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Macau mass tests its population after COVID-19 infections

HONG KONG – Macau carried out mass testing of its 700,000 residents on Tuesday after the emergence of COVID–19 cases in the past week, including at a major casino that prompted authorities to seal 1,500 people inside.

All residents in the world’s biggest gambling hub have been told to take a PCR test on Tuesday and then test themselves daily with rapid antigen tests. The order comes as Typhoon Nalgae approaches southern China with authorities hoping the PCR tests can be completed in one day.

Authorities locked down MGM China’s Cotai casino resort on Sunday, with staff and guests ordered to stay inside for three days. It was not clear whether they would be released on Tuesday.

After of a three-month spell of virtually no COVID cases, 11 infections have been found in the past few days and the return of curbs marks a setback for casino executives and investors keen for a recovery in gambling revenues.

In one bright note for the industry, travelling to Macau became easier for mainland residents from Tuesday with the advent of an online visa system which replaces the need to file applications in person.

Macau, a Chinese special administrative region, has adopted China’s zero-COVID policy that seeks to stamp out every outbreak and implements frequent lockdowns. On the mainland this week, authorities forced the closure of Disney’s Shanghai resort while a Foxconn plant in Zhengzhou continues to be rocked by workers fleeing the compound over strict COVID restrictions. – Reuters

Indonesia revokes firms’ fever syrup licences amid inquiry into 150 deaths

JAKARTA – Indonesia‘s food and drug agency said on Monday it had revoked licenses for syrup-type drug production by two local firms for violating manufacturing rules, as it investigates the deaths of more than 150 children due to acute kidney injury (AKI).

The decision by the BPOM agency came after Indonesia temporarily banned sales of some syrup-based medications and identified the presence in some products of ethylene glycol and diethylene glycol as possible factors in the AKI deaths, most of which were of children under five.

The two ingredients are used in antifreeze and brake fluids and other industrial applications but also as a cheaper alternative in some pharmaceutical products to glycerine, a solvent or thickening agent in many cough syrups. Ethylene glycol and diethylene glycol can be toxic and lead to AKI.

BPOM chief Penny K. Lukito told reporters the “oral liquid” manufacturing licenses of the two companies, PT Yarindo Farmatama and PT Universal Pharmaceutical Industries, had been revoked, adding BPOM was pursuing criminal action against them.

Penny said the two firms produced drugs with substandard raw materials, failed to report a change in ingredients and used some materials in excess of guidelines.

PT Yarindo Farmatama in a statement denied using substandard raw materials in their products and said BPOM approved changes in their ingredients in 2020 and that there were no problems with its distributor.

A lawyer with PT Universal Pharmaceutical Industries declined to comment, citing the ongoing investigation.

Indonesia has seen a surge in AKI cases among children since August, which its health minister said was most likely due to changes in the raw ingredients used in cough and fever syrups.

Indonesia imports its raw ingredients for medicine mostly from China and India, according to the health ministry.

Indonesian health authorities said solvents used in the syrups from the two companies contained impurities.

BPOM said on Monday one of these solvents, propylene glycol, was made by Dow Chemical Thailand.

Dow Chemical Thailand said in a statement that “none of the suppliers mentioned by BPOM are our customers”, and that its product does not contain ethylene glycol or diethylene glycol. It said it had submitted analytical data to the BPOM.

BPOM said it would look into distributors of the two drug makers to see if they supplied materials to other pharmaceutical firms.

Indonesia has been investigating AKI cases in consultation with the World Health Organization (WHO) after a similar incident in Gambia earlier this year, which has seen at least 70 deaths related to syrup medications made by India’s Maiden Pharmaceuticals. – Reuters

India’s first fully solar village lights up the lives of poor residents

PIXABAY

MODHERA, India – Kesa Bhai Prajapati beams with a smile as he molds blocks of clay into jugs and vases on a potter’s wheel.

These days, Prajapati, 68, from the village of Modhera in western India’s Gujarat state, has doubled the amount of earthenware he makes compared to a few months ago since he no longer has to turn the wheel manually as he could not then afford high electricity bill that were up to 1,500 Indian rupees ($18.19) a month.

Now, however, his machine moves on solar power as earlier this month Prajapati’s village of around 6,500 residents, consisting mainly of potters, tailors, farmers and shoemakers, was declared India’s first village to run entirely on solar energy all the time.

“Electricity has helped us to save time and produce more products,” Prajapati said.

India, the world’s third-largest carbon dioxide emitter, aims to meet half of its energy demands from renewable sources, such as solar and wind, by 2030, a boost over its previous target of 40%, the government said it achieved in December 2021.

The project in Modhera, financed by the federal and provincial government at nearly $10 million, involved setting up over 1,300 rooftop panels on residential and government buildings that were connected to a power plant.

The government buys excess energy produced here from residents if they do not use all of the capacity allotted to the households.

With this money, Praveen Bhai, 43, a tailor, plans to buy a gas connection and stove, since many houses in the village cook food in wood-fired stoves that leave a smoky haze.

“I had to teach the kids under the street lamp. Now they will be able to study inside the house.”

Modhera, also known for its ancient Sun Temple dedicated to the sun god, is situated in Prime Minister Narendra Modi’s home state Gujarat, which is holding elections later this year.

“For a self-reliant India of the 21st century, we have to increase such efforts related to our energy needs,” Modi said earlier this month.

For Reena Ben, 36, a housewife, who also works as a tailor part time, the solar power has hugely aided her work.

“When we got access to solar power, I bought an electric motor worth 2,000 rupees ($24) to attach to the sewing machine. Now I am able to sew one or two more clothes daily.” – Reuters

Pope urged to talk of human rights, political prisoners, in Bahrain visit

VATICAN CITY – Families of death row inmates in Bahrain appealed to Pope Francis on Monday to speak out against capital punishment and defend political prisoners during his trip to the Gulf state this week.

The families made their appeal in an open letter released by the London-based Bahrain Institute for Rights and Democracy (BIRD), which called on the pope to speak out on what the group says are human rights abuses, including the imprisonment of pro-democracy dissidents, during his Nov. 3 to 6 trip.

Bahrain has imprisoned thousands of protesters, journalists and activists – some in mass trials – since an anti-government uprising in 2011. It says it prosecutes in accordance with international law those who commit crimes.

“Our family members remain behind bars and at risk of execution despite the clear injustice of their convictions. Many of them were targeted because they took part in pro-democracy protests during the ‘Arab Spring’,” said the letter, written by families of 12 death row inmates.

“During your visit to Bahrain, we hope you can repeat your call to abolish the death penalty and for the sentences of our family members to be commuted,” it said.

Bahrain re-introduced the death penalty in 2017 after a moratorium.

In 2018, the Roman Catholic Church formally changed its teaching to declare the death penalty morally inadmissible and the pope has made many appeals for it to be banned worldwide.

BIRD, a non-profit group, also released an open letter to the pope from Ali Al-Hajee, who defined himself as a “prisoner of conscience” and who is close to completing a 10-year sentence which he said was connected to his participation in a pro-democracy demonstration.

“I invite you, in the name of humanity, to urge the King of Bahrain to abide by peace and to release me and all Bahraini political prisoners,” Al-Hajee’s letter said.

Bahrain rejects criticism from the United Nations and others over conduct of trials and detention conditions. Authorities say its legal and judicial system continues to be reformed.

A Bahrain government spokesperson, in response to a Reuters request for comment, said in a statement that “no individual in the Kingdom is arrested or in custody because of their beliefs” and that the constitution protects freedom of expression.

“However, in cases where individuals incite, promote, or glorify violence or hatred, there is a duty to investigate and, where appropriate, prosecute such individuals,” the spokesperson said, adding the government has “zero-tolerance towards mistreatment of any kind”.

 

ARAB SPRING

US-allied Bahrain was the only Gulf state to experience mass “Arab Spring” upheaval. The Sunni Muslim monarchy used force to suppress protests, led mostly by the Shi’ite Muslim community, and cracked down on sporadic unrest and dissent later.

At a briefing last week, Vatican spokesperson Matteo Bruni was asked if the pope would speak about human rights while in Bahrain, given criticism by the opposition and international rights groups of the state’s treatment of the Shi’ite majority.

“I won’t anticipate anything on what the pope will be saying in the next few days. The position of the Holy See and of the pope concerning religious freedom and liberty is clear and is known,” he said.

The Bahrain government spokesperson said the state protects freedom of religion and worship, and “does not tolerate discrimination, persecution or the promotion of division based on ethnicity, culture or faith”.

The pope is visiting Bahrain for the closing ceremony of “Bahrain Forum for Dialogue: East and West for Human Coexistence” and to meet members of the Catholic community.

He will meet King Hamad bin Isa al-Khalifa and stay in the royal compound because there is no Vatican embassy in Bahrain.

In 2019, Francis visited the United Arab Emirates, the first pontiff to visit the Arabian peninsula and say a Mass there.

Bahrain is about 70% Muslim and, unlike Saudi Arabia, allows the small Christian community – mostly foreign workers – to practice their faith publicly in two churches there. – Reuters

China COVID curbs hit iPhone output, shut Shanghai Disney

UNSPLASH

BEIJING – China’s COVID-19 curbs forced the temporary closure of Disney’s Shanghai resort on Monday, while production of Apple Inc iPhones at a major contract manufacturing facility could drop by 30% in November due to coronavirus restrictions, a source told Reuters.

In Zhengzhou, a Foxconn plant that makes iPhones and employs about 200,000 people has been rocked by discontent over stringent measures to curb the spread of COVID-19, with numerous staff fleeing the facility, prompting nearby cities to draw up plans to isolate migrant workers returning to their home towns.

“There were so many people on the road, as if we were escaping from a famine,” said a Foxconn worker in his 30s surnamed Yuan, who said he scaled fences in order to leave the plant and return to his central China home town of Hebi.

A person with direct knowledge of the matter said iPhone production at the plant could drop as much as 30% in November, and that Taiwan-based Foxconn, formally Hon Hai Precision Industry Co Ltd., is working to boost production at a factory in Shenzhen to make up for the shortfall.

Foxconn on Sunday said it was bringing the situation at the Zhengzhou plant under control and would coordinate back-up production with other plants to reduce any potential impact

In Shanghai, the city’s Disney Resort abruptly suspended operations on Monday to comply with COVID-19 prevention measures, with all visitors at the time of the announcement required to remain until they return a negative test.

Disney said it expedited the testing and that all of its visitors had left its theme park. All of the test results were negative, according to a spokesman, who said Disney is working on plans to reopen.

Videos circulating on China’s Twitter-like Weibo, which could not be independently verified, showed people rushing to the park’s gates, which were already locked. Videos of people fleeing malls and office buildings for fear of being locked-in have become commonplace on Chinese social media this year.

Rising case numbers from outbreaks across China have prompted a tightening of local curbs and lockdowns, including in parts of cities such as the southern metropolis of Guangzhou, as the economic toll of zero-COVID mounts.

Data released on Monday showed that Chinese factory activity unexpectedly fell in October, dragged down by softening global demand and strict domestic COVID-19 curbs, which hit production, travel and shipping in the world’s second-largest economy.

 

COVID OUTLIER

China has shown little sign of laying groundwork that would enable it to retreat from a COVID policy that it says saves lives and that has made it an outlier as much of the rest of the world tries to live with the coronavirus.

At this month’s twice-a-decade Communist Party Congress, President Xi Jinping reiterated China’s commitment to zero-COVID, disappointing investors and countless Chinese frustrated by lockdowns, travel curbs and testing.

“We don’t expect the zero-COVID policy to be abandoned until 2024, which means virus disruptions will keep in-person services activity subdued,” Zichun Huang, economist at Capital Economics, said in a note.

New cases in mainland China hit 2,898 on Sunday, topping 2,000 for a second straight day, a tiny number by global standards.

In Guangzhou, one of China’s biggest cities, the number of new locally transmitted cases totaled 1,110 from Oct. 24-30, up from 402 in the previous seven-day period, with the district of Haizhu, home to 1.8 million people, under lockdown.

A Guangzhou resident named Ye said he was sent to a suburban quarantine hotel after being told on Thursday that he was deemed a close contact by virtue of walking on the same street three days earlier around the same time as someone who tested positive.

“I do not know how they calculated that. Also there is no room for you to query or dispute it,” said Ye, an artist in his 50s.

 

FLARE-UPS

Over the past week, authorities have raced to get a handle on rising cases in cities across China, including Datong, Xining, Nanjing, Xian, Zhengzhou and Wuhan, forcing temporary lockdown measures.

Du Fan, 40, founder of Wuhan Small Animals Protection Association, which won praise from animal lovers during the pandemic’s first lockdown in the central city in early 2020, said his residential compound had been locked down on Saturday.

“My biggest worry at the moment is that if this continues for too much longer, I’m afraid we won’t be able to continue rescuing the animals, because there’s no way to carry out a lot of work,” he said.

In the Chinese-controlled territory of Macau, authorities reinstated curbs including locking down a major casino over the weekend after a handful of cases were detected. Macau had been COVID-free for more than three months.

However, in Beijing the Universal Resort theme park reopened on Monday after being shut last week because one visitor had tested positive for coronavirus. – Reuters

BSP sees 7.1-7.9% inflation in Oct.

A vegetable vendor waits for customers at a market in Quiapo, Manila. — PHILIPPINE STAR/EDD GUMBAN

INFLATION may accelerate as much as 7.9% in October, driven by rising food prices, higher transport fares and the peso depreciation, the Bangko Sentral ng Pilipinas (BSP) said on Monday.

“The BSP projects October 2022 inflation to settle within the range of 7.1% to 7.9%,” it said in a statement.     

If realized, October inflation would exceed the central bank’s 2-4% target for the seventh straight month. This would also be faster than the 6.9% seen in September and 4% in the same month last year.

The upper end of the BSP’s inflation forecast or 7.9% would be the quickest in over 14 years or since the 9.1% print in November 2008.

A BusinessWorld poll of 14 analysts conducted last week yielded a median estimate of 7.2% for annual inflation in October.

“More importantly, inflation is projected to gradually decelerate in the succeeding months as the cost-push shocks to inflation due to weather disturbances and transport fare adjustments dissipate,” the BSP said.   

The Philippine Statistics Authority (PSA) will release October inflation data on Nov. 4.   

“Inflation pressures for (October) are expected to emanate from transport fare hikes, elevated domestic petroleum prices, higher agricultural commodity prices due to recent typhoons, and the depreciation of the peso,” the BSP said. 

In October, the price of gasoline, diesel, and kerosene had a net increase per liter of P0.50, P8, and P4.25 respectively, data from the Energy department showed.

Traditional and modern jeepneys in the same month began implementing the approved fare hike to P12 and P14, respectively. Ordinary passenger buses also hiked the minimum fare to P13.

Prices of agricultural commodities rose in October after a string of typhoons hit the country. Agricultural losses due to Super Typhoon Karding (international name: Noru) reached P3.12 billion, while damage due to Tropical Depression Maymay and Typhoon Neneng hit P594.02 million.   

The peso traded around P58 to P59 per dollar during the month. The local unit went back to the P57 level when it closed at P57.97 on Friday.

“This could be offset in part by the reduction in electricity rates for Meralco-serviced areas, lower LPG (liquefied petroleum gas) prices, and reduction in prices of fish,” the BSP said.   

Manila Electric Co. said the overall rate for a typical household went down by P0.0737 per kilowatt-hour (kWh) to P9.8628 in October.

LPG prices were reduced by P2.55 per kilogram (kg) or an aggregate P28.05 for the standard 11-kg cylinder in October. 

China Banking Corp. Chief Economist Domini S. Velasquez said in a Viber message that it will be “very worrisome” if inflation does hit 7.9% in October, adding that a whole-of-government approach is needed to tackle this issue.

“There are some demand-side inflationary pressures that will be addressed by BSP’s continuous monetary tightening. This is together with providing some stability to the peso to ensure imported inflation is capped,” Ms. Velasquez said.   

“However, the food inflation we are experiencing (highest weight and affects the poor the most), can be addressed by other branches of the government. Sufficient supply of all food items should be a priority, especially in this inflationary environment,” she added.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said inflation is likely to have reached its peak in October as global crude oil prices have declined significantly since March.

He noted recent typhoons that caused agricultural damage may have led to a temporary spike in prices of food and other commodities.

“There would also be relief, reconstruction, reparation, rebuilding, and other rehabilitation activities in hard-hit areas by the storms that could offset any economic output/productivity losses in those areas,” Mr. Ricafort said.

The BSP said it will “continue to monitor closely emerging price developments to enable timely intervention that could help prevent the further broadening of price pressures.”

At its Sept. 22 policy meeting, the central bank raised its average inflation forecast for this year to 5.6% from 5.4% previously, exceeding the 2-4% target.

For 2023, the BSP expects inflation to average 4.1% before easing to 3% in 2024.   

The BSP has so far hiked benchmark interest rates by 225 basis points this year to cool rising prices. Its next policy-setting meeting is on Nov. 17. — Keisha B. Ta-asan

Inflation, interest rates may dampen retail sector growth in 2023

A bazaar is seen inside a mall in Manila, June 12. — PHILIPPINE STAR/KRIZ JOHN ROSALES

By Revin Mikhael D. Ochave, Reporter

THE PHILIPPINE retail sector’s growth is projected to slow next year, as consumer spending will likely be affected by elevated inflation and rising interest rates.

Barsali Bhattacharyya, Economist Intelligence Unit (EIU) industry manager, told BusinessWorld that local retailers will be affected by weaker consumer spending. 

“In 2023, the pace of growth will slow to 2.7% as persistently high inflation and the increase in domestic interest rates hurt consumers’ spending power,” Ms. Bhattacharyya said via e-mail.

The Bangko Sentral ng Pilipinas (BSP) has raised benchmark rates by 225 basis points so far this year to tame inflation and address the peso’s weakness.

Inflation accelerated to 6.9% in September, bringing the nine-month average to 5.1% as prices of food, commodities and utilities continue to rise. The BSP expects inflation to average 5.6% this year, and 4.1% in 2023.

Consumers will have to spend more on food next year, as global commodity prices remain elevated, Ms. Bhattacharyya said.

“High global agriculture commodity prices will force consumers to spend more on food and essentials, pushing up the share of food retail sales to over 59% in 2023. We expect this share to remain above the 2019 levels until at least 2025, underscoring the country’s dependence on food imports,” she said.

This year, the retail sector is seen growing 5.9%, mainly driven by the reopening of the economy and easing of coronavirus disease 2019 (COVID-19) restrictions, Ms. Bhattacharyya said.

“The Philippines’ consumer market has been recovering strongly from the pandemic-induced slowdown. The relaxation of COVID-19 measures bodes well for consumption and in 2022 we estimate retail sales to increase by 5.9% in real terms, stripping off the effect of inflation,” Ms. Bhattacharyya said. 

Online sales will continue to rise in 2023 on the back of increasing digitalization in the country. 

“The strong shift to digitalization seen during the pandemic will continue to gain ground, with online sales of goods forecast to account for 4% of total retail sales in 2023,” Ms. Bhattacharyya said.

Meanwhile, Philippine Retailers Association (PRA) Vice Chairman Roberto S. Claudio said the group has a slightly higher growth forecast for next year, compared with the EIU’s projection.

“We have a higher growth forecast for 2023 at 3.5% owing to further easing of COVID-19 protocols and consumer expenditures with people having more freedom to travel with end of lockdowns and policies to boost local tourism,” he said in a phone interview. 

Mr. Claudio said the retail sector is showing better growth this year as consumers return to malls and shops.

“We’re almost aligned with EIU for 2022 growth rate. This figure was picked from the PRA figures of consumers who are returning to in-store and mall shopping, while online continues to grow but a slower rate than in 2020-2021,” Mr. Claudio said.

He does not expect consumer spending to be significantly affected by rising inflation and interest rates.

“During bad economic conditions, consumers spend more on food, recreations such as alcohol, sports, and outdoor activities. Luxury goods will suffer. People look for escapism during hard times,” Mr. Claudio said.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the growth of the retail sector could reach 6% in 2023, matching the economy’s gross domestic product (GDP) expansion.

The government targets 6.5-8% GDP growth in 2023.

“The further reopening of the economy led to more employment; increased sales and more economic activities, thereby supporting retail sales… Online retail and other business transactions would also be boosted by further reopening of the economy, as these have been accelerated since the pandemic,” Mr. Ricafort said. 

“However, higher prices and spending on food and other basic commodities due to higher global and local inflation, as well as higher interest rates/borrowing costs would offset the growth in retail sales, both online and physical stores, and overall economic growth,” he added.

PHL ICT market seen to hit $21B by 2026 as firms spend more on tech

FREESTOCKS-UNSPLASH

By Arjay L. Balinbin, Senior Reporter

LOCAL BUSINESSES are expected to continue spending on information and communications technology (ICT) next year, as they anticipate rising demand for digital solutions, according to some industry players.

“As micro, small and medium enterprises (MSMEs) secure and make their businesses more resilient and adaptable in the face of future economic disruptions, investments in telco and ICT remain as their top priority in the next one to two years,” KD D. Dizon, head of Globe Business MSME Group, told BusinessWorld in an e-mail interview last week.

“This is especially true for those operating within industries that are at the forefront of digitalization such as education, finance, IT and business process management, wholesale/retail, and the hotel, restaurant, and café sector,” she added.

According to London-based data analytics and consulting company GlobalData Plc, the ICT market in the Philippines is expected to grow at an annual growth rate of 8% to $20.6 billion by 2026, from $14.04 billion in 2021.

The cumulative revenue generation opportunities for ICT in the Philippines between 2022 and 2026 are estimated at $89.98 billion.

“The retail sector is the major contributor to the growth of ICT in the Philippines,” GlobalData’s latest report said.

The IT service management company of the PLDT group, ePLDT, Inc., said it has seen a steady increase in investment in ICT solutions from its enterprise customers compared with last year.

“These are customers who are accelerating their digital transformation to improve customer experience (and) operational productivity, (as well as) reduce operational costs,” ePLDT President and Chief Executive Officer Victor S. Genuino said in an e-mail interview last week.

“We see robust demand for data center, cloud, and cybersecurity solutions,” he added.

In a separate e-mail interview, Cisco Philippines Managing Director Zaza S. Nicart said the company continues to see Philippine organizations digitizing their businesses, automating operations, and using innovative technology to strengthen resilience against unexpected challenges.

“This is not only limited to the private sector. The government is leading the movement towards increased ICT investments in the Philippines,” she added.

The Department of Budget and Management proposed a P12.47-billion budget for ICT and digitalization for next year.

“As we enter a post-pandemic era, we’ll continue to see a growing demand in technology innovations and digital solutions such as cybersecurity, integrated cross-architecture IT and networking infrastructure, and collaboration tools supported by data analytics that will help companies better address employees’ health and well-being needs and promote inclusivity,” Ms. Nicart said.

For Ms. Dizon of Globe Business, the overall proportion of ICT spending to the total budget of MSMEs is likely to significantly increase in the next three years.

She said that finance, education, and healthcare industries are “likely to spend more given the government’s fresh digital push.”

“In particular, in 2023, MSMEs are likely to invest more on ICT as they eye to strengthen their backend with cloud-based ERP (enterprise resource planning) and business process systems to support digital customer interfaces, e-commerce, and hybrid workplace strategies,” Ms. Dizon added.

She also said network and endpoint security solutions will be critical for some key industries for data protection compliance and protection from cyber threats such as phishing and ransomware attacks.

“MSMEs with their own custom applications or are in the IT or app development fields also anticipate more spending on Amazon Web Services, Azure, or the Google Cloud Platform to support digital transformation initiatives,” she said.

For his part, ePLDT’s Mr. Genuino noted customers are “cautiously optimistic.”

“Headwinds such as the surge in fuel prices, rising inflation, and the weakening of the peso are causing anxiety. Having said this, it is an opportune time for enterprise customers to design and implement solutions to optimize their operations. By allowing a strategic partner like ePLDT to manage their digital journey and infrastructure, customers can focus on growing their core business,” he added.

Cisco’s Ms. Nicart said businesses need agility to build quicker and better applications in a world “where everything that can be delivered digitally must be delivered digitally.”

“To support hybrid work, they need to be more collaborative, have more adaptable infrastructure, and connect everything with the highest level of security,” she added.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls.

Sustained growth key to lowering debt-to-GDP ratio

BUILDINGS at the Makati central business district are seen in this file photo. — PHILIPPINE STAR/ MIGUEL DE GUZMAN

THE GOVERNMENT is seen on track to bringing down the share of debt to gross domestic product (GDP) to 61.8% by yearend through sustained economic growth, debt management, and revenue measures.

“The target by the yearend is still achievable if GDP growth rate won’t fall below 6% despite escalating prices and continuously changing peso-dollar rate,” University of Asia and the Pacific Senior Economist Cid L. Terosa said in an e-mail.

Economic managers are aiming to bring down the debt-to-GDP ratio to 61.8% by yearend. This is higher than the 60% debt-to-GDP ratio considered manageable by multilateral lenders for developing economies, and significantly higher than the 39.6% seen at the end of 2019.

As of the second quarter, the debt-to-GDP ratio eased to 62.1%, from the previous quarter’s 63.5%.

“The easing of the debt-to-GDP ratio to 62.1% at the end of June was partly due to the fantastic GDP growth rate achieved by the country in the second quarter of 2022. I think a debt-to-GDP ratio of 62% by the yearend is achievable,” Mr. Terosa said.

He noted the government must sustain economic growth at a level above 6% if it hopes to lower the debt-to-GDP ratio.

Pantheon Chief Emerging Asia Economist Miguel Chanco said slower GDP growth may hinder the efforts to bring down debt levels.

“I think that a target of 61.8% by end-2022 for the national debt-to-GDP is still doable, but it won’t happen automatically. Just to be upfront, though, we currently have a below consensus real GDP growth forecast of 5.6% for this year, so our working denominator for nominal GDP will be very different from the government’s assumptions,” he said in an e-mail.

The National Government’s outstanding debt rose to a record-high P13.02 trillion at the end of August.

The Philippine economy expanded by 7.4% in the second quarter, bringing six-month GDP growth at 7.8%. The government targets 6.5-7.5% GDP growth for this year.

Mr. Chanco said if economic growth is weaker than expected, the government should pursue new revenue-generating measures and spending cuts to achieve lower debt levels.

Mr. Terosa said the government should ensure there is effective debt management.

“The government has to collect more revenues by ‘deepening’ the tax base and to increase revenues by ‘expanding’ the existing tax base. This will entail making government borrowing yield more productive results,” he added.

Economic managers are hoping to lower the ratio to 52.5% by 2028. — Luisa Maria Jacinta C. Jocson

High Street to rise in Azuela Cove

AZUELA COVE recently unveiled the first phase of its High Street, a lifestyle district that will link to the estate’s planned boardwalk. — COMPANY HANDOUT

AYALA LAND, Inc. (ALI) and the Alcantara Group is bringing the “High Street” experience to its Azuela Cove development in Davao City.

ALI and Alcantara Group held a groundbreaking ceremony for Azuela High Street on Oct. 27.

Described as Davao’s seaside lifestyle district, Azuela High Street will offer a mix of retail and dining destinations similar to the Bonifacio Global City’s (BGC) High Street.

“It’s really the right time to expand Azuela Cove. The market is ready and we’re very excited to offer something that will elevate the overall experience in our community. Drawing from the success of our High Street in BGC, we’re excited to bring the same vibrancy here while leveraging the unique seaside location of Azuela. This will truly be some place special once complete,” Jennylle S. Tupaz, ALI vice-president and senior estate development head, said in a statement.

Azuela High Street will rise on a 1.8-hectare park and later will have a 1.8-meter boardwalk that offers Ztate’s greenery.

“The High Street’s indoor and outdoor spaces are also designed to be seamlessly integrated. This way we can amplify the effect of our green spaces and you can expect to be surrounded by nature all throughout Azuela Cove as our indoor spaces are enveloped by garden and sea views,” Ms. Tupaz said.

This new area will also have a 1.2-kilometer jogging path, bike lanes, a basketball court, as well as open spaces for scenic strolls.

Anton M. Hechanova, vice- president of The Alcantara Group, said Azuela High Street will bring Azuela Cove’s retail experience to a new level.

“Commercial developments act as catalysts in key central business districts and townships. They create lifestyle hubs for customers and patrons to enjoy their shopping, dining, and social activities- all in one location. We are very excited to start Azuela High Street and to bring to Davao a complete lifestyle retail development.”

Azuela Cove, a joint venture project of ALI and the Alcantara Group, is a 25-hectare mixed-use complex located along the Davao City Coast facing Davao Gulf and Samal Island.

Azuela already has a retail area called The Shops, which is anchored by G Center, the specialty department store of the Gaisano chain. It also features Pilates Plus Davao, Galerie Raphael, Young Living Essential Oils Experience Center, and other lifestyle brands. — Cathy Rose A. Garcia

PHL’s first ‘naked-eye’ 3D-LED screen unveiled in BGC

SPECTATORS watch the country’s first-ever 3D LED screen in Bonifacio Global City, Oct. 27. — PHILIPPINE STAR/ WALTER BOLLOZOS

THE country’s first “naked-eye” 3D-LED screen was unveiled in Bonifacio Global City (BGC) last week.

The BGC digital billboard, which covers 400 square meters of multimedia display in One Bonifacio High Street, is the Philippines’ version of iconic screens in New York City’s Times Square and Tokyo’s Shibuya Crossing.

“The sensory impact of the BGC digital billboard is expected to engage audiences, transforming them into story-telling participants rather than mere spectators,” Alfie Reyes, Fort Bonifacio Development Corporation chief operating officer, said in a statement.

BGC’s naked-eye 3D-LED screen shows off the latest trend in graphic design and visual arts called anamorphosis. Anamorphic illusion technology combines LED screen and distortion perspective art using advanced display technology and sharp pixels to provide a realistic feel.

“Considering that BGC is known as the home of flagship global and local brands, from culinary delights to the arts, fashion, and lifestyle options, BGC’s anamorphic display promises stories well told and experiences heightened,” Mr. Reyes said.

Disney, Netflix, Globe, Food Panda, and Maya were among the first set of advertisers on BGC’s digital billboard.

Eagle Cement acquisition seen likely to go through

BW FILE PHOTO

MINORITY shareholders of Eagle Cement Corp. are likely to accept the tender offer from San Miguel Corp. (SMC), a credit research provider said, paving the way for the consolidation of two companies led by businessman Ramon S. Ang.

“In general, if indeed SMC’s planned transaction of purchasing an 88.5%-stake in Eagle Cement will not be subject to review by the PCC (Philippine Competition Commission), then it is likely the transaction could go through,” CreditSights Asia-Pacific Corporates Analyst Rohan Kapur said in an e-mail.

The acceptance from minority shareholders is likely “considering the 43% premium to the value of shares, over the share price before the proposed deal was announced, offered to the major shareholders,” he added.

Earlier this month, Eagle Cement’s majority shareholders agreed to sell their holdings to San Miguel Equity Investments, Inc. (SMEII), a unit of SMC.

CreditSights earlier said the acquisition of an 88.5% stake in Eagle Cement might be blocked by the antitrust watchdog, which it said previously blocked a planned acquisition by SMEII of Holcim Philippines, Inc. It said, “a similar outcome may be possible here.”

According to Mr. Kapur, the PCC review was the main concern for the transaction to go through, and receiving the notice from the commission is likely to see the acquisition push through.

Mr. Kapur said the board of SMC has approved the transaction, “and with the PCC green light, there should not be significant hindrances for the deal to go through.”

In a disclosure to the Philippine Stock Exchange, SMC said it received a notice from the PCC on Oct. 27 which said that the acquisition is not subject to the notification requirement under its implementing rules and regulations (IRR).

SMC said that with the issuance, “the transaction shall not be subject to review by the PCC based on the IRR of [the] Philippine Competition Act.”

It added that the next step would be the completion of a mandatory tender offer of SMEII for the acquisition of 11.5% equity interest in Eagle Cement.

“SMC would now need to proceed to make a mandatory tender offer for the remaining 11.5% of Eagle’s shares, which are not owned by Ramon Ang and his family,” Mr. Kapur said.

He said the acquisition would “roughly double SMC’s cement production capacity.”

SMEII and its three subsidiaries have a cement production capacity of 9 million metric tons per annum (mmtpa). If the acquisition pushes through, Eagle Cement’s plant in Bulacan will add 8.6 mmtpa to SMC’s total cement production capacity.

“The acquisition will also create synergies with SMC’s growing infrastructure business, where it is developing various arterial expressways across Luzon, as well as the mega New Manila International Airport,” Mr. Kupar added.

Mr. Kupar said that based on Eagle Cement’s first-half results, SMC could expect its consolidated revenues and earnings before interest, taxes, depreciation, and amortization (EBITDA) to rise by 2% and 4%, respectively.

“Eagle’s acquisition will add a not-so-material contribution to SMC’s existing revenues and EBITDA, according to us,” he added. — Justine Irish D. Tabile

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