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Pag-IBIG sees loan levels returning to normal in Sept.

The Home Development Mutual Fund (Pag-IBIG) said it expects loan approvals of as much as P6 billion in September after a shortfall during the two-week return to a stricter form of quarantine in August.

“We are confident na babalik na s’ya level na tipong P5-6 billion, if not P7 billion (We are confident that it will return to the level of around P5-6 billion, if not P7 billion),” Pag- IBIG Chief Executive Officer Acmad Rizaldy P. Moti said at an online briefing Friday. He described the push to issue loans as an aid to economic recovery in the next two years.

Mr. Moti said loans granted in January and February averaged P6 billion, but fell to P3 billion in March after the declaration of the lockdown. The low point was P800 million in April.

“Tumaas ito nung June, umakyat sa almost P3 billion. Nung July umakyat to almost P5 billion,” he said. (It increased in June, up to P3 billion. In July, it rose to almost P5 billion)

“Pabalik na sana tayo kaso nitong August ay nagkaron ng two weeks na MECQ (Modified Enhanced Community Quarantine) kaya bumaba ulit.” (We expected a recovery, but we were in MECQ for two weeks in August so it went back down.) The Luzon lockdown started in March and led to the suspension of work, classes and public transportation.

Restrictions in Metro Manila were gradually lifted in June, but were re-imposed for two weeks in August to arrest the increase in the number of cases.

Mr. Moti said Pag-IBIG implemented a three-month loan moratorium after the quarantine started, which was availed of by some 300,000 members.

A 60-day grace period on loan payments will be implemented, once President Rodrigo R. Duterte signs the proposed Bayanihan to Recover as One (Bayanihan II) legislation.

“Sa madaling salita, okay pa ang mga myembro, may mga dumudulas, na hindi nakakabayad religiously, pero ang Pag-IBIG ay naghahanap ng pamamaraan para matulungan.” (In other words, our members are all right, some are slipping in their payments, but Pag-IBIG is looking at ways it can help)

Bayanihan II forms part of the government’s stimulus plan to recover from the crisis brought by the pandemic. It will grant up to P165 billion assistance to various hard-hit sectors. — Charmaine A. Tadalan

M3 growth slows in July to 14.5%

Money supply growth decelerated in July as the slowdown in economic activity continued following the easing of coronavirus disease 2019 (COVID-19) lockdown.

Domestic liquidity or M3, the broadest measure of money supply, rose 14.5% year-on- year, slowing from 14.9% in June, according to the Bangko Sentral ng Pilipinas (BSP) Friday. M3 rose 0.5% month-on-month.

The July M3 reading ended a streak of increased rates of expansion dating to March.

Demand for credit continued to prop up the money supply, the BSP said.

Growth in domestic claims increased 12.3% from 13.3% in the prior month.

Net borrowing by the central government expanded 51.7% in July, against 53.2% in the previous month. The central bank said this partly reflected the government’s higher funding requirements during the COVID-19 pandemic.

Meanwhile, growth in claims on the private sector, driven mainly by lending to non- financial corporations and households, also slowed to 6.1% in July from 7.2% in June with business operations were hampered by quarantine measures.

On the other hand, net foreign assets (NFA) rose 23% in July, against 15.7% growth in June.

“The continued expansion in the NFA reflected the increase in gross international reserves. Meanwhile, the growth in the NFA of banks accelerated as banks’ foreign assets rose on account of higher deposits with other banks, as well as interbank loans,” the BSP said.

ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa said the central bank’s accommodating lending policy was insufficient in encouraging spending from consumers and businesses.

“Domestic liquidity showed double-digit growth but judging from the deceleration in loan activity, this may be more attributed to the reserve requirement ratio reductions carried out by the BSP.

However, throwing money at the problem will not solve the woes of the public if end-user demand remains largely absent amidst the decrepit labor market while uncertainty over the virus remains in the air,” Mr. Mapa said.

The central bank’s Monetary Board, at its fourth policy meeting for the year, kept the rates on the BSP’s overnight reverse repurchase, lending and deposit facilities at their record lows of 2.25%, 2.75% and 1.75%, respectively.

Bank lending slows further

Bank lending continued to ease for the fourth consecutive month in July, reflecting the deepening impact of the virus on economic activity.

Outstanding loans disbursed by universal and commercial banks and net reverse repurchase (RRP) placements with the BSP grew b6.7% in July, against 9.6% in June.

Loans for production activities also expanded 5.9% in July from 8.2% in the prior month.

The BSP said this was driven by lending to sectors including real estate (11.5%), information and communication (18.4%); financial and insurance (6.3%); electricity, gas, steam, and air conditioning supply (4.4%); human health and social work (46.7%); and transportation and storage (9.7%).

Loans to households grew 17.3% in July from 27% in June as demand for credit card, motor vehicle and salary loans weakened.

The central bank expects growth in bank lending to accelerate as quarantine measures loosen.

“Sustained monetary and fiscal policy support should likewise help shore up market sentiment as the economy gradually reopens” the BSP said.

Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort said aggressive funding from the government reduced reliance on private banks.

“Increased fund-raising activities in the capital markets, especially thorugh bond markets, equity markets, and other securities, by the biggest companies in the country may have also resulted in the much lower demand for loans, as these big businesses have learned to reduce their reliance on traditional bank loans as a source of funding,” Mr. Ricafort said.

He added low interest rates on government securities turned borrowers away from private banks.

However, Mr. Ricafort sees bank lending expanding in the next few months as the government balances pandemic containment with the need to kickstart consumer spending.

“As an offsetting positive factor for loans growth, the government signalled that it would like to keep the economy as open as possible, even if new COVID-19 cases (arise), provided that stringent health protocols are strictly followed to prevent the further spread of the virus,” he said. — Kathryn Kristina T. Jose

Peso weaker on Moody’s GDP forecast downgrade

The peso weakened further Friday after Moody's Investors Service projected a deeper contraction for the economy than initially expected.

The currency closed at P48.62 to the dollar Friday, against its P48.58 close a day earlier, according to data from the Bankers Association of the Philippines.

The peso opened Friday at P48.63, trading between the high of P48.55 and the low of P48.64.

Dollar trading volume fell to $453.5 million Friday from $647.05 million Thursday.

BDO Chief Market Strategist Jonathan L. Ravelas said the peso weakened after Moody’s cut its 2020 forecast.

"The currency (has fallen) 0.28% in 12 weeks,” Mr. Ravelas said in a text message, noting the “Moody's forecast of a deeper contraction this year by 7% from earlier projection of 4.5% drop in GDP.”

Rizal Commercial Banking Corp. (RCBC) Chief Economist Michael L. Ricafort said the dollar strengthened on expectations the US economy will bounce back after speculation about the rollout of vaccines against coronavirus disease 2019 (COVID-19).

The US Centers for Disease Control and Prevention (CDC) has asked state public health officials to prepare to distribute a potential coronavirus vaccine to high-risk groups as soon as late October, Reuters reported.

Drug developers including Moderna Inc., AstraZeneca Plc and Pfizer, Inc. are thought to be making progress in developing a vaccine against COVID-19.

White House Chief of Staff Mark Meadows also said that President Donald J. Trump is "right now willing to sign (a relief aclage of) $1.3 trillion" Reuters reported.

Mr. Ricafort also said US employment is expected to pick up again as other economic indicators improved in August, particularly those dealing with manufacturing.

"The markets are also anticipating the latest jobs data on Friday which are expected to show a continuing recovery," Mr. Ricafort said in a text message.

The Institute for Supply Management (ISM) reported a factory activity index of 56.0 in August from 54.2 in July, the highest reading since November 2018 and a third straight month of growth, Reuters said.

Mr. Ricafort expects the peso to trade between P48.45 and P48.75 on Monday, while Mr. Ravelas sees a range of P48.50-P49.70. — Kathryn Kristina T. Jose

Consumer group alleges MORE Power overcharged for system loss

A consumer group in Iloilo City sought the help of the Energy Regulatory Commission (ERC) to look into alleged system loss overcharges by the city’s power distributor.

Koalisyon Bantay Kuryente (KBK) on Friday filed with the regulator a complaint against Razon- led MORE Electric and Power Corp. (MORE Power) for the supposed 60% increase in system loss charges in the past billing months.

In a virtual briefing, it also alleged the company of breaching the government-mandated cap in system loss, which the ERC pegged at 6.25% for the utility.

MORE Power’s system loss rate in its May bills increased to P0.7612 per kilowatt-hour (kWh) from April’s P0.4719/kWh, it noted based on consumer bills.

According to its computation, multiplying the rate by the city’s monthly average power consumption of 54,000 megawatt-hours, the utility is estimated to have collected around P41 million in said charges.

“From April to May, there is a staggering increase of 60% in the system loss charges collected from consumers of Iloilo. These are indications that MORE has already exceeded the cap being imposed by the ERC,” said Estrella C. Elamparo, the group’s legal counsel, who also advises Panay Electric Co., Inc. (PECO), Iloilo City’s former power distributor.

“The actual increase from one bill to the next is huge. Where did that come from? That is a question that MORE must address and answer,” Marcelo U. Cacho, PECO’s head of public engagement and government affairs said in the same briefing.

Mr. Cacho said the amount represents an estimated overcharging of over P13 million when compared to PECO’s system loss rate at P0.5178/kWh previously.

Adding what MORE Power supposedly collected from system loss recoveries in July – estimated at P7.7 million – it may have over-collected P20.9 million from consumers, he added.

The June rate was out of the computation as bills for the month are yet to be delivered, the consumer group noted.

“(S)hould it be confirmed that they have been charging the hapless Iloilo consumers for systems loss over and above the cap imposed by the commission, MORE should be made to refund the excess charges to the consumers,” KBK said in its complaint.

MORE Power’s franchise may also be investigated should it be proven to have overbilled consumers, Ms. Elamparo said.

Last week, the Energy Regulatory Commission (ERC) confirmed that MORE Power’s system loss charges in June, the amount recovered from consumers from generated power that dissipates during distribution, is at 6%, which is below the maximum cap.

MORE Power recently said in a statement that it would bring down system loss charges over the next three years as it undergoes modernization.

In 2018, the ERC ordered the gradual reduction of system loss charges. By 2021, private electricity distributors will charge up to 5.50% for system loss recovery from a 6.50% cap, while electric cooperatives will recover the cost at an 8% limit in 2022 from 12%.

The commission has based its mandated caps on load density, sales mix, cost of service, delivery voltage, and other technical considerations.

The latest power rate issue comes as Iloilo City is also facing frequent outages and delayed electric utility deliveries. — Adam J. Ang

Filinvest prepares offshore bond offering

Filinvest Development Corp. (FDC) is preparing to put up senior dollar bonds abroad, the proceeds of which will be used to invest in infrastructure projects, it said on Friday.

In a stock exchange disclosure, the Gotianun-led holding firm said it would issue the US dollar- denominated unsecured notes via Filinvest Development Cayman Islands, its special purpose vehicle.

It tapped UBS AG Singapore as the sole global coordinator for the bond sale. The bank is joined by Standard Chartered Bank as lead manager and book-runner.

The company has yet to price the Reg-S only bonds, which will be offered elsewhere outside the US. The notes are expected to be unrated, it said.

Besides using the proceeds from the issuance of the bonds for refinancing its existing debts, it will also be used to funnel investments in digitalization, renewable energy, water, desalination and wastewater, district cooling, and other infrastructure projects.

The company’s board signed off the planned issuance of the bonds in July.

In the second quarter, it reported a 39% growth in attributable income to P4.21 billion, despite recording a 24% decline in revenues to P14.72 billion.

This increased its attributable earnings between January and June by 24% to P7.2 billion. Its property, banking, and sugar businesses helped lift its earnings, while its power segment posted a lower contribution, and its hospitality unit incurred a loss.

Its year-to-date revenues dropped by 16% to P31.89 million, though, it was offset by a 6% cut in total costs and expenses at P30.61 billion.

Shares in FDC inched down 0.59% to close at P8.45 on Friday. — Adam J. Ang

San Miguel seeks stock trading suspension

Ramon S. Ang-led San Miguel Corp. (SMC) sought to suspend the trading of some of its shares on Sept. 9.

On Friday, the listed conglomerate requested the Philippine Stock Exchange to halt the trading of its 89.33 million preferred series 2 shares, subseries D (SMC2D). This will give it time to pay off shareholders for selling their securities back to the company.

“In order for the Company to process the payment of the proceeds from the redemption of the SMC2D Shares to the stockholders of record, the Company requests that the trading of SMC2D Shares be suspended beginning September 9, 2020 which is the ex-date,” it said.

The record date of the redemption of the shares is Sept. 14.

Shares under the said series inched down 0.20% to close at P75.15 each on Friday.

Two weeks ago, the conglomerate filed for the shelf registration of half of its 533.33 million preferred shares, the proceeds of which will be used to add capital into its subsidiaries.

It will be putting up 266.66 million shares, which already include an oversubscription option, at

P75 per share with a par value of P5 each. The securities are cumulative, non-voting, non- participating, nonconvertible, redeemable, peso-denominated, and perpetual.

The shares sale will run from September 29 to October 9. On Friday, shares in SMC rose by 2.83% to close at P101.80 apiece. — Adam J. Ang

PSEi ends higher on ‘positive’ prices, jobs data

Philippine shares ended the trading week in positive territory as investors responded favorably to recent reports on the country’s lower inflation and unemployment rates.

The bellwether Philippine Stock Exchange index (PSEi) rose 12.23 points or 0.21% to 5,785.09 while the broader all-shares index climbed 4.21 points or 0.12% to 3,493.73.

In a mobile phone message, PNB Securities, Inc. President Manuel Antonio G. Lisbona said the market ended in the green as investors focused on favorable labor and inflation statistics.

“Latest unemployment figures are taken as a positive cue for investors to buy the market while the recent inflation rates imply that the national government’s stimulus efforts have not yet caused the prices of commodities to rise,” Mr. Lisbona said.

“The latest inflation rate also keeps the likelihood of the monetary tightening low for the meantime,” he added.

On Thursday, the Philippine Statistics Authority (PSA) reported a 10% unemployment rate for the month of July, which is equivalent to 4.6 million jobless people.

The latest figure is higher compared with 5.4% in the same period last year. It is significantly lower than the record 17.7% in April this year.

PSA chief Claire Dennis S. Mapa said the easing of quarantine restrictions contributed to the current unemployment figures.

Meanwhile, the PSA reported on Friday that the country’s inflation rate eased to 2.4% in August, lower than the previous figure of 2.7% in July.

The PSA said the lower inflation rate was due to the decelerated price increases for the heavily weighted food and non-alcoholic beverages index.

Philstocks Financial, Inc. Research Associate Claire T. Alviar said that aside from the unemployment figures and inflation rates, the local market rose on last-minute bargain hunting.

“Last-minute bargain-hunting lifted the bourse, up by 0.21%. Investors hunted bargains after the PSEi declined near the 5,700 support level,” Ms. Alviar said.

On Friday, most of the market’s sectoral indices declined except for property, which rose 46.25 points or 1.78% to 2,636.27 and holding firms at 35.35 points or 0.59% to 5,998.23.

Mining and oil dropped 170.65 points or 2.76% to 5,992.08; industrials shrank 82.35 points or 1.04% to 7,814.5; services declined 19.48 points or 1.32% to 1,455.41; and financials fell 5.27 points or 0.46% to 1,126.41.

Trading value was at P5.45 billion on Friday with 554.57 million shares changing hands, against Thursday’s P5.27 billion with 961.02 million shares.

Decliners outpaced advancers, 104 versus 77, while 51 names ended unchanged.

Net foreign selling dropped to P770.19 million against P1.12 billion during the previous day.

“We may have to observe next week if the market would hold above the support at the 5,700 area. Nearest resistance may be pegged at the 6,000 level,” Timson Securities, Inc. Head of Online Trading and Trader Darren Blaine T. Pangan said in a mobile phone message.

“We expect the market to move within 5,500 to 5,800 barring any shocks or surprises,” PNB’s Mr. Lisbona said.
— Revin Mikhael D. Ochave

AboitizPower remits P508.2-M direct benefits to LGUs

Aboitiz Power Corporation’s fund remittances to its host communities have reached P508.2 million to date, highlighting the organization’s commitment to supporting its stakeholders and helping the country recover from the impact of COVID-19.

Through the Department of Energy’s (DOE) Energy Regulations 1-94 (ER 1-94) program, AboitizPower and its partners have directly downloaded P148.2 million to 174 host beneficiaries across the country, with around P34 million still awaiting turnover.

Meanwhile, another P359.97 million from various AboitizPower-led generation companies, accumulated as of 2019, has already been remitted by the DOE to the host beneficiaries.

“We are glad that these funds are now with our communities as these will ensure they have the resources to fund crucial projects in their areas. Recent developments have also allowed them to use these remittances specifically to bolster their campaign against COVID-19,” AboitizPower President and CEO Emmanuel V. Rubio said.

The ER 1-94 Program is a policy under the DOE Act of 1992 and the Electric Power Industry Reform Act of 2001 (EPIRA), which stipulates that host communities will get a share of one centavo for every kilowatt-hour (P0.01/kWh) generated by power plants operating in its area.

The fund can be used by host beneficiaries for the electrification of areas or households that have no access to power, development and livelihood programs, as well as reforestation, watershed management, health, and environmental enhancement initiatives.

“Given the severity of the COVID-19 crisis, we at the DOE came up with the necessary circular that would enable host LGUs to use their available ER 1-94 funds to augment their COVID-19 response funding. We are pleased to learn that our vision is being fully realized. Malayo ang nararating ng bawat tulong sa panahon nitong pandemya (Every help goes a long way during this pandemic),” DOE Secretary Alfonso G. Cusi said.

With the new circular covering ER 1-94 funds, host LGUs can now use these shares to help manage the effects of the new virus, in accordance with the Bayanihan to Heal as One Act. This includes the facilitation of mass testing by providing and constructing facilities, as well as acquiring proper medical testing kits.

“More than the fact that this is the obligation of power generation companies to its host communities, this is a manifestation of our commitment to supporting our partners in any way we can, especially during these challenging times,” Rubio added.

AboitizPower subsidiaries Therma South, Inc. (TSI) and Hedcor were the latest to remit to their host communities, with about P26 million already downloaded to Davao City alone. Around P36 million has also been remitted by TSI and DOE to other various local governments in the Davao region.

These financial benefits have funded several projects across AboitizPower’s host communities, including COVID-19 initiatives in some cities and municipalities, which AboitizPower and its partner local government units work closely on to identify and implement.

The LGUs of Navotas in Metro Manila, Maco in Davao de Oro, and Nasipit in Agusan del Norte recently turned over relief goods to over 7,600 households in their respective communities through funds from the AboitizPower Oil Business Unit.

AboitizPower’s solar and geothermal units have also helped LGUs in Albay, Batangas, Laguna, and Negros Occidental build holding areas and distribution centers, provide medical and PPE supplies to frontline workers, decontaminate facilities, and distribute relief goods to feed low-income households during the quarantine period.

What’s next for business today?

The time to restart and build business resilience

During this unprecedented time of change, companies needed to adjust to the new challenges and economic conditions through innovative, digital, and contactless strategies. However, as the economy continues to decline due to limited economic activities, social distancing, and stay-at-home measures, several companies had temporarily closed or filed for bankruptcy, mainly those that rely on foot-traffic, physical contact, and large gatherings. Some leaders may have looked back and hoped they invested early in digital, data-driven, and cloud technologies to be adaptive and have a steadfast and agile business function. Pivoting or shifting from the standard practice to a whole new level of business approaches – going digital and implementing a remote distributed workforce of one’s business operations is alone challenging and requires technical knowledge and expertise for businesses – added to that is the financial constraints.

To arrive at the well-planned decisions and proactive business to navigate in the new normal, leaders or business owners must deem to understand how to redefine or restart their business and embark on the Digital Transformation journey for them to stay afloat and recover.

 

Efforts to sustain business

At this time, probably most businessmen have already been hearing about Digital Transformation and what it can do for business. If there is a time to be responsive and invest in Digital Transformation to strengthen one’s leadership, the time is now. There is no one-size-fits-all solution because a business structure, function, and workforce depend on its industry and maturity. Businesses must take advantage of the unexpected situation to assess opportunities and establish new strategies to mirror the upturned business landscape under the prevailing circumstances—considering the health protocols and compliance with what the government mandates. Restarting or reopening a business will never be the same as the usual work environment in the pre-pandemic period—with safety measures and workplace policies becoming a mandatory commitment. When possible, remote working should be highly encouraged to reduce foot traffic in public and keep the workforce safe in the comfort of their own homes.

Truth be told, the best innovations are created out of specific and urgent needs or problems. Businesses must identify the scope that needs to be strengthened or enhanced, such as budget, operations, workforce, IT infrastructure, supply chain, product or service portfolio, etc. Then, consider planning a change or improvement of business models and approach, leveraging digital capabilities and online channels for services and sales, analyzing the current consumer behavior, or changing or expanding the product portfolio with the integration of enabling technologies.

Significant steps towards Digital Transformation

The key here is to onboard and remobilize the whole workforce as well and get them to be involved in strategic planning, at the same time providing them guaranteed safety and job security. Leaders must nurture their distributed workforce what they would expect from them – guidelines, monitoring, and productivity measurement. By all means, a new workplace environment should also have the right tools and technologies to build a robust and secure workforce environment.

Also, the current consumer behavior has shifted to digital and online activity and presented a high demand for essential goods and services. If possible, alter the brand positioning or product offering that can fulfill current and untapped needs. Then creating a contactless experience as an avenue for sales and supply chain for both employees and customers helps businesses gain a competitive edge in the market.

Crucial short- or long-term business decisions must be made by leaders to survive the following days or months. The survival of businesses requires new business approaches and technology adaptation. Leaders must define a solid plan for reopening that includes current market conditions, scalability, and business resiliency that responds to any unforeseen events – whether it is economic or health crisis.

As technology entrepreneurs perceived it, proactive businesses that gradually adjusted in these prevailing conditions float efficiently in the tidal wave of changes and emerge in a powerful state once the situation subsides.

Jump-starting your Digital Transformation journey

New opportunities and re-structuring the business models today seems like it would be challenging and complex and cost a little or more, but the benefits outweigh the cost and short-lived challenges for a long time. An evolving business is challenging without external help, but government programs, business experts, and technology entrepreneurs are more than willing to support companies thrive in this period.

AMTI, one of the most diversified ICT companies in the Philippines and a Digital Transformation enabler and champion, helps businesses with operational and remote-first challenges through its innovative solutions offerings and consulting services.

Talk to AMTI now to help you analyze your current IT Infrastructure and remote-first work readiness to come up with recommendations and solutions tailored for your business.You may email us at inquiries@amti.com.ph.

Factory output continues slump in July

FACTORY OUTPUT declined for the fifth straight month in July, the Philippine Statistics Authority (PSA) reported earlier this morning.

Preliminary results of the PSA’s latest Monthly Integrated Survey of Selected Industries showed factory output, as measured by the Volume of Production Index (VoPI), contracting by 11.9% year-on-year in July.

The decline was slower than the 12.5% decline recorded in June, but faster compared to the minus 8.5% reading in July 2019.

Year to date, the decline in factory output averaged 12.1% compared to the 8.8% decline in 2019’s comparable seven months.

In a statement, the PSA said the VoPI’s slower downtrend in July compared to June was brought about by the increases in the indices of three industry groups: petroleum products (400% in July from 16.1% in June); wood and wood products (14.4% from 19.9%); and chemical products (0.1% from 6.3%).

Seventeen out of 20 industry groups registered negative production in July with seven posting slower declines: footwear and wearing apparel (-33% from -41.4%); beverages (-21.4% from -22.7%); non-metallic mineral products (-19.4% from -29.9%); printing (-34.4% from -58.2%); miscellaneous manufactures (-7.2% from -18.8%); basic metals (-1.9% from -3.8%); and leather products (-28.1% from -36.4%).

Average capacity utilization — the extent to which industry resources are used in the production of goods — averaged 75.4% in July. Only seven of the 20 sectors registered capacity utilization rates of at least 80%. — Ana Olivia A. Tirona

Inflation hits 3-month low in August

INFLATION eased to a three-month low of 2.4% in August, bringing the average inflation to 2.5% so far this year, the Philippine Statistics Authority reported this morning.

Last month’s year-on-year inflation rate was slower than 2.7% in July 2020, but faster than the 1.7% in August 2019.

The latest reading, which was below the median estimate of 2.8% in a BusinessWorld poll conducted last week, fell at the low end of the Bangko Sentral ng Pilipinas’ 2.5%-3.3% forecast range for August. This was also the lowest since the 2.1% inflation rate in May 2020.

“The slowdown in inflation in August 2020 was primarily due to the deceleration in the inflation for the heavily-weighted food and non-alcoholic beverages, which slid at an annual rate of 1.8% during the period from 2.4% in the previous month,” the PSA said in a statement.

Year to date, inflation averaged 2.5%, still within the BSP’s 2-4% target band and slower than the 2.6% forecast for the entire 2020.

Core inflation, which excludes volatile prices of food and fuel, settled at 3.1% in August. This was slower than 3.3% in July, but faster than the 2.9% logged in August 2019.

Food-alone inflation eased to 1.7% from 2.5% the previous month, but was faster than the 0.3% a year ago.

Moreover, inflation for the bottom 30% income households logged in at 2.7%, slower than July’s 2.9%, albeit faster than August 2019’s 1.7%. In the eight months to August, inflation for this segment also settled at 2.7%

The consumer price index (CPI) for the bottom 30% modifies the model basket of goods to reflect the spending patterns of the poor. This compared to the headline CPI which measures inflation as experienced by the average household. — Marissa Mae M. Ramos

Villar’s plastic recycling program gives livelihood, helps solve lack of chairs and plastic woes

To date, about 1,056,000 kilos of plastic wastes have been collected and turned into armchairs in the plastic recycling program spearheaded by Senator Cynthia Villar. This move has helped provide livelihood while providing solutions to the country’s problem on solid waste management and the lack of chairs in public schools.

The first Villar Social Institute for Poverty Alleviation and Governance (Villar SIPAG) Waste Plastic Recycling Factory was established in Barangay Ilaya, Las Pinas City in March 2013. Two other plastic factories were built in San Miguel, Iloilo and Cagayan de Oro City in 2017 and we increased the capacity of Las Pinas plastic factories to 600 chairs chairs per month.

Since then, more than 52,800 chairs have been donated for free to public schools, learning sites and government and non-government associations all over the country.

“In turning plastic wastes into useful furniture like school chairs, we are not only reducing the amount of plastic garbage that goes into our water resources, which harms the environment. We are also able to provide livelihood sources to the poor, because the jobless, the non-skilled and even the physically disabled are employed by the factories,” Villar said.

When it was inaugurated, the Php 6-million Las Pinas plant was only the second of its kind. About 20 kilos of mixed “soft plastics”—such as food wrappers—are needed to make a chair, which can be fashioned to look like wooden pieces and comes with replaceable parts.

Workers from the community are employed to collect and segregate the plastic wastes, which are then shredded, washed, dried, melted and molded in the plant.

Contaminants found in the raw materials are removed in the process. Tests show that armchairs had low levels of lead (42 parts per million) and no traces of mercury.

Villar, chairperson of the Committee on Environment and Natural Resources, emphasized that environmental protection, particularly proper waste disposal and handling and recycling, is very important with or without a pandemic.

“We continue to generate waste even if we are under quarantine. If disposed improperly, waste will overwhelm our landfills and will clog our drainage. This will cause flooding and contribute to the spread of diseases,” she said.

With a capacity to produce 300 chairs a month, the first plastic factory in Las Pinas has manufactured more than 10,800 chairs in 3 years and increased its capacity at 600 chairs per month in 2017 of which are already donated to public schools in Benguet, Apayao, Kalinga, Ilocos Sur, La Union, Pangasinan, Ilocos Norte, Isabela, Cagayan Valley, Compostela Valley, Nueva Vizcaya, Bataan, Bulacan, Nueva Ecija, Zambales, Pampanga, Aurora, Tarlac, Cavite, Laguna, Batangas, Rizal, Quezon, Occidental Mindoro, Oriental Mindoro, Albay, Camarines Norter, Camarines Sur, Catanduanes, Sorsogon, and Masbate.

Gomburza Elementary School, Caloocan
Barangay Bangyas, Calauan, Laguna

It also donated to public schools in the National Capital Region; namely, Caloocan, Las Pinas, Makati, Malabon, Mandaluyong, Manila, Marikina, Muntinlupa, Paranaque, Pasay, Pasig, Quezon City, San Juan, Taguig and Valenzuela.

Also in partnership with former Vice President Noli De Castro’s Kabayan Special Patrol,school chairs were distributed to far flung areas and indigenous communities.

Farm schools, TESDA learning centers, private companies, non-government organizations, and civic groups in Luzon are also beneficiaries of the program. We also donated chairs to Iloilo, Capiz, Negros Occidental, Leyte, and Northern Samar.

The latest batch of armchairs manufactured by the Las Pinas plant was donated last month to San Juan Science High School in San Juan City, Longos Elementary School in Malabon City, and Gomburza Elementary School in Caloocan City. Armchairs were also turned over to farm schools and learning sites in San Felipe and San Narciso in Zambales; Calauag, Quezon; and Guimba, Nueva Ecija.

Since the Iloilo plastic factory started operations in 2017, school chairs have been donated to 75 public schools in the provinces of Iloilo, Negros Occidental, Samar, Aklan, Capiz, Romblon, and Antique. Also donated are chairs to ten local government units in the Visayas and a senior citizen’s association in La Carlota.

Villar Sipag Plastic Waste Recycling Factory at Barangay San Jose, San Miguel, Iloilo
Donation of 50 chairs to the local government unit of Oton Iloilo
Donation of 50 chairs to the local government unit of San Dionisio, Iloilo

The plastic factory in Cagayan de Oro was able to produce armchairs for public schools, TESDA schools, homeowner’s association, senior citizens’ organization and local government units in Lanao del Norte, Lanao del Sur, Davao del Sur, Davao del Norte, Davao, Misamis Occidental, Misamis Oriental, Bukidnon, Zamboanga del Norte, Cagayan de Oro, and Basilan.

Villar has sounded the alarm on the country’s worsening problem on plastic wastes. Citing a study from the University of Georgia, the Philippines is the Top 3 largest producer of plastic waste leaking into the ocean, next to China and Indonesia.

She authored Senate Bill No. 1331 or the Extended Producers Responsibility (EPR) Act of 2020 which seeks to institutionalize the practice of EPR in waste management. It also amends the 20-year-old Republic Act 9003 or the Ecological Solid Waste Management Act.

“This measure makes sure that the responsibility for the entire life cycle of plastic products rests on the manufacturers. It will mandate manufacturers to recover plastic wastes from their products as a mechanism towards achieving an efficient solid waste management,” Villar said.

The Nacionalista Party senator also authored Senate Bill 333 or the Single-Use Plastic Product Regulation Act, which seeks to regulate the manufacturing, importation, and single-use of plastic products.

“We should encourage Filipinos to be responsible stewards of the environment. There should be a shared responsibility among us when it comes to waste management. There is no exception because we all generate wastes,” said Villar.

Villar Sipag Plastic Waste Recycling Factory at Gran Europa, Barangay Lumbia, Cagayan De Oro City
Kabulawan Elementary School, Lagonglon, Misamis Oriental
Bukidnon National High School, Malaybalay City
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