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Phl-Sokor trade seen to hit $20 B in 5 years

General

Jan 202015

Phl-Sokor trade seen to hit $20 B in 5 years

MANILA, Philippines – The Philippines and South Korea have the potential to grow bilateral trade to over $20 billion over the next five years through greater cooperation. “I think if we try very hard and if we improve the (business) environment, it will not be difficult for us to see two-way trade to surpass $20 billion in the near future… within five years,” South Korean Ambassador to the Philippines Lee Hyuk told reporters during the Philippines-Korea Economic Council (Philkorec) Induction of Officers and new members. Two-way trade between the Philippines and South Korea amounted to around $12 billion last year. For the countries’ bilateral trade to breach $20 billion in the next five years, Lee said both parties would have to work together in terms of promoting each other’s manufactured goods and services. Apart from increasing bilateral trade, Lee said there are also opportunities to increase South Korean firms’ investments in the Philippines. “But this will only be if there is an improved environment for investment, so we want the Philippine government to improve investment environment for foreign companies,” he said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 For his part, Philkorec chairman Gerardo Garcia told reporters the council plans to organize inbound missions of Korean firms to the country, as well as outbound missions of Philippine firms to South Korea, to promote greater trade and investment relations between the two countries. The missions would be organized with business groups such as the Philippine Chamber of Commerce and Read More …

Phl urged to seek more climate change solutions

Economy

Jan 192015

Phl urged to seek more climate change solutions

MANILA, Philippines – The World Wide Fund for Nature (WWF) urged authorities to discuss more climate solutions following the recent visit of Pope Francis. The Philippines is the third most vulnerable country to climate change, a tropical archipelago besieged by no less than 20 storms yearly, the environmental group said. The group cited Super Typhoon Haiyan (Yolanda) which left at least 6,000 dead and caused over $14 billion in economic damage. “With impacts ranging from stronger typhoons, floods, droughts to forced migration, climate change is a reality that millions of Asians have had to face early. Whether or not the Philippines is a major carbon emitter is beside the point. Many countries which contribute the least to global carbon emissions are the most vulnerable, having fewer resources to cope with disasters,” the group said. As such, the group called on authorities to craft out more proactive – rather than reactive – climate solutions. The Philippine climate adaptation efforts include a four-year, 16-city study to prepare the largest Philippine cities for climate impacts, it said. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The group predicts that the Philippines’ global emissions will increase beyond the current 0.35 percent due to economic and population growth coupled with rapid urbanization. “The world must learn from Typhoons Ondoy, Sendong and Haiyan – lessons paid for in lost lives and livelihoods,” said WWF-Philippines Climate Change and Energy Program head Angela Ibay. She said the Pope’s recent visit to Tacloban shows that the Church cares Read More …

Gov’t set to award Southwest terminal

Economy

Jan 192015

MANILA, Philippines – The government is set to award its first public private partnership (PPP) project for 2015 as the Department of Transportation and Communications (DOTC) is scheduled to announce the winning bidder for the P2.5-billion Integrated Transport System – Southwest Terminal within this week. DOTC Undersecretary Jose Perpetuo Lotilla said the agency is set to announce the winner for the transportation hub to be situated at the Coastal Road Terminal along the Manila – Cavite expressway (Cavitex) after a careful evaluation of the bids submitted by MWM Terminals led by Filipino-owned Megawide Construction Corp. and Filinvest Land Inc. of taipan Andrew Gotianun. “Yes we hope to do that this week,” Lotilla said. MWM Terminals submitted an annual grantor payment (AGP) of P100 million while Filinvest Land offered an annual grantor payment of P650 million. DOTC spokesperson Michael Arthur Sagcal earlier explained that AGP are payments to be made by the government to the concessionaire. “Lowest AGP wins, subject to evaluation of the bid,” Sagcal said. A total of 16 companies bought prequalification documents for the PPP project but only Filinvest Land and MWM Terminals submitted qualification documents last Dec. 22. Other companies are San Miguel Corp., Ayala Corp., Ayala Land Inc., Metro Pacific Tollways Corp., Robinsons Land Inc., D.M. Wenceslao and Associates Inc., Vicente T. Lao Construction, French-owned Egis Projects Philippines, Megaworld Corp., State Properties Corp., Expedition Properties Corp., MGS Construction Inc., Altus San Nicolas Corp. and Tutuban Properties. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The Read More …

Moody’s upgrades global airline outlook to positive

Economy

Jan 192015

Moody’s upgrades global airline outlook to positive

MANILA, Philippines – Moody’s Investors Service has upgraded its outlook on the global airline industry to positive from stable as the sharp drop in fuel costs is expected to bolster financial performance of major players. Moody’s expects the operating profit margins of the industry to settle at 12 percent to 14 percent this year and 11.5 percent to 13.5 percent next year, instead of the estimated 8.5 percent to 9.5 percent for 2014. “US carriers will continue to garner the largest increases, leading to stronger performance relative to airlines based in increasingly competitive developing markets, and in Europe,” Moody’s vice president and senior credit officer Jonathan Root said. In a report titled “Lower Fuel Costs to Boost Operating Profit Margins; Yield Growth Still Constrained,” Moody’s said the outlook reflects expectations for the fundamental business conditions in the industry over the next 12 to 18 months. Passenger demand would also increase due to steady economic growth, higher disposable incomes and rising air travel in developing economies. Passenger demand, which is measured as revenue passenger kilometers (RPKs), is estimated at five percent in 2015 and six percent in 2016. Yields are forecast at flat to two percent in 2015 and one percent to three percent in 2016. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 Despite the slower yield growth, Moody’s said its profit margin and RPK forecasts support a positive outlook. With the average price of jet fuel declining $1 per gallon or more in 2015, Moody’s pointed out that Read More …

Index eases as market joins reg’l downtrend

Economy

Jan 192015

Index eases as market joins reg’l downtrend

MANILA, Philippines – The local benchmark index took a step back yesterday following last week’s ascent as it joined the downtrend in the region. The Philippine Stock Exchange index (PSEi) ended almost flat, slipping 0.07 percent or 5.56 points to close at 7,485.32. The All Shares index, meanwhile, moved on the other direction, inching up 0.19 percent or 8.36 points at 4,384.61. “The local market rejoined its peers in the region after staying shut for most of last week. Results were mixed with Japanese indexes higher, drawing on a yen strengthened by investors seeking safer havens in light of a drop in Chinese stocks,” said Justino Calaycay Jr., analyst at Accord Capital Equities Corp. “Playing catch-up, prices retreated off last week’s close with the index easing off this year’s second all-time record,” Calaycay said. Local counters were mixed at three apiece. Counters in the green were led by mining and oil firms which picked up 1.10 percent while those in the red were headed by the services firms which declined 0.77 percent. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 Market breadth stayed in the positive territory as advancers edged out decliners, 93 to 85, while 42 stocks did not change. Value turnover, however, thinned to P8.06 billion from last Wednesday’s P13.45 billion. “The PSEi, even as it retraced some of its steps, remains close to record. Developments overseas dictate that we even tighten the lid a bit more,” Calaycay said.

Low oil prices, strong $ won’t dent OFW inflows

General

Jan 192015

Low oil prices, strong $ won’t dent OFW inflows

MANILA, Philippines – The declining oil prices and the strengthening dollar are not expected to put a dent on the steady flows of remittances to the Philippines, a Bangko Sentral ng Pilipinas official said. BSP Deputy Governor Diwa C. Guinigundo told reporters that overseas Filipino workers usually have a fixed amount they send home, thus, they tend to remit more whenever the dollar is stronger or less when the greenback is weaker. “They need to maintain the peso value of their remittances. Their expenses are in peso. I think that’s the psyche of most OFWs (and) we see this in the data,” Guinigundo said. Latest central bank data showed cash remittances increased two percent to $2.122 billion in November from $2.08 billion in the same month in 2013. This brought the 11-month figure to $21.911 billion, up 5.7 percent from the $20.796 billion a year ago. On the declining oil prices, Guinigundo said that oil-producing firms in the Middle East are not seen cutting jobs so this should not have a significant effect on remittances. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 “They didn’t bring down production, (and besides) it’s harder to lay off people than rehire them. These companies can operate at a loss. They would rather absorb the cost of transition rather than absorb the cost of rehiring,” Guinigundo said. The Organization of Petroleum Exporting Countries in November has kept its output target unchanged, further sinking oil prices in international markets. Asian benchmark Dubai crude has Read More …

Gov’t borrowings down

Economy

Jan 182015

MANILA, Philippines – Government borrowings slightly declined in the first 11 months of 2014 due to lower borrowings from the domestic market. Based on data from the Department of Finance, the government borrowed P330.72 billion from January to November 2014, down from P333.25 billion a year ago. Of the total amount, P235.12 billion was sourced locally mainly through the sale of treasury bonds. The amount marked a 53.8 percent drop from the P509.28 billion recorded in the 11 months ending November 2013. On the other hand, foreign borrowings, done largely by tapping loans from development lending institutions, grew more than three-fold to P95.6 billion. Debt secured from foreign lenders was in the form of P55.34 billion in program loans and P11.59 billion in project loans aimed at supporting post-Yolanda relief and recovery initiatives. The government borrows to pay maturing obligations and plug the deficit in its budget. The higher the fiscal deficit, the higher will be the borrowing requirements of the government. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 In November alone, borrowings by the government increased to P33.9 billion from P31.52 billion. Debt incurred from the domestic market went up to P33.28 billion from P30.65 billion. The country’s outstanding debt rose to P5.72 trillion as of the end of November last year due to higher domestic obligations. A big chunk of this amount or 66 percent was accounted for by peso-denominated liabilities while the balance of 34 percent comprised debts denominated in foreign currencies. The government has Read More …

PSE slates Japan roadshow

Economy

Jan 182015

MANILA, Philippines – The Philippine Stock Exchange (PSE) is holding a roadshow in the Land of the Rising Sun this month to court Japanese firms to list in the local bourse. The PSE said it would hold a Philippine Business Environment Seminar in Tokyo on Jan. 21 to provide executives of around 150 Japanese firms with an overview of the condition and outlook of the Philippine economy and its business sector. The roadshow is seen as a venue to discuss the listing structure and rules of the bourse to encourage Japanese firms with Philippine subsidiaries to list at the PSE, the operator of the country’s only stock exchange said. “Quite a number of Japanese companies have offices and facilities in the Philippines and we would like to apprise them of the developments in our capital markets as well as urge them to tap the Exchange for funding requirements,” PSE president and chief executive officer Hans B. Sicat said. Philippine Business Environment Seminar in Tokyo will be undertaken by the PSE together with Takara Printing, The International Friendship Exchange Council, KPMG Japan, KPMG Philippines, and Mori Hamada & Matsumoto Law Office. Aside from the Philippine Business Environment Seminar, the PSE said it will also host a Philippine Corporate Day on Jan. 22 and 23 in partnership with DBP-Daiwa Capital Markets Philippines Inc. in which representatives of participating Philippine-listed companies will meet with 25 investment firms in Japan. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 The roadshow will highlight the Read More …

SSI ramps up expansion of specialty stores

General

Jan 182015

SSI ramps up expansion of specialty stores

MANILA, Philippines – Tantoco-led SSI Group Inc. intends to continue its aggressive store expansion this year, earmarking P1.5 billion to cement its position as the country’s largest specialty store retailer. SSI vice president for investor relations Marti Atienza told The STAR that the listed retailer is earmarking P1.5 billion for capital expenditures (capex) this year, nearly the same level of spending it had last year. Atienza said the capex would be used to add around 130 new stores to its network. The company is funding this year’s capex through the P7.45 billion it raised from an initial public offering (IPO) in November last year. SSI is currently in the process of expanding its store network as it seeks to capitalize on favorable market conditions, evolving consumption patterns and consumer tastes and the availability of prime retail space in new and existing mall developments. As of end-June last year, SSI had 655 specialty stores in 68 major malls across the country. Business ( Article MRec ), pagematch: 1, sectionmatch: 1 Atienza said the firm has already spent P1.3 billion in expanding its store network in the first nine months of 2014, adding a total of 87 new stores or an additional of 23,000 square meters of retail space. SSI is the country’s leading specialty store retailer, operating more than 100 international brands which includes Hermès, Prada, Gucci, Burberry, Salvatore Ferragamo, Lacoste, Michael Kors, Kate Spade, Gap, Old Navy, Zara, Stradivarius, Bershka, Aeropostale, Samsonite, Nine West, Payless Shoe Source, Beauty Bar, Marks Read More …

What happened to the Swiss franc?

Economy

Jan 162015

NEW YORK — One of the world’s safest investments — the Swiss franc — has swung wildly this week after the central bank in Switzerland announced it would scrap its policy of limiting the rise of the currency. It may seem like an arcane move, but it’s not. The Swiss National Bank’s surprise decision on Thursday caused the franc to surge against the euro and dollar, sending shockwaves through the global financial system. Holders of Swiss francs profited handsomely, but many investors and brokerage firms, were pounded with losses. Two brokerage firms in London and New Zealand’s have announced huge losses and will have to close. A New York-based currency broker said clients suffered significant losses, and it needed an emergency loan to stay in business. The turmoil is all the more unsettling because, like U.S. bonds, the dollar and gold, the Swiss franc has been viewed as a haven for investors, thanks to the stability and wealth of the Swiss government. Here’s what happened to the franc and why it matters: How did we get here? Business ( Article MRec ), pagematch: 1, sectionmatch: 1 Since 2011, the Swiss National Bank has had a program to keep its franc from appreciating too much against other currencies — most importantly the euro, says Ian Gordon, a currency strategist with Bank of America Merrill Lynch. The franc’s rapid rise makes goods and products produced in Switzerland more expensive and less competitive in other countries. The bank set a limit of 1.20 Read More …

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