Meme stock GameStop jumps on share split bandwagon

July 7, 2022 | 11:41 am

GameStop Corp’s GME.N board has approved a four-for-one stock split that will make it more affordable for investors to own shares of the video-game retailer at the center of last year’s “meme stock” trading frenzy.

Shares of the company shot up 5.8% to $124.49 in extended trading on Wednesday after the announcement.

Several major U.S. companies have opted for stock splits over the past two years, including Apple AAPL.O, Tesla TSLA.O and Amazon.com AMZN.O.

A stock split makes shares more affordable for individual investors by lowering the price without affecting the company’s valuation.

Shares of GameStop skyrocketed more than 680% in 2021 thanks to retail traders on social media platforms such as Reddit who snapped up heavily shorted stocks in a bid to squeeze out hedge funds betting against them.

“GameStop management knows that they have a 100% retail shareholder base and so, they are catering to them,” said Wedbush Securities analyst Michael Pachter.

“It (the stock split) is also a distraction because the NFT market is dead, and that was the last thing that they did that tried to get people excited.”

This year, the video-game retailer’s shares have wound down roughly 20% as the Ukraine crisis and fears of a global recession clouded sentiment.

The company said in March it would seek shareholder approval for the split which would increase its outstanding Class A common shares to 1 billion from 300 million.

Under the split, shareholders will receive a stock dividend of three additional shares of GameStop‘s Class A common stock for each share held. Read full story – Reuters

US counterintelligence warns of China stepping up influence operations

July 7, 2022 | 11:38 am

US_China-flag — CHINESE AND US flags flutter near The Bund in Shanghai, China July 30, 2019. — REUTERS

WASHINGTON – A US counterintelligence agency on Wednesday warned state and local officials that China is intensifying influence operations aimed at manipulating them into pressing the federal government to pursue more Beijing-friendly policies.

China “understands that US state and local leaders enjoy a degree of independence from Washington and may seek to use them as proxies to advocate for national US policies Beijing desires,” the National Counterintelligence and Security Center said in a bulletin sent to state and local officials.

The warning comes amid sharp tensions between Washington and Beijing over a raft of issues. They span from US arms sales to Taiwan and China‘s human rights record to Beijing’s military activities in the South China Sea and alleged espionage operations against the United States.

The Chinese embassy did not respond immediately to a request for comment

US President Joe Biden’s administration views China as a strategic competitor. But it says it is determined to avoid conflict and seeks Beijing’s adherence to international rules and institutions on peace and security.

The new counterintelligence bulletin said that Beijing is using a variety of means to manipulate state and local officials into pressing Washington for policies that are more friendly to China.

“PRC (Peoples Republic of China) influence operations can be deceptive and coercive, with seemingly benign business opportunities or people-to-people exchanges sometimes masking PRC political agendas,” it said.

China‘s approaches include using front groups like the Chinese People’s Association for Friendship with Foreign Countries, which cultivates “sister” relationships between Beijing and US localities, the bulletin said.

Another group, the National Association for China‘s Peaceful Reunification, promotes Sino-US friendship, but advocates Beijing’s views on Taiwan in letters to members of Congress and others, it continued.

The Chinese communist government says it seeks “peaceful reunification” with democratic Taiwan. But it reserves “other options” for the island that it regards as a Chinese province. – Reuters

anello marks 5^th anniversary, celebrates Japanese and Filipino cultures

July 7, 2022 | 11:15 am

Bags can mean different for different kinds of people. A student needs one that can carry all their essentials, while a professional opts for something that can help them look the part. For travelers, the bag has to suit their lifestyle and needs.

Indeed, gone are the days when bags were just a mere accessory. Today, a bag speaks volumes of someone’s personal style. And when it comes to stylish, versatile, and functional bags, only one brand comes to mind: anello.

Taking Japan by storm with Kuchigane Design Rucksack

Introduced in 2005, anello is a Japanese brand with an Italian name that means “annual ring.” The unique bag design comes in a variety of shapes and sizes that are all stylish yet functional. Its most iconic design, the Kuchigane, which is a Japanese word that means “wide mouth opening” offers a huge amount of space when opened, making anello bags ideal for daily use since they can fit all of one’s essentials. It is also surprisingly lightweight and suitable for different kinds of lifestyles.

anello’s Kuchigane design backpack and its succeeding collections have undeniably taken Japan by storm. Its popularity grew massively not only in Japan but also in its neighboring Asian countries, the Philippines included.

Becoming the go-to backpack brand in the Philippines

Everyone was hyped over these Japanese cult favorite bags when the brand reached the Philippine shores in 2017 and opened its first store in SM Megamall. Soon enough, Filipinos would be seen casually slinging their anello backpacks over one shoulder and strutting them on the streets. These trendy bags are everywhere, they’re almost ubiquitous. Opening stores almost every month, the brand now has 57 branches in the Philippines. anello has also launched various collaborations such as the anello x Mickey Mouse and the anello x Winnie The Pooh in 2021.

Just like that, anello bags have become the must-have bag of the moment.

Five years since it launched in the Philippines, the world-renowned Japanese brand continues to showcase its craftsmanship and style, with each bag carrying anello’s signature structured silhouettes. anello has indeed made its mark in the Philippine fashion world as the go-to brand for chic, minimalist, and functional bags.

The popularity of anello bags in the Philippines has also enabled the introduction of Japanese culture among its Filipino consumers. So on the brand’s 5^th anniversary in the Philippines, the celebrations will be marrying the best of both Japanese and Filipino cultures.

Celebrating the beauty of two cultures

To celebrate the beauty of the Japanese brand and the creativity of Filipinos, anello is having a Paint-Your-Bag contest starting June 25 until July 9, 2022 at the @Tokyo Store in Uptown Mall in BGC.

In partnership with one of the best art schools in the Philippines, Global Knowledge College, anello’s Paint-Your-Bag Contest is the first-ever bag painting competition in the brand’s history as well as in the Philippine art scene. The competition aims to highlight the Philippine culture and the talent of aspiring Filipino artists merged with the functionality and subtle elegance of anello. Open to all aspiring local artists and bag enthusiasts, participants are urged to create their own designs inspired by the country’s beautifully diverse flora and fauna as well as its colorful festivities.

anello’s Paint-Your-Bag contest will be judged by multi-awarded Filipino Fine Artist, Professor Aladin Antiqueño, as well as representatives from Global Knowledge College’s Fine Arts Department, United Fine Artists of the Philippines and Philippine Art Restorers Society of the Philippines and Asia.

anello’s Creative Director, Mr. Hiroshi Takemoto will also be joining the list of judges.

1 of 6

Participating local artists will get a chance to win any of the amazing prizes below:

Grand Prize – ₱50K + 100% Scholarship Grant (2-Year Fine Arts degree)
2^ndPlace – ₱25K + 50% Scholarship Grant (2-Year Fine Arts degree)
3^rd Place – P15K + 25% Scholarship Grant (2-Year Fine Arts degree)
10 Consolation Prize Winners – P2k anello Gift Vouchers

All participants will get a Certificate of Participation and Training Discount Vouchers at GK College of Fine Arts. Winners will be announced on July 29, 2022. To know more about the competition, click this https://tinyurl.com/anello-Paint-Your-Bag-contest to read about the mechanics.

More reasons to visit anello stores

If you’re thinking about getting a new anello bag, this is your sign! Get your hands on these unique, hand-painted anello bags made by our aspiring artisans when you visit anello’s art exhibit from July 29 to 31, 2022 at @Tokyo Store, Uptown BGC. Or treat yourself to a new anello bag when you visit one of these stores below:

Metro Manila Branches and Outlets:

@Tokyo ATC	Ayala Malls Feliz
@Tokyo Ayala Bay	Circuit Makati
@Tokyo Century	Festival Mall
@Tokyo Eastwood	Glorietta 3
@Tokyo Estancia	Greenbelt 5
@Tokyo Evia Mall	Landmark TriNoma
@Tokyo SM Mall of Asia	Newport Mall
@Tokyo Market Market	Robinson’s Ermita
@Tokyo Okada	SM Aura
@Tokyo Podium	SM Fairview
@Tokyo Promenade	SM Megamall
@Tokyo Robinson’s Antipolo	SM North Edsa
@Tokyo Robinson’s Galleria	SM San Lazaro
@Tokyo Robinson’s Magnolia	SM Southmall
@Tokyo Shangri-La	Southwoods
@Tokyo SM Manila	TriNoma
@Tokyo SM Sucat	Vertis North
@Tokyo UP Town Center
@Tokyo Uptown BGC

Provincial Branches and Outlets:

@Tokyo Ayala Abreeza	Ayala Malls Cebu
@Tokyo SM Baguio	Fora Tagaytay
@Tokyo SM Daet	SM Mindpro Zamboanga
@Tokyo SM Iloilo	SM Bacoor
@Tokyo SM Lanang	SM CDO
@Tokyo SM Lipa	SM Cebu
@Tokyo SM Naga	SM Clark
@Tokyo SM Olongapo	SM Dasmariñas
@Tokyo SM Roxas	SM Legazpi
	SM Pampanga
	SM Telabastagan
	SM Valenzuela

Stay updated on the latest information when you log on to anello Philippines’ official Facebook page www.facebook.com/anellophilippinesofficial or visit the @Tokyo website https://attokyo.com.ph/collections/anello.

#anellophilippinesofficial

#anello5years

#anellobagart

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Unemployment rate rises 6% in May

July 7, 2022 | 10:31 am

The country’s unemployment rate went up to a three-month high of 6% in May while job quality deteriorated, the Philippine Statistics Authority (PSA) reported on Thursday morning.

Preliminary data from the statistics agency showed this was higher than the jobless rate of 5.7% in April, but remained lower than 7.7% in May last year.

It was the highest unemployment rate recorded since the 6.4% in February this year.

May’s unemployment rate was equivalent to 2.927 million jobless Filipinos in May, up 165,000 from 2.762 million in April.

Job quality deteriorated as the underemployment rate — the proportion of those already working but still looking for more work or longer working hours to the total employed population — rose to 14.5% in May from 14% in April.

It was the highest underemployment rate in two months or since March’s 15.8%.

In absolute terms, this translated to 6.668 million underemployed Filipinos in May, 269,000 more than the 6.399 million the previous month.

The size of the labor force in May was approximately 49.011 million, up by 618,000 from 48.393 million in April. This brought the labor force participation rate (LFPR) to 64% of the country’s working-age population in May improving from 63.4% the previous month.

New entrants to the labor force reached 1.216 million in May, higher than 1.148 million in April.

The employment rate was recorded at 94% in May from 94.3% in April. This was equivalent to 46.084 million employed people in May from 45.631 million previously.

Services sector remained the top employer in May after recording employment rate of 59%, a bit higher than 58% in April. Industry also improved a bit to 19% from 18.4%.

However, employment rate in agriculture eased to 22% in May from 23.6% in April.

On average, an employed Filipino worked 39.8 hours a week in May, decreasing from the 40.1 hours logged the previous month, but higher than the 39 hours in May last year. — A. O. A. Tirona

BPI AMTC welcomes new President and CEO

July 7, 2022 | 9:48 am

BPI Asset Management and Trust Corporation (AMTC), the wealth management arm of the Bank of the Philippine Islands (BPI), announces the appointment of Maria Theresa D. Marcial as its new President and Chief Executive Officer effective June 15, 2022.

Taking the helm of the Philippines’ largest fund house, Marcial is an accomplished banker who brings with her more than 25 years of experience in the Philippine financial services industry, as well as expertise in strategic planning and finance, corporate banking, debt and equity capital markets, and investment management and trust.

“It is an honor to take charge of a company with an unrelenting commitment to provide the investing public with the best options and services that will help them build wealth and reach their goals. Looking ahead, we will continue to pursue excellence in fund management and steer towards the direction of shared success,” Marcial noted.

BPI AMTC sits on a total of over Php 890 billion in assets under management as of March 2022, with 18 percent of the market share in the Philippines. The company is home to 37 multi-awarded and innovative BPI Invest funds that allow Filipinos to access the fastest growing industries in the local and global investment space.

Prior to Marcial’s appointment as President and CEO of BPI AMTC, she held the position of Chief Finance Officer, Chief Sustainability Officer, and Head of Strategy and Finance at BPI, responsible for strategic planning, accounting, financial control, capital management, balance sheet analytics, corporate legal affairs and litigation, and investor relations.

She has also held various leadership positions at the Fund Managers Association of the Philippines, Trust Officers Association of the Philippines, Capital Markets Development Committee of FINEX, Market Governance Board of Philippine Dealing and Exchange Corporation, and the National Advisory Council of World Wide Fund for Nature (WWF) Philippines.

An outdoor enthusiast and true lover of adventure, Marcial is into offshore sailing and yacht racing, open water scuba and wreck diving, underwater exploration and photography, and 4×4 overland adventures and trail driving. Earlier this year, she copped one of the top three awards at the Cruising Class of the recently concluded 2022 BPI Busuanga Cup, one of the longest-running yachting tournaments in the country.

She is also a Fellow of Foundation for Economic Freedom, trustee and treasurer of the WWF Philippines, treasurer of BPI Foundation, and board director of the Philippine Inter-Island Sailing Federation.

Marcial completed the Advanced Management Program at Harvard Business School. She was also recognized as one of Top 25 Most Influential Women in Asset Management in Asia by Asian Investor, and Most Outstanding Alumnus of the University of the Philippines Los Baños.

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ABS-CBN Corp. to conduct annual stockholders’ meeting via remote communication on July 28

July 7, 2022 | 8:01 am

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PHL lags ASEAN in solar, wind energy generation — think tank

July 7, 2022 | 1:01 am

TPEC-Davao-solar-photo-August-2021 — Coca-Cola’s Davao Del Sur plant with close to 4,000 solar panels installed by TeaM Energy

THE PHILIPPINES lags regional peers in terms of the share taken up by solar and wind energy in its power mix, energy think tank Ember said in a report on Thursday.

The Philippines accounts for 10% of power generated in the region, but solar and wind made up only 2.6% of its power mix in 2021, it said.

This is below the 4% average across the Association of Southeast Asian Nations (ASEAN) and the 10% global average, Ember said.

Despite having the second-highest demand growth in the region, only 12% of total electricity demand in the Philippines was serviced by clean sources, it said.

Electricity demand between 2015 and 2021 rose 31%, of which 88% was serviced with fossil fuels, the report added.

While clean electricity generation nearly doubled, power generated from coal power rose 75%.

The share of solar and wind grew from 1.1% to 2.6% during the period, but this was offset by the growth in the share of coal from 27% to 47%, it said.

According to Ember, the Philippine power sector’s CO2 emissions rose accordingly by 42%.

Ember projects the Philippines to increase the share of power generated from solar and wind energy to 16.5% by 2030.

According to the Philippine Energy Plan (2020-2040), the Philippines plans to install an additional 0.76 gigawatts of wind and 18.5 gigawatts of solar power.

Ember said even with these augmentations, solar and wind will only satisfy 38% of the Philippines’ demand in the upcoming decade.

“Solar and wind need to grow rapidly in ASEAN nations, especially considering that they are currently the most economical and fastest way to replace coal,” Ember said. — Diego Gabriel C. Robles

Gov’t tempers 2022 growth target

July 7, 2022 | 12:34 am

THE PHILIPPINE government tempered its economic growth target for this year, as rising inflation and ballooning debt threaten to hamper the economy’s recovery from the pandemic.

Finance Secretary Benjamin E. Diokno on Wednesday said they are now aiming for gross domestic product (GDP) growth of 6.5-7.5% for this year.

This is slightly lower than the 7-8% target set by the Development Budget Coordination Committee (DBCC), but faster than the 5.7% GDP expansion in 2021.

The government also set a 6.5-8% GDP target for 2023 to 2028, higher than the DBCC’s 6-7% goal for 2023 to 2025.

“This is the highest growth rate among all ASEAN+3 countries this year and next year,” Mr. Diokno said at a Palace briefing.

The DBCC is set to review the economic assumptions on Friday.

Mr. Diokno said the new targets are part of a medium-term fiscal framework for 2023-2028, which was approved during the first Cabinet meeting on Tuesday.

“This framework will set the tone, our game plan for the next six years,” he said. “We’re more ambitious.”

The government is targeting to bring down the poverty rate to 9% by the end of President Ferdinand R. Marcos, Jr.’s term in 2028, Mr. Diokno said.

The Duterte administration had initially aimed to bring down poverty rate to 13-15% by 2022, but this was revised to 15-17.5% due to the pandemic. As of the first semester of 2022, the poverty rate stood at 23.7%.

The Finance chief said the debt-to-GDP ratio would be lowered to 60% by 2025. At the end of the first quarter of 2022, the ratio stood at 63.5%, exceeding the 60% threshold that multilateral lenders consider suitable for developing economies.

“We want to show the world that we’re conscious of having sound fiscal management,” Mr. Diokno said.

He added that the government also seeks to lower the deficit-to-GDP ratio to 3% starting 2026.

“We still have a lot of fiscal space, we are confident revenues will pick up,” he added.

Mr. Marcos, 64, is expected to continue his predecessor’s infrastructure program.

“We are committed to spend 5-6% of GDP for infrastructure annually from 2023 to 2028,” Mr. Diokno said, adding that the government would pursue public-private partnerships.

The Philippines is still aiming achieve to upper middle-income status, although Mr. Diokno said this would likely be achieved by the end of Mr. Marcos’ term.

The Philippines had originally targeted to graduate to the upper middle-income status by 2022, but this was derailed by the coronavirus pandemic.

Latest World Bank data showed the Philippines remains a lower middle-income country, as its gross national income (GNI) per capita stood at $3,640 in 2021. This is slightly higher than its $3,430 GNI in 2020.

The World Bank set the income range for the upper middle-income bracket of GNI per capita at $4,256-13,205, higher than the $4,096-$12,695 threshold last year.

TAXES
Mr. Diokno said the Marcos government would push for the completion of the Duterte administration’s Comprehensive Tax Reform Program (CTRP).

“There are two packages left that are revenue-neutral. These will simplify the tax system a lot so we’ll push for that,” he said. “We expect them to be approved before yearend.”

The previous Congress had failed to approve the remaining CTRP packages, which seek to standardize the real property valuation and assessment, and simplify taxes on passive income.

Mr. Diokno, a former central bank governor, also backed taxes on digital services, saying this is “only fair.”

In a separate interview with the ABS-CBN News Channel, Mr. Diokno also mentioned the possibility of imposing a tax on single-use plastics.

“I think we on our part, on the tax side, should think of some measures that we can do to reduce pollution. For example, tax on single-use plastic is worth considering,” he said.

“The Philippines is probably one of the most vulnerable with respect to climate change, and so it is in our own interest that the movement towards climate change should be supported.”

Former Finance Secretary Carlos G. Dominguez III earlier proposed a fiscal consolidation plan that included measures that would generate fresh revenues to pay for the country’s P12.5-trillion debt.

A P20 excise tax per kilogram of single-use plastics is part of package 1 of the fiscal consolidation plan. — Kyle Aristophere T. Atienza with Diego Gabriel C. Robles

PHL bad loan ratio falls to 16-month low

July 7, 2022 | 12:33 am

peso-currency — A worker inspects peso bills inside a money changer in Manila. — REUTERS

By Keisha B. Ta-asan

SOURED LOANS held by Philippine banks declined for a third straight month in May, bringing the nonperforming loan (NPL) ratio to its lowest in 16 months amid improved economic conditions.

Preliminary data released by the Bangko Sentral ng Pilipinas (BSP) on Wednesday showed the banking industry’s gross NPL ratio stood at 3.75%, falling from 4.49% a year ago and 3.93% in April.

The May NPL ratio is the lowest since 3.72% in January 2021.

Bad loans declined by 10.5% to P429.106 billion in May from P479.481 billion a year ago. It was also 4.09% lower than P447.438 billion in April.

Loans are considered nonperforming once they are unpaid for at least 30 days after the due date. They are deemed as risk assets given borrowers are unlikely to settle such loans.

“Improved economic conditions helped firms and households generate enough cash flow to service debt obligations. This in turn helped lower overall NPL,” ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa said in an e-mail.

The government placed Metro Manila and some provinces under the most lenient alert level starting March as the number of coronavirus disease 2019 (COVID-19) infections plunged.

“As the economy continues its recovery, the outlook for the banking sector also improves. Not just in terms of nonperforming loans but also its ability to lend to businesses,” China Banking Corp. Chief Economist Domini S. Velasquez said in a Viber message.

As bad loans declined, the lenders’ gross loan portfolio expanded by 7.3% to P11.44 trillion in May from P10.66 trillion a year ago. It also edged up by 0.4% from the P11.39 trillion in April.

Meanwhile, past due loans dropped by 14.2% to P508.508 billion in May from P593.346 billion a year ago. This brought the ratio to 4.44% from 5.56% a year ago.

Restructured loans climbed by 27.78% to P336.723 billion from P263.514 billion a year ago. These borrowings accounted for 2.94% of banks’ loan portfolio as of May.

In May, banks continued to boost their loan loss reserves to P406.61 billion from P383.39 billion a year ago. This brought the ratio to 3.55%, slightly lower than 3.59% a year ago.

The industry’s NPL coverage ratio, which gauges the allowance for potential losses due to bad loans, improved to 94.76% from 79.96% a year ago.

“The government’s push to support the MSME (micro, small, and medium enterprises) sector and programs and policies to make sure businesses — domestic or foreign -— thrive in the country, will contribute to improvements in the banking sector and the economy,” Ms. Velasquez said.

Mr. Mapa said he expects conditions to improve if economic activity remains robust.

The BSP earlier said the NPL ratio of Philippine banks might peak at 8.2% this year. The ratio stood at 3.99% as of end-December 2021, as the economy started to reopen.

Diokno wants local gov’t units to tap Mandanas funds for agriculture

July 7, 2022 | 12:32 am

Navotas-fish-worker — PHILIPPINE STAR/ MICHAEL VARCAS

THE NATIONAL Government is hoping local government units (LGUs) will channel their expanded budgets into raising agricultural output, Finance Secretary Benjamin E. Diokno said.

Mr. Diokno said in an interview with ANC on Wednesday that LGUs “incidentally have a lot more money now because of the Mandanas ruling,” referring to a Supreme Court (SC) decision that ordered the National Government to make bigger transfers to local governments.

In effect, “there will be a friendly competition among LGUs to boost agricultural products,” Mr. Diokno added.

The Supreme Court’s Mandanas-Garcia ruling granted LGUs a larger share of the national taxes after the SC liberally interpreted the Local Government Code in the LGUs’ favor. The Code requires that any doubt in interpretation must be resolved in favor of more decentralization.

The National Government’s old interpretation of the Code was that LGUs were entitled to 40% of the National Government’s “internal revenue,” which is reflected in the old name of the fund transfers from the National Government to LGUs, the “Internal Revenue Allotment (IRA).”

The Supreme Court ruled that LGUs are entitled to a share of all national taxes, including customs duties, and not just the collections generated by the Bureau of Internal Revenue (BIR). As a result, the IRA is now known as the National Tax Allotment (NTA).

Mr. Diokno added that the policy of importing food to address domestic shortages would continue even after the president said the government would exert greater effort in boosting rice and corn production.

“We will continue to import if demand exceeds supply… for our food requirements and that’s to keep the prices reasonable and affordable for ordinary people.”

“Simultaneously, we plan to increase production, to increase efficiency and planting more — that’s why (President Ferdinand R. Marcos, Jr.) accepted the Agriculture post; he wants to focus on production and he will do that through more sustained productive activity and increasing productivity in the sector.”

Inflation accelerated to 6.1% year on year in June, exceeding the Bangko Sentral ng Pilipinas’ (BSP) 2-4% target for a third straight month. In May, inflation was 5.4%. The year-earlier level was 3.7%.

Food accounts for about 39% of the CPI basket, giving food prices an outsized impact on the movement of the indicator. Food tends to command a bigger share of household budgets in poor countries.

Mr. Diokno described Philippine agriculture as a laggard.

“Industry has been growing, services have been growing but the agriculture sector has been in and out of recession,” he said.

Even if “there’s a budget for the Department of Agriculture, that should not be equated to how much the economy will need to increase agricultural production,” he said.

“As you know, the government is not doing agriculture; it’s the private sector.”

Mr. Diokno also said Mr. Marcos would look into each of the individual subsectors in agriculture — crops, rice, corn, high-value crops and fish.

In June, Mr. Marcos appointed himself Agriculture secretary to address the severe problems facing the farm sector. — Diego Gabriel C. Robles

Businesses concerned over rising electricity rates

July 7, 2022 | 12:31 am

linemen-electric-line — WORKERS fix an electric line in Payatas, Quezon City, March 13. — PHILIPPINE STAR/ MICHAEL VARCAS

THE MARCOS administration should immediately address power supply shortages and high electricity rates, which are affecting businesses in the country, the Philippine Chamber of Commerce and Industry (PCCI) said.

In a statement, PCCI President George T. Barcelon said businesses are concerned over the continued increase in electricity rates and the power supply shortages especially during the summer months.

“But a more pressing concern is our power rate. Industries such as steel, cement and glass have expressed their apprehension to us over how much electricity rates are forecast to increase as supply for reliable baseload like coal, oil and liquefied natural gas (LNG) are becoming scarce commodity,” he said.

Global oil prices soared this year due to the Russia-Ukraine war and tight global supply. LNG prices have also recently jumped.

Mr. Barcelon noted that electricity rates in the Philippines are already much higher than other Southeast Asian countries.

“Studies have shown that electricity rates for residential, commercial and the industrial sectors in the Philippines have been significantly higher from between 25% to as high as 87% than its Association of Southeast Asian Nations (ASEAN) neighbors, namely Malaysia (87.5%), Indonesia (87.5%), Vietnam (50%) and Thailand (36%),” the PCCI said.

Only Japan and Singapore have higher power rates than the Philippines.

Mr. Barcelon said soaring power rates have affected manufacturing industries, who say that fuel and power costs account for 60% of their operational expenses.

The government should ensure that there is “reasonably priced” and steady power supply to be able to attract foreign investments that will create more jobs, the PCCI said.

“For legislation such as CREATE (Corporate Recovery and Tax Incentives for Enterprises) and the amendments to the Public Service Act and Foreign Investment Act to succeed in their intended results to bring back a dynamic production/manufacturing sector, we must effectively solve that ‘high cost of electricity’ impediment soonest, and ensure that there is enough supply to support businesses and industries,” PCCI Chairman for Energy and Power Jose S. Alejandro said.

Mr. Marcos had included energy as one of his administration’s main priorities, along with agriculture, digital infrastructure, and the “Build, Build, Build” program.

“This is a good platform to start taking actions to carve out recovery in new and better than light manufacturing industries for foreign and local investments,” PCCI Director for Energy and Power Franklin A. Carbon said.

The PCCI also urged the Marcos administration to consider renewable energy sources that have “higher proven and acknowledged availability, known technology, no subsidy requirement from either government or consumer to meet reasonable cost to consumers, and can deliver quality, reliable supply to industries.”

The business group also recommended the conservation, rehabilitation, and upgrade of hydropower, geothermal power, and LNG, and to accelerate the approval for new plants that can power industries at affordable costs.

“Addressing the country’s power woes is a big challenge that needs a concrete agenda, commitment and the concerted effort and support of all stakeholders,” the PCCI said.

Mr. Marcos has yet to announce his pick for Energy secretary. — RMDO

Meralco ‘will comply’ with ERC’s refund order

July 7, 2022 | 12:09 am

MANILA Electric Co. (Meralco) has confirmed receipt of an order from the Energy Regulatory Commission (ERC) directing the country’s largest power distribution utility to refund distribution-related charges amounting to P21.8 billion or 87 centavos per kilowatt-hour (kWh) for residential customers.

“We will comply with the ERC’s directive. We are currently studying the order so we can start reflecting this in the power bills this month,” said Joe R. Zaldarriaga, Meralco vice-president and head of corporate communications.

“While we have yet to receive suppliers’ billings, there is a possibility that the refund can offset the expected increase in generation charge and lead to a reduction in the overall power rates for July,” he added.

His comments come after the ERC came out with an order on Wednesday calling for the refund. The regulator placed an average refund rate of 48 centavos per kWh.

Meralco used the residential rate for the amount it plans to refund, while the ERC used the average refund rate.

In its order, the regulator said the amount covers the period from July 2015 to June 2022, and that it will be implemented in the next billing cycle from Meralco’s receipt of the order.

“The Commission has carefully evaluated the case at hand of [Meralco] and considered the views and concerns of the various stakeholders. We are confident that our decision exercised fairness, and promoted the interests of the consuming public who bears the brunt of all these electricity charges,” ERC Chairperson and Chief Executive Officer Agnes VST Devanadera said.

The latest derivative, which was dated on June 16, will be the fourth since January 2021: the first at P13.9 billion was on Jan. 21, 2021; followed by P4.8 billion on Feb. 23, 2022; and P7.7 billion on March 8, 2022.

The ERC further directed Meralco to execute the refund in approximately 12 months or until the amount is fully refunded to its customers.

It also directed the company to include the refund rate as a separate line item in the bills of Meralco’s customers during the refund period.

Adding the latest amount of P21.8 billion, residential consumers now have a P1.80 per kWh of refund.

Meralco is the Philippines’ largest electric power distribution company, with a franchise area covering 9,685 square kilometers.

It provides power to almost 7.3 million customer accounts in 36 cities and 75 municipalities, which include Metro Manila, all of the provinces of Rizal, Cavite, and Bulacan, and parts of the provinces of Pampanga, Batangas, Laguna, and Quezon.

In its first-quarter financial report, Meralco recorded an increase in net profit of 29.9% to P5.66 billion from P4.36 billion in the same period last year.

At the stock exchange, Meralco shares ended lower by P1.00 or 0.28% to P358 apiece on Wednesday.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT, Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls.— Justine Irish DP. Tabile