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Welcoming 2021 at The Pen

AFTER the events of 2020, the new year can only be met with open arms. The Peninsula Manila — known for its New Year’s celebrations — suggests welcoming the new year with family in a manner that is both safe and joyful. While eschewing the grand party of yesteryears, the hotel’s celebration is no less special this year. Over at The Lobby, there will be a New Year’s Eve Six-course Set Dinner Menu (P6,500 for adults; P3,000 for children under 12) served between 8:30 p.m. and midnight, with the  Peninsula Strings and Peninsula Jazz Quartet performing throughout. Over at Escolta, a New Year’s Eve Dinner Buffet (P6,000 with free-flowing wine; P4,500 for adults; P2,200 for children under 12) will be served, with seatings at 6:30 and 8:30 p.m. Escolta’s special buffet menu will include salads, Italian antipasti, ripe cheeses, fresh sushi, pasta, holiday hot and cold main course specialties, a carving station with all the condiments and a dessert selection. On New Year’s Eve, Spices offers an Asian-inspired a la carte dinner menu amidst the serene setting of a koi pond and the outdoor pool. The a la carte lunch and dinner will be served at 11:30 a.m. to 2:30 p.m., 6 to 11 p.m., with minimum consumption of P2,300 for adults and P1,100 for children under 12. For an even more special celebration, the hotel offers the New Year’s Eve Revelry Room Package which includes an antigen test for two, a six-course set dinner menu for two at The Lobby on Dec. 31, a set breakfast for two adults and two children five years old and below at The Lobby, and complimentary use of hotel’s Fitness Center facilities and outdoor swimming pool (rates start at P23,000 for a Deluxe Room). The hotel also offers a New Year’s Eve Stay-and-Dine in Escolta Room Package which also includes two antigen tests, a buffet meal at Escolta on New Year’s Eve, set breakfast for two adults and two children five years old and below at The Lobby, among others (room rates start at P19,000 for a Deluxe Room). For inquiries and reservations, call 8887-2888, or e-mail diningpmn@peninsula.com (Food and Beverage) and reservationpmn@peninsula.com (Room Reservations).

Humanizing healthcare through design and technology

By Patricia Mirasol

Design creates value across the different life stages. Experts talked about how healthcare can be humanized with design and technology at the recent Business of Design Week (BODW) event.

“If you pull out your smartphone and type in the word ‘designer’ on any SMS application, you get an image that looks like a yellow French person from the 1940s holding a paintbrush. Designers do more than that,” said Rama Gheerawo, director of The Helen Hamlyn Centre for Design of the Royal College of Art (RCA). “Design is a process. We have frameworks, strategies, and processes that help design deploy itself creatively into human life.” 

In his talk, Mr. Gheerawo presented four design considerations in the context of healthcare, the first of which is being human. Humans move to hospital wards – spaces that are radically different from the homes they grow old in – as they age. He explained that at Hong Kong Polytechnic University, they rethought the care home to make it a place people would want to stay in, as opposed to a space given at the end of one’s life. This rethinking included changing the existing color palette, typically the color of body fluids, into a cheerful one. An additional example brought up was the replacement of white plates with blue ones in another care home so the elderly could see the white food that was being served. (The aforementioned care home initially thought that the residents had given up on life because they weren’t eating.)

“You shouldn’t design anything you wouldn’t use yourself,” he added. 

A second consideration is bringing humanity into technology. A web service called SloMo was created at the King’s College in London as a digital intervention for those with psychosis. Mr. Gheerawo said that they later realized the service was also useful for everyone who has ever experienced stress and needs to slow down for a moment.

The other considerations involve making every conversation better and putting people first. Mr. Gheerawo advised working with some of the 7.6 billion inhabitants of earth that have health concerns instead of relying on marketing stereotypes when designing solutions.

“Healthcare will shift from the hospital to the home, and design can play a role in enabling that,” he told the BODW audience. “We need to work with big data numbers, but we also need to have a deep understanding [of that data]. Numbers give you big data. People give you deep data.”

ASKING KEY QUESTIONS
Larry Keeley, an innovation scientist and author of the Ten Types of Innovation, also conveyed the importance of thinking about the human first. In a world where remote diagnostics, artificial intelligence, and the real-time processing of sensors are a reality, he proposed paying attention to the following: how overall population health is functioning; how global health norms are shifting; and which innovations are making the difference in diagnostics and treatments.

He proposed figuring out how healthcare can be made affordable too. “If you don’t find new ways to pay for this and make it affordable and seamless – specifically to change people’s behaviors, rather than only investing in costly care when they have difficulties – it will sink [into] most thoughtful governments in the ways in which they’re addressing things,” added Mr. Keeley. 

Students of design should consider the issues that drive a longer and healthier life, and produce things that make the biggest difference. As health moves steadily into smarter homes, Mr. Keeley said that human needs must be met by design efforts that incorporate how human beings live.

After property scandal, Pope tightens money controls

VATICAN CITY – Pope Francis has issued a new decree making charity funds more transparent and tightening controls on Vatican finances after a scandal over a luxury London property deal.

The main target is the Secretariat of State, the most important part of the Vatican administration, which must relinquish management of its funds, investments and real estate and submit to supervision by two other economic offices.

Published on Monday and signed by the pope on Dec. 26, the decree takes effect over two months from Jan. 1.

In 2014, the Secretariat invested about 200 million euros ($244 million) as a partner in a deal to buy a luxury building in London. As the deal became onerous, it paid tens of millions of fees to middlemen in attempts to change the terms.

Cardinal George Pell, the Vatican’s former treasurer, told Reuters earlier this month there had been “enormous losses”. . In September, the pope fired Cardinal Angelo Becciu, a former top Secretariat official.

An investigation into the London deal led to the suspension last year of five Vatican employees, four from the Secretariat. The Vatican has also accused the middlemen of extortion.

‘PETER’S PENCE’

The Secretariat of State’s assets are being transferred to a department called Administration of the Patrimony of the Holy See (APSA) and will be overseen by the Secretariat for the Economy.

The Secretariat of State also loses control of “Peter’s Pence”, a fund which the faithful can contribute to and is aimed at helping the pope run the Church and finance his charities.

In past years, the Vatican has dipped into Peter’s Pence to cover budget deficits. The fund’s reputation has suffered from reports it may have been used for questionable investments, such as the London building.

The decree sets up three new accounts – one for Peter’s Pence, another for a “Papal Discretionary Fund”, and a third to hold funds which donors want used for a specific purpose. To guarantee transparency, they will become part of the Vatican’s budget, the pope said in the decree.

A Vatican statement said the changes to Peter’s Pence were meant to reassure donors that contributions were properly used. — REUTERS

COVID SCIENCE – UK variant linked to high viral loads, Neanderthal gene offers protection

The following is a roundup of some of the latest scientific studies on the novel coronavirus and efforts to find treatments and vaccines for COVID-19, the illness caused by the virus.

UK coronavirus variant associated with higher viral loads

The highly infectious COVID-19 coronavirus variant that has been circulating in Britain is linked to higher loads of the virus in the blood, according to a research report published on medRxiv on Sunday ahead of peer review. Around 35% of patients infected by the variant form had very high levels of the virus in their samples, compared to 10% of patients without the variant, study leader Michael Kidd of Public Health England and Birmingham University told Reuters. Higher viral loads have been linked with worse COVID-19 outcomes. The tests were conducted at the Birmingham Turnkey Lab. Kidd said additional study was needed to confirm or refute the findings. If confirmed, he hopes scientists will investigate how this particular variant manages to make more copies of itself in infected patients.

Neanderthal gene protects against COVID-19

A specific form of a protein passed down from Neanderthals protects against severe COVID-19, and medications that boost levels of this protein could potentially help treat the disease, according to a study reported on medRxiv on Thursday ahead of peer review. The protein, called OAS1, is involved in the body’s response to viruses. People with higher levels of the Neanderthal-related form of OAS1 are less susceptible to COVID-19, and if they do become infected, they are at lower risk for hospitalization, intubation and death, the researchers found. “This protective form of OAS1 is present in sub-Saharan Africans but was lost when the ancestors of modern-day Europeans migrated out of Africa. It was then re-introduced into the European population through mating with Neanderthals” who lived more than 40,000 years ago, said coauthor Brent Richards from the Jewish General Hospital and McGill University in Montreal. An earlier study linked a cluster of genes inherited from Neanderthals to higher risks of hospitalization from COVID-19. “These findings further implicate Neanderthal ancestry in COVID-19 severity,” Richards said.

Early antibody production key to COVID-19 recovery

The speed of patients’ antibody production – rather than the volume of antibodies they produce to fight the new coronavirus – determines whether they will survive COVID-19, new data suggest. Researchers who studied more than 200 COVID-19 patients, including 179 who were hospitalized, found those who produced so-called neutralizing antibodies within 14 days of developing symptoms eventually recovered, while those who did not produce neutralizing antibodies until more than 14 days had elapsed developed higher viral loads and more severe disease. “It is unclear why antibodies generated after this time point are unable to promote viral clearance and recovery in COVID-19 patients,” the researchers said in a report posted on medRxiv ahead of peer review. Study leader Akiko Iwasaki of the Yale University School of Medicine tweeted on Saturday, “It’s possible that virus somehow becomes resistant by hiding in inaccessible tissues.” The new findings, she added, suggest therapy with so-called monoclonal antibody drugs – such as those from Regeneron given to U.S. President Donald Trump — is likely to work only if used soon after infection. — REUTERS

S.Korea sets $8.5 bln package to fight new coronavirus wave – finmin

SEOUL – South Korea unveiled a fresh 9.3 trillion won ($8.49 billion) package on Tuesday to support small businesses hit by a third wave of coronavirus and those vulnerable to unemployment due to the outbreak.

Of the total package, 5.6 trillion won will be used to fund cash handouts to coronavirus-struck small businesses, temporary or freelance workers and taxi drivers affected by the prolonged pandemic, the finance ministry said.

Some 2.9 trillion won will be used to support small and medium-sized businesses including ski resorts and hotels, which received damage from the government’s year-end special COVID-19 regulations, and to keep more Koreans in jobs.

The South Korean government has added new restrictions this week such as banning on gatherings of more than four people and suspending ski resorts and tourist sports, aimed at stopping the virus spread during Christmas and New Year holidays.

Another 0.8 trillion won is aimed at strengthening the public health system.

The ministry said the cash handouts will be offered starting from Jan. 11, and expects that the latest measures could help around a total 5.8 million people.

On Monday, the country vowed to speed up efforts to launch a coronavirus vaccination programme as it continued to report near-record daily cases and discovered its first cases of the coronavirus variant linked to Britain.

Meanwhile, the $8.5 billion package will be funded by the finance ministry’s reserve fund, leftover budget for the year as well as 2021 budget, the ministry said in a statement. — REUTERS

Thais Dipping Into Gold Savings Undermine Steps to Rein in Baht

Gold sales in Thailand are surging as households reach for a financial lifeline amid the pandemic, a tactic that risks complicating government efforts to tame an export-stifling rally in the nation’s currency.

Exports of the precious metal surged to a record this year as prices climbed and Thais unloaded jewelry, bars and medallions to raise cash for routine expenses. Bullion traders expect the trend to continue into 2021 as the coronavirus drags on tourism and manufacturing, the mainstays of Thailand’s economy.

“Gold is easier to sell than land or condominiums,” said Pawan Nawawattanasub, chief executive officer of YLG Bullion International, one of Thailand’s top gold traders. “Thai people still have high stockpiles of gold, as the nation has been more of a net importer than exporter in the past.

Quick cash from more than 1,800 gold shops across the nation has been one of the most common ways Thais have weathered the economic downturn, in addition to taking out short-term loans, skipping debt payments and finding second jobs.

As a result, gold exports jumped to 237.4 metric tons during January-October, compared with 170 tons for all of 2019, official data show. Net exports of 135 tons during the first 10 months of this year are the highest since at least 2010, according to Ministry of Commerce figures.

Gold Out, Dollars In

Those gold shipments, however, are widening Thailand’s current-account surplus, helping drive gains in the baht that threaten a fragile economic recovery. The baht has rallied more than 9% from its low in April, a surge also due to U.S. dollar weakness, while gold is up 25% this year after hitting a record in August.

The central bank is seeking to encourage more gold trading using foreign-currency deposits, an attempt to shield the baht from swings in sales of the precious metal when prices spike. The first such program, a venture between Bangkok Bank Pcl and gold marketplace Hua Seng Heng, started this month. The Bank of Thailand didn’t respond to an emailed request for comment.

“Baht strength will stay with us, as it comes from structural problems” such as a high current-account surplus and low investment, according to Somprawin Manprasert, chief economist at Bank of Ayudhya Pcl. “The planned steps on gold may help curb volatility only in the long term.”

Southeast Asia’s second-biggest economy is expected to rebound 3.2% in 2021 after this year’s 6.6% contraction, according to Bank of Thailand projections. With interest rates already at a record low, the central bank has turned its attention to the baht’s rapid rally, labeling it a risk to exports. It unveiled a raft of measures to encourage capital outflows to cool the currency, a task complicated as a weak U.S. dollar sparks fund flows into emerging markets globally.

The Bank of Thailand has seen its foreign exchange reserves jump by almost $100 billion in the past five years to a record $257 billion, or about 47% of gross domestic product, mainly from efforts to stem baht appreciation. That’s caught the attention of the U.S., which earlier this month added Thailand to a watch list of potential currency manipulators.

While a vaccine is being rolled out globally, the pandemic will likely continue to drive up poverty and unemployment rates in the near term. That means Thais are expected to continue selling gold next year, according to MTS Gold Group, a bullion exporter.

Suvirat Namvicha, 22, a Bangkok office worker, sold a gold necklace last month to pay medical bills and other expenses related to her pregnancy after her employer slashed overtime allowances.

“I need money to pay my bills, and selling gold is my best option,” Suvirat said. “I may need to sell my last gold necklace after my baby is born. Looking ahead, I only see rising expenses with limited income.” — Bloomberg

China’s Struggling to Get the World to Trust Its Vaccines

Of all the developing countries testing China’s Covid-19 vaccines, few are friendlier to Beijing than Pakistan. In the years leading up to the pandemic, China financed nearly $70 billion across the South Asian nation on roads, railways and power stations, and Pakistan now has two Chinese clinical trials underway, with even senior government officials being inoculated.

Yet interviews with people in Karachi, the nation’s biggest city — as well as in other developing nations from Indonesia to Brazil, together with surveys and official comments — show that China has failed to assure the millions of people who may have to rely on its vaccines.

“I won’t take it,” said Farman Ali Shah, a motorcycle driver in Karachi for local ride-hailing app Bykea, as local shops closed early ahead of an 8 p.m. virus-induced curfew. “I don’t trust it.”

That mistrust, and the reliance of dozens of poorer nations on China to inoculate their populations could set the stage for a major global political headache if citizens offered the Chinese vaccine feel they are being given an inferior product.

China’s vaccines were meant to score a clear diplomatic win for Beijing, shoring up ties with dozens of poorer nations amid an anticipated shortage of Western-developed shots. But there has been little information about how the Chinese versions have fared in final-stage clinical trials, with just the United Arab Emirates and China itself endorsing the vaccines for emergency use so far. Meanwhile, some U.S. and European companies have published data on the safety and efficacy of their shots and started to deploy them.

That uncertainty presents another roadblock in China’s efforts to extend its political influence across Asia, Africa and South America. Through its seven-year-old Belt and Road Initiative, Beijing spent billions on loans and projects and cultivated local elites to buttress its political and economic power — efforts that have often backfired because of poor management and heavy-handed implementation. The mistrust was compounded by China’s exports early in the pandemic of subpar tests and personal protective equipment.

“China has a great opportunity to do vaccine diplomacy and distribute a life-saving product,” said Jorge Guajardo, a senior director for McLarty Associates, who was Mexico’s ambassador to China for six years. “In my experience, every time they’ve engaged in diplomacy, they screw it up — they manage to upset the countries on the receiving end of their aid.”

Missteps could undermine President Xi Jinping’s claims that China’s ruling Communist Party has handled the virus better than western democracies. China, which saw the first known cases of Covid-19 a year ago, used its authoritarian system to virtually eliminate the virus, mass testing millions of people when cases emerged, shutting its borders and locking down parts of the country to snuff out infections. That approach has seen China’s economy begin to recover even as countries such as the U.S. and U.K. struggle to control outbreaks.

Bolstered by its virus success, Beijing sparred with the U.S., U.K. and Australia over everything from the origins of the virus to crackdowns in Hong Kong and Xinjiang. The pain of the pandemic also hardened the stance of the U.S. and China in wider economic disputes, including American efforts to stop countries from adopting the next-generation communications technology of China’s Huawei Technologies Co.

“The key thing I am looking out for is if they come in with offers for a vaccine in exchange for a countries’ commitment to using Huawei 5G telecommunication lines, or to allowing China to invest in key sectors,” said Guajardo. “Given that they have a history of this behavior, it wouldn’t surprise me if they did it again.”

China has made a global effort to reassure governments and populations about the efficacy and safety of its vaccines. In October, a group of ambassadors and diplomats representing 50 African countries toured a Sinopharm Group Co. facility amid a publicity blitz touting China’s promise to deliver vaccines to Africa. “When the coronavirus vaccine completes research and is put into use, we are willing to prioritize benefiting African countries,” said Liu Jingzhen, chairman of Sinopharm.

In response to questions from Bloomberg, China’s Foreign Ministry said Chinese companies developing vaccines strictly comply with the law and clinical trials in the first two phases showed the shots were safe and effective. The Chinese government has administered more than one million emergency vaccine doses since July, it said, and “we have haven’t found any serious adverse reactions.”

“China has always attached great importance to the safety and efficacy of vaccines,” the Foreign Ministry said in the statement on Dec. 22.

On China’s side is mathematics. The challenge of manufacturing, distributing and administering billions of doses means many developing nations may have little choice but to use Chinese vaccines for at least part of their populations. Many don’t have enough facilities to store Pfizer Inc.’s shot, which needs to be stored at -70 degree Celsius.

China has also agreed to supply its vaccine to Covax, a World Health Organization-backed effort to provide a coronavirus vaccine to developing nations. AstraZeneca Plc, the other main Covax partner, is still waiting to gain approval. Britain’s drug regulator could clear its shot for use as early as this week,  according to a person familiar with the matter.

Ironically, Chinese vaccine makers were initially at the forefront of the research, but China’s rapid control of the contagion left them scrambling to find places to carry out the vital third-stage clinical trials as U.S. rivals leapt ahead. Chinese companies now have third-phase trials running in at least 16 nations, with state-backed China National Biotec Group Co. testing from Argentina to Morocco; Sinovac Biotech Ltd. enlisting Brazil, Turkey and the Philippines among others; and CanSino Biologics Inc. testing in Pakistan, Mexico and Saudi Arabia.

Authorities at Brazil’s Butantan Institute, which is helping conduct clinical trials for the Sinovac vaccine, said on Dec. 23 the shot was more than 50% effective, meeting a minimum standard set by U.S. regulators for emergency authorization of Covid vaccines. It did not provide details, citing Sinovac’s request to reconcile data across different trials. The Brazil trial is Sinovac’s biggest so far with some 13,000 participants. A trial in Turkey indicated the vaccine is more than 91 percent effective, though it’s considered inconclusive as it was calculated from only 29 cases, compared with the 170 found in Brazil. Vaccines from Pfizer and Moderna Inc. have produced results well over 90%.

“In a country where the Chinese vaccine is the only one available, you either accept it or not,” said Yanzhong Huang, a senior fellow for global health at the New York-based Council on Foreign Relations. “But when you have choices between different vaccines, people are rational. They’re certainly going to choose Western-made vaccines because they’re the No. 1 choice, the data is already available, and they’re safe. China, so far, they haven’t had any systematic data available.”

CNBG and CanSino didn’t respond to Bloomberg’s requests for comment. A spokesman at Sinovac referred to recent press conferences in Beijing where health officials said the inactivated shots undergoing phase III trials and approved for emergency use have been found to be safe, with only mild side effects, and that there is a mechanism in place to follow up with those who get the shots. A Sinovac spokesman separately said the company could only disclose efficacy data after they are reviewed by Chinese regulators.

Few places have seen the issue become more politicized than Brazil, South America’s largest economy and the third-most infected country after the U.S. and India.

Brazilian President Jair Bolsonaro, known as the “Trump of the Tropics,” has repeatedly attacked “Made in China” vaccines, even as political opponent Joao Doria, governor of Sao Paulo, endorsed the Brazilian-Chinese effort by Sinovac and the Butantan Institute.

“We won’t buy it from China, it’s my decision,” Bolsonaro said in a radio interview in October. “It’s a matter of credibility — there are other vaccines that are more trustworthy.”

The government later backtracked on his statement. On Dec. 21, Doria said Sao Paulo would receive 5.5 million doses of the Sinovac vaccine within days.

Still, a survey by polling institute Datafolha earlier in the month showed that half of Brazilians wouldn’t take the Sinovac-Butantan shot, the highest refusal rate among all the vaccines. Some 36% of respondents said they’d also reject a Russian vaccine, while 23% said they wouldn’t take a U.S. shot.

The politics and public concern translate into hard economics for China’s drugmakers. When Brazil’s Health Ministry delivered a national immunization plan to the Supreme Court, it included a total of 300 million doses from AstraZeneca, Pfizer and Covax, according to the newspaper O Estado de S. Paulo. Sinovac’s vaccine wasn’t mentioned.

“Our regulatory agency is going to evaluate the data for efficacy and safety, but this needs to be well communicated to the population,” said Natalia Pasternak Taschner, a microbiologist and founder of Instituto Questão de Ciência, a Brazilian non-profit that promotes science in policy making. “It’s quite a challenge to do so when the president and the federal government are the ones raising issues about the vaccine being made in China.”

China may also be overestimating its ability to simultaneously vaccinate its own 1.4 billion population and meet the demand of hundreds of millions more in populous developing nations, said Huang at the Council on Foreign Relations, who has testified before U.S. congressional committees. CNBG said it is capable of making 1 billion doses of its inactivated vaccines, while Sinovac can produce 600 million doses, based on existing facilities and ones set to be completed soon. CanSino said it could make 200-300 million doses of its viral vector vaccines.

If Chinese vaccines aren’t available, developing nations will turn to other suppliers “and China will lose leverage,” Huang said. “We’re not just talking about the economic loss — diplomatic and strategic gains will also will be undermined.”

For the more than 6 billion people who live in developing nations, access to a vaccine soon could help reverse the devastating economic impact, particularly for the poor and those in the informal economy. Some national leaders are trying to reassure citizens about getting inoculated.

“I will be vaccinated first,” Indonesian President Joko Widodo said in a statement in mid-December. “This is to give people the trust and confidence that the vaccine we use is safe.” Indonesia has ordered 125.5 million doses from Sinovac, as well as 30 million from Maryland-based Novavax Inc. and is developing 57.6 million of its own shots. It’s also seeking doses from Covax, AstraZeneca and Pfizer.

Sheikh Mohammed Bin Rashid Al Maktoum, the prime minister of the United Arab Emirates and ruler of Dubai, received the Sinopharm vaccine on Nov. 3. “We wish everyone safety and great health, and we are proud of our teams who have worked relentlessly to make the vaccine available in the UAE,” he wrote on Twitter alongside a photo of him receiving the vaccine.

Such official endorsements may be enough to persuade some people to accept any inoculation if it receives approval.

“I would be glad to receive a vaccine, regardless of whether it’s Chinese-made or otherwise, so long as it’s proven to be safe, effective and to have no long-term side effects,” said Francis Chung, a 29-year old finance manager who works for a Malaysian plantation company. “It should also be endorsed by the relevant authorities.”

But many others remain skeptical. A survey in Kenya reinforced the concern that not all vaccines are equal. Africa-focused polling company TIFA Research found that respondents were least likely to take vaccines made in China and Russia, preferring vaccines from the U.K. or U.S.

If global leaders fail to persuade their citizens that all the vaccines they approve for use are equally safe, they could face a backlash among those who believe they are being given a second-rate option. Even in Hong Kong, where China has expanded its grip on power this year, leader Carrie Lam reversed course on Dec. 23 and said residents can choose whether to take the Pfizer, Sinovac or AstraZeneca vaccines.

“Transparency is needed in order to support more general public acceptance of the Covid-19 vaccines,” said Nicholas Thomas, an associate professor in health security at the City University of Hong Kong. “Absent such data, it is all too easy to see a two-tier perception of vaccines emerging.” — Bloomberg

SSS releases circulars on new contribution schedule

The Social Security System’s (SSS’) new contribution schedule is set to take effect on January 2021 pursuant to Republic Act No. 11199 or the Social Security Act of 2018.

Contribution Rate

Based on SSS Circulars No. 2020-033-b, 034-b, 035-b, 036, and 039 signed by SSS President and CEO Aurora C. Ignacio, the contribution rate will be 13 percent, one percent higher than the current rate.

For employed members, including OFW members in countries with Bilateral Labor Agreements (BLAs) with the Philippines, and sea-based OFW members, the additional one percent will be divided equally between them and their employers, bringing the contribution rate breakdown to 8.5 percent for their employers and 4.5 percent for them.

To cite an example, those who will be paying under the P10,000 MSC starting next year will pay a monthly contribution of P1,300, which is P100 higher than the P1,200 in 2020.

Suppose the member is employed, an OFW in a country with a BLA with the Philippines or a sea-based OFW. In that case, the P100 additional contribution will be divided as P50 from their employers for a total employer share of P850 and P50 from them for a total member share of P450.

Minimum and Maximum MSCs

Also pursuant to the Social Security Act of 2018, the minimum monthly salary credit (MSC) will be adjusted to P3,000 from P2,000, except for Kasambahayand OFW members whose minimum MSC will remain at P1,000 and P8,000, respectively, while the maximum MSC will be raised to P25,000 from P20,000.

The MSC to be considered for the computation of benefits under the regular social security program is capped at P20,000. However, contributions pertaining to the MSC in excess of P20,000 will go to the Workers’ Investment and Savings Program (WISP), a provident fund that will yield additional pension income for members contributing under it.

For example, a member will be paying under the P25,000 MSC. Based on the 13 percent contribution rate that would begin in January 2021, his/her monthly contribution will be P3,250, of which P2,600 will go to the regular social security fund, while the remaining P650 will go to the WISP.

“We understand the plight of our covered employers and members, but it is our duty to ensure the longevity of the SSS fund entrusted to us, to allow the continuous delivery of meaningful social security protection to our current and future members, as well as their beneficiaries,” Ignacio said.

The said reforms under the Social Security Act of 2018 aims to ensure the long-term viability of the SSS and provide higher benefits for SSS members and their beneficiaries.

Moreover, upon full implementation in 2025, these reforms will offset the adverse financial impact of the P1,000 pension increase granted in 2017.

“We hope that members see their contributions as their safety net and savings, which they and their beneficiaries can turn to in times of sickness, maternity, unemployment, retirement, disability, death, calamity, and other contingencies, through the benefit programs and privileges the SSS offers,” Ignacio added.

For more information, view the said SSS Circulars at https://bit.ly/3pwIJyLhttps://bit.ly/33RXdRn, and https://bit.ly/3rA8Ypw, follow the SSS on Facebook at “Philippine Social Security System,” Instagram at “mysssph,” Twitter at “PHLSSS,” or join its Viber Community “MYSSSPH Updates.”

‘Hot money’ net inflows reach $227M

MORE flighty foreign funds entered the country in November, marking the second straight month of net inflows of “hot money,”  the central bank said on Monday.

Bangko Sentral ng Pilipinas (BSP) data showed foreign portfolio investments — also known as “hot money” because of the ease by which these funds enter and exit the economy — posted a net inflow of $227 million in November.

However, this is less than the $439-million net inflows logged in October, but a reversal of the $354-million net outflows recorded in November 2019.

Foreigners invested $1.6 billion in November, but this was offset by $1.3 billion in withdrawn funds.

“The $1.6 billion registered investments for November reflected a 15.7% growth compared to the $1.4 billion recorded last month (or by $213 million),” the BSP said.

Majority or 68% of the BSP-registered foreign portfolio investments went to shares of listed companies, particularly banks, property developers, holding firms, food, beverage and tobacco companies, and retailers. Nearly a third went to investments in peso government securities.

The United Kingdom, Singapore, the United States, Hong Kong and Norway were the five biggest sources of hot money in November, with a combined share of 82%.

“Outflows for the month ($1.3 billion) were higher compared to the level recorded for October ($913 million) by 46.6% (or by $425 million), with the US receiving 74.7% of total outflows,” the central bank said.

The November tally brought the 11-month total to a net outflow of $3.7 billion, more than double the $1.6-billion net outflow during the same period in 2019.

The 11-month period saw $14.3 billion in gross outflows of hot money and $10.6 billion in gross inflows.

The central bank attributed the surge in hot money outflows this year to the continued impact of the coronavirus disease 2019 (COVID-19) pandemic on the global economy and financial system.

The BSP also cited “geopolitical tensions, certain corporate governance issues and extended quarantine measures in select regions in the country.” Metro Manila and nearby provinces remain under a general community quarantine until Dec. 31, although President Rodrigo R. Duterte was expected to announce new quarantine classifications on Monday evening.

The BSP expects hot money to yield net inflows worth $2.4 billion this year and $3.5 billion by 2021, respectively.

BoP surplus narrows for 10th straight month

THE country’s balance of payments (BoP) position remained at a surplus for the 10th straight month in November, albeit narrower than the previous month due to foreign currency withdrawals by the National Government, the central bank said on Monday.

In a statement, the Bangko Sentral ng Pilipinas (BSP) said the November BoP — a measure of the country’s transactions with the rest of the world — stood at a surplus of $1.47 billion, up 171% from $541 million in November 2019.

However, this was slimmer than the $3.44-billion surplus in October, which was a 10-year high.

“The BoP surplus in November 2020 reflected inflows mainly from the BSP’s foreign exchange operations and income from its investments abroad. These inflows were partly offset, however, by the foreign currency withdrawals the National Government made to pay its foreign currency debt obligations,” the BSP said.

November brought the year-to-date BoP surplus to $11.79 billion, up by 88% from the BoP surplus of $6.27 billion a year ago, supported by higher foreign borrowings by the National Government and the lower merchandise trade deficit.

The 11-month total already exceeded the $7.843 billion BoP surplus for the full year 2019.

The central bank forecasts a BoP surplus of $8.1 billion by yearend which is equivalent to 0.6% of gross domestic product.

The BSP said the November surplus was supported by higher foreign debt obtained by the government and the continued net inflows from remittances, foreign direct investments and trade in services.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort attributed the BoP surplus to the “narrower trade deficit/net imports about $1 billion-$2 billion per month since the COVID-19 pandemic; as exports back to pre-COVID-19 levels and among record highs; while recovery in imports remained relatively slower among 2.5-year lows; thereby fundamentally leading to relatively higher BOP surplus and GIR in recent months.”

Mr. Ricafort expects the BoP position to remain in a  surplus in the coming months as the trade deficit continues to narrow as economic recovery remains sluggish, government borrows more from foreign lenders and private companies tap external markets to raise more funds.

The foreign trade deficit went down to $1.777 billion in October from $1.783 billion the month prior and $3.573 billion a year ago after exports slipped by 2.2% while imports declined for the 18th straight month by 20%.

The expected seasonal increase in remittances from overseas Filipino workers (OFWs) also contributed to the ballooning BoP surplus and will continue to do so during the holidays, Mr. Ricafort added.

Last month’s BoP position also reflects a final gross international reserves (GIR) level of $104.8 billion, up 0.68% from $103.8 billion at the end of October.

“The latest GIR level represents an adequate external liquidity buffer, which can help cushion the domestic economy against external shocks,” the central bank said.

The BSP estimated that the GIR is equivalent to 11.2 months’ worth of imports of goods and payments of services and primary income, or 9.2 times the country’s short-term foreign debt based on original maturity.

“Going forward, the sustained BoP surpluses may lead to new record high GIR well above the latest new record high of $104.5 billion in the coming months, thereby providing a greater buffer for the peso exchange rate vs. the US dollar,” Mr. Ricafort said. — Beatrice M. Laforga

Philippines poised to be 22nd biggest economy in the world by 2035 — CEBR

THE PHILIPPINES is expected to be the 22nd biggest economy in the world by 2035, according to the Centre for Economics and Business Research. — PHILIPPINE STAR/ MICHAEL VARCAS

THE Philippines is set to become the 22nd biggest economy in the world over the next 15 years despite the disruption caused by the coronavirus pandemic, a report showed.

The London-based Centre for Economics and Business Research (CEBR) in its World Economic League Table (WELT) 2021 released this month said that the Philippines will move up 10 spots on the list by 2035 from its current 32nd position this year.

“Although the pace of economic growth in past years has been impressive, it is important to note that the population has also been rising rapidly, growing at an average annual rate of 1.5% between 2015 and 2020,” the report said.

Philippines seen to be the 22<sup>nd</sup> largest economy by 2035

CEBR noted the Philippines faced economic disruptions due to the pandemic, with the economy expected to contract by 8.3% this year.

The country’s economic managers see gross domestic product (GDP) shrinking by 8.5-9.5% by end-2020, before growing by 6.5-7.5% in 2021.

The country plunged into its first recession in nearly 30 years in the second quarter, as economic activity was hampered by strict quarantine restrictions.

“Over the next five years, the annual rate of GDP growth is set to rise to an average of 6.7%. However, between 2026 and 2035, CEBR forecasts that the average rate of GDP growth will dip slightly to 6.5% per year,” the CEBR said.

Based on the CEBR report, the Philippines is the 32nd biggest economy in the world this year, but expected to slip to 33rd in 2021. The country is poised to become the 28th largest economy in 2025, before rising to 25th in 2030 and 22nd in 2035.

The WELT report this year made some adjustments, as the study released by the center last year had said that the Philippines would reach the 22nd spot by 2034. The report said then that the country would be one of the most rapidly growing of the larger economies measured in the study, which looked at 193 countries.

The CEBR estimated the pandemic’s impact on global GDP is $6 trillion.

“We believe the longer-term hit will be smaller — falling to about $1 trillion by 2034,” it said.

Although CEBR is optimistic the availability of COVID-19 vaccines will further loosen economic constraints, it also acknowledges some long-term negative effects in many countries.

“We believe that the scarring to the world economy will affect the trade-off between growth and inflation and so predict an economic cycle in the early to mid-2020s as inflation caused by the hit to the supply side from COVID-19 works its way through,” the center said.

CEBR expects China to overtake the United States as the world’s largest economy by 2028, five years earlier than projected previously. CEBR attributed this to China’s management of the virus and the hit to long-term growth among Western economies. — Jenina P. Ibañez

Philippines seen to be the 22nd largest economy by 2035

THE Philippines is set to become the 22nd biggest economy in the world over the next 15 years despite the disruption caused by the coronavirus pandemic, a report showed. Read the full story.

Philippines seen to be the 22<sup>nd</sup> largest economy by 2035