Cemex PHL targets profitability in three years

January 21, 2025 | 12:05 am

CEMEX Holdings Philippines, Inc. (CHP) expects profitability in three years as the cement company pushes for a financial turnaround.

“Our target is profitability in three years. There are a lot of things to do. There is room for improvement,” CHP President and Chief Executive Officer Herbert M. Consunji told reporters on the sidelines of an event in Taguig City last week.

“It cannot be immediate because we are coming from a net loss,” he added.

Mr. Consunji said that CHP, the country’s fourth-largest cement producer, is looking to implement operational efficiencies to boost its financials.

“At least to go above water. We have a lot to fix in the operations,” he said when asked about CHP’s target this year.

Mr. Consunji said that CHP hopes to reduce its losses this year amid recent cost-cutting initiatives.

“A lot will be removed, such as expenses, royalties, and so on. Although the interest costs are high again. We will try everything,” he said.

Following the announcement of CHP’s acquisition, DMCI Holdings, Inc. Chairman and President Isidro A. Consunji said in April last year that the cement manufacturer is expected to have a financial turnaround this year, led by stronger demand and the government’s infrastructure program.

On Nov. 29, CHP completed the sale of its shares in foreign reinsurance unit Falcon Re Ltd. to Torino Re Ltd. for $3 million.

CHP also previously sold its entire stake in Swiss-based Cemex Asia Research AG to Cemex Innovation Holding AG for $900,459.

On Dec. 2, Consunji-led companies DMCI Holdings, Inc., Semirara Mining and Power Corp. (SMPC), and Dacon Corp. finalized the purchase of Cemex Asian South East Corp. (CASEC), which owned 89.86% of CHP.

The deal was valued at $272 million and marked the Consunji group’s entry into the cement manufacturing business.

DMCI clinched a 51% effective stake in CHP, while Dacon Corp. and SMPC accounted for 29% and 10%, respectively, at the financial close of the transaction.

For the first nine months, CHP increased its net loss by 131% to P2.87 billion due to lower cement prices, higher financial expenses, and higher income tax expenses year-over-year.

Revenue declined by 9.4% to P12.21 billion due to intense industry competition and lower cement prices.

CHP shares fell by 1.12% or two centavos to P1.77 apiece on Monday. — Revin Mikhael D. Ochave

LANDBANK and DBP recapitalization: How feasible (or can this IPO fly?)

January 21, 2025 | 12:04 am

AS A FOLLOW UP to my piece on October 2023 about the negative impact of the equity investment into the Maharlika Investment Corp. (MIC) on the capital ratios of Land Bank of the Philippines (LBP) and the Development Bank of the Philippines (DBP), my “Introspective” piece on Jan. 6 this year showed that after one year, the DBP remained slightly below the 10% regulatory minimum for Common Equity Tier 1 (CET1) through 2023, while the LBP’s numbers were already above minimum and significantly improved during 2023.

This writer has come upon new information that shows that the LANDBANK and DBP capital ratios are actually better than earlier computed. BSP Circular No. 781 series of 2013 (Part II, Item 9) — also published as Annex 59 of the Manual of Regulations for Banks (MORB) of 2021 — provides that “Any asset deducted from qualifying capital in computing the numerator of the risk-based capital ratio shall not be included in the risk-weighted assets in computing the denominator of the ratio.” Credit to LANDBANK President Lynette Ortiz and her Controllership group for pointing out Circular 781.

Based on the accompanying table, the DBP’s adjusted CET1 ratio by end 2023 was at 9.47%. If the DBP just records the same income for 2024 as it earned in 2023 (no profit growth) and its Risk weighted assets (RWA) grows minimally instead of contracting again, my estimate of its adjusted CET1 ratio of 10.35% will have met the 10% regulatory minimum. Hence, DBP President Michael de Jesus was correct in saying that “DBP… will meet the minimum capital ratios based on the results of 2024.”

In contrast, the Department of Finance (DoF) statement citing healthy Capital Adequacy Ratio (total CAR) for LBP at 16.42% and DBP at 14.78% as of November 2024 (https://tinyurl.com/2csrrx6o) is misleading on two counts — first, it refers only to the total CAR not CET1, and, second, the number does not account for capital deduction from the Maharlika Investment Fund (MIF) equity investment. The correct number is the CET1 adjusted for MIF equity.

RECAPITALIZATION OR IPO
This writer called out the recent IMF call for the immediate recapitalization of both government financial institutions (GFIs) so they could exit regulatory relief as half-wrong and one year late. Based on the updated/adjusted figures, the IMF was wholly wrong, since even the DBP would already be compliant by the end of 2024.

At the start of his term as Secretary of Finance, Secretary Ralph Recto announced the possibility of an initial public offering (IPO) for LBP and DBP to bolster their capital ratios. (“IPO seen to strengthen Land Bank, DBP,” Philippine Daily Inquirer, Feb. 23, 2024). This followed his announcement of the scrapping of the merger of LANDBANK and the DBP as proposed by his predecessor, Ben Diokno.

Bills were filed in Congress to amend the GFIs respective charters — Senate Bill 2804 (Senators Mark Villar and Francis Escudero) and House Bills 10720 (Rep. Bernadette Escudero) and 10817 (Rep. Wowo Fortes) for the DBP, and Senate Bill 2760 for LBP (Senator Escudero).

This piece discusses whether the proposed amendments to the charters of the LBP (RA 3844, as amended) and the DBP (RA 8523 amended by EO 81) are supportive of their recapitalization, and whether it can lead to a successful IPO.

The critical factors are the increase in authorized capital, the building blocks in governance structures necessary for a successful public listing, and whether market conditions are favorable for such a public listing.

INCREASE IN AUTHORIZED CAPITAL
To pay for the additional paid-in capital called for by proposed charter amendments, the National Government has to infuse a total of P66.5 billion in paid-in capital to both GFIs, broken down as follows:

1. LBP, P50 billion. The proposed increase in authorized capital from P200 billion to P1 trillion (Section 6, SB 2670), means an increase of P800 billion. Under the Revised Corporation Code (RCC), 25% or P200 billion of this increase in authorized capital has to be subscribed. And 25% of the incremental subscription is P50 billion. This amount is exactly the P50 billion taken out of LBP for investment in Maharlika.

2. DBP, P16.562 billion. Authorized capital from P35 billion — of which P32 billion currently paid up — to P300 billion, or an increase of P265 billion (Section 7, SB 2804 and HB 10720, HB10817). Incremental subscription of 25% amounts to P66.25 billion; the corresponding additional paid up 25% of subscribed is P16.5625 billion. This additional paid-in capital of P16.562 is less than the P25 billion transferred to Maharlika.

The idea of the National Government having to recapitalize LBP and DBP to the tune of P66.5 billion raises a most basic question — why did they have to take out the capital from both GFIs in the first place?

How will the National Government infuse the additional paid in capital?

Option 1. Infuse cash. Very unlikely, given fiscal constraints such that DoF even had to resort to “sweeping” the so-called “excess funds” from various GOCCs — including PhilHealth and Philippine Deposit Insurance Corp.

Option 2. Extended “Dividend relief.” Most likely, both GFIs will be exempted from RA 7656 requiring them to declare 50% of their net income as dividends, until their capital build up meets the target amount. At current rates, this could take two to three years for the LBP and three to four years for the DBP. This “dividend relief” is completely separate from “regulatory relief” from minimum capital ratios, which is no longer an issue by end 2024 for DBP and was never an issue for LBP.

BUYING SHARES
Will the investing public be allowed to buy LBP and DBP shares? Yes.

Their original charters provide that only the National Government can own their shares. The proposed amendments now allow them to issue common and preferred shares (DBP Section 6, item k; for LBP Section 3 item n). The National Government will retain majority ownership of 70% while Government-Owned and -Controlled Corporations (GOCCs) can buy non-voting preferred shares of both GFIs.

THE MISSING INGREDIENTS
The following are missing in the proposed charter amendments:

1. No provision for an independent external auditor aside from the Commission on Audit (CoA). This is an important governance element if the goal is to attract local and foreign investors and strategic partners. This provision for a third-party independent external auditor (on top of the CoA audit) was incorporated in the House version and RA 11954 creating the Maharlika Investment Fund. (Thank you, Congressman Joey Salceda for adopting this suggested amendment to the bill.)

2. No clear provision for the timely filing of audited financial statements (AFS) with the local stock exchange. A third-party external auditor would improve this timeline significantly towards global standards. The best practice under the ASEAN Corporate Governance Scorecard (ACGS) is to file the audited financial statement (FS) within 90 calendar days from end of the calendar year — March 1 or Feb. 29 (for leap years). In contrast, the CoA-audited FS 2023 for the DBP became available only in June 2024 while that of the LBP in September 2024 (October 2023 for the 2022 AFS). This late filing/disclosure would be unacceptable to private investors, as it would mean a very late annual stockholders’ meetings.

3. No provision for an annual stockholders’ meetings (ASM), at which the management and the board of directors report to the shareholders — with new stockholders (local and foreign, institutional and retail) — the results of the prior year and secure stockholders’ ratification for the acts of the board and management. The declaration of dividends is announced at the ASM, following an approved dividend declaration policy. The appointment of the third-party external auditor is also approved by the stockholders upon recommendation of the board and its audit committee.

This is what Foundation for Economic Freedom President Calixto “Toti” Chikiamco meant in his statement supporting the announced IPO that “apart from strengthening their balance sheets, being publicly listed will help in bank governance as the boards and managements must answer not only to the government but also to private investors.”

Even if all the building blocks for an IPO are in place, will the shares of the LBP and the DBP be attractive to investors? The short answer is NOT AT THE PRESENT TIME.

1. Investors expect an IPO company to have a track record of consistent and solid returns which underpins their expectations of dividends and stock price appreciation. Both GFIs need several years to establish this track record. They also need to get past the historical narrative of having to request for regulatory relief and dividend relief, and having been receptacles for “behest” loans in the past.

2. Market conditions not favorable. As of the end of December 2023. only three banks listed in the Philippine Stock Exchange have share prices above book value — Banco de Oro, Bank of the Philippine Islands, and China Banking Corp.(disclosure: this writer was head of investor relations for China Bank for 27.5 years until retirement three years ago). The rest of the listed banks are trading below book despite delivering return on equity of 15-16% in the previous few years.

In conclusion: the proposed charter amendments are steps in the right direction, but a few crucial elements are still missing. Once enacted, the revised charters (hopefully revised to fill in the “missing ingredients”) will be a good foundation for a successful IPO. The increase in paid-in capital has to happen first, which will boost their capacity to perform at a higher trajectory. Thereafter, a good track record and favorable market conditions augur well for a successful IPO.

Alexander C. Escucha is president of the Institute for Development and Econometric Analysis, Inc. (IDEA), and chairman of the UP Visayas Foundation, Inc. He is a fellow of the Foundation for Economic Freedom and a past president of the Philippine Economic Society. He is an international resource director of The Asian Banker (Singapore).

alex.escucha@gmail.com

Chinese forms of expression at the 19^th Spring Film Festival

January 21, 2025 | 12:04 am

A WIDE variety of Chinese films and other creative endeavors — like dance, traditional music, and calligraphy — will be in the spotlight for this year’s Spring Film Festival at the Shangri-La Plaza Mall in Mandaluyong City.

The 19^th edition of the film festival will run from Jan. 29 to Feb. 2, during which time four Chinese films will be screened for free.

One is Foo Sing-Chong’s 2015 3D-animated comedy Where’s the Dragon?, which features a star-studded voice cast including Zhang Ziyi. It follows a 10-year-old girl who goes on an adventure with the animals of the Chinese zodiac in search of the missing dragon.

Those looking for a bittersweet romance can watch Somewhere Winter (2019) by Wang Weiming. The story is based on a novel by Rao Xueman, where young love blooms between a Chinese student and a Taiwanese photographer and this love is put to the test by familial pressures.

Find Your Voice (2020) by Adrian Kwan is a drama about a renowned conductor in the United States returning to his native Hong Kong to mentor a choir of pessimistic students. With Andy Lau in the lead role, the film aims to show how music can inspire.

For those who enjoy comedy-drama, One More Chance (2023) by Anthony Pun promises humor and redemption for its flawed main character. Here, Chow Yun-fat plays a compulsive gambler who must step up to support his son with autism.

Admission to the screenings throughout the five days is free. Tickets are given on a first-come, first-served basis.

DANCE AND CALLIGRAPHY
Aside from watching films, visitors can partake in several other activities.

There will be a calligraphy workshop on Feb. 1 at the mall’s Grand Atrium, where an instructor will talk about the art of Chinese calligraphy. On Feb. 2, a Chinese music concert will feature performers who will stage traditional songs and dances.

From Feb. 1 to 2, there will be a cultural bazaar offering Chinese snacks and items also at the Grand Atrium.

The film festival, which will be held at the Red Carpet Cinemas of the mall, is organized by the Ateneo Ricardo Leong Center for Chinese Studies in partnership with Ateneo de Manila University’s Chinese-Filipino organization Celadon, and in cooperation with the Film Development Council of the Philippines.

For the full screening schedule and more information, visit the Spring Film Festival and Shangri-La mall social media pages. — Brontë H. Lacsamana

PSE acquiring more PDS shares

January 21, 2025 | 12:04 am

THE Philippine Stock Exchange, Inc. (PSE) is increasing its stake in the Philippine Dealing System Holdings Corp. (PDS) to 88.44%.

The market operator is buying 250,000 PDS common shares held by AIA Philippines Life and General Insurance Co. Inc., equivalent to a 4% stake, under a share purchase agreement.

“With this acquisition, the company will own a total of 88.44% of PDS, inclusive of the company’s existing 20.98% equity interest,” the PSE said in a regulatory filing on Monday.

“The acquisition is subject to customary closing conditions such as the required corporate approvals and delivery of closing certificates,” it added.

The PSE also previously entered into a share purchase agreement with the Financial Executives Institute of the Philippines Research and Development (FINEX) Foundation to acquire 96,388 common shares of PDS, equivalent to a 1.54% stake.

In December, the PSE secured a P2.32 billion deal with various shareholders to acquire their stakes in PDS as part of unifying the local capital markets.

The deal consisted of 3.87 million PDS shares at P600 apiece, equivalent to a 61.92% stake.

The PSE signed term sheets with the Bankers Association of the Philippines (BAP) for its 28.83% stake, as well as with Mizuho Bank Ltd. for its 0.08% stake.

The market operator also signed share purchase agreements to acquire Singapore Exchange Ltd.’s (SGX) 20% stake, Whistler Technologies, Inc.’s (WTSI) 8% stake, San Miguel Corp.’s (SMC) 4% stake, the Investment House Association of the Philippines’ (IHAP) 0.65% stake, and Golden Astra Capital, Inc.’s 0.36% stake.

The PDS owns fixed income exchange operator Philippine Dealing and Exchange Corp., as well as the equities and fixed income securities depository Philippine Depository & Trust Corp.

The PSE said the acquisition of PDS will provide investors with a facility to trade fixed income, equities, and other products in a unified marketplace.

“These signed agreements bring us a step closer to achieving our objective of consolidating the equities and fixed income exchanges and realizing the synergies and efficiencies from this unified setup,” PSE President and Chief Executive Officer Ramon S. Monzon said.

“This will also allow us to be instrumental in the growth and development of the Philippine capital market with the introduction of new products for various stakeholders as well as the implementation of risk management processes,” he added. — Revin Mikhael D. Ochave

Gov’t upsizes T-bill award as yields drop further

January 21, 2025 | 12:04 am

THE GOVERNMENT hiked the volume of Treasury bills (T-bills) it awarded on Monday as rates dropped further on market preference for shorter tenors and amid expectations of a rate cut by the Bangko Sentral ng Pilipinas (BSP) next month.

The Bureau of the Treasury (BTr) raised P27.6 billion from the T-bills it auctioned off on Monday, higher than the initial P22-billion plan, as total bids reached P93.89 billion, more than four times as much as the amount on offer. This was also slightly higher than the P93.776 billion in tenders seen on Jan. 13.

The strong demand led the Treasury to double the accepted non-competitive bids for the three- and six-month T-bills to P5.6 billion each, it said in a statement.

Broken down, the Treasury borrowed P9.8 billion from the 91-day T-bills, higher than the programmed P7 billion, as tenders for the tenor reached P34.41 billion. The three-month paper was quoted at an average rate of 5.165%, falling by 42.3 basis points (bps) from the 5.588% seen at the previous auction, with accepted rates ranging from 5.048% to 5.244%.

The government likewise made a P9.8-billion award of the 182-day securities, above the P7-billion program, as bids stood at P30.25 billion. The average rate of the six-month T-bill stood at 5.503%, dropping by 13.5 bps from the 5.638% fetched previously, with accepted bid rates at 5.423% to 5.58%.

Lastly, the Treasury raised P8 billion as planned via the 364-day debt papers as demand for the tenor totaled P29.23 billion. The average rate of the one-year debt decreased by 5.1 bps to 5.84% from 5.891% last week, with bids accepted carrying rates of 5.82% to 5.845%.

At the secondary market before the auction, the 91-, 182-, and 364-day T-bills were quoted at 5.4973%, 5.6265%, and 5.8954%, respectively, based on PHP Bloomberg Valuation Service (BVAL) Reference Rates data provided by the Treasury.

“Treasury bill average auction yields declined for the third straight week after the latest week-on-week decline in most short-term PHP BVAL yields to the lowest in two to three months on a possible local policy rate cut as early as the first BSP rate-setting meeting in 2025,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

The government upsized its T-bill award as rates of the debt papers continued to drop amid strong demand, a trader said by phone. “A lot of investors are repositioning in the shorter tenors for the start of the year.”

The Monetary Board will hold its first policy meeting for this year on Feb. 20.

BSP Governor Eli M. Remolona, Jr. this month said the central bank still has room to continue cutting interest rates as inflation is well within its annual goal, adding that current benchmark borrowing costs remain “restrictive.”

He previously said 100 bps worth of cuts this year may be “too much” amid inflation concerns.

The Monetary Board has slashed benchmark borrowing costs by a total of 75 bps since it began its easing cycle in August, bringing its policy rate to 5.75%.

Expectations of further monetary easing by the US Federal Reserve this year following the release of soft economic data also caused T-bill yields to decline, Mr. Ricafort added.

On Tuesday, the BTr will offer P30 billion in reissued 10-year Treasury bonds (T-bonds) with a remaining life of nine years and 14 days.

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

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

Damosa’s Bridgeport Park condo seen completed by 2028

January 21, 2025 | 12:03 am

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DAVAO-based property developer Damosa Land, Inc. (DLI) expects to complete the construction of its Bridgeport Park condominium by 2028, according to its chief executive officer (CEO).

“For Bridgeport Park, which is our condo project there, there are four buildings, with a total value of about P2.3 billion,” Damosa President and CEO Ricardo F. Lagdameo said in an interview with BusinessWorld.

“We launched that two years ago, and it is currently under construction. We’ve sold out probably close to 85% of that project already,” he added.

The project is within Bridgeport, a 13-hectare mixed-use development inspired by the architectural style of the United States East Coast area.

It is located in Barangay Caliclic, Samal Island, Davao del Sur, offering scenic views of the Davao Gulf and Mount Apo.

The first tower within Bridgeport Park, Azure, will be completed by April this year, with the turnover of units on track by the second quarter.

The second tower, called Sapphire, is targeted for completion by the first quarter of 2026.

Meanwhile, the third (Royal) and fourth (Navy) towers will be finished by early 2027 and 2028, respectively.

As of Dec. 31, DLI has sold 228 out of the 274 target units within Bridgeport Park. The average price of a unit is around P200,000 per square meter (sq.m.).

Main doors in all Bridgeport Park units will have a smart lock that allows owners to enter via RFID key tag, passcode, or through their mobile app, according to the company.

Road networks within Bridgeport Park have been “substantially completed,” and all underground utilities are fully installed, the company noted.

The construction of its hiking path and sewage treatment plant is underway, while the clubhouse is likely to be completed by the second quarter of 2025.

Also near Bridgeport Park is about 18,000 sq.m. of open space for road networks, parks, green spaces, and exclusive amenities.

Bridgeport is also home to a gated subdivision called the Harborview Estates, a lighthouse, and a marina managed by the Davao Boat and Leisure Club.

The development also features a 1,200 sq.m. exclusive events place called The Shipyard, which can cater to up to 500 guests. — Beatriz Marie D. Cruz

Management excellence for a progressive Philippines

January 21, 2025 | 12:03 am

employee-organization — KATEMANGOSTAR/FREEPIK

(This was lifted from the Inaugural Address of the author as the 77^th President of the Management Association of the Philippines.)

As in the past, the Management Association of the Philippines’ (MAP) activities this year will be guided by a theme.

For 2025, we will once again build on MAP’s legacy, its strengths, while forging forward to a relevant and progressive future.

For MAP’s 75^th Year — our Diamond Anniversary — we have chosen a theme aligned with MAP’s mission of promoting management excellence for nation-building. The MAP Board of Governors has chosen the theme: “Management excellence for a progressive Philippines.”

To continue and sustain the noteworthy projects that were initiated or implemented by last year’s Board, MAP will continue to pursue the following four thrusts:

1. Member Engagement,

2. Country Competitiveness,

3. ESG and Shared Prosperity, and,

4. Investing in the Youth.

Last year, there were five thrusts. This year, these were merged into four. Last year’s Cluster on Innovation, Technology and Digitalization has been merged into the Cluster on Country Competitiveness, not so much because there is less to do, but because our hope is that in focusing, we sharpen the impact.

It will be a bottom-up process, where we will work with the committees with all their initiatives, and these will be presented to the Board.

MEMBER ENGAGEMENT
We will continue to ensure the relevance of the topics and issues covered in the MAP general membership meetings or GMMs in order to engage the membership in a more meaningful way. We will cover relevant topics and developments so as to benefit the members, their companies, and the economy.

We will hold two to three GMMs outside Metro Manila (MM), so we can engage our members in the Visayas and Mindanao. Through technology and its proactive application, we will continue enabling virtual participation of members outside MM in our various activities. This will enable MAP to help expand business and economic development benefits to the rest of the country.

COUNTRY COMPETITIVENESS
We will continue to push for vital policy reforms, through executive or legislative action, that will eliminate corruption, improve the ease of doing business, ensure food security through agricultural productivity, and sustain an enabling business environment for local and foreign investors. The aspiration is to attract greater and more diverse job-creating investments for more Filipinos to be gainfully employed.

ESG AND SHARED PROSPERITY
We will continue advancing Environmental, Social, and Governance (ESG) principles and fostering Shared Prosperity as a key strategic thrust for the year. By integrating sustainable practices, promoting ethical leadership, and driving inclusive growth, we aim to create long-term value for MAP members and all other stakeholders. We will continue pushing for the discourse and activities to champion responsible business, uplift communities, and contribute to a resilient and equitable future for the Philippines.

INVESTING IN THE YOUTH
We will continue the Campaign Against Malnutrition and Child Stunting or CAMACS and we will continue advocating for government and the private sector to pursue relevant education, health and wellness programs, particularly for the youth. The objective is for the youth to become productive members of society, with competitive skills and capacity that will ensure a progressive economy of the future.

MAP MEMBERS’ TOP 7 CONCERNS FOR 2025
We did a survey late last year, and we will certainly address the top seven concerns of MAP members:

1. Corruption

2. Education

3. Economy

4. Ease of Doing Business (EODB)

5. Climate Change

6. Cybersecurity

7. Dealing with LGUs

Please note that all your top seven concerns will be directly addressed by the four thrusts that I have explained.

To address Corruption and EODB, we will continue to participate actively in the programs of the Anti-Red Tape Authority (ARTA).

MAP COMMITTEES UNDER FOUR CLUSTERS
In general, we will build on MAP’s ongoing activities that benefit our members and other stakeholders.

While focusing on the four main thrusts, we will continue to pursue other advocacies and programs to adapt to developments in the domestic and global landscape.

Your 2025 Board will work with the 25 MAP committees which shall be grouped according to our four main thrusts for 2025:

1. The Member Engagement group will be headed by yours truly, VP Mike Toledo and Noel Bonoan.

2. The Country Competitiveness group will be headed by Rene Almendras and Gil Genio.

3. The ESG and Shared Prosperity group will be led by Rex Drilon II.

4. The Investing in the Youth group will be handled by Paolo Borromeo and Maan Hontiveros.

MAP’S 75^TH ANNIVERSARY ACTIVITIES
As I mentioned earlier, MAP is turning 75 this year and we have lined up the following activities, among others, to commemorate this very important landmark in the history of our Association:

1. We will have an Anniversary Dinner-Concert with the Manila Symphony Orchestra in July.

2. We will develop an updated MAP video that can be used in succeeding years, regardless of who the next MAP President will be. So, it will be a timeless video for the association. We hope to launch the new MAP Video during the Anniversary Dinner.

We will certainly have other activities in celebration of this milestone. And definitely, we will announce all these in due time as we are able to develop the said programs.

Before I close, I’d like to assure everyone that on our Diamond Year, we will not just commemorate the past — we will fortify and lay the seeds in shaping the next 75 years and beyond.

We, in the Board — hand in hand with each one of you, our MAP members, particularly all the Committee Chairs and Vice-Chairs — know that with your active participation and support, 2025 will see the realization of these goals into real change and meaningful impact.

Thank you for your trust, your passion, and your commitment. Let’s make 2025 a year of progress — not just for MAP, but for the Philippines.

Aside from being the 77^th President of the MAP, Alfredo S. Panlilio is also the Chair of Maya Bank.

map@map.org.ph

A song of tenacity

January 21, 2025 | 12:03 am

By Brontë H. Lacsamana, Reporter

Movie Review
Song of the Fireflies
Directed by King Palisoc

EVERYONE loves a good underdog story, especially if it involves the overlooked and unconfident coming into their own after much perseverance. In this film, the underdogs are the children who grew up surrounded by the untamed bounty of nature, and a kind-hearted teacher keeping the musical activities of a provincial school afloat, deep in the island of Bohol.

The film tells the origin story of the world-renowned Loboc Children’s Choir (LCC) of Bohol. It is charming and inspiring. Scenes that show the kids’ angelic choral singing, which elevated them to stardom, paired with the serene landscapes of their home by the Loboc River, are enough to keep the average viewer entranced. Song of the Fireflies is a straightforward underdog tale in this beautiful setting, but it is also grounded by the cutthroat, competitive realities that often wear down those who aspire to succeed in the big city.

The film, starring Morrissette Amon, Rachel Alejandro, Krystal Brimner, and Noel Comia, Jr., takes place in the 1980s, when the real-life LCC and its teachers and benefactors began their whirlwind ascent.

Pong Ignacio’s relaxed and picturesque cinematography and the warm and familiar compositions by Ryan Cayabyab, Louie Ocampo, Raymond Marasigan, and Jazz Nicolas (the film’s musical direction is by Krina Cayabyab) gain easy praise. Many will likely look for the original film soundtrack that producers have said will be released soon. But it is writer Sarge Lacuesta and director Mr. Palisoc’s depiction of what it means to rise from provincial comforts to city-centric acclaim and scrutiny that make this film a worthwhile experience.

The aspects of the story tackling that friction make it more exciting than the typical biopic-style formula (which this film has). One scene showing the kids’ first ride through Manila in the form of frenetically edited archival footage and reels from the 1980s is particularly memorable. Certain character dynamics exploring this are just very briefly touched upon, though.

LCC’s steadfast founder and schoolteacher Alma Taldo (played by Ms. Amon in her first major role coming from an illustrious career as a singer) is portrayed with quiet passion. However, her arc of learning to stand strong amid internationally trained choirmasters and success-minded city dwellers requires more grit and nuance than Ms. Amon is able to give. Her singing is a definite strength, with one song where she comforts a student by the poolside being the capstone of her performance.

LCC’s primary patron and generous Boholano governor’s wife Equit Butalid (played by Ms. Alejandro with class and grace) has an intriguing depiction. As a gracious benefactor of the choir, her role is significant but has a sinister undertone of pride and greed as she pushes Alma and the children to win no matter what and she seemingly takes credit for what is mainly their hard work.

But the film inconsistently makes it a big deal in some parts, then glosses over it all in others, making the touches of this complex relationship between Alma and Equit incongruent with the rest of the story’s formula. It would have been a very different film if this was properly explored.

All that aside, Ms. Amon and Ms. Alejandro have a wonderful duet on the piano that may be the most outstanding musical number of the film, aside from the choral pieces.

Ms. Brimner and Mr. Comia, as the teenage choir members we follow the most (being the ones who strike up a potential romance, of course), deliver endearing performances. The former has such a beautiful voice, evidence of her years as a theater actress. The latter’s character arc — an insecure provincial boy seeking out his father in Manila that supposedly abandoned him — is a touching thread in the story that may seem out of place, but which ties together with the rest of the film’s ode to underdogs.

Notably, the other children in the choir are played by actual members of today’s iteration of LCC, injecting natural charm into the film. While it would have been fun to see a straight-up origin story, beginning from the very first attempt to form the group, picking up at the choir’s reformation and second attempt to win the finals was a choice that was best for the kind of story the filmmakers wanted to tell.

The film’s producers from Culturtain said at an advance screening that premiering the film at the Manila International Film Festival (MIFF) in the USA, and not in the Philippines, will likely work in its favor, with many Fil-Ams eager to watch a musical movie about overcoming adversity and rising up in a vibrant, unfamiliar land. With the current wildfires in California having caused the festival to be postponed to a later date, it is probably very fitting for residents of the area to see a film that offers hope.

The journey of the choir from rural comforts to dominating the National Finals of the National Music Competitions for Young Artists (NAMCYA) in the 1980s is an inspiring one that deserves to be put on screen, and Song of the Fireflies is easily a necessary watch for those who can relate to that journey.

2GO appoints CFO Howell as chief operations officer

January 21, 2025 | 12:03 am

2GO-William Charles Howell — WILLIAM CHARLES HOWELL

SHIPPING and logistics solutions provider 2GO Group, Inc. has appointed William Charles Howell as the company’s chief operations officer, taking up a dual role in the company.

In a media release on Monday, 2GO said the appointment of Mr. Howell, who serves as the company’s chief financial officer (CFO), “aims to streamline operations, enhance strategic decision-making, and foster a more integrated approach to financial and operational management.”

Mr. Howell said the company will focus on enhancing its service deliveries to position 2GO as the top logistics company in the country.

Earlier this month, the company announced plans to enhance routes and expand key services.

The company said it aims to continue its growth trajectory this year, citing several initiatives in 2024, such as the addition of three large roll-on/roll-off passenger vessels to service both freight and travel growth in Visayas and Mindanao.

“Will’s leadership has been a guiding spirit in strengthening 2GO’s financial and operational foundation. I am excited to see how he will continue to drive the company’s ambition and purpose in his new capacity,” said 2GO President and Chief Executive Officer Frederic C. DyBuncio.

2GO offers multimodal transportation, warehousing and inventory management, distribution, special containers, project logistics, and e-commerce logistics. It also provides sea travel, freight forwarding, import and export processing, and customs brokerage services. — Ashley Erika O. Jose

RCBC set to offer sustainability notes

January 21, 2025 | 12:03 am

RIZAL COMMERCIAL Banking Corp. (RCBC) is looking to return to the offshore debt market with an offering of benchmark-sized dollar-denominated sustainability notes.

The senior unsecured notes will be issued out of RCBC’s $4-billion medium-term note (MTN) program and under its Sustainable Finance Framework, the Yuchengco-led bank said in a disclosure to the stock exchange.

The bank has prepared an offering circular dated Dec. 20 filed with the Singapore Exchange Securities Trading Ltd., it added.

“In relation to the marketing of the proposed drawdown, fixed-income investors call(s) are scheduled for Jan. 20, 2025,” RCBC said.

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

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

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

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

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

RCBC’s shares dropped by 15 centavos or 0.62% to end at P24.05 apiece on Monday. — A.M.C. Sy

The Shrink Government trend abroad, opportunities for the Philippines

January 21, 2025 | 12:02 am

Yesterday, Donald J. Trump started his second term as the 47^th President of the USA. I have read a number of articles peddling the narrative that the US and global economy, including the Philippines, was worse off during Trump’s first term. To verify if this was true or not, I constructed this table comparing the average growth and inflation rate performance of three presidential administrations — Barak Obama’s last three years (2014-2016), Trump’s first three years (2017-2019), the COVID lockdown years (2020-2021), and Joe Biden’s last three years (2022-2024).

ECONOMIC PERFORMANCE UNDER 3 PRESIDENTS
In terms of GDP growth, the US economy performed better under Trump than under Obama or Biden. The same for its northern neighbor Canada. The two largest economies in Europe — Germany and the UK — have shown consistent declines in average growth over those three administrations.

The three largest economies of Asia except India, China, and Korea have similar trends as the two European countries but at higher levels. Some ASEAN countries — the Philippines, Vietnam, and Thailand — experienced lower growth under Biden than under Trump.

When considering consumer prices, the US, Canada, Germany, and UK experienced inflations levels that were two to three times higher under Biden than under Trump. A similar trend can be seen for Korea and Japan, the Philippines, and Thailand (see Table 1).

So, the idea that the US and global economy including the Philippines was worse off during Trump’s first term is wrong when comparing GDP performance during the Obama and Biden administrations. But the idea is partially true when compared with the Obama administration on inflation.

‘SHRINK GOVERNMENT’ TREND: ARGENTINA, US, VIETNAM
When Argentina’s President Javier Milei took office in December 2023, he immediately reduced the number of government ministries from 19 to nine, merging and partially abolishing 10 ministries. A few months later, he further reduced it to only eight ministries. Argentina experienced a budget surplus within two months.

When Trump won the US elections last November, he announced the creation of a Department of Government Efficiency (DOGE) to be jointly led by Elon Musk and Vivek Ramaswamy*, two successful entrepreneurs. Musk, Ramaswamy, and Trump were all inspired by Milei’s huge fiscal reforms and DOGE was created with a clear mandate of reducing the bureaucracies, subsidies, regulations, and taxes that curtail business. DOGE will self-evaporate by July 2026 or just after an existence of 1.5 years, as it is not meant to be a forever bureaucracy.

Now some leaders of US states are thinking of creating their own DOGE, like the governors or legislative speakers of Iowa, New Hampshire, Louisiana, and Wisconsin, with the same goal of shrinking the bureaucracies, subsidies, and regulations.

Meanwhile, the Vietnam Communist Party announced last December that they will cut the number of government bodies from 30 to 21, in a process they labeled as “institutional revolution.” Among the plans is merging the Ministries of Finance, Planning, and Investment to form a new “super ministry” called the Ministry of Finance and National Planning. Then merging the Ministries of Transport and Construction, and Ministries of Labor, Invalids and Social Affairs with Home Affairs.

The Philippines has a National Government Rightsizing Program (NGRP) bill in Congress which aims to merge some agencies and bureaus and have a leaner national bureaucracy. Local government bureaucracies are not covered by the bill. The Department of Budget and Management is pushing this bill and its Secretary Amenah F. Pangandaman is confident that this move will help reduce the annual deficit and borrowings.

SHRINKING TAXES
President Milei announced last December that they will abolish 90% of all federal or national taxes (not revenues) and have at most only six different taxes on businesses and individuals.

US President Trump plans to further cut US corporate income taxes to 15% hopefully this year, to be implemented in 2026.

The are no similar plans to cut taxes in the Philippines but Finance Secretary Ralph G. Recto has maintained that there will be no tax hikes, and pushed only old tax measures, like a tax on digital transactions to level the playing field with physical transactions.

Recently a bill on a moratorium on sustained increases in the tobacco tax was filed in Congress. I was invited by the House Committee on Ways and Means, chaired by Joey Salceda, and the Senate Committee on Ways and Means chaired by Win Gatchalian. I have attended meetings at both the House and Senate.

The Food and Nutrition Research Institute (FNRI), an agency under the Department of Science and Technology, showed one result of their 2023 survey covering some 36,000 households, or about 150,000 individuals, nationwide. Smoking incidence among respondents who were 20 years old and above increased from 18.5% of adults in 2021 to 23.2% in 2023, a big jump of 4.7%, equivalent to 3.45 million more smokers.

The continued rise in the tobacco tax is supposed to achieve two outcomes: reduce the number of smokers and increase the value of tax revenues. From 2021 to 2023 neither happened. The reverse happened — there were more smokers, and there was a decline in tobacco tax revenues (see Table 2).

The main explanation for this is that many smokers of legal tobacco did not stop smoking or reduce their consumption but instead shifted to illegal tobacco which is dirt cheap. So, the higher tobacco tax rate benefited only smugglers, criminals, terrorist organizers in cahoots with their protectors in government, while tax collections for healthcare declined.

I argued in both the House and Senate Committee meetings that the optimal tax rate is P50/pack because it was the rate that gave the DoF P176 billion in 2021. So, if we want to collect more tobacco tax revenues, the tax rate should be rolled back to P50, not increased to P63, and certainly not P70 a pack.

*Fox News said yesterday that Ramaswamy is expected to pursue the governorship of Ohio instead of taking up the reins of DOGE.

Bienvenido S. Oplas, Jr. is the president of Bienvenido S. Oplas, Jr. Research Consultancy Services, and Minimal Government Thinkers. He is an international fellow of the Tholos Foundation.

minimalgovernment@gmail.com

British actor Joan Plowright, 95

January 21, 2025 | 12:02 am

LONDON — British actress Joan Plowright, winner of two Golden Globe Awards and a Tony Award, has died aged 95, her family said on Friday.

Plowright made her on-screen debut in 1956’s Moby Dick before gaining wider recognition in the 1960 film adaptation of The Entertainer alongside Laurence Olivier, whom she later married.

During her long stage and screen career, Plowright also received nominations for an Academy Award, an Emmy, and two BAFTA Awards.

Other films in which she starred include Enchanted April, Tea with Mussolini, 101 Dalmatians, and Drowning by Numbers.

She retired from acting in 2014.

Plowright passed away peacefully on Jan. 16 surrounded by her family, according to a family statement reported by the BBC and other British media outlets.

“She enjoyed a long and illustrious career across theater, film and TV over seven decades until blindness made her retire,” the statement said.

“We are so proud of all Joan did and who she was as a loving and deeply inclusive human being.”

In a 2018 BBC documentary, Plowright recalled playing the character Beatie Bryant in the 1959 theater production Roots and the rare thrill in that era of being a female lead.

“Beatie is the center of attention, the center of the story instead of being on the side, the decoration bit, the support,” Plowright said. “The female is absolutely at the center of it and it’s that feeling of elation, exhilaration when you know you’re in charge.” — Reuters

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