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Amendments to AMLA sought

REUTERS

By Luisa Maria Jacinta C. Jocson, Senior Reporter

THE ANTI-MONEY Laundering Council (AMLC) is pushing amendments to the Anti-Money Laundering Act as part of its next steps to ensure the country stays out of the Financial Action Task Force’s (FATF) “gray list.”

These amendments aim to align the Philippines’ law with international standards, such as the enhanced monitoring of virtual asset service providers (VASP).

“As part of the preparations for the forthcoming mutual evaluation, the AMLC is currently undertaking a review of the Anti-Money Laundering Act of 2001 (AMLA), as amended,” it said in an e-mail to BusinessWorld.

“With the country’s recent exit from the FATF gray list, this initiative is essential in ensuring sustained compliance with international standards and preventing any potential relisting.”

In February, the FATF removed the Philippines from its list of jurisdictions under increased monitoring for “dirty money” after over three years or since June 2021.

The next assessment is slated for 2027, when the FATF will verify if the anti-money laundering measures are being sustained and still in place.

“As part of this initiative, a set of proposed amendments has been formulated to enhance the provisions of the AMLA,” the AMLC said.

The proposed tweaks to the AMLA would “address the technical compliance requirements arising from the updated FATF standards.”

These include the authority to temporarily suspend transactions and the designation of VASP as covered persons under the revised international standards and FATF recommendations, it added.

The FATF said in its latest recommendations that countries must ensure VASPs are regulated for AML/CFT (countering the financing of terrorism) purposes. These providers must also be licensed or registered, as well as subject to effective systems for monitoring.

Virtual assets, also called crypto assets, refer to “any digital representation of value that can be digitally traded, transferred or used for payment.” However, these do not include digital representation of fiat currencies.

“Without proper regulation, virtual assets also risk becoming a safe haven for the financial transactions of criminals and terrorists,” the FATF earlier said.

The proposed amendments also aim to “ensure its continued effectiveness in addressing emerging threats.”

It will also ensure the alignment with international standards on its AML/CFT/CPF (countering proliferation financing) regime, as well as address gaps identified in previous FATF reports.

While AMLC gave no timeline for the proposed amendments to the AMLA, this is likely to be tackled by the 20th Congress, which will formally open in late July. 

In 2002, the FATF blacklisted the Philippines for having no legal anti-money laundering framework. It was removed from the blacklist a year later after the passage of the AMLA.

The AMLA criminalizes money laundering, relaxes tight bank deposit secrecy laws, imposes requirements to better track transactions, and provides for international cooperation, among others.

RISK ASSESSEMENT
Meanwhile, the AMLC is currently conducting a National Risk Assessment (NRA), with a draft expected to be completed within the year.

“The NRA aims to evaluate potential money laundering threats and vulnerabilities affecting our country,” it said.

“Through the NRA, we will be able to adopt measures to address determined risks. This will ensure the sustainability of our country’s AML/CFT/CPF regime.”

The AMLC said the results of the risk assessment aim to guide government agencies in their preparations for the forthcoming mutual evaluation.

Aside from the ongoing NRA and proposed AMLA amendments, the AMLC said it is working on other initiatives after the Philippines’ exit from the gray list.

“Systems have been institutionalized to prevent another FATF gray-listing,” it said.

Malacañang last year issued an executive order mandating all government offices to adopt the National Anti-Money Laundering, Counter-Terrorism Financing, and Counter-Proliferation Financing Strategy 2023-2027.

“Likewise, the AMLC is consistently coordinating with relevant government agencies to ensure that the improvements made in our AML/CFT/CPF framework are continuously implemented and sustained.”

Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms, said that even with the gray list exit, money laundering risks still exist.

“The truth is money laundering is alive and well in the Philippines despite our exit from the gray list. It’s also an open secret that banks tolerate it,” he said via Messenger.

Mr. Sta. Ana said that the “shadow economy” in the Philippines accounts for about one-fourth or one-third of gross domestic product (GDP).

“That’s pretty high and that means money laundering is prevalent. I think the most effective solution is to lift the Bank Secrecy Act,” he added.

Earlier data from Moody’s Investors Service showed that from 2018 to 2023, the Philippines was among the top five countries in Southeast Asia with money laundering activity events added over the five-year period. The number of money laundering events added in the Philippines jumped by 45% from 2022 to 2023.

Banks told to monitor negative news on clients

The main office of the Bangko Sentral ng Pilipinas in Manila. — BW FILE PHOTO

THE BANGKO SENTRAL ng Pilipinas (BSP) is reminding its supervised institutions to monitor negative media reports as part of customer due diligence, in an effort to check for potential money laundering risks.

“All BSP-supervised financial institutions (BSFI) are reminded to incorporate Negative Media Report (NMR) screening as an integral procedure in the conduct of customer due diligence,” it said in a memorandum, adding this would complement ongoing transaction monitoring system and processes.

The central bank defines NMR as “published or televised adverse news, advisories, and/or reports on certain individuals and entities.”

“NMR related to possible money laundering predicate offenses, terrorist financing, and proliferation financing risks may trigger further review or look back on customers’ transactions and activities, particularly those subject of such NMRs.”

The BSP said that BSFIs must adopt policies and procedures to screen these negative news, including updating their institutional risk assessment.

Covered financial institutions should update their institutional risk assessment on newly identified financial crime threats and emerging trends that could have an impact on their products and operations, as well as other developments that could affect their operations, the BSP said.

BSFIs must consider all relevant risk factors, such as the institutional level of exposure to the subjects of negative information or reports and those who may be involved in illegal activities, it added.

They must also keep an updated list of sources of negative media reports, such as news articles, public registers, court/congressional/Senate records, as well as publicized hearings and deliberations.

A database of persons and entities that are the subject of these negative media reports should also be maintained, the BSP said.

“A BSFI shall develop means or measures to reasonably assess the credibility of these NMR sources and use the same for the conduct of ongoing monitoring,” it added.

Meanwhile, the BSP also noted customer due diligence and transaction monitoring processes must integrate NMR screening and scrubbing.

“To ensure holistic investigation, screening and scrubbing shall extend to ultimate beneficial owners and authorized signatories of juridical customers, as well as related parties/interests and counterparties involving material and significant transactions.”

BSFIs shall develop an NMR handling framework that is consistent with the board’s risk appetite and strategies.

It must also clearly define “material and significant” transactions considering risk factors, such as materiality of outstanding exposures; historical transactions; the relevance and magnitude of the NMR; and the presence of other attendant suspicious circumstances.

If warranted, a BSFI may conduct enhanced monitoring and transaction review for possible risk reassessment, risk-based account management, and suspicious transaction and risk event reporting depending on the results of the NMR investigation.

“A BSFI shall identify the action that may be triggered by the results of the NMR investigation, whose range shall be calibrated based on the severity of the results,” it said.

These include flagging the customer’s account for ongoing monitoring and periodic enhanced due diligence, account restriction, or termination of the relationship.

“A BSFI shall analyze the significance of NMRs and assess the impact of the possible operational, compliance, legal, concentration and reputational risks brought by clients subject of NMRs,” the central bank said.

Institutions must escalate and report significant risks, including Anti-Money Laundering Council inquiries or freeze orders, to their board of directors and senior management, it added. 

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said this effort shows proactive and dynamic monitoring by the BSP against potential “dirty money” risks.

“Thus, also minimizing the risk of asymmetric information and better due diligence and being more anticipatory in the management of these risks,” he added.

In February, the Financial Action Task Force removed the Philippines from the “gray list” or jurisdictions under increased monitoring for dirty money risks. — Luisa Maria Jacinta C. Jocson

Ayala Corp. secures SEC nod for P20-billion share offer

GARDENCOURT RESIDENCES is a development within Ayala Land’s 74-hectare ARCA South estate in Taguig. — AYALALAND.COM

THE Securities and Exchange Commission (SEC) has approved Ayala Corp.’s preferred share offering of up to P20 billion.

In a meeting held on May 27, the Commission En Banc rendered effective the registration statement of Ayala Corp., the corporate regulator said in an e-mail statement on Wednesday.

The offering consists of the re-issuance of 5 million preferred B shares, with an overallotment option of up to 5 million additional shares, both priced at P2,000 per share.

Ayala Corp. expects to raise up to P19.86 billion in net proceeds if the overallotment option is fully subscribed.

Proceeds from the offer will be used to repay short-term bank loans, and for general corporate purposes and capital expenditures.

The latest draft prospectus dated May 20 showed that the initial dividend rate setting date is Wednesday, May 28, while the offer period is scheduled from June 2 to June 6.

The preferred shares will be re-issued and listed on the main board of the Philippine Stock Exchange on June 18. Trading is expected to commence on the same date.

Ayala Corp. engaged BPI Capital Corp., BDO Capital and Investment Corp., Chinabank Capital Corp., First Metro Investment Corp., PNB Capital and Investment Corp., RCBC Capital Corp., and Security Bank Capital Investment Corp. as joint lead underwriters and bookrunners for the offer.

“For sure, there is demand for this because it is Ayala Corp. But of course, investors want a competitive yield,” DragonFi Securities, Inc. Equity Research Analyst Jarrod Leighton M. Tin said in a Viber message.

“Ayala is a sterling name in the capital markets, so we expect this offering to be well received by institutional and retail investors. This is an opportunity for investors to deploy cash in high quality preferred shares ahead of potential Bangko Sentral ng Pilipinas rate cuts in the next several months,” China Bank Capital Corp. Managing Director Juan Paolo E. Colet said in a Viber message.

For the first quarter of 2025, Ayala Corp. reported a 4% decline in net income to P12.6 billion, primarily due to weaker contributions from its power and telecommunications units. Ayala Corp. shares fell by 1.46% or P8.50 to close at P575.50 apiece on Wednesday. — Revin Mikhael D. Ochave

SM City Laoag to open as SM Prime’s 88th mall

LISTED SM Prime Holdings, Inc. will open SM City Laoag in Ilocos Norte on May 30, marking the real estate developer’s 88th mall in the country.

Located near Laoag International Airport, the three-level SM City Laoag has more than 51,000 square meters of gross leasable space, SM Prime said in a statement on Wednesday. It is the first SM mall in Ilocos Norte.

SM Prime said SM City Laoag is opening with 90% of its space already awarded to lessees.

The mall is projected to generate about 4,000 local jobs across retail, operations, and support services.

SM City Laoag features tenants such as SM Store, SM Supermarket, SM Cinema, Ace Hardware, Pet Express, Miniso, and BDO. It also includes retail and lifestyle brands like Levi’s, Columbia, Adidas, Watsons, and Parfois.

The mall will also host global and local dining concepts such as TGI Fridays, Vikings, Marugame Udon, Café Amian, and Milk Pot.

SM City Laoag also has a central open-air park called “Dap-ayan,” named after the Ilocano word for gathering place. It will serve as a community space for events and leisure.

“The opening of SM City Laoag reinforces our commitment to bring modern, accessible and community-oriented retail experiences to underserved but fast-growing areas,” SM Prime President Jeffrey C. Lim said.

“We’re excited to support the region’s economic momentum,” he added.

Meanwhile, SM Prime said it is studying a complementary hotel development in Laoag City to capitalize on the area’s growing tourism and meetings, incentives, conferences, and exhibitions potential, expanding its footprint beyond retail in Northern Luzon.

SM Prime earmarked P100 billion in capital expenditure (capex) this year.

Of the total capex, P67 billion will fund SM Residences and integrated property developments, P21 billion will support the expansion of SM malls’ gross floor area, and P12 billion will be allocated to the office, hospitality, and meetings, incentives, conferences, and exhibitions businesses.

By the end of the year, the company expects its mall portfolio’s gross floor area to surpass 8 million square meters.

SM Prime shares dropped by 0.22% or five centavos to P22.95 apiece on Wednesday. — Revin Mikhael D. Ochave

Cebu Pacific to lease aircraft to Saudi carrier Flyadeal

CEBU PACIFIC AIRBUS A320 — WIKIMEDIA.ORG

BUDGET AIRLINE Cebu Pacific will lease two of its aircraft to Saudi Arabia’s low-cost carrier Flyadeal as part of a new partnership between the two companies.

“With Cebu Pacific’s growing fleet, we seek to maximize the potential of our increased capacity through all months of the year. The utilization of our capacity by other carriers during our lean season is a way of achieving that,” Cebu Pacific Chief Executive Officer Michael B. Szucs said during a media briefing on Wednesday.

Under the arrangement, the Gokongwei-led carrier will lease two Airbus A320 aircraft to Flyadeal during its peak season from June to August, which coincides with Cebu Pacific’s lean period.

Cebu Pacific is also assessing the possibility of wet-leasing Flyadeal’s A320s during the high-demand winter season in Southeast Asia toward the end of the year.

“Cebu Pacific’s lean season is our peak season. Their low season is really our high, so that is the original premise [of this agreement],” Flyadeal Chief Executive Officer Steven Greenway said.

Mr. Szucs said the initial flights under the arrangement will begin in June and run until August, after which the aircraft will be returned to Cebu Pacific.

“This was the starting point for wide-ranging commercial discussions covering a broad range of areas including more immediate needs of wet-leasing aircraft for Flyadeal’s busy upcoming summer season,” Mr. Greenway said.

In addition to the aircraft, Cebu Pacific will also deploy its pilots, cabin crew, and maintenance personnel as part of the agreement.

“We have to operate it with the cabin crew. Our crew will be operating throughout,” Mr. Szucs said.

In October 2024, Cebu Pacific finalized a P1.4-trillion ($24 billion) order with Airbus SE for up to 152 aircraft.

The airline received 17 aircraft deliveries in 2024, enabling the expansion and development of its domestic hubs.

Cebu Pacific expects seven more deliveries this year, after receiving its first aircraft for 2025 in March. The carrier is projected to operate a fleet of 100 aircraft by yearend.

As of May, Cebu Pacific flies to 37 domestic and 26 international destinations across Asia, Australia, and the Middle East. — Ashley Erika O. Jose

Dinner and a show(room)

MULTI-AWARDED chef Tony Boy Escalante of Antonio’s.

IT’S NOT every day that one gets to eat at Antonio’s in Tagaytay, nor is it an everyday occasion to be surrounded by the fridges and ovens of Sub-Zero and Wolf. The three come together in a pop-up at Sub-Zero and Wolf’s Greenbelt showroom called The Table, running from May 26 to June 10.

On May 27, BusinessWorld and a host of media and VIP guests got a taste of the experience. The venue was reassuring Antonio’s founder, Antonio “Tony Boy” Escalante, and his team chopped, seared, and flambéed surrounded by some of the world’s most trusted kitchen appliance brands.

THE MEAL
The meal began with a lacy shrimp cracker, like a tuile, with a strong flavor of Parmigiano Reggiano, sprinkled with crunchy shrimp bits — the salty flavor jolted the tongue awake, but Marie de Moy NV Brut Champagne massaged the tongue again to calm it down. This was served next to a Pão de queijo, a Brazilian cheese roll that was crispy on the outside, and flaky and pillow soft on the inside — we’d have asked for more, but several other guests wanted some too. The next course was a series of amuse-bouches: Smoked Herring on a Smoked Herring Mousse topped with ikura, a Foie Gras Cornet with Raspberry Pearls, and Emulsified Oysters with seaweed and caviar from Nomad Caviar. The herring mousse creates an illusion of being solid and due to its very forward taste, an illusion broken by the pops of the salmon roe. The foie gras cornet, unfortunately, paled next to the seafood offerings — the herring’s effect was replicated in the oysters (with a texture like mayonnaise). We might pronounce the effect of the oysters to be too rich — however, we did have two servings, and that’s probably our fault for having more than a taste.

The next course was a Tartar of Maya Maya with a veil of Benguet Passionfruit-Tamarillo; then coconut, sweet peppers, and coriander oil. Visually stunning in yellow and green, we did pick off the fruity veil to enjoy what amounted to a very fancy kilawin (fish “cooked” in acid) — it is a mark of its excellence that we finished the whole plate despite our aversion to coconut, the sharp onion and chili in the fish defeating what we think was the cloying and too-rich flavor of coconut milk. The wine pairing, a Jurtschitsch Löss Grüner Veltliner 2023 from Austria, made the fish shimmer with notes of peach and pear.

Flame-torched Toro (fatty tuna) followed this, with a relish of Kalamata olives, sun-dried tomato, fregola, tuna roe, and Parmesan foam. The toro, usually a delicate delicacy, gained muscle with its garnish, taking on the flavors of the Mediterranean. The wine pairing, a Chateau De Chamirey, Mercurey, en Pierrelet, 2022, proved to be the best in the series, with a smell like frankincense and a mild flavor akin to sweetcorn — unfortunately, the strong tastes and the rich textures in the fish rendered it invisible.

A palate cleanser introduced us to a new treat: a Berry Granita made with Taogtog from Benguet. The berry grows wild there, and curse the day somebody successfully cultivates it: the berries taste exactly like cola, and we’re afraid we’ll waste away popping one after the other.

We may have expressed some reservations about the other courses, but there’s one thing Mr. Escalante will always get right: beef. The final savory course was a Tajima Striploin with a pumpkin and potato gratin, peas and beans, and a tasteful amount of pepper sauce. The beef was a hybrid of Kobe and Australian Wagyu cows: this resulted in the perfect balance of meat and fat marbling, not to mention a stronger flavor. This was paired with a Chateau La Nerthe, Châteauneuf-du-Pape Rouge, 2020, with a refined, woody scent and a slightly savory taste. With the perfectly seared striploin, a drop was just the perfect garnish.

We didn’t think that Mr. Escalante could top this, but he gave us a choice from four ice creams: whisky with dates and pecans, dark chocolate, roasted strawberries, and panna. We took all of them. We made the mistake of eating the whisky ice cream first — in all its rich indulgence with a sharp aftertaste from the liquor — so the rest of the flavors paled in comparison. Not that they didn’t try: the panna ice cream was topped with olive oil and salt; and we didn’t think strawberry ice cream could still be improved with a good roasting.

BIRTHDAYS
At the end of the dinner, the Sy family which distributes Sub-Zero and Wolf in the Philippines sang a “Happy Birthday” to the chef, who turned 59 on Wednesday.

Mr. Escalante’s Antonio’s in Tagaytay, which he started in 2002, became the first restaurant in the Philippines to make it to the Asia’s 50 Best Restaurants list in 2015. Since then, the Philippines has been a regular on the list. The Tagaytay fine dining scene he pioneered has seen multiple restaurants of increasingly high caliber open in the resort town. He says, quite humbly however, “I never told my people that ‘every year we have to win.’ We just have to work harder and harder and maintain. But if it comes, it comes.”

The chef started out studying dentistry, then shifting to a career as a flight attendant, then opening the restaurant in the 2000s, to much acclaim. In recent years, the chef, once reluctant to leave Tagaytay, has opened multiple outlets down in the big city. His café, Breakfast at Antonio’s, has a branch in Robinsons Magnolia; while Azela by Balay Dako has a city pied-à-terre in Robinsons in Ermita. Meanwhile, Antonio’s main city home is in the car showroom of PGA Cars along EDSA. He’s planning another Balay Dako up another hill, in Antipolo.

“I don’t know why I love Manila now,” he says, with a tone that suggested he surprised even himself. “My happiest place now is Manila. Before, I told myself, I’ll never, never. But I don’t know what happened,” he said.

“If I go to Tagaytay, after I work, even if it’s 12 o’clock, I’ll go down (to Manila). I don’t even sleep in my house — my beautiful house there. I’m here 90% (of the time),” he said in a group interview.

He has also since opened Pedro the Grocer, a retail food outlet. He recalls that when he first started, his mentors would ask him why he made his own bacon and other meat products. “What will I do? Buy? And now, it’s another business.”

Asked about Sub-Zero and Wolf equipment, he says he likes his oven with a steamer function. However, he speaks more fondly about his fridge and wine cabinet: how the fridge prolongs the life of his girlfriend’s bouquets, for example. Or how the wine cabinet holds his favorite red wines, or the fridge, again, storing his favorite guilty pleasure: butter. “I love butter. I have different butters,” he said. “I don’t spread my butter. I just cut, and eat it like cheese.”

A year closer to 60, he does reflect on an eventual retirement: “I just want more time to myself.” Someone pointed out that despite this, he has been opening new restaurants left and right. To that, he said, “It’s more of developing people, and the way you develop people is to trust them.”

Reservations for Antonio’s pop-up can be made through Antonio’s by contacting 0939-752-3291. For full booking details, you may visit thetable.subzero-wolf.com.ph. — Joseph L. Garcia

Strong AI governance may drive value creation for PHL businesses

STOCK PHOTO | Image by DC Studio from Freepik/THIS RESOURCE WAS GENERATED WITH AI

By Beatriz Marie D. Cruz, Reporter

PHILIPPINE COMPANIES must prioritize crafting governance frameworks for artificial intelligence (AI) use to effectively reap these technologies’ benefits while managing potential risks, according to the country’s telecommunication giants.

“[AI] governance is often treated like a side dish. It’s an afterthought because we can’t attach revenue to governance,” Derick Ohmar Adil, senior director for AI Data Governance at Globe Telecom, Inc., said during a panel discussion at the BusinessWorld Economic Forum last week.

Mr. Adil said strong AI governance is like “good parenting” as it ensures that employees responsibly exercise the freedom to use AI in their work.

“Your governance [policies] will make sure that your AI is not a liability, but more of a force multiplier.”

Patricio S. Pineda III, PLDT Inc. senior vice-president and head of Enterprise Business Group, said an effective governance policy can help ensure that AI adds value to a company.

“The truth of the matter is, your employees are already using AI whether you’re paying for it or not,” Mr. Pineda said.

When coming up with AI use policies, firms must ensure that there is a balance of voices, he said. “You’ve got to have the business and innovation [sections] pushing for new products to market because that’s what customers demand, but at the same time, you’ve got to have knowledgeable people on the governance and risk side.”

The Philippines improved by nine places to 56th of out 188 countries in the 2024 Government AI Readiness Index published by Oxford Insights.

AI adoption remains varied across Philippine industries, with data-intensive sectors like telcos and banking leading the way.

Meanwhile, analysts have said there is massive untapped potential for AI in the agriculture, healthcare, and logistics sectors.

Mr. Adil said small and medium enterprises also remain unsure where or how to start their AI journey.

“I think that’s what’s lacking with Philippines right now. What we need to do is put together a national strategy to know where we’re heading [in terms of AI adoption],” he said. citing countries like Singapore and Vietnam that have invested heavily in AI talent and innovation.

Mr. Pineda added that the rise of AI and cloud computing technologies has pushed companies like PLDT to cater to the demand for data centers and internet connectivity with stronger capacity.

“A lot of the data that we will be working with will probably be coming from abroad, and a lot of our own data is being hosted with hyperscalers abroad,” he said.

PLDT’s construction of the Philippine link of the Asia Direct Cable aims to facilitate seamless data transfer to key hubs like Singapore, Hong Kong, Japan, Vietnam, Thailand and China. This is expected to increase PLDT’s international capacity by over 100 Terabits per second.

“It’s a lot of investment, but we believe we’re building ahead,” Mr. Pineda said.

Meanwhile, Mr. Adil also emphasized the need to embed security and privacy in companies’ AI adoption.

Around 85% of Philippine organizations reported AI-related security incidents last year, technology company Cisco said in its 2025 Cybersecurity Readiness Index report.

“AI [adoption] plus that ‘shift to the left’ mindset will make functions like security and privacy not a backend IT (information technology) function, but more of a design decision,” Mr. Adil said.

“I think with this AI era, trust is the new currency. Regardless of how good your AI solution is, if no one will trust it, no one will use it.”

Philippine companies should be more deliberate in their AI goals and consider their contribution to the broader economy, Mr. Adil added.

“We need to be able to invest in smarter, more grounded, local AI solutions that can help solve real issues like food security and education.”

Mr. Pineda said companies must work to understand AI to help unlock opportunities, drive productivity, and generate jobs.

“We can’t decide about what AI can do for companies or for the country if we don’t dig into it ourselves.”

Yields on term deposits go down on easing bets

BW FILE PHOTO

YIELDS on the Bangko Sentral ng Pilipinas’ (BSP) term deposits edged lower on Wednesday as the offer was oversubscribed amid expectations of further monetary easing.

Demand for the central bank’s term deposit facility (TDF) amounted to P154.854 billion on Wednesday, above the P110-billion offering as well as the P141.459 billion in bids for a P100-billion offer a week ago. This allowed the BSP to make a full award of its offer.

Broken down, tenders for the seven-day papers reached P78.28 billion, higher than the P60 billion placed on the auction block but below the P82.205 billion in bids for a P50-billion offering seen in the previous week. The central bank made a full P60-billion award of the tenor.

Accepted yields ranged from 5.49% to 5.5255%, a slightly lower band compared with the 5.5% to 5.5355% seen a week ago. With this, the average rate of the one-week term deposits inched down by 0.9 basis point (bp) to 5.5158% from 5.5248% previously.

Meanwhile, the 14-day papers fetched bids amounting to P76.574 billion, well above the P50-billion offer and the P59.254 billion in tenders for the same volume offer a week ago. The BSP awarded P50 billion in two-week papers as planned.

Banks asked for rates ranging from 5.5% to 5.545%, narrower than the 5.5% to 5.57% margin seen last week. This caused the average rate of the two-week papers to fall by 1.54 bps to 5.5299% from 5.5453% in the prior auction.

The BSP has not auctioned off 28-day term deposits since October 2020 to give way to its weekly offerings of securities with the same tenor.

The TDF and BSP bills are used by the central bank to mop up excess liquidity in the financial system and to guide market rates closer to the policy rate.

Term deposit yields were lower this week following fresh rate cut signals from the central bank governor, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“The peso exchange rate recently appreciated versus the US dollar to the best in nearly two years and global crude oil prices eased to among the lowest in more than four years or since April 2021, both of which would reduce importation costs and overall inflation that could support further monetary easing for the coming months,” Mr. Ricafort added.

BSP Governor Eli M. Remolona, Jr. last week signaled the possibility of two more rate cuts this year in “baby steps” or increments of 25 bps.

He added that a reduction will be on the table at the Monetary Board’s next policy meeting on June 19. After the June review, the policy-setting body’s remaining meetings are scheduled in August, October and December.

The BSP last month reduced benchmark interest rates by 25 bps to bring the policy rate to 5.5%.

The central bank has so far slashed borrowing costs by a total of 100 bps since it began its easing cycle in August last year.

Headline inflation slowed to an over five-year low to 1.4% in April, bringing the four-month average to 2%.

The peso last week hit near two-year highs as the dollar was under pressure after Moody’s Ratings cut the United States’ triple-A rating. It has since weakened anew as concerns over the US economy prompted bets that the Federal Reserve would prefer to stay cautious and deliver less rate cuts this year than initially expected.

Meanwhile, the world’s biggest oil exporter Saudi Arabia may cut its crude prices for Asian buyers in July to the lowest in six months, refiners said, tracking losses in benchmark prices driven by rising supply from OPEC+, Reuters reported.

The July official selling price for flagship Arab Light crude may drop by 40 cents to 50 cents to between 90 cents and $1 a barrel from the previous month, four Asian refining sources said in a Reuters survey.

Oil prices have tumbled since OPEC+ or the Organization of the Petroleum Exporting Countries and its allies such as Russia agreed to increase production by nearly 1 million barrels per day in April, May and June. — Luisa Maria Jacinta C. Jocson

Aboitiz targets to lift Bohol-Panglao airport capacity by 25%

ABOITIZ INFRACAPITAL,INC.

ABOITIZ InfraCapital, Inc., the infrastructure arm of the Aboitiz group, will take over Bohol-Panglao International Airport (BPIA) on June 16 and start a P4.53-billion expansion to raise capacity by 25%, from two million to 2.5 million passengers annually within two years.

“The modernization of BPIA is not just about upgrading infrastructure — it’s about enabling the continued rise of Bohol as a vibrant tourism and economic hub in the Visayas,” Aboitiz President and Chief Executive Officer Cosette V. Canilao said in a media release on Wednesday.

The company will implement a P4.53-billion investment plan, including the expansion of the passenger terminal building, installation of modern aviation systems, and enhancements to airside and landside facilities.

Aboitiz InfraCapital also targets increasing the airport’s capacity to 3.9 million passengers annually by 2030.

The concession agreement for the New Bohol-Panglao International Airport covers a 30-year period, encompassing upgrades, expansion, and maintenance from the start of turnover.

“This project reinforces our goal of elevating airport experiences while contributing to local economies,” Aboitiz InfraCapital President and Head of Airports Business Rafael M. Aboitiz said.

Aside from Bohol-Panglao, the group also manages Mactan-Cebu International Airport and Laguindingan International Airport.

The company said in April that it remains keen on taking over the operations and maintenance of other regional airports in the Philippines. — Ashley Erika O. Jose

RFM Corp. to hold 2025 Annual Meeting of the Stockholders virtually on June 25

 


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One World Deli goes to Alabang

OFFICIAL PHOTO OF ONE WORLD DELI ALABANG

PYC FOODS Corp. has expanded One World Deli’s world by opening its latest branch in Alabang on May 20. Located in a spacious, stand-alone building in Alabang West, which is actually in Las Piñas City, the deli-café-fresh market concept aims to bring the eat-healthy ethos to the south of the metropolis.

One World Deli features goods from around the world: award-winning French cheeses, fresh produce sourced locally from the likes of Silang-based Pedro Farms, and antibiotic- and hormone-free Angus and Wagyu beef from Jack’s Creek in Australia, to name a few.

The deli is a high-end supermarket, with items that can either be taken home or cooked on the spot and served in their dine-in area. Its menu features chef-crafted dishes like Truffle Adobo Garlic Fried Rice, which uses clean pork sourced from family farms in Bicol.

Of course, a fan favorite is the steak, care of Braveheart Foods, known for their premium small-batch Black Angus beef.

Founded in 2022, One World Deli developed not just a loyal following in Makati, but drew in residents from the south, according to PYC Foods Corp. President and founder Julio “Jun” Sy.

“This is for the southern community of Las Piñas and Muntinlupa residents that have been clamoring to be served,” he said at the opening. “Our mission is to provide the freshest, healthiest, and most delicious food that can bring genuine happiness.”

With its clean lines, warm lighting, and colorful shelves, One World Deli’s new Alabang outpost aims to be “a haven for Filipino shoppers in the middle class.”

“Beyond that, we aim to help farmers and small producers, some of whom actually live here in Las Piñas and Muntinlupa, and showcase them alongside world-class manufacturers whose excellent products we’ve brought here,” Mr. Sy said.

More branches are set to open within the next two years: in Timog Ave. in Quezon City, Bonifacio Global City in Taguig, and Tagaytay in Cavite.

“In this journey, we want to engage our customers with a continuous conversation to find ways to innovate, and fulfill our promise in making healthier and more joyful food experiences,” he said.

One World Deli Alabang is located at Alabang West, Daang Hari Road, Almanza Dos, Las Piñas City. — Brontë H. Lacsamana

Keep up the pressure

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With dust from the elections settled and a state executive revamp down to bureau/agency level under way, newly seated officials will hopefully lose no time turning their attention to development tasks at hand.

One nagging imperative that bedevils the bureaucracy at all levels is corruption — everyone’s favorite punching bag but against which we seem to be making little headway. So much has been said about this problem (I look forward to Pablo Virgilio S. Cardinal David’s keynote and exchange with businessmen on this issue at the Aug. 13 general membership meeting of the Management Association of the Philippines, or MAP), and yet months that pass add new dimensions and new perspectives to discussions.

Among others: casual conversations with members of various business groups on this matter bare one common observation: bribery that they personally have encountered has worsened over the past few years.

Chances are that many of us have been inured to not just the sight of but also to inconvenience caused by this disease, from substandard roads to poorly delivered public services.

In a way, I am glad that younger generations seem less resigned to grin and bear it whenever they encounter government inefficiency and/or petty corruption, not least due to the wider perspective (i.e., comparison with neighbors) they have gained from social media and other internet platforms they frequent. The apparent activism displayed by the youth in the recent mid-term polls may signal what could be a hopeful shift towards more discerning voter choices. Putting more qualified folks in office is key to improving our competitiveness as a country in terms of governance, compared to peers like Indonesia and Vietnam.

NOT ENOUGH
It will take quite some time before better choices of officials yield better policies and improved implementation/enforcement, but the fact that multilateral lenders and private sector groups at home have long flagged corruption — which gnaws at governance — as a key concern means there can never be enough improvements on this front… and the sooner, the better.

The International Monetary Fund, in its last annual health check on the Philippines (Article IV Staff Report), published in December last year, had cited the need to prioritize “efforts to reduce corruption” in order to close the country’s gaps with its Southeast Asian peers in terms of governance. This focus — coupled with “comprehensive reforms,” as well as better energy, transport and digital infrastructure — can be expected to “support higher investment and productivity,” and “significantly boost real GDP growth,” according to that report.

Groups like the Philippine Chamber of Commerce and Industry and the MAP have consistently flagged corruption as a key hurdle for doing business in the country, despite laws like Republic Act No. 3019, or the Anti-Graft and Corrupt Practices Act, and RA 6713, and the Code of Conduct and Ethical Standards for Public Officials and Employees, among others.

There are several government and private sector initiatives to imbue strategically placed officials with proper values, but many who take part in such undertakings easily slide back to old habits as soon as they resume the daily grind. Faced with their relapse, it’s almost instinctive to roll one’s eyes at the mere mention of “values formation.”

But perhaps the problem lies more in the general lack of a system that will both encourage perseverance in values needed to govern well as well as stop backsliding. Which is why the likes of Baguio City Mayor Benjamin “Benjie” B. Magalong and Pasig City Mayor Victor Ma. Regis “Vico” N. Sotto have focused on fixing procurement and other governance systems in their localities. In a television interview, Mr. Sotto cited the need for a system that would make it more attractive to do right and automatically distasteful (or costly) to engage in bribery.

Local reformers like these gentlemen are on to something, because it will take both carrot and stick to hammer governance principles into officials and to make these stick.

IN PLAIN SIGHT
Take Vietnam for example, which has been besting the Philippines in investment and various development metrics: it has been waging an unrelenting anti-corruption drive that has seen top/key personalities fall, including a president, some ministers, vice-ministers, and businessmen.

While that communist-run country lacks the civic space to allow the public to call erring officials to account, Vietnam outdid the Philippines in the 2024 Corruption Perceptions Index that placed the former 88th out of 180 countries and the latter at 114th. That index ranks countries yearly in terms of levels of public sector corruption as perceived by experts and businesspeople. To be sure, both the Philippines’ and Vietnam’s scores of 33 and 40, respectively, on a scale of 0 (very corrupt) to 100 (very clean) fall short of averages of 43 for the world and 44 for Asia and the Pacific. But the Philippines has shown a gradual — if erratic — decline in its score since 2014, when the country posted an all-time-high 38 points and placed 85th out of 175 countries ranked then.

There are enough studies directly linking corruption perception to foreign direct investment levels*, hence the need for us to match, if not beat, our competitors on this count.

Signs of corruption abound — from jeepneys plying roads at night with busted headlights, to smoke-belching public transport vehicles, to drivers who do not seem to know basic traffic rules (and killing pedestrians, bystanders, commuters, or other motorists at times), to substandard/poorly maintained roads and bridges, to simple road repairs inexplicably left unattended for weeks/months, to duplicate/redundant street signs, to primary suspects eluding arrest during raids on scam hubs, etc. Any one of these symptoms is like that lone cockroach or termite one finds on the kitchen counter at night: where there’s one in plain sight, there are hundreds of others scurrying in the dark.

Take the unending reports of birth certificates, drivers licenses, passports, and other official documents issued illegally to foreign criminals. Nearly a year since the revelation that over 1,000 birth certificates were issued to foreigners in 2018-2019 in the Davao region, news reports since last week told of at least two other foreigners who were arrested with Philippine driver’s licenses, birth certificates and other government documents.

Gosh, how many more of these people are out there?

This problem not only undermines our citizenship system but also erodes the integrity of government documents both domestically and abroad to the detriment of Philippine nationals, and could pose national security risks besides. Has anyone been charged here?

MAKE IT TOO COSTLY
Why not make an example of government personnel and officials who signed off on these illegally issued documents? Their signatures are all over the paperwork leading to the final certificates, so why not trace how deep/high the rot goes?

One need not name them publicly until they are dismissed from service and face cases in court. But isn’t it high time to force these bureaucrats to do their jobs properly (the image of a lazy corrupt clerk or supervisor waiting for his/her take for the day comes to mind) instead of mechanically and unmindfully (or worse) signing such documents?

Make it just too risky/costly for anyone to take part in such schemes, even if inadvertently (innocent but inept ones will be cleared by investigations eventually anyway).

This step may sound simple, even insignificant, compared to the whole gamut of graft and corruption across the country. But it is a good way to step up anti-corruption efforts and, at the same time, benefit the transacting public.

The question is: why don’t we hear more of this sort of simple clampdown happening? Are state managers blind, plain lazy, are they looking for dragons to slay in the corners of their offices, or are some of them actually involved themselves?

Do such small steps work? Of course they do! I recall conversations decades ago at a bribery-ridden bureau whose officials and agents held off acquisition of new properties (a new car here, a new house there) due to a stepped-up lifestyle check ordered by the top boss that time. A genuine no-nonsense drive against petty graft and corruption will produce the desired change in behavior if sustained.

But there’s the rub: the top boss has to set the tone and secure management buy-in. Otherwise, such campaigns won’t be credible, not only to the public but to government rank and file as well.

How high can such crackdowns go?

It turns out that there is an obscure executive order (EO) that defines “command responsibility.” Executive Order No. 226, issued by the late former president Fidel V. Ramos in February 1995, imposed this accountability system on “all government offices, particularly… all levels of command” in the police and other law enforcement agencies (the first time the doctrine of “command responsibility” was codified in this country, unless I am mistaken).

“Any government official or supervisor, or officer of the Philippine National Police (PNP) or that of any other law enforcement agency shall be held accountable for ‘neglect of duty’ under the doctrine of ‘command responsibility’ if he has knowledge that a crime or offense shall be committed, is being committed, or has been committed by his subordinates, or by others within his area of responsibility and, despite such knowledge, he did not take preventive or corrective action either before, during, or immediately after its commission,” that order reads in part.

The same order provides that “[a] government official or supervisor, or PNP commander, is presumed to have knowledge of the commission of irregularities or criminal offenses… when the irregularities or illegal acts are widespread in his area of jurisdiction… have been repeatedly or regularly committed within his area of responsibility, or… when members of his immediate staff or office personnel are involved.”

The Civil Service Commission was supposed to have come out with its rules and regulations implementing this EO in all government offices. At the same time, a few measures that sought to clearly apply the coverage of this order to other government offices failed to make it out of Congress.

This is like many other problems in this country: there probably are laws already in place to address them… it’s just that enforcement sucks or is plain non-existent. And that omission speaks volumes about the administrators in place.

Small steps like this one may not be headline-grabbing, but they do strike fear where governance values meet resistance.

And, provided these efforts are not ningas kugon (a flash in the pan), they should improve public services.

* Check out, for instance: Agnes Bénassy-Quéré, Maylis Coupet & Thierry Mayer, “Institutional Determinants of Foreign Direct Investment,” Centre for Prospective Studies and International Information, April 5, 2005; Mohsin Habib & Leon Zurawicki, “Corruption and Foreign Direct Investment,” Journal of International Business Studies, June 1, 2002; and Shang-Jin Wei, “How Taxing is Corruption on International Investors?” The Review of Economics and Statistics, Vol. 82, No. 1, The MIT Press, February 2000.

 

Wilfredo G. Reyes was editor-in-chief of BusinessWorld from 2020 through 2023.