Home Blog Page 8380

Supply chain disruption likely to cause price spikes — DoF

THE PRICES of goods may spike, amid the disruption of global supply chains due to the continued spread of the coronavirus disease 2019 (COVID-19), the Finance department (DoF) said on Sunday.

“The disruption of global supply chains will tend to push prices up. Domestic producers will need to look for alternative supply sources to avoid production cuts,” the DoF said in its economic bulletin on Sunday.

Citing initial data from the Customs bureau, the DoF said imports from China dropped by 34.7% in terms of volume in February. China is the country’s biggest trading partner.

Inflation eased at a slower-than-expected 2.6% in February on softer price increases of food, transport and utilities, from 2.9% in January. This brought year-to-date inflation to 2.8%, well within the central bank’s 2-4% target for the whole year.

However, the DoF said “benign global oil prices will pull down inflation going forward.”

Oil prices have plunged to multi-year lows as demand was hit by economic fallout from the coronavirus. Virus fears, travel bans and other precautionary measures have dampened global economic activity.

For inflation rate to settle within the 2-4% target range, the DoF said the “month-on-month price change should be at most 0.3% per month.”

ASSESSING THE IMPACT
President Rodrigo R. Duterte is set to declare on Monday a public health emergency to help contain the spread of COVID-19, after the country recorded its first case of local transmission. There are six confirmed COVID-19 cases in the country as of Sunday.

Government economic managers are set to meet on Tuesday to further assess the virus outbreak’s impact on the economy following a rise in the number of confirmed cases in the country.

“Right now, what we see on the impact of COVID-19 is essentially on tourism and that’s very clear. What is not so clear is the impact on the productive capacity of our trading partners and the supply chain, and also the demand for our products — that’s quite unclear at the moment,” Finance Secretary Carlos G. Dominguez III told reporters on Friday.

Meanwhile, government officials said public infrastructure projects are not facing delays due to a shortage in raw materials and equipment, mainly from China.

“Right now we’re not seeing any effects yet, but we have to closely monitor that and then see the effects… on China, which supplies all of these construction materials, heavy equipment, for the entire world will be affected by this,” Vivencio B. Dizon, presidential adviser for flagship programs, said a press conference on Friday.

Mr. Dominguez said any slowdown will not be immediately seen as businesses typically have two or three months worth of inventory.

“You won’t see an immediate effect if there’s a slowdown because there’s inventory here. Let’s say they keep three months’ inventory, the slowdown started in, let’s say mid-February… It’s only in May that you’ll see the slowdown, if there is a slowdown at all,” Mr. Dominguez said. — Beatrice M. Laforga

Credit cards face adversity in country where cash is king

By Beatrice M. Laforga
Reporter

MA. VICTORIA M. DIOQUINO, 33, switched to using electronic wallets a year ago to pay her electricity and phone bills.

“Mobile payments are much more convenient and user-friendly than credit cards,” the bank employee from Parañaque City said in an interview.

The space for credit card growth in the Philippines is rapidly shrinking with the rise of mobile payments.

In the early days of online shopping, credit cards offered a convenient way to shop, but new mobile technologies and apps now offer a more seamless shopping experience with faster checkouts and the option of in-app payments.

The World Bank said 5% of Filipino borrowers surveyed had electronic wallets in 2017, slightly higher than the 4% global average.

Aside from electronic wallets, the credit card industry also has had to contend with fraud.

People still need to be educated about the risks and benefits of credit, Alex G. Ilagan, executive director of the Credit Card Association of the Philippines, said in an interview.

About 10 million credit cards have been issued in the Philippines, and the regular cardholder probably uses two credit cards, he said. That’s a big jump from just 200,000 cards two decades ago.

“In terms of spending, the total amount of credit card billings in the first nine months of 2019 was P866.9 billion,” Mr. Ilagan said. “That is equivalent to an average amount of about P87,000 per card, or close to P10,000 a month per card.”

World Bank data put credit card ownership in the Philippines lower at 2% in 2017, behind its peers in East Asia and the Pacific region where ownership was 22%.

The credit card industry has been doubling efforts to educate the market about data security, managing debt and maximizing credit.

“Financial discipline and awareness of security including fraud are very important,” Mr. Ilagan said.

One such victim was 22-year-old Neil Aronn S. Diamzon, a first-time credit card user.

Not so long ago, he received what he thought was just another sales call from a bank. He gave away personal information to the caller, who promised perks such as double credit limit and waived annual fees for a lifetime.

“It was too good to be true, but I was naive and took their offer anyway,” Mr. Diamzon, a software engineer, said in an interview.

A few minutes later, he received another call from his bank informing him of an online purchase worth P20,000 he knew he never made.

Banks are the most conservative when it comes to ensuring that transactions are secure, so they tend to invest in the latest technology, Mr. Ilagan said.

Banks are also working with regulators such as the National Privacy Commission and Bangko Sentral ng Pilipinas (BSP) to ensure their data remained secure.

The central bank advises consumers on its website to sign their credit cards as soon as they receive them, avoid giving out personal and financial information requested via e-mail, and transact only with secure websites.

Credit card companies have also been using integrated circuit card technology to prevent counterfeiting. It’s much harder to steal the information from chip credit cards or to clone them.

Mr. Ilagan said cardholders in the Philippines tend not to maximize their use of credit and CCAP is trying to change that.

“You can use credit to your benefit as long as you don’t abuse it,” he pointed out.

Thea Sy Bautista, who hosts a YouTube channel about financial management, said she has received a number of requests to upload videos on budgeting, credit cards, savings and investment.

“I am most comfortable talking about credit cards because of my overall experience working for a bank and managing my credit cards,” she said in an interview. “I wanted to use my platform to help more people.”

A credit card holder herself, the YouTube blogger said it’s important to “swipe only if I can fully pay the total charges, not just the minimum amount, before they become due to avoid bank charges.”

Despite the small penetration rate, Mr. Ilagan said the credit card industry’s delinquency rate had gone down to 4% from 8% five years ago.

He said the credit card industry needs to work harder to gain more believers.

Aside from e-wallets and fraud, the fact remains that cash is still king in most parts of the world, including the Philippines.

World Bank data showed that 53% of Filipinos paid their utility bills in the past year with cash, compared with the global average of 57%.

Mr. Diamzon has not been deterred by credit card fraud. His experience taught him to become aware of the risks and be more responsible about personal data, he said.

“Weeks later, I received a new credit card and since then, I have been very cautious about anonymous calls and credit card transactions,” he said.

Where the world’s wealthy live

THE PRICES of goods may spike, amid the disruption of global supply chains due to the continued spread of the coronavirus disease 2019 (COVID-19), the Finance department (DoF) said on Sunday. Read the full story.

Where the world’s wealthy live

Measure amending AMLA still being drafted at Senate

THE HEAD of the Senate economic affairs committee is still drafting a measure that seeks to strengthen the Anti-Money Laundering Act (AMLA), as Congress faces pressure to pass the bill before October to help the country avoid sanctions by the global anti-money laundering watchdog.

Senator Imee R. Marcos said in a statement on Sunday that she is considering several AMLA amendments, such as allowing the Anti-Money Laundering Council (AMLC) to investigate suspicious transactions without facing restraining orders from lower courts.

Another proposed amendment to the AMLA is the inclusion of real estate developers and brokers under the list of persons covered by AMLC’s monitoring. At present, the list includes banks and nonbank institutions, pawnshops, insurance companies, securities and jewelry dealers among others.

Also, the Senate bill being drafted by Ms. Marcos will consider tax crimes and the proliferation of weapons of mass destruction and its financing as among the predicate offenses to money laundering.

Ms. Marcos said the measure is expected to be filed within the next two weeks.

The country is currently under observation of the Paris-based Financial Action Task Force (FATF), which gave it until October to strengthen its anti-money laundering law.

Ms. Marcos said failure to amend the law before the deadline puts the Philippines at risk of being included in the FATF’s list as a “non-cooperative country” or “high-risk jurisdiction.”

“If the Philippines fails to pass FATF scrutiny and is marked as a threat to the international financial system, banking sanctions may again be imposed on OFW (Overseas Filipino Workers) remittances and slow down their crucial contribution to the country’s foreign currency reserves,” she said.

The International Monetary Fund (IMF) had also recommended that the Philippines include tax evasion in the list of predicate crimes, improve customer due diligence, and relax the bank secrecy law.

At present, a bill seeking to amend the AMLA is pending at the House committee on banks and financial intermediaries.

Bangko Sentral ng Pilipinas (BSP) Governor and AMLC Chairman Benjamin E. Diokno recently made the same call for Congress to pass the AMLC amendments as well as the proposed Anti-Terror law before October.

The Senate on Feb. 26 passed the measure strengthening government response to terrorism on third and final reading; while its counterpart House measure is still awaiting panel deliberation.

On top of those provided in Ms. Marcos’s draft bill, the BSP also sought to give AMLC the authority to implement targeted financial transactions, preserve assets subject of freeze orders or retain forfeited assets.

The central bank also pushed to expand AMLC’s investigative power to include subpoena and contempt powers. — Charmaine A. Tadalan

Treasury bill rates may decline on appetite for shorter tenors

THE RATES on the Treasury bills (T-bills) on offer today may inch lower amid continued appetite for short-term papers, with investors seen searching for higher returns on longer tenors amid falling interest rates.

The Bureau of the Treasury (BTr) is looking to raise P20 billion via T-bills on Monday: P6 billion each for the 91- and 182-day papers and P8 billion for 364-day securities.

A bond trader said on Friday that “yields for the T-bills auction might move sideways with a downward bias as it seems like appetite for T-bills has lessened,” with rates on three- and six-month papers seen moving sideways and a decline of five basis points (bps) seen for the yield on one-year securities.

Another bond trader, however, said rates may go down by five to 10 bps as investors continue to “crowd short-term papers amid growing concerns about the global economic impact of the coronavirus.”

“US yields also trading at lows after the US Fed delivered a 50-bp emergency cut last week to combat the virus,” the second trader said in a Viber message on Sunday.

Offshore, yields on the 10-year US Treasuries were below the one-percent level at 0.74%, while the 30-year tenor was quoted at 1.25% as of March 6, according to the US Treasury’s website.

During the T-bills auction last week, the government upsized the volume it accepted to P23.2 billion from its initial P20-billion offer amid total bids of P60.4 billion.

Broken down, it fully awarded P6 billion in 91-day T-bills out of total tenders worth P12.813 billion. The average rate for three-month papers inched up by one basis point to 3.013% from the 3.003% fetched in the previous auction on Feb. 24.

Another P6 billion was raised as planned via the 182-day papers at an average rate of 3.324%, down by 4.1 bps from the previous yield of 3.365%.

For the 364-day T-bills, the BTr upsized the award to P11.2 billion from the original P8-billion program as total tenders for the tenor reached P33.06 billion. The one-year securities fetched a lower average rate of 3.684% against the 3.787% quoted previously.

At the secondary market on Friday, the 91-, 182- and 364-day T-bills fetched rates of 3.058%, 3.367% and 3.719%, respectively.

The trader said appetite for shorter tenors might decline as “traders and investors want to lock in higher interest rates for longer periods as interest rates are falling.”

The BTr made full awards of the government securities it offered for the past auctions, even opening its tap facility amid lower rates.

The first trader said yield movements might change amid developments in the coronavirus disease 2019 (COVID-19) outbreak, as the situation is very fluid.

The Department of Health (DoH) reported on Saturday the first case of local transmission in the country after records showed the fifth person to have officially contracted the disease does not have recent travel history outside the Philippines.

The total number of confirmed cases in the country were at six as of Saturday evening.

The DoH also raised its alert system for the disease to code red sub-level one on Saturday as a “preemptive call” to ensure that both national and local governments as well as all health care providers could prepare in case suspected and confirmed cases will rise further.

The administration’s economic team is set to meet on Tuesday to asses the potential impact of COVID-19 on the economy and various sectors.

The Treasury has set a P420-billion local borrowing program this quarter, broken down into P240 billion in T-bills and P180 billion via Treasury bonds.

The government plans to raise P1.4 trillion this year from local and foreign lenders to plug its budget deficit, which is expected to widen to as much as 3.2% of gross domestic product. — Beatrice M. Laforga

Stories in thread and cloth

AMID A climate emergency, a possible pandemic, and all the great and small battles we all fight everyday, the world continued to spin for the designers of Paris. Two designers at the shows in the first week of March showed a nostalgia for days gone by, one designer opted for the arts as a palliative, while one maison refuses to go down without a fight.

BALMAIN
(Video of the fashion show can be seen at https://www.youtube.com/watch?v=5QxkIrfhsoQ)

Olivier Rousteing’s FW 2020-2021 collection for Balmain opened with a line of navy pea coats. Another line showed something reminiscent of desert landscapes with beige and white capes, and the suggestion feels like a call to spend the season somewhere dry and hot. But then, the next few lines show a leaning towards classics of French design — think the safari suits by Yves Saint Laurent, combined with the beige and black piping, and the quilted details of Chanel. One can also see hints of Dior in the strong shoulders in suiting, or maybe in the solid, hard material (possibly plastic) draped on a model like fabric. Rich Baroque prints also dominate some other designs, perhaps reflective of some of the fashion capital’s sights. The whole collection reads like a love letter to the great names of Paris, albeit one that is less florid; colder, bolder, and more urgent (which can sometimes have an even better effect).

CELINE
(Video of the fashion show can be seen at https://www.youtube.com/watch?v=8WJ5E_rg6Gg)

Hedi Slimane’s Celine show was dedicated A Ma Mère (to my mother). The collection is just as much a love letter to the past of Paris as the Balmain show was, but this time with wider references. See, while Balmain’s show was about extolling the virtues of Paris as seen through design, Celine’s vision was a lot more mainstream. By this we mean that the collection is interpreted not through the lens of upper-class wearers, but someone more normal, a little more middle-class. The collection opened with a black shapeless dress that screamed bohemian chic in its flowy skirt, invisible bosom, and long sleeves. It’s accessorized with a necklace with a gold fringe that called the 1970s to mind, and paired with a bowler hat. It looks like what French New Wave cinema said was the type of girl every intellectual wanted to be, or have. Next came a swinging sequined rose gold dress, a black slim-cut men’s suit with a polka-dot foulard neck. We also saw a python-print shirtwaist dress, styled with a slim belt, chic but wild, as if a celebrity had stepped off a jet while off-duty. Feminine tuxedos are also key: we saw another slim-cut suit with a large floppy bow tie with a tuxedo shirt with blown-up ruffles. These pantsuits call back to the Le Smoking tuxedo for women by Yves Saint Laurent, born approximately in the period where Slimane’s mother might have worn them (Hedi Slimane was born in the late 1960s). It thus becomes an homage to bohemian Parisian chic in that period, which saw Youthquake, and the student riots of May ’68.

HERMÈS
(Video of the fashion show can be seen at https://www.youtube.com/watch?v=LSf58Yqxx0s)

Hermès opened with a collection of white and red coats appearing in a landscape reminiscent of the paintings of Piet Mondrian, had the artist made his primary-color blocks as trees and tubes. The collection of coats and layers follow the same clean lines as the paintings, and if they hadn’t been accented with leather and the bright pops of color, they would have had this too-cold, too-clinical chic. Several prints reflect other artworks of the same school of abstraction, thus awakening one’s own sensitivity to art. We do remember that the maison’s specialty is leather, so we saw full-length leather high-necked trenches, pleated leather skirts. We can only imagine the difficulty in treating a leather so it becomes almost as fluid as water, or stiff enough to hold pleats yet still move. We also like the clever little details such as what appears to be jacket lapels actually serving as closures meant to be belted shut.

DIOR
(Video of the fashion show can be seen at https://www.Dior.com/en_int/womens-fashion/ready-to-wear-shows/autumn-winter-2020-2021-ready-to-wear-show)

When Dior started in the postwar period, it dressed women very lavishly, trying to shake off the lean privations of war with rich fabrics and generous, corseted silhouettes. It was a bit of an affront to the humiliated Chanel (rumored to have collaborated with the Nazi enemy), who championed clean lines, ease of movement in dress, and her career was devoted to liberating women from the straitlaces of corsets. In the maison’s 69-year history, Maria Grazia Chiuri is the first woman to lead the important label. In her capacity, she seems to place the focus back on the women who wear the clothes. Her runway for her FW 2020-2021 collection was lit with lights spelling out slogans that may read like a woman’s innermost thoughts, when she feels that the male-dominated world turns against her: “Women’s love is unpaid labor,” “When women strike the world stops,” and “Consent.” In the same week that Ms. Chiuri presented her show, former Hollywood boss Harvey Weinstein was convicted of criminal sexual assault and rape in the third degree.

Ms. Chiuri opened her show with a black pantsuit with Dior’s signature Bar jacket. The Bar jacket, though masculine in design, flares at the hips seemingly to emphasize femininity. From the male gaze of her predecessors, it might show a hint of sex; but from Ms. Chiuri’s feminist perspective, it becomes a celebration of the female power of reproduction (or so we think). Neckties and decidedly masculine suit elements in strict black are also seen throughout the runway, as are shirtwaist dresses in checked prints that are profuse in this collection. White, loose fitting suits seemed to point back to the menocore trend of a few years back, which called to mind a nice retirement at the beach. There’s also a lot to think about in the context of dresses made with fringe, done as if in raw thread, as if they had been shredded before. As they moved down the runway, they predictably showed bits of skin from the threads hanging loosely about the model’s body, while the words “Consent,” in capital letters, floated above her. — Joseph L. Garcia

Metro Pacific studies pullout from NAIA rehab consortium

By Arjay L. Balinbin
Reporter

METRO PACIFIC Investments Corp. (MPIC) is considering pulling out of the so-called “super consortium” that is proposing to rehabilitate the Ninoy Aquino International Airport (NAIA) amid issues on the draft concession deal, its top official said.

“It’s gonna be a tough one — tough one for us to join,” MPIC Chairman Manuel V. Pangilinan told reporters last week when asked for an update on the consortium.

Asked if there is a possibility for MPIC to withdraw from the consortium, he said: “We are thinking about it.”

He said the reasons include the unresolved issue on the real property tax (RPT) payments.

“RPTs, mga ganun-ganun (things like that),” Mr. Pangilinan said, adding that MPIC will have to make a final decision on the matter “soon.”

Siyempre (Of course) it’s unfair naman to make the consortium wait for us. Hindi naman fair ‘yun kasi (It wouldn’t be fair because) they have the right [to know] whether we are in or out,” he continued.

His comments come after Ruben S. Reinoso, Jr., Department of Transportation undersecretary for planning and project development, told reporters on Feb. 24 that the government and the NAIA consortium would have to renegotiate certain parts of the draft concession agreement.

These parts include the plan to lay off airport workers, the use of a bus rapid transit (BRT) system to transport passengers within the airport complex, and the RPT.

Mr. Reinoso said the consortium had suggested that the Manila International Airport Authority (MIAA), which is the primary grantor, should take part in RPT payments.

Nuong una, ang argument nila it’s on net present value, which means that the real property tax payment is part of the inflows to the government per se, pero sabi ko hindi ganun ang agreement natin kasi you will not be keeping MIAA whole [in that case]. Binawas mo pa ‘yung income nila, magagalit ang MIAA sa atin niyan,” he said.

(At first, their argument was that it’s on net present value, which means that the real property tax payment is part of the inflows to the government per se, but I said that was not our agreement because you will not be keeping MIAA whole in that case. Then you also took out their income, MIAA will be angry with us because of that.)

“MIAA should be kept whole, kasi if that is the case, as a corporate, magsa-suffer naman ang MIAA, hindi kami papayag doon and that was the agreement… Pumayag na sila na hindi nila ibabawas sa payment sa gobyerno ‘yun,” he added.

(MIAA should be kept whole because if that is the case, as a corporate, it will suffer. We will not allow that and that was the agreement. They already consented that they will not take it out of the payment to the government.)

Mr. Reinoso said further that the consortium is now defining the boundaries of the property and that they may also start negotiating on the RPT payments with the local government unit (LGU).

Kasi LGU ang nangongolekta niyan, hindi naman kami (It’s the LGU that collects that, not us),” he noted.

Mr. Reinoso also said the government was hoping that concerns regarding the concession agreement would be settled by this month.

The National Economic and Development Authority (NEDA) board approved in November last year the unsolicited P102-billion proposal from a consortium composed of the country’s top conglomerates to rehabilitate the country’s main gateway.

The so-called NAIA super consortium is composed of Aboitiz InfraCapital, Inc; AC Infrastructure Holdings Corp.; Alliance Global Group, Inc.; Asia’s Emerging Dragon Corp.; Filinvest Development Corp.; JG Summit Holdings, Inc.; and Mr. Pangilinan’s MPIC.

“After we have concluded the negotiation, we will go back to the NEDA Board to report on the results of the negotiation and get confirmation,” Mr. Reinoso said.

After which, MIAA will submit the draft agreement to the Office of the Solicitor General and the Department of Finance for comment, he added.

Since it is an unsolicited proposal, the NAIA rehabilitation project will still be subjected to a Swiss challenge.

The Swiss challenge is the competitive bidding process where third-party companies are invited to submit counterproposals to a project, which the original proponent has the right to match.

The rehabilitation of the NAIA, whose main terminal opened in 1981, is expected to increase its capacity to 47 million passengers a year in the first two years and further expand this to 65 million passengers after four years.

The NAIA, which has four terminals, has been operating beyond its 30.5 million passenger capacity. It recorded 45.3 million passengers in 2018.

MPIC is one of three Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being PLDT, Inc. and Philex Mining Corp. Hastings Holdings, Inc. — a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc. — maintains interest in BusinessWorld through the Philippine Star Group, which it controls.

Agriculture dep’t asked to tag upland areas in Davao City for coffee production

THERE ARE about 17,000 hectares in upland areas in Davao City that are ideal for coffee farming, but development needs a push from government, according to the Davao City Coffee Council (DC3).

Ian B. Asilo, DC3 chairman, said the Department of Agriculture’s (DA) Davao regional office, together with the Department of Environment and Natural Resources and the National Commission on Indigenous People, has to identify the areas for coffee production and set up an assistance program to encourage farmers.

“There are 17,000 hectares in the part of Toril going to Marilog where you can plant coffee… but the coffee farms were converted into cacao and banana plantations,” Mr. Asilo said during last week’s Habi at Kape forum.

He noted that these areas used to have more coffee growers, particularly indigenous people (IP) communities, who switched crops in the 1990s following a drop in market prices.

Once the DA has tagged the area, he said, private and social enterprises can also step in to help the IPs and other small-scale growers.

“The private sector, like our organization, can come in because the IP cannot produce in big volume,” Mr. Asilo said.

He said that no coffee farmers in the city can produce 180 kilos of coffee beans, one of the requirements for joining the Philippine Coffee Quality Competition (PCQC).

“All that is needed is some push from the DA,” he said.

Davao City is hosting this year’s Philippine Coffee Expo and the PCQC, set on April 2–3.

The expo is jointly organized by the DA, Department of Trade and Industry, Barista Coffee Academy of Asia, and the Agricultural Cooperative Development International and Volunteers in Overseas Cooperative Assistance (ACDI/VOCA). — Maya M. Padillo

BSP to release rules for Islamic bank products

THE BANGKO SENTRAL ng Pilipinas (BSP) is set to release implementing rules and regulations (IRR) on Islamic financing products in a bid to bolster financial inclusion for people that have limited access to financial products partly due to religious suitability, according to an official.

In an interview with BusinessWorld, BSP Managing Director of the Center for Learning and Inclusion Pia Bernadette Roman-Tayag said while there are already some Shariah-compliant financial products in the market, an IRR could urge more banks to make these kinds of offerings.

“We are going to be issuing our implementing rules for the Islamic finance. So du’n siguro magkakaroon ng details (Maybe the details will be clearer then),” Ms. Roman-Tayag said at the sidelines of an event held by Paymaya Philippines, Inc. and Oxfam Pilipinas held in Mandaluyong City on Thursday.

In 2019, BSP issued Circulars 1069 and 1070, which contain guidelines regarding the establishment of Islamic banks and banking units as well as the Shariah Governance Framework.

“More IRRs will be issued,” Ms. Roman-Tayag said.

She noted that the Muslim Mindanao region is still among the most financially underserved in the country due to lack of financial institutions in the area as well as product suitability.

“First of all, ’yung presence din kasi of banks there, du’n din kasi pinakakaunti (the presence of banks there is the lowest). That’s really one barrier, the actual presence of financial institutions there,” she said.

“So hopefully, with the digital…cash agents, that can be addressed. The second is suitability of products,” she added.

Aside from this, she noted that residents in the region are also restricted to some products amid the lack of Shariah-compliant offerings.

“From the financial inclusion standpoint, we don’t want to exclude people because of religious consideration,” Ms. Roman-Tayag said. “It’s also a form of exclusion, if you are not able to deliver products that they need…for religious considerations.”

A key concept in Islamic banking is that operations do not involve “riba” or interest.

“So hopefully with this new law, and with more providers, we can see more inclusion in the area,” Ms. Roman-Tayag said.

Republic Act. No. 11439 or the act providing for the regulation and organization of Islamic banks was enacted last August.

Among its key provision is to allow traditional banks to operate Islamic banking operations subject to approval from the BSP Monetary Board.

Tengfu Li, Financial Institutions Group Analyst at Moody’s Investors Service, has previously told BusinessWorld that the establishment of an Islamic banking framework will help boost growth in the newly established Bangsamoro Autonomous Region in Muslim Mindanao. — Luz Wendy T. Noble

Philippine history told through fashion

WHILE one may think that clothes don’t matter, history would show otherwise. An era’s fashions show the dictates of society at a point in time: the materials available to a people, the prevalent moral and social codes, and a measurement of the people’s prosperity. A fashion show at the Shangri-La Plaza aimed to tell the story of the Philippines through its clothing: from the pre-colonial period to the near-past of the 1960s.

The show, called Obra Maestra 2020: Homage to Heritage was held at the Shangri-la Plaza’s Grand Atrium late last month. The show also served to announce the book Obra Maestra: A Portrait of Excellence in Philippine Fashion and Culture, set to be released in May. The book and the show are both projects of Zardo Austria. Proceeds of the Obra Maestra efforts will benefit the construction of the Benedictine Sisters Reparatrices of the Sacred Heart’s new monastery and chapel in Mexico, Pampanga. These also raise funds for the Duyog Marawi Project, spearheaded by Bishop Edwin dela Peña, and the victims of the recent Taal Volcano eruption.

Designers who participated in the show include Oskar Peralta, Renee Salud, Ditta Sandico, Richard Papa, Roland Lirio, Steve De Leon, Delby Bragais, Peri Diaz, Albert Figueras, Peter Lim, Ricci Lizaso, Glenn Lopez, Edgar Madamba, Jontie Martinez, Jerome Navarro, Joyce Penas-Pilarsky, Lito Perez, Edgar San Diego, Gerry Sunga, Philip Torres, Edwin Uy, and the late Eddie Baddeo.

The clothes onstage were supported by performances from kundiman musicians, tenor Sherwin Sozon and soprano Tonton Pascual of the Lyric Opera of the Philippines, Mike Austria, Al Gatmaitan, Homer Mendoza, Vince Conrad, and Kathy Hipolito Mas.

The part of the show highlighting the pre-colonial period showed indigenous textiles from all over the country, while the segment covering the Spanish colonial period showed marvelously worked traje de mestizas. Samples of opera and kundiman played in the background as the models swayed down the runway.

The pace picked up with the presentation covering the American period. This is when the quasi-Victorian traje de mestiza evolved into the sleeker, one-piece terno we know today. Jazz and Big Band music played in the background, while outfits by Lito Perez came out. This included a terno with spotted embroidery, a sequined overskirt over a heavily embroidered underskirt in blue and silver, and a gold lamé fichu. For the men, reflecting the Americanization for the upper classes, light summer seersucker suits were brought out on the runway. Of note was a white lace number with blackworked sleeves paired with a black panelled skirt, and the cherry on top, a black lace pañuelo (fichu).

Jontie Martinez, meanwhile, showed off a magnificent terno in black lace and silver sequins. This was accompanied by a peacock-feather collar with a matching fan. The dress, and the one that followed it, imagined the dresses worn by Manila’s Carnival queens, a predecessor of our present obsession with pageants.

The next dress was Ricci Lizaso’s, a one-shouldered evening dress with crystals at the skirt and bodice, topped by a magnificent cockle headdresss. Continuing the beauty pageant theme, Peter Lim drew out a sequinned dress made of net, with a sash forming a bit of a bustle behind. The next dress, by Joyce Pilarsky, was pink, with a ruched ball gown skirt and a massive lace collar appliquèd in gold.

Hollywood’s influence in Philippine fashion was also touched on: Edgar San Diego brought out a villainously chic dress with a model with marcelled hair, wearing a black traje de mestiza with floral appliqués in pink over a very pale pink skirt.

The next segment began by introducing the privations of war, moving swiftly to the Liberation period, again bringing Big Band sound and Swing. Lito Perez brought out a pair of soldiers wearing khaki uniforms, while 1950s fashion was on the runway with models in ruffled skirts and shirtwaists for daywear. Formalwear didn’t take a backseat with a lovely rose-colored traje de mestiza with ruching and panelling at the skirt.

As the country settled more comfortably into the highs of independent government, high society began to throw lavish parties, such as the Kahirup and the rival Mancomunidad balls, which were thrown by rich Southerners and rich citizens of Central Luzon, respectively. The women who attended these lavish occasions were dressed mainly by five people: Ramon Valera, Pitoy Moreno, Aureo Alonzo, Ben Farrales, and R.T. Paras, whose works were exhibited at the mall until the end of last month.

The dresses that came next were interpretations of the creativity of these designers. For example, Steve de Leon’s knotting and draping combine in an angel-sleeved confection of yellow and white. Philip Torres, meanwhile, showed patchwork on a flared skirt made of net, with crystals on the butterfly-sleeved bolero. Delby Bragais showed a simple terno with crystal tendrils extending from the sleeve and waist, and a pattern drawn of crystal formed diamond shapes on the fabric. Edgar Madamba showed a beautiful panelled skirt in the shape of a tulip, below a delicate terno bodice. This was followed by a magenta evening gown.

The last part of the show showed Filipiniana of various lines, of all regions of origin; all made to showcase a sense of Filipino pride. They were all made with colors of the Philippine flag (yellow, red, blue, and white). A series of red dresses by Delby Bragais, for example, featured a tiered skirt and an interesting neckline, but for the series representing the flag’s red colors, we’ll have to give it to a stunning opera coat, spanning several feet, occupying almost the entire width of the runway, in a translucent material (possibly abaca), with a high collar and bell sleeves by Ditta Sandico. Lito Perez brought out a white unstructured terno like an 18th century chemise dress. This was literally given structure with armor made of yellow metal.

Mr. Austria pointed out that outfits that may not have been historically accurate were part of the whole process. “I’m not asking them to be authentic. I told them to stylize,” he said.

It’s interesting to see such an ambitious fashion show in — of all places — a mall. This then democratizes the process, a point Mr. Austria agrees with. “It’s trying to reach out to this generation. These millennials, they’re hungry; they’re thirsty for something cultural,” he said in a mixture of English and Tagalog.

While it’s easy to fall in love with the terno’s shape and style, it isn’t always accessible to a lot of people for its sometimes prohibitive price: the piña (pineapple fiber fabric) used to make some ternos, for example, is hard to source and can be quite expensive. Still, some brands have been daring to turn the terno from formalwear to daywear, thus injecting a sense of Filipino pride (and style) to the everyday.

“That is what we want to encourage. We have to be proud of our heritage,” said Mr. Austria. “If this generation can relate to this type of interpretation, well and good.”

We can see this in Republic Act No. 9242 (Philippine Tropical Fabrics Law), which prescribes the use of native fabrics for official government uniforms. This alone may have spearheaded the ubiquity of the formal barong through its daywear polo-barong cousin, which Mr. Austria points at as a good example of the adaptation of national dress. In a mixture of English and Tagalog, he said, “I’m very, very sure, the terno will adapt as well.” — Joseph L. Garcia

Off-cockpit betting firm refutes P1.3-B unpaid taxes

By Beatrice M. Laforga
Reporter

MANILA Cockers Club, Inc. (MCCI) has refuted reports that it has P1.3 billion in unpaid taxes since the case remains under investigation, although it has agreed to settle the penalties and comply with registration requirements for its ticket-dispensing machines, which were earlier sealed for non-registration.

In a letter to the Bureau of Internal Revenue (BIR), which was obtained by BusinessWorld, MCCI argued that its alleged tax deficiencies “are still in the informal conference stage of the investigation” and that it had not yet received preliminary and final assessment notices from the bureau.

“It is only at that point in time that it can be said that MCCI has been assessed deficiency taxes. Thus, MCCI maintains that the news reports are inaccurate, considering that it has no deficiency taxes,” the document read.

It said it had paid a total of P401.596 million in taxes last year, P145.195 million in 2018, P81.068 million in 2017, P26.065 million in 2016 and P89,908 in 2015.

The BIR reported last week that the company had P1.3 billion in unpaid taxes and that it had no registered automated ticket dispensing machines in any of its 132 locations nationwide.

The bureau sealed 51 machines in some of MCCI’s branches in Quezon City on Thursday, arguing that all businesses need to register their machines as these are used to properly monitor sales and transactions and not doing so will subject companies to penalties and liabilities.

“In keeping with our earnest intention to settle the matter of the non-registration of the ticket dispensing machines, and as a show of good faith, MCCI hereby formally offers to pay the assessment for non-registration of betting machines and undertakes to register said machines forthwith,” the document read.

However, the company argued that its 147 machines used in off-cockpit betting stations are simply betting machines recording “bets and issue tickets as evidence of bets,” and do not issue receipts or invoices “as the amounts paid by bettors are not consideration for any goods sold or compensation for any services rendered.”

“Thus, these machines need not be registered with the BIR,” it said.

Despite this, MCCI said it had agreed to comply with registration requirements and pay necessary fees during its meeting with the BIR-National Investigation Division on March 3.

“Thus, it came as a great surprise when the BIR issued the MO (mission order), and through its agents, proceeded to constructively seize, by sealing, the ticket dispensing machines in the various betting stations,” it said.

According to its website, the company said it is “the only cockfighting event entity that pays taxes due to its legal operations.”

MCCI is a wholly owned subsidiary of the listed company Manila Jockey Club Inc. (MJCI).

Bureau of Fisheries prepares new management strategy as sardine season starts this month

THE BUREAU of Fisheries and Aquatic Resources’ (BFAR) Zamboanga Peninsula regional office is preparing to implement the government’s new fisheries management strategy with the sardine fishing season opening March 1.

BFAR Regional Director Isidro M. Velayo, Jr., speaking during the open season ceremony on March 2 at the Sindangan Port in Zamboanga del Norte, announced that the bureau will be starting this month with an information caravan on the ecosystem approach to fisheries management (EAFM).

Under EAFM, 12 Fisheries Management Areas (FMAs) were established through BFAR Administrative Order 263 issued in January 2019 for a more coordinated policy development and implementation.

Zamboanga Peninsula is under FMA 4 together with the regions of Western Visayas, Central Visayas, and the Bangsamoro Autonomous Region in Muslim Mindanao.

The clustered provinces are: Antique, Guimaras, Iloilo, Negros Occidental, Negros Oriental, Basilan, Sulu, Tawi-Tawi, Zamboanga del Norte, Zamboanga del Sur, and Zamboanga Sibugay.

Mr. Velayo, in a statement, said “despite the fact that handling the area in the region is very challenging,” he is “thankful for this strategy as this will help revolutionize the protection, conservation and ensure the sustainability of the fishery resources for the benefit of our future generation.”

After the information campaign, BFAR will organize the selection of representatives from key stakeholders for the FMA’s Management Board.

The FMA will create and implement an EAFM Plan, which includes goals, roles, and monitoring system.

“The EAFM Plan is a ‘living document’ that is regularly refined and updated to address priority issues and problems. It also considers the governance capacity of implementing partners,” according to a BFAR briefing document.

BFAR will serve as convenor, inter-agency facilitator, and lead agency in implementing action plans for areas outside municipal waters.

Local government units will be responsible for their respective jurisdictions.

Each FMA was set up based on fish stock boundary, range, and distribution, and structure of fisheries and administrative divisions.

The Zamboanga Peninsula Region accounts for almost 50% of the country’s sardine production, based on BFAR’s National Sardine Management Framework Plan 2019–2024. It had a catch of 152,283 metric tons in 2017. — Marifi S. Jara