TRAVELERS walk with their suitcases at Beijing Daxing International Airport in Beijing, China April 24, 2023. — REUTERS
TRAVEL by rail and car across China surged on Wednesday, the first day of a major public holiday, as consumers remained focused on keeping expenses down in a challenged economy.
In the run-up to the five-day holiday that began with May Day, domestic airline fares were falling and forecasts suggested more travelers were opting to drive rather than fly, or had booked early to save.
Travel of all kinds has rebounded since China lifted strict COVID control measures at the end of 2022, but consumer spending on those trips has failed to keep up, limiting the boost to the broader economy.
China has set an economic growth target for 2024 of around 5%, which many analysts say will be a challenge to achieve without much more stimulus.
China’s manufacturing and services activity both expanded at a slower pace in April, official surveys showed on Tuesday, suggesting some loss of momentum.
“There is indeed significant pressure,” Lin Yu, 38, who was visiting Beijing from Hangzhou. “Every family’s situation is different, and it clearly also depends on the industry you work in.”
By the fourth week of April, the average price for an economy flight in China had dropped 38% from the first week of the month to the equivalent of just under $97, according to VariFlight, an aviation data service provider.
“Chinese airlines must adapt to these changes,” said Zheng Hongfeng, VariFlight, who said the fare declines showed travelers were booking early in a highly competitive market.
About 58 million cars are expected to be on roads every day during the holiday while railways carried more than 20 million passengers on Wednesday alone, state media reported.
The number of trips taken during the first quarter was up almost 17 percent from a year earlier, according to state broadcaster CCTV.
A three-day public holiday during April was the first-time average spending per trip rose beyond 2019 levels. By that measure, spending was up then just over 1%.
Some companies have shifted to try to appeal to consumers watching their spending as they watch the road.
Yum China, the operator of KFC in China, said this week 30% of its new stores would be in lower-tier cities or roadside locations like highway rest stops.
Same-store sales at those locations were up 20% during Lunar New Year in February, Yum China chief executive officer Joey Wat said.
“They’re key to capturing the spike in travel volume during holidays,” she said. — Reuters
TOKYO — Corporate Japan is starting to wonder if the weak yen has become too much of a good thing.
The currency fell to a 34-year low on Monday and has lost about a quarter of its value against the surging U.S. dollar in a little more than two years.
Typically, a weak yen is seen as a boon for Japan Inc, as it makes cars and other goods cheaper overseas and lifts profits when earnings from abroad are brought home.
But it has also pushed up costs of raw materials, food and fuel, battering sectors from farmers who import fertilizers to small manufacturers which rely on parts from China.
The biggest squeeze has been for households, which for years have seen little wage growth. Their plight — and that of Japan’s legions of struggling small businesses — may say more about the state of the country’s still-limping economy than the windfall for exporters such as Toyota Motor or the stock market’s climb to a record high.
Smaller firms employ seven out of 10 workers in Japan, and have less ability to pass on rising costs by raising their selling prices in a competitive market.
“The yen is a little too weak,” the chairman of the powerful Keidanren business lobby, Masakazu Tokura, told a regular press conference last week, days before Monday’s sell-off briefly pushed the currency past 160 to the dollar.
Current currency levels beyond 150 to the dollar did not represent the “true strength of Japan’s economy” he said.
Japanese authorities likely intervened in the market to put a floor under the yen on Monday, traders said, a supposition borne out by Bank of Japan data a day later, but it is expected to remain weak as long as the U.S. Federal Reserve keeps interest rates high.
The yen was around 157.91 to the dollar on Wednesday.
A more “comfortable” level would be 125 to the dollar, Koji Shibata, the head of ANA Holdings, which runs Japan’s top airline, recently told reporters.
While airlines enjoy a surge of inbound tourists drawn by the weak yen, more Japanese now baulk at going abroad.
“The currency is handicap for those who want to travel overseas. The higher costs abroad are a big turn-off,” Shibata said.
Rival Japan Airlines may need to raise prices, mainly on international routes, if surcharges and currency hedging aren’t enough to offset escalating fuel costs that stem from a weaker yen, President Mitsuko Tottori recently told a media roundtable.
An exchange rate of around 130 to the dollar would be better for the airline, she said.
‘NO MERIT’ If seen as a proxy for the strength of the broader economy, then the yen presents a worrying view, a point that’s repeatedly made by Tadashi Yanai, Japan’s richest man and the founder of Fast Retailing, the parent company of the Uniqlo clothing chain.
Yanai has said the weak yen has “no merit” for a country that imports raw materials from all over the world, and processes and adds value to them before selling.
He has stuck to that stance even as the currency has boosted Uniqlo’s overseas earnings. The retailer has a substantial overseas business, with China its biggest foreign market.
Excessive weakening in the yen could have an impact on the Japanese economy, Tokyo Gas Chief Financial Officer Taku Minami told a press conference last week.
That in turn could have an effect on the utility’s business, he said.
Managers also say that regardless of the boost to profits, the currency’s volatility makes it more difficult to plans for the future.
“Depreciation does provide some benefit for us to be candid, but longer term it does increase the instability in our supply chain, in the business environment itself,” Eric Johnson, the chief executive of chip materials maker JSR told a press conference on Tuesday.
“As most business leaders, I think what’s most important is we look for stability and predictability.”
CONSERVATIVE FORECASTS Japanese automakers have long been known for sticking to conservative currency forecasts.
“Given the unpredictability of forex rates, there is a natural tendency to want to avoid being overly bullish in forecasts, and be embarrassed later,” said Christopher Richter, senior Japan autos analyst at brokerage CLSA.
“If you go back historically, this is almost always the way.”
Toyota had estimated a rate of 143 yen to the dollar in the financial year just ended. It is due to release full-year earnings next week.
Since a 1-yen change against the dollar means a difference of 50 billion yen ($317 million) in profit for Toyota, taking a conservative view is more prudent, said Koji Endo, head of equity research at SBI Securities, adding that most automakers have set their forecasts at around 140-145 yen to the dollar.
For years Japanese manufacturers have been building up overseas operations, which has helped offset some of the yen’s impact.
The weak yen is unlikely to dissuade automakers from investing more in overseas markets, Endo said.
“It is not the currency rate, but changes in another country’s regulations, or political situation, that may cause a change” in investment, he said.
“The exchange rate has little to do with it.” — Reuters
In photo: Dr. Brian Poe-Llamanzares at the Asia Pacific Congress 2024 Ministerial Meeting
Dr. Brian Poe-Llamanzares was invited to speak at the Asia Pacific Ministerial Forum alongside representatives from the Department of Budget and Management Undersecretary Maria Francesca del Rosario and Department of Information and Communications Technology Assistant Secretary Maria Teresa Camba. Together, they represented the Legislative and Executive branch efforts of the Philippines to address the digital divide.
Mr. Poe-Llamanzares explains that addressing the digital divide requires a whole-of-government approach. “When we talk about expanding the digital economy of the Philippines, we need the Executive and Legislative branches working hand-in-hand with internet service providers in order to make quality internet access available to all.”
In photo: Senate Offices of Grace Poe, Pia Cayetano, and Nancy Binay represented by (left to right) Michelson Panganiban, Ria Herrera, Dr. Brian Poe-Llamanzares, Samuel Porcalla, and Hannah Guico
He also mentioned how Senator Grace Poe is doing her part as Chair of the Senate Committee on Public Services. He gave three clear examples:
The passage of the amendments to the Public Service Act (11659) in March 2022, allowing up to 100% foreign ownership of public services, including telecommunications, aims to foster competition, improve service quality, and support digital transformation projects in the country.
The filing of the “Better Internet Act,” which requires all public telecommunications entities and internet service providers to expand service coverage in unserved and underserved areas. Further, the bill provides a minimum standard for internet connection speed.
The filing of the “Open Access in Internet Act”, which shall promote the construction and development of reliable, affordable, secure, open and accessible Internet networks by providing for an expedited administrative process for the qualification and registration of Internet network and service providers. Unless they will operate an international cable landing station, ISPs shall not be required to secure a legislative franchise, Provisional Authority, or a Certificate of Public Convenience and Necessity or CPCN from the NTC in order to build, install, operate, and render Internet network and Internet access services.
Mr. Poe-Llamanzares also highlighted the National Fiber Backbone (NFB) project, explaining that it is crucial for economic transformation, and aims to bring high-speed internet access to 14 provinces, two National Government Data Centers, and four BCDA ecozones. The NFB Program covers 28,000 kilometers of fiber that will connect the Islands of Luzon, Visayas and Mindanao.
In photo (left to right): Department of Information and Communications Technology Assistant Secretary Maria Teresa Camba; Dr. Brian Poe-Llamanzares, Chief-of-Staff of Senator Grace Poe; and Department of Budget and Management Undersecretary Maria Francesca del Rosario
Dr. Brian Poe-Llamanzares serves as Chief-of-Staff of Senator Grace Poe and has previously written his PhD dissertation on the National Broadband Plan and submitted his findings to DICT Secretary Ivan Uy back in 2022. He has a PhD in Public Administration.
Present at the ministerial meeting were Dr. Piti Srisangnam, Executive Director, ASEAN Foundation; Simon Lin, President of Huawei Asia-Pacific Region; General (Ret.) Dr. Moeldoko, Chief-of-Staff of the President of the Republic of Indonesia; Professor Wisit Wisitsora-at, Permanent Secretary of the Ministry of Digital Economy and Society, Thailand; H.E. Keo Sothie, Secretary of State, Ministry of Post and Telecommunications, Kingdom of Cambodia; Dr. Dave Akbarshah Fikarno, M.E., Member of the House of Representatives of the Republic of Indonesia; Md Ataur Rahman Khan, Additional Secretary, Information and Communication Technology Division, Bangladesh; and Sivaram Superamanian, Assistant Director of Digital Economy Division, the ASEAN Secretariat.
Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.
Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.
Abhishek Bhatia (left), Founder and Chief Executive Officer of the Oona Insurance group; together with Winsely Bangit (right), GCash’s VP and Head of New Businesses Group
Philippines’ GCash and Oona Insurance Philippines have entered into partnership that will benefit all Filipino travelers.
The new partnership was formally made after the signing of the Memorandum of Agreement between Winsely Bangit, GCash’s VP and Head of New Businesses Group; and Abhishek Bhatia, Founder and Chief Executive Officer of the Oona Insurance group held last April 24, 2024 at Seda Hotel in BGC, Taguig City.
Under the agreement, Oona Insurance’s game-changing product — the Smart Flight Delay Insurance — will now be accessible and available in the GCash app, through its GInsure Marketplace. The Smart Flight Delay provides travelers access to airport lounges if their flight gets delayed for at least 60 minutes. Availability of this product is very easy as passengers can get this insurance coverage at least two hours before their scheduled flights from just a few taps in the GCash app. This new product reduces Filipino travelers’ discomfort due to delayed flights, making their experience more convenient and stress-free.
“This agreement with Oona Insurance Philippines is very timely now that the summer season is on. We expect a lot of our GCash users to travel to many destinations and for them to have insurance coverage against a real pain point, in what is supposed to be an exciting and much anticipated trip, is definitely a game-changer,” said Winsley Bangit, GCash’s VP and Head of New Businesses Group.
With GCash being the #1 e-wallet and the Philippines’ only double unicorn with more than 81 million users, and its new partnership with Oona Insurance, both are at the forefront in creating customer-centric innovations, introducing game-changing products like Smart Flight Delay, and making insurance protection easily accessible to millions of Filipinos who travel — all while ensuring a seamless experience to its users.
“GCash is a beloved brand and an integral part of every Filipino’s daily life and has made financial services simple, secure, and smooth. We are delighted to make our innovative travel insurance product available on GCash to bring worry-free travel to more Filipinos as they explore the world. This is the first of many such innovative products we will be introducing soon,” said Abhishek Bhatia, Founder and Chief Executive Officer of the Oona Insurance group.
Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.
Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.
U.S. President Joe Biden holds a campaign rally ahead of the state’s Democratic presidential primary, in Las Vegas, Nevada, U.S. Feb. 4, 2024. — REUTERS
WASHINGTON – President Joe Biden said on Wednesday that “xenophobia” from China to Japan and India is hobbling their growth, as he argued that migration has been good for the US economy.
“One of the reasons why our economy’s growing is because of you and many others. Why? Because we welcome immigrants,” Mr. Biden said at a Washington fundraising event for his 2024 re-election campaign and marking the start of Asian American, Native Hawaiian and Pacific Islander Heritage Month.
“Why is China stalling so badly economically, why is Japan having trouble, why is Russia, why is India, because they’re xenophobic. They don’t want immigrants. Immigrants are what makes us strong.”
The International Monetary Fund forecast last month that each country would see its growth decelerate in 2024 from the year prior, ranging from 0.9% in highly developed Japan to 6.8% in emerging India.
They forecast that the United States would grow at 2.7%, slightly brisker than its 2.5% rate last year. Many economists attribute better-than-expected performance partly to a migrants expanding the country’s labor force.
Concern about irregular migration has become a top issue for many US voters ahead of November’s presidential election.
Mr. Biden, who has condemned the rhetoric of his Republican opponent Donald Trump as anti-immigrant, has worked to court broad economic and political relations with countries including Japan and India to counter China and Russia globally. – Reuters
TAIPEI – It will be hard for Taiwan to attend this year’s World Health Organization annual assembly, and it hopes more countries will support its presence, the island’s foreign minister said on Thursday after the United States pressed for an invite.
Taiwan is excluded from most international organizations because of objections by China, which considers the democratically governed island its own territory.
Taiwan attended the World Health Assembly (WHA) as an observer from 2009 to 2016 under the administration of then-President Ma Ying-jeou, who signed landmark trade and tourism agreements with China. But Beijing began blocking Taiwan’s participation in 2017 after President Tsai Ing-wen won office.
Speaking to reporters in parliament, Taiwan Foreign Minister Joseph Wu noted a Wednesday statement from US Secretary of State Antony Blinken in which he said the United States “strongly encourages” the WHO to reinstate Taiwan’s invitation.
“When it comes to attending this year’s WHA there may be some difficulties, but we are continuing to work hard, as before, to get more countries to support us,” Wu said, without elaborating on those problems.
This year’s WHA starts May 27, just a week after Taiwan president-elect Lai Ching-te takes office. China has a strong dislike of Lai, who it believes is a dangerous separatist and has rebuffed his repeated calls for talks.
Taiwan, which is allowed to attend some technical WHO meetings, says its exclusion hindered efforts to fight the COVID-19 pandemic.
Mr. Blinken’s statement said the United States commended the WHO for taking steps to engage Taiwan more meaningfully in its technical work over the past year and for improving lines of communication.
“Yet Taiwan’s continued exclusion from this preeminent global health forum undermines inclusive global public health cooperation and security,” he added. “Inviting Taiwan to observe the WHA is a critically important step toward affirming the WHO’s goal of ‘Health for All’.”
Neither China’s foreign ministry nor the WHO immediately responded to a request for comment.
China has in recent years ramped up diplomatic and military pressure against Taiwan to force the island to accept Chinese sovereignty.
Taiwan’s government rejects China’s claims and says only the island’s 23 million people can decide their future, and that Beijing has no right to speak for or represent Taiwan on the international stage. – Reuters
NEW YORK – Johnson & Johnson said on Wednesday it is moving forward with a $6.48 billion proposed settlement of tens of thousands of lawsuits alleging that its baby powder and other talc products contain asbestos and cause ovarian cancer.
The deal would allow it to resolve the lawsuits through a third bankruptcy filing of a subsidiary company, J&J said.
J&J will begin a three-month voting period in hopes of reaching consensus on a settlement of all current and future ovarian cancer claims. Those claims account for 99% of the talc-related lawsuits filed against J&J, including about 54,000 centralized in a New Jersey federal court proceeding.
Courts have rebuffed J&J’s two previous efforts to resolve the lawsuits through the bankruptcy of the subsidiary created to absorb the company’s talc liability, ruling that the company was not eligible for bankruptcy protection because it was not in “financial distress.”
J&J, which says its products do not contain asbestos and do not cause cancer, said its settlement is supported by attorneys representing the majority of plaintiffs who have filed cancer lawsuits against the company.
Erik Haas, J&J’s worldwide vice president of litigation, said gathering votes before a bankruptcy filing would allow the new plan to succeed where J&J’s past efforts faltered.
“The claimants get to vote, and that’s the major difference here,” Haas said in a Wednesday call with investors, referring to legal challenges that resulted in courts dismissing J&J’s previous subsidiary bankruptcy filings before the ballot stage.
J&J said it is confident the deal will garner support from the 75% of outstanding claimants needed for a bankruptcy settlement that would end the litigation entirely, including future lawsuits, and prevent people from opting out of the deal to pursue separate claims.
Attorneys representing cancer victims seemed divided on the proposal.
“I believe J&J’s proposed plan announced today will bring peace and closure to our clients and the thousands of women who have fought by our side in the quest for justice,” said Jim Onder, who represents about 21,000 talc claimants and who supported J&J’s previous bankruptcy proposal.
Other lawyers said J&J is trying to “stuff the ballot box” by getting votes from lawyers who have not sued J&J or whose clients have types of gynecological cancers lacking a strong scientific link to talc.
Mike Papantonio, an attorney opposed to the deal, said J&J has been “covertly soliciting law firms to accept their deal, promising a swift payday for some opportunistic lawyers.”
J&J’s Haas rejected the assertions about padding the vote with non-ovarian cancer cases, saying they were “baseless and no more than a red herring.”
The proposed deal would build on J&J’s settlements with about 95% of people who have sued the company after developing mesothelioma, a rare form of cancer linked to asbestos exposure, as well as its settlements with U.S. states that alleged the company failed to warn consumers about the dangers of its talc products.
$11 BILLION IN RESERVES
J&J said it reserved $11 billion to account for all of its talc settlements, which included resolving claims outside of bankruptcy proceedings from state attorneys general and people alleging asbestos-tainted talc caused their mesothelioma. The company also resolved claims in the bankruptcies of its talc suppliers.
In its second subsidiary bankruptcy filing, J&J proposed paying $8.9 billion to resolve ovarian cancer, mesothelioma and state claims. This time, J&J opted to address what Haas estimated were up to 100,000 ovarian cancer claims in bankruptcy while resolving others in traditional settlements.
The previous bankruptcy filings put the talc litigation on hold from 2021 to 2023, but trials have resumed after a federal judge ruled the latest bankruptcy case should be dismissed in July 2023.
In March, J&J received a new chance to contest the scientific evidence linking talc to ovarian cancer in the centralized litigation in New Jersey federal court. The judge overseeing the cases said recent changes in the law and new scientific evidence require a fresh review, and asked J&J to present new arguments on the science by late July.
J&J said it will continue to defend itself against the lawsuits while trying to gather votes on the settlement. The company said it has prevailed in 95% of ovarian cases tried to date, including every one tried over the last six years.
The litigation has resulted in some large verdicts for plaintiffs, including a $2.12 billion award in favor of 22 women who blamed their ovarian cancer on asbestos in J&J talc. In the past month, J&J was ordered to pay $45 million in a mesothelioma case while winning an ovarian cancer case.
J&J has stopped selling talc-based baby powder in favor of cornstarch-based products, citing an increase in lawsuits and “misinformation” about the talc product’s safety. – Reuters
Flags fly over the US Federal Reserve building in Washington, US, May 26, 2017. — REUTERS
WASHINGTON – The US Federal Reserve held interest rates steady on Wednesday and signaled it is still leaning towards eventual reductions in borrowing costs, but put a red flag on recent disappointing inflation readings that could make those rate cuts a while in coming.
Indeed, Fed Chair Jerome Powell said that after starting 2024 with three months of faster-than-expected price increases, it “will take longer than previously expected” for policymakers to become comfortable that inflation will resume the decline towards 2% that had cheered them through much of last year.
That steady progress has stalled for now, and while Powell said rate increases remained unlikely, he set the stage for a potentially extended hold of the benchmark policy rate in the 5.25%-5.50% range that has been in place since July.
U.S. central bankers still believe the current policy rate is putting enough pressure on economic activity to bring inflation under control, Powell said, and they would be content to wait as long as needed for that to become apparent – even if inflation is simply “moving sideways” in the meantime.
The Fed’s preferred inflation measure – the personal consumption expenditures price index – increased at a 2.7% annual rate in March, an acceleration from the prior month.
“Inflation is still too high,” Powell said in a press conference after the end of the Federal Open Market Committee’s two-day policy meeting. “Further progress in bringing it down is not assured and the path forward is uncertain.”
Powell said his forecast remained for inflation to fall over the course of the year, but that “my confidence in that is lower than it was.”
Whether there are rate cuts this year or not remains in doubt.
“If we did have a path where inflation proves more persistent than expected, and where the labor market remains strong but inflation is moving sideways and we’re not gaining greater confidence, well, that would be a case in which it could be appropriate to hold off on rate cuts,” Mr. Powell said. “There are paths to not cutting and there are paths to cutting. It’s really going to depend on the data.”
Despite the uncertainty of the current economic moment, Powell’s characterization of rate hikes as “unlikely” cheered investors concerned about a newly hawkish Fed chief.
US stock and bond prices turned higher as Powell preached patience that may delay rate cuts, but also means a high bar for any more hikes. The Fed raised its benchmark policy rate by 5.25 percentage points in 2022 and 2023 to curb a surge in inflation.
Mr. Powell’s remarks on Wednesday were “notably less hawkish than many feared,” said analysts at Evercore ISI. “The basic message was that cuts have been delayed, not derailed.”
Investors in contracts tied to the Fed’s policy rate increased bets that rate cuts could begin in September rather than later in the year as reflected in earlier market pricing.
BALANCE SHEET
The Fed’s latest policy statement kept key elements of its economic assessment and policy guidance intact, noting that “inflation has eased” over the past year, and framing its discussion of interest rates around the conditions under which borrowing costs can be lowered.
“The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably towards 2%,” the Fed repeated in its unanimously-approved statement.
That continues to leave the timing of any rate cut in doubt, and Fed officials made emphatic their concern that the first months of 2024 have done little to help the cause.
“In recent months, there has been a lack of further progress towards the Committee’s 2% inflation objective,” the Fed said in its statement.
The US central bank also announced it will scale back the pace at which it is shrinking its balance sheet starting on June 1, allowing only $25 billion in Treasury bonds to run off each month versus the current $60 billion. Mortgage-backed securities will continue to run off by up to $35 billion monthly.
The step is meant to ensure the financial system does not run short of reserves, as happened in 2019 during the Fed’s last round of “quantitative tightening.”
While the move could loosen financial conditions at the margin at a time when the US central bank is trying to keep pressure on the economy, policymakers insist their balance sheet and interest rate tools serve different ends.
The Fed maintained its overall assessment of economic growth, saying that the economy “continued to expand at a solid pace. Job gains have remained strong and the unemployment rate has remained low.”
Mr. Powell reconciled that with the relatively weak, 1.6% growth of gross domestic product in the first quarter by saying that the 3.1% increase in private domestic demand was a better gauge of where the economy stands, with output buttressed by a recent jump in immigration.
Asked about the risk the US was entering a period of “stagflation” with stagnant growth and rising prices, Powell said current conditions are nothing like those seen in the late 1970s when prices were rising more than 10% annually at one point alongside high unemployment.
“Right now we have … pretty solid growth … We have inflation running under 3%,” Mr. Powell said. “I don’t see the ‘stag’ and I don’t see the ‘flation.'” – Reuters
President Joe Biden and former President Donald Trump will face each other in the US presidential election on Nov. 5 in what looks set to be a divisive, closely fought contest. Several third-party hopefuls are also running.
Here is a list of the candidates:
DONALD TRUMP
Republican presidential candidate and former U.S. President Donald Trump attends a campaign event in Waterloo, Iowa, U.S. Dec. 19, 2023. — REUTERS
Mr. Trump, in office from 2017-2021, has secured enough delegates to clinch the Republican nomination, setting up the first presidential rematch in nearly 70 years.
He has leveraged his unprecedented legal challenges to solidify support among his base and has cast his third bid for the White House in part as retribution against perceived political enemies.
He calls supporters jailed for the Jan. 6, 2021, attack on the US Capitol “hostages” and campaigns using increasingly dystopian rhetoric, refusing to rule out possible violence around the Nov. 5 contest.
Mr. Trump, 77, faces 88 charges in four criminal cases over efforts to subvert the 2020 election as well as unlawfully keeping classified national security documents and falsifying business records. His first criminal trial began in New York on April 15.
He has called the criminal charges a Democratic conspiracy designed to keep him from winning, with some of his legal challenges reaching the US Supreme Court. The US Justice Department denies any political interference.
Mr. Trump has made immigration his top domestic campaign issue, declaring he would carry out mass deportations, create holding camps, utilize the National Guard and possibly federal troops, end birthright citizenship, and expand a travel ban on people from certain countries. He has referred to migrants as “animals” and has not ruled out building detention camps on U.S. soil.
On abortion, Mr. Trump takes credit for the US Supreme Court ruling overturning Roe v. Wade, and in April said abortion should remain a state issue. While he has criticized some Republican-led state actions such as Florida’s six-week abortion ban and Arizona’s revived Civil War-era ban, he said he would allow Republican-led states to track women’s pregnancies and prosecute those who violate their state bans.
He has promised sweeping changes that included eliminating Obamacare health insurance before saying in an April 11 video that he would not “terminate” it. He has also vowed to undo much of the Biden administration’s work to fight climate change.
Mr. Trump has yet to announce a vice presidential running mate, but several possibilities have been floated. Mike Pence, who ran alongside Trump in 2016 and 2020 but was targeted by Trump and his supporters amid the Jan. 6 attack, refused to endorse him in November’s contest.
DEMOCRATIC PARTY
JOE BIDEN
US PRESIDENT JOSEPH R. BIDEN — WHITEHOUSE.GOV
Mr. Biden launched his 2020 candidacy as an urgent bid to defend American liberties and protect democracy and has cast his reelection bid in the same light, saying Trump threatens the future of American democracy.
Mr. Biden faced no serious challenger for the party’s nomination, which he clinched in March.
November’s election will be much tougher, with the most recent Reuters/Ipsos poll putting Biden’s voter support slightly ahead at 40% of registered voters, 1 percentage point ahead of Trump’s 39%.
Mr. Biden, already the oldest US president ever at 81, must convince voters he is more fit for office than Trump, who is just four years younger, while also combating low approval ratings.
The economy will also factor in his reelection campaign. While the US escaped an anticipated recession and is growing faster than economists expected, inflation and the cost of essentials are weighing on voters.
Mr. Biden pushed through massive economic stimulus and infrastructure spending packages to boost US industrial output, but has received little recognition from voters so far as his campaign moves to highlight new semiconductor manufacturing plants, housing plans, and other economic efforts.
Mr. Biden’s handling of immigration policy has also been criticized by Republicans and Democrats as migrant crossings at the US-Mexico border hit record highs.
He has led the response of Western governments to Russia’s invasion of Ukraine, persuading allies to punish Russia and support Kyiv.
Mr. Biden has provided military aid to Israel in its conflict with Hamas in Gaza while pushing for more humanitarian assistance, but he has faced sharp criticism from some Democrats for not pushing harder for a ceasefire or matching his tougher rhetoric on Israel with action. Intensifying U.S. student protests over the war in Gaza also could weigh on his reelection bid, with some organizers behind the “uncommitted” movement siphoning some support from Biden in the primaries, seeking to join up with campus protesters.
Best-selling author and self-help guru Marianne Williamson, 71, relaunched her long-shot 2024 presidential bid focusing on “justice and love” less than one month after dropping out.
In a February statement, she said she was getting back in to fight Mr. Trump’s “dark and authoritarian vision” after earlier suspending it because she was losing “the horse race.” Williamson previously ran as a Democrat in the 2020 presidential primary but dropped out of that race before any votes were cast.
INDEPENDENTS
ROBERT F. KENNEDY JR
An anti-vaccine activist and environmental advocate, Kennedy, 70, is running as an independent after initially challenging Biden for the Democratic nomination.
While he lags in overall polling, Mr. Kennedy could siphon votes from Mr. Trump and Mr. Biden, with the latest Reuters/Ipsos poll showing he was backed by 8% of registered voters, a seven-percentage-point drop from March.
The son of US Senator Robert F. Kennedy, who was assassinated in 1968 during his own presidential bid, Kennedy has drawn rebukes from his famous family, which has publicly backed Biden.
Mr. Kennedy, who chose wealthy lawyer Nicole Shanahan as his running mate, supports Israel and has questioned a six-week ceasefire backed by Biden.
He said he views the US southern border situation as a humanitarian crisis and opposes Mr. Trump’s border wall. He has also vowed to repeal parts of Mr. Biden’s climate bill over tax breaks he says help the oil industry.
On health, Mr. Kennedy has taken different positions on abortion. He has been criticized for making false medical claims over the years on vaccines but says he would still allow Americans to have access to them.
Mr. Kennedy faces a challenging and costly battle to get on the ballot in all 50 states and is listed in California, Michigan and Utah so far.
CORNEL WEST
The political activist, philosopher and academic is running as a third-party bid for president that is likely to appeal to progressive, Democratic-leaning voters.
Mr. West, 70, initially ran as a Green Party candidate but, in October, he said people “want good policies over partisan politics” and announced his bid as an independent. He has promised to end poverty and guarantee housing.
JILL STEIN
Jill Stein, a physician who ran under the Green Party in 2016, launched her current campaign accusing Democrats of betraying their promises “for working people, youth and the climate again and again – while Republicans don’t even make such promises in the first place.”
Ms. Stein, 73, raised millions of dollars for recounts after Trump’s surprise 2016 victory. Her allegations yielded only one electoral review in Wisconsin, which showed Mr. Trump had won. – Reuters
Jobseekers queue for an interview at a job fair organized by the local government inside a mall in Marikina City, May 1. — PHILIPPINE STAR/MIGUEL DE GUZMAN
By Kyle Aristophere T. Atienza, Reporter
PHILIPPINE President FerdinandR. Marcos, Jr. on Wednesday ordered regional wage boards to review minimum wage rates, as Filipino workers face stagnant salary growth despite rising living costs.
The regional boards should consider economic challenges such as inflation in conducting wage reviews, Mr. Marcos said in a speech during a Labor Day ceremony in Malacañang.
“As president, I call on the Regional Tripartite Wages and Productivity Board to initiate a timely review of the minimum wage rates in their respective regions, with due consideration to the impact of inflation among others, within 60 days prior to the anniversary of their latest wage order,” he said.
Mr. Marcos called on the National Wages and Productivity Commission, which supervises the wage boards, to ensure “a regular and predictable” schedule of wage reviews in order to “reduce uncertainty and enhance fairness for all stakeholders.”
The Philippines adjusts daily minimum wages through its wage boards. The wage board in the National Capital Region (NCR) approved a P40 increase on June 29, 2023, bringing the minimum wage to P610 from P570 for workers in the non-agricultural sector.
However, the slow and meager wage hikes amid rising cost of living have prompted lawmakers to pursue wage hikes through legislation.
Senators have approved a bill on second reading increasing the daily minimum wage in the private sector by P100.
At the House of Representatives, separate bills that seek to increase wages of private sector workers by P150 to P750 have been filed.
Philippine inflation quickened for a second straight month in March — to 3.7% from 3.4% in February — as rice prices continued to surge. In March, inflation-adjusted wages were 16.7%-24.2% or P73.25-P114.20 lower than the current daily minimum wages across the regions in the country.
The Philippine Chamber of Commerce and Industry (PCCI) described Mr. Marcos’ call as “prudent,” saying it was a balanced approach to the demands of the labor sector for a wage increase and proposals in Congress for a legislated wage hike.
“I think it’s a very prudent suggestion to give the tripartite bodies 60 days to discuss this issue,” PCCI Chairman George T. Barcelon said in a phone call.
Employers Confederation of the Philippines President Sergio R. Ortiz-Luis, Jr. said Mr. Marcos’ latest call could mean that current legislated wage hike proposals in Congress do not have his support.
“I think it’s basically driving the message that the ones who should touch the salary should be the wage board,” he said in a phone call.
“It’s an indirect way of saying that the Congress should not meddle,” he said in mixed English and Filipino.
Filomeno S. Sta. Ana III, coordinator at Action for Economic Reforms, said regional wage boards remain the appropriate body to decide on wage hike proposals since they are supposedly “more responsive to local conditions.”
“It moves away from a rigid one size-fits-all approach,” he said in a Facebook Messenger chat.
“In terms of increasing the minimum wage, the yardstick is to ensure that nominal wages keep up with high inflation and that higher worker productivity is rewarded,” Mr. Sta. Ana said.
“As to the tradeoff, whether higher minimum wage triggers worse inflation or unemployment is an empirical question,” he added. “At the same time, there are conditions where such fear or threat of escalating inflation or unemployment does not emerge.”
IBON Foundation said that a P690 across-the-board wage hike is needed to raise the average P440 minimum wage nationwide to the current P1,207 average family living wage nationwide.
“The wage hike is equivalent to 49% of profits across all establishment sizes and would divide profits more or less equally between employers and workers,” IBON Foundation Executive Director Jose Enrique “Sonny” A. Africa said in a Facebook Messenger chat.
“Broken down, the wage hike is equivalent to 54% of profits in micro, 53% in small, and 46% in medium and large firms,” he said.
Raising wages is easiest for medium and large corporations, while the government can help smaller firms with wage subsidies or other support, he noted.
Many small enterprises, especially those under the Barangay Micro Business Enterprises Law, are exempt from any proposed wage increase, Federation of Free Workers President Jose Sonny G. Matula said, as his group backs proposals for a legislated wage hike.
For businesses genuinely unable to meet the new wage standards, provisions under the Wage Rationalization Act allow for exemptions, he added in a Viber message.
Also on Wednesday, Mr. Marcos asked Congress to pass measures that would support his administration’s job creation agenda such as the proposed Enterprise-based Education and Training Program Act, which seeks to rationalize the training programs for middle-level workers, and the Revised Apprenticeship Program Act.
He also mentioned a bill that seeks to further lower the income tax imposed on domestic and foreign firms.
Meanwhile, Mr. Marcos unveiled the master plan for a proposed Workers’ Rehabilitation Center Complex that will be built in Rizal province.
The facility seeks to provide comprehensive management and treatment for injured workers, with a focus on biopsychosocial approach to recovery to enable their reintegration into the workforce.
Electricity prices are expected to rise due to increased demand during the summer months. — PHILIPPINE STAR/RYAN BALDEMOR
THE ENERGY Regulatory Commission (ERC) on Tuesday ordered the suspension of trading in the Wholesale Electricity Spot Market (WESM) during red alerts to prevent a spike in electricity prices.
“Due to the extreme heat, electricity consumption has risen, adding to the price hike. (On Tuesday) the ERC acted to temporarily suspend the operation of the WESM when the system operator or NGCP (National Grid Corp. of the Philippines) declares a red alert,” President Ferdinand R. Marcos, Jr. said in Filipino during a speech at a Labor Day event on Wednesday.
In an order dated April 30, the ERC said WESM trading will be suspended for the Luzon and/or Visayas grid during red alerts based on notices issued by the system operator or NGCP.
WESM is the trading floor for electricity. Under the Republic Act No. 9136 or the Electric Power Industry Reform Act of 2001, the ERC can suspend the operation of the WESM or declare a temporary WESM failure “in cases of national and international security emergencies or natural calamities.”
During the period of market suspension, the ERC said that the administrative price, or the price imposed by the market operator to the trading participants during market suspension or market intervention, will be applied.
If a dispatch interval is subject to both a price mitigation and the administered price, “the lower of the two prices shall apply in the settlement of transactions for such interval,” the ERC said.
“The Commission is working doubly hard to alleviate the impact of El Niño on our power system, and we are finding ways to mitigate the impact of the extremely high demand resulting from the high heat index as these ultimately affect our consumers,” ERC Chairperson and Chief Executive Officer Monalisa C. Dimalanta was quoted as saying in a statement.
The ERC said the average spot prices per day increased by 11% in Luzon and by 53% in the Visayas when alert notices were issued due to the high heat index. These increases would have “a significant impact in the consumers’ electricity bill,” it added.
Based on ERC data as of April 25, Luzon grid has been under red alert for 20 hours and 46 minutes and under yellow alert for 57 hours and 50 minutes. There were no yellow and red alerts in Luzon during the same period last year.
The Visayas grid has been under red alert for 24 hours and 14 minutes, and under yellow alert for 46 hours and 40 minutes. During the same period in 2023, the Visayas grid was only under red alert for three hours and 59 minutes.
“This clearly shows that the alert issuances this 2024 are significantly affecting the condition of the power system attributable to the aforementioned reasons,” the ERC said.
With over 100 cities and municipalities already declared a state of calamity due to the extreme heat conditions nationwide, the ERC said it has determined that such a condition is equal or comparable to a natural calamity.
The WESM trading suspension will be lifted “only if the regional available capacity, less actual regional demand, reaches above zero for 24 consecutive hours.”
“We are also reiterating our call for distribution utilities sourcing from the WESM to be proactive in exploring ways to lessen their exposure,” Ms. Dimalanta said in a statement.
“Impact of high prices can also be alleviated by existing programs, such as the Anti Bill Shock Lending Program of the Land Bank of the Philippines, to at least allow consumers to pay through installment the incremental increases in their electricity bill,” she added.
YELLOW ALERT Meanwhile, the Luzon power grid was placed under yellow alert for the 12th time this month after more than 1,000 megawatts (MW) worth of capacities were unavailable to the grid, the NGCP said.
In a statement on Wednesday, the NGCP said a total of 20 power plants were on forced outage in the Luzon grid resulting in 1,409 MW worth of power supply unavailable to the grid.
Of the 20 power plants, four were offline since last year, three between February and March, and 13 have been on forced outage this month.
The grid operator said a yellow alert will be raised in the Luzon power grid from 8-10 p.m.
Yellow alerts are issued when the supply available to the grid falls below a designated safety threshold. If the supply-demand balance deteriorates further, a red alert is declared.
Luzon’s peak demand hit 12,899 MW while the available capacity is 15,026 MW, data from the NGCP said.
In a statement, the Philippine Energy Efficiency Alliance (PE2) said the Philippines’ must reduce a total of 3,340 MW of the peak demand to manage the power supply deficit.
“PE2 believes that our limited power supply capacities can be optimally planned and dispatched if we try to flatten our steep peak demand curves as an initial step. There is so much talk about beefing up our thinning reserves by accelerating the addition of new power plants, but there are no conscious and concerted efforts toward shaving or shifting peak demand toward off-peak periods,” Alexander D. Ablaza, president of PE2, said in a media release.
The group suggested the management of peak demand before deploying new generating and transmission capacities across the main grids to address the country’s insufficient power supply. — Sheldeen Joy Talavera and Ashley Erika O. Jose
A US dollar note is seen in this June 22, 2017 illustration photo. — REUTERS
By Luisa Maria Jacinta C. Jocson, Reporter
MORE FOREIGN PORTFOLIO investments left the Philippines in March, as investors anticipated a delay in rate cuts by the US Federal Reserve, data from the Bangko Sentral ng Pilipinas (BSP) showed.
Transactions on foreign investments registered with the central bank through authorized agent banks posted a net outflow of $236.02 million in March, significantly higher than the $70.26-million outflows in the same month a year ago.
This was also a reversal of the $689.27-million net inflows recorded in February.
Foreign portfolio investments are called “hot money” because of the ease with which they can enter or leave a jurisdiction, as opposed to foreign direct investments, which are considered less fickle.
Central bank data showed that gross outflows for the month nearly doubled (91.4%) to $1.6 billion from $859.07 million in February.
Year on year, gross outflows jumped by 24% from the $1.3-billion outflows in March 2023.
The US received more than half (53.9%) of total outward remittances, equivalent to $887 million.
Meanwhile, gross inflows declined by 9.1% to $1.4 billion in March from $1.5 billion in the previous month. On the other hand, it rose by 12.1% from $1.25 billion in the year-ago period.
The bulk of investments (56.7%) went to Philippine Stock Exchange-listed securities, mainly banks, holding firms, property, transportation services, and food, beverage and tobacco.
The remaining 43.3% of the inflows went to investments in peso government securities and other instruments.
In March, investments mostly came from the United Kingdom, Singapore, the United States, Switzerland, and Luxembourg, which accounted for 83.6% of the total foreign inflows.
For the first quarter, hot money yielded a net inflow of $377.42 million, a turnaround from the $328.2-million net outflow a year ago.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said more short-term foreign capital exited the country in March as investors had anticipated a delay in rate cuts by the Fed.
Fed policy makers have given more hawkish signals due to sticky US inflation, with rate cut bets being pushed back to as late as September.
“For the coming months, US and local inflation moving closer to central bank targets would lead to possible cut in Fed and local policy rates later in 2024, which would lead to further gains in financial markets and support further improvement in the foreign portfolio investments,” Mr. Ricafort said.
BSP Governor Eli M. Remolona, Jr. earlier said that the central bank may reduce rates by the fourth quarter. However, this could be delayed to the first quarter of 2025 if inflation risks persist.
At its policy meeting last month, the Monetary Board stood pat for a fourth straight meeting, keeping its benchmark rate at a near 17-year high of 6.5%.
From May 2022 to October 2023, the BSP has raised borrowing costs by 450 basis points.
Mr. Ricafort said that a better-than-expected gross domestic product (GDP) growth would also support investments.
Finance Secretary Ralph G. Recto earlier said that growth in the first quarter may range from 5.8-6.3%. The government is targeting 6-7% growth this year.
First-quarter GDP data will be released by the local statistics authority on May 9.
The BSP expects foreign portfolio investments to end the year at a $1.3-billion net inflow.
