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French budget deficit for 2025 will not be ‘much’ above 5% -minister

CHRIS KARIDIS-UNSPLASH

PARIS – France’s budget deficit for 2025 “will not be much above 5%,” the country’s budget minister Amelie de Montchalin reaffirmed in an interview published on Sunday with Le Parisien paper.

Last month, French Finance Minister Eric Lombard had also said France’s delayed 2025 budget bill would target a deficit of “slightly above 5%”.

Reducing France’s deficit, which has consistently been above limits set by the European Union, has been earmarked as a priority for Prime Minister Francois Bayrou, as it was for his predecessor Michel Barnier, who was ousted in December.

However, Bayrou – similar to Barnier – faces challenges over finding ways to cut public spending amid opposition from both far-right and far-left political parties.

France’s 2024 deficit is expected to stand at above 6% of gross domestic product (GDP). – Reuters

Egypt to receive $1.2 billion as part of IMF programme in January, finance minister says

THE International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, U.S. — REUTERS

CAIRO – Egypt is expected to receive a $1.2 billion disbursement from the International Monetary Fund this month as part of an $8 billion programme with the international lender, Finance Minister Ahmed Kouchouk said on Sunday.

Last month, the IMF said it reached a staff-level agreement with Egypt on the fourth review of the 46-month Extended Fund Facility arrangement, potentially unlocking the $1.2 billion disbursement.

“The (IMF’s executive) board will convene in January and, God willing, we will receive the amount in January,” Mr. Kouchouk told ON TV in an interview, adding Egypt had not requested an increase to the $8 billion loan.

Egypt, grappling with high inflation and shortages of foreign currency, agreed to the expanded IMF programme in March. A sharp decline in Suez Canal revenue caused by regional tensions over the last year compounded its economic woes.

Mr. Kouchouk also said Egypt is targeting about $3 billion in the remainder of the current fiscal year, which runs until the end of June, through “diverse issuances” to investors, without elaborating further. His comments came in response to a question about whether Egypt plans to offer new bonds to foreign investors this year. – Reuters

Musk turns on UK’s Farage and says he should quit as Reform party leader

ELON MUSK — REUTERS

LONDON – Elon Musk said Nigel Farage should quit as leader of Britain’s right-wing Reform UK party in an abrupt withdrawal of support by the U.S. billionaire for the Brexit campaigner who is trying to shake up the British political establishment again.

“The Reform Party needs a new leader. Farage doesn’t have what it takes,” Mr. Musk said on his social media platform X on Sunday, a few hours after Farage described him as a friend who made Reform look “cool”.

Mr. Musk – a close ally of U.S. President-elect Donald Trump – had seemingly backed Farage and posed for a photograph with him last month.

Reform won 4.1 million votes or 14% of the total and five seats in parliament in last July’s national election.

Farage has previously said he is in negotiations with Mr. Musk about the billionaire donating to Reform to help it challenge the dominant Labour and Conservative parties.

But Mr. Farage has distanced himself from comments made by Mr. Musk in support of British anti-immigration and anti-Muslim activist Stephen Yaxley-Lennon, known by the pseudonym Tommy Robinson, who is serving a prison sentence for contempt of court.

Mr. Farage responded to Mr. Musk’s post on Sunday saying: “Well, this is a surprise! Elon is a remarkable individual but on this I am afraid I disagree. My view remains that Tommy Robinson is not right for Reform and I never sell out my principles.”

Last month, Mr. Musk endorsed the Alternative for Germany, an anti-immigration, anti-Islamic party labelled as right-wing-extremist by German security services, ahead of national elections in February.

Mr. Musk has previously sought to influence British politics and has criticised Prime Minister Keir Starmer repeatedly since anti-immigration riots last summer.

The Tesla founder last week backed calls for a national inquiry into the handling of cases of rape by men of Pakistani heritage of underage girls by the government’s prosecution service which Starmer previously ran.

A 2014 inquiry found at least 1,400 children were subjected to sexual exploitation in Rotherham, northern England, between 1997 and 2013.

The Times said Mr. Starmer was expected to address the criticism at a news conference on Monday by saying he gave the green light to prosecuting paedophile gangs in 2013 and reformed the way that child abuse cases are handled by prosecutors.

But he was unlikely to criticize Mr. Musk directly given the billionaire’s proximity to Trump, the newspaper said.

A spokesperson in Mr. Starmer’s office declined to comment.

On Sunday, UK health minister Wes Streeting defended Starmer and another member of his cabinet, Jess Phillips, who incurred Mr. Musk’s ire for reportedly saying that any fresh inquiry into another gang rape case should be handled by the local authority.

“It’s all very easy to sit there and fire off something in haste and click ‘send’ when people like Keir Starmer and Jess Phillips have done the hard yards of actually locking up wife beaters, rapists and paedophiles,” Mr. Streeting told the BBC. – Reuters

Inflation likely picked up in Dec. — poll

A vendor displays fruits at a stall in Quezon City, Dec. 29, 2024. — PHILIPPINE STAR/MIGUEL DE GUZMAN

By Luisa Maria Jacinta C. Jocson, Reporter

HEADLINE INFLATION may have quickened in December amid higher prices of food and utilities, but full-year inflation likely settled within the 2-4% target band, analysts said.

A BusinessWorld poll of 13 analysts yielded a median estimate of 2.7% for the consumer price index (CPI) in December.

This is within the 2.3%-3.1% forecast of the Bangko Sentral ng Pilipinas (BSP) for the month.

Analysts’ December inflation rate estimates

If realized, December inflation would have been faster than the 2.5% in November but slower than the 3.9% in the same month in 2023.

December would also mark the third straight month that inflation accelerated on a monthly basis.

The Philippine Statistics Authority (PSA) is set to release December and full-year inflation data on Jan. 7.

“We estimate that inflation rose to 2.7% in December from 2.5% in the previous month, which would bring the full-year inflation rate to 3.2% for 2024,” Chinabank Research said.

“We expect inflation to lift 2.7% year on year in December, bringing the full-year inflation to 3.2%,” Sarah Tan, an economist from Moody’s Analytics, said.

Security Bank Corp. Vice-President and Research Division Head Angelo B. Taningco said that food inflation was still likely the main contributor to the overall CPI in December.

“The acceleration from November’s 2.5% will be driven by higher price pressures in the food and electricity categories,” Ms. Tan said.

She said this was due to the damage from typhoons that hit the country from late October to November.

“These storms came after the typical peak typhoon season that lasted till October. Lowland vegetables and rice were some of the hardest hit crops as the typhoons swept across key farming areas,” she said.

“The overall impact on food production will continue to show up in December’s inflation print,” she added.

The Philippines saw six typhoons entering its Area of Responsibility in November, according to the Philippine Atmospheric, Geophysical, and Astronomical Services Administration.

“We observed higher prices for some key food items such as vegetables and fish, along with increases in electricity rates and costs of LPG and petroleum,” Chinabank Research said.

Mr. Taningco said hikes in electricity rates and pump prices may have also contributed to the inflation print in December.

In December, pump price adjustments stood at a net increase of P1.40 a liter for gasoline and P1.45 a liter for diesel. However, kerosene prices had a net decrease of P0.80 a liter.

Meanwhile, Manila Electric Co. (Meralco) raised the overall rate by P0.1048 per kilowatt-hour (kWh) to P11.9617 per kWh in December from P11.8569 in November.

Oikonomia Advisory & Research, Inc. economist Reinielle Matt Erece also noted the impact of holiday spending on December inflation.

“The slight uptick in December CPI may have come from seasonal demand largely from the broad food items, particularly ‘noche buena’ food stuff, that would historically have cyclical upticks,” Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said.

FULL-YEAR WITHIN TARGET
Despite the faster inflation in December, full-year inflation is seen to settle firmly within the 2-4% target.

“We are still confident that despite this uptick, the full-year inflation will be around 3.2% which is still within the BSP’s targets,” Mr. Erece said.

The BSP expects inflation to average 3.2% in 2024.

It also expects inflation to remain within target from 2025 to 2026. Its baseline and risk-adjusted forecasts for both years are seen to settle within the 2-4% band.

“Looking ahead, we expect inflation to remain within the BSP’s 2-4% target range, supported by lower tariffs on rice imports,” Chinabank Research said.

“Average inflation for 2024 is at the midpoint of the BSP’s inflation target, and we expect 2025 inflation to be slower at 3% at this point,” Mr. Asuncion said.

This would help pave the way for continued monetary easing in 2025, he added.

“For the coming months, it is possible for inflation to sustain at 2% levels up to early 2025, or well within the BSP inflation target range of 2-4%, that could justify further BSP rate cuts,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

Mr. Taningco said that the central bank will likely employ a “gradual pace” of rate cuts.

In 2024, the BSP has delivered a total of 75 basis points (bps) of rate cuts since it kickstarted its easing cycle in August.

“We expect monetary policy easing to continue in 2025. However, BSP will be prudent in monitoring global developments that could reinflate inflation and weaken the strength of the peso,” Ms. Tan said.

In 2024, the peso closed at its record low of P59 thrice (on Nov. 21, Nov. 26, and Dec. 19.) as the dollar surged on bets of slower rate cuts by the US Federal Reserve amid inflation concerns.

Sun Life Investment Management and Trust Corp. economist Patrick M. Ella said he forecasts a total of 75 bps worth of rate cuts in increments of 25 bps in 2025.

“We are now looking at three cuts for the BSP (75 bps) instead of a previous forecast of four cuts (100 bps). We do not see them cutting with the Fed but more in line with domestic data developments,” he said.

The central bank will likely keep reducing rates in “baby steps” as it is still carefully monitoring upside risks to inflation, he added.

RISKS
Analysts likewise cited risks that could delay the BSP’s rate-cutting cycle.

“For one, the prospect of tariffs from the US looms large, and the pace of global interest rate normalization is likely to slow. These will play into the BSP’s decision to loosen monetary policy further (in 2025),” Ms. Tan said.

“However, there are upside risks in the horizon, particularly on the uncertain impacts of the Trump administration on local inflation including overseas Filipino worker (OFW) remittances (in 2025),” Mr. Asuncion said.

Mr. Erece also noted the need to take into account the US Federal Reserve’s own policy moves.

“This inflation print being within their targets and the need to boost economic growth may be the central bank’s signal to continue their monetary policy easing,” he said.

“However, it is in the BSP’s best interest to closely monitor the Fed’s stance with their own monetary policy.”

The Fed aggressively cut rates in September, November and December, but in their last meeting flagged fewer rate cuts for 2025.

“There is a possibility that the Fed may switch to a hawkish stance as inflation continues to linger and if Trump pushes through with his economic reforms such as increases in tariffs, leading to less rate cuts,” Mr. Erece said.

“This can cause further appreciation in the value of the US dollar and may push the BSP to recalibrate their monetary policy easing path to avoid the peso from depreciating quickly through less or smaller rate cuts as well,” he added.

Peso could break P59 level vs dollar this year

BW FILE PHOTO

By Aaron Michael C. Sy, Reporter

THE PESO could breach its record low of P59 this year as Donald J. Trump’s presidency and the Philippine midterm elections may put pressure on the local currency.

“The PHP (Philippine peso) breaching the P59 mark depends on several key factors. Among these are external pressures such as the strength of the USD (US dollar), influenced by the Fed’s monetary policy, and domestic concerns like the trade deficit,” Philippine Institute for Development Studies Senior Research Fellow John Paolo R. Rivera said in a Viber message.

On Jan. 3, the local unit closed at P58.20 per dollar, weakening by 29 centavos from its P57.91 finish on Tuesday, Bankers Association of the Philippines data showed.

The Development Budget Coordination Council (DBCC) has said it expects the peso to “broadly stabilize” at P56 to P58 against the US dollar in 2025.

“In the near term, we expect the currency to range between P57.75 and P58.25. The US dollar has managed to still gain its momentum ahead of Trump’s assumption of office on Jan. 20,” Reyes Tacandong & Co. Senior Adviser Jonathan L. Ravelas said in a Viber message.

Mr. Ravelas said the peso could weaken to as low as P60 per dollar this year, noting that Mr. Trump’s protectionist policies and an “assertive stance” on China could influence trade and investment flows.

“The forex rate is anticipated to range within the P57.75 to P60 levels this year, with the USD/PHP closing at around P58.90 by the end of 2025,” he said.

Mr. Rivera said the US dollar’s strength is likely to persist under Mr. Trump’s presidency.

“A stronger USD is likely under Trump, given the previous administration’s fiscal policies, which may keep US Treasury yields high and attract capital back to the US, weakening emerging-market currencies like the PHP,” he said.

On the other hand, the midterm elections in May could increase forex volatility, Mr. Rivera said.

“Markets may anticipate shifts in economic policy or investor confidence depending on the candidates’ platforms and perceived stability post-election,” he said.

Other factors that could influence the peso’s movements this year include global oil prices and remittances from overseas Filipino workers.

“A persistent trade deficit and the narrowing gap in remittance growth could weigh on the PHP further,” he said.

While the volatility can be managed by the central bank’s active intervention, Mr. Rivera said “sustained structural reforms and enhanced economic fundamentals will be necessary to counter global headwinds and stabilize the PHP in the long term.”

University of the Philippines Los Baños economics senior lecturer Enrico P. Villanueva said he is more concerned about forex volatility than the level of the peso against the US dollar.

“I do not foresee significant volatility in the currency, unless a local or geopolitical event happens. Even then, I am confident in BSP’s ability to cushion drastic rate changes,” he said.

P639B worth of projects up for green lane approval

A wind turbine is seen in this file photo. — REUTERS

AROUND P639 billion worth of projects are seeking expedited processing through the One-Stop Action Center for Strategic Investments (OSACSI), a Board of Investments (BoI) official said.

BoI Investment Assistance Service and OSACSI Director Ernesto C. Delos Reyes, Jr. said they are currently evaluating green lane applications for around P639.09 billion worth of investments.

“Evaluation of applications to the green lane includes determination of the projects’ qualifications as strategic investments and the proponents’ capability to undertake the project from pre-development and construction until commercial operations,” Mr. Delos Reyes said in a Viber message.

Established through Executive Order No. 18, green lanes aim to accelerate and simplify the permit and licensing processes for strategic investments.

The green lane applications in the pipeline comprise 30 projects, with the majority in the renewable energy (RE) sector, said Mr. Delos Reyes.

“Majority, or 24, of the applications are for projects under the renewable energy sector, representing 80% of the projects for green lanes in the pipeline, followed by four projects under the manufacturing sector and two projects under the food security sector,” he said.

“Two of the renewable energy projects are wholly owned by Canadian and Singaporean investors with an investment value of P 7.5 billion,” he added.

As of the end of 2024, the BoI has endorsed P4.54 trillion worth of projects for green lane treatment, which comprise 176 projects.

Of the total, the RE sector accounted for 141 projects worth P4.14 trillion.

The government saw an increase in RE projects after it allowed full foreign ownership in the sector, which was previously capped at 40%.

Meanwhile, eight projects worth P352.13 billion were in digital infrastructure, while 23 projects worth P14.37 billion were in food security. There were four manufacturing projects worth a combined P36.91 billion.

In terms of ownership, 46 are majority foreign-owned, with 30 projects wholly owned by companies from Singapore, Thailand, Malaysia, and the British Virgin Islands.

Denmark was the biggest source of foreign investment at P416.41 billion, followed by the Netherlands (P336.93 billion), Switzerland (P310.74 billion), and Singapore (P230.38 billion).

Of the certified projects, 44 have been registered with the BoI, while 132 projects remain as active investment leads.

In 2025, the BoI is targeting investment pledge approvals to hit P1.75 trillion. This represents an 8% increase from the P1.62 trillion it approved in 2024, which was the highest level in 57 years.

RE projects led the approvals, amounting to P1.38 trillion, a 40% rise from last year. It was followed by air and water transport (P121.2 billion), real estate activities (P37.26 billion), manufacturing (P31.67 billion), water projects (P16.28 billion), and agriculture (P11.02 billion). — Justine Irish D. Tabile

Philippines’ top 1,000 firms post P17.8 trillion in revenues in 2023

Buildings are seen in Makati City, Dec. 17, 2024. — PHILIPPINE STAR /MIGUEL DE GUZMAN

By Lourdes O. Pilar, Researcher

THE TOP 1,000 corporations in the Philippines saw a 7.2% increase in combined revenues to P17.8 trillion in 2023, slowing from the previous year as elevated inflation weighed on economic activity.

The BusinessWorld Top 1000 Corporations in the Philippines report showed the firms’ aggregate gross revenue jumped by 7.2% in 2023 from P16.68 trillion posted in 2022.

The rate of increase was significantly slower than the 21.2% seen in the 2022 edition.

20 Top Grossing Companies in the Philippines

BusinessWorld defines gross revenue as the combination of net sales and nonoperating income.

Meanwhile, the top corporations’ combined net income rose by 13.3% to P2.04 trillion in 2023 from P1.8 trillion in 2022.

The financial performance of these large companies reflected the challenges faced by the Philippine economy in 2023.

Philippine gross domestic product (GDP) grew by 5.5% in 2023, slower than the 7.6% growth recorded in 2022, amid a drop in exports and state spending.

Inflation, which averaged 6% in 2023, also dampened consumer spending. Since May 2022, the central bank raised rates by a cumulative 450 basis points to 6.5% in October 2023.

On its 38th year, the BusinessWorld Top 1000 Corporations in the Philippines ranks private and public stock corporations based on gross revenue using the latest available full-year audited financial statements.

The latest edition of the Top 1000 had a gross revenue cutoff of P3.15 billion in 2023, 5.8% higher than the previous edition’s P2.98 billion.

Out of the 1,000 companies in the list, 683 posted higher gross revenues in 2023, 17.4% lower than the 827 companies in the previous year.

The report showed 591 companies saw net income growth in 2023, while 409 saw a decline in profit.

There were 58 firms that swung to a profit in 2023 after recording a net loss in the previous year, while 43 companies slumped to a net loss.

Meanwhile, 59 firms remained in the red.

Firms included in the Top 1000 list represented 18 out of the 21 major sectors under the 2009 Philippine Standard Industrial Classification (updated 2019).

Ten sectors reported at least double-digit gross revenue growth, with public administration and defense sector’s revenues jumping by 306.5% in 2023.

Meanwhile, the mining and quarrying sector’s revenues declined by 11.5% in 2023.

The manufacturing sector, which had 271 companies included in the list, accounted for 32.4% of the total gross revenue of the Top 1000 companies in 2023.

The services sector continued to be the main engine of Philippine economic growth, accounting for 55.2% of the aggregate gross revenue in 2023.

Multinational companies included in the Top 1000 list made P5.63 trillion, up 3.6% from the previous year. They accounted for 31.6% of the Top 1000’s gross revenues.

Exporting firms posted a 0.9% increase in revenues to P2.94 trillion, slowing from the 15% growth in the previous year. The sector accounted for 16.5% of the list’s total gross revenues.

In the latest edition, 35 corporations were first-time entrants, while 64 were returnees.

Petron Corp. maintained its status as the country’s top-grossing company in the Philippines in 2023, with P440.6 billion in gross revenue. It was up 0.4% from P438.87 billion the previous year.

The oil refiner and distributor also topped the list in terms of net sales with P435.96 billion. Petron’s net income rose by 151.7% to P6.38 billion, ranked 85th on the list.

Meralco came in second on the list, with gross revenue rising by 4.5% to P399.36 billion from P382.32 billion in 2022. It ranked second in net sales with P391.93 billion. The company posted a net profit of P28.33 billion in 2023, up by 30.6% from P21.69 billion in the previous year.

BDO Unibank, Inc. bagged the third spot as gross revenue jumped by 35.6% to P283.75 billion from P209.29 billion in 2022. The banking arm of the SM group ranked third in terms of net sales (P282.25 billion) and second in net income (P67.2 billion).

Also included in the top 10 were Shell Pilipinas Corp. (P256.2 billion in gross revenues); Toyota Motor Philippines Corp. (P216.18 billion); Mercury Drug Corp. (P193.92 billion); Philippine Airlines, Inc. (P183.63 billion); TI (Philippines), Inc. (P181.22 billion); Bank of the Philippine Islands (P166.92 billion); and Globe Telecom, Inc. (P157.04 billion).

The Top 1000 report has been providing a separate table to show how companies compare with each other on a consolidated basis.

With this consolidated table, readers will be able to see the impact of additional revenues coming from subsidiaries boosting a conglomerate’s rank.

Top Frontier Investment Holdings, Inc. and subsidiaries remained the largest conglomerate in the list of the top 200 conglomerates in 2023.

The holding company, which is the largest shareholder of San Miguel Corp. (SMC), posted P1.53 trillion in gross revenue in 2023, 3.4% lower from 2022. The conglomerate’s net income increased by 90.4% to P45.45 billion.

Listed diversified conglomerate SMC and its subsidiaries ranked second, with P1.53 trillion in gross revenues, down by 3.4% from P1.58 trillion in 2022.

Petron and its subsidiaries claimed the third spot with P804.97 billion in gross revenues, a 7% decrease year on year.

The rest of the top 10 conglomerates included SM Investments Corp. (P621.02 billion); Manila Electric Co. (P459.24 billion); San Miguel Food and Beverage, Inc. (P386.04); Ayala Corp. (P363.07 billion);  Mermac, Inc. (P358.44 billion); JG Summit Holdings, Inc. (P349.26 billion); and  Aboitiz Equity Ventures, Inc. (P345.15 billion).

The BusinessWorld Top 1000 Corporations in the Philippines can be purchased directly by reaching out to BusinessWorld’s Circulation Department at (+63 2) 8527-7777 locals 2651 to 2654 or via e-mail at circ@bworldonline.com. The portable document format (PDF) version will also be available for purchase at https://bworld-x.com/.

BCDA 2024 revenue tops P11B

THE Bases Conversion and Development Authority (BCDA) said it booked P11.3 billion in gross revenue last year, up 3%, with results driven by its joint venture (JV) deal for a mixed-use development in Taguig City.

In a statement over the weekend, the government-owned corporation described its revenue performance as “steady” and “positive.”

“This steady growth and positive financial performance was mainly attributed to the execution of a JV agreement for the development of the 6.1-hectare mixed-use development in Bonifacio Capital District in Taguig, which yielded an initial payment of P3.5 billion to the BCDA,” it said.

BCDA also cited the 39% increase in toll and airport concession revenue to P3.2 billion.

It also saw a 48% increase in dividends from affiliates to P1 billion.

“Through collaboration with partners that share our vision and efficient revenue generation efforts, the BCDA wrapped up 2024 as another banner year for the organization, sustaining its good financial performance over the years,” BCDA President and Chief Executive Officer Joshua M. Bingcang said.

“This is fueled by our mission to build world-class cities and implement game-changing projects for the benefit of the Filipino people,” he added.

For 2025, he said the BCDA expects to continue with revenue levels exceeding P10 billion.

 “We are committed to continue generating strong revenue, as this will allow us to boost our support for our beneficiary agencies and stakeholders, especially our military forces,” he added.

In a separate statement, the BCDA warned of the dissemination of inaccurate interpretations of the Supreme Court decision regarding the issue on Camp John Hay.

“Despite the clear language of the Supreme Court Decision, some persons in the guise of allegedly protecting the rights of third persons, have sought to disseminate misinformation and an inaccurate interpretation of the decision,” the BCDA said. 

“The BCDA advises everyone to be vigilant and read the Supreme Court Decision itself to correct any and all attempts at defrauding the public,” it added.

According to BCDA, the Supreme Court’s recent ruling allows BCDA to regain control over Camp John Hay, which is expected to attract new investment, open the site to all, allow redevelopment, and drive sustainable economic growth. — Justine Irish D. Tabile

Philippine energy companies upbeat as projects go online

PHILIPPINE STAR/MICHAEL VARCAS

By Sheldeen Joy Talavera, Reporter

SOME listed energy companies are bullish for growth this year as power projects that are expected to go online provide additional power supply to the grid.

“The year 2024 was a wake-up call, not only for the energy sector but for the entire country,” Antonio Miguel B. Alcantara, chief executive officer (CEO) at Alsons Power Group, told BusinessWorld in an interview. “The red and yellow alerts experienced across the country underscore the urgent need to enhance the Philippines’ power supply, demand management and transmission reliability.”

Last year, the Philippines’ main grids were placed under 16 red alerts and 62 yellow alerts, leading to brownouts.

“At Alsons Power, we are optimistic that 2025 will be another remarkable year,” Mr. Alcantara said.

The company is set to launch its first large-scale solar power plant as part of its plan to diversify its energy portfolio.

Alsons’ power generation facilities are concentrated in Mindanao. It has four power facilities with a combined capacity of 468 megawatts (MW).

Last year, the company started commercial operations of its first renewable energy project, the 14.5-MW Siguil Hydro Power Plant in Maasim, Sarangani.

“In Mindanao, the Department of Energy noted an adequate power supply outlook for the region,” Mr. Alcantara said. “Nevertheless, there is a pressing need to enhance generation capacity to address the expected growth in energy demand over the coming years, as well as to account for the frequent provision of power to the Visayas.”

Meanwhile, power distributor Manila Electric Co. (Meralco) cited the need to enhance its distribution network’s resilience and smartness through grid modernization projects, storm-hardening program and continued investments in advanced technologies, Executive Vice-President and Chief Operating Officer Ronnie L. Aperocho said.

This includes capital-intensive projects such as smart substations and the rollout of smart meters for Meralco’s eight million customers.

“With an upbeat economic growth forecast for the Philippines for 2025, we are optimistic that this will be mirrored in Meralco’s growth prospects, supported by our strategic efforts to invest, innovate and increase the value of the services that we deliver to our stakeholders, which include our customers and the country,” Mr. Aperocho said.

ACEN Corp., the listed energy unit of Ayala Corp., expects a “better supply situation” this year as large thermal plants start operations, along with new renewable energy plants in the next 12 to 18 months.

“Given the variable nature of renewables, we need to step up efforts to integrate more energy storage into the grid,” Eric T. Francia, president and CEO at ACEN, said in a Viber message.

The company has about 2,400 MW of renewable capacity in the Philippines, about 1,000 MW of which is under construction.

Mr. Francia said ACEN seeks to participate in the government’s green energy auctions and build up capacity to support the company’s retail electricity business.

“We aspire to further scale our renewable capacity in the Philippines by over three times for the balance of the decade,” he said.

Meanwhile, Alternergy Holdings Corp. sees 2024 as a “transformative year” as it managed to raise P20 billion in just 15 months as a listed company. This is expected to fuel the company’s growth and lay the groundwork to achieve its target of 500-MW capacity by 2026.

Last year, the company started building its three projects — Tanay and Alabat Wind Power projects and Balsik Solar Power project. Construction of the Dupinga Run-of-River Power project and the first phase of Kiangan Run-of-River Power project continue.

“We are bullish at Alternergy as we aim for the complete construction of four of our wind, solar and hydro projects by the end of 2025,” Vicente S. Perez, Jr., chairman at Alternergy, said in a Viber message.

The company is gearing up for the next phase of capital-raising to meet the equity needs of its project pipeline.

Energy projects covering 5,675.28 MW are scheduled to start commercial operations in 2025, according to data from Energy department.

Damosa Land bullish over Mindanao property market

RICARDO F. LAGDAMEO — DAMOSALAND.COM

By Beatriz Marie D. Cruz, Reporter

DAMOSA LAND, INC. is looking to expand in Mindanao through digitalization efforts and increased demand for “green” and sustainable projects, according to its chief executive officer (CEO).

“We’re always trying to be innovative,” Damosa President and CEO Ricardo F. Lagdameo told BusinessWorld in a Zoom interview. “We’re trying to bring in new ideas that we learn abroad, and even just from projects in Metro Manila.”

Mr. Lagdameo is a third-generation scion leading Damosa, the property development arm of Davao-based ANFLOCOR Group of Companies, which was founded by his grandfather, the late Antonio O. Floirendo, Sr. Damosa specializes in mixed-use, residential, commercial, industrial and tourist properties.

He noted how their real estate developments have integrated sustainability features in the structure and in the overall design of their townships. “Our buildings are now green. We try to use less material, meaning less cement.”

The Damosa Diamond Tower in Davao City has an Excellence in Design for Greater Efficiencies (EDGE) final certification for its environment-friendly features such as a green roof deck, solar power and rainwater harvesting.

Damosa properties also feature “sustainable communities,” integrating practices such as urban farming.

“In our townships, we have an abundance of things just growing all over the place which are edible,” Mr. Lagdameo said. “So, even when we turn over your house, you already have like a starter planter box where you can have things like vegetables and other produce.”

On Sundays, local farmers are invited to Damosa’s townships where they could sell their produce, he pointed out.

“We make sure that we’re being responsible with the projects that we choose, how we build them and what’s our contribution to the environment and the community,” Mr. Lagdameo said.

The company also has a roster of younger members that help modernize its processes, such as digitalization.

Damosa has been marketing its projects through sales videos, virtual tours and mobile apps to reach more buyers. This has also helped streamline internal office processes, improving the company’s operations.

The property developer is also looking at further expansion across northern Mindanao including in Cagayan de Oro to capture more investors.

“One of the questions that we always have is ‘Is there an available market for all the developments we want to do? And when we look at our projects, we’re not only looking at Davao City but we’re looking at the neighboring cities as well,” Mr. Lagdameo said.

Projects in Damosa’s pipeline include the Bridgeport Park, Kahi Estates, Agriya Gardens and its condominium-hotel project under the TRYP brand.

“Looking at 2025, it’s going to be a busy year, but it will be another fruitful one.”

Mr. Lagdameo cited optimism about the Davao property market mainly due to local infrastructure projects that are expected to drive up property prices.

These include the modernization of the Davao International Airport and the public bus rapid transport system.

Infrastructure development is also expected to improve mobility in the area, Mr. Lagdameo said, adding that this would solve the province’s growing traffic problem.

“Over the next few years, the properties that will be developed here will really benefit from all of that.”

Another unique selling point of the Davao property market is its easy access to key areas like beaches and mountains, Mr. Lagdameo said.

“When you’re in Davao City, you can actually invest in, say, a beachfront property that’s very close to the city.”

In contrast, in Metro Manila, one needs to drive to nearby provinces like Cavite and Batangas to access beachfront properties, he pointed out. “The range of products here is very diverse and you can get it all within the same city.”

Mr. Lagdameo said residential projects are the strongest for Damosa, making up about 70-75% of its revenue. Commercial projects have contributed as much as 30% to revenue.

While the revenue share of commercial properties is less than its residential segment, these have helped bring in more foreign investors, business process outsourcing firms and factories in the Davao region, Mr. Lagdameo said.

He said Damosa would focus on the Mindanao property market’s untapped potential.

“As a group, we have properties in Metro Manila and in some other areas of Luzon… Those are properties that we’ll definitely be developing, just not in the near-term future,” he said. “We don’t just look at where the hot markets are. We create the markets.”

PHL builders to benefit from state infra spending

PHILIPPINE STAR/JOHN RYAN BALDEMOR

By Ashley Erika O. Jose, Reporter

LISTED Philippine construction companies are expected to deliver strong results in 2025 — an election year — driven by increased state infrastructure spending, analysts said.

“[Construction companies] are set for growth due to the country’s favorable demographics, as well as preparations for the May 2025 midterm elections especially before the election ban,” Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.

He said infrastructure projects are expected to be expedited before the Commission on Elections (Comelec) enforces a public works ban before the May 2025 elections.

He added that the expected rate cuts by the US Federal Reserve are expected to increase demand for loans from property developers and construction companies.

“Increased government infrastructure spending would benefit construction companies that are part of the supply chain of the various infrastructure projects around the country,” Mr. Ricafort said.

State infrastructure spending rose 2.52% in October from a year earlier, according to data from the Department of Budget and Management.

“Overall, the profitability outlook for 2025 appears cautiously optimistic, contingent on favorable economic policies and the execution of planned projects,” Toby Allan C. Arce, head of sales trading at Globalinks Securities and Stocks, Inc., said in a Viber message.

He said the profitability of construction and infrastructure companies in 2025 depend on factors such as government infrastructure spending, private sector projects and macroeconomic conditions.

“The Philippine government’s ongoing infrastructure development through different initiatives can stimulate demand for construction services,” he added.

But the growth of the sector is expected to be underpinned by raw material costs including steel and cement, which are influenced by global markets and foreign exchange volatility.

Megawide Construction Corp. returned to profit in the third quarter, posting an attributable net income of P142.7 million from a net loss of P29.85 million a year earlier. Revenue rose 10.9% to P5 billion.

EEI Corp. had an attributable net loss of P31.75 million in the third quarter from an attributable net income of P406 million a year earlier as gross revenue fell 27.8% to P3.14 billion.

Phinma Corp., which has a construction material unit, posted an attributable net income of P144.86 million in the third quarter, 75.1% lower than a year earlier, even as revenue rose 0.5% to P6.61 billion. Gross expense increased by 2.4% to P5.5 billion.

Rice importers urged to bring in more 25% broken-grain varieties

PHILIPPINE STAR/MICHAEL VARCAS

THE Department of Agriculture (DA) said rice traders need to set aside a portion of their imports to grain with 25% broken content, citing the need to lower rice prices.

“By importing more rice with 25% broken grains, we can significantly increase the availability of affordable rice options for Filipino consumers,” Agriculture Secretary Francisco P. Tiu Laurel, Jr. said in a statement on Sunday.

Rice traders typically bring in varieties with only 5% broken grains, which are priced significantly higher compared to the 25% broken grain variety.

According to DA price monitors, as of Jan. 2, a kilogram of well-milled rice fetched P42-P52 per kilo in Metro Manila markets, while regular-milled rice sold for between P38 and P40 per kilo.

The DA has expanded its Rice-for-All rolling stores in public markets across Metro Manila, through the Kadiwa ng Pangulo (KADIWA) program. The Rice-for-All program sells well-milled rice to the general public at P40 per kilo.

To date, 26 KADIWA rolling stores and kiosks are serving consumers in various public markets in the National Capital Region (NCR) and selected Metro Rail Transit and Light Rail Transit stations.

“In addition to the KADIWA rolling stores and kiosks, 40 KADIWA Centers in NCR and Bulacan are also operational. These centers regularly provide basic necessities and prime commodities (BNPCs), Rice-for-All, and P29 rice for vulnerable sectors,” the DA added.

The DA is looking to expand its KADIWA network to 1,500 locations by 2028. It is expecting to open 179 KADIWA Centers by the end of the year.

“While the DA is working closely with millers and importers to bring more affordable rice options, we remain dedicated to helping rice farmers increase their productivity and maintain their profitability, “Mr. Laurel added. — Adrian H. Halili

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