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Insurers warned of data risk as firms move to self-service

A cyber security expert said insurance firms adapting to new processes during the pandemic must be aware of the security risks and take steps to minimize the impact of data theft.

Red Rock IT Security Forensic Analysis Director Raymond Nuñez said one of the measures he recommends for insurance firms is to keep active claims in a separate database to mitigate the damage from data theft in a “minimalist” way.

“It should be a minimalist approach always. What kind of information do I need? Make the main database push other information to the separate database, so in case the latter gets breached, there’s no path to the former database,” Mr. Nuñez said in a recent webinar organized by the Philippine Insurers and Reinsurers Association.

Information technology (IT) personnel must also update their databases to narrow the exposure to cyber attack happens.

To further ensure that information is received properly, Mr. Nuñez added that insurers can always confirm transactions through phone messages.

“Once the claim is fulfilled, you can pull it out from the database or you could just text the client about the claim, so there’s a minimal risk of exposure,” Mr. Nuñez said.

Another risk was highlighted on the panel by the Insurance Institute for Asia and the Pacific, Inc. (IIAP), which flagged self-service tools as a potential source of risk as the industry undergoes digital transformation.

“To be competitive, you have to digitally transform. One of the dreams of insurance people is we want our claimants to check the status of a claim by themselves without the need for contacting anybody from the company,” IIAP Executive Director Francisco D. Papa, Jr. said.

He highlighted the value placed by data thieves on stored information with long shelf lives – information that is impossible to change in case of a hack.

“Insurance and health data are sold in underground markets. They have longer shelf lives and technically not replaceable. If your password gets breached, you can replace it. But if your fingerprint data gets breached, it would be difficult to replace it. That’s the idea,” Mr. Nuñez said.

Internet security firm Kaspersky Lab said the Philippines was in fourth place in its 2019 ranking of countries with the highest number of web threats, up from 11th a year earlier.

It detected 28 million Internet-borne attacks against Philippine-based Kaspersky users last year, or 44.40% of the Philippines’ total number of Kaspersky users. — Kathryn Kristina T. Jose

Peso weaker on dollar safe-haven plays after Trump tests positive for COVID-19

The peso weakened Friday as investors sought a safe haven in the dollar after US President Donald J. Trump tested positive for coronavirus disease 2019 (COVID).

The peso closed at P48.48 against the dollar, compared with its P48.43 finish Thursday.

The peso opened the session at P48.42, its intraday high. The low was P48.50.

Dollar volume rose to $814.9 million from $807.6 million the previous day.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a text message that the peso weskened on safe-haven moves into the dollar after Mr. Trump tested positive for the coronavirus.

“The peso was weaker after US President Trump tested positive for COVID-19, weighing on sentiment on the global financial markets, including the peso, and also causing a healthy upward correction in the dollar as a safe haven," Mr. Ricafort said.

Bloomberg reported that the test result follows a positive test for White House senior adviser Hope Hicks.

US stock markets fell following Mr. Trump’s test result. The Dow Jones Industrial Average dropped 1.56% while the S&P 500 fell 1.54%. The Nasdaq Composite was down 1.78%.

A trader who asked not to be identified said in an e-mail that investors were also worried about the absence of a resolution on a further round of US stimulus spending.

Mr. Ricafort expects the peso to trade between P48.45 and P48.60 Monday, while the trader puts the range at P48.40 to P48.55. — Kathryn Kristina T. Jose

Network for social housing projects goes digital

The FairBuilding Network, an online platform that brings together buyers and sellers in the bottom-of-the-pyramid (BoP) construction market, recently launched a new website where social housing developers and non-profit organizations with building projects can connect with product suppliers, contractors, architects, and engineers who are willing to help. 

The network is also joining Archify, a platform supporting the needs of product suppliers, design professionals, and end users in the construction industry, this month. Archify users can research, compare, and share design ideas with industry professionals on its website. Features such as mood boards and a library tool that saves one’s preferred products and suppliers in a collection likewise enable users to compose concepts for projects and clients.

“Even before the pandemic, digital innovation has already been the way to go,” said Ayn Rand Parel, administrative manager of FairBuilding Network, in a webinar on September 30. 

FINDING NEW MARKETS ONLINE 

A September 2018 B2B commerce report by Magento said that 12% of business-to-business sales take place online. The number has been steadily growing—not least because of factors stated in the report such as 42% of B2B companies reporting higher order values from online shoppers. “If you don’t innovate, you rarely survive,” said Archify product manager Mark Bueta.

The BoP, or the poorest two-thirds of the economic human pyramid, is a huge yet unserved segment in construction. “There is an assumption that those who need houses need new houses. The solution for developers then is to build subdivisions, but the reality is that a lot who need houses are incremental builders,” said Jessan Catre, Philippine Shelter Venture Lab country lead of Habitat for Humanity’s Terwilliger Center for Innovation in Shelter. Incremental builders improve their living spaces step-by-step as resources become available. 

There is a housing backlog in the low-cost and socialized segments, even as a surplus of housing in the mid-cost to high-end ones exist. Mr. Catre shared that the unserved segment has a US$13 billion market value—untapped potential for investors in the industry.

Matthias Krups, chief executive officer and founder of the BCI Media Group (mother company of FairBuilding Network, which serves as the group’s corporate social responsibility arm), said that the organization is morphing toward a much faster turnaround between homebuilders expressing a construction need and having it served. Noting the pervasive availability of smartphones as well as the usefulness of business models like ride-sharing, Mr. Krups hopes of this goal coming into fruition. “We do see an opportunity to scale things up faster.” — Patricia B. Mirasol

SCG and Mariwasa donate Mobile Isolation Rooms to 2 hospitals

As part of its commitment to give back to the community, Mariwasa Siam Ceramics, Inc., the leading tile manufacturing company in the Philippines, donated two (2) units of Negative Pressure Mobile Isolation Rooms to the Veterans Medical Memorial Center on September 25, 2020 and another one (1) unit to the Lung Center of the Philippines on September 30, 2020.  

The SCG Mobile Isolation Rooms, which use a controlled air pressure system that can protect medical professionals from the risk of contracting the coronavirus disease, were turned over last Friday by H.E. Vasin Ruangprateepsaeng, Ambassador of Royal Thai Embassy, and Ms. Emilie Maramag, SCG Philippines Asst. Country Director, to VMMC Medical Director Dr. Dominador M. Chiong, Jr., in simple ceremonies also attended by Secretary of National Defense, Mr. Delfin Negrillo Lorenzana.

Thai Ambassador Ruangprateepsaeng and Ms. Maramag also led the donation drive at the Lung Center of the Philippines on Wednesday, with Dr. Sullian Sy Naval, LCP Deputy Executive Director for Medical Services and Dr. Antonio Ramos, LCP Administrative Services Department Manager, receiving another unit of the Mobile Isolation Room. 

Continuing efforts

The donation to the LCP was Mariwasa’s second to the hospital, with the first one turned over last June as part of the company’s continuing efforts to help in the fight against the dreaded coronavirus. In the same month, Mariwasa also donated one (1) unit each of Negative Pressure Mobile Isolation Room to the Sta. Ana Hospital and Dr. Fabella Memorial Hospital, both in Manila.

On August 10, Mariwasa turned over a Positive Pressure Mobile Isolation Room to the City Government of Sto. Tomas in Batangas, represented by City Mayor Edna Sanchez and City Administrator Salvador Geling.

Shown here during the SCG-Mariwasa donation of Mobile Isolation Rooms to the Lung Center of the Philippines are (from left) H.E. Vasin Ruangprateepsaeng, Ambassador of Royal Thai Embassy; Ms. Emilie Maramag, SCG Philippines Asst. Country Director; Dr. Sullian Sy Naval, LCP Deputy Executive Director for Medical Services; and Dr. Antonio Ramos, LCP Administrative Services Department Manager.

Humble contribution

“The pandemic has brought the world to its knees, but humanity will eventually prevail, thanks to the joint efforts of everyone. This donation is SCG and Mariwasa’s humble contribution to that cause,” said Mr. Jakkrit Suwansilp, SCG Philippines Country Director and Mariwasa President.

The Mobile Isolation Rooms are expected to serve as a decontamination area to ease the spread of COVID-19 virus in hospital facilities and are suitable for use in emergency rooms (COVID ICUs or PUI wards).

Catering to medical needs similar to permanent structures, the innovative equipment from Thailand can be installed quickly, equipped with a filter system that can effectively prevent the spread of viruses.

“I know that Thailand is not as badly stricken by the COVID-19 pandemic as we are and the gesture of donating the two negative pressure isolations rooms is really a classic example of that phrase “no one left behind.” Thank you so much on behalf of the Lung Center [of the Philippines] to the Thailand Government and Mariwasa Siam Ceramics, Inc.” said Dr. Naval.

Coronavirus pandemic

Coronavirus disease 2019 (COVID-19) is caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), first identified in December 2019 in Wuhan, Hubei, China, and has resulted in an ongoing pandemic. As of this writing, more than 32 million cases have been reported across 188 countries and territories with more than 986,000 deaths. Mariwasa’s parent company SCG (Siam Cement Group) is the largest and oldest cement and building material company in Southeast Asia and Thailand, which has managed to contain the spread of the disease effectively.

Shown here during the SCG-Mariwasa donation of Mobile Isolation Rooms to the Lung Center of the Philippines are (from left) Mr. Evans Frivaldo, Mariwasa Engineering Department Senior Manager; Ms. Emilie Maramag, SCG Philippines Asst. Country Director; Dr. Antonio Ramos, LCP Administrative Services Department Manager; Mr. Danilo Bagay, Mariwasa AVP for Energy & Engineering, Technical, and Operations Division; and Ms. Evelyn Torio, Mariwasa Admin Senior Manager.

Trump says on Twitter he, Melania tested positive for COVID-19

US President Donald J. Trump and First Lady Melania Trump tested positive for COVID-19, he said in a tweet early on Friday.

“We will begin our quarantine and recovery process immediately,” he said. — Reuters

‘Creativity is no different from any sport’ says designer Cobonpue

Discipline is needed in order to remain creative while running a business, according to industrial designer and entrepreneur Kenneth Cobonpue. 

“Creativity is no different from any sport … You have to keep on doing it and devoting certain time for it. I fix a few hours of trying to come up with something every day,” he said during a webinar on business resilience in the time of COVID-19.  

This practice became tougher when lockdowns were implemented, not only for himself but also for his employees. With the mental adjustment of working from home and fewer sources of inspiration to work with, Mr. Cobonpue saw their productivity decrease. 

To address this dip, he implemented a start-of-day (SOD) and end-of-day (EOD) monitoring system where his employees had to give updates on their health and wellness, family issues, location, work tasks, and work concerns. They were able to discipline themselves better through this system, resulting in an almost threefold increase in productivity despite the lockdowns. 

Maintaining a measure of mobility within the home also helped boost creativity. “When you’re bored in one space, you move—trying to find inspiration or a different perspective on life depending where you look,” said Mr. Cobonpue. 

Since taking photos of the furniture in their showrooms was no longer an option, they rendered them digitally. They also shifted to making smaller pieces such as clutches and jewelry holders, understanding the challenges of producing and moving big pieces of furniture (as well as the cost).

BURNOUT

Mr. Cobonpue is aware that the drive to perform amid the pandemic could lead to fatigue. Eagle Hill Consulting, a management consulting firm, recently reported that 58% of the workforce in the United States were feeling burnt out. Forty-seven percent attributed it to their workload, 39% to balancing work and personal life, and 28% to performance expectations.

When such feelings arise, it’s important for employees to find something that makes them happy and can keep their mind off work, even for a while. It doesn’t have to be something grand. Mr. Cobonpue’s fellow panelists in “Business resilience in the time of COVID-19,” a webinar organized by insurance company Manulife China Bank, shared their coping mechanisms. Richard Yap, actor and owner of restaurant chain Wangfu, said that he prays and works out. Victoria Hilado, an estate preparation, planning, and settlement lawyer, said that she watches murder and mystery movies.  

 “If you’re not happy, you can’t be creative. You can’t be inspired,” said Mr. Cobonpue. — Mariel Alison L. Aguinaldo

Manufacturing purchasing managers’ index of select ASEAN economies, Sept. (2020)

PHILIPPINE factory activity expanded for the first time in seven months in September as a looser lockdown helped prop up consumer spending, according to a survey by IHS Markit. Read the full story.

Manufacturing purchasing managers’ index of select ASEAN economies, Sept. (2020)

PHL factory activity expands in Sept.

By Beatrice M. Laforga, Reporter

PHILIPPINE factory activity expanded for the first time in seven months in September as a looser lockdown helped prop up consumer spending, according to a survey by IHS Markit.

In a statement on Thursday, IHS Markit reported the country’s Manufacturing Purchasing Managers’ Index (PMI) improved to 50.2 last month from 47.3 in August. This was the first time since February that it breached the 50-neutral mark that separates expansion from contraction.

“The latest reading was the highest since February and signalled that operating conditions were broadly stable across the goods producing sector,” IHS Markit said.

Manufacturing purchasing managers’ index of select ASEAN economies, Sept. (2020)

Most parts of the Philippines were under the strictest form of lockdown from mid-March to May, halting nearly all economic activity. Restrictions have been eased to allow many businesses to resume operations, although health and safety protocols remain as the number of coronavirus infections still rise.

The headline PMI measures manufacturing conditions through the weighted average of five indices: new orders (30%), output (25%), employment (20%), suppliers’ delivery times (15%) and stocks of purchases (10%).

The Philippines and Vietnam were the only two Association of Southeast Asian Nations (ASEAN) member-economies that saw PMI growth last month. Vietnam’s PMI rose to 52.2, the highest in the region.

Manufacturing activity worsened for most of the region, bringing the regional average to 48.3 in September from 49 in the previous month.

For Philippine manufacturing firms, IHS Markit said overall new orders climbed for the first time in seven months but only slightly amid the further reopening of the economy and stronger demand from customers.

Export sales also improved in September after six months of consecutive contraction, after clients were reportedly stocking up in anticipation of better market conditions in the coming months.

However, factory output declined for the third straight month albeit at the slowest pace in September.

“According to firms, the ongoing restrictions related to the COVID-19 pandemic continued to limit the performance of the sector, with some businesses forced to pare back operations,” Shreeya Patel, economist at IHS Markit was quoted as saying.

Workforce numbers remained on a downtrend for the seventh straight month. This was attributed to voluntary resignation of employees and cost-cutting measures implemented by the companies.

“Another reduction in backlogs of work highlighted evidence that spare capacity persisted across the manufacturing sector,” IHS Markit said.

Manufacturing firms also saw a temporary rise in inventory last month, with stocks of raw materials and finished goods seeing a slight uptick for the first time in seven months.

However, more expensive transportation costs, material shortages and reported supplier surcharges related to the pandemic have resulted in a heavier cost burden for the respondents.

“Manufacturers had some difficulty passing on higher costs to clients due to tough market competition, however, with factory gate charges rising only marginally,” it said.

Overall, good producers were still optimistic of the output volumes in the next 12 months, while business expectations surged to its highest level since February as firms hope demand will bounce back to pre-pandemic levels.

“Stronger business sentiment and efforts to rebuild stocks suggest panellists are preparing for an improvement in demand over the coming months, although optimism continues to rest on the development of the pandemic,” Ms. Patel said.

Respondents with subdued expectations cited the ongoing income losses and uncertainties amid the coronavirus pandemic.

“The bounce in PMI manufacturing was a welcome development as it does point to some gradual recovery after the index previously declined in August. The sharp bounce, however, was traced more to higher price indices given still tight supply chains with firms unable to completely pass on increase to the consumer given poor demand conditions,” ING Bank N.V. Manila Branch Senior Economist Nicholas Antonio T. Mapa said in an e-mail.

University of Asia and the Pacific School of Economics Senior Economist Cid L. Terosa said the pickup in PMI signals that manufacturers are positioning themselves for the possible revival of economic activities.

Mr. Terosa expects the index to hover above the 50-neutral mark in the coming months amid looser lockdowns and the nearing holiday season.

“The downside risks to this would be a resurgence in the number of COVID-19 cases that would again stunt market activity and render unprofitable spiked up production. Also, greater demand for raw materials or production inputs can raise production costs and consequently prices. This should be expected, however, with greater production activity after a long lull,” he said in an e-mail.

However, Mr. Mapa said the low production volumes still reflect the dampened economic conditions. He said sustaining the rebound in new orders will depend on how the coronavirus outbreak will be contained.

“Overall, we note some green shoots of hope for a recovery but we reserve our cheers for a turnaround until we can see a sustained pace of gains that would signal that the economy is fully on the mend,” he added.

Central bank keeps key rate at record low

THE Bangko Sentral ng Pilipinas (BSP) on Thursday left its key interest rate unchanged for a second straight meeting, citing easing inflation and ample liquidity in the financial system.

At its fifth policy meeting this year, the Monetary Board (MB) kept the rates on the BSP’s overnight reverse repurchase, lending and deposit facilities unchanged at their record lows of 2.25%, 2.75% and 1.75%, respectively.

“The Monetary Board’s decision is based on the assessment that the prevailing monetary policy settings remain appropriate,” BSP Governor Benjamin E. Diokno said in an online briefing.

While inflation is expected to tread a slightly lower path, Mr. Diokno said it is still projected to remain within the government’s 2-4% target band.

He said the MB also considered the “encouraging signs” of a recovery in the domestic economy, supported by sufficient liquidity. The global economy also appears to have stabilized, although uncertainty remains as coronavirus disease 2019 (COVID-19) infections are still on the rise in some parts.

“Given these considerations, the Monetary Board is of the view that a continued pause will allow prior measures by the BSP to further work their way through the economy. The gradual easing of restrictions, along with sustained efforts by the government to protect human health and livelihood, should also help lift market sentiment and aid the recovery of the economy in succeeding months,” Mr. Diokno said.

A BusinessWorld poll last week showed 14 of 15 analysts expected the central bank to keep interest rates untouched to allow more time for previous measures to work their way into the economy.

“Looking ahead, the BSP stands ready to deploy its full arsenal of instruments as needed in fulfillment of its mandate to maintain price and financial stability conducive to sustainable economic growth,” Mr. Diokno said.

SLOWER INFLATION AHEAD
In the same briefing, BSP Deputy Governor Francisco G. Dakila, Jr. said the inflation forecast for this year was revised downwards to 2.3% from the previous 2.6% estimate due to easing oil prices and lower-than-expected print for August.

The central bank on Wednesday estimated headline inflation to have settled between 1.8% and 2.6% in September. The Philippine Statistics Authority (PSA) is set to report September inflation data on Oct. 6.

Mr. Dakila said they also lowered the inflation outlook for 2021 and 2022 to 2.8% (from 3%) and 3.0% (from 3.1%).

“However, we continue to retain the balance of risks on the downside over the policy horizon from 2020 up to 2022. This owes largely due to the risks of potential disruptions to domestic and global economic activity amid the ongoing pandemic,” Mr. Dakila said.

Meanwhile, Mr. Dakila said the BSP still has enough room to further its reserve requirement ratio (RRR).

“Further reductions in our ratios can be considered by the monetary policy as needed, at this point, that benign inflation environment provides us room for further reductions in reserve requirements if necessary, even as recent indications of financial market activity continue to point to the fact that market liquidity has remained adequate,” he said.

The BSP in April cut big banks’ RRR by 200 basis points (bps) to 12%, while the reserve requirements for thrift and rural lenders were trimmed by 100 bps to three percent and two percent, respectively. The MB has authorized RRR cuts of up to 400 bps this year.

Security Bank Corp. Chief Economist Robert Dan J. Roces said the MB may have considered the prevailing uncertainty over the pandemic in its decision to keep its rates unchanged.

“The central bank clearly is factoring in the still uncertain environment, preserving some conventional ammunition until the third-quarter growth figures are out as it continues to evaluate the transmission of its prior policy actions relative to forthcoming fiscal measures to address the pandemic. This plus good liquidity in the financial system justifies the hold,” Mr. Roces said via Viber.

In a note, Capital Economics economist Alex Holmes said the central bank has not finished its easing cycle for the year since the economy’s recovery seems to be one of the slowest in the region.

“We think more easing is necessary. Gross domestic product (GDP) contracted by 16.5% y/y in the second quarter. While activity is now recovering, the country’s failure to contain the virus is holding back the recovery,” Mr. Holmes said.

For ING Bank N.V. Manila Branch Senior Economist Nicholas Antonio T. Mapa, the MB is unlikely to cut benchmark interest rates in its last two meetings this year since the real policy rate is now in negative territory. — Beatrice M. Laforga

PHL slips in digital competitiveness

BUSINESS LEADERS are calling for improvements in information technology infrastructure and workforce talent development after the Philippine ranking for digital competitiveness dropped two spots in a global digital competitiveness index. Read the full story.

PHL slips in digital competitiveness

Improvements needed to boost PHL’s digital competitiveness

The Philippines placed 57th out of 63 economies in IMD business school’s World Digital Competitiveness Ranking. — REUTERS/REGIS DUVIGNAU

By Jenina P. Ibañez, Reporter

BUSINESS LEADERS are calling for improvements in information technology infrastructure and workforce talent development after the Philippine ranking for digital competitiveness dropped two spots in a global digital competitiveness index.

The Philippines placed 57th out of 63 economies in IMD business school’s World Digital Competitiveness Ranking. The country also dropped one spot to 13th place out of 14 Asia-Pacific economies after being overtaken by Indonesia.

In 2019, the Philippines edged up one spot to 55th overall, after a 10-place drop a year earlier.

Each economy is ranked in indicators grouped under three pillars. Under the knowledge pillar, the Philippines plummeted to 62nd after ranking 51st last year. Its ranking in the technology pillar improved to 53rd from 55th, while its place in the future readiness pillar stayed at 54th.

IMD Senior Economist José Caballero in an e-mail on Wednesday said the slip in the Philippines’ ranking reflects a weakening of the talent, training, and education sub-factors under the knowledge pillar.

“The deterioration of these sub-factors is mainly driven by decreases in the availability of internationally experienced senior managers, attracting foreign highly skilled personnel and employee training,” he said.

“Other countries in the Southeast Asian region perform, to different degrees, stronger in that (knowledge) factor.”

European Chamber of Commerce of the Philippines (ECCP) President Nabil Francis said the Philippines’ young and highly literate workforce attracts foreign investors looking for a competitive workforce.

“The ECCP supports measures that will promote reinforcement of skills and capability development, enact an apprenticeship reform bill, and incentivize enterprises which invest in competitive training and upskilling programs to ensure that the dividends of this demographic sweet spot are realized,” he said in a mobile message.

He also called for new laws to allow for “investments in digital technologies necessary for the online delivery of reskilling, upskilling, and training programs at a time when the current coronavirus pandemic limits physical and face-to-face interactions.”

American Chamber of Commerce of the Philippines Senior Advisor John Forbes said the proposed Digital Workforce Competitiveness Act, which would train workers with digital skills, should be passed. It is still pending at the Senate.

“It is quite important to pass this before the end of the year and prioritize its implementation to develop a large, adequately skilled workforce to support the fast-growing digital economy,” he said.

The Philippines performed its best in high tech exports, where it ranked 2nd, as well as female researchers (5th), investment in telecommunications (10th), graduates in sciences (12th), high-tech parent grants (16th), and attitude towards globalization (17th).

The Philippines performed its worst in starting a business and communications technology, ranking 62nd in both. It placed 61st in enforcing contracts and 59th in educational assessment.

The country should also improve its information technology infrastructure and develop affordable connectivity, Legislative-Executive Development Advisory Council (LEDAC) private sector representative George T. Barcelon said in a phone interview.

“It’s really slow, the availability and the speed of the broadband. Certain pockets in Metro Manila are okay, but going outside NCR, it’s really a challenge,” he said.

“As far as Filipino skill, many high-level IT experts abroad are Filipinos. They’re being poached all over… so the rating, of course, is within the shore of our archipelago. That’s the limitation,” he added.

The top 10 on the global list included the United States, Singapore, Denmark, Sweden, Hong Kong, Switzerland, the Netherlands, South Korea, Norway, and Finland.

PHL slips in digital competitiveness

Monetary Board approves P540 billion advance to NG

THE central bank on Thursday approved a P540-billion cash advance to the National Government (NG) to boost its war chest against the pandemic.

“The Monetary Board (MB) approved today the National Government’s request for a new tranche of provisional advances in the amount of P540 billion (approximately $11.1 billion), pursuant to Section 89 of Republic Act (RA) No. 7653, as amended,” Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno told reporters via Viber.

He was referring to the Bayanihan to Recover as One Act, which authorized the increase of BSP’s lending limit to the government to 30% of its average revenue from the previous 20%.

This is the second loan to be granted by the BSP to the National Government this year, bringing the direct provisional advances so far to P840 billion, or P10 billion less of the P850-billion limit.

The Bureau of the Treasury on Tuesday repaid the P300 billion it borrowed from the BSP through a repurchase agreement of government securities.

“The second tranche of cash advances will have marginal impact on inflation and the currency but successive rounds of such agreements may eventually call into question central bank independence,” ING Bank N.V. Manila Branch Senior Economist Nicholas Antonio T. Mapa said in a note on Thursday.

The government’s budget deficit ballooned to P740.7 billion in the eight months to August, up 515% from P120.4 billion a year ago, on the back of increased spending for its pandemic response and reduced tax collections.

The government has so far raised P2.47 trillion from local and foreign sources. It plans to borrow P3 trillion this year to plug funding shortfall seen to reach 9.6% of the nominal gross domestic product. — Beatrice M. Laforga

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