Popular restaurateur and former paparazzi Roberto Bellini, 84

November 28, 2024 | 12:05 am

Fred's-Revolución — FACEBOOK.COM/FREDSREVOLUCION

ROBERTO BELLINI, founder of Cubao’s once-secret, mural-covered Italian restaurant, passed away on Nov. 24 at the age of 84.

His passing was confirmed in a Facebook post by one of his daughters, Joy Bellini.

Most fans of the restaurant learned of his death when chef Waya Araos-Wijangco said in a Facebook post, “330. Godspeed Roberto Bellini! Your little shop in Cubao was home to many memories for our family. We learned about Italian food from you, in the accessible, friendly and unpretentious space you made. I will always remember our run-ins and friendly banter at Farmers Market. You are a legend. Salute!”

The restaurant, founded in 1999, used to be a well-kept society secret, entertaining celebrities, politicians, and bohemians (thanks to its relatively accessible prices) alike. It stopped being a secret in its Cubao Expo location with the release of the 2007 film One More Chance, which had scenes set there. One of the film’s stars, John Lloyd Cruz, had kept in touch with Mr. Bellini through the years, greeting him on his birthday in January, recalling that the restaurateur told him, “You have to work, John Lloyd.” An earlier post in 2018, shows the actor with Mr. Bellini, “the only paparazzi I love.”

Being behind the camera was Mr. Bellini’s life prior to settling in the Philippines with his wife and three children.

According to a profile on Esquire by the late journalist Regina Abuyuan, Mr. Bellini had photographed Diana, Princess of Wales, Frank Sinatra, Ella Fitzgerald, Julio Iglesias, and Tom Cruise, among others. Remnants of this past life can be seen on a wall of his restaurant which is nearly papered in his celebrity shots.

Ms. Abuyuan happened to be the co-founder of Fred’s Revolucion, Bellini’s Cubao Expo neighbor. Accordingly, the bar posted a tribute to Mr. Bellini on their Facebook page: “Buonanotte, nostro Principe” (Good night, our prince), accompanied by a photograph of their bar with a sign for Mr. Bellini, reading “Ti Vogliamo Bene” — a phrase that expresses love in Italian, literally meaning “We want the best for you.”

Hailing from Pisa and born on Jan. 3, 1940 to a family in the restaurant and hotel industry, Mr. Bellini trained to be a paratrooper and entered military service, before turning to the film camera.

To patrons of Cubao Expo, he will always be the friendly man sending free drinks to first-timers (and, if he remembered your face, on the next visit), in a pastel shirt with a few buttons open, exposing a gold chain. He would be out in the last few hours of daylight, supervising things before his restaurant opened. — J. L. Garcia

Cop29 climate finance deal: Why poor countries are so angry

November 28, 2024 | 12:04 am

After a fortnight of bitter struggle, nearly 200 countries agreed on a new goal to raise money to tackle the climate crisis at Cop29, the 29^thannual UN climate conference in Baku, Azerbaijan.

Rich countries agreed to take the lead in paying $300 billion a year to the poorest nations by 2035 from a variety of financial sources (public, private, between countries, and across multilateral sources like development banks). This is less than a quarter of what developing countries asked for, and not in the form of the no-strings-attached grants money that they need.

There is no consensus on how to define “climate finance” within the United Nations Framework Convention on Climate Change (UNFCCC), the UN process for negotiating an agreement to limit global warming. Developed countries prefer a mélange of public and private funding sources, including loans and “debt swaps” (reducing or forgiving a country’s debt in exchange for that country investing money into projects that protect the environment or fight climate change). Their preference is reflected in the final Cop29 decision.

These same developed countries are responsible for most of the greenhouse gas emissions that are heating Earth to dangerous levels. Developing countries have demanded a share of their immense wealth to help them cut emissions, adapt to the impacts of a warming climate, and address the consequences of existing disasters (what is generally referred to as loss and damage). The UNFCCC estimates that developing countries need $5 trillion to $6.9 trillion to implement their national climate plans by 2030.

The original climate finance target was set in 2010 and is due to expire in 2025. This encouraged rich nations to funnel $100 billion to the developing world annually, but it was only met for the first time in 2022.

Negotiators from poor nations are right to be frustrated. While the latest UN Intergovernmental Panel on Climate Change report suggests that there is enough money in the global economy to properly fund a green transition, the financial system is systemically skewed against developing countries.

DEBT AND INEQUALITY
The World Bank and other international monetary institutions were conceived at the end of the second world war, before many of the countries they affect had gained independence, calling into question the legitimacy of a global regime conceived in the colonial era.

In 2022, 58 of the world’s poorest and most climate-vulnerable countries spent $59 billion repaying debts compared to the $28 billion they received in climate finance, over half of which were loans.

The cost of borrowing money can be up to seven times higher for developing countries than the US and Europe. This is because lenders see poorer countries as riskier places to invest, given their perceptions of political instability or low credit ratings. This arrangement entrenches inequality.

Poor countries like Bangladesh that are increasingly exposed to extreme weather need more and more money to adapt. When this money is provided in the form of loans, the interest traps them in a downward spiral of mounting debt.

‘YOU OWE US’
Countries that bear the least responsibility for climate change suffer its harshest consequences. It is estimated that between 2000 and 2019, 55 of the countries most vulnerable to climate change lost $525 billion to impacts like sea-level rise and storms despite accounting for 4% of global emissions.

The UNFCCC acknowledges that countries have different abilities but also a common responsibility to mitigate climate change. While the UN process affirms the inequality of resources, power, and historical contributions among countries, it does not provide recourse to address these imbalances.

In fact, vulnerable countries are already owed a great deal for paying the price of a crisis they did not produce. Purely in terms of emissions, this “climate debt” has been calculated at $5 trillion annually, or $192 trillion by 2050.

Even without climate change, research has found that developed countries owe developing countries $10 trillion a year for the land, labor, and resources the former extracts from the latter for its economic growth and development.

LET THE MARKET FIX IT
Whether solutions to climate change are “cost-effective” has motivated official efforts to tackle climate change since the inception of the UNFCCC in 1992.

The 1997 Kyoto protocol allowed rich countries to invest in emission-reducing projects in developing countries to meet their own targets. This was called the clean development mechanism.

In a similar vein, prior to the signing of the 2015 Paris agreement, negotiators of rich nations considered government funding insufficient for transitioning societies to net zero carbon emissions. The objective was to “shift the trillions” from the private sector by creating incentives for investment.

This put governments in a facilitating role, letting private funders take the lead in developing solar farms and restoring wetlands. This does not mean that governments disappear from the scene, however.

Instead, governments create a less risky, more attractive investment environment for the private sector by using subsidies or guarantees that the state will take on the debt if a private company cannot pay. Effectively, this process makes the public responsible for the risks of climate finance while private companies get to keep all of the financial gains.

Using loans and private finance costs rich governments the least, and financing with strings attached gives them more control over how money is spent. For developing countries, however, grant-based finance provides tangible support for addressing a climate crisis they did not create.

In such an unequal system, the first recourse has not been to cancel debt, as many developing countries have called for. Instead, companies, civil society groups, and even private financiers are being asked to fill the moral gap left by rich governments.

Jodi-Ann Jue Xuan Wang is a DPhil (PhD) candidate in International Development at the University of Oxford.

SEC approves Megawide Construction Corp.’s amendments on its DIS relative to its Special Stockholders’ Meeting

November 28, 2024 | 12:04 am

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Aboitiz group receives notice of award for Bohol airport

November 28, 2024 | 12:04 am

ABOITIZ InfraCapital, Inc. (AIC) has officially received the notice of award to upgrade, operate, and maintain the Bohol-Panglao International Airport, its parent firm announced on Wednesday, detailing its immediate plans for enhancing the Philippines’ ninth busiest gateway.

In a regulatory filing, Aboitiz Equity Ventures, Inc. said its infrastructure arm is expected to sign the concession agreement by the end of the year.

The Transportation department previously announced that Aboitiz InfraCapital would be awarded the P4.53-billion contract for Bohol-Panglao International Airport’s operations and maintenance after the Swiss Challenge ended with no other bids.

This is the group’s second airport public-private partnership project this year, following the award of Laguindingan International Airport after no other parties challenged its unsolicited proposal.

“This project is not just about upgrading facilities but also about boosting economic opportunities, enhancing tourism, and improving connectivity in the Visayas region, and we are excited to be a part of this initiative,” Aboitiz InfraCapital President and Chief Executive Officer Cosette V. Canilao said in a statement.

The company said that it will expand the passenger terminal building and modernize airside and landside facilities of the airport within its 30-year concession period.

Ms. Canilao said on the sidelines of BusinessWorld Forecast 2025 Forum on Tuesday that the company plans to tap Ireland-based daa International as its technical services provider for Bohol-Panglao airport.

Improvements and enhancements will be immediately implemented at the airport as early as next year, she told reporters.

Aboitiz InfraCapital is scheduled to take over the operations and maintenance of Bohol-Panglao International Airport by June 2025, according to the timeline set by the Transportation department.

In its statement on Wednesday, Aboitiz InfraCapital said it will invest to increase the airport’s capacity from the current two million passengers annually to 2.5 million within two years.

“These investments will enhance the passenger experience, improve operational efficiency, and elevate the airport’s safety and security standards, aligning with AIC’s vision of creating globally competitive airports that showcase the best of the Philippines,” the company said.

The company expects to finish its capacity expansion initiatives for the airport by 2030, allowing it to reach 3.9 million passengers per annum, it said.

At the stock exchange on Wednesday, shares in Aboitiz Equity fell by 40 centavos, or 1.17%, to end at P33.90 apiece. — Ashley Erika O. Jose

HONOR’s latest foldable Magic V3 now available in the Philippines

November 28, 2024 | 12:04 am

HONOR Philippines last week launched in the country its newest foldable smartphone, the HONOR Magic V3.

The new smartphone, which comes in Green and Black, retails for P89,999 and is now available via Globe Postpaid Plans starting at GPlan Plus 1799 with a free HONOR Pad X9 that is valued at P9,999. The device can also be purchased at HONOR Experience and Partner Stores and online via Shopee, Lazada, and TikTok Shop.

“It feels like just yesterday when we launched the HONOR Magic V2 and now, we are ecstatic to introduce HONOR’s newest and thinnest foldable smartphone, the HONOR Magic V3. AI (artificial intelligence) is slowly but surely reshaping our industry, enriching and creating new experiences that improves creativity and productivity for consumers all around the world, every day, and right now, it’s our priority to make comfort and technology accessible to more Filipinos” HONOR Philippines Vice-President Stephen Cheng said.

The HONOR Magic V3 has AI-enabled hardware capabilities and is the world’s thinnest inward foldable phone, the brand said.

“With a sleek folded thickness of 9.2mm and featherlight body weighing just 226g, the HONOR Magic V3 rivals the slimness and weight of a flagship bar phone, ensuring utmost portability for users. This feat is accomplished through the meticulous application of 19 innovative materials and 114 microstructures, propelling foldable devices into a new era of precision and slimness,” it said.

“Featuring a dome-shaped octagonal camera module, the HONOR Magic V3 seamlessly combines the architectural beauty of dome structures with technological innovations. This camera module showcases a diamond cut, adding an element of elegance and sleekness to the device’s overall appearance,” it added.

The foldable phone’s body incorporates a special fiber material to boost impact resistance, while the HONOR Super Steel Hinge allows the device to withstand up to 500,000 folding cycles for increased durability, along with the HONOR Super Armored Inner Screen and HONOR Anti-scratch NanoCrystal Shield.

The HONOR Magic V3 has a 6.43-inch external display and a 7.92-inch internal foldable screen.

“Dedicated to prioritizing user well-being and comfort, this device incorporates a range of innovative eye-comfort features, such as the world’s first AI Defocus Display technology, 4320Hz Risk-free PWM Dimming, Dynamic Dimming, Circadian Night Display, and Natural Tone Display,” HONOR Philippines said.

The phone also has a 5,150mAh silicon-carbon battery that supports 66W wired and 50W wireless HONOR SuperCharge.

“Featuring the innovative HONOR Falcon Camera System which encompasses a 50-MP Periscope Telephoto Camera, a 50-MP Main Camera, and a 40-MP Ultra-wide Camera, the device promises unparalleled imaging quality and versatility for users seeking stunning smartphone photography,” it added.

The HONOR Magic V3 also comes with on-device AI-enabled photography features. — BVR

9 restaurants claim the title of World’s Best, La Liste says

November 28, 2024 | 12:04 am

La Vague d'Or restaurant in France. — CHEVALBLANC.COM

WHEN the world’s best restaurant lists are announced, there’s usually one winner. Not so for La Liste, which has just awarded the top spot to nine restaurants this year using an algorithm.

The No. 1 honorees are: Le Bernardin in the US; SingleThread in the US; L’Enclume in the United Kingdom; Cheval Blanc by Peter Knogl, in Switzerland; La Vague d’Or in France; Guy Savoy in France; Schwarzwaldstube in Germany; Matsukawa in Japan; and Lung King Heen in Hong Kong. They each got a ranking of 99.5.

“It feels significant to be representing British culinary talent on this global stage,” says Simon Rogan, chef-owner of L’Enclume in the UK’s Lake District, which has retained its No. 1 spot from last year, along with five other dining rooms.

The nine-year-old La Liste’s approach differs from other rankings. Rather than rely on anonymous judges, as Michelin famously does, or individual voters, as the World’s 50 Best opts for, the Paris-based company aggregates around 1,100 sources, including a synthesis of reviews from newspapers, magazines, guidebooks, and blogs. It then uses an algorithm to compile its rankings of 1,000 dining rooms across 79 countries. (Their app lists 35,000 restaurants from 200 countries.) Its founders argue this is a more objective way of measuring top rankings.

The results aren’t surprising; for the most part, the list reads like a compendium of the most famous restaurants in cities worldwide. They’re the ones that get written about the most, like the students voted most popular in a yearbook.

But La Liste finds other ways to use its data, including recognizing a country for its burgeoning culinary scene. This year, it’s England. For established British chefs, this might feel like a backhanded compliment, but Joerg Zipprick, co-founder and editor-in-chief, says it’s based on long-term growth. The UK’s trajectory broadly over the past 20-30 years, “reveals a remarkable transformation,” he says.

Clare Smyth agrees. “We have seen a tremendous gastronomical growth over the past decade all over the country,” she says. Her London-based restaurant Core by Clare Smyth is one of 28 sharing the No. 5 ranking this year.

Mr. Zipprick says La Liste also uses its data to identify long-term trends. One is a growing disconnect between what fine diners want and what chefs appear to focus on. That complaint has been rattling around for years and data from La Liste is now able to confirm it. In response, La Liste has debuted a Show to Table category, recognizing places that prioritize guest experience. Winners include the Paris cabaret Bœuf sur le Toit from the MOMA Group; and immersive gastro-theater spot Krasota in Dubai.

Yet challenges persist. “The past year has witnessed an unprecedented wave of closures. This transformation is clearly visible in our Top 1000,” Mr. Zipprick says, about restaurants that have dropped off the list, like Tetsuya in Sydney and Pollen Street Social in London, for reasons like soaring rents, COVID-era debts coming due, and the rising costs of ingredients and labor.

The good news: while some icons falter, others are redefining the space in what’s been “the most varied dining scene in history,” according to Mr. Zipprick. The ever-expanding world of gastronomy has led to global destinations like Kazakhstan emerging on the fine-dining map. — Bloomberg

15 other restaurants that are top-ranked in their country

Australia: Vue de Monde

Belgium: Boury

Denmark: Geranium

Italy: Atelier Moessmer Norbert Niederkofler

Mexico: Quintonil

Monaco: Le Louis XV by Alain Ducasse

The Netherlands: De Librije

Peru: Maido

Portugal: Ocean

Singapore: Odette

South Korea (tie): Mingles; and La Yeon

Spain: Martín Berasategui

Sweden: Frantzén

Thailand: Baan Tepa Culinary Space

The Philippines made an appearance on the list: Toto Eatery in Makati entered the Top 1000 with a score of 75.50.

TDF yields slip on BSP, Fed bets

November 28, 2024 | 12:04 am

TERM DEPOSIT yields slipped on Wednesday as the offer went undersubscribed and with markets anticipating further policy easing by both the Bangko Sentral ng Pilipinas (BSP) and US central bank.

The BSP’s term deposit facility (TDF) attracted bids worth P250.598 billion, below the P280 billion on the auction block and P290.223 billion in bids a week ago for a P250-billion offer.

Tenders for the seven-day debt reached P154.953 billion, lower than the P160 billion auctioned off by the central bank. This was also below the P177.147 billion in bids seen for the P140 billion offered last week.

Banks asked for yields of 5.975% to 6.0815%, narrower than the 5.97% to 6.0825% margin a week earlier. This caused the average rate of the one-week deposits to slip by 0.32 basis point (bp) to 6.0584% from 6.0616% previously.

Meanwhile, bids for the 14-day term deposits reached P95.645 billion, also lower than the P120-billion offer and P113.076 billion in tenders a week ago for the P110 billion placed on the auction block.

Accepted rates ranged from 6% to 6.125%, steady from the margin seen a week ago. Still, the average rate for the two-week deposits decreased by 0.18 bp to 6.0902% from 6.092% last week.

Meanwhile, the BSP has not auctioned off 28-day term deposits for more than four years to give way to its weekly offer of securities with the same tenor.

The central bank uses the term deposits and the BSP bills to mop up excess liquidity in the financial system and to better guide market rates.

Term deposit yields declined amid expectations of further policy easing by the Philippine central bank, Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp., said in a Viber message.

BSP Governor Eli M. Remolona, Jr. last week said the Monetary Board could either keep or cut benchmark rates at its Dec. 19 policy meeting.

Inflationary pressures would warrant a pause, while weaker-than-expected growth would pave the way for another rate cut, he said.

Since August, the BSP has delivered a total of 50 bps worth of cuts, bringing the policy rate to 6%.

Markets are also pricing in further reductions from the US Federal Reserve, Mr. Ricafort added.

Consumers’ average inflation expectations over the next 12 months dropped to 4.9%, the lowest since March 2020, from 5.3% in October, Reuters reported.

Nonetheless, high prices remain a concern, with consumers saying lower prices was their top wish for the new year. Frustration over inflation swept Trump to victory over Vice President and Democratic Party candidate Kamala Harris.

There are, however, concerns that the president-elect’s economic policies could stoke inflation, and slow the pace of interest rate cuts next year.

Minutes of the Federal Reserve’s Nov 6-7 policy meeting published on Tuesday showed officials appeared divided over how much farther they may need to cut rates. The US central bank started lowering rates in September, having hiked them in 2022 and 2023 to combat inflation.

Markets currently see a 63% chance of a 25-basis-point rate cut by the Fed in December, as per the CME group’s FedWatch tool.

Mr. Ricafort also cited the decline in global crude oil prices.

Oil prices steadied on Wednesday, with markets assessing the potential impact of a ceasefire deal between Israel and Hezbollah, and ahead of Sunday’s OPEC+ meeting of producers, Reuters reported.

Brent crude futures rose 5 cents to $72.86 a barrel by 0415 GMT, while US West Texas Intermediate crude futures were up 3 cents at $68.80 a barrel. — Luisa Maria Jacinta C. Jocson with Reuters

VAT exemption for all prescription drugs

November 28, 2024 | 12:03 am

Medicine-pills-drugs — ALEXANDER GREY-UNSPLASH

The Food and Drug Administration (FDA) recently updated its list of prescription drugs and essential medicines exempt from value-added tax (VAT), adding 16 new medicines for the treatment of cancer, diabetes, and mental illnesses. The VAT exemption aims to make these medicines more affordable for the general public. However, this piecemeal approach, while commendable, falls short of addressing the broader issue of healthcare affordability.

Seniors and Persons With Disabilities (PWDs) already enjoy VAT exemptions on their prescription medicines, coupled with a 20% discount. This also extends to their vitamins and supplements, if prescribed. Additionally, certain medicines for hypertension, cancer, mental illnesses, tuberculosis, kidney diseases, diabetes, and high cholesterol are now universally exempt from VAT. These measures are steps in the right direction, but they leave significant gaps.

In my opinion, the FDA should abandon its selective exemption process. Instead, Congress should pass legislation to exempt all prescription drugs from VAT. While this may erode tax revenues, it would significantly reduce the financial burden of healthcare on patients, particularly the poor, and lower the public cost of maintaining government inventories of essential medicines.

Healthcare costs are a global concern. Taxing essential medicines exacerbates the financial strain on patients, who may already struggle to afford basic needs. The government should exempt all prescription drugs from all forms of sales tax as a way of ensuring affordability and equity. This universal exemption would prevent inequities in access and demonstrate a strong commitment to public health No one should be forced to choose between buying medicine and meeting other essential needs. Medicine, like food and water, is a basic necessity. Taxing essential medicines is not only regressive but also perpetuates inequality and undermines the principle of universal healthcare. By taxing medicine, we effectively penalize illness — an injustice that disproportionately affects those least able to bear the cost.

Access to medicine is fundamental to the right to healthcare. Universal healthcare demands universal access to affordable medicines. Without VAT exemption for all prescription drugs, we fall short of achieving true universality. The current practice of taxing medicines unfairly punishes those who are sick and amplifies the challenges faced by people with chronic illnesses requiring long-term treatment.

VAT undeniably inflates the cost of medicine. The key question is whether the revenue collected from taxing medicines outweighs the public health benefits of universal VAT exemption. There may be evidence to suggest that it does not. High out-of-pocket costs deter many from seeking timely treatment, leading to poorer health outcomes and higher long-term healthcare expenditures.

Tax exemption should be viewed as an investment in public health rather than a cost. Preventing illness and reducing the need for expensive interventions saves more in the long run than the short-term revenue gained from taxing medicines. Universal exemption would also reduce the administrative burden of maintaining and updating selective exemption lists.

Countries like the United Kingdom and Canada have long recognized the essential nature of medicines by exempting prescription drugs from sales taxes entirely. Australia takes this a step further, combining tax exemptions with subsidies to make medicines even more accessible. These policies have demonstrably improved access and public health outcomes in their respective countries.

In contrast, the United States adopts a mixed approach. While federal laws exempt prescription drugs from taxes, some states still impose sales taxes on medicines. This patchwork system creates disparities in affordability and access. Similarly, India levies a sales tax on medicines, with limited exemptions. However, India’s robust generics industry helps mitigate costs domestically, making medicines more accessible despite the tax burden.

In the Philippines, VAT exemptions apply only to specific medicines. This selective approach creates “unequal relief,” leaving patients with other chronic conditions to bear high out-of-pocket costs. If the government truly aims to achieve universal healthcare, it must move away from piecemeal measures and adopt a comprehensive, universal exemption policy.

Admittedly, transitioning to a blanket VAT exemption for all prescription drugs will require careful consideration of its economic impact. While the government may lose revenue initially, the long-term benefits — including improved public health, reduced hospitalizations, and lower healthcare costs — would far outweigh these losses. Moreover, universal exemptions simplify tax administration, reducing compliance costs and opportunities for fraud.

One concern is the potential fiscal impact. How much VAT revenue does the government collect from medicine sales? This is a question that requires precise data from the Bureau of Internal Revenue (BIR) and the Department of Finance (DoF). A comprehensive cost-benefit analysis would help policy makers weigh the trade-offs and craft a sustainable policy.

The VAT exemption could begin with prescription drugs and expand over time to include other medical essentials, such as diagnostic tools and treatment products. Supplements, while beneficial, can be considered at a later stage. Complementing tax exemptions with subsidies for high-cost medicines would further enhance affordability and access.

Universal VAT exemption for all prescription drugs would be a clear statement of the government’s commitment to social equity and public health. Healthcare savings from reduced medication costs, coupled with the economic benefits of a healthier population, make this policy a win-win for all stakeholders.

As the Philippines continues its transition to universal healthcare, it must address the inequities in its current VAT policy. Universal exemption would bring us closer to the ideal of a healthcare system where no one is left behind due to financial barriers. A selective tax exemption for life-saving medicine is contrary to this ideal.

Marvin Tort is a former managing editor of BusinessWorld, and a former chairman of the Philippine Press Council.

matort@yahoo.com

Innovation dev’t credit quota may cause banks’ bad loans to increase

November 28, 2024 | 12:03 am

By Luisa Maria Jacinta C. Jocson, Reporter

THE MANDATED lending quota for innovation development on banks may lead to a surge in nonperforming loans (NPLs) and to banks opting to incur penalties than meet the requirement, analysts said.

“I’m more concerned about the implications on NPLs, which has been trending higher in recent months. Micro, small, and medium enterprises (MSMEs), especially start-ups, have a certain risk profile that might lead to higher NPLs for the banks,” AP Securities, Inc. Research Head Alfred Benjamin R. Garcia said.

Under the Philippine Innovation Act, all public and private banks are required to set aside at least 4% of their total loanable funds for innovation development credit.

The Bangko Sentral ng Pilipinas (BSP) recently released draft implementing rules for the law.

Based on the BSP’s draft rules, borrowers eligible for innovation development credit include “MSMEs, startups, innovation centers, business incubators and other entities that facilitate and support the development of new technologies, product innovation, process innovation, organizational innovation, and marketing innovation.”

Mr. Garcia noted the risk of higher NPLs if banks ramp up lending to small businesses.

Latest data from the BSP showed that the banking industry’s gross NPL ratio slipped to 3.47% in September from the over two-year high of 3.59% in August. However, it was still higher than 3.4% in the same period in 2023.

Bienvenido S. Oplas, Jr., president of a research consultancy and of the Minimal Government Thinkers think tank, said these kinds of mandates are the “bane of innovation and finance liberalization itself.”

“Take the mandatory 25% of banks loanable amount to be allocated for agriculture via the Agri-Agra law. Banks would rather pay the penalty for not reaching that mandatory 25%,” he said in a Viber message.

Separate BSP data showed that loans extended by Philippine banks to MSMEs reached P488.13 billion as of end-June. This accounted for only 4.52% of their total loan portfolio of P10.8 trillion, well-below the required 10% quota.

Under the Magna Carta for MSMEs, banks must allot 10% of their loan portfolio for small businesses. Broken down, 8% must go to micro and small enterprises while the remaining 2% goes to medium-sized businesses.

However, banks have long opted to incur penalties for noncompliance instead of taking on the risks associated with lending to small businesses.

“This mandatory 4% of loanable amount for innovation is another bane. Some banks can easily fill that while others won’t be able to, so they will be fined by the BSP,” Mr. Oplas said.

He warned against similar mandates and overly regulating banks.

“The government does not need legislation to mandate that people should eat, should sleep, should take vacation. People do it on their own without government mandate because it’s the right thing to do for themselves,” he said.

“So, I do not think this law will achieve its goal without creating economic and (financial) distortion somewhere. The BSP can only minimize the distortions by liberalizing as many sectors as possible to be qualified as ‘innovation’ loans,” he added.

On the other hand, Mr. Garcia said although the 4% quota may be considered small, this is equivalent to more than P700 million.

He also said banks would likely be able to meet the lending quota.

“However, it’s a good thing that the definition of funding provided for innovation development is quite broad and includes investments in equities of startups so it shouldn’t be a problem for banks to meet the quota.”

Under the draft rules, the BSP identified the modes of compliance with the mandatory credit requirement, namely direct and alternative compliance.

Direct compliance covers loans granted to qualified borrowers after Aug. 6, 2019 for innovation development.

Meanwhile, the allowable alternative compliance include investments in bonds issued by the Development Bank of the Philippines and Land Bank of the Philippines with proceeds used exclusively for on-lending for innovation development, as well as in debt securities with proceeds going to innovation development, and loans to or investments in financial entities, excluding banks, that provide supply chain financing for MSMEs that promote innovation.

Investments in the equities of startups can also be counted as compliance with the credit quota, among others.

The draft rules also detail penalties for noncompliance or under compliance with the credit quota.

These penalties shall be computed at one half of 1% (0.5%) of the amount of noncompliance or under compliance and will be directed towards innovation development.

Megawide Construction Corp. announces Special Stockholders’ Meeting on Dec. 10 via remote communication

November 28, 2024 | 12:03 am

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CSB, Game Developer Association sign MoU to upskill students

November 28, 2024 | 12:03 am

THE Game Developer Association of the Philippines (GDAP) and the De La Salle-College of Saint Benilde (DLS-CSB) recently signed a memorandum of understanding (MoU) to provide workshops and seminars for students looking to enter the gaming industry.

“This shared venture seeks to advocate for student internships, along with exposure and immersion trips for the faculty and associates,” GDAP said in a statement.

The partnership is also looking to endorse the micro-credentialing of Benilde courses are relevant to GDAP and the industry.

GDAP serves as the country’s premier digital game development trade association. It aims to support growth in the digital gaming industry by spreading awareness and engaging in academic linkages.

“With GDAP’s expertise in the field, the cooperation intends to provide cooperative workshops, seminars, and conferences for the Benildean community as well as the public,” it said.

GDAP President James Ronald Lo said this is the group’s first MoU with a school, which is expected to help in increasing digital gaming professionals in the country.

The partnership between GDAP and DLS-CSB is about building the future of game development in the Philippines, said DLS-CSB Chancellor Benhur A. Ong.

“We incorporated on a business journey to create the very first full game development education curriculum in the country,” Mr. Ong was quoted as saying.

The school’s game design and development program took 15 years to be finalized, Mr. Ong said.

In 2009, DLS-CSB first introduced gaming design as a program with its Bachelor of Science in Information Technology degree with specialization in Game Design and Development.

The revamped program, the Bachelor of Science in Interactive Entertainment and Multimedia Computing, was launched in 2015.

“We’re not only equipping our students with the skills they need. It’s also about helping them engage with real-world challenges,” Mr. Ong said.

“We hope that the aim is clear — to bring academia into the industry so that our students can be game changers.”

DLS-CSB ROLLS OUT ONLINE ENTRANCE EXAM
Meanwhile, DLS-CSB also announced the implementation of a fully online entrance examination with computer-aided proctoring.

The revamped Benilde Entrance Examination (BEE) aims to offer a flexible and accessible exam option, the school said. The online BEE will be rolled out for the application period for academic year 2025 to 2026.

“To ensure academic integrity and fair assessment, the system translates the traditional paper-and-pencil exam into a timed computerized test format that utilizes advanced technology for delivery and security. It likewise adopts facial and voice recognition technology to evaluate the environment, movement, and behavior of the candidates,” it said in a separate statement.

“Through this new modality, applicants may accomplish the exam remotely provided that they have a laptop or desktop and a stable internet connection. The technical requirements likewise include a webcam, external microphone or headset, and a mobile phone to be used as a secondary camera.”

Applicants will receive exam schedule confirmation and instructions via e-mail and will have to complete a pre-test check prior to the exam.

“For those who need specific assistance or accommodation, the college will offer in-campus examinations to be held at the designated computer laboratory on identified schedules,” DLS-CSB said. “Students are expected to accomplish the BEE without aids and tools, apart from plain bond paper and pencil during the Mathematics Exam.”

Both the online and on-site exams will still be monitored by a human proctor, it added. — Beatriz Marie D. Cruz

SMIC says logistics, RE to drive future expansion

November 28, 2024 | 12:03 am

THE LOGISTICS and renewable energy (RE) sectors will be key drivers for SM Investments Corp.’s (SMIC) future expansion, a company official said.

“The areas of logistics and renewable energy alone have a lot of potential,” SMIC Executive Vice-President for Treasury, Finance, and Planning Erwin G. Pato told reporters on the sidelines of the BusinessWorld Forecast 2025 forum on Tuesday.

“How we look at the investments is that we want to be good at it first before we continue expanding to others. We are at that stage where we understand the logistics business much better, and that is why we continue to invest in that business. It is the same with renewable energy. That’s why, as we understand steam production better, we engage with more concession sites,” he added.

SMIC operates in the logistics sector through 2GO Group, Inc. and in the renewable energy sector through Philippine Geothermal Production Co., Inc. (PGPC).

In June last year, PGPC announced plans to build five new geothermal projects in Luzon.

“Our aim is to essentially increase our steam output supply,” Mr. Pato said.

Mr. Pato said SMIC is open to other renewable energy technologies such as solar and wind projects.

“Clean energy is a space that we’re looking at and has a lot of potential,” he said.

He also said that SMIC’s capital expenditure (capex) budget for 2025 could match this year’s.

The conglomerate announced in April that it had allocated up to P115 billion in capex for this year.

“We have to look at it because with lower interest rates and easing funding, as the Bangko Sentral ng Pilipinas (BSP) has decreased the reserve requirements, there can be opportunities to expand. It will be around the same as we have this year,” he said.

The BSP previously reduced the reserve requirement ratio for big banks and nonbank financial institutions with quasi-banking functions by 250 basis points (bps) to 7% from 9.5%.

It also reduced the ratio for digital banks by 200 bps to 4%; thrift banks by 100 bps to 1%; and rural banks and cooperative banks by 100 bps to 0%.

“How we decide on funding is we ask ourselves which one is more efficient,” Mr. Pato said.

Meanwhile, 2GO Group, Inc. is expected to see growth in its passenger volume next year.

“2GO is already in expansion mode. As we grow our routes in Iloilo, Bacolod, Cagayan de Oro and Manila, it unlocks transfer of goods and services,” Mr. Pato told BusinessWorld.

“But more importantly, as you connect the tourist areas and industrial areas, then it will spur more economic activity, and as that happens 2GO would also be better in terms of financials.”

For now, he said the company will not be exploring new routes as it intends to further grow its services in its current operations.

“There is still a lot of potential within those routes. It is not fully served yet. We are happy with the results right now, but we will look and see how we can essentially grow within those routes,” he said.

In May, 2GO launched its newest roll-on, roll-off vessel — the MV Masigla sailing to Iloilo, Bacolod, and Cagayan.

For 2024, the company had announced it would allocate up to P2 billion for capex, focusing on new containers, material handling equipment, and service enhancements.

Mr. Pato said that for next year, 2GO’s capital expenditure budget will likely be around the same level.

2GO offers multimodal transportation, warehousing and inventory management, distribution, special containers, project logistics, and e-commerce logistics. It also provides sea travel, freight forwarding, import and export processing, and customs brokerage services.

On Wednesday, SMIC stocks fell by 2.44% or P22 to P879 apiece. — Revin Mikhael D. Ochave and Ashley Erika O. Jose

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