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Infrastructure spending may slow as gov’t pursues fiscal consolidation

PHILIPPINE STAR/MICHAEL VARCAS

By Luisa Maria Jacinta C. Jocson, Reporter

THE National Government (NG) may struggle with expediting infrastructure spending as it pursues fiscal consolidation, analysts said.

“The decline in infrastructure (in November) is an indication of the government’s problems with its fiscal consolidation. This means that the government’s policy to reduce fiscal deficit and debt accumulation has not been working as expected,” Ateneo de Manila University economics professor Leonardo A. Lanzona said in an e-mail.

“In the process, funds that should be used for infrastructure are delayed to meet these objectives. As fiscal consolidation remains uncertain, it is unlikely that infrastructure spending will be higher this year,” he added.

Latest data from the Department of Budget and Management (DBM) showed that infrastructure and other capital outlays declined by 29.4% to P56.7 billion in November from P80.2 billion in the same month a year ago.

Month on month, infrastructure spending slumped by 47.2% from P107.3 billion in October.

“This was mainly due to the different timing of big-ticket disbursements in the Department of Public Works and Highways (DPWH), with the ongoing processing of payments for approved billings and disbursement vouchers for civil works, supplies, and equipment, as well as right-of-way claims,” the DBM said.

“Actual payments for these were expected to be taken up in December 2023 following the release of additional cash allocations in the same month,” it added.

Bienvenido S. Oplas, Jr., president of a research consultancy and of the Minimal Government Thinkers think tank, noted that the decline in infrastructure spending in November was due to timing of the release of funds.

“In the third quarter, there was a ramped up funding release for infrastructure (which) normalized or ‘slowed down’ in the fourth quarter. Overall, infrastructure spending is still higher than 2022,” Mr. Oplas said in a Viber message.

In the January-November period, infrastructure spending rose by 18.5% to P1.02 trillion from P861.8 billion in the same period in 2022.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that LGUs with large budget allocations are still “adjusting the learning curve to improve utilization.”

“More funds (were) allocated and devolved from the National Government, especially on the various infrastructure projects,” he said in a Viber message.

Infrastructure disbursements during the 11-month period increased by 11.8% to P1.22 trillion. These include estimated NG infrastructure disbursements and infrastructure components of subsidy and equity to government-owned and -controlled corporations (GOCCs) and transfers to local government units (LGUs).

The DBM earlier said faster implementation of projects, especially infrastructure, was likely in December 2023.

“Although the actual full-year 2023 fiscal performance data will still be released between February and March 2024, the recovery of spending performance during the second half of 2023 is notable, particularly the acceleration of infrastructure expenditures,” it added.

Based on its Medium-Term Fiscal Framework, the government’s infrastructure program is set at P1.29 trillion for 2023, equivalent to 5.3% of gross domestic product (GDP).

Broken down, this comprises NG infrastructure (P989.9 billion), infrastructure subsidy (P101.9 billion) and infrastructure transfers to LGUs (P199 billion).

This year, the program is set at P1.4 trillion or 5.2% of GDP, based on the latest Development Budget Coordination Committee data.

The government is hoping to sustain infrastructure spending of up to 5-6% of GDP annually.

In 2022, infrastructure spending jumped to P1.02 trillion from P895.1 billion in 2021.

“It’s a welcome development that year-to-date numbers show infrastructure spending to be rising. However… it may not be rising fast enough to the target level,” Union Bank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said in a Viber message.

Mr. Asuncion said that infrastructure spending may have been impacted by the challenges faced by government expenditures.

Latest data from the local statistics authority showed that government spending contracted by 1.8% in the fourth quarter, bringing full-year spending to a flat growth of 0.4%.

The economy grew by 5.6% in 2023, falling short of the full-year 6-7% target and much slower than the 7.6% expansion logged in 2022.

“Although it is respectable headline growth, we may see slower pace of spending (in general) because of the National Government’s focus or priority of debt and deficit management that may bode well in the longer term,” Mr. Asuncion said.

The government is targeting to reduce its debt-to-GDP ratio to below 60% by 2025 and deficit-to-GDP ratio to 3% by 2028.

National Economic and Development Authority Secretary Arsenio M. Balisacan earlier said that slower government spending was “intentional” as part of the NG’s fiscal consolidation plan.

Government agencies were initially ordered to craft catch-up plans for spending for the second semester after government spending fell sharply by 7.1% in the second quarter.

Mr. Asuncion said it may be difficult to meet infrastructure spending targets this year due to the agencies and LGUs’ “perennial problem of absorptive capacity and the capability to spend the budget.”

“Moreover, the elevated interest rates are an added layer of difficulty for infrastructure spending because of the need for the government to deal with interest payments over using more of the limited budget to spend on more productive expenditures like infrastructure development that has multiplier effects on the economy,” he added.

From May 2022 to October 2023, the Bangko Sentral ng Pilipinas (BSP) hiked borrowing costs by 450 basis points. This brought the key interest rate to 6.5%, the highest in 16 years.

The Marcos administration has approved 198 infrastructure flagship projects with an indicative total project cost of P8.78 trillion.

Philippine short selling in short demand 3 months after its launch

The Philippines embraced short selling, which is limited to brokers and their clients, when its peers like China and South Korea are tightening control over it. -- BW FILE PHOTO

By Revin Mikhael D. Ochave, Reporter

JOHN RUSSELL DC. MANARANG, 22, is excited about finally being able to short sell on the Philippine Stock Exchange (PSE), thinking this would let him take a profit when the market is down.

“I am considering short selling because I don’t like buying long,” Mr. Manarang, who runs a food cart business, said in a Facebook Messenger chat. “Even when you short sell, you could still be a profitable trader.”

After a nearly three-decade wait, traders have been allowed since November to short sell stocks in the Philippines after regulators approved a proposal first made by the Philippine Stock Exchange, Inc. in 1996 — five years before Mr. Manarang was born.

A total of 52 stocks including all shares on the Philippine Stock Exchange index (PSEi), and one exchange-traded fund, may be sold short, meaning investors can borrow a security, sell it on the open market and expect to buy it back later at a lower price.

The Philippines embraced short selling, which is limited to brokers and their clients, when its peers like China and South Korea are tightening control over it amid higher US interest rates. Aside from the Philippines, short selling is being done in Singapore, Hong Kong, Malaysia, Thailand and Indonesia.

The PSE is seeking to revive interest in a market where average daily stock transactions have slumped by about 40% in the past decade, and foreign equity investments have sunk for the past six years, according to Bloomberg data.

But not so many traders share Mr. Manarang’s excitement, based on the slow adoption of the trading strategy in the country, Juan Paolo E. Colet, managing director at China Bank Capital Corp., is not surprised.

“First, the backend and client systems and processes of local brokers are configured for a long-only market, so it takes time to adopt the necessary changes,” he said in a Viber message. “Second, many investors are still not knowledgeable on how short selling works and even some seasoned market participants find the setup quite complex.”

Short selling is also being introduced when there is more upside rather than downside risks in the Philippine stock market, “so that premise makes short selling a challenging trading strategy to deploy,” Mr. Colet said.

Still, local brokerages are planning to introduce short selling to their clients by June, he said.

Alfred Benjamin R. Garcia, senior research analyst at AP Securities, Inc., said short selling could increase market liquidity.

“Think of it as a one-way street that suddenly became two-way,” he said in a Viber message. “It will also help price discovery.”

“Currently, the prevailing strategy is you find an undervalued stock, buy it and hold until it reaches fair value, or close to it,” Mr. Garcia said.

“But stocks that are overvalued remain overvalued because there is no financial incentive for the market to bring it down to its fair value. With short selling, ideally, the market will be incentivized to seek out overvalued stocks and correct this overvaluation,” he added.

 

‘RISKIER’
Short selling would let investors trade and make money in either bullish or bearish market conditions, said Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp. “The penultimate objective is to create a healthy balance in the market for both long and short trade positions to co-exist in the local stock market,” he said in a Viber message.

“Local adoption should be based on established global best practices, especially for risk management for our local stock market,” he added.

Mr. Colet said short selling could become “very risky” for retail investors. “If they are not careful, they can lose more money compared with a long-only investment in stocks.”

“On that note, it is important for the PSE and brokerages to properly educate investors about the uses, risks and requirements of shorting,” he added.

Mr. Garcia said short selling could be riskier than buying stocks.

“We need more market education campaigns,” he said. “It’s significantly riskier than buying because when you buy, hypothetically your investment will never reach zero unless the stock delists, and you weren’t able to tender.”

“But when you short sell, you can potentially zero out your investment if the stock keeps going up. But there are safeguards in place for that,” he added.

PSE President and Chief Executive Officer Ramon S. Monzon earlier said the bourse does not expect any spikes in liquidity in the short term following the November short-selling launch.

“We are not expecting any spike in liquidity in the short term since market participants, including brokers and investors, will need time to understand the requirements and risks of securities borrowing and lending and short selling,” he said.

“This is typical in any market introducing a new product or service, most especially in more complex ones like shorting. Short selling is also not a cure-all for market liquidity but a necessary step and building block towards developing other products such as derivatives,” he added.

Over time, the PSE expects more shares to become available for short selling.

Mr. Manarang, mentioned at the outset, said he’s aware of the risks of short selling. “I’m willing to face the risks, even if I don’t fully know where the prices will go.”

Philippines among top 3 favorable markets for established brands

Filipino shoppers prefer established consumer brands, according to a report by a consultancy firm. -- PHILIPPINE STAR/MIGUEL DE GUZMAN

THE Philippines is among the top three most favorable markets for established consumer brands as traditional trade dominates the retail space, according to a report by Bain & Co.

In a report, the consultancy firm said Malaysia, India, and the Philippines were the top three most favorable markets for incumbent consumer product brands. Meanwhile, South Korea, Singapore, and China were most favorable for rising consumer brands.

“The trend could be linked to the channel dynamics across markets. For example, the thriving e-commerce sector and well-established networks of third-party suppliers are making countries like South Korea particularly conducive for emerging consumer brands’ growth,” said Jichul Kang, head of Bain’s consumer products practice in South Korea, in a statement.

“On the other hand, the dominance of traditional trade and relatively low penetration of e-commerce make countries like the Philippines more favorable markets for established brands,” Mr. Kang added.

In the Philippines, incumbent brands got a bigger market share in eight out of 23 consumer product goods (CPG) categories which are spirits, wine, bath and shower, oral care, confectionery, edible oils, laundry care, and bottled water.

Meanwhile, incumbent brands in the Philippines only lost in seven categories which are color cosmetics, fragrances, hair care, skincare, pet food, sweet biscuits, and drinking milk products, which Bain said still indicates incumbent brands’ dominance.

Market share of the remaining eight categories studied by Bain was stable or had little to no change as “the complex channel dynamics” in the Philippine market makes it challenging for new entrants to come in.

The report studied incumbent brands’ market share in 23 CPG categories from 2018 to 2022.

Traditional trade still dominates the retail market in the Philippines. Bain said traditional trade accounted for around 53% of the retail value across the 23 categories it studied in the Philippines, while retail e-commerce sales penetration is seen at 2%.

“This significant share underscores the importance of robust route-to-market capability for brands aiming to succeed in the market. Such a landscape presents a formidable barrier to entry for new competitors,” Bain said.

Category wise, the beauty and personal care sector was where insurgent brands performed better, as new entrants beat incumbents in four out of six categories in the Philippines.

In contrast, established brands continued to have a bigger share in the alcoholic and non-alcoholic beverage, food, and home care sectors.

Meanwhile, Bain said that local incumbent brands in the Philippines showed stronger ability to gain share in winning categories despite foreign incumbents leading in market share across most categories.

“The success of these local brands can be attributed to their extensive distribution networks in rural areas and lower-tier cities, where they effectively leverage traditional trade channels,” Bain said.

To gain even better footing in the market, Bain said that incumbent companies must look for more effective strategies in managing their brands.

“While market, category characteristics, and macro situations contribute to incumbents’ success to some extent, what matters most is how they manage their categories and brands,” it said.

“Successful incumbent companies are adept at incorporating the most effective strategies from insurgent competitors while leveraging their inherent strengths,” it added.

Bain noted incumbent companies should innovate by looking at emerging trends.

“Our study challenges the notion that insurgent brands universally disrupt incumbents. Many incumbents have successfully maintained or grown their market share amid tight competition,” said David Zehner, head of Bain’s Asia-Pacific consumer products practice.

“The successful incumbents thrived by blending their incumbent strengths and insurgent tactics, allowing them to counter threats and strengthen their market position effectively,” Mr. Zehner added. — Justine Irish D. Tabile

BoC @ 122: Paving a shared path to prosperity

Finance Secretary Ralph G. Recto's visit in BoC on Jan. 24 — Photo from facebook.com/BureauOfCustomsPH

One of the earliest recordings of Philippine history contain examples of how the datus and rajahs of old bartered with traders from distant lands. This practice led to the relative wealth and prosperity of the country at the time, created long-lasting connections with the country’s neighbors, and laid the foundation for what would become the customs system.

Today, centuries later, the Bureau of Customs (BoC) continues in this tradition, cultivating new alliances and paving a path towards shared prosperity by upholding a responsive, adaptive, and resilient customs administration that collaborates and engages with all of its stakeholders.

All ten Customs Administrations of ASEAN Member States, including the Philippines, signed the Mutual Recognition Arrangement for their Authorized Economic Operator (AEO) Programs to establish a transparent trading environment last year.

Meanwhile, the BoC also collaborated with the United States Agency for International Development’s ASEAN Policy Implementation (API) to enhance customs practices and develop synergies with other ASEAN member countries.

This is not to mention the numerous events, discussions and assemblies that the organization participated in and hosted last year, which include: the 34th Meeting of the ASEAN Customs Procedures and Trade Facilitation Working Group, the Brunei Darussalam-Indonesia-Malaysia-Philippines East ASEAN Growth Area Trade Facilitation Cluster, the 31st Meeting of the ASEAN Single Window Steering Committee, to further boost international relations, broaden networks, and enhance customs management through knowledge and best practice sharing.

Commissioner Bienvenido Y. Rubio delivered a congratulatory message to 113 loyalty awardees and 58 customs officers who completed their post-graduate degrees in 2023 during the fourth flag-raising ceremony of the BoC this year. — Photo from facebook.com/BureauOfCustomsPH

“The BoC stands at the forefront of championing economic growth and securing the sustainability of the supply chain. With this, we recognize our immense responsibility to consistently develop and formulate new means in which we can build stronger alliances for a more progressive customs management,” Commissioner Bienvenido Y. Rubio said.

It stands to reason that such efforts will lead to better trade and commerce between ASEAN member states. Last year, the bureau had collected P883.624 billion, surpassing its P874.16 billion target by 1.08%, according to the Department of Finance.

“I commend the BoC for its outstanding performance in 2023. In 2024, expect the bureau to continue modernizing its customs administration and processes to effectively curb illicit trade, generate more revenues to fund the government’s priority development projects, ensure the protection of our consumers, and enhance the country’s ease of doing business,” Former Finance Secretary Benjamin E. Diokno said.

Moving forward, Mr. Rubio raised their goal to P959 billion for 2024, focusing on increasing collections by continuing its fight against smuggling and the continuous improvement of modernization projects.

Photo from facebook.com/BureauOfCustomsPH

Key among these initiatives is the Enhanced Value Reference Information System (e-VRIS), which is a critical risk assessment tool for safeguarding government revenues and facilitating trade. The BoC is also actively working on implementing an ICT-enabled clearance system for express shipments and in the process of drafting Customs Administrative Orders (CAO) and Customs Memorandum Orders (CMO) for e-Commerce to prevent revenue leakages.

A long, storied history

The Philippine customs system during the Spanish rule underwent many significant changes that led to its current evolution. When the Spanish Customs Law of 1582 was introduced, it marked the beginning of a more formalized customs process in the country. This period also saw the establishment of a Tariff Board, which standardized duties on imports, a practice that continued until the end of Spanish rule.

The American colonial period brought further transformations. The Americans initially enforced the Spanish Tariff Code of 1891 but soon enacted the Tariff Revision Law of 1901 to align the customs services with American practices. This era witnessed the restructuring of customs positions and the creation of the Bureau of Customs and Immigration under the Department of Finance and Justice — a significant step in the evolution of the customs service in the Philippines.

Post-World War II and the establishment of the Commonwealth Government saw the Bureau of Immigration separated from Customs; and, in 1957, the Tariff and Customs Code of the Philippines (Republic Act No. 1937) was enacted. This act was a landmark in the history of the bureau, as it represented the first autonomous Philippine Tariff Policy.

Photo from facebook.com/BureauOfCustomsPH

The bureau underwent a major reorganization in 1965, which streamlined its operations and elevated several offices to departmental levels. The period of Martial Law in the country saw further amendments to the customs code, with significant changes being introduced by Presidential Decree No. 34 in 1972.

The bureau saw another pivotal moment in 1986 in the form of Executive Order No. 127, which further led to a comprehensive reorganization down the line, expanding the bureau’s structure and introducing technological advancements, including the establishment of the Management Information System and Technology Group (MISTG) in 1998.

A key component of the bureau’s evolution has been the Enforcement and Security Service (ESS), established to combat smuggling and enforce customs laws. From its early days as the Harbor Police in 1902 to its current form, the ESS has been instrumental in securing the nation’s borders and safeguarding revenue.

Since then, a key focus for the bureau has been combating corruption and smuggling, perennial challenges in customs administration. Various measures, including stricter enforcement of laws, enhanced port surveillance, and internal reforms, have been implemented to address these issues. Legislative reforms and policy changes have also been a constant feature, aligning the bureau’s operations with the broader economic policies of the Philippine government and global trade practices.

The bureau’s efforts to align with international customs standards have involved collaboration with international agencies and adherence to global regulations, facilitating smoother international trade. Capacity building and training of personnel, meanwhile, have been crucial in keeping up with the demands of modern customs administration, encompassing new technologies, international practices, and ethical standards.

Public engagement and transparency have become increasingly important, reflecting broader governance reforms in the Philippines. Reflecting this, the bureau’s operations have become more transparent and accessible, aiming to foster public trust and accountability. Additionally, the bureau has had to navigate various global and regional changes, including shifts in trade patterns and economic crises, adapting its strategies and operations accordingly.

The COVID-19 pandemic presented unique challenges, with the bureau playing a pivotal role in managing the flow of essential goods under new health and safety protocols. This period underscored the bureau’s agility and responsiveness to unprecedented global events.

Ongoing modernization efforts continue to shape the bureau, with a focus on improving efficiency, reducing bureaucracy, and enhancing the effectiveness of customs processes. These efforts reflect the bureau’s commitment to adapting to changing times while maintaining its core functions in customs administration.

Photo from facebook.com/BureauOfCustomsPH

Perhaps one of the most significant is how it attempted to modernize border security and streamlining operational processes through the National Customs Intelligence System (NCIS) that launched in December last year.

The NCIS, developed by BoC’s Management Information Systems and Technology Group (MISTG) upon the initiative of the Intelligence Group, will serve as a secured data warehouse for intelligence information from various units of the agency. It provides a database to generate actionable intelligence information, and support case build-up, risk profiling, and analysis.

The system’s capabilities extend to equipping authorized officials with data-driven insights, thereby enhancing the bureau’s operational efficiency and effectiveness and reinforcing its ability to better safeguard national borders and facilitate international trade.

Photo from facebook.com/BureauOfCustomsPH

With the launch of the NCIS, the bureau has taken a giant leap forward in its intelligence capabilities, ushering in a new age of effective and efficient management of intelligence activities. With the system up and running, BoC can face the future with more intelligence, more resilience, and unwavering commitment to paving the nation’s path to progress. — Bjorn Biel M. Beltran

Vacancy rates seen to rise for Metro Manila’s prime offices

CHRIS ANDERSON-UNSPLASH

VACANCY RATES for prime offices in Metro Manila are projected to rise this year due to the potential increase in flexible work arrangements in the information technology and business process management (IT-BPM) sector, according to global real estate services firm Cushman & Wakefield.

“With the large volume of office space expected to be completed in the first half of 2024, as well as the proposed amendments to legislation that will allow for the IT-BPM sector to operate on a more flexible work-arrangement, vacancies are projected to increase,” Cushman & Wakefield Director and Head of Tenant Advisory Group Tetet Castro said in a statement on Monday.

The rules on remote work schemes should be clarified, or there is a risk of affecting office space absorption, said Claro G. Cordero, Jr., Cushman & Wakefield director and head of research.

“The current confusion… will further stall expansion decisions of IT-BPM companies. These future growth plans will stimulate office space absorption in the local market,” he said.

Under the CREATE to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) bill, the IT-BPM sector will be allowed to “conduct business under alternative work arrangements.”

The Justice department issued a legal opinion on Jan. 3 regarding the applicability of tax incentives for registered business enterprises on remote work, saying that IT-BPM companies within economic zones should work onsite to retain their tax perks.

Justice Secretary Jesus Crispin C. Remulla said that Section 309 of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law “requires registered projects under an investment promotion agency (IPA) administering an ecozone or freeport to be exclusively conducted or operated within the geographical boundaries of the zone or freeport.”

Meanwhile, Cushman & Wakefield reported that the vacancy of prime and Grade A office spaces in Metro Manila dipped slightly to 16.3% in the fourth quarter of 2023 from 16.8% in the previous quarter.

It added that the average asking rent declined in the last quarter, with the average asking rent down by 1.8% to P1,023 per square meter (sq.m.) per month, down by 1.5% from the P1,038 per sq.m. in the same period in 2022.

“By end-Q4 2023, over 93,000 sq.m. of office space has been added to the supply bringing the overall stock of Prime and Grade ‘A’ office space in Metro Manila to roughly 9.5 million sq.m.,” the company said.

According to Mr. Cordero, the return of global office space demand to 2019 levels is still far from fruition due to higher inflation rates.

“Despite inflation rates cooling down, global interest rates will remain elevated. As a result, the return to pre-pandemic global demand for office spaces from traditional sources remains distant,” he said.

Cushman & Wakefield said that retail space demand could improve amid rising activity levels and investments from international retailers. However, the demand could be hampered by high prices and interest rates.

“The near-term outlook of the other key drivers of industrial segment, particularly the manufacturing and trade industries, remain challenged amidst unfavorable global business climate whilst overall prospect for growth remains solid to cater to e-commerce supply chain requirements,” Mr. Cordero said.

The real estate services firm also mentioned that demand and capital values in the residential market could improve due to anticipated rate cuts, resilient job market, and strong overseas Filipino remittances. — Revin Mikhael D. Ochave

Meralco says power bidding aimed at lowest-cost supply

PHILIPPINE STAR/ MICHAEL VARCAS

MANILA ELECTRIC Co. (Meralco) on Monday denied claims of anticipated power rate increases resulting from closed bidding with generation companies that supply through gas-fired plants using imported liquefied natural gas (LNG).

In a statement, the power distributor said the conducted bidding aimed to secure enough power at the lowest cost.

Meralco closed the bidding for its 1,800-megawatt (MW) and 1,200-MW capacities for its baseload requirements last month.

“This is to minimize, if not avoid, dependence on the Wholesale Electricity Spot Market, where prices are known to be highly volatile especially during the dry season given the higher demand and the historically tight supply,” Meralco said.

The power distributor responded to claims by the consumer group People for Power Coalition (P4P), which warned of additional power rate increases if Meralco’s new contracts with generation companies using fossil fuels are approved.

“Meralco has already gone two for two with its worsening power prices. It seems to be hell-bent on making 2024 a year of expensive electricity for consumers,” P4P Convenor Gerry C. Arances said in a statement.

P4P cited the rate indication set by Meralco, which has projected an increase in February power rates, attributing the pressure on the generation charge to higher fuel prices, particularly on imported LNG used by gas-fired power plants.

“Meralco is set to begin its new contracts just as the country enters the summer, considered as the power industry’s peak season. Previous years saw the surge of power prices and widespread outages of fossil fuel plants during that period,” P4P said.

Meralco said that the conduct of competitive selection processes (CSPs) aimed “to benefit the public by ensuring sufficient and reliable energy at the most competitive cost” in accordance with the policies set by the Energy Regulatory Commission (ERC).

For the 1,800 MW baseload requirement, GNPower Dinginin Ltd. Co., Mariveles Power Generation Corp., and Excellent Energy Resources, Inc. (EERI) submitted the lowest bids.

GNPower, a partnership among Aboitiz Power Corp. through unit Therma Power, Inc., AC Energy and Infrastructure Corp., and Power Partners Ltd. Co., owns a 1,336-MW coal-fired power plant in Mariveles, Bataan.

Mariveles Power has a coal-fired power project in Bataan while EERI is constructing an LNG combined cycle plant in Batangas. Both companies are subsidiaries of San Miguel Global Power Holdings (SMGPH), the energy arm of San Miguel Corp.

Meanwhile, South Premiere Power Corp. (SPPC), another subsidiary of SMGPH, is advancing to the post-qualification stage after its bid has been declared as the most favorable for the 1,200-MW bid.

SPPC is the administrator of the natural gas-fired power plant in Ilijan, Batangas.

All contracts resulting from the CSPs will be subject to the regulatory proceedings of the ERC.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera

Taylor Swift caps dominant year with record-breaking Grammy win

WINNERS ALL: (L-R) Phoebe Bridgers, Lucy Dacus, and Julien Baker of boygenius, pose with their trophies for Best Alternative Music Album, the Best Rock Song, and Best Rock Performance, along with Taylor Swift who won Album of the Year and Best Pop Vocal Album, and Ms. Swift’s long-time collaborator Jack Antonoff, who won for Producer of the Year, Non-Classical, backstage during the 66th Annual Grammy Awards in Los Angeles on Feb. 4. —REUTERS/DAVID SWANSON

TAYLOR SWIFT captured the Grammy Award for album of the year on Sunday, capping off one of the most successful years in pop culture history by becoming the first singer to win the music industry’s top prize four times. Ms. Swift’s album Midnights took home the honor, adding to her previous wins for Fearless, 1989, and Folklore.

Ms. Swift had previously been tied with Frank Sinatra, Paul Simon, and Stevie Wonder for the most wins in the category. Album of the year was one of two prizes for Ms. Swift on the night, who used her acceptance speech for best pop vocal album to announce a new album due out in April. Titled The Tortured Poets Department, she finished the album while also mounting the best-selling tour in music history.

“I would love to tell you this is the best moment of my life, but I feel this joy when I finish a song,” Ms. Swift said after winning the prize. “For me, the award is the work.” Jack Antonoff, Ms. Swift’s long-time collaborator, won for producer of the year, non-classical and credited Ms. Swift for much of his success.

Ms. Swift set the record during a big night for women at the Grammys. Female acts swept all four of the top prizes and accounted for seven of the eight nominees for album of the year. Billie Eilish claimed song of the year for “What Was I Made For?,” her track from the soundtrack of the movie Barbie and Miley Cyrus won record of the year for her song “Flowers.” (Song of the year awards songwriters while record of the year goes to producers and performers.)

Women also won categories typically dominated by men. The rock trio Boygenius won three awards while Karol G, a rising star from Medellín, Colombia, became the first woman to win best música urbana album.

The Recording Academy has been criticized in the past for its failure to recognize female artists. In 2018, only one woman won a solo award, and, when asked about the lack of diversity, the Recording Academy’s president at the time, Neil Portnow, put the onus on women rather than institutional and societal bias.

He told reporters “women who have the creativity in their hearts and souls, who want to be musicians, who want to be engineers, producers, and want to be part of the industry on the executive level” need to “step up.”

The comment sparked outrage and prompted the hashtag #GrammysSoMale to trend. Artists, including P!nk and Katy Perry spoke out, and, a year later, Mr. Portnow stepped down. The Recording Academy has added many new members in response to criticism about not rewarding women or people of color.

“We want y’all to get it right,” Jay-Z said while accepting the inaugural Dr. Dre global impact award. The rapper and mogul pointed out that his wife Beyoncé has won the most Grammys of any artist, yet has never won album of the year.

While women swept the top four awards, only one of them was a woman of color. Victoria Monét, who has written songs for Ariana Grande and Chris Brown, claimed the prize for best new artist about 15 years after she started her career. SZA, an R&B singer who earned the most nominations of any artist with nine, won two prizes.

Comedian Trevor Noah hosted the show, which aired live on the CBS broadcast network. The Grammys’ viewership has slipped in recent years, but it still commands one of the largest audiences of any awards show on TV in the US.

Mr. Noah wasted little time dipping into the week’s biggest controversy, an ongoing dispute between ByteDance Ltd. and Universal Music Group, the world’s biggest record label, which pulled its artists’ songs from TikTok this week after licensing negotiations between the two entities fell apart.

“Shame on you for ripping off all of these artists,” Mr. Noah said to applause and surrounded by some of the industry’s biggest names, many of whom had their music taken down. Artists have been split on the issue. Mr. Antonoff said artists “can’t get used to getting paid less” but also should have known about UMG’s plans.

While Ms. Swift was the star of the show, the Grammys also offered a stage to big stars of the previous century. Tracy Chapman, whose song Fast Car climbed the charts thanks to a cover by Luke Combs, performed alongside the country star. Joni Mitchell performed and also won for an album recorded live nearly two years ago at Newport Folk Festival. That was her first full-length concert since 2000, and occurred after an aneurysm in 2015 that required her to re-learn how to play the guitar. — Bloomberg

Grammys 2024: Winners at televised ceremony

LOS ANGELES — The Grammy Awards, the highest honors in the music industry, were handed out at a ceremony on Sunday (Monday in Manila), broadcast on CBS and hosted by Trevor Noah.

Following is a list of the winners in the categories at the televised ceremony:

Album Of The Year: Midnights, Taylor Swift

Record Of The Year: “Flowers,” Miley Cyrus

Song Of The Year: “What Was I Made For?,” Billie Eilish (from the motion picture Barbie); Billie Eilish O’Connell & Finneas O’Connell, songwriters

Best New Artist: Victoria Monet

Best Pop Vocal Album: Midnights, Taylor Swift

Best Pop Solo Performance: “Flowers,” Miley Cyrus

Best Musica Urbana Album: Manana Sera Bonito, Karol G

Best Country Album: Bell Bottom Country, Lainey Wilson

Best R&B Song: “Snooze,” by SZA; Kenny B. Edmonds, Blair Ferguson, Khris Riddick-Tynes, Solana Rowe & Leon Thomas, songwriters

The Dr. Dre Global Impact Award: Jay-Z — Reuters

Megaworld targets to open 31-storey Pasig hotel by 2029

ONE PASEO is the first office development within the 12.3-hectare Arcovia City in Pasig City. — COMPANY HANDOUT

TAN-led Megaworld Corp. announced on Monday that it is now building the 31-storey ArcoVia Hotel in Pasig City, scheduled for opening by 2029.

In a regulatory filing, the listed property developer said that ArcoVia Hotel, located in the ArcoVia City township along C5-Road, will have 339 hotel suites.

The hotel’s room types and sizes will range from twin suites (up to 29 square meters [sq.m.]), queen suites (up to 27.5 sq.m.), junior suites (34 sq.m.), executive suites (up to 54 sq.m.), and presidential suites (108 sq.m.), the company said.

Megaworld Hotels & Resorts Managing Director Cleofe C. Albiso said that the ArcoVia Hotel will be the 21st property in its portfolio and the company’s tallest hotel development to date.

“This hotel really suits the world-class vibe of ArcoVia City, and will even delight future guests with an unimpeded view of the iconic Arco de Emperador,” she said.

ArcoVia Hotel will be situated across the Acro de Emperador and in front of the two-tower ArcoVia Palazzo and the 45-storey 18 Avenue de Triomphe condominium developments.

The hotel will feature a swimming pool, kiddie pool, pool deck with lounge and seating areas, outdoor lounge and landscaped areas, kids club, wellness spa, wet and dry sauna, fitness center, and executive lounge, the company said.

It will also feature a business center with workstations, a ballroom, two function rooms, a meeting room, and an outdoor events area.

ArcoVia Hotel will also have four food and beverage outlets, gift shop, several retail establishments, bike racks, and electric vehicle charging stations.

According to Megaworld, ArcoVia City is a 12.3-hectare township that features residential condominiums, retail hub, office towers, and a lush landscape.

Out of the 20 hotel properties launched by Megaworld, 12 are operational with around 5,000 hotel room keys. These include Richmonde Hotel Ortigas, Eastwood Richmonde Hotel, Richmonde Hotel Iloilo, Savoy Hotel Newport, Savoy Hotel Boracay, Savoy Hotel Mactan Newtown, and Belmont Hotel Manila.

Also included are Belmont Hotel Boracay, Belmont Hotel Mactan, Kingsford Hotel Manila, Twin Lakes Hotel in Laurel, Batangas near Tagaytay, and Hotel Lucky Chinatown in Binondo, Manila.

Shares of Megaworld rose by three centavos or 1.52% to P2 apiece on Monday. — Revin Mikhael D. Ochave

T-bills fetch mostly higher rates on fading hopes of early Fed cut

BW FILE PHOTO

THE GOVERNMENT made a full award of the Treasury bills (T-bills) it offered on Monday at mostly higher yields amid expectations of a delayed rate cut from the US Federal Reserve.

The Bureau of the Treasury (BTr) raised P15 billion as planned via its offering of T-bills on Monday as total bids reached P47.415 billion, or more than thrice the amount on the auction block.

Broken down, the Treasury made a full P5-billion award of the 91-day T-bills as tenders for the tenor reached P12.985 billion. The three-month paper was quoted at an average rate of 5.461%, 6.3 basis points (bps) higher than the 5.398% seen last week. Accepted rates ranged from 5.425% to 5.495%.

The government also raised P5 billion as planned from the 182-day securities as bids stood at P13.94 billion. The average rate for the six-month T-bill stood at 5.861%, up by 5.1 bps from the 5.766% fetched last week, with accepted rates at 5.84% to 5.873%.

Lastly, the BTr borrowed the programmed P5 billion via the 364-day debt papers as demand for the tenor totaled P20.58 billion. The average rate of the one-year T-bill inched down by 0.1 bp to 6.075% from the 6.076% quoted last week. Accepted yields were from 6.05% to 6.098%.

At the secondary market on Monday before the auction, the 91-, 182-, and 364-day T-bills were quoted at 5.4422%, 5.8126%, and 6.044%, respectively, based on PHP Bloomberg Valuation Service Reference Rates data provided by the BTr.

“The awarded rates reflected the stronger-than-expected US employment reports for January, which bolstered views of further delay in Federal Reserve policy rate cuts,” a trader said in an e-mail.

Signals from Fed Chair Jerome H. Powell that a rate cut in March is unlikely also caused T-bill rates to go up, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

The US Federal Reserve can be “prudent” in deciding when to cut its benchmark interest rate, with a strong economy allowing central bankers time to build confidence inflation will continue falling, Fed Chair Jerome H. Powell told the CBS news show 60 Minutes in an interview that aired Sunday night, Reuters reported.

“The prudent thing to do is… to just give it some time and see that the data confirm that inflation is moving down to 2% in a sustainable way,” Mr. Powell said. “We want to approach that question carefully,” with the economy’s current strength keeping the risk of recession reduced as policy makers wait for the final bits of data that will convince them to proceed with rate cuts.

The interview took place on Thursday, before a blowout January jobs report on Friday showed firms added 353,000 new positions, with continued strong wage growth and 3.7% unemployment that has barely budged in two years.

Traders are pricing in less than a 20% chance that the Fed could begin easing rates in March, as compared to a nearly 50% chance a week ago, according to the CME FedWatch tool. The odds for a cut in May have also lengthened.

Fed funds futures now show roughly 120 bps worth of easing priced in for the Fed this year, down from about 150 bps at the end of last year.

The Fed left interest rates unchanged last week, but Mr. Powell told reporters that rates had peaked. Since March 2022, the central bank has raised its policy rate by 525 basis points to the current 5.25% to 5.5% range.

On Tuesday, the BTr will offer P30 billion in reissued five-year Treasury bonds (T-bonds) with a remaining life of four years and 11 months.

The Treasury plans to raise P210 billion from the domestic market this month, or P60 billion via T-bills and P150 billion through T-bonds.

The government borrows from local and foreign sources to help fund its budget deficit, which is capped at 5.1% of gross domestic product this year or P1.39 trillion. — A.M.C. Sy with Reuters

Firefly, GomBurZa are the big winners at 2024 MIFF awards

MIFF SPOKESPERSON NOEL FERRER

THE 1st MANILA International Film Festival (MIFF) in Los Angeles, California, which aimed to promote Filipino films made in the Philippines on the US and international film stage, saw Zig Dulay’s fantasy film Firefly emerge as the night’s big winner.

The MIFF showed the same line-up of films as the 2023 Metro Manila Film Festival (MMFF) did last December.

Having been named Best Picture during the MMFF, Firefly again bagged the Best Picture award at the MIFF.

Meanwhile, Pepe Diokno’s historical drama GomBurZa was named Second Best Picture.

The awarding ceremony was held at the TCL Chinese Theatre in Los Angeles, California on Feb. 3.

Firefly’s other three awards that night were Best Screenplay for Angeli Atienza, Best Supporting Actress for Alessandra de Rossi, and Best Director for Zig Dulay.

The film follows Tonton (played by Euwenn Mikaell), who searches for the mythical island of fireflies that his mother Elay (played by Ms. De Rossi) told him about in her bedtime stories.

GomBurZa’s two other awards were Best Cinematography for Carlo Mendoza and the Audience Choice award. The film garnered acclaim for telling the tale of martyred Filipino Catholic priests Mariano Gomez, José Burgos, and Jacinto Zamora.

Coming home with two awards is family drama Rewind — which is also the first Filipino film to have earned over P900 million at the box office. Its actors, Dingdong Dantes and Pepe Herrera, won Best Actor and Best Supporting Actor, respectively, at the MIFF.

Tied with Mr. Dantes as Best Actor was Piolo Pascual, who played three different lead characters in the horror film Mallari, while Vilma Santos bagged the Best Actress award for her role in the romance When I Met You in Tokyo.

The 2024 MIFF jury included director Marie Jamora; Birns & Sawyer chief executive officer Mari Acevedo; director of photography Leah Anova; TV, film, and Broadway actor Reggie Lee; arts school director David Maquiling; and television and film actress Sumalee Montano — Brontë H. Lacsamana

And the winner is…

HERE is the full list of winners at the 2024 Manila International Film Festival awards night which was held on Feb. 3.

Best Picture: Firefly

2nd Best Picture: GomBurZa

Special Jury Prize: Becky and Badette

Audience Choice Award: GomBurZa

Best Director: Zig Dulay, Firefly

Best Actor: Dingdong Dantes, Rewind; Piolo Pascual, Mallari

Best Actress: Vilma Santos, When I Met You In Tokyo

Best Supporting Actress: Alessandra de Rossi, Firefly

Best Supporting Actor: Pepe Herrera, Rewind

Best Cinematographer: Carlo Mendoza, GomBurZa

Best Screenplay: Angeli Atienza, Firefly

Trailblazer Awards: Mark Dacascos, Romando Artes, and Rochelle Ona

Lifetime Achievement Award: Ms. Hilda Koronel

Celebrating the vital role of customs in global trade

Photo from www.wcoomd.org

Exactly 14 days before they celebrate their anniversary on Feb. 6 every year, the Bureau of Customs (BoC), along with other customs agencies communities around the world, come together and celebrate the first council session of the organization that unites them all.

In 1948, 17 European countries set up a Customs Union Study Group to examine the possibility of creating a customs union in the continent, and to develop a tariff common to participating countries. During their first meeting, the study group decided on three conventions that their countries would abide by: one on a common tariff nomenclature, another on customs valuation, and lastly the creation of an international body charged with providing advice on the application of the two agreements and continuing the efforts to secure uniformity and harmony among all members.

Four years later, the study group formally established the Customs Co-operation Council (CCC), now known as the World Customs Organization (WCO). On Jan. 26, 1953 in Brussels, Belgium, the council’s first session came up with the Brussels definition of value, which was widely used for customs valuation until the 1970s. The date is now known annually as International Customs Day.

Based on data from the organization, 185 customs administrations that are members of the WCO collectively process 98% of global trade. The independent intergovernmental body has made it their mission to enhance the effectiveness and efficiency of customs administrations all over the world.

This year, WCO celebrated International Customs Day with the theme “Customs Engaging Traditional and New Partners with Purpose,” with Secretary General Ian Saunders at the helm. In his first message during the celebration, the secretary general highlighted the challenges that the customs community faced over the past decade.

“The theme for 2024 is a strategic call to action, urging us to broaden our perspectives, think creatively, and embrace innovative approaches. This is essential for Customs administrations to maintain their role in facilitating global trade and ensuring security in a rapidly evolving environment” Mr. Saunders said.

The BoC also celebrated International Customs Day locally. Aligned with WCO’s engagement and partnership theme, the bureau reflected on activities they did the previous year that established strong connections with stakeholders, agencies, and customs counterparts.

According to the bureau’s website, the BoC signed a Mutual Recognition Arrangement for their Authorized Economic Operator (AEO) Programs to establish a transparent trading environment with ASEAN countries this year.

The members of the bureau, meanwhile, joined and hosted numerous events, discussions, and assemblies, as well as participated in training sessions to capacitate its personnel in the implementation of the ASEAN Customs Declaration Document.

Additionally, district collectors from all over the country also shared messages emphasizing global collaboration as they celebrated International Customs Day in their areas.

“Together, let us weave a tapestry of progress and partnership, blending the values of our customs heritage with the aspirations of a modern, interconnected world,” Port of Subic District Collector Ciriaco DG. Ugay said in a post shared by BoC’s official Facebook page.

Meanwhile, Atty. Francis T. Tolibas, district collector of the Port of Tacloban, pledged his commitment to the continuous implementation of the BoC’s mandates.

“On this International Customs Day, the Port of Tacloban pledges to further enhance its efficiency and continue to implement the mandates of the Bureau of Customs through proactive actions.”

This year, the BoC aims to publish an operations manual on the AEO programs along with initiatives that seek to increase the participation of stakeholders to support the WCO’s key calls to action. — Jomarc Angelo M. Corpuz

Converge sees sustained video streaming quality for customers this year

LISTED internet service provider Converge ICT Solutions, Inc. on Monday said customers can expect sustained video streaming quality this year.

“Our customers can look forward to the same high-quality, lossless, and seamless video experience they’ve come to expect from Converge,” Dennis Anthony H. Uy, Converge chief executive officer (ceo), said in a statement.

Converge, which has two million subscribers, recorded an average speed of 3.25 megabits per second (Mbps) for 2023, the company said, citing an internet service provider test conducted by streaming service platform Netflix.

Global network testing firm Ookla has declared Converge as the fastest internet service provider in the country, recording a download speed of 457.56 Mbps for the second half of 2023.

The company, according to Ookla, has also recorded a speed score of 123.18 for the second half.

Converge operates a fiber footprint of about 682,000 kilometers. It has deployed 7.9 million fiber ports, covering 77.85% of the country’s population.

Earlier, the company announced that it is on track to complete and activate its subsea cable by 2024, a project designed to increase bandwidth in the region and support the adoption of 5G in the Philippines.

For the nine months ending September 2023, the company recorded an attributable net income of P6.37 billion, 4.3% higher than the P6.11 billion profit registered in the same period last year, driven by higher revenues.

The company’s combined revenues for the January to September period climbed by 7.2% to P26.25 billion from P24.48 billion previously.

At the stock exchange on Monday, shares in the company gained five centavos or 0.53% to end at P9.53 apiece. — Ashley Erika O. Jose

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