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Meralco tops pandemic response communications in the 18th Philippine Quill Awards

Meralco, the Philippines’ largest electricity distribution utility, was once again among the most decorated companies in the recent Philippine Quill Awards.

The International Association of Business Communicators (IABC) Philippines awarded Meralco the Top Communication Award for COVID Communications for the entry “Meralco Digital Press Conferences: Keeping Close with Media and Public Despite Social Distancing,” along with 31 Excellence and Merit Awards for various programs. Meralco was also honored as the Company of the Year 2nd Runner Up at the virtual 18th Philippine Quill Awards. 

The Quill Award is bestowed to companies, organizations and institutions for the use of excellent communication programs, research, learning and development and skills to achieve business goals and make a difference in society.

“The COVID-19 pandemic, challenging as it is, has pushed us to transcend the boundaries of traditional communications. It made us utilize a more innovative approach as we adjusted to the limitations brought by the times,” said Meralco VP and Head of Corporate Communications Joe Zaldarriaga.

Meralco Advisory, the company’s monthly information campaign, was also recognized as a Finalist for Top Award in the Communications Management Category.

Organized by the International Association of Business Communicators (IABC) Philippines, the Philippine Quill Awards is considered the country’s most prestigious awards program in the field of business communication – emphasizing the excellent use of communication in achieving goals and in making a difference in society.

Duterte allows companies to buy coronavirus vaccines

Philippine President Rodrigo R. Duterte said he would let private companies import coronavirus vaccines amid a slow rollout of the government’s vaccination program.

“I have ordered Secretary Carlito Galvez to sign any and all documents that would allow the private sector to import at will,” he said in a televised speech on Monday night. “Whatever amount they want,” he said in Filipino.

The private sector would be allowed to buy vaccines immediately because state vaccine supply had been limited amid a “ruckus” in the global vaccine trade, Mr. Duterte said.

The government had prevented companies from importing coronavirus vaccines unless it was in coordination with the Health department.

Mr. Duterte also approved a subsidy for poor households after he placed Manila, the capital and nearby cities and provinces under a weeklong strict lockdown until April 4 amid a fresh surge in infections. About 23 million Filipinos would get P1,000 in aid each, he said.

Metro Manila and the provinces of Bulacan, Rizal, Laguna and Cavite were placed under a weeklong enhanced community quarantine this week to ease pressure on dwindling hospital beds amid a spike in daily cases.

Active coronavirus cases in the Philippines may almost quadruple to 430,000 by the end of April if stricter quarantine measures were not imposed, the Department of Health (DoH) said on Monday.

Metro Manila and the provinces of Bulacan, Cavite and Rizal were at “critical risk” given the swift rise in infections, while Laguna is at high risk, Health Undersecretary Maria Rosario S. Vergeire told an online news briefing.

DoH reported 10,016 coronavirus infections on Monday, the highest daily tally since the pandemic started last year.

Monday’s tally surpassed the 9,838 cases reported on Friday, bringing the total to 731,894, it said in a bulletin.

The death toll rose by 16 to 13,186, while recoveries increased by 78 to 603,213, it said in a bulletin.

There were 115,495 active cases, 95.9% of which were mild, 2.4% did not show symptoms, 0.7% were critical, 0.7% were severe and 0.41% were moderate.

Meanwhile, presidential spokesman Herminio L. Roque, Jr. said Santiago City and Quirino province in northern Philippines would be placed under a modified enhanced community quarantine starting next month.

The Cordillera Administrative Region, Isabela, Cagayan, Nueva Vizcaya and Batangas would be placed under a general community quarantine. 

Also placed under a general lockdown were the cities of Tacloban, Iligan and Davao and Lanao del Sur province, he said.

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Car industry eyes recovery in 2023

By Jenina P. Ibañez, Reporter

THE AUTO INDUSTRY expects to recover back to pre-pandemic sales as late as 2023 after operations suffered from the effects of the pandemic, Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) President Rommel R. Gutierrez said.

Mr. Gutierrez, who is also first vice-president at Toyota Motors Philippines, said the stricter lockdown last year caused a sales slump and a two-month long plant production shutdown followed by limited plant operations.

“It took us until September that we were able to go back to two (production) shifts,” he said at a BusinessWorld Velocity online event on Monday. The Taal Volcano eruption early last year also caused delivery disruptions, he added.

“Conservatively, around two years from now, 2023, that’s our (recovery) projection,” Mr. Gutierrez said, noting that this would be achievable if there are certainties in the market, consistent government policies, and widespread inoculation against coronavirus disease 2019 (COVID-19).

Car sales for 2020 declined 39.5% to 223,793 units, data from CAMPI and Truck Manufacturers Association (TMA) showed.

Despite the decline, Mr. Gutierrez said car companies were able to launch products online.

“Internally, we also had the chance to adjust our business plan — the way we do things. We were able to identify those tasks that need to stop to those tasks that we think we can continue doing,” he said.

Mr. Gutierrez said he is cautiously optimistic about sales this year. The industry sold 26,230 vehicles in February, down 12% from 29,790 units in the same month last year but 12.2% up from January levels.

“We’re happy with that figure, February sales figure, but again we don’t know what will happen in the coming months,” he said, adding that car companies are also looking to tap the growing logistics requirements in the country.

The best-case scenario for the industry in 2021, Mr. Gutierrez said, is a 30-35% sales growth. But safeguard duties on imported cars, which he said is derailing the industry’s recovery efforts, could lower growth to 20-25% compared with last year’s figure.

The Department of Trade and Industry (DTI) imposed 200-day provisional safeguard duties on imported cars to protect local jobs after it found a link between a decline in local industry employment and an import surge, based on a petition from an auto parts labor group.

The Safeguard Measures Act or Republic Act No. 8800 allows domestic producers to ask the government to conduct an investigation into their import competitors if they claim to have been injured by excessive imports. Car manufacturers have started collecting deposits from customers for imported cars while the Tariff Commission conducts its own investigation.

Mr. Gutierrez said that the duties are causing market uncertainties as prices go up.

“The industry, in order for it to survive, would have to have local production as well as importation of motor vehicles,” he said.

PHL secures P58-B loans for COVID-19 vaccines

By Beatrice M. Laforga, Reporter

THE PHILIPPINE government has obtained loans from three multilateral lenders worth a combined $1.2 billion (P58 billion) to buy much-needed coronavirus disease 2019 (COVID-19) vaccines, the Department of Finance (DoF) said on Monday.

This as the Health department reported 10,016 new coronavirus infections, the third record daily increase in the last five days.

The DoF on Monday held a virtual launch event for the loans — $500 million from the World Bank, $400 million from the Asian Development Bank (ADB), and $300 million from the Asian Infrastructure Investment Bank (AIIB).

The loans from the ADB and the World Bank were signed on March 19, while the co-financing agreement with the AIIB was scheduled to be signed on Monday, Finance Secretary Carlos G. Dominguez III said.

The DoF chief said the multilateral lenders will help the government procure the COVID-19 vaccines, pay the manufacturers directly and deliver the supplies to the country.

The government will handle the costs of delivering the vaccines across health centers and other expenses in administering the doses.

“The prompt and substantial financing extended by our multilateral partners will help accomplish the government’s target to inoculate at least 70 million Filipinos, or 100% of our adult population. We are committed to accelerate the rollout of our vaccination program so that we can safely open up our economy and restore the jobs of our people,” Mr. Dominguez said.

The foreign loans will partially fund the P72.5-billion mass vaccination program of the state.

During the launch, ADB Vice-President Ahmed Saeed aired concerns over the limited supply of vaccines in the international market since wealthier countries have pre-ordered vaccine supplies for the next six months.

“The world simply does not have enough vaccines and, on top of that, wealthy nations are building stockpiles through precommitment of most of the production that will become available over the next 6 months. This has made it difficult for developing countries to secure vaccines and is leading to slow vaccine rollouts,” Mr. Saeed said.

The vaccine loans will add to the $14.29-billion foreign loans the government obtained so far to boost its war chest against the coronavirus pandemic.

“We appreciate our multilateral partners’ responsiveness and flexibility in providing appropriate and timely financing support to cater to our specific needs during this pandemic. They stood side by side with us throughout this battle by giving us the ample ammunition we need to quickly recover from this health crisis,” Mr. Dominguez said.

“Our multilateral partners’ swift response to our call for support reflects their confidence in the Philippines’ capability to effectively implement our COVID-19 response measures, including our national vaccination program,” he added.

Gov’t sets P170-B borrowing plan for April

THE GOVERNMENT increased its borrowing program for the domestic bond market to P170 billion in April to take advantage of the abundant liquidity.

The Bureau of the Treasury (BTr) is set to borrow P100 billion during weekly offering of Treasury bills (T-bills) and another P70 billion via fortnightly auctions of Treasury bonds (T-bonds), based on an advisory posted on its website on Monday.

The P170-billion latest borrowing program is higher than the P160-billion target in March, but still lower than the P190-billion planned borrowings in April 2020 — one year since the Treasury shifted to a monthly auction schedule from the previous quarterly program amid the coronavirus pandemic.

National Treasurer Rosalia V. de Leon said the government increased the program to “take advantage of good liquidity conditions.”

The BTr raised the volume of T-bills to be offered every Monday to P25 billion from the previous P20 billion.

It will now auction off P5 billion in 91-day papers, P8 billion in 182-day debt and P12 billion in 364-day securities.

The initial program for T-bonds was raised to P35 billion from P30 billion previously, but shortened the tenors.

The Treasury is set to raise P35 billion in five-year bonds on April 6, and another P35 billion via the seven-year notes on April 20.

The BTr raised P169 billion from the domestic bond market so far this month, excluding the results of the tap auction on Monday.

The actual debt was higher than the programmed P160 billion after it opened the tap facility for T-bills twice and upsized the volume of bills accepted on Monday when rates fell across the board. This was composed of P109 billion in T-bills and P60 billion in T-bonds.

The government is looking to borrow P3 trillion this year from domestic and external lenders to help fund its budget deficit seen to hit 8.9% of gross domestic product. — Beatrice M. Laforga

Over P150B in bad assets likely to be disposed under FIST law — BSP

By Luz Wendy T. Noble, Reporter

BANKS are expected to dispose of at least P152 billion in nonperforming assets (NPAs) as they take advantage of the Financial Institutions Strategic Transfer (FIST) Act, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said.

“During the Asian Financial Crisis, around 30% of the banks’ NPAs were sold under the Special Purpose Vehicle (SPV) Act,” Mr. Diokno said at an online briefing on Thursday.

“One estimate is that the same proportion of NPAs will be sold by BSP-supervised financial institutions under the FIST Act. This translates to at least P152 billion in NPAs or 30% of the banking system’s total NPAs as of Dec. 31, 2020,” he added.

Republic Act No. 11523 will allow financial institutions to clean up their balance sheets by offloading NPAs and bad loans to so-called FIST Corporations (FISTC). Its precursor, Republic Act 9182 or SPV Act of 2002, was implemented after the Asian Financial Crisis.

Mr. Diokno has earlier said FIST is expected to reduce the NPL ratio by about 0.63 to 0.73 percentage points.

Latest data from the BSP showed the nonperforming loan (NPL) ratio held by big banks stood at 3.7% in January, up from the 3.61% in December and 2.16% in January 2020. This is equivalent to P392.256 billion of bad loans, climbing 67% from the P234.987 billion seen in January 2020.

Meanwhile, BSP Office of the General Counsel and Legal Services Deputy Director Noel Neil Q. Malimban said there has been some interest from financial institutions regarding the FIST Act.

FIST Corporations will be granted with tax perks for the processes to be undergone in the implementation of the law.

Philippine National Bank Executive Vice-President and Chief Financial Officer Nelson C. Reyes said earlier this month that they are interested in tapping the provisions of the law to take advantage of its benefits to their capital.

IMPLEMENTING RULES
Meanwhile, the Securities and Exchange Commission (SEC), the Department of Finance (DoF), BSP, the Bureau of Internal Revenue (BIR), and the Land Registration Authority (LRA) released the implementing rules and regulations (IRR) of the FIST Act on Monday.

“The commission has always supported the passage of the FIST Act. With the implementing rules and regulations in place, we are optimistic that the law will serve its purpose of ensuring the resilience and recovery of the financial sector, which in turn will provide the much-needed support for businesses and consumers alike,” Emilio B. Aquino, SEC chairperson, said in a statement on Monday.

The law allows for the creation of corporations with a primary purpose of investing in or acquiring NPAs of covered financial institutions. The SEC is the primary implementing agency of the FIST Act.

“If the FISTC will acquire land, at least sixty percent (60%) of its outstanding capital stock shall be owned by Philippine nationals as defined under the FIA (Foreign Investment Act),” the IRR stated.

Foreign equity participation will also be subjected to guidelines under the FIA.

The minimum authorized capital stock of FISTCs should amount to P500 million, with a minimum subscribed capital stock of P125 million, and a minimum paid-up capital of P31.25 million.

FIST Corporations are considered vested with public interest. It should have independent directors on its board, appoint a compliance officer and submit reports on compensation and performance.

“Applications for the establishment and registration of a FISTC shall be filed with the commission within thirty-six (36) months from the effectivity of the Act,” the IRR said.

FISTCs created on the 25th and the 36th months from the Act’s effectivity will not be subjected to the tax incentives, unless a law extending the privileges is passed. — with Keren Concepcion G. Valmonte

BIR allows filing, payment of tax returns ‘anywhere’

THE BUREAU of Internal Revenue (BIR) is now allowing taxpayers to file their tax returns and make payments “anywhere” in the country, amid the surge in coronavirus infections.

BIR Commissioner Caesar R. Dulay issued Revenue Memorandum Circular No. 41-2021 on Monday, allowing the filing of returns and payment of taxes, whose deadlines fall between March 22 to April 30, “anywhere, even outside the jurisdiction of the Revenue District Office where they are registered.”

For taxpayers not required to use the Electronic Filing and Payment System (eFPS) and eBIRForms system, the BIR urged them to file their returns through the eBIR Forms facility and pay taxes through online payment channels.

“This circular is being issued in order to provide relief to taxpayers, in relation to the current surge in COVID-19 cases that is affecting the entire country which has prompted establishments to operate at half their manpower capacity,” the BIR said in the circular.

Taxpayers are previously required to file and pay their tax returns in the Revenue District Office they were registered or face penalties, BIR Deputy Commissioner Arnel SD. Guballa explained on Monday. — Beatrice M. Laforga

UN chief flags COVID-19 debt crisis for developing world

UNITED NATIONS Secretary-General Antonio Guterres said the world faces intense issues of debt sustainability because of the coronavirus crisis that have not been properly understood or addressed, the Financial Times reported on Monday.

“The response to COVID and to the financial aspects [of the crisis] has been fragmented, and geopolitical divides are not helping,” Mr. Guterres told the FT.

Countries such as Brazil and South Africa had borrowed heavily from domestic lenders rather than from foreign investors, at interest rates much higher than those available to rich countries, making the dangers less visible than in previous emerging market debt crises, according to Mr. Guterres.

“They are essentially borrowing in the internal market but maturities are coming down,” Mr. Guterres told FT. “This is a very bad signal.” — Reuters

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