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Finance department says no plan to further raise sin tax rates

PHILIPPINE STAR/ MIGUEL DE GUZMAN

THE DEPARTMENT of Finance (DoF) is not planning to raise taxes on “sin” products but is closely looking into the mounting tax losses due to illegal importation of cigarettes.

“We will not impose any hike except for the existing [rates,]” Finance Undersecretary and Chief Economist Domini S. Velasquez said at a forum hosted by the Economic Journalists Association of the Philippines and San Miguel Corp. at the weekend.

The government imposes so-called “sin” taxes or excise taxes on certain goods such as alcoholic beverages and tobacco products in order to discourage consumption.

Ms. Velasquez said the DoF is not keen on increasing tax rates that may stoke inflation. Instead, she said the department is “really zeroing in on how to improve administrative efficiency.”

Signed into law in January 2020, Republic Act No. 11467 increased the excise tax on electronic cigarettes and alcoholic products to fund the Universal Health Care (UHC) law.

For instance, the ad valorem tax was increased to 22% of the net retail price of distilled spirits. The specific tax was raised to P42 per proof liter in 2020, to P47 per proof liter in 2021, to P52 in 2022, to P59 in 2023, and to P66 in 2024.

Under the law, the tax rate for tobacco products would be increased by 5% yearly starting Jan. 1, 2024.

“Higher sin taxes could lead to some increase in inflation but the weight in the inflation/CPI (consumer price index) basket is relatively smaller,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Facebook Messenger chat.

Excise tax collection contributes around 12% to the Bureau of Internal Revenue’s overall collection. Aside from alcohol and tobacco, excise taxes are imposed on petroleum and minerals, among others.

Data from the DoF showed the sin tax collection reached P65.3 billion in 2022, 23% higher than the previous year.

DoF’s Ms. Velasquez said the department is looking into the rampant smuggling of cigarettes into the country, which has resulted in millions in revenue losses for the government.

“One of the things being looked at is possibly illicit cigarette trade. This could possibly be one of the gaps in terms of tax collections,” Ms. Velasquez said in a Viber message.

Mr. Ricafort said the government should ensure “greater enforcement of the law also versus smuggling and other illegal activities that also reduce the government’s tax revenue collections.”

He said the government should strengthen measures against tax evasion, run after tax cheats, and encourage tax payment compliance.

Earlier this month, the BIR seized 227,351 packs of illicit cigarettes during a raid of warehouses in Brooke’s Point, Palawan. The BIR estimated the illegal importers of these cigarettes were responsible for P150.7 million in tax liabilities. — B.M.D.Cruz

Philippines implements single electronic invoicing system for imports

Trucks are seen in a container port in Manila, Philippines May 25, 2016. — REUTERS

THE PHILIPPINE government has enforced a single electronic invoicing system for all imported commodities, as it explores nonmonetary measures to address rising food prices.

Under Administrative Order (AO) No. 13 signed by President Ferdinand R. Marcos, Jr. on May 13, the country will implement digital and integrated pre-border technical verification and cross-border electronic invoicing for all imported commodities entering the country.

A single electronic invoicing system is necessary to “effectively monitor international trade transactions of all imported goods,” according to the order.

It would also “strengthen national security, safeguard consumers’ rights, and protect the environment against sub-standard and dangerous imported goods,” the order read.

The new system, which the Bureau of Customs (BoC) shall implement within two years, will be enforced gradually. The first phase covers agricultural goods including fresh and frozen meat, fish and other aquatic resources, cereals, fruits, vegetables, and feeds.

The second phase covers non-agricultural goods with health and safety issues, while the last phase will cover other goods with misdeclaration to avoid duties and taxes.

The AO also created a Committee for Pre-border Technical Verification and Cross-border Electronic Invoicing, which will be chaired by the Finance secretary.

The committee’s members include the secretaries of the departments of Agriculture, Trade, energy, Health, Environment and Natural Resources, and Information Communications Technology.

Committee members also include the BoC commissioner, director-general of Philippine Drug Enforcement Agency, and two non-voting representatives from duly recognized industry associations to be appointed by the chairperson upon the committee’s recommendation.

Funding for the order’s implementation would be charged against the available appropriations of the BoC and other members of the committee, according to the order.

The new system followed the issuance of an AO mandating the Agriculture department as well as the Trade and Finance agencies to further ease procedures for agricultural imports and remove non-tariff barriers.

Non-tariff barriers are policy measures that restrict trade such as quotas, import licensing systems, regulations and red tape, among others, according to AO 20.

Inflation accelerated for a third straight month to 3.8% in April from 3.7% in March. It also marked the fifth straight month that inflation settled within the BSP’s 2-4% target range.

Food inflation rose to 6.3% in April from 5.7% in March.

Inflation averaged 3.4% in the January-April period, below the central bank’s 3.8% full-year forecast. — Kyle Aristophere T. Atienza

DoF seen handling VAT claims in more ‘taxpayer-friendly’ way

DOF.GOV.PH

By John Victor D. Ordonez, Reporter

THE Department of Finance (DoF) Revenue Operations Group taking responsibility to handle value-added tax (VAT) refund claims may result in quicker processing and address delays under the Bureau of Internal Revenue (BIR), according to a tax professional.

“The experience of the taxpayers right now is that the BIR process is slow or tilted in favor of denying the tax refunds,” Eleanor L. Roque, tax principal of P&A Grant Thornton, said in a Viber message.

She said the DoF may employ more efficient and taxpayer-friendly measures in processing VAT claims, cutting down delays previously seen with the BIR.

Senator Sherwin T. Gatchalian has filed a bill proposing to transfer the responsibility of processing VAT refunds to the Revenue Operations Group from the BIR, which has fielded many complaints from companies with stalled refund claims.

Senate President Juan Miguel F. Zubiri has said the Japanese companies threatened to leave the Philippines after finding it difficult to secure refunds.

The American Chamber of Commerce of the Philippines, Inc. has said VAT refunds for jet fuel purchases take as long as five years to resolve.

Under the Senate bill, the Finance Secretary will be in charge of approving refund claims for creditable input taxes, instead of the internal revenue commissioner.

The measure also ensures businesses are entitled to a VAT zero-rating on local purchases, provided they operate at 70% capacity.

Registered export enterprises are also given duty exemptions on imports of raw materials and spare parts for capital equipment.

“The BIR’s task is to collect taxes so processing refunds or approving refunds is not ingrained in the BIR DNA,” Ms. Roque said. “It’s just against their interests to approve refunds.”

DoE could grant power plants bigger allowance for outages

PIXABAY

THE Department of Energy (DoE) said it is looking into allowing a longer plant shutdown period for maintenance.

“We should allow also the plants sufficient time to do their maintenance work. We’re comparing the amount of time that we allow the plants to undertake those,” Energy Secretary Raphael P.M. Lotilla told reporters last week.

Mr. Lotilla said cited the case of Japan, which allows longer maintenance periods.

“They will be able to take a deep dive to really inspect the different parts of the plant,” he said.

The reliability index implemented since 2020 allows the Energy Regulatory Commission (ERC) to set the maximum days of planned and unplanned outages per year, varying by generating plant technology.

A power plant that runs on pulverized coal can be out of operation for 44.7 days. This comprises 27.9 days of planned outages and 16.8 days of forced or unplanned outages.

A power plant running on circulating fluidized bed technology should not be out of service for more than 32.3 days —including 15.4 days of planned outage and 16.9 days of unplanned outage.

Geothermal plants are only allowed to be out for 19.7 days, with six days for planned outages and 13.7 days unplanned.

In 2023, the ERC imposed approximately P60 million worth of penalties against generation companies for exceeding their outage maximums.

“Preventive maintenance is very important. And just like in aircraft, you have to have regular maintenance to be carried out and enough time to carry out the maintenance,” Mr. Lotilla said.

Jose M. Layug, Jr. president of the Developers of Renewable Energy for Advancement, Inc., said that allowing power plants longer maintenance periods would “ensure that these aging power plants get the needed operational servicing for better performance.”

“While this may not solve the short-term supply issue, this may help the power plants perform better in the long run,” he said in a Viber message.

The ERC reported that five power generation companies exceeded the unplanned outage allowance as of April 30.

These are Masinloc unit 1 coal-fired thermal power plant and Sem-Calaca Power Corp. coal plant 2 in Luzon. 

In the Visayas, those exceeding the limits are the Mahanagdong geothermal power plant unit 2, Malitbog geothermal power plant unit 1, and Palm Concepcion Power Corp. unit 1. — Sheldeen Joy Talavera

11 sites operated by YTS ordered blocked for alleged piracy, copyright infringement

ELEVEN DOMAINS and subdomains operated by YTS have been issued site-blocking requests for alleged piracy and copyright infringement by the Intellectual Property Office of the Philippines (IPOPHL).

In a statement sent over the weekend, the intellectual property (IP) rights watchdog said that the 11 sites associated with YTS have violated Section 216 of the Intellectual Property Code of the Philippines and Memorandum Circular 23-025, or the Rules on Voluntary Administrative Site Blocking.

“A thorough examination reveals that all of the aforementioned websites are hosting pirated versions of movies or TV shows, allowing users to access these illegal copies by downloading them through links on the same website or by streaming them online,” according to the IPOPHL IP Rights Enforcement Office ruling.

The 11 sites — yts.mx, yts.rs, yts.do, ytsuproxy.to, yts.dirproxy.com, yts.unblocked.love, ytssss.jamsbase.com, yts.lt, yts.ag, yts.am, and torrents.yts.rs. — were found to have been using various methods to distribute copyrighted material.

“The websites under complaint are also listed in WIPO Alert, a data-sharing platform on piracy of the World Intellectual Property Organization,” IPOPHL said.

YTS is the official home of YIFY, “one of the world’s most prolific sites involved in the illegal replication and distribution of copyright content.”

“Millions of netizens visit this website, so this is a major win for the creative industry. We encourage more stakeholders to come forward, file a complaint, and further disrupt access to piracy websites,” IPOPHL Director General Rowel S. Barba said.

According to IPOPHL, the issuance stemmed from a complaint filed by the Motion Picture Association, which reported the site in 2015 to house 4,500 infringing motion picture titles.

“This site blocking order and forthcoming blocking actions will have a substantial impact on the Philippine piracy landscape. We will continue to work closely with the Philippines’ government and creative industry in the fight against the scourge of digital piracy,” the MPA said in a statement.

IPOPHL said that it has given the administrators of the sites five days to protest the decision as they could not be contacted before it served the site-blocking request to the National Telecommunications Commission (NTC) and internet service providers (ISPs) on May 14.

On May 16, the NTC issued a memorandum order directing all ISPs to immediately block the websites and report the actions they have taken within five days.

As of Saturday, the IPOPHL said that almost all signatories to the site-blocking memorandum of understanding (MoU) have cut access to the sites.

In September, IPOPHL signed an MoU with Globe Telecom, Inc., Smart Communications, Inc., PLDT Inc., Sky Cable Corp., and DITO Telecommunity Corp., which asks the ISPs to voluntarily block sites upon IPOPHL’s request. — Justine Irish D. Tabile

Employee-oriented strategies that make the Philippines’ leading and most trusted employers

Photo from Freepik

Company success is now measured not only by financial performance but also by its reputation as an employer. Leading organizations stand out by excelling in their industries while prioritizing employee well-being and fostering a culture of trust and support.

The focus on being a trusted employer has become a crucial factor in attracting and retaining top talent, driving innovation, and ultimately ensuring long-term and sustainable success. As businesses and employees adapt to these changes, several key trends are emerging, redefining how work is conceptualized, structured, and experienced.

As Statista’s Philippines’ Best Employers 2024 ranking reflect, the top companies in the country have successfully implemented strategies to attract and retain employees. These companies have demonstrated their commitment to creating a positive work environment, fostering employee growth, and building a strong company culture.

Importance of work-life balance

Achieving a harmonious balance between work and personal life is crucial for maintaining the well-being and productivity of employees in today’s work culture. It significantly impacts mental and physical health, job satisfaction, and overall quality of life across different industries.

McKinsey & Company’s report highlights that work-life balance and compensation are key factors affecting employee experience. Leading employees prioritize caring leaders, meaningful work, and safe workplace environments, emphasizing the importance of a holistic approach to employee satisfaction.

Recognizing the importance of work-life balance, top employers in the Philippines implement policies and initiatives that support their employees’ well-being. Companies like Google, Unilever, and Microsoft have implemented flexible work arrangements, generous leave policies, and wellness programs to support their employees’ physical and mental health.

The Gen Z and Millennial Survey by Deloitte also highlights that maintaining a positive work-life balance is a top consideration for these generations when choosing an employer. The survey indicates that flexible work options, such as part-time jobs and job-sharing, are highly valued by younger employees. It also addresses the impact of work-life balance on mental health and stress levels among employees.

A path to career growth

According to employee enablement platform Zavvy, replacing a trained employee can cost up to 200% of their annual salary — emphasizing the need for continuous training and development to retain valuable talent. Providing e-learning training opportunities can increase retention rates by 60%, as employees appreciate the flexibility and autonomy to learn at their own pace.

However, 59% of the employees claim to be self-taught, indicating a lack of formal training in many organizations. Only about one-third of employees are satisfied with their job-specific training, and one in three employees believe their company’s training processes are outdated.

Millennials, who now make up the majority of the active workforce, are eager for leadership training, with 60% of surveyed millennials expressing a desire for such opportunities. According to Global Leadership Forecast, effective leadership development programs as an inclusive approach to career development is 4.2 times more likely to outperform restrictive practices.

Despite this, less than 5% of companies implement leadership development universally, presenting a significant opportunity for improvement. The University of Phoenix’s Career Optimism Report highlights a significant concern regarding the lack of optimism about career development opportunities. According to the findings, 29% of workers express a lack of access to upskilling or training.

To address low employee engagement scores and growing disengagement, organizations must prioritize scalable and actionable employee development strategies, according to McKinsey. This includes having regular career development conversations, creating a short-term action plan, and ensuring transparent interactions.

Furthermore, redefining career development to focus on growth within current roles, rather than solely on promotions, can also help broaden development opportunities and cater to employee aspirations.

Redefining employee experience

Strong company culture and values are commonly linked to significant benefits for businesses. Companies that prioritize these aspects often find themselves at a competitive advantage, not only in terms of market performance but also in employee satisfaction, retention, and overall workplace harmony.

When employees feel aligned with their company’s values and culture, they are more engaged and motivated to perform at their best. Engagement drives productivity, as employees are more likely to go above and beyond in their roles, leading to higher efficiency and innovation.

According to Workhuman iQ data, the higher an employee rates their company culture, the lower the chances are that they will leave the organization. When organizations put company policies in place that elevate an employee’s experience, employees feel secure and supported in their role. This highlights the widespread recognition among employees of the pivotal role that company culture plays in organizational performance.

Respect, fairness, trust, integrity, and teamwork are the most important attributes of a strong company culture according to a survey by employee app Speakap. Sharing the organization’s mission, vision, and values has the greatest impact on employee alignment with the company culture. Moreover, ongoing job guidance and support also make employees feel more connected to the company.

According to the latest Philippines’ Best Employers, the Bureau of Fire Protection (BFP), the Supreme Court, and Maersk have built cultures that prioritize teamwork, collaboration, and a sense of purpose. These companies create a sense of belonging and shared mission that drives employee satisfaction and retention.

In addition, companies known for their strong culture and values attract top talent. Prospective employees are often drawn to organizations where they believe they will fit in and thrive. Additionally, a positive culture reduces turnover rates as employees are more likely to stay with a company where they feel valued and understood. This stability is beneficial for maintaining institutional knowledge and continuity within the organization.

In contrast, toxic workplace behavior is the biggest predictor of employee burnout symptoms and intent to leave, according to McKinsey. More than 60% of negative workplace outcomes are due to toxic workplace behavior.

According to a separate survey by the said professional services firm, almost two-thirds of employees stated that the COVID-19 pandemic prompted them to contemplate their life’s purpose, prioritize what is most important to them, and consider what is worth prioritizing. Although work plays a significant role in people’s lives, today’s employees are no longer willing to remain in unfulfilling jobs or work for employers that do not treat employees, people, or the planet well. — Mhicole A. Moral

First StartUp QC Student Competition celebrates entrepreneurial spirit among youth

Rise Rural Philippines wins the grand prize in the first Startup QC Student Competition.

By Mhicole A. Moral, Special Features and Content Writer

The Quezon City Government has celebrated the entrepreneurial spirit of student innovators through the first StartUp QC Student Competition, featuring 27 standout teams out of 39 finalists.

Held at the Matrix Creation Events Place in Barangay Pinyahan last May 16, the demo day provided a platform for student entrepreneurs to present their visions and projects across various sectors, such as sustainability, health, education, agriculture, and governance.

The competition aimed to encourage and nurture the next generation of entrepreneurs, fostering a culture of innovation and problem-solving within the student community.

The team Rise Rural Philippines, made up of students from the University of the Philippines Los Baños, Pamantasan ng Lungsod ng Maynila, and Ateneo de Manila University, has won the grand prize of P100,000 for their healthcare and energy solutions.

They developed the Araw-Kalinga Box (AKB), a multifunctional device integrating a solar-powered ultrasound machine, a cold box for vaccine storage, and a compartment for medical instruments. The AKB represents a paradigm shift in healthcare delivery, particularly in Geographically Isolated and Disadvantaged Areas (GIDA), where access to medical facilities and resources is often limited.

In an interview, Mark Virgil Jamel, founder and chief executive officer of Rise Rural Philippines, shared his personal motivation that sparked the idea: “Because my mother is a midwife, I grew up in a clinic and it kind of exposed me to the realities of healthcare access in rural communities.”

Rise Rural Philippines is currently operating in Siargao and Tanay, regions that struggle with inconsistent electricity.

“Most of the healthcare professionals in these areas, they have to move frequently from one place to another. It’s very difficult for them to carry their stuff around. With our backpack, it kind of gives an all-in-one solution for healthcare professionals to provide services to anyone, whether it’s in a rural community or urban when they’re doing house-to-house visits,” Mr. Jamel added.

As Rise Rural Philippines continues to develop, the team is focused on scaling their operations within the local communities.

“We’re still under the product development phase, hoping to finish that this year with the support of StartUp QC. We’re looking to gain more partnerships with NGOs and LGUs to sell more of these backpack units to more communities,” said Mr. Jamel.

ESEA, the second placer, received P75,000 for their project aimed at improving the fisheries supply chain. Their user-friendly mobile application connects Filipino fisherfolk directly with consumers. The idea was developed by students from Ateneo de Manila University (AdMU).

The third prize of P50,000 was awarded to NYHA Robotics, a team from the University of the Philippines. Their project promotes robotics education among children with an all-in-one learning kit and specialized robotics competition kits.

In addition to the major winners, other 24 teams received cash prizes across gold (two teams), silver (10 teams), and bronze (12 teams) categories, with each category securing P35,000, P25,000, and P15,000 respectively. In total, Quezon City awarded P725,000 to these talented student innovators.

Among the notable bucket winners was a group of senior high school students from the Philippine Science High School. Their project, the LakBike app, automates bicycle mobility utilization in Quezon City. The app allows cyclists to easily rent bicycles from popular areas within the city for use in designated bike lanes or other appropriate locations.

Jay Gatmaitan, head of Quezon City Local Economic Investment Promotions Office (LEIPO), was thrilled to host the grand finals of the very first StartUp QC Student Competition.

“In celebration of QC’s 85th founding anniversary this year, we are elevating our efforts and initiatives, especially for the youth, and the business community. Hopefully, these young citizens will be inspired to strive to build on their ideas after pursuing their studies, knowing that their government will support them to the best of its capacity,” he added.

The competition aims to develop students’ entrepreneurial skills through financial grants and mentorship sessions, providing a platform for young minds to showcase their innovative business ideas. Earlier this year, the QC LEIPO conducted a campus tour across Metro Manila to discover innovative and creative business ideas from senior high school to college-level students.

The StartUp QC program, an expansion of the local startup community in Quezon City, has partnered with various national government agencies, colleges, universities, and startup community members to support and nurture the entrepreneurial spirit among students. The student competition is open to students residing in Quezon City, aged at least 18 years old, and currently enrolled in any college or university in the Philippines.

“We believe that our students already have innovative ideas and the desire to make a meaningful impact in the world. It is our job in the city government to support them and help them make these concepts come to fruition,” said Quezon City Mayor Joy Belmonte.

Megaworld eyes P40-B real estate launches this year

ANDREW L. TAN-LED property developer Megaworld Corp. said it targets launching P40 billion worth of new real estate projects and achieving P145 billion in reservation sales this year.

“Looking ahead to 2024, we are setting an ambitious goal of reaching P145 billion in reservation sales and planning to launch new projects worth P40 billion,” Megaworld Chief Strategy Officer Kevin Andrew L. Tan said during the company’s virtual annual stockholders meeting last week.

Last year, Megaworld recorded P139.2 billion in reservation sales, up 17% from the prior year. It also launched P72.6 billion worth of new projects.

“These targets reflect our commitment to maintaining our leadership position and continuing to drive excellence in the industry,” Mr. Tan said.

Megaworld earmarked P55 billion for its capital expenditure budget this year to develop existing and upcoming townships, residential projects, investment properties, and land acquisition.

On its hospitality business, Mr. Tan said that Megaworld Hotels and Resorts is eyeing to add 4,100 room keys by 2029.

“This will further cement our position as the largest hotel developer in the Philippines. These expansions will significantly boost our capacity to meet the growing demand in the different locations across our country,” Mr. Tan said.

Megaworld said in a separate statement that it is now 100% carbon neutral across 52 company-owned malls and office developments nationwide.

Citing data compiled in partnership with Diligent, Megaworld reported that gross carbon emissions from its operational properties accounted for about 69,000 metric tons in 2023, 98% of which came from electricity consumption (scope 2), while the rest came from fuel consumption (scope 1).

Of the total, 51% came from Megaworld-owned mall developments, while the remaining 49% came from its office properties.

Megaworld was able to offset 36,000 metric tons of carbon emissions last year. It plans to use 100% renewable energy for all company-owned office and mall properties within the next three years.

Diligent is a software-as-a-service company specializing in governance, risk, and compliance.

“In the next 10 years, the company is committing to plant 3.5 million trees across over 1,000 hectares of carbon forests in Batangas, Cavite, Tarlac, Iloilo, Palawan, and Cebu,” Megaworld’s Sustainability Head Jose Arnulfo Batac said.

Megaworld said it will tap a third-party organization to further evaluate its sustainability efforts, particularly those centered on carbon neutrality.

“We look forward to achieving carbon neutral emissions for scopes 1 and 2 by 2035 for the entire Megaworld Group. We also turn our focus on accounting for our full Scope 3 emissions through our collaboration with our environmental, social, and governance data warehouse partner, Diligent, for a more ambitious target of achieving net zero by 2050,” Mr. Batac said.

“This is our way of continuing to champion our commitment to helping build a greener and cleaner future for everyone,” he added.

For the first quarter, Megaworld recorded an 8% increase in attributable net income to P4.4 billion as consolidated revenues surged by 16% to P18.87 billion.

Megaworld shares were last traded on May 17 at P1.81 per share. — Revin Mikhael D. Ochave

Figaro capex nears P1 billion, targets 400 stores

BW FILE PHOTO

LISTED restaurant operator Figaro Coffee Group, Inc. (FCG) said it has allocated close to P1 billion worth of capital expenditure (capex) budget for 2024, aiming to expand its presence with 400 stores across its brands within the next five years.

FCG Chairman Justin T. Liu said that at least P500 million of the capex budget will be used for store expansion across its brands.

“Within the next five years, hopefully, we aim to reach 400 stores,” Mr. Liu said on the sidelines of a media briefing last week.

He said that FCG aims for Angel’s Pizza to become the leading pizza brand in terms of store count and customer preference within the next five years.

“Hopefully within the next five years, we’ll be number one in customer preference and also store count. It is very challenging because our competitors are larger and heavier capitalized than us. It’s a very competitive market,” he said.

FCG currently has 207 stores consisting of 128 Angel’s Pizza branches, 65 Figaro Coffee branches, nine Tien Ma’s restaurants, four Café Portofino’s outlets, and one Koobideh Kebabs casual dining store.

The company is eyeing to open 70-80 new stores this year, of which half will be in Luzon.

Mr. Liu said that FCG is allocating more of its capex budget to the Angel’s Pizza brand since it is the company’s primary growth driver.

“That’s where a lot of the sales, earnings before interest, taxes, depreciation, and amortization, and profit are coming from and also the growth potential. We’re allocating more of the capital to where the growth is,” he said.

“We will still see double-digit growth for 2024 compared to 2023 because we have a lot of stores which are still under construction and we are still growing our store count,” he added.

Despite inflationary pressures, Mr. Liu said that there are no scheduled price increases across FCG brands.

“I think we’re seeing more of inflationary risks and on the cost of goods. Our consumers are also getting more budget conscious because interest rates have been high last year. It is still quite high now. People are having challenges with their personal finances and this translates to some more budget conscious spending,” he said.

For the third quarter of its fiscal year ending in June, FCG saw a 5% jump in its net income to P105 million as revenue surged by 27% to P1.3 billion.

The company’s January to December 2023 net income rose by 84% to P480.38 million while revenue improved by 55% to P5 billion.

FCG shares were last traded on May 17 at 72 centavos per share. — Revin Mikhael D. Ochave

Completion of SMC’s MRT-7 delayed on RoW issues in Bulacan segment — DoTr

Metro Rail Transit Line 7 (MRT-7)

THE METRO Rail Transit Line 7 (MRT-7) project of San Miguel Corp. (SMC) is experiencing delays due to right-of-way (RoW) issues,  particularly in San Jose del Monte, Bulacan, the Department of Transportation (DoTr) said.

“For the MRT-7, we are looking at operating the Quezon City leg by the last quarter of 2025, meaning the portion from Quezon Avenue. [The one] from North Avenue to Lagro,” Transportation Secretary Jaime J. Bautista told reporters on the sidelines of a forum last week. 

MRT-7, which will have 14 stations, will run from Quezon City to San Jose del Monte, Bulacan, and is expected to carry 300,000 passengers daily in its first year, and up to 850,000 passengers a day in its 12th year.

SMC is financing the construction and will operate the 23-kilometer commuter rail system after signing a 25-year concession agreement with the government.

Data from the Public-Private Partnership (PPP) Center showed that the project’s original target completion was set for 2019 but was later postponed to partial operation in the fourth quarter of 2021.

Just last year, the DoTr announced that the MRT-7 would commence operations by 2025.

“But the Bulacan part will not be completed by 2025 because [the MRT-7] has 14 stations. We’re hoping to operate by at least up to its 12th station by December of 2025,” Mr. Bautista said.

Its 13th station is expected to be operational “a year after,” Mr. Bautista noted.

The commuter rail line’s stations are Quezon North Avenue Joint Station, Quezon Memorial Circle, University Avenue, Tandang Sora, Don Antonio, Batasan, Manggahan, Doña Carmen, Regalado, Mindanao Avenue, Quirino, Sacred Heart, Tala, and San Jose del Monte.

Mr. Bautista said that the completion of MRT-7 is encountering RoW issues, specifically in the portion of San Jose del Monte City, Bulacan.

“There are oppositions there, they are saying it will cause heavy traffic flow. I actually had a meeting with the local government because we are really pushing for immediate resolution to the RoW issues,” he said.

He said the local government has requested to divert the station to another location.

“Because the area is too narrow, there is opposition from building owners. They provided us with options which we are going to study,” he said.

Once the RoW issues are resolved, the station in Bulacan will be operated between 2027 and 2028.

“We will study (the options provided). We are not in a hurry because our target is really to operate up to the Lagro station by 2025,” Mr. Bautista said.

In 2023, SMC announced that it has secured a P100 billion loan that is expected to hasten the construction of the MRT-7 project. — Ashley Erika O. Jose

Olympus acceleration platform opens global launchpad for Filipino Web3 startups

The DFINITY Foundation (DFINITY), a Swiss not-for-profit research and development organization and key contributor to the Internet Computer Protocol (ICP) blockchain, has announced the launch of the Olympus, the first decentralized, on-chain global acceleration platform.

Olympus provides a consolidated platform for launching Web3 products by providing grants, crowdfunding, VC investments, and networking opportunities all on-chain. The platform serves as a global ecosystem connector for over 40 countries, facilitating project applications, funding, talent acquisition, and cross-community interactions. It also promotes a transparent investment environment, giving investors early access to vetted projects.

Olympus’s initial operations are supported by a $15-million grant from DFINITY and the ICP Asia Alliance, which will operate the first series of Web3 startup accelerator programs. Within this framework, ISLA Camp (ICP Hub Philippines) will lead these efforts locally, spearheading the acceleration programs within the country to nurture and develop Filipino-led Web3 projects.

“Magandang oportunidad ang Olympus para makilala ang Filipino Web3 projects and entrepreneurs sa global stage. (Olympus opens global opportunities for Filipino projects and entrepreneurs.) Our focus at ISLA Camp is to identify, nurture, and propel high-potential Filipino Web3 projects onto the global stage,” said Nelson Lumbres, co-founder of ISLA Camp.

Filipino Web3 startups and entrepreneurs who will participate in Olympus will have access to mentorship and deal flows from top venture capital investors including Fenbushi Capital, Fundamental Labs, Softbank Vision Fund, NewTribe Capital, Cypher Capital, Bitcoin Frontier Fund, Summer Ventures, L2IV, Dext Force Ventures, Leadblock Partners, viaBTC Capital, Cipholio Ventures, Chiron Group, 3X Capital, Plutus.VC, and others.

“The Olympus acceleration platform promotes decentralization, innovation, and entrepreneurship. We’re all looking forward to witnessing the growth of the next generation of projects on the Internet Computer and other ecosystems through Olympus,” said Dominic Williams, founder and chief scientist of the DFINITY Foundation, in a statement.

By the end of 2024, Olympus will transition into a decentralized autonomous organization (DAO). To ensure its independence and sustainability, it will be funded through a native token generation event (TGE) followed by community-led fundraising, enabling all stakeholders to participate in the platform’s success.

Founders and developers wishing to participate in Olympus can submit their projects to the website www.dfinity.org.

IWG upbeat on PHL co-working space sector, points to high occupancy

MULTINATIONAL office solutions firm International Working Group plc (IWG) said it expects to have over 40 locations in the Philippines by the end of 2024.

“By the end of this year, we will have more than 40 locations, and last year we barely had 20. We are also by far the fastest growing, and the largest with our network here in the Philippines,” IWG Country Manager for the Philippines Lars Wittig said during a press briefing last week.

IWG recently launched four new centers in May, bringing the total spaces to 31. These include two Regus centers: one in Nepo Center, Angeles City, Pampanga, on May 6 and the Adriatico, Manila, on May 10. Meanwhile, the HQ Triumph building in Quezon City opened on May 14, and Spaces in PNB Makati on May 15.

According to Mr. Wittig, the investment cost for a new center is roughly $1 million, including the cost of amenities such as Wi-Fi connection, coffee maker, and more.

Moreover, these spaces will be concentrated in Metro Manila with 27 spaces, and three centers each in Pampanga and Davao. Baguio, Subic, Cebu, Iloilo, and Cagayan de Oro all have one, respectively. A center in Cavite will launch in November.

Mr. Wittig said he is bullish on the co-working space industry in the Philippines and noted IWG’s 85% minimum occupancy rate every single month for 18 months.

IWG’s expansion plans were driven by growing demand for the industry due to the employment boom while employers preferring to have less long-term office space in conventional settings, he said.

The company also cited the 2023 Asia Pacific Workforce Hopes and Fears Survey, which revealed that about 51% of Philippine respondents preferred the hybrid work model. This preference coincides with rising foreign investment, strong gross domestic product figures, and the growing affluence in the trend.

“In COVID, [employers] learned the hard way that once you sign a lease for five or 10 years and make a big capital investment to fill it,” he said, while noting that employers do not stand a realistic chance of truly knowing what their workspace requirements will be in the future.

He also said that relatively smaller businesses find leasing requirements overwhelming and expensive when dealing with traditional landlords.

“While the whole real estate market for commercial office space might look a little bit bleak, the shining star in it all is flexible workspace as a service,” he said.

Globally, IWG leads the flexible workspace industry, with almost 10 million customers in 4,000 locations across more than 120 countries. — Aubrey Rose A. Inosante

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