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CEOs worry over business viability

More than half of Philippines-based chief executive officers are worried over the viability of their businesses in the next decade, a survey showed. — PHILIPPINE STAR/ MIGUEL DE GUZMAN

By Justine Irish D. Tabile, Reporter

OVER HALF of Philippine-based chief executive officers (CEOs) are concerned over the viability of their businesses in the next 10 years without reinvention, according to a report by PwC Philippines. 

The Philippine report of PwC’s 27th Global CEO Survey showed that 54% of CEOs believe that their companies “will not be economically viable in the next decade if they continue on their current path.” This is lower than the Asia-Pacific average of 63%.

Asked about the long-term viability of their businesses, 46% of Philippine-based CEOs expressed concern, much higher than the 34% average in the Asia-Pacific region.

Conducted from October to November 2023, the survey covered 1,774 CEOs in the Asia-Pacific region, including 35 CEOs in the Philippines.

More than half or 57% of Philippine-based CEOs are optimistic that the global economy will improve over the next 12 months, higher than the Asia-Pacific average of 40%.

Around 77% of Philippine-based CEOs said the United States is the most important for their growth prospects, while 40% cited China.

“The Philippines has undertaken efforts to improve its investment climate and attract foreign direct investment. This sustained growth and the positive investment climate could have promoted optimism among CEOs regarding both local and global economies,” PwC Philippines Deals and Corporate Finance Managing Partner Mary Jade Roxas-Divinagracia said in a statement.

For the next 12 months, 40% of Philippine-based CEOs identified geopolitical conflict as a key threat, while 37% cited inflation. At least 29% of the CEOs said macroeconomic volatility and cyber risks are also main threats.

PwC Philippines Chairman and Senior Partner Roderick M. Danao said that there is growing impetus to reinvent among Philippine business leaders.

“Many of our country’s business leaders are now working on accelerating the transformation of their business models, investing in technology and their workforce, and managing the risks and opportunities related to climate change,” Mr. Danao said in a statement.

“In this era of continuous reinvention, CEOs have vast opportunities to reshape their organizations and themselves, to thrive on disruption, and to transform aspirations into realities,” he added.

According to the report, 97% of the Philippine respondents said that they have already taken steps to change “how they create, deliver, and capture value over the past five years.”

Meanwhile, 86% said that they at least took one action that largely impacted their company’s business models.

However, 71% of the Philippine CEOs cite the lack of workforce skills as a barrier to reinventing the business models of their companies.

The other top challenges cited by business leaders are the lack of technological capabilities (69%) and competing operational priorities (65%).

Michael L. Ricafort, chief economist of the Rizal Commercial Banking Corp., said that businesses will need to digitize and adopt the best technologies globally to drive growth.

“These will help grow their business by leaps and bounds, further boost productivity and output, and reduce costs,” Mr. Ricafort said in a Viber message.

Aside from making their businesses viable, he said digitization and the adoption of the latest technologies will also help improve businesses’ competitiveness.

Sought for comment, Union Bank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said organizations that want to remain viable need to reinvent themselves by improving and adjusting to the current environment.

“Being relevant can ensure its existence and hopefully profitability and resilience,” he added.

AI IMPACT
According to PwC, CEOs are seeing generative artificial intelligence (GenAI) as a catalyst for reinvention “that will power efficiency, innovation, and transformational change.”

At least 60% of the CEOs in the Philippines are expecting GenAI to impact the workforce in the next three years, while 57% believe GenAI will positively impact revenue and profitability.

Mr. Danao said that they have been seeing “heightened interest” from business leaders in GenAI.

“Their enthusiasm over the opportunities for growth and innovation that GenAI brings demonstrates their understanding of the need for fundamental reinvention of their businesses,” he added.

However, 80% of the CEOs said that to be able to reap the “transformative benefits” of GenAI, there is a need to upskill the workforce.

Meanwhile, 69% of them are concerned about cybersecurity risks, while 57% are concerned about misinformation.

NCR wage increase likely in July, says Labor chief

Laborers are seen working on a construction site in Navotas City, June 22, 2024. — PHILIPPINE STAR/RYAN BALDEMOR

By Chloe Mari A. Hufana

A WAGE INCREASE in the Philippine capital and nearby cities is likely in July, based on past decisions by the regional wage board, according to the country’s Labor chief.

“There is always an adjustment based on historical data,” Labor Secretary Bienvenido E. Laguesma told reporters on the sidelines of an event on Wednesday. “The challenge is how much.”

He declined to give an estimate.

The wage board in the National Capital Region (NCR) is expected to release its decision on the petitions to raise the daily minimum wage on or before July 16, the anniversary of the previous wage order.

To recall, the NCR wage board last July approved a P40 increase, which brought the daily minimum wage to P610 for nonagriculture sector workers and P573 for agricultural workers.

The Employers Confederation of the Philippines (ECoP) on Wednesday sought minimum wage-setting mechanisms that consider productivity, the market value of jobs, and the financial capacity of businesses, especially micro, small, and medium enterprises.

This would “ensure sustainable job creation and business growth,” the group said in a resolution signed at the National Employment Summit.

Wage hike decisions should also consider the impact on the majority of the population that will not benefit from such adjustments, ECoP said.

ECoP Governor and Philippine Chamber of Commerce and Industry Director Arturo “Butch” C. Guerrero III said the wage-setting mechanism they are pushing for is through a tripartite system, not a legislated one.

The Senate last February approved on third and final reading a bill increasing the daily minimum wage in the private sector by P100.

At the House of Representatives, separate bills that seek to increase wages of private sector workers by P150 to P750 have been filed.

“A wage increase of P150 across the board nationwide will lift many workers out of poverty wages. This moderate increase represents about 24% of the NCR minimum wage of P610 per day,” Federation of Free Workers President Jose Sonny G. Matula said.

Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms, said a wage hike will “maintain the level of real wages.”

“[The] recent quarter showed a slowdown in consumption, which could suggest that people’s reluctance to spend because of higher prices,” he told BusinessWorld in a Viber message.

“So, an increase in minimum wage will not necessarily translate into a wage-price spiral so long as the minimum wage is tempered and is intended to adjust for inflation,” he added. “The wage hike intends to recover [the] previous level of disposable income, which, however, was eroded by high inflation.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort told BusinessWorld in a Viber message that a wage hike is needed, especially by the poorest of the poor, to cope with rising prices.

“Inevitably, [wage hike will contribute to inflation], through second-round inflation effects as seen in 2022 and 2023,” he added.

However, ECoP said a P15 increase in minimum wages for NCR workers is at par with the consumer price index’s rise.

“[Wage increase is] a delicate balancing act and I would like to look at the situation where the members of the board will be able to consider and look at the arguments, positions, and the stand offered during the public hearing,” Mr. Laguesma told reporters on Wednesday.

Meanwhile, ECoP urged the Marcos administration to develop national resilience programs, social protection mechanisms, and transition strategies to support both workers and employers as artificial intelligence (AI), machine learning, and other disruptive technologies reshape the workplace.

ECoP said schools should prioritize developing “life skills, technological skills and soft skills” in students to prepare them for employment.

“These technological disruptions together with issues on climate change, demographic shifts, and geopolitics will create both opportunities and challenges that will impact social dialogue and collaboration among bipartite and tripartite partners in addressing issues in a technology-driven environment,” according to the resolution signed by ECoP Chairman Edgardo G. Lacson and President Sergio R. Ortiz-Luis, Jr.

ECoP’s Mr. Guerrero told reporters that national resilience programs are needed to address the impact of the pandemic on businesses.

“Many people are taking jobs just to have a job. But their skills are not adept for the job they’re doing. They’re overqualified. So, it’s a matter of matching the jobs. That’s why we have a jobs program to make it appropriate,” he said.

The Technical Education and Skills Development Authority (TESDA) offers upskilling programs, he added, but they are outdated. Instead, an industry-led upskilling program should be undertaken.

“The government manual is not updated. It no longer fits. So, it should be industry-led. It should come from the employers. The TESDA manuals should be in collaboration with their old manuals and that’s what we will roll out,” he said. “Because if you roll out an outdated manual, you just wasted your time trying to upskill these people.”

Philippines’ current account deficit seen to further narrow this year

ICTSI

THE PHILIPPINES’ current account deficit is seen narrowing further this year amid a more positive global outlook, Fitch Solutions’ unit BMI said.

In a report dated June 25, BMI lowered its current account deficit forecast to 2.3% of gross domestic product (GDP) from 2.8% previously.

This is narrower than last year’s current account deficit which stood at 2.6% of GDP, but wider than the average of -0.4% from 2015-2019.

The BSP projects a $4.7-billion current account deficit for 2024, equivalent to 1% of GDP.

“A more optimistic global outlook was the main reason behind this revision. We initially anticipated a more significant downturn in worldwide demand,” BMI said.

“However, the global economy has proven to be much more resilient, prompting us to pencil in a stronger (global) expansion of 2.4% in 2024 after initially projecting global GDP growth of 2.1% at the start of the year,” it added.

The latest data from the BSP showed that the current account deficit stood at $1.7 billion in the first quarter, equivalent to -1.6% of GDP. This was lower than the $4.4-billion gap or -4.3% of GDP seen in the same period a year ago.

“Risks to our current account outlook lean towards a larger shortfall. Much hinges on trends in the global economy,” it said.

BMI said that it sees external demand weakening in the second half of the year, due to an expected economic slowdown in China, the United States, Japan, Hong Kong and Singapore.

“While external demand has held up relatively well in the first half of the year, we think that it will slow in earnest in the latter half as major trading partners face domestic economic headwinds of their own,” it said.

BMI said the tourism sector’s recovery may “not be as strong as the numbers suggest” and may be the “result of an anomaly.”

“International visitors are still 40% lower than prior to the pandemic even though revenues have already exceeded pre-pandemic levels. We have determined that this increase is due to a temporary change in spending patterns, driven by a backlog of travel demand after the pandemic,” it said.

The uptick in tourism revenues is expected to taper off soon, with some signs of a slowdown already emerging.

“Average expenditure to date this year is roughly 5% less than in 2023, once inflation adjustments are made,” BMI said.

Foreign investments are also seen to remain muted this year, a trend seen in other countries in the region.

“While we are of the belief that extensive reforms implemented in recent years will indeed pay dividends, the prevailing environment of high interest rates will keep a lid on investment activity for now,” BMI said.

BMI data showed FDI as a share of GDP averaged 1.9% in the last four quarters, lower than the previous decade’s average of 2.2%.

The Bangko Sentral ng Pilipinas (BSP) has kept the key rate at a 17-year high of 6.5% since October 2023.

In a separate report, BMI said that it expects the central bank to keep rates steady at its meeting on Thursday.

This is in line with a BusinessWorld poll conducted last week where all 15 analysts surveyed expect the Monetary Board to stand pat for a sixth straight meeting.

“Given that the economy has remained fairly resilient thus far, the Bank will be in no hurry to cut rates until price pressures have eased more convincingly,” BMI said.

BMI said it is keeping its positive outlook for consumer spending in the Philippines despite elevated interest rates.

“Easing inflation and a tight labor market will support spending, as real wage growth returns to positive territory, which will support purchasing power over the year,” it added.

The BSP expects inflation to temporarily accelerate to above the 2-4% target until July but settle within target after. — Luisa Maria Jacinta C. Jocson

Peso to remain weak as BSP appears less likely to defend

BW FILE PHOTO

THE PESO may remain weak against the dollar as the Bangko Sentral ng Pilipinas (BSP) is not expected to “strongly” defend the currency amid its recent dovish policy signals, Bank of America (BofA) Global Research said.

“(The Philippine peso) remains on the weaker side, taking cues from the BSP’s dovish turn in the last policy meeting and lack of concern on the FX (foreign exchange) moves,” it said in a report.

BofA Global Research said the “bearish positioning could slow further weakness” but the BSP appears less likely to defend the peso from falling to P59 against the US dollar.

“Geopolitical concerns need to be watched as another trigger for further weakness,” it added.

The peso closed at P58.86 against the dollar on Wednesday, weakening by nine centavos from its P58.77 finish on Tuesday. This was its weakest finish in over 20 months or since its P58.87-per-dollar close on Oct. 24, 2022.

The BSP earlier said that the peso’s recent performance is “temporary” given the expected delay in the US Federal Reserve’s policy easing.

BSP Governor Eli M. Remolona, Jr. had also said that it is a case of a “strong dollar” and not a weak peso due to the tensions in the Middle East.

To keep markets orderly and control speculation, the BSP said that it has intervened in the foreign exchange market in “modest” amounts.

“(Philippine peso’s) weakness may reflect concerns on a weak growth outlook which has also led to a dovish turn in BSP’s policy guidance,” BofA said.

“The governor’s comments about the possibility of a cut in the August meeting may have changed market expectations on the policy priorities between supporting the domestic economy vs. preserving FX stability,” it added.

Mr. Remolona earlier signaled the possibility of starting the easing cycle by August, for a total of 25-50 bps worth of cuts for the entire year.

“Lower rates in the Philippines have raised the chances of even narrower interest-rate buffer against (US dollar) rates, which may impact the hedging behavior of corporates,” BofA said, adding pressure could go up if the US dollar strength picks up or US yields rise again.

Meanwhile, BofA said that elevated inflation remains the top risk facing the Philippines.

“Food price shock and higher commodity prices in general remain the key risk for the Philippines, leading to a widening of the twin deficits,” it said.

Inflation could possibly breach the 2-4% target band until July, according to the central bank. The BSP expects inflation to average 3.5% for the full-year 2024.

“Geopolitical risks due to border clashes with China could impact investment flows,” BofA added. — Luisa Maria Jacinta C. Jocson

NexGen caps IPO price at P1.68 per share

FREEPIK

RENEWABLE ENERGY company NexGen Energy Corp. has priced its initial public offering (IPO) at P1.68 per share, matching its upper-end forecast.

The company announced the IPO price on June 25, as per a notice on the Philippine Stock Exchange (PSE) website.

It expects its shares to be officially listed on July 16.

NexGen Energy’s IPO comprises a primary offer of 300 million common shares and an overallotment option of up to 45 million secondary common shares. 

The offer period is set from July 1 to 8, based on its latest prospectus dated June 24.

If the schedule holds, NexGen Energy is expected to become the third company to go public this year. It will join OceanaGold (Philippines), Inc., which listed on May 13, and Citicore Renewable Energy Corp., led by Saavedra, which listed on June 7.

On Monday, the PSE approved NexGen Energy’s application for the initial listing of up to 1.49 billion common shares, inclusive of shares designated for its IPO, under the small, medium, and emerging board.

The company anticipates generating approximately P478.4 million in net proceeds, which will fund its renewable energy projects in Zambales, Cavite, and other regions.

NexGen Energy appointed Chinabank Capital Corp. as the sole issue manager and sole bookrunner, while Investment & Capital Corp. of the Philippines serves as joint lead underwriter for the offer.

Sought for comment, Globalinks Securities and Stocks, Inc. Trader Mark V. Santarina said in a Viber message: “This IPO is relatively small compared to previous ones, making it challenging to predict if it will trade below the IPO price.”

“Traditional energy sources are notoriously expensive, and NexGen Energy offers a promising solution for the Philippines’ transition to clean energy,” he added.

Mr. Santarina said the current market conditions are “a concern” for IPOs.

“With low trading volume and the overall market trend, it doesn’t seem like an ideal time for an IPO, especially since other candidates have deferred their listings,” he said.

NexGen Energy is a subsidiary of Power Energy, which is a holding company that has assets in hydropower, solar, wind, geothermal, as well as bulk water and distribution facilities.

Established in 2017, the company is eyeing to develop 1,683 megawatts (MW) of ground-mounted and floating solar plants, and onshore and offshore wind projects in the next five years.

It currently manages three solar plants through its subsidiary SPARC — Solar Powered Agri-Rural Communities Corp., with an aggregate capacity of 13.859 MW peak. — Revin Mikhael D. Ochave

MPTC proposes P40-billion expressway for Naic, Cavite

PHILIPPINE STAR/ MICHAEL VARCAS

PANGILINAN-LED Metro Pacific Tollways Corp. (MPTC) said it hopes to construct a P40-billion expressway in Naic, Cavite.

“We are in discussions with the provincial government of Cavite about a possible Naic connection to CALAX (Cavite-Laguna Expressway) in General Trias,” MPTC unit MPT South President and General Manager Raul L. Ignacio told reporters recently.

The proposal would be a public-private partnership (PPP) and would depend on the completion of the Bataan-Cavite bridge, Mr. Ignacio said.

“The route of the proposal will pass through Naic, Cavite, connecting General Trias through CALAX,” he added.

CALAX is a four-lane, 45-kilometer toll road connecting the westbound Manila-Cavite Toll Expressway (CAVITEX) and the eastbound Mamplasan rotunda to the South Luzon Expressway.

To date, only the 14.24-kilometer segment of the toll road is operational, data from its website showed.

“We were informed that (the Bataan-Cavite bridge) will push through, so (our proposal) should be executed,” Mr. Ignacio said.

He said the project cost will also depend on the number of interchanges to be constructed.

The Bataan-Cavite Interlink Bridge is a 32.15-kilometer marine bridge connecting Central Luzon to CALABARZON, or Cavite, Laguna, Batangas, Rizal, and Quezon. The Asian Development Bank is co-financing the project.

The bridge is expected to reduce travel time from Mariveles, Bataan, to Naic, Cavite, from five hours to 1.5 hours. It is expected to be completed by 2029.

For now, MPTC is in talks with the Cavite local government as mandated by the new PPP Law, Mr. Ignacio said.

In 2023, President Ferdinand R. Marcos, Jr. signed a measure aimed at streamlining the framework for PPPs.

The PPP Code, or Republic Act No. 11966, amended the Build-Operate-Transfer Law to create a unified legal framework for all PPPs at both national and local levels.

“We have submitted our intention to Cavite; we have to consult with them first on the rerouting and how to proceed,” Mr. Ignacio said.

MPTC is the tollways unit of Metro Pacific Investments Corp., one of three key Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT Inc. — Ashley Erika O. Jose

Metro Pacific Water, French firm to build desalination plant in Iloilo

METROPAC Water Investments Corp. (Metro Pacific Water) on Wednesday said it is working with France-based water and waste management solutions provider Suez for the construction of a desalination plant in Iloilo City.

The companies recently signed an agreement to build a desalination plant that can produce 66.5 million liters per day of water, Metro Pacific Water said in a statement.

“This partnership with Suez marks a significant step forward in our commitment to providing a sustainable and reliable water supply for the people of Metro Iloilo,” Metro Pacific Water President and Chief Executive Officer Christopher Andrew B. Pangilinan said.

“The new desalination plant will ensure we can meet the rapidly growing demand of this dynamic metropolitan area for years to come,” he added.

According to the company, Metro Iloilo is experiencing “a period of rapid economic and population growth,” which is placing “strain” on existing water resources.

A new desalination plant would be a critical project “to ensure a reliable and sustainable water supply for the region in the immediate and medium term,” Metro Pacific Water said.

“We are proud to partner with Metro Pacific Water on this important project. Our expertise in desalination technology will contribute to a secure and sustainable water source for Iloilo,” said Farchad Kaviani, Suez’ managing director for Southeast Asia.

Metro Pacific Water, a wholly owned subsidiary of Metro Pacific Investments Corp. (MPIC), operates water and wastewater concessions across the Philippines and in Vietnam.

Its subsidiary in Iloilo, Metro Pacific Iloilo Water, a joint venture with Metro Iloilo Water District, serves Iloilo City and the Municipalities of Pavia, Leganes, Sta. Barbara, Cabatuan, Oton, San Miguel, and Maasin.

MPIC is one of three key Philippine units of First Pacific, the others being Philex Mining Corp. and PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera

MWSS penalizes Maynilad with P3.92-M rebates for poor water quality in Imus

Image by Rudy and Peter Skitterians from Pixabay

MAYNILAD Water Services, Inc. will issue rebates totaling P3.92 million to some customers in Imus City, Cavite, as a penalty from the Metropolitan Waterworks and Sewerage System Regulatory Office (MWSS RO) for poor water quality.

The MWSS RO announced during an information drive on Wednesday that each of the 3,494 affected water connections will receive a rebate of P1,122.37, which will be reflected in their monthly bills starting July.

The rebate program will be implemented across nine barangays in Imus City that were affected by the water quality issue.

The regulator imposed the penalty due to water color and residual chlorine identified at the Anabu Modular Treatment Plant and its supply zone in Imus City.

The MWSS RO previously announced that it had imposed a financial penalty of over P2 million on Maynilad in the form of rebates to affected customers due to high levels of bacteria detected at a sampling point in Caloocan City last November.

Each of the 3,841 affected water connections will get a rebate of P530.69.

Maynilad earlier said in a statement that the incidents were “promptly addressed and resolved.”

“Maynilad is committed to providing the highest quality water and will continue to take proactive measures to ensure the reliability and safety of our services,” the water concessionaire has said.

The company said it will continue to work closely with MWSS RO and Department of Health in monitoring the quality of the water supply distributed to its customers.

Maynilad serves the cities of Manila, except San Andres and Sta. Ana. It also operates in Quezon City, Makati, Caloocan, Pasay, Parañaque, Las Piñas, Muntinlupa, Valenzuela, Navotas, and Malabon. It also supplies the cities of Cavite, Bacoor, and Imus, and the towns of Kawit, Noveleta, and Rosario, all in Cavite province.

Metro Pacific Investments Corp., which has a majority stake in Maynilad, is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being 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. — Sheldeen Joy Talavera

Globe, Lynk team up to boost communication in remote areas

PONGSAWAT PASOM-UNSPLASH

GLOBE Telecom, Inc. announced on Tuesday a partnership with Lynk to assess the potential of satellite-direct-to-phone communication services in remote areas of the Philippines.

“The recent signing of the new agreement signifies a crucial step towards enhancing connectivity and communication access within the country, particularly in unserved and underserved areas,” the telecommunications company said in a statement.

Lynk is an international company that develops satellite-to-mobile-phone constellation technology to enhance mobile phone service coverage.

The partnership aims to bring and enhance connectivity in the country, especially in remote and underserved areas, Globe said, adding that the collaboration covers a one-year period or until June 2025.

“We are looking for a solution to bring life-enabling connectivity to as many Filipinos as possible. Through this satellite-direct-to-phone service, we hope to provide access wherever our customers are, connecting the unconnected through disruptive technology,” Globe Director and Head of Network Strategy and Technology Enablement Gerhard Tan said.

The company said pilot areas for the program are Zambales, Pangasinan, Siargao, and Leyte.

Globe also said the program will take advantage of Lynk’s low-Earth-orbit (LEO) satellite constellation to deliver short-message service, IP-messaging apps, and emergency alerts in target regions without traditional network coverage.

“These regions include far-flung locations with existing Globe enterprise clients and government installations, as well as tourist destinations with limited or unreliable cellular coverage,” Globe said.

Last year, the two parties conducted a field trial of the low-Earth-orbit satellite, making the telco company the first one to do so.

In 2022, the two companies signed an agreement for Globe to be able to use the LEO satellite as a mobile base station for standard unmodified phones.

At the local bourse on Tuesday, shares in the company closed P42 or 2.09 higher to end at P2,050 each. — Ashley Erika O. Jose

T-bond rates climb on hawkish BSP bets

BW FILE PHOTO

THE GOVERNMENT made a full award of the reissued Treasury bonds (T-bonds) it offered on Wednesday at a higher average yield than secondary market levels as investors expect both the Bangko Sentral ng Pilipinas (BSP) and the US Federal Reserve to keep benchmark interest rates elevated.

The Bureau of the Treasury (BTr) raised P30 billion as planned via the reissued 20-year bonds it auctioned off on Wednesday as total bids reached P51.097 billion.

The bonds, which have a remaining life of 19 years and 11 months, were awarded at an average rate of 6.86%. Accepted yields ranged from 6.8% to 6.9%.

The average rate of the 20-year bonds rose by 6.3 basis points (bps) from the 6.797% fetched for the series’ last award on May 21, but 1.5 bps lower than the 6.875% coupon for the issue.

This was also 2.9 bps higher than 6.831% quoted for the 20-year bond and 5.3 bps above the 6.807% seen for the same bond series at the secondary market before Wednesday’s auction, based on PHP Bloomberg Valuation Service Reference Rates data provided by the BTr.

Wednesday’s award brought the total outstanding volume for the series to P52.7 billion, the Treasury said in a statement.

“The higher rates were expected because of the hawkish sentiment on the BSP and the Fed. For [Thursday’s] rate decision, the BSP is expected stand pat because of sticky inflation and peso’s vulnerability,” a trader said by phone.

T-bond rates rose due to the Fed’s “higher for longer” stance and ahead of the BSP meeting on Thursday as the market awaits new policy signals from local monetary officials, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort likewise said in a Viber message.

The BSP is widely expected to maintain its policy stance for a sixth straight meeting on Thursday amid lingering risks to the inflation outlook and a weak peso, analysts said.

All 15 analysts in a BusinessWorld poll last week expect the Monetary Board to keep its policy rate at a 17-year high of 6.5% at its meeting this week.

BSP Governor Eli M. Remolona, Jr. has said the central bank could begin easing its policy stance as early as August and may slash rates by 25-50 bps in the second semester, adding they do not need to wait for the Fed to kick off its own rate cut cycle.

The US central bank this month left its target rate unchanged at the 5.25%-5.5% range for a seventh straight meeting, with Fed officials pricing in just one rate cut this year as late as December.

Fed policy makers continue to signal they are in no rush, with Fed Governors Lisa Cook and particularly Michelle Bowman stressing that decisions will depend on data, Reuters reported.

Ms. Bowman on Tuesday said that holding the policy rate steady “for some time” will likely be enough to bring inflation under control. She also reiterated her willingness to raise borrowing costs if needed.

Ms. Cook, for her part, said it would be appropriate to cut interest rates “at some point” given significant progress on inflation and a gradual cooling of the labor market. She remained vague, however, about the timing of the easing.

Wednesday’s T-bond auction was the last offering for June. The BTr raised P110.228 out of the P120-billion program for T-bonds as it made partial awards at two of its four auctions.

Including Treasury bills, the BTr raised P170.228 billion out of its P180-billion domestic borrowing program for the month.

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. — A.M.C. Sy with Reuters

The best new rosé wines aren’t from France

2021 Textura Pretexto Rosé — NY.VERVEWINE.COM

By Elin McCoy

CHILLED pink wine on a hot summer night is still the Instagram symbol of summer — and winemakers in every region on the planet are launching new ones to fill your glass.

Yes, France’s Provence — and its yacht-and-beach luxury lifestyle — have long been at the center of rosé’s glamorous image, championed this spring in The Book of Rosé: The Provencal Vineyard that Revolutionized Rosé (Rizzoli; $75).

Not so fast. Only 126 of the 437 rosés listed by giant online retailer Wine.com hail from Provence.

The rest come from other parts of France and from countries around the globe. In Chile and New Zealand and Eastern Europe, for example, pink winemaking has grown more than 50% over the past decade or so. That’s according to the 2023 Rosé Wines Tracking Report, a collaboration between the Provence Wine Council and France AgriMer that covers 45 countries.

I’ve recently tasted more than 150 pink wines — even a rosé sake. Among them were fascinating new bottlings from New Mexico and Japan, Barolo country in Italy, Lebanon, islands in Greece, and tiny wineries in Oregon and California. (Wine.com’s 56 Golden State examples don’t include the many rosés made in minuscule quantities by top Napa producers and now offered in winery tasting rooms and available for direct purchase.)

Today’s wide range of hues, grape varieties, and winemaking techniques mean bigger choices in style than ever.

The new pricing sweet spot roughly hovers from $20 to $35, which shows that most pink wines aim to be more than vin piscine, those swimming pool quaffers served in large glasses with lots of ice. There’s a surge in pink sparkling wines, $50-and-up luxury Napa rosés and serious oak-aged examples — which are not always so appealing.

By the way, don’t shun the premium rosés showing up in dark glass bottles instead of clear glass that shows off the lusciously pink color. The reason is “light strike.” Rosé is particularly susceptible to damage from exposure to sunlight; it can cause the wine to end up smelling like wet dog or old cabbage.

I know that general wine consumption has been shrinking, particularly for red wines. The fate of rosé doesn’t need rose colored glasses: Production is growing and more than one in every 10 bottles consumed globally now is pink, with the popularity of premium, high-quality bottles unabating, especially members of Gen X and Gen Z. CGA’s 2023 Wine Insights Reports revealed that 21% of British consumers were drinking rosé more often than a year earlier. In May, the Santa Margherita wine brand unveiled a survey of 2,000 Americans nationwide, undertaken by Talker Research, that found rosé the favorite wine for celebrations.

Still, a caution: A lot of new, boring rosés are out there. My 14 picks below are not. — Bloomberg

 

Summer 2024 Rosé Wine Buying Guide

2021 Textura Pretexto Rosé ($19)

Founded in the Dão region of Portugal in 2018, this family wine project enlisted famed winemaker Luis Seabra to oversee its range of reds and whites. Now, it’s added this fresh, juicy rosé made from red jaen grapes (called mencia in Spain). It’s elegant, mineral, and complex.

2023 Vara New Mexican Rosé ($19)

At this pioneering winery, the first rosé from New Mexico-grown grapes blends 70% cabernet sauvignon with 30% refosco. It shows that a juicy, savory pink wine can emerge even from a harsh desert climate.

2021 Fiol Prosecco Rosé Extra Dry ($18)

I sampled this just-launched, sophisticated, light coral-pink wine last week. It’s smoother and more subtle than most rosé proseccos, with berry and floral aromas and a soft, salty-fruit taste. Perfect pool drinking at only 11% alcohol.

2021 Mallea Vineyards Rosé of Grenache ($20)

Check out the label on this lively rosé with cherry-ish flavors from a new, small Santa Barbara, California, collaboration between viticulturalist Erik Mallea and winemaker Justin Willet; they aim to produce Rhône varietals from organic grapes. The label art echoes the messages Basque shepherds in the American West carved into tree bark in the 19th and 20th centuries.

NV Missing Thorn by Aaron Pott Sparkling Rosé Alcohol-Removed Wine ($24)

Super pleasurable to sniff and sip! A new line of nonalcoholic wines created by veteran Napa winemaker Aaron Pott has debuted. The sparkling rosé boasts rose petal, citrus, and brioche aromas that remind me of older vintages of Champagne. The taste is succulent and citrusy, with a long finish.

2022 Ousyra Fokiano Rosé Cyclades ($24)

This charming, organic Greek rosé is made at a boutique winery on Syros, one of the Aegean Islands. The name of the winery means happiness. Richly fruity, it’s made from rare indigenous fokiano grapes grown on the island of Naxos.

2023 The Language of Yes Les Fruits Rouge Pink Wine of the Central Coast ($28)

Ever inventive California winemaker Randall Grahm began a partnership with Gallo with the 2020 vintage, but this 2023 is only the second vintage of his pale pink, easy to drink cinsaut- and grenache-based rosé. Think of it as a spicy California version of Provence pinks, with aroma notes of dried herbs.

2022 Maugeri Contrada Volpare Etna Rosato ($30)

Sicily’s trendy Mount Etna region is noted for reds, but this new, exciting winery project focuses on rosé and whites. The striking, coppery colored rosato from a single vineyard is light and vivid and also shows wonderfully complex flavors of salty minerals, fresh herbs, and ethereal fruit. Pair with grilled salmon.

2023 Ridge Lytton Estate Rosé ($35)

This isn’t new. But until very recently, practically no one (including me) knew that this winery, famous for its stunning Monte Bello cabernet, made a rosé. The blend of grenache, zinfandel, Mataro, cinsaut, and counoise from Ridge’s estate in Sonoma is rose petal-scented, subtle and crisp, with deep flavors of mint and strawberries.

2021 Grape Republic Rosa Frizzante ($40)

A pét-nat for adventurous drinkers who are also tracking the newest new thing: Grape Republic, founded in 2017, has become a big name in Japan’s natural wine scene. This is the second vintage of its ripe, round, lightly sparkling blend of hybrid red and white grapes, and it’s just arrived in the US.

2022 J.H. Wheeler Rosé ($48)

Delicate, yet layered describes the third vintage of this fruity-chalky pink wine made from 40-year-old Napa Valley cabernet franc vines. The label, reborn several years ago, makes mostly expensive ($225 and up per bottle) single-vineyard cabernets. It has added a rosé that now sells out first. Only 167 cases made.

2023 Realm Precious Twin Rosé ($63)

I raved about this Napa cult winery’s first rosé, La Fe, created in the 2020 vintage when wildfires and smoke ensured they couldn’t make any pricey cabernet. This new savory orangey-pink cuvée is a different blend — merlot with 10% charbono — and it’s rich, complex, and succulent.

2022 Gut Oggau Cecilia Rosé ($72)

This is the second vintage of a new, idiosyncratic, no-sulfur rosé from a cult biodynamic Austrian producer. It’s a delicious field blend of red and white grapes from a single plot, with two-thirds pressed directly and one-third macerated for a short time to pick up color from the skins.

2019 Château Gassier Elevae ($125)

I can’t resist including this single French pick, a new, impressive, bold, oak-aged rosé from Provence’s Saint-Victoire area. The blend of five grapes, all organically grown, shows floral and pomegranate aromas and spicy oak flavors. Think of this as a rosé for red wine drinkers. The winery says it’s perfect with wagyu beef chop aged in Himalayan salt. Sounds good to me.

Failure doesn’t breed success — except when it does

FREEPIK

A NEW SCIENTIFIC PAPER on failure may have succeeded in offering the most depressing opening line in the history of scientific papers: “Is there anything failure does not ruin? It destroys reputations, careers, and families; economic prospects, political prospects, and social ones.”

That’s perhaps a useful corrective to all the graduation speakers, motivational gurus, and TED-talk-giving experts who glibly recount how they persisted, failure after failure, on the way to success. It’s easy to forget that many more people fail at least as many times and never achieve their goal. There are many more frustrated authors than best-selling ones, failed entrepreneurs than self-made billionaires, and actor-baristas than bona fide movie stars.

But the situation may not be quite as depressing as the new paper suggests. There are some sub-categories of failure that do seem to spawn success, and there are ways of responding to failure that can improve your prospects.

The important finding in the paper, published in the Journal of Experimental Psychology: General, is that people tend to overestimate how easy it is for others to overcome failures — like failing a test or overcoming addiction.

“Our goal was to better understand resilience and what gets into people’s way,” said lead author Lauren Eskreis-Winkler of Northwestern University’s Kellogg School of Management.

Her results indicate that we overestimate how much people learn from failure. For example, one experiment used a language-learning game in which people got feedback when they chose the wrong answer. Those who paid attention to the feedback improved. But fewer did so than participants expected.

Resilient people are those who are willing to look failure in the eye, she said. But such people are rare, she said, because looking squarely at our failures makes us feel bad about ourselves.

People also tended to overestimate the role of willpower in overcoming failure. There’s a long history of attributing addiction to a failure of will, for example. Scientists have more recently come to see addiction as a disease. To recover, people need more than determination — they need medical help. Eskreis-Winkler said that by debunking myths about the ease of success after failure, the researchers were able to convince study subjects to support programs to help people avoid relapse.

But perhaps not all failures are the same. Another scholar at Kellogg, Dashun Wang, found that in some cases, certain kinds of failures do propel people to success.

Falling short can help, in the long run, when a competition is fierce and those who are near-miss losers are indistinguishable in skills and qualifications from the close winners. In a paper published in 2019 in Nature Communications, Wang looked specifically at data on more than 700,000 scientists applying for grant money from the National Institutes of Health (NIH). He got data from the NIH on whose proposals were close to the cutoff: the by-a-whisker winners and losers.

And Wang found that in subsequent years, the scientists who nearly missed were more successful than those who squeaked out a victory. One explanation might be that the near misses were more motivated to work harder and address their weaknesses, while the winners were more complacent. Perhaps, he said, there’s an ideal dosage of failure. (Moreover, everyone gets feedback on their grant proposals, whether they’re accepted or rejected.)

And of course, once you’ve failed, your chances of success are zero if you don’t try again. So, an important consideration is whether it’s worth your time and effort to study harder for that bar exam or whether you’re more likely to find success in some other career path.

Eskreis-Winkler emphasized that people fail repeatedly because they don’t accept feedback — they don’t look failure in the face.

You’re more likely to get good feedback from people you already work with than people who want to hire you. These days, employers think it’s okay to ghost candidates who put hours into applications or interviews. Unsolicited manuscripts rarely get a response. Failed auditions might get only vague comments about a “lack of fit” or “going in a different direction.”

The problem is that the gatekeepers who make these decisions don’t benefit from putting in the extra effort to tell failed applicants what they didn’t like. For useful career feedback, what you need are collaborators or employers who are invested in your success.

So failure can lead to success, but only under the right circumstances. Life is more complicated than motivational speakers make it sound, but if we come back to the question posed at the opening of the new paper, “is there anything failure does not ruin” — the answer is probably yes.

BLOOMBERG OPINION

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