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NGCP working to reconnect transmission lines affected by Typhoon Odette

THE National Grid Corp. of the Philippines (NGCP) said permanently reconnecting Bohol to Leyte transmission lines affected by Typhoon Odette last month is still their biggest challenge and is targeted to be done by April 30. 

“There is much to be done in reconnecting the Tagay-Ubay 138-kilovolt (kV) line to fix transmission in Bohol to Leyte lines,” Randy A. Galang, NGCP Head of Visayas Systems Planning, said at a press conference on Friday. 

The grid operator has restored 87 or 92% of its 95 transmission lines that were affected by Typhoon Odette last month. 

The official said they will use a 500-kV design, which is sturdier compared to the toppled 138-KV towers. 

The toppled towers are in Mainland Bohol and Lapinig island in Leyte, crossing the Basiao Channel. 

The new towers will also be able to withstand 300-kilometer-per-hour (kph) wind velocity, higher than the previous 240-kph capacity. 

They will be made from lighter materials, specifically a 27.73-millimeter (mm) conductor versus 29 mm previously, as this would prevent the lines from sagging, allowing the new tower to be built shorter at 120 meters from 150 meters. 

“Aside from working on this permanent solution, we are also looking into a temporary solution by using an emergency restoration system (ERS), which we are currently studying,” Mr. Galang said, adding they are working on finalizing this as soon as possible. 

“The challenge there is on how we can bring the ERS to the restoration sites as most are located on top of the mountains,” he said. — MCL 

From trash to cash: waste pickers help stem the plastic pollution tide, earn thousands

The world’s ability to produce waste outpaces its ability to manage it. In Cavite, informal waste pickers are helping stem the plastic pollution tide by turning trash into useful products with the assistance of Project ASEANO.

ASEANO is a project under Partnerships in Environmental Management for the Seas of East Asia (PEMSEA), a regional organization that advocates integrated solutions for coastal and marine problems. It promotes sustainable measures to reduce the environmental impact of plastic pollution. Cavite’s Imus River is the main area of focus of its Philippine sub-component.

A GREENER OPTION

Metals, plastics, and other useful trash are sold by waste pickers to junkshops, which then sell them to recycling facilities that have the capacity to convert the trash into raw materials, explained Gregg H. Yan, a PEMSEA consultant, in an e-mail.

“The energy needed to create new metal alloys via mining greatly exceeds the effort needed to just melt copper, steel, or iron,” he told BusinessWorld. “Recycling is a green and more economical option.”

In a press statement, Thomas Bell, PEMSEA’s resource facility program manager, added that supporting waste pickers and recycling facilities helps convert a significant portion of waste – which would otherwise be dumped in landfills or rivers – into useful products.

“These cottage industries also support the lives and livelihoods of thousands of Filipinos,” he said.

In 2018, Cavite generated an average of 1,514 tons of waste daily – 22% of which was still recyclable, according to the Environmental Management Bureau (EWB). The average volume of wastes generated within the Calabarzon region, where Cavite is located, is about 5,694 tons a day.

The Imus River flows through the waste-generating cities of Bacoor, Dasmariñas, and Imus, before flowing out to Manila Bay.

Plastic’s largest market is packaging, noted Science Advances in a July 2017 journal, and this market growth has only increased since the world shifted from reusable to single-use containers.

FROM TRASH TO CASH

In the Philippines, the informal waste sector consists of waste pickers in dumpsites and communal waste collection points. Among these are women, children, and the elderly who depend on informal waste collection due to poverty and a lack of education.

“The most sought-after types of plastics [by waste pickers] are PET bottles and hard plastics called sibak. These are what plastic monobloc chairs, jerry cans, and many toys are made of,” Mr. Yan said. “The plastics they don’t collect are disposable sando and trash bags, plus the plastic and foil packaging of sachets. This is a primary reason why these types of single-use plastics are causing enormous environmental challenges.”

One such waste picker is Sherwin Salazar, who has been hunting for scrap for 25 years in Cavite.

“I was still in school when I started pawing through old lots, dumps, and river banks in a never-ending search for bakal, bote, plastik at dyaryo (scrap metal, bottles, plastic, and newspapers). I used a big old sack that weighed so much,” he said in a PEMSEA press release. From earning P100 a day as a 12-year-old, he now earns P1,000-P1,500, thanks in part to a motorized tricycle that allows him to travel to nearby cities like Tagaytay.

Mr. Yan said that – like all business ventures – it takes time, trustworthy contacts, and capital to get to the P1,000-P1,500 a day level.

“Expanding one’s territory and creating networks is an important consideration for waste pickers to ‘lay claim’ to a large enough area to net good finds on a regular basis. Moving up the chain might also mean hiring junior waste pickers and investing in better collection equipment, like a kariton [a pushcart] or a pedicab [a tricycle with a two-seat passenger compartment],” he told BusinessWorld.

Mr. Salazar added that the life of a waste picker is dirty, but “if you meet life’s challenges head-on and ask for a little help from above, then it’s really rewarding.”

The results of Project ASEANO, which ends this year, will be synthesized into an LGU (local government unit) training manual, toolkit, and best practices handbook. The aim is for the materials to be a reference for the Philippines and the rest of the ASEAN region.

In May 2009, the National Solid Waste Management Commission prepared a National Framework Plan for the Informal Sector in Solid Waste Management. While this national plan recognizes the informal waste sector’s contribution to waste collection and disposal, a 2008-2018 report by the EWB noted that LGUs have yet to develop and implement their respective plans for this sector. — Patricia Mirasol

BSP fully awards offer of short-term bills

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THE CENTRAL BANK fully awarded the short-term securities it auctioned off on Friday as the tenor’s average yield eased on increased demand. 

The Bangko Sentral ng Pilipinas (BSP) raised P100 billion as planned from its offer of 28-day bills that attracted P211.39 billion in tenders, more than double the P104.56 billion in bids seen on Dec. 17. 

Accepted rates for the one-month debt papers ranged from 1.72%-1.78%, lower than the 1.785%-1.98% band seen the previous week. 

This brought the average rate of the one-month securities to 1.7666%, down by 8.68 basis points from the 1.8534% fetched during the previous offering. 

The central bank uses its short-term securities and term deposit facility to mop up excess liquidity in the financial system and guide market rates. 

Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said the average yield on the BSP bills eased on higher demand. 

He also attributed the lower yield to slower inflation and the continued rejection of bids for Treasury bonds (T-bond). 

“BSP 28-day auction yield also lower amid recent concerns over the resurgence of COVID cases locally and worldwide amid lingering concerns over the Omicron variant and the increase in COVID cases,” he said in a Viber message. 

Inflation eased to 3.6% in December, the lowest in 12 months, amid a slower increase in food and transport prices. 

Still, the full-year inflation average of 4.5% exceeded the central bank’s 2-4% target. 

Meanwhile, the Treasury rejected all bids for its offer of reissued seven-year T-bonds on Tuesday as bids exceeded market expectations even as inflation eased. 

The government also rejected all bids for its two T-bond offerings in December. 

National Treasurer Rosalia V. de Leon said the government’s cash position can comfortably meet funding requirements despite these rejections. — J.P. Ibañez 

Central bank books higher net profit in first 11 months of 2021

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THE BANGKO SENTRAL ng Pilipinas (BSP) posted higher earnings in the first 11 months of 2021 as its interest income increased. 

Data released on its website showed the central bank recorded a net income of P67.08 billion in the first 11 months of 2021, almost double the P34.51 billion recorded in the same period in 2020. 

Revenues rose by 42.1% year on year to P154.14 billion in the period from P108.5 billion a year earlier. 

Broken down, the central bank’s interest income stood at P104.05 billion, up by 33.6% from the P77.86 billion in the same period last year. 

Miscellaneous income — which includes trading gains, fees, and penalties — grew 63.5% to P50.09 billion from P30.64 billion. 

Meanwhile, BSP’s expenses grew by 43.4% to P97.74 billion as of November from P68.14 billion a year earlier. Interest expenses also rose to P55.54 billion from P42.04 billion. 

The BSP reported P10.71 billion in net gains on foreign exchange rate fluctuations in the 11-month period, reversing the P5.67-billion net loss logged a year prior. 

The central bank’s total assets reached P7.989 trillion as of November 2021 from P7.34 trillion the previous year. 

Meanwhile, liabilities rose by 9.5% year on year to P7.858 trillion from P7.173 trillion. 

The BSP posted a net worth of P130.7 billion as of November 2021, 11.8% higher than the P116.93 billion seen a year earlier. — Jenina P. Ibañez 

Banks leave rediscount facility untouched in December

LENDERS did not tap the central bank’s rediscount facility in December as loan growth remained relatively slow. 

“For the period 01 January to 31 December 2021, total availments of banks against their rediscount loans remain unchanged at P6.12 million for loans under the peso rediscount facility,” the Bangko Sentral ng Pilipinas (BSP) said in a statement on Friday. 

Banks also left the Exporters’ Dollar and Yen Rediscount Facility (EDYRF) untouched. 

The BSP’s rediscount window gives banks access to additional money supply by posting their collectibles from clients as collateral. 

Banks may then use the cash — in peso, dollar or yen denominations — to grant loans to corporate or retail clients and service unexpected withdrawals. 

In 2021, banks only tapped the central bank’s rediscount facility in June, July, and September. 

Bank lending has been relatively slow in recent months, which reduced the need to tap the BSP’s rediscount window, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message. 

“Banks also have other options for funding such as the interbank market and the capital markets, in view of the increase in fund-raising/investment banking activities in recent months, thereby also reducing the need for banks to tap the BSP rediscounting facility,” he said. 

Outstanding loans issued by big banks went up 4% year on year to P9.349 trillion in November 2021, quicker than the 3.5% expansion in October 2021 and marking the fourth straight month of annual growth in lending.  

Meanwhile, for January, the central bank said peso rediscount loans are priced at 2.5%, regardless of maturity. 

On the other hand, the rates for dollar and yen rediscount loans, regardless of maturity, are 2.20913% and 1.924%, respectively. – Jenina P. Ibañez 

Peso declines vs dollar as COVID-19 cases continue to climb

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THE PESO weakened against the dollar on Friday as coronavirus disease 2019 (COVID-19) cases continued to surge. 

The local unit closed at P51.35 per dollar on Friday, sinking by 17 centavos against its P51.18 finish on Thursday, data from the Bankers Association of the Philippines showed. 

The peso opened at P51.25 versus the dollar. Its intraday high was at P51.18, while its worst showing was at P51.37 against the greenback. 

Dollars traded fell to $1.017 billion on Friday from $1.151 billion the previous day. 

A trader in an email said the peso weakened as local participants remained cautious over increasing COVID-19 cases in the country. 

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort also said in a Viber message that the peso declined in response to the rapid increase in new COVID-19 cases, which prompted the government to announce stricter mobility restrictions. 

“Peso (was) also weaker after local monetary authorities signaled smooth transition on unwinding extraordinary easy monetary measures,” he said in a Viber message. 

The daily COVID-19 tally went up to 21,819 cases on Friday, data from the Health department showed, for bringing active infections to 77,369. 

The government placed Metro Manila and nearby provinces under Alert Level 3, a stricter form of lockdown. 

Meanwhile, the Bangko Sentral ng Pilipinas (BSP) said the date of its exit from easy policy is still uncertain, with BSP Governor Benjamin E. Diokno noting the transition will be done smoothly. — JPI 

Stocks sink on rising cases, losses from tighter restrictions

Philippine Stock Exchange index

STOCKS declined further on Friday due to the continued surge in infections after economic managers said the country will lose about P3 billion a week due to stricter mobility restrictions. 

The bellwether Philippine Stocks Exchange index (PSEi) dropped 74.41 points or 1.05% to 7,011.11 on Friday, while the broader all shares index fell 31.97 points or 0.84% to 3,745.61. 

“Market is pricing the estimated cost of P3 billion in weekly losses in terms of gross value added,” First Metro Investment Corp. Head of Research Cristina S. Ulang said in a Viber message. 

“Sentiment was dented by the surge in infections with the placing of more areas in the country under Alert Level 3 status,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message. 

Economic managers said in a statement on Friday that the country is projected to lose P3 billion a week due to the imposition of Alert Level 3 in Metro Manila and nearby areas. 

President Rodrigo R. Duterte on Thursday night placed five provinces and nine cities under Alert Level 3 starting Jan. 9 in addition to Metro Manila, Rizal, Bulacan, Laguna, and Cavite as part of efforts to curb the rapid spread of coronavirus disease 2019 (COVID-19). 

The Health department reported 21,819 new COVID-19 cases on Friday. 

Mr. Tantiangco added that Friday trading was lethargic, with the value turnover below last year’s daily average of P7.38 billion. 

Value turnover inched up to P5.85 billion with 647.43 million issued traded on Friday, from the P5.21 billion with 771.81 million shares that switched hands the previous day. 

All sectoral indices closed lower on Friday. Property decreased 54.84 points or 1.75% to 3,068.75; mining and oil plunged 164.88 points or 1.7% to 9,524.90; industrials went down by 108.86 points or 1.06% to 10,110.81; holding firms fell 65.21 points or 0.94% to 6,845.80; services lost 14.02 points or 0.71% to 1,941.77; and financials slipped 6.46 points or 0.40% to 1,582.14. 

Decliners outnumbered advancers, 136 versus 51, while 46 names closed unchanged. 

Net foreign selling increased to P284.75 million on Friday from the P103.55 million recorded on Thursday. — MCL 

Sounding alarm on China, Japan and U.S. vow to collaborate more on defence

OKYO/WASHINGTON – The United States and Japan on Friday voiced strong concern about China’s growing might and pledged to work together to push back against attempts to destabilise the region, including against emerging defence threats.

The comments from the two allies, in a joint statement that followed a virtual “two-plus-two” meeting of their foreign and defence ministers, highlights how deepening alarm about China – and increasing tension over Taiwan – have put Japan‘s security role in greater focus.

In their meeting, the ministers expressed concerns that China’s efforts “to undermine the rules-based order” presented “political, economic, military and technological challenges to the region and the world,” the joint statement said.

“They resolved to work together to deter and, if necessary, respond to destabilising activities in the region,” it said.

The ministers also said they had “serious and ongoing concerns” about human rights issues in China’s Xinjiang and Hong Kong regions and underscored the importance of peace and stability in the Taiwan Strait.

While pacifist Japan retains close economic ties to China, there is growing concern in Tokyo about a potential move by Beijing against democratic Taiwan.

“This is clearly a combined message reflecting a common concern, not a case of U.S. arm-twisting to get Japan to sign onto vague euphemisms,” said Daniel Russel, who served as the top U.S. diplomat for Asia under Obama and is now with the Asia Society Policy Institute.

“In particular, the expression of joint resolve to respond if necessary to destabilising activities comes across as a powerful expression of alliance solidarity and determination.”

Earlier, U.S. Secretary of State Antony Blinken said the two countries would sign a new defence collaboration deal to counter emerging threats, including hypersonics and space-based capabilities.

 

NEW TOOLS

Blinken said the U.S.- Japan alliance “must not only strengthen the tools we have, but also develop new ones”, citing Russia’s military buildup against Ukraine, Beijing’s “provocative” actions over Taiwan and North Korea’s latest missile launch. North Korea fired a “hypersonic missile” this week that successfully hit a target, its state news agency said.

Following the meeting, Japan‘s foreign minister, Yoshimasa Hayashi, said Tokyo had explained its plan to revise the national security strategy to fundamentally boost defence capabilities, which he said was strongly supported by his U.S. counterparts.

Prime Minister Fumio Kishida in October promised to revise Japan‘s security strategy to consider “all options including possession of the so-called enemy-strike capabilities”.

Kishida’s government has approved record defence spending, with a 10th straight annual increase in 2022.

Jeffrey Hornung, a Japanese security policy expert at the Rand Corporation, a U.S.-backed think tank, said while options for Japan to use force are realistically limited, a Taiwan emergency would be one potential scenario that Japan could deem as threatening its survival.

“There is no coded messaging here,” Hornung said.

“China is the challenge and they said as much, then detailed all the ways the alliance is determined to work to counter its destabilising activities.” – Reuters

National Artist for Literature F. Sionil Jose, 97

Francisco Sionil Jose

F. Sionil Jose, the multi-awarded fictionist and essayist whose works tackled themes of social injustice, class struggle, and colonialism in the Philippines, died in his sleep on Jan. 6. He was 97. His family, through his Facebook profile, confirmed his death late that night: “Our father passed away peacefully this evening. Many years ago, he told us this is what he wants written about him: ‘He wrote stories and he believed in them.’”

Francisco Sionil Jose was born on Dec. 3, 1924, in Rosales, Pangasinan. Many of his short stories and novels were set in his hometown, the best known of which were the Rosales Novels, a five-part saga that followed generations of the Samson family, whose personal lives are tied seamlessly with three centuries of Philippine history. The series’ final novel, Mass, published in 1973, earned him one of his five Palanca awards.

Jose’s writings have been translated to over 25 languages and published in various international journals and anthologies over the years. In 1965, he opened the Solidaridad Bookshop in Ermita, Manila, which became a hub for local writers and those seeking Filipiniana reading material. It also served as the headquarters for the Philippine Center of International Poets, Essayists, Novelists (PEN) International, which he founded in 1957. The shop is still in business in its original location.

Jose was bestowed the Ramon Magsaysay Award for Journalism, Literature, and Creative Communication Arts in 1980, the Outstanding Fulbrighters Award for Literature in 1988, and the CCP Centennial Honors for the Arts in 1999. He was given the Order of National Artist in 2001 for his contributions to literature.

To many, he was known as Manong Frankie, always the writer with a quick wit and divisive opinions but never without his signature beret and cane — both of which may seemed like fashion statements but were actually meant to keep him warm and safe, he once admitted in his column in The Philippine Star.

The most recent of his most forthright comments was his criticism of journalist Maria Ressa receiving the 2021 Nobel Peace Prize, posting on Facebook that he had not “read anything memorable by her.”

But despite this sharp tongue that earned him both fans and detractors, he also wrote with chilling honesty about his own self, the final example of which would be a message he posted addressing his heart, a few hours before his death.

“Thank you brave heart. There are times when as an agnostic I doubt the presence of an almighty and loving God. But dear brave heart you are here to disprove this illusion, to do away with the conclusion that if you doubt Him, you kill Him. I cannot kill you dear heart; you have to do that yourself. For 97 years you have been constantly working patiently pumping much more efficiently and longer than most machines. Of course, I know that a book lasts long too, as the libraries have shown, books that have lived more than 300 years. Now, that I am here waiting for an angioplasty, I hope that you will survive it and I with it, so that I will be able to continue what I have been doing with so much energy that only you have been able to give. Thank you dear brave heart and dear Lord for this most precious gift,” he wrote.

Jose was scheduled for angioplasty surgery at the Makati Medical Center, but passed away the night before. His heart was unable to continue, allowing the Philippine literary icon to rest. — Brontë H. Lacsamana

E3 video game expo to not be held in person amid COVID-19 risks

The Electronic Entertainment Expo (E3), a globally renowned event for video games, technology, and computers, will not be held in person this year amid fears around COVID19, its operator said on Thursday.

The development adds to a list of many showpiece events being wrapped up early or getting canceled or postponed for in-person gatherings amid a surge in U.S. cases, with the latest ones being technology and gadget show CES, the Grammy Awards, and the Sundance Film Festival. .

“Due to the ongoing health risks surrounding COVID19 and its potential impact on the safety of exhibitors and attendees, E3 will not be held in person in 2022,” the E3 operator Entertainment Software Association (ESA) said in a statement.

The rolling seven-day average of new COVID19 cases in the U.S. hit 540,000 earlier this week along with a surge in hospitalizations, days after the country reported a record one million infections in 24 hours. – Reuters

A year after U.S. Capitol siege, Biden blasts Trump’s ‘web of lies’

REUTERS

WASHINGTON – President Joe Biden on Thursday accused his predecessor Donald Trump of spreading a “web of lies” to undermine U.S. democracy in a speech on the anniversary of the deadly Capitol attack by Trump supporters who tried to undo his 2020 election defeat.

Speaking at the white-domed building where rioters smashed windows, assaulted police and sent lawmakers fleeing for their lives on Jan. 6, 2021, Biden said Trump’s false claims that the election was stolen from him through widespread voting fraud could unravel the rule of law and subvert future elections.

“A former president of the United States of America has created and spread a web of lies about the 2020 election. He’s done so because he values power over principle,” Biden said. “He can’t accept he lost.”

Biden never actually uttered his predecessor’s name during the 25-minute speech, telling reporters afterward he was trying to focus on the threats to America’s political system instead of Trump himself.

The tone, including a poke at Trump’s “bruised ego,” was a departure for Biden, who has focused during most of his first year in office on pursuing his own agenda. Trump issued three statements in the hours following his successor’s remarks accusing Biden of trying to divide the country and repeating his false election claims.

Trump’s behavior over the past year, like his conduct in office, has been norm-shattering. Unlike other former U.S. presidents denied re-election, Trump has refused to accept the verdict of the voters and pressured fellow Republicans to somehow overturn the results, without success.

His false claims have provided cover for Republicans at the state level to pass new restrictions on voting that they have said are needed to fight fraud. Research shows such fraud is extremely rare in U.S. elections.

Biden‘s fellow Democrats, a few Republicans and many independent experts have said Trump’s continued denials could make it less likely that future U.S. transfers of power will be peaceful – especially those involving closer margins than the 2020 election that Biden won by 7 million votes nationwide.

The speech illustrated that Biden and other Democrats remain wary of Trump’s political staying power. In the riot’s immediate aftermath, even some Republicans thought his grip on their party had been shaken, but since then Trump has only tightened it.

“Our democracy is very fragile, and the cult of The Big Lie is still very much in action with the help of the vast majority of our colleagues on the other side, who continue to try to rewrite or ignore history,” Democratic Representative Pramila Jayapal said at an afternoon event.

House Speaker Nancy Pelosi led dozens of bundled-up Democratic lawmakers holding lights in a moment of silence on the steps of the Capitol, part of a candlelight prayer vigil that was the final official event of the anniversary.

Not far away, a vigil at the D.C. jail for the about 40 inmates charged in connection with the Jan. 6 assault was sparsely attended.

“This is not speedy justice,” said L.A. Warren, 65, who had driven to Washington from his Michigan home for the day and said he, too, had participated in the storming of the Capitol. “A year, that’s a long time, when these people – a lot of them, in my view – was trespassing.”

 

‘CULT OF PERSONALITY’

Just two Republicans were spotted at a House of Representatives session marking the riot’s anniversary: Representative Liz Cheney, who has been shunned by party colleagues after criticizing Trump, and her father Dick Cheney, who served as vice president under President George W. Bush.

“A party that is in thrall to a cult of personality is a party that is dangerous to the country,” Liz Cheney told reporters on her way out of the Capitol.

Dick Cheney told reporters that current party leaders do not resemble “any of the folks I knew” when he served in Congress.

America’s next federal election is in November, with Republicans favored to retake a majority in at least one of the two chambers of Congress. That could cripple Biden‘s ability to advance policy and set the stage for two years of legislative gridlock before a potential 2024 Biden-Trump rematch.

According to Reuters/Ipsos polling, 55% of Republican voters believe Trump’s false claims, which were rejected by dozens of courts, state election departments and members of his own administration.

Four people died in the hours-long chaos after Trump urged supporters to march to the Capitol and “fight like hell.” One police officer died on that day after battling rioters and four later died by suicide. Around 140 police officers were injured. U.S. prosecutors have brought criminal charges against at least 725 people linked to the riot.

Trump remains highly popular among Republican voters and is working to shape the field of Republican candidates in the Nov. 8 congressional elections.

Most Republican officeholders have remained loyal to him, and some have sought to play down the riot. Liz Cheney is one of only two Republican members of a House committee investigating the riot, which in recent weeks has unearthed records showing Trump allies urging him to call off the rioters as the attack was unfolding.

Other Republicans accused Democrats of exploiting the anniversary for partisan gain.

“What brazen politicization of Jan. 6 by President Biden,” said Senator Lindsey Graham, who has reversed his position on Trump numerous times, including criticizing him after the riot and then reverting to defending him. – Reuters

Qatar Airways seeks more than $600 mln in Airbus A350 dispute

PARIS/LONDON – Qatar Airways is seeking more than $600 million in compensation from Airbus over surface flaws on A350 jetliners, according to a court document shedding new light on an escalating business feud worth $4 million a day.

The Gulf carrier is also asking British judges to order France-based Airbus not to attempt to deliver any more of the jets until what it describes as a design defect has been fixed.

The two companies have been locked in a row for months over damage including blistered paint, cracked window frames or riveted areas and erosion of a layer of lightning protection.

Qatar Airways says its national regulator has ordered it to stop flying 21 out of its 53 A350 jets as problems appeared, prompting a bitter dispute with Airbus which has said that while it acknowledges technical problems, there is no safety issue.

Now, financial and technical details associated with the rare legal spat have emerged in a court filing at a High Court division in London, where Qatar Airways sued Airbus in December.

The Gulf airline is calling for $618 million in contractual compensation from Airbus over the partial grounding, plus $4 million for each day the 21 jets remain out of service.

The claim includes $76 million for one aircraft alone – a five-year-old A350 that was due to be re-painted in livery for the 2022 World Cup, which Qatar is hosting later this year.

That aircraft has been parked in France for a year needing 980 repair patches after the aborted paint job exposed gaps in the lightning shield, industry sources say.

The largest customer for Europe’s premier long-haul jet claims Airbus failed to provide a valid root-cause analysis.

The jets feature a layer of copper mesh under the paint to prevent lightning – which strikes planes on average once a year – from damaging the carbon-composite fuselage, which is lighter but less conductive than traditional metal.

 

BREAKDOWN OF RELATIONS

Airbus said it understood the cause and would “deny in total” the airline’s complaint. It has accused the airline, once one of its most highly courted customers, of trying to mischaracterize the problems as a safety concern.

Airbus restates there is no airworthiness issue,” a spokesperson said, adding this had been confirmed by European regulators.

Shares in the European planemaker closed down 1.5%.

Qatar Airways, which originally ordered a total of 80 A350s, had no immediate comment.

The airline has long had a reputation as a demanding buyer, sporadically rejecting deliveries for quality reasons.

But the 30-page complaint details an unusual collapse of relations between two of aviation’s most powerful players.

The dispute widened in November when a Reuters investigation https://www.reuters.com/business/aerospace-defense/costly-airbus-paint-flaw-goes-wider-than-gulf-2021-11-29 revealed at least five other airlines had discovered surface flaws, prompting Airbus to set up an internal task force and to explore a new anti-lightning design for future A350 planes.

Qatar is so far the only country to ground some of the jets.

Under aviation rules, the manufacturer’s primary regulator – in this case the European Union Aviation Safety Agency (EASA) – oversees an aircraft’s design. Regulators in nations across the world monitor local airlines and their individual aircraft.

The complaint detailed how the Qatar Civil Aviation Authority (QCAA) had withdrawn airworthiness approval for individual A350 planes in a series of letters from June 2021.

It said the QCAA had told the airline that the deterioration of airplanes was “disturbing, if not alarming.” The regulator had also said it was “deeply concerned” that safety could be compromised because of a lack of analysis or permanent fix.

It is the first evidence of the stance of Qatar‘s regulator, which has not commented in public. Europe’s EASA, by contrast, has said it has not yet found evidence of airworthiness issues.

Airbus has appeared to question the QCAA’s independence from the state-owned airline, saying the decision to drag safety into a technical matter put at risk global safety protocols.

Qatar Airways Chief Executive Akbar Al Baker insisted in November that Qatar‘s regulator was driving safety decisions and that the row had caused a “serious dent” in operations.

The airline has started bringing mothballed A380s out of retirement as it prepares to cope with the soccer World Cup. – Reuters