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From showroom to cultural showcase

DESIGNS by Yumi Christina

MODA INTERNI, a luxury furniture showroom in Quezon City, is trying out something new. With millions of pesos of furniture on display, an event on Nov. 28 gave clients and media alike a taste of life with the furniture, through art, clothing, and chocolate.

“We’re trying to showcase Filipino artistry and creativity,” said Moda Interni President and Chief Executive Officer Goldwin Sison. “We are not selling furniture: we’re curating art for the house.”

Moda Interni did this by tapping the talents of three artists: visual artist Rachel Ngan Dueñas, fashion designer Yumi Christina, and chocolatíer Christian Valdes, and pairing them with their showpieces.

Ms. Ngan Dueñas, who was part of an exhibit at the Carousel de Louvre in Paris earlier this year, showed off her paintings, including one shown in that exhibit (Come Into Life). Her work was paired with Italian luxury brand Turri, with an art deco-vibe taken from its founding in the 1920s.

Yumi Christina (her work name drops her last name, Sakamoto), makes clothes out of discarded antique kimonos. Her work was paired with the opulent pieces from Opera Contemporary, founded in 1886, their work still seen in some palaces.

Finally, chocolatier Mr. Valdes, who advocates for the use of Philippine ingredients (and makes chocolate for high-profile clients internationally), was paired with Moda Interni’s luxuriously curved Pedini kitchens. “As a person who works in the food industry, kitchen design is very important,” he said in a statement. “It enhances accessibility, functionality, and even morale, creating the perfect space for culinary creativity to thrive.”

“Pedini is the perfect kitchen for someone of his caliber,” said Mr. Sison.

Aside from his personal patronage of their work, Mr. Sison brought these artists together because, “There are up and coming artists who are as creative and as artistic” as mainstream artists, he said: the art already displayed in Moda Interni includes names such as Ramon Orlina, Ronald Ventura, and Michael Cacnio. “Since we are curating art in the form of functional art — as furniture — we want to highlight the culture that goes (with it).

“We just want to show them or let them experience a total lifestyle package,” he said about his clients.

“Art is not limited to the visual arts only. Taste. Music. Living,” he said.

The work of Ms. Sakamoto, Mr. Valdes, and Ms. Ngan Dueñas will be displayed in Moda Interni’s Sct. Rallos showroom on the fifth floor of the Bonavida Center, Quezon City until the end of January 2025. The company has plans to open another showroom in Makati. According to Mr. Sison, 50% of the proceeds from sales of Ms. Ngan Dueñas’ work will be pledged to the Philippine Cancer Society. — Joseph L. Garcia

Is government ignoring the law, or is it ignorant of the law?

FREEPIK

Either way — ignoring the law or being ignorant of the law — is despicable. Ignoring the law presumes knowing the law but refusing to follow it. Ignorance of the law — not knowing the law or not knowing how it works — is sheer stupidity.

We are dealing here with how the Executive and Congress treat the Philippine Health Insurance Corp. (PhilHealth) and Universal Health Care (UHC). Recall the act of Congress and Executive to transfer P89.9 billion of PhilHealth funds to the National Government. The Supreme Court (SC) will soon decide on the unconstitutionality of the transfer. The SC has set a date for oral arguments and has issued a temporary restraining order (TRO) on the further transfer of funds (done through tranches). That’s an indication that the SC finds merit in the case.

The Universal Health Care Act (UHCA) states that PhilHealth funds cannot be transferred to the National Government, and that any funds beyond the minimum level of reserve funds must be used for the benefit of PhilHealth members.  The special provision in the 2024 General Appropriations Act (GAA) that enables the transfer of the PhilHealth funds thus violates the UHCA.

Among other Constitutional issues, the said special provision in the GAA is a rider. A rider is a provision that is irrelevant to the subject or purpose of the bill. The GAA cannot amend a statute like the UHCA. The GAA is strictly about appropriations, and it cannot order an institution like PhilHealth, whose funds are strictly for its members, to transfer funds to the National Government.

The public outrage on the transfer of PhilHealth funds to the National Government and the forthcoming SC ruling on the constitutionality of the transfer should have compelled the policymakers and politicians to become prudent and rethink their position on PhilHealth.

Congress is at the penultimate stage of approving the bill on the 2025 GAA. Again, the proposed PhilHealth budget is questionable. Congress, following the Department of Budget and Management, has substantially cut PhilHealth’s budget. Here is a statement of PhilHealth President and Chief Executive Officer Emmanuel Ledesma, Jr.:

“For Fiscal Year 2025, PhilHealth initially proposed a P150.92-billion budget to cover the premiums of 25.28 million individuals under the indirect contributors, and P21.17 billion for the benefit package improvement pursuant to Section 37 of the UHC Act, totaling P172 billion. However, the Department of Budget and Management (DBM) has only appropriated P53.26 billion to cover the health insurance premiums of 14.18 million indirect contributors and P21.17 billion to improve benefit packages.”

The above quotation comes from the Transcript of Stenographic Notes of the Senate Committee on Finance hearing on the Proposed 2025 Budget of the Department of Health and Attached Agencies and Corporations, on Oct. 8.

The Senate’s proposed budget to cover the premiums of indirect contributors is even lower than what the DBM has proposed: P47.5 billion vs. P53.26 billion.

Adding fuel to the fire is that the earmarking of revenues from the excise taxes of tobacco and sweetened beverages is not being followed. Based on the law providing for earmarking and the revenue figures from excise taxes for tobacco and sweetened beverages, PhilHealth must at least receive P69.81 billion. The proposed budget amounting to P47.5 billion or P53.26 billion is obviously short of what PhilHealth must be getting from the sin taxes.

What gives?

The legislators and the public have reason to severely criticize Mr. Ledesma for the incompetence and inefficiency of the PhilHealth leadership. But slashing the PhilHealth budget is senseless and contemptible. PhilHealth members should not be stripped of their contributions and the corresponding benefits, using the leadership’s failure as an excuse.

Note that what Ledesma and PhilHealth submitted as proposed budget is the amount that will cover all the indirect contributors, based on the minimum premium for PhilHealth membership. But Congress and the DBM have allocated an amount that technically will exclude 11.10 million indirect contributors.

Another way to look at this is that the sustainability of PhilHealth funds and benefits is now seriously threatened.  Further, it is most inequitable and iniquitous that direct contributors — many of them ordinary workers — will now shoulder a bigger share of funding PhilHealth.  And so, while government is defunding PhilHealth, the direct contributors are now paying higher premium rates. The government is violating the principles of social health insurance — turning back from its role of enabling the right to health, debasing solidarity, and degrading fairness.

And contrary to the perception that PhilHealth has excess funds, a deeper inquiry into PhilHealth’s financial statements shows that the reserve funds it has — including the so-called “excess” — is not sufficient to cover insurance contract liabilities (ICL). In December 2023, PhilHealth’s reserve fund stood at P464 billion. In March 2024, the reserve fund was at P488 billion. But the ICL amounted to P1.128 trillion. In other words, the transfer of PhilHealth funds to the National Government and the drastic reduction in the PhilHealth budget for the indirect contributors, together with the commitment to expand benefits, will only widen the deficit. (See the column written by Enrico P. Villanueva, “State of the PhilHealth fund: Claimed excess ignores reserve deficit and service gaps,” Nov. 4.)

The Executive and Congress will again be violating the law. Or perhaps, they are displaying their dumbness. The statement of Senator Grace Poe, the chair of the Senate Finance Committee, is telling:

“Alam naman natin na ’yung PhilHealth, they were asking for about 70 plus billion. Nasa 60 plus billion sila ngayon.  Pero binigyan pa rin ha. Pero ito, ’yung pinuntahan ng ibang pondo ng PhilHealth, nabigay sa MAIP (Medical Assistance for Indigent Patients) program, nabigyan din ’yung mga DoH (Department of Health) hospitals para direkta na.”

Senator Poe misses the essential point. That government must provide the premiums for all indirect contributors. To withdraw or reduce funds for the premium of PhilHealth indirect contributors is to destroy the very essence of universal healthcare. Taking away funds from PhilHealth contradicts the fundamentals of giving healthcare coverage to all Filipinos, expanding benefits and services for all, progressively reducing out-of-pocket expenses, and ensuring sustainability.

And the cat is out of the bag. PhilHealth is being defunded so the funds can be transferred to the so-called Medical Assistance for Indigent Patients program, which is but an inefficient, non-transparent, and discretionary pork barrel fund that serves a politically partisan objective. While it is understandable that politicians want a kitty for ayuda (assistance), this should never be at the expense of destroying PhilHealth and universal healthcare.

 

Filomeno S. Sta. Ana III coordinates the Action for Economic Reforms.

www.aer.ph

(Re)selling the idea of electrified vehicles

A Toyota bZ4X battery electric vehicle plies the streets of Paris. — PHOTO BY KAP MACEDA AGUILA

Are expensive battery replacement and perceived low resale value turning you off xEVs?

AS THE JOURNEY to electrified mobility moves forward, a better grasp of the technology is needed to accelerate adoption.

To begin with, there is a need to increase understanding of the various electrified options (xEVs) — hybrid, plug-in hybrids, full battery electric, and hydrogen fuel cell, among others. Of course, it will be recalled that electrification is the emergent new energy vehicle technology needed to intensify the fight for carbon neutrality. In this regard, multiple pathways are available. Any enhanced technology that helps reduce carbon emissions should be welcome even, for example, biofuel alternatives or more efficient internal combustion engines. Consumers should be able to choose the most appropriate option that fits their mobility needs, purchase capacity and operability, including the state of infrastructure support in their area.

Another aspect of electrified mobility that will benefit from greater understanding is the apprehension regarding the cost of electric battery replacement and its potential impact to ownership cost and resale value.

A hybrid electric vehicle (HEV), plug-in hybrid electric vehicle (PHEV) and battery electric vehicle (BEV) are more expensive to produce than their internal combustion engine (ICE) counterparts. The biggest cost difference lies in the battery, which — according to Statista — accounts for around 28% of the total cost of a large electric vehicle, down from about 49% in 2016.

The most immediate recourse for increasing driving range of EVs is to increase battery capacity (and size). Unfortunately, this adds to the weight of the car, thus affecting performance, and it significantly ups the vehicle price. Conversely, it can be argued that the way to reduce prices of EVs is to reduce the size of the battery. This will unfortunately shorten range and increase user anxiety. The size of an HEV battery is naturally smaller than that of a BEV. It is a self-charging technology that does not depend on battery size to increase distance. The focus is on engine operating efficiency, thus avoiding range anxiety when driving.

In my understanding, auto engineers design the electric battery to match the life of the vehicle. In fact, I recall seeing a testimonial from an associate of Maple Toyota, a dealer in Canada, who claims that in his 16 years working with the dealership, he has never seen the battery of a Toyota HEV replaced and they have been receiving for servicing HEV taxis with mileage of up to 800,000 kilometers.

Like fuel efficiency in the case of ICE vehicles, how far you go on battery power is impacted by driving habits, terrain, and car maintenance. These also affect the wear and tear of the battery. An early study of Tesla batteries done by Steinbuch that was updated in 2020 claims that fast battery degradation of 5% is experienced in the first 40,000km of usage followed by an average slow degradation of 1% every 40,000km up to 320,000km. At an average driving mileage of 20,000km per year, the study covers about 16 years without full degradation of the battery.

The fact that auto manufacturers now offer an eight-year warranty on batteries is further testament to the confidence of makers in their durability. Toyota HEVs are now in their fourth generation and the technology of both the key hardware components (i.e. motor, inverter, and battery) as well as the operating system that manages the hybrid performance has advanced significantly. Toyota has sold over 22.5 million electrified vehicles over the last 25 years, resulting to CO2 emissions reductions equivalent to what would have been saved by approximately 7.5 million BEVs. This real-world experience using actual driving performance has been harnessed to improve the efficiency of Toyota electrified vehicles, including reducing costs.

HEVs have also been proven to hold their value quite well over time. While some motorists may focus on the cost of battery replacement, it can be compared to worrying about getting a new head gasket, a ring job or, in the case of extreme use, an engine overhaul (that can cost as much as P100,000) or even a new transmission for a 10-year-old ICE car. The fact that HEVs are widely used as taxis in cities like Japan, New York, and London is also testament to their durability. For BEVs, the case becomes even more compelling because they have significantly less parts than ICE vehicles. A Forbes article by Tom Raftery cites that an ICE drivetrain has about 2,000-plus parts versus 20 in an EV. As long as cars — whether in EV or ICE form — are properly used and maintained, we can rest assured that our cars will hold up very well over time.

And then, of course, there is the cost of batteries. An article by Hannah Ritchie for ourworldindata.org in 2021 claims that prices of lithium-ion battery cells per kilowatt-hour (kWh) have dropped from US$7,523 in 1991 to US$181 in 2018. To put this in context, the author cited the 40-kWh battery of the Nissan Leaf that cost US$7,300 in 2018 would have cost US$300,000 back in 1991. A Prius owner I know bought his car in 2011 and was told that the battery replacement would cost P700,000. In 2021, he replaced the battery at a cost of P350,000. Prices of batteries can be expected to drop even more with increased volume, new technologies, and even new types of batteries like solid state ones.

So, how do all these weigh on the resale value of EVs? Given a normal level of use of the car and a reasonable maintenance regimen, the prospective impact of a battery replacement on the resale price should not be significant. Batteries are less consumable than they are depreciable; they are meant to last the life of the car. As such, they should not be an extraordinary factor in determining the value of a pre-owned vehicle.

A quick search of resale values in the United States do not show any remarkable difference between the resale values of ICE cars and HEVs. I saw a real-world quote on an almost-four-year-old RAV4 HEV with 48,000-km mileage by Carvana back in August 2023. The transaction price for the brand-new vehicle was US$38,000 and the quote for resale was US$32,830, a 13.6% depreciation — quite reasonable, even if we factor in the auto supply chain disruptions that elevated pre-owned car prices.

If you plan to hold on to your hybrid for 10 years prior to reselling it, maybe the next owner will not be as concerned about the battery replacement as he would be about your use and care for the car. He might benefit from the expected further reduction in battery prices, too. The replacement battery for the Corolla Cross HEV costs around P195,000. The Camry HEV battery is priced at P219,000. In 10 years, this might halve again.

Should we worry about the resale value of electrified vehicles? Not more than we should for an ICE car, I think.

Russia cuts wheat exports in move to contain inflation

REUTERS

MOSCOW — Russia, the world’s largest wheat exporter, cut its 2025 export quota by two-thirds, hiked wheat-export duties and abandoned import quotas for some staple foods on Friday as the government moved to curb inflation.

The Eurasian Economic Union (EEU) Council said Russia’s export quotas for the second part of the export season from Feb. 15 to June 30, 2025, will be 11 million metric tons, down from 29 million tons in the same period this year.

The EEU comprises Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia and coordinates the customs and tariff policy of its members.

In a separate announcement, Russia’s agriculture ministry hiked the wheat-export duty by over 18% from Dec. 4.

“We are strengthening control over the export of agricultural products to prioritize the supply of the domestic market. These measures should stabilize the price situation,” said Deputy Prime Minister Dmitry Patrushev.

Mr. Patrushev said the government encouraged retailers to set long-term contracts with producers of potatoes and vegetables while regional authorities were working with retailers to stabilize prices for butter, sugar and bread.

The government is working to increase food imports from “friendly” countries, Mr. Patrushev said, while the EEU Council said it introduced duty-free quotas for imports of potatoes, carrots, apples and butter.

Russia allows grain exports quota-free from July to January, the first half of the export season, and then implements quotas among about 260 domestic traders authorized to sell grain internationally from Feb. 15 to June 30.

Analysts expected the export-quota cut, which resulted from the high export pace in recent months and a worse-than-expected harvest due to bad weather in most Russian wheat-producing regions.

“The decision will help smooth out fluctuations in consumer prices caused by the depletion of domestic production stocks and the need to supply the domestic market through imports, and will contribute to curbing inflation,” Russia’s economy ministry said in a statement.

The measures will be closely watched by Russia’s biggest wheat buyers, Egypt, Iran, Turkey, Algeria and Saudi Arabia.

Moscow has been looking to curb exports of staple foods and boost imports as it fights inflation at 8.5%. Price growth for butter, bread, dairy products and potatoes caused particular concern.

Butter prices were up 32% this year while prices for potatoes were up almost 80% and prices for bread climbed 13%, according to official statistics.

Russia introduced wheat-export quotas in 2020 to protect the domestic market.

The Russian Grain Exporters and Producers Union expects wheat exports in 2024/2025 of 47 million to 52 million tons, which it says will be enough for Russia to remain the top wheat exporter.

“However, the food security of the people in the countries to which we supply Russian wheat and other grain products is much more important to us,” said the union’s head Eduard Zernin.

At the start of 2024, the original quota of 24 million tons was increased a further 5 million tons against the backdrop of the previous season’s record grain exports, estimated at no less than 72 million tons.

The EEU Council statement said the quota for the same period of 2024 included corn and barley, which were excluded from the quota in the coming season. — Reuters

GT Capital says REIT launch not a priority

GTCAPITAL.COM.PH

GT Capital Holdings, Inc. said that establishing a real estate investment trust (REIT) unit is not a priority as the company focuses on expanding its property portfolio.

“It’s not going to happen because, in order for you to have a meaningful REIT, you need to have income-earning assets of a meaningful size. We don’t have that yet,” GT Capital Chief Financial Officer George S. Uy-Tioco, Jr. told reporters on the sidelines of a forum in Taguig City last week.

“If you were to rank things on our list of priorities, that’s (REIT) not even in the top list,” he added.

In June, GT Capital said it was open to the possibility of establishing and listing its own REIT unit once the “right conditions” are present and its real estate subsidiary Federal Land, Inc. boosts its recurring income.

However, Mr. Uy-Tioco said that GT Capital is not yet in a position to take advantage of having a REIT subsidiary.

“We’re open to looking at different funding mechanisms. If a REIT funding mechanism is an opportunity that is there for us, why not? However, in order for us to make that meaningful, we need to have a large enough rental income or recurring income base,” he said.

Asked about Federal Land’s initial public offering (IPO) plans, Mr. Uy-Tioco said it is still too early as the property developer is still growing its presence.

“It is not big enough yet. We have not talked about that in terms of our strategic planning,” he said.

“If you want to do a meaningful IPO, you need to have a certain size. For us, the level of development and the level of maturity of the company, we are not there yet. It is going to take a while,” he added.

Mr. Uy-Tioco also said that GT Capital is still studying its plans to expand into healthcare, renewable energy, and data centers.

“It’s too premature for us to expound on that because we’re studying it. In the instance of healthcare, there are a lot of groups that are going into it. We want to choose where we think we can add the greatest value that will also give us the best returns,” he said.

“We want to have a more direct say. We like working with partners, but we also want to have a more direct say in a specific sector,” he added.

GT Capital has interests in banking, automotive assembly, importation, dealership, and financing, property development, life and general insurance, and infrastructure. — Revin Mikhael D. Ochave

Security Bank sees steady loan growth

BW FILE PHOTO

SECURITY BANK Corp. expects steady but muted growth in its loan book in 2025 as it has seen faster-than-expected expansion so far this year.

“We grew way faster this year than we had expected. It’s not that we’re not optimistic — we are — but the reality is you’re having to grow a much larger book because our book is bigger this year. Even if we grow more in nominal terms, which we expect, we also have to be mindful of managing the amount of risk we take,” Security Bank Chief Financial Officer Eduardo M. Olbes told reporters on Friday.

Security Bank’s loans grew by 15.68% to P622.75 billion at end-September from P538.33 billion at end-2023, its financial statement showed.

Mr. Olbes said the bank’s corporate loan book, which currently makes up about 70% of Security Bank’s total portfolio, will grow in line with the country’s economic growth.

“So, if GDP (gross domestic) growth is on the slower side, then the loan demand on that side will also be slower because these are the companies who are, in a sense, driving that GDP growth. Here, what we’ve seen is it’s very, very competitive because the loan demand is slower. Many banks are competing, and so the pricing on those loans is going down. What we’re hoping to see is hopefully as the economy grows faster, we hope to see a pickup in terms of loan demand in that sector,” he said.

The government is targeting 6-7% GDP growth this year and 6.5-7.5% expansion for 2025.

In the first nine months, Philippine GDP growth averaged 5.8%. To meet the lower end of this year’s 6-7% target, the economy would need to grow by at least 6.5% in the fourth quarter.

Mr. Olbes added that the bank does not expect its performance for this year to be affected by the slower-than-expected GDP growth in the third quarter as the Philippines continues to be one of the fastest-growing economies in Southeast Asia.

Meanwhile, Security Bank’s loans to the retail and micro, small, and medium enterprise (MSME) sector have grown faster than expected as consumer spending has returned to pre-pandemic levels, he said.

“Retail loans are mainly three lines of business: home loans, auto loans, and credit card. Across all [lines], it’s been growing very fast, meaning the demand has been quite strong… In the case of credit cards, we’ve also seen spending on the cards recover above where it was pre-pandemic, so that’s good news. That means that consumers are basically spending.”

He added that the bank expects steady growth in its MSME loans this quarter. Lending to the segment expanded by over 60% as of the third quarter.

“The small-, medium-sized entrepreneurs are the folks. Eventually, some of them will grow their business into big businesses and you want to see activity there because they’re also big employers. So, those are the two areas where the growth is quite rapid, and we’ve seen that strength throughout the first three quarters. We expect that momentum to continue through the fourth quarter,” Mr. Olbes said.

The lender could also see consumer credit cornering a bigger share of their loan portfolio amid faster growth in the segment, he added.

“Not by a lot, but by a little. It’s a function of the growth rates being much faster. Let’s say on the consumer side, we’re growing over 30% year over year. On the corporate side, that’s growing mid-teens, around 14 to 15%. So, if something’s growing two times faster, mathematically, it accounts for a bigger piece. That is not because that’s necessarily the way we want it, meaning we’re not intentionally biased in favor of retail versus wholesale,” Mr. Olbes said.

“We want to serve the demand, and therefore, the demand has been quite strong on consumer and MSMEs, and that’s why we’ve been growing faster. From our standpoint, we don’t have any intent to necessarily change the mix. It’s just a function of if the demand is there and we’re okay with the risk reward, we will do it.”

The bank’s new mobile app is also expected to boost its consumer business next year, he said.

Security Bank also expects the Bangko Sentral ng Pilipinas’ (BSP) easing cycle to spur loan demand next year, the official said. The bank sees the BSP incrementally cutting rates by 100 basis points in 2025, but this will also depend on the peso and developments in the US.

“What we’ve seen though now is the interest rates have only begun to go down; people believe that interest rates will continue to go down next year,” Mr. Olbes said.

The upcoming rate cuts will also result in the downward repricing of about 50% of the bank’s total loan book, but Mr. Olbes said Security Bank will remain competitive in terms of pricing.

“Where the rates will move on the loan is on the short-term loan side. So, these are the working capital loans that you give to the large companies. That one will also instantaneously adjust,” he said.

Meanwhile, the bank’s profitability could continue to improve as it reaches the tail-end of heavy technological investments while its revenues steadily grow.

“On the cost-to-income ratio, our expenses are also growing faster than industry simply because we are making a lot of investments in terms of technology and people… So for next year, to be able to manifest better profitability, the revenues have to grow as fast as they’re doing now or better. We expect to improve in terms of cost-to-income ratios, which means more of the revenues will hit the bottom line and we also expect an improvement in terms of credit cost. So, all three factors will need to translate, and you’ll see that in better return on equity,” Mr. Olbes said. 

The bank aims to reach double-digit return on equity next year.

However, Mr. Olbes said the bank’s expenses could rise as it plans to further expand its branch network outside the National Capital Region (NCR).

“We hope to end this year somewhere around the 340 area. By next year, we imagine that we will be close to probably around 400 branches… We’re pushing a lot into areas outside of NCR,” he said, adding that the bank is underrepresented in provincial areas despite the increase of commercial hubs.

Security Bank’s net income rose by 13.58% year on year to P3.01 billion in the third quarter amid higher revenues.

This brought its nine-month net profit to P8.45 billion, up by 11.62% from a year ago.

HOME CREDIT STAKE
Meanwhile, Security Bank on Friday announced that it will acquire MUFG Bank Ltd.’s 25% stake in HC Consumer Finance Philippines, Inc. (HCPH) or Home Credit Philippines as part of its consumer growth strategy.

The bank will purchase the stake for P11 billion, the listed bank said in a disclosure to the stock exchange.

Krungsri (Bank of Ayudhya PCL and its business units) will continue to hold a 75% ownership stake in HCPH and remain the majority shareholder.

This represents the second partnership between Security Bank and Krungsri, with the first being the joint venture for SB Finance, Inc.

Security Bank aims to complete the transaction within the first quarter of 2025, subject to regulatory approvals. — Aaron Michael C. Sy

St. Luke’s Medical Center unveils newly improved Skin Center

FREEPIK

ST. LUKE’S Medical Center (SLMC) in Quezon City launched the Skin Center by St. Luke’s last week, unveiling a newly improved dermatology center that offers a comprehensive range of advanced clinical aesthetic and skin care procedures.

According to Dr. Dennis P. Serrano, president and chief executive officer of SLMC, the new facility is a key part of the hospital’s rebranding efforts, aiming to strengthen its position as a one-stop hub for both pathologic and aesthetic services.

“There’s a new message that while we are a hospital, we do not forget that there is also a big clamor and demand for aesthetic procedures and services, and this seeks to address that without sacrificing our mission to care for pathologic diseases,” Mr. Serrano told BusinessWorld.

The clinic addresses patient expectations for optimal facilities, equipment, and results, Mr. Serrano said, noting the previous clinic’s limitations.

“While we have always had the expertise, rebranding just gives the message that we’ve improved. We have upgraded, and we are ready to meet the highest expectations of our patients,” Mr. Serrano said.

During the Skin Center by St. Luke’s launch event, members of the media, guests, and medical practitioners at SLMC toured the facility.

Each room is equipped with dedicated machines designed for a variety of optimal skin care services, including laser and energy-based treatments for pigment and tattoo removal, hair removal, facial and body sculpting, and other advanced skin aesthetic procedures. 

The facility also offers specialized services for various skin conditions, including photodermatology for treating psoriasis and vitiligo and Mohs micrographic surgery for precise skin cancer removal. It also provides services such as microscopic skin biopsy readings, hair restoration procedures, and pediatric dermatology.

Mr. Serrano told BusinessWorld that this recent development underscores St. Luke’s initiative to stay at the forefront of technological advancements in dermatology and remain at par in the field. — Edg Adrian A. Eva

Philippine politics is often mad. It just got crazier

PRESIDENT Ferdinand R. Marcos, Jr. (R) together with Vice-President Sara Duterte. — PPA POOL/KING RODRIGUEZ

POLITICAL VIOLENCE is nothing new in the Philippines. It was, after all, the site of the world’s worst massacre of media workers when 58 people, including 32 journalists, were murdered in 2009 while traveling in an election convoy on the southern island of Mindanao.

The powerful Ampatuan clan had pre-dug a vast grave in preparation for the cars carrying relatives of their rival, Esmael Mangudadatu, to arrive at a police checkpoint. Heavily armed gunmen intercepted the motorcade, killing then burying them all. I was on Mindanao soon after as part of a team of press freedom groups including the Committee to Protect Journalists and the International Federation of Journalists that examined the killings: It was a chilling scene. There’s been a steady stream of local assassinations and kidnappings ever since, and plenty beforehand, too.

So when Vice-President Sara Duterte — daughter of former president Rodrigo Duterte — released a bizarre video Nov. 23, telling President Ferdinand Marcos, Jr. she would have him assassinated if someone did the same to her, many rolled their eyes and prepared for another round of hostilities. The influential media site Rappler was first to draw the similarities: “Sara Duterte unleashes the Ampatuan within,” its headline read, noting her video was released on the 15th anniversary of the massacre.

Duterte announced her resignation from Marcos’s cabinet in June, while remaining VP, highlighting the extent of the fallout between the two families. Since then, she’s been escalating her criticisms of the president, threatening to exhume his father’s remains and throw them in the sea, and saying that she imagined beheading him. Duterte also alleged, as others have before her, that the Marcos family plotted the assassination of former senator Benigno Aquino — a member of another large political dynasty — in 1983*.

For his part, Marcos has tightened his security and said: “Such criminal attempts should not be ignored,” while the Philippines’ National Bureau of Investigation issued a subpoena to Duterte. After all, she may have downplayed her remarks, but it is hard to ignore her repeated thoughts of violence about the president. A government panel postponed its Friday hearing into allegations Duterte misused public funds, claims she has denied, to allow her to answer the subpoena instead.

So what happens now? The nation’s mid-term elections are due in 2025 and Duterte Sr. has filed his candidacy for mayor of Davao on the island of Mindanao — a position that he has held before, and one the clan has controlled for three decades. His two sons are also planning to run for the Senate. Of course, Marcos himself is in the family business: He is the son of former dictator Ferdinand Marcos, known for his rampant corruption and deadly political repression, while his sister Imee is a senator, his son is a congressman, and his cousin is house speaker. It’s dynastic politics run wild, and unless it’s contained, this feud will set the Philippines on another course of instability at the worst possible time — it is dealing with daily threats from China in the South China Sea and facing the uncertainty that comes with President-elect Donald Trump in the White House.

The political marriage of convenience between the rival clans forged during the 2022 elections that brought Marcos Jr. to power was never going to last. Things deteriorated quickly when the House of Representatives began hearings in August to examine Duterte Sr.’s deadly drug war, along with his daughter’s actions as head of the Department of Education. There are other pressures, too: The International Criminal Court (ICC) is also investigating Duterte Sr.’s campaign of extrajudicial killings during his term as president from 2016 to 2022 that left more than 6,000 dead. Human rights groups like Amnesty International say the toll could be as high as 30,000.

Although Marcos Jr. has said he doesn’t support an outside investigation, it no doubt sent a chill through the Duterte clan when his executive secretary announced that if the ICC refers the process to Interpol and requests the Philippines’ help, it would receive full cooperation.

All this domestic drama will be troubling the Philippines’ allies and partners — particularly the US, Japan, and Australia — which have been steadfast in their support for Marcos Jr.’s policy of pushing back against China’s hostile actions in the South China Sea, where more than $3 trillion in goods pass through every year. When he took office, Marcos Jr. steered the nation away from his predecessor’s soft approach to Beijing, granting the US military access to more bases, increasing naval missions in the disputed waterway, and widely publicizing violent attacks on its vessels by the Chinese Coast Guard.

Earlier this month, the president signed two laws to strengthen the Philippines’ maritime claims, including one that creates a system for foreign vessels and aircraft to exercise the right of passage through its waters and airspace. Beijing, which lays claim to most of the South China Sea, strongly condemned the move.

Manila cannot afford to be distracted by this latest round of clan rivalry and threats of violence. Trump has appointed two China hawks in key roles in his new cabinet: Senator Marco Rubio is in line for secretary of state, while Mike Waltz is tipped to be national security advisor. That means US and China relations are set for another rocky period, and one where its treaty allies like the Philippines will be expected to continue with their own tough stance against Beijing.

Marcos Jr. has managed the drama well so far, but he needs to get his house in order. As jaw-droppingly unhinged as Philippine politics can be, there are larger issues at stake — and powerful allies to keep happy.

BLOOMBERG OPINION

*His death sparked mass protests against Marcos Sr., who enacted Martial Law from 1972 to 1981. He was ousted through a people-power revolt in 1986 led by Aquino’s widow Corazon, who then became president.

Google Maps reimagines navigation with AI

Immersive View can now provide suggestions on where to park. — IMAGE FROM GOOGLE

By Hazel Nicole Carreon

WITH OVER two billion active monthly users across the world, Google Maps continuously improves its platform with new updates to provide a fresh and comprehensive map to every user.

The product is now integrated with Gemini, Google’s artificial intelligence (AI) model. With this upgrade, drivers using Android and iOS devices will be able to get information on the places they can visit and things they can do in a specific area. Gemini will also be able to generate review summaries and quick answers to queries about these places.

Google Maps guarantees that the information provided will be updated and accurate, “grounded in trusted data on about 250 million places around the world and insights from the Maps community,” said Google Maps Vice-President and General Manager Miriam Daniel during a virtual roundtable discussion with members of local and international media.

These features debut in the United States recently, and the platform will also be rolling out an enhanced navigation system there that will clearly indicate the lanes, crosswalks, and road signs on the map — making driving along unfamiliar roads easier and stress-free.

For the rest of its markets including the Philippines, the navigation app launched the Flood Forecasting feature that can predict (also through AI) if a flood may be coming into an area, and gives notice to the user to help them evacuate as soon as possible.

Furthermore, Google Maps now allows global users to plan their trip before heading out as it now provides a list of the best landmarks and dining options along their route. It also shows the nearest parking lots to the destination and walking directions from the car to the entrance.

Meanwhile, the Immersive View feature, which was launched in 2023, has expanded to 150 cities, including Kyoto, Brussels, and Frankfurt. It lets users see what a specific place looks like and even predicts the weather and traffic conditions on the area on the day and time of the planned visit.

Google Maps added new categories of places to Immersive View such as university campuses. This feature can now give suggestions on parking spots and warnings if there are complex turns ahead.

According to Geo, the Google team that develops its Maps, Earth, and Street View platforms, Immersive View was built using different innovations in AI, computer vision, and imagery technology. “We fused them together and helped create this photorealistic view of the real world going far beyond what you could get with a two-dimensional map,” Geo Vice-President and General Manager Chris Phillips stated.

Waze, another Google-owned navigation app, also launched a new feature that allows any user to report a range of incidents, such as traffic, potholes, construction, and more. Through the Conversational Reporting feature, drivers can simply tap the reporting button and speak naturally, then Waze will automatically add a real-time report to the map to make other users aware of the situation in the area.

The feature was rolled out in beta to Waze’s trusted testers across the world. Waze is also set to release the School Zones feature later this year, enabling users to receive an alert reminding them to drive with extra caution when near a campus.

PLDT stock down amid market woes, flat earnings

PHILIPPINE STAR/IRISH LISING

SHARES of the Pangilinan-led PLDT declined last week following market pressures and cautious investor sentiment.

Data from the Philippine Stock Exchange showed that the telecommunications giant ranked 8th in value turnover, with P1.13 billion worth of 866,765 shares traded from Nov. 25 to 29.

PLDT shares closed at P1,297 on Friday, down 3.93% from P1,350 on Nov. 22. Year to date, the stock inched up by 1.41%.

Cristopher Adrian T. San Pedro, an equity trader from Unicapital Securities, Inc., said in a Viber message that investors remained cautious and on the sell side due to a lack of catalysts and uncertainties surrounding US tariffs, monetary policy, and political risk.

In a separate Viber message, Jeconiah S. Nicolas, a research analyst from The First Resources Management and Securities, said PLDT remains “fundamentally strong” despite general market pessimism due to Donald J. Trump’s protectionist policies.

“In addition, the current labor union issues and the flat Q3 (third-quarter) earnings of the company may have also been contributing to the negative jitters for the stock,” Mr. Nicolas said.

US President-elect Donald J. Trump last week pledged tariffs on Canada and Mexico, as well as additional tariffs on China, saying the policy would remain in place until it “clamped down” on the drug fentanyl and its illegal immigrants crossing the border.

PLDT last Thursday addressed the labor union issue, stating it is working with the labor department and its rank-and-file workers union to resolve the issue linked to their ongoing collective bargaining agreement negotiations. It also said its operations will remain unaffected despite the threat of a nationwide strike by the union members.

Last Wednesday, PLDT announced a new service that promises to provide “always on” connectivity to its users, marking the country’s first-ever “uninterrupted” broadband service. The service features a hybrid modem that automatically switches a customer’s connection from fiber to LTE in case of service interruption.

Mr. Nicolas said this initiative by the company provides “breathing room” for its investors by ensuring it maintains a competitive service within the tightening competition in the Telco industry.

“However, we believe that potential investors would still be in a ‘wait-and-see’ mode on how its recent development will contribute to the improvement of the company’s services, which is crucial for PLDT’s operations,” he said in the same Viber message. 

For the third quarter, PLDT reported a 2.28% year-on-year increase in its attributable net income to P9.7 billion from P9.49 billion. Meanwhile, its consolidated revenue rose by 1.99% to P53.36 billion from P52.32 billion.

For the first nine months of the year, its attributable net income increased by 0.81% to P28.22 billion from P28 billion, while consolidated revenues for the period increased by 2.93% to P160.94 billion from P156.36 billion.

Mr. San Pedro expects a revenue target of around P55.2 billion for this quarter, while his full-year forecast is a total revenue of P215 billion.

Meanwhile, Mr. Nicolas places it slightly higher, expecting PLDT to post earnings of P57.5 billion with a full-year forecast of P222.17 billion.

For his part, Mr. San Pedro puts the support level near P1,255 and P1,290, with resistance levels projected at P1,356 and P1,400.

“The trend remains bearish as the stock is still searching for a potential short-term bottom,” he said.

Mr. Nicolas pegged the resistance level of its recent head and shoulder pattern at the P1,450 level, with a second resistance at its August high of P1,600. For the support level, he puts P1,270-1,280 as strong support for the stock.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Kenneth H. Hernandez

Gov’t debt yields end mostly higher on Fed

YIELDS on government securities (GS) traded in the secondary market ended mostly higher last week amid uncertainty over the pace of the US Federal Reserve’s policy easing cycle.

GS yields, which move opposite to prices, went up by an average of 2.97 basis points (bps) last week, based on the data from PHP Bloomberg Valuation Service Reference Rates as of Nov. 29 published on the Philippine Dealing System’s website.

At the short end of the curve, the rates of the 91-, 182-, and 364-day Treasury bills (T-bills) went up by 11.13 bps (to 5.6445%), 2.48 bps (to 5.9236%), and 6.39 bps (to 6.0048%), respectively.

At the belly, yields on the two-, three-, and four-year Treasury bonds (T-bonds) increased by 4.09 bps (to 5.9342%), 2.15 bps (5.9327%), and 0.62 bp (5.9419%), respectively. Meanwhile, the five- and seven-year bonds saw their rates inch down by 0.07 bp (to 5.9568%) and 0.3 bp (5.9871%), respectively.

At the long end of the curve, the rate of the 10-year debt paper declined by 2.28 bps to 5.9987%, while the 20- and 25-year T-bonds saw their yields increase by 4.12 bps (to 6.1475%) and 4.33 bps (6.1489%), respectively.

GS volume traded reached P48.25 billion on Nov. 29, higher than the P23.45 billion recorded a week prior.

“The market was generally sideways with a defensive tone as uncertainties with regards to the Fed rate cut path dampened the mood locally,” Dino Angelo C. Aquino, vice-president and head of fixed income at Security Bank Corp., said in an e-mail.

“With the resilience of the US economy, rate cuts in the US are slowly being priced out; hence, investors opted to stay on the sidelines given the volatility.”

He noted that yields on the five-, seven-, and 10-year bonds declined slightly as the peso rebounded against the dollar during the week.

“The stability of the local pair prompted some buying,” Mr. Aquino said.

Sandra P. Araullo, chief investment officer at ATRAM Trust Corp., said in a Viber message that the bond market traded within a tight range last week as investors digested US economic data releases.

“The rally in US rates was not enough to spur any strong risk-taking sentiment for Philippine bonds. The volatility of the peso-dollar exchange rate may have contributed to the muted interest for peso government securities as the currency pair traded at intra-year highs,” Ms. Araullo said.

“Demand was concentrated in the belly of the curve… Sparse demand was seen for the rest of the curve as investors continue to bargain hunt,” she added.

Federal Reserve officials appeared divided at their meeting last month over how much farther they may need to cut interest rates, but as a group agreed to avoid giving much guidance from here on about how US monetary policy is likely to evolve, Reuters reported.

There was uncertainty about the direction of the economy, Fed officials noted, according to the minutes of the Nov. 6-7 meeting, uncertainty about just how much the current level of interest rates was doing to restrict the economy — a key issue in deciding how much further rates should fall — and a developing case to step carefully.

“Many participants observed that uncertainties concerning the level of the neutral rate of interest complicated the assessment of the degree of restrictiveness of monetary policy and, in their view, made it appropriate to reduce policy restraint gradually,” said the minutes, which were released on Tuesday.

The neutral interest rate is the level at which economic activity is neither stimulated nor restrained.

The Fed cut its benchmark policy rate by a quarter of a percentage point to the 4.5%-4.75% range at the meeting, a session that followed Republican candidate Donald J. Trump’s victory in the Nov. 5 US presidential election.

Though the implication of the election outcome was not mentioned in the minutes, “many” participants noted the complications of making policy at a time when economic data was volatile due to storms, strikes and other factors, and geopolitical tensions were high.

After the release of the minutes, financial markets added slightly to bets on a rate cut at the Fed’s Dec. 17-18 meeting, and kept intact prior bets on a slower pace of reductions next year, with just one cut priced in by the middle of the year.

Meanwhile, the peso closed at P58.62 versus the dollar on Friday, rising by 5.1 centavos from Thursday’s finish. This was a near three-week high as this was its best close since Nov. 11’s P58.595.

The local unit saw a volatile trading week as it ended at its all-time low of P59 again on Tuesday and then strengthened for three straight sessions as the outlook for US rates weighed on the dollar.

For this week, government debt may continue trading within a tight range, Ms. Araullo said.

“The local market will likely take cues from key data to be released in the US, namely, the global purchasing managers’ index figures and the latest nonfarm payrolls,” Ms. Araullo said.

“On the local side, the CPI (consumer price index) for November will be released. Early indications show that it will print at 2.5%, which is slightly higher from the previous month. We are not expecting that there will be a significant upside surprise to cause another strong sell-off in the local market. We view the current levels now as good opportunities to reposition as we continue to anticipate further rate easing in December and the coming year,” she added.

For his part, Mr. Aquino likewise said Philippine inflation and US jobs data will be the key trading drivers for this week.

“Players will likely remain defensive but still inclined to bargain-hunt given that the BSP (Bangko Sentral ng Pilipinas) is still on an easing cycle… The market may continue to see buyers on any uptick on rates as risk on local inflation remains skewed to the downside,” he said.

“All eyes will be on the US nonfarm payrolls data this Friday, which could provide further clarity on the Fed’s easing path,” Mr. Aquino added.

The BSP on Friday said headline inflation likely settled within the 2.2%-3% range in November, slower than the 4.1% print in the same month a year ago.

However, the upper end of the forecast would be faster than the 2.3% recorded in October.

The Philippine Statistics Authority will release November CPI data on Dec. 5.

BSP Governor Eli M. Remolona, Jr. earlier said that inflationary pressures could cause the central bank to pause its easing cycle, but a slowdown in growth may leave room for another rate cut.

Depending on the data, he said the Monetary Board may cut again or pause at its Dec. 19 meeting.

The BSP has delivered a total of 50 bps worth of rate cuts so far this year after it made 25-bp reductions at its August and October meetings. — Charles Worren E. Laureta with Reuters

India’s floating solar plans run into opposition from fishing communities

XAVIER SMET-UNSPLASH

MUMBAI — Early each morning, fisherman Nitin Birute casts his net into the backwaters of Jayakwadi Dam in western India, catching enough fish to feed his family and make a modest living.

But he fears his livelihood could evaporate if plans to install a huge floating solar farm on the Nathsagar reservoir go ahead.

The government is considering a project to blanket about 7,500 hectares of the 350-sq. km reservoir near the town of Paithan in Maharashtra state with floating photovoltaics, part of an ambitious push to create 500 gigawatts of renewable energy capacity by 2030 — enough to power hundreds of millions of homes in the world’s most populous nation.

Details on the Jayakwadi project, which is in the early stages of planning, are not publicly available, and THDC India Limited, the state power company behind it, did not respond to requests for information about the floating solar farm’s capacity, cost or when construction might begin.

Floating photovoltaics, installed on reservoirs, lakes and offshore waters, are an emerging technology that is particularly appealing to countries with limited land resources.

But their impact on nature is a topic of debate, and environmentalists have warned that they may adversely affect people who depend on fishing and agriculture.

“We depend on this water for our food and our livelihood,” said Mr. Birute, who belongs to the local Kahar community. “If they cover the water with solar panels, what will happen to the fish?

… If there are no fish, we will have nothing left.”

About 25,000 families earn their living from the reservoir.

Earlier this year, hundreds of fisherfolk and their families protested against the planned solar farm, and one group is pursuing a legal challenge to stop construction.

India targets net zero emissions by 2070, a priority for a country that ranks among the world’s most vulnerable to the extreme weather caused by climate change. The government also wants to reduce the reliance on costly fossil-fuel imports to sustain economic growth and development.

Financial institutions have committed $386 billion to support green projects in India, Pralhad Joshi, the federal renewable energy minister, said in September.

Developing land-based solar projects in India has been delayed by land acquisition issues that are complicated by unclear records, inflated prices and potential local conflicts.

Only a small section of the reservoir will be used for the project, leaving ample space for fishing communities, said Bhagwat Karad, a lawmaker who first proposed the idea of floating photovoltaics on the Nathsagar reservoir.

A floating solar farm may help reduce water evaporation in Jayakwadi Dam, located in a region that is prone to drought, and the plant will generate inexpensive electricity for nearby residents, Karad told the Thomson Reuters Foundation.

“The government will implement the project after discussions with the fishermen and will make sure that no one is left behind,” Mr. Karad said.

But for Jayakwadi’s fishing community, the promise of clean energy is overshadowed by fears of losing their centuries-old way of life. Long before the dam was built, their forebears fished the rivers and streams that feed Jayakwadi, one of Asia’s largest earthen dams with 27 gates that regulate the flow of the Godavari River.

“They talk about saving water and producing cheap electricity, but no one is talking about what will happen to the people who depend on this water for their survival,” Bajrang Limbore, a local activist leading protests against the project, told the Thomson Reuters Foundation.

The Kahar Samaj Panch Committee, which represents the fishing community, lost a legal case in September to stop the project on the grounds that construction is restricted in the ecologically sensitive area. The National Green Tribunal, which rules on environmental cases in India, said the group had failed to show that the law prohibits developing a floating solar farm in the area.

The group’s lawyer Asim Sarode plans to take the case to the Supreme Court.

“This isn’t about opposing renewable energy,” Mr. Sarode said. “We all want clean energy. But it has to be done in a way that doesn’t destroy people’s livelihoods or harm the environment.”

Jayakwadi is home to a bird sanctuary visited by migratory birds like flamingos, spoonbills and storks and 67 types of fish, including Indian major carp, a source for aquaculture at Nathsagar.

Kishor Pathak, honorary wildlife warden for the Chhatrapati Sambhaji Nagar area, where the dam is located, warns that the installation of solar panels could disrupt the entire ecosystem.

“The aquatic plants and animals in the dam rely on sunlight to survive,” he said. “If the panels block that sunlight, the whole food chain could collapse — from the fish to the birds that come here to feed.”

Sewage from 60 villages and the city of Chhatrapati Sambhajinagar flows into the reservoir, but Mr. Pathak said aquatic life acts as a natural filter.

A hydroelectric plant on the banks of the river has been idle since December as it awaits maintenance, an engineer at the facility said on condition of anonymity.

“Why don’t they fix what’s already built before starting another project?” said the activist Limbore.

Generations of the Kahar, who were once palanquin bearers before the human-powered sedans became obsolete in India, have depended on fishing, a critical source of income for an impoverished community that lacks access to healthcare, education and housing.

“We don’t know anything else but fishing,” says Kusum Bai, an elderly Kahar woman.

“The water is sacred to us, like the holy Ganges. If they take that away, we have nothing left.” — Thomson Reuters Foundation

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