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High rice prices may affect BSP’s easing cycle

Government officials inspect prices and supply of rice at a market in Quezon City, Jan. 10, 2025. — PHILIPPINE STAR /MIGUEL DE GUZMAN

STILL-ELEVATED rice prices could stoke inflation and threaten the Bangko Sentral ng Pilipinas’ (BSP) pace of monetary easing, GlobalSource Partners said.

“Such a precarious rice situation does not promise bright prospects for domestic inflation,” GlobalSource Partners Country Analyst Diwa C. Guinigundo said in a report.

“Given the inflationary impact of an expected weakening of the peso-dollar exchange rate, the uptrend in rice prices coupled with creeping fuel price increases and the reported price hikes of 63 goods in February could generate more price pressures.”

Headline inflation averaged 3.2% last year, the first time that full-year inflation fell within the central bank’s 2-4% target since 2021. It was also the slowest since 2.4% in 2020.

“The BSP would have to be careful in issuing forward guidance that commits itself to more rate reductions in the next meetings of the Monetary Board,” Mr. Guinigundo said.

“The supply side does not appear to be supportive of its 2-4% target,” he said, noting that inflation risk-adjusted forecasts for 2025 and 2026 stand at 3.4% and 3.7%, respectively.

For this year, the BSP expects inflation to average 3.3%. Accounting for risks, inflation could average 3.4%.

The Monetary Board delivered a total of 75 basis points of rate cuts last year, bringing the benchmark to 5.75%.

“Since the weight of rice at 8.9% dominates the weight of food in the consumer price index and food weighs heaviest among all the other components, economists and inflation forecasters fear of another surge in inflation this year and the next,” Mr. Guinigundo said.

The Agriculture department has announced plans to declare a food security emergency for rice. This would allow the release of buffer stocks of local rice from the National Food Authority to be sold at subsidized prices.

Mr. Guinigundo said this activity could be a “potential source of corruption.”

“Many buffer stocks could be declared aging and discounted only to be resold with minimal polishing. Given the forthcoming election, local government units  could also use them to win votes,” he said adding that the impact of this move would be “minimal.”

Rice prices were supposed to start declining after the government slashed tariffs on rice imports, Mr. Guinigundo said.

“This did not happen because one, domestic rice production remained weak; and two, profiteering from reduced tariffs did not cease but only benefited importers, wholesalers and retailers who were reported to have engineered the artificial shortage of the food staple.”

President Ferdinand R. Marcos, Jr. issued an executive order that reduced tariffs on rice imports to 15% from 35% until 2028. This took effect in July.

“The problem remains because agricultural policy to stabilize prices of key commodities continues to focus on market dynamics rather than on production and agricultural productivity,” Mr. Guinigundo said.

RESCHEDULED MEETING
Meanwhile, the Monetary Board’s first policy meeting this year was rescheduled to Feb. 13 from Feb. 20, the central bank said on Tuesday.

This as BSP Governor Eli M. Remolona, Jr. is set to attend the Financial Action Task Force (FATF) plenary and meetings in France from Feb. 17-20.

The Philippines has been on the FATF’s gray list since June 2021. Government officials are hopeful that the country can exit the gray list this year. — Luisa Maria Jacinta C. Jocson

Meralco seeks P75-B loan for JV with AboitizPower

PHILSTAR FILE PHOTO

PANGILINAN-LED Manila Electric Co. (Meralco) said it will borrow P75 billion from three major local lenders to finance its planned joint venture (JV) with Aboitiz Power Corp. (AboitizPower).

Meralco hopes to secure P75 billion in loans, payable over 12 years, from BDO Unibank, Inc., Bank of the Philippine Islands, and Metropolitan Bank & Trust Co. within the week, the power distributor said in a stock exchange disclosure on Monday.

“The loan will be used to finance investments and other general corporate purposes of the company,” Meralco said.

Meralco Chief Finance Officer Betty C. Siy-Yap said via Viber that the credit facility is intended for the “acquisition of investments in Project Chromite” and will be drawn “within the week.”

In March last year, Meralco and AboitizPower announced that their subsidiaries had entered into an investment agreement to form Chromite Gas Holdings, Inc.

Chromite Gas will be 60% and 40% beneficially owned by Meralco PowerGen Corp. (MGen) and Therma Natgas Power, Inc. (Therma), respectively.

The joint venture is part of the $3.3-billion landmark deal between MGen, Therma, and San Miguel Global Power Holdings Corp. (SMGP) to launch an integrated liquefied natural gas (LNG) facility in Batangas.

Under the deal, MGen and Therma will jointly invest in two of SMGP’s gas-fired power plants: the 1,278-megawatt (MW) Ilijan power plant and the new 1,320-MW combined cycle power facility.

MGen and Therma, through Chromite Gas, along with SMGP, will also invest in the LNG import and regasification terminal owned by Linseed Field Corp. in Batangas.

Late last year, the Philippine Competition Commission (PCC) approved the mega deal, allowing the parties to proceed with their joint acquisition of power facilities and the LNG terminal, subject to certain conditions.

Monalisa C. Dimalanta, chairperson and chief executive officer of the Energy Regulatory Commission, earlier said that the commission needs to review the LNG deal to ensure that the companies comply with market share limitations and to review power supply deals.

Meralco’s majority owner, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has an interest in BusinessWorld through the Philippine Star Group, which it controls. — Sheldeen Joy Talavera

ACMobility adding more EV charging points in Makati

ACMOBILITY

ACMOBILITY is putting up 27 more electric vehicle (EV) charging stations in Makati City within the first quarter, the mobility solutions provider announced on Tuesday.

Makati City is set to have 74 operational charging points across 18 locations, such as offices, malls, and condominiums, the end-to-end mobility solutions arm of the Ayala group said in a statement.

The plan to put up 27 more charging points, which will include 19 DC (direct-current) fast charge points, is in partnership with Ayala Land, Inc. and the Makati Central Estate Association.

“As a key city for our EV ecosystem expansion, Makati exemplifies the potential of electric mobility in urban centers, and we are dedicated to meeting its evolving needs toward a greener future,” ACMobility Chief Executive Officer Jaime Alfonso Zobel de Ayala said.

The expansion of ACMobility’s charging stations will help position the city as one of the most sustainable urban centers in the country, the company said.

“By boosting our EV infrastructure through ACMobility, we commit to the integration of cleaner technologies,” said Makati Mayor Marlen Abigail Binay-Campos.

To date, ACMobility has 47 charging points in Makati City, which are located in offices, transport terminals, residential areas, and commercial spaces. — Ashley Erika O. Jose

What Trump policies could bring for PHL

DONALD J. TRUMP wearing a traditional barong Tagalog during his visit to Manila on Nov. 12, 2017. — REUTERS

By Revin Mikhael D. Ochave, Reporter

UNITED STATES PRESIDENT Donald J. Trump’s recent policy announcements have mixed implications for the Philippines, with potential benefits from lower energy prices due to boosted US oil and gas production but concerns over US inflation and protectionist trade policies that could affect the Philippine economy and its trade relationship with the US, according to analysts.

“President Trump’s orders and announcements that impact US inflation are quite mixed. On the one hand, there are measures designed to ultimately reduce inflation. On the other hand, the proposed 25% tariffs on Canada and Mexico could drive up US inflation since the US imports nearly $900 billion of goods from those countries,” China Bank Capital Corp. Managing Director Juan Paolo E. Colet said in a Viber message.

“A sustained increase in US inflation would very likely push the Federal Reserve into a hawkish policy stance, which could in turn weaken the peso and limit the Bangko Sentral ng Pilipinas’ (BSP) room for interest rate cuts,” he added.

Following his inauguration on Tuesday, Mr. Trump signed a memorandum directing every federal agency to fight consumer inflation. He also hinted that 25% tariffs will be imposed on Canada and Mexico starting Feb. 1.

The local stock market was relatively flat following Mr. Trump’s inauguration.

The bellwether Philippine Stock Exchange index dropped by 0.15% or 9.68 points to 6,340.21, while the broader all shares index fell by 0.07% or 2.62 points to 3,700.24.

AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said Mr. Trump’s focus on oil and gas could be beneficial to the Philippines.

“One thing that stands out is his mandate to boost oil production and lift the export ban on liquefied natural gas (LNG) exports, which should help lower energy prices and translate to lower inflation for us here in the Philippines,” Mr. Garcia said in a Viber message.

One of Mr. Trump’s first-day executive orders (EOs) resumes processing export permits for new LNG projects to boost US energy production.

“This first batch of EOs focused mostly on domestic issues, and we’re not yet seeing details on his planned executive actions that would have significant impacts on the global economy, such as tariffs,” Mr. Garcia said.

Philippine President Ferdinand R. Marcos, Jr. recently signed Republic Act No. 12120 or the Philippine Natural Gas Industry Development Act to develop the country’s natural gas industry.

The Philippines is seeking other sources of energy as the Malampaya gas field, which supplies a fifth of all power generated in the country, is expected to run out of easily recoverable gas by 2027.

Mr. Colet also noted that Mr. Trump’s move to direct federal agencies to investigate US trade practices could be a potential concern for the Philippines.

“He has ordered an investigation into trade practices and deficits, so that is something that should concern us because the Philippines is a net exporter to the US. Hopefully, our special relationship with the US and the relatively small trade deficit they have with us will spare our country from any major tariffs,” he said.

“Trump’s key pronouncements so far are generally in line with market expectations. There’s nothing there yet that is immediately and materially adverse to our country’s economy,” he added.

Meanwhile, COL Financial Group, Inc. Chief Equity Strategist April Lynn Lee-Tan said in a Viber message that the impact of Mr. Trump’s policies on the Philippines will depend on how it affects US bond rates and the dollar.

For his part, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that Mr. Trump’s protectionist policies could lead to higher US inflation.

“More protectionist policies by Mr. Trump could lead to higher tariff rates on imports from China and other countries, while tighter immigration rules could increase US labor costs, all of which would lead to higher overall US inflation,” he said in a Viber message.

Next to Normal returns for a more informed audience

THE rock musical Next to Normal, written by Brian Yorkey with music by Tom Kitt, is often credited as launching the discussion of mental health in mainstream theater back when it premiered on Broadway in 2009.

Next to Normal follows an American family navigating grief. The mother, Diana Goodman, suffers from worsening bipolar disorder that was triggered by a loss in the family. Her illness also affects the lives of her husband Dan and her children, Natalie and Gabe.

The late theater director Bobby Garcia brought the musical to the Philippines in 2011, its Asian premiere. It starred Markki Stroem, Menchu Lauchengco-Yulo, Jett Pangan, Bea Garcia, Felix Rivera, and Jake Macapagal. It was very well received.

This year, 14 years later, it is The Sandbox Collective’s turn to produce the play. The director, Toff de Venecia, believes that as an exploration of love and resilience, the Tony and Pulitzer-winning Broadway drama will resonate with Filipinos audiences of today, who are now equipped with “the language and capacity to talk about mental health.”

“The last time this was staged here was a short Ateneo blueREP run in 2020 cut short by the pandemic. Before that was Atlantis Productions in 2011. I think it’s time to bring this piece back for new generations like Gen Z. It’s very timely, timeless, and important,” he said at a Jan. 14 press preview of the musical.

Sandbox has been staging mental health-themed plays these last few years — Every Brilliant Thing, Lungs, The 25th Annual Putnam Spelling Bee, Tiny Beautiful Things, and Dani Girl. “Mental health is the core advocacy of Sandbox. There’s always a need to have a platform to talk about it,” said Mr. De Venecia.

A NEW STAGING
Next to Normal stars big names in theater: Shiela Valderrama and Nikki Valdez will be alternating as Diana Goodman, OJ Mariano and Floyd Tena alternating as Dan, Sheena Belarmino and Jam Binay alternating as daughter Natalie, and Vino Mabalot and Benedix Ramos alternating as son Gabe. Omar Uddin and Davy Narciso will share the role of Henry, who falls in love with Natalie, while Jef Flores takes on the role of psychiatrist Dr. Madden.

“The main characters are a family, which is very Filipino. The themes in this musical are universal,” Mr. De Venecia said.

For Ms. Valderrama, the burden of the material was made less heavy by the support of the cast and crew, who were all easy to work with, she said.

“It was cathartic for me to release the darkness,” she explained. “It’s not so much absorbing it but releasing it.”

Making the music feel authentic and real was also key in making this staging Next to Normal different from others, according to musical director Ejay Yatco.

“We did it before with Ateneo blueREP for that one weekend before the pandemic hit. It felt like an unfinished battle for me. Now we have a completely live band, not a synthesized keyboard, so it’s all ‘real.’ I also wanted the music itself to have an arc,” he said.

The choreography will be just as “real,” with choreographer Stephen Viñas saying, “I wanted them to just breathe and create something without really dancing,” when speaking of the actors.

The goal for this staging, which is “radically different”  for “the emotions and performances to carry the show.”

REVISITING THEMES
Next to Normal is relevant for people who may want to overcome their personal mental struggles through the arts.

Mr. Mariano, who plays the steadfast husband who must support his wife while also navigating his own grief, said that it’s good to “always revisit the topic of mental health.”

“I actually lost my parents last year, seven months apart, and I have really bad days. I told Toff it might be too close to home and I might not be able to handle it, but I had the strength to go to the callbacks. I’m lucky to have a support system around me to be able to do this,” he explained.

Playing the enigmatic son Gabe is Mr. Mabalot, who revealed that he has his own struggle, with major depressive disorder. He talked about the importance of “sublimating,” to divert or modify an emotional impulse into something more productive.

“There are times we have to move past it that way, to get to a healthy standpoint so as to not trigger our own traumas,” he said.

In line with the topic of the musical, The Sandbox Collective got The Medical City to sponsor tickets for those with mental illness who would like to watch Next to Normal. They will also be a partner in spreading awareness and being the support that audiences can turn to regarding the mental health struggles depicted.

“In the process of putting things together, we openly talk about mental health issues,” said Mr. De Venecia. “Being transparent makes the result more grounded and real.”

Next to Normal will run from Feb. 1 to 23 at the Power Mac Center Spotlight, Circuit, Makati. Tickets are now available via ticket2me.net. — Brontë H. Lacsamana

The demographic dividend of the Philippines: The Catholic view of marriage

LYNDSEY MITCHELL-UNSPLASH

(Part 8)

We have seen that a widespread culture of materialism and consumerism is a counterforce in the efforts of the developed countries to increase the average fertility rate. The moment individuals get used to considering the cost of having children in terms of a Lexus car, an expensive apartment, a world tour or some other luxury item they have to forego, it would be very difficult to convince married couples to have two or more children or even to get married at all.

Getting married and having children cannot be reduced to a cost-benefit decision based on purely materialistic goods and human pleasures. For example, local governments in China today are cold-calling married women to ask about their plans to have babies and are handing out cash to parents to encourage them to have more than one child. Universities have been asked to introduce so-called love courses for single students. These efforts are all doomed to fail. Decisions about children are fundamentally human ones that necessarily involve the spiritual and moral dimensions of man.

Countries that are desperately trying to reverse the decline in their respective populations and the corollary rapid ageing of the same must turn to a non-materialist or spiritual interpretation of the role of marriage, the family and children in society.

Here, I present the Catholic view of marriage, the family, and children, a world view that includes a belief in God as the Creator of the universe and a Law giver who has issued very concrete decrees about marriage and everything related to this sacred institution. This Catholic view is shared by millions of Muslims and Jews because they are contained in the divine revelations found in the Old Testament which is accepted by the two other religions. Those from other faiths or of no religion alone can arrive at some of these truths by the light of reason alone, albeit with some difficulty.

In the Catechism of the Catholic Church, we read in Number 2331 that “God is love and in himself he lives a mystery of personal loving communion. Creating the human race in his own image…, God inscribed in the humanity of man and woman the vocation, and thus the responsibility of love and communion… God created man in his own image… male and female he created them; He blessed them and said, ‘Be fruitful and multiply’; When God created man, he made him in the likeness of God. Male and female he created them, and he blessed them and named them Man when they were created.”

St. John Paul II elaborated on these points of the Catechism in his famous Apostolic Exhortation entitled “The Family in the Modern World.” He emphasized that the human person was created out of love, and each is called to love within his or her vocation. Marriage and family life are special opportunities to live the vocation of love. The love between husband and wife mirrors the love between Christ and his Church — that is, this love is sacrificial and life-giving. A person’s freedom, far from being restricted by this fidelity, is secured against every form of subjectivism or relativism and is made a sharer in creative Wisdom. Married life is enriched and becomes a family with gift of children. It is clear from these teachings of the Catholic Church that marriage, and the marital act must be open to the possibility of children coming from this union of love. That fact that “love is sacrificial and life-giving” means that married couples must be ready to suffer the discomforts, inconveniences, privations, etc. that come with having children. Only when the majority of a population accept this philosophical (and theological) truth will efforts to arrest the decline in the fertility rate and the rapid ageing of the population succeed.

St. John Paul II elaborates further that the family is more than an economic, biological, and sociological entity. As mentioned repeatedly in the Catechism of the Catholic Church, the family is part of God’s plan for creation and salvation. It is within the family that the human person comes to be whom he or she is and comes to know the living God. Love within the family reveals in a special way the unbounded love of God for humanity. Family love involves four general callings: forming a community of persons; sharing a love which serves life; participating in the development of society; and sharing in the life and mission of the Church in the case of baptized Christians. The family, likewise, helps to morally renew the social order. To bear witness to the inestimable value of the indissolubility and fidelity of marriage is one of the most precious and most urgent tasks of Christian couples in our time. Fortunately, in the Philippines there are a good number of apostolic initiatives of married couples who are committed to these urgent tasks, such as the Couples for Christ, Marriage Encounter, Regnum Christi, Focolare, Education for the Upbringing of Children (Educhild), Parents for Education Foundation (Paref), and many others.

In a summary of the detailed ways of promoting an increase in the fertility rate, the following very concrete measures are suggested to concerned married couples, who should always be at the forefront in efforts of “serving life”: (cf. familylife@diolc.org)

• Spouses are to give themselves totally to each other in the conjugal act by honoring God’s inseparable union of love and life. The love between husband and wife must be fully human, exclusive, and open to new life.

• Serving life includes recognition that contraception and natural methods of family planning are very different. Natural methods invite spouses into dialogue, reciprocal respect, shared responsibility, and mutual self-control.

• Spouses are called to be generous to life.

• Husbands and wives are the first and foremost educators of their children. Parents must recognize that they are primarily responsible for the upbringing of their children. Their role is so decisive that scarcely anything (not even the best teachers, except in the few situations when, with God’s grace, teachers or other persons, for example, decide to adopt orphans or abandoned children) can compensate for their failure in it. This is the mission of the two Philippine NGOs mentioned above, i.e., Educhild and Paref.

• Parents are to create a family atmosphere that is animated with love and reverence for God and others.

• Parents are to teach their children to live a simple lifestyle and recognize that material goods are not as important as people. From a very early age, children must realize the fact that in giving birth to them, their parents had to deprive themselves of many material comforts and luxuries.

• It is the parents’ privilege and duty to share the details of sexuality education with their children in such a way that sex (and their sexuality: womanhood and manhood) is viewed as an enrichment of the whole person and an opportunity to give oneself in the gift of love.

• Parents are to work cooperatively with private and public institutions, maintaining cordial and active relationships with teachers and school authorities. Those in society who are in charge of schools must never forget that the parents have been appointed by God Himself as the first and principal educators of their children and that their right is completely inalienable.

• Serving life also includes caring for those outside the immediate family who are society’s outcasts. Also, from a very early age, children must learn from the example of their parents to care for the poor, the sick, and the abandoned.

It would be futile for public authorities in those countries that are going “extinct,” to use the expression of Elon Musk, to sponsor or promote all sorts of programs to arrest the decline in population without having resort to some religious or spiritual motives. Materialistic or consumerist motivations, as have already been tried in countries like Singapore, South Korea, and Japan (and are being desperately resorted to by Chinese authorities today), will not work. I suggest that these governments make as required reading for their public officials the Apostolic Exhortation of St. John Paul II so that they can be inspired to look for deeper human motivations based on religious or spiritual convictions that are the only ones that can inspire married couples to make the necessary sacrifices to “serve life.”

It may also help for the public authorities to seek some assistance from those Catholics in their respective populations who continue to be faithful to the Teaching Authority of the Church and have not been influenced by the so-called “woke” culture that promotes abortion, same-sex marriage, and other practices that are contrary to “service to life.”

(To be continued.)

 

Bernardo M. Villegas has a Ph.D. in Economics from Harvard, is professor emeritus at the University of Asia and the Pacific, and a visiting professor at the IESE Business School in Barcelona, Spain. He was a member of the 1986 Constitutional Commission.

bernardo.villegas@uap.asia

A Brown investing P2.5B in Misamis Oriental project

MISAMIS ORIENTAL PROVINCIAL INFORMATION OFFICE OFFICIAL FACEBOOK ACCOUNT

A BROWN Co., Inc. (ABCI) is investing P2.5 billion in the construction of a mixed-use complex under a joint venture agreement with the Misamis Oriental provincial government.

The project will be developed in four phases and is part of an integrated master development plan, the company said in a regulatory filing on Tuesday.

ABCI said the first phase of the project covers three components, which include the development and construction of office spaces, a commercial center, a park, and parking facilities.

The final phase of the project will consist of the development and construction of a multilevel mixed-use building with a dormitory.

The company said it will disclose more information on the final terms and conditions of the project once the joint venture agreement is signed.

ABCI is a Mindanao-based company with interests in sectors such as property, power generation, public utilities, and agribusiness.

For the first nine months, ABCI saw a 40% decline in its net income to P290.82 million from P484.50 million the previous year.

Revenue rose by 31% to P1.45 billion from P1.10 billion a year earlier, led by higher sales of real estate units and agricultural goods such as crude palm oil.

The total cost of sales and services likewise increased by 95% to P761.34 million from P390.23 million the previous year due to higher sales.

ABCI shares fell by 1.75% or one centavo to 56 centavos apiece on Tuesday. — Revin Mikhael D. Ochave

BTr fully awards reissued bonds as rates drop on strong demand

BW FILE PHOTO

THE GOVERNMENT made a full award of the reissued 10-year Treasury bonds (T-bonds) it offered on Tuesday at an average rate lower than secondary market levels on strong demand,  with traders also reacting to US President Donald J. Trump’s post-inauguration policy announcements.

The Bureau of the Treasury (BTr) raised P30 billion as planned via the reissued 10-year bonds it auctioned off on Tuesday as total bids reached P93.32 billion or more than thrice the amount on offer.

The bonds, which have a remaining life of nine years and 14 days, were awarded at an average rate of 6.251%. Accepted yields ranged from 6.22% to 6.27%.

The average rate of the reissued papers rose by 36.1 basis points (bps) from the 5.89% fetched for the series’ last award on Dec. 10. This was also 1 bp higher than the 6.25% coupon for the issue.

Still, the average rate was 6.7 bps below the 6.318% seen for the same bond series and 7.5 bps lower than the 6.326% quoted for the 10-year bond at the secondary market before Tuesday’s auction, based on PHP Bloomberg Valuation Service Reference Rates data provided by the BTr.

To accommodate the strong demand seen for Tuesday’s offer, the BTr opened its tap facility window to raise P10 billion more via the bonds at the same average rate.

The T-bonds auctioned off on Tuesday fetched yields lower than comparable benchmarks at the secondary market following Mr. Trump’s inauguration speech, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

T-bond rates were lower than market expectations as Mr. Trump’s speech caused markets to scale back their bets of a hawkish US Federal Reserve, the first trader said by phone.

The Treasury fully awarded its offer as it saw strong demand for the bonds on “improved risk sentiment,” a second trader said in a text message.

Global markets greeted Mr. Trump’s presidency with apprehension on Tuesday in moves that were highly sensitive to headlines over the newly sworn-in president’s plans for trade relations and tariffs in particular, Reuters reported.

US markets were closed for a holiday on Monday, so the first reactions to Mr. Trump’s return to the White House were felt during Asian trade on Tuesday, with European futures also pointing to a lower open.

Just as investors cheered the possibility of a delay in Mr. Trump’s implementation of tariffs following a brief mention of the topic in his inauguration speech, the US president said shortly after that he was mulling imposing 25% tariffs on Mexico and Canada as soon as Feb. 1.

Mr. Trump’s plans for hefty import tariffs have been a key area of focus for financial markets on the view that such policies will stoke inflation and run the US economy red hot again, which would boost the dollar and hurt bonds.

Some investors had expected a swift imposition of tariffs from the moment he took office, so the lack of any concrete moves initially sparked a brief relief rally across stocks and US Treasuries.

The benchmark 10-year US Treasury yield was last 7.1 basis points lower at 4.54%. Yields move inversely to bond prices.

Markets had expected that Mr. Trump would announce trade tariffs via executive orders, raising the prospects for higher-for-longer Federal Reserve policy rates.

The BTr plans to raise P213 billion from the domestic market this month, or P88 billion via Treasury bills and P125 billion through T-bonds.

The government borrows from local and foreign sources to help fund its budget deficit, which is capped at P1.54 trillion or 5.3% of gross domestic product this year. — A.M.C. Sy with Reuters

Books we read in 2024 to prepare us for the future

By Dave Lee, Parmy Olson and Catherine Thorbecke

EARLIER last year I came across a two-frame comic strip that I enjoyed so much I printed it out and taped it to the corner of my desk.

In the first frame, an office worker delightedly tells a colleague: “AI turns this single bullet point into a long e-mail I can pretend I wrote.” In the second, the recipient of that e-mail responds: “AI makes a single bullet point out of this long e-mail I can pretend I read.”

Doesn’t that speak to so much of the current moment? Whether it’s coming from Apple or OpenAI or Google or any number of companies working on AI, the message last year seems to have been that both writing and reading is nothing but a chore, an inconvenience to be solved.

This neglects hundreds of years of human progress, of course, where great writing — even when found in what seem like inconsequential memos — has the power to shape minds, build bridges, and move mountains (with all these cliches I’m starting to sound a bit like AI myself).

One critical component of great writing is a skill I have yet to see any AI demonstrate: deep thought. It’s a quality found in abundance within the books noted in the following list. It’s a carefully curated group of titles that we — Bloomberg Opinion’s three commentators on tech — feel have shaped our thinking.

The brief, like last year, was to recommend reading that provided a bed of knowledge for the key themes we think will define 2025. Ours differs from other lists you might see elsewhere at this time of year in that we focus on relevance rather than recency, though there are new books here, too.

THE EVERYTHING WAR — DANA MATTIOLI, 2024
What happens when a company does incredible things for consumers and terrible things for businesses? Wall Street Journal reporter Dana Mattioli serves up a litany of case studies showing how Amazon.com Inc. earned its ruthless reputation in this book, which is enraging at times. Tech startups eager to work with Jeff Bezos’ Goliath are dumbstruck when after a few meetings, Amazon launches nearly identical products. The company swallows a diaper business by threatening to slash its prices to zero if the smaller firm sells to Walmart, killing that deal. Interviews with countless burned companies show Amazon has often gone beyond hard-nosed dealmaking to something far worse: actions befitting a “mobster,” according to Ms. Mattioli. What’s fascinating about The Everything War is the way Amazon’s customer obsession principle gave it cover to act so unethically, skirting sales taxes so its prices could be lower than anyone else’s and dominating markets. Perhaps that made Amazon’s customers its real product, juiced with deals so the giant could keep growing. Reading this left me with the question, “If America’s trust busters cared more about protecting businesses than protecting consumers, would consumers be better off?” Whatever the case may be, we’ll likely see antitrust regulators from the US and Europe do much more to tackle tech giants like Amazon in 2025. Mattioli’s book explains exactly why they should. — Parmy Olson

POWER AND PROGRESS — DARON ACEMOĞLU AND SIMON JOHNSON, 2023
MIT professor Daron Acemoğlu caught my attention twice this year. First, the economist was one of the key contributors to a compelling Goldman Sachs report that posed awkward questions about whether wild investments in artificial intelligence would ever see a meaningful return — a topic you’ll be hearing a lot about in 2025. Then, he won the Nobel Memorial Prize in Economic Sciences — alongside his co-author, Simon Johnson — for his study of “how institutions are formed and affect prosperity.” That issue is at the very front of my mind as I think and write about AI. Power and Progress, published in 2023, is a hefty historical primer that adds urgent context as today’s AI’s luminaries wave away concerns about job displacement. Yes, tech innovations of the past have created more jobs, not fewer, and society has become prosperous as a result. But it rarely happened organically — far from it. This book is an important examination of how and when workers benefited from increased productivity from new tech and when they very much didn’t. Hint: It’s not when the creators of the technology are allowed to call all the shots. — Dave Lee

GAMBLING MAN: THE WILD RIDE OF JAPAN’S MASAYOSHI SON —  LIONEL BARBER, 2024
I’d been waiting for a chronicle of the stranger-than-fiction life of Softbank founder Masayoshi Son, better known as Masa, and Lionel Barber’s telling did not disappoint. It’s one of those real-life stories that Hollywood writers could only dream of: He was born into a pig-farming zainichi Korean family in post-imperial Japan before becoming the single largest foreign investor in both the US and China. Then there’s the high drama surrounding his investments. Barber largely avoided some of the oversimplifications and stereotypical traps that a lot of writing about Japan falls into. I was left wanting more. But Masa’s story is still being written: He reemerged over the past year to go all-in on artificial intelligence. His exuberance for AI, and his late arrival to the party, could easily become a cautionary tale. You’d think his appetite for risk would temper after becoming one of the biggest losers in the dot-com crash or staining his reputation with the recent WeWork saga. But, as Barber writes, “If you are born in a slum with nothing, losing everything is relative. You just go back to square one. Then, like the Korean slum dwellers in [Masa’s hometown], you build back up.” It’s well worth a read for anyone trying to gain a deeper understanding of what could come next for an individual who has played a pivotal role in shaping the tech sector in Asia and beyond. — Catherine Thorbecke

CODE DEPENDENT — MADHUMITA MURGIA, 2024
A number of years ago, I took an eye-opening trip to Nairobi’s Kibera slum to see firsthand the local operations of Samasource, a San Francisco-based firm that outsourced tech work to developing countries. I met some of the workers earning $1 to $2 a day to do data annotation for a variety of projects, such as self-driving cars or visual search engines. Since then, I’ve always thought of these workers — who have names, lives, and dreams, you know — when tech CEOs talk of “magical” software that “just works.” Madhumita Murgia, a Financial Times journalist (and, full disclosure, a friend and former colleague) explores this world more deeply in her book Code Dependent. Murgia examines how emerging technologies like AI are built, and the root cause of flaws within them, by getting up close and personal with those at the front line of it all. She also examines how these trained algorithms are in turn provided new avenues for exploitation of our identities, bodies, and well-being. It all amounts to what she calls “data colonialism” — the consequences of which we’re only just beginning to comprehend. — Dave Lee

PROJECT HAIL MARY — ANDY WEIR, 2021
As a longtime tech journalist, it’s easy to slip into cynicism about the ways technology promises to make the world better but often ends up creating problems instead. Think smartphone addiction, social media’s stain on our mental health, crypto scams, and so forth. Andy Weir’s novel is a reminder of all the ways human ingenuity can solve huge problems, dare I say it even save the world. Steeped in meticulous scientific details that make the story feel not just plausible but real, Project Hail Mary follows a junior high teacher and former molecular biologist as he finds himself aboard a rocket ship, groggily waking up from a coma to realize he is on a critical mission to another solar system. He must use his expertise and careful, critical thinking to address an array of engineering problems and let’s just say extraordinary new circumstances. It is best not to read much more about the story and let the plot unfold, as I did with no regrets whatsoever. I also recommend listening to the audio book, which is not read but engagingly “performed” by the American actor Ray Porter, whose impressive grasp of international accents made it feel at times as if I was watching a film. I listened to this book while jogging and have never before or since been so motivated to lace up my running shoes. — Parmy Olson

BLOCKCHAIN CHICKEN FARM AND OTHER STORIES OF TECH IN CHINA’S COUNTRYSIDE — XIAOWEI WANG, 2020
To cover China’s tech sector is to be bombarded with statements that paint the entire nation as a “threat”: an existential, adversarial force that the US must hold back. The human rights-flouting track record of the Chinese Communist Party doesn’t help. And US politicians need a bogeyman to blame as much as Silicon Valley needs a rival when trying to fight regulation. This book offered glimpses of a few of the real people, mostly from rural China, whose stories often get lost. When Wang visits the titular poultry farm that uses tamper-proof tech to certify the free-range status of birds for e-commerce shoppers, a villager remarks that there have been lots of news stories of the farm but very few visits. No English-language book about the country can scratch the surface of life there, and the author occasionally veered into seemingly off-course tangents. Part travelogue and part memoir, Wang’s perspective is unlike anything I’ve read. Its themes resonate and take on new significance as the US-China tech war heats up. As a fresh crop of China hawks come into power, it would help for Americans to understand who they are trying to fight against. In an increasingly globalized, tech-driven world, Wang’s writing is a reminder of how interconnected and similar people from the two sides of the globe can be. — Catherine Thorbecke

ALSO ON OUR BOOKSHELVES …
Dave made the unwise decision to read Emily St. John Mandel’s Station Eleven and Cormac McCarthy’s The Road back to back, sending him into a post-apocalyptic funk, though it did at least remind him to be far more grateful for some of the tech he relies upon to live a comfortable life. Likewise, he found Nicola Twilley’s Frostbite, about the origins and complexities of modern-day refrigeration, to be an unexpectedly funny and engaging book. Speaking of The Road, Parmy found an even bleaker book in Prophet Song, Paul Lynch’s Booker-Prize winning novel that looks at what happens when propaganda dominates our information ecosystem. She also recommends Co-Intelligence by Ethan Mollick, an excellent explainer on generative AI by a Wharton professor who plays with it every day. Catherine reread Kazuo Ishiguro’s 2021 novel Klara and the Sun this year and was shocked at how prescient the topic of a chronically ill, lonely teenager finding companionship with an “artificial friend” was today. She was excited to hear that it is being turned into a film, expected to be released in the new year, from one of her favorite directors, Taika Waititi.

Dave Lee is Bloomberg’s US technology columnist, based in New York. Parmy Olson covers AI and the tech industry from London and is the author of Supremacy, just named the Financial Times book of the year for 2024. Catherine Thorbecke is Bloomberg’s Asia tech columnist, based in Tokyo.

BLOOMBERG OPINION

Japan and the Philippines: Similar challenges and a shared commitment to peace

PRESIDENT Ferdinand Romualdez Marcos, Jr. welcomes Japanese Foreign Minister Iwaya Takeshi on Jan. 15 at the President’s Hall, Malacañan Palace, Manila. — YUMMIE DINGDING/PPA POOL

More than a week after hearing the lecture of a China studies expert on what will likely take place this year in the West Philippine Sea (WPS), I cannot help going back to the events of 2024 and affirming that this is indeed how things are shaping up.

During last week’s forum on the strategic cooperation between Japan and the Philippines, organized by The Stratbase Institute in cooperation with the Embassy of Japan in the Philippines, Dr. Shin Kawashima of the University of Tokyo said that China will continue its aggressive operations in the WPS as well as in the Senkaku Islands and Taiwan throughout 2025.

“China will not stop their operations. Maybe they will slow down temporarily but from a long-term view, China will not stop, especially given their strong strategy to go beyond the First Island Chain,” he said.

He added that China will take its cue from how the new Trump administration — inaugurated this week — conducts itself and whether it will adopt a soft or hard approach. Whatever the manner, all this is in congruence with the so-called China Dream of Chinese Premier Xi Jinping. It will be in pursuit of the unilateral creation of a new world order by challenging the existing order, as a result of fundamental disagreements with the United Nations, international law, Western values, and the US-led security alliance.

It is not at all difficult to imagine this direction given the events that transpired in our territory in 2024. China escalated tensions through actions like military-grade laser targeting and ramming Philippine Coast Guard vessels and swarming the Senkaku Islands with Chinese government ships. Additionally, in the same year, over 3,000 Chinese military aircraft breached Taiwan’s Air Defense Identification Zone, setting another new record.

During the forum, Japanese Ambassador to the Philippines Endo Kazuya also talked about the many reasons why Japan and the Philippines have to take their relationship to a new level.

“Regional deterrence has never been more critical to ensuring peace and stability of the region. As Japan and the Philippines face similar maritime challenges, we as national and key strategic partners are not only responding to the evolving complexities of regional security, but also building a framework that supports long-term stability and growth. In addition to security, our two countries also have strong economic complementarities,” he said.

The two countries must redouble their current efforts, he said, to face the severe and complex security challenges. Like the Philippines, Japan has demonstrated its commitment to a peaceful resolution of disputes.

Just last month, the Philippine Senate unanimously ratified the Reciprocal Access Agreement (RAA) between the Philippines and Japan. The RAA strengthens cooperation between the Armed Forces of the Philippines and the Japan Self-Defense Forces, facilitating joint exercises like Balikatan, Kamandag, and Sama-Sama.

The RAA, which eases the entry of equipment and troops for combat training and disaster response, will allow both military forces to deploy on each other’s soil. This is the first such agreement that Japan has signed in Asia.

At this crucial juncture in our contemporary affairs, we are fortunate to have leaders who are more engaged than ever and more actively participative in dialogue. They are open to new agreements and committed to forging partnerships that strengthen collective efforts in addressing regional threats.

In fact, this administration has the burden of undoing the harmful consequences of its immediate predecessor’s licentious policy toward China, which was on full display for six full years. We are also fortunate that like-minded countries like Japan are willing to extend more than cooperation but genuine friendship. Furthermore, we are able to strengthen our own capabilities against threats to our integrity, and on a broader scope, to uphold peace and stability in the Indo-Pacific region.

The Philippines, Japan, or any country in the world for that matter, or any bloc or organization, have no control over China’s national aspirations and visions of its future. If it sees itself as a formidable world power, or disrupting the existing rights-based international order, one that is based on the respectful acknowledgment of each country’s rights, then it can try to portray itself as such. Where the rest of the Indo-Pacific region can do something is in responding peacefully, diplomatically, and yet firmly and robustly, to its provocative actions.

Deep and lasting cooperation, like the one enjoyed and treasured by the Philippines and Japan, is crucial to ensuring a future of peace and security in our respective countries and in the Indo-Pacific region. Thus, while we expect more challenges arising from China’s actions this year, we will also take comfort in the fact that we are aligned with nations and peoples who share our values and commitment to what is right and just.

We celebrate the RAA and the resounding message it carries — that the Philippines and Japan will stand resolute in the Indo-Pacific region, undeterred by those who seek to challenge the established order. But we also celebrate the friendships and alliances with countries with whom we share challenges, yes, but moreover an unwavering determination to uphold peace, stability, and the rule of law.

 

Victor Andres “Dindo” C. Manhit is the president of the Stratbase ADR Institute.

Honda eyes up to 5% sales growth in 2025

BW FILE PHOTO

By Justine Irish D. Tabile, Reporter

HONDA Cars Philippines, Inc. is targeting a 3%-5% growth in sales this year amid new product launches and new dealerships, its president said.

“For 2025, maybe around 3%-5% growth in sales,” Honda Cars President Rie Miyake told reporters on the sidelines of a press event late Monday.

“It’s already over 15,000 for 2024, so basically for 2025, we are aiming to align with the market growth. So, definitely, we are going to exceed the result in 2024 this year,” she added.

In 2024, Honda Cars sold 15,518 units, representing 3.32% of the total industry sales.

This reflects a 6.8% decline from the 16,645 units the company sold in the previous year.

“Our practical and stylish seven-seater, the BR-V, has maintained its status as the best-selling model with over 5,000 units sold,” she said.

The BR-V was followed by the Civic, which had over 3,000 sales, and the CR-V, which had around 1,800 sales.

For 2025, she said that the growth will be driven by the new models and the new dealership stores that the company will be rolling out this year.

“We already introduced the HR-V hybrid model today. For the succeeding years, our direction is to expand the hybrid models. Today, I cannot mention any specific models or timing, but our direction is always to shift to hybrid,” she said.

“Considering the current market situation, we think that the hybrid model is the best solution for Filipino customers to contribute to carbon neutrality. So our direction is to bring in more hybrid models,” she added.

On Monday, Honda Cars unveiled its third hybrid model in the Philippines, the HR-V e:HEV. This will be the third hybrid model that the company is launching in the Philippines.

“You have helped us deliver almost 1,200 units of the CR-V e:HEV, showing our customers’ acceptance of our hybrid products,” said Ms. Miyake.

“We initially launched that in September 2023, and since then we have sold almost 1,200 units. In the last two years, the market for hybrids has rapidly grown,” she added.

Meanwhile, she said that the company is adding four new dealerships this year, which will bring the company’s store portfolio to 42.

“We will continue to expand our dealer network, bringing Honda products closer to customers all over the country,” she said.

“In 2025, we plan to inaugurate four new dealerships, namely Honda Cars Talisay, Honda Cars Manila Bay, Honda Cars Tacloban, and Honda Cars Parañaque.”

Asked about how the proposed merger between Honda and Nissan will affect the company’s local operations, she said, “This news sounds like it’s already decided, but actually it’s just the start of the discussion.”

“Nothing specific yet is decided. But if it happens, maybe the impact of the merger on the Philippine market is supposed to be very positive,” she said.

“Because if it happens, the objective is how we can maximize the capability of the development of battery EVs (electric vehicles) or software-defined vehicles. So the impact must be positive, but nothing is decided yet,” she added.

RCBC sets issuance of 5-year dollar-denominated sustainability notes

RIZAL COMMERCIAL Banking Corp. (RCBC) is set to raise fresh funds via five-year dollar-denominated unsecured sustainability notes that will be issued next week.

“Rizal Commercial Banking Corp. has announced terms for US dollar unsecured Reg sustainability notes due 2030,” the Yuchengco-led bank said in a disclosure to the stock exchange on Tuesday.

“The notes will be listed on the Singapore Exchange Securities Trading Ltd. The pricing is expected during European trading hours today.”

The announcement follows a series of investor calls held by the bank on Monday to market the issue.

The benchmark-sized issuance has a tenor of five years and one day and will carry a fixed-rate coupon payable semi-annually.

The initial price guidance was set at 145 basis points (bps) above the five-year US Treasury yield.

The notes will be offered at minimum denominations of $200,000 and increments of $1,000.

They will be issued on Jan. 28, RCBC said.

“The net proceeds from the issue of the notes will be applied by RCBC to support and finance and/or refinance the RCBC’s loans to customers or its own operating activities in eligible green and social categories as defined in RCBC’s Sustainable Finance Framework,” the bank said.

RCBC appointed ING Bank N.V.-Singapore Branch, Morgan Stanley & Co. International plc and SMBC Nikko Securities (Hong Kong) Ltd. as the joint bookrunners for the offering.

Allen Overy Shearman Sterling LLP was appointed as international legal counsel, while Romulo Mabanta Buenaventura Sayoc & de los Angeles is the domestic legal counsel. P&A Grant Thornton was also tapped as the auditor for the offer.

The dollar-denominated sustainability notes will be issued out of RCBC’s $4-billion medium-term note (MTN) program.

RCBC in October upsized its MTN program from $3 billion. Its last issuance under its offshore fundraising program was made in January 2024, when it raised $400 million from an offering of five-year senior unsecured sustainability notes. That issue marked RCBC’s return to the overseas debt market after over three years.

RCBC Chief Executive Officer Eugene S. Acevedo in November said the bank is looking to tap both the foreign and domestic debt markets on a regular basis as part of their new funding strategy to maintain a steady supply of papers.

The bank’s net income decreased by 37.01% to P1.77 billion in the third quarter of 2024. This brought its net profit for the first nine months of 2024 to P6.22 billion, 31.12% lower year on year.

RCBC shares closed unchanged at P24.05 each on Tuesday. — A.M.C. Sy