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Start-ups and closures

I have yet to see data on how many businesses, particularly small and medium enterprises, in Metro Manila will not survive 2020 as a consequence of the COVID-19 pandemic. A few will probably start reopening by next week, some more perhaps by June 1. And of those that can resume by the second semester, I doubt very much if most will make it to the end of the year.

The most vulnerable, in my opinion, are freelancers, “professionals in general,” self-employed individuals, professionals working as consultants, small enterprises with limited cashflow, service enterprises with fewer than 10 employees, family-owned retail establishments, and small businesses run by families of overseas Filipino workers. Include on the list even small law firms, small medical and dental practices including neighborhood clinics, barbershops and salons, nail salons and spas, and small contractors and engineering firms. Small hotels and resorts and travel-related or travel-associated businesses, and travel-related transportation companies will also have much difficulty.

But while international travel and tourism may be dead in the water for now, I still see some opportunities in local or domestic tourism, particularly to destinations accessible by private land transport. Small families with private vehicles can still do weekends in private houses with pools or access to beaches; private lodges in cool climate destinations like Tagaytay and Baguio cities; and private farms with nature-related activities. It is a matter of how the owners of these private lodgings can strictly follow the required health and safety protocols.

But for many businesses that can still afford to restart, the concern is who can still afford to patronize them? A lot of people in the metropolis have lost their sources of income. Even those with some money tend to be more frugal in times of crisis. Business and consumer confidence are down. People are not ready to start spending for anything beyond basic necessities unless they are certain of surplus income in the medium to long term.

The Philippine Star has reported a recent survey by PwC Philippines indicating that less than 20% of start-ups in the country have enough cash to sustain their business operations for more than a year amid the impact of COVID-19. This was based on PwC-hosted discussions sometime last month with 90 start-up founders in the country. The survey showed only 19% of start-ups have cash good for over 12 months, while only 17% have the ability to sustain the business for more than 12 months if the enhanced community quarantine (ECQ) is extended, the Star reported. After May 15, Metro Manila, Laguna, and Cebu will be under modified enhanced community quarantine (ECQ) until May 31. It remains uncertain if this will be extended beyond May 31.

The Star also reported the survey showing that during the ECQ, 51% of start-ups have reduced their level of operations. One the bright side, 49% have also started offering a new product or service. My concern, however, is new offerings and the shift to the digital space is not enough to make up for what was lost and will be lost in the manufacturing, retail, and service industries.

Meanwhile, BusinessWorld reported that a survey last month by the Employers Confederation of the Philippines (ECoP) showed 67% of respondents said their companies postponed expansion or investment decisions because of COVID-19. The respondents were 148 large companies and 115 micro enterprises.

Only few respondents said they are observing normal operations, while 20% are on work-from-home setup. Another 26% said their business had to shut down due to the ECQ in Luzon, while 24% said they slowed down operations or maintained only a skeleton work force. Also, 22% saw a drop in demand for products and services; 19% said business dropped because of changes in work arrangements; and, 10% said they had difficulties paying salaries.

About 37% of respondents said they do not expect normal operations until after two to three months from ECQ lifting, while 14% said it would take them about six months from ECQ lifting to go back to normal. On the bright side, 38% said they expect operations to go “back to normal” a month after the lockdown ends.

Of the respondents, 34% also considered their companies poorly prepared to deal with the impact of COVID-19, while 28% said they do not have a written business continuity plan. Also, 64% have stopped hiring, while 9% said they laid off anywhere from 25% to 50% of their employees. For those who have kept their workers meantime, job cuts are expected in the future if the ECQ or the pandemic continue for another six months.

BusinessWorld also reported that Moody’s Investors Service already expects the country’s gross domestic product (GDP) to contract by as much as 2% this 2020. It quoted Moody’s as saying, “The rapid and widening spread of the coronavirus outbreak, deteriorating global economic outlook, falling oil prices, and financial market turmoil are creating a severe and extensive economic and financial shock.”

The Moody’s credit opinion shared with media on May 12 also noted, “As the ECQ will encompass much of the second quarter, we expect high-frequency data to continue to deteriorate despite the implementation of countercyclical policy stimulus, including handouts to vulnerable, low-income households.”

I take particular note of the comment of a Moody’s senior official, who reportedly e-mailed that the Philippine economic forecast was downgraded mainly due to the severity of the impact of the ECQ: “Given that we now expect the ECQ to last through most, if not all, of the second quarter, we are looking at an even larger contraction through the middle of the year.”

The official added, “Some of the key risks include the containment of the coronavirus outbreak itself, not just in the Philippines but also globally; an inability to contain the outbreak could lead to an even more prolonged imposition of measures that will weigh on economic activity.” But effective containment can result in “removal of restrictions on movement,” and this “will benefit consumption, allow people to return to work and alleviate the disruptions to the government’s infrastructure program.”

In a way, business under the COVID-19 environment is like pole-and-line fishing for tuna in open sea. The one with the longer line and stronger pole, as well as the patience and the determination to stay out in open water longer, can have better chances of catching fish. But, even the best pole and line, and bait, will be useless if the fish will simply not bite where you are. Or, there are just no fish to catch there. It all starts with knowing where to fish.

 

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

matort@yahoo.com

Drug pricing in Asia and WHO assembly

As the COVID-19 global pandemic lingers, the search for new medicines and vaccines continues as existing treatments and medicines cannot cope with virus mutation. Public policies on the pricing of innovative, newly invented medicines and vaccines are among the important considerations, whether these new treatments will become available in certain countries or not.

I checked the drug pricing policies of our neighbors in the ASEAN and developed Asia. A friend showed me a copy of the latest quarterly report of IQVIA (formerly IMS Health) as it is a by-subscription paper only. Only the Philippines instituted a new drug price control policy, Malaysia plans to have one but no details are available at the moment. The rest use mechanisms that are more market-oriented and not coercive (see Table 1).

February’s EO 104, which imposed a max wholesale price and a max retail price for certain drugs, is on top of drug price control under EO 821 (July 2009, Gloria Arroyo administration) which remains in effect until today.

IQVIA also produced a country report on “Access to Innovation.” The main objective of the study is to understand the Philippines’ access to innovative medicines. I am thankful to another friend who shared with me that by subscription-only report.

The result is not good – so many new medicines, more disease-killing treatments are available in the developed world but are either not available in the Philippines, or made available only after more than two years (see Table 2).

The old EO 821 price control, threats of patent-confiscation via compulsory licensing, and endless attempts to have another round of drug price control, are among the factors why this thing happens.

There is a possibility — a danger — that when new treatments and vaccines are available against COVID-19 by early 2021, they may not be made available in the Philippines because of existing policies like price controls that penalize innovators.

President Rodrigo Duterte, Health Secretary Francisco Duque III, Senator Bong Go and other the other senators that pushed for price controls should be aware of the dangers of their policy. There are many mechanisms that government can take to have cheaper medicines like more competition among more innovators, negotiated pricing, bulk purchase, RSAs and PVAs, as shown in Table 1e.

On May 18, the member states of the World Health Organization (WHO) will gather in Geneva for the World Health Assembly and they will discuss new policies to fight the COVID-19 pandemic, among others.

That same day, a global coalition of 31 independent, non-government think tanks will release a new report, “A Joint Declaration on the Importance of Collaboration, Open Trade, and Innovation in Tackling COVID-19” (May 2020). Of these 31 think tanks, five are from the ASEAN: CIPS and Paramadina Institute (Indonesia), the Galen Center and KSO Institute (Malaysia), the Adam Smith Center (Singapore), and Minimal Government Thinkers (Philippines).

Our paper suggests seven simple measures that governments can make to save more lives now:

1. Abolish tariffs on medical supplies and medicines;

2. Reject export bans on medical supplies;

3. Reduce Customs red tape;

4. Enable the free flow of relevant health data across borders;

5. Maintain transparency in collecting and sharing epidemiological data;

6. Increase cooperation with other countries to speed up drug approval; and,

7. Support innovation, including intellectual property rights.

We hope that member-governments of WHO will consider these points. Private investments and research have a natural inclination to find new solutions to old and emerging problems, they just need to be unshackled from various restrictions, regulations, and high taxation by governments.

 

Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers.

minimalgovernment@gmail.com

Working at home

By Tony Samson

A COMMON PLACE for work became the “new normal” after the industrial revolution in the western world of the 1800s. The then agricultural economy, that itself founded villages, went on to large scale manufacturing, drawing laborers from the rural population to work in the assembly lines to produce such items such as automobiles and steel bars. This development separated the home from the place of work. The subsequent revolutions like the Information Age, as well as the rise of the service sector, led to even larger office buildings and the introduction of cubicles.

The home then became just a living space with work and employment done somewhere else. The two sites were not necessarily near each other. There was a commute time between home and office, often longer than the lunch and coffee break combined. Working from home (WFH) due to the enhanced community quarantine (ECQ) is now trumpeted not as a solution to traffic congestion (remember telecommuting?) but as a new form of social distancing, known as the new normal.

Working at home is actually two centuries old. It can thus be classified as the very old normal. The blacksmith of that period lived above his shop and so technically worked at home. Monks too lived in the monastery where they grew vegetables. The haberdashers, morticians, and saloon keepers had both work and residence in one place.

Even in contemporary times, before the lockdowns, many productive individuals worked at home. The residence is referred to as the “home office,” as differentiated from this same phrase designating the headquarters of a multinational company. However, these home workers we refer to were not locked down and confined, as they were free to go out not just for groceries, but to dine out, go to the gym, or meet clients. They were not thrown down by the police for handcuffing in case they wandered out without a face mask and shirtless in their own driveways.

The home economy includes many in the food business. Didn’t we buy fruitcakes for Christmas gifts from a house in the neighborhood? These can also broaden their product offering to include lemon tarts and baked ham. Before long, customers picking up their orders get so numerous that the neighbors start complaining about clogged streets. So these home businesses evolved into restaurant chains… with a new commissary outside the home.

Writers too, not necessarily local ones, work at home. The disciplined ones, like Stephen King with 80 or so novels, devote a particular block of time to writing every day at home, except on designated holiday breaks. Some, like Desmond Morris, even dress up in a suit, to go downstairs to his home office to write. This attire draws the line between lounging around and working.

We know of a venture capitalist who works at home in his pajamas, cooking up deals and putting together funding and partnerships for acquisitions of hospitals and agribusiness ventures. Of course, he also goes out for lunch, to celebrate with his partners when a deal is done. And confers with lawyers when the pesky management of an acquired enterprise refuses to retire.

What about those who offer home services like extracting blood for lab tests on cholesterol levels, home massage complete with folding beds, and care-giving and sponge bathing for the elderly? These services are not necessarily offered by the same person.

The informal sector (sometimes referred to as the “underground economy”) is quite hospitable to personal services that don’t require an office, and the overhead that entails. We are only including in this category legitimate pursuits, or at least those not specifically illegitimate for which no warrant of arrest is necessary for apprehension or even outright elimination for resisting arrest, usually reported later as self-defense.

The home worker may eventually hire an accountant and pay some tax to avoid undue harassment. She can form a single person corporation (SPC) so she can legitimately deduct expenses for utilities and the renovations needed to accommodate proper ventilation.

The oldest profession, landscape architecture, is provided at the customer site, usually on a one-on-one basis. (Sir, do you want a rock garden?) This professional works from home and relies on word of mouth marketing and referrals, much like a dentist. For the home worker, the smartphone is an essential piece of equipment for taking orders. And if she wants to change her customer base, a new SIM card is all she needs — who is this please?

 

Tony Samson is Chairman and CEO, TOUCH xda.

ar.samson@yahoo.com

NBA gaining ‘momentum’ toward season resumption

FOLLOWING a Board of Governors call with commissioner Adam Silver on Tuesday, the National Basketball Association (NBA) is “increasingly positive about the league’s momentum” toward resuming the 2019-20 season, ESPN’s Adrian Wojnarowski reported.

Per the report, owners and executives were encouraged about the league’s steps toward returning safely amid the coronavirus pandemic and about positive conversations with the National Basketball Players Association (NBPA).

The report added that Silver emphasized that in order for a return to occur, all parties would need to accept that a single positive test for COVID-19 would not derail the season.

If a positive test would “shut us down, we probably shouldn’t go down this path,” Silver said, per Wojnarowski.

The report added that it remains unclear at what point numerous positive tests would impact the schedule.

Wojnarowski also reported that the format for the return play remains unknown, in terms of regular-season or playoff structure.

The NBA also reportedly continues to vet the possibility of holding all games in neutral sites, with Orlando and Las Vegas the leading candidates, in what Silver referred to as a “campus environment.”

Both Wojnarowski and The Athletic’s Shams Charania reported that the NBA aims to decide within two to four weeks whether to restart the season.

A potential roadblock to the proposed resumption is that the league doesn’t believe “rapid response testing” will be readily available inside of a month.

Earlier Tuesday, the NBPA informally polled players to gauge where they stand on restarting the season, Wojnarowski reported.

NBPA regional representatives began asking players to respond to a “yes or no” question about their desire to return to the court during the coronavirus pandemic, sources told Wojnarowski.

Some teams were asked the question in group texts, per the report, and names of the players and their individual responses will be kept confidential.

However, in a statement to The Athletic, the NBPA said it “is not engaging in and has not authorized any formal poll of its players.”

NBPA executive director Michele Roberts, executive committee members including president Chris Paul and other players held a conference call Friday with Silver to discuss various topics related to resuming play, chiefly health and finances.

Yahoo Sports’ Chris Haynes reported Paul held a private conference call with superstars across the league on Tuesday, with all wanting to resume the season at some point.

Per the report, LeBron James, Anthony Davis, Kevin Durant, Giannis Antetokounmpo, Kawhi Leonard, Stephen Curry, Damian Lillard and Russell Westbrook were all on the call, and “all parties were in agreement to take the court with proper safety measures” once that proves possible.

The NBA suspended the regular season on March 11 after Utah Jazz center Rudy Gobert tested positive for COVID-19. — Reuters

Challenges ahead for local football but stakeholders hopeful

PFF president Nonong Araneta

LOCAL FOOTBALL will have it challenging as long as the coronavirus disease 2019 (COVID-19) pandemic remains a going concern for the country. But stakeholders remain hopeful that in due time some semblance of normalcy can be achieved.

Speaking at the newly launched Heroes of Halftime with Audris Romualdez podcast last week, Philippine Football Federation (PFF) President Nonong Araneta and Stallion Laguna FC owner and coach Ernie Nierras said like everybody in the local sporting community, football has been made to adjust greatly in light of the episode with the highly contagious COVID-19.

While the current situation is unfortunate, they said, it is completely understandable that sporting affairs have to cease for now and allow more pressing concerns to be given priority.

“At the moment all sporting activities are cancelled. Sports are taking a backseat and they are the last priority,” admitted Mr. Araneta.

Messrs. Araneta and Nierras said given the cloud of uncertainty over COVID-19, it remains to be seen when the football machine can really be back in full throttle but from their end they said they are ready to go back and continue the sport’s push when conditions permit it.

The PFF, Mr. Araneta said, is committed to continue promoting football by way of the Philippines Football League (PFL) and grassroots programs and age-group tournaments they have lined up in different parts of the country.

The PFL was reset to commence this month, from an original schedule of March 21, but with the enhanced community quarantine still up on different areas, including the National Capital Region, it is set to be pushed back anew.

Mr. Araneta, however, said that if and when the PFL gets under way it will be without fans in the venues in compliance with the social-distancing guidelines of the government as a mitigating measure to help stop the spread of COVID-19.

The PFF president also said plans are also up to put a football academy in Carmona, Cavite, to further cultivate available talent.

For their part, Mr. Nierras said work continues for Stallion FC despite the delay in the start of the PFL.

“Myself and our team trainer we created a program even before the pandemic where the players can continue training. The players train on their own and they are obligated to video their training so we can track them and their progress,” said Mr. Nierras.

“It’s challenging but it’s not a problem. They are professionals and they know what to do. But definitely they miss playing. We are looking at this as a new opportunity not a problem,” he added.

As to what lies ahead, Messrs. Araneta and Nierras said it is important for the community to come and work together to set the football push back on track. Help from other sectors, too, would go a long way.

“Hopefully the government can come with the guidelines not only for football but sports in general to allow things to continue,” said Mr. Araneta.

It is something that Mr. Nierras shared while also highlighting there are no longer boundaries under the “new normal.”

“In the new normal there are no boundaries. There is no expertise specifically for one thing. People have to realize we have to work together, the business industry with the sports association and what have you. From a football perspective I like to believe things will only get better,” said the Stallion FC coach. — Michael Angelo S. Murillo

PSC beefing up measures heading into the new normal

ACKNOWLEDGING that local sports has been changed considerably by the coronavirus disease 2019 (COVID-19) pandemic, the Philippine Sports Commission (PSC) is working and strengthening its legs heading into the “new normal” of doing things.

Led by Chairman William Ramirez, the PSC held a board meeting online on Tuesday where it discussed measures to be taken by the body as COVID-19 continues to be a concern at the moment and moving forward.

Foremost of the measures was establishing a health and safety committee that would oversee the handling of related matters in the agency in accordance with the occupational and health safety standards for public sector issued by the Department of Health, Civil Service Commission of the Philippines and Department of Labor and Employment.

Executive Director Merly Ibay was named head of the committee, with Deputy Executive Directors Dennis Rivera and Atty. Guillermo Iroy, and Chief of Staff Marc Velasco serving as deputies.

Also tackled was the creation of a framework for the reintroduction of outdoor physical activities and sports in coordination with the DoH, something Mr. Ramirez said is important in slowly opening up things for the sporting community.

The PSC also underscored that it is committed to dispensing its duties even in these trying times, including ensuring that their budget is at par to whatever direction they are going to take and carrying out its oversight functions over grassroots programs and national sports associations.

“The whole sporting world, national sports has to change. It has to shape its direction moving forward…There has to be adjustments. We cannot be complacent and just return to what we were doing before…” said Mr. Ramirez of how things will be in the new normal brought about by COVID-19.

Meanwhile, the PSC lauded the Senate’s ratification of the bicameral report on the establishment of a National Academy for Sports early this week.

The PSC said the turn of events is a welcome development in line with the vision of shoring up sports development in the country and providing opportunities for the youth to have a career in sports.

“The Board is unanimous in saying that this is a welcome development. Anything that supports the development of sports in the country is a great boost to the country’s efforts to build a deeper grassroots sports program which feed our elite sports programs,” said Mr. Ramirez in a statement.

“The National Academy of Sports (NAS) is a welcome development in the institutionalization of sports in the Philippines. This will be an avenue for us to produce world-class Filipino athletes. Moreover, the athletes will also be academically adept while pursuing their dreams for sports excellence,” PSC Commissioner Celia Kiram, for her part, said.

The envisioned academy looks to jointly push for world-class sports training and quality secondary education for the young people of the country. — Michael Angelo S. Murillo

London mayor opposes Premier League’s June restart

BENGALURU — London Mayor Sadiq Khan is opposed to the idea of the Premier League resuming in the capital next month while the COVID-19 pandemic continues to cause hundreds of deaths in the UK each day, a spokesperson for the mayor’s office has said.

The possibility of a restart next month was given a boost when the government said elite sport could return behind closed doors after June 1.

“Sadiq is extremely keen for the Premier League and professional sport in general to resume,” the spokesperson told the Evening Standard.

“However, with the country still in the grips of this crisis, and hundreds of people dying every day, he believes that it is too early to be discussing the resumption of the Premier League and top-flight sport in the capital.”

Five Premier League clubs are based in London — including Arsenal, Chelsea and Tottenham Hotspur.

“As a Liverpool fan, Sadiq of course wants the Premier League to return,” the spokesperson added. “But it can only happen when it is safe to do so, and it cannot place any extra burden on the NHS and emergency services.”

Liverpool leads the league with nine rounds remaining and needs only six points to seal the title.

An official protocol sent to Premier League players and managers outlining conditions for returning to training said pitches, corner flags, cones and goal posts would have to be disinfected after each session.

Players will be tested twice per week for the virus and take a daily temperature check, while they will also be forbidden from congregating together or travelling to or from training with teammates.

The United Kingdom is the worst-affected country in Europe with over 32,000 deaths reported due to the new coronavirus while there are more than 223,000 confirmed cases. — Reuters

Tests await players as PGA Tour prepares for return

TORONTO — Golfers and caddies returning to the PGA Tour next month will face a battery of tests and safety measures as they adjust to tournament golf in the era of novel coronavirus.

Golf Channel said on Tuesday it had seen the 37-page health and safety document being sent to players as the PGA Tour, shut down since mid-March by the COVID-19 pandemic, prepares for a June 11-14 return at the Charles Schwab Challenge in Fort Worth, Texas.

Players can expect a “layered testing approach” according to Golf Channel, which will start at their homes. They will receive a pre-travel screening test and be tested again on arrival at the tournament.

Testing will be required as a condition of competition.

Anyone testing positive will be removed from the competition and self-isolated for at least 10 days. A player who tests positive after making the cut at an event will receive last place earnings.

Players, caddies and tournament officials will be kept inside a tournament bubble at one or two hotels and a charter plane will take them to the next tournament to limit possible exposure.

Everybody must be tested again before boarding the charter.

Golfers are also encouraged to perform many of the tasks left for their caddies, such as selecting and replacing clubs or whatever they need from the bag.

“I don’t know what even to expect,” Brooks Koepka, winner of four majors, told Golf Channel. “I am assuming no fans, that’s been said, but I am kind of in the dark. I don’t know too much about it.

“Whatever restrictions they put on, I am going to be in the first three events, so whatever I need to do to play those three events I am going to make sure I do.”

In addition to the Charles Schwab Challenge the tournaments set to be held without fans are the RBC Heritage (June 18-21) in Hilton Head, South Carolina, the Travelers Championship (June 25-28) in Cromwell, Connecticut, and the Rocket Mortgage Classic (July 2-5) in Detroit.

The first tournament tentatively preparing for spectators is the July 6-12 John Deere Classic in Silvis, Illinois, followed by the Memorial. — Reuters

Globe employees volunteer as customer service reps during crisis

In a pandemic, how can a company continuously serve its millions of customers with the closure of Business Process Outsourcing (BPO) companies and other vendor partners? The answer is malasakit and volunteerism.

Globe put into action an employee volunteer program to  fill the void caused by the temporary shutdown of its outsourcing partners when the enhanced community quarantine took effect in Metro Manila last March 16.

The employees, belonging to different teams in Globe, were reskilled and trained to properly handle back office requirements and after sales support.  Some were tasked with responding to customer concerns sent through private chats and public posts on Globe’s official social media channels while a group was  assigned to process requests for broadband service, among others.

Jenny Kho-Villon, an employee volunteer, makes use of her experience as Retail Manager of  the Globe Store in J.Center Mall Mandaue City to perform her new role effectively.  “It’s a good thing I am from the Store as I have the background on how to do this. Also, Globe made sure that we undergo training prior to giving us applications to encode,” she said.

Although the current number of volunteer employees only represents a fraction of the company’s regular manpower requirement, the team works untiringly to deliver the necessary services.

“I welcomed the task. Before the ECQ, I had installed all the web tools required to work from home. I applied the agile mentality, made mistakes early and adapted quickly to become an expert encoder so I can help others by sharing my best practices,” said 39-year old Rainer del Rosario, an analyst for Customer Service Management Operations. “We were needed due to the backlogs so I made extra effort to give back to Globe for all the blessings I received.”

Jennifer Anne M. Misa, a Globe Assistant Retail Manager who has been with the company for 17 years, said:  “ I took on this job because I really wanted to help after I found out that there were a lot of pending wireline applications.  I saw this as an opportunity to give back, make good use of my time by using my stock knowledge in a productive way.  What was most rewarding is that this experience gave me a sense of fulfillment knowing that I was able to help other groups in the organization.”

Training employees as backup for different  business functions  is  part of the company’s business continuity plan in case unexpected events such as a pandemic occur.

“Knowing that telecommunications is an essential service especially at this time, we can’t afford not to be there for our customers.  We want to ensure that our customers are continued to be cared for by providing them with connectivity and by responding to their other needs.  We are thankful to our employees who selflessly offered their time and effort to keep our after sales services running despite the difficult situation that we are all in,” said Rebecca Eclipse, Globe Chief Customer Experience Officer.

Globe, for its part,  keeps the employees safe through various health protocols it is implementing and makes sure that employees have unlimited access to licensed doctors for medical advice and information.

Meanwhile, Globe encourages its customers to use self-service apps such as GlobeOne (https://www.globe.com.ph/apps-content/globeone.html) and TM App to keep track of data usage, pay bills, and subscribe to promos; Globe At Home https://www.globe.com.ph/apps-content/globe-at-home.html) for all account-related concerns; and GCash App (https://www.gcash.com/) to buy load, pay bills, send money, and book movies, among others.

 

Phase 1, 3rd Leg of BUSINESSWORLD INSIGHTS: COVID-19 and the Philippine Stock Market

As economies are put to a halt due to the COVID-19 pandemic, global markets and investments took a deep dive. Is there a silver lining ahead for the Philippine stock market?

Learn that and more at the third leg of the phase 1 of BUSINESSWORLD INSIGHTS: An Online Forum Series with the theme, “COVID-19 and the Philippine Stock Market: Uncertainties and Opportunities”, with Ramon Monzon, Philippine Stock Exchange Inc. president and CEO; April Lynn Tan, COL Financial VP and head of research; and Japhet Louis Tantiangco, Philstocks Financial, Inc. senior research analyst, moderated by Leo Uy, BusinessWorld research head.

#BUSINESSWORLDINSIGHTS is made possible by SM, Megaworld, Globe, PayMaya, National Home Mortgage Finance Corporation, Olern, and The Philippine STAR with the support of Management Association of the Philippines, Philippine Chamber of Commerce and Industry, Philippine Association of National Advertisers, Bank Marketing Association of the Philippines and CFA Society Philippines.

NASA, partners launch virtual hackathon to develop COVID-19 solutions

The U.S. space agency National Aeronautics Space Administration (NASA), European Space Agency (ESA), and Japan Aerospace Exploration Agency (JAXA) are inviting coders, entrepreneurs, scientists, designers, storytellers, makers, builders, artists, and technologists to participate in a virtual hackathon May 30-31 dedicated to putting open data to work in developing solutions to issues related to the COVID-19 pandemic.

Since the start of the global outbreak, Earth science specialists from each agency have been exploring ways to use unique Earth observation data to aid understanding of the interplay of the Earth system – on global to local scales – with aspects of the COVID-19 outbreak, including, potentially, our ability to combat it. The hackathon will also examine the human and economic response to the virus.

During the global Space Apps COVID-19 Challenge, participants from around the world will create virtual teams that – during a 48-hour period – will use Earth observation data to propose solutions to COVID-19-related challenges ranging from studying the coronavirus that causes COVID-19 and its spread to the impact the disease is having on the Earth system. Registration for this challenge opens in mid-May.

“There’s a tremendous need for our collective ingenuity right now,” said Thomas Zurbuchen, associate administrator for NASA’s Science Mission Directorate. “I can’t imagine a more worthy focus than COVID-19 on which to direct the energy and enthusiasm from around the world with the Space Apps Challenge that always generates such amazing solutions.”

The COVID-19 Challenge will be the program’s first global virtual hackathon. Space Apps 2019 included more than 29,000 participants at 225 events in 71 countries, developing more than 2,000 hackathon solutions over the course of one weekend.

Since 2016, many Filipinos have participated in this annual hackathon. Recently, a dengue mapping forecasting system was developed by data scientists from CirroLytix using satellite and climate data with the goal of addressing the sustainable development goals of the United Nations. This web application, called Project AEDES won globally for the best use of data. “Earth observation data has the potential to be used in fighting epidemics and outbreaks threatening humanity nowadays, as well as to analyze its socio-economic impact,” according to software developer Michael Lance M. Domagas, who led the Philippine hackathon in collaboration with De La Salle University, PLDT, Department of Science and Technology, United Nations Development Programme, and the U.S. embassy.

The very first Philippine winner used citizen science and environmental data to develop a smartphone application informing fishermen the right time to catch fish. ISDApp is currently being incubated at Animo Labs.

Space Apps is a NASA-led initiative organized globally in collaboration with Booz Allen Hamilton, Mindgrub and SecondMuse. The next annual Space Apps Challenge is scheduled for October 2-4.

Registration opens May 12. You can learn more about the event here.

Positioning the real estate industry for a post-pandemic world

By Bjorn Biel M. Beltran
Special Features Assistant Editor, BusinessWorld

The coronavirus pandemic has all but stopped the property industry in its tracks. For the past few months, real estate has essentially become a waiting game for both investors and developers as the nationwide quarantine put a stop to the growth of businesses everywhere.

Analysts at the property consultancy firm Colliers International predicted in an online webinar that land values in Metro Manila will drop by as much as 15% by end of the year, as rents and selling prices decline due to the pandemic, even in the country’s busiest business districts.

“For the first quarter of 2020, we’re seeing a 5-15% reduction in land values. We see this for the likes of Makati CBD, Fort Bonifacio, and the Manila Bay area,” Colliers Philippines Research Manager Joey Roi H. Bondoc said.

According to Colliers data, the Makati central business district is projected to see a 10% drop in land value to P773,000 per square meter (sq.m.) by the fourth quarter. Land values in Fort Bonifacio are also expected to decline 10% to P745,000 per sq.m.; in Manila Bay area by 15% to P332,000 per sq. m.; and in Ortigas Center by 5% to P337,000 per sq. m.

Contractions are expected to reverberate across the different real estate segments, from office space to retail, at least until 2021 or 2022. Colliers sees higher office vacancy in 2020 due to a slowdown in leasing activities following the adverse impacts of the pandemic and lockdown in Luzon.

Residential demand in the metro is also expected to soften this year due to the impact of the COVID-19 pandemic, with the only hope of recovery contingent on the successful containment of the virus within the first half of the year.

Meanwhile, retail demand faces the challenge of a marked slowdown of the country’s economy, erosion of consumer confidence as well as implementation of physical distancing measures post-pandemic.

Adapting to a post-pandemic world

To mitigate the impact of COVID-19, Dom Fredrick Andaya, Colliers Philippines director for office services, suggested that real estate developers take small, incremental steps to better position their businesses post-pandemic.

“We need to take incremental decisions during this period. Information, in terms of what’s going to happen or what the returns will be, will not be available. But we need to make decisions,” he said.

“By taking incremental actions during this period, we might see a rebound sooner rather than later. And we would avoid worst-case scenarios.”

Opportunities could lie in catering to the business process outsourcing industry, he added, as foreign companies take advantage of the lower costs of outsourcing to kickstart their operations abroad after the pandemic.

“BPOs thrive because of cost pressures. And because of COVID, doing business will even become more expensive. That’s applicable globally,” he said.

“Of course, there are technology solutions to address cost pressures, but outsourcing remains to be an effective way of addressing those cost pressures. Demand has slowed down, but we would see another surge of outsourcing eventually in the next several months, similar to what happened in the past.”

Richard Raymundo, Colliers Philippines managing director, also noted that the pandemic could also fast-track foreign investors’ plans to establish offices outside Metro Manila to create better resilience in their operations in the future.

“[Investors] want to have an office in the north and one in the south so that if something happens like this, their workforce is geographically diverse. It won’t be difficult for them to adjust. That could be one interesting trend that we’re gonna see after this,” he said.

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