Commerce and State Department-led review ordered by Trump to scrutinize the U.S. export control system in light of “developments involving strategic adversaries.”

“We ask that as part of this review, you consider the potential national security benefits of placing an export control on Nvidia’s H20 and chips of similar sophistication,” they wrote in a letter dated Wednesday and addressed to National Security Advisor Michael Waltz.

In the letter, released on Thursday, they alleged that a sophisticated AI model recently released by DeepSeek made “extensive use” of Nvidia’s H20 chip, which is currently outside the scope of U.S. export controls.

The letter is a sign of growing concern in Washington about China’s rapid advances in AI after DeepSeek said its free AI assistant launched last week uses less data at a fraction of the cost of incumbent players’ models, possibly marking a turning point in the level of investment needed for AI.

In a separate notice reported by Axios on Thursday, the U.S. House of Representatives’ Chief Administrative Officer notified congressional offices not to use DeepSeek.

“At this time, DeepSeek is under review by the CAO and is currently unauthorized for official House use,” the notice is quoted as saying.

The U.S. fears China could harness AI to launch aggressive cyber attacks or even develop a bioweapon, prompting former President Joe Biden to spearhead a series of measures aimed at cracking down on China’s access to AI chips and the tools that make them.

DeepSeek and the White House did not immediately respond to requests for comment.

Nvidia said in a statement that its products “comply with all requirements set by the government” and that the company “is ready to work with the Administration as it pursues its own approach to AI.”

Reuters reported on Wednesday that the administration of Trump, who took office on Jan. 20, is mulling new curbs on H20 chips, which can be used to run AI software and were designed to comply with existing U.S. curbs on shipments to China. – Reuters

New Zealand targets cutting emissions by 51% to 55% by 2035

January 31, 2025 | 11:31 am

New Zealand flag — STOCK PHOTO | Image by Kerin Gedge from Unsplash

WELLINGTON – New Zealand said late on Thursday that it would make a commitment that by 2035 the country would have reduced emissions by 51% to 55% compared to 2005 levels.

The commitment is part of the country’s commitment under the Paris Agreement. Its initial commitment had been to reduce emissions by 50% by 2030 and is part of the country’s pledge to be net zero by 2050.

“We have worked hard to set a target that is both ambitious and achievable, reinforcing our commitment to the Paris Agreement and global climate action,” Climate Change Minister Simon Watts said in a statement.

“Meeting this target will mean we are doing our fair share towards reducing the impact of climate change,” he added.

Mr. Watts said New Zealand was on target to meet its commitments as early as 2044.

However, Climate Commission, a government-funded but independent expert, in December called for New Zealand to target reducing emissions further than its original effort as many comparable countries have more ambitious targets than New Zealand and evidence shows that global action is insufficient to limit global warming to 1.5 degrees Celsius. – Reuters

US judge blocks Trump administration from transferring transgender inmate

January 31, 2025 | 11:28 am

BOSTON – A U.S. judge has temporarily blocked federal prison officials from transferring a transgender woman to a men’s facility and denying her access to gender-affirming care in accordance with an executive order issued by President Donald Trump, her lawyers said on Thursday.

The temporary restraining order was issued by U.S. District Judge George O’Toole in Boston on Sunday while the inmate’s case was sealed in what appeared to be the first lawsuit challenging an order Trump signed on Jan. 20, his first day back in office, targeting what he called “gender ideology extremism.”

Mr. Trump’s order directed the federal government to only recognize two, biologically distinct sexes, male and female; house transgender women in men’s prisons; and cease funding for any gender-affirming medical care for inmates.

The lawsuit was filed on Sunday by the inmate, known by the pseudonym Maria Moe, and was soon after sealed. O’Toole, an appointee of Democratic President Bill Clinton, lifted the seal on Thursday as a hearing was underway on whether he should grant her further relief.

Her case was filed by lawyers at two LGBTQ rights groups including GLBTQ Legal Advocates & Defenders, or GLAD, which after the case was unsealed confirmed that O’Toole had on Sunday issued a temporary restraining order that will remain in place while he considers whether to issue a longer-lasting injunction.

The judge’s order requires prison officials to keep the inmate in the general population in a women’s facility and maintain her medical care, GLAD said. Jennifer Levi, a lawyer for the inmate at GLAD, called it a relief her client “is staying put for now.”

O’Toole is still considering whether to issue a longer preliminary injunction. Three other transgender women in prison filed a similar lawsuit on Thursday in Washington, D.C., also challenging Trump’s policy.

The U.S. Attorney’s Office in Boston declined to comment.

Moe’s lawyers said that a day after Trump signed his order, officials with the federal Bureau of Prisons informed her she was being transferred from a women’s prison to a men’s facility, exposing her to an “extremely high risk of harassment, abuse, violence, and sexual assault.”

Her lawyers said the Bureau of Prisons switched how it publicly identified her from “female” to “male” and had been poised to cut off the inmate’s access to hormones she has taken since she was a teenager to treat her gender dysphoria.

Her lawyers argued that Trump’s executive order discriminated based on sex in violation of the plaintiff’s due process rights under the U.S. Constitution’s Fifth Amendment.

The lawyers argued that her impending transfer to a men’s prison also would violate the U.S. Constitution’s Eighth Amendment prohibition against cruel and unusual punishment. – Reuters

Trump says Canada, Mexico tariffs on Saturday may not include oil

January 31, 2025 | 11:26 am

WASHINGTON – U.S. President Donald Trump on Thursday said he would soon decide whether to exclude Canadian and Mexican oil imports from the 25% tariffs that he has vowed to impose on Saturday on the countries’ products.

“We may or may not. We’re going to make that determination probably tonight,” Mr. Trump said about whether he would impose tariffs on Canadian and Mexican oil. He added that this would partly depend on prices and on whether the two countries “treat us properly.”

Mr. Trump has set a Saturday deadline to impose 25% tariffs on imports from Mexico and Canada to push the two largest U.S. trading partners to take action to halt illegal migrants and shipments of fentanyl from crossing their borders into the U.S.

But Mr. Trump on Thursday said the North American duties would be imposed “for a number of reasons” and said the tariff level “may or may not rise with time.”

Mr. Trump also said he was still considering new tariffs on Chinese goods, citing its part in the fentanyl trade. He has threatened a 10% duty on all Chinese goods, after imposing punitive tariffs on some $370 billion worth of Chinese imports during his first term in office.

“With China I’m also thinking about something because they’re sending fentanyl into our country and because of that they’re causing us hundreds of thousands of deaths, so China is going to end up paying a tariff also for that and we’re in the process of doing that,” Mr. Trump told reporters.

“We’ll make a determination on what it’s going to be, but China has to stop sending fentanyl into our country and killing our people.”

Chinese President Xi Jinping pledged in 2023 to work with then-president Joe Biden to curb fentanyl shipments into the U.S., but Beijing has called on Washington to take steps to curb demand for drugs.

Mexico’s economy ministry declined comment on Mr. Trump’s latest remarks. The office of Canadian Prime Minister Justin Trudeau was not immediately available for comment. – Reuters

Boeing names Space Station exec as new head of Starliner program

January 31, 2025 | 11:24 am

ORLANDO, Florida – The vice president leading Boeing’s Starliner spacecraft unit, Mark Nappi, has left his role in the program and been replaced by the company’s International Space Station program manager, John Mulholland, a Boeing spokesperson told Reuters on Thursday.

Mr. Nappi, who led Boeing’s Starliner program from 2022 through major engineering issues and testing mishaps, is currently in a new role “focused on identifying opportunities for streamlining improvement across the division’s space programs until he retires next month,” the company said.

Mr. Mulholland previously led Boeing’s Starliner program from 2011 before switching in 2020 to the company’s International Space Station program, which works closely with NASA under a multibillion-dollar station operations contract.

Boeing’s Starliner spacecraft, in development under a $4.5 billion NASA contract to ferry astronauts to the ISS, has faced an array of engineering challenges since 2019.

In its first test mission last summer flying astronauts, Starliner was forced by NASA to leave its crew aboard the ISS and return empty in September over problems with its propulsion system.

A panel of senior NASA officials in August had voted to have a Crew Dragon capsule from Elon Musk’s SpaceX bring them back instead, deeming Starliner too risky for the astronauts.

Paul Hill, a veteran NASA flight director and member of the agency’s Aerospace Safety Advisory Panel, said during a quarterly panel meeting on Thursday that NASA and Boeing continue to investigate Starliner’s propulsion system.

A Boeing spokesperson said on Thursday that the company and NASA have not yet determined what Starliner’s next mission will look like, such as whether it will need to repeat its crewed flight test before receiving NASA certification for routine flights.

NASA’s decision in August to have Starliner come back empty and leave its astronauts on the ISS for months longer than planned was a bruising moment for Boeing’s space unit, as SpaceX’s Crew Dragon capsule dominates the private spaceflight business. – Reuters

From bahay kubo to modern homes

January 31, 2025 | 10:55 am

The third episode of Alagang Wilcon, titled Champions Of Filipino Architecture And Design, takes viewers through the inspiring journeys of three prominent architects and designers: Arlen De Guzman, Dryan Tria, and Royal Pineda. These professionals are not just reshaping the Filipino landscape; they are intertwining the past with the future, redefining what it means to build Filipino spaces in a modernized world.

Three Perspectives and Reflections

For Dryan Tria, Chief Operating Officer and Design Consultant of DST design+, architecture is not just about structures; it’s about honoring nature. “Nature has always been our guiding light in building our projects,” he shares. Mr. Tria believes that incorporating natural elements like stone and wood reflects the beauty created by God. The design consultant believes that there is something beautiful when nature is incorporated in the process of creating.

This perspective is echoed by Arch. Royal Pineda, principal of Royal Pineda+. As a naturalist and modernist, Arch. Royal seeks to modernize Filipino design while staying true to its roots. “The very essence of a bahay kubo is sustainability — the bamboo and nipa, [are locally] available. Filipino architecture is permeable, open, and welcoming, just like the Filipino people.” He believes that modern Filipino sensibility should be accessible to everyone.

For Arch. Arlen De Guzman, the journey always starts with a story. Having been in the business since 1978, he believes that every project is an extension of his client’s lifestyle. This approach ends up in precious personal connections to his clients, making each design a deeply personal and meaningful endeavor. He also noted that “the Filipino dream is always oriented as a family—from the lolos and lolas to the apos,” a reason for why he prides himself as a Filipino designer.

A common thread among these three professionals is their commitment to shaping modern Filipino spaces that do not forget their heritage. They are passionate about breaking stereotypes that view Filipino design as baduy or outdated. Instead, they see the potential for Filipino architecture to evolve and resonate globally while remaining authentic to its roots.

Partnership as an Anchor

At the heart of their mission lies a partnership that brings their visions to life — Wilcon Depot. All three professionals recognize Wilcon as more than just a resource for materials, but a partner in innovation. “Wilcon has done a good job bridging the gap,” says Arch. Arlen. “Before, we had to [source] a lot of products abroad, but now, it is at your reach.”

For Design Consultant Dryan Tria, Wilcon is his “happy place,” where he can stay the whole day, exploring and drawing inspiration from the products available. “Wilcon guided me in the process of product knowledge. They have the professionals that will guide you through the process.” He also boasts that he has been a “batang Wilcon.”

Arch. Royal emphasizes Wilcon as a hub for sparking creativity and innovation. “[Wilcon is] your fast and easy destination for your any home fix or any styling that you want to be creative.” These testaments highlight the wide selection of quality products and solutions empowers professionals and designers alike to explore new possibilities and push creative boundaries.

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Preserving the Filipino Way

In their Alagang Wilcon episode, these professionals demonstrate how Filipino design can embrace the future while staying rooted in its cultural identity. And with Wilcon by their side, their vision of a modern Filipino aesthetic is no longer just a dream. It’s a reality that Filipinos can experience and take pride in, one home at a time.

Watch the Alagang Wilcon Episode 3 on Wilcon Depot’s Youtube channel, @Wilcon TV.

For more information about Wilcon, visit www.wilcon.com.ph or follow their social media accounts on Facebook, Instagram, and TikTok. You can also subscribe to and connect with them on Viber Community, LinkedIn, and YouTube. For inquiries, you may contact the Wilcon Depot Hotline at 88-WILCON (88-945266).

Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.

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What Gen Zs and Gen Alphas bring to the table

January 31, 2025 | 9:58 am

Anthony Oundjian, managing director and senior partner of the Boston Consulting Group’s Manila office, says workplaces will be impacted by the characteristics of both Gen Zs and Gen Alphas.

Interview by Almira Martinez
Video editing by Arjale Queral

PHL fails to meet 2024 growth goal

January 31, 2025 | 12:34 am

Buildings-skyline-wc — PHILIPPINE gross domestic product (GDP) grew by 5.6% in 2024, below the government’s 6-6.5% growth target for the year. — PHILIPPINE STAR/RYAN BALDEMOR

THE PHILIPPINE ECONOMY expanded by a weaker-than-expected 5.2% in the fourth quarter, bringing full-year growth to below the government’s target amid subdued consumption and lower farm output.

Data from the Philippine Statistics Authority (PSA) showed that gross domestic product (GDP) expanded by 5.2% in the October-to-December period, slower than the 5.5% print in the same period in 2023 and below the 5.8% median estimate in a BusinessWorld poll.

This matched the 5.2% expansion in the third quarter, which was the slowest GDP since 4.3% in the second quarter of 2023.

Full-year growth came in at 5.6%, falling short of the revised 6-6.5% target, and the 5.7% median estimate in a BusinessWorld poll. The 2024 GDP print was slightly faster than 5.5% in 2023.

“In 2024, we faced numerous setbacks like extreme weather events, geopolitical tensions, and subdued global demand, similar to the challenges we encountered in 2023,” National Economic and Development Authority (NEDA) Undersecretary for Policy and Planning Group Rosemarie G. Edillon said. “This suggests that these conditions may represent the new normal.”

On a seasonally adjusted quarterly basis, GDP posted growth of 1.8% in the fourth quarter from 1.5% in the previous quarter.

Among Asian countries that have released their data, Ms. Edillon said the Philippines had the third-fastest GDP growth in the fourth quarter, behind Vietnam (7.5%) and China (5.4%), and ahead of Malaysia (4.8%).

“While this is below our target, we continue to be one of the fastest-growing economies in both the region and the world. This is despite external and local challenges such as extreme weather events, geopolitical tensions, and subdued global demand,” Finance Secretary Ralph G. Recto said in a separate statement.

Ms. Edillon attributed the slower growth to the impact of a series of typhoons on the agriculture sector in the last few months of 2024.

Agriculture, forestry, and fishing (AFF) shrank by 1.8% in the October-December period, improving from the 2.7% contraction a year ago.

In 2024, agriculture declined by 1.6%, a reversal of the 1.2% growth in 2023.

“The agriculture sector has faced significant setbacks due to typhoons, droughts, and other climate-related disruptions,” Ms. Edillon said.

Separate PSA data showed agricultural output contracted by a record 2.2% to P1.73 trillion in 2024, brought by El Niño and then followed by La Niña. Farm output’s decline last year was the worst in almost three decades (26 years) or since the 7% contraction in 1998.

“The AFF sector, which contributes around 8% to GDP and provides livelihood for about one-fourth of the workforce, faced disruptions in crop production, livestock, and fisheries, further compounding its vulnerabilities,” Ms. Edillon said.

At the same time, the industry sector grew by 4.4% in the fourth quarter, slowing from 5.1% a year ago. For 2024, industry expanded by 5.6%, improving from 3.6% in 2023.

Construction and manufacturing were the main contributors to industry’s growth. Construction growth slowed to 7.8% in the fourth quarter from 9% in the same period a year ago, bringing the full-year growth to 10.3%.

“Manufacturing grew only by 3.1%. This performance has been hampered by subdued global demand due to geopolitical tensions and the slow recovery of advanced economies,” Ms. Edillon said.

“There are industries like semiconductors that still need to update their product offerings to meet changing demand.”

The services sector, which accounted for 62% of total GDP, expanded by 6.7% in the October-to-December period, slowing from 7.4% in the same period in 2023. For the full year, services growth stood at 6.7%.

LACKLUSTER CONSUMPTION
Meanwhile, household final consumption expenditure, which accounts for over 70% of the economy, grew by 4.7% in the fourth quarter, slowing from 5.2% in the third quarter and 5.3% in the same quarter in 2023.

For the full year, household consumption rose by 4.8%, slowing from 5.6% in 2023. Private consumption accounts for about three-fourths of the economy.

Ms. Edillon said household consumption was affected by the series of typhoons that hit the country in the fourth quarter.

“This one has dampened the growth momentum… Although we did see that there was an increased spending on travel, on transport, and on recreation and culture. But it was not enough to counter the slowdown in the other expenditure items,” she said.

Ms. Edillon said high prices of food, particularly vegetables, also weighed on consumption in the fourth quarter.

“We’re hoping that this is very temporary… We hope that the situation will stabilize soon,” she added.

Miguel Chanco, chief emerging Asia economist at Pantheon Macroeconomics, said the latest GDP data show a renewed deterioration in household consumption.

“This (4.7% rise in consumption in the fourth quarter) marks a return to the 10-year-plus lows seen in the first half of last year, if we’re to exclude the anomalous COVID-19 years, with the full-year outturn of 4.8% representing the slowest growth since 2010,” Mr. Chanco said in a report.

“We’d like to reiterate that private consumption is likely to remain subdued even though inflation has normalized, and interest rates are now falling, as household balance sheets are still weak, plagued by low savings and high debt,” he added.

GOV’T SPENDING
PSA data also showed government final consumption expenditure (GFCE) rose by an annual 9.7% in the October-to-December period, a turnaround from the 1% decline in the same period in 2023.

In 2024, government spending grew by 7.2%, faster than 0.6% seen in 2023.

“We are quite happy with this performance of GFCE… That particular spending growth is actually quite respectable and in fact supportive of the entire economy,” Ms. Edillon said.

In a separate interview, Ms. Edillon said seven infrastructure flagship projects (IFPs) were completed last year and 13 more are on track to be finished this year.

Gross capital formation, the investment component of the economy, grew by 4.1% in the fourth quarter, sharply slowing from 11.6% in the same quarter in 2023.

For the full year, gross capital formation expanded by 7.5%, faster than 5.9% a year ago.

Ms. Edillon said that in general, the investments remain fine as there is still a huge backlog of infrastructure projects that will “tide us over until we get all these big investments coming in.”

“With respect to foreign investments, you still have geopolitical tensions. This is a big problem but we’re hoping these are very temporary,” she added.

Meanwhile, exports of goods and services grew by 3.2% in the fourth quarter, bouncing back from the 2.5% contraction in the same period a year ago, driven by a 13.5% rise in exports of services. Exports of goods fell by 4.6%.

For 2024, exports of goods and services expanded by 3.4%, faster than the 1.4% growth in the previous year.

Imports increased by 3.2% in the fourth quarter, faster than the 2% in the prior year.

For the full year, imports expanded by 4.3%, quicker than the 1% growth in 2023.

OUTLOOK
Meanwhile, NEDA’s Ms. Edillon said the government is confident on hitting at least the lower end of the 6-8% target for 2025 as government agencies are instructed to “think continuity and maximum impact.”

“Looking ahead to 2025, we want to regain our growth momentum driven by strategic investments and initiatives designed to strengthen resilience and lay the foundation for long-term, inclusive growth,” she added.

Mr. Recto said the government remains optimistic about the economic outlook this year.

“A lower inflation rate gives us more room to ease interest rates, which will further boost consumption,” he added.

Capital Economics Senior Asia Economist Gareth Leather said he expects the Philippine economy to grow by 6% this year.

“Strong and steady growth supports our view that the easing cycle will remain gradual over the coming months,” Mr. Leather said in a report.

The Bangko Sentral ng Pilipinas began its rate-cutting cycle in August last year, delivering a total of 75 bps worth of reductions.

“A key uncertainty over the coming year is whether and to what extent Donald Trump follows through with his threats to impose tariffs and clamp down on immigration. The Philippines is less vulnerable than other parts of the region to tariffs. However, Trump’s deportation plans could affect remittances from the US to the Philippines, which are equivalent to around 3.5% of the country’s GDP,” Mr. Leather said. — A.R.A. Inosante

ADB approves $500-M loan for Philippine labor market reforms

January 31, 2025 | 12:33 am

Job fair-applicants — Applicants look for work at a job fair in Manila. — PHILIPPINE STAR/EDD GUMBAN

THE PHILIPPINES has secured a $500-million policy-based loan from the Asian Development Act (ADB) that will fund the government’s labor market programs and reforms aimed at boosting job creation.

The Business and Employment Recovery Program-Subprogram 2 supports government efforts “to achieve inclusive economic growth by equipping the country’s labor force, including vulnerable youth, with the skills required to meet evolving industry needs,” the ADB said in a statement.

The program will also aim to raise women’s participation in the workforce through technical and vocational education and training, as well as provide better access to opportunities.

Under the program, the government is targeting to increase formal employment in the private sector by around 600,000 to 700,000 jobs annually. This would help raise the share of private sector jobs to total employment to 51%, versus 49% in 2019.

“While job recovery in the Philippines has been encouraging in the post-COVID-19 (coronavirus disease 2019) period, the quality of jobs remains a critical concern, with many workers still facing challenges such as underemployment, informality, and limited access to decent work opportunities,” ADB Country Director for the Philippines Pavit Ramachandran said.

The program also seeks to provide skills training for 5,000 workers through private sector-led programs such as the SkillsUpNet Philippines.

The government also hopes to boost the number of job placements through public employment service offices in local government units (LGUs) by as much as 120,000 annually.

It also wants more LGUs to implement the JobStart Philippines skills training program for the youth.

Latest data showed the unemployment rate dropped to 3.2% in November, translating to 1.66 million unemployed Filipinos. The November jobless rate was lower than 3.9% in October and 3.6% in the same month in 2023.

For the first 11 months of 2024, the jobless rate averaged 3.9%, easing from 4.5% during the same period in 2023.

BSP may continue easing despite Fed’s pause

January 31, 2025 | 12:32 am

By Luisa Maria Jacinta C. Jocson, Reporter

THE BANGKO SENTRAL ng Pilipinas (BSP) could continue its easing cycle despite the US Federal Reserve’s policy pause, analysts said, but flagged the need for caution.

“Despite the Fed’s pause, we anticipate a 25-basis-point (bp) policy rate cut at the BSP’s meeting in February, narrowing the interest rate differential between the BSP and the Fed to 100 bps,” Metrobank Research said in a report.

The US central bank held rates steady overnight as widely expected, with Fed Chair Jerome H. Powell saying there would be no rush to cut them again, Reuters reported.

The Fed kept its policy rate at the 4.25%-4.5% range after slashing rates by a total of 100 bps last year.

President Donald J. Trump’s policies remain a risk for the Fed’s policy outlook. Mr. Trump gave a Feb. 1 deadline for imposing new tariffs on products from Canada and Mexico, and possibly on imports from China as well.

Metrobank said it expects the Fed to continue its easing cycle this year, though at a moderate pace, for a total of 75 bps worth of cuts for 2025.

“If the Fed did not lower interest rates, then it probably feels that there is little inflationary pressure and is comfortable about current US economic growth,” Peter Lee U, dean of the University of Asia and the Pacific’s School of Economics, said.

“Bottom line is if the US Fed maintains their interest rate, we can maintain our own interest rates unless we want to depreciate or appreciate,” he added.

John Paolo R. Rivera, a senior research fellow at the Philippine Institute for Development Studies, said the Fed’s latest decision and signals could prompt the BSP to remain cautious and keep rates higher for longer.

“A premature rate cut could weaken the peso and drive inflationary pressures, especially given the country’s reliance on imported goods and energy,” he said via Viber.

“If the Fed delays its easing, the BSP may hold off on rate cuts to maintain interest rate differentials and prevent capital outflows,” he added.

The BSP began its rate-cutting cycle in August last year, ahead of the Fed, and delivered a total of 75 bps worth of reductions. This brought the benchmark to 5.75% by end-2024.

BSP Governor Eli M. Remolona, Jr. has signaled further easing this year as the current policy rate is still in “restrictive territory,” but cited that rate cuts will likely be implemented in “baby steps.”

“Also, a prolonged high-rate environment in the US strengthens the US dollar, which could put depreciation pressure on the peso, raising import costs and inflation,” Mr. Rivera said.

“This can also result in capital outflows from the Philippines as investors seek safer, higher-yielding US assets.”

The Development Budget Coordination Committee expects the peso to range from P56-P58 per dollar in 2025 and P55-P58 in 2026.

The peso has been under volatility in the past months as the dollar surged on bets of slower-than-expected Fed cuts on expectations of inflationary pressures from Mr. Trump’s economic policies.

“Given the Fed’s cautious stance, expectations for rate cuts may be pushed further depending on US inflation and job market trends,” Mr. Rivera said.

“Overall, the Fed’s pause and cautious messaging reinforce the need for careful monetary policy calibration in the Philippines to manage inflation, support economic growth, and maintain peso stability.”

Peso could overshoot DBCC assumptions until 2026 — BSP

January 31, 2025 | 12:31 am

THE PESO-DOLLAR exchange rate could breach the government’s assumptions from this year to 2026 amid expectations of slower rate cuts by the US Federal Reserve, the Bangko Sentral ng Pilipinas (BSP) said.

“The exchange rate could settle slightly above the Development Budget Coordination Committee’s (DBCC) assumptions for 2025 and 2026,” it said in its latest Monetary Policy Report.

The DBCC expects the peso to trade at around P56-P58 per dollar this year and P55-P58 in 2026.

“This projection is due to the slower pace of monetary policy easing by the United States Federal Reserve (US Fed) and recent near-term movements in the peso,” the central bank said.

The US central bank held interest rates steady on Wednesday and Federal Reserve Chair Jerome H. Powell said there would be no rush to cut them again until inflation and jobs data made it appropriate, Reuters reported.

After the Fed lowered rates three times in the latter part of last year, inflation has largely moved sideways in recent months, but “remains elevated,” the central bank’s policy-setting Federal Open Market Committee, said in a statement after a unanimous decision to keep the benchmark overnight interest rate in the current 4.25%-4.5% range.

Emerging from their first policy meeting during President Donald J. Trump’s second term in the White House, Mr. Powell said Fed officials are “waiting to see what policies are enacted.”

As a result, Fed fund futures still imply around 48 basis points (bps) of easing this year, compared to 49 bps earlier in the week. The next move is not expected until June, when the probability of a cut is put at 73%.

The BSP expects the Fed to deliver up to 75 bps worth of cuts this year and 25 bps for 2026.

The central bank said the peso depreciated in October and November “due to the broad strengthening of the US dollar after the US Fed signaled that there was no urgency to ease policy rates further.”

In 2024, the peso closed at its record low of P59 thrice (on Nov. 21, Nov. 26, and Dec. 19.) It has yet to breach this all-time low, which was first set in October 2022.

“Concerns about the inflationary impact of (US President) Donald J. Trump’s economic policies also weighed on the peso,” the BSP added.

Mr. Trump has proposed several policies that could stoke inflation, such as stricter import tariffs and tighter immigration measures.

He has pledged tariffs as high as 60% on China, 25% on Mexico and Canada and an up to 10% universal tariff.

The BSP said the recent currency weakness was also influenced by slower gross domestic product (GDP) growth in the third quarter, higher outstanding debt, a wider trade and current account deficit, as well as political uncertainty.

“Nonetheless, the peso’s depreciation was partly tempered by sustained structural FX inflows from foreign direct investment and foreign portfolio investment, and higher overseas Filipinos remittances,” it added. — Luisa Maria Jacinta C. Jocson

More innovations and revivals

January 31, 2025 | 12:30 am

What to expect from the Philippine auto industry in 2025

The ever-changing automotive landscape evolves yearly and is set to experience more transformation in 2025. As the earth takes another lap around the sun, new trends, innovations, and opportunities are introduced to the industry as often as racecars make pitstops on their tracks.

Last year, global vehicle sales reached 88.2 million units, a 1.7% increase from 2023, supported by ongoing inventory restocking throughout the year as supply chains become more stable, according to rating agency S&P Global. For 2025, the agency forecasts 89.6 million vehicles sold or a 1.7% year-over-year rise.

In the Philippines, the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) and the Truck Manufacturers Association (TMA) reported that the number of cars sold hit a record-high 467,252 units in 2024, albeit a little lower than the 468,300 sales target of the industry. However, CAMPI and TMA predict vehicle sales will rise by 10% in 2025 amidst several trends that have attracted car buyers.

Among these developments is the push of governments for electric vehicles to go mainstream. Fiscal incentives in the country such as tax exemptions and reductions as well as investment priorities have at least gotten Filipinos to consider environmentally friendlier automotive options. Add to that non-fiscal incentives such as priority registration and licensing, exemptions from number coding schemes, and dedicated parking slots make owning an electric vehicle more convenient, cost-effective, and appealing.

The rise of new technology is also expected to shape the industry in terms of safety and autonomy. While fully self-driving cars are still considered a pipedream in 2025, advancements in the area are improving rapidly and can be seen in advanced driver assistance systems (ADAS). Innovations in this area can lead to enhanced convenience and safety by minimizing human errors in a range of scenarios and conditions. These developments include speed limit information, lane-keeping assistance, and adaptive and predictive cruise control.

Beyond sustainability and efficiency, another area experiencing rapid evolution is car interiors. Car cabins are getting smarter and more comfortable, with AI-powered infotainment, customizable lighting, eco-friendly materials, and ergonomic seating making every ride more enjoyable. Features such as heating, ventilation, and massage functions may even be installed in seats this year.

As the world has become more modern, everything has been connected to the internet, including cars. This trend has seen automobiles transform into digital hubs, offering on-demand entertainment, real-time navigation updates, and cloud-based software enhancements. Internet in cars has also paved the way for subscription-based features, where owners can unlock premium functions like advanced driver assistance, heated seats, or enhanced infotainment services for a monthly fee.

With these innovations headlining what is shaping up to be a robust year for the industry, automakers are rolling out new models that embody these trends. These new releases usher in a new era of transportation, one that meets the needs of modern drivers.

Chery Auto Philippines, Inc. is reportedly launching the eQ7, an all-electric compact crossover, this year. Equipped with a 211-horsepower motor and a 67.12 kWh LFP battery, the new model offers a range of up to 512 kilometers on a full charge, making it a practical choice for both city driving and longer trips, while contributing to a more sustainable driving experience.

Interior features of the eQ7 are as modern as it gets with a 12.3-inch screen with Bluetooth, electric seats with memory, a wireless charger, and a cell phone forgetfulness alert. Other features of the new model may also include a driver monitoring system, multi-zone climate control, an adjustable steering wheel as well as an anti-theft system. Six airbags, collision detection, automatic emergency braking, lane-keeping, and adaptive cruise control are also installed in the vehicle to ensure safety.

Mitsubishi Outlander PHEV — www.mitsubishicars.com

Following its European launch last year, Mitsubishi Motors Philippines Corp. is gearing up to bring another hybrid electric SUV into the country, the Mitsubishi Outlander Plug-in Hybrid electric vehicle (PHEV). The model comes with a new 22.7 kWh battery, good for an 86-kilometer drive powered by electric power, and a 53-liter fuel tank.

The Outlander retains some of its predecessor’s features including the overall look and driving modes. The brand worked on the model’s convenience and utility by updating its Super All-Wheel Control (S-AWC) system, fine-tuning the vehicle’s steering and suspension, as well as giving the model a new grille with active shutters. Aside from these features, the Outlander also possesses dual-zone automatic climate control, a 12.3-inch infotainment screen, and a suite of advanced driver-assist features including Blind Spot Warning, Rear Cross Traffic Alert, Lane Change Assist, Forward Collision Mitigation System, Auto High Beam, and Adaptive Cruise Control.

Changan’s Hunter REEV — Changan PH Facebook ppage

The world’s first Range-Extended Electric Vehicle (REEV), Changan’s Hunter REEV, is also coming to the Philippines this year. The 4X4 pickup truck with a PHEV system uses a series hybrid powertrain that charges its batteries giving the vehicle an astonishing range of 1,031 km when fully charged and has a full tank of gas.

As a pickup truck, the Hunter has a payload capacity of 495 kg with a 2.5-ton towing capability. Safety and security are also prioritized in the model as it is installed with Anti-theft devices, Anti-Lock Braking System, Hill-Start Assist Control, and many more features. Apple Carplay/Android Auto, Multi-function Steering Wheel, Navigation System, and a touchscreen infotainment system are just some of the other amenities also available in the model.

Toyota Motors Philippines’ (TMP) best-selling plate, the Toyota Vios, will also receive upgrades this year, continuing its legacy as the top choice for Filipinos looking for a subcompact sedan. Consistently among the country’s best-sellers, TMP produces the Vios in the brand’s plant in Santa Rosa making the model truly by Filipinos for Filipinos.

The improved Vios stands out with long squinting headlights, teardrop-shaped fog lamp vents, and a wide trapezoidal grille. Its interior will also feature a redesigned steering wheel, a more comfortable cabin, and a more advanced dashboard. While technological features vary per variant, Optitron gauge clusters, iPod connectivity, and steering-wheel-mounted audio controls are available.

Next Generation Toyota Tamaraw — toyota.com.ph

Similarly, this year marks the return of the Toyota Tamaraw, one of the most iconic models of the brand which has served generations of Filipinos from across the country. Renowned for its signature versatility and reliability, the relaunched automobile is the practical choice for families, aspiring business owners, and car enthusiasts looking for a vehicle with a wide range of applications.

The new Tamaraw will have two engine options: a 2.0-liter 1TR-FE gasoline engine and a 2.4-liter 2GD-FTV diesel mill. Safety is also prioritized in the Tamaraw lineup with its anti-lock braking system, airbags, and reinforced chassis for enhanced crash protection. To bring the model to modern times, Toyota has even added a touchscreen infotainment system (on higher trims), USB ports, and practical amenities that enhance the usability and comfort of the vehicle.

As we begin the road trip of 2025, the journey of the Philippine automotive industry is shaping up to be full of new trends, breathtaking features, and timely innovation. Whether it’s the sustainable eQ7, the versatile Toyota Tamaraw, or the technologically enhanced Mitsubishi Outlander PHEV, there’s no shortage of options for the discerning Filipino driver.

With advancements in electric mobility, hybrid technologies, and innovative features, 2025 promises to be a year when car manufacturers speed up to a future that promises transformation, sustainability, and reliable mobility. — Jomarc Angelo M. Corpuz