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Brushing up on Italian varietals

I WAS VERY fortunate to be invited to the Borsa Vini event at the Marina Mandarin Hotel in Singapore very recently. Borsa Vini, which literally means “wine bag” in Italian, is a wine event organized by the Singaporean office of the Italian Trade Agency (ITA). Now on its second edition, Borsa Vini’s objective is to be a forum where Italian wine producers wanting to sell their wines in this region can meet with potential wine importers and distributors from domestic Singapore as well as invitees from other countries in Southeast Asia, the Philippines included. This year, 29 Italian wine producers from 10 wine regions were represented.

Italy is the world’s largest wine producer, with a 19% share of the global wine production. Italy also has the largest vineyards, with over 700,000 hectares dedicated to winemaking. With 20 major wine regions divided into an astonishing 407 Vini DOP (Wines with Protected Designation of Origin), of which 332 are DOCs (Denominazione di Origine Controllata) and 75 are DOCGs (Denominazione di Origine Controllata e Garantita), Italy has by far the most number of DOPs compared to its French and Spanish counterparts. Aside from the wine regions, Italy also has the most catalogued grape varietals or cultivars, numbering around 590, compared to Spain’s over 400 recorded varietals, and France with much less than that.

While I have been going to Italy often, especially over the last five years, there is really no way I can cover even a fraction of these 590 or so varietals. It was therefore a great blessing that I got to encounter some of these seemingly strange (for us here in Asia) varietals when I attended Borsa Vini 2019. In the past, I have written articles about Italian Rosso (Red) varietals like my favorite nebbiolo, sangiovese, corvina, barbera, and dolcetto. While for Italian Bianco (White), I covered pinot grigio, garganega, arneis, ribolla gialla, cortese, and even glera, the varietal of Prosecco. For a change, see below a small list of five Italian grape varietals I just discovered thanks to the Borsa Vini 2019

BIANCO (WHITE) VARIETALS
Passerina: A grape that is cultivated mainly in the regions of Marche and Abruzzo, but also found in other regions including Emilia Romagna and Latium. The name is derived from the Italian word for sparrow “passero,” in reference to this bird’s fondness for consuming this varietal when it is ripe. I tasted the Agronika Passerina Terre di Chieli 2018 IGT, and I find the wine more on the vegetative side, like asparagus, with some peppercorn and petal elements, but very fresh with good acidity and texture, lengthy with citrus at the end. This wine should hold up very well against cream-based food. Check this winery out at www.novaripa.com.

Vermentino: A grape widely cultivated in Sardinia but also found in Tuscan, Piedmont (where it is known as favorita), and Ligurian coastal districts (known as pigato in this area). I have tried a couple of favorita wines in Piedmont, and only found out at the Borsa Vini that these varietals, vermentino and favorita are linked together. I tasted the Pedres Thilibas Vermentino di Gallura Superiore 2018 DOCG, and this is from the province of Olbia-Tempio, north of Sardinia. This wine is a nice juicy white that is quite quaffable, with flavors that include grapefruit, lime and herbal notes, and it is nicely dry and minerally at the end. This wine can be really great with fresh seafoods. Check this winery out at www.cantinapedres.it.

Fiano minutolo: Or simply minutolo, as to not be confused with another Italian grape called fiano from Campania. Minutolo is a grape that has been cultivated in Puglia since the 13th century, but was close to extinction until a group of old vintners and oenologists revived this very aromatic varietal in the Itria Valley early this century. I was also told at Borsa Vini that only seven wineries are working with this varietal at present. I tasted the Otto Cento Minutolo 2018 IGT, and it has moscato-like characteristics. The wine has fragrant tropical fruit flavors including pineapple and lychee, has fresh acid and a nice semi-dry peppery finish. Check this winery out at www.cignomoro.it.

ROSSO (RED) VARIETALS
Nero d’Avola: A grape cultivated in Sicily, nero d’Avola is also Sicily’s best known and most planted red varietal with around 18% of the vineyards or some 14,000 hectares. This varietal is making a lot of progress in export and is becoming known for its power and bold flavors. I tasted the Cutaja Nero d’Avola Riserva 2016 DOC, and this wine has a lot going on in the glass. The nose has blackberry, earth, raisin, peppercorn, cinnamon bark and all sorts of complexity. Tannins are still rigid, but as a food wine this varietal can survive with the heartiest of any meat meals. The wine has good acid structure too and ends with a lingering bitter-sweet finish. Check this winery out at www.carusoeminini.it.

Susumaniello: This is a grape varietal that is cultivated only in the Puglia wine region. It is one of the varietals that have been around for a long time in Italy but has been under the radar. Susumaniello is also a varietal used in the Brindisi Rosso DOC wine blend. I tasted the Somiero Susmaniello del Salento 2016 IGT, and this wine has an alluring red cherry nose, some leafiness, noticeable tannins, with a medium body, and a herbaceous aftertaste. Check this winery out at www.levignedisammarco.it.

Other noteworthy Italian varietals I also encountered at Borsa Vini 2019 that are actually just named differently in Italy but are in fact commercially known varietals are: traminer aromatic, which is basically gewurztraminer; primitivo, which is closely linked to Californian zinfandel and Croatian plavac mali; and connonau, which is in fact grenache.

Right now, none of these five Italian varietals I mentioned will replace our usual chardonnay and cabernet sauvignon. However, for genuine wine lovers, these varietals offer another taste profile and a uniqueness that make the wine experience exciting, fresh, and a continuing education. I highly recommend that once you see these varietals in your favorite wine shops, please buy and try them. There is always room for new wine varietals in our vocabulary.

For comments, inquiries, wine event coverage, wine consultancy and other wine related concerns, please e-mail me at protegeinc@yahoo.com. You can also follow me on twitter at www.twitter.com/sherwinlao.

Kaspersky sees firms’ cybersecurity budgets increasing in 2020

A STUDY commissioned by Internet security firm Kaspersky said security budgets among businesses, as reported by 72% of survey respondents, including the ones in Asia and the Pacific region, will further increase in 2020.

However, almost half (46%) of cybersecurity leaders surveyed out of 305 respondents said competition with other departments in their companies for available resources is still a major concern among them.

The study noted that the figure is “almost as high as the growth and severity of attacks (49%).”

“This may seem like a paradox as security budgets continue to grow, but budget challenges come from multiple directions. Difficulty in distinguishing IT spending from security spending is the most-reported obstacle here (54% of respondents),” the study explained.

As for the security budgets, the study said: “Those budgets continue to grow: 72% of survey respondents report that their security budget will increase in the coming year.”

Kaspersky noted that security budgets among companies have grown “from 62% to 87% over the past four years.”

The study said these trends further reflect the increased priority that businesses are giving cybersecurity.

“As they increase their investment, it’s only natural that businesses seek to understand the rationale behind security decisions,” the study said.

To address company cybersecurity leaders’ concerns on funding, Kaspersky recommended that they may “shift from ad hoc communications to regular sync-ups with the business leadership team.” In this way, they will be able to keep the board “updated on the company’s security measures and remain aware of strategic priorities.”

Kaspersky also said cybersecurity leaders should speak in a language that top management understands.

“Make sure board members receive security training. This will not only help towards building a corporate-wide cybersecurity culture, but will also highlight the practical value and impact of effective cybersecurity measures,” the Internet security firm added.

Kaspersky said the survey featured “a strong global representation” encompassing 27 countries, with respondents distributed among the following regions: 160 respondents (53%) were from Europe, the Middle East and Africa; 65 (21%) were from Asia and Pacific countries; 55 (18%) were from North America, specifically the US and Canada; and 25 (9%) were from the Latin America region, including Mexico. — Arjay L. Balinbin

RCBC Bankard targets higher card issuance

RCBC BANKARD has already reached its initial target and is looking to issue more cards. — RCBCBANKARD.COM

RCBC BANKARD Services Corp. has reached its full-year target for credit card issuance and is eyeing grow its pool to breach the one million mark in second semester next year.

RCBC Bankard President and CEO Simon Javier A. Calasanz said the bank has issued around 190,000 credit cards as of end-October this year, which is already past its initial target of 150,000 for 2019.

Mr. Calasanz said the bank is now eyeing to end the year with 200,000 cards to bring its total issuance to 850,000.

“That will bring us as sixth in the industry. Our aim is to hit one million cards by the year 2020 — probably by second half of 2020 ma-reach na namin ’yung (we can reach) one million cards,” he told BusinessWorld on the sidelines of a company event last week.

RCBC’s credit card arm was able to expand its portfolio by focusing on the 20 million Filipinos that are considered bankable but have no access to credit, Mr. Calasanz said in an earlier interview.

Last July, he said the lender is targeting to issue five million cards over the next 20 years, largely expanding to the non-card debt segment.

Currently, he said the market in rural areas has been very receptive of their drive to reach the unbanked sector, adding that half of their new applications came from those in the provinces.

Mr. Calasanz admitted that the credit card industry has not been inclusive in the past as banks typically offer credit to those who have existing credit history.

“In Bankard, we believe that even at a young age, even people with smaller incomes… As long as you educate them in financial literacy, they can use credit cards responsibly — and that something that we’ve been doing over the past four years,” he said.

As the lender expands to the new-to-credit sector, he said RCBC Bankard still maintains a healthy risk tolerance as it keeps its delinquency rate at four percent and assured that it will not go beyond double-digit level.

“We’ve been doing small tests, issuing credit to people who don’t have credit and so far those tests have been going very well. So our delinquency level from this sector have been very controlled, hence now we’re expanding issuing credit to people who you would be considering unbanked before,” he said.

Mr. Calasanz said the bank is also partnering with fintech companies for faster and accurate credit scoring.

“We’re very bullish on credit card growth, we think the room for growth, like I mentioned, there’s still very huge potential because the market is only been lending to people who already have credit. We want to focus on the 20 million who don’t have credit now,” he said. — Beatrice M. Laforga

PECO ordered to explain ‘operational lapses’

THE Energy Regulatory Commission (ERC) has directed Panay Electric Co., Inc. (PECO) to explain the “apparent operational lapses” found by the agency’s inspection team and why the distribution utility should not be imposed an administrative penalty or held criminally liable for its violations.

“Based on the findings of the ERC technical team that conducted the ocular inspection on the electric distribution system of PECO, the latter committed lapses in the operations and maintenance of its distribution system thereby posing danger and risks to the lives and properties of its consumers,” said ERC Chairperson and Chief Executive Officer Agnes VST Devanadera in a statement.

In an order dated Nov. 26, 2019, ERC required PECO’s directors and officers to explain its violations of the pertinent provisions of the following: Philippine Distribution Code (PDC) 2017 Edition; Amended Distribution Services and Open Access Rules (DSOAR); Amended Elevated Metering Center (EMC) Rules; and ERC Resolution No. 12, Series of 2009, or the Guidelines for the Accreditation of Satellite Laboratories of Meter Shops.

“PECO must submit its explanation within fifteen days from receipt of the Commission’s Order pursuant to the relevant provisions of the Electric Power Industry Reform Act (EPIRA). We need to accord PECO the opportunity to explain its side before we evaluate the extent of their liability for the operational lapses that were discovered,” Ms. Devanadera said.

The ERC inspection team found that PECO’s protective devices were not properly rated and designed, and that some poles were found leaning and in unsafe positions. It also discovered that some meters were found to be clustered and installed in an elevated metering center without securing prior ERC approval.

The inspection team also uncovered that the Certificate of Authority for PECO’s meter shop expired on Nov. 18, 2019, and PECO has not filed the application for the renewal of the same. — Victor V. Saulon

Dining Out (12/05/19)

Yellow Cab’s All Star Holidays Bundle

YELLOW CAB is offering its customers the All Star Holidays Bundle featuring its bestselling dishes, from its edge-to-edge pizza to pasta and wings, all for P999. Dine on the 10-inch New York’s Finest pizza, one large serving of Charlie Chan pasta, and 10 original Hot Chix wings in one bundle that is available for dine-in, takeout, delivery, or curbside pick-up. Yellow Cab’s All-Star Holidays Bundle is available until Jan. 15. For more information, visit https://www.facebook.com/YellowCabPizzaOfficial/.

Unlimited fresh seafood

Cebu’s Isla Sugbu Seafood City is now offering Unlimited Seafood — guests choose from its wide array of fresh and live seafood, fish, shrimp, squid, crabs, or oysters, and have them cooked to their liking — fried, steamed, grilled, pan-seared, broiled, poached, or any type of cooking method. Then they can repeat the whole process until they are completely satisfied. (Note that premium items such as lobster, mudcrab, live suahe, sea mantis, and grouper are not included in the Unlimited Seafood package.) Unlimited Seafood must-tries inlude Sinigang na Salmon, Black Pepper Crab, Stir Fry Scallops, Salt and Pepper Calamari, and Salted Egg Shrimps, all these and more for P888 per head (lunch and dinner) at the Venice Grand Canal in McKinley Hills, Taguig, and P797 per head (lunch) and P848 (dinner) at the Cebu branch. Prices are exclusive of 3% service charge. For details visit www.seafoodcity.ph.

Toblerone special holiday packaging

TOBLERONE celebrtes Christmas with its limited edition Toblerone Blank Packs. With the theme “12 Days of Christmas with Toblerone,” the limited edition Toblerone Blank Packs have different personalities for the different people on one’s Christmas list. Every pack design has a specific theme and the giver can add a personal touch by writing messages. Toblerone is also holding a promo with a chance to win prizes like a trip to Japan, a shopping spree, and a new mobile phone. To join the Toblerone Christmas promo, which is ongoing until Dec. 27, buy Toblerone packs worth P100, then redeem and fill up raffle stubs at designated mall hubs nationwide (and get a chance to win a giant 4.5 kg chocolate bar). Follow the #BeMoreImaginative and #TobleroneChristmas hashtags and follow @tobleroneph on Instagram and Toblerone Pilipinas on Facebook to find out how to win the prizes. The Limited Edition Holiday Black Packsare available in 100g (P106), 200g (P206) and 360g (P400) sizes.

Apple fails to end MacBook ‘butterfly’ keyboard class action

A FEDERAL judge on Monday rejected Apple Inc.’s bid to dismiss a proposed class action lawsuit by customers who said it knew and concealed how the “butterfly” keyboards on its MacBook laptop computers were prone to failure.

US District Judge Edward Davila in San Jose, California said Apple must face claims that its troubleshooting program did not provide an “effective fix” for MacBook design defects, or fully compensate customers for their out-of-pocket expenses while seeking repairs.

Customers claimed that their MacBook, MacBook Pro and MacBook Air laptop keyboards suffered from sticky keys, unresponsive keys and keystrokes that failed to register when tiny amounts of dust or debris accumulated under or near keys.

They also said Apple’s service program was inadequate because the Cupertino, California-based company often provided replacement keyboards that had the same problems.

The lawsuit covers purchasers of model year 2015 or later MacBook laptops, and model year 2016 or later MacBook Pros laptops. It seeks a variety of damages for violations of several states’ consumer protection laws.

Apple did not immediately respond to requests for comment. Benjamin Johns, a lawyer for the plaintiffs, said he was pleased with the decision and looked forward to pursuing the case.

Last month, Apple introduced a MacBook Pro with a larger screen and new “Magic” keyboard with the “scissor” mechanism more commonly found in the industry. The hinged butterfly mechanism resembles a butterfly’s wings.

The case is In re: MacBook Keyboard Litigation, US District Court, Northern District of California, No. 18-02813. — Reuters

Australian fund managers are already betting on quantitative easing

AUSTRALIAN asset managers are gearing up for what was once unthinkable: the prospect of quantitative easing (QE) in their own backyard.

They’ve pored over the lessons from overseas and arrived at a different conclusion to central bank chief Philip Lowe, who has sought to damp expectations that QE is likely in Australia.

Some including QIC Ltd. and Nikko Asset Management Ltd. are already buying assets on bets that interest-rate cuts won’t be enough to combat slowing economic growth. They see the impact of asset purchases rippling broadly through debt markets, even if Lowe manages to limit any QE program to government bonds.

“QE could come even before any recession,” said Susan Buckley, QIC’s managing director for global liquid strategies, who is overweight Australian credit. Unorthodox monetary policy “is definitely a scenario we have to prepare for. Everyone’s talking about QE.”

The Reserve Bank of Australia (RBA) has cut interest rates three times since June, to a record low 0.75%, amid a slide in economic growth to the slowest pace in a decade.

Mr. Lowe has said in a speech on Nov. 26 that rates would need to go to 0.25% before he’d consider QE, and that even then, the hurdle to asset purchases would be high. He also signaled that the RBA would have little appetite for buying private-sector assets.

But with unemployment that’s too high to drive up wages and tepid gains in consumer prices, investors expect Mr. Lowe to be pushed outside his comfort zone. Many of them were right in positioning for the recent run of rate cuts. The RBA stood pat on Tuesday.

“Look across the developed world and if you can show me a country that’s averaged 2.5% inflation over the past 10 years then you’re doing a better job than me,” said Chris Rands, portfolio manager at Nikko Asset, who is loading up on semi-government bonds. “Why would Australia be the country that achieves that when no one else has?”

Here’s how some fund managers are preparing for QE:

LONG BONDS
Australian sovereign bond yields are likely to fall across the curve as the RBA steps in as a default purchaser, said Raymond Lee, money manager at Kapstream Capital, a unit of Janus Henderson Investors. That makes government bonds a fairly compelling buy for the A$14-billion ($9.6-billion) fund.

“We’ve increased our duration at the beginning of this year, just because we felt that rates were going to stay lower for longer,” said Sydney-based Mr. Lee. While QE might still be “a while away, RBA comments on unconventional policy only confirms the fact that rates are going to stay low and could rally further.”

The central bank may buy up to A$50 billion of Australian government bonds as part of a QE package as early as next year, according to JPMorgan Chase & Co.

Stuart Dear, deputy head of fixed-income at Schroder Investment Management Australia Ltd., is also positive on Australian sovereign debt. He expects bonds with maturities shorter than five years to outperform if the RBA embarks on QE.

SEMIS BET
Nikko Asset started buying Australian dollar-denominated semi-government debt last year, wagering notes maturing in a decade were priced attractively.

It’s been a profitable trade. Yield spreads of quasi-government debt have narrowed against their sovereign counterparts.

“We can look at the US experience for this, where even though they bought government bonds there, other assets all got supported,” Mr. Rands said. “It’s likely to be the same in Australia, as QE gives semis an extra kick.”

Schroders’ Mr. Dear has also boosted holdings of semi-government securities.

“We have increased our exposures by buying semi-government bonds and residential mortgage-backed securities,” he said. “This buying came ahead of Lowe’s speech, which has broadly affirmed our views.”

CREDIT BOOST
Others including QIC’s Ms. Buckley see Australian corporate bonds gaining, even if the RBA’s initial focus is on government debt.

She sees unconventional stimulus as likely to “float all boats.”

On top of this, the RBA could run out of sovereign bonds to buy. Mr. Lowe has noted that the gross stock of government debt is projected to decline over the years ahead. And the biggest owners of the bonds — domestic banks and foreign central banks — are long-term holders who may not be willing to sell in large quantities.

While rising risks of a recession or economic slowdown would normally see the A$85-billion money manager shed some of its credit exposure, Brisbane-based QIC is taking a new tack.

“We’ve seen this play out in the UK, Europe where spreads have compressed as a result of ECB (European Central Bank) purchases, and it could happen here as investors push out the credit spectrum as risk-free rates fall,” Ms. Buckley said.

SHORT AUSSIE
For those scouting for a more liquid way to trade Aussie QE, shorting the nation’s currency presents the best avenue, said Stephen Miller, adviser at GSFM, a unit of Canada’s CI Financial Group.

“If QE is coming, the Australian dollar will look sick and likely get sicker,” Sydney-based Mr. Miller said. “It’s a good short if you’re looking to war game quantitative easing, and right now, I’d say a target of around 65 US cents is achievable.”

The Aussie has weakened about 3% against the greenback this year and touched a decade-low of 66.71 US cents in October as traders priced in fresh interest-rate cuts.

Australia’s economic growth slowed to 0.4% in the third quarter from the previous three months, slightly less than economists forecast, according to data released Wednesday.

The nation’s biggest pension fund, AustralianSuper Pty., is underweight the Aussie and long sovereign paper on bets the RBA may unleash QE as early as next year.

The central bank is likely to push rates to as close as zero as they think they can without damaging the banking system, according to Carl Astorri, head of asset allocation and research at the A$175-billion fund. “That process would flatten the yield curve and push the currency down,” he said.

TIMING QE
To be sure, no market participant can say for certain when and how QE will finally be deployed.

Recovering real estate prices may spur a housing-related consumption rebound, helping the RBA stay its hand on unconventional policies next year, according to Goldman Sachs Group, Inc.

Citigroup, Inc. reversed its call for stimulus in 2020, forecasting just one more RBA rate cut before the central bank keeps rates on hold. Barclays Bank Plc predicts QE is unlikely as Australia’s economy heads towards a “gentle turning point.”

For some, it’s still better to be safe than sorry.

“There are several steps before the RBA gets to QE, but if they need to act further down the track, they likely will,” said GSFM’s Miller. “I’m not surprised some think now might be the time to start buying assets.” — Bloomberg

How PSEi member stocks performed — December 4, 2019

Here’s a quick glance at how PSEi stocks fared on Wednesday, December 4, 2019.

 

Lacson proposes more UHC, National ID funding

SENATOR Panfilo M. Lacson said he proposed budget amendments providing for additional funding for the Philippine Identification System (PhilSys) program, Universal Health Care (UHC), and free university tuition.

In documents posted to his website, Mr. Lacson outlined his proposed amendments to the Senate Finance Committee, noting that the key programs have been allocated insufficient funds in the P4.1 trillion 2020 budget. The two chambers’ budget bills are currently being harmonized in bicameral session with a ratification target of next week.

Mr. Lacson proposed to increase the budget of the Philippine Statistics Authority (PSA) to P7.009 billion from P1.364 billion, citing the insufficient allocation for Philsys, or the National ID program, of P2.4 billion.

He said the estimated cost to provide IDs to an initial 14 million Filipinos is P5.7 billion, more than double the budgeted funds.

The National ID is intended to increase financial inclusiveness by giving those without bank accounts access to an ID acceptable to all banks. A more secure ID is also expected to reduce benefits fraud in cash transfers to the poor and possibly ease the implementation of Universal Health Care (UHC).

“The funding gap will significantly hamper our annual implementation targets and fundamentally, our aim to achieve universal coverage,” Mr. Lacson said.

Mr. Lacson also proposed to increase the budget of the Commission on Higher Education (CHEd) by P2 billion to P45.88 billion. The increase will fund the Tertiary Education Subsidy.

He proposed to increase the Department of Health’s (DoH) budget by P3 billion, with P1 billion to support the Health Facilities Enhancement Program, and P2 billion for the Human Resource for Health program.

“One of the key programs under the UHC is the Health Facilities Enhancement Program where appropriations significantly decreased from P15.92 billion under the 2019 GAA (General Appropriations Act) to a mere P5.9 billion under the NEP National Expenditure Plan) 2020.”

To fund the increased program budgets, Mr. Lacson proposed to reduce the funding for the Department of Transportation (DoTr) and Department of Public Works and Highways (DPWH), among others.

The DoTr budget for Right-of-Way Acquisition was reduced by half to P5 billion, while P15 billion was slashed from the DPWH ROW appropriations.

Mr. Lacson said as of Oct. 31, the DoTr has only obligated P1.2 billion of P13.26 billion budget for ROW payments. “Considering that huge unused appropriations will be carried over next year, it is inefficient to provide substantial funding for ROW,” he said.

He said the DPWH’s average unused appropriations from 2011 to 2018 was P82.4 billion.

The chambers of Congress are working to submit the budget to President Rodrigo R. Duterte for signing before the year ends and avoid a repeat of the four-month delay in the 2019 budget, which has been blamed for dampening economic growth in early 2019. — Charmaine A. Tadalan

Dominguez, Pernia due in Tokyo to discuss progress of key Japan-backed infrastructure projects

THE government’s economic team will meet Japanese officials this week in Hakone, southwest of Tokyo, to discuss the progress of big-ticket infrastructure projects supported by Japan.

Finance Secretary Carlos G. Dominguez III and Socioeconomic Planning Secretary Ernesto M. Pernia will represent the Philippines Friday during the ninth high-level meeting of the Philippines-Japan Joint Committee on Infrastructure Development and Economic Cooperation.

Meanwhile, the Japanese delegation will be led by Hiroto Izumi, special advisor to the Prime Minister.

Mr. Dominguez said in a statement Wednesday that the two countries regularly meet to ensure a “fast and sure” approach in implementing the Japan-funded projects under the “Build, Build, Build” program.

The two sides met in Clark earlier this year while the very first meeting was held in March 2017 in Tokyo.

In an interview on Wednesday, Mr. Pernia said that the meeting will assess ongoing projects “to see how they are moving, if there is any need for midway adjustments and also to look at the projects in the pipeline that will be ready for implementation.”

Mr. Pernia said that the two countries will ensure that ongoing projects are delivered sooner than later. The pace of implementation will also be discussed to see if there is a need for an “additional push.”

Asked if new agreements will be signed, he told BusinessWorld: “so far, there’s nothing that has been scheduled but it’s possible that need for new loans may just crop up and the Japanese side may just be willing to accommodate.”

Since President Rodrigo R. Duterte assumed office in June 2016, the two sides have signed 10 loan agreements in total, Mr. Dominguez said. He added that these loans were processed and approved in a span of three to four months.

As of December, Japan was the top source of official development assistance (ODA) loans and grants.

Japan accounts for 46% of the country’s total ODA loan portfolio.

Japan was also the country’s second-largest trading partner in 2018 with two-way trade of $21.1 billion. It was the second-largest export market with shipments worth $10.3 billion, and the third-largest source of imports worth $10.82 billion.

Japan was the fourth-largest source of visitors with 631,000 in 2018, up 8.15% from a year earlier.

The country’s 10 loan agreements with Japan fund the second phase of the Maritime Safety Capability Improvement Project for the Philippine Coast Guard; the “Harnessing Agribusiness Opportunities through Robust and Vibrant Entrepreneurship Supportive of Peaceful Transformation” project; the Cavite Industrial Area Flood Risk Management project; the third phase of the Arterial Road Bypass project in Bulacan; the New Bohol Airport Construction and Sustainable Environment Protection project (II); the Metro Rail Transit Line 3 Rehabilitation project and the fourth phase of the Pasig-Marikina River Channel Improvement project.

The three other agreements were the first tranche of the North-South Commuter Railway Extension project loan, the Road Network Development project in conflict-affected areas in Mindanao, as well as the first phase of the Metro Manila Subway project, which is the single biggest venture under the “Build, Build, Build” program according to the statement issued by the Department of Finance. — Beatrice M. Laforga

DTI sets Feb. deadline for Thailand to comply with WTO tobacco ruling

THE Department of Trade and Industry (DTI) said it is giving Thailand until February to comply with the World Trade Organization (WTO) ruling on its customs measures on Philippine cigarette exports before seeking recourse.

Trade Secretary Ramon M. Lopez told reporters after a news conference at New World Makati Hotel Wednesday that he will write a letter to his counterpart in Thailand this month.

“The general tone is for enjoining them to comply with the WTO ruling. We are all supposed to subscribe to the rules. It’s as basic as that. Otherwise, we will look into recourse, into other measures that will be available for us to take,” he said.

The decade-long dispute on Thailand’s fiscal and customs policies on imported cigarettes from the Philippines, where the WTO ruled in favor of the Philippines, is now facing new considerations that could delay Philippine retaliation.

The Thai courts recently fined Philip Morris Thailand $39.7 million after finding the company had undervalued cigarette imports from the Philippines to avoid taxes.

“We are looking closely at the details of that trade court’s decision,” undersecretary Ceferino S. Rodolfo said in the briefing, noting that DTI is now waiting for the official English translation of the decision.

“There was a positive finding with respect to the fines that will be imposed on the Thai importer of Philippine products. In effect, the Thai court decision disregarded [the] WTO case.”

He said that the decision works against the WTO ruling that favors the Philippines. DTI is currently working on communicating with the WTO through the Philippine Mission in Geneva.

The appellate body of the WTO may also not have enough members to function after Dec. 10, following the blocking of appointments from the Trump administration.

“We’re also looking carefully at what will happen to the appellate body of the WTO, because that will also have a material impact on the timelines as to whether Philippines can impose certain actions,” Mr. Rodolfo said.

DTI last month said that it was considering cross-sectoral retaliation against Thailand by the end of December, looking into imposing tariffs or quantitative restrictions on its automotive exports to the Philippines.

Mr. Lopez said Thailand is in the “ASEAN brotherhood of trade partners,” and offered the country a chance to comply with the WTO ruling.

Tumagal na ‘yung kaso ng 2011 or 2012. (The case has been going on since 2011 or 2012). We’re willing to wait a little more,” he said.

Mr. Rodolfo said that the DTI is looking after the interests of tobacco farmers.

“The Secretary wants to fight for this case — in addition to the Philippine exporters to Thailand, it’s because of the [tobacco] farmers that have been prejudiced by this case.” — Jenina P. Ibañez

PHL among top 5 ‘greenfield’ FDI destinations in Asia

THE Philippines received the fifth-most “greenfield” foreign direct investment (FDI) in the Asia-Pacific, the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) said in a report.

Greenfield investment refers to new projects, as opposed to the expansion of existing projects.

The Foreign Direct Investment Trends and Outlook in Asia and The Pacific 2019/2020 report found that the Asia Pacific for the first time became the largest source and destination for FDI globally.

In 2018, the region attracted 45% of FDI inflows worldwide, and was the source of 52% of outflows.

Greenfield investment into the Asia Pacific is expected to see sluggish growth in 2019, ESCAP said.

“A decline in investment flows in 2020 is expected if the uncertainty related to international trade continues and companies continue to consolidate their value chains.”

The report said that investment prospects for the region are subdued due to the UK’s possible exit from the European Union, the US-China trade war, protectionism, and civil unrest in Hong Kong.

Global FDI flows dropped 13% to $1.3 trillion in 2018.

FDI into the Philippines fell 26% to $6.5 billion in 2018, the largest decline in Southeast Asia.

Rizal Commercial Banking Corp. economist Michael L. Ricafort in an e-mail said that a decline in 2018 FDI was due to a sharp increase in inflation and interest rates, though he called the Philippines a still-attractive destination for FDI amid improved economic and credit fundamentals in recent years.

“Net FDI inflows into the Philippines could pick up/improve especially if both local economic growth and global economic growth improve amid relatively lower interest rates and inflation recently.”

“Any partial/phase one trade deal between the US and China… could fundamentally lead to higher FDIs worldwide.”

ING Bank N.V. Manila senior economist Nicholas Antonio T. Mapa in an e-mail said that in 2019, companies that had previously set up shop in the Philippines continue to plow back their earnings into the country.

“This shows that corporates who are here realize the growth potential of the PHL and view market conditions to be favorable enough to put in more money as opposed to remitting all their earnings back to their mother companies.”

He said that newer FDI has struggled as investors are anxious about tax reform uncertainty.

“Taxes will be lowered but would-be investors are unsure as to how quickly and by how much… the actual list of fiscal incentives, which could be beneficial to the business investment decisions of these corporates, is also not set in stone just yet,” he said.

“Thus, we see a lot of investors waiting on the sidelines before they can actually do their feasibility studies to determine if they should invest, and if they should, by how much.” — Jenina P. Ibañez