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Anfernee Simons, Stephen Curry, Domantas Sabonis win All-Star competitions

ANFERNEE Simons kissed good-bye the competition in the NBA Slam Dunk competition Sunday night, nearly locking lips with the rim on a grand finale that was deemed good enough to edge Obi Toppin for the 2021 crown as the league’s top dunker during the annual All-Star festivities in Atlanta.

The 21-year-old from the Portland Trail Blazers shared the All-Star Game undercard spotlight with Stephen Curry, who needed to make his last shot to edge Mike Conley in the 3-Point Contest, and Domantas Sabonis, who won a battle of big men over Nikola Vučević for the Skills Challenge crown.

After winning Round 1 of the three-man competition with 95 points, one more than New York Knicks rookie Toppin, the two were allowed just one more dunk to determine the 2021 champion.

Toppin, who had dunked over his father, Obadiah, and teammate Julius Randle to eliminate Cassius Stanley in the first round, completed his finals dunk first, setting the stage for Simons to do better.

He did, jumping high enough so that his puckered lips nearly came in contact with the rim as he slammed the ball through the hoop.

In a new scoring system, Simons was deemed to have performed the best dunk in the finals by three judges, while the other two opted for Toppin.

Simons had the highest scoring dunk among two attempts apiece in the first round, scoring a 49 on his second try after being awarded a 46 on his first.

Toppin scored 48 and 46 for a 94 total, one fewer than Simons but easily enough to beat out the Indiana Pacers’ Stanley (44, 37) for the second spot in the finals.

As a concession to the COVID-19 pandemic, the 3-point and skills competition were held immediately before the NBA All-Star Game on Sunday instead of one day prior. The slam dunk contest was scheduled for halftime of the All-Star Game.

The NBA’s leader in total 3-pointers this season with 169, Curry watched as fellow finalists Jayson Tatum put up 17 points, while Conley, the NBA’s reigning H-O-R-S-E competition champ, had 27. It set the stage for the 2015 3-point champion, who had dominated the earlier first round.

Curry was four points behind when he arrived at his last rack of five balls, then made three of four to get within one point before hoisting the red-white-and-blue two-point ball through the hoop just before time ran out to finish with 28.

The Sacramento Kings’ Buddy Hield used the same final-shot heroics to win last year’s championship.

Curry joined Jason Kapono, Peja Stojaković, Jeff Hornacek and Mark Price as two-time champs in the distance-shooting event. Craig Hodges and Larry Bird won three each.

Curry is one of two Golden State Warriors ever to win the title, with teammate Klay Thompson winning in 2016. Warriors coach Steve Kerr, who played most of his career for the Chicago Bulls, was the 1997 winner.

Shooting last, Curry dominated the first round, running up 31 points to lead Conley (28) and Tatum (25) into the three-man finals.

Zach LaVine (22), Donovan Mitchell (22) and Jaylen Brown (17) were eliminated in the first round.

A runner-up to Bam Adebayo last year, Sabonis defeated Julius Randle, Luka Dončić and Vučević en route to the Skills Challenge crown.

The victory was the fourth in the last six years for a big man, with the 6-foot-11 Indiana Pacers center joining Karl-Anthony Towns, Kristaps Porzingis and Adebayo among recent winners.

Sabonis, who missed his last eight 3-point shots for the Pacers leading into the All-Star break, needed just one shot to cap first- and second-round wins over Randle and Dončić.

After Vučević had eliminated Robert Covington and Chris Paul, he got a shot at the title but missed his first 3-point attempt in the finals against Sabonis.

The Pacers big man got off four quick attempts, with his fourth finally going through the hoop as Vučević was launching his third try.

Paul and Dončić, the co-favorites in the event, received first-round byes. But neither was able to take advantage, each falling in the semifinals in their first run through the dribbling, passing and shooting course. — Reuters

Rare Kobe Bryant rookie card sells for $1.795 million

A FLAWLESS Kobe Bryant rookie card, considered “one of the rarest in existence,” according to Goldin Auctions, has sold to an anonymous buyer for $1.795 million.

The Topps trading card is one of just two in the world considered to be in “black label pristine condition,” the auction house said, and is the most expensive Kobe Bryant card ever sold.

The National Basketball Association (NBA) champion died a little over a year ago in a helicopter crash alongside his daughter and seven others at the age of 41, shocking the world of sport and sending fans of the Los Angeles Lakers star into mourning.

“The fact that it sold for the final auction price of $1.795 million, the all-time record for any Kobe Bryant card, speaks to just how beloved he was around the world,” said Goldin Auctions founder Ken Goldin.

The 18-time NBA All-Star retired from the league in 2016 after one of the most decorated careers in basketball history, and is the NBA’s fourth all-time leading scorer.

Basketball rookie cards, which are often coveted by collectors, are trading cards that are the first to feature an athlete after they reach the professional ranks. — Reuters

Moneybees opens three crypto exchange outlets

Moneybees, a cryptocurrency over-the-counter (OTC) service in the Philippines, opened three new outlets in February in the Trinoma, Glorietta, and Okada branches of Tivoli Money Exchange, a money changer service. 

“With the rising demand for cryptocurrency trading and investment, we aim to facilitate P2 billion worth of transaction volume in 2021. To serve more customers, we’re also looking at opening more outlets in malls around the Philippines and partnering with major market players in the remittance and money exchange industry. We target to open 100 outlets by the end of the year,” said Paulo E. Del Puerto, Moneybees chief executive officer, in a statement. 

Its other outlets are Monteal Money Changer in Venice Grand Canal Mall, Psulit Money Changer in Intrepid Plaza, Willyn Villarica Jewelry in Market Market, and Erus Maerd Pawnshop and Money Exchange in Resorts World Manila. 

In an interview with BusinessWorld, he added that more institutions will embrace cryptocurrency, bitcoin, and blockchain by adding them as part of their assets or using them as part of their technology stack.

“We will see some big companies supporting or even issuing out their own cryptocurrencies,” Mr. Del Puerto said. “This, in turn, can give the general public more access and more confidence in cryptocurrency, making it more acceptable.”

Founded in 2017, the local company provides the technology to make the exchange between currencies and digital currencies accessible to government-licensed money changers with physical outlets. This technology makes it possible for money changers to accept and facilitate cryptocurrency transactions without the risk of market volatility.

Almost all cryptocurrency users with Binance, Bitmex, and other exchange wallets are supported by the platform. Users can transact as much as P5 million in one day. They can also cash out their trading gains from exchanges that don’t have peso cashouts like Binance, Bittrex, and Bitstamp. 

The most popular cryptocurrencies in the Philippines are Bitcoin and Ethereum, according to Moneybees, with Bitcoin accounting for the most transactions on its platform.  

Moneybees is registered with the Banko Sentral ng Pilipinas (BSP) and with the Anti-Money Laundering Council (AMLC) as a remittance agent with Virtual Currency Exchange (VCE) service. — Patricia B. Mirasol

White House cites ‘active threat,’ urges action despite Microsoft patch

Image via Microsoft/Stephen Brashear/Getty Images

WASHINGTON — The White House on Sunday urged computer network operators to take further steps to gauge whether their systems were targeted amid a hack of Microsoft Corp.’s Outlook email program, saying a recent software patch still left serious vulnerabilities.

“This is an active threat still developing and we urge network operators to take it very seriously,” a White House official said, adding that top US security officials were working to decide what next steps to take following the breach.

CNN on Sunday separately reported the Biden administration was forming a task force to address the hack. The White House official, in a statement, said the administration was making “a whole of government response.”

While Microsoft released a patch last week to shore up flaws in its email software, the remedy still leaves open a so-called back door that can allow access to compromised servers and perpetuating further attacks by others.

“We can’t stress enough that patching and mitigation is not remediation if the servers have already been compromised, and it is essential that any organization with a vulnerable server take measures to determine if they were already targeted,” the White House official said.

Already, a source told Reuters more than 20,000 US organizations had been compromised by the hack, which Microsoft has blamed on China, although Beijing denies any role.

The back channels for remote access can impact credit unions, town governments, and small businesses, and have left US officials scrambling to reach victims, with the FBI on Sunday urging them to contact the law enforcement agency.

Those affected appear to host Web versions of Microsoft’s email program Outlook on their own machines instead of cloud providers, possibly sparing many major companies and federal government agencies, records from the investigation suggest.

A Microsoft representative on Sunday said it was working with the government and others to help guide customers, and the company urged impacted clients to apply software updates as soon as possible.

Neither the company nor the White House has specified the scale of the hack. Microsoft initially said it was limited, but the White House last week expressed concern about the potential for “a large number of victims.”

So far, only a small percentage of infected networks have been compromised through the back door, the source previously told Reuters, but more attacks are expected. —  Jeff Mason/Reuters

The COVID/Brexit cocktail: UK lost market share in US, Germany and China — report

LONDON — The United Kingdom lost market share in the United States, Germany, and China during the coronavirus disease 2019 (COVID-19) pandemic due to global trade chaos, Brexit, and poor productivity, according to new research published on Monday.

The United Kingdom performed particularly badly due to a long-term stagnation in productivity growth, according to the report by Aston University’s Lloyd’s Banking Group Centre for Business Prosperity.

While all countries grappled with the tumult of COVID-19, the United Kingdom lost market share in its biggest export markets—the United States and Germany, the research showed.

“In some key export destinations—Germany, the UK and China—the UK seems to have suffered a sharper decline, experienced a slower recovery, and seen its global competitiveness dwindle,” the report said.

“The UK’s decline in exports to the US appeared the sharpest in both absolute and relative terms and the most prolonged among the major European countries (except for France).”

Between 2017 and 2019, the UK increased total exports to Germany by 8.5%—less than the export growth achieved by Italy(12%), the Netherlands (14%) and Spain (20%), as well as the United States (24%).

“This to some extent paints a picture of slowing UK exports to Germany following the 2016 Brexit referendum, which may indicate some decoupling between the two economies,” economists Jun Du and Oleksandr Shepotylo said in the report.

The research, based on United Nations trade statistics, also indicates that the UK lost market share in China. 

“The combination of COVID, Brexit and the UK’s long-term productivity challenges will put British businesses in an adverse position for the foreseeable future,” the report said.

The United Kingdom’s relatively poor productivity has puzzled economies for years: explanations vary from poor employee skills and low research investment to demand-side factors such as the financial crisis. — Reuters

COVID-19 travel insurance becoming a vacation staple

Coronavirus disease 2019 (COVID-19) insurance policies are increasingly joining passports and sunscreen as vacation staples, creating opportunities for insurers as more countries require mandatory coverage in case visitors fall ill from the coronavirus.

Airline bookings are on the rise in some regions, driving cautious hopes of a revival in summer traffic, but also raising fears among tourist destinations of getting hit with bills should vacationers become stranded by the virus.

More than a dozen countries from Aruba to Thailand require COVID-19 coverage for visitors, with Jordan the latest to consider such protections, organizers of an emergency services plan told Reuters.

The market for all types of COVID-19 travel coverage is estimated to be between $30 billion to $40 billion a year, according to travel insurance consultant Robyn Ingle, with companies like AXA and AIG underwriting protection.

But a surge in demand for COVID-19 coverage also means insurers could be on the hook for big payouts should another wave of infections lead to large numbers of cancellations or tourists getting sick.

“Travel insurance and protection services are taking off at pace with travel as it resumes, said Dan Richards, chief executive for travel risk and crisis management firm Global Rescue.

COVID-19 insurance benefits typically cover treatment up to $100,000, and could include coronavirus testing costs and services like evacuation or local burial or cremation. These benefits, introduced by insurers in mid-2020, are sold either as add-ons or as separate policies with coverage for illness or quarantine.

Jeremy Murchland, president of Indiana-based travel insurance company Seven Corners, said travelers are now “more likely to insure their trips,” as more countries require COVID-19 coverage.

A travel insurance plan that includes trip protection, medical expense coverage for COVID-19 and protection for baggage and personal effects typically costs 4% to 8% of the dollar value of the trip, Mr. Murchland said.

While the pandemic has battered travel, demand for coverage has created opportunity for the hard-hit insurance industry and a niche to develop new products, companies said.

For example in June, Seven Corners introduced an optional medical travel plan with coverage for coronavirus expenses, Mr. Murchland said. By year’s end, the product with coronavirus coverage generated about 80% of total medical travel plan sales.

Seven Corners also saw a 20% rise in travelers buying highly priced “cancel for any reason” policies in 2020. The policies cover cancellation costs related to the virus.

Some countries have mandated travel insurance for incoming visitors—either by including it in their entry or visa fees or by requiring proof of coverage, said insurer World Nomads.

Jordan is evaluating whether to require a mandatory flat fee for visitors as part of a program from Global Rescue and the Global Travel and Tourism Resilience Council, said council co-chair Taleb Rifai. The program, which costs up to $100 per person, covers certain disasters and illnesses like COVID-19.

Jordan’s Tourism Bureau was not available for comment.

It is not clear how coverage demand will evolve as many more people become inoculated against the coronavirus with vaccines.

Frank Comito, a special advisor to the Caribbean Hotel and Tourism Association, said some budget travelers have complained about mandatory coverage. And some countries could discontinue or relax the requirement as “we move away from the pandemic.”

Mr. Rifai, former secretary-general of the UN’s World Tourism Organization, said he expects countries will continue requiring coverage as the vaccines “will take years” to roll out globally. — Allison Lampert and Noor Zainab Hussain/Reuters

Meghan accuses UK royals of racism, says ‘didn’t want to be alive’

LONDON — Meghan, the wife of Prince Harry, accused Britain’s royal family of raising concerns about how dark their son’s skin might be and pushing her to the brink of suicide, in a tell-all television interview that could send shockwaves through the monarchy.

The 39-year-old, whose mother is Black and father is white, said she had been naive before she married into royalty in 2018, but that she ended up having suicidal thoughts and considering self-harm after pleading for help but getting none.

Meghan said that her son Archie, now aged one, had been denied the title of prince because there were concerns within the royal family about “about how dark his skin might be when he’s born.”

“That was relayed to me from Harry, those were conversations that family had with him,” Meghan recounted in an interview with Oprah Winfrey aired on CBS late on Sunday.

Meghan declined to say who had aired such concerns, as did Harry, who said his family had cut them off financially and that his father Prince Charles, heir to the British throne, had let him down and refused to take his calls at one point.

Buckingham Palace had no immediate comment about the interview, which aired in the early hours of Monday morning in Britain.

The sit-down conversation with Ms. Winfrey was the most anticipated royal interview since Harry’s late mother Princess Diana shared intimate details of her failed marriage to Charles in 1995, denting the heir’s reputation and the family’s standing in the eyes of the British public.

Nearly three years since her star-studded wedding in Windsor Castle, Meghan described some unidentified members of the royal household as brutal, mendacious, and guilty of racist remarks.

She also accused Kate, the wife of her husband’s elder brother Prince William, of making her cry before her wedding.

While the family came in for open criticism, neither Harry nor Meghan attacked Queen Elizabeth directly.

Still, Meghan said she had been silenced by “the Firm”—which Elizabeth heads—and that her pleas for help while in distress at racist reporting and her predicament had fallen on deaf ears.

“I just didn’t want to be alive anymore. And that was a very clear and real and frightening constant thought. And I remember how he (Harry) just cradled me,” Meghan said, wiping away tears.

‘REALLY LET DOWN’
Harry and Meghan’s announcement in January 2020 that they intended to step down from their royal roles plunged the family into crisis. Last month, Buckingham Palace confirmed the split would be permanent, as the couple looks to forge an independent life in the United States.

Harry, 36, said they had stepped back from royal duties because of a lack of understanding, and he was worried about history repeating itself—a reference to the death of his mother Diana who was killed in a 1997 crash as her car sped away from chasing photographers.

Asked what his mother would say about events, he said: “I think she would feel very angry with how this has panned out and very sad.”

He felt “really let down” by his father, and added: “My family literally cut me off financially.”

Harry denied blindsiding Queen Elizabeth, his grandmother, with his decision to shun life within the monarchy, but said his father stopped taking his calls at one point.

“I had three conversations with my grandmother, and two conversations with my father before he stopped taking my calls. And then he said, can you put this all in writing?”

Detractors say the couple wanted the limelight, but were not willing to live with the attention it brought. To supporters, their treatment shows how an outdated British institution lashed out against a modern, independent biracial woman.

LIES AND TEARS
There have also been allegations of bullying against Meghan which appeared in The Times newspaper in the buildup to the couple’s appearance. Buckingham Palace said it would investigate the claims, adding it was “very concerned.”

Meghan told Ms. Winfrey that people within the royal institution not only failed to protect her against malicious claims but lied to protect others.

“It was only once we were married and everything started to really worsen that I came to understand that not only was I not being protected but that they were willing to lie to protect other members of the family,” Meghan said.

Meghan denied a newspaper story that she had made Kate, Duchess of Cambridge, cry before the wedding and said it was a turning point in her relations with the media and the palace.

“The reverse happened,” Meghan said. “A few days before the wedding she (Kate) was upset about something, pertaining to yes the issue was correct about the flower girl dresses, and it made me cry. And it really hurt my feelings.”

Meghan, who said they were not paid for the interview, conceded she had not realized what she was marrying into when she joined the British monarchy and “went into it naively.”

The couple also revealed that Meghan, who is pregnant with their second child, was expecting a girl.

Harry said Meghan had “saved” him from his trapped royal life. “I would disagree, I think he saved all of us. You made a decision that certainly saved my life,” Meghan said.

“This is in some ways just the beginning for us.” — Michael Holden and Guy Faulconbridge/Reuters

Game of drones: Chinese giant DJI hit by US tensions, staff defections

SHENZHEN — Chinese drone giant DJI Technology Co. Ltd. built up such a successful US business over the past decade that it almost drove all competitors out of the market.

Yet its North American operations have been hit by internal ructions in recent weeks and months, with a raft of staff cuts and departures, according to interviews with more than two dozen current and former employees.

The loss of key managers, some of who have joined rivals, has compounded problems caused by US government restrictions on Chinese companies, and raised the once-remote prospect of DJI’s dominance being eroded, said four of the people, including two senior executives who were at the company until late 2020.

About a third of DJI’s 200-strong team in the region was laid off or resigned last year, from offices in Palo Alto, Burbank, and New York, according to three former and one current employee.

In February this year, DJI’s head of US R&D left and the company laid off the remaining R&D staff, numbering roughly 10 people, at its flagship US research center in California’s Palo Alto, four people said.

DJI, founded and run by billionaire Frank Wang, said it made the difficult decision to reduce staffing in Palo Alto to reflect the company’s “evolving needs.”

“We thank the affected employees for their contributions and remain committed to our customers and partners,” it said, adding that its North American sales were growing strongly.

“Despite misleading claims from competitors, our enterprise customers understand how DJI products provide robust data security. Despite gossip from anonymous sources, DJI is committed to serving the North American market.”

It did not comment on the other US staff departures that current and ex-employees spoke of, although it told Reuters last year its global structure was becoming “unwieldy to manage.”

DJI, which has become a symbol of Chinese innovation since it was founded in 2006, is one of dozens of companies caught in the crossfire of trade and diplomatic hostilities between Washington and Beijing, like Huawei and Bytedance.

Staff sources and competitors say the company’s brand reach, technical know-how, manufacturing might, and sales force mean it won’t lose its crown anytime soon in the multi-billion-dollar US and global markets for non-military drones.

But a December order adding the company to the US Commerce Department’s “Entity List” along with the closure of its R&D operation in California could affect its ability to serve the needs of US customers, according to three former senior executives and two competitors.

The Commerce Department listing, enacted over allegations including DJI enabled “high-technology surveillance,” prohibits the company from buying or using US technology or components.

The same month, Romeo Durscher, DJI’s US-based head of public safety, who had played a central role in building the company’s business in providing drone technology to non-military US government departments and agencies, left his job.

Mr. Durscher, a former NASA project manager and an influential figure in the drone industry, now works at Swiss company Auterion, a competitor to DJI.

He said he left DJI because he was disheartened by the staff cuts and what he described as internal power struggles between the US team and its China headquarters. He added that the US reorganization complicated the task in dealing with the fallout from US-China tensions and winning government business.

“It’s not an easy decision to leave the market leader that’s really far ahead of everyone else,” said Mr. Durscher, who joined DJI in 2014. “But those internal battles were distracting from the real purpose and in 2020 it got worse … we lost tremendous talent at DJI and that’s very unfortunate.”

US SECURITY CONCERNS

Privately held DJI doesn’t publish sales figures. The US Department of Defense estimated the American non-military market was worth $4.2 billion last year. Consultancy DroneAnalyst said DJI controlled almost 90% of the consumer market in North America and over 70% of the industrial market.

The December listing by the Commerce Department, and the prohibition on buying US parts, may impact the firm’s mobile apps, web servers, and some battery and imaging products, said David Benowitz, head of research at DroneAnalyst and a senior figure with DJI’s enterprise team, which works with industrial customers, in Shenzhen before he left last summer.

DJI said in December that the ban would not affect US customers’ ability to buy and use its products.

The listing followed other official blows. In October, the U.S. Department of the Interior said it would only buy drones from companies okayed by the Department of Defense, which last August published a list of five approved drone suppliers to the federal government—four American and one French.

DJI said there was no “broad-based US government ban on purchasing DJI drones.”

“Congress considered that approach last year and rejected it, because … such a ban would be challenging for many companies and government bodies that rely on drones,” it added.

‘WE’RE STILL PRIMITIVE’

Mr. Benowitz said persisting US-China tensions and the push by Washington to support DJI’s rivals could see the company’s North American market share decline. He added that, while the federal government comprised a relatively small part of DJI’s business, its restrictions could have a “chilling effect,” with other buyers worried about tougher measures in the future.

“We’re at a point where there are too many market opportunities for one player to dominate,” he said.

Yet he added alternatives to DJI were relative minnows, though both policy support and security concerns over Chinese drones had brought them growth in the last year. Competitors to DJI include France’s Parrot and California-based Skydio.

Chris Roberts, chief executive officer of Parrot Inc., Americas, said 2020 had been a significant year for the company in the United States, having been named an approved supplier by the Defense Department and won business from emergency services and security agencies.

Skydio announced $170 million in D-round funding last week and said it had a valuation of over $1 billion.

“DJI makes good hardware but we are still very early in the market, and very primitive compared to what ultimately should exist,” Skydio CEO Adam Bry told Reuters.

PHANTOM DRONE FLEETS

When Mr. Durscher joined DJI back in 2014, the company’s Phantom series was transforming drones from a niche hobby to a mainstream gadget. He said he was particularly drawn by the chance to bring drones into the kit of fire and rescue departments.

He said the technological advances of smaller rivals in the last year were tempting for some public-safety agencies, who might say “let’s go with this drone now so we don’t have to deal with the data security.”

He added that change could come as government departments and companies looked to replace drone fleets that are nearing the end of their life cycles.

A fleet is typically expected to last three to four years, according to Mr. Benowitz.

Mr. Durscher and several other staff compared DJI’s internal rivalry over projects to Game of Thrones, the TV series where rival factions vie for power. He said this resulted in a rotating door of Shenzhen bosses, and that he reported to 12 different managers in his six years at the company.

Mr. Durscher’s departure from DJI followed those of other key executives in North America last year, including director of business development Cynthia Huang.

Ms. Huang, who now works with Mr. Durscher at Auterion, said she became increasingly frustrated because she felt DJI wasn’t able to meet all the growing demands of the enterprise market. Additionally, she said, job cuts over the past year added to the reasons she decided to leave. The losses in Palo Alto, Burbank, and New York had followed cuts made to DJI’s global sales and marketing teams, which Reuters reported in August.

“Some of the people that we lost in those layoffs, it didn’t make sense,” said Ms. Huang, who was hired in 2018 to take the lead in building DJI’s enterprise business in North America. “The continued exodus of talent was discouraging.” — David Kirton/Reuters

[B-SIDE Podcast] ASEAN’s ‘troubled little sibling’ and the fragility of democracy

Myanmar is in the middle of a bloody coup, where, as of this episode’s recording, at least 50 people have been killed since it began in February. Pro-democracy activists are taking to the streets, protesting the military’s attempt to reverse the victory of Aung San Suu Kyi and the National League of Democracy (NLD).

In this episode of B-Side, Atty. Michael Henry Ll. Yusingco, a senior research fellow at the Ateneo Policy Center, speaks with BusinessWorld reporter Kyle Aristophere T. Atienza talks about the fragility of democracy and draws parallels between the mass demonstrations in Myanmar and the 1986 People Power Revolution.

TAKEAWAYS

Myanmar has gained a reputation of being the “problem member” of the Association of Southeast Asian Nations (ASEAN).

While a number of countries around the world have already spoken against the revival of military rule in Myanmar and have committed to restoring democracy in the Southeast Asian country, the Philippines—considered the oldest democracy in Southeast Asia—and other neighboring countries have only given a tepid response to the newest erosion of democracy in the region. 

“They should not forget that all governments in our region have the responsibility to defend their people. Whether we believe it or not, all ASEAN member states adhere to constitutional principles like democracy, rule of law, human rights,” said Mr. Yusingco. “For all ASEAN member states, we can all hold each other to account for all of our governments to defend the rights of their people. The government should never forget that.”

At the same time, Mr. Yusingco said that the Philippine government’s response was expected. “We will always be calculated, we will always be tempered in our response. And the reason for that is, that kind of way has worked for us. … We have never been at war with each other.”

‘People power’ is not just about the mass movements or the rallies. People power is about organizing at the community level.’

Prior to headline-making protests, civil societies in Myanmar were already organizing at the grassroots level. “What we’re seeing now is just a result of that span of work,” said Mr. Yusingco. “That is now where democracy is alive in Myanmar.” 

The Philippines has become ‘too complacent’ with its democracy, and should learn from the crisis in Myanmar.

“We have free speech, we have free assembly but let’s look at the quality of our public discourse,” said Mr. Yusingco, who added that political dynasties represent the biggest threat to Philippine democracy.

“Political dynasties equate to bad governance,” he said. “If we continue on this path of electing political dynasties to leadership positions, … our democracy will further deteriorate.”

The Philippines can avoid a democratic crisis, Mr. Yusingco continued, “by not voting for political dynasties in 2022 and by helping non-dynastic candidates run.”

This B-Side episode was recorded remotely on February 26. Produced by Paolo L. Lopez and Sam L. Marcelo.

Bad loans pick up anew in January

NONPERFORMING loans (NPLs) held by big banks rose again in January, after a debt moratorium expired at the end of 2020.

Data from the central bank showed the bad loan ratio stood at 3.7% in January, inching up from the 3.61% in December and the 2.16% recorded a year ago.

Gross NPLs edged 0.15% higher to P392.256 billion from P391.657 billion in December, but 67% up from the P234.987 billion logged in January 2020.

Loans are considered nonperforming once they are left unpaid at least 30 days beyond the due date. They are deemed risky to lenders’ asset quality as these have a high risk of default.

As soured loans started to pile up, banks’ total loan portfolios declined 2.34% to P10.608 trillion in January from the P10.862-trillion level in December and by 2.57% from the P10.888 trillion a year earlier.

“The slight pick up in the NPL ratio may be partly attributed to the end of the 60-day extension of loan/debt payments under Bayanihan II,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

Republic Act No. 11494 or the Bayanihan to Recover as One Act provided for a one-time 60-day loan moratorium which expired on Dec. 31, 2020. Starting January, borrowers had to resume debt-servicing or incur penalties.

In January, past due loans reached P505.837 billion, jumping by 4.9% from the P482.115 billion the prior month and by 58% from the P319.643 billion in January last year. This brought its ratio to 4.77% from 2.94% in January 2020.

Meanwhile, restructured loans fell 6.17% to P194.473 billion from P207.278 billion but surged 335% from the P44.697 billion seen a year ago.

As asset quality deteriorated, lenders boosted their allowance for credit losses by 1.09% to P371.102 billion from the prior month’s P367.094-billion level and by 72% from the P215.204 billion last year.

Banks’ NPL coverage ratio, which gauges the allowance for potential losses due to bad loans, stood at 94.61% from the 91.58% in January 2020.

Mr. Ricafort said banks’ NPL ratio could still pick up in the coming months.

He said the passage of Republic Act No. 11523 or the Financial Institutions Strategic (FIST) Law could be an offsetting factor as it will allow banks to sell their nonperforming assets to FIST corporations with tax perks.

Fitch Ratings on Friday, however, said that while the FIST could help banks unload their soured loans, “the pace of disposal will likely hinge on implementation and economic recovery.”

Mr. Ricafort said easing of restriction measures would provide “some sustainable solutions” to the adverse impact of the pandemic as it will allow sales, employment and livelihood to pick up in both the formal and informal economy.

“All of these improve the ability to pay off many businesses, consumers, and other institutions, thereby would help sustain reduction/improvement in banks’ NPL ratio,” Mr. Ricafort said.

The NPL ratio peaked at 17.6% in 2002 in the aftermath of the Asian Financial Crisis. Fitch Ratings expects this to reach 4.5% to 5% by end-2021 with more bad loans likely to pile up in the first half of 2021. — Luz Wendy T. Noble

Philippines falls in Tholons’ Digital Nations list

By Arjay L. Balinbin, Senior Reporter

THE Philippines dropped out of the top 10 in a list of countries that are considered attractive destinations for technology, digital and innovation, and business process management, after seeing a decline in the workforce population amid the pandemic.

From fifth place in 2020, the Philippines now ranks 18th in the Top 50 Digital Nations, according to the latest Tholons Global Innovation Index.

At the same time, Metro Manila and Cebu City both saw their rankings slide in Tholons’ Top 100 Super Cities list. Metro Manila slipped to 8th spot from 2nd place last year, while Cebu City plummeted to 52nd place from 12th spot a year ago.

Philippines slips in Tholons 2021 ranking of ‘Digital Nations’

In the innovation index, the Philippines fell 13 spots, even as its scores rose to 0.65 (up 12%) in digital and innovation, and to 0.62 (up 29%) in super cities.

However, its score for workforce population slumped by 95% to 0.04. This was one of the lowest scores for the workforce population — an indicator of the talent pool available that can be skilled or re-skilled to serve cross industries in services.

The Philippines also scored 2.34 in the diversity and inclusion area, a new indicator in this index that assesses nations in terms of women’s equality, pay gap, women in leadership roles, and funding made available to women entrepreneurs. This was among the highest scores for this area globally.

It should be noted, however, Tholons increased its emphasis on digital factors in this year’s index to 40% from 25% last year, when it attributed traditional factors with 75% weightage.

The parameters considered for digital and innovation, an area where the Philippines saw some improvement are: open innovation ecosystem; number of startups; startup diversity and maturity; innovative policies and incentives; investors; unicorns; cybersecurity; global digital competitiveness; digital literacy rate; digital evolution; digital talent and high-tech patent grants; business agility; and usage of robotic process automation, artificial intelligence and cloud.

The United States bounced back to the top spot on the innovation index, from third place in 2020. India slipped to second place from last year’s top ranking, followed by Canada (third from fourth), Germany (fourth from 35th), and Singapore (fifth from ninth).

Other Southeast Asian nations also saw their rankings slide on the list, namely Vietnam (25th from 13th), Malaysia (33rd from 26th), Thailand (35th from 27th), and Indonesia (50th from 20th).

SUPER CITIES
Metro Manila saw its ranking slip as a “super city” after getting lower scores — 0.38 (down 66%) in the talent, skill and quality indicator; 0.26 (down 72%) in business catalyst; 0.41 (down 62%) in cost and infrastructure; and 0.80 (down 23%) in risk and quality of life. Its score improved to  3.16 (up 84%) in terms of innovation and capital.

Meanwhile, Cebu’s score in the talent, skill and quality indicator was unchanged at 0.77. Its scores were mixed — 0.40 (down 47%) in business catalyst, 0.89 (up 7%) in cost and infrastructure, 0.93 (up 6%) in risk and quality of life, and 0.85 (down 33%) in innovation and capital.

Toronto topped the list of super cities, followed by Singapore (second from ninth), Bangalore (third from first), San Francisco (fourth from 30th), and Dublin (still fifth) .

Other super cities in Southeast Asia included Kuala Lumpur (17th from 18th), Hanoi (50th from 31st), Bangkok (51st from 79th), Ho Chi Minh (58th from 39th), Penang (77th from 88th), and Jakarta (85th from 52nd).

“Organizations will need more active engagement strategies, if they want to thrive and succeed,” Tholons, a global strategic consulting, digital innovation and investment advisory group, said in the report.

“Leading businesses are adopting ‘human-AI’ collaboration. As social distancing becomes the norm, in many industries, robots are transitioning faster than expected from regulated environments to unregulated environments. Corporations and governments are looking for more and newer ‘contact-less’ solutions,” it added.

Sought for comment, Terry L. Ridon, convenor of InfraWatch PH, said via e-mail: “We have serious concerns on the methodology of the Tholons index, in which we are seeing downward trends of 95% on workforce population, 66% in talent, skill and quality indicators, 72% in business catalyst, 62% in cost and infrastructure, and 84% in innovation and capital.”

“Outside of the coronavirus crisis, there is nothing substantially different from the previous year on Filipino talent, business environment and innovation to warrant the substantial reduction of ratings in these areas,” he added.

Mr. Ridon noted, however, that the results should be viewed as a continuing challenge to further improve the quality of the country’s workforce, especially in artificial intelligence (AI), machine learning, robotics, and biotechnology areas.

“Instead of a focus on graduates readily available for overseas deployment, such as those in the healthcare sector, higher education should also focus on training a new set of graduates who can globally compete within the country,”’ he said.

He expects Manila and Cebu to remain the main hubs for innovation and talent pool.

“But a clear nexus should be made between academe and industry to produce professionals who can provide the needed knowhow for the current zeitgeist for AI, robotics, machine learning, among others,” Mr. Ridon explained. “The government, through the Commission on Higher Education, plays a major role in defining this nexus.”

For his part, Claro dG. Cordero, Jr., director and head of research at Cushman & Wakefield, said the Philippines is exhibiting the challenges of “mature/traditional markets, made more complicated by the ongoing pandemic.”

To address concerns over its workforce population, he said the Philippines should step up its efforts to further expand the talent pool by attracting labor that can adapt to more digital enhancements in the industry.

“Relevant stakeholders must provide more skills enhancements, as well as ensure competitiveness of the industry to provide secure, safe and rewarding career pathing — factors that continuously pose threats to talent availability,” Mr. Cordero noted.

On the decline of Manila and Cebu’s rankings, Mr. Cordero noted the imbalance between demand and supply in business process outsourcing and technology innovation needs to be addressed for the cities to regain their competitiveness.

“There needs to be a specific focus on sourcing skilled labor to address substantial reduction in training overheads and increasing complexity of the roles within the BPO sector,” Mr. Cordero explained.

“There should also be more diversity in skill enhancements, such that — while the majority of demand for BPO services is still being driven largely by English-speaking industrialized countries, there is an increasing demand for multilingual operators who can serve different marketplaces. Cebu and Manila, being the biggest BPO markets locally, need to continually work with its neighboring areas and provinces to ensure strategic hiring practices and to harness a consistent regulatory environment,” he added.

PHL pushes for freer rice trade in ASEAN

TRADE Secretary Ramon M. Lopez is pushing for the inclusion of rice in a list of essential goods exempt from restrictive trade measures in the Association of Southeast Asian Nations (ASEAN) during the coronavirus disease 2019 (COVID-19) pandemic.

The 10 member states in November signed a memorandum of understanding committing to refrain from new and unnecessary non-tariff trade measures on a list of 152 essential goods, consisting mostly of medical products, to prevent supply disruption during the COVID-19 pandemic.

Mr. Lopez called for the inclusion of staple food like rice in a potential expanded list during an online meeting with ASEAN economic ministers on March 2-3, the Department of Trade and Industry (DTI) said in a press release on Sunday.

“It is imperative for ASEAN to show to our stakeholders that Member States are determined to ensure the smooth flow of these essential goods in these challenging times,” he said.

“In fact, even in normal circumstances, it is incumbent upon Member States to refrain from implementing unnecessary non-tariff trade measures.”

The ASEAN economic ministers are looking at expanding the essential goods list to include food and agricultural products.

Member states may still impose restrictions in cases of a public health emergency, but must conform with international trade obligations.

More Philippine companies in 2019 reported burdensome non-tariff measures compared with Asia-Pacific economies, a joint report of the United Nations Economic and Social Commission for Asia and the Pacific and the United Nations Conference on Trade and Development said.

LOWER TARIFFS
Meanwhile, the Finance department is supporting moves to lower tariffs and ease other non-tariff barriers on food products as a way to temper the continued rise in consumer prices in the near term.

Finance Undersecretary Gil S. Beltran said in an economic bulletin that inflation will remain elevated in the coming months if supply issues are not addressed immediately.

“Likewise, the price rise is due mainly to regulated products with high tariff rates and non-tariff barriers… Economic decision makers need to ease these protective barriers to provide more competition to heavily protected domestic suppliers,” he added.

Pressed for details, Mr. Beltran said in a text message that easing trade barriers on fish, meat, cereals, rice and other food items, should be a priority since strict “regulations lead to high inflation.”

Headline inflation hit a 26-month high in February, accelerating by 4.7% year on year on rising food and transport prices, the Philippine Statistics Agency reported on Friday.

This was higher than 4.2% in January and 2.6% a year ago. It was also within the central bank’s 4.3%-5.1% estimate for the month but exceeded the 2-4% annual target.

The increase in food costs alone climbed to 6.98% last month from 6.64% in January as prices of meat and vegetables surged by 20.7% and 16.7%, respectively.

The interagency Committee on Tariff and Related Matters (CTRM), which the National Economic and Development Authority (NEDA) co-chairs with the Trade department, proposed to lower the most favored nation (MFN) tariffs for pork and rice to address the expensive food costs.

“We are fast-tracking policies determined to stabilize food supply to ensure that households affected by COVID-19 and the quarantines will not be doubly affected by the increase in food prices,” Acting Socioeconomic Planning Secretary Karl Kendrick T. Chua said in a statement on Friday.

The move to lower tariffs for pork and rice follows the earlier proposal of the Agriculture department to hike the minimum access volume (MAV) for pork imports to 404,000 metric tons (MT) from 54,000 MT.

The higher MAV threshold meant more imports will be charged at the lower 30% rate while those above the quota will pay a 40% tariff. The move is meant to temper high meat prices due to the ongoing African Swine Fever (ASF) outbreak, but has yet to be approved by President Rodrigo R. Duterte.

University of Asia and the Pacific economist George N. Manzano said lower tariffs and more pork imports would be a quick response to address supply-side issues on high food prices.

However, Mr. Manzano who is also a former tariff commissioner, warned the short-term solution could have an adverse impact on the local agricultural sector.

“It will make certain agri industries less attractive to investments. But these are pandemic days, where shipping needed supplies to the capital from the other regions is not easy due to the restrictions,” he said in a Viber message on Sunday.

“The government can aim for calibrated and temporary tariff reduction until the domestic suppliers can recover from the effects of the swine disease,” he added. — Jenina P. Ibañez and Beatrice M. Laforga

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