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Inflation expected to have eased further in June

THE general year-on-year rise in prices of widely used goods and services likely eased further in June from May due to lower fuel and electricity costs, the Bangko Sentral ng Pilipinas (BSP) announced on Friday.

“The BSP forecast suggests that June inflation could settle within the 2.4-3.2% range,” BSP Governor Amando M. Tetangco, Jr., who ends two successive six-year terms on July 2, told reporters in a mobile phone message.

That range compares to May’s actual 3.1% and would still be faster than June 2016’s 1.9%.

The estimate range falls within the central bank’s 2-4% target band for the entire 2017, with the lower estimate bringing the six-month average to 3.05% and the ceiling taking it to 3.18% against an official forecast average of 3.1% for the whole year.

“The decline in domestic fuel prices and lower electricity rates in Meralco-serviced areas could lead to lower price pressures for the month,” Mr. Tetangco said.

The Manila Electric Co. — the country’s biggest electricity distributor that serves the country’s capital and surrounding areas that cumulatively contribute more than a third to national output — cut its basic tariff for a second straight month in June, by P1.43 per kilowatt-hour (/kWh) to P8.17/kWh, “the second lowest since December 2009”.

Electricity alone contributes 4.51% to the consumer price index (CPI) — the theoretical basket of goods and services consumed by a typical Filipino household that, in turn, is used to compute general year-on-year price increases.

Fuel pump prices also went down from May. Energy department data showed gasoline prices going down to P41.50-45.25 per liter as of June 21 from P43.55-47.30 per liter as of May 31, diesel price easing to P28.85 per liter from P31.40 per liter and kerosene slipping to P35.45 per liter from P37.70 per liter in the same comparable periods.

The commodity group housing, water, electricity, gas and other fuels accounts for 22.46% of CPI, the second-biggest contribution next to food and non-alcoholic beverages’ 38.98%.

The Philippine Statistics Authority is scheduled to report June inflation data on July 5.

Inflation is a key indicator the central bank watches as it calibrates policy. Mr. Tetangco’s last policy meeting last June 22 saw the BSP’s Monetary Board maintaining the overnight lending rate at 3.5%, the overnight reverse repurchase rate at three percent and the overnight deposit rate at 2.5%. Reserve requirement ratios imposed on banks were also retained.

The BSP has kept policy rates steady since a rate hike in September 2014, save for procedural cuts in June last year as the central bank migrated to an interest rate corridor scheme that employs weekly term deposit auctions to better siphon excess liquidity and influence market rates.

Deputy Governor Nestor A. Espenilla, Jr., succeeds Mr. Tetangco on July 3.

“Moving forward, the BSP will continue to monitor evolving price conditions and adjust policy setting appropriately to ensure price stability conducive to balanced and sustained economic growth.”

Philippine gross domestic product grew by a slower-than-expected 6.4% in the first quarter — against a 6.5-7.5% official full-year target — but it was still the second-fastest clip among comparable major Asian economies next only to China.

Power firms get reprieve from EPIRA public ownership rule

by Victor V. Saulon, Sub-editor

Regulators have again given generation companies and distribution utilities temporary relief from a rule that requires them to sell to the public at least 15% of their common shares.

The deadline for compliance lapsed last June 29, but in a resolution dated June 27, the Energy Regulatory Commission (ERC) has extended the deadline for one year to June 29, 2018, or until it rules on a long drawn-out plea by the companies that the ERC consider registration with corporate regulator Securities and Exchange Commission (SEC) as “among the modes of public offering”, whichever is earlier.

The ERC did not identify the number of generation companies nor distribution utilities that are covered by the resolution.

But based on data from the Department of Energy, the country has around 137 power plant operators, although a number of them run several generators. Some of them are subsidiaries of companies that are listed.

Manila Electric Co., the country’s biggest electricity distribution utility, is listed. Visayan Electric Co., Inc., the second largest, is not listed but the joint venture partners that own the utility are — Aboitiz Power Corp. and Vivant Corp.

AboitizPower also owns Davao Light and Power Co., the country’s third-biggest utility. The unit is also not listed.

That was not the first time that the ERC extended the deadline for companies to allow the public to partly own them.

The minimum 15% public ownership was stipulated in the implementing rules released on August 17, 2005 giving teeth to Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001, or EPIRA in a sweeping reform meant to attract private capital into the sector after a power crisis in the early 90s.

That did not push through, with the ERC itself suspending implementation until it completes public hearings on the implementing rules.

Six years later, or on May 23, 2011 through a resolution, the regulator revived its bid to require the companies to sell shares to the public in five years’ time.

That five-year period, which ended on June 29 last year, was extended for one more year or June 29 of this year, after the ERC received a letter asking whether its 2011 resolution will be put on hold ahead of the resolution of a separate petition filed on October 13, 2015.

The petition in 2015 sought the inclusion of the registration of common shares at the SEC among the allowed modes of public offering. It also asked that ERC’s resolution issued in 2011 be held in abeyance ahead of petition’s resolution.

The inclusion of SEC registration was first raised in 2011, when the Private Electric Power Operators Association sought clarification from the ERC in its letter filed on July 4, 2011.

In its resolution released this week, the ERC said that while it was in the process of completing the required public consultation, a “fortuitous event” took place as martial law was declared in Mindanao “thereby interrupting the conduct of hearings prescribed under the ERC Rules of Practice.”

“WHEREAS, the Commission in order to complete the required public consultations on the instant petition and due to the fortuitous event mentioned, has resolved, to extend for one (1) year the compliance period provided in said Resolution pending final resolution on the Petition,” the ERC said.

It was signed by the four ERC commissioners Alfredo J. Non, Gloria Victoria C. Yap-Taruc, Josefina Patricia A. Magpale-Asirit and Geronimo D. Sta. Ana.

Net external liabilities fall in Q1, BSP says

THE COUNTRY’S net external liability position declined in the first quarter of 2017 despite persistent volatility on global markets, the Bangko Sentral ng Pilipinas (BSP) said on Friday.

The international investment position (IIP) narrowed, although still in a net liability position at $27.5 billion as of end-March from the $30.6 billion recorded at end-2016 following an increase in total external financial assets and a marginal decrease in external financial liabilities.

“The country’s net liability position improved notwithstanding the lingering volatility in the external environment and the uneven pace of growth in the global economy,” the BSP said in a statement.

As of the first quarter, BSP data show that total external financial assets rose 1.3% to $164.7 billion, while external financial liabilities fell 0.5% to $192.2 billion.

The IIP, which measures the stock of a country’s financial claims and liabilities, is a companion framework to a country’s balance of payments (BoP) statistics.

The BSP said external financial assets held by the Philippines increased by $2 billion from a year earlier due primarily to the $1 billion increase in direct investment, largely on account of placements of equity capital and positive price revaluation; $545 million worth of additional flows of portfolio investment which comprised mainly residents’ holdings of long-term debt securities issued by non-residents; and $369 million increase in other investments, stemming mostly from non-residents’ availment of loans from residents.

The modest decline in total external financial liabilities on the other hand was driven mainly by lower portfolio investment, particularly non-residents’ net holdings of debt securities issued by residents.

“This more than compensated for the increase in foreign direct investment (FDI) arising from non-residents’ investments in debt instruments issued by local affiliates and net equity capital inflows as well as stock price valuation adjustments, on the back of the country’s sustained positive economic performance and growth prospects,” the BSP statement read.

The central bank noted that all sectors registered improvement in their net external positions as of end-March.

The BSP’s foreign currency reserves accounted for nearly half of the country’s total external assets or 49.2%, amounting to $81.0 billion, slightly higher by $203 million than the stock recorded in end-December 2016.

By type of instrument, the central bank said 49.1% of residents’ total external financial assets were reserve assets held by the BSP.

Investment in debt instruments — or intercompany borrowings — accounted for 16.3% of the total assets, while shares of stock issued by foreign affiliate firms took an 11.9% share, the central bank said.

Investments made by foreigners in shares of stock issued by Philippine companies accounted for almost a two-thirds or 64.9% of the country’s total external obligations. This comprised mostly foreigners’ placements in equity capital in local affiliates (32.6%), equity securities issued by local corporations (32.4%), and debt instruments issued by local affiliates to foreign affiliates (18.6%).

Meanwhile, total external financial liabilities, by instrument, consisted mostly of non-residents’ holdings of equity securities issued by local corporations (26.0%), non-residents’ placements of equity capital in resident affiliates (22.7%), and residents’ availment of foreign loans (22.2%). — Imee Charlee C. Delavin

Napocor to remit additional P3.44 billion to government

THE DEPARTMENT of Finance (DoF) said the National Power Corp. agreed to pay P3.44 billion in dividends, including those in arrears, with the proceeds to help fund infrastructure projects.

In a statement e-mailed to reporters on Friday, Finance Secretary Carlos G. Dominguez III, citing a report from the Finance department’s Corporate Affairs Group (CAG,) said Napocor committed to remit an additional P472 million worth of dividends for 2016 and another P2.97 billion in dividends owed from 2012 to 2015, payable over five years.

Napocor will remit P594 million annually, beginning in the third quarter for the amounts owed between 2012 and 2015, on top of the regularly-scheduled payments.

Government-owned and-controlled corporations (GOCCs) are required to remit at least half of their income as dividends to the national government in accordance with Section 3 of Republic Act no. 7656 or the Government Owned and Controlled Corporations (GOCC) Dividend Law.

According to DoF Undersecretary Antonette C. Tiokno, the additional P3.44 billion in revenue will fund infrastructure and social spending, the budget for which amounts to P860.7 billion out of the P3.35 trillion national budget this year, up from the P756.4 billion programmed in 2016. The amount translates to 5.4% of the country’s total gross domestic product (GDP) for 2017.

“Even if we collect (from Napocor) they will still be left with sufficient cash for their operations,” she said. Ms. Tiokno also said Napocor remitted P333 million in dividends to in May.

Napocor did not reply to BusinessWorld when asked for comment.

The Bureau of Treasury reported dividends remitted GOCCs surged by 701.6% to P14.02 billion as of the May 15 deadline. In the five months to May, total dividends hit P18.641 billion, down 32.82% year-on-year. In 2016, the state collected P28.89 billion in dividends.

Mr. Dominguez had said that despite the increase in dividends, some P110.23 billion remains in arrears from 2016.

Those with dividends to remit include the Philippine Deposit Insurance Corp. (PDIC) with P46.5 billion, Power Sector Assets and Liabilities Management (PSALM) Corp. at P29.87 billion, Napocor at P20.66 billion, Philippine Charity Sweepstakes Office (PCSO) at P6.89 billion and Civil Aviation Authority of the Philippines (CAAP) at P6.31 billion. – Janine Marie D. Soliman

Jollibee capex set to double amid aggressive store expansion

JOLLIBEE Foods Corp. said it is looking to breach the 4,000-store level across all its brands in 2017, while allocating P14.7 billion in capital expenditure for the period.

The listed fast food chain plans to open 350 more stores this year, after ending May 2017 with a total of 3,555 stores across 12 brands in 17 countries. Of the total store count, 250 of those scheduled for opening will be in the Philippines while the remaining 100 will be overseas.

“Yearend we will be hitting that 4,000 level… we are still focusing on our existing markets and opening more stores in these countries,” JFC Chairman Tony Tan Caktiong told reporters after the company’s annual shareholder meeting in Pasig on Friday.

JFC has allotted more than twice its 2016 capex of P6.7 billion to finance this year’s operations. Bulk of the spending will be for store expansion and renovations at P9 billion, while the remaining P5 billion will be used for expanding its capacities.

Mr. Caktiong further said the group will be aggressive overseas, with first stores in Toronto and the Manhattan borough of New York City, following the successful opening of a store in Jacksonville, Florida last year. The company also has plans to set up shop in Australia and Guam.

In the Asia-Pacific market, the company is planning further expansion in Vietnam and China.

In China, the company targets 35 new stores with the focus on Beijing.

“We can still expand a lot (in the area)… But it can grow outside Beijing. Right now we may even go to Northern China,” Mr. Tan Caktiong said.

To accelerate operations in Vietnam, Mr. Tan Caktiong said JFC is looking to list the Superfoods Group on the Vietnamese bourse by July 2019, but has yet to determine the size of the float.

“(Proceeds) will be used primarily for the expansion because the brand is growing very fast, and the industry in Vietnam is really showing potential for growth. So it’s really for growth in Vietnam,” Mr. Tan Caktiong said, adding that the listing will help finance the construction of 300 stores over the next five years.

Superfoods is JFC’s joint venture with Viet Thai International Joint Stock Co. From 2018 to 2021, JFC is aiming to raise its stake in the venture from the current 40% to 85% in preparation for the listing.

Consolidating Superfoods into JFC will also allow the company to hike the contribution of its foreign business to overall operations. JFC’s foreign business currently accounts for 30% of its systemwide sales.

“We will probably achieve a 50% ratio (for foreign business by the time we consolidate), because we are now basically 30%,” JFC Chief Financial Officer Ysmael V. Baysa said.

Mr. Tan Caktiong added that the group is also looking at entering Japan by 2019.

JFC currently has 12 brands under its portfolio, including Jollibee, Greenwich, Red Ribbon, Chowking, Burger King, and Mang Inasal.

In the first quarter of 2017, the firm booked a net profit attributable to shareholders of P1.53 billion, up 9.65% year-on-year.

Shares in JFC fell P1.40 or 0.68% to P204 on Friday. — Arra B. Francia

Century Pacific sees international businesses driving profit

CENTURY Pacific Food, Inc. (CNPF) said margin pressures seen in the home market mean its international investments will help drive profit growth to double-digit levels this year.

CNPF President Christopher T. Po said that while the main driver of growth is still the domestic tuna business, the company is starting to see growth from international investments, particularly in China. The group consolidated Century China Group of Companies into CNPF in 2016 in order to expedite decision-making for the company.

“We will leverage on the existing equity of the Century brand in China to grow the existing business and create a channel for our products into this massive market,” Mr. Po said in his message to shareholders during the company’s annual meeting in Pasig City on Friday.

The listed firm’s China business currently covers around 30 cities with about 40 employees.

“The first order of business is to stabilize the organization… since it’s under new management we’re stabilizing it. Studies are on the way to see what products we could introduce to the China market,” Mr. Po added.

CNPF also purchased the Kamayan shrimp paste trademark for North America in 2016. This marks CNPF’s maiden venture into branded categories outside its core segments. Its latest venture was the acquisition of the license of North American pork and beans brand Hunt’s from Universal Robina Corp. in May.

“(Businesses in the) US, Middle East, because of overseas Filipinos, are starting to grow,” Mr. Po said.

To date, CNPF’s export business comprises 25% of its overall operations, spanning 58 countries including the Middle East and Southeast Asian regions. This translates to P6-7 billion in annual revenue.

Asked if the group has more acquisitions in the pipeline, Mr. Po said CNPF is open to opportunities should they arise but will not be as aggressive to focus on growing current investments.

This year, the company is planning to make P1.1 to 1.5 billion in capital expenditures. Actual spending in 2016 stood at P1.2 billion.

The executive noted that while earnings would be a “little more muted” this year, the company will still be able to deliver healthy results.

“What were tailwinds in 2016 are now headwinds in 2017. Commodity prices are higher, there’s a bit more uncertainty right now, but having said that we’re still cautiously optimistic with business prospects, but we do expect that there is margin pressure,” Mr. Po said.

Earnings of the country’s largest canned food manufacturer grew by 10% during the first quarter of 2017 to P701 million, following a 17% rise in gross revenue to P7.5 billion.

“I think Q1 2017 results where our topline still grew 17%, bottomline moderated to 10%, so I guess that sets the tone for the rest of the year,” Mr. Po said. — Arra B. Francia

Money supply grows 11.3%, bank lending up 18.7% in May

MORE FUNDS circulated in the economy in May, with money supply sustaining its double-digit growth and bank lending also growing at a similar pace, the Bangko Sentral ng Pilipinas (BSP) said on Friday.

Domestic liquidity or M3, the broadest measure of money in an economy, grew by 11.3% last month to reach P9.6 trillion from the P8.7 trillion during the same period in 2016. It was also faster than the 11.2% reading in April which amounted to P9.5 trillion.

The BSP said in a statement that sustained demand for credit remained as the principal driver of money supply growth. Month on month, liquidity increased by 1.2%.

Domestic claims during the period rose by 14.3% from a year ago, faster than the 13.8% growth seen in April due largely to sustained growth in credit to the private sector.

Growth in bank loans remains strong on account of lending to key production sectors such as real estate activities; electricity, gas, steam and airconditioning supply; manufacturing; wholesale and retail trade, repair of motor vehicles and motorcycles; and information and communication.

On the other hand, net claims on the national government rose by 8.9% during the month as the state took on more loans, the central bank said.

Meanwhile, net foreign assets (NFA) — expressed in peso terms — posted a 4.6% increase year-on-year coming from a 3.6% uptick the previous month.

“Foreign exchange inflows coming mainly from overseas Filipinos’ remittances and business process outsourcing receipts continued to be the drivers behind the increase in the BSP’s NFA position,” the BSP said.

Net foreign holdings held by local banks also expanded due to the growth in banks’ foreign assets resulting from higher loans and investments in marketable debt securities.

“The growth in M3 remains consistent with the BSP’s prevailing outlook for inflation and economic activity. Going forward, the BSP will continue to monitor domestic liquidity closely to ensure that monetary conditions remain conducive to maintaining price and financial stability,” the central bank’s statement read.

The government is targeting a 6.5-7.5% gross domestic product growth this year, which if realized would keep the Philippines as one of the fastest-growing in the world. In the first quarter, the economy grew slower than expected at 6.4%, although Socioeconomic Planning Secretary Ernesto M. Pernia had said that growth is likely to pick up during the second quarter.

BRISK LENDING

The BSP also reported yesterday that bank lending grew by 18.7% in May from a year ago, although it moderated from the 19.2% rise seen in April, according to central bank data.

Month on month, total lending rose by 1.7%.

Computed to include reverse repurchase deals entered into by the banks, total lending grew by 17.4% in May, against 16% a month prior.

“The growth in production loans was driven primarily by increased lending to the following sectors: real estate activities (17.1%); electricity, gas, steam and airconditioning supply (24.8%); manufacturing (10.9%); wholesale and retail trade, repair of motor vehicles and motorcycles (10.6%); and information and communication (36.2%),” the BSP said, noting that bank lending to other sectors also increased during the month.

Meanwhile, consumer lending increased by 23.6% in May due to the expansion in credit card loans as well as sustained growth in auto loans and salary-based general purpose loans, offsetting the contraction in other types of household loans.

Looking ahead, the BSP said it “will continue to ensure that the expansion in domestic credit and liquidity conditions proceeds in line with overall economic growth while remaining consistent with the BSP’s price and financial stability objectives.” — Imee Charlee C. Delavin

Peso claws back losses

THE PESO finished the week stronger against the greenback despite hitting fresh multi-year lows in intraday trade due to robust US economic growth.

The local currency was lifted by upbeat key Chinese economic data, traders said.

It closed at P50.47 versus the dollar on Friday, appreciating by six centavos from its P50.53-per-dollar finish on Thursday, which was the peso’s weakest level in more than a decade or since it closed at P50.65 per dollar on Sept. 1, 2006.

Despite a stronger finish, the peso opened yesterday’s session at its worst showing for the day at P50.60 per dollar while its intraday peak was seen at P50.33 against the greenback.

Dollars traded totalled $760.9 million on Friday, rising from the $564.7 million that changed hands the previous session.

One trader attributed the peso’s rebound against the dollar yesterday to a sell-off among investors and on the back of strong Chinese manufacturing data.

“In the morning the peso was at P50.60 because overnight stocks were weak, but then towards the afternoon there was a selloff due to strong selling on the local currency,” the trader said by phone on Friday.

“Chinese manufacturing data was also stronger so it bolstered the peso that’s why it went as high as P50.33 per dollar,” the trader added.

Chinese factories grew their output at their fastest pace in three months in June, foreign media reported on Friday.

The trader mentioned that the peso opened the session weaker versus the foreign currency after the US Commerce Department revised upwards the gross domestic product data (GDP) for the first quarter.

“I think we saw a lot of profit taking and some trimmed their positions when the exchange rate fell at the P50.40 to the dollar levels,” the trader said. — Janine Marie D. Soliman

Home prices edge up in first quarter — BSP

By Janine Marie D. Soliman

HOUSING PRICES saw an uptick in the first three months of the year, after more Filipinos acquired loans for homes, particularly on residential condominiums, latest data from the Bangko Sentral ng Pilipinas (BSP) showed.

Costs to acquire homes slightly rose by 1.1% in the January to March period from the comparable period a year ago, according to the central bank’s residential real estate price index (RREPI) released Friday.

The RREPI is the BSP’s tool that measures the average change in home prices across building types and locations, allowing regulators to assess overall real estate and market conditions and monitor any looming bubbles in the property sector.

A housing price index is also among the indicators of financial soundness as identified by the International Monetary Fund.

According to the BSP, seven out of 10 or 69% of real estate loans in the first quarter were made for the purchase of new housing units. Broken down, bulk or 48.4% of residential property loans accounted for condominium units, which was followed by single detached units at 43.3% and townhouses at 7.9%.

Loans granted expanded in all housing unit types versus its year-ago levels, with condominium units logging the fastest growth of 26.9%.

Meanwhile, average residential property prices in the National Capital Region (NCR) and areas outside NCR (AONCR) both picked up pace by 1.1% in the January to March period, with NCR real estate prices reverting to the positive levels from a decline in the last quarter of 2016. While average residential property prices in AONCR were steady by end-March.

“In NCR, the higher growth in prices of single detached houses and townhouses outweighed the slower increase in prices of condominium units,” the BSP stated.

In contrast, condominium units in AONCR logged a double digit expansion, which offset the slight decrease in prices of single detached houses and townhouses.

Condominiums were also reported to be the most purchased in NCR, while single detached houses were much preferred in AONCR.

Broken down, NCR comprised bulk or 44.8% of total number of residential real estate loans granted by end-March, followed by CALABARZON at 29.3%, Central Luzon at 6.7%, Central Visayas at 5.7%, Western Visayas at 5.1%, Davao region at 3.2%, and Northern Mindanao at 1.5%, amounting to a total of 96.3% in total housing loans granted by local lenders.

The BSP collects RREPI data from the mandatory reports submitted by banks, which cover the amounts and profiles of the home loans which they hand out every quarter.

TAGS: home prices, real estate

US think tank: Weapons system firmed up in Chinese structures in Spratlys

By Ian Nicolas P.Cigaral, Reporter

CHINA “remains committed to developing its power projection capabilities” in the South China Sea, a US think tank reported, as it flagged the Asian power’s installing weapons system on major reefs in the disputed waters.

The updated report (available in this link) could raise tension anew among nations with overlapping claims on the strategic waterway, including the Philippines, which recently sent its top diplomat to China at the latter’s “invitation” as both countries endeavor to rebuild ties that had been tested by their maritime dispute.

In a report dated June 29, the Asia Maritime Transparency Initiative (AMTI) of Washington’s Center for Strategic and International Studies said China continues its militarization on the Spratly Islands, a South China Sea chain, by building new military facilities.

Showing satellite images, AMTI said Beijing has constructed new missile shelters and communications facilities on Fiery Cross (or Kagitingan, as named by the Philippines), Mischief (Panganiban), and Subi (Zamora) Reefs.

The islands, which the Philippines also claims, are about 230 miles southwest of the country’s archipelago province of Palawan.

On May 19, the Philippines and China held their first bilateral consultations on the South China Sea issue — almost a year after a ruling on an arbitral case by the Philippines that China rejects.

That same day, President Rodrigo R. Duterte in a speech claimed that his Chinese counterpart Xi Jinping had warned him of war if Manila enforces the ruling and drill for oil in the sea. Both countries subsequently played down these remarks.

In his meeting with Philippine counterpart Alan Peter S. Cayetano last Thursday, June 29, Chinese Foreign Minister Wayng Yi, as quoted by Reuters, said relations between China and the Philippines are in a “golden period of fast development.”

This is in contrast to Mr. Wang’s describing those ties as being in “a dead knot” during the administration of Mr. Duterte’s predecessor, Benigno S.C. Aquino III.

Among the three maritime features, Fiery Cross remains to be the “most advanced of China’s bases,” the report said, after China installed four additional missile shelters on top of the eight already on the artificial reef.

AMTI reported in February that Mischief and Subi Reefs each have eight “hardened” shelters with retractable roofs.

On Mischief, China is expanding its communications and radar capabilities by installing a “very large” antennae array in the man-made reef, AMTI said.

Moreover, a large radome has been newly installed while another one is under work on Fiery Cross, “indicating a sizable communications or radar system,” the think tank also said.

Two more big radomes are also being assembled on Mischief while a smaller dome has been erected near the shelters of the artificial island, it added.

Philippine Defense Secretary Delfin N. Lorenzana when sought for comment: “I have not seen these new imageries and compare them with the old ones.”

For his part, Presidential Spokesperson Ernesto C. Abella told reporters in a news conference on Friday that Manila will follow Mr. Duterte’s “non-combative and non-adversarial” approach in fixing issues with China.

“We need to reiterate the fact that his approach to the situation, to regional socio geopolitics, has always been to come into a mutual understanding and dialogue in order to resolve cases like these,” Mr. Abella said.

Palace warns of NPA attacks but says ‘we don’t have details’

By Ian Nicolas P. Cigaral, Reporter

Malacañang on Friday warned the public of possible attacks by the New People’s Army (NPA) — the armed wing of the Communist Party of the Philippines (CPP).

“We also wish to forewarn the public of reported planned attacks of the NPA on people-oriented programs and infrastructure projects,” Presidential Spokesperson Ernesto C. Abella said in a press briefing in Davao City.

“We also appeal to everyone to share information with authorities on suspicious persons and activities in their communities,” Mr. Abella added.

But when sought for details on the Leftist fighters’ plot, Mr. Abella said, “We don’t have details regarding the planned attacks, except the warning. The announcement is that we should be vigilant and we should be careful about our surroundings.”

A fifth round of peace negotiations was effectively derailed after the NPA ordered intensified attacks amid President Rodrigo R. Duterte’s May 23 declaration of martial law in Mindanao in response to the Marawi crisis.

Last week, the CPP criticized the government for its series of statements “impugning” the Left’s sincerity to talk peace following sustained attacks by members of the NPA in different parts of the archipelago.

According to the military, soldiers have killed 50 “communist terrorists” and recovered high-powered firearms in separate operations outside Marawi City since the first day of the bloody siege by the Islamist militants.

The communists have been waging a “revolution” against the state since 1968 to topple a “capitalist system.” They are known for attacking state forces and extorting money from local business particularly in rural areas.

“If we work together, we can prevent these extortion-related activities,” Mr. Abella also said.

PAL announces change of terminal in Middle East flights

By Imee Charlee C. Delavin, Senior Reporter

PHILIPPINE AIRLINES (PAL) on Friday, June 30, announced changes in the arrival and departure terminal of its Middle East flights starting July.

In a statement, the flag carrier said PAL flights to and from the Middle East, except Dubai, will depart from and arrive in NAIA Terminal 1, Pasay City, from the previous Terminal 2 assignment for most of the airline’s international flights.

PAL said flights to the Middle East covered by this new terminal assignment are those heading to Jeddah, Kuwait, Dammam, Doha and Riyadh as well as flights coming from these Middle East destinations to Manila.

The Philippine carrier operates 30 flights per week to the Middle East (7x weekly to Dubai; 4x to Kuwait; 4x to Doha; 5x to Dammam; 3x to Jeddah; and 7x to Riyadh).

PAL has direct Manila-Abu Dhabi (UAE), Manila-Dubai (UAE), and Manila-Doha (Qatar) flights.

Late last month, the flag carrier announced it is suspending its Manila-Abu Dhabi flights starting July 8 as it undertakes “route assessment initiatives,” although it will continue to fly to Dubai, Doha, Jeddah, Riyadh, Kuwait and Dammam.

The flag carrier serves at least 43 international destinations, including 20 regionally within East Asia, 10 in Australasia and the Pacific, seven in the Middle East, five in continental North America and one in Europe. ##

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