THE PESO is expected to weaken against the dollar this week, with Federal Reserve (Fed) officials likely to deliver hawkish speeches amid mixed perceptions on upcoming US economic data.
On Friday, the local currency moved sideways, losing four centavos to close at P50.72 versus the dollar.
This was still better than its P50.95-per-dollar close last Nov. 17.
The first three days of last week saw the peso rally as uncertainty over the US tax reform package. However, the dollar started to correct on Thursday amid the dovish tone of the Federal Open Market Committee (FOMC) minutes.
“The dollar might continue to appreciate this week due to likely hawkish speeches from various US Federal Reserve officials,” Land Bank of the Philippines market economist Guian Angelo S. Dumalagan said in an e-mail.
He said the speeches “might continue to affirm their views of another US interest hike” in the yearend despite uncertainties over the “subdued” US inflation.
Concerns on persistently low inflation were addressed in the FOMC minutes, as several participants “expressed concern that the persistently weak inflation data could lead to a decline in longer-term inflation expectations or may have done so already.”
On Tuesday, incoming Fed chair Jerome H. Powell will deliver a speech, which the market will watch for clues on his future policy direction.
“The speech of Fed Powell on Tuesday might heavily influence markets since he is expected to succeed [incumbent] Fed [chair Janet L.] Yellen as the head of the US central bank,” he noted.
Other Fed officials expected to deliver hawkish speeches this week are Ms. Yellen, John B. Williams, Robert S. Kaplan, among others.
Meanwhile, a trader said that US economic data to be released this week might book mixed results, which could temper the effect of the speeches of several Fed officials.
“We’re looking at the US GDP (gross domestic product) growth [in the third quarter] — we can expect a pickup from last quarter,” a trader said.
Mr. Dumalagan, meanwhile, cited that US data on personal spending and personal income might “show softer readings.”
Traders expect this week that the peso will move between P50.60 and P50.90 versus the dollar, while Ruben Carlo O. Asuncion, chief economist of UnionBank of the Philippines, gave a wider reading of P50.50 and P51 as he expects thinner trading volume as the yearend nears. — K.A.N. Vidal
PRIVATELY OWNED National Grid Corporation of the Philippines (NGCP) said it had set aside its fiber optic network for the government’s national broadband program as it awaits a formal agreement with the Department of Information and Communications Technology (DICT).
“We’re working with DICT. The capacity available for third-party use will be offered to government first for its project. And we’re eager to start working with them,” NGCP spokesperson Cynthia P. Alabanza told reporters. “We’re looking forward to the agreement so that the project can start.”
This comes as the DICT along with the Bases Conversion and Development Authority signed earlier this month a landing party agreement with Facebook, called the Luzon bypass infrastructure, to improve the country’s broadband internet speed and accessibility.
Ms. Alabanza said NGCP could be a part of the government’s broadband plan as it has an existing facility that could be used for the purpose.
But so far, what had been agreed upon by NGCP and DICT, under the department’s previous leadership, is an agreement to explore a partnership. There has been no assessment of NGCP facilities, and no due diligence conducted.
The government also has yet to determine whether the grid operator’s fiber optic network is compatible with the government’s broadband plan.
Ms. Alabanza said NGCP was unsure whether DICT would piggyback on its broadband and branch out from there.
“We can be a part of it. Connectivity is an important part of not just transmission but daily life,” she said.
In June, NGCP said it had been chosen as a partner of the DICT, under then Secretary Rodolfo A. Salalima, for the government’s broadband program.
NGCP had expressed optimism in the project, which it described as bringing the country’s average internet speed closer to those of “first-world countries.”
Privately owned NGCP said its fiber optic cables, which cover 6,154 kilometers or 160,779 fiber kilometers, will be the primary network of the program that aims to bring Wi-Fi connection all over the country.
THE Department of Finance (DoF) aims to have the fuel marking system, a deterrent to smuggling, set up by the first half next year, as the procurement process gears up for launch.
The DoF is close to completing of the terms of reference (TOR) for procuring providers of the marking system.
“The TOR is almost done, the final version will be completed by the end of this month. It will be published in the newspapers,” Finance Undersecretary Antonette C. Tionko told reporters last week at the DoF headquarters.
“Procurement is expected to start within the year. By December, the procurement process and finished by the first quarter, and we want to implement already by the second half,” she added.
Finance Secretary Carlos G. Dominguez III meanwhile said that the fuel marking system will be implemented alongside a series of random inspections.
“We will also check the distribution randomly,” he said, adding that the Bureau of Internal Revenue personnel will be trained on auditing procedures.
“Basically it’s an outsourcing contract, a service. We will not run it ourselves,” Mr. Dominguez said.
He said there are “many” interested parties for the fuel marking contract.
Ms. Tionko said some concerns of stakeholders are still being addressed in the TOR.
“They always have concerns, anything you change is their concern, at what point do we put the marker…It’s a bit technical, but the thing is each company has its own system. Those are the things we need to work on, it’s nothing fundamental but technical,” she said.
The DoF has allotted P2 billion for the procurement of service providers, and expects to generate some P25 billion in additional annual revenue.
The fuel marking scheme is part of the Tax Reform for Acceleration and Inclusion Act — which is currently undergoing plenary debate in the Senate.
The measure involves the use of low concentrations of markers or dyes to be blended with the fuel, to mark the stages undergone by a particular batch of product, which will determine whether shipments have gone through the legal supply chain. Absence of the marker will be taken as prima facie evidence that the petroleum products are imported or withdrawn without the payment of excise tax.
The dyes are expected to cost some P.09 centavos per liter, to be passed on to consumers.
The DoF estimated revenue losses from smuggled or misdeclared fuel of P26.87 billion in 2016.
In a 2015 Government Brief by the Asian Development Bank, which discussed fuel marking, the bank estimated $750 million, or P37.5 billion worth of foregone revenue due to smuggled oil in the Philippines for 2014.
The Institute for Development and Econometric Analysison the other hand estimated that “smuggled gasoline accounts for an average of 23% of gasoline consumption from 2000 to 2006,” while “smuggled diesel accounts for an average of 6%.”
In 2016, the government collected P52.56 billion from petroleum products.
The earlier implementation of the fuel marking system was mandated by Finance department Order 23-07 in 2007. The Department of Energy however in 2013 issued a memorandum circular stating that starting 2014, oil companies shall no longer be required to use a chemical marker to their fuel products. — Elijah Joseph C. Tubayan
SUCCESSFULLY claimed Game One of their best-of-three University Athletic Association of the Philippines (UAAP) men’s basketball finals series last Saturday, the Ateneo Blue Eagles, while happy to have taken the upper hand, are not about to let their guard down, knowing fully that rivals and defending champions De La Salle Green Archers can only be expected to make the necessary adjustments come the next game.
Boosted by what they consider as “total team effort” in the series opener, the Katipunan-based dribblers were able to take control much of the game and withstand the tough fight the Archers put up especially down the stretch to hack out a 76-70 victory that put them one win away from winning it all.
Thirdy Ravena led a balanced attack by Ateneo, finishing with 12 points, six rebounds and four assists.
Mike Nieto came off the bench to provide much-needed firepower, scoring all of his 11 points in the second half, while twin brother Matt defied a cut left eye brow to add 11 as well.
Anton Asistio finished with 10 points with Vince Tolentino and Aaron Black adding nine and seven points, respectively.
Defensively, the Eagles, too, were on top of things, limiting in particular league most valuable player Ben Mbala to just eight points and the whole La Salle team to just 70.
But while they take pride and delight to what they were able to do in the first game, the Eagles are expecting the Archers to come back more motivated than they already are in Game Two on Wednesday and armed with added template to try to level things, necessitating for Ateneo to come out more prepared as well.
“This is where the chess game comes in. La Salle will make their adjustments so we have to be able to read them and try to make our own adjustments to what they are trying to do,” said Sandy Arespacochaga, Ateneo assistant coach, during the postgame press conference after Game One.
“La Salle is the defending champion and for sure they will come out next game more motivated. We have to have the mentality that we have to step up our game and not be content with this win,” he added.
As for their effort to limit Mbala in the finals paying off massively in the series opener, Mr. Arespacochaga said credit should be given to their players, considering they had a short turnaround between the semifinals and the finals.
“We couldn’t play Ben Mbala straight up one-on-one so we needed to come up with a scheme defensively that had other players helping to slow down Ben. Credit to our players because we came from our last game (semifinal) last Wednesday and we couldn’t do anything live. It was mostly mental and watching videos. The players implemented our game plan. And while there were mistakes, we are nonetheless happy with the way we executed,” Mr. Arespacochaga said.
He went on to say that they hope to stay consistent on the defensive end and rise over the physicality of the affair for them to have a better shot at closing out the series in Game Two at the Smart Araneta Coliseum.
THE PROPOSED 2018 national budget as tackled by the Senate is back on track for second and final reading approval on Tuesday, Nov. 28, said the office of Senator Loren B. Legarda, chairperson of the Senate finance committee.
“Tuesday, 10:00 a.m. pa ang (is the schedule for) budget amendment. Expected din na ma-approve na (It is also expected that the 2018 budget will be approved) on 2nd and 3rd reading sa (on) Tuesday,” a communications officer said on Ms. Legarda’s behalf.
The proposed budget is over P3.7 trillion, 12.4% higher than this year’s budget of P3.35 trillion.
Senate Minority Leader Franklin M. Drilon is expected to formally present his proposal on Tuesday realigning the P900 million allotted for the PNP’s anti-illegal drug campaign, including the DILG’s P500 million for its anti illegal drugs, crime and corruption program or the Mamamayang Ayaw Sa Anomalya,Mamamayang Ayaw Sa Iligal na Droga (MASA MASID) program.
Meanwhile, the period of amendments on package 1 of the Tax Reform for Acceleration and Inclusion bill (TRAIN) will continue on Monday, Nov. 27.
Last week, Senate Majority Leader Vicente C. Sotto III said in an interview the next station for TRAIN is its “automatic” approval on second reading.
“Kung matatapos yung (If we finish the) period of amendments, the next step is to approve it (on) second reading automatically,” Mr. Sotto said.
Mr. Sotto also said “[i]t can be approved on third reading (this week) because it is a certified urgent measure.”
Among the amendments the Senate is expected to take up in today’s session are the proposed excise taxes on cosmetic surgeries, fuel products, sugar-sweetened beverages, and Senator Paolo Benigno A. Aquino IV’s proposed amendment ensuring the implementation of the unconditional cash transfer program starting January next year.
Mr. Drilon may also present today his proposed amendment which seeks to impose a “20% luxury or vanity tax on procedures which serve no purpose except for aesthetic appeal.”
For amendments to excise tax on sugar sweetened beverages, Mr. Angara said in a radio interview that “perhaps there will be a debate as to how much the tax should be.”
Meanwhile, for fuel, Mr. Angara said: “Sa amin, maintain pa rin yung sked na di tataas ng P1.75 (For us, we will maintain the fuel excise tax schedule which should not go beyond P1.75 in the first year).”
“Yun ang palagay naming kaya ng tao at mga negosyo (This tax is what we think people and businesses can manage),” he added.
WON its opener in the Asian Qualifiers for the FIBA World Cup 2019 last Friday in Japan, Gilas Pilipinas looks to sustain its winning form when it plays today against Chinese Taipei in Group B action set at the Smart Araneta Coliseum.
While it struggled to establish fluidity in its game on both ends of the court all throughout the match, the Philippine national team did just enough to stave off the Akasuki Five, 77-71, in the latter’s home turf and book its first win in the qualifiers.
Jayson William led Gilas to the tough win, finishing with 20 points, seven rebounds and six assists.
Naturlized player Andray Blatche had it rough on offense, shooting just 36% on the floor, finishing with 13 points to go along with 12 rebounds and five assists.
Matthew Wright had 12 points while veteran Gabe Norwood had 10.
Now playing at home, Gilas hopes to perform better in front of the hometown fans and notch a win over Chinese Taipei and establish a good cushion in the qualifiers.
In the Asian Qualifiers, the top three teams in the four groupings advance to the next stage of the competition.
Upon arriving in Manila at the weekend, the Chot Reyes-coached nationals went straight to practice to stay in “tournament mode.”
BOUNCE BACK
Out to spoil Gilas’ homecoming is Chinese Taipei, which lost its group opener at home against Australia, 101-66, also last Friday.
Chinese Taipei never really got it going against Australia, which dominated from start to finish.
Naturalized player Quincy Davis III led the team with 17 points with forward Cheng Liu and big man Kuan-Chuan Chen scoring 10 points apiece.
The just-started qualifiers is the first stretch of six home and away games for competing teams during competition windows set by world basketball governing body FIBA in its new competition system.
The next windows are in February and June next year.
Meanwhile, consortia between Argentina and Uruguay and among the Philippines, Japan and Indonesia were short-listed as finalists to host the FIBA World Cup in 2023, the basketball body announced recently.
FIBA said both candidates submitted host nation agreements on the deadline day to confirm their interest in holding the 19th edition of the competition.
“We are pleased to announce Argentina/Uruguay and Indonesia/Japan/Philippines as the final two candidates in the running to host the FIBA Basketball World Cup 2023. In recent years, we have seen the way in which several countries teaming up to stage our biggest tournaments has been successful. This was the case at the last two editions of the FIBA EuroBasket as well as at FIBAAfroBasket 2017 and the FIBA AmeriCup 2017. We are fully confident this formula will also work to great effect for our flagship competition. Furthermore, these are countries with rich basketball traditions and passionate fans,” said Patrick Baumann, FIBA secretary-general and International Olympic Committee member, in a statement shared to global sports media.
The two bidders, FIBA said, will present their candidatures to FIBA’s Central Board Dec. 9 in the following order — Indonesia/Japan/Philippines and Argentina/Uruguay.
The hosts of the competition will be announced on that day following a vote by the Central Board.
THE Department of Transportation (DoTr) will order new feasibility studies for four regional airport projects, with the studies targeted for completion next year.
The government has said it is open to auctioning off the operations and maintenance (O&M) component for the regional airport projects, after removing the regional airport projects — New Bohol (Panglao), Davao, Iloilo, Laguindingan and Bacolod — from the public-private partnership (PPP) pipeline in favor of funding the construction via government appropriations or overseas development assistance (ODA).
This follows the change in policy of the government of President Rodrigo R. Duterte, which prefers a “hybrid” funding scheme, under which the government funds construction through the national budget or ODA, and then bids out the O&M to the private sector.
“The proponent cannot do a feasibility study… We have to renew the feasibility studies for Davao, Laguindingan, Bacolod, Iloilo,” DoTr Undersecretary Manuel Antonio L. Tamayo told reporters on the sidelines of the Philippines-Sweden Airport Collaboration seminar on Nov. 23. Panglao airport is not included “because Panglao will be turned over next year,” Mr. Tamayo said.
When asked about the timeline, Mr. Tamayo said, “We hope by next year.”
He added that the government is giving priority to Davao International Airport, as well as Laguindingan Airport because of demand.
“The priority is Davao, because of investments in Davao. We’re pushing Laguindingan as well, there’s a lot of traffic,” Mr. Tamayo said.
The PPP Center said in 2014 that it intended to bid out the bundled O&M of the airports under a single PPP project.
However, they were unbundled when the Duterte government stepped in.
The government in 2014 awarded Mactan-Cebu International Airport (MCIA) to a joint venture of Megawide Construction Corp. and India’s GMR Infrastructure as a PPP project. — Patrizia Paola C. Marcelo
LOS ANGELES — Russian power puncher Sergey Kovalev got back into the win column on Saturday, making quick work of Vyacheslav Shabranskyy with a second round technical knockout win to reclaim the WBO light heavyweight title.
Kovalev, who was coming off a pair of back-to-back losses to Andre Ward, looked like his old dynamite self in knocking down the Ukraine fighter three times in the first two rounds before the referee stopped it with 24 seconds left in the second at New York’s Madison Square Garden.
Kovalev got himself back in the 175-pound division mix as he finished Shabranskyy off late in the second round. The referee stopped it with Kovalev landing punches at will as a defenceless Shabranskyy stumbled backwards.
“I did it,” said Kovalev, who improved to 31-2-1. “I know that I am back.”
The 34-year-old Kovalev knocked Shabranskyy down for the first time in the fight with a right hand to the head halfway through the opening round. Then with 20 seconds left he connected again with an overhand right followed by a left hook that sent his opponent to the canvas.
Kovalev continued the onslaught in the second, scoring another knockdown with 65 seconds left and then quickly finishing it off.
“It is my goal to be best in this division. The last fight I was stopped and it was an illegal decision by referee. I am ready to fight for all the titles,” Kovalev said.
Now that he has the WBO belt back in his grasp, Kovalev plans to recapture WBA and IBF titles.
He lost all three belts when he suffered consecutive losses to Ward, who then retired leaving the WBO title vacant.
This was also Kovalev’s first fight with his new coach Abror Tursunpulatov whom he hired after firing former trainer John David Jackson. — AFP
WHILE competition in the banking sector is just starting to heat up, the Development Bank of the Philippines (DBP), may be finding itself in a strategic position at a time the government will need lots of funding for its massive infrastructure program.
Late last year, the government formally dropped the plan of the previous administration to merge DBP and another government-owned bank, the Land Bank of the Philippines (Landbank). Instead, the current administration is looking to revamp DBP into an infrastructure bank.
At the same time, DBP, as a universal bank, is also going as far as establishing branches in areas that are either unbanked or underbanked, but have potential for growth. Furthermore, it has partnered with some in the private sector in employing technologies that could widen DBP’s reach even to micro-, small- and medium enterprises (MSMEs) such as mobile, Internet and electronic banking.
Last January, Cecilia C. Borromeo was elected by DBP’s board of directors as its new president and chief executive officer after 27 years at Landbank, where she was executive vice president and officer-in-charge prior to her transfer.
For this quarter, BusinessWorld interviewed Ms. Borromeo to give us a picture of what DBP is doing right now, its accomplishments and plans moving forward.
You were with Landbank for 27 years. How was your job then and now, from being a veteran especially in agribusiness, to heading DBP, which can possibly become an infrastructure bank?
My experience with Landbank is not that different from what I have been doing here in DBP.Landbank’s portfolio, after all, is very similar to DBP and includes small to large complex projects. Also, the rules of credit management in DBP and Landbank are practically the same — as long as risks are identified, the appropriate credit facilities can be provided to different types of clients.
My marching order is to help concretize the development vision of the National Government for the country. Taking my cue from the government’s pronouncement of ushering in a “golden age of infrastructure” for the country, my vision for DBP is to transform it primarily into an infrastructure financing bank. The challenges encompass those of helping build the infrastructure that our country sorely needs as a launching pad for greater economic growth. Ultimately, economic growth will translate to the creation of more jobs and opportunities for our people.
How are the Bank’s financial operations during the quarter?
We have been performing very well this year. As of end of September 2017, our net income is at P3.98 billion, or an increment of 30% from the P3.07 billion for the same period last year.This can be attributed to the increase in interest income on loans or 19% in view of the growth in portfolio.
Total assets have increased to P557.84 billion from P492.54 billion, or a 13.26% growth mainly due to the growth in loans and deposit levels.Our deposits have jumped by 15% from P319.39 billion to P367.32 billion.
Our capital adequacy ratio is at a healthy 15.5%.
We’ve also done a solid job of managing our costs.
With around 80% of the loan portfolio allocated for infrastructure projects, how do you find the risks and returns for this segment?
Let me clarify first that we’re not mandated to allocate 80% of our loan portfolio for infra projects.
I believe we’ve gained enough knowledge in identifying risk and reward areas with the Bank’s many years of experience in lending to infrastructure projects.This includes power projects, farm to market roads, toll roads, ports and airports, vessels, water and electricity distribution utilities, power plants at the national and local government unit levels.
We also have the experience in packaging the appropriate credit programs and facilities and in keeping a high-quality portfolio that can generate a steady stream of income for the Bank.
As new types of project structures are developed by government and private sector participants in the BBB program, e.g. hybrid PPP (public-private partnerships), the Bank is prepared to meet the challenges of financing them.
Another possible aspect of being an infrastructure bank is in the funding side; DBP may look into less traditional sources or means of financing infra projects such as bonds.
How is DBP adjusting to the changing needs of the market? What trend has been observed among your clients in the last 10 to 20 years?
We’ve done a creditable job of adapting to the changing needs of the market especially this year. We’ve been very active in launching nontraditional channels like mobile banking and Internet banking.In fact, we’ve partnered with the Bureau of Internal Revenue (BIR) recently to launch the PayTax Online portal to enable individuals to pay taxes online.
We’ve also launched credit and debit cards for Pag-IBIG (Home Development Mutual Fund) members and SSS (Social Security System) employees.
But there are still a lot of things to be done. We need to put up more branches to serve the unbanked, including clients in the island-provinces.
In news reports, government is looking to make DBP into an infrastructure bank amid the drive for its “Build, Build, Build” program. How will this be different from the Bank’s current mandate as a development bank?
Financing infrastructure projects isn’t something new to DBP. In DBP’s umbrella program — the Connecting Rural Urban Intermodal Systems Efficiency (CRUISE) Program — aims to support investments that improve the country’s primary transport infrastructure and logistics facilities to provide affordable, reliable and safe mass transport systems; support the efficient movement of basic commodities; bring down the costs of goods and services; and introduce sustainable storage, handling and distribution technologies.
But I think there must be a metric to measure our performance as an infra bank. Of course, loans will be the main metric but it doesn’t need to be the only way to measure our performance. Other metrics may be on the funding side; financing the highest impact projects; capability of people; complementation with subsidiaries so that all subs also reflect in their operations the infra bank mandate.
How did competition in the local banking scene change following the entry of more foreign banks? Would you say that the Bank was affected by this development?
Consolidation among local banks is becoming more apparent with the entry of more foreign banks.Size matters, especially in this very competitive field.
However, in the case of DBP, I believe that the foreign banks cater more to their nationals.As such, DBP is not really fazed by competition as the local borrowers will still approach their local banks. And being a government bank, DBP has the solid reputation and track record behind it.Being a development financing institution is also a niche in itself.
What’s your position (or the Bank’s position) on the move for further integration among the ASEAN’s (Association of Southeast Asian Nations) financial sectors? How will the Bank look to benefit from this?
Financial integration is aimed at facilitating intra-ASEAN trade and investment by increasing the role of ASEAN indigenous banks and having a more integrated insurance and capital markets. These will be supported by a robust financial market infrastructure that is safe, cost-efficient and more connected.
There is huge opportunity for the Philippines’ trade and investment programs with an ASEAN market of over 1.9 billion people.
The regional integration will offer a lot of opportunities for Philippine banks as well as regional banks. First, local banks will gain greater access to the ASEAN financial market which has more than 600 million people.There’s the opportunity to capture the high amount of savings in the ASEAN. Of course, there is the concern that more foreign banks will threaten local banks, but this should also challenge Philippine banks to improve themselves.
The introduction of new technologies and best practices should push local banks to work double time in providing the best products and services to Filipinos.
What is DBP’s comparative advantage compared to the big private (local and foreign) banks? How do you see DBP’s role in an ever-changing financial landscape where bank consolidations occur?
I think we have four advantages over other big private banks.
First, DBP has a clear mandate — to support the infrastructure buildup of the government as well as to assist critical industries and sectors such as SMEs. As is clearly stated in the Revised Charter of DBP, the primary purposes of the Bank shall be to provide banking services principally to service the medium and long-term needs of agricultural and industrial enterprises, particularly in the countryside and preferably for small and medium-scale enterprises.
Second, DBP benefits from being a government bank. People trust us because one, we’re stable and two, we’re part of the government.
Third, we have access to government deposits. In fact, we just increased our government deposits from P219 billion in the third quarter of 2016 to P271 billion in the third quarter.
And fourth, we have access to Official Development Assistance Funds (ODAs) which are not readily available in the market.
DBP is the bank of choice for our many development partners.In fact, we can say that DBP stands for Development by Partnership. We are a founding member of the Association of Development Financing Institutions in Asia and the Pacific.DBP is a member of the World Federation of Development Financing Institutions. We engage in the active exchange of ideas with our international counterparts in the development financing field.
With moves towards regional integration for the banking sector, what steps have been taken (and are planning to be taken) to push forward the creation of an Islamic banking framework here?
BSP feels that the best way to move Islamic banking forward is to have appropriate legislation in place.It has drafted a proposed law amending the [Al-Amanah Islamic Investment Bank of the Philippines’] charter and creating an Islamic banking system. The bill, which has been filed in the House of Representatives, aims to create an expanded Islamic banking system and address constraints including the issue on taxation. At present, a technical working group is coordinating with Congress on the passage of amendments to the Amanah charter.
What are your plans for 2018?
We will be adapting a new organizational structure — that will be the big change.We have to keep on innovating our processes, enhancing our products, updating our policies, to transform DBP into one that is more responsive to the needs of our stakeholders.
Next year, we will grow the Bank’s loan portfolio and we will be quite aggressive and ambitious. We are looking at least 20% growth in loan portfolio.Deposits will have to grow at almost the same rate as well. On the deposit-taking side, it will be a very challenging job for the branches because as we expand the deposit base, we also will reduce the average cost of our funds.
That’s quite a challenge but I find the DBP officers and personnel, in general, creative and innovative, and more importantly, they know their customers. They are a very dedicated work force and I’m pretty sure they will rise up to the challenge and increase the balance sheet of the Bank.
How do you see DBP 10 years from now?
By the next decade, we should have doubled our size and profits.We are targeting to become a trillion-peso asset bank with minimum earnings of P10 billion.
As a bank, we have to be always competitive, bringing DBP at par with other industry players.Especially as we are a state-owned bank, we have to continuously strive to surpass the performance yardsticks by which the market measures other financial institutions, while meeting the requirements and expectations of our main constituents and stakeholders. This complements our vision that by the end of 2022, on DBP’s 75th anniversary, we will have doubled our size and profits, to become a trillion peso-asset bank with minimum earnings of P10 billion.
BANANA INDUSTRY output is recovering to near 2012 levels, and growers believe they may be in position to compete again in traditional export markets with some help from the government in negotiating lower tariffs.
“We are recovering in volume production. No estimates yet but I believe it will be higher than last year,” Pilipino Banana Growers and Exporters Association, Inc. (PBGEA) Executive Director Stephen A. Antig said in an e-mail interview.
Mr. Antig noted that the industry has been losing ground since 2012 as banana producers in Latin America have been encroaching into traditional markets such as Japan, China, South Korea, New Zealand and the Middle East.
He also noted that big markets such as Japan have granted competitors market access without duty while Philippine bananas are levied an 8.4% tariff during the off-season for Japanese fruits. An 18.4% tariff is levied in season.
“To regain our market share we will produce and export more bananas with the highest quality we can muster,” Mr. Antig added.
The Philippine Statistics Authority (PSA) said banana output in 2016 was 4.64 million metric tons (MT).
The 2016 output closely matches 2012’s 4.69 million MT, just before Panama disease and typhoon Pablo (international name: Bopha) hit banana farms, pulling down output to 4.23 million MT in 2013.
PBGEA is also looking forward for government assistance in easing trade barriers, with talks expected to start next year.
The PSA estimates that the value of banana exports in 2016 was $617.53 million on a free-on-board (FOB) basis, down 6.1%.
During the first nine months of 2017, exports declined 0.4% to $488.84 million FOB.
In September, banana exports fell 38.7% to $58.73 million.
“This encroachment into our markets have been raised with the Departments of Agriculture (DA), Trade (DTI) and Finance (DoF). DA and DTI informed us that tariff issues will be taken up next year in the first quarter,” Mr. Antig said. — Janina C. Lim
DAVAO CITY — The first batch of more than 9,000 cases containing 4.748 million packs of seized cigarettes with brands sold by Mighty Corp. were destroyed Sunday, Nov. 26, at the Holcim Philippines geocycle plant here.
The cigarettes, which formed part of the evidence in one of the three complaints filed by the Bureau of Internal Revenue (BIR) against the company, were confiscated in a joint operation in March this year by the BIR and the Bureau of Customs (BoC) in a warehouse in General Santos City leased to Mighty Corp.
The almost five million packs of cigarettes, worth an estimated P142.44 million, were confiscated for having counterfeit tax stamps.
The estimated deficiency excise tax liability of the seized cigarettes is P1.39 billion including penalty, according to the BIR.
“The decision to destroy these confiscated cigarettes came easily. We imposed sin taxes on these products in part to protect the health of our people. It would be wrong to release these products to the market,” said Finance Secretary Carlos Dominguez G. III in his remarks read for him at the event by Assistant Secretary Kelvin Lee of the Office of the Executive Secretary.
Mr. Dominguez said the destruction of the seized cigarettes “is intended to deliver this message: tax evasion does not pay. We will confiscate the offending products and destroy them. No one will profit from the commission of a crime.”
Besides this batch, the government is also set to destroy 66,245 cases of Mighty cigarettes confiscated in San Simon, Pampanga, another 163,183 cases in San Ildefonso, Bulacan and other smaller stockpiles confiscated in Tacloban City and Cebu. These seized cigarettes were also used as evidence in the complaints filed before the DoJ.
The complaints against Mighty had since been withdrawn after the company, with main headquarters in Bulacan, offered last July to settle its tax liabilities with the government for P25 billion and shut down its operations.
Mighty Corp. subsequently sold its assets to Japan Tobacco International to help pay off its tax arrears.
Mr. Dominguez has said the government stands to gain over P30 billion in additional revenues from Mighty’s tax settlement once the value-added tax from the sale and other fees are paid. He said this makes the tax settlement the largest sum ever paid by a single corporate entity in the country’s history.
According to Holcim Philippines, the “co-processing” method it uses for the destruction ensures the total thermal destruction of waste materials, reduces toxic gas emissions and land and groundwater pollution. — Maya M. Padillo
WE ALWAYS want what we can’t have; and the good ones always run away.
Margarita Cojuangco-Zini, once known on the society pages as Mai Mai Cojuangco, disappeared from the Manila social scene dominated by her mother, the socialite Margarita “Tingting” Cojuangco, after her marriage to an Italian businessman, Andrea Zini. Ms. Cojuangco now makes a reappearance in a totally different capacity: the pretty young woman who once graced magazine covers now stays in the background as a bag designer for a brand culled from her and her grandmother’s shared name, Demetria.
And not just any bags, mind you. Her last collection only had 24 pieces, which were immediately snapped up by power women. Her pieces this year, which debuted at a hidden boutique called Ideé in Makati, only numbered nine. By the time this reporter arrived, only three bags remained in the store, and thus, on the market.
“It’s certainly not a disadvantage,” said Ms. Cojuangco-Zini, when asked how the Cojuangco name weighed over her when she entered the fashion world. Aside from her mother being a socialite, her father is Jose Cojuangco, Jr., a politician, who is in turn the brother of the late President Corazon Cojuangco Aquino. This then makes her the cousin of both former President Benigno Aquino III and his celebrity sister Kris Aquino.
About her stylish mother, she said, “I think I’ve appreciated style.”
“Only she can wear the clothes that she wears. Maybe a lot of the clothes I wear, she can’t get away with. I think that’s what style is. It’s not about following what the bloggers wear; it’s about finding what is ‘you.’”
Her bags are designed in Italy and made by four artisans in a small, all-female studio in Florence.
While bag designing seems like a hobby for young socialites, Ms. Cojuangco-Zini takes design seriously — she was a graphic designer for 20 years. Her experiences living, studying, and working in Florence — where she lives with her husband and daughter — inspire her bags. Her bags take the shape of beans and buckets, with scarves serving as bag closures. Ms. Cojuangco assures us that the bags are all unique, maybe with a variation in stitching, in colored details, and the scarves. “You hardly ever find the same scarf twice. And I’m not interested, in any case, getting the same scarf,” she said.
The bags cost upward of P60,000.
The Bucket comes in fuchsia, chartreuse, and cerulean accented with a brown stripe, and in bone white. It may be used as a handbag or shoulder bag. In each a vintage scarf has been hand-cut, sewn, and attached to the bag. Ms. Cojuangco-Zini selected each designer scarf from vintage shops and personal collections in Florence.
Meanwhile, the Demi is a diminutive purse that is made up of an astounding 50 leather pieces cut and constructed to shape a strikingly minimal piece. It comes in red, blue, and black.
As a once-fixture on Manila’s social scene, one would think that every launch is simply a party, and perhaps, friends of hers with money to burn simply buy the bags as a favor to her. Not so much.
“Women who buy my bags know that they’re buying quality, and they’re buying unique pieces,” she said. “These are women who have other bags — they have Gucci, Chanel, Hermes… Most of the time, I don’t even know them. They’re not friends. They’re not going to spend this money to do me a favor.”
“You spend money that’s hard-earned, and I give you something that only you have. It’s like a piece of art,” she said. “You won’t find an artist who will make the same painting twice,” she said, commenting on the unique nature of each bag.
A fashion designer’s success is usually measured by how well their bags are imprinted on the consumer’s consciousness, usually by their ubiquity. The Chanel 2.55, the Hermes Kelly: every rich and famous woman in the world has one on their elbow crook or shoulder. With one-offs, how can Ms. Cojuangco say she’s a success? In a low voice, almost like a whisper, she said her secret.
“Isn’t that what’s beautiful about it? I think exclusivity, and knowing that only you have it is quite attractive. Don’t people want things that only they can have? That other people can’t have — only you do? Do you want something that everybody can have? I think it’s quite sexy, right?”
The Idée Clothing Store is located at 2263 Pasong Tamo Ext., Makati City and is open weekdays from 10 a.m. to 6 p.m. and on Saturdays by appointment. For details call 833-9763 or follow them at @ideeclothingstore. — Joseph L. Garcia
