PEOPLE shop for Chinese Lunar New Year decorations in Yu Yuan Garden in Shanghai, China, Jan. 31, 2019. — REUTERS/ALY SONG
BEIJING – China on Friday kicked off its busiest annual period of mass migration with a record 9 billion domestic trips expected to be made during a 40-day travel rush around the Lunar New Year holidays, state media predicted.
That would be nearly double the 4.7 billion trips made during the so-called Spring Festival travel rush in 2023 when ultra-strict COVID-19 restrictions were abolished.
Millions of people will travel back to their home towns to reunite with families for the Lunar New Year, which falls on Feb. 10 this year, in the world’s largest mass migration each year.
About 80% of the 9 billion trips will be self-driving road trips, also a record, with the rest by rail, air, and water, Chinese state television CCTV reported.
Nearly 11 million train trips, the main mode of transportation in China, are expected on Friday. A total of 480 million trips will be made nationwide during the 40-day period, a 38% jump from 2023 and up 17% from 2019 before the pandemic.
Both railway travel and air travel skyrocketed on the first day of this year’s rush. Passengers struggled to get train tickets, even though China is home to the world’s largest high-speed network.
Miranda Guo, a 25-year-old cartoonist from a Hangzhou-based Chinese technology firm, was lucky to have secured a seat on a bullet train to Jinan. But that was only after forking out an additional 60 yuan, 13% of the ticket price, on an “accelerator package” offered by third-party booking apps.
“I think it’s hard to buy a ticket this year, with almost all my colleagues failing to get tickets. Many of them are still on waiting lists,” Guo said.
Air passenger trips are estimated to reach 2 million on Friday, CCTV reported. During this year’s travel rush, the number of trips made by air are expected to surge to 80 million, per China’s aviation regulator, up 9.8% from 2019.
Airports in China’s biggest cities Beijing and Shanghai will brace for heavy crowds.
Shanghai’s two airports Pudong and Hongqiao expect passenger traffic to surge 57.6% on year in the 40-day period while Beijing’s airports will see a more than 60% jump.
Overseas travel will also rise during the travel peak.
China’s aviation authorities have arranged more than 2,500 additional international flights to Asian destinations including Southeast Asia, Japan, and South Korea.
Additional railway and flights are also arranged for popular domestic tourism cities including Harbin in northeast China and Sanya, a popular tropical destination in the south. — Reuters
Winners of Globe's 'Teach Me How to Digi' TikTok contest receive their prize from Globe Chief Sustainability and Corporate Communications Officer Yoly Crisanto and Globe PR and Communications Strategy Head Liza Reyes. Also in photo are Team #Globe of Good Influencers Chuckie Dreyfus and Joj and Jai Agpangan.
Leading digital solutions platform Globe Group is set to transform the digital landscape for Filipino seniors with its innovative “Teach Me How To Digi” #SeniorDigizen Learning Session, set on Jan. 25 at the Skydome, SM North Edsa.
Gathering at least 220 senior citizens in half a day of enriching tech learning, the #SeniorDigizens event is backed by some of the biggest brands in tech and retail, and by senior citizen advocates from the government.
“It’s really very important that our senior citizens learn digital skills because in the future, a lot of services will truly become fully digital. We have to help the seniors overcome their fear. And I guarantee you that once you try it, it’s going to be as easy or much easier than the old manual way,” said Ernest Cu, Globe Group President and CEO.
Yoly Crisanto, Chief Sustainability and Corporate Communications Officer of the Globe Group, speaks at the “Teach Me How To Digi” Learning Session for Senior Digizens at the SM North Sky Dome.
“As digitalization accelerates, tech adoption should be simple and easy for everyone, no matter the age. Technology should not be intimidating or difficult for our seniors, and they should be able to enjoy its benefits. The goal of our #SeniorDigizens campaign is to equip them with knowledge that will help them adopt new tech and apps that address their day to day pain points,” said Yoly Crisanto, Chief Sustainability and Corporate Communications Officer of the Globe Group.
The event features learning sessions on digital skills: How to create a Gmail account to be facilitated by Google, a 101 course on using smartphones via Globe, and sessions on using fintech platform GCash and telehealth service KonsultaMD.
Apart from hosting the event at Sky Dome, retail giant SM is providing an opportunity for senior citizens to join the Super Grannies Club (SGC), the grandest Facebook community for seasoned individuals. As SGC members, participants gain early access to events, exclusive mall deals and updates on SM Cares programs. These include health and wellness activities like Walk for Life, the award-winning Emergency Preparedness Forum and community service programs that enable a fun, active and productive lifestyle for lolos and lolas.
SM’s loyalty program SMAC, meanwhile, sponsored the event in SM Malls, as it is one with Globe in giving importance and joy to senior citizens.
“We are happy to support Globe in bringing to fruition our shared vision of digitalizing seniors. SM has long given seniors priority in our initiatives, and so our partnership with Globe for the #SeniorDigizens campaign is natural and seamless,” said Jay Beltran, Head of Sales and Marketing, Digital Advantage Corporation (DAC).
The National Commission of Senior Citizens (NCSC), led by its Chairperson and CEO Atty. Frank Quijano, has a booth where seniors will be guided on how to register in its database, which the agency hopes to build to take stock of the living situation, health concerns, skills and other important information about the country’s roughly 11 million senior citizens. The NCSC will also bring volunteers to help seniors in tech tutorials.
“We thank Globe for embarking on this program that addresses major concerns when it comes to seniors: digitalization and online safety. We at NCSC have been pursuing our own efforts to bring the elderly into the digital space safely, and we are happy to find an ally in the private sector to introduce seniors to new technologies while at the same time protecting them from the dangers that lurk online,” Atty. Quijano said.
Rep. Milagros Aquino-Magsaysay of United Senior Citizens Partylist is also on board, bringing senior citizen delegates to the event.
“We’d like to congratulate Globe for giving seniors priority through its #SeniorDigizens campaign. This is an initiative worth emulating. United Senior Citizens Partylist is one with Globe in seeing this through,” said Ms. Aquino-Magsaysay.
The Quezon City government also brought a delegation of senior citizens to the event and provided crucial logistics support.
“The city government of Quezon City is proud to partner with Globe in this undertaking. In QC, we give our seniors top priority in terms of public services to help them live their sunset years as active and productive members of society. This project is key in helping them transition into a digital life and help them enjoy the benefits of modern technology,” said Quezon City Mayor Joy Belmonte.
Meanwhile, #TeamGlobeofGood influencers Kiray Celis and Chuckie Dreyfus are lending their talent and bringing entertainment to the event, while internet personality Lester “Buji” Babiera, a talent of Globe Group agency NYMA, is bringing his brand of dynamic hosting onstage.
The #SeniorDigizen learning session, a significant effort to close the digital divide for the elderly, follows the success of the “Teach Me How to Digi” TikTok contest held in September last year. The contest received over 200 impressive videos showcasing tech lessons imparted by younger family members to their senior loved ones.
At the event, Globe will award 25 winners with prizes worth P25,000. They will also get to take part in the learning session.
“We are excited to help our senior citizens take their first steps into the digital world, ensuring they are not left behind in this fast-paced digital era. This event is our commitment to ensuring that they are not just consumers of technology but actively engaged in the evolving tech-savvy society,” said Liza Reyes, Public Relations and Communications Strategy Head at the Globe Group.
Globe’s #SeniorDigizens campaign promises not only to educate but also inspire a new generation of empowered seniors, ready to engage and connect in today’s rapidly evolving digital environment.
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MYANMAR’s former leader Aung San Suu Kyi — REUTERS
A court in military-run Myanmar has put up for auction the villa where ex-leader and democracy icon Aung San Suu Kyi spent 15 years under house arrest, and set starting bids at 315 billion kyats ($90 million), a source said on Thursday.
Suu Kyi, back in detention since the military overthrew her government in 2021, has been embroiled in a decades-long legal dispute with her brother over ownership of the lakeside villa.
A person with knowledge of the proceedings said the court-ordered auction will be held at the house on March 20.
“If there is a buyer, the house will be sold. We will have to see whether there will be a buyer or not,” added the source, who declined to be named as they were not authorized to speak to the media. Court officials were not available for comment.
The Nobel laureate was detained at the decrepit, colonial-style residence on Yangon’s Inya Lake until 2012, when she moved to the capital Naypyitaw to attend parliament after her release.
She gave impassioned speeches to crowds of supporters over the metal gates of the house and it has been the site of some of her most high-profile meetings, including with former US president Barack Obama and secretary of state Hillary Clinton.
The 78-year-old’s estranged brother, Aung San Oo first sued in 2000 for a share of the property, which is registered under the name of their mother, Khin Kyi.
The court ruled the siblings must share the proceeds from any sale of the house. Aung San Oo, was not immediately available for the comment.
Suu Kyi remains in detention, though her whereabouts are unknown. She faces 27 years in prison convictions for crimes ranging from treason and bribery to violations of the telecommunications law, allegations she denies.
World leaders and pro-democracy activists have repeatedly called for her release. — Reuters
Apple on Thursday outlined its plans to allow software developers to distribute their apps to users in the European Union outside of Apple’s own App Store.
The move is in response to a new EU law called the Digital Markets Act (DMA), which requires companies with more than 45 million monthly active users and a 75 billion-euro ($82 billion) market capitalization to, among other things, make their apps compatible with those of rivals and let users decide which apps to pre-install on their devices.
Starting in March, developers will be able to offer alternative app stores on iPhones and opt out of using Apple’s in-app payment system, which charges commissions of up to 30%. However, developers will still have to submit apps to Apple for review for cybersecurity risks and obvious fraud, and Apple will charge a “core technology fee” to major app developers even if they do not use any of Apple’s payment services.
Tim Sweeney, chief executive of “Fortnite” creator Epic Games, which pursued an antitrust case against Apple in the United States, criticized Apple’s planned changes as “hot garbage” and said he does not believe the moves are legal under the DMA.
“Apple proposes that it can choose which stores are allowed to compete with their App Store,” Sweeney said in a series of posts on social media platform X. “They could block Epic from launching the Epic Games Store and distributing ‘Fortnite” through it, for example, or block Microsoft, Valve, Good Old Games, or new entrants.”
Apple released tools on Thursday for developers to begin making changes to their business arrangements, and consumers will see the changes with an update to the iOS operating system in March.
Firms such as Epic and Spotify Technology have for years said that Apple’s commissions and restrictions impeded their businesses. But in recent years, Apple’s once-monolithic App Store approach has become a patchwork of rules as the tech company responds to legal and regulatory challenge.
For example, earlier this month, Apple said it would alter rules around linking out of apps to third-party websites for payment in the United States to comply with a ruling in an antitrust suit brought by Epic. But Apple also said it will charge a 27% commission on proceeds of those link-outs, which, when combined with a typical 3% payment processing fee, means developers will receive few economic benefits.
In the EU, by contrast, developers will be able to use a third-party payment processor inside an App Store app free of charge. Apple will also let EU iPhone users select a default web browser and contactless payments app, which means EU users can make contactless payments without using the Apple Pay system.
But even if developers opt not use Apple’s App Store or payment system, they will still be required to pay a “core technology fee” of 50 euro cents per user account per year.
Apple said that only large developers will pay the fee, though it did not specify how many users will trigger the fee. The company said the first 1 million user accounts will be exempt and that it will not charge the fee to nonprofits, schools or governments. — Reuters
A SWEDISH FLAG hangs outside a store on a busy street in Stockholm, Sweden, July 14, 2023. — REUTERS
ANKARA — Turkey’s president finally approved Sweden’s bid to join NATO on Thursday, ending months of delay and leaving only Hungary standing in the way of Stockholm’s membership of the military alliance.
Tayyip Erdogan signed off on the Turkish parliament’s earlier ratification of the bid, the presidency’s official gazette showed, about 20 months after Stockholm first asked to join NATO following Russia’s full-scale invasion of Ukraine.
“We welcome Turkey’s ratification of Sweden’s NATO application. We have now reached a decisive milestone on the road to full membership in NATO,” Swedish Prime Minister Ulf Kristersson said on social media network X.
“Only Hungary’s ratification remains before Sweden can become a member of NATO,” Swedish Foreign Minister Tobias Billstrom added on the same platform.
Turkey’s parliament ratification on Tuesday cleared the biggest remaining hurdle to expanding the Western military alliance.
The presidency’s communications directorate said Erdogan had “decided to publish the law” on Sweden’s NATO accession, passed by parliament, and signed a presidential decree approving Stockholm’s accession protocol.
The delay had frustrated some of Ankara’s allies but allowed it to extract certain concessions.
Ankara will now expect the United States to begin working on securing the US Congress’ endorsement for a sale of $20 billion worth of F-16 fighter jets to Turkey, which both Erdogan and members of Congress had linked to Sweden’s ratification.
Erdogan’s approval of the Swedish bid comes a day after U President Joe Biden sent a letter to leaders of key Capitol Hill committees, informing them of his intention to begin the formal notification process for the F-16 sale once Ankara completes Sweden’s NATO accession process.
Earlier, the US Ambassador to Turkey told Reuters that the State Department will immediately send Congress the notification once the instrument of ratification is received in Washington.
The final accession document from Ankara – the instrument of ratification – will now be sent to Washington as per NATO rules. — Reuters
EastWest Ageas CEO Sjoerd Smeets shares his vision for the company and how the Filipino customer is at the heart of it all
A premium on trust
Customer trust is one of the foundations of many businesses, particularly in insurance. Embracing digital transformation, adapting to regulatory changes, and addressing market volatility and competition are all factors that determine a company’s success.
This is the philosophy of Sjoerd Smeets as EastWest Ageas’ President and CEO. He believes trust will propel the company to newer, greater heights.
Mr. Smeets hopes to make a difference by building trust and open communication with consumers and within the company.
“One thing that stood out from my previous experience with a Dutch insurer: their line of trust was undeniable. It was evident from product development to customer communication,” he said in a BusinessWorld One-on-One interview.
Mr. Smeets makes it a point to visit financial advisors across the country. He does this to know more about the customers. “Visiting and talking to our advisors gives me additional insight,” Mr. Smeets said. “I always bring that back.”
“We listen to what our advisors say. Their feedback is crucial for us to know how we can improve the way we do things,” he added.
A need for education
In the first quarter of 2023, the insurance penetration rate in the country was only 1.75% of its economic output.
“I think the biggest issue that I see here in the Philippines is the level of financial literacy. It may also have to do with income level,” Mr. Smeets said.
“Currently, we engage our community on social media about personal finance tips, financial planning basics, and preparing for unexpected health emergencies. In this approach, we can help Filipinos learn and recognize that, while it may not appear necessary to get one right now, life insurance is essential to reach their long-term goals,” he added.
A purpose for society
Mr. Smeets admits that he was not initially interested in a career in the insurance industry. “Insurance was not particularly appealing when I started in the industry. People wanted to work for oil companies or major banks,” he stated. “But, over the years, I’ve realized that insurance is a critical industry.”
He pointed out that the insurance industry acts as a backbone for financial stability and risk management. It does so for both individuals and corporations. It enables both parties to manage risk by protecting against unanticipated events. These events might include accidents, natural catastrophes, or sickness.
“I learned to appreciate this industry because it adds so much value to society. That crystal-clear mindset is what I carry with me everywhere,” Mr. Smeets added.
You can view Mr. Smeets’ One-on-One interview on BusinessWorld’s Facebook and YouTube pages.
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THE HAGUE/DOHA/JERUSALEM — UN judges in The Hague will rule on Friday whether to order Israel to suspend its military campaign in Gaza as officials push ahead with efforts to negotiate a new deal for a ceasefire and release of more Israeli hostages.
On the ground in the seaside enclave, Gaza officials said on Thursday that Israeli strikes killed 20 Palestinians queuing for food aid in Gaza City, six people in a house in central Gaza’s Al-Nusseirat refugee camp and at least 50 people in the prior 24 hours in Gaza’s main southern city Khan Younis, where Israel is currently focusing the brunt of its might.
Reuters could not independently verify the details while Israel said it was either looking into the reports or did not immediately comment on the incidents.
The judges of the International Court of Justice (ICJ), also called the World Court, are due to rule on Friday on South Africa’s request for emergency measures against Israel in a case accusing it of state-led genocide in the Gaza Strip.
In more than three months of war, Israel’s campaign has leveled much of the enclave, displaced some 1.9 million Palestinians and killed at least 25,900 people, according to Gaza officials. Israel launched its offensive in October after militants from Hamas, which rules Gaza, stormed into southern Israel, killing 1,200 people and taking 240 hostages.
The court will issue its ruling at 1 p.m. (1200 GMT) in a hearing expected to last about an hour. While the judges will not rule on the merits of the genocide allegations, which may take years to decide, South Africa asked the court to issue an interim order compelling Israel to suspend its military operations.
Israel has called South Africa’s allegations false and “grossly distorted,” and said it makes the utmost efforts to avoid civilian casualties in Gaza.
The court’s rulings are final and without appeal, but it has no way of enforcing them. Israel on Thursday expressed confidence that the ICJ would “throw out these spurious and specious charges.” Hamas said it would abide by an ICJ ceasefire order if Israel reciprocates.
DIPLOMATIC EFFORTS SEEK NEW TRUCE DEAL
Meanwhile, diplomatic efforts to negotiate a break in the conflict continued. US and Israeli intelligence chiefs were due to meet Qatari Prime Minister and Foreign Minister Sheikh Mohammed bin Abdulrahman Al Thani in Europe this weekend, one official told Reuters. A second source said Egypt’s intelligence chief would also participate.
The White House has been trying to facilitate the release of the more than 100 remaining Israeli hostages taken during Hamas’ Oct. 7 attack on Israel, which ignited the war in Gaza, although there remains a considerable distance between the two sides’ demands.
A third source with knowledge of the talks said that Israel has proposed a 60-day pause in the fighting during which hostages would be released in phases, beginning with civilian women and children.
Previously, three sources told Reuters that shuttle diplomacy over the past month involving the US, Qatar, and Egypt has sought to hammer out a new deal for a ceasefire of about one month. But progress has been held up by differences between Hamas and Israel over how to bring a permanent end to the Gaza war.
In Gaza on Thursday, tanks hit areas around two hospitals in Khan Younis, forcing displaced people into a new desperate scramble for safety, residents said.
Israel’s military said early on Friday that its intelligence found that Hamas was operating from inside and around the two hospitals, Nasser and Al-Amal, in Khan Younis. Hamas and medical workers have denied Israeli claims that militants in Gaza use hospitals as cover for bases.
The Israeli military said it was coordinating with hospital staff to ensure they remain “operational and accessible” and there is a safe corridor for people to leave the hospitals.
“The facts on the ground disprove the blatant misinformation that has been disseminated over the last 72 hours falsely claiming that the hospitals are under siege or attack,” it said in a statement.
FLEEING TO RAFAH
On Thursday, thousands of homeless people sheltering in Khan Younis sought to flee to Rafah, 15 km (nine miles) away, the UN relief agency for Palestinians (UNRWA) said.
Video posted on X by Philippe Lazzarini, head of UNRWA, showed a crowd of people walking en masse on Thursday on a dirt road. “A sea of people forced to flee Khan Younis, ending up at the border with Egypt. A never ending search for safety that #Gaza is no longer able to give”, Lazzarini wrote.
The International Committee of the Red Cross said less than 20% of the narrow enclave – around 60 square kilometres (23 square miles) – now harbored over 1.5 million homeless people in the south. — Reuters
As the Philippine agricultural sector crumbles with fluctuating market prices, disproportionate wages, import threats, and technological gaps, the more crucial it is for public discussions to arise, all the more among the younger generation within the key agricultural hotspots like the Bicol region.
Padunungan 2024, the annual Battle of Intellects for Bicolano High School students kicks off again this Jan. 29-30 at the Bicol University College of Arts and Letters Amphitheater. With the theme, “Cultivating the Future: The Role of Filipino Youth in Philippine Agricultural Resilience,” the event aims to capture the complexities of the Philippine agricultural sector through various competitions and educational discussions for the youth. Each one tests the wit and passion of the younger minds as they interpret and express their heartfelt stances on these societal issues echoing them through the corridors of time.
More than an Inter-high Battle
This 2024 marks the 37th installment of Padunungan which takes its roots from 1981. From then, UP Ibalon, the sole regional organization for Bicolano students at the University of the Philippines, continued to realize its vision and mission of service to its home region through the event. While it struggled to continue during the height of the pandemic, it has reignited the flame of its advocacy last July 2023.
More than being a healthy competition, Padunungan prides itself in incorporating educational discussions that dissect every aspect of its chosen theme. With this year’s emphasis on Philippine and Bicol agriculture, the organizers ensured that all perspectives will be tackled ranging from the academic lens, the struggles and day-to-day living of farmers, and the situation of related industries like the coconut and bamboo. These topics will be the focus of the competition proper.
Multiple categories of creativity and intellect are set for the participants through the different individual events including the Tigsik Writing Contest, Poster Making, Essay Writing, Editorial Cartooning, Impromptu Speech, and Infographic Design. Group categories such as Short-Form Video Making, Debate, Cultural Presentation, and Quiz Bee, were also integrated to foster teamwork between participants as the battle towards agricultural resilience is not a singular effort but always a collective endeavor.
The Youth for the Youth
UP Ibalon was established by Bicolano UP students who persistently assembled students from the region during the height of Martial Law in 1974. Now on its 50th year, UP Ibalon commemorates its long journey of service rooted in our “Pusong Oragon” that defined our members’ excellence and competence as evident in our organizational activities and projects with the life-long goal of giving back to the masses, especially Bicolandia.
Kick-starting our golden jubilee year is Padunungan 2024, one of Ibalon’s flagship events, reflecting the Pusong Oragon as we reach beyond our campus walls toward young Bicolano students and build bridges for their paths for the future. For what better way to forward socio-cultural and socio-political awareness to the younger generation than through an organization also founded by dedicated and steadfast youth ready to impart social reform?
The increasing participation for Padunungan underscores not only the organization’s perseverance in cultivating public consciousness but also the Bicolano youth’s eagerness to understand and engage with these issues affecting them at diverse levels. Beyond the competition, this is a pursuit of social action. The true triumph lies not in the medals but in the awakening of a student’s mind towards societal discourse.
THE PHILIPPINE central bank is considering further easing documentary requirements for foreign exchange (FX) transactions through changes to its FX manual.
Under a draft circular posted on its website, processing of foreign currency loans, inward investments and other FX transactions filed with the Bangko Sentral ng Pilipinas-International Operations Department will be free of charge.
The central bank may verify if foreign exchange transactions and reports comply with the manual. “A violation of any of the provisions of the FX manual and/or the conditions imposed on the approval/registration/authority issued by the BSP may be grounds for cancellation,” it said.
Stakeholders have until Feb. 2 to comment on the circular.
The BSP monitors foreign portfolio investments registered with it through authorized agent banks and foreign exchange corporations.
Investments need not be registered unless the investor buys foreign currency from banks for conversion to pesos or earnings for remittances.
A BSP registration document must be produced as evidence of the registration of investments to the BSP.
In the draft circular, the central bank revised 15 appendices and annexes of the FX manual and removed the report on interim peso deposits of registered foreign investments.
Authorized agent banks must submit to the central bank a list of existing and valid registration documents within two weeks, the BSP said.
The central bank will give banks until Sept. 30 to continue reporting the transactions of registered investments using the old report forms.
Banks should also “make the necessary preparations and adjustments to their systems and processes to ensure compliance with the new reporting guidelines.”
The central bank is also considering allowing the sale of foreign exchange without the need for BSP approval for nontrade current account transactions.
Other changes include allowing banks and FX companies to sell foreign exchange to tourists or migrant workers returning to the Philippines, called “balikbayan” in Filipino.
“Departing nonresident tourists and balikbayans may reconvert at airports or other ports of exit unspent pesos up to a maximum of $10,000 (P565,000) or its equivalent in other foreign currency, calculated at prevailing exchange rates, without showing proof of previous sale of FX for pesos,” the BSP said.
It will also require the registration of debt securities issued by private sector residents.
This investment instrument falls under foreign direct or foreign portfolio investments depending on the degree of control or influence of the investor in the investee firm, the central bank said.
Debt securities are negotiable instruments such as notes, bonds and convertible notes that serve as evidence of a debt, it said.
“Nonparticipating preferred shares that pay a fixed income but do not provide for participation in the distribution of the residual value of an incorporated enterprise on dissolution, are also classified as debt securities,” it added.
The BSP has undertaken various liberalization measures to ease foreign exchange rules to facilitate transactions of banks, public and private companies, small and medium enterprises, overseas Filipinos and the public in general, it said earlier.
The liberalization is being undertaken in a well-calibrated manner, giving due consideration to prevailing domestic and international economic and financial conditions, while ensuring that timely prudential mechanisms such as documentary requirements and safeguard measures are in place, it added.
The Philippine central bank has approved and completed 12 rounds of FX policy liberalization since 2007. — Keisha B. Ta-asan
FOREIGN PORTFOLIO INVESTMENTS that left the Philippines outweighed those entering in 2023, as rising interest rates and elevated inflation dampened investor sentiment.
Data from the Bangko Sentral ng Pilipinas (BSP) released on Thursday showed foreign portfolio investments registered with the central bank through authorized agent banks posted a net outflow balance of $247.3 million (P14 billion) last year, from a net inflow of $886.7 million in 2022.
In December, the so-called “hot money” balance was a $205.18-million net outflow, a reversal of the $672.86-million net inflow a month earlier and $92.95-million net inflow a year ago.
Foreign portfolio investment is called “hot money” because of the ease with which they can enter or leave a jurisdiction, as opposed to foreign direct investment, which is considered less fickle.
Rising borrowing costs globally to combat inflation resulted in hot money outflows last year, particularly due to rate increases from the US Federal Reserve, Robert Dan J. Roces, chief economist at Security Bank Corp. said in a Viber message.
“This made holding assets in emerging markets like the Philippines less attractive to foreign investors, who could get higher returns in developed markets,” he added.
The US central bank hiked the Fed fund rate by 525 basis points (bps) from March 2022 to July 2023 to quell inflation. This brought the Fed’s key rate to 5.25-5.5%.
Concerns over a global recession, supply chain disruptions, geopolitical tensions and slower China growth also dampened investor sentiment last year, which deterred investments in emerging markets, Mr. Roces said. “Domestically, we had elevated inflation as the main challenge,” he said.
Inflation slowed to 3.9% in December from 4.1% in November, settling within the central bank’s 2-4% target for the first time in nearly two years.
But it averaged 6% last year from 5.8% in 2022, the second straight year that inflation breached the BSP’s 2-4% target.
“Add to this the widening current account deficit, which ballooned in 2023, reflecting strong import demand against weaker export earnings,” Mr. Roces said. “This raised concerns about the country’s external balance and potential currency depreciation, leading to some capital flight.”
The BSP posted a current account deficit of $10.9 billion in the nine months to September, equivalent to 3.5% of economic output.
BSP data showed gross inflows in December hitting $1.07 billion, 1.8% lower year on year, and 31.8% lower than a month earlier.
Over the full year, gross inflows increased by 4.5% to $12.89 billion.
Five countries accounted for 83.3% of short-term foreign investments in December — the United Kingdom, Singapore, the US, Luxembourg and Hong Kong.
About 53% of their investments went to Philippine Stock Exchange-listed shares of banks, holding firms, property, transportation and food producers. The remaining 47.1% was invested in government securities.
In December, gross outflows totaled $1.27 billion, up by 27.1% year on year and by 40.8% higher than November. This brought the full-year gross outflow to $13.13 billion, rising by 14.6% from a year ago.
While continued outflows are possible in the first half of 2024, a return to net inflows could occur if the global economic environment stabilizes and interest rate hikes slow down, Mr. Roces said. Net inflows are also possible if domestic inflation is brought under control and the current account deficit narrows, he added.
The BSP hiked borrowing costs by 450 bps from May 2022 to October 2023, bringing the key interest rate to a 16-year high of 6.5% to tame inflation.
BSP Governor Eli M. Remolona, Jr. earlier said the central bank is unlikely to cut borrowing costs at its meeting on Feb. 15 because rates need to be sufficiently tight amid evolving risks to inflation.
At the December meeting, the BSP’s risk-adjusted inflation forecast stood at 4.2% this year and 3.4% for 2025. Its average inflation baseline forecast is 3.7% for 2024 and 3.2% for next year.
The BSP expects hot money to post a $1.7-billion net inflow this year. — Keisha B. Ta-asan
THE INTERNATIONAL Finance Corp. (IFC) is investing $15 million (P849 million) in a fund that targets clean energy investments in the Philippines, Indonesia and Vietnam, the World Bank Group member said in a statement on Jan. 23.
The financing will support the Southeast Asia Clean Energy Fund II, which is managed by Singapore-based fund manager Clime Capital, it said.
The fund will invest in “utility-scale solar, wind and energy storage, in addition to helping businesses go to scale in areas ranging from rooftop solar, energy efficiency, electric mobility and grid management,” it added.
The partnership with Clime Capital would provide much needed capital to utility-scale clean energy startups and climate transition initiatives in the region, especially in Indonesia, Vietnam and the Philippines, IFC Vice-President of Industries Mohamed Gouled said in the statement.
“Private equity funds can play an important role in bridging the gap in financing early-stage climate infrastructure projects, advancing the energy transition and reducing greenhouse gas emissions along the way,” he added.
The IFC said its equity investment consists of $10 million from its own account and $5 million from the Finland-IFC Blended Finance for Climate Program.
The Southeast Asia Clean Energy Fund II mainly focuses on investments in the Philippines, Indonesia and Vietnam. Clime Capital earlier this week said it had raised $127 million in commitments for its first close of the fund.
It said the clean energy fund is the “first blended investment fund established in Southeast Asia (SEA) to provide early-stage high-risk capital to support promising businesses accelerating the region’s low-carbon transition.”
The first clean energy fund started in 2020 and has made 12 investments.
The fund has invested in the Real Wind Energy project in Quezon province in the Philippines, according to its website.
The project has a potential capacity of as much as 500 megawatts. Funding was used for the installation of meteorological masts, a grid impact study and an initial environmental impact assessment.
It has also invested in Skye Renewables Holdings, a Singapore-based clean energy developer that covers projects in the Philippines, Vietnam, Malaysia and Singapore. The fund’s investment has supported Skye Renewables’ deployment of clean energy solutions like rooftop solar installations.
As of end-2022, renewable energy accounted for about 22% of the Philippines’ power generation mix.The government wants to increase the share to 35% by 2030 and 50% by 2040.
“As time passes without sufficient progress in developing the critical resources to reduce carbon emissions, the planet needs more businesses focused on accelerating the low-carbon transition to thrive,” Clime Capital Chief Executive Officer and co-founder Mason Wallick said in the statement.
The fund is also backed by Allied Climate Partners, British International Investment, the Cisco Foundation, Australian Development Investments, the Netherlands’ entrepreneurial development bank FMO, the Global Energy Alliance for People and Planet, Impact Assets, Norway’s Norfund and Sweden’s Swedfund. — Luisa Maria Jacinta C. Jocson
THE PHILIPPINE Board of Investments (BoI) has endorsed Malaysia’s EDOTCO Towers, Inc.’s P150-billion telecommunication infrastructure project for green lane processing to fast-track the rollout of new technologies such as 5G mobile broadband networks.
In a statement, the agency said EDOTCO plans to roll out 25,000 common telecommunication towers that will be open for sharing by all mobile network operators.
“This strategic deployment spans urban and rural areas, addressing the needs of mobile network operators and aligning with government efforts to enhance mobile network access and internet penetration in underserved and unserved regions,” the BoI said.
In 2020, the Department of Information and Communications Technology released the guidelines for co-location and sharing of passive telecommunication towers.
The common tower policy seeks to widen the coverage and base of telecommunication providers to reach unserved and underserved areas.
A report by the EDOTCO Group and consultancy firm Roland Berger in 2022 projected the construction of as many as 30,500 shared towers in the Philippines by 2025, for a 10% penetration.
The BoI said the project would also form the basis for future mobile broadband networks in the country.
“The project will play a huge role in introducing new technologies such as 5G mobile broadband networks and large-scale Internet of Things applications through its shared infrastructure offered to service providers and government agencies with open access and on a nondiscriminatory basis,” it added.
Executive Order No. 18 created green lanes to expedite, streamline and automate processes for strategic investments.
It seeks to address barriers such as red tape, delays and additional requirements that hamper foreign direct investments.
“EDOTCO’s project will strengthen the telecommunication infrastructure in the country,” the BoI said. “It will attract more investors as connectivity is critical in supporting business operations.”
The Malaysian company is said to have plans to introduce green energy by tapping nonconventional energy resources such as photovoltaic systems, wind, biomass, fuel cells, energy storage systems and hybrid solutions.
“Energy costs are substantially reduced to the advantage of the mobile network operator, and this reduced consumption (on an aggregated basis) places less demand on the national grid,” the BoI said.
The project is also expected to boost the Philippine economy by creating jobs and facilitating the transfer of knowledge from multinational companies.
“Employment will not only come from the construction of infrastructure but from operations and maintenance as well,” it added.
Aside from EDOTCO, the BoI has endorsed other telecommunication infrastructure projects such as the P50-billion tower infrastructure project of Edgepoint Tower, Inc. in October and the P52-billion project of PhilTower Consortium, Inc.
EDOTCO is a unit of Malaysia’s EDOTCO Group Sdn. Bhd., which has more than 58,000 towers across nine countries.
Its business includes the construction of passive telecommunication towers and lease of towers to mobile network operators. — Justine Irish D. Tabile
UP Ibalon was established by Bicolano UP students who persistently assembled students from the region during the height of Martial Law in 1974. Now on its 50th year, UP Ibalon commemorates its long journey of service rooted in our “Pusong Oragon” that defined our members’ excellence and competence as evident in our organizational activities and projects with the life-long goal of giving back to the masses, especially Bicolandia.
