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PHL plans rice imports amid lockdown

By Revin Mikhael D. Ochave

THE government is planning to import 300,000 metric tons (MT) of rice to ensure there is enough domestic supply as Luzon remains under enhanced community quarantine.

At the same time, the country is facing a garlic shortage as local production is not enough to offset the loss of imports from China due to the coronavirus disease 2019 (COVID-19) pandemic, the Agriculture department said.

Cabinet Secretary Karlo B. Nograles on Tuesday said the Inter-Agency Task Force for the Management of Emerging Infectious Diseases (IATF) recommended the importation of rice via government-to-government arrangements.

“The Department of Agriculture (DA) and other government agencies are coordinating with other Southeast Asian countries to make sure that their commitments for rice imports will be uninterrupted,” Mr. Nograles said in a briefing.

The Philippines was the world’s biggest rice importer in 2019, after purchasing a record 2.9 million MT — mostly from Vietnam and Thailand. This after the country removed caps on rice imports, allowing the private sector to purchase unlimited volumes.

However, Vietnam temporarily suspended new rice export contracts, as part of efforts to ensure food security amid the pandemic. Reuters reported that rice traders expect Vietnam to lift the suspension this week, with the government imposing a quota.

Samahang Industriya ng Agrikultura (SINAG) Chairman Rosendo O. So said that instead of boosting rice imports, the government should provide funding for better farming and post-harvest facilities, free farm inputs, and higher support price for palay.

“I think we are the only country who believes in the ‘unli-import’ mindset. The response of our economic managers to Vietnam’s export ban is regrettably, but expectedly, to import an additional 300,000 MT of imported rice,” Mr. So said in a mobile phone message.

Agriculture Secretary William D. Dar earlier said there is enough rice supply which can last up to four months. He said that rice supply for the whole country is at 2.661 million MT, equivalent to a 75-day supply, including stocks from commercial traders, households, and government agencies.

Moreover, National Food Authority (NFA) Administrator Judy Carol L. Dansal said the agency’s current rice inventory is at 481,800 MT, equivalent to a 14-day supply for the entire country. NFA also bought 86,711 MT of palay from individual farmers, cooperatives, and associations during January and February.

Latest data from DA showed that weekly rice demand for Metro Manila is at 26,241 MT with a committed supply of 929,358 MT, enough for a 35-week supply.

GARLIC SHORTAGE LOOMS
Meanwhile, Mr. Dar said in a radio interview on Tuesday that there is currently a huge shortage of garlic in the country.

“Around 8% of garlic requirement is produced locally. Most of our garlic supply comes from other countries like India and China,” he said, noting that they are unable to import garlic from China because of COVID-19.

Mr. Dar said there is no choice but to increase local garlic production. Data from the Philippine Statistics Authority (PSA) showed local production of garlic in 2019 fell 4% to 7,300 MT, compared to 7,600 MT in 2018.

For the 2018-2019 cropping season, imported garlic reached 71,048 MT, data from the DA showed. Local demand for garlic is said to be around 128,000 MT per year.

However, the production of local garlic remains low because it is smaller but also more expensive than Chinese imports.

“China supplies garlic to countries such as Malaysia, Thailand, and Philippines. China garlic is cheap compared to local garlic which is small, low solid content, and expensive,” Rolando T. Dy, executive director of Center for Food and Agri-Business of the University of Asia and the Pacific (UA&P), said in a mobile phone message.

In a text message, DA Assistant Secretary Noel O. Reyes said that department is still in the process of asking farmer groups regarding the situation. — with Reuters

Virus to cut Philippine growth — World Bank

THE Philippine economy is seen growing at a slower pace this year due to the fallout from the coronavirus disease 2019 (COVID-19) outbreak, and may even contract by as much as 0.5% if the Luzon-wide enhanced community quarantine will be extended, the World Bank said in a new report.

The World Bank gave a 3% forecast for the country’s gross domestic product (GDP) growth this year, down from the 6.1% projection it gave in January, according to its Regional Economic Update report for April titled “East Asia and Pacific in the Time of COVID-19” published Tuesday.

Meanwhile, growth is seen picking up to 6.2% next year, maintained from the January projection, and will accelerate to 6.4% in 2022, higher than the previous 6.2% forecast.

These projections reflect the multilateral lender’s baseline scenario. In its lower case forecasts, the World Bank sees the economy contracting by 0.5% this year but recovering to a 4.1% growth next year.

These projections compare to the government’s goal to notch 6.5-7.5% GDP growth for 2020-2022.

Despite the 2020 forecast downgrade, the Philippine economy is still seen to be the third-fastest growing economy this year along with Myanmar’s 3% and is only behind Lao PDR’s 3.6% and Vietnam’s 4.9% and faster than 1.3% regional average expected for the whole developing East Asia and Pacific excluding China, based on the baseline scenario. The region is expected to contract by 2.8% this year in the lower case scenario.

“Real GDP growth is projected to significantly decelerate from 5.9% in 2019 to 3.0% in 2020 due to the impact of the COVID-19 outbreak and the associated community quarantine,” the report read.

“Nevertheless, economic growth is expected to accelerate rapidly in 2021-22 as global conditions improve, and with more robust domestic activity bolstered by the public investment momentum and a boost from 2022 election-related spending.”

Due to the month-long Luzon lockdown, the World Bank expects a sharp decline in domestic consumption in the first semester, which could be further dampened by the slower inflow of remittances, delayed implementation of the government’s infrastructure program, postponed investments from the private sector, as well as a negative impact on exports due to travel restrictions and disruptions in global supply chains.

The World Bank said its baseline forecast of three percent GDP growth this year assumes that economic activity in the country will resume in the third quarter. Risks to this forecast, which could result in a contraction of as much as 0.5% in its lower case scenario, are “a rapid surge in confirmed cases resulting in a prolonged community quarantine, lengthier disruptions to government and business activities, loss of incomes, and a protracted weakening of the public health system.”

“In this case, economic growth could contract in 2020 driven by a drastic slowdown in domestic consumption and investment, with echo effects into 2021. External risks could derive from a prolonged containment of the virus globally, leading to a global recession which will impact the Philippines through manufacturing, trade, tourism, and remittance channels,” the World Bank said.

It said this will likely significantly affect those working in the informal sector.

RECESSION
Meanwhile, Socioeconomic Planning Secretary Ernesto M. Pernia said yesterday the economy might contract in the last two quarters of the year, which will already be considered a recession, if the enhanced community quarantine will be extended.

“[Possibly,] zero growth rate or slightly negative [in the] third quarter, something similar, depending on if the enhanced community quarantine will be extended… [This] is still a speculation. We hope that it’s not negative,” Mr. Pernia said in an ABS-CBN News Channel interview yesterday when asked on his projections for third and fourth quarter GDP growth.

The National Economic and Development Authority earlier said it sees GDP growth of between -0.6% and 4.3% this year due to the virus outbreak.

The World Bank said besides “immediate public health response to prevent, detect, and contain local transmission” of COVID-19, the government needs to implement fiscal and monetary stimuli to cushion the economy against the negative impact of the virus and protect the vulnerable population.

“Specifically, the timely execution of public investments, targeted financial support to the poor and vulnerable sectors can restore confidence and soften the negative impact of the outbreak,” it said.

The World Bank said the country should also strengthen its health care system to prepare for future shocks similar to COVID-19 aside from accelerating structural reforms to improve the business environment and competition in the country and boosting productivity growth.

“Sustained support must be ensured for bills that improve competitiveness, such as the passage of the Corporate Income Tax and Incentives Rationalization Act, and amendments to the Public Services Act,” it added.

Despite expectations of slower growth, the World Bank still sees the country’s poverty incidence continuing to decline to 20.5% this year and to 18.3% in 2022, from 21.9% in 2018.

The World Bank also sees inflation settling at two percent this year, the current account to record a deficit of 0.3% of GDP and net foreign direct investments to decline to 0.5% this year of GDP.

The country’s budget gap is likewise expected to balloon to 3.9% of GDP from 3.5% in 2019, while outstanding debt is seen reaching 36.9% of GDP from 35.7% last year, due to increased spending and borrowings amid the COVID-19 crisis. — BML

Inflation likely slowed in March as oil price plunges

THE overall rise in prices of widely used goods likely slowed in March, the central bank said on Tuesday, as oil prices plunged and food prices remained stable due to a price freeze amid the coronavirus disease 2019 (COVID-19) outbreak.

In a statement on Tuesday, the Bangko Sentral ng Pilipinas (BSP) Department of Economic Research said inflation could settle between 2% to 2.8% in March. The range is closer to the low-end of the 2-4% target by the BSP for 2020 and 2021.

Inflation stood at 2.6% in February, slower than the 2.9% in January and the 3.8% print in February 2019.

“The sharp decline in the prices of petroleum products due to the significant fall in global crude oil prices contributed to the downward price pressures for the month,” the central bank said.

Oil prices plunged in early March when Saudi Arabia, the world’s biggest oil exporter, lowered its selling price to compete against Russia, its closest competitor, despite falling market demand due to the COVID-19 outbreak.

The Monetary Board last month downgraded its average inflation outlook for 2020 to 2.2% from the 3% previously penciled in. It also revised its 2021 average inflation forecast to 2.4% from the previous 2.9%.

“The BSP forecasts tamer inflation this year and next… The main driver for the downward adjustment is the collapse of world crude oil prices. Dubai crude oil price is now at its 18-year low of $22.51 per barrel from its recent peak of $85 per barrel in 2018,” BSP Governor Benjamin E. Diokno told reporters in a Viber message on Tuesday.

The central bank said slower inflation in March will also be supported by stable food prices as the government imposed a price freeze on basic necessities from March 16 to May 15.

“The prices of selected food products remained broadly stable in March due to adequate supply and favorable weather conditions along with the price freeze imposed on basic necessities by the Department of Trade and Industry and the Department of Agriculture,” the BSP said.

At the same time, the BSP flagged a slight uptick in electricity rates for those areas served by Manila Electric Co. (Meralco).

The distribution utility raised overall electricity rates for the month to P10.4961 per kilowatt-hour (/kWh), up by P0.0894/kWh from the previous month.

Amid the enhanced community quarantine in Luzon, Meralco announced it will temporarily suspend physical meter reading and bill delivery. It said the monthly bill will be based on customers’ average electric usage for the past three months as per the advice of the Energy Regulatory Commission.

The Philippine Statistics Authority will report March inflation data on April 7. — Luz Wendy T. Noble

PHL airlines seek gov’t help to survive virus

By Arjay L. Balinbin
Reporter

LOCAL AIRLINES are appealing for government help, as the “catastrophic impact” of the coronavirus disease 2019 (COVID-19) pandemic threatens their survival.

“The Philippine carriers are facing an existential threat to their survival which is faced by other airlines in the region and in other parts of the world,” the Air Carriers Association of the Philippines (ACAP) said in a March 25 letter addressed to the heads of the Departments of Transportation, Finance, Tourism and Trade, and the National Economic and Development Authority.

The group, composed of Philippine Airlines, Inc. (PAL), Cebu Air, Inc. (Cebu Pacific), Philippines AirAsia, Inc., Air Philippines Corp. (PAL Express), and Cebgo, Inc., emphasized that they are not seeking a “handout” at the expense of the taxpayers but only want to have ready working capital to allow them to restart and continue operations.

“Given these extraordinary times where the survival of the domestic airline industry is at stake, ACAP member airlines urgently appeal… for timely government intervention which is indispensable if Philippine aviation will have the capacity to resume its vital role of connecting people for trade, commerce and tourism,” ACAP said.

ACAP said its member-airlines temporarily shut down passenger operations until April 14 after Luzon was placed under enhanced community quarantine (ECQ). Over 30,000 flights were canceled, affecting nearly five million passengers.

Airlines are now unable to generate revenues in the next few weeks or even months, while banks have tightened credit lines.

ACAP asked the government to provide a credit guarantee scheme “that guarantees the banking sector’s loans and credit lines, most of which are secured with collateral, to remove its aversion to the poor credit risk of the airline industry under the present operating environment.”

The group also requested the government to give them access to emergency lines of credit to fund six months of operations of airlines and other aviation-related companies, “in order for the industry to remain viable until overall demand recovers.”

“We request that upon the lifting of the ECQ hopefully by April 14, uniformity in aviation transport regulations would be implemented in the entire country, and that LGUs be mandated to align with National Government,” it added.

To ensure airlines successfully recover, ACAP said they need a “long-term facility with attractive rates or a guaranty facility to allow them to restructure their debt at manageable levels, and secure better terms from aircraft lessors, bankers and creditors.

Lastly, the local airlines sought a full waiver of all navigational and airport charges, which include airport office rentals and land leases, until the end of 2020.

“ACAP member-airlines assure the government that these financing will be used for legitimate business stabilizaton purposes with the corresponding corporate governance in place,” the local airlines group said.

Sought for comment, Finance Secretary Carlos G. Dominguez III told BusinessWorld in a mobile phone message that they “will ask the BSP (Bangko Sentral ng Pilipinas) to support the banks that support their clients, including airlines.”

Transportation Assistant Secretary Goddes Hope O. Libiran, speaking for Transportation Secretary Arthur P. Tugade, said in a mobile phone message that ACAP’s request will be discussed during a meeting of the Inter-Agency Task Force (IATF) for the Management of Emerging Infectious Diseases.

The International Air Transport Association (IATA) last week said without government support, up to 50% of global airlines face possible bankruptcy in the coming weeks. IATA estimated revenue losses from the COVID-19 crisis to reach over $250 billion this year.

Earlier, the Australia-based Center for Asia Pacific Aviation (CAPA) has said airlines in Asia-Pacific countries, including the Philippines, will be the most badly affected by the COVID-19 pandemic.

AboitizPower seeks nod on P9.6-B bonds

ABOITIZ POWER CORP. (AboitizPower) is seeking the approval of the Securities and Exchange Commission for the issuance of the fourth tranche of its P30-billion fixed-rate retail bonds registered in 2017 under the shelf registration program of the corporate regulator.

The energy firm told the stock exchange on Tuesday that it has filed for an application to issue the P9.55-billion bonds, which it expects to roll out by the second or third quarter of the year, in one or two series.

AboitizPower, the energy arm of Aboitiz Equity Ventures, Inc., plans to use the proceeds from the bond offering, set to be listed with Philippine Dealing and Exchange Corp., to reimburse equity infusions and fund succeeding infusions into AA Thermal, Inc.

AA Thermal was the thermal platform of Ayala-led AC Energy, Inc. in the Philippines which shares the Aboitiz power unit acquired in 2019. It has a 49% voting stake and a 60% economic interest in the company.

Further, it also eyes to invest in Therma Power, Inc. for the construction of two units of 668-megawatt super critical coal-fired power plant of GNPower Dinginin Ltd. Co., which AA Thermal also has an interest in.

AboitizPower engaged BDO Capital & Investment Corp. and First Metro Investment Corp. as joint issue managers, as well as joint lead underwriters, along with China Bank Capital Corp. It also tapped the BDO Unibank, Inc. Trust & Investments Group as its trustee.

The company issued the first tranche of the retail bonds worth P3 billion on July 3, 2017. The second tranche was out on Oct. 25, 2018, amounting to P10.2 billion, and the third, which is worth P7.25 billion, on Oct. 14, 2019.

On Tuesday, shares in AboitizPower grew by 9.36% to close at P26.30 apiece. — Adam J. Ang

MPIC takes Japanese partners in Indonesia infrastructure firm

METRO PACIFIC Tollways Corp., (MPTC) the tollways unit of Metro Pacific Investments Corp. (MPIC), has sold a 10.32% stake in Indonesian infrastructure firm PT Margautama Nusantara (MUN) to a consortium of Japanese firms, the Metro Pacific group said on Tuesday.

In a disclosure to the stock exchange, MPIC said its tollways unit MPTC, through its wholly-owned subsidiary CIIF Infrastructure Holdings Sdn. Bhd. (CIIF), has entered into a share purchase agreement with Japan’s West Nippon Expressway (NEXCO-West), Japan Expressway International Co., Ltd., (EXWAY), and Japan Overseas Infrastructure Investment Corp. for Transport & Urban Development (JOIN).

The Japanese group acquired the 10.32% stake, valued at about $35 million, in MUN.

MPTC continues to hold majority shares in MUN through PT Nusantara Infrastructure Tbk, which the Philippine toll road operator controls through its wholly-owned Indonesian subsidiary PT Metro Pacific Tollways Indonesia (PT MPTI).

MPTC said it believes having the Japanese firms in MUN as “strategic partners will significantly contribute to the growth” of the Indonesian toll road operator.

“Their knowledge and capability in toll roads will be instrumental in identifying operational efficiencies and improvements. Each of JEXWAY and NEXCO-West are well-known for their extensive experience and expertise in operating and maintaining toll roads, while JOIN is the first and only government-private fund in Japan that specializes in overseas infrastructure investment,” it said.

MPTC took full control of MUN in September last year as it sought to further expand its toll road business outside the Philippines.

MPTC, through its Singaporean subsidiary Metro Pacific Tollways Asia Corp. Pte. Ltd. (MPT Asia), bought 100% equity interest in CIIF and CAIF III Infrastructure Holdings Sdn Bhd (CAIF III) in MUN. The transaction gave MPTC 100% total equity interest in MUN, as the remaining 74.98% of the company is owned by PT Nusantara Infrastructure Tbk.

MPIC is one of the three key Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc.

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. — Arjay L. Balinbin

PCC clears Synergy acquisition of entities owning NGCP

THE PHILIPPINE Competition Commission (PCC) has approved the Synergy Grid & Development Phils. Inc. acquisitions of shares in electricity holding companies OneTaipan Holdings, Inc. (OneTaipan) and Pacifica21 Holdings, Inc. (Pacifica21).

The transaction for 67% of the outstanding shares of each of the holding companies will lead to Synergy’s direct control of both holding companies as subsidiaries.

The antitrust regulator said in a statement on Tuesday that the transaction is unlikely to create a substantial decrease in competition, noting that it will not likely lead to a significant change in the structure of the electricity transmission market.

PCC said the transaction will not lead to substantial change in the control, operations, and management of the National Grid Corporation of the Philippines (NGCP), the operator of the national electrical grid.

OneTaipan owns controlling shares in Monte Oro Grid Resources Corp., which holds 30% plus one share in NGCP. Henry Sy Jr. is the director and controlling shareholder of OneTaipan, as well as the chairman of the board and president of Synergy, holding 44.5% of outstanding capital stock.

Pacifica21 owns controlling shares in Calaca High Power Corp., which owns 30% minus one share in NGCP. Roberto Coyuito Jr., is director and controlling shareholder of Pacifica21 and is also a director of Synergy, owning 34% of outstanding capital stock.

“The Commission notes the finding of the Mergers and Acquisitions Office that the corresponding equity acquisition by Mr. Henry Sy, Jr. and Mr. Roberto Coyuito Jr. in Synergy does not meet the size of transaction threshold provided under the antitrust law’s regulations, and does not appear to result in a change in control of Synergy,” PCC said.

Synergy in the transaction acquires the total issued and outstanding capital of OneTaipan and Pacifica21 in exchange for Synergy’s additional issuance of stock from an increase in its total authorized capital stock to P5.050 billion from P50 million.

The increased authorized capital stock will be divided into 5 billion common shares at a par value of P1 per share.

“Out of such increase in its authorized capital stock, 4,100,400,000 common shares of Synergy will be issued in exchange for 67% outstanding shares of each of the two holding companies,” PCC said. — Jenina P. Ibañez

Meralco says electricity supply steady during Luzon lockdown

MANILA ELECTRIC CO. (Meralco) said it is working around the clock to ensure a steady supply of electricity and services amid the Luzon-wide enhanced community quarantine.

“During these challenging times, Meralco remains always ready and will continue working with the energy sector so as to ensure that electric power services remain uninterrupted,” Ronnie L. Aperocho, Meralco senior vice-president and head of networks, said in a statement on Tuesday.

“Our company continues to keep up the good fight and sustain our mission to keep the lights on for each and every single customer in our franchise area,” Meralco President and Chief Executive Officer Ray C. Espinosa added.

The distribution utility noted minimal power interruptions within its franchise areas, following the suspension of its scheduled maintenance activities from March 15 to April 14 except for activities in critically loaded areas.

Meralco said that its entire distribution network remains visible all day because of the triple-redundancy of its control center.

“This flexibility affords us to spread deployment of personnel critical to our business operations, not only to assure their well-being, but more importantly, to ensure that power across our franchise is uninterrupted during these critical times,” Mr. Aperocho said.

Lately, Meralco powered Quezon City’s coronavirus disease 2019 (COVID-19) regional evacuation center, as well as approved the service application of Urban Homes, which provided free lodging for health workers at St. Luke’s Medical Center in Taguig City.

Meralco has also suspended its meter reading and bills delivery to customers. It said that the monthly bill of customers whose meters are scheduled to be read between March 17 to April 14 will be based on their average electricity usage for the past three months.

On Tuesday, shares in Meralco went up 4.94% to close at P225.00 each.

Meralco’s controlling stakeholder, Beacon Electric Asset Holdings, Inc., is partly owned by PLDT Inc. Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has interest in BusinessWorld through the Philippine Star Group, which it controls. — Adam J. Ang

Uplifting the arts in challenging times

By Michelle Anne P. Soliman, Reporter

Cinemas, theaters, concert halls, and museums have all closed their doors since Luzon was placed on enhanced community quarantine due to the COVID-19 pandemic two weeks ago. Show openings, gigs, workshops, regional art festivals and conferences have either been postponed or canceled.

Since the government directive has restricted public movement to essential activities such as buying food, medicine, and bank transactions, it has also led to an indefinite loss of livelihood and income for people working in most industries, including the arts and culture sector.

THE INITIATIVE
A team of artists — made up of JK Anicoche, Laura Cabochan, Jopie Sanchez, and members of Komunidad, Sipat Lawin, and the Concerned Artists of the Philippines — realized the urgency of helping art freelancers, performers, artistic coaches and educators, and cultural workers. The team launched the #CreativeAidPH initiative, in collaboration with Nayong Filipino Foundation Inc. (NFPI).

“[The initiative] rose from the urgency of the situation, but at the same time foreseeing possible ways on sustainability,” Mr. Anicoche told BusinessWorld in a Facebook Messenger video call.

“Summer is coming. And summertime is the time when nakakabawi ang mga artists (when artists can make up for things) because it’s the workshop season, and events season. Then suddenly, the March to April [events] biglang nawala (suddenly vanished),” Mr. Anicoche said. “When we talk about arts, it’s not just about performers. It’s also about the technicians, teachers, [and] scholars behind it.”

The initiative’s first step was to gather data through a “Survey for Cultural Workers” online to map out losses and specific needs of cultural workers and creatives. The survey, which ran from March 17 and closed on March 23, gathered 499 responses.

#CreativeAidPH team member Laura Cabochan noted that respondents reported a loss of income and loss of livelihood. She cited that the former refers to cancelation of payments for canceled projects, while the latter refers to downtime from work or projects.

One respondent (respondents’ names and profiles have been withheld as data analysis is ongoing) noted that the quarantine affected their show dates. “I have technically finished my work but I don’t think I will get paid in full because the work will not be staged.” The respondent added that teaching and attending classes, and accepting gigs have stopped in the meantime.

Another respondent wrote that as a freelance artist, their income depends on art-related events.

“The situation that the country is dealing with right now [hampers] my activities to earn money. I can only think of opening digital commission artworks as an alternative way to earn possible income in the meantime, but to be honest it is really not enough to compensate for my usual earnings from events,” the freelance artist wrote.

Some artists have found an alternative through accepting commission works or hosting live performances and workshops online while in their homes.

Respondents have also noted that they are seeking health benefits and financial support from the government in order to support themselves and their families.

PLAN OF ACTION
The team noted that the gathered data will help them provide information for partner institutions in crafting specific programs.

“Once we have a complete report, we intend to submit it to the Arts and Culture Committee of the League of Corporate Foundations. Aside from that, we hope to send it to other arts organizations,” Ms. Cabochan wrote in subsequent correspondence via Facebook Messenger.

She added that in the works is the creation of a Facebook page that will serve as a venue for creatives to communicate and share relevant information and resources.

While the team behind #CreativeAidPH and the NFPI are currently analyzing the data, the National Committee on Cinema of the National Commission for Culture and the Arts (NCCA) has submitted a position paper for a disaster fund mechanism to aid the arts and culture industry. Endorsed by Subcommission on the Arts Head Roland B. Tolentino, the position paper is currently with the NCCA Board of Commissioners for feedback.

Ramon Alberto Garilao, secretary of the National Committee on Cinema, told BusinessWorld via Facebook Messenger that the committee “has been discussing ways to help alleviate the plight of our artists and cultural workers” since the implementation of the enhanced community quarantine.

“Our job is to identify the needs of our sectors and create proposals/recommendations to help address their concerns. Today, as we all combat the COVID-19 pandemic, we see the urgent need of the cultural and creative industry for assistance (in all forms: financial, platforms to continue creating art, promotions, publicity, etc.),” Mr. Garilao wrote.

The position paper presented local and international data, including appeals posted on social media by Mr. Anicoche and the Artists Welfare Project, Inc. (AWPI) to support and illustrate the urgency.

The letter’s recommendations of priorities include: a realignment of budget and creation of subsidy programs for those affected by the crisis; extending deadlines of grantees; spearhead initiatives to uplift the cultural and creative sector; and establishing a trust fund to ensure financial security.

“I believe this sporadic action from all involved parties (individuals, groups, etc.) is a good indication that our artists and cultural workers are becoming an active part of government policy-making,” Mr. Garilao wrote.

As of March 29, Mr. Tolentino wrote in an e-mail to BusinessWorld that “there is [as] yet [no] feedback received from the NCCA Board [of Commissioners].”

GT Capital net income up 54%

EARNINGS of GT Capital Holdings, Inc. (GT Capital) surged 54% to P20.31 billion in 2019, driven mostly by gains from the redemption of its shares in real estate subsidiary Property Company of Friends, Inc. (PCFI).

In a presentation to stockholders on its website, the Ty-led conglomerate said its growth last year was supported by double-digit expansions across its business units.

GT Capital saw a P3.58 billion total income from the redemption of its investment in PCFI. Minus this and the P1.28 billion share in the non-recurring gain of its stake in Metro Pacific Investments Corp. (MPIC), and adding the P330 million amortization of fair value adjustments, GT Capital’s core net income last year is 22% higher at P15.78 billion.

The company’s total revenues grew 8% to P222.9 billion, largely driven by its banking and automotive segments.

By business units, banking unit Metropolitan Bank & Trust Co. (Metrobank) added the biggest chunk to the pie with a net income contribution of P28.06 billion, up 28% from a year ago.

In a regulatory filing, GT Capital attributed the growth of Metrobank to the expansion of net interest margin to 3.84%, strong trading and forex gains, and a 6.7% growth in loans and receivables.

Automotive unit Toyota Motor Philippines Corp. (TMP) booked the second biggest net income contribution at P9.08 billion, higher by 15% from a year ago. The increase was traced to a 6% revenue growth to P168.62 billion, primarily due to larger sales volume, price increases and higher export and spare parts profit.

The company’s stake in MPIC generated P23.86 billion in net income contribution, a 69% jump from the previous year. This is due to revenue increases in MPIC’s energy, toll roads and hospital businesses.

Property unit Federal Land, Inc. (FLI) booked a net income of P1.61 billion, 56% up from a year ago. This is largely due to “higher revenues arising from faster percentage-of-completion coupled with lower cost adjustments.”

Life and non-life insurance unit Philippine AXA Life Insurance Corp. recorded a net income growth of 23% to P2.37 billion, which it said was due to the improvement in premium margins, increase in asset management fees and higher investment income.

For 2020, GT Capital is allocating P28.5-30.5 billion for capital expenditures, to be sourced from a mix of internally generated funds and debts.

Metrobank will take P3-5 billion for information technology (IT) investments. FLI will have P7.4 billion for land banking, project development and IT investments. TMP will get P4.9 billion for the introduction of a new model, upgrading of specs and special projects. AXA will have P300 million for refurbishments, computer and IT upgrade, and office equipment.

The parent company will have P12 billion for acquisitions and other investments. The remainder will be divided among Toyota Manila Bay Corp., Toyota Financial Services Philippines Corp. and Sumisho Motor Finance Corp.

Shares in GT Capital at the stock exchange increased 17 centavos or 4.36% to P407 each yesterday. — Denise A. Valdez

Treasury turns down all bids for 35-day T-bills as rates increase

THE GOVERNMENT rejected all bids for the one-month Treasury bills (T-bills) it auctioned off on Tuesday as investors continue to ask for higher yields amid uncertainties caused by the coronavirus disease 2019 (COVID-19) pandemic.

The Bureau of the Treasury (BTr) rejected all bids for the 35-day T-bills it offered yesterday even as total tenders reached P29.617 billion, nearly twice as much as the P15 billion it had planned to raise.

Had it made a full award, the reintroduced 35-day tenor would have fetched an average rate of 3.39% with the highest bid at 3.5%, both above the 3.098% rate at the secondary market yesterday.

National Treasurer Rosalia V. de Leon said the BTr turned down all bids as the rates investors were asking for were higher than the PHP Bloomberg Valuation (BVAL) Service yields.

Despite the four consecutive full rejections in previous auctions since the enhanced community quarantine in Luzon started, Ms. De Leon said the government can still support its funding requirements despite an expected surge due to COVID-19-related expenses.

“Plenty of ammo — that’s why we rejected,” the official told reporters via Viber message yesterday.

Meanwhile, a bond trader said the result of the auction was expected due to high rates, adding that the Treasury seemed to be funded as it just received on Monday the payment for P300 billion worth of three-month government securities the central bank had agreed to buy last week at a zero interest rate.

“Also, not much demand given that time deposit rates for big accounts are high at mom (month on month). We might expect better demand for bills once BSP’s (Bangko Sentral ng Pilipinas) reserve cut materializes,” the trader added.

The trader said the trend of high rates and full rejections will likely continue in the next auctions “until banks can actually feel liquidity is coming in.”

The trader explained that most lenders are holding on to their cash in the meantime amid a spike in withdrawals, since the date for lifting the enhanced community quarantine (ECQ) will remain uncertain.

The BSP announced last week a cut in universal and commercial banks’ reserve requirement ratio (RRR) by 200 basis points (bps) to 12% effective Friday to release more liquidity. The cut is expected to free up some P180-200 billion in fresh cash into the financial system.

BSP Governor Benjamin E. Diokno has been authorized by the Monetary Board to cut banks’ RRR by a total of 400 bps this year. The central bank last week said reductions in the reserve ratios of other banks and nonbank financial institutions are also being studied.

Luzon is under a month-long ECQ until April 12 to contain and slow the spread of the virus which infected 2,084 and killed 88 in the country as of Tuesday. Officials have said the quarantine period can be extended or shortened as needed.

The Treasury has set a P190-billion local borrowing program for April, broken down into P130 billion in T-bills and P60 billion in Treasury bonds.

The government plans to raise P1.4 trillion this year from local and foreign lenders to plug its budget deficit, which is capped at 3.2% of gross domestic product. — B.M. Laforga

What a drag! Self-isolating Aussie queen takes routine online

SYDNEY — An Australian drag queen has shifted her performances from stage to personal screens during coronavirus lockdown in Sydney to ensure she’s not all dressed up with nowhere to go.

Penny Tration — born Daniel Floyd — is a professional artist who has appeared on radio and TV shows. She has also entertained at shopping malls and corporate functions and, when not in drag, worked for an airline for 12 years that only recently let her go as the global virus outbreak grounded flights.

Like many fellow Australians, Tration is in 14 days of mandatory self-isolation as she was on an overseas holiday. That hasn’t stopped her from attracting a global audience by live streaming her show, Tration in Isolation, via Facebook every Friday and Saturday night

“I’m grounded because of the coronavirus. My airline has stopped all international flights from the 30th of this month (March),” Tration told Reuters via webcam.

“Now, with the airline not flying, we’re all on stand down. No pay. No prospect of when we will go back,” she said, adding that some viewers sent her donations at the end of the show.

During the largely unrehearsed show, Tration sings, dances, and mixes herself cocktails while answering questions from viewers as they write in.

Even when isolation ends in a few days, Tration says she is not venturing outside anywhere too soon.

“I’m not going out until this virus is under control and I know that my actions can’t impact anyone else. I think, if other people knew this, when this was all kicking off, they would have done the same,” she said. — Reuters

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