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Intangible assets are assets

FREEPIK

When you hear of the terms AOC, DOC, DOCG, what comes to mind? French and Italian wines, cheese, and other produce that are priced at a premium.

When you use the word “champagne” for any sparkling wine, be careful. “Champagne” can only be used for sparkling wines from the Champagne region, and which are made using the “method champenoise,” a special technique implemented in this region of France for many centuries now. This name is also protected by a Geographical Indication (GI) and is legally protected in the European Union and many other countries. Because of this GI and Intellectual Property (IP) registration, all other sparkling wines are not “champagne” but are called other names: Prosecco in Italy, Cava in Spain, and sparkling wine in other places. Now, that is protection for champagne! And this is why champagne, besides its meticulous method of production, is priced at a premium and keeps its value compared to other “bubblies.”

How about Kampot pepper from Cambodia? And Guimaras mangoes from Guimaras island in the Philippines? These products start out with having collective marks and then graduate to become GI assets, protecting the producers and the community in the region where they are produced. Thanks to the World Intellectual Property Organization or WIPO (www.wipo.int), these IPs are protected so creators, innovators, and communities can use them for economic and sustainable growth.

How is this used as a tourist draw to benefit a community? Tourists often want to see the place where the cheese is produced, where the balsamic vinegar is processed, and how you can make special pepper that sells for more than five times the price of its general commodity cousin. GI and other IP registrations provide more income to the producers, either by the export of the products or by drawing in tourists to its very origin, the place where the agricultural product is produced. We can name many examples, like Ha Giang tea of Vietnam, Son La coffee of Vietnam, and Preah Vihear rice of Cambodia. These may otherwise be ordinary commodities but with the addition of GI, they become specialty products with a premium.

In the Philippines, we can think of many products that can carry a GI, such as Sulu coffee, Benguet coffee, Batangas Liberica, Criollo cacao from Bohol, Bicol pili (now nearing GI status), Sukang Iloko, Malabon patis, Tultul salt, Miag-ao salt, and more.

The only work we need to do is educate the producers and the communities to be able to protect their ancestral traditions of food production. Thanks again to Director-General Rowel Barba of the Intellectual Property Office of the Philippines (IPOPHIL), we are now adding to the roster of our GI-registered products.

This is a good investment for the communities who otherwise just sell their produce as commodities. Think of heirloom rice from Kalinga and Ifugao which could have collective marks. Think of Carcar lechon in Cebu, pomelo from Davao, mangosteen, marang, and durian. Civic organizations who continue to help farming communities can also help them be sustainable through IP registration. And GI is a way to do it. They can add value to their produce once they have a GI — and consumers are assured they are getting the right, original, and authentic product as claimed. It sounds easy and IPOPHL can hold our hands in doing this.

The Department of Tourism (DoT) can also help transform areas into GI destinations for food lovers and enthusiasts, as the trend worldwide is to find the product at the source. Already, the DoT has started by joining Slow Food (www.slowfood.com) in using food as a hook for tourists looking for gastronomic destinations.

The Department of Trade and Industry (www.dti.org) can help products with GI be showcased in food fairs abroad or in our very own consular offices or Philippine Centers, like those in New York and San Francisco.

But first, we must educate the consumers to look for “the mark.”

In Slow Food events, we look for Presidia* products, like a special fish sauce called Colatura, or a special cheese produced only in a specific region. We look for Normandy oysters, as we can also look for Tayabas Bay oysters. But are they registered as GI?

The Europeans were way ahead in making their products special and protected with marks like France’s AOC (Appellation d’Origine Contrôlée or Controlled Designation of Origin), DOC (Denominazione di Origine Controllata, Italy’s version of AOC), and DOCG (Denominazione di Origine Controllata e Garantita, the highest Italian classification for wine). And the WIPO makes sure governments abide by updated rules on all these individual classifications of wines, cheese, and other agricultural products.

But wait, there are other IPs that can boost economies. These can be trademarks, like Café Amadeo in Cavite. It is a registered trademark, not a GI, and yet Batangas is jealous that Cavite has pulled the rug from under their feet as the original source of Barako coffee. I explained that Amadeo is known for Philippine coffee in general, not specifically Liberica or Barako which Batangas may still claim. Amadeo’s local executives, way back in 2002, had a vision of promoting Philippine coffee and tagged themselves as the “Coffee Capital of the Philippines” and no one questioned or challenged such a claim. If you have been using a tag like this with no opposition from anybody, you can claim and register it as your own.

That is what intellectual assets and IP protect. IP rewards creators, innovators, and visionaries. And translate simple origins or names of origins into prime assets — for as long as they have a plausible story of being the original source.

Do check the rules on IP marks.

*According to www.slowfood.com, these are “small-scale food productions that protect traditional and artisanal products that are at risk of disappearing.”

 

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

Universal Music Group and Spotify strike new agreement

UNIVERSAL MUSIC GROUP (UMG), the world’s biggest music label, and Swedish streaming giant Spotify reached a new multi-year agreement for recorded music and music publishing, they said on Sunday.

The publishing agreement establishes a direct license between Spotify and UMG across Spotify’s current product portfolio in the US and several other countries, they said in a statement.

“Artists, songwriters and consumers will benefit from new and evolving offers, new paid subscription tiers, bundling of music and non-music content, and a richer audio and visual content catalog,” the companies said.

The partnership will ensure constant innovation, making music subscriptions even more attractive to a broader worldwide audience, Spotify founder and CEO Daniel Ek said.

Spotify has laid off employees, pulled back podcasts, and cut marketing spending over the past year to boost profitability. It has also raised prices of its US plans to capitalize on demand for its premium products. — Reuters

BoJ may revert to fuzzy communication on policy after Fed-style clarity on rates

REUTERS

TOKYO — The Bank of Japan (BoJ), after clearly signalling last week’s interest rate hike, may return to its accustomed fuzzy guidance about central bank policy to maintain flexibility when it eventually begins to consider how much tightening is enough.

The BoJ fumbled its communication in December, surprising investors when it left rates steady, but then telegraphed Friday’s increase so unambiguously that markets had 90% priced it in and took the move in stride.

That shift to clearer guidance, an approach the US Federal Reserve used in August to signal a policy shift, may prove temporary. Japanese policy makers fear being led by the markets and are unsure how far the BoJ can raise rates without cooling growth, say analysts and people familiar with the central bank’s thinking.

Policy makers are wary of feeling they must give clear signals before each meeting, given an uncertain economic outlook, and they lack conviction about the Goldilocks “neutral” interest rate that neither chills nor overheats the economy.

After the BoJ caught markets off guard with December’s decision, Governor Kazuo Ueda flagged uncertainty over US economic policy ahead of Donald J. Trump’s return as president as a key reason it had refrained from raising rates.

Considered dovish, Mr. Ueda’s comments pushed down market pricing of January action to 46% from 70%.

Keen to avoid startling markets again, the BoJ then laid the groundwork for the January hike, taking a page from Fed Chair Jerome H. Powell, who had explicitly signaled an imminent shift by pronouncing that “the time has come for policy to adjust.”

COSTS OF CLARITY
Mr. Ueda and his deputy Ryozo Himino each said during the week before Friday’s hike that the BoJ board would “debate whether to raise rates” — effectively pre-announcing its decision to double short-term rates to 0.5%.

“Without those comments, a January hike would have been a huge surprise,” said Naomi Muguruma, chief bond strategist at Mitsubishi UFJ Morgan Stanley Securities. “The BoJ probably had no other choice.”

Asked about the advance warnings, Mr. Ueda said after Friday’s decision they were simply a “reminder” that the board would discuss the feasibility of changing policy at every rate review.

But while the strategy let the BoJ smoothly raise its policy rate to the highest in 17 years, it is not without cost.

Markets may focus too much on BoJ commentary, rather than scrutinizing economic and price data, to gauge the bank’s next rate hike, analysts say.

Giving explicit advance signals, in addition to making the BoJ feel boxed in, could breach Japanese law stipulating the nine-member board must debate and sign off on rate decisions at each policy meeting.

“It raises some alarm bells,” a former policy maker said of the BoJ’s communication about Friday’s rate hike. “The market ought to be a guide for central banks on how the economy is doing. But if this practice continues, the BoJ will only see in the market a reflection of itself.”

‘GREATER VARIABILITY’
Another reason to revert to ambiguity is uncertainty over the end point for tightening.

BoJ staff estimates Japan’s nominal neutral rate between 1% and 2.5%. While that has not been a factor so far with the policy rate so low, two more hikes would bring it to the bottom of that range — a level many analysts consider the neutral rate.

Indeed, while signalling the bank’s resolve to keep raising interest rates, Mr. Ueda gave few clues on Friday of the pace or timing of further hikes and said it was hard to pin down Japan’s neutral rate in real time.

“Because the BoJ doesn’t know where exactly the neutral rate is, it would have to wait about six months after each hike to check the health of the economy,” said Izuru Kato, chief economist at Totan Research. “Only after judging that the neutral rate is still distant would it raise rates again.”

Other complications loom as the BoJ eyes further rate hikes, which could heighten challenges in trying to convince the public of the need to keep pushing up borrowing costs.

The bank justified Friday’s increase by citing prospects of sustained wage gains, but it is uncertain whether consumption can weather rising living costs.

Trump’s threats of higher tariffs could weigh on Japan’s export-reliant economy and business sentiment.

“The BoJ’s hands are looking increasingly tied with the complex task of managing price pressures, reflation efforts and market expectations all together,” said Frederic Neumann, chief Asia economist at HSBC Bank, adding that risks surrounding Mr. Trump’s policy cannot be dismissed.

“These all translate to greater variability as to the policy rate path going forward.” — Reuters

The INC rally — a protest against the impeachment of VP Sara

PHILIPPINE STAR/EDD GUMBAN

On Dec. 4, the Iglesia ni Cristo (INC) announced it would hold rallies in 13 different sites, including at the Quirino Grandstand, on Jan. 13 in support of the opinion of President Ferdinand “Bongbong” Marcos, Jr. regarding the impeachment efforts against Vice-President Sara Duterte.

Having learned that some members of the House of Representatives were planning to impeach VP Duterte, Mr. Marcos Jr. had said on Nov. 29: “What will happen if somebody files an impeachment? It will tie down the House, it will tie down the Senate. It will just take up all our time and for what? For nothing, for nothing. None of this will help improve a single Filipino life. As far as I’m concerned, it’s a storm in a teacup.”

For Mr. Marcos to say that filing an impeachment complaint will just take up all our time for nothing is like saying that Article XI of the Constitution is dysfunctional and therefore should not be invoked. It was arrogant and impertinent of him to trivialize a right bestowed by the Constitution on the members of the House of Representatives, a branch of government co-equal with the executive branch. The members of the House could have returned the offense by asking him if his 27 foreign trips, including two visits to Singapore to see the Grand Prix, has helped improve a single Filipino life. In contrast, they chose to be civil and deferential. I am mystified though why no constitutional lawyer has slammed him for those brazen remarks.

I tend to think Mr. Marcos made those contemptuous remarks to discourage Duterte loyalists in the House of Representatives who may be plotting to impeach him at some point during his incumbency. VP Duterte is accused of misusing confidential funds. Duterte loyalists in the House can easily turn the tables on the President by accusing him of misusing his own huge confidential funds.

Supreme Court Chief Justice Renato Corona was charged with betrayal of public trust for failing to disclose to the public his statement of assets, liabilities, and net worth as required under the Constitution, and for blatantly disregarding the principle of separation of powers by issuing a status quo ante order against the House of Representatives. Mr. Marcos has yet to disclose his statement of assets, liabilities, and net worth. He also blatantly disregarded the principle of separation of powers by dissuading congressmen from impeaching VP Duterte.

Anyway, on Dec. 2, 2024, an impeachment case against VP Duterte was filed with the Secretary General of the House of Representatives. She was accused of graft and corruption, bribery, betrayal of public trust, and other high crimes. On Dec. 4, a second impeachment complaint against her was lodged, citing betrayal of public trust over the illegal use and mishandling of confidential funds. On Dec. 5, a third complaint of betrayal of public trust was filed. All these initiatives are in accordance with the law.

The Iglesia ni Cristo publicized rallies took place on Jan. 13, culminating at the Quirino Grandstand, Rizal Park, Manila. The Philippine National Police estimated that 1.6 million people had gathered in front of the grandstand and in adjacent areas.

Rommel Topacio spoke first. He said, “There is a saying that ‘united we stand, divided we fall.’” That is why he called on government officials to not allow us to be divided. He asserted that this gathering of the INC was a concrete expression of support for the earlier statement of President Bongbong Marcos that he did not agree with the proposed impeachment of VP Duterte.

Next to speak was Edwil Zabala, spokesperson of INC. He expressed support for President Marcos’ opinion that impeachment proceedings against VP Duterte would just be a waste of time. He did emphasize that the true aim of the rally was for peace, and that peace can only be achieved if the law is respected and implemented.

If the rally was for peace, then it was a monumental waste of effort and time as there was no ongoing conflict. Any impeachment move against VP Duterte is in accordance with the basic law of the land — the Constitution. Article XI of the 1987 Constitution states that the president and vice-president, among other appointed officials, may be removed from their posts “on impeachment for, and conviction of the following”: culpable violation of the Constitution, treason, bribery.

The INC’s National Rally for Peace was patently and unashamedly a show of force to intimidate those congressmen running for re-election on May 12, Election Day, with repudiation if they push for the impeachment of VP Duterte.

Rodante Marcoleta, a prominent INC faithful and Party-List representative, opened his speech with the statement that the INC agrees with Mr. Marcos’ opinion that impeachment proceedings are a waste of time. He then lambasted the QuadCom for “summoning” former president Rodrigo Duterte to shed more light on his “war on drugs” and for the inquisitorial manner in which the QuadCom members questioned Mr. Duterte. Mr. Marcoleta’s polemic was certainly discordant in a supposed rally for peace.

Rep. Marcoleta was not entirely honest. He said the QuadCom summoned Mr. Duterte. The truth is the QuadCom invited Mr. Duterte, who declined at first but accepted when invited again. Mr. Marcoleta also said that the Chief of the PNP was not summoned to explain what the “war on drugs” was. Again, the truth is that former PNP chief Ronald Bato dela Rosa was invited but he declined, invoking inter-parliamentary courtesy as he is a senator. Mr. Marcoleta lamented the QuadCom’s rule that Mr. Duterte’s lawyers could not speak. But during the hearing on the renewal of ABS-CBN’s franchise in June 2020, he objected repeatedly and sternly whenever Gaby Lopez’ lawyer tried to speak.

Mr. Marcos’ legal adviser, Juan Ponce Enrile, a legal eagle and former Senate president and presiding justice in the impeachment trial of Chief Justice Renato Corona, noted there would be “a very detrimental precedent if we follow the logic implicit in the INC rally” (and explicit in the statement of President Marcos) which is that impeachment is more a matter of political expediency than a constitutional mechanism to remove an erring official.

According to the Philippine Statistics Authority (PSA), based on the 2020 census, there are 2,806,524 Iglesia ni Cristo members. With the annual rate of increase of the population at 1.5%, the number of INC members by 2024 would have grown to 2,978,742. The PNP’s estimate of the people who joined the INC rally on Jan. 13 was 1.6 million. That means more than half of the total INC members showed up around the Quirino Grandstand that day.

The PSA says those 18 years old and older constitute 63% of the population. That means there are 1,876,607 INC members of voting age. In the 2022 general elections, 56 million Filipinos voted. Therefore, INC voters constitute only 3% of the voting population. If the INC’s National Rally for Peace was a show of force to intimidate congressmen pushing for the impeachment of VP Duterte, it was a flop.

Besides, the Iglesia ni Cristo’s influence on the voting population has been proven to be a myth. It does not announce who its anointed candidates are until a week before Election Day, when the rankings of the candidates in the polls shall have stabilized. It endorses candidates not on the basis of any moral or political standard but on who the public opinion polls show to be the most likely winners.

That has been shown to be true in past electoral exercises. In 2004, it delayed its endorsement of Gloria Arroyo until the week before Election Day when she emerged as being ahead of Fernando Poe, Jr., the rumored preference of the sect, in the polls. In 2010, it switched from Senator Manuel Villar to Senator Noynoy Aquino five days before Election Day, when Aquino had dislodged Villar as topnotcher in the polls.

In 2019, it announced close to Election Day which 12 senatorial candidates it was endorsing. All were among those who occupied the top 12 spots in the last survey conducted by Pulse Asia that year.

In 2022, JV Ejercito unwittingly revealed the practice of the INC with regard to its endorsement of candidates. In an episode of the TV talk show Headstart, Ejercito said he was not endorsed by the INC in 2019 because the last survey done before the INC announced who it was endorsing for the Senate that year did not show him to be among the probable winners. But the survey conducted after the INC had announced who it was endorsing showed him to be among the probable winners. But it was too late for the INC to change its lineup as Election Day was nearing. To make it up to him, the INC endorsed him in 2022.

Various civil society organizations like the Makati Business Club and the Catholic lay group Couples for Christ may soon announce who among the senatorial candidates they will endorse. Observe that the Iglesia ni Cristo will announce who they will endorse a week before Election Day when the Social Weather Stations and Pulse Asia shall have made their final lists of most probable winners among the senatorial candidates.

 

Oscar P. Lagman, Jr. has been a keen observer of Philippine politics since the late 1950s.

MWSS seeks retained water allocation for February

PHILIPPINE STAR/KRIZ JOHN ROSALES

THE METROPOLITAN Waterworks and Sewerage System (MWSS) is seeking the approval of the National Water Resources Board (NWRB) to maintain an allocation of 52 cubic meters per second (cms) for February amid the high water level at Angat Reservoir.

“MWSS will continue to request maintaining the 52 cms allocation since the water level at Angat Reservoir remains high,” Patrick James B. Dizon, manager of the MWSS water and sewerage management division, said in a Viber message on Monday.

The MWSS is mandated to ensure an uninterrupted and adequate supply and distribution of potable water and maintenance of sewerage systems in its service area in Metro Manila and parts of Cavite and Rizal.

The NWRB, on the other hand, manages and regulates all water resources and services in the Philippines, based on its website. It determines and approves the monthly water allocation for MWSS based on the status of the Angat Reservoir, weather updates, and the request of MWSS.

Angat Dam is the main source of water for Metro Manila, accounting for about 90% of the capital’s potable water.

As of Monday morning, the Angat Dam water level was at 212.72 meters, lower than the 212.84 meters seen the previous day, according to the government weather service, known as PAGASA (Philippine Atmospheric, Geophysical and Astronomical Services Administration).

These readings were higher than the normal high-water level of 212 meters.

“Fortunately, due to the rains in the watershed, we were able to store additional water, giving us confidence that the water supply will be sufficient for this summer,” Mr. Dizon said.

The Philippines experienced the El Niño phenomenon, which began in June 2023 and triggered below-normal rainfall conditions, dry spells, and droughts that affected water supply, power generation, and crop production. The phenomenon ended in June last year.

Earlier this year, PAGASA said that La Niña is likely to continue at least from January to March, bringing higher chances of above-normal rainfall. — Sheldeen Joy Talavera

German film The Investigation aims to educate young viewers on Auschwitz horrors

Die Ermittlung (2024) — IMDB
Die Ermittlung (2024) — IMDB

BERLIN — Against a darkened TV sound stage, a woman testifies before judges on a bare black platform about how her boss at the Auschwitz Nazi death camp, Boger, killed a newly arrived boy.

“The boy stood there with his apple. Boger went to the child and picked him up by the feet and dashed his head against the barracks wall,” the woman recalls as the camera pans across Boger, sitting behind her, his face impassive.

“Since then, I have never wanted a child of my own.”

Her testimony is one of several by defendants and witnesses re-enacted in The Investigation, a new film by German director RP Kahl based on a play of the same name that dramatizes the trials of 22 Auschwitz personnel in Frankfurt from 1963-65.

Testimonies at those trials give just a small glimpse of the suffering experienced by the estimated 1.3 million people sent to Auschwitz in Nazi-occupied Poland as part of Adolf Hitler’s “Final Solution” to annihilate European Jews.

“What particularly intrigued me about the play was its ability to depict Auschwitz without the need for total immersion in its unimaginable reality,” Kahl told Reuters in Berlin.

Kahl said he had opted for a more contemporary cinematic style to appeal to younger viewers: “We filmed in a television studio with multiple cameras to create an immersive visual experience. We aimed to avoid creating a historical drama.”

With an eye to the 80th anniversary of Auschwitz’s liberation by Soviet troops on Jan. 27, Mr. Kahl said he hoped his movie would make it easier for a new generation to engage with the Holocaust as the number of survivors dwindles.

The Investigation is also a reminder of the importance of maintaining a liberal, democratic society, and the constant vigilance needed to prevent a recurrence of atrocities like Auschwitz, he said.

“The film conveys the message that we all have a role to play in shaping our society and preventing such horrors from recurring,” said the director.

Six months after its debut in Germany, the four-hour film will be shown to Israelis in Tel Aviv on Monday, the 80th anniversary, while its international premiere is set for Jan. 31 at the Rotterdam festival in the Netherlands. — Reuters

Smaller rate cuts to boost PHL banks’ margins, Fitch says

Buildings are seen from Mandaluyong City, Aug. 17, 2024. — PHILIPPINE STAR/MIGUEL DE GUZMAN

HIGHER-FOR-LONGER interest rates could benefit large Philippine banks as this would support their margins, Fitch Ratings said.

“We believe Philippine and Singapore banks will be key beneficiaries if rates are higher than we expected,” the credit rater said in a commentary dated Jan. 26. “Our rated banks in these markets have good funding profiles and are in liquid banking systems that can capitalize on yields staying buoyant while keeping deposit rates lean. This should position them to enjoy modestly higher net interest margins (NIM) than in our base case, under this scenario.”

Fitch said borrowing costs are expected to begin easing in most large economies in Southeast Asia this year.

“But we believe banks in some regional systems would benefit if the decline in rates is shallower than we expect,” it said. “Banks’ capacity to cut deposit rates and manage wholesale funding costs will be key in determining outcomes. This capacity tends, in turn, to reflect the strength of their deposit franchise and the diversity of their funding mix.”

Fitch flagged risks such as US President Donald J. Trump’s higher import tariffs and other protectionist policies, which could stoke inflation pressures and impact the US Federal Reserve’s rate-cutting cycle.

“This increases the risk that policy rate cutting cycles in Southeast Asia could be shallower than we had anticipated. There have already been some signs in Indonesia and Vietnam of local-currency liquidity tightening, raising wholesale funding costs for banks, which we believe is linked to official intervention in foreign-currency markets and associated sterilization efforts.”

Markets are on a wait-and-see mode on the US central bank’s next steps following Mr. Trump’s inauguration last week. Fed policy makers are largely expected to keep rates steady in their Jan. 28-29 meeting, marking the first pause in the rate-cutting cycle that began in September, Reuters reported.

Data since the Fed’s December meeting has kept intact the core view among Fed officials that inflation will continue to move steadily, if slowly, towards 2%, with a low unemployment rate and continued hiring and economic growth.

“Nevertheless, low rates of inflation in the region mean that policy makers have some headroom to accommodate weaker currencies without breaching inflation targets, supporting their rate-setting autonomy,” Fitch said.

The Bangko Sentral ng Pilipinas (BSP) began its easing cycle in August last year, slashing benchmark interest rates by a total of 75 basis points (bps) to bring its policy rate to 5.75%. Fitch expects the policy rate to be at 4.75% at end-2025 under its base case, which would mean 100 bps in reductions this year.

While less rate cuts from the BSP this year could support the margins of big banks in the Philippines, smaller lenders may not see the same windfall, the debt watcher said.

“However, smaller Philippine banks may benefit less than their larger peers, as their weaker competitive advantage in chasing deposits and lending opportunities tends to constrain their NIM,” Fitch said.

Latest data from the BSP showed the banking system’s net profit rose by 6.4% year on year to P290 billion in the first nine months of 2024, driven by a 14% jump in net interest income.

Of this, universal and commercial banks’ net income went up by 7% to P271.73 billion in the nine-month period.

“Banks in many regional markets have tended to preserve NIMs by shifting lending towards higher-yielding segments. However, this may affect their risk profiles unless loss-absorption buffers are also adjusted. We expect such dynamics to play out again in 2025 where NIMs come under pressure,” Fitch added.

The credit rater also noted that the impact of policy changes on Southeast Asian banks’ asset quality would likely be limited.

“Banks’ credit costs would be more vulnerable if there were external shocks to economic growth. Upside surprises to rates could aggravate existing asset-quality risks in vulnerable pockets of some banking systems, such as micro and small and medium-sized enterprise lending in Thailand. However, regional authorities could also deploy relief to cushion debt strains, as the Thai government has done recently,” Fitch said.

“The region’s bank capitalization levels are mostly ample, so the impact of higher-than-expected bond yields on valuations of securities is unlikely to be a significant rating consideration.” — Luisa Maria Jacinta C. Jocson with Reuters

Healthcare, banking firms to boost office demand in Manila — CBRE

UNSPLASH

THE METRO Manila office market is expected to see new entrants from the healthcare and banking sectors this year, according to real estate services and investment firm CBRE.

“In this kind of market where we’re coming off a slow year, it’s encouraging that we’re seeing new entrants into the market,” CBRE Philippines Country Head Jie C. Espinosa said during a briefing last week.

He said industries seeking office space this year include healthcare, banking, financial services, and insurance.

“They want to enter and be in spaces that are predictable, less risky for them, and where they can readily start their operations,” Mr. Espinosa noted, adding that these firms aim to start within four to six months.

New entrants in the office market would help offset spaces vacated by companies from the information technology-business process management (IT-BPM) sector and the departure of Philippine offshore gaming operators (POGOs), he added.

Around 32% of vacated spaces in Metro Manila’s office market were from the IT-BPM sector, while 31% came from POGOs, CBRE Philippines Research Head Samantha Laureola told reporters.

“Starting from the third quarter onwards, we already saw a slight deceleration in the market,” Mr. Espinosa said.

“The one thing we did not anticipate was that the IT-BPM sector would also experience a bit of a slowdown. Due to the US elections, many decisions were delayed or put off.”

The Metro Manila market ended 2024 with about 1.78 million square meters (sq.m.) of available office space, according to CBRE. Of this, 51% or 903,500 sq.m. were vacated spaces, and 49% or 880,100 sq.m. were unleased.

This translated to a full-year vacancy rate of 19.9% for the Metro Manila office market in 2024, according to CBRE.

“Most of the vacated spaces were not necessarily just from the POGO sector but also from the IT-BPM sector. They’re not leaving; they’re simply downsizing in certain locations,” Mr. Espinosa said.

“But overall, the IT-BPM sector, although there was growth, that growth was mostly flat. It did not offset the decrease in take-up by the POGOs.”

In 2024, the average take-up of office space decreased to about 1,300 sq.m. from 1,400 sq.m. a year ago, mainly due to companies’ increased preference for flexible setups, such as work-from-home.

“Companies, even traditional space takers, are realizing that there’s not much need for space anymore. Instead of having workstations or offices, they provide more collaborative spaces, meeting areas, and amenities,” CBRE Senior Director Bryan Michael David told BusinessWorld.

To ensure more office space transactions, the Philippines must bolster the skillset of its workforce to attract more demand from foreign players, Mr. David said.

“If we prepare for that, maybe we can actually capture a bit of their market share later on, which will probably improve or increase demand here in the Philippines,” he added. — Beatriz Marie D. Cruz

Ranger Raptor 3.0L V6 now permanent in Ford lineup

FORD Philippines announced that it is permanently adding the Ford Ranger Raptor 3.0L V6 to its vehicle portfolio amid growing demand from Filipino customers.

Initially sold in a limited quantity of 300 units at its launch at the Philippine International Motor Show in October, the new Raptor variant has become one of Ford Philippines’ best-selling models.

“Due to the overwhelming demand from our customers, we are excited to announce that the Ranger Raptor 3.0L V6 will now be a permanent addition to our performance vehicle portfolio,” said Pedro Simoes, managing director at Ford Philippines, in a statement on Monday.

“The Raptor 3.0L V6 is a personal favorite, and I can’t wait for more customers to experience its exceptional power and unmatched versatility,” he added.

The Raptor variant is available at P2.74 million and in colors Arctic White, Absolute Black, Blue Lightning, Conquer Grey, and Code Orange.

Since its launch, the Ranger Raptor 3.0L V6 has drawn customers to Ford dealerships and test drive events, the company said.

“The enhanced availability of the Ranger Raptor 3.0L for Filipino customers further expands the Raptor brand in the country, complementing the Ranger Raptor 2.0L Bi-Turbo Diesel Engine,” said Mr. Simoes.

“Pickup enthusiasts now have the option to choose which Raptor pickup truck suits their needs and lifestyles,” he added.

Ford Motor Co. Phils., Inc. is the country’s third-top car manufacturer in terms of total vehicle sales in 2024, according to a joint report by the Chamber of Automotive Manufacturers of the Philippines, Inc. and the Truck Manufacturers Association.

Last year, Ford Motor Co. sold 27,997 units, representing a 10.6% decline from 2023 and a 5.99% market share. — Justine Irish D. Tabile

Trade non-growth and budget expansion

Last Friday the Philippine Statistics Authority (PSA) released the December — and hence, full year 2024 — merchandise (or goods) trade data. It showed that exports were flat at $73 billion for both 2023 and 2024, as imports marginally increased by $1 billion.

But what significantly changed was the further rise in China’s share of our imports, from 23.3% in 2023 to 25.7% in the 2024 total imports. The total trade (exports plus imports) with China in 2024 at $42 billion is larger than those of Japan plus the US combined at $41 billion, and is slightly lower than trade with our five ASEAN neighbors with a combined total trade of $46 billion (see Table 1).

This has a big implication on our foreign policy. If so much of our imports — our clothes, shoes, buses, trucks, gadgets, other consumer and capital goods — comes from China, why is there so much noise against China? It does not make sense. We should focus on trade and commerce, tourism and investment, and economics over war mongering with countries around the world, especially our Asian neighbors.

It is a good thing that Donald Trump is back in the White House. Trump has a record of having started no new US wars from 2017-2020. It is likely that this will be repeated in 2025-2028. Now war mongering versus China, the Ukraine war, and the Middle East war has significantly simmered down. I think the deep state operatives that promote the US’ endless wars abroad are scared that Trump will fire them soon, or that their agencies will suffer budget cuts.

OPPOSITION TO GAA
The General Appropriations Act (GAA) 2025 is now being implemented but the political opposition against it continues, mainly over the defunding of Philippine Health Insurance Corp. (PHIC or PhilHealth) whose subsidy this year is zero.

I will compare the proposed versus the approved budget for 2025. While there is a small decline in the overall budget, there are huge increases in the budgets of the departments of Public Works and Highways (DPWH) and Health (DoH), and Congress. And there are big declines in the budgets of the departments of Education (DepEd) and Social Welfare and Development (DSWD), in Budgetary Support for Government Corporations (BSGC), and, of course, zero for PhilHealth (see Table 2).

I believe that the fact that PhilHealth and the DoH are getting funding from smokers, vapers, and drinkers is problematic. The health establishment says that tobacco and alcohol are bad and hence, people should avoid these. Then, ironically, the same health establishment is happy when billions of pesos are collected from taxing more smokers and drinkers of legal products. The political opposition to GAA 2025, health advocates, and activists, are angry that PhilHealth gets zero this year from the taxes paid by smokers and drinkers.

To remove the irony of health being funded by unhealthy products, the earmarking of the proceeds from the tobacco tax to health agencies should be removed. The DoH and PhilHealth should get nothing from tobacco tax revenues, which should instead go to the general fund. That way, when revenues further decline due to there being fewer smokers and drinkers because of the high taxes — or due to greater illicit trade and smuggling — they will not be sad because they do not rely on it anyway.

With more public-private partnerships (PPP) in roads, airports, seaports and other infrastructure, there is little justification for the DPWH to have so large a budget. The priority should have been reducing the public debt stock, reducing interest rates or the cost of borrowing, and reducing public interest payments, from the projected P848 billion this year to below P500 billion or less. Interest payments from January-November 2024 were P705 billion, or equivalent to P2.1 billion/day. To be clear, that was interest payment alone.

And since there is no more virus crisis nor economic crisis, the budgets of the DSWD, state universities, and the Commission on Higher Education should further decline. The focus should be on fiscal responsibility, the aim should be for a balanced budget if not a budget surplus in years where there is no crisis in order to compensate for high budget deficits during years of economic crisis years.

 

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

Borgen creator says fiction challenged by Trump’s Greenland gambit

Borgen (2010) — IMDB
Borgen (2010) — IMDB

COPENHAGEN — The creator of the Danish political TV drama Borgen, Adam Price, says US President Donald Trump’s wish to control Greenland has created an “absurd” reality that has made it more challenging to write political fiction.

Trump’s refusal to rule out using military or economic power to take control of Greenland, a semi-autonomous territory of Denmark, has caught many by surprise, including Price.

“When reality becomes absurd, like I think it has become in recent weeks when we are talking about the current situation with Greenland and Trump and Trump’s demands, what are we to write?” Price said in an interview this week with Reuters.

“Because if I had pitched this as a new season of Borgen, I think most people would say, like five or 10 years ago, that I was completely out of my mind and had lost my sense of reality,” he said.

Price, 57, said he was concerned that what previously had been considered politically extreme or bizarre would increasingly be considered “normal” under Trump’s presidency.

In fact, Price did anticipate the current international focus on Greenland in the latest season of his fictional series from 2022, in which the vast Arctic island makes a significant discovery of oil and becomes the center of a power struggle between Denmark, Russia, China, and the United States.

As in that last season of Borgen, Trump’s remarks have thrust Greenland into the global spotlight, reigniting a public debate about independence and the island’s complicated relationship with Denmark, its former colonial power.

Borgen, which in Danish means “fortress” — a direct reference to the informal name for Denmark’s parliament — was first aired in 2010 and tells a fictional story of Denmark’s first female prime minister and her rise to power.

Price said one idea for a potential new season of Borgen could be to “make the EU sexy” in a dramatic way, as many viewers may find the European Union difficult to grasp.

“When you deal with politics that maybe on the surface seem more cold and not as emotional, you need to find topics that are really explosive when it comes to emotions,” he said. — Reuters

Monetary Board orders closure of rural lender

BW FILE PHOTO

THE BANGKO SENTRAL ng Pilipinas has ordered the closure of Emerald Rural Bank, Inc.

The central bank’s policy-setting Monetary Board, in Resolution No. 77. A dated Jan. 23, decided to prohibit the bank from doing business in the Philippines, pursuant to Section 30 of Republic Act No. 7653 or the New Central Bank Act, according to a circular letter posted on the regulator’s website.

Section 30 of the New Central Bank Act is focused on proceedings regarding receivership and liquidation.

“The Philippine Deposit Insurance Corp. (PDIC) has been designated as receiver with a directive to proceed with the takeover and liquidation of the aforementioned rural bank,” it added.

In a separate bulletin, the PDIC said it took over the bank and its assets, records and affairs on Jan. 24.

“The PDIC charter provides in Section 13, that a bank placed under liquidation shall in no case be reopened and permitted to resume banking business,” it said.

“Furthermore, Section 12 expressly provides that banks closed by the Monetary Board shall no longer be rehabilitated.”

The powers, functions and duties of directors, officers and stockholders of the bank have also been terminated upon its placement under liquidation, the PDIC said.

“Accordingly, the directors, officers, and stockholders shall be barred from interfering in any way with the assets, records and affairs of the bank,” it added.

“Therefore, anyone in possession of any asset and/or records of the closed Emerald Rural Bank, Inc. is advised not to allow or honor any transaction affecting the same without the consent of the receiver and to immediately turnover the said assets and/or records to the designated deputy receiver.” — Luisa Maria Jacinta C. Jocson