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Senate OK’s P100 wage increase on 2nd reading

BW FILE PHOTO

By John Victor D. Ordoñez, Reporter

THE PHILIPPINE SENATE on Wednesday approved on second reading a bill calling for a P100 ($1.78) across-the-board minimum wage increase for workers in the private sector.

The increase will ensure a “living wage” for the Filipino workforce, according to Senate Bill No. 2534 or the proposed Wage Increase Act of 2023, which was sponsored by Senator Jose “Jinggoy” P. Estrada, Jr.

The measure seeks to improve the living conditions of Filipino families, Senate President Juan Miguel F. Zubiri told plenary.

“The Senate is united in addressing the needs of Filipino workers,” he said in Filipino. “The Senate hears the call of the nation for decent pay, and we are not just listening but taking action too.”

The Senate president expects the bill to be approved on third and final reading next week.

The Employers Confederation of the Philippines (ECoP) said a legislated wage would only benefit 16% of the country’s workforce.

“About 84% of the working force, or those in the informal sector, would not benefit from the legislated wage increase, and only about 10% would temporarily benefit from it only for a few months,” ECoP President Sergio R. Ortiz-Luis, Jr. said by telephone.

“A P100 legislated wage hike is sure to be catastrophic inflationary,” he added.

He also said it betrays the Philippines’ “erratic policies” that foreign investors shun. “You have a process with the regional wage boards and all of a sudden, you see a legislated wage increase. What do you think investors will say?”

A Filipino family of five needs at least P13,797 a month or P460 a day to meet their basic needs, according to the Philippine Statistics Authority.

A bloc of congressmen has also filed a bill seeking a P750 daily wage hike for private sector workers, including those in special economic zones, freeports and agriculture.

Philippine labor groups have backed a legislated wage hike, saying it would unleash consumer spending power and raise worker pay above poverty levels.

Calixto V. Chikiamco, president of the Foundation for Economic Freedom, said the proposal is bad for the economy and could worsen inflation.

“Worse, a national wage hike doesn’t take into consideration the different cost factors and employment figures across regions,” he said in a Viber message. “It will likely cause a wage price spiral that will harm Filipino workers in the long run.”

He said the legislated wage increase would cause more joblessness as companies adjust to higher wages while suffering from stagnant productivity through downsizing.

Inflation eased to 2.8% in January from 3.9% in December and 8.7% a year ago, the slowest in three years.

Metro Manila’s daily minimum wage rose by P40 to P610 in June, much lower than the P570 increase sought by some labor groups.

The International Labour Organization (ILO) expects the global jobless rate to rise to 5.2% this year from 5.1% a year earlier. In a report last month, the ILO said the global labor market is set to “deteriorate moderately” because of increased joblessness in advanced economies.

“The erosion of real wages and living standards by high and persistent inflation rates and rising costs of housing is unlikely to be offset quickly,” it said.

Jose Enrique A. Africa, executive director of think tank Ibon Foundation, said a legislated wage hike would help workers more than the regional wage-setting system given rising prices. It would also prop up the economy by boosting household spending, he added.

“Wage increases will also be spent locally and on micro, small and medium enterprises including informal enterprises in their communities, which will spur local economic activity,” he said in a Viber message.

Marikina City Rep. Stella Luz A. Quimbo on Feb. 12 said the government should focus on easing inflation and boosting productivity to ease the risks of wage increases.

The across-the-board wage increase is a starting point to address the shortcomings of the country’s wage-setting system, Josua T. Mata, secretary-general of the Sentro ng mga Nagkakaisa at Progresibong Manggagawa, said in a Viber message.

“Should it be legislated, P100 could still ease the burden on minimum wage earners,” he said. “This would in turn motivate them to do better.”

A PwC Philippines survey in August showed that 29% of Filipino workers were looking for new jobs and demanding higher pay amid spiraling prices.

Labor groups have urged the government to reform the regional wage-setting system to ensure wages keep up with the rising cost of living.

Labor Secretary Bienvenido E. Laguesma has said his agency would defer to Congress on legislated wage hike proposals.

PHL household goods sector may grow by 7.5%, says BMI

FREEPIK

THE PHILIPPINES’ household goods sector may grow by 7.5% this year to P270.4 billion ($4.8 billion) from last year as rising incomes boost consumer spending, BMI Country Risk & Industry Research said.

In a report dated Feb. 13, BMI said spending on household goods would likely grow by 7.1% in the next five years to P354 billion by 2028.

“Improvements in the housing market and the increasing number of households in the middle- and upper-income brackets will encourage expenditure on aspirational products, such as consumer electronics and home furnishings,” it said.

Colliers Philippines earlier said vacancies in the secondary residential market dropped to 16.8% at the end of December from 17.1% a year earlier. It recorded a take-up of about 23,400 condominium units in the National Capital Region pre-selling market last year, better than 21,600 units sold in 2022.

The property consultancy expects more than 7,000 condominium units to be completed this year.

BMI said the Filipino household goods consumer market is dynamic and has a mix of local and international retailers, BMI said. Consumers can access a wide range of products from electronics to white goods through physical stores and e-commerce platforms.

The research firm noted that several domestic chains in the Philippines such as SM Home compete with Europe-based and global rivals such as Swedish IKEA and Hong Kong-based Japan Home Centre.

Retail formats also vary in the country, BMI said, citing out-of-town superstores, small city center display stores and a robust online sales sector.

“Over the medium term, the market will average steady growth, with all segments apart from leisure items outperforming,” BMI said.

The average income of Filipino households fell by 2% to P307,190 in 2021 from 2018, according to data from the local statistics agency. The average spending of Filipino families also dropped by 4.1% to P228,800.

The poverty incidence also rose to 18.1% in 2021 from 16.7% in 2018, equivalent to 19.992 million poor Filipinos.

The Philippines seeks to cut the poverty incidence — the proportion of Filipinos whose incomes fell below the per capita poverty threshold — to 9% by 2028.

BMI expects the Philippine economy to grow by 6.2% this year as easing inflation and unemployment support household spending. Household spending expanded by 5.6% last year from 8.3% a year earlier.

It earlier said it expects inflation to fall back to trend this year, offering a respite for real household incomes after a rough 2023. Labor market conditions are very tight by historical standards and the unemployment rate is now at record lows, it added.

Inflation slowed to 2.8% in January from 3.9% in December and 8.7% a year ago, the slowest since October 2020. It was also the second straight month that inflation was within the central bank’s 2-4% target.

The unemployment rate fell to a record 4.3% in 2023 from 5.4% a year earlier, equivalent to 2.19 million jobless Filipinos compared with 2.67 million in 2022. — Keisha B. Ta-asan

Economists ask Marcos gov’t to push easing foreign ownership cap while cutting red tape

PHILIPPINE STAR/KJ ROSALES

THE GOVERNMENT of President Ferdinand R. Marcos, Jr. should push easing foreign ownership restrictions in the 1987 Constitution while cutting bureaucratic red tape to attract foreign direct investments (FDI), according to economists.

“Removing the specific restrictive provisions in the 1987 Constitution is a necessary but not a sufficient condition to encourage more foreign direct investments,” Former Finance Secretary Margarito B. Teves told a forum on Wednesday.

“Just kindly try to remove all those restrictive economic provisions which we can specify and put us on par with our colleagues in ASEAN (Association of Southeast Asian Nations),” he added.

Mr. Teves said the Philippines has one of the most restrictive economies in Southeast Asia, and it doesn’t help that these limits are in the country’s basic law.

“We’re the only country whose restrictive economic provisions are embodied in the Constitution,” he said. “No other country in Asia… has included these provisions in the Constitution.”

FDI net inflows rose by 27.8% to $1.04 billion in November from a year earlier, the central bank said on Monday.

The FDI Regulatory Restrictiveness Index, which measures statutory restrictions on FDIs in 22 economic sectors across 69 countries, has not taken into account the country’s liberalized public sector, Toby Melissa C. Monsod, an economics professor from the University of the Philippines, told the forum.

She said the government should delay Charter change until it reaps the benefits of potential FDIs in sectors opened up by the amended law that took effect in April. The law allows 100% foreign ownership in telecommunications, airlines and railways.

“The FDI restrictiveness index still does not incorporate gains from the Public Sector Act,” she said. “My question is why don’t we see what happens?”

The Organisation for Economic Co-operation and Development’s FDI index gauges the restrictiveness of a country’s FDI rules by looking at foreign equity restrictions, discriminatory screening or approval mechanisms, restrictions on key foreign personnel and operational restrictions.

“I played with it,” Ms. Monsod said, referring to the index. “If you put that in, the [Philippine] index goes down by about 5%.”

“Relaxing equity restrictions may not be necessary and at best, its impact will only be one-eighth or one-fourteenth of what could be obtained if we worked on controlling corruption or human capital,” she added.

But Rutcher Lacaza, a supervising legislative staff officer at the House of Representatives Congressional Policy and Budget Research Department, said it’s not enough that Philippine FDIs continue to increase.

“Despite growing FDI inflows, the Philippines continues to lag behind our peers in the region,” he said at the forum.

Mr. Teves said the legal challenge to the Public Service Act at the Supreme Court might discourage foreign investors from coming in.

“We want to see a situation where foreign investors would be encouraged really to come in rather than have that element of uncertainty or doubt that the Supreme Court might or might not support Congress for its act,” he told BusinessWorld on the sidelines of the forum.

Raul V. Fabella, a retired professor at the University of the Philippines School of Economics, said any economic gains from existing laws outweigh the Philippines’ tight investment climate.

“Even if the gains of the Public Service Act are there, you will still find some reason because power is still not competitive,” he said. “You [should] improve the investment ecology whenever you can, and whenever you can, and one of them is by lifting Article 12.”

The clause mandates the state to protect Filipino enterprises against unfair foreign competition and trade practices and limits land ownership to Filipino citizens and corporations that are at least 60% Filipino-owned.

Mr. Fabella said the Philippines’ 22% savings rate is behind Asian peers including China (45%), Singapore (43%), Vietnam (33%) and Thailand (27%).

Lack of savings, an important source of economic growth, makes a country highly dependent on foreign investments, which also come with risks.

Senators and congressmen are studying several proposals to amend the Constitution including lifting foreign ownership limits.

The Philippines’ most restrictive sectors are agriculture, forestry and fisheries, telecommunications, media, business services and transport, Mr. Lacaza said.

Jose Enrique A. Africa, executive director at think tank IBON Foundation, said the Philippines should not focus on being “at par” with its regional peers especially if it does not ensure national development.

“There’s no sense in arguing that the objective of policy is to follow what others are doing because the real policy question is what is needed and should be done,” he said in a Viber message.

“That grossly erroneous notion is behind so much of Philippine economic policy making in the last four decades being a ‘race to the bottom’ to liberalize without meaningful development in national productive capacities in agriculture or industry,” he added. — Beatriz Marie D. Cruz

PHL privatization office eyes easier rules to meet target

THE FINANCE DEPARTMENT’S Privatization and Management Office (PMO) wants to revise the guidelines on the sale of Philippine government assets to help meet its “hefty” targets this year.

“What we’re trying to do right now is amend the Privatization Council (PrC) guidelines to make disposition easier,” Finance Undersecretary Catherine L. Fong told reporters on the sidelines of a forum on Tuesday. “We need to raise a lot of funds. The PrC has approved a lot of properties for disposition.”

She said PMO expects to boost its revenue through state asset sales this year, without providing exact figures.

PMO, the marketing arm of the government with respect to transferred assets, government corporations and other properties assigned to it by the Privatization Council, remitted P1.21 billion to the Treasury last year, exceeding its P500-million target, according to Finance data.

The council is a Cabinet-level body in charge of approving the government’s privatization plans.

“We have an estimated deficit from revenue collections, so I have a hefty target for this year,” Ms. Fong said.

She said the guidelines prevent them from selling assets at prices lower than the base price, which is set by two independent appraisers.

“In a lot of these properties, for example, there are many informal settlers. It makes sense to just sell these to the local government units (LGU),” she said. “But the LGUs are only willing to buy them at zonal values. Right now, we’re not allowed to do that.”

PMO is also looking into the possibility of working with real estate companies to help sell these properties, Ms. Fong said.

She also cited delays in asset sales due to procurement issues.

“There are so many assets,” she said. “Right now, we get bogged down by the appraisal. The procurement of an appraiser takes so long.”

Once the assets are appraised and they set the base price for auction, some of these turn out to be much cheaper than market prices, she added.

“Sometimes, it’s higher than actual. We don’t have flexibility. A lot of the assets that have been auctioned [had a] failed bidding, so we want to minimize that. That’s what we’re trying to solve,” Ms. Fong said.

PMO expects to finish the new privatization guidelines this month, she said.

PMO is also working with the Philippine Amusement and Gaming Corp. (PAGCOR) on its plan to privatize its gaming operations, the Finance official said.

“We’re looking to touch base again with [PAGCOR] as soon as possible to see if we can already sell those this year because we need the [funds],” she added.

Ms. Fong said the timetable for divesting PAGCOR of its assets by 2025 is still on track.

Last year, the gaming regulator announced a plan to become purely a regulator and let go of its operator role. The Finance department has been calling on PAGCOR to commit to being a regulator and “settle conflicting roles.”

PAGCOR Chairman and Chief Executive Officer Alejandro H. Tengco earlier said they expect as much as P80 billion from the sale of their gaming operations. — Luisa Maria Jacinta C. Jocson

The six biggest ways wine will change in 2024

IN Napa’s Maria Concetto winery tasting room, a robot sommelier named RobinoVino has been pouring cabernet and may eventually be programmed to recommend wines. — MARIACONCETTOWINERY.COM

AS I PEER in my crystal glass to puzzle out where the wine world is going next, I see one constant: climate change. It challenged winemakers in 2023, the hottest year in history, and will continue to do so for the foreseeable future.

Wildfires in Greece; massive heat and drought in Spain; and floods, frost, and hail elsewhere in Europe all took their toll last year, resulting in one of the smallest harvests ever. But Napa, subject to wildfires and heat waves in the recent past, escaped with one of the best vintages ever. You could argue that global warming has been good for the UK, as well as fledgling vineyard efforts in Norway and Sweden — places where, in the past, it would have been too cold and rainy to ripen grapes sufficiently. All of this makes its impact very hard to predict for the coming year.

But there’s other big news in the wine world for 2024. Here are the six major trends I’m watching:

You’ll be drinking more sauvignon blanc.

Taste preferences are shifting: More than half the wine consumed globally, as of 2021, was either white or rosé. US drinkers are leading the way with whites, according to data from the International Organization of Vine and Wine (OIV). Now, top regions known for reds, such as Italy’s Mt. Etna and the Rhône Valley, are putting more emphasis on their less well-known whites.

I see more crisp, tart sauvignon blanc from everywhere in 2024, and not just New Zealand, which has a 63% share of sales of the varietal on Boston-based online alcohol delivery platform Drizly.

Oregon is now in the game, with top names such as Andrew Rich and Patricia Green. And although Chile’s boom in the grape started two decades ago — the country is the third-largest producer of the white wine in the world, behind France (first) and New Zealand — the latest examples from ambitious wineries such as Laberinto, Tabali and Viña Leyda are better than ever.

In California, vineyard acreage of the grape has more than doubled since 2022, so expect many more superb bottlings, both inexpensive and luxury-tier, to hit the shelves.

Sparkling wine will pop even further.

The French drank less Champagne last year, because of inflation. But they still like fizz, and everyone else is in love with wine with bubbles, too. Drinks industry analyst IWSR found the number of Americans who drink sparkling wine grew 30% from 2019 to 2022. About 25% choose bubbles at least twice a week.

But it’s not all Champagne. The boom is driven partly by the popularity of prosecco and pét-nats. Spritz cocktails and hard seltzers are also inspiring non-wine drinkers to search out more bubbly.

The category will get a further boost from a few new American sparkling cuvées. Last year I tasted about two dozen new ones from California, some from unusual grapes like picpoul blanc, a lesser-known variety originating from France’s Rhône Valley. The wines are tart and lemony. (The name translates as “lip stinger.”) And in Oregon, the number of winemakers producing at least one bubbly has quadrupled since 2018.

That’s on top of delicious sparkling wines from seemingly every part of the world — many top restaurants now also carry quality bottles of Italy’s Franciacorta and Trentodoc, Spain’s cava, France’s crémants, and England’s sparklers. Sales at Kent-based Chapel Down winery, for example, rose 14% last year.

Expect more high-quality no- and low-alcohol wine, even in fancy restaurants.

Health concerns about wine was a big topic in 2023. A July Gallup poll discovered that more than 50% of Americans 18 to 34 believe even moderate drinking is bad for your health. The latest Wine Opinions survey found nearly half of the 21- to 39-year-olds polled were interested or planned to participate in Dry January or Sober October.

That’s one of the reasons this age group of consumers is drinking less wine, according to the recently released 2024 State of the US Wine Industry Report from the Silicon Valley Bank Wine division of First Citizens Bank. No wonder IWSR drinks market analysis predicted the no- and low-alcohol category will grow 15% in the US between 2023 and 2027.

Top winemakers are already on it. About 100 German wineries now produce at least one no-alcohol bottling. Prosecco maker Mionetto just launched an “alcohol-removed” sparkler. Renowned Argentine winemaker Susana Balbo is experimenting with low-alcohol cuvées: Her delicious, just-released 2022 Crios Sustentia Chardonnay contains only 9% alcohol.

We’ll ponder the question: What is wine?

We’ve seen surprising new wine regions (Sweden, Vermont), new wine styles (orange, pét-nat, piquette) and new grapes with unfamiliar names such as Goruli Mtsvane (pronounced Go-roo-lee Mah-ts-vah-nay) which is a white variety from the Republic of Georgia. Now winemakers are pushing the boundaries of what a wine is — and, in the process, finding a way to survive the extreme weather of climate change.

Many are doing co-ferments, which today often means fermenting red and white grapes together to make a lighter-style, chillable red. Others, such as Oregon’s Art + Science winery, are fermenting Grüner Veltliner with apples. The versatility means that if the grape crop is down because of frost or drought, vintners can still make something.

Others are inspired by ancestral traditions. Vermont’s Kalche Wine Co. has blended grape skins, water, and cranberries to make a piquette wine called Vib-Ur-Num.

Still others infuse grape wines with flavorings, like the white wine blend of several vintages steeped with dried botanicals from Scar of the Sea, on California’s Central Coast. Not all are labeled wine. Sometimes they’re simply called co-ferments, or, if they include apples, cider.

Rewards programs for wine will mature.

One 2024 trend on London-based importer and distributor Bibendum Wine’s annual list is that more wineries and retailers will start offering unique perks for loyal customers based on how much they spend on wine.

Some such programs already exist: Jordan winery in Sonoma has an elaborate program, with points for wine purchases that can be redeemed for discounts on overnight stays in the winery’s lavish guest suites and special tastings for free. Napa’s Lamborn Family Vineyards invites club members to an annual wine and fly-fishing event. Oregon’s Domaine Serene also owns Chateau de la Crée in Burgundy. Rack up 300,000 points in purchases and you get a stay at the chateau, with six rooms for 12 people.

AI will shape the wines you drink and how you taste it.

The buzzword of the year is AI, and it’s revolutionizing everything from the vineyard to the glass. Wineries have used artificial intelligence (AI) for years, especially when it comes to vineyard management — sensors gather real-time information on everything from light intensity to soil temperature. Robots are mowing, spraying, even ferrying pickers’ grapes to the winery.

It may soon have a big role in tasting rooms and in offering advice, too. In Napa’s Maria Concetto winery tasting room, a robot sommelier named RobinoVino has been pouring cabernet and may eventually be programmed to recommend wines. Last year, OpenAI’s US developer reported that ChatGPT-4 had passed three levels of the Master Sommelier exam — although it wasn’t the tasting part of the test, only the theory section. — Bloomberg

Local wine trends

MOSCATO GALORE: Yellow Tail from Australia and Gato Negro from Chile

(Part 1)

HAPPY Year of the Wood Dragon! Entering this new lunar year, I want to share my personal thoughts on the current wine trend in our country based on my interaction, conversation, and my own experience within the wine circle.

We just concluded a relatively tough year from a wine business standpoint in 2023, but this was understandable as the wine industry was coming off a huge boom year in 2022, bolstered by the presidential election and genuine revenge spending post-COVID. Still, the outlook and potential are quite good as from the estimated imports of 12-million-liters of wine, and with our population of 110 million, the per capita wine consumption is still just a trickle, like seven tablespoonfuls. There is so much room to grow.

Moscato Wines Are Still Very Popular
Australian-produced wines are still the most popular Moscato wines sold in the country. From Yellow Tail, Gossips, to Hardys, Australian Moscato dominates the market in two of the three shades/colors: white and pink, but not red. Based on statistics from state-owned wineaustralia.com, wine exports to Philippines decreased by 7.4% in 2023 from 2022, yet Moscato as a varietal bucked this trend when it still grew by a decent 3%. The same study showed that since 2020, exports to Philippines of Moscato grew more than tenfold.

Other Moscato-producing countries include Italy (southeastern Piedmont is the origin of this varietal and is also where Philippine’s most popular sweet sparkling wine, Asti Spumante, comes from), then there is Chile and the US.

Prior to the Australian domination of Moscato, it was no more than just an ordinary varietal, and was not mentioned in the same commercial sphere as a Cabernet Sauvignon, Merlot, Chardonnay, or even Sauvignon Blanc. This varietal was available to us locally though, thanks to the top-selling market leader, the US brand Carlo Rossi, which started selling their Red Muscat back in the early 2000s. Carlo Rossi re-labelled Red Muscat as Red Moscato (it is the same varietal) to capitalize on the “Moscato” craze.

But now Moscato — the original white version — is fast catching up to Chardonnay as the most popular white varietal in the country, while the pink counterpart has bested California-created White Zinfandel as most popular pink or rosé varietal in the Philippines. I believe this trend will continue as Filipinos just have a sweet- tooth and I don’t really see this waning in the coming years.

Trading Up With Californian Wines
American wines, primarily from California, still dominate the Philippine wine market with over one-third of total wine imports to the country. Carlo Rossi, the omnipresent Californian wine brand from the largest private winery in the world, E&J Gallo, solidly dominates the market, mainly with their generic California Red and California White variants.

In the past, Californian wines were too polarized — they were either the entry-level generic wines, which included the likes of Carlo Rossi, Almaden, Franzia, Paul Mason (rebranded as Paul Madison recently), or the premium American Viticultural Area (AVA) or appellation-labeled Napa and Sonoma wines that included illustrious names like Opus One, Robert Mondavi, Beringer, Silver Oak, Stag’s Leap, Caymus, Ferrari-Carano, Kendall Jackson, and Simi among many. The huge gap in between the cheap generic and the expensive AVA wines is where the Australian and Chilean wines thrive in the local market.

To go from the generic California wine to a basic AVA Napa wine — “basic” as in not even like a more specific Oakville Napa AVA — is easily six to eight times more expensive. But over the past few years, I have been seeing more brands competing in the mid-price segment, led by huge Californian wineries: Barefoot (also owned by E&J Gallo); Beringer, with their Main & Vine range; and old-reliable Robert Mondavi, with their Woodbridge range.

I think this has been a long time coming, as wine in the Philippines is not cheap anymore. I remembered when wine prices were below P200 some 10 to 15 years back. Now wines are definitely considered a luxury, especially compared to other alcohol beverages where locally manufactured products enjoy so much cost-advantage. From beer, gin, rum, whisky to brandy, wine cannot compete in price. Even locally produced Novellino is priced high already given that Novellino must source their wine juice from abroad too. With a weak peso, higher freight cost, and the annual excise tax increasing, even the cheapest wines are no longer cheap and are retailing at above P300 a bottle — for context, this is roughly the same price as the popular imported Alfonso Light Brandy.

This is why I think the shift is happening, especially with California wines. A California generic, non-varietal wine is at price parity with a Chilean wine that has Cabernet Sauvignon, Merlot, or another varietal in its label. Why go generic when you can have a varietal wine?! So, with American wines being the top country of choice for Filipino consumers, I finally see this natural trading up happening, and even if California varietal wines are more expensive than their Chilean counterparts, our country’s fascination with everything American-made will help it cover for the price gap.

(If you have other observations on wine trends locally, please share them with me. I would love to hear your comments.)

(To be continued)

Sherwin Lao is the first Filipino wine writer member of both the Bordeaux based Federation Internationale des Journalists et Ecrivains du Vin et des Spiritueux (FIJEV) and the UK-based Circle of Wine Writers (CWW). For comments, inquiries, wine event coverage, wine consultancy, and other wine related concerns, e-mail the author at wineprotege@gmail.com, or check his wine training website https://thewinetrainingcamp.wordpress.com/services

Manila House under renovation, renews lease for 10 years

MANILA HOUSE — MANILAHOUSEINC.COM

MANILA House renewed their 10-year lease for their space at Bonifacio Global City’s (BGC) Seven/NEO building on 5th Ave., and has also announced a renovation.

The exclusive club (Manila House chair shipping heiress Doris Magsaysay Ho didn’t quite answer the question when asked about the membership fees) houses an all-day dining lounge called Bonifacio Lounge, a chic Filipino restaurant called Anahaw, The Grill (serving A5 Wagyu), as well as the Avenue Bar; among other amenities, according to their membership kit.

“It still looks exciting and fun, right?,” said Ms. Ho during an interview with BusinessWorld on Feb. 12 at the club. “I think we saw that the club was actually really loved by the members, and we just wanted to make sure that the members feel that there was longevity in what they’re investing in.”

As for the renovation (which had already begun; Ms. Ho told us to check the deck), slated to be finished by the middle of this year, she said, “We learned a lot in the first few years. We saw what sticks; what doesn’t.” She pointed to the bar: “This bar, we really want to make it a great music space, and we need it to be bigger.”

The club was founded in 2017, with a membership fee rumored to be in the six-digit range.

Ms. Ho discussed the advantages of being a member of the club, and how the club has changed the city’s landscape. “When I come here, sometimes I just come here and I sit by myself and work, right? It’s not so easy to do that in a hotel lobby. You can feel as if it’s my home — an extension of my home. It allows you to have service while you’re at it. It’s sort of a home away from home. I think that’s one of the advantages of this place.”

As for the club’s restaurants: “We’re continuously changing. Always, always changing. What we hope, for example, for Filipino cuisine is to be a place where you can really have kind of a more elevated Filipino experience.”

She also addressed the rumors of expanding to another city: “Let’s see if we can get this done perfect,” she said, referring to the current BGC club. “Maybe. People always say maybe in Cebu, or some other place. We’re so lucky because we found this lovely spot,” she said.

“It’s got to have a unique selling proposition… Wouldn’t it be nice if we had a club in a beautiful heritage site? But we love to tear everything down.”

Apart from the food and the view, it’s the exclusivity and privacy that Manila House offers best. BusinessWorld discussed a story about a member who chose to have their coffee at the club, instead of being gawked at a cafe. “That’s true,” said Ms. Ho.

“But we want everybody to feel like we really have a lot of people from different sectors of society,” Ms. Ho said. “We tend to kind of separate from each other: the business sector, the social sector, the performing arts… we like the idea that everybody feels comfortable in this space. It’s a neutral space.

“We have to learn from each other. Sometimes we think we know everything, iyun pala hindi,” she said.

Manila House is located on the 8th Floor of Seven/NEO Building, 5th Avenue, Bonifacio Global City, Taguig City. — Joseph L. Garcia

Coordinated action needed to address P250-B water project needs — DENR

PHILIPPINE STAR/RUSSELL PALMA

THE PHILIPPINES needs coordinated efforts among stakeholders to address its water supply challenges, with an estimated investment of P250 billion needed to serve 40% of the population, an official from Department of Environment and Natural Resources (DENR) said.

“There’s still 40% of our population that does not have a formal supply of water… to provide water to the 40%, we need P250 billion,” DENR Undersecretary Carlos Primo C. David told reporters on Tuesday.

“We’ve been spending pero hindi siya nababawasan kasi hindi coordinated ’yung efforts natin (but it’s not decreasing because our efforts are not coordinated). So I think, once we coordinate it, that P250 billion, that would be easy,” he added.

The DENR announced last year that there are 135 potential water projects to be offered in 2024.

The sites being put up for public-private partnerships hold water rights via the National Irrigation Administration (NIA).

The projects are located within rivers with NIA’s structures such as dams, where water not used for irrigation can be repurposed for potable water or hydropower.

Mr. David recently announced an additional 112 water projects, which involve a combined capacity of 100 to 170 million liters per day, as part of the second batch that is up for public-private investments.

“Now, we can use water as well as the facilities that belong to NIA for various purposes, including power generation and bulk water supply,” he said.

Executive Order No. 22 created the Water Resources Management Office under the DENR to coordinate government efforts for water availability and sustainable management.

In a separate interview, Luke Foley, head of technical assistance at the Private Infrastructure Development Group (PIDG), observed a favorable market for the private sector in the Philippines.

“I think that steps being taken to date in terms of actually organizing the regulatory environment is music to the private sector’s ears, so I think what would be the challenge now is taking what’s on paper and making it reality,” he said.

Mr. Foley said that there is “a good work that has been done today on behalf of the government and also from the private sector in terms of some of the proposals that [are] being submitted.”

PIDG is an infrastructure development and finance organization that was established in 2002, seeking to accelerate sustainable infrastructure throughout South and Southeast Asia and sub-Saharan Africa.

Among PIDG’s major projects in the Philippines are a portfolio of four run-of-river mini-hydropower projects in North Luzon with a total estimated capacity of 37 megawatts.

In 2016, InfraCo Asia Development Pte. Ltd., an infrastructure and investment company managed by PIDG, entered into a joint investment and development agreement and a convertible loan agreement with Alternergy Hydro Partners Corp. (AHPC).

InfraCo Asia provided a $2 million convertible loan on a “revolving basis” to AHPC, allowing it to develop the projects to a stage where it could “successfully attract private sector investment and repay the loan” to the former by 2021.

“The overall project is about $140 million. It’s a very large project across four different sites but the idea is to use it as a platform, potentially build up beyond the four [projects]… which we helped initiate with our early funding,” Mr. Foley said. — Sheldeen Joy Talavera

Spain’s paella rice could ‘disappear,’ say farmers angry at EU rules

(MADRID — A Spanish rice variety traditionally used to make paella is under threat from a fungus after the European Union (EU) banned a pesticide farmers said they relied upon, in another example of how the bloc’s environmental rules are angering growers.

Three rice producers in the Valencia region said their harvest of arroz bomba, or bomb rice, a variety grown almost exclusively in Spain, was half the 10-year average in 2023 as a result of the Pyricularia fungus which causes rice blast disease.

Bomba rice “is very likely to disappear,” said Miguel Minguet, a rice farmer in the Albufera Natural Park in Valencia. “Our crop is going to be lost to regulations.”

Meanwhile, major exporters such as Brazil, India, and Cambodia are widely using the pesticide to protect their own crops.

Farmers across Europe have staged angry protests against the EU over restrictions they say hand an advantage to outside competitors. Spanish farmers have been protesting across the country this week.

The clashes are exposing the EU’s struggle to reconcile its sustainability drive with its aim of becoming more self-sufficient in food production amid disrupted supply chains.

The European Commission has been forced to backpedal, with President Ursula von der Leyen on Tuesday proposing the withdrawal of the EU’s plan to halve the use of pesticides.

SMALL TRACES
The EU in 2018 stopped authorizing tricyclazole because it ruled it could be harmful to human health.

It had been relied upon for 40 years to combat the fungus affecting bomba rice in Spain’s wetlands, the farmers said.

What angers farmers perhaps the most is that the EU still allows imports to have small traces of the fungicide.

“There’s one set of rules for Europe and another for those producing outside,” said Emilio Gonzalez, a professor at the School of Agricultural and Forestry Engineering at the University of Cordoba.

Imported goods need to respect residue levels set by the EU, a spokesperson for the European Green Deal team said.

The levels “ensure the products are safe for human consumption,” they said.

Farmers in the Albufera wetlands are still able to use at least two other fungicides to protect rice production, which filter into the ecosystem and affect shrimp populations, according to a 2023 study led by Andreu Rico, a researcher in biodiversity at the University of Valencia.

Rice is “an intensive monoculture where the disease spreads easily from one field to another,” Rico said.

The decline in bomba rice production has caused the price to double in three years, selling for more than five euros ($5.39) a kilo in retailers such as Carrefour or Ahorramas.

Spain’s biggest supermarket chain Mercadona confirmed shortages in recent months but supply “is gradually recovering in almost all our stores in Spain,” it said.

Bomba rice rather than other varieties is popular for cooking paella, a rice dish most typically made with rabbit, chicken, green beans, and butter beans, because it “expands like an accordion” when heated meaning it’s difficult to overcook, said Rafael Vidal, a well-known paella chef who offers classes in cooking the dish at his restaurant near Valencia. — Reuters

Israeli water treatment company eyes opportunities in PHL

UNSPLASH

ISRAEL-BASED water treatment company IDE Technologies Group is eyeing expansion opportunities in the Philippines, the company’s chief executive officer (CEO) said on Wednesday.

“We’re focusing on a specific project, but that project is kind of a very interesting opening for us because it will involve creating a local entity of IDE with mostly local people as employees,” IDE CEO Alon Tavor said during a media briefing.

“We have teamed up with several local partners to come up with very interesting projects,” he added.

IDE is a water company that specializes in the development, engineering, construction, and operation of enhanced desalination and industrial water treatment plants.

Desalination is the process of removing salt from seawater to make it potable, safe for human consumption.

Founded in 1965, it has headquarters in Israel, with offices in the USA, China, India, Chile, and Australia, facilitating client partnerships across the globe. The company has over 400 plants spanning 40 countries.

“We don’t only sell projects. A lot of the time, we own the plant, we operate it, and we simply sell water as a solution,” Mr. Tavor said.

Investing in projects typically starts at “a few hundred thousand dollars for a very small project and can go up to hundreds of millions of dollars for large projects,” he also said.

“We see the fact that the Philippines realizes the level of water issues that need to be managed as an interesting opportunity for us, and therefore we’re here.”

Israeli Ambassador Ilan Fluss said they are looking into bringing more companies to the Philippines to share their best practices and technologies.

“On the water sector, we have some Israeli companies who are active in the Philippines, but I have to say not enough and what [is] seen now is… water in the Philippines has become an important issue,” Mr. Fluss said. — Sheldeen Joy Talavera

48 Hours: Touring Addis Ababa with star chef Marcus Samuelsson

THE KITCHEN of marcus addis. — MARCUSADDIS.COM

NEW YORK — When you think of business travel, you might think of typical locations like London or New York City or Dubai.

But here is a unique idea to explore: Ethiopia’s Addis Ababa.

That is the favorite haunt of celebrity chef Marcus Samuelsson. While Mr. Samuelsson first shot to fame as executive chef of New York City staple Aquavit, today he heads up a family of restaurants that includes Red Rooster Harlem. And Mr. Samuelsson recently launched the restaurant Marcus Addis in the land of his birth.

For Reuters’ 48 Hours series, we recently spoke with Mr. Samuelsson, who showed us how to spend a couple of unforgettable days in Africa. The following interview is edited and condensed.

WHAT I LOVE MOST
Addis is such a vibrant city both day and night. You can see that the city is on a journey — you’re constantly being pulled between past, present, and future. I especially love the balance between modern and traditional in the city’s style, architecture, music, and more. You see historic marketplaces next to new skyscrapers.

There are so many young, local talents invested in the future of Addis who play off of this balance of new and old to create beautiful crafts. One of my favorite fashion designers, Mahlet Afework, has a shop called Mafi Mafi (Guinea Conakry St. & Jomo Kenyatta Ave.) where her designs are really elevating the Ethiopian fashion industry by blending traditional prints with modern style.

WHERE TO STAY
I like to stay at the Hyatt Regency (Meskel Square) because it’s clean and consistent. It’s close to everything that’s going on in Meskel Square and — of course — my restaurant.

BEST PLACE FOR TEAM MEETINGS
I always meet with the team at Marcus Addis. We’re a new restaurant and spending time in our space is so important at the beginning so we can get to know each other and our environment. I really believe the best hospitality starts internally, and that means creating a positive and warm working environment.

It’s also a great place to meet, so we can be in and out of the kitchen trying new dishes for our menu. And the amazing view doesn’t hurt — we’re on the 47th floor of the Commercial Bank of Ethiopia Headquarters tower (Ras Desta Damtew St.)!

TOURIST TRAP THAT’S ACTUALLY WORTH IT
The National Palace (Yohanis St.) is a significant cultural institution that is definitely worth the trip. My wife and I hope to bring our children with us to Ethiopia soon, and we’ll definitely take them to Unity Park on the National Palace compound, which has a great zoo.

One of my favorite spots is the Addis Skatepark (Woreda 3 Youth Center), where the Ethiopian Girl Skaters meet every Saturday morning to show off their skills. Or — if you’re looking for a scenic day trip — the Wenchi Crater Lake (Lake Wonchi), which used to be an active volcano, is another beautiful place to experience nature.

IDEAL COFFEE SPOT
Ethiopia is said to be the birthplace of coffee, so experiencing the traditional Ethiopian coffee ceremony is a cultural must in Addis. Slowing down and experiencing the whole process from roasting to grinding to ultimately drinking is so different from how we all tend to grab a cup to take on the go — just for the caffeine kick.

Tomoca Coffee (Seychelles St.), Hadero Coffee (Jacros — Salite Mehret Rd.), and Dukamo Coffee (Mafi City Center Mall, Cameroon St,) all have delicious, high-quality coffee.

FAVORITE AREA TO SHOP
Shiro Meda is one of the best markets to explore and to see the process of creating hand-woven cotton clothes for women. We often don’t get to see the craftspeople behind the clothing we wear, so I think it’s a really enlightening shopping experience.

CAN’T-MISS TREATS
Tej is Ethiopian honey wine. There’s a spot called Yod Abyssinia (Bole Medhaniyalem Area) where you can enjoy tej alongside a great local meal and traditional dancing.

Another indulgence is a spa treatment at Kuriftu Entoto Resort and Spa (Entoto Park). It has beautiful mountain views, so it’s just a relaxing experience surrounded by nature.

BEST DINNER SPLURGE
The Oriental (Meskel Square) is a delicious Thai fusion restaurant. It has a beautiful view of the square and is a great special-occasion spot. And then I like to head to the Black Rose (Africa Avenue) Lounge to keep the night going. They have a huge cocktail list, amazing music and a consistently lively atmosphere.

FAVORITE SOUVENIR
I always like to go to Merkato (Dubai Tera building, Addis Ketema district), which is the largest open-air marketplace, on my last day to get inspiration for my New York restaurant, Hav & Mar. It draws a lot of inspiration from my Ethiopian roots.

I always end up filling my suitcase, but the two staples are coffee beans and spice blends for friends, family and my own pantry back home.

BEST MEMORY
Opening our restaurant was an incredibly special experience for me and my wife. Our families came in from the surrounding villages to be with us for the opening celebration. It has been such a long time in the making. To be there with the team and the community, just taking it all in, was pretty surreal. — Reuters

New directions for human development in the Philippines

FREEPIK

HUMAN development revolves around elevating peoples’ capabilities, broadening the scope of their choices, upholding their freedom, and advocating for their human rights. This developmental concept transcends mere economic growth, placing people’s lives at its core.

In the Philippines, as in the whole Asia-Pacific region, human development has been a tale of progress, disparity, and disruption.

Today, we are faced with a convergence of escalating global tensions, deteriorating climate conditions, regional debt distress, and persisting inequality. This convergence is exerting considerable strain on development gains achieved in the past decades. This not only jeopardizes the attainment of the Sustainable Development Goals (SDGs), but also creates a potential for unprecedented setbacks in human development, economic stability, as well as climate resilience, unless prompt and extensive corrective measures are implemented.

The United Nations Development Program (UNDP) 2024 Regional Human Development Report (HDR) in the Philippines is launched at a time of great need. The 2024 Regional HDR delivers a compelling narrative: the Asia-Pacific region — known for its stellar economic performance and growth in the past decades — is home to half of the world’s multidimensionally deprived, totaling 500 million people. Across the region, approximately 800 million women are not part of the workforce, while roughly 1.3 billion people rely exclusively on informality for their livelihoods.

Aptly entitled “Making our Future – New Directions for Human Development in the Asia-Pacific,” the 2024 Regional HDR paints a qualified picture of long-term progress, but also persistent disparity and widespread disruption, foreseeing a turbulent development landscape and urgently calling for new directions to boost human development.

Over the last three decades, the Human Development Index (HDI) of the Asia-Pacific region has surged by 19 points — the greatest leap in the world. Rapid economic growth, an increase in adult literacy rates, and increased life expectancy rates have significantly contributed to major improvements in human development in the region. For the Philippines, the HDI score has increased from 0.598 in 1990 to 0.699 in 2021, growing over those three decades alongside the Asia-Pacific region’s trajectory. It declined slightly under the impact of COVID-19, keeping it within the group of countries with medium levels of human development. The Philippines ranks 7th in the ASEAN, 16th in the Asia-Pacific region, and 116th in the world.

Beyond the progress in the region, widespread disparities and persistent structural exclusion remain. Worsened by the pandemic and the rising cost of living amid global crises, persistent challenges of poverty and inequality, gender biases, and a large informal sector make it a challenge for the region to keep on track to achieve the SDGs by 2030.

To bring about the needed change, the report calls for three new directions in human development in the region: to put people at the heart of development, to recalibrate growth strategies to generate more jobs while keeping within planetary bounds, and to focus relentlessly on the politics of reform and the science of delivery to turn ideas into practice.

In the Philippines, these new directions can foster four major transformations, including: a larger and faster green economic and energy transition; strengthened resilience of families and communities from shocks and disasters; accelerated innovation and digital evolution as tools to accelerating and sustaining growth; and a more future-ready governance that can help to accelerate human development.

The Philippines can gain from decisively addressing the issues which prevent ordinary Filipinos from improving their lives through quality jobs and more secure livelihoods. As the Philippines is expecting to join the ranks of upper middle-income countries soon, a key challenge will be to tackle the lingering issues of precarity and inequality head-on. Doubling down on investments in education, health, and other human capital development needs will not only address a feeling of job insecurity among certain Filipinos, but also to further improve social mobility.

This new path also means strengthening the resilience of families and communities from shocks and disasters, which are becoming more frequent. Countries like the Philippines — which bear the brunt of climate change — face an existential crisis that can only be solved through urgent collective action at a global scale.

The Philippine government has wagered on innovation as a primary tool to accelerating and sustaining growth. However, to ensure that this growth benefits all Filipinos requires innovative approaches that are by their nature inclusive and driven by the grassroots. Innovation will need to contribute to transforming communities in “last mile” areas into effective levers of local development.

Finally, future-ready governance can help to accelerate change and human development in the Philippines. Delivering change requires making public institutions, especially at the local level, more fit for the needs, the pace of change, and the capacity to deliver prosperity to communities at risk of being left behind.

 

Dr. Selva Ramachandran is the UNDP Philippines resident representative.

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