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WB advises Philippines to upgrade service sector

THE GOVERNMENT needs to support the upgrade of services and worker talent, the World Bank (WB) said, noting that global trade in goods will be subdued for quite some time.
“The opportunity for trade is in services because as technology changes, there is more cross-border trade in services… This is particularly important for the Philippines because I think the future of Philippines’ growth is going to be in high-value services,” Andrew D. Mason, acting chief economist for East Asia and Pacific region at the World Bank, said in a media briefing on Monday.
Mr. Mason pointed out that this is the way to go in spurring faster growth, at a time when global trade in goods is expected to ease especially amid trade tensions between the United States and China.
“Global trade growth is slowing but the important thing to highlight here is it’s really slowing in goods and much less in services,” he said.
Philippine merchandise exports contracted by 0.9% as of end-November, marking a sustained decline in outbound shipments of the country’s goods.
Mr. Mason said the government can pour more funds into enhancing basic education and ensuring “digital literacy” among Filipinos in order to make them more agile and armed with skills needed to keep up with technology advancement.
FOREIGN OWNERSHIP CAPS
Other reforms that can be pursued include further easing of foreign ownership limits, which Mr. Mason described as “counterproductive.”
Barriers to developing services also include the lack of competition and “bureaucratic discretion” in licensing standards for businesses.
The World Bank official also noted that opening up more industries beyond business process outsourcing will unlock more opportunities for growth.
Monday also saw members of the Joint Foreign Chambers of the Philippines separately expressing support for a Senate bill amending Republic Act No. 7042, or the Foreign Investments Act of 1991.
The Jan. 24 position paper was signed by James Wilkins, president of the American Chamber of Commerce of the Philippines, Inc.; Guenter Taus, president of the European Chamber of Commerce of the Philippines; Naoto Tago, president of the Japanese Chamber of Commerce and Industry of the Philippines, Inc.; Ho Ik Lee, president of the Korean Chamber of Commerce of the Philippines, Inc.; Julian Payne, president of the Canadian Chamber of Commerce of the Philippines, Inc.; Daniel Alexander, president of the Australia-New Zealand Chamber of Commerce of the Philippines; and Evelyn Ng, president of the Philippine Association of Multinational Companies Regional Headquarters, Inc.
In that position paper, the foreign chambers recommended approval of all proposed RA 7042 amendments contained in Senate Bill No. 2102.
The bill seeks, among others, to reduce the hiring threshold of foreign businesses wanting to set up shop in the Philippines with a minimum $100,000 paid-in capital to 15 direct hires from 50 currently under RA 7042.
It also excludes the practice of professions from the list of sectors and activities in which foreign ownership or participation is either banned or restricted, noting that “[t]he practice of profession is not an investment activity.”
The bill mandates the National Economic and Development Authority (NEDA), Department of Trade and Industry, Board of Investments, and the Securities and Exchange Commission to review the “negative list” yearly and submit a report to Congress. These agencies are also directed to report to Congress investment-related matters requiring legislation.
The bill also requires the government to create a Web portal containing the Philippines’ investment policies that will guide investors on potential areas of investments.
“We recommend the passage of all the amendments sought in SB 2102,” the foreign chambers said in their paper.
“If this bill is enacted by February 2019 when Congress recesses, NEDA could make an important contribution in its first report in April 2019,” they added.
“This report could then lead to reform legislation being passed in the 19th Congress, which we would expect to stimulate new foreign investment, technology transfer, and job creation for the Philippine economy.”
‘DARKENING SKIES’
However, “darkening skies” in the global scene could weigh on the government’s target to achieve upper middle-income status this year.
Mr. Mason said the uncertain global economic environment amid the US-China trade war and rate hikes from the US Federal Reserve may affect such prospects.
“Any trade war, if it lasts long enough, is going to have a negative effect on both local and global growth,” he said.
Socioeconomic Planning Secretary Ernesto M. Pernia, however, said that the government is confident that income per capita will reach just under $4,000 this year, assuming that economic growth will be at least six percent.
The World Bank expects the Philippine economy to grow by 6.5% this year. — Melissa Luz T. Lopez with C. A. Aguinaldo

Rock legend Joey Pepe Smith, 71

WIDELY considered as the father of Philippine rock, Joseph William Feliciano Smith — better known as Joey Pepe Smith — passed away Monday morning at the age of 71.
His death was confirmed by his daughter Desiderata Smith-Owen in a Facebook post saying, “Thank you for everything my papa bear. Thank you for being the best dad in the world. I know you’re in the best place now, no more pains papa… I will see you in [a] few days. I love you to the moon and back.”
In a comment on a Facebook post, Ms. Smith-Owen said her father had problems breathing early Monday morning and was rushed to the hospital. As of press time, there are no details about the cause of death or his wake.
Music promoter Dudee Alfonso posted on her Facebook page that the “family still doesn’t know how to proceed” as two daughters are out of the country.
Mr. Smith suffered two strokes in 2017 which affected his singing and speech. He is survived by his five children.
Born on Dec. 25, 1947, Mr. Smith learned how to play drums at the age of nine and went on to put together his first band with friends at the age of 11. A few years later, as the drummer and lead vocalist of the Eddie Reyes and the Downbeats band, Mr. Smith became a rock sensation by imitating Mick Jagger of the Rolling Stones.
The Eddie Reyes and the Downbeats band opened for the Beatles at their infamous July 4, 1966 concert in the Rizal Memorial Stadium in Manila, performing the Rolling Stone’s “Get Off of My Cloud.”
In December 1970, Pepe Smith joined seminal Filipino rock group Juan the dela Cruz band which had Wally Gonzales at the guitar and Mike Hanopol playing bass. The same year, the band played in the Antipolo Rock Festival, an open-field concert similar to the 1969 Woodstock festival in the US.
The following year, the band was tapped to play alongside the Manila Symphony Orchestra for the Philippine production of the rock opera Jesus Christ Superstar at the Cultural Center of the Philippines.
It was in 1973 that the band released its second album, Himig Natin. Its titular single became the band’s anthem and classic rock song said to have rallied Pinoy Rock.
Mr. Smith previously said that he wrote the song backstage in a ladies’ toilet while waiting for his turn to play in a 1972 concert also called Himig Natin in Rizal Park, Manila.
Other hits from the band include “Beep Beep” and “Balong Malalim” from Maskara (1974), “No Touch” and “Titser Enemy No. 1” from Kahit Anong Mangyari (1980).
In 2014, Mr. Smith starred in Jose Lorenzo “Pepe” Diokno’s film Above the Clouds, where he played the grandfather of an aloof teenager (played by Ruru Madrid) who, after having lost his parents to a flood, joins him on a trek through the Mountain Province in order to make sense of their loss.
Mr. Smith also starred in Bradley Liew’s Singing in Graveyards (2016) where he played a washed up musician who built a career impersonating Joey “Pepe” Smith and is angling for a comeback.
After the announcement of his passing, an outpouring of grief via social media ensued, with singer Gary Valenciano posting on his Instagram: “The Philippine music scene would’ve never been the same without you in it. I salute and thank you sir Pepe Smith. You rocked our world.”
“You left us a legacy Pepe Smith. Rock ‘n Roll is not dead because of you… May you rest in peace! Condolence to the family and friends he left behind. Salamat sa musika at sining (Thank you for the music and the art),” said Film Development Council of the Philippines Chairman and CEO Mary Liza Dino-Seguerra in a Facebook post.
Singer/songwriter Nicole Laurel Asensio thanked Mr. Smith on her Facebook page “for being really nice to me always, for being genuine, for giving advice and for encouraging me to sing.”
“Thank you for the music, thank you for the good vibes. Thank you for paving the way for the rest of us ‘misfits’ who just wanna rock and make people feel. You’re a legend,” she added.
Vocalist Chris “Top” Suzara, formerly of the band Freestyle, said the industry lost “one of the greatest ever.”
“With great sadness and deepest gratitude, may you rest in peace, Pepe Smith. You will never be forgotten and you will always be the only King of Pinoy Rock. You WERE Rock ‘N Roll! We all know you’ll be rocking up there in heaven, the greatest stage ever! Thank you for being the beacon of light that you always were,” he said.
“When I grow old, I would brag to younger musicians that I became friends with the person who started it all, the King of Pinoy Rock. Rest well, Pepe. We and a lot of people love you so much! Let’s see each other at the end once the time comes,” Jugs Jugueta of the Itchyworms said in vernacular in an Instagram post.
“Another OPM (Original Pilipino Music) legend bites the dust. With deep sadness, I say farewell Pepe Smith. Gentle travels,” Jaime Ramon “Jim” Paredes of APO Hiking Society said over Twitter. — Zsarlene B. Chua

Black Panther’s SAG win boosts chances at Oscars

LOS ANGELES — Superhero movie Black Panther, a film heralded for its predominantly black cast and vibrant celebration of African culture, won the top award from Hollywood’s Screen Actors Guild on Sunday, boosting its chances in this year’s Oscars race.
Black Panther was named best movie ensemble in a surprise win over favorite A Star is Born, the Bradley Cooper and Lady Gaga musical revival.
The awards from SAG-AFTRA, Hollywood’s largest actors union, are closely watched because actors form the largest voting group in the Academy of Motion Picture Arts and Sciences, the organization that hands out the Oscars next month.
Glenn Close was honored with best film actress for playing a devoted spouse in The Wife. Rami Malek won the trophy for best film actor for his portrayal of late Queen lead singer Freddie Mercury in Bohemian Rhapsody.
Only one film in the last 23 years has won the prestigious best picture Oscar without being nominated for SAG’s ensemble prize. That was last year’s fantasy romance The Shape of Water.
That scenario could repeat itself this year as SAG snubbed some of the best picture candidates in the ensemble category, including Spanish-language drama Roma, British period comedy The Favourite, and Golden Globe best comedy winner Green Book. The Oscars will be awarded Feb. 24.
Green Book did take home one SAG award. Mahershala Ali received the trophy for best supporting actor in a movie for his role as jazz pianist Don Shirley.
SAG also recognized M*A*S*H TV star Alan Alda with a lifetime achievement award.
In television, Amazon.com Inc. series The Marvelous Mrs. Maisel swept the comedy honors, winning best ensemble as well as best actor and actress for stars Tony Shalhoub and Rachel Brosnahan.
This is Us, on Comcast Corp.’s NBC, won best ensemble cast for a television drama. — Reuters

MPTC earmarks P45-billion capex for this year

METRO PACIFIC Tollways Corp. (MPTC) plans to earmark P45 billion for capital expenditures (capex) this year as it accelerates construction of five toll road projects.
Christopher Daniel C. Lizo, chief financial officer of MPTC, told reporters on Thursday the company is expected to start work on several projects once right-of-way is acquired. The investment will be used to fund five projects, namely the North Luzon Expressway-South Luzon Expressway (NLEx-SLEx) Connector Road; C5 South Link of the Manila-Cavite Expressway (CAVITEx); Cavite-Laguna Expressway (CALAX); Cebu-Cordova Link Expressway (CCLEx), and Radial Road 10 (R10) spur road of the NLEx Harbor Link Segment 10.
“I think with the significant development in the right of way acquisition, we are confident that construction of the five projects can accelerate,” Mr. Lizo said.
The P45-billion capex in 2019 is a significant increase from last year’s P9-billion budget.“Last year maliit lang kasi delayed ‘yung projects [it was small because of the delay in projects]…. (We’re increasing now) kasi [because] we’re getting most of the right of way this year,” Mr. Lizo said.
He noted the continuous progress in CALAX construction, acquisition of around 80% to 90% right of way for the R10 spur road, and non-requirement of right-of-way for CCLEx are primary reasons for the massive investment.
Mr. Lizo added that construction of phase 1 of the NLEx-SLEx Connector Road is scheduled to begin by the second quarter, which will cover the España area in Manila. A section of the C5 South Link connecting to Merville is also expected to open in April.
Late last year, MPTC secured two loan deals with two sets of six local banks to fund CALAX and CCLEx projects. The P24.2-billion loan agreement for CALAX was signed last week, while the P19-billion loan deal for CCLEx is expected to be signed in February.
MPTC is the tollways unit of Metro Pacific Investments Corp., one of the three key Philippine units of Hong Kong-based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT, Inc.
Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority stake in BusinessWorld through the Philippine Star Group, which it controls. — Denise A. Valdez

Alan Alda of TV’s anti-war comedy M*A*S*H hailed for 60-year career

LOS ANGELES — Alan Alda, best known for playing a wise-cracking Army doctor on the long-running anti-war television comedy M*A*S*H, received a lifetime achievement award from his fellow actors on Sunday, celebrating a 60-year career on stage and screen.
Mr. Alda, 82, who announced in July that he had been diagnosed with Parkinson’s disease three years earlier, was presented the honor by film star and one-time-costar Tom Hanks at the Screen Actors Guild (SAG) awards dinner in Los Angeles.
“I see more than ever how proud I am to be part of our brotherhood and sisterhood of actors,” Mr. Alda said, after receiving a sustained standing ovation from his peers.
Mr. Alda is most remembered for his Emmy-winning role as the insubordinate but highly skilled Army surgeon Captain Benjamin Franklin “Hawkeye” Pierce on M*A*S*H, the landmark CBS comedy series set during the Korean War.
He wrote and directed many episodes of the show. Its 1983 series finale was watched by nearly 106 million viewers, a record that stood three decades as the largest audience for a US TV broadcast.
The New York-born performer also worked extensively on Broadway, in motion pictures and elsewhere on TV, including two seasons on NBC’s celebrated political drama The West Wing, playing a Republican US senator.
The West Wing role earned Mr. Alda his sixth Emmy Award, on top of five previous Emmys for his work on M*A*S*H. He was the first performer to win Emmys for acting, directing, and writing on the same series.
On the big screen, Mr. Alda earned an Oscar nomination for his supporting role as a real-life US senator, Republican Owen Brewster, in Martin Scorsese’s 2004 historical biopic The Aviator about mogul Howard Hughes.
Mr. Alda, however, will remain forever associated with M*A*S*H, based on the 1970 Korean War movie satire directed by Robert Altman and adapted from a novel of the same name by a real-life doctor who served in Korea.
The show centered on the antics of Hawkeye Pierce and fellow doctors and nurses of the 4077th Mobile Army Surgical Hospital — MASH for short — as they struggled to keep their sanity and save lives. When not tending to waves of wounded GIs, Hawkeye and his pals passed their time playing practical jokes, carousing with nurses, and drinking to excess.
A far cry from several military sitcoms that came before it, M*A*S*H went beyond poking fun at Army life to deal with such issues as circumstantial ethics and the morality of war.
Premiering in September 1972 as America was still embroiled in Vietnam, M*A*S*H struggled in the ratings during its first season before catching on with viewers, lauded by critics and resonating with the anti-war sentiment of the time. It ran about eight years longer than the Korean conflict. — Reuters

Panasonic PHL sees slowdown in 2019 sales

By Zsarlene B. Chua, Reporter
THE Philippine unit of Japanese electronics company Panasonic Corp. expects a slowdown in growth this year, amid concerns over the government’s proposal to rationalize fiscal incentives as part of the tax reform program.
“Honestly speaking, the growth percentage might slightly slow down compared to previous years but we’re still growing,” Masaru Toyota, vice-president for sales at Panasonic Manufacturing Philippines Corp. (PMPC), told BusinessWorld during the launch of the company’s new line of home appliances at Conrad Hotel, Pasay City on Thursday.
In the first semester (April to September) of its fiscal year 2018, the listed company reported its sales grew by 10% to P5.86 billion versus P5.31 billion during the same period in 2017. It attributed this growth to the 114% and 128% rise in sales of consumer and business-to-business products, respectively.
However, PMPC reported its net income dropped 51% to P73.74 million due to a 3.5% rise in cost of sales ratio, lower sales and continued peso devaluation.
Mr. Toyota said the sales growth last year was due to the popularity of Panasonic refrigerators and air conditioners.
He said taxes are a key issue “but compared to other countries, the Philippines is still keeping a very high growth ratio.”
Despite the expected slowdown, Mr. Toyota said Panasonic remains bullish on the Philippines as the company will start locally manufacturing low-frost refrigerators and fully-automated washing machines.
PMPC, which has plants in Taytay, Rizal and Sta. Rosa, Laguna, currently produces window-type air conditioners and select product lines of refrigerators, washing machines and electric fans.
Mr. Toyota said the company will also push its beauty care line which was introduced last year, and includes Panasonic pore cleansers, hair dryers and facial steamers.
“For the moment [this segment] is not popular enough but I feel there’s a big potential so this year, we’ll really strongly promote this category,” he said.

Jackson docu puts star back under microscope

MICHAEL JACKSON, whose music remains ubiquitous nearly a decade after his death, is under fresh scrutiny.
The singer’s alleged sexual crimes are being re-examined in a four-hour documentary that screened Friday at the Sundance Film Festival. The movie, Leaving Neverland, was shown under police presence, an unusual circumstance for the festival.
During breaks from the screening, critics suggested that the allegations — based on accounts from Mr. Jackson’s accusers — may be explosive. The documentary is slated to air on HBO later this year.
“It’s so sexually explicit that counselors are in the lobby,” Mara Reinstein, film critic at Us Weekly, said on Twitter.
For the music industry, the documentary brings a fresh test of how to deal with controversial artists. Earlier this month, Sony Corp.’s RCA label scrubbed R. Kelly from its lineup. The R&B singer was also the subject of a high-profile documentary, which included accounts of alleged sex crimes.
In the case of Mr. Jackson, the stakes may be higher. He’s one of the best-selling artists of all time and remains a staple of streaming services.
The artist’s estate has sought to quash Leaving Neverland, and his official Twitter account slammed HBO for agreeing to air the film. “In 1992, Michael gave HBO their highest-rated special ever,” the tweet read. “Now, to repay him they give a voice to admitted liars.”
The director intentionally avoided interviewing people who spent significant time with Mr. Jackson and could have stated that he treated children with respect, Jim Bates, a spokesman for the estate, said in an e-mailed statement on Saturday. — Bloomberg

Nissan is said to face SEC probe in US over executive salary

LEAN S. DAVAL, JR.

THE Securities and Exchange Commission (SEC) is investigating whether Nissan Motor Co. accurately disclosed its executive pay in the US, according to several people familiar with the matter, compounding the car maker’s woes as it grapples with the aftermath of former chairman Carlos Ghosn’s arrest.
The US financial regulator is examining whether Nissan’s executive-pay disclosures were accurate and whether the car maker maintained adequate controls to prevent improper payments, the people said, asking not to be identified because the probe hasn’t been disclosed publicly.
Nissan, in response to questions, confirmed it has received an inquiry and said it is cooperating fully. Through a spokeswoman, Kristina Adamski, the company said it could not provide further details. Nissan shares fell as much as 2.7 percent in Tokyo trading, their biggest intraday decline in three weeks.
The SEC investigation adds to scrutiny surrounding Japan’s second-largest automaker and its executives after Japanese authorities arrested Ghosn and another company director, Greg Kelly, in November. Both men were indicted there over allegations Ghosn under-reported his income at Nissan by tens of millions of dollars. The car maker — whose largest shareholder is French alliance partner Renault SA — also has been indicted, a step that allows prosecutors in Japan to lay formal charges.
Ghosn and Kelly were arrested after a months-long internal investigation at Nissan uncovered what the company said were financial misdeeds by Ghosn. Both men deny wrongdoing.
The SEC inquiry, launched out of its Washington headquarters, is focused on whether lapses by Nissan in reporting on its executives’ pay violated US securities law, one of the people said. The regulator’s work was slowed by more than a month of partial US government shutdown, another said.
While the SEC’s civil inquiry is in its early stages and may not point to wrongdoing, it adds a layer of complexity for Nissan and the two former executives. The SEC, which often works closely with law enforcement, could seek financial penalties and injunctions to prevent violation of laws or SEC rules.
John Nester, a spokesman for the SEC, declined to comment.
Aubrey Harwell, Jr., an attorney for Kelly, said his client hasn’t received an SEC subpoena and declined further comment. US- and Japan-based representatives for Ghosn declined to comment.
In a memo to staff last month, Nissan Chief Executive Officer Hiroto Saikawa, who succeeded Ghosn as CEO, said oversights in the company’s corporate governance “permitted the situation to continue, which clearly calls for grave reflection.”
Nissan shares trade in the US via American Depositary Receipts, which generally gives the SEC enforcement authority. US courts have disagreed about whether the regulator has jurisdiction in certain cases where wrongdoing occurred abroad. The activities under scrutiny at Nissan to date took place mostly in Japan and Europe. But the SEC believes it has authority in this instance, according to one of the people familiar with the matter.
Japanese authorities have accused Ghosn and Kelly of colluding over several years to under-report Ghosn’s deferred retirement pay. Ghosn, who gained near-mythic status in the auto business for rescuing Nissan and forging a global alliance between it and Renault, also was indicted in relation to a decision to temporarily transfer personal trading losses to Nissan. He remains in custody.
Meanwhile, signs of discord are emerging between the two countries where the scandal is playing out. French President Emmanuel Macron, whose government is the most powerful shareholder in Renault, told Japanese Prime Minister Shinzo Abe on Friday that he’s worried about Ghosn’s conditions in jail, making his strongest comments yet on the fallen car titan and the scandal that has rocked the two-decade old alliance.
Japan’s Chief Cabinet Secretary Yoshihide Suga said Monday that due process is being followed in Ghosn’s detention and investigation.
Renault also was headed by Ghosn until his resignation last week. The French car maker last week named Michelin CEO Jean-Dominique Senard as its chairman.
Kelly, the only American on Nissan’s board, was known inside the company as the “CEO whisperer” for his close ties to Ghosn during his leadership tenure. A Tennessee resident, Kelly was released on bail last month but must remain in Japan pending trial as a condition of his release. — Bloomberg

Legendary French composer Michel Legrand, 86

PARIS — French composer and pianist Michel Legrand has died at 86 after a career in which he stood out for soundtracks in screen musicals with Catherine Deneuve and that won him three Oscars.
The artist died earlier on Saturday, according to a message posted on his Facebook page by his management company City Lights.
“A composer of genius, his unlimited talent, celebrated all over the world, brought such emotion. This morning we are all humming a song of Michel Legrand,” France’s Culture Minister Franck Riester said on Twitter.
Born in 1932 in Paris and son of conductor and composer Raymond Legrand, he trained at a music conservatory in the French capital before starting his career as a musician and songwriter with popular singers like Maurice Chevalier.
He rose to fame in the 1960s by turning to film scores, notably teaming up with director Jacques Demy for a series of musicals, including The Umbrellas of Cherbourg (Les Parapluies de Cherbourg) that was awarded the top-prize Palme d’or at the Cannes festival in 1964.
Mr. Legrand described the scepticism surrounding the future Cannes winner, in which a cast led by a young Catherine Deneuve sing their dialogue rather than songs in the traditional style of musicals.
“Jacques and I had to work really hard to get this project off the ground,” Mr. Legrand said in remarks on his official website.
“The producers showed us the door saying: ‘You’re a couple of nice young guys, but do you really think that people will spend an hour-and-a-half listening to characters singing life’s little platitudes!’”
Mr. Legrand worked with Mr. Demy and Ms. Deneuve in more screen musicals, while also collaborating with other rising stars of French cinema like Jean-Luc Godard and Claude Lellouch.
He soon established his name in the United States by working with jazz stars like Miles Davis and Stan Getz, and penning music for Hollywood films.
He was feted with three Oscars.
In 1968, he won the best original song prize for “The Windmills Of Your Mind” which featured in the soundtrack to The Thomas Crown Affair. Three years later he claimed the best soundtrack award for the film The Summer of ’42, before winning the best score prize again for Yentl starring Barbra Streisand in 1983.
Mr. Legrand had continued his career in recent years as a concert performer and had been due to go on tour in France this year. — Reuters

Growing logistics sector provides opportunities for property firms

By Vincent Mariel P. Galang
PHILIPPINE PROPERTY developers should advantage of the continued growth of the logistics sector this year.
During a panel discussion for the 2019 report of the Emerging Trends in Real Estate for Asia Pacific on January 16, Raoul A. Villegas, executive director for deals and corporate finance of PricewaterhouseCoopers (PwC), said the logistics sector is projected to grow by 20% to 25% this year.
“I am also very bullish about logistics, particularly how it relates to warehousing, but more specifically is cold storage warehousing. The reason why cold storage warehousing is very significant it’s because our country lacks a viable cold chain… and that’s one of the reasons why the food that comes to the market is more expensive than… in other cities,” he noted during the discussion.
DoubleDragon Properties Corp. Chief Investment Officer Hannah Yulo noted there is no major player in the industrial warehouse sector, which is why DoubleDragon is planning to build a chain of industrial complexes around the country.
“Cold storage facilities… those are one of our ideal locators for CentralHubs. So, our CentralHub warehouses, these are actually meant for… cold storage, light manufacturing, e-commerce facilities, and other logistics centers… There is no really major player… in the industrial warehouse space. A lot of these warehouses you see today are very segmented, so… you’ll have to talk to so many landlords… for their warehouse facilities,” she said during the panel discussion.
“That’s really what we are trying to consolidate this type of businesses,” she added.
DoubleDragon entered the industrial leasing business when it set up CentralHub Industrial Centers, Inc. It currently has two CentralHubs in Tarlac and Iloilo City. DoubleDragon aims to have eight CentralHub sites by 2020, with two each in North Luzon, South Luzon, Visayas, and Mindanao.
“I am very, very bullish particularly in the industrial warehouse sector… we want to get to about 100,000 square meters (sq.m.)… in particular, if you noticed in the Philippines, it is actually an emerging trend. Everywhere else in Asia, it’s an established sector, but in the Philippines, it seems to have been forgotten,” Ms. Yulo said.
“We in DoubleDragon are very bullish about this sector. We want to be the largest in the Philippines to provide this kind of facility especially with the emerging e-commerce sector,” she added.
OTHER GROWTH AREAS
Developers should also consider expanding into dormitories catering to students and workers.
“Great thing about this population (Philippine population), not only is it… a consuming population there is also a working population, so that is going to be contributing to our economic output… our population is replenishing itself unlike other countries, for example Japan… where populations are shrinking,” Mr. Villegas noted. “Because of the traffic, the demand is going to increase.”
Philippines Urban Living Solutions, Inc. (PULS) operates a chain of dormitories under the brand name MyTown. Property giant Ayala Land, Inc. (ALI) also opened The Flats Amorsolo, which features co-living spaces catering to young professionals, in Makati City.
Tourism projects are also being pursued by many property firms.
Augusto Cesar D. Bengzon, chief financial officer of Ayala Land, Inc. (ALI), said the company is expanding its footprint in the tourism sector to take advantage of the boom in domestic travel.
“We’re quite bullish on the tourism sector. When we put up our own hotel brand eight years ago, we were originally thinking about Seda, which is the brand that would cater to the foreign tourists… but I think the bigger number that the people do not see is the number of domestic tourists… 95 million domestic tourists. We’re seeing that in our hotels during the weekdays… we all know about ‘staycation’ phenomenon and that’s being driven by local tourists… and we expect domestic tourists to continue to rise,” Mr. Bengzon said.
Seda is a hotel brand under Ayala Land Hotel and Resorts Corp, (AHRC), subsidiary of Ayala Land, Inc. (ALI). It is currently present in Bonifacio Global City, Cagayan de Oro, Davao City, Nuvali in Laguna, Iloilo, Quezon City, Bacolod, Cebu, and Palawan.
Mr. Bengzon also shared ALI’s vision for sustainable tourism. The property giant is undertaking an aggressive carbon-neutral program that will offset the projected 490,000 tons of carbon emissions from its commercial properties by 2022.

CTA affirms cancellation of P1.8-B tax assessment vs Cebu Air

CEBU AIR, Inc. operates Cebu Pacific and Cebgo in the Philippines. — BW FILE PHOTO

THE Court of Tax Appeals (CTA) upheld an earlier decision cancelling the P1.8-billion tax assessment against Cebu Air, Inc. over improperly accumulated earnings tax for 2010.
In a resolution dated Jan. 23, the CTA Special Second Division affirmed its Sept. 27, 2018 decision cancelling and withdrawing the tax assessment issued by the Bureau of Internal Revenue (BIR).
The CTA Special Second Division said the arguments raised by the BIR in its motion for reconsideration were “a mere of the same facts and issues” which were already discussed in its previous decision.
“Considering the foregoing, there is no cogent reason to disturb the assailed Amended Decision,” the CTA ruled.
In its appeal, the BIR said Cebu Air had “failed to prove it declared and paid cash dividends to its shareholders.” It added that retained earnings should only be up to 100% of the paid-up capital to consider it “reasonable” for the needs of business.
The BIR also said a compromise penalty should have been imposed on the operator of Cebu Pacific.
According to the Tax Code, improperly accumulated earnings tax should apply to corporations that have avoided income tax “with respect to its shareholders… by permitting earnings and profits to accumulate instead of being divided or distributed.”
In the amended decision last September, the CTA said that Cebu Air sufficiently proved that it declared cash dividends within one year from the close of 2010, through the submission of audited financial statements, monthly remittance return of final income taxes withheld, among others.
“Taking into consideration the cash dividends declared seasonably within the 1-year period from the end of the taxable year being assessed (i.e., CY 2010), petitioner will no longer have improperly accumulated earnings for TY 2010,” the court said.
The BIR had argued that the additional paid-in capital (APIC) is part of paid-up capital and that the amount that a corporation should retain should only be up to 100% of its paid-up capital or the amount representing the corporation’s shares of stocks. Any amount that exceeded 100% of the paid-up capital is considered unreasonable for the need of the business and should be subjected to tax.
The CTA, however, emphasized its decision that the additional paid-in capital, the amount of capital in excess of the par value of the company’s shares, “are not earnings/profits of a corporation generated from the normal and continuous operations of the business.”
The resolution was penned by Associate Justice Juanito C. Castañeda, Jr. and concurred in by Associate Justice Catherine T. Manahan. — Vann Marlo M. Villegas

AHR pours P1.5 billion into Astoria Palawan

Astoria Hotels & Resorts (AHR) has spent P1.5 billion so far for the on-going development of Astoria Palawan in Puerto Princesa City.
In a statement, the local hotel chain said the funds were used to expand Astoria Palawan’s villas, food and beverage outlets, and its waterpark.
Astoria Palawan added 30 new premier villas that have access to the Sulu Sea beachfront, which brings to 146 the eco-resort’s total number of rooms. The company has once again partnered with Cebu-based architect Ed Gallego, and with interior design firm Atelier Almario for the design of the villas.
A new food and beverage outlet, The Pavilion, is set to open within the first quarter.
Palawan Waterpark by Astoria now features a wave pool, water slides, and a lazy river, among others.
“This investment is proof of our belief in the continued growth of foreign tourists, our commitment to develop the countryside as part of our nation building efforts, and to make a positive impact on human capital by providing avenues for gainful employment to our fellow Filipinos,” Jeffrey T. Ng, president of AHR, said in a statement.
Mr. Ng noted Palawan is expected to attract more tourists after being named by New York-based magazine Travel + Leisure as the “World’s Best Island” in 2017, while Puerto Princesa’s Underground River was included in the New 7 Wonders of Nature in 2011.
As part of its corporate social responsibility projects, Astoria Palawan recently hosted a Sikap Pinoy event on financial education for farmers and fisherfolk. The hotel also directly buys fresh catch of fishermen and vegetables from local farmers at fair prices.
“By investing and building relationships with the local community, in the end we deliver outstanding experiences for our guests at Astoria Palawan,” Mr. Ng said.
AHR has eight properties in top destinations in Metro Manila, Palawan, and Boracay. — Vincent Mariel P. Galang

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