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A guide to the Philippine election

(MAY 8, 2022) Parish Pastoral Council for Responsible Voting (PPCRV) national chairperson Myla Villanueva and Comelec chairman Saidamen Pangarungan lead the official launching and blessing of the PPCRV command center inside the University of Santo Tomas in Manila on Sunday. (PHOTO BY MIGUEL DE GUZMAN)

Voting started in the Philippines on Monday to decide thousands of positions across the archipelago, including who will take over from Rodrigo R. Duterte and become its president for the next six years. 

Below is a rundown of what to expect. 

WHAT’S BEING DECIDED? 

The election will choose a president, vice president, 12 senators, 300 lower house legislators, and about 18,000 officials across 7,600 islands, including mayors, governors and their deputies. 

About 67.5 million of the Southeast Asian nation’s 110 million population are eligible voters and most ballots will be cast on election day, with polls open from 6 a.m. to 7 p.m. 

Each voter must select one candidate for each post, from president, vice president and senate, all the way down to their local district councilors. Winners serve three-year terms, except for the president, vice president and senators, who serve six years. 

WHO ARE THE PRESIDENTIAL CONTENDERS? 

Ferdinand “Bongbong” R. Marcos, Jr., 64, the son and namesake of the dictator overthrown in a 1986 “people power” uprising, has been the clear leader in all opinion polls this year. 

A former governor, congressman and senator, Mr. Marcos is a political heavyweight from a family with deep pockets and powerful connections. Critics say him winning the presidency is the Mr. Marcos family’s endgame in whitewashing its past and changing narratives of authoritarianism, plunder and opulent living. 

Mr. Marcos’s campaign message is unity and during recent interviews has been unabashed in praising his late father for his “genius” and leadership. 

His closest rival is Maria Leonor “Leni” G. Robredo, 57, who beat Mr. Marcos in the 2016 vice presidential election. Ms. Robredo is a former human rights lawyer and staunch liberal who as vice president has led campaigns against poverty and gender inequality. She entered politics in 2013 after the death in a plane crash of her husband, a former interior minister. 

Other candidates include Manila mayor Francisco “Isko Moreno” Domagoso, retired boxing champion Emmanuel “Manny” D. Pacquiao and  Panfilo M. Lacson, Sr., a former police chief, although they have consistently trailed in polls. 

ARE PHILIPPINE ELECTIONS CREDIBLE? 

Although vote-buying, political violence and occasional glitches with electronic voting machines have been problems in the Philippines, fraud on the level that would cast doubt on the credibility of polls or their outcome is very unlikely. 

Independent poll monitor the Asian Network for Free Elections concluded that each of the most recent Philippines elections were generally free and fair, with turnout remaining high at about 80%. 

HOW IMPORTANT IS THE OVERSEAS BALLOT? 

Millions of Filipinos have either settled or taken jobs overseas. They collectively remit tens of billions of dollars each year, helping sustain families and drive the Philippine economy. 

As breadwinners, the 1.7 million registered overseas voters — and many more Filipinos holding other nationalities — can be key in influencing the voting choices of their families back home or their communities abroad. 

WHEN WILL WINNERS BE KNOWN? 

Vote-counting starts after polls close and there can be a strong indication of who will be the new president within a few hours via a live, unofficial vote count. 

The election commission is aiming to announce most of the winners by the end of May and those will soon after be confirmed by a proclamation of the current legislature. 

The president-elect has seven weeks before being sworn in, during which time their transition team will work out policy plans and sound out potential cabinet members. 

DOES THE VICE PRESIDENCY MATTER? 

The vice president has no real power unless the president vacates office, but as election running mates, they can be crucial allies in rallying supporters behind presidential candidates. 

Marcos has teamed up with current President Duterte’s daughter, Sara Duterte-Carpio. Her support in the south — historically a weak spot for the Marcos family — could be a game-changer. While her father has not endorsed Mr. Marcos, or any other candidate, he is almost certain to absorb some of the outgoing president’s support. 

The vice president is elected in a separate contest and may not be an ally of whoever becomes president. 

WHAT ABOUT PARTIES? 

In the Philippines, political parties tend to be secondary to personalities, with loyalties shifting easily. 

Family names and endorsements from celebrities, social media influencers and politicians carry enormous weight — far more than party affiliation. 

Widespread defections are anticipated and lawmakers will often ally themselves with whoever becomes president, although rivalries and ideological differences will ensure a political opposition exists. — Reuters

Philippine peso poised for deeper drop as Marcos eyes presidency

BW FILE PHOTO

The Philippines peso is in danger of extending this year’s decline as uncertainty over the policies of the front-runner in Monday’s presidential election adds to economic headwinds.

While Ferdinand “Bongbong” Marcos Jr. is favored by 56% of respondents in a survey conducted from April 16 – 21 by pollster Pulse Asia Research Inc., he scored the second lowest in a Bloomberg poll of investors.

“There is more uncertainty as to where Marcos Jr. stands on key policy issues,” said Euben Paracuelles, chief Asean economist at Nomura Holdings Inc. in Singapore. “His campaign has not said much and he has not attended presidential debates.”

The peso has already fallen about 2.9% against the greenback this year as the central bank mulls when to lift its policy rate from a record low while peers including the Federal Reserve increase the pace of monetary tightening. The nation’s trade deficit has added to downward pressure on the currency and global investors have increased sales of Philippines stocks over the past week.

Bangko Sentral ng Pilipinas Governor Benjamin Diokno, who said on Thursday that supply disruptions warrant closer scrutiny, won’t meet with his board to decide on interest rates until May 19. He’s previously said the central bank may consider a rate increase in June.

In contrast, the Federal Reserve has just raised rates by half a percentage point and flagged that more of the same is coming over the next few months.

Still, with inflation running at 4.9% versus the BSP’s 2-4% target, Diokno could pivot to an earlier hike, which would support the peso. Marcos Jr. could also offer more information on his economic policies if elected, potentially helping the currency.

The late dictator’s son has pledged to focus on small businesses, agriculture, infrastructure and tourism to help the economy recover from the pandemic.

Vice President Leni Robredo, who was his nearest rival in the Pulse Asia survey at 23%, was the top pick to oversee the economy in the Bloomberg poll of investors.

For now though, the peso is vulnerable after cracking initial support last week at 52.495.

“A breach of 53.0 cannot be ruled out, given the ongoing strength of the dollar as the market continues to price in more aggressive tightening by the Fed,” said Irene Cheung, a strategist at Australia & New Zealand Banking Group Ltd. in Singapore. — Bloomberg

Prospect of Marcos revival looms as voting underway

Ferdinand “Bongbong” R. Marcos, Jr. — PHILIPPINE STAR/KRIZ JOHN ROSALES

POLLS opened in the Philippines on Monday in the country’s most divisive presidential election in decades, with the prospect of a once-unthinkable return to rule of the Marcos family, 36 years after they were toppled in a “people power” uprising. 

The election pits Vice President Maria Leonor “Leni” G. Robredo against former senator and congressman Ferdinand “Bongbong” R. Marcos, Jr. for the presidency. 

Opinion polls put Mr. Marcos leading his rival by over 30 percentage points, having topped every poll this year. That means Ms. Robredo will need a late surge or low turnout if she is to win the presidency. 

Voters started lining up long before polls opened at 6 a.m. with polling stations due to operate for longer than usual because of coronavirus disease 2019 (COVID-19) precautions. 

Polls close at 7 p.m. and an unofficial vote count could give an indication of the winner within hours. 

Mr. Marcos, 64, has presented no real policy platform but his presidency is expected to provide continuity from outgoing leader Rodrigo R. Duterte, whose ruthless, strongman approach proved popular and helped him to consolidate power rapidly. 

Ms. Robredo, 57, a former human rights lawyer and staunch liberal, has pledged to improve education and welfare, fight poverty and improve market competition if elected. 

The Commission on Elections (Comelec) said on Monday it has not received reports of any major issues on the ground so far, but there were minor delays to voting in some precincts in the southern provinces of Cotabato and Marawi. 

“Our assumption is everything has been going well because there are no untoward and negative reports so far,” Comelec Spokesperson John Rex Laudiangco told a media briefing. 

Mr. Marcos cast his ballot in his home province of Ilocos Norte, and only briefly spoke to journalists on his way out.   

‘VICTORY OF UNITY’ 

Mr. Marcos is buoyed by the support of many younger Filipinos born after the 1986 revolution, having launched a massive social media offensive in an upbeat campaign that has carried undertones of historical revisionism. 

His supporters and social media influencers have dismissed narratives of plunder, cronyism and brutality under the martial law of his late father as lies peddled by opponents, presenting what his critics say is a different version of history. The Marcos camp has denied running misinformation campaigns. 

Despite its fall from grace, the Marcos family returned from exile in the 1990s and has since been a powerful force in Philippine politics, retaining its influence with vast wealth and far-reaching connections. 

The vote also presents an opportunity for Marcos to avenge his loss to Robredo in the 2016 vice presidential election, a narrow defeat by just 200,000 votes that he sought unsuccessfully to overturn. 

Mr. Marcos has steered clear of debates and has campaigned on a message of optimism and unity, on Saturday telling hundreds of thousands of supporters that he dreamed of a “victory of unity of the entire Philippines”. 

Ms. Robredo has promised supporters better education, healthcare and public services if elected. 

A game-changer in the election could be vice presidential running mate Sara Duterte-Carpio, the incumbent president’s popular daughter, who could transfer some of her father’s huge support to Marcos. The president has not endorsed any candidate. 

About 65 million Filipinos are eligible to vote to decide on a successor to Mr. Duterte after his six years in power. Also up for grabs are about 18,000 posts, from seats in the senate and congress to mayors, governors and councilors. — Reuters

Creating an ecosystem of collaborative growth

By Bjorn Biel M. Beltran, Special Features Writer

Startups have proven instrumental in creating impactful solutions to new, arising problems, particularly during the COVID-19 pandemic, as their nimble and adaptable nature gives them room to explore options and opportunities inaccessible to large companies. However, their same nature hinders them vulnerable to risk.

According to the 2020 Philippine Startup Survey: COVID Edition conducted by PwC Philippines, together with the Department of Trade and Industry, QBO Innovation Hub, and IdeaSpace”, out of the 90 founders interviewed, 48% felt threatened by the pandemic’s impact on their startup, while only 23% consider it as an isolated concern. Their top concerns include the financial impact and effects on operations, a potential global recession, and difficulties in funding. In fact, 20% of the surveyed startups found that they only have enough cash and capacity to sustain their business for more than a year.

Working with big businesses, however, can solve most of such concerns.

The first of the two-part BusinessWorld Insights series themed “Philippine Startups: Moving Forward and Up” gathered key movers in the country’s startup scene to discuss how large businesses and startups build each other up to be more resilient and productive in the new normal.

Joaquin L. San Agustin, senior vice-president for marketing at SM Supermalls, recounted the story of their late founder Henry Sy back when SM was still a fledgling enterprise, and how beneficial it was working with other businesses to boost each other up.

“When Mr. Sy moved beyond the department store into mall development, he also looked for those businesses who were small and wanted to grow. Brands, such as Lydia’s Lechon, Bench, Max’s, and Jollibee, all these were small brands who he convinced to put up shop in his mall so they could grow together. And what success they have become!” he said.

This is the reason SM is still a large supporter of startups to this day. A most recent example is when SM launched The SM StartUp Package late last year, which aimed to provide small online businesses the valuable support they need so they can set up their own shop in an SM mall.

“When Henry Sy started, he, like many of the startups today, had a hard time getting big businesses and banks to support him when he needed to scale up. So really, MSMEs and our love for startups and MSMEs is in our DNA,” Mr. San Agustin said.

Big businesses also benefit from the success of the Philippine startup community. Xavier Marzan, CEO and managing director of F(DEV), explained that large corporations do not necessarily have the means to explore budding opportunities as they appear, and startups could be the answer.

“What startups have brought to our businesses is the culture and mindset on how to attack digital opportunities and move fast in this accelerated digital future. A lot of enterprises and organizations are obviously slower because they have existing processes and ways of working that are apt to optimize their existing businesses, but not necessarily to capture entirely new opportunities. By working with startups, our businesses and our people get to learn things and practices that startups do,” he said.

Reymund Rollan, co-founder and CEO of GrowSari, echoed the sentiment. “What startups are able to bring in is the ability to fail because obviously they’re not that big. Financially, the risk is not that much, so the amount of prototyping, iterating, pivoting, gives the industry space to learn,” he said.

Mr. Rollan further noted that there are numerous problems still present in Philippine society that enterprises large and small can attempt to solve. Working together simply increases their chances of success.

“In a developing market setting, there are enough problems to solve. But any time you do something like that you need the participation of the incumbents, because they are the ones basically running the industries at the moment. The efficiencies and the value that technology brings to the people are things that will benefit everyone,” he said.

Mr. Marzan agreed, pointing out that the weaknesses of a large corporation can be covered by a nimbler startup, and vice versa. “There’s a saying, ‘It takes a village to raise a child’. And this holds true for the very nascent startup ecosystem in the Philippines,” he said.

“This requires a lot of open collaboration between different types of organizations: big enterprises, small businesses, government, non-government, even local and foreign, educational institutions, banks, HR firms, marketing agencies, events companies, you name it. All these players and stakeholders need to work together. Startups are not just about new technologies or new business models. They’re also about new ways of working together.”

This session of #BUSINESSWORLDINSIGHTS is supported by P&A Grant Thornton, Management Association of the Philippines, British Chamber of Commerce Philippines, Philippine Chamber of Commerce and Industry, and The Philippine STAR.

SariSuki: Efficient access to fresh produce through community selling

By Adrian Paul B. Conoza, Special Features Assistant Editor

During the strict lockdowns amid the coronavirus pandemic, existing and new sellers have maximized online channels such as social media platforms and mobile messaging apps to remain connected to customers.

Brian Cu, former co-founder and country head of Grab Philippines, observed this firsthand when his wife started selling food and fresh produce through the Viber messaging app. His wife receives orders form her Viber group, then purchases the orders from the supplier in bulk, and then distributes those items to customers as ordered.

Seeing the potential of this model popularly known as commmunity group buying for small entrepreneurs, Mr. Cu started a unique platform for buying and selling fresh produce and consumer goods within communities, called SariSuki.

Having started just on April last year, SariSuki aims to optimize the community group buying concept for microentrepreneurs and farmers who were hit hard during the pandemic.

“Taking the opportunity of tapping into your personal network of people and selling within your community and the problem of individuals who have lost their jobs [and] livelihoods, we have come up with SariSuki to provide them a means of living by giving them access to thousands of products that [they personally need, while also serving] their community with products of good quality and at good prices,” Mr. Cu told BusinessWorld.

More than providing a new means of living, Mr. Cu added, SariSuki wants to further support the agriculture sector by bringing farmer’s produce closer to consumers.

“Not only is the supply chain lacking in the country to support the movement of fresh produce; our farmers are also often treated as a marginalized sector. I wanted to make an impact there by giving them a market where they can sell their products to through community leaders,” SariSuki’s co-founder and chief executive officer shared.

Individuals who want to sell through SariSuki can sign up on their website (sarisuki.com) to become a community leader, or “Ka-Sari.” Once welcomed to the platform, the Ka-Sari is then given a special link to his or her own virtual sari-sari store, which he or she can share within neighbors or peers (or potential “Ka-Suki’s”) within a village or community. Once the orders come in, SariSuki handles the supply and deliver the items to the community leader. The customers either pick up the items from the community leader or have them delivered.

“Throughout this process, the community leader has not put out a single peso yet of capital, since we are the ones who fund for them up to a certain limit when they start off,” Mr. Cu stressed.

Even with barely a year of operations, SariSuki has now more than 3,000 community leaders on the platform, while more than 80,000 customers have been using the platform.

While achieving initial success, nonetheless SariSuki still sees the need to get deeper into the supply chain by working with farmers and providing them a market through the platform’s community leaders. By achieving these goals, Mr. Cu shared, SariSuki hopes to address issues the farming sector have been facing such as spoilage of unsold produce, rising logistics costs, improper shipping, and smuggling of vegetables.

Moreover, the startup is also aiming to further extend its reach in Mega Manila and enter Visayas and Mindanao markets, although Mr. Cu finds that such expansion requires efficient infrastructure, coupled with finding the right local farmers, butchers, and suppliers.

“To expand, we need infrastructure, our supply chain. And the first thing to do is to make sure the products are strategically located in areas that provide the best service. We want to shorten the distance between the end-user and the source,” Mr. Cu said.

Q1 GDP growth likely picked up — poll

PHILIPPINE STAR/ MIGUEL DE GUZMAN
People enjoy an afternoon stroll along Roxas Boulevard in Manila, May 1. — PHILIPPINE STAR/ MIGUEL DE GUZMAN

By Bernadette Therese M. Gadon, Researcher

THE PHILIPPINE ECONOMY likely expanded in the first quarter thanks to favorable base effects and election spending, but the surge in global oil and commodity prices may have dampened growth momentum.

A BusinessWorld poll of 17 economists conducted last week yielded a gross domestic product (GDP) growth median estimate of 6.7% for the first three months of 2022.

If realized, this would be a turnaround from the 3.8% decline logged in the January to March period last year. However, this would be slower than the revised 7.8% growth in the fourth quarter.

Analyst’s Q1 2022 GDP estimatesThis is also below the government’s 7-9% target range this year.

The Philippine Statistics Authority is scheduled to report the first-quarter GDP print on May 12.

Economists said the rebound in the first quarter was mainly due to base effects, and would have been stronger if there was no strict lockdown to curb the Omicron-driven surge in January.

“[First-quarter GDP] could have been bigger had there been no lockdown in the early part of January 2022 brought about by a slight surge of the pandemic that forced the slowdown in economic operation,” Emmanuel J. Lopez, economist at the Colegio de San Juan Letran Graduate School, said in an e-mail.

He noted the economy was able to recover as the coronavirus disease 2019 (COVID-19) infections plunged and the government further loosened restrictions. Metro Manila and other parts of the country have been under the most lenient Alert Level 1 since March.

Election-related spending may have also given the economy a boost in the first quarter. The official campaign period for national positions kicked off on Feb. 8, while that for local offices started on March 25. Elections will be held today (May 9).

“Retail trade and household consumption increased alongside election-related spending. Though prices of basic commodities especially petroleum products increased due to the Ukraine-Russia war, consumer and private sector spending remained high due to the reclassification of the restrictions to level 1,” De La Salle University Economist Mitzie Irene P. Conchada said in an e-mail interview.

The Russia-Ukraine war sent oil and commodity prices soaring to multi-year highs since late February, amid supply concerns. Russia is the world’s second-largest producer of crude oil, while Ukraine is one of the top exporters of maize (corn) and wheat.

Rizal Commercial Banking Corp.’s (RCBC) Michael L. Ricafort said in an e-mail that the further reopening of the economy and achieving the lowest quarantine level by March was a step towards “greater normalcy.”

“We think that the economy shrugged off the potential negative impact of the Omicron-related surge in early January as evidenced by the continuing expansion of PH’s PMI (Purchasing Managers’ Index),” said Ruben Carlo O. Asuncion, chief economist from UnionBank of the Philippines, in an e-mail. “Domestic demand has continued to improve, and we think this is so because again of the economy’s reopening.”

The Philippine manufacturing PMI continued to expand this year, hitting a three-year high in March.

Economists are still keeping a close eye on the Russia-Ukraine war and the pandemic in the next few months.

“We think the Philippine economy will continue to normalize for the rest of the year, as activity normalizes amid low (COVID-19) cases and higher vaccination rates. That said, the headwinds facing the domestic economy have risen,” Makoto Tsuchiya, assistant economist from Oxford Economics Japan, said.

Mr. Tsuchiya noted the Philippine economy faces risks arising from elevated global commodity prices, slower vaccination rollout, and recent lockdowns in China that have disrupted supply chains.

UnionBank’s Mr. Asuncion said these factors can weigh on economic recovery.

“With so much uncertainty all over, it is very difficult to determine if the government will hit its 2022 growth target,” UnionBank’s Mr. Asuncion said.

High inflation due to soaring pump prices may hurt consumer spending, which accounts for around three-fourths of the economy, for the rest of the year.

Bank of the Philippine Islands Lead Economist Emilio S. Neri, Jr. said as long as oil prices remain near current levels, “a return to 2019 output can still be attained by the end of this year.”

“Since the Philippines is still in the midst of exiting from one of the strictest pandemic restrictions in the world, the country’s GDP growth in 2022 will largely be driven by the faster recovery of the businesses hardest hit by the lockdowns,” Philippine National Bank Economist Alvin Joseph A. Arogo said.

“As such, the drag of higher inflation on consumer spending due to the Russia-Ukraine war can largely be outweighed by the economic reopening,” he added.

China Banking Corp. Chief Economist Domini S. Velasquez said consumer spending will be “less robust” for the rest of the year due to elevated inflation and supply chain bottlenecks in China.

“External demand will soften as the outlook for global growth dims,” she said.

Meanwhile, S&P Global Market Intelligence APAC Chief Economist Rajiv Biswas said Philippine economic growth will continue to improve this year, driven by domestic demand.

However, the country’s export sector faces headwinds from weaker Europe and China growth, he said. China is one of the country’s top export markets, while the European Union accounts for about 10%.

“This creates a double blow to the Philippines export sector outlook in the near-term,” Mr. Biswas said.

Security Bank Corp.’s Chief Economist Robert Dan J. Roces said the outcome of the upcoming national elections and its new economic team “will be the key in assessing direction of sentiment which in turn affects growth.”

As PHL votes, experts say good governance is crucial for recovery

PHILIPPINE STAR/KRIZ JOHN ROSALES
A voter’s guide is posted in front of the Commission on Elections office in Arroceros, Manila. Fi The national and local elections will be held today (May 8). — PHILIPPINE STAR/KRIZ JOHN ROSALES

By Kyle Aristophere T. Atienza, Reporter

THE NEXT Philippine president needs to immediately restore public trust in the government, strengthen democratic rule, and pursue major economic and political reforms, analysts and industry experts said on Sunday.

Filipinos will head to the polls today (May 9) to choose a new set of leaders who will oversee the economy’s recovery from the pandemic.

“The campaign period evolved to be very divisive, which the next president should successfully address by building coalitions from an array of political forces,” said Robin Michael U. Garcia, a political economy professor at the University of Asia and the Pacific.

“Compromises have to be made to achieve stability toward post-pandemic recovery,” he said in a Messenger chat.

Cielo D. Magno, a professor at the University of the Philippines’ School of Economics, said there is so much “uncertainty” in the economy right now because the two leading presidential candidates are significantly different in terms of their economic plans.

Political observers said that the 2022 presidential contest has become a two-way race between the only son and namesake of the late dictator Ferdinand E. Marcos and Vice-President Maria Leonor “Leni” G. Robredo.

Ms. Magno noted that investors are likely to continue their investment plans in the Philippines should Ms. Robredo win given her “solid” economic recovery plan.

“On the other hand, we hear Ferdinand Marcos, Jr. making irresponsible promises which shows his lack of understanding of basic economics and current trends,” she said.

“The challenge for the next administration would be to restore investor confidence, manage the pandemic well and adopt sound policies that would help the economy recover. We need the administration to champion good governance and the rule of law,” she added.

The Philippine economy is poised to bounce back from the pandemic this year, with the government projecting a 7-9% gross domestic product (GDP) expansion.

However, multilateral agencies gave below-target forecasts for Philippine growth due to the impact of the Russia-Ukraine war and the ongoing pandemic. The International Monetary Fund (IMF) gave a 6.5% GDP growth projection for the Philippines this year, while the Asian Development Bank and the World Bank gave 6% and 5.7% growth estimates, respectively.

A GlobalSource Partners Philippines note dated May 2 said the next administration needs to build on the Duterte administration’s reforms to attract more investments and to achieve the pre-pandemic GDP growth of 6-7%.

Ms. Magno said Mr. Duterte’s successor needs to craft a clear policy on how to attract big investments and sustain existing ones, particularly in the information technology – business process outsourcing (IT-BPM) industry.

“Unreasonable policies like removing incentives if workers will not physically report to office should be abandoned,” she said, referring to a directive requiring registered IT-BPO enterprises and many of their workers to return to the office.

Francisco “Coco” Alcuaz, Jr., executive director of the Makati Business Club, said Mr. Duterte’s populist attacks on some sectors of the business community and “favoritism for others” have made investors wary of investing and expanding in the country.

“The next president will need to make unmistakable statements and actions to reverse that and accelerate job creation,” he said in a Viber message. “We believe democracy remains the best environment to create jobs and improve lives. Losing democracy and freedom would be expensive.”

Zyza Nadine Suzara, a public finance expert and executive director of I-Lead, said Mr. Duterte will step down by the end of June with a record amount of debt, which swelled to a record high P12.68 trillion as of end-March.

“The next administration should manage the debt by improving revenue management and expenditure management,” she said in a Messenger chat.

Ms. Suzara said the next Philippine leader should implement public financial management reforms that will not only strengthen revenue collection efforts but will also fix public expenditures and government spending performance.

“The next president should do away with wasteful spending, plug leakages in the national budget and spend on the most urgent needs to keep the debt from skyrocketing, she said, adding that a culture of good governance and institutionalized transparency would boost business confidence.

The next president should craft a “people-centered” and “inclusive” national budget that will drive recovery, Ms. Suzara said. She noted the next government will face a number of fiscal challenges, such as finding funds for health, education and social protection programs.

Ibon Foundation Executive Editor Rosario de Guzman said the next administration should immediately conduct an audit on government borrowings as it has been observed that barely 10% of the borrowings have gone to the pandemic response.

“The next president should have a comprehensive program that capacitates the economy and ensures that debt is productive and eventually payable,” Ms. De Guzman said in a Messenger chat. “This includes leading investment in value-adding sectors such as agri-fishery, manufacturing, social infrastructure, small auxiliary enterprises.”

The Philippines has borrowed P1.31 trillion and received grants worth P2.7 billion for its coronavirus response from 2020 to Jan. 14, 2022.  

BUSINESS CONCERNS
For Philippine Exporters Confederation, Inc. Chairman George T. Barcelon, the next administration should streamline the requirements for exporters and relax the rules on bonded warehouses as they continue to face supply chain disruptions.

“With the worldwide congestion and the disruptions in supply chain that led to the increase of shipping costs, the challenges facing the exporters must be addressed,” he said by telephone.

Mr. Barcelon said the next Philippine leader should have a strong experience in working with both the public and private sectors to address the challenges in the export industry.

Foundation for Economic Freedom (FEF) president Calixto V. Chikiamco said the next president should also immediately address the country’s energy supply issues, food insecurity and high inflation.

“The next administration should also take advantage of favorable geopolitical events, such as the deglobalization as the West decreases links to China and shifts production to ‘trusted’ partners and the rising demand for minerals due to the shift toward electric vehicles,” he said in a Messenger chat.

FOREIGN POLICY
The Philippines is a key stakeholder in the conflict in the South China Sea, a key global shipping route that is subject to overlapping territorial claims involving other Southeast Asian nations.

“The election of a new president provides an opportunity to re-evaluate the direction of the Philippines’ foreign policy considering strategic alliances and partnerships, and its role in global and regional affairs,” said Dindo C. Manhit, president of think tank Stratbase ADR.

He said the next administration should immediately formulate a new national security strategy based on a United Nations-backed arbitral ruling in 2016 that invalidated Beijing’s claims to more than 60% of the sea based on a 1940s map.

“A strategic Philippine foreign policy must consider economic diplomacy as one of the means to harness the contribution of both state and non-state actors in national development and international diplomacy,” Mr. Manhit said in a Messenger chat.

“We should enhance security partnerships with countries that share our democratic values and leverage on existing and newly formed multilateral organizations that are committed to maintain the rules-based international system.”

The next administration should also lay the foundations for long-term reforms while addressing urgent concerns, Michael Henry Ll. Yusingco, a research fellow at the Ateneo de Manila University, said.

Mr. Yusingco said the next six years could either be a repeat of the Duterte administration or an elevation of crackdown on dissent “in the name of national unity.”

“Or it could be six years of all of us working towards institutional reforms with clear and achievable goals in mind.”

Robredo bandwagon banks on grassroots to battle Marcos juggernaut

PHILIPPINE STAR/ MIGUEL DE GUZMAN
Supporters of presidential aspirant Vice-President Maria Leonor “Leni” G. Robredo attend a rally along Diosdado Macapagal Boulevard in Pasay City, April 24. — PHILIPPINE STAR/ MIGUEL DE GUZMAN

By Kyle Aristophere T. Atienza, Reporter

TENS OF THOUSANDS of Filipinos intensified their house-to-house campaign in the homestretch of the Philippine presidential election to persuade more voters to choose a perceived underdog.

They will find out in the coming weeks after the May 9 elections whether the effort was enough for Vice-President Maria Leonor “Leni” G. Robredo to overtake the frontrunner — Ferdinand “Bongbong” R. Marcos, Jr., the son of the late dictator.

“This appropriation of the people’s campaign and its use of people-to-people operation will be an inspiration for other parties and campaign organizations,” said Arjan P. Aguirre, who teaches political science at the Ateneo de Manila University. That’s if she wins.

Ms. Robredo’s grassroots political campaign could inspire smaller parties and alternative political forces in the future to contest well-oiled politicians like Mr. Marcos, he said in a Facebook Messenger chat.

The opposition leader, a lawyer and activist who entered politics after her husband’s death a decade ago, beat Mr. Marcos by a hair in the 2016 vice-presidential race. He protested the results for alleged cheating but failed after the Supreme Court rejected his lawsuit five years later.

Ms. Robredo’s pink-themed campaign rallies drew hundreds of thousands of supporters — workers, activists, farmers and young people. She also received endorsements from popular celebrities, beauty queens and church leaders in the predominantly Catholic nation.

On Tuesday night, social media turned pink as her supporters changed their profile pictures with a pink frame.

But she continues to face an uphill battle against Mr. Marcos, who has dominated presidential opinion polls.

“I joined the person-to-person campaign because I want to move past the online campaign and do ground work,” Josiah Quising, a fresh lawyer from Far Eastern University, said in a Twitter message. “Online campaigns have limits.”

The campaign reminds supporters that the goal is to win more votes by not antagonizing people.

“What makes a tao-sa-tao (person-to-person) approach effective is pakikipag-kapwa (fellowship) — a value deeply rooted in the Filipino psyche,” said Ver Reyes, a psychologist who heads the graduate school of the Pamantasan ng Lungsod ng Marikina.

“It involves interdependent skills such as pakikipag-usap (communications), pakikinig (listening) and pagpupukaw (awakening),” she said in a Messenger chat. “And these skills entail a strong level of commitment from the campaigners because it is very taxing, physically and mentally.”

Ms. Reyes said it is never easy to deal with people who have picked a candidate, so campaigners should be sensitive and mindful to be able to convert people.

Mr. Marcos kept his 56% score in the Pulse Asia Research, Inc.’s April presidential opinion poll. Ms. Robredo remained at a distant second with 23%.

Her camp said the poll didn’t capture Ms. Robredo’s rally near Manila, the capital that drew a record 400,000 supporters on April 23.

“By now, Robredo campaigners know how to efficiently use their time well — by targeting voters who are seeking more information about Leni and may have not yet decided,” Ms. Reyes said.

Jean Encinas-Franco, a political science professor at the University of the Philippines (UP), said the Robredo campaign is a “master class” in civic education.

“The tao-sa-tao campaign is important because it gives voters the validation they need in these uncertain times,” she said in a Messenger chat. “They feel heard and seen.”

On Tuesday night, the Philippine-based religious group Iglesia ni Cristo, whose members have been known to vote as a bloc, endorsed the tandem of Mr. Marcos and his vice-presidential running mate, Davao City Mayor and presidential daughter Sara Duterte-Carpio.

On the other hand, about 1,400 Catholic bishops, priests and deacons announced their support for Ms. Robredo the day after. The church played a key role in two popular street uprisings that toppled two presidents.

In the Philippines, the president and vice-president are elected separately and may come from different parties.

“It’s useless at this point to expect the other nonadministration candidates to change their minds,” Maria Ela L. Atienza, who also teaches political science at UP, said in a Messenger chat. “But the election is already a two-way race between Robredo and Marcos.”

‘NEW SOCIETY’
The volunteer-driven campaign that has fueled Ms. Robredo’s campaign is a promising and effective way to bypass and challenge the traditional patronage-driven practices of powerful political families, said Temario C. Rivera, who heads the Center for People Empowerment in Governance.

“Nontraditional and progressive politicians will be more receptive to this campaign style since it also frees or weakens their dependence on these same patronage ties.”

The top two presidential bets capped their campaigns in Metro Manila at the weekend, with Ms. Robredo drawing a million people at a rally in the financial district of Makati City, according to estimates by her office.

Mr. Marcos held a rally in Parañaque City, where his more than a million supporters — according to his office — sang the modern version of a propaganda jingle used to trumpet his late father’s vision of a new society.

“There’s a new birth, a new life, a new path in the new society,” his supporters sang in Filipino.

Meanwhile, Ms. Robredo thanked her celebrity endorsers, who she said endured the heat and exhaustion during their house-to-house campaign.

“They bet their career and name,” she told the crowd in Filipino. “Despite the exhaustion, you still walked to find the next door. Let’s celebrate this historic campaign this evening. Let’s win this.”

Mr. Quising thinks knocking on doors helped him reach people’s hearts. “The internet as a medium has dehumanized most of our conversations, that’s why it’s important to reach out to ordinary people on the ground.”

LRT-1 operator seeks arbitration versus gov’t

PHILIPPINE STAR/EDD GUMBAN

Delayed fare adjustments prompt international court request

THE government has maintained its silence over the filing by the privately owned operator of Light Rail Transit Line 1 (LRT-1) of a request for arbitration with the International Chamber of Commerce for the company’s disputes with the Transportation department and its attached agency.

Light Rail Manila Corp. (LRMC) hopes to recover around P2.67 billion in compensation claims and costs resulting from delays in the implementation of fare adjustments for 2016, 2018, and 2020, Metro Pacific Investments Corp. (MPIC) said in a disclosure to the stock exchange on May 6.

The company filed the request for arbitration against the Department of Transportation (DoTr) and the Light Rail Transit Authority (LRTA), the grantors under the 32-year concession agreement (CA) for the LRT-1.

Sought for comment, a representative of the LRTA said: “LRTA cannot yet issue a statement on the matter, as it still has not received a copy of the request for arbitration; and after which, LRTA shall confer with DoTr and the Office of the Government Corporate Counsel.”

LRMC is composed of MPIC that leads the consortium with a 55% stake, Ayala group’s AC Infrastructure Holdings Corp. with a 35% stake, and Macquarie Infrastructure Holdings (Philippines), Inc. with a 10% stake.

“The request pertains to the adjustment of the approved fare for the years 2016, 2018 and 2020 and LRMC’s claims for compensation relating to the grantors’ contractual obligations to compensate LRMC for the difference between the stipulated fare and the approved fare based on the schedule provided in the CA, following the grantors’ inaction on LRMC’s application for fare adjustments based on the CA,” MPIC said.

The request also covers “the losses, costs and expenses incurred by LRMC for the grantors’ failure to deliver to LRMC the required number of light rail vehicles that meet the stipulated technical requirements under the CA and the structural defects on the existing LRT 1 system, both of which are required to ensure that LRMC is able to provide a safe, efficient and reliable service to the public as required under the CA.”

The company also said that “despite compliance with applicable legal requirements and after exerting best efforts to amicably discuss the foregoing claims with the grantors, LRMC has not received any offer from the DoTr and LRTA.”

The settlement of such claims is “critical” to enable LRMC to continue to be “viable and provide safe, efficient and reliable services to the public,” MPIC noted.

“Notwithstanding the dispute, LRMC remains committed in providing the best possible services to the public. In fact, despite the non-performance by the grantors of their obligations and the non-payment of LRMC’s claims, LRMC has implemented significant operational improvements, rehabilitation projects, and system upgrades to the existing system and continued the construction of the Cavite Extension safely and efficiently,” it added.

MPIC’s partner in LRMC, Ayala Corp., has expressed its intention to divest. MPIC said that it is considering to increase its stake, but that its decision would depend on the next government’s plans for LRT-1.

MPIC is one of three Philippine subsidiaries of Hong Kong’s First Pacific Co. Ltd., the others being PLDT Inc. and Philex Mining Corp.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., maintains an interest in BusinessWorld through the Philippine Star Group, which it controls. — Arjay L. Balinbin

Stronger peso seen as market expects Q1 economic growth

BW FILE PHOTO

THE peso may strengthen versus the greenback this week as analysts await the release of first-quarter economic growth data, although this could be offset by risk-off sentiment ahead of official election results.

The local unit closed at P52.50 per dollar on Friday, weaker by 11.5 centavos from its P52.385 finish on Thursday, based on Bankers Association of the Philippines data.

It also shed 31 centavos from its P52.19 close a week earlier.

The peso opened Friday’s session at P52.48. Its weakest showing was at its close of P52.50, while its intraday best was at P52.44.

Dollars exchanged declined to $878.5 million on Friday from $907.5 million on Thursday.

The peso weakened due to wider trade deficit data, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Data released by the Philippine statistics authority showed the trade deficit nearly doubled to $5 billion in March from $2.759-billion gap a year earlier. This was driven by the 27% growth in imports to $12.175 billion, while exports also rose by 4.9% to $7.171 billion.

The trade deficit for the first three months of the year reached $13.892 billion, bigger than the $8.345-billion gap in the same period of 2021.

Mr. Ricafort said there was also risk-off sentiment in the market on Friday as it was the last trading day before the national elections on Monday, May 9.

Meanwhile, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said the faster-than-expected inflation rate also caused the peso to weaken last week.

Headline inflation accelerated to a three-year high of 4.9% in April, driven by soaring food and energy prices. This is already beyond the 2-4% target set by the Bangko Sentral ng Pilipinas and also quicker than the 4.6% median estimate of 17 analysts in a BusinessWorld poll.

Mr. Asuncion said the market will be on the lookout for first-quarter economic growth data this week, as this could strengthen the case for a rate hike from the Bangko Sentral ng Pilipinas (BSP). The Philippine Statistics Authority will report the preliminary gross domestic product data (GDP) for the January-to-March period on May 12, Thursday.

A BusinessWorld poll of 17 analysts yielded a median estimate of 6.7% in the first quarter. If realized, this would mark the fourth straight quarter of annual economic expansion but is slower than the 7.8% growth in the fourth quarter of 2021.

Economists said the Omicron surge in January, as well as the impact on spending of rising commodity prices caused by the war in Ukraine, likely slowed economic growth in the first quarter.

BSP Governor Benjamin E. Diokno has said policy makers might consider a rate hike at their June 23 meeting, taking into account whether economic growth is more entrenched as reflected by GDP and unemployment data.

Meanwhile, Mr. Ricafort said the market would be on the lookout for the results of the national elections.

Former Senator Ferdinand R. Marcos Jr., the son of the late dictator, is still the frontrunner for the presidency based on the latest round of surveys. However, Vice-President Maria Leonor G. Robredo, the second leading candidate for the top post, is seen to be more favored by the market, based on a Bloomberg poll of analysts.

The market is closed this Monday in view of the special non-working holiday declared for the national elections.

For this week, Mr. Ricafort gave a forecast range of P52.30 to P52.60 per dollar, while Mr. Asuncion expects a stronger P52 to P52.50 band. — Luz Wendy T. Noble

Gucci jumps on the crypto bandwagon with US project

DIMA PECHURIN/UNSPLASH

GUCCI’s high-end handbags and other luxury products can now be bought using cryptocurrencies, including bitcoin, in some US stores, the Italian company said, as digital currencies move to broader acceptance.

Starting later this month, customers can pay with crypto at some of Gucci’s flagship stores, including Rodeo Drive in Los Angeles and Wooster Street in New York, the company said.

Gucci, owned by France’s Kering, plans to expand the service to its directly operated North America stores in the near future.

A growing number of companies have started to accept virtual currencies, bringing an asset class shunned by major financial institutions until a few years ago closer to the mainstream.

Fashion label Off-White, in which French luxury group LVMH took a majority stake last year, has started accepting crypto in its London, Paris, and Milan flagship stores, Vogue Business reported in March.

Gucci said on Wednesday it would accept multiple digital assets, including ethereum, dogecoin, shiba inu, litecoin, and a few US dollar-pegged stablecoins. —  Reuters

SEC warns anew about Leefire, now named Sengre

THE Securities and Exchange Commission (SEC) warned the public against the illegal investment solicitation activities of Leefire Philippines, which has been continuing operations under another name, Sengre.

“The records of the commission show that Sengre is not registered with the commission either as a corporation or as a partnership. Further, it is not authorized to solicit investments from the public since it has not secured prior registration and/or license,” the SEC said in an advisory.

In April, the SEC issued a separate advisory against Leefire Philippines for enticing the public to invest in the company without license or registration.

The commission also reported that Leefire Philippines was not registered as a corporation or partnership and was not authorized to solicit investments, since it did not secure prior registration or license.

Under its new name, Sengre, the unauthorized firm is promising its investors to receive its native cryptocurrency Sengre Coin in an apparent initial coin offering (ICO).

An ICO is the first sale and issuance of a new virtual currency to the public usually for the purpose of raising capital for startup companies or funding independent projects, according to the SEC.

Sengre was found to be offering investments to the public through a website. Signing up entitles investors to get a cash bonus of P150 which can be used to buy corresponding levels of goods.

By accomplishing a higher-level of task, users may earn more commission and rewards. It also rewards users for inviting acquaintances to join.

The SEC said that the described schemes require that the securities be duly registered and that the corporation and its agents have the appropriate registration and license.

The commission found that Sengre is also not registered as a virtual asset service provider with the Bangko Sentral ng Pilipinas and does not have a corresponding certificate of authority as a money service business (MSB).

“Further, Sengre’s name does not appear among those listed as registered MSBs as of January 2021 with the Anti-Money Laundering Council under the Anti-Money Laundering Act, as amended,” it added.

The SEC said that salesmen, brokers, dealers or agents involved in selling or convincing people to invest in Sengre may be prosecuted and held criminally liable.

Penalties include a maximum fine of P5 million or imprisonment of up to 21 years.

“The public is advised not to invest or stop investing in any investment scheme being offered by any individual or group of persons allegedly for or on behalf of Sengre and to exercise caution in dealing with any individuals or group of persons soliciting investments for and on behalf of it,” the regulator added. — Luisa Maria Jacinta C. Jocson