PHL touted as among largest potential e-commerce markets

October 3, 2024 | 9:18 pm

THE PHILIPPINES could be one of the biggest markets for e-commerce due to its demographic makeup, an online shopping platform said.

On the sidelines of the 10.10 Brand Summit, Shopee Philippines Head of Public Relations Erin M. Tagudin told reporters of the Philippines’ growth potential.

“We do think that there is a great opportunity for e-commerce now, especially now that the government is looking at it,” she said.

“We are very happy that the industry is booming, and we do feel that the Philippines is going to be one of the biggest markets,” she added.

She said that the optimism stems from the growing number of Filipinos shopping online.

“I can say that in terms of population, the Philippines is big in shopping. But of course, Indonesia is still number one in terms of population,” she added.

Citing a UK study, Ms. Tagudin said that the Philippine e-commerce market is expected to grow 19.6% this year to P1.3 trillion.

It is also expected to post a compound annual growth rate of 13.2% between 2024 and 2028.

“This surge can be attributed to the increasing preference for online shopping and more robust interest penetration bolstered by the growing middle class,” she said.

She said the 15% increase in the annual household income of Filipinos in 2023, as reported by the Philippine Statistics Authority signaled an opportunity for brands to capture a slice of the increasingly affluent market.

“This aligns with the trend we’ve observed among our users who spend more on categories that (suit) their lifestyle when shopping for branded items in Shopee Mall,” she said.

She said that the top four product segments in the Philippines are lifestyle, fashion, electronics, and beauty.

“This presents an opportunity for brands, especially in these categories, to attract these increasingly economically empowered consumers and ultimately expand their market,” she added. — Justine Irish D. Tabile

VAT on digital services law levels playing field for MSMEs, DTI says

October 3, 2024 | 9:18 pm

MSMEs-traid fair — PHILIPPINE INFORMATION AGENCY

THE Department of Trade and Industry (DTI) said newly signed legislation that will impose value-added tax (VAT) on foreign digital service providers will help level the playing field for micro, small and medium enterprises (MSMEs).

In a statement on Thursday, Acting Trade Secretary Cristina Aldeguer-Roque said the VAT on Digital Services Law will also empower MSMEs in the digital age while protecting consumers.

“This landmark legislation is a significant step towards creating a more equitable and inclusive digital economy in the Philippines,” Ms. Roque said.

“By ensuring that all digital service providers, regardless of origin, contribute their fair share to the country’s tax system, we are promoting healthy competition and supporting the growth of our MSMEs,” she added.

President Ferdinand R. Marcos, Jr. on Wednesday signed into law Republic Act No. 12023, which amends the National Revenue Code of 1997 and imposes a 12% VAT on foreign digital service providers.

Apart from the 12% VAT, the law also imposes a 5% VAT on registered foreign entities providing services to the government.

Under the law, nonresident digital service providers are required to register for VAT if their gross sales or receipts for the past year exceed P3 million.

The law covers online search engines, online marketplaces, cloud services, online media and advertising, online platforms, and digital content providers.

“This removes the unfair advantage previously enjoyed by foreign digital service providers,” Ms. Roque said.

Separately, Philippine Retailers Association President Roberto S. Claudio said the industry welcomes the law.

“On behalf of the business community and retailers in the Philippines, this now levels the business environment between local retailers and online foreign merchants,” he said via Viber.

“This will also substantially boost tax revenue for the government’s social and educational programs,” he added. — Justine Irish D. Tabile

BIR: ‘No guarantee’ of steady prices under digital VAT law

October 3, 2024 | 9:18 pm

THERE is “no guarantee” that foreign digital service providers will continue with their current pricing schemes now that they are being charged value-added tax (VAT), the Bureau of Internal Revenue (BIR) said on Thursday.

“Pwedeng hindi naman tumaas din ang presyo nila (foreign digital service providers). Pero of course, hindi natin ma-ga-guarantee na hindi tataas ang presyo,” (It is possible prices won’t rise, but there is no guarantee,” BIR Commissioner Romeo D. Lumagui, Jr. said in a television appearance.

In a statement issued separately, the BIR said Republic Act (RA) No. 12023 “is not a new tax” but “ensures that the VAT being paid by local digital businesses, will also be paid by foreign digital businesses.”

The law aims to “promote fair competition amongst businesses that are profiting from consumers here in the Philippines,” Mr. Lumagui said.

Under the new law, the government expects to collect P105 billion from digital services VAT in the next five years.

RA 12023, which amended the National Internal Revenue Code of 1997, imposes a 12% VAT on foreign digital service providers. A 5% VAT will also be imposed on registered foreign suppliers rendering services to the government.

The law requires foreign digital service providers with gross sales or receipts over P3 million in the past year to register for VAT payments.

The BIR noted that digital services delivered by foreign digital providers are considered rendered in the Philippines if the services are consumed within the country.

Foreign digital service firms should also designate a representative office or agent in the Philippines.

Nonresident digital service providers include online search engines, online marketplace, e-marketplace, cloud service, online media and advertising, online platform, or digital goods. — Beatriz Marie D. Cruz

Illicit goods seizures hit P61B — BoC

October 3, 2024 | 9:18 pm

smuggled-cigarettes-20220608-BOC — BUREAU OF CUSTOMS

THE Bureau of Customs (BoC) said it has seized P61.16 billion worth of smuggled goods as of the end of August.

“Our border enforcement actions have (resulted in the apprehension of over) P61 billion worth of smuggled goods,” Leon P. Mogao, Jr. who heads the BoC’s Intelligence Division, told reporters on the sidelines of a forum on Wednesday.

The BoC recorded a total of 1,231 seizure operations in the eight-month period, Mr. Mogao said.

The top confiscated goods include counterfeit goods, cigarettes/tobacco/e-cigarettes/vape products, vehicles and accessories, and illegal drugs.

In its mid-year report, the BoC said it seized over P29.74 billion worth of counterfeit goods in the first half.

It also condemned 83 containers of seized and forfeited goods in the first half, it added.

During the six-month period, the bureau also confiscated P2.28 billion worth of illegal drugs from 80 seizure operations.

The most confiscated drugs were shabu or methamphetamine (P1.24 billion), marijuana (P934 million), and ecstasy (P92 million).

Under its Fuel Marking Program, the BoC marked P9.89 billion liters of fuel as of the end of June, generating around P121.72 billion in duties and taxes.

Agencies use a chemical marker in petroleum products to indicate whether these shipment are tax compliant.

In the first half, Customs filed 24 smuggling cases against 94 individuals. It also revoked the accreditation of 17 importers and customs brokers during the period.

The bureau shifted to a 24-hour operating schedule beginning June 13.

“These measures have not only augmented tax collection but also effectively deterred smuggling and illegal activities,” Customs Commissioner Bienvenido Y. Rubio said in the report.

Following its additional powers under Republic Act (RA) No. 12022 or the Anti-Agricultural Economic Sabotage Act, the BoC will enforce requirements set by regulatory agencies to curb acts of economic sabotage, Mr. Mogao said.

Under RA 12022, the bureau is empowered to examine under a Letter of Authority corporations or entities suspected of conducting acts of economic sabotage.

The Federation for Free Farmers said however that the government has failed to imprison smugglers and hoarders.

“Currently, the BoC policing its own ranks,” Mr. Mogao said, noting that cases have been filed against staff who may have contributed to failed prosecutions.

“For this year, I think three personnel were dismissed, and cases have been filed,” he added.

Meanwhile, the Navotas City Prosecutor recommended the filing of charges in connection with smuggled fuel transported in two fuel tanker vessels.

On Sept. 18, MT Tritrust and MT Mega Ensoleilee were found carrying smuggled fuel valued at P20.35 million.

At the end of August, Customs collections rose 5.66% year on year to P614.4 billion.

The BoC surpassed its P609.592-billion collection goal for the period by 0.85%, it said. — Beatriz Marie D. Cruz

Meat imports up 7.84% by volume in first 7 months

October 3, 2024 | 9:18 pm

THE volume of meat imports rose 7.84% in the seven months to July, led by beef, chicken, and pork, the Bureau of Animal Industry (BAI) reported.

The BAI said on Thursday that imports rose to 757.3 million kilograms.

Agriculture Assistant Secretary and spokesman Arnel V. de Mesa said that the increase in meat imports was driven by the anticipated low supply of pork due to the resurgence of African Swine Fever (ASF).

As of Sept. 20, 125 municipalities across 31 provinces had active ASF cases, the BAI reported.

“Expect higher imports versus last year,” Mr. De Mesa said via Messenger chat.

Meat imports in July declined 1.72% to 109.55 million kilos.

Accounting for about 49.25% of all imports, pork shipments rose 7.54% to 372.94 million kilos for the first seven months.

Spain supplied around 80.73 million kilos of pork, followed by Brazil (71.96 million kilos) and Canada (46.75 million kilos) during the period.

Shipments of chicken totaled 255.38 million kilos in the seven months to July. Shipments rose 2.41% and accounted for 33.72% of meat imports.

Brazil remained the top supplier of chicken with 121.14 million kilos, followed by the US (67.48 million kilos) and Australia (9.17 million kilos).

Beef imports increased 30.9% to 101.69 million kilos during the seven months, accounting for 13.43% of total meat imports.

Beef from Brazil amounted to 30.52 million kilos, followed by Australia (24.2 million kilos), and Ireland (7.7 million kilos).

Imports of turkey meat more than doubled to 897,369 kilos during the period.

Meanwhile, shipments of buffalo, duck, and lamb declined during the seven-month period.

Shipments of buffalo dropped 8.7% to 25.89 million kilos.

Imports of duck and lamb fell during the period by 51.32% to 97,270 kilos and by 17.33% to 401,066 kilos, respectively. — Adrian H. Halili

AI could be a ‘cost center’ if not aligned with business goals

October 3, 2024 | 9:17 pm

COMPANIES pursuing artificial intelligence (AI) initiatives could end up with AI being a cost center in the absence of alignment with their business goals, a data science professor said.

“The AI problem that they are pursuing is not aligned with the business goals. As a result, the company will not adopt it,” according to Professor Christopher P. Monterola, who holds the data science chair and heads the Aboitiz School of Innovation, Technology, and Entrepreneurship (ASITE) at the Asian Institute of Management (AIM).

At the 56^th FINEX Conference, Mr. Monterola warned of situations where culture and people are not ready to adopt the technology being developed.

He cited success stories such as an AI application used by the Bangko Sentral ng Pilipinas (BSP) to monitor financial accounts that reduced the review process from 20,000 man-hours per month to 11 minutes.

Mr. Monterola also noted a project by a conglomerate that can forecast the movement of people and wealth up to 20 years ahead.

“It’s important that we continue educating business leaders, and decision-makers on the technology and the benefits of AI, helping our organizations and even governments in improving productivity and efficiency,” Reynaldo C. Lugtu, Jr., the founder and chief executive officer of Hungry Work Horse Consultancy, Inc., said.

Mr. Lugtu said a distinction must be made between businesses that are service-oriented or product-oriented.

Service-oriented businesses require more people, a more human touch, empathy, collaboration, and other human elements, he said.

“The value proposition there is humans being assisted by AI. So AI can definitely help augment customer service,” he said.

Mr. Lugtu said the main impact of AI on product companies is in design and content, with the roles reversed — AI will be assisted by humans.

He cited the Work Trend Index 2024 report by Microsoft and LinkedIn, which found that 89% of leaders in the Philippines believe their company needs to adopt AI to stay competitive.

Nevertheless 55% of such leaders worry that their organization lacks a plan to implement AI. — Aubrey Rose A. Inosante

BCDA to explore zero-emissions aircraft development in Clark via Australian tie-up

October 3, 2024 | 9:17 pm

THE Bases Conversion and Development Authority (BCDA) said it signed a partnership with Australia’s AMSL Aero to explore the development of low-cost, zero-emission, and hydrogen-powered aircraft in New Clark City.

“The agreement with AMSL Aero will build a strong partnership with a world-leading sustainable aviation manufacturer,” BCDA President and Chief Executive Officer Joshua M. Bingcang said in a statement on Thursday.

“We look forward to progressing this partnership to achieve positive technological, economic, and social outcomes for the Philippines,” he said.

Aside from exploring opportunities in zero-emission aircraft, the BCDA said that the partnership with the Australian aircraft designer and manufacturer will also help start up the hydrogen production industry in the Philippines.

Under the partnership, BCDA and AMSL Aero will collaborate in developing an ecosystem for low-cost zero-emission aircraft and hydrogen energy.

“(This) has the potential to connect the archipelago of the Philippines by passenger and freight carriage air bridges, coupled with strategically located hydrogen production plants for clean energy production,” the BCDA said in a statement.

The partnership will generate a study evaluating the feasibility of developing the project within BCDA properties.

Max York, chief executive officer of AMSL Aero, said that the partnership with the BCDA can help drive the future of aerospace and clean energy production, as well as support economic development for the Philippines.

“The partnership agreement with BCDA … clearly demonstrates the global demand and opportunity for hydrogen-powered vertical takeoff and landing (VTOL) technology,” Mr. York said.

“(This) will enable AMSL Aero to further develop our innovative Vertiia technology to support multi-national requirements for passenger, cargo, air rescue, aeromedical, and military air operations,” he added.

AMSL Aero produces a world-leading long-range hydrogen-electric VTOL aircraft known as Vertiia. It takes off like a helicopter and flies fast and smoothly like a fixed wing airplane at very low cost per hour.

“The aircraft will be a highly efficient long-range zero-emissions VTOL, with a range of up to 1,000 kilometers and cruising speeds of 300 kilometers per hour,” the BCDA said. — Justine Irish D. Tabile

PSE index ends lower on last-minute profit taking

October 3, 2024 | 9:00 pm

THE MAIN INDEX slipped on Thursday as investors booked profits amid the escalating conflict in the Middle East and ahead of the release of September Philippine inflation data.

The benchmark Philippine Stock Exchange index (PSEi) dropped by 0.18% or 13.89 points to 7,388.92 on Thursday, while the broader all shares index rose by 0.29% or 11.80 points to 3,982.66.

“The local market closed lower this Thursday. The bourse was in positive territory for the most part of the day but was dragged by last-minute profit taking,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.

The PSEi opened at 7,406.79 and reached a high of 7,470.39 before succumbing to profit taking.

“Philippine shares ended slightly lower on rising Middle East tensions, following Iran’s missile attack on Israel. Investors are bracing for more uncertainty as Israel starts a ground operation in Lebanon and tensions escalate with Hezbollah,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

Israel bombed Beirut early on Thursday, killing at least six people, after its forces suffered their deadliest day on the Lebanese front in a year of clashes with Iran-backed Hezbollah, Reuters reported.

Israel said it had conducted a precise air strike on the Lebanese capital. Reuters witnesses reported hearing a massive blast, and a security source said it targeted a building in the district of Bachoura near parliament, the closest an Israeli strike has come to the central downtown district of Beirut.

“Locally, easing inflation expectations and strong manufacturing growth kept the market from drifting lower,” Mr. Limlingan added.

A BusinessWorld poll of 15 analysts yielded a median estimate of 2.5% for the September headline inflation.

If realized, this would be the slowest print in nearly four years or since 2.3% in October 2020. This would also be slower than 3.3% in August and 6.1% in the same month a year ago.

September consumer price index data will be released on Friday (Oct. 4).

Sectoral indices closed mixed on Thursday. Services dropped by 0.34% or 7.82 points to 2,274.57; holding firms went down by 0.24% or 15.03 points to 6,256.11; and property slipped by 0.02% or 0.62 point to 2,995.66.

On the other hand, mining and oil surged by 2.57% or 229.50 points to 9,146.91; industrials climbed by 0.38% or 37 points to 9,744.87; and financials rose by 0.23% or 5.57 points to 2,358.49.

Value turnover went up to P7.38 billion on Thursday with 1.01 billion shares traded from the P4.33 billion with 1.16 billion issues changing hands on Wednesday.

Advancers outnumbered decliners, 124 versus 83, while 49 names were unchanged.

Net foreign buying went down to P287.5 million on Thursday from P540.05 million on Wednesday. — R.M.D. Ochave with Reuters

Peso sinks to three-week low vs dollar

October 3, 2024 | 9:00 pm

THE PESO slumped to a three-week low against the dollar as the conflict in the Middle East continued and following dovish signals from the Bank of Japan (BoJ).

The local unit closed at P56.37 per dollar on Thursday, weakening by 19.2 centavos from its P56.178 finish on Wednesday, Bankers Association of the Philippines data showed.

This was the peso’s worst finish since its P56.385-per-dollar close on Sept. 10.

The peso opened Thursday’s session weaker at P56.30 against the dollar. Its intraday best was at P56.17, while its worst showing was at P56.40 versus the greenback.

Dollars exchanged went down to $1.73 billion on Thursday from $1.95 billion on Wednesday.

“The dollar-peso was well bid today on market risk aversion amid escalating tensions in the Middle East,” a trader said by phone on Thursday.

The dollar rose against the yen on Thursday amid cautious signals from the BoJ, which likewise caused the peso to weaken versus the greenback, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

The dollar scaled a more than six-week high versus the yen on Thursday as robustness in the US jobs market reinforced bets the Federal Reserve will not rush to cut interest rates, Reuters reported.

The yen has come under selling pressure since Japan’s new prime minister said on Wednesday, following a meeting with the central bank governor, that the country is not ready for additional rate hikes.

The safe-haven US currency saw additional demand as tensions simmered in the Middle East following Iran’s ballistic missile attack on Israel, which spurred a vow of revenge.

The dollar index, which measures the currency against the euro, yen and four other top rivals, added 0.22% to 101.88 as of 0540 GMT, a three-week peak.

The dollar added 0.14% to 146.66 yen after earlier reaching 147.25 for the first time since Aug. 20.

Dovish Bank of Japan policy maker Asahi Noguchi, who dissented against the rate hike in July, said the central bank must be patient in normalizing policy in a speech in Nagasaki.

On Wednesday, Japanese Prime Minister Shigeru Ishiba completed his backflip from perceived monetary hawk to dove, saying: “I do not believe that we are in an environment that would require us to raise interest rates further.”

For Friday, the trader sees the peso moving between P56.10 and P56.50 per dollar, while Mr. Ricafort expects it to range from P56.25 to P56.45 — AMCS with Reuters

SMB clashes with Converge in Game 4 of PBA quarterfinals

October 3, 2024 | 7:13 pm

Game on Friday
(Ninoy Aquino Stadium)
7:30 p.m. – Converge vs San Miguel Beer (Quarterfinals Game 4)*
*SMB leads best-of-five series, 2-1

THE CONVERGE FiberXers will be an emboldened lot following their epic Game 3 steal. The San Miguel Beermen (SMB) will be like an awakened dragon.

With fierce determination, the upset-conscious underdogs and favored heavyweights duke it out again on Friday in Game 4 of the PBA Governors’ Cup quarterfinal series at the Ninoy Aquino Stadium.

The FiberXers hope momentum is now on their side after fighting back from 25 points down to wrest a gritty 114-112 series-extending victory from SMB on Monday.

In between the third and fourth matches, the Beermen absorbed an 81-87 loss to Korea club Suwon KT Sonicboom in the East Asia Super League (EASL) opener on Wednesday, giving them a double-whammy heading to the 7:30 p.m. tiff with Converge.

“It’s still far,” cautioned Converge coach Franco Atienza amid the euphoria of stopping SMB’s sweep bid in the best-of-five contest and posting the franchise’s first victory in the PBA playoffs ever.

“It’s only one. It’s one of the three (wins needed to win the series). It’s hard to beat that team three straight (games). But we will take it one game at a time,” he added.

After taking care of business in the first two games, 102-95 and 107-100, the Beermen seemed on their way to cruising to a 3-0 blanking of Converge and setting up an awaited best-of-seven Final Four versus Barangay Ginebra before disaster struck. Riding on a 48-25 fourth-quarter storm capped by Alec Stockton’s winning jumper, the FiberXers spoiled SMB’s grand plans and lived to fight another day.

The seasoned bunch that they are, coach Jorge Gallent’s troops are quick to move on from the Game 3 slip-up.

“Life is like basketball. At your lowest point, you bounce right back up. As long as you go out to compete, play hard, play together as a team, you’ve got a chance,” said SMB import EJ Anosike.

“I could live with the result (Game 3 setback) and at the end of the day, you know it’s just a basketball game, we got another on Friday to get the job done,” he added.

While San Miguel and Converge settle their dispute, the Justin Brownlee-led Gin Kings are sitting pretty in the Final Four after sweeping Meralco in their side of the Last-8 on Monday.

Defending champion TNT is also through after disposing of NLEX in four matches and awaits the winner of the Game 5 rubbermatch between Rain or Shine and Magnolia slated on Saturday in Antipolo. — Olmin Leyba

Meralco starts EASL campaign with Black Bears win

October 3, 2024 | 7:12 pm

BOOTED out of the PBA Governors’ Cup title run, Meralco is challenging all its energy into its campaign in the East Asia Super League (EASL) Season 2 for now.

Just days after absorbing a bitter 0-3 sweep from Barangay Ginebra in the quarterfinal series, the Bolts returned to action for the EASL tipoff and took care of business against the Macau Black Bears, 97-85, on Wednesday at the MOA Arena.

The opening win in Group B enabled the reigning PBA Philippine Cup titlists to already match its total win in the previous season of the international league. As a group, the win worked as a balm for the pride bruised by the shutout defeat to old rival Ginebra.

“It’s a blessing for us to have the opportunity to bounce back not even three days later from the quarterfinal loss,” said Meralco ace Chris Newsome after venting their ire on the EASL expansion team.

“It’s definitely something that we needed as an organization, as a team, to kind of find our rhythm again and kind of have that fresh start. We were definitely able to get that win that we needed after losing three straight and I think that can do a lot for our confidence,” he added.

After Macau, the Bolts will go on the road on Oct. 16 to face Japan’s Ryukyu Golden Kings in Okinawa then host Korea’s Busan KCC Egis on Nov. 13 before returning to the PBA for the mid-season Commissioner’s Cup late November.

Against the Bears, Mr. Newsome fired 18 points and grabbed six rebounds while import Allen Durham posted a double-double of 17 markers and 11 boards for the Bolts, who pulled away in the second half and led by as many as 19 points.

Also delivering for Meralco were its second reinforcement, DJ Kennedy, who dished a 17-9-8 statline, Chris Banchero, who scored 14, and naturalized player Ange Kouame, who logged 9-9.

“It’s nice to win our first game here. We played with a lot of pride, although we didn’t play our best game,” said coach Luigi Trillo, whose charges finished with 1-5 last time, their lone victory posted in home-away-from-home Macau at the expense of Ryukyu. “At least we got one over here on our home turf.” — Olmin Leyba

The scores

Meralco Bolts 97 – Newsome 18, Durham 17, Kennedy 17, Banchero 14, Kouame 9, Almazan 7, Quinto 7, Hodge 4, Caram 2, Bates 2.

Macau Black Bears 85 – Cylla 23, Artino 23, Chongqui 21, Leung 10, Deguara 8, Chao 0, Li 0, Zeng 0, Lao 0, Chan 0.

Quarter scores: 24-17; 43-39; 73-64; 97-85.

College of St. Benilde clashes with unpredictable Arellano

October 3, 2024 | 7:11 pm

Games on Friday
(Filoil EcoOil Arena)
12 nn. – AU vs CSB
2:30 p.m. – JRU vs EAC

ON THE OUTSIDE, College of St. Benilde (CSB) looked like the victor with an NCAA Season 100 best 6-1 record.

On the inside, the Blazers carry the feelings of a vanquished.

“I’m looking for an explanation, an excuse for us on why this happened,” said CSB coach Charles Tiu, whose wards clash with unpredictable Arellano University on Friday at the Filoil EcoOil Arena at 12 noon.

Mr. Tiu remained livid after the Blazers nearly blew a 26-point lead before surviving the San Sebastian College-Recoletos Stags in a 96-94 overtime squeaker Tuesday that betrayed people’s expectation on them as a legitimate title contender.

“It’s one of the worst games I’ve been a part of this kind of team. We’re a Final Four team at the very least. I think for us to play like this, it’s like high school, or grade school the way we play,” said Mr. Tiu.

“We really have to do a better job,” he added.

Mr. Tiu said he will not be surprised if they lose to AU playing the same way they did the last time out.

“To me, they easily should be contending in the Final Four,” said Mr. Tiu referring to AU, which owns a 2-6 mark but most of its losses were nail-biting cliffhangers. “If we play like this, Arellano will beat us easily.”

Like AU, Emilio Aguinaldo College (3-4) and Jose Rizal University (2-5) will try to bolster their Final Four bids as they collide at 2:30 p.m. — Joey Villar