Ban on house workers to Kuwait remains

February 6, 2020 | 8:25 pm

THE DEPARTMENT of Labor and Employment (DoLE) on Thursday announced the partial lifting of the total deployment ban on overseas Filipino workers (OFWs) to Kuwait, which excludes household service workers.

Labor Secretary Silvestre H. Bello III, in a briefing with reporters, said the decision came after a meeting with the governing board of the Philippine Overseas Employment Administration (POEA).

“The governing board of the POEA just came up with a resolution lifting the ban partially… so exempted from the ban are the skilled workers, professionals, including the semi-skilled workers,” he said.

This covers both new hires and returning OFWs.

The deployment of household service workers remains prohibited.

POEA declared the total deployment ban in January after Filipino household worker Jenalyn Villavende died from injuries sustained from her abusive employers.

Similar cases of abuse have been reported in the past.

Mr. Bello said Kuwait authorities have already agreed to the provisions of a new contract template drafted by DoLE.

“The proposed harmonized contract of employment was agreed upon by the government. It’s a measure that will provide effective and sufficient protection to our overseas workers,” he said. — Gillian M. Cortez

Clark SEA Games facilities to be used as quarantine site for repatriated Filipinos from Hubei

February 6, 2020 | 8:23 pm

FACILITIES AT the New Clark City used during the 2019 Southeast Asian Games will be used as quarantine site for Filipinos repatriated from Hubei, China amid the spread of the 2019 novel coronavirus (nCoV).

Health Secretary Francisco T. Duque, in a briefing on Thursday, said the facilities inside the Athletes’ Village were offered by the Bases and Conversion Development Authority (BCDA).

The voluntary repatriation was recommended by the DoH due to the rising nCoV cases, now at about 28,000 worldwide with nearly 600 deaths, mostly in China.

“We want to bring back our fellow Filipinos here in the country as seamlessly and efficiently as possible. Procedures were set into place from the moment our OFW (overseas Filipino worker) kababayans board the plane up until their arrival to the New Clark City,” he said.

The returning Filipinos will be in isolation for 14 days and screened by the Bureau of Quarantine (BOQ).

Those found with symptoms will be considered persons under investigation (PUIs) and will be admitted in accredited hospitals.

Department of Foreign Affairs (DFA) representatives are currently on the ground in Wuhan to facilitate the repatriation.

Mr. Duque also announced that there are 178 PUIs across the country as of Thursday.

Of the total, “146 are currently admitted and isolated, 10 have refused admission, and 16 have been discharged but are under strict monitoring.”

There have been three confirmed cases in the Philippines, all Chinese nationals, including the first nCoV-related death outside China. — Gillian M. Cortez

Solar panels at 1 of Mayon Volcano’s monitoring stations stolen

February 6, 2020 | 8:22 pm

TWO 150-watt solar panels at the Mayon Rest House monitoring station have been stolen, the Philippine Institute of Volcanology and Seismology (Phivolcs) reported in Thursday. The theft was discovered on February 5 by Phivolcs personnel during routine inspection and preventive maintenance service. “With loss of power supply, no data will be transmitted from this station and consequently will affect the monitoring of Mayon Volcano,” Phivolcs said. The station houses earthquake monitoring equipment, Global Positioning System (GPS) device, and tilt meter. It is one of several observation posts feeding data to the Mayon Volcano Observatory. Undersecretary Renato U. Solidum, Jr., officer-in-charge of Phivolcs, called on the public to “help in taking care of our monitoring instruments and to promptly report any untoward incidents” as he warned that taking or tampering with the government’s disaster management equipment is punishable under Republic Act 10344.

Iloilo hotels, restaurants see minimal nCoV impact as local travelers keep bookings

February 6, 2020 | 8:20 pm

THE SERVICES sector in Iloilo, particularly hotels and restaurants, are seeing minimal impact from the novel coronavirus (nCoV) threat as the industry relies more on the local travel market. The lloilo Hotel, Restaurants & Resorts Association (IHRRA) said booking cancellations in the metro due mainly to cancelled flights is about 10%. “So far, we are not experiencing that much amount of cancellations, the cancellations remained minimal,” IHRRA spokesperson Happy C. Abenir said. IHRRA is composed of 78 members based in Iloilo City and neighboring towns. “We are not really dependent on foreign tourists. We are catering to a number of local tourism, people who come here to take care of business, do investments and check the place out,” she said. The entire Iloilo province recorded 1.24 million tourists in 2018, of which over 90% were local travelers.

nCoV PREPARATIONS
At the same time, the Iloilo provincial and city governments, along with the local offices of national agencies, have set measures to prevent and respond to nCoV cases. Among these steps is the creation of a task force that will focus on monitoring hotels and restaurants in the city. “We want to focus on the hotels and restaurants so that we can perform contact tracing afterward once there are suspected cases of 2019-nCoV,” Iloilo City Mayor Jerry P. Treñas said on Monday. Ms. Abenir said the IHRRA members have also committed to implement protocols on handling guests, especially those coming from countries with confirmed nCoV cases. “We have adapted and agreed on handling guests who have symptoms of fever, cough, and not feeling well. First, we will get in touch with the DoH (Department of Health), City Health Office. Then they will send a team with a doctor and a nurse to monitor and check the patient and they will make certain recommendations,” she said. Governor Arthur R. Defensor Jr., meanwhile, has also ordered the setting up of an isolation room at the Dr. Ricardo Y. Ladrido Memorial District Hospital, while Iloilo City will use the La Paz Maternity and Reproductive Health Clinic.

PARAW REGATTA POSTPONED
Meanwhile, Mr. Treñas has ordered the postponement of the Iloilo-Guimaras Paraw Regatta Festival and other big events in the city for February. “Upon consultation with the Department of Health-Region 6, City Health Office, and the organizer, Iloilo Festivals Foundation Inc. (IFFI), we decided to postpone the festival as a precautionary measure against nCov,” he announced Wednesday. The annual festival, with the main events set this year on Feb. 23-March 1, will be moved to a later date. The Paraw Regatta, which celebrates the Visayan double outrigger boat, is considered the oldest sailing event in Asia and the biggest in the Philippines. As of Feb. 4, the Iloilo City has recorded two persons under investigation for nCoV. — Emme Rose S. Santiagudo

Marsman Estate says P90,000/ha offer still stands for over 100 farmers

February 6, 2020 | 8:19 pm

MARSMAN ESTATE Plantation Inc.’s (MEPI) offer of a P90,000 per hectare (ha) payment annually to 140 banana farmers remains on the table, the export company said. In a statement on Wednesday, MEPI said 622 of the 762 members of the Davao Marsman Agrarian Reform Beneficiaries Multi-Purpose Cooperative (DAMARB-MPC) have agreed to the new deal, which is contained in their amended contract signed last December. “We would like everybody in the community to share in the fruits of the land without leaving anybody behind,” MEPI President and Chief Operating Officer Victor S. Mercado Jr. said. The revised contract between the company and DAMARB-MPC also paved the way for the advanced payment of the annual rental fee for three years, or until 2022. The agreement also specifies that a member of the ARB family will be provided with “with education, health care, life insurance, retirement benefits, and other financial assistance.” The cooperative informed the Presidential Agrarian Reform Council about the new contract on January 7. MEPI, a member of the Marsman Drysdale Group, has been operating a banana plantation since 1969, covering about 2,000 ha in Sto. Tomas town in Davao del Norte. In compliance with the Comprehensive Agrarian Reform Law, the company donated in September 2000 about 800 hectares to farmer beneficiaries with the condition that it be allowed to lease the area for 30 years, initially at P4,500/ha a year. — Carmelito Q. Francisco

Nationwide round-up

February 6, 2020 | 8:19 pm

House legislators also call for DICT P300M fund probe

THE MAKABAYAN bloc in the House of Representatives, with support from the members of the minority, has filed a resolution seeking to investigate the alleged misuse of P300 million in confidential funds in the Department of Information and Communications Technology (DICT). The allegation was made by former DICT undersecretary Eliseo M. Rio, Jr., who recently resigned over the issue. The Senate is also planning to hold an inquiry. “We have received reports that these anomalous funds were used for surveillance. The question is who were put under surveillance? Were the opposition and other critics been put under surveillance? Is this part of the National Task Force- End Local Communist Armed Conflict (NTF-ELCAC) to monitor and suppress the opposition? Is that even part of the mandate of the DICT? This should definitely have to be probed and Congress’ oversight powers should be exercised to investigate this,” Bayan Muna Party List Rep. Carlos Isagani T. Zarate said in a press conference on Thursday, streamed on Facebook. The filed House Resolution 702 cites that “the cybersecurity office of the DICT is not created for surveillance of civilians; it was created instead to secure the nation’s cyber space from cyber threats.” It also said, “The conduct of surveillance and intelligence activities is nowhere to be found in the DICT charter, which questions the use of P400 million of the confidential funds allocated on the agency for Fiscal Year 2019.” Mr. Zarate also called on the House leadership to immediately pass House Bill 6184, which seeks to create the Congressional Oversight Committee on the national budget. A Commission on Audit observation memorandum dated Jan. 20 said the DICT advanced P300 million in cash for confidential expenses on three occasions — P100 million each on Nov. 22, Dec. 2 and Dec. 17 last year. These were made in the name of current DICT Secretary Gregorio B. Honasan III, who also requested the funds, which were to be used for “confidential expenses in connection with cybersecurity activities.” — Genshen L. Espedido

Medialdea to head National Quincentennial Committee

EXECUTIVE SECRETARY Salvador C. Medialdea will lead the committee for the celebration of the 500^th anniversary of the first circumnavigation of the world, in which the Philippines was one of the stops. Under Executive Order No. 103 dated Jan. 28, President Rodrigo R. Duterte directed the reconstitution of the National Quincentennial Committee, which will be in charge of all government initiatives for the 2021 Quincentennial Commemorations in the Philippines (2021 QCP). The 2021 QCP aims to promote nationalism and tourism. Among the historical events that will be commemorated is Ferdinand Magellan’s arrival in the Philippine islands and the victory of Lapu-Lapu in the battle of Mactan. The head of the National Historical Commission of the Philippines (NHCP) will be the committee’s vice chair. — Gillian M. Cortez

[B-SIDE Podcast] GDP growth falls to eight-year low in 2019

February 6, 2020 | 1:02 pm

BusinessWorld Editor-in-Chief Willy G. Reyes and Research Head Leo Uy on how and why the Philippines missed its growth targets for 2019. The country’s full-year gross domestic product (GDP) of 5.9% is the lowest in eight years. Also discussed: what to watch for in the coming months and the country’s economic prospects. Produced by Nina M. Diaz, Paolo L. Lopez, and Sam L. Marcelo.

Jan. inflation fastest in 8 months

February 6, 2020 | 12:33 am

THE overall year-on-year increase in prices of widely used goods picked up for the third straight month in January by its fastest pace in eight months, the government reported on Wednesday.

Preliminary data from the Philippine Statistics Authority (PSA) showed headline inflation at 2.9% last month, picking up from the 2.5% pace in December, albeit still slower than the 4.4% inflation rate in January 2019.

The January inflation result marked the fastest pace in eight months or since the 3.2% reading in May 2019.

The latest headline figure is higher than the 2.7% median in a BusinessWorld poll conducted late last week and falls within the 2.5-3.3% estimate given by the Bangko Sentral ng Pilipinas (BSP) for January, and 2-4% for the year.

Core inflation, which discounted volatile prices of food and fuel, stood at 3.3% in January, picking up from 3.1% the previous month and the fastest since the 3.5% in May 2019.

The PSA noted higher annual increases in the following commodity groups: food and non-alcoholic beverages index (2.2% from 1.7% in December 2019); alcoholic beverages and tobacco (19.2% from 18.4% in December 2019); clothing and footwear (2.7% from 2.6%); housing, water, electricity, gas, and other fuels (2.5% from 1.9%); transport (3% from 2.2%); recreation and culture (1.5% from 1.4%); and education (4.7% from 4.6%).

The food-alone index also posted an inflation rate of 2.1%, an increase from December 2019’s 1.7%.

“After a faster-than-expected pickup in December, headline CPI (consumer price index) inflation again surprised consensus expectations,” Euben Paracuelles, chief ASEAN economist at Nomura Holdings, Inc., said in a research note.

ING Bank NV-Manila Senior Economist Nicholas Antonio T. Mapa noted the uptick in food prices as the main driver of inflation.

“We had expected the uptick in inflation with select food items posting higher inflation on supply disruption and crop damage from twin storms in December and the [Taal] volcanic eruption in January of this year. Meanwhile, excise taxes were levied on sin products and fuel, pushing up prices for related items in January as well,” Mr. Mapa said in an e-mail.

Albay Rep. Jose Ma. Clemente S. Salceda, chairman of the House Committee on Ways and Means, said last month’s inflation “was driven in large part by price pressures due to Taal activity.” He cited, in particular, the price pickups observed in fish, meat, and vegetables.

Bank of the Philippine Islands (BPI) Lead Economist Emilio S. Neri, Jr. said that along with the increase in sin taxes, the hike in oil prices have also contributed to January’s uptick.

“Despite recent reductions in petroleum prices [that might reflect in the February reading], LPG (liquefied petroleum gas) prices increased early January, which was reflected in the faster price hikes in utilities,” Mr. Neri said in a phone interview.

INFLATION IMPACT FOR THE POOR
Likewise, the PSA reported preliminary figures for inflation as experienced by low-income families for January. That month, inflation for the bottom 30% of income households grew 2.6%, faster than the 2.1% in December, but slower than the 4.9% in January 2019.

The CPI for the bottom 30% reconfigures the model basket of goods in order to reflect the spending patterns of the poor. This compared to the headline CPI which measures inflation as experienced by the average household.

This also marked the first time the bottom 30% CPI used 2012 prices as the base year. Prior to the rebasing, the bottom 30% CPI used 2000 prices.

ING’s Mr. Mapa said that the increase in inflation as experienced by the low-income families was “expected.”

“The switch to the new base year gives a more accurate picture of what the bottom 30% household purchase as PSA updated both the composition and weighting of such…[Now, we can] be more confident of being able to monitor price trends for this segment more accurately,” he told BusinessWorld.

“Just like headline inflation for all of the Philippines, we expect inflation for the bottom 30% to inch higher in 2020, bounce, then settle as base effects fade out,” he added.

RISKS AND OUTLOOK
“Despite the relatively stable inflation outlook, we cannot be complacent, as the balance of risks remains on the upside for 2020 due to the effects of the Taal Volcano eruption, spread of African Swine Fever, and novel coronavirus (2019-nCoV),” Socioeconomic Planning Secretary Ernesto M. Pernia was quoted in a statement by the National Economic and Development Authority as saying.

In a mobile phone message to reporters, BSP Governor Benjamin E. Diokno said the central bank would be considering both downside and upside pressures on succeeding inflation readings.

“The staff is reviewing the inflation outlook in the light of falling world crude prices. It is also revisiting the likely impact of the coronavirus on the global and Asian economies — both in the short-term and medium-term. These are two of the major factors in the decision making process in [today’s] policy meeting,” BSP Governor Benjamin E. Diokno said in a mobile phone message to reporters.

ING Bank’s Mr. Mapa also looked at the immediate impact of the novel coronavirus (2019-nCoV) outbreak.

“The 2019-nCoV will likely alter consumer behavior, pushing up consumption in medical supplies and groceries as consumers opt to stay indoors and avoid unnecessary trips to the mall and crowded areas. This likely forces prices for basic food stuffs higher while inflation for restaurants and others will dip on depressed demand,” he explained.

In a research note, Mr. Mapa expects inflation “to inch higher and ‘bounce then settle’ as reverse base effects from the 2019 inflation lows nudge prices higher in 2020” with inflation to average 3.2% for the year, albeit peaking in the third quarter.

“Despite the uptick in inflation, we expect the BSP to cut policy rates by 25 basis points (bps)…,” Mr. Mapa said.

For BPI’s Mr. Neri: “With inflation still below 3%, the BSP may cut its policy rate by 25 bps in its February policy meeting.”

However, Mr. Neri told BusinessWorld that a 25-bp cut could be a “one-and-done” cut. “Personally, I won’t recommend any other cuts more than 25 bps considering the upward inflationary pressures of factors mentioned.”

On the other hand, Nomura’s Mr. Paracuelles expects the BSP to keep policy rates unchanged at 4% in Thursday’s monetary policy meeting.

“The further pick-up in headline inflation in January was within BSP’s projected range of 2.5-3.3% as opposed to materially surprising to the downside, which supports our call for BSP to keep policy settings stable. We think BSP will likely err on the side of caution, and pay particular attention to the fact that, on a month-on-month seasonally adjusted basis, headline inflation at 0.4% is relatively strong and is the second highest on record since late 2018. The same is true for core inflation,” Mr. Paracuelles said.

“Still, we assign a 70% likelihood to our forecast of unchanged policy rates and a 30% chance to a 25-bp cut, which reflects comments by Governor Benjamin Diokno that BSP has policy space…,” he added.

The BSP’s Monetary Board will meet today to discuss policy. — Carmina Angelica V. Olano, with inputs from Mark T. Amoguis, Genshen L. Espedido, and Luz Wendy T. Noble

Headline inflation rates in the Philippines (January 2020)

February 6, 2020 | 12:33 am

THE overall year-on-year increase in prices of widely used goods picked up for the third straight month in January by its fastest pace in eight months, the government reported on Wednesday. Read the full story.

Social-savvy nation battles coronavirus fake news

February 6, 2020 | 12:32 am

By Norman P. Aquino Special Reports Editor
and Arjay L. Balinbin Reporter

A FACEBOOK POST in the Philippines shared more than 2,000 times claimed a coronavirus strain that has killed hundreds in China and sickened thousands more is “a type of rabies.”

The dubious health advice, which included graphics of a bat, claimed bats should not be eaten because they eat mosquitoes that have dengue. The cross between dengue and rabies has resulted in a mutated coronavirus, according to the Facebook post that has since been removed.

But coronavirus and rabies are clearly two different virus types. Rabies affects the central nervous system and can be prevented with a vaccine, while coronavirus is a respiratory ailment that has no cure yet, according to the World Health Organization (WHO).

“It is actually close to ridiculous to think that [coronavirus] is now falling within the family of rabies,” Health Secretary Francisco T. Duque III said at a briefing on Jan. 28.

And while scientists suspect the deadly coronavirus strain may have originated from a market in Wuhan City in China, they have yet to conclude which animal had originally transmitted the virus to humans.

The WHO has declared a global health emergency as the virus spread to more than 20 countries, including the Philippines.

WHO cited the potential for the virus to spread to countries with weaker health systems, and which are ill-prepared to deal with it.

The Philippines confirmed its third coronavirus case yesterday after the second one died, the first reported death outside China.

Nearly 500 people have died in China, while about 20,000 more have been infected worldwide, mostly in China, according to WHO data.

The number of people under investigation for coronavirus in the Philippines has risen to 133, while 16 have been discharged but were being strictly monitored, according to the Health department.

President Rodrigo R. Duterte has banned the entry of foreigners from mainland China, Hong Kong and Macau to prevent the virus from spreading.

Fake news and information about coronavirus have spread like the virus itself on social media, with users sharing misleading and false advice about the health menace.

One such claim — shared 16,000 times on Facebook — urged people in the Philippines to “keep your throat moist,” avoid eating spicy food and “load up on vitamin C” to prevent infection.

WHO and local health authorities have recommended regular hand washing, covering your mouth and nose with a tissue when coughing and sneezing, thoroughly cooking meat and eggs, and avoiding close contact with anyone showing symptoms of a respiratory illness.

Another Facebook video post by a Filipino showed exotic animals such as snakes, bats, rats and other meat being sold at what the poster claimed was a market in Wuhan City, where the novel coronavirus strain was first detected.

But it was actually filmed at an Indonesian market, according to international news agency AFP.

OUT OF STOCK
Filipinos are very susceptible to fake news because they are one of the world’s most active social media animals, Vanessa G. Oyos, a spokeswoman for the Consumers Union of the Philippines, said by telephone.

“Fake information is rampant on social media and consumers have to be mindful of their actions,” she said.

False news has also sowed confusion and fueled unnecessary hysteria.

In the Philippines, face masks are out of stock at most drugstores due to panic buying, forcing 53-year-old tutor Leah A. Cuenco to make her own.

“It’s pretty easy to make one,” Ms. Cuenco, a self-confessed DIY (Do It Yourself) enthusiast, said in an interview. “You just need a roll of garter and a piece of soft cloth.”

She’s been giving away washable face masks to family members since Taal Volcano emitted a plume of ashfall that reached cities around Metro Manila last month.

A pharmacist for a generic drugstore at a busy street corner in Las Piñas City told BusinessWorld they only had five boxes of surgical face masks in stock.

“We ran out of it fast even if we limited the number of masks that people could buy to 10 pieces,” she said. “We don’t know when the next stock will arrive.”

The Trade department has fined 18 shops in the capital, Manila, for selling overpriced face masks since Taal Volcano’s eruption last month, Trade Secretary Ramon M. Lopez said by telephone.

The retail shops had been fined P300,000 each for violating the Consumer Act, particularly for jacking up face mask prices and taking advantage of the situation, he said.

Prices of regular surgical face masks have been overpriced by as much as P10 each, while prices of N95 respirators have jumped to P180 from P50 each, Mr. Lopez said.

“People tend to resort to panic buying when there’s fake news,” he said.

The agency has also issued notices to online stores Lazada and Shopee, where N95 respirators were being sold for as much as P224 each. The e-commerce sites face a P300,000 fine if they fail to explain the overpricing, Mr. Lopez said.

Some of the virus’ unexpected victims are people who have never even been anywhere near Wuhan.

Asian communities in the US, Canada and Europe have complained of racist and xenophobic incidents against them, as fears over the China outbreak grow, according to the Business Insider.

In the Philippines, there’s also a racist backlash against Chinese nationals employed by online gaming companies, leading Mr. Duterte to clarify his policy about the travel ban.

The President on Feb. 3 said Chinese travelers from other countries may enter the Philippines.

“We can assure the Chinese government that we too will help,” he said in a speech. Blaming the Chinese for the outbreak is “xenophobia.”

The Justice department on Wednesday said people who publish false information online about coronavirus face cybercrime-related charges.

“The nCoV threat is a very serious public concern and no distraction of government efforts to overcome it will be tolerated,” Justice Secretary Menardo I. Guevarra said, referring to the virus’ clinical term.

Factory output continues slump, down for 13th straight month in Dec.

February 6, 2020 | 12:31 am

By Jobo E. Hernandez

INDUSTRIAL PRODUCTION extended its declining streak to the 13^th straight month in December, the Philippine Statistics Authority (PSA) reported on Wednesday, with economists attributing the continued slump to tepid global demand.

Preliminary results of the PSA’s latest Monthly Integrated Survey of Selected Industries showed factory output — as measured by the volume of production index (VoPI) — contracting by 10.1% in December versus the declines of 7.8% in November 2019 and 9.3% in December 2018.

For full-year 2019, the factory output slump averaged 8.6% compared to the 7.1% growth average in 2018.

Factory output has been on a decline since December 2018, with the January result extending this losing streak to 13 straight months. This streak also surpassed the 12-month slump recorded between November 2008 and October 2009.

The PSA noted production of eight out of 20 industry groups fell in December, namely: petroleum products (-47.9%); basic metals (-47.9%); furniture and fixtures (-30.4%); miscellaneous manufactures (-10.5%); textiles (-9.1%); transport equipment (-3.4%); rubber and plastic products (-1.2%); and paper and paper products (-1.1%).

Average capacity utilization — the extent by which industry resources are used in the production of goods — was estimated at 84.4% with 12 of the 20 sectors registering capacity utilization rates of at least 80%.

“Manufacturing production continued to drop because of global trade tensions that have constricted markets and constrained demand,” University of Asia and the Pacific (UA&P) economist Cid L. Terosa said in an e-mail.

In a separate e-mail, UnionBank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion noted the manufacturing indices of advanced economies began to fall around the last quarter of 2018 and the start of 2019, “indicating a global slowdown in manufacturing activities.”

“The slowdown is a result of a confluence of factors. One is the pervasive uncertainty brought about by the US-China trade war in its early stages. Another was the anticipation that the global growth trend is on its tail end at the usual cycle of real growth [since the global financial crisis in 2008-2009],” he said.

Mr. Asuncion cited slowing global demand as another factor in the sector’s sluggish performance last year. “In the case of the Philippines, its economy is now more than ever intertwined with the global economy and its tendencies. One can observe this in the behavior of trade and its subsequent growth,” he said.

Mr. Asuncion said factory output is seen to pick up in 2020, noting the country’s PMI (Purchasing Managers’ Index) figures in January “were higher than expected.”

The Nikkei Philippines PMI reading reached 52.1 in January, higher than 51.7 in December and 51.4 in November. The January PMI figure matched that of October and was the strongest improvement since January 2019’s 52.3 print.

A reading above 50 signals improvement in business conditions from the preceding month, while a score below that point indicates deterioration.

While the VoPI and the PMI both seek to measure performance of the manufacturing sector, they differ mostly in terms of methodology used. The VoPI looks at the percentage change in production volumes in a particular period relative to a base period. On the other hand, the PMI indicates whether the proportion of respondents that reported an increase outweighs those that reported a decrease as regards to indicators such as output, new orders, inventory, employment, input, selling prices and sentiment over the following 12 months.

“This pickup may be derailed momentarily by the outbreak of the 2019-nCoV (novel coronavirus). However, manufacturing production growth is still likely to recover and will potentially pick up this year,” he said, referring to the novel coronavirus outbreak that led to nearly 500 deaths and infected more than 20,000 mostly in China.

For UA&P’s Mr. Terosa, manufacturing production will likely be slow in the first quarter with the coronavirus outbreak having adversely affected activity in global markets.

“Growth may start to pick up during the second half of the year,” Mr. Terosa said.

In a statement issued by the National Economic and Development Authority (NEDA), Socioeconomic Planning Secretary Ernesto M. Pernia stressed the need to support initiatives towards digital solutions in the private sector to boost growth in the manufacturing sector, as well as build up the capacity of the country’s labor force in meeting emerging market demands and expand from the production of basic products to higher value products for local consumption and export.

“We encourage industries to capitalize on innovation to reach their growth potential in this era of the Fourth Industrial Revolution. To this end, the government needs to formulate and implement policies and programs to stimulate innovation in the country,” Mr. Pernia was quoted in the statement as saying.

Coronavirus seen to weigh on Asia’s growth in 1st half

February 6, 2020 | 12:30 am

THE NOVEL CORONAVIRUS (2019-nCoV) outbreak is seen to weigh on Asia’s economic growth in the first half of 2020, Fitch Solutions Macro Research said on Wednesday.

The research arm of the Fitch Solutions Group said the Philippines, along with Cambodia and Thailand, are expected to be the most affected as China banned outbound travel of its citizens.

“We at Fitch Solutions see significant downside risks to Asia’s growth outlook, particularly in the first quarter, due to the Severe Acute Respiratory Syndrome (SARS)-like novel coronavirus (2019-nCoV) outbreak in China,” Fitch Solutions said in an analysis of the downside scenarios of the coronavirus on Asian growth.

The death toll from the virus reached 490 in mainland China, as of Tuesday, Reuters reported. The total accumulated number of confirmed infections has reached nearly 25,000, mostly in mainland China.

“Notably, while the WHO (World Health Organization) has established that the coronavirus is more infectious than the 2003 SARS virus, it is currently proving to be less deadly. Nevertheless, over the coming months we believe that the coronavirus epidemic will weigh on Asia’s growth at least in the first half of 2020,” Fitch Solutions said.

If the China’s economy will expand at a slower pace of 5.4% in the first half, Fitch Solutions said the overall expansion of Asia could slow down to 4% this year from 4.3% last year, while the emerging Asia may grow by 5.4% this year, slower than last year’s 5.7% print.

It noted that “disruption in China will dampen regional growth” as China accounts for 70% of emerging Asia’s economic expansion, nearly 80% of Asia-wide travels within the region, and receives 40% of total exports of goods in Asia.

At the same time, Fitch Solutions said the stoppage of outbound travel from China is seen hurting Southeast Asian countries’ tourism sector, particularly Cambodia and Thailand. Chinese tourists made up 27.6% of the 39.7 million tourists to Thailand last year, according to the World Travel & Tourism Council.

“The Chinese government’s strict containment response will likely have a prolonged negative impact on domestic demand and output by businesses, which will spill over into trade momentum,” it said.

Fitch Solutions also flagged the rising risks of a prolonged pandemic spreading across Asia, saying countries with poor health care systems will be most affected.

“Many countries could be vulnerable to disruptive work stoppages and a loss of productivity, as many of them are ill-equipped to address the spread of the virus domestically. We particularly highlight risks to countries that have limited fiscal space with high levels of government debt-to-GDP ratio and less developed health care systems,” it said. — Beatrice M. Laforga

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