Putin signs decree taking over Russian assets of two foreign firms

April 26, 2023 | 11:20 am

President Vladimir Putin on Tuesday signed a decree establishing temporary control of the Russian assets of two foreign energy firms, signaling Moscow could take similar action against other companies if need be.

The decree – outlining possible retaliation if Russian assets abroad are seized – showed Moscow had already taken action against Uniper SE’s Russian division and the assets of Finland’s Fortum Oyj.

The decree said Russia needed to take urgent measures to respond to unspecified actions from the United States and others it said were “unfriendly and contrary to international law”.

The shares in the two entities have been placed in the temporary control of Rosimushchestvo, the federal government property agency, the decree said.

In February, US Treasury Secretary Janet Yellen said Russia should bear the costs of damage caused by its war on Ukraine, adding though there were “significant legal obstacles” to confiscating major frozen Russian assets.

The CEO of state-owned bank Bank VTB PAO had on Monday said Russia should consider taking over and managing the assets of foreign companies such as Fortum, only returning them when sanctions are lifted.

Rosimushchestvo said more foreign firms could find their assets under temporary Russian control, TASS reported. The agency would ensure the assets were run in accordance with their importance for the economy.

“The decree does not concern ownership issues and does not deprive owners of their assets. External management is temporary in nature and means the original owner no longer has the right to make management decisions,” TASS cited the agency as saying.

Last October European Council President Charles Michel said the EU was looking at using Russian assets frozen under sanctions against Moscow towards rebuilding Ukraine.

Asset sales by investors from “unfriendly” countries – as Moscow terms those that imposed sanctions against Russia following its invasion of Ukraine – require approval from a government commission and, in some cases, the president.

In February, Uniper valued its majority stake in Russian division Unipro at a symbolic 1 euro to reflect the likely chance a planned sale to a Russian buyer would fall through. Fortum had already warned shareholders there was a risk its Russian assets could be expropriated. – Reuters

Biden makes 2024 presidential run official as Trump fight looms

April 26, 2023 | 11:13 am

WASHINGTON – President Joe Biden launched his re-election bid on Tuesday with a promise to protect American liberties from “extremists” linked to former President Donald Trump, who he beat in 2020 and might face again in 2024.

Mr. Biden made his announcement in a video released by his new campaign team that opens with imagery from the Jan. 6, 2021, attack on the US Capitol by Trump‘s supporters.

“When I ran for president four years ago, I said we’re in a battle for the soul of America, and we still are,” Mr. Biden said. “This is not a time to be complacent. That’s why I’m running for re-election.”

“Let’s finish this job. I know we can,” he said.

He described Republican platforms as threats to American freedoms, vowed to fight efforts to limit women’s healthcare, cut Social Security and ban books, and blasted “MAGA extremists.”

MAGA is the acronym for the “Make America Great Again” slogan of Trump, who is the early frontrunner in the Republican primary race. If he wins, he will face off against Biden again in the November 2024 election.

Mr. Biden, 80, must overcome Americans’ concerns about his age in order to win re-election, with 44% of Democrats saying he is too old to run, a Reuters/Ipsos poll completed on Monday found.

Mr. Trump, 76, also faces concerns about his age with 35% of Republicans saying he is too old.

The poll showed that a majority of registered voters don’t want either Mr. Biden or Mr. Trump to run again.

While Mr. Biden‘s approval rating is relatively low, his aides are confident he can beat Trump again. The Reuters/Ipsos poll showed him with a lead of 43% to 38% over his Republican rival among registered voters.

In his campaign video, Mr. Biden squarely targeted Mr. Trump and his allies.

“Around the country, MAGA extremists are lining up to take on those bedrock freedoms, cutting Social Security that you paid for your entire life, while cutting taxes for the very wealthy, dictating what healthcare decisions women can make, banning books, and tell people who they can love, all while making it more difficult for you to be able to vote,” Mr. Biden said.

In the two years since he took over from Mr. Trump, Mr. Biden won Congress’ approval for billions of dollars in federal funds to tackle the COVID-19 pandemic and for new infrastructure, and oversaw the lowest levels of unemployment since 1969, although a 40-year inflation highs have marred his economic record.

Speaking to a meeting of North America’s Building Trades Unions on Tuesday, Biden said his economic plan was working but there is “more to do.” Mr. Biden listed his policy achievements and the crowd chanted “four more years!”

Mr. Biden‘s age makes his re-election bid a historic and risky gamble for the Democratic Party, especially if he faces a much younger Republican candidate.

Democrats already face a tough election map to hold the Senate in 2024 and is the minority in the House of Representatives now.

Mr. Biden would be 86 by the end of a prospective second term, almost a decade higher than the average US male’s life expectancy.

Doctors declared Mr. Biden, who does not drink alcohol and exercises five times a week, “fit for duty” after an examination in February. The White House says his record shows that he is mentally sharp enough for the rigors of the job.

Mr. Biden will be joined in his 2024 quest by his running mate, Vice President Kamala Harris, who is featured prominently in his campaign video.

TRUMP MATCHUP AGAIN?

In a statement about Biden‘s candidacy, Mr. Trump criticized the president over his record on immigration, inflation, and the chaotic US pullout from Afghanistan in 2021.

“American families are being decimated by the worst inflation in half a century. Banks are failing,” Mr. Trump said on his social media platform. “We have surrendered our energy independence, just like we surrendered in Afghanistan,” he said.

Marking a sharp contrast to Mr. Biden‘s campaign announcement, Mr. Trump is on trial in a civil lawsuit this week over writer E. Jean Carroll’s accusation that he raped her in a department store dressing room in the mid-1990s.

The former president, who is not required to attend the trial, has denied raping Ms. Carroll.

Mr. Biden is unlikely to face much competition from inside his party. No senior Democrats have shown signs of challenging him.

Potential and declared Republican presidential candidates have begun framing the 2024 election around cutting back government spending amid still-high inflation, restricting abortion, crime in Democratic-run cities and illegal immigration.

The two leading Republican contenders, Trump and Florida Governor Ron DeSantis, want to limit the access of transgender children to sports teams and gender-affirming medical care, and restrict how schools teach LGBTQ+ issues and America’s history of race.

During a briefing with reporters, White House spokesperson Karine Jean-Pierre at first declined to answer a question about whether Biden would serve out another four-year term if re-elected.

“I wanted to be sure that I didn’t go into 2024 more than is appropriate under the law,” she wrote later on Twitter. “But I can confirm that if re-elected, (Biden) would serve all 8 years.”

Mr. Biden ran a mostly virtual campaign to defeat Trump in the 2020 election as COVID raged.

With pandemic restrictions mostly over in the United States, the 2024 race is likely to be a much different, more physical affair.

After losing to Mr. Biden in 2020, Trump refused to concede defeat, falsely claiming that there had been widespread electoral fraud.

His supporters stormed the US Capitol building in Washington on Jan. 6, 2021, in support of his claims but they failed to halt certification by Congress of Mr. Biden‘s win.

Mr. Biden‘s campaign video suggests he plans to regularly remind voters of those events between now and the next election.

Other Mr. Biden themes may include strong US support for Ukraine in its war against Russia and what the White House says are Republican plans to unravel federal healthcare. – Reuters

New, bigger, and more luxurious Lexus Manila Showroom to rise in Bonifacio Global City

April 26, 2023 | 11:00 am

Lexus Manila Showroom Groundbreaking — Present at the groundbreaking ceremony were (from L-R) Federal Land Vice-President Alvin Ty, Mitsui & Co. Philippines General Manager & Country Chairman Kazuhiro Nomura, Lexus Philippines President Atsuhiro Okamoto, Lexus Manila Vice-Chairman Vince Socco, Lexus Manila President Raymond Rodriguez, Lexus Philippines Vice-Chairman Dr. David Go, ASEC President Theresa Esquivel, and Federal Land Senior Vice-President (Project Development Group) Stephen Comia.

The all-new Lexus Manila showroom will be the pinnacle of the luxury motoring experience for the growing number of Lexus customers

To welcome more customers into the luxurious world of Lexus, a new Lexus Manila Showroom will soon rise still within Bonifacio Global City. This address will be able to accommodate Lexus’s growing clientele as the brand further expands its business in the Country; showcasing Lexus’ unique design language; while providing increased service capacity to better serve valued customers better.

Anticipating the needs of guests is a hallmark of Lexus. This unique form of Japanese hospitality is known as ‘omotenashi’—and it was first embodied in the current Lexus Manila Showroom located at 34^th street. When it opened in 2009, the establishment was built to deliver the finest luxury experience in the Philippines. Soon, the upgraded Lexus Manila showroom will further embody that philosophy with integrated new technologies to fit the changing luxury market. The new Lexus Manila will be located at 8th Avenue, Grand Central Park, BGC Taguig.

Just like the newest brand and guest experience center of Lexus at Mitsukoshi BGC which was opened earlier this year –The design of the facade follows the Lexus L-Finesse philosophy. This signature style draws heavily on the deeply rooted principles of Japanese hospitality and aesthetics, while simultaneously having the ability to expand into a highly dynamic, evolving concept. The design is distinctly Japanese: formal and minimalist with horizontal and clean lines. This straightforward approach evokes beauty and simplicity.

A relaxing sensory experience is at the heart of every Lexus showroom. The ground floor area where the main showroom is located will have a full-height curtain wall glazing accentuated by wood-finished elements.

These treatments add up to the lightness and softness of the façade, and are inspired by Lexus design.

At Lexus, everyone is treated as a valued guest. This elevated hospitality is integral to the brand and utmost effort is given in the name of customer satisfaction. This superlative service at its finest is all part of the luxurious experience and should be expected from the newest Lexus Manila showroom when it opens its doors in the 1^st half of 2024.

To learn more, visit the Lexus website at lexus.com.ph or visit their social media pages on Facebook and Instagram.

To arrange a consultation with your personal sales consultant, visit the Lexus Remote page at https://fal.cn/3eSWW.

You may also download the MyLEXUS App available on both Android and iOS users to receive live updates and access other premium services.

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House panel OK’s estate tax amnesty extension

April 26, 2023 | 12:35 am

THE HOUSE Ways and Means Committee approved on Tuesday a bill seeking to extend the estate tax amnesty period, which is set to end by mid-June, for another two years.

House Bill No. 7409 proposes to extend the period of availment of estate tax amnesty to June 14, 2025, from the current deadline of June 14, 2023.

Ways and Means Committee Chairman and Albay Rep. Jose Ma. Clemente S. Salceda said the tax amnesty has yet to be optimized.

“Families still struggle to comply with documentary as well as cash requirements. Hence, our leadership filed this measure to give more time to our constituents to clear their obligations,” he said during a committee hearing on Tuesday.

The bill was co-authored by House Speaker Ferdinand Martin G. Romualdez, Ilocos Norte Rep. Ferdinand Alexander A. Marcos, Majority Floor Leader Zamboanga City Rep. Manuel Jose M. Dalipe and TINGOG party-list representatives Yedda Marie K. Romualdez and Jude A. Acidre.

If passed into law, this would be the second extension of the estate tax amnesty under Republic Act (RA) No. 11213, which initially ran from 2019 to June 14, 2021. RA 11569, which was approved by the previous Congress, also extended the amnesty period for two years from June 15, 2021 to June 14, 2023.

Mr. Salceda noted the coronavirus pandemic had hampered many families’ attempts to settle their estates, which is why RA 11569 had removed the requirement of proof of settlement in the payment of the estate tax.

“I sincerely hope this will be the last time we extend RA 11213 — because it defeats the purpose of tax compliance if violations will always be forgiven,” Mr. Salceda said.

Erwin Vincent G. Alcala, national executive vice-president of the Philippine Institute of Certified Public Accountants, agreed saying this should be the last extension since the amnesty may be subject to abuse.

The current law gives taxpayers a one-time opportunity to settle unpaid tax obligations covering estates of those of decedents who died on or before Dec. 31, 2017. Under the law, a 6% tax rate is imposed on each decedent’s total net taxable estate at the time of death without penalties.

During the hearing, the Ways and Means Committee approved a provision that would exempt heirs from paying a 6% donor’s tax on any donated estates worth P1 million and below. This is an increase from the current P250,000 threshold under section 99 of the National Internal Revenue Code.

“There’s no longer a need for estate tax because you can already donate to your children before you die rather than ask them to pay a 6% estate tax after you die,” Mr. Salceda said.

The Bureau of Internal Revenue (BIR) had set a P6-billion target collection from the estate tax amnesty.

BIR Assistant Commissioner Maria Luisa I. Belen told the House committee that a total of 133,860 taxpayers have availed of the amnesty from 2019 to present, generating P7.4 billion for the government.

Broken down, 61,566 availed of the first estate tax amnesty from 2019 to June 14, 2021, which yielded P4.89 billion. Since June 15, 2021, the second extension has yielded P2.52 billion from 72,294 individuals so far.

Juanito H. Balbastre III, officer-in-charge of the BIR law and legislative division, addressed concerns that the process of availing the estate tax amnesty is tedious.

“We accept the availment of estate tax amnesty even without the proof of settlement considering it was clearly provided under the law that that requirement can be removed,” he told the committee, citing the BIR’s Revenue Regulations 17-2021.

The House of Representatives aims to pass the bill on second reading when session resumes on May 8. The bill is not included in the Legislative Executive Development Advisory Council’s common legislative agenda. — Beatriz Marie D. Cruz

Digital sector’s share to GDP dips in 2022

April 26, 2023 | 12:34 am

THE DIGITAL SECTOR’S contribution to the Philippine economy slipped in 2022, even as its gross value added (GVA) breached P2 trillion, the Philippine Statistics Authority (PSA) reported on Tuesday.

Citing preliminary data, the PSA said the digital economy contributed 9.4% to gross domestic product (GDP), equivalent to a GVA of P2.08 trillion, last year.

Its contribution to GDP last year was slightly lower than the 9.6% seen in 2021, and the smallest since the earliest available PSA data since 2018.

PSA data showed the digital economy, in absolute terms, grew by 11% or P205.44 billion last year from P1.87 trillion in 2021.

This marked the second straight year of growth after the sector contracted by 11.3% in 2021.

The latest PSA results showed that the digital economy has exceeded the pre-pandemic level of P1.96 trillion seen in 2019.

According to the PSA, the digital economy covers digital transactions such as e-commerce and online media/content.

Nicholas Antonio T. Mapa, senior economist at ING Bank N.V. Manila Branch, said the digital economy’s growth was quite healthy in 2022.

“We can explain the lower contribution to the overall GDP figure to the fact that the real economy (activities outside the digital economy) grew at a much faster pace,” he said in an e-mail.

The Philippine economy expanded by 7.6% last year, the fastest growth since the 8.8% reading in 1976.

Domini S. Velasquez, chief economist at China Banking Corp., said usage of digital technology is bound to increase.

“Traditional businesses continue to ramp up digitalization and the outlook for BPOs (business process outsourcing) remain robust, increasing demand for technology. The DICT’s (Department of Information and Communications Technology) thrust of improving e-governance in government transactions will also help drive the digital economy,” she said in an e-mail.

PSA data showed e-commerce posted the highest growth among the sub-components at 26.5% in 2022, quicker than the 8% in 2021. E-commerce’s share to the economy reached 20%, equivalent to P416.12 billion, in 2022.

Digital media and content grew by 11.8% last year, slightly faster than the 10.1% in 2021. Its contribution to the economy slightly increased to 2.8% or P57.41 billion.

On the other hand, digital-enabling infrastructure’s growth slowed to 7.5% last year from 7.8% in 2021.

Digital-enabling infrastructure contributed 77.2% or P1.6 trillion to the Philippine economy, slightly higher than the P1.49 trillion in 2021. This sub-component covers computers, electronic products, telecommunications services, among others.

In 2022, the number of Filipinos employed in the digital economy rose by 8.2% to 6.05 million from 5.59 million in 2021.

Nearly three-fourths or 4.67 million were employed by companies involved in digital-enabling infrastructure, followed by e-commerce with 1.23 million and digital media/content with 147,984.

Ms. Velasquez said trade tensions between the US and China may weaken electronic imports from China, which is part of the Philippines’ value chain, but this could also divert some US demand to the Philippines.

“Moving forward, there are some headwinds such as the planned imposition of value-added tax (VAT) on digital services and a weaker global outlook which will translate to tepid demand for semiconductors,” she added.

Finance Secretary Benjamin E. Diokno earlier said the proposed VAT digital service providers will generate P13.7 billion in revenues if implemented next year.

The measure has been approved by the House of Representatives but is still pending in the Senate. — Abigail Marie P. Yraola

Philippines drops further in 2023 Chandler Good Government Index

April 26, 2023 | 12:33 am

THE PHILIPPINES’ ranking in a global good governance index worsened after it dropped three spots to rank 66^th out of 104 countries. Read the full story.

Philippines falls in global good governance index

April 26, 2023 | 12:33 am

Bonifacio in Monumento-PHL flag — HONOR GUARDS hold the Philippine flag in Caloocan, Nov. 30, 2020. — PHILIPPINE STAR/ MICHAEL VARCAS

By Kyle Aristophere T. Atienza, Reporter

THE PHILIPPINES’ ranking in a global good governance index worsened after it dropped three spots to rank 66^th out of 104 countries.

The country’s overall score slipped by 0.015 point to 0.469, the third lowest in the East Asia and the Pacific region, according to the Chandler Institute of Governance’s 2023 Chandler Good Government Index (CGGI) released on Wednesday.

This was the Philippines’ worst performance since the annual index started in 2021, when it ranked 61^st. The country placed 63^rd in 2022.

In the Asia-Pacific region, Manila lagged behind Singapore (1^st), New Zealand (10^th), Japan (13^th), Australia (16^th), South Korea (18^th), Malaysia (33^rd), China (36^th), Indonesia (46^th), Thailand (47^th) and Vietnam (49^th).

The Philippines was only ahead of Mongolia (72^nd) and Cambodia (88^th).

Singapore topped the index, followed by Switzerland, Finland, Denmark, Norway, Sweden, the Netherlands, Germany, United Kingdom, and New Zealand.

At the bottom of the list are Venezuela, Zimbabwe, Mali, Nigeria, Lebanon, Mozambique, Burkina Faso, Zambia, Iran, Ethiopia, and Madagascar.

According to the CGGI, the Philippines scored 0.359 in Leadership and Foresight, 0.480 in Robust Laws and Policies, 0.443 in Strong Institutions, 0.554 in Financial Stewardship, 0.536 in Attractive Marketplace, 0.401 in Global Influence and Reputation, and 0.493 in Helping People Rise.

“It is alarming that the ranking of the public sector capability and performance of the Philippines has decreased,” Dennis F. Quilala, a political science professor at the University of the Philippines, said in an e-mail.

“This is more disconcerting given that our neighbors have improved their performances,” he said.

Mr. Quilala noted that compared with 2022, the Philippines scores went down in key areas such as leadership, laws and policies, and financial stewardship.

“Since 2022, ethical leadership, rule of law, quality of the judiciary, capacity of institutions to implement programs, and protection of property rights have been concerns,” he said. “Philippine scores on these indicators are below global standards. It is possible that this year, these have remained below global standards and more indicators have gone down.”

Mr. Quilala said it will be a challenge for the Marcos administration to improve the capacity of the government in providing services to its citizens.

“The CGGI ranking of the Philippines in 2023 provides a guide to what the Marcos administration needs to do in improving the bureaucracy,” he said.

Zy-za Nadine Suzara, executive director of governance think tank I-Lead, said the Philippines’ ranking in global governance indices continue to fall and far below its Southeast Asian neighbors.

“We dropped two notches in this year’s CGGI, falling to the 66^th place, while Vietnam climbed seven notches to 49^th place,” she said. “Indonesia, Thailand, and Vietnam’s ranking are in the middle tier. We are below that.”

Ms. Suzara urged the Marcos administration to work harder to fix government institutions, improve spending efficiency, and drive innovation in strategic areas.

“These are among the key pillars where we lag behind the global average score. Clearly, the President and his administration should address those governance gaps if it wants to generate concrete investment from its foreign trade promotion activities,” she said.

Policy analyst Michael Henry Ll. Yusingco said Filipino voters should look at the index and acknowledge that it’s up to them to change the quality of governance in the country.

“For as long as we vote for bad leaders, our place in this index will never change,” he said.

President Ferdinand R. Marcos, Jr.’s predecessor, Rodrigo R. Duterte, had been criticized for failing to uphold good governance standards during his six-year term, as his administration faced allegations of corruption and human rights violations.

Mr. Marcos is seen veering away from some of Mr. Duterte’s key policies, including the former president’s pivot away from western countries such as the United States.

“What the index implies is that even by the neoliberal bent of the Philippine state when it comes to engaging with economic actors (i.e. prioritizing policies that are market friendly even if they don’t necessarily promote democracy and improve the quality of life), the Philippines under Marcos is failing by that standard,” Hansley A. Juliano, a political economy researcher, said via Messenger chat.

Philip Arnold “Randy” P. Tuaño, dean of the Ateneo School of Government, said that to improve the country’s good governance ranking “we need to eventually improve our capacity to strengthen our ability to respond to events that adversely affect our public institutions.”

BSP launches credit scoring model

April 26, 2023 | 12:32 am

THE BANGKO SENTRAL ng Pilipinas (BSP) has launched a credit scoring model that is expected to enhance credit risk assessment by lenders.

The Credit Risk Database (CRD) Scoring Model was developed as part of a technical cooperation program between the BSP and the Japan International Cooperation Agency (JICA).

It is expected to serve as an additional tool that lenders can use to analyze the creditworthiness of micro-, small-, and medium-sized enterprises (MSMEs).

The CRD utilizes a data-driven approach to boosting lenders’ confidence in financing MSMEs, especially those without credit history or enough collateral, the BSP said.

“The CRD scoring model will [not only] contribute to bridging the funding gap to MSMEs, but it will also enhance credit risk management among financial institutions,” BSP Governor Felipe M. Medalla said at the launch event on Tuesday.

Sakamoto Takema, chief representative of JICA, said the CRD can contribute to the BSP’s goal of enhancing access to finance under the National Strategy for Financial Inclusion.

“The overall goal is to enhance the capacity of credit risk assessment of each financial institution, and to promote risk-based lending rather than collateral based lending. It will strengthen the country’s financial system by expanding and streamlining lending to MSMEs,” Mr. Takema said.

Mr. Takema said JICA has agreed to extend the CRD project period for another year and will extend support for phase 2.

The CRD project was launched virtually in December 2020 at the height of the pandemic. The project has expanded with the help of 32 participating rural and universal and commercial banks.

BSP Deputy Governor Bernadette Romulo-Puyat said the CRD is a tool that may significantly expand credit access of small and medium enterprises.

“MSMEs make up 99.6% of business establishments in the country providing 64.7% of employment to the country’s workforce and contribute about 35.7% to the country’s gross domestic product,” she said.

Mr. Medalla noted that there is a “one-size-fit-all policy” towards lending to small businesses in the country, citing the Republic Act 6977 or the Magna Carta for MSMEs.

“A highly specialized Japanese bank for instance — [which] has less than a hundred employees because they are focused on lending to Japanese firms in the Philippines — are being told to lend to MSMEs and agriculture,” he said, adding that the law becomes a “tax” on foreign investors.

Mr. Medalla said that banks have opted to incur penalties for noncompliance instead of taking on the risks associated with lending to small businesses.

Lenders are mandated by the Republic Act 6977 or the Magna Carta for MSMEs to allocate 10% of their credit portfolio for small businesses to boost the sector — 8% for micro and small enterprises (MSEs) and 2% for medium-sized enterprises.

In April 2020, the BSP allowed MSME loans to be counted as part of banks’ reserve requirements in a bid to boost lending to the sector at the height of the pandemic. — Keisha B. Ta-asan

Philippine central bank expands hedging facility to ease FX risk

April 26, 2023 | 12:31 am

THE Philippine central bank amended its rules to encourage hedging against foreign-exchange risk, easing pressure on the peso which slipped to a four-month low last week.

The monetary authority expanded the coverage of the currency rate risk protection program or CRPP and loosened some requirements to encourage its use. The facility, which allows clients of larger banks to hedge their eligible foreign currency obligations or transactions through non-deliverable forwards, now includes non-trade transactions and investments.

“The lessons from last year’s weakness in the peso show that spillover of risks is inevitable in an increasingly global and interconnected world,” central bank Governor Felipe M. Medalla said in a statement on Tuesday.

The peso fell to P56.40 per dollar on April 20, its lowest since December 1. It has gained in the past three days, trading at P55.499 at 3:26 p.m. local time. The Philippine currency plunged to P59 in 2022.

Amendments in circular dated April 18 include:

Expansion of eligible foreign-exchange obligations and transactions to include non-trade transactions and investments

Aligning documentary requirements with existing regulations on foreign-exchange transactions and removing notarial rules

Operational changes such as the applicable US dollar interest rate to be used in the computation of the non-deliverable forward rate.

“The CRPP should enhance trading in the future,” said Nicholas Mapa, a senior economist at ING Bank N.V. in Manila. While the expanded hedging facility may have aided the peso’s recovery, mid-month corporate demand for dollars has also subsided, Mr. Mapa added. — Bloomberg

First NFT insider-trading trial turns on art instead of stock

April 26, 2023 | 12:10 am

The Brawl 2 by Arya Mularama -OPENSEA.IO

1 of 4

A FORMER product manager at the NFT marketplace OpenSea is set for the first-ever insider trading trial involving digital assets — and the object of his alleged crimes is pop art rather than stock.
Nathaniel Chastain, 32, was responsible for selecting which non-fungible tokens (NFT) would be highlighted. That usually led to an immediate spike in the price of the assets.

Prosecutors say that while OpenSea would keep the identity of featured tokens secret until they appeared on its home page, Mr. Chastain bought dozens of them beforehand and then sold them immediately afterward for as much as five times the purchase price, violating his duty to keep the information confidential.
Jury selection starts Monday in Manhattan federal court and the trial is expected to last one to two weeks.

NOT SECURITIES FRAUD
Most insider trading cases are centered around securities fraud, such as buying stock of a company ahead of a pending acquisition or merger based on information that was supposed to be kept secret, or avoiding losses by dumping shares of a drugmaker after learning about the negative results of a clinical trial before it’s announced to the public.

Mr. Chastain is instead charged with wire fraud, which allows prosecutors to avoid the thorny issue of whether or not an NFT is a security, a question that’s been hotly debated in the world of digital assets.

The government used a similar approach in the first insider-trading case involving cryptocurrency. Ishan Wahi, a former Coinbase Global, Inc. manager, pleaded guilty in February to two counts of conspiracy to commit wire fraud for trading on confidential information he learned about when the exchange was going to list new tokens.

Mr. Wahi faces as long as 20 years in prison on each count when he is sentenced next month, although he agreed to federal guidelines that call for him to serve 36 to 47 months behind bars as part of his plea deal.

A victory in the OpenSea case is likely to encourage further use of the strategy by prosecutors as a tool to ferret out fraud in nontraditional markets while regulations for digital assets are still being crafted.

Mr. Chastain has argued NFTs aren’t securities or commodities and therefore aren’t subject to the government’s theory — and that what he took isn’t misappropriated property, as required by the law, because it had no “inherent economic and market value and is based on the unspoken personal thoughts and ideas of employees.” He also contended that he didn’t commit money laundering because the transactions were done on a public blockchain.

‘MARKETING CONCEPT’
“A marketing concept, such as what should essentially be featured in an art gallery window, which has no determinable economic or saleable value and is based on an employee’s unspoken thoughts — regarding the mere selection of an item for prominent display — does not fit this bill,” Mr. Chastain’s lawyer, David I. Miller, said in a court filing.

A group of more than 300 defense attorneys filed a letter in support of Mr. Chastain’s request to throw out the indictment, saying that a finding that all “confidential business information” is property would “effectuate a breathtaking expansion of federal fraud and criminalize a broad swath of conduct never before thought criminal.”

“It would, indeed, capture virtually every instance of an employee using internal employer information for nonwork purposes,” the group said. “Wire fraud does not reach every employee who diverts ‘confidential’ information received at work to the employee’s own purposes.”

US District Judge Jesse Furman, who is presiding over the trial, rejected Mr. Chastain’s attempts to exclude the phrase “insider trading.” The judge said that while the case may not fit into the traditional mold, the term is still descriptive of his alleged conduct in the case — using confidential information about an asset to trade that asset on a public market.

THE BRAWL 2
Mr. Chastain bought a total of 45 NFTs on 11 separate occasions as part of his scheme, prosecutors said. Some of the works he is accused of profiting from include The Brawl 2 by Arya Mularama, which was featured on OpenSea’s homepage on Aug. 2, 2021, and Flipping and spinning by Russ Morland, which was highlighted about a week later.

The government alleges Mr. Chastain made more than $57,000 in profit from the scheme. Mr. Chastain told his girlfriend in a text message after his arrest that he earned about 19 ethereum from the sales outlined in the indictment, which would be about $35,359 based on a Sunday spot price, but he argues that he never converted the proceeds to dollars and therefore never realized any gain.

Mr. Chastain was asked to resign in September 2021 after the community began questioning whether he was front-running sales and the company instituted policies barring employees from buying or selling featured NFTs while they were being highlighted on the home page. He was arrested in June 2022 and faces as much as 20 years on each count if convicted, although he’s unlikely to serve that much time if found guilty.

The case is USA v. Chastain, 22-cr-305, US District Court, Southern District of New York (Manhattan).

NFTs tied up in Three Arrows collapse to be sold by Sotheby’s

SOTHEBY’s is preparing to sell a collection of digital art recovered by liquidators unwinding failed cryptocurrency hedge fund Three Arrows Capital Ltd.

Auctions and private sales of non-fungible tokens (NFT) in the GRAILS collection, assembled by Three Arrows mostly in 2021, will kick off next month in New York, according to a statement. Pieces up for grabs include Chromie Squiggle #1780 by Snowfro and Ringers #879 by artist Dmitri Cherniak.

The sales will help raise money to repay Three Arrows creditors owed more than $3 billion following its sudden collapse last year. Liquidators sifting through the wreckage have been rounding up assets for months, but have repeatedly said the process is impeded by a lack of cooperation from founders Su Zhu and Kyle Davies.

Three Arrows’ liquidators chose Sotheby’s to sell the digital art because they believe the high-end auction house will be able to maximize the value of the assets, according to a spokesperson for Teneo, the consultancy in charge of winding down the hedge fund. (See the collection here: GRAILS:PROPERTY FROM AN ICONIC DIGITAL ART COLLECTION | Art Auction & Sales | Sotheby’s (sothebys.com)).

The hedge fund assembled much of its collection near the height of a frenzy for NFTs that has since cooled. — Bloomberg

Imagination makes us human — this unique ability to envision what doesn’t exist has a long evolutionary history

April 26, 2023 | 12:09 am

YOU can easily picture yourself riding a bicycle across the sky even though that’s not something that can actually happen. You can envision yourself doing something you’ve never done before — like water skiing — and maybe even imagine a better way to do it than anyone else.

Imagination involves creating a mental image of something that is not present for your senses to detect, or even something that isn’t out there in reality somewhere. Imagination is one of the key abilities that make us human. But where did it come from?
I’m a neuroscientist who studies how children acquire imagination. I’m especially interested in the neurological mechanisms of imagination. Once we identify what brain structures and connections are necessary to mentally construct new objects and scenes, scientists like me can look back over the course of evolution to see when these brain areas emerged — and potentially gave birth to the first kinds of imagination.

After life emerged on Earth around 3.4 billion years ago, organisms gradually became more complex. Around 700 million years ago, neurons organized into simple neural nets that then evolved into the brain and spinal cord around 525 million years ago.

Eventually dinosaurs evolved around 240 million years ago, with mammals emerging a few million years later. While they shared the landscape, dinosaurs were very good at catching and eating small, furry mammals. Dinosaurs were cold-blooded, though, and, like modern cold-blooded reptiles, could only move and hunt effectively during the daytime when it was warm. To avoid predation by dinosaurs, mammals stumbled upon a solution: hide underground during the daytime.

Not much food, though, grows underground. To eat, mammals had to travel above the ground — but the safest time to forage was at night, when dinosaurs were less of a threat. Evolving to be warm-blooded meant mammals could move at night. That solution came with a trade-off, though: Mammals had to eat a lot more food than dinosaurs per unit of weight in order to maintain their high metabolism and to support their constant inner body temperature around 99 degrees Fahrenheit (37 degrees Celsius).
Our mammalian ancestors had to find 10 times more food during their short waking time, and they had to find it in the dark of night. How did they accomplish this task?

To optimize their foraging, mammals developed a new system to efficiently memorize places where they’d found food: linking the part of the brain that records sensory aspects of the landscape — how a place looks or smells — to the part of the brain that controls navigation. They encoded features of the landscape in the neocortex, the outermost layer of the brain. They encoded navigation in the entorhinal cortex. And the whole system was interconnected by the brain structure called the hippocampus. Humans still use this memory system for remembering objects and past events, such as your car and where you parked it.
Groups of neurons in the neocortex encode these memories of objects and past events. Remembering a thing or an episode reactivates the same neurons that initially encoded it. All mammals likely can recall and re-experience previously encoded objects and events by reactivating these groups of neurons. This neocortex-hippocampus-based memory system that evolved 200 million years ago became the first key step toward imagination.
The next building block is the capability to construct a “memory” that hasn’t really happened.

The simplest form of imagining new objects and scenes happens in dreams. These vivid, bizarre involuntary fantasies are associated in people with the rapid eye movement (REM) stage of sleep.

Scientists hypothesize that species whose rest includes periods of REM sleep also experience dreams. Marsupial and placental mammals do have REM sleep, but the egg-laying mammal the echidna does not, suggesting that this stage of the sleep cycle evolved after these evolutionary lines diverged 140 million years ago. In fact, recording from specialized neurons in the brain called place cells demonstrated that animals can “dream” of going places they’ve never visited before.

In humans, solutions found during dreaming can help solve problems. There are numerous examples of scientific and engineering solutions spontaneously visualized during sleep.
The neuroscientist Otto Loewi dreamed of an experiment that proved nerve impulses are transmitted chemically. He immediately went to his lab to perform the experiment — later receiving the Nobel Prize for this discovery.

Elias Howe, the inventor of the first sewing machine, claimed that the main innovation, placing the thread hole near the tip of the needle, came to him in a dream.

Dmitri Mendeleev described seeing in a dream “a table where all the elements fell into place as required. Awakening, I immediately wrote it down on a piece of paper.” And that was the periodic table.

These discoveries were enabled by the same mechanism of involuntary imagination first acquired by mammals 140 million years ago.

The difference between voluntary imagination and involuntary imagination is analogous to the difference between voluntary muscle control and muscle spasm. Voluntary muscle control allows people to deliberately combine muscle movements. Spasm occurs spontaneously and cannot be controlled.

Similarly, voluntary imagination allows people to deliberately combine thoughts. When asked to mentally combine two identical right triangles along their long edges, or hypotenuses, you envision a square. When asked to mentally cut a round pizza by two perpendicular lines, you visualize four identical slices.

This deliberate, responsive, and reliable capacity to combine and recombine mental objects is called prefrontal synthesis. It relies on the ability of the prefrontal cortex located at the very front of the brain to control the rest of the neocortex.

When did our species acquire the ability of prefrontal synthesis? Every artifact dated before 70,000 years ago could have been made by a creator who lacked this ability. On the other hand, starting about that time there are various archeological artifacts unambiguously indicating its presence: composite figurative objects, such as lion-man; bone needles with an eye; bows and arrows; musical instruments; constructed dwellings; adorned burials suggesting the beliefs in afterlife, and many more.

Multiple types of archaeological artifacts unambiguously associated with prefrontal synthesis appear simultaneously around 65,000 years ago in multiple geographical locations. This abrupt change in imagination has been characterized by historian Yuval Harari as the “cognitive revolution.” Notably, it approximately coincides with the largest Homo sapiens‘ migration out of Africa.

Genetic analyses suggest that a few individuals acquired this prefrontal synthesis ability and then spread their genes far and wide by eliminating other contemporaneous males with the use of an imagination-enabled strategy and newly developed weapons.
So it’s been a journey of many millions of years of evolution for our species to become equipped with imagination. Most nonhuman mammals have potential for imagining what doesn’t exist or hasn’t happened involuntarily during REM sleep; only humans can voluntarily conjure new objects and events in our minds using prefrontal synthesis. — The Conversation via Reuters Connect

Andrey Vyshedskiy is a Professor of Neuroscience at Boston University.

Arts&Culture (04/26/23)

April 26, 2023 | 12:08 am

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Museum Foundation holds tour of Batangas

THE MUSEUM Foundation of the Philippines has organized Batangas and Beyond!, a tour that explores the heritage and history of the province, and includes visiting the capital, Batangas City, and neighboring towns of San Jose and Ibaan. The tour will be held on May 6, with a meet up time of 7:30 a.m. at the National Museum of Fine Arts in Manila. The fee of P4,500 per head includes transfers, meals and a special tour program. There will be a walking tour of Batangas City’s old bayan which includes visiting the Museo Puntong Batangan, Plaza Mabini, and the 16th century Basilica of the Immaculate Conception. The tour includes special access to the basilica’s sacristy to view its collection of religious antiquities including the original 18th century silver altar. There will be an al fresco lunch of Batangas specialties at the private Acosta-Pastor residence, a well preserved bahay-na-bato dating to 1883. The tour includes a visit to a traditional women’s weaving community cooperative in the town Ibaan, and a merienda (snack) and guided tour at Vilela’s, a family-run integrated farm and agricultural facility. This tour is supported by the Batangas City Cultural Affairs Committee and Tourism Office. For inquiries and reservations, contact Tanya Pico at executive director@museumfoundationph.org, or call, text, or Viber 0918-901-7500.

New dates added to Ang Huling El Bimbo the Musical

ANG HULING El Bimbo the Musical returned to the Newport Performing Arts Theater last weekend, featuring a new cast, fresh choreography, production, and the iconic songs of the Eraserheads. The show has performances every Friday and Saturday at 8 p.m., and matinee performances every Saturday and Sunday at 3 p.m. this April, with new show dates recently added in May to accommodate more theatergoers. Presented by Newport World Resorts’ production outfit Full House Theater Company, Ang Huling El Bimbo tells the tale of four friends Anthony, Emman, Joy, and Hector in the past and present. Tickets are now available at Newport World Resorts Box Office, TicketWorld, and SM Tickets outlets with prices ranging from P1,079 to P3,776. It is recommended for audiences aged 13 years old and above. For more information on Ang Huling El Bimbo the Musical and its show schedule, visit www.newportworldresorts.com and follow @newportworldresorts and @fullhousetheater on Facebook and Instagram, @nwresorts on Twitter.

Manobo artist holds puppetry workshops

YOUNG actors and actresses from the different parts of Mindanao will gather to learn the tradition and rich heritage of masks and puppetry in the Philippines and beyond on May 1. Entitled Papet, Papet… Pang Bata’t Matanda?, the free lecture-workshop by award-winning Manobo artist Carlito Camahalan Amalla was organized by the Kamayoka Center through the Sining Kambayoka Ensemble (SKE). It is the official folk theater company of Mindanao State University in Marawi. The event is in celebration of the group’s golden anniversary in 2024. The talk is likewise in preparation for the youth’s performances under the Cultural Exchange Program of the Cultural Center of the Philippines (CCP). Mr. Amalla, who currently teaches under the Design Foundation of the School of Arts, Culture, and Performance (SACP) of the De La Salle-College of Saint Benilde, will walk the participants into the vibrant history and culture of masks and puppetry across the world. He will provide an overview of its unique characteristics that makes it distinct from popular counterparts, such as Wayang Golek, a Sundanese puppet art from West Java, Indonesia. Mr. Amalla will likewise discuss its role in storytelling and conveying messages, and the relevance of the art in modern society. He will guide the young artists on how to create their own puppets. The lecture-workshop will conclude with a recital featuring the finished outputs of the participants. Papet, Papet… Pang Bata’t Matanda? will be held at the Mindanao State University, Marawi City.

Call for applications to VLF 18 Writing Fellowship

The Cultural Center of the Philippines (CCP) through the Artist Training Division, is now accepting applications for the Virgin Labfest (VLF) 18 Writing Fellowship Program. Deadline for application is on or before May 16. The VLF 18 Writing Fellowship Program is a two-week mentorship program on the study and practice of dramatic writing for the stage. The fellows will take part in lectures, discussions, and workshops on playwriting and script critiquing. They will also be given tickets to this year’s festival plays, as well as the opportunity to participate in the talkback and interaction with known playwrights and directors. This year, the VLF Writing Fellowship Program will be held from June 13 to 25, onsite at the CCP and other alternative venues, and will culminate with a staged reading of the fellows’ works on June 25, at the CCP. Interested applicants should be a college student or a young professional, 29 years old or below. The applicant should not have any play produced by a professional theater company nor any play published in a literary journal. They must not have won in any national or international playwriting/screenwriting competition. Applications should include: duly accomplished and signed Application Form (download from: https://tinyurl.com/VLF18WFPAppForm), and a sample of their stage plays, full or excerpts. The announcement of accepted applicants is on May 30. There is a registration fee of P2,500. Fellows must be present for the entire duration of the program, rehearsals and performance for the Culminating Showcase. The Virgin Labfest, an annual festival of unpublished, unstaged, untried and untested works of playwrights, directors and actors. For inquiries on the Virgin Labfest 18 Writing Fellowship Program, contact the CCP Artist Training Division via phone at 8832-1125 local 1605 (look for Kris Reyno) or via e-mail at artist.training@culturalcenter.gov.ph.

MO_Space opens 2 exhibits

MO_SPACE presents Lou Lim’s exhibit, “Hands Flower,” at the Main Gallery, and Issay Rodriguez’ “Gathering, Collecting, Ongoingness at Gallery 2 on April 29. Both exhibits will run until May 28. Contemporary artist Lou Lim manipulates liquid qualities of acrylic paint by funneling them down onto the canvas, spilling on the surface area of the immaculate surface, and allowing the drip to flow on all four corners. Meanwhile, the foundation of Issay Rodriguez’s long-term research on the life of bees is at the core of “Gathering, Collecting, Ongoingness,” which features works that introduce the audience to the fundamentals of the artist’s interest in understanding and assessing the inter-specie relations between humans and bees. A series of photographs capturing recent encounters with the Philippine native stingless bees are at the center of this exhibition as Rodriguez aligns the activities of working as an artist to that of bees: forage (gathering), pollinate (collecting or exchanging), and continue doing so as a matter of designation by life’s natural design. These similarities propel Ms. Rodriguez to pursue and engage the studies of bees in her practice as vessels that facilitate “ongoingness” as a relationship between the two. MO_Space is at the 3rd level of MOs Design, B2 Bonifacio High Street, 9th Avenue, Bonifacio Global City, Taguig. The gallery is open daily from 10 a.m. to 7 p.m.

Silverlens opens Santiago Bose exhibit

SILVERLENS has opened the exhibit “SANTIAGO BOSE, Spirited Traces, Part of the series conceived by Dr. Patrick Flores in 2019”. The exhibit is ongoing until May 20. The Santiago Bose exhibition project was conceived to let the body of work of the artist unfold incrementally but also decisively across three iterations. This mode of presenting the decades-long labor of Mr. Bose has given the curator the chance to parse his artistic practice into episodes and turning points, into shifts over time or persistent fascinations through and through. In other words, the oeuvre has played out like a series or relay and has not been unveiled like a monolith or foisted on an audience as a spectacle. In 2024, Silverlens will be publishing a book on Santiago Bose written by Dr. Patrick Flores that will delve into the life and practice of the artist to culminate this series of exhibitions. Silverlens is at 2263 Don Chino Roces Ave. Ext., Makati. It is open Tuesdays to Saturdays, from 10 a.m. to 5 p.m.