PHILIPPINE international trade performance continued to shrink in April as exports and imports of goods plummetted to record lows, the Philippine Statistics Authority (PSA) reported this morning.
Preliminary trade data from the PSA showed merchandise exports in April contracting by 50.8% to $2.78 billion compared to a revised 24.7% decline in March and a 3.1% uptick recorded in April 2019.
Likewise, merchandise imports shrank 65.3% to $3.28 billion in April, a reversal from a 2.9% increase observed in the same month last year.
Based on available PSA data, April figures surpassed record 40.6% export drop in January 2009 and 37.1% import fall in April 2009.
Trade deficit in April was recorded at $499.21 million, narrower than the $3.80-billion gap in the same month last year.
The country’s total external trade in goods – the sum of export and import goods – was $6.07 billion in April, 59.8% less than the $15.10-billion total in the same month last year.
So far, total trade reached $45.06 billion, 23.1% less than $58.59 billion in January-April 2019.
From January to April, exports were down 16.7% to $18.52 billion, well below the 4% drop expected this year by the Development Budget Coordination Committee.
Meanwhile, the merchandise import bill declined 27% to $26.54 billion on a cumulative basis against the DBCC’s 5.5% contraction target for the year.
That brought the year-to-date trade balance to a $8.03-billion deficit, smaller than the $14.14-billion shortfall in 2019’s comparable four months.
Hong Kong was the Philippines’ top export market in April with 20.9% share at $582.07 million followed by China’s 13.8% ($385.28 million) and Japan’s 13.1% ($363.40 million) market shares.
The same month saw China as the country’s top source of imports with a 22.3% share at $732.47 million followed by Japan’s 10.9% ($357.55 million) and South Korea’s 9.1% ($299.54 million) share. — Lourdes O. Pilar
The Philippine economy’s contraction is expected to deepen in the second and third quarters, as the coronavirus crisis persists. — REUTERS
By Beatrice M. Laforga,Reporter
THE PHILIPPINE economy is projected to shrink by 1.9% this year as the coronavirus crisis continues, the World Bank said, estimating 1.2 million more Filipinos will slip into poverty as a result.
In its latest Philippine Economic Update, the World Bank (WB) slashed its gross domestic product (GDP) output forecast for the Philippines to -1.9% from the 3% baseline projection it gave in April and the 6.1% estimated in January.
“This projection assumes containment measures are gradually relaxed in the second half of the year, and economic activity returns in some sectors of the economy,” the World Bank said in the report.
If realized, the Philippine economy will suffer its first annual contraction in more than two decades or since the Asian Financial Crisis in 1998.
World Bank Senior Economist Rong Qian in a press briefing said they expect the economy’s contraction to deepen in the second quarter, and remain in recession until the third quarter before posting “muted growth” in the last three months of 2020.
The economy contracted by 0.2% in the first quarter, as lockdown measures curtailed economic activity in Luzon.
“The trajectory that we are seeing is deeper recession in the second quarter because the ECQ cover most of the second quarter, still a recession in the third quarter as the economy slowly, gradually come out of the ECQ and some sectors can return to business and more or less muted growth in the fourth quarter as the economy start to return,” Ms. Qian said.
For next year, World Bank maintained its 6.2% growth projection it gave in April and estimated a 7.2% growth in 2022 as the economy is expected to make a gradual recovery.
“Future economic growth will be dependent on public investments and a rebound in consumption as incomes recover, and there will also be base effects, given the economic contraction expected in 2020,” the World Bank said.
The Philippines is one of the countries to suffer “the biggest contractions” in East Asia and the Pacific this year, it said. Malaysia’s economy is seen to shrink by 3.1%, while Timor-Leste and Thailand are expected to contract by 4.8% and 5%, respectively.
However, the multilateral lender said the growth projections may be revised as the duration and full extent of the pandemic remains highly uncertain.
Ms. Qian also said the country’s growth trajectory follows the global economy, which is also projected to contract by 5.2% this year before bouncing back in 2021.
In its Global Economic Prospects Report, the World Bank said advanced economies are seen to contract by 7% this year, while emerging market economies will shrink by 2.5% — their first since 1960.
The World Bank said private consumption, the main growth driver for the Philippines, will also slump by 2.6% this year due to lockdown measures that resulted in income losses and lower remittances as other countries were also affected by the pandemic.
Consumption may rebound to 5.7% next year and 6.1% in 2022 “if the pandemic is resolved and containment measures are effectively managed,” it added.
Capital investment may sharply decline by 7.5% this year, reversing the 3.9% increase in 2019, on weak business sentiment.
The Development Budget Coordination Committee (DBCC) on May 27 projected the economy to shrink by 2% to 3.4% this year, before picking up to 8-9% in 2021 and settling within 6-7% in 2022.
World Bank’s Ms. Qian said the Philippines can still achieve upper middle income status by 2022 if the economy will be able to recover in the next two years.
POVERTY
As the economy slumps due to the pandemic, the World Bank estimated 1.2 million more Filipinos will slip below the poverty line this year.
“Poverty is projected to increase to 21.5% based on the middle-income poverty line of $3.20/day in 2020. This is equivalent to 1.2 million Filipinos more falling to poverty from the estimated poor in 2019,” the World Bank said.
It noted poverty incidence may increase by at least 3.3 percentage points this year, assuming there is a loss of two months’ worth of income, or a 16.7% drop in household incomes from seasonal wage and entrepreneurial activities in 2020, and no social protection measures in place.
With economic recovery seen in the next two years, World Bank said poverty rate could slowly decline to 20.4% in 2021 and to 19.1% by 2022.
“The outbreak clearly poses the risk of unraveling some of Philippines’ gains in poverty reduction in recent years,” it said.
However, the latest World Bank projections are higher compared to the estimates it made in April which showed the poverty rate seen to settle at 20.5% in 2020, 19.4% in 2021 and 18.3% in 2022.
The World Bank said the subsidy programs of the government, including the P200-billion social amelioration program, will partially offset the income losses of the poor. However, the cash distribution faced challenges, such as lack of proper data verification, slow implementation, exclusion errors, and logistical problems to reach remote areas.
“If these implementation challenges and delays continue as the government moves on to the next tranche of cash assistance, vulnerable households excluded in the program or did not receive benefits in a timely manner are likely to fall to poverty,” it said.
Moving forward, the World Bank stressed the need for the Philippines to adopt critical reforms to ensure sustainable economic recovery, especially ramping up the digital transformation deemed crucial under the “new normal.”
“The current state of the internet in the Philippines, however, calls for urgent and substantial improvements for the digital economy to play a key role in the economic recovery,” it said.
The World Bank said the country could be a “significant player in the global digital market” as the number of Filipino internet users continue to rise and its domination in the Information Technology and Business Process Outsourcing (IT-BPO) industry.
However, the Philippine digital economy lags behind its peers in the region, with digital adoption on par with its economic development compared to countries across the globe but “performed poorly compared with regional peers,” according to the World Bank.
“Increasing digital adoption and its contribution to economic growth requires government actions to create a conducive and competitive business environment,” it added.
THE PHILIPPINE economy is projected to shrink by 1.9% this year as the coronavirus crisis continues, the World Bank said, estimating 1.2 million more Filipinos will slip into poverty as a result. Read the full story.
THE Finance department expects the full disbursement of the $750- million loan from the Beijing-based Asian Infrastructure Investment Bank within June. — REUTERS
THE Philippine government has so far raised over $6.508 billion from loans and grants to fund its efforts to control the coronavirus disease 2019 (COVID-19) outbreak and programs to address the economic fallout.
This as the Department of Finance (DoF) on June 5 signed an agreement with the Asian Infrastructure Investment Bank (AIIB) for a $750-million loan. The DoF expects the loan to be fully disbursed within the month.
“The loan package from the AIIB will help augment our funding requirements necessary to mitigate the severe negative impact of COVID-19 on our people and our economy,” Finance Secretary Carlos G. Dominguez III said in a statement released on Tuesday.
The loan is part of AIIB’s share in co-financing the Philippines’ COVID-19 Active Response and Expenditure Support (CARES) program with the Asian Development Bank (ADB).
Data from the DoF showed $5.758 billion was raised from a combination of loans, global bonds and grants as of June 4. Broken down, $5.65 billion in budgetary support financing came from multilateral lenders and the issuance of global bonds, while $108 million was in the form of grants and project loans.
Around 72% or $4.05 billion from budgetary support financing was credited to the National Treasury.
On June 4, the government signed a $400-million loan agreement with the ADB, the proceeds of which will be used to “address key constraints that have limited the growth of domestic capital markets, especially government and corporate bond markets.”
The latest loan brought ADB’s total lending to the Philippines to $2.1 billion so far this year, following the $1.5-billion loan extended for the government’s pandemic response and the $200 million in additional funding for the social protection program.
On June 3, the government inked the deal for the $500-million Emergency COVID-19 Response Development Policy Loan from the World Bank. This was separate from a $500-million loan it obtained from the Washington-based multilateral lender in April.
The World Bank also provided $100 million for the COVID-19 Emergency Response Project early last month, while the ADB extended $8 million worth of grants in March.
In late April, the government sold $2.35 billion in dollar-denominated global bonds: $1.35 billion in 25-year bonds with a coupon of 2.95% and $1 billion via 10-year notes at 2.457%.
DEBT LEVEL
World Bank Senior Economist Rong Qian said the Philippines is “one of the few” countries in the region that have low public external debt.
While a debt-to-gross domestic product (GDP) ratio of 50% is considered a safe level for a borrower, Ms. Qian warned exceeding the debt stock past 60% of GDP could hamper economic growth as a bigger chunk of the budget will be used to repay debt.
“If you borrow above the 60% of GDP, the growth could suffer because eventually you pay more, in terms of repayment and interest rate which would be taxed from the consumer. Fifty percent (of GDP) is still a good safe number, so in principle, the government could borrow more, but subject to their own legislative limitations,” she said in a press briefing on Tuesday.
Amid the coronavirus crisis, the Development Budget Coordination Committee sees the debt-to-GDP ratio to expand to 49.8% this year and to 51.5% by 2021, from a record low of 39.6% in 2019.
Meanwhile, Capital Economics said the Philippines is one of several Asian economies whose debt levels may reach beyond 60% of their GDP in 2020.
“There are a few places, namely the Philippines, Thailand, Vietnam and Malaysia, where the crisis is likely to push national debt above 60% of GDP by the end of the year,” Capital Economics said in a note sent to reporters on Monday.
“A period of austerity will be needed after the crisis is over to bring government debt down to more comfortable levels, dragging on the recoveries.”
Capital Economics said the region showed a bottoming out of activities in April and the continued slump in output despite the gradual lifting of lockdown measures.
“Vietnam, Taiwan and Korea are the only countries where the number of people at work has returned to pre-crisis levels. Elsewhere, the recovery broadly follows the degree to which lockdowns have been eased, which in turn relates to how successfully countries have contained the virus,” it added.
Most areas in the country have transitioned into a modified general community quarantine while Metro Manila and some nearby regions are under general community quarantine, allowing a gradual resumption for some business activities.
However, the country has yet to see a “flattening of the curve.” As of Monday, health officials reported 579 new cases bringing the total to 22,474. The death toll has reached 1,011 while recoveries stood at 4,637.
Capital Economics said that economic recovery is likely going to be gradual.
“We don’t think it will be until the middle of next year that regional GDP regains its pre-crisis level of output and even by the end of 2022 aggregate GDP for the region will still be around 3% lower than it would have been had the crisis not happened,” the report said.
The country’s GDP has dropped by 0.2% in the first quarter which is its first contraction since 1998. Economic managers expect a -2% to -3.2% decline in the economy due to the worsening fallout from the virus. — B.M.LaforgaandL.W.T. Noble
By Norman P. Aquino,Special Reports Editor andArjay L. Balinbin,Reporter
ELNA LEAH L. FONACIER, 64, lost her youngest brother last month to cardiac arrest amid a strict Philippine lockdown — one of the longest in the world — meant to contain a coronavirus pandemic.
She never got to visit him in the hospital while he was battling a chronic illness 34 kilometers away. She neither had the chance to say goodbye nor was she able to visit his family on his wake and during his funeral.
“We felt so sad because nobody could come to his three-day wake except his wife and children who took turns watching his coffin,” Ms. Fonacier said by telephone. “I cried for days inside my room. I felt so helpless because I couldn’t be with him. I also could not go out because I was at risk given my age.”
President Rodrigo R. Duterte locked down the main Philippine island of Luzon in mid-March, suspending work, classes and public transportation to contain a novel coronavirus pandemic that has sickened more than 20,000 and killed about a thousand people in the Philippines.
People should stay home except to buy food and other basic goods, he said. The President extended the so-called enhanced community quarantine twice for the island and thrice for Manila, the capital, and nearby cities where infections have been mostly concentrated.
The lockdown in many parts of the country including Metro Manila has since been relaxed, but mass gatherings remain banned.
Many people have died or grieved alone because of restrictions of the pandemic that has sickened seven million and killed more than 400,000 people worldwide. Heart-wrenching scenes from around the world convey a deep sense of loss as hundreds of thousands of people have died both from the disease known as COVID-19 (coronavirus disease 2019) and other illnesses.
Aggravating the pain and loss is the inability of many people to grieve normally and the powerlessness that their family and friends feel for failing to console them in person.
COMFORT
“Unlike in the West where one could visit the dead in a mortuary at certain hours, in the Philippines the wake plays a vital function in the lives of the dead person’s family,” Nestor T. Castro, an anthropology professor at the University of the Philippines-Diliman said by telephone.
In the past, family members guarded the coffin from shape-shifting evil spirits called aswang in the predominantly Catholic nation, and in modern times the wake provides a platform for relatives and friends to comfort the family of the dead.
“During the wake people come and go, they ask you about what happened, and you tell stories while preparing coffee for them,” Mr. Castro said.
“You become busy and forget about the problem itself. You forget about the pain and the suffering. It’s only when the body is interred that you feel lonely because people are no longer with you at home,” he said. “The coronavirus took that away from us.”
In Spain, which has the fourth-biggest number of infections globally, funeral ceremonies including vigils at home were banned, and relatives allowed to attend burial ceremonies were limited to three as the government struggled with tens of thousands of deaths, according to AFP, the wire agency.
For many immigrant families in France, the coronavirus pandemic has halted the tradition of repatriating bodies to their country of origin, and finding a plot in France has become ever more difficult, the New York Times reported last month.
In India, where a quarter of a million people have been sickened by the COVID-19 virus, the riverbanks of the Ganges River that used to be lined with funeral pyres — giant piles of wood set alight to burn corpses — are now largely empty because of a nationwide lockdown, according to NPR.
And in the United States, where the virus has sickened almost two million people and killed about 112,000, a drive-in funeral theater helped families mourn during a coronavirus shutdown in Texas, the Fort Worth Star-Telegram reported.
‘MORE REAL’
Cremation fees in the Philippines have doubled to P49,000 ($984) during the lockdown, while funeral expenses have shot up especially if they involve someone who died from the coronavirus, said Gemma Grande, a 55-year-old sales agent at death care expert St. Peter Group.
“Apart from the risk of getting infected while our staff handle the bodies, we also have to buy protective equipment while doing the service,” she said in Filipino by telephone, adding that memorial services have been shortened to two days.
Ms. Grande, who received a number of inquiries about their products during the lockdown, said the gloom that the pandemic brought with it seems to have made death more real to some Filipinos, who traditionally avoid the topic especially if it’s about their own.
“Somehow, it made them realize the importance of planning for their death,” she said. “You don’t want to become a burden to your loved ones when you die.”
“I’m not sure how long the so-called new normal will last, because Filipinos have a different concept of time,” Mr. Castro said.
“They live in the present, they respect the immediate past and future, but not the distant past and remote future,” he said. “That’s why we have a tendency to repeat our mistakes. We haven’t learned the lessons from Martial Law, and we haven’t learned the lessons from the 1918 pandemic because they are too distant.”
Filipino traditions and rituals would probably make a comeback next year — whether it’s allowed or not — “because people will most certainly find a way to overcome certain limitations,” the cultural anthropologist said.
So many things remain uncertain at this stage of the global health crisis, and it’s not clear what lasting effects the pandemic may have on the bereaved, whose grieving rites may be crucial to their mental and spiritual health.
Ms. Fonacier and her three remaining siblings managed to virtually attend their brother’s burial through Zoom.
“It was so emotionally painful,” she said. “Mom, who’s 94 and dad, who’s 93 were just like watching TV. They were watching their son get buried because they couldn’t get near him.”
CHELSEA Logistics and Infrastructure Holdings Corp. on Tuesday said it was looking to cut jobs “in phases” in the next six months as a way to cushion the impact of the coronavirus pandemic on its business.
In a phone message to BusinessWorld, Chelsea Logistics President and Chief Executive Officer Chryss Alfonsus V. Damuy said one of the strategies that “the company looks to do in the next six months” is “right-sizing” its workforce. “We will implement it in phases,” he added.
As for the company’s capital expenditures (capex) for 2020, he said: “We are deferring except for those [that are] committed.”
To recall, the group had signed two shipbuilding agreements for the delivery of 98-meter and 123-meter bed/seat roll-on/roll-off passenger ferry ships from Japan. The total contract price for such vessels amounts to approximately P2.35 billion.
The total amount paid as of Dec. 31 last year amounted to P367.3 million, the company said in a disclosure to the stock exchange.
In a news release on Tuesday, the listed company noted that the pandemic has disrupted the momentum it gained in the first two months of 2020 where it showed “significant growth.”
“As a response, the company immediately revisited its future strategies, including strengthening its balance sheet and aggressive fixed asset management by slashing planned capital expenditures and disposing of aging and underperforming vessels,” it said. “To scale up work efficiencies, the group is now undergoing workforce rationalization to restructure support functions and right-size existing workforce,” the company added.
Chelsea Logistics also said it intensified its logistics services during the lockdown period which started in March.
The group said further that it remains keen on its planned airport and port modernization projects in Davao.
“From strengthening its core businesses in the first three years of operation, Chelsea Logistics is now poised to take advantage of the opportunities in sectors with positive and resilient economic outlook, including e-commerce which is seen to grow four times in the next five years and infrastructure projects related to the Government’s Build, Build, Build Program,” it said.
The Dennis A. Uy-led firm’s net loss ballooned by 51% to P832 million last year as the company suffered from its share in the losses of some units and expenses for new vessels and a warehouse complex.
PLDT Inc. on Tuesday said that its revenues had been doing well since April, making it possible that its performance for the first half of the year will surpass last year’s despite the coronavirus crisis.
“Our revenues in the first four weeks of the lockdown — spanning the last half of March and the first half of April —were hardest hit. However, starting the week of Easter Sunday in April, following the balance of April, then May, and onwards to June, we have seen a steady upward march of our revenues, especially in wireless and home broadband,” PLDT Chairman and Chief Executive Officer Manuel V. Pangilinan said during the company’s annual stockholders’ meeting.
He also said revenues in April and May this year are ahead of last year.
“Given this momentum, it is likely that service revenues for the first six months this year will improve over last year’s despite the pandemic,” Mr. Pangilinan said.
PLDT, he noted, also expects that its first half telco core income will rise above last year’s despite the crisis.
“I can assure you that we have steady hands on the tiller, and the ship itself is sturdy. I can add that PLDT is, in fact, emerging stronger from this pandemic,” Mr. Pangilinan said.
Last month, the company announced that it would reduce its capital spending for the year by 24% to P63 billion from the planned P83 billion as movement and travel restrictions under the government-imposed enhanced community quarantine disrupted its network rollout.
The Pangilinan-led company’s first-quarter net income had decreased 12% to P5.91 billion because of losses on its investment in German-based Internet company Rocket Internet and ramped-up investment in its digital arm Voyager Innovations, Inc.
PLDT’s core income was also down 5% to P6.9 billion from P7.2 billion.
Total revenues went up 7% to P43.65 billion, of which service revenues increased 8% to P41.8 billion and non-service revenues inched up 1.25% to P1.85 billion.
Meanwhile, Fitch Ratings said in its report e-mailed to reporters on Tuesday that the leverage profiles of PLDT and its rival Globe Telecom, Inc. are “likely to converge” this year.
Fitch Ratings noted that operating cash flow continues to lag behind investment amid the coronavirus crisis.
“Our projections envisage PLDT’s revenue growing by a low- to mid-single-digit percentage in 2020 (2019: 3%), slightly ahead of Globe’s low-single-digit rate decline (2019: 10% growth),” Fitch Ratings said.
“We consider PLDT’s broader service diversification and entrenched fixed-line position to be advantageous in mitigating revenue pressure in its wireless business, compared with Globe. However, the investments needed to support PLDT’s expansion in mobile revenue and broadband installations are likely to moderate EBITDA growth and delay deleveraging,” it said.
It also noted that the continued travel restrictions “will delay infrastructure network rollout, including new competition from third mobile network operator, Dito Telecommunity Corp.”
On Tuesday, shares in PLDT increased P54 or 4.74% to close at P1,194 apiece.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a stake in BusinessWorld through the Philippine Star Group, which it controls. — Arjay L. Balinbin
AN affiliate company of AC Energy, Inc. has raised its stake in an Australia-listed energy firm, which it is planning to take over.
Listed conglomerate Ayala Corp. told the Philippine Stock Exchange on Tuesday that UAC Energy Holdings Pty. Ltd. relayed its bidder’s statement to shareholders of Infigen Energy Ltd., informing them of its intention to acquire any or all of their stapled securities for an offer price of A$0.80 each.
In a separate disclosure, Infigen apprised the Australia Securities Exchange that UAC has increased its voting interest in the company to 13.4% from 12.82% that it announced on June 3.
“The acquisition of interest in Infigen by UAC strengthens both AC Energy’s and UPC\AC’s commitment to provide low-cost power in Australia by expanding its operating portfolio and enabling the sale of energy through retail channels,” Ayala Corp. said last week.
“Our investment into Infigen reflects our confidence in the prospects for renewable energy in Australia. Investing into an operating renewable energy portfolio helps us meet our corporate and sustainability objectives. We are excited to support Infigen as it continues to expand in this sector,” AC Energy Chairman Fernando Zobel de Ayala said on the move.
The bid, which amounts to around A$777 million of Infigen’s outstanding securities, is subject to approval from the Australian Foreign Investment Review Board and the acceptance of Infigen’s security holders, among others.
Infigen develops, generates, and sells renewable energy. It owns and operates wind farms with a total 670 megawatts capacity in Australia, along with gas, battery, and contracted assets.
UAC is 75% owned by AC Energy Australia Pte. Ltd. The remaining 25% is held by UPC\AC Renewables Australia, a joint venture of the AC Energy group and the UPC Renewables group.
On Tuesday, shares in Ayala Corp. inched up 0.25% to close at P800 each. — Adam J. Ang
LENDING and financing companies that have annual fees due during the enhanced community quarantine are asked to settle their dues with the Securities and Exchange Commission (SEC) starting next week.
In a notice on its website, the SEC said it had resumed physical operations of its Corporate Governance and Finance Department (CGFD) at its Pasay City headquarters since June 1.
Along with this, CGFD-supervised companies such as investment firms, registered issuers of proprietary and non-proprietary shares/timeshares, public companies, financing companies, lending companies, foundations and microfinance NGOS may resume transactions with the physical office of the department.
Annual fees of lending and financing companies that were due starting March 16 until June 15, or the period of the strict lockdown and the weeks that followed, must settle and pay from June 15 to June 28.
For the issuance of payment assessment forms for dues such as filing fees, annual fees and penalties, companies may request and be issued electronic copies of the form by emailing cgfd@sec.gov.ph.
The CGFD office will also start receiving hard copies of information statements, registration statements, tender offer reports, requests for exemption and exemptive relief, and applications for voluntary revocation.
For documents that were previously filed through email such as reports, letters and requests, the SEC said it would require submission of hard copies until June 23 via courier. For new submissions, the hard copies will be entertained after sending an advanced copy through email.
The physical office of CGFD will be open Mondays to Fridays from 8 a.m. to 3 p.m. The easing of quarantine restrictions in Metro Manila has allowed the SEC to gradually open its headquarters, starting with its Company Registration and Monitoring Department in late May.
But even with physical operations, the SEC will still accommodate company registrations and monitoring applications through email to protect its personnel from contracting the coronavirus. It is also implementing a “no face mask, no entry” policy and limiting the number of people in its premises. — Denise A. Valdez
TIMES are hard — the pandemic is not yet over, the entire world has been upended and has entered what the World Bank called the worst recession since the Second World War as it forecast the global economy to shrink by 5.2% this year — but there is still hope for recovery. The recently launched book Asian Founders at Work seeks to encourage recovery through stories of Asian businesses that weathered storms and found success in their industries.
Written by Ezra Ferraz and Gracy Fernandez and published by Apress, Asian Founders at Work features one-on-one interviews with the founders of 20 Asian tech companies on the challenges they faced and what they did right.
Among the companies featured in the book were second-hand online marketplace Carousell, on-demand delivery service Lalamove, streaming platform iflix, and digital wallet system Coins.ph.
“[T]his book is not solely aimed at tech leaders. Whether your business is corporate, small business, or social enterprise, there is always something to be picked up from how the largest tech companies managed to make it big. Growth during the recession may be challenging, but it is achievable with the right knowledge,” said Mr. Ferraz in a press release.
Mr. Ferraz is the managing partner of digital marketing agency Ambidextr while Ms. Fernandez is a contributing writer for Entrepreneur (Asia Pacific) magazine and the digital publication on financial literacy KitaMo.
“Innovation is crucial at a time like this. With the recession drawing near, these stories need to be heard and studied perhaps more than ever before,” said Ms. Fernandez in the release.
In an excerpt sent to BusinessWorld, the authors interviewed Ron Hose, who co-founded Coins.ph with Runar Petursson. The chapter covers the company’s beginnings in 2014 and its subsequent acquisition by Jakarta-based ride-hailing platform GoJek in 2019 in a deal valued at $95 million.
Done in a question-and-answer format, Mr. Hose said they chose the Philippines as the site of Coins.ph because “it has a large market domestically… and a fast-growing economy,” but admitted they faced challenges like low internet penetration which is crucial for a digital payment system.
“For me, this irregular lack of infrastructure is a sign of opportunity… [and] people here are tech-savvy, but at the same time, there are a lot of improvements that can be made for everyday life with technology,” Mr. Hose explained.
The chapter on Mr. Hose and Coins.ph covers 11 pages and it discusses everything from Mr. Hose’s thoughts on the cryptocurrency Bitcoin (“in 2013, a lot of people were really looking at it as a speculative instrument… I was not excited by that because I was looking to create long-term value through the business”) and why Coins.ph was started (“this came about because we saw that 80% of Filipinos don’t have access to financial services… [and] traditional banking models just do not work well for emerging markets”).
Mr. Hose also noted that his previous company, live video platform TokBox, which he started in 2007 taught him about the “economic cycles of markets” as the company was able to raise funds just before the stock market crash of 2008.
“With this, I learned the importance of being conservative when everyone is bullish, and to know how to keep things in check when things go up and down,” he said.
Asian Founders at Work is available on Amazon at $17.42 for the Kindle version and $18.64 for paperback. — ZBC
ALLHOME Corp. is planning to open a new branch in Isabela in the third quarter as it boosts its presence across the country.
In a statement Tuesday, the Villar-led retailer of home improvement products said it is continuing to work on increasing its store network from 45 stores at present.
“We have a solid pipeline of new stores around the country and have the ability to fast track construction of those stores given our affiliation with the Villar Group’s commercial and residential companies,” AllHome President Benjamarie Therese N. Serrano said in the statement.
The company has set opening a new branch in Santiago, Isabela within the third quarter. This would be the latest addition after the four stores AllHome opened in Gapan, Nueva Ecija; San Ildefonso, Bulacan; Ampayon, Butuan; and Koronadal City, South Cotabato.
Currently, the company’s 45-store network is distributed in Mega Manila (35 stores), other areas in Luzon (5), and Visayas and Mindanao (5). When it did its public offer in October last year, AllHome said its target was to have 70 stores by the end of 2020.
“We are confident with the pipeline of AllHome especially with the easing of community restrictions. AllHome’s strength of being close to residential communities makes it a go-to place during quarantine periods and even after the community quarantine,” AllHome Vice-Chairman Camille A. Villar said in the statement.
The company said it caters not only to homeowners of Villar-led properties, but also interior designers, architects and contractors as its portfolio of products range from construction materials, hardware, tiles and sanitary wares, furniture, appliances, homewares and linens.
“Consumers now deem it important to shop closer to home and in a space that’s not overly crowded for their own safety. Being a home essential provider, AllHome will continue to provide service to those who are fixing their own homes or contractors who have resumed construction activities,” Ms. Villar said.
AllHome’s net income grew 30% to P270.22 million in the first quarter due to putting up additional stores in 2019. These new revenue streams, amounting to 22 new stores to be exact, lifted the company’s topline by 41% to P3.37 billion.
Shares in AllHome at the stock exchange gained 60 centavos or 8.11% to close at P8 each on Tuesday. — Denise A. Valdez
SINCE Italy went on lockdown due to COVID-19 (coronavirus disease 2019) outbreak early in March, Filpino artist Stephanie Honrado’s classes at the Angel Academy of Art have been postponed. But throughout the lockdown, she continued to paint in the classic style in her apartment in Florence.
On June 6, Ms. Honrado took a quick break from her routine for a Zoom conference with the press back home to share the stories of 12 artworks — mostly still lifes and nudes — featured in her exhibition titled Come stai? (How are you?). She also brought everyone on a quick digital tour around the 13th century Palazzo San Niccolo where she created one of the pieces.
Come stai? (How are you?) is Salcedo Auctions’ second virtual exhibition.
WHY FLORENCE AND CLASSICAL ART?
Ms. Honrado was first exposed to Florence’s classical art when she visited in 2010. In 2019, she traded her career in finance for the paintbrush.
“It’s not easy but it can be done. It can break your spirit if you’re not set. I still grapple with that every day,” Ms. Honrado said, acknowledging that you have to prepare for your financial needs. “You really have to be brave. It will be a test of your spirit. But you can do it.”
“I don’t want to be 80 years old and thinking, ‘I had a chance when I was 50 [years old] and I did not take it,’” she added.
When it came to her fascination with classical art, Ms. Honrado noted her admiration for Virgin and Child paintings by Italian Renaissance painter Antonio da Correggio.
Knowledge of classical art is foundational she noted. “The classical method has attracted me for a long time already because I like the structure that it gives, and its history,” she said. “Having these tools is a good way to have flexibility.”
THE ARTWORKS
One of her works, Faith (2018), is a still life of a feather. Discussing the work, she noted that ever since she moved to Florence to pursue her art studies, she kept seeing feathers on the street. “I was getting curious so I did a bit of research. Apparently, they (feathers) are signs of divine presence, of protection, and guidance. Every time you see one, it’s a sign that something good is nearby,” she said.
Come stai? (2018) is another still life, this time of two bulbs of garlic whose stems are intertwined — she likens them to two affectionate people. “[They were] twirling as if all they ever say is ‘Come stai?’. For me, I thought, it is such a meaningful word, at least for the people who are unable to find words for their feelings, come stai is meaningful that way because it expresses care, affection, and love,” she explained.
Invincible Summer (2020), a still life of a stuffed bunny on a floral shawl, is, the artist said, a representation of strength. Ms. Honrado said she was inspired by a quote by French philosopher Albert Camus: “In the midst of winter, I found there was, within me, an invincible summer.” She represents her “invincible summer” through the portrait of her stuffed toy, her companion during the lockdown. “I held on to her. She was my companion. So, I thought I’d paint a portrait of her.”
Also included in the exhibit are the nudes Alessandro and Sofia which she did during live figure drawing classes. Ms. Honrado recalled her teachers’ rigorous reminder to “turn the form,” during the classes.
“It means that the strokes are not soft enough to convince the eye that the form is turning — that [the] muscle is turning this way or [the other],” she explained. “It’s part of the exercise to help [you] draw things as though they are 3-D. Drawing is the backbone of good painting.”
Alongside the physical and virtual exhibition, other works by Ms. Honrado will be uploaded in the coming weeks on the Come stai? (How are you?) social media series. Videos and photos of the artist’s favorite Florentine art, accompanied by personal anecdotes, will be featured on Gavel&Block’s social media channels.
Despite the uncertainty in these difficult times, Ms. Honrado continues to be creative as she anticipates resuming classes in September. “[I just] paint, paint, and paint every day.”
Come Stai? (How are You?) is on view online on https://salcedoauctions.com/auction/129 until July 6.
Salcedo Auctions, located at the NEX Tower, Ayala Ave. in Makati City, is now open to walk-in guests on weekdays from 9 a.m. to 5 p.m., and on Saturdays from 9 a.m. to 4 p.m. Guests are advised to observe social distancing while at the gallery. For inquiries, e-mail info@salcedoauctions.com or contact 0917-825-7449, or 0917-107-5581. Follow @gavelandblock on Facebook and Instagram. — Michelle Anne P. Soliman
