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ANZ sees 2021 Philippine GDP growth at 7.1%

GROSS DOMESTIC PRODUCT (GDP) growth in 2021 is expected to hit 7.1%, though consumption could remain cautious with household incomes still under pressure from the economic downturn, according to ANZ Research.

ANZ Research Chief Economist Sanjay Mathur and foreign exchange analyst Dhiraj Nim said in a note, “Asia: Bracing for the reopening trade,” said spending on services such as travel, accommodation, recreation, and retail could help propel a recovery from 2020 lows as movement restrictions in Asia gradually ease.

“We can’t assume that (lower-income groups’) incomes and employment will recover to pre-pandemic levels immediately. However, the middle and upper-income groups, which have been relatively less affected by the pandemic, account for the lion’s share of spending on discretionary services,” ANZ said in a separate report.

Consumption accounts for 70% of the Philippine economy, supported largely by cash remittances, which fell 0.8% to $29.903 billion last year.

ANZ Research’s 2020 GDP forecast falls within the government’s 6.5% to 7.5% projection. In 2022, the bank expects the economy to grow by 6.2%.

ANZ Research also flagged inflation risk in Asia “at a time when markets are insufficiently prepared for it.”

Headline inflation in the Philippines hit 4.7% in February, the highest since 5.1% in December 2018, as oil and food prices continued to rise.

ANZ Research said inflation is expected to come in at about 3.8% and 1.8% in 2021 and 2022 respectively, both lower than the central bank’s 4% and 2.7% assumptions for those years.

ANZ Research said it is bullish about the prospects of a broader economic recovery in the region as vaccination drives gain momentum, which will help reopen trade. — Luz Wendy T. Noble

ARTA asks agencies to extend permit validity due to mobility curbs

THE Anti-Red Tape Authority (ARTA) has asked government agencies to extend the validity of permits while the public faces mobility restrictions during the pandemic.

In a statement Tuesday, the regulator said that the validity of permits, licenses, and other government authorizations should be extended, except in the case of “authorizations that may pose danger to public health and security.”

In a report sent to the Office of the President, ARTA recommended incentivizing the use of online platforms and suspending fees for initial business registrations of micro-, small-, and medium-sized enterprises.

Such fees should also be waived for “startups and those falling within the gig economy,” ARTA said.

Government agencies are also in talks to potentially exempt startups from some business permit requirements, Trade Secretary Ramon M. Lopez said.

Lockdown restrictions have been tightened for two weeks as coronavirus disease 2019 (COVID-19) cases surge. Only essential travel will be allowed to and from Metro Manila and nearby provinces, or the so-called “NCR Plus” bubble.

ARTA, after reviewing 48 compliance reports from National Government agencies, said that almost 97% of more than 1,500 services comply with the prescribed processing time under Republic Act No. 11032 or the Ease of Doing Business and Efficient Government Service Delivery Act of 2018.

The law prescribes processing times of three working days for simple transactions, seven working days for complex transactions, and 20 working days for highly technical applications or when the safety of the public or national security needs to be considered.

The agency also endorsed the issuance of executive orders streamlining government services for the telecommunications, logistics, socialized housing, and energy sectors. — Jenina P. Ibañez

Farm industry lobbying for increased tariffs on pork, calls importers’ profits excessive

A FARM industry association, Samahang Industriya ng Agrikultura (SINAG), has proposed an increase in tariffs for imported pork to the Tariff Commission.

SINAG Chairman Rosendo O. So said in a letter to the commission that tariffs for pork imports within the minimum access volume (MAV) quota should rise to 40%, and the rate charged for out-of-quota imports set at 44%.

Currently, pork imports within the MAV are charged with 30%, while out-of-quota imports pay 40%.

MAV applies to farm commodities that can be imported at lower tariffs under the World Trade Organization (WTO) system.

“Importers are raking in profits at the current tariff rate with no corresponding (impact) on the retail price of prime pork cuts,” Mr. So said in the letter.

According to Mr. So, the average landed cost of pork imports was P81 per kilogram in the January 2020 to January 2021 period. He was citing the Bureau of Customs data.

He added that imported pork sold for between P350 and P450 per kilogram in the first two months of 2021, a period in which pork market prices were rising due to insufficient supply as a result of the African Swine Fever (ASF) outbreak.

“Importers claim that they are not violating any law and are just following the retail price of pork. They are easily profiting between P200 to 250 per kilogram at the current retail of P350 to 400 per kilogram of pork belly (liempo) and pork shoulder (kasim),” Mr. So said.

On Feb. 8, the government implemented a price ceiling that capped the prices of kasim at P270 per kilogram and liempo at P300 per kilogram.

It also capped the price of whole chicken at P160 per kilogram.

Mr. So added that raising pork tariffs will generate revenue that can be used by the government to fund its coronavirus disease 2019 (COVID-19) containment and relief programs.

“Reducing tariffs will deprive the government of much-needed revenue… that could support the COVID-19 vaccination program and efforts to help the livestock industry recover from the ASF outbreak,” Mr. So said.

The Department of Agriculture (DA) has a pending proposal to lower tariffs for pork imports to increase supply and dampen price pressures. It proposes to lower the tariff on pork imports within the MAV quota to between 5% and 10%, and that for out-of-quota imports to between 15% and 20%.

The DA has also recommended an increase in the MAV quota to 404,210 metric tons (MT) from the current 54,000 MT.

Jesus C. Cham, president of the Meat Importers and Traders Association (MITA) said in a mobile phone message that SINAG’s proposal is not favorable for groups wishing to import pork.

Mr. Cham said MITA is not in favor of raising the tariffs, but added it will wait for the Tariff Commission to call a hearing before presenting its position.

“This goes against the WTO principles of globalization and trade facilitation. Local producers want to force consumers to patronize them at any price, not taking into consideration the affordability of the product,” Mr. Cham said.

“Producers said they will sell their products at a fair price. This price has been proven to be unaffordable to the great majority of consumers,” he added.

The United Broiler Raisers Association, whose members raise poultry for meat, sent a letter to Senator Cynthia A. Villar on March 18 seeking the abolition of the MAV scheme for pork and chicken imports, touting its proposal as an anti-corruption measure.

DA Spokesperson Noel O. Reyes said in a mobile phone message that the department is aware of SINAG’s proposal and is awaiting the decision of the Tariff Commission.

“They sounded it out during the recent Senate Committee public hearing. (The proposals are) already with the Tariff Commission. Our goal is to stabilize the supply and prices of pork as local hog production will not suffice,” Mr. Reyes said. — Revin Mikhael D. Ochave

Unions pressing for right to opt out of pension contributions

UNIONS said a proposed pension scheme needs to be established on the basis of voluntary worker contributions, saying that deductions from pay could be too burdensome.

The arguments for employer-only pension contributions were laid out in the House Committee on Banks and Financial Intermediaries, which was discussing House Bill 8938 or the proposed Capital Market Development Act of 2021.

The bill calls for all private-sector employees to have an Employee Pension and Retirement Income (EPRI) Account, to which the employer and employee are required to contribute. EPRIs will also be portable, following the worker throughout his working life regardless of changes in employer.

Trade Union Congress of the Philippines Policy and Advocacies Officer Nicole K. Parreño said worker contributions to their pensions should be voluntary as required contributions will represent a further “burden.”

“The contribution on the part of the employee should be made voluntary because they already have to pay for SSS, PhilHealth, and Pag-IBIG. Any additional contributions taken out of their salaries may be too big a burden to bear,” she said.

“We prefer that the contribution be voluntary for workers with extra savings, even if the contribution is quite low at 1% of base salary… they may still feel this is a burden considering the state of the economy,” she added.

According to the substitute bill as it stood on March 22, the initial contribution for those earning minimum wage or less is 0% while the employer pays 4%. For workers above minimum wage, the initial contributions are 1% for the worker and 4% for the employer.

The committee’s chairman, Representative Junie E. Cua, said voluntary contributions will limit the effectiveness of the pension scheme. In the bill’s current form, employers already contribute more than the workers to their EPRI accounts.

“It’s clear under that arrangement, the employee benefits more… if we make one of those arrangements voluntary or make the other compulsory, it will not be fair. The other might request that both arrangements be voluntary and then we won’t have a program anymore,” he said.

The proposed law gives the power to increase EPRI contributions to the Insurance Commission, after consulting the Department of Labor and Employment and the Department of Finance.

Economic managers have touted the bill as holding the potential to raise workers’ retirement packages while helping the development of the capital markets by raising the pool of investible funds. — Gillian M. Cortez

ADB calls for reforms in PHL technical, vocational education

THE Asian Development Bank (ADB) said the Philippines needs to upgrade its technical and vocational education training (TVET) system to better adapt to industry developments after the economic downturn caused by the pandemic.

The ADB estimated that TVET increases the average labor force participation rate of graduates by 3.2-5.3 percentage points compared to those who did not complete the program, based on a bank report, “TVET in the Philippines in the Age of Industry 4.0.”

However, completing the TVET program does not always result in graduates finding jobs right away. Training was also deemed insufficient in addressing youth underemployment, it said.

“The results suggest that even when TVET leads to employment, this is apparently more likely to be in occupations where workers still desire additional working hours, and look for an additional job or even a new job with longer hours,” it said.

It also noted that employers’ satisfaction with the work performance of TVET graduates declined between 2011 and 2014, particularly in speech and writing skills and their ability to follow rules.

“Skill mismatches limit TVET graduates’ employability and reflect an inability to keep the training curriculum, course offerings, and training equipment relevant for the job market,” it added.

The ADB said the Philippine labor market should brace for structural transformation and job displacement brought about by the Fourth Industrial Revolution, as well as the adverse impact of the economic downturn on jobs and wages. — Beatrice M. Laforga

Palay farmgate price up 0.3% in late January

THE AVERAGE farmgate price of palay, or unmilled rice, rose 0.3% week on week to P16.69 per kilogram in the fourth week of January, with the price increasing 3.4% year on year, the Philippine Statistics Authority (PSA) said.

In its weekly update on palay, rice, and corn prices, the PSA said the average wholesale price of well-milled rice rose 0.3% to P37.46 while the retail price rose 0.3% to P41.04.

The average wholesale price of regular-milled rice rose 0.3% to P33.36 while the retail price rose 0.2% to P36.14.

Meanwhile, the PSA said the farmgate price of yellow corn grain fell 0.4% week on week to P12.58 per kilogram.

The average wholesale price of yellow corn grain rose 0.3% to P20.02 while the retail price rose 0.1% to P24.37.

The farmgate price of white corn grain rose 0.5% week on week to P14.32 per kilogram.

The average wholesale price of white corn grain fell 0.4% to P17.47 while the retail price fell 0.03% to P25.80. — Revin Mikhael D. Ochave

Lowland vegetable shortage expected in 2021

A SUPPLY shortfall is being projected in 2021 for lowland vegetables such as ampalaya (bitter gourd), eggplant, and squash, the Department of Agriculture (DA) said.

At a virtual briefing Tuesday, DA High-Value Crops Program Director U-Nichols A. Manalo said the supply-demand gap in lowland vegetables is estimated at 378,064.51 metric tons (MT).

He said the projected net supply of lowland vegetables is 1.27 million MT, sufficient to meet 80% of domestic demand.

“However, even if we have a projected supply deficit of lowland vegetables based on the data, people in the provinces have access to other vegetables,” Mr. Manalo said.   

Mr. Manalo said upland vegetables such as carrots, cabbage, white potato, and pechay (Chinese cabbage) are projected to be in surplus by 360,315.81 MT.

He said the net supply of upland vegetables for 2021 is projected at 815,632.95 MT, equivalent to 193% self-sufficiency.

“Regions such as the Cordillera Administrative Region (CAR), Cagayan Valley, and Northern Mindanao have high production of upland vegetables,” Mr. Manalo said.

Mr. Manalo said there will be an onion surplus, with net supply projected at 264,248 MT, equivalent to a self-sufficiency level of 103%.

Garlic will remain mostly imported, he said. “The country is only at a 4% sufficiency level when it comes to garlic, according to the Philippine Statistics Authority.  

“Our supply projections assume that we do not have consecutive typhoons entering the country in the later part of 2021,” Mr. Manalo said. — Revin Mikhael D. Ochave

Nominations open for farmer representatives to coconut regulator’s board

THE PHILIPPINE Coconut Authority (PCA) said it has opened the nomination process for the three farmer representatives to the PCA board.

PCA Administrator Benjamin R. Madrigal, Jr. said in a statement Tuesday that copies of the proposed nomination and selection process have been distributed to the PCA’s regional and provincial offices.

“We encourage our coconut farmers, as the direct beneficiaries of Republic Act No. 11524 or the Coconut Farmers and Industry Trust Fund Act, to ensure that they participate in the consultation and more particularly, in the nomination process — to ensure that we get the most qualified farmer-representatives,” Mr. Madrigal said.

“While there is no designated timeline on the designation of farmer representatives … the PCA hopes to have the three farmer representatives to the PCA Board the soonest time possible,” he added.

Under the law, farmer representatives — one from Luzon, one from Visayas, and another from Mindanao — must sit on the PCA board.

“The law requires that the farmer representatives be appointed by the President from a list of four nominees from each island group,” the PCA said.

The farmer representatives will be joined in the PCA board by the Secretaries of Agriculture, Finance, Budget, Science and Technology, and Trade, as well as the PCA administrator.

“The proposed nomination and selection process by the PCA involves the collective voting of coconut farmers as a coconut farmer organization, association, or a cooperative, from provincial to regional and eventually, island-wide nomination,” the PCA said.

According to the PCA, nominees must be Filipino citizens registered with the national coconut farmers registry system; possess not more than five hectares of land over the last 10 years; have a track record in promoting coconut farmers’ interests and welfare; and be nominated by coconut farmer organizations or cooperatives that have been active in the past three years in farmer organization or community enterprise development.

Signed on Feb. 26, RA 11524 will deploy coconut levy funds to support a development plan to be drafted by the PCA.

The programs will include farmer training, research, the development of hybrid farms, and credit expansion. In previous statements, the PCA said the fund will benefit 2.5 million coconut farmers.

The law requires the Bureau of the Treasury to transfer P10 billion to the trust fund in the first year, P10 billion in the second, P15 billion in the third, P15 billion in the fourth, and P25 billion in the fifth.

Former President Ferdinand E. Marcos and his associates imposed the coconut levy on farmers, promising to develop the industry with the proceeds as well as a share of the investment returns.

However, the money was diverted to purchase corporate assets like the United Coconut Planters Bank and San Miguel Corp. — Revin Mikhael D. Ochave

Metro mayors order closure of fitness centers amid new surge

THE MAYORS of Manila, the capital and nearby cities have agreed to suspend the operations of several nonessential businesses for two weeks amid a fresh surge in coronavirus infections, according to the presidential palace.

Metro Manila chiefs voted to temporarily keep spas, fitness centers and internet cafes closed during a two-week general lockdown with more restrictions in the capital region and nearby provinces, presidential spokesman Herminio L. Roque, Jr. told a televised news briefing on Tuesday.

The decision was in keeping with guidelines issued by the Trade department giving local governments the power to shut gyms, spas and internet cafes, he added.

Gyms and fitness centers were initially allowed to operate at as much as 75% capacity and 50% capacity, respectively inside the so-called National Capital Region Plus (NCR Plus) bubble where the restrictions are in place.

But Mr. Roque said local leaders have the authority to suspend the operations of these businesses depending on their situation.

Although last year’s memo by an inter-agency task force allowed local governments to determine operating capacity and guidelines, it still issued a circular on uniform implementation Trade Secretary Ramon M. Lopez told reporters in a Viber group message.

The memo would cover “gyms and fitness centers, internet cafes, spas and full body massage places,” he said.

In a Tuesday memo that adopted the latest pandemic rules, the agency advised businesses to continue enforcing alternative work arrangements to combat the spread of the coronavirus.

“The DTI, through the Fair Trade Enforcement Bureau and Regional or Provincial Offices, shall enhance its regular monitoring activities to confirm and ensure strict compliance with minimum public health and safety standards and protocols,” it said.

The Department of Health (DoH) reported 5,867 coronavirus infections on Tuesday, bringing the total to 677,653.

Tuesday’s tally was lower than the 8,019 new cases on Monday, the highest daily tally since the start of the pandemic last year.

The death toll rose by 20 to 12,992, while recoveries increased by 620 to 578,461, it said in a bulletin.

There were 86,200 active cases, 95.4% of which were mild, 2.3% did not show symptoms, 0.9% were critical, 0.9% were severe and 0.49% were moderate.

The agency said six duplicates had been removed from the tally, while eight recovered cases were reclassified as deaths. Nine laboratories failed to submit data on Mar. 22. 

About 9.1 million Filipinos have been tested for the coronavirus as of Mar. 16, according to DoH’s tracker website.

The coronavirus has sickened about 124.3 million and killed 2.7 million people worldwide, according to the Worldometers website, citing various sources including data from the World Health Organization.

About 100.3 million people have recovered, it said.

Caloocan Bishop Virgilio S. David earlier slammed the government for banning church gatherings while allowing luxurious activities to operate in the greater Manila bubble.

He urged the faithful to defy quarantine guidelines that lack consultations and violate the “separation of church and state.”

Despite the ban on religious gatherings in the capital region and surrounding provinces, the archdiocese of Manila said it would continue to hold religious services at 10% capacity starting on Wednesday.

“We will not have any religious activity outside of our churches such as senakulo, pabasa, processions, motorcades, and Visita Iglesia,” Bishop Broderick Pabillo said in a pastoral letter. “But within our churches starting Mar. 24, we will have our religious worship within 10% of our maximum church capacity.”

“That would be contrary to the guidelines of the inter-agency task force,” Mr. Roque said. The palace had urged Mr. Pabillo not to encourage Catholics to disregard the rules, he said.

Mr. Roque said the state would not hesitate to use its police power to enforce regulations if the Catholic Church defied quarantine rules.

Also on Tuesday, the DoH said the government would set up more isolation centers and temporary treatment and monitoring facilities to house Filipinos with mild and asymptomatic coronavirus symptoms.

The centers would boost the capacity of hospitals in Manila and nearby cities to treat coronavirus patients, Health Undersecretary Leopoldo J. Vega told a televised news briefing. — Kyle Aristophere T. Atienza and Vann Marlo M. Villegas

US stands by Manila in protesting mooring of Chinese vessels

THE United States on Tuesday said it stands with the Philippines after more than 200 Chinese vessels were spotted moored at a reef in the South China Sea that Manila claims.

In a statement, the US Embassy in Manila said it “shares the concern” of the Philippines, which filed a diplomatic protest against China this week.

In a separate statement, the Philippine Department of Foreign Affairs demanded that China withdraw its fishing vessels and maritime assets at Whitsun Reef, accusing it of infringing on Philippine sovereignty.

“The continued deployment, lingering presence and activities of Chinese vessels in Philippine maritime zones blatantly infringe upon Philippine sovereignty, sovereign rights and jurisdiction,” the agency said.

It urged China to order its fishing vessels to stop environmentally destructive activities at the reef, which it said is within the Philippine exclusive economic zone.

The Philippine government earlier said it was concerned that the Chinese militia vessels had massed at the reef, which it calls Julian Felipe, with no actual fishing activities.

They had their full white lights turned on during night time, a national task force overseeing border disputes with Beijing said in a statement at the weekend, citing the Philippine Coast Guard.

The task force cited potential overfishing and destruction of the marine environment, as well as risks to navigation safety.

“The People’s Republic of China uses maritime militia to intimidate, provoke and threaten other nations, which undermines peace and security in the region,” the US Embassy said. 

“Chinese boats have been mooring in this area for many months in ever increasing numbers, regardless of the weather.  We stand with the Philippines, our oldest treaty ally in Asia,” it added.

The Chinese Embassy in Manila on Monday said the reef, which it calls Niu’e Jiao, is part of China’s Nansha Qundao.

It said some Chinese fishing vessels had taken shelter near Niu’e Jiao due to rough sea conditions.

The Chinese Embassy said the vessels there were not Chinese militia, adding that speculations cause “unnecessary irritation.”

Senators on Monday backed the Philippine government’s diplomatic protest against China.

Senator Risa N. Hontiveros-Baraquel said the presence of the Chinese vessels within the Philippine territory is a “severe provocation” that would only escalate tensions in the disputed waterway.

She accused China of rudely advancing into Philippine seas, adding that not aggravating the tensions is the absolute least China could have done in the middle of a global pandemic.

Ms. Hontiveros said the government should study other ways to make China pay, noting that there could be more environmental damage and loss of natural resources due to their presence at the reef. 

Ms. Hontiveros last month said China owes the Philippines more than P800 billion in marine damage and losses in the South China Sea.

Senator Francis N. Pangilinan also backed the diplomatic protest, citing China’s “unabated militarization and expansionism in the West Philippine Sea” during the pandemic, referring to areas of the South China Sea with the country’s exclusive economic zone.

He accused China of using donated vaccines as a “geopolitical weapon.” — Vann Marlo M. Villegas

LRT-1, MRT-3 closed during Holy week for maintenance work

LIGHT Rail Transit Lines 1 and 2, Metro Rail Transit Line 3 (MRT-3) and the Philippine National Railways in the capital region would be closed during Holy Week for maintenance, their management said on Tuesday.

Light Rail Manila Corp. (LRMC), the private operator of LRT-1, said it would suspend operations from Mar. 31 to Apr. 4 for its annual maintenance.

The maintenance work would ensure their trains perform at their best, LRMC Chief Operating Officer Enrico R. Benipayo said in a statement.

LRT-2 will also suspend operations from Mar. 31 to Apr. 4, while the Philippine National Railways (PNR) will be closed on Apr. 1, except for the Calamba-Tutuban route. Train operations will be suspended on Apr. 2 and 3.

On Apr. 4, PNR will resume operations for Tutuban-Alabang and vice versa, Tutuban-Calamba and vice versa, Tutuban-Gov. Pascual and vice versa, Gov. Pascual-Bicutan and vice versa, and Naga-Sipocot and vice versa.

It will resume normal operations on Apr. 5.

Meanwile, MRT-3 said in a Twitter post it would suspend train operations from Mar. 30 to Apr. 4.

The MRT-3 management also said it had signed a memorandum of agreement with Cosmotech Philippines, Inc. for the use of the contact-tracing app Traze at the rail line.

“To use it, passengers will have to scan the QR codes three times — at their entry station, the train coach where they are riding, and their exit station,” it said in a statement. “Passengers who do not have smartphone devices may still opt to use the manual contact tracing form.”

It said the use of Traze would help unify contact-tracing efforts across different transportation sectors.

Passengers may download Traze on Google Play, App Store, Huawei AppGaller, or Samsung Galaxy Store. — Arjay L. Balinbin

Tribunal vows to protect judges, lawyers

THE Supreme Court on Monday condemned the killing of judges and lawyers and said it would change court rules and make new ones if needed to protect the Judiciary.

“To assault the Judiciary is to shake the very bedrock on which the rule of law stands,” the tribunal said in an e-mailed statement. “This cannot be allowed in a civilized society like ours.”

The high court asked lower courts and law enforcement offices “to shed light on the number and context of each and every threat or killing of a lawyer or judge within the past 10 years.”

It also urged the public to submit “vetted information” on any incidents of threats or killings of judges and lawyers before its meets next month to discuss the matter.

The court said it was working on the rules on the use of body cameras to be used when serving search and arrest warrants.

It said it had received letters from different groups on the matter and that it would refer these to trial courts so these letters could be converted into proper lawsuits.

The tribunal said it recognizes “the bravery of all the judges and lawyers who show up to administer justice in the face of fear.” It urged the entire Judiciary and members of the legal profession “to remain strong, steadfast and unwavering in the duties they swore an oath to fulfill.”

Edre U. Olalia, president of the National Union of Peoples’ Lawyers, said it was “comforting and reassuring” for the Supreme Court to have finally spoken on the matter.” — Bianca Angelica D. Añago

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