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Camiguin Water allots P400M for expansion

Camiguin Water Co. will invest up to P400 million for the development and expansion of water services in the province, a company official said on Friday.

Zenon Dimaranan, lead for water at Camiguin Water, said in a virtual briefing that a water system masterplan will be undertaken to serve 47% of the provincial population without access to clean and safe water.

“We are committed to investing P400 million for the development of the existing [water] system including the expansion,” Mr. Dimaranan said.

Camiguin Water Co., a subsidiary of Mizu Resources Inc., will be in charge of the water project in the province.

“Without development, we expect a supply gap of 11 to 21 million liters per day (MLD) in the next 25 years because no one can stop the increase of water users in Camiguin,” Mr. Dimaranan said.

The plan will span 30 years and will be divided into three phases, he said.

He said 65% or almost P340 million of the budget will be spent during the first seven years of the project.

“The first two phases consist of five years each and the last part is concerned with a sustainable solution,” Mr. Dimaranan said.

“We need to rehabilitate the existing system such as reducing network losses in order to prepare it for phase two, which is expansion to unserved barangays,” he added.

Mr. Dimaranan said an ongoing project called the Jardio Water System Project is included in the first phase of the plan.

The project, which costs P39 million, started on May 4 last year and is estimated to be finished by the second quarter of 2022.

Camiguin Water was granted a 30-year franchise, which was issued in November 2019. — Revin Mikhael D. Ochave

Premiere Horizon keen on ‘play2earn’ platform

Premiere Horizon Alliance Corp. (PHA) on Friday said it was planning to partner with Bengga Corp. to develop a “play2earn” platform.

In a disclosure to the stock exchange, PHA said it recently signed a memorandum of understanding with Bengga, a Filipino-developed play2earn company, for a partnership in developing a gaming platform in the play2earn gaming category dubbed “PHlay”.

“PHA will be undertaking this project with Bengga through its subsidiary, PH Big Bounty Entertainment, Inc. (PHBB), subject to final negotiation of the terms and condition of the agreement and approval of the PHA Board of Directors,” the listed company said.

The two companies want to form a joint venture company that will be majority-owned by PHBB at 70% and 30% to be owned by Bengga.

PHA described the project as a “hypercasual” gaming platform that will earn users rewards.

“It is a means to reach an audience and influence their behavior while monetizing engagements,” it noted.

“The business model will be a relevant and timely focus in the high-growth and profitable play2earn sector. This is in line with PHA’s direction of exploring opportunities in the technology sector to complement the offerings and services of SquidPay Technology, Inc.,” the company added. — Arjay L. Balinbin

PT&T names new chairman

Listed telecommunications firm Philippine Telegraph & Telephone Corp. (PT&T) announced on Friday the appointment of Roberto “Bob” B. Ortiz as new chairman of its board, replacing Salvador “Buddy” T. Zamora II.

Mr. Zamora will now focus on “personal endeavors outside the company,” PT&T said in an e-mailed statement. He will continue to serve as non-executive director of the company.

PT&T said Mr. Ortiz has been serving as its independent director since 2018.

“On behalf of the board, and personally, I would like to thank Buddy for the contribution he has made to PT&T during his chairmanship. He has been an excellent chair and has played a crucial role in the successful development of PT&T,” said James G. Velasquez, PT&T director and chief executive officer.

“We are delighted to welcome Bob as the new Chairman. As we aim to expand our footprint nationwide and solidify our digital transformation services, Bob’s experience and entry as our new chair is timely as we shift gear towards raising funds and start our investor roadshows,” he added.

The company said Mr. Ortiz has over 27 years of experience in finance, corporate governance, and investment banking. — Arjay L. Balinbin

Jollibee opens first store in Spain

JOLLIBEE FOODS Corp. opened its first store in Spain as part of its ongoing global expansion efforts.

The restaurant firm said in a statement on Friday that its first store in Spain opened on Sept. 23 and is located at Puerta del Sol in Calle Arenal, Madrid.

Jollibee said the branch is the company’s largest restaurant in Europe. It has a capacity of 200 diners and displays new design features including a full-size indoor palm tree in a two-storey dining room.

“The Madrid restaurant introduces Jollibee’s brand redesign for European customers to Spain, aiming to create a memorable experience with bright graphics, bold wall murals, and tiles inspired by woven fabrics. Unique to the Madrid restaurant is a life-sized palm tree adorning its double-height central dining space – something not seen in any other Jollibee restaurant in the region,” Jollibee Europe Business Head Adam Parkinson said.

Jollibee Chief Executive Officer Ernesto Tanmantiong said the company’s entry into Spain marks a major milestone in the company’s history and international expansion.

“The heartwarming reception to our opening in Spain inspires us in our journey to bring our much-loved Chickenjoy to more countries in Europe, and is in line with our vision to become among the top five restaurant companies in the world,” Mr. Tanmantiong said.

Dennis Flores, president of Jollibee Europe, Middle East, Asia, and Australia (EMEAA), said the opening of the Madrid store is part of the company’s plan to make Spain into one of its core markets in the region. “With our delicious food, friendly prices, and warm service, we hope to continue enticing more locals to love our food just as we see in other countries across EMEAA,” Mr. Flores said.

Meanwhile, Jollibee Spain General Manager Clara Breda said the restaurant has take-out pick-up areas, digital kiosks for transactions, and hand-washing stations.

The company recently announced that it will be allotting €10 million to fund its expansion in Spain. It is a fifth of the €50 million investment it allotted for its expansion in Europe. Jollibee aims to establish 50 stores in Europe during the next five years.

On Friday, shares of Jollibee at the stock exchange dropped 0.69% or P1.40 to end at P202 apiece. — Revin Mikhael D. Ochave

BSP earnings up 250% in seven months to July

The Bangko Sentral ng Pilipinas (BSP) said its net income was P48.71 billion in the seven months to July, up 250%, as revenue nearly doubled due to a strong trading performance as well as interest and fee income.

According to preliminary BSP data, earnings grew from P45.44 billion posted in the first half.

Revenue rose 95.3% to P107.75 billion at the end of July and was up 12.4% from the first half total following a 42% gain in interest income to P65.59 billion.

Miscellaneous income, which includes trading gains or losses, fees, penalties and other operating income, rose to P42.16 billion from P8.98 billion a year earlier.

Month-on-month, miscellaneous earnings rose 2%. These earnings have surpassed the full-year tally of P32.7 billion generated in 2020.

The bank posted a net foreign exchange gain of P800 million, reversing a loss of P320 million a year earlier. The bulk of the gains happened in Juy after gains were only at P50 million as of the first half.

The central bank’s overall expenses stood at P59.85 billion in the seven months, up 46.7% from a year earlier and up 18.4% from the first half.

Interest expense rose 39% to P34.67 billion and 16.4% against the first half tally. — Beatrice M. Laforga

Pag-IBIG mortgage disbursements hit P58.52 B in eight months to August 

Home Development Mutual Fund, which trades under the brand Pag-IBIG, said it released P58.52 billion worth of home loans in the eight months to August.

In a statement Friday, Pag-IBIG said home loans for the first eight months rose 96% from a year earlier, and went out to 57,235 members.

Pag-IBIG said members’ savings under the voluntary Modified Pag-IBIG 2 (MP2) Savings program amounted to P17.73 billion.

Pag-IBIG Fund Chief Executive Officer Acmad Rizaldy P. Moti expects improved results as the vaccine rollout progresses.

“Even with the ongoing pandemic, the amount of home loans released and MP2 Savings collections from January to August 2021 are not only record highs but are higher than what we achieved during the same period in 2019, prior to the pandemic,” Mr. Moti said.

“The continued trust of our members and stakeholders gives us the confidence that we shall achieve another best year in fulfilling our mandates. In return, we shall remain as their reliable partner by providing programs that address their needs, especially during this health crisis,” he added. – Revin Mikhael D. Ochave

China says all crypto-related transactions are illegal

Reuters

China’s central bank said all cryptocurrency-related transactions are illegal and must be banned, sending the strongest signal yet on its determination to crack down on the industry.

All cryptocurrencies, including Bitcoin and Tether, are not fiat currency and cannot be circulated on the market, the People’s Bank of China said on its website. All crypto-related transactions, including services provided by offshore exchanges to domestic residents, are illicit financial activities, the PBOC said in the statement.

This latest harsh directive, which sent Bitcoin dropping as much as 5.5% on Friday, comes as global markets grow increasingly concerned over a debt crisis involving property developer China Evergrande Group. The Chinese government may also be responding to signs that miners are disguising their activities to stay in business.

Vijay Ayyar, head of Asia Pacific with cryptocurrency exchange Luno in Singapore, said that while the Chinese government has made similar statements in the past, it is “a slightly nervous environment for crypto with the recent SEC comments and overall macro environment with the Evergrande news. So any comments of this nature will cause a sell-of in risky assets.”

The nation’s economic planning agency also said it is an urgent task for China to root out crypto mining, and the crackdown is important to meet carbon goals.

Investors should expect “knee-jerk price reaction as China takes the wind out of Bitcoin’s sails,” said Antoni Trenchev, co-founder of crypto lender Nexo.  “The recent rebound from just below $40,000 has likely run its course for now.”   — Bloomberg

Peso weakens further on inflation fears

PHILIPPINE STAR/KRIZ JOHN ROSALES

The peso continued to weaken against the dollar Friday on lingering inflation concerns after the central bank raised its medium-term projections for inflation.

The peso closed at P50.65 against its P50.34 finish on Thursday, according to the Bankers Association of the Philippines.

The peso opened at P50.32, with the low at P50.67 and the high at P50.24.

Dollar volume rose to $1.185 billion from $1.079 billion on Thursday.

The peso weakened by 70 centavos from the P49.95 close on Sept. 17.

“The peso weakened after the BSP (Bangko Sentral ng Pilipinas) upwardly revised its inflation projections despite keeping its policy rate unchanged,” a trader said via e-mail Friday.

During its policy-setting meeting Thursday, the BSP raised its inflation outlook for the year to 4.4% from 4.1% previously as supply issues continue to push food prices higher. This took it beyond the 2-4% target of the central bank for 2021.

Headline inflation rose to 4.9% in August from 4% in July, its highest level in more than two years, to bring the eight-month average to 4.4%.

The foreign exchange market was also reacting to indications that the Federal Reserve may start reducing its monthly bond buying program by November, Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort said via Viber Friday.

The Fed said Wednesday it could begin the “taper” if jobs data remain strong, Reuters reported.

Interest rate hikes may also begin next year once the bond-buying program ends, as nine of 18 Fed policymakers believe borrowing costs have to increase in 2022.

“The peso also (ended) weaker as the dollar was near one-month highs after some global safe haven shifts to the US currency in recent days (as) concerns over China Evergrande led to some profit-taking in the global financial markets,” Mr. Ricafort added. – Beatrice M. Laforga

DoF wants to wean crop insurance firm off subsidies, expand coverage

BLOOMBERG

The Department of Finance (DoF), which is now overseeing the Philippine Crop Insurance Corp. (PCIC), said its goal is to make the company less reliant on subsidies and provide broader coverage to respond to the threat of climate change.

Finance Secretary Carlos G. Dominguez III, recently named the chairman of PCIC, told board members that the top priority for the company is to “stop its financial bleeding,” adding that “Unless we are able to scale up our crop protection insurance, we cannot substantially mitigate economic losses due to calamities further intensified by climate change.”

He was speaking at the first meeting of the reconstituted PCIC Board Friday. The lead agency overseeing the company previously was the Department of Agriculture (DA).

Mr. Dominguez noted that the PCIC received subsidies of P23.3 billion in the past two years, and an additional P5.3 billion in financial support from the Agri-Agra Fund since 2015.

Next year, the company is expected to receive P4.5 billion in budgetary support from the national government.

“This trend is not sustainable,” Mr. Dominguez said.

“The PCIC’s operations must be sustainable—if not totally subsidy-free. This requires a new business model and the most competent management of this service,” he added.

Mr. Dominguez said the PCIC should expand the insurance coverage to cover more assets and crops with lower premiums to provide greater protection from potential financial losses due to natural calamities.

He also urged the company to explore reinsurance and encourage more private companies to offer agriculture insurance products.

“The PCIC should likewise consider other types of insurance programs implemented in other countries, such as the index-based or parametric insurance,” he added.

Aside from expanding its operations, the PCIC should also determine how much the government is losing by insufficiently covering the agriculture sector, he said.

Mr. Dominguez said he met with representatives of the PCIC and the Insurance Commission to formulate a blueprint for the company over the next three years.

President Rodrigo R. Duterte signed Executive Order (EO) No. 148 on Sept. 14, which transferred oversight of the PCIC to the DoF.

The Federation of Free Farmers has described the move as potentially making the company less responsive to farmers’ needs.

Mr. Dominguez has said that the DoF has no current plans of privatizing the PCIC.

The PCIC provides subsidized insurance protection to farmers against losses from natural disasters and plant and animal diseases, particularly for corn and rice.

The EO reconfigured the PCIC Board to make the Finance secretary chairman, relegating the Agriculture secretary to vice-chairman and reducing the number of farmer representatives on the board from three to one.

Members of the board include the PCIC president, the Land Bank of the Philippines president, the Government Service Insurance System president and general manager, a private insurance industry representative, and a farmer representative.

“I trust this board will find the path to sustainability. Our farmers face the increasing likelihood of suffering losses due to severe and erratic weather events caused by climate change. Crop insurance is an effective instrument to mitigate dislocation and economic losses. The PCIC must be there to extend the widest coverage possible,” he said. – Beatrice M. Laforga

Power spot market price falls in first 3 weeks of September 

The average spot market price fell 35% month-on-month to P3.10 per kilowatt hour (/kWh) in the first three weeks of September due to improved supply, according to the Independent Electricity Market Operator of the Philippines (IEMOP).

The drop was due to “an increase in the supply margin,” IEMOP Manager for Market Simulation and Analysis John Paul S. Grayda said in a virtual briefing Friday.

The market operator reported that the rate for this month’s billing period covered the period Sept. 1 to 21.

In a statement issued Friday, IEMOP said it expects prices to further drop this month due to sufficient supply which will mostly come from coal-fired power plants and a decrease in average demand, which was 9,824 megawatts (MW) as of Sept. 21.

IEMOP also said that the effective settlement spot price (ESSP) fell to P5.13/kWh in August compared to P7.12/kWh.

“This trend has been observed since the month of June given the persisting colder weather conditions. The total spot percentage also decreased for this period by 9.6% to 8.6%. The generation for August spot transactions was recorded at 6,989 gigawatt hours (GWh),” it said.

However, IEMOP said system peak demand rose to 12,481 MW in September from 12,272 MW the month before.

During the briefing, Robinson P. Descanzo, IEMOP Chief Operating Officer, said simulations indicate sufficient power supply for the Oct. 2 to 22 period, or during the scheduled maintenance shutdown of the Malampaya gas field.

“Historically again, we saw that (the natural gas plants) offer prices are not that high when fired with condensate because I think the main reason is they are fully covered by the contracts,” Mr. Descanzo said.

“Since some natural gas plants will still be operating on liquid fuel in lieu of natural gas during the temporary shutdown and providing power to the grid, price volatility will be likely dampened,” he added.

Meanwhile, IEMOP Spokesperson Andrea Mae T. Caguete estimated that the reserves market will be implemented by 2022. The planned market seeks to encourage investors to build facilities that will address ancillary services requirements.

However, Ms. Caguete said the wholesale electricity spot market (WESM) for Mindanao will be implemented first prior to the reserves market.

IEMOP Operations Senior Specialist Valfia S. Uy-Gregorio said amendments have been made to the WESM rules and related market manual.

“We are looking at its (reserves market) implementation in 2022. I think the WESM Mindanao is being targeted this year… hopefully within the fourth quarter of 2021,” Ms. Gregorio said.  – Revin Mikhael D. Ochave

Wholesale price growth of general goods hits 19-month high

Wholesale price growth of general goods hit a 19-month high in July, the Philippine Statistics Authority (PSA) said Friday.

Preliminary PSA data indicate that the general wholesale price index (GWPI) rose 2.9% year-on-year in July, accelerating from the 2.2% posted in June and the 2.7% from a year earlier.

The July figure was the highest since the 3.1% growth recorded in December 2019. It also matched the growth rate from January 2020.

In the seven months to July, the GWPI rose 2.6%, up from the year-earlier rate of 2.5%.

The acceleration in prices was attributed to stronger price growth in food (1.2% from 0.5% in June); beverages and tobacco (4.3% from 4.1%) ; mineral fuels, lubricants and related materials (18.2% from 15.9%); and manufactured goods classified chiefly by materials (3.9% from 0.8%).

Price growth decelerated in crude materials, inedible except fuels (38.5% from 39.2%); chemicals including animal and vegetable oils and fats (5.3% from 5.7%); and miscellaneous manufactured articles (0.3% from 3%).

Compared with the previous month, growth in wholesale prices of machinery transport and equipment was unchanged at 0.9%.

Wholesale prices in Luzon posted 3% growth in July, following a 2.1% expansion in June.

In the Visayas, the GWPI grew 0.6%, picking up from 0.4% the previous month.

In the year to date, the GWPI for Luzon and Mindanao rose 2.7% and 4.3%, respectively. On the other hand, wholesale prices in the Visayas declined by 0.1%.  – Lourdes O. Pilar

SMC, gov’t break ground on P95-B Pasig river expressway project

San Miguel Corp. (SMC) and the government broke ground on the 19.37-kilometer Pasig River Expressway (PAREX) project on Friday.

“PAREX will be built to accommodate more than just motor vehicles. Once complete, it will feature a bus rapid transit system that will benefit commuters all over Metro Manila,” SMC said in a statement.

The supplemental toll operations agreement for the PAREX project was signed on Sept. 21.

The project is a six-lane elevated expressway that will run from Radial Road 10 in the city of Manila to Circumferential Road 6, also known as the future South East Metro Manila Expressway (SEMME) in Taguig. It will run along the banks of the Pasig River.

“Once operational, PAREX will link the eastern and western cities of Metro Manila and will connect to the Skyway system, realizing the vision of an integrated elevated road network that will link the north, south, east, and west corridors of the capital,” SMC said.

“The expressway will also have dedicated bike lanes to encourage healthy, environment-friendly modes of personal transportation, as well as pedestrian walkways to encourage walking or exercise,” it added.

The conglomerate has allotted P2 billion to rehabilitate the Pasig River.

It is also planning to expand water transport through ferries that will connect Metro Manila’s main waterways like Laguna de Bay, the Pasig River, Manila Bay, and the Marikina River. – Arjay L. Balinbin

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