DECRYPT: Escaping the Marketing Gamespace of Mediocrity

June 17, 2022 | 11:00 am

The AU2NTIC Productions is a nonprofit academic organization composed of students taking up Bachelor of Science in Marketing Management (BSBA-MM) Section 4-2N in Polytechnic University of the Philippines (PUP) — Sta. Mesa, Manila. It aims to deliver the latest and authentic marketing contents that will inform, entertain, and uplift marketing students.

Its upcoming event entitled, “DECRYPT: Escaping the Marketing Gamespace of Mediocrity,” aims to focus on interconnecting marketing and analytics in the present-day state of pandemic and post-pandemic.

DECRYPT is a free admission webinar of The AU2NTIC Productions to be held online via Zoom and Facebook Live on July 2, 2022 from 1:00 p.m. to 5:00 p.m. It will cater to Marketing students from PUP, including PUP SHS and OUS, as well as partner schools. It has a three-part discussion consisting of three topics with respective subtopics and real-life case studies.

The event will have high-caliber and top-of-the-line speakers, to be called as the gamemasters, to discuss the chosen topics:

1) The Emerging Importance of Value Creation Process for Startup Businesses in the New Normal;

2) Identifying Brand DNA to Develop a Killer Brand Strategy; and

3) Utilizing Marketing Analytics and Data Science in Creating Trends

The topics are bound to represent the life of a business — from creating a value for a startup business, to creating a brand identity and developing a killer brand strategy, up to reaching the end result of being the best-in-class by creating data-driven trends. While value creation and brand identity are strong needs of a business, life does not end from being known and differentiated from competitors. Businesses’ blood is customers — the paying ones. Hence, they will want to create a campaign trend that is important in conversion that can be done through marketing data science. The topics and theme of this webinar are formed in the aim of delivering the message of ‘escaping the mediocrity in the current state of the market’ and dare to be a brand that stands out.

Other much-awaited things for this event are the guest performers, freebies to every student from brand partners, and competitions where the students can join and share their skills and creativity, be recognized for their wits, and win exciting prizes as they attend and participate.

Line up with the bravest players by filling out this pre-registration form: https://forms.gle/ryMpP4GkueX4i5zh7.

Get ready to fearlessly play your own game!

HIGHLIGHTS OF THE EVENT: High-caliber speakers, upskill in marketing and analytics, real-life cases and application of topics, learning at their own convenience, e-certificates, guest performers, pre-event competitions, the announcement of games and raffle winners, freebies, and vouchers

Revlon files for bankruptcy, blames supply chain snags

June 17, 2022 | 10:57 am

Cosmetics maker Revlon Inc. has filed for bankruptcy, falling victim to global supply chain disruptions that pushed up raw material costs and prompted vendors to demand upfront payments.

Known for its nail polishes and lipsticks, the 90-year-old company in recent years has lost shelf space and sales to startups backed by celebrities such as Kylie Jenner’s Kylie Cosmetics and Rihanna’s Fenty Beauty.

In its bankruptcy filing, Revlon said supply chain disruptions in the spring prompted intense competition for ingredients used to make its products. At the same time, vendors that traditionally offered up to 75 days for payment began demanding cash in advance of new orders, while labor shortages and inflation added to its troubles, it said.

“For example, one tube of Revlon lipstick requires 35 to 40 raw materials and component parts, each of which is critical to bringing the product to market,” Robert Caruso, who was hired as Revlon’s chief restructuring officer, wrote in a court filing.

“With shortages of necessary ingredients across the company’s portfolio, competition for any available materials is steep.”

The coronavirus disease 2019 (COVID-19) pandemic has lengthened ship delivery times since 2020, pushing up freight costs, while the Russia-Ukraine conflict and lockdowns in Shanghai have added to supply chain disruptions this year.

Shares in Revlon fell as much as 44% on Thursday on the bankruptcy filing before closing down 13%.

The shares had halved in market value between last Thursday and close of trading on Wednesday. Media reports of a potential bankruptcy filing emerged on Friday.

DEBTS MOUNTED

Revlon, which was formed in 1932 by brothers Charles and Joseph Revson and Charles Lachman, started off selling nail enamel. It was sold in 1985 to MacAndrews & Forbes – which remains the controlling shareholder and is owned by Ron Perelman — and went public 11 years later.

Revlon bought Elizabeth Arden in an $870 million skincare bet in 2016 to fend off competition. It houses brands including Britney Spears Fragrances and Christina Aguilera Fragrances.

But the company’s sales lagged over the years and in 2021 fell 22% from its 2017 levels. In contrast, competitors like CoverGirl, owned by Coty Inc., have gained market share by investing heavily to improve supplies.

The company also made headlines two years ago when Citigroup Inc. accidentally sent nearly $900 million of its own money to Revlon’s lenders.

Revlon asked its bankruptcy judge to confirm that the Chapter 11 filing would not stop Citibank’s ongoing appeal over the $504 million it is still trying to recover from Revlon lenders. A quick prompt resolution of the dispute would help its bankruptcy case move forward, it said in court papers.

The mistaken payment is part of a complex battle between Revlon’s pre-bankruptcy lenders, who have jockeyed for control during Revlon’s attempts to defer debt payments.

An attorney representing junior creditors, Clark Whitmore, said in court that the senior lenders’ “feeding frenzy” would destroy value for stakeholders that are lower on the food chain.

Revlon plans to fund its bankruptcy case with $575 million in debtor-in-possession financing from its existing lender base. It listed more than $3.54 billion in liabilities in its court filing late on Wednesday.

The company said none of its international units, except Canada and the United Kingdom, are part of the Chapter 11 bankruptcy proceedings.

Mittleman Brothers Investment Management, which holds about 3% of the company’s stock, expressed hope equity holders would manage a decent payout despite the bankruptcy.

That could happen if Revlon manages higher sales that allow it to overcome supply chain issues, Chris Mittleman said in an email to Reuters. — Reuters

Human capital development should be a central pillar of incoming Marcos admin — ADB

June 17, 2022 | 10:01 am

By Revin Mikhael D. Ochave, Reporter

LOCAL human capital development should be a central pillar for the incoming Marcos administration to improve the country’s competitiveness ranking, according to the Asian Development Bank (ADB).

Sameer Khatiwada, ADB Southeast Asia Department social sector specialist, said during the webinar of the Asian Institute of Management Rizalino S. Navarro Policy Center for Competitiveness on Thursday that the Philippines needs to address the learning loss incurred due to the closure of schools caused by the coronavirus disease 2019 (COVID-19) pandemic.

President-elect Ferdinand R. Marcos, Jr., is set to take office on June 30.

“As the new administration comes in, the human capital development agenda has to be a central pillar of increasing/enhancing Philippines’ competitiveness,” Mr. Khatiwada said.

“Infrastructure and human capital are the two basic ingredients for growth in investments. The learning loss that we saw because of school closures, I think we have to take this seriously and come up with concentrated efforts in reversing that,” he added.

Further, Mr. Khatiwada said that the long closure of schools due to the COVID-19 pandemic will have a “huge impact” on the country’s human capital development, noting the Philippines’ ranking in the Programme for International Student Assessment (PISA).

“The Philippines was among the few countries where the schools were closed for almost two years. This is likely to have a huge impact. We ought to really be serious about this,” Mr. Khatiwada said.

“If we want to talk about competitiveness of the Philippine economy going forward, unless we invest in human capital development, unless some of these learning losses are reversed or addressed with some targeted measures, I think it will be very difficult to catch up,” he added.

In the 2018 PISA, the Philippines ranked last among 79 participating countries and economies in terms of reading comprehension, and placed second to the last in science and mathematics. The Education department in March announced that it will participate in the 2022 cycle of the PISA, which is conducted by the Organisation for Economic Co-operation and Development (OECD).

Based on the recently released 2022 World Competitiveness Report by the International Institute for Management Development (IMD), the Philippines climbed four spots to 48th out of 63 countries, the highest it had in two years after securing the 45th place in 2020.

The report looked at a country’s competitiveness based on economic performance, government efficiency, business efficiency, and infrastructure.

In 2022, the Philippines improved its economic performance to 53rd, while its infrastructure ranking also increased to 57th. However, the country’s business efficiency fell to 39th while its government efficiency also declined to 48th.

Meanwhile, American Chamber of Commerce of the Philippines Senior Adviser John D. Forbes said that the government should be more flexible on hybrid work arrangements and the tax incentives of registered business enterprises.

“The government doesn’t recognize what’s happening in the world. The workers do not want to go back into the office. They have gone home. They realized that it is nicer to work-from-home (WFH). They don’t have to commute. The government has to be more flexible on this,” Mr. Forbes said.

The government has previously mandated registered business enterprises, including information technology and business process management (IT-BPM) firms, located in economic zones to return to 100% on-site work or risk losing tax perks in a bid to help economic recovery.

Starting a smart education business opportunity

June 17, 2022 | 10:00 am

Main Photo — Kumon Philippines, Inc. (KPI), one of the leading education franchises in the country and abroad, provides a rewarding career and profitable business to its Franchisee-Instructors.

The global business arena has seen strong franchises make their mark in their respective industries. As these enterprises show steady growth and expand overseas, they appeal to discerning local entrepreneurs who are on the lookout for profitable and worthwhile franchise opportunities.

In the field of education franchising, one of the most well-established franchises in the Philippines and across the world is Kumon. Kumon was able to establish its name in the franchise arena as they have provided and continue to provide top-notch and consistent support needed to build a rewarding career and profitable education business.

A leading franchise

Before being one of the top global education franchises, Kumon began with its founder, Toru Kumon, a gifted math teacher, who hoped to improve his son’s math abilities, devising what is now distinctively known as the Kumon Method of Learning. He eventually sought to develop the potential of more children in a similar way, leading him to establish the first Kumon Center in Osaka, Japan, in 1958.

Since then, the Kumon Method has evolved and grown with millions of Franchisee-Instructors in different regions of the world. The Kumon franchise now extends to 65 countries, including Australia, India, United Arab Emirates, Singapore, South Africa, Switzerland, Canada, Mexico, and more. Kumon reached the Philippines in 1996, where its franchise has grown with over 300 Kumon Centers across the country.

The Kumon Franchise advantage

Kumon Franchisee-Instructors are guaranteed support even before the start of operations, to the setting up of the business, until Centers are operational, and beyond.

Helping assure that franchisees can earn from their education business, Kumon provides a well-researched List of Open Areas, showing ideal locations with growth potential.

Would-be Kumon Franchisee-Instructors undergo hands-on training under Kumon Philippines, Inc.’s (KPI) Franchise arm to maintain the top-notch quality of the Kumon Method of Learning. The online training also includes business strategies for owning and operating a Kumon Center. The training is conducted online for the safety and convenience of prospective franchisees.

Thriving amidst the pandemic, KPI ensures the safety of its Franchisee-Instructors by providing hands-on online training on center management, instruction, and other continuous online learning opportunities.

Further ensuring the steady growth of Centers, Kumon Associates and Area Development Managers also provide consistent support in administering the Kumon Programs and managing the Centers.

While Kumon Franchisees can capitalize on Kumon being a successful global brand and a household name in the education business, KPI couples this by providing consistent and aggressive communication and marketing support.

The uniqueness of the Kumon Method itself makes the franchise a promising opportunity. Unlike competitors, whose services are seasonal, the demand for Kumon and its enrollment is year-round, and its programs are long-term. Students stay long-term as they improve and work through the program levels. This uniqueness poses financial stability, builds strong customer loyalty, and stirs a sense of fulfillment for the Franchisee-Instructor.

As a franchisor placing the highest respect for Kumon Instructors, the Kumon group enhances franchisees’ personal and professional growth and development by exposing them to different learning opportunities in the Philippines and abroad. They are given the opportunity to join continuing training, meetings, and seminars and build a network with Kumon franchisees from all over the globe.

Kumon continues to establish itself as the leading afterschool program and education franchise in the Philippines and abroad. The company’s steady growth can be attributed to its reputation in the industry and solid partnership with stakeholders, particularly its current and potential Franchisee-Instructors.

Franchising with Kumon provides support and an opportunity to be part and grow with a renowned global brand — all while helping children discover and develop their potential, which could empower them to reach their dreams and goals.

Build a profitable and fulfilling education business venture with Kumon now: https://ph.kumonglobal.com/franchise-enquiry/

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PCC hematologists share advancements in blood cancer treatments

June 17, 2022 | 9:00 am

Singapore faces a stable increase in blood cancer patients. Promisingly, a chance of better treatment for such incidents emerges from the developments in cancer research and technology.

In a virtual open dialogue, senior consultants specializing in hematology at Parkway Cancer Centre (PCC) in Singapore highlighted the progress in blood cancer treatments, particularly the possibilities of making them individualized.

Most blood cancer patients during the mid-1960s to mid-1990s experienced poor outcomes with the treatments. But from the mid-1990s up to now, “there’s been a lot of exciting and revolutionary advances,” said Dr. Teo Cheng Peng.

Dr. Colin Phipps Diong talked about leukemia and introduced the Chimeric Antigen Receptor T-cell (CAR T-cell) therapy which involves taking a patient’s T-cells and modifying the cells in the laboratory to make them recognize certain targets on certain cancers. Those cells would be given back to the patient through an infusion.

While effective, such a therapy is expensive. Early clinical trials also saw the therapy “killed so many leukemia cells all at once; when [the leukemia cells] died in the body, they release a lot of the toxic stuff inside the cells, and that overwhelmed certain patients,” Dr. Diong said.

“Thankfully, we now know how to deal with these complications, and how to preemptively — or you can say preventively — treat so that these severe complications that cause death are minimized,” he said.

Moreover, CAR T-cell is a targeted therapy which means it cannot be used for all cancer types.

“The two approved indications for CAR T-cell therapy in Singapore at this point [are] against the B-cell acute lymphoblastic leukemia and large B-cell lymphoma,” Dr. Diong said.

“As yet, we do not know what is the best way to target acute myeloid leukemia or T-cell lymphoma with CAR T-cells. There is still a lot of development that needs to happen in the CAR T-cell therapy,” he added.

Dr. Dawn Mya discussed multiple myeloma, a cancer originating from plasma cells. Since multiple myeloma remains incurable, she said that they concentrate on achieving remission with treatment.

“Our treatment is mainly focusing on symptom control, at the same time trying to improve the quality of life; together with prolonged remission as much as possible while trying to delay the time to relapse,” said Dr. Mya.

She divided the treatment into definitive treatment (usually combination therapy) and supportive care.

Dr. Mya also shared new advancements in multiple myeloma treatments like several classes of drugs for medical therapy. There are also immunotherapy and other specific therapies such as bispecific T-cell engagers and cell therapy like the CAR T-cells, which are in clinical trials and may be available soon.

As for lymphoma or the type of blood cancer involving the lymphatic system, Dr. Lee Yuh Shan said that its various subtypes have a different treatment approach.

Developments on lymphoma treatments are also on the horizon, said Dr. Shan. These are immunochemotherapy and BCL-2 inhibitor, new bispecific antibody, and the CAR T-cells.

“Treatment outcomes [are] improving over the years with the new agents, which are more effective,” Dr. Shan observed.

“Personalized treatment is very important,” he added. “We have to take into consideration the tumor type, the disease status, the mutation of the tumor, as well as the fitness of the patient to improve the outcome of this patient with lymphoma.”

For inquiries, please contact Parkway Hospitals Singapore – Manila office located at G/F-B, Marco Polo Hotel, Meralco Avenue and Sapphire Street, Ortigas Center, Pasig City 1600; email
manila.ph@parkwaypantai.com; or call 0917-526-7576. Visit parkwaycancercentre.com/ph/home and CanHope Manila’s Facebook page for more information.

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9 essential power tools in building your home

June 17, 2022 | 9:00 am

When constructing a home, every builder knows that efficiency and precision is vital in establishing a sturdy and stable structure. Aside from the structure, every homeowner and builder must also pay attention to the details of furnishing to achieve the home’s complete and refined look. Get the best home building partner using power tools from Hills!

Hills power tools are equipped with suppression capacitors that suppress interferences that enter the device from the outside and protect the device. Hills power tools are also designed with efficient ventilation and cooling to guarantee that heat is effectively dissipated, extending the machine’s service life. Check out these 9 handy power tools from Wilcon Depot to help you get the job quicker and safer:

1. Orbital Sander

Orbital sanders are often used to polish rough surfaces of wood, remove rust and paint on metal, and create a smooth, fine finish on plastic. This handy power tool can be effectively used in making furniture, re-doing your car paint, or refining hardwood floors. Use this square-shaped sander to smoothen corners and edges and capture every inch of the surface project.

2. Jigsaw

Jigsaws are a DIY-er’s must-have tool. This power tool offers precision and efficiency in cutting intricate shapes of wood. It is perfect for handling curved edges that require a fine cut for a more professional-looking project. This portable tool comes with a hex wrench, blade adjust block, jigsaw blade, and carbon brushes.

3. Drills

Depending on the amount of work needed to complete the task, drills are an essential tool in cutting the work time in half. Hills carries a variety of drills to meet your home building and renovating needs. For smaller and quicker projects, you may opt for cordless drills for better portability. In addition, if you’re on a tight schedule, you can trust impact drills to get the job done in no time. However, if precision is a must, stick to your regular drills for better handling.

4. Electric Planer

If you’re looking for a tool that will provide a smooth and seamless finish for your wooden DIY project, then get yourself an electric planer. This hand tool shaves off excess wood and flattens the material allowing it to have a much better form. It is easy to navigate through with its ergonomic handle and adjustable power.

5. Electric Mixer

This electric mixer is the ultimate time and energy saver. Whether you’re mixing paint, cement, plaster, adhesive, grout, or even large amounts of food, you can trust this electric mixer to get the job done, no sweat! It comes with an ergonomic double handle that serves as a steering wheel-like shape for easier control.

6. Electric Blower

Ideal for a quicker clean-up job, this electric blower is a useful tool for deeper cleaning at home and construction areas. This electric tool can blow away dust and unwanted particles from every corner of your home with its dynamic air pressure while handling it conveniently with its easy grip handle.

7. Demolition Hammer

The demolition hammer is specifically designed for faster structure demolition, like concrete walls and tiled flooring. It is a multifunctional power tool for heavy-duty tasks including rilling, hammer drilling, and chiseling. It comes with a durable and long-lasting cellular battery pack structure for longer service life.

8. Electric and Manual Sprayer

These large-capacity sprayers are built with a handy hose and spray nozzle, ideal for keeping your garden space fresh. You can get these handy sprayers in three varieties; electric, manual, and electric-manual–a top-notch everyday tool at home.

9. Safety Helmet

When doing home building and repair, it is essential to wear complete and proper gear to remain safe and avoid unwanted accidents. Prioritize your safety and wear a sturdy helmet to protect your head, neck, and face from injuries caused by falling debris and electrical exposure. Made from high-grade material with an adjustable lock to secure it in place, ensuring better safety in the workplace.

Cut your working time in half and double the efficiency and precision with power tools from Hills, the newest addition to the high-quality house brands at Wilcon Depot. Shop now at any Wilcon store nationwide or shop conveniently at Wilcon Online Store by visiting shop.wilcon.com.ph.

Wilcon Depot has been serving Filipino homeowners and builders nationwide with high-quality home building and improvement needs and excellent customer experience over the years now. Celebrate 45 years of building big ideas with Wilcon Depot and explore their limitless product selections ranging from Tiles, Sanitarywares, Plumbing, Furniture, Home Interior, Building Materials, Hardware, Electrical, Appliances, and other DIY items.

For more information about Wilcon, you can log on to www.wilcon.com.ph or follow their social media accounts on Facebook, Instagram, and Tiktok. Subscribe and connect with them on Viber Community, LinkedIn, and YouTube.

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P&A Grant Thornton holds 23rd Search for Outstanding Accounting Students of the Philippines competition

June 17, 2022 | 8:30 am

SOASP Top 25 Finalists with Panel of Judges and P&A Grant Thornton Partners

Aspiring certified public accountants showcased their knowledge and skills in accounting once more during the 23^rd Search for Outstanding Accounting Students of the Philippines (SOASP), an annual competition which aims to shine the spotlight on the country’s top accountancy students through qualifying examinations and interviews.

The nationwide competition, organized by P&A Foundation Inc., Philippine Institute of Certified Public Accountants (PICPA), and the Association of Certified Public Accountants in Commerce and Industry (ACPACI), was held virtually on May 28, 2022.

Two hundred fifty-four (254) accountancy students, hailing from sixty-eight (68) universities and colleges across the country, and who are candidates for graduation by the end of academic year 2022, went head-to-head in a battle of knowledge, skills, and wits, all with one goal in mind – to be named this year’s SOASP Champion.

Questions and exams were based on different subjects including auditing, management advisory, taxation, and regulatory frameworks for business transactions. An essay exam was conducted as part of the competition.

During the event, participants hurdled a series of exams during the qualifying round, where 25 finalists were chosen to proceed to the next stage of the competition. The Top 25 battled it out during the Quiz Bee round. Only five participants then advanced to the final interview round.

For her solid mastery and application of topics and principles in accounting, Kyra Shane Buhia from the University of San Carlos took home the crown and was named the 2022 SOASP Champion. Tailing closely were Jenzel John Longno, Rica Mae Albiso, Leonelle Lambo, and Filna Quiňo who placed second, third, fourth, and fifth, respectively.

Kyra received a plaque of recognition and P50,000. The Top 25 each received plaques and cash prizes, while the Top 5 were given additional cash prizes as part of their awards.

Present during the competition were Managing Partner and COO and Trustee of P&A Foundation Leonardo D. Cuaresma, Jr., Practice Leader for Business Process Solutions/Outsourcing and Treasurer of P&A Foundation Ma. Paz V. Malubay, Partner for Business Process Solutions/Outsourcing and Chairperson of ACPACI for SOASP Elano C. Marcelo, and Partner for Tax Advisory and Compliance and SOASP Project Head Edward D. Roguel. Meg Punay, Partner and Head of the P&A Davao Office, hosted the auspicious event.

Board of Accountancy Chairman Noe Quiñanola gave an inspirational talk during the event. The panel of judges were P&A Grant Thornton Principal for Tax Advisory and Compliance and Corporate Secretary of P&A Foundation Atty. Lea Roque, National President for ACPACI Teodoro Josephat Martinez, and PICPA Sectoral Director for Education Asser Tamayo.

Former SOASP winners also graced the program, including Vhinson Jay Garcia (17th SOASP 1st Placer) who delivered a short message, and Francis Matthew Obligacion (22nd SOASP 2nd Placer) who led the invocation.

This year’s SOASP competition marked the second time that the event was held virtually since the onset of the COVID-19 pandemic.

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Stagflation not a risk to economy — BSP

June 17, 2022 | 12:34 am

gas-station — A gasoline attendant fills up a motorcycle with gasoline at a gas station in Delpan, Tondo, Manila, June 13. — PHILIPPINE STAR/KRIZ JOHN ROSALES

“STAGFLATION” is unlikely to pose an immediate risk to the Philippine economy, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said.

“The BSP does not view ‘stagflation’ — an economic condition characterized by slow growth, high unemployment, and rising inflation — as an immediate risk to the Philippine economy,” he said in a statement on Thursday.

The central bank is optimistic the Philippine economy’s recovery will be sustained, Mr. Diokno said, citing the 8.3% gross domestic product (GDP) growth in the first quarter.

He noted the steady rise in credit activity, ample domestic liquidity, improved jobs market, and higher foreign direct investments will help boost the economy’s rebound.

Economic managers are targeting a 7-8% GDP growth this year.

However, inflation quickened to 5.4% in May, the highest in three and a half years and above the BSP’s 2-4% target range.

The BSP last month raised its average inflation estimate to 4.6% this year, higher than the previous estimate of 4.3%.

“While domestic inflation is seen to remain elevated in the near term, as a result of supply-side factors linked to volatile global commodity prices, inflation is expected to revert to the government’s target range of 2-4% by 2023. In the meantime, the balance of risks to the inflation outlook now leans toward the upside for both 2022 and 2023,” Mr. Diokno said.

The central bank repeated its support for “urgent and coordinated efforts” of government agencies to ensure there is enough domestic food supply, as well as direct and targeted interventions for vulnerable sectors.

“The BSP will remain vigilant over emerging price and output conditions and will undertake necessary action to ensure that monetary policy settings remain appropriately calibrated, consistent with the BSP’s price and financial stability mandates,” Mr. Diokno said.

The BSP has already signaled another policy rate hike at its June 23 policy meeting.

The Monetary Board kicked off its tightening cycle by raising the policy rate, the yield on the BSP’s overnight reverse repurchase facility, by 25 basis points (bps) to 2.25% during its May 19 meeting to temper rising inflation. Interest rates on the overnight deposit and lending facilities were also hiked to 1.75% and 2.75%, respectively.

This was the first increase in borrowing costs since 2018 and followed cuts worth 200 bps in 2020 as the BSP moved to support the economy amid the coronavirus pandemic.

The World Bank earlier this month warned of the rising risk of stagflation, an economic condition characterized by weak growth and high inflation that was last seen in the 1970s.

“Just over two years after COVID-19 (coronavirus disease 2019) caused the deepest global recession since World War II, the world economy is again in danger,” World Bank Group President David Malpass said in the Global Economic Prospects report released earlier this month.

“This time it is facing high inflation and slow growth at the same time. Even if a global recession is averted, the pain of stagflation could persist for several years — unless major supply increases are set in motion.”

Mr. Malpass noted that global growth will likely be subdued throughout the decade due to weak investment, and there is a risk that inflation will remain higher for longer than anticipated.

The World Bank estimated global growth at 2.1% in 2022 and 1.5% in 2023, reflecting the impact of the pandemic and the Russia-Ukraine war.

The multilateral lender expects the Philippine economy to grow by 5.7% for 2022, and 5.6% on average in 2023 and 2024.

BSP may raise rates by 50 bps next week

June 17, 2022 | 12:33 am

THE UNITED STATES Federal Reserve’s aggressive tightening will put more pressure on the Bangko Sentral ng Pilipinas (BSP) to consider a bigger rate hike at its meeting next week.

The Federal Reserve on Wednesday raised interest rates by 75 basis points (bps), the largest hike since 1994, to curb soaring inflation. Fed Chair Jerome H. Powell also signaled a steep increase in their next meeting.

“Such a more substantial monetary tightening by the US Fed could affect the BSP’s announced stance of gradual normalization of monetary policy,” former BSP Deputy Governor Diwa C. Guinigundo said in a Viber message on Thursday.

The BSP is poised to raise its key interest rate at its next two meetings to address inflation, incoming BSP Governor Felipe M. Medalla said during a virtual roundtable discussion with BusinessWorld editors on Tuesday.

However, Mr. Medalla, a current Monetary Board (MB) member, signaled that the pace of subsequent tightening will be gradual as he ruled out hikes higher than 25 bps.

“While it’s true that signaling such contractionary stance should provide some forward guidance on the BSP’s policy intent and therefore inflation expectation, the size of the Fed’s adjustment could somehow enlarge the expectation by the market of the BSP’s future move,” Mr. Guinigundo said.

Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort said higher Fed rates may lead to further upward adjustments in the local policy rate from the current 2.25%.

“Thus, there is a chance of a local policy rate hike of +0.50 on the next rate-setting meeting on June 23, 2022 and more local policy rate hikes for the rest of the year, partly to maintain a comfortable interest rate differential with the US, to account for the comfortable spreads/interest rate differentials/risk premium — a dilemma faced by many other countries/central banks around the world,” Mr. Ricafort said in a note.

Bank of the Philippine Islands (BPI) in a press release said it now anticipates a 50-bp hike at the next MB meeting.

“We now expect a 50-bp hike from the BSP at its June meeting given the latest move of the Fed. Hiking the policy rate gradually in contrast to what the Fed is doing may exacerbate the headwinds affecting the Philippine economy,” BPI said.

“A very narrow gap between US and local interest rates will likely exert more pressure on the peso, which will eventually translate to more inflation.”

The peso weakened by 3.5 centavos on Thursday as it closed at P53.47 versus the dollar from its P53.435 finish on Wednesday

Incoming Socioeconomic Secretary Arsenio M. Balisacan said the country has to adjust to global policy tightening, and be more mindful of any shocks.

“If interest rates are rising outside of our country, we have to adjust to that because if you don’t, capital will move out of the country,” he said during a roundtable with BusinessWorld editors on Thursday.

“I think we don’t think macroeconomic fundamentals are that bad compared to other countries. We can withstand these shocks. We have to be mindful, always alert, adjusting to the shocks. Failure to do so will be damaging to the economy.”

MORE SELLING?
Meanwhile, the benchmark Philippine Stock Exchange index (PSEi) rose by 73.59 points or 1.16% to close at 6,393.01 on Thursday, recovering from Wednesday’s bloodbath.

Philippine Stock Exchange, Inc. President and Chief Executive Officer Ramon S. Monzon told ANC that the Wednesday’s drop was “in anticipation of what kind of rates the Fed will impose.”

“We’ve been in worse situations and we’ve bounce back to a higher level. I have no doubts what is happening is temporary,” he said.

In a Viber message, AAA Southeast Equities, Inc. President William M. Cabangon said the Fed’s tightening cycle is pulling down global markets, including the PSE.

“I expect selling to continue over the next few months as valuations continue to readjust lower in line with rising interest rates. Although stocks are cheap relative to past earnings, the uncertainty over future earnings due to inflation and slowdown concerns do not make forward-looking valuations very attractive,” Mr. Cabangon said. — with reports from Keisha B. Ta-asan and Luisa Maria Jacinta C. Jocson

Philippine tourism’s share to economy inches up in 2021

June 17, 2022 | 12:32 am

El-Nido — Tourists enjoy kayaking in El Nido, Palawan on April 8. — PHILIPPINE STAR/KRIZ JOHN ROSALES

By Abigail Marie P. Yraola, Researcher

THE SHARE of the tourism industry to the Philippines’ economic output inched up in 2021, as domestic travel restrictions eased alongside the increase in coronavirus disease 2019 (COVID-19) vaccination rates.

Preliminary data compiled by the Philippine Statistics Authority (PSA) showed that tourism’s direct gross value added (TDGVA) accounted for 5.2% of gross domestic product (GDP) in 2021, slightly higher than the revised 20-year low 5.1% of GDP in 2020.

Measuring the tourism-related value created by various industries, the country’s TDGVA was estimated at P1 trillion at current prices, up by 9.2% from the revised P917.20 billion in 2020.

The TDGVA indicator is based on the results of the Philippine Tourism Satellite Accounts report, which the PSA compiles from the Department of Tourism (DoT).

Asian Institute of Management’s Dr. Andrew L. Tan Center for Tourism Associate Director John Paolo R. Rivera attributed the growth in tourism’s contribution to the reopening of tourism activities.

“This is also driven mostly by domestic tourists, who eagerly want to travel after being cooped up in their homes during the lockdowns,” Mr. Rivera said in an e-mail interview.

The government loosened mobility restrictions in the Philippine capital and nearby areas late last year, as COVID-19 infections dropped and the vaccination rate increased. This allowed many hotels, resorts, restaurants and other tourism-related facilities to reopen, albeit at lower capacity last year.

Mr. Rivera said tourism sector’s growth can further improve this year once more foreigners visit the country for tourism.

The Philippines began accepting foreign tourists from visa-free countries in February this year. This was further expanded in April to include vaccinated tourists from all countries in a bid to help in the recovery of the tourism sector and the overall economy.

In a separate e-mail interview, University of Asia and the Pacific Senior Economist Cid L. Terosa said the more relaxed mobility restrictions helped drive the tourism sector’s slightly better performance last year.

“Tourism-related activities that were choked by the pandemic in 2020 started to regain their vim and vigor in 2021,” he said.

Domestic tourism expenditures, which cover spending of resident visitors within the country either as a domestic trip or part of an international trip, surged by a record 38.7% year on year to P782.51 billion in 2021. However, this was still significantly lower than the P3.14 trillion seen in 2019.

Tourism expenditures by non-residents, on the other hand, declined by 79.2% to P27.62 billion from 2020’s P132.59 billion, as foreign tourists were still not allowed to enter the country.

The share of inbound tourism expenditure to total exports dipped to a record low of 0.6% in 2021 versus the 2.9% share in 2020.

Meanwhile, employment in the tourism industries for the year 2021 was estimated at 4.90 million, which is 11.1% of the total employment. This was higher than the 4.68 million employed in the tourism sector in 2020 or 11.9% of the total jobs.

Mr. Terosa believes that the tourism sector will continue to perform better this year, as long as mobility restrictions and alert levels remain at their most lenient.

“Revenge travel or vacation vengeance will continue to gradually gain momentum this year. Inflationary pressures, however, threaten to curb further rise in tourism demand,” he said. “Given the current situation, however, the tourism sector will probably have a clearer chance to exceed pre-pandemic levels in 2023 and 2024.”

Chicken output set to decline as cost of feed rises

June 17, 2022 | 12:31 am

THE PHILIPPINES will likely produce fewer chickens in the coming months with numbers reduced by pricier, lower-quality feed and poor weather, an industry leader said — a slowdown that could drive food costs higher.

Raising poultry will be “very challenging” in the coming months, said United Broiler Raisers’ Association President Elias Jose Inciong, as producers in the Southeast Asian nation compete with the rest of the world for chicken feed, as the war in Ukraine disrupts supplies.

Across Southeast Asia, food costs are rising, hitting domestic supplies and exports. Malaysia recently banned chicken exports due to rising local prices and that hit poultry supplies in neighboring Singapore.

In the Philippines, the cost issue is compounded by high humidity that’s unfavorable to growing chickens, as rainy season came earlier this year. “Normally, the answer to high humidity would be very good nutrition. The problem is it’s now more difficult to get good-quality feeds because of the high cost of raw materials,” Mr. Inciong said in a phone interview on Thursday.

Whole chicken prices in Manila have risen by 25% to P200 ($3.75) since the start of the year, Agriculture department data showed. Meat price increases quickened by 5.4% in May, boosting overall inflation to its fastest since November 2018.

Higher chicken prices could, however, ultimately boost production, Agriculture Assistant Secretary Noel Reyes told The Philippine Star. The Philippines’ total chicken output fell by 3.6% last year to 1.7 million metric tons. — Bloomberg

Alliance Global increases capital spending to P60B

June 17, 2022 | 12:10 am

TAN-LED Alliance Global Group, Inc. (AGI) announced on Thursday that it is hiking its capital spending to P60 billion this year, 33% higher than the previous year as it “strengthens and expands existing businesses to achieve and surpass pre-pandemic levels.”

“We are a conglomerate in motion. We believe that with the sectors we are in, we will very much benefit from pent-up spending resulting from the further reopening of the economy,” AGI Chief Executive Officer Kevin L. Tan said.

Of the total spending, P50 billion will be allocated for real estate arm Megaworld Corp.’s development and investment activities. AGI announced that Megaworld will be launching 14 new projects valued at P30 billion this year.

“The company also intends to launch about four townships during the year, covering some 500 hectares of land in Metro Manila, Calabarzon and Mindanao, which will provide the fresh source of revenue for the company moving forward,” it added.

The balance of the capital expenditure will be distributed to its other businesses, namely: Travellers International Hotel Group, Inc., Emperador, Inc., and Golden Arches Development Corp.

Approximately P4 billion will be designated for Travellers International’s ongoing expansion projects, primarily in leisure and entertainment.

The firm said that its entire Newport City complex is now open to MICE (meetings, incentives, conferences, and exhibitions) activities and its hotels — Marriott Manila, Sheraton Manila, Hilton Manila, and Hotel Okura Manila — are continuing to accept more guests as mobility restrictions ease.

On the other hand, around P3 billion will be set aside for Emperador’s ongoing expansion projects overseas.

“Since the pandemic, Emperador continued to grow from strength to strength, driven by its international operations through Whyte and Mackay for whisky, and Bodegas Fundador for brandy,” AGI said.

The remaining P3 billion will be spent by Golden Arches, which holds the exclusive franchise to operate restaurants in the Philippines under the McDonald’s brand. It is planning to further expand its store network by launching 45 stores this year.

“Our group anchored itself on stability and recovery over the last two years of grappling with the impact of the pandemic. We have since focused on renewal and revitalization — both pointing to our upbeat, more confident view of the future. This shift in mindset would not have been possible without the insights and innovations derived from such challenging times, and the affirmation that our businesses continued to stand on strong ground,” Mr. Tan added.

In the first quarter, AGI reported its net income to owners jumped by 52% to P3.9 billion. Consolidated revenues likewise grew by 18% to P37.5 billion.

At the stock exchange on Thursday, AGI shares dropped by 3.68% or 36 centavos to P9.43. — Luisa Maria Jacinta C. Jocson