Home Blog Page 2929

Meta to start fully encrypting messages on Facebook and Messenger

SYIFA5610/FREEPIK

Meta Platforms said on Wednesday it has started to roll out end-to-end encryption for all personal chats and calls on Messenger and Facebook.

The end-to-end encryption feature will be available for use immediately, the social media giant said, but it may take some time for all Messenger accounts to be updated with default end-to-end encryption.

Messenger previously had the option to turn on end-to-end encryption, allowing a message to be read only by the sender and its recipients, but with this change messages would be encrypted by default, Meta said.

Meta, whose WhatsApp platform already encrypts messages, has said encryption can help keep users safe from hackers, fraudsters and criminals.

End-to-end encryption has been a bone of contention between companies and governments. 

The British government had urged Meta in September not to roll out encryption on Instagram and Facebook Messenger without safety measures to protect children from sexual abuse. — Reuters

Russian co-founder of crypto exchange Bitzlato pleads guilty in US

NEW YORK — The co-founder of Hong Kong-registered virtual currency exchange Bitzlato, a Russian national who United States authorities have accused of processing about $700 million in illicit funds, pleaded guilty to a criminal charge on Wednesday and agreed to forfeit $23 million in a deal with federal prospectors.

Anatoly Legkodymov, Bitzlato’s majority owner and co-founder, entered the guilty plea to one count of operating a money-transmitting business that transported and transmitted illicit funds at a hearing before U.S. District Judge Eric Vitaliano in Brooklyn.

Legkodymov, who according to U.S. officials ran Bitzlato from the Chinese city of Shenzhen, said in court that he became aware that some of Bitzlato’s clients had used the platform to transfer cryptocurrency derived from illicit activity.

He acknowledged that ransomware proceeds from Hydra Market, which prosecutors described as an online marketplace used for drugs, stolen financial information and money laundering services, made their way onto the Bitzlato platform. U.S. and German law enforcement shut down Hydra Market in April 2022.

“He was well aware that Bitzlato, his cryptocurrency exchange, was being used like an open turnstile by criminals,” Breon Peace, the top federal prosecutor in Brooklyn, said in a statement.

Bitzlato’s website has been replaced by a notice saying the service has been seized by French authorities as part of a coordinated international law enforcement action.

Legkodymov, 41, faces up to five years in prison when the judge sentences him. No sentencing date was set. Legkodymov was arrested in Miami on Jan. 17 and held at the Metropolitan Detention Center in Brooklyn since then.

His guilty plea represented the latest victory in U.S. law enforcement’s crackdown on fraud and illicit finance in the cryptocurrency markets.

Last month, FTX founder Sam Bankman-Fried was convicted on charges of stealing billions of dollars from that cryptocurrency exchange’s customers, while rival Binance agreed to pay a $4.3 billion settlement and CEO Changpeng Zhao pleaded guilty to breaking U.S. anti-money laundering laws.

Binance was among Bitzlato’s top counterparties, according to U.S. authorities.

Russia’s embassy in Washington called for Legkodymov’s release in April after Ambassador Anatoly Antonov visited him in jail. Hours earlier, Russia had denied a U.S. embassy request to visit detained Wall Street Journal reporter Evan Gershkovich.

A U.S. State Department spokesman said on Tuesday that Russia in recent weeks rejected a proposal for the release of Gershkovich and Paul Whelan, two Americans considered by the U.S. to be wrongfully detained in Russia. — Reuters

Chinese e-commerce platform Temu drawing shoppers from US dollar stores -data

FREEPIK

NEW YORK — Temu, the fast-growing Chinese e-commerce platform selling $4 home decor and $10 shirts, is successfully taking on US dollar stores including industry leader Dollar General, according to the latest market share data.

As of last month, Temu accounted for nearly 17% of market share in the United States within the discount stores categories, according to data analytics firm Earnest Analytics. That compares to 8% for the dollar chain Five Below, 43% for Dollar General and 28% for Dollar Tree.

Temu launched in the United States in September 2022 and quickly became popular through its use of social-media influencers to tout its merchandise as better and more affordable than traditional stores.

“Its (Temu) low prices on household goods and consumer staples makes it more of a threat to brick-and-mortar discounters like the dollar stores than other online marketplaces,” said Michael Maloof, head of marketing at Earnest Analytics.

Temu sells apparel including $12 dresses and $20 sneakers, while also offering similar holiday decor, storage containers and toys as dollar stores. Analysts expect it to generate more than $16 billion in revenue this year as it expands internationally.

“Temu has the advantage of novelty and excitement that is hard to re-create for staid low-end discount retail brands,” said Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors.

Temu, Dollar General, Dollar Tree and Five Below did not respond to requests for comments on the research. The U.S. dollar stores have said previously they do not see an effect from Temu on their sales because of relatively smaller online presences and differing customers.

While dollar stores have maintained strength among customers buying necessities like food, beverages and items like detergent, they are dealing with a shift in consumer demand and also struggling with operational missteps.

Dollar General has cut its annual profit forecast three times this year as budget-conscious shoppers have cut spending on higher-margin discretionary goods and shifted to buying more lower-margin consumable goods.

Margins have also fallen at dollar stores because they are marking down merchandise to clear excess inventory and like many retailers are also being hurt by retail theft.

Tennessee-based Dollar General has seen the steepest decline in market share compared to competitors, according to Earnest Analytics. It held a 43% market share in November, down from about 57% in January. 

Dollar Tree’s share slid nearly four percentage points from 32% in January to 28% in November.

Temu is benefiting from shopper fatigue with high prices and inflation, said Peter Earle, an economist at the American Institute for Economic Research, a libertarian, free-market think tank. Temu’s parent company PDD Group said revenue rose by 94% to 68.84 billion yuan ($9.62 billion) in the quarter ended Sept. 30 from a year ago.

Temu uses a network of China-based manufacturers of cheap personal electronics, clothes and home goods. Factories and merchants on Temu send merchandise directly to Temu shoppers, using a trade exemption that allows shipments under $800 to enter the U.S. duty-free.

“Temu with their ‘shop like a billionaire’ slogan has mastered gamification and rewards to make online shopping fun, easy, and cheaper than the dollar stores,” Running Point’s Schulman said. — Reuters

US House Republicans seek to halt Biden EV regulations

MICHAEL FOUSERT-UNSPLASH

WASHINGTON — The Republican-led House of Representatives voted on Wednesday to bar the Biden administration from moving forward with stringent vehicle emissions regulations that would result in 67% of new vehicles being electric by 2032.

“While EVs may play a large role in the future of the auto industry, Washington should not discount other technologies like hydrogen, hybrids, and the internal combustion engine,” said Republican Tim Walberg, a sponsor of the legislation.

The 221 to 197 vote, which included five Democrats joining 216 Republicans, drew a veto threat from the White House, which said it would “catastrophically impair” the U.S. Environmental Protection Agency’s (EPA) ability to issue automotive regulations.

Former President Donald Trump, who is seeking to return to the White House, has vowed to reverse the Biden administration’s electric vehicle rules.

The EPA said in April the proposed 2027 to 2032 standards would cut emissions by 56% compared to the existing 2026 requirements, or 13% annual average pollution cuts.

The agency projects the rules would cut more than 9 billion tons of carbon dioxide emissions through 2055 – equivalent to more than twice total U.S. CO2 emissions last year. Final rules are expected early next year.

Automakers, auto dealers and the United Auto Workers (UAW) union have called on the Biden administration to finalize a less stringent proposal.

The UAW, which represents workers at General Motors, Ford Motor and Chrysler parent Stellantis, said in July the EPA proposal should “better reflect the feasibility of compliance so that the projected adoption of (zero emission vehicles) is set to feasible levels, increases stringency more gradually, and occurs over a greater period of time.”

A group representing major automakers has called for significantly softening requirements, saying the EPA proposal was “neither reasonable nor achievable.”

Toyota Motor has called the EPA proposal stringency requirements “extreme and outside historical norms.”

The auto trade group called the proposal a “de facto battery electric vehicle mandate.”

Representative Frank Pallone, the top Democrat on the Energy and Commerce Committee, said Wednesday Republicans were trying to “legislate away years of innovation in cleaner transportation to put polluters over people.” — Reuters

AIA Philippines introduces new fund to unlock growth potential of savings

Even with the pandemic behind us, much of the uncertainty remains for most Filipinos. Because of this, more and more are saving up for the long run. According to the AIA Household Savings Behaviour Study conducted in 2021, 72 percent of Filipinos claim that their primary motivation for saving up is to manage uncertainty or prepare for emergency spending. Meanwhile, 65 percent said they want to guarantee financial security for themselves and their family members in case of untoward life events. As such, a lot are on the lookout for opportunities to maximize the growth potential of their savings.

AIA Philippines, one of the leading life insurance companies in the Philippines, recently introduced AIA Global Dynamic Income-Paying Fund, which is designed to help grow savings while they are protected, and at the same time receive additional financial benefits from the investment right away. Customers can stay invested while receiving potential quarterly dividend pay-outs, ensuring long-term savings growth opportunity is sustained. The dividend pay-out will not be treated as a withdrawal from the policy’s account value, making this an additional benefit that customers can enjoy.

The AIA Global Dynamic Income-Paying Fund is ideal for investors looking to maximize the growth potential of their savings with the possibility of additional income. It will be managed by experts from AIAIM Singapore, with years of experience handling over US$244 billion across different asset classes.

“AIA Global Dynamic Income-Paying Fund will open the door of opportunity to adventurous Filipino investors who are unafraid to take a risk and expand their investment portfolio for bigger rewards, bringing them a step closer to achieving their financial goals,” said Tennyson Paras, Head of Products of AIA Philippines. “At AIA Philippines, we are always on the lookout for innovative long-term savings solutions that will benefit our customers. This, combined with protection, allows us to be in a better position to help them live healthier, longer, better lives.”

Investing into the fund is available through AIA Philippines’ single-pay product Peso Money Tree Income-Paying which provides 125 percent of face amount for a minimum premium of P125,000.

Talk to an AIA Philippines financial advisor or click here to know more about AIA Global Dynamic Income-Paying Fund.

 


Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by enabling them to publish their stories directly on the BusinessWorld website. For more information, send an email to online@bworldonline.com.

Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.

Maharlika investment fund CEO aims to double war chest in two years

The Philippines’ first-ever sovereign wealth fund will seek to double its investible capital to P250 billion ($4.5 billion) in two years to bankroll local infrastructure projects and help spur the economy, according to its top official.

Maharlika Investment Corp., the company that will manage the fund, plans to start inviting domestic and foreign investors in the coming year to build its war chest from the 125 billion pesos pledged by the Philippine government and state-owned lenders, President and Chief Executive Officer Joel Consing told reporters on Wednesday.

“The vision for this fund is to have it invest in the Philippines in the first five to seven years through four key pillars that will help sustain economic growth,” Mr. Consing said, citing energy security, tourism and digital infrastructure and agro-forestry industrial urbanism. All of Mr. Consing’s plans for Maharlika are subject to the approval of the board whose members are expected to be named this month, he said.

“Once the fund matures we can consider strategically investing in the global markets,” said Mr. Consing, a former executive at International Container Terminal Services Inc. and HSBC Holdings Plc.

Maharlika is planning an investor roadshow in 2024 and will also tap the Bureau of the Treasury to oversee its idle funds, Mr. Consing said, mindful of concerns after Malaysia’s state fund 1MDB became the center of a multi-billion-dollar scandal. — Bloomberg

EO on lower agri tariffs up for approval

PHILIPPINE STAR/WALTER BOLLOZOS

THE National Economic and Development Authority (NEDA) has endorsed an executive order (EO) that would extend the temporary reduction of tariff rates on rice, pork, corn, and coal until Dec. 31, 2024, to help further bring down inflation. 

“(The EO) will go to the NEDA Board next week. The Committee on Tariff and Related Matters (CTRM) endorsed it… to extend it for one year,” NEDA Secretary Arsenio M. Balisacan said on Wednesday. 

If approved, the EO would extend by one year the implementation of lower tariff rates on rice, pork, corn, and coal.

In December 2022, President Ferdinand R. Marcos, Jr. signed EO 10, which had extended the lower tariff rates on key commodities to address rising prices. EO 10 is set to expire on Dec. 31, 2023.

Tariff rates for imports of swine meat were kept at 15% for shipments within the minimum access volume (MAV) quota and 25% for those exceeding the quota. The corresponding rates for corn remained at 5% (within the MAV quota) and 15% (exceeding the MAV quota), and rice at 35% in both cases.

The EO also kept the zero-import duty for coal.

Mr. Balisacan said it is important to sustain the slowdown in inflation and ensure that inflation goes down to within the 2-4% government target range.

“Inflation continues to fall, now down to 4.1% in November 2023, bringing us closer to our target band of 2-4% and nearer to our peers in Southeast Asia,” Mr. Balisacan said in an event hosted by the European Chamber of Commerce of the Philippines.   

Headline consumer price index (CPI) fell to 4.1% in November from 4.9% in October and 8% in November 2022. It marked the slowest in 20 months or since the 4% seen in March 2022.

In the eleven months to November, inflation averaged 6.2%, faster than 5.6% in the same period a year ago. This is still above the central bank’s full-year baseline forecast of 6%.

“Still, we remain committed to bringing inflation down further through interagency efforts to address its root causes in the market without relying on the monetary response or cure from our central bank,” Mr. Balisacan said. 

Last month, the Bangko Sentral ng Pilipinas (BSP) kept its benchmark interest rate at a 16-year high of 6.5%. The BSP raised borrowing costs by a total of 450 basis points (bps) from May 2022 to October 2023 to tame inflation.

Meanwhile, analysts said headline inflation may further decelerate in December to within the BSP’s 2-4% target.

“After 20 months staying above BSP’s target range of 2-4%, we expect headline inflation in December 2023 to be within the target range,” Maybank Investment Banking Group said in a note.   

The bank sees Philippine inflation averaging at 6% this year, before easing to 3.5% in 2024.

“The recent trend in headline and core inflation enhanced our view that BSP will keep interest rate at 6.5% during the last monetary policy meeting for the year, scheduled on Dec. 14,” Maybank said. 

BSP Governor Eli M. Remolona, Jr. earlier said the Monetary Board intends to keep rates tighter for longer until the downtrend in inflation has become more evident. 

He also said rate cuts are not on the table this year, as inflation may still pick up in the second quarter of next year.

Pantheon Macroeconomics said headline inflation may hit 4% this month, barring any unforeseen supply shocks, as base effects will remain favorable until January. 

“We’re sticking to our forecast for a big slowdown in average inflation next year to 2.8% from 6% this year,” it said in a note.

However, Maybank noted there are still upside risks to the inflation outlook such as the El Niño weather event, which may cripple agricultural production and supply, and higher minimum wage adjustments.

Broader geopolitical tensions in the Middle East and further production cuts in global oil output next year may also risk domestic transport inflation to pick up again, it added. 

‘MOST EXPOSED’
In Asia, the Philippines is the most vulnerable to spikes in food and oil prices, Nomura Global Markets Research said in a report.

“Within Asia, the Philippines is the most exposed, as food and energy account for 43.9% of its CPI basket (rice alone has an 8.9% weighting), and the absence of fuel subsidies implies a direct pass-through to consumers,” Nomura said. 

It also said that in every 10% increase in oil prices, there would be a 0.4-percentage-point rise in headline inflation.

“Fiscal policy and supply-side interventions will likely be the first lines of defense. The role of monetary policy is limited in the face of supply-driven pressures but could be activated if second-round effects materialize,” Nomura said. 

“This is especially true in the Philippines, where BSP follows its inflation mandate more strictly,” it added. — Keisha B. Ta-asan

Weak basic education threatens PHL economic growth, future workforce

Grade 7 students listen to their teacher during class at a school in Malabon City, Sept. 25, 2023. — PHILIPPINE STAR/MIGUEL DE GUZMAN

By Kyle Aristophere T. Atienza, Reporter

THE PHILIPPINES’ weak basic education system as shown in a 2022 global ranking of student performance in math, reading, and science would eventually lead to a weak workforce and affect economic growth and global competitiveness, according to an advocacy group founded by the country’s top business leaders.

“The weaknesses in our basic education system will eventually translate into the weakness of our workforce, affecting the productivity and key source of our economic growth and competitiveness,” the Philippine Business for Education (PBED) said in a statement following the country’s poor showing in the 2022 Program for International Student Assessment (PISA), which the higher and basic education agencies plan to address by improving teacher training, among others.

Filipino students were still among the world’s weakest in math, reading, and science, according to the global assessment, with the country ranking 77th out of 81 countries and performing worse than the global average in all categories.

OECD: Filipino students still struggle in math, reading, and science

The assessment is annually conducted by the Organization for Economic Cooperation and Development (OECD) for 15-year-old learners.

OECD said the Philippines’ average in last year’s assessment for 15-year-old learners was nearly the “same” as the results it got in 2018, when Manila ranked lowest in the three subjects among 79 participating countries at the time.

PBED said the poor performance in the PISA for the second time indicates that the Philippine education system is in its “worst state” and that “much work needs to be done.”

“The poor performance of our learners is not just a problem of education alone, but our country as a whole,” it said. “A crisis of this magnitude requires swift action and great effort from all sectors.”

PBED urged its partners in industry, government, and academe to take action by being involved in the ongoing work of the Second Congressional Commission on Education, which is tasked with crafting a comprehensive national assessment and evaluation of Philippine education.

We welcome our continuous participation in large-scale international learning assessments as this provides us measurement of the impact of the pandemic on learning,” it said, calling for data-driven decisions in education governance.

Meanwhile, the Commission on Higher Education (CHED) said it is considering phasing out teacher education programs in poor-performing teaching education institutions (TEIs).

“The Commission has created a Technical Working Group and developed guidelines for the monitoring and evaluation process that will lead to the phasing out of teacher education degree programs in poor-performing TEIs in order to address teacher quality issues that ultimately influence learning outcomes,” it said in a statement following the release of the PISA results.

The CHED said it plans to engage Centers of Development and Centers of Excellence in teacher education, as well as expand a technical panel for teacher education to include Department of Education (DepEd) curriculum development and learner assessment specialists.

In the 2022 PISA, the average mathematics score for 15-year-old Filipino students was 355 points, way lower than the global average of 472 points and higher by just two points from the national average in 2018.

The Philippines’ average score for science in 2022 dropped by only one point to 356 from 357, placing the country third to last globally in mean science performance among its peers.

Its literacy score increased to 347 points from 340 points — the country’s best performance last year — but it was still way lower than the global average reading score of 476 points.

Test scores need to hit at least a 20-point improvement to address learning losses of at least a year’s worth of schooling, according to the OECD, which does not consider one to two-point changes significant.

Ahead of the 2022 PISA results, the DepEd said it was “not expecting to see high scores.”

Vice-President and Education Secretary Sara Duterte-Carpio on Wednesday said the PISA results “are not merely a reflection of our education system” but also of the country’s “collective efforts, investments, and most importantly our commitment to education and the future we envision for our children.”

“As such, this is a call to action, a call to our collective responsibility as a nation,” she said in a video statement during a PISA conference, where she heavily touted the education agency’s programs to address the learning challenges in the Philippines, which was among the last countries to reopen schools following a coronavirus pandemic.

She touted the “Matatag Curriculum,” which revised the K-to-10 program to put focus on literacy and math skills, as well as other programs such as the “Catch-up Fridays” and the national reading, science, and mathematics program.

ACT Teachers Party-list Rep. France L. Castro called on the government to increase the education budget to at least 6% of the Philippine gross domestic product “with a thrust for building more classrooms, hiring more teachers and increasing their salaries as well as adopting a curriculum that would make learning easier for students and more attuned to the Philippine situation.”

“The PISA results also show that the militaristic and ‘do as I say without questions asked-style’ in the DepEd now is detrimental to the learning of students,” she said. “That allocating funds for surveilling students and teachers is wrong since it deprives funds to hire more teachers or build more classrooms.”

Ms. Duterte, who in August said “education is intertwined with national security,” has received backlash in recent months for initially seeking a total of P650 million in confidential and intelligence funds divided between the DepEd (P150 million) and her office as vice-president.

Confidential funds are used for surveillance operations within civilian government agencies, while intelligence funds are used for intelligence-gathering activities by uniformed personnel.

Senator Sherwin T. Gatchalian, chair of the Senate panel on education, called for the swift passage of the proposed ARAL Program Act, which seeks to allocate P10 billion for programs that would address pandemic-related learning loss and boost learners’ access to well-designed remediation plans.

The Senate has already approved the bill on third and final reading last March.

Leonardo A. Lanzona, an economist at the Ateneo de Manila University, said education should be a crucial aspect of the country’s goal to reach upper middle-income status.

“Learning affects productivity and wages. For a country that aspires to reach upper middle-income status, education will be crucial especially in an environment of accelerating technological changes,” he said in a Facebook Messenger chat.

He said the education sector should heavily benefit from public-private partnerships (PPP). “When we speak of public investments and PPPs, education should be prioritized over infrastructure and other physical capital investments.”

“The state of education in the Philippines demands immediate attention, collective effort, and a commitment to improvement so we can give our children the best learning experience that they deserve,” PBED said.

ADB approves $450-M loan to fund universal healthcare in PHL

Healthcare workers are seen at a hospital in Manila. — PHILIPPINE STAR/KRIZ JOHN ROSALES

THE ASIAN Development Bank (ADB) on Wednesday said it has approved a $450-million loan (around P24.9 billion) to fund the Philippines’ Universal Health Care (UHC) program.

In a statement on Wednesday, the ADB said the loan aims to strengthen health policy reforms in the Philippines, as well as improve Filipinos’ access to medicine and health services. It also seeks to “sustain universal healthcare coverage and increase financing for UHC.”

The funds will go to the implementation of the Build Universal Health Care Program (Subprogram 2), which will implement reforms such as sustainable financing for UHC, the integrated delivery of quality health services, and the interoperability of health information systems.

“The Build UHC Program is part of ADB’s commitment to deliver long-term support to the country to ensure all Filipinos have equitable access to quality health services without exhausting their finances… The program will also help ensure the reforms are responsive to gender-specific health issues and the impacts of climate change on people’s health and well-being,” ADB Principal Health Specialist Eduardo Banzon said.

The ADB said the Philippine government has adopted an updated health financing strategy, a national medicine access policy, and the National Health Data Repository framework under the Build UHC Subprogram 2.

The government also implemented the Green and Safe Health Facilities program to ensure public health facilities are “disaster-resilient, environmentally sustainable, and gender-responsive.” It also boosted the number of available primary care providers, as well as enhanced the primary care benefits under the National Health Insurance Program.

“The government expanded health promotion activities in communities, workplaces, and schools across the country, including the designation of barangay health workers as community-level health education and promotion officers. The government also initiated an annual monitoring of UHC outputs and introduced performance incentives for local government units,” the ADB said.

In 2019, President Rodrigo R. Duterte signed Republic Act No. 11223 or the Universal Health Care Act. It aims to ensure all Filipinos have access to cost-effective and quality healthcare services.

Last month, the ADB approved a $400-million loan for the Philippines to reform tax policies and ramp up revenue collection.

Earlier this week, the ADB said it is allocating $10 billion (around P553 billion) in climate finance for the Philippines starting next year until 2029. This would allow the Philippines to implement its commitments to climate action under the Paris Agreement.

The ADB was the country’s top provider of active official development assistance (ODA) in 2022. It extended $10.85 billion worth of assistance, equivalent to 33.47% of the total ODA portfolio.

The multilateral lender is looking to earmark between $3.5 billion and $4 billion annually in loans for the Philippines until 2029. — Luisa Maria Jacinta C. Jocson

PHL debt level to remain sustainable — World Bank

BW FILE PHOTO

THE PHILIPPINES’ debt levels are expected to remain sustainable in the medium term, the World Bank said.

“The National Government debt ratio is projected to decline over the forecast horizon, reaching around 60% of GDP by 2025, although financing needs remain elevated compared to pre-pandemic levels,” the bank said in its latest Philippine Economic Update.

“However, debt is set to remain sustainable, as the debt-to-GDP ratio is expected to revert to a downward trajectory beginning in 2023 due to fiscal consolidation and robust growth,” it added.

The National Government (NG) debt as a share of gross domestic product (GDP) stood at 60.2% at the end of the third quarter, data from the Treasury showed.

This was lower than 61% at the end of the second quarter and the 63.6% posted a year ago.

However, it is still slightly above the 60% threshold considered by multilateral lenders to be manageable for developing economies.

The Philippine government is targeting to bring down its debt-to-GDP ratio to below 60% by 2025.

“Currently, the country’s financial system may still be relatively deep enough to accommodate the large financing needs, although excess liquidity may diminish over the medium term,” the World Bank said.

“Moreover, the composition of debt is expected to remain stable, with low shares of short-term debt and foreign currency-denominated debt, in line with the government’s debt management strategy,” it added.

NG debt reached a record P14.48 trillion as of end-October, rising 6.16% from P13.64 trillion a year ago.

As of end-October, the bulk or 68.38% of the NG’s debt portfolio came from domestic sources.

Meanwhile, the ASEAN+3 Macroeconomic Research Office (AMRO) said that an increase in the debt-to-GDP ratio in ASEAN+3 countries may raise the likelihood of a fiscal crisis.

“Overall, the result reveals that the higher the debt ratio, the higher the probability of a crisis, with that experience less likely in developed economies than emerging market economies,” it said in a recent report.

“At their respective debt levels as of 2022, the average probability of a fiscal crisis is estimated to be 37% for an average emerging market economy and 7% for an average developed economy,” it added.

AMRO said that excessively high debt levels may also threaten a government’s fiscal sustainability.

“This raises the risk of fiscal crisis, which can, in turn, erode investor confidence. Moreover, if the value of debt falls due to concerns about the government’s debt repayment capacity, financial sectors including banks, would incur valuation losses in their holdings of government debt,” it said.

“Foreign investors may take fright and pull out from the market, leading to capital outflows. The heightened volatility in exchange rates and increased capital flight would compound the difficulties,” it added. 

Estimates from AMRO show that the average probability of a fiscal crisis for the region’s emerging markets increased to 26% in 2022 from 15% in 2008. However, it noted this was lower than the average in global emerging markets.

The think tank recommended that governments in the region should establish a “sound debt structure” with an appropriate maturity profile and proper currency distribution.

It also recommended diversifying the investor base to mitigate impact from shocks, enhance market liquidity, utilize emergency liquidity facilities, and maintain a sustainable debt level and growth rate. — Luisa Maria Jacinta C. Jocson

Customs surpasses Nov. collection target

BW FILE PHOTO

THE BUREAU of Customs (BoC) said it surpassed its collection target for the month of November as well as its goal for the 11-month period.

Preliminary data from the BoC showed that it collected P75.338 billion in November, exceeding by 1.5% its target of P74.249 billion for the month.

However, the November collection was 0.5% lower than P75.724 billion it collected in the same month a year ago.

Customs Commissioner Bienvenido Y. Rubio told reporters on Wednesday that its performance in November was due to improved tax collection.

“If we’re talking about volume, it didn’t increase. (Our collection) was more on the efficiency of tax collections. (We) are doing great in assessing goods that are coming in,” he said.

From January to November, the agency collected P813.651 billion, 2.2% higher than its P795.966-billion target for the period. 

Its collection in the 11-month period accounted for about 93% of its P874.166-billion full-year target. 

Year on year, revenues also rose by 3.09% from P789.246 billion in the same period in 2022.

Mr. Rubio said the agency is on track to meet its collection target this year and may even post a surplus.

“I think we’re on track. We see every month we are recording surpluses, except for that one month that we were short, but we were able to recover,” he added.

For December, the agency is targeting to collect P78 billion. — Luisa Maria Jacinta C. Jocson 

Telco tower firm allots P3.7B for PHL expansion

STOCK PHOTO | Image by David Arrowsmith from Unsplash

By Ashley Erika O. Jose, Reporter

EDOTCO Towers Inc. is allocating P3.7 billion for its network expansion alone in the country, the company’s top local official said, citing the need to increase connectivity in the Philippines.

“In 2024, we have earmarked over P3 billion as investments to build and expand our network,” Suraj Narayanan Kutty, EDOTCO Philippines country manager, told BusinessWorld in an interview on Wednesday.

In total, the company had acquired more than 2,000 towers, Mr. Kutty said, adding that the company had acquired close to 2,000 towers in 2022, which is considered its major activity due to the sale and leaseback, and another 700 towers this year.

In 2022, the company had set its goal of building nearly 500 towers in Luzon to help the government achieve its target of 66,000 new tower builds by 2026.

“Our focus has changed. The rollout targets have shifted mainly because the customer demand has changed,” he said.

Last year, PLDT Inc. said it had received about P57.7 billion from the sale of 4,435 telecom towers — with over 2,000 towers being acquired by EDOTCO Towers.

The company expects increased investment in the Philippines’ telecommunications structure, he said, as the country needs more towers to help improve internet connectivity.

The country’s mobile network operators are using shared towers to help accelerate and eventually lower the cost of digital transformation in the country while also helping improve the state of the Philippines’ internet connectivity.

“Tower sharing is the very key [as it results in] fastest speed and adds to savings,” he added.

TAPPING RENEWABLES
The company is also planning to tap energy companies to power its towers with renewable energy such as solar energy, Mr. Kutty said.

“Typically solar power reduces cost by 20-25%,” he added, citing the rising cost and volatility of diesel generators especially in remote areas.

He said the company is in talks with energy companies for the planned shift, which he said might start by next year.

“Right now, none of our towers are solar powered. The team right now is assessing the towers, the energy requirement of towers,” he added.

EDOTCO Group Sdn. Bhd. owns and operates about 54,000 towers spread across Malaysia, Indonesia, Bangladesh, Cambodia, Sri Lanka, Pakistan, Philippines, Myanmar, and Laos.

Last year, Manila Electric Co. announced that it would energize the expansion of EDOTCO Towers.