business news – Page 35 – Author Carlo Carrasco

Improving foreign investment outlook for Philippines seen

September 12, 2024September 4, 2024carlocarrasco

As far as analysts are concerned, the foreign investment outlook for the Philippines is improving and should result in more investments, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

LOWER INTEREST RATES will help drive the entry of more foreign direct and portfolio investments into the Philippines, analysts said.

“The outlook for foreign direct investment (FDI) and foreign portfolio investment (FPI) in the Philippines appears promising, with current trends suggesting the country could meet or potentially exceed the Bangko Sentral ng Pilipinas’ (BSP) targets,” Security Bank Corp. Chief Economist Robert Dan J. Roces said in a Viber message.

The BSP expects to record FDI net inflows of $9.5 billion this year. For foreign portfolio investments, it forecasts $3.1 billion in net inflows by yearend.

“The BSP’s forecast for the year sounds reasonable, as it wouldn’t be too far a stretch, with that sort of level of annual FDI coming into the Philippines almost consistently over this period, barring the coronavirus-hit year in 2020,” Pantheon Macroeconomics Chief Emerging Asia Economist Miguel Chanco said in an e-mail.

In the January-to-May period, FDI net inflows jumped by 15.8% year on year to $4.024 billion, data from the BSP showed.

Meanwhile, short-term foreign investments yielded a net inflow of $1.46 billion in the January-July period, surging from the $157.3-million net inflows in the same period a year ago.

FDIs are considered long-term investments, while portfolio investments or “hot money” are seen as more fickle due to the ease by which these funds enter and leave the economy.

Ruben Carlo O. Asuncion, chief economist at Union Bank of the Philippines, Inc., said the BSP’s investment targets are doable amid easing interest rates.

“Offering attractive rates will be the key. All around will be declining key rates, thus, offering sensible investments now will lock in gains for prospective investors. I would like to believe that there is time,” he added.

Mr. Roces said the further reduction in policy rates this year and next year “should stimulate investment activity, particularly for FDI, by making borrowing more attractive.”

At its August meeting, the Monetary Board cut rates for the first time in nearly four years or since November 2020. It reduced borrowing costs by 25 basis points (bps), bringing the benchmark rate to 6.25% from the previous over 17-year high of 6.5%.

The central bank could also deliver another 25-bp rate hike in the fourth quarter, BSP Governor Eli M. Remolona, Jr. said earlier.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you agree with the findings of the economic analysts pointing to improving foreign investment outlook for the nation?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Sharp donates equipment to Las Piñas City Government

September 9, 2024August 31, 2024carlocarrasco

Recently in the City of Las Piñas, , Sharp Philippines Corporation met with Mayor Imelda Aguilar and formally donated several pieces of laundry equipment to the City Government at City Hall, according to the official announcement via social media. The equipment will be deployed in various evacuation centers across the city.

To put things in perspective, posted below is an excerpt from the City Government’s announcement. Some parts in boldface…

Sharp Philippines Corporation officially turned over 11 units of laundry equipment to the Las Piñas City Government in a ceremonial event on Thursday, August 15 at the City Hall. The donation, which includes five washers, five dryers, and one twin tub washing machine, is intended to support the Disaster Risk Reduction Management Office in providing clean clothes for residents in evacuation shelters, particularly during times of disaster.

City Mayor Imelda Aguilar personally received the donations, acknowledging Sharp’s significant contribution to the city’s disaster preparedness efforts. The event marks Sharp’s milestone of producing 11 million washing machines, reinforcing their commitment to social responsibility and community welfare.

Let me end this piece by asking you readers: If you are a resident of Las Piñas City, what is your reaction to this development? Are you delighted to see a private corporation like Sharp Philippines donate equipment that can help displaced residents over their essential laundry needs during emergencies? Do you wish more corporations will come to Las Piñas to donate useful equipment?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Philippines inflation slows down to 3.3%

September 8, 2024September 6, 2024carlocarrasco

Inflation in the Philippines went down to 3.3% this past August, according to a Philippine News Agency (PNA) news article.

To put things in perspective, posted below is an excerpt from the PNA news article. Some parts in boldface…

Headline inflation slowed to 3.3 percent in August this year from 4.4 percent in July due to the decrease in food inflation, the Philippine Statistics Authority (PSA) said.

In a briefing Thursday, National Statistician Dennis Mapa said the headline inflation last month was also lower than the 5.3 percent recorded in August 2023.

The latest data brought the year-to-date headline inflation to 3.6 percent which is within the government’s 2 to 4 percent target.

Mapa said the downtrend in the overall inflation in August was primarily brought about by the slower annual increment of food and non-alcoholic beverages at 3.9 percent from 6.4 percent in July.

In particular, food inflation eased to 4.2 percent from 6.7 percent.

The reduction was due to the decline in rice inflation which went down to 14.7 percent from 20.9 percent in July. It was the lowest rice inflation recorded since the 13.2 percent recorded in October 2023.

Rice inflation is expected to go down to a single-digit level this month due to base effects, Mapa said.

Vegetables, tubers, plantains, cooking bananas, and pulses meanwhile, which recorded a year-on-year decline of 4.3 percent in August from 6.1 percent increase in July, also contributed to the slowdown in food inflation.

Lower inflation rates were likewise noted in flour, bread, and other bakery products, pasta products and other cereals, 2.4 percent from 2.6 percent; meat and other parts of slaughtered land animals, 4.0 percent from 4.8 percent; and ready-made food and other food products not elsewhere classified, 5.5 percent from 6.0 percent.

Core inflation meanwhile, which excludes selected food and energy items, slowed down to 2.6 percent in August 2024 from 2.9 percent in the previous month.

In a separate statement, the National Economic and Development Authority (NEDA) said the continued easing of inflation and stable prices would significantly benefit households and businesses and will promote increased consumer spending and stimulate economic activity.

“The sustained easing of inflation will support growth in household consumption, which elevated prices have long suppressed. Low-income households will benefit from the decline in food inflation, as food constitutes more than half (51.4 percent) of the consumption of the bottom 30 percent of households,” NEDA Secretary Arsenio Balisacan said.

“Moreover, as businesses have identified persistent inflationary pressure as a significant concern, the recent stability and moderation in inflation will encourage investments, especially as borrowing costs are declining. Most importantly, the appetite for business expansion will improve as consumer spending increases,” he added.

Balisacan noted however that while inflation continues to trend downward, primarily due to reduced import tariffs on rice, potential pressures could emerge from higher electricity rates and above-normal weather disturbances.

“The government is prepared to address these pressures to ensure stable inflation. Preparations to counter the effects of the La Niña phenomenon are underway, including improvements in early warning systems, the utilization of communication systems to issue warnings about dam openings, measures to address the potential accelerated speed of livestock diseases, and greater involvement of local government units in information dissemination, are in progress. Notably, the government has allocated PHP15 billion for national risk reduction in 2024,” Balisacan said.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you think that inflation won’t hit 4% over the remaining months of the year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Filinvest Hospitality Corp. makes big bet on Philippine tourism

September 6, 2024September 1, 2024carlocarrasco

Filinvest Hospitality Corp. (FHC) announced that it is betting big on Philippine tourism with its newest move to add a few thousand more new rooms over the next five years to accommodate tourists, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

GOTIANUN-LED Filinvest Hospitality Corp. (FHC) is aiming to add close to 2,000 new rooms in the next five years, a company official said.

“We’re looking at adding close to 2,000 keys. It’s more about the quality of the keys and the spread as opposed to the number,” FHC First Senior Vice-President Francis Nathaniel C. Gotianun told reporters on the sidelines of the Shareholders’ Association of the Philippines’ third general membership meeting in Makati City on Tuesday.

“We’re focusing on key tourist destinations across the country. We’re working on a collection of the top spots so when we go out into the international market or even the domestic market, we can sell all the good destinations, whether that be Boracay, Palawan, Bohol, Baguio, or Cebu. We’re trying to catch them all,” he added.

FHC’s hospitality portfolio has about 1,800 keys across seven hotels, ranging from high-end five-star properties under the Crimson brand to Quest hotels and Timberland, which serve the mid-priced leisure markets.

“We’re really focusing on creating a collection of hotels in the right locations so that when we go out into the market, we can sell all the best of the Philippines,” Mr. Gotianun said.

Mr. Gotianun said that FHC is very bullish on the prospects of the country’s tourism sector. He added that the company has a couple of projects to be announced by the end of the year.

“We can really see the tourism numbers starting to come back up, very strong domestic while international is still a little bit below, but we think we’ll catch up,” Mr. Gotianun said.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you think FHC’s addition of about two thousand new rooms will help the nation’s tourism industry a lot in the years ahead? Do you think our nation still lacks rooms for domestic and foreign tourists?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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SM Investments Corporation acquiring 184 hectares of land in Muntinlupa City

August 28, 2024August 21, 2024carlocarrasco

Something significant could happen within the City of Muntinlupa in the near future as SM Investments Corporation (SMIC) is acquiring 184 hectares of land there as part of a property-for-shares swap with subsidiary Intercontinental Development Corporation (ICDC), according to a Manila Bulletin business news report.

To put things in perspective, posted below is an excerpt from the Manila Bulletin news report. Some parts in boldface…

SM Investments Corporation (SMIC), the flagship of the Sy family, is acquiring 184 hectares of land in Muntinlupa City from a nearly wholly-owned subsidiary, Intercontinental Development Corporation (ICDC), through a property-for-shares swap.

In a disclosure to the Philippine Stock Exchange, SMIC said its Board has approved the swap of SMIC with 96.75 percent-owned subsidiary ICDC, which will convey to SMIC its lands in Susana Heights, Muntinlupa City, in exchange for new SMIC common shares.

“In accordance with applicable Securities and Exchange Commission (SEC) rules and regulations, the respective Boards of Directors of the SMIC and ICDC deemed it necessary and advisable to enter into the Transaction,” SMIC said.

It added that the swap aims to optimize the properties’ utilization and development and align with their broader business strategies.

SMIC said it will increase its real estate assets through the acquisition of the properties, although the acquisition will have no material effect on its business, financial condition, or operations.

One of the country’s biggest conglomerates, SMIC, reported a 10 percent improvement in consolidated net income to P40.2 billion in the first half of 2024 from P36.5 billion in the same period last year. The firm said this reflected a 13 percent growth in net income to P21.8 billion in the second quarter.

Consolidated revenues rose five percent in the first half to P301.4 billion from P286.7 billion year-on-year and grew six percent to P157.7 billion in the second quarter.

“SM’s double-digit growth in the first half results reflects a positive environment for our businesses,” said SM Investments President and CEO Frederic C. DyBuncio.

Let me end this post by asking you readers: What is your reaction to this recent development? If you are a resident of Muntinlupa City, do you think SMIC will start a major development of the 184 hectares of land in Susana Heights?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Major property developers unfazed by national ban on POGOs

August 21, 2024August 13, 2024carlocarrasco

As far as the major property developers are concerned, the national ban on Philippine Offshore Gaming Operations (POGOs) will not have a significant effect on their and residential businesses, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

LOCAL PROPERTY DEVELOPERS are unfazed by the government’s ban on Philippine offshore gaming operators (POGO), saying that it has minimum or no effect on their office and residential businesses.

“Our direct exposure to POGO is rather limited. Only 1% of our office portfolio is occupied by POGOs,” she said.

“We were never a big POGO locator. It has even gone down over the years. Now, we’re down to 1%. In terms of our sales, we have very little sales to Chinese buyers in general, whether POGO or not,” she added.

Ms. Dy said that ALI conducted checks across its residential buildings following the announcement of the ban and found that only less than 5% are occupied by POGOs or probable POGO employees.

“Our products are not that exposed to the POGO market, either directly in the office or indirectly as tenants for our residential buildings,” she said.

Sy-led conglomerate SM Investments Corp. (SMIC) said the POGO ban also has no impact on their property business. SM Prime Holdings, Inc. develops residential and commercial properties through SM Development Corp.

“Fortunately, (the POGO ban) has no impact to us,” SMIC President and Chief Executive Officer Frederic C. DyBuncio said in a mobile phone message after being asked for comment.

In a recent disclosure, Gotianun-led Filinvest REIT Corp. (FILRT) said that it is not affected by the POGO ban. The company is the real estate investment trust (REIT) of Filinvest Land, Inc.

“FILRT has no POGO exposure and has been free of POGOs since the second quarter of 2022,” it said.

“The company has been deliberately diversifying its tenant mix, with the addition of traditional tenants and coworking locators,” it added.

Luxury property developer Shang Properties, Inc. recently said that the POGO ban will have no effect on the company’s residential business.

“The profile of our buyers is mostly Filipinos. We have a healthy mix of foreign buyers which are not China-based, so we’re not as affected,” Shang Properties Executive Vice-President for Commercial Maria Rochelle S. Diaz said at a recent media briefing.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you think that the nationwide ban on POGOs will not harm the office and residential businesses of all property developers?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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BIR expecting to collect billions from online sellers with withholding tax

August 9, 2024August 2, 2024carlocarrasco

With the 1% withholding tax on online sellers already in effect, Bureau of Internal Revenue (BIR) expects to collect billions of Pesos from the said sellers although they could not give an estimate on how much could be collected, according to a GMA Network news report.

To put things in perspective, posted below is an excerpt from the GMA news report. Some parts in boldface…

The Bureau of Internal Revenue (BIR) is expecting to collect billions of pesos in taxes from the growing e-marketplace industry after it subjected online sellers under the withholding tax system.

“Itong withholding tax on online transactions, dahil effective na ‘yan, inaasahan natin na malaki rin ang maitutulong nito,” BIR Commissioner Romeo Lumagui Jr. told reporters at the sidelines of the agency’s 120th anniversary celebration in Pasay City on Thursday.

(The withholding tax on online transactions, since this has been effective, we expect it could help immensely.)

Lumagui said the BIR cannot yet give an estimate how much it can collect from imposing withholding tax on online sellers.

“But, we’re expecting that ‘yung revenues natin diyan would be in the billions,” he said.

The BIR’s plan to impose withholding tax to merchants in e-marketplaces took effect on July 15, 2024.

Under its Revenue Regulation (RR) No. 16-2023, one-half of the gross remittances of e-marketplace operations and digital financial services providers to the sellers or merchants for goods or services paid through their platform shall be subject to a 1% creditable withholding tax.

The BIR, however, said the 1% withholding tax shall not be collected “if the annual total gross remittances to an online seller for the past taxable year has not exceeded P500,000” and “if the cumulative gross remittances to an online seller in a taxable year has not yet exceeded P500,000.”

The withholding tax is the amount withheld by a business in payments of goods or services directly remitted to the government on behalf of suppliers or employees.

The BIR defines “gross remittances” as the total amount received by an e-marketplace operator or digital financial services provider from a buyer or consumer for the goods and services sold by or paid to the seller or merchant through the platform of the e-marketplace operator.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you think the 1% withholding tax on online sellers will help the BIR collect tens of billions of Pesos more by the end of this year?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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POGO Ban would help expedite Philippines’ exit from global financial watchdog’s “gray list” related to money laundering

August 8, 2024July 30, 2024carlocarrasco

In relation to helping the Philippines recover from the many negative effects caused by Philippine offshore gaming operators (POGOs), the declared nationwide ban on POGOs will help expedite the nation’s exit from the “gray list” of a global financial watchdog that has been monitoring jurisdictions for money laundering risks, according to a BusinessWorld news report.

To put things in perspective, posted below is an excerpt from the BusinessWorld news report. Some parts in boldface…

THE RECENT BAN on Philippine offshore gaming operators (POGO) would help expedite the country’s exit from a global financial watchdog’s “gray list” of jurisdictions under increased monitoring for money laundering risks, the central bank governor said.

“With the POGO ban, we do see a drop in money laundering, which should help us exit the gray list,” Bangko Sentral ng Pilipinas (BPS) Governor Eli M. Remolona, Jr. told BusinessWorld in a text message.

Last week, President Ferdinand R. Marcos, Jr. ordered a total ban on all offshore gaming operations due to their ties to illicit activities such as financial scams, money laundering, prostitution and human trafficking.

Mr. Marcos directed the Philippine Amusement and Gaming Corp. (PAGCOR) to shutter all POGO facilities by the end of the year.

This comes after the Financial Action Task Force (FATF) in June kept the Philippines in its gray list for a third straight year.

The global watchdog said the country still needs to address three remaining action items, one of which is “demonstrating that supervisors are using anti-money laundering and counterfinancing of terrorism (AML/CFT) controls to mitigate risks associated with casino junkets.”

Mr. Remolona earlier said the Philippines would likely exit the gray list by next year as it still needs to address the remaining deficiencies cited by the FATF.

From 2018 to 2023, the Philippines was among the top five countries in Southeast Asia with money laundering activities added over the five-year period, earlier data from Moody’s showed.

The number of money laundering events added in the Philippines jumped by 45% from 2022 to 2023, it said.

Chester B. Cabalza, founding president of Manila-based International Development and Security Cooperation, said Mr. Marcos’ order to ban POGOs would encourage more “legitimate” investments to enter into the country.

“With the expected ban, the Philippines may be relieved with the gray list tag and re-strategize for fulfilling more legal and moral entertainment investments for the inclusive growth of the country,” he said via Facebook Messenger.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you think improvements will be realized gradually over the next twelve months with the ban on POGOs in effect? Do you think that money laundering and crime related to POGOs will go down sharply?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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Ban on POGOs all over the Philippines declared

July 24, 2024July 23, 2024carlocarrasco

During his 3^rd State of the Nation Address (SONA), President Ferdinand “Bongbong” Marcos, Jr., declared a nationwide ban on all Philippine offshore gaming operators (POGOs), according to a Philippine News Agency (PNA) news article. Marcos pointed out the negative effects POGOs had on the country such as money laundering, scamming, prostitution, human trafficking, kidnapping, and murder to name some.

To put things in perspective, posted below is an excerpt from the PNA news article. Some parts in boldface…

President Ferdinand R. Marcos Jr. has heeded snowballing calls to ban Philippine offshore gaming operators (Pogos) in the country, an industry marred by controversies and illegal activities.

During his third State of the Nation Address (SONA) on Monday, Marcos acknowledged that POGOs have already “ventured into illicit areas furthest from gaming, such as financial scamming, money laundering, prostitution, human trafficking, kidnapping, brutal torture, even murder.”

“The grave abuse and disrespect of our system must stop. Kailangan nang itigil ang panggugulo nito sa ating lipunan at paglalapastangan sa ating bansa (It is now imperative to stop this chaos that is wreaking havoc to our society and desecrating our country). Effective today, all POGOs are banned,” Marcos exclaimed prompting the crowd at the Batasan Pambansa in Quezon City to break into cheers.

The President also ordered the Philippine Amusement and Gaming Corporation to cease operations of POGOs by the end of the year, as well as the Department of Labor and Employment to help workers who will be displaced.

Finance Secretary Ralph Recto and Socioeconomic Planning Secretary Arsenio Balisacan, key figures of the administration’s economic team, have supported the calls to ban POGOs, which mostly cater to clients from mainland China and employ a large number of Chinese-speaking foreign workers.

Several lawmakers and business groups have also urged the President to impose a total ban on POGOs.

Aside from money laundering activities, crimes attributed to the POGOs have expanded over the past years and now include human trafficking, abduction, homicide, illegal detention, kidnap-for-ransom, theft, robbery-extortion, serious physical injuries, swindling, grave coercion, investment scam, cryptocurrency scam, and love scam.

For added insight, watch this GMA Network news video of President Marcos making the declaration.

Let me end this piece by asking you readers: What is your reaction to this recent development? Do you think the newly declared nationwide ban on POGOs will reduce the connected criminal acts? Are there many POGO-connected foreigners living in your local community? Do you think the ban on POGOs will result in lesser Chinese nationals coming into the country? Do you think the closures of POGOs will affect a lot of small businesses that sold products or services to them?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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BIR’s withholding tax on online sellers in effect

July 23, 2024July 16, 2024carlocarrasco

With the extension of the deadline over, the Bureau of Internal Revenue’s (BIR) withholding tax on online sellers who conduct business on electronic marketplaces (example: Lazada) came into effect recently, according to a Manila Bulletin business new report.

To put things in perspective, posted below is an excerpt from the Manila Bulletin news report. Some parts in boldface…

The Bureau of Internal Revenue (BIR) has started implementing the withholding tax requirement for online sellers who conduct business on electronic marketplaces like Lazada and Shopee.

In a statement, BIR Commissioner Romeo D. Lumagui Jr. said there will be no further extensions for online merchants to comply with the new withholding tax system outlined in Revenue Regulations (RR) No. 16-2023.

Under the BIR regulations, e-marketplace operators are mandated to withhold one percent creditable tax on half of the total payments sent to sellers or merchants for products or services sold through their platform.

“Electronic Marketplace Operators will begin imposing Withholding Tax against their sellers/merchants starting July 15, 2024. We have already extended this by 90 days. No further extensions will be given,” Lumagui said.

Last April, the BIR extended the RR No. 16-2023 deadline until July 14, 2024.

“No more extensions will be given after the previous 90-day extension under [Revenue Memorandum Circular] RMC No. 55-2024,” the BIR noted.

The previous extension was given to allow e-marketplace operators to comply with the requirements of the BIR and adjust to the provisions of RR 16-2023 before the withholding tax is imposed.

Lumagui also clarified that withholding tax is not a new tax, noting it is a system where taxes are collected in advance and later offset against the seller’s total income tax liability.

“The BIR aims to level the playing field between brick-and-mortar stores, which are regularly complying with their tax obligations, and online marketplaces,” Lumagui said.

“Whether their business is operated online or through physical stores, sellers and merchants have to pay their taxes,” he added.

Meanwhile, the BIR has given digital financial services providers more time to switch to the new withholding tax system.

Let me end this piece by asking you readers: What is your reaction to this recent development? If you have been selling through the electronic marketplaces, do you think the 1% withholding tax will be a big challenge in the long-term? Have you prepared your business for the withholding tax?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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