Facebook Instagram Linkedin Twitter Youtube
Home Blog Page 1641

SEC halts Hasmadai, charges Silverlion Livestock for money laundering

THE Securities and Exchange Commission (SEC) has issued a cease-and-desist order against Hasmadai Foundation, Inc. and its officials for allegedly engaging in the sale and offer of securities without registration.

The order also covers other entities such as Humanitarian and Spiritual Mission Apostulates of Davao and Asia, Inc., and Humanitarian Institute of Technology Corp., the SEC said in an order posted on its website on June 14.

The SEC ordered its enforcement and investor protection department to serve the order to Hasmadai and other similarly named entities.

According to the SEC, Hasmadai reportedly offers securities in the form of “mission support” or “charity mission support pledge form” in which donors may pledge P5,000 to P20,000.

Hasmadai allegedly practices a scheme that involves the pooling of investments from the public.

“The funds collected by Hasmadai were ostensibly used to support its educational mission partnership, humanitarian livelihood, charity mission, and spiritual mission as proclaimed in its charity mission support pledge form. But in reality, the donations are actually utilized to pay the guaranteed returns in the form of monthly missionary allowance due to existing members, which, in turn, ensures its continued operation,” it said.

“Hasmadai’s unauthorized investment scheme promises donors guaranteed monthly spiritual medical assistance ranging from 27% to 34% of the donation,” it added.

The SEC said the entities have not registered any securities and have not filed an application for the registration or license to sell securities, which are required under Republic Act No. 8799, also known as the Securities Regulation Code.

It added that the entities are operating in various areas across the Caraga region.

“Hasmadai’s articles of incorporation shows that it is an independent religious society, a nonstock, nonprofit corporation with no sustainable income or viable source of capital that merely relies on the solicitation of donations from its members. It cannot possibly sustain the payment of returns that it guaranteed to, or is guaranteeing, to its members and the investing public,” the SEC said.

The SEC said the entities may file a verified motion to lift the order to the commission en banc within five days from receiving the order.

BusinessWorld reached out to Hasmadai through its social media pages but did not receive a response as of the deadline.

SILVERLION LIVESTOCK TRADING
In a separate statement on Monday, the SEC said it filed a second money laundering case against Silverlion Livestock Trading Corp.

The SEC and the Anti-Money Laundering Council (AMLC) filed a joint complaint against Silverlion Chief Executive Officer Ryan Cagod Ladoing on June 4 for violating Section 4(b) of Republic Act No. 9160, also known as the Anti-Money Laundering Act (AMLA).

Under Section 4(b), money laundering is committed by any person who, knowing that any monetary instrument or property represents, involves, or relates to the proceeds of any unlawful activity, converts, transfers, disposes of, moves, acquires, possesses, or uses said monetary instrument or property.

Fraudulent practices and other violations of Republic Act No. 8799, otherwise known as the Securities Regulation Code, are among the unlawful activities or predicate offenses to money laundering, under Section 3(i) of the AMLA.

“The complaint was filed after Mr. Ladoing was found to be in possession of more than P14 million in cash during the conduct of a consented search by operatives of the Philippine National Police Anti-Cybercrime Group, together with the SEC Zamboanga Extension Office in 2022,” the SEC said.

“The search was conducted following investigations by the SEC which showed that Silverlion was soliciting investments ranging from P5,000 to P100,000, with guaranteed earnings of up to 35% within 15 days. The group also offered a special promo involving the car of choice of any investor who locks in P400,000 worth of investment for 60 days,” it added.

In October 2023, the SEC and the AMLC filed a complaint against Silverlion and its other officials after it was found to be in possession of around P17.89 million of cash during the implementation of a search warrant in Silverlion’s offices in Zamboanga City.

Silverlion has not secured the license to offer investments to the public. It is registered with the SEC as a corporation.

 “Prior to the filing of the complaints, the SEC has revoked Silverlion’s corporate registration and issued a cease-and-desist order against the company and its officers, directors and agents,” the commission said. — Revin Mikhael D. Ochave

Base Bahay targets to build 400 homes in Negros Occidental this year

DON JOSE BERENGUER BAMBOO VILLAGE in Sorsogon. — BASE-BUILDS.COM

BASE BAHAY said it plans to construct at least 400 houses using bamboo technology by the end of 2024, primarily in Negros Occidental.

The organization has completed around 180 socialized houses, Base Bahay Head of Technology Luis Felipe Lopez said in an interview on June 7.

“The trend is showing that probably 300 to 400 is the number that we’re going to get in the Philippines,” he also said.

The organization, which has established six bamboo supply facilities nationwide, said it focuses on providing sustainable, disaster-resilient, and environmentally friendly homes to poor families and disaster victims.

These homes are built using cement bamboo frame technology (CBFT), a method where a bamboo framework is covered with a thin layer of cement cladding to prevent decay, it said.

CBFT is accredited by the National Housing Authority’s Accreditation of Innovative Technologies for Housing.

Bamboo walls are elevated by 30, 40, and 50 centimeters to prevent contact with floods, Mr. Lopez said.

“We have been doing projects even in Metro Manila; we have 50 houses in Quezon City, in Bagong Silangan,” he added.

He said that the beneficiaries of The Bagong Silangan Kawayan Housing’s 25 single-story duplex units are families who previously resided in a dump site in Payatas and include members with disabilities.

“We have a livelihood component because they have a piece of land. They are producing vegetables for the food of all the families and the talipapa we built there also is to sell the excess of those vegetables,” he added.

Base also built houses for those affected by Typhoon Yolanda in the Visayas.

“The main idea is to build these houses maintenance-less. You don’t require any special maintenance, at least for the first 10 years. And then after 10 years, it’s the minimum maintenance as any conventional house,” Mr. Lopez said. — Aubrey Rose A. Inosante

Singapore-washing has hit a wall

MIKE ENERIO-UNSPLASH

CAN private wealth management hubs stay neutral and discreet in an increasingly polarized world? Private banks in Zurich lost some of their shine after Switzerland decided to adopt the European Union’s sanctions against Russia in 2022 over the war in Ukraine. Singapore, long a haven for the super wealthy, is about to find out.

A recent S$3-billion ($2.2 billion) money-laundering scandal is putting the island-state on the back foot. It’s forcing the government to ask if the sharp influx of new money is too hot to handle.

Call it Singapore-washing. Chinese companies have been moving to the Southeast Asian nation to sidestep US-China geopolitical tensions. Some are also running away from President Xi Jinping’s “common prosperity” drive. Between 2019, when this trend started to pick up, and 2022, direct investment from China grew by more than one-third. Fast-fashion e-commerce unicorn Shein Group Ltd., aiming to go public at an above $60-billion valuation, is now headquartered in Singapore. So is Hillhouse Investment, best known for backing some of China’s biggest tech startups.

It’s been a boon for Singapore, especially the banks. In 2022 alone, the country attracted S$435 billion in new money, or about 70% of its gross domestic product. DBS Group Holdings Ltd.’s private banking franchise, for instance, is flourishing. In the first quarter, its fee income rose 23% year on year to a record S$1 billion, led by a 47% increase in wealth management fees. Its shares have risen by a third over the last year, outperforming Hong Kong-listed HSBC Holdings Plc.

After the global financial crisis, stringent capital requirements have made wealth management — till then a sleepy backwater — a bank’s crown jewel. Managing money for the rich doesn’t come with the typical credit or market risks associated with investment banking.

The one risk involved, though, is reputation. Unlike the 1MDB scandal, which got Goldman Sachs Group, Inc. into trouble, this time, the entire Singapore brand — its private banking industry as well as money-laundering regulations — is being judged. After all, a full suite of banks, not just one or two, got caught up in the recent case. A group originally from China laundered billions of dollars in proceeds from online gambling through more than a dozen banks in Singapore.

With its image at stake, Singapore is now ramping up scrutiny of family offices — a broad, opaque, unregulated subset space of private wealth. It’s also nudging banks to step up due diligence to avoid exposure to illicit flows. In April, the central bank launched a new digital information sharing system, allowing financial institutions to share client data and raise red flags.

These days, launching family offices with tax exemptions is taking a lot longer in Singapore. So is opening private banking accounts. Chinese that carry “golden” passports from countries including Turkey and Saint Kitts and Nevis in the Caribbean are seen as warning signs.

Singapore-washing is just a new iteration of an old problem — the city was once referred to as Indonesia’s money laundromat. Wealthy Southeast Asians, some with questionable connections, parked their money there. Singapore-based entities at one point were the third-largest source of weapons materials to the Myanmar military. But it has taken new Chinese money to put the issue in the international spotlight. After all, China is much bigger. The sheer scale and speed of fund flows from there force Singapore to address weaknesses in its financial system.

To be sure, as a small, open economy, Singapore is structurally exposed to money laundering, especially if it wants to develop wealth management. In 2022, it had S$4.9 trillion of assets under management, many times over its GDP. Only 24% of these funds were sourced domestically, and 88% were invested into assets outside of Singapore. The question is how much the government wants to examine the money that comes in and goes out. More scrutiny would set back the growth of its banks.

Being a glitzy global financial center has a lot of appeal. Prestige aside, a booming banking industry boosts employment, the local economy, as well as real estate values. But then compliance is also a big headache. Dubai has decided to welcome all shades of gray, making itself a playground for crypto and Russian billionaires. Singapore, it turns out, still cares about its reputation. Singapore-washing has finally hit a wall.

BLOOMBERG OPINION

Dutch lender ING targets annual income growth of 4-5% from 2024 to 2027

ING is targeting total income growth of between 4% and 5% per year in 2024 to 2027, the largest Dutch lender by assets said in a statement on Monday ahead of its capital markets day event.

The group, which has a market capitalization of €52.8 billion ($56.51 billion), said it is also aiming for fee income of €5 billion and a return on equity of 14% over the same period.

ING, whose operating arm ING Bank provides banking services in more than 40 countries, said it would continue focusing on expanding its retail business. It aims to have risk-weighted assets (RWA) in the sector of 50% to 55% by 2027. The group added it would prioritize local scale in retail banking and build wholesale banking as a separate pillar.

In the first quarter, ING saw an income increase from its retail banking unit, boosted by higher fee income for both daily banking and investment products.

The bank announced it aimed to deliver €1 billion of additional fee income by 2027, notably through growing its customer base.

ING said it expects the inflationary impact to exceed headline inflation due to delayed effects of collective labor agreements. Regulatory costs in 2025 are expected to be flat compared with 2024 and, as of 2026, to grow in line with deposit volumes. — Reuters

Overseas Filipinos’ Cash Remittances

CASH REMITTANCES from overseas Filipino workers (OFWs) rose by 3.1% year on year in April, the Bangko Sentral ng Pilipinas (BSP) said on Monday. Read the full story.

Overseas Filipinos’ Cash Remittances

US judge blocks Biden protections for LGBT students in four states

CHANDLERVID85-FREEPIK

A FEDERAL judge in Louisiana on Thursday blocked President Joseph R. Biden’s administration from enforcing in four states a new rule that protects LGBT students from discrimination based on their gender identity in schools and colleges. US District Judge Terry Doughty in Monroe issued a preliminary injunction barring a US Department of Education rule that extended sex discrimination protections under Title IX to LGBT students from taking effect in the Republican-led states of Louisiana, Mississippi, Montana and Idaho.

Those states had argued that unless the rule was blocked, schools would be required to allow transgender students to use restrooms and locker rooms conforming to their gender identities.

“Enacting the changes in the final rule would subvert the original purpose of Title IX: protecting biological females from discrimination,” Mr. Doughty, an appointee of Republican former President Donald Trump, wrote.

The ruling was the first by a judge blocking the rule, which had been challenged in nine lawsuits by Republican-led states and conservative activists who argue it amounts to an unlawful rewrite by the Democratic president’s administration of a law designed to protect women from discrimination in education.

“This is a big win for women’s rights,” Montana Attorney General Austin Knudsen, a Republican, said in a statement. “This decision will keep young women and girls protected from dangerous situations, just as Title IX has done for decades.”

An Education Department spokesperson said it is reviewing the ruling but stands by the rule, which takes effect Aug. 1, saying it “crafted the final Title IX regulations following a rigorous process to realize the Title IX statutory guarantee.”

The department in issuing the rule in April said it clarified that the prohibition against sex-based discrimination in schools and colleges that receive federal funding contained in Title IX of the Education Amendments of 1972 also includes discrimination based on sexual orientation and gender identity.

The department cited a 2020 US Supreme Court decision holding that a ban against sex discrimination in the workplace contained in a different law, Title VII, covered gay and transgender workers.

Courts often rely on interpretations of Title VII when analyzing Title IX as both laws bar discrimination on the basis of sex.

But Mr. Doughty agreed with the Republican state attorneys general of Louisiana, Mississippi, Montana and Idaho that the rule was “inconsistent with the text, structure, and purpose of Title IX.”

Mr. Doughty said the rule would require schools to use whatever pronouns a student preferred and allow them to access bathrooms and locker rooms based on their gender identity, an issue of political significance the agency lacked authority to address.

He said it also ran afoul of the US Constitution’s Spending Clause by containing ambiguous conditions and violating other constitutional provisions, including the First Amendment’s protections for free speech and the free exercise of religion. — Reuters

Fans, peers instrumental to influencer success

STOCK PHOTO | Image by Alexandra_Koch from Pixabay

Content creation may typically be a “one-man show,” but fans and followers contribute a lot to the success of influencers online, Eplayment CEO and President Karlos R. Naidas said in a media roundtable last Thursday, June 13 

“It’s your fellow creators and your followers and fans that help you reach your goals in this industry,” he shared. 

According to the fintech solutions company, an additional 1.8 million users were now connected to the internet in 2024, generating 86.98 million users logged in on social media platforms in the Philippines. 

Mr. Naidas affirmed that as more people become more inspired to participate or take part in the world of content creation, it also contributes to amassing the numbers and cultivating the creator economy. 

“The creator economy encompasses everything within the world of e-commerce and social media, from influencers to brands, to digital advertising and marketing firms,” the fintech company stated in their press release.

 

Parasocial relationship

As the industry continues to grow, consumers become more exposed to the content of the social media influencers they follow. It establishes the relationship between the creator and its fans, Ticker mentioned in an article in 2023. 

“The constant influx of content allows the consumer to project feelings of companionship, admiration, and reverence even as the creator has no idea who they are,” the student-led publication wrote.  

Further, it defined parasocial relationships as one-sided bonds between online performers and their audiences that establish a sense that the viewer knows the creator.  

“These relationships have become much more popular in the digital age since people constantly compare themselves or watch social media influencers. It’s inevitable to develop positive feelings toward the content creators people watch,” it elaborated. – Almira Louise. S. Martinez

PSEi may move sideways in absence of leads

The lobby of the Philippine Stock Exchange in Taguig City, Sept. 30, 2020. — REUTERS

PHILIPPINE SHARES could move sideways this week on expectations of bargain hunting as investors look ahead to the Bangko Sentral ng Pilipinas’ (BSP) next policy review and with the peso’s continued weakness causing the market to stay cautious.

The Philippine Stock Exchange index (PSEi) went down by 0.11% or 7.13 points to close at 6,383.70 on Friday, while the broader all shares index rose by 0.13% or 4.75 points to end at 3,447.75.

Philippine financial markets were closed on Monday (June 17) in observance of Eid’l Adha or the Feast of Sacrifice.

“Unless we see positive developments on the outlook of our interest rates, the local market may only move sideways with bargain hunting providing the upside force. Downside risks including the less dovish outlook of the Federal Reserve and the sustained weakness of the peso may continue to weigh on market sentiment,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

“Last week’s four-day decline is seen to have opened the door for bargain hunting opportunities. However, the optimism needed for the market to rally is not yet seen. Investors are still waiting for positive catalysts, primarily one which would hint of monetary policy easing soon in the Philippines,” Mr. Tantiangco added.

The market could test the 6,400 level this week, he said.

“If it fails to get back above the said line, the market’s new trading range moving forward is seen from 6,150 to 6,400,” he added.

The Monetary Board will hold its next policy review on June 27.

The BSP will probably cut its policy rate after the US Federal Reserve, which has signaled it may start easing as late as December, the Finance chief said on Thursday.

Asked if the BSP would begin its easing cycle once the US central bank cuts rates, Mr. Recto said this was “highly probable.”

The Monetary Board has kept its benchmark rate steady at a 17-year high of 6.5% since October 2023 following cumulative hikes worth 450 basis points (bps) to bring down inflation.

BSP Governor Eli M. Remolona, Jr. has said that the earliest the central bank can begin cutting rates is in August, with a total of 25-50 bps in easing likely this year.

Mr. Remolona earlier said the BSP does not need to wait for the Fed to begin its own easing cycle.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort put the PSEi’s major support at 6,360 and major resistance at 6,560-6,610.

Online brokerage 2TradeAsia.com said in a note that the market’s immediate support is at 6,200-6,250, while resistance is at 6,500.

“There could be a technical correction from [last] week’s low if and when the Fed shifts to a dovish tone given gathering weakness among several inflation-linked economic indicators, such as jobless claims and producer price index,” First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message. — R.M.D. Ochave with Reuters

2025 considered critical year for offshore wind port funding

THE Department of Energy (DoE) said funding to make ports ready for the offshore wind industry needs to be budgeted for in the 2025 spending plan to enable power generation by 2028.

“The critical year here is that by 2025, funding should be included in the General Appropriations Act for at least two or three government ports in order for us to realize the first power from offshore wind by 2028,” Energy Undersecretary Giovanni Carlo J. Bacordo told BusinessWorld on the sidelines of a forum last week.

Offshore windfarms need to be serviced from specialized ports hosting maintenance facilities and enabling equipment transport.

“We are working closely with the Philippine Ports Authority as we are the ones highlighting that these ports are needed for offshore wind,” Mr. Bacordo said.

He said a pre-feasibility study of 10 ports is being carried out with technical assistance from the Asian Development Bank.

These ports include Bulalacao, Oriental Mindoro; Culasi, Capiz; Tabaco, Albay; and Pulupandan and San Carlos, both in Negros Occidental.

The others are the Energy Supply Base port facility of Philippine National Oil Co. in Batangas; Bauan International Port, Inc., Batangas; Subic; Iloilo Commercial Port Complex; and Port of Irene, Cagayan.

Mr. Bacordo said that the results of the pre-feasibility study into the first five ports will be available by August while the rest will be out by October.

“Kapag lumabas na ’yun (When that comes out), then we will see more investors coming in. Kasi ngayon, malalaman (As we will know) what ports are feasible to proceed to the full FS (feasibility study) or for the full detailed engineering design,” he said.

He said seven more ports have been nominated to the Economic Development Group for possible feasibility study.

The DoE hopes to stage a Green Energy Auction specific to offshore wind in the first half of 2025, Mr. Bacordo said.

The DoE has awarded 91 offshore wind energy service contracts with a potential capacity of 65.12 gigawatts (GW).

Under the Philippine Offshore Wind Roadmap, the Philippines has a potential capacity of about 63 GW from tapping offshore wind resources.

The Philippines has set a target of increasing the share of renewables in the energy mix to 35% by 2030 and 50% by 2040.

Separately, the Philippines is deemed to have adequate facilities to support liquefied natural gas (LNG) shipments for its power plants, according to the Energy Secretary.

“We just want to emphasize that the existing receiving and regasification facilities are actually adequate for purposes of supporting up to 8,000 megawatts capacity of LNG power plants,” Energy Secretary Raphael P.M. Lotilla said in a virtual briefing on Friday.

“And that’s why we need to look at them and to encourage the companies concerned to look at these two separately owned receiving and regasification facilities as one unit,” he added.

In 2023, the Philippines commissioned its first two LNG import terminals in Batangas which are operated by Linseed Field Corp. and FGEN LNG Corp.

“In the future, if it exceeds these levels, then future receiving facilities are also welcome,” Mr. Lotilla said. “But at the moment, of course, we do not want to see an overbuilding of LNG infrastructure because that would impose an additional cost on the entire economy.”

The DoE sees LNG as a suitable transition fuel “by which the private sector investments in this technology will be facilitated as a way to enable the viability of large renewable energy capacity additions and ensure reliability and security of the power system.” — Sheldeen Joy Talavera

No need to cut growth targets, but gov’t should raise revenue — analysts

PHILIPPINE STAR/EDD GUMBAN

THE Development Budget Coordination Committee (DBCC) does not need to scale back its growth targets for this year, but must consider how to raise revenue, and perhaps shed its reluctance to introduce new taxes, analysts said.

“We don’t think there is any need to revise the DBCC growth target,” Aris D. Dacanay, economist for ASEAN (Association of Southeast Asian Nations) at HSBC Global Research, said in an e-mail.

“Our 2024 growth forecast is just a bit lower at 5.8%, and with reforms such as the rice tariff rate cut potentially boosting consumption in the Philippines, the possibility for the economy to reach the lower end of the target isn’t zero.”

Economic managers have yet to announce whether they will revise fiscal targets for this year. In April, the DBCC cut its gross domestic product (GDP) growth target to 6-7% from 6.5-7.5%, backed by concerns over geopolitical instability and trade disruptions.

Mr. Dacanay also noted that the government’s public-to-GDP ratio is expected to fall as the government continues to pay down debt incurred during the coronavirus pandemic.

“What is important to monitor is the direction public debt-to-GDP is going. And despite high fiscal deficits until 2028, public debt-to-GDP is still expected to fall since a big portion of the deficit will be used to pay for the debt incurred during the pandemic (which reduces overall debt).”

The National Government’s debt as a share of GDP fell to 60.2% in the first quarter from 61.1% a year earlier, the Treasury bureau reported. However, this is still above the 60% threshold that multilateral institutions deem manageable for developing economies.

The government’s debt-to-GDP ratio target for this year is 60.3%, with an ultimate goal of 55.9% by 2028, when the current government steps down.

While Mr. Dacanay said there is no urgency to impose new taxes to broaden fiscal space, “any additional revenue from well-designed tax measures will always be good for the economy.”

“For instance, implementing the digital tax will help level the playing field for enterprises who are not doing business in the digital space.”

The Department of Finance (DoF) has said it is not planning to impose new taxes, and will instead push for nontax revenue in its fiscal consolidation plan.

The DoF reported that nontax revenue hit P206.4 billion as of April.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the government must focus on “intensified” tax collection and encourage greater tax compliance by the public to generate sufficient revenue to fund development priorities.

“However… there may be a need to increase tax rates and introduce new taxes, though signaled as a final resort/option, especially if inflation eases/stabilizes further in the coming months,” he said via Messenger chat.

Filomeno S. Sta. Ana III, coordinator at Action for Economic Reforms, said the government should introduce new tax measures while maintaining adequate spending.

“A sound fiscal consolidation plan will necessarily include generation of higher revenue,” he said in a Viber message.

“Cutting spending is one approach but we can only cut the wasteful spending; otherwise, an austerity program will hurt the whole economy and society.”

Proper tax administration is also deemed insufficient to generate the necessary revenue.

“Hence, government has to identify new taxes which are efficient and politically feasible… the point is, government should not reject tax policy as a main strategy for fiscal consolidation,” Mr. Sta. Ana said.

Tax measures that policymakers should consider include increasing rates for sin products like alcoholic drinks and vapes, as well as inflation-adjusted rates for sweetened beverages.

Mr. Sta. Ana also cited the need to reform the pension system for military and uniform personnel and rationalize value-added tax by limiting exemptions to essential goods.

The government must also ramp up spending on state programs in infrastructure, healthcare, disaster risk reduction, and the green energy transition to reach its fiscal targets, he added. — Beatriz Marie D. Cruz

FTA with Europe seen as hedge against deteriorating China ties

Hungary’s Minister of Foreign Affairs Péter Szijjártó — REUTERS

ACCELERATING free trade talks with the European Union (EU) will help the Philippines diversify its trade options away from China as tensions escalate in the South China Sea, economists said.

“Access to the EU market will result in increased trade diversification away from China,” Calixto V. Chikiamco, Foundation for Economic Freedom president, said in a Viber message.

“This (free trade agreement) is very crucial especially if we reach middle-income status and lose our GSP+ privileges to the EU,” he added, referring to the preferential trade scheme the EU makes available only to developing countries.

Hungary, which will assume the EU presidency next month, plans to hold multiple rounds of free trade negotiations that do not consider political issues, Hungary’s Minister of Foreign Affairs Péter Szijjártó told a news briefing last week in Makati.

During his visit, Mr. Szijjártó said Hungary is aware that the Philippines is working under time pressure before its Generalized Scheme of Preferences (GSP+) privileges expire in 2027.

The GSP+ scheme, which requires the Philippines to uphold commitments to 27 international conventions on human rights, labor rights, good governance, and climate action, was extended until 2027. 

Last month, Trade Secretary Alfredo E. Pascual said he expects free trade talks with the EU to finish before 2027.

“Diversification towards other economies will be a continuing challenge, as China remains the country’s top trading partner, and for Europe to fill a possible future gap in trade with China, our trade with the EU should double,” Terry L. Ridon, a public investment analyst and convenor of InfraWatch PH, said via Messenger chat.

Tradeline Philippines estimates total trade between the Philippines and China at $40.3 billion last year, up 2.9%.

Leonardo A. Lanzona, who teaches economics at the Ateneo de Manila, said the Philippines must ensure labor standards are upheld in finalizing the EU trade deal, citing the regional bloc’s strict adherence to global labor market standards.

“The EU would not wish to trade with partners at the expense of worker welfare,” he said via chat.

Jose Enrique A. Africa, executive director of the IBON Foundation think tank, said the Philippines should develop domestic industries before pursuing trade agreements.

“Lack of active government support for Filipino farmers and industry and opening up with FTAs has driven manufacturing to its smallest share of gross domestic product in 75 years and agriculture to its smallest share in history,” he said via Viber.

“An EU-Philippines FTA will most of all benefit the global supply chains of industrial powers — as it is, most Philippine exports to the EU aren’t even Filipino-made and are made by foreign firms in domestic export enclaves — preventing us further from developing Filipino industry.”

China was the Philippines’ largest source of imported goods, valued at $2.27 billion in March, or 24% of the total, according to the Philippine Statistics Authority. Exports to China amounted to $837.51 million, or 13.7% of the total.

Tensions between the Philippines and China have worsened in the past year as Beijing continues to block resupply missions to Second Thomas Shoal, where Manila grounded a World War II-era ship in 1999 to serve as an outpost and assert its sovereignty.

China claims almost all of the vital waterway, including parts claimed by the Philippines, Brunei, Malaysia, Taiwan and Vietnam. A United Nations-backed tribunal based in the Hague in 2016 rejected China’s claims.

“Mechanically pursuing free trade was counterproductive before but especially in today’s conditions of rapidly eroding multilateralism and a slowing global economy. It’s dogmatic and reckless to deny changed global conditions,” Mr. Africa said. — John Victor D. Ordoñez

PHL fruit competitiveness may be key to expanding agri exports

FRUTAS DELIVERY FACEBOOK PAGE

THE GOVERNMENT should focus on expanding production of crops where it enjoys a competitive advantage, such as fruit, to boost agricultural exports, analysts said.

“There is evidence that we are competitive in certain products, particularly fruit,” Ateneo de Manila economics professor Leonardo A. Lanzona said in a Messenger chat.

He added that the government’s role is to facilitate these growers’ expansion to achieve adequate scale to service export markets.

Agricultural exports rose 10.7% to $1.72 billion during the first quarter, according to the Philippine Statistics Authority.

Fermin D. Adriano, former Agriculture Undersecretary for Policy, Planning, and Research, said despite the expansion during the previous quarter, production for exportable farm goods is still facing funding constraints.

“The agri budget provides inadequate support as 60% of (the Department of Agriculture’s) funding goes to supporting rice,” Mr. Adriano said via Viber.

Leading farm exports during the period were edible fruit and nuts, as well as peel of citrus fruit and melons, valued at $517.96 million or 30.1% of the total.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said improved foreign ties may have contributed to the increase in exports.

“Diversifying further to more export markets, as well as more free trade agreements (FTAs) with more countries on top of the (Regional Comprehensive Economic Partnership) and the South Korea-Philippines FTA will help boost (exports),” Mr. Ricafort said via Viber.

RCEP involves the Association of Southeast Asian Nations, China, Japan, South Korea, New Zealand, and Australia. It took effect in June last year.

It allows minimal to zero restrictions in terms of quantities and seeks to minimize import taxes.

Mr. Lanzona said the Philippines continues to show a deficit in agricultural trade due to its reliance on imports.

The deficit in agricultural trade narrowed to 6.5% during the first quarter, with an increase in exports offsetting a 0.3% decline in imports.

“This suggests we continue to struggle because the economy continues to be import dependent in food products,” he added.

The DA had said that it is seeking to improve agricultural exports, especially tropical fruit like banana, mango, and pineapple.

In January, the DA said it is preparing a Philippine Agricultural Export Development Plan. — Adrian H. Halili

1...1,6401,6411,642...12,795Page 1,641 of 12,795
© 2024 BusinessWorld Publishing.
All rights reserved.
Read our privacy guidelines
Facebook Instagram Linkedin Twitter Youtube