By Roderick T. dela Cruz
Some 1.4 million Filipinos are now involved in the e-load business, or the sale of pre-paid mobile phone credits to subscribers.
Ramon Isberto, head of the public affairs group of Philippine Long Distance Telephone Co. and Smart Communications, said the figure confirmed that telecom companies were in business with ordinary Filipinos.
“About 1.4 million micro-entrepreneurs are in the e-loading business,” Isberto said during the launching of the Tipid-Sulit Pinas! advocacy campaign of Talk ‘N Text, the low-cost brand of Smart.
Smart chief wireless advisor Orlando Vea said the 1.4 million micro-entrepreneurs in the e-loading business highlighted the importance of livelihood in the Philippines.
There are nearly 70 million mobile phone SIM cards in the Philippines, although the actual number of users may be less, as a typical subscriber now owns more than one cellphone. Pre-paid subscribers account for more than 90 percent of all mobile phone users in the country.
“Tipid-Sulit Pinas! believes that Filipinos have and continue to overcome crisis situations by using the cheap text messaging as a tool,” said Perry Bayani, group head of Talk ‘N Text.
The campaign hopes to raise funds to support 10 livelihood projects, initially with a seed capital of P100,000 each.
Danilo Mojica, head of Smart’s wireless consumer division, said the campaign would eventually evolve into barangay-based efforts to support livelihood opportunities nationwide.
Bayani said Talk ‘N Text had teamed up with several organizations, including social development foundation Philippine Business for Social Progress, the Payatas women’s initiative Rags2Riches, nationwide sari-sari store chain Hapinoy, the talented group of sculptors Banglos and recruitment network JobsDB.
Saturday, 18 July 2009
By Roderick T. dela Cruz
SEOUL—A South Korean provincial government has leased a major plot of farmland in the central Philippines to grow corn as part of Seoul’s bid for food security, officials said Thursday.
They said Jeonnam Feedstock, a company set up by South Jeolla province, signed a contract in April to lease 95,000 hectares of land for 25 years in Oriental Mindoro province.
Jeonnam Feedstock plans to plant 1,000 hectares of corn for experimental purposes as early as September to produce 10,000 tons of feed in the first year.
“Feedstock prices surged last year, resulting in the suicide of three farmers last year in this province alone,” Lim Young-Muk, an official in charge of the project, told Agence France-Presse by telephone from the southwestern Korean province.
“In order to lock in stable supplies of feed, we need to build overseas feed bases,” he said, declining to estimate how much food the total plot would yield.
Lim said South Jeolla became the first provincial government to benefit from a newly-created central government fund to develop farmland overseas. He said it received a cheap loan of $1.9 million for the Mindoro project.
Lim said such projects were allowed with a Filipino partner.
“We have a respected Filipino company as our project partner,” he said, declining to name it.
Provincial governments in wealthy but resource-poor South Korea are also developing farmland in Cambodia, Indonesia, Mongolia and Russia.
Such projects by Korea and other countries have sometimes been controversial, with critics in recipient countries seeing them as exploitative.
Last year, South Korea’s Daewoo Logistics said it had won initial approval from the Madagascar government to lease 1.3 million hectares of farmland—half the size of Belgium.
But the deal faced collapse amid political unrest there partly sparked by the project.
Hyundai Heavy Industries said in April it had acquired a majority stake in a company cultivating 10,000 hectares of farmland in Russia’s Far East.
South Korea is the world’s fifth largest food importer, relying on foreign suppliers for 74 percent of its needs. AFP
R. S. Sarmiento
GENERAL SANTOS CITY — Efforts have shifted to high gear to proclaim a coastal portion in the Autonomous Region in Muslim Mindanao (ARMM) as the impoverished region’s first economic zone, officials said.
Ishak V. Mastura, ARMM deputy executive secretary, said in an interview that regional Gov. Zaldy U. Ampatuan is expected to declare the village of Polloc in Parang, Maguindanao as a special economic zone.
"Within the special economic zone is the Port of Polloc which will be declared as free port. We’re eyeing the declaration in August," Mr. Mastura said on the phone.
Should Polloc be finally declared an economic zone, it will come six years after the ARMM Regional Legislative Assembly formed the Regional Economic Zone Authority (REZA).
Mr. Mastura, when he was still ARMM Trade secretary, had blamed lack of funds for the failure of REZA to discharge its duties, thus the delay in the declaration of Polloc as ecozone.
Last May, Mr. Ampatuan formed the REZA management committee that has been given P12.5 million in initial funding.
Its first goal is to work out the declaration of Polloc as a special economic zone.
There is, however, the need to greatly improve Polloc port if it will be designated as a freeport, since the facility is in bad shape, having been built 30 years ago, officials admitted.
Among others, the port lacks water supply and lighting, many of its facilities are inoperative, and the port’s generator is missing.
Still, the move to declare Polloc as a special economic zone has gained the backing of the business sector in the area. "We cannot afford to delay the proclamation," said Datu Haron U. Bandila, ARMM Business Council chairman.
Perks enjoyed by ecozone locators in the country include income tax holiday of four years which is extendable to eight years, after which a special 5% tax on gross income will be paid in lieu of all national and local taxes.
Nanette L. Guadalquiver
BACOLOD CITY — Transcom Asia is projected to have about 5,200 employees in its two call centers in the Philippines by the end of 2009, following its expansion in Bacolod this month.
Siva Subramaniam, Transcom Philippines country manager, said the firm now has 3,200 employees at its 2,200-seat Pasig-based facility, almost five times the initial work force of 700 last year.
He said the Bacolod operations is expected "to be full by the end of 2009" with the hiring of 2,000 call center agents for its 1,000-seat facility to be known as Transcom Center Bacolod at Lopue’s South Square.
Duncan Cowie, regional general manager for North America and Asia Pacific, said the Bacolod operations will start on Aug. 1, and the Transcom Center Bacolod will be inaugurated in October.
Messrs. Subramaniam and Cowie were in Bacolod Wednesday night for the media launch of the Transcom operations in Negros Occidental. "We have arrived. The plan has been in the making for more than a year," Mr. Subramaniam said, as he introduced the group of about 30 initial hires, who are now being trained by Transcom to man its Bacolod operations.
Mr. Cowie said the Transcom Center Bacolod will be part of the Transcom City complex, which will include sports, recreational, and wellness facilities for employees. It will be the 14th site to be accredited by the Philippine Economic Zone Authority in Bacolod, and once issued a presidential proclamation, will be the eighth information technology zone in the city.
Transcom Asia, whose key services are outbound sales, inbound care, and collection services, is the seventh contact center facility in Bacolod, after Teleperformance, TeleTech, and Convergys, and medium-sized Focus Pacific Communications, Next Level IT Teleservices, and Telequest BPO Center. Transcom, mainly owned by Swedish investment group Kinnevik, has more than 22,000 employees in 29 countries.
Friday, 17 July 2009
MANILA, Philippines – The Commission on Elections (Comelec) will invite bloggers to cover the 2010 elections, from the preparations up to the proclamation of winners, a spokesman for the poll body said Thursday.
The Comelec is formulating a “framework of cooperation” with the blogging community to cover key points in the elections such as voter education and field testing of counting machines, the commision’s spokesman, James Jimenez said.
“We believe that bloggers represent a significant part of the general public to be informed about the most recent developments in elections automation,” Jimenez, who is also a blogger, told INQUIRER.net.
Jimenez cited the potential of blogs to educate the electorate, especially the youth.
Blogger and freelance journalist Tonyo Cruz said bloggers would play a crucial role in the upcoming elections by offering a “more democratic coverage.”
“Bloggers, new media publishers, and Filipino netizens can help democratize the media landscape as the nation gears for the elections,” Cruz said.
Cruz said “reform-minded” bloggers could organize a network of citizen journalists to guard against fraud or help their favored candidates win.
Thursday, 16 July 2009
Construction work on the 82-kilometer Phase One of the Northrail Project (from Caloocan to Malolos) is now proceeding at an accelerated pace. To mitigate slippages, simultaneous segmental construction shall be the methodology henceforth.
At the Malolos Viaduct, the construction of 573 bored piles has already begun. Procurement of brand new rolling stock is ongoing. The Railways and Systems Planning Team is scheduled to check on the capability of suppliers to deliver the rolling stock. It is expected that in the first quarter of 2009, the design of line and track for Section 1 shall have been accomplished. Design of stations shall be finished by August of 2009 after which construction will ensue.
Engineering works, relocation of informal settlers who occupied the abandoned Philippine National Railways alignment, and the flow of funds for the project are proceeding smoothly. Northrail has increased its technical capacity to expedite the review and approval of the design.
More than an estimated 50,000 informal settlers used to occupy a large part of the right-of-way on the Caloocan to Clark alignment. Of this number, some 23,000 families have so far been relocated to in-town relocation sites. In-town relocation means affected families are relocated in the same town where they come from, with the assurance of eventual land ownership. They were likewise assured of improved living conditions, as resettlement sites are developed with provision for all the basic facilities and utilities
The Northrail Project will boost employment opportunities in the countryside. During the construction stage alone, the Project is expected to generate about 34,000 jobs, directly hired for the implementation of the project. Northrail plans to privatize the Operations and Maintenance (O&M) of the Project upon completion of construction. The O&M is expected to directly generate about 800 jobs.
Apart from the employment opportunities, additional income will be directly generated when the Project finally comes to full swing. These include indirect jobs and enterprise opportunities for those residing or holding businesses along the alignment. Additional work demand from supplies, equipment rentals and other construction related activities will also take place.
For the latest Philippine news stories and videos, visit GMANews.TV
For the latest Philippine news stories and videos, visit GMANews.TV
For the latest Philippine news stories and videos, visit GMANews.TV
Darwin G. Amojelar
The shopping mall unit of the SM group will be injecting funds into the construction of the Grand Central Terminal for the three mass rail transits (MRT) near SM North EDSA, a source said.
According to the source, the Sy family-led SM Prime Holdings Inc. has offered P200 million to partly finance the terminal.
The National Economic and Development Authority (NEDA) board has approved the Metro Manila Integrated Rail Terminal (MMIRT) project on Tuesday with the understanding that the Light Rail Transit Authority (LRTA) would accept SM Prime’s offer.
This will cut the government’s original capital outlay for the project to P578 million from P778 million, the source added.
“The station shall be named the SM-TriNoma station as a condition in the P200-million donation of SM and TriNoma financing and construction of pedestrian walkway from TriNoma to SM,” the source said.
The MMIRT aims to provide a common terminal for easy passenger transfer between
Metro Rail Transit Line 3 (MRT 3) and Line 7 (MRT 7). This will also connect passengers to the Light Rail Transit Line 1 (LRT 1), which is being extended from its Monumento terminal.
The source said Mel Robles, LRTA administrator assured President Gloria Arroyo that the agency plans to complete the station and LRT Line 1 North extension by December 2009 from the earlier target of May 2010.
The LRT 1 North Extension Project has original four stations namely, Monumento, Balintawak, Roosevelt and North Avenue.
The Balintawak station will provide modal interchange with bus and jeepney services entering Metro Manila from the north via the North Luzon Expressway.
Once the extension is complete, the LRT 1 is expected to serve about 800,000 to 1 million passengers.
The LRT 1 North Extension Project, which aims to close the EDSA Loop, will need three additional stations from the existing Monumento Station and ending at the North Avenue Station of MRT 3.
Philippine Daily Inquirer
MANILA, Philippines - Investor sentiment in the Philippines has turned more upbeat in the second quarter alongside a rosier global outlook but the pace of improvement lagged the pace seen in other Asian emerging markets, the latest quarterly survey by Dutch financial giant ING showed.
ING’s second-quarter Investor Dashboard Survey showed a significant 27-point increase in investor sentiment in the Philippines for the second quarter from 89 to 116.
“This quarter-on-quarter 30-percent improvement indicates revived investor confidence amid the gains in the global and local stock markets in the first half of the year,” ING said in a statement.
But ING also pointed out that the sentiment remained in the “neutral” category, lower than the overall pan-Asia index.
“While all markets had improved investor confidence for this quarter, the Philippines is one of five markets that are still in the neutral zone,” it said.
All key investment sentiment indicators for the Philippines increased in the second quarter but at a smaller degree than other markets, with the Philippines garnering one of the lowest improvement ratings among the 13 markets.
Commenting on the survey results, ING Manila managing director Cesar Zulueta said: “Despite registering modest improvement rates, the latest survey findings simply reinforce our belief that the Philippine economy is more stable than most in the region and less affected by global and regional market fluctuations.”
“We are seeing an increase in investor confidence, and depending on their risk profile, we recommend investors to begin considering more risky assets such as equities as the bottoming of interest rates may eventually lead to fewer opportunities for fixed income securities,” he added.
ING said that with the Philippine stock market growing 24 percent, Philippine investors’ economic and financial outlook brightened, but they maintained a “conservative” investment strategy. The survey showed that 40 percent of Philippine investors were expecting that the negative impact of the US economic crisis on investments would wane by the third quarter of this year.
The overall pan-Asia (excluding Japan) ING Investor Dashboard Sentiment index increased to 132 for the second quarter from 85 a quarter ago, despite continued economic uncertainty across most markets in Asia. The survey results showed the biggest quarter-on-quarter increase in investor sentiment since the Index was introduced in the third quarter of 2007, moving the index from the “neutral” into the “optimistic” category.
The survey is conducted across 13 markets in the Asia Pacific, and not only provides market insights on investor attitude and outlook but also allows each market to be benchmarked and tracked against the overall investor sentiment across the region using the pan-Asia index.
The rebound of regional and global markets is seen to have influenced the improvement in investor sentiment in the Philippines with 27 percent of investors believing that the economic situation in the country has improved versus 11 percent in the previous quarter.
The survey also showed that more Filipino investors believed that their household financial situation has improved (35 percent from 23 percent in the first quarter). They also said their personal financial situation also improved (32 percent versus 26 percent) and 50 percent believed that it would continue to improve in the next quarter, compared to 44 percent in the previous survey.
Majority of Filipino investors (52 percent) believed that the economic slowdown would have an impact on job security and 64 percent said it would influence their investment decision.
Inflation affected 68 percent of Filipino investors’ decision to invest last quarter, with 59 percent of Philippine investors indicating that inflation would rise in the third quarter, again suggesting this would impact their investment decision in the next quarter.
Strong financial market performance in the second quarter was marked by an increase in return of investment for 36 percent of surveyed Filipino investors compared to 20 percent in the first quarter. As a result of the positive return on investments observed last quarter, 49 percent of Filipino investors now expect investment returns to continue to increase in the third quarter.
Dr. Bernardo Villegas
I am grateful to the management of INQUIRER.net for inviting me to write this regular column especially addressed to the millions of OFWs all over the world.
As a professional economist, I have often cited the significant contribution all of you are making to the economic progress of the Philippines. From my own calculations, the remittances you send to your relatives in the Philippines contribute as much as 12 percent of GDP, especially this year when our economy is slowing down because of the ongoing global crisis.
I have decided to entitle this column Thinking Global because I have often remarked in the economic briefings and lectures I give both here and abroad that one of the reasons why we have been left behind by our East Asian neighbors in economic development is that we have for too long been very insular in our thinking, adopting an inward-looking strategy based on import-substitution and nationalist industrialization. Unlike our neighbors, we did not think global, that is rack our brains on what we could sell to the rest of the world. We were too obsessed trying to protect our very limited domestic market. We were too paranoid about the presence of foreigners in our economy.
One of the major benefits that OFWs can confer on our economy is to open the eyes of those of us left behind to the many opportunities of trading with the rest of the world. A good number of you will come back sooner or later and the contacts, knowledge, skills, and positive values you are acquiring in your respective host countries will make more Filipinos think global, even as they necessarily have to act local. What you have learned from your stay abroad will still have to be adapted to the local conditions in the Philippines. In my future columns, I will talk about the leading sectors of the economy where the OFWs returning can start businesses of their own, apply the technology and practices that you have learned abroad.
Let me congratulate you for all the testimonials I have heard from your foreign employers about the sterling qualities of overseas Filipino workers. I spent the years 2007 and 2008 teaching in the IESE Business School in the beautiful city of Barcelona, where I met a good number of Filipino workers. While in Barcelona, I did a lot of traveling to other European cities, giving economic briefings to potential and actual investors in the Philippines. There was no place where I did not hear lavish praises heaped on Filipino workers for their outstanding traits. That is why I have been telling the people in the World Bank and other international agencies that the Philippines will not suffer from a large decline of remittances that OFWs send home this year, despite the fact that rates of unemployment all over the host countries have risen to very high levels (for example, in Spain it is reaching 20 percent).
The remittances during the first four to five months of 2009 have actually increased, albeit at a slower rate. I am sure that in the second semester of this year, the growth in the remittances will accelerate because new Filipino workers being deployed are more, more numerous than those who are returning.
In Dubai, a seven-star hotel sent many of their foreign workers home, except the Filipinos. Why? Because Filipinos are multi-skilled and can assume different jobs, reducing the manpower costs of their employer. In Barcelona, a restaurant chain hires only Filipino waiters. Why? Because of our pleasant disposition and personal hygiene. In the United Kingdom, patients prefer Filipino nurses. Why? Because of the tender and loving care they give, in addition to their technical skills. In international shipping lines, a greater percentage of the crew is composed of Filipinos. Why? Because they speak English and are very adaptable to various cultures. I can go on and on. In fact, I would appreciate other examples that my readers can send me so that together we can convince the international financial institutions that the remittances you will be sending to the Philippines will not suffer large declines this year.
These remittances will greatly contribute to the 4 percent growth in GDP that I personally think we can still attain in 2009, as our neighbors like Singapore, Hong Kong, and Taiwan suffer large declines of 4 to 6 percent in their GDP.
You may be asking what are the other sources of growth that will benefit your relatives, especially in the provinces. Well, there are hundreds of billions of pesos that will be spent in the second semester on infrastructures in the countryside, such as farm-to-market roads, irrigation systems, post-harvest facilities, seaports and airports. These construction projects are generally labor-intensive and will employ many of your relatives who are living in the rural areas. Another major engine of growth will be the spending by the candidates for the May 2010 elections. We may see a repeat of the 1992 national elections when some 5 to 7 candidates may be running for President. If you put all the candidates for the Senate, the House of Representatives, governorship, mayoralty, etc. you can imagine the financial largesse that will be flowing to the masses, contributing to the pump-priming that is very much welcome during these recessionary times. As an aside, I hope you will use your right as absentee voters.
I wanted to set the mood right in this maiden column I am writing for INQUIRER.net. Some of you might have used my textbooks like Guide to Economics for Filipinos or Economics for the Consumer in your high school or early college years. If you did, then you know that I always take a positive view of things, even while conscious of the many difficulties we are facing as individuals and as a nation. The glass is half-filled, I always say. I hope as we interact with one another you will eventually share my optimism about our country. A great deal of that optimism I owe to the fact that millions of you are out there sacrificing yourselves for the benefit of your loved ones.
You are the first ones I think of when I think global. My thanks and prayers go with you.
MANILA, Philippines—Dr. Bernardo Malvar Villegas, renowned economist and professor at the University of Asia and the Pacific-Manila, now writes for the Global Nation channel of INQUIRER.net.
Villegas, who was among those who topped the board for certified public accountants in 1958, has a Ph.D. in Economics from Harvard University(1963). At Harvard, he was one of the youngest to be a teaching fellow in the College of Arts and Sciences at age 21.
His special fields of study are development economics, social economics, business economics, and strategic management.
He is the author of several economics textbooks widely used in Philippine schools and universities. He has also written a number of management best sellers like The Philippine Advantage, Book of Values, Productivity: Path to Global Competitiveness, The Filipino Phenomenon, and The Philippines at the Threshold of the Third Millennium.
He has received several prestigious awards such as the Ten Outstanding Young Men 1972, Fulbright, Johnson Foundation, Asia Foundation, and the Instituto de Cultura Hispanica.
He is currently a member of the boards of directors or advisory boards of leading national and multinational firms, such as the Benguet Corporation, Insular Life, Alaska Corporation, Phinma Property Holding Corporation, Rolls Royce, and Dupont. He served in the boards of Bank of the Philippine Islands, Globe Telecom, McDonalds, and IBM.
He is a consultant on management development and strategic planning for numerous leading firms operating in the Philippines and Asia Pacific. He serves in the boards of leading non-governmental organizations like the Makati Business Club, Pilipinas Shell Foundation, Phinma Foundation, the Parents for Education Foundation, and the Dualtech Foundation.
Through his work at the University of Asia and the Pacific and the Center for Research and Communication, he is often asked to give advice to top government officials in many policy issues, especially in industrial policy and countryside development. He was a member of the Constitutional Commission that drafted the Philippine Constitution under the government of former President Corazon Aquino.
He is very often on road shows briefing international audiences on the Philippines and the Asia Pacific region. In July 1992, Dr. Villegas was appointed member of the Council of Economic Advisers of President Fidel Ramos. In July 1998, he was asked by President Joseph Estrada to help promote the Philippines among local and foreign investors.
He continues to focus on investment promotion as a major activity in the administration of President Gloria Macapagal-Arroyo and sits as a private sector representative in the Philippine Infrastructure Corporation. He served in the Pacific Board of Economics of Time Magazine and writes regularly for both local and international newspapers, such as the International Herald Tribune and the Asian Wall Street Journal.
OF Remittances in First Five Months At US$7.0 Billion
CLICK HERE TO VIEW TABLE
Remittances from overseas Filipinos (OFs) coursed through banks grew year-on-year by 3.7 percent in May 2009 to reach a record high of US$1.48 billion. The second highest level of remittances, at US$1.47 billion, was registered in March 2009. Cumulative remittances for the first five months of the year totaled US$6.98 billion, representing a 2.8 percent increment from the level recorded in the same period last year. Remittances from both sea-based and land-based workers posted gains at 4.6 percent and 2.4 percent, respectively.
“The stream of remittances from overseas Filipinos continued to show signs of strength despite lingering global economic fragilities, providing some basis for cautious optimism regarding steady remittance levels for 2009,” BSP Governor Amando M. Tetangco, Jr. said. Remittance flows continued to be underpinned by the steady demand for Filipino workers abroad, specifically professional and skilled workers, as well as the expanded access of overseas Filipinos and their beneficiaries to a wide range of financial products and services offered by banks and other financial institutions.
Demand for Filipino workers is expected to hold up as a result of hiring agreements forged between the Philippines and some host countries such as Qatar, Saudi Arabia, Canada, Australia and Japan. Recently, the Department of Labor and Employment (DOLE) reported that the Philippine government entered into a bilateral agreement with South Korea on the employment of Filipino overseas workers. A Memorandum of Understanding was signed between the Philippine Department of Labor and Employment and its South Korean counterpart in May 2009 aimed at hiring up to 5,000 Filipino workers in the South Korean manufacturing industry and other sectors within the next ten months. The DOLE also reported that the Philippine Overseas Labor Office in Tripoli has started talks with the Libyan Health Ministry for the recruitment of about 4,000 Filipino medical workers in Libya.
Moreover, despite the relatively weak global economic environment, the Philippine government’s intensified efforts (such as employment facilitation programs) to assist retrenched overseas workers have contributed to the deceleration in the rise in the number of displaced OFWs.
Meanwhile, bank and non-bank service providers have been expanding their operations overseas and introducing new products and services to overseas Filipinos and their beneficiaries in the country.
For the period January-May 2009, the major sources of remittances were the U.S., Canada, Saudi Arabia, U.K., Japan, Singapore, United Arab Emirates, Italy, and Germany.
SMART Communications Inc. has taken its first steps to massively deploying WiMAX technology across the country.
The country’s leading wireless services provider has undertaken tests of the powerful wireless broadband platform with equipment manufacturer Motorola, paving the way for rapid rollout of the new network. Motorola is the principal contractor for Clearwire Communications, the leading provider of mobile WiMAX service worldwide.
WiMAX, or Worldwide Interoperability for Microwave Access, is a telecommunications technology that provides wireless broadband access to a wide area spanning several kilometers.
Smart’s WiMAX deployment, through its subsidiary Smart Broadband Inc., is part of the company’s efforts to replicate the success it achieved in cellular phones in the field of wireless broadband Internet.
“It has been our vision to provide Internet for all Filipinos—no matter where they are or what device they’re using,” said Orlando Vea, Smart chief wireless advisor, in a statement.
He added that Smart is set to build one of the most extensive WiMAX networks in Southeast Asia for fixed wireless broadband applications.
Smart’s WiMAX network will complement its high-speed packet access (HSPA) network, which is based on the most advanced mobile broadband technology. Smart is one of the only 20 mobile carriers in the world and the only in the region to have deployed HSPA running on 850 MHz.
“With our HSPA, WiMAX and Canopy networks blanketing the whole country, Smart will have a unique and, by far, superior combination of wireless broadband networks,” Vea said.
Smart’s WiMAX network will be a key component of its Internet For All initiative, including its schools connectivity program. Under the Smart Schools program, the company has connected 250 public elementary and high schools to date.
In partnership with the Commission on Information and Communications Technology, Smart has connected an initial batch of 50 public high schools and is now working with the Department of Education in a program to provide connectivity to about 6,600 public high schools across the country.
WiMAX uses the 802.16 standard developed by the WiMAX Forum. It provides a maximum bandwidth speed of up to 70 megabits per second, which is apt for data-hungry applications like streaming video.
Since WiMAX covers a wider distance and serves more users at any given time while allowing high- speed data access, it can reach to ”blackout areas“ that currently have no broadband Internet access. It can enable Internet penetration even to the most remote barrios and barangays.
“We will make sure no Filipino family is left behind in terms of Internet access. We have done it with the mobile phone, we will do it again with the Internet,” Vea said.
To date, the company has about 8,700 cell sites across the country, housing various network equipment, including antennae for GSM, HSPA and Canopy. Very soon, these same towers will play host to Smart’s extensive WiMAX network.
For the trial, Smart and Motorola installed the latter’s WAP 450 WiMAX Access Points equipment to a number of cell-site towers across the country. The WAP 450 utilizes tower top power amplifiers that can be housed in a small cabinet, allowing for a compact cell-site configuration.
Outside the Box
If the stock market is a leading indicator, a predictor of the future, then the rest of 2009 is going to be a boom time.
I know that you know the second-quarter economic results will be much better than the first quarter.
We will most likely look back on the first three months of 2009 as being the bottom of the negative global repercussions on the Philippines. With low inflation and increased confidence in many business sectors, this should translate into more economic output for the April-June period. I anticipate that both confidence and output are going to continue for the rest of the year. Even the strident Philippine gloom-and-doomers are going to have to admit at some point in the near future that they have been wrong about this economy.
The signs are all around us if we know where to look.
The recent sale of government debt on the world market is a good example. The Philippine Star headline pretty much sums up the economic picture: “RP global bond issue 6 times oversubscribed.” The government issued $750 million of debt coming due in 2020. Several things are very significant and favorable about this offering.
If foreign investors are worried about the medium- to long-term fiscal problems of the government, they would not have responded so favorably to purchasing this government- bond issue. Other countries are not as fortunate.
The fact that foreign buyers were so interested in participating is evidenced by the fact that the offering was oversubscribed by six times; that is, there were offers to purchase $4.5 billion of these bonds. Granted, the interest rate was quite high in relation to US Treasury debt, but in fact, that also is a bright spot. They received a higher interest rate as a sweetener to the deal, but they were not afraid their money would not be paid back.
Now where does the Philippine stock market figure in all of this? Believe it or not, the local market has been in an unprecedented uptrend for the last six months.
Every month since February 2009, the market has been up. I say “unprecedented” since this is the longest sustained positive movement of our market in the 21st century. And because of this long sustained movement, the market is now signaling that this is only the beginning of higher prices to come.
As a forecaster of the future, stock markets are usually six months ahead of the curve. If that holds true in this case, then we are looking for a much brighter economic outlook for the rest of the year. I tend to strongly believe the predicting power of the stock market. Look at what happened to our market in 2008.
The early part of the year saw prices fall like a rock. The end of 2008 lived up to that prediction as the global financial crisis exploded onto the front page of every newspaper. Then came the worst period for stocks in October. If we move forward six months, we come to April 2009. And then we saw the release of first-quarter economic growth, which was down, of course.
But throughout 2009, stock prices have been up and I believe that this tells us what to expect for the rest of 2009. But what about beyond this year?
Some analyses are saying that the profit-taking over the last month is not a good sign for the future. I strongly disagree. It is a good thing to take profits out of the market from time to time. However, in spite of the profit-taking, overall, prices are still up and July 2009 will end on a positive note.
That is the extremely good sign.
Rising stocks prices become self-reinforcing. Rising prices create an atmosphere of confidence, that brings more money into the market, which creates even more confidence in the future and the belief that prices will go up. Looking at the market right now, that is what I see happening. Confidence-building on confidence.
If this trend sustains even for only a few weeks more, we should rally through the end of 2009 and perhaps longer, or at least until the broad index reaches 3,400. As that happens, you will most definitely see individual stock prices double and even triple from current levels.
Stock prices are quite undervalued in relation to other assets. Look at real-estate prices and how high they have risen in relation to all prices in general. Interest and deposit rates are quite low, which means the “price” of corporate debt is high. The one investment that is still a bargain is stock.
By virtually every measure of stock value—Price-earnings ratio, book value, price-to-equity ratio—stocks are still cheap. But more important, as corporate profit grows with the economy, these measures will still show bargain prices for some time to come. The rally is just begging, as are the profit-making opportunities.
On a personal note, beginning next month I will publish a weekly market update, with trading strategies based on technical analysis which gives entry prices and timing. You find all the fundamental information about local listed firms right here on the pages of the BusinessMirror. If you would like subscription details and an example of this weekly update, now available only to members of the Portfolio Trading Program, please e-mail me.
PSE stock-market information and technical analysis tools provided by CitisecOnline.com Inc. E-mail comments to firstname.lastname@example.org.
Wednesday, 15 July 2009
MANILA, Philippines - Despite the nightmare he had gone through, freed Italian Red Cross worker Eugenio Vagni yesterday said he is still willing to return to the country.
“If they ask me, why not? I love the Filipino people,” Vagni said.
The 62-year-old engineer said he has already forgiven his abductors and called on them to go back to society and lead normal lives.
“You have kept me for six months and now I am free and alive. Now it’s time to think of normal life,” Vagni said.
He admitted though that there were times that he felt his life was in danger, but remembering that his wife and children are waiting for him kept him going.
“I meditate, think of the good times and my family. Hope to be free one day,” he said when asked what were the things he did as a captive in Sulu jungle.
While in captivity, Vagni said he lived like his abductors, slept without a bed and ate only fish and vegetables. He lost 20 kilos since his abduction last January.
He said his captors spoke to him only a few times because many of them do not speak English.
When told by his abductors that he would be released anytime, Vagni said he initially doubted it.
“They have told me that I am free for the past months so when they informed me I said sorry but I don’t believe you,” he said.
Vagni said he has not yet decided what to do next.
“After six months in captivity, I have lost something about myself that I have to get back. I have to find myself before deciding what to do,” he said.
Looking gaunt but renewed, he was escorted to the Palace for a meeting with President Arroyo by Italian Ambassador to the Philippines Reubens Fedele, Sen. Richard Gordon, Western Mindanao Command chief Maj. Gen. Nelson Allaga and Task Force Comet head Maj. Gen. Juancho Sabban.
Vagni met and thanked the President for the government’s efforts to secure his release.
The President welcomed him with a warm smile. Executive Secretary Eduardo Ermita and Defense Secretary Gilbert Teodoro joined Mrs. Arroyo in welcoming Vagni at Malacañang’s Music Room.
“Good to have you back. Welcome,” she told Vagni, the last of three ICRC workers taken captive by the Abu Sayyaf in Patikul, Sulu last January.
Ermita said Vagni related to Mrs. Arroyo how life with the bandits was, including his feeling of hopelessness as well as his many prayers that were eventually answered.
He said Vagni will fly back to Italy then to the International Committee of the Red Cross headquarters in Geneva, Switzerland.
“He will do some thinking back home,” Ermita said.
Life without football
Later at a press conference, Vagni related how he was actually deprived of daily life, love and news from home – including one item that stunned him Tuesday: his football team didn’t make it to the European Champions’ League.
“Oh, no, no, no,” the newly-freed ICRC volunteer said at a news conference.
Freshly shaved and in a brown suit, Vagni recalled how he dodged gunbattles between his captors and government troops, survived on scant meals of fish and rice, and longed for home near Florence with his Thai wife and daughter.
He appeared calm and composed, until the talk turned to football.
A journalist remarked that Florence’s team, Fiorentina, has emerged champion. It was a joke – Fiorentina actually finished fourth in Italy’s Serie A and so failed to win an automatic place in the European Champions’ League, a coveted event among legions of Italian sports fans.
For the first time, Vagni seemed to be riveted. “Yeah?” he asked. “Now please tell me because I don’t know. I missed it for six months.”
Fedele, who sat beside him, cut in. “Please don’t say these things to a Florentino,” Fedele said, smiling.
“If he finds out it is not true, he can have a very bad reaction afterward,” the ambassador said in jest, then gave Vagni the real news and drawing the aid worker’s anguished response. – Paolo Romero, AP
MANILA, Philippines – Southeast Asian Airlines (SEAIR), the country’s premiere leisure airline, is extending its promo for the lowest fares to Boracay (Caticlan). Ongoing until Oct. 15 travelers can fly to Caticlan for as low as P350. To avail of the promo, passengers simply have to purchase their tickets online at www.FlySeair.com.
Seair Caticlan-bound passengers get complimentary transfers from the Caticlan airport to Boracay beach and vice versa, the shortest queues and airport check-in procedures, the fastest baggage claims, and exclusive boarding pass privileges in partner establishments in Boracay and Manila. Seair offers the fastest flights to Boracay at just 35 minutes.
Seair launched Seair Travel Care. For a small additional fee Seair travel care provides travel insurance coverage for luggage losses or damages and other travel inconveniences. It is available online at www.FlySeair.com.
Seair flies directly from Manila to El Nido twice a week. Seair, the nation’s second-oldest airline and has flown almost three million passengers to local destinations including Puerto Princesa, Tablas (Romblon), Clark, Zamboanga, Jolo, and Tawi-tawi. SEAIR also offers flights from Boracay and Puerto Princesa to Kota Kinabalu, Malaysia. SEAIR will soon fly to Baguio City and Masbate.
For more information log on to www.FlySeair.com or call 849-0100.
JAMES A. LOYOLA
San Miguel Brewery Inc. (SMB), the brewery unit of conglomerate San Miguel Corporation, reported a 4 percent improvement in net income after tax for the first half of the year to P4.86 billion.
During the firm’s annual stockholders’ meeting yesterday, SMBI president Roberto Huang said that first semester 2009 net sales revenue rose 4.2 percent year on year to P24.8 billion. SMB sales volumes reached 86.0 million cases.
Operating income amounted to P7.6 billion in the first semester, a 6 percent increase from the previous year. Huang said earnings growth was driven by continued cost management efforts and more stable raw material prices.
Meanwhile, the SMBI Board of Directors approved a cash dividend of P0.11 centavos per share to all shareholders of record as of July 28, 2009 payable on August 10, 2009. SMBI held its first-ever stockholders meeting on Monday.
Earlier this year, the brewery completed a record-breaking P38.8 billion bond offering — the largest ever debt offering by a corporate issuer in the Philippines.
Proceeds from the bond offering were used to purchase the domestic beer brands and brewery land assets from San Miguel Corporation.
SMBI chairman and SMC president Ramon Ang said they expect to complete SMBI’s acquisition of SMC’s international beer business “hopefully in a couple of months.”
He added that the acquisition can easily be funded by SMBI from its internal cash flow as well as loan facilities that are being extended by banks. “SMBI has strong financial capability,” Ang said.
Huang said SMBI also intends to grow its domestic beer business despite the market leadership of its brands noting that new opportunities are opening up as more women now drink beer and a new breed of beer drinkers have been born out of young urban professionals who have more discretionary incomes.
He said SMBI is also looking to increase its sales by expanding its coverage in areas that are currently under-served.
By Dan Mariano
Proponents of artificial contraception in the Congress are apparently on a roll. Last week Rep. Edcel Lagman of Albay was reported saying that the Reproductive Health bill has gained even more adherents in the House of Representatives.
Lagman claimed that 22 additional congressmen have bolstered the ranks of the original 108 co-authors of the highly controversial House Bill 5043. He is also hoping that 24 more congressmen would sign up on the RH bill, giving their bloc a majority of the House quorum “at any given time.”
With the recent addition of new party-list representatives, the House now has 265 members.
Numbers, however, are not the only reason for Lagman’s optimism that the third regular session of the Fourteenth Congress would finally see the passage of the RH bill.
The Bicolano lawmaker pointed out the support of several senators and the general public as shown in the findings of recent opinion polls. Moreover, he said, the bill has been endorsed by nongovernmental organizations and Christian congregations, save for the dominant Roman Catholic Church, whose leaders remain opposed to any form of artificial contraception.
As of last estimate, there are about 90 million people in the Philippines. The country’s annual population growth rate of 2.04 percent is one of Asia’s highest—and well above the government’s target of 1.9 percent.
HB 5043 proponents insist that “modern” family planning is an indispensable component of sustainable development. If the country is to achieve the economic growth rates of its dynamic neighbors—such as China—it must curb its population growth, RH bill supporters say.
China is a favorite model because its rapid, double-digit economic growth coincided with its adoption of a one child per couple population policy in the late 1970s. Recent reports from the mainland, however, tend to show that the draconian population measure has not lived up to all its promises. It even threatens to thwart China’s economic ambitions.
David Pierson of the LA Times reported recently that the bold social experiment—which, indeed, helped slash mass poverty and improve living standards—is now threatening China’s hard-won gains.
“China’s working-age population—the engine behind its prolific growth—will start shrinking within a few years,” Pierson wrote in the report, which had Cao Jun and Nicole Liu as contributors.
The ranks of China’s elderly are projected to soar. “By the middle of this century, fully a third of China’s population will be age 60 or older, compared with 26 percent in the United States,” Pierson reported. “China’s projected 438 million senior citizens will outnumber the entire US population.”
What China faces is a predicament confronting many Western societies; fewer and fewer workers will be available to care for a burgeoning number of senior citizens.
Pierson’s report, however, pointed out a major difference: “China’s family-tinkering policy has accelerated a shift that the country is ill-prepared to manage and finance.”
The LA Times article quotes Richard Jackson of the Washington-based Center for Strategic and International Studies as saying: “The problem is the age wave is coming while China is still relatively poor. China may be the first major country to grow old before it grows rich.”
China’s business capital, Shanghai, offers a preview of what looms in the entire country’s demographic horizon. Over a fifth of the population of the largest Chinese city is over age 60. In 11 years that figure is estimated to double to 40 percent.
“Seniors crowd public parks to do tai chi exercises in the morning and play checkers in the afternoon. They natter with one another on city buses, where everyone 70 and older rides free of charge,” Pierson reported.
“So many residents have reached retirement age that city officials are urging local companies to persuade their aging staffs to stay on the job longer. The government has injected $618 million into the public pension system over the last two years to keep it solvent,” he added.
Pierson quoted Lu Yiwen, a 45-year-old factory technician, as saying: “I’m not sure what we’re going to do when my husband and I get old. We have one son and we just hope he can take care of us. Maybe he’ll have his own business. But it’s a lot of pressure for one child.”
Western observers continue to see China as a low-income country, notwithstanding its impressive economic development. Its per-capita GDP in 2008 was just over $5,000, a ninth of America’s.
Just three out of 10 Chinese workers are covered by a pension scheme; majority of those who have coverage are city-dwellers. “Families save copiously, but it’s rarely enough to support them through old age,” Pierson wrote. “Average life expectancy is 73 years—up a stunning 32 years since the People’s Republic was founded in 1949.”
Pierson added: “For most Chinese, social security still means relying on extended family. But that bond is being strained by low birthrates and the migration of tens of millions of young people from the country to jobs in far-off manufacturing plants.”
There are lessons to be learned from China’s demographic predicament. Our lawmakers would be well advised to heed them.
Analysts point to low inflation as big factor
The Philippines will likely avoid a recession this year because of remittances, strong consumption, low inflation and interest rates and high liquidity, business analysts said on Tuesday.
Speaking at a forum at the Philippine Stock Exchange, the analysts said that the economy likely grew in the second quarter and the momentum is expected to be sustained for the whole of 2009.
“The performance of the stock market mirrored the performance of the economy,” said Stock Exchange President Francis Lim, citing the composite index, which has risen 26.2 percent since the start of the year.
Eduardo Francisco, president of BDO Capital and Investment Corp., said that there was about P1.2 trillion ($24.8 billion) of liquidity in the system.
“My clients are seeing growth . . . they are just looking for avenues to invest,” he told reporters.
The optimistic forecasts were in contrast to those of the World Bank and the International Monetary Fund (IMF), which have forecast a contraction of 0.5 to 1.0 percent, respectively for the Philippines this year.
The World Bank and the IMF cited the gross domestic product (GDP) growth of only 0.4 percent in the first quarter of 2009 as evidence of a slowing economy. GDP is the total value of goods and services produced in a country in a year.
Jaime Ysmael, chief finance officer of property giant Ayala Land Inc., said that the country’s property sector was up 31 percent.
He attributed this to continued positive GDP growth despite the global turmoil, large remittances from the millions of Filipinos working overseas, inflation falling to 22-year lows and the reduction in interest rates.
“Consumer spending remains robust,” house building is strong and the Philippine business outsourcing industry is still thriving, Ysmael said.
“We are really in a positive growth scenario. It looks like it will accelerate later on,” he added.
Jose Vistan, head researcher at AB Capital Securities, said that his company had originally forecast a 0.4-percent drop in GDP this year but that might be raised because of signs that the economy performed better in the June quarter.
Firm may invite Japanese to form joint venture
By Doris Dumlao
Philippine Daily Inquirer
MANILA, Philippines—Food and beverage giant San Miguel Corp. plans to tap two Japanese partners for its $1-billion unsolicited proposal to the government to build the Laiban dam as an alternative source of bulk water for Metro Manila.
At the sidelines of San Miguel Brewery Inc.’s first annual stockholders meeting Tuesday, San Miguel president Ramon Ang also told reporters that the Laiban proposal had always been transparent and above-board as he challenged critics and other interested parties to make their own studies and submit their own offer to the government.
Ang said one foreign partner would provide technical expertise while another would provide financial muscle, estimating that the project would cost at least $1 billion.
Fending off criticisms that the project was shrouded in secrecy, Ang said that San Miguel had long disclosed its intention to submit an unsolicited proposal.
“Others who are interested need only to submit a letter of intent to prove that they are financially and technically capable to undertake it,” Ang said, adding that the Metropolitan Waterworks and Sewerage System could check the background of the participating entities.
“Now if you ask if San Miguel is willing to share the results of our studies, of course not! It’s the problem of other competitors to do their own research,” he said. “Our offer is very transparent. But of course, to the speculator who wanted to have a copy of our technical studies and financial studies, we won’t give them.”
San Miguel had been studying the project for the last two years, Ang said, notwithstanding skepticism from others that this was not viable.
“The only (major) source of bulk water for Metro Manila is Angat Dam. But if there’s an earthquake and the dam is damaged, where do we get the water?” Ang said. “That’s why we proposed this as an alternative, to ensure security of water supply. Also, with the fast-growing population in Metro Manila, there could be a water shortage very soon. So our offer is very timely.”
He said San Miguel would not be offended if another group were to bag the project, as long as the dam would be completed.
According to government regulations, unsolicited proposals under the build-operate-transfer system and its variants will be subject to a “Swiss challenge,” in which other interested investors will be invited to submit their own proposals, while the original proponent will have the right to match the best proposal from the challengers.
San Miguel has yet to hear from the MWSS on its proposal after the deadline to challenge it lapsed last July 8, Ang said.
As for a possible “take or pay” provision that could require MWSS or the two private water concessionaires to pay for a fixed volume of raw water from the San Miguel-led joint venture, whether the supply was actually used or not, Ang said the matter was still being discussed.
The dam will be built at the Kaliwa River basin in Tanay, Rizal. A watershed of about 28,000 hectares on the slope of the Sierra Madre mountain range will be drained. The dam aims to provide an average 1.83 billion liters of water a day for about 5.5 million people in southern Metro Manila. The project also has a hydropower component that will produce about 25 megawatts of electricity.
Michelle V. Remo
Philippine Daily Inquirer
MANILA, Philippines—A $1-billion surplus in the country’s balance of payments (BOP) may be expected this year, as inflows of foreign exchange appear to be healthier than initially anticipated, according to the Bangko Sentral ng Pilipinas (BSP).
In its official forecast, the BSP said the BOP would record only a $750-million surplus this year.
But BSP Governor Amando Tetangco Jr. said the projection would be reviewed. He said a BOP surplus of at least $1 billion could be a more realistic estimate.
Tetangco cited the government’s sale Tuesday of $750 million worth of global bonds.
This will help boost the country’s BOP until proceeds are fully withdrawn by the state to fund expenditure requirements, he added.
Unless the government withdraws all proceeds of the bond sale, the foreign currency inflows would support the BOP. The central bank did not take into account the government’s recent bond sale when it set its BOP forecast for 2009.
The government had no intention of selling more bonds, after it raised $1.5 billion from a bond float in January.
But the government later realized it needed more funds to fuel its expenditure program for the year, saying the crisis had caused tax collection to dwindle.
A closely watched economic indicator, BOP is the difference between the inflows and outflows of foreign currencies to and from the Philippines.
A surplus in the BOP adds to the country’s gross international reserves (GIR), or the country’s total reserves of foreign exchange. GIR indicates a country’s capacity to purchase imports, pay off foreign debts and engage in other commercial transactions with the rest of the world.
As of end-May, the country’s GIR stood at a record $39.5 billion. Monetary officials said the level of GIR indicated that the country was not suffering from any liquidity problem and had managed to stay afloat despite the global downturn.
“Latest figures already show that BOP surplus was above $2 billion, and so the full year figure could be higher than the earlier forecast of $700 million,” Tetangco told reporters on Tuesday.
According to data released earlier by the central bank, the country registered a BOP surplus of $2.14 billion in the first four months of the year.
Monetary officials said there might be net dollar outflows in the second half that could trigger a drop in the BOP surplus.
But they also said that the surplus could exceed the conservative estimate of $700 million and hit the billion-dollar mark by year’s end.
Philippine Daily Inquirer
MANILA, Philippines—Despite the global downturn, remittances to the Philippines may have slightly grown in May as Filipinos remain the top labor-resource choice abroad.
Amando Tetangco Jr., governor of the Bangko Sentral ng Pilipinas, said remittances in May likely grew between 2 and 3 percent from the $1.4 billion registered in the same month last year.
Thousands of overseas Filipino workers have been laid off, following the collapse of the US financial sector that fueled the economic downturn. But labor officials earlier said the number of Filipinos newly deployed abroad more than offset the OFWs that had been sent home. Deployment, they said, remained at a double-digit level.
Job cuts were high in the financial and manufacturing sectors, they said. But other sectors, such as health care and education, continued to increase demand for labor.
Tetangco said the rise in deployment and the start of the school year, which forced many OFWs to send tuition money to their families, helped fuel remittance growth in May.
The projected growth of remittances in May could bring the average increase for the first five months of the year to between 2.5 and 2.7 percent from the $6.8 billion posted in the same period last year.
If the projections held true, overall remittances could exceed the government’s official forecast of zero-growth this year.
Tetangco said flat growth in remittances was actually a conservative estimate, noting that the gradually stabilizing economy could help also increase deployment of Filipinos abroad.
“If what we are seeing in the global economy continues, specifically the signs that contractions in the advanced economies are slowing down, then this could eventually lead to higher remittances,” Tetangco told reporters on Tuesday.
Last year, remittances grew a hefty 13 percent to $16.4 billion.
Some analysts said remittances would likely contract this year because advanced economies were in the grip of recession. They said that the United States was still the top source of remittances sent to the Philippines.
But the BSP said a contraction was unlikely. Tetangco said the BSP maintained its forecast that remittances would reach $16.4 billion this year, translating to zero growth from that of last year. But he also said the BSP would review the forecast.
Tetangco said a slowdown in the growth of remittances was expected because of the crisis. But if remittances were to be maintained at the same level as that of last year, the money sent in could help support growth in consumption and the overall economy.
The government expects the economy to grow between 0.8 and 1.8 percent this year.
Gov’t says issue ‘nearly 6 times oversubscribed’
By Ronnel Domingo
Philippine Daily Inquirer
MANILA, Philippines—The government on Tuesday raised $750 million or about P36.2 billion through the issuance of 10-year global bonds.
Finance officials said the commercial bond issue was “nearly six times oversubscribed,” showing healthy investor interest in the debt paper.
The bonds were priced at 99.065 percent to yield 6.625 percent, or 332.6 basis points higher than the benchmark US treasury bond rate.
Of the total amount raised, 60 percent came from Asia, a quarter from the United States and 15 percent from Europe.
This is the second international outing for the government following the debut offering of $1.5 billion in January.
“We are very pleased with the results of the transaction, it represents the lowest yield we have ever achieved in a 10-year benchmark (dollar-denominated) global offering,” National Treasurer Roberto B. Tan said.
Finance Secretary Margarito B. Teves said the strong investor response reflected the continued confidence in the policies and economic management of the government, particularly in responding to the global economic crisis.
Citibank, Credit Suisse and Deutsche Bank acted as joint lead managers and joint bookrunners for the transaction.
The issuance of the global bonds came in the wake of a revision by government economic managers of the budget deficit program to P250 billion from the most recent target of P199 billion.
The revision was due to the downscaling of the economic growth target to between 0.8 and 1.8 percent from a range of 3.1 to 4.1 percent.
International credit watchers assigned the latest Philippine government issue varying degrees of noninvestment grade ratings.
Fitch Ratings gave it a ‘BB’ rating, which meant that the bond is more prone to changes in the economy. The rating has a “stable” outlook.
Fitch expressed concern over the continued weak revenue performance of the Philippine government, “implying an underlying structural fiscal weakness which needs to be addressed in addition to the cyclical deterioration and in spite of the improvement in the overall fiscal balance in recent years.”
Standard & Poor’s gave the issue a ‘BB-’ rating or about the same as Fitch’s except for the negative qualifier, which denotes the likelihood of a downgrade.
“The sovereign credit ratings on the Philippines derive support from the apparent resilience of the sovereign’s external accounts, whereby an improving liquidity position continues to lower external liquidity risk despite the extremely challenging external environment,” S&P said.
Moody’s Investors Service gave the worst rating of ‘B1’ with a positive outlook, which means the bond issuance was speculative and subject to high risk although this was likely to be upgraded.
“The positive rating outlook was affirmed in early 2009, taking into account the resiliency evident in the country’s balance of payments and financial system in face of the global recession,” Moody’s said. “At the same time, it factors in the strained state of public finances.”
By Christian V. Esguerra
Philippine Daily Inquirer
MANILA, Philippines—The half-naked man bathing outdoors, the woman busy with the wash, the child playing by the railroad tracks—they all had a singular expression of awe when the new train chugged past them Tuesday afternoon.
With President Gloria Macapagal-Arroyo as its VIP passenger, the Philippine National Railways (PNR) coach was nothing short of a spectacle, at least to those who continue to stay in the so-called “home along da riles.”
They waved, took pictures with their cell phones and tried to get as close as possible to the slow-moving train, simply unbelieving that the old PNR line had actually been restored to life.
But it’s true: With new and refurbished coaches, the PNR is alive again.
The President inaugurated the rehabilitated train system, which is planned to cut across 19 stations in Metro Manila from Caloocan to Alabang.
Later this year, trains will begin plying the Manila-Bicol route.
Work still to be done
By Ms Arroyo’s own admission, the PNR still needs a lot of work before its facilities and service can be considered world-class.
“She told us to still improve on the surroundings, to beautify them further,” PNR Chair Michael Defensor told reporters after the 30-minute ride from the Tutuban station in Manila to Buendia in Makati City.
Ms Arroyo apparently was not blind to the eyesore that would have greeted commuters once the PNR begins formal operations today.
Gone were most of the informal settlers (called “squatters” in the old days), many of whom used to dispose of their garbage by hurling bags of it onto the roof of a passing train.
Still, the sight of broken concrete, vandalized walls and piles of rubbish throughout the commute could not be ignored.
The PNR trains will start from Caloocan and proceed to Asistio Avenue, C-3 (5th Avenue), Solis, Blumentritt/Tutuban, Dapitan, España, Sta. Mesa, Beata, Paco, San Andres, Vito Cruz, Buendia, Pasay Road, Edsa, FTI, Bicutan, Sucat and finally Alabang, with a 10-minute waiting period at each stop.
For their initial operations, the trains will travel only from Caloocan to Sucat. The Alabang terminal is not yet available because the government has just relocated the informal settlers in the area, Defensor said.
The Tutuban-Sucat commute will cost only P16, he said, adding:
“We would like to make this as affordable as possible.
“Our thrust now is—as we have seen PNR fail in the past—we would like to have a very strong private sector-public sector tieup so that this will be a continuing effort.”
According to Transportation Secretary Leandro Mendoza, authorities are looking into the possibility of a single-ticketing system for all train systems.
Defensor said the SM Corp. might later come in and “take over the stations.”
Per Defensor’s estimate, the government spent around P1.5 billion to rehabilitate the railway system.
He said 18 coaches were made available by Korea and 30 more were being repaired by Santarosa, a jeepney manufacturing company.
Defensor described the Korean coaches as commuter trains similar to those in use by the Metro Rail Transit (MRT), which, with their wide aisles, can hold from 120 to 150 passengers .
But with commuters sitting on a hard surface and facing each other, the coaches may not be feasible for long-distance travel.
The refurbished ones—with seats and comfortable leg room similar to those in a plane’s business class section—are more suited for the long Bicol route that can last up to six hours, Defensor said.
He said fixing old trains was less expensive at P5.3 million per coach than purchasing a new one at P100 million.
Defensor said the long-term goal was to develop a railway system not unlike those in New York and Rome.
The idea is not far-fetched, he pointed out, especially with the impending connection of the MRT with the Light Rail Transit Line 1.
Defensor said there was also a plan to put up “a highway on top of a railway” to connect the North Luzon Expressway and the South Luzon Expressway.
“It will be shorter, and their cost will be less,” he said.
Jeremiah F. de Guzman
STATE-OWNED Philippine National Railways (PNR) yesterday inaugurated new train coaches and railroad tracks as a result of a $59-million upgrade.
Railway officials also inked a deal to build a highway over railroad tracks to connect Luzon’s two main expressways at the cost of P16 billion, and agreements with mall operators for commercial spaces in train stations.
Manuel D. Andal, PNR general manager, said the rehabilitation project was funded through a loan facility with Korean Export-Import Bank.
Six new trains were purchased for this project, while three were refurbished. Three more will be delivered next month.
Mr. Andal said operations start today with just two rounds, in the morning and in the afternoon.
"We are still in the trial period. We’ll study first the cost of operations so we can come up with fare schedule. For the meantime, we will follow the old fares that start at P12," Mr. Andal added.
"We are expecting over 100,000 passengers everyday in our first year and we target to reach around a million each day in the next few years."
Alongside with the inauguration was the signing of agreements with private investors.
The construction of a highway connecting North Luzon Expressway (NLEx) and South Luzon Expressway (SLEx) over the PNR’s right of way will be in partnership with Metro Pacific Tollways Corp.
"The road construction alone between Buendia station and C-3 station will cost around P16 billion," Ramoncito S. Fernandez, Metro Pacific Tollways president and chief executive officer, told reporters.
Rodrigo E. Franco, president and CEO of Manila North Tollways Corp., said the total length of the connecting highway will be 13.24 kilometers.
Mr. Fernandez also said P4 billion would be allocated for road construction from the C-3 Road train station to Valenzuela, bringing the total investment to P20 billion in a period of two to three years.
A deal was also signed yesterday with SM Investments Corp. and S. T. Best, Inc, an affiliate of SM Group, for the takeover of train stations to build station malls.
Riqui Raymundo-Hizon, president of S. T. Best, said almost all stations from Caloocan to Alabang will have station malls using the PNR property.
"Small station malls will be built by S. T. Best and the major ones will be by SM. We still don’t have any particular amount allocated for this project but whatever it needs, we’ll come up with it," Ms. Raymundo-Hizon said.
Two other deals include a partnership with Lacosta Development for a fiber-optic project on the right of way of PNR, and with Railways and Industrial Heritage Society of the Philippines, Inc. for a museum at the old Paco Station.
Tuesday, 14 July 2009
President Gloria Macapagal-Arroyo will formally launch tomorrow (Tuesday, July 14) the new trains of the newly-revitalized Philippine National Railways (PNR) and unveil the PNR corporate logo in ceremonies at Tutuban Station in Tondo, Manila.
The new trains will provide the public efficient and cheaper mode of transportation aside from spurring economic development in the Metropolis and southern parts of Luzon.
Slated to welcome the President at the launching site, are Vice President Noli de Castro, PNR chairman Michael Defensor, PNR General Manager Manuel Andal, Transportation and Communications Secretary Leandro Mendoza, and Manila Mayor Alfredo Lim, among other officials.
The Chief Executive will then lead the unveiling of the new PNR corporate logo.
The President, along with the PNR officials, will then ride the new train from Tutuban to Buendia.
During the 20-minute ride, the President is expected to interact and converse with the PNR Suking Pasahero.
The newly-revitalized PNR has introduced the following to its railway system: a recently acquired tract maintenance equipment, a prototype unit of an old coach that was fully refurbished with a new body manufactured in the Philippines, and a Korean manufactured Diesel Multiple Unit (DMU) train which consist of three cars, namely, two Driving Motor Railcar (DMR) with driver’s cabin an one intermediate Trailer Railcar (ITR) without driver’s cabin.
The new trains will now serve the commuting public bound to and from Tutuban and Alabang PNR stations.
In the early 2000s, the Philippine government underscored the need to rehabilitate the Northrail and Southrail lines, both aimed at increasing tourism and providing the public with an efficient and speedier form of transportation within the island of Luzon.
Construction has already begun on the rehabilitation of Northrail and Southrail and creating Northrail-Southrail linkage (which previously did not exist). Both China and Korea are involved with these projects.
The North and South rail projects will be upgraded from the present-day single track to a dual-track system, (separate tracks for north and south bound trains to allow for simultaneous operation) and will be capable of speeds from approximately 80 to 130 kph. (PND)
Group aims for certification, skills improvement
MANILA, Philippines – A newly-established group is looking to professionalize Web design in the country, eyeing a burgeoning services market overseas.
Established early this year, the Philippine Web Designers Organization (PWDO) aims to become the premier professional organization for web designers in the country.
The group recently held its first major conference attended by more than 200 Web designers and digital artists.
In an interview, the group’s spokesperson Regnard Raquedan said their initial goal is to establish a community composed of designers all over the country.
Web design has been both a profession and a hobby among many Filipinos for years. About ten years ago, small independent companies established themselves creating websites for corporations and other organizations.
Freelance individual designers also became common as software such as Adobe Dreamweaver and Microsoft FrontPage became readily available. Schools also began offering Web design courses even on the Internet.
Raquedan, however, said Web design has been taken for granted due in part to the availability of software that made it simple.
“Before, making a website required the creator to make a website look great and functional. They can tweak it anyway and add new features and functions. Now, they can just use templates,” he said.
He also noted that a lot of Filipino Web designers have been providing freelance services abroad. The PWDO is envisioning the Philippines to become a hub for outsourced design services.
While this particular business continues to flourish, potential clients need to be familiar with the skills available.
Raquedan said his group envisions third party certification for Web design in the Philippines. They also look to help train designers in developing their skills further and also to establish ethical and best practice guidelines.
“We’d like to make Filipino Web designers more reliable for an international market and make them more innovative,” Raquedan said.
Max V. de Leon
THE fledgling domestic industry of wedding organizers, products and services providers will be intensifying its efforts to make the Philippines the wedding capital of Asia and overtake Thailand as the preferred destination for foreign couples who want “to tie the knot” in an offshore location.
Nona Clemente, president of wedding planner Creative Concepts Co., said among the initiatives that they are lining up is a four-city road show in the US West Coast in September to make a pitch for the different wedding destinations in the Philippines among American and Filipino-American newly engaged couples.
Aside from this, Clemente said they will be participating in several bridal shows to showcase what the Filipino providers of wedding-related services and products can offer.
They have also launched an online community, the www.dreamweddingsphilippines.com, that features the different locations in the country that are ideal for wedding, as well as Filipino firms that are in the wedding essentials business.
“We have the best wedding suppliers in the Philippines. Filipino suppliers are really very creative. In fact, two or three of the top videographers in the world are Filipinos. We are good in innovating and creating, we think of what to display, we really prepare for it and conceptualize,” Clemente said.
Right now, Clemente said foreigners, particularly the Caucasians, are starting to come to the Philippines but the number is still too small compared with what Thailand is attracting.
But with the support that they are now getting from the Department of Tourism, Clemente said it is not far-fetched that the Philippines will become the wedding capital in Asia.
She said aside from the Filipino talent, the Philippines has numerous centuries-old churches all over the country that will surely catch the fancy of Catholic couples.
For non-Catholics, Clemente said the country has the best beaches in the world.
Outside the Box
Last week it was announced that some 500 high-paying, career-building jobs left the Philippines. If these jobs has been lost due to the global slowdown affecting our export business, several politicians would have immediately been all over the television with their advice.
If several jumbo jets had landed at Ninoy Aquino International Airport with 500 returning overseas workers, government officials would have met them at the airport promising help and training. If these jobs had been lost due to a major manufacturing firm closing shop, local pundits would have written extensively with their personal solution to the “problem.”
This story of job losses never appeared on television, in the press, but was met with silence.
From the Western Australian Today newspaper website on October 10, 2008: “More than 500 Telstra call-center jobs are to be transferred to the Philippines.” Telstra is the largest telecommunications company in Australia, serving 9.7 million mobile subscribers.
From The Australian newspaper website on July 8, 2009: “A Telstra spokesman on Wednesday said the Philippines-based service, which had operated for about six months, had not satisfied Telstra’s Australian customers.”
“Queensland Consumer Watch spokesman Paul Tully said: ‘Since January, all Telstra memo calls were unanswered by poorly trained Filipino staff whose skills in Tagalog far exceeded their English language ability,’ Mr. Tully said. ‘Telstra customers have complained non-stop of messages with wrong numbers, wrong names, misspell (sic) and confusing word combinations being received. The past six months has (sic) been utter pandemonium for Telstra customers.’”
My personal opinion is that Mr. Tully is an idiot. But he has his own agenda, so we can understand where he is coming from.
Filipino call-center agents do not need my defending them from these sorts of comments. However, I do know this business from the ground up. I have personally taken thousands of customer-service calls, managed call-center agents, and have been managing director of an outsourcing firm. I can say that Filipino call-centers agents are the best in the world, having seen the performance of our greatest competitor, India.
There is a unique dynamic that occurs when English-speaking customers from England, the USA or Australia make a service call and talk to a Filipino. These same customers would not think for a moment about buying imported goods produced in foreign countries, sometimes manufactured by near-slave labor employees or by underage children. Yet when they pick up the telephone and their call is answered by a Filipino, suddenly they become very nationalistic, screaming about and often cursing the Filipino agent who is trying to help them.
In fairness, the overwhelmingly vast majority of overseas customers calling to the Philippines sincerely appreciate the incredibly high degree of service and respect they receive. Often these customers are amazed if they find out that their needs are being handled by a person halfway around the world who works all night to help them.
No people on the face of the earth have the Filipino heart and soul that allow for the level of customer care that local agents can give.
However, Mr. Tully is correct about one thing. English-language skills are critical and too often, as we all know, we are falling short.
I do not envy the agents who worked on the Telstra account. Australian English is one of the most difficult of all English accents to understand. Every English-speaking nation, including the Philippines, has a variation of accent; American, Indian, British, Canadian, Irish, even Singaporean and South African. I am not sure even the Aussies always understand other Aussies.
Yet there is a fundamental problem with our English skills, and this fact needs to be repeated over and over again until the message gets through. We cannot afford to do otherwise.
Remember, English was the first national language of the country. When the 1935 Constitution mandated “steps toward the adoption of a common language,” that was written in English. Salvador P. Lopez, media icon, University of the Philippines president, journalist, wrote in The Future of Filipino Literature in English (1940) that, “There is nothing in the Filipino soul that cannot be transmitted through the medium of English and which, when transmitted, will not retain its peculiar Filipino color and aroma.”
We must get serious and remain serious about English. You want more jobs for young Filipinos at home? If current trends continue, outsourcing will employ one million people in three years, more than twice the number in the electronic-export business about which everyone is so concerned. Outsourcing remittances will nearly equal overseas worker remittances by 2011.
Paraphrasing the words of an American client to a local call-center director, “You want more of our business, teach your people to speak better English.” Every call-center recruitment ad says that a requirement is to be fluent in English. Yet 95 percent of all applicants never make it through the first interview because they cannot speak basic conversational English.
Our political leaders are not doing their job well enough on this issue. Government funding for English education is totally inadequate. The loudest voices are those promoting a false and phony nationalism based on the “Filipinoism” of using the vernacular.
President Manuel L. Quezon said, “Language has no nationality. It is nationality that gives the name to the language when it adopts it.” We should be proud and teach pride in intelligent, well-spoken, world-class “Filipino English.”
PSE stock-market information and technical-analysis tools were provided by CitisecOnline.com Inc. E-mail comments to email@example.com.
Geefe P. Alba
CAGAYAN DE ORO CITY — Adidas Philippines, Inc. is expanding its sales network in Mindanao, where sales of sports wear and shoes are increasing despite earlier projections of a business slump from the global economic downturn.
"We will open new stores in Mindanao starting in this city because the malls are near residential areas where [stores are] more accessible compared with bigger cities," Adrien Semblat, Adidas Philippines’ senior manager for key accounts, said on Friday.
Shopping malls closer to residential areas would be good locations for the company’s shops considering sales of personal items are generally high during weekends.
Mr. Semblat attended the opening of the seventh Sports Central outlet, an affiliate of SM Prime Holdings, at this city’s SM City Cagayan de Oro. An Adidas franchisee, Sports Central invested at least P1.2 million for the opening of the Adidas concept store here.
Rodel Mercado, Sports Central senior marketing manager, said the reason for opening a concept store here is increasing sales in local outlets during the last few months. This was in the backdrop of wide-scale retrenchments in Northern Mindanao’s manufacturing plants in the first quarter of the year.
An economist from a local university said consumers were shifting to buying smaller and personal items during hard times instead of bigger durable goods such as cars and expensive appliances.
Mr. Mercado said: "The consumers here purchased high-quality products and we have seen that in our surveys." These consumers were mostly young professionals, and demand from this segment allowed the firm to meet sales quotas in the last few months, he said.
Mr. Semblat said Adidas Philippines believes its local market is not affected by the slowdown.
Another Adidas concept store will be opened at the SM City North Edsa by the end of the month. The ninth store will be opened by the third week of September in SM City Iloilo.
Monday, 13 July 2009
By Abigail L. Ho
Philippine Daily Inquirer
MANILA, Philippines - The country's business process outsourcing sector may soon play host to more nontraditional clients, as companies from several parts of the world consider offshoring to reduce costs.
Benedict Hernandez, president of the Contact Center Association of the Philippines, said countries such as the United Kingdom, Australia, Singapore and Canada were increasingly considering offshoring options.
With the Philippines’ good reputation in the global BPO industry, he said these nascent markets were showing growing interest in bringing business into the country.
“We’re on the proof-of-concept stage here. It will still take some time to build a critical mass of awareness among these new markets,” he said. “It will probably take another two years to develop these markets. It usually takes three years, and we’re now on the first year, so we have two more years to go.”
If the country would be able to penetrate the non-United States market, he said Philippine-based BPO providers could gain access to about 10 percent of the $4-billion global market for contact center services.
In the meantime, CCAP executive director Joselito Uligan said the Philippines had also begun to catch the eye of small and medium businesses in the US that had just started to realize the benefits of outsourcing and offshoring.
“More companies that have never considered outsourcing before are now looking at offshoring,” he said. “The SMB sector in the US is growing, and companies from that sector are looking at the Philippines (as a possible offshoring site).”
This emerging trend, he said, would provide a wider market for small and medium-sized call centers operating in the country.
Software firm Oracle partners with AMA University
MANILA, Philippines – Database business software firm Oracle is setting its sights to make the Philippines as a major source for database systems experts.
Ryan Guadalquiver, Oracle Philippines managing director, said the Philippines has among the most technologically savvy students. In particular, there is also an increase in student enrollment in IT courses in the last few years.
Guadalquiver said the need for more database experts is due in part to the huge demand for IT staff in the Philippines and abroad.
The company recently opened its first Oracle Academy facility at the AMA University Makati Campus. Under the partnership, 22 AMA schools will integrate advanced computer science and enterprise business application programs into their curriculum.
Among the subjects to be integrated with the Oracle Academy programs are computer science, information technology and information management.
Some AMA faculty will also be trained on Oracle database and middleware software under the partnership.
Around 5,000 students are expected to enroll in program.
“Oracle Academy and AMA are investing to develop the country’s IT community and create advanced technical learning opportunities for students,” Guadalquiver said
Oracle previously signed a memorandum of agreement with the Department of Education to incorporate Oracle Academy program into DEPED’s secondary curriculum.
This year, Oracle is investing $2 billion for its global Oracle Academy initiative. The program is present in at least 80 countries.
Top destination for high-value services
By Annelle Tayao
Philippine Daily Inquirer
With better technology, collaboration and education, the Philippines could very well pave a promising future for the global architecture, engineering and construction (AEC) industry.
This was the general sentiment of international experts who spoke at the recent “Building from the Ground Up,” a forum on different trends and advancements that the local AEC industry can capitalize on.
The day-long event held on June 29 at the Ayala Museum in Makati was spearheaded by Cirdia Foundation, the corporate social responsibility arm of multinational AEC company Cirdia Ltd.
Speakers at the forum were: Scott Simpson, senior director of architecture and engineering firm Kling Stubbins, and co-author of “The Next Architect: A new Twist in the Future of Design”; Emmanuel Samuel, AEC industry sales development director for Autodesk Asia Pacific; Michael I. Ramos, Southeast Asia, Australia and Korea facilities and services director and senior executive of Accenture; and Egidio Zarrella, global partner in charge of IT advisory practice at KPMG, a global audit, tax and advisory service firm.
Zarrella’s presentation provided an overview of how the Philippines is positioning itself in the global AEC field. “[With] the global financial crisis, there is a major shift from the west to Asia. The needs for architecture, construction are substantial in Asia,” said Zarrella.
He added that the Philippines was one of the top five countries that his company, KPMG, recommend its clients to outsource and offshore to.
“Why the Philippines? Because there’s a great literacy here, a great talent pool and [the people] are able to culturally fit with the West,” said Zarrella.
Zarrella also stressed the importance of education.
In what he called the “global chess game”—wherein governments, private enterprises and universities all play a role in the AEC sector—he noted that international companies would only go to countries with an educated workforce.
“Talent, and educated talent, is what the global industry needs,” he said.
Labeling the AEC industry as “the most conservative industry” compared to others, Samuel discussed how productivity in the AEC sector is directly related to its use of technology.
He added that in a global study done by Autodesk and Stanford University, productivity in the AEC industry has been on a downtrend in the past 20-30 years.
“The AEC [industry] is probably the industry that produces the least amount of technology…and it’s such an economic guardian, but we neglect that,” he said.
Samuel also compared the AEC sector to “worldwide wrestling, [wherein] architects don’t like engineers and engineers don’t like architects,” an issue which was addressed by Simpson in his talk about two “game changers” for AEC: Integrated project delivery (IPD) and business information modeling (BIM).
“IPD, is a process change,” said Smith. “You have architects, contractors and owners, but they are not bound together…by a common relationship. There’s nothing that integrates the entire design community. IPD is going to change all that. You now have the means to have a single organization that binds the owners, architects…[under] one contract. We have more brains at the table.”
BIM, on the other hand, is a technical change that allows architects, engineers, builders and owners to explore a project’s key physical and functional characteristics digitally before it is built.
“The technology allows us to work in ways we’ve never worked before,” said Smith.
Special attention was also given to the employees’ workspace by Ramos.
“With technology advancement in this borderless world, the workforce makeup has changed as well,” he said. “We have to evolve around that.”
Citing Workplace 2.0, a workplace standard started by Accenture in 1992, Ramos listed the four Es of an effective workspace: Efficiency, which focuses on AEC employees’ location; effectivity, which looks at the presence of needed technology; engagement, which centers on how employees identify with their respective companies; and environment, which puts importance on what resources will be left for future generations.
Three pilot sites of Accenture follow Workplace 2.0, said Ramos. Two are in Japan and London, and the third one will be opened in Houston by August.
Also at the forum was Dean John Joseph Fernandez, president of the Council of Deans and Heads of Architectural Schools of the Philippines, who talked about challenges in producing globally competitive design professionals, as well as career options for aspiring architects.
Winners of Cirdia Foundation’s Red Point Awards Thesis Competition, which awarded the best undergraduate architectural theses in the country for the school year 2008-2009, were also recognized at the forum, as well as the top junior architecture student of Mapua Institute of Technology, a beneficiary of Cirdia’s Lines to Lives Academic Excellence Program.
Cirdia says the forum is just the first in a series of discussions that it intends to hold to further improve the country’s chances of cashing in on the outsourcing of architectural requirements, among others.
“The ‘Building from the Ground Up’ forum is a milestone not only for Cirdia Foundation but also for the Philippine AEC sector,” said Cirdia Foundation president Catherine Ileto. “We are one step closer to making the Philippines the premier destination for AEC services and solutions.”