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Chinese e-commerce giants make expensive bets on fast deliveries

ROBERTO CORTESE-UNSPLASH

SHANGHAI – Chinese e-commerce giants Alibaba and JD.com have opened a new front in the ongoing battle for market share, with both expanding aggressively into so-called instant retail centered around delivery speeds of 30 to 60 minutes this year.

Investors will be dissecting the strategy when JD.com reports its quarterly earnings on Tuesday and Alibaba on Thursday, as finding new avenues for growth has proven challenging for China’s largest online retailers.

Their market penetration is already high and prices for goods are under pressure due to a consumer slowdown driven by concerns about employment and wages as well as a prolonged property market downturn.

The new turf war focused on speed is coming at a high cost in the short term as the e-commerce giants look to entice consumers with hefty discounts.

JD.com’s JD Takeaway and Alibaba’s food delivery app Ele.me last month each pledged 10 billion yuan ($1.38 billion) in subsidies. JD Takeaway said it would invest the sum over a year, while Ele.me did not disclose the timeframe.

“The competition is so intense, there’s not a lot of incremental growth opportunities, so everybody is moving into everybody else’s territories and instant retail is the latest example of that,” said Jason Yu, general manager at CTR Market Research.

China’s food delivery market leader Meituan has moved to grow its business by expanding its instashopping platform, which delivers non-food goods within 30 minutes and JD.com announced its entry into food delivery in February.

“In the past people would go to JD.com to buy a mobile phone and they would deliver to you in the same day, then suddenly they could go to Meituan and have the new Apple iPhone delivered within 30 minutes. That posed a direct threat to JD.com and they moved into food delivery in response,” Yu said.

At the end of April, Alibaba expanded its instant shopping portal on its domestic e-commerce app Taobao. That gave users access to restaurants, coffee shops and bubble tea chains available on Alibaba’s Ele.me – China’s second-largest food delivery player behind Meituan – plus many other categories including pet food and apparel.

Alibaba, JD.com and Meituan did not respond to requests for comment.

Subsidised spending on instant retail from Alibaba and JD.com is being welcomed by cost-conscious consumers.

Users on JD Takeaway currently enjoy discounts of up to 20 yuan, or $2.77, per day for deliveries from restaurants including McDonald’s, Haidilao and Burger King. On Taobao’s instant shopping portal, consumers can receive a discount of 11 yuan on a bill of at least 15 yuan.

Liu Qi, 24, a small business owner in Tianjin, said he was pleased when he recently bought a coconut latte on JD Takeaway for only 5.9 yuan.

“I asked the deliveryman and he said he makes 4 yuan per delivery, so essentially, JD.com bought me a cup of coffee and delivered it to my door,” Liu said.

He was even more surprised days later when he bought a coffee on Taobao’s instant shopping portal for only 3.9 yuan. “It was 2 yuan cheaper than JD.com!” he said.

 

WAR CHESTS

While subsidizing consumer discounts for instant retail is expensive, China’s e-commerce giants have significant cash reserves. As of December 31, Alibaba, JD.com and Meituan had net cash positions of 400 billion, 144 billion and 110 billion yuan respectively, according to Morningstar analysts.

And despite the low margins inherent in the business, a renewed focus on instant retail made sense for JD.com and Alibaba in part because both firms have armies of couriers already at their disposal, analysts said.

That means there is no need for an expensive build-out of delivery infrastructure as would be required for other potential entrants like Temu-owner PDD Holdings PDD.O.

Beijing-based independent industry analyst Liu Xingliang said Alibaba and JD.com were leveraging high-frequency demand for food, coffee and bubble tea to boost lower-frequency demand for clothing, electronics and other higher-margin purchases – betting that if consumers open their apps more often, they might buy more overall.

For JD.com, the expansion into instant retail was particularly important given its traditional e-commerce business appeared to have hit a ceiling, he said.

“It must try to gain market share in new business areas.” – Reuters

Detained in The Hague, Philippines’ Duterte wins hometown mayoral election 

FORMER PRESIDENT RODRIGO R. DUTERTE — REUTERS

MANILA – Former Philippine President Rodrigo Duterte was almost certain to be elected mayor of his home city by a landslide on Monday, unimpeded by his detention at the International Criminal Court on charges of murder as a crime against humanity.

With 80% of votes counted in an unofficial tally, Mr. Duterte, who was brought to The Hague in March over his bloody “war on drugs” that killed thousands of people, was winning the Davao mayoral contest with eight times more votes than his nearest rival.

The victory during nationwide midterm elections is testament to the 80-year-old’s enduring influence in the southern city, owing to his reputation as a crime-buster that earned him the nicknames “Duterte Harry” and “the Punisher”.

Mr. Duterte’s old Facebook account was flooded with congratulatory messages from supporters, with some calling for his return to serve his people.

“Congratulations, Tatay (father) D! Let’s bring him home,” read one of the comments.
Duterte could become the first Asian former head of state to go on trial at the ICC.

His surprise arrest by Philippine police at the request of the ICC caused outrage among his army of supporters, who called it a kidnapping at the behest of a foreign court.

He has defended the anti-drugs crackdown and his legal team says his arrest was unlawful. The ICC maintains it has jurisdiction to prosecute alleged crimes committed before Mr. Duterte withdrew the Philippines from its founding treaty in 2019.

Despite the ICC’s case also including alleged killings of criminal suspects by a “death squad” in Davao while Mr. Duterte was mayor – which he has denied – analysts have said his arrest has only hardened support for him and his family, in Davao and beyond.

The former president’s two sons were also set to win posts on Monday, one reelected congressman and the other winning the contest for Davao vice mayor and likely to serve in his father’s absence.

The family’s political resilience and dominance in Davao could prove pivotal as Duterte’s popular daughter, Vice President Sara Duterte, faces an impeachment trial that could see her banned from politics for life if convicted, killing off any hopes of a presidential run.

Asked earlier on Monday about her father’s likely victory, she said plans would be made for him to be sworn in as mayor.

“The ICC lawyer said once we get proclamation papers, we will discuss how he can take oath,” she said. – Reuters

PHINMA Corp. to hold Annual Stockholders’ Meeting on June 5 via remote communication

 

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Container shippers win China-US tariff reprieve, await volume rebound

A drone view shows shipping containers from China at the Port of Los Angeles in Wilmington, California, Feb. 4, 2025. — REUTERS

BERLIN/LOS ANGELES – The container shipping industry on Monday welcomed an agreement between the United States and China to temporarily slash punishing tariffs, saying it expected to be buoyed by a resulting recovery in bookings from China to the U.S.

The United States will cut extra tariffs it imposed on Chinese imports in April to 30% from 145% and Chinese duties on U.S. imports will fall to 10% from 125% for the next 90 days, the two sides said on Monday.

Trade between the world’s two largest economies plummeted in the midst of the standoff, prompting container shipping companies like MSC and Cosco to suspend regular routes or cancel individual voyages. Others considered switching to smaller ships.

It is not yet clear if the reprieve will spark a big rebound in shipments to the United States. Some Chinese factories were preparing for a bounce.

“It’s welcome news that these guys are talking and that the numbers have been pulled down from those sky-high levels,” said Gene Seroka, executive director of the Port of Los Angeles – the busiest U.S. seaport and the No. 1 gateway for ocean imports from China. He was referring to the tariff rates.

“There’s still much more work in front of us,” Seroka said, adding that 30% tariffs on goods for the world’s leading export nation remain significantly higher than before President Donald Trump took office.

A rebound in shipping demand could send off-contract spot rates for vessel space higher.

Importers of critical goods including hospital supplies like syringes, IV apparatus or ventilators could rush in products if supplies are running low, Seroka said.

Still, other importers may take a wait-and-see approach to 30% tariffs that would drive up prices for shoppers, he said.

Retailers like Walmart, Target and Home Depot account for about half of global container shipping volume.

The month of May is when U.S. retailers usually place orders for year-end holidays. Those goods for Halloween, Thanksgiving and Christmas typically land at U.S. ports between August and October.

“I don’t know that many retailers are going to say, ‘Hey, for our biggest time of the year, 30% is OK’,” Seroka said.

Mike Abt, co-president of family-owned Abt Electronics in Chicago, said the family-owned seller of items including refrigerators, microwaves, computers and televisions is sitting tight and working down inventories squirreled away before tariffs went live.

“Everyone wants consistency and that’s been the hard part of this whole thing. It’s like a game of Risk, you really don’t know what the right answer is,” Abt said, referring to the popular strategy board game.

 

TURNING THE SHIP?

Last month, London’s Drewry Shipping Consultants Ltd said 2025 worldwide container port volume could fall 1% due to Trump’s trade policies, rather than grow 2.3% as previously expected.

“Assuming no hiccups along the way (in China-U.S. trade talks), we can safely expect to raise our growth projections for the container market shortly,” Simon Heaney, Drewry’s senior manager of container research, said on LinkedIn.

To that end, German container shipping firm Hapag-Lloyd said it expects bookings from China to the U.S. to increase.

Hapag-Lloyd continued sailing during the collapse of Chinese cargo shipments to the U.S., albeit with plans to downsize ships. That move could put the carrier at an advantage over rivals that culled sailings, should customers rush in goods during the 90-day reprieve.

“Originally, we had planned to use smaller ships for transports from China to (the U.S. coasts) but may reverse that if demand is strong,” Hapag-Lloyd said in a statement.

Maersk MAERSK CEO Vincent Clerc said on Thursday that in two weeks the Danish firm had removed 20% of capacity on the China-to-United States route and transferred it to other routes.

Maersk could switch that back as quickly if customers ask for it, Clerc said.

The Dow Jones Transportation Average, a barometer for the U.S. sector, gained 7% on Monday. Elsewhere, shares of Hapag-Lloyd and Maersk posted gains of roughly 13% and 11%, respectively, while stock of China’s Cosco rose 2%.

Tariffs at the 20% level did not stop shippers from front-loading in March and April, so the current 30% level should encourage shippers to pull forward demand to beat a possible August tariff hike, said Judah Levine, head of research at freight booking and payments platform Freightos.

Average transit time on the Transpacific trade is 22 days, so customers will take the 90-day window of opportunity to ship as many goods as possible into the United States, said Peter Sand, chief analyst at pricing platform Xeneta. “This will put upward pressure on freight rates.” – Reuters

Pentagon halting gender-affirming healthcare for transgender troops, memo says

STOCK PHOTO | Image by David Mark from Pixabay

WASHINGTON – The Pentagon is halting gender-affirming healthcare for transgender troops as it moves to implement President Donald Trump‘s plan to kick them out of the U.S. military, according to a memo seen by Reuters on Monday.

The instructions from the Defense Department barred any new hormone treatments as well as any surgical procedures for transgender troops, the memo said.

“I am directing you to take the necessary steps to immediately implement this guidance,” Stephen Ferrara, the acting assistant secretary of defense for health affairs, said in the memo.

The Pentagon referred questions to the Defense Health Agency, which did not immediately respond to a request for comment.

Shannon Minter of the National Center for Lesbian Rights said that the abrupt termination of healthcare was “needlessly disrespectful and cruel.”

“It is shameful that our nation’s military would treat any service member this way,” Ms. Minter said.

One transgender service member, speaking on condition of anonymity out of fear of being targeted, called the decision “the latest slap in the face” to troops serving honorably.

“If there was any doubt left, there is not anymore: transgender service members are no longer entitled to the same standard of medical care as their peers,” the service member said.

The U.S. Supreme Court on May 6 permitted Mr. Trump’s administration to implement his ban on transgender people in the military, allowing the armed forces to discharge the thousands of current transgender troops and reject new recruits while legal challenges play out.

Reuters first reported last week a memo showing that U.S. Defense Secretary Pete Hegseth issued instructions to start kicking out transgender troops who do not elect to leave on their own by June 6.

There are 4,240 U.S. active-duty and National Guard transgender troops, officials have said. Transgender rights advocates have given higher estimates.

Mr. Trump signed an executive order in January, after returning to the presidency, that reversed a policy implemented under his predecessor Joe Biden that had allowed transgender troops to serve openly.

A Gallup poll published in February found that 58% of Americans favored allowing openly transgender individuals to serve in the military, but the support had declined from 71% in 2019.

A former Fox News host, Mr. Hegseth has embraced conservative stances on culture war issues, including eliminating diversity initiatives at the Pentagon. Mr. Hegseth had made clear his opposition to gender-affirming care for transgender troops in a post on social media last month.

Re-posting an article that said the Pentagon would resume treatments for transgender troops, Mr. Hegseth said: “If this is true – we will find any way possible to stop it.”

“Taxpayers should NEVER pay for this lunacy,” Mr. Hegseth added. – Reuters

BYD factory delayed in Brazil to be ‘fully functional’ by end-2026, says official

REUTERS

RIO DE JANEIRO – Chinese electric car maker BYD’s new factory in Brazil will be “fully functional” by December 2026, after its operations were delayed because of an investigation into labor abuses, Bahia state labor secretary Augusto Vasconcelos said in a video on Monday.

By the end of this year, the factory should start producing cars from semi-finished kits, he added.

“A new schedule is being established so that by December 2026 the factory will be fully functional with the expectation of generating 10,000 jobs,” said Vasconcelos in the video published to social media.

The news comes as Bahia Governor Jeronimo Rodrigues travels to China with President Luiz Inacio Lula da Silva, discussing plans for BYD and the auto industry, Vasconcelos said.

Operations will begin with the assembly of vehicles in 2025, as the factory ramps up with “progressive nationalization of the best-selling models in Brazil”, said BYD in a statement.

With 76,713 vehicles sold in Brazil throughout the year, the company registered a growth of around 328% compared to the 17,937 sold in 2023, according to a January press release.

BYD’s investment in Brazil – its biggest market outside of China – aims to turn a former Ford factory into a manufacturing complex with capacity to make 150,000 electric cars per year. The project was tarnished in December with accusations of labor abuses at the worksite.

The Chinese company’s bet on Brazil includes the acquisition of mining rights to areas rich in lithium, a mineral commonly used to build batteries for electric vehicles.

The plant was expected to have started making cars in Brazil at the beginning of this year, but delays involving the labor probe and heavy rains affected the timeline, said Julio Bonfim, head of the metalworkers union of Camaçari, Bahia.

To assemble the vehicles from the imported kits from China, BYD is set to hire around 1,000 workers in Brazil this year, Mr. Bonfim told Reuters, far short of the 10,000 the Chinese firm first promised.

Throughout the project, BYD estimates that it will create 20,000 jobs directly and indirectly, said the firm.

Despite the delay, Mr. Bonfim said the new timeline is good news, and that next year he expects the hirings to increase as the firm prepares to build vehicles entirely in the country. – Reuters

FDI net inflows drop to $529M in Feb.

REUTERS

By Aubrey Rose A. Inosante, Reporter

NET INFLOWS of foreign direct investments (FDI) dropped sharply in February due to a high base, the Bangko Sentral ng Pilipinas (BSP) said on Monday.

Uncertainty due to the Trump administration’s shifting policies also affected sentiment, leading to lower inflows, analysts said.

Latest BSP data showed that FDI net inflows declined by 61.9% to $529 million in February from $1.388 billion in the same month a year ago.

Net Foreign Direct Investment“This decrease was primarily attributed to base effects,” the central bank said in a statement.

Month on month, net inflows likewise went down by 27.63% from the $731 million recorded in January.

The drop in FDI net inflows in February was largely driven by the 85.9% decrease in nonresidents’ net investments in equity capital, other than the reinvestment of earnings, to $108 million from $764 million.

Broken down, equity capital placements dropped by 82.96% to $146 million that month from $857 million a year prior, while withdrawals slid by 58.06% to $39 million from $93 million.

The BSP said the bulk of equity placements in February mostly came from Japan (56%), followed by the United States (11%), Ireland (10%) and Malaysia (5%).

“These investments were largely directed towards the manufacturing, financial and insurance, real estate, and information and communication industries,” the central bank said.

Reinvestment of earnings dropped by 13.1% year on year to $73 million from $84 million.

Overall, foreigners’ investments in equity and investment fund shares plunged by 78.77% to $180 million in February from $848 million a year prior.

Meanwhile, nonresidents’ net investments in debt instruments of local affiliates also fell by 35.4% to $348 million in February from $540 million in the same month in 2024.

JANUARY TO FEBRUARY
During the first two months of 2025, total FDI net inflows likewise declined by 45.2% to $1.26 billion from $2.301 billion in the same period last year.

Foreigners’ investments in equity capital other than the reinvestment of earnings slumped by 74% to $196 million in the January-February period from $753 million a year prior.

Equity placements dropped by 74% year on year to $249 million, while withdrawals declined by 73.9% to $53 million.

These placements were mostly from Japan (53%), the US (16%), Singapore (8%), Malaysia (6%) and Ireland (6%) and mainly went to the manufacturing sector.

Meanwhile, nonresidents’ reinvestment of earnings increased by 12.6% year on year to $197 million in the first two months from $175 million.

Lastly, net investments in debt instruments went down by 36.8% to $867 million from $1.373 billion in the same period last year.

“The latest year-on-year and month-on-month decline in the latest FDI data… could be attributed to uncertainties on possible protectionist measures by US President Donald J. Trump,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message. “Trump’s trade wars could slow down exports, as well as FDIs that are export oriented.”

“The decline in FDIs may be seen as the waiting and hesitant behavior from investors as they wait for clearer directions on global trade,” said Reinielle Matt M. Erece, an economist at Oikonomia Advisory and Research, Inc.

Since returning to the White House in January, Mr. Trump has introduced a slew of protectionist measures, which he said meant to encourage investments in the United States to restore its dominance. These measures include various import tariffs, with some targeting specific products.

In April, he announced “reciprocal” tariff rates to be imposed on America’s largest trading partners, including the Philippines. These higher duties have been suspended until July, with most countries now negotiating with the US.

Mr. Ricafort added that foreign investors were on wait-and-see mode prior to the release of the implementing rules and regulations (IRR) of the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Act, which was signed into law in December.

The CREATE MORE Act further reduces the corporate income tax to 20% from 25% for registered business enterprises.

The IRR for the law released in mid-February now gives investors more clarity, Mr. Ricafort said.

In the coming months, Mr. Erece said investment growth may slow with the global economic outlook expected to take a hit due to the Trump administration’s trade policies.

“Easing monetary policy, better business environment, and a resilient domestic economy may be ways to still attract investments in the country,” he added.

BSP Governor Eli M. Remolona, Jr. told Bloomberg last week that they are open to cutting rates by a further 75 basis points (bps) this year amid cooling inflation.

Last month, the central bank slashed benchmark borrowing costs by 25 bps, bringing the policy rate to 5.5%. It has now reduced benchmark rates by a total of 100 bps since it kicked off its rate-cut cycle in August last year.

Over 14,000 MW of new power projects set to go online by 2030

OVER 14,000 megawatts (MW) of new power projects nationwide are committed to go online in the next five years, according to the Department of Energy (DoE).

Renewable energy projects made up nearly 82% of the total commitments with 11,625.31 MW in capacity, data from the DoE as of March 31 showed.

Broken down, solar power projects are expected to deliver 8,431.19 MW of capacity to comprise the bulk of the committed renewable projects. This was followed by wind power projects with 2,233.24 MW, and hydropower projects with 836.38 MW.

Meanwhile, geothermal and biomass accounted for 74.22 MW and 50.28 MW, respectively.

On the other hand, for non-renewable energy projects, those that run on coal would generate 1,570 MW of capacity, followed by natural gas with 880 MW, and oil-based with 170.74 MW.

There are also battery energy storage systems (BESS) lined up to be operational by 2030 that are capable of storing 594 MW of electricity.

A BESS uses batteries to store electrical energy from the grid and releases it when needed to augment supply or improve power quality.

By location, Luzon has the majority of committed power projects with a total capacity of 11,736.22 MW.

Committed energy projects in the Visayas and Mindanao totaled 2,053.68 MW and 591.17 MW, respectively.

Committed projects refer to those that are already in the construction phase or have a financial close in place.

For this year alone, power projects with a total capacity of 5,632.45 MW are expected to go online, the DoE data showed.

This would serve as additional power supply as the Energy department earlier said that forecasted demand for 2025 would reach 14,769 MW for Luzon, 3,111 MW for the Visayas, and 2,789 MW for Mindanao.

In February, the DoE announced that the third round of green energy auction (GEA-3) was able to attract 7,500 MW worth of bids to construct renewable energy plants, exceeding the auction goal of 4,650 MW.

The auction round offered capacities for pumped-storage hydro, impounding hydro, and geothermal.

On top of this, the government is set to conduct two more auctions this year focusing on integrated renewable energy and energy storage systems and offshore wind.

The GEA program promotes renewable energy as a primary source of energy, with bidders undergoing competitive selection. As a flagship government initiative, the program is seen to contribute to the country’s goal of achieving a 35% share in the power generation mix by 2030.

“The GEA underscores the Department’s commitment to creating a fair and competitive environment for renewable energy development, ensuring transparency, innovation, and deployment of cost-effective renewable energy technologies across the country,” the DoE said. — Sheldeen Joy Talavera

Demand for domestic debt issuances likely to rise

BW FILE PHOTO

THE National Government’s (NG) domestic debt offerings could see higher demand in the coming months after the Bureau of the Treasury (BTr) said it is unlikely to make foreign or large bond issuances this year.

“The BTr’s signal to skip foreign or retail bond issuances for the rest of 2025 reflects comfortable cash buffers and likely confidence in meeting financing needs through regular domestic auctions. This could also be a strategy to reduce foreign exchange risk and avoid locking in foreign debt at potentially high global rates,” Philippine Institute for Development Studies Senior Research Fellow John Paolo R. Rivera said in a Viber message.

“For the secondary market, this supply restraint could lead to stronger demand and firmer pricing for existing government securities, especially in the medium to long end of the curve,” he said.

Last week, National Treasurer Sharon P. Almanza said that the government is unlikely to issue another global bond this year as it has almost completed its program for foreign borrowings.

The government is also not looking at any more large offerings like a Sukuk or a retail Treasury bond issuance, she said, adding that the BTr will add benchmark fixed-rate Treasury notes (FXTN) to its issue lineup.

The BTr last month raised P300 billion from its offering of new 10-year FXTN, 10 times the initial P30-billion program. It borrowed an initial P135 billion via the papers at the rate-setting auction and held a public offer.

The notes fetched a coupon rate of 6.375%. Accepted bid yields ranged from 6% to 6.4%, resulting in an average rate of 6.286%.

The FXTN offer was held under a new issuance format meant to establish a new benchmark bond and targeting institutional investors like corporates, cooperatives, trust funds, retirement funds, and provident funds.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the FXTN issue format would give the BTr “more wholesale funding sources with bigger amounts and rates.”

This would help diversify and better hedge the government’s borrowing requirements, he added.

“Borrowing more from domestic sources amid lower rates and the benefit of being shielded from foreign exchange risk may be a good strategy to better manage the country’s debt,” Reinielle Matt M. Erece, economist at Oikonomia Advisory and Research, Inc., said in a Viber message.

In January, the government raised $3.29 billion from its sale of US dollar and euro bonds, its first global bond offer for the year.

The NG’s commercial borrowing program is pegged at $3.5 billion this year.

This year’s overall financing program is set at P2.55 trillion, of which about 20% or P507.408 billion will come from foreign sources and about 80% or P2.04 trillion will come from domestic sources.

The government borrows from local and external sources to help fund its budget deficit, which is capped at P1.54 trillion or 5.3% of gross domestic product this year.

LOWER RATES
Meanwhile, domestic bond yields may continue to go down this year with the Bangko Sentral ng Pilipinas (BSP) expected to cut rates further, Mr. Ricafort said.

This would help bring down the government’s borrowing costs, he added.

“Yields may soften slightly, especially with the BSP adopting a more dovish tone and first-quarter gross domestic product (GDP) growth coming below target, both pointing to potential rate cuts in the second half of the year,” Mr. Rivera likewise said.

Analysts have said that benign inflation and weak GDP growth in the first quarter give the Philippine central bank ample room to cut benchmark rates further.

Headline inflation sharply slowed to 1.4% in April from 1.8% in March and 3.8% a year prior. This brought average inflation in the first four months to 2%, at the low end of the BSP’s 2-4% annual target.

Meanwhile, the Philippine economy expanded by 5.4% in the first quarter, a tad faster than the revised 5.3% in the previous quarter but sharply slower from the 5.9% growth in the same period in 2024.

This was also well below the government’s 6-8% GDP growth target for the year.

BSP Governor Eli M. Remolona, Jr. told Bloomberg last week before the GDP report that they are open to cutting rates by a further 75 basis points (bps) this year amid cooling inflation.

Last month, the Monetary Board resumed its easing cycle after an unexpected pause in February, cutting benchmark rates by 25 bps to bring the policy rate to 5.5%. Its next meeting is on June 19. — Aaron Michael C. Sy

PHL construction industry’s modernization to boost resilience amid trade uncertainties

BW FILE PHOTO

THE PHILIPPINE construction industry can improve its resilience amid ongoing global trade uncertainties by modernizing its operations and strengthening domestic supply chains.

“The tariff shifts introduced by US President Donald J. Trump have triggered ripple effects across global supply chains, affecting everything from raw materials to technology imports,” Vitaly Berezka, regional spokesperson for APAC (Asia-Pacific) at Austrian construction technology firm PlanRadar, said in an e-mail. “For the Philippine construction and property sectors, the most immediate risk lies in rising costs and potential delays tied to sourcing construction inputs.”

“The imposition of reciprocal tariffs by President Trump has certainly brought headwinds to the local construction industry. These tariffs will disrupt the construction supply chain, and hence might impact availability, lead times and pricing of imported construction materials,” Jason C. Valderrama, president and chief executive officer at construction firm JCV & Associates, said in an e-mail.

According to Mr. Berezka, the Philippines has an opportunity to position itself as a regional innovation hub as global firms rethink supply chains.

“By accelerating investment in digital infrastructure and construction technology, the country can increase project efficiency, attract forward-thinking investors, and strengthen its long-term resilience,” he said.

Local construction firms should push for digitalization to let them adapt to evolving global conditions accordingly, Mr. Berezka said.

“Embracing construction technologies like AI-powered platforms, cloud-based documentation, and digital twins will provide the visibility and flexibility needed to adapt in real-time to supply chain or regulatory shocks.”

In particular, they can adopt property technology or “proptech” platforms and digital construction tools, he said.

Construction-related technologies could also help these companies optimize procurement, automate workflows, and reduce material waste, he added.

AI is becoming a “powerful equalizer” in the construction industry amid the global uncertainties, he said, adding that using AI for predictive analytics can help construction managers anticipate delays or cost overruns and automate risk detection.

AI can also streamline reporting and compliance, which is crucial amid shifting regulatory and trade landscapes, Mr. Berezka said.

“Diversifying supplier bases and investing in local supply chains can reduce vulnerability to external tariff policies and logistical constraints. The Philippines has an opportunity to grow its internal capacity while still attracting international partnerships,” he added.

Mr. Valderrama said that with muted US demand for construction materials likely to lead source markets to consider exporting to the Philippines to skirt the higher tariffs, the Philippines must ramp up the development and completion of key infrastructure projects, address the housing backlog, and elevate the country’s manufacturing sector.

The construction industry must also widen its in-country and offshore supply pool, pursue vertical integration, utilize technologies, and adopt modern construction methods and sustainability practices, he said.

Mr. Berezka likewise said that industry players must collaborate with the government on long-term infrastructure plans to incentivize innovation and create a stable regulatory framework that encourages digital adoption and sustainable development.

“Resilience in this era will depend not just on withstanding disruption, but on using it as a catalyst to modernize and evolve. The future belongs to construction ecosystems that are digitally enabled, operationally agile, and strategically diversified.” — Beatriz Marie D. Cruz

SEC hopes for Maynilad’s P49-B IPO by midyear

MAYNILAD WATER SERVICES, INC.

THE Securities and Exchange Commission (SEC) is hoping the P49-billion initial public offering (IPO) of Pangilinan-led Maynilad Water Services, Inc. will proceed by midyear.

“We’re hoping it really pushes through middle of the year,” SEC Commissioner McJill Bryant T. Fernandez told reporters last week.

“We’re waiting for the subsequent submissions in relation to their application,” he added.

Maynilad is targeting an offer period from June 25 to July 2, with a listing date on July 10, based on its latest prospectus dated March 14. The final offer price will be disclosed to regulators on June 24. The IPO will involve up to 2.46 billion common shares priced at a maximum of P20 each.

Despite tariff uncertainties, Maynilad Chairman Manuel V. Pangilinan said the company is pushing through with its market debut this year.

“We have to go public by the early part of 2027. We just want to probably finish and comply with the franchise law of Maynilad. I’d like to encourage them to proceed,” he said.

Maynilad’s legislative franchise requires it to publicly offer at least 30% of its outstanding capital stock by January 2027.

The Philippine Stock Exchange expects six IPOs this year, though only one listing has been completed so far — Cebu-based fuel retailer Top Line Business Development Corp. in April.

On the planned GCash IPO, Mr. Fernandez said the SEC has not had any formal or informal discussions with the mobile wallet platform or its underwriters. He noted that no IPO-related filings have been submitted to the commission.

“Formally or informally, we haven’t had any discussion with GCash,” he said.

Last month, Globe Telecom, Inc. signaled potential delays in GCash’s public listing, citing tariff-related uncertainties. Globe holds a 36% stake in Globe Fintech Innovations, Inc. (Mynt), which operates GCash through G-Xchange, Inc.

In March, the SEC approved a 15% initial public float for select companies seeking to go public through exemptive relief, subject to strict conditions. The move followed a request by GCash for regulatory relief from the 20% minimum public float requirement for IPOs.

Separately, Mr. Fernandez said the SEC is currently reviewing three companies under its strategic regulatory sandbox, established through SEC Memorandum Circular No. 9 issued in April last year.

The sandbox program aims to develop the Philippine financial market by allowing companies to test innovative products and services in a controlled live environment before full-scale adoption.

“We’re looking at three. We have a new one. We have approved the two. We’re just waiting for the respective platforms to be completed. They have to develop their information technology (IT) platform. We want to launch,” he said.

“These will be capital market- and IT-related. Online and capital market. For the third one, it is not approved yet. We raised questions on their proposal, but offhand, we’re favorably considering them, except that we have to refine,” he added.

Metro Pacific Investments Corp., which holds a majority stake in Maynilad, is one of three Philippine subsidiaries of Hong Kong-based First Pacific Co. Ltd., along with Philex Mining Corp. and 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. — Revin Mikhael D. Ochave

San Miguel Food and Beverage, Inc. to conduct virtual Annual Meeting of Stockholders on June 4

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS 

June 4, 2025

The 2025 Annual Meeting of the Stockholders of San Miguel Food and Beverage, Inc. (the “Company”) will be held on June 4, 2025, Wednesday, at 2:00 p.m. As unanimously approved by the Board of Directors at its meeting on March 5, 2025, the Company will not hold a physical meeting. The meeting will be conducted virtually and streamed live through the Company’s website at https://www.smfb.com.ph/stockholdersmeeting_2025. Stockholders can therefore only attend the meeting by remote communication, by voting through the sending of ballots, or the appointment of a proxy.

The agenda of the meeting is as follows:

  1. Call to Order
  2. Certification of Notice and Quorum
  3. Approval of the Minutes of the 2024 Annual Stockholders’ Meeting
  4. Presentation of the Annual Report and Approval of the 2024 Audited Financial Statements
  5. Ratification of Acts and Proceedings of the Board of Directors and Corporate Officers
  6. Appointment of External Auditor and Ratification of External Auditor Fees
  7. Election of the Board of Directors
  8. Other Matters
  9. Adjournment

The Company’s Definitive Information Statement on SEC Form 20-IS with its annexes (the “DIS”), including Management’s Discussion and Analysis of Financial Position and Financial Performance, 2024 Audited Consolidated Financial Statements and interim unaudited financial statements for the first quarter of 2025, has been posted on the website and can be accessed via the QR code below. It may also be found at PSE Edge.

The rationale and explanation of each relevant Agenda item requiring shareholder approval may be found in Appendix 1 of the Notice attached to the DIS. The Company’s dividend policy, acts and resolutions of the Board of Directors from June 5, 2024, and draft of the minutes of the 2024 annual stockholders’ meeting for approval, may likewise be found in the DIS. The said draft of the minutes is also separately posted on the website at https://www.smfb.com.ph/disclosures. Questions and comments may be sent by email to smfbasm@sanmiguel.com.ph.

Votes will be cast through ballots or proxies, the deadline for submission of which is May 21, 2025.  A sample of a ballot/proxy is attached to the DIS and available for download at the website. For an individual, your ballot/proxy must be accompanied by a valid government-issued ID with a photo. For a corporation, your proxy must be accompanied by a Corporate Secretary’s certification setting the representative’s authority to represent the corporation in the meeting. Ballots and proxies may be sent through email at smfbasm@sanmiguel.com.ph or by mail to the office of SMC Stock Transfer Service Corporation (STSC) at the 2nd Floor, SMC Head Office Complex, 40 San Miguel Avenue, Mandaluyong City 1550. Proxies need not be notarized. Validation of proxies will be on May 28, 2025, 10:00 a.m. at the office of STSC. Only the stockholders attending through proxies or who have submitted ballots, all of whom have been validated to be stockholders of record of the Company as of May 5, 2025, will be considered in computing stockholder attendance at the meeting and in determining quorum.

The Company’s 2024 Annual Report on SEC Form 17-A is available for download at https://www.smfb.com.ph/disclosures, as well as at PSE Edge. Upon written request, the Company will provide the stockholder with a copy of the Annual Report, DIS, and/or 2025 first quarter report on SEC Form 17-Q, at no cost.

(Sgd.)  

Alexandra Victoria B. Trillana 

Corporate Secretary

 

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