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What are solid-fuel missiles, and why is North Korea developing them?

SEOUL – North Korea test-fired what it says was a new intermediate-range ballistic missile (IRBM) on Sunday, in what would be its first such missile powered by solid fuel designed boost capabilities for launching with little preparation.

The new missile was also equipped with a hypersonic maneuverable controlled warhead, state media said.

The launch comes after the nuclear-armed North said it had tested solid-fuel engines for an upcoming new-type IRBM in November, and conducted at least three tests last year of its new solid-fuel Hwasong-18 intercontinental ballistic missile (ICBM).

Here are some characteristics of solid-fuel technology, and how it can help the North improve its missile systems.

 

WHAT ARE SOME ADVANTAGES OF SOLID FUEL?

Solid-fuel missiles do not need to be fueled immediately ahead of launch, are often easier and safer to operate, and require less logistical support, making them harder to detect and more survivable than liquid-fuel weapons.

“These capabilities are much more responsive in a time of crisis,” said Ankit Panda, a senior fellow at the U.S.-based Carnegie Endowment for International Peace.

 

WHAT IS SOLID-FUEL TECHNOLOGY?

Solid propellants are a mixture of fuel and oxidizer. Metallic powders such as aluminum often serve as the fuel, and ammonium perchlorate, which is the salt of perchloric acid and ammonia, is the most common oxidizer.

The fuel and oxidizer are bound together by a hard rubbery material and packed into a metal casing.

When solid propellant burns, oxygen from the ammonium perchlorate combines with aluminum to generate enormous amounts of energy and temperatures of more than 5,000 degrees Fahrenheit (2,760 degrees Celsius), creating thrust and lifting the missile from the launch pad.

 

WHO HAS THAT TECHNOLOGY?

Solid fuel dates back to fireworks developed by the Chinese centuries ago, but made dramatic progress in the mid-20th century, when the US developed more powerful propellants.

North Korea uses solid fuel in a range of small, shorter-range ballistic missiles.

The Soviet Union fielded its first solid-fuel ICBM, the RT-2, in the early 1970s, followed by France’s development of its S3, also known as SSBS, a medium-range ballistic missile.

China started testing solid-fuel ICBMs in the late 1990s.

South Korea has also said it has secured “efficient and advanced” solid-propellant ballistic missile technology, though in much smaller rockets so far.

 

SOLID VS LIQUID

Liquid propellants provide greater propulsive thrust and power, but require more complex technology and extra weight.

Solid fuel is dense and burns quite quickly, generating thrust over a short time. Solid fuel can remain in storage for an extended period without degrading or breaking down – a common issue with liquid fuel.

North Korea said the development of its new solid-fuel ICBM, the Hwasong-18, would “radically promote” its nuclear counterattack capability.

After the first launch South Korea’s defense ministry sought to downplay the testing, saying the North would need “extra time and effort” to master the technology. – Reuters

Fierce fighting in Gaza as war hits 100 days

DOHA/GAZA – Israeli tanks and aircraft hit targets in southern and central Gaza on Sunday and there were fierce gun battles in some areas as the war reached 100 days since the Oct. 7 attack led by gunmen from the Islamist Hamas movement.

Communications and internet services were down for the third day running, complicating the work of emergency and ambulance crews trying to help people in areas hit by fighting.

The clashes were concentrated in the southern city of Khan Younis, where Hamas said its fighters hit an Israeli tank, as well as in Al-Bureij and Al Maghazi in central Gaza, where the military said several fighters were killed.

Hamas’ armed wing spokesman, Abu Ubaida, said on Sunday the fate of many Israeli hostages captured on Oct. 7 has become unknown.

In his first televised appearance for several weeks, marking the 100th day since the outbreak of the war, he said many of the hostages “may have been killed”, blaming their fate on Israel.

Hamas showed it retained rocketry capacity, launching a fresh salvo on Sunday at Ashdod, an Israeli town 40 km (25 miles) away. There was no word of any casualties.

Abu Ubaida said the group had been told by “several parties in the resistance fronts that they will expand their strikes on the Israeli enemy in the coming days.”

The Israeli military said it destroyed several silos used by Hamas to fire missiles at Israel.

Over the past 24 hours, the Gaza health ministry said 125 people had been killed and 265 wounded, bringing the total number confirmed to have been killed since the start of the war to almost 24,000, with more than 60,000 wounded.

Israel’s military said it has killed around 9,000 Palestinian fighters, and lost 189 soldiers, in the Gaza war so far.

Speaking through video link to a conference in Istanbul, Hamas leader Ismail Haniyeh praised the Oct. 7 attack by the group’s fighters who rampaged through Israeli communities around the Gaza Strip, killing more than 1,200 people and seizing around 240 hostages, according to Israeli tallies.

“We are not seekers of wars. We are seekers of freedom,” he said, saying the attack was, in part, a response to the blockade Israel and neighboring Egypt placed on the Gaza Strip after Hamas seized control of the territory in 2007.

The Iranian-backed group is sworn to Israel’s destruction.

 

NEW PHASE OF WAR

The Israeli military says it has shifted to a new phase of the war, focused on the southern end of the territory, where almost 2 million people are now sheltering in tents and other temporary accommodation, after the initial phase centered on clearing the northern end including Gaza City.

In the northern Gaza Strip, health officials said an Israeli air strike killed a local journalist, raising the number of journalists killed in the Israeli offensive to more than 100, according to the Gaza government media office.

In a statement on Dec. 16, in response to the death of a journalist in Gaza, the Israeli army said it “has never, and will never, deliberately target journalists”.

Prime Minister Benjamin Netanyahu has brushed off calls for a ceasefire, saying Israel will keep going until it achieves complete victory over Hamas and recovers the 132 remaining hostages.

The military says, though, the next phase of the war will see months of more targeted operations against the movement’s leaders and positions.

On Israel’s northern border with Lebanon, where there has been a constant, low-level exchange of fire between troops and fighters from the Iran-backed Hezbollah militia, the military said it killed four armed militants trying to cross the border.

It said several anti-tank missiles were fired into northern Israel, one of which hit a house in Kfar Yuval village. Medical officials said a 76-year-old woman and her son were killed. The son was in the village’s security squad, the military said.

In Rafah in the southern Gaza Strip, Nana, a 17-year-old high school student displaced from northern Gaza, said 100 days of war “turned our life upside down.”

“We demand the occupation not only to end the war but also compensation for the psychological damage of displacement and the hardships endured,” she said.

The war in Gaza has also stoked violence in the Israeli-occupied West Bank. The Palestinian health officials said Israeli forces killed five Palestinians, including boys aged 14, 16 and 17, in three separate incidents in the West Bank.

The Israeli military said two Palestinians in a car rammed through one of its checkpoints near Hebron and opened fire on pursuing troops. They were killed by return fire, the military said.

Asked about a 14-year-old boy killed near Jericho, it said soldiers had shot at Palestinians who threw explosives at them.

Palestinian health officials said two boys aged 16 and 17 were killed near Ramallah in the West Bank. The Israeli military said troops shot two Palestinians throwing a bomb at an army base. – Reuters

PHL faces blacklisting risk by FATF

PHILIPPINE STAR/MIGUEL DE GUZMAN

By Keisha B. Ta-asan, Reporter

THE PHILIPPINES’ continued inclusion in the Financial Action Task Force’s (FATF) “gray list” may result in reputational consequences, as well as increases the likelihood of inclusion in the dirty money watchdog’s blacklist, the Anti-Money Laundering Council (AMLC) said. 

This, as President Ferdinand R. Marcos, Jr. earlier directed the AMLC and all government agencies to work on exiting the gray list by October this year, after failing to meet the January deadline. 

The Philippines has been under the FATF’s gray list of countries under increased monitoring for money laundering and terrorism financing risks for two years and seven months or since June 2021.

In an e-mail interview with BusinessWorld, AMLC Executive Director Matthew M. David said the FATF only encourages its members and all jurisdictions to consider the FATF information on the listed country in their financial dealings.   

“Nevertheless, continued inclusion in the gray list may pose some reputational consequences, with some financial institutions considering Philippine-related transactions to be of higher risk,” he said.   

“Continuous inclusion in the FATF gray list also increases risk of blacklisting.”

Despite remaining in the gray list, Mr. David noted the FATF has not called for enhanced due diligence or any countermeasures against the Philippines.   

“In published statements of the FATF, it has recognized the high-level political commitment of the Philippine government in addressing its deficiencies,” he said.

“Furthermore, the FATF has recognized progress made by the Philippines in strengthening its anti-money laundering and combating the financing of terrorism regime.”

In October 2023, the FATF said the country needs to further strengthen its action plan to address strategic deficiencies related to casino junkets, nonprofit organizations, and beneficial ownership.   

Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona, Jr. earlier said that if the Philippines failed to exit the gray list this year, correspondent banks may start to cut ties with the Philippines. These are financial institutions that provide services to another bank, usually in another country.

But Mr. Remolona has said the country is unlikely to be blacklisted by the FATF.

According to Mr. David, if a country is placed on the FATF’s blacklist of countries with high risk of money laundering and terrorism financing, countermeasures may be imposed.

Financial institutions from other jurisdictions may be prohibited from establishing subsidiaries, branches, or offices in the country. These institutions will not be able to rely on third parties located in the blacklisted country as well.

Financial institutions would be required to review, amend, or terminate any correspondent relationships with banks and other financial firms in the blacklisted country, Mr. David said.   

Other countries would also increase its supervisory examination and external audit requirements for branches and subsidiaries of financial institutions.

Asked if there is a possibility that the Philippines will be blacklisted, Mr. David said the AMLC is optimistic the country will be able to address all deficiencies identified by the FATF within the year.

He said all measures needed to strengthen the country’s anti-money laundering/countering the financing of terrorism (AML/CFT) system are producing good results. 

“All agencies should continue this momentum to eventually exit the gray list. What is crucial now is the support from the private sector,” he said.   

The Paris-based FATF re-included the Philippines in the gray list in June 2021 after the country failed a mutual evaluation by the Asia Pacific Group on Money Laundering. 

The body earlier identified 18 deficiencies in the country’s measures against money laundering and terrorist and proliferation financing. The AMLC said eight are still outstanding.   

To avoid being blacklisted, a whole-of-nation approach is needed to address the eight strategic deficiencies identified by the FATF, which are clustered into five action plans, Mr. David said.

First, relevant government agencies should demonstrate effective risk-based supervision of designated nonfinancial businesses and professions (DNFBPs), he said.

“This includes the registration as covered persons by lawyers, accountants, company service providers, jewelry dealers and real estate developers and brokers with the AMLC,” he said.

“Corporations should also increasingly submit their beneficial ownership declarations to the Securities and Exchange Commission (SEC) to further enhance the country’s beneficial ownership database.”

He said all registered DNFBPs are subjected to risk profiling and compliance examinations. These nonfinancial firms should also increase the filing of transaction reports to the AMLC. 

Meanwhile, designated authorities or nonpublic bodies should use the proper AML/CFT controls to mitigate risks in casino junkets.   

“The Philippine Amusement and Gaming Corp. should ensure that casinos are able to apply fit and proper rules and conduct customer due diligence on both the junket operator and the individual junket players. The appropriate sanctions should be implemented on casinos who fail to do so,” he said.   

The Philippines should also increase its money laundering and terrorism financing investigations and prosecutions, he said.

Aside from the AMLC, relevant law enforcement agencies should file more ML/TF financing criminal cases with the Department of Justice and courts.   

Cross-border measures should also be applied to all main sea or airports of the country, Mr. David said.

“The Bureau of Customs should continue to enhance implementation of cross-border declaration measures across all international air and seaports. This should include increasing capacity for the detection of false declarations and corresponding confiscation actions should be made,” he said.   

All AML/CTF stakeholders such as supervisors, regulators, law enforcement agencies, prosecutors, other government agencies, and covered persons in the private sectors should address the deficiencies wherever applicable, he added.

In October 2023, Mr. Marcos required the urgent implementation of the government’s National Anti-Money Laundering, Counter-Terrorism Financing and Counter-Proliferation Financing Strategy 2023-2027 and ordered concerned agencies to support efforts against money laundering and terrorism financing.

Only three countries are currently in the FATF’s blacklist — North Korea, Iran and Myanmar.

In 2002, the FATF blacklisted the Philippines for having no legal anti-money laundering framework.

The Philippines was removed from the blacklist in 2003 after the passage of Republic Act (RA) No. 9160 or the Anti-Money Laundering Act of 2001 as well as its amendments through RA 9194.

Recto urged to prioritize reforms to boost tax compliance, not new taxes

President Ferdinand R. Marcos, Jr. with his new Finance Secretary Ralph G. Recto after the oath-taking at the Malacañan Palace, Friday, Jan. 12, 2024. — PHILIPPINE STAR/KRIZ JOHN ROSALES

By Luisa Maria Jacinta C. Jocson, Reporter

NEWLY APPOINTED Finance chief Ralph G. Recto must focus on tax reforms that will address issues preventing efficient tax collection and compliance, as well as consider more progressive taxes to boost revenues, analysts and business groups said.

“Reducing the burden of compliance with tax laws is a major concern for investors, and we look forward to the Department of Finance (DoF) and its attached agencies continuing to engage the private sector to resolve challenges related to this,” Ebb Hinchliffe, American Chamber of Commerce of the Philippines, Inc. executive director, said in a Viber message.

Enrico P. Villanueva, senior lecturer of economics at the University of the Philippines Los Baños said in a Facebook Messenger chat that he hopes Mr. Recto will focus on tax collection efficiency and reduction of corruption.

Mr. Recto on Friday took his oath as Finance secretary, replacing Benjamin E. Diokno, who is returning to the central bank as a Monetary Board member.

The former senator and Batangas congressman said that he will be continuing the strategies under the Philippine Development Plan and the Medium-Term Fiscal Framework. “There is a plan, there is a roadmap that essentially we will continue,” he added.

Mr. Recto also committed to reaching the tax collection targets this year. The Bureau of Internal Revenue is expected to raise P3.05 trillion and the Bureau of Customs is seen to collect P1 trillion, based on the Budget of Expenditures and Sources of Financing.

“So, every night, when I wake up in the morning, we should have collected more or less P20 billion to fund all the needs of our people and the requirements of government, and to make sure that money is spent wisely because we have to stretch every peso, including acting faster on investment,” he said.

In a statement on Friday, Mr. Recto said he will push for the immediate passage of key tax reforms endorsed by the President as priority measures in Congress.

“I agree that we need funds to finance growth and our people’s growing needs and install a system that promotes fair and fast tax administration. These measures will not only finance development but will reduce the deficit and our dependence on debt,” he said.

Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms, said that Mr. Recto must be able to push for reforms as soon as possible, ideally within the first half of Mr. Marcos’ term.

Mr. Sta Ana said that pushing for reforms later is “dangerous” as legislators will become more “sensitive to politicking and pressure from lobbying by vested interests that dangle campaign financing to politicians.”

“The incoming Finance secretary has to pursue the reforms that the DoF has endorsed, but which have been sidelined or derailed. Where Mr. Diokno failed, the new Finance secretary must succeed. Whether the new secretary will have the courage to pursue the tax reforms remains to be seen,” he said.

“It is a big challenge, given that the window to have the reforms legislated is closing amid the politicking and infighting as we get closer to the midterm election cycle,” he added.

WEALTH TAX?
Sonny A. Africa, executive director of think tank Ibon Foundation, said he hopes that Mr. Recto will be open to moderating “regressive consumption taxes that disproportionately burden the poor and ordinary Filipinos.”

“Still, even limiting new consumption taxes to single-use plastics and digital services does not go far enough,” he said, adding that Mr. Recto should also correct the “growing regressiveness” of the tax system.

Mr. Africa also urged the new Finance chief to revisit the proposed wealth tax, which would help the government significantly ramp up revenue generation.

Data from Ibon Foundation showed that a 1% tax on wealth over P1 billion, 2% tax on wealth over P2 billion, and 3% tax on wealth over P3 billion could generate around half a trillion annually.

“I hope Mr. Recto can use his stature to advocate for wealth sharing tax or a mandatory contribution to social equity based on net worth,” Mr. Villanueva added.

Mr. Diokno earlier bucked proposals of a billionaire’s tax, preferring taxes on consumption over income.

Mr. Africa said a more progressive tax system is a “no-brainer” because of the widening gap between the super-rich and the poor.

“Improving revenue generation from the narrow but extremely resource-rich tax base of profitable firms and wealthy families is also the most rational way to control deficits and moderate debt,” he added.

PwC Philippines Vice Chairman and Tax Managing Partner Maria Lourdes P. Lim said that Mr. Recto’s background in the legislature should ensure that priority measures are “not only geared to increase revenue collection but should aim to promote economic growth, investment, competitiveness and be consistent with international standards.”

“We trust that Mr. Recto will ensure that the tax measures of the government will be implemented fairly and properly (i.e. without going beyond the provisions and spirit of the law),” she said in a Viber message.

Ms. Lim noted the value-added tax (VAT) on digital services and Passive Income and Financial Intermediary Taxation Act (PIFITA) must be given priority.

“We also ask that the private sector be consulted in the crafting of the implementing rules and regulations on the recently passed Ease of Paying Taxes (EOPT) law,” Ms. Lim added.

The Department of Finance earlier said that its priority tax reform measures could generate as much as P120.5 billion this year.

These include PIFITA, VAT on digital service providers, a new mining fiscal regime, motor vehicles road user’s tax, the excise tax on single-use plastics, pre-mixed alcohol, sweetened beverages and junk food.

DROP TAX ON JUNK FOOD
Calixto V. Chikiamco, Foundation for Economic Freedom (FEF) president, said that Mr. Recto should prioritize the passage and implementation of the VAT on digital service providers, the new mining fiscal regime, and the excise tax on single-use plastics.

However, Mr. Chikiamco said Mr. Recto should also drop the proposed junk food tax, which is “controversial and debatable.”

Mr. Diokno last year proposed a tax on junk food as well as a tax increase on sweetened beverages to address health-related diseases attributed to poor diets. A bill has yet to be filed in Congress.

Meanwhile, Senate President Juan Miguel F. Zubiri said that he is looking forward to Mr. Recto’s support for the amendments to the Corporate Recovery and Tax Incentives for Enterprises (CREATE) law, which has been approved by the House committee.

“(This) would give back the power to the freeport zones and economic zones to grant the fiscal incentives rather than going to the Fiscal Incentives Review Board, which is another layer of bureaucracy,” Mr. Zubiri said in a Viber message.

“This is a priority of the President as it has gotten investors confused and frustrated and is contrary to our Ease of Doing Business regime in the country,” he added.

INFLATION
Apart from key fiscal reforms, analysts also noted other issues that Mr. Recto must address, including inflation.

“As a member of the economic team, he should prioritize tackling food inflation. This is the number one concern among Filipinos, surveys show,” Mr. Chikiamco said.

Ateneo de Manila economics professor Leonardo A. Lanzona said via Facebook Messenger chat that Mr. Recto is facing a major problem in elevated debt that is worsened by high interest rates.

“As inflation remains, these interest rates will continue to remain high. The challenge for the DoF secretary now is how to raise the funds or generate tax revenues to pay for the maturing debts,” he added.

The Philippine Stock Exchange, Inc. board of directors and management in a statement expressed confidence Mr. Recto will be able to “fast-track fiscal reforms needed to ensure the country’s economic growth, which will help boost investor confidence.”

The Makati Business Club also said that they will support Mr. Recto in “including continuous improvement of laws and policies to attract job-creating investment and expansion.”

For his part, Mr. Recto said he will be “employing measures to shield consumers, especially the vulnerable, from the impact of elevated prices, while fully realizing the promises of game-changing reform laws.”

He also said that the Maharlika Investment Fund will be managed “in fidelity with the law and fulfill its intended objectives.”

Mr. Recto also committed to support the passage of the Capital Markets Development Act, as well as “pursue reforms in public and private pensions, prioritizing the best interests of beneficiaries while ensuring actuarial health and fund sustainability.”

In a separate Viber message to reporters, Mr. Diokno also said that he will have more free time in his new capacity as a member of the Monetary Board.

“For the last eight years, I feel like I’ve run nonstop on a treadmill — from DBM to BSP at the height of the pandemic, and then DoF. Now, I’m in the cooling down phase of that long run, which I think I truly deserve,” he added.

Mr. Diokno was appointed BSP governor by then-President Rodrigo R. Duterte. He served as Mr. Duterte’s Budget secretary from 2016 to 2019 and headed the Budget department under the Estrada administration.

Mr. Marcos said Mr. Diokno was initially offered a position in the Maharlika Investment Corp. (MIC), which is tasked to oversee the country’s first sovereign wealth fund.

“Once again, I cannot thank (Mr. Diokno) enough for setting the economy on to the right path, he has guided, he has put the essentials into place, he has made the structural changes that we need. And therefore, he has… these economic figures, the results that we are getting a lot of that can certainly be attributable to the work that he did as Department of Finance secretary,” Mr. Marcos said.

Gen X, Boomers are an overlooked opportunity for digital banks expanding in the Philippines

A woman receives peso bills as part of cash assistance in Marikina City. — PHILIPPINE STARWALTER BOLLOZOS

By Aaron Michael C. Sy, Reporter

IRENE A. ZAPATA, 49, prefers to withdraw cash from the bank rather than do it through an app, and shuns e-wallet platforms.

“I prefer going to the bank because it feels safer for my money,” the housewife told BusinessWorld. “There’s also a teller whom I can easily talk to if I have any questions. Online banking seems to have too many steps and I find that hard.”

Friends and relatives and even the bank tellers have told her to get into digital banking, and she might just do that provided she gets the proper guidance, she said.

There were 9.2 million Filipinos that are part of Generation X who still don’t have a bank account, and they account for 29% of the 31.6 million digitally unbanked Filipino adults, according to the Philippine central bank’s 2021 financial inclusion survey.

A tenth of Gen Xers — people born from 1965 to 1980 — without a bank account are from the middle class (class C), while many are from Class D and E. Class AB Gen X respondents all had bank accounts.

Still, digitally unbanked Gen Xers fell to 42% in 2021 from 48% two years earlier, the survey showed.

Gen X people are the biggest consumers of financial products because they are mid-career, building wealth or preparing for retirement, the central bank said.

The Bangko Sentral ng Pilipinas (BSP) aims to have 50% of Filipinos having savings in formal financial institutions and 75% of borrowers getting their loans from formal sources by 2028. It said it has initiatives to promote financial inclusion among all sectors including Gen X.

The regulator has a consumer protection program and wants to make financial products and services more accessible.

“Perhaps the reluctance of some demographics to adopt digital transactions spans across several aspects of their lives,” Nicholas Antonio T. Mapa, senior economist at ING Bank N.V. Manila, said in a Viber message.

He said these people might prefer to hold on to cash or make physical payments because it assures them that the payment or transfer did go through.

Private banks, not just the BSP, should encourage consumers to adopt digital banking because it boosts the economy and promotes development, Mr. Mapa said.

“Financial inclusion of the unbanked sector can increase productive capital accumulation in the country,” John Paolo R. Rivera, Oikonomia Advisory & Research, Inc. president and chief economist, said in a Viber message. “Financial inclusion is about better, efficient and safe banking.”

He said regulators should ensure safety nets against cyberattacks including the use of digital platforms to steal money from banks. “If this is addressed, the unbanked will be comfortable to take part.”

BOOSTING DEPOSITS
Mr. Rivera cited the December 2021 incident where the bank accounts of more than 700 BDO Unibank, Inc. clients were hacked. “Everyone is paranoid about the safety of their money.”

Banks might find it easier to reach the underbanked sector to boost deposits and loans, Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc. said in a Viber message.

“Inclusion of the unbanked is a great challenge. The problem is access to smartphones and connectivity, so these basic issues should be dealt with and prioritized if we are to include everyone in the financial system,” he said.

Calixto V. Chikiamco, president of the Foundation for Economic Freedom, said banks should pursue Filipino baby boomers — those born from 1946 to 1964 during the mid-20th century baby boom — just as much as other generations.

“The older generations usually have more wealth than the younger ones,” Enrico P. Villanueva, an economics senior lecturer at the University of the Philippines Los Baños, said in a Twitter message.

He also said financial inclusion concerns are more about income rather than age, adding that Baby Boomers might have more issues with digital banking than Gen X.

“These empty nesters miss and crave human attention so talking to bankers physically is a joy to them,” Mr. Villanueva said. “The only challenge is going to the bank because of their health and strength. They often need companions.”

But targeting unbanked Filipinos in this age group is unlikely to boost deposits or loans, the economist said. “The digitally unbanked are likely poor with little surplus for savings, or old who do not really want digital access.”

He added that financial inclusion efforts would be more meaningful if these targeted the unbanked younger population.

The central bank had aimed to digitize 50% of the volume and value of retail transactions and to have 70% of Filipino adults become part of the formal financial system by the end of last year.

Ms. Zapata, the Gen X housewife, remains reluctant to adopt mobile banking. “They think it’s the fastest way to send and receive money, but I’m just too scared, especially with all the online scams going on.”

Impact Pioneers Network calls for more financial support for Filipino climate entrepreneurs

L-R: Priya Thachadi, CEO of Villgro Philippines; Raymond Serios, director for Strategy Projects and Administration of Negros Women for Tomorrow Foundation; Henry Sison, founder of Agro-DigitalPH; Jennifer Morante, director for Corporate and Regulatory Affairs of Magnus Renewable Tech Corp.; Abigail Tan, director for Corporate and Regulatory Affairs of ARQCapital Partners, Inc.; and, Richard Milante, head of operations of Two Tigers Holding Corp.

Impact Pioneers Network (IPN), a first-of-its-kind impact investing network, underscores the importance of making funding options more accessible to Filipino climate entrepreneurs to address urgent climate issues in the country through actionable and scalable climate solutions.

The network, together with Co-Manager Villgro Philippines, held a forum themed “Climate Action Showcase: Accelerating Enterprise Models for a Sustainable Future” at the Philippine Startup Week last year, where they emphasized the role of climate enterprises in creating local and innovative climate solutions.

“We need to empower Filipino climate entrepreneurs through accessible funding and support programs so they can lead the development of innovative and sustainable practices and products,” said Villgro Philippines CEO Priya Thachadi. “These solutions will not only respond to the pressing threats of climate change we face but will play a critical role to create a more sustainable ecosystem in the future.”

According to the Asian Development Bank, the Philippines is one of the world’s most vulnerable countries to climate change with people experiencing an increasing barrage of cyclones, floods, drought, and heat waves. The current climate crisis calls for an urgent need for the public and private sectors to accelerate solutions that are responsive to the needs of local communities.

The event featured a panel discussion among investors, innovators, and ecosystem leaders on how climate entrepreneurs can unlock funding to grow their business and contribute to climate action goals at the same time.

In the panel were Raymond Serios, director for Strategy Projects and Administration of Negros Women for Tomorrow Foundation; Abigail Tan, director for Corporate and Regulatory Affairs of ARQCapital Partners, Inc.; Henry Sison, founder of Agro-DigitalPH; Richard Milante, head of operations of Two Tigers Holding Corp.; and Jennifer Morante, director for Corporate and Regulatory Affairs of Magnus Renewable Tech Corp.

They shared that entrepreneurs should also promote good governance and financial transparency among their partners and stakeholders to acquire capital and should consistently reinvent and pivot their business models to see growth and scalable social impact.

“Filipino entrepreneurs can contribute concrete solutions to the ongoing climate crisis with quick, efficient, and accessible funding mechanisms, which we all want to initiate with them,” Ms. Tan of ARQCapital Partners said.

Villgro’s Ms. Thachadi, who moderated the panel discussion, said that it is important for climate entrepreneurs to create inclusive business models that promote knowledge and value of local communities to enhance climate resilience efforts and achieve the 2030 Agenda goals.

The event showcased emerging climate entreprises working across the Philippines, such as BillionBricks, Takiyo Japan, Dewaste Solutions, Sinaya Cup, Pammé, Cubo, Wear Forward, Re-Pamana, Suds, and SoilMate. Each demonstrated their innovative solutions in circular economy, waste management, sustainable fashion, and environment conservation.

Working Capital Facility

During the event, the network also reintroduced its Working Capital Facility that provides access to collateral-free working capital loans of P250,000 and above to early-stage impact enterprises in the Philippines. This reinforces its commitment to providing accessible funding to Filipino climate entrepreneurs to enable them to implement their plans and create solutions for the most pressing issues in the Philippines.

Enterprises who are operating in the Philippines for at least a year and demonstrating impact on the United Nations Sustainable Development Goals are eligible to apply. Their business must also be registered with the Bureau of Internal Revenue, Department of Trade and Industry, and Securities and Exchange Commission.

“Securing financing for social enterprises addressing climate problems is challenging in the country. Villgro and xchange, who are long-time collaborators and co-managers of the Network, find it easy to work together, along with our members, when mission and values align in the diverse spectrum of impact investing,” Ms. Thachadi shared.

To discover more about how Impact Pioneer Network supports social enterprises and its offers, visit www.impactpioneers.ph.

Proposal for ‘edible cutleries’ earns TIP students Swiss Innovation Prize

Elyza Marielle Camiguing (left) and Stanley del Rosario (right) of TIP Quezon City accepts a trophy for their team’s win in 2023 Swiss Innovation Prize “Sustainability” category.

Six aspiring engineers from the Technological Institute of the Philippines (TIP) Quezon City recently won third place in the 2023 Swiss Innovation Prize “Sustainability” category for pitching “edible cutleries” as a viable solution against plastic pollution.

Inspired by eco-friendly materials already being produced in other countries, the students collectively known as “Edgetec” submitted a research paper, exploring the possibility of turning flour into consumable utensils that could potentially replace flatware made of single-use plastics.

Team Leader Stanley del Rosario, a fourth-year Civil Engineering major, said they focused on trying to reduce plastic waste upon learning of its terrible impact on the environment. The pollution is linked to a number of diseases, and deaths of humans and marine biodiversity.

“With a simple product like ‘edible cutleries,’ we believe it can be a sustainable solution to lessen our need for single-use plastics,” Mr. Del Rosario explained. “It won’t cause a problem to the community, especially for marine animals because even if they ingest it, it is safe.”

Other students who worked on the project include Elyza Marielle Camiguing and Amiel Salvania (3rd Year, Electronics Engineering), Emmanuelle Dave Santos and Faron Jabez Nonan (2nd Year, Computer Engineering), and John Paul Fernandez (4th Year, Civil Engineering).

The paper titled “Edible Cutleries with Biodegradable Packaging as an Alternative to Single-Used Plastics” was part of their coursework for their Tech 101 Engineering and Entrepreneurship class under Assistant Professor James Paul Menina from the College of Business Education.

Mr. Del Rosario said one of their goals in pursuing the topic is to raise awareness on the harmful effects of plastic pollution. Citing data from Plastic Bank, the team noted that the Philippines is the leading contributor of plastics in the ocean despite not being its biggest producer.

“We don’t have the discipline to dispose and segregate our plastic products properly. The Philippines doesn’t [even] have a strong and concrete Waste Management Plan. All these things need to be addressed because it is putting our future generations in danger,” he added.

The team worked on the project for two months and submitted it for competition at the 2023 Swiss Innovation Prize last September. It was adjudged Top 3 in the “Sustainability” category by a panel of six judges out of 150 entries from students and professionals across the country.

The Embassy of Switzerland in the Philippines launched and organized the competition in partnership with the Swiss Cultural Fund and the Swiss Chamber of Commerce to support “new ideas that have the potential to drive economic growth and improve society.”

Mr. Del Rosario and Ms. Camiguing represented TIP Quezon City during the final stages of the pitching competition held last Nov. 22-24. They accepted a trophy and P30,000 cash prize during the awards ceremony held on the last day at the Makati Diamond Residences.

As finalists, both students were also rewarded with site visits to various participating Swiss companies and nonprofit organizations, as well as the official residence of the Swiss Ambassador to the Philippines Dr. Nicolas Brühl in Makati City, during the three-day activity.

ASTI’s HR Lite set to revamp government HR thru TECHNiCOM

Five government agencies participated in the demonstrations of ASTI’s HR Lite. Participants include the Philippine Statistics Authority, the Philippine Space Agency, the Anti-Red Tape Authority, and the local government units of Antipolo City and Maragondon, Cavite. — Photo courtesy of DoST-ASTI

The Advanced Science and Technology Institute (ASTI), under the Department of Science and Technology, initiated upgrades to HR Lite, an improvement from its enterprise resource planning (ERP) legacy system that offers customized solutions for unique human resource processes in various government agencies.

Spearheaded by Project Leader Paul John Serrano, the HR Lite software seeks to streamline and automate various HR processes while catering to the specific pain points of HR management in various government offices. These processes include the management of employee records, daily time logs, and personal data sheets.

The Technology Application and Promotion Institute (TAPI) approved HR Lite as one of its supported Technology Innovation for Commercialization (TECHNiCOM) projects to further support the project’s pre-commercialization efforts.

The HR Lite aims to address the limitations faced by government institutions in HR management, which commonly include the compartmentalization of tasks within siloed applications and the lack of integration when adapting to new laws and guidelines.

Unlike its predecessors, the HR Lite is designed as highly configurable software that can easily integrate new functions to meet the evolving needs of its users. Recent developments include the addition of audit logs, fields for agency-specific details, and the implementation of Role-Based Access Control (RBAC) for heightened security over confidential information.

Moreover, HR Lite aligns its use cases and form generation with Civil Service Commission (CSC) policies and guidelines, providing a seamless integration with existing regulatory frameworks.

Developed for fellow agencies

The HR Lite prides itself as a product of a government agency for the benefit of other agencies. With its cost-effectiveness and ease of use, HR Lite minimizes the need for extensive technical expertise and democratizes access to advanced HR solutions for even smaller government entities.

The creation of HR Lite was inspired by the team’s mission to address the challenges posed by traditional contract engagement in adopting ERP systems. The usual setup usually leads to termination of support and system implementation when the contract expires. HR Lite is poised as a solution to ensure workflow continuity and user accessibility.

“We want to make sure that this time, the system will be highly configurable so that many [can] benefit from it. At the same time, it will come with support from a private company so that support will be always available whenever adoptors need it,” Mr. Serrano said.

Technical demonstrations

The HR Lite team also conducted technical demonstrations among three government agencies, followed by a validation meeting with two local government units.

The customer satisfaction survey recorded a “Very Satisfactory” rating of 4.76, highlighting the system’s adaptability across diverse public sectors.

While the system’s development phase is complete, the team is preparing for end-user training and conducting a technology needs assessment before expanding the system’s deployment to a broader range of stakeholders.

Daddy Butch

PHOTO COURTESY OF WEE GAMBOA

IT’S CLOSE to midnight, and we’re talking with Ray Louis “Wee” Gamboa at the wake of his father last year at Arlington Memorial Chapel on Araneta Avenue in Quezon City. He and his older sister Tintin are still entertaining friends and family who trickle in even at this late hour to pay their respects to their recently departed parent. You can tell that Wee remains in awe of him as he fondly talks about his legacy.

Viewing the many framed photos of Ray Butch Gamboa at that chapel where separate urns lovingly hold his and his wife’s ashes, it becomes immediately evident that his was a life well lived.

Mr. Gamboa had covered and helped to grow and define the Philippine motoring beat along with the veterans we look up to. Hard to believe, but there was a time bereft of the sight of dedicated motoring sections. Motoring coverage in the dailies then was tucked into business pages.

Wee said he wished he knew how his father did it as a multi-hyphenate motoring personality in whatever medium you can think of. He and Tintin have big shoes to fill, Wee admitted — along with a Daddy Butch-sized hole in their hearts and, indeed, in the hearts of those who knew, loved, and respected the man who left his mortal coil late last year.

Daddy Butch.

I took to calling him that, too, and I asked Wee if he knew how his father felt about that moniker. “I think that’s accurate,” he shared recently. “And I know he was honored by that.”

Ray Butch Gamboa was a true pioneer. He started on his long-running Motoring Today (which also featured the late great motoring icon Pocholo Ramirez) before I even started my college education, and long before some of our newer colleagues now were even born. To be honest, I was a bit intimidated by the tall, well-dressed man when I first met him all those moons ago as a newbie in the motoring beat. You see, I had been in the lifestyle beat many years before I ventured into motoring. That intimidation was short-lived, and foolish. When he looked at (and not through) you and talked with you, there was nothing but respect. He was listening to what you said, and a politeness and kindness that’s rare these days underscored his manners.

Daddy Butch was also known as the Elvis of the beat, not just because he was always well-groomed with a head of hair that seemed ever in pristine place, but because he was a fan of the king of rock and roll.

Like Tintin, Mr. Gamboa was in radio, too. A piece penned by Epi Fabonan III revealed, “Sir Butch started in the media industry at a fresh age of 16 as a disc jockey for radio stations DZBM and DZLM of Mareco Broadcasting Corp. His career (in) radio also included DJ-ing for Uncle Bob Stuart’s musical show in DZXX… before capping it with his disc-jockeying tenure at ABS-CBN’s DZYL and DZQL stations. His early exposure and enduring career (in) radio are a testament to his passion for broadcasting and hosting.”

Daddy Butch was described as a “strict and perfectionist boss” while enabling his people’s creativity — and confidence — to flourish.

“I can consider him a perfectionist because that’s what he always told me. Do your best and not just ‘yung pwede na (what is acceptable). But I must say that his being a perfectionist has taught me to be on my toes all the time. He was a good teacher, in fact, he considered me his protégé. In some ways, I have now imbibed his way of thinking,” said Jenny Bleza-Pineda, who has risen from the ranks since starting out as a production assistant in 1988 to become “the invisible hand behind the show’s production and execution.”

I’m old enough to remember the days when everyone knew everyone in the motoring beat. It was a small community where you had to earn the respect and trust of older hands. Don’t get me wrong: Newbies were not expected to keep their head down, but they were counted upon to comport with a generally accepted code of conduct. And I guess we were spoiled in that we had no shortage of responsible and reputable elders to emulate. Daddy Butch was one of those we held in high regard.

I also have had the privilege of writing, as Daddy Butch did, for The Star, and that allowed me the luxury to consider myself to be at least in his proximate orbit. I noted with equal parts sadness and pride that his final column for the “Wheels” section, which ran on Nov. 17, came out when I coincidentally had a piece there as well. His column was about his perennially successful project, the Auto Focus Pre-Christmas Test Drive Festival. “Wheels” Editor Manny De Los Reyes admitted to understandably feeling drained and exhausted as he put that issue to bed knowing that it featured Daddy Butch’s final article.

With a hug and handshake, we bode Wee goodnight and mouthed our condolences, expressing our confidence he will continue to make his father proud. Daddy Butch is driving off to a better place, surely donning his best threads and that immaculately styled hair.

Thank you, good sir.

GCash eyes IPO by second half

ELECTRONIC wallet platform GCash is planning to conduct its initial public offering (IPO) by the second half of the year as the company awaits a more favorable market, its president said.

“We’re preparing internally so that we can be ready for this year; it is a question of the market,” Oscar A. Reyes, Jr., president and chief executive officer of G-Xchange, told reporters on the sidelines of a press briefing last week.

“From how it looks, the market doesn’t seem hopeful right now. I think we’re waiting for the market to recover. Hopefully by the second half,” he added.

G-Xchange is the operator of GCash. The parent firm of GCash, Globe Fintech Innovations, Inc., is an affiliate of listed telecommunications company Globe Telecom, Inc.

GCash is waiting for the market to improve, Mr. Reyes said.

China Bank Capital Corp. Managing Director Juan Paolo E. Colet said the second half may be the best time for an IPO this year, as the US Federal Reserve is widely expected to begin cutting rates by that time.

“This will certainly be a very exciting IPO. We expect strong appetite from local and foreign investors given the market-leading position and tech-themed growth story of GCash,” Mr. Colet said in a Viber message on Sunday.

The Philippine central bank is expected to cut benchmark interest rates by June to match the US Federal Reserve easing its policy rates.

However, a favorable market environment will not guarantee a successful IPO, according to Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce, who added that investors would assess the company’s performance and its growth strategy.

“The second half of 2024 could be a decent window for a GCash IPO, but it’s not guaranteed success. Careful evaluation of market conditions, GCash’s performance, and investor sentiment will be crucial for ensuring a smooth and successful listing,” Mr. Arce said. 

The current digital payments trend is also expected to drive investors’ appetite, he added.

“The ongoing trend towards digital payments and financial services could benefit GCash and appeal to investors looking for exposure to this growing market,” Mr. Arce said.

To date, GCash has over 80 million registered users. It has made over financial transactions for more than 60 million registered users. 

Mr. Reyes said the company is looking to expand its reach as it eyes to secure approvals in other markets. 

“Good news is we actually got approval to fully launch in 16 countries already,” he said.

GCash has launched its “beta version” allowing users in the UK, Italy, Australia, US, Canada, and Japan to use the electronic wallet platform.

“The next 10 countries were already approved as well. We’ll be going to the Middle East soon. As well as a couple of more countries in Europe and more in Asia as well, within the first quarter,” he said. 

Meanwhile, analysts said that Globe being a listed company will not impact GCash’s planned IPO, as some Globe investors will find the IPO attractive.

“The fact that Globe is already listed will not impact the GCash IPO. Some Globe investors might actually shift funds to GCash for better upside risk exposure,” Mr. Colet said. — Ashley Erika O. Jose

King of the hill

PHOTO FROM JAGUAR LAND ROVER — PHOTO FROM JAGUAR LAND ROVER

Land Rover PHL marks a milestone 700 units of the Defender sold

By Dylan Afuang

THE VIEW out the windshield was all just blue sky and blazing sun, as the vehicle met a three-foot mound of soil at an angle. Two rear wheels were planted on one side of the dirt; on the other, the front right wheel dangled above it. We gently applied throttle, and the view changed from blue to brown as the car’s front end met terra firma again. The SUV had tackled the mound.

This was the Land Rover Defender Experience, staged by Jaguar and Land Rover local distributor ICATS British Motors, Inc., that flexed to the media and the brand’s customers the go-anywhere abilities of the 75-year-old truck name that began life as a military vehicle. The event, staged late last year, also celebrated the premium SUV’s 700-unit sales in the country since its 2020 launch.

Through a makeshift off-road course composed of mud and gravel, mounds, a hill, and ruts the size of hatchbacks, the Defender 90 and 110 upheld their off-road reverence. The new Defender 110 Plug-In Hybrid Electric Vehicle (PHEV) was also displayed for prospective owners.

Stopping us from launching a P5-million to P6-million British SUV to orbit or toppling it upside down was the wealth of onboard gadgets allowing Defender drivers to do and see more when tackling perilous terrain.

That, and the hack given by the off-road driving instructors — one of whom was IC Land Automotive, Inc. Philippines Vice-President Chris Ward. “Grace, not pace,” they advised; we only needed to apply gentle application on the vehicles’ pedals and steering.

The first challenge highlighted the foundations of the Defender’s credentials — air suspension that raises the already towering ground clearance brought by clever chassis geometry, advanced four-wheel drive, and wheels pushed to the corners of the vehicle to enable superior clearance and departure angles.

Driving the Defender 110 over ruts flexed its axles’ ability to twist and articulate to degrees that few off-roaders can. It made short work of driving tilted on 25-degree side slopes made of gravel. The SUV’s traction control and air suspension coordinated to overcome any obstacle and just needed light accelerator presses to go forward.

When it was time to drive over logs as wide as the vehicle’s tires cross a patch of mud, the surround-view camera and its guide markers let the driver see what was ahead.

In contrast, three-door Defender 90’s regular coil spring setup could feel like a downgrade versus the air suspension, but its chassis allows for plenty of wheel articulation as it tiptoed across that mound.

Standard on both Defender body styles are that surround-view camera and hill-descent control system, which keeps the vehicles’ speed in check as they drive down, say, a 15-foot hill with a 50-degree slope.

Back at the air-conditioned event’s tent, where camping needs were displayed next to the Defender PHEV, we watched the SUVs take the ruts and slopes in stride. From here, it was easy to see why the 75-year-old SUV name is highly regarded for its premium allure and superior ruggedness.

DITO Telecommunity sets up to P30-B capex budget for 2024

DITO CME Holdings Corp. (DITO) said its telecommunications unit DITO Telecommunity Corp. is setting aside up to P30 billion for capital expenditures (capex) this year, mainly for network rollout, the company’s top official said.

“Our capex guidance should be anywhere between P25 billion and P30 billion,” Ernesto R. Alberto, DITO CME president and chief executive officer, told reporters last week.

The company is focusing on gaining its market share and commercial rollout, he said.

“We will be coming up with exciting new, differentiated products both on connectivity and broadband, mobile data, or fixed wireless.”

The company plans to launch products relevant to large, medium, and small enterprises, Mr. Alberto said.

“These are new commercial activities we are banking on in our desire to monetize the billions of dollars of investments we have in the past years,” he said.

Further, Mr. Alberto said that the company is still in discussions regarding its planned fundraising. 

In 2023, the company announced that it would hold another fundraising to secure financing for DITO Telecommunity’s projects. 

Last year, DITO Telecommunity had a commitment to allot P27 billion for capex to expand its coverage.

“Discussions are continuing, as you know telco business is capital intensive. The amounts that we have seen so far are not sufficient to make a formidable telco play in this country,” he said. 

MARKET SHARE
DITO Telecommunity has a commitment to cover 84% of the population this year.

“Our priority is to complete the 84%, then audit. Our aspiration is at the end of the year, 84% brand new network rollout,” he said.

Currently, the telecommunications company has about 10 million subscribers which Mr. Alberto said is about 10% of the market. 

“We are already 10 million now, with the sheer strength of our network we manage 10 million. If we have overall 100 million [registered users] after the SRA (SIM Registration Act) then we are at 10%. For us, the rightful share is 15-20%,” he added. 

The company is targeting to at least obtain 15-20% of the market by the end of the year, Mr. Alberto said. 

“Our aspiration is by the end of the year,” he said. — Ashley Erika O. Jose

 

Note: This story has been updated to specify that the mentioned capex is for DITO Telecommunity, a unit of DITO CME.

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