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Peso to stay at P56 level ahead of PHL GDP data

JULIAN PAOLO DAYAG-UNSPLASH

THE PESO is expected to remain at the P56-per-dollar level this week as the market awaits the release of Philippine gross domestic product (GDP) data and the US Federal Reserve’s policy decision.

The local unit closed at P56.29 per dollar on Friday, strengthening by 24 centavos from its P56.53 finish on Thursday, Bankers Association of the Philippines data showed.

Week on week, the peso weakened by 32 centavos from its P55.97 finish on Jan. 19.

The peso opened Friday’s session at P56.50 against the dollar. Its intraday best was at P56.29, while its weakest showing was at P56.54 versus the greenback.

Dollars exchanged went down to $1.38 billion on Friday from $1.47 billion on Thursday.

The peso strengthened against the dollar on Friday amid hawkish signals from the Bangko Sentral ng Pilipinas (BSP) chief, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

BSP Governor Eli M. Remolona, Jr. said last week that the central bank is unlikely to cut rates at its Feb. 15 meeting amid lingering risks to inflation.

“At this point, a rate cut is not likely (on) Feb. 15,” Mr. Remolona said in mixed English and Filipino, adding that the “numbers we are seeing” show the need to keep policy settings sufficiently tight for some time.   

The Monetary Board hiked borrowing costs by 450 basis points (bps) from May 2022 to October 2023, bringing the key interest rate to a 16-year high of 6.5%.

“[The peso-dollar] pair was supported on dips today, following the robust US GDP data overnight,” Security Bank Corp. Chief Economist Robert Dan J. Roces said in a Viber message on Friday.

The US economy grew faster than expected in the fourth quarter amid strong consumer spending, and shrugged off dire predictions of a recession after the Federal Reserve aggressively raised interest rates, with growth for the full year coming in at 2.5%, Reuters reported.

Gross domestic product increased at a 3.3% annualized rate last quarter after advancing at a 4.9% pace in the third quarter, the Commerce Department’s Bureau of Economic Analysis said.

Economists polled by Reuters had forecast GDP rising at a 2.0% rate. Estimates ranged from a 0.8% rate to a 2.8% pace. The economy is expanding at a pace above what Fed officials regard as the non-inflationary growth rate of 1.8%.

Growth last year accelerated from 1.9% in 2022, and was the fastest in two years. From the fourth quarter of 2022 through the fourth quarter of 2023, the economy grew 3.1%, blowing away economists’ estimates for a 0.1% contraction back in December 2022.

For this week, the peso could stay at the P56 level as the market awaits the release of fourth quarter and full-year 2023 Philippine GDP data, Mr. Roces said.

Philippine economic growth likely slowed in the fourth quarter of 2023 to bring the full-year expansion below the government’s target, analysts polled by BusinessWorld said.

GDP likely grew by 5.7% in the fourth quarter of 2023, based on the median estimate of 20 economists polled by BusinessWorld.

This would be slower than the 5.9% growth logged in the third quarter of 2023 and the 7.1% expansion seen in the same period in 2022.

For 2023, GDP growth may have averaged 5.5%, short of the government’s 6-7% target. This would be well below the 7.6% expansion in 2022.

The market will also await the Fed’s policy decision this week, Mr. Ricafort added.

The US central bank is widely expected to keep the fed funds rate steady at the 5.25-5.5% range during its Jan. 30-31 meeting.

The Federal Open Market Committee raised borrowing costs by a total of 525 bps from March 2022 to July 2023.

Mr. Roces expects the peso to move between P56.20 and P56.80 per dollar this week, while Mr. Ricafort sees it ranging from P56 to P56.50 against the greenback. — A.M.C. Sy with Reuters

Agriculture output rebound seen possible in 2023 on base effects

PHILIPPINE STAR/KRIZ JOHN ROSALES

By Adrian H. Halili, Reporter

A REBOUND in agricultural output was deemed likely in 2023, with analysts citing the low base the industry is coming off  in 2022.

“We forecast growth of 1.3% this 2023 with crops and poultry contributing significantly,” former Agriculture Secretary William D. Dar said in a text message.

“Very hard to determine. But since we are coming from a low base in 2022, I would not be surprised if there is a slight uptick in output in real terms,” Federation of Free Farmers National Manager Raul Q. Montemayor said in a Viber message.

If the forecasts are borne out, they would reverse the 0.1% contraction in the value of production in agriculture and fisheries in 2022, at constant 2018 prices.

The decline in 2022 output was due to weak production in crops and fisheries, according to the Philippine Statistics Authority (PSA).

Agriculture production fell 0.3% in the third quarter of 2023.

Agriculture accounts for about a tenth of gross domestic product  and around a quarter of all jobs.

Earlier, Agriculture Assistant Secretary and Spokesperson Arnel V. de Mesa told reporters that the DA is expecting “positive growth” in agriculture output for 2023 though the growth would fall below 3-4%.

Mr. De Mesa said that the lack of major typhoons and disasters during the fourth quarter likely improved overall farm output for the year.

The DA’s official target is 2.3%-2.5% growth in 2023.

Mr. Montemayor said that the growth in production would be buoyed by “generally good weather” and higher farmgate prices, mainly for palay or unmilled rice.

The National Food Authority (NFA) raised buying prices for palay in September to P19-23 per kilogram for dry and P16-19 per kilo for wet palay.

Palay production for 2023 was initially estimated to have grown 1.53% to 20.06 million metric tons (MT), exceeding the 20 million MT target set earlier by the DA.

“Historical high, yes, but actually a minimal increase, not even enough to offset population and demand growth. (Gross Value Added) palay grew much larger due to an increase in farmgate prices,” Mr. Montemayor added.

The national farmgate price for palay rose 14% to an average of P19.89 per kilo in 2023.

National daily consumption of rice is equivalent to 33,983.5 MT or 679,670 bags, according to the NFA.

Elias Jose M. Inciong, president of the United Broiler Raisers Association, said the poultry segment has continued to be a growth driver in overall agricultural production.

However, the H5N1 Highly Pathogenic Avian Influenza (HPAI), or bird flu, continues to hinder further growth, Mr. Inciong added.

“HPAI will always be a concern unless and until we have effective vaccines for breeders and layers,” he said.

In November, the DA released guidelines for the deployment of bird flu vaccines to be administered to commercial farms for layer chicken, layer chicken breeders, broiler chicken breeders, free-range breeders, grandparent broiler breeders, as well as small-hold layer/native chicken, duck, game fowl, turkey, and goose farms.

The DA said that it will give priority in deploying protective emergency vaccines to areas with a high concentration of HPAI cases.

He said that the poultry industry will likely post 4% to 6% growth this year, “if we can minimize disruptions from imports and provide strong domestic support.”

“Livestock and fisheries are still struggling. There is African Swine Fever (ASF) contributing largely to the level of performance of the pig industry,” Mr. Dar added.

About 21 provinces have active cases of ASF as of Jan. 18, according to the Bureau of Animal Industry (BAI).

Production in the fisheries sector contracted 5% in 2022, and 6.1% during the third quarter of 2023.

The Bureau of Fisheries and Aquatic Resources (BFAR) is enforcing closed season on several major fisheries.

Last year, sardine fishing was banned between Nov. 15 and Feb. 15. This coincided with the closure of fishing in the Visayan Sea for small pelagic fish, including sardines.

Sardine fishing was also banned in northern Palawan between Nov. 1 and Jan. 31, while a closed season for herring and mackerel in the Visayan Sea was declared between Nov. 15 and Feb. 15.

The PSA is set to release its fourth quarter and full-year data for agricultural output on Jan. 30.

‘No-new-taxes’ pledge highlights balancing act between taxpayer relief, hitting revenue goals

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

By Luisa Maria Jacinta C. Jocson, Reporter

THE Department of Finance (DoF) decision not to introduce new taxes this year points to a focus on improving tax collection efficiency and providing relief to the public, though it runs the risk of failing to raise sufficient revenue, analysts said.

“No new or additional tax this year is a brilliant move,”  Bienvenido S. Oplas, Jr., president of a research consultancy and of the Minimal Government Thinkers think tank, said in a Viber message, noting that tax hikes have short- to long-term inflationary impact.

Finance Secretary Ralph G. Recto has said he does not plan to introduce any new taxes, citing the need to minimize inflation and improve tax administration.

“The focus on improving tax administration is also good. High incidence of smuggling and illicit trade is a clear example of poor tax administration…so this is a good fiscal consolidation measure,” Mr. Oplas said.

Albay Rep. Jose Maria Clemente S. Salceda earlier estimated that taxes forgone from tobacco smuggling at P60 billion in 2023.

“It is also prudent first to maximize tax revenue collections from existing tax laws and intensify compliance as well as encourage the payment of the right taxes, before adding new tax laws or raising tax rates,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Mr. Ricafort said that new or higher taxes may be considered once inflation is no longer a risk.

“Inflation has been the priority for more than a year already. It is a tough balancing act in fulfilling the mandates of price stability and fiscal performance sustainability in terms of increasing recurring sources of revenues for the National Government while also having more disciplined government spending through good governance standards,” he added.

Headline inflation averaged 6% for 2023, slightly higher than the 5.8% in 2022. This also marked the second straight year that inflation breached the central bank’s 2-4% target band.

Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms, said that optimizing tax collection may not be enough to generate much-needed revenue.

“Tax administration by itself will not significantly boost tax effort especially in the short term. We tried that route before but it was not responsive to the problem especially when the fiscal space is a binding constraint,” he said via Facebook Messenger chat.

Mr. Recto has said that the DoF is currently working on tweaking current tax proposals to make them fairer and easier to collect.

In particular, Mr. Recto said that the department fine-tuned proposals for the motor vehicle user charges (MVUC) reform and the Passive Income and Financial Intermediary Taxation Act (PIFITA).

He noted that other priority tax proposals will be “more or less be the same,” such as the rationalization of the mining regime, the tax on single-use plastics, and value-added tax (VAT) on digital service providers.

However, the Finance Secretary also said that revenue gains from priority tax reforms are expected to be lower than initially projected.

“The revenue gains we will frontload. The revenue losses we will backload,” Mr. Recto told reporters on the sidelines of an event Friday.

The DoF estimates that revenue from the PIFITA will yield P12.2 billion between this year and 2028. Earlier projections had estimated revenue at P21.2 billion between 2024 and 2026.

The PIFITA seeks to “encourage growth in key financial markets by simplifying the tax structure on passive income, and on certain instruments and other financial products,” the DoF said in an earlier statement.

“Under the proposal, the DoF seeks to maintain the structure of some products and instruments while deferring the implementation of certain provisions by 2028 or when the government will have been in a better fiscal position,” it added.

Mr. Recto said the DoF has also fine-tuned the MVUC proposal to “consider the impact of the new rates on inflation, particularly in the transportation and logistics sectors.”

The reform is expected to raise P36 billion between 2024 and 2028. This is lower than earlier estimates of P46.8 billion for 2025 to 2026.

The rationalization of the mining fiscal regime will help “encourage growth in the sector while ensuring that the government still gets its fair share of the profits from mining activities.”

It is estimated to generate P47 billion in incremental revenue between 2024 and 2028. Previous projections indicated that the reform would generate P52.6 billion between 2025 and 2028.

The DoF hopes to raise P4.3 trillion in revenue this year.

Meanwhile, Mr. Recto said that there has been interest from investors in the Maharlika Investment Fund (MIF).

He and the rest of the Maharlika Investment Corp. (MIC) board met last week. “We are still organizing. I think it will take time… There seems to be interest in investing in Maharlika from what I’ve heard. There are potential investors,” he said.

In a statement on Sunday, the DoF said the board approved the remittance of funds from the account of the Bureau of the Treasury (BTr) to the sovereign wealth fund.

“The BTr shall transfer the contributions to the account of MIC within five business days from receipt of the relevant Board Resolution,” it said.

The MIC has an authorized capital stock of P500 billion. Initial capital of P125 billion will be provided by the Land Bank of the Philippines (LANDBANK) and Development Bank of the Philippines (DBP), which will supply P50 billion and P25 billion, respectively. The National Government will also contribute P50 billion.

Both state banks remitted their contributions to the sovereign wealth fund to the BTr last year.

“The Board likewise approved the motion to appoint the LANDBANK and DBP as depository banks of the MIC which is consistent with DoF Department Circular No. 002.2022 stating that GOCCs (government-owned and -controlled corporations) may deposit and maintain government funds with the two banks without the need for prior approval from the Secretary of Finance,” it added.

The fund will prioritize investments in infrastructure, oil, gas, and power, agroforestry industrial urbanization, mineral processing, tourism, transportation, and aerospace and aviation.

“The commercial objective of the MIC is geared towards obtaining optimal absolute returns and maximizing financial gains on its investments in the short to medium term,” the DoF said.

“In the long term, the developmental objective is to promote economic development by making strategic and profitable investments in key sectors,” it added.

The MIC Board is set to meet again in February.

Tourism recovery seen held back by delayed return of China visitors

Tourists are seen at the beach of Boracay island, Aklan province. — PHILIPPINE STAR/KRIZ JOHN ROSALES

THE RECOVERY of the tourism market lags the rest of the region due to infrastructure constraints and the slow rebound of visitor arrivals from China, analysts said.

Michael L. Ricafort, chief economist of Rizal Commercial Banking Corp., said the Philippines’ tourism performance was lagging even before the pandemic.

“There has been a lot of catching up since the pandemic and also even before the pandemic with other ASEAN or Asian neighboring countries,” Mr. Ricafort said in a Viber message.

“This is largely due to infrastructure constraints that limit the capacity of airports and accommodation and MICE (meetings, incentives, conferences, & exhibitions) facilities to cater to a much larger number of foreign tourists,” he added.

In 2023, the Philippines logged 5.4 million international visitors which is only 65% of the 8.24 million foreign arrivals seen in 2019, but at par with the 65% average within Asia and the Pacific.

Mr. Ricafort said upgrades are needed to airports, particularly the Ninoy Aquino International Airport (NAIA), which will share future traffic to and from the capital with the Bulacan and Sangley airports.

“There is a need as well as for integrated tour packages that will be cheaper and more convenient to attract more foreign tourists,” he said.

“There is also a need for more mass transport systems such as railways that are integrated into major airports to make it more convenient for local and foreign tourists to travel,” he added.

China Banking Corp. Chief Economist Domini S. Velasquez said slow growth can be attributed to geographical constraints and absence of Chinese tourists.

“The Philippines lags behind its other ASEAN neighbors in terms of tourist arrivals, which can be attributed partly to geographical constraints, as the country cannot be accessed by land,” Ms. Velasquez said in a Viber message.

“However, another factor contributing to the below-target numbers, especially during the pandemic, is the absence of Chinese tourists,” she added.

Before the pandemic, China was the country’s second top source of international arrivals after South Korea. However, China only ranked fifth last year.

South Korea remained the top source of international visitors accounting for 26.41%, followed by the US (16.57%), Japan (5.61%), Australia (4.89%), and China (4.84 %).

“The sluggish growth and high unemployment in China have hindered the phenomenon known as “revenge travel,” wherein Chinese tourists typically exhibit strong travel demand. As a result, the expected influx of Chinese tourists has been limited,” Ms. Velasquez said.

Mr. Ricafort said the Philippines has strong potential in further growing the tourism economy with much room to improve in many elements of the product offering.

“The tourism business is low-hanging fruit that can generate more business, employment, and other economic activities as a major source of growth or a bright spot for the economy,” he said.

The United Nations World Tourism Organization (UNWTO) projected international tourism to fully recover to pre-pandemic levels this year, with some markets expected to surpass 2019 levels by 2%.

However, the UNWTO said that the rebound is subject to the pace of recovery in Asia and the resolution of various conflicts.

“There is still significant room for recovery across Asia. The reopening of several source markets and destinations will boost recovery in the region and globally,” it said.

“Chinese outbound and inbound tourism is expected to accelerate in 2024, due to visa facilitation and improved air capacity. China is applying for visa-free travel for citizens of France, Germany, Italy, the Netherlands, Spain and Malaysia for a year to Nov. 30,” it added.

The Manila International Airport Authority (MIAA) said it remains optimistic in the growth of passenger traffic in NAIA this year.

“As stated in our earlier release, 2023 passenger movements hit 45.39 million. This is still lower than our 2019 data or pre-pandemic levels, where we handled 47.69 million passengers,” MIAA said in a Viber message.

“But… from 2020 to 2022, passenger traffic has been growing. So we are expecting higher passenger traffic this year compared to 2023, possibly reaching pre-pandemic levels,” it added.

The MIAA said passenger traffic rose 47% last year versus the 30.94 million passengers seen in 2022.

The Department of Tourism set a 7.7 million international visitor target this year, which if borne out would be equivalent to 93% of the foreign arrivals in 2019. — Justine Irish D. Tabile

BCDA extends filing deadline for Clark ICT project bidders

THE Bases Conversion and Development Authority (BCDA) said that it will be extending the deadline to submit the eligibility requirements for an information and communications technology (ICT) project in New Clark City to Feb. 16.

In a statement, the BCDA said the extension was granted at the request of prospective bidders.

“We understand that to do this project effectively, we will need the expertise of the private sector who can help us create a vibrant and innovative competitive market for ICT services via an Open Access Model,” BCDA President and Chief Executive Officer Joshua M. Bingcang said.

“This project is key to unlocking the potential of New Clark City as a smart and sustainable metropolis where its citizens have equal access to fast, reliable and affordable internet services,” he added.

The project involves building the foundation of fiber infrastructure and providing retail internet services across the 9,450-hectare zone.

It will be executed through a joint venture, with the bidder expected to handle the commercialization, expansion, repair, and maintenance of the passive ICT infrastructure.

The project seeks to incorporate an open access model in its underground network which will allow multiple data transmission providers to use it to offer retail services in the area.

The commercialization of the passive ICT infrastructure is viewed as a first step in developing a smart city with enhanced connectivity and the capacity to host data centers.

“Once fully developed, New Clark City is projected to become the home of about one million residents, with projected employment of about 200,000 workers,” the BCDA said.

Mr. Bingcang said in a recent briefing that the head of BCDA’s Joint Venture Committee is working with the Asian Development Bank to work out the procurement process for the ICT project.

He added that 18 companies attended the pre-bid conference, with at least three companies purchasing the bidding documents.

“But because this is a multi-discipline project, I think most of them will consolidate and form a consortium because some are contractors, others are IT (information technology) providers, the others are funders, etc. And you all need that in this project,” he said. — Justine Irish D. Tabile

Formal employment in establishments rises in August 2022 survey — PSA

PHILIPPINE STAR/RUSSELL A. PALMA

THE NUMBER of people employed in formal establishments rose to 5.37 million in August 2022 from 5.32 million in June 2020, the Philippine Statistics Authority (PSA) reported.

The results were contained in the PSA’s 2021/2022 Integrated Survey on Labor and Employment. The comparative periods are irregular due to disruptions from the pandemic.

The services sector had the largest workforce with 3.78 million, followed by industry with 1.45 million and agriculture, forestry and fishing with 139,190. — Abigail Marie P. Yraola

How agile corporate reporting builds confidence

As businesses grow, finance leaders face increasing stakeholder demand for timely and accurate financial and non-financial corporate reporting. Moreover, organizations must consider how they can keep up with current and future demands, and how they can provide accurate stakeholder reports in a timely manner.  

CORPORATE REPORTING AND STAKEHOLDER DEMANDS
Corporate reporting provides a comprehensive picture of an organization’s financial and non-financial information, which can assist stakeholders and other relevant users in their decision-making. Furthermore, finance leaders can use corporate reporting to communicate the value their businesses create for people, society, and the environment.

There is also increasing stakeholder demand for non-financial information, such as sustainability reports that highlight a company’s environmental, social, and governance (ESG) commitments. This development continually influences businesses, encouraging more responsible and sustainable practices. Moreover, evolving accounting principles and other regulatory requirements are continually obliging organizations to report more reliable and relevant information about their performances, positions and their level of compliance. The increasing stakeholder demands trigger the need for finance leaders to revisit their transformation agenda on their finance functions.

According to the 2023 Global EY DNA of the CFO Report, 16% of finance leaders believe their finance function delivers best-in-class performance, with only 14% of respondents planning to pursue a bold transformation agenda over the next three years.  The small number may imply that there is a hesitancy to adopt new and inventive ways of working.

COMMON PITFALLS
Through the years, finance leaders have faced the challenge of meeting internal and external stakeholder demands to comply with the financial reporting standards and regulatory guidelines. As such, some corporate reporting policies, processes, and controls have not yet been transformed to align with organizational needs and demands, resulting in a lack of confidence among stakeholders.   

There are some common pitfalls to watch out for in corporate reporting:

Substantial reliance on manual processes. Even though some organizations have Enterprise Resource Planning (ERP) systems, there are still some corporate reporting processes being done manually. In the 2021 EY 7th Global Corporate Reporting Survey, 56% of finance leaders said that “there has been resistance to some of the changes we have had to introduce.” In addition, 51% said “finance team members have sometimes failed to adopt new processes, reverting to traditional ways of doing things.” These entities normally have siloed systems that rely on spreadsheets to reconcile corporate reports from different systems. Spreadsheets are prone to human error, making them unsustainable since processes may become more complex as entities evolve.

Policies are not aligned with regulatory reporting requirements and business demands. Policies are vital to corporate reporting controls. If they are not aligned with regulatory requirements and business demands, they can reduce efficiency and effectiveness in decision-making. Recently, there have been significant changes with regulatory reporting requirements, such as financial reporting standards. Despite these changes, some organizations have not yet updated their policies, which may lead to the inappropriate and inconsistent application of procedures and processes. Consequently, this misalignment may result in fines, litigations, or other consequences to an organization if this non-compliance has a material effect on its corporate reporting.

Outdated employee skillsets. Due to today’s fast-paced technological innovations, regulatory changes, and consumer demands, some employees may need to upskill. Moreover, limited skill development may lead to poor performance and outdated corporate reports. According to the 2023 EY Global DNA of the CFO survey, 19% of the finance leaders surveyed said that talent together with risk are the least priorities for finance transformation over the next three years.

BUILDING CONFIDENCE
Addressing these pitfalls can help organizations achieve agile corporate reporting. To do so, finance leaders need to integrate their processes, policies, and people. Additionally, they need to focus on the following areas:

Invest in technology to digitalize processes. The 2023 EY Global DNA of the CFO survey shares that 44% and 36% of the finance leaders are now prioritizing technology transformation and advanced analytics, respectively. Finance leaders need to leverage investments in technology and digitalization to standardize and simplify the corporate reporting process. They must also explore new ways of working where data is integral to unlocking the value of business portfolios. They need to implement integrated systems to provide accurate and real-time reports, leveraging automation from technology. These solutions will enable faster and better decision-making, shifting the focus of finance from back-office bookkeeping to being a trusted business advisor within the organization.

Align policies with regulatory reporting requirements and business demands. In aligning policies, finance leaders need to ask themselves whether their organizations have all the necessary policies in place. They also need to determine how their policies compare to those of their industry peers, and if their internal users and customers are satisfied with the policies. Lastly, after determining if the policies are user-friendly, they need to identify the key policy gaps related to regulatory requirements and business demands.

Once policies are aligned and updated, finance leaders must ensure their organizations also have a “policy on policies.” This overarching guidance will help define when to create, update, or decommission policies, including approval requirements for these changes.

Equip next generation leaders with the right skills and tools. Finance leaders can assess the skill gaps of their existing employees, encourage professional development, and reconcile both to align with business requirements. Any updated policies and processes should be cascaded to employees, especially those that require continuous training and education. These steps will help organizations ensure that the talent assigned to their tasks are aligned with current business and stakeholder demands.

THE FUTURE OF CORPORATE REPORTING
Finance leaders need to transform their corporate reporting agenda beyond the numbers, starting with a cultural change on their mindset and behavior. This journey can serve as a challenge and an opportunity to create long-term value for the whole enterprise, improve current ways of working and develop next-generation leaders. When finance leaders consider these, they can rebuild confidence and drive value for the organization today and tomorrow. 

 This article is for general information only and is not a substitute for professional advice where the facts and circumstances warrant. The views and opinions expressed above are those of the authors and do not necessarily represent the views of SGV & Co.

 

Anna Maria Rubi B. Diaz is an assurance partner under Financial Accounting Advisory Services (FAAS) and Sheena Dyan C. Suarez is a FAAS director of SGV & Co.

Philippine opposition steps up unity efforts amid administration breakup

PHILIPPINE STAR/KRIZ JOHN ROSALES

By Kyle Aristophere T. Atienza, Reporter

PHILIPPINE opposition forces have started building coalitions as the political alliance led by President Ferdinand R. Marcos, Jr. faces internal rumblings amid the government’s Charter change (“Cha-cha”) push.

Bagong Alyansang Makabayan (Bayan), one of the largest coalitions in the country, said it’s talking with various groups to form a “broad movement” that will oppose constitutional amendments, which are being pushed by allies of Mr. Marcos in Congress and through a so-called people’s initiative.

“We are targeting a nationwide multisectoral protest in time for the EDSA anniversary,” Bayan Secretary-General Raymond D. Palatino said in a Facebook Messenger chat on Sunday.

“We plan to sustain this into a political education movement aimed at making more people aware that instead of merely choosing the lesser evil between the two brutal dynasties, the challenge is how to mainstream good governance and democratic rule,” he added.

On Sunday, at least two major political gatherings were held in the Philippines, one of which was an administration-led rally in the capital Manila under the theme “Bagong Pilipinas” (New Philippines), which the President and Vice President Sara Duterte-Carpio attended.

In Davao City in southern Philippines, the staunchest allies of ex-President Rodrigo R. Duterte held a leaders’ forum attended by Victor D. Rodriguez, Mr. Marcos’s former executive secretary and campaign manager in the 2022 elections.

The group is also opposing the people’s initiative for Charter change, a move that has been linked to House lawmakers including Speaker and presidential cousin Martin G. Romualdez.

On the same day, supporters of the former President’s daughter, Ms. Duterte-Carpio, held a rally a few meters away from Quirino Grandstand, where Marcos supporters gathered.

“As the unity team implodes, it is important to take advantage of the split in the ruling coalition by advancing people’s demands such as accountability from the Dutertes, protecting rights and pushing for reforms in policies,” Mr. Palatino said.

Akbayan Party and other groups under Tindig Pilipinas are also “building a strong alternative center of power against Cha-cha advocates and the Dutertes,” party President Rafaela David said via Messenger chat.

“The month of February will give birth to this new and pluralist gathering,” she said. “We will reject the toxic and cynical politics of the ruling elite and strive to forge a new path that embraces inclusivity, transparency and good governance.”

Bayan and Akbayan have major political differences and had been political foes in the past. These political groups, which have united on key issues under the Duterte government, are opposing changes to the country’s 36-year-old charter, which was crafted after a people power uprising that toppled the dictatorial regime of Mr. Marcos’s namesake and late father.

In pursuing ties with other forces, Akbayan said its objectives are clear — “to defeat Cha-cha, exact accountabilities from the Dutertes and a major electoral advance in 2025.”  “Winning the first two allows us the best chance at realizing the third objective.”

The Marcos government’s Bagong Pilipinas kick-off rally — attended by thousands, according to the Palace — comes amid a widening gap between Mr. Marcos and the vice-president, who both ran as a tandem in 2022 under a platform of unity.

In a statement, Ms. Duterte-Carpio said she would attend the administration rally but said she also supports the anti-Charter change event in Davao City.

House lawmakers in October last year moved to strip Ms. Duterte-Carpio of her confidential and intelligence funds under this year’s budget amid widespread public criticism. In response, Mr. Duterte had accused Mr. Romualdez and his colleagues of corruption and called on the public to stop paying taxes.

‘DEMONS IN THE PALACE’
Tensions between Mr. Romualdez and the Dutertes have become apparent after congressmen removed former President and Pampanga Rep. Gloria Macapagal Arroyo in May from her senior deputy speakership post and then again in November as a deputy speaker.

Mr. Marcos has veered away from key policies of the Duterte government, including standing up to China and boosting security ties with the United States.

Lawmakers including presidential sister and Senator Maria Imelda “Imee” R. Marcos are seeking an inquiry into the people’s initiative amid allegations of corruption.

Last week, the 24-member Senate issued a statement against the move, saying it is “ridiculous” for the Senate to have a “dispensable and diluted role” in the “Cha-cha” push.

In a prayer rally organized by an influential evangelical group on Saturday, the President’s sister prayed for enlightenment for her brother: “May you touch the heart of my brother, the President of the Philippines. Open his eyes and enlighten his mind and distance him from the demons around him in the Palace.”

“We have learned that in building unities, we need to prepare early and base our coming together on clear political objectives,” Ms. David of Akbayan said. 

Anthony Borja, who teaches political science at De La Salle University in Manila, noted that if traditional opposition forces — from leftists to liberal — could avoid being dragged into factional conflicts within the administration provide a convincing image of a united opposition, “then they can emerge as an alternative.” 

“Simply put, if traditional opposition forces can claim the promise of unity without excluding the disillusioned, then they can benefit from the breakdown of the ruling coalition,” he said via Messenger chat.

“The Marcoses and Dutertes have lost the credibility to speak about change,” Bayan said. “They are in fact responsible for the continued backward state of the country. They are mobilizing people for self-serving and sinister motives using government machinery and resources.”

CNN Philippines closure not good for local news ecosystem

CNN PHILIPPINES WEBSITE

THE IMPENDING closure of CNN Philippines eight years after debuting on Philippine free television does not bode well for the country’s ailing information ecosystem, analysts said, as profitability among news channels in Asia’s oldest democracy remained a challenge.

“Any closure of a news media organization that tries to practice responsible journalism means one less source of information,” Danilo A. Arao, who teaches journalism at the University of the Philippines (UP), said in a Facebook Messenger chat on Sunday.

CNN Philippines, which starting airing on Philippine free TV in March 2015, is set to make a major announcement on Monday amid reports that losses at the Cabangon family’s Nine Media Corp., the network owner and operator, had topped P5 billion.

Nine Media has an airtime deal with state channel Radio Philippines Network (RPN-9), which charges the company a monthly airtime fee of P8.2 million.

Mr. Arao said the closure of another media company — years after ABS-CBN Corp. was forced off air after legislators rejected its franchise renewal — should be “a wake-up call for news media owners to be more mindful of sustaining operations while taking care of its journalists and media workers.”

He cited the evolution of RPN 9 to Solar News, to 9 News, and then to CNN Philippines.

“The latter turned out to be a white elephant in the sense that depending on a global brand turned out to be unsustainable due to the high cost,” he said. “May this be a lesson to all of us that we don’t need to be outward-looking in running a news media organization.”

Nine Media paid license fees to Turner Broadcasting System Asia Pacific, Inc. for the CNN brand worth P139.3 million in 2022, up from P108.09 million a year earlier, GMA News reported, citing financial statements from 2021 to 2022.

Rachel E. Khan, a journalism professor at UP, said a largely information-only platform that heavily focuses on news and talk shows is not financially viable in a country like the Philippines.

“Sadly, Filipinos are only hungry for news when it has an obvious direct impact on them such as disaster-related news,” she said via Messenger chat. “Moreover, with the growth of online media, audiences can now pick and choose what they want to be informed about.”

She noted that GMA Network, Inc., the largest local TV network with 101 TV stations and 21 radio stations last year, and ABS-CBN “make most of their income in the entertainment industry, not the news industry.”

“Also, when it comes to breaking local news, people still rely on the longer-running shows such as 24 Oras and TV Patrol,” she added.

The closure of CNN Philippines will happen weeks before the ABS-CBN News Channel, a 24/7 pay TV news channel, goes off air on its main platform SkyCable, which will close shop on Feb. 27.

JOB LOSS
Terrestrial and cable TV viewing is still substantial in the country “despite the presence of streaming services and video-sharing social media platforms,” Mr. Arao said.

Data from Kantar showed that about 93 million people still watch TV, with about 22 million households that own television sets, he noted.

Ms. Khan said the closure of CNN Philippines would not have the same impact as the closure of ABS-CBN since it only has a 24% audience share based on Reuters’ 2023 Institute Digital News Report.

“Its local coverage was largely Metro Manila-based, and it was also airing imported news programs that any interested person could also watch on the CNN International cable channel,” she said. “What saddens me the most is the loss of more jobs in the news industry.”

CNN Philippines has about 300 employees, according to the Philippine Daily Inquirer.

Ms. Khan said the creation of a publicly traded media corporation, which Filipinos should be willing to invest in, is needed if the country wants a truly independent source of information.

“That was Mr. Raul Locsin’s formula, which unfortunately ended with his death.”

Mr. Locsin, a 1999 Ramon Magsaysay awardee, founded Business Day, Southeast Asia’s first daily economic newspaper, in 1967. It led to the birth of BusinessWorld in 1987.

Mr. Arao said a substantial decrease in TV news viewership would only happen if the country would have better information technology infrastructure that can reach remote areas.

A survey by Pulse Asia Research, Inc. in September 2021 showed that TV was Filipinos’ top source of news on government affairs and politics with a 91% share.

It was followed by radio at 49%, online platforms at 48% and newspapers at 3%.

“The decreased viewership on ‘old TV’ right now may be felt in more developed urban areas, but that is not the case in rural areas where even the most basic social services are absent,” Mr. Arao said. — Kyle Aristophere T. Atienza

AMLC denies false freeze orders, warns Filipinos against scams

By Keisha B. Ta-asan, Reporter

THE ANTI-MONEY Laundering Council (AMLC) has denied being the source of a freeze order covering two accounts at a certain bank and urged the public to be more vigilant against fake documents.

In an advisory posted on its website, the AMLC said it has received an inquiry from a concerned citizen regarding the validity of a certain Certification dated Dec. 8, 2023.

“After scrutinizing the aforementioned inquiry, the AMLC discovered an alarming scheme wherein a scammer deploys a deceitful and counterfeit Certification to make it appear that the accounts of specific individuals and/or entities have been subjected to a freeze order issued by the AMLC,” it said.

The dirty money watchdog said the certification, which indicated an alleged finding of probable cause for violation of the Terrorism Financing Prevention and Suppression Act of 2012, was found to be “spurious.”

“The AMLC denies the issuance of the fraudulent and spurious document denominated as Certification dated 8 December 2023, issued to a certain bank. Any document and/or certification of similar tenor is not genuine, nor authorized by the AMLC,” it said in a statement.

“We hereby caution the public to disregard any emails, letters, or documents of similar nature, as these are confirmed to be fraudulent,” it added.

The AMLC said its doors are open for inquiries and encouraged individuals who have been scammed or suspected of having encountered suspicious documents.

“The AMLC strongly advises individuals to promptly report such deceptive activities to the relevant law enforcement authorities,” it added.

Based on the 2021 Sanctions Guidelines of the AMLC, the council has the authority to issue freeze orders and issuances against individuals and entities listed in the United Nations Security Council (UNSC) Consolidated List and those designated by the Anti-Terrorism Council (ATC).

This is consistent with the Philippines’ international obligations to comply with terrorism-related resolutions, including the UNSC Resolution No. 1373 pursuant to Article 41 of the UN Charter.

Under the law, the AMLC, either upon its own initiative or at the request of the ATC, may order to freeze property or funds related to terrorism financing without delay.

All individuals and entities whose properties or funds were frozen may avail the remedies under the Republic Act No. 11479, or the Anti-Terrorism Act of 2020.

The Anti-Terrorism Act of 2020, which provided for the creation of the ATC, is meant to strengthen the country’s measures against terrorist financing and dirty money.

The Philippines is hoping to exit the Financial Action Task Force’s “gray list” of jurisdictions under increased monitoring for dirty money risks by October this year.

The country has been on the gray list since June 2021.

Bigger pay for nurses sought

PHILSTAR FILE PHOTO

AS THE NUMBER of nursing graduates who took the licensure exams for the United States doubled last year, a lawmaker underscored on Sunday the need to increase the base pay of Filipino nurses to keep them in the local health sector.

“We must increase the base pay of our public nurses who are now being ‘pirated’ aggressively by hospitals in America and other countries,” Quezon City Rep. Marvin D. Rillo said in a statement.

The number of nursing graduates who took the nursing licensure exams in the US doubled to 36,410 in 2023 from 18,617 a year earlier, Mr. Rillo noted.

House Bill No. 5276, which seeks to increase the base pay of nurses by 75% to encourage them to work domestically has been pending at the House appropriations panel since 2022. If enacted into law, the starting pay of nurses would jump up to P63,997.

The base pay of nurses is currently under salary grade 15, or a minimum of P35,097 per month.

On the other hand, Senate Bill No. 638, which proposes to increase the salary grade of nurses to 19 from the current 15, is pending at the Senate civil service panel.

Citing 2021 data from the US Bureau of Labor Statistics, Mr. Rillo said nurses working in America receive an annual median pay of $81,220 (about P4.57 million) in 2022.

Mr. Rillo also noted that several local hospitals are struggling to enhance their services due to the lack of nurses.

“We have received reports that many local governments in the provinces are unable to upgrade their hospitals simply because they lack nursing service staff,” he said.

He urged local governments and private corporate foundations to offer scholarships to encourage students to take up nursing. — Beatriz Marie D. Cruz

Prolonged detention questioned

VISITING United Nations Special Rapporteur for Freedom of Opinion and Expression Irene Khan gestures before Philippine Justice Undersecretary Raul Vasquez after their dialogue in Manila on Jan. 24. — THE PHILIPPINE STAR/ERNIE PENAREDONDO

UNITED NATIONS Special Rapporteur on Freedom of Opinion and Expression Irene Khan questioned the prolonged detainment of two Filipino human rights defenders and a journalist.

“We were (the) only international visitors so far allowed by the Philippine government to visit them,” Ms. Khan said in an X post on Sunday, after visiting human rights defenders Marielle Domequil and Alexander Abinguna as well as journalist Frenchie Mae Cumpio at the Tacloban City Jail.

“Arrested in 2020, [and the] trial [is] still dragging on,” she noted. “How long must they wait to be free!?”

The three had been arrested in 2020 on illegal firearms charges which they dispute as allegedly fabricated.

Official records from the Philippine Army’s 8th Infantry Division said raiding teams recovered pistols, live ammunition, two grenades, and a flag of the Communist Party of the Philippines from the accused.

On Sunday, the National Union of Journalists in the Philippines (NUJP) also called for their release, saying they are victims of fabricated charges.

“NUJP asserts that the three should not wait any minute longer to be free,” it said in a statement. “The evidence against them were planted and the testimonies against them falsified.”

Ms. Khan arrived in Manila on Jan. 23 for a 10-day visit that involves discussions with state officials, civil society groups and other human rights groups on freedom of expression issues and challenges in the Philippines. — John Victor D. Ordoñez

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