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DPWH planning new Eastern Visayas road network 

DPWH

THE Department of Public Works and Highways (DPWH) said Wednesday that it is currently preparing plans with a two-to-five-year timeline for a new road network in the Eastern Visayas. 

The DPWH said it is preparing a roadmap for short- and long-term projects aimed at helping “spur the improvement of infrastructure services in Eastern Visayas and move the region into a virtuous circle of growth and development.” 

“Among the projects identified for the long-term program [are] the 15-kilometer (km) Samar Pacific Coastal Road Project (SPCR) Phase 2, including two long-span bridges with a total length of 1.4 km with already completed feasibility study and project proposal under preparation for submission to the National Economic and Development Authority,” the DPWH said in a statement. 

“The SPCR Project Phase 2 from Catarman-Laoang Road Junction to Laoang-Palapag Road Junction will lessen the travel time and establish a sustainable economic development foundation in Northern Samar,” it said. 

Another project is the construction of a 700-meter Liloan Bridge with the preparation of a project concept paper ongoing. 

A 1.1-km Maasin Coastal Bypass Bridge is also the subject of discussions with the Export-Import Bank of Korea. 

A 23-km Bohol-Leyte Link Bridge with a completed pre-feasibility study funded by Asian Development Bank will be “revisited,” the DPWH said. — Arjay L. Balinbin  

Congress ratifies bicameral report on amendments to Foreign Investments Act 

PHILSTAR

BOTH Houses of Congress have ratified the bicameral conference committee report harmonizing a measure amending the Foreign Investments Act of 1991, which would open up more industries to foreign direct investment. 

Senator Maria Imelda Josefa R. Marcos, the primary sponsor of the bill and chair of the Senate committee on Economic Affairs, said that the bicameral conference had used the Senate bill as the basis for the measure’s final version.  

The report reconciled the differences between Senate Bill 1156 and House Bill 300.

“I am grateful to the House panel for their generosity and openness in accepting our thoroughgoing changes and their significant introduction of many amendments improving the law that we see now,” she said at the plenary session late Tuesday.  

If approved, foreigners will be allowed to own 100% of more domestic market enterprises, with the exception of industries on the foreign investment negative list. 

The required number of local direct hires for foreign companies will be reduced to 15 from the current 50. 

The reconciled version also called for the establishment of an online portal for foreign investors.  

The language on labor requirements was rationalized for employment in firms with lower paid-up capital of $100,000. 

Ms. Marcos said that the language was strengthened to recognize the rights of employees and to institutionalize the requirement of understudy programs for alien employment permits. 

Under the harmonized bill, a national security review is now limited to foreign investment involving military-related industries, cyberinfrastructure, pipelines, or other activities which may threaten the territorial integrity and safety, security, and well-being of Filipino citizens.  

The measure will not cover financial institutions regulated by the Bangko Sentral ng Pilipinas and occupations under the jurisdiction of professional regulatory boards. 

The anti-graft provision on the list of penalties was simplified. Any public official or employee involved in foreign investment promotion who commits violations is liable for fines of between P2 million and P5 million. 

An Inter-Agency Investment Promotion Coordination Committee will also be created under the proposed law, which will be led by the Department of Trade and Industry. 

The measure will now be sent to the Palace for the signature of President Rodrigo R. Duterte. 

The Philippines was found to be the third most restrictive out of 83 economies on the Foreign Direct Investments Regulatory Restrictiveness Index compiled by the Organization for Economic Cooperation and Development in rankings released last year. — Alyssa Nicole O. Tan 

Let’s talk about cyber trust

The social limitations posed by the COVID-19 crisis have made technology all the more vital in our daily lives. People have become dependent on technology in procuring basic needs and services with physical safety as first priority.

As such, we have witnessed an exponential increase in the number of retailers selling their products and services online. Even with slow internet speeds, retailers can resort to various digital platforms, which inevitably become exposed to cyber attack.

Buying from online sites gives customers a sense that their physical security needs are being met during the pandemic. But difficulties such as internet speed, security and privacy go hand-in-hand with the ease of online shopping. As we rely more on our devices for online sales of goods and services, cyber criminals have been taking advantage of software design flaws and glitches in sellers’ platforms.

As we take a closer look at the vulnerabilities, we can come up with strategies that will offer protection for online consumers. Yet we often see eyes rolling whenever the topic of online security and privacy comes up.

Online consumers have now grown fearful of falling prey to cybercrime, making them harbor a distrust in the use of technology and its associated platforms. This has inevitably brought forth consumer reluctance as regards the safety of online transactions.

It is time to change this experience.

TYPES OF CYBERCRIME
The number of online scams and fraudulent internet transactions continues to rise. Phishing, the most common type of attack, involves stealing user data such as passwords and credit card information.

Hackers con people by posing as trusted organizations, sending e-mails or text messages to potential victims. When a victim is successfully tricked into clicking a link in the message, the malware is installed in his computer or mobile phone. It freezes the system and sends data to a command-and-control site.

From there, hackers receive information that allows them to seize control of accounts and blackmail duped users.

Everyone can be a victim of ransomware. According to one report, half of the cyber attacks happening worldwide target small businesses. It also reveals that:

• Small businesses lack security resources to protect themselves from these attacks.

• Health service providers are concerned about security breaches that stop them from doing their jobs.

• Banks are worried that confidential information can be stolen.

• People who use their phones for bank transactions are the usual victims of phishing attacks. Malware can discreetly infiltrate their devices. Login credentials or information can be stolen when shared in fake banking applications. Once they type in their details on a fake login page, information theft happens without their knowledge.

THE CYBERCRIME PREVENTION ACT OF 2012
To address these modern offenses, the Philippine Cybercrime Prevention Act of 2012 was passed to focus on the pre-emption, prevention and prosecution of cybercrimes such as offenses against the confidentiality, integrity and availability of computer data and systems, computer-related offenses and content-related offenses.

The law punishes cybercriminals. These are individuals or teams of people who use technology to commit malicious activities on digital systems or networks with the intent of stealing sensitive company information or personal data, and generating profit.

Certainly, while the law has been in place for almost a decade, the challenge of tracing the identity of cybercriminals remains. They often hide by masking their Internet Protocol Address, routing traffic through various servers worldwide.

ESTABLISH TRUST STRATEGY IN RELIABLE WAYS
Given the difficulty of catching and prosecuting cybercriminals, we need a cybersecurity plan that people can trust. People should feel safe about the information they share online. They ought to know that their private data will not be accessible to unauthorized parties from the devices they use.

Some of the ways to design safe systems are cryptography, digital certificates and encryption. Another way is to use secure network connection. Even if using a VPN or firewall helps protect a private connection, the user must consistently check and update software, apps and devices to minimize the risks of cyber attacks.

  In addition, customers who frequently change passwords can minimize their risks. With proper and sufficient identity checks, they are also able to prove that they are the legitimate owners of their accounts.

On the other hand, cyber attackers leave some traces most of the time. The hints include the IP address, e-mail address, domain names and bits of text from the attacker.

Clearly, when you find out how hackers attack your system, you can avoid more attacks by putting new security controls in place.

Another way to accomplishing a reliable trust strategy is to have the right approach to protecting data. Here are some foolproof ways to achieve this:

• Back up your customers’ important personal information in systems that are not connected to the internet. Make sure that they are coded. If you lose their information and they lose their trust in you, they will move their business elsewhere.

• Assess the strength of your system and review your setup. Put programs in place that can detect weaknesses in your network early and respond to threats.

• After you’ve set up everything, test your system protection methods on both existing and new customers. This allows you to check if your setup is effective and if it meets your organization’s objectives.

• Talk to top management and get their feedback on your setup. That way, you can find out if your cybersecurity strategy can be trusted.

• Finally, review your cybersecurity strategy periodically to make sure that it remains effective.

Without trust in government and private online transaction systems, cybercriminals will continue to deceive customers. It is time to build a strategy where trust comes first.

The views or opinions expressed in this article are solely those of the author and do not necessarily represent those of PricewaterhouseCoopers Consulting Services Philippines Co. Ltd. The content is for general information purposes only, and should not be used as a substitute for specific advice.

 

Raquel Marasigan is a manager of the Cyber and Forensics practice of PricewaterhouseCoopers Consulting Services Philippines Co. Ltd., a Philippine member firm of the PwC network.

raquel.marasigan@pwc.com

Philippines logs 2nd lowest virus tally in 17 months

PHILIPPINE STAR/ MICHAEL VARCAS

PHILIPPINE health authorities reported 370 coronavirus infections on Monday — the second-lowest daily tally in 17 months — bringing the total to 2.84 million.

The death toll hit 49,761 after 171 more patients died, while recoveries increased by 859 to 2.77 million, the Department of Health (DoH) said in a bulletin.

The agency said two laboratories did not operate on Dec. 6, while five laboratories failed to submit data.

DoH logged 356 coronavirus infections on Tuesday, the lowest since July 2, 2020, when 294 cases were reported.

The Philippines had yet to detect the Omicron variant, which was first detected in South Africa, Health Undersecretary Maria Rosario S. Vergeire separately told an online news briefing.

The Omicron variant appeared to be no worse than other coronavirus strains, Agence France-Presse reported on Wednesday, citing top scientists from the World Health Organization (WHO) and United States, even as they said more research was needed to judge its severity.

The assessments came as markets were riled by the emergence of the heavily mutated variant, which has forced dozens of countries to again tighten borders and raised the possibility of fresh lockdowns that could burden the global economy.

The local Health department said the Philippines had 12,510 active cases, 883 of which did not show symptoms, 4,974 were mild, 3,916 were moderate, 2,261 were severe and 476 were critical.

The agency said 19% or the 171 reported deaths occurred in November, it said.

It said 27 duplicates had been removed from the tally, 25 of which were reclassified as recoveries and one as a death, while 150 recoveries were relisted as deaths.

It added that 95 patients had tested negative and were removed from the tally. Of these, 92 were recoveries.

DoH said 24% of intensive care units in the Philippines were occupied, while the rate for Metro Manila was 24%.

The Philippines’ ranking in a global index that measured the recovery of more than 100 countries from the coronavirus pandemic has improved recently, after the Southeast Asian country managed to contain a spike in infections fueled by the highly contagious Delta coronavirus variant.

The country jumped 46 notches to 57th in the latest COVID-19 recovery ranking by Nikkei Asia.

In a report on Monday, the Tokyo-based news magazine said the Philippines’ ranking improved due to a “significant increase in its infection management scores.”

But while the country’s infection numbers had dropped from the peak in September, its short-term death rate was more than 9% — the second-highest in the world, according to the report.

The Health department on Wednesday said the country’s coronavirus death rate as of Dec. 7 was 1.61%, below the global average of 2%.

“After cases and deaths peaked in Sept. 2021, both have continuously declined along with the monthly case fatality rates,” it said in a separate statement.

DoH noted that the Philippines death rate used in the Nikkei report was from Our World in Data, whose calculation was based on the number of reported deaths per day from Nov. 18 to 27.

The agency noted that of 2,096 deaths reported for that period, only 16% occurred in November, while 80% occurred between August and October.

“The high reported deaths in this latter part of Nov. 2021 were due to delayed encoding, validation and reporting of death information.”

“The COVID-19 deaths have to be verified by local epidemiology and surveillance units on the ground,” it added.

“We are aware of the delays in encoding of death information,” the agency said, adding that “we are addressing this issue with the epidemiology and surveillance units to ensure our COVID-19 data are up to date.”

The coronavirus has sickened 267.4 million and killed 5.3 million people globally, according to the Worldometer website, citing various sources including data from the World Health Organization.

Almost 241 million patients have recovered, it said.

The United States had the most infections at 50.27 million with 812,205 deaths, followed by India with 34.66 million infections and 473,952 deaths.

They were followed by Brazil with 22.16 million infections and 616.067 deaths; the United Kingdom with 10.56 million cases and 145,826 deaths and Russia with 9.86 million infections and 283,644 deaths.

The Philippines was ranked 19th. — Kyle Aristophere T. Atienza and Norman P. Aquino

DoH locates 1 of 8 returning workers from South Africa

PHILIPPINE STAR/EDD GUMBAN

HEALTH authorities on Wednesday said they have found one of the eight travelers who arrived in the Philippines from South Africa, where the Omicron coronavirus variant was first detected.

The returning migrant Filipino worker had tested negative for the coronavirus and was under home quarantine, Health Undersecretary Maria Rosario S. Vergeire told reporters in a Viber message.

The seven returning migrant Filipino workers had not been found, she added.

Of the seven missing travelers, three did not provide contact details, one gave an incorrect contact number and two remained unresponsive, Ms. Vergeire said.

“We are continuously getting in touch with our local government units and other partners to be able to contact these individuals.”

The Department of Health (DoH) earlier said that 253 travelers from South Africa arrived in the country from Nov. 15 to 29.

Ms. Vergeire has appealed to the travelers to contact the local DoH offices so they can get tested and prevent a potential transmission of the heavily mutated Omicron variant.

The Philippines has suspended inbound flights from South Africa, Botswana, Namibia, Zimbabwe, Lesotho, Eswatini and Mozambique, Austria, Czech Republic, Hungary, The Netherlands, Switzerland, Belgium and Italy until mid-December to prevent an outbreak of the Omicron variant. — Kyle Aristophere T. Atienza

Transport groups seek halt to excise tax on fuel despite price cuts

PHILSTAR

By Russell Louis C. Ku

TRANSPORT WORKERS urged Congress to suspend or lower the excise tax on fuel products, saying the recent decline in global oil prices was nothing compared with the overall rise this year.

Oil prices increased 10 times from Aug. 30 to Oct. 22, said Mody Floranda, president of the Pinagkaisang Samahan ng mga Tsuper at Operators Nationwide (PISTON). He noted that local diesel prices rose by as much as P18.50 a liter, while gasoline prices increased by as much as P22.50.

Declining global oil prices might be temporary, he said by telephone on Dec. 2, adding that he expects the petroleum prices to increase again in the next three months due to increased demand amid easing lockdowns.

On Tuesday, oil companies lowered the price of gasoline by P2.40 a liter, while diesel and kerosene prices fell by P2.65 and P2.70, respectively.

Mar S. Valbuena, president of the Samahang Manibela Mananakay at Nagkaisang Terminal ng Transportasyon, said the suspension of the excise tax would help drivers whose livelihood had been affected by the coronavirus pandemic.

“We don’t earn much because there are few passengers,” he said by telephone in Filipino on Dec. 3. “There are also costs we have to worry about such as maintenance and parts for our vehicles.” He added that public utility vehicle drivers earn as little as P150 a day.

House Bill 10488 seeks to temporarily scrap the excise taxes on diesel, kerosene and liquefied petroleum gas (LPG) for six months.

The excise tax on low-octane gasoline will be lowered to P4.35 a liter, while the tax on premium gasoline will stay.

Fuel tax will revert to rates under the Tax Reform for Acceleration and Inclusion (TRAIN) Law once global crude oil prices hit $65 a barrel.

The law raised the excise tax on fuel in three tranches from 2018 to 2020. The tax rates are P10 a liter for gasoline, P6 a liter for diesel, P5 a liter for kerosene and P3 a liter for LPG.

The Department of Finance has opposed the House bill, saying it would result in P37.5 billion in foregone revenue and only help the rich.

But Mr. Floranda and Mr. Valbuena said scrapping the excise tax would benefit both the rich and poor.

Mr. Valbuena said lawmakers should come up with a compromise. “The suspension will be temporary, so for the meantime the government should find other ways to recover the lost revenue during the six-month period.”

The industry is also amenable to cutting the suspension period to four or five months, he added. He said Congress could limit the suspension of excise tax to public utility vehicle operators.

Mr. Floranda said changes to the Oil Industry Deregulation law would also help stabilize fuel prices.

Pampanga Rep. Juan Miguel M. Arroyo, who heads the House energy committee, has filed House Bill 10505, which will require oil companies to maintain a minimum inventory of 30 days. They must also disclose their costs from importing fuel.

As of Nov. 30, year-to-date pump prices for gasoline and diesel have increased by P18.10 a liter and P15.70 a liter respectively, according to data from the Department of Energy.

Senate ratifies bill providing accessible education for learners with disabilities 

NCDA.GOV.PH

THE SENATE ratified late Tuesday the reconciled version of a bill mandating all schools, whether private or public, to ensure accessible education for learners with disabilities.  

The proposed law also provides that no learner should be denied admission on the basis of their disability.  

“This landmark legislation would deliver quality, accessible and inclusive education for learners with disabilities in our country, especially for those who were left behind by our basic education system,” Senator Sherwin T. Gatchalian, who chairs the Senate committee on basic education, arts and culture, said during the plenary session.  

The bicameral conference committee report tackled the disagreeing provisions of Senate Bill 1907 and House Bill 8080, mandating the Department of Education in cooperation with local government units to establish and maintain at least one Inclusive Learning Resource Center (ILRC) in every city and municipality.  

The ILRCs composed of multidisciplinary experts will serve as a one-stop-shop for the delivery of free support services to learners with disabilities and the implementation of inclusive education programs.   

Services would include linguistic solutions for deaf learners, physical and occupational therapy, counseling and rehabilitation, medical and transport services, and speech-language pathology.  

Under the proposed measure, minimum services and conditions will be set in the admissions systems and policies of all schools, including provisions on assistive devices, facilities and infrastructure, accommodation, among others.  

The Senate approved the bill on final reading in May, while the House passed it in Dec. last year.  

Once ratified by the lower house, the bill will be sent to President Rodrigo R. Duterte for his signature.  

ALTERNATIVE LEARNING BUREAU
Meanwhile, the Department of Education has set up an office that will focus on the existing alternative learning program intended for out-of-school youth, adults, learners with disabilities, and other special cases, in line with the Alternative Learning System (ALS) Act that was signed into law in December last year. 

“This will strengthen our initiatives, programs, and policies for the out-of-school children in special cases, youth, and adults as we ensure their educational continuity,” Education Secretary Leonor M. Briones said in a statement on Tuesday. 

Department of Education Order No. 47-2021 establishes the Bureau of Alternative Education, which will be in charge of coordinating with other government agencies, local government units, and the private sector to ensure sustainable implementation of learning projects outside the formal education system.  

The bureau is also tasked to establish minimum quality standards in the development of the ALS curriculum and learning materials, program planning, implementation, management, monitoring, and evaluation. — Alyssa Nicole O. Tan and Marifi S. Jara 

Labor group presses for lifting of ‘no vaccine, no work’ policy 

DOT

LABOR group Kilusang Mayo Uno (KMU) is pressing for government action on its call to lift the “no vaccination, no work” policy, citing the right of workers to make the personal choice of whether to get jabbed or not against the coronavirus.   

The militant group condemned the Department of Labor and Employment (DoLE) for its lack of initiative to stop the vaccine requirement, which are contained in resolutions 148-B and 149 issued by the task force managing the pandemic response.   

“It’s frustrating that DoLE cannot stand up for the rights of workers,” KMU Chairman and Makabayan senatorial candidate Elmer Labog said in a statement in Filipino released on Tuesday.   

Mr. Labog said they had heard nothing from the department except that it did not have a choice but to abide by the resolutions, which mandate vaccination for on-site workers.    

“They turned their backs on their own Labor Advisory 3, Series of 2021 that disallows ‘no vaccine, no work’ in workplaces,” he said.  

The labor leader said that vaccination “cannot and should not be forced unto individuals.”   

He also noted opposition to the requirement for unvaccinated workers to get tested regularly at their own expense.  

Many workers in the capital region earn only about P500 a day, while testing for coronavirus costs at most P4,000, he said, adding that many have lost their jobs.    

The Philippine Statistics Authority data showed that the unemployment rate of the country in October was at 7.4%, the lowest jobless rate reported since July’s 6.9%. In absolute terms, there were 3.5 million unemployed Filipinos in October.  

Underemployment, meanwhile, stood at 16.1% in October, higher than the 14.2% posted in September. 

Labor Secretary Silvestre H, Bello III has yet to reply to a request for comment. — Alyssa Nicole O. Tan 

Red tide warning raised in Milagros, Masbate  

THE BUREAU of Fisheries and Aquatic Resources (BFAR) issued a new warning in Milagros, Masbate after the area tested positive for paralytic shellfish poison, or commonly known as red tide.    

BFAR said in its 34th shellfish bulletin dated Dec. 6 that red tide warnings also remain in Bataan, specifically Mariveles, Limay, Orion, Pilar, Balanga, Hermosa, Orani, Abucay, and Samal.  

In the Visayas, positive areas are Dauis and Tagbilaran City, Bohol; Carigara Bay, Leyte; and Guiuan and Matarinao Bay, Eastern Samar. 

In Mindanao, warning was still up in Dumanquillas Bay, Zamboanga del Sur; Baroy, Lanao del Norte; and Litalit Bay, Surigao del Norte.    

According to BFAR, all types of shellfish and Acetes sp. or alamang coming from areas with ongoing red tide warnings are not suited for human consumption. Other marine species from the same waters can still be eaten with proper handling.   

Red tide happens as a result of high concentrations of algae in the water. Human consumption of contaminated shellfish may result in paralytic shellfish poisoning, which affects the nervous system.   

Usual symptoms of paralytic shellfish poisoning include headache, dizziness, and nausea. Severe cases may cause in muscular paralysis and respiratory problems. — Revin Mikhael D. Ochave  

No COVID patients in 2 major hospitals in Makati

OSPITAL NG MAKATI FACEBOOK OFFICIAL PAGE

TWO major hospitals located in Makati, with a combined bed capacity of 950, have no coronavirus disease 2019 (COVID-19) patients admitted as of Wednesday, according to the mayor. 

The city-run Ospital ng Makati (OsMak), which has 350 beds, has not recorded any new COVID-19 case since Nov. 24, Makati Mayor Abigail S. Binay said in a statement.  

“Earlier this month, we had 54 patients with COVID-like symptoms at OsMak. Fortunately, they all tested negative after undergoing RT-PCR tests. Therefore, we have zero COVID cases at OsMak,” she said.  

Privately-owned Makati Medical Center (MMC), through its medical director Saturnino P. Javier, also confirmed earlier that the 600-bed healthcare institution had no coronavirus admissions “for the first time in 20 months since March 2020.” 

Makati, a major business district in the capital region, is currently under low-risk classification with 31 active cases, based on data from the Makati Health Department.  

Ms. Binay said local health authorities attributed the low number of active cases to the city’s high vaccination rate, availability of rapid antigen tests and RT-PCR tests, surveillance and early isolation or quarantine of suspected COVID-19 patients, and strict implementation of minimum public health standards.  

Makati has vaccinated 439,185 individuals or more than 70% percent of its population of 624,560.   

The mayor said the city’s vaccination drive, in partnership with the private sector, is continuing.   

Ms. Binay also stressed the need to continue observing minimum health protocols such as wearing of face mask and physical distancing, especially with the “looming threat” of the Omicron variant.  

“Even if we are now under the low-risk classification, we should remain vigilant. It may only be a matter of time before the Omicron variant makes its way to our country,” she said. 

PEF welcomes another eagle

PEF

THE PHILIPPINE Eagle Foundation (PEF) based in Davao City announced earlier this week the hatching of the 29th nestling bred in captivity. “Chick no. 29 hatched on Dec. 4 at 1:16 p.m., 25 hours and 13 minutes since it first poked its beak and cracked the egg. Seems like a long time, but actually it is the fastest pip-to-hatch record in our breeding program,” the foundation said. The new eagle’s parents are Ariela and MVP Matatag, who are both rescued.

Cash is dying, but we aren’t ready to bury it

JP VALERY-UNSPLASH

THE DEMISE of cash is near. As consumers, though, we should hope that the end doesn’t arrive too soon.

It isn’t the pandemic that’s putting this popular means of payment out of existence. All that COVID-19 has done is to accelerate a trend that was already with us. When Steve Jobs unveiled the first iPhone in 2007, he began killing the need for banknotes. Autonomous cars, self-ordering refrigerators, and our digital avatars in the metaverse will put the final nails in King Cash’s coffin.

COVID-19 shifted $5 trillion in global retail sales from offline to online. To the extent that a big chunk of this value was transacted in cash (47% in the euro area), the idea that central-bank-issued currency was a must for purchasing daily essentials took a knock. After an initial bump in precautionary cash hoarding, curbs on mobility and the fear of catching germs from handling paper money forced a change in habits.

Where governments gave out vouchers to perk up spending — like in Hong Kong — millions of consumers and thousands of merchants became new users of online payment systems just to utilize the handouts. Many will likely continue using these new ways to settle bills.

But just how crucial were these changes in the overall scheme of things? The different trajectory of banknotes in China and India provides a natural experiment to gauge the relative importance of temporary shocks and steady technological change.

Cash use plummeted in India after Prime Minister Narendra Modi cancelled 86% of the existing legal tender overnight as part of a botched economic experiment. That was five years ago. Nowadays, digital payments are booming, but cash is once again 14% of the broad money circulating in the economy — the same as before demonetization. In China, where physical currency was made irrelevant by the growing ubiquity of Alipay and WeChat Pay, the central bank’s IOUs to the public account for only 4% of money.

Technological progress lacks the drama of a behavioral shock, but it’s no less stunning. As JPMorgan Chase & Co.’s Jeremy Balkin and Neha Wattas remind us, the fastest way to move money from New York to London as recently as 2010 was to catch a flight from JFK to Heathrow and deliver it in person. Their report, provocatively titled “Payments Are Eating the World,” notes several shifts taking place in unison. In China, super-app platforms transformed money; elsewhere, the rise of a creator and gig economy is doing it. Globally, 50 million people are blogging, making short videos or telling people what to buy on the internet — and getting paid online as well.

Digital wallets are mushrooming everywhere, but what gets stored on them is changing because of another technological revolution: blockchain. Fintech firm Circle has teamed with Visa, Inc. to enable business customers to spend USD Coin — a currency on the Ethereum blockchain that pegs its value to the dollar — with 70 million merchants. An equally important phenomenon is “buy now, pay later,” which is embedding finance (and cashless payments) even into low-value transactions: like buying lipstick in three installments.

Wait until each of our 15 internet-of-things devices does its own shopping, using central bank-issued programmable digital cash to pay only when they get the right stuff. While all this is happening in the real world, an entirely new parallel stream of consumption in the alternate reality of the metaverse could be as substantial as $390 billion by 2025.

Innovation in payments is an even bigger phenomenon in emerging markets than in developed economies. Last month, smartphone-based apps running on a shared public utility cleared the equivalent of $100 billion in domestic Indian payments, rising from less than $15 million five years earlier. And this is just the beginning. Alphabet, Inc.’s Google, which alone handled $38 billion of these instantaneous transfers, has now developed an Android-based sub-$100 phone. The idea is to bring mobile internet to the bottom of India’s consumption pyramid.

Cash is still coveted, especially in a highly informal economy like India’s. But its importance as a means of payment is declining. In 2003, about 35% of cash in the euro area was used in domestic transactions; that number fell to an estimated 20% in 2019. Anywhere between 30% to half of banknotes have ended up overseas, while the rest are being hoarded in the euro zone: To some investors, a safe sovereign liability that pays zero is better than negative-yielding government bonds.

As cash vanishes into vaults — without a central bank digital currency, or CBDC, replacing it — the public’s trust in the convertibility of deposits into official money may become “more of a theoretical construct than a daily experience,” according to a recent research paper by the European Central Bank’s Ulrich Bindseil and others. That can destabilize entire financial systems.

If all the money in circulation is private, controlled by e-commerce and social media platforms, authorities won’t be able to protect consumers from being exploited. Which is why even in countries where technology has turned it into an anachronistic appendage, cash can’t be allowed to die. Not before CBDCs are ready.

BLOOMBERG OPINION

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