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North Korean leader invites South Korea’s Moon to summit

SEOUL/PYEONGCHANG — North Korean leader Kim Jong Un invited South Korean President Moon Jae-in for talks in Pyongyang, South Korean officials said on Saturday, setting the stage for the first meeting of Korean leaders in more than 10 years.

Any meeting would represent a diplomatic coup for Moon, who swept to power last year on a policy of engaging more with the reclusive North and has pushed for a diplomatic solution to the standoff over North Korea’s nuclear and missile program.

The recent detente, anchored by South Korea’s hosting of the Winter Olympic Games that began on Friday, came despite an acceleration in the North’s weapons programs last year and pressure from Seoul’s allies in Washington.

The personal invitation from Kim was delivered verbally by his younger sister, Kim Yo Jong, during talks and a lunch Moon hosted at the presidential Blue House in Seoul.

Kim Jong Un wanted to meet Moon “in the near future” and would like for him to visit North Korea “at his earliest convenience,” his sister told Moon, who had said “let’s create the environment for that to be able to happen,” Blue House spokesman Kim Eui-kyeom told a news briefing.

A Blue House official said Moon “practically accepted” the invitation.

“We would like to see you at an early date in Pyongyang,” Kim Yo Jong told Moon during the lunch, and also delivered her brother’s personal letter that expressed his “desire to improve inter-Korean relations,” the Blue House said.

The prospect of two-way talks between the Koreas, however, may not be welcomed by the United States.

Washington has pursued a strategy of exerting maximum pressure on Pyongyang through tough sanctions and harsh rhetoric, demanding it give up its pursuit of nuclear weapons first for any dialogue to occur.

“This is the strongest action yet by North Korea to drive a wedge between the South and the United States,” said Kim Sung-han, a former South Korean vice-foreign minister and now a professor at Korea University in Seoul. Moon asked the North Korean delegation during Saturday’s meeting to more actively seek dialogue with the United States, saying that “early resumption of dialogue (between the two) is absolutely necessary for developments in the inter-Korean relations as well,” the South said.

It said the two sides held “a comprehensive discussion… on the inter-Korean relations and various issues on the Korean peninsula in an amicable atmosphere,” but did not say whether the North’s weapons program was mentioned.

A visit by Moon to the North would enable the first summit between leaders from the two Koreas since 2007, and would mark only the third inter-Korean summit to take place.

EXTREME PRESSURE
Pyongyang conducted its largest nuclear test last year and in November tested its most advanced intercontinental ballistic missile that experts said has the range to reach anywhere in the United States.

US President Donald Trump and the North Korean leadership traded insults and threats of nuclear war as tensions rose, with Trump repeatedly dismissing the prospect or value of talks with North Korea.

US Vice-President Mike Pence, who had attended the opening ceremony seeking to counter North Korea’s attempt to use the Olympics for propaganda, said the United States, South Korea and Japan were in complete agreement on isolating Pyongyang over its nuclear weapons program.

“There is no daylight between the United States, the Republic of Korea and Japan on the need to continue to isolate North Korea economically and diplomatically until they abandon their nuclear and ballistic missile program,” Pence told reporters on his flight back to the United States.

A senior US official said Pence and Moon, while watching speed skating together on Saturday night, discussed intensifying sanctions. Moon shared details with Pence of his meeting with North Korean leaders, but did not talk about the invitation to talks in Pyongyang.

As part of his push against North Korean propaganda, Pence attended the short track speed skating with Fred Warmbier, the father of an American student who died last year after being imprisoned in North Korea for 17 months. Moon joined Pence in the arena and sat next to him, turned around to greet Warmbier, according to a White House pool report.

Later, Moon watched the joint Korean women’s ice hockey team — the first ever combined team at the Olympics — take on Switzerland, joining Kim Yo Jong and Kim Yong Nam, the North’s nominal head of state, who is also visiting the South for the Games. — Reuters

Olympic Games organizers confirm cyber attack

PYEONGCHANG — PyeongChang Winter Olympics organizers confirmed on Sunday that the Games had fallen victim to a cyber attack during Friday’s opening ceremony, but they refused to reveal the source. The Games’ systems, including the Internet and television services, were affected by the hack two days ago but organizers said it had not compromised any critical part of their operations. Asked if organizers knew who was behind the attack, International Olympic Committee Spokesman Mark Adams said: “I certainly don’t know. But best international practice says that you don’t talk about an attack.” Russia, which has been banned from the Games for doping, said days before the opening ceremony that any allegations linking Russian hackers to attacks on the infrastructure connected to the PyeongChang Olympic Games were unfounded. — Reuters

Hong Kong police probe deadly bus accident

HONG KONG — Hong Kong police said Sunday they were investigating a deadly bus accident that left 19 people dead and scores more injured, with the bus driver arrested for dangerous driving. The double-decker bus overturned Saturday evening near the town of Tai Po in the northern New Territories, flipping onto its side and appearing to smash into a lamppost. Nineteen people were killed and 65 people were injured, some critically, according to local police. “The 30-year-old male bus driver was arrested for dangerous driving causing death and dangerous driving causing grievous bodily harm. He is still being detained for further enquiries,” police said in a statement early Sunday. Most of the injured and some of the dead were on the upper deck of the bus. The driver was suspected of being over the speed limit as he went down a slope and lost control of the vehicle. — AFP

UN rights chief calls on PNG to safeguard refugees

SYDNEY — Papua New Guinea (PNG) is responsible for the human rights of refugees sent to a remote island by Australia, the UN human rights chief has said, as advocates warn the men are living in fear of violence from local residents. Some 600 men were moved out of an Australian-run camp on PNG’s Manus Island in November to three transit centers after a local court ruled the facility was unconstitutional. The men have expressed fears for their safety at the centers, and also accused Australian and PNG authorities of not providing them with adequate health care. In a day-long visit to PNG on Thursday, UN High Commissioner for Human Rights Zeid Ra’ad Al Hussein raised his concerns about the refugees’ plight during meetings with the government. — AFP

Myanmar says soldiers, police face action over deaths

NAYPYIDAW — Action will be taken against 10 members of Myanmar’s security forces in connection with the killing of captured Rohingya Muslims in Rakhine state, a government spokesman said on Sunday. Reuters on Friday published a report laying out events that led up to the killing of 10 Rohingya men in the northern Rakhine village of Inn Din who were buried in a mass grave after being hacked to death or shot by Buddhist neighbors and soldiers. A Myanmar government spokesman, Zaw Htay, said that “action according to the law” would be taken against seven soldiers, three members of the police force and six villagers as part of an army investigation that was initiated before the Reuters report was published. The arrests were “not because of Reuters news. The investigation was being conducted even before Reuters news,” Zaw Htay said, adding that he was unable to specify what action would be taken against the 16 people. On Jan. 10, the military said the 10 Rohingya men belonged to a group of 200 “terrorists” who had attacked security forces. Buddhist villagers attacked some of them with swords and soldiers shot the others dead, the military said, adding that it would take action against those involved. — Reuters

Peso to weaken further on mixed US, Japan data

THE PESO is seen to weaken further this week as the greenback is expected to be supported by slightly upbeat US economic data and possibly weak Japan fourth-quarter economic growth.

On Friday, the local unit closed at P51.48 and traded as low as P51.79 against the dollar, weaker than the P51.31 close on Thursday, due to wider trade deficit recorded in December.

Week on week, the peso finished slightly weaker than its P51.45 close last Feb. 2.

“The dollar might continue to move with an upward bias this week, supported by likely mixed to strong US reports on inflation and retail sales,” Guian Angelo S. Dumalagan, market economist at Land Bank of the Philippines (Landbank), told BusinessWorld in an e-mail.

Mr. Dumalagan said the dollar is seen to strengthen starting Wednesday due to “potentially mixed to upbeat US data on retail sales and inflation,” which will, in turn, weaken the peso.

On Thursday, the National Retail Federation said retail sales will grow 3.8-4.4% this year, faster than the 3.2-3.8% growth projections it gave last year. The faster outlook was boosted by the robust holiday season for retail sales.

The US consumer price index and producer price index, which will be released midweek, are  likewise seen to show a moderate or faster pace.

The data will be supported by upbeat employment data released early this month, as non-farm payrolls grew by 200,000 in January and as average hourly earnings were up 0.3%.

Mr. Dumalagan added that expectations on inflation and retail sales “may support the dollar by lending support to views of another US rate hike in March 2018.”

On Thursday, Kansas City Federal Reserve (Fed) President Esther L. George said the economic growth boosted by the American tax reform, provides pressure on the central bank to “reasonably” hike its interest rates three times this year.

New York Fed President William C. Dudley, meanwhile, said in an interview with Bloomberg TV that there was a potential to hike more than three times in 2018 “if the economy looks stronger as we go through the year.”

Landbank’s market economist also noted that the dollar is expected to get a boost from safe-haven buying as “possibly weaker fourth-quarter GDP (gross domestic product) growth data from Japan may also strengthen the dollar by fuelling demand for safer dollar assets.”

However, a report from Reuters showed that higher factory output in Japan might signal a solid fourth-quarter growth.

On Wednesday, the Japanese trade ministry showed factory output grew 2.7% in December from the previous month, faster than the 1.6% median estimate of the economists as well as the 0.5% gain booked in November.

For this week, Mr. Dumalagan sees the peso moving between P51.25 and P51.85, while Ruben Carlo O. Asuncion, chief economist of UnionBank of the Philippines, gave a slimmer forecast range of P51.40 to P51.70.

“The factors that could reverse the dollar’s forecasted upward bias include weaker-than-expected US reports on retail sales and inflation, stronger-than-expected fourth-quarter GDP report from Japan, and any positive updates on the Duterte administration’s tax reform and infrastructure program,” Mr. Dumalagan said. — Karl Angelo N. Vidal

PHL shares to continue decline on consolidation

By Arra B. Francia, Reporter

LOCAL STOCKS are seen to continue falling in the week ahead before the main index can establish momentum to propel it back to the 9,000 level.

The 30-member Philippine Stock Exchange index (PSEi)plunged 1.63% or 141.39 points to close at 8,503.69 on Friday, tracking the movement of international counterparts which already lost over 2,000 points last week.

On a weekly basis, the local stock barometer fell by 307.06 points, with all sectors posting negative finishes. Foreigners preferred to move their funds out of the country, as net outflows averaged to P940 million, although lower than the P1.35 billion recorded the week before. 

“I will not be surprised if we lose another 200 points [this] week, however, I am also confident that if we do, we will see it hold our major support at 8,300,” Eagle Equities, Inc. Research Head Christopher John Mangun said in a report.

With economic fundamentals still unchanged, Summit Securities, Inc. President Harry G. Liu said the market could rally in the following weeks.

“(The market’s decline) is not caused by any immediate crisis… I expect the market to rally very soon,” Mr. Liu said by phone last Friday.

The Bangko Sentral ng Pilipinas chose to keep rates steady during their first policy meeting last Thursday, although raising its inflation forecast in 2018 to 4.3% in anticipation of price increases mandated under the Tax Reform for Acceleration and Inclusion program.

“Inflation (as a gauge for growth) is good, so long as propelled by improved employment, which should trickle in as more infra projects are rolled out,” online brokerage 2TradeAsia.com said in a weekly market note. 

The brokerage added that liquidity is intact, as companies tap the capital market to raise funds. Included in the lineup of firms set to conduct fund-raising activities in the February to March period are Metropolitan Bank & Trust Co., Bank of the Philippine Islands, Robinsons Land Corp., Integrated Micro-Electronics, Inc., and the Philippine Stock Exchange, Inc. 

“Given this, it is normal to see liquidation considering share prices have breached an attractive zone where cash outs are the usual reaction,” according to 2TradeAsia.com. 

Eagle Equities’ Mr. Mangun also noted that should the market bounce back to the 9,000 level, this trend is called the bear trap. 

“This is beneficial for our market as more of the “weak hands” will be shaken out. A bear trap is a false signal that the rising trend of a stock or index has reversed when it has not.”

2TradeAsia.com placed the market’s immediate support at 8,400 this week, while resistance will play within the 8,600 to 8,650 range. 

How many times did the PSEi hit record high this year?

The Philippine Stock Exchange index (PSEi) soared to record-high levels 14 times for the entire 2017 — the last peak marking that year’s final trading day on Dec. 29 — with analysts citing investors’ unwavering confidence in the Philippines’ solid economic fundamentals. As of Feb. 11 this year, the PSEi had already peaked ten times. The last all-time high was recorded on Jan. 29, when the main index finished at 9,058.62. Partly credited with lifting the PSEi was enactment on Dec. 19 last year of the first tax reform package that forms part of an entire program aimed at making Philippine taxation fairer — by shifting the burden more on those who can afford to pay more — while raking in more revenues. There are three to four more packages in the pipeline that will provide periodic boosts to equities in the months ahead.

Philippines’ stock index’s record high finish by MBG / BusinessWorld

Why the Philippines remains an attractive mining prospect despite unfriendly policies

The Philippines remains a compelling mining prospect despite policies unfriendly to the industry since 2012. Take the case of gold, a prime Philippine metal mineral. The country climbed two places in 2016 in the ranking of the world’s largest gold producing countries, according to the latest GFMS Gold Survey by Thomson Reuters.

The country took the 17th place in the list of top 20 gold producing countries in 2016, up two spots from 19th in the previous year. Gold mine production in the country was also higher with 48.5 tons of gold produced in 2016 compared to 46.7 tons produced in 2015.

RECOMMENDED READMining compelling despite policy hurdles — BMI

Philippines ranks among top gold producing countries by BusinessWorld

 

The economic impact of hosting FIBA World Cup

More than 40 years since hosting the biggest hoops event in the world, basketball is coming home to the Philippines after the country, together with Indonesia and Japan, secured hosting rights for the 2023 FIBA Basketball World Cup.

Hosting FIBA events has economic benefits, which come in the form of events’ impact on the overall economy and return on investment, branding on a global scale (advertising and sponsorship values), revenue opportunities (sale of tickets and local broadcast rights) and auxiliary events’ potential (associated events with economic value).

Exactly how much will the Philippines gain from co-hosting it? Let’s take a look at Spain, which played host to the last FIBA World Championship (now World Cup) in 2014. Here’s how much income the country generated from the sporting event.

2014 FIBA World Cup’s economic impact in Spain by MBG / BusinessWorld

Can the Philippines live without coal?

This is why the Philippines can’t just get over its dependence on coal overnight, environmentalists’ advocacy notwithstanding.

Saving Panay Island’s ‘Big 5’ endangered species

A three-year conservation program that will close this month has shown an increase in the overall population of five endangered species found in Panay Island.

Read the full story.