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Globe-powered ISDApp helps fisherfolks to safely navigate seas

Fisherfolks in the coastal areas of the Philippines can look forward to a brighter and safer year ahead with the development of ISDApp – the community app that allows fisherfolks to access useful weather information to help them plan their trips to the sea, even without a smartphone or an internet connection.

Developed by iNON IT Solutions and powered by Globe, ISDApp collects localized weather data, converts it to simplified weather forecasts, and sends it to the registered mobile numbers of fisher folks via scheduled daily SMS which includes the crucial hours before they go out to sea.

The launch was primarily a joint initiative between the National Fisheries Research and Development Institute (NFRDI) and Globe, with Dr. Mudjekeewis Santos, Scientist IV serving as its focal person. In partnership with the Bureau of Fisheries and Aquatic Resources (BFAR) Region IV-A, the local government of Sariaya in Quezon was then selected as the pilot community for the project which will run in the first quarter of the year.

“With the country having more than 20 typhoons and tropical depressions every year, we are hopeful that ISDApp will serve as an added tool to aid our fishermen before they set sail. The technology will inform them of the latest weather data and the timely sending of alerts can help ensure their safety,” said YolyCrisanto, Globe SVP for Corporate Communications and Chief Sustainability Officer.

To use the app, a community leader who will act as the Community Controller installs ISDApp on his/her smartphone which then generates a unique ISDApp community number. Fisherfolks in the area can then register via SMS for free and start receiving weather forecasts several times a day, a few hours before they sail to the sea.

The ISDApp weather forecast includes the date and time of forecast, a simplified explanation of the weather condition, and some tips or reminders such as:

“Kabayan, itoangtaya ng panahonngayong Dec 31, mamayang 4:00AM.

May panaka-nakang pag-ulan. Siguraduhing magdala ng raincoat o anumang pananggalang sa ulan.

Tandaan, ito ay gabay lamang para samas ligtas at masaganang pangingisda. Kung may katanungan, mag-text o tumawag saiyongI SDApp Community Leader. Ingat!”

“Kabayan, may paparating na masamang panahon. Mangyaritayo’y mag ingat lamang sa ating pagpapalaot. Tandaan, ito ay gabaylamang para sa mas ligtas at masaganangpangingisda. Kung may katanungan, mag-text o tumawag saiyong ISDApp Community Leader. Ingat!”

“Information dissemination is very important in rural areas, especially to our fishing communities. With their limited access to sources of information and resources to announce relevant advisories, ISDApp will provide weather forecasts and data in real-time which will be made accessible to underserved communities. In light of the recent typhoons, the importance of timely alerts is very apparent now more than ever,” said Regional Director Sammy Malvasof BFAR Region IV-A.

The pilot community which will use ISDApp will be a group of 300 fisherfolks from seven coastal barangays in Sariaya, Quezon.

“Napakahalagang aplikasyon para sa mga mangingisda dahil kadaapat na oras nagpapadala ito ng paalaala kung may parating na masamang panahon. Bago umalis ng bahay para lumaot, makakapaghanda ang mga mangingisda tulad ko kung ano ang dapat gawin,” said Nonilo Rate, a fisherfolk from Barangay Castaَñas.

The BFAR is the government agency responsible for the development, improvement, management and conservation of the country’s fisheries and aquatic resources.  The NFRDI meanwhile is the main research arm of BFAR of the Philippines’ Department of Agriculture. It ensures sustainable national fisheries through research and development and aims to raise the income of fishermen. It also aspires to make the Philippines one of the top five producers of fish in the world.

“The NFRDI supports this initiative of iNON and Globe to address the digital divide in rural fishing communities in the Philippines. This pioneering innovation will surely be a great help to keep our fishermen informed and safe in their fishing activities in the coming years,” added Dr. Lilian Garcia, CESO V, Acting Executive Director of NFRDI.

Both agencies will oversee the ground coordination with the Municipal Agriculture Office of Sariaya, Quezon for the pilot. Moreover, the partnership with BFAR Region IV-A and NFRDI will ensure more communities will benefit from the technology.

Department of Agriculture Undersecretary for Agri-Industrialization and for Fisheries Cheryl Marie Natividad-Caballero also lauded the development of the app, as it is aligned with the department’s vision of having a resilient and food-secured Philippines.

The developer of the app, iNON IT Solutions, became the first Filipino team to win in the NASA Space Apps Challenge in October 2018, with ISDApp as their entry. iNON was awarded as the Global Winner in the Galactic Impact category, besting four other finalists, and thousands of teams around the world. During the early stages of its development, ISDApp garnered support from the Animo Labs of DLSU and the Embassy of the United States in the Philippines. It eventually led to a partnership with Globe.

Globe supports the United Nations Sustainable Development Goals, specifically UNSDGs No. 9 and 11 which emphasize the importance of fostering innovation; and building sustainable cities and communities. Globe is committed to upholding the 10 United Nations Global Compact principles and 10 UN SDGs.

Power restored to 98% of Albay households after late-year typhoons

Electricity has been restored to 98% of households in Albay, which absorbed extensive damage from the series of typhoons that hit Luzon late last year, the National Electrification Administration (NEA) said on Friday.

In a statement Friday, the NEA said that the Albay Electric Cooperative, Inc. (ALECO) reported Thursday that it had restored power to 170,560 out of the 197,878 affected households.

ALECO said power was being restored to 2,755 households. Meanwhile, 24,563 homes were destroyed or damaged and unable to receive power.

Areas where power was fully restored are: Legazpi City, Ligao City, Camalig, Daraga, Guinobatan, Manito, Polangui, and Santo Domingo. Partial restoration was reported for Tabaco City, Rapu-Rapu, Jovellar, Oas, Pio Duran, Bacacay, Libon, Malilipot, Malinao, and Tiwi.

NEA added in the statement that power has restored to 78% or 31,591 of households in Catanduanes, according to a report from First Catanduanes Electric Cooperative, Inc. (FICELCO).

There are currently around 24,067 households in Catanduanes still without access to power. Some 8,943 households are being reconnected, while restoration is not possible for 15,124 damaged or destroyed houses.

Citing FICELCO, the NEA said that power in Pandan has been fully restored, while electricity in Viga, Caramoran, Panganiban, Virac, Bagamanoc, Bato, Baras, San Miguel, San Andres, and Gigmoto municipalities has been partially restored.

Last year, FICELCO borrowed P25 million in calamity loans from the NEA to rehabilitate its power distribution facilities which were damaged by Super Typhoon “Rolly” (international name: Goni) and Typhoon Quinta (international name: Molave).

Earlier this month, the NEA said that it handed out P128.08 million in calamity loans to electric cooperatives in 2020. The calamity loan had an interest rate of 3.25% per annum, with a 10-year repayment term and one-year grace period.

Albay and Catanduanes were among the Bicol provinces that were hit by Super Typhoon Rolly, Typhoon Ulysses and Typhoon Quinta (international names: Goni, Vamco and Quinta) last year. — Angelica Y. Yang

Shares drop as investor optimism wanes on lack of leads

LOCAL shares ended lower on Friday as investor optimism was dampened on the lack of positive catalysts and the ongoing coronavirus disease 2019 (COVID-19) pandemic.

Continuing its decline for a sixth consecutive day, the 30-member Philippine Stock Exchange index (PSEi) dropped 94.46 points or 1.32% to close at 7,045.83, while the broader all-shares index fell 39.29 points or 0.91% to end at 4,261.69.

In a mobile phone message, Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said the local bourse ended lower due to a lack of positive catalysts.

“Optimistic expectations towards the local economy is seen to be waning amid the lack of a catalyst while COVID-19 concerns continue to weigh on sentiment,” Mr. Tantiangco said.

Timson Securities, Inc. Head of Online Trading Darren Blaine T. Pangan said the market declined, together with most Asian markets, as investors were concerned about the increase in COVID-19 cases in China.

Other Asian markets were in red territory at the close of trading at the local bourse. Japan’s Nikkei 225 and Topix indices, and Hong Kong’s Hang Seng index were all in a downward trend. Meanwhile, China’s CSI 300 index was in green territory as of press time.

According to Reuters, Beijing on Friday has launched mass COVID-19 testing in some areas while Shanghai was testing all hospital staff as China faces its worst outbreak of the disease since March.

Mainland China posted 103 new COVID-19 cases on Friday, lower than the 144 cases a day earlier.

“Locally, market breadth remained negative as traders chose to take profits from a few second and third liner issues which have been trending upward for the past few days,” Mr. Pangan said.

For Regina Capital Development Corp. Head of Sales Luis A. Limlingan, the market ended lower as investors shifted their focus to the economic situation in the United States.

“Local shares were hammered down near the 7,000 psychological support as investors shifted their focus towards the US, where optimism picked up on plans of President Joe Biden to combat the pandemic,” Mr. Limlingan said in a mobile phone message.

Back home, property declined 58.49 points or 1.61% to 3,568.11; financials retreated 20.44 points or 1.39% to 1,449.12; holding firms shrank 97.28 points or 1.32% to 7,225.15; and services decreased 18.91 points or 1.21% to 1,536.13.

Meanwhile, mining and oil increased 71.62 points or 0.77% to 9,321.95, and industrials picked up 6.83 points or 0.07% to 9,175.1.

Decliners bested advancers, 117 against 104, while 39 names ended unchanged. Value turnover on Friday amounted to P11.39 billion, with 135.08 billion issues switching hands, lower than the P12.51 billion with 102.66 billion issues traded during the previous session.

Net foreign selling reached P1.42 billion, higher than the net outflows worth P995.96 million logged on Thursday.

“The bourse seems to have held the 7,000 support area this week as it coincidentally rests just around its simple moving average (SMA)-50 line. Nearest resistance still lies at the 7,300 level,” Mr. Pangan said. — Revin Mikhael D. Ochave

Gen Zs value financial independence, long-term growth when it comes to investments

Nicole Alba, a Generation-Z YouTuber with 100,000 subscribers, creates videos on personal finance, investing, and self-development. She posted her first video in May 2020, shortly after the pandemic broke out because she wanted to have something to work on during the lockdown.

“I don’t think I can speak for Gen Z as a whole, but I personally save and invest so I won’t be trapped in a 9–5 job in the future,” she said. 

The political science student had little background in personal finance growing up. A dilemma on which course to take in college led her to online resources on ways to earn money and start preparing for the future. In the beginning, she followed the advice she read about buying blue-chip stocks in the market and invested in Jollibee. 

For financial advice, she now consults Investopedia, PH Invest on Reddit, and BusinessWorld, as well as personal finance YouTubers like Graham Stephan, who became a millionaire by the time he turned 26; Andrei Jikh, who became a millionaire in one year; Meet Kevin, a 28-year-old real estate broker and investor; and Nate O’Brien, who posts videos on productivity and minimalism aside from personal finance. These YouTubers have a wide audience, with subscribers in the millions.

“For the most part, I don’t monitor what happens in the markets on a regular basis. I prefer to keep my investments simple, boring, and mostly automated,” said Ms. Alba, “so I can focus my time doing other things, like making videos for my YouTube channel and finding other ways to increase my income.”

Many who belong to her cohort (those born between 1996 and 2010), she added, are “interested in starting their own businesses online to leverage the power of Internet platforms.”

Ms. Alba’s entrepreneurial bent is representative of multiple studies that say members of Generation Z want to run their own businesses.

The Deloitte Global Millennial Survey 2020, meanwhile, found that while long-term finances are a top cause of stress, more than half of millennials, and nearly half of Gen Zs, are saving money and could cope if they unexpectedly received a large bill. The said survey also found that family, financial future, and job prospects remain the primary sources of stress of both millennials and Gen Zs, with Gen Zs being more concerned about longer-term money issues.

GET-RICH-QUICK?

Among the specific funds Ms. Alba invests in are the First Metro Philippine Equity Exchange-Traded Fund, Inc. (FMETF), a local exchange-traded fund, and the MP2 (Modified Pag-IBIG 2) Savings Fund, a savings facility with a five-year maturity designed for Home Development Mutual Fund (HDMF, or more popularly known as the Pag-IBIG Fund) members. 

“Before I decide what to invest in or what action to take, I always identify my goal first. Since I’m mostly investing for the long-term (10–15+ years), I’m able to be more aggressive in my investments and take on more risk when it comes to investing,” said Ms. Alba. 

Her YouTube subscribers who are around her age, she noted, are interested in investing and trading because they are seen as viable paths “to get rich.” Those who are new to personal finance are vulnerable to scams. “People comment on my videos and ask if [this or that business] is legit or not. I see that as a problem,” she said.

A self-learner, Ms. Alba turns to finance education websites like Investopedia, which tells you that if an advisor guarantees returns higher than 12–15%, it is likely a scam. She also warned against chain referral schemes and Ponzi schemes. “At the end of the day, it’s also a business, so ask: how do they generate revenue? How do they give back money to their investors?,” said Ms. Alba.

New app Amigo enters on-demand delivery industry

Amigo, a new player in the local on-demand delivery industry, provides parcel delivery, cash handling (a service involving the delivery of cash and payments on behalf of a customer), queuing service (a service involving lining up at an establishment on behalf of a customer to complete a delivery or claim an item), and “pasabuy” (a play on the Filipino pasabay, a term used when requesting someone to get something at a store they plan to shop in) via motorcycles. Amigo will officially launch second week of February.

Customers can book immediate or scheduled parcel delivery, and can pay a priority fee if no rider accepts their booking. Up to 20 drop-off locations can be placed for a single booking, with a route optimization feature created for such multiple drop-offs. 

Each merchant partner, meanwhile, can expect a weekly analytics report as well as a dedicated account manager to cater to their business needs and concerns. Available too is package insurance with guidelines on possible scenarios like product damage, rider cancellations, and mishandling.

Partner riders similarly have the benefit of advanced analytics plus job cards containing details such as earnings and parcel details to improve their personal delivery business. Riders are not required to sign exclusivity agreements, and are supported through onboarding and training.

“Riders are their own bosses. Everyone is accountable for their own time,” said Kimberly Siy, Amigo’s co-founder and managing director. 

To ensure privacy, riders are required to encode a one-time password (OTP) at each pick-up and drop-off location. A number masking feature will additionally be rolled out in the coming months to hide contact numbers from app users.

“I don’t think it’s bad timing to launch at the tail end of the pandemic,” said founder and president Matthew Siy Cha, replying to a question regarding the app’s unveiling. “The pandemic sped up the projection the Philippines is headed towards. What sets us apart is that Amigo recognizes every delivery should be [a happy experience] for all stakeholders, and not just for customers. We want to live up to our name and really be an amigo.”

The app will initially be available in Metro Manila, Rizal, and some parts of Cavite. — Patricia B. Mirasol

SquidPay taps MultiSys to upgrade digital platforms

Fastest-growing payment solutions provider SquidPay has tapped leading software solutions company Multisys Technologies Corporation to upgrade its existing system platforms.

SquidPay is a major shareholder of Premiere Horizon Alliance Corporation—one of the top gainers in share price among the publicly-companies in the local bourse—holding 55 percent stake in the investment holding company.

Through the partnership, MultiSys will provide its expertise in system development and integrations that will give a boost to SquidPay’s various financial services like bills payment, remittance, bank transfers, over-the-counter transactions, and SquidPay kiosk machines.

SquidPay CEO Marvin Dela Cruz said, “Since onboarding, MultiSys has only shown tangible results and hard efforts to support PHA and SquidPay. I have personally witnessed its founder David Almirol when he was just starting when he was growing; and through all those years, we’ve shared the same passion and vision. We are on the same page—the same wavelength. As we leap forward and realize our vision and goals, we cannot wait to see what lies ahead in this marriage between homegrown finance and technology.”

In December 2020, SquidPay has obtained it’s Electronic Money Issuer (EMI) license from the Bangko Sentral ng Pilipinas (BSP). The EMI license will allow the company to provide more financial services, whether online or offline, with lesser transaction fees, including money transfer, remittance, bills payment, mobile load top-up, and payment for goods and services in partner merchant stores.

Caltex surges with 11 new stations in last two months to start strong in 2021

Clean and high-quality fuels are now made available in more provinces as Caltex, marketed by Chevron Philippines Inc. (CPI), recently opened new service stations in Pampanga, Pangasinan, Bataan, Batangas, Cebu, and Bukidnon in support of the reopening of the economy. This brings the total number of newly-opened Caltex stations in 2020 to 30.

Caltex presently has a growing retail structure composed of nearly 650 retail stations across the archipelago, a figure that is expected to climb as Caltex opens more stations this year. This is a testament to the success of its retailer-owned retailer-operated business model.

CPI recently opened a Caltex service station in the municipality of Guagua, Pampanga. Situated along the Jose Abad Santos Avenue, Barangay San Antonio, this12-pump fueling station is now ready to supply fuel for motorists traveling in the area and to support the transport of forestry and fishery resources, such as rice, corn, and tilapia, which are staples in the province.

Another Caltex service station stands in the highly urbanized Olongapo City. Located along the busy stretch of Rizal Avenue, this service station now serves the fuel needs of residents in Barangay West Bajac-Bajac and its neighboring districts.

The newly-established service station in Barangay Culis, Hermosa, Bataan also serves as a vital pit stop for private and commercial vehicles traversing the Roman Highway, which is a national arterial road that straddles 10 Bataan towns.

A new18-pump Caltex fueling site also opened in Inosluban, Lipa City, Batangas and is now ready to cater to its residents and tourists. Aside from being once known as the coffee center of the world, Lipa City is also dubbed as the “Little Rome of the Philippines” for being home to many Catholic churches.

In Visayas, another Caltex station rose in San Fernando, a coastal municipality of Cebu. The area is part of Metro Cebu, which encompasses the largest domestic port in the Philippines. The fuel station’s presence in the area provides a reliable source of power for the engines of shipping and logistics vehicles operating around Metro Cebu.

The newly-opened Caltex service station in San Fernando, Cebu offers cleaner and reliable fuels for private vehicles and commercial fleets around Metro Cebu, where the largest domestic port in the country is situated.

Down south, two Caltex stations opened along the National Highway in Bukidnon, ensuring an uninterrupted journey for motorists in the area. The stations are located in the landlocked areas of BarangayAglayan, Malaybalay City, and Barangay Kisolon, Sumilao. Bukidnon is regarded as the “Food Basket of Mindanao” as it is a major producer of rice, corn, and sugarcane.

All Caltex stations carry the premium Euro 4 compliant fuel Caltex with Techron, which guarantees maximized vehicle performance, enhanced engine protection, and lower emissions. Aside from providing clean and quality fuels, Caltex also maintains strict safety protocols and offer contactless payment methods for safer travels.

“To match the Filipinos’ increasing demand for better fuel, while catering to key industries that are gradually reopening, we seek to sustain the upward trend of our retail network growth this year and onwards. We are constantly expanding our brick-and-mortar network to power a worthwhile journey for our customers wherever they are,” said CPI Country Chairman and General Manager Billy Liu.

The opening of more Caltex stations will help the local fuel industry meet the increasing demand stiffened by the country’s improving economy. According to the Asian Development Outlook 2020 Update, the Philippines’ Gross Domestic Product is forecast to grow by 6.5% in 2021.[1]

Caltex’s launch of new service stations and quality fuel products, partnerships, and latest promotions allow it to kick-start 2021 stronger and more equipped to serve the country’s fuel needs.

Motorists can find the nearest Caltex station in their area at www.caltex.com/ph/find-a-caltex-station.

[1]The Philippines’ GDP is expected to contract by 7.3% in 2020 and grow by 6.5% in 2021 – ADO 2020 Update, Asian Development Bank

DA partners with M Lhuillier to distribute cash aid to CALABARZON and Isabela agri workers

As a way of supporting Filipino agricultural workers amid the pandemic, the Department of Agriculture (DA), together with M Lhuillier Financial Services Inc. and the Development Bank of the Philippines, launched the Cash and Food Subsidy for Marginal Farmers and Fishers (CFSMFF) program in Brgy. Mayuwi, Tayabas City, Quezon last November 23, 2020.

The program aims to benefit a total of 890,794 marginal farmers, who have continuously supported the economy and the community even during this global health crisis.

“Our farmers and fishers are the greatest heroes of today and you deserve a big round of applause. Despite the pandemic, you continuously work hard and it eventually paid off,” said DA Secretary William D. Dar. The agricultural sector is the only industry in the Philippines that posted positive growth in the second quarter of 2020.

In line with its commitment to be the “Tulay ng PaMLyang Pilipino”—especially during this pandemic, M Lhuillier takes pride in being part of this program.

M Lhuillier provides a fast and convenient way for more than 81,000 agricultural workers from CALABARZON and 12,878 from Isabela to claim their P3,000 cash assistance. They just have to present their transaction code to any M Lhuillier branch near them.

With a network of over 2,500 branches nationwide, farmers and fishers don’t have to travel far just for their financial transactions.

Aside from the cash aid, farmers and fisherfolks also get P2,000 worth of food subsidies for rice, chicken, and eggs sourced from local farmers.

The CFSMFF program is part of the Bayanihan to Recover as One Act 2 by the national government, which aims to help fishers; coconut, corn, and sugarcane farmers; and indigenous people in the country.

M Lhuillier continues to be the “Tulay ng PaMLyang Pilipino” even during the COVID-19 crisis. Just head on to your nearest branch to avail of reliable financial services including KwartaPadala, Domestic and International Money Remittance, Quick Cash Loans, and Bills Payment.

Be up-to-date with the latest promos and exclusive offers by following M Lhuillier Financial Services, Inc. on Facebook. You may also visit www.mlhuillier.com for more information or call  M Lhuillier Customer Care through the toll-free number 1-800-1-0572-3252.

 

 

Nissan to end car assembly in PHL

Nissan Philippines, Inc. sold 21,751 units in 2020, which represented a 9.72% share of the local market. The company’s logo is seen at Nissan Motor’s global headquarters building in Yokohama, Japan, Dec. 17, 2018. — REUTERS/KIM KYUNG-HOON/FILE PHOTO

By Jenina P. Ibañez, Reporter

NISSAN Philippines, Inc. (NPI) will halt its assembly operations in the Philippines in March after the sales decline of its locally produced Almera vehicles, the Trade department said.

Trade Secretary Ramon M. Lopez said Nissan’s closure of its local assembly operations is proof of the need for safeguard measures on imported cars.

“Nissan in the Philippines, together with its vehicle assembly partner, Univation Motor Philippines, Inc. (UMPI), have made the decision to cease production operations for the Nissan Almera in the Santa Rosa plant in the Philippines, effective March 2021. The decision has been made following the expiration of the assembly contract between NPI and UMPI,” the company said in a statement.

Nissan’s marketing and distribution in the country will continue through imports from its Thailand and Japan manufacturing sites.

“Nissan remains committed to its investments in the Philippines. The company will continue to contribute to the growth of the Philippine automotive industry through its innovative products and excellent services, as well as its dealer expansion nationwide.”

The 133 employees working on local assembly will be laid off, Nissan confirmed in an e-mail.

Nissan said that it is working to optimize production and business operations in Southeast Asia.

The closure is part of a recent trend, after Nissan shut its plant in Indonesia last year. It also plans to close plants in Spain.

The Japanese automaker announced last year that it would cut 20% of its product lineup and annual production capacity.

Nissan registered the third-highest market share among members of the Chamber of Automotive Manufacturers of the Philippines, Inc. (CAMPI) last year, selling 21,751 units which represented a 9.72% share of the market.

But the Department of Trade and Industry (DTI) in its statement on Thursday said that Nissan Almera sales usually account for 1% of the total vehicle market. Most Nissan sales, DTI said, come from imported pickups and sport utility vehicles.

“Nissan has intimated that they already contemplated closing last year given weaker volume sales and low market share of the Almera. They have in effect extended their stay,” DTI said.

The Nissan closure follows Honda Cars Philippines, Inc. shutting its local assembly in March last year, which was attributed to rationalization done in response to a global slowdown in the automotive industry.

“The announcement of Nissan to close their assembly operations in the country is regrettable, as these developments all the more demonstrate the critical situation of the local motor vehicle industry,” Mr. Lopez said.

“Thus, the provisional safeguard measures need to be immediately put in place to protect the domestic industry from further serious injury.”

The DTI slapped safeguard duties on imported cars after its investigation confirmed a link between a surge in imports and a decline in local automotive jobs.

Automotive business groups have criticized the safeguard measures, saying that it would impede the recovery of a sector hit hard by the pandemic.

Car sales in the Philippines declined by 39.5% to 223,793 units in 2020 compared with the previous year after restrictions declared to contain the coronavirus disease 2019 (COVID-19) pandemic lowered demand, data from CAMPI and the Truck Manufacturers Association showed.

The laid off workers will be given compensation from Nissan, DTI said, adding that the Labor department will help them find manufacturing jobs.

BSP sees benign inflation until 2022

Officials have recognized the African Swine Fever continues to push pork prices higher this month. — PHILIPPINE STAR/MICHAEL VARCAS

INFLATION is expected to stay within the target range over the next two years, despite a recent uptick in global oil prices as well as food prices due to supply disruptions caused by typhoons, the central bank said.

“We do not have soaring prices so there’s no stagflation happening and we do not think that’s really a threat because the main reason is that we see inflation keeping within the target range over the policy horizon,” Bangko Sentral ng Pilipinas (BSP) Officer-in-Charge Francisco G. Dakila, Jr. said in a briefing.

The central bank expects inflation this year to average 3.2%, much higher than the 2.6% print last year. By 2021, it expects a softer headline inflation of 2.9%.

In December, the BSP maintained its 2-4% inflation target range until 2024.

The consumer price index rose 3.5% in December, marking the fastest print since the 3.8% in February 2019, due to higher food prices and transport costs.

“The latest uptick in inflation is clearly attributable to short-term considerations…. It would have happened whether [or not] we had made the policy adjustments,” Mr. Dakila said.

The central bank slashed rates by a total 200 basis points last year — with the latest rate cut done through a 25-basis-point cut in November.

Mr. Dakila noted that Region 2 (6.6%) Region 3 (4.5%), Calabarzon (4.4%) and Bicol Region (6.6%) registered the fastest annual inflation.

“What are the common characteristics of these regions? They are the regions that are most affected by the typhoons [in the latter part of last year],” Mr. Dakila said.

“The recent uptrend in inflation is seen to be largely transitory, reflecting the short-term impact of recent typhoons,” he added.

Officials have recognized the African Swine Fever outbreak continues to push pork prices higher this month.

Moving forward, Mr. Dakila said risks to the inflation trajectory remain mainly tilted to the downside due to slow recovery of demand and continued risks from the pandemic.

“However, upside inflation risks are also a possibility due to supply-side risks such as weather disturbances and rising crude oil prices,” he said. — Luz Wendy T. Noble

‘More stable’ global economy under Biden presidency to benefit Philippines

THE PHILIPPINES is likely to benefit from a more stable world economy and subdued geopolitical tensions after United States President Joseph R. Biden, Jr. took office on Wednesday.

In his inauguration speech, Mr. Biden offered a message of reconciliation, as the United States looks to restore alliances around the world (Related story on S2/8 ).

“America has been tested, and we’ve come out stronger for it. We will repair our alliances and engage with the world once again. Not to meet yesterday’s challenges, but today’s and tomorrow’s challenges. And we’ll lead, not merely by the example of our power, but by the power of our example,” Mr. Biden said.

In a Viber message to reporters, Finance Secretary Carlos G. Dominguez III highlighted this passage from the US president’s speech, saying this “bodes well for a return openness to international trade and investment and  will undoubtedly redound to our mutual benefit.”

Former President Donald J. Trump had pushed his “America First” policy, and provoked a trade war with China. Under his administration, the United States withdrew from the Paris Agreement, a global commitment to fight climate change, and the  World Health Organization (WHO).

“Adherence to multilateral agreements like the WTO (World Trade Organization), climate agreement and WHO, to mention a few, will make the world economy less risky, less volatile and more stable plus additional stimulus spending by the Biden administration will help boost global recovery. The Philippines will benefit from all these,” Finance Undersecretary and Chief Economist Gil S. Betran told BusinessWorld in a text message on Tuesday.

Reuters reported Mr. Biden issued an executive order on Wednesday to bring the United States back into the Paris accord.

Cheuk Wan Fan, the head of investment strategy and advisory for Asia at the private banking arm of Hongkong and Shanghai Banking Corp. Ltd. (HSBC), said the leadership change in the United States may ease US-China trade tensions.

“We don’t expect that a change in US leadership will bring a quick U-turn in US-China relations. However, with the expected shift of the Biden administration to a more multilateral policy approach in dealing with trade and international policies, this will reduce the risk of a sharp escalation of US-China tensions,” she said in an online briefing on Wednesday.

The HSBC executive noted the Biden administration will likely bring more predictable and market-friendly trade policies, but trade tensions between the two countries will “not be totally over.”

The United States and China are the biggest trade partners of the Philippines, with the US being the top export destination followed by China in November last year. Meanwhile, China is the country’s biggest source of imported goods, followed by Japan and the US.

Meanwhile, the Biden administration is pushing for a $1.9-trillion stimulus package to drive economic recovery.

The planned big spending by the US government will help the global economy recover faster, which will benefit the Philippines through trade and other channels, said Michael L. Ricafort, the chief economist at the Rizal Commercial Banking Corp. (RCBC) in a note on Thursday.

“However, these could be offset by divided US Senate (evenly split between the Democrats and Republicans; though any tie-breaking vote may come from US Vice President Kamala Harris) could potentially slow down the enactment of larger US stimulus, higher taxes especially on the wealthiest, and tighter regulation of some industries,” he added. — Beatrice M. Laforga

Warning signs flash as emerging markets rally to new record highs

THE MSCI Emerging Markets Index has now gained more than 9% this year — REUTERS

EMERGING-MARKET STOCKS have set a new swath of record highs this week, driven by optimism over additional US stimulus and a dovish Federal Reserve. The rally’s gaining momentum even as some technical indicators are showing a pullback is overdue.

The MSCI Emerging Markets Index has now gained more than 9% this year, extending a rebound from its low during the coronavirus sell-off in March to a heady 88%. Goldman Sachs Group, Inc., UBS Global Wealth Management and Wells Fargo Investment Institute all added to the positive chorus this week, releasing bullish calls on developing-nation equities.

“With vaccine rollouts combined with fiscal stimulus and loose monetary policy, global growth should improve and benefit emerging-market economies relatively better,” said Joshua Crabb, a senior money manager in Hong Kong at Robeco, which oversees $186 billion. “Cheaper valuations combined with better growth, a dovish Fed and a weaker dollar bode well for emerging markets over the course of 2021.”

Exchange-traded funds covering developing-nation assets drew the highest inflows in more than a year last week, with traders increasing their holdings by a combined $3.56 billion, according to data compiled by Bloomberg. That was an 11th straight week of inflows, increasing total assets to $332.1 billion, with the highest proportion of new money going to China, Taiwan and South Korea.

Emerging-market equities may reach new “historical highs” driven by better corporate profits, Goldman Sachs strategists including Kamakshya Trivedi in London and Caesar Maasry in New York wrote in a report this week. The investment bank raised its 12-month target for the MSCI equity gauge to 1,450 from 1,375. The index was at 1,413.82 on Thursday.

Corporate earnings in developing nations may rise 28% this year as companies in the developing world outperform during the global recovery, UBS Global Wealth Management’s Solita Marcelli in New York wrote in a research note this week.

For all the enthusiasm, there are some warning signs. The 14-day relative strength index for the MSCI EM equity gauge increased to 83 on Thursday, its 17th straight day above the threshold of 70 that signals to some traders gains have been excessive.

At the same time, Bloomberg’s Fear/Greed indicator, which measures selling strength versus buying strength, for the MSCI measure, has climbed to the highest level since October 2011.

While acknowledging there are warning signs, Mr. Crabb at Robeco remains confident in the long-term outlook.

“Although emerging markets have spiked recently and may see a short-term consolidation, the valuation discount to developed markets still makes EM attractive,” he said. — Bloomberg

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