THE PHILIPPINES slid three spots to 73rd out of 178 economies in a global ranking on economic freedom by The Heritage Foundation, which took note of the government’s continued failure to address corruption and to ease trade restrictions. Read the full story.
THE benchmark index ended its four-day winning streak, closing in the red on Thursday on profit taking following developments in the coronavirus disease 2019 (COVID-19) situation in the country.
The Philippine Stock Exchange index (PSEi) went down by 60.27 points or 0.86% to close at 6,882.49 on Thursday, while the broader all shares index declined by 23.54 points or 0.56% to 4,163.22.
“The rally that we have been seeing in the last few days is confirmed to be more of a correction after several weeks of decline instead of higher valuations due to the rollout of vaccines or easing of restrictions,” AAA Southeast Equities, Inc. Research Head Christopher John J. Mangun said in an e-mail. “The market’s general trend is still sideways as the sentiment remains cautious due to the uncertainty of the economy’s recovery.”
“Inflation worries arising from the various stimulus measures in many economies and rising COVID-19 cases caused by the South African variant in Pasay could mean a repeat of last year’s economic ordeal as a worst case,” PNB Securities, Inc. President Manuel Antonio G. Lisbona said in a text message.
External developments also continued to affect the market, another analyst said.
“The rise in the US bond yields and the elevated inflation expectations here at home weighed on investor sentiment triggering Thursday’s profit taking,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a Viber message.
“Trading volumes were also notably lighter [on Thursday]…, possibly due to investor caution ahead of the February inflation report due out [on Friday],” China Bank Securities Corp. Research Head Rastine Mackie D. Mercado said in an e-mail.
Value turnover fell to P7.11 billion yesterday with 2.7 billion shares switching hands from the P34.09 billion with 221.53 billion shares seen the previous day.
Majority of sectoral indices declined on Thursday, except for industrials, which rose by 17.21 points or 0.19% to close at 8,834.05.
Mining and oil dropped 182.41 points or 1.97% to finish at 9,076.89; property fell by 45.34 points or 1.28% to 3,477.62; holding firms went down by 82.77 points or 1.15% to 7,083.48; financials lost 6.08 points or 0.41% to end at 1,473.69; and services inched down by 1.51 points or 0.1% to 1,449.37.
Decliners outnumbered advancers, 119 against 110, while 40 names closed unchanged.
Net foreign selling also rose to P627.63 million on Thursday from the P350.57 million seen on Wednesday.
PNB Securities’ Mr. Lisbona said the market could close at 6,612 today, placing the PSEi’s immediate resistance at the 7,000 level.
“Trading [on Friday] may take cue from the February consumer price index data, which is set to be released. A February inflation print, which nears or exceeds the upper end of the Bangko Sentral ng Pilipinas’ projection which is at 5.1%, may cause a sell-off since it would intensify concerns towards the price level situation in our country,” Philstocks Financial’s Mr. Tantiangco said. — K.C.G. Valmonte
THE PESO weakened versus the greenback on Thursday on expectations that February inflation data to be released on Friday would be faster than last month’s print.
The local unit closed at P48.62 per dollar on Thursday, retreating by 14 centavos from its P48.48 finish on Wednesday, data from the Bankers Association of the Philippines showed.
The peso started Thursday’s session at P48.53 per dollar, which was also its intraday best. Meanwhile, its weakest showing was at P48.65 against the greenback.
Dollars traded decreased to $817.23 million on Thursday from the $1.094 billion logged on Wednesday.
The peso dropped versus the dollar as investors expect a faster February headline inflation print, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.
A BusinessWorld poll of 16 analysts last week yielded a median estimate of 4.8% amid elevated food and fuel prices. If realized, this would be the second straight month of headline inflation beyond the central bank’s 2-4% target range and also the quickest since the 5.1% print in December 2018.
Inflation stood at 4.2% in January. The Philippine Statistics Authority will release February inflation data this Friday.
Meanwhile, a trader attributed the peso’s weakness to the market’s reaction to new signals from the US Federal Reserve on quantitative easing.
“The peso weakened after Chicago Fed President Charles Evans hinted in his speech about the possibility of extending the maturities of Fed’s asset purchases,” the trader said in an e-mail.
Mr. Evans said the recent trend of faster rise in bond yields reflect improvements in the economy, Reuters reported. He said despite the increase, yields are still below the pre-pandemic 1.75% and are being held down in part by global demand for safe assets.
For today, Mr. Ricafort expects the peso to move within the P48.55 to P49.70 band versus the dollar while the trader gave a forecast range of P48.50 to P48.70. — L.W.T. Noble with Reuters
TUNNELING EQUIPMENT for the Kaliwa Dam is due to arrive in May, signaling the imminent resumption of work on the contentious project, Cabinet Secretary Karlo Alexei B. Nograles said at a televised briefing Thursday.
“Pag dumating ‘yung tunnel boring machine, mas mapapabilis natin, mas makikita natin ‘yung mabilis na pag-usad ng project (When the machinery arrives, things will move forward and progress will be more evident),” he said.
The government hopes to develop the Kaliwa Dam, on the Kaliwa River in Quezon and Rizal provinces, as an alternative source of water for Metro Manila by 2025, Mr. Nograles said.
The machinery is needed to build an integrated reservoir on the border of the two provinces, eventually allowing it to supply 600 million liters of water per day to the capital region.
The China-funded project has been resisted by indigenous communities, religious groups, and environmental activists.
In report in 2019, the Commission on Audit questioned a decision by the implementing agency, the Metropolitan Waterworks and Sewerage System (MWSS), to issue a notice to proceed to contractor China Energy Engineering Corp. Ltd. covering the detailed engineering, design, and construction of the project, without having obtained prior consent from affected communities.
Separately, Mr. Nograles said the revised water concession agreements being discussed by the government with Manila Water Co., Inc. and Maynilad Water Services, Inc., are now in the final phase of review.
“‘Yung inatasan to work out with proposed water agreements (The water agreement revisions we were ordered to work on) are already in final stages… finishing touches na lang po,” Mr. Nograles said at the same briefing.
He provided no further details.
The President ordered a reworking of the water concession agreements held by the two companies, which supply water to the capital region, in the wake of the 2019 water crisis.
The MWSS is currently working on six major water projects to improve water security in the National Capital Region, Mr. Nograles said.
“All together, these projects will be able to supply a total of 1,368 million liters per day (MLD).”
Mr. Nograles said the projects include the New Centennial Water Source — Kaliwa Dam Project; the Long Term Water Source Development for Metro Manila Project (Upper Kaliwa and Kanan River); the East Bay Water Supply Project – Phase 1; the East Bay Water Supply Project – Phase 2; the Wawa-Calawis Water Supply Project – Phase 1; and the Wawa-Calawis Water Supply Project – Phase 2. — Kyle Aristophere T. Atienza
A FACILITY to inspect imported meat, which farmers have called critical for preventing the further spread of African Swine Fever (ASF), is expected to be completed by December at the Manila International Container Terminal (MICT), an agriculture department official said.
At a virtual briefing Thursday, Department of Agriculture National Livestock Program Director Ruth S. Miclat-Sonaco said: “The facility is projected to be done within the year, around December, if everything goes well. Then hopefully by next year, the other facilities will be established at Batangas, Subic, Cebu, and Davao.”
Farmers have blamed imported meat as the source of the ASF outbreak, and called the establishment of the facility critical to limiting the further spread of the hog disease, which has depleted the Luzon herd and made pork more expensive, threatening another inflation crisis.
In a statement Thursday, the Philippine Maize Federation, Inc. (PhilMaize) and the Philippine Chamber of Agriculture and Food, Inc. (PCAFI) said they consider the facility to be critical in preventing the spread of ASF, and expressed hope that construction will proceed without delay.
“ASF as we know comes from outside of our country. We are very strict and compliant with all protocols in our movements from within our territory. Yet we failed (to prevent the disease from getting through) the borders,” PhilMaize President Roger V. Navarro said.
The Department of Agriculture (DA) has said that the first meat inspection facility which will go up at the MICT, to be known as an agricultural commodity examination area, will cost P521.57 million.
PCAFI President Danilo V. Fausto urged the government to undertake a major hog vaccination campaign.
Mr. Fausto said the DA and Bureau of Animal Industry should procure ASF vaccines from Vietnam, adding that the spread can be mitigated with the use of rapid test kits developed by the Central Luzon State University.
Agriculture Secretary William D. Dar has said that the DA is in talks with suppliers in the UK and Vietnam for the possible ASF vaccine trials. — Revin Mikhael D. Ochave
THE National Economic and Development Authority (NEDA) said the damage caused by the Taal Volcano eruption and the typhoons of late 2020 has been estimated at P113.4 billion.
The eruption of Taal Volcano in January 2020 cost the economy at least P8.4 billion in damage to assets as well as foregone income, while the typhoons and resultant flooding in the fourth quarter caused P105 billion in losses, Acting Socioeconomic Planning Secretary Karl Kendrick T. Chua said in a speech Thursday during the launch of the “Ready to Rebuild” program, which aims to help government offices draft better rehabilitation plans.
Losses due to severe natural disasters between 2010 and 2019 were estimated at P463 billion, he said, citing data from the Philippine Statistics Authority.
“These disasters and emergencies have led to billions worth of government resources being spent for cash assistance, rehabilitation and reconstruction efforts which could have been spent for other programs to improve the lives of our fellow citizens and promote more sustainable development,” he said.
Mr. Chua said the most destructive typhoons in recent history were Typhoons Pedring in 2011, Pablo in 2012, Yolanda in 2013, Glenda in 2014, Lando in 2015 and Ompong in 2018.
“NEDA has been working and strongly advocating for more investment in disaster-risk reduction programs. We need to strengthen pre-disaster planning, particularly disaster mitigation and preparedness. Proper planning is key to guiding the recovery efforts and to build more resilient communities to improve structures, services and governance,” he said.
He added proper planning will also help government agencies identify appropriate measures to minimize the impact of natural disasters and assist in determining budgets.
Mitigating, preparing, adapting and responding quickly to natural disasters will result in fewer disruptions to economic activity and provide communities with more safeguards, according to Ndiame Diop, the World Bank’s country director for Brunei, Malaysia, the Philippines and Thailand, speaking at the same forum.
“When disasters happen, it is best not to be caught off guard and with no plans nor financial resources to recover. Local leaders should equip themselves with adequate knowledge and tools to mobilize quickly and provide just in time support to their people,” Mr. Diop said.
Mr. Chua also called on local government units to institutionalize training by next year when they receive a larger share of government revenue in compliance with a Supreme Court ruling, known as the Mandanas case, reworking the revenue-sharing arrangements between the national and local governments. — Beatrice M. Laforga
THE Intellectual Property Office of the Philippines (IPOPHL) has authorized its enforcement unit to request the removal of online posts and advertisements for counterfeit and pirated goods.
The agency officially expanded the powers of its enforcement arm to include digital and online channels via its Memorandum Circular No. 2020-049.
The enforcement arm will need to pursue its takedown request in coordination with other agencies and service providers, following the receipt of complaints from intellectual property rights owners, IPOPHL said in a statement Thursday.
IPOPHL also has the power to issue cease-and-desist orders, order the removal of counterfeit and pirated goods from physical establishments, and ask other government agencies to cancel business permits and other licenses.
Violators now have 72 hours to comply with enforcement decisions, from 60 days previously.
Under the revised rules, IPOPHL can monitor online and physical marketplaces without needing to receive complaints.
“(This type of monitoring allows our office to) take on a more proactive approach and help brand owners screen markets of IP (intellectual property) violating listings, with prospects of reporting possible infringements to concerned IP right holders for their validation and appropriate action,” IPOPHL Director General Rowel S. Barba said.
E-commerce firms Lazada and Shopee recently signed an agreement establishing a procedure for dealing with counterfeit products on their platforms, in coordination with brand owners.
IPOPHL, however, said that amendments to the intellectual property code are still needed for the agency to issue take-down orders on infringing websites, for enforcement by the National Telecommunications Commission.
Under such an amendment, “the National Telecommunications Commission will automatically and immediately enforce it, without further evaluation as their systems can trust the expertise and competence of IPOPHL,” IPOPHL Deputy Director General Teodoro C. Pascua said.
The revised rules took effect on March 3. — Jenina P. Ibañez
THE Bureau of Internal Revenue (BIR) projected collections of P3.92 billion from Philippine Offshore Gaming Operators (POGOs) in 2021, based on the industry’s weak tax yield in January.
BIR Deputy Commissioner Arnel SD. Guballa said January collections from the embattled industry, which has been exiting the Philippines, amounted to P372 million, down 68.63% from a year earlier.
“The total projection for POGO revenues for taxable year 2021, our projection is P3.92 billion based on January voluntary payments,” Mr. Guballa told the Senate Ways and Means Committee.
“So the (full-year) amount is based on the January actual collection multiplied by 12 months,” he added.
The Senate committee is discussing a bill taxing the industry.
Mr. Guballa said collections dropped in January because most POGOs stopped operating.
“The real reason on this drop in collection is that during the pandemic… most of the POGOs stopped operating, that is one major factor that’s why there was a drop in collection,” he said.
“So there are still some who are paying but nonetheless, their operations are now dramatically smaller,” he added.
The Supreme Court in January also issued a temporary restraining order against a provision of Republic Act No. 11494 or the Bayanihan to Recover as One Act, which imposes 5% franchise tax on the industry.
The high court also stopped the implementation of the BIR’s Revenue Regulations No. 30-2020 and memorandum circulars 102-17 and 078-18, after 14 licensed POGOs questioned the franchise tax.
Senate President Pro Tempore Ralph G. Recto in January 2020 filed Senate Bill No. 1295 which seeks to impose a 30% income tax rate and franchise tax equivalent to 5% of gross receipts.
Foreign-based operators are also subject to 30% income tax attributed to game offerings or facilities that are in-country.
Mr. Recto said that the government could collect P65 billion from the industry if the proposed tax measure is passed.
“Of course, it is not my desire to tax them to death. The idea is to nurture them but be able to collect the taxes also at the same time,” he said.
Arnold Ferdinand C. Salvosa, assistant vice-president of the Philippine Amusement and Gaming Corp. licensing department, said the casino industry opposes the 5% franchise tax because it maintains a 97% payout rate leaving them with a margin of 3%.
“When you tax based on gross revenue, actually abonado pa ang casino (the casino is out of pocket)… For example, on a 5% tax on gross, say for a P100 bet, the casino would be taxed P5, while we’re only actually retaining P3,” he said.
“So that’s why the casino industry is really objecting to the tax on gross betting or turnover. The industry will die,” he added. — Vann Marlo M. Villegas
THE Bureau of Internal Revenue (BIR) is set to meet again with its Russian counterparts this month to seal a partnership that will help the Philippines digitize its tax administration.
Russia’s revenue agency, the Federal Tax Service (FTS), has expressed its willingness to support the Philippines in automating digitizing tax administration, the Department of Finance (DoF) said in a statement Thursday, citing BIR Deputy Commissioner Arnel SD. Guballa.
The FTS and the BIR met on Jan. 13 via Zoom to discuss best practices in tax administration and compliance.
Finance Undersecretary Antonette C. Tionko said proposed support for BIR’s digitization efforts will be discussed at a bilateral meeting this month.
The DoF said the government pitched to FTS Deputy Commissioner Dmitry Volvach the possibility of cooperation between the two revenue agencies.
In February 2020, Finance Secretary Carlos G. Dominguez III sought Russia’s help in establishing a tax data capture program for BIR’s value-added tax collection.
In a separate statement Thursday, BIR Commissioner Caesar R. Dulay said that the one-stop-shop system launched on Jan. 28 for business registration and transactions with state offices will streamline the processing of requirements and boost tax collection.
“It will likewise put more taxpayers into the tax net thereby strengthening revenue collection efforts and eventually pump more lifeblood into the veins of government operations,” Mr. Dulay added.
He was referring to the Central Business Portal, an online system that centralizes transactions with the government such as registration of businesses and obtaining permits and licenses. — Beatrice M. Laforga
THE Department of Agriculture (DA) said it created a technical working group to study the problems of broiler poultry farmers.
Agriculture Secretary William D. Dar signed Special Order No. 197 on March 3 creating the Technical Working Group on Broiler Concerns.
Mr. Dar said the group will collate and analyze data on the industry, including supply and demand, production costs, development plans for the sector, consultation with industry stakeholders.
The group is also authorized to make policy recommendations for the industry in coordination with other DA agencies.
“The technical working group was created… to ensure that the broiler sector’s concerns are proactively and adequately addressed,” Mr. Dar said in the special order.
Gregorio A. San Diego, Jr., chairman of the United Broiler Raisers Association, said in a mobile phone message that the DA should also develop a road map for the industry to give the working group a starting point.
“If there is no road map for the broiler sector, what will be the guide during industry consultations? Not having that might cause confusion among the parties and the discussions will have no order,” Mr. San Diego said.
According to the DA, the technical working group on broiler concerns will be chaired by Rene C. Santiago, assistant director for production and research of the Bureau of Animal Industry.
In a virtual briefing Thursday, Agriculture Spokesperson Noel O. Reyes said the DA’s road map for the broiler sector is being formulated, but did not give a timeline for its completion.
“The DA will give updates regarding the road map plan in the succeeding days,” Mr. Reyes said.
According to the Philippine Statistics Authority (PSA), the Philippine chicken inventory as of Jan. 1 was 179.78 million birds, up 0.9% from a year earlier.
The broiler chicken inventory as of Jan. 1 was down 4.7% year on year at 53.72 million birds. The PSA said layer chicken numbers rose 4.2% year on year to 42.93 million birds. Native chicken inventory rose 3.1% year on year to 83.14 million birds. — Revin Mikhael D. Ochave
By Kyle Aristophere T. Atienza, Reporter
CHINA will donate 400,000 more doses of CoronaVac shots made by Sinovac Biotech Ltd., according to President Rodrigo R. Duterte, in a boost to the Philippine drive to vaccinate more of its most vulnerable population.
“You have my assurance that the government will be exerting all efforts to roll out the nationwide COVID-19 vaccination program to enable us to reopen our schools and slowly resume our face-to-face learning,” the President said in a speech during inauguration rites for public education facilities in Valenzuela City on Thursday.
He said he will lift coronavirus restrictions once vaccines become widely available. Mr. Duterte earlier said the Philippines could return to normalcy by 2023.
The Philippines has vaccinated more than 9,000 Filipinos, mostly medical frontliners against the coronavirus since its inoculation drive started on March 1, according to the presidential palace.
The patients were injected with CoronaVac, presidential spokesman Herminio “Harry” L. Roque, Jr. told a televised news briefing on Thursday.
The government took delivery of 600,000 doses of the vaccine donated by China on Sunday.
Mr. Roque said Mr. Duterte could choose his own vaccine brand because he is the country’s top leader and a senior citizen.
The Department of Health (DoH) reported 2,452 coronavirus infections on Thursday, bringing the total to 584,667. The death toll rose by 15 to 12,404, while recoveries increased by 266 to 535,037, it said in a bulletin.
There were 37,226 active cases, 90.1% of which were mild, 4.9% did not show symptoms, 2.1% were critical, 2.1% were severe and 0.81% were moderate.
The DoH said eight duplicates had been removed from the tally, while five recovered cases were reclassified as deaths. Four laboratories failed to submit data on March 3.
About 8.4 million Filipinos have been tested for the COVID-19 virus as of March 2, according to DoH’s tracker website.
The coronavirus has sickened more than 115.8 million and killed about 2.6 million people worldwide, according to the Worldometers website, citing various sources including WHO data. About 91.5 million people have recovered, it said.
ELDERLY
In a related development, a DoH technical advisory group might recommend the use of AstraZeneca shots for health workers aged 65 and above, Cabinet Secretary Karlo Alexei B. Nograles told a separate televised news briefing on Thursday.
South Africa has stopped the rollout of the AstraZeneca vaccine after a scientific study showed that it was less effective against the coronavirus strain that came from there.
Meanwhile, Mr. Nograles said the government might place the entire country under the most relaxed level of community quarantine in the next few months as the Philippines takes delivery of more vaccines next quarter.
Vaccine czar Carlito G. Galvez, Jr. earlier said the country would take delivery of a million coronavirus vaccines from China’s Sinovac Biotech Ltd. this month.
The first batch of coronavirus vaccines developed by Pfizer would arrive next quarter, he said.
The palace earlier said only health workers would be exempted from the vaccination rule that Filipinos cannot choose what vaccine brand they will get.
Mr. Duterte has said he would wait for the coronavirus vaccine made by another Chinese firm, Sinopharm Biotech Group Ltd. because CoronaVac is not recommended for senior citizens.
The local Food and Drug Administration has yet to approve Sinopharm’s application for emergency use.
Earlier in the day, Cabinet Secretary Karlo Alexei B. Nograles said thousands of people in the capital region got injected with CoronaVac.
Of the 600,000 vials, about 189,600 have been delivered to various vaccination centers nationwide, he told a separate news briefing. About 12,000 vials were delivered to Davao City and 7,200 to Cebu City from the cold storage facilities in the capital region, he added.
Vaccines would be delivered to the rest of the country based on a masterlist of targets in 17 regions, Mr. Nograles said.
Mr. Roque earlier said the presidential legal team was studying whether the President as commander-in-chief of the Armed Forces, is covered by the compassionate use authorization for Sinopharm.
Presidential security guards are under investigation for taking the shots last year without regulatory approval. — with Vann Marlo M. Villegas
THE PHILIPPINES will take delivery of 4.58 million doses of coronavirus vaccines made by AstraZeneca Plc in May under a global initiative for equal access, according to the World Health Organization (WHO).
“The Philippines is receiving one of the largest consignments of COVID-19 Vaccine Global Access vaccines in this first initial consignment,” WHO Country Representative Rabindara Abeyasinghe told an online news briefing on Thursday.
The government was set to get the first delivery of 487,000 AstraZeneca vaccines on Thursday night. The vaccines got delayed by a few days due to supply problems.
Mr. Abeyasinghe said there was no exact date yet on the arrival of the vaccines but these would come in larger batches. The country needs to set up enough storage capacity to manage the coming vaccine stocks, he added.
The WHO representative said the government would soon take delivery of 117,000 doses of Pfizer, Inc. vaccines that got delayed after the government failed to submit documents freeing the drug maker from potential lawsuits.
More vaccine allocations from Pfizer would be known before the end of the month, he said.
Mr. Abeyasinghe said vaccines under the COVAX facility should be given to the most vulnerable population first including health workers, the elderly and people with comorbidities.
He urged the Department of Health (DoH) and partners engaged in the rollout of the vaccines to follow the COVAX protocol.
“If we want to ensure that we continue to access the vaccines from the COVAX facility, we need to demonstrate that we can follow this prioritization,” he added.
Mr. Abeyasinghe said the AstraZeneca vaccine can be used against the coronavirus variant first detected in South Africa.
OCTA Research fellow Nicanor Pier Giorgio Austriaco on Wednesday cited the need to eliminate the South African coronavirus variant because the AstraZeneca vaccine efficacy against it is reduced to 10% from 70%.
Mr. Abeyasinghe said that they are looking into these reports, but noted that the sample used for the study on the efficacy was less than 2,000. He added that there was no evidence yet of a large-scale presence of the South African variant in the country.
The WHO thinks the AstraZeneca vaccine is still effective even in places with many cases of the coronavirus variant, he said.
Health Undersecretary Maria Rosario S. Vergeire on Tuesday said both the South African and United Kingdom variants are more contagious. The South African variant’s mutation might affect vaccine efficacy, she added.
The Health department on Tuesday reported the first six cases of the variant first reported in South Africa, three of whom were from Pasay City. — Vann Marlo M. Villegas
