Typhoon funds ordered released

August 2, 2023 | 8:51 pm

BAGUIO CITY — The Department of Human Settlements and Urban Development has ordered the release of cash assistance to families who lost their homes to Super Typhoon Doksuri, locally named Egay.

Almost 2,000 houses had been damaged by the typhoon, mostly from the Ilocos region, Cagayan Valley and Cordillera Administrative Region, it said in a statement on Wednesday.

Human Settlements Secretary Jose Rizalino Acuzar has ordered his subordinates to start releasing the funds to regional offices affected by the typhoon. — Artemio A. Dumlao

Gov’t told to jail onion riggers

August 2, 2023 | 8:51 pm

smuggled-onions-MICP-media-vewing-09062017-3 — BUREAU OF CUSTOMS

THE PHILIPPINE government should ensure the prosecution and punishment of people who colluded to rig the prices of onions at the start of the year, In Defense of Human Rights and Dignity Movement said on Wednesday.

“We support the imposition of the full weight of the law on the officials being investigated, criminal prosecution of those involved and a lifetime ban on their employment in government,” it said in a Twitter message.

Ombudsman Samuel R. Martires has ordered the suspension of Agriculture and Food Terminal, Inc. officials for violating the Procurement law in the delivery of 8,845 bags of onions to Kadiwa food outlets, which sells farm products to the poor.

“Kadiwa has provided an opportunity for corruption and irregularities so It should be fully investigated as well,” the group said. — John Victor D. Ordoñez

CHED officials appointed

August 2, 2023 | 8:50 pm

PRESIDENT Ferdinand R. Marcos, Jr. has appointed three new officials of the Commission on Higher Education (CHED), the agency said in a statement on Wednesday.

Named directors IV were Iloilo Science and Technology University President Raul Muyong, Corinna Frances Cabanilla and Christine Ferrer.

Ms. Cabanilla served as director-in-charge of the local graduate scholarship programs of CHED for faculty members, while Ms. Ferrer is a faculty of the College of Education of the Tarlac Agricultural University.

Sale of defunct GOCCs’ assets expected to raise over P25B

August 2, 2023 | 8:37 pm

THE GOVERNMENT may raise more than P25 billion by selling the assets of 31 defunct government corporations, the Governance Commission for Government-Owned or -Controlled Corporations (GCG) said.

In chance remarks to reporters on Tuesday, GCG Commissioner Gideon DV. Mortel said some of the corporations have been inactive since 2013, injecting a sense of urgency to the task of unlocking value from their assets.

“If you put together all the remaining assets, it’s somewhere between P22 to P25 billion. But based on a recent assessments, tataas pa ’yon (the value could be higher),” Mr. Mortel told reporters.

“GCG Chairman Justice Alex L. Quiroz (wants) to prevent any dissipation or wastage of the remaining resources of these abolished Government-Owned and -Controlled Corporations (GOCCs),” he said.

During the coordination and preliminary meetings with these abolished GOCCs, the lack of personnel and absence of a quorum in the governing boards of abolished GOCCs became a challenge to the GCG, the GCG has said.

The GCG also announced last week that it is drafting an executive order to expedite the liquidation process.

According to Mr. Mortel, the GCG plans to complete the draft within the next two weeks and submit it to President Ferdinand R. Marcos, Jr. for approval.

He also said there is a need to harmonize the liquidation process as the conditions of asset disposal for many defunct GOCCs are governed by separate memoranda or executive orders issued at the time they were inactivated.

“Given these different approaches, we came up with the idea of having a single executive order that will govern all of this so we can liquidate all of them,” he said.

Mr. Quiroz also told reporters that the GCG is in a hurry to process all of these assets.

“To avoid dissipation of funds of GOCCs, we need to move fast,” he said.

As the GOCC regulator, the GCG is empowered to evaluate the performance of any state corporation to ascertain whether they should be reorganized, merged, streamlined, abolished or privatized.

This year, the Department of Finance’s Privatization and Management Office is aiming to dispose of at least 143 properties worth P2.5 billion.

LANDBANK-DBP MERGER
Separately, Mr. Quiroz said the GCG’s study on the merger of the Land Bank of the Philippines (LANDBANK) and the Development Bank of the Philippines (DBP) is still ongoing.

“There are a lot of things to be considered. First, the merger between United Coconut Planters Bank (UCPB) and LANDBANK is not yet finished,” he said.

In June 2021, then-President Rodrigo R. Duterte signed an executive order approving the merger of the two major government banks, in which all assets and liabilities of UCPB will be transferred to LANDBANK. The merger took effect in March 2022.

Mr. Quiroz also noted that management, operations, and labor are the major considerations in the merger of DBP and LANDBANK.

Asked if the merger can happen by next year, Mr. Quiroz said “let’s not rush and let’s carefully study it first.”

In May, Mr. Quiroz said a technical team from the GCG is currently working to calibrate the positions and classifications of the banks’ workers.

Finance Secretary Benjamin E. Diokno has said that the merger between the two banks will likely be completed by the first half of next year.

Once combined, LANDBANK and DBP will have assets of P4.185 trillion and deposits of P3.588 trillion, according to the Finance department.

The merged entity will become the sole authorized government depository bank. — Keisha B. Ta-asan

BIR urges online sellers to honor senior citizen, PWD discounts

August 2, 2023 | 8:37 pm

THE Bureau of Internal Revenue (BIR) said senior citizens and persons with disability (PWDs) cards can be used to obtain discounts on online purchases.

“Online platforms should recognize the mandatory discounts given to senior citizens and persons with disabilities,” the BIR said.

“The signature of the senior citizen or PWD is not needed if the purchase is made through online means. The senior citizen or PWD identification card number should still be provided,” it added.

The BIR said Revenue Regulations No. 8 clarifies the mandatory nature of senior citizen and PWD benefits for qualified purchases made through online or mobile applications.

Senior citizens and PWDs are entitled to a 20% discount and are exempt from value-added tax on certain goods and services. — Luisa Maria Jacinta C. Jocson

PHL considering role for Singapore satellite company in digitization push

August 2, 2023 | 8:37 pm

PRESIDENT Ferdinand R. Marcos, Jr. has directed two departments to pursue talks with Kacific Broadband Satellites Group to explore how it can aid in digitizing the government, the Palace said.

Mr. Marcos and the Secretaries of Information and Communications Technology and of Science and Technology met with the Kacific executives led founder and CEO Christian Patouraux to discuss the Philippines’ plans for going digital, the Palace said in a statement.

Kacific, a Singapore broadband satellite operator based, is set to launch a second satellite, Kacific2, to expand and improve the reliability of its internet services.

After the meeting, the president directed the two departments to “continue with the talks with Kacific to determine the specific terms on how the company can boost the country’s digital capability,” the Palace said.

Information and Communications Technology Secretary Ivan John E. Uy said Kacific2 “could benefit the Philippines with additional bandwidth to help the economy through the propagation of the digital economy.”

The Palace said state-owned National Development Co. (NDC) is considering an investment in Kacific2 “through the acquisition of frequency block, including the naming rights to the broadband satellite.”

It said the NDC will partner with a Philippine company to roll out broadband satellite services from the Kacific2 to rural areas.

“Broadband services offered by Kacific2 could enable government-to-government communications from specific central offices to remote constituents and also support the existing government initiatives that promote better internet connectivity such as Free WiFi for All Program, the National Broadband Program, and the eGOV PH super app,” the Palace said.

Kacific Broadband Satellites, founded in 2013, aims to provide reliable, fast, and low-cost satellite internet to homes, businesses, and public agencies in the Asia-Pacific.

In 2019, the company launched Kacific1, a High Throughput Satellite providing high-speed, low-cost, and reliable broadband to rural and suburban areas of the Pacific and Southeast Asia. — Kyle Aristophere T. Atienza

PHL LPG import dependence expected to increase in 2023

August 2, 2023 | 8:36 pm

A man arranges tanks of liquefied petroleum gas (LPG) on a truck. — PHILIPPINE STAR/EDD GUMBAN

THE Philippine dependence on imported liquefied petroleum gas (LPG) is expected to increase further going forward, with the country becoming the second-largest LPG importer in Southeast Asia, Fitch Solutions BMI said on Wednesday.

“The Philippines is significantly exposed to the spot LPG market since the bulk of LPG is imported on a spot basis,” Fitch Solutions BMI Country Risk & Industry Research said in a report.

Fitch Solutions unit BMI said the country’s strong economic growth along with rising urbanization points to further growth for the LPG market in the Philippines.

BMI said LPG imports by the Philippines are expected to increase further to 55,000 barrels per day (b/d) in 2023 from 51,000 b/d in 2022.

“The dynamics of the LPG import market in the Philippines is changing fast with many industry players participating in import, wholesale and retail areas,” BMI said.

However, it cited the weakness of the transportation sector as a downside risk to overall LPG consumption.

The report said LPG is one of “promising energy sources” set for growth in the long run as the Philippines does not have many alternatives to imports.

“The Philippines with a population of 114 million will continue to present short- and long-term opportunities for LPG exporters and traders in view of strong LPG demand growth outlook and shortfalls in supplies,” BMI said.

BMI said that LPG use in the transport sector will likely fall further, with demand estimated to decrease to 100 b/d in 2022 from 1,200 b/d in 2015. It said that the transport sector only accounts for a small share of overall demand and consumption.

For residential and commercial use, LPG will likely be favored over liquefied natural gas (LNG), BMI said.

“Though the government is willing to develop the city gas market, the impact on LPG consumption will remain limited due to the lack of extensive city gas distribution infrastructure. More importantly, LNG may not be able to compete with LPG in residential and commercial sectors with LPG being more favored over LNG for commercial and residential use,” BMI said.

The Oil Industry Management Bureau of the Department of Energy estimates that in 2022, LPG demand was 3,418 million liters, against 3,272 million liters in 2021. Estimates for the first six months to June 2023 are not yet available.

Meanwhile, BMI said the residential and commercial segments are the growth drivers of the LPG sector, with commercial accounting for 89% of overall LPG consumption in 2022.

BMI estimates that the LPG consumption by the residential and commercial segments will likely account for about 92% of all consumption.

“Prospects for strong demand growth from residential and commercial sectors will continue to be supported by improving access to LPG, rising urbanization and a strong population and economic growth outlook,” the report said. — Ashley Erika O. Jose

PHL adds 58 new international weekly flights this year

August 2, 2023 | 8:36 pm

THE PHILIPPINES added 58 new weekly international flights this year, the Department of Tourism (DoT) said in a statement.

Citing data from its Routes Development report for June 2023, the DoT said on Wednesday that the international flights into Manila originate from Tokyo (seven weekly ZipAir flights) and Chengdu (two weekly Air China flights).

Increased services to Cebu include seven China Eastern Airlines weekly flights from Shanghai and four Philippine Air Asia weekly flights from Tokyo, two Cebu Pacific weekly flights from Taipei, and two additional weekly flights by Asiana Airlines from Incheon).

Two additional weekly flights to Bohol have been offered by Asiana Airlines and seven more by Air Busan, both originating from Seoul.

Kalibo has attracted three new weekly flights from Hangzhou, three from Ningbo, and three from Wenzhou, all by Loong Air; four from Chengdu by Ok Airways, and two from Taipei by TigerAir Taiwan.

Clark added seven Asiana Airlines weekly flights from Seoul; Caticlan three Royal Air weekly flights from Hong Kong; and Cagayan Province two Royal Air flights from Macau.

According to the DoT, eight of the country’s international gateways reported more incoming flights and seats each week.

In June, the DoT said Clark posted a 180% increase in incoming scheduled weekly frequencies and a 215% rise in incoming weekly seats. The corresponding gains for Manila were 75% and 120% respectively.

“In Visayas, Kalibo recorded a 640% increase in incoming frequencies and 409% increase in incoming seats, Cebu 300% and 297% (respectively), and Bohol 200% and 128% (respectively),” the DoT said.

“Davao saw a 50% increase in incoming frequencies, and 38% increase in incoming seats,” it added.

The DoT said domestic air seats also increased due to new routes and the resumption of services.

“The industry gained from at least 17 city pairs, with about 83 incoming weekly frequencies that were launched between July 1, 2022 to June 30, 2023. This includes new domestic air routes that were instituted during this period, including flights between Cebu-Baguio (4 frequencies per week), Cebu-Borongan (2 frequencies per week), and Cebu-Naga (4 frequencies per week),” the DoT said.

“Among the domestic flights that resumed in the same period were: Clark to Bacolod, Busuanga, Cagayan de Oro, Caticlan, Davao, Iloilo, General Santos, and Puerto Princesa; Manila to Tablas and Lal-o; Davao to Bacolod, Cagayan de Oro, and Siargao; and Zamboanga to Cotabato,” it added.

For 2023, the DoT is targeting 4.8 million international arrivals, against 2.65 million last year.

The Philippines has logged over 3 million international arrivals as of July 19. — Revin Mikhael D. Ochave

Garment industry claims European customer cancels PHL orders due to absence of FTA

August 2, 2023 | 8:36 pm

garments-factory workers — RIO LECATOMPESSY-UNSPLASH

THE Confederation of Wearable Exporters of the Philippines (CONWEP) said a major European apparel brand canceled its Philippine orders because they are not covered by a free trade agreement (FTA) between the Philippines and the European Union (EU).

CONWEP Executive Director Maritess Jocson-Agoncillo told reporters on the sidelines of a briefing in Makati City on Aug. 1 that the orders were transferred to Vietnam and Cambodia.

She did not identify the customer.

She added that the absence of an FTA “is affecting us” in terms of foregone exports and job security of garment workers, Ms. Jocson-Agoncillo said.

Ms. Jocson-Agoncillo valued the lost potential exports at $200-$300 million each year and estimated the number of impacted workers at 4,800 to 6,000.

The resumption of FTA negotiations with the EU was announced on July 31 by President Ferdinand R. Marcos, Jr. and European Commission (EC) President Ursula von der Leyen.

Official FTA negotiations between the EU and the Philippines were launched in December 2015, with the last taking place in 2017. The FTA talks were delayed due to issues concerning intellectual property rights and data exclusivity, among others.

Trade Secretary Alfredo E. Pascual said preliminary talks on the FTA will begin in September, due for completion within the year. Formal negotiations are expected to begin by 2024.

The Department of Trade and Industry (DTI) has said that the average tariff for wearables exports is 12%.

Ms. Jocson-Agoncillo said Vietnam has an FTA with the EU and Cambodia has an Everything But Arms (EBA) agreement that removes all tariffs except for those on weapons and ammunition. Ms. Jocson-Agoncillo said.

Meanwhile, Trade Undersecretary Ceferino S. Rodolfo said during the International Tobacco Agricultural Summit in Taguig City on Wednesday that the Philippines could be a manufacturing hub for heated tobacco products (HTPs) if it harnesses FTAs.

“Through FTAs, the Philippines can serve as a manufacturing hub to supply HTPs to key markets,” Mr. Rodolfo said.

Mr. Rodolfo said that if manufactured in the Philippines, HTPs could be imported into ASEAN nations except Vietnam, as well as by Australia, New Zealand, Japan, South Korea, and Hong Kong, at zero tariff.

“Given single-digit growth of global demand for tobacco products and the foreseen reduction in local demand for conventional cigarettes, HTPs present a viable market opportunity and (potential source of) government tax revenue,” Mr. Rodolfo said.

“The Philippines is a global player when it comes to conventional tobacco products. While its footprint is currently small, opportunities to specialize and be globally competitive in emerging segments/high-tech products such as HTPs emerges,” he added.

He said companies are looking to tap the opportunities posed by HTPs.

“Multinational companies are actively exploring this opportunity in the Philippines. Philip Morris Fortune Tobacco Corp. is reported to have a plan to invest P9 billion in a state-of-the-art facility in Tanauan, Batangas that will produce HTPs for its IQOS devices,” Mr. Rodolfo said.

“Other potential leads may include Japan Tobacco International, British American Tobacco, China Tobacco and manufacturers of locally distributed HTP brands such as Bohem Cigar, Esse and Liqun,” he added. — Revin Mikhael D. Ochave

House plenary approves natural gas industry dev’t bill calling for zero VAT

August 2, 2023 | 8:36 pm

THE House of Representatives passed on third and final reading a measure outlining the development path of the downstream natural gas industry, which includes a provision calling for zero value-added tax (VAT) on the commodity.

At the Tuesday plenary session, 215 legislators voted yes and three no, with no abstentions.

The plenary also approved a bill creating a capital accounting system for valuing natural resources, as well as one regulating cooperative banks.

House Bill (HB) No. 8456 seeks to promote natural gas as an energy fuel, citing its potential to meet domestic fuel demand. It also seeks to position the Philippines as liquefied natural gas (LNG) trading and transshipment hub within the Asia-Pacific region.

The bill seeks to “provide a framework for the development of the Philippines’ downstream natural gas industry and its transition from an emerging into (a) mature industry within a competitive natural gas market.”

The measure aims to promote and speed up the exploration and development of indigenous natural gas resources and facilities.

The sale of natural gas will be subject to a zero percent VAT under the proposed law. Investments to convert facilities from oil and coal to gas will also be deemed as eligible capital expenditures under Section 294 (C) of the National Internal Revenue Code, which governs VAT zero-rating.

LNG terminals, downstream natural gas transmission and distribution systems will also be entitled to zero-rated VAT on local purchases of goods, property, and services needed for their facilities.

The proposed Philippine Downstream Natural Gas Industry Development Act will cover natural gas supply and aggregation, LNG bunkering, LNG storage and regasification terminals, conventional and virtual transportation systems, their related facilities, and end-users.

The bill is part of the common legislative agenda of the Legislative-Executive Development Advisory Council (LEDAC).

Legislators on Monday also passed a measure that will create the Philippine Ecosystem and Natural Capital Accounting System (PENCAS).

HB 8443 was approved with 215 legislators voting in the affirmative, zero opposed, and three abstaining.

PENCAS will result in the accurate valuation of natural resources and ecosystem services, permitting an improved picture of the impact of nature on the economy.

“The PENCAS framework shall include, among others, a list of the officially designated statistics on the depletion, degradation, and restoration of natural capital; environmental protection expenditures, pollution and quality of land, air and water; environmental damage, and genuine savings,” according to the proposed law.

The bill requires the Environment and Natural Resources department to report data to the Philippine Statistics Authority, while the Finance department will integrate PENCAS data into fiscal policy and regulations to promote investment in natural capital.

The bill is listed as a LEDAC common legislative agenda item, but is not a priority measure, according to the President’s State of the Nation Address.

Meanwhile, 206 legislators voted to approve a bill governing the registration, regulation and operation of cooperative banks, with none opposed or abstaining.

Under the proposed law, the Bangko Sentral ng Pilipinas will be the primary regulator of cooperative banks in accordance with the General Banking Law of 2000.

HB 8265 seeks to expand the membership of cooperative banks by opening them up to foreign cooperatives, whose ownership is capped at 40% of outstanding voting shares.

Registered cooperative banks will be granted incentives and privileges including tax exemptions, fees and charges under the cooperative code and related laws, and exemption from publication requirements on foreclosed land and from maximum landholding limits under the law.

President Ferdinand R. Marcos, Jr. has urged Congress to amend the cooperative code. — Beatriz Marie D. Cruz

Tobacco farmers push for higher floor prices

August 2, 2023 | 8:36 pm

TOBACCO FARMERS said they will seek higher floor prices to support domestically-grown leaf, as well as more support from local governments, ahead of a tripartite conference scheduled for October.

“The current price is P75 but considering the increase in imports, increase of labor kaya sana kung pwede hihirit pa kami ng taas kahit P5 sana (we will seek an increase of P5),” Saturnino Distor, president of the Philippine Tobacco Growers Association (PTGA), told reporters on the sidelines of the International Tobacco Agricultural Summit.

“Not just that, we will also ask (local government units) to provide stronger support for farmers,” he said.

It was unclear what floor price Mr. Distor was referring to. According to the National Tobacco Administration (NTA), floor prices are set for various grades of the three varieties of tobacco grown in the Philippines — Virginia, burley and native leaf.

Mr. Distor also asked for subsidies on fertilizer and incentives for farm workers.

The NTA estimates that tobacco production was 39.46 million kilograms in 2022, down 14.74%.

“Tobacco production is mostly dependent on climatic/environmental and biological factors during the growth and development of the tobacco plant and the demand of global and local markets,” the NTA said.

Manufactured and unmanufactured tobacco imports in 2022 amounted to 129.04 million kilograms, down 1.54% from a year earlier.

Rohbert A. Ambros, manager of the NTA regulation department, said that most of the tobacco in the market consists of imports.

“Manufacturers tend to import because there are grades of tobacco that cannot be produced locally so they have blend that with local so the taste can compete with international products,” he said.

Exports of manufactured and unmanufactured tobacco rose 4.69% to 79.02 million kilograms.

Mr. Ambros said that the tripartite conference will be held in the first week of October, with participation from farmers, buyers, and the NTA to set floor prices.

According to Mr. Ambros, the factors being considered for an increase in floor prices include the cost of fertilizer, pesticide, and fuel.

Mr. Ambros said that the NTA is targeting an increase of 12% to 46 million kilograms of tobacco this year. — Sheldeen Joy Talavera

Untaxed tobacco seen costing gov’t P30B this year

August 2, 2023 | 8:36 pm

FOREGONE REVENUE due to the illicit tobacco trade are expected to exceed P30 billion this year, the National Tobacco Administration (NTA) said.

“To estimate, I think (the losses) would be a little higher (than) P30 billion. That is the projection for this year,” NTA Regulatory Department Manager Rohbert A. Ambros told reporters on Wednesday.

The Bureau of Internal Revenue (BIR) has reported a shortfall in excise tax collection, mainly due to the illicit tobacco trade.

In May, the agency filed 69 complaints against tobacco traders for tax evasion, estimating the evaded taxes at P1.8 billion.

The BIR also filed in December a P1.2-billion tax evasion case against five vape traders.

NTA Public Relations Officer Freddie G. Lazaro said foregone revenue from the illicit tobacco trade is estimated at P16 billion so far this year.

“The illicit tobacco trade is very alarming. We are losing billions of pesos, more or less P16 billion for this year,” he said.

Mr. Lazaro said that untaxed tobacco is mainly circulating in southern Mindanao and the Visayas. — Luisa Maria Jacinta C. Jocson