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Celebrate the holidays at these fine hotels

Hotels are making the Christmas season even more Christmassy with their awesome deals, discounts and treats, some of which are listed below. But hurry up, these festive offerings are for the taking for a limited period of time.

The Peninsula Manila in Makati City is holding a “Pen Days of Christmas” promo. For a minimum of P12,400 per night in a deluxe room, one gets the following additional benefits in return: buffet breakfast for two adults and two children under the age of 12 at the Escolta restaurant; complimentary Peninsula Santa hamper (one per stay); 20% savings off at the hotel’s food and beverage outlets (except at Escolta on Christmas eve); a special Christmas gift (one per stay, to be received either on Christmas eve or Christmas Day); complimentary shuttle service to nearby malls; complimentary use of the hotel’s fitness center, spa facilities and swimming pool; and complimentary Wi-Fi connection and local city phone calls. This promo is valid only until Jan. 10, 2018 (except from Dec. 29 to 31, 2017). Those who will book a suite can avail themselves of a 50% savings on a second room — superior room to grand deluxe room categories.

At the Shangri-La at the Fort, in Bonifacio Global City, booking a holiday staycation can save one as much as 10% on the best available room rate; the price starts at P8,550 per night. Besides the discount, an individual or family staycationing for the holidays are allowed the use of the gym at Kerry Sports Manila and outdoor swimming pools, as well as access to wired and wireless Internet services. The offer is valid from until Jan. 7, 2018, except on Dec. 24 and 31, 2017. Reservations can be made until Jan. 7, too. But if a family happens to be staying at the hotel on Christmas eve, its members cannot miss the delectable five-course dinner, which includes a glass of Imperial Piscine. The dinner is priced at P4,500 net per person. The following morning, on Christmas day, they can avail themselves of a four-course brunch, which costs P3,500 net per person and is going to be prepared by Nathan Griffin, chef de cuisine of the Raging Bull Chophouse & Bar.

Since Dec. 1, Hotel Jen Manila in the capital has started accommodating people who have availed themselves of the hotel’s holiday special offer — a stay at its deluxe room, and its attendant benefits, which include a buffet breakfast for two persons at the Latitude restaurant, a 20% discount on either lunch or dinner at the same restaurant, a complimentary shuttle to SM Mall of Asia (one of the largest shopping centers in Asia) and late check-out, until 3 p.m. The promo will last until Jan. 31, 2018. It will not be in effect on Dec. 31, 2017, though. But one can take advantage of a different but no less exciting promo: Countdown to 2018 at Windows by the Bay. That celebration includes unlimited cocktails and light bites, a glass of sparkling wine for toasting and music from a guest DJ. Registration will start at 10 p.m.

For the holiday season, Marriott Hotel Manila in Pasay City is offering a holiday room package, which starts at P12,888. This includes a nice mix of delights: premium room accommodation at the new West Wing; P3,000-worth of food and beverage credits per night of stay that may be used in any food and beverage outlet (Marriott Café, Cru Steakhouse, Man Ho, in-room dining, Still, Gourmet Express and Great Room); P1,500-worth of Christmas Train credits per night of stay; and a special nightly holiday turndown amenity. It is only valid until December 30, 2017, and one is required to use the promotional code H09 when making an online reservation. There is a special offer for members of Marriott Rewards, which is valid until Dec. 30. For every night of their stay in a deluxe suite at the West Wing of the hotel, they earn 2,000 bonus points. The required promotional code is M12.

Discovery Primea in Makati City is knocking 15% off the best rates for its Business Flats and Business Suites, and 20% off its Executive and Primea Suite throughout the holidays. In addition, guests checking in get to enjoy 20% off all food and beverage consumption, even a complimentary use of the hotel’s handy smartphones during their stay. The offer will last until Jan. 14, 2018, and when booking, use the promo code PXMAS. While staying at Discovery Primea, try the splendid Italian, French and Spanish cuisines at Restaurant Tapenade on Christmas eve, Christmas Day and New Year’s eve. If that is not enough, there is another restaurant at the luxury hotel, FLAME, where the executive chef Luis Chikiamco and his team prepare and serve multi-course meals that are playful, ambitious and sublime. Afterward, one can head to Terazi Spa for a 90-minute relaxing massage, which also entitles guests to a complimentary voucher for a full-body scrub.

Last-minute guide to choosing the best gifts

It’s that time of the year again. Christmas is approaching fast. Whether you celebrate the holiday or not matters little; it’s the season of giving and love. Everyone deserves something special this Christmastime, and what better way to show how much you care about your loved ones than by giving them the perfect gift?

If you still don’t know what to give them, or are still looking, don’t fret! It’s not too late. Ditch the picture frames and mugs, because we’ve made a list of gift ideas perfect for your loved ones, friends, and colleagues, regardless of their personalities.

For anyone: Books

Take a trip to any major bookstore and you can almost always find something that someone will be interested in. Do you have any friends who are into photography? Why not get them a manual that can help them take better shots, or even a book filled with the work of their favorite photographer?

If you have any religious relatives, you can head over to the Religion section and buy them a copy of Pope John Paul’s biography, or even a simple Christian devotional like Our Daily Bread. Otherwise, you can just look up the Fiction best-sellers, pick one and giftwrap it for your Christmas party.

Better yet, order your books online. Most major bookstores in the Philippines now offer delivery services on their Web sites for maximum convenience.

For office workers: A cotton or fleece jacket

For Filipinos who have lived and grown up in the Philippines, where temperatures can reach up to a blistering 36 degrees centigrade, it can be quite an unnecessary expense to buy a thick jacket for warmth. It used to be simply way too hot to be of any use anywhere outside Baguio.

But with the continuing rise of the business process outsourcing industry, more and more Filipinos have the opportunity to work in airconditioned offices, where more often than not the temperatures can get more than a little freezing. Most offices don’t allow the thermostat to be touched at all, making it imperative to have something to keep you warm. Your officemates can do far worse than have a new jacket to let them be more comfortable at work.

For everyone: Umbrellas

The hot climate is only half of the experience of living in the Philippines. The other half involves the difficult, often brutal, rainy season. Anyone who has lived in the country for more than a year can agree that commuting under the pounding rain and buffeting winds is a miserable experience. One cannot have too many umbrellas here. Most people would benefit from having spare umbrellas at home for the possibility of theirs getting lost, broken, or stolen.

For people you don’t know that well: Socks

Boring? Maybe. Useful? Definitely. Socks are often ridiculed and stigmatized as being an unattractive, disappointing gift, but no one can deny their significance to daily life. A good pair of socks can last years if well taken care of (there’s very little chance for any adult to outgrow them), and a really comfortable pair can provide a huge improvement to quality of life. They can come in various designs and colors as well, giving a layer of customizability and personality to the wearer.

Will it make your Secret Santa excited and awed? Maybe not. Should you give socks as a gift for the holiday? If you seriously don’t have an idea what to give as a gift, why not? They’re way better than picture frames.

For travelers: A passport bag

Your passport is the single most important object you bring with you when you go abroad. It serves as your identification, and your way back home. Losing a passport in a foreign nation is a heap of trouble that no one deserves to go through.

A passport bag, a wearable one preferably, can do a lot to ease the stresses of traveling. As long as you keep the bag on your person, you never need to worry about losing anything valuable. The only caveat to giving this as a gift is that your recipient may already have one. Be sure to check before buying.

For the ambitious: Colognes or perfumes

Among the list of things that can improve your standing as a professional is how you look and carry yourself. Hygiene, clothes, and confidence can make all the difference between getting a boost in your career, or getting stuck at a dead-end. How you smell can play a part in that. While you can’t really give away confidence or good hygiene, you can provide your friends and loved ones a subtle improvement to their self-image.

For friends and family who tell you they don’t want anything: Time

Through the shopping rush and mad scramble for gifts, there are those who acknowledge the stress and difficulties of the season. They are the ones who insist they don’t need nor want anything, and would much rather stay at home rather than join the throngs of people celebrating the holidays at the mall. These types of people are perhaps the most challenging ones to find a gift for, so it’s probably best to stop trying to look for one.

Rather, just spend time with them. Talk with them, make them feel appreciated, and celebrate the holiday discovering the true meaning of the season. Plus it’s free. — Bjorn Biel M. Beltran

Attack of the Nerds

By Joseph L. Garcia

I hid the best way I thought I could, but the bright lights on my black clothing betrayed my location. A girl on my side had been shot in the face, and she raised her hands in surrender. Taking a deep breath, I jumped up from my hiding place and shot, and shot, and shot — one bullet after another. A bullet from another marksman explodes on contact on my chest, and I knew it. In my short life, I felt a blaze of joy and exhilaration from the knowledge that I fought for something, but now I was dead. Which meant I had to raise my hands, jog out of the arena, and come back to life, unscathed: ready for another round. This was one of the games offered in Attack Arena, a large building in Quezon City that serves as a combat gym of sorts. There’s the shooting activity I enjoyed — no real bullets, they’re all made of gel; Forge Martial Fitness, an activity teaching the principles of medieval swordplay; and Archery Attack (a concept imported as a franchise from Australia), characterized by realistic archery fights — no forms and bull’s-eye targets here, your target is your moving opponent.

Foam-tipped arrows whizzed around to the tune of epic battle music (Think the “Duel of the Fates” from Star Wars) as BusinessWorld interviewed Ralph Lao, general manager of Attack Arena.

“The people who play here are nerds! They’re geeks and nerds!” declared Mr. Lao. He was good-looking, but yes, he wore glasses, and had an enthusiasm that was just so… uncool.

It wasn’t always easy to be a geek (geeks are experts at obscure areas of knowledge; nerds are academic intellectuals — both worlds may intersect). Before the culture was glamorized by shows such as The IT Crowd and The Big Bang Theory, it was characterized by loneliness, knowing that for miles around, you were the only one who cared about, oh, The Lord of The Rings, or Star Trek, or comics. While the winners of the genetic lottery, the popular kids, talked about sports, and cars, and parties, geek boys and girls had to content themselves with small, secret gatherings where they discussed their favorite shows or played Dungeons and Dragons. Of course, it’s different now: the popular kids are now well-aware of who the X-Men are, and it’s the geeks who have unbelievable powers in the highest bounds of industry.

Mr. Lao sat at the side of the arena as he watched a group of kids duke it out in the arena, while another one in glasses admired a shield. “Most of them that start out are not very athletic people,” he noted. “It’s kind of like video games, but you really get to do it in real life.”

Mr. Lao discussed what his arena is all about: “Really having fun interactions, and really having fun in a physical way. Away from digital play.

“I become a space, literally, for them to hang out, to have fun,” he said. “I really had plans to develop new recreational activities to bring people together.”

Gyms can be unfriendly, and the rigorous, controlled workouts are a bit of a block to the wide creative worlds living inside the mind of the geek. “Pain is always a hindrance to making new friends. But pain — we make it here as a way to make friends.”

Movies may make the stereotype that geeks are often separated and ostracized from the rest of the crowd. What this ignores is that geek-dom is still a form of social organization, and organizations are marked by collecting those who are similar, and excluding those who are different. The tables have turned, and with the mainstreaming of geek culture, geeks now own the popular table. “We don’t want the asshole, the die-hards to be part of the community early on. It creates a bad image for everyone,” said Mr. Lao, discussing die-hard geeks and nerds who would exclude people from groups for a lack of knowledge on a certain subject, or for not adhering to certain codes of conduct.

SWORD PLAY
Ijohn Kaw, the arena’s weapons dealer (foam swords and toy guns), owns two stores at UP Town Center and Ayala Malls The 30th that are just filled with geek toys, like swords used by anime and movies characters. His clients, he says, are mostly dads, and not their kids.

“My passion was video games,” he said — maybe that marks him as a geek too. “Glee,” he said, when asked how he felt when he holds in his hands a weapon from Lord of The Rings or some anime. He told me he had something that would knock my socks off: and he presented me with a sword used by She-Ra, He-Man’s sister. The glee I expressed marks me now as one of them. “People get a high seeing their [favorite] items brought to life,” he said.

A student at Forge Martial Fitness, the swordplay classes in Attack Arena, showed up to an interview with BusinessWorld carrying his sword. Marc Ferdinand Castaneda showed up wearing glasses, unstyled hair rising up in spikes, a brush of facial hair, and a reasonably firm physique because of his swordfighting activities. Asked when and why he carries his sword, he said he didn’t carry it on most days: just usual days. “When I’m just walking around, and just thinking.”

He owns two swords, a metal one that he had forged, weighing about 2.8 lbs, and a plastic sword at about 2 lbs., which he bought in, of all places, Cash and Carry.

Mr. Castaneda is training under the straightforward and efficient German school of longsword, as opposed to, for example, the more florid Italian style. “It’s more like a fantasy for me, really. I’ve always had this fascination for knights, for the Medieval times.”

His first brushes with Medieval fantasy include of course, the legends of King Arthur in Camelot, and the movie Robin Hood: Men in Tights.

While his current training benefits him physically with the goal of improving his arms, legs, core, and extending his endurance, he speaks about the emotional benefits of his training. “I’m an overthinker. I tend to think too much,” he said. To him, logic must rule over all his decisions.

“There are always things that will be beyond logic,” said Mr. Castaneda, a writer for a media network. “They won’t always make sense, but they feel right. The level of swordplay allows me to tap into this: a more primal way of thinking, that isn’t necessarily thinking.”

“Emotionally, it’s a release. It releases a lot of pent-up stress, anxiety: because it focuses on you and something else instead of your problems,” said Mr. Lao about the activities his arena offers. “It’s bridging the gap from where it’s not cool to dress up or play-act characters from your fantasies.”

Q3 FDI pledges end 4 quarters of decline

By Arianne Kristel R. Pelagio

FOREIGN direct investment (FDI) commitments rose in the third quarter, partially recovering from four straight quarters of decline.

Preliminary Philippine Statistics Authority (PSA) data show that approved FDI pledges — which are commitments until capital actually flows in — registered with the country’s seven investment promotion agencies (IPAs) grew 61.1% year-on-year to P43.018 billion in the third quarter from P26.711 billion a year ago.

Combined investment pledges by both foreigners and Filipino nationals totalled P274.368 billion, 105.1% more than the year-ago’s P133.787 billion.

IPAs are government agencies that by law are authorized to grant tax and non-tax incentives to investors putting up businesses or expanding existing ones in priority sectors. The seven IPAs are the Board of Investments (BoI), Clark Development Corp. (CDC), Philippine Economic Zone Authority (PEZA), Subic Bay Metropolitan Authority (SBMA), Authority of the Freeport Area of Bataan (AFAB), BoI-Autonomous Region in Muslim Mindanao (BoI-ARMM) and Cagayan Economic Zone Authority (CEZA).

The three months to September saw PEZA contributing the most to FDI pledges at 79.2% with P34.052 billion, up fivefold from last year’s P6.374 billion.

This is followed by the BoI with a 16.3% share at P7.014 billion, though 64.4% less than a year ago.

Rounding the rest of the IPAs were CDC’s P1.064 billion with a 2.5% share, BoI-ARMM’s P690 million (1.6% share), AFAB’s P142.194 million (0.3%), SBMA’s P51.138 million (0.1%) and CEZA’s P4.95 million (0.01%).

Foreign investment pledges from CDC and AFAB in the third quarter saw significant increases from their 2016 figures of P79.418 million and P7.004 million, respectively.

On the other hand, foreign investment commitments to SBMA and CEZA were both down 90.4% and 77.9% year-on-year, while previous data from BoI-ARMM were not available.

Actual net FDI inflows in the third quarter — tracked separately by the central bank — climbed 35.8% year-on-year to $2.264 billion from $1.667 billion. That brought nine-month net FDI inflows to $5.839 billion, still down 0.2% from the past year.

Economists attribute the investment inflows to the country’s bright overall economic prospects.

“The latest foreign investments report provides evidence of investors’ continued confidence in the Philippines’ growth story, which is primarily fueled by the country’s growing middle class and young population,” said Guian Angelo S. Dumalagan, market economist at the Land Bank of the Philippines (Landbank).

This view is shared by Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines (UnionBank), who said that the factor for this surge “has always been the strength, resiliency and robustness of Philippine economic growth in the last decade or more.”

“Note that there is a momentum that is building up in favor of increasing infrastructure spending and important structural reforms that support investment growth through sustained and increasing government spending, particularly on infrastructure, education, and other social services,” he said.

By industry, manufacturing continued to make up bulk of the foreign investment pledges with a 58.2% share of the total at P25.053 billion, 395% higher than the past year’s P5.061 billion. Real estate activities followed with a 23.5% share or P10.097 billion while administrative and support service activities came third with 6.7% or P2.861 billion, a 25.9% increase from P2.273 billion a year ago.

Meanwhile, investment pledges in information and communication technology was P1.186 billion, 356.3% more than P259.9 million previously.

The other industries with foreign investment pledges during the quarter were, in order of magnitude: electricity, gas, steam and air conditioning supply; accommodation and food service activities; construction; wholesale and retail trade, repair of motor vehicles and motorcycles; financial and insurance activities; agriculture, forestry and fishing; transportation and storage; arts, entertainment and recreation; professional, scientific and technical activities; other service activities; and education.

Japan was the biggest source of investment commitments in the third quarter with P21.374 billion, increasing 784.2% year-on-year and accounting for 49.7% of the total for that period. It was followed by Taiwan and Australia, pledging P8.852 billion (20.6% share) and P2.763 billion (6.4% share).

CALABARZON — the region immediately south of Metro Manila that consists of Cavite, Laguna, Batangas, Rizal and Quezon — got the most FDI commitments in the third quarter at 50.4% of the total at P21.699 billion. This was 691.9% bigger than the amounts recorded in 2016’s comparable three months. “The fact that majority of foreign investments are focused in CALABARZON is a positive sign, as it suggests that growth is branching outside of the National Capital Region — a trend which is supportive of inclusive growth,” Landbank’s Mr. Dumalagan noted.

Economists remained positive on foreign investment commitments in the months ahead.

UnionBank’s Mr. Asuncion said he expects “year-end level for FDI” pledges to exceed last year’s total. “The Philippines has been at the top of mind of various sophisticated investors. In the first half of the year, investment inflows were rather soft, but I still expect 2017 to top the investment level last year,” he said.

For Landbank’s Mr. Dumalagan: “Moving forward, foreign investments might remain strong, especially if the government is able to roll out its ambitious infrastructure projects, which are expected to improve the country’s productive capacity and consumer spending.”

Q3 FDI pledges end 4 quarters of decline

Star Wars: The Last Jedi mostly finds its force with critics

LOS ANGELES — Star Wars: The Last Jedi won warm reviews from most critics on Tuesday, a day before the latest installment in the sci-fi saga began hitting movie theaters worldwide in what is projected to be the biggest-grossing movie of 2017.

The Walt Disney Co. movie received four or five stars from most reviewers, along with praise for its energy and emotion. The Last Jedi scored a 94% “fresh” rating on aggregator site RottenTomatoes.com.

The film, arriving in movie theaters from Dec. 13, picks up from 2015’s Star Wars: The Force Awakens, which took in more than $2 billion at the global box office to become the third-biggest-grossing movie of all time.

Written and directed by Rian Johnson, The Last Jedi kicks off with the Resistance fighting Supreme Leader Snoke’s First Order, which is trying to take control of the galaxy.

The movie features the final appearance of Carrie Fisher, who plays the franchise’s Princess Leia. The actress died at age 60 last December, weeks after completing filming.

Numerous critics including The Hollywood Reporter felt that at 2-1/2 hours, the movie’s run time was a little too long. But the Hollywood Reporter added, “there’s a pervasive freshness and enthusiasm to Johnson’s approach that keeps the film, and with it the franchise, alive, and that is no doubt what matters most.”

The London Times newspaper deemed it the best Star Wars movie yet, calling it a “film of wit and wonder, of eye-gouging visual spectacle, and one that is buttressed by entirely unexpected, and frequently devastating, emotional power.”

Entertainment Weekly said The Last Jedi was a “triumph with flaws,” while USA Today said it was “a stellar entry” in the Star Wars franchise.

The Washington Post praised the film’s “irreverent humor and worshipful love for the original text.”

Variety was among a handful of less enthusiastic reviews, calling the film “ultimately a disappointment.” CNN said Last Jedi felt “like a significant letdown, one that does far less than its predecessor to stoke enthusiasm for the next leg in the trilogy.”

Before the reviews were out, Boxoffice.com projected that Last Jedi would haul in $185 million to $215 million in North America in its first weekend, which would rank as one of the biggest film debuts in history.

Disney said in November that Johnson will oversee a new trilogy of Star Wars films that will not follow the Skywalker saga, which George Lucas kicked off in 1977. — Reuters

BSP steadies policy until at least Feb., maintains inflation forecasts

By Melissa Luz T. Lopez
Senior Reporter

THE BANGKO SENTRAL ng Pilipinas (BSP) held fire on monetary policy yesterday as inflation remains within target and with economic growth remaining upbeat, which came despite a fresh rate hike in the United States that would trigger rising global yields.

As expected, the Monetary Board kept borrowing rates unchanged during its eighth and final policy review for 2017.

Rates stayed at 3.5% for the overnight lending rate, 3.0% for the overnight reverse repurchase rate, and 2.5% for overnight deposit.

The BSP will hold its next monetary policy review on Feb. 8, 2018.

The central bank last hiked key rates in September 2014, although procedural cuts were introduced in June 2016 for the shift to an interest rate corridor scheme.

“The Monetary Board’s decision is based on its assessment that the outlook for the inflation environment has been broadly unchanged,” BSP Governor Nestor A. Espenilla, Jr. said in a statement, adding that domestic economic activity has remained firm.

Inflation averaged 3.2% in the 11 months to November, with last month’s 3.3% pace reflecting the first slowdown in five months.

The 11-month average also settled within the 2-4% target range set by the central bank and matches the BSP’s forecast for 2017.

The BSP’s decision followed a third rate increase for 2017 introduced by the US Federal Reserve during its two-day review ending Wednesday that has long been factored in by markets amid the US’ slow but steady economic recovery. US monetary policy makers increased rates by another 25 basis points at the end of their Dec. 12-13 review. Fed officials also maintained their estimate of three more interest rate increases in 2018 and 2019.

Central bank officials have said that they need not move in sync with the Fed, as they focus more on domestic developments in setting interest rates.

“[T]here’s hardly any need to tighten monetary policy. We are saying this because the so-called overheating concerns due to high credit growth is at least misplaced. The economy continues to grow and an economy that is growing needs robust provision of domestic credit,” BSP Deputy Governor Diwa C. Guinigundo said in a briefing yesterday.

The BSP also kept the 20% reserve requirement ratio (RRR) on Thursday, but pointed out that it remains to be a “medium-term commitment” of the monetary authority.

“Until such time we are prepared to ease monetary policy and if the capital markets are sufficiently developed… that should usher in the proper environment for considering the possible reduction in the reserve requirement,” Mr. Guinigundo said.

Economists tapped in a BusinessWorld poll said an RRR cut may be introduced next year.

UBS economist Alice Fulwood said in a conference call yesterday that the BSP will likely hike policy rates three times in the second semester of 2018, in order to apply the brakes on inflation.

Capital Economics said the BSP may have room to keep rate adjustments on hold even all through 2018, and dismissed fears about double-digit bank lending growth as this merely supports additional production activities.

“[W]e believe next year will be more momentous,” HSBC Global Research said separately, noting that “market demand for liquidity continued to lift TDF (term deposit facility) rates and inflationary risks for 2018 are tilted to the upside.”

“We expect a 100bp cut to the RRR in 1Q18 to inject liquidity and fulfill policy objectives, and a 25bp policy rate hike in 2Q to limit inflationary risks,” HSBC Global Research economist Noelan Arbis said in a note.

“We do agree with the BSP that overheating concerns are misplaced, which is why we do not expect another rate hike until 3Q19 if one were to happen in 2Q18.”

INFLATION STEADY
The BSP also maintained inflation forecasts until 2019, even as overall price hikes are likely to pick up amid rising oil costs and the tax reform program that will be implemented starting January.

The BSP kept its annual inflation estimates at 3.2% this year, 3.4% next year and 3.2% in 2019.

Mr. Guinigundo said oil prices of up to $65 per barrel “would not be enough to upset” inflation to go beyond four percent.

Higher levies from the tax reform program that Congress ratified last Wednesday are also expected to prod price hikes further, even as the impact should be “transitory.” Resulting added revenues will spur economic output by supporting infrastructure projects.

Fed raises interest rates, leaves outlook unchanged

WASHINGTON — The Federal Reserve raised interest rates on Wednesday but left its rate outlook for the coming years unchanged even as policy makers projected a short-term jump in US economic growth from the Trump administration’s proposed tax cuts.

In an early verdict on the tax overhaul, Fed policy makers judged it would boost the economy next year but leave no lasting impact, with the long-run potential growth rate stalled at 1.8%. The White House has frequently said its tax plan would produce annual GDP growth of 3-4%.

The expected fiscal stimulus, coming on the heels of relatively bullish data, cleared the way for the US central bank to raise rates by a quarter of a percentage point to a range of 1.25% to 1.50%. It was the third rate hike this year.

But the Fed’s forecast of three additional rate increases in 2018 and 2019 was unchanged from its projections in September, a sign the tax legislation moving through Congress would have a modest, possibly fleeting, effect.

The rate increase represented a victory for a central bank that has struggled at times to deliver on its promised pace of monetary tightening. It also allowed Fed Chair Janet Yellen, at her final press conference before her term ends in February, to signal an all-clear for the US economy a decade after the onset of the 2007-2009 recession. “At the moment, the US economy is performing well. The growth that we’re seeing, it’s not based on, for example, an unsustainable buildup of debt… The global economy is doing well, we’re in a synchronized expansion,” Ms. Yellen said. — Reuters

“There is less to lose sleep about now than has been true for quite some time, so I feel good about the economic outlook.”

But the central bank’s projections also contained some potential dilemmas for incoming Fed chief Jerome Powell.

The Fed now envisions a burst of growth, ultra-low unemployment of below four percent in 2018 and 2019 and continued low interest rates — yet little movement on inflation. Ms. Yellen said the persistent shortfall of inflation from the Fed’s two percent goal was the major piece of “undone work” she was leaving for Mr. Powell to figure out.

In its justification for Wednesday’s rate increase, which was widely expected by financial markets, the Fed’s policy-setting committee cited “solid” economic growth and job gains.

US stocks extended gains after the release of the policy statement before ending mixed, while Treasury yields dropped. The dollar fell against a basket of currencies.

Traders of US short-term interest rate futures kept bets the Fed would raise rates only twice next year.

The Fed now sees gross domestic product growing 2.5% in 2018, up from the 2.1% forecast in September. The pace of growth is expected to cool to 2.1% in 2019, slightly higher than the prior forecast of 2.0%.

“Changes in tax policy will likely provide some lift to economic activity in coming years,” Ms. Yellen said, adding that “the magnitude and timing of the macroeconomic effects of any tax package remain uncertain.”

The impact would “mainly” work to raise aggregate demand as households and companies have more money to spend, Ms. Yellen said, with “some potential” to raise investment and the economy’s longer-term growth.

The Fed also said on Wednesday it expected the nation’s unemployment rate would fall to 3.9% next year and remain at that level in 2019, well below what is considered to be full employment.

It previously had forecast a jobless rate of 4.1% for those two years.

But inflation is projected to remain shy of the central bank’s goal for another year, with weakness on that front still enough of a concern that policy makers saw no reason to accelerate the expected pace of rate increases.

“It shows at least some members of the Fed don’t see any reason to keep hiking rates in an environment where the economy is growing more strongly but certainly not overheating and where inflation hasn’t become a problem and doesn’t look like it is going to be one,” said Kate Warne, investment strategist at Edward Jones.

Policy makers do see the federal funds rate rising to 3.1% in 2020, slightly above the 2.8% “neutral” rate they expect to maintain in the long run. That indicates possible concerns about a rise in inflation pressures over time Chicago Fed President Charles Evans and Minneapolis Fed President Neel Kashkari dissented in the policy statement on Wednesday. — Reuters

GMR-Megawide submits lowest offer to upgrade Clark airport

By Patrizia Paola C. Marcelo,
Reporter

THE consortium of Megawide Construction Corp. and Bangalore-based GMR Infrastructure Ltd. has submitted the lowest-cost offer to upgrade the Clark International Airport (CIA), according to the Bases Conversion and Development Authority (BCDA).

The BCDA opened on Thursday the financial bids for the Clark International Airport (CIA) Phase I terminal upgrade, showing the GMR-Megawide consortium submitted the lowest offer at P9.36 billion. This was 25% lower than government’s set ceiling of P12.5 billion for the new airport terminal building.

“They (GMR-Megawide) are the lowest rated bid right now, but we are going to make sure they are responsive as well,” Joshua M. Bingcang, BCDA vice-president and chairman of the Special Bids and Awards Committee (SBAC), told reporters.

Sinohydro Corp. made the second lowest bid at P10.68 billion, followed by China Harbour Engineering Company Ltd. (P11.73 billion), China State Construction Engineering Corp. Ltd. (P12.3 billion), and the consortium of Tokwing Construction Corp. and China Machinery Engineering Corp. (P12.5 billion).

Only Megawide and Tokwing are the Philippine-based companies involved in the bidding.

The BCDA said the SBAC will do post-qualification evaluation and will award the contract on Dec. 18. Groundbreaking for the Clark project is scheduled on Dec. 20.

Mr. Bingcang said the SBAC will communicate with GMR-Megawide consortium’s clients to get feedback on past projects, as well as its banks to verify its funding capabilities.

If the GMR-Megawide consortium fails to meet the post-evaluation qualifications, the BCDA will then consider Sinohydro’s bid.

In 2014, the GMR-Megawide consortium won the contract for the P17.52-billion Mactan-Cebu International Airport (MCIA) Passenger Terminal Building project under the Aquino administration’s flagship public-private partnership (PPP) program and the concession to develop MCIA for a period of 25 years.

In June this year, the GMR-Megawide consortium submitted a P208-billion unsolicited proposal for the 50-year long-term development of MCIA.

Megawide is also awaiting approval of the East-West Railway Project. It announced in July that it acquired a stake in the consortium composed of East-West Rail Transit Corporation and Alloy MTD, giving it the right to participate in the Philippine National Railways’ (PNR) rail project.

Megawide is also the private partner for the Southwest Integrated Terminal Exchange (SWITX) an intermodal transport terminal intended to provide connectivity for commuters in the southern parts of Metro Manila.

Other PPP projects awarded to Megawide include the modernization of Philippine Orthopedic Center together with World Citi, and the school infrastructure project phase I and II.

Fitch upgrades lenders’ ratings

FITCH RATINGS raised its scores for government-owned Land Bank of the Philippines (Landbank) and Development Bank of the Philippines (DBP) to investment grade following its move to upgrade the sovereign’s rating earlier this week.

The long-term issuer default ratings (IDRs) of Landbank and DBP were upgraded by a notch to “BBB-,” the minimum investment grade from the previous “BB+”, with a “stable” outlook.

In a statement on Thursday, Fitch said the IDR upgrades of Landbank and DBP were driven by expectations of “an improving sovereign fiscal profile,” which led to the upgrade of the banks’ support rating floors (SRFs) as well.

Last Monday, the global debt watcher raised the Philippines’ IDR to “BBB” with a “stable” outlook. This is a notch above the minimum investment grade and is aligned with the ratings earlier given by Moody’s Investors Service and S&P Global Ratings.

“The ratings on DBP and [Landbank] also reflect our expectation that the sovereign’s propensity to provide extraordinary support to both banks remains high in times of need,” the statement read, with the debt watcher citing unique policy mandates, full government ownership as well as systemic importance as the key drivers.

Concurrently, Fitch also raised the SRFs of BDO Unibank, Inc., Metropolitan Bank & Trust Co. (Metrobank), Bank of the Philippine Islands (BPI), Philippine National Bank (PNB), China Banking Corp. (China Bank) and Rizal Commercial Banking Corp. (RCBC).

Fitch upgraded the SRFs of Landbank, DBP, BDO, Metrobank and BPI to investment-grade “BBB-” from “BB+,” while those on China Bank, PNB and RCBC were raised to “BB,” two notches below investment grade, from “BB-.”

The debt watcher’s rating actions on the private banks also stemmed from the country’s improving capacity to provide support in times of need.

“We believe BPI, BDO and Metrobank are of strong significance to the banking system and economy, given their market shares of around 12%-18% by assets.”

“We also see the mid-tier banks — [China Bank], PNB and RCBC — as systematically important, albeit less so than their larger peers,” Fitch added. — KANV

Peso edges up as Fed hikes rates

THE PESO continued to move sideways against the dollar on Thursday as positive developments on the Philippine tax reform package tempered effects of the US Federal Reserve’s interest rate hike.

The local unit closed the session at P50.47 yesterday, inching up from its P50.48-per-dollar finish on Wednesday.

The peso opened stronger at P50.37, while its intraday high was registered at P50.35 a dollar. Its worst showing was P50.48 versus the greenback.

Dollars traded went down to $475.7 million from the $576.95 million that traded hands in the previous session.

A trader attributed the sideways movement of the peso to the result of the Fed’s two-day policy meeting.

“Today, we traded [higher] on the back of FOMC (Federal Open Market Committee) meeting last night,” the trader said on Thursday.

The trader noted that some were buying on dips in the afternoon session.

On Wednesday, the Fed raised key short-term rates by a quarter of a percentage point, as expected, and projected three more hikes in both 2018 and 2019, unchanged from the last round of forecasts in September.

That disappointed some investors, who had expected the Fed to raise its interest rate outlook next year, given robust economic growth and lower unemployment levels in the United States.

Meanwhile, Ruben Carlo O. Asuncion, chief economist at UnionBank of the Philippines, attributed the generally upbeat peso performance to the ratification of the first package of tax reform bill.

“The Fed rate hike has already priced in, so somehow, the impact of the [tax reform package] becoming a law affected the market more,” Mr. Asuncion said over the phone in Filipino.

“Generally, market players have upward sentiments on the TRAIN (Tax Reform for Acceleration and Inclusion bill), so it’s something good for the value of the peso,” he added.

On Wednesday night, the Senate and House of Representatives ratified the bicameral committee report on the tax reform package. The bill is now waiting for the approval of President Rodrigo R. Duterte. Once signed, it will be implemented by Jan. 1.

For today, a trader said the peso will move between P50.40 and P50.60, while Mr. Asuncion gave a wider range of P50.50 to P50.80.

Asian currencies rose against the dollar on Thursday, as a guarded outlook from the Federal Reserve on the economy weighed on the greenback following its widely anticipated interest rate rise.

The dollar index, which tracks the greenback against a basket of six major currencies, was down 0.06% at 93.370, after dipping 0.7% on Wednesday. — K.A.N. Vidal

Higher taxes seen to make PSE less competitive

By Arra B. Francia, Reporter

FOREIGN INVESTORS may lose their interest in the Philippine Stock Exchange (PSE) once it raises stock transaction taxes (STT) in 2018 as part of the first package of the government’s tax reform program due for implementation in the first quarter.

PSE President Ramon S. Monzon explained the 20% increase in STT — from 50 basis points (bps) to 60bps of the gross selling price — would make the local bourse less competitive against other markets in Asia.

“We have to be conscious about what the other capital markets are doing in the region, or even globally. Because the foreign investors will always go to a place where the transaction costs are less because it’s hard enough to make money on a trade. But if you add the transaction cost, we become very uncompetitive (compared) to the other stock exchanges,” Mr. Monzon told reporters in Makati late Wednesday.

The increased STT forms part of the first package of the Tax Reform for Acceleration and Inclusion (TRAIN), which Congress ratified on Wednesday evening. The tax measure would still need President Rodrigo R. Duterte’s signature before becoming a law.

The adjusted taxation scheme aims to collect up to P130 billion more revenues for the country, in order to finance the Duterte administration’s massive infrastructure program that would see over P8 trillion in spending for roads, railways, and airports, among others, in the next six years.

Mr. Monzon noted the Philippine tax imposed on stock transactions is already the highest in the region, followed by the Burma Malaysia Exchange with a tax of 30 bps of the transaction value. The Hong Kong Exchange charges a stamp duty of 10bps of the transaction value, while the Singapore Exchange has none.

“We really compete with the other exchanges like Thailand, Malaysia, Indonesia, Vietnam. We compete for the money of the foreign investors. So when you increase STT, you are increasing the friction cost. As it is right now, before the increase, that 50bps STT was already the highest in the whole region,” the PSE president said.

He added this could further impact the trading volume in the PSE, which remains at the same level as it had in 2016 despite recording fresh highs this year.

“We’ve had 12 new highs in the market this 2017. In fact, we hit the high of 8,600 in one trading day. We had a P62-billion tender offer from EDC (Energy Development Corp.)… And yet volume is just the same, if not less than volume for 2016,” Mr. Monzon said.

Given the increase in STT, the PSE would then have to launch more programs to attract more foreign investors.

“Obviously we need to do a lot of work to increase interest in our capital markets and at the PSE side, we are really embarking on a lot of initiatives to make it more attractive to the foreign investors,” Mr. Monzon said.

These initiatives include the launch of short selling functions and centralized securities borrowing and lending by the first quarter of 2018, as well as new indices in the future.

Jollibee continues branch expansion in Hong Kong, Brunei, UAE

HOMEGROWN fastfood giant Jollibee Foods Corp. (JFC) continues to expand in Asia and the Middle East, adding three new stores as it moves forward with its plan to increase revenue contributions from international operations.

JFC on Thursday said it recently opened three new stores located in Brunei International Airport, Hong Kong, and the United Arab Emirates (UAE).

The Brunei branch is the company’s 15th in the country, opened in time for JFC’s 30th year anniversary there.

“When we started our first Jollibee Brunei branch back in 1987, we wanted to appeal not only to Filipinos, but to locals as well. Thirty years on, we are very happy to see the growth of Jollibee into a brand which is well-loved by the Bruneian community,” said JFC Chief Executive Officer Ernesto Tanmantiong was quoted as saying in a statement.

Jollibee also opened an outlet in Wan Chai district,located on the northern shore of Hong Kong Island. The company noted the area has a population of around 180,000, of which 15,000 are Filipinos.

“The (Wan Chai) store posted impressive sales on its first three days of operation, showing a good balance of Filipino and local customers,” Mr. Tanmantiong said.

The listed fastfood giant opened the doors of its ninth store in UAE, which is JFC’s largest store in the country to date.

The new store openings are in line with JFC’s goal to become the fifth largest restaurant company in the world. Currently, the company ranks as the 11th largest global restaurant operator aside from being the biggest in Asia.

JFC targets to end the year with a total of 4,000 stores across the globe. As of September, it had a total of 3,644. Of this, 2,756 are in the Philippines composed of 1,023 under the Jollibee brand, 510 under Chowking, 262 under Greenwich, 411 under Red Ribbon, 471 under Mang Inasal, and 79 under Burger King.

Oveseas, JFC has a footprint of 888 stores. It has an additional 355 outlets under the Smashburger brand, where JFC holds a 40% interest.

This international store expansion will potentially drive foreign sales to 50% of the company’s total sales. As of 2016, international sales accounted for only 20% of JFC’s business.

In the first nine months of 2017, the company saw its net income attributable to the parent increase by 16.3% to P5.11 billion, following a 15% jump in revenues to P94.51 billion.

Shares in JFC shed P3 or 1.21% to close at P244 apiece at the Philippine Stock Exchange on Thursday. — Arra B. Francia

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