LONDON/NEW YORK/WASHINGTON – With each day, evidence is mounting across the corporate world that the chaotic implementation of US President Donald Trump’s tariffs is translating into caution on Main Street.
The uncertainty brought by Trump’s threats of tariffs and his shape-shifting trade policies is starting to have a chilling effect across many industries, businesses warn, as consumers pull back on everything from basic goods to travel.
The president’s back-and-forth tariff moves against major trading partners have kept markets on edge, and prompted companies to warn they may have to raise prices, which could boost inflation and dent economic growth. The White House fired another salvo on Tuesday, when Trump said he would double the planned tariff on all steel and aluminium imports from Canada to 50%.
While Trump has said his policies could cause short-term pain, investor concerns about their economic fallout have intensified in the last two days. Those worries have translated into a market selloff that has wiped out nearly $5 trillion in market value from the S&P 500’s peak last month, when Wall Street was cheering much of Trump’s agenda.
“A market that was cruising has been disrupted by the White House,” said Patrick Kaser, portfolio manager at Brandywine Global. “The volatility is in part caused by the market’s uncertainty as to what the administration’s objectives are… why are we going after Canada, exactly?”
Even as markets have stumbled, CEOs have largely refrained from publicly criticizing Trump’s trade policies, instead citing “uncertainty” for ebbing confidence. Several of Trump’s economic advisers have alternated between downplaying the market’s concerns and stressing the need to reorient the economy toward domestic manufacturing, even if it causes near-term damage.
“The administration is saying this is a blip or whatever,” said Byron Callan, managing director at Capital Alpha Partners. “There’s maybe this willingness to just kind of punch through and try and prove markets are wrong. But that can carry a lot of risk … it’s the judgment of a small group of people against the judgment of millions of people.”
Speaking after the market close on Monday, Delta Air Lines CEO Ed Bastian warned that economic worries among consumers and businesses were hurting domestic travel, without referencing tariffs directly. He noted several sectors were showing softness, including autos, technology, media, and aerospace and defense.
Several other airlines warned of softness in U.S. spending on Tuesday, sending shares of those companies, along with cruise operators and entertainment giant Walt Disney Co lower. Shares of Apple, the world’s most valuable company, touched a five-month low.
“Economic uncertainty is a big deal,” American Airlines CEO Robert Isom said at a JPMorgan industry conference.
LATEST TARIFFS
The latest round of Trump tariffs – 25% levies on imported steel and aluminum – kick in on Wednesday. They will apply to millions of tons of steel and aluminum imports from Canada, Brazil, Mexico, South Korea and other countries that had been entering the U.S. duty-free under previous carve-outs.
Trump vowed the tariffs will be applied “without exceptions or exemptions” to try to aid the struggling U.S. industries. He said on Tuesday that his latest move against Canada was because the province of Ontario imposed a 25% surcharge on electricity it exports to the United States. Ontario froze that plan on Tuesday afternoon.
In a post on Truth Social, Trump also threatened to “substantially increase” tariffs on cars coming into the United States on April 2 “if other egregious, long time Tariffs are not likewise dropped by Canada.”
Ahead of these measures, a range of recent surveys of U.S. businesses and consumers has shown deteriorating sentiment, which, if sustained, could hamper investment and household spending.
The National Federation of Independent Business – a Washington lobby group whose members staunchly supported Trump in the 2024 election – reported small business sentiment weakened for a third straight month, erasing the bump from Trump’s election victory.
“The mere risk of severe policy changes reflected by this uncertainty is enough to have an impact on the economy, even in the absence of any actual policy changes,” said Rogier Quaedvlieg, ABN Amro’s senior U.S. economist.
SOUNDING THE ALARM
U.S. businesses broadly had greeted Trump’s election with optimism, fueled by pledges of deregulation and tax cuts. Instead, they have spent the early part of the year talking about tariffs, as more than 900 companies out of the largest 1,500 have discussed the topic since January 1, according to LSEG data.
At the same time, Republicans in Congress have yet to agree on a plan that would allow them to cut taxes and instead are focused this week on averting a government shutdown when funding expires at midnight on Friday.
Carsten Knobel, CEO of Germany’s Henkel HNKG.DE, which makes Sellotape and Schwarzkopf hair products, said on Tuesday that he sees a “reluctance” in the United States for both consumer and industrial segments, citing the White House’s policies.
“What’s the end game? What’s trying to literally be accomplished with these tariffs? It hasn’t been explained to us,” said Robert Pavlik, senior portfolio manager at Dakota Wealth. “How can you model out for projections when you don’t know what the goals are?” — Reuters
Globe’s senior leaders actively shaped the global discourse on digital transformation at the Mobile World Congress (MWC) 2025 in Barcelona. Participating at various high-level discussions, the Globe executives were able to drive innovations through solutions that address challenges relevant to emerging markets like the Philippines.
Held in Barcelona last week, MWC is the world’s premier ICT event, uniting the industry behind the advancement of business and society. Globe CEO Ernest Cu was joined by Deputy CEO Carl Cruz and other senior leaders on a hectic week of engagements with global telco leaders to tackle the most pressing concerns facing the industry today.
Cu represented Globe in signing a Memorandum of Understanding with other Philippine telco operators on the deployment of federated CAMARA APIs under GSMA’s Open Gateway initiative.
Through CAMARA APIs, Globe will be able to improve security measures against fraud. These standardized APIs will also make it easier for businesses to create and expand digital solutions across telco networks. The partnership will also help fintech, e-commerce, and other digital services grow by turning telecom networks into platforms that developers can easily use, ensuring wider reach and smoother integration.
“Globe remains dedicated to advancing digital innovation while prioritizing customer security. This partnership marks a major step in enhancing fraud prevention and identity verification in the Philippines. By leveraging GSMA Open Gateway and federating CAMARA APIs, we can create a safer and more seamless digital experience, empowering both businesses and consumers in today’s fast-evolving digital landscape,” Cu said.
Cu also participated in his first GSMA Board Meeting and spoke about Globe’s best practices in combatting digital scams and fraud.
Cruz, meanwhile, shared insightful perspectives on the impact of 5G-A×AI on the future of connectivity at the GTI Summit 2025 as a session speaker.
The Summit revolves around the 5G-A×AI 100 Commercial Campaign that aims to engage 100+ partners, open 100+ APIs, and develop 100+ lighthouse projects, over the next three years.
“Globe is focused on strengthening connectivity, driving inclusive growth through initiatives like JuanSim ng Bayan, expanding 5G access, and making fiber internet more affordable. By working closely with industry partners and the government, we are building a future where every Filipino can fully participate in the digital economy and benefit from AI-driven innovation,” he said.
At the GSMA SEC CON 2025, Atty. Irish Salandanan-Almeida, Chief Privacy Officer and VP for Governance, Risk, and Compliance outlined the company’s proactive measures to address digital scams and fraud.
“Fraud has become more sophisticated, leveraging AI and multi-channel exploitation. We are taking a proactive stance by working closely with financial institutions, regulators, and law enforcement agencies to identify and prevent scams before they impact consumers,” she said.
Anton Bonifacio, Globe’s Chief Information Security Officer and Chief AI Officer, and Darius Delgado, Globe’s Chief Commercial Officer, also took part in multiple side events, including the Amdocs podcast.
Bonifacio talked about Globe’s proactive efforts to beat evolving scam methods. Globe was the first telco in the world to block all person-to-person SMS with clickable links– a security measure enforced in September 2022 amid a spate of scams targeting mobile users.
It has also forged data sharing agreements with major banks and other financial institutions to facilitate more efficient and effective fraud detection, investigation, response and prevention.
Globe is also at the initial stages of implementing AI-driven cybersecurity solutions and strategies to combat increasingly sophisticated cyber threats.
“At Globe, we are relentless in our fight against fraud and cyber threats, leveraging a multi-layered approach that combines technology, intelligence sharing, and proactive security measures. With AI-driven solutions complementing our defenses, we remain committed to building a safer digital ecosystem for our customers,” said Bonifacio.
Rebecca Eclipse, Globe’s Chief Transformation and Operations Officer, delivered a talk on “Transforming Operating Model Towards Becoming the Most Reliable Service Provider,” sharing insights on Globe’s journey towards delivering superior customer experience. She highlighted Globe’s shift towards a more agile and customer-focused approach by simplifying processes, reducing inefficiencies, and fostering cross-functional collaboration.
“We cannot adopt a single, one-size-fits-all strategy nationwide. It is imperative to know our customers and the landscape in each territory to provide them the right experience. We started transforming our operating model and ourselves. We brought more of our people on the ground, all united towards delivering better network experience, improving NPS, and with it, increasing revenues,” said Eclipse.
In pilot areas, Globe’s streamlined approach resulted in faster site deployment and improved network coverage. This transformation has strengthened customer trust, thus contributing to improved revenues, and underscoring further Globe’s commitment to innovation and exceptional service delivery.
Globe also participated in the GSMA MOU Signing Ceremony, strengthening collaboration with global industry players to promote AI and cybersecurity.
On the other hand, Delgado shared the telco’s commitment to digital inclusion, network expansion, and strategic partnerships, ensuring that its services remain relevant, accessible, and impactful.
“We are deeply invested in delivering meaningful experiences that go beyond connectivity. By leveraging AI-driven personalization, optimizing operational efficiency, and unlocking new growth opportunities, we ensure that our services remain relevant and impactful for Filipinos. Our commitment is to empower individuals, businesses, and communities through innovation and a seamless digital experience,” he said.
Globe’s active presence at the MWC 2025 underscores its leadership in the Philippine telecom sector and its pivotal role in fostering digital inclusion whilst supporting the country’s digital transformation.
To learn more about Globe, visit https://www.globe.com.ph/.
Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.
Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.
By Luisa Maria Jacinta C. Jocson, Reporter
THE Bangko Sentral ng Pilipinas (BSP) could resume its easing cycle as early as its next meeting on April 10, its top official said.
BSP Governor Eli M. Remolona, Jr. said a rate cut is still “on the table” at the Monetary Board’s meeting next month, signaling “a few more” rate cuts for the rest of the year.
“Let me say that we see ourselves still on the easing cycle. We are expecting to cut a few more times this year. But how much, we haven’t determined,” he said at a forum.
Mr. Remolona also confirmed that the Monetary Board’s next meeting would be moved to April 10 from April 3.
“When we think we’re on track, more or less on track, we stay with baby steps, which means 25 basis points (bps) at a time,” he said.
The central bank unexpectedly kept rates steady at its February policy review, opting to keep the benchmark at 5.75%.
This after it delivered three straight 25-bp cuts at each of its meetings in August, October and December.
“If things look much worse than we thought — that’s what we call a hard landing — it can be up to 50 bps of a cut, even more, but as long as we’re more or less on track, it will be 25 bps at a time,” Mr. Remolona said.
However, a hard landing or a recession scenario is “highly unlikely,” he added.
The Philippine economy grew by a slower-than-expected 5.2% in the fourth quarter, bringing 2024 growth to 5.6%. The full-year growth was well below the 6-6.5% target.
This year, the government is targeting 6-8% growth.
Mr. Remolona said the central bank considers several scenarios in its policy decisions.
“There’s the baseline scenario, which is kind of saying we’ll cut by this many times the rest of the year. Then we have a hawkish scenario, which means fewer cuts. And then there’s the dovish scenario, which means more cuts than the baseline,” he said.
“We compare those three scenarios and how we see inflation evolving, how we see growth evolving. It’s a balancing act between inflation and growth and so we have to weigh the different factors.”
The BSP chief also noted they are still reworking the current models to account for risks.
At their February meeting, Mr. Remolona said “global trade uncertainties” were the primary reason behind the policy hold.
“There are still a lot of numbers to look at. Of course, we’re recalibrating our models to take account of uncertainty,” he said.
Headline inflation sharply eased to 2.1% in February from 2.9% in January and 3.4% a year ago.
The February print was also below the 2.2%-3% forecast from the central bank.
“We did miss the inflation number on the low side, lower than the bottom of our range. If we’re going to miss it, that’s the way to miss it, right? So, we’re happy about that miss,” Mr. Remolona said.
“Then we’ll look at all the other numbers, and then we’ll decide on April 10 whether to ease further or not to ease.”
FURTHER RRR CUTS?
Mr. Remolona also cited the possibility of another reserve requirement ratio (RRR) cut, possibly within the year.
Asked if the BSP could slash reserve requirements again before the year ends, he said this was “possible.”
“For me, 5% is still high. But I’m just one vote. We’re seven on the Monetary Board. But it can’t be sudden because we need to control the liquidity that’s coming out,” he added.
The RRR of universal and commercial banks and nonbank financial institutions with quasi-banking functions will be reduced by 200 bps to 5% from 7% later this month.
Digital banks’ RRR will also be cut by 150 bps to 2.5%, while the ratio for thrift lenders will be lowered by 100 bps to 0%.
Rural and cooperative banks’ RRR has been zero since October, the last time the BSP cut reserve requirements.
Big banks’ RRR can be brought down to zero eventually, Mr. Remolona said. “It can be zero. In the US, the RRR is zero.”
The BSP chief said there is a “subtle difference” between the policy rate and reserve requirement. Reducing either one stimulates the economy, he said.
“But the policy rate, there’s a kind of cycle, you don’t want to lower it and then raise it the next time. You want to just keep going in baby steps.”
“The reserve requirement, you can just stop. You lower it, that’s it, and then there’s no kind of cycle that you have to worry about. The markets are disrupted when you change the cycle, especially with the policy rate.”
EYE ON PESO
Meanwhile, Mr. Remolona said they are closely monitoring the movements of the peso.
“We always worry about the exchange rate. But not for the reasons other people worry about the exchange rate. We worry about the exchange rate because if it moves too much, especially when it weakens, it can be inflationary.”
The peso closed at P57.225 per dollar on Tuesday, strengthening by 18.5 centavos from its P57.41 finish on Monday.
The peso had been under pressure late last year, falling to the record-low P59-per-dollar level thrice.
“We monitor the exchange rate. But not because we want the peso to stay low or to stay high. We monitor it because of the possible inflation consequences,” he added.
Mr. Remolona also clarified how the central bank manages its gold reserves.
“Gold as an asset, it’s a very poor investment. The return is negative because it has custody fees. Our gold is in the Bank of England, we pay there so they can store our gold. That’s where the market is,” he said in mixed English and Filipino.
“But it’s very volatile. So, by itself, it’s a very poor investment. It’s risky and the average return is negative.”
Latest BSP data showed the value of the central bank’s gold holdings went up by 2.5% to $12.5 billion at end-February from $11.75 billion a month ago. It likewise jumped by 16.6% from $10.34 billion in the same period in 2024.
“But if you hold it as a part of a large portfolio, and our portfolio is mainly dollar assets, it’s a good hedge… especially when there are geopolitical (uncertainties),” he said.
Mr. Remolona said the central bank sold gold reserves as prices of the precious metal increased, so the gold in the BSP’s reserves breached the “ideal ratio of between 8% and 10%.”
Most of the BSP’s gold reserves are in the Bank of England, with a small amount kept by the New York Federal Reserve.
PHILIPPINE BANKS’ asset quality worsened as the industry’s gross nonperforming loan (NPL) ratio rose in January, according to data from the Bangko Sentral ng Pilipinas (BSP).
Preliminary data from the central bank showed the bad loan ratio rose to 3.38% in January from 3.27% in December. This was the highest in two months or since the 3.54% in November.
However, this was lower than 3.44% in the same month in 2024.
Data from the central bank showed the amount of soured loans went up by 2.5% to P512.83 billion in January from P500.43 billion a month earlier.
Year on year, bad loans rose by 11.3% from P460.76 billion.
Loans are considered nonperforming once they remain unpaid for at least 90 days after the due date. These are deemed as risk assets since borrowers are unlikely to pay.
The total loan portfolio of the banking system stood at P15.18 trillion as of end-January, down by 1% from P15.32 trillion at end-December. Year on year, it jumped by 13.4% from P13.38 trillion a year ago.
Past due loans increased by 4.6% month on month to P633.07 billion from P605.22 billion. It likewise climbed by 10.8% from P571.56 billion a year earlier.
This brought the past due ratio to 4.17%, higher than 3.95% in December but lower than 4.27% a year ago.
Meanwhile, restructured loans inched up by 0.3% to P311.22 billion in January from P310.44 billion in December. It rose by 3.1% from P302 billion in January 2024.
Restructured loans accounted for 2.05% of the industry’s total loan portfolio, a tad above the 2.03% in the month prior but lower than 2.26% in January 2024.
Banks’ loan loss reserves amounted to P488.48 billion, up by 1.6% from P480.64 billion in December and by 5.7% from P462.12 billion a year ago.
This brought the January loan loss reserve ratio to 3.22% from 3.14% in December and 3.45% in the same month in 2024.
Lenders’ NPL coverage ratio, which gauges the allowance for potential losses due to bad loans, slipped to 95.25% in January from 96.04% in December and 100.29% in 2023.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the uptick in the NPL ratio reflects the continued growth in bank loans.
Latest data from the BSP showed bank lending jumped by 12.8% to P13.02 trillion in January, its fastest pace in over two years.
“The higher NPL in January may be reflective of higher loan demand during the holiday season up until the start of 2025 but I don’t think this is a cause for concern on liquidity,” Reinielle Matt M. Erece, economist at Oikonomia Advisory and Research, Inc., said.
“Slow economic growth that we saw in the last quarter may also be a cause of struggle in the repayment of these loans due to slow earnings growth,” he added.
The central bank’s rate-cutting cycle in the latter half of the year also bolstered demand for loans, Mr. Ricafort said.
The BSP began its easing cycle in August last year and slashed borrowing costs for three straight meetings, reducing the key rate by a total of 75 basis points (bps) by end-2024.
“The slight monthly pickup on NPL ratio may have to do with the seasonal slowdown in sales, earnings, and other business activities upon crossing the new year from the Christmas holiday season that is considered one of highest in sales for many businesses,” he added.
For the coming months, Mr. Ricafort said the recent cut in banks’ reserve requirement ratio (RRR) could infuse liquidity into the financial system and boost banks’ loans and investments.
Effective March 28, the BSP will cut the RRR of universal and commercial banks and nonbank financial institutions with quasi-banking functions by 200 bps to 5% from 7%.
It will also reduce the RRR for digital banks by 150 bps to 2.5%, while the ratio for thrift lenders will be lowered by 100 bps to 0%.
Rural and cooperative banks’ RRR has been zero since October, the last time the BSP cut the reserve requirements.
“We expect NPLs to improve in the remaining months of the year as interest rates go down and as faster economic growth supports higher incomes for consumers and businesses alike, helping them meet their obligations,” Mr. Erece added. — Luisa Maria Jacinta C. Jocson
TYPICAL HOUSEHOLDS in areas served by Manila Electric Co. (Meralco) can expect higher electricity bills this month as the power distributor is set to hike rates by P0.2639 per kilowatt-hour (kWh) due to higher transmission charge and feed-in tariff allowance (FIT-All).
The upward adjustment pushed the overall rate to P12.2901 per kWh in March from P12.0262 per kWh in February, the company said in a statement on Tuesday.
Households consuming 200 kWh will see their monthly electricity bills go up by around P53. Those consuming 300 kWh, 400 kWh, and 500 kWh will have to pay an additional P79, P106, and P132, respectively.
Meralco attributed the rate increase to the conclusion of the one-time refund on regulatory reset fee, equivalent to P0.2264 per kWh for its customers. The refund was implemented last month as ordered by the Energy Regulatory Commission (ERC).
Also contributing to higher rates was the P0.1294 per kWh increase in transmission charge due to higher ancillary service charges incurred by the National Grid Corp. of the Philippines. The transmission charge for March also covered the second of three monthly collections for the recovery of costs of reserve market suppliers.
The ERC directed the recovery of the remaining 70% of the reserve market settlement fees incurred in March last year. This will be reflected in customers’ bills until April.
Adding to the upward adjustment was the implementation of the new FIT-All rate of P0.1189 per kWh, which was higher than the previous rate of P0.0838 per kWh.
The FIT-All is a uniform charge billed to all on-grid electricity consumers to support the development and promotion of renewable energy.
Other charges, which included taxes, increased by P0.0416 per kWh.
“Such increases were mitigated by the lower generation charge for February supply month that impacted the March billings of Meralco customers. The reduction is almost 17 centavos per kWh in generation charge,” Joe R. Zaldarriaga, Meralco vice-president and head of corporate communications, said in Filipino during a briefing.
The generation charge fell by P0.1686 per kWh to P7.0517 from P7.2203 per kWh last month due to lower costs from Meralco’s supply sources.
The peso appreciation against the US dollar pushed down the charges from independent power producers (IPP) and power supply agreements (PSA) to P1.0143 per kWh and P0.2934 per kWh, respectively. Around 98% of IPP costs and 61% of PSA costs were dollar-denominated.
The peso closed at P57.995 on Feb. 28, strengthening by 37 centavos from its P58.365 finish on Jan. 31.
Charges in the Wholesale Electricity Spot Market (WESM), the trading floor of electricity, decreased by P0.2247 per kWh due to the improved supply situation in Luzon.
IPPs, PSAs, and WESM accounted for 31%, 47%, and 22% respectively of the company’s total energy requirement for the period.
“Pass-through charges for generation and transmission are paid by Meralco to the power suppliers and the grid operator, respectively; while taxes, universal charges, and FIT-All are all remitted to the government,” Meralco said.
The company’s distribution charge has not moved at P0.0360 per kWh since August 2022.
Lawrence S. Fernandez, Meralco vice-president and head of utility economics, said prices at the spot market might shoot up after the declaration of a yellow alert over the Luzon grid last week.
“Let’s see what will happen for the rest of the month. Demand has moderated a bit after that one time of yellow alert. So, we’ll have to see what the situation will be for the rest of the month,” he said.
Meanwhile, Mr. Zaldarriaga said Meralco’s energy requirements are fully covered by its suppliers as the summer season approaches.
“We entered into an emergency power supply agreement to cover our requirements, especially during peak load come the summer months. Although it has not been officially declared, we already feel the impact of the temperature levels on our demand,” he said.
“So, as long as there will be no unplanned and forced outages from the plants and as long as transmission will be able to supply the load coming from the power plants, we don’t see any problems come the summer months,” he added.
Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera
When RL Commercial REIT, Inc. (RCR) entered the market in September 2021, the real estate sector was grappling with the aftermath of COVID-19. The pandemic shook investor confidence, and demand for office spaces declined. Yet, RCR defied expectations.
Incorporated in 1988 as Robinsons Realty and Management Corporation, the company was renamed as RL Commercial REIT, Inc. before going public in 2021. RCR’s public offering raised approximately P23.5 billion, the largest REIT initial public offering (IPO) in the Philippines by far.
At the time of its listing, RCR’s portfolio includes 14 prime office assets. These include the 1. Tera and 2. Exxa-Zeta Towers in Quezon City, 3. Robinsons Equitable Tower, 4. Robinsons Cyberscape Alpha, and 5. Robinsons Cyberscape Beta in Pasig City, 6. Robinsons Cybergate Center 2 and 7. Robinsons Cybergate Center 3 in Mandaluyong City, 8. Robinsons Summit Center in Makati City, and 9. Cyber Sigma in Taguig City. The other office properties were 10. Robinsons Luisita BTS 1 in Tarlac City, 11. Robinsons Cybergate Naga in Naga City, 12. Robinsons Galleria Cebu and 13. Robinsons Cybergate Cebu in Cebu City, and 14. Robinsons Cybergate Delta 1 in Davao City.
Since then, it has significantly expanded its size and reach. In 2022, it added two properties in less than 18 months (ahead of its commitment per REIT Plan), followed by a major infusion in 2024 when it infused 13 additional properties.
RCR diversified beyond office spaces. Initially focused on office spaces, the company’s portfolio now includes 17 office properties and 12 malls across 18 key locations in the Philippines. This expansion brought its total assets to 29, with a strong occupancy rate of 96% as of December 2024.
Stability and sustainability
The growth trajectory of RCR hinges on an Investment Criteria. In determining future investment to expand RCR’s portfolio, the asset to be acquired or infused has to be yield-accretive, has three-year profitability history, has stable occupancy, has to be in a key location and accessible at the same time, has to have a healthy tenant mix (for offices, BPOs are key while for malls, retail affiliates and strong and expanding retail concepts are important), and to extent available, PEZA Registration is an advantage. Such factors ensure that any new asset infusion strengthens the company’s financial standing and enhances value for the shareholders.
RCR executed a landmark asset infusion in 2024. The 13 multi-asset infusion valued at P33.92 billion has been the largest single infusion done by any Philippine REIT company so far. The injection of the mall assets positioned RCR to become a multi-asset class REIT not only limited to offices. The variable rent structure of the malls signifies a potential upside to its current revenue. The malls are considered to be one of the stable real estate classes backed by high consumer spending.
RCR’s strengths also include stable occupancy rates. Both office segment and mall segment had steady occupancy rate of 96% as of December 2024. RCR’s tenant mix is primarily BPO for office segment and Retail Affiliates for its mall segment.
Strong investment option
RCR continues to establish itself as a stable and lucrative investment vehicle with consistently high dividend yields, a growing asset portfolio, and a track record of share price appreciation.
Investing in RCR gives opportunities for those looking for better returns than conventional money market instruments. Typically, a money market investment offers a return of around 6% per year. In contrast, RCR provides dividend yield of approximately 6.67% to 7.10%, making it a more profitable alternative. Dividend yield assumes a share price of P6.00 and following the total dividends per share declared by RCR for CY2024 totaling to P0.4001 without special cash dividends and P0.4261 including the P0.0260 special cash dividends. For instance, an investor who places P100,000 in a money market fund might earn P6,000 annually. Investing the same amount in RCR yields approximately P6,670 to P7,100 in dividends. RCR’s share price has also shown upward momentum, increasing from P5.85 (as of Dec. 27, 2024) to P6.20 (as of Feb. 28, 2025).
If one is an investor of RCR since it went public in 2021, the change in share price, as well as the total dividend earnings to date, results in an overall investment growth of more than 15% — a significantly higher return compared to traditional fixed-income instruments.
Continued growth
In just three years, the company has doubled its total gross leasable area (GLA) from approximately 425,000 square meters (sq.m.) to approximately 828,000 sq.m. This expansion ensures continued profitability for investors, aligning with RCR’s strategy to increase revenue-generating assets.
RCR’s market capitalization is around P97 billion as of Feb. 28, 2025, higher than the P64-billion market capitalization when it listed last Sept. 14, 2021.
RCR is continuously to be on the lookout for potential assets for acquisition. RCR’s Sponsor, RLC alone, currently has more than 1.3 million sq.m. of mall GLA, more than 250 thousand sq.m. office GLA, almost 300 thousand sq.m. of logistics and industrial facilities GLA, and approximately 4 thousand hotel room keys remaining for infusion. Aside from these, RCR is also on the watch for assets from third parties.
Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience by publishing their stories on the BusinessWorld Web site. For more information, send an email to online@bworldonline.com.
Join us on Viber at https://bit.ly/3hv6bLA to get more updates and subscribe to BusinessWorld’s titles and get exclusive content through www.bworld-x.com.
By Revin Mikhael D. Ochave, Reporter
PHILIPPINE CONGLOMERATES are projected to maintain stable earnings or achieve modest growth this year, as certain business segments face challenges from economic headwinds, according to analysts.
The real estate businesses of conglomerates could weigh on overall profitability, AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said in a Viber message.
“Most of the conglomerates have property development units, and this could drag on profits this year. Persistently high interest rates would also keep interest expenses elevated, further impacting the bottom line of conglomerates and possibly limiting their fund-raising,” he said.
“Overall, our conglomerates have proven to be resilient, so even if it’s unlikely that we’ll see remarkable growth this year, their earnings should at least be stable,” he added.
Luna Securities, Inc. Research Officer and Market Strategist Annika Gabrielle S. Angeles said conglomerates are expected to post moderate growth as they could benefit from possible interest rate cuts.
“While we expect these conglomerates to plod along with moderate growth, a half-percentage-point rate cut and improved consumer sentiment could provide a boost,” she said in a Viber message.
“Profit growth will continue to be difficult because of property, debt, interest rate effects, and shifting consumer habits,” she added.
The Philippine central bank unexpectedly kept rates steady last month after cutting rates for three consecutive meetings last year. Its next rate-setting meeting is on April 3.
Ms. Angeles said the ongoing surplus in the property market could dampen demand, hampering the performance of conglomerates’ real estate units.
“The property market is currently facing a significant surplus, particularly in Metro Manila, where most portfolios are concentrated. Property developers may see a decline in demand and price pressure as a result of this excess,” she said.
Sy-led conglomerate SM Investments Corp. recorded a 7% increase in its 2024 net income to P82.6 billion, as consolidated revenue rose by 6% to P654.8 billion, driven by stronger banking and property segments.
Lucio C. Tan-led LT Group, Inc. likewise grew its attributable net income by 14% to P28.92 billion in 2024, as revenue climbed by 11.9% to P129 billion, led by its banking and tobacco businesses.
On the other hand, Aboitiz Equity Ventures, Inc. reported a 23% decline in its 2024 net income to P18.1 billion after an asset impairment and a weak fourth quarter.
“In general, it should be better, especially for those conglomerates focused on banking and consumer businesses, because the outlook for economic growth is better this year due to lower inflation and interest rates,” COL Financial Group, Inc. Chief Equity Strategist April Lynn Lee-Tan said in a Viber message.
Other conglomerates, such as Ayala Corp., Ang-led San Miguel Corp., Gokongwei-led JG Summit Holdings, Inc., Andrew L. Tan-led Alliance Global Group, Inc., Gotianun-led Filinvest Development Corp., and Ty-led GT Capital Holdings, Inc., have yet to disclose their 2024 financial reports.
“The country’s biggest conglomerates recently posted new record-high earnings, with growth rates outpacing gross domestic product (GDP) growth, which could fundamentally support market valuations, especially if market conditions improve,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.
“Continued benign inflation amid faster Philippine GDP growth — among the fastest in ASEAN and Asia — would lead to further growth in sales and earnings, fundamentally supported by the country’s favorable demographics,” he added.
MAYNILAD Water Services Inc. said Tuesday that it spent P25.75 billion in 2024 to upgrade water and wastewater infrastructure.
“These infrastructure investments reflect our commitment to delivering safe and reliable water services while ensuring long-term sustainability amid growing demand and climate challenges,” Maynilad President and Chief Executive Officer Ramoncito S. Fernandez said in a media release.
“We remain focused on strengthening our operations and expanding access to clean water and sanitation for our customers,” he added.
The actual figure was lower than the P31 billion Maynilad had initially earmarked for the year.
Of the total capex, the company allocated P7 billion to improving the sewerage system, including constructing and upgrading wastewater facilities. Among these projects is the ongoing construction of water reclamation facilities in Caloocan and Las Piñas, both of which began last year.
Maynilad said it also upgraded seven wastewater treatment facilities in Muntinlupa, Pasay, Quezon City, and Manila to comply with the revised effluent standards (DAO 2021-19) of the Department of Environment and Natural Resources.
It allocated another P6 billion to its non-revenue water reduction program, which included replacing 142 kilometers of aging pipes in 2024. This initiative recovered 158 million liters of water per day, improving distribution efficiency and reducing water losses.
Additionally, Maynilad invested P6.5 billion in constructing and rehabilitating key water facilities, including the Poblacion Water Treatment Plant in Muntinlupa and the Parada Pumping Station in Valenzuela. It also expanded its pipeline network across the west zone, including laying pipelines in Morong, Rizal, in preparation for future water supply from Kaliwa Dam.
Meanwhile, P4.4 billion was allocated to developing small-scale water treatment facilities that tap alternative sources such as dams and rivers in Cavite province, ensuring a more resilient water supply.
The company also dedicated a portion of its 2024 budget to enhancing customer service and information programs.
In January, Mr. Fernandez said the company’s capex budget for 2025 could reach P30 billion or higher as it anticipates a stronger financial year.
Maynilad serves parts of Manila, Quezon City, and Makati, as well as Caloocan, Pasay, Parañaque, Las Piñas, Muntinlupa, Valenzuela, Navotas, and Malabon. It also supplies water to the cities of Cavite, Bacoor, and Imus, and the towns of Kawit, Noveleta, and Rosario in Cavite province.
Metro Pacific Investments Corp., which holds a majority stake in Maynilad, is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., alongside Philex Mining Corp. and PLDT Inc.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera
AUTHOR, curator, and art critic Cid Reyes has turned over cassette tapes of conversations with late renowned Filipino visual artists to the National Museum of the Philippines. As part of a museum project, the contents of the tapes are now available on YouTube.
The one-on-one interviews, some from 50 years ago, include conversations with National Artists Victorio Edades, Vicente Manansala, Hernando R. Ocampo, Napoleon Abueva, Arturo Luz, Jose Joya, and Ang Kiukok. Other renowned artists on the tapes are Anita Magsaysay-Ho, Mauro “Malang” Santos, Nena Saguil, Juvenal Sanso, and Pacita Abad.
“Lost Conversations,” an event held on March 7 at the National Museum of Fine Arts, formalized the turnover of the materials. It also marked the launch of ArticulatePH, a YouTube channel dedicated to the preservation of the oral history of Filipino visual art, where some of the digitized interviews have been uploaded for public access.
Mr. Reyes, who previously used many of these tapes as source material for his book Conversations on Philippine Art, published in 1989, told the press at the launch that documentation is just as important as the works themselves.
“I have always expressed my disappointment in having missed conversing with Fernando Amorsolo and Botong Francisco. I was able to talk to Professor Edades and that was really the start of this compilation,” he said.
He also explained that digitizing the interviews and putting them on social media through ArticulatePH is vital, as it is “the instrument for communication, for connecting, where there are interactions and contact with the global.”
“Even though we have what you call written history, written by historians after the fact, oral history which is history being lived at every moment, is history, as we say, straight from the artist’s mouth,” Mr. Reyes explained.
At the sidelines of the launch of “Lost Conversations,” the National Museum’s deputy director-general for museums Jorell Legaspi told BusinessWorld how meticulous the turnover process of the physical cassettes will be.
“It’s important for us to have a sit-down with Cid Reyes because, of course, he was a custodian of these tapes for such a long time. For us to continue that work is a very big responsibility because this is such a treasure trove of information,” Mr. Legaspi said.
He added that the tape’s previous storage conditions will inform the “short-term interventions” that the museum will have to do, under their dedicated conservation lab.
In attendance at the launch were officials from the Museum Foundation of the Philippines and heirs of some of the artists whose voices are on the tapes, such as Khristina Manansala and Diwa Abueva. The two granddaughters of National Artists, who are now artists themselves, praised the ongoing “efforts in preserving history for the future generations.”
The event also coincided with Mr. Edades’ 40th death anniversary. With this, Mr. Reyes shared an anecdote of going to Davao where Mr. Edades had retired in the 1970s.
“I was sent by my advertising agency to Davao. It was my opportunity. I looked for Professor Edades, not knowing where he lived. I asked a tricycle driver if he knew and, by some miracle, that driver changed the history of Philippine art and said yes!” Mr. Reyes said.
Their conversation that evening lasted six hours, from 6 p.m. until midnight, then Mr. Edades invited him to come back the next day. “So I came back and brought four cassette tapes. That started it all.”
As for the goal of having the recordings uploaded on ArticulatePH, Mr. Reyes said, “I want young artists to realize the real tradition that has been handed down to them. The value of oral history cannot be underestimated.”
The compilation of “Lost Conversations” is now available via https://www.youtube.com/@articulateph. — Brontë H. Lacsamana
AYALA LAND HOSPITALITY (ALH) said it plans to invest $500 million (around P28.63 billion) over the next five years to double its hotel room capacity to 8,000 by 2030, according to its chief executive officer (CEO).
“We will nearly double the size of our portfolio, close to 8,000 rooms by 2030,” George I. Aquino, president and CEO of Ayala Land Hospitality, said during a briefing on Tuesday.
“Our capex investment in the next five years is $500 million, and I think what we plan to do is really a combination of different types of hotels, expanding on our homegrown products, but also looking at other brands,” he added.
ALH, the hospitality arm of property giant Ayala Land, Inc. (ALI), has over 4,000 rooms across its homegrown brands, including Seda Hotels, El Nido Resorts, and Huni Lio, as well as international luxury brands such as Raffles Makati, Fairmont Makati, and the upcoming Mandarin Oriental Makati.
“In terms of financing, it’s a mix of debt and equity. It’s been a very profitable business line for us, so depending on where we see things over the next few months, but it’s locked in our capex,” ALI Senior Vice-President and Leasing and Hospitality Group Head Mariana Zobel de Ayala told the briefing.
“[Our] first priority would be where we could add value to our estates, but the second priority is looking at areas where there are direct international flights,” Ms. Zobel de Ayala said.
The Philippine government is targeting 12 million tourist arrivals by 2028. In 2024, the country welcomed 5.95 million foreign visitors, up 9.15% from 5.45 million in 2023, data from the Department of Tourism showed.
While ALH is optimistic about the privatization of Ninoy Aquino International Airport, it is also banking on foreign tourist arrivals at airports in Mactan, Cebu, and Clark, to drive more visitors, Ms. Zobel de Ayala said
The company is also considering launching a new brand focused on a “mountain outdoor experience,” according to Ms. Zobel de Ayala.
“Similarly, we’re working on a product in Mactan, Cebu — a five-star, Filipino-anchored hotel, which again, is more of a beach location,” she said.
ALH is also planning to renovate Huni Lio Resort in El Nido, Palawan, and build a bar adjacent to the property.
“Our idea is to then take it to other beach destinations, tourism destinations, and even the city,” ALH Creative Director Paloma Urquijo Zobel de Ayala said.
In 2024, ALI recorded a 15% increase in net income, reaching P28.2 billion from P24.5 billion in 2023, driven by record-high revenue. — Beatriz Marie D. Cruz
