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Peso flat ahead of Fed decision

THE PESO closed flat against the greenback on Wednesday as the market awaits clearer signals from the US Federal Reserve following its policy meeting.

The local unit ended at P49.19 per dollar on Wednesday, unchanged from its Tuesday close, data from the Bankers Association of the Philippines showed.

The peso opened the session flat at P49.19 per dollar, which was already its strongest showing. Meanwhile, its intraday low was at P49.24 against the greenback.

Dollars traded dropped to $551.71 million on Wednesday from the $849.4 million seen on Tuesday.

The peso’s flat finish showed the market was on the sidelines as they awaited the policy decision of the Fed, a trader said.

“The peso closed flat amid uncertainty from the US Federal Reserve’s monetary policy decision this Thursday,” the trader said in an email.

The policy-setting Federal Open Market Committee is reviewing policy from July 30-31, with the market hoping the Fed will keep rates near zero to support economic recovery.

For his part, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said the local unit closed unchanged following “weaker US consumer confidence data”.

Reuters reported that the US’ consumer confidence index decreased to a reading of 92.6 in July coming from the 98.3 in June, data from The Conference Board showed. This is also lower than a 94.5 estimate for the month from a Reuters poll of economists.

For Thursday, the trader expects the peso to move around the P49.10 to P49.30 levels versus the dollar while Mr. Ricafort gave a forecast range of P49.15 to P49.30. — L.W.T. Noble with Reuters

Stocks climb as investors await US stimulus plan

By Denise A. Valdez, Reporter

THE MAIN INDEX closed in green territory for the second consecutive day as investors stayed on the sidelines while waiting for news on the United States’ second coronavirus stimulus package.

The bellwether Philippine Stock Exchange index (PSEi) ended Wednesday’s session higher by 39.16 points or 0.66% to 5,966.27. The broader all shares index also gained 14.60 points or 0.41% to 3,508.24.

However, the PSEi spent most of the day with losses, dropping to as low as 5,870.83 before it recovered in the last hour to reach a peak of 5,966.27.

Investors are focused on the US government’s decision regarding its stimulus efforts to combat the coronavirus disease 2019 (COVID-19) pandemic, Timson Securities, Inc. Trader Darren T. Pangan said in a text message.

The US continues to lead the world in most COVID-19 cases, reaching 4.35 million as of Wednesday. US deaths due to the virus are also the highest in the world at 149,258, based on data from Johns Hopkins University.

US stocks ended Tuesday’s session with losses: the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite indices shed 0.77%, 0.65% and 1.27%, respectively.

Asian stocks were mixed as the PSE closed on Wednesday. Japanese and Taiwanese markets were trading in red territory while Hong Kong and Chinese markets were in the green.

Another factor that helped lift the PSEi was the easing of restrictions for more sectors starting next month. The government on Wednesday announced it will allow gyms, grooming centers, review centers and several other establishments to resume operations by Aug. 1.

“The easing of restrictions of local businesses have given optimism to investors but most remain cautious,” AAA Southeast Equities, Inc. Research Head Christopher John Mangun said in an e-mail.

“Most investors are still on the sidelines, evident in low trading volumes…, just half of the normal daily turnover,” he added.

Most sectoral indices at the PSE ended the session with gains. Industrials rose 128.92 points or 1.76% to 7,448.29; financials increased 11.98 points or 1.04% to 1,155.63; property added 20.55 points or 0.7% to 2,934.39; services climbed 7.19 points or 0.52% to 1,370.77; and holding firms improved 8.41 points or 0.13% to 6,199.70.

The only index with losses was mining and oil, which dropped 79.97 points or 1.47% to 5,335.45 at the end of session.

Value turnover stood at P3.57 billion with 1.18 billion issues switching hands, down from the previous day’s P4.31 billion with 1.96 billion issues.

Decliners outnumbered advancers, 103 against 74, while 47 names ended unchanged.

Net foreign selling continued to fall to P86.74 million from P415.60 million a day ago.

“Second quarter earnings continue to roll out as the week progresses. We’ll have to see if the index closes the week above the 6,000 area,” Mr. Pangan said.

COVID-19 audit sought as cases top 80,000

SEVEN senators have sought an audit of the government’s spending to fight a coronavirus pandemic that has sickened more than 80,000 and killed almost 2,000 people in the Philippines.

In a resolution, seven lawmakers asked the Commission on Audit to look at the expenditures as well as government loans and donations before Congress tackles the 2021 national budget.

“Congress early this year, through the Bayanihan Act, gave the government comprehensive powers, including the power to realign and allocate billions of taxpayers’ money to respond to the COVID-19 crisis,” Senator Risa N. Hontiveros-Baraquel said in a statement on Wednesday.

“We need to know if the help went to those who need it,” the opposition senator said in Filipino.

Senators Ralph G. Recto, Franklin M. Drilon, Juan Edgardo M. Angara, Panfilo M. Lacson, Francis N. Pangilinan and Leila M. de Lima also signed the resolution.

President Rodrigo R. Duterte on Monday asked lawmakers to pass stimulus measures to revive an economy on the brink of a recession caused by a coronavirus lockdown that is one of the world’s strictest and longest.

Analysts, business leaders and opposition lawmakers said he failed to say in his year address to Congress how exactly he planned to go about it.

The tough-talking Philippine leader urged lawmakers to support his economic recovery plan by fast-tracking the second version of the bill giving him special powers in dealing with the pandemic, including realigning government funds.

The first law that has since expired let him realign about P275 billion to state programs against the coronavirus. The second measure seeks to let him allocate another P140 billion for various programs during the health emergency.

Mr. Duterte, who is down to his last two years in office and barred by law from seeking reelection, is under pressure to revive the economy to keep his political capital and ensure the victory of his chosen candidate in the 2022 presidential elections. At least three presidents before him had either been sued or jailed for corruption.

The lawmakers cited issues of overpricing including in the purchase of a P4-million nucleic acid extractor compared with a similar equipment that the private sector bought for P1.75 million.

The government of President Rodrigo R. Duterte also bought personal protective equipment for P1,800 each, higher than the market price of P400 to P1,000, they said.

The senators also questioned the imports of COVID-19 test kits from China and Korea as locally made test kits that are cheaper, were left unused.

The special audit will help Congress decide on next year’s national budget, according to the Senate resolution. The Budget department is expected to submit a P4.5-trillion expenditure program to Congress next month.

“Anticipating that massive allocations will need to be made to address the health, economic and social impacts of COVID-19, it is of critical importance that there be audit findings to guide legislators,” the senators said in the resolution.

The resolution comes as the Senate starts a Committee of the Whole to probe alleged corruption at the Department of Health and Philippine Health Insurance Corp.

The chamber on Tuesday approved the bill extending Mr. Duterte’s special powers in dealing with the pandemic and easing procurement processes for medical supplies.

Also yesterday, the Department of Health reported 1,874 new coronavirus infections, bringing the total to 85,486.

The tally matched the projection made by University of the Philippines researchers on July 16. The researchers had said infections could top 85,000 by the end of the month, with 2,000 deaths.

The death toll rose to 1,962 after 16 more patients died, while recoveries increased by 388 to 26,996, it said in a bulletin.

Of the 56,528 active cases, 90% had mild symptoms, 9% did not show symptoms and less than 1% were either severe or critical, the agency said.

Of the new cases, 728 were from Metro Manila, 325 from Cebu province, 130 from Laguna, 67 from Iloilo and 53 from Rizal, DoH said. The data came from 83 out of 91 testing laboratories, it added.

There were now 166 candidate vaccines for COVID-19 and the number could reach more than 200, Food and Drug Administration Director General Rolando Enrique D. Domingo told an online news briefing, citing the World Health Organization.

Of these, about 140 were still in the early clinical trial phase, while 25 were in the clinical trial stage. Twenty of the 25 were in the first or second phases, where the drugs are tested using a smaller number of about 20 to 30.

Five of those in the clinical trial stage were in the third phase, where the drugs were being used on as many as 30,000 people, he said. Three of the drugs were from China, and one each from London and the US.

Mr. Domingo also said there are six candidate vaccines that could possibly undergo clinical trial in the Philippines, based on the update from the Department of Science and Technology.

The UP researchers earlier cautioned the government against “prematurely downgrading the quarantine status” in high-risk areas including Metro Manila and Cebu, where there had been a surge in COVID-19 infections.

They said Cebu City should remain under a strict quarantine, while the capital region should be kept under a general lockdown to ensure the gains made did not go to waste. The researchers also sought “more aggressive and effective localized lockdowns and stricter border controls.”

The targeted lockdowns in Manila and nearby cities should consider the health aspects of compliance, and the government should avoid treating it as a peace and order issue, they said. — Charmaine A. Tadalan and Vann Marlo M. Villegas

DoJ says it has death certificates of inmates who died of COVID-19

THE Department of Justice (DoJ) has received from prison officials the death certificates of 21 inmates who died of the coronavirus, nine of whom were convicted drug traffickers, according to the agency.

“These, along with the swab test results and other documents, will be turned over to the National Bureau of Investigation (NBI),” Justice Undersecretary Markk L. Perete told reporters in a Viber message on Wednesday.

Government agents are investigating the deaths of high-profile inmates at the national penitentiary in Muntinlupa City after the government was criticized for its alleged lack of transparency.

Mr. Perete said it would be up to the NBI whether it would disclose the contents of the documents pending the probe.

Justice Secretary Menardo I. Guevarra said the NBI submitted its initial report last week and a progress report may be submitted by the end of the week.

He welcomed the statement of Senator Richard J. Gordon, who said the blue ribbon committee that he heads would wait for the results of the NBI probe before starting its own investigation.

“I’m glad that Senator Gordon has decided to await the results of the NBI investigation before considering the conduct of a Senate probe on the same subject,” Mr. Guevarra told reporters via Viber. “The NBI has the necessary expertise to verify the relevant facts.”

Mr. Guevarra has ordered the NBI to probe the deaths of nine-high profile inmates including convicted drug trafficker Jaybee Sebastian. He was one of those who testified against opposition Senator Leila M. de Lima, who is now in jail for alleged drug trafficking.

The Commission on Human Rights on July 25 called out the BuCor and Justice department for their “lack of transparency and noncooperation.”

The human rights body said it had sent a letter to the DoJ asking for the list of inmates who died of coronavirus and those who were quarantined but had not received a response 15 days after.

The commission said prison and detention facilities in the Philippines are among the “direst places” in the country.

With 215,000 prisoners nationwide, Philippine jails and prisons are overfilled more than five times their official capacity, making it the most overcrowded prison system in the world, according to the World Prison Brief (WPB).

As of 2017, it had 933 jails — seven national prisons and 926 city, district, municipal and provincial jails, which are not enough to contain inmates, three-quarters of whom were at the pre-trial stage, WPB said on its website. — Vann Marlo M. Villegas

Gyms allowed to open with limited capacity

GYMS and review centers have been allowed to reopen with limited capacity in areas under a general lockdown starting August.

Allowed to operate up to 30% capacity were fitness centers and sports facilities, tutorial and review centers, Internet cafes, shops that offer personal grooming and aesthetic services, pet grooming and drive-in cinemas.

Testing centers may operate with no more than 10 people per room, Trade Secretary Ramon M. Lopez said in a mobile phone message on Wednesday. It can be fewer if social distancing can’t be enforced and the room is small, he added.

The government is also allowing more business activities in areas under a modified general community quarantine, including massage, tattoo and body piercing, live events and the entertainment industry, presidential spokesman Harry L. Roque said in a separate statement.

Libraries, museums, cultural centers, tourist destinations, as well as language, driving, dance, acting and voice schools will also be allowed under a modified general lockdown.

Some business operations are still banned, including cockfighting, beerhouses and kid amusement centers.

The Trade department is working with Health authorities in developing mandatory health protocols for each business activity.

Barbershops, salons, and dine-in operations at restaurants may operate up to 50% capacity in areas under a general lockdown, and up to 75% capacity in areas under a modified general lockdown. — Jenina P. Ibañez

Regional Updates (07/29/20)

New bird flu case detected in Pampanga

ANOTHER case of bird flu, involving the highly pathogenic avian influenza A (H5N6), was detected in an egg-producing farm in San Luis, Pampanga, the Bureau of Animal Industry (BAI) confirmed on Wednesday. BAI Director Ronnie D. Domingo, in a report to Agriculture Secretary William D. Dar, said 38,701 heads were depopulated and disposed of in accordance with protocols under the government’s Avian Influenza Protection Program. Mr. Domingo said initial field investigation showed the presence of migratory birds in the area, which has been associated with bird flu outbreaks worldwide. “The Department of Environment and Natural Resources has identified 117 important bird areas in the country, and about 150,000 migratory birds nest and breed annually in Central Luzon,” he said. The BAI official assured the consuming public that the bird flu strain was not reported and detected among broiler chickens, which are the primary source of poultry meat. “Early reporting, detection and strong multi-agency collaboration paved the way for the rapid and effective response in the management of the H5N6 incidence,” Mr. Domingo said. Last week, the Department of Agriculture announced the successful containment of the bird flu case in the town of Jaen, Nueva Ecija detected on March 13. — Revin Mikhael D. Ochave

Masbate going into lockdown Aug. 5–20

AS EARLY as February this year, health safety protocols such as body temperature check for arriving passengers were already being implemented at the Masbate City port.

MASBATE PROVINCE is imposing a lockdown on August 5 to 20 to give the local government and health authorities time to fully manage the increasing number of coronavirus disease 2019 (COVID-19) cases, particularly among returning residents. In an executive order released July 29, Governor Antonio T. Kho said the reopening of its borders on June 1 for locally stranded persons, overseas workers, and other returning residents “transformed” Masbate “from being a COVID-free Province into one with the second highest number of COVID-19 confirmed cases in the Bicol Region.” As of July 28, the region recorded 401 confirmed cases, with 230 active and nine deaths. Masbate accounts for 57 of the total cases with 50 active. Department of Health (DoH) Bicol Director Ernie V. Vera said there are no recorded community transmission in the region. “As of today, there is no declaration of local or community transmission in Bicol by the Epidemiology Bureau. However, it has been reported by the DoH Central Office that there are certain clustering in some barangays in the region. Clustering means there are two or more COVID-19 cases in the identified barangays,” Mr. Vera said in a statement posted Tuesday evening. Mr. Kho, in his order, said the temporary lockdown next month will allow authorities to complete contact tracing activities, avoid aggravating the “congested conditions of quarantine facilities,” prevent COVID-related deaths, and bring Masbate back again to a zero-COVID status. During the lockdown, no one will be allowed to enter or exit the province, except people transporting essential goods who will be subjected to medical assessment at the ports. Travel is allowed between towns and the capital Masbate City, including inter-island with permit from the barangay head. Bicol has two accredited testing laboratories, 39 intensive care unit beds, 268 isolation beds, 145 COVID ward beds, and 29 mechanical ventilators. All the different beds have a utilization rate of about 20% while ventilators are at 3%.

DENR closes down Calamba sanitary landfill

A 6.6-HECTARE sanitary landfill in Calamba City, Laguna was shut down for violations under its environmental compliance certificate (ECC). In a statement, the Department of Environment and Natural Resources-Environmental Management Bureau (DENR-EMB) said it served a cease and desist order on July 24 to the landfill operated by S.B. Hain Enterprises and General Services Inc. at Barangay Kay-Anlog. “We cannot allow the landfill and its operator to continuously harm the environment. The Calamba sanitary landfill will remain closed until violations are corrected,” DENR Undersecretary Benny D. Antiporda said. On July 13, an EMB team inspected the facility and found nine violations under the 26 conditions in its ECC. The operators also failed to install a working drainage and leachate treatment facility. — Revin Mikhael D. Ochave

Immigration, MWSS offices temporarily closed

THE WATER Regulatory Office in Quezon City has been temporarily closed starting July 29 until further notice after one of its employees tested positive for the coronavirus disease 2019 (COVID-19). In an announcement on Wednesday, the Metropolitan Waterworks and Sewerage System (MWSS) said it will adopt a work-from-home scheme for all employees while the office undergoes thorough disinfection. The COVID-positive worker is already under quarantine and other employees will undergo swab testing. “We advise our stakeholders to course all inquiries, concerns, and other communication through our official email account,” the MWSS said. “Rest assured that we will fulfill our mandate and service obligations through our current work arrangement and deliver vital and timely information through our official social media pages and website,” the agency added. Meanwhile, the Bureau of Immigration main office in Manila will be closed until Thursday to allow all its employees to undergo rapid antibody tests for coronavirus infection. Commissioner Jaime H. Morente, in a statement, said only about half of nearly 700 employees at the main office have so far been tested. The General Services Section also requested for more time to complete the disinfection, he added. Office operations were closed on Monday and Tuesday for disinfection after three employees tested positive for the disease through swab test. Satellite and extension offices in other parts of Metro Manila are open. “Those who have registered with our online appointment system will be notified or may inquire about their new schedule by contacting our hotlines that can be viewed at immigration.gov.ph,” he said. — Revin Mikhael D. Ochave and Vann Marlo M. Villegas

Mindanao conferences lined up for agriculture, business recovery

SEVERAL CONFERENCES are lined up in the third quarter this year to tackle programs and concerns of Mindanao’s agriculture and business sectors, and firm up plans for recovery from the impact of the coronavirus crisis. On August 27, the first stakeholders summit will be held for the Mindanao Aqua-Fisheries Development Program in Mati City, Davao Oriental. The summit is organized by the Davao Oriental provincial government with support from the Mindanao Development Authority (MinDA). The aqua-fisheries program, developed by MinDA, is one of the priority projects proposed for inclusion in the P2.1-B Rise Mindanao Grant Fund from the European Union. Aside from Davao Oriental, other coastal areas in the southern islands are being considered for funding, including those in the island provinces of Basilan, Sulu, Tawi-Tawi, Camiguin, and Dinagat. In September, the annual Mindanao Business Conference will be held virtually on the 10th-11th, with the Davao City business chamber as host. On Sept. 22–26, the Davao City chamber is also holding the 22nd Davao Agri Trade Expo (DATE) to sustain and establish new business opportunities in crops, livestock, and aquaculture. — Maya M. Padillo

Nationwide round-up

Court suspends transfer of inmates to BuCor facilities

THE OFFICE of the Court Administrator has directed courts to suspend the transfer of convicted inmates to facilities managed by the Bureau of Corrections (BuCor). The order was issued following a request from BuCor Director General Gerald Q. Bantag to prevent the spread of coronavirus infections. “(T)he issuance by the courts of commitment orders from BJMP (Bureau of Jail Management and Penology) jail units to the BuCor is hereby suspended, effective today until 31 August 2020,” the circular signed by Court Administrator Jose Midas P. Marquez read. The Department of Justice said more than 300 prisoners and employees have tested positive for the coronavirus disease 2019, with 21 deaths among prisoners, including nine high-profile inmates. The court administrator had also previously issued an order temporarily stopping the transfer of newly arrested individuals from local police units to jail units under BJMP, following the request of Interior Secretary Eduardo M. Año. BuCor handles the New Bilibid Prison, Correctional Institution for Women, the Leyte Regional Prison, and the penal farms in Davao, Iwahig, San Ramon and Sablayan. — Vann Marlo M. Villegas

Labor dep’t anticipates funding for informal sector, barangay employment programs

DoLE
PHILSTAR

THE LABOR department is expecting more funding for its assistance programs with the Senate’s approval of the second law covering the government’s response measures for the coronavirus crisis. In a briefing on Wednesday, Labor Undersecretary Joji V. Aragon said the overall P140-billion fund under the second Bayanihan to Heal As One Act will allow the Department of Labor and Employment (DoLE) to extend more help to workers who lost their jobs or livelihood due to the ongoing crisis. “Under Bayanihan 2, nakikita namin na baka at malaki ang posibilidad na maaprubahan po ang aming mga programa  (we see that it could and there is a big possibility that our programs will be approved),” she said. She said this includes funding for workers in the informal sector and the barangay-based emergency employment program. The Senate on Tuesday approved the proposed law, which includes a P17 billion fund for DoLE.

OFWs
Meanwhile, another 354 distressed overseas Filipino workers (OFWs) from Saudi Arabia arrived in Manila on Wednesday. “Unfortunately, some of our OFWs have been greatly impacted by the pandemic and we hope that our repatriation efforts would bring them comfort as they will soon join their families and loved ones,” Labor Secretary Silvestre H. Bello III said. DoLE has so far repatriated over 104,000 OFWs displaced by the global pandemic. — Gillian M. Cortez

Momentum building for 3rd round of social amelioration payouts

A THIRD ROUND of emergency subsidies for vulnerable households is needed because of the number of families who received no aid earlier, as well as the swelling in the jobless numbers since the completion of the first two rounds, a senior legislator said.

Representative Jose Ma. Clemente S. Salceda, who chairs the House committee on Ways and Means, estimated that another 1.7 million workers are expected to be displaced by the end of September due to the pandemic.

The government distributed two tranches of subsidies worth P5,000-8,000 to low-income households affected by the lockdowns, as provided under the Bayanihan law.

Mr. Salceda said some 2.2 million jobs affected by the lockdown were not accounted for when the registry for the social amelioration program (SAP) was completed in April. He noted that the total will likely increase to 3.6 million by the end of July.

He said some 3.3 million households have lost at least one income earner since the distributions were made.

“We estimate that by the third quarter, or end of September, another 1.7 million workers… will lose their part of, or their entire employment once the impacts of the subsidies and the wage protection programs wear off,” he said in a report.

“In other words, with an economic stimulus package, we may have to provide subsidies to 3.3 million households. Without stimulus, the number could swell to 4.2 million.”

Mr. Salceda projected that P21.4 billion would be needed to provide a one-month subsidy to 3.3 million households, or P27.3 billion for 4.2 million.

He said the government should start discussing the possibility of another round of emergency subsidies.

“I will defer to the Executive agencies on their final figures for how many non-SAP households have lost their income since SAP distribution began… what I will stick with is if the need exists,” he also said.

“We may come up with cash-for-work schemes or other forms of income replacement in lieu of an outright SAP.”

The Bayanihan 2 bill, which has just been approved by the Senate on final reading, provides for another tranche of emergency subsidy for low-income households in areas under enhanced community quarantine. — Charmaine A. Tadalan

Gov’t ‘studying’ rescue options after meeting with airline industry

THE GOVERNMENT has met with airlines and is “studying various alternatives” for reviving the industry, Finance Secretary Carlos G. Dominguez III said.

He did not elaborate about the options for the industry, which was among the hardest hit during the pandemic because of the idling of their fleets due to international and domestic travel restrictions, as well as a general reluctance to travel on the part of consumers.   

Mr. Dominguez said the exact content of the bailout remains fluid pending Congressional approval of economic recovery measures.

“We are studying the transportation industry and the conditions of the companies, (as) well as various alternative approaches, so as to be ready if, and when the law is passed and the IRR (implementing rules and regulations) prepared,” Mr. Dominguez said via Viber.

Officials of Philippine Airlines (PAL), Cebu Air, Inc. (Cebu Pacific), and Philippines AirAsia, Inc. said in early July that they were hoping for the prompt passage of the P1.3-trillion stimulus package, known as ARISE (Accelerated Recovery and Investments Stimulus for the Economy).

The proposed measure sets aside about P70 billion to aid the transportation sector this year.

The bill was approved by the House of Representatives last month but its counterpart measure is still awaiting committee-level approval at the Senate.

A separate piece of legislation, the P140-billion Bayanihan to Recover as One Act (Bayanihan II) bill, provides for a P17 billion rescue package for the transportation sector. The measure cleared the Senate on third and final reading Tuesday.

Bayanihan II was among the priority bills that President Rodrigo R. Duterte identified during his State of the Nation Address Monday.

In May, the Air Carriers Association of the Philippines (ACAP) appealed to Congress that the aviation industry might need around P8.6 billion per month to help them surive the crisis.

Their proposal involves P1.3 billion in wage subsidies, P500 million in foregone fees due to the government, and P6.8 billion in working capital.

Airlines have started to lay off employees, with PAL cutting 300 jobs in February after reporting losses in 2019. AirAsia Group was expected to reduce its workforce in the Philippines by 12%, while Cebu Pacific is looking at 800 jobs cut next month. — Beatrice M. Laforga

Palace orders property tax relief for some IPPs

PRESIDENT Rodrigo R. Duterte ordered the reduction of real property taxes charged against independent power producers (IPP) which participated in partnerships with the government in 2019.

The Palace released Executive Order (EO) No. 117 Wednesday calling for the reduction and condonation of real property taxes, interest, and penalties due from IPPs holding Build-Operate-Transfer (BoT) contracts with government-owned or controlled corporations (GOCCs) in 2019.

Mr. Duterte said in the EO signed on July 24 that IPPs generate tax revenue while providing around 3,100 megawatts worth of power.

“Their closure or non-operation will entail substantial losses to the government and force resort to more costly electric power source alternatives or the implementation of rotating power outages,” he said.

The EO said liabilities involving real property tax on property, machinery, and equipment used by the IPPs in 2019 under a BoT or similar arrangement with GOCCs will be “reduced to an amount equivalent to the tax due if computed based on an assessment level of fifteen percent (15%) of the fair market value of said property, machinery and equipment depreciated at the rate of two percent (2%) per annum, less any amounts already paid by the IPPs.”

The EO added that IPPs are exempt from paying interest and penalties on such  liabilities. — Gillian M. Cortez

North Luzon, Mindanao businesses retain optimistic outlook — PCCI

BUSINESSES in Mindanao and North Luzon are optimistic about recovery due to continued operations in the agriculture, outsourcing, and mining industries in their areas, the Philippine Chamber of Commerce and Industry (PCCI) said.

The Philippines’ largest business organization announced the findings of its meetings with chapter organizations. It also found that half of the member companies are not operating due to the lockdown, while employment among those partially operating is down 25-30%.

The chamber has said that extended lockdowns would force many companies to permanently close.

Mindanao businesses are welcoming new investment in health supplies ventures, including those making disinfecting materials like rubbing alcohol. Meanwhile, the North Luzon outsourcing industry continues to operate, PCCI President Benedicto V. Yujuico said in an online forum.

“Agriculture carries on despite logistics issues. There are potential investments for businesses (in Mindanao),” he said.

Mr. Yujuico added that the mining industry is growing, with ore exports continuing.

Meanwhile, businesses in the Visayas and South Luzon are suffering because 60% of their workers are in the tourism industry and related services, while industrial enterprises continue to be hampered by quarantines.

“The industrial and ecozones in South Luzon cannot fully operate because of the community measures still in place,” Mr. Yujuico said.

The PCCI said businesses are currently unable to make long-term plans because of uncertainty over when the pandemic will be contained.

Businesses have also been affected by spotty internet connection, cash flow and liquidity issues, transaction delays, lack of healthcare facilities, and problems with transportation and logistics.

“Financial support from the government is not enough or not being filtered down to the grassroots. Small enterprises are also wary of taking out loans, because it could lead to bigger loans, which could lead to bigger problems for them later on,” Mr. Yujuico said.

The Trade department’s interest-free small business loan program is overwhelmed with applications worth three times available funding.

The chamber said that it has been rolling out partnerships for loan guarantees, participating in a campaign promoting local consumption, and addressing red tape. — Jenina P. Ibañez

German chamber seeks more details on recovery plan

THE German-Philippine Chamber of Commerce and Industry (GPCCI) urged the government to release a detailed recovery plan and improve infrastructure to help businesses re-emerge from lockdown disruptions.

The chamber was looking forward to more details of the post-pandemic recovery plan during President Rodrigo R. Duterte’s State of the Nation Address, GPCCI President Stefan Schmitz said in a television interview Wednesday.

“What we were expecting more was more details to the recovery plan, like how do we get out of this crisis?”

Some businesses, he said, were operating with capacities as low as 50% during the lockdown as the companies took time to arrange staff housing and other requirements.

“Many have adjusted to the new normal. Manufacturing is up. Many people work from home. But again it is connected with additional costs,” he said, referring to transportation, testing, and safety protocols.

Mr. Schmitz, who is also the Managing Director of Antrak Logistics Philippines, said the company is working with a lack of infrastructure.

“We know that we rank high in logistics costs, and that is mainly because of congestion — be it in the ports, on the roads. Better infrastructure is really needed.”

The chamber supports the reduction of red tape and the government’s commitment to improve infrastructure.

Inefficiency and red tape, he said, continue to deter new investors.

The chamber in June called for the resumption of negotiations for a free trade agreement between the Philippines and the European Union.

“I think it could be a very important stimulator. We hear more and more the call from all sectors for stimulus packages from the government to get the economy running again and this could be a cornerstone of one of those things to level also the playing field,” Mr. Schmitz said. — Jenina P. Ibañez

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