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Philippine STAR forum to discuss challenges facing female innovators

WOMEN OF TODAY hold numerous roles: mother, citizen, entrepreneur, professional, creator, muse, among others.

They also hold a lot of power and potential within themselves that, when unleashed, become the source of strength that keeps society together into the future.

The Philippine STAR, in partnership with Globe Telecom and Women Influence Community Forum, brings the Women Influence Forum to Manila with the theme: “Women Today: Innovators and Agents of the Future.”

The forum will gather the country’s most influential women and decode how they effectively carry out their roles in society.

The forum will raise issues that hinders women empowerment, contributing to the push for gender equality.

Main keynote speaker of the forum is Anna Belova, chairman of the board for JSC Russian Venture Co. and dean of the National University of Higher School of Economy.

Session keynote speakers include Vice-President Maria Leonor G. Robredo; Senator Grace Poe; Leyte Fourth District Rep. Lucy Torres-Gomez; Nina D. Aguas, Insular Life executive chairman; Chef Margarita Forés; and Jeannie E. Javelosa, co-founder of Great Women Org Philippines.

Forum panelists include some of the biggest names in business, politics, journalism and the arts, such as Quezon City Mayor Ma. Josefina G. Belmonte-Alimurung, Manila Mayor Francisco “Isko” M. Domagoso, Ormoc City Mayor Richard I. Gomez, 1973 Miss Universe Margarita Moran-Floirendo, The Philippine STAR Lifestyle editor Millet M. Mananquil, broadcast journalist Karen Davila, Dr. Victoria “Vicki” Belo-Kho, Ballet Manila’s Lisa Macuja-Elizalde, Cignal TV president and Chief Executive Officer Jane J. Basas and Honorary Consul to Russia Armi Lopez Garcia to name a few.

The forum will be held at the Manila Ballroom of the Manila Marriot Hotel in Pasay City on Nov. 12.

For more information of the forum, visit womentoday.philstarlife.com.

The Philippines improves in shipping connectivity scorecard, among biggest in tonnage

The Philippines improves in shipping connectivity scorecard, among biggest in tonnage

Kia gets in subcompact SUV ring via Seltos

Text and photos by Kap Maceda Aguila

FOLLOWING its world premiere in July, Korean global car maker Kia lost no time in making the subcompact crossover Seltos available to customers in the Philippines — who also have the honor of getting it first in the ASEAN region. And the vehicle comes in with rightfully much optimism from executives.

“We received huge attention from media, customers and even competitors globally,” said Kia Motors Asia Pacific President Ted Lee in a speech at the launch last Wednesday in Taguig City. “In the Korean market, the Seltos has been a top-selling model in B-SUV segment with sales volumes much higher than the next model in the segment. In India, where Kia was not present until last July, the Seltos has received, despite the market’s slowdown, more than expected inquiries and customer bookings.”

Meanwhile, Kia Philippines President Manny Aligada reminded how the Seltos represents a fulfillment of the promise made late last year during a press conference to announce the operational takeover of the Ayala Group.

“On January 30, we launched the partnership between Ayala and Kia motors, and (opened) the first of the three boxes, which (held) the Soluto. Now, (it) is the biggest-selling model in the Kia lineup,” he said. Kia followed suit with the debut of the Stinger sports sedan at summer’s Manila International Auto Show. Now the brand closes the year strong with the Seltos.

“We said we would bring back the glory of the brand that is so known worldwide, and we committed to two things. First, we said we would enhance the current lineup, which we did. The second is that we would bring in three new models,” averred Mr. Aligada.

The Seltos, named after the son of Hercules in Greek mythology (with the “C” supplanted with an “S” to represent sportiness), effectively becomes Kia’s entry-level SUV crossover. It measures 4,370 x 1,800 x 1,615 millimeters, with a wheelbase that stretches 2,630mm. Mr. Aligada asserted that it is larger compared to segment competition, and approaches the dimensions of more upmarket SUVs. Even the cabin, he continued, boasts generous headroom and rear legroom.

Under the hood is a 2.0-liter inline-four DOHC D-CVVT Atkinson Cycle engine mated to an all-new Intelligent Variable Transmission (IVT) developed by Kia to produce “power, response, smoothness, and fuel economy. The IVT features continuous gear shifts for improved drivability,” according to a release.

Proprietary Advanced High Strength Steel promises “enhanced body rigidity and maximum occupant security.” A Drive Mode Select system lets drivers choose from Normal, Eco, or Sport for more customized response expectations. A rear-view camera with rear-view driving function affords heightened confidence and safety.

In an exclusive interview with Velocity, Mr. Aligada revealed that the Seltos sold around 6,000 units in one month in India, where it was unveiled even before it’s hometown Korea. He attributes the popularity of the SUV there with the fact that the market “had a strong say in the design of this” — particularly in the areas of size, setup, and engine. That and “detailed attention in the design made it stand out.”

This, predicted the executive, augurs well for the Seltos reception here. “Similarly in the Philippines, which is an SUV country, this is what will (help) the Seltos become one of the leading models. (It’s a) small, tall, compact SUV. There’s the two-liter petrol engine that’s powerful and efficient, and the IVT, plus the look. Filipinos will surely appreciate this.”

Kia Philippines sources the Seltos directly from Korea, and offers buyers a standard five-year, 160,000-kilometer warranty. Until November 30, the company also extends a P50,000 discount on all three variants of the Seltos. Inclusive of the discount, the prices are: LX (P1.048 million), the EX (P1.148 million), and the SX (P1.448 million).

“The direction we’re taking now is that we get models that will play in good positioning — perfect for branding because that’s what we need now. We have the Sorento, the GT line for Sportage and Forte, and then the Stinger. We also have players in the volume segments — the K2500, the Soluto. We’re working on the other models. This one is also a sweet spot, a huge segment with 12 to 15 percent of the total industry. So, we’re bringing in models that should have a good play both in volume and in branding,” concluded Mr. Aligada.

Peugeot 5008 gets upgrades, keeps old price

Text and photos by Kap Maceda Aguila

DESPITE getting a slew of upgrades, the 2020 version of the Peugeot 5008 seven-seater SUV will still be priced at P2.19 million.

Peugeot Philippines recently unveiled the vehicle at its Pasig City dealership. Though not a new model, the lone Allure variant of the 5008 showcases a number of upgrades and improvements. In a speech, Peugeot Philippines Business Development Director Dong Magsajo said these changes should “(take) the ownership experience to the next level.” He added, “Already boasting of advanced features that put many an SUV to shame, we are proud to announce that we’ve listened to our customers and packed our seven-seater with even more features.”

In response to customer feedback, the French car maker brings back the 5008’s panoramic sunroof. “We first made this available all the way back in 2013. The glass roof enhances the interior ambience as it gives the 5008 owners the option for more lighting inside the vehicle,” shared Mr. Magsajo. Speaking of which, the cabin is bestowed with ambient LED lighting, as well as Claudia leather-wrapped seats. The 5008 is now also equipped with an automatic tailgate with foot sensor for hands-free operation.

Peugeot’s Advanced Driver Assistance System (ADAS) also makes its debut on the 5008 Allure. “While the 5008 has always had a five-star Euro NCAP crash rating, ADAS will give the (present-model) owner several safety systems not normally found in other vehicles,” the executive explained.

The suite of safety measures includes Active Blind Spot Detection, advanced driver attention alerts, Lane Keeping Assist, and a speed limiter and cruise control feature with intelligent speed adaptation.

The 5008 still has Advanced Grip Control which, added Mr. Magsajo, “ensures 4×4 capability without the added weight.” The vehicle’s infotainment system also features Apple CarPlay connectivity for easy smartphone integration.

New 18-inch Detroit alloy wheels complete the new package. “At this price point, the 2020 Peugeot 5008 SUV has the best combination of premium features and impressive technologies in a vehicle available in the market today,” said Peugeot Philippines Sales Director Dodie Gañac.

The vehicle is still powered by a 1.6-liter twin-scroll turbo petrol engine delivering 165hp (at 6,000rpm) and 240Nm (at 1,400rpm).

The 2020 Peugeot 5008 Allure is now available in select Peugeot dealerships nationwide. The current price is actually a full P1 million less than the France-sourced 5008. The price reduction is made possible by the fact that Peugeot Philippines now imports its CBU units from a Peugeot production facility in Penang, Malaysia, so the company also is able to leverage AFTA (ASEAN Free Trade Area) relief. Mr. Magsajo revealed that the Penang factory is owned by Peugeot.

For particulars, e-mail info@peugeot.ph or visit www.peugeot.ph. The company’s official Facebook page is PeugeotPhilippines.

Toyota strengthens Vios midrange with new XLE

By Manny N. de los Reyes

THE PRODUCT planning staff of Toyota Motor Philippines (TMP) must be incredibly busy. Not only does the market leader purvey a staggering 18 models in its local lineup, its best-selling model, the locally made Vios, has no less than 10 variants.

And now, Toyota has seen fit to make it 11.

Say hello to the new Vios XLE. Price-wise, it slots just above the Vios Base, Vios J, and Vios XE and just below the Vios E, Vios G, and Vios G Prime — putting the XLE right smack in the middle of the expansive Vios family.

Like most of its variant siblings (except the Vios G models, which have 1.5-liter engines), the Vios XLE comes with a 1.3-liter engine mated to either a 5-speed manual (P791,000) or a CVT (P841,000).

Toyota is offering the new Vios XLE with bundle offers worth as much as P100,000, as well as more vehicle customization and payment options.

Retail sales began over last weekend, Nov. 8-9, at the Vios XLEnt Weekend Launch in all 70 Toyota dealerships nationwide. Interested customers may reserve through the official web site link: bit.ly/ViosXLE.

The Vios XLE is designed as a value-for-money variant that offers the best possible Vios specs at an affordable price point. It comes with driver, passenger, and knee air bags, 4-beam halogen headlamps, 15-inch alloy wheels, and a 7-inch touchscreen display audio with WebLink for iOS/Android. The Vios XLE is also equipped with power door locks, power side view mirrors, and the standard Vehicle Stability Control plus Hill Start Assist.

“Toyota is introducing the Vios XLE to give our customers the freedom of choice on how they want to purchase and modify their car,” said TMP First Vice-President Cristina Arevalo. “This new variant combines affordability and style without sacrificing the everyday practicality that the Vios has always been known for. We call this the XLE Advantage.”

The XLE Advantage offers prospective car buyers two attractive bundles: Option A is an outright cash discount of P35,000 plus accessory options worth P40,000; while Option B is the sought-after Zero Downpayment financing scheme. Both options come with the 5-year Extended Warranty and free Preventive Maintenance Service (PMS) up to 20,000kms to further make the Toyota car ownership experience more affordable.

For the P40,000 worth of accessory options, customers can choose to modify their Vios units with an array of exciting interior and exterior add-ons. They can mix and match Vios accessory packages, including but not limited to, Daytime Running Lights (DRL), LED fog lamps, reversing camera, aero kits, and select TRD pieces with 17-inch alloy wheels.

The current Vios lineup and pricing is as follows:

TOYOTA VIOS

1.5 G Prime CVT P1,098,000

1.5 G CVT P1,043,000

1.5 G M/T P984,000

1.3 E Prime CVT P936,000

1.3 E CVT P881,000

1.3 E M/T P831,000

1.3 XLE CVT P841,000

1.3 XLE M/T P791,000

1.3 XE CVT P738,000

1.3 J M/T P688,000

1.3 Base MT P662,000

Head to any of Toyota’s 70 dealerships nationwide to know more about the new Vios XLE and avail special deals on other Vios variants. For the latest Toyota news and information, visit TMP’s official web site at www.toyota.com.ph and follow the official Facebook page at www.fb.com/ToyotaMotorPhilippines.

AboitizPower finalizing sale of biomass plant

ABOITIZ Power Corp. expects to finalize this month the sale of the 8.8-megawatt (MW) biomass power plant in Lian, Batangas under subsidiary Aseagas Corp., which the listed company wrote off for P3.7 billion early last year.

“May mga plant visits na (There had been plant visits). They received a number of letters of intent,” Emmanuel V. Rubio, AboitizPower chief operating officer, told reporters when asked about the status of the sale.

“I think there’s a deadline. I think late November for people to make offers on those assets,” he added, referring to the advice of an independent entity handling the sale of the plant. “We’re not the one doing the process.”

Asked whether Aseagas has finally attracted interested buyers, he said: “Of course.”

Last year, Mr. Rubio said he was in talks with two interested parties — one local and one foreign. He also said that the foreign entity might partner with a local company. He had expected the transaction to be completed by end-2018.

In December 2017, AboitizPower said the plant had temporarily ceased operations because of the unavailability of organic effluent wastewater from its supplier Absolut Distillers, Inc. for conversion into clean and renewable energy.

In January 2018, the company announced that it would be permanently stopping the operations of the biomass power plant because of the lack of organic materials to produce electricity. It said its top consideration was to balance the interests of stakeholders, including those of Aseagas’ employees.

At that time, the total value affected as a result of the plant’s closure included Aseagas’ invested equity of P3.45 billion and the company’s estimated remaining obligations of around P250 million.

AboitizPower acquired the biomass plant in July 2016, building up its renewable energy footprint, which covers large hydro, run-of-river hydro, geothermal and solar.

The deal was through Aboitiz Renewables, Inc., the listed company’s holding firm that houses its investments in renewable energy. AboitizPower acquired the Aseagas facility from parent firm Aboitiz Equity Ventures, Inc.

The acquisition, which marked AboitizPower’s entry into biomass technology, followed the company’s foray into solar power with the inauguration in April 2016 of San Carlos Sun Power, Inc.’s 59-MWpeak solar power plant in Negros Occidental.

The biomass plant had been expected to start operating and delivering power to the Luzon grid before October 2016. It was supposed to power about 22,000 households while producing 33 tons per day of liquid carbon dioxide for the industrial and beverage industries. — Victor V. Saulon

The seduction of Natori

MULTICULTURALISM and luxury, as well as a two new lines for an experienced master were the focus of Josie Natori’s launch last week in Rustan’s.

Ms. Natori was born as Josephina Almeda Cruz in the Philippines, but moved to New York as a teen to study economics at Manhattanville College. In New York, Ms. Natori went up the ranks and became the first female Vice-President of investment banking by the 1970s — not an easy feat. Either way, she left it all in the space of nine years. She told BusinessWorld during her launch in Rustan’s Makati, “I was bored in Wall Street.”

“I wanted something and not realizing that I was missing the creative part,” she said, pointing to her past as a pianist. “I look at it as a business, but fortunately, it has allowed me also to express.”

For this season’s collection, did Ms. Natori express. Rich embroidery and expressive prints evoking images of Morocco and Japan were on display on the racks, which expensively dressed women riffled through.

Just this month, she said, she launched her Natori line, a more casual, everyday collection (think of it as her diffusion line) in simpler monochrome.

In another area, Ms. Natori has also licensed her name to a line of fine jewelry, proudly showing off a pair of earrings made up of a blackened silver dragon wrapped around a single enormous white topaz. That line is still in New York, and are yet to make an appearance in Manila.

Talking about her longevity and sustained energy in the industry (she counts 42 years in the business), she said, “We work very hard. We have a wonderful team. It’s not an easy business, but you have to keep giving something different.”

“You have to seduce them every season.”

Speaking of seduction, one of Ms. Natori’s specialties, and in fact, what made her name famous in the first place, was her lingerie line. “At the time, lingerie was either lewd or frumpy,” she said in her website. What she did was make lingerie elegant but expressive, using clean, flowing lines but in bold colors and prints. Think about it: how many people will see you in your state of undress anyway? But that’s what makes it a true luxury: a woman wears Natori lingerie not because she has something to say, but because she has already said it, and is taking a break.

“That’s the ultimate luxury,” she told BusinessWorld. “Feeling good, feeling comfortable, and feeling beautiful. Right?” — Joseph L. Garcia

Iloilo mountain coffee growers among province’s top producers

By Emme Rose S. Santiagudo
Correspondent

ILOILO CITY — In the forests of the remote mountain village of Nagpana in Iloilo province, coffee shrubs have long been growing wild in abundance.

But the Ati indigenous community that lived there was not aware that it was a high-value crop.

“Our farmers did not know what type of plants grew in our forest lands until it was discovered that it was coffee,” according to Grace E. Eno, a member of the community and treasurer of the Nagpana Minority Association (NAMIAS), which produces the Kape Miro brand.

“We believe that it was the Asian Palm Civet that brought coffee to our farms, that is why we named it Kape Miro,” she said, referring to the civet’s name in the local dialect.

The traditional form of civet coffee involves farmed civets who are fed coffee cherries, which they partially digest, producing beans, which are then processed like regular coffee. Within the industry, partially-digested coffee beans are considered a novelty while the farming of civets has raised ethical concerns.

Before NAMIAS was formed, Ms. Eno said her father and others of his generation started coffee farming, but had no steady market.

“We used to sell it in the streets and in the markets,” Ms. Eno said.

The farmers eventually received assistance from the non-government organization Taytay Sa Kauswagan, Inc. (TSKI), and the Department of Science and Technology (DoST) and Tearfund New Zealand.

By 2013, the Ati community had its own coffee processing facility.

In November of that year, however, super typhoon Yolanda struck the Visayas, damaging their coffee plantation, the facility, and their homes.

But the Atis quickly got back on their feet, and in 2015 they opened a new processing facility, again with support from TSKI, DoST and Tearfund NZ, plus the municipal government of Barotac Viejo, and more government agencies.

“TSKI, DoST, Department of Trade and Industry (DTI) and other agencies (like the Department of Labor and Employment) came in to help us with the production facility. They really helped us by providing us machines and they were the ones who identified our potential buyers,” Ms. Eno said.

The production process again received support in 2017 through DoST’s Community Empowerment through Science and Technology (CEST) program.

Now, Ms. Eno said, they have all the machines for the entire production process, including a dehuller, roasting machine, and sealer.

“We have a complete coffee production so we are the ones who pack the products and deliver it to our buyers,” she said.

One of their main buyers and distribution channels is Tinukib Cafe and Souvenirs in Iloilo City, a cultural venue managed by TSKI’s Tinukib Foundation, Inc. It is located inside the Casa Gamboa heritage house.

Almost everyone in the Ati community is involved in the coffee enterprise, but Ms. Eno said some of the women have maintained the weaving tradition or ventured into making jewelry, purses and other souvenir items.

The success of NAMIAS and Kape Miro received recognition last month during DoST Regional Science Week, where they were awarded the Regional Best Community and Best CEST Project for 2019.

Ms. Eno, who received the award in behalf of NAMIAS, said the association is proud to have become one of the biggest coffee producers in Iloilo and hopes that other indigenous communities will be inspired by their work.

Nissan employees paint Habitat for Humanity community homes in Tanza, Navotas

IN ITS COMMITMENT to enriching people’s lives, employees of Nissan Philippines participated in an outreach activity in partnership with Habitat for Humanity Philippines.

For the past seven years, Nissan has helped more than 3,300 families through the partnership, with Nissan Philippines employees, contributing more than 316 volunteer hours. The latest in a seven-year partnership involved helping the local residents by painting the houses of Habitat for Humanity’s partner-community in Tanza, Navotas.

Forty employees, led by Nissan Philippines’ President and Managing Director Atsushi Najima, volunteered to complete the painting of a total of five houses.

“Our volunteer work with Habitat for Humanity Philippines is an extension of our company’s vision by moving people to a safe, sustainable, and inclusive world. We aim to enrich the lives of Filipino people as a natural part of our operations, and through community service,” Mr. Najima said.

Nissan’s partnership with Habitat for Humanity started in 2012 with the disaster response and shelter repairs in the wake of Typhoon Pablo (International code: Bopha). The partnership continued to include projects such as employee volunteer programs, disaster risk reduction and mitigation projects, and youth leadership training. Nissan also donated a total of four vehicles — Nissan X-Trail, Nissan Urvan, and two Nissan Navara — as part of the disaster response objectives.

Vista Land Q3 profit jumps 13%

VISTA LAND & Lifescapes, Inc. expanded its earnings by 13% in the third quarter, as its real estate sales continued to grow.

The Villar-led property developer posted a P3.16-billion attributable net income in the July to September period, from P2.87 billion a year ago.

Consolidated revenues climbed 7% to P10.96 billion as expenses rose 12% to P6.98 billion during the same three months.

Broken down, real estate sales went up 3% to P8.19 billion, while rental income slipped 4% to P1.59 billion. Interest income surged 92% to P663 million. Miscellaneous income, which refers to “forfeited reservation fees and partial payments from customers whose sales contracts are cancelled before completion of required down payment,” soared 60% to P529 million

Year to date, the company’s attributable net income stood at P8.83 billion, up 12% from last year.

This was driven by a 9% growth in consolidated revenues to P34.36 billion. Leasing revenues increased 13% to P5.8 billion during the nine-month period. Reservation sales also grew 8% to P61.6 billion, coming mostly from overseas Filipino workers.

Expenses in the nine months jumped 12% to P21.13 billion.

“We are well-poised to achieve another record year this 2019 as Vista Land continues to deliver solid performance both from our leasing and residential businesses,” Vista Land Chairman Manuel B. Villar, Jr. said in a statement over the weekend.

“As what we have said in the past two quarters, we remain bullish for the industry, given the sustained demand for our housing products as well as our success in our leasing business propelled by the steady growth in the disposable income, Overseas Filipino remittances, sound Philippine macroeconomic fundamentals and the government’s drive to accelerate economic activities and infrastructure developments outside Metro Manila, where we have a competitive advantage given that we have the widest geographic reach around the country,” he added.

Vista Land President and Chief Executive Officer Manuel Paolo A. Villar also noted the company is motivated by the strong growth of its existing investment properties of more than 1.4 million square meters.

“We remain confident about the company’s prospects for the rest of the year as our leasing portfolio will be growing which complements our existing core and stable end-user housing business,” he was quoted as saying. — Denise A. Valdez

China’s sneakerheads chase 6,600% returns flipping Air Jordans

ONE OF THE hottest commodities in China right now is a pair of sneakers.

The SoleFly x Air Jordan 1 in black patent leather rocketed in value by 6,600% to a high of 75,999 yuan ($10,730) on the online marketplace Nice after its release in December. Only 223 pairs of Nike Inc.’s retro high-top were made for sale, according to online magazine Sneaker Files.

The model is among the most profitable sneakers traded on the exchange created by Beijing-based Nice App Mobile Technology Co. Such outsize returns are hard to come by, but they’ve nonetheless caught the attention of sneakerheads like Lei Xiaoming, 20, a mechanical engineering student in Huangshi.

Lei has collected limited-edition shoes for years but only started investing in them in April.

“Prices were surging so much I thought it would be a better choice to sell them rather than wear them,” he said. “It’s more exciting than trading stocks.”

Since then, he’s spent about 200,000 yuan buying more than 200 pairs — mostly Air Jordans and Adidas AG’s Yeezy line, a collaboration with rapper Kanye West. He’s earned profits of about 100,000 yuan by reselling some, he said.

Across China, more than 10 million monthly active users frequent online-resale apps, such as Poizon, Nice, and DoNew, according to Chinese data-mining company QuestMobile. While many products suffer from the effects of the trade war, pairs of collectible sneakers are flying off the shelves, and that’s attracting the attention of US sneaker exchanges StockX and GOAT — as well as China’s central bank and state media.

‘CHINA WILL SOON BECOME THE SNEAKER CAPITAL OF THE WORLD’
Most of what’s traded on these platforms are basketball sneakers — a testament to China’s love of the sport, even as the NBA faces backlash for a Houston Rockets executive’s tweet appearing to support Hong Kong’s protests.

The buzz over shoe reselling made a unicorn out of Poizon, developed by Shanghai Shizhuang Information Technology Co. In April, funding from Digital Sky Technologies vaulted its valuation to $1 billion, according to CB Insights.

China’s sneaker-resale market exceeds $1 billion in value, said Scott Cutler, chief executive officer of Detroit-based sneaker exchange SoleTrade LLC, known as StockX.

Chinese investors long have speculated in alternative assets, including cryptocurrencies, fiery liquor from Kweichow Moutai Co., and garlic.

Now, sneakers have their attention. Unlike Chinese stocks, which only can move 10% in either direction, there’s no cap on shoe returns.

“As with all frothy assets, there’s no telling where the peak is,” said Yu Yingbo, investment director at Shenzhen Qianhai United Fortune Fund Management Co. “As long as there are high returns, there is going to be money chasing them.”

Sneaker collecting went mainstream in the US after Nike launched Air Jordans in the 1980s, and the trade went digital with eBay Inc. about a decade later.

Today’s technology makes the trade more sophisticated. Apps collect bid and ask prices, chart costs and volume in real time, and allow users to share investment advice. Some also let customers buy coupons that can be traded for shoes before coveted models arrive — in effect selling sneaker futures.

Now more-established trading sites in the US want a piece of the action in China.

StockX plans to introduce local payment and language support this year, said Cutler, previously the head of global listings at the New York Stock Exchange. China already comprises about 10% of StockX’s transaction volume.

Culver City, California-based 1661 Inc.’s GOAT launched a mini-app on WeChat in July after receiving $100 million in funding from Foot Locker Inc.

“China will soon become the sneaker capital of the world,” said Henek Lo, general manager of GOAT China. The demand from Chinese millennials is “something we haven’t seen anywhere else.”

Significant rewards typically are accompanied by significant risks, and sneaker trading is no different. Of more than 2,600 collectible models sold on Nice, 56% lost value, according to company data. Only 0.4% of footwear saw returns of more than 1,000% on the app.

But Tian Hao, 27, is convinced he’s cracked the code. These days, his 90-square-meter Beijing apartment mostly serves as storage space for his inventory, which he estimates to be worth hundreds of thousands of dollars.

There’s hardly any space to walk around in his living room, where hundreds of shoeboxes are stacked up on the sofa, TV console and coffee table.

As Tian runs low on space, he’s stashing sneakers with a friend. In return, Tian helped him invest 260,000 yuan in sneakers. After splitting the profits, they each cleared 90,000 yuan in two months.

“This is one of my luckiest investments this year,” Tian said. “My friend can’t stop admiring me.”

Operating in a country known for its copycats, Poizon and Nice say they have strict processes to ensure they’re selling authentic products. Poizon hires “hardcore master-level sneakerheads” to inspect every shoe, including packaging, labels, stitching, and glue, and it issues certificates to verified products.

“There are so many details — the material, the label, the box, etc. — it’s extremely hard for knock-offs to get it exactly right,” Nice CEO Alex Zhou said.

GOVERNMENT ATTENTION
Both Poizon and Nice offer guarantees against fakes, promising to compensate buyers at triple the value of their fraudulent purchases.

Lately, though, the Chinese apps are concerned about deflecting the government’s attention. It may be too late. An article published in June on state-run China Daily mentioned Poizon and StockX, calling out sneaker resellers for the “chaos” in surging prices.

And last month, the Shanghai branch of the People’s Bank of China warned the city’s financial institutions about the risks associated with sneaker speculation, according to people familiar with the matter. It said the resale platforms are a “financial game of hot potato.”

Adidas discourages the reselling of its sneakers, the company said. Nike did not respond to a request for comment.

Poizon has since spoken out against flipping shoes and in August stopped offering storage space that enabled traders to avoid taking deliveries.

“Shoes are for wearing, not for speculation,” said Charles Xing, the head of marketing.

Poizon CEO Yang Bing declined an interview request.

Nice also cautioned against the practice in a Sept. 27 WeChat post.

“Don’t embark on the unreturnable path of speculation for the greed of short-term profit,” Zhou said. “It’s going to harm others as well as yourself.”

The app suspended price charts, a leaderboard for price performance and discussions about investments.

Still, that’s not deterring resellers like Tian, who said he expects to continue trading for the next three to five years.

“The ‘chives’ who rush into this market may leave,” he said, using a nickname for bandwagon investors. “The sneaker lovers and collectors will be enough to nurture this resale industry.” — Bloomberg

T-bonds may fetch lower rates

THE RATES on reissued 10-year Treasury bonds (T-bond) on offer on Tuesday will likely decline amid easing inflation and as the market waits for updates on the US-China trade war.

The government is looking to raise P20 billion worth of reissued 10-year via the reissued T-bonds with a remaining life of nine years and two months and a coupon rate of 6.875%.

The yields on the securities are expected to fall within the 4.5-4.6% range, according to Michael L. Ricafort, economist at Rizal Commercial Banking Corp. (RCBC).

During the Aug. 13 auction, the Treasury borrowed P20 billion as planned via the 10-year papers as the offer attracted P65.2 billion in total bids. The papers fetched an average rate of 4.196%, 145 basis points (bp) lower than 5.644% quoted during the auction on May 28.

At the secondary market on Friday, the ten-year notes were quoted at 4.674% based on the PHP Bloomberg Valuation Service Reference Rates published on the Philippine Dealing System’s website.

“Market participants are closely watching any developments regarding the US-China trade spat and the possibility that domestic inflation could tiptoe higher in the coming months,” Robinsons Bank Corp. peso debt trader Kevin S. Palma said in a phone message over the weekend.

Last week, the Philippine Statistics Authority reported headline inflation slowed further to 0.8% in October from September’s print of 0.9% and the 6.7% a year ago. The PSA attributed this decline, which was the slowest in nearly three-and-a-half years, to the lower prices on heavily weighted food and non-alcoholic beverages, transportation and utilities.

Overseas, US President Donald Trump said over the weekend that negotiations on its trade dispute with China are moving “very nicely” but was firm on saying that it has to be a “great deal”.

Mr. Trump assured that China is also keen on closing in on a deal to put a stop to the prolonged war.

As part of the first phase of their deal, the two big economies had agreed to roll back tariffs that they imposed earlier.

Back home, Mr. Ricafort said the “major catalyst” for the auction will be the central bank’s move to reduce banks’ reserve requirement ratio (RRR) further which provided additional liquidity to the system.

“The RRR cuts for the first reserve week of November 2019 amounted to P125 billion, as additional supply of peso funds/liquidity into the financial system that could temper any upside on the auction yield,” he said in a phone message over the weekend.

The 100-bp cut announced in September took effect this month, bringing the reserve requirement ratios of universal and commercial banks to 15%, thrift banks to five percent, while that for rural banks now stands at three percent.

In October, the Bangko Sentral ng Pilipinas (BSP) announced another 100-bp reduction in the reserve ratios of universal, commercial and thrift banks by December, taking the overall reductions to their RRR to 400 bps for this year.

This cut will also apply to the reserve ratio of non-bank financial institutions with quasi-banking functions (NBQBs) to bring their RRR to 14% next month.

Meanwhile, the reserve ratio of universal and commercial lenders to 14% by December, while the RRR of thrift banks will stand at four percent.

Mr. Ricafort added that the recent appreciation of peso versus the greenback “would tend to support relatively lower local yield benchmarks as a stronger peso supports lower import prices and lower overall inflation.”

The government is planning to borrow P220 billion from the domestic market this quarter broken down into P100 billion in Treasury bills and P120 billion via T-bonds. It is looking to raise P1.189 trillion this year from local and foreign sources to fund its budget deficit, which is expected to widen to as much as 3.2% of gross domestic product. — B.M. Laforga with Reuters

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