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Skills Development in IT-BPM Sector: On the need for calculus

WIRESTOCK-FREEPIK

(Part 5)

With the advent of more advanced technologies such as Artificial Intelligence, the Internet-of-Things (IoT), robotics, and Big Data, it is imperative that more and more of the products of our basic education schools (K to 12) should attain global competitive levels in their reading, mathematics and science (STEM) capabilities. This would require a significant improvement in the amount the public sector invests in public education. The target should be for the resources invested by the Government in public education to match the average spent by our ASEAN peers, about 6% of GDP. There should be a special effort to improve the K to 12 curricula to include the teaching of differential and integral calculus at the senior high school level. The new technologies would require mathematical knowledge at those higher levels. The earlier the cream of the crop among our youth are exposed to higher math subjects, the more they will be attracted to the college or university programs that will prepare them for the advanced technologies.

At the college level, there should be a special effort to increase enrollment in the engineering and sciences specializations because that would automatically guarantee that these students would be taking courses in those higher branches of mathematics. There should also be a special effort to require university students majoring in business, accounting, and management to take at least two semesters combining analytic geometry and calculus. Today, anyone who purports to be a businessman or manager should be considered ill-equipped if he or she does not have at least an elementary understanding of the calculus. Gone are the days when the only quantitative skill that accountants needed was how to add and subtract, multiply and divide. This was actually my case when I majored in Accounting to be able to take the CPA exam. I didn’t have a clue what calculus was all about. That vacuum in my math education gave me a serious handicap when I started my doctoral studies at Harvard. I had to take a crash course in analytic geometry and calculus. As any student in a graduate program in economics knows, he has to learn more higher mathematics than some engineering students, some of whom need not take courses on differential equations, linear programming, and matrix algebra.

Today, those studying to be accountants, together with their other colleagues in business administration or management courses, must have a minimum knowledge of the uses of linear programming and operation re-search, for example. That is the only way they can more easily understand the implications of artificial intelligence, algorithms, blockchains, input-out analysis and other terms becoming commonplace in business parlance. In this regard, I always looked up to those who studied Management Engineering at the Ateneo during the last three decades of the last century. They were actually majoring neither in management nor engineering but in high-level math. The products of this course are some of the CEOs and top managers of the large corporations today. They, like former Secretary of Trade and Industry Greg Domingo, are now the gurus of Big Data and Artificial Intelligence.

Having said all this, however, let me once again remind everyone that the vast majority of those who will be working in the information technology and business process management (IT-BPM) sector in the next 10 years or so need not pursue a degree program in college.

As the Roadmap 2022 concluded rightly, the IT-BPM sector is unique in the sense that for entry-level positions, educational background is not a key factor in the selection process. In this context, the IT-BPM sector offers many employment opportunities to those interested in working in the sector and who can meet entry requirements. For example, contact center positions are open to anyone with basic skills; the game development and animation subsector is open to those with an interest (not necessarily possessing a digital arts degree). I distinctly remember the owner of an animation enterprise that supplies some Japanese companies with the anime drawings they needed proudly proclaiming in a workshop on creative industries that none of his 100 workers have a college degree.

In formulating skills development programs for the IT-BPM sector for the immediate future, i.e., the next five years, we must keep in mind that of the 2.5 million workers projected to be employed by 2028, the vast majority do not need college degrees. Most of them will be taken from the existing 1.7 million workers who will be upskilled, reskilled, and retooled by the IT-BPO enterprises through in-house training programs or through partnerships with academic institutions (both universities and Technical Education and Skills Development Authority (TESDA)-type technical schools). For the additional 800,000, they can be recruited from some of the millions of workers who are either underemployed or unemployed (there are more than 10 million of them in the existing labor force) and provided with short courses that reskill them in the old technologies that have been around for the last two decades.

Key services that have been offered for some time and will not be completely made obsolete by the new technologies are:

  1.  Contact center and Business Process Outsourcing (BPO). In this sub-sector, the mature areas and are the easiest to replace with AI and robots are customer care and helpdesk. Still growing are Engineering Service Out-sourcing or ESO, Data Analytics, Performance Management, and Legal Process Outsourcing;
  2.  IT Services. The mature areas are application development and infrastructure support. The growth areas are System Integration, Automation Enablement, IoT Enablement, Languages, and Application Development Management (ADM);
  3. Health Information Management Services: mature services are the payer services while the growth ones are preventive health, remote healthcare management, and provider services;
  4. Animation and Game Development services: the mature areas are 2D Animation and Game Development while still growing are 3D Animation, augmented and virtual reality or AR/VR, and Gamification;
  5. Global In-House Centers: the mature services are Finance and Accounting while the growth services are industry-specific services for telecom, healthcare, insurance, and pharmaceutical.

For those who are already in the workforce or about to finish their studies in a wide range of educational or training programs, the opportunities are still in the traditional sectors. For the rest of this decade, the country will continue to be a key offshore player for customer care services and support, competing mainly with India. Application development and maintenance (ADM) will continue to be provided by both large service providers, as well as mid-size to small companies. There will continue to exist opportunities for mid-tier service providers to obtain smaller and less-complex contracts from both foreign and local small- to medium-size enterprises.

As Finance and Accounting (F&A) faces a shrinking market, Human Resources (HR) services have begun to expand on the back of an increasing focus from large service providers. There is also a steady growth in the maturity and value of knowledge process outsourcing or KPO, ESO, and legal and analytics services being offered.

As regards healthcare, the Philippines has been focusing more on higher value services on both the provider and payer side. The payer market is much larger in terms of revenue because of the former being large, multi-year contracts serviced by large BPO customers. As regards animation and game development, the Philippines needs to leverage new platforms such as the mobile and web to grow at a faster rate compared to the other service sectors of the market.

 

Bernardo M. Villegas has a Ph.D. in Economics from Harvard, is professor emeritus at the University of Asia and the Pacific, and a visiting professor at the IESE Business School in Barcelona, Spain. He was a member of the 1986 Constitutional Commission.

bernardo.villegas@uap.asia

EastWest Bank looking to sustain double-digit growth in net income

PHILSTAR FILE PHOTO

EAST WEST Banking Corp. (EastWest Bank) hopes to achieve double-digit net profit growth this year as it expects its net interest margin to widen once the Bangko Sentral ng Pilipinas (BSP) begins its easing cycle, driven by its consumer-heavy loan portfolio, its top official said.

The bank is hoping to sustain the double-digit income growth it posted last year, EastWest Bank Chief Executive Officer Jerry G. Ngo told reporters on the sidelines of the BusinessWorld Economic Forum last week.

The bank saw its net profit rise by 32% year on year to P6.1 billion in 2023.

In the first quarter, EastWest Bank’s attributable net income grew by 7.74% to P1.7 billion, driven by the expansion of its consumer lending business and its digital initiatives.

“I think that (consumer business) will still be the main driver of the business. We’re basically focusing on the consumer lending side. It’s not just a tagline. For us, it’s really important and it’s really very critical. It’s also what sets us apart. Our portfolio is really different. The profile is very different from the rest of the market. So, we want to continue with that,” Mr. Ngo told reporters on the sidelines of the BusinessWorld Economic Forum held last week.

“What we do is we have loans that are fixed. As interest rates go up, our margins are increasing. But as interest rates go down because of the rate cut, that creates liquidity. So, our margins will open. So, interestingly, it’s going to be positive for us,” he said.

He added that the BSP’s easing cycle will likely be dependent on the US Federal Reserve’s actions.

“I think what’s more important is whether they will continue to cut or they will keep it persistently high,” he said, adding that borrowing costs will likely still be elevated despite the expected cuts.

Mr. Ngo said they remain bullish on credit growth in general as the country’s employment has been robust, supported by the online businesses born during the pandemic.

“We don’t see it because it’s not properly captured in national statistics, but the reality is it’s creating an informal economy. So, we want to be able to look at this whole thing holistically. So far, so good. We’re growing both on the secured side as well as on the unsecured side,” he said.

He added that the bank will adjust its products in line with consumers’ shift in preferences, specifically the growing interest in travel.

“I think what’s happening is that the traditional banks like ourselves really need to invest more. You’ve seen it happen in other markets… It’s probably because of interest rates. It’s hard to get expensive deposits. And then in order to make money, you have to lend it at a much higher credit cost. In which case, you’re taking so much risk. And if you don’t have an ability to collect, then it’s hard. So, that’s why we think that there’s an opportunity for a what they call a traditional bank that is digitally enabled that supports and embraces all of those capabilities, to really level up, as they say,” Mr. Ngo said.

“Obviously, we’re going to have to invest more in order to have a higher growth trajectory. So, that’s the balance that we need to keep. We need to keep our investors happy. As I mentioned earlier, there’s a lot of people, particularly in the investment community, that are looking for profitability. They need returns,” he added.

EastWest Bank is looking to make its digital wallet app Komo available to more types of clients by integrating it into EasyWay, its digital banking app, Mr. Ngo said.

“What you want to be able to do is to get people to use the e-wallet like what you have in your pockets day to day — small amounts, more transactional as a wallet. The ones that you want to do — investments, insurance, and other longer-term transactions — you do it in the bank… That allows for protection. You do not carry your entire wealth every day in a wallet, because otherwise, you will have a problem,” he said.

To boost its profits, the bank is also tapping the affluent market and the micro, small, and medium enterprises market, he added.

EastWest Bank will also expand its services and branches to areas outside of Metro Manila, he said.

“We will let our customers lead. We will work with our customers, but we will focus on a very defined strategy,” Mr. Ngo said.

EastWest Bank’s shares closed at P9.24 apiece on Tuesday, up by four centavos or 0.43% from the previous day’s finish. — AMCS

Arts & Culture (05/29/24)

CCP Main Building lights up for Independence Day

TO HERALD the upcoming Philippine Independence Day celebrations, the Cultural Center of the Philippines (CCP) has lit up its Main Building with the colors of the national flag. Using conventional ellipsoidal lighting fixtures with gobos patterned after islands and geographical features of the Philippines, it marks the 126th anniversary of the nation’s independence. The façade lighting runs every night, from 6 to 9 p.m., until June 16.

Aliwan Fiesta returns

ALIWAN FIESTA, the celebration of Filipino festivals and heritage, returns to the Cultural Center of the Philippines (CCP) Complex in Pasay City from June 27 to 29. Aliwan Fiesta 2024 kicks off on June 27 with the Tugtog ng Aliwan Competition at 5 p.m., followed by the Pasakalye Concert at 7 pm. The concert will feature a star-studded line-up of Filipino artists, setting the tone for the festival experience. On June 28, the Reyna ng Aliwan pageant will see beauty queens from across the Philippines vie to showcase the unique charm of their respective regions. Aliwan Fiesta 2024 culminates on June 29, 5 p.m., with the Grand Parade, featuring the Streetdance and Float Competitions. The parade will start at the intersection of Jalandoni St. and V. Sotto St., proceed along P. Bukaneg St. in front of the CCP, turn onto Roxas Blvd., and culminate in front of the Aliw Theater, where contingents will perform six-minute routines. The best of the best will be selected in an award ceremony at 9 p.m.

Karla Sajona holds 3rd solo exhibit

IN her third solo exhibit, “Flights of Fancy,” Karla Sajona transitions from her usual realistic works to rather abstract and ethereal renditions of birds. Inspired by her fascination for Asian kite toys and celestial themes, the exhibit includes prismatic colored patterns in works like Iridescence and Plumage, which depict sunbirds, hornbills, kingfishers, and roosters. “Flights of Fancy” runs until May 31 at the Gateway Gallery Small Room in Gateway Mall, Araneta City, Quezon City.

CCP Met: Live in HD brings Malcolm X biopic opera

HAILED as groundbreaking for its all-Black production team, Anthony Davis’ X: The Life and Times of Malcolm X depicts the controversial figure in the civil rights movement and the fight for Black empowerment in the 1960s. This opera shows Malcolm’s transformation from a victim of poverty to leader to martyr. Now part of the Cultural Center of the Philippines’ The Met: LIVE in HD series, the biopic of the civil rights icon was put together by jazz composer Anthony Davis. With a runtime of three hours and 42 minutes, it presents vignettes from the life of Malcolm X, played by Will Liverman. It will be shown on June 4, 5:30 p.m., at the cinema in Greenbelt 3, Makati City.

Uy, Madlangsakay Jr. show at MO_Space

THIS June, two artists will be showcased at MO_Space. One is Miguel Lorenzo Uy, whose exhibition “TBD” presents a new iteration of his ongoing project photo-documenting and manipulating the architecture of different commercial and high-rise buildings. For this body of work, the images are from the surrounding area where the exhibition takes place, manipulated to look like parts of a massive spaceship. Meanwhile, Efren Madlangsakay, Jr.’s “Printed in Water | Drawn in Trees” centers on flattened and abstracted landscapes that portray bodies of water, dense foliage, scattered liquid and vegetation, and negative space. Both shows are open for public viewing from June 1 to 30 at the third floor of MOs Design, Bonifacio High Street cor. 9th Ave., Bonifacio Global City, Taguig City.

Two Olazos exhibit at BenCab Museum

FOR June, two artists will be displaying their works at the BenCab Museum in Baguio. Jonathan Olazo’s “There was nowhere to go but everywhere, so just keep on rolling under the stars” shall take up the space of Gallery Indigo. Meanwhile, Romulo Olazo’s “Nudes: The Secret Body of Abstraction” is set to occupy the Sepia Gallery. The exhibit centers on his depictions of the female figure, shown in different angles, with different mediums, and different qualities of rendering. The two exhibits run from June 8 to July 7 at the BenCab Museum, Km 6 Asin Road, Tuba, Baguio City.

La Union produces inventory of cultural elements

THE PROVINCIAL government of La Union recently produced its own inventory of cultural elements that are found in the province, as part of its objectives to promote heritage preservation. This was the result of the province’s Cultural Mapping Program in April, done with the technical assistance of the National Commission for Culture and the Arts. La Union is the first province in Region 1 to complete the program, resulting in a total of 359 cultural elements that are now part of the inventory. Of these, 111 are in the natural heritage domain, 104 are intangible cultural heritage, 71 are tangible movable objects, 46 are immovable heritage, 17 are cultural institutions, and 10 are significant personalities. The program culminates with the printing and reproduction of the inventory, which is set for June to July this year.

Pacquing, Gadia shows at Silverlens Manila

IN MID-JUNE, two artists’ works will take the spotlight at Silverlens Manila. For Bernardo Pacquing, it will be his 5th solo exhibition at the gallery since Silverlens started representing him in 2014. “Causal Loops” is an experiment with abstraction as a building activity where materials are rid of their original meaning and transformed, resulting in a total of 25 works. Meanwhile, Dina Gadia paints from her own photographs in “Land Poetics,” offering an intimate perspective that diverges from her typical sources of books and magazines. The exhibition features seven new paintings on canvas, all rendered in acrylic. Both exhibits will be on view from June 11 to July 13 at Silverlens Manila, 2263 Chino Roces Ave. Ext., Makati City, with an opening reception on June 11 at 4 p.m.

Animated short film Sulayman garners acclaim

FILIPINO animated short film Sulayman, based on a Maguindanao folktale, has bagged awards at two international short film festivals. Created by Tuldok Animation Studios, the eight-minute film won Best Animated Film at the PENSACON Short Film Festival 2024 and Best Animation: Traditional award at the FantaSci Short Film Festival, both held in Florida in the United States. Written and directed by Nelson “Blog” Caliguia, Jr., Sulayman revolves around the sacrifices the heroes make to save the lives of others and is based on the folktale “Indarapatra and Sulayman.”

Magdalena Gamayo birth centennial launch

THE NATIONAL Commission for Culture and the Arts (NCCA) unveiled the Birth Centennial Logo of Manlilikha ng Bayan Magdalena Gamayo, marking the beginning of a 100-day countdown to her birth cetennial. The logo was revealed in her hometown of Pinili, Ilocos Norte, at the GAMABA Cultural Center. The celebration will begin with an online campaign by weavers of the GAMABA Cultural Center and students from the Inabel Weaving Training Program in May. Ms. Gamayo’s inabel works will be turned over to the National Museum of the Philippines – Ilocos on June 24 and there will be an online lecture, “The Inabel Textile Tradition of the Ilocos Region and the Legacy of MB Magdalena Gamayo,” on July 19. The birth centennial celebration will be on Aug. 13, followed by a traveling exhibition of her works across the Philippines next year.

Do more to fight and eliminate cervical cancer

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Cervical cancer is the second most prevalent cancer among women between 15 and 44 years old in the Philippines. Worse, most cases are only diagnosed in the advanced stage. Global Cancer Statistics reported in 2020 that 4,052 women died out of the 7,897 diagnosed with cervical cancer. In the same year, the Philippine Statistics Authority said approximately 38 million women aged 15 years and older were at risk of developing the disease.

What is being done about this?

In 2020, the World Health Organization (WHO) released the Global Strategy to Accelerate the Elimination of Cervical Cancer as a public health problem. The aim is that by 2030, 90% of girls should be fully vaccinated with HPV (Human papillomavirus) vaccine by the age of 15; that 70% of women are screened with a high-performance test by the age of 35 and again by 45; and that 90% of women identified as having cervical disease receive treatment (90% of women with pre-cancer treated, and 90% of women with invasive cancer managed).

Here at home, the government and other stakeholders have spearheaded efforts to reduce and eventually eliminate cervical cancer. We have the Universal Health Care law and the National Integrated Cancer Control Act. However, due to the pandemic and several challenges in the health sector, there is still a need for the country to revitalize and further scale up the implementation of evidence-based and cost-effective interventions.

Thus, despite these efforts, cervical cancer programs in the Philippines have remained inadequate. The main challenge is how to come up with improved financial strategies for cervical cancer programs in the Philippines, as timely diagnosis and treatment, as well as other out-of-pocket expenses, come at a high price for patients and their families.

In an attempt to occasion multisectoral discussion and fresh solutions, the Asia-Pacific (APAC) Women’s Cancer Coalition, in partnership with the Cancer Coalition Philippines (CCPh) and Jhpiego, organized a hybrid town hall discussion entitled “Addressing the Gaps to Cervical Cancer Elimination in the Philippines.” Held on May 17, the forum gathered key stakeholders to discuss evidence-based and cost-effective interventions, as well as get inputs and commitments that will scale up the elimination of cervical cancer in the Philippines and the timely and successful implementation of the global recommendations.

Giving the keynote address was Senator Joseph Victor “JV” Ejercito, the former chair of the Senate Committee on Health and Demography. There is much work to be done, he said, because despite the availability of vaccination against HPV many women continue to suffer and die from this preventable disease.

Department of Health (DoH) Undersecretary Glenn Mathew Baggao committed to explore sustainable funding mechanisms for their programs. “The elimination of cervical cancer is not merely a medical goal; it is a testament to our commitment to the well-being of our Filipinas and the generations to come,” he said.

The first panel discussed the need for a National Elimination Plan for Cervical Cancer. Professor Deborah Bateson, Professor of Practice and Co-Lead of the Cervical Cancer and HPV Stream of The Daffodil Center, told the audience about what is happening in Australia in terms of primary and secondary prevention of the disease. The country has a national HPV vaccination program and a national cervical screening program, as well as a national cancer screening register. Australia is on track to be one of the first countries in the world to eliminate cervical cancer by 2035.

The Cancer Control Division Chief of the DoH, Dr. Jan Aura Laurelle Llevado, stressed the need for the department to decide on strategies. There are many practical questions that must be resolved, she said: should all nine-to-14-year-olds be vaccinated, and does the government have the money and capacity? Do we have the right demand generation and social mobilization? When do we shift to the actual implementation of HPV DNA testing?

Roche Diagnostics’ country manager, Marco Valencia Sanchez, who is also the president of the Health Technology Association of the Philippines, highlighted multiple problems in our geographies. “The private-public partnerships together can tackle it right and it goes from the National Government through LGUs.”

Panel 2 tackled improving financing strategies. PhilHealth’s Senior Vice-President, Renato Limsiaco, Jr., said sharing of information is an important component for them. The target for the year 2028 is 27% contribution from the total healthcare expenditures. In 2022, the figure was only at 13.6%. Dr. Maria Julieta Germar of the Health Technology Assessment Council said they ensure that the appraisal process responds to the priority healthcare needs of the country. The Department of Budget and Management’s Undersecretary, Wilford Will Wong, said that to be able to allocate resources for a program, they rely on the submissions of the primary agency concerned.

What was clear during the forum was that mechanisms are already in place for the country to help Filipinas suffering from cervical cancer. The strategies and programs have been identified. However, for all these to materialize and for the objectives to be met, there need to be sustainable sources of funding that would complement allocations made by the government, which also has a lot of other responsibilities and priorities.

It has been an established fact that cervical cancer is preventable and curable. This is the time to make use of collaboration with various firms and organizations that are driven by these collective goals — to improve the quality of life of those living with cervical cancer, to boost the capacity for early detection and treatment, and to eventually eliminate cervical cancer.

 

Victor Andres “Dindo” C. Manhit is the president of the Stratbase ADR Institute.

Local paper producer helps PHL clients use eco-friendly packaging

PRESTIGE PAPER PRODUCTS FB ACCOUNT

PRESTIGE Paper Products is helping other Philippine companies to commit to their sustainable initiatives by supplying them with eco-friendly paper materials.

“We’ve been seeing a shift among brands to more sustainable materials,” Lea Marie Ayeng, chief executive officer at the small and medium enterprise, said in a video interview.

This is due to legislation such as the Extended Producer’s Responsibility (EPR) Act and brands being pressured by their global counterparts to look into materials with a lower environmental footprint.

The EPR Act, which lapsed into law in 2022, requires big companies with assets worth more than P100 million to be environmentally responsible throughout the life cycle of a product, especially its post-consumer or end-of-life stage.

Under the law, these companies must register with the National Solid Waste Management Commission their EPR programs to reduce or recover for reuse or recycling the plastic packaging waste that they release to the local market.

Plastic packaging covered by the law includes sachets, labels, laminates and other flexible plastic packaging products; rigid plastics used for beverages, food, home, personal care and cosmetic products and their caps, cutlery, plates and drinking straws; plastic bags; and polystyrene.

The Department of Environment and Natural Resources data showed that as of October 2023, 745 enterprises had submitted their EPR programs, fewer than the 4,000 expected.

Other uses of Prestige’s premium special paper are for calling cards, letterheads and stationaries, publication and arts and crafts.

“We have also worked with certain hotels pushing for certified paper like Okada Manila and Newport World Resorts,” Ms. Ayeng said. “We’ve also worked with SM and Ayala for their brochures.”

She said companies should use sustainable materials to comply with the law.

Instead of using the PVC-based Sintra board — a plastic vinyl board suitable for mounting banners and photos — Prestige offers the Eska board, which is made of 100% recovered paper.

“You cannot greenwash, as if we are saying, ‘Oh, our spaces are environment-friendly,’ but you have to start auditing the other materials that you’re using, otherwise it’s going to hurt your brand,” Ms. Ayeng said.

Prestige, which started in 1996, ensures that the brands it carries are made with pulp from well-managed forests and have been certified by the Programme for the Endorsement of Forest Certification and Forest Stewardship Council.

“We believe that being responsible is also a profitable business,” she said.

Prestige is a member of the UN Global Compact, the largest corporate sustainability initiative that calls on companies to align their strategies and operations to achieve sustainable development goals by 2030.       

“Before the pandemic, the demand was coming from the graphic or commercial printing, but the demand shifted to packaging, labeling and at the same time, more eco-friendly promotional materials,” Ms. Ayeng said.

She said Prestige has helped local companies shift to sustainable packaging materials as well as the so-called corporate collaterals of various hotels, real estate and small businesses as they try to conquer the global market.

Ms. Ayeng said one of the company’s fastest-selling products is specialty paper of the Italian mill Fedrigoni, which is used as a packaging material for luxury brands Louis Vuitton and Dior.

She said Prestige’s stationery items are selling well overseas, but it would rather focus on boosting its online presence and expanding its branches locally. — Aubrey Rose A. Inosante

Villar-led companies announce management revamp to boost structure

VILLAR-LED listed companies on Tuesday announced leadership changes as part of efforts to bolster the group’s corporate structure.

The board of supermarket operator AllDay Marts, Inc. elected Jacqueline B. Cano as acting president after a special meeting on May 27, the company said in a stock exchange filing.

Ms. Cano kept her post as chief operating officer. She replaced Frances Rosalie T. Coloma, who stepped down as president and chief executive officer.

Ms. Cano started in the retail business as a district manager for Abenson from 1994 to 1997, AllDay said.

She also served as an area manager for Waltermart from 1998 to 2005, and as a store general manager for Pilipinas Makro, Inc. from 2005 to 2011. Before her executive post at AllDay, Ms. Cano was the regional manager of Metro Gaisano from 2011 to 2015.

Ms. Coloma was elected chief operating officer of listed home improvement retailer AllHome Corp. after a special board meeting on May 27.  She replaced Marianita N. Domingo, who resigned for personal reasons.

AllHome’s board also elected Vanessa L. Bauzon-Crisol as chief audit executive after Joselito A. Rivamonte, who was transferred to another company within the Villar group, resigned.

Meanwhile, Vista Land & Lifescapes, Inc. and Vistamalls, Inc. said in separate disclosures that Melissa Camille Z. Domingo had temporarily stepped down as chief audit executive of the two companies to take a study leave for a year.

The boards of the two companies approved the appointment of Leamor S. Harlea as officer-in-charge chief audit executive effective May 27.

Vista Land’s real estate investment trust, VistaREIT, Inc., said in a separate disclosure that Ms. Domingo had temporarily left her roles as chief financial officer, treasurer and head of investor relations.

VistaREIT’s board approved the appointment of Brian N. Edang as officer-in-charge chief financial officer, treasurer and investor relations head effective May 27.

AllDay stocks fell by 2.11% or 3 centavos to close P0.139 each. AllHome shares rose by 1.12% or a centavo to 90 centavos each.

Vista Land shares gained 0.62% or a centavo to P1.62 each, while VistaREIT shares were unchanged at P1.75 apiece. Shares of Vistamalls were last traded on May 24 at P2.32 each. — Revin Mikhael D. Ochave

PLDT, labor union agree to negotiate; strike averted

PHILSTAR FILE PHOTO

PLDT Inc. on Tuesday said its management has agreed to discuss a collective bargaining agreement (CBA) with its labor union, effectively averting a strike.

“PLDT Management and the Manggagawa sa Komunikasyon ng Pilipinas (MKP)… have come to an amicable resolution as to when to begin their 2024-2027 collective bargaining agreement negotiations,” the telecommunication company said in a stock exchange filing.

MKP is the exclusive bargaining representative of PLDT’s rank-and-file employees.

PLDT said the notice of strike filed by the union in April had been lifted.

“PLDT operations remain ‘business as usual’ and focused on serving the needs of its customers,” the company said.

Last week, PLDT said it was ready to start the negotiations with MKP by September as its CBA expires on Nov. 8.

PLDT cited the Labor Code, noting that both parties must meet and negotiate the renewal or modification of the bargaining deal at least 60 days before it expires.

PLDT shares gained 0.14% or P2 to close at P1,410 each.

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. — Ashley Erika O. Jose

Central bank mops up P1.54 trillion in liquidity via monetary operations

BW FILE PHOTO

THE BANGKO SENTRAL ng Pilipinas (BSP) has siphoned off P1.544 trillion in excess money supply from the market through its monetary operations as of last month, latest data showed.

“As of 26 April 2024, the total outstanding amount absorbed in the BSP liquidity facilities settled at P1.544 trillion,” the central bank said in its May 2024 Monetary Policy Report.

The central bank absorbs excess cash from the financial system through its monetary instruments, which include its overnight reverse repurchase (ON RRP) facility, its primary instrument, short-term liquidity management tools, and standing liquidity facilities.

“To ensure that the monetary policy decision is transmitted to the financial market and the economy in general, the BSP uses its suite of monetary instruments to influence the underlying demand and supply conditions for central bank money,” the central said on its website.

The bulk or 69.2% of the total was absorbed through its liquidity management and absorption tools, namely the BSP bills (BSPB) and term deposit facility (TDF).

Of the total, BSP bills accounted for 50.1%, while the remaining 19.1% was placed in the TDF.

Meanwhile, placements in the BSP’s ON RRP facility and overnight deposit facility accounted for 21.4% and 9.4%, respectively, of the total amount mopped up from the financial system.

“At the 26 April 2024 auction, the ON RRP rate settled at 6.0529%, 0.29 basis point (bp) higher than the target RRP rate of 6.5%,” the central bank said.

“The year-to-date (y-t-d) average spread between the ON RRP rate and the target RRP rate narrowed to 2.35 bps from the y-t-d average of 3.04 bps of the previous month,” it said.

At the April 24 auctions, the weighted average interest rate (WAIR) for the seven-day term deposit inched down by 0.84 bp to 6.53%, while that for the 14-day paper declined by 1.56 bps to 6.5668%, the BSP added.

For the BSP bills, the WAIR for the 28-day tenor edged lower by 0.22 bp to 6.6804%, while that for the 56-day BSPB dropped by 1.39 bps to 6.664% in the April 26 auctions.

“Meanwhile, interest rates for the TDF and the BSP bills decreased but remained within the interest rate corridor and above the ON RRP rate, as market participants were assigned a premium for the longer duration,” it added. — L.M.J.C. Jocson

Once-lost Caravaggio painting to go on display in Spain’s El Prado museum

ECCE HOMO (after the restoration) by Michelangelo Merisi da Caravaggio. Image courtesy of the private collection — MUSEODELPRADO.ES

MADRID — Madrid’s Prado Museum unveiled a painting by Italian baroque master Caravaggio on Monday that will go on public display for the first time this week after what the museum has described as one of the greatest discoveries in the history of art.

All trace of Ecce Homo (Behold the Man) had been lost since the 19th century before re-emerging three years ago, when the painting, initially attributed to an unknown Spanish painter, was about to go under the hammer in Spain for a fraction of its value.

Caravaggio, who died in 1610 in his late thirties after a turbulent life, was a master of using the chiaroscuro technique of lighting to make his subjects seem to come alive.

The depiction of a suffering Jesus Christ in a crown of thorns was painted between 1605 and 1609, shortly before Caravaggio’s death, and is believed to have once belonged to King Philip IV of Spain.

“We can now fully enjoy all the nuances, all the subtleties, the enormous beauty that Caravaggio expresses through his version of the Ecce Homo,” David Garcia Cueto, head of the department of pre-1800 Italian and French painting at Madrid’s El Prado Museum, told reporters on Monday.

Its new owner, an international art collector based in Spain, has sealed a deal with the museum to keep the artwork on display until October, although it could be extended as the owner’s intention is to showcase it permanently.

In 2021, Spain blocked the auction of the painting after experts suggested it might have been the work of Michelangelo Merisi da Caravaggio rather than an unknown peer of 17th century Spaniard Jose de Ribera, who was thought to have painted it.

Art history professor Maria Cristina Terzaghi then traced the painting to its previous owners, the family of 19th-century politician Evaristo Perez de Castro. — Reuters

The long wait for rate cuts may be just beginning

NATHAN DUMLAO-UNSPLASH

LOOKING for those interest-rate cuts markets once breathlessly anticipated is beginning to feel like sorting through cardboard boxes after moving house. What you seek is in there somewhere. Just one more container ought to do it.

Reductions that had been penciled for mid-year — in some market wagers, earlier than that — have been regularly pushed back. It’s fair to wonder whether they will instead be a feature of 2025. New Zealand contemplated a further hike last week; the country was once expected to be among the first to offer relief and should, by some reckoning, have done so by now given its languishing economy. South Korea, one of the first to move against inflation, will have to wait. Resilient price gains in India have likely postponed a decision. Barely a week passes without a big Wall Street name pushing back their timetable. Goldman Sachs Group, Inc. economists are now projecting the Federal Reserve will ease in September, as opposed to July. The company’s chief executive officer takes a less nuanced view: David Solomon sees none this year. Inflation is proving stickier than anticipated in most economies and, with a few exceptions, growth has held up without cuts. (The European Central Bank is likely to break away from the pack, given officials have talked so often about trimming in June.)

The discouraging news is there may be more to this wait-and-see than a couple of months’ worth of data. Inflation has come down, though in many places the pace of price increases still exceeds central bank targets. Given the opprobrium heaped on them for being slow to tighten as inflation spiked in 2021 and early 2022, who can blame authorities for being cautious? Time and again, the experience of the 1970s — when high inflation became entrenched — is rolled out by hawks as a kind of morality play.

Did central banks make mistakes? During a session of the Asian Monetary Policy Forum on Friday, they were scolded for believing high inflation was consigned to the history books. They had too much faith in forward guidance and the implicit ability to accurately project the direction of economies, a former official told the conference in Singapore. Pledges that quantitative easing (QE) would be tapered before rates went up delayed a timely response. The consensus seemed to be that any scaling down this year will be minimal, almost tokenistic; conditions that would normally justify large cuts don’t exist. This assessment is harsh. After all, between the subprime meltdown and the second year of the pandemic, inflation was the dog that didn’t bite. Then-Fed chief Janet Yellen, now Treasury Secretary, called it a “mystery.” Conservative pundits confidently predicted that waves of QE would lead to a debasement of the dollar. That didn’t happen. It’s understandable, given the period of too-low inflation, that officials would be reluctant to leap at the first twitches of rising prices. Central banks also had little experience dealing with COVID-era supply chain disruptions on a truly grand scale.

It’s fine, if frustrating for some investors, to hold off a little longer on easing. But beyond debate about whether a particular indicator arrives a basis point or two above expectations, might an underlying shift in the world economy be taking place? In a March paper for The Brookings Institution, Hassan Afrouzi, Marina Halac, Kenneth Rogoff, and Pierre Yared warned of more frequent spikes in prices. Historical trends that constrained inflation and made the job of central banks less arduous are reversing.

The authors argue that a retreat in globalization, the strain on budgets from graying societies and political populism, higher defense spending, and even the green transition will put upward pressure on rates. “We think that it’s quite likely that inflation comes down this time around,” Yared told a Brookings podcast last week. But “the chances of inflation going back up and experiencing the kind of spikes we saw is much more likely.”

A golden era of central banking may have passed, not that it always felt that way. The years when authorities pined for more inflation had their share of upheaval: the Asian financial crisis, the risk of deflation in the early 2000s, the deep recession unleashed by the failure of Lehman Brothers Holdings, Inc., all the way through the dramatic — and contentious — expansion of central banking power during the worst of COVID.

Next time CPI in the US, Australia, or Indonesia misses forecasts by a tenth of a percent, check your anxiety. Far more is at stake. Monetary bosses need to brace for a new — or return of the old — world. Treasure the rate cuts when they do come. As for those moving boxes, I gathered the courage to sort through a few stragglers last year after my move from New York to Singapore in 2019. I stumbled across a smattering of business cards. The name on one? Haruhiko Kuroda, the Bank of Japan governor who took rates negative and embarked on a massive expansion of QE. Truly a blast from the past.

 

BLOOMBERG OPINION

France looks to elusive EU capital market to fix startup funding

WIKIMEDIA.ORG

PARIS — France is banking on a new push to integrate the European Union’s (EU) fragmented capital markets to give them the scale needed to wean its flourishing startup sector off of dominant US venture capital, ministers, CEOs and investors said.

A hodgepodge of local regulations and oversight has kept Europe’s financial markets largely shaped by national borders, preventing the emergence of deep capital markets to rival the United States.

For startups in France and elsewhere in European Union that means they almost inevitably turn to US venture capital — private equity funding of early stage promising companies — to fund growth as there simply is not enough big investors at home.

While the US funding is welcome, the result is a missed opportunity for Europe, said Matthieu Rouif, CEO of French startup Photoroom, which recently raised $43 million from UK fund Balderton and Silicon Valley’s Y Combinator.

“A huge amount of wealth has been created over the past 20 years, created off the back of tech innovation, and the fact Europeans don’t have access to that is a big issue,” he said at the Viva Technology fair in Paris last week.

The 10 biggest venture capital firms are all from the United States and dwarf their European rivals in the amounts of money they can raise for investment, according to the French central bank.

A report published by venture capital firm Atomico in 2023 estimated European startups would raise $45 billion that year, compared with the $120 billion raised in the US.

The French government is therefore pushing for the next European Commission to make a priority of reviving long-stalled plans for EU capitals market union harmonizing financial regulations and supervision across the 27-nation bloc.

While a consensus is emerging among EU governments to move ahead at least in principle, in practice some remain reluctant to lose regulatory control of their financial markets.

French Finance Minister Bruno Le Maire warned that Europe could not afford to keep dithering, citing the example of Mistral AI, France’s answer to OpenAi.

“Mistral needs to raise money in the next six months, it’s going to be a lot of money. So either we move ahead with capital markets union or else they will go somewhere else,” Mr. Le Maire said at the Paris tech fair.

Another way to scale up EU venture capital would be to get public sector investors, such as the European Investment Bank, more involved in financing startups by accepting more risk than private investors, Bank of France Governor Francois Villeroy de Galhau said.

Meanwhile, for European venture capital firms, a single unified market would make it more attractive to float the companies they fund in Europe rather than the United States.

“As a French citizen, it’s a shame to see that the value creation flywheel isn’t spinning as fast in Europe as it is in the US,” said Antoine Moyroud at Silicon Valley venture capital fund Lightspeed, which is one of Mistral’s investors.

European startups that end up floating on markets at home could also expect a more stable investor base than in the United States, where investors are more likely to sell down holdings in foreign firms during a downturn, said Louis Dussart with venture capital group RTP Global.

“It would truly be a pivotal moment if we could establish Europe as an attractive place to exit and bring liquidity back into the ecosystem,” Mr. Dussart said. — Reuters

Megawide allots P3B to finance expansion

MEGAWIDE Construction Corp. has allotted as much as P3 billion for its capital expenditures (capex) to finance expansion plans this year, its top official said on Tuesday.

The company is spending P2.5 billion to P3 billion on capex, Megawide Chairman and Chief Executive Officer Edgar B. Saavedra told reporters on the sidelines of a groundbreaking ceremony for a housing project in Imus, Cavite.

He said Megawide spent about P1 billion worth of capex last year. “The capex is definitely higher this year than last year. Our projects started late last year and are now just taking off this year.”

Mr. Saavedra said about P1 billion of this year’s capex would be earmarked for Megawide, while the remaining budget would be allotted for the projects of its various units including PH1 World Developers, Inc. and Cebu2World Development, Inc. 

“We have three or four projects for PH1 World and then for Megawide, we also have construction and factory [project],” he added.

Mr. Saavedra said he is bullish about Megawide prospects for the rest of the year. “I am very bullish. The economy is already recovering.”

“We already finished the old problematic contracts during the pandemic. We have new projects and we have already fixed our order book,” he added.

Mr. Saavedra said Megawide is banking on the rising housing demand spurred by the stronger spending power of its clients.

He added that the lower affordable housing segment has experienced growth, while the mid-segment has been stable.

“There is demand for housing especially that the minimum wage is increasing. The higher wage improves the spending power of buyers,” he said.

Megawide had P183.4 million in consolidated net income last quarter, a reversal of its P7.4-million net loss a year earlier. Consolidated revenue increased by 19% to P5.2 billion.

Megawide shares were unchanged at P3.16 each. — Revin Mikhael D. Ochave

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