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Indonesia-US trade deal poses competition challenges for PHL

U.S. President Donald Trump delivers remarks at the Roosevelt room at White House in Washington, US, Jan. 21, 2025. — REUTERS

By Justine Irish D. Tabile, Reporter

PHILIPPINE EXPORTS to the US, especially garments and textiles, will face stiffer competition after Indonesia obtained a 19% tariff rate, according to an industry group.

Foreign Buyers Association of the Philippines President Robert M. Young called the Indonesia-US deal a “big blow.”

“This is again a big blow to the Philippines, particularly to the exports of garments, textiles, and apparel, because we are now at 20% and they are on 19%,” he told BusinessWorld by phone.

“To start with, they are much bigger in terms of exports to the US. Indonesia right now is shipping something like almost $5 billion worth of garments and textiles to the US, while the Philippines is still fighting for $1 billion,” he added.

US President Donald J. Trump said on his Truth Social platform that he finalized a deal with Indonesia on Tuesday that reduced the US tariff on Indonesian goods to 19%, much lower than the 32%. Mr. Trump assigned to Indonesia in a tariff letter last week.

Aside from opening the Indonesian market to the US, Mr. Trump said that Indonesia also committed to purchasing energy, agricultural products, and Boeing airliners from the US.

“For the first time ever, our ranchers, farmers, and fishermen will have complete and total access to the Indonesian market of over 280 million people,” Mr. Trump said.

“In addition, Indonesia will pay the US a 19% tariff on all goods they export to us, while US exports to Indonesia are to be tariff and non-tariff barrier free,” he added.

Mr. Young said the outlook for Philippine tariff negotiations is dimming as other countries’ negotiations with the US are weighted towards more geopolitical considerations.

“We really don’t know because actually in the past we have already offered everything in terms of military assistance and benefits. It was all exhausted by the Philippines, having been laid on a silver platter to the US,” he said.

“On trade, we are not at the level of the other countries to offer this kind of concession. As you know, we are a small player. It will be a difficult situation for the Philippines. I wish the team of negotiators good luck, but it seems like it will be a dim chance,” he added.

The government sent its negotiators to Washington this week to seek a lower tariff, with President Ferdinand R. Marcos, Jr. expected to arrive later this month.

Mr. Young said that he does not think the Philippines can offer a zero rate on US imports to match Indonesia.

“I don’t know if we can afford it. We are also relying on the taxes for our revenue. The other thing is, of course, this will be a Presidential action. But, in the Philippines, we have (to contend with) all kinds of legalities here and there,” he said.

“It has to go through the Congress. We really don’t know how we can manage. But we have so little to offer, so I don’t know if it will be attractive enough to the US. This is what we have been trying to say,” he added.

However, he said Secretary Frederick D. Go, the special assistant to the President for investment and economic affairs has hinted that the Philippines still “has some bullets.”

“I do not know what kind of bullets he is talking about, but that is what he said,” he added.

Aside from garment and textile exports, he said that Indonesia’s lower tariff can also impact other Philippine exports, including agricultural and mineral products.

“I’m not very familiar with the figures of agri and other minerals. But all of that can be affected because it’s a competition,” he said, noting that Indonesia already sells more because of its lower costs.

Meanwhile, he said that the garment and textile industries are still not giving up and seeking other markets to survive.

“We are not waving the white flag. We are fighting. We are looking for other markets; Russia is there,” he said.

“We are in survival mode,” he added.

PhilHealth rules out contribution rate hike after loss of subsidies

PHILSTAR FILE PHOTO

THE Philippine Health Insurance Corp. (PhilHealth) said on Wednesday that member contribution rates will not rise because they are fixed by law, adding that it will seek to offset the loss of government subsidies through operational efficiencies.

PhilHealth President and Chief Executive Officer Edwin M. Mercado said the efficiencies will come in the form of streamlined collections.

“Right now, (rates are) set by law. The maximum (premium contribution rate) is 5% of basic pay. At this point, it’s more about our efficiency in collecting from the paying sectors and direct members,” Mr. Mercado told reporters on the sidelines of the Management Association of the Philippines (MAP) general membership meeting.

The health insurer, however, is considering adjusting the cap on members’ basic monthly salary or income, which currently stands at P100,000.

“What’s being considered is a so-called progressive rate — those who can afford it might be able to contribute more. That’s what we’re currently studying,” Mr. Mercado said.

“Our economy is growing and the per capita income of Filipinos is also increasing, so that’s something we will look into. It’s not about raising the percentage, but rather adjusting the cap,” he added.

Under the Universal Health Care Act, PhilHealth charges its members a premium of 5% of their monthly basic salary or declared income, subject to a P10,000 salary floor and a P100,000 ceiling.

Last year, the government discontinued its subsidies for the health insurer, citing its large reserve funds.

Mr. Mercado said PhilHealth has about P480 billion in cash from retained earnings, which he said remain adequate to fund existing and planned benefit packages.

However, Mr. Mercado said PhilHealth is seeking additional funding for 2026 from the General Appropriations Act to support the planned upgrades to collection efficiency, as well as planned new benefit packages.

“Last week, the Department of Health and PhilHealth, had a meeting, and based on the benefit payments we expect for next year, we really had to request additional funding,” he said, noting that the extra funding to be requested is not yet final.

“We are also reviewing the benefit packages we have lined up. And if those get approval, there will be corresponding additional budget requirements. But… a large portion of what we will spend on benefit payments next year will also depend on our collection efficiency,” he added.

Earlier this year, PhilHealth introduced a set of expanded benefits, including coverage for ischemic heart disease — acute myocardial infarction, peritoneal dialysis, kidney transplants, preventive oral health services, and an outpatient emergency care benefit.

Mr. Mercado said PhilHealth is also investing more in primary care, including preventive measures such as screenings and early treatment. — Katherine K. Chan

Green energy auctions seen on track despite ERC revamp

STOCK PHOTO | Image by Dayanara Peenee from Unsplash

THE Department of Energy (DoE) said it expects no disruptions to its green energy auction (GEA) timetable, despite extensive personnel turnover in the agency responsible for setting ceiling prices.

Assistant Secretary Mylene C. Capongcol said that the DoE does not expect delay since the green energy auction reserve (GEAR) price for the fourth round of GEA (GEA-4) has been released and work on GEA-5 is ongoing.

“There are directors and other commissioners who are familiar with the GEAR pricing, the process is ongoing, but the final decision has to wait for the Commission to be complete,” Ms. Capongcol told reporters on Tuesday.

The DoE has launched two auctions, offering 10,478 megawatts (MW) of renewable energy capacity under GEA-4 and 3,300 MW of capacity under GEA-5.

GEA-4, which covers integrated renewable energy and energy storage systems as well as onshore wind, is scheduled for Sept. 2. 

Meanwhile, GEA-5 for offshore wind has gone through public consultations on the terms of reference. It is currently working on the GEAR price to guide potential bidders.

The Energy Regulatory Commission (ERC) determines the GEAR price, or the maximum price in pesos per kilowatt-hour that will serve as the ceiling price for the auction.

ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta submitted her “irrevocable resignation” on July 10 to the Office of the President (OP).

Her resignation coincides with the concurrent end of term for two ERC’s commissioners on July 9, raising concerns that this would deprive the commission of a quorum to perform its regulatory functions.

“I doubt it will be paralyzed because there are still units within the ERC that are active and continuously performing their mandate under the GEA and other regulations,” Ms. Capongcol said.

At a Palace briefing on Tuesday, newly appointed Energy Secretary Sharon S. Garin believes that the OP will immediately appoint a new ERC chair and replacements for the two commissioners.

“ERC is not under the DoE, it’s our regulator. It’s under the OP. There will be complications now that she’s gone because the number of commissioners will now only be two, no quorum. I think the OP will act swiftly to address that,” Ms. Garin said.

“Unfortunately, I don’t want the stakeholders to think that there’s a major overhaul of the energy industry… We will continue with the policies that are effective. We will do away with policies that are not helpful to the country,” she added.

Ms. Dimalanta left four years earlier than the end of her seven-year term.

“I’m glad I’m leaving at a point when I know I have done all I could for the reforms needed at ERC and I have not done anything I would regret,” she said via Viber.

Ms. Dimalanta said her irrevocable resignation “does not put the appointing authority in a possibly legally tenuous position. At the same time, we protect the agency by not setting a precedent on courtesy resignations or Cabinet reshuffles affecting an independent institution like the ERC.” — Sheldeen Joy Talavera

Council approves O&M deal for North-South rail project

JICA

THE Economy and Development Council has approved the P229.32-billion operations and maintenance (O&M) contract for the North-South Commuter Railway (NSCR) project.

The council, chaired by President Ferdinand R. Marcos, Jr., issued the decision at its July 15 meeting, the Department of Economy, Planning, and Development (DEPDev) said in a statement on Wednesday.

The 147-kilometer elevated railway line seeks to ease travel across three regions Central Luzon, Metro Manila, and Calabarzon — composed of Cavite, Laguna, Batangas, Rizal, and Quezon.

“The North-South Commuter Railway Project is a major step toward faster, greener, and more connected transportation as the system will also be integrated with the Metro Manila Subway. At the same time, it will promote green and commercial development along its corridors,” Economy Secretary Arsenio M. Balisacan said.

DEPDev said the railway will have 35 stations, including 31 elevated, three at-grade, and one underground.

Depots will be located in Clark, Valenzuela, and Calamba to support maintenance and operations, it said.

The project provides two types of train services.

The commuter line has 51 trainsets, each with a passenger capacity of 2,242. The Limited Express service will have seven trainsets of 386 passengers each.

These services are meant to improve travel speeds, with trains operating at 120 to 130 kilometers per hour, exceeding the current average commuter rail speeds of 20 to 40 kilometers per hour.

In addition, the DEPDev said the pre-operations phase of the project will run between March 2026 and July 2027.

“The concession period for the partial operations of Phase 1, which stretches from Clark International Airport (CIA) to Valenzuela (13 stations), will commence in December 2027 and continue until September 2028,” it said. 

The concession period for the partial operations of Phase 2, which extends service to Nichols with an additional segment from Alabang to Calamba, will run between October 2028 and December 2031.

Full operations are anticipated to start in January 2032.

At the same meeting, DEPDev kicked off the updating process of its mid-term progress assessment ahead of the necessary adjustments to targets and interventions.

“We have learned a lot of lessons from our past experiences and many of these have been reflected in our recent efforts. We will continue to stay on course to sustain our momentum for the second half of this administration,” Mr. Balisacan said.

DEPDev will solicit comments from the various agencies before finalizing the updated plan, which will be issued by the end of July. — Aubrey Rose A. Inosante

SteelAsia Quezon mill endorsed for expedited-permit treatment

THE Board of Investments (BoI) said it endorsed a P30-billion heavy-section mill in Candelaria, Quezon, to the One Stop Action Center for Strategic Investments (OSACSI) for green-lane treatment.

In a statement on Wednesday, the BoI said that SteelAsia Manufacturing Corp.’s (SAMC) mill and scrap recycling project in Quezon Province has been awarded green lane certification, which will entitle it to streamlined permitting.

Expected to begin operations by July 2027, the project is expected to create 655 in-plant jobs and 3,000 indirect jobs.

“The project involves the construction of a state-of-the-art facility that will employ Electric Arc Furnace (EAF) technology, prioritizing sustainability by using locally sourced recycled scrap metal instead of imported raw materials,” BoI said. 

“According to SAMC, this recycling process reduces carbon dioxide emissions by a minimum of 70% compared to traditional blast furnace methods, offering a more environmentally responsible approach to steel production,” it added.

The plant has the capacity to produce one million metric tons of heavy steel sections annually, which is expected to help reduce reliance on steel imports.

“The Candelaria steel mill will complement SAMC’s pioneering medium-section mill in Lemery, Batangas, which was also endorsed for green lane certification by OSACSI in 2023,” the BoI said. 

“The Lemery facility, currently under construction, will produce medium sections and merchant bars — products that are currently 100% imported,” it added.

Together, the two plants are expected to supply the Bataan-Cavite Interlink Bridge Project.

“(They will) help close critical gaps in domestic steel production, support fabrication shops, and boost the country’s industrial competitiveness across Southeast Asia,” the BoI said.

Between February 2023 and June, the BoI endorsed 222 projects for green-lane treatment, which have a total project cost of P5.748 trillion. — Justine Irish D. Tabile

PHL seen among countries driving global meat consumption growth

REUTERS

THE PHILIPPINES joins a select group of growing economies that will drive expanding meat consumption over the next decade or so, the Food and Agriculture Organization (FAO) and the Organisation for Economic Cooperation and Development (OECD) said.

In their agricultural outlook for 2025-2034, the FAO and the OECD said global poultry, sheep meat, beef, and pork consumption are projected to grow 21%, 16%, 13%, and 5%, respectively, by 2034.

“Due to rapid consumption and income growth, 45% of global growth will be located in upper middle-income countries,” it said, noting that meat consumption growth, aside from China and India because of their substantial populations, is expected to be greatest in the Philippines, Brazil, Indonesia, the US, and Vietnam.

Global meat production was estimated to have risen by 1.3% to 365 million metric tons (MMT) in 2024, driven by poultry, “with beef output increases,” it said. Pig and sheep meat production remained stable.

Significant growth in meat production occurred in Australia, Brazil, the European Union, and the US.

Brazil, the Philippines’ largest source of meat imports, recorded the “most significant expansion” across all major meat categories, “driven by strong global demand, supported by higher net returns due to a favorable exchange rate and lower feed costs as well as continued disease-free status.”

Global meat exports recovered in 2024, rising 2% to 40.2 MMT after two years of decline, due in large part to expanded imports by the Philippines, the United Arab Emirates, and Mexico.

The report also said the Philippines, Brazil, Egypt, Mexico, and the US, will account for a significant segment of global poultry consumption, which is expected to hit 173 MMT on a ready-to-cook basis by 2034.

By that year, poultry meat is expected to account for 45% of the protein consumed from all meat sources, it said.

The increase in poultry consumption in the last decade was driven by China, India, Indonesia, Pakistan and Vietnam.

“The global increase in protein from poultry meat consumption as a share of total protein from meat has been the main feature of the growth in meat consumption for decades, and this trend is expected to continue,” the report found.

It cited poultry’s low cost and favorable nutritional profile, specifically a high protein-to-fat ratio compared to other meats.

“Environmental considerations also contribute to the shift towards poultry meat, as the production of red meat is more resource-intensive and leads to higher greenhouse gas emissions,” it added. “Poultry is, therefore, more appealing to sustainability-conscious consumers.”

The FAO said in most high-income countries, which accounted for 35% of global meat consumption but only 17% of the world’s population in 2024, growth in per capita meat consumption will continue to slow, with consumers shifting preferences — “often reducing meats like beef and pork in favor of poultry.”

“Higher-income consumers are increasingly attentive to the animal welfare, environmental, and health attributes of food, which in some places is leading to stagnating or even declining per capita meat consumption,” it added.

Philippine meat imports in the first quarter rose to 344.59 million kilograms (kg), from 273.64 million a year earlier.

Pork accounted for 53.2% or 70.45 million kg of all meat entering the country in the first quarter, against 128.5 million a year earlier.

It was followed by chicken at 111.36 million kg or 32.3% of first-quarter meat imports.

Beef imports in the first quarter rose 24.2% to 43.9 million kg or 12.7% of all meat imports. — Kyle Aristophere T. Atienza

Flavored salt touted as opportunity for coastal producers to add value 

PHILIPPINE STAR/ EDD GUMBAN

THE Department of Agriculture (DA) said value-added salt products are expected to expand opportunities for traditional producers in coastal communities.

The salt products developed by the National Fisheries Development Center of the Bureau of Fisheries and Aquatic Resources are fortified with iodine and infused with lemongrass, ginger, and garlic.

“Designed to address public health concerns such as iodine deficiency disorders, they also offer a platform for micro, small, and medium enterprises (MSMEs) to thrive, especially in rural and coastal communities with rich salt-making traditions,” the DA said.

The value-added salt products include lemongrass-flavored tanglasin, a citrusy finishing salt ideal for seafood, poultry and tropical dishes; ginger-flavored ginsin for broths, rice porridge, and stir-fries; malunggay-flavored salt; and garlic-flavored salt.

The products also include varieties with oregano, basil, and thyme; pepper salt; and chili-flake salt.

“For many years, the salt industry has faced significant challenges such as insufficient support services, the impact of climate change, urbanization, and intensifying market competition,” the DA said. — Kyle Aristophere T. Atienza

Tourism MSMEs offered SBCorp. loan package

THE Department of Tourism (DoT) said on Wednesday that it launched a loan program targeted at tourism micro, small, and medium enterprises (MSMEs) seeking to scale up and improve service quality.

In a statement, the DoT said the Turismo Asenso multipurpose loan program follows the signing of a memorandum of agreement with the Department of Trade and Industry (DTI).

“With tourism contributing 8.9% to our GDP and providing jobs to over 6.75 million, our approach has always been to grow it as a powerful economic driver,” Tourism Secretary Christina G. Frasco said.

“The Turismo Asenso loan program is part of this vision — giving our tourism MSMEs the capital they need to expand, hire more people, and improve services. This is real, accessible support for the entrepreneurs at the heart of our tourism economy,” she added.

The DTI’s financing arm, the Small Business Corp. (SBCorp.), the loan program will allow MSMEs to borrow up to P20 million.

“For non-collateral loans, new borrowers may access up to P3 million, while existing borrowers may qualify for loans of up to P5 million. Flexible repayment terms of up to five years are also available,” the DoT said.

To avail of the loan, the applicant must have a Filipino-owned registered business or a business with at least 60% Filipino ownership.

The business must also have a track record of at least one year, hold assets not exceeding P100 million excluding land, and be free of past-due accounts in any SBCorp. programs and other major negative credit findings. — Justine Irish D. Tabile

VAT on digital services: Unraveling recharges and allocated costs

Digital services have become essential in today’s fast-paced world. For businesses, companies increasingly rely on cloud-based tools or enterprise software to enhance efficiency and aid in data-driven decision making, despite the significant investment these technologies often require. Multinational companies (MNCs) often contract with digital service providers (DSPs) at a global level, through their parent entities or regional headquarters and allocate or recharge the corresponding costs to their subsidiaries or affiliates based on consumption, including those in the Philippines. This leverages purchasing power to secure better deals, reduce costs, and maintain consistent service quality across all members of the group, even those located in other countries.

With the signing of Republic Act No. 12023, or the VAT on Digital Services Act, digital services provided by non-resident digital service providers (NDSPs) for Philippine consumers are now subject to 12% VAT. “Digital service” is defined as any service that is supplied over the internet or other electronic network with the use of information technology and where the supply of the service is essentially automated.

While there are still ongoing discussions around what exactly qualifies as “supplied over the internet” and “essentially automated,” the intention of the law is clear — to subject digital services consumed in the Philippines to 12% VAT, regardless of the residence of the service provider. However, questions may arise when these services are charged through cost allocations or recharges from a non-resident parent or affiliate. Should VAT still apply when the Philippine entity is not the direct contracting party of the NDSP, but simply bears its share of costs initially paid by its non-resident parent or affiliate? More importantly, which foreign entity would be reported as the actual NDSP and would bear the obligation of registering for and reporting the VAT?

The answer to the first question is quite straightforward since the VAT is imposed on consumption by a Philippine customer. In Q&A No. 30 of Revenue Memorandum Circular (RMC) No. 47-2025, the Bureau of Internal Revenue (BIR) confirmed that if the contracting party of the NDSP is outside the Philippines, for instance a non-resident parent or affiliate, and the costs are shared with different markets including Philippine subsidiaries, the allocated costs or recharges are to be subject to 12% VAT if these pertain to digital services consumed in the Philippines. The RMC reiterated that the VAT on Digital Services is based on consumption, not on the physical presence of the service provider in the Philippines. Accordingly, in these Business-to-Business (B2B) transactions, the Philippine subsidiary is responsible for withholding and remitting the VAT on the allocated costs attributable to the digital services it utilizes locally.

However, the RMC did not clearly discuss how this would be implemented. In particular, will a shared cost arrangement require the non-resident parent or affiliate to register as the NDSP in the Philippines, even if it merely passes on the cost and does not perform any digital services?  Based on the language and objective of the law, I believe the registration requirement should remain with the third-party service provider, as this is the entity actually supplying the digital services consumed in the Philippines. It is likely that these NDSPs are also providing services to other Philippine customers and so are likely already registered for VAT. In contrast, the non-resident parent or affiliate merely acts as a pass-through entity for cost efficiency and to facilitate the income payments attributable to the digital services consumed by the Philippine subsidiary. To require the mere intermediary entity to register would unduly add an administrative burden that would negate the leverage that was gained by MNCs from such arrangements, and would not really benefit the government anyway. If at all, it would just add another layer of information that the government would have to sift through and eventually eliminate when collating information on digital services that consumed in the Philippines. Nonetheless, it would be helpful for the BIR to issue further guidance to clearly establish which entity must comply with the registration requirements and the corresponding documentation (for example, the relevant withholding tax reporting) in this type of scenario.

From a commercial perspective, the practice of imposing VAT on recharges or allocated costs may pose significant financial considerations within the global group of entities, especially if the amount of digital services is high and the Philippine customer is not able to claim the input VAT credit. The parties will need to agree on the VAT payment arrangement, whether this will be shouldered by the non-resident or by the Philippine payor. The non-resident parent or affiliate may reasonably push back against having 12% VAT withheld on the recharged amount, especially if it has already paid the full cost to the third-party service provider and it has no means to recover the VAT withheld by the Philippine subsidiary.

While the VAT withheld can be recovered by the Philippine customer/withholding agent by using it as credit against its output VAT, the withholding of tax will still require an upfront cash outlay. Certain taxpayers or industries may also not be able to immediately utilize the VAT withheld as credit (e.g., those who are engaged in VAT zero-rated transactions), or may be forced to absorb the cost (e.g., those who are engaged in VAT-exempt sales, who can only claim the input VAT as expense for income tax purposes).

In either case, regardless of the arrangement adopted by the non-resident parent or affiliate, it would be advisable for the parties to ensure that the agreement clearly states the VAT arrangement on recharges/cost allocations, and where VAT applies, the party who will shoulder the VAT due.

I hope that these matters will be clarified by the BIR soon to help support continued compliance from taxpayers. In the meantime, as digital services become deeply embedded in business operations, Philippine entities of MNCs may help manage the implications of the recharges and allocated costs by:

• Reviewing the intercompany service agreements to check whether the underlying services fall within the scope of “digital services” as defined by law;

• Coordinating with non-resident parents or affiliates and agree which entity will shoulder the cost of and account for the 12% VAT if the recharges and allocated costs are attributable to digital services consumed in the Philippines; and

• Revisiting and amending contracts to clearly describe how the services are delivered, where such services are rendered, and what type of outputs are provided. These details will help manage the risk of non-digital services being mistakenly classified as digital services subject to 12% VAT.

In navigating the complexities of the VAT on Digital Services, taxpayers can turn potential challenges into strategic advantages by aligning intercompany agreements and defining service parameters. By negotiating VAT responsibilities and staying adaptable, they can ensure compliance, and optimize operations, all while leveraging the group’s centralized procurement and digital tools for improved performance and growth.

The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of Isla Lipana & Co. The content is for general information purposes only, and should not be used as a substitute for specific advice.

 

Ron Jacob Abaday is a senior associate at the Tax Services department of Isla Lipana & Co., the Philippine member firm of the PwC network.

+63 (2) 8845-2728

ron.jacob.abaday@pwc.com

PHL deploys long-idled Dalian trains, launches 50% senior fare discount

PRESIDENT Ferdinand R Marcos, Jr. leads the inspection of the Camp Aguinaldo Station of the Metro Manila Subway project in Quezon City. — CHLOE MARI A. HUFANA

By Chloe Mari A. Hufana, Reporter

THE PHILIPPINE government on Wednesday launched the first batch of long-idled Dalian train cars, more than a decade after they were bought from China, as it tries to ease congestion in Metro Manila’s rail network and improve public transportation.

President Ferdinand R. Marcos, Jr. led the rollout ceremony at the Metro Rail Transit Line 3 (MRT-3) Santolan-Annapolis station in Quezon City, where he announced that three Dalian trains — each consisting of three coaches — had officially begun commercial operations on the same day.

This marks the first time any of the Dalian trains have been used since the government acquired 48 train sets from Chinese manufacturer CCRC Dalian Co. in 2014. The trains were delivered in 2016 but remained unused due to technical incompatibilities with the MRT-3’s existing infrastructure and signaling systems.

“Now there are already three trains with three coaches each, so that’s nine cars in total,” Mr. Marcos said in Filipino. “Out of the 48, we will continue to look into and find ways to use them because they’ve been parked here for 10 years without being used.”

The deployment of the Dalian trains will reduce the waiting time between trains on the MRT-3 from four minutes to 2.5 minutes, effectively increasing the line’s capacity, according to the Presidential Communications Office.

The launch comes amid worsening traffic in the capital, which ranked as the 14th most congested city in the world in 2024, with an average of 32 minutes and 10 seconds needed to travel just 10 kilometers, according to the TomTom Traffic Index released in January.

Data from the Department of Transportation showed that MRT-3 served more than 135 million passengers last year, equivalent to about 380,000 daily riders.

However, the launch also drew criticism from commuter advocacy group PARA Commuters’ Network, which said the government was simply putting a band-aid on deep-rooted transport problems.

“Marcos and [Transportation Secretary Vivencio B.] Dizon distract us with short-term comforts, but in exchange, we face longer suffering and higher fares under their pro-business policies,” the group said in a Viber message. “Our call is this: public transportation should be a public service.”

The group criticized the government for celebrating the use of just three out of the 48 Dalian trains, which cost taxpayers over P500 million and had remained idle for nearly a decade.

PARA also warned that despite the MRT-3’s full transfer to government ownership by July 2025, the Marcos administration still appeared committed to further privatization of transport services.

“This policy has wasted billions in public funds on fees and rent while delivering poor services marked by frequent interruptions, outdated systems, and inefficiency under various private operators,” the group added.

During the same inspection, Mr. Marcos also launched a 50% fare discount for senior citizens and persons with disabilities (PWD) for LRT-1, LRT-2 and MRT-3 — extending a similar benefit earlier granted to students in June.

“Previously, we were able to give discounts to our students… Now, we will add senior citizens and persons with disabilities to that group who will receive a 50% discount,” he said.

The initiative raises the statutory discount from 20%.

Mr. Marcos said the policy is expected to benefit about 13 million senior citizens and 7 million PWDs nationwide.

Mr. Dizon said the discounts would apply daily and the government would consider expanding the program to other modes of public transport.

Also on Wednesday, Mr. Marcos inspected the Metro Manila Subway project and vowed to complete it by the end of his term in 2028.

“We might finish this (Valenzuela to Ortigas) by 2028; maybe we can inaugurate it in 2028,” he told reporters in Filipino at the Camp Aguinaldo station site.

The 33-kilometer underground railway will span 17 stations from Valenzuela City to Parañaque City and is expected to cut travel time from Valenzuela to Ninoy Aquino International Airport from two hours to just 40 minutes.

A tunnel boring machine for Contract Package 103 was recently launched from Camp Aguinaldo toward Ortigas, tunneling beneath White Plains, Corinthian Properties and the Meralco compound.

VP ‘eager’ to face ouster trial if Supreme Court allows it

VICE-PRESIDENT SARA DUTERTE-CARPIO — FACEBOOK.COM/MAYORINDAYSARADUTERTEOFFICIAL

VICE-PRESIDENT (VP) Sara Duterte-Carpio is ready to face the Senate impeachment court, her office said on Wednesday, even as her legal team pursues lawsuits to stop the trial and dismiss what they describe as a “defective” complaint.

“The Vice-President said she wants to go to trial,” Office of the Vice-President (OVP) spokesperson Ruth B. Castelo told a news briefing on Wednesday. “She’s eager to be able to present her case, or her evidence, in the impeachment court so that once and for all, all doubts cast on her will go away.”

The House of Representatives impeached Ms. Duterte, a likely contender in the 2028 presidential race, in February on charges of budget misuse, unexplained wealth, and allegedly conspiring to assassinate President Ferdinand R. Marcos, Jr., his wife, and Speaker Ferdinand Martin G. Romualdez. She has denied all accusations.

The impeachment complaint gained the support of more than 200 congressmen — well beyond the constitutional threshold of one-third required to elevate the case to the Senate for trial.

Her legal team has questioned the legality of the impeachment, arguing before the Senate that the House violated the constitutional one-year bar on initiating more than one impeachment complaint against the same official. Two petitions have also been filed before the Supreme Court to halt the proceedings.

“In this case, the lawyers or the Vice-President are taking legal remedies, legal strategies that are allowable in our system,” Ms. Castelo said. “The Vice-President will just wait for whatever decision the Supreme Court issues on this one. And should the impeachment trial go as planned, the Vice-President is prepared.”

The Supreme Court consolidated the two petitions on July 8 and ordered the House and Senate to respond. Ms. Duterte’s supporters claim her right to due process was violated during House proceedings.

Ms. Castelo said halting the impeachment trial would save public funds.

“If the Supreme Court says it cannot be heard at this time, then we’ll be very lucky actually… as we’ll save millions and millions of money on a trial that is technically defective from the very beginning,” she said. “Let’s not waste the country’s resources. There are more important things we need to spend on.”

The Senate is expected to convene as an impeachment court shortly after the 20th Congress opens. A recent Social Weather Stations survey found that six in 10 Filipinos think the Vice-President should face trial and respond to the charges in the Senate.

Support for the trial was strongest in Metro Manila, where 76% backed the move. It was followed by Luzon at 69% and the Visayas at 67%. Mindanao, Ms. Duterte’s political stronghold, registered the lowest support at 55%.

The Philippine Senate is eyeing Aug. 4 as the new date to reconvene as an impeachment court, Senator Emmanuel Joel J. Villanueva separately told reporters.

He said the Senate needs time to finalize committee chairmanships and leadership roles for the 20th Congress, which opens on July 29. “In my discussion with other senators and Senate President Francis G. Escudero, once we are able to organize the leadership and committees, perhaps we are looking at Aug. 4.”

The Senate was originally expected to convene as an impeachment court on July 29, a day after Congress opens. Senator-judges must take their oath before the trial begins.

Earlier, Senate President Escudero expressed intent to stick with the original schedule, saying the court would “no longer tolerate any dilatory motion or pleading.”

However, the proposed Aug. 4 schedule would give both chambers more time to settle internal matters, Mr. Villanueva said.

“Then, the week after, we can convene the impeachment court and have the defense and prosecution present their cases,” he said. “By Aug. 4, the new roster of senator-judges will take their oaths.” — Kenneth Christiane L. Basilio and Adrian H. Halili

Crising may intensify into storm, hit northern Luzon by Friday — PAGASA

SATELLITE photo of Crising. — DOST/PAGASA

A LOW-PRESSURE area east of Catanduanes has developed into a tropical depression, according to the state weather bureau.

The tropical depression that authorities named Crising may intensify into a tropical storm by Thursday morning, the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) said on Wednesday. It could reach the severe tropical storm category by Friday, it added.

Crising was spotted 625 kilometers east of Virac town in Catanduanes as of 4 p.m., the agency said in a 5 p.m. report.

It was moving westward at 20 kilometers per hour (kph), packing maximum sustained winds of 45 kph near the center, gustiness of up to 55 kph and central pressure of 1002 hectopascals.

“Strong winds extend outwards up to 280 km from the center,” PAGASA said.

It said tropical cyclone wind signal No. 1 might be hoisted over portions of Cagayan Valley by Wednesday evening or early Thursday morning.

“Should Crising maintain its westward movement or increase its radius, the possibility of raising tropical cyclone wind signal No. 1 over Catanduanes is also not ruled out,” it said. “Furthermore, the highest wind signal which may be hoisted during the occurrence of Crising is wind signal No. 3 or 4.”

Earlier in the day, PAGASA said Crising was forecast to move west-northwestward throughout the forecast period. It was expected to be closest to northern Luzon by Friday evening.

“It is forecast to continue intensifying over the Philippine Sea and may reach severe tropical storm category by Friday afternoon or evening, prior to its approach to the northern Luzon area.”

PAGASA said Crising’s development into a typhoon category “prior to approach is not ruled out.”

Crising may pass close to or make landfall over the Babuyan Islands, while a “slight change in the succeeding forecast track may also suggest a landfall scenario over mainland Cagayan.”

The Philippines lies along the typhoon belt in the Pacific and experiences about 20 storms each year. It also lies in the so-called Pacific Ring of Fire, a belt of volcanoes around the Pacific Ocean where most of the world’s earthquakes strike.

The Southeast Asian nation constantly experiences unavoidable losses and damage equivalent to 0.5% of its annual economic output mainly due to an increasingly unpredictable climate, according to the Finance department. — KATA

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