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PPA says unsolicited proposal for Port of General Santos still under review

THE Philippine Ports Authority (PPA) said it is still reviewing the unsolicited proposal by a Davao-based private terminal operator to rehabilitate the Port of General Santos.
“In terms of GenSan, we’re still sorting out ’yung sa engineering also. Because what we want to happen is… make sure na ’yung proposal ng mga proponents [the proposals of the proponents] will be compliant with the (PPA’s) long-term development plan,” PPA General Manager Jay Daniel R. Santiago told reporters in a Mar. 15 chance interview.
Last year, Mr. Santiago said Kudos Trucking Corp. submitted to the PPA an unsolicited proposal to rehabilitate and improve the General Santos Port and add new equipment such as cranes.
“Pag na-submit ’yung engineering, and convinced ’yung engineering group namin doon sa feasibility nung design at compliance nung design sa development plan ng PPA, [Once they submit the engineering, and our engineering group is convinced with the feasibility of the design and its compliance to the development plan of the PPA], then we can now proceed to evaluating it for original proponent status (OPS),” he said, noting they don’t have a target timeline for awarding OPS until Kudos Trucking submits its revised engineering plan.
The PPA is currently reviewing two unsolicited proposals from private groups for government-owned ports, the other being Chelsea Logistics Holdings Corp.’s P11.2-billion plan for the Sasa Port in Davao.
Aside from the two, International Container Terminal Services, Inc. (ICTSI) also submitted last year a letter of intent to the PPA to modernize, operate and maintain the Iloilo Port Complex and the Port of Dumangas in Iloilo.
Mr. Santiago said they are still waiting for the company to submit the financial, technical and legal provisions of its proposal.
“Nag-submit sila ng letter of intent for Iloilo [They gave a letter of intent for Iloilo], but they have yet to submit the meat of the proposal,” he said.
The Razon-led port operator disclosed to the stock exchange last year it is investing P5 billion for the project. — Denise A. Valdez

DMCI’s Kai Garden Residences generates P13-B sales

DMCI HOMES said its Japanese architecture-inspired condominium development in Mandaluyong has posted P13.3 billion in reservation sales as of Feb. 28.
The three-tower development, located along M. Vicente Street, is already 88% sold with only 383 units left from its inventory.
“The robust sales of Kai Garden Residences is encouraging. It inspires us to continue to come up with new products that prioritize the discriminating taste and preferences of our customers,” DMCI Homes Senior Vice President for Sales Florante Ofrecio was quoted as saying in a statement.
Condo units’ gross floor area ranges from 28 to 81.5 square meters, with prices starting at P4.6 million.
DMCI Homes targets to complete the Sugi building by January 2023, Icho building by January 2024, and Hinoki building by June 2024-January 2025.
Kai Garden Residences offers open spaces patterned after a traditional Japanese garden.
“It’s a Japanese-inspired design which seeks to provide a seamless transition from the outdoors to the indoor environment. The Sky Patios and Atriums are strategically positioned so that light and air can naturally flow within the building,” DMCI Homes Senior Architect Fe Moselina said.

Domestic market capitalization of select stock exchanges in Asia Pacific (February 2019)

Domestic market capitalization of select stock exchanges in Asia Pacific

How PSEi member stocks performed — March 25, 2019

Here’s a quick glance at how PSEi stocks fared on Monday, March 25, 2019.

 
Philippine Stock Exchange’s most active stocks by value turnover — March 25, 2019.

Chambers back privatization gains for water

THE Makati Business Club (MBC) said the privatization of water delivery in the Philippines resulted in “indisputably better” services, with the process “considered a model around the world.”
In a statement, the MBC defended the concession system for water delivery even as it joined in the call for “accountability” for the water crisis as well as “long-term solutions” to ensure sustainable water supply for Metro Manila, on both the supply and demand side and measures to speed up the approval process for water projects.
“Makati Business Club supports the efforts that (Metropolitan) Waterworks and Sewerage System, other authorities, and Manila Water Co. are taking to investigate the water shortage that occurred this month in order to alleviate the situation, take steps to avoid or limit a repeat, and determine accountability and responsibility,” it said in a statement.
“MBC recognizes that it is critical for the government, the concessionaires, and other stakeholders to develop long-term solutions for both supply and demand. MBC stands ready with other business organizations to gather business sector inputs and support for these efforts. The most important among these solutions are to prioritize the development of and streamline the approval process for new water sources, but also include more efficient usage.”
“MBC reiterates its confidence in public-private partnerships in general and, in particular, the privatization of Manila’s water system, which is considered a model around the world. Our members suffered with the rest of public, from the shortage of water in our homes and our businesses. But service is indisputably better than before privatization. We are confident in the resolve of the concessionaires and regulators to make all efforts to improve reliability in the months and years ahead.”
The club’s statement was one of two issued Monday by major business groups on the water crisis, after services started to fail in early March in the east zone of Metro Manila, the concession granted to Ayala-controlled Manila Water Co.
In a joint statement issued Monday and signed, among others, by the American Chamber of Commerce, Inc. (AmCham) and the Foundation for Economic Freedom, whose members consist of retired technocrats and economic managers, business groups said they “welcome and fully support the directive of President Duterte to solve the water service disruption in the east zone concession within 150 days.”
“Accordingly, we are encouraged and confident that these interim measures will adequately resolve the water shortage and bring relief to consumers in the shortest possible time,” they added.
The signatories to the statement also included the Asia Pacific Real Estate Association; Financial Executives Institute of the Philippines; the Institute of Corporate Directors; the Management Association of the Philippines; and the Philippine Institute of Certified Public Accountants.
The signatories also noted that the privatization model in the water sector remains a “good” scheme, citing the huge improvement from nearly two decades when the water services were privatized.
“The volume of water saved from leakage is said to be equivalent to the output of a dam such that the great expense in constructing one in the past to cover that same volume was rendered unnecessary. Happily, gone are the waterless days of old. In fact, this privatization is being regarded as a good model before the international community for others to emulate,” they said.
They also urged the government to secure a secondary water source to address the growing needs of Metro Manila and its surrounding areas.
“Many lessons can be learned from this unfortunate episode and, hopefully, they will be employed to further improve the service and avoid a recurrence in the future,” they added. — Janina C. Lim

Budget saga nearing conclusion; bill may be with Palace next week

By Charmaine A. Tadalan
Reporter
THE House of Representatives and the Senate plan to transmit the P3.757-trillion national budget to the Office of the President this week, as agreed during a Monday meeting intended to resolve the budget impasse.
“That’s the common agenda, that’s the bilateral objective — to have this 2019 National Budget sent to Malacañang for the President’s signature, the soonest possible time without any further delay,” Albay-1st district Rep. Edcel C. Lagman told reporters in a chance interview after the meeting.
“The dialogue is in progress. We’re going to meet again tomorrow night at 7:00 p.m. The Senate panel will have to talk with the Senate President. Hopefully, by tomorrow night, we can resolve the impasse. As long as we’re talking there’s light at the end of the tunnel,” he added, noting Senate President Vicente C. Sotto III was not at the meeting.
In a “last-ditch effort” to break the deadlock, the House on March 20 “physically retrieved” the printed copies of the national budget, signed by Speaker Gloria Macapagal-Arroyo, which were transmitted to the Senate on March 11.
House Appropriations Committee chair Rolando G. Andaya, Jr. of the 1st district of Camarines Sur said aside from agreeing to do away with a reenacted budget, the House contingent also explained the budget process to the Senate.
“There are no more contentious points. We had a very lively conversation. We were able to explain both our sides in a very conducive manner for understanding at hopefully, maybe tomorrow, we’ll be able to come to an agreement,” Mr. Andaya said in a chance interview on Monday.
On the issue of lump sum appropriations, he said: “We explained to each other the history of what we did. There was some re-visiting of practices (from similar situations) in 1987,” he said.
The lump sums underwent a process of “itemization” by members of the House after the bicameral conference committee ratified the document, which became a point of contention between both chambers. The Senate is insisting on the version agreed by its representatives in bicameral session, while the House claims the itemization of lump sums minimizes corruption.
Also present during the meeting were San Juan Rep. Ronaldo B. Zamora and Senators Panfilo M. Lacson and Loren B. Legarda. The latter chairs the Finance committee. Mr. Andaya noted that Mr. Lagman and Mr. Zamora were chosen for the chamber’s three-man team for their experience in budget legislation.
He said the panel hopes to transmit the budget to President Rodrigo R. Duterte “before the 29th.”
The Executive branch, meanwhile, was also represented at the meeting by the Department of Budget and Management. “We were with the DBM earlier and we were asking for their opinion about the best time to pass the Budget and they said we need to take advantage of the good weather window (for construction),” Mr. Andaya said.
The Senate has alleged that the House realigned parts of the budget of the Department of Public Works and Highways and the Department of Health, amounting to P79 billion and P15 billion, respectively, after the Feb. 8 ratification.
Mr. Andaya said the Senate also made P75 billion in “post-bicam realignments.”
The budget impasse has resulted in the reenactment of the budget for the first quarter of 2019, which prompted the Development Budget Coordination Committee to slash its growth forecast for 2019 gross domestic product (GDP) to 6-7% from 7-8%. The National Economic and Development Authority, meanwhile, said GDP growth will decline to 6.1-6.3% if the budget is reenacted until April and 4.9-5.1% if until August.

SSS angling for new contribution hikes to fund maternity benefits

THE Social Security System (SSS) said the net impact of expanded maternity benefits will subtract a year from its actuarial fund life, and proposed a new round of hikes in member contribution rates to fund its increased commitments.
In a news conference on Monday, the pension fund said fund life is now estimated to run to 2044 if SSS pays out expanded maternity benefits under the new law if it does not access new sources of funding.
“Without funding, if the social security fund absorbs the cost, it… will shorten our fund life by one more year, so we’re now at 2044,” SSS Senior Vice President and Chief Actuary Edgar B. Cruz said on Monday.
He added that the fund will have to disburse P13.5 billion during the first year of implementation of the expanded maternity benefits, more than double the P6 billion allotted in previous years.
Republic Act (RA) No. 11210 or the Expanded Maternity Leave (EML) Law was signed by President Rodrigo R. Duterte in February, increasing paid maternity leave to 105 days from the current 60 days.
Under the new law, qualified members will receive P70,000 worth of maternity benefits regardless of the means of the child’s delivery, from the previous P32,000 for normal delivery.
Aurora C. Ignacio, SSS officer-in-charge, said the fund is “hopeful” it will be allowed to increase contributions rates again beyond the latest round of adjustments hiking member contributions.
“What we hope for after the number of years that we will be allowed to give the one [percentage point increase] every other year is to increase to cover the maternity benefits,” Ms. Ignacio said. “We were also allowed to do actuarial evaluation every three years. For now, we will try to cover with whatever we have.”
She added that the SSS can conduct an actuarial study earlier than the scheduled one in 2021 to determine whether the pension fund should increase contributions to fund the additional benefits.
According to its estimates, the pension fund will have to increase contributions by half a percentage point to cover for the expanded maternity benefits.
“We can’t increase benefits without a corresponding increase in contributions. If we don’t the fund life will suffer,” Mr. Cruz said.
RA No. 11199 or the Social Security Act of 2018 was signed by Mr. Duterte on Feb. 7, allowing the Social Security Commission or the policy-making body of the SSS to increase the contribution rate without the approval of the president.
The contribution rate will be increased by a percentage point starting April to 12%, until it hits 15% by 2025, from the current 11%.
It also gradually raises the minimum and maximum monthly salary credits (MSC) every other year starting next month at P2,000 and P20,000, respectively, to P5,000 and P35,000 by 2025, from P1,000 and P16,000 currently.
The increased contribution rate and MSC are expected to increase the actuarial life of the SSS to 2045 from 2032.
Voltaire P. Agas, SSS senior vice president and chief legal counsel, said the implementing rules and regulations (IRR) of the EML Law are being drafted by the SSS together with the Department of Labor and Employment.
“We hope they can provide the IRR by Labor Day,” he said. — Karl Angelo N. Vidal

Palace: Normal to pledge resources in China loan, default unlikely

MALACAÑANG said on Monday that many features of a loan agreement with China to fund the P3.6-billion Chico River Pump Irrigation Project were “standard” for such deals, including the pledge of Philippine natural resources as security for the loan.
Nevertheless, it expressed confidence that the security will never be foreclosed on because the Philippines is unlikely to default on the loan.
The President’s Spokesperson Salvador S. Panelo made the statement at a news conference Monday after Supreme Court Senior Associate Justice Antonio T. Carpio aired concerns about the loan security.
Mr. Carpio has said, citing the agreement, that if the government defaults on its loan, China can seize Philippine assets in the disputed West Philippine Sea, including the gas and oil-rich Reed Bank.
“The onerous conditions that some are saying incorporated in the contract is a standard between the lender and the borrower,” Mr. Panelo said when asked about the use of natural resources as collateral.
Mr. Panelo said there was “nothing wrong” with using the country’s natural resources as collateral.
“I don’t see anything wrong because I know it will never happen. That is precisely why I am saying that perhaps the economic managers who entered into a contract know that it will never happen,” he said.
“Just like bank institutions when they lend they impose terms to make sure na mababayaran sila (that they will be paid). Eh siguro itong mga pumasok diyan, mga (Maybe when they agreed to the loan) economic managers (thought that default) never namang mangyayari (will never happen), kaya binigay nila, (which is why they agreed to the terms).”
He said that the Philippines is “known for paying its loans.”
“Number one, bakit naman tayo magde-default? (why will we default?) We never defaulted on any obligations to any international organization with respect to loans of our country,” he said.
Mr. Panelo also reiterated that the Philippine government “cannot do anything” about China’s moves in the West Philippine Sea.
“We can only protest like any other (claimant) country, like Vietnam and others… You want us to declare war against them?” he said following reports that Filipino fishermen have been harassed in the West Philippine Sea.
Mr. Panelo added that the government will not go along with China’s treatment of fishermen. “If there is a violation, then we will have to go back to them (and point out violations),” he said.
Mr. Panelo also questioned the filing of a complaint by former Foreign Affairs Secretary Albert F. del Rosario and former Ombudsman Conchita Carpio-Morales against Chinese President Xi Jinping and other officials before the International Criminal Court (ICC) for “crimes against humanity” allegedly committed in the West Philippine Sea.
He said Mr. Del Rosario “did not make noise while he was in office, but is now acting when he is out of power.”
On Ms. Carpio-Morales’ involvement, Mr. Panelo said: “I have no problems with her. She filed it out of righteous indignation.” — Arjay L. Balinbin

Hanjin ex-workers march to DoLE to seek dialogue over benefits

THE PAYMENT of separation benefits to workers of Hanjin Heavy Industries and Construction Corp. Philippines (HHIC-Phil) may have been clouded by the workers’ expectations of remaining employed by the failed shipyard, with the Labor department expressing doubt that the remaining workers can obtain relief.
The former shipyard workers staged protests at the Department of Labor and Employment (DoLE) seeking a tripartite dialogue involving DoLE and the shipyard’s receiver, which DoLE said it was willing to support though it was less certain of the outcome.
In an interview with BusinessWorld on Monday, Samahan ng Manggagawa sa Hanjin Shipyard (SAMAHAN) President Efran Vinluan said that the tripartite dialogue should include the rehabilitation receiver, Rosario S. Bernaldo.
“Gusto namin na mag-file kami para sa tripartite dialogue kasama ang receiver, ang Hanjin, at ang DoLE na kailangan na maitawad kami (We want to initiate a tripartite dialogue with the receiver, Hanjin, and DoLE),” Mr. Vinluan said.
Hanjin continues to employ 53 workers as a skeleton crew for the shipyard. Last month, HHIC-Phil laid off more than 3,000 of its workers after defaulting on its loans to Philippine banks, leaving 312.
Mr. Vinluan said that out of the 312, 113 were “locked out” because they refused the voluntary retrenchment program. He added that the company was not able to give the remaining 53 benefits, such as separation pay, which was earlier committed to by DoLE during a previous dialogue.
DoLE Undersecretary Benjo Santos M. Benavidez said that the Labor department is open to dialogue but there is not much that the dialogue can do.
“The question is what is there to discuss?” Mr. Benavidez said in an interview with BusinessWorld on Monday.
He added: “It was not Hanjin that offered the voluntary retrenchment. It was the contractors.”
The remaining and laid-off workers are formally employed by 17 contractors. HHIC-Phil’s general contractor, Subic Shipbuilder Corp. (SUSHICOR), committed to pay its workers separation pay and other benefits.
Mr. Benavidez said that the remaining workers refused to receive their benefits because they did not want to apply for the voluntary retrenchment program. The Labor department is monitoring the payments by the contractors, with Mr. Benavidez saying most workers have been paid.
“The Secretary of Labor (Silvestre H. Bello III) pledged that we will facilitate the separation pay (but the workers don’t want to take it) because they want to return to Hanjin). They are questioning the retrenchment,” he said.
He said if these workers are challenging the legality of the program, the matter is beyond the mandate of DoLE.
The proper venue, he said, is the National Labor Relations Commission (NLRC), where an arbiter will determine what action can be taken.
He said: “If (the workers) are questioning the legality of the retrenchment, then (the workers should) file a case.” — Gillian M. Cortez

First shipment of mangoes to Russia seen next month

THE Department of Agriculture (DA) is expecting to export mangoes to Russia starting next month Secretary Emmanuel F. Piñol said on Monday.
“Philippine Ambassador to the Russian Federation Carlos D. Sorreta said that he has been working on the shipment of mangoes to Russia for the last two years only to be told that there is not enough supply of the Guimaras variety,” Mr. Piñol said in a social media post.
“I was informed that the harvest has started and that an initial shipment can be made by the first week of April,” Mr. Piñol added.
Mr. Piñol, who was visiting Russia, said he was able to inspect a store which sold mangoes from Thailand, India and Pakistan for the equivalent of P1,000 each.
“I was shocked to discover that huge mango which is not even half as sweet as the Philippine mango was sold for P1,000,” Mr. Piñol said.
“The entry of the Philippine mango into the Russian and Belarusian markets can radically change the preferences of consumers in Eastern Europe,” he added.
Mr. Piñol said that while Guimaras mangoes will remain on the premium end of the market, the DA also aims to market other mangoes from the Philippines with labels of origin.
The other areas supplying mangoes are Zambales, Pangasinan, Cebu, Iloilo, the Davao Region, and Cotabato. — Reicelene Joy N. Ignacio

NEDA: March inflation estimate is ‘same or lower’ compared with February’s 3.8%

THE National Economic Development Authority (NEDA) said it expects inflation in March to be lower or level with February’s.
“We’re expecting it (to be) either the same or lower,” Assistant Secretary for NEDA’s Regional Development Office Mercedita A. Sombilla said in a news conference on Monday when asked for the agency’s estimate for inflation this month.
In February, inflation was 3.8%, unchanged from a year earlier and down from 4.4% in January.
NEDA’s March projection hinges on the continued of oil prices and rice, according to Ms. Sombilla.
She said the estimates also factor in the effects of the El Niño, which the economic planners assume will have “a very minimal” effect, particularly on rice production.
According to the Department of Agriculture’s Disaster Risk Reduction and Management Operations Center, damage inflicted by El Niño on farms totaled P1.33 billion as of March 19, covering 78,348 metric tons (MT) of output.
Losses to the rice crop totaled 41,003 MT, worth P814.40 million.
Ms. Sombilla also said traders may soon import rice to further shore up domestic supply if the El Niño threat intensifies, with the Rice Tariffication Law’s implementing rules and regulations up for signing within the week.
In addition, rice stocks built up before the Rice Tariffication Law kicked in are still available to keep supply stable, Ms. Sombilla said.
According to the National Food Authority, the inventory of rice, including approved orders from Dec. 20, 2018 to March 5, totaled 357,816.45 metric tons.
Despite prices of the staple grain being steady, NEDA said it “remains vigilant” on other commodities such as corn which has also been “slightly” affected by El Niño.
The government forecasts inflation in 2019 to average within the 2 to 4% range. — Janina C. Lim

NGCP activates Bataan-Pampanga transmission line

PRIVATELY OWNED National Grid Corp. of the Philippines (NGCP) has energized its P316-million Hermosa-Floridablanca 69-kilovolt (kV) transmission line to bring more reliable services to customers in Pampanga.
The project is among the list of projects that the Department of Energy (DoE) certified as being of national significance in January. It was energized on Feb. 28 and will ease the load of the existing and aging Hermosa-Guagua 69kV line, the company said.
“Due to the load growth in the area, the 53-year-old existing line cannot accommodate the heavy loading conditions and would have caused problems in the long run,” NGCP said in a statement. “A new line was required to ensure the reliability of power transmission services.”
NGCP said the project complies with the “N-1 component” set by the Philippine Grid Code, referring to the ability of the grid to withstand a major disturbance with minimal disruption to the system.
It said with the new line in place, the grid operator will also be able improve services to the franchise area of the Pampanga II Electric Cooperative.
It added that apart from the Hermosa-Floridablanca transmission line, the company is working on reliability projects such as the western Luzon 500-kV backbone project.
NGCP said it will also install a new transmission corridor, the Bataan 230-kV reinforcement project, which will serve power customers in Bataan and nearby provinces and accommodate incoming generating capacity. It will also put up the Nagsaag-Tumana 69-kV transmission line project, which will serve customers in Pangasinan.
“We continue to appeal for support from our stakeholders in the smooth implementation of our projects, which will ultimately benefit all power consumers not only in Luzon, but in the entire country,” NGCP said.
A certificate that an energy project is of national significance, known as a CEPNS, entitles project proponents to all the rights and privileges provided for under Executive Order 30 series of 2017, including action on the application within 30 working days.
Certified projects also enjoy presumption of prior approval — they are presumed to have already complied with the requirements and permits from other government permitting agencies.
It will be deemed approved if no action is taken five days after the lapse of the 30 working-day period for processing of the application. — Victor V. Saulon

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