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Gas deposits, LNG exploration pushed

MALAMPAYA GAS FIELD — PHILSTAR FILE PHOTO

THE PHILIPPINE government should boost its efforts to explore gas deposits and develop the importation of liquefied natural gas (LNG) to compensate for the Malampaya gas field’s depleting reserves, according to a Philippine senator.

“We have to really further explore development of liquefied natural gas, and I hope we can find more deposits around the country,” Senator Joseph Victor G. Ejercito told a news briefing.

He said exploring more local energy sources is crucial since coal, diesel, and other traditional forms of fuel are spiking in prices globally due to geopolitical tensions such as the war in Gaza.

The Philippines is hard-pressed to find other sources of indigenous energy as the Malampaya gas field, which supplies a fifth of the country’s power requirements, nears depletion.

The gas field is expected to run out of easily recoverable gas using current techniques by 2027.

Manila plans to raise the share of renewable energy in the country’s energy mix to 35% by 2030 and to 50% by 2040 from the current 22%.

Senators are set to continue deliberations on a bill a bill seeking to promote the production of indigenous natural gas and LNG, which the government sees as a transition fuel towards adopting more renewable energy sources.

The chamber is currently on break and will resume session in November. — John Victor D. Ordoñez

CoC filing clash kills 1, wounds 4 in Shariff Aguak

COTABATO CITY — Local officials have tightened security in Shariff Aguak, Maguindanao del Sur after a community watchman was killed while four others were hurt in a clash on Tuesday between residents and group of a supposed vice mayoral candidate who failed to file candidacy due to legal constraints.

Lt. Col. Regie G. Albellera, chief of the Shariff Aguak Municipal Police, and officials of the Police Regional Office-Bangsamoro Autonomous Region, confirmed on Wednesday that a member of a Barangay Peacekeeping Action Team, who was hurt in the incident, died at a hospital at past 7 p.m., Tuesday.

Local officials told reporters the incident left Col. Montassir Eskak of the 1st Provincial Mobile Force Company of the Maguindanao Provincial Police Office, a resident of Shariff Aguak, and two others in the group that provoked the hostilities, wounded.

Police and military officials said the incident erupted after the municipal office of the Commission on Elections failed to approve the candidacy for vice-mayor of a Maguindanaon man who only showed a certificate of nomination and acceptance from a political party, which cannot be used as a basis for the filing of his certificate of candidacy.

The vice mayoral aspirant, whose group figured in the hostilities, had eventually filed a CoC at the Comelec regional office in Cotabato City, according to PRO-BAR officials. — John Felix M. Unson

3 alleged NPA rebels captured in Apayao

BAGUIO CITY — Three alleged high-ranked New People’s Army (NPA) rebels were captured by soldiers and policemen in barangay Manag, Conner, Apayao on Tuesday.

The capture of the three alleged key members of the Regional Guerilla Unit/Regional Operations Command (RGU/ROC) of the Ilocos-Cordillera Regional Committee (ICRC) of the CPP-NPA by the Philippine Army’s 503rd Infantry Brigade acted on a tip from a concerned civilian about the presence of armed NPA terrorists in the area.

Government forces launched patrols in the area and intercepted the three identified as “Ka Sam,” alleged Commanding Officer of the Regional Sentro De Grabidad (RSDG) of the ICRC, “Ka Tanya, alleged Political Instructor and “Ka Annie,” organizer and head of education of the Kilusang Larangang Gerilya (KLG) codenamed “Baggas” or Kalinga guerillas front.

Two M16A1 rifles with ammunition, hand grenades, explosives, and personal belongings were reportedly seized from the trio and are now in the custody of authorities for further investigation.

Major General Gulliver L. Señires, Commander of the Philippine Army’s 5th Infantry Division, said “the capture of these high-ranking NPA leaders is a significant step toward dismantling the remaining guerilla fronts in Northern Luzon.”

He added their capture “demonstrates that the people are increasingly rejecting the NPA’s violent ideology and supporting the government’s efforts to achieve lasting peace and development in the region.” — Artemio A. Dumlao

Shares decline further as peso sinks to P57 level

BW FILE PHOTO

PHILIPPINE STOCKS dropped further on Wednesday as investors continued to book profits and with the peso closing at the P57 level for the first time in almost two months.

The bellwether Philippine Stock Exchange index (PSEi) dropped by 1.49% or 112.73 points to 7,424.52 on Wednesday, while the broader all shares index lost 1.08% or 44.05 points to end at 4,033.36.

“The local market extended its decline this Wednesday as investors continued with their profit taking,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

“The local currency’s weakening against the dollar also contributed to the market’s drop,” he added.

On Wednesday, the peso closed at P57.02 per dollar, dropping by 11.50 centavos from its P56.905 close on Tuesday, based on Bankers Association of the Philippines data.

This was the peso’s weakest finish and was the first time it ended at the P57 level against the dollar in nearly two months or since it closed at P57.245 on Aug. 16.

“Philippine shares succumbed to profit taking after briefing touching the 7,600 level at overbought territory as investors gear up for the US consumer price index. Markets found little relief in easing oil prices, which were countered by ongoing Middle Eastern tensions,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

The PSEi on Monday hit an intraday high of 7,604.61 before closing at 7,554.68, which was its best finish since January 2020.

“Investor enthusiasm waned as expectations grew that the Federal Reserve may slow future rate cuts due to a robust labor market. Oil prices dropped on Tuesday as the rally spurred by rising geopolitical tensions came to a halt, with the market awaiting Israel’s response to Iran,” Mr. Limlingan added.

Hezbollah militants targeted Israeli soldiers near the Lebanese border village of Labbouneh with artillery shells and rockets on Wednesday, the group said, a day after Israel said it had killed two successors to its slain leader, Reuters reported.

All sectoral indices closed lower on Wednesday. Holding firms retreated by 1.77% or 113.44 points to 6,281.47; mining and oil dropped by 1.71% or 153.66 points to 8,823.72; financials went down by 1.68% or 40.38 points to 2,359.54; services decreased by 1.64% or 38.69 points to 2,318.38; industrials shed 0.7% or 70.21 points to close at 9,965.01; and property slipped by 0.53% or 15.86 points to 2,934.74.

Value turnover declined to P5.3 billion on Wednesday with 917.06 million issues traded from the P7.39 billion with 1.22 billion shares changing hands on Tuesday.

Decliners outnumbered advancers, 122 versus 72, while 64 names were unchanged.

Net foreign selling stood at P402.75 million on Wednesday versus the P428.08 million in net inflows recorded on Tuesday. — R.M.D. Ochave with Reuters

Peso sinks to P57 level

PHILIPPINE STAR/WALTER BOLLOZOS

THE PESO sank back to the P57 level on Wednesday as markets expect the US Federal Reserve to deliver smaller rate cuts for the rest of the year and due to safe-haven demand for the dollar amid the ongoing conflict in the Middle East.

The local unit closed at P57.02 per dollar on Wednesday, dropping by 11.5 centavos from its P56.905 finish on Tuesday, Bankers Association of the Philippines data showed.

This was the peso’s worst close in close to two months or since its P57.245 finish on Aug. 16.

The peso opened Wednesday’s session slightly stronger at P56.888 against the dollar. Its intraday best was at P56.87, while its weakest showing was at P57.06 versus the greenback.

Dollars exchanged went down to $1.58 billion on Wednesday from $1.897 billion on Tuesday.

“The local currency closed above the P57 level anew from the combined effect of dollar safe-haven demand emanating from the escalating tensions in the Middle East [and] growing market expectations of a softer US rate cut of 25 basis points (bps) in November,” a trader said in an e-mail.

The dollar was generally stronger against Asian currencies on Wednesday amid cautious signals from Fed officials, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort added in a Viber message.

Trading at the foreign exchange market was cautious on Wednesday as the market awaited the release of minutes of the Fed’s September meeting and September US consumer price index data, a second trader said by phone.

For Thursday, the first trader sees the peso ranging from P56.85 to P57.10 per dollar, while the second trader expects it to move between P56.70 and P57.10.

For his part, Mr. Ricafort said the local unit could trade from P56.90 to P57.10.

The US dollar nudged up against most currencies and hit a new two month high on a basket of peers, Reuters reported.

With markets turning less certain on Fed cuts while still pricing in easing elsewhere, the dollar index touched 102.7, its highest since Aug. 16. It was last up 0.17% at 102.64.

Investors now have about an 85% chance of a quarter-basis-point reduction priced in, reflecting a slim probability the Fed will leave rates unchanged, the CME FedWatch tool showed. — Aaron Michael C. Sy with Reuters

Infrastructure budget to decline as gov’t counts on more PPPs

PHILSTAR FILE PHOTO

THE infrastructure budget could fall slightly next year with the government counting on public-private partnerships (PPPs) to play a bigger role in funding, the Department of Budget and Management (DBM) said.

For 2025, the proposed budget for infrastructure is P1.507 trillion, down 0.3% from funding levels in 2024.

The final infrastructure budget is still subject to approval from Congress. Senators are currently preparing their version of the General Appropriations Bill.

“While (next year’s budget) is 0.3% lower than this year’s infrastructure budget of P1.510 trillion, the National Government (NG) anticipates that this will be bolstered by the increase in private sector investment through the recent enactment of the PPP Code and the issuance of its Implementing Rules and Regulations (IRR),” the DBM said.

Republic Act No. 11966 or the PPP Code streamlined the framework for all PPPs at the national and local levels. Its IRR became effective on April 6.

The DBM also noted that the bulk of the 170 PPP projects in the pipeline are infrastructure-related.

Budget Secretary Amenah F. Pangandaman noted that infrastructure development will remain a key priority of the administration, which is consistent with the government’s medium-term fiscal framework.

The government’s P1.51 trillion allocation for infrastructure this year is equivalent to 5.7% of gross domestic product (GDP).

This budget also covers subsidy or equity components for state-owned corporations and transfers to local government units, the DBM said.

In the first six months of the year, the NG’s infrastructure spending jumped 12.5% year on year to P124.9 billion.

The government aims to spend 5-6% of GDP annually for infrastructure through 2028. — Beatriz Marie D. Cruz

Merchants urged to stay innovative as retail competition intensifies online

PHILSTAR FILE PHOTO

By Justine Irish D. Tabile, Reporter

SINGAPORE — Retailers in Southeast Asia need to innovate to remain competitive in online shopping as consumer preferences evolve, electronic commerce (e-commerce) platforms said.

At Tech Week held at Marina Bay Sands, Shopify Country Head for Southeast Asia and India Bharati Balakrishnan said that 52% of shoppers from the region prefer to shop online.

“I know it’s not like way over 50%, but this shift, I promise you, is happening much faster in these (Southeast Asian) markets than elsewhere,” she said.

The Shopify Southeast Asia Retail Report 2024 revealed that online shopping continues to be the preferred channel for shoppers in the region. The finding was reached in a survey of 2,056 consumers from Indonesia, Malaysia, Singapore, and the Philippines.

The report also found that one in four of those surveyed equally enjoy shopping online and in-store, while only 19% said they prefer to shop offline.

Ms. Balakrishnan said the critical point of e-commerce is not about how much shoppers buy online, but where they start their journey.

“The question is, what (are retailers) doing to create consumer behavior that offers the best experience when it comes to touching their brand for the first time,” she said.

The report, which also surveyed 269 leaders of retail businesses, found that 66% of retailers are planning to increase technology investment in unified commerce in the next 12 months.

“I think there is a deep understanding of not wanting to compete with a platform, but to really get your existing customer to buy more from you on your platform,” she added.

Shopify said it is important for retailers to realize the importance of physical storefronts and creating seamless shopping experiences.

“To succeed, a unified commerce infrastructure is key, providing a holistic view of customer engagement, inventory, and fulfillment across channels,” it added.

However, Shopify noted that while businesses understand the importance of prioritizing omnichannel tools, they tend to invest less in actual in-store experiences, which is viewed as detrimental because consumer expectations have been raised.

In the report, 67% of the businesses said that they plan to invest in e-commerce systems to drive growth this year, while fewer leaders said they will prioritize investment in new physical stores (51%) and enhancing the in-store experience (56%).

In the Philippines, 80% of the shoppers named free shipping as their top consideration when shopping online, while 66% cited knowledgeable staff as a must when shopping in brick-and-mortar stores.

Separately, TikTok Philippines Fashion Category Lead Jonah Michael Ople said that small businesses should leverage livestreaming to drive growth as the platform is becoming a major source of sales for big brands across the region.

He said that the top sellers among the 2 million registered sellers on the platform are seeing 80% of their sales generated by live selling.

“The small enterprises can take advantage of this because they are the ones who will benefit most from this kind of platform,” Mr. Ople told reporters.

During his presentation, Mr. Ople said sellers from Indonesia, Malaysia, Singapore, Thailand, the Philippines, and Vietnam saw a 37% quarter-on-quarter increase in sales from live selling in the three months to September.

Meanwhile, TikTok Shop also posted an 18% year-on-year increase in daily average livestream sessions in the first six months.

Nevertheless, he said many sellers, especially micro, small and medium enterprises, still do not know how to make use of livestream shows.

“Even big brands, sometimes, are having trouble mounting such an event, much less mounting it every day,” he said.

“What we are saying is that we just need to guide them through how to do it the first time, and then everything will grow,” he added.

However, he said that sellers must know the right mix to get the best out of their resources.

“You really need to know what your target market wants to see, and it differs from brand to brand, from region to region,” he added.

In the Philippines, he said the top categories for live selling are fashion, beauty, lifestyle, and electronics, reflecting the broader retail landscape.

“The Philippines is a big market (for live selling) mostly because people find ways to connect online. But what makes us special is that I think we have a penchant for entertainment,” he said.

“The Philippines is very well known for singing and dancing, and that is part of what TikTok is about. I think Filipinos have very easily adopted the trends on TikTok,” he added.

NEA likely to miss 2024 electrification target

THE National Electrification Administration (NEA) said it will fall short of its 2024 target to electrify 91% of all households, citing inadequate funding.

“Based on the available budget for fiscal year 2024, we will not be able to achieve 91% electrification, but we will only attain 89.36% household electrification rate,” NEA Administrator Antonio Mariano C. Almeda told a Senate budget hearing on Wednesday.

“Assuming funding is not increased, the NEA will be hard-pressed to achieve 100% electrification by 2028,” he added.

The NEA is primarily responsible for rural electrification, bringing electricity to missionary or economically unviable parts of the countryside.

The government hopes to achieve total electrification by 2028.

In the proposed 2025 budget, the NEA is seeking funding of P23.77 billion, including P19.66 billion for electrification projects.

The requested funding is intended to support energization of more than 3,000 sitios, reliability improvement projects, line enhancement of some barangays, installation of nearly 250,000 solar home systems, and rehabilitation and reconstruction of calamity-stricken distribution facilities of electric cooperatives.

Citing the evaluation of the Department of Budget and Management, Mr. Almeda said that the level of subsidy was reduced to P1.86 billion or only 9% of those proposed, which covers the energization of only 594 sitios and four barangays, while procuring 3,700 solar home systems.

“The biggest challenge in the attainment of 100% rural electrification is the inadequate government subsidy to finance the energization of the remaining unenergized areas,” Mr. Almeda said.

Meanwhile, Energy Undersecretary Rowena L. Guevara said that the department will soon be issuing the terms of reference for the upcoming green energy auctions (GEA).

GEA-3 involves geothermal, pumped storage hydro, run-of-river hydro, and impounding hydro projects with a total capacity of 4,399 megawatts (MW).

The GEA program aims to promote renewable energy as a major source of energy through competitive selection. Renewable energy developers compete for incentivized fixed power rates by offering their lowest price for a certain capacity.

“We’re going to be issuing the terms of reference soon… the performance or non-performance of projects will be included,” Ms. Guevara said.

GEA was first conducted in 2022 and attracted 1,966.93 MW worth of bids for renewables, while GEA-2 was held in 2023 and resulted in the award of 3,440.76 MW. — Sheldeen Joy Talavera

IP use by political campaigns could reveal candidates’ integrity, IPOPHL says

PHILSTAR FILE PHOTO

THE Intellectual Property Office of the Philippines (IPOPHL) said the use or misuse of intellectual property (IP) by political campaigns should reveal to voters whether candidates can act with integrity.

“Candidates’ respect for IP rights is a litmus test of their integrity and trustworthiness as future public servants,” IPOPHL Director General Rowel S. Barba said. 

“I don’t think any voter would like to see any copyright owner and artist, especially their favorite artists, deprived of their right to have a say on the use of their work for a political campaign,” he added.

IPOPHL said that candidates have enough time to seek permission from artists “before transforming their works into catchy campaign jingles, slogans, and merchandise to build their political brand.”

The campaign period officially starts next week.

Mr. Barba said that non-compliance may result copyright infringement lawsuits.

IPOPHL Bureau of Copyright and Related Rights Director Emerson G. Cuyo said that the candidates may contact accredited collective management organizations (CMOs) to secure the licenses for the transformation and public performance of works.

“(CMOs) could help facilitate negotiations and licensing arrangements for the transformation, use, or public performance of songs and music, which are the most common types of copyrighted work transformed for local political campaigns,” he added. — Justine Irish D. Tabile

ADB Laguna lakeshore loan expected soon

THE Asian Development Bank (ADB) said it expects to approve $1.2 billion representing the first tranche of the Laguna Lakeshore Road Network (LLRN) project loan before year’s end.

“We are in the last stages of having the Laguna Lakeshore Road Network Project presented to our board for approval,” ADB Country Director for the Philippines Pavit Ramachandran told reporters on the sidelines of an event on Monday.

“We’re looking to have the Laguna Lakeshore Road Network approved later this year.”

Other funders are the Export-Import Bank of Korea ($904.35 million) and the Asian Infrastructure Investment Bank ($188.18 million).

Targeted for completion by 2027, the LLRN consists of a 37.5-kilometer primary road and a 12.0-kilometer viaduct connecting Lower Bicutan, Taguig and Tunasan, Muntinlupa.

It includes a 25.5-kilometer shoreline viaduct and embankment from Tunasan to Calamba, Laguna, and connecting roads to other towns in Laguna.

The LLRN is expected to improve road connectivity from the capital region to areas directly south of it, boosting economic activity in the area.

The ADB will also approve a $500-million contingent disaster facility this year, a stand-by fund that would allow provide access to emergency funds during calamities.

Also for approval this year is a $500-million loan to support public financial management reforms.

For 2025, the ADB is supporting the construction of the Metro Rail Transit Line 4 (MRT-4) as well as flood management projects nationwide. 

“We will be supporting the MRT-4 next year. We have a number of flood disaster resilience projects in several river basins…Tagum, Abra, other river basins in Mindanao and Luzon and other areas.”

The government is seeking a $1-billion loan from the ADB to help fund the MRT-4. It is also proposing $537.4 million in loans from the AIIB.

The MRT-4 is a 10-station commuter railway of about 12.7 kilometers from the Epifanio de los Santos Avenue (EDSA)-Ortigas Ave. junction to Taytay, Rizal. It is expected to serve more than 400,000 passengers daily.

Also up for approval is the $500-million Climate Change Action Program, which would support the transition to a climate-resilient and low-carbon economy.

ADB loans to the Philippines are expected to hit at least $24 billion until 2029, according to the bank’s Country Partnership Strategy.

“Our Country Partnership Strategy is really very focused on supporting the Philippines in its efforts to intensify climate action… Primarily, I think the focus here is on climate resilience and climate adaptation,” Mr. Ramachandran said. 

The ADB is also assisting the government in identifying new public-private partnership projects, and is helping the Bangsamoro Autonomous Region in Muslim Mindanao in drafting its own revenue code, he added. — Beatriz Marie D. Cruz

ERC on track to complete rate reset for grid operator

THE Energy Regulatory Commission (ERC) said it is on track to complete the rate reset process for the National Grid Corp. of the Philippines (NGCP).

At a Senate budget hearing on Wednesday, ERC Commissioner Catherine P. Maceda said the commission is preparing to publish the final draft determination for the NGCP’s fourth regulatory period (RP) within the month.

“We are outlining the draft final determination and hopefully that can be posted within this month,” Ms. Maceda said.

The rate reset process is usually a “forward-looking” exercise that requires the regulated entity to submit forecast expenditures and proposed projects over a five-year regulatory period. The ERC assesses the actual performance of the entity and adjusts rates as needed.

The fourth regulatory period covers the years 2016 to 2022, and includes the lapsed period of two years.

According to the ERC, the 4th RP is “unique because it covers a past period, thus requiring evaluation of historical data on NGCP’s expenditures and performance.”

In November, the ERC capped the revenue that the NGCP is allowed to generate at P36.7 billion a year, well below the annual average of P77.56 billion it applied for Phase 1, based on the commission’s partial initial determination.

The draft final determination will be posted to allow for public comment, Ms. Maceda said.

“The commission will review (the public comment) before deciding on the final determination,” she said. — Sheldeen Joy Talavera

S. Korea trade deal seen producing import tariff savings of up to 30%

REUTERS

PHILIPPINE IMPORTS from South Korea across more than 600 tariff lines are expected to realize tariff savings of up to 30% once the Philippines-South Korea free trade agreement (FTA) takes effect, the Department of Trade and Industry (DTI) said.

DTI Export Marketing Bureau Director Bianca Pearl R. Sykimte added that the deal features substantial Philippine concessions on South Korean motor vehicle parts.

“Korean exports for these products amount to more than $300 million,” Ms. Sykimte said on the sidelines of the Philippines-Korea Business Forum at the Manila Hotel on Monday.

“Importers of these products will benefit from additional tariff savings of about 3%-30% compared to what were provided under the ASEAN-Korea FTA and Regional Comprehensive Economic Partnership (RCEP),” she added.

She said that the impending bilateral FTA will also benefit exporters of banana, canned pineapple and pineapple juice, avocado, guava, papaya, okra, tuna, oysters, blue crab, and octopus, among others.

“The tariffs of these products under the ASEAN-Korea FTA and RCEP are 3%-27% higher compared to those negotiated under our bilateral FTA,” she said.

Aside from market access, she said that the FTA will also allow for economic and technical cooperation between the two countries to strengthen trade, investment, and economic relations.

“Both sides agreed to cooperate in various areas, including industry development, innovation, creative and cultural industries, intellectual property standards, and e-commerce, among others,” she said.

She said that the cooperation may be in the form of information exchange, sharing of best practices, human resource development, exchange of experts, trade and investment promotion, technical assistance, and transfer of technology.

Meanwhile, she said that the Export Development Council is still working on the recalibration of the Philippine Export Development Plan (PEDP).

“We hope that it will come out before the end of the year … because we are still discussing internally the things we need to consider,” she said.

“But still, we are optimistic that we will meet the Philippine Development Plan (PDP) target,” she added.

The PEDP projects merchandise and services exports for 2024 of $143.4 billion, much higher than the $107-billion export target under the PDP.

The Philippine Statistics Authority reported that goods exports in the first seven months amounted to $42.66 billion, a 2.6% increase from a year earlier. — Justine Irish D. Tabile

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