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Gov’t fully awards T-bills even as rates mostly rise on CPI bets

RJ JOQUICO-UNSPLASH

THE GOVERNMENT made a full award of the Treasury bills (T-bills) it offered on Monday even as rates mostly rose amid expectations that Philippine inflation picked up slightly last month.

The Bureau of the Treasury (BTr) raised P15 billion as planned from the T-bills it offered on Monday as total bids reached P43.976 billion or almost thrice the amount on the auction block.

Broken down, the BTr borrowed P5 billion as programmed from the 91-day T-bills as tenders for the tenor reached P19.066 billion. The three-month paper was quoted at an average rate of 5.698%, 2.1 basis points (bps) lower than 5.719% seen last week. Accepted rates ranged from 5.67% to 5.71%.

The government likewise made a full P5-billion award of the 182-day securities, with bids reaching P11.91 billion. The average rate for the six-month T-bill stood at 5.904, up by 1.8 bps from the 5.886% fetched last week, with accepted rates at 5.895% to 5.913%.

Lastly, the Treasury raised the planned P5 billion via the 364-day debt papers as demand for the tenor totaled P13 billion. The average rate of the one-year debt inched up by 0.3 bp to 6.046% from the 6.043% quoted last week. Accepted yields were from 6.035% to 6.055%.

The BTr made a full award of its T-bill offer as the papers fetched yields “lower than the prevailing secondary market rates” and amid strong investor demand, it said in a statement.

At the secondary market before the auction, the 91-, 182-, and 364-day T-bills were quoted at 5.7356%, 5.9596%, and 6.0653%, respectively, based on PHP Bloomberg Valuation Service Reference Rates data provided by the Treasury.

“The higher rates awarded this week reflected expectations of an uptick in May domestic inflation due to be released on Wednesday,” a trader said in an e-mail.

A BusinessWorld poll of 16 analysts yielded a median estimate of 4% for the May consumer price index (CPI), within the Bangko Sentral ng Pilipinas’ 3.7-4.5% forecast for the month.

If realized, May inflation would be faster than 3.8% in April but slower than the 6.1% print a year earlier. This would also mark the sixth straight month that the CPI was within the central bank’s 2-4% annual target.

The Philippine Statistics Authority will release May inflation data on Wednesday (June 5).

T-bill rates mostly rose due to a weaker peso recently, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

On Friday, the peso closed at P58.51 per dollar, strengthening by 12.5 centavos from its P58.635 finish on Thursday, Bankers Association of the Philippines data showed.

Still, year to date, the peso has depreciated by P3.14 from its end-2023 close of P55.37 versus the greenback.

On Tuesday, the BTr will offer P30 billion in reissued 20-year Treasury bonds (T-bonds) with a remaining life of seven years and one month.

The Treasury wants to raise P180 billion from the domestic market this month, or P60 billion from T-bills and P120 billion via T-bonds.

The government borrows from local and foreign sources to help fund its budget deficit, which is capped at P1.48 trillion or 5.6% of gross domestic product for this year. — Aaron Michael C. Sy

A plastic-free future

CHRISTOPHER VEGA-UNSPLASH

A plastic-free future really starts with us — in our homes, in our place of work, and wherever we conduct business like stores and factories. We have already read about plastic leaching into our groundwater, and we hope for plastic-free fish and food, in general.

What we have not processed in our minds is that paper may not be the only solution to switching from plastics. We learned during a recent webinar organized by the Management Association of the Philippines (MAP) Environment Committee, that even paper is not as easily recycled as we thought it to be.

We had a good speaker in Crispian Lao, President of the Philippine Alliance for Recycling & Material Sustainability and Vice-Chair of the National Solid Waste Management Commission, about misconceptions related to recycling. I was so surprised to know that food boxes soiled with grease can no longer be recycled or fed to recycling mills. Instead, they end up in landfills along with unsorted trash. I also learned that paper cups used for takeout beverages are in the same situation. They cannot be recycled. Think about all the paper cups we use in cafes and take out delivery orders!

Mr. Lao further shared that plastic cups are easily recycled as are biodegradable plastic shopping bags (though I am all for using paper bags because they so easily degrade and are taken by recyclers to make them into recycled paper). The speaker agreed we need to mount an information campaign for consumer awareness on what is recyclable and what is not — in our country, that is. Our paper manufacturers and plastic factories using recycled materials are in need of raw materials, in this case, used paper, boxes, and recyclable plastic.

Our cities jumped the gun and banned the use of all plastics, so everyone switched to paper packaging. Especially during the pandemic lockdowns when “home delivery” was the only way to order food. Vendors used so much plastic and paper packaging to protect food lest they receive complaints about how it was packed for delivery. The e-commerce sites (e.g., Lazada and Shopee) use so much bubble wrap to protect the merchandise lest they receive complaints or requests to return or exchange. Imagine all the bubble wrap these outfits use — where will they go after you unwrap your orders? Apparently, this bubble wrap can be used by recyclers — but only if it is sorted along with other plastic materials.

There are collection points for plastic which we must be aware of. There are also collection points for e-waste or electronic waste. What MAP can do is to spread awareness about these drop off points in the city. Then we teach our staff and our households to segregate trash into recyclable and not recyclable trash.

But is a plastic-free future really possible? It starts with education and segregation. It is followed by infrastructure and supplies, like segregated waste cans in public places and private offices. It should be followed by an information drive which to this day is fragmented and lacking.

If we want to live sustainably, we must address it from the start of any cycle. Start with the design in mind. Then execution demands that we think of how the product will be disposed of and how we will be able to recycle most if not all the stuff we use.

This is applicable even for clothing. We should stop using fast fashion as these items will end up in landfills, too. Polyester clothing feels hot in our already hot weather. We should shift to cooler fabrics like cotton and linen.

Ultimately, what we need is to change our lifestyle habits — what we eat, what we wear, what we use — and help to make our future plastic-free and sustainable.

We can also start reducing our garbage for collection by our village, condominiums, or homeowners’ association which ends up in landfills anyway. How do we reduce our garbage? At home, we must segregate and teach all our staff to do so. In the office, we must segregate or have a Materials Recovery Facility or MRF.

Solid waste management is not for the government to work on alone. It is every citizen’s responsibility to do waste segregation and reduce waste if possible. We are running out of landfill space, and we are also not optimizing recyclable materials. Meanwhile, recycling mills lack materials to process because people do not segregate or sort usable trash from the non-usable.

What we need is basic education in achieving a circular economy from start to finish of our business cycle, no matter what trade we are in.

We thank MAP Environment Committee Chair Regie Casas — a solar king himself — for spearheading this initiative to teach consumers, like us, about Solid Waste Management. We thank Mr. Lao for an enlightening presentation, the recording of which is still up on MAP’s social media assets for replaying to our stakeholders.

Sometimes, we think that since the laws have already been made, that takes care of everything. But implementation is needed as with all good laws. And education is paramount if the whole citizenry is to be involved to solve our solid waste issues. How do we start? We start with ourselves and then cascade to our teams. But awareness is job No. 1.

We can dream of a plastic-free future and a sustainable environment if we start at home and in our offices with design in mind. Then execution demands that we think of how the product will be disposed of and how we will be able to recycle most, if not all, of the stuff we use.

 

Chit U. Juan is the co-vice-chair of the MAP Environment Committee. She is also the president of the Philippine Coffee Board, Inc. and Slow Food Manila (www.slowfood.com).

map@map.org.ph

pujuan29@gmail.com

Japan’s NRE says Philippines to boost overseas profit by 2031

FEDERALLAND.PH

By Arjay L. Balinbin, Corporate Editor

JAPAN’s Nomura Real Estate (NRE) Development Co. Ltd. said it expects the Philippines, a primary investment focus in Southeast Asia after Vietnam, to contribute up to 30% of its total overseas profit by 2031.

“With our current projections and assuming stable market conditions, we estimate that around 2031, the share of profit from FNG would be somewhere between 20-30% of the total profit of our overseas business we make, which is a substantial share,” Atsushi Ogata, executive officer of NRE’s overseas business division, said in an interview in Tokyo last week.

In 2022, NRE and Federal Land, Inc., the property arm of the Ty-led conglomerate GT Capital Holdings, Inc., established Federal Land NRE Global (FNG) to develop real estate in the Philippines permanently.

FNG, which hopes to create 6,000 job opportunities in the Philippines within the first five years of its operations, said it aims to integrate NRE’s innovation, technology, and design with Federal Land’s knowledge of the Philippine market.

Federal Land’s projects include GT Tower International in Makati, Marco Polo Plaza and Marco Polo Residences in Cebu. They also include the Metro Park, a 36-hectare integrated community in the Bay Area, and the Grand Central Park, a 10-hectare township in Bonifacio Global City (BGC), featuring the Grand Hyatt Manila and Grand Hyatt Manila Residences.

Federal Land’s first project with NRE is The Seasons Residences, a four-tower high-end residential development in BGC.

“FNG has four development sites in Metro Manila and Cebu Island, with a total project cost of approximately $5 billion,” said Masato Yamauchi, director and head of NRE’s overseas business division. The FNG project encompasses an initial lineup of residential, office, commercial, and industrial facilities.

The partnership has also brought the first Mitsukoshi, an international department store chain headquartered in Tokyo, to the Philippines.

NRE, currently the largest developer in Japan in terms of condominium unit turnover and the fifth largest in consolidated sales, regards its global business as a significant driver of growth.

The company, with a diverse portfolio including residences, offices, retail spaces, logistics facilities, and hotels,  plans to invest approximately JPY 550 billion in its overseas ventures by March 2031 and aims to generate more than 15% of its total profit from its international operations.

As of last year, NRE had an investment balance of JPY 140 billion in its overseas business — 19% for the Philippines, 5% for China, 10% for the United Kingdom, 1% for the United States, and 50% for Vietnam. This makes the Philippines the second largest recipient of NRE’s investments in Southeast Asia.

NRE is currently expanding its overseas portfolio into additional countries.

In Southeast Asia, Mr. Ogata said that Vietnam’s earlier market entry and larger population “naturally” led to higher investment there.

“We started the Vietnam business many years before the Philippines, so it’s natural to have a larger amount of investment. Also, the population of Vietnam is larger, making it a big market,” he said.

Mr. Ogata also noted the need to recognize the distinct differences between the Philippine and Vietnamese markets when comparing NRE’s ventures in both countries.

“Both are rapidly developing but with unique characteristics. For instance, in Vietnam, we don’t have any capital restrictions, so if we would like, we can invest hundreds of percent into a foreign project,” he said.

NRE’s projects in Vietnam include Zen Plaza, Sun Wah Tower, Phu My Hung Midtown, and Vinhomes Grand Park, all in Ho Chi Minh City, as well as the Ecopark Project in Hanoi.

The Philippines holds significant potential, Mr. Ogata noted. “The Philippine market, with its large population, is strategically important for us.”

The company employs the Japanese principle of “kaizen,” or continuous improvement, to refine its business practices and product offerings.

“Through kaizen, we’ve refined sophisticated methods in Japan that we can apply to the Philippine market,” Mr. Ogata said, highlighting the company’s tailored strategy to meet local needs at every project stage, from planning and design to construction and delivery, aiming to enhance overall value and quality.

PHL data centers need more engineers — Vertiv

THE Philippines is in need of engineers equipped to handle data center facilities amid growing demand, infrastructure and data center firm Vertiv said.

“We don’t have enough technical people to support all these builds. There are times that the client would be turning to us since they don’t have those engineers yet at their facility,” Vertiv Sales Director Pamela May Lagra Albar told BusinessWorld during its office launch on May 28.

Ms. Albar said its Vertiv Academy, located on the 18th floor of the newly opened Mandaluyong office, exposes interested professionals to the latest cooling, power, and environmental monitoring system.

“I have a case, we employed someone who is not familiar with the data center cooling, but they’re more familiar with the normal cooling system like in the mall,” she said.

According to Vertiv Chief Human Resource Officer Cheryl Lim, the company offers a six-month accelerated Vertiv engineering program that takes early grants and a 12-month customer engineering training program dedicated to services.

Currently, it is in talks with universities for partnerships where educational institutions are allowing access to its equipment.

The New York Stocks Exchange-listed company has 3,000 service engineers worldwide in more than 130 countries, Chief Financial Officer David Fallon said.

Meanwhile, its main office hosts 1,200 workers in various fields from engineers to customer service.

“To help fuel that talent recruitment need that we have, we’ve invested in our talent acquisition team here and moved the talent acquisition leader for the whole of Asia, but specifically for the Philippines, to here in Manila,” she said.

Ms. Lim added that the company tries to hire new graduates and move them around as far as we can before we hire them as engineers or somewhere else within the region. — Aubrey Rose A. Inosante

Live Nation probing Ticketmaster hack amid user data leak concerns

SAN FRANCISCO — Live Nation Entertainment said on Friday it was investigating a data breach at its Ticketmaster unit that it discovered on May 20, the latest in a string of high-profile corporate hacks in the past year.

In a filing with the US Securities and Exchange Commission (SEC), Live Nation said it found “unauthorized activity” in a third-party cloud database that mainly contained Ticketmaster data, and was working with forensic investigators.

The week before, a little-known cybercrime group named ShinyHunters said it had stolen user data of over 500 million Ticketmaster customers, according to various media reports.

Live Nation did not mention ShinyHunters in its SEC filing.

The company did not respond immediately to a Reuters request for comment.

The breach comes as the concert promoter has been battling regulatory scrutiny over antitrust concerns. Live Nation was hit last week with the first in a likely a wave of consumer antitrust lawsuits after the US government and states sued to break up the firm, arguing that along with its Ticketmaster unit, the company was illegally inflating concert ticket prices.

Live Nation in its filing said that on May 27, “a criminal threat actor offered what it alleged to be company user data for sale via the dark web.”

“We are working to mitigate risk to our users and the Company, and have notified and are cooperating with law enforcement,” the company said. “As appropriate, we are also notifying regulatory authorities and users with respect to unauthorized access to personal information.”

The breach hasn’t had and is unlikely to have a material impact on Live Nation’s business or financials, the company said.

“We continue to evaluate the risks and our remediation efforts are ongoing,” Live Nation said. — Reuters

Visa to roll out new features for cards in PHL, Asia-Pacific

VISA will be releasing new features and products for the cards that it supports in the Asia-Pacific, including the Philippines, to address the digital needs of businesses, merchants, consumers, and financial institutions, it said on Monday.

“Innovation in our industry is vital as payments serve as the fundamental vehicle of commerce enabling economies to thrive… There is a huge opportunity for the payments ecosystem to shape new digital experiences together. It is more critical than ever that we partner and collaborate closely to unlock meaningful value and impact for consumers, merchants and local communities,” Visa Asia Pacific Regional President Stephen Karpin said in a statement.

Visa will be introducing Visa Flexible Credential, which will allow a single card product to toggle between payment methods.

Users will be able to set parameters or choose whether they use debit, credit, “pay-in-four” with buy now, pay later, or pay using rewards points via the same Visa credential.

Visa noted that Sumitomo Mitsui Card Company (SMCC) was the first bank to adopt this solution in the Asia Pacific, known as “Olive” to SMCC’s cardholders.

“The solution is currently available in Hong Kong, Japan, the Philippines, Singapore, Thailand and Vietnam, and will be launched in more Asia-Pacific markets later this year,” Visa said.

The company will also be adding new ways to transact using mobile devices this year.

Customers will also be able to verify and authenticate their identity and authorize online payments through biometrics or passwords through Visa Payment Passkey Service. Built on the latest Fast Identity Online standards, Visa passkeys will replace the need for passwords and one-time codes for online shopping.

Visa will likewise eliminate the need to manually enter card information and undergo verification processes on e-commerce platforms through Click to pay.

“The solution enables consumers to complete online transactions within a few clicks by selecting which of their pre-enrolled Visa cards they’d like to pay with,” it said. 

Visa added that it will partner with issuers in the region to enable this solution.

The company will also be introducing data tokens, which will allow consumers to control the data they share through artificial intelligence (AI) and tokenization. Merchants will also be able to request consent from customers to give AI-based, real-time, personalized offers with data tokens.

“If the consumer agrees, behind-the-scenes, Visa issues a private data token to the merchant complete with AI-generated insights based on the consumer’s transaction data,” Visa said.

It will also pass the data token to the consumer’s bank, with users able to review where the data has been shared through their mobile banking app and revoke access if needed.

The company said it has issued more than one billion tokens in the Asia-Pacific region as of Monday.

“We are seeing a rapid transformation in the way consumers shop and manage their information in today’s hyper-digitalized era,” Visa Asia Pacific Products and Solutions Head TR Ramachandran said.

“The new solutions that are unveiled today will bring truly digital-native payment experiences right into consumers’ palms, setting the stage where commerce is made much more personalized, convenient and secure,” he added. — AMCS

Philippine industrial sector on growth trajectory — Colliers

ÜMIT YILDIRIM-UNSPLASH

By Joey Roi Bondoc and Brent Respicio

THE Philippine economy is starting to recover. With a 5.5% growth in 2023, the country was the fastest-growing in Southeast Asia. The Philippines is projected to achieve sustained growth for the remainder of the year and this is likely to make the country one of the fastest if not the fastest growing Southeast Asian economy.

But while the Philippines is receiving more investment pledges from Asian and European countries, particularly those funneled into manufacturing and renewable sectors, the country still lags behind its Southeast Asian peers.  In 2022, for instance, the Philippines attracted $9.4 billion in foreign direct investments (FDIs), much less than the FDIs attracted by Thailand ($11.2 billion), Malaysia ($14.7 billion), Indonesia ($24.7 billion), and Singapore ($140.8 billion).

The Philippines definitely has a lot of catching up to do. But if we want to attract more foreign investments that will eventually absorb industrial space and warehouses, we need to ensure that the Philippines is open for business, that is, the business registration process is streamlined; corruption is minimized or eliminated; and infrastructure network is comparable to what our ore progressive nations boast of.

The Philippines must ensure its competitiveness globally. In the latest IMD Global Competitiveness Report, the Philippines ranked 52nd while Thailand and Singapore placed 30th and 4th respectively out of 64 countries surveyed. The Philippines needs to improve in terms of infrastructure and government efficiency if it wants to improve its global ranking.

Colliers Philippines has highlighted a number of recommendations for developers and locators to capture the industrial segment’s low-hanging fruits.

EXPAND INDUSTRIAL FOOTPRINT IN CENTRAL LUZON
The Department of Trade and Industry (DTI) is currently pitching Central Luzon as a manufacturing and logistics hub, highlighting growth opportunities in Pampanga’s New Clark City, Bataan’s Freeport Area, and Tarlac’s Luisita Industrial Park. Singaporean firms are also keen on investing in the Filinvest Innovation Park in New Clark City. The first phase of the industrial hub is now accepting locators, particularly companies involved in logistics, e-commerce, light manufacturing, and data center operations. Colliers believes that the modernization of Clark International Airport is likely to raise the attractiveness of Central Luzon for more manufacturing and logistics investments. The development of public projects such as the Manila-Clark Railway, as well as cargo railway systems should also spur growth in the region.

Colliers Philippines believes that the region remains a viable alternative location outside of  Cavite-Laguna-Batangas (Calaba) corridor given its skilled manpower and relatively cheaper wages. Developers and locators should keep an eye on the completion of new industrial parks and facilities in the region.

OPPORTUNE TIME TO MODERNIZE WAREHOUSES
We recommend that developers or landlords increase power supply and provide ancillary spaces from existing facilities to accommodate new technologies such as robotics, improved lighting systems, and artificial intelligence (AI) systems. With the growing demand for same-day deliveries, e-commerce companies should be proactive in partnering with logistics firms with modern warehouses and efficient delivery systems.

DIVERSIFICATION IS KEY TO INDUSTRIAL EXPANSION
Property firms should consider developing industrial parks and facilities that will cater to a wide gamut of locators. Colliers believes that this direction is important if developers want to capture industrial locators from various industries including fast-moving consumer goods (FMCG), automobile parts, electronics, and logistics. These segments recently captured big-ticket investments from locators that took up industrial spaces in northern and southern Luzon.

The development of more economic zones is part of the Philippine Development Plan (PDP) 2023 to 2028 crafted by the Marcos Administration. In our view, this supports the government’s push for industrialization which in turn should benefit industrial parks and facilities across the country. Recently, the Philippine Economic Zone Authority (PEZA) approved the creation of 29 new economic zones in the country, most of which are industrial estates.

INTEGRATE TOWNSHIP COMPONENTS INTO INDUSTRIAL PARKS
We strongly recommend that industrial park developers incorporate industrial spaces and facilities within their township projects. For instance, Aboitiz InfraCapital’s LIMA Estate is composed of an industrial park, LIMA Technology Center, a residential subdivision (The Villages at Lipa) and a co-working facility, The Satellite. The township will also feature hotels, dormitories and commercial areas. Other industrial parks located inside integrated communities include Pueblo de Oro’s Light Industry and Science Park IV in The Townscapes Malvar in Batangas and Filinvest Land’s Filinvest Innovation Park in Ciudad de Calamba in Laguna. We’ve heard that some developers are also exploring the viability of establishing co-working facilities within their own industrial parks which will cater to outside employees.

WHAT’S IN STORE FOR THE PHILIPPINE INDUSTRIAL SECTOR
The Philippine industrial sector remains resilient. In fact, it achieved sustained growth even at the height of the pandemic in 2020 and 2021 as the country experienced a surge in the demand for modern warehouses and cold chain facilities. Colliers sees enormous upside for this property segment especially as we expect the investment pledges committed with President Marcos materializing over the next 12 to 24 months. This should result in an aggressive take up of industrial land and modern warehouses especially in the Philippines’ major industrial corridors — central Luzon and southern Luzon.  Developers want to corner a greater share of the industrial pie that’s why we expect property firms to ramp up their industrial footprint moving forward.

 

Joey Roi Bondoc is the research director while Brent Respicio is a research analyst at Colliers Philippines.

Thinning reserves and why we need nuclear energy

After many weeks of frequent yellow-red alerts this year, last Saturday, June 1, was really bad because a rotating blackout finally happened. On average it was 1.5 hours long in many Meralco franchise areas, but I was in western Pangasinan that day and the blackout lasted from 6:30 to 9:40 p.m., or three hours and 10 minutes. While electric lights can be substituted by candles or small movable solar lights, it was the absence of electric fans, and the inability to recharge mobile phones, laptops and other gadgets that worsened things.

I was searching to find out what big power plants were out, how many megawatts (MW) had been lost the past few weeks, which the narrative that “generation companies (are in) collusion to raise prices” is feeding and spreading. I checked the website of the Independent Electricity Market Operator of the Philippines (IEMOP) and I found the answers in their Weekly Market Watch. I looked at the last four weeks of 2024 and the comparative four weeks of 2023. Here is what I discovered.

1. The power supply this year keeps rising, it is not flatlining or falling. Over the last four weeks it has risen by 9% to 12% over the level a year ago. This is good, and the suggestion that the generation companies (gencos) are in collusion is therefore wrong and dishonest.

2. Power demand and Demand + Reserves are rising faster than they were a year ago, at 11% to 13%. This resulted in the further thinning of the supply margin this year, which contracted by 11% to 45%. Which explains the frequent yellow-red alerts.

3. The generator weighted average price (GWAP) is falling by an average of 2% to 16% compared with a year ago, this despite the decline in the supply margin. This means that the gencos are not really earning that much — their supply is stretched but their price is capped due to price control via secondary price cap at the Wholesale Electricity Spot Market (WESM). They cannot produce additional reserves due to price control (see the table).

In addition, the GWAP are nominal prices, not real or adjusted for inflation. So, if the 2024 prices are adjusted for inflation, the decline in prices would probably be by 3% to 20% compared to year ago levels.

THREE POLICY REFORMS
To help address the above problems, I see the need for three important changes in energy policies.

1. Increase the power supply big time, something like 12% yearly vs. the average increase of 5% to 6% in recent years. In gigawatt-hours (GWH) generation, this means an annual increase of 14,000 GWH/year.

This seems a stretch — twice the actual average increase of 5,000 to 6,000 GWH/year in recent years. And this is even higher than my previous estimate of a 7,000 to 9,000 GWH/year increase needed from 2025-2028 based on a GDP growth target of 6.5% to 8% yearly over the same period.

2. Adopt energy agnosticism and remove the priority or mandatory dispatch in the grid of intermittent renewables. Saving the economy from potential and actual blackouts should have precedence over “saving the planet.” Fossil fuel plants and nuclear plants can give us energy security at competitive prices, more so than intermittent renewables, especially wind and solar.

3. Lift or remove the price control at WESM for being anti-consumer and anti-jobs creation. The short-term gain of forced low prices is a lot less than the short- to long-term pain of potential/actual blackouts, and resultant discouraged investments and job creation in the country. The reserves market should also proceed without a price cap or the threat of any price control.

THE NUCLEAR OPTION
Hardly discussed in public discourse but the “elephant in the room” solution to thinning power reserves is the use of nuclear energy. Nuclear power offers a high energy density, like over 100,000 times that of coal or gas, and over 300,000 times that of solar or wind. That means it can produce lots of electricity in a very small land area, using very small volumes of uranium or other materials, and sell electricity at low or very competitive prices.

About safety: the last fatal nuclear accident was Chernobyl (in Ukraine) in 1986 with about 30 direct deaths and a few thousands suspected indirect deaths. The Fukushima disaster in 2011 has zero casualties and no sickness, but hundreds of thousands of people were evacuated as a precautionary measure.

Consider these recent reports in BusinessWorld: “It’s time to tap nuclear energy, lawmaker tells government” (April 17), “DoE signs two more deals with US to enable nuclear transition” (May 21), “Meralco about to complete feasibility study on micro-modular reactors” (May 29).

I like this perspective from Emmanuel V. Rubio, the outgoing President and CEO of Aboitiz Power, who correctly observed that “To ensure system reliability, the grid will require stable balancing capacities, most likely from gas-to-power technologies and eventually, nuclear.

“Nuclear does not have direct carbon dioxide emissions and it provides for stable baseload power, high energy density that can output large amounts of energy across several decades. A deliberate long-term nuclear energy program must be planned and enforced to assure safety, effective regulation, efficient operations, commercial feasibility, and optimum benefit. Government policies, workforce development, successful technology transfers, and access to financing for high upfront costs will determine the fate of nuclear power generation in the Philippines. It is a tall task for both the public and private sectors.”

At the UN meeting Conference of Parties (COP) 28 in Dubai last December, 25 countries signed a “Declaration to Triple Nuclear Energy Capacity by 2050.” Four of these countries were Japan, South Korea, Mongolia, and the United Arab Emirates. China, India, Taiwan, Pakistan and Bangladesh were not among the signatories, but these countries already have high or rising nuclear power generation.

The Philippines should hasten the adoption of nuclear energy in power generation plus other nuclear applications in agriculture, healthcare, and other sectors.

 

Bienvenido S. Oplas, Jr. is the president of Bienvenido S. Oplas, Jr. Research Consultancy Services, and Minimal Government Thinkers. He is an international fellow of the Tholos Foundation.

minimalgovernment@gmail.com

Filinvest allocates P1.1B for San Mateo residential project

PRESTIGE by Filinvest said it has allocated P1.1 billion for Celestia, a residential project in Timberland Heights in San Mateo, Rizal.

The project is scheduled for turnover in 2027.

“Under the top-end portfolio of Prestige by Filinvest, Celestia is designed to attract high-end investors and homebuyers,” First Vice-President under Prestige by Filinvest Bong Gonzales said in an e-mail on May 31.

Mr. Gonzales added that the company aims to break ground for the project by the end of this year.

Celestia will offer 273 expansive lots, located at the highest point within the township giving its residents a “panoramic scene of the Sierra Madre Mountain Range and the sparkling cityscape,” according to the company.

Celestia Phase 1 offers lots ranging from 351 to 708 square meters (sq.m.), with prices starting at 14 million, Mr. Gonzales said.

“We put people at the core of our work, so we design our towns with their comfort and convenience in mind,” he said.

“With how fast-paced city life could be, a home close to nature but still easily accessible from the city is a dream to many but made possible with Celestia.”

Celestia, Mr. Gonzales also said, offers a combination of tranquility and accessibility, where the bypass road ensures that residents are just 20 minutes from Quezon City.

“We are thrilled to launch Celestia at Timberland Heights because this is for people who worked their way to the top and deserve the best home and community where they can fully enjoy both nature and the city,” Filinvest Alabang, Inc. Senior Vice-President for Residential and Estates Daphne Mae Odra-Sanchez said.

Filinvest said Celestia offers expansive lot sizes ranging from 345 sq. m. to 1,148 sq. m.

“They can bask in the warm embrace of the sun at the perfectly designed Central Park or admire the beauty of both nature and architecture at The Peak, which features a vantage point of the entire neighborhood and its surroundings,” Filinvest said.

“Amenities are carefully curated befitting the exceptional lifestyle residents deserve. They can bask in the warm embrace of the sun at the perfectly designed Central Park or admire the beauty of both nature and architecture at The Peak, which features a vantage point of the entire neighborhood and its surroundings,” the company added. — Aubrey Rose A. Inosante

ABBA members reunite to receive top Swedish honor

ABBASITE.COM

STOCKHOLM — The four members of iconic Swedish pop group ABBA reunited on Friday to receive one of the country’s top honors, the Royal Vasa Order, during a ceremony in the royal palace in Stockholm.

Agnetha Faltskog, Bjorn Ulvaeus, Benny Andersson, and Anni-Frid Lyngstad, who rarely make public appearances together and are now in their 70s, were handed their orders from King Carl XVI Gustaf “for very distinguished contributions within Swedish and international music life,” according to the Royal Court.

The hugely popular group, which formed in 1972 and split in the early 1980s, has sold an estimated 385 million records and still has legions of fans around the world with enduring hits such as “Dancing Queen,” “Thank You For The Music,” and “Fernando.”

Sweden this year resumed the awarding of chivalry orders to Swedes after a 50-year pause.

It is also 50 years since ABBA won the Eurovision Song Contest final in Britain in 1974 with the song “Waterloo,” bringing them to global attention.

The musical Mamma Mia!, composed by Mr. Ulvaeus and Mr. Andersson and based on their songs, has since its first opening in 1999 been seen by over 70 million people around the world, according to its creators. It has also led to two blockbuster movies.

Mr. Ulvaeus told Swedish TV4 after the ceremony he felt “very emotional” receiving the order especially since it originated from the Swedish public.

Sweden has four orders of chivalry, established in the 18th century, of which the Vasa Order is the most junior. Members of the public propose recipients and the formal decisions are made by the government. — Reuters

BSP to revise rules for consolidated complaint reports

BW FILE PHOTO

THE BANGKO SENTRAL ng Pilipinas (BSP) is looking to issue guidelines for its supervised firms’ submission of consolidated complaint reports using a new data entry template, based on a draft circular.

The BSP said in the draft that the revised BSP-supervised institutions consolidated complaints report (BCCR) will be submitted on a quarterly basis.

This will be submitted “using Extensible Mark-up Language (XML) format through the Application Programming Interface (APl), beginning with the reporting period quarter ending March 31, 2024.”

Under the circular, the live submission shall begin on the reporting period for the first and second quarter of 2024.

“Reports will be due for submission within one month from the end of each reference quarter, with the first live submission comprised of two reports for the first two reporting periods,” it added.

Banks must discontinue submitting the BCCR using the old data entry template, the central bank said.

The submission of the BCCR will also be implemented in phases. The first phase will be for banks, the second phase for nonbank e-money issuers, and the third for other BSP-supervised institutions.

Penalties will also be imposed on erroneous, delayed or unsubmitted reports.

The circular also details where the respective templates and other necessary documents can be accessed.

The BSP said it is accepting comments on the draft guidelines until June 17. — L.M.J.C. Jocson

If Trump wins, his deficits are going to be yuge

MARKUS SPISKE-UNSPLASH

DONALD TRUMP’s lead over Joe Biden can largely be explained by voter unhappiness with the economy — specifically, concerns over high interest rates and inflation. Both are likely to get much worse if Trump becomes president.

House Speaker Mike Johnson confirmed last week that he is working on a budget reconciliation bill that would include — but not be limited to — a full extension of the 2017 Tax Cuts and Jobs Act, whose tax cuts are set to expire in 2025. The Joint Committee on Taxation reported last week that the cost of extending those cuts is now 50% higher, in nominal dollar terms, than it originally estimated. Meanwhile, over in the Senate, Republican Roger Wicker and Minority Leader Mitch McConnell are working on a plan to hike defense spending to 5% of GDP.

All told, this amounts to more than $10 trillion in additional borrowing for military spending and tax cuts alone. Brian Riedl, a fiscal policy analyst at the conservative Manhattan Institute who favors increased defense spending, calls this combination of priorities “completely detached from reality.”

And yet the reality is that these are the stated goals of the people who will control the agenda next year if Republicans win in November.

Granted, there has been a lot going on. But the tenor of the campaign continues to be oddly detached from this question of how the opposition party intends to govern. The general sense among some of those unhappy with Biden is that things haven’t gone as well as hoped over the past four years, so why not elect Trump to bring us back to the America of, say, late 2019.

But however you apportion the blame for what happened over the next few years — just to jog your memory, events included a major global pandemic, trillions in economic relief spending, the Russian invasion of Ukraine, and Iranian-backed militias disrupting Red Sea shipping, over and above anything that Biden did — Trump is not a magician, and he can’t turn back the clock. When Biden took over as president in 2021, he had to deal with the situation he was left by his predecessor. If Trump wins, he will have to do the same.

In 2017, he took over an economy that, despite years of steady growth under Barack Obama, remained somewhat depressed. Prime-age labor force participation was well below its peak, interest rates were near zero and had been for a long time, and inflation was quiescent. Trump took advantage of that opportunity to unleash an agenda of macroeconomic populism — tax cuts and increased military spending and increased domestic spending, with unpopular entitlement reform off the table. Inflation and interest rates did rise in response, but only a little and nobody minded much at the time, because the economy still had plenty of slack.

None of these conditions prevails today. Love Biden or hate him, the unemployment rate is very low, the employment-population ratio is fully recovered, and immigration has boosted the size of the labor force above pre-pandemic estimates. Adding more stimulus will be steeply inflationary unless offset by dramatic cuts elsewhere in federal spending.

Will that happen? It’s certainly possible. A Republican reconciliation bill would seek to repeal all or most of the clean-energy spending from the Inflation Reduction Act (IRA). At the same time, Republicans are also committed to repealing the IRA’s spending on tax enforcement and its provisions on prescription drug pricing, both of which will make the deficit higher. The law was deliberately constructed to slightly reduce both the deficit and inflation, so it’s hard to balance the books by repealing it.

Trump has sworn off cuts to Medicare and Social Security, the federal government’s two largest programs. So he’s left with Medicaid, which provides healthcare to the poor and long-term care for the elderly and disabled. Last time Trump was in office, his administration sought large cuts to Medicaid as part of Affordable Care Act repeal. This time around, Republicans are being remarkably cagey. In an interview with Semafor, Johnson said that plans for legislation were fluid but that there’s “a lot of innovation and change that is desperately needed” in healthcare.

It’s hard to disagree with a nonspecific call for “innovation and change.” It’s also hard to see it as an adequate answer for how Republicans are planning to govern the country.

To be fair, there are no feel-good answers to the question of how to address the budget deficit amid rising international tensions and an aging population. But a gigantic tax cut is not going to help, and pairing it with an aggressive effort to deport a large share of the workforce while cutting off an ongoing flow of workers is only going to exacerbate the basic problems with MAGA-nomics.

If Republicans have an actual plan to make this math work with offsetting cuts elsewhere, people deserve to know what it is. And if, as seems more likely, they plan to repeat the formula from Trump’s first term of just putting it all on the national credit card, voters deserve to know that, too, and ought to think about its implications.

Lax fiscal policy worked just fine for Trump during his previous stint in office. But circumstances have changed, and re-running that play — as he is currently promising to do — risks genuine fiscal catastrophe.

BLOOMBERG OPINION

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