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Hello Kitty, parasites: Inside North Korea’s trash balloons according to South’s officials

A BALLOON believed to have been sent by North Korea, carrying various objects including what appeared to be trash, is pictured in Incheon, South Korea, June 2, 2024. — YONHAP VIA REUTERS

SEOUL — Among the trash that balloons carried over the border from North were articles printed with Hello Kitty characters, badly worn clothing, and soil containing traces of human feces and parasites, South Korea said on Monday.

North Korea has flown balloons carrying trash since late May, with hundreds landing in South Korea. South Korea deployed military explosives units and chemical and biological warfare teams to inspect the objects.

The items also included clothes that had been donated from the South that were slashed and cut up, and general trash that appeared to be hastily collected, the South’s Unification Ministry, which handles the North, said in a report.

North Korea has said the balloons were retaliation for a propaganda campaign by North Korean defectors and activists in the South who regularly send over balloons carrying food, medicine, money and leaflets criticizing the North’s leaders.

Parasites and human DNA were found in the dirt in some of the plastic bags, which shows it contained fertilizer that used human feces, the ministry unification ministry said.

North Korea, which suffers a chronic food shortage, depended on South Korea for massive shipments of chemical fertilizer until such aid was suspended in 2007 as Pyongyang accelerated weapons development.

The trash contained worn items of clothing with Mickey Mouse, Winnie the Pooh and Hello Kitty characters as well as socks, gloves and children’s clothes that had been heavily patched up, masks with fabric stitched by hand and two layers of shirts sewn together.

Last week, the North warned it would send more balloons carrying trash. — Reuters

Mcdonald’s and TESDA partner to develop PH’s first QSR training curriculum

George T. Yang’s McDonald’s Philippines and the Technical Education and Skills Development Authority (TESDA) recently signed a Memorandum of Agreement (MoA) to develop training standards on Quick Service Restaurant (QSR) skills and competencies, aiming to provide skills training through Institution-Based Training (IBT) and/or Enterprise-Based Training (EBT) Programs for more Filipinos. This groundbreaking partnership aims to establish the first-ever TESDA-accredited curriculum for QSR training in the country.

As part of the collaboration, McDonald’s Philippines’ Crew training programs will undergo review and accreditation by TESDA. This initiative aims to bring forth a standardized and nationally recognized training curriculum that will enhance skills and improve employability of individuals seeking careers in the QSR industry.

A labor market information report on QSRs will first be developed to help identify the skills and competencies the potential employees should have. This will be followed by the creation of a set of Competency Standards, a Competency-Based Curriculum, an Institutional Assessment Tool, and Regional Lead Trainers, to make the program for the QSR industry more solid.

The partnership will also focus on promoting the TESDA-GADC Partnership Program to raise awareness about the opportunities available for individuals interested in pursuing a career in the QSR industry.

“We are excited to partner with TESDA in developing the first-ever QSR training curriculum in the country,” said Ruben R. Marasigan, Vice-President of Human Capital Group of McDonald’s Philippines. “We take pride in the quality and caliber of our crew training program. We have seen first-hand how our (McDonald’s) commitment to people, especially on training and development, enables our crew to upskill and be their best selves, giving them a better opportunity to grow and succeed in the food service industry. Today, our goal for this partnership is to extend or share our crew training program for the benefit of more Filipinos nationwide.”

TESDA Secretary/Director-General Suharto Mangudadatu, Ph.D. expressed his enthusiasm for the partnership, saying, “This MoA with McDonald’s Philippines is a significant step towards addressing the skills gap in the QSR industry. By providing standardized training and accreditation, we aim to produce highly skilled and competent individuals who can excel in their chosen careers.”

The partnership between McDonald’s Philippines and TESDA signifies a commitment to upskilling the workforce and providing accessible training opportunities for aspiring QSR professionals. This initiative is expected to contribute to the overall growth and success of the fast-food industry in the Philippines.

 


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Globe unlocks new digital frontiers with GSMA’s Open Gateway

Globe has taken a significant step forward in accelerating digital innovation. The mobile leader signed a Memorandum of Understanding (MOU) with the GSM Association (GSMA) to improve the interoperability and delivery of mobile services across different networks worldwide through collaboration and standardization. 

This strategic partnership grants Globe access to the GSMA Open Gateway, an Applications Programming Interface (API) facility that represents a significant shift in how the telecom industry designs and delivers services within an API-driven economy.

By utilizing a common set of open source APIs that can be reused for different purposes, developers and cloud providers could gain access to operator networks via single points of entry or access, enabling rapid service deployment across the world’s largest connectivity platform. In addition, GSMA’s Open Gateway unlocks the full potential of 5G networks, allowing developers to create relevant and transformative services that can leverage on our  network’s 5G capacity and security. 

“Today marks a milestone for Globe as we embrace the GSMA Open Gateway initiative, teaming up with 40 mobile network operators to develop Mobile Network Open APIs,” said Ernest L. Cu, President and CEO of Globe, during the recent MOU signing attended by Julian M. Gorman, GSMA Asia Pacific Head.

“This groundbreaking effort allows real-time access and interconnection with the Globe network via open global APIs, opening up numerous opportunities for delivering more value to our customers and generating new revenue streams,” he added. 

Welcoming Globe to the initiative, Gorman, said: “It’s great news that Globe Telecom and the mobile industry in the Philippines are getting behind our global GSMA Open Gateway initiative. By doing so, they’re helping developers gain universal access to operator networks both within the country and around the world through a set of common APIs. This will help drive the mobile economy and the launch of new services that deliver better customer experiences, combat fraud and unleash new functionality in 5G networks. We welcome Globe Telecom to this innovative new programme.”

GSMA’s Open Gateway launched with eight network APIs — SIM Swap API, Quality on Demand API, Device Status API, Number Verification API, Simple Edge Discovery API, One Time Password (SMS) API, Carrier Billing — Check Out API, and Device Location API. These APIs enable a wide range of capabilities, from enhancing security and fraud prevention to facilitating secure authentication and enabling location-based services.

Globe recognizes the vast potential of these common APIs in eHealth, agritech, emergency services, carbon accounting, and the Internet-of-Things (IoT), among other sectors. Open APIs can also benefit industries such as education through the integration of mobile learning platforms into school curricula; entertainment, by providing personalized content recommendations and interactive features to enhance user experience; secure eCommerce and transportation via improved traffic management systems and real-time updates on public transportation schedules.

“Leveraging open APIs across various sectors will help us significantly scale our ICT portfolio, even as we pursue our mission to solve our customers’ pain points at scale. Enabling seamless integration and innovation will significantly help API development and improve user experiences,” said Cu.

Open Gateway will also allow Globe to optimize its 5G network, including its use for Internet of Things (IoT) and deliver exceptional services for both its individual and business customers.

As Globe continues to thrive through strategic partnerships, the company is proud to join GSMA’s initiative, aligning with its purpose of uplifting lives through technology. 

“We are incredibly grateful to GSMA for providing an opportunity for mobile network operators to explore and unlock the potential of Open APIs and 5G technology. GSMA’s vision and initiative have paved the way for groundbreaking solutions across multiple industries, enhancing how we live and work. We look forward to continued collaboration, driving innovation and delivering transformative solutions to our customers,” concluded Cu.

To learn more about Globe, visit www.globe.com.ph.

 


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Autocracy is ‘evil’, Taiwan president says after China threatens death for separatism

TAIWAN President-elect Lai Ching-te, of Democratic Progressive Party (DPP), holds a press conference, following his victory in the presidential elections, in Taipei, Taiwan, Jan. 13, 2023. — REUTERS

 – Democracy is not a crime and autocracy is the real “evil”, Taiwan President Lai Ching-te said on Monday after China threatened to impose the death penalty in extreme cases for “diehard” Taiwan independence separatists.

China, which views Taiwan as its own territory, has made no secret of its dislike of Mr. Lai, who took office last month, saying he is a “separatist”, and staged war games shortly after his inauguration.

On Friday, China ramped up its pressure on Taiwan by issuing new legal guidelines to punish those it says support the island’s formal independence, though Chinese courts have no jurisdiction on the democratically governed island.

Asked about China’s move at a news conference at the presidential office in Taipei, Mr. Lai first reiterated his sympathy for recent flooding in southern China before responding.

“I want to stress: democracy is not a crime; it’s autocracy that is the real evil. China has absolutely no right to sanction Taiwan’s people just because of the positions they hold. What’s more, China has no right to go after Taiwan people’s rights across borders,” he said.

According China, anyone who does not uphold “reunification” is therefore a Taiwan independence supporter, Mr. Lai added.

“I also want to call on China to face up to the existence of the Republic of China and have exchanges and dialogue with Taiwan’s democratically elected, legitimate government,” he said, using Taiwan’s formal name. “If this is not done, relations between Taiwan and China will only become more and more estranged.”

Taiwan said that since Thursday, there has been a sharp increase in Chinese military flights as Beijing carried out a “joint combat readiness patrol” near the island.

Between Thursday and Sunday, Taiwan says it detected 115 Chinese military aircraft operating nearby, getting as close at 31 nautical miles (57 km) from the southern tip of the island.

Taiwan has said that for the past four years China has carried out regular military activity around the island as part of a “grey zone” pressure campaign.

Taiwan’s annual Han Kuang war games next month will aim to mimic actual combat as closely as possible given a rapidly rising “enemy threat” from China, a senior official said.

Mr. Lai rejects Beijing’s sovereignty claims and says only Taiwan’s people can decide their future. He has repeatedly offered talks with China but been rebuffed.

China says any move by Taiwan to declare formal independence would be grounds to attack the island.

The government in Taipei says Taiwan is already an independent country, the Republic of China, and that it does not plan to change that. The Republican government fled to Taiwan in 1949 after losing a civil war with Mao Zedong’s Communists.

Mr. Lai also faces domestic challenges, as his Democratic Progressive Party (DPP) lost its majority in parliament in the same election in January that brought him to power.

Speaking at the same news conference, Mr. Lai said he would ask the constitutional court to stay a package of contested parliament reforms the opposition has passed and consider whether they comply with the constitution.

The opposition says the reforms, which among other things criminalize contempt of parliament by government officials, are needed to bring more accountability, but the DPP says they were forced through without proper discussion. – Reuters

Climate-proofing India’s daily bread: The race for resilient wheat

STOCK PHOTO | Image by Jeevan Singla from Pixabay

 – When all else fails, Satveer Singh knows his family will manage if they have a sack of wheat flour in the kitchen to make rotis. Served hot and stuffed with sliced raw onion, the simple meal of Indian flatbreads keeps hunger at bay.

For now, the family can just about cover their needs – thanks in part to the ration they receive from a government program that distributes food to 800 million people across India.

“It is not enough, but … on a bad day when money is tight, this wheat helps,” Singh said, gesturing towards the sack of grains lying in a corner of his ramshackle house in a slum area known as Gheja village outside the capital, New Delhi.

Ruminating over when to take the grains to be milled, he said supplies from the government program were not always regular. A year or two ago, the family’s wheat ration was partly replaced by rice – for their taste, a poor replacement.

In 2022, hot weather arrived early in India’s major wheat growing regions, shriveling crops and leading the government to ban wheat exports and reduce rations of the grain under the food distribution program to protect domestic stocks.

A year later, history repeated itself. Even this year’s crop will be 6.25% lower than a government estimate of 112 million metric tons, a leading industry body forecasts, setting the stage for the country to import for the first time in six years.

Climate change impacts – including harsher heat, drought and floods – pose a major emerging threat to food security in India and elsewhere, accelerating diverse efforts to introduce crops that are better able to withstand shifting conditions.

In India, the world’s second-biggest wheat producer, scientists in government research institutes and universities are racing to develop and distribute a broad range of climate-resilient wheat varieties that could prove vital to shoring up food security for its 1.4 billion people.

Traditionally, crop breeding programs focused on boosting yield, “but that alone is no longer enough”, said Aditi Mukherji, director for climate change adaptation and mitigation at the Consultative Group on International Agricultural Research (CGIAR), a research partnership on food systems.

“Now, (we) need seeds that can withstand higher temperatures and are drought-resilient, or those that incorporate several climate-resilient features,” she said.

For farmers like Sukha Singh, who grows wheat on a 20-acre (eight-hectare) plot in the village of Ramba in northern Haryana state, supplies of new, hardier seeds could not arrive quickly enough after hefty climate-related losses in recent years.

 

HARVEST LOSSES

Sukha Singh lost more than 30% of his wheat crop due to the heatwave that swept into northern India’s wheat belt in Haryana and neighboring Punjab state in March 2022, before the normal hot season between April and June.

“Wheat is my main crop, any shock in the harvest puts a strain on my income that takes me at least two years to recover from,” he told the Thomson Reuters Foundation on his farm, where this year’s crops were nearing harvest.

Studies have shown how temperature increases linked to climate change could reduce global wheat yields by up to 30% by mid-century, potentially slashing exports from major producers such as India and driving up global food prices.

In India, yields could fall by more than 8% by 2035 due to higher maximum temperatures and reduced rainfall, according to a government assessment. The decline could top 20% by the end of the century.

Following harvest losses over the last two years, more and more farmers in Haryana and Punjab are demanding and sowing climate-resilient varieties.

They are not always easy to find at local seed dealers, but Sukha Singh said he had been lucky.

“Fortunately … there was one that had just reached the dealer,” he said.

Developed by the Indian Institute of Wheat and Barley Research (IIWBR), a government-run research entity, the new variety has shown greater resilience against temperature fluctuations and untimely rains, and also came with the promise of increasing yields.

In 2023, as other farmers in Haryana counted their climate-related harvest losses for a second consecutive year, Sukha Singh’s wheat crop had a healthy yield of 25 quintals (2.5 tons) per acre – in line with his long-term average.

He credits the new variety for the results.

“(These seeds) are the first line of defense” for the country’s food security and the income of millions of farmers, he said.

 

DISTRIBUTION CHALLENGES

More than 70 climate-resilient wheat varieties are being developed or are already on the market in India, catering to the vast country’s diverse range of weather and soil conditions.

“These varieties save wheat crops against heat, drought, waterloging and prevalent diseases,” said IIWBR Director Gyanendra Pratap Singh.

Most were developed by cross-breeding indigenous seed genetics, while 20% used genetic materials supplied by international organizations such as the Mexico-based International Maize and Wheat Improvement Center, a leading global grains research institute.

But as climate change alters weather patterns around the world, developing new varieties quickly enough to respond and adapt is challenging, scientists say.

It takes three to four years to develop a new variety, with another two-three years for testing and a further three-four years for widespread distribution, said a government agriculture scientist working on the climate-proof wheat development.

That means it can take up to 10 years for a new seed variety to reach all of the country’s farmers, said Palvinder Singh, the seed merchant in Ramba where Sukha Singh bought his climate-ready seeds.

The next big challenge, scientists said, is making them available to more farmers, more quickly, by adopting innovative distribution systems.

Typically, new seed varieties have first been sent to government agricultural bodies, for example the National Seed Corporation, and state corporations who are charged with distributing them and increasing production. Privately owned seed companies are then roped in to massify supply.

But under a new approach implemented by the IIWBR, small-scale seed dealers with a strong local network of farmer clients – people like Palvinder Singh – are being brought into supply channels, significantly accelerating the process.

The institute signed a memorandum of understanding with 200 smaller seed dealers and partnered directly with local farming associations.

That means newly developed and tested climate-ready varieties can reach farmers in three or four years instead, Palvinder Singh said.

Highlighting the successes of the strategy, the IIWBR’s Pratap Singh said between 80% and 90% of the wheat ready to be harvested this year in Punjab and Haryana is from climate-resilient varieties.

The model is catching on and other government research institutions have also started including small-scale dealers in the early stages of seed distribution, Palvinder Singh said.

Fast and effective supply channels are not the only hurdle, however.

Crop development programs must be well-funded and have access to state-of-the-art technology, such as tools driven by artificial intelligence (AI), Mukherji said.

Raising awareness among farmers is also vital, crop development experts said.

First and foremost is that most of our farmers are resource poor with low levels of education … Most sow the seeds saved from their last crop and do not buy from the markets,” said Pratap Singh.

He said officials have been spreading the word about the new varieties in farming publications and via social media, but reaching every corner of the country is difficult.

“(Many) farmers in India … would never access these channels of information,” he added.

But as climate hazards grow, seeds alone will not be enough, Mukherji saidNew growing practices will also be needed.

“Farmers are already making many changes, for example, changing timing of sowing and harvesting, also changing cropping patterns,” she said, calling for more education and advisory services for the sector.

On his fields in Haryana, Sukha Singh was upbeat about this year’s harvest despite record heat and other adverse weather earlier in the season.

Mentioning India’s “green revolution” – when agriculture was modernized in the 1960s – he said science and new crop varieties had already helped the country to attain food self-sufficiency and turn the page on the “dark phase” of famine and mass hunger.

As climate change poses another threat, new varieties will again help farmers out of this challenge”, he added. – Reuters

 

China wants EU to scrap EV tariffs on EVs by July 4, Chinese state media reports

EREN GOLDMAN-UNSPLASH

– Beijing wants the European Union to scrap its preliminary tariffs on Chinese electric vehicles by July 4, China’s state-controlled Global Times reported, after an agreement by both sides to hold new trade talks.

Provisional EU duties of up to 38.1% on imported Chinese-made EVs are set to kick in by July 4 while the bloc investigates what the EU claims are excessive and unfair subsidies to Chinese EV makers.

China has repeatedly called on the EU to cancel its tariffs, expressing a willingness to negotiate. Beijing does not want to be embroiled in another tariff war, still stung by US tariffs on its goods imposed by the Trump administration, but says it would take all steps to protect Chinese firms should one happen.

Both sides agreed to start tariff talks after a call between EU Commissioner Valdis Dombrovskis and Chinese Commerce Minister Wang Wentao on Saturday during a visit to China by Germany’s economy minister, who said the doors for discussion are “open”.

The best outcome of the talks is that the EU scraps its tariff decision before July 4, Global Times reported late on Sunday, citing observers.

The EU’s increasingly protectionist moves will trigger countermeasures from China, and an escalation in trade frictions would only lead to “lose-lose” results for both sides, the newspaper said.

The tariffs are set to be finalized on Nov. 2 at the end of the EU anti-subsidy investigation.

China has rejected the accusations of unfair subsidies, saying the development of China’s EV industry has been the result of advantages in technology, market and industry supply chains. – Reuters

Some Vietnam coffee farms thrive despite drought, but may not stop espresso price hikes

STOCK PHOTO | Image by Leonel Barreto from Pixabay

 – Vietnamese coffee growers have been hit hard this year by the worst drought in nearly a decade, raising concerns of pricier espressos across the world, even as some farmers keep yields healthy with clever countermeasures.

Domestic forecasts for next season’s harvest in Vietnam, the world’s second biggest coffee producer, remain grim.

The Mercantile Exchange of Vietnam (MVX) expects a 10-16% fall in output because of the extreme heat that hit the Central Highlands coffee region between March and early May, according to deputy head Nguyen Ngoc Quynh.

However, a return of rains in recent weeks has improved the outlook, boosting confidence among farmers and officials. But it remains unclear whether the improved weather will help boost output and drive down prices of robusta beans, the variety most commonly found in espressos and instant coffees, of which Vietnam is the world’s top producer.

“I expect the country’s output to fall by 10-15%, but my farm will increase production”, said Nguyen Huu Long, who grows coffee in a 50-hectare plantation in Gia Lai, one of the top coffee-producing provinces in Vietnam.

To protect his trees during the heatwave, he kept the soil around the plants moist by covering it with leaves. Contrary to the local practice of cutting trees after a few years to boost soil quality, he keeps his growing for decades. As a result, plants have deeper roots and broader access to underground water reserves.

Farmers in his plantation also soften the soil around plants to improve absorption of rainwater and fertilizers, said Doan Van Thang, 39.

Tran Thi Huong, a tenant farmer who works in another plantation 20 km from Pleiku, Gia Lai’s capital, resorted to using more water than usual. Thanks to abundant reserves from canals built by local authorities, she could keep her plants sufficiently irrigated during the heatwave.

Coffee cherries are smaller than in previous years, but she expects the overall output to be unaffected. It also helped that she timely intervened with biopesticides against bugs that were more numerous than usual because of the extreme weather.

That is in line with the forecast from the United States Department of Agriculture (USDA) which estimates Vietnam’s next harvest would be roughly steady versus the current season’s output – far less pessimistic than domestic projections.

 

BITTER PRICE EFFECT?

Whatever the impact on the harvest will be, coffee prices for drinkers around the world are likely to rise.

Wholesale prices in Vietnam and London-traded robusta futures have risen to record highs earlier this year mostly after an underwhelming harvest in Vietnam and because of fears over the country’s next harvest after the drought, according to multiple traders and analysts.

Record wholesale prices have so far had a limited impact on consumer prices, with coffee inflation up by only 1.6% in the 27-country European Union in April, according to the latest Eurostat data, and 2.5% in robusta-loving Italy.

While well below price rises from a year earlier, it was higher than 1% in the March EU reading, a sign roasters may have started to pass their higher costs on consumers.

Besides, worries about Vietnam are far from over, as insufficient rains after the drought or excessive downpours before the upcoming October harvest season could further reduce output, warned a Vietnam-based trader.

The high wholesale prices may also be there to stay, as robusta demand is growing globally and farmers have boosted their leverage in the current circumstances, with many having also replaced coffee plants with pungent smelling durian, a tropical fruit experiencing huge demand in China.

“They have the financial ability to hoard and hold on goods, so they will not be in a hurry to sell,” said Le Thanh Son, of Simexco, one of Vietnam’s biggest coffee exporters. – Reuters

Mission 2025 group urges governments to set more ambitious climate goals

FREEPIK

 – Some of the world’s biggest companies, finance houses, cities and regions have joined forces to urge governments to increase their climate ambition ahead of a February 2025 deadline to deliver their emission-cutting plans to the United Nations.

The group has signed up to a coalition named Mission 2025. It is convened by Groundswell – a collaboration between non-profits Global Optimism, Systems Change Lab, and the Bezos Earth Fund.

Corporate backers include consumer goods company Unilever, the world’s biggest furniture retailer IKEA and British sustainable energy company Octopus EV. Others are represented through groups such as the We Mean Business Coalition.

While some fossil fuel companies have drawn criticism from environmental campaigners, others in business are frustrated by what they see as short-sighted governments reluctant to regulate to bring about necessary change when the evidence climate change is becoming more extreme is mounting.

Mission 2025 aims to reassure political leaders they have powerful support for bold action.

It is spearheaded by Global Optimism’s Christiana Figueres, who oversaw the Paris Agreement in 2015 that produced the first truly global agreement that countries would cut climate-damaging emissions.

Ten years on from the Paris deal, the nearly 200 countries who agreed to it have a deadline to put forward updated Nationally Determined Contributions (NDCs) that lay out a country’s policies towards meeting the global goal of reducing emissions.

More than two-thirds of annual revenues across the world’s biggest companies, totaling $31 trillion, was now aligned with the quest to reach net-zero emissions, the coalition said in a statement, citing data from the Energy & Climate Intelligence Unit, an independent climate think tank.

A UN-backed survey this month of the public’s views on climate change across 77 countries, meanwhile, showed 80% of respondents want their governments to take stronger action even though some governments, concerned about re-election and economics, have retreated from previous pledges.

Figueres told Reuters a “lack of leadership” and political noise were to blame for insufficient policy to drive the cleaner technologies that have shown themselves to be cheaper, better-performing, faster to construct and a safer investment than their incumbent rivals.

“The political economy is very clear that the future is one of decarbonization,” she said.

More clarity from governments over the direction of public policy was needed to give confidence to companies and others in the real economy to invest more in the transition to a low-carbon economy over the period to 2035.

“We think that governments are still very timid about what they’re going to be including in their NDCs,” she said, citing opposition from companies and others tied to the fossil fuel economy, which she said smacked of desperation.

UN Climate Change Executive Secretary Simon Stiell told delegates at a climate conference in Bonn this month that the NDCs needed to cover “every sector and all greenhouse gases”.

To help empower governments to go further, the Mission 2025 coalition would provide the data needed to justify the policy changes, with a focus on the 20 largest economies, responsible for the bulk of emissions, Ms. Figueres said.

“Those will be the ones that we will be focusing more on. Not only because they have the capacity to shift more, but also because they have the means to do it.” – Reuters

Infrastructure spending jumps in April

INFRASTRUCTURE SPENDING jumped in April amid the continued implementation of projects. — PHILIPPINE STAR/MIGUEL DE GUZMAN

INFRASTRUCTURE SPENDING jumped in April amid the continued implementation of projects, the Department of Budget and Management (DBM) reported.

Infrastructure and other capital outlays rose by 36.2% to P118.9 billion in April from P87.3 billion in the same month a year ago, according to the latest National Government disbursement report.

Month on month, infrastructure spending rose by 23.5% from the P96.3 billion recorded in March.

“The strong infrastructure spending performance was largely on account of the implementation of infrastructure projects of the Department of Public Works and Highways (DPWH), such as the construction, repair and rehabilitation of roads, bridges, and flood control structures; and the construction of administrative, hospital, and multi-purpose buildings,” the DBM said.

The DBM also cited the release of local counterpart funds for Department of Transportation foreign-assisted projects and the implementation of capital outlay projects under the Revised Armed Forces of the Philippines Modernization Program.

For the first four months of the year, infrastructure spending increased by 18.2% to P335.7 billion from P284 billion in the year-ago period.

The DBM said that higher spending in the January-to-April period was due to the implementation of various road infrastructure programs and defense modernization projects of the DPWH and Department of National Defense, respectively.

In the January-April period, overall infrastructure disbursements rose by 18.1% to P409.7 billion from P346.9 billion.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message that the higher spending in the first four months may be due to the lower base effects as the government suffered from underspending a year ago.

In the second quarter of last year, government spending contracted by 7.1%, bringing down overall gross domestic product (GDP) for the quarter to 4.3%. This as state agencies were flagged due to low budget utilization.

Mr. Ricafort also noted the government’s push for accelerated government spending would help drive economic growth.

“For the coming months, preparations for the May 2025 midterm elections could lead to more and faster government spending on various projects and programs, including infrastructure, before the election ban, thereby could lead to faster growth in infrastructure spending, going forward,” he said.

The midterm elections in May 2025 will have Filipinos voting for key positions such as 12 of the 24 Senate seats. Other positions include congressmen, governor, mayors, and village captains, among others.

The government is planning to spend 5-6% of GDP on infrastructure annually until 2028.

According to the latest Development Budget Coordination Committee data, this year’s infrastructure program is set at 5.6% of GDP.

Infrastructure is one of the administration’s priority investment areas. The government’s list of infrastructure flagship projects currently stands at 185 with a total value of P9.54 trillion. Luisa Maria Jacinta C. Jocson

Poll: BSP to stand pat for 6th straight meeting

The Philippine central bank earlier warned that inflation could temporarily overshoot the 2-4% target until July amid base effects. — PHILIPPINE STAR/RYAN BALDEMOR

By Luisa Maria Jacinta C. Jocson, Reporter

THE BANGKO SENTRAL ng Pilipinas (BSP) is expected to stand pat for a sixth straight meeting this week amid the peso’s weakness and risks to inflation.

A BusinessWorld poll conducted last week showed that all 15 analysts surveyed expect the Monetary Board to maintain its target reverse repurchase rate at a 17-year high of 6.5% at its policy meeting on Thursday.

The BSP has raised borrowing costs by a cumulative 450 basis points (bps) from May 2022 to October 2023.

“We don’t expect the BSP to change policy settings on June 27, but their post-meeting statement may continue to be less hawkish than their rhetoric early this year,” Bank of the Philippine Islands Lead Economist Emilio S. Neri, Jr. said in a Viber message.

“The BSP can afford a more dovish slant on Thursday following downside surprises on headline inflation prints for April and May,” he added.

Headline inflation accelerated to 3.9% in May from 3.8% in April, marking the sixth straight month that inflation settled within the BSP’s 2-4% target band.

“While the latest inflation print for May accelerated slightly, a reading within BSP’s target range of 2-4% for a sixth straight month will give comfort to the BSP,” Sarah Tan, an economist from Moody’s Analytics, said in an e-mail.

“Still, inflation is uncomfortably high at 3.9% which means that it is not time for the BSP to begin monetary policy easing just yet,” she added.

Pantheon Chief Emerging Asia Economist Miguel Chanco said that the Monetary Board is likely to maintain its policy rate as there is still a “small risk” of inflation breaching the upper end of the BSP’s target.

“To be clear, this breach should be temporary, lasting just one month, at most. By August, this temporary breach should have started to reverse, paying the way for the Board to start a normalization of policy,” he said.

The BSP earlier warned that inflation could temporarily overshoot the 2-4% target until July amid base effects.

Security Bank Corp. Chief Economist Robert Dan J. Roces said that the BSP is likely to keep rates steady, influenced by the “prevailing weakness of the Philippine peso and anticipation of pronounced disinflation not occurring until the end of the third quarter of 2024.”

“We think the inflation pressure and the weak currency will continue to constrain the capability of the BSP to cut the rate,” Sunny Liu, lead economist at Oxford Economics, said in an e-mail.

The peso weakened to a 19-month low on Friday, closing at P58.80 per dollar. The local unit depreciated by two centavos from its P58.78 finish on Thursday.

This was its worst finish since its P58.80 per dollar close on Nov. 3, 2022.

“The peso’s fragility, exacerbated by external economic pressures and capital outflows, makes a compelling case for maintaining higher interest rates to support the currency and mitigate potential inflationary pressures from further depreciation,” Mr. Roces said.

Meanwhile, analysts said that the US Federal Reserve’s latest signals would also impact policy decisions by the BSP.

“Number one driver for the BSP to move, I believe, is still what the US Fed wants to do,” Union Bank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said in an e-mail.

“We see this around the world among global central banks seemingly hesitant to start cutting rates ahead of the US Fed and I do not expect the BSP to be no different,” he added.

The US central bank earlier this month left its policy rate unchanged at 5.25%-5.5% for a seventh straight meeting.

Fed officials are now pricing in just one rate cut this year, compared with expectations of three cuts previously. They also signaled that policy easing could be pushed back to as late as December.

Ms. Tan said that the delay in the Fed’s first rate cut would add to the case for the BSP to stand pat at its upcoming meeting.

“Furthermore, the Federal Reserve’s recent monetary policy pronouncements could also influence the BSP’s stance, as synchronized actions may be necessary to manage cross-border financial stability and prevent disruptive capital movements,” Mr. Roces said.

“Hence, a pause in rate changes would provide BSP with an opportunity to assess the impacts of global monetary shifts while addressing domestic economic vulnerabilities linked to currency performance and delayed disinflation,” he added.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that if there are signals of a Fed cut by September, the BSP can start cutting rates in August as there are no other rate-setting meetings in the third quarter.

“We assume that the Fed will ease by 25 bps each in September and December. We also believe that the BSP should not cut rates ahead of the Fed or else risk further exchange rate weakness,” Philippine National Bank economist Alvin Joseph A. Arogo said in an e-mail.

“We expect BSP to wait until headline inflation stays well within the 2-4% target range for a few months before starting cutting,” Zamros Bin Dzulkafli, economist at Maybank Investment Banking Group, said in an e-mail.

BSP Governor Eli M. Remolona, Jr. earlier said that the central bank can begin cutting rates as early as August.

“Lower power prices and slower annual increases in rice prices for June may actually lead the BSP to increasingly hint on an August rate cut. If the July headline inflation print falls below 4%, BSP may gain enough confidence to hint on another cut in October,” Mr. Neri said.

Mr. Arogo said that the recent tariff reduction would also help inflation settle within the target.

President Ferdinand R. Marcos, Jr. last week issued Executive Order No. 26 which updates the tariff rates on various commodities, including rice. The tariff on rice imports was slashed to 15% from 35% until 2028, in a bid to tame rice prices.

“Any local policy rate cut would also be a function of the inflation (likely to be within the BSP inflation target as made more possible with the reduction on rice import tariffs) and also a function of the behavior of the US dollar/peso exchange rate that has an effect on import prices and overall inflation,” Mr. Ricafort added.

On the other hand, Mr. Neri said that the BSP may be unable to cut if second-quarter gross domestic product (GDP) growth surprises on the upside; the Fed continues to delay its policy easing; and if the peso further sinks to the P60-per-dollar level.

PPA to hike cargo fees by 16%, says Philexport

PHILIPPINE STAR/WALTER BOLLOZOS

By Justine Irish D. Tabile, Reporter

THE PHILIPPINE PORTS Authority (PPA) will be increasing cargo handling fees by 16% at the Manila ports by August, the Philippine Exporters Confederation, Inc. (Philexport) said in a bulletin.

According to Philexport, the increase was confirmed by PPA Manager for Commercial Services Mark Jon S. Palomar’s letter in response to Philexport’s petition “to defer cargo handling tariff hikes until the export industry has recovered.”

Citing Mr. Palomar’s letter, Philexport said that the hike in fees was approved by the PPA board of directors during its regular meeting on May 28.

This involves a 16% increase in cargo handling tariffs at the Manila South Harbor and the Manila International Container Terminal (MICT).

Manila South Harbor is operated by Asian Terminals, Inc., while the MICT is operated by International Container Terminal Services, Inc.

“[The increase] is based on the consumer price index adjustment factor from 2020 to 2023 considering the relevant provision of the Terminal Operators Contract with the Authority,” Philexport said, citing Mr. Palomar’s letter.

The Philippines’ annual average inflation rate stood at 6% in 2023, higher than the 2022 annual average inflation rate of 5.8%.

The increase, which will be implemented no earlier than Aug. 5, will be executed in two tranches.

The first tranche will involve a 10% increase in cargo handling fees. The second tranche, which will involve a 6% increase, will be implemented six months after the first tranche takes effect.

According to the export group, it has been opposing, together with the Export Development Council, any cargo handling rate increases at Philippine ports.

“The PPA has a share in cargo handling revenues generated by cargo-handling contractors and port-related service operators,” Philexport said.

“Thus, the approval of any cargo handling tariff hike constitutes a ‘conflict of interest’ as the PPA, being the regulator, also benefits from its own regulation, giving the agency the incentive to increase the rate to improve its financial health,” it added.

Sought for comment, Philippine Chamber of Commerce and Industry Chairman George T. Barcelon said that the business group does not think the PPA should implement any hike in fees at this time.

“The PPA at this point in time should not be increasing their service charge because this would be challenging to the importers and exporters who are already facing the increase in shipping costs,” Mr. Barcelon said in a phone interview.

“I don’t think it would be prudent for them to increase… Maybe this is not the right time because businessmen are already having challenges,” he added.

Mr. Barcelon said importers and exporters are already facing higher shipping costs due to geopolitical tensions in the Middle East.

“If you will notice, this week, there will be an increase in oil prices. All of this, somehow, would be passed on to consumers… and this might affect our inflation,” he added.

Pump prices for petroleum products are expected to climb this week, driven by “continued geopolitical tensions and supply risks,” according to the Department of Energy.

Inflation rose 3.9% in May, the fastest rise since November.

British Chamber of Commerce Philippines Executive Director Chris Nelson said on Sunday that the increase is “government-mandated” and reflects the inflation uptrend over the last three years.

“It’s based on the last three years of inflation, so if inflation drops, then obviously going forward, the increase should be less,” Mr. Nelson said in a phone interview.

But more than the increase in cargo handling fees, Mr. Nelson said the bigger challenge that companies face today is the “exceptionally high” shipping rates.

“So, look, it’s a mandated increase by the government. It covers inflation, (which) we understand. But if you look at the cost in the system, what’s more of a challenge for exporters and importers is actually the shipping rates, which are, again, very high,” he added.

The pending increase also comes after the 32% increase in storage charges for foreign containerized cargoes.

“Trade groups, including Philexport, had also opposed the increase of 32%, noting it was too high and would hurt the economy and the stakeholders already facing inflation and a weak global economy,” the group said.

The PPA implemented an increase in storage fees as well as a surcharge for the storage of reefer containers on Jan. 6, despite calls from the business sector to defer or reconsider the increase last year.

Meanwhile, other chambers that opposed the proposal include the American Chamber of Commerce of the Philippines, Inc., the German-Philippine Chamber of Commerce and Industry, and the European Chamber of Commerce of the Philippines.

Asked to comment, the PPA has yet to respond to BusinessWorld’s inquiry as of press time.

Philippine growth seen running ‘below potential’

Moody’s Analytics said the Philippines’ gross domestic product (GDP) growth is expected to average 5.9% this year. — PHILIPPINE STAR/MIGUEL DE GUZMAN

THE PHILIPPINES is expected to be the second-fastest growing economy in the Asia-Pacific (APAC) region this year, although expansion is “below potential,” Moody’s Analytics said.

In a report, Moody’s Analytics said the Philippines’ gross domestic product (GDP) growth is expected to average 5.9% this year, just behind India (6.8%) but ahead of Vietnam (5.8%), Indonesia (5.2%), and China (4.9%).

“Rising exports and stronger domestic demand have driven better-than-expected growth across most of the region in the first quarter,” Moody’s Analytics said. “Stronger household consumption also contributed to output gains.”

The forecast is slightly below the government’s 6-7% growth target, but faster than the Philippine GDP growth of 5.5% in 2023.

The economy expanded by 5.7% in the first quarter.

National Economic and Development Authority Secretary Arsenio M. Balisacan earlier said that GDP growth must average 6.1% in the succeeding three quarters to meet the government’s target.

Moody’s noted that the Philippines’ economic growth is still below pre-pandemic levels.

“Output in the ASEAN (Association of Southeast Asian Nations) group of economies is more than 6% behind the pre-pandemic trend, with the Philippines and Thailand faring the worst (GDP in both countries is more than 10% below pre-pandemic levels),” it said.

Moody’s Analytics said that the APAC economy is “outperforming but underachieving.”

“Economies in the region are doing better than most economies worldwide. But with growth in many countries running below potential, it would be premature to say that the region is out of the woods,” it said.

It forecasts the APAC region to grow by 3.9% in both 2024 and 2025.

“Key challenges in the months ahead are unsteady foreign demand, lingering inflation, and a delayed easing of monetary settings,” it said.

“A fresh uptick in commodity prices would stoke inflation and prompt monetary policy tightening that would weigh heavily on the region’s economy,” it added.

For 2025, Moody’s Analytics sees the Philippines expanding by 6%. This would make it the third-fastest growing country in the region, after India and Vietnam (both at 6.5%).

The latest forecast for the Philippines also falls below the government’s 6.5-7.5% target band for next year.

INFLATION
Meanwhile, Moody’s said it expects inflation to average 3.6% this year. This is a tad higher than the Bangko Sentral ng Pilipinas’ (BSP) 3.5% projection for 2024.

It sees inflation easing to 3.3% next year, matching the BSP’s baseline forecast.

“Inflation is a key factor underpinning our forecast over the next 12 months. Consumer price inflation in the region is slowing, but progress has been uneven. Price pressures have eased in developed and developing Asia-Pacific economies,” Moody’s said.

“But while inflation in developing economies is broadly in line with central bank targets or pre-pandemic averages, it is a bit higher than central banks in developed economies would like it to be.”

Headline inflation picked up for a fourth straight month to 3.9% in May. However, this was the sixth straight month that inflation settled within the BSP’s 2-4% target band.

“For the region’s central banks, exchange rates are a primary concern. Given expected rate cuts by the US Federal Reserve Bank (we look for a cut to the federal funds rate in September), attention this year has focused on when central banks in this region will ease monetary settings,” it added.

The BSP has kept its benchmark rate steady at 17-year high 6.5%. From May 2022 to October 2023, it raised rates by a total of 450 basis points to tame inflation.

The Monetary Board is set to meet on Thursday for its next policy review. A BusinessWorld poll of 15 analysts said they expect the central bank to stand pat at its meeting. — Luisa Maria Jacinta C. Jocson