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Digital service tax could generate P29B in revenues

IMPOSING taxes on digital services may raise about P29 billion in annual revenues for the government, a congressman said on Tuesday.

House Ways and Means Committee Chairperson Albay Rep. Jose Maria Clemente S. Salceda filed House Bill No. 6765 or the “Digital Economy Taxation Act,” which seeks to impose a 12% value-added tax (VAT) on digital advertisements, internet-based subscriptions and transactions made on electronic commerce (e-commerce) platforms.

“No new taxes here, we just want them to pay their fair share. Assuming you’re a company that sets up in the Philippines, and you do video-streaming or music-streaming services, you will definitely pay taxes. But companies like Netflix and Spotify don’t. That’s obviously not fair,” Mr. Salceda said in a statement on Tuesday.

“When you’re a network in the Philippines, advertising services paid to you will be subject to VAT (value-added tax). But Google and Facebook are not subject to VAT for advertising. Ang laki po ng kinikita nila sa mga Pilipino, pero ni isang kusing ng VAT, wala (They earn so much from the Filipino people, but they don’t pay a centavo of VAT), ” he added.

Finance Secretary Carlos G. Dominguez III said taxing the digital economy is “something to seriously consider” to plug leakages.

“It’s to be able to collect VAT,” Mr. Dominguez told reporters via Viber on Tuesday.

Bureau of Internal Revenue (BIR) Deputy Commissioner for Operations Arnel S.D. Guballa said it is “about time” for the Philippines to capture these tax leakages on digital transactions.

“Every sale of goods or services are taxable, whether manual or digital. On digital transactions, [it’s] about time to be high-tech to capture [leakages],” Mr. Guballa said in a text message.

Mr. Salceda’s bill will make “network orchestrators like Grab Philippines, Angkas, and other similar services that link customers and providers as withholding agents for income taxes,” in order to boost tax compliance. Also included are “network orchestrators” for leasing services such as Airbnb and e-commerce platforms such as Lazada and Shopee.

Under the bill, VAT will be imposed on all services “rendered electronically,” which includes digital advertising on Google and Facebook and subscription services such as Spotify and Netflix.

“This will, once and for all, set a statutory clarification of a long-standing question of whether services rendered electronically can be subjected to VAT,” Mr. Salceda said in the bill’s explanatory note.

The measure will also require digital service providers to establish a resident agent or representative office in the Philippines.

“This addresses the issue of businesses having a significant presence in a country without having a physical establishment here that could be held liable for tax and regulatory purposes, improving our revenue intake while being better able to protect consumers from unfair trade practices,” Mr. Salceda said.

Using “conservative” figures, Mr. Salceda estimated the measure will generate P29.1 billion in annual revenues for the government. About P9.7 billion will come from e-commerce platforms that will serve as withholding agents for VAT.

VAT on digital advertising is expected to generate P4 billion, while other digital services such as games will generate P2.9 billion. VAT on subscription-based services such as music streaming and video streaming services will yield about P2.2 billion.

Corporate income tax on digital service providers is also expected to raise P5.7 billion.

“The bill responds to the increased urgency of finding new sources of revenue to fund the country’s efforts to recover from the adverse impact of COVID-19, and anticipates the increasing digitization of the country’s economy,” Mr. Salceda said.

Earlier this month, the Finance department submitted a draft proposal on a “digital economy VAT” to lawmakers, which it said would generate P15 billion in revenues in 2021, P16.6 billion in 2022 and P18.4 billion in 2023. — Genshen L. Espedido and Beatrice M. Laforga

DTI studies import duty

THE Department of Trade and Industry (DTI) is studying tariff measures on imported products to boost state coffers.

“We are considering, maybe, but that’s still being studied right now. If at all, it would be a minimal tariff just to raise funds,” Trade Secretary Ramon M. Lopez said in a television interview on Tuesday.

“It’s not for protectionism. It is simply to raise some revenues for the government.”

In a mobile phone message sent to reporters, Mr. Lopez said he had asked his team to survey costs among suppliers abroad and local manufacturers. In principle, he said all products being studied for this measure will be solely for revenue generation. He did not identify the goods being considered.

He said in the ABS-CBN News Channel interview that locally produced products will continue to be prioritized for the government’s massive infrastructure program “Build, Build, Build.”

“It will become some kind of a guideline that will enjoin the contractors, those who won the contract dun sa (at the) Build, Build, Build, to prioritize ’yung (the) locally made products or inputs. This is really to stimulate demand.”

“Minsan, you don’t have to give a subsidy or government in-cash support, kailangan lang give them the demand, the market for their products, and buhay na sila. Lalakas na ulit ’yung negosyo and local employment (Sometimes you don’t have to give subsidies or cash support from the government, you just give them demand, the market for their products, and they will survive. Their business and local employment will be strong),” he added.

President Rodrigo R. Duterte on May 2 temporarily raised tariffs on imported crude oil and refined petroleum products to raise revenues for coronavirus disease 2019 (COVID-19) relief measures.

The Energy department estimated the government could raise up to P6.78 billion in revenues from the increased import duty this year.

The Trade department had considered safeguard duties on imported cars to protect local assemblers after Honda Cars Philippines, Inc. shut down its Laguna facility in March. — Jenina P. Ibañez

Remittances likely to contract by 7% this year

REMITTANCES may shrink by 7% this year, says Nomura Global Markets Research.

“We think the outlook for remittances is grim and the contraction could deepen ahead. We forecast 2020 remittances growth dropping to -7%,” it said in a note sent to reporters on Tuesday.

While remittances are usually resilient amid global downturns, Nomura Global said “this time is different given the confluence of factors” amid the coronavirus crisis.

Nomura Global noted that overseas Filipino workers (OFWs) from different sectors and countries are now being affected by the pandemic.

“First, sea-based remittances (22% of the total) will take a big hit particularly from the cruise ship sector,” according to the report.

Bangko Sentral Pilipinas (BSP)data showed that cash remittances from sea-based OFWs reached $6.539 billion out of the $30.133 billion total remittances in 2019.

“Second, just like during the SARS epidemic in 2003, deployment to key host countries should slow, and arguably the situation today is much larger in scale.

Another factor affecting remittances is the decline in oil prices, which has hurt Middle East countries.

Cash remittances from countries in the Middle East dropped by 9.7% to $5.972 billion in 2019, from $6.617 billion in 2018.

Previously, Nomura Global said the Philippines was likely to suffer the most during the crisis among other remittance markets. It noted that remittance inflows accounted for 9.9% of the country’s GDP in 2019.

Data from the central bank showed cash remittances of overseas Filipinos coursed through banks stood at $2.358 billion in February, up 2.5% from $2.301 billion a year ago. However, the annual growth rate in February was much slower than the 6.6% year-on-year expansion in January.

“The BSP staff projects that the OFW remittances would shrink by 0.2 to 0.8% from the original 3% growth forecast, hence the revised forecast is a range of 2.2 to 2.8% or a midpoint of 2.5%,” BSP Governor Benjamin E. Diokno said on Friday. “To be on the conservative side, BSP adopted an amended forecast of 2%, which is less than 2.5%.” — Luz Wendy T. Noble

Meralco says billings complied with rules

By Adam J. Ang

PRESSED with mounting complaints about the apparent surge in its present electricity charges, Manila Electric Co. (Meralco) said it has “strictly” followed government regulations on computing its customers’ bills.

Senator Sherwin T. Gatchalian on Monday reminded the distribution utility giant of its mandate to follow the advisories sent out by the Energy Regulatory Commission (ERC) for the computation of customers’ electricity bills incurred during the enhanced community quarantine (ECQ) from March to May, as well as the prescribed due dates.

Responding to this, Meralco Vice President and Utility Economics Head Lawrence S. Fernandez said: “Meralco strictly complied with ERC Advisories and relevant regulations.”

Sen. Gatchalian said the complaints arose from Meralco’s “confusing” electricity bill. “Meralco has failed to provide Filipinos a clearer and justified explanation on why bills have gone up so high,” he added.

But Meralco already issued its explanation on customers’ bill shock last week, saying that the May bill is the result of the actual electricity consumption in kilowatt-hours (kWh) from the current meter reading, plus the estimated consumption reflected in the deferred April and March bills.

“This total, which is already based on the true and actual readings, is what customers actually see in the May bill. That is why you may notice a rise in the total amount due,” the company said.

The ERC has ordered power utilities to provide a staggered payment scheme to their customers for paying their deferred bills since March. These can be paid in four installments in the next four billing months after the ECQ, along with the payment of their current bills.

The commission on May 5 also ordered the distribution utilities and electric cooperatives to further extend the grace period that they earlier provided to consumers in areas under ECQ.

Should there be an overestimation in a customer’s bill for this month, the customer can choose which billing month it would want the overpaid amount to be later credited, Meralco Senior Vice President and Legal Head William S. Pamintuan said.

“Any overpayment made by a customer will be immediately refunded or credited to his succeeding months consumption at the customer’s option,” he said in a Viber message.

“Our bill also clearly provided that customers can pay their March and April rendered bills during the ECQ in 4 monthly installments as provided in the ERC Advisories,” he added.

On top of bills complaints, Meralco has also received the Department of Energy’s (DoE) letter asking the company to explain the additional P47 fee that customers have to pay while settling their dues through its own mobile app.

“Meralco is supposed to obtain authority from the government to do something like this. Apparently, your offices are justifying that you do not need to go through the Government because this fee collection does not go to Meralco — that it goes to your app service provider,” the letter dated May 14 read.

The DoE said the transaction fee raises the electricity cost for consumers, “a clear deviation to all the government efforts to bring down the cost of utilities, especially during these difficult times.”

But Mr. Pamintuan said the online fees are charged by online payment services provider to those using their platforms to pay their bills and are not remitted to the company.

“These online fees are not Meralco’s fees but are the fees charged by online payment services provider to those using their platform or system to transact online payments for their convenience,” he said.

Meralco has yet to submit its reply to the DoE, Mr. Fernandez said.

The ERC on Monday ordered the distribution utility to explain its basis of its determination of the kilowatt-hour consumption of its customers during the ECQ.

Moreover, it is also seeking the company’s power bills from suppliers which were reflected in its computation of generation rate, as well as its invoices from the National Grid Corporation of the Philippines (NGCP) for the computation of its transmission rate and its uniform reportorial requirement for the billing periods.

This coming Friday, the complaints on alleged increases in Meralco electricity bills will also be the subject of the Joint Congressional Energy Commission hearing on the impact of the coronavirus disease 2019 (COVID-19) pandemic in the Philippine power sector.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls.

House bloc seeks probe of electricity bills

A RESOLUTION calling for an investigation on the sudden spike in Manila Electric Co. (Meralco) electricity charges has been filed in the House of Representatives.

“Several media reports quoted electric consumers complaining about their Meralco bills that have tripled, for some, even quadrupled, despite their present low consumption, as well as in previous months,” the Makabayan bloc said in House Resolution 879 filed on Monday.

“Such high and unconscionable electric bills, only added more anxiety to many, especially now when most people are in dire straits to survive the harsh effects of the crisis brought about by the COVID-19 pandemic,” it added.

The resolution cited a P0.105 per kilowatt-hour (kWh) increase to P8.995 from P8.890 for the month of April, equivalent to a P21 increase in the total bill of “typical” residential consumers who consume an average of 200 kWh.

“The recent Meralco justification that the surge in electricity bills of consumers is a result of higher consumption, is questionable especially since President [Rodrigo R.] Duterte reported a downward trend in demand during the lockdown period,” Bayan Muna Party-List Rep. Carlos Isagani T. Zarate said in a statement on Monday.

Mr. Zarate cited the President’s report to Congress on May 11, saying that “major island grids exhibited excess capacity over peak demand with Luzon at 23% [2,683 MW (megawatts)], Visayas 28% [718 MW] and Mindanao at 30%.”

“So how can consumption increase when the demand is going down as we enter the summer period?” Mr. Zarate asked.

The Energy Regulatory Commission (ERC) on Monday ordered Meralco to explain its calculation for its past customers’ monthly billings from March to May.

In a statement last week, Meralco addressed customers’ bill shock, saying that the May bill is the result of the actual electricity consumption in kWh from the current meter reading, plus the estimated consumption reflected in the deferred April and March bills.

The apparent spike in electricity rates was due to various factors, including the increase in power consumption during the lockdown and the high May temperature, which led to higher use of cooling appliances at home, Meralco said. — Genshen L. Espedido

IMI, UK subsidiary introducing COVID-19 ventilators

AYALA-LED Integrated Micro-Electronics, Inc. (IMI) is looking to locally manufacture a ventilator system designed by its United Kingdom-based subsidiary for use by coronavirus disease 2019 (COVID-19) patients.

The listed electronics manufacturer said its subsidiary Surface Technology International Ltd. (STI) is exploring a non-invasive alternative ventilator that uses the Ventura Continuous Positive Airway Pressure (CPAP) device solution.

CPAP is a type of ventilator that uses mild air pressure to help COVID-19 patients that are experiencing difficulty breathing. IMI said its proposed solution is a “non-profit initiative based on an existing off-patent CPAP system that has been further modified to optimize oxygen consumption.”

“IMI is studying the possibility of locally manufacturing the system, in collaboration with the Institute of Biomedical Engineering and Health Technologies (IBEHT) of De La Salle University,” the company said in a statement on Tuesday.

IMI and STI are working with medical experts, health practitioners and concerned government agencies through information-sharing sessions on how to use the Ventura CPAP system.

The Ventura CPAP system has already been approved by the Medicines and Healthcare Products Regulatory Agency for use in the United Kingdom. The design is licensed from the University College London Hospital (UCLH) and Mercedes-AMG High Performance Powertrains under special conditions particularly for use in COVID-19 cases.

IMI said UCLH has found 60-70% success in sustaining COVID-19 patients using the Ventura CPAP system.

STI is a member of the United Kingdom consortium, VentilatorChallengeUK, which produces medical ventilators used by COVID-19 patients. It specializes in manufacturing tools used in aerospace, defense and security, as well as energy, healthcare and industrials.

IMI booked a net loss of $4.62 million in the first quarter, bigger than the $335,000 posted last year, due to an industry-wide slowdown caused by the COVID-19 pandemic. Its shares at the stock exchange gained 26 centavos or 5% to close at P5.46 each on Tuesday. — Denise A. Valdez

VLF 2020: Giving a voice to the Lumad community

A YOUNG student named Patrick got into trouble at his new school. Scared that he might face a sanction, he hides inside a dilapidated storage room. Titser Kit finds him there and helps him with the situation he is facing.

Jobert Landeza’s Titser Kit is part of this year’s lineup of one-act plays featured in the 16th edition of Virgin Labfest titled VLF 2020 KAPIT: Lab in the Time of Covid (A Virtual Labfest Lockdown Edition).

Mr. Landeza was inspired by the story of a young boy of the Lumad community during one of his visits at the Bakwit (a colloquial term for “evacuee”) School for Lumad children at the University of the Philippines, Diliman late last year.

“Nakausap ko yung mga bakwit students doon. Pag-uwi ko ng Bicol, baon ko yung kwento [dahil] haunting siya sa pakiramdam. Sa murang edad, may mga kwento silang kakaiba, and at the same time, disturbing para sa atin (I talked to bakwit students there. When I returned home to Bicol, I carried their haunting stories with me. At a young age, they had unique stories [which are], at the same time, disturbing for us,” Mr. Landeza told BusinessWorld in a Zoom interview on May 11.

In October 2019, all 55 Lumad schools operated by the Salugpongan Ta’Tanu Igkanogon Community Learning Center, Inc. (STTICLCI) were ordered to shut down by the Department of Education in Davao.

Since they were taught to read, write, and count, Lumads have been accused of being members of the New People’s Army (NPA).

Lumad IPs continue to be forcibly evacuated from their residences due to conflict and military operations in their communities.

Mr. Landeza hopes that his play helps widen the discourse on the issue of the closure of Lumad schools in Mindanao and the Lumad students’ right to education.

“Kailangan marinig ng mga tao [ang istorya], especially those in the city, para maintindihan nila ang pinaglalaban ng mga Lumad at kung bakit nandito sila [in Manila] (The people need to hear the story, especially those in the city, so that they understand what the Lumad community is fighting for and why they are here [in Manila],” Mr. Landeza said.

FIRST-HAND LESSONS FROM THE COMMUNITY
The production team was scheduled to interview students at the Bakwit School for Lumad children at the University of the Philippines, Diliman when the enhanced community quarantine (ECQ) was imposed in Metro Manila.

However, they kept in touch with Rius Valle, spokesperson of Save Our Schools Network, a network of child-focused NGOs and church-based groups that advocate for children’s right to education. Mr. Valle, who is working closely with the Bawkit School in UP, Diliman, served as the play’s production consultant.

“When we presented the script to him, nagbalik siya ng (he returned) pages of notes. Maraming nabasag na Manila-centric [ideas] sa pagkakasulat ng play (There were many Manila-centric ideas which were broken in the writing of the play),” said first-time VLF director Adrienne Vergara who was previously a VLF actor and stage manager. She added that Mr. Valle’s notes helped in clearing assumptions and judgements on Lumad culture and values.

“Sana sa pamamagitan ng Titser Kit, may makapanood at may makatulong sa sitwasyon nila (Through Titser Kit, we hope that there are those who get to watch and help their situation),” Mr. Landeza said. “Misyon din ng grupo na makakuha ng suporta hindi lang sa Bakwit School sa UP, kundi sa mga bakwit school sa buong bansa na lumalaban para sa edukasyon para sa ating mga kapatid na Lumad (It is also the group’s mission to gain support not only for the Bakwit School in UP, but also for bakwit schools around the country who fight for the right to education of our brother Lumads).”

“[I think] sa buong history ng VLF, ngayon lang nakapagsulat ng kwento about the Lumads.” Ms. Vergara said. “Kailangan mas maraming makarinig.” (I think that in the whole history of the VLF, this is the first time that a story about the Lumads was written. More people have to hear it.)

The one-act play, like all of the plays in this year’s edition of the Virgin Labfest, will be live-streamed online thanks to the restrictions on live performances due to the online COVID-19 pandemic.

The play features JM Salvado as Patrick, while Io Balanon takes the role of Titser Kit.

The production team is made up of Joyce Garcia (video/animation), TJ Ramos (sound design), with additional original music by Roldan Lozano and the Lumad Bakwit School, Roman Cruz (lighting design), Wika Nadera (poster design); and Rio Tanchuling (stage manager). Lumad Bakwit School students Katkat and Mech are the Obu Manuvu translators.

Titser Kit will stream live on June 11, 3 p.m., and June 27, 2 p.m..

Aside from the revisited plays and staged readings, viewers can also catch the VLF Playwright’s Fair online with this year’s playwrights on June 11-14, 17-20, 25-27 at 8 p.m. Meanwhile, the Virgin Labfest 2020 Writing Fellowship Program will culminate in an online staged reading of the fellows’ works on June 28 at 2 and 5 p.m.

For more details and show schedules, visit https://www.facebook.com/culturalcenterofthephilippines/ and https://www.facebook.com/thevirginlabfest/. — Michelle Anne P. Soliman

NTC told to comment on ABS-CBN injunction suit

By Vann Marlo M. Villegas, Reporter

THE Supreme Court has not yet ruled on the petition of ABS-CBN Corp. for a temporary restraining order against the cease-and-desist order of the National Telecommunications Commission (NTC) against the network, forcing it to stop airing after its legislative franchise expired.

The court ordered the telecommunications regulator to comment on the petition of ABS-CBN for TRO and or preliminary injunction against its order in 10 days upon receipt of notice, SC Public Information Office Chief Brian Keith F. Hosaka said.

The SC also impleaded the Senate and the House of Representatives as parties to the case, requiring them to comment as well within 10 days.

“The Respondent NTC was also required to file a reply within a non-extendible period of 5 calendar days from personal notice of the said comments of the Senate and House of Representatives,” Mr. Hosaka told reporters in a Viber message.

ABS-CBN on Monday urged the court to immediately act on its petition filed on May 7, noting that it will take weeks or months before the Congress passes the measure of the lower house to grant it provisional authority to operate until October 2020.

The network also reiterated that the prolonged shutdown would affect the livelihood of its 11,000 employees and would mean less tax for the government as it has paid between P70.5 billion between 2003 and 2020.

ABS-CBN said in its petition that it would lose up to P35 million daily when it is off-air.

Mr. Hosaka said the court also denied the petition of lawyer Lorenzo G. Gadon to have his case consolidated after he asked the court to stop the NTC from issuing a provisional authority to ABS-CBN after its franchise expired.

The NTC issued the order on May 5 after the franchise of ABS-CBN , which renewal is pending before the Congress, expired on May 4.

This is contradictory to what the commission said before a Senate hearing in March that it would issue the provisional authority when the franchise expires.

Justice Secretary Menardo I. Guevarra said in March that the Congress may pass a concurrent resolution authorizing NTC to issue the provisional authority pending the franchise renewal of ABS-CBN.

The House of Representatives sent a letter to the NTC while the Senate passed a resolution asking the commission to allow ABS-CBN to operate through the issuance of the authority.

NO MEDDLING
Meanwhile, the Office of the Solicitor General (OSG) said it did not meddle with the Congress’ actions on the franchise of ABS-CBN when it advised the NTC in April not to grant the company a provisional authority.

It said that it was not opposing the Congress when it advised the NTC of its possible encroachment on legislative power if it issues the provisional authority without a law allowing it.

“Warning or cautioning a client is not threatening,” it said. “He (Solicitor General Jose C. Calida) never mentioned the name of Speaker Cayetano and any congressman in his advisory letter to NTC and subsequent press release.”

It also said that the letter it sent to the NTC on May 3 “merely formalized the legal advice verbally given to NTC officials before that date regarding the expiration of the media firm’s franchise.”

“Actually, the Solicitor General acted with circumspection because voicing out his concerns to Congress without being requested by it would have constituted meddling in its affairs, apart from the fact that the issues he is raising are sub judice,” it said, noting that the OSG filed a quo warranto petition to the SC for cancellation of ABS-CBN and its unit ABS-CBN Convergence, Inc.’s legislative franchises.

The OSG also said that it is the statutory counsel of NTC which belongs to the executive branch and there is no rule to notify a different branch of government of an internal communication.

It also said that it agrees with House Speaker Alan Peter S. Cayetano that alleged violations of ABS-CBN should be investigated.

The solicitor general also declined to attend the Senate hearing on May 19 because of the pending quo warranto petition before the Supreme Court.

In the quo warranto petition filed in February, the OSG cited the alleged “highly abusive practices” of ABS-CBN, citing the operation of a pay-per-view channel without NTC approval, and violation of foreign ownership restrictions, among others.

BSP chief sees no need to tap IMF facility amid crisis

THE PHILIPPINES does not need to tap International Monetary Fund’s (IMF) credit line for economies affected by the pandemic, Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said, citing the country’s sound economic management which put it at a “position of strength” before the coronavirus disease 2019 (COVID-19) hit.

“BSP sees no apparent and immediate need to avail of IMF’s short-term liquidity line (SLL)… Structural reforms have helped the Philippines enter the COVID-19 crisis from a position of strength,” Mr. Diokno told reporters in a Viber message on Monday.

The SLL was rolled out by the IMF in April as an on demand financing tool to help economies avoid longer-lasting solvency problems as they face the pandemic.

“It is designed to be a liquidity backstop for members with very strong policy frameworks and fundamentals, who face potential, moderate, short-term liquidity needs because of external shocks that generate BoP (balance of payments) difficulties,” Mr. Diokno said.

IMF Resident Representative to the Philippines Yongzheng Yang said there is no deadline for the availment of the SLL.

“There is no deadline. It is not just for this crisis. The repurchase (repayment) period is one year,” Mr. Yang said in an e-mail, noting that the country is eligible to apply for assistance under the facility.

The Philippines has been under lender status with the IMF since 2011.

Mr. Diokno noted that the country is armed with strong macroeconomic fundamentals, such as a seven-year high BoP surplus of $7.84 billion as of end-December, a resilient currency, ample dollar reserves, as well as a manageable debt-to-gross domestic product (GDP) ratio.

“The peso has outperformed most of its peers in the region…and is second to the Taiwanese dollar which is the only currency that appreciated versus the dollar,” he said.

Gross international reserves as of end-March stood at an all-time high of $88.99 billion, enough to cover 7.9 months of imports, BSP data showed.

The Philippines also posted a record low debt-to-GDP ratio of 39.6% last year.

Security Bank Corp. Chief Economist Robert Dan J. Roces said Mr. Diokno’s stand to not tap the IMF facility is an assurance that the country is in a position of strength.

“Strong economic fundamentals essentially mean the absence of a solvency problem in the longer term,” Mr. Roces said in an e-mail.

“Thus, the option to dispense with the SLL because the BSP sees no short-term liquidity problem that can become a deeper and longer-lasting solvency problem. This validates the position of strength for our economy,” he added.

But despite the ample buffers of the economy against the coronavirus crisis, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion is of the view that tapping the facility will mean no harm for the country.

“The purpose of the special line, I believe, is perfect for the Philippines of today. If needed, I do not think using the credit line is going to be a problem,” Mr. Asuncion said in a text message, noting that the financial strength of the country is at its “best ever” right now.

So far, loans secured by the country for its COVID-19 response include totalled $600 million from the World Bank and $1.5 billion from the Asian Development Bank. — Luz Wendy T. Noble

Mask in a restaurant? This one can gobble like Pac-Man

OR YEHUDA, Israel — Israeli inventors have developed a coronavirus mask with a remote control mouth that lets diners eat food without taking it off, a device they say could make a visit to a restaurant less risky.

A squeeze of a lever, much like a cyclist operates a handbrake, opens a slot in the front of the mask so that food can pass through.

The process could get messy with ice cream or sauces, but more solid morsels can be gobbled up in a flash a la Pac-Man in the arcade game.

“The mask will be opened mechanically by hand remote or automatically when the fork is coming to the mask,” Asaf Gitelis, vice-president of Avtipus Patents and Inventions, said on Monday as he demonstrated the device at its offices near Tel Aviv.

“Then you can eat, enjoy, drink and you take out the fork and it will be closed, and you’re protected against the virus and other people sitting with you.”

The company said it plans to start manufacturing the mask within months and had already submitted a patent. It said it would likely sell at a 3 to 10 shekel ($0.85 to $2.85) premium above the price of the simple pale blue medical masks many Israelis wear.

Outside a Juice Bar in Tel Aviv, Reuters showed customers a cellphone video of the mask in action. Opinion was divided.

“I think this mask, that enables me to eat while I’m still wearing it, is a must-have,” said Ofir Hameiri, a 32-year-old graduate student.

But eating an ice cream cone, Ron Silberstein, a 29-year-old musician, said: “I don’t think this mask could hold this kind of ice cream — it’s dripping all over. I wouldn’t want to wear it afterward.”

Israel has largely reopened its economy after a dramatic drop in cases of the novel coronavirus. Restaurants are open only for takeout for the time being. — Reuters

Network warns of job losses by August

ABS-CBN Corp. employees are at risk of retrenchment by August if the Congress fails to grant a franchise that will allow the network to resume operations, the top official of the network said on Tuesday.

“When we were taken off air on May 5th, we made a commitment to our employees given the difficult economic situation following COVID-19 (coronavirus disease 2019), we made a commitment to them that we would not take away jobs for three months,” ABS-CBN President and Chief Executive Officer Carlo L. Katigbak said in a hearing, Tuesday.

But he said the network continues to incur losses after its May 5 shutdown, which may force it to eventually consider laying off its workers.

“We continue to lose a substantial amount of money every month and I’m afraid that if we cannot get back on air soon by August, we may already have to consider beginning a retrenchment process,” he said.

Mr. Katigbak was speaking before the Senate Committee on Public Services, which is tackling measures that will grant the network a 25-year franchise renewal and two other bills providing a provisional franchise until December 2020 and June 2022.

The hearing was conducted while the Senate awaits the transmittal of House Bill No. 6732, which in its last version grants ABS-CBN a provisional franchise until October.

“At this point in time our primary concern is to try and get back on air as quickly as possible. We leave it to Congress jointly to decide what’s the best way for us to legally return to the air,” Mr. Katigbak also said.

“It is critical from a financial stand point and from an employee welfare standpoint that we return, that we go back on air,” he added.

Former senate president Juan Ponce Enrile questioned the urgency in deliberating the ABS-CBN franchise as he is under the impression that there are enough radio stations in the country to report updates on the pandemic.

“The nooks and corners of this republic is rich, not by television but because of radio,” he said.

He also recommended that the Congress grant the National Telecommunications Commission the power to extend franchises, instead of granting a short-term franchise to the network.

Senator Risa N. Hontiveros-Baraquel pointed out the urgency is in securing the employment of network’s workers, in light also of the crisis brought by the pandemic. Senator Juan Miguel F. Zubiri was concerned about the risk of ABS-CBN potentially losing its frequency.

“Coming up with a franchise renewal is a very difficult process already, a more difficult process is accessing frequency and that is why there is free tv frequency allotted these companies, if they lose the frequency they will start from scratch,” Mr. Zubiri said.

The chamber also established the constitutionality of the procedure after Senator Francis N. Tolentino raised it might be questioned by the Supreme Court, considering the House of Representatives has yet to transmit its version.

Senator Franklin M. Drilon, in response, said it has long been a practice to hold simultaneous hearings on measures that should emanate from the House.

“The rule is we can conduct hearings to the ABS-CBN franchise, but there can be no reports, submitted by the Senate as an institution,” Mr. Drilon said.

Senator Sherwin T. Gatchalian, who presided over the hearing, clarified that the panel would not finalize the committee report until the House officially transmits its version.

“The preliminary hearings will not yield to a committee report. This is purely anticipatory, exploratory as well as clarificatory,” he said. — Charmaine A. Tadalan

T-bills fully awarded

THE TREASURY made a full award of the 35-day papers.

THE GOVERNMENT made a full award of the 35-day Treasury bills (T-bills) auctioned off on Tuesday on strong demand as investor appetite for short-term papers continues to strengthen.

The Bureau of the Treasury (BTr) on Tuesday raised P15 billion as planned via the 35-day papers out of bids worth P33.422 billion.

To accommodate excess demand, the BTr also opened its tap facility to raise another P10 billion.

The 35-day papers fetched an average rate of 2.024%, down by 1.8 basis points (bps) from the 2.042% fetched in the previous auction on May 5.

National Rosalia V. de Leon said the auction was met with strong reception from investors who showed “strong preference” for the short-term papers.

Ms. De Leon said this was evident in the oversubscription, as the total tenders were two times more than the programmed offer.

“Saw sustained investor strong preference for short end with twice subscription for P15 billion offering. Rates further declined from previous 35-day auction,” she told reporters via Viber yesterday.

The BTr has been making full awards and opening its tap facility since the first half of April on declining rates and robust demand as investors flocked to safe-haven assets amid lingering uncertainties.

“Strong interest for short dates persisted as reflected in the good volume subscription with investors opting to put liquidity to work in this part of the curve,” Kevin Palma, peso sovereign debt trader of Robinsons Bank Corp. said in a Viber message.

On Monday, the BTr upsized the T-bills it awarded to P24 billion as total bids reached P103.8 billion, with rates falling across-the- board.

The Treasury also raised another P5 billion in one-year papers via the tap facility.

The government is planning to borrow P170 billion from the local market this month: P110 billion via its weekly T-bill auctions and the remaining P60 billion via Treasury bonds to be offered fortnightly. — B.M. Laforga

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