THE TOURISM industry’s contribution to the economy plunged to its lowest level in at least two decades in 2020 amid the ongoing coronavirus disease 2019 (COVID-19) pandemic, Philippine Statistics Authority (PSA) data released on Wednesday showed. Read the full story.
Here’s a quick glance at how PSEi stocks fared on Wednesday, June 16, 2021.
The newly established committee for trade facilitation is expected to help micro-, small-, and medium-sized enterprises (MSMEs) to be more active in international trade and widen their access to international goods and services, Finance Secretary Carlos G. Dominguez III said.
During its first meeting Wednesday, Mr. Dominguez said the Philippine Trade Facilitation Committee (PTFC), which he chairs, aims to make Customs processes more efficient to benefit the small firms in their pursuit of international business.
“Our work is especially critical for the MSMEs that often do not have the financial capacity to overcome the inefficiencies of the trading system and lack access to the global markets. What we aim to accomplish here will allow them to actively participate in international trade and broaden their access to the global value chains,” he said in a speech.
President Rodrigo R. Duterte issued Executive Order No. 136 on May 18, creating the PTFC to streamline customs processes and help the Philippines comply with commitments under the World Trade Organization-Trade Facilitation Agreement (WTO-TFA).
WTO-TFA, established in February 2017, requires member countries to have a national committee on trade facilitation or assign an existing system that will implement the TFA.
The agreement aims to fast-track movement of goods and encourages customs authorities to collaborate with other agencies on trade facilitation. The WTO estimates that fully implementing the TFA can bring down trade costs by 14.3% on average and boost international trade by $1 trillion yearly.
Mr. Dominguez said streamlined procedures in customs and trade can spur job creation, attract investment, help upgrade the skills of workers and spur entrepreneurship. Eventually, this will help the economy grow faster and sustainably over the long term, he added.
He said modernizing operations at the Bureau of Customs will also cut trade costs, pave the way for more transparency, boost government revenue, reduce corruption and improve the digital economy.
“A streamlined, transparent, and efficient customs administration will result in a more conducive trading environment for all our businesses. This is expected to increase our trade volumes and reduce costs for consumers and producers,” he said. — Beatrice M. Laforga
THE Philippine Competition Commission (PCC) said it is looking into whether the recent power outages on the Luzon Grid are the result of collusion, as part of a broader investigation involving the Justice and Energy departments.
“The outages may result from many sources. Obviously, if it is an outcome of collusive practices, that’s terrain for the PCC,” PCC Chairman Arsenio M. Balisacan told ANC Wednesday. Outages caused by natural factors are outside the commission’s mandate.
The grid was recently placed on red alert for three consecutive days after a series of unscheduled power plant outages, causing a spike in market prices.
The Energy Regulatory Commission said it will order generation companies to explain the interruptions. A commission task force has scheduled four plants for technical inspection.
“We’ll do (the investigation) as fast as we can to contribute to the resolution of this case,” Mr. Balisacan said.
“Our mandate is to prevent anti-competitive practices, so if these are things emanating out of abusive practices in such a way that the players can enhance their profits, then obviously that’s a thing for PCC and we will investigate the matter.”
Meanwhile, an Udenna Corp. unit’s acquisition of Shell Petroleum N.V.’s stake of the Malampaya gas field could still be assessed after a pause in the review, he said.
Compulsory notification on all mergers and acquisitions with transaction value of below P50 billion is suspended for two years from the effectivity of Republic Act No. 11494, informally known as Bayanihan II, which was signed in September. The law also suspended the PCC’s review of these transactions, conducted on its own initiative, for a year.
The PCC is monitoring the market while it awaits the resumption of its own assessment of transactions below the threshold value in September.
“We encourage players, if in doubt about the nature of the transaction, (to have a) free consultation with the PCC,” Mr. Balisacan said.
“If there are reasons to believe that there is an element anti-competitive practice there then we will exercise our motu propio review power.” — Jenina P. Ibañez
THE year-on-year growth in wholesale prices of general goods slowed in April compared to the rate recorded in March, the Philippine Statistics Authority (PSA) said Wednesday.
The general wholesale price index (GWPI) rose 2.7% year on year in April, against the 2.8% pickup in March, according to preliminary data.
Driving the April outcome were moderating price increases in the following: food (1.9% in April from 2.4% in March); crude materials, inedible except fuels (42.9% from 44.4%); and manufactured goods classified chiefly by materials (0.7% from 0.8%).
The PSA noted faster price growth in mineral fuels, lubricants and related materials (17.9% from 11.9%); chemicals including animal and vegetable oils and fats (5.4% from 5.2%); and machinery and transport equipment (0.6% from 0.5%).
Growth was steady for beverages and tobacco (7.4%) and miscellaneous manufactured articles (0.7%).
Wholesale prices in Luzon registered 2.8% growth in April, easing from 2.9% in March.
In the Visayas, wholesale prices grew 0.7%, reversing the 0.6% drop recorded the previous month.
In Mindanao, wholesale prices rose 4.6% in April from 4.5% previously.
In an e-mail, Security Bank Corp. Chief Economist Robert Dan J. Roces attributed the easing of wholesale prices to mobility restrictions caused by strict lockdowns imposed during the month.
Metro Manila and adjacent provinces were placed under enhanced community quarantine (ECQ) between March 29 and April 11 after a surge in coronavirus disease 2019 (COVID-19) cases. This was later relaxed to a lockdown setting of modified ECQ between April 12 and May 14.
“With the shift to looser community quarantines, expect the GWPI to trend higher in the months ahead,” he said.
The GWPI monitors wholesale trade sector and is among the indices used as a deflator in the PSA’s national accounts. — N. M. A. Bo
The National Electrification Administration (NEA) said Wednesday that electric cooperatives (ECs) connected 148,792 new power consumers in the first quarter, up 11% year on year, as the agency works towards a target of 400,000 by the end of 2021.
NEA Information Technology and Communication Services Department Manager Roderick N. Padua said in a statement that the connection total represents 37% of the new connections target for the year.
The NEA said the nationwide electrification rate is now at 90% with 14.45 million consumers covered within the franchise areas of 121 ECs nationwide.
“Luzon is now 95% energized with 6,745,982 connections; Visayas at 93% with 3,826,682 connections; and Mindanao at 80% with 3,873,635 connections,” it said.
NEA estimates the number of unserved consumers at 1.45 million, based on the 2015 population and housing census.
The NEA earlier reported that its ECs connected over 522,000 new power consumers in 2020, surpassing the target by 14%. — Angelica Y. Yang
An online consumer dispute resolution system will be rolled out soon in response to a spike in consumer complaints last year, the Trade department said.
The system being developed by the Department of Trade and Industry’s (DTI) consumer protection group will be a unified consumer complaints portal linking various government departments.
Consumer complaints received by the DTI’s consumer protection group increased after a surge in online shopping during the lockdown, the DTI said in a statement Wednesday.
Through the online system, consumers can file complaints and seek redress as long as the products bought either online or offline are from a business in the Philippines.
In the first phase of development, the DTI and its partners are assessing consumer complaints management tools to come up with recommendations for the online system.
“The system will help both the DTI and the consumers because through the online platform, it will be easier to document and track every process of a complaint,” DTI Consumer Protection Group Assistant Secretary Ann Claire C. Cabochan said.
The DTI is working with the United States Agency for International Development – University of the Philippines Public Administration Research and Extension Services Foundation, Inc. in developing the system.
The system is a response to DTI Administrative Order No. 20-05 issued in September to develop such a consumer complaints system. — Jenina P. Ibañez
EFFORTS to end hunger by 2030 and reduce the effects of climate change will gain impetus from a pooling of international expertise, Agriculture Secretary William D. Dar said.
Speaking at the virtual 42nd session of the United Nations Food and Agriculture Organization (FAO) conference on June 15, Mr. Dar said such cooperation could be a pathway to meeting Sustainable Development Goals in relation to hunger and climate change.
“It is important that international pooling of knowledge, science and technology, and innovation is further encouraged, and that their benefits should extend to all sectors and stakeholders across all nations,” Mr. Dar said.
“Because of the complexities brought about by climate change and its impact on food systems, as well as the new normal brought about by the coronavirus disease 2019 (COVID-19) pandemic, we should ensure that the benefits of science-driven innovation find a place in our farms as well as in the homes of every rural family and ultimately, in every home in all societies,” he added.
Mr. Dar said the Philippine government is pursuing private investment and partnerships to modernize and industrialize its farm sector sustainably.
“Agriculture is the mainspring of rural economic progress in the Philippines, and its development is key to addressing the bigger part of our continuing problem of poverty,” Mr. Dar said.
At the conference, FAO Director-General Qu Dongyu said the global effort to end hunger, achieve food security, and narrow inequality is hindered by conflict, climate change, and economic disruption.
“The future of agriculture needs to be built on science, innovations and digital applications, that can produce significant gains in terms of increased efficiency, facilitate the good functioning of supply chains and enhance sustainability,” he said.
Meanwhile, Microsoft Corp. co-founder and philanthropist Bill Gates said assistance should be given to smallholder farmers especially in low-income countries, adding that investment must be pursued in climate-resilient agriculture.
“Smallholder farmers are accustomed to overcoming incredible adversity and are constantly innovating based on changing weather and market demands. But they cannot solve this alone. Better data is needed to measure progress,” Mr. Gates said. — Revin Mikhael D. Ochave
NEW DELHI — India, the world’s top importer of vegetable oil, will have to spend billions of extra dollars this year to buy more costly cooking oil from overseas and is mulling cutting taxes on those imports to soften the blow to the economy, industry officials have said.
The government is considering reducing taxes on vegetable oil imports after cooking oil prices hit record highs last month as it seeks to make food costs more affordable for its population of over 1.3 billion and keep price pressures at bay.
Problems in the global production of key oilseeds coupled with rising biodiesel use have fuelled the global vegoil rally.
Soyoil futures have jumped more than 70% this year after drought tightened US and Brazilian soybean supplies. The US Department of Agriculture has forecast global soybean stocks will fall to a five-year low of 87.9 million tons by September.
Palm oil prices, the most widely consumed edible oil, also rallied 18% in 2020 after COVID-19 lockdowns curbed output from plantations in Southeast Asia.
Benchmark futures in Malaysia touched 4,142 ringgit ($1,007.30) a ton in mid-March, their highest since 2008.
Poor rapeseed and sunflower seed harvests in Europe and the Black Sea region further tightened edible oil supplies, helping push global food prices to 10-year highs last month.
Mirroring record global prices, domestic palm oil and soyoil rates have more than doubled in the past year.
As the top edible oil importer, India spends an average of $8.5-$10 billion annually on imported vegoils and the recent price surge will only inflate its bloated import bill further. Vegetable oil is India’s third-biggest import item after crude oil and gold.
India’s vegetable oil imports have surged to 15 million tons from 4 million only two decades ago, according to industry estimates. It could touch 20 million by 2030, trade and industry experts say, boosted by a growing populace with higher incomes and a taste for calorie-laden curry and fried food.
Domestic oilseed production has failed to keep pace with demand, as farmers prefer to grow grains like rice and wheat, the price of which is guaranteed by the government.
India produced about 10.65 million tons of edible oils in 2019-20, less than half of the roughly 24 million tons it consumed during that period, according to trade and government estimates.
It imported the rest, buying around 7.2 million tons of palm oil from Indonesia and Malaysia, about 3.4 million tons of soy oil from Brazil and Argentina, and 2.5 million tons of sunflower oil, mainly from Russia and Ukraine.
Soaring vegetable oil prices have further hit people already reeling from record fuel prices and lower incomes due to a devastating second wave of COVID-19 infections.
The government has voiced support for greater domestic production of oil crops in recent years, and had been expected to unveil incentives for farmers willing to expand oilseed output in its latest annual budget plan.
But the government has yet to come up with a viable plan to raise oilseeds production.
India grows several oilseeds — mainly peanuts, soybeans and rapeseed (mustard) — but their prices are not guaranteed by the government like grain prices are. As a result, Indian output of rice and wheat is nearly six times greater than total oilseed output on average.
The vegetable oil industry has argued that the government, which earns about 350 billion rupees ($4.79 billion) from levies on edible oil imports, should set aside some of that to incentivize farmers to switch to oilseeds.
But the government has not taken any such measure so far in 2021, and is relying on adjusting import tax rates to try to control volumes and prices. — Reuters
STOCKS went down on Wednesday as investors remained concerned over the country’s coronavirus disease 2019 (COVID-19) situation amid the easing of quarantine restrictions in Metro Manila and nearby provinces.
The benchmark Philippine Stock Exchange index (PSEi) declined by 3.38 points or 0.04% to close at 6,973.35 on Wednesday, while the all shares index went down by 1.08 points or 0.02% to 4,221.80.
“The PSEi ended just a few points lower, mainly a flat performance as gains in blue-chip banks offset minor losses in holding firms and other issues that rallied in the previous session,” AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in an e-mail.
“The index fluctuated throughout the day, as investors weighed carefully the decision of the government to ease the quarantine measures currently implemented in the capital region, against the rising COVID-19 cases in other regions of the country,” Darren Blaine T. Pangan, trader at Timson Securities, Inc., said in a Viber message.
Meanwhile, China Bank Securities Corp. Research Associate Zoren Philip A. Musngi said investors were “generally bullish” due to the strong remittances data seen in the month of April and the developments in the country’s vaccination program.
“The day’s rally was led by the financials sector, which is seeing some investor interest after BSP (Bangko Sentral ng Pilipinas) Governor Benjamin E. Diokno recently said that lending is expected to grow by [the third quarter] as confidence recovers due to reopening of economy,” Mr. Musngi said in a separate e-mail.
The central bank reported on Tuesday that cash remittances rose by 12.7% year on year to $2.305 billion in April.
Meanwhile, Mr. Diokno said last week that lending could return to growth next quarter as confidence improves on the back of progress in the government’s vaccination program.
Most sectoral indices closed in the red on Wednesday except for financials, which gained 37.72 points or 2.54% to 1,520.55, and property, which improved by 19.80 points or 0.57% to finish at 3,448.94.
Meanwhile, mining and oil shed 188.61 points or 1.96% to 9,403.77; industrials lost 122.12 points or 1.27% to 9,445.89; services went down by 16.08 points or 1.02% to close at 1,546.74; and holding firms declined by 39.90 points or 0.56% to 6,987.89.
Value turnover increased to P10.71 billion with 5.22 billion issues traded on Wednesday, from the P8.03 billion with 5.13 billion shares switched hands on Tuesday.
Advancers beat decliners, 111 against 96, while 53 names closed unchanged.
Net foreign selling ballooned to P625.17 million on Wednesday from the P58.79 million seen on Tuesday.
Timson Securities’ Mr. Pangan expects the index to trade between 6,760 to 7,090.
“For [Thursday], we expect another attempt to break through the 7,000 resistance level, but ultimately might end up lower as more investors take profit…,” China Bank Securities’ Mr. Musngi said. — Keren Concepcion G. Valmonte
THE PESO retreated versus the greenback for the third straight day due to higher oil prices and as the market was waiting for the policy decision of the US Federal Reserve.
The local unit closed at P48.09 per dollar on Wednesday, shedding six centavos from its P48.03 finish on Tuesday, data from the Bankers Association of the Philippines showed.
The peso started the session at P48.08 per dollar. Its weakest showing was at P48.19 while its intraday best was at P48.05 against the greenback.
Dollars exchanged slipped to $1.151 billion on Wednesday from $1.158 billion on Tuesday.
The peso weakened due to higher dollar demand and as higher oil prices could increase the country’s import bill, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a text message.
Reuters reported that oil prices continued to increase due to the recovery in demand and a drop in US crude inventories. Brent crude rose 29 cents or 0.4%, at $74.28 a barrel by 0815 GMT on Wednesday, and earlier reached $74.73, the highest since April 2019.
Meanwhile, a trader said the market was risk-off mode due to US data and ahead of the latest monetary policy decision of the Fed.
“The peso depreciated following the stronger-than-expected US producer inflation report and caution ahead of the Fed policy decision,” the trader said in an e-mail.
The US Labor department on Tuesday reported that its producer price index for final demand rose by 0.8% in May after a 0.6% rise in April. In the 12 months through May, the index rose 6.6%, which is the quickest since November 2010.
Meanwhile, the Fed was set to end a two-day policy meeting overnight, where it was expected to keep rates steady and discuss the unwinding of its asset purchase program.
For today, Mr. Ricafort expects the local to move within the P48.03 to P48.18 band, while the trader gave a wider forecast range of P48.00 to P48.20 per dollar. — LWTN with Reuters
By Kyle Aristophere T. Atienza, Reporter
THE HEALTH department on Wednesday flagged hospitals in two cities near the Philippine capital that are near their breaking point, as coronavirus deaths nationwide breached 23,000.
The cities of Makati and Muntinlupa have been overwhelmed by COVID-19 infections despite falling healthcare use rate in the capital region, Health Undersecretary Leopoldo J. Vega told a televised news briefing.
The Department of Health (DoH) reported 5,414 coronavirus infections on Wednesday, bringing the total to 1.33 million.
The death toll rose by 158 to 23,121, while recoveries increased by 7,637 to 1.25 million, it said in a bulletin.
The use rate of hospitals in Makati and Muntinlupa had almost reached a high-risk level, Mr. Vega said.
Mr. Vega said hospitals in Rizal province near the capital region have also been overwhelmed by rising coronavirus infections.
Metro Manila hospitals could still accommodate more coronavirus patients from other provinces because critical care room were still available.
Mr. Vega said the operation of command centers responsible for referring coronavirus patients to hospitals has improved after adding 80 more workers.
The government has set up regional command centers in Southern Tagalog, Central Luzon, Southern Mindanao and the Caraga region, he said.
DoH said there were 56,170 active cases, 1.3% of which were critical, 91.4% were mild, 4% did not show symptoms, 1.9% were severe and 1.36% were moderate.
The agency said 11 duplicates had been removed from the tally, seven of which were tagged as recoveries.
Two patients tagged as recoveries had been removed from the tally after they were found to be negative.
A total of 375 recoveries were reclassified as active cases, while 117 cases tagged as recoveries were reclassified as deaths. Six laboratories failed to submit data on June 14, the agency said.
About 13.3 million Filipinos have been tested for the coronavirus as of June 14, according to DoH’s tracker website.
The coronavirus has sickened about 177.4 million and killed 3.8 million people worldwide, according to the Worldometers website, citing various sources including data from the World Health Organization.
About 161.9 million people have recovered, it said.
Meanwhile, Mindanao won’t be left behind in the state’s vaccination drive, vaccine czar Carlito G. Galvez, Jr. said.
The region, where some cities have been experiencing a surge in infections, would receive more coronavirus vaccines once more supplies arrive this month, he said in a statement.
Cagayan De Oro City Rep. Rufus B. Rodriguez on Monday said his city and other areas faced surging coronavirus infections because pandemic officials have failed to give them enough vaccines.
“The National Task Force against COVID-19 would like to assure our honorable members of Congress that we will not neglect the regions, especially those in Mindanao, in our vaccine deployment,” Mr. Galvez said.
“Following President Rodrigo Duterte’s directive to deploy more vaccines to the regions, we will immediately send more vaccines to Mindanao as soon as the rest of the deliveries arrive this month,” he added.
Presidential spokesman Herminio L. Roque, Jr., on Tuesday blamed the local governments for failing to enforce lockdowns and ignoring health protocols.
“We are getting more vaccines there very soon, and Mindanao will not be left behind,” Mr. Galvez said. “This is my promise to all Mindanaoans.”
Philippine pandemic officials have said about 1.7 million doses of coronavirus vaccines had been given out in Mindanao as of June 14.
Manila has received more than 12 million vaccine doses. About six million more doses from different manufacturers are expected to arrive this month.
President Rodrigo R. Duterte on Monday night further relaxed the lockdown in Metro Manila and Bulacan province amid easing coronavirus infections, and kept the travel ban on India and its neighbors to prevent the entry of a more contagious variant.
The areas were placed under a general community quarantine “with some restrictions” from June 16 to June 30.
The President also extended the travel ban on travelers from India, Pakistan, Bangladesh, Sri Lanka, Nepal, the United Arab Emirates and Oman until the end of the month, his spokesman said in a separate statement. — with Vann Marlo M. Villegas
