Auto Sales (May 2024)
PHILIPPINE AUTOMOTIVE SALES rose by an annual 5.5% in May, amid “good consumer demand,” according to an industry group. Read the full story.
Pedro Roxas steps down from SPNEC board
LISTED SP New Energy Corp. (SPNEC) said Pedro Emilio O. Roxas has resigned as the company’s independent director.
Mr. Roxas vacated his post due to “personal reasons,” SPNEC said in a stock exchange disclosure on Tuesday.
The resignation was approved by the company’s board during a regular meeting on June 10. SPNEC did not provide further details on Mr. Roxas’ resignation.
Mr. Roxas is the chairman of listed companies Roxas Holdings, Inc. (RHI) and Roxas and Co., Inc. (RCI). He joined SPNEC’s board after Manuel V. Pangilinan took over SPNEC in December last year following the completion of a P15.9-billion investment.
Meanwhile, SPNEC’s board also approved the filing of listing applications with the Philippine Stock Exchange covering 40.07 billion common shares.
SPNEC was founded by businessman Leandro Antonio L. Leviste but is now controlled by the Pangilinan group through MGen Renewable Energy, Inc.
On May 16, RHI, First Pacific Natural Resources Holdings BV, First Agri Holdings Corp., and Leviste-led Countryside Investments Holdings Corp. signed a nonbinding term sheet covering a plan to invest P5 billion for an initial 71.6% stake in RHI.
Hong Kong-based First Pacific has three key Philippine units consisting of Metro Pacific Investments Corp., Philex Mining Corp., and PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Revin Mikhael D. Ochave
Vatican arrests ex-employee over sale of missing Bernini manuscript
VATICAN CITY — Vatican police arrested a former employee for allegedly trying to sell to the city-state a 17th-century manuscript by Italian Baroque master Gian Lorenzo Bernini that had previously disappeared from archives, a Vatican spokesman said.
Experts said the 18-page document, with gilded miniatures, contains the first details of the decorative features in the canopy of St. Peter’s Basilica designed by sculptor and architect Bernini.
Gian Lorenzo Bernini is considered the leading master of Italian Baroque architecture in the 17th century and among his masterpieces is the colonnade that surrounds St. Peter’s Square.
The suspect, who was arrested on May 27 on charges of attempted extortion, had worked for the Fabric of St. Peter, the institution responsible for the conservation and maintenance of St. Peter’s Basilica.
He remains in custody at the Vatican and has been questioned twice in recent days, the spokesman added. Vatican prosecutors will decide this week whether he will be formally indicted.
Prosecutors launched the investigation after a complaint from the Fabric and arrested the man when he brought the manuscript back to the Vatican offering it for €120,000 ($130,716).
The news was first reported by Italian daily Domani, which identified the suspect as a former Fabric head of communications and said he allegedly tried to sell the manuscript to Cardinal Mauro Gambetti, the archpriest of St. Peter’s Basilica.
Domani said the missing manuscript was back in the Vatican’s possession. — Reuters
AI startup Perplexity says news summary tool has ‘rough edges’
PERPLEXITY AI, a startup building a real-time artificial intelligence (AI)-powered search engine to complete with Alphabet, Inc.’s Google, has launched a new feature that repackages some news outlets’ work with minimal attribution — an issue the company’s founder said it’s working to address.
In a post on X on Friday, a Forbes reporter pointed out similarities between a Perplexity news summary and a Forbes article. “You scraped and repurposed investigative reporting gathered over months, fleshed it out with re-blogs of the same story by other outlets and do not even bother to name us in your regurgitated post,” wrote Forbes editor John Paczkowski.
In response, Perplexity Chief Executive Officer Aravind Srinivas said the issues were because the company’s “Perplexity Pages” feature, which offers summarized information about topics of the day in a magazine-like layout, is still new and has “rough edges.”
“The pages and discover features will improve,” he wrote, “and we agree with the feedback you’ve shared that it should be a lot easier to find the contributing sources and highlight them more prominently.” Mr. Srinivas also stressed that Perplexity’s main search product cites sources more noticeably.
Forbes reported on the issue on Friday, citing examples from its own reporting as well as CNBC and Bloomberg. In several cases, Perplexity used exclusive reporting, including from paywalled publisher sites, only referencing the outlets with a small, footnoted link that users have to click to see.
“The common feedback is that the sources are not very visibly clear, so more prominently highlighting them makes a lot of sense,” Mr. Srinivas told Bloomberg. “But people should also remember that it’s a new feature, released two weeks ago, and our core product is really prominent about sources. That shows our intention in general.”
The incident marks the latest example of increasing tension between media publishers and generative AI companies, which journalists accuse of improperly citing work without attribution or compensation.
Perplexity AI is a fast-growing startup in the competitive generative AI market. In April, the company raised $63 million in a new funding round that values it at over $1 billion, more than double its valuation three months earlier.
The company has distinguished itself from other AI chatbots by providing more real-time information. — Bloomberg News
PSEi member stocks performed — June 11, 2024
Here’s a quick glance at how PSEi stocks fared on Tuesday, June 11, 2024.
Peso rebounds vs dollar before Fed meet, US CPI
THE PESO rebounded against the dollar on Tuesday on expectations of slower May US consumer inflation and ahead of the US Federal Reserve’s policy decision.
The local unit closed at P58.68 per dollar on Tuesday, rising by 11 centavos from its P58.79 finish on Monday, Bankers Association of the Philippines data showed.
The peso opened Tuesday’s session stronger at P58.74 against the dollar. Its weakest showing was at P58.745, while its intraday best was at P58.66 versus the greenback.
Dollars exchanged rose to $1.05 billion on Tuesday from $604.85 million on Monday.
“The peso gained strength amid market hopes of a cooler-than-expected US consumer inflation report,” a trader said in an e-mail.
The peso also rose against the dollar ahead of the US Federal Reserve’s policy meeting, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
The biggest scheduled economic developments of the week are due on Wednesday, with the US consumer price index (CPI) and the Federal Reserve policy decision, Reuters reported.
The Fed is considered certain to hold steady at the conclusion of its two-day meeting on Wednesday, with the focus on whether it keeps three rate cuts in its “dot plot” projections for this year.
Futures imply 37 basis points (bps) of Fed easing for this year, compared with 50 bps before the jobs report was released last Friday.
Meanwhile the US CPI is forecast to rise a slim 0.1% in May, but with the core up 0.3%.
Philippine financial markets are closed on Wednesday, June 12, for the Independence Day holiday.
For Thursday, the trader said the peso could decline again due to potentially hawkish statements from the US central bank at the end of their two-day meeting.
The trader expects the peso to move between P58.55 and P58.80 on Thursday, while Mr. Ricafort sees it moving between P58.55 to P58.75 per dollar. — AMCS with Reuters
Stocks decline as IMF cuts PHL growth forecast
PHILIPPINE SHARES declined further on Tuesday after the International Monetary Fund (IMF) slashed its economic growth forecast for the country.
The Philippine Stock Exchange index (PSEi) dropped by 0.75% or 48.57 points to finish at 6,410.07 on Tuesday, while the broader all shares index fell by 0.49% or 17.19 points to close at 3,450.05.
“The local market dropped as investors digested the IMF’s downward revision of its projection for the Philippines’ economic growth for this year after the slower-than-expected first-quarter gross domestic product (GDP) data,” Philstocks Financial, Inc. Research and Engagement Officer Mikhail Philippe Q. Plopenio said in a Viber message.
The IMF now sees Philippine GDP expanding by 6% this year, lower than its 6.2% forecast in its World Economic Outlook in April, it said on Monday. This is within the government’s 6-7% target.
The Philippine economy grew by 5.7% in the first quarter from 6.4% a year ago and 5.5% in the fourth quarter.
“Investors also took a cautious stance ahead of the local holiday,” Mr. Plopenio added.
Philippine financial markets are closed on June 12 (Wednesday) for Independence Day.
“The local bourse logged its third consecutive day of decline as investors locked in their gains ahead of the conclusion of the US Federal Reserve policy meeting and the latest US CPI (consumer price index) reading. The meeting will conclude on Wednesday with an interest rate policy decision and a subsequent press conference featuring Federal Reserve Chair Jerome H. Powell,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.
The Federal Open Market Committee was set to start its two-day policy meeting overnight, where it is expected to keep its target rate at the 5.25%-5.5% range for a seventh straight meeting.
The Fed will also update their economic and interest rate projections at this week’s review.
Officials have turned more hawkish since the last such release in March, when the median projection was for a reduction of three quarter-points this year, Reuters reported. Markets are currently pricing in only 37 basis points of cuts by December.
Back home, all sectoral indices ended lower. Services lost 1.79% or 35.60 points to close at 1,953.25; mining and oil went down by 1.43% or 129.70 points to 8,880.71; property dropped by 1.01% or 24.94 points to 2,423.22; holding firms declined by 0.33% or 18.78 points to 5,636.48; financials retreated by 0.29% or 5.82 points to 1,968.19; and industrials decreased by 0.28% or 26.14 points to 9,049.07.
Value turnover climbed to P3.3 billion on Tuesday with 400.9 million issues switching hands from the P3 billion with 282.36 million shares traded on Monday.
Decliners outnumbered advancers, 99 against 82, while 43 names ended unchanged.
Net foreign selling rose to P742.96 million on Tuesday from P161.4 million on Monday. — R.M.D. Ochave with Reuters
TIEZA assets to be presented to investors at summit this month
By Justine Irish D. Tabile, Reporter
THE Tourism Infrastructure and Enterprise Zone Authority (TIEZA) will offer its portfolio of assets and proposed projects to investors at an upcoming industry summit, the event’s organizers said.
The Philippine Tourism and Hotel Investment Summit on June 21 is expected to showcase investment opportunities in tourism, hotels and hospitality, according to the Philippine Hotel Owners Association, Inc. (PHOA).
PHOA Executive Director Benito C. Benzon, Jr., speaking at the summit’s media launch on Tuesday, said: “With the presence of hotel owners, investors, and developers, we are hoping to bring forward (potential investments) because the decision-makers will all be there.”
“We also want the investors to take a hard look at what is available in the portfolio of TIEZA because TIEZA has a wide range of assets and investment offers that the developers and owners can consider,” he added.
The event is expected to attract around 250 delegates. It will be the first of its kind in the Philippines.
“This summit … provides an excellent opportunity not only to network but to share insights and strategies towards sustainable development and growth,” PHOA President Arthur M. Lopez said.
It will also feature exhibitions by 30 companies showcasing hotel equipment, energy efficiency solutions, spa and wellness offerings, and digital solutions for the industry.
“The exhibition will not only offer a glimpse into the latest trends and innovations but also foster partnerships essential for the sector’s evolution,” TIEZA Chief Operating Officer Mark T. Lapid said.
“We hope that this event will help us promote tourism investments and increase our capacity to accommodate inbound tourists,” he added.
PHOA represents 217 member hotels with a total inventory of more than 40,000 rooms.
Capas, Tarlac to host $2.71-B data center hub
NARRA Technology Park Development, Inc. said it is investing around $2.71 billion in a 300-megawatt (MW) hyperscale data center hub in Capas, Tarlac.
On Tuesday, Narra signed a lease agreement with Tarlac province for a 47-hectare site, upon which the company plans to build a hyperscale data center to be completed in three phases of 100 MW each.
William M. Johnson, Narra managing director, said that the company is expecting to spend around $890 million for each phase of the data center, while an additional $35 million will be used on road development.
Citing a study by Cushman and Wakefield, Mr. Johnson said that three 100-MW data centers may could potentially cost under $3 billion.
“So it’s a very, very significant investment, install all the racks and the servers, and bring it to full operation,” he added.
He said the $2.71 billion does not include the additional costs involved en route to achieving the target of being 100% powered by renewable energy within the first five years.
Asked why the company chose the Philippines, he said: “The Philippines is an ideal location for the data center industry due to its large industrial land parcels, growing availability of clean renewable energy sources, and supportive digital infrastructure strategy from the Philippine government.”
He added that the Philippines has an estimated operational capacity of only 67 MW for data centers and favorable conditions for data center development, making it attractive for investment.
The data center hub is expected to rise at Clark Science City in Capas, Tarlac.
Mr. Johnson said New Clark City is an ideal location because the availability of land is a challenge in Metro Manila. He added that the New Clark City masterplan accommodates the development of a modern hyperscale data center hub.
“Additionally, New Clark City’s proximity to Metro Manila ensures excellent connectivity to the capital region,” he added.
The project, including the construction phase, is expected to generate over 1,500 direct jobs. Upon completion, the site will host 200 highly skilled workers in information technology operations, maintenance, cybersecurity, and other areas.
The first phase of the project is expected to be fully commercially operational by the fourth quarter of 2026, though the 2026 target could slip depending on demand.
“The subsequent phases in our original business plan (were planned to be) less than a year after each other, but that’s wholly dependent upon demand and uptake,” Mr. Johnson said.
“But we know that phase one is going to be taken up very quickly and built out. And we also believe that with phase one coming online, we’ll see that this is actually a very viable business model, and we expect the other two phases to go fairly quickly,” he added.
The lease entered into by the Tarlac government and Narra has a 50-year term that can be extended for a total of 25 years, subject to negotiation, Bases Conversion and Development Authority (BCDA) Chairman Delfin N. Lorenzana said.
Under the agreement, the Tarlac government and BCDA will have a 60–40 revenue split, respectively, from the Narra lease.
Asked to elaborate on the lease terms, Mr. Lorenzana said the company will pay the “prevailing price” to operate at the site. — Justine Irish D. Tabile
Peso weakness ‘not that bad,’ but needs to be stable — NEDA
PERSISTENT VOLATILITY in the peso exchange rate is a bigger concern than the currency’s current spell of weakness, National Economic and Development Authority (NEDA) Secretary Arsenio M. Balisacan said on Monday.
“The issue is really more on the stability of the peso,” Mr. Balisacan told reporters on Monday. “If the peso weakens a bit, it’s not that bad,” adding that volatility is disruptive to business overall, though it may benefit some industries.
“(A weaker peso) would make our exports more competitive… like bananas, fruits, vegetables… they become now more attractive, and farmers could earn more from those commodities,” Mr. Balisacan said.
A weaker peso can also increase the value of remittances and benefit tourism, Mr. Balisacan said.
“Foreigners would be enticed to visit because they can get more for their currency,” he said.
On Tuesday, the peso closed at P58.68 to the dollar, stronger than its P58.79 finish on Monday, according to the Bankers Association of the Philippines.
“Manufacturing, whether they are import substituting or producing for exports, benefits from the weaker peso,” he said.
May factory activity as expressed in the Purchasing Managers Index (PMI) was 51.9 from 52.2 in April, S&P Global said.
A PMI reading above 50 signifies that manufacturers are purchasing more raw material for factories to process a few months hence, thereby serving as a leading indicator for improved factory activity. A reading below 50 indicates a slowdown in raw material purchases, signaling that manufacturers are planning for reduced production.
Mr. Balisacan said monetary policy can help stabilize the peso and contain the inflationary impact of a weak currency.
“There are ways of tempering the effects of those to inflation, that’s what monetary policy makers do,” he said. “Having said that, I don’t want to see a sharp depreciation because that disrupts planning and business decisions.”
Headline inflation accelerated to a six-month high 3.9% in May, the Philippine Statistics Authority said.
Filomeno S. Sta. Ana III, coordinator at the Action for Economic Reforms, said the weaker peso has yet to manifest in hotter inflation.
“What should continue to worry us more is the main driver of inflation in the Philippines — food. So the major interventions still relate to food and trade policy in increasing the food supply,” he said in a Viber message.
“The BSP (Bangko Sentral ng Pilipinas) can use foreign exchange intervention to smoothen exchange rate fluctuations,” Mr. Sta. Ana said. — Beatriz Marie D. Cruz
Bosch plans training center for manufacturing workers
THE Department of Trade and Industry (DTI) said Germany’s Robert Bosch GmbH will establish an “experiential learning laboratory” in the Philippines to help upskill and reskill workers, preparing them for advanced manufacturing jobs.
In a statement on Tuesday, the DTI said that it signed a memorandum of understanding with Bosch on June 7, which will build a facility that will train manufacturing workers on the Internet of Things, artificial intelligence, and digital manufacturing.
“Our partnership with Bosch represents our pivotal collaborations with both local and international partners and technology providers to build a robust Industry 4.0 ecosystem,” Trade Secretary Alfredo E. Pascual said.
“This factory will serve as an experiential learning laboratory, equipped with automation technologies powered by Bosch and other technology partners,” Mr. Pascual said.
The signing took place at the Bosch Rexroth Regional Training Center in Singapore.
“We are proud to collaborate with the DTI and together enhance the competitiveness of the manufacturing sector in the Philippines,” Bosch Regional President for Southeast Asia Vijay Ratnaparkhe said.
“Through this partnership, we will help strengthen the Philippines’ industrial capabilities and readiness for advanced technologies, while promoting sustainable economic growth and resilience in a rapidly evolving industry,” he added.
In a separate statement, the DTI said Mr. Pascual met with Singaporean business leaders on June 5 to pitch the Philippines as an “ideal gateway for accessing the ASEAN market.”
Mr. Pascual touted the Philippines’ manufacturing potential in the semiconductor, automotive, textile and garment, medical device, aerospace, iron and steel, and pharmaceutical industries.
The meeting was attended by members of the Singapore Manufacturing Federation (SMF), the Singapore Business Circle, the Singapore Food Manufacturers’ Association, and others.
SMF has a company membership of about 5,000. — Justine Irish D. Tabile
FTI-managed food hub planned for BFCT Marikina
THE Department of Agriculture (DA) is looking to put up a food hub in Marikina City within the BFCT Bagsakan Center, which will be managed by Food Terminal, Inc. (FTI).
In a statement, the DA said that negotiations are underway for either a joint venture or long-term lease on a one-hectare property at the Bagsakan Center site.
“We lack food terminals — places where buyers and sellers can transact at a wholesale level. This food hub will be part of the DA’s logistics roadmap,” Agriculture Secretary Francisco P. Tiu Laurel, Jr. said.
The DA said the Marikina food hub will feature cold storage and dry warehouses.
“While the management of these food hubs will fall under the purview of Food Terminal, Inc., a KADIWA component will be integrated into their operations,” Mr. Laurel said.
The Kadiwa program enables farmers and small businesses to sell their produce direct to consumers through designated Kadiwa sites, pop-up stores, mobile stores, or online.
“These hubs will serve as vital platforms where farmers and cooperatives can directly bring their produce, facilitating transactions with wholesale buyers and individual consumers alike, all while offering agricultural products at competitive prices,” he added.
The DA said a network of food hubs will enhance the efficiency of agricultural supply chains, ensuring sufficient supply of affordable produce, especially in areas where demand is high. — Adrian H. Halili