Ayala Corp grooms next generation of leaders

July 5, 2021 | 12:43 pm

As the Philippines’ oldest conglomerate gets bigger and more diversified, the family behind the empire knows it’s inevitable that outside talent would be needed to bring the company and its vast holdings to greater heights.

The diverse interests of Ayala Corp. — banking, property, energy and telecommunications to name a few — mean that it’s unlikely that “one single gene pool” could have all the skills needed to run various businesses, said Mariana Zobel de Ayala, a member of the founding family who has worked at various units. Her father, Jaime Augusto Zobel de Ayala, is the company’s chairman and was chief executive officer until he handed the reins to his brother Fernando in April.

Under Jaime and Fernando’s stewardship in the past quarter of a century, Ayala has increasingly counted on non-family executives to run its businesses. Grooming the family’s next generation of leaders — the eighth since the company started in 1834 — means giving the cohort the opportunity to pursue their personal interests and develop skills, all while they are observed to see if they fit Ayala’s larger leadership needs.

“As a family, we’re generally all in agreement that it would probably be statistically unlikely for one single gene pool to be able to cover all the skills needed for such a diverse set of businesses,” Mariana said in an interview with Bloomberg Television’s David Ingles. “We understand that we’re really here to find the best people for the job at hand; that doesn’t necessarily have to be family.”

The reliance on non-family executives to run Ayala’s key businesses will not be reversed even as the next generation gets “deliberate exposure,” Mariana said.

Just like in her father and uncle’s generation, Mariana and her contemporaries who are keen in the family business are encouraged to work at the group’s various units to understand how the ventures are run, how each operation fits in the conglomerate’s objectives, and how the assets can leverage each other.

Mariana is currently deputy head of marketing at Bank of the Philippine Islands, the nation’s oldest lender. She was previously with Ayala Land Inc. as general manager overseeing its malls operations.

Her brother Jaime Alfonso is head of business development at Ayala, while a cousin, Jaime Urquijo Zobel de Ayala, is involved in an oil and gas exploration unit.

Ayala under Jamie Augusto had sought to make itself more relevant to Philippine society as it diversified and revamped existing businesses. It offered homes targeted to different income groups, broadened banking services beyond wealthy individuals and the middle class, and ventured into health care and education.

Understanding Filipino consumers is key for Ayala’s businesses to succeed, Mariana said. Her studies of social sciences at Harvard and business administration at INSEAD, as well as investment banking experience while at JP Morgan, is helping her navigate the dynamics of Ayala and its Filipino consumers.

The pandemic has accelerated the shift to digital technology, which has opened up new markets.

“The transition is a little more challenging but exciting,” she said as the group continues to focus on its core businesses. To build opportunities 20 years ahead, the nation’s oldest conglomerate must “have an understanding of the consumer across those different touch points in a way that is integrated and in a way that we can personalize our services,” she said. — Bloomberg

[B-SIDE Podcast] Play-to-earn: the rise of NFT gaming

July 5, 2021 | 10:09 am

The “play-to-earn” movement is an emerging phenomenon in gaming, wherein players collect rewards in the form of NFTs (non-fungible tokens) within a game and later convert them to real cash. Guilds have also cropped up to invest in in-game assets, loan these out to a player community, and educate others who may want to join in.

In this B-Side episode, Yield Guild Games (YGG) co-founder Beryl C. Li tells BusinessWorld reporter Brontë H. Lacsamana how play-to-earn works, the economics behind it, and how NFT gaming got a boost over the pandemic.

TAKEAWAYS

Certain items or rewards in a blockchain-based game can have real-world value.

Non-fungible tokens (NFTs) are digital properties that can take many forms, from memes and animated GIFs to in-game assets. Using blockchain, an NFT’s record of ownership is stored in a digital ledger, so that players — and not game developers — own their in-game collectibles. This means NFT items in blockchain-based games can be moved off the platform and sold or traded in any open market.

“These are unique assets that are actually produced on the blockchain itself,” said Ms. Li. Her main example were the cute, Pokemon-inspired creatures in the game Axie Infinity: “You can use three of these ‘battle Axies’ to earn rewards in the Axie game itself.”

Axie Infinity, a popular NFT game in the Philippines today, is only one of many games emerging to meet the demands of an unemployed or underemployed player base.

The unemployment rate continues to fluctuate amidst the pandemic, boosting the need for play-to-earn games like Axie Infinity. Its Vietnamese developer, Sky Mavis, reported that 29,000 of the 70,000 downloads of the game in April this year came from the Philippines.

“(YGG) supports a number of games right now. Axie Infinity is one of them. We acquire various (assets in-game) and we lend them to our community of members in the form of a scholarship program,” said Ms. Li, “Our members are able to play with these NFTs and they earn yield, which can be converted to Philippine pesos. And they can use it to put food on the table and buy milk for their kids.”

A scholar is able to earn $800 a month, which Ms. Li pointed out is more than the minimum wage.

The ‘play-to-earn’ phenomenon and the digital economy it’s building is here to stay.

Players who use NFTs to earn in-game rewards in the form of cryptocurrencies are part of the “play-to-earn” movement. Being part of a guild means they can apply for scholarships and access many of the games and their profitable assets.

“Because there’s a lot of demand, the supply needs to be able to match that particular demand. YGG would like to support other developers’ games as well to really build around the play-to-earn concept and phenomenon,” added Ms. Li.

Players gain financial literacy as they get familiar with cryptocurrency through the games.

With the fluctuating rate of unemployment getting many into NFT games, there’s also the possibility of these people getting into cryptocurrency through the games as well.

“It’s a very good way to really learn — so as an example, we have players that were able to earn rewards and convert them into buying a house,” explained Ms. Li, “They’re able to make decisions (on) what to do with their rewards.”

As of July 1, YGG has reported over 2,000 scholars from all over the world, including the Philippines, Indonesia, and Brazil, among others. They’ve earned around 19 million in-game tokens known as Small Love Potions, equivalent to around $2.5 million.

Marketplaces can cater to those who want to loan out their in-game assets instead of grind and play themselves.

Whether it’s through battle Axies, a piece of land, or rare weapons, options have arisen for those who want to earn without playing. “Some of our other players actually end up creating their own yield farms as well, where they actually start breeding their assets and loaning them out to other community members,” said Ms. Li.

In addition to holding quests for guild members end of July, YGG will be launching its own marketplace in the future, for those who want to be entrepreneurs within the community.

“We do not only serve players themselves but it could actually be those who think like investors, who would like to own these gaming assets,” she added. It would be a matter of matching these investors with those who want to play but don’t own enough assets.

The play-to-earn movement is a cross between gaming and decentralized finance, which can reach lower segments of the economy.

The concept of yield farming comes from decentralized finance, a branch of cryptocurrency which was Ms. Li’s background before YGG. Known as the practice of lending crypto assets to generate high returns of additional cryptocurrency, it was a natural marriage of that world with NFT gaming, according to the co-founder.

After reading a Coindesk article which was the first instance documenting the rise of play-to-earn in Cabanatuan City, Philippines, Ms. Li and her two friends, Gabriel “Gabby” Dizon and another who goes by the pseudonym Owl of Moistness, saw potential.

“It would be really interesting to see blockchain games have this play-to-earn kind of economics because, that way, they could actually involve more people in the community who need to make a living the most,” she said.

This B-Side episode was recorded remotely on June 25. Produced by Paolo L. Lopez and Sam L. Marcelo.

Stunning Tile Designs to Spruce Up Your Kitchen

July 5, 2021 | 9:31 am

Tiles are one of the most vital elements in keeping your kitchen interior looking fresh and exciting. As kitchen lovers, you must not forget to have the perfect eye-catching tile pieces that can transform your space. Whether you want to have a classic minimalist to elegantly exquisite look, you need to design your space and make it comfortable and pleasing to help you feel inspired while doing your kitchen tasks. You can start to personalize your working kitchen space into a stylish and sophisticated design with these tile design ideas that would surely match your kitchen interiors.

Chic Industrial Statement

When you want to make a chic, industrial-looking space complementing your urban vibes, Herberia Be Unique tiles are a great choice to give your kitchen a more modern finish. These Be Unique glossy ceramic tile pieces can create a balance of pastel colors that contrasts your entire space. The beauty of this tile lies ironically in its simplistic, refined look. When you choose to have this Herberia Be Unique Salvia Satinato installed in your kitchen, your interiors can be a trendsetter for a striking and chic industrial statement in your space.

SHOP: Herberia Be Unique Salvia Satinato

Classic Glam Look

When you want to express your personality and attract much-deserved admiration and awe from your families and guests, this classic and naturally-toned Herberia Be Unique Cipria Lucido kitchen wall tiles is the way to go. You can achieve a less formal classical style and create pure white surfaces yet a very glamorous look in your kitchen. For a fabulous kitchen makeover, add a bit of harmony and depth of brightness from the minimalistic look of this Herberia Be Unique tile series.

Metallic Trend Design

When you want your kitchen tiles to look more than usual, go with the metallic trend design option. Picasso Mosaic Peel & Stick Mosaic Tiles Serin Silver is a trendy metallic tile and a stylish and elegant choice for your kitchen space to create a sparkly mosaic backsplash. This Peel & Stick tile can make your kitchen exquisite with its easy installation. You simply need to peel off the protective layer from the adhesive side and stick it onto your kitchen wall for an eye-catching design for your space. Its hexagonal shape creates a stand-out design and will help your kitchen appear a whole lot brighter too.

SHOP: Picasso Mosaic Peel & Stick Mosaic Tiles Serin Silver

Rustic Timeless Effect

You don’t have to stick to ordinary-looking tiles for your kitchen when you can make more impactful surfaces with Rocersa Livermore Tetris Noce tiles. This ceramic, matte-finished tile boasts striking monochrome line patterns that can give your kitchen a rustic, timeless effect. Its contrasting stripes also make an on-trend ombre effect that can indeed impart an extra decorative dimension and neutral warm touch for your favorite place at home.

Sparkling Embossed Accents

For a little shinier and unique kitchen backsplash, you don’t have to look any further but choose Emigres backsplash tiles. Maintain a visually appealing space and at the same time protect your kitchen walls with Emigres Linus Velvet Cobre. This tile goes perfectly and stands out from your plain walls. Its embossed, glossy feature adds so much personality, which is dynamic, playful, and full of texture, and creates a warm and inviting impact in your space.

You can start making big statements in your kitchen interiors and pick the best tile design ideas perfectly suitable for your kitchen from Wilcon Depot. Your favorite and well-loved home improvement retailer offers expansive tile selections that speak of quality, elegance, and design and create a taste of exceptional style for your kitchen interiors.

Explore the limitless premium quality of Italian tile brands such as Novabell, Energie Ker, Gardenia, Imola, Herberia, Opera, Castelvetro, Keradom, Naxos, Dom, and Versace alongside with Spanish tile brands Alcalagres, Grespania, Rocersa, Cifre, Emigres, Keros, Tesany, Onix, Oset, Vitacer, Grupo Halcon, Myr, Eco Ceramica, and Etiles. Asian tile brands are also available like Arte, Sol, Lola, Huanqiu, Verona, Picasso Mosaic, Roman, Mulia, Kia, China Natural Granite, Basel, Saigres, and Gemma.

To ensure a safe and convenient shopping environment in all Wilcon stores, the company continuously implements safety protocols for the health and well-being of both employees and valued customers.

You can also shop through your Personal Shopper with the Browse, Call, and Collect/Deliver service. For the list of participating stores with their pick-up and delivery contact details, click this link: www.wilcon.com.ph/content/328-bcc-branches.

Another shopping alternative is the Wilcon Virtual Tour. An online shopping option wherein customers can contact the nearest Wilcon store via Facebook Messenger App. Customers can contact the nearest stores, and the Wilcon team will take you on a virtual tour where you can explore the available products inside their physical stores.

Wilcon also provides contactless payment options to its customers like bank transfers, GCash, PayMaya, InstaPay, PesoNet, WeChat, and Alipay for customers’ convenience.

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

Fruitas Holdings, Inc. sets stockholder’s meeting via remote communication

July 5, 2021 | 9:09 am

Inflation likely eased, still above goal

July 5, 2021 | 12:34 am

face-mask-Public Market — PHILIPPINE STAR/ MICHAEL VARCAS

By Luz Wendy T. Noble, Reporter

INFLATION IN JUNE likely breached the Philippine central bank’s target for the sixth straight month, though slower due to improving food supply and falling transport prices, analysts said.

Consumer prices rose by 4.3%, according to a median estimate of 14 analysts polled by BusinessWorld last week, matching the midpoint of the 3.9% to 4.7% estimate by the Bangko Sentral ng Pilipinas (BSP).

That is faster than the 2.5% inflation a year earlier and the central bank’s 2-4% target for the year, but slower than 4.5% in May, largely due to lower food prices, analysts said.

The Philippine Statistics Authority will report the June consumer price index data on July 6.

“The temporary reduction in tariff rates for pork and rice would have resulted already to some gradual reduction in local meat prices,” Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp. said in an e-mail.

Food prices have risen in the past months because of tight supply in pork products amid an African Swine Fever outbreak. The government in May raised the minimum access volume and cut tariff rates for pork imports for a year.

The government also reduced tariff rates for rice for the next 12 months to keep prices affordable and increase supply.

Better weather conditions last month had likely kept fruit and vegetable prices stable, Nicholas Antonio T. Mapa, a senior economist at ING Bank N.V. Manila said in an e-mailed reply to questions.

Transport inflation could have slowed due to base effects from higher tricycle fares last year, he added.

Rising oil prices are a major risk to inflation, Robert Dan J. Roces, chief economist at Security Bank Corp. said in an e-mail.

Electricity rates also went up amid tight supply and increased demand from businesses that reopened amid a coronavirus pandemic, he added.

Gasoline, diesel and kerosene prices have increased by P10.75, P9.25, and P7.70 per liter, respectively as of June 22, according to data from the Energy department.

Manila Electric Co. has said electricity rates last month increased by P0.0798 per kilowatt-hour (kWh) to P8.6718 from P8.5920 in May.

Anemic domestic demand could have led to slower inflation last month despite higher oil and electricity prices, Ruben Carlo O. Asuncion, chief economist at UnionBank of the Philippines said in an e-mail.

The central bank on June 24 raised its inflation forecast for the year to 4% from 3.9%, saying it had factored in the impact of higher global oil prices and a more favorable global growth outlook. Inflation in the five months through May was 4.4%.

It kept the key policy rate unchanged at a record low of 2% as it vowed to continue supporting an economy threatened by the coronavirus. The overnight deposit and lending facilities were also kept at 1.5% and 2.5%, respectively.

‘BREATHING ROOM’
Easing inflation even if it’s still beyond the target would allow the central bank to keep an accommodative policy it had promised to support economic recovery, said Alvin Joseph A. Arogo, research head at the Philippine National Bank.

“A slower inflation in June, even if still above 4%, could give confidence to the BSP that peak inflation is behind us,” he said in an e-mailed reply to questions. “This would allow for more breathing room for the central bank to remain accommodative amid declining loans and the slow gross domestic product recovery,” he added.

BSP Governor Benjamin E. Diokno has said the central bank would keep an accommodative policy stance “for as long as necessary” and would only consider changes when recovery becomes more sustainable, likely in the second half of next year.

The economy shrank by 4.2% in the first quarter after a record 9.6% contraction in 2020. The government expects the economy to grow by 6% to 7% this year.

Various multilateral lenders and think tanks have lowered their growth forecasts for the country due to lockdowns amid a fresh surge in coronavirus infections.

Bank lending, which boosts trade and commerce, has been declining since December despite record low interest rates. Loans fell by 4.5% in May — the sixth straight month of decline — after dipping by 5% in April.

The central bank has cited the need to keep an accommodative policy given tepid credit activity. But it may pull a surprise increase if elevated inflation persists, said Emilio S. Neri, Jr., lead economist at Bank of the Philippine Islands.

The dollar could rise against the peso too rapidly in the next two months if inflation remains elevated and as second-quarter economic growth exceeds market expectations, he said in a Viber message. “We believe the next Monetary Board decision could tilt towards a mild, preemptive hike.”

The peso closed at the P49-a-dollar level on Thursday and continued to weaken to P49.20 on Friday, its weakest close in nearly a year, based on data from the Bankers Association of the Philippines.

Analysts traced the weaker peso to strong dollar demand as the economy reopens and due to cautious sentiment amid coronavirus concerns.

The policy-making Monetary Board will meet on Aug. 12 to decide on key rates and will have three more meetings this year after that.

Philippines maintains lower-middle-income status amid pandemic

July 5, 2021 | 12:33 am

THE PHILIPPINES remained a lower-middle-income economy after a coronavirus pandemic pulled the economy down last year, according to the World Bank.

The country’s gross national income (GNI) per capita went down by 11% to $3,430 last year from $3,850 a year earlier, based on updated data posted on the multilateral lender’s website

This fell within the lender’s income bracket for lower-middle-income economies of $1,046 to $4,095 GNI per capita, which was raised from $1,036-$4,045 last year to account for inflation.

The World Bank also increased its income range for the upper-middle-income bracket to a GNI capital of $4,096-$12,695 from $4,046-$12,535.

The Philippines targets to graduate to the upper-middle-income status by 2022. It is also seeking to get an “A” long-term credit rating next year, when it loses access to concessional loans.

The government was still on track to be within the higher income bracket by the second half of next year, Socioeconomic Planning Secretary Karl Kendrick T. Chua said in a Viber message on Sunday.

The economy’s record 9.6% drop in economic output last year led to a lower GNI per capita income, he said. His office estimates that the country lost P2 trillion in potential economic output last year amid coronavirus lockdowns.

The Philippines joined 54 other countries in the lower-middle-income category, which includes India, Indonesia, Laos, Myanmar, Timor-Leste and Vietnam.

The World Bank said other economies still managed to climb higher in the income classifications despite the pandemic, such as Moldova, which is now an upper-middle-income economy with a GNI per capita of $4,570.

Countries that graduated to the lower-middle-income status from being low-income economies were: Haiti, whose GNI per capita rose to $1,250, and Tajikistan with a $1,060 GNI per capita.

Economies that moved to a lower category were Belize, Indonesia, Iran, Mauritius, Panama, Romania and Samoa.

Philippine GNI — the sum of its economic output and net income received from overseas — dropped by 11.4% in 2020, a complete turnaround from the 5.4% growth in 2019.

For the first quarter, its GNI fell by 10.9%, sharper than the 1.6% slump a year earlier. — Beatrice M. Laforga

Five-month borrowings rise during health crisis

July 5, 2021 | 12:32 am

GOVERNMENT BORROWINGS rose in the five months to May from a year earlier amid a rising budget deficit, according to Treasury bureau data.

Gross borrowings rose by 17% to P1.766 trillion, but the Department of Finance (DoF) said the country’s debt ratios remained manageable.

For May, the government borrowed P112.189 billion, 61% lower than a year earlier and 59% less than in April.

The government borrows from both local and foreign lenders to finance its budget gap that is expected to widen to 9.3% of economic output this year. The deficit hit P566.2 billion in May.

About 93.1% of the debt in May came from local sources. The rest came from overseas.

Domestic borrowings hit P104.4 billion that month, 38.77% lower than a year earlier and less than P106.15 billion in April.

These were made up of P95 billion in Treasury bonds and P9.4 billion in Treasury bills that the Treasury bureau had auctioned off weekly.

Minus the P793-million debt repayments made, net borrowings stood at P103.61 billion in May, down by 39% year on year.

Meanwhile, new foreign debt fell by 93.5% to P7.79 billion in May from a year earlier, and 95% lower month on month.

“The recent build-up in external debt was driven by the government’s resource mobilization against the COVID-19 pandemic,” the Finance department said in an economic bulletin e-mailed on Sunday.

The agency said the Philippines’ external debt-to-gross domestic product ratio was the lowest among the five original members of the Association of Southeast Asian Nations last year, after Thailand (37.9%), Vietnam (38.5%), Indonesia (39.4%), and Malaysia (67.7%).

The Treasury bureau got P7.789 billion in new project loans that month and settled P8.074 billion of its debt. This resulted in a net redemption worth P285 million.

Year to date, the government’s new debt made up 59% of the P3-trillion programmed borrowings for the entire year. The P1.766-trillion borrowings consisted of 85% in local debts and the rest were from external sources.

Gross domestic borrowings rose by 31% to P1.513 trillion in the five months to May from a year earlier.

These were made up of P540 billion in short-term borrowings from the Philippine central bank, P462 billion in retail Treasury and so-called “Premyo bonds,” P389 billion in T-bonds and P120.31 billion in T-bills.

Gross external borrowings in those five months fell by 29% to P253.04 billion from a year earlier.

About P122 billion was raised through euro-denominated bonds issued in April and P24.19 billion in Samurai bonds sold in late March. The Treasury bureau also borrowed P72.12 billion in program loans and P34.76 billion in project loans.

Less all the repayments made by the government during the period, the government’s net borrowings increased by 16% to P1.56 trillion in those months from a year earlier.

The country’s outstanding external debt had reached $97.05 billion as of March, slightly lower than $98.49 billion at the end of 2020, according to a separate report from the central bank.

The DoF said this accounted for 26.7% of economic output or less than half of the country’s 57.3% debt ratio in 2005, the benchmark year of the International Monetary Fund for its balance of payments manual.

The government started increasing its borrowings last year as many parts of the country were locked down amid a coronavirus pandemic.

The sluggish economy forced the state to borrow more to fund relief programs for hard-hit sectors and make up for the plunging tax collections. — Beatrice M. Laforga

PSE to continue delisting suspended companies

July 5, 2021 | 12:31 am

THE PHILIPPINE Stock Exchange (PSE) will continue delisting companies that have been suspended and have not been trading for some time.

The bourse’s Issuer Regulation Division would clean up the list in the next few weeks, PSE President Ramon S. Monzon told an online news briefing on Friday.

“That’s one of her assignments from me — clean up all these listed companies that are not [trading], that have been suspended for a long time,” he said referring to Marigel Baniqued-Garcia, the division’s new head.

The division will complete due-process requirements before coming up with decisions.

Companies that have failed to file annual reports on time and correct negative stockholder equity in the past three years may be involuntarily delisted, Mr. Monzon said.

Companies that applied for voluntary delisting and have not traded for a time may also get stricken off the list. The PSE is planning to add a time-bound rule to cover this in the future, he said.

“If a company fails to trade for three or five years, it cannot be listed,” Mr. Monzon said in mixed English and Filipino.

In June, the exchange issued memos on the involuntary delisting of Export and Industry Bank, Inc. and Primetown Property Group, Inc.

It said the country has few listed companies at 270, only 80 to 90 of which are trading.

“I’d rather have 90 listed companies that are trading,” which looks better, Mr. Monzon said.

A company that gets delisted from the exchange must buy back shares from investors in a process called a tender offer.

The PSE in December tightened voluntary delisting rules by giving shareholders a say in any company delisting. It also required the tender offer price to consider the stock’s volume-weighted average price a year before the plan.

This was after complaints from minority shareholders who were dissatisfied with the tender offer price given by companies that have delisted from the stock exchange in recent years.

Under the new rules, a company must make sure that votes against the delisting plan do not exceed 10% of a company’s total outstanding and listed shares. Before, only the approval of a listed company’s board was needed to delist. — Keren Concepcion G. Valmonte

Megawide keen on more projects with LGUs

July 5, 2021 | 12:06 am

By Arjay L. Balinbin, Senior Reporter

MEGAWIDE Construction Corp. is focusing on local government projects and the Duterte administration’s Build, Build, Build initiative, the company’s chief executive said.

“Right now, ang mga clear na project na bini-bid out ay ‘yung mga Build, Build, Build. Doon na lang kami nag-focus muna (Right now, projects with clear direction are those under Build, Build, Build. We are focusing on those projects for now),” Megawide Chairman and Chief Executive Officer Edgar B. Saavedra told BusinessWorld in an online interview on June 29, when asked if the company is still interested in rehabilitating the Ninoy Aquino International Airport (NAIA).

He said the company remains interested in the NAIA project, but the government must provide “clear direction.”

“Hintayin na lang natin ‘yung next administration kung ano ‘yung direction (Let us just wait for the next administration and see what direction it will take),” he added.

After the Manila International Airport Authority board rejected Megawide and its foreign partner GMR Infrastructure Ltd.’s appeal in January to overturn the revocation of its original proponent status for the NAIA rehabilitation project, the company shifted its focus to local government unit (LGU) projects.

“At least, doon mas mabilis ang decision making (At the LGU level, decision making is faster),” Mr. Saavedra noted.

The company is currently working on the redevelopment of the Cebu Carbon Market.

“Construction is ongoing, and we will open the first phase in the fourth quarter of the year,” Megawide Chief Corporate Affairs and Branding Officer Louie B. Ferrer said.

“We are talking to other LGUs also because we have experience in the transport industry,” he added.

He said renewable energy company Citicore Power, Inc., an affiliate of Megawide, is also working with different LGUs for its projects.

Despite losing the original proponent status for the NAIA project, Megawide is grateful to the current administration for the “chance to build another important airport,” Mr. Ferrer also said, referring to the Clark international airport’s new passenger terminal.

Luzon International Premier Airport Development, which operates the Clark airport, is set to open this month the new terminal building for domestic commercial flights. The building can hold eight million passengers annually.

“We thank them also for upgrading some standards at the original airports because the operation efficiency at other airports can affect our operations at Mactan-Cebu International Airport,” Mr. Ferrer added.

He also said Megawide is hoping that the next administration will still prioritize airport projects.

The company announced last week that it intends to participate in three to four contract packages of the Metro Manila Subway project and another three to four contract packages of the North-South Commuter Rail-South Line project.

Regulators boost SEC role in accrediting auditors

July 5, 2021 | 12:05 am

REGULATORS inked a deal that puts the Securities and Exchange Commission (SEC) as head of the accreditation and selection process for external auditors in a bid towards greater ease of doing business, the central bank said in a statement on Saturday.

The Financial Sector Forum (FSF), which includes the SEC, the Bangko Sentral ng Pilipinas (BSP), Insurance Commission (IC), and the Philippine Deposit insurance Corp., signed a multilateral memorandum of agreement with the Professional Regulatory Board of Accountancy to promote ease of doing business and compliance to international standards of auditing.

Under the framework, external auditors will only need to file for their applications with SEC. Other member agencies of the FSF can tap on the existing information-sharing platform to complete the evaluation and accreditation or selection process for external auditors.

“All applications received under the new framework were processed and approved within the 20-day processing time as required under the Ease of Doing Business and Efficient Government Service Delivery Act of 2018,” the statement quoted SEC Chairman Emilio B. Aquino as saying.

The agreement also lays down the arrangement on the conduct of the Nationwide Regulator’s Forum, which is a venue to discuss with external auditors the developments in regulatory issuances and international standards in the field of accounting and auditing.

The framework was already adopted by the BSP under Circular 1040 dated May 20, 2019, the IC under Circular Letter No. 39 dated Aug. 8, 2019, and the SEC under Memorandum Circular No. 20 dated Nov. 11, 2019.

“This initiative is in recognition of the critical role of external auditors in promoting the fairness and integrity of financial statements and in strengthening market discipline in the financial industry,” BSP Governor and FSF Chairman Benjamin E. Diokno said.

From November 2019 to May 31, 2021, the SEC has processed and approved 251 applications for accreditation. The agency has also greenlit external audit accreditations, at 194 for BSP and 117 for IC.

The central bank earlier said that inclusion in the list of accredited external auditors is valid for five years or for a shorter period, depending on the agencies. — Luz Wendy T. Noble

T-bill, bond rates may inch down

July 5, 2021 | 12:05 am

RATES OF government securities on offer this week may be slightly lower ahead of the release of June’s inflation data.

The Bureau of the Treasury (BTr) will auction off P15 billion in Treasury bills (T-bills) on Monday, broken down into P5 billion each in 91-, 182- and 364-day debt papers.

On Tuesday, the BTr is looking to raise P35 billion from its offering of reissued seven-year Treasury bonds (T-bonds) with a remaining life of six years and nine months.

A bond trader said yields on government securities traded sideways last week as investors stayed on the sidelines ahead of the June inflation data to be released on Tuesday.

Inflation may have eased slightly in June amid improving food supply conditions and lower transport prices, analysts said.

A BusinessWorld poll of 14 analysts held last week yielded a median estimate of 4.3% for June headline inflation, matching the midpoint of the 3.9% to 4.7% estimate given by the Bangko Sentral ng Pilipinas (BSP) for the month.

If realized, June would mark the sixth consecutive month that inflation went beyond the BSP’s 2-4% target and would also be faster than the 2.5% print logged in the same month last year. Still, the month’s headline print would be slower than the 4.5% logged in May.

The central bank last month raised its inflation outlook for this year to 4% from the previous forecast of 3.9%.

For this week, two traders expect the rates of the T-bills on auction to likewise move sideways or up to five basis points (bps) lower on the back of strong demand as investors still prefer the short-term debt as uncertainties linger due to the ongoing coronavirus pandemic.

For the seven-year T-bonds, the first trader sees the rate ranging from 3.525% to 3.6%, while the second trader gave a narrower forecast band of 3.525-3.575%.

“While the market players are on the hunt for yields on a relatively low interest rate environment, you have the seven-year reissuance which would offer a slight yield pickup compared with securities at the short end of the curve,” the first trader said.

The Treasury last week made a full P15-billion award of the T-bills it auctioned off as rates dipped across the board. Total bids reached P53.567 billion.

Broken down, the BTr borrowed P5 billion as planned via the 91-day T-bills at an average rate of 1.031%, down from the 1.078% fetched at the June 28 auction.

It also raised the programmed P5 billion from the 182-day debt after the tenor’s average rate fell to 1.332% from the previous week’s 1.348%.

For the 364-day securities, the Treasury made a full P5-billion award at an average rate of 1.562%, lower than the 1.563% seen previously.

Meanwhile, the last time the government offered the series of seven-year bonds on offer on Tuesday was on May 18, when it raised P35 billion as planned from P84.305 billion in total bids.

The notes fetched an average rate of 3.678% at that auction, higher than the 3.625% coupon.

The Treasury is looking to raise P235 billion from the local market this month: P60 billion via weekly offers of T-bills and P175 billion from weekly auctions of T-bonds.

The government wants to borrow P3 trillion from domestic and external sources this year to help fund a budget deficit seen to hit 9.3% of gross domestic product. — BML

Electronic toll system for P30-B CCLEX now in the works

July 5, 2021 | 12:04 am

METRO Pacific Tollways Corp. (MPTC) said its P30-billion Cebu-Cordova Link Expressway (CCLEX) is approaching completion and an electronic toll system is now being prepared.

“The preparations for the electronic system are ongoing and we foresee that the CCLEX will have a cashless toll system to give the riding public a convenient and seamless travel by providing this kind of innovative solution,” MPTC President and Chief Executive Officer Rodrigo E. Franco said in a statement posted on the CCLEX’s official website.

The 8.5-kilometer toll bridge is 75% complete as of June, according to MPTC subsidiary Cebu Cordova Link Expressway Corp. (CCLEC).

CCLEC expects the project to be substantially completed by the end of 2021.

“CCLEX has a design speed of 80 kilometers per hour (kph) and a navigational clearance or height of 51 meters so as to allow large vessels to pass underneath the bridge,” the company noted.

“Not only is CCLEX seen to reduce traffic and make traveling more convenient but also spur trade activities and open greater economic opportunities for Cebu and the rest of the Visayas region,” it added.

The toll bridge project, which is expected to serve around 50,000 vehicles daily, will connect Cebu City with Cordova, in the south of Mactan Island.

The bridge was originally scheduled to open in March, in time for the commemoration of the 500^th anniversary of Christianity in the Philippines.

MPTC is the tollways arm of Metro Pacific Investments Corp., one of the three key Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc.

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

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