Term deposit yields inch down as demand slows

February 22, 2024 | 12:03 am

YIELDS on the term deposit facility of the Bangko Sentral ng Pilipinas (BSP) slipped on Wednesday, with the two-week papers going undersubscribed amid the government’s ongoing retail Treasury bond offering and as market players continue to bet on rate cuts this year.

The central bank’s term deposit facility (TDF) attracted bids amounting to P342.737 billion on Wednesday, above the P310 billion on the auction block but lower than the P353.976 billion seen a week ago for the same offer.

Broken down, tenders for the seven-day papers reached P235.287 billion, higher than the P180 billion auctioned off by the central bank and the P196.214 billion in bids the previous week.

Banks asked for yields ranging from 6.5% to 6.5835%, lower than the 6.57% to 6.6% band seen a week ago. This caused the average rate of the one-week deposits to decline by 1.17 basis points (bps) to 6.5756% from 6.5873% previously.

Meanwhile, bids for the 14-day term deposits amounted to P107.45 billion, lower than the P130-billion offering and the P157.762 billion in tenders seen on Feb. 14.

Accepted rates were from 6.58% to 6.625%, a tad wider than the 6.588% to 6.625% margin recorded a week ago. With this, the average rate for the two-week deposits inched down by 0.7 bp to 6.6041% from the 6.6756% logged in the prior auction.

“The BSP maintained the total TDF volume offering at P310 billion, with the same allocation mix of P180 billion and P130 billion for the 7-day and 14-day tenors, respectively, as in the previous week,” BSP Deputy Governor Francisco G. Dakila, Jr. said in a statement.

“The undersubscription in the 14-day TDF indicated participants’ preference for the shorter tenor in anticipation of loan releases and the settlement of the Bureau of the Treasury’s (BTr) retail Treasury bond (RTBs) issuance by end-February,” Mr. Dakila said. “Looking ahead, the BSP’s monetary operations will continue to be guided by its assessment of prevailing liquidity conditions and market developments.”

The government raised an initial P212.719 billion from its first RTB offering for 2024. This is more than nine times the P30 billion on offer.

The public offer period for the five-year retail bonds started on Feb. 13 and will run until Feb. 23, unless closed earlier by the BTr. The issue and settlement date is scheduled on Feb. 28.

The BSP has not auctioned off 28-day term deposits for three years to give way to its weekly offerings of securities with the same tenor.

The term deposits and the 28-day BSP bills are used by the central bank to mop up excess liquidity in the financial system and to better guide market rates.

TDF yields went down on Wednesday as market players continue to expect rate cuts from the BSP and the US Federal Reserve this year, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“Odds of Fed rate cuts for 2024 have been reduced recently,” he said, adding that market players see a 60% chance of the US central bank cutting borrowing costs by June or July this year, which the BSP could match.

The Fed has kept its target rate steady at 5.25%-5.5% since the second half of 2023 after it tightened by a total of 525 bps from March 2022 to July 2023.

Meanwhile, the BSP last week kept its policy rate steady at a 16-year high of 6.5% for a third straight meeting, but said it remained cautious amid lingering upside risks to inflation.

The Monetary Board has raised benchmark interest rates by 450 bps since it began its tightening cycle in May 2022. — Keisha B. Ta-asan

AI use regulations should evolve along with technology — experts

February 22, 2024 | 12:03 am

By Justine Irish D. Tabile, Reporter

REGULATIONS on artificial intelligence (AI) should be “flexible and mature” to consider the continuous evolution of the technology, according to officials of universities.

R.F. Shangraw, Jr., president of Cintana Education and a faculty member at Arizona State University (ASU), said AI technology will continue to evolve, and thus will require changing regulations.

“I think it’s important that those regulations be flexible and mature as the technology matures,” Mr. Shangraw said in a roundtable discussion on Wednesday.

He said things on the ground change fast, noting how universities previously banned the use of ChatGPT but now allow it within specific perimeters.

“[AI] is going to be evolving. Just like any other technology, it is going to evolve. And I don’t think we can get set on a fixed set of regulations that will last forever,” Mr. Shangraw said.

“I think you are going to have to constantly review those policies and a constant review by the faculty and other members,” he added.

According to Mr. Shangraw, ASU has a governing board composed of faculty and administrators that reviews policies weekly because things are rapidly changing.

“I think that policies need to be put in place now, and I think there are some frameworks that are out there… but I think the worst thing you can do is not have a framework at all,” he added.

Cintana is ASU’s global implementation partner that handles ASU’s plans to work outside the US and makes sure that the university’s programs and activities are well coordinated.

Mapúa University, ASU’s exclusive partner in the Philippines, also has a governing body working on their policy on the use of AI.

“Just recently, we finalized our academic policy on the use of AI, and in fact, we are fine-tuning it. We are also creating a policy for the whole conglomerate (iPeople, Inc.),” said Dodjie S. Maestrecampo, president and chief executive officer of Mapúa.

Mapua’s governing body is currently composed of its academic council, and the school is targeting to involve other groups such as students, administration, teachers, and personnel.

“[AI] will continually evolve, and I think that is the reason why we cannot finalize it (rules) because we are trying to actually have a final version of it. So, I think we should just have a living document that we can continuously upgrade as [AI] evolves,” he added.

Mr. Maestrecampo said the establishment of policies will help in harnessing the benefits of AI in a responsible way.

“We have to do this. We have to define policies — the dos and don’ts — for the use of AI. And I think that is the first step to make sure that this will be an innovation that is centered around principles and around the proper use of this technology,” he said.

Amid calls for AI regulation, Mr. Shangraw said the government must converse with stakeholders.

“I think out of those conversations will come a set of broad parameters around how to coexist with AI,” he said.

“It is a challenge because you don’t want too many regulations in place that stymie innovation in the field, and on the other hand, you don’t want technology to work in ways that are detrimental to the general public,” he added.

Dining In/Out (02/22/24)

February 22, 2024 | 12:02 am

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A special night at The Bar at The Pen

THE PENINSULA Manila will host Masahiko Endo, Group Beverage Director of Mizunara: The Library, Hong Kong (ranked No. 86 on Asia’s 50 Best Bars for 2023 list) — for one night only at The Bar on Feb. 23. He is an award-winning mixologist from Japan who manages the specialist whisky and cocktail bar Mizunara: The Library. With over 20 years of experience, he regularly conducts masterclasses and tasting sessions for whiskies, spirits, and cocktails. From 8 p.m. to midnight on Feb. 23, catch him at The Bar as he prepares his four signature cocktails featuring Chivas Regal. For inquires on the Mizunara: The Library, Hong Kong Pop-up at The Bar, call 8887-2888 (ext. 6694 for Restaurant Reservations and 6740 for The Bar), or visit peninsula.com/manila.

Michelin Star chefs at Solaire

SOLAIRE Resort Entertainment City is bringing Michelin Star chefs to the Philippines. For its anniversary month in March, Solaire will have three renowned Michelin Star chefs presenting their signature dishes for dinner at Solaire’s Finestra, Yakumi, and Red Lantern restaurants on March 13-16, followed by a buffet brunch on March 17. Cristina Bowerman, the Chef Patron at Glass Hostaria in Rome, a bastion of contemporary Italian cuisine which she has led for 17 years, will present a six-course dinner at Finestra featuring her signature dishes. Chef Goh Fukuyama delved into the world of French cuisine right out of high school, opening La Maison de la Nature Goh in 2002, a discreet yet stylish establishment renowned for its imaginative French Japanese omakase. He will present an eight-course dinner at Yakumi. A maestro of Sichuan cuisine, Xu Fan is the visionary behind the Michelin-starred Xujia Cuisine in Chengdu and the Black Pearl 1 Diamond restaurant. He will take charge of the Red Lantern kitchen, presenting an eight-course dinner. Joining the chefs are certified Sake Samurai and Sake Master Brewer Akihiro Igarashi, Luis de Santos, the first and only Master Sommelier of Filipino descent, and Max Solano, one of the West Coast’s most respected and creative mixologists and spirits educators. For details and more information, e-mail restaurantevents@solaireresort.com, visit https://www.solaireresort.com or Solaire’s Facebook and Instagram pages.

Starbucks’ Spring offerings

THE SPRING offerings of Starbucks are available from Feb. 20 to April 15. This starts off with the French Vanilla Mille-Feuille Oatmilk. Inspired by the classic French dessert, this has light buttery notes and flaky pastry toppings, available in hot, iced, and blended, ranging in price from P225 (Tall) to P255 (Venti). As for food pairings, there’s the Mango Coco Sans Rival Cheesecake, sans rival layered with cheesecake and mangoes, finished with mango buttercream icing and crushed roasted almonds. Prices range from P295 for a slice to P2,495 for the whole cake. The Sakura Doughnut has a pink chocolate ganache glaze with hints of cherry blossoms, priced at P95. The Black Sesame Crepe Cake consists of layers of paper-thin crepe with roasted black sesame filling and topping, sprinkled with roasted black sesame seed, and is priced at P275 for a slice, and P2,195 for the whole cake. The Plant-based Chocolate Chip Cookie is made with Belgian chocolate and is priced at P105. Other choices include the Cheesy Brioche Bun (P115), the Sausage Ragu (P235), and the Mushroom Melt sandwich (P195). Cap it all off with assorted lollipops, with different flavors ranging from caramel to grenadine (P45 each). Get them in store, along with the other spring merch like cherry blossom tumblers. Starbucks products are also available via Grabfood, Foodpanda, and Pick.A.Roo.

Shake Shack brings back Gochujang Chicken

SHAKE Shack brings back the hit Gochujang Chicken sandwich, Chicken Bites, and Fries, now available for a limited time in all Manila Shacks and at shakeshack.ph. Gochujang is a go-to ingredient in Korean cooking, made with red chili peppers, sticky rice, fermented soybeans, and salt. Inspired by Seoul’s fried chicken scene, the limited-time Gochujang Chicken (P370) features a gochujang-glazed crispy chicken breast topped with toasted sesame seeds over a white kimchi slaw. Completing the K-food experience are the Gochujang Chicken Bites (crispy, whole white meat; P255 for six; P365 for 10) and the Gochujang Fries (crispy crinkle-cut fries served with spicy-sweet gochujang mayo sauce; P275). Share a favorite K-inspired story at shakeshackph on Facebook and Instagram for a chance to win prizes. Skip the line and order ahead at shakeshack.ph.

BSP, PDIC ink information-sharing deal

February 22, 2024 | 12:02 am

THE BANGKO SENTRAL ng Pilipinas (BSP) and the Philippine Deposit Insurance Corp. (PDIC) signed a revised memorandum of agreement (MoA) on information sharing earlier this month.

BSP Governor Eli M. Remolona, Jr. and PDIC President and Chief Executive Officer Roberto B. Tan led the signing of the revised MoA on information exchange on Feb. 8 at the BSP’s head office in Manila.

“The MoA signing signifies the two agencies’ strong collaboration and shared vision for a resilient and responsive financial sector,” the central bank said in a statement on Wednesday.

Mr. Remolona said regulation and supervision have changed over the years for both the BSP and the PDIC.

“We have moved from a very prescriptive examination and supervision style to a risk-based, more principles-based supervision. We do not tell banks specifically what to do. We tell banks to take risks seriously, and that is the reason for all these regulatory standards,” he said.

He also noted the crucial role of deposit insurance in managing runs, which is considered the biggest risk for banks.

“I enjoin everyone, as stewards of this Revised MoA, to follow through on your commitments to keep the Revised MoA updated, relevant, and operational in pursuit of our primary objective of promoting financial system stability,” he added.

According to the BSP, the revised MoA updated the agreement dated Nov. 12, 2002 and the supplemental MoA signed in 2004.

The agreement covers information, data, and reports shared between the central bank and the PDIC.

It also includes continuous information sharing through digital platforms and rationalized processes, the use of the BSP Electronic Information System between the two agencies, and the periodic review of the MoA to consider evolving supervisory requirements.

The prudential reporting requirements of banks will also be streamlined, as banks are no longer required to submit some reports separately to the PDIC, the BSP said.

“Transparent communication between us provides opportunities for a comprehensive understanding of potential risks, enabling us to draw up preemptive measures, detect challenges early, and promptly intervene to immediately address problems among banks to make it responsive to the changing times,” Mr. Tan said.

“The collaboration between our institutions becomes even more paramount and imperative to protect the depositing public, especially from frauds and scams that have become even more elaborate and complex,” he added.

The BSP and PDIC jointly conduct examinations of banks to ensure the stability of the financial system.

The PDIC also issues rules and regulations to help protect the deposit insurance system and the depositing public. – Keisha B. Ta-asan

The nuclear trade mission to Canada

February 22, 2024 | 12:02 am

The Canadian embassy in the Philippines has organized a Philippines Nuclear Trade Mission to Canada in early March this year. Officials from the Department of Energy, Energy Regulatory Commission, private energy companies, and some media people were invited.

Canada is a good place to learn more about nuclear power technology and economics. As of 2022, it had 19 operable nuclear power reactors with a capacity of 13,624 megawatts (MW). In comparison, the US had 93 operable reactors with a capacity of 95,835 MW, France had 56 reactors with 61,370 MW, China had 55 reactors with 53,286 MW, Japan had 33 reactors with 31,579 MW, Russia had 36 reactors with 26,802 MW, South Korea had 26 reactors with 25,829 MW, and India had 22 reactors with 6,795 MW.

Canada also plans to build 11 new reactors with a capacity of 6,100 MW. But China plans 42 new reactors with 46,110 MW, Russia plans 25 reactors with 23,525 MW, and India plans to build 12 reactors with a capacity of 8,400 MW. See this column’s piece last week, “The nuclear option for Asian industrialization” (Feb. 15).

The bulk of power generation in Canada comes from hydro, which made up 60% of the total in 2022, while nuclear contributed 13%. The most nuclear-intensive country in the world is still France with 63% of its total electricity production coming from nuclear plants. The big Asian countries remain coal-intensive in their power generation, including India, China, Indonesia, and the Philippines with at least 60% of their power generation coming from coal. South Korea is the most nuclear-intensive Asian country with 28% of its power generated from nuclear energy (see Table 1).

If the Bataan Nuclear Power Plant (BNPP) had been allowed to operate from 1985 until today, it could have generated at least 4,600 megawatt-hours or 4.6 terawatt-hours (TWH) yearly assuming a low-capacity factor of 85%, up to 5+ TWH at a higher capacity factor.

Among the activities that are planned for the nuclear trade mission to Canada by the Philippine delegation is a visit to McMaster University – University Network of Excellence in Nuclear Engineering (UNENE). It houses world class nuclear research facilities anchored by the McMaster Nuclear Reactor — a multi-purpose research reactor that provides neutrons for medical isotope production and scientific research. Their nuclear research facilities enable discoveries in medicine, nuclear safety, and materials and environmental science, while providing cancer treatments for more than 70,000 patients every year.

The delegation will also attend the NextGen2NetZero Nuclear Technology Forum, organized by the Organization of Canadian Nuclear Industries, at Ajax Convention Centre. They will also be meeting with Bruce Power at its Toronto Headquarters. The biggest nuclear plant in Canada and the world, it has eight reactors with combined capacity of 6,358 MW. In 2020 it generated 43.23 TWH.

The delegation will be making a site visit to the Darlington Nuclear Generating Station and meeting with Ontario Power Generation (OPG). Darlington station is Canada’s second largest nuclear facility with a capacity of 3,512 MW. It generates up to 31 million MWh (or 31 TWH) yearly. Its four CANDU pressurized heavy water reactors (PHWR), 878 MW each, are owned and operated by OPG.

There will be meetings with other groups: the Nuclear Waste Management Organization, OntarioTech University, New Brunswick Nuclear, ARC Clean Technology Canada, Inc. which develops Small Modular Reactors (SMRs), and with the University of New Brunswick – Centre for Nuclear Energy Research (CNER).

The combined electricity production of Bruce Power and Darlington Station was 74.2 TWH (43.2+31.0). In 2020, the total amount of power generated in the Philippines was 101.76 TWH, and in Luzon grid, 72.42 TWH. So, if the Philippines had only one-half of the capacities of Bruce and Darlington, almost one-third of the whole country would have cheap, stable electricity with no blackouts — except when the problems are on the transmission and distribution sides.

Among the questions that people ask about nuclear power generation — aside from the safety issue — is the price. How cheap or expensive will nuclear power be compared to other sources? Well, it is cheap, the reason being that nuclear has very high energy density — one pellet of 20 grams can produce the same amount of electricity as 410 liters of oil, or 400 kgs of coal (see Table 2).

More than half of the cost of nuclear power is due to construction of the facility due to redundancy of safety features, but once it is built, it has very low fuel cost and low maintenance because a nuclear plant has a lifetime of 60+ years. SMRs is bringing down the cost.

The Philippines would be interested in SMRs, especially for off-grid islands and provinces that are currently dependent on big gensets running on oil, a fossil fuel. Canada is now commercializing SMRs, up to 300-MW plants. Federal agencies like the Canada Infrastructure Bank, and Canada Strategic Innovation Fund (SIF) are investing to accelerate the development of SMRs, Integral Molten Salt Reactors (IMSR), and Micro Modular Reactors (MMRs).

The Maharlika Investment Fund (MIF) should consider funding some SMR projects in some parts of the country. If they bring down the cost of electricity in the provinces, reduce or abolish the threat of blackouts, then we can attract big commercial and manufacturing plants.

While Canada has offered and hosted this trade mission, perhaps other nuclear-generating Asian countries like Japan, South Korea, and China can make similar programs and invite Philippines energy agencies and power companies to see what they have got.

The Philippines has had an average increase in power generation of 5-6 TWH yearly until 2022. By 2023 it should have increased to 6-7 TWH. From 2024 to 2030, we should target an increase of 8-9 TWH yearly to sustain a GDP growth of 6-7% yearly.

More energy supply, more electricity generation from more sources, agnosticism in energy source, coupled with an improvement in transmission and distribution of electricity — we need these to propel the country towards more industrialization, and more growth and prosperity.

Bienvenido S. Oplas, Jr. is the president of Bienvenido S. Oplas, Jr. Research Consultancy Services, and Minimal Government Thinkers. He is an international fellow of the Tholos Foundation.

minimalgovernment@gmail.com

Aboitiz InfraCapital eyes expansion of LIMA Estate business hub

February 22, 2024 | 12:02 am

ABOITIZ InfraCapital, Inc. is planning to expand the business hub of its LIMA Estate by 40 hectares within the first half, the infrastructure arm of the Aboitiz group said on Wednesday.

“Our vision for LIMA is to create a dynamic, innovative, and socially responsible urban center that resonates with the lifestyles of Batangueños and those seeking an appealing alternative outside Metro Manila,” Rafael P. Fernandez de Mesa, head of Aboitiz InfraCapital Economic Estates, said in a statement.

Located in Lipa and Malvar, Batangas, Aboitiz InfraCapital’s LIMA Estate is an 800-hectare economic zone, serving as an industrial and economic estate in Cavite, Laguna, Batangas, Rizal, and Quezon (Calabarzon).

LIMA’s Estate’s business district is a 30-hectare hub. Its planned expansion is targeted within the first half of the year which will include commercial, retail, mixed-use and residential space, Aboitiz InfraCapital said.

“The upcoming launch of LIMA Tower One, the first of seven towers in LIMA’s Office Park, is a significant step in supporting the needs of growing companies, especially in IT and business services,” the company said.

The tower is set to open within the year. It will offer seven stories of office spaces, it said.

“At LIMA Estate, we prioritize innovation, community engagement, and sustainability. By embracing a more holistic approach, we are paving the way for the future of central business districts not only in the Philippines but also around the globe,” Mr. Fernandez said. — Ashley Erika O. Jose

Philippines falls to 35^th rank in Global Economic Diversification Index

February 22, 2024 | 12:02 am

The Philippines dropped two places to 35th place out of 112 countries with an average score of 104.96 in the 2024 edition of the Global Economic Diversification Index by Mohammed bin Rashid School of Government.

Lockbit hackers’ swagger on display after police leak identities online

February 22, 2024 | 12:02 am

WASHINGTON/LONDON — One of the world’s biggest criminal hacking gangs woke up on Tuesday to a startling discovery: Law enforcement, after taking over their main website on Monday, were now threatening to reveal their personal details and data about their cybercrime organization.

The group, Lockbit, had become notorious in cybercrime circles for using malicious software called ransomware to digitally extort victims, relying on underground marketing campaigns to boost its profile. At one point, LockBit had promised $1,000 to anyone who tattooed their logo on themselves, according to cybersecurity researchers.

The group’s ringleader, known by the online moniker “LockbitSupp,” had also become so confident in their own anonymity that, according to Britain’s National Crime Agency (NCA), they had promised $10 million to the first person who could find and unmask them.

The international law enforcement operation, which had posted on the extortion website on Monday that it had taken control, on Tuesday announced it had re-engineered LockBit’s core online system — mimicking the countdown clock that LockBit used in extortion attempts and posing its own $10 million challenge, according to a review of LockBit’s darkweb site.

The core online system was reengineered to target the hackers in the same way they had terrorized victims: with an advent calendar-like series of tiles, each marked with a countdown timer that, upon reaching zero, published stolen data.

Across the website’s front page, where victim names once stood, law enforcement agencies replaced the text and links with internal data obtained by hacking the hackers themselves.

The resulting display was a smorgasbord of law enforcement action against LockBit which included indictments, sanctions, a tool with which victims can decrypt their data, and a new countdown with two days left on the clock which asked: “Who is LockbitSupp? The $10 million question.”

Before it was taken down, LockBit’s website had displayed an ever-growing gallery of victim organizations that was updated nearly daily. Next to the names were digital clocks showing the number of days left to the deadline given to each organization to provide ransom payment.

The unique law enforcement operation was the result of a years-long investigation by international police agencies and was designed to undermine the group’s credibility in the criminal underground, officials said.

“LockBit’s affiliates should be very concerned right now, especially as law enforcement continues to make decryptors available to victims,” said Charles Carmakal, Mandiant Consulting’s chief technology officer.

The United States has charged two Russian nationals with deploying LockBit ransomware against companies and groups around the world. Police in Poland and Ukraine made two arrests.

Before it was seized by police, LockBit was able to extort multiple hacking victims at the same time through its website, which listed breached companies next to the countdown timer.

Once the counter expired, the cybercriminals would often publish caches of stolen data from the victimized company — historically, these exposures included personal private information of customers, medical records, internal billing data, and the communications of internal staff, among other things.

These leaks were intended to harm the reputation of victims and put them in legal jeopardy, experts told Reuters, netting Lockbit over $120 million in ransom payments.

On Tuesday, Graeme Biggar, director general of the NCA, told journalists that the true cost, including money spent by organizations and corporations scrambling to regain access to their networks and the impact on business, could have amounted to losses totalling billions. — Reuters

Atome partners with Mastercard for game credits offer

February 22, 2024 | 12:01 am

ATOME Philippines has partnered with Mastercard to allow its cardholders to convert their rewards points into gaming credits via the Mastercard Gamer Xchange (MGX) platform.

“We’ve seen a very strong take-up for the Atome Card, especially among digital-native Gen Z and millennial users in the Philippines, with one of the top use cases for the Atome Card being online purchases. We see a strong synergy in this partnership with Mastercard’s MGX platform as it provides Atome Card holders and gamers access to a wide range of gaming credit options,” Atome Cards Business Head Magic Tang said in a statement on Tuesday.

As part of the offer, gamers in the Philippines can convert their Atome Card rewards points into gaming credits across nearly 4,000 game titles via turnkey solution MGX.

Atome cardholders can obtain up to P2,000 worth of gaming credits when they shop using the recently upgraded Atome Card. The offer is available until March.

“MGX bridges the world of rewards to the thriving global gaming community, offering an innovative and seamless redemption solution in a new category. From eSports viewers to console and smartphone gaming enthusiasts across a range of demographics, it opens new connections to the world’s fastest expanding entertainment market,” Mastercard Consumer Marketing & Sponsorships Senior Vice-President Kaveri Khullar said.

“As the Philippines gaming market anticipates further growth in the next few years, this partnership with Atome is a fantastic example of how innovative payment experiences are evolving to connect consumers to their passions,” she added.

The new Atome Card allows users to shop using buy now, pay later anywhere a Mastercard card is accepted. Cardholders may pay in three or six months.

The Digital 2024 report of consumer intelligence firm Meltwater and creative agency We Are Social showed the Philippines placed second (95.9%) to Indonesia (96.5%) when it comes to video game consumption on any device. — AMCS

A mixed bag: great meat and cocktails make up for low notes

February 22, 2024 | 12:01 am

UMA NOTA MANILA displays multicultural glamor and lots of visual appeal, occupying a very interesting space at the lower ground floor of Shangri-La at the Fort (the entrance is at street level; we had to go downstairs, very exciting).

Still, we found the appetizers mushy. When we sat down to dinner and drinks during a tasting on Feb. 16, the Coxinhas de Frango (chicken and okra croquettes with chili sauce) and the Dadinhos de Tapioca (Brazilian tapioca and cheese dice with sweet chili sauce) left us feeling a bit old as we chewed and chewed, unfortunate in the surrounding South American mid-century glamor-infused interiors designed by Asmaa Said, founder of The Odd Duck Studio in Dubai.

Never mind, we had other courses to consume: we really liked the Tataki de Carne de Sol, lightly cured beef tenderloin with smoked ponzu sauce, black garlic mayonnaise, and crispy shallots. That was a lovely balancing act between lacy, delicate textures and bold flavors. That’s not something we could say for the forgettable asparagus and avocado roll, nor for the Salmon Roll with cucumber, wasabi cream cheese, avocado, sweet soy, and salmon roe (which if we’re being perfectly honest, tasted like it came from the American Midwest).

Beef, however, is definitely a draw here, and we look back with delight at the A4 Kumo-Oh Japanese Wagyu Striploin. Perfectly tender and perfectly juicy, all 180 grams of it was consumed with a smile (especially when we realized that it cost P8,500, according to the menu outside).

The dessert with roasted pineapple and coconut ice cream made us think how well the roasted pineapple would have matched with a savory dish.

In keeping with the visual spectacle that comes with the real estate, the Matcha Layer Cake with Hokkaido Milk ice cream was stunning, veiled as it was in a thick cloud of cotton candy, which the server torches away. We stared long and hard at the tiny cake, thinking about the size of the cloud that had earlier enveloped it. We think about the origins of the word “glamor,” which we use profusely in this article: it had originated as the word for a witch’s disguise of beauty, until it had become associated with the spurious beauty itself.

As for the cocktails: well, that’s definitely a bright spot. We had the Red Flag, with Arette tequila, Mancino Rosso Amaranto, Mezcal Durango, and raspberry chili syrup; the glass rimmed in spicy togarashi. This drink tasted devilishly delicious, and if you drink too much of it, you’ll probably turn into a red flag yourself.

Uma Nota Manila is the third in the chain, with its two other locations in Paris and Hong Kong (we told you it was glamorous). Co-founder Alexis Offe, who had grown up in Hong Kong, told us that he started the concept in 2017 after a trip to Brazil (which their executive chef Gustavo Vargas calls home). Uma Nota is supposed to serve Japanese-Brazilian cuisine, a cuisine born from the huge Japanese migrant population there.

There are a lot of chance encounters in this story: their Managing Partner in the Philippines, Michael Needham, said that he came across the restaurant after dining at a highly recommended Mediterranean place also owned by Mr. Offe, only for Mr. Offe’s father, a former chef who happened to be in his son’s restaurant, told him to check out his son’s other place. As a multicultural individual himself (of mixed parentage and a life spread across four countries), the concept appealed to Mr. Needham: “I was always fascinated, and I just loved this idea that it’s not fusion… it’s subculture cuisine.”

As for opening in the Philippines, Mr. Offe said, “The more time passed, the more I wanted to approach emerging cities and markets, more than the bigger cities. There are a lot more opportunities, it’s a very exciting city in a very exciting region.

“There’s a big interest in Japanese cuisine; there’s a big interest and similarity in terms of what Filipinos love to eat, and what Brazilians like to eat.”

Uma Nota Manila is in Shangri-La at the Fort in Bonifacio Global City, and is open from Sunday to Tuesday at 6 p.m. to midnight for dinner, while the bar hops from 6 p.m. to 2 a.m. from Sunday to Tuesday, and from 6 p.m. to 4 a.m. on Wednesday to Saturday. — Joseph L. Garcia

Corporate culture

February 22, 2024 | 12:01 am

CULTURE often applies to countries. It defines a set of shared values, norms, and beliefs for a particular society. Sociologists refer to culture as the way a tribe “lives its life.” Thus are Filipinos known for their hospitality culture (they give up the best room in the house for a guest) that sets them apart as outstanding caregivers and service workers.

Corporate culture is also a shared set of values and beliefs limited to an organization, especially as it deals with outside parties like customers and competitors.

Are there common traits and beliefs that distinguish one set of corporate employees from other groups? The belief and value systems are not always written down and, even when they are, they are filed away along with the mission statement and the company motto — “Our most valuable asset is our people.”

It is practice and behavior that more accurately define corporate culture. And unfortunately, it is improper behavior that distinguishes one organization from another. The behavior and conduct of individuals in an organization, condoned by its leadership, determine the prevailing corporate culture.

The customer is not always right. He can be a pest with his complaints about the service. Are such complaints attended to with a sense of urgency? (Please stay on the line until you are rescued by ennui.) Complaints are dysfunctional and they eventually sort themselves out in a year or two. Let the other company get the pest.

Getting ahead is based on political maneuvering. Pleasing the boss, and those who please him, is important in order to be noticed. So, try and see who is important to the boss and get his slippers when he needs them. Never mind meeting targets and addressing service reliability.

What about teamwork? It’s not important what gets accomplished when employees are focused on the task. The key to every success is who gets the credit. It is best to be the first to report a win, without alluding to the one responsible for it. The other side of this pursuit for credit is finding the scapegoat to blame in case of a fiasco.

How does the company handle the emergency needs of employees? When an employee or her mother gets sick and requires expensive medical treatment, is the item just posted in the digital hub with prayers and donations solicited? (Please pass the hat.)

Corporate culture is defined by actual behavior, not by a written document. It follows child-rearing practices of what deeds and attitudes are rewarded or punished. The compensation system (especially variable pay and merit increases) has a big impact on defining corporate culture. The value system is enhanced or compromised by the carrot and the stick, and how these are dispensed.

Corporate culture is associated with the incumbent CEO whose attitudes and behavior define what is acceptable or not. His own conduct serves as a model for the rest. (Is he a bully or a nurturer?)

So, a new CEO or even one appointed in transition (until a new CEO is found) must find out what the set of beliefs and values currently are, and whether to preserve or overhaul them.

A survey is one way to capture the opinions of different stakeholders in the organization to be converted to charts and statistics. Do the lower levels feel they can influence decisions at the top? The survey provides what consultants call a “base line,” or the present situation, preferably dire and in need of intervention. This is like a medical diagnosis of a very sick patient. Why else does one need a cure, or a doctor for that matter? The survey is the starting point for any transformation. (This is always the prescription.)

The process of defining the corporate culture does not mean abandoning other critical activities like selling products, attending to customers, reducing headcount, and taking care of the bottom line. These are ongoing, even with the many meetings that the definition of the corporate culture will entail. Is the process of transformation disruptive? Do earthquakes cause buildings to shake?

In the end, “modeling” is what defines corporate culture. The behavior of the CEO (or the actual leader, if the CEO is merely titular) determines the values of his direct reports and those who report to them. Corporate culture starts at the top… and ends at the bottom.

Tony Samson is chairman and CEO of TOUCH xda

ar.samson@yahoo.com

KMC Savills sees resilient office demand in PHL

February 22, 2024 | 12:01 am

Office-buildings — CHRIS ANDERSON-UNSPLASH

REAL ESTATE brokerage and consultancy firm KMC Savills on Tuesday expressed “cautious” optimism about the Philippines’ property sector this year.

“We’re cautiously optimistic. I think there’s no point in getting too far ahead of ourselves or too overly bullish or overly optimistic,” said KMC Savills Chief Executive Officer Joe Curran during a media briefing.

Among sectors, KMC said it is optimistic for office, retail, and tourism and hospitality, but uncertain about residential as well as industrial and logistics.

Mr. Curran said that office demand is expected to sustain while an increase in vacancy rates is anticipated due to multiple office building completions in 2024.

He added that Bonifacio Global City (BGC) in Taguig City is still the “favorable location” for prime buildings, which boasts over two million square meters (sq.m.) of office space.

“We do see some new supply coming online in 2024 and 2025 that should have an impact on rates and vacancy. There’s about another 180,000 sq.m. of completions in BGC,” Mr. Curran said.

Some of the expected completions include Uptown Eastgate (105,000 sq.m.), International Finance Center (63,000 sq.m.), MJ Fort Tower (8,000 sq.m.), and Sennett Corporate Center (5,000 sq.m.).

In 2023, BGC’s office vacancy rate hit 14.3%, higher than the Makati central business district (CBD) at 10.9%. However, other areas logged higher office vacancy rates such as Bay Area (32.6%), Ortigas Center (25.7%), and Alabang CBD (35.5%).

Mr. Curran said the average post-pandemic Metro Manila office lease rates have declined 6.7% to P858 pesos per sq.m.

KMC data showed that the average office rate in BGC is P1,054 per sq.m., higher than Makati CBD (P1,021.2/sq.m.), Bay Area (P737.9/sq.m.), Ortigas Center (P695.8/sq.m.), and Alabang CBD (P603.3/sq.m.).

“Post pandemic, we’re still in a period of price discovery in terms of where our rental rates are going to fall for the next three to five years. BGC still has the highest headline rates across the metro,” Mr. Curran said.

“Higher vacancy rates and potentially with 180,000 sq.m. of new supply coming online over the next two years, you might actually see some downward pressure on rents in BGC and Makati might move back into top spot in terms of being to command the highest rents across the metro,” Mr. Curran said.

For the industrial sector, KMC Savills Chief Operating Officer Cha Carbonell said that elevated vacancies will put pressure on warehouse rent rates.

KMC data showed that rental rates in Bulacan and Pampanga fell by 42% and 21%, respectively.

“Empty warehouses stand as stark reminders of the economic slowdown, pushing industrial rental rates down. Particularly noteworthy are the significant decreases in Bulacan (42%) and Pampanga (21%),” she said.

“Manufacturing companies lead the demand for industrial warehouse space at 41%, followed by third-party logistics and fast-moving consumer goods,” she added.

In the residential sector, KMC Savills Associate Director for Research Joshua De las Alas said that property developers are now focusing on high-end and luxury developments.

KMC data said the Metro Manila market has only sold 65% of the 113,000 units floated, both for pre-selling and ready-for-occupancy units, with 40,000 units still left unsold, half of which are from mid-market developments.

He added that sales of mid-market condominiums have declined as a result of rising interest rates as well as lesser need for employees to live near their workplaces.

“A dip in the take-up rate for low-middle segments serves as evidence of a shifting market, reflecting a general lack of appetite and decrease in purchasing power. Furthermore, the significant number of withdrawals from the mid-end segments contributed to the slow take-up rate,” Mr. De las Alas said.

In the retail sector, KMC said it is optimistic since occupancy rates and foot traffic are slowly getting back to pre-pandemic levels amid the normalization of business operations across the country.

It added that the tourism and hospitality sector has a bright outlook as international tourist arrivals increased by 105% to 5.45 million international visitors in 2023. — Revin Mikhael D. Ochave