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Consumer pessimism persists in Q4; businesses upbeat — BSP survey

PHILIPPINE STAR/WALTER BOLLOZOS

Consumers remained pessimistic in the fourth quarter (Q4) due to elevated prices and lower salaries, a survey by the Bangko Sentral ng Pilipinas (BSP) showed.

The BSP confidence index (CI) among consumers decreased to 19% in the fourth quarter from a 9.6% contraction in the third quarter.

Rising prices, lower income, limited job opportunities, and doubts about the effectiveness of government policies on various economic aspects were the factors consumers attributed to their negative sentiment in the fourth quarter, the BSP said.

Consumers were more hesitant to buy big-ticket items in the fourth quarter this year, with the confidence index sliding to -71.3% from -62.7% in the third quarter.

“Consumer outlook is more pessimistic across the three component indicators and across income groups,” the BSP noted, adding that pessimism increased in low- and middle-income groups, while optimism turned into pessimism in the high-income group.

The BSP also observed a decrease in the percentage of households with loans and savings.

At the same time, the confidence index dropped to 5.6% for the first quarter of next year, down from the previous 7.8%.

Over the next 12 months, the index declined to 15% from 18.9%.

BUSINESS OPTIMISM

Meanwhile, the confidence index for businesses went up to 35.9% in the fourth quarter, up from 35.8% in the previous quarter.

The respondent companies were optimistic due to expectations of increased sales and production during the holidays, sustained economic recovery, business expansions in several sectors, development of new products and services, and expectations of robust consumer spending.

“However, the current quarter’s consumer index was tempered by concerns of pessimistic firms over the negative economic impact of the ongoing conflicts in Gaza and Ukraine, elevated inflation, and higher interest rates,” the BSP said.

The nationwide consumer survey response rate for this quarter was slightly lower at 97.4% from 97.6% in the previous quarter, the central bank noted.

Meanwhile, the business survey response rate increased to 65.1% from 64.9%.

According to the central bank, it interviewed 5,398 households for the survey conducted from Oct. 2 to 13 and 1,548 business owners for the survey held from Oct. 5 to Nov. 14.—Keisha B. Ta-asan

vivo brings heat to NBA 3X with V29 Series 5G plus thrilling on-court activity

Global smartphone leader and Official Smartphone of the National Basketball Association (NBA), vivo, brought the heat to the NBA 3X Philippines 2023, unveiling its V29 Series 5G and engaging basketball enthusiasts with thrilling on-court activity.

Celebrating a decade of basketball excitement, NBA 3X Philippines 2023 brought together players of all skill levels for a thrilling 3-on-3 basketball competition, showcasing the dynamism of the game. As the official partner and smartphone of the NBA in the Philippines, vivo showcased its commitment to blending technology and passion for sports.

The highlight of the event was vivo’s latest marvel, the V29 Series 5G – the Aura Portrait Master 2.0. Attendees had the opportunity to see its innovative features and sleek design that define vivo’s position at the forefront of smartphone technology.

Complementing the competition, vivo hosted the “Five-Man Standing Free Throw Edition,” a captivating on-court activity where participants competed for victory, with the last five standing receiving exclusive vivo premium belt bags.

At the event area, the vivo booth allowed attendees to experience the latest smartphone lineup, including the V29 Series 5G, Y36, Y27, Y17s, and Y02t, showcasing vivo’s dedication to delivering cutting-edge technology to its users.

The participation of vivo in the NBA 3X Philippines 2023 is just the start of a fruitful partnership. Soon, select vivo stores will feature dedicated NBA sections, providing fans with a unique space to indulge in NBA content, including live streaming of games and programming through NBA League Pass.

 

To elevate the excitement for NBA fans in the Philippines, vivo has launched captivating promotions, including the ongoing “Christmas Make a Wish” raffle promo. Until Jan. 31, 2024, participants can share their Christmas wishes for a chance to win three tickets to an NBA regular-season game, three autographed Wilson basketballs, and 50 codes for NBA League Pass. To join the promo and make your Christmas wish, visit www.vivoglobal.ph/what-is-your-christmas-wish.

vivo’s presence at NBA 3X Philippines 2023 underlines the brand’s dedication to seamlessly merging technology with the spirit of sports, providing an unparalleled and immersive experience for fans.

Official NBA merchandise is available at NBA stores at SM Megamall and SM Mall of Asia, as well as NBAStore.com.ph. For all the latest NBA news and updates, Filipino fans can visit www.nba.com, download the NBA App, and follow the NBA on Facebook, X, and TikTok.

For more information on vivo Philippines and its latest product offerings, visit vivoglobal.ph and follow the official vivo accounts on Facebook, X, Instagram, TikTok, and YouTube.

 

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Gift your loved ones with AXIS timepieces this Christmas

Known for high-quality, modern, and stylish timepieces, AXIS believes that a watch is more than just an accessory but an extension of one’s signature style.

Thus, it consistently comes out with classic and contemporary watches that will please even the most discerning of tastes. Adored by men and women of all ages, AXIS timepieces make for a great gift especially this holiday season. Incorporating Japan Made movement into each product and subjected to rigorous inspection, AXIS watches are always of the highest possible quality. Coupled with stylish, contemporary designs AXIS watches are the ideal everyday accessory, which can be easily matched with any outfit.

2Gether at AXIS  Christmas Town

To usher in the holidays, AXIS launched its Christmas Town Exhibit at The Block, SM City North Edsa. Just in time for this year’s celebrations, AXIS opened its Christmas Town to the public last November 30 at The Block, SM North Edsa. Guests were charmed by AXIS timepieces while enjoying family-friendly activities that evoke the fun, joyous spirit of the season.

Hence, the AXIS Christmas Town was created with the theme, “2Gether” in mind. More than being a catchy term, this evokes the enduring value of kinship, celebrated through the joy of giving. Guests present at the launch of the AXIS Christmas Town were able to experience all the fun that a holiday event can bring.

Celebrity and media guests such as Christine Samson, Bea Arboleda, Albert Nicolas and Evan Tan were delighted to see all the holiday themed activities and IG-worthy backdrops available in the event area.

AXIS WATCH and Hello Kitty 

Another notable highlight of the event was the launch of the highly-anticipated Axis x Hello Kitty collection. Guests were able to check out and try on the different AXIS’ Hello Kitty timepieces available at the event.

Incorporating sweet, girly details that evoke the enduring charm of Hello Kitty, each AXIS and Hello Kitty timepiece will delight Hello Kitty fans young and old. Make sure to check out AXIS latest collection today!

Discover a world of wonderful possibilities with AXIS timepieces. Known for its value-driven contemporary watches, AXIS gives its users the flexibility to showcase their style while having a practical, dependable everyday accessory.

As time is something to be valued and used to our advantage, wearing a watch has been a must for many. This Christmas time, gift yourself and your loved ones with a precious AXIS timepiece that will last you forever. Aside from being an important accessory, a watch also shows how much you value time spent with those you give it to.

Axis Watches are available at Watch Republic retail shops and SM stores nationwide

Shop online at https://www.watchrepublicshop.com/collections/axis.

 

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InLife’s Aguas underscores needed virtues and public-private partnerships for long-term progress

InLife Executive Chairperson Nina D. Aguas

Accountability, transparency, agility, consistency.

According to InLife Executive Chairperson Nina D. Aguas, these are needed to ensure that the country gets the investment support it needs, while improving the lives of its citizens and ensuring that the private sector flourishes.

Speaking as one of the panelists during the Partnerships for Long-Term Growth: Contributions of the Private Sector in Development Panel during the recently held Pilipinas Conference 2023, Ms. Aguas underscored the importance of these four virtues as driving forces towards a more progressive country.

She likened the experience to setting up a business in Singapore, where because of these four, businesses get established in merely hours.

“We talk about the ease and costs of setting up a business. There it only takes two hours to be able to start a business. It does not take days.” She adds that our processes need to be simplified. “(In the Philippines) the tax regime alone is too complicated. In Singapore, when filing your individual tax returns, you’re audited before you start to pay. And then you’re given a year to pay for the whole thing. It’s all technology-driven so that makes it a lot easier. It’s very transparent and the process is simple. I’d really like that for the Philippines.”

She further explains the importance of long-term investments to insurance companies such as InLife, the company she heads.

“We in the insurance industry, are natural aggregators of policyholders’ money that is invested long term. My challenge is, I don’t have enough investment outlets that will support yield and duration. If the corporates can give me that, welcome. And if the government can also provide us with investment outlets, then welcome. (Together,) we can stimulate the economy.”

The panel also discussed how the private sector can contribute to upscaling the educational system of the country. Aguas underscored the importance of being able to harness the best and the brightest among Filipinos.

“Truly, our educational system is not at par with the rest of some of the countries we’d like to benchmark ourselves against. If we are into nuclear in ten or twelve years, do we have the nuclear engineers to do it? I don’t think so. We should incubate some of the best and brightest Filipinos through a partnership between the government and the private sectors. Let’s train them so we have a pool of talent in the Philippines. Give them access to great education and training. We talk about upscaling and upskilling all the time, but it’s not targeted. And then we incentivize them enough so that they don’t leave the country. We have geniuses in the Philippines, but I don’t think we have such a targeted solution for educating some of the best in the country.”

On the topic of global risk and opportunities, Aguas highlighted the ever-evolving regulatory challenges. She added a possibility of another black swan, albeit a small one. To counter another black swan, she advocates for more support to the equities market.

“We don’t have enough public shareholdings. And there’s very, very low liquidity in our stock market. We say 20% should be publicly-held. That’s why if we want investors to come in, we have to provide that liquidity.”

Joining Aguas in the panel were Ayala Corp. President and CEO Cezar Consing, Microsoft Philippines CEO Peter Maquera, International Container Terminal Services EVP and Global Corporate Head Christian Gonzalez, and Acciona S.A. Regional Director of Infrastructure in SouthEast Asia Ruben Camba.  Panel moderator was Metro Pacific Investments Corporation’s Government Relations and Public Affairs Head Atty. Mike Toledo. The Pilipinas Conference 2023, held on November 22, 2023 at the Peninsula Manila, was organized and presented by think tank and research organization, Stratbase ADR Institute.

 

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BSP sees narrower 2024 current account deficit

REUTERS

The Philippines’ current account deficit is expected to narrow to $9.5 billion, or 2.0% of gross domestic product (GDP) in 2024 from the projected deficit of $11.2 billion, or 2.5% of GDP, this year, the central bank said on Friday.

The Bangko Sentral ng Pilipinas’ (BSP) previous forecast for 2024 current account balance was at $10.3 billion deficit, equivalent to 2.1% of GDP.

 It expects a balance of payments (BOP) surplus of $0.4 billion, or 0.1% of GDP next year, smaller than the $1 billion surplus, 0.2% of GDP, earlier projected.

For 2023, the BOP surplus is expected at $1.1 billion, or 0.2% of GDP.

“The current account is projected to remain in deficit for 2023, but with prospects of narrowing in 2024,” the BSP said in a statement, owing to a rebound in trade activity.

Steady inflows of overseas Filipino remittances, seen growing at 3.0% in 2024, will likewise help narrow current account gap, it added.—Reuters 

PHL converts $11.13-billion World Bank loans to fixed rate 

REUTERS

The Philippines has converted $11.13 billion worth of outstanding World Bank loans to fixed rate from floating rate, a move that could yield as much as $125.1 million in foreign interest payment savings, its finance ministry said on Friday.

The transaction, which was done last month, achieved an average fixed reference rate of 4.19% for the 40 International Bank for Reconstruction and Development loans, which is substantially lower than the prevailing rate, the Department of Finance said in a statement.—Reuters

October remittances hit 10-month high

Cash remittances from overseas Filipino workers (OFWs) rose by 3% in October, as migrant Filipinos sent more money home ahead of the holiday season.

Data from the Bangko Sentral ng Pilipinas (BSP) released on Friday showed cash remittances coursed through banks stood at $3 billion in October, higher than the $2.91 billion in the same month last year.

The amount of money sent by OFWs was the highest in ten months, or since the $3.16 billion in December last year.

Month on month, the 3% growth in cash remittances was faster than the 2.6% seen in September and marked the fastest pace in remittance growth since 3.7% in April.

“The growth in cash remittances in October 2023 was primarily due to increased receipts from both land- and sea-based workers,” the central bank said in a statement.

Land-based OFWs sent $2.4 billion in October, up by 3.1% from $2.33 billion in the same month last year.

Remittances from sea-based workers, on the other hand, rose by 2.5% to $600 million in October from $580 million a year ago.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said remittances typically increase in the fourth quarter due to holiday-related spending.

For the first 10 months of the year, cash remittances increased by 2.8% year on year to $27.49 billion.

The growth in cash remittances during the January-to-October period was driven mainly by inflows from the United States, Saudi Arabia, and Singapore.

By country source, the United States remained the biggest source of cash remittances at 41.5%. It was followed by Singapore (7%), Saudi Arabia (6%), Japan (5%), United Kingdom (4.8%), United Arab Emirates (4.1%), Canada (3.6%), Qatar (2.8%), Taiwan (2.7%), and Korea (2.5%).

Remittances from the top 10 countries accounted for 80% of the total during the 10-month period.

At the same time, BSP data showed personal remittances increased by 3.1% to $3.3 billion in October. This brought the 10-month tally to $30.57 billion, up by 2.9% from a year ago.

Mr. Ricafort said still-elevated inflation may have prompted migrant workers to send more money home to help their families cope with rising prices.

“OFW remittances have more peso equivalent for every US dollar sent, (which is) a source of consolation for OFWs and their families/dependents, especially in coping with higher prices/inflation, as well as to cope up with higher interest rate payments,” he said.

Headline inflation slowed to 4.9% in October from 6.1% in September, breaching the central bank’s 2-4% target for the 19th straight month.

In October, the Monetary Board raised borrowing costs by 25 basis points (bps) in an off-cycle move. This brought the benchmark interest rate to a 16-year high of 6.5%. The BSP has hiked interest rates by a total of 450 bps since May 2022.

Modest growth in cash remittances may continue in the coming months as families still need to cope with high inflation, Mr. Ricafort said.

The central bank expects remittances to grow by 3% this year. — Keisha B. Ta-asan

US regulators add artificial intelligence to potential financial system risks

STOCK PHOTO | Image by Rawpixel.Com from Freepik

WASHINGTON – Rapid adoption of artificial intelligence (AI) could create new risks for the US financial system if the technology is not properly supervised, a panel of regulators warned on Thursday.

The Financial Stability Oversight Council, which comprises top financial regulators and is chaired by Treasury Secretary Janet Yellen, flagged the risks posed by AI for the first time in its annual financial stability report.

While the group said AI could spur innovation or efficiencies at financial firms like banks, the rapidly advancing technology requires vigilance from both the companies and their watchdogs.

“AI can introduce certain risks, including safety and soundness risks like cyber and model risks,” the group said in its annual report published Thursday, adding it recommended firms and their regulators “deepen expertise and capacity to monitor AI innovation and usage and identify emerging risks.”

The panel also flagged the growing role of nonbanks and private credit as meriting close attention, and said financial institutions and regulators should continue to try to better gauge risks stemming from climate change.

Some AI tools can be hugely technical and opaque, making it hard for institutions to explain or properly monitor them for shortcomings. If companies and regulators do not fully understand AI tools, then it is possible they could miss biased or inaccurate results, the report said.

It also noted that AI tools increasingly rely on large external datasets and third-party vendors, which pose their own privacy and cybersecurity risks.

Some regulators including the Securities and Exchange Commission, which sits on the panel, are scrutinizing how firms use AI, while the White House recently issued an executive order aimed at mitigating AI risk.

Elsewhere in the report, the FSOC noted that the US banking system remains resilient, despite large bank failures this year. But it urged regulators to keep a close eye on uninsured bank deposits, the rapid flight of which triggered the failures.—Reuters

Canada to create citizenship path for undocumented immigrants- Globe and Mail

PRAVEEN KUMAR NANDAGIRI-UNSPLASH

Canada is planning a “broad and comprehensive program” that would allow many undocumented people to apply for permanent residency, the country’s Immigration Minister Marc Miller told The Global and Mail.

The announcement complements Canada’s ambitious immigration targets, which had already aimed to bring in 500,000 immigrants a year by 2025. The country’s population has grown mainly through immigration, and this has helped fuel economic growth in recent years.

An estimated 300,000 to 600,000 people are living in the country without valid documents, many of whom risk deportation because they lack formal status, The Global and Mail quoted Miller as saying.

The new program would also include people who entered the country legally, as temporary workers or international students, and then remained here after their visas expired, the report said.

Miller added that not all those without valid documents will be allowed to apply for permanent residency, including those who have arrived recently in the country.

He plans to submit a proposal to cabinet in the spring on allowing undocumented immigrants to “regularize their status,” the report added.

Amid the housing crunch and high inflation, the government last month kept immigration targets unchanged for the next two years and said it would stop ramping up immigration from 2026 onwards.

Canada is targeting 465,000 new residents this year, 485,000 in 2024 before hitting 500,000 in 2025 – a level it aims to maintain in 2026.—Reuters

Starbucks closed 23 stores to deter unionizing, US agency says

HENRY & CO.—UNSPLASH

A US labor agency is seeking to force Starbucks Corp. to reopen 23 stores that were allegedly shuttered last year to discourage a nationwide union campaign, the latest case to accuse the coffee chain of illegal labor tactics.

A regional director with the National Labor Relations Board (NLRB) in a complaint issued on Wednesday said that eight of the US stores had already unionized when they closed.

Workers at more than 360 of Starbucks’ 9,300 US stores have voted to join unions since 2021, and the company is facing more than 100 complaints at the NLRB alleging a variety of unlawful union-busting activity.

Starbucks has denied wrongdoing and said it respects workers’ rights to choose whether to unionize.

Starbucks in a statement on Thursday said it conducts annual reviews of its stores and routinely makes changes for a variety of legitimate reasons.

“This includes opening new locations, identifying stores in need of investment or renovation, exploring locations where an alternative format is needed and, in some instances, re-evaluating our footprint,” the company said.

The complaint claims that Starbucks closed the 23 stores without prior notice to Workers United, the union behind the campaign, and without affording the union an opportunity to bargain about the decisions, according to NLRB spokesman Matthew Hayward.

The agency is seeking an order requiring Starbucks to immediately reopen the 23 stores and re-hire employees, bargain with unions at stores that have unionized, and provide compensation to employees who lost pay and benefits, Hayward said.

The case will be heard by an administrative judge, whose decision can be appealed to the five-member NLRB and then to a federal appeals court.

The complaint came on the same day that Starbucks released a report on its labor practices prepared by an independent consultant, which had been requested by shareholders.

The report found that while there was room for Starbucks to improve its messaging on the union campaign, the company had not adopted “an anti-union playbook” that involved violating US labor laws.

An NLRB judge in July found that Starbucks had illegally shuttered a store in Ithaca, New York, months after it unionized. Starbucks is appealing that decision.—Reuters

Germany lifts spending freeze after budget deal clinched, document shows

FREEPIK

BERLIN – Germany’s finance ministry has lifted a freeze on new spending that was imposed more than three weeks ago, according to a letter seen by Reuters on Thursday.

The move comes a day after Germany’s government clinched a last-minute deal on its 2024 budget following weeks of tense talks.

The letter dated Dec. 14 was from State Secretary of Finance Steffen Saebisch to the other government ministries.

“The budget freeze … ordered on Nov. 21, 2023, is hereby lifted with immediate effect,” it read.

The finance ministry added that it nevertheless recommended the “economical use” of funds “in light of the overall budgetary situation.”—Reuters

General Motors to lay off 1,300 workers at two Michigan plants

REUTERS

General Motors (GM) said on Thursday it is laying off 1,300 workers at two Michigan auto factories in early January.

The largest US automaker said 945 workers will be laid off at its Orion Assembly plant, which is ending production of the Chevrolet Bolt EV and being converted for electric truck production that will start in late 2025. Final production of the Bolt at Orion is set for next week, GM said.

Another 350 out of 1,400 total workers at its Lansing Grand River plant will be laid off due to the end of Chevrolet Camaro production, but the factory will continue producing the Cadillac CT4 and Cadillac CT5. GM said affected hourly employees will be offered positions at other factories.

GM disclosed in October it was delaying production of electric pickup trucks at the Orion plant by a year, so the layoff affects all production workers at that plant. The Detroit automaker had been set to begin production of the electric Chevrolet Silverado and GMC Sierra in late 2024 at the suburban Detroit plant.

GM CEO Mary Barra said the delay would enable the automaker “to make engineering and other changes that will make the trucks more efficient and less expensive to produce, and therefore more profitable.”

GM, which has vowed to stop selling gas-powered vehicles by 2035, in October said it was abandoning a goal of building 400,000 EVs from 2022 through mid-2024.

GM’s rival Ford said in October it was temporarily cutting one shift at its plant that builds the F-150 Lightning EV.

Ford told suppliers this week it planned to produce about 1,600 electric F-150 Lightning EV trucks per week starting in January in 2024, roughly half of the 3,200 it previously had planned.—Reuters

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