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MPT steps up proposal to ease traffic in Baguio

MPT Mobility Corp., the innovations arm of Metro Pacific Tollways Corp. (MPTC), secured original proponent status from the local government of Baguio for its technology-driven mobility solutions.

“It was given original proponent status [in August]. We are now undergoing negotiations. After we come up with the terms for the negotiations then we will proceed with the Swiss challenge,” Mark Richmund M. de Leon, vice-president for Smart Mobility Solutions, told reporters in a press chat on Monday.

In July, the company announced that it submitted an unsolicited proposal valued at P2.5 billion to provide smart urban mobility solutions to a local government unit.

“The current modality is a concession agreement but of course, everything will be undergoing negotiations [to determine] what’s the best on their side,” Mr. De Leon said.

According to Donald Saurombe, assistant vice-president for business development, the company’s proposal would deploy integrated and tailor-fit systems for Baguio, including traffic management solutions, area-based monitoring, smart command centers, parking systems, and transportation fleet management support.

The company is also looking at the replacement of the number-coding scheme by introducing a congestion fee in Baguio, Mr. Saurombe added.

“Instead of number coding, you will just have to pay a congestion fee if you choose to drive. It is supposed to shift the behavior of the motorist to be able to think about when they want to drive — during congested times or choose a less congested time to make a trip,” he said.

A congestion pricing scheme is a fee charged to drivers for traveling in certain key areas at a specific time, which is a concept aimed at easing traffic.

Mr. De Leon declined to say how much the congestion fee would be, noting that the company already surveyed the willingness of motorists to pay the charge.

“We came up with that magic number. We have that number that we proposed to Baguio, and the response was positive. Majority of the people are willing to pay,” he said, adding that the congestion pricing will only be implemented during peak hours.  

In 2020, the Department of Transportation said the National Economic and Development Authority’s technical working group was evaluating the proposal for a peak hours congestion pricing system in certain parts of Metro Manila.

“Congestion charging is very successful in other key cities. We’re not just addressing traffic [and] congestion per se, but addressing the whole transport system of the city. It’s only for Baguio for now,” Mr. De Leon added.

The pricing scheme is expected to reduce in Baguio by up to 15%, Mr. De Leon said.

MPTC is the tollways unit of Metro Pacific Investments Corp., one of three key Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Ashley Erika O. Jose

Digital banks struggle with lending — BSP chief

BANGKO SENTRAL ng Pilipinas Governor Eli M. Remolona, Jr. — BANGKO SENTRAL NG PILIPINAS

DIGITAL BANKS find it difficult to disburse loans and collect payments from borrowers, the Bangko Sentral ng Pilipinas (BSP) chief said, with the regulator continuing its close monitoring of the sector.

BSP Governor Eli M. Remolona, Jr. said they have placed digital banks in a regulatory sandbox to test innovations and minimize risks in the sector. 

“Digital banking is one of those in the sandbox. We’ve issued six licenses. These guys are actually very successful in collecting deposits just online. (But) they’re still struggling with figuring out how to make loans. That’s the hard part. That’s why they’re still in a sandbox,” he said during the Philippine economic briefing in Iloilo City on Monday.

In 2021, the BSP imposed a moratorium on the grant of digital banking licenses as it seeks to monitor the development of the sector, ensure competition among the new players, and boost its own capacity to regulate these new types of lenders.

The six online banks that secured licenses to operate in the country were Tonik Digital Bank, Inc.; GoTyme Bank of the Gokongwei group and Singapore-based Tyme; Maya Bank of Voyager Innovations, Inc.; Overseas Filipino Bank, a subsidiary of Land Bank of the Philippines; UNObank of DigibankASIA Pte. Ltd.; and UnionDigital Bank of Union Bank of the Philippines, Inc.

Mr. Remolona said during an event last week that digital banks are an “experiment.”

“A digital bank has to do everything digitally… Digital banks manage deposits easier than granting loans. The assets side is harder for digital banks,” he said in mixed English and Filipino.

“Lending through digital means is hard. According to some of these banks, collecting or asking borrowers to repay their loans still needs to be done through a person or a firm. It can’t be done purely through online platforms,” Mr. Remolona added.

He said digital banks having a high nonperforming loan (NPL) ratio is okay for now as it means they are becoming increasingly capable of lending to their clients.

Based on latest BSP data, the over NPL ratio of digital banks stood at 8.46% as of September, significantly higher than the 3.4% NPL ratio of the whole Philippine banking system. 

The amount of NPLs recorded by the sector increased by 3.75% to P2.49 billion at end-September from P2.4 billion as of August.

Meanwhile, the total assets of the digital banking group stood at P82.29 billion in the first nine months of the year.

Last week, debt watcher Fitch Ratings said digital banks in the Philippines might be unable to compete against lenders with brick-and-mortar presence in the medium term, and their impact on the banking sector may be limited as the segment is still growing.

Fitch said the market share of system deposits of all digital banks was still less than 0.4% as of end-June despite their rapid growth in the past two years.

Low average deposits per customer also suggest that digital lenders have yet to capture most of their depositors’ operating accounts, Fitch said.

However, robust economic growth for the Philippines should provide some support to borrowers’ repayment capacity and asset quality in 2024-2025 for both digital and incumbent banks, it said. — Keisha B. Ta-asan

Sanremo Oasis launches 8th building

SANREMO OASIS part of City di Mare along South Road Properties in Cebu City. — BW FILE PHOTO

FILINVEST LAND Corp.’s Aspire recently launched the eighth building of its residential project Sanremo Oasis in Cebu City.

Sanremo Oasis, a mid-rise condominium, is part of City di Mare (CDM) along South Road Properties in Cebu City.

The Italian-inspired Sanremo Oasis has seven existing buildings consisting of 1,096 units.

“The eighth tower completes the residential cluster that currently takes up 3.4 hectares of CDM,” the company said in a statement.

Units at Sanremo Oasis range from studio units (22 square meters), one-bedroom units (28 sq.m.), and two-bedroom units (32 sq.m.).

It offers residents a resort-like lifestyle with amenities such as a swimming pool, pocket parks, fitness gym, basketball court, jogging trail, kids’ playroom, and a clubhouse. The eighth building will have a roof deck garden and retail strip.   

“Sanremo’s new residential tower at CDM addresses the increasing demand for residential options within South Road Properties which is rapidly becoming the next economic hub in the Queen City of the South as the local government continues developments within the district,” the company said.

South Road Properties is also a registered economic zone with the Philippine Economic Zone Authority.

Sharing prosperity with stockholders

FREEPIK

On Nov. 5, 2020, at the height of the COVID-19 pandemic, the Management Association of the Philippines (MAP), as lead organization, launched the Covenant for Shared Prosperity as the response of the business community to the poverty and inequality which continues to plague Philippine society even before and after the pandemic.

To quote the Covenant “We support the vision of the government articulated in ‘Ambisyon Natin 2040’ which states that the Philippines shall be a country where all citizens are free from hunger, have equal opportunities, enabled by a fair and just society that is governed with order and unity. A nation where families live together, thriving in vibrant, culturally diverse, and resilient communities.”

EDUCATE, EMPOWER, EQUIP, ENGAGE
The Shareholder’s Association of the Philippines (SharePHIL) was one of 26 organizations, together with MAP, which pledged and committed to six action points.

As an organization whose mission is to protect and promote the interest of minority shareholders and retail investors, SharePHIL envisions a nation where every Filipino enjoys a quality life and financial security supported by a fair, accessible, and sustainable capital market system. Indeed, this vision is aligned with the 6th action point in the Covenant: “deliver reasonable and just returns to and fair treatment of our controlling and non-controlling shareholders.” SharePHIL’s contribution in this respect is to provide investors with financial literacy and investor education programs, and be a steadfast advocate of investor rights through its four pillars namely: Educate, Equip, Empower, and Engage.

To implement these pillars, SharePHIL organizes seminars and conferences, publishes research and advocacy papers, participates in policy dialogues and consultations, and establishes partnerships and collaborations. Two key projects in the process of implementation are Project RISE: “Retail Investor and Shareholder Empowerment” which seeks to educate and empower the Filipino investor to develop the confidence and make well-informed decisions to take control of their future, and “Investor Relations Circle,” which seeks to professionalize the Investor Relations profession, given its significant role in bridging the communication between the investors, particularly the retail investors and the Publicly Listed Companies or PLCs.

MAP SUMMIT ON SHARED PROSPERITY
Fast forward to Nov. 28, 2023, three years since the launch of the Covenant, when MAP convened the Summit on Shared Prosperity to craft a Blueprint for Shared Prosperity which will contain a roadmap of how the commitments can be realized and implemented. SharePHIL, which I represented, provided the background for the discussion on shareholders with a suggested metric of a percentage dividend rate in compliance with regulations.

While current Securities and Exchange Commission (SEC) and Philippine Stock Exchange (PSE) regulations do not prescribe a dividend rate which PLCs should follow, the SEC monitors compliance with the regulatory requirements for dividend declarations in the Securities Regulation Code, ensuring that dividends are declared out of unrestricted retained earnings, and that this must not impair the corporation’s ability to meet its financial obligations. On the other hand, the PSE monitors PLCs’ compliance with the Consolidated Listing Disclosure Rules which prescribe, among others, the disclosure of dividend policy by listed companies.

For Government-Owned and -Controlled Corporations (GOCCs), under RA 7656 or the Dividend Law, such corporations are required to declare and remit at least 50% of their annual earnings as cash, stock, or property dividends to the National Government.

ROADMAP TO STOCKHOLDER PROSPERITY
How can we encourage companies to declare dividends that will deliver fair and reasonable returns to stockholders? Some suggestions that emerged from the discussions are the following:

• Enhance public participation by encouraging consultation, advocacy and sharing of views and opinions;

• Educate and empower shareholders to influence dividend policies, demand transparency and file complaints of irregularities;

• Develop strong mechanisms for investor relations to provide accurate and timely information that will increase and sustain stockholder confidence;

• Promote good governance by having more independent-minded boards who can steer companies to establish clear and transparent dividend policies;

• Benchmark dividend policies with industry averages and best practices, and incentivize companies with notable dividend policies through proper recognition, such as awards and citations;

• Review and reform tax laws on dividends to align with public interest, as appropriate.

The payment of dividends reflects positively on a company’s image and reputation, and helps maintain investor trust. Thus, a high dividend rate, for example, indicates that the company is performing well and has generated good profits. Paying dividends sends a powerful message about a company’s future prospects, and its willingness and ability to pay steady dividends over time provides a solid demonstration of financial strength. Companies may not realize that such payouts are a means to thank investors and incentivize them to continue holding their stocks.

Importantly, for the small stockholders, dividends matter as such distributions directly translates to income and return on their investments. Investments in stocks, which pay dividends, is a way to build wealth as part of a long-term investment strategy. Dividends contribute to overall portfolio risk and volatility, by mitigating the risk resulting from a price decline. In addition, dividends help preserve the purchasing power of capital due to the effect of inflation on investment returns.

Businesses that share their prosperity with their stockholders will help the Filipino investing communities build their wealth, and thus is a powerful tool to reduce the persistent inequality in society. We need not wait for 20 years to make this happen.

 

Ma. Aurora “Boots” D. Geotina-Garcia is vice-chair of the MAP Committee on Private-Public Partnership and a member of the MAP Committee on Diversity, Equity & Inclusion. She is chair of SharePHIL, and president of Mageo Consulting, Inc., a corporate finance advisory consulting firm.

map@map.org.ph

magg@mageo.net

Meralco’s solar unit expects 60-MW capacity by yearend

STOCK PHOTO | Image from Pixabay

MSPECTRUM, Inc., the solar energy arm of Manila Electric Co. (Meralco), is targeting its power generation capacity to reach 60 megawatts (MW) by the end of the year.

“We will be ending this year [with] 60 MW. Next year, another 30 MW, so it would be 90 [MW],” Ma. Cecilia M. Domingo, president and chief executive officer of MSpectrum, told reporters in a recent interview.

To date, about 80-85% of the company’s portfolio is under Meralco’s franchise area.

“[That’s] hoping, praying, and declaring, and maybe half a billion in revenues by the end of the year from last year’s P300 million,” said Ms. Domingo, who is also a vice-president at Meralco,

The company is open to opportunities to install rooftop solar panels, she said, describing possible clients as “all those with roofs, rooftops that can be installed [with solar panels], new buildings that are ready for solar.”

“We’re expanding our footprint in the Visayas and Mindanao. That’s been our target since last year. They are included in the 30-MW target next year — commercial and industrial,” she said.

In April, the company installed a 976.8-kilowatt-peak solar panel system in the cold storage facility of Atkins Import and Export Resources, Inc. in Naic, Cavite.

Atkins, a subsidiary of First Atkins Holdings Corp., is primarily engaged in the importation and distribution of meat products mainly sourced from Europe.

MSpectrum provides tailor-fit solutions for industrial, commercial, and residential customers through an in-depth understanding of energy consumption behavior. It is backed by Meralco’s energy expertise and proven safety track record.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera

Testing love and fate in Hong Kong Star Cinema presents short film Toss Coin

A scene from Toss Coin. 

THREE short films featuring the iconic cosmopolitan scenery of Hong Kong make up “Hong Kong In The Lens By Asian Directors,” a project produced by CJ ENM and the Hong Kong Tourism Board (HKTB).

These films are Toss Coin, a Star Cinema-produced rom-com from the Philippines; Hong Kong, Within Me, a romantic fantasy from South Korea; and Zi Mui, a family drama from Thailand.

“HKTB never dictated what to do. They guided us based on our genres what areas of Hong Kong to shoot in, so that our three films wouldn’t all show the same places,” said Cathy Garcia-Sampana, who directed Toss Coin, at its special screening on Dec. 10.

This was familiar territory for Ms. Garcia-Sampana who shot her 2019 film Hello Love, Goodbye entirely in Hong Kong, making this the second time she would showcase the country’s culture in her work.

Toss Coin marks many firsts, however. It is her first short film following a long career of directing full-length Filipino rom-coms. It was also her first time working with the two leads, Alexa llacad and KD Estrada, a Gen Z love team known as KDLex.

Ms. Ilacad and Mr. Estrada play strangers who fall in love as they test their beliefs in fate and their courage to take chances. The film showcases a variety of buildings and art spaces as the two sort of play hide and seek with each other as they traverse Hong Kong.

“HKTB and CJ ENM toured us around and made me choose. When I saw the murals in Sai Kung, I decided we’d shoot there,” said Ms. Garcia-Sampana.

Other cultural points of interest shown in the film are M+ in the West Kowloon Cultural District, the Hong Kong Museum of Art, and the hip PMQ mall in Central.

Meanwhile, the other two films in the project showcase differing sides of the city. Korean director Kang Yunsung captures Victoria Harbour from various bayside restaurants as the leads of Hong Kong, Within Me make local delicacies. Thai director Nattawut Poonpiriya portrays Hong Kong at night as the two sisters in Zi Mui go bar hopping in Central and the Western District.

For Ms. Garcia-Sampana, it was a very memorable project to be a part of. “[HKTB] were very generous with giving us the freedom to make our own stories,” she said.

All three films will air on tvNAsia this month and on Viu starting Dec. 11, with Philippine premieres on A2Z and Kapamilya Channel to be announced. — Brontë H. Lacsamana

Loans used as reserves hit P8 billion

BW FILE PHOTO

SMALL BANKS lent out P8.01 billion to micro, small, and medium enterprises (MSMEs) and eligible large enterprises (LEs) as part of their alternative compliance with reserve requirements, the Bangko Sentral ng Pilipinas (BSP) said. 

“For the reserve week ending Oct. 19, TBs (thrift banks) and RCBs (rural and cooperative banks) allocated an aggregate of P8 billion and P6.5 million loans to MSMEs and LEs, respectively, for compliance with the reserve requirements,” it said in a report on recent trends in the Philippine financial system.

The central bank said these accounted for 0.6% and 0.0005% of the total required reserves for the said week. 

The BSP allowed MSMEs loans to be counted as part of banks’ reserve requirements in a bid to boost lending to the sector, which was hit severely by the coronavirus pandemic.

According to the BSP, banks’ availment of the relief measure declined in October this year due to the expiration of its effectivity for universal and commercial banks on June 30.

Smaller lenders can still count their loans to MSMEs and LEs as alternative compliance with reserve requirements until they are fully paid, but not later than Dec. 31, 2025.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said MSME and LE loans counted as reserve requirements would allow smaller banks to earn more from their loanable funds.

“Given the extension of these regulatory relief requirements for smaller banks, so might as well maximize the returns through these additional MSME and LE loans used as alternative compliance by including the calculation of required reserves while still allowed,” Mr. Ricafort said.

In 2022, banks lent P493.5 billion to MSMEs as alternative compliance with reserve requirements. This was 6.6% higher than the P463.1 billion a year prior.

By banking group, universal and commercial banks extended P390.9 billion in loans to MSMEs, while rural and cooperative banks lent P52.7 billion.

In June, the BSP cut the reserve requirement ratios of big banks by 250 basis points (bps) to 9.5%, by 200 bps to 6% for digital banks, and by 100 bps for thrift banks, and rural and cooperative banks to 2% and 1%, respectively. — Keisha B. Ta-asan

Ube Express back at Robinsons Galleria

UBE EXPRESS has resumed its point-to-point bus service to the Ninoy Aquino International Airport (NAIA) terminals from Robinsons Galleria.

The Ube Express service gives travelers a convenient, and accessible way to go to the airport.

The UBE Express terminal is located along Robinsons Galleria EDSA driveway. Each bus can accommodate up to 39 passengers and their luggage.

The bus leaves Robinsons Galleria for NAIA Terminal 1,2, 3 or 4 starting at 7 a.m. The bus departs NAIA Terminal 3 to Robinsons Galleria as early as 5:45 a.m.

The P150 fare can be paid through cash or Beep Card.

UBE Express also operates its point-to-point airport services in Robinsons Manila and Robinsons Sta. Rosa Laguna.

Robinsons Manila terminal is located along Midtown driveway beside Arya, while Robinsons Sta. Rosa Laguna terminal is located at the bus bay in front of the mall.

Follow Robinsons Malls Official, Robinsons Galleria and Robinsons Manila social media pages for more information and updates on Ube Express services and dispatch schedules.

Ready for it? Taylor Swift ruled pop culture in 2023. She will dominate again in 2024

TAYLOR SWIFT in the concert film Taylor Swift: The Eras Tour.

LOS ANGELES — Pop superstar Taylor Swift rocked concert stages, cinemas, local economies — and even the Earth — in 2023.

Ms. Swift’s Eras Tour sold out stadiums and pumped millions of dollars into each city it visited. A movie version of the show lit up theaters, racking up $250 million in ticket sales.

With 26 billion streams, Ms. Swift ranked as Spotify’s most popular artist of the year. In July, the 33-year-old became the first female artist to have four albums on Billboard’s top 10 list at the same time.

“She keeps leveling up,” said Colin Stutz, news director at Billboard. He ranked Ms. Swift’s achievements alongside musical elites such as The Beatles, Elvis Presley, and Michael Jackson.

If Ms. Swift were a record label, Mr. Stutz said, the “Anti-Hero” singer would stand as the fourth largest in the US by revenue from her touring, merchandise, streams and other sources.

Time magazine named Ms. Swift its 2023 “ “Person of the Year.”

“This is the proudest and happiest I’ve ever felt, and the most creatively fulfilled and free I’ve ever been,” Ms. Swift told the magazine.

In 2023, the singer released re-recordings of two records — Speak Now and 1989 — as part of her effort to take control of her back catalog.

A Swift concert in Seattle caused a small earthquake. Thousands of dancing fans set off a nearby seismometer, registering the equivalent of a magnitude 2.3 quake.

For 2024, the “Swift Effect” will spread around the world as her tour hits Asia, Australia, Europe and Canada.

WHY IT MATTERS
Ms. Swift did not just rule the music business. She lifted local economies, encouraged voter registrations, and brought more viewers to professional football.

The Eras Tour grossed more than $900 million in ticket sales, Billboard estimates. The media outlet projects that will nearly double by the end of 2024 and surpass Elton John’s Farewell Yellow Brick Road Tour as the highest-grossing tour in history. Each stop by Ms. Swift brought an influx of Swifties who spent money on hotels, meals, and more. Celebrities and moms and dads also joined their superfan children for one of the hottest tickets of the year.

While it is hard to reliably estimate Ms. Swift’s economic impact, it was notable enough for the Federal Reserve Bank of Philadelphia to cite a three-night Eras run as a driver of tourist traffic.

One contact told Fed researchers that May was “the strongest month for hotel revenue in Philadelphia since the onset of the pandemic, in large part due to an influx of guests for the Taylor Swift concerts,” a July report said. 

Two shows in Denver injected $140 million into Colorado, local authorities estimate. Six nights near Los Angeles added $320 million and 3,300 jobs to the area, according to the California Center for Jobs and the Economy.

Ms. Swift’s impact had local politicians embracing her.

“Mayor after mayor would rename their city for a day,” said Arizona State University Professor Margaretha Bentley. Glendale, Arizona, for example, temporarily became Swift City.

Bentley is teaching a class next year called “Taylor Swift (Public Policy Version).” It will explore government through the lens of Ms. Swift, looking at topics such as her impact on voter registration. After Ms. Swift urged fans to register, Vote.org reported 35,000 signups. Harvard, Stanford and other colleges also offer courses on Ms. Swift’s songwriting and influence.

In sports, Ms. Swift’s high-profile romance with Kansas City Chiefs star Travis Kelce brought new viewers to football games. Sales of Kelce jerseys jumped 400% in one day, online seller Fanatics said.

WHAT IT MEANS FOR 2O24
While Ms. Swift was seemingly everywhere in 2023, her Eras Tour only spanned the US, Mexico, Brazil, and Argentina. In February, it heads to Tokyo before swinging through Australia, Singapore, and Europe. It wraps in Vancouver in December 2024.

Ms. Swift may be seen at February’s Grammys, where her record Midnights will contend for album of the year.

The superstar also may release another re-recording, or two in the coming year, Mr. Stutz said. A prolific songwriter, Ms. Swift could debut new material.

“To have this level of popularity sustained, and continue to grow, is pretty remarkable,” Mr. Stutz said. “It will be interesting to see how long she’s able to keep that success and what it looks like as she grows and matures.” — Reuters

Stabilizing growth with low inflation, low unemployment rates, and more PPP investments

(Part 4)

There were three positive economic developments last week.

First, the Philippine Statistics Authority (PSA) reported that November’s inflation rate was a low 4.1%. This was down from 4.9% in October and 8% in November 2022, or just half of the level a year ago.

Second, the PSA also reported that the unemployment rate in October was a low 4.5%. This is very significant because it is the lowest unemployment rate the country has seen since April 2005. See these reports in BusinessWorld: “Inflation cools to 4.1% in November” (Dec. 6), and, “Unemployment rate drops to 18-year low in October” (Dec. 8).

I have consolidated and summarized the monthly inflation data plus comparable months’ unemployment data of other countries in an accompanying table. Group A is composed of the G7 industrial countries, Group B is made up of the big South Asian economies, and Group C contains the big East Asian economies. The Philippines has the highest inflation rate this year among its neighbors in East Asia and is comparable to those in Italy and Germany (see the table).

Budget Secretary Amenah Pangandaman has correctly observed that “Fiscal consolidation is bearing fruit, the high GDP growth of 5.6% average for Q1-Q3 of 2023 is creating more jobs, the January-October average unemployment rate of 4.6% is lower than the 5.3% to 6.4% target for 2023 in the Philippine Development Plan. Our public spending especially in hard and soft infrastructure is helping expand labor productivity of our people and business dynamism.”

The third piece of good news last week was the signing into law by President Ferdinand Marcos, Jr. of the Public-Private Partnership (PPP) Code of the Philippines (RA 11966) on Dec. 5.

The new PPP Code will do many things: 1.) it will establish a stable, predictable business and financing environment for public and private collaboration; 2.) it will consolidate all legal frameworks and clarify ambiguities in the existing Build-Operate-Transfer (BOT) Law which was last amended in 1994; 3.) it will streamline project implementation process and update approval thresholds for national PPP projects; 4.) it will improve the framework for unsolicited proposals and it establishes a predictable tariff regime to protect public interest; 5.) it will promote autonomy in implementing local PPP projects; and, 6.) it will institutionalize the PPP Governing Board, Project Development and Monitoring Facility, and the new Risk Management Fund, among others.

The Marcos Jr. administration has identified 197 infrastructure flagship projects (IFPs) with combined investments of P8.7 trillion; 41 of these 197 IFPs will be financed through PPPs.

National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan, as head of the PPP Governing Board, will issue the Implementing Rules and Regulations (IRR) within 90 calendar days from the law’s effectivity.

PPP Center Executive Director Cynthia Hernandez had an optimistic view and said that: “The PPP Code of the Philippines is a landmark [piece of] legislation that will prioritize job creation through the promotion of trade and investments, improve infrastructure, encourage more financially viable, well-structured and high-quality PPP projects to be delivered to Filipinos. The PPP Center looks forward to shepherding the stakeholder consultation process that shall be conducted to prepare the IRR of the new law. We want to make ensure a smooth transition period and to continue the progress that has already been achieved.”

Congratulations to the economic team plus the PPP Center leadership.

Back to Philippines inflation.

The top three sources of inflation from January to November were Food and non-alcoholic beverages (8.1%), Alcoholic beverages and tobacco (10.9%), and Restaurants and Accommodation Services (7.6%). Double-digit inflation continues for rice, fruits, and vegetables.

Among the reasons for this that I see is the slow but steady incursion and conversion of agricultural land into solar farms, on top of their conversion into residential and commercial land use. The average rice yield in the Philippines is about 3.5 tons/hectare, and with two harvests per year (three harvests for well-irrigated lands but this is not big) means seven tons/hectare/year.

Solar farms require about 1.5 hectare per 1 MW solar capacity. So, a 500-MW solar farm will require about 750 hectares of land, including roads, fences, etc. If that 500-MW solar farm was previously a rice field, then it has permanently displaced or deprived the country of 5,250 tons/year of rice (7 tons/hectare/year x 750 hectares). That is not good.

There are thousands of MW of solar capacity coming on stream in the next few years. Most are inland and some are floating solar in lakes and dams. Big solar farms on lakes will keep sunlight from penetrating the lake water and thus affect the food chain, and this can lead to reduced harvest of inland fishery.

While I am hopeful that more PPP investments, more productivity-enhancing infrastructure projects, more fiscal consolidation, more trade and economic liberalization will help stabilize food and consumer prices in the long term, I am less optimistic that this can be achieved when more agriculture and forestry land are converted to expand solar and wind farms to “save the planet.”

As a developing country with a big population, we should prioritize more food production, more price stabilization, more growth and job creation over hazy climate and ecology goals. We are lucky that El Niño 2023, that started last April, has not led to the feared “more drought, more warming.”

The previous articles in the “Stabilizing growth” series are, Part 1, “Stabilizing growth: Declining inflation and unemployment rates” (Nov. 9); Part 2, “Stabilizing growth of the fastest growing major economy in the world” (Nov. 14); and, Part 3, “Stabilizing growth via peace and order and free trade” (Dec. 5).

 

Bienvenido S. Oplas, Jr. is the president of Bienvenido S. Oplas, Jr. Research Consultancy Services, and Minimal Government Thinkers.

minimalgovernment@gmail.com

Alternergy unit receives award for two wind energy projects

ALTERNERGY Holdings Corp.’s subsidiary has received the certificates of award for two wind power projects that it won under the second round of the green energy auction program of the Energy department.

In a media release on Monday, Alternergy President Gerry P. Magbanua described the confirmation by the Department of Energy and subsequently, the issuance of the certificates as “a critical milestone.”

These actions formally award the wind projects with 20-year off-take agreements with state-led National Transmission Corp. with a specific tariff.

He added that the award “is critical to our project lenders who are close to completing their due diligence with target financial closure by first quarter of next year.” 

The government’s green energy auction or GEA program is a competitive process of procuring renewable energy supply by offering capacities to qualified bidders at a set maximum or ceiling price.

According to its parent firm, Alternergy Tanay Wind Corp. (ATWC) has conducted competitive bidding for the equipment supply and construction contracts.

The company is targeting to complete the 86-megawatt (MW) Tanay wind farm in Rizal and the 55-MW Alabat wind farm in Quezon province by the second quarter of 2024.

Last week, ATWC said it had tapped K2 Management A/S, an independent wind and solar project management consultancy firm, as the “owner’s engineer” of the two projects.

It will support Altenergy in the procurement processes within a multi-contracting framework, followed by construction management, design reviews, site management, and quality control measures.

Alternergy aims to develop up to 1,370 MW of renewable energy sources such as onshore and offshore wind, solar, and run-of-river hydropower.

At the local bourse on Monday, shares of the company went down by two centavos or 2.67% to close at P0.73 apiece. — Sheldeen Joy Talavera

Scam activity involving credit card transactions to increase amid holidays

FREEPIK

SCAMMERS are expected to target both card and non-card transactions during the holiday season, with fraud activity seen growing until January, a study by Visa showed.

“Crooks prepare all year for the holiday shopping season, taking advantage of increased activity and consumers who let their guard down searching for the perfect gift,” Visa Country manager for the Philippines Jeffrey V. Navarro said in a statement on Monday.

Visa’s Holiday Edition Threats Report showed scam activity for card and non-card transactions are likely to rise between November 2023 and January 2024 amid an expected increase in both e-commerce and in-person shopping amid the holiday season.

In 2022, holiday fraud rates rose by 11% compared with the non-holiday fraud rate, Visa said.

Scams also rose by 8% during the holidays last year versus the same period in 2021.

Visa expects scammers to target account data from online merchants through digital skimming.

Developing technology, especially artificial intelligence (AI), allows threat actors to create customized phishing campaigns, making it harder for consumers to spot fakes, it said.

“Fraudsters also create phishing websites, often using malvertising (malicious advertising) and other illicit search engine optimization (SEO) tactics on retail or service websites to entice victims,” Visa said.

It urged cardholders to be careful when using automated teller machines or point of sale terminals as scammers are expected to target these. Scammers could also use fake one-time password templates to gain access to accounts.

Consumers should keep their belongings close when outside to keep their cards or phones, which contain their financial information, from being stolen, Visa added.

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