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Philippines now ‘moderately free’ in economic aspects — global index

A Philippine flag flutters in the wind at the National Shrine of Mary, Queen of Peace in Quezon City. — PHILIPPINE STAR/MIGUEL DE GUZMAN

By Justine Irish D. Tabile, Reporter

THE Philippines went up six notches to 82nd out of 176 countries and is now considered “moderately free,” according to a global index on economic freedom by The Heritage Foundation.

In the 2025 Index of Economic Freedom, the US-based conservative think tank said the Philippines’ score increased by 1.6 points to 60.6 from 59 in 2024. The Philippines ranked 88th in last year’s index.

The country’s latest ranking is now equivalent to an economic freedom status of “moderately free,” after being “mostly unfree” in 2024.

Philippines climbs in Economic Freedom Index

Singapore (84.1) topped this year’s index as the freest economy, followed by Switzerland (83.7), Ireland (83.1), Taiwan (79.7), and Luxembourg (79.5).

The bottom five countries include North Korea (176th), Cuba (175th), Venezuela (174th), Zimbabwe (173rd), and Sudan (172nd).

Among 39 Asia-Pacific countries, the Philippines ranked 16th, surpassing the 58.3 regional average and some of its Association of Southeast Asian Nations peers — Thailand (84th), Cambodia (98th), and Laos (140th).

However, the country lagged behind Malaysia (44th), Brunei Darussalam (46th), Indonesia (60th), and Vietnam (61st).

The index measures 12 aspects of economic freedom, which are grouped into four broad pillars — rule of law, government size, regulatory efficiency, and market openness.

Under the pillar of rule of law, the country scored 47.4 in property rights, 42.5 in judicial effectiveness, and 35.3 in government integrity.

“The overall rule of law is weak in the Philippines. The country’s property rights score is below the world average; its judicial effectiveness score is below the world average; and its government integrity score is below the world average,” said the Heritage Foundation.

Under the government size pillar, the country scored 79.1 in tax burden, 79.9 in government spending, and 47.7 in fiscal health.

According to the think tank, the country’s regulatory environment is “well institutionalized but lacks efficiency.”

This is reflected in its business freedom score of 69.1, labor freedom score of 57.7, and monetary freedom score of 69.8.

In terms of being an open market, the country scored 79.2 in trade freedom and 60 in investment and financial freedom.

“Foreign investment is generally welcome, and the investment code treats foreign investors the same as it treats domestic investors. The financial sector is dominated by banking and is relatively stable, but capital markets are underdeveloped,” the think tank said.

According to the think tank, the Philippine economy has been on a steady path of expansion despite the challenging global economic environment.

“The government has pursued legislative reforms to enhance the entrepreneurial environment and develop a stronger private sector to generate broader-based job growth,” the think tank said.

“Regulatory efficiency has been notably enhanced. The economy has expanded at an average annual rate of more than 6% over the past three years,” it added.

However, The Heritage Foundation said that institutional challenges continue to persist with corruption continuing to undermine long-term economic development in the Philippines.

Leonardo A. Lanzona, an economics professor at the Ateneo de Manila University, said the Philippines’ score reflects its “import dependent character which resulted in lower tariffs.”

“While this may be good news to consumers, it may not bode well to producers. While lower tariffs are not necessarily bad, it is still crucial to develop our production,” Mr. Lanzona said in a Facebook message.

“Monetary policies are also generally sensitive to market needs, but the country needs to focus on the real sector to enjoy these gains in economic freedom,” he added.

John Paolo R. Rivera, a senior research fellow at the Philippine Institute for Development Studies, said that the report showed the Philippines’ progress in the areas of fiscal health, monetary stability, and trade freedom.

“The government’s efforts to maintain macroeconomic stability despite global headwinds, improve tax collection efficiency, and advance infrastructure and digitalization have likely contributed to better scores,” Mr. Rivera said in a Viber message.

However, he said that the country remains challenged in the areas of regulatory efficiency, judicial effectiveness, and corruption control.

“To further improve, the country can focus on streamlining business regulations to reduce red tape and lower the cost of compliance for micro, small and medium enterprises,” he said.

He added that the country should strengthen the rule of law and contract enforcement which will help boost investor confidence.

Ateneo School of Government Dean and Economics Professor Philip Arnold P. Tuaño said that among the highlights of the report are the significant increases in the country’s scores in fiscal health, monetary freedom, and trade freedom.

“The Philippines stayed the same in terms of its public debt to gross domestic product ratio and was able to service its significant government debt; there is some movement in terms of the implementation of tax reform in the country,” said Mr. Tuaño in an e-mail.

Meanwhile, he attributed the slight increase in the country’s score on “property rights” to the increased digitalization efforts on land registration.

“There is also a slight increase in government integrity as a result of the legislation of the new procurement law, which will allow greater transparency and accountability, even if there is still weak enforcement,” Mr. Tuaño added.

For Filomeno S. Sta. Ana III, coordinator of Action for Economic Reforms, some indicators in the index do not necessarily lead to good outcomes.

“The proper use of tools is very contextual. It doesn’t mean, for example, that an open or liberal capital account is always good. It can likewise be problematic. A very open capital account can hurt the real economy,” said Mr. Sta. Ana in a Viber message.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the country’s better ranking can be attributed to the passage of measures that eased foreign ownership restrictions, as well as economic reforms.

“All of these helped in the country’s economic freedom, especially from the point of view of international investors,” he added.

“Higher governance standards are also required to further improve economic freedom rankings… as corruption impedes further economic growth and development of the country.”

BoC says tariff cuts result in P35-B foregone revenues

Bureau of Customs (BoC) Commissioner Bienvenido Y. Rubio shows off a vape product from a seized shipment of unregistered vape products worth P53 million at Warehouse 3, BoC Compound in South Harbor, Port of Manila, March 18, 2025. — PHILIPPINE STAR/BALDEMOR

By Aubrey Rose A. Inosante, Reporter

THE BUREAU of Customs (BoC) on Tuesday said Executive Order (EO) No. 62, which lowered tariffs on rice, electric vehicles and other commodities, resulted in around P35 billion in foregone revenues.

“If you add up the impact on rice, cars — electric vehicles, and Jet A-1 fuel, the impact was more or less around P35 billion,” Customs Commissioner Bienvenido Y. Rubio told BusinessWorld at the Port of Manila on Tuesday.

The tariff cuts impacted the agency’s ability to meet its revenue target of P939.6 billion last year, falling short by 0.92%.

EO 62, which took effect in July 2024, lowered import tariffs on rice to 15% until 2028 to tame inflation. It also extended the effectivity of lower rates on pork, corn, and mechanically deboned poultry meat.

The same order also extended the zero-tariff policy on electric vehicles (e-vehicles) and parts through 2028, as well as expanded the coverage to other types of e-vehicles.

“But for now, we just hope [to hit the target]. We can’t do anything. There are no tax measures increasing the rate of duties. We are always dependent on the arrival of goods,” he said.

This year, the BoC is targeting to collect P1.06 trillion, 14.28% higher than the actual collection of P931.05 billion in 2024.

Earlier, BoC Assistant Commissioner Vincent Philip C. Maronilla said the agency will focus on other nontraditional revenues to offset the tariff cuts.

“What we’re doing, we have an effective selectivity system. We will make sure that all high-value goods that come out will be taxed with that declaration,” Mr. Rubio said.

Meanwhile, the BoC said it has seized two containers with more than 46,000 vape units from China that were misdeclared as plastic wares.

“Based on information given by our foreign counterpart, two containers were examined by the Port of Manila, and it turned out that the two containers contain vape units. The declaration is plastic wares but when we opened the two containers, 46,600 units of vape were found,” Customs Deputy Commissioner for Enforcement Group Teddy Sandy S. Raval said.

The BoC said the containers had 233 boxes of assorted flavored vape products with a combined value of P53 million, including the unpaid tax and street value.

The Customs bureau will conduct an investigation, and file criminal and administrative cases related to the shipment of the misdeclared vape products.

Metropolitan Bank & Trust Co. to hold virtual Annual Stockholders’ Meeting on April 23

 


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Topline lowers final IPO price, eyes up to P732.62-M proceeds

PHILIPPINE STAR/EHDA M. DAGOOC

CEBU-BASED fuel retailer Top Line Business Development Corp. (Topline) has set its initial public offering (IPO) price at 31 centavos per share, targeting proceeds of up to P732.62 million.

The IPO comprises 2.36 billion shares, including a base offer of 2.15 billion primary common shares and an overallotment option of up to 214.84 million secondary common shares, the company said in a regulatory filing on Tuesday.

The final price is lower than the initial maximum offer price of 38 centavos per share.

Topline initially planned to raise P3.16 billion but reduced the offering to P900 million before adjusting it to P732.62 million based on the final price.

“The final offer price considers current market conditions while ensuring Topline can pursue its strategic initiatives, including expanding fuel stations and logistics capabilities with additional fuel trucks and tankers,” Topline said in a statement.

“We are pleased with the strong demand at this price and believe it offers significant upside potential for investors,” it added.

Based on Topline’s prospectus dated Feb. 25, the offer period will run from March 24 to 31, with a target listing date of April 8.

Topline Chairman, President, and Chief Executive Officer Eugene Erik C. Laparasan Lim said the company adjusted its IPO proceeds allocation to align with near-term expansion plans.

Proceeds will be used to build new Light Fuels service stations and acquire a fuel tanker to increase storage capacity. A portion will also be set aside for working capital and general corporate purposes.

“Through vertical integration, we are strengthening control over supply chain risks, leading to healthier profit margins, improved supply stability, and consistent product quality. Enhanced operational efficiency will sustain our expansion and growth momentum,” Mr. Lim said.

“In response to feedback from potential institutional investors, we have refined our expansion plans and IPO proceeds allocation to prioritize depot expansion, importation process improvements, and operational growth. This strategy will reinforce our market position in the high-growth Central Visayas region and create long-term value for shareholders,” he added. — Revin Mikhael D. Ochave

PetroGreen unit’s solar project targets 33,000 homes in Isabela

PETROENERGY.COM.PH

YUCHENGCO-LED BKS Green Energy Corp. has started constructing the 40-megawatt direct current (MWdc) Limbauan Solar Power Project in San Pablo, Isabela, expected to supply clean energy to approximately 33,000 households.

The P1.9-billion project will utilize 52,640 solar panels supplied by Chinese company Trina Solar Co., Ltd., the company said in a media release on Tuesday.

The solar farm will be developed in two phases: a 6-MWdc Phase 1, which will connect to the Isabela Electric Cooperative II system, and a 34-MWdc Phase 2, which will link to the National Grid Corp. of the Philippines’ (NGCP) 69-kilovolt Tuguegarao-Cabagan line through a dedicated transmission facility.

Once completed by the end of this year, the facility is expected to generate up to 59 gigawatt-hours of clean energy annually, avoiding 31,700 metric tons of carbon dioxide emissions.

BKS Green Energy is a subsidiary of Rizal Green Energy Corp., a joint venture between PetroGreen Energy Corp. (PGEC) and Japan’s Taisei Corp. PGEC is the renewable energy arm of publicly listed PetroEnergy Resources Corp.

“In addition to increasing energy supply, we anticipate employing around 500 to 600 workers at the peak of construction, partnering with our host LGUs (local government units) for our corporate social responsibility and environmental protection programs, and contributing to the overall economic and social progress of the Cagayan Valley region,” said Maria Victoria M. Oliver, PGEC vice-president for business development and commercial operations.

In November last year, the Department of Energy (DoE) certified the solar power project as an energy project of national significance due to its contribution to economic growth.

“The government needs more private investors, like PGEC and BKS, to invest in and develop renewable energy facilities because of our ever-growing demand for power,” said Marissa P. Cerezo, director of the DoE Renewable Energy Management Bureau. — Sheldeen Joy Talavera

Sotheby’s International Realty enters PHL market

PHILSTAR FILE PHOTO

NEW YORK-BASED real estate brokerage Sotheby’s International Realty has entered the Philippines, citing rising demand for luxury properties and the country’s potential as a prime destination for high-end real estate investments.

Its official local affiliate Philippines Sotheby’s International Realty (PSIR) plans to open at least three major offices across Luzon, Visayas, and Mindanao within the next five years.

“I think we’ve had our eye on the Philippines for some time. We’ve been very responsive to the demands for Philippine property,” Chris Palumbo, head of region, Asia-Pacific at Sotheby’s International Realty Affiliates LLC, said during a briefing on Tuesday.

Since its founding in 1976, Sotheby’s International Realty has expanded into 84 countries and territories, with over 26,100 sales associates and 1,100 offices worldwide.

“By leveraging Sotheby’s prestigious international reputation, complemented by the local expertise of PSIR, this alliance endeavors to establish an unparalleled platform that presents the stunning properties of the Philippines to the global marketplace,” PSIR Managing Director Catherine Dianne L. Ocariz-Florencio said in a statement.

Ms. Ocariz-Florencio said the firm aims to shift attention beyond Metro Manila’s central business districts and showcase the country’s diverse luxury real estate offerings.

Luxury and upscale developments, priced at P12 million and above, accounted for 41% of new residential launches in 2024, nearly double the 20% share recorded a year earlier, according to Colliers Philippines’ fourth-quarter property market report.

“There’s a lot that I feel is attractive about the Philippines — you’ve got a great urban environment here; someone from New York will love that. On the other hand, if you want to be chilled out, relaxed, you’ve got Cebu or Boracay,” Mr. Palumbo told BusinessWorld on the sidelines of the briefing.

PSIR also aims to promote overseas luxury properties to Filipino investors.

“With this platform, I think there are plenty of opportunities for Filipinos to start investing abroad, especially now that we are becoming more educated about international opportunities,” Ms. Ocariz-Florencio said. 

As Sotheby’s International Realty’s official Philippine affiliate, PSIR is committed to raising the standards for marketing luxury properties in the country.

“One thing we need to improve on locally is how we showcase properties. With this partnership, I’m excited to implement global best practices and standards in luxury real estate marketing,” Ms. Ocariz-Florencio said. — Beatriz Marie D. Cruz

Primex signs management deal with Dusit for San Juan hotel

EXTERIOR RENDERING of Primex Tower, Manila — PRESS.ACCOR.COM

LISTED developer Primex Corp. said its subsidiary Primex Realty Corp. has signed a hotel management agreement with Thai hospitality group Dusit International for a planned hotel in San Juan City. 

Under the agreement, Primex Realty will collaborate with Dusit to manage and operate the 200-room Dusit Greenhills Manila hotel, Primex said in a regulatory filing on Tuesday. 

Set to open in 2026, Dusit Greenhills Manila will occupy the top ten floors of the 50-storey Primex Tower, a mixed-use development with office and retail spaces.

“This agreement aligns with our strategic goals for growth, and we believe that together we will create memorable experiences for our guests while elevating the local community,” Primex Executive Vice-President Karlvin Ernest L. Ang said. 

The hotel will feature the all-day dining venue Benjarong, a Thai restaurant, along with a rooftop bar, swimming pool, gym, and ballroom.

It will also have fully equipped meeting rooms with seamless connectivity for business and lifestyle events, catering to both leisure and corporate travelers.

Primex said Dusit International’s hotel arm, Dusit Hotels and Resorts, will bring its signature Thai-inspired gracious hospitality and attentive service to the property.

Dusit Hotels and Resorts operates nearly 300 properties worldwide.

“We are delighted to partner with Primex Realty to introduce Dusit’s unique brand of Thai-inspired gracious hospitality to San Juan. Together, we aim to create a sophisticated urban retreat that will set a new benchmark for hospitality in the city. We look forward to a successful and mutually rewarding partnership,” Dusit International Chief Operating Officer Gilles Cretallaz said. 

Dusit International has investments in real estate development, hospitality-related services, and the food sector.

Primex is engaged in real estate development and maintains land banks across various locations for residential subdivisions, high-rise condominiums, office spaces, and master-planned housing projects.

On Tuesday, Primex shares rose by 4.69% or six centavos to P1.34 apiece. — Revin Mikhael D. Ochave

A majority of businesses intrigued by the potential of AI in achieving sustainability goals whilst energy consumption concerns persist

More than one in two organizations acknowledge gap in understanding how digital technology can facilitate achieving sustainability goals

Over three quarters of businesses (76%) across Asia, Europe and the Middle East are intrigued by the potential of digital technologies, including AI and cloud computing in driving sustainable development, according to the latest survey report titled “Tech-Driven Sustainability Trends and Index 2024,” commissioned by Alibaba Cloud, the digital technology and intelligence backbone of Alibaba Group. However, the substantial energy consumption associated with these technologies is still reflecting a key barrier to broader adoption, as 61% of respondents still express concerns over the matter.

This interest in the potential of AI, cloud computing and other advanced digital technologies to support sustainable development varies across regions, with emerging Asian markets leading the way (83%), followed closely by the Middle East (78%), Europe (74%), and developed Asian markets (72%). Notably, the Philippines (91%), Singapore (84%), Indonesia (81%), and Thailand (81%), demonstrate particularly high interest.

Regional Variations in AI Adoption and Sustainability Efforts

Despite this optimism, 59% of businesses acknowledge gap in understanding how digital technology can assist in achieving sustainability goals with Asia leading at 63%, followed by Europe at 61% and the Middle East at 45%. Around two-thirds (62%) of executives believe their organizations are lagging in adopting cloud computing and AI to accelerate progress towards sustainability goals. This concern is particularly noted in Singapore (80%), the Philippines (77%), and Japan (75%) and Hong Kong SAR (75%), indicating a pressing need for organizations to accelerate their technological adoption to advance sustainability.

Overall, 82% of businesses agree that sustainable development in technology is paramount for their companies, with markets like Singapore (93%), the Philippines (91%), and Indonesia (89%) leading the charge. Companies increasingly recognize the multifaceted benefits of adopting digital technologies for sustainability including cost savings, improved operational efficiencies, and enhanced compliance with Environmental, Social, and Governance (ESG) regulations.

AI and machine learning are viewed as the most crucial digital technologies for advancing corporate sustainability, with businesses in the Middle East (52%) placing greater emphasis on their importance compared to Europe (41%), emerging Asian markets (40%) and developed Asian markets (36%). Meanwhile, 81% of businesses feel human oversight is needed in guiding the development of digital technologies, including AI tools with the Middle East feel the strongest at 91%, followed by emerging Asian markets at 83%, Europe at 82% and developed Asian markets at 74%.

However, the survey reveals a notable concern: 61% of respondents fear that the high energy consumption associated with digital technologies may hinder widespread AI adoption. This concern is even higher in Singapore (85%), the Philippines (77%) and Hong Kong SAR (75%). Furthermore, 71% of businesses believe that the substantial energy consumption of digital technologies such as powering AI may outweigh its benefits with the highest concerns from Singapore (86%), the Philippines (84%) and Malaysia (81%).

The report also highlights the importance of selecting technology providers that prioritize sustainability. When selecting a “green” cloud provider, approximately half of businesses prioritize those that use renewable energy (51%), maintain energy-efficient data centers (46%), and implement carbon footprint reduction initiatives (42%).

Commitment to Green AI and Open-source Innovation

“With feedback from decision-makers across 13 markets, the survey report sheds light on the current attitudes and challenges businesses face in adopting AI and cloud computing for sustainability,” said Selina Yuan, President of International Business, Alibaba Cloud Intelligence. “At Alibaba Cloud, we are committed to supporting businesses on their sustainability journeys with scalable and sustainable solutions. By pledging to use 100% clean energy by 2030 and improving the energy efficiency at our global data centers, as well as optimizing Generative AI capabilities such as large language models (LLMs) performance, AI can be a powerful tool to improve efficiency and optimize energy consumption.”

Alibaba Cloud has made notable progress in its green cloud initiatives. In the fiscal year ending March 31, 2024, the average power usage effectiveness (PUE) of the company’s self-built data centers improved to 1.200 from 1.215 the year before, with 56% of the electricity consumed coming from clean sources. Additionally, Alibaba’s green computing infrastructure has enabled clients to reduce their emissions by 9.884 million tons, a remarkable increase of 44% year on year.

In addition, Alibaba Cloud is at the forefront of democratizing AI through its open-source initiatives, making advanced AI technologies accessible and affordable for businesses of all sizes. By releasing cutting-edge open-source models from its proprietary large language model Qwen family, including Qwen2.5-VL and Qwen2.5-1M and its video foundation model Tongyi Wanxiang (Wan), Alibaba Cloud empowers developers to create task-specific AI applications that are both efficient and cost-effective. These open-source models have already inspired over 100,000 derivative models on Hugging Face, showcasing their global adoption and versatility. By promoting smaller parameter models, Alibaba Cloud reduces the cost and energy consumption of AI training and deployment, fostering a collaborative ecosystem that drives energy-efficient innovation.

Surveying 1,300 decision-makers across 13 markets, “Tech-Driven Sustainability Trends and Index 2024” aims to provide valuable insights into the evolving landscape of corporate sustainability. The survey report underscores the essential role of technology in driving impactful change, while highlighting the need for businesses to adopt AI and cloud computing responsibly to address energy consumption concerns and bridge the gap in sustainability efforts.

About the Survey

Alibaba Cloud’s “Tech-Driven Sustainability Trends and Index 2024” was independently conducted by Yonder Consulting, a business consulting firm, with advisory, design and analytical support from The Purpose Business, a sustainability consultancy. The survey collected feedback from May 10 to June 19, 2024, involving 1,300 business leaders and senior management from various industries, including technology and communications, finance, infrastructure, renewable resources, healthcare, transportation, retail, and manufacturing.

Respondents were located across 13 markets in Asia (Indonesia, Malaysia, the Philippines, Thailand, Hong Kong SAR, Japan, Singapore and South Korea), Europe (France, Germany, and United Kingdom), and the Middle East (Saudi Arabia and the UAE). In this survey, developed Asian markets refer to Hong Kong SAR, Japan, Singapore, and South Korea, while emerging Asian markets include Indonesia, Malaysia, the Philippines, and Thailand.

 


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A Brown expanding power portfolio with new subsidiary

FREEPIK

LISTED holding company A Brown Co., Inc. (ABCI) has obtained regulatory approval to establish a new subsidiary under its energy investment arm ABC Energy, Inc. (ABCEI) to expand its power generation business.

The Securities and Exchange Commission (SEC) approved the incorporation of Manolo Fortich Power Corp. (MFPC), which will operate under ABCEI, ABCI said in a regulatory filing on Tuesday.

ABCEI, a wholly owned subsidiary of ABCI, serves as a holding company for the group’s energy-related investments.

According to ABCI, MFPC’s primary purpose is to acquire, develop, construct, invest in, and operate power-generating plants, including solar power facilities, and engage in power generation.

MFPC will also develop, assemble, and operate other power-related facilities, equipment, and systems, as well as conventional and renewable energy resources.

The company will be involved in electricity and carbon credit sales, wholesale and retail electricity supply, aggregation, and the operation and maintenance of power plants.

ABCI, a Mindanao-based company, has interests in property development, power generation, public utilities, and agribusiness.

In January, ABCI said it invested P2.5 billion to develop a mixed-use complex under a joint venture with the Misamis Oriental provincial government.

For the first nine months of 2024, ABCI’s net income fell by 40% to P290.82 million from P484.50 million a year earlier.

Revenue rose by 31% to P1.45 billion from P1.10 billion, driven by higher sales of real estate units and agricultural products, including crude palm oil.

On Tuesday, ABCI shares declined by 1.82% or one centavo to 54 centavos per share. — Revin Mikhael D. Ochave

Treasury fully awards reissued bonds at higher average rate

BW FILE PHOTO

THE GOVERNMENT made a full award of the Treasury bonds (T-bonds) it offered on Tuesday at a higher average rate amid increasing global yields due to uncertainties in developed markets.

The Bureau of the Treasury (BTr) raised P30 billion as planned via the reissued 10-year bonds it auctioned off on Tuesday as total bids reached P58.947 billion or almost twice as much as the amount on offer.

This brought the total outstanding volume for the bond series to P366.9 billion, the Treasury said in a statement.

The bonds, which have a remaining life of eight years and 10 months, were awarded at an average rate of 6.207%. Accepted bid yields ranged from 6.195% to 6.222%.

The average rate of the reissued papers was 8.9 basis points (bps) higher than the 6.118% fetched for the series’ last award on Feb. 18, but 4.3 bps lower than the 6.25% coupon for the issue.

This was also 3.78 bps below the 6.096% quoted for the 10-year bond but 1.45 bps above the 6.1925% seen for the same bond series at the secondary market before Tuesday’s auction, based on PHP Bloomberg Valuation Service Reference Rates data provided by the BTr.

The government made a full award of its offer as it saw “fairly decent” demand, a trader said in a text message.

“This was partly because of duration and anticipation of more debt supply at the belly to the long end of the curve moving forward as the BTr is expected to prefer to lengthen its maturity profile,” the trader said.

The BTr fully awarded the T-bonds it auctioned off as rates remained close to comparable secondary market levels, even as the average yield rose from the prior issuance amid the recent increase in global yields, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Euro zone bond yields rose sharply on Friday after Germany’s chancellor-in-waiting Friedrich Merz thrashed out a deal with the Green and Social Democrat parties to overhaul the country’s debt rules and massively boost state spending, Reuters reported.

Germany’s 10-year bond yield, the benchmark for the euro zone bloc, rose to 2.936%.

Mr. Merz reached an agreement with the Greens just days before a parliamentary vote on reforming the borrowing rules, a source close to the negotiations told Reuters. A debt deal compromise is now being examined by finance ministry officials, parliamentary sources said.

Yields soared earlier this month as investors learnt of the plans, which would mean much more borrowing via bond markets.

Germany’s 30-year bond yield on Friday surged to its highest since October 2023 at 3.253% and was within touching distance of its highest since 2011.

The spread between US 10-year Treasuries and German Bund yields ended at 142 bps.

US bond yields rose on Friday on concerns over the potentially inflationary impact of tariffs as trade wars between the US and its trading partners escalate.

Meanwhile, dovish signals from Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona, Jr. helped cap the increase in T-bond yields, Mr. Ricafort added.

Mr. Remolona last week said the BSP remains on easing mode despite its unexpected decision to keep rates steady last month amid global uncertainties.

He added that a rate cut is “on the table” at the Monetary Board’s next rate-setting meeting on April 10.

The BTr is looking to raise P147 billion from the domestic market this month, or P22 billion from Treasury bills and P125 billion from T-bonds.

The government borrows from local and foreign sources to help fund its budget deficit, which is capped at P1.54 trillion or 5.3% of gross domestic product this year. — A.M.C. Sy with Reuters

Art in the Park celebrates its community

SCENE from a previous edition of Art in the Park.

THOSE active in the Salcedo Park community and the artists that have been part of Art in the Park over the years are again coming together at the Jaime Velasquez Park in Makati City this month.

The art festival will see 61 exhibitors representing Filipino galleries, art collectives, independent art spaces, and student groups at its 19th edition on March 23, from 10 a.m. to 10 p.m.

Entrance to Art in the Park is free, and the price the works can sell for is capped at P70,000. Many fairgoers can score coveted artworks for much less, thanks to “a vibrant sense of art appreciation and belonging in the community,” said Art in the Park co-founder Lisa Periquet, at a March 11 media roundtable in Pablo Bistro, Makati City.

While it may sit comfortably in the shadow of its recently concluded, grander counterpart, Art Fair Philippines (which was held largely in a park this year as well), the thrust of Art in the Park has always been different.

“This started as a first anniversary event for the Salcedo Market, in 2006. It was linked to the market for a long time, so we used to do it on the same day. That went on for several years and eventually, because we got our own crowd, our own audience, we separated it,” Ms. Periquet said.

She recalled how Salcedo Village used to be a quiet, extremely zoned neighborhood before the market began, with commercial establishments not allowed on street level.

“Once Salcedo Market opened, there was an opportunity for people to have a place to buy food and hang out within the neighborhood. It made it more livable. Now, this is the home of so many restaurants and businesses. This vibrant sense of community gives life to the place, and Art in the Park is one of those events,” she explained.

Ms. Periquet said people were drawn to Art in the Park for being “an interesting incubator or breeding ground for younger artists and collectors who have just started or haven’t broken into the market.”

FEATURED ARTISTS
Each year, the fair highlights a number of artists whose works are shown in special exhibits around the park. This year’s featured artists are multimedia visual artist TRNZ, contemporary mixed-media artist AR Manalo, and designer and artist Carlo Tanseco.

TRNZ (real name: Terence Eduarte), who first exhibited at Art in the Park in 2018, will be showcasing his acrylic paintings depicting the beauty in ordinary scenes. His special exhibit is titled A Study of Quiet Disguises, inspired by his day-to-day encounters with random objects, like clothes at the ukay-ukay (used clothing markets) or piles of shuttlecocks at the corner of a badminton court.

“Those who follow my work will see that I’ve been exploring. I usually do portraits focused on the people in my paintings, like what they’re wearing and what they’re holding. This time around, I’ve been focusing on the surroundings, to give kind of an emphasis on the place and ambiance,” Mr. Eduarte said.

“There’s a narrative I want the audience to see, that I convey through cues and vague use of elements, but I never give the whole picture. I always want it to be open-ended,” he added.

Meanwhile, Mr. Manalo’s works seem like standard paintings on canvas at first glance, but turn out to contain mixed-media cut-outs akin to elaborate pop-up books. He told BusinessWorld that this special exhibit is once again dedicated to his child.

“It’s called Princess in the Park because it’s made for my three-year-old daughter who loves going to the park. When she grows up, I’ll have something to show her when she sees nothing of herself,” he explained. The images on the various vintage prints, emboldened with ink, depict a young girl in different scenarios.

“Yes, I’m a certified girl dad,” added Mr. Manalo, proud that his full-circle moment at Art in the Park, where he started submitting works many years ago, is now a platform to show his fatherly love.

Finally, Mr. Tanseco will be using his space at the fair to reintroduce a pivotal work from his critically acclaimed Rizal Matchbox series. Titled Liyaban ang Apoy ng Kagitingan (Mid-Open – Red), the piece is inspired by the safety matches with Jose Rizal’s image on them.

Coming from his well-received sari-sari store-inspired exhibit at Art Fair Philippines, he hopes the matchbox piece evokes “some patriotism.” The works are in acrylic on box canvas.

This year’s special exhibit is also a full-circle moment for Mr. Tanseco, who started out attending Art in the Park as a collector, until eventually he started exhibiting with various galleries. As a featured artist, he will not only show the matchbox works, but also offer 20 limited edition giclée prints based on it.

MUSEUM FOUNDATION
Proceeds from Art in the Park will go to the Museum Foundation of the Philippines, in support of its projects and programs for the National Museum of the Philippines and its network.

This year’s exhibitors are Ang INK, Archivo 1984, Art for Space, ART LAB: Atelier Cesare & Jean Marie Syjuco, Art Toys PH, Art Underground, Art Verité Gallery, Artbeat Collective, Artery Art Space, Avellana Art Gallery, Boston Art Gallery, Cartellino Art, Cornerstone Pottery (EJ Espiritu), the Cultural Center of the Philippines, De La Salle – College of Saint Benilde, FA Gallery, Fuse Projects;

Galeria de las Islas, Galerie Anna, Galerie Artes, Galerie Stephanie, Gallery Genesis, ILCP Art Space, J Studio, Jon and Tessy Pettyjohn, KASIBULAN, Komiket, Kulay Art Group, Looking for Juan;

MAG, METRO Gallery, MONO8, Nest, Nineveh Artspace, Orange Project, Pintô Art Museum and Arboretum, Qube Gallery, Resurrection Furniture, Savage Mind / Kamarin Art Space, Sheerjoy Collective, Sierra Madre Gallery, Space Encounters Gallery, Superduper Art Gallery, Talyer 15 Manila, The Authenticity Zero Collective;

The Mighty Bhutens, The Photography Collective, The Print Outpost, The Thursday Group, Tin-Aw Art Projects, UP Artists’ Circle, UP College of Fine Arts, Urban Sketchers Manila, VeryGood Gallery, Village Art Gallery, Vinyl on Vinyl, White Walls Gallery, and Ysobel Art Gallery.

Visitors seeking refreshments or a dining experience will have a variety of food and beverage concessionaires to choose from at the fair. Singer-songwriter duo Leanne and Naara, jazz musician Soulful Mood, and all-vinyl DJ Mario Serrano of EST City will be playing music throughout the day.

BPI credit cardholders can enjoy special perks and privileges. For a minimum purchase of P3,000, they can convert purchases into monthly installments at 0% interest for up to six months. There is also a “Buy Now; Pay 3 Months Later” option.

For more information, visit www.artinthepark.ph or @artintheparkph on Facebook and Instagram. — Brontë H. Lacsamana

The Philippine Housing Roadmap, 2025 to 2040

PHILSTAR FILE PHOTO

(Part 1)

Next to food security, the most serious challenge to the present Administration in the economic realm is to provide decent housing to the lowest income groups among our more than 22 million households.

I am proud of the fact that the private research group, the Center for Research and Communication (CRC), to which I have belonged since 1967, has been one of the most active in helping the Philippine government and the private business sector to formulate housing roadmaps. Led by one of the leading experts on the economics of housing in the Philippines, Dr. Winston Padojinog, the Philippine Housing Roadmap for 2025 to 2040 was recently completed, in partnership with the four housing and real estate associations, i.e., the Subdivision and Housing Developers Association (SHDA), the Organization of Socialized and Economic Housing Developers of the Philippines (OSHDP), the National Real Estate Association (NREA), and the Chamber of Real Estate and Builders’ Association (CREBA).

I am presenting in this series of articles a summary of the results of the study for the guidance of all sectors of Philippine society committed to providing decent housing, especially to the low-income households which can constitute as much as 60% of the entire population of some 120 million Filipinos.

Since the last housing roadmaps formulated in 2012 and 2016, the housing sector has achieved significant milestones, including the establishment of the Department of Human Settlements and Urban Development (DHSUD) and the provision of incentives for socialized housing. Despites these achievements, however, the Philippines still suffers from serious shortages in housing for low-income households as housing production continues to fall short of the goals. Of the one million units targeted by DHSUD to produce annually over the six-year period under the present Administration of Ferdinand Marcos, Jr., less than 100,000 units have been constructed annually. The increasing gap between housing demand and supply, compounded by increasing construction costs and the growing number of marginalized households, underscores the urgent need to adopt a more coordinated approach between the public and private sectors. The availability of housing, whether owned or rented, for the masses is one of the most stabilizing factors any society.

While recent adjustments to socialized housing price ceilings, VAT exemptions, and housing subsidies and incentives offer some relief, fiscal support, and collaboration among the key stakeholders, such as government agencies, developers, housing associations and financing associations continue to be grossly insufficient. The Roadmap prepared by the team of Dr. Padojinog for the period 2025 to 2040 aims to coordinate the efforts of all housing sector stakeholders to address the serious backlogs effectively, which by 2023 was already estimated at 12.4 million and projected to balloon to 16.6 million by 2040 if present trends are not reversed.

The vision that guided the four participating real estate and housing associations is as follows:

“Every family has the right to equal access to a decent, affordable, safe, resilient and sustainable home and community regardless of economic status. The housing industry stakeholders, both public and private sectors, envision to collaborate in providing housing solutions to eliminate the backlog by the year 2040.”

To realize this vision, the four associations — in close cooperation with the Government — aim to achieve the following goals: 1.) Increase the production of decent, safe, affordable and sustainable housing according to targeted needs and market segment beneficiaries in each region; 2.) Mobilize funding for public and socialized housing and encourage investments in affordable housing; 3.) Bridge end-user financing and affordability gaps; 4.) Improve housing’s regulatory environment; 5.) Encourage the establishment of decent, safe, resilient, sustainable, and affordable housing units and housing communities.

Given these mission and vision statements for the entire Philippine housing industry, the Roadmap focused on addressing the current weaknesses of and threats to the industry. These include: 1.) Unclear respective roles of the government and private sector in the provision of public and socialized housing that often result in overlaps and confusion; 2.) Price ceiling adjustments that often are not responsive to the ever-changing conditions of the housing sector; 3.) Lack of diversity and flexibility in the development approach to socialized housing; 4.) Lack of assurance on the provision of income tax holidays to providers of economic and low-cost housing units, which lack often inhibits long-term investment decisions related to housing; 5.) Absence of a regulatory framework and standards to promote “green” or sustainable housing, including the provision of tax breaks and incentives to developers that adopt them; 6.) Affordability gaps that limit the capacity of the marginalized and socialized housing segments to afford renting or owning a housing unit; 7.) Overdependence on domestic capital and traditional bank financing, exacerbated by the limited amount of available guaranty funds for housing development and the absence of asset securitization for affordable housing segments; 8.) Limited government budgetary allocations to the housing agency and to key shelter agencies targeting marginalized and low-wage earners; and, 9.) Bureaucratic delays in the approval process that increase costs and discourage the production of housing units.

In response to these industry gaps and limitations, certain strategic initiatives were recommended to reduce the backlog and to improve affordability. First on the list is to have a clear delineation of roles between the government and private developers. It is recommended that the government prioritize public and socialized housing for lower-income households and informal settlers, while private developers focus on mid- to upper-income market segments and explore alternative development approaches such as horizontal housing. It is crucial to emphasize the need to allocate funds for socialized housing and to address affordability gaps. Additionally, expanding incentives for economic and low-cost housing developers, including tax holidays and aligning thresholds with updated regulations, can stimulate production.

To bridge affordability and access gaps, the government should enhance public housing options through long-term leases and interest expense subsidies. There is need to improve access to developmental funding for both socialized and economic housing by liberalizing interest rates, attracting foreign direct investments, and exploring housing and real estate investment trusts (REITS). Affordable end-user financing should likewise be supported through subsidized rates and extended payment terms. On the other hand, regular and increased budget allocations for public and socialized housing, including real estate management, alongside regulatory improvements and sustainability measures, will be critical. Lastly, establishing a supportive regulatory environment and encouraging green building practices will further enhance housing development efforts.

Some more specific programs which can achieve the goals and implement the strategies were also recommended. For example, to increase housing production, a co-production model is being suggested in which the government focuses on public housing for informal settlers and the lower 30% of the socialized housing market, while the private sector focuses on the upper income socialized housing, economic housing, and low-cost housing segments. Like in the 4PH model, the government can provide the land while the private sector constructs the housing units. Other housing development approaches besides vertical structures could also be adopted while focusing on areas with the largest housing needs and backlogs. Lastly, other modes of balanced housing compliances could be considered, and the housing escrow fund should be tapped for socialized housing production.

Finally, there is need to improve the regulatory environment, making it as investment friendly as possible for the private sector. Efforts to streamline the permitting and licensing process including the improvement of the housing one-stop processing centers; rationalizing professional accreditation of real estate practitioners; and reviewing land conversion processing initiatives will go a long way in lowering costs and accelerating housing production.

Lastly, to encourage sustainable housing, there should be an emphasis on developing a regulatory framework for green, resilient, and affordable housing, supported by incentives and partnerships for skill training and domestic industry growth. The roadmap to achieve the strategic vision by 2040, the year when the Philippine economy can reasonably aspire to be a First World Economy, concludes with a reinforcement of production targets, an estimate of public funding as well as private capital requirements, and the project economic impact of the housing sector on the national economy.

(To be continued.)

 

Bernardo M. Villegas has a Ph.D. in Economics from Harvard, is professor emeritus at the University of Asia and the Pacific, and a visiting professor at the IESE Business School in Barcelona, Spain. He was a member of the 1986 Constitutional Commission.

bernardo.villegas@uap.asia