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Duterte vetoes bill on Central Luzon investment, infra hub

PRESIDENT RODRIGO R. Duterte has rejected the bill creating the Regional Investment and Infrastructure Coordinating Hub of Central Luzon (RICH), citing “substantial fiscal risks” to the economy given its provisions on incentives. “A key to lasting economic development is a tax system with generally low rates and a broad tax base. The subject bill, on the other hand, significantly narrows our tax base with its mandated incentives applicable to registered enterprises in an entire region,” reads a March 13 letter addressed to the Senate and the House of Representatives. The proposed law, contained in Senate Bill 1997 and House Bill No. 8637, provides incentives for 50 years with an option to extend for another 50. “Prolonging such a situation for half a century or more is likely to bring negative revenue and fiscal implications to succeeding administrations and unnecessarily burden future generations,” the letter points out. Under the consolidated bill approved by both chambers of Congress, RICH would lead in the development of the Central Luzon Investment Corridor Master Plan, which would incorporate existing plans for the development of the Subic-Clark and Tarlac areas.

Mayon Volcano continues ‘moderate’ unrest level with 6 steam eruptions recorded Wednesday evening

MAYON VOLCANO in Albay remains at a moderate level of unrest with six phreatic eruptions recorded Wednesday evening. The Philippine Institute of Volcanology and Seismology (Phivolcs), in its March 14 bulletin as of 8 a.m., said the ash plume generated from these eruptions rose between 200 to 700 meters above the summit before drifting west. Six volcanic earthquakes and three rockfall events were also recorded. In the previous 24 hours, three similar eruptions were also monitored. “Fair crater glow from the summit could be observed at night. Sulfur dioxide (SO2) emission was measured at an average of 763 tonnes/day on 13 March,” Phivolcs said. The alert level 2 remains in place, which means the public is warned of possible “sudden explosions, lava collapses, pyroclastic density currents or PDCs and ashfall. Entry is strictly prohibited within the six kilometer-radius Permanent Danger Zone as well as the precautionary seven kilometer-radius extended danger zone. “Active stream/river channels and those identified as perennially lahar-prone areas on all sectors of the volcano should also be avoided, especially during extreme weather conditions when there is heavy and prolonged rainfall,” it added.

Cebu Duty Free shops contribute 11% to DFPC sales

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THE DUTY FREE shopping area at the Mactan-Cebu International Airport Terminal 2. — BW FILE PHOTO

THE TWO Duty Free outlets in Cebu contributed 11% to the state-owned Duty Free Philippines Corp.’s (DFPC) $217 million sales in 2018, DFPC Marketing Officer-in-Charge Ma. Lourdes P. Malabuyo said. The DFPC shops in Cebu are located at the Mactan-Cebu International Airport Terminal 1 and 2. Ms. Malabuyo said the 11% share is considered significant as there are only 11 Duty Free outlets across the country. DFPC recently closed two offsite outlets in Cebu, located at the Waterfront Cebu City Hotel and Casino and at SM City Cebu. Meanwhile, the company, an attached agency of the Department of Tourism, will open two stores this year, one in Panglao Island, Bohol and another in Palawan. Duty Free stores’ top shoppers are Filipino tourists, balikbayans (homecoming Filipinos living abroad), and overseas Filipino workers. An emerging market is the growing number of Chinese tourists visiting the country. — The Freeman

Marawi City vice-mayor also facing drug, murder cases

MARAWI CITY Vice-Mayor Arafat Salic, who was arrested at the city hall on March 13 over rebellion charges, is also facing cases relating to illegal drugs and murder, according to military officials. “He came with us voluntarily,” said Col. Romeo S. Brawner, Jr., 103rd Infantry Brigade commander. “Last night we turned him over to the PNP (Philippine National Police) but they asked us to let him stay here in the camp in the meantime for his safety,” he added. Lt. Col. Gerry M. Besana, spokesman of the military’s Western Mindanao Command (WestMinCom), said the arrest was “in relation to the Marawi siege,” with Mr. Arafat in the list of the Office of the Martial Law Administrator Arrest Order dated September 4, 2017. “Aside from rebellion, he also has drug related cases in PDEA (Philippine Drug Enforcement Agency), and other cases filed and other murder-related cases filed against him,” said Mr. Brawner. Meanwhile, Mr. Brawner said 135 fighters and supporters of the Maute group, which was responsible for the Marawi siege, have surrendered to authorities. “They help us identify members [of the Maute Group]. More than that, they also help in our campaign in preventing and countering violent extremism,” he said. — Tajallih S. Basman

Measles cases in Bangsamoro region drop, but still at 361 so far this year

THE MINISTRY of Health (MoH) in the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) reported 361 confirmed measles cases from Jan. to March 10 this year, a significant drop from 1,260 cases in the same period last year. The highest number was recorded in Lanao del Sur at 230, including 101 in the capital Marawi City. Maguindanao had 119; Tawi-Tawi, 11; and Sulu, 1. There was no confirmed case in Basilan. In a press conference Tuesday, MoH Minister Safrullah M. Dipatuan said the ministry is intensifying efforts to address the preventable disease, including the promotion of immunization. He said, “Immunization prevents deaths and suffering from vaccine-preventable diseases such as measles, tetanus, polio, pneumonia, hepatitis, diphtheria, rubella, and mumps.” With the BARMM having a Muslim majority population, the MoH issued a fatwa or Islamic ruling earlier this week, in coordination with the Regional Darul Ifta (religious leaders), to clarify that the vaccines are permissible under the Islamic faith and encourage parents to bring their children for vaccination at the health centers. — Tajallih S. Basman

Davao City coastal road segment eyed for opening by end-2019

A PORTION of the P19.8 billion Davao City Coastal Bypass Road Project, which started construction in 2017, is expected to be partially opened before the year ends. “Construction of the coastal road is still ongoing and hopefully within the year a portion will be opened to the public,” said Councilor Jesus Joseph P. Zozobrado III, chair of the committee on public works and vice-chair of the committee on transportation. Based on the Department of Public Works and Highways (DPWH) accomplishment report as of Feb. 28, the Bago Aplaya-Talomo segment is already 87% done. The coastal road stretches from Bago Aplaya in the south to R. Castillo in the north. Mr. Zozobrado said the DPWH has to make some adjustments in the design to address the concerns of the fisherfolk relating to the boat landing area. “The initial design did not have enough space for the existing boats, but since the fisherfolk requested more space for their boats and they want direct access to the river, then DPWH is re-evaluating the design,” he said.— Carmencita A. Carillo

Nation at a Glance — (03/15/19)

News stories from across the nation. Visit www.bworldonline.com (section: The Nation) to read more national and regional news from the Philippines.
Nation at a Glance — (03/15/19)

Peso weakens in ‘muted’ trading session

peso dollar
THE PESO dropped amid a lack of leads.

THE PESO weakened against the dollar on Thursday amid “muted” trading as market players await catalysts.
The local currency closed Thursday’s session at P52.60 versus the greenback, down five centavos from the P52.55 finish on Wednesday.
The peso opened the session at its intraday high of P52.50 per dollar, while its worst showing stood at P52.695 versus the US currency.
Trading volume thinned to $1.202 billion from the $1.755 billion that switched hands the previous day.
A foreign exchange trader said the peso moved within a small range yesterday.
“Trading was somehow muted [on Thursday] as market players saw agent banks again selling heavy amount of dollars,” the trader said.
The trader added that the peso weakened even as the dollar also declined against major currencies overnight.
Reuters reported that the dollar index was up 0.1% yesterday to 96.633 versus a basket of currencies yesterday.
“I guess market players were just looking for drivers at the market, waiting for further news of what’s to come or what will drive the dollar-peso higher or lower,” the trader said.
Meanwhile, another trader said the peso depreciated on market risk-off sentiment following the weaker-than-expected US producer inflation and durable goods data, as well as the uncertainty on the Brexit deal which heightened fears of a further global growth slowdown.
In a 312-308 vote, members of the British parliament rejected the idea of leaving the European Union without a deal, as they are set to vote on whether the United Kingdom will ask the economic bloc to delay the March 29 departure.
The trader added that the Bangko Sentral ng Pilipinas (BSP) “seemed to intervene” at the P52.70 level.
As the country’s monetary authority, the BSP sometimes conducts “tactical interventions” to temper any sharp swings that may cause the peso to appreciate or depreciate.
For today, the first trader expects the peso to move between P52.40 and P52.85 versus the dollar, while the other gave a P52.50-P52.70 range.
Most other Asian currencies also weakened against the dollar on Thursday, as investors grappled with a slew of economic data from the region’s largest trading partner, China, while uncertainty over a US-Sino trade deal continued to weigh on risk appetite.
China’s industrial output fell to a 17-year low in the first two months of the year, data showed on Thursday, while investment picked up speed as the government fast-tracked more road and rail projects as they work to avert a sharper slowdown.
Among the regional players, currencies that are more sensitive to trade tensions such as the Singapore dollar weakened 0.2%, while the South Korean won edged lower. — K.A.N. Vidal with Reuters

Shares decline anew amid lack of fresh catalysts

By Arra B. Francia, Reporter
STOCKS RETREATED on Thursday as investors remained on the sidelines amid a lack of fresh leads.
The benchmark Philippine Stock Exchange index (PSEi) slipped 0.2% or 15.73 points to close at 7,750.42 yesterday, snapping its two-day ascent. The broader all-shares index likewise fell 0.32% or 15.66 points to 4,785.01.
“The lack of fresh catalysts is keeping investors cautious and they are being very selective as we wait for developments from the Sino-US trade deal,” Timson Securities, Inc. equities trader Jervin S. de Celis said in a mobile phone message on Thursday.
US President Donald J. Trump said on Wednesday that he is in “no rush” to complete the trade deal with China, despite expectations that he will hold a summit with Chinese President Xi Jinping later this month in his Mar-a-Lago property in Florida.
Mr. De Celis also noted that the Financial Times Stock Exchange index (FTSE) rebalancing will take effect on Friday, which may have influenced the market.
Papa Securities Corp. Sales Associate Gabriel Jose F. Perez said the FTSE rebalancing will see the addition of JG Summit Holdings, Inc. (JGS), San Miguel Food and Beverage, Inc., (FB) and San Miguel Corp. (SMC).
The three firms were among the 20 most actively traded stocks for the day, although all recorded losses. Shares in JGS dropped 2.37% to P61.70 each; FB slumped 3.07% to P104.10 apiece; while SMC slipped 0.23% to P172 each.
“Apart from that, US index movement tonight could still have an impact tomorrow, more so if the S&P 500 continues to breakout from its resistance area,” Mr. Perez said in an e-mail on Thursday.
Four sectoral indices moved to negative territory, led by industrials which plunged 0.56% or 65.53 points to 11,551.98. Property dropped 0.39% or 15.45 points to 3,902.86; holding firms dipped 0.3% or 23.38 points to 7,671.73; while financials went down 0.13% or 2.44 points to 1,762.36.
In contrast, mining and oil jumped 1.66% or 132.39 points to 8,079.75, while services climbed 0.23% or 3.63 points to 1,572.20.
Some 1.80 billion issues switched hands valued at P5.60 billion, slightly higher than the previous session’s P5.14 billion.
Decliners outpaced advancers, 107 to 77, while 49 names were unchanged.
Foreign investors turned buyers, recording net purchases of P322.87 million versus a net selling position of P110.51 million on Wednesday.
Wall Street indices firmed up on Wednesday, with the Dow Jones Industrial Average closing 0.58% higher or 148.23 points to 25,702.89. The S&P 500 index gained 0.69% or 19.40 points to 2,810.92, while the Nasdaq Composite index advanced 0.69% or 52.37 points to 7,643.41.
Meanwhile, Southeast Asian stock markets remained subdued on Thursday in thin trade as investors chose to wait and watch after a mixed set of economic data.

Dev’t planners turn cautious on outlook

By Melissa Luz T. Lopez
Senior Reporter
STATE ECONOMIC MANAGERS on Wednesday slashed gross domestic product (GDP) expansion targets for this year and 2020, citing 2019 constraints from the delayed enactment of the national budget that will make it “very difficult” to catch up with spending which, in turn, could even push growth to an eight-year low.
The inter-agency Development Budget Coordination Committee slashed its 2019 GDP growth forecast to 6-7% from 7-8% originally as the government operates on a reenacted budget.
“In reality, you’ll have to take into consideration the weather conditions in the latter half of the year. No matter how much you want to fast-track it, if the rains are heavy, you just can’t catch up… it will be very difficult,” Finance Secretary Carlos G. Dominguez III said during a press briefing after Wednesday’s meeting.
The government expects to spend P3.78 trillion this year, lower than the P3.833 trillion estimate back in October. The DBCC also scaled down the revenue goal to P3.15 trillion from P3.208 trillion previously. Of this, P162.2 billion will be generated by Republic Act No. 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN) Act.
The deficit is projected to settle at P631.5 billion, equivalent of 3.2% of GDP. The fiscal gap is seen narrowing to three percent of GDP yearly from 2020 to 2022.
In a separate statement, the National Economic and Development Authority (NEDA) said growth could slide to as low as 4.2% if the new spending plan is not passed at all.
Lawmakers remain in deadlock over details of the P3.757-trillion spending plan, with the Senate accusing the House of Representatives of making last-minute adjustments to the ratified budget measure, after a meeting of leaders of both legislative chambers with President Rodrigo R. Duterte last Tuesday night failed to resolve their differences.
The government is currently operating on a reenacted 2018 budget, which leaves new programs and even big-ticket infrastructure projects unfunded.
Socioeconomic Planning Secretary Ernesto M. Pernia said a reenacted budget until April could drag full-year growth to 6.1-6.3%, far from the state’s original target, likely matching 2018’s 6.2% pace.
If the budget is enacted in August — as Sen. Panfilo M. Lacson had warned — GDP growth could slide to just 4.9-5.1%.
“The government would not be able to quickly execute programs and projects. This means that we will miss the opportunity to create as much as 180,000-240,000 more jobs, and fail to lift as much as 400,000-550,000 more Filipinos out of poverty this year,” Mr. Pernia was quoted as saying in a statement.
If realized, this would be the slowest growth pace since 2011, when the economy expanded by just 3.7%.
The estimates factor in delays in the implementation of new and ongoing infrastructure projects, as well as in delivery of social services like the unconditional cash transfers for 10 million poorest households as well as fuel subsidies for jeepney drivers as provided under the TRAIN law.
A reenacted budget also leaves the next tranche of salary increases for government workers unfunded.
Janet B. Abuel, officer-in-charge of the Department of Budget and Management, also noted that growth could scale back by up to 2.8 percentage points if the budget were reenacted for the entire 2019.
“We therefore urge Congress to transmit the 2019 national budget at the soonest possible time to Malacañang so the government can sustain its investments on development priorities, namely public infrastructure and social services,” Ms. Abuel added.
“The longer the budget impasse lasts, the larger the adverse effect to the Philippine economy and its people.”
The DBCC sees GDP growth picking up to 6.5-7.5% in 2020 — against an initial 7-8% projection — before rising to 7-8% in 2021 and 2022.
The economic team also maintained inflation forecasts at 3-4% this year and 2-4% annually until 2022, confident that price increases will go back to normal from last year’s surge. The estimate for the peso-dollar exchange rate was retained at P52-55.
Dubai oil prices are seen at $60-75 per barrel for the next four years.
The DBCC raised its forecast for the 364-day Treasury bill rate to 5.5-6.5% this year from 4.5-5.5% previously, while the London interbank rate was cut to 2.5-3.5% from 3.0-3.5% previously.
Other risks factored into the forecasts include a “mild” El Niño phenomenon, as well as unresolved trade tensions between the United States and China.
Meanwhile, Mr. Dominguez mentioned that the current water supply problem in Metro Manila would have been “much less serious” had the government pursued the construction of the Kaliwa dam, a project first proposed 34 years ago meant to satisfy increased water needs of Metro Manila, Cavite, Rizal and Bulacan.
A Chinese contractor is set to build the P12.1-billion dam project that is scheduled to be completed by 2022.

Duterte fails to break deadlock over budget

By Camille A. Aguinaldo
Reporter
LEADERS of the Senate and of the House of Representatives failed to mend their differences over the ratified P3.757-trillion national budget for 2019 during a meeting with President Rodrigo R. Duterte in Malacañang on Tuesday evening.
The Senate stood its ground that Congress should transmit to the President the version of the 2019 national budget that does not contain the post-ratification changes made by the House.
“The President had asked us to pass the budget so that the programs of government can continue… We still met (after) the President had left but there’s still no consensus, unfortunately,” Senate Majority Leader Juan Miguel F. Zubiri told reporters in a mobile phone message Tuesday evening.
Senate President Vicente C. Sotto III said Mr. Duterte opened the meeting by saying that he would not sign the 2019 national budget if the Senate leader would not sign it as well.
He added that Senator Panfilo M. Lacson suggested that the House recall the national budget it transmitted to the Senate, allegedly containing post-ratification adjustments, and transmit instead the version that was ratified by the two chambers.
“The President and members of the Executive department concurred (with Mr. Lacson’s suggestion). HoR (House of Representatives) appeared to have acquiesced but we have yet to see if they will follow the agreement,” Mr. Sotto told reporters in a mobile phone message on Tuesday evening.
House Majority Leader Fredenil H. Castro of Capiz’s 2nd district asked Senator Loren B. Legarda, chair of the Senate Committee on Finance, and House Appropriations Committee chairman Rolando G. Andaya, Jr. of Camarines Sur’s 1st district of to “meet at the soonest possible time.”
“Pag-usapan na ito nang mabuti, one setting lang siguro. Let’s be open with each other at huwag na galawin kung ano ang panuntunan noong una pa, kung ano ‘yung tradition noong una pa na nagpapabilis sa pag-apruba sa national budget (Let us discuss this well in one setting; Let’s be open with each other and not change processes and traditions that had ensured the prompt approval of the national budget),” Mr. Castro said in a news briefing on Wednesday.
Asked if Duterte set a deadline for resolution, Mr. Castro replied: “The timeline is very short”.
“Sinabi ni Presidente na (The President said) finish it. We cannot afford to make it longer, the country and everybody is bleeding everyday.”
The House transmitted the national budget for Mr. Sotto’s signature last Monday. But the Senate leader asserted that he wouldn’t sign the measure if it contained post-ratification realignments of the House. Specifically, Mr. Sotto had alleged that the House realigned P79 billion of the Department of Public Works and Highways budget while Mr. Lacson claimed P15 billion of Health department funds were “manipulated” after the bill was ratified on Feb. 8.
“Maliwanag dito sa nakikita ng LBRMO (Legislative Budget Research and Monitoring Office)… Maliwanag na nagalaw at ang tinamaan nga ay ‘yung mga vi-net ng mga Cabinet secretaries ito, pagkatapos ililipat sa (congressional) districts. ‘Yun ang mabigat, after ratification (It’s clear, as the LBRMO saw… It‘s clear that the budget was altered and the projects vetted by Cabinet secretaries were affected and were transferred to congressional districts… after ratification),” Mr. Sotto said in a radio interview on Wednesday.
For Mr. Lacson, “[t]he bottom line for us in the Senate, we cannot adopt something that is unconstitutional because the provision in the Constitution is clear: upon the last reading of a bill, no amendment thereto shall be allowed.”
“So it’s a stalemate again because if the congressmen or the House insist on their printed copy as the enrolled bill, then it will never reach Malacañang.”
Mr. Lacson told reporters that the meeting was “civil,” even as he noted that House Speaker Gloria M. Arroyo was quiet during the entire discussion with the President. “She was quiet all the time. It was all ‘Nonoy’ Andaya. Nobody else spoke except Nonoy Andaya,” he said.
Ateneo Policy Center Research Fellow Michael Henry Ll. Yusingco said the latest developments on the budget did not necessarily reflect Mr. Duterte’s poor hold on Congress.
“President Duterte is probably waiting for the leaders of Congress to resolve this problem on their own, as the Constitution expects them to do,” Mr. Yusingco said in an e-mail when sought for comment.
“But the huge ramification of not enacting a new budget could push the President to flex his political muscles. And this could very well happen in the next couple of days.” — with Charmaine A. Tadalan

Year-to-date car sales down even as they steady in Feb.

A SLIGHT ANNUAL PICKUP of automobile sales in February was unable to send year-to-date performance into positive territory, according to latest joint data from the Chamber of Automotive Manufacturers of the Philippines, Inc. and the Truck Manufacturers Association that were e-mailed to journalists on Monday.
Their latest report showed that sales edged up by 0.6% to 26,327 units last month from the year-ago 26,176, but were still 2.1% less than January’s 26,888.
Vehicle Sales in the Philippines
Some 8,471 passenger cars were sold last month — accounting for 32.18% of total industry sales — about 3.4% more than the year-ago 8,192 units but 0.19% less than January’s 8,487.
Commercial vehicle sales, which accounted for 67.82% of February’s total sales, decreased 0.7% to 17,856 units from the 17,984 recorded in February 2018 and by a bigger three percent from January’s 18,401.
Under the commercial vehicles category, last month’s sales of Asian utility vehicles fell 59.2% to 2,227 units from 5,463 a year ago and by 7.6% from January’s 2,410, while those of light commercial vehicles rose 25.2% to 14,449 units in February from 11,540 a year ago even as the latest tally was still 3.9% less than January’s 15,037 units.
Year-to-date automobile sales totaled 53,215 units, down eight percent from the 57,821 units registered in 2018’s comparable two months.
Year-to-date passenger car sales thinned 5.7% to 16,958 units while those of commercial vehicles dropped nine percent to 36,257 units.
The auto industry had said it anticipates a gradual recovery in sales to register 10% growth from 2018. The year 2018 saw local car sales fall the first time in seven years, sliding 16% to 357,410 units from 2017 amid higher automobile excise taxes, acceleration of inflation and high oil prices.
Year-to-date, Toyota Motors Philippines Corp. continued to top the list with a 38.75% market share with 20,622 units sold, down 10.5%. It was followed by Mitsubishi Motors Philippines Corp. with 10,439 units sold, or 19.62%, down 18.6% and Nissan Philippines, Inc. with 6,623 units, or 12.45%, up 73.9%. — J. C. Lim

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