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Fintech firm Salmon partners with companies for loan payments

CONSUMER financial technology (fintech) firm Salmon has partnered with five Philippine companies for easier loan payments, it said on Tuesday.

Salmon has partnered with M Lhuillier Financial Services, Inc., SM stores for their bills payment centers, Union Bank of the Philippines, Inc. (UnionBank), Bank of the Philippine Islands (BPI), and Rizal Commercial Banking Corp. (RCBC), it said in a statement.

“We are delighted to have expanded our partnerships with these esteemed financial institutions, making it very easy and convenient for Salmon customers to make their loan payments in person or online. This step marks another important milestone for Salmon, as we bring transparent and convenient services to ordinary Filipinos across the country,” Salmon Philippines Co-founder and Business Head Raffy Montemayor said.

Under the partnerships, customers can make online payments through UnionBank, BPI, and RCBC.

“Customers can make payments online and will be redirected to a partner bank’s page for login, receiving a one-time password and payment confirmation,” Salmon said.

Online payments may also be made through GCash and Maya Bank.

For in-person payments, customers can generate a reference number or barcode through the Salmon app and use it to pay at 8,570 locations in 7-Eleven and Cebuana Lhuiller stores.

“Salmon added 3,070 new in-person repayment locations, a 56% increase from 5,500 7-Eleven and Cebuana Lhullier stores, already available to customers before the new partnerships were signed,” the company said.

Salmon recently closed a $20-million debt funding round, it said. The funding was led by Argentem Creek Partners, an emerging markets specialist investor.

Fintech Holdings Ltd., operating under the name Salmon, was founded in July 2022 by Pavel Fedorov, George Chesakov, and Mr. Montemayor. — AMCS

Elton John spends night in hospital after slip at his French home — BBC

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LONDON — British singer Elton John spent a night in hospital in Monaco being treated for minor injuries after he slipped over at his villa in Nice, the BBC reported on Monday, citing his spokesman.

The 76-year-old, who completed his long-running Farewell Yellow Brick Road tour last month, was taken to the orthopedic department of the Princess Grace hospital center in Monaco, the BBC said.

“Elton visited the local hospital as a precautionary measure,” the spokesman said. “Following check-ups, he was immediately discharged this morning and is now back at home and in good health.” — Reuters

Lower transaction fees crucial for SME digitalization — Enstack

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TRANSACTION FEES for digital payment acceptance should be reduced to incentivize and expedite the digitalization of  small- and medium-sized enterprises (SMEs), according to Enstack, a local e-commerce solutions provider.

“Digitalizing SMEs in the Philippines remains challenging due to high transaction fees and the cumbersome payment account setup processes,” the company said in an e-mailed statement.

“Transaction fees, currently averaging 3% for person-to-merchant (P2M) payments, drive up operational costs and push small businesses towards less scalable person-to-person (P2P) payment methods,” it added.

Enstack noted that the government acknowledges the necessity of aiding SMEs, as the digital economy contributed 9.4% to the gross domestic product, equivalent to P3 trillion in 2022.

The Philippine central bank aims to digitize 50% of retail payments to empower small businesses, foster economic growth, and bridge the digital gap in the Philippines, it said.

Enstack noted that reducing transaction fees can help SMEs expand their customer base.

At the same time, there is a need to simplify payment account setup. One solution, according to Enstack, is requiring an ID and proof of billing to start accepting debit and card payments. Online bank transfers and wallet payments can be facilitated with an ID from the merchant, it noted.

Another suggestion is optimizing end-to-end digital payment tools. Manual processes can lead to inaccuracies in inventory and payment management, Enstack said.

“By providing practical solutions tailored to the unique challenges faced by SMEs, we aim to empower them to embrace the benefits of online commerce and maximize their growth potential,” said Macy Castillo, Enstack’s chief executive officer and co-founder.

Enstack is organizing its first Build-a-Biz competition to improve the adoption of digital sales strategies among SMEs.

The competition offers a cash prize of P1 million to the SME with the highest grossing sales completed through the Enstack app by yearend.

Businesses must register with the app by Oct. 31 and compete for the highest sales in any two-month period between July 1 and Dec. 31 this year to win the top prize.

The winner also gets to receive mentorship and brand exposure.

“During the contest, participants gain access to a dedicated support team, exclusive expert webinars, and the knowledge to navigate the digital landscape successfully. Our platform minimizes setup challenges, enabling a swift and effective store launch and checkout,” Ms. Castillo said. — Patricia B. Mirasol

As Australia strengthens its ties with the Philippines, it’s wading even further into the dangerous South China Sea

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At the end of last week, 1,200 Australian troops took part in a joint military exercise in the Philippines with hundreds of Filipino and American forces. Their mission: simulating the retaking of an island by a hostile force, presumably in the South China Sea.

Australian Defense Minister Richard Marles joined Filipino President Ferdinand Marcos, Jr. to observe the drills, reportedly the largest ever between the two nations. Marles then announced Australia would begin joint maritime patrols with the Philippines in the contested South China Sea very soon.

Next week, Prime Minister Anthony Albanese will also visit the Philippines, with maritime issues, defense and security on the agenda.

Although Marles was careful not to reference China directly during a press conference in the Philippines, Australia’s push to deepen its strategic ties with Manila comes at a time of heightened tensions with Beijing in the South China Sea. (It’s known as the West Philippine Sea in the Philippines).

In early August, a Chinese coast guard vessel used a water cannon against a Filipino coast guard boat that was attempting to deliver supplies to soldiers manning a grounded naval vessel on Second Thomas Shoal (or Ayungin in the Philippines).

Manila maintains the shoal is in its exclusive economic zone. China, meanwhile, claims it falls within its sovereign territory.

The incident is just the latest in a series of aggressive, harassing actions by the Chinese coast guard and maritime militia in the area since the beginning of the year.

So, with tensions running so high in the sea, why is Australia getting involved by deepening its military ties with the Philippines? What impact could this have on the region?

The Philippines is among five other competing claimants in the South China Sea, along with Brunei, Malaysia, Vietnam, Taiwan, and China. Unlike China, which claims sovereignty over the entire South China Sea using the so-called “nine-dash line,” the others assert only limited sovereignty in the area.

In 2016, the Philippines won a landmark case against China in an international tribunal in The Hague that declared the “nine-dash line” invalid and a violation of the United Nations Convention on the Law of the Sea. China did not recognize the ruling and has been continuing its military build-up in the sea and harassment of Philippine vessels.

Although the Philippines gained widespread international support with the ruling, it remains militarily weak and limited in its ability to thwart Chinese incursions in its exclusive economic zone.

This has been a main focus of the Marcos administration since taking office in June 2022. During a visit to the White House in May, Marcos and US President Joe Biden agreed to new guidelines on the countries’ 1951 Mutual Defense Treaty.

This treaty commits both parties to respond in the event of an attack on either one “anywhere in the South China Sea.” Notably, the guidelines also acknowledge the threats posed by “grey zone tactics,” such as blockades, intimidation, and harassment.

This year, the Philippines also agreed to add four more military bases the US can access under a separate defense agreement.

Due to China’s aggressive actions in the South China Sea and adamant refusal to recognize the tribunal ruling on the “nine-dash line,” public opinion in the Philippines now shows a high level of distrust towards China (67%). In contrast, there is a high level of trust towards the US (89%), Australia (79%), and Japan (78%).

This lack of trust towards China is shared by many in the Philippine government, defense establishment, and legislature.

At the same time it has re-pivoted towards the US, the Philippines government has also been busy enhancing its defense and diplomatic ties with Australia.

In May, Foreign Minister Penny Wong visited Manila and announced Australia’s readiness to elevate their relationship to a “strategic partnership.” She also reiterated Australia’s commitment to continue its presence in the South China Sea to promote peace and stability, as well as freedom of navigation.

Marles pointed out last week that much of Australia’s trade goes through the South China Sea and Australia is committed to upholding the international rules-based order in the region.

Albanese’s upcoming visit to Manila will build on these diplomatic overtures. The two countries are expected to sign agreements that will formalize their strategic partnership. These will cover defense and maritime security cooperation, as well as enhanced economic, trade, and cultural ties.

These stronger ties don’t come out of nowhere. While Australia doesn’t have the same kind of mutual defense treaty with Manila, it has a deep defense relationship with the Philippines dating back to the second world war.

Australia and the US are also the only two countries with a “visiting forces” agreement with the Philippines, which provides a legal framework for Australian and American troops to be in the country.

Given Australia has recently sought to steady its rocky relationship with China, this cooperation with the Philippines could come at a cost. As expected, China voiced its displeasure over last week’s military drills.

Over the long term, both Australia and the Philippines should also be aware of the risks posed by their security alliances with the US, which could potentially involve them both in a conflict with China over Taiwan or the South China Sea.

As the military drills last week make clear, Australia seems prepared to take that risk and step up its cooperation with a key regional ally nonetheless. As Marles pointedly said in Manila, the global rules-based order is “deeply connected to our respective national interests” and “collective security.”

THE CONVERSATION VIA REUTERS CONNECT

 

Noel Morada is the director (Regional Diplomacy and Capacity Building) of the Asia-Pacific Center for the Responsibility to Protect at The University of Queensland. The Asia-Pacific Center for the Responsibility to Protect receives funding from the Department of Foreign Affairs and Trade of Australia.

How PSEi member stocks performed — August 29, 2023

Here’s a quick glance at how PSEi stocks fared on Tuesday, August 29, 2023.


Peso drops vs dollar on hawkish Fed bets

THE PESO depreciated against the dollar on Tuesday due to hawkish signals from US Federal Reserve Chair Jerome H. Powell at the Jackson Hole Economic Symposium over the weekend.

The local currency closed at P56.75 versus the dollar on Tuesday, weakening by 18 centavos from Friday’s P56.57 finish, data from the Bankers Association of the Philippines’ website showed.

The local unit opened Tuesday’s session at P56.70 per dollar. Its intraday best was at P56.55, while its weakest showing was at P56.81 against the greenback.

Dollars traded went down to $1.28 billion on Tuesday from the $1.32 billion on Friday.

The peso was dragged down by hawkish signals from Mr. Powell’s speech on Friday, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“The peso weakened after Fed Chair Powell hinted at a prolonged period of elevated US policy rates during his speech at the Jackson Hole Symposium,” a trader likewise said in an e-mail.

The Federal Reserve may need to raise interest rates further to cool still-too-high inflation, Mr. Powell said on Friday, promising to move with care at upcoming meetings as he noted both progress made on easing price pressures as well as risks from the surprising strength of the US economy, Reuters reported.

While not as hawkish a message as he delivered this time a year ago at the annual Jackson Hole Economic Policy Symposium, Mr. Powell’s remarks still delivered a punch, with investors now seeing one more rate hike by yearend more likely than not.

The Fed has raised rates by 5.25 percentage points since March 2022, and inflation by the Fed’s preferred gauge has moved down to 3.3% from its peak of 7% last summer. Although the decline was a “welcome development,” Mr. Powell said, inflation “remains too high.”

The Fed will hold its next policy review on Sept. 19-20.

For Wednesday, the trader said the peso could rebound on expectations of a softer US Job Openings and Labor Turnover Survey report overnight, which could signal easing labor market conditions.

The trader expects the peso to move between P56.60 and P56.85 per dollar on Wednesday, while Mr. Ricafort sees it ranging from P56.65 to P56.85. — AMCS with Reuters

Stocks up on window-dressing ahead of US data

STOCKS climbed on Tuesday amid month-end window-dressing and as investors await the release of US data that could affect the next policy move of the Federal Reserve.

The Philippine Stock Exchange index (PSEi) rose by 64.39 points or 1.04% to close at 6,225 on Tuesday, while the broader all shares index climbed by 22.22 points or 0.66% to end at 3,354.62.

“Philippine shares opened the week higher as trading gears up for window dressing. On the data front, investors await data on home prices, job openings and consumer confidence due Tuesday morning,” Regina Capital Development Corp. Head of Sales Luis A. Limlingan said in a Viber message.

Meanwhile, AB Capital Securities, Inc. Vice-President Jovis L. Vistan said that shares rallied to track the increase in Asian shares.

“Moreover, a long-awaited technical rally also ensued as a number of local issues had recently dipped into oversold territory,” Mr. Vistan said.

“Market sentiment received a much-needed boost from China’s strategic initiatives aimed at revitalizing its economy. The decision to lower benchmark interest rates and decision to reduce the stock trading stamp duty garnered a positive response from investors,” he added.

China stocks led Asian shares higher on Tuesday with investors welcoming Beijing’s efforts at supporting markets, while bonds rallied and the dollar dipped on possibly softening US data, Reuters reported.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1%, with the Hang Seng in Hong Kong up more than 2% and mainland China blue chips up 1.5%.

China has halved stock trading stamp duty, loosened margin loan rules, put the brakes on new listings and approved new retail funds in recent days — signaling, at least, resolve to steady the market even if it does little to support the sputtering economy.

After selling into Monday’s initial bounce, after the measures were announced over the weekend, foreign investors were net buyers of about $500 million in Chinese stocks on Tuesday perhaps in the hope that more substantive aid will follow.

Back home, all sectoral indices rose on Tuesday. Services increased by 22.90 points or 1.52% to 1,529.69; property climbed by 38.55 points or 1.5% to 2,598.37; mining and oil went up by 118.46 points or 1.19% to 10,048.79; financials rose by 18.27 points or 0.99% to 1,847.73; industrials improved by 50.69 points or 0.58% to 8,751.29; and holding firms added 21.82 points or 0.37% to end at 5,862.70.

Value turnover went up to P5.63 billion on Tuesday with 395.06 million shares changing hands from the P3.57 billion with 340.80 million issues seen on Friday.

Decliners narrowly outnumbered advancers, 89 to 85, while 53 names closed unchanged.

Net foreign selling went down to P219.17 million on Tuesday from P657.76 million on Friday.

For this week, Mr. Vistan placed the PSEi’s support at 6,100 and resistance at 6,300. — SJT with Reuters

Nickel miners expect output to be little changed in 2023

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THE Philippine Nickel Industry Association (PNIA) said nickel production is expected to be flat this year, with miners hoping to make up for a weak first half before the close of mining season in October.

At a briefing on Tuesday, PNIA President Dante R. Bravo said: “Production is basically the same. The areas (that are supplying nickel) right now are limited in their production.

Regarding the weak first half performance, he said: “We are trying to catch up this time around but some of the mines will be shutting down by October.”

As such, he expects output “to be the same” as 2022’s, Mr. Bravo added.

In 2022, nickel direct shipping ore output declined 11% to 29.27 million dry metric tons, according to the Mines and Geosciences Bureau.

Mr. Bravo added that the PNIA is urging the government to fast-track the approval of mining permits by establishing a “one-stop shop” for the application process. Such a streamlining of approvals, he said, will attract more investment to the industry.

“If we can streamline the process, it would be easier to convince investors,” he said.

While the government is focused on attracting investment in value-added processing, industry development efforts should include exploration and extraction, he said.

He added that a nickel processing plant requires more than 100 million tons of raw nickel ore each year for at least 20 years to be considered viable.

Mr. Bravo said that the measures required would include a simplified fiscal regime, harmonized national and local mining regulations, and stepped-up environmental monitoring.

“To produce the minimum raw ore input requirement of one processing plant, mining permits need to be approved efficiently and awarded contracts should be allowed to operate with minimal disruption under a predictable, rules-based regulatory regime,” he said.

He said demand for nickel will continue to rise due to demand from battery producers, according to Mr. Bravo.

“We have a potential to supply beyond 40 million tons, probably even more, because of the take-up of nickel right now. (Demand from) the battery industry is increasing year in, year out,” he said.

“The opportunity will come as we see that the price becoming more stable and it becomes more viable to access other mining areas,” he added. “We have a chance to grow the supply here in the Philippines.” — Adrian H. Halili

DENR declares support for ‘critical minerals’ exploration

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THE Department of Environment and Natural Resources (DENR) said it will provide support for efforts to discover deposits of “critical minerals” like iron, cobalt, rare earths, as well as nickel.

Speaking at a forum organized by the Philippine Nickel Industry Association, Environment Secretary Maria Antonia Yulo-Loyzaga said on Tuesday that “starting in 2024 through the DENR’s Mines and Geosciences Bureau (MGB) and a new office for integrated environmental science, we will be concentrating on priority activities” like “extensive government led exploration for critical minerals.”

She said that the DENR is also directing the MGB to focus on enabling mineral exploration next year through partnerships with foreign investors.

“This effort would be augmented by technical support coming from our foreign development partners, including the Australian government and the US Geological Survey,” she added.

Ms. Yulo-Loyzaga also said that the DENR is seeking to “promote and enable” domestic mineral processing, particularly for laterite, a rock with high iron and aluminum content.

These initiatives “aim to maximize the value of our mineral resources… (for use in) our own energy transition and economic development,” she said.

Ms. Yulo-Loyzaga also said that the DENR remains focused on pursuing a policy that assigns greater weight to “the avoidance of all possible environmental impact.”

In a statement issued also on Tuesday, the DENR said it has signed a memorandum of agreement (MoA) with the Manila Observatory for a climate change information system.

Under the MoA, a digital database of climate and environment will be made available to the public, particularly to local government units, other National Government agencies, schools, civil society organizations, and the private sector. — Adrian H. Halili

BoC signals hoarding crackdown with plan to inspect warehouses

THE Bureau of Customs (BoC) said on Tuesday that it plans to inspect warehouses holding imported rice for tax compliance and to determine whether inventory levels constitute hoarding.

The BoC will validate the inventories of warehouses storing imported rice, Commissioner Bienvenido Rubio said at a Palace briefing, “and then upon validation, we will then issue letters of authority to conduct inspection on these warehouses.”

The BoC will “validate whether the imported rice paid the correct duties and taxes,” he added.

Recently, the BoC raided three Bulacan warehouses, where it found 202,000 sacks of imported rice valued at P505 million.

The rice stored in Great Harvest Rice Mill Warehouse, San Pedro Warehouse, and FS Rice Mill Warehouse were imported from Vietnam, Cambodia, and Thailand, respectively.

Mr. Rubio said the BoC gave the owners of the warehouse 15 days to submit documents, including proof of tax payment, to demonstrate that the rice was properly imported and released for storage.

“The warehouses were sealed temporarily to secure the imported sacks of rice found therein pending the completion of the inventory by the assigned examiners which will continue today, (Aug. 29), he said.

Should the warehouses fail to submit the documentation, the contents of the facilities may be subject to a warrant of seizure, Mr. Rubio said.

Earlier this month, President Ferdinand R. Marcos, Jr. urged the Trade and Agriculture departments to closely monitor retail prices of rice, while saying supply is sufficient even with prices rising. Some retailers are selling rice at P38 to P40 per kilo “while some are selling their cheapest variety at P50 per kilo,” the Palace said at the time.

The steady increase in the commodity’s prices pushed rice inflation to 4.2% in July, its highest level since 2019.

The Department of Agriculture has recommended that the private sector import an additional 500,000 metric tons (MT) of rice in anticipation of El Niño, which is expected to be “moderate or strong” by the end of 2023 or early 2024, possibly dampening crop production.

Mr. Rubio said Philippine rice imports have been declining this year, with imports in the seven months to July amounting to 2.26 million MT, down 15.63% from a year earlier. — Kyle Aristophere T. Atienza

Infra law TRO ban applicable to all procurements — DBM

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THE Department of Budget and Management (DBM) said a law banning temporary restraining orders (TROs) against infrastructure projects has established a legal principle that can be applied more broadly to a blanket TRO ban on all procurement exercises.

Republic Act (RA) 8975, formally known as “An Act to Ensure the Expeditious Implementation and Completion of Government Infrastructure Projects by Prohibiting Lower Courts From Issuing Temporary Restraining Orders, Preliminary Injunctions, or Preliminary Mandatory Injunctions, Providing Penalties for Violations Thereof, and for Other Purposes,” can be applied to the procurement system in general, and not just to infrastructure projects, DBM Procurement Service (PS) Executive Director Dennis S. Santiago said in a Viber message.

The DBM is seeking “to apply the same legal principle in RA 8975 to procurement of goods and services, including consulting services, to address delays in government procurement, achieve early completion of projects, and deliver goods and services on time. Under the proposal, (only) the Supreme Court would have the jurisdiction to issue (a TRO),” he added.

The DBM is in the process of completing the proposed amendments to the Government Procurement Reform Act of 2007 for submission to Congress.

In his second State of the Nation Address, President Ferdinand R. Marcos, Jr. called for reforms to the procurement law “to make government procurement more attuned to these changing times.”

The broadening of the TRO ban will “tackle possible delays in the procurement process because of suits filed by losing bidders,” according to the DBM.

Another proposed amendment by the DBM is to apply a no-bid process for goods and services worth around P250,000 or possibly less.

Mr. Santiago said that the threshold for no-bid procurement has yet to be determined. “The P250,000 figure is a proposal. The amount can be P50,000 or lower,” he added.

“The ‘direct acquisition’ procurement modality is being proposed to enhance efficiency and timeliness in the procurement of goods that are essential and necessary in the proper conduct and performance of government agencies’ functions and responsibilities,” he added.

Mr. Santiago said the amendments aim to “fulfill the needs and demands of the agency within the time frame without having to go through the entire bidding process for procurement of goods of low value.” 

“As you may know, the bidding process takes some time, and there are also externalities that contribute to delays in government acquisition,” he added.

Budget Secretary Amenah F. Pangandaman has said that procurement issues have had an “adverse impact” on public service delivery.

“Of our total National Government budget, up to 25% is (used on) procurement. These are the reasons that this reform has become necessary, tedious as the process may be,” she added.

The reform of procurement law also aims to help government agencies accelerate spending. — Luisa Maria Jacinta C. Jocson

House adopts Senate version of job creation master plan measure

THE House of Representatives on Tuesday adopted the Senate’s version of a bill that would create a national employment master plan.

In plenary session, the adoption of Senate Bill (SB) No. 2035 or the proposed Trabaho Para sa Bayan Act, was adopted via voice vote. The bill effectively substitutes for House Bill No. 8400.

The proposed law calls for a job-creation plan with three-year, six-year, and ten-year timelines to aid the post-pandemic recovery.

“The Trabaho Para sa Bayan Plan shall serve as the State’s master plan on employment generation and recovery to realize short-term and long-term goals and visions for the country,” according to SB 2035.

The plan is expected to offer incentives to stimulate investment to address unemployment, underemployment, and the rising informality of work arrangements. It also seeks to provide skills training to enhance the employability of workers, and support micro, small, and medium enterprises.

The Senate bill includes incentives for offering training, technology, knowledge transfer, upskilling, reskilling, and enterprise-based training programs such as apprenticeship, work immersion, and on-the-job training.

It also seeks to identify priority sectors and key and emerging industries with high employment potential with strong prospects for attracting direct investment.

The bill also calls for a national reintegration program for documented and undocumented overseas Filipino workers.

SB 2035 was approved in May while the House passed its bill on Aug. 22. — Beatriz Marie D. Cruz