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Wolfgang’s Steakhouse wants a bite of corporate market

By Arra B. Francia, Reporter

UNITED STATES-BASED Wolfgang’s Steakhouse is looking to serve the Philippine corporate market as it opens its newest location at the heart of Ortigas District, aiming to capture the tastebuds of businessmen hustling through another 9 to 5 workday. 

The Ortigas restaurant, located at the ground floor of The Podium, is the group’s second location in the Philippines, after setting up shop in Newport Mall within the Resorts World complex in 2016. This is the group’s 19th outlet globally.

“We wanted to be near bankers and corporate towers. And tamang-tama naman, we’re really near the BDO tower so we talked to the SM group, and they had this place left, this one tiny spot. We managed to make it work,” Raymund Magdaluyo, the head of Excello Restaurant Management Group, said during a media roundtable for the restaurant’s opening. Excello is the local partner of Wolfgang’s Steakhouse.

“This is a natural market, you have the corporate people. And you have the families din,” he added.

The Ortigas restaurant has a capacity of 75 to 80, smaller compared to the one in Resorts World, which has 120 capacity.

Having a steakhouse in a country with a booming economy is important, according to Mr. Magdaluyo, as it becomes a place where matters of importance can be discussed.

Wolfgang’s Steakhouse is hoping to attract expats from the nearby Asian Development Bank headquarters, as well as employees working at the BDO Corporate Center or San Miguel Corp.’s head office.

“I feel each vibrant city has its own steakhouse, especially our economy is growing. When you’re closing a deal, or having a special gathering as well,” he said.

Peter Zwiener, Wolfgang’s Steakhouse president and managing partner, said the decision to put up a second location was dependent on the Resorts World restaurant’s performance, which turned out to be well-received by the market.

“Once we started doing well in Resorts World, we started looking for store number two and number three. It was either going to be here, Ortigas, or Fort Bonifacio. So we decided to do it here in Ortigas first and then Fort Bonifacio in June,” he said.

What differentiates Wolfgang’s from other steakhouses is their focus on quality, Mr. Zwiener said, adding they import beef from the United States to ensure its quality.

“We focus on the quality. We actually ship our beef from the United States on a weekly basis. The beef that you eat here could be the same as the one you’ll be eating in our New York restaurant, in our Miami restaurant. We bring the meet to whichever market we go to,” Mr. Zwiener said.

The private banker-turned-restaurant operator explained the beef is aged for 28 days.

“We never freeze our beef, we age it. We have our own aging room, use the same equipment, do all the training in New York… All the key players have actually worked in our New York restaurant to learn, to make sure the consistency level is there,” Mr. Zwiener said.

Following positive response in the Philippines, the company is looking to strengthen its brand in other Asian nations as well.

“Wolfgang brand will continue growing… We’re going to put one in Shanghai in China, probably Indonesia and Malaysia, too. So the Asian market is extremely strong, and part of it is because the brand is getting stronger,” Mr. Zwiener said.

Auto firms report ‘record-breaking’ sales

Car Models infographic

By Kap Maceda Aguila

IT came as no surprise when the consolidated vehicle sales report released on Jan. 11 by the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) — an industry association of 14 brands — and the Truck Manufacturers Association (TMA) revealed that deliveries grew by 18.4% in 2017, or 66,101 units more than the 359,572-unit total for the 12 months of 2016.

The 425,673 vehicles sold by CAMPI and TMA member companies in 2017 “exceeded the groups’ target of 400,500 units, and nearly [hit] the whole industry target of 450,000 units,” according to a statement released by the associations.

It must be noted that another industry group, the Association of Vehicle Importers and Distributors (AVID) — composed of 17 companies representing 26 brands — at press time has not released its own figures. But Hyundai Asia Resources, Inc. (HARI), the group’s biggest seller, has reported sales of 37,678 vehicles in 2017.

SWELL IN SALES
Notwithstanding the projections of CAMPI and TMA, many industry observers had already anticipated a swell in vehicle sales owing to the 2018 implementation of Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN), which revises taxes imposed on new vehicles. Though watered down from a more extreme tariff scheme that would have resulted in drastic rises in retail costs, TRAIN still had the net effect — in most cases — of increasing the prices of vehicles owing to a restructured excise-tax schedule.

“[In] December 2017 alone, the group sold 45,494 units with 33.4% growth from 34,104 [units] during the same month in 2016,” continued the CAMPI statement. This reflects the observations that a significant number of people scrambled to make last-minute vehicle purchases before the advent of the new year.

Interestingly, last year’s numbers actually represented a slowdown in domestic auto sales growth. A previous BusinessWorld article revealed the uptick in vehicle sales were pegged at 29.5%, 22.9% and 24.6% for 2014, 2015 and 2016, respectively. Last year’s 18.4% increase only outpaced the 2012 (11%) and 2013 (16%) rate since the double-digit spurt started.

“We ended 2017 with a positive note. Aggressive promos, new model updates and the hard work of members helped contribute to expanding the Philippine market,” said Rommel R. Gutierrez, CAMPI president and also a first vice-president at Toyota Motor Philippines (TMP).

Sales of commercial vehicles (comprised of Asian utility vehicles, light commercial vehicles, light trucks, trucks and buses) surged 26.4% from 226,384 units in 2016 to 286,249 units last year. In comparison, total passenger car sales in 2017 grew by 4.7% from 133,188 to 139,424

TOYOTA TOPS FOR 16TH STRAIGHT YEAR
Meanwhile, Toyota Motor Philippines achieved its 16th consecutive triple crown — topping total, passenger car, and commercial vehicle sales in the domestic market. Moving 183,908 units represented a growth of 15.9% over 2016’s figure of 158,728. TMP cornered a hefty 43.2% of the local market in 2017.

Toyota was followed by Mitsubishi Motors Philippines Corporation, which secured a 17.29% share (73,590 units), and Ford Motor Company Philippines, which took in 8.6% (36,623 units). Rounding out the top five were Honda Cars Philippines with 7.46% (31,758 units), and Isuzu Philippines Corp. with 7.07% (30,086 units).

TMP’s top-selling passenger car in 2017 was the Vios (36,734 sold), followed by the Wigo with 19,295 units. Still, the Fortuner — officially classified a commercial vehicle — actually outsold the Vios with 39,680 units.

RECORDS ALL AROUND
While the growth rate of sales has slowed down compared to that in 2016, a number of companies have reported achieving best-ever sales figures last year. Ford Philippines called it a “record year” with an “all-time best monthly performance.” December 2017 sales for the company registered an increase of 45% year on year to 4,629 vehicles — driven by sales of the Everest, EcoSport and Ranger. Consolidated sales revealed a “fifth consecutive year of record sales with 2017 retail sales rising 9% from the prior year to 36,623 vehicles… [with] the Everest [remaining as] Ford’s top-seller in the Philippines in 2017 with full-year sales rising slightly from the prior year to 12,455 vehicles. This included Everest’s all-time best month in December with sales increasing 48% year over year to 1,582 vehicles.”

It was the same kind of story coming out of Honda Cars Philippines, Inc. (HCPI). In a statement, HCPI reported it had “continued its growth with record-breaking sales results for the calendar year of 2017… [with] 31,758 vehicles, up by 37% compared to 2016 with 23,199 vehicles.” The company added it “beat its own record by posting the highest sales results in the brand’s history in the Philippines” with 4,961 vehicles sold in December last year, or a 77% rise over the same month in 2016.

Helping drive HCPI’s numbers were the 9,430 deliveries of the City (the company’s best-selling model), sales of which grew 6%. Following it was the BR-V SUV, with 7,212 units sold. Still, the fastest pace was set by the Civic, increasing by 66% with 4,146 units sold.

Isuzu Philippines Corporation (IPC), which sold 30,086 units last year (growing 10% from the 2016 figure of 27,361), also recorded the company’s highest-ever sales performance in a calendar year and month. A total of 13,157 Isuzu Mu-X SUVs were sold, up 4% (from 12,657 units last year). In December, 1,997 Mu-X units were sold, up 27% from the month before. Additionally, 4,675 D-Max pickup trucks were sold from January to December, up 17.9% from the previous year.

IPC’s truck sales also recorded a healthy growth rate of 23% with 4,599 units sold in 2017, from 3,734 the year before. The company attributes much of the movement to its popular N-Series model.

Over at Bermaz Auto Philippines, Inc. (BAP), distributor of Mazda vehicles and parts in the country, “record sales numbers for the month of December and the full year of 2017” were also reported. A consolidated figure of 5,244 units “represents the company’s best sales year since taking over the Mazda distributorship five years ago… [with] the December 2017 sales registration of 1,006 cars, SUVs and trucks [seeing] best-ever monthly sales performance for the brand.”

BAP said nine months in 2017 saw the company’s highest on record since 2004, and that the Mazda2, Mazda6, CX-3, CX-5, CX-9 and MX-5 all logged their “best-ever sales year in 2017.”

HARI also posted an all-time-high 37,678 units in sales last year, representing a 12% hike over the company’s 33,695-unit total in 2016. The Hyundai Accent proved to be its strongest seller, moving 16,454 units while registering a 33% growth over 2016. With 1,963 units sold, the Elantra mustered a 20% gain over the previous year.

HARI’s light commercial vehicle segment tally notched a 23% gain in 2017 with sales of 1,963 units, compared to 1,631 units in 2016. The largest contributor to the segment’s sales remained to be the Grand Starex with 4,295 units sold in 2017, increasing 15%, or 562 units, from the previous year.

“The fastest growing unit in this segment is [the] H-100, which closed at 3,439 units for 2017 from 2,280 units last year. H-100 registered an enormous growth of 51%,” HARI said in a statement.

Despite last year’s sales performance, CAMPI maintained it assumes a “cautiously optimistic outlook for 2018.” Said Mr. Gutierrez: “CAMPI remains confident that the market will be able to adjust to the new auto excise tax in 2018.”

Elmer Borlongan: Chronicling the Everyman

IF HE were not a painter, Elmer Borlongan would want to be a photo journalist. “I like how a single image has the power to be part of our collective memory,” he said. But then again, his latest retrospective exhibition, called An Extraordinary Eye for the Ordinary, has done just that — and more, for it is filled with 200 images that mirror the shared memories of the Filipino everyman.

The iconic Borlongan paintings star the hoi polloi in urban settings. Using his signature figurative expressionism, he depicts the common Filipino with touches of humor and wit.

“Gusto ko kahit ang karaniwang tao, nakakarating sa kanila ang ipininta ko. [Mayroong] passion sa pangkaraniwang tao, na kahit maliit sila, malaki ang kontribusyon nila sa society at gusto ko ding ipakita na kahit mahirap, nandoon pa din ang hope (I want my paintings to reach even regular folk. I have a passion for the ordinary Filipino, that they, too, make big contributions to society. I want to show that they may be poor, but there is still hope),” he told BusinessWorld at the sidelines of his exhibition opening on Jan. 20 at the Metropolitan Museum of Manila.

CHANGING STYLES
An Extraordinary Eye for the Ordinary, which remains on view until March 28, highlights the artist’s works from 1979 to 2015. Most of them are images of street life and living, of underprivileged Filipinos doing mundane tasks, and of religion and love for music.

But there is one mixed media painting called Seryeng Punk (Punk Series), done at the start of his career in 1987, that stands out because it is very different from the rest. It is abstract, chaotic, and angsty, very unlike the Borlongan we know today.

The retrospective is, after all, a documentation of Mr. Borlongan’s journey as an artist, his quest for his own style, and the political contexts he experienced along the way. Before becoming a household name associated with figurative realism, Mr. Borlongan, like many other artists, experimented with and copied the styles of others.

At the age of 11, he began taking formal art lessons under Fernando Seña. Mr. Borlongan said that at that time he enjoyed copying the pictures he’d see in comics, books, and magazines, and the classes opened his eyes to a wider world. “While studying under [Seña] at the Children’s Museum and Library, Inc. in 1978, he’d open the pages of the encyclopedia and show the works of his favorite Dutch painters — Rembrandt and Frans Hals — in class,” said Mr. Borlongan.

The most challenging part of being an artist is the search for one’s own identity. “If I knew from the start what and how to approach my paintings, I could have gone straight to what I’m doing right now instead of imitating all sorts of styles. But I guess it’s part of the process in making art — you discover something and discard what you’ve learned in the early stages of being an artist,” he said.

A year after making Seryeng Punk, he became a social realist. He had his first solo show in 1993 at Boston Gallery in Cubao, where he exhibited works done in the style of figurative expressionism, influenced by artists Danny Dalena, Onib Olmedo, and Jaime de Guzman.

Among his trademarks are figures of men who are brown and bald and with piercing eyes. “The bald men and children started appearing in 1993. The hair of a person as a crown immediately describes the character of the person. [But] by removing the hair, the character of the figure is focused mainly on the face of the individual,” he said. The eyes — the windows to the soul — are also his signature. “The people in my paintings don’t show so much emotion, but you can see it in their eyes,” he said.

CITY BOY
Born in 1967, Mr. Borlongan grew up in Mandaluyong City, and it was there that he saw what urban life is like. But since he got married and moved in Zambales where he’s been living with his family for 14 years and counting, he said his outlook has changed and he’s closer to nature — but his figurations have remained constant.

“Kailangan sa artist ang sincerity. Gusto kong ipakilala ang sarili ko sa mundo, at one way to do that is from my own firsthand experience na lumaki ako sa siyudad, maraming influence sa education, sa art (Artists need sincerity. I wanted to introduce myself to the world and one way to do that is to tell it from my firsthand experience, that I grew up in the city, and the many influences of art and education),” he said.

Over the years, he’s experimented with other styles including photo realistic painting, but decided to stick with figurative realism.

“’Yung development ko hindi overnight. It’s a series of experimentation na ma-reach ko ’yung gusto kong gawin. Pero ayoko din naman maging stagnant o mag stick sa isang style ng painting. Gusto ko pa din habang tumatagal nage-explore pa din ako. Nagbabago ang pananaw ko sa buhay. Malaking bagay kasi ang environment sa ginagawa ko, kung nasaan ako ’yun ang reflection ng subjects ko (My development did not happen overnight. It took a series of experimentation for me to reach what I truly wanted to do. But then, I don’t want to become stagnant or to stick to one style of painting. The longer I am around I will still explore. My outlook in life has changed. The environment I am in greatly affects what I do, where I am is reflected in my subjects),” he said.

He paints every day at his studio at his home in Zambales. He works from 8 a.m. to 5 p.m., but only when there is natural light.

“Every day na pagbangon ko, excited na ’ko agad magpinta, o mag-drawing sa sketch pad (Every day when I wake up, I am excited to start painting at once, or to draw on a sketch pad). ’Pag may (when there is an) interesting subject, I do doodles and thumbnail sketches to practice my thumb and wrist. Very traditional ang process, it’s free hand, no grid and projector,” he said.

The painter, who may be a photojournalist in a parallel universe, has one thing in mind whenever he works on his art: “How do I challenge myself that what I do will be part of the collective memory of the many?” — Nickky Faustine P. de Guzman

Sereno denies hand in ‘Ilocos 6’ decision

COURT OF Appeals (CA) Associate Justice Remedios S. Fernando claimed yesterday that Chief Justice Maria Lourdes P.A. Sereno asked the CA to defy the show cause order of the House of Representatives in relation to the case of the six officials of the Ilocos Norte provincial government. In yesterday’s hearing of the House committee on justice on the impeachment case filed by lawyer Lorenzo G. Gadon against Ms. Sereno, Ms. Fernando said that the chief justice “advised the three (CA) justices (Stephen Cruz, Edwin Sorongon and Nina Valenzuela) to file a petition before the Supreme Court with a TRO (temporary restraining order) at siya na daw ang bahala (and she will take care of it). And everybody was silent about it.” Lawyer Jojo Lacanilao, spokesperson of the chief magistrate, denied the allegation. In a statement, Mr. Lacanilao said Ms. Sereno “did not advise [CA Presiding Justice Andres Reyes, Jr.] what particular legal remedy or petition the three CA justices should take. Neither did she assure Justice Reyes of a favorable outcome on such a petition by telling him that she would take care of that petition in the Supreme Court.” Mr. Lacanilao also stressed that the Ms. Sereno inhibited from the case of the “Ilocos 6” when their case was heard before the Supreme Court. — Minde Nyl R. dela Cruz

Back to drawing board for ailing Djokovic

MELBOURNE — It’s back to the drawing board for ailing 12-time Grand Slam champion Novak Djokovic with his immediate playing future uncertain after an injury-ravaged exit from the Australian Open.

The former world no. 1 cut a disconsolate figure as he played to the bitter end in a agonizing defeat to South Korean young gun Chung Hyeon in Monday’s fourth round, ending his chance, for now, of a seventh Australian title.

The 30-year-old Serb leaves Australia to reassess his options after a persistent right serving elbow injury flared along with a hip injury.

Djokovic was playing his first tournament in six months after opting against elbow surgery to ease his way back to the game.

But it all spectacularly unravelled on Rod Laver Arena as he winced in pain through his physical ordeal as Chung claimed his greatest win.

The question now for Djokovic is whether this setback is temporary or more signs of a painful, irreversible decline.

“It’s frustrating, of course, when you have that much time and you don’t heal properly. But it is what it is,” he said in the wake of his defeat.

“There is some kind of a reason behind all of this. I’m just trying my best obviously because I love this sport.

“I enjoy training. I enjoy getting myself better, hoping that I can get better, perform and compete.

“This was one of those days where, unfortunately, it was too much to deal with.”

Djokovic, who spent four years at no. 1 in the rankings, has slipped to 14 and may edge to 13 in the new rankings after the Open, but he could face some time out to fully recover from his troublesome elbow.

“It’s not great. At the end of the first set it (elbow) started hurting more. So, yeah, I had to deal with it till the end of the match,” he said.

“Now I don’t know. I have to reassess everything with my team, medical team, coaches and everybody, scan it, see what the situation is like.”

Djokovic has been forced to tinker with his serve to compensate for the elbow, with a noticeable diminishing of his power.

A flesh-colored compression sleeve he wore on the right arm during the tournament also appeared to have little effect.

“I felt the level of pain was not that high that I needed to stop the match, even though it was compromising my serve,” he said after his defeat.

Djokovic hasn’t won a Grand Slam since the 2016 French Open and it appears his grinding style of play has taken its physical toll.

Stan Wawrinka is another ailing great whose future is uncertain after he slumped out in the second round in his first tournament since Wimbledon following left knee surgery.

Andy Murray pulled out of the opening Grand Slam of the year before it started and has since undergone hip surgery with no sign yet when he will return. — AFP

Thai company eyes solar farms in PHL, Vietnam

BANGKOK — Thailand’s B.Grimm Power Pcl plans to invest 10 billion baht ($314.17 million) this year as part of a plan to raise its power generation capacity to 5,000 megawatts by 2022, President Preeyanart Soontornwata said on Monday.

Most of the investments will be in solar farms, and the company is negotiating with partners in Vietnam, Malaysia, Indonesia and the Philippines, she said in an interview.

B.Grimm Power operates co-generating gas plants, solar farms, and hydroelectric power plants.

She expects to conclude at least one deal this year, she said, adding that the projects should have a minimum internal rate of return of 15%.

Revenue in 2018 is likely to be 15% to 20% higher than last year as three power plants with a combined capacity of 399 MW will come online, she said. The company has 1,714 MW of installed capacity as of now, according to its Web site.

Shares of the company ended 4.2% higher on Monday, while the benchmark stock index closed up 0.2 percent. — Reuters

DoT prepares budget to make PHL ‘faith tourism’ hub

THE DEPARTMENT of Tourism (DoT) is preparing a budget proposal for the restoration and development of historical shrines and old churches around the country, which serve as tourist attractions. “The Philippines is an ideal destination of religious pilgrimage, not only for sight-seeing but to actually experience time-honored Filipino traditions dating back to pre-Spanish era, and then the Christianization period,” DoT Secretary Wanda Corazon Tulfo-Teo said in a statement after attending the Sinulog Festival in Cebu over the weekend. Ms. Teo said the proposed project will be part of the preparations for the 500th anniversary of the arrival of Ferdinand Magellan in Cebu, marking the introduction of Christianity in the Philippines, in 2021.

The place of the regional in contemporary Philippine art

FILIPINO artists play a role in presenting and educating the public about our history and identity.

To support this role, the Philippine Contemporary Art Network (PCAN) was launched on Dec. 8, 2017.

A project of Senator Loren Legarda, it is meant to recognize and hone the skills of artists and curators.

Temporarily based at the University of the Philippines’ Vargas Museum in Diliman, Quezon City, the PCAN’s inaugural project, Place of Region in the Contemporary, focuses on the regions importance in contemporary art.

During an exhibition walkthrough on Jan. 19, PCAN Director Patrick D. Flores explained: “It’s meant to actually harness the resources of Philippine contemporary art. [Of course], we all know that it’s a very active scene. Many artists are doing work, artist collectives are thriving, and the market is strong. The discourse is higher. One of the aims of PCAN is to consolidate and harness the resources of Philippine contemporary art.”

Mr. Flores cited the three nodes around which the inaugural project was built — knowledge production and circulation; exhibition and curatorial analysis; public engagement and artistic formation.

The project delves in research on art history, the historical context of contemporary art, and locating its roots and trajectories, as well as various sources of its emergence.

“There are many ways to define when the contemporary begins and when the modern ends — that is a debate among art historians. But one way to do it is locate some turning points at which expressive practice tried to question certain conventions or institutions of modernism itself,” Mr. Flores said.

The regional artists highlighted in the exhibit are Jess Ayco from Bacolod (1916-1982), Santiago Bose from Baguio (1949-2002), Abdulmari Imao from Sulu (1936-2014), and Junyee from Los Baños, Laguna (b. 1942).

Mr. Flores pointed out that the artists worked in a variety of mediums. Imao was a photographer, sculptor, and painter; Ayco was a photographer, painter, and theatrical production costume designer; Bose was a mixed-media artist; and Junyee is a sculptor and installation artist.

The artists were chosen based in their national prominence and the level of density produced in their body of work. Santiago Bose, founder of the Baguio Arts Guild, included Cordillera culture in his works; National Artist of the Philippines for Sculpture Abdulmari Imao reflected Islamic culture; Jess Ayco went against the masculine framework of modernism; and Junyee brings the state of nature and environmental issues to light with his installations.

“The main argument here is geopoetic — meaning the place (where the artists are from) produces a particular form. The form eventually casts a certain expression for the place,” Mr. Flores said. “The place also forms a subjectivity, but the subjectivity has a life of its own.”

PCAN’s Place of Region in the Contemporary can be viewed Tuesdays to Saturdays, 9 a.m. to 5 p.m., until Jan. 27. For details, call Vargas Museum at 981-8500 loc. 4024, 928-1925, e-mail vargasmuseum@gmail.com, or visit vargasmuseum.upd.edu.ph. — Michelle Anne P. Soliman

ONE, Global Citizen partner against extreme poverty

HAVING established itself as the largest sports media property in Asia, ONE Championship furthers its game, joining forces with international advocacy organization Global Citizen in the latter’s mission to end extreme poverty across the world in 10 years or so.

Officially unveiled during the press conference for ONE’s latest Manila live event — “Global Superheroes” — on Monday at the City of Dreams Manila, officials of both ONE and Global Citizen hailed the newly forged partnership, underscoring the commonalities they have as organizations and harnessing their core strengths for a noble and needed cause.

For ONE Chairman and CEO Chatri Sityodtong, the tie-up with Global Citizen was a natural progression, seeing themselves as more than just a mixed martial arts organization.

Part of their thrust in ONE, he said, is celebrating martial arts in its truest sense anchored on the six values of integrity, honor, courage, humility, respect and discipline, while creating “heroes” from their roster of athletes to be of inspiration to a greater number of people and an agent for positive change.

“It is with great excitement that I announce ONE Championship’s partnership with Global Citizen, a nongovernment organization with the goal of ending extreme poverty across the world by the year 2030. Just like Global Citizen, ONE Championship aims to inspire the people of the world to come together to solve some of the world’s biggest challenges. Our athletes embody the spirit of perseverance and many have risen through poverty by way of martial arts,” said Mr. Sityodtong, who was joined in the launch by ONE champions and stars and Global Citizen ambassadors Brandon Vera, Angela Lee and Eduard Folayang.

On the part of Global Citizen, which is headquartered in New York, the recently inked pact to fight poverty with ONE could not have come at a better time.

Noting the extensive reach of the MMA promotion both here in Asia and beyond, it is a great opportunity for Global Citizen to take their cause to more people.

“ONE Championship reaches millions of young people around the region and together we will engage them on issues that impact the entire world. Since we launched Global Citizen in 2012, over 13 million actions have been taken, and we are excited to drive more actions and increase our impact for the world’s most marginalized people through this partnership,” said Global Citizen cofounder Wei Soo, who also graced the partnership launch.

He went on to say that actions taken were in various forms, including e-mails, tweets, petition signatures and phone calls, and all geared towards creating awareness and measures to fight poverty globally.

As part of their partnership initially, Global Citizen and ONE are to collaborate across 24 live ONE events scheduled in 2018, including four here in Manila, and various outreach activations across Asia.

Through these activities, proponents said fans will get the chance to do their part in specific policy areas like education, food security, hunger and nutrition, global health, gender equality and empowerment.

ONE Championship’s Global Superheroes happens on Friday, Jan. 26, at the Mall of Asia Arena which will feature the rematch between flyweights Geje “Gravity” Eustaquio of the Philippines and former champion Kairat Akhmetov of Kazakhstan. — Michael Angelo S. Murillo

Futuristic technologies star in Detroit auto show

FOR the technology phobic, the Einride T-Pod autonomous cargo truck could be the stuff of nightmares. It is an imposing sight, lacking a traditional driver’s cab, and looks like it might have been dreamed up by a sci-fi filmmaker.

The electric truck was one of many high-tech innovations on display at the North American International Auto Show — or simply the Detroit auto show; ongoing until Jan. 28 — where the top industry players are showing off their latest models and are considering the future of automobiles and transportation.

A spokesman for Swedish company Einride said it will test the T-Pod on its native country’s roads later this year.

The promise of an autonomous future is a dominant theme for industry insiders, and many tech companies participating in the auto show focused on how to improve self-driving vehicles.

Nearby, steering systems manufacturer Nexteer boasted that it can make a steering wheel that does not need to be physically attached to the actual wheels of a car in order to turn them. That lack of a direct connection allows the steering wheel to be a lot more maneuverable.

“We can have a ‘stowable’ column, so the steering wheel actually stows into the dash,” said Dave Sabol, an engineer with Nexteer.

This will be key for autonomous driving, he added, because future cars can hide the steering wheel when the driver is not in charge.

An Ohio firm offered access to data from its expansive road testing facility at a barely-populated outpost outside Columbus.

Chief scientist Christoph Mertz said he can create a database of regularly updated road conditions, so that robot cars of the future can use the information to quickly adapt to their environment.

“At the moment we are in the place where [data] is growing exponentially,” Mertz said.

Meanwhile, Sheikh Shuvo is offering to “clean” data that already exists to teach self-driving vehicles perform better and learn how to drive more like humans.

“That refining process is labeling the data, showing the car what a pedestrian looks like, what a pedestrian does, so that it can better predict different behaviors,” Mr. Shuvo said.

Despite all of the promise, though, many tech attendees said robots and artificial intelligence are not replacing humans any time soon.

Even that autonomous cargo truck has its limitations.

The T-Pod carries about half as much as a typical human-driven truck and is best for distances no farther than 500 kilometers, the company said. — AFP

Asia fears US tariffs on imported washers, solar cells just the start

SEOUL — South Korea and China protested on Tuesday against US President Donald J. Trump slapping steep import tariffs on washing machines and solar panels in a move that stirred fears in Asia of more protectionist measures coming out of Washington.

For all his rhetoric to win votes, Mr. Trump’s actions on trade during his first year had been less alarming than many outside the country had feared — until now.

“It shows that the US administration, after taking its time, it’s now indeed starting to roll out measures restricting trade with the idea of living up to the promises made during the electoral campaign,” said Louis Kuijs, head of Asia economics at global consultancy Oxford Economics, in Hong Kong.

“This could very well be just one step of many,” said Mr. Kuijs, predicting steel and aluminum imports could be on Washington’s target list.

The United States’ stance has put a cloud over global trade at a time when its revival has fueled hopes for a stronger world economy. But, at least, economists believe the United States will avoid taking measures that could impact US companies global supply chains, particularly for cars and electronics.

The tariffs on washing machines, meantime, have dealt a heavy blow to South Korea’s Samsung Electronics and LG Electronics.

Together they ship between 2.5 million to three million washing machines annually to the United States, with sales of around $1 billion, and they hold a quarter of a US market that has been dominated by Whirlpool and General Electric Co.

South Korea’s trade minister Kim Hyun-chong said the new US tariffs violated World Trade Organization (WTO) rules.

“The United States has opted for measures that put political considerations ahead of international standards,” Mr. Kim told a meeting of industry officials.

“The government will actively respond to the spread of protectionist measures to defend national interests.”

China, the world’s biggest solar panel producer branded the move an “overreaction” that would harm the global trade environment for affected products.

“The US’ decision … is an abuse of trade remedy measures, and China expresses strong dissatisfaction regarding this,” Wang Hejun, the head of the commerce ministry’s Trade Remedy and Investigation Bureau, said in a statement on its microblog.

“China will work with other WTO members to resolutely defend its legitimate interests in response to the erroneous US decision.”

Mexico said it would use legal means to ensure Washington met international obligations, pointing to compensation envisaged under the North American Free Trade Agreement.

India has recently re-opened a US dispute, alleging Washington has failed to comply with a ruling on solar power.

Vietnam has also challenged US anti-dumping measures against exports of fish fillets, according to a WTO filing.

SECURITY AND TRADE LINKED
The decisions in the two “Section 201” safeguard cases for washing machines and solar cells came after the US International Trade Commission (ITC) found that imported products were “a substantial cause of serious injury to domestic manufacturers.”

The tariffs on washing machines exceeded the harshest recommendations from ITC members, while the solar tariffs were lower than domestic producers had hoped for.

Mr. Trump ignored a recommendation from the ITC to exclude South Korean-produced washing machines from LG from the tariffs.

Washington will impose a 20% tariff on the first 1.2 million imported large residential washers in the first year, and a 50% tariff on additional imports. The tariffs decline to 16% and 40% respectively in the third year.

A 30% tariff will be imposed on imported solar cells and modules in the first year, with the tariffs declining to 15% by the fourth year. The tariff allows 2.5 gigawatts of unassembled solar cells to be imported tariff-free in each year.

“After a year’s preparation, Trump is ready to take action to address the huge trade deficit with China and get even,” said Zhang Yi, chief economist at Capital Securities in Beijing.

“Last year, we thought nothing would happen, but now China should not have any illusion about it. If the US is using Section 201 to hit you, they will hit hard,” Mr. Zhang added.

Some analysts in Seoul believed Mr. Trump was intensifying pressure on its Asian ally to rely more on him when dealing with North Korea, while gaining leverage renegotiating a bilateral free trade pact that Mr. Trump has previously labeled as “horrible.”

“Security and trade are linked to each other under Trump,” said Choi Won-mog, an international trade law expert at Ewha University.

A filing published by the WTO on Jan. 12 showed Seoul had already asked for authorization to impose annual trade sanctions worth at least $711 million on the United States, in response to the dispute over washing machines.

South Korea also asked for permission to impose an open-ended amount of trade sanctions if Washington broke the same rules again with regard to other products.

Seoul has already demanded compensation because the United States had failed to meet a Dec. 26 deadline to comply with a ruling against duties of up to 82% it had earlier imposed on appliances made by Samsung Electronics, LG Electronics and Daewoo Electronics.

Both Samsung Electronics and LG Electronics expressed concern over US tariffs, saying they would hurt American consumers and jobs.

LG Electronics shares ended up 0.5% after an earlier plunge, while Samsung Electronics was up 1.9% in line with the South Korean market’s 1.4% gain. — Reuters

Challenges ahead of the TRAIN

The paradox of the country’s tax system is not lost among our government officials. After all, the main catalyst behind the tax reform program was the need to overhaul the current tax system and make it simpler, fairer, and more efficient. Despite having one of the highest tax rates in the region, the Philippines fares poorly in its revenue collection efficiency. The country’s value-added tax (VAT), for instance, is at 12%, compared to 10% in Indonesia and Vietnam, 7% in Thailand, and 6% in Malaysia. While the Philippines has the highest VAT rate, it also has the most number of exemptions and zero-rated transactions, which explains its low VAT effort.

With regard to Personal Income Taxes (PIT), the country has the second highest PIT rate after Thailand’s and Vietnam’s 35%. Indonesia imposes a PIT rate of 30%, Malaysia at 26% and Singapore at 20%.

Corporate Income Taxes (CIT) in the Philippines — the focus of the second package of the tax reform program — is also the highest in ASEAN. The Philippines’ CIT rate is at 30%, but collection efficiency is low at only 12.3%. In contrast, Thailand’s CIT is only 20%, but its collection efficiency stands at 30.5%. The common narrative here is that the tax base is eroded by numerous exclusions.

But the number of exemptions is not the only culprit behind the low revenue collections. The country’s revenue collection agencies regularly miss its targets, indicating the need for serious bureaucratic reforms.

Although the tax administration provisions under the recently enacted Tax Reform for Acceleration and Inclusion (TRAIN) addresses some of the loopholes in our tax system, the government should also work double time in addressing serious tax leaks.

Despite growth in its revenue collections, the Bureau of Internal Revenue (BIR) fell short of its P1.68-trillion target by around P59 billion, collecting P1.62 trillion for the first 11 months of the year.

The Bureau of Customs (BoC), which is now under the leadership of Isidro Lapeña, has reached record-high collections after the commissioner took office in September. Monthly collections since then have also averaged at P40 billion, a marked improvement from the P35 billion collected monthly before Lapeña’s term. While this is a remarkable improvement, collections have yet to achieve the required monthly target of around P50 billion from September to December to reach the full-year goal of P468 billion.

Imposing new taxes or increasing tax rates is an easier way to fill the revenue gap, while keeping the fiscal deficit in check. The TRAIN levies higher or new taxes on oil, sugar-sweetened beverages, and automobiles to compensate for the income tax cuts.

For these key revenue-generating provisions, the government may have underestimated its inflationary effects on the average consumer.

Last week, the central bank noted that it may have to reassess its inflation forecast to account for wage hike petitions and indirect inflationary effects resulting from TRAIN.

The TRAIN also covers a host of additional taxes, ranging from cosmetic procedures to coal, to compensate for the watered-down provisions of the Department of Finance (DoF) proposal. Most of these provisions were hastily added in the Senate version of the bill, and later, in the bicameral version, without thorough studies and without conducting public consultation for some of these measures. Unfortunately, the revenues generated from these measures may help close the gap but would also add to the administrative burden of our already beleaguered revenue-collecting agencies.

Of course, tax reform is vital to enable the government to adequately finance backlogs in public investments, particularly crucial infrastructure projects. The incremental revenues from the tax reform, estimated to reach P90 billion in 2018, will be used to fund the investment gap. By the government’s estimates, P1.1 trillion, or half of the total investments, is needed for the infrastructure sector until 2022. The next challenge for the government will then be to maximize its improving fiscal space to make the necessary productive investments.

Since Duterte took office, the infrastructure budget has ballooned, with infrastructure spending targeted to reach at least P8.3 trillion or 7.3% of the GDP by 2022. A government official recently declared that 2018 is the rollout year for the flagship projects. Indeed, the P3.8-trillion national budget reflects this priority, with around one-third of the budget allocated to the sector. The Department of Public Works and Highways, tasked to construct and rehabilitate infrastructure projects, also received the highest allocation among all government agencies.

However, larger budget allocations should be matched with faster government spending.

While disbursements have started to pick up pace towards the end of 2017, the Department of Transportation’s disbursement performance is still below the national government agency average.

Moreover, a 2017 study authored by Epictetus Patalinghug — a trustee of Stratbase ADR Institute — published by the Philippine Institute for Development Studies, noted that the government has to address the low efficiency rate of public transport spending and endemic corruption before increasing infrastructure spending. The study also cited systemic issues that the government has yet to remedy, including lack of skills for oversight, in project preparation, and documentation.

With these challenges, and with four more tax packages in the pipeline, the architects of our tax reform program should focus on addressing loopholes, simplifying compliance, and revisiting tax exemptions or privileges that no longer serve their purpose, among other tax administration issues, to cover needed revenues and justify the new taxes — measures that would truly reform the tax system.

 

Weslene Uy is a Senior Economic Research Associate of the Stratbase ADR Institute.

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