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Top 10 economic news of 2020

Here is my modest list of the major economic events of the year.

1. The deep global contraction of gross domestic product (GDP). In the first three quarters of 2020, the Philippines’ GDP in particular had contracted by -9.7%, the worst performing economy in the ASEAN and among the worst performers in the whole world.

2. Global exports also contracted. Restrictions on the mobility of people and goods adversely affected manufacturing, the transport of raw materials and finished products, and, ultimately, merchandise trade. The Philippines, with measly exports of $70 billion in 2019, experienced further low exports of only $46 billion in the first three quarters of 2020.

3. Strict lockdown policies in many countries. The Google COVID-19 Community Mobility Reports (GCCMR) shows how visitors to (or time spent in) categorized places change compared to baseline days, the median value being from Jan. 3-Feb. 6, 2020. When it came to mobility in transit stations in particular, the Philippines seems to have had the strictest lockdown policy in the world with -84 mobility in April and -53 in November.

4. China data is proven to be dishonest again. Consider these: a.) its COVID-19 deaths per million population (CDPMP) was only three considering that the virus started and exploded from there, while Belgium has 1,650 and the UK’s is 1,090; b.) it says it has growth when many countries are in a deep contraction — it cannot hide its exports contraction; and, c.) it does not allow GCCMR to collect data because it will show the extent of its strict lockdown and business contraction (see Table 1).

5. Overspending and over-borrowings by governments. As tax revenues fell due to business shutdowns, many governments did not cut their expenditures but instead expanded spending and subsidies via huge borrowings and the printing of money by their central banks. The Philippines’ central government debt (debts by LGUs not included) was 37% of GDP in 2019 and is projected to rise to 48.9% in 2020 and 52.5% in 2021 (see Table 2).

6. The CREATE bill is refined and retroactive to 2020. The Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) bill in Congress intends to cut the Philippines’ high corporate income tax (CIT) rate of 30% to 25% upon signing into law, likely in early 2021, to be implemented retroactively to July 2020. The bill also targets to cut CIT to 20% by 2027.

7. President’s threat of telecom expropriation. During President Rodrigo R. Duterte’s State of the Nation Address (SONA) in July, he warned Smart and Globe telecoms that “kukunin ko ‘yan, i-expropriate ko sa gobyerno (I will get that, I will have the government expropriate it).” It was a strong, and the first, major threat of corporate expropriation by the administration. Luckily, he realized that many LGUs and some agencies are the reason why telecom firms cannot expand their cell sites and towers quickly.

8. The IPRI report on property rights protection. Government expropriation of private companies, actual or the threat of, is a clear violation of the private property protection enshrined in the Constitution. The International Property Rights Index (IPRI) annual report for 2020, a project of the Property Rights Alliance (PRA), was released last November. The Philippines retained its low global rank of 67-69 of 129 countries (see Table 2).

9. Big infra finished and legislated. Among the huge projects that were completed this year was the Skyway Stage 3 that connects SLEX to NLEX, so vehicles from Southern Luzon can go straight to Northern Luzon without passing on any street of Metro Manila. Then the legislation was passed to allow San Miguel Aerocity in Bulacan, a P736-billion 10-year construction project, to start in early 2021.

10. NAIA rehabilitation uncertainties. The expansion and modernization of the Ninoy Aquino International Airport (NAIA) suffered a double setback this year. First was the termination of the original proponent status (OPS) of the “super consortium” of seven conglomerates (Ayala, Aboitiz, Gokongwei, Andrew Tan, Lucio Tan, Gotianun, Pangilinan) last July, then the termination of the OPS of Megawide-GMR this December.

The year 2020 has not been good. The so-called “new normal” simply cloaked the new dictatorship with strict and indefinite lockdowns. May 2021 bring the realization that this is folly so that human prosperity can resume again.

 

Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers

minimalgovernment@gmail.com

Here’s why river overflow can lead to flood damage

Flood can be very terrifying if you live near rivers. Though called in much literature as a source of life, rivers can actually take lives when they overflow. Rivers carry many risks, especially when there is heavy rainfall and overtopping happens. When there is too much water because of very high volume of rainfall, water can burst the river banks, causing dry areas to be flooded.

WHAT CAUSES RIVER OVERFLOW?
Though flooding can be attributed to excessive rainfall, there are other factors that play different roles in the overflowing of rivers.

One of these factors is prevailing mining operations. Mining, both underground and above ground, increases the risk of floods for the residents near rivers.

Earlier this year, major flooding in Samarinda, Indonesia was experienced after hours of heavy rain which caused the Mahakam River to overflow. Samarinda City sits along the Mahakam River. Some people attributed the incident to deforestation caused by mining; some to unmonitored or abandoned mining pits. Whichever of the two, mining in general reduced the land’s ability to absorb water, which led to overland flow.

Aside from mining, faulty man-made dams can also cause rivers to overflow. One of the dams’ primary purposes is for flood control. Dams store the water from rainfall that could otherwise have flooded the lowlands. Eventually, this water is used for generating hydroelectricity and for sustaining irrigation projects. This is all well and good when there is just moderate rainfall. However, when there is torrential rain and dams can no longer hold the water, the soundest decision to make is to release the excess water into rivers or other bodies of water. An analysis in a study entitled “Dams and Floods,” authored by Fred Pearce, says that “dams are often designed with very poor knowledge of the potential for extreme flood events.”

The recent flooding in Cagayan and Isabela provinces in the Philippines after the passage of Typhoon Ulysses (international name: Vamco) was blamed on the release of water from Magat Dam in North Luzon, among other factors. On Nov. 12, 2020, from 5 p.m. to 4 a.m. the next day, seven gates of the dam were opened. The Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA) said that 6,706 cubic meters of water per second were released from the dam at maximum discharge. This caused the Cagayan River to swell and submerge the surrounding areas.

Making matters worse is the presence of weakly constructed dams. The substandard materials used in these dams can lead to dam failure. Dam failure is defined as an uncontrolled release of water due to structural breakdown. This is not insignificant because dam failure can lead to loss of lives and the washing away of valuable properties. When the Banqiao Dam in China burst, roughly 170,000 people were killed, followed by reports of injuries, water contamination, and food shortages. This incident in Henan Province in 1975 is one of the best illustrations of dam failure.

WHAT ARE THE NEGATIVE EFFECTS OF RIVER OVERFLOW?
When Typhoon Ulysses struck the eastern and central regions of the Philippines, many houses, properties, and other sources of livelihood were damaged due to overspilling of rivers. What happened then at the Marikina River is one good example of river overflow damage. In the midst of the typhoon on Nov. 12, at 11 a.m., the Marikina River swelled up to 22 meters.

The water in the river cut through heavily populated areas of Rizal Province, Quezon City, Marikina City, and Pasig City. The overflowing of the river resulted in the death and displacement of people and damage to properties. Given the seriousness of the situation, it is high time that we should consider the danger of flooding due to river overflow.

WHAT CAN WE DO TO EASE FLOODING?
There are several ways to mitigate flooding as a result of river overflow, one of which is improving our flood warning systems. Another is by providing people with more information about their areas, the dams, and river overflows. However, these actions seem to be passive. What we need is for people to take a more proactive approach to this problem.

As the world experiences extreme weather conditions, we have to let go of our old ways and step up our game. It might hurt some but let us admit it, some flood protection strategies are old fashioned and do more harm than good. One approach which is not very popular but is making headlines nowadays, is setting up flood barriers: modern, easily installed and cost-effective ones.

What we need is strong and good quality flood protection. We need modern flood technology that can protect houses, businesses, schools, and government buildings, especially if they are near rivers. The technology I am talking about are flood barriers: demountable flood barriers, mobile flood barriers, flood doors and gates, sliding, self-rising, automatic flood barriers and permanent glass walls. The materials are made of light-weight marine-grade aluminum, hot dipped-galvanized or stainless steel, non-rusting, which can be used for 50 years and longer. Moreover, these portable barriers can be deployed in the event of flooding, and dismounted when no longer needed. They can even be stacked or stored in a designated area, ready for the next use.

People always say that prevention is better than a cure. As we wait for another typhoon to hit, should we wait for another river to overflow and damage our prop erties or take away our families? Should we not want to be in a secure environment where we can sleep in the midst of a storm with an assurance that you and your properties are safe?

The choice is in your hands. Start investing today!

Stay safe and flood-free!

This article reflects the personal opinion of the author and does not reflect the official stand of the Management Association of the Philippines or the MAP.

 

Dr. Andreas Klippe is the Chair and President of Flood Control Asia RS Corp., Clark, Pampanga, responsible for all RS activities in Asia/Pacific, Chair of the North Luzon Chapter of the European Chamber of Commerce of the Philippines, speaker, writer. He is a German engineer and a Philippine resident.

map@map.org.ph

a.klippe@floodcontrol.asia

http://map.org.ph

2020 should teach these democracies humility

THE YEAR 2020 was, by any measure, rich in awakenings and reckonings. None were as earth-shaking as those forced upon the United States, Britain, and India.

The pandemic found three of the world’s most prominent democracies shockingly underprepared, governed by leaders as incompetent as they were deluded and encumbered with states that had steadily rendered themselves incapable of performing their most basic duty: protecting human lives.

In each case, stridently advanced claims — whether to be a new superpower (India), to become one again (Britain), or to provide moral leadership to the world (US) — were broken on the wheel of an unforgiving virus.

The socio-economic challenges before these countries suddenly seem immense, greater even than those faced after the calamity of two world wars. The conventional formulas for national uplift — intensified mass production of goods and services — are no longer enough in the age of deindustrialization and climate change. Meanwhile, the promise of the knowledge economy seems largely deceptive.

But a deeper and more intractable, if also intangible, problem lies in the realm of perception. For the pandemic revealed the great and crippling chasm that exists between reality and the images cherished by these countries. A future that represents an appreciable improvement over the present will remain elusive unless the diminished democracies develop less grandiose and more pragmatic self-images.

In the conventional, widely celebrated idea of India, the country brims with democratic virtues and seems destined to outpace China and take its place among the great Western powers. “India is not simply emerging,” then-President Barack Obama claimed in 2010, “India has emerged.”

This vision, hardened into an unassailable consensus by politicians, businessmen and journalists, ignored the country’s unresolved contradictions of social and economic inequality, as well as its inept bureaucracies, dodgy bankers, defaulting businessmen, venal politicians and timorous journalists.

In Britain, the dream of imperial power and self-sufficiency grew more intense even as the country became more parasitic on inbound flows of financial capital. The final and shattering delusion was Brexit, a perfect act of national self-harm.

In the US, decades of political dysfunction, endless wars, economic crises and intolerable inequality culminated in four disastrous years of Donald Trump.

In all three cases, the political class and, to a damaging extent, the mainstream media and intelligentsia tried to keep up appearances long after they had frayed.

Thus, Obama could write in Wired magazine, a month before Trump’s election in 2016, that for Americans there had never been a greater time to be alive. In Britain, an alliance of right-wing politicians and journalists won a massive electoral endorsement for their fiction that liberation from the European Union would unleash their country’s world-beating prowess. Prime Minister Narendra Modi successfully kept up his rhetoric of regaining Hindu pride and glory long after his policy of demonetization had severely compromised India’s economy.

All nations are imagined communities. But they lose sight of their essential tasks and fatally restrict their scope of action if they imagine themselves too extravagantly.

India today would be more resilient had it resisted irrational exuberance and diagnosed and repaired early such structural weaknesses as a poorly educated and underfed labor force and underinvestment in the rural sector. Likewise, Britain’s fate as a country that no longer makes enough goods desired by the world need not have been so bleak.

The US would not be a society divided into insulated winners and angry losers had it not believed its own rhetoric about the unimpeachable virtues of its liberal capitalist system after the collapse of the Soviet Union. Stagnation and decline had already set in by the 1990s, and the trillions of dollars spent on military capabilities and democracy-promotion abroad could have been used to stem inequality at home, or at least to bring public healthcare in line with other rich countries.

Illusions of grandeur are again flourishing as a traumatic year ends and a new one begins. The British government and its journalistic mouthpieces promise a windfall of “sovereignty” as Britain leaves the EU on Jan. 1, with or without a deal. India has started to hope again that it can replace China as a destination for manufacturers. The incoming Biden administration is broadcasting its intention, as thousands of Americans succumb to COVID-19 every day, to have the US lead the world again.

Such desires cannot but seem a case of what Sigmund Freud called regression: The national ego is reverting to an earlier developmental stage instead of handling reality in a mature way, still insisting that a gap, cruelly exposed by the pandemic, between self-perception and reality can be narrowed.

With stricken nations, as with individuals, a new and better life becomes possible only after obsolete and unsafe ideas about self are discarded. Admittedly, countries cannot overnight abandon the self-flattering narratives that they have long generated for external consumption. Nevertheless, the great democracies would do well in the new year to adhere to a principle that underpins one of the world’s most gainful businesses: Do not get high on your own supply.

BLOOMBERG OPINION

Trump signs pandemic aid and spending bill

PALM BEACH, Fla./WASHINGTON — US President Donald Trump on Sunday signed into law a $2.3-trillion pandemic aid and spending package, restoring unemployment benefits to millions of Americans and averting a federal government shutdown in a crisis of his own making.

Trump, who leaves office on Jan. 20 after losing November’s election to President-elect Joe Biden, backed down from his earlier threat to block the bill, which was approved by Congress last week, after he came under intense pressure from lawmakers on both sides.

The Republican president, who golfed on Sunday and remained out of public view even as the government crisis loomed, had demanded that Congress change the bill to increase the size of stimulus checks for struggling Americans to $2,000 from $600 and also cut some other spending.

It was not immediately clear why Mr. Trump, who has refused to concede defeat to Mr. Biden, changed his mind on the stimulus package. His resistance had threatened to inject further chaos into the final stretch of his presidency.

After signing the bill behind closed doors at his beachside club, Mr. Trump sought to put the best face on his climb-down, saying he was signing the bill with “a strong message that makes clear to Congress that wasteful items need to be removed.”

“Much more money is coming,” he insisted in a statement, though he provided nothing to back this promise.

And with less than a month left in office, Mr. Trump is expected to gain little or no traction with lawmakers to make changes.

White House officials have been tight-lipped about Mr. Trump’s thinking but a source familiar with the situation said some advisers had urged him to relent because they did not see the point of refusing.

Democrats have long been on board with the $2,000 payments but many Republicans opposed it, making it unlikely that the figure will be revised upwards while Mr. Trump is in office.

Many economists agree the financial aid in the bill should be higher to get the economy moving again but say that immediate support for Americans hit by coronavirus lockdowns is still urgently needed.

Unemployment benefits being paid out to about 14 million people through pandemic programs lapsed on Saturday, but will be restarted now that Mr. Trump has signed the bill.

The package includes $1.4 trillion in spending to fund government agencies. If Mr. Trump had not signed the legislation, then a partial government shutdown would have begun on Tuesday that would have put millions of government workers’ incomes at risk.

Americans are living through a bitter holiday season amid a pandemic that has killed nearly 330,000 people in the United States, with a daily death toll now repeatedly well over 3,000 people, the highest since the pandemic began.

The relief package also extends a moratorium on evictions that was due to expire on Dec. 31, refreshes support for small business payrolls, provides funding to help schools re-open and aid for the transport industry and vaccine distribution.

Global share prices ticked up in response to the news that Trump had signed the stimulus plan and backed away from a government spending crisis.

US S&P futures and Japan’s Nikkei index gained around 0.4%, and spot gold prices rose nearly 1%.

“It is positive for markets that we no longer have a chaos over stimulus, considering there was a chance of a partial government shutdown,” said Masahiro Ichikawa, chief strategist at Sumitomo Mitsui DS Asset Management.

Mr. Trump’s abrupt move to sign the bill came after most Republican lawmakers refused to back his call for changes to legislation they had already voted on.

Hours earlier, Republican Senator Pat Toomey of Pennsylvania told Fox News Sunday Mr. Trump wants “to be remembered for advocating for big checks, but the danger is he’ll be remembered for chaos and misery and erratic behavior if he allows this to expire.”

Republican officials were relieved that Mr. Trump had backed away from his veiled veto threat, saying it should help Republican Senate candidates David Perdue and Kelly Loeffler in Jan. 5 Georgia runoff elections that will determine control of the US Senate.

Mr. Trump noted that the Democratic-controlled House of Representatives planned to vote on Monday to increase coronavirus relief checks to individuals from $600 to $2,000, and said the Senate “will start the process” to approve higher payments.

US Senate Majority Leader Mitch McConnell, a fellow Republican, said “I thank the President for signing this relief into law” but made no mention of any plans for a Senate vote.

Democratic House Speaker Nancy Pelosi welcomed Mr. Trump’s signing as a “down payment on what is needed,” saying: “Now, the President must immediately call on Congressional Republicans to end their obstruction and to join him and Democrats in support of our stand-alone legislation to increase direct payment checks to $2,000.”

After months of wrangling, Republicans and Democrats agreed to the package last weekend, with the support of the White House.

Mr. Trump stunned Republicans and Democrats alike when he later said he was unhappy with the massive bill, which provides $892 billion in coronavirus financial relief.

Trump spent the Christmas holiday at his Mar-a-Lago resort in Florida. On Sunday morning, he seemed in no rush to try to resolve the standoff with Congress as he played a round of golf at the Trump International Golf Club in West Palm Beach.

He had also complained that the bill gives too much money to special interests, cultural projects and foreign aid.

In his signing statement, Mr. Trump also sought to keep alive his campaign of baseless claims that the November election was rigged against him. He said the House and Senate “have agreed to focus strongly on the very substantial voter fraud” and that the Senate will launch an investigation. — Reuters

Britain to ban ‘buy 1 get 1’ promotions to fight obesity

LONDON — Britain will ban “buy one get one free” promotions for food high in fat, sugar or salt and free refills of sugary soft drinks in restaurants from April 2022, the government said on Monday, its latest step in its plan to tackle obesity and improve public health.

The government says obesity is one of Britain’s biggest long-term public health problems with almost two-thirds of adults in England overweight and one in three children leaving primary school overweight or obese.

The measures will also restrict where in a store promotions on such products can be advertised, and unhealthy promotions will not be allowed at checkouts, shop entrances or at the ends of aisles.

“We are restricting promotions and introducing a range of measures to make sure the healthy choice is the easy choice. Creating an environment which helps everyone eat healthier foods more regularly is crucial to improving the health of the nation,” public health minister Jo Churchill said.

Britain first proposed restricting “buy one get one free” deals on junk food in July, and also announced measures such as banning TV and online adverts for junk food before 9.00 p.m.

Last month the government went further and proposed a total ban on online advertising of unhealthy food.

Being overweight has been shown to increase the risk of serious illness or death from coronavirus disease 2019 (COVID-19) — a fact highlighted by Prime Minister Boris Johnson who has publicly talked about his own need to lose weight since being hospitalized with the disease. — Reuters

China jails citizen-journalist for four years over Wuhan coronavirus reporting

SHANGHAI — A Chinese court handed a four-year jail term on Monday to a citizen-journalist who reported from the central city of Wuhan at the peak of last year’s coronavirus outbreak, on grounds of “picking quarrels and provoking trouble,” her lawyer said.

Zhang Zhan, 37, the first such person known to have been tried, was among a handful of people whose firsthand accounts from crowded hospitals and empty streets painted a more dire picture of the pandemic epicenter than the official narrative.

“We will probably appeal,” the lawyer, Ren Quanniu, told Reuters, adding that the trial at a court in Pudong, a district of China’s business hub of Shanghai, ended at 12.30 p.m., with Ms. Zhang being sentenced to four years.

“Ms Zhang believes she is being persecuted for exercising her freedom of speech,” he had said before the trial.

Criticism of China’s early handling of the crisis has been censored, and whistle-blowers, such as doctors, warned. State media have credited success in reining in the virus to the leadership of President Xi Jinping.

The virus has spread worldwide to infect more than 80 million people and kill over 1.76 million, paralyzing air travel as nations threw up barriers against it that have disrupted industries and livelihoods.

In Shanghai, police enforced tight security outside the court where the trial opened seven months after Ms. Zhang’s detention, although some supporters were undeterred.

A man in a wheelchair, who told Reuters he came from the central province of Henan to demonstrate support for Ms. Zhang as a fellow Christian, wrote her name on a poster before police arrived to escort him away.

Foreign journalists were denied entry to the court “due to the epidemic,” court security officials said.

A former lawyer, Ms. Zhang arrived in Wuhan on Feb. 1 from her home in Shanghai.

Her short video clips uploaded to YouTube consist of interviews with residents, commentary and footage of a crematorium, train stations, hospitals and the Wuhan Institute of Virology.

Detained in mid-May, she went on a hunger strike in late June, court documents seen by Reuters say. Her lawyers told the court that police strapped her hands and force-fed her with a tube. By December, she was suffering headaches, giddiness, stomach ache, low blood pressure and a throat infection.

Requests to the court to release Ms. Zhang on bail before the trial and livestream the trial went ignored, her lawyer said.

Other citizen-journalists who had disappeared without explanation included Fang Bin, Chen Qiushi and Li Zehua.

While there has been no news of Mr. Fang, Mr. Li re-emerged in a YouTube video in April to say he was forcibly quarantined, while Mr. Chen, although released, is under surveillance and has not spoken publicly, a friend has said. — Reuters

Thai hospital banned from offer to sell COVID-19 vaccine

BANGKOK — A private Thai hospital was ordered on Sunday to stop advertising COVID-19 vaccinations for sale in advance on the grounds that no vaccine is yet approved in Thailand.

Vibhavadi Hospital told Reuters its online offer for 1,000 initial reservations for the two-dose Moderna vaccine had been the result of a misunderstanding. With reservations priced at 4,000 baht, the total cost of getting vaccinated would have been 10,000 baht ($330).

As the first governments begin vaccine rollouts around the world, questions have been raised over how the limited supplies are prioritised and whether people will be able to pay to jump the queue.

The Ministry of Health said in a statement that no COVID-19 vaccine had been approved for use in Thailand yet and that advertising one violated hospital regulations.

“The removal of the advertisement was ordered,” it said.

Chaisit Kupwiwat, a director at Vibhavadi Hospital, told Reuters: “There was a misunderstanding and so we’ve stopped the programme… We planned to order the vaccines, but now we’ve stopped.”

The hospital had sought reservations by Jan. 31 for vaccinations later in 2021.

Moderna did not respond immediately to an emailed request for comment on any such sale.

Thailand has signed an advance deal for AstraZeneca’s potential COVID-19 vaccine, but has not set rollout plans for any vaccine yet.

Moderna’s vaccine this month became the second to get emergency use authorisation from the U.S. Food and Drug Administration after the Pfizer and BioNTech vaccine.

Moderna has said it will deliver approximately 20 million doses to the U.S. government this year and is expected to have between 100 million and 125 million delivered globally in the first quarter of 2021.

In August, Moderna said it was pricing its vaccine at $32 to $37 per dose for smaller deals.

Thailand is a major hub for medical tourism, drawing patients from Asia, the Middle East and beyond. — Reuters

S.Korea to accelerate virus vaccine efforts

SEOUL — South Korean officials are vowing to speed up efforts to launch a public coronavirus vaccination programme as the country on Monday announced it had detected its first cases of the virus variant linked to the rapid rise in infections in Britain.

The new variant, thought to be more transmissible than others currently circulating, was found in three people who had entered South Korea from London on Dec. 22, the Korea Disease Control and Prevention Agency (KDCA) said on Monday.

Overall the KDCA reported 808 new cases as of midnight Sunday, the lowest since a record 1,241 infections were logged on Friday.

Authorities cautioned that the drop may be due to less testing done over the weekend and the Christmas holiday, and said on Sunday they would be extending social distancing measures until early January.

South Korea’s government has faced mounting domestic criticism over its vaccine procurement and rollout plans, which call for the first vaccinations to begin in the first quarter of next year, months after places such as the United States and the European Union.

Negative views of the vaccine plans was one of the leading reasons that drove President Moon Jae-in’s disapproval rating to an all-time high of nearly 60%, pollster Realmeter said on Monday.

Regulators will shorten the period required to approve vaccines and treatments from and average of 180 days to as little as 40 days, the Ministry of Food and Drug Safety announced on Sunday.

An additional approval process for the distribution and sale of vaccines, which usually takes several months, will be shortened to around 20 days, the ministry said.

Medical workers and elderly residents will begin receiving the vaccinations in February, and plans to vaccinate the broader public is accelerating, presidential chief of staff Noh Young-min said Sunday.

“The government is doing all it can to advance this time frame and is also making progress,” he said.

South Korea has said it plans to buy enough doses to eventually vaccinate 46 million people, or more than 85% of its population.

Noh said authorities expected South Korea’s population to reach a level of herd immunity through the vaccines as fast or faster than many other countries.

South Korea has reported a total of 57,680 coronavirus cases, with 819 deaths.— Reuters

Resorts World Manila unveils revamped Bar 360

Situated at the center of the newly renovated Garden Wing, premier entertainment stage and signature dining outlet Bar 360 has re-opened its doors to the public. The updated design of Bar 360 remains the crowning piece of Garden Wing’s ground floor, with regular DJ playing hits to entertain diners and guests situated all around the stage. Bar 360 is open daily from 4PM to 12MN.

For more information on RWM’s Bar 360 and other signature dining outlets, visit www.rwmanila.com and follow @resortsworldmanila on Facebook, Twitter, and Instagram.

Once a Billionaire Factory, Korea’s Beauty Industry Turns Ugly

Three years ago, Suh Kyung-bae was the second-richest person in South Korea. Today he’s barely Top 10, a stark reversal in a K-beauty boom known for minting billionaires, not breaking them.
Suh’s $3.6 billion fortune — down from roughly $8 billion in 2017 — is largely comprised of shares in his family’s cosmetics conglomerate, Amorepacific Group, which have fallen more than 40% from a mid-January high. The parent of brands like Innisfree, Laniege and Sulwhasoo, Amorepacific was struggling even before Covid-19, and the pandemic has ushered in a slew of lifestyle changes that have made cosmetics less central to women’s daily routines.

That’s brought a halt to the wealth created by the rapid rise in popularity of Korean beauty products and the deal-making frenzy that followed. From 2010 to 2014, foreign companies spent at least $215 million to acquire cosmetics firms there, according to a September report by Samjong KPMG. In the five years that followed, the country became the world’s fourth-largest exporter of beauty products, and the deal volume ballooned to $5 billion, not including transactions for undisclosed sums.

Estee Lauder Cos. made Have & Be Co., widely known for its Dr. Jart+ line, its first acquisition of an Asian beauty brand in November 2019. That deal, worth $1.1 billion, turned founder ChinWook Lee into a billionaire. Goldman Sachs Group Inc. bought a minority stake in GP Club Co., best known for face masks, making founder Kim Jung-woong one of the country’s richest people. Unilever Plc, L’Oreal SA and other multinational companies also got stakes in Korean cosmetics firms, creating massive windfalls for their founders.

But the pandemic has taken a double hit on K-beauty. Social distancing and remote work have lessened demand for makeup and led to store closures. Beauty retail sales in the U.S., the No. 3 market for Korean exports, will be down more than 7% in 2020, according to market research firm Mintel.

For Korea, coronavirus travel restrictions have also cut off the flow of big-spending Chinese tourists and individual merchants who buy tax-free goods in bulk and sell them back home. Meanwhile, China’s customers have more access to global brands and are increasingly interested in products made locally.

“Now it’s naive to think that cosmetic products with made-in-Korea tags would simply win over Chinese customers,” said Lina Oh, a Seoul-based analyst at Ebest Investment & Securities Co.

Neither Have & Be nor GP Club have released financial information for 2020; GP Club’s plan for an initial public offering in 2019 hasn’t been rescheduled.

For Amorepacific, consolidated revenue for the first nine months of the year fell 23% to 3.7 trillion won ($3.4 billion) from the same period in 2019, according to a company filing. For the first time in its history, the group announced last month a plan to offer voluntary retirement targeting employees who have worked for more than 15 years. The company declined to comment on its plans or on Suh’s personal fortune.

At the same time, the pandemic has accelerated the shift to online in the beauty industry. Amorepacific’s revenue for the segment has seen substantial growth, pushing it to prioritize that part of the business. Cosmetics giant L’Oreal, whose sales dropped 12% in the first half of 2020, launched 300 digital services this year, including live beauty tutorials.

Amorepacific plans to reduce the number of Innisfree stores in China but anticipates that overall, digital sales will make up half its business there next year, according to Yuanta Securities Korea. In the domestic market, the company sees the share of online revenue growing to 30% from 20%.

“Spending on cosmetics was already down before Covid,” said Hye-mi Kim, an analyst at Cape Investment & Securities Co. in Seoul. “Covid made it even less necessary. Only must-have items like skincare products or those for facial problems are doing okay.”

Meanwhile, South Korea has new billionaires rising, like Seo Jung-jin, founder of pharmaceutical firm Celltrion Inc., which is developing a Covid-19 antibody treatment. Seo’s wealth has almost tripled this year to $14.6 billion, making him the country’s new second-richest man. — Bloomberg

P-TECH, Open P-TECH, SkillsBuild equip workforce for new collar jobs

By: Patricia Mirasol

Slug: IBM equips the global workforce for ‘new collar jobs,’ or jobs that require specialized skills but don’t necessarily require traditional four-year degrees, through free programs such as P-TECH, Open P-TECH, and SkillsBuild.

IBM continues to equip the global workforce for “new collar” jobs, or jobs that require specialized skills but don’t necessarily require traditional four-year degrees, through its free P-TECH, Open P-TECH, and SkillsBuild programs. “New collar” careers include those in the areas of cybersecurity, design thinking, and mainframe administration.

Learning pathway

Students enrolled at P-TECH, a school program that complements the K-12 system, learn topics related to STEM (science, technology, engineering, and mathematics), along with programming languages like Java and Python. In the Philippines, IBM has partnered with Taguig City University and welcomed another 110 students to the program’s fold last October, bringing the total number of enrolled students to 170.

Abigail Lesaca, P-TECH liaison, in an interview with BusinessWorld, said that participants are also exposed to discussions on ethics, critical thinking, and a better awareness of the world through modules such as “Ethics in AI (artificial intelligence): Can you crack the moral code?” and “Explorations into Mindfulness.”

“We are in discussion with the DepEd NCR (Department of Education – National Capital Region) for the possible implementation of P-TECH in some NCR public schools,” said Andrea Escalona, IBM Philippines’ corporate social responsibility country leader. She added that the company is in talks as well with the Development Academy of the Philippines and other industry associations, with the goal of having industry partners adopt the P-TECH model.

Schools that aren’t yet part of P-TECH, meanwhile, can utilize resources from Open P-TECH, a free online learning platform launched earlier this year for teachers and students at the high school and college levels. Digital badges are offered to students that complete the platform’s courses in data science, blockchain, and cloud computing.

Professional upskilling 

Although developed with students in mind, everyone can avail of Open P-TECH’s offerings. “It is open to the public and can be a resource for those who have very little background in emerging technologies,” Ms. Escalona said. “It is also for those who are looking to learn about professional topics, particularly for working professionals who want to level up or re-skill, or are just plain curious. Simply create an account on the platform and you’re good to go.”

SkillsBuild is another platform that job seekers, entrepreneurs, and job-seekers can turn to for professional development. Credentials are likewise available for those who complete courses offered in customer service, data analysis, and web development.

According to the World Economic Forum’s The Future of Jobs Report 2020, skills gaps continue to be high as in-demand skills across jobs change in the next five years. Companies estimate that around 40% of workers will require reskilling. Ninety-four percent of business leaders also expect employees to pick up new skills on the job.

MR D.I.Y. Wins its 3rd World Branding Award

Homegrown retailer from Malaysia, MR D.I.Y. Group (M) Berhad has done it again, emerging a winner at this year’s World Branding Awards! Winning the coveted national tier Brand of the Year in Retail – Home Improvement Category 2020-2021, this marks the first time a home improvement retailer has won this distinguished award for three consecutive years.

“What a way to end the year with such amazing news!” said MR D.I.Y. Group Vice President of Marketing, Mr. Andy Chin. “2020 has been a challenging yet rewarding year for all of us at MR D.I.Y., we feel incredibly fortunate to win this prestigious award for the third time in a row. This year’s win is a testament to our employees’ unwavering commitment, hard work, and dedication towards our vision of becoming the market leader in the home improvement retail industry.”

“Following the public online voting conducted by the World Branding Forum, winning this award is also proof of the public’s trust towards MR D.I.Y. as their preferred brand of choice. We cannot thank you, our customers, enough. These are trying times where many households are concerned about their finances, I want to take this opportunity to tell everyone that MR. D.I.Y. is here for you. As a homegrown, we are committed to continuously bring more value and convenience to our customers nationwide, in line with our motto of ‘Always Low Prices’” added Chin.

The World Branding Awards is an annual black-tie ceremony organized by the World Branding Forum, a global non-profit organization dedicated to advance branding principles for the benefit of customers and the branding community. The Awards honor and celebrate some of the best global and national brands for their work and accomplishments. Three streams judge the nominees, namely Brand Valuation, Consumer Market Research, and Public Online Voting.

This year’s awards ceremony will be held at Kensington Palace, United Kingdom on 11th March 2021. With previous ceremonies taking place in Vienna, New York, and Paris, this will be the eleventh Awards hosted by the World Branding Forum.

About the World Branding Awards & the World Branding Forum

The World Branding Forum (WBF) is a global, non-profit organization dedicated to advancing branding standards for the good of the branding community as well as consumers. This includes those who work in the branding, design, marketing, advertising, public relations, and communications disciplines worldwide. The WBF produces, manages, and supports a wide range of programs covering research, development, education, recognition, networking and outreach. For more information, visit brandingforum.org. The World Branding Awards is the premier award of the World Branding Forum. The Awards recognizes the achievements of some of the best brands in the world. Winners are selected based on brand valuation, market research, and online public voting. For more information, visit awards.brandingforum.org.

About MR D.I.Y.

MR D.I.Y. is the largest home improvement retailer with more than 1,300 stores across  Asia including Malaysia, Thailand, Indonesia, Singapore, Brunei, Philippines, Cambodia, and India. The home improvement retailer has dedicated to make a positive difference in the lives of its valued customers by offering convenience at all its stores nationwide.

All MR. D.I.Y. stores are managed directly and the retailer often works in collaboration with owners of shopfront properties or owners of malls. With ten departments — Hardware, Household, Electrical, Car Accessories, Stationery & Sports, Toys, Gifts, Computer & HP Accessory and Jewellery & Cosmetics — in each store, MR.D.I.Y. offers wide selections of more than 16,600 types of products at some of the lowest prices in the market.

The Company strives to put customers first by operating an innovative business that is flexible when it comes to providing a wide variety of products, good quality, and value-for-money, holding true to the Company’s motto of “ALWAYS LOW PRICES”.

 

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