Airbnb updates platform, expands search function

May 13, 2022 | 6:18 pm

Airbnb, a home sharing service, rolled out a search function that allows guests to look for places to stay based on their style, location, and proximity to a travel activity, instead of just the destination city.

Announced May 12, Airbnb Categories organizes listings in 56 categories, giving users the option to look for A-frames and castles through the “style” theme; homes on a lake, or near a national park through the “location” theme; or homes near spots for surfing, camping, or skiing through the “activity” theme.

Airbnb’s feature update — “the biggest in a decade,” it said — also includes a one trip, two stays option (Split Stays); and additional travel protection (AirCover).

“The way people travel has changed forever. That’s why we’re introducing the biggest change to Airbnb in a decade,” said Brian Chesky, chief executive officer and co-founder of Airbnb, in a statement.

He added that these changes reflect the longer trips people are now taking, as well as their willingness to be more flexible about where they live and work.

Despite global deterrents such as the Omicron coronavirus variant and inflation, Airbnb’s “nights and experiences” in the first quarter of 2022 exceeded 100 million for the first time, said Amanpreet Bajaj, Airbnb general manager for Southeast Asia, India, Hong Kong, and Taiwan, in an e-mail. (“Nights and experiences” is a metric that measures nights and the number of seats for experiences booked on the platform.)

“This demonstrates strong global demand for travel and the incredible resilience of our business — which enables us to offer the most comprehensive protection in the travel industry, included free in every stay,” said Mr. Bajaj.

LONGER TRIPS

Given that half of the nights booked on Airbnb in the last three months were for trips that lasted a week or more, the home sharing service also introduced Split Stays, which allows guests to divide their time between two different homes.

“The function will take into account the trip’s start and end dates, the distance between listings, and any filters added,” Mr. Bajaj said. The proximity of the homes will depend on the guest’s initial search: a search within a town may yield listings from different neighborhoods, while a search for an entire island may yield listings that are further apart.

Meanwhile, AirCover is free travel protection that encompasses booking protection guarantee (in which guests get a similar or better home in the event a host cancels a booking); check-in guarantee (in which guests get a similar or better home in the event they can’t check into a booked home); get-what-you-booked guarantee (in which guests get a similar or better home if a booked home isn’t as advertised); and a 24-hour safety line (in which guests get access to trained safety agents in case they feel unsafe).

“We’re … giving you the confidence to book knowing that Airbnb’s got your back,” said Mr. Chesky. — Patricia B. Mirasol

SIDEBAR | Amazing views and spacious stays

Based on a wishlist of crowdsourced from both locals and international travelers, Airbnb is anticipating “great interest” in local Airbnb Stays categorized under: Amazing Views, Bed and Breakfasts, Farms, Off-the-Grid, Islands, Lakefronts, and Treehouses.

Among Filipinos, “there is a strong interest in spacious stays that can accommodate large families or groups,” according to Amanpreet Bajaj, Airbnb general manager for Southeast Asia, India, Hong Kong, and Taiwan.

The top summer destinations in the Philippines, ranked by Airbnb searches in the first quarter of 2022 by Philippine guests are:

Angeles, Central Luzon
Subic, Central Luzon
Mabalacat, Central Luzon
Antipolo, Calabarzon
Calatagan, Calabarzon
Cagayan De Oro City, Northern Mindanao
Panglao, Central Visayas
San Juan, Calabarzon
Bacolod, Western Visayas
Silang, Calabarzon

A summer drive with a new Lexus

May 13, 2022 | 5:00 pm

Beat the heat with a long-awaited road trip aboard the Lexus RX or the Lexus IS

The call of the open road is difficult to ignore during the summer season. A trip to the beach, mountains, or other cities with family and loved ones is a great way to rest and rejuvenate the soul. These experiences are priceless, and as such, your mode of transportation should be equally rewarding. Here are two iconic Lexus models that will complement your driving personality.

Choose the Lexus RX, and be treated to Zero % interest for up to 18 months and Free Two Year Periodic Maintenance Service. The RX is the very first luxury crossover SUV to proudly wear the Lexus badge. When it made its debut in 1998, it laid the foundation for what would be a highly successful nameplate. To date, the RX is the most popular model sold by Lexus Philippines. It isn’t surprising, really, considering how the model has evolved, not just in appearance, but in build quality, technology, and practicality.

Choose the Lexus IS, and get Free Two-Year Periodic Maintenance Service. For the driving enthusiast, the Lexus IS sport sedan is the obvious choice for carving through the roads. An exhilarating drive awaits you from behind the wheel. Since the debut of its first-generation IS in 1999, the model has pursued the thrill of driving unique to compact rear-wheel-drive sports sedans. The IS has captured the hearts of over a million enthusiasts around the world, and the number is growing.

With summer in full swing, now is the time to plan that great escape with the Lexus that will fulfill your desires.

The RX 350 (P4,498,000) asserts its presence on a variety of roads and diverse driving conditions. Under its hood is a 3.5-liter V6 direct-injection engine mated to an eight-speed automatic transmission. Keeping things in control is Adaptive Variable Suspension which continually adjusts shock absorber damping rates in realtime. Not only does this inspire driver confidence, but it also keeps the ride buttery smooth–as expected from a Lexus.

The RX 350 F Sport (P5,158,000) shares the same ‘F’ spirit and enhances the sporty driving experience with a few key features. Inside are unique F Sport dials with full-length illuminated needles that add an element of excitement. The cabin is decked out in dimpled leather with an exclusive perforated finish on the steering wheel and shift knob. And then there are the aluminum pedals, exclusive to F Sport models.

The IS 300h (P2,978,000) and IS 300h Premier (P3,328,000) were built in the philosophy of pleasing aesthetic and emotional values to pursue linear operation that is faithful to driver intention. In creating the desired driving sensation, Lexus engineers returned to the basics to evolve a comfortable driving experience.

The IS F Sport (P3,808,000) is fitted with 19-inch multi-spoke wheels in a dark metallic finish that pays homage to the RC and LC models. Keeping in contact with the road underneath are 235/40 R19 tires for the front and 265/35 R19 for the rear. These performance tires offer the necessary grip and stability needed during spirited driving.

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

To arrange a consultation with your personal sales consultant, visit the Lexus Remote page.

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

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‘Revenge travel’ to boost brand sales — ShopBack

May 13, 2022 | 3:16 pm

cojo-rosales-BtCaPpajwBo-unsplash — COCO ROSALES-UNSPLASH

The tourism industry will make a comeback this year as people take advantage of loosened restrictions and go on a “revenge travel” spree, according to ShopBack, a cashback reward program.

“We expect travel to be one of the big [sales drivers],” Prashant Kala, Philippine country head of ShopBack, told BusinessWorld in a May 5 Zoom call. Shopback aims to push P24 billion in sales to its brands in 2022, up from P15 billion last year.

The app will hold a three-day promotion May 16–19, offering up to 100% cashback from travel industry partners such as Agoda, Klook, and Trip.com. It also plans to double the number of companies offering e-vouchers (currently about 20) within the next few months.

Popular domestic destinations in the cashback reward program include Boracay, Palawan, Cebu, Baguio, and Batangas.

Per ShopBack data, domestic travelers tend to be families; international travelers, meanwhile, tend to be couples. Popular international destinations include the US and Singapore.

ShopBack saw spikes in flight and hotel bookings between October and November 2021; and in February, when the Omicron coronavirus variant did little to dampen Holy Week and Labor Day plans.

Public transport stakeholders in the Philippines have been making improvements on infrastructure as early as August 2021 in anticipation of the post-quarantine travel demand.

According to the latest Economic Impact Report of the World Travel and Tourism Council (WTTC), travel and tourism in the Philippines will reach an annual growth rate of 6.7% in the next 10 years, exceeding its overall economy average growth rate of 5.6 %.

The country logged 202,700 foreign tourist arrivals as of April 7, a majority of which come from the United States, Canada, the United Kingdom, South Korea, and Australia. — Patricia B. Mirasol

Udenna open to deals after report owner eyeing asset sales

May 13, 2022 | 2:53 pm

Conglomerate Udenna Corp. is open to exploring potential deals, its president said on Friday, after a report that its tycoon owner was considering selling businesses collectively worth several billion dollars.

Dennis A. Uy, whose business empire expanded rapidly under the country’s outgoing President Rodrigo R. Duterte, is looking at sales of a South China Sea gas field and a commercial land lease firm at the site of a former US military base, sources familiar with the matter told Reuters.

Mr. Uy acquired the Malampaya gas field from Chevron and Shell for roughly $1 billion, while Clark Global City also cost $1 billion, the sources said. The assets are subsidiaries of Udenna Corp.

Asked about the report, Udenna President Raymundo Martin M. Escalona said investor confidence was returning after the pandemic which had hit the profitability of Udenna’s businesses.

“There has been renewed interest in discussing several partnership and strategic alliance opportunities with the group,” Mr. Escalona said, without elaborating.

In the first four years of the Duterte presidency, unlisted Udenna has nearly quadrupled its portfolio to include infrastructure, gaming, shipping, education, construction, fast food, tourism, and sports cars.

It was not immediately clear why Mr. Uy, the top campaign contributor of Duterte in his 2016 presidential run whose term will end next month, would be putting the assets up for sale.

Analysts and bankers say Mr. Uy is under pressure to sell assets to trim debt that was generated by acquisitions.

Shares in two listed Uy firms tumbled on Friday following the report. Telecom operator DITO CME and Chelsea Logistics lost 7.7% and 5%, respectively, while the broader stock index slipped 2.3%.

Not all of Mr. Uy’s companies lost ground on Friday, with shares in oil retailer Phoenix Petroleum trading up 0.4%, while casino-resort developer PH Resorts Group rallied 5%, two days after announcing a capital infusion from a Filipino billionaire. — Reuters

Kids later than sooner: South Korean women freeze eggs as child-rearing costs surge

May 13, 2022 | 2:14 pm

SEOUL — In South Korea, fewer women are having children and those who do are in no rush. The sky-high costs of housing and education make financial security a must. Social mores also dictate the need to be married.

Lim Eun-young, a 34-year-old public servant, says she is not ready to start a family due to the costs and as she only began dating her boyfriend several months ago. But worried that her biological clock is ticking, she had some of her eggs frozen in November.

Ms. Lim was one of about 1,200 unmarried single women who underwent the procedure last year at CHA Medical Center — a number that has doubled over two years. CHA is South Korea’s largest fertility clinic chain with about 30% of the IVF market.

“It’s a big relief and it gives me peace of mind to know that I have healthy eggs frozen right here,” she said.

Freezing eggs to buy reproductive time is an option increasingly explored by women worldwide. But in South Korea, which has the dubious distinction of having one of the world’s lowest fertility rates, the dramatic jump in women using CHA’s services throws into sharp relief the economic burdens and social constraints leading to decisions to delay or even forgo having children.

The fertility rate — the average number of children born to a woman over her reproductive life — in South Korea was just 0.81 last year. That compares with an average rate of 1.59 for OECD countries in 2020.

That’s also despite enormous sums spent by South Korean authorities on subsidies and perks for families with children. The government budgeted 46.7 trillion won ($37 billion) last year to fund policies aimed at tackling the country’s low birth rate.

Much of the blame for South Korean reticence to have children is laid on a highly competitive and expensive education system that makes cram schools and private tutoring a fact of life for most kids from a young age.

“We hear from married couples and watch reality TV shows about how expensive it is to raise kids in terms of education costs and everything, and all these worries translate to fewer marriages and babies,” said Ms. Lim.

Housing costs have also surged. An average apartment in Seoul, for instance, costs an estimated 19 years of South Korea’s median annual household income, up from 11 years in 2017.

Cho So-Young, a 32-year-old nurse at CHA who plans to freeze her eggs this coming July, is also keen to get to a better place financially before having a child.

“If I get married now and give birth, I can’t give my baby the kind of environment I had when I grew up…I want better housing, a better neighborhood and better food to eat,” she said.

But even when finances are less of a consideration, being married is seen as a prerequisite to having children in South Korea. Just 2% of births in South Korea occur out of wedlock compared to an average of 41% for OECD countries.

In fact, while single South Korean women are able to freeze their eggs, they can’t legally proceed with a sperm donation and the implanting of an embryo unless married — an issue thrust into the spotlight by Sayuri Fujita, a Japanese celebrity and single mother based in South Korea who had to go back to Japan for a sperm donation.

That needs to change, argues Jung Jae-hoon, a social welfare studies professor at Seoul Women’s University, noting marriages in South Korea dropped to a record low of 192,500 last year. That’s down around 40% from a decade earlier. Even when looking at marriage levels in 2019 to discount the effect of the pandemic, the decline is still a huge 27%.

“The least the government can do is to not get in the way of those out there who are willing to shoulder the financial burden of having a baby,” he said.

Even more worrying are the statistics showing a sharp drop-off in willingness to have children at all.

Some 52% of South Koreans in their 20s don’t plan to have children when they get married, a massive jump from 29% in 2015, according to a survey conducted in 2020 by the country’s gender and family ministry. ($1 = 1,276 won) — Reuters

With China in focus, Biden makes $150 million commitment to ASEAN leaders

May 13, 2022 | 1:21 pm

WASHINGTON — US President Joseph R. Biden, Jr., opened a gathering of Southeast Asian leaders with a promise to spend $150 million on their infrastructure, security, pandemic preparedness and other efforts aimed at countering the influence of rival China.

On Thursday, Mr. Biden started a two-day summit with the 10-nation Association of Southeast Asian Nations (ASEAN) in Washington with a dinner for the leaders at the White House ahead of talks at the State Department on Friday.

Mr. Biden smiled broadly as he took a group photo on the South Lawn of the White House before the dinner with representatives from Brunei, Indonesia, Cambodia, Singapore, Thailand, Laos, Vietnam, Malaysia, and the Philippines.

While Russia’s invasion of Ukraine is on the agenda, Mr. Biden’s administration hopes the efforts will show the countries that Washington remains focused on the Indo-Pacific and the long-term challenge of China, which it views as the country’s main competitor.

In November alone, China pledged $1.5 billion in development assistance to ASEAN countries over three years to fight COVID and fuel economic recovery.

“We need to step up our game in Southeast Asia,” a senior US administration official told reporters. “We are not asking countries to make a choice between the United States and China. We want to make clear, though, that the United States seeks stronger relationships.”

The new financial commitment includes a $40 million investment in infrastructure intended to help decarbonize the region’s power supply and $60 million in maritime security, as well as some $15 million in health funding to aid in early detection of coronavirus disease 2019 (COVID-19) and other respiratory pandemics, an official said. Additional funding will help the countries develop digital economy and artificial intelligence laws.

The US Coast Guard will also deploy a ship to the region to help local fleets counter what Washington and countries in the region have described as China’s illegal fishing.

Still, the commitments pale in comparison to China’s deep ties and influence.

Mr. Biden is working on more initiatives, including “Build Back Better World” infrastructure investment and an Indo-Pacific Economic Framework (IPEF). But neither are finalized.

The summit marks the first time that ASEAN’s leaders gather as a group at the White House and their first meeting hosted by a US president since 2016.

Eight ASEAN leaders are expected to take part in the talks. Myanmar’s leader was excluded over a coup last year and the Philippines is in transition after an election, though Mr. Biden spoke to the country’s president-elect, Ferdinand Marcos Jr., on Wednesday. The country was represented by its foreign affairs secretary at the White House.

ASEAN leaders also visited Capitol Hill on Thursday for a lunch with congressional leaders.

CONCERN OVER CHINA

The countries share many of Washington’s concerns about China.

China’s assertion of sovereignty over vast swathes of the South China Sea has set it against Vietnam and the Philippines, while Brunei and Malaysia also lay claim to parts.

Yet countries in the region have also been frustrated by a US delay in detailing plans for economic engagement since former President Donald Trump quit a regional trade pact in 2017.

“The US should adopt a more active trade and investment agenda with ASEAN, which will benefit the US economically and strategically,” said Malaysian Prime Minister Ismail Sabri Yaakob on Thursday.

The IPEF is set to be launched on Mr. Biden’s trip to Japan and South Korea next week. But it does not currently offer the expanded market access Asian countries crave, given Mr. Biden’s concern for American jobs.

Analysts say that even though ASEAN countries share US concerns about China, they remain cautious about siding more firmly with Washington, given their predominant economic ties with Beijing and limited US economic incentives.

Kao Kim Hourn, an adviser to Cambodian Prime Minister Hun Sen, told Reuters that the country would not “choose sides” between Washington and Beijing although US investment in his country is growing.

On Wednesday, Hun Sen was the target of a shoe-throwing protester prior to his first visit to the White House over a tenure that began in 1985. The Cambodian leader has faced criticism from activists for suppressing dissent. — Reuters

What are stablecoins, the asset rocking the cryptocurrency market?

May 13, 2022 | 1:10 pm

LONDON — Most cryptocurrencies have a major problem with price volatility, but one sub-category of coins is designed to maintain a constant value: stablecoins.

As cryptocurrency prices plummeted this week, with bitcoin losing around a third of its value in just eight days, stablecoins were supposed to be isolated from the chaos.

But an unexpected collapse in the fourth-largest stablecoin TerraUSD, which broke from its 1:1 dollar peg, has brought the asset class under renewed attention.

Here’s what you need to know:

WHAT ARE STABLECOINS?

Stablecoins are cryptocurrencies designed to be protected from the wild volatility that makes it difficult to use digital assets for payments or as a store of value.

They attempt to maintain a constant exchange rate with fiat currencies, for example through a 1:1 US dollar peg.

HOW IMPORTANT ARE THEY?

Stablecoins have a market cap of around $170 billion, making them a relatively small part of the overall cryptocurrency market, which is currently worth around $1.2 trillion, according to CoinMarketCap data.

But they have surged in popularity in recent years. The largest stablecoin, Tether, has a market cap of around $80 billion, having surged from just $4.1 billion at the start of 2020.

The No.2 stablecoin, USD Coin, has a market cap of $49 billion, according to CoinMarketCap data.

While data on the specific uses of stablecoins is hard to come by, they play a crucial role for cryptocurrency traders, allowing them to hedge against spikes in bitcoin’s price or to store idle cash without transferring it back into fiat currency.

In its biannual financial stability report on Tuesday, the US Federal Reserve warned stablecoins are increasingly used to facilitate leveraged trading in other cryptocurrencies.

From 2018 onwards, stablecoins have increasingly been used in international trade and as a way to avoid capital controls, says Joseph Edwards, head of financial strategy at crypto firm Solrise. The stablecoin Tether in particular is used for trade in and around China and South America, he said.

HOW DO THEY WORK?

There are two main types of stablecoin: those which are backed by reserves comprising assets, such as fiat currency, bonds, commercial paper, or even other crypto tokens, and those which are algorithmic, or “decentralized.”

Major stablecoins such as Tether, USD Coin, and Binance USD are reserve-backed: they say that they hold enough dollar-denominated assets to maintain an exchange rate of 1:1.

The companies say that one of their stablecoins can always be exchanged for one dollar.

Asset-backed stablecoins have come under pressure in recent years to be transparent about what is in their reserves and whether they have sufficient dollars to back up all the digital coins in circulation.

Meanwhile TerraUSD is an algorithmic stablecoin. This means it does not have reserves. Instead, its value was supposed to be maintained by a complex mechanism involving swapping TerraUSD coins with a free-floating cryptocurrency called Luna to control supply.

WHAT CAN GO WRONG?

TerraUSD’s stability mechanism stopped working this week when investors lost faith in Luna, amid a broader downturn in cryptocurrency markets. TerraUSD’s price crashed to as low as 30 cents.

In theory, asset-backed stablecoins should hold firm despite this.

But Tether also broke away from its dollar peg for the first time since 2020 on Thursday, dropping to as low as 95 cents.

Tether sought to reassure investors, saying on its website that holders were still able to redeem their tokens at the 1:1 rate.

WHAT DO REGULATORS SAY?

While regulators globally are trying to establish rules for the cryptocurrency market, some have highlighted stablecoins as a particular risk to financial stability – for example, if too many people tried to cash out their stablecoins at once.

In its stability report, the Fed warned that stablecoins are vulnerable to investor runs because they are backed by assets that can lose value or become illiquid in times of market stress. A run on the stablecoin could therefore spill over into the traditional financial system by creating stress on these underlying assets, it said. — Reuters

Jetmakers’ inflation shield no match for soaring costs

May 13, 2022 | 12:56 pm

DUBLIN — Inflation clauses that determine how much airlines pay for new jets have jumped into a “hyper-escalation” band, pushing up aircraft prices but still leaving manufacturers unable to fully pass on their soaring costs, industry executives told Reuters.

The hike to the top inflationary band is a rare move in the industry, potentially triggering a rise in airfares by airlines while manufacturers will also be left out of pocket, experts warned during major gatherings over the past week in Dublin, the center of the global aviation finance industry.

Airlines buy jets at a basic price agreed in confidential negotiations but the final price includes adjustments for inflation during long production waiting times, based on US factory input and labor costs, wherever the planes are built.

For years, these “escalation” clauses discreetly swelled the profits of planemakers as price revisions exceeded their long-term purchasing costs, people familiar with the contracts say.

Now, with key US cost indices rising by the largest amount in over a decade, the price adjustments are steeper and the cushion between escalation and real costs has vanished.

“It’s always been a windfall game for the (manufacturers) so long as they’re efficient enough to make sure their own costs don’t grow as fast as the escalation,” AerCap Chief Executive Aengus Kelly told the Airline Economics conference.

The rapid spike means some manufacturers may be left out of pocket as the clauses were negotiated during an era when inflation fears were low.

Yet leasing companies who secured limits to their exposure during that decades-long lull in inflation will be in a more comfortable position than some competitors, Mr. Kelly said.

“It’s certainly something that we’re watching carefully… We’re seeing very strong inflation pressures in the United States,” said Steven C. Udvar-Hazy, senior vice-president at Tokyo Century leasing unit Aviation Capital Group.

“The inflationary environment in the United States is of concern to us because that can have knock-on effects on escalation in the broader supply chain,” he told the Airfinance Journal conference.

SHARED RISK

Inflation is a double-edged sword for aircraft leasing companies that own half the world’s fleet.

They benefit from the impact of inflation on the value of aircraft they own. But they must also contend with rising purchase prices, prompting some to insist on escalation caps.

Exact terms depend on the buyer. But in one common type of structure, the lowest escalation band is paid entirely by the airline or leasing buyer and tends to be capped at rates averaging around 3%, sources familiar with the process said.

After that, there may be a second band up to around 5% where manufacturers carry all the additional risk.

When inflation kicks into the highest tier of all, triggering so-called “hyper-escalation” clauses, the two sides typically agree to split the extra burden, they said.

“That is where we are now, in the hyperinflation band, and this is causing a lot of pain for everyone,” a senior industry source told Reuters.

In rare cases, preferred clients may have a get-out clause allowing both sides to walk away from the deal entirely if inflation shoots beyond an extreme level, one source said.

Airbus, Boeing, and Embraer declined comment on contractual matters. All are said to face tough negotiations over price clauses on future airplane deals.

“We don’t see the current high levels of inflation very often but the impact of what is happening is huge. Escalation is going to be a big topic going forward,” Embraer Commercial Aviation Chief Executive Arjan Meijer told Reuters. — Reuters

Tycoon close to outgoing Philippine president mulls sales of big assets — sources

May 13, 2022 | 12:28 pm

malampaya---photo-courtesyfrom-shell — BW FILE PHOTO

A tycoon and close associate of outgoing President Rodrigo R. Duterte is considering selling businesses collectively worth several billion dollars, including a South China Sea gas field and a commercial land lease firm at the site of a former US military base, two sources familiar with the matter said on Thursday.

Dennis A. Uy, chairman of conglomerate Udenna Corp. and listed Chelsea Logistics, has seen rapid growth and diversification of his business empire during the six-year presidency of Mr. Duterte, who leaves office next month.

The assets he is considering selling are the Malampaya gas field, which Mr. Uy had acquired from Chevron and Shell for approximately $1 billion, and Clark Global City, which also cost $1 billion, the sources told Reuters, declining to be identified as they were not authorized to speak to media.

They said buyers had been looking at prospects for some of Mr. Uy’s other businesses, including oil retailer Phoenix Petroleum and his new telecom firm DITO, plus schools and food businesses he operates.

It was not immediately clear why Mr. Uy, the top campaign contributor of Mr. Duterte in his 2016 presidential run, was putting the assets up for sale. His representatives did not immediately respond to requests for comment.

Mr. Uy, 48, is one of the Philippines’ leading entrepreneurs, whose appetite for risk and acquisitions saw him build the bulk of his empire in just a few years.

Udenna Corp. nearly quadrupled its portfolio to more than 100 firms in the first four years of the Duterte presidency, in sectors from gaming, shipping, education and construction to fast food, ferries, tourism, telecoms and sports cars.

The company has long insisted it received no preferential treatment under Mr. Duterte and all businesses and contracts were acquired fairly.

Mr. Duterte will make way for Ferdinand “Bongbong” R. Marcos, Jr., the son of the notorious dictator, who won a presidential election by a landslide on Monday.

ANNOUNCEMENT ‘IMMINENT’

Included in the preferred bidders for deals for Malampaya and Clark Gateway — the developer and landlord of a 177-hectare (437.4-acre) business district near Clark international airport — is billionaire Enrique K. Razon, Jr., one of the sources said.

The transactions have been in the works for “some months already,” the source said, adding “an announcement looks imminent.”

Mr. Razon, Philippines’ third richest man with a net worth of $5.8 billion based on a Forbes ranking, did not immediately respond to a request for comment.

His Bloomberry Resorts announced on Wednesday it had signed a deal to invest in Mr. Uy’s integrated casino-resort projects in Clark and the central province of Cebu.

The Malampaya gas field fuels power plants that deliver about a fifth of the Philippines’ electricity requirements. In December Mr. Uy’s Udenna said Malampaya may operate for several more years beyond its projected 2027 project life.

The proposed assets sales come after the pandemic decimated the profitability of many of Uy’s businesses.

Udenna’s total liabilities rose by nearly half to P254 billion ($4.85 billion) in 2020 from P171 billion in 2019, latest available data from the corporate regulator showed. — Reuters

Protecting against fraud in an increasingly digital world

May 13, 2022 | 9:00 am

A silver lining of the COVID-19 pandemic was that it brought the Philippine financial system to fully embrace digitalization. More banks have begun to acknowledge the benefits that it brings Filipinos across the country: that is, that their customers can now access financial services conveniently, easily, and efficiently through any of their devices.

Yet this newfound way of life comes at the price of increased risk. Alongside the rise of digital financial services during the pandemic, the incidents of fraud and scams have also grown.

According to the Bangko Sentral ng Pilipinas, fraud and scam complaints involving a total of P2 billion worth of financial transactions were reported from 2019 to 2021. Last year alone, the complaints received by the BSP’s consumer assistance mechanism amounted to P540 million in transactions.

This reflects another observation made by the Credit Card Association of the Philippines (CCAP), which found that credit card fraud in the Philippines rose 21% since the coronavirus pandemic, with many incidents involving scammers gaining access to one-time passwords to transact online.

“The industry has been experiencing high volumes of fraud cases causing financial detriment. These perpetrators have carried out fraud by using the various digital payment platforms,” Alex Ilagan, CCAP executive director, said in a statement.

Protecting yourself from frauds and scams

The rapid adoption and evolution of digital technology has made it that much harder for consumers to protect themselves from malicious actors. That is not to say that banks and credit card companies have been slack in their efforts in protecting consumers.

EMV chips in credit cards, for instance, are now a global standard microchip that credit card providers utilize to reduce instances of credit card fraud in the country. Unlike the older technology which used a magnetic strip, the EMV chip generates a unique transaction code every time the card is used for a purchase. Fraudsters that attempt to steal your information through one transaction, such as via skimming, will fail as the transaction data will not be usable beyond the payment it was generated for.

The BSP has also been committed to ensuring that every financial institution it supervises offering electronic payments and financial services must undergo the BSP’s approval process, which requires rigorous security controls and consumer protection mechanisms. Furthermore, the central bank has been developing a circular requiring the adoption of strong fraud management systems and temporary freezes on funds to minimize losses from fraudulent activities.

Yet, while financial institutions have made every effort to secure their channels from cyberattacks, the most common incidents of frauds and scams simply involve trickery and deception to cheat victims out of their money.

“Fraudsters will usually pose as someone they are not. They prey on people’s emotions to manipulate our human tendency to trust. They tell stories that either resonate to our sensitive side or to our desires and aspirations. Then they employ tactics to induce pressure,” the BSP warned.

The central bank added that fraudsters will also sometimes promise the prospect of instant and guaranteed wealth to trick people into revealing sensitive information. ‘Boiler room’ scams are examples.

According to the Philippine National Police (PNP) Anti-Cybercrime Group, the term boiler room refers to an outbound call center selling questionable investments by telephone. It typically refers to a room where salesmen work using unfair, dishonest sales tactics, sometimes selling foreign currency stock, private placements or committing outright stock fraud. To build trust with their victims, fraudsters usually claim that others have already joined or have received the benefits of what they are offering, that they have special expertise or that they are affiliated with a reputable agency.

“The brokers of the boiler room actually ‘create’ a market by attracting buyers, whose demand for the stock drives up the price; this gives the owners of the company enough volume to sell their shares at a profit, a form of pump and dump operation where the original investors profit at the expense of the investors taken in by the boiler room operation,” the PNP explained.

Vigilance remains the best practice to protect oneself, and it should now extend to financial transactions made online or through electronic channels. The CCAP recommends that when shopping online, “look for ‘https’ or a padlock symbol on the leftmost part of the URL bar. This signifies that the website has an SSL Certificate, which guarantees that any sensitive data you send can only be viewed by the intended recipient. SSL Certificates in websites protect any packets of data transferred from its website users via contact forms, buttons, text fields, or any information inputted and submitted into the site.”

“Every time your credit card bill arrives, thoroughly scrutinize your transactions. If you see any errors or unauthorized transactions, contact your bank immediately. The sooner you report these discrepancies bank, the faster you can stop the fraudster from using your credit card,” the organization added.

For suspicious investment schemes, you may contact the Enforcement and Investor Protection Department of the SEC through e-mail at epd@sec.gov.ph or through landline at (02) 8818-6337.

For malicious messages, lodge reports to the NBI Anti-Fraud Division at (02) 8525-4093 or e-mail at afad@nbi.gov.ph. You may also send a message through the NBI’s website at www.nbi.gov.ph or their official Facebook account. You may also report these incidents to the PNP Anti-Crime Group (PNP-ACG) through www.pnpacg.ph or hotline number at (02) 8723-0401 local 5313.

The Department of Finance (DoF) has also opened its online channels for netizens to report any posts, advertisements, and messages containing false information. You may send screenshots of the advertisements and communication from suspected to the DoF Facebook Messenger account: m.me/DOFPH. — Bjorn Biel M. Beltran

Q1 GDP surpasses pre-pandemic level

May 13, 2022 | 12:34 am

PEOPLE cross Roxas Boulevard in Manila, May 1. — PHILIPPINE STAR/ MIGUEL DE GUZMAN

By Abigail Marie P. Yraola, Researcher

THE PHILIPPINE ECONOMY expanded by a better-than-expected 8.3% in the first quarter, surpassing the pre-pandemic output level as household spending surged amid the easing of coronavirus curbs.

Preliminary data released by the Philippine Statistics Authority (PSA) showed gross domestic product (GDP) accelerated by 8.3% year on year in the January to March period, a turnaround from the 3.8% contraction in the same period last year. It was also faster than the revised 7.8% growth in the fourth quarter of 2021.

It also beat the median estimate of 6.7% in a BusinessWorld poll and was within the government’s 7-9% target.

The first-quarter growth was the highest in three quarters or since the 12.1% seen in the second quarter of 2021.

On a seasonally adjusted quarter-on-quarter basis, the country’s GDP went up by 1.9%.

“We have surpassed the pre-pandemic gross domestic product level,” Socioeconomic Planning Secretary Karl Kendrick T. Chua said at a press briefing on Thursday, adding the 8.3% expansion made the Philippines the fastest-growing economy in the East Asia Region in the first quarter.

At constant 2018 prices, the size of the Philippine economy in the first quarter was valued at P4.618 trillion, surpassing the P4.463 trillion in the first three months of 2019.

In current terms, the country’s economic output in the first three months of 2022 amounted to P4.930 trillion, higher than the P4.426 trillion in the first quarter of 2019.

“Growth in the first quarter of 2022 was broad based as most sectors rebounded from their contractions in the same period last year,” Mr. Chua said.

By expenditure share, household consumption grew 10.1% year on year in the first quarter, higher than the 7.5% in the previous quarter and a reversal of the 4.8% decline in the first three months of 2021. This accounted for about three-fourths of the country’s economic output and added 7.5 percentage points to the 8.3% GDP growth in the first quarter.

Government spending on the other hand, eased by 3.6% in the three months to March, lower than the 16.1% in the same period a year ago, due to the election spending ban.

Capital formation, the investment component of the economy, jumped by 20%, reversing the 13.9% decline last year.

Meanwhile, exports of goods and services went up by 10.3%, reversing the 8.4% fall last year. Similarly, imports rose by 15.6%, a turnaround from the 7.5% decline a year ago.

All major industries posted growth in the first quarter with agriculture, forestry and fishing with 0.2% (from -1.3% last year), industry with 10.4% (from -4.2%), and services with 8.6% (from -4%).

Net primary income from the rest of the world more than doubled (103.2%) in the first quarter, a reversal of the 75.9% year-on-year drop in 2021.

Gross national income, the sum of the nation’s GDP and net income received from overseas, climbed by 10.7% during the period, a turnaround from the 10.5% contraction a year ago.

“The Q1 GDP is largely driven by the change in our policy to fully open the economy,” Mr. Chua, who is also director-general of the National Economic and Development Authority (NEDA), said during the briefing.

Metro Manila and other parts of the country were put under the stricter Alert Level 3 in January to contain an Omicron-driven surge in COVID-19 infections. This was downgraded to the most lenient alert level in March that allowed businesses to operate at full capacity.

“There were speed bumps along the way, but our quick rebound from the Omicron surge showed that we have learned to live with the virus and shift from a pandemic to a more endemic mindset,” Finance Secretary Carlos G. Dominguez III said, separately.

Despite the strong first-quarter print, Mr. Chua said there will be no changes to the 7-9% full-year target.

“Our strong economic performance moves us closer to achieving our growth target of 7-9% this year, but we will not rest on our laurels. We will continuously work hard to strengthen our domestic economy against heightened external risks such as the Russia-Ukraine conflict, China’s slowdown, and monetary normalization in the United States,” Mr. Chua said.

CONSUMPTION
“The strength in consumption and investments was particularly palpable, given that there were renewed social restrictions in early 2022 to contain the sharp rise in COVID-19 cases,” ANZ Research said in a research note.

ANZ Research said the growth was also boosted by the strong recovery in the labor market, improving remittances, and the reopening of the international borders.

Security Bank Corp. Chief Economist Robert Dan J. Roces said the further easing of lockdown restrictions allowed economic activities to resume. Barring any fresh spikes in new cases, he expects the most lenient alert level to continue over the next quarters.

“Inflation is a headwind to growth, with oil and food prices in elevated levels this second quarter; surging inflation and robust growth print gives the (BSP) some elbow room to hike rates as early as the May 19 meeting,” Mr. Roces said in an e-mail.

Alex Holmes, an economist at Capital Economics, said the country should have gained further momentum in recent months but suspects that the strength of this recovery will begin to wane soon.

“However, while day-to-day disruption from COVID-19 is largely in the rear-view mirror, new headwinds are building. A jump in prices is eating into consumers’ real purchasing power. High global oil prices due to the war in Ukraine are feeding through to pump prices,” he said in a research note.

As the boost from reopening fades and headwinds to consumption bite, Mr. Holmes said the Philippines’ recovery will likely slow.

Despite the high year-on-year growth figures, Mr. Holmes said the country’s economic recovery “is, and will remain, very weak.”

“That is a key reason to expect the central bank to normalize policy only very gradually,” he said.

Bank of the Philippine Islands Lead Economist Emilio S. Neri, Jr. said the latest GDP print provides the Bangko Sentral ng Pilipinas (BSP) more space to hike interest rates.

“With inflation becoming a significant threat to the recovery, even a mild monetary policy tightening can help temper price increases,” he said in a press release.

All eyes will be on the central bank as the Monetary Board meets on May 19 to review its policy settings.

Upbeat Q1 growth builds case for BSP rate hike by next week

May 13, 2022 | 12:33 am

THE PHILIPPINE central bank on Thursday welcomed the faster-than-expected economic growth in the first quarter, with some analysts saying this helps build the case for a rate hike as early as next week.

Gross domestic product (GDP) expanded by 8.3% in the January to March period, marking the fourth straight quarter of expansion. The latest print beat the 6.7% median estimate in a BusinessWorld poll.

“[It] beats our own growth expectation. [We] will consider this positive development together with the improving jobs market in our policy meeting next week,” Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said in a Viber message to BusinessWorld.

The Monetary Board will have its next policy meeting on May 19.

Mr. Diokno said in late April that they may consider a rate hike in June, but will first ensure that economic recovery is more entrenched.

“For our part, the BSP stands ready to adjust our monetary policy settings, should we see material risk of these supply-side pressures spilling over to the demand side,” he told reporters in a Viber message.

Headline inflation accelerated to a three-year high of 4.9% in April due to soaring food and energy prices. This is already above the 2-4% target range set by the central bank.

The central bank expects inflation to hit 4.3% this year. If realized, this would mark the second straight year of beyond target inflation after the 4.5% in 2021.

ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa said the latest economic data comes at a time when the central bank is also facing concerns over rising prices with inflation already beyond target.

“BSP Governor Diokno has been keeping rates unchanged to help support the economic recovery. But with GDP now back to pre-COVID-19 levels and with inflation accelerating, we fully expect BSP to hike policy rates at the May 19 meeting next week,” Mr. Mapa said in a note.

Amid improving growth, economic managers still have to face one of the fastest inflation rates in the Asia-Pacific region, said Sonia Zhu, an analyst at Moody’s Analytics.

“A June rate hike is highly likely as broad-based growth is taking hold. However, with BSP under increasing pressure to arrest rising inflation pressures, we would not be surprised by a rate hike in May,” Ms. Zhu said in a note.

As the Philippines grapples with rising inflation, Fitch Ratings said it expects the BSP to start increasing interest rates in the second half of the year.

The BSP has maintained interest rates at a record low since November 2020 to support the Philippine economy’s recovery from the pandemic.

A rate hike would be the first since 2018, when the central bank increased rates by 175 bps to curb inflation. — Luz Wendy T. Noble

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