Facebook Instagram Linkedin Twitter Youtube
Home Blog Page 9845

Providing world-class connectivity

Telecommunications has become one of the lifeblood of the modern world. It happened to be the driving force behind massive changes and multitudinous advances in the society, impacting all individuals in all spheres of life.

In the Philippines, such big and influential industry is more commonly associated with astute businessman Manuel “Manny” V. Pangilinan who currently holds the top position in the country’s leading telecommunications and digital services provider PLDT, Inc. With the company’s wide range of products and services, together with the success it has achieved over the years, Mr. Pangilinan is often dubbed as the local “telco king.”

It was in 1998 when Mr. Pangilinan took over the PLDT after First Pacific Co. Ltd., a Hong Kong-based firm also founded by the now 73-year-old business magnate, bought a 17.5% stake in the formerly-known Philippine Long Distance Telephone Company. The acquisition made First Pacific the majority owner of the PLDT thus, naming Mr. Pangilinan as its new president and chief executive officer who brought in a new culture in the company.

Despite some challenges brought by the changing times, PLDT remains steadfast in fulfilling its commitment to serve the nation and provide communications solutions to Filipinos.

In 2018, the telco conglomerate continued to expand its fiber optic cable network, providing the vital foundation for further developing and modernizing the group’s fixed and mobile networks. It ended the year with a total fiber footprint of 244,000 kilometers. PLDT Home’s fiber coverage reached a total of 6.3 million homes. At the same time, total capacity reached 2.6 million ports with about one million ports available for sale.

Meanwhile, Smart Communications, Inc., the wireless unit of PLDT, likewise stepped-up the deployment of Long-Term Evolution (LTE) and LTE-Advanced (LTE-A) networks and carrier aggregation technology across the country, enabling it to fulfill its commitment to the government to provide mobile broadband services to 90% of the country’s cities and municipalities by end-2018.

In the same year, PLDT and Smart fired up the country’s first 5G cell sites in Makati City and Clark Freeport Zone in Pampanga. According to the firm, the 5G opens up exciting possibilities for Internet of Things (IoT) applications for the transport sector, traffic management, manufacturing, airport and mall operations, logistics and warehousing, retail, customer support, and smart homes, among others.

To serve the ever-changing needs of customers in the digital landscape like the growing demand for video, gaming and smart home solutions, PLDT and Smart also expanded their portfolio of products and services and unveiled a host of new innovations.

Likewise, PLDT’s digital innovations arm Voyager Innovations, Inc. continued to step up its efforts in enabling every Filipino to participate and thrive in the new economy through its inclusive financial ecosystems.

Voyager’s PayMaya, the country’s leading e-wallet app, became the first non-bank institution to join InstaPay, an electronic fund transfer service that allows customers to transfer funds almost instantly between accounts of participating banks and non-bank e-money issuers under the supervision of Bangko Sentral ng Pilipinas.

In October 2018, Voyager welcomed KKR, Tencent, IFC, and IFC Emerging Asia Fund as new investors, raising a total of $215-million funding. This marked the largest investment to date in a Philippine technology firm.

Amid PLDT’s efforts to bring its operations to world-class standards, its commitment to enrich the lives of the Filipino people remains at its core. The group continued to contribute in improving the quality of life of Filipinos through its various corporate social responsibility programs that span from digital literacy, disaster preparedness and response, sustainable livelihood, up to environmental protection.

As a testament to all the milestones that the PLDT and its subsidiaries have achieved, Mr. Pangilinan was named Telecom CEO of the Year in 2018 at the Telecom Asia Awards, the longest-running industry awards program in the region that seeks to recognize premier service providers and telco executives.

“I accept this award with caution and humility,” Mr. Pangilinan said. “I am very mindful that in this age of relentless disruption, each new day brings fresh challenges. If anything, this award serves as a reminder that we must keep striving to reinvent our businesses and improve the lives of our people.”

To attain higher levels of growth this 2019, the PLDT, according to Mr. Pangilinan, is geared to keep on improving customer experience, while being mindful of the future and staying focused on transforming PLDT and Smart into one digitally enabled team.

“Given these initiatives and the positive momentum built up in 2018, we expect service revenues to rise and our Telco Core Income to grow to P26 billion in 2019,” Mr. Pangilinan was quoted as saying in PLDT’s 2018 annual report. — Mark Louis F. Ferrolino

Leading the future of energy in the Philippines

Manny V. Pangilinan has ever been the face of energy in recent Philippine memory. With good reason, with him chairing the most important energy company in the country.

The Manila Electric Company, otherwise known as Meralco, is the only distributor of electric power in Metro Manila. Meralco’s reach even extends to the power distribution franchise it has for 22 cities and 89 municipalities, including the whole of the National Capital Region and the exurbs that form Mega Manila.

In fact, Meralco has been serving the residents of Manila more than a hundred years ago, back when it was first originally called the Manila Electric Railroad And Light Company. The company’s storied history saw it build its foundations at the hands of the American occupation, survive World War II and the Japanese takeover, and rise into what it is today.

Meralco is now the largest private sector electric distribution utility company in the Philippines covering 36 cities and 75 municipalities, serving over 6.6 million customers. Its franchise area of over 9,685 sq. km. includes the country’s industrial, commercial, and population centers. At year-end 2018, it recorded a market capitalization of P428.3 billion (US$8.1 billion).

For the full-year 2018, core net income for the company rose 10.9% to P22.41 billion from P20.21 billion previously, driven by the 5% increase in volume of energy distributed, higher financing income from the funds deployed due to the improved yields, recognition of service fees, among others.

In part, Meralco has managed to sustain its upward momentum through continued evolution and adaptation to the changing times.

Mr. Pangilinan said of the company’s guiding principles, “If change for Meralco has been the hallmark these past 25 years, more of it will come to define our future.”

One example is Meralco’s recent announcement significantly expanding its plans to invest in renewable energy projects in the coming years. The company pledged a commitment to developing 1,000 MW of renewable energy projects in the next 5-7 years, “joining the inexorable shift to renewable energy and the adoption of sustainable practices in everything we do,” recently appointed Meralco President and CEO Atty. Ray C. Espinosa said.

“Meralco is committed to developing large-scale renewable energy projects that can deliver competitive electricity for our customers, without any requirement for subsidy or support, while keeping environmental stewardship and sustainability as top priorities in our business,” Atty. Espinosa added.

As part of this plan, MGEN Renewable Energy, Inc. (MGreen) has been established to serve as the platform for the strategic push to develop renewable energy projects, primarily solar, wind and run-of-river hydro. The new company aims to bring in additional supply to support the Philippines’ growth momentum and help ensure the availability of green and cost-competitive power supply in the coming years.

MGreen is a wholly owned subsidiary of Meralco PowerGen Corporation (MGen), which in turn is the power generation arm of Meralco.

“We are working on several renewable energy prospects and we recognize the significant reduction in the development cost, particularly for large-scale solar and wind over the past years. Notwithstanding the ongoing requirement for new reliable baseload generation to support the fast-growing Philippine economy, we believe that the time is right to focus on building our green energy capacity and we intend to be a key player in this expanding sector,” MGen President and CEO Rogelio L. Singson said.

“MGen, through MGreen, will continue working on the realization of our project opportunities, and will work in partnership with established developers to maximize our growth potential,” he added.

Mr. Singson further said that the plan is aligned with MGen’s growth aspirations, which are focused on advancing renewable energy prospects and utilization of high efficiency, low emission (HELE) technology for baseload power plants.

“We will continue to work with the energy industry, government and other stakeholders to serve the country’s energy needs while ever mindful of our greater responsibility to society and the planet,” Mr. Singson said.

As the world shifts away from conventional power sources in favor of cleaner, sustainable, and more environmentally-friendly alternatives, Meralco and MGen’s initiatives pursuing the development of renewable energy sources will put the country in a position of opportunity. As Meralco evolves to meet the needs of the future, so will the Philippines. — Bjorn Biel M. Beltran

Smart Padala by PayMaya empowers communities with digital financial services

Digital financial services adoption is growing fast as mobile and internet penetrate all corners of the country. For most of the unbanked and underserved, the transformation to digital is getting a boost from the traditional and most basic retail presence on ground — through sari-sari stores powered by Smart Padala by PayMaya.

“For financial inclusion efforts to bear fruit, they should be able to reach people at the grassroots, and that means including those in the far-flung areas of the country. Because your favorite Smart Padala by PayMaya center is often also the nearest sari-sari store to your house, we are able to bring digital financial services to Filipinos whenever and wherever they need it,” said Kenneth Palacios, Director and Head of Wallets Business at PayMaya.

With more than 27,000 partner agents nationwide, Smart Padala by PayMaya is the only domestic network capable of reaching even the farthest communities of the country. This allows its agents to deliver critical financial services to areas that are not traditionally reached by bank branches and other financial touchpoints, which are usually located in urban cities or municipal centers.

According to the Bangko Sentral ng Pilipinas (BSP) 2015 National Baseline Survey for Financial Inclusion, which contains the most recent data available on time and money spent to access financial services, Filipinos usually travel 21 minutes and spend at least PhP43 on average to get to the nearest traditional financial service access point in their area.

Because Smart Padala by PayMaya centers are able to penetrate even the innermost communities in many provinces, the financial inclusion potential of these hubs cannot be understated.

Reaching the underserved and unbanked

In the streets of Rodriguez, Rizal just outside Metro Manila, the sari-sari store of Lilia Ramos has become a focal point for the community whenever they want to send money to their family in the province.

Every day, students would go to Lilia’s store to pick up their allowance from their parents living in various places around the country. On payday, people would flock to Lilia’s store to send money to their loved ones back home. In cases of emergencies, it only takes a few taps on Lilia’s mobile phone to send the money needed for the urgent needs of her customer’s family.

“It’s good to hear that your customers trust you, and we adjust to their needs like having to wake up early to open the store because the money that they receive from relatives is often for school or work allowance,” Ramos said.

Promoting microentrepreneurship

Another such example is Yolanda Benigno, a Smart Padala by PayMaya agent from Manila who originally hails from Bicol. Fueled by the need to provide for her relatives, she put up several businesses that included a street-food cart and a Smart Padala by PayMaya center, which eventually branched out into four centers in the city.

“From one center, I was able to put up a few more because I didn’t really expect that the demand would be that great initially. Especially when it is payday, workers would really line up to send money for their families in the provinces,” Benigno shared.

As PayMaya broadens its reach across the country and delivers more innovative digital services, Smart Padala by PayMaya centers are now becoming digital financial hubs of their respective communities, offering services such as bills payment and airtime load top-up in addition to the traditional domestic remittance service.

Together with other services such as the PayMaya mobile app and e-wallet as well as the PayMaya Business suite of solutions for enterprises, Smart Padala by PayMaya supports the BSP’s 20 by 2020 goal of increasing total electronic transactions to 20% as it prepares the country to participate in the larger global digital economy.

PayMaya, the digital financial services arm of Voyager Innovations, is the leading fintech company in the Philippines offering integrated consumer and merchant payment solutions with the widest on-ground branch network. Voyager Innovations is backed by PLDT, KKR, Tencent, and World Bank’s IFC. Last November 2018, it raised the largest tech funding round for a Philippine-based company.

Bringing businesses together for sustainable development

Manny V. Pangilinan (MVP), one of the country’s most prominent businessmen today, is not only a leader who holds top positions in some of the country’s top business firms. As he currently serves as the chairman of the Philippine Business for Social Progress (PBSP), the country’s largest business-led nongovernmental organization (NGO), MVP is also a leader harnessing businesses to uphold the causes of sustainable development and poverty reduction.

PBSP has been in the business of making an impact to communities since its establishment in 1970. According to its Web site, PBSP is envisioned “to lead the business sector’s efforts to reduce poverty in the Philippines”. Its mission affirms the NGO’s commitment to poverty reduction “by promoting business sector leadership in, and commitment to programs that lead to self-reliance.”

MVP shares PBSP’s belief that backs up everything it does: working together works.

“We, as PBSP, decided to subscribe to collective impact as a strategy because of one question: ‘After decades of doing tireless work with other NGOs and Government, why are we still talking about the same problems of poverty and inequity?’,” Mr. Pangilinan stated in his message in the latest annual report published by PBSP on its Web site.

Recognizing the complexity of social problems and the diversity of ways by which different sectors hope to solve them, MVP points to PBSP as a fitting partner for them to deliver those solutions.

“PBSP, through its different platforms of collective engagement or PlaCEs under each of our program areas, provide a venue to coordinate with and convene stakeholders, consolidate mutually reinforcing initiatives, co-create sustainable solutions, and consistently communicate updates and accomplishments,” Mr. Pangilinan wrote.

PBSP, which currently has 274 member-companies, forms sustainable solutions to societal problems through its programs oriented towards health, education, environment, and livelihood and enterprise development.

The health program of the PBSP aims to “contribute to the improvement of the health situation in the Philippines” through programs that seek to reduce maternal and child mortality, detect and cure tuberculosis, improve nutrition, ensure reproductive health services for women of reproductive age, and achieve universal health coverage among poor families.

PBSP’s flagship initiatives in health are tuberculosis control projects involving TB diagnostic mobile vans, mass screenings, and AI-assisted screenings; a safe motherhood caravan called “Babae: Malusog. Ligtas. Handa.”; and a supplemental feeding program dubbed as “NutriSapat, Batang Angat.”

As of the fiscal year (FY) 2017-2018, as posted on PBSP’s Web site, 6,949 drug-resistant tuberculosis cases have been notified; 9,506 women of reproductive age were provided with information on maternal, neonatal and child health and nutrition services; and 380 children under five provided with supplemental feeding.

Education is another core program of PBSP. The NGO’s program for education assists in improving the quality of education for Filipino learners, especially senior high school students.

Notably, PBSP attends to disadvantaged children through educational assistance/scholarship program, while it addresses the gap in classrooms by constructing disaster-resilient, PWD-inclusive, and gender-sensitive classrooms.

PBSP also has Bayanihang Pampaaralan, its educational platform for collective engagement. “This is focused on capability building of public schools as well as influencing systems of change to contribute to the attainment of desired education outcomes and impact,” PBSP wrote on its Web site. “This program shall enable HS graduates to be ready for work or entrepreneurship, fit for jobs or ready for college.”

The previous fiscal year witnessed 1,830 students who were provided with educational assistance/scholarship, as well as 134 constructed classrooms.

PBSP also has programs on the environment which “focuses on contributing to increase the resiliency of natural resources and enhance the ability of communities to adapt to climate change effects.”

For instance, the Buhisan Watershed reforestation project enabled PBSP and its stakeholders to plant over 200,000 trees within 600 hectares (ha) with 80% survival rate. It also has heeded the call to reforest the Marikina Watershed when it was devastated by Typhoon Ondoy in 2009. So far, its tree planting initiative in the watershed has covered 304 ha.

In addition, it has established the Water Alliance, a coalition “committed to create solutions to the water problems in the Philippines.” One of the alliance’s several accomplishments include providing 39 communities including schools with potable water systems worth P81 million through funding support from the members.

FY 2017-2018 tallied 1,136 families provided with access to safe drinking water, 17 schools provided with potable water systems, and 179 hectares of reforested watersheds.

Livelihood and enterprise development is another cause PBSP upholds through its programs focused on promoting inclusive business. Its programs promoting this particular advocacy supports agro-enterprise value chain development and improves people’s access to jobs through skills upgrading and employment facilitation.

Numbers from the previous fiscal year stated that 1,668 families were provided with livelihood, P192 million were loaned, and more than 4,000 micro, small, and medium enterprises (MSMEs) benefitted from credit and non-credit services. — Adrian Paul B. Conoza

Speakership scheme could stunt reforms

By Charmaine A. Tadalan
Reporter

THE PLANNED term-sharing of speaker aspirants Taguig 1st district Rep. Alan Peter S. Cayetano and Marinduque Rep. Lord Allan Jay Q. Velasco could disrupt reform impetus in the remaining three years of President Rodrigo R. Duterte’s term, analysts said on Thursday last week.

Mr. Duterte on Monday last week stepped in to end an impasse between the two speakership bets by endorsing Mr. Cayetano to lead the House of Representatives in the first 15 months, and Mr. Velasco for the remaining 21 months of the 18th Congress.

While both lawmakers vowed to push the President’s legislative agenda, University of the Philippines political science department chairperson Maria Ela L. Atienza said in an e-mail that “based on recent history and the fact that alliances in Congress are usually based on the popularity of the President, personal interests of legislators and the lack of programmatic and disciplined political parties, changes in House leadership as well as committee chairs and memberships can cause discontinuities in policy agenda, resentments and infighting within the coalition.”

“We also do not know if, by the time there will be a change in speakers, there will still be high presidential approval ratings and a supermajority coalition.”

Ms. Atienza also noted that the 2022 national elections could also distract lawmakers who will seek reelection or higher office.

“This is also true as the coming 2022 elections is an important consideration for legislators. They balance their own interests for survival and desire for reelection or election to higher posts vis-a-vis the president’s popularity, public sentiments, and strength of possible allies and interest or pressure groups.”

Michael Henry Ll. Yusingco, senior research fellow at the Ateneo Policy Center, said different objectives of two presumptive House leaders could impact desired reforms.

“For sure the priority measures by the administration will be negatively impacted by the term-sharing because the two speakers have different objectives,” Mr. Yusingco said.

“They clearly are not on the same page as far as the direction of the House is concerned,” Mr. Yusingco said in a separate e-mail.

“A lack of coherence will be palpable in the leadership of the HoR. Lawmakers will likely just sit tight and do nothing. Their minds will already be focusing on 2022. So they will be concerned only about whatever pork they can get.”

Leyte 1st District Rep. Ferdinand Martin G. Romualdez, who is being eyed for the post of majority leader, for his part, said discussions are under way to try to limit House leadership changes after Mr. Cayetano’s term.

“We are going to study the proposal of incoming Speaker Cayetano to limit the leadership change after 15 months to his position and [to] the head of the House committee on accounts so that legislative operations will remain unhampered,” Mr. Romualdez said in a mobile phone message, referring to the committee that tackles the internal budget of the House.

“We will wait for the positions of other House leaders from various political parties and influential blocs to determine if this is a workable solution to ensure a strong, stable and non-disruptive House leadership.”

Senator Aquilino L. Pimentel III, who heads the ruling Partido Demokratiko Pilipino-Lakas ng Bayan as president, said leaders of the party met with Mr. Cayetano’s camp on Thursday evening to discuss ways to ensure smooth transition amid a House leadership change.

“If matagal nang na-decide ‘yung (If it had been long decided by the) entire body na we will change our leader [in the House], but we will not change our agenda, we will not change our working style, we will not change a lot of things, we are clear about the changes, then walang manggugulo (it shouldn’t be a messy transition).”

Port regulator caps time to decide on proposals

THE PHILIPPINE PORTS AUTHORITY (PPA) is limiting the time to decide on unsolicited proposals from private groups seeking to develop local ports.

PPA General Manager Jay Daniel R. Santiago told reporters last week that Transportation Secretary Arthur P. Tugade had ordered capping the period of negotiations with private proponents to 60 days, after which a decision must be made to accept or reject proposals.

“Actually under NEDA (National Economic and Development Authority) guidelines, we have 30 days (to review proposals), but you can extend it hanggang (at the) discretion of the agency. Pero may instruction si Secretary (But Mr. Tugade gave instruction] to limit yung extension na yun [that extension] up to a maximum of 60 days total,” Mr. Santiago said.

“In 60 days you have to make a decision whether to accept or reject. No ifs, no buts.”

The new rule comes as the PPA is evaluating unsolicited proposals from Dennis A. Uy-led Chelsea Logistics and Infrastructure Holdings Corp.; Razon-led International Container Terminal Services, Inc. and Davao-based Kudos Trucking Corp. to develop Davao City’s Sasa Port, two Iloilo ports and the General Santos Port, respectively.

Mr. Santiago said the PPA gave Chelsea a letter earlier this month indicating the company’s completion of submission of documents for its P11.2-billion unsolicited bid to rehabilitate Sasa Port. This signals the start of the 60 days to negotiate the terms of the project.

“No later than first week of September dapat may decision dyan (there should be a decision on that),” he said, referring to awarding of original proponent status to a private proponent.

For ICTSI’s P8.7-billion unsolicited proposal for the Iloilo Port Complex and the Port of Dumangas in Iloilo, Mr. Santiago said regulators are still waiting for more requirements.

For Kudos’ unsolicited proposal for the Port of General Santos, the PPA chief said the letter indicating completion of its proposal requirements could be given within the month.

While talks on project terms will be limited to 60 days, Mr. Santiago said there is no deadline for companies to complete submission of proposal requirements to the PPA.

However, by the end of the Duterte administration, all incomplete proposals will automatically be considered denied.

“Secretary Tugade gave a deadline for all of the proponents and for the agency na pagdating ng June 30, 2022 at hindi ka pa lumalampas sa kahit na ano, considered rejected ‘yan (if a proponent has not completed submission of requirements by June 30, 2022, the unsolicited proposal will be considered rejected]. So when we leave by June 30, 2022, there will be no pending unsolicited proposal,” Mr. Santiago said.

Aside from the tighter timetable for negotiations with proponents, Mr. Santiago said other rules for unsolicited proposals include prohibiting government guarantee and viability gap funding (for projects that are economically justified but are not financially viable).

The stricter rules on unsolicited proposals for ports comes as the Department of Transportation ordered all private proponents for the development of airports to submit concession terms patterned after the agreement the government signed for the Clark International Airport. That set back proponents such as the consortium of seven conglomerates offering to upgrade the Ninoy Aquino International Airport, whose concession terms were returned for revision a few weeks ago — after about nine months since it started negotiations with the government.

Meanwhile, the PPA aims to release within the year a new tariff system for ports under its jurisdiction which will change the basis of handling fees from cargo type like prime and non-prime commodities — which it says could be prone to irregularities like misdeclaration — to bulk, break bulk, containerized and roll-on, roll-off (RoRo) shipments.

“I want to make the pricing uniform insofar as the packaging and handling is concerned,” Mr. Santiago said.

“… [Y]ou have one whole container of rice and one whole container of general merchandise, why should the pricing be different… eh it requires the same effort?” he explained.

“… [I]t’s a source of corruption pa. You allow the possibility na people on the ground will have different and subjective appreciation of what that cargo is. You don’t know what’s inside the container…”

This new tariff structure will be embedded in concession terms the PPA will agree on with private proponents, as well as for other ports the PPA aims to bid out for terminal leasing.

“We’re looking at about two or three (terminal leasing contracts) to be awarded this year. At least for those two or three, we should be able to embed that new tariff structure,” the PPA chief said.

For existing concessions, the new tariff system will be imposed once the concessionaires apply for a tariff increase. — Denise A. Valdez

Regions still dependent on National Revenue

Regions still dependent on National Revenue

Gov’t finalizing rules for renewable energy suppliers in option program

THE DEPARTMENT of Energy (DoE) targets to finalize in about two months a circular that will set the guidelines for the issuance of operating permits for renewable energy suppliers under the agency’s green energy option program (GEOP).

Mylene C. Capongcol, director of the department’s Renewable Energy Management Bureau (REMB), said the circular should be up for signing by Energy Secretary Alfonso G. Cusi after her unit completes gathering comments from stakeholders.

“[A]fter the 25 July pub-con (public consultation) in Clark, REMB will be consolidating and reviewing all comments and suggestions raised in the [Luzon, Visayas and Mindanao] consultations so they could come with an updated version for the Secretary’s consideration by September,” she told reporters in an online message.

On July 11, the bureau conducted the third leg of public consultations on the draft department circular that would guide end-users, renewable energy (RE) suppliers and network service providers in facilitating the option taken by end-users to choose RE resources to supply their energy needs.

Mr. Cusi had said that the DoE was committed “to establish an energy-secure future and bolstering our country’s RE resources is one avenue to achieve this. I am confident that the GEOP will give rise to a reliable market for RE generation and enhance competition among RE and other power suppliers.”

The draft circular providing the “Guidelines Governing the Issuance of Operating Permits to Renewable Energy Suppliers under the Green Energy Option Program,” serves to support the implementation of DoE Circular No. 2018-07-0019 entitled “Promulgating the Rules and Guidelines Governing the Establishment of the Green Energy Option Program Pursuant to the Renewable Energy Act of 2008.”

The public consultation focused on the guidelines and procedures in the issuance, administration and revocation of operating permits to renewable energy suppliers.

Under GEOP, electricity end-users opting to participate in the program have to inform their host distribution utility of their plan to source power from renewable energy resources. The distribution utility and renewable supplier are to inform the end-users of the technical, commercial and legal arrangements necessary to implement GEOP.

The public consultation in Batangas City was led by Ms. Capongcol and Monalisa C. Dimalanta, the recently appointed chairperson of the National Renewable Energy Board. The discussions covered sections on renewable energy supplier qualifications, application requirements, processing and approval procedures, and the revocation or cancellation of operating permits.

Previous public consultations were conducted in Cebu City and in Davao City.

The final leg of public consultations will be held on July 25 in Clark, Pampanga. — V. V. Saulon

Overtaxation seen driving POGOs away

THE government runs the risk of losing investment from the online gaming industry if it stiffens regulation and raises tax rates, industry analyst Asia Gaming Brief said.

“A lot of companies perhaps, are feeling the pinch of increased regulation, increased taxes, pressure from different government agencies… They may be moving some of their operations out of the Philippines to other jurisdictions,” Rosalind Wade, AGB Managing Director, said in a briefing late Saturday.

“If you’re going to set your tax rate at 60%… That’s just not viable from an RoI (return on investment) point of view for any kind of investor,” according to Ms. Wade.

Last week, Philippine Amusement and Gaming Corp. (PAGCOR) Chairperson and Chief Executive Officer Andrea D. Domingo said that the Department of Finance (DoF) and the Bureau of the Internal Revenue (BIR) will not overtax POGOs to the extent of losing investment.

Ms. Domingo noted that the Philippines is new to the offshore gaming industry, and the government has little experience with effective regulation.

“I’m sure that they (DoF and BIR) are all very intelligent… (and) will not overtax so that we lose whatever good (the industry brings).”

“If you kill (the industry) with unreasonable measures, then you lose everything, so we have to maintain it while observing everything that is legal. We also want to make it a good place to invest in,” she said.

The BIR is currently running after unregistered POGO (Philippine Offshore Gaming Operations)workers in order to better tax them.

The DoF has said that the government is losing around P2 billion a month for every 100,000 workers, which amounts to P24 billion a year.

Ms. Wade noted that the gaming operators, including foreign workers, also generates income for other industries such as restaurants and real estate.

“They have restaurants, they have bars, they have laundry services, they have many of the businesses, that they are contributing to the local economy here. So if all those went [away], it would create a huge hole,” Ms. Wade said.

Meanwhile, offshore gaming company Oriental Group said that it wants to hire more Filipinos for its operations, as long as they speak Chinese.

“We are trying to increase the number of Filipinos,” Kevin Wong, Oriental Group General Manager, said in a briefing on Friday.

“Actually, now we plan to set up an association where we can also try to teach the Filipinos how to speak Chinese [so that] we can remove the hurdle of language. Actually we can hire all Filipinos. Why not? But then, language is very crucial,” Mr. Wong said. — Reicelene Joy N. Ignacio

Travel industry sees job growth outperformance

THE TOURISM and hospitality sector expects to outperform in terms of job growth in the next few years, outstripping the global average, industry officials said.

Rajah Travel Corp. (RTC) and its online tourism data platform Tourism Knowledge Center (TKC) issued the projection during the second edition of its Travel Talk Series, which discussed the state of tourism jobs amid the disruptions of new technology.

Chairman and President Aileen C. Clemente said that the Philippines will not be left behind in terms of jobs and expects work opportunities to enter a boom period.

“Global tourism is growing at 5.6% and the Philippines is growing at 7.65% in terms of tourist arrivals so we’re still ahead. In terms of jobs we’re still ahead on the average of the global tourism industry. We (also) have a higher share in the Philippines,” she said.

“Nothing can replicate tour guides,” she said. “We have to have different promotions for every destination so there is a constant process of thinking about how to make it attractive and how to give an experience to somebody.”

According to the World Travel and Tourism Council (WTTC), the global travel industry accounted for $8.8 trillion or 10.4% of total GDP. It is considered one of the fastest-growing sectors behind the manufacturing industry. The WTC projects that 100 million jobs in the industry will be added globally in the next decade or 429 million jobs in total by 2029.

In the Philippines, Ms. Clemente said the tourism sector was responsible for 12.7% of GDP and 13.8% of the labor force in 2018.

TKC Executive Director Rolando T. Cañizal said that the industry is already seeing signs of encoraching technologies particularly with visitors demanding ever-newer services.

“In our travel and tourism industry, we are now seeing the great impact of technology… to develop new markets and at the same time, the rise of new travelers and tourists who are more technology-savvy and digitally oriented. In this regard, many businesses have started to adapt certain technological systems to better serve our guests and promote their products in the market,” he said.

TKC Review Committee and Asian Institute of Management (AIM) Dr. Andrew Tan Tourism Center Board of Advisor Member Maria Cherry Lyn S. Rodolfo said that like in other industries in which jobs in the tourism sector will also witness some loss, jobs in the industry will also evolve with the times.

“Jobs will not dissipate at one time. Yes, there will be some reduction of traditional jobs but these jobs will evolve,” she said.

While careers in sectors of the tourism industry such as travel agencies, hotels, and MICE (meetings, incentives, conferences and exhibitions) will still stay for the meantime, newer job expertise will need to be added to their roles because of more travel innovation.

Andy Michaels Lim, Managing Director of Amadeus IT Group, said that humans will still play a crucial role to the tourism industry even with the technological innovation.

“Technology doesn’t work without people,” he said, adding new roles that will be required in the travel industry will be digital marketer/strategist; partnerships manager; UX/UI Programmer; Web/graphic designer; and content strategist.

Even with new roles, some skills will remain irreplaceable especially if they are soft skills. Ms. Clemente said, “Technical skills we have mastered a lot of that but we need to concentrate on soft skills like analytical thinking, critical thinking, empathy, integrity, stewardship. These are things that are needed especially in the services industry.” — Gillian M. Cortez

Ortigas not keen on IPO for now

The Galleon will rise along ADB Avenue in Ortigas Center.

ORTIGAS & Co. is holding off plans for an initial public offering (IPO) at least until 2024.

“It’s premature to talk about that right now because if you look at our five-year plan, a lot of it is really internally financed,” Jaime E. Ysmael, president and chief executive officer of Ortigas & Co., told reporters after a recent briefing.

The developer of Greenhills Center earlier said it was allocating around P12 billion for capital expenditures this year. The bulk or P11 billion will be used to develop a mixed-use project called The Galleon, located along ADB Avenue in Ortigas Center.

“We’re just looking at using our balance sheet as well as pre-selling and existing rentals or development proceeds to fund our expansion program and we can actually do it without having to do any capital market issue,” Mr. Ysmael said.

The property firm, which is controlled by the Ayala, Sy and Ortigas families, had previously floated the idea of going public to raise funds for its projects.

Mr. Ysmael said Ortigas & Co. is looking to spend around P12 to P15 billion in capex for the next five years, as it ramps up expansion.

“I think in the next couple of years, we’ll see P12 to P15 billion in capex, for the next five years as we pursue expansion plans,” he said.

“We can finance our requirements so there is really no reason why we should look at the market exercise,” he added.

Mr. Ysmael said the company, like other developers, is studying the possibility of conducting an IPO but “no plans.”

Last week, Ortigas & Co. launched The Galleon, which will be developed in two phases. The first phase, an office building, is expected to be completed by the fourth quarter of 2025.

The residential condominium is scheduled to be launched early next year. — Vincent Mariel P. Galang

Congress to probe price, supply bottlenecks for biofuels

THE Joint Congressional Oversight Committee on Biofuels is set to investigate the biofuel industry over price increases in molasses when the 18th Congress opens its first regular session.

Senator Sherwin T. Gatchalian, chair of the energy committee, said the inquiry will also look into the sugarcane industry’s production of molasses, to help reduce bioethanol prices.

“We plan to convene the Joint Congressional Oversight Committee on Biofuels to look into the feedstock and pricing problem, and, in the end, come up with long-term solutions to this perennial problem,” Mr. Gatchalian said in a statement Sunday.

The Senate probe will be conducted with Department of Agriculture as well as other government agencies that are members of the National Biofuels Board. The 18th Congress will be opening its first regular session on July 22.

The Senator reported that the current price of molasses is P11,500 per metric ton, which in turn helps bring the price of bioethanol to around P59 per liter or higher.

“They say that they might soon be left without a choice but to stop the production of bioethanol since oil companies no longer buy from local ethanol plants if the price of bioethanol is too high,” he said.

“In fact, they are saying that there’s already a plant that is no longer producing bioethanol because of the high price of molasses.”

The joint committee will also tackle solutions to increase feedstock provided to ethanol plants as well as to intensify research and development for long-term solutions.

Citing data from the Department of Energy (DoE), Mr. Gatchalian said existing bioethanol plants produce 270 million liters of bioethanol, well under their capacity of 365 million liters. The DoE also noted a shortfall in molasses production, prompting the government to import 50.91% of the bioethanol requirement. — Charmaine A. Tadalan

1...9,8449,8459,846...13,338Page 9,845 of 13,338
© 2024 BusinessWorld Publishing.
All rights reserved.
Read our privacy guidelines
Facebook Instagram Linkedin Twitter Youtube