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Hamilton sweeps to dominant victory in Belgium

LEWIS HAMILTON took another step towards a record-equalling seventh Formula One title on Sunday with a dominant lights-to-flag victory in the Belgian Grand Prix.

The Briton, who had started from pole position after an inspired qualifying display, was at the front for every single lap as he led teammate Valtteri Bottas across the line for a Mercedes one-two.

Hamilton looked to be in perfect control in the lead after retaining his advantage at the start and down the long flat-out blast to the Les Combes chicane despite a snap of oversteer.

The durability of his tires, which stirred memories of his winning three-wheeled limp to the line at his home British Grand Prix, raised some concern for the champion.

But even those worries, which injected a hint of jeopardy into the otherwise straightforward race, proved unfounded as he crossed the line a comfortable 8.4 seconds clear of his Finnish stablemate.

“I know it’s not necessarily what everybody always wants to see, a Mercedes at the front,” said Hamilton, who now has a 50-point lead in the championship over Bottas and is 47 ahead of Red Bull’s third-placed finisher Max Verstappen.

“But no matter how much success we have, we just keep our heads down.”

Hamilton’s win was the 89th of his career, putting him ever closer to matching Michael Schumacher’s seven title triumphs and leaving him just two short of the German’s record tally of 91 race victories.

It was also the champion’s fifth win from seven races so far this season and the fourth of his career on the Spa-Francorchamps track.

Bottas, winner of the season-opening Austrian Grand Prix but now effectively two whole race victories behind Hamilton, said: “I think Lewis was faultless today.”

“Pretty boring”

Verstappen, the only non-Mercedes winner so far this year, took his sixth consecutive podium but dubbed the race ‘boring.”

“I ran out of tires at the end, so I was just stretching it out, saving the front tires,” said the 22-year-old, who had a lonely afternoon after a first-lap battle with former teammate Daniel Ricciardo.

“It was not enjoyable out there today.”

Ricciardo finished fourth for Renault, while also taking the extra point for fastest lap. Teammate Esteban Ocon rounded off a strong weekend for the French manufacturer by snatching fifth on the last lap from Red Bull’s Alexander Albon.

Lando Norris, the sole McLaren in the race after teammate Carlos Sainz failed to make the start due to an exhaust issue, was seventh while Alpha Tauri’s Pierre Gasly took “Driver of the Day” honors in eighth. — Reuters

US Open players lament the sound of silence

NEW YORK — As chatty spectators so often learn the hard way, silence is golden in the sport of tennis.

Yet facing the prospect of empty stands at the first fanless Grand Slam since the coronavirus outbreak, even top contenders at this year’s US Open admit that the unprecedented new hush will take some getting used to.

Australian Open champion Sofia Kenin told reporters how fans bring out the best in her.

“When it’s tough moments, they obviously are there on their feet cheering for you,” Kenin said, ahead of the tournament’s start on Monday. “I really wish they would be here. They really help me.”

Flushing Meadows fans are notoriously raucous — by tennis standards, at least — as thousands of them usually pack into the sprawling Billie Jean King National Tennis Center, sipping signature “Honey Deuce” vodka cocktails under sunny skies.

Night sessions can get especially boisterous, but not this year.

Gloomy weather and a sparsely populated plaza, speckled with rain, on Saturday foreshadowed a very different ambience for when the event kicks off on Monday.

The tournament is being played without fans and in a biosecure bubble because of the COVID-19 pandemic.

Andy Murray, who claimed his first Grand Slam title in New York in 2012 in an epic final against Novak Djokovic under the Arthur Ashe Stadium lights, said that while the tranquil atmosphere had its advantages, it was a sad situation.

“You know that there’s no one around, that you’re not going to get stopped. Yeah, it’s very quiet and very relaxed,” the Briton said of his practice sessions.

“Then there’s also been times like after one of my practices last week, I was walking back to the locker room, I was walking through the grounds. I was like, ‘Wow,’ this is pretty sad because usually this place is just filled with energy and atmosphere like before the tournament starts.

“Now it’s tennis players and their teams walking around with masks on. Fans give life to the tournaments.”

Another former champion, Belgium’s Kim Clijsters said the lack of atmosphere on court will also feel strange as she returns to a Grand Slam for the first time since announcing her second comeback to the sport.

“We’ve seen in the past, many moments where the crowd, the energy of the crowd, the momentum changes because of one rally or something,” four-time Grand Slam champion Clijsters said.

“Some players really thrive on those kind of moments.”

For world number six Stefanos Tsitsipas, who has never made it past the second round and into the spotlight of a night match on Arthur Ashe Stadium, the change is difficult to swallow.

“It’s like a dream for everyone, to play a night session match on Arthur Ashe. It’s been a dream of mine since forever. We won’t have the opportunity this year,” he said. — Reuters

India becomes world’s new virus epicenter

INDIA is fast becoming the world’s new virus epicenter, setting a record for the biggest single-day rise in cases as experts predict that it’ll soon pass Brazil — and ultimately the US — as the worst outbreak globally.

As many as 78,761 new cases were added Sunday, the most any country has ever reported in one day, while 971 deaths were reported on Monday, pushing the Asian country past Mexico for the third-highest number of deaths worldwide. At the current trajectory, India’s outbreak will eclipse Brazil’s in about a week, and the US in about two months.

And unlike the US and Brazil, India’s case growth is still accelerating seven months after the reporting of its first coronavirus case on Jan. 30. The pathogen has only just penetrated the vast rural hinterland where the bulk of its 1.3 billion population lives, after racing through its dense mega-cities.

As the world’s second largest country, and one with a relatively poor public health system, it’s inevitable that India’s outbreak becomes the world’s biggest, said Naman Shah, an adjunct faculty member at the country’s National Institute of Epidemiology.

“It would not be surprising, regardless of what India does,” said Shah, a member of the Indian government’s COVID-19 task force.

From the Philippines to Peru, the novel coronavirus poses a unique problem to poor countries: the densely packed slums where millions of their citizens live present ideal conditions for the virus to spread, while their economic precariousness means that the shutdowns necessary to contain the pathogen are intolerable.

Across the developing world, economies have been forced to open up even with the virus still running rampant, quickly overwhelming underfunded hospitals.

The list of worst-affected countries globally has accordingly shifted from rich to poor as the pandemic races around the world. Where once countries like Italy, Spain and the UK had the biggest outbreaks and highest death tolls, now the US is the only advanced economy in the top ten, among other developing nations like Mexico, Peru and South Africa.

Nowhere has the developing world’s plight played out more viscerally than in India, where an ambitious national lockdown imposed in March was lifted after two months as joblessness, starvation and a mass migration of workers leaving cities on foot became too much to bear.

Prime Minister Narendra Modi’s government has since counseled the population to “live with the virus” while giving local officials freedom to impose restrictions on a state-by-state basis, which many have. The economy is projected to have contracted 18% in the quarter to June from a year ago, more than any other major Asian country.

With antibody studies in capital New Delhi and other cities showing that the number of people with signs of past infection is between 40 and 200 times greater than the official case count, the true size of India’s epidemic is probably far larger than its reported 3.6 million infections.

And there is every reason to believe that the coronavirus is still only getting started in India. Much of the country’s coronavirus burden so far has fallen on its globally connected megacities like New Delhi and Mumbai, but the disease is now starting to shift to its rural hinterland where nearly 900 million people live, and healthcare infrastructure is sparse. A lack of testing and medical help will likely mean that scores of infections and deaths are going unreported.

“The disease is moving from urban to rural areas, it’s moving from states with better healthcare infrastructure to other places,” said Ramanan Laxminarayan, director of the New Delhi and Washington, DC-based Center for Disease Dynamics Economics and Policy. “That all means that there will be more death, but they will not be counted because they will not be visible anywhere.”

The Modi government has often pointed to India’s official mortality rate of around 1.8% — among the lowest in the world — as evidence that it is managing the virus’ spread, even if not containing it.

But deaths are likely substantially under-reported, and skewed by the country’s disproportionately young population — 65% are below the age of 35, the segment least in danger of dying from COVID-19 (coronavirus disease 2019). An age-adjusted analysis of India’s death rate by three economists at the National Bureau of Economic Research in Massachusetts found that India’s death rate was similar to the global average.

“What we’ve done is delayed infections, but we haven’t been able to curtail the transmission,” said CDDEP’s Laxminarayan. “And that was never going to be possible in a country the size of India and with the health infrastructure India has. What has played out is almost exactly what one should have expected.” — Bloomberg

Trump seeks ‘law and order’ in tweetstorm on Portland death

PRESIDENT Donald Trump unleashed a tweetstorm early Sunday about Portland, Oregon, hours after a man was killed there during clashes between a large group of Mr. Trump supporters and Black Lives Matter demonstrators.

The string of messages enlivened criticism from Democrats, including presidential candidate Joe Biden, that Mr. Trump is looking to inflame unrest in US cities because he believes it will help his re-election campaign.

The president retweeted a post that had used a profanity to describe Portland Mayor Ted Wheeler — commenting only to “Tone down the language, but TRUE!” — and others in which the original tweeters accused the mayor, a Democrat, of “war crimes” and of having blood on his hands.

Portland has been the site of protests, often violent, for months, following the killing of a Black man, George Floyd, by police in Minnesota in late May.

While labeling Black Lives Matter protesters in Washington as “agitators and thugs,” Mr. Trump praised as “GREAT PATRIOTS” the hundreds of his supporters who rolled into the city in a convoy of cars and trucks on Saturday. He concluded a string of dozens of tweets with the slogan “LAW AND ORDER!!!”

Video posted on Twitter from Portland showed some of the caravan participants driving pickup trucks into protesters and shooting what appeared to be tear gas and paint balls.

The man shot to death on Saturday night was a supporter of a right-wing group that’s frequently clashed with other demonstrators there. He was identified by the group Patriot Prayer as Aaron “Jay” Danielson, who also went by Jay Bishop. Mr. Trump tweeted “Rest in Peace Jay!”

In a lengthy statement, Mr. Biden said “it isn’t a peaceful protest when you go out spoiling for a fight.”

“I condemn violence of every kind by anyone, whether on the left or the right. And I challenge Donald Trump to do the same,” Mr. Biden said in a statement Sunday.

Mr. Biden said “the job of a president is to lower the temperature” and Mr. Trump’s “failure to call on his supporters to stop seeking conflict shows just how weak he is.”

Mr. Wheeler, the Portland mayor, hit back at Mr. Trump during a press conference. “It’s you who have created the hate and the division,” Mr. Wheeler said of the president. “You’ve tried to divide us more than any other figure in modern history. And now you want me to stop the violence that you helped create.” — Bloomberg

Analysts’ August inflation rate estimates (2020)

THE inflation likely edged higher in August, as food prices and transportation costs rose when lockdown restrictions were brought back for two weeks earlier in the month, analysts said. Read the full story.

Analysts’ August inflation rate estimates (2020)

Inflation likely edged up in August

Gasoline prices rose by 96 centavos in August, data from the Energy department showed. — PHILIPPINE STAR/MICHAEL VARCAS

THE inflation likely edged higher in August, as food prices and transportation costs rose when lockdown restrictions were brought back for two weeks earlier in the month, analysts said.

A BusinessWorld poll of 16 economists held last week yielded a median estimate of 2.8%, settling within the middle of the 2.5% to 3.3% forecast range provided by the Bangko Sentral ng Pilipinas (BSP) for the month.

If realized, the median estimate will be slightly faster than the 2.7% seen in July as well as the 1.7% logged in August 2019. However, it will still be within the 2-4% target by the central bank for this year.

So far, headline inflation averaged 2.5% in the first seven months of 2020. The BSP expects inflation to average 2.6% this year.

The Philippine Statistics Authority will report the official August inflation data on Friday (Sept. 4).

Analysts said the uptick in commodity prices was driven mainly by food and transport costs.

“Food prices remain supportive of overall inflation, and an increase in transport costs also likely contributes to some headline gains,” Jessie Lu, an economist from Continuum Economics, said in an e-mail.

Other commodities that also saw higher prices include communication and health expenses, said John Paolo R. Rivera, an economist from the Asian Institute of Management.

The return of the modified enhanced community quarantine (MECQ) in the first two weeks of August likely contributed to higher commodity prices, according to UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion.

“Note that gas prices have also increased during the month a number of times, as global oil prices notched upticks,” he added. 

Global oil prices rose in August as demand improved on easing lockdown restrictions in most countries. Data from the Energy department showed that since Aug. 11, domestic oil companies have raised the price of gasoline by a total of P0.96 per liter.

During the strict MECQ, trains, buses, jeepneys, taxis, and transport network vehicle services were not allowed to operate. Tricycles were operating depending on local government rules and companies were encouraged to provide shuttle services for employees.

Meanwhile, ING Bank N.V. Manila Senior Economist Nicholas Antonio T. Mapa expects August inflation to settle at 2.7%, unchanged from July, with price gains likely fueled by transport fares.

“All other items will likely have subdued price trends given depressed demand due to the economic recession,” he said.

The country plunged into a recession after the economy contracted by 16.5% in the second quarter, as the lockdown measures hurt economic activity. 

Most analysts expect inflation to tick up, but said the BSP remains armed with bullets to accommodate easing when needed to aid the economy’s recovery from the pandemic.

“We still hold the view that the risks are skewed to see lower rates and since inflation is not a factor due to the relatively benign price pressures at the moment,” Sunlife Financial economist Patrick M. Ella said.

The next rate cut could come as soon as the next meeting, said Alex Holmes, an economist from Capital Economics, noting the within-target inflation trajectory “would provide no impediment for further easing.”

Given the worst-than-expected impact of the virus, the BSP is even likely to continue being accommodative and may delay any notable policy normalization to 2022, said Ms. Lu.

On the other hand, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the central bank may not go for further rate cuts as inflation is already outpacing the key policy rate of 2.25%.

The central bank maintained the overnight reverse repurchase, lending, and deposit rates at record lows of 2.25%, 2.75% and 1.75%, respectively in its Aug. 20 policy review. It cited the continued benign inflation outlook as well as some early signs of economic recovery as reasons for the “prudent pause.”

Before this, the central bank had already slashed rates by 175 basis points this year.

BSP Governor Benjamin E. Diokno has said the BSP may keep its monetary stance in the next few quarters as their previous actions were already anticipatory and as they wait for the market to fully digest what they have done so far. He, however, assured the BSP can do more “if warranted.”

The Monetary Board will have its fifth policy review this year on Oct. 1. — Luz Wendy T. Noble

Analysts’ August inflation rate estimates (2020)

Corporate income tax cut to create more jobs — study

THE unemployment rate surged to 17.7% in April, the height of the Luzon-wide lockdown. — PHILIPPINE STAR/EDD GUMBAN

THE proposed reduction in corporate income tax, coupled with the overhaul of the fiscal incentive system, will help reduce poverty by at least 4.9 percentage points, create jobs and attract foreign investments, a study commissioned by the Labor department showed.

In a statement, the Finance department said lower corporate income tax and the modernization of fiscal incentives will boost the employment rate across all sectors and reduce poverty incidence, citing the study “The Potential Economic Effects of Reducing Philippine Corporate Income Tax and Reforming Sectoral Incentives.”

“Any reduction in corporate income tax needs to be accompanied by a compensatory sector tax (referring to the reforms in fiscal incentives) for the reduction to be growth-enhancing, employment generating and poverty reducing,” the Department of Finance said, quoting the study.

The study was conducted by Caesar B. Cororaton, a research fellow at the Virginia Polytechnic Institute and State University and Marites M. Tiongco, a professor at the De La Salle University (DLSU) School of Economics, before the coronavirus pandemic. It was based on the Corporate Income Tax and Incentives Rationalization Act (CITIRA) bill’s provision that sought to gradually cut the current 30% corporate income tax to 20% over a 10-year period.

However, since the pandemic started, the CITIRA has been repackaged as the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE). CREATE, which is still pending at the Senate, seeks an immediate corporate income tax cut of 25%, which would then be  lowered to 20% by 2027.

Sought for comment, Labor Secretary Silvestre H. Bello III said the reduction in corporate income tax and the rationalization of fiscal incentives would create over a million jobs in the next decade.

“Yes, potentially the decrease in corporate tax will yield some 1.4 million jobs in 10 years and will rationalize any corporate incentive to performing corporations only and cannot be accessed perpetually. Also, the decrease in tax will allow companies to allocate that money to hiring more workers,” Mr. Bello said via Viber on Sunday.

The study showed if the corporate tax rate was lowered to 20% without rationalizing the incentive system, the deficit would rise to 4.3% by 2029. It also noted employment and real wages would drop, while poverty incidence would increase.

“Corporate income tax is a major source of government revenue. Reducing this source could put a lot of pressure on government finances. Increasing taxes on select sectors to reform the fiscal incentives reduces the pressure on government finances,” it said.

If the savings from a lower corporate tax rate will be fully reinvested in the country, the study estimated up to P1.08 trillion of new investments will be generated by 2029 when the rate is lowered to 20% as originally proposed. Under this scenario, 212,000 more jobs will be created this year or up to 2.3 million by 2029. It said GDP growth could also reach 8.2% in 2029.

The study also showed inflow of foreign direct investments (FDI) could reach P1.75 trillion by 2029, noting that the “reduction in prices is higher under this scenario as the inflows of FDI expand the aggregate supply in the economy.” It also assumed that the government would cap its budget deficit at 3.2% of gross domestic product and fully implement the “Build, Build, Build” program.

Since the study was done before the pandemic, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion stressed the need to be cautious in interpreting the data now since the coronavirus pandemic has dealt a serious blow on the economy.

“The original simulation results may look different taking into account these potential damages. Looking at the economy, in employment specifically, there may be jobs in certain sectors that may or may not come back any more. Some jobs may be slow to come back as well. Thus, we must be careful in the interpretation,” Mr. Asuncion said via e-mail on Sunday.

He said the measure still has a “positive impact” and an “essential part of the bumpy road to economic recovery.” — Beatrice M. Laforga

Policy makers cool to lowering VAT on internet services

THE PHILIPPINES scored low in the Digital Quality of Life Index 2020 due to its expensive and low-quality internet. — REUTERS

By Arjay L. Balinbin, Senior Reporter

LOWERING the value-added tax (VAT) imposed on internet services would be the fastest way to make it more affordable in the Philippines, an expert said. But policy makers are cool to such a proposal, saying it will not help improve the overall internet infrastructure and quality.

In its Digital Quality of Life Index 2020 released earlier this month, the research arm of information technology firm Surfshark Ltd. found the Philippines had one of the world’s worst internet affordability and quality, ranking 79th and 84th, respectively, out of 85 countries.

Surfshark’s Digital Quality of Life (DQL) Research Head Dom Dimas said the Philippines should address the factors that directly influence the affordability of the internet such as net wage (after tax), internet price, and the length of workweek.

“To improve affordability in the shorter run, the incentives should focus on softening the price burden to end consumers, for instance, by decreasing the VAT of telco services,” he said in an e-mailed reply to BusinessWorld’s questions.

Mr. Dimas said the Philippines should also focus on increasing the levels of competition that would force telcos to compete on prices and invest more on infrastructure to offer better services.

“Also, governmental agencies can influence affordability by incentivizing the telcos in terms of network development,” he said, noting this can be done by shortening the licensing process for operations.

“Usually, the length of the regulatory hearings for getting a license can discourage new entrants from proceeding. Besides, the process favors the big players to enter by requiring high speed and investment commitments.

The government can also sponsor infrastructure expansion to regions that are not financially profitable, Mr. Dimas added.

‘FLEETING PRICE REDUCTION’
House Ways and Means Committee Chairman Albay Rep. Jose Maria Clemente S. Salceda said lowering the 12% VAT on internet services would provide an “immediate but fleeting price reduction.”

“Price is a symptom of the real problems: infrastructure and quality. If you do just the VAT reduction, soon enough, maybe a year after, you’ll be back to the higher price where you started,” Mr. Salceda said in a phone message.

He warned the lasting consequences of such a move would be “overwhelmingly negative.”

“We will lose revenue for digital infrastructure, which is the real inadequacy, while not addressing any of the real causes of bad and expensive internet in the Philippines. The prices will keep rising for lower quality until we tackle the real causes of expensive and unreliable internet in the country. You take out VAT now, but you don’t solve any of the causes, you’ll end up getting a temporary price reduction that you will lose soon enough,” Mr. Salceda said.

Instead, Mr. Salceda proposed the liberalization of the use of satellites for internet connectivity. He said the proposed Faster Internet Act would help further develop internet infrastructure and improve competition in the industry.

‘NOT SIGNIFICANT’
Information and Communications Technology Undersecretary Ramon P. Jacinto said lowering the VAT on internet services would not have a significant impact.

“The real solution is to lower the cost of the source of the bandwidth and cost of  delivery to the end user which can be achieved once the Facebook optic fiber, which the government is hosting and is crossing Luzon, is in operation and the connection to the National Grid, which is part of the National Broadband Plan, is in operation,” he said in a phone message.

Philippine information and communications industry (ICT) expert Eliseo M. Rio, Jr., a former DICT undersecretary, said in a phone interview there is no need to lower the VAT on internet services as telcos can actually invest in infrastructure development.

Mr. Rio said telcos and the government are already focusing on improving the infrastructure, especially after President Rodrigo R. Duterte threatened to expropriate the country’s two telecoms firms if they fail to improve their services by December.

“The December deadline will not be realistic or possible without government intervention in addressing the red tape involved in putting up telecommunication infrastructure. The government had moved in this direction when it recently announced that permits had been granted to put up more than 1,200 cell sites and these will be operational by December,” Mr. Rio said.

“Also approval of permits in laying out fiber optic cables have also been facilitated. This is a big step in improving the quality of service of our telcos. The problem is not the lack of incentives or investments to put up telecommunication infrastructure. For more than two decades, red tape that cost telcos billions of pesos had made our telecommunication services poor and expensive,” he added.

For his part, Senate President Pro Tempore Ralph G. Recto said in a phone message that cutting VAT on internet services would be doable even during the pandemic. “Yes, that’s a no-brainer,” he said.

According to Surfshark, mobile and broadband internet affordability in the Philippines has actually increased this year.

“Meaning that time to afford the cheapest mobile internet package of 1 gigabyte (GB) decreased from 34 minutes to 32 minutes and 24 seconds, which translates to almost a 5% decrease in the time of work needed,” Mr. Dimas explained.

The work time required to afford broadband services also decreased from 645 minutes to 439 minutes, meaning “around 32% decrease in the time of work needed to afford the cheapest broadband package,” he added.

Annie & Lori marches on despite COVID, releasing a new nationalistic, eco-friendly collection

IN THESE dark times, local shoe brand Annie & Lori finds hope and light in the nation and in nature.

Just last January, Annie & Lori reached a high when it was featured in that month’s issue of British Vogue, under the Designer Profile section. The world has drastically changed since then, and like most industries during this pandemic, the shoe industry has taken a beating.

“The past months have been a struggle for us but we want to keep marching on and to continue supporting Filipino artisans,” says Faith Mijares, head designer of Annie & Lori in a press release. In an e-mail to BusinessWorld, she says about these same artisans, “They were forced to stop working when we were in ECQ. When we shifted to GCQ, [and] some of them who live nearby got to go to work by walking or biking. For those who had to walk, their schedules have been adjusted accordingly.

“No one was spared by the pandemic. But we continue to adapt and make necessary adjustments to keep our business afloat,” she added.

The line is known for its sandals made using vegetable-tanned leather, introduced in 2019. The method reduces the brand’s carbon footprint and reliance on harmful chemicals used in the tanning process. The sandals have been seen on the feet of Miss Universe Catriona Gray, as well as Filipina Victoria’s Secret model Kelsey Merritt. In a previous interview with BusinessWorld, Ms. Mijares said, “The vegetable tanned leather collection is our most eco-friendly collection to-date, but we are committed to discovering and using more eco-friendly materials in the future.”

Its latest collection — released as much of the world is locked down because of the COVID-19 pandemic — is named Sako (sack), and it is certainly eco-friendly as it uses jute, a plant-derived fiber usually used to make, well, sacks.

“Our main goal was to truly differentiate, make a positive impact in the environment and at the same time highlight what’s unique and truly Filipino aligning with our minimalist aesthetics, hence we ended up with this Sako Collection. It was never easy to marry these initiatives, but we are glad we made it happen,” she said.

“It’s definitely hard when you’re working with something that you’re not used to especially during the early stage. But eventually we were able to adjust into it,” she said of working with jute instead of the leather they are used to. “We made sure that as much as possible, the jute material we used is natural, hence please expect imperfections in our Sako Collection.”

The design inspiration takes off from elements found in the Philippine flag. For example, the Sako pump, in white, is embroidered with little suns that look like the one in the nation’s flag. Meanwhile, a pair of loafers is accented with red leather, much the same crimson hue as that displayed in our flag. The sandals are still there, of course, joined by a taller, platform-soled sister.

“The very essence of nationalistic designs is to spread positivity and uplift the morale of every Filipino. We hope to spread the message that there is always something that we can be proud of as Filipinos despite what is happening in our country,” said Ms. Mijares.

She places the choice of material and its role as a plant-based fiber in the brand’s goals for sustainability. “If you’ll look into the global situation, there is a strong outcry for sustainable methods, for more environmentally friendly products. We are ‘local,’ but we have growing global recognition, hence we wanted to align ourselves and contribute,” she said.

“At the end of the day, we all live on the same planet and in our own small way, we can help protect it.”

For more information about the brand (and to purchase a pair), visit  www.annielori.com, or follow Facebook: www.facebook.com/annieandlori and Instagram @annieandlori. — Joseph L. Garcia

Holidays won’t bring cheer to airlines

By Arjay L. Balinbin, Senior Reporter

LOCAL AIRLINES probably won’t benefit from the usual holiday traffic this year as travelers remain wary amid a coronavirus pandemic, analysts said.

“People are still apprehensive about travel,” Avelino D.L. Zapanta, a Philippine aviation industry expert, said in an e-mailed reply to questions.

“There will be no tourists because tourist spots are closed. Visiting friends and relatives will not happen. Either the visitor brings the virus to friends and relatives or he gets it from such friends or relatives he would visit. They will play it safe and stay home,” he added.

Business travels also would be limited because many companies are cost-cutting if not closed, said Mr. Zapanta, a former chief executive officer at Philippine Airlines (PAL). “I see no miracles happening during the ‘ber’ months.”

The COVID-19 pandemic has brought travel and tourism to a near standstill as governments around the world locked their borders to contain the pandemic.

Airlines expect a 55% decline in 2020 air traffic, according to airline trade group International Air Transport Association (IATA).

The second half would remain challenging for airlines as the virus continues to disrupt the industry, said Japhet Louis O. Tantiangco, a senior research analyst at Philstocks Financial, Inc.

Sales might not exceed first-half figures “as we expect passenger revenues to remain anemic given the limitations in place with travels narrowed to the essentials,” he said in an e-mail.

Investors are also expected to remain bearish about shares of Cebu Air, Inc., which operates low-cost carrier Cebu Pacific, and PAL Holdings, Inc., operator of flag-carrier Philippine Airlines, Mr. Tantiangco said.

Cebu Air shares have been falling after peaking at P55 each on June 9. The stock is nearing its March 2020 low of P35 and could fall further to its 52-week low of P31.05 posted on May 26, he said.

PAL shares have also been dropping since last year — even before the coronavirus pandemic — after the company posted dismal financial results, he added.

The stock recently went below its P6 support level — the price that prompts traders to buy the share — and could drop further to its March 19 low of P5 each, Mr. Tantiangco said.

Cebu Pacific’s net loss widened to P9.14 billion in the first half from P7.14 billion a year earlier. PAL’s net loss also worsened to P20.93 billion from P3.33 billion a year earlier.

“I am reminded of what we used to do at PAL at the approach of the holiday peak season,” Mr. Zapanta said. “We suspend all leaves and mobilize even office staff members to serve in the line. In December, we set up a campaign we labeled as the Christmas airlift. No matter how I wanted to convince myself that that would be the case for the coming months, I see no reason to be optimistic.”

PAL operates at 15% of its capacity.

“On the domestic front, there will be a slight increase in flight frequency this September,” PAL spokeswoman Cielo C. Villaluna said in a mobile phone message. “However, more local governments are requiring additional documents as prerequisites to enter their borders.”

Zamboanga, General Santos City, Davao, Iloilo, Bacolod, Puerto Princesa, Laoag, Butuan and Ozamiz require passengers to present negative coronavirus test results, she pointed out.

PAL has regular international flights from Manila to Los Angeles, San Francisco, New York, Toronto, Vancouver, London, Honolulu, Guam, Singapore, Kuala Lumpur, Doha, Riyadh, Dammam, Dubai, Taipei and Hong Kong. It also has flights to Sydney, Jakarta, Seoul and Saigon.

Safe Travel Barometer, a unit of travel industry consulting firm VIDEC, has identified the flag carrier as one of the top 10 airlines with the highest safety credentials for travel during the pandemic, Ms. Villaluna said.

Cebu Pacific said it would fly to more domestic and international destinations beginning September.

These include Zamboanga, General Santos, Davao, Iloilo, Bacolod, Puerto Princesa, Laoag, Butuan and Ozamiz, Candice A. Iyog, Cebu Pacific vice-president for marketing and customer service, said in a mobile phone message.

“As the situation remains fluid, we can only keep hoping we will be able to continue boosting our network,” she said. The airline now operates at 10% capacity, Ms. Iyog said.

While most countries have eased travel restrictions, travelers are put off by strict quarantine rules.

“Governments must look at a coordinated way to lift travel restrictions and find alternatives to quarantine requirements,” IATA said in a statement posted on its website on Aug. 13. “International cooperation to isolate and precisely manage risks is critical to rebuilding confidence in travel.”

While aviation faces a long-haul recovery, continued aid and assistance for the sector is desperately needed, IATA said.

“With a recovery to 2019 levels now slipping to 2024, financial support, in forms which do not further load crippling debts onto the industry, will be necessary if an even sharper contraction in airline capacity and jobs is to be avoided,” it added.

PSALM subsidy budget cut to P8B in 2021 budget bill

THE GOVERNMENT has cut the subsidy under next year’s national budget for debts of the National Power Corp. (Napocor) that are now being charged on consumers.

The Budget and Finance departments lowered the Power Sector Assets and Liabilities Management Corp.’s (PSALM) subsidy by 86% to P8 billion.

State-owned PSALM had proposed a P46.04-billion subsidy budget but it was lowered further “due to limited fiscal space,” the state-owned company said in a statement.

PSALM, which was created by a law reforming the power industry, inherited Napocor’s debt and stranded contract costs.

A measure enacted in August last year ordered the allocation of P208 billion to cover PSALM’s stranded contract costs and debt that are being charged on consumers as universal charges in their electricity bills.

The subsidy will come from the government’s share in the Malampaya natural gas project in Palawan province. The government will also pay for shortfalls incurred from settling the debt.

PSALM is not recovering stranded contract costs but is still collecting the P0.0428 per kilowatt-hour for its stranded debt.

The application to collect the latter was approved before the so-called Murang Kuryente law was passed, and it will still be collected until the end of its corporate life, according to the Energy Regulatory Commission.

Stranded contract costs are the excess of Napocor’s contracted cost of electricity with independent power producers over the actual selling price of the output. Stranded debt refers to Napocor’s unpaid obligations.

PSALM cannot file for new applications to collect these charges from consumers until the government subsidy is exhausted.

However, it is still collecting the P0.0428-per-kilowatt-hour stranded debts charge which the Energy Regulatory Commission (ERC) signed off before the law became effective. The bill portion will be collected until the end of the agency’s corporate life in 2026.

Last week, consumer group Laban Konsyumer said the government must refund PSALM’s universal charges on consumers.

The Department of Budget and Management last week submitted to Congress the P4.05-trillion National Expenditure Program for 2021.

Speaker Alan Peter S. Cayetano said the House would try to approve the budget by September. — Adam J. Ang

Uniqlo launches collection for a ‘new lifestyle’

JAPANESE clothing brand Uniqlo has unveiled its Fall/Winter 2020 collection, which revolves around having clothes fit for the “new lifestyle,” with longtime collaborators British-Japanese designer Hana Tajima and French designer Ines de la Fressange introducing new styles for their respective lines.

The collection, which not only makes one yearn for a more normal outdoors (and holiday trips that were unfortunately cancelled), is all about “concepts impacting customers’ needs, wants, and aspirations,” according to the press preview on Aug. 27.

The Hana Tajima Fall/Winter 2020 collection is said to express “the world’s rich cultural diversity featuring universal designs with a focus on detail and comfort,” according to a press release.

Her collection features textiles with leaf and grass patterns and neutral tones of cold and warm colors to “emphasize subtle beauty.” The clothes are also meant for a relaxed fit to provide easy mobility and convenience and include loose-fitting shirt dresses and pants with adjustable waistbands, long skirts, long-sleeved tops, and matching separates; as well as an a-line dress in the muted colors of fall and winter. In a release on the US website of Uniqlo, she says, “I have worn the clothes of many cultures. I have used them to try to better see the Japanese part of me. I have worn Salwar Kameez, Abaya, and kaftans given to me by friends when I became Muslim. I wore family hand-me-downs, and black patent leather heels. 

“These dualities, these different identities exist in all of us,” she said.

The Ines de la Fressange collection — her 14th with Uniqlo — meanwhile is inspired by “individuals who symbolized female freedom and independence in the 1970s” such as Jane Birkin, Ali MacGraw, and Diane Keaton.

“The Fall/Winter 2020 collection salutes their enduring inspiration for women today,” the statement read.

The collection features 100% silk blouses, and wrap dresses and knitwear made with 3D knit technology, all of which Ms. dela Fressange considers wardrobe essentials. The 1970s bohemian culture is represented by twist pleated skirts and dresses with polka dot and paisley patterns.

Alongside the collections from Ms. Tajima and Ms. De la Fressange, the Uniqlo Fall/Winter collections also featured essentials from its own Lifewear line all of which are aimed to “provide ease when staying at home or doing daily tasks, to help stay stress-free when working, and to give support in keeping active and healthy,” said the release.

There is the Uniqlo Airism line, a set of basics designed to wick away moisture, release heat, and absorb sweat. The fabric used for the line also has some antibacterial and deodorizing ability. The polyester fabric is also made to feel smooth and stretchy -— perfect for when you’re wearing it all day.

The same principle governs the relaunch of the brand’s EZY Ankle Pants, since renamed to Smart Ankle Pants. The line is made with two-way stretch material that stretches up and down and from side to side, giving comfort without restrictions and constrictions especially when sitting or stretching. For easy maintenance, a special resin treatment was also applied on the fabric so that the center pleats do not easily loosen even after several washes. The line, selling for P1,490, features a comfortable elastic waistband while still being deceptively dressy. A new collection of Ultra Stretch jeans have been designed with the same things in mind: stretchy, flexible comfortability.

Fall and Winter collections anticipate temperature drops, so an outerwear collection featured textured suede jackets and tweeds. There’s also some new colors for the water-repellant pocketable parka.

The collection is now available online via the Uniqlo Online Store (https://www.uniqlo.com/ph/en/), at the brand’s physical stores, and the Uniqlo App available on both the Google Play Store and the Apple App Store. — Zsarlene B. Chua, Joseph L. Garcia

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