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Chartered flights from China to Boracay resume 

DOT PHOTO

CHARTERED flights from China to Kalibo, one of the gateways to popular island destination Boracay, resumed last month, giving further boost to the industrys recovery, the Tourism department said on Monday.   

“We are very happy to welcome the resumption of chartered flights from China into Kalibo. This only manifests the fact that Boracay remains a popular destination for Chinese tourists,Tourism Secretary Christina Garcia Frasco said in a statement.   

An OK Airlines chartered flight from Changsha, China arrived in Kalibo on April 18, with a group of 180 Chinese tourists bound for Boracay.   

The Department of Tourism (DoT) said it was the first chartered flight from China since the market reopened for international travel on Jan. 8. 

Together with the local government and our very active private stakeholders, we shall aggressively pursue the promotion of sustainable and responsible tourism in Boracay so that more will come to enjoy its beauty in the long run,Ms. Frasco said.  

China was the top foreign visitor source for the Philippines in 2019, with 1.7 million Chinese tourists recorded that year before the coronavirus restrictions were imposed in March 2020.  

The Philippine government recently adopted visa reforms to ease the entry of  the country’s top markets such as China.   

“The DoT looks forward to equaling, if not surpassing, the number of Chinese visitors we received before the pandemic. We thank our partner agencies especially the Department of Foreign Affairs for heeding our appeal to resume the processing and issuance of Philippine visas to Chinese tour groups,Ms. Frasco said.   

We look forward to other interventions such as the implementation of an electronic visa system to facilitate the ease of entry into the country of our tourists,she added. MSJ 

Hotel industry, retailers mixed on proposed return of face mask mandate

PHILIPPINE STAR/ WALTER BOLLOZOS

HOTEL INDUSTRY associations are mixed on the possible reimposition of the face mask mandate in the Philippines amid the surge in COVID-19 cases in recent weeks.     

Eugene T. Yap, Hotel and Restaurant Association of the Philippines (HRAP) president, on Monday said the group is hoping of not much mask requirement.”    

We hope that there will be not much mask requirement, but I think we now leave it to the establishment,Mr. Yap said during a press conference of the Philippine Furniture Furnishings Market (PFFM) launch.  

Mr. Yap said that mask wearing is still important, especially in the food service sector.   

Right now, I can see the mask is still an important part especially in food serving areas. Many areas, if it is outdoor, you will encounter it less. But mostly in food service area, that will still be very prevalent and very required,he said.   

The Health department recently said that the government may reimpose the mandatory wearing of face masks following a spike in COVID positivity rate.

On May 2, the Health department said that local COVID-19 cases rose 42% to 637 average daily cases during the April 24 to 30 period compared to the 450 average daily cases from April 17 to 23.    

Benito C. Bengzon Jr., Philippine Hotel Owners Association, Inc. (PHOA) executive director, said that member hotels have always observed strict guidelinesset by the government.   

On the part of the hotels, it is fairly simple, we follow the guidelines issued by the governmentThe minimum public health standards have always been in place, and we will abide by the guidelines provided by the government,he said.   

Meanwhile, Philippine Retailers Association (PRA) Chairman Paul A. Santos said shop owners can still require their respective workers to wear a mask.   

We can impose that on our employees because these are workplace safety rules. We can certainly do that. We cannot impose similar standards on our customers,Mr. Santos said.   

While the government may want to recommend that everybody can relax masking, its still up to the individual retailer,he added.    

The PFFM exhibition, set from July 5 to 7 at the SMX Convention Center in Manila, will feature the latest trends on home furniture, outdoor furniture, office and commercial furniture, home décor, and lifestyle products.    

Some of the participating countries include China, Indonesia, Malaysia, Taiwan, Thailand, Vietnam, and the Philippines. The PFFM is projected to attract at least 8,000 trade visitors.   

PFFM is organized by the Malaysia-based organizer Derrisen Sdn Bhd in partnership with various local associations such as the HRAP, PHOA, PRA, Association of Purchasing Managers of Hotels and Restaurants of the Philippines. Subdivision and Housing Developers Association, and the Center for International Trade Expositions and Missions. Revin Mikhael D. Ochave

4 senior police officers face criminal, admin cases over drug links 

PHILIPPINE STAR/EDD GUMBAN

FOUR senior police officers will face criminal and administrative charges over their alleged ties to the illegal drug trade, the Department of the Interior and Local Government (DILG) said on Monday. 

At a livestreamed news briefing, Interior and Local Government Secretary Benajmin C. Abalos, Jr. said the five-man advisory panel recommended the filing of cases after their review of records of third-level police officers. 

“The advisory group recommended the acceptance of the courtesy resignations and filing of administrative and/or criminal cases against two generals and two colonels,” Mr. Abalos said.  

He said the National Police Commission is now waiting for Malacañang to accept the resignation of two generals and two colonels. 

Mr. Abalos said the names of the police officers, who were former members of the Philippine National Police Drug Enforcement Group, would be disclosed once cases have been filed.  

If found guilty of grave misconduct and grave neglect of duty, the officers 

would face dismissal from duty, forfeiture of benefits, and a permanent ban from public office. 

The interior chief in January called on all senior cops to resign after a probe found many high-ranking police officers were involved in the illegal drug trade. 

A total of 953 police generals and colonels have submitted their courtesy resignations, Mr. Abalos said. He said the National Police Commission would continue investigating retired senior cops involved in illegal drugs. 

The five-man advisory panel is composed of former national police chief Rodolfo S. Azurin, Jr., former police officer now Baguio City Mayor Benjamin B. Magalong, ex-Defense Secretary Gilberto C. Teodoro, retired police Major General  R. Nerez, and retired Court of Appeals Associate Justice Melchor Quirino C. Sadang. John Victor D. Ordoñez 

After US, UK trips, Marcos to leave again for ASEAN summit 

PHILIPPINE STAR/KRIZ JOHN ROSALES/PPA POOL

PRESIDENT Ferdinand R. Marcos, Jr. returned to the Philippines Sunday from his quick visit to the United Kingdom for the coronation of King Charles III and his five-day trip to the United States. 

The Philippine leaders arrival in Manila at 10:30 p.m. Sunday was confirmed by the presidential palace in a Viber message to reporters on Monday. 

[There were] no arrival honors,the Presidential Communications Office said. He was welcomed by the chief of protocol and air force officers. 

In a tweet a few hours after his arrival, Mr. Marcos Jr. congratulated King Charles III and Queen Camilla on their coronation in London on May 6, saying the event was grand and magnificent,” “full of symbolism,and weighted by history.”  

It was a great honor for me to represent the Philippines on such a historic occasion,” he said. 

“A day before the Coronation of King Charles III, we were able to speak with His Majesty at the reception, where we sent him the congratulations of all Filipinos,he added.He asked after his friend, my mother, former First Lady Imelda Marcos, and recounted fond memories of the time they shared together. 

Weeks before leaving the Philippines, domestic civic groups urged the president to skip his attendance at the coronation ceremony, saying it does not serve any national interest. 

They cited the ballooningPhilippine debt, which hit a record high of P13.75 trillion at the end of February. 

There were no public details yet on whether the Philippine leader had secured investment pledges or economic partnerships during his UK trip. 

ASEAN MEET
The First Lady, in an Instagram post on Sunday night, said they are scheduled to leave again this week for the annual summit of the Association of Southeast Asian Nations (ASEAN), which will be held in Indonesia. 

Cant believe we have to unpack and then pack again for the upcoming ASEAN meet on Tuesday, May 9th. 

Mr. Marcos left Manila on April 30 for a five-day trip to Washington, where he had separate meetings with President Joseph R. Biden and Vice President Kamala Harris. 

He was joined by Philippine officials including House Speaker Martin G. Romualdez, Trade Secretary Alfredo E. Pascual and Energy Secretary Raphael P.M. Lotilla, among others. 

During the US trip, the Philippines had secured 1.3$ billion in investment pledges that Mr. Marcos said could create around 6,700 jobs for Filipinos.  

The Philippine leader, 65, is the son of the late dictator Ferdinand E. Marcos, who was toppled by a popular uprising in February 1986 after his government plundered public coffers and committed human rights violations, which have been documented by various domestic and international organizations. 

Mr. Biden, who was a US senator in 1986, was part of a committee that declared the 1986 snap elections in the Philippines fraudulent. 

Their meeting came amid increasing tension in the South China Sea and Taiwan Strait. 

Cleve V. Arguelles, president of research firm WR Numero, said the Philippine leaders political baggage would likely shape his foreign policy decisions. 

His willingness to be seen at the global stage could be part of restorationistagenda seeking to rebrand the image of his family, which had been humiliated and abandoned in the past by the international community especially the US which they thought were close allies of the Marcos Sr. administration,Mr. Arguelles said in a note.  

So, I think theyre just re-introducing themselves to the international scene. And this is why President Marcos Jr., as many observed, is willing to get up for these international activities which is more than the usual enthusiasm (or absence of it that) we see in performing his domestic duties.Kyle Aristophere T. Atienza

Isuzu PHL issues recall on select D-MAX, mu-X units as precautionary move 

ISUZU Philippines Corp. (IPC) has issued a recall for 2,273 units consisting of its D-MAX pick-up truck and mu-X sport utility vehicle models as a precautionary measure following an issue with its lower second steering shaft bolt.   

The IPC said in an April 27 advisory posted on the Department of Trade and Industry (DTI) site that 1,579 units of the mu-X and 694 units of the D-MAX under the production period 2020 to October 2022 are covered by the special service campaign, which will involve the re-tightening of the lower second steering shaft bolt.    

The lower second steering shaft bolt of these vehicles may have been tightened below the specified torque value. Given the road conditions in the Philippines, it may possibly loosen over time,the IPC said.    

With this, IPC has the initiative of implementing this service campaign activity to inspect and re-tighten to meet the required torque valve as a precautionary measure,it added.   

The inspection and repair of the affected vehicles under the service campaign will be free of charge.    

Kindly note that not all Isuzu mu-X and Isuzu D-MAZ are affected by this service campaign. We will issue a notification letter to the concerned vehicle owners through registered mail for their information. This service campaign will be announced nationwide,the car manufacturer added. Revin Mikhael D. Ochave 

SCTEX toll revenue up 46% to P3.26B in 2022 

NLEX.COM.PH

THE SUBIC-CLARK-TARLAC Expressway (SCTEX) recorded a 45.9% year-on-year increase in its toll revenue in 2022 to P3.26 billion on the back of resurging local travel, according to state-owned Bases Conversion and Development Authority (BCDA).  

The BCDA, the owner and builder of SCTEX, said in a statement on Monday that last years toll revenue was its highest revenue record by far,exceeding the P2.6 billion collected in 2019 and the P2.23 billion logged in 2021.  

According to the government-owned and controlled corporation (GOCC), the surge in toll revenue is due to the higher number of daily traffic following the easing of pandemic-related border restrictions in 2021 and the uninterrupted serviceability of the major road network.  

The BCDA said its average daily traffic rose 25.8% to 70,894 in 2022 from 56,362 in 2021. The 2022 level also breached the pre-pandemic level average daily traffic of 70,538 in 2019.   

As more people go on revenge traveland more business operations return back to normal, we saw an increase in traffic volume in SCTEX. The BCDA is optimistic that this trend will be sustained as we continue to bounce back from the pandemic,BCDA President and Chief Executive Officer Aileen R. Zosa said.   

The surge in traffic and toll revenues from SCTEXs operations in 2022 also increased the concession fees received by the BCDA from its operations and maintenance partner NLEX Corp.  

Last year, the BCDAs share in SCTEXs revenues stood at P1.63 billion, 58.83% higher than the 2021 level of P1.03 billion. Cumulatively, concession fees collected from NLEX Corp. reached P7.8 billion since 2008,the GOCC said.   

The concession fees collected by BCDA enabled the government to cover its debt payments to the Japan International Cooperation Agency (JICA), which provided the financing support for the construction of the expressway amounting to JP¥59.04 billion,it added.   

The 93.7-kilometer SCTEX connects the Clark Freeport and Special Economic Zone, the Subic Bay Freeport Zone, and the Central Techno Park in Tarlac.   

The BCDA is mandated to assist in strengthening the Armed Forces of the Philippines as well as establishing new cities. The GOCC is also engaged in public-private partnerships to improve public infrastructure such as tollways, airports, seaports, and major real estate developments. Revin Mikhael D. Ochave 

Japanese firm to boost garlic production in Ilocos Norte 

JICA PHOTO RELEASE

A JAPANESE company and a state university in Ilocos Norte in northern Philippines have partnered to pilot a project on garlic cultivation and processing technology, the Japan International Cooperation Agency (JICA) announced. 

Under JICAs private-public partnership (PPP) promotion program, Japanese firm Takara, Inc. and Mariano Marcos State University (MMSU) are working together to boost garlic production. 

“This partnership between Takara and MMSU is part of our endeavor for PPP promotion that brings win-win relationships between the Philippines and Japanese companies,Sakamoto Takema, chief representative of JICA Philippines, said in a statement on Monday. 

This means the Japanese private sector introduces innovative and unique technology and know-how to the Philippines and in return, they learn about new promising markets and are stimulated for future investments,he said. 

JICA said that Takara is in Aomori prefecture, which is known for producing 70% of Japans garlic supply. 

The project will contribute to enhancing the partnership between the Ilocos Norte and Aomori which are equally acknowledged as the garlic capitals of the Philippines and Japan, respectively,JICA said. 

This path-breaking cooperation will play an important role in boosting agriculture development, public-private partnership, job creation and income generation for farmers in the Philippines. Moreover, it will also promote a healthy lifestyle among consumers,Mr. Takema added. Luisa Maria Jacinta C. Jocson

DTI seizes almost P3-M uncertified vape products in Metro Manila  

PHILIPPINE STAR/EDD GUMBAN

THE DEPARTMENT of Trade and Industry (DTI) has seized almost P3 million worth of uncertified vaporized nicotine and non-nicotine products and novel tobacco items in the National Capital Region as part of its enforcement operations.   

In a statement on Monday, the DTI said it seized 9,695 units of the uncertified items worth P2.99 million after the agencys Fair Trade Enforcement Bureau (FTEB) visited 390 physical stores from Feb. 9 to 26.    

Prior to physical inspection, the DTI has conducted surveillance operations. With this, 121 firms were found compliant, while 106 stores were either closed or no longer selling vape products. However, violations were seen among 163 firms, and they were required to submit a written explanation,the DTI said.    

The DTI added that the FTEBs online monitoring unit reported 16,290 non-compliant online vape stores while only 86 online stores were deemed compliant following its monitoring efforts.    

Through these combined efforts, there are already 56 formal charges filed against violators of Republic Act (RA) No. 11900 or the Vaporized Nicotine and Non-Nicotine Products Regulation Act and its implementing rules and regulations (IRR). A case has also been filed against one of the largest e-commerce platforms in the country,the DTI said.    

Under RA 11900 and its implementing rules and regulations, the sale or distribution of vaporized nicotine and non-nicotine products to or by persons under eighteen years of age is illegal.    

According to the DTI, the routine inspections are part of Trade Secretary Alfredo E. Pascuals directive to tighten monitoring over the violations of firms and shops under RA 11900.    

SUGAR
Meanwhile, the DTI said in a separate statement that it is closely monitoringthe prices and availability of refined sugar.   

Last year, the government sought the assistance of various supermarkets to lower sugar prices following supply issues.   

I have already instructed our monitoring teams, led by Trade Undersecretary Ruth B. Castelo to regularly conduct price monitoring of sugar in selected supermarkets,Mr. Pascual said.    

We continuously work with other government agencies, especially the Department of Agriculture, to temper the impacts of inflation toward Filipino consumers and enable them to have access to affordable basic necessities and prime commodities,he added. Revin Mikhael D. Ochave

Opposition lawmakers seek probe on killing of communist leaders 

PHILIPPINE STAR/ MICHAEL VARCAS

HOUSE opposition lawmakers are seeking to investigate grave violations of international humanitarian law allegedly committed by the military against two leaders of the Communist Party of the Philippines. 

The House Makabayan coalition asked the House human rights committee to investigate the deaths of communist party leaders Benito Tiamzon, Wilma Tiamzon, and their eight companions.  

The governments resort to brutality to suppress revolutionaries like the Tiamzons is not a solution to the underlying issues that give rise to armed conflict. These issues include poverty, injustice, lack of sovereignty and independence, and a lack of genuine democracy,the solons said in House Resolution No. 939.  

The 8th Infantry Division of the Philippine Army reported in August last year that Mr. and Ms. Tiamzon were killed in a boat explosion in Catbalogan City, Samar in central Philippines. Search and retrieval operations for the victims did not push through allegedly due to bad weather.  

The Communist Party of the Philippines, however, said on April 20 that the Tiamzon couple were tortured and killed by members of the Armed Forces of the Philippines.   

The resolution also cited the National Union of PeoplesLawyers and the Public Interest Law Center, which called for accountability over the deaths of the so-called Catbalogan 10.”  

The Human Rights Commission also committed to investigate the deaths. 

The Tiamzon couple and other companions were protected persons under international humanitarian law, which Republic Act (RA) No. 9851 or the Philippine Act on Crimes Against International Humanitarian Law, Genocide and Other Crimes Against Humanity defines as prisoners of war or persons deprived of liberty for reasons related to an armed conflictor persons not taking a direct part or no longer taking part in the hostilities in the power of the adverse party,according to the resolution.  

The authors of the resolution are Deputy Minority Leader France L. Castro, Assistant Minority Leader Arlene D. Brosas, and Kabataan Party-list Rep. Raoul Danniel A. Manuel. Beatriz Marie D. Cruz

Palawan, Mindoro called ideal sites for nuclear reactor facilities

DOOSAN HEAVY INDUSTRIES

THE GOVERNMENT is considering small modular reactor (SMR) facilities in Occidental Mindoro and Palawan, the Philippine Nuclear Research Institute (PNRI) said on Monday.

Carlo A. Arcilla, PNRI director, in a Laging Handa briefing, called the two provinces ideal locations for SMRs.

“There’s no supply of electricity… especially at night. How can you attract tourists? It is high time to consider nuclear power in islands that are not connected to the grid,” Mr. Arcilla said.

“SMRs can be placed in small islands that are off-grid,” he added.

Last month, Occidental Mindoro was placed under a state of calamity after power interruptions of as long as 20 hours a day.

The National Electrification Administration has since sealed a two-month deal to bring in additional power for the province at rates subsidized by the government. 

NuScale Power Corp. has expressed its interest in investing in the Philippines. The company describes itself as the global leader in SMR technology.

“It is good that we have offers for SMRs… our energy situation is critical because 50% of our energy is from coal,” he said.

Mr. Arcilla said renewable energy alone cannot provide for the Philippines’ energy needs and needs to be complemented with nuclear power.

He also said that the Philippines can no longer rely on natural gas because the Malampaya gas field, the only indigenous commercial source of natural gas, is expected to start becoming commercially depleted by 2024.

Meanwhile, Mr. Arcilla said that the rehabilitation of the Bataan Nuclear Power Plant (BNPP) remains on the table.

“To run BNPP it will need a political decision then followed by a technical decision. We have offers to rehabilitate the site) from Korea,” he said.

In February, PNRI said that Korea Hydro & Nuclear Power Co., Ltd. offered to revive the BNPP within five years for $1.19 billion. — Ashley Erika O. Jose

DENR may require mining companies’ social dev’t plans to provide for small-scale miners

WIKIMEDIA COMMONS

THE Department of Environment and Natural Resources (DENR) said on Monday that it is studying requiring mining companies to include small-scale miners (SSMs) into their community development projects.

“There must be a way to negotiate the resilience of communities where mining is happening, the social development needs to happen,” Environment Secretary Maria Antonia Yulo-Loyzaga said in a statement.

Mining companies are required to dedicate a percentage of their spending to their host communities according to an approved Social Development and Management Program (SDMP).

“This way inclusivity in terms of the progress of the community as a whole can really be institutionalized,” she added.

Describing the proposal as a “big brother-small brother” strategy, the DENR said such an approach could help large miners better achieve their social development targets.

DENR Administrative Order No. 2010-21 or the Revised Implementing Rules and Regulations of Republic Act or the Philippine Mining Act of 1995 requires mining contractors and permit holders to allocate 1.5% of operating expenses to the SDMP.

Of this allocation, 75% must be dedicated to community development.

Michael T. Toledo, chairman of the Chamber of Mines of the Philippines (CoMP), said the association will await the results of the DENR study but called for the program to undergo a thorough consultation process.

“We believe though that this should be done in consultation with industry associations and, equally important, host communities — the primary SDMP beneficiaries — as such a scheme will affect their share,” he told BusinessWorld via chat.

He said the allocation should cover only accredited SSMs monitored by the DENR, the Mines and Geosciences Bureau and a multi-party monitoring team that would include representatives from large-scale mining firms.

“The large-scale mining industry’s negative image is in large part brought about by illegal mining operations, mostly small-scale,” he said.

“This is why CoMP has in the last dozen years urged the government to take tougher stance against illegal mining activities, particularly unregulated SSM,” he added.

The DENR regulates small-scale miners as authorized by Republic Act No. 7076 or the People’s Small-Scale Mining Act of 1991.

“Illegal SSM does not employ the same stringent safety practices required of legitimate large-scale mining operators,” Mr. Toledo said.

He said that illegally operated SSMs employ child labor, evade taxes, and endanger mine workers as well as the environment.

Global Ferronickel Holdings President Dante R. Bravo said the company is open to the DENR proposal.

“Our SDMP should be inclusive and consistent with the sustainability objective of the mining law and the UNSDG (United Nations Sustainable Development Group). I think it’s a desirable initiative from the DENR,” he said in a text message. — Sheldeen Joy Talavera

Nomura Global cuts 2023 PHL inflation estimate

A woman shops for school supplies in San Mateo, Rizal. — PHILIPPINE STAR/ WALTER BOLLOZOS

NOMURA GLOBAL Markets Research has lowered its inflation forecast for the Philippines due to the lower-than-expected inflation readings over the past two months, which are likely to have persuaded monetary authorities to pause their rate hike cycle earlier than expected.

In a May 5 report Nomura Global Markets Research revised downward its consumer price index (CPI) forecast for the Philippines to 5.3% this year from the 5.8% average it projected in March.

The projection is also lower than the 6% full-year forecast of the Bangko Sentral ng Pilipinas (BSP) full-year forecast for 2023.

The Nomura Global projection was issued in a note, “Philippines: Higher inflation for longer” written by Nomura Global Chief ASEAN (Association of Southeast Asian Nations) Economist Euben Paracuelles and analyst Rangga Cipta. 

“Taking into account the CPI releases (that were) surprisingly lower in the last two months, we reduce our 2023 headline inflation forecast to 5.3% from 5.8%, still above BSP’s 2-4% target,” Nomura Global said.

Headline inflation slowed to 6.6% in April, from 7.6% in March, the Philippine Statistics Agency said.

“However, the trajectory penciled in our new forecast suggests a steeper decline in the second half of the year, with headline inflation falling back to within BSP’s target by September, earlier than our previous forecast of November,” Nomura Global said.

Nomura Global also trimmed its core inflation forecast to 5.7% from 5.9% previously, adding however that core inflation may remain elevated in the coming months.

“We believe the services components and discretionary items will remain sticky for some time, before easing later in the year and becoming more in sync with lower food and energy prices,” it said.

Core inflation slowed to 7.9% in April from 8% in March. The March reading was the highest since December 2000.

“As we argued, some persistence in second-round effects remain evident, and could continue to do so in the near term especially with prolonged increases in electricity rates and transport fare adjustments,” Nomura said.

It also said that as minimum wage negotiations typically take place this month or in June, workers may ask for higher wages due to increased utilities costs and fares.

BSP TO PAUSE ON MAY 18
The central bank may start to keep rates steady at its next policy meeting on May 18 due to easing inflation, Nomura Global added.

The Monetary Board has raised borrowing costs by 425 basis points (bps) since May last year, bringing the key policy rate to a near 16-year high of 6.25% to tame inflation.

“In line with our lower inflation forecasts, we accordingly remove the remaining two 25-bp hikes from our policy rate forecast and now expect BSP to leave (rates) unchanged at 6.25% this year,” Nomura Global said.

It noted that the central bank could also change its inflation assessment to “more balanced” from “tilted heavily to the upside.”

“This would likely mark the end of BSP’s hiking cycle, in our view, although we believe the communication from BSP will still suggest it remaining vigilant against inflation risks,” it said.

The BSP sees full-year inflation averaging 6% this year, before decelerating to 2.9% in 2024.

Nomura Global said the BSP is unlikely to turn “more dovish” and will only start cutting the benchmark interest rate in March next year with the Federal Reserve also expected to start easing by that time.

However, the BSP may cut the bank reserve requirement ratio (RRR) by the second half of the year.

“If headline inflation continues to decline in coming months as we expect, BSP could resume taking steps towards its long-term goal of reducing the RRR to single-digit levels from 12% currently,” Nomura said.

The RRR for big banks is one of the highest in the region. Reserve requirements for thrift and rural lenders are at 3% and 2%, respectively.

“In our view, BSP will also likely make the case for only gradual RRR cuts, so that the impact on monetary conditions will likely be neutral, arguing that this can be offset by greater use of BSP’s new instruments for liquidity absorption, including the term deposit facility,” it said.

A cut in the RRR would represent an operational adjustment to facilitate the BSP’s shift to market-based instruments for managing liquidity, particularly the term deposit facility and the BSP securities.

The BSP has committed to bringing down the RRR of big banks to single digits by this year. — Keisha B. Ta-asan

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