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PHL peso bond market growth slows in fourth quarter

THE growith of the market for peso bonds slowed in the fourth quarter to 5.3% against 8.8% a quarter earlier, as the government eased off on borrowing while corporate activity in the market declined, the Asian Development Bank (ADB) said.

According to the March issue of the ADB’s Asia Bond Monitor report released Friday, the peso bond market was valued at P8.568 trillion.
On a year-on-year basis, growth in the quarter was 28.9%, against the 21.5% rise in the third quarter.

“The slower growth was driven by a slowdown in the government bond segment combined with a contraction in the corporate bond segment,” the report read.

The bond market consists of 81.2% government securities and 18.8% corporate bonds.

Outstanding government bonds amounted to P6.956 trillion at the end of 2020, up 7% from the end of September and up 35.3% year-on-year. In the three months to September, the quarter-on-quarter growth rate had been 10%.

The government also owes P220 billion to the central bank to help fund its pandemic containment program.

The Bangko Sentral ng Pilipinas (BSP) approved on Dec. 28, 2020 another P540 billion loan to the government, the third time the central bank has made such a loan. The central bank can lend up to P850 billion to the government according to current law.

“Growth in the outstanding stock of government bonds dropped primarily due to a contraction in issuance of treasury and government bonds; the government issued a fairly large amount of Retail Treasury Bonds in Q3 2020,” the ADB said.

Meanwhile, the corporate bond segment declined 1.3% quarter-on-quarter to P1.612 trillion due to debt maturities and lower issuances.

Year-on-year, outstanding corporate securities rose 7.1%, against a year-earlier growth rate of 14.5%.

Banks took up 43.7% of the corporate bonds issued.
“Quarter-on-quarter bond issuance growth was driven solely by central bank bonds, which rose more than 1,000% as the central bank sterilized foreign capital inflows. Q4 2020 bond issuance was still higher compared to pre-pandemic levels due to the need to fund stimulus measures,” the ADB said.

Across emerging East Asia, the Philippine bond market was the third-fastest growing on a quarter-on-quarter basis, after Vietnam’s 8.1% growth and Indonesia’s 10%. — Beatrice M. Laforga

Shares snap out of rally on higher COVID-19 infection rate

Philippine stocks on Friday closed in the red a day after the country reported a record high coronavirus disease 2019 (COVID-19) infection rate and dampened investor sentiment.

The 30-member Philippine Stock Exchange index (PSEi) declined by 36.37 points or 0.55% to close at 6,544.63 on Friday, while the broader all shares index went down by 9.04 points or 0.22% to 3,967.79.

“Market went on profit taking [on Friday] as [a] new record high COVID-19 infection rate was reported [on Thursday. This] may prompt the government to maintain or apply stricter restrictions so as to contain the spread of the virus,” Diversified Securities, Inc. Equity Trader Aniceto K. Pangan said in a Viber message.

Philstocks Financial, Inc. Research Associate Claire T. Alviar said in a separate Viber message that negative sentiment “spilled over” after the country recorded its highest COVID-19 single-day tally.

The Health department reported a 16.1% COVID-19 infection rate on Thursday, logging an additional 8,773 cases. The daily tally brought the number of total COVID-19 infections in the country to over 693,000.

Juanis G. Barredo, chief technical analyst at COL Financial Group, Inc., said the market “corrected,” after three consecutive days of posting gains.

“Rallies in the previous days had come with sparse volumes and this still shows tenderness in demand,” Mr. Barredo said in a separate Viber message.

The sectoral indices were split on Friday. Holding firms decreased by 58.34 points or 0.87% to 6,605.40; financials fell by 10.55 points or 0.74% to finish at 1,401.64; and services declined by 9.23 points or 0.63% to 1,435.98.

Meanwhile, mining and oil improved by 177.22 points or 2.09% to 8,633.94; industrials rose by 19.67 points or 0.22% to 8,590.72; and property inched up by 3.43 points or 0.1% to close at 3,276.96.

Value turnover went down to P6.28 billion with 4.91 billion shares switching hands from P6.10 billion with 2.49 billion issues traded on the previous trading day. Advancers outperformed decliners, 101 against 92, while 49 names closed unchanged.

Net foreign selling declined to P724.71 million on Friday from the P783.51 million seen on Thursday.

COL Financial’s Mr. Barredo said the index still needs to “recoup” over its 6,700 to 6,800 resistance.

“Unless this happens, this rally could simply be temporary, part of its regular cascade within a reactive trend. Support is seen between 6,400 and 6,250,” he said. — Keren Concepcion G. Valmonte

Peso little changed after Monetary Board meeting

The peso closed little changed Friday after the Monetary Board kept benchmark interest rates steady at record lows.

The peso closed at P48.49, against its P48.58 finish Thursday, according to the Bankers Association of the Philippines.

The currency strengthened from its week-earlier close of P48.62.

The peso opened the Friday ession at P48.55. Its low was P48.585 while its high was P48.48.

Dollar trading volume rose to $740.8 million from $691.29 million a day earlier.

“The peso was nearly unchanged after the BSP decided to keep its policy rates unchanged during its meeting this week,” a trader said via e-mail.

In its second policy-setting meeting on Thursday, the Monetary Board kept the overnight reverse repurchase rate at an all-time low of 2%, in line with the expectations of 19 economists polled by BusinessWorld last week. Rates for the overnight lending and deposit facilities were also maintained at 2.5% and 1.5%, respectively.

The peso hit its strongest level in two weeks Friday as investors awaited the signing of a bill that will lower the corporate income tax rate, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.

The Corporate Recovery and Tax Incentives for Enterprises (CREATE) bill, which also aims to streamline fiscal incentives, is now awaiting President Rodrigo R. Duterte’s signature. If left unsigned, the bill will lapse into law on March 27.

“The peso was also stronger ahead of the arrival of more COVID-19 vaccine shots: one million from Sinovac and 979,200 from AstraZeneca,” Mr. Ricafort added.

The expected increase in remittances from overseas Filipino workers ahead of the Easter holidays may have supported the peso as well, he said. — Beatrice M. Laforga

Taiwan, U.S. to strengthen maritime coordination after China law

TAIPEI – Taiwan and the United States have signed their first agreement under the Biden administration, establishing a Coast Guard Working Group to coordinate policy, following China’s passing of a law that allows its coast guard to fire on foreign vessels.

The new government of U.S. President Joe Biden has moved to reassure Chinese-claimed Taiwan that its commitment to the island is rock solid.

The defacto Taiwanese ambassador to the United States, Hsiao Bi-khim, signed the agreement in Washington on Thursday, her office said in a statement.

“It is our hope that with the new Coast Guard Working Group, both sides will forge a stronger partnership and jointly contribute even more to a free and open Indo-Pacific region.”

U.S. Acting Assistant Secretary of State for East Asian and Pacific Affairs Sung Kim was at the signing ceremony, the office said.

The American Institute in Taiwan, which handles U.S. ties with the island, said the United States supported “Taiwan’s meaningful participation and contributions to issues of global concern, including in maritime security and safety”.

Taiwan is upgrading its coast guard with new ships, which can be drafted into naval service in the event of war, as the island deals with increasing encroachments from Chinese fishing boats and sand dredgers in Taiwan-controlled waters.

While the United States, like most countries, has no formal diplomatic ties with Taiwan, it is the island’s most important international backer and arms supplier.

China passed a law in January that for the first time explicitly allows its coast guard to fire on foreign vessels, causing concern regionally and in Washington. China has rebuffed those worries.

Taiwan Premier Su Tseng-chang said on Friday China’s new law had shocked the region and that those with “common values” needed to work together to protect peace.

“This unilateral request for the coast guard to use force will cause great tension and pressure on neighbouring countries,” he told reporters.

China also has maritime sovereignty disputes with Japan in the East China Sea and with several Southeast Asian countries in the South China Sea. – Reuters

Myanmar sees more protests as World Bank warns of economic slump

Myanmar anti-coup protesters staged more rallies on Friday after the military reportedly shot dead nine people a day earlier and as the World Bank warned the country’s economy could slump 10% this year due to the turmoil.

In a bid to increase pressure on the junta over the Feb. 1 coup, the United States and Britain imposed sanctions on conglomerates controlled by the military, with Washington calling it a response to the military’s “brutal repression”.

Candle-lit protests took place across the country overnight including in the Mandalay and Sagaing regions, as well as in Karen and Chin states, media reports said

In Myanmar’s second city of Mandalay, protesters marched on Friday morning in front of a “civil disobedience movement” banner, Mizzima news reported.

Myanmar has been rocked by almost daily protests since the army overthrew Aung San Suu Kyi’s elected government and installed the junta. Suu Kyi, who won the Nobel Peace Prize in 1991 for her campaign to bring democratic civilian rule to Myanmar, and other members of her National League for Democracy (NLD) are being held in detention.

At least 320 people have been killed in the subsequent crackdown, according to figures compiled by the Assistance Association for Political Prisoners (AAPP) activist group.

The World Bank on Friday slashed its forecast for Myanmar’s economy to a 10% contraction in 2021 from the growth expected previously.

Myanmar “has been heavily affected by protests, worker strikes, and military actions; reductions in mobility; and the ongoing disruption of critical public services in addition to banking, logistics, and internet services”, it said.

 

U.S., BRITISH SANCTIONS

In Washington, the U.S. Treasury Department announced new sanctions targeting Myanma Economic Holdings Public Company Limited and Myanmar Economic Corporation Limited.

Both are part of a military-controlled network which spans sectors from mining to tourism and has enriched the generals. Representatives for the two entities had no immediate comment.

“These actions will specifically target those who led the coup, the economic interests of the military, and the funding streams supporting the Burmese military’s brutal repression,” U.S. Secretary of State Antony Blinken said in a statement.

In a move coordinated with the United States, former colonial power Britain said it would also target Myanma Economic Holdings Ltd, citing human rights violations against civilians and its association with senior military figures.

The European Union announced sanctions on 11 individuals on Monday and is expected to target the conglomerates soon.

But although many foreign governments have condemned the military’s actions, Thomas Andrews, special U.N. rapporteur on human rights in Myanmar, said the diplomatic response was slow and called for an emergency summit on the crisis.

 

ARMY DAY

The AAPP recorded nine deaths of protesters at the hands of the security forces on Thursday.

Other media outlets reported at least seven protesters were wounded when security forces opened fire in various places. Reuters could not independently verify the reports.

The military was trying to stifle protests before Armed Forces Day on Saturday, the AAPP said.

The day commemorates the launch of armed resistance against Japanese occupation in 1945 and typically involves military parades through the capital Naypyitaw.

A military spokesman did not respond to calls seeking comment.

Residents said that after dark on Thursday, soldiers raided Yangon’s Mingalar Taungnyunt district and arrested people on the streets after curfew. Residents heard bangs that could be either stun grenades or gunfire, they said.

One resident said soldiers had shot at his building every night this week and checked houses they deemed suspicious.

“Even if they find nothing, they take everything they want,” he told Reuters.

The junta has tried to justify the takeover by saying a Nov. 8 election won by Suu Kyi’s NLD was fraudulent – an accusation the electoral commission has rejected. Military leaders have promised a new election but have not set a date and have declared a state of emergency. – Reuters

The smart locker network concept comes to the Philippines

A unique concept has come to the Philippines to fulfill the need for contactless delivery and safe storage during this time of the pandemic. 

The smart locker service has become extremely popular in Asian countries. Very soon, the QUBE Smart Locker powered by Box24 will be installed in various locations such as DMCI Homes, MyTown Co-Living, Serendra under Ayala Malls, and many more pilot locations within the metro.

Elcid Lao, CEO of LAUNDRAFÉBox Corporation—the company behind QUBE Smart Locker— expounds, “QUBE Smart Locker is a brand-new service provider and system on its own. It is the first smart locker system in the Philippines. We are confident that Filipinos will embrace it as the concept offers a graceful start in innovative technology.”

By downloading the Box24 app, clients are entitled to 24/7-access to smart lockers that can be used for a variety of drop-off and pick-up services such as laundry, logistics, storage, bills payment, and shopping. 

Clients can enjoy the convenience of having a personal locker that is near their own residence or workplace. The contemporary service also allows parcel pick-ups during the client’s preferred time without worrying whether the building staff has received it or not. Most of all, the smart locker totally eliminates the precarious face-to-face encounters associated with delivery of parcel and goods. New users are also entitled to a Php. 150.00 off on their first transaction by using the promo code NEW150. This promo code is available for one-time use only and exclusively for first time users.

Cid underscores the contactless features of QUBE smart locker by saying, “The smart lockers are 100% cashless. Clients can pay online through the mobile application available on Android and iOS. Thus, the smart lockers ensure safety against the exposure to COVID-19 or other contagious diseases.” 

The QUBE smart locker runs 24 hours a day and 7 days a week. A barcode scanner is installed within the smart locker for enabling the QuickPin. Clients or courier riders would retrieve this one-time QuickPin through the digital monitor to open the locker and access its contents. 

Thanks to the contactless payment technology powered by 2C2P, clients can pay for the services through the app itself or the smart locker via debit card, credit card, GCash and PayMaya.

The world has certainly embraced the smart locker lifestyle. In Thailand for instance, the smart locker network includes around 200 condominiums and buildings. Customers who are loyal to the service appreciate the convenience of having the ability to order and pick up their purchases from the locker at any time. Likewise, online sellers declare that they enjoy the ease of sending off orders at their most convenient business hours and hassle-free logistics. 

The potential satisfaction extends beyond the users of the app. QUBE powered by BOX24 welcomes entrepreneurs and building owners who would like to set up the smart locker in a space with high traffic such as condominiums, office buildings, or even malls. The QUBE smart locker has various features that make it an attractive business option. 

It is electricity operated; once plugged into an outlet, the smart locker is instantly operational. QUBE smart locker is powered by 5G unlimited Internet data so that connectivity to the Internet is smooth and seamless, even in areas that are considered as “dead spots.” The smart locker also has an auto-shutdown feature that prevents it from being opened when it has been moved or tampered with. Customers and smart locker owners can have the peace of mind that their property is safe from theft or damage. 

What’s more; the QUBE smart locker is touch screen operated, which enables business partners to display ads in the smart locker monitor. 

As restrictions are being lifted, and commerce, tourism, and other activities are slowly re-starting amidst the threat of COVID-19, Cid sees QUBE as an essential service.  He reiterates, “This pandemic is nothing but a time of health uncertainty. Even though many individuals practice health protocols in order to stay safe, staying at home encourages our citizens to adjust to a new normal by purchasing items and ordering food from the safety of their own home. Hence, smart lockers can definitely ensure contactless transactions to secure the idea of safe buying and moving for every Filipino utilizing online shopping service.”

To download the app, go to the App Store for iOS or Google Play for Android and search for BOX24 or scan the QR code below! Once downloaded, tap on “sign up” and provide the necessary details. After signing up, tap on the service that you desire: Wash for laundry, Drop for personal storage, Pay for payments, Shop for e-commerce and online shopping, and Go for parcel movement and delivery. Visit QUBE on Facebook (facebook.com/qubesmartlockers), Instagram (@qube_24.7) and Twitter (@qubeph) for updates and more details. 

India and Saudi Arabia spar over oil prices

Disclaimer: John Kemp is a Reuters market analyst. The views expressed are his own.

LONDON – Tensions this month between India and Saudi Arabia over rising oil prices have underscored the growing importance of the bilateral relationship and its potential to generate conflict as well as cooperation.

The decision by OPEC+, the Organization of the Petroleum Exporting Countries and its allies, at the start of this month to leave output unchanged despite a near doubling of oil prices since the start of November sparked an angry exchange of words.

“The decision by OPEC+ has saddened us. It is not good news for India, China, Japan, Korea and other consuming nations,” India’s minister for petroleum told Reuters earlier in March.

“We have asked companies to aggressively look for diversification. We cannot be held hostage to the arbitrary decision of Middle East producers,” an Indian government source said. (“India asks refiners to diversify, cut reliance on Middle East oil after OPEC+ decision”, Reuters, March 9)

In response, Saudi Arabia’s energy minister said India should first use the stocks of crude it bought cheaply during the price slump in 2020.

In practice, there is too much at stake for both countries to permit the disagreement to poison the overall relationship (“The global implications of India’s oil spat with Saudi Arabia”, Financial Times, March 25).

Saudi Aramco has reportedly maintained supplies to India’s refiners in April, even as it cut loadings for other parts of Asia, a sign the kingdom is keen to dial down the disagreement.

But the dispute underscores how dependent both countries have become on each other in petroleum trade, and the increasing potential for disagreements about what constitutes a fair price.

 

MUTUAL DEPENDENCE

In 2019, the last year before the COVID-19 pandemic disrupted global trade, Saudi Arabia was the second-most important supplier of merchandise to India, while India was the second most important destination for Saudi exports (https://tmsnrt.rs/31jvIOM).

In both cases, the top trade partner was China, according to data compiled by the International Monetary Fund (“Direction of Trade Statistics”, 2021).

But merchandise trade between the two countries was very unbalanced, with Saudi Arabia exporting around $27 billion to India, while importing only around $6 billion in return.

As a result, Saudi Arabia accounted for India’s second-highest trade deficit (after China), while India accounted for Saudi Arabia’s second-highest trade surplus (again after China).

Given that bilateral trade is dominated by petroleum, sharp increases in the oil price have the potential to widen the imbalance significantly.

More broadly, the Arab Gulf States, including Iraq, Kuwait, Oman, Qatar and the United Arab Emirates, collectively account for more than 20% of India’s total import bill, mostly in the form of oil and gas.

India is heavily reliant on imported oil and gas from the Gulf and the rest of the world, so oil prices are a major source of pressure on the balance of payments and the domestic economy.

The country relies on imports to satisfy almost 85% of its oil consumption and 55% of its gas, according to BP (“Statistical Review of World Energy”, 2020).

The Saudi-Indian dependency is mutual. India has become the second most important market for Saudi oil exports – after China but slightly ahead of Japan and South Korea.

India and China are expected to provide almost all the marginal increase in global oil consumption over the next few years as more mature markets in North America, Europe and Northeast Asia stagnate or decline.

India will therefore become increasingly critical for oil exporters. Saudi Arabia has been keen to forge strategic relationships with India’s refiners and fuel distributors to secure preferential access to one of the largest and fastest growing downstream markets in the world.

 

PETROLEUM POLITICS

History since the World War Two suggests mutual dependency will not prevent serious price disagreements between exporters and importers over what constitutes a reasonable oil price.

Between the 1970s and the 2000s, when the major flow of Middle East oil was to Europe and the United States, the main disagreements were between Saudi Arabia/OPEC and importers around the North Atlantic.

In the last two decades, reduced oil consumption in relation to GDP, increased fuel taxes, and the U.S. shale revolution have lessened European and U.S. vulnerability to price changes originating from the Middle East.

Managing diplomatic and commercial relationships with the United States and Western Europe was a top priority for Saudi Arabia and OPEC.

But now the major impact of price changes is felt in Asia, especially India and China, these relations will demand greater commercial, diplomatic and political attention. – Reuters

A better understanding of digestive cancers

Advanced diagnosis and treatment of digestive cancers highlighted in recent BusinessWorld Insights webinar

While cancer is known to potentially strike one’s heart or lungs, it can also attack within one’s digestive system, including the liver, gallbladder, bile duct, and pancreas.

In fact, according to data from World Health Organization, colorectal and liver cancers are among the top five cancers in the Philippines. World Cancer Research Fund, meanwhile, noted that cancer in the digestive system is the fourth common type of cancer occurring in men and the seventh most commonly occurring cancer in women.

No wonder digestive cancers should be another area of concern for many with regards to cancer, and taking care of our gut should not be overlooked.

Last March 10, BusinessWorld, in partnership with Mount Elizabeth Hospital and Parkway Cancer Centre (PCC), held a webinar that gathered cancer specialists from Singapore to discuss digestive cancers as well as the latest breakthroughs in diagnosing and treating these diseases.

Digestive cancer in brief
According to Dr. Foo Kian Fong, Senior Consultant in Medical Oncology at PCC, the risk factors of digestive cancers include age, genetic factors, family history, and underlying conditions. There are also lifestyle factors, such as alcohol, obesity, high-fat diet, smoking, physical inactivity, and lack of sleep.

For liver cancer, in particular, risk factors include hepatitis B or C; liver cirrhosis or hardening of liver; a fatty liver; and hereditary hemochromatosis or the overabsorption of iron.

According to Dr. Chua Tju Siang, Senior Consultant Gastroenterologist at Mount Elizabeth Hospital, digestive cancers hardly have symptoms in their early stages. These can be limited to gastric discomfort, stomach pain, or even change in bowel habits (e.g., from once a day to thrice in two weeks). Digestive cancers become more apparent when pain is already being felt.

“For liver and pancreatic cancers, jaundice is a problem, wherein the obstruction of the bile duct leads to the yellowing of the skin and the eyes,” Dr. Chua said, adding that suggested weight loss not assisted by any regimen and swallowing with pain can be other symptoms for advanced digestive cancers.

Briefing about pancreatic and gastroenteropancreatic neuroendocrine tumors (GEP-NETs), Dr. Liau Kui Hin, Senior Consultant Surgeon at Mount Elizabeth Novena Hospital, pointed out that the pancreas consists of two types of organs — one to aid in digestion and the other to regulate body functions/metabolism. Both functions can be compromised when cancer enters either organ.

“Majority of cancer we see, about 90%, come from the mother cells that produce digestive juice, or the organ that is responsible for digestion. This is called adenocarcinoma,” Dr. Liau explained. “The other type of cancer, which we call neuroendocrine tumor of the pancreas, is a tumor whose mother cell comes from neuroendocrine cells.”

Advanced diagnosis
Like any type of cancer, successful treatment of digestive cancers require an effective diagnosis; and recent advances in diagnostic methods have improved accuracy.

Endoscopy, a method usually used for diagnosing the digestive tract, esophagus, colon, and stomach has extremely advanced, Dr. Chua noted, with 4K scopes and zoom scopes providing clearer views.

There is also endoscopic ultrasound that improves the diagnosis in the pancreas, gallbladder, and bile duct which are in an area found difficult to obtain a biopsy. “[T]his helps us evaluate the pancreas, especially if we see mass, we can take biopsy and confirm that this is indeed pancreatic cancer or not,” the gastroenterologist added.

Aside from endoscopic diagnoses, other advanced procedures include endoscopic submucosal dissection, which can remove stomach cancer from the surface and hence preserve the organ; and endoscopy for palliation, which can deal with pancreatic cancer when it obstructs nearby organs.

Dr. Chua noted that Mount Elizabeth Hospital in Singapore is very equipped with advanced technology for diagnostic procedures. “Since 2006, we started introducing endoscopic ultrasound. Not so long ago, we’ve upgraded it into a better version,” he said. “[Our technologies] are all very good at producing a [good] environment to carry out these procedures.”

Advanced surgery
Likewise, treatment of digestive cancers has improved with the advancement of surgical techniques. Dr. Liau noted that whereas before, the instruments they used were heavy and cumbersome, now they are using smaller tools and apply advanced techniques such as keyhole surgery — all of which can also be availed at Mount Elizabeth Hospital.

With keyhole or laparoscopic surgery, which is enabled through advancements in miniaturization and nanotechnology, tumors can be better removed while bleeding can be controlled.

“The advancement in surgical technology provides safer operations with improved outcomes in term of lower mortality from the operations and better long term survival rate,” the surgeon added, noting that Whipple operation with mortality more than 20% has since been reduced to less than 3% to 5% in the recent years in centers with experienced pancreatic surgeon.

For Dr. Foo, advanced diagnosis and surgery altogether help in better identifying and, eventually, managing digestive cancers.

“Advances in biomolecular technology help us subtype the different types of cancers, which also helps us in the management. Advances in immunology help us treat patients through immunotherapy and extending their survival,” he added.

Prevention
While there are now improved ways to diagnose and treat digestive cancer, prevention through a healthy lifestyle is nevertheless better, as the doctors stressed.

Dr. Chua noted that foods that may increase the risk of digestive cancers include fatty foods, red meat, and processed meat. The International Agency for Research on Cancer classified processed meat as ‘carcinogenic to humans,’ while red meat was classified ‘probably carcinogenic to humans.’

On the other hand, the gastroenterologist continued, cruciferous vegetables have been shown to reduce the risk of esophageal and colon cancers.

Exercising helps as well, noting that walking or cycling for an hour can reduce one’s risk of colon cancer by about 10% to 15%.

In addition, Dr. Liau pointed out that tackling food safety will also help address digestive cancers as environments are still vulnerable to pollution and so food can get contaminated.

“Majority of the cancers come from the digestive and respiratory systems, and this really impresses on us that we are living in a polluted environment, and the food that we take may not be 100% secure and safe. We need to mitigate some of these risks,” he explained.

For inquiries, please contact Parkway Hospitals Singapore — Manila office located at G/F-B, Marco Polo Hotel, Meralco Avenue and Sapphire Street, Ortigas Center, Pasig City 1600, e-mail manila.ph@parkwaypantai.com or call 0917-526-7576.

Lighting the path to regeneration

The world has completely changed in the wake of the COVID-19 pandemic, one of the worst global crises since the Second World War. Millions of people have been affected, with a death toll of nearly two and a half million worldwide, and millions more losing their livelihoods as a result of the economic catastrophe that followed.

Yet according to many leaders, from the United Nations, the Bill & Melinda Gates Foundation to the International Federation of Red Cross, and Red Crescent societies, things could get much, much worse.

The looming crisis, of course, is climate change.

Philanthropist Bill Gates put it most succinctly: “By 2060, climate change could be just as deadly as COVID-19, and by 2100 it could be five times as deadly.”

If the current crisis is any indication, it is that the world is in dire need of a change, a paradigm shift that puts the good of society and community at the heart of business and policy making.

A champion of change

EDC employees and contractors working on site follow strict COVID-19 protocols to keep them safe as they keep the lights on for our power customers.

For over 40 years, Energy Development Corp. (EDC) has been quietly generating power from geothermal sources, ultimately becoming the Philippines’ leading renewable energy producer and the world’s largest vertically integrated geothermal producer.

But with the time left to mitigate the coming disaster running out, the company has chosen to no longer remain silent.

“We have a responsibility to our planet and to humanity, and we have chosen to take a stand. That stance imposes a duty on us to use our voice to send a distress call to as many people and organizations as possible because we are running out of time,” said Richard Tantoco, EDC president and COO, in a talk on the call to be regenerative that he delivered at the Global Catholic Climate Movement and Focolare Movement’s conference held late last year.

EDC has realigned its business, resources, and capabilities to fulfill a new chosen purpose: to forge collaborative pathways for a decarbonized and regenerative future. Embarking on this path, the company seeks to elevate the environment, its employees, communities, customers, other co-creators, and shareholders to create a wider, more positive impact on the planet.

“While our investors are important, regenerative thinking demands that we look at our business from a wider lens than just profitability,” Mr. Tantoco said.

“The transformation cannot be done by entities working alone. We are mindful that we exist within highly diverse and nested systems, and that we must all play unique, reciprocal, and synchronized roles in a world that needs to be healed. Our collective success will be measured by how quickly we can decouple economic and social prosperity from the destruction of our planet’s life support systems,” he added.

Forging regenerative partnerships

Negros Oriental, through its Governor Roel Degamo (right), was one of the recipients of the RT-PCR machine and RNA Extractors that EDC provided to help the province put up its own COVID-19 testing lab.

Genuine care and compassion is at the heart of EDC’s newfound purpose, as it seeks to create lasting partnerships that would benefit society at large. With its employees, EDC strives to foster a healthy and positive working environment, an effort that was made abundantly more important in light of the COVID-19 pandemic.

While EDC required most of its employees to work from home, the skeletal force that operates its power plants have been provided with all they need to live and work comfortably: good sleeping quarters, appetizing food, and stable internet so they can always get in touch with their loved ones while working on site. Additionally, EDC delivered masks, comfortable office furniture and equipment, and went grocery shopping for their families while they were on duty.

“We even offered to vaccinate all employees and their families against flu and pneumonia to increase everyone’s chances of survival. Majority said yes to this offer. We provided access to counseling services for those who feel the need to take care of their mental health,” Mr. Tantoco added among other initiatives.

While its employee engagement score in 2019 already reached an all-time high for EDC at 91%, which was 3% higher than Willis Towers Watson’s global score, this genuine pampamilyang malasakit resulted in a new high with increased scores in all categories related to key engagement drivers in a quick employee pulse survey that Willis Towers Watson did last year.

“I suspect that the manner in which we care for our employees — which is nothing short of treating everyone as family — is driving these amazing engagement levels,” Mr. Tantoco said.

The same treatment is extended to EDC’s partner communities where the company helped put up their own molecular testing laboratories apart from giving food and medical supplies to medical frontliners and container vans that could be used as quarantine facilities and sleeping quarters for the medical staff on duty to enable them to strengthen their COVID-19 resilience.

Not even masks can hide the big smiles on the EDC SIKAT scholars’ faces as they received free laptops from ASUS Philippines to equip them for distance learning.

Beyond the pandemic, EDC has invested heavily in education programs like its SIKAT Program, where promising students are mentored from high school until they get into the UP college system, all expenses taken care of.

In protecting the environment, of core importance to EDC, the company is continuing its longstanding program of bringing back to abundance 96 of the country’s most endangered native tree species through its BINHI greening legacy program.

“So far, close to 10,000 hectares of degraded and open forests in watersheds have been replanted with endangered indigenous tree species and fruit-bearing trees. Having geothermal reservations as vast as 1% (270,000 hectares) of our country’s total land area made us realize the need to partner with farmers and community associations and inculcate in them the value of environmental stewardship. We enabled them to help us take care of our forests. We incentivized them and helped them transform into our green warriors,” Mr. Tantoco said.

In 2019, EDC was selected by the International Union for the Conservation of Nature (IUCN) through its secretariat, the Botanic Gardens Conservation International (BGCI), to be its first and only local Global Tree Assessment partner in the Philippines as a result of its conservation efforts under BINHI. This year, BGCI has expanded its partnership with EDC to be able to assess the status of more Philippine native tree species. EDC has also hit many regenerative targets thanks to its strong partnership with the UP-Diliman Institute of Biology and the UP-Los Baños College of Forestry and Natural Resources.

Today, EDC’s areas of operation are home to myriads of wildlife species — 291 birds, 43 bats, 25 other mammals, and 46 reptiles and amphibians, with almost half of them endemic to the Philippines.

For its customers, which are electric cooperatives, distribution, utilities, and contestables or businesses with an average electricity consumption of at least 500 kilowatts (kW), EDC has been conducting climate change workshops, and helping them find ways to reduce their own energy consumption, carbon footprint, and losses.

As for EDC’s investors, Mr. Tantoco said: “Thankfully, our shareholders share our mission of decarbonization through clean energy. And we look forward to the long journey ahead in a truly regenerative partnership with them.”

“One of our key insights is this: we know that the issues confronting us are so huge that we need everyone’s help. We will only successfully fulfill our mission if we collaborate with others.”

“This is definitely not a competitive beauty contest. It is not about which company wins the most awards,” he added.

“As our Chairman Piki Lopez keeps stressing, if we find ourselves ahead but alone at the finish line of this massive and humbling undertaking, we will then have failed in our mission,” he said.

For this reason, EDC and the rest of the Lopez group has illuminated the path to regeneration and has made a call for everyone to join them in this journey. Indeed, this daunting task of creating a livable planet for future generations lies not only in their hands but in all of ours. — Bjorn Biel M. Beltran

Outstanding Property Award London 2020 honors Golden Bay Landholdings’ world-class projects

Golden Bay Landholdings wins big at the Outstanding Property Award London (OPAL). OPAL seeks the most exceptional architecture, interior design, and property development projects from around the world. Aspire Corporate Plaza and Garden City was awarded winners in the property development criteria of the critically-acclaimed awarding body. This is the developer’s first international win.

Garden City, OPAL 2020 winner in Property Development Category – Mixed-Use

Golden Bay Landholdings’ COO Jardin Wong shares that he and the rest of his team are elated for the international wins. Mr. Wong reminisces on the rigorous process of perfecting both properties with their architectural partners, ASYA Design and WTA Design Studio. “We all put in the time and the effort to create projects that really go beyond boundaries. We are glad we went through that process. We really took time to understand our projects’ impact on the general environment and community around it,” Mr. Wong states.

Both developments showcase exactly what the OPAL panel was looking for: Outstanding projects addressing creativity, innovation, social impact, and sustainability while creating a unique cross-industry platform that unites experts and talents.

Jardin Brian Wong, Golden Bay Landholdings COO

OPAL’s panel is composed of 29 highly-acclaimed architects, planners, interior designers, and purveyors. They judge the entries based on the project’s own merit and not against other entries. Entries are evaluated on creativity, form, function, and a clear relationship between the environment and end users.

According to OPAL, creativity alone is not enough to take home to be recognized by their panel. “It needs to show useful function and provide a better living experience for its users, meeting the clients’ expectations,” they share. These are elements that are visible in the architectural structure, sustainable design, and overall experience of both Aspire Corporate Plaza and Garden City. 

Mr. Wong points out that the odds of a local boutique developer like Golden Bay winning internationally was unexpected, making the wins even more satisfying. For tenants and partners of Aspire Corporate Plaza and the future residents of Garden City, the choice to invest in a Golden Bay property proves to be a solid investment backed by the distinguished OPAL jurors. “Fastened with our commitment to produce world-class innovation and creativity, Aspire Corporate Plaza and Garden City are not just assets, they are a legacy,” Mr. Wong points out. 

Aspire Corporate Plaza, OPAL 2020 winner in Property Development Category – Commercial, Low Rise

While Aspire Corporate Plaza launched last 2020 and Garden City is still in the works, the OPAL wins show that Golden Bay Landholdings is here to make a mark on the global stage of design and development. Standing tall beside major firms from all around the world, Golden Bay showcases the ingenuity of Philippine talent and architecture. This win is a step forward for aspiring Filipino designers everywhere. 

Mr. Wong shares that he and his team are grateful and honored for the awards but they are certain that this is just the beginning. More award-winning properties are on the drawing board and in the pipeline for Mr. Wong, his team, and his partners. The OPAL win has recharged and inspired them to create more world-class developments for the Philippines.

“Golden Bay Landholdings will continue to dream of exceptional projects that addresses social impact, environmental protection, inclusiveness, and real world purpose,” Mr. Wong shares.

 

 

 

BSP holds policy rate at record low

By Luz Wendy T. Noble, Reporter

THE Philippine central bank left its key interest rate unchanged at a record low on Thursday, as it supports an economy whose recovery is at risk from a renewed surge in coronavirus disease 2019 (COVID-19) infections.

The Monetary Board kept the overnight reverse repurchase rate at an all-time low of 2% for a third consecutive meeting, as predicted by 19 economists in a BusinessWorld poll last week. Rates for the overnight lending and deposit facilities were also maintained at 2.5% and 1.5%, respectively.

The government tightened some restrictions in Metro Manila and nearby provinces until April 4 in hopes of curbing the rising number of COVID-19 cases. As of Thursday, the Health department reported 8,773 new infections, with active cases nearing 100,000.

“The Monetary Board is of the view that prevailing monetary policy settings remain appropriate to support the government’s broader efforts to facilitate the recovery of the economy,” BSP Governor Benjamin E. Diokno said at an online briefing on Thursday.

The central bank kept policy settings steady since its December meeting, but Mr. Diokno hinted that they will respond accordingly when the need arises.

“The BSP is prepared to take immediate measures as appropriate to ensure that the monetary policy stance continues to support the BSP’s price and financial stability objectives,” Mr. Diokno said, stressing they will remain watchful for signs of a broader-based inflation.

Despite the recent spike, Mr. Diokno said the risk to the inflation outlook “appears to be broadly balanced” this year, and “leaning toward the downside in 2022.”

However, the BSP chief said further upside risks may emanate from tight domestic supply of meat products and pickup in global economic activity.

Downside risks come from the prolonged pandemic, the surge in COVID-19 cases, and challenges to the government’s mass vaccination program, Mr. Diokno added.

Headline inflation reached 4.7% in February, the highest since the 5.1% in December 2018.

“The Monetary Board emphasizes that the timely implementation of non-monetary interventions is crucial in mitigating the impact of supply-side pressures on inflation and thereby preventing them from spilling over as second-round effects,” Mr. Diokno said.

QUICKER INFLATION
Meanwhile, the central bank upwardly revised its inflation outlook to 4.2% this year, from the earlier forecast of 4% given in February. The average print for 2022 is seen at 2.8%, slightly higher than the previous projection of 2.7%, according to BSP Deputy Governor Francisco G. Dakila, Jr.

He said the February inflation print and the continued increase in global oil prices due to demand recovery were major factors to the inflation forecasts.

But Mr. Dakila stressed they still view the inflation uptick as “transitory” as it is mainly due to low supply.

“We are actually seeing that the inflation path will decelerate below the midpoint of the [2-4%] target range towards the fourth quarter of this year and continuing on to the first quarter of next year before settling close to the midpoint by the second half of next year,” Mr. Dakila.

Meanwhile, he said the BSP also raised its average Dubai crude oil price forecast to $61.37 per barrel (from $54.65 per barrel) this year, and to $57.79 per barrel (from $51.98) in 2022.

“As the global economy recovers, then oil prices will also recover and this has an impact on inflation,” Mr. Dakila said.

Despite the higher inflation outlook, Mr. Dakila said it remains necessary for the central bank to maintain its accommodative stance to support recovery. He added that supply-side factors should not trigger an “earlier-than-planned” exit from policy measures as this kind of inflation is better addressed by non-monetary actions.

“It is important that while the economic recovery is still in its nascent stage, then the monetary policy stance should continue to be supportive of the economy until such time that the recovery becomes fully self-sustaining,” he said.

ANZ Research Chief Economist Sanjay Mathur and analyst Rini Sen in a note said that while the BSP kept policy rates steady, its tone has become “more cautious on the underlying inflationary impulse.”

“We concur and do not expect any further rate action in 2021,” they said.

ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa said the central bank may likely keep the rate settings in the near term, which could provide support to the peso’s stability.

“BSP may only consider a possible rate hike should inflation remain stubbornly high, which could disanchor inflation expectations and spark second-round effects such as wage and transport fare adjustments,” Mr. Mapa said.

S&P lowers PHL growth forecast

S&P GLOBAL RATINGS downgraded its Philippine growth forecast to 7.9% this year as the upward spike in inflation weighs on the consumption-driven economy.

“Inflation is high despite the lack of demand, on the back of sharp supply-side driven increases in food prices. We expect this to be transitory, but it does weigh on consumption in the first half of the year,” the global debt watcher said in a note on Thursday.

The latest outlook is more pessimistic than the 9.6% gross domestic product (GDP) projection it gave in September 2020. The GDP forecast for 2022 was likewise trimmed to 7.2% from 7.6% previously.

S&P’s growth forecast for the Philippines is the second highest in the Association of Southeast Asian Nations (ASEAN) next to Vietnam (8.5%), and is followed by Malaysia (6.2%), Singapore (5.8%), Indonesia (4.5%), and Thailand (4.2%). However, this outlook is partly due to a base effect as the Philippines also saw the steepest economic contraction of 9.5% last year in Southeast Asia.

The country’s headline inflation has accelerated in the past months. Inflation quickened to 4.7% in February, beyond the 2-4% target by the central bank and the fastest since the 5.1% print in December 2018. Higher prices of goods is hurting households, whose consumption fuels 70% of the economy.

The government traced the inflation surge to low supply caused by the typhoons last year as well as the African Swine Fever outbreak. A price cap on meat products has been imposed in Metro Manila and higher pork imports were allowed in response to the supply-side disruptions that caused the price hikes in food products.

Aside from the inflation, muted mobility and the slow pace of coronavirus disease 2019 (COVID-19) vaccinations will also temper the country’s growth trajectory this year, S&P said.

“Mobility indicators remain far below pre-COVID levels, and movement restrictions have extended far longer than we expected. We continue to expect a pickup in mobility in the second half of the year, but there will be a delay in economic recovery,” the credit rater said.

Tighter COVID-19 rules are in place in Metro Manila, Cavite, Laguna, Rizal, and Bulacan until April 4, as the number of COVID-19 cases continues to surge.

On Thursday, the Health department reported a record-high 8,773 new coronavirus cases, with active cases now nearing 100,000.

Data showed 1.12 million vaccine doses have been administered as of March 23. The government is targeting to inoculate 70 million Filipinos within the year to achieve herd immunity.

S&P said the country’s vaccination efforts have been “expectedly slow.”

As the crisis continues, S&P said the prospect of higher fiscal support this year “remains doubtful.”

“The lack of additional policy support implies a sharper downside risk if the economy’s mobility suffers further impediments,” the debt watcher said.

House Speaker Lord Allan Jay Q. Velasco on Wednesday said he got an assurance of support for the proposed P420-billion Bayanihan to Arise as One Act.

While 224 members of the House of Representatives support the stimulus package, economic managers have previously said this is not needed as pandemic response measures are already covered by the national budget as well as the prior Republic Act No. 11469 or the Bayanihan to Heal As One Act. 

Meanwhile, S&P said they expect the Bangko Sentral ng Pilipinas (BSP) to keep watch on the transitory rise in inflation.

S&P affirmed the country’s BBB+ long-term credit rating in May last year with a stable outlook, suggesting the rating may be maintained over the next 18-24 months. — Luz Wendy T. Noble