Peso may end Q1 at P56 a dollar amid skittish Fed easing timing

February 7, 2024 | 9:00 pm

By Aaron Michael C. Sy, Reporter

THE PHILIPPINE PESO may end above P56 against the dollar this quarter amid uncertainty about the timing of the US Federal Reserve’s easing cycle, according to MUFG Global Markets Research.

“We have raised our forecast for USD/PHP to P56.20 for Q1 2024, but kept our 12-month forecast at P55 for Q4 2024,” it said in a report on Wednesday.

The research firm expects the peso to close at P55.80 in the second quarter, at P55.30 in the third and at P55 in the fourth quarter.

The peso appreciated against the dollar on Wednesday after Federal Reserve Bank of Cleveland President Loretta J. Mester on Tuesday said the US economy performing as she expected could open the door to rate cuts.

But she was not ready yet to say when due to inflation uncertainty, Reuters reported.

“The peso strengthened following indications from Fed official Mester that the US central bank could consider a measured reduction in policy rates later this year, while rejecting the possibility of earlier cuts,” a trader said in an e-mail.

The peso closed at P55.95 a dollar, 25 centavos stronger than its close on Tuesday, Bankers Association of the Philippines data showed.

It opened at P56.08 strengthened to as much as P55.95 and weakened to as much as P56.12. Dollars exchanged went up to $1.29 billion from $1.26 billion on Tuesday.

MUFG Global Markets previously saw the peso closing at P55.40 in the first quarter, P55.30 in the second quarter, P55.20 in the third and P55 in the last quarter.

“In the near term, there could be some upside pressure still on the US dollar given uncertainty around the Fed’s rate path, coupled with the trajectory of global growth,” MUFG said.

Futures tied to the Fed’s policy rate late Tuesday showed investors assigning about a 20% chance of the Fed cutting interest rates in March, down from 64% a month ago, CME Group data showed.

The probability of a first rate cut coming in May, meanwhile, has increased to 55% from 37% a month ago. Investors were now pricing in a total of 122 basis points (bps) in cuts this year, from about 150 bps in mid-January, Reuters said.

The Federal Open Market Committee held its target rate steady at 5.25-5.5% for a fourth straight time at its meeting last week. It raised borrowing costs by 525 bps from March 2022 to July 2023.

While inflation settling within the Bangko Sentral ng Pilipinas’ (BSP) 2-4% target and a hawkish central bank could support the peso, the current account deficit would continue to drag it down, MUFG said in its report.

“Nonetheless, the read-through to the PHP is mixed,” it said. “While strong growth could boost equity inflows and keep the BSP hawkish for longer, what also matters for PHP is the trajectory of the current account deficit.”

The BSP expects a $9.5-billion current account deficit, equivalent to 2% of gross domestic product this year.

It expects the deficit to have narrowed to $11.2 billion (2.5% of GDP) last year from $18.1 billion (4.5% of GDP) in 2022. The current account deficit stood at $10.9 billion — equivalent to 3.5% of GDP — in the nine months to September.

Inflation slowed to 2.8% in January from 3.9% in November and 8.7% a year ago, the slowest since 2.3% in October 2020.

BSP raised borrowing costs by 450 bps from May 2022 to October 2023, bringing the policy rate to a 16-year high of 6.5%.

MUFG Global Markets Research expects the BSP to begin its easing cycle in the second half as inflation moves to the upper half of the 2-4% target. “We continue to expect the PHP to underperform other Asian FX in 2024, but only modestly,” it added.

Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said easing inflation had also supported the peso.

The trader expects the peso to weaken on Thursday “ahead of a potentially gloomy Chinese inflation report that might reignite concerns about the global economy.”

The trader sees the peso moving between P55.85 and P56.10 a dollar, while Mr. Ricafort expects it to trade at P55.90 to P56.10.

The peso has weakened by 1.04% or 58 centavos to date from its P55.37 close on Dec. 29.

PSEi continues rise on positive economic data

February 7, 2024 | 9:00 pm

PSE-720p-2 — PHILIPPINE STAR/KRIZ JOHN ROSALES

By Revin Mikhael D. Ochave, Reporter

PHILIPPINE stocks closed higher for the fourth straight time on Wednesday as investors absorbed positive economic data.

The 30-member Philippine Stock Exchange Index (PSEi) rose by 1.1% or 74.78 points to close at 6,830.04. The broader all-share index climbed by 0.78% or 27.71 points 3,566.76.

Claire T. Alviar, a research analyst at Philstocks Financial, Inc. attributed the increase to favorable inflation and job data.

The Philippine jobless rate dropped to 3.1% in December, bringing the full-year figure to 4.3%, a record low, the local statistics agency said on Wednesday.

January inflation also slowed to 2.8% from 3.9% in December and 8.7% a year earlier, the second straight month that prices were within the central bank’s 2-4% target.

Stocks likewise advanced on the back of stronger US markets, Ms. Alviar said in a Viber message. “Moreover, positive cues from the US markets, driven by strong corporate earnings, coupled with the expectation of an interest rate cut by the Federal Reserve, boosted the sentiment further.”

The Dow Jones Industrial Average Index rose by 0.37% or 141.24 points to 38,521.36 on Feb. 6; the S&P 500 Index gained 0.23% or 11.42 points to 4,954.23; the Nasdaq Composite added 0.07% or 11.32 points to 15,609; and the New York Stock Exchange Composite Index advanced by 0.77% or 130.70 points to 17,135.48.

The Philippine stock market closed higher amid lukewarm overseas sentiment, Luis A. Limlingan, head of sales at Regina Capital Development Corp., said in a Viber message. “Sentiment was also lukewarm overseas as investors parsed through another slate of quarterly results halfway through the corporate earnings season.”

Almost all of the market’s sectoral indexes closed higher except for mining and oil, which fell by 0.6% or 54.83 points to 9,088.89.

Services gained 2.13% or 35.77 points to 1,711.95; property increased by 1.63% or 47.79 points to 2,963.85; holding firms rose by 1% or 64.22 points to 6,443.81; industrials went up by 0.62% or 56.84 points to 9,190.92; and financials inched up by 0.29% or 5.6 points to 1,933.85.

“Among the index members, Ayala Corp. was at the top, increasing by 6.4%, while DMCI Holdings, Inc. lost the most by 2.37%,” Ms. Alviar said.

Value turnover rose to P6.33 billion with 829.44 million issues changing hands compared with 749.46 million issues worth P4.76 billion on Tuesday.

Advancers beat decliners 112 to 80, while 49 shares were unchanged.

Net foreign buying increased to P1.21 billion from P44.45 million worth of net foreign inflows on Tuesday.

Chiefs coach Reid bemused by Super Bowl conspiracy theory

February 7, 2024 | 8:57 pm

AGA projects Americans to wager $23.1 billion

LAS VEGAS — Kansas City head coach Andy Reid’s no-nonsense countenance cracked for just a second on Tuesday when he was asked to address one of the wilder theories circulating Las Vegas in Super Bowl week.

There isn’t much the seasoned 65-year-old hasn’t encountered in a storied career, but he was almost lost for words when a German reporter asked him about theories being espoused that the National Football League (NFL) had somehow “scripted” the romance between Chiefs tight end Travis Kelce and Taylor Swift to allow the pop star to use the Super Bowl to bolster support for Joseph R. Biden in the presidential election.

“Hmmm,” Reid smiled, before suddenly shaking his head in bemusement. “That’s way out of my league. Very similar to me speaking German,” he guffawed.

“But listen, I appreciate the question. She’s been great,” he said of Ms. Swift’s support, before adding “We had a nice visit with President Biden last year, but that’s about as far as I can go with that.”

NFL Commissioner Roger Goodell had on Monday laughed off the claims as the run-up to Sunday’s Super Bowl between Kansas City and San Francisco has been dominated by stories surrounding the relationship between the world’s biggest pop star and the Chiefs player.

While Mr. Goodell said the “Taylor Swift effect” is positive for the league, the singer has become a target for allies of former President Donald Trump, with some spreading conspiracy theories that her relationship with Mr. Kelce was part of an NFL plan to get Mr. Biden back into the White House.

“I don’t think I’m that good of a scripter — or anybody on our staff,” laughed Mr. Goodell. “Listen, there is no way I could have scripted that one, let’s put it that way.”

Ms. Swift backed Mr. Biden in 2020 and while she has not announced support for any candidate ahead of this year’s election some Republican party supporters are convinced she will use the Super Bowl spotlight to call on her army of fans, known as “Swifties,” to vote Democrat.

Vivek Ramaswamy, who dropped out of the presidential race last month before throwing his support behind Mr. Trump, said in January on the social media platform X: “I wonder who’s going to win the Super Bowl next month.”

“And I wonder if there’s a major presidential endorsement coming from an artificially culturally propped-up couple this fall. Just some wild speculation over here, let’s see how it ages over the next 8 months.”

WAGER $23.1 BILLION
The first Super Bowl at Las Vegas will see an estimated $23.1 billion wagered in the United States on Sunday’s game between the Kansas City Chiefs and San Francisco 49ers, according to the American Gaming Association (AGA).

The AGA also estimates that 67.8 million American adults will have a financial stake in the game in some form, with the rise of online betting fueling a $16-billion increase in wagering from last year’s Super Bowl.

A total of $23.1 billion is expected to be on the line for Super Bowl LVII.

The group’s survey showed that 47 percent of will wager on the defending champion Chiefs, while 44 percent will have a wager on the 49ers.

According to DraftKings, as of Tuesday, the 49ers were two-point favorites, with an over/under on total points at 47.5.

The most popular access point for wagering on Sunday’s game will be to bet online, with 46 percent of the 67.8 million participants taking that route. The number is equal to 26 percent of the United States population.

Casual wagering friends is listed at 36 percent, while a mere 11 percent will wager at a physical sportsbook.

Online wagering is expected to increase by 41 percent from last year’s Super Bowl, while casual wagering is projected to be up 32 percent.

Traditional wagering (online, sportsbook, bookie) is expected to be ahead of casual wagering (friends, pools, square contests) for the second consecutive year.

Messages about responsible wagering have reached the masses, with AGA reporting that 75 percent of traditional Super Bowl betters have reported seeing a message on responsible wagering in the past year. — Reuters

Four weigthlifters vying to join Obiena, Marcial in July’s Paris Olympics

February 7, 2024 | 8:56 pm

Rosegie Ramos — ROSEGIE RAMOS -- REUTERS

IF THE STARS align, there is a strong chance the Philippines will have four weightlifters in this July’s Paris Olympics.

“We have around four lifters who will represent us in the Paris Olympics, barring no injuries to all of these four,” said Samahang Weightlifting ng Pilipinas President Monico Puentevella.

Mr. Puentevella was referring to Rosegie Ramos, Vanessa Sarno, John Fabuar and one between Tokyo Olympics gold medalist Hidilyn Diaz-Naranjo and another Olympian Elreen Ando.

The 20-year-old Ms. Ramos has practically planted a foot in Paris after zooming to the top five in her women’s 49-kilogram division after she recently struck silver and bronze in the Asian Championships in Tashkent, Uzbekistan.

The Zamboanga City native would just need another solid effort in another Olympic-qualifying event in Phuket, Thailand next month to join pole-vault star EJ Obiena and Tokyo boxing bronze winner Eumir Marcial, who already booked their tickets to Paris.

Ms. Sarno, 20, for her part, is also seeing action in Tashkent and if she does well there, she too would close in on that glorious slot to the quadrennial games.

The same goes with Mr. Fabuar, who also hails from Cebu like Ms. Ando.

For Ms. Ando, who had a couple of silver in Tashkent, she is battling Diaz-Naranjo tooth and nail for that hotly contested spot in the women’s 59kg class as only one slot is allowed per division per country in the Olympics.

And it will boil down to how Ms. Ando, who slightly trails Ms. Diaz-Naranjo, will perform in Bangkok.

“As of now, Hidilyn (Diaz-Naranjo) leads by a small margin,” said Mr. Puentevella, who thanked the Philippine Sports Commission, SM Group of Companies and the MVP Sports Foundation for financing the Tashkent trip. — Joey Villar

Cavitex rules Leg 6 of PBA 3×3 Season 3 Third Conference

February 7, 2024 | 8:54 pm

CAVITEX barely made the knockout rounds of Leg 6 of the PBA 3×3 Season 3 Third Conference after a stumbling 1-2 start in pool play. But such opening was all the Braves needed to drive their way back to the summit after a 12-leg drought.

The quartet of Jorey Napoles, Ken Ighalo, Bong Galanza and Clint Doliguez completed the dream ending with a 20-18 triumph over first-time finalist Blackwater Tuesday night at Market! Market!

Cavitex flirted with elimination after logging a victory against Purefoods (22-20) versus losses to the Smooth Razor (18-20) and MCFASolver (12-17) in Pool C Monday.

But the Braves caught a break when the Titans upset the Tech Centrale in Tuesday’s elims windup, 17-15, forcing a three-way tie for second among them at 1-2. After the tiebreak, Cavitex took the No. 2 seed behind unbeaten Blackwater (3-0) while Purefoods grabbed the third and last quarterfinal ticket.

The Braves made the most of this opportunity, beating Barangay Ginebra in the Last-8, 21-17, then Leg 5 winner TNT in the semis, 18-16, before clawing back from 17-18 to steal the gold from the Smooth Razor.

Cavitex banked P100,000 after topping a leg for the first time since snaring back-to-back in Legs 4 and 5 of the season’s First Conference.

Blackwater’s RJ Deles (eight), Wendell Comnoy (seven), Dariel Bayla (three) and Rey Publico earned P50,000 after giving the franchise its best finish ever.

Meanwhile, the Triple Giga beat three-leg ruler Meralco, 21-16, for third place and P30,000. — Olmin Leyba

Cameroonian Collins Akowe grabs MVP award in UAAP Season 86 boys’ basketball

February 7, 2024 | 8:53 pm

COLLINS AKOWE has been crowned as the Most Valuable Player (MVP) in the University Athletic Association of the Philippines (UAAP) Season 86 boys’ basketball tournament to make it a back-to-back feat for National University-Nazareth School (NUNS).

Following the footsteps of now Bulldog Reinhard Jumamoy, the Cameroonian big man proved to be head and shoulders above his high school peers by running away with a whopping 96.7 statistical points for the Bullpups.

The 6-foot-10 ace normed a monstrous double-double averages of 17.14 points and 21.07 rebounds laced by 2.21 blocks and 1.64 assists to become the first foreign student-athlete to win MVP in UAAP juniors basketball history. “I promised my coach I would give him the championship. I made that promise from the very beginning,” said Mr. Akowe, a Grade 11 center. “I need to fulfill my promise. I need to give it all I have to win the championship.”

Mr. Akowe dropped 26 points and 11 rebounds in Game 1 of the ongoing finals but NUNS fell short against Adamson University, 77-71. Game Two is being played as of press time.

Joining Mr. Akowe in the Mythical Team were De La Salle Zobel’s Kieffer Alas (89.727 SP), Ateneo de Manila University High School’s Kristian Porter (85.786), University of Santo Tomas’ Doy Dungo (81.286) and Adamson’s Tebol Garcia (72.385).

University of the Philippines Integrated School’s Nathan Egea was named Rookie of the Year with 58.500 SPs behind averages of 10.5 points, 10.5 rebounds, 3.0 assists and 1.5 steals per game. — John Bryan Ulanday

Jordan stuns South Korea, 2-0, to reach first Asian Cup final

February 7, 2024 | 8:52 pm

AL RAYYAN, Qatar — Jordan upset South Korea 2-0 in their Asian Cup semifinal on Tuesday at the Ahmed bin Ali Stadium where Yazan Al-Naimat and Musa Al-Taamari scored second-half goals to guide them into the final for the first time.

The result was a stunning upset for Jordan, who are ranked 87^th in the world but played with nothing to lose against South Korea who are the third-best team in Asia, 64 places above them.

South Korea had made a habit of scoring late goals in the tournament but there was no comeback this time as Jordan kept them at bay to book their place in the final, where they will face either Iran or hosts and defending champions Qatar.

“The players delivered a heroic performance. The X-factor was we didn’t need to give South Korea more respect than needed,” Jordan’s Moroccan coach Hussein Ammouta said.

“Based on their record in their last few games, they conceded goals and we knew it was possible to score against them, that was the turning point.”

Mr. Al-Naimat had scored in the 2-2 draw when the two teams met in the group stage and the 24-year-old was once again the tormentor-in-chief with his nimble footwork while Mr. Al-Taamari’s tireless running also bore fruit.

In a goalless first half, Mr. Al-Naimat had the best opportunity to score for Jordan when he skipped past three defenders in the box, but his shot was hit straight at goalkeeper Jo Hyeon-woo who made a reflex save.

At the other end, Lee Jae-sung nearly opened the scoring for South Korea when Son Heung-min sent a cross into the box but the midfielder’s header came off the post to give Jordan a reprieve.

DEFENSE-SPLITTING PASS
Yet Jordan finally found the breakthrough when Al-Taamari intercepted a poor back pass in midfield and found Al-Naimat with a defense-splitting pass for the forward to chip the ball over the keeper and score his third goal of the tournament.

Jordan celebrated the goal just as they did against Iraq in the last-16, with Al-Naimat’s team mates sitting around him as he pretended to hand them cups of tea.

Al-Taamari had been the busiest player on the pitch and he picked his moment to shine when he made a solo run past a static defence and curled his effort past the keeper to send Jordan’s fans among the 42,850 in the arena into raptures.

“This victory started with the fans but I should say the coach said this was a match where we should have fun. We would like to dedicate it to the people of Morocco,” Mr. Al-Taamari said.

“I dreamed about this Asian Cup one month ago, I started to train with that mentality when I was in France (with Montpellier). It means everything to me that we’re in the final.”

South Korea coach Juergen Klinsmann had no answer to Jordan’s press and fluid attacks as the German stood on the touchline stone faced, watching his team exit the tournament without a single shot on target in the semifinal.

“Obviously we’re disappointed. We had the big goal of playing in the final but Jordan deserves this win, they deserve to play in the final,” Mr. Klinsmann said.

“They played more aggressively, they won almost every one-v-one battle and they got better.”

The German said he accepted responsibility for South Korea’s exit but did not offer to resign.

“I’m not planning to do anything, I will analyze this tournament, go back to Korea with the team and talk with the federation about what was good and not so good in the tournament.” — Reuters

Joel Embiid out at least four weeks after knee procedure

February 7, 2024 | 8:52 pm

REIGNING league Most Valuable Player (MVP) Joel Embiid will be sidelined at least four weeks following a knee procedure Tuesday, the Philadelphia 76ers announced.

The star center underwent the procedure to address an injury to the lateral meniscus in his left knee. Mr. Embiid, 29, has missed five of the past six games, with the Sixers losing four of the five contests he sat out.

The two-time defending NBA scoring champion and 2022-23 MVP is averaging 35.3 points, 11.3 rebounds, 5.7 assists and 1.8 blocks but has played in just 34 of Philadelphia’s 49 games.

As part of the NBA’s new collective bargaining agreement, players must play a minimum of 65 regular-season games to be eligible for certain awards, including MVP, Defensive Player of the Year and the All-NBA teams.

The four-week mark from Tuesday is March 5, meaning Mr. Embiid would miss 11 or 12 more games before his injury is re-evaluated. He will also miss the All-Star Game, to which he was voted a starter, on Feb. 18 in Indianapolis. — Reuters

Trae Young and Scottie Barnes named All-Star injury subs

February 7, 2024 | 8:51 pm

ATLANTA’S Trae Young and Toronto’s Scottie Barnes are headed to the National Basketball Association (NBA) All-Star Game as injury replacements.

Commissioner Adam Silver announced Tuesday that they will replace Philadelphia’s Joel Embiid (knee) and New York’s Julius Randle (shoulder) on the Eastern Conference roster on Feb. 18 in Indianapolis.

It’s the third All-Star appearance for Mr. Young, 25, who is averaging 27.3 points and 10.9 assists through 45 games (all starts) for the Hawks this season. He was a starter in the 2020 and 2022 All-Star contests.

Mr. Barnes, 22, will be making his All-Star debut. The former Rookie of the Year is averaging 20.2 points, 8.1 rebounds and 5.8 assists in 50 games (all starts) for the Raptors this season. — Reuters

Sportsbooks: I Bet You Think About (Taylor Swift)

February 7, 2024 | 8:51 pm

AS Taylor Swift continues to introduce millions of new viewers to the NFL, via her relationship with Kansas City Chiefs tight end Travis Kelce, the league sits back and smiles at the fresh passive-income revenue streams coming its way.

The phenomenon is no different in the world of sports betting, where bookmakers are cashing in on Taylor Swift-related Super Bowl prop bets.

In the United States, licensed sportsbooks are not able to offer Swift-specific props such as what outfit she will wear, how many times she’ll appear on the broadcast and whether she will cry at the game’s conclusion.

Regulations state that domestic prop wagers must involve on-field activity. But that’s not the case for offshore sportsbooks and those operators based in Ontario, Canada.

SWIFT-ONLY OFFERS
In addition to the options mentioned above are props having to do with what could happen on the field after the game.

Will Mr. Kelce propose to Ms. Swift?

Such a silly possibility? Not so fast. At BetUS, a Costa Rica-based operation and one of the offshore operators, the prop was listed as recently as last weekend at only 6-1 odds that it would happen.

That might be a reflection of the book managers balancing the action due to an influx of “yes” money from a legion of hopeful Swifties.

Ms. Swift’s lipstick color is another popular market, though an upset seems unlikely since “red” has been her hue of choice even before she burst onto the Chiefs’ scene. The other option: “any other color.”

The Swift props are not just window dressing for those books able to take action, however.

The BetUS public affairs director, Tim Williams, told the New York Times it’s a sound business decision.

“We expect to see as much interest, if not more interest, in all of these Taylor Swift bets compared to bets related to the halftime show,” Mr. Williams told the New York Times, “and that’s really unprecedented.”

A word of warning: Those unregulated sportsbooks may not be legal, depending on where in the US a wager is made, and the Swift bets will frequently be limited to $100 or less.

BetOnline, another offshore book, has no fewer than 89 Swift props. It’s an intentional number, referencing Ms. Swift’s platinum-selling album 1989, as well as the year she was born.

The restrictions found among US sportsbooks on Swift bets are more relaxed in Ontario, Canada.

Bettors there wagering via theScore Bet can decide on whether Ms. Swift will be shown during Reba McEntire’s performance of the national anthem. The sportsbook believes it’s a strong possibility, placing the odds at -200.

Will Ms. Swift enjoy the halftime show? The sportsbook believes there’s a little less than a coin-flip chance that she’ll appear on TV during the halftime show (+120).

Their over/under for the total number of times Swift pops up on the Canadian TV broadcast is 5.5 occurrences (the “over” is +120).

It’s no su

Will Taylor Swift be seen mouthing a curse word during the CBS Super Bowl telecast? (Yes, +300/BetUS)

Will Taylor Swift’s navel be shown on CBS? (Yes, +800; No, -2500/BetOnline)

Which will have more diamond carats? (Taylor Swift engagement ring, -10000; Chiefs Super Bowl ring, +1400/BetOnline)

A SWIFT LEAN ON POLITICS
There’s no questioning the Taylor Swift influence on pop culture, but waves of the population stand poised to see whether the superstar’s presence at the Super Bowl wades into US political waters.

Former President Donald Trump is a frequent contributor to political narratives and has been included among the Swift Super Bowl props.

Mr. Trump is a 3-1 choice to reference Ms. Swift via his platform TruthSocial on Super Bowl Sunday. Both sides of the presidential race will be represented with 10-1 odds via BetUS that Swift endorses President Joseph R. Biden after the game.

THE SWIFTY-SB COMBO
The primary licensed sportsbooks in the US, including DraftKings and ESPNBET, have their own spin on how to involve the 14-time Grammy winner.

The bets frequently come with their own names.

ESPNBET has the “Swift Action” prop that pays +1200 if a touchdown is scored within the game’s first two minutes as well as “MVP Swelce,” which is Kelce’s MVP odds (+1500).

DraftKings has a nod to Swift songs with “Mine,” a prop on Kelce’s receiving yards (87+ at +190) and “Anti-hero,” a prop on the opposing quarterback Brock Purdy’s passing performance (250+ yards and two TD passes at +200).

THE MVP BET
BetMGM’s Ontario, Canada, operation has an “MVP mentions Taylor Swift” prop. Early this week, the odds were +650 that the Super Bowl MVP refers to Swift in the postgame, on-field interview, while “no” comes in at -1200.

Pro tip: If you’re in a place to bet live on that prop and Kelce has 10 catches and a pair of first-half touchdowns, hammer that “yes” option before everyone gets on board.

Even Swift props couldn’t escape the sharp money, however. FanDuel Canada had +1060 that Kelce proposes to Swift on the field. The company reported the “no” option opened at -250 but was quickly bet up to -3000.

Is there no one who believes in romance anymore? — Reuters

NEDA cites need to lower telco barriers to entry

February 7, 2024 | 8:39 pm

THE National Economic and Development Authority (NEDA) called for reforms to the telecommunications industry that reduce barriers to entry, promote open access, and enhance spectrum management.

“The telecommunications sector in the Philippines is currently at a crossroads, marked by robust demand against a backdrop of challenging geography and market concentration,” it said in a policy note on Wednesday.

The NEDA said that the industry faces challenges such as high costs, slow broadband speed and inadequate coverage.

“The impact of insufficient data transmission infrastructure spans multiple sectors such as education, business process outsourcing (BPO), healthcare, and disaster response,” it added.

According to Ookla, the Philippines was 64^th among 145 countries in terms of mobile internet speed and 48^th out of 181 in fixed broadband speed as of November.

“A significant concern is the growing digital divide, especially among lower-income groups, signaling an urgent need for policy intervention,” it added.

NEDA cited the franchise and licensing system as an area needing reform.

“The current franchise and licensing process is a significant barrier to new entrants. Reforming this regime, particularly through the removal of the franchise requirement, will simplify market entry and enhance sector competitiveness,” it said.

“Streamlining these processes will create a more dynamic telecommunications environment,” it added.

The policy note also emphasized the need for open access.

“Current market dynamics, marked by high entry barriers and limited competition, necessitate legislation for an open access framework,” it said.

“This policy will allow new entrants to challenge the dominant market players, leading to increased efficiency, reduced costs, and improved service quality. Open access is essential to disrupt the existing market structure, mitigate monopolistic practices, and foster innovation,” it added.

Meanwhile, NEDA said that the current policies on spectrum management are “unclear and fragmented.”

“A new legislative framework is imperative to optimize this finite resource, ensuring transparent allocation and efficient use. This approach will enable new technologies and services, contributing significantly to the sector’s growth,” it said.

It recommended revising spectrum user fees and introducing competitive auctions for spectrum allocation, among others.

“The reforms are designed to bridge the digital divide, enhance service quality, and ensure the Philippines keeps pace with an increasingly digital global economy,” NEDA said.

“The ultimate goal is to cultivate a telecommunications sector that supports the socioeconomic advancement of the Philippines,” it added. — Luisa Maria Jacinta C. Jocson

Miners say attracting investment to require additional incentives

February 7, 2024 | 8:38 pm

By John Victor D. Ordoñez, Reporter

MINERS said more fiscal incentives are needed to attract investment and called on Congress to ensure that any proposed mining fiscal regime should help raise the industry’s competitiveness.

“The inclusion of mining in Investment Priority Projects and the granting of fiscal incentives or novel mining projects, particularly those that will significantly improve employment or the economy in the area” were among the industry’s priorities, Michael T. Toledo, chairman of the Chamber of Mines in the Philippines, said in a Viber message.

He also urged Congress to pass a bill creating mining economic zones to regulate mining projects.

State Department Undersecretary for Economic Growth, Energy, and Environment Jose W. Fernandez has said Washington is hoping to establish more partnerships with the Philippines involving the processing of nickel, cobalt and copper.

He said that high energy costs are keeping miners and semiconductor companies from investing in the Philippines.

Miners are open to working with the US to enhance domestic mineral processing and boost ore exports, Mr. Toledo said.

“There are no ongoing talks of tie-ups yet as we know it and we have yet to see the details of this proposal,” he said.

“Nevertheless, any discussion on the expansion of our mineral export markets, be they ore or processed, is most welcome.”

He added that all supply agreements from Philippine ore exporters covered by contracts must still be honored following this development.

The House of Representatives in September approved on third and final reading a bill that seeks to establish a new fiscal regime for the mining industry through the imposition of margin-based royalties and a windfall profit tax on large-scale miners.

Mr. Toledo said the current mining fiscal regime is more burdensome than those of Indonesia, Chile, Peru and South Africa.

“The addition of income-based taxes being proposed in HB 8937 will make the structure (of mining taxes) more palatable as higher taxes will be paid at higher operating margins when metal prices are high,” he said. “And conversely, lower taxes when metal prices are low or when operations are not profitable.”

Mr. Toledo said the government must harmonize national and local laws on mining and taxation.

Under House Bill No. 8937, large-scale metallic mining operations inside mineral reservations will pay the government 4% of their gross output.

On the other hand, small-scale miners will be charged royalties equivalent to a 10^th of 1% of their gross output.

Currently, mining firms must pay corporate income tax, excise tax, royalty, local business tax, real property tax, and fees to indigenous communities. A mining fiscal regime measure has yet to be filed before the Senate.

“The addition of income-based taxes being proposed in HB 8937 will help sustain existing mining operations and encourage quality investments in the hugely untapped Philippine minerals sector,” Mr. Toledo said.

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