Thursday, 27 December 2012

PHL is 2nd most giving country in SEA, 17th worldwide


MANILA, Philippines - When it comes to selfless acts, Filipinos are among the region and the world's best people.

The Philippines is the second most giving country in Southeast Asia and the 17th among 160 countries worldwide in 2012. This is according to the World Giving Index compiled by the UK-based Charities Aid Foundation based on data gathered by Gallup, Inc., an international research-based performance management consulting firm.

The index is based on an average of three measures of giving behaviour: the percentage of people who donate money to charity, volunteer their time, and help a stranger.

The latest ranking is a big leap for the Philippines. The country only ranked 32nd in 2011 and 50th in 2010 worldwide and fourth in 2011 and fifth in 2010 in Southeast Asia.

In 2012, the Philippines' giving behaviour in terms of volunteering time rose to 44 percent from 41 in 2011 and only 27 in 2010.

Worldwide, the Philippines is fifth in 2012 in terms of volunteering behavior.

"Volunteering is particularly commonplace there, with more people volunteering than in any other country in the region," said the 2012 index report.

Friday, 21 December 2012

S&P upgrades Phl outlook to positive

By Prinz P. Magtulis

MANILA, Philippines - The Philippines’ bid for an investment grade got a boost yesterday after Standard & Poor’s (S&P) Rating Services upgraded its credit rating outlook for the country from “stable” to “positive” on the back of strong confidence to the Aquino administration.

The upgrade indicates the country, which has a BB+ long-term foreign-currency rating from S&P, could notch its first-ever investment grade rating over the next 12 to 18 months. Such a status would mean lower debt interest payments and attracting more foreign investments.


Monday, 17 December 2012

Philippines: one of the next 11


Friday, 14 December 2012

Philippines Peso Gaining as Overseas Workers Top Mexicans: Jobs

Karl Lester M Yap

Government projects in the Middle East, spurred by the Arab Spring and the global financial crisis, are drawing Filipino engineers, nannies and office workers. The rise may propel the Southeast Asian nation ahead of Mexico this year to become the world’s No. 3 in remittances, behind India and China. The funds account for about 10 percent of the Philippine economy.


Thursday, 29 November 2012

Philippine economy grows thanks to private sector

Jojo Robles
Manila Standard

With almost no help at all from government, the national economy grew impressively and beyond all expectations in the third quarter. And the top Aquino administration finance official said this is proof that “Aquinomics” is supposedly working.

It’s true that the gross domestic product rose by 7.1 percent from July to September. But before government tries to grab all the credit for this good news, it’s important to see how the surprising growth took place.

According to National Statistics Coordination Board, which released the official economic figures on the third quarter yesterday, the growth was driven by the services sector, which grew by 7 percent during the period. The industry sector also posted growth for the fifth consecutive quarter, growing by 8.1 percent, while good weather made the agriculture sector expand by 4.1 percent.


Indeed, despite the claims of administration officials, it was the private sector that did all the heavy lifting during the period. There were no major, big-ticket government projects begun, no significant private-public partnership schemes that went online, no arrival of significant investments (the foreign direct kind, not the hot-money variety that is flooding the stock market) as a result of novel government schemes like tax holidays and such like.

To borrow one of President Noynoy Aquino’s favorite expressions, “minana lang namin ito” [We just inherited this]. Of course, Aquino often says this when referring to the supposed problems that he has had to deal with that were left behind by his predecessor.


Indeed, by far the best thing that Aquino ever did for the economy was not to do anything—or not to do enough damage to things that he knows nothing about. One of these is retaining Bangko Sentral ng Pilipinas Governor Amado Tetangco.

Tetangco has helped keep a tight watch on interest rates, dollar reserves, the exchange rate and the banking industry, fine-tuning the economy as it weathers the continuing economic slowdown that is besetting both the Eurozone and the United States. Aquino’s economic managers, on the other hand, have only scared investors with their tax-to-the-max schemes, the unfriendly and protectionist regulatory environments they have created and their failure to rein in smuggling and meet revenue targets.


Wednesday, 28 November 2012

Philippine billionaire to spend big

Arno Maierbrugger

Andrew Tan, a Filipino billionaire who engages in real estate, liquor and fast food, plans to spend $1.5 billion to triple his Alliance Global Group Inc.’s hotel rooms and become the nation’s largest hotel owner as the country lures more tourists, according to a report by Bloomberg.


Property boom in the Philippines

Justin Calderon

The Philippines is in the midst of a property boom that is shifting Manila’s skyline upwards and redefining its status in the world as a viable business hub after a drawn out and undesirable reign as  the “sad-sack” of Southeast Asia.

Office space leasing this year is predicted to hit new heights, setting a record of 400,000 to 450,000 square meters, up 25 per cent from last year, according to property managers and consultancies Jones Lang LaSalle and CBRE Philippines, one of the country’s largest firms in that segment.

Pointedly, increased confidence in the rising Philippine economy, which enjoyed 6.1 per cent GDP growth the first half of 2012, has led to office space being snatched up even before completion.

“Pre-leasing is back,” said Rick Santos, chairman of CBRE was quoted by Reuters. “We are now experiencing the best real estate market in the Philippines in the last 20 years.”


Philippines GDP hits 7.1% 3Q

Beating expectations, the domestic economy accelerated for the third consecutive quarter to 7.1 percent this year from the 3.2 percent last year.  The beyond expectation third quarter growth was driven by the Services sector with the robust performances of Transport, Storage  & Communication, Financial Intermediation, and Real Estate, Renting & Business Activities supported by the five consecutive quarters of sustained accelerated growth of the Industry and the seemingly weather tolerant Agriculture sector.  With the upwardly revised second quarter Gross Domestic Product (GDP) estimate, the growth for the first nine months of 2012 at 6.5 percent surpassed the upper end target of the 6.0 percent for the whole year.

On the demand side, increased consumer and government spending, increased investments in Construction, and the third consecutive quarter of growth in external trade contributed to the highest quarterly growth since the third quarter of 2010.

The rebound of the Net Primary Income from the Rest of the World by 4.9 percent pushed the Gross National Income (GNI) to grow by 6.6 percent from 2.2 percent in 2011.

On a seasonally adjusted basis, GDP grew by 1.3 percent from 1.2 percent while GNI grew at a slower pace of 1.2 percent in the third quarter from 1.4 percent in the second quarter of 2012.  Agriculture, Hunting, Forestry and Fishery sector grew by 0.2 percent, a slowdown from the 1.7 percent in the previous quarter while Industry accelerated at 2.1 percent from 0.2 percent with all subsectors except for Mining and Quarrying contributing robustly to the growth.  On the other hand, the Services sector recorded a 1.0 percent growth for the third quarter of 2012 from 1.7 percent in the previous quarter with the positive growth of all its subsectors.

With projected population growing by 1.7 percent to 96.0 million, per capita GDP grew by 5.3 percent, per capita GNI accelerated by 4.8 percent while per capita Household Final Consumption Expenditures (HFCE) upped its growth by 4.4 percent.

Secretary-General, NSCB

Monday, 26 November 2012

New train arrives for UP-Diliman's automated transit system


Philippine Railways on Sunday announced the arrival of the new University of the Philippines train, which will be used in the first Filipino-built Automated Guideway Transit (AGT) System within the Diliman campus in Quezon City.

The blue and white train bears the logo of the Department of Science and Technology as well as the University logo on one side.

DOST is in charge of the design and detailed engineering plan of the AGT, while UP gives technical assistance and implements community relations activities, a previous report said.

The DOST and UP will conduct test runs of the train on a 500-meter elevated concrete track, according to a report by Anna Kristine Regidor on the UP website.

If the results are favorable, the AGT prototype may be designed to run throughout the entire UP Diliman campus, the report said, adding that the next phase of the project is an intracampus loop that will run approximately 6.9 kilometers.

"Ikot jeepneys" are the most common mode of transportation around the 493-hectare campus.

Moreover, the report said the DOST created an earlier prototype of the AGT in Bicutan, using a straight 150-meter track. The UP Diliman campus is a chance to test the system on a curved and circular track.

President Benigno Aquino III cited the project in his State of the Nation Address in July 2011.

According to the president, the monorail system "could potentially provide a home grown mass transport solution that would cost us as little as 100 million pesos per kilometer, much cheaper than the current cost of similar mass transit systems."

"The potential savings could result in more kilometers of cheap transport, decongesting our urban centers and allowing rural communities easier access to centers of commerce and industry," Aquino said.

Aside from serving the UP Diliman community, the AGT is expected to be a harbinger of the future of mass transport systems developed and made locally by Filipinos, an earlier report said.  — LBG, GMA News

Saturday, 24 November 2012

Philippines Set to Edge Mexico for Remittance-Olympics Bronze

Eric Bellman
Wall Street Journal

The Philippines’ globetrotting dream team of more than 8 million overseas workers is set to surpass team Mexico in the amount of money sent home—which would be the first time in 17 years.

The World Bank projects official remittances to the Philippines at just over $24 billion this year. That gives it a third-place bronze medal behind China and India, each projected to receive more than $65 billion, and just ahead of Mexico, whose migrant workers are projected to send home a bit under $24 billion.

Like its boxing sensation Manny Pacquiao, the Philippines punches way above its weight class. Its migrant workers remit close to 40% of what Indian and Chinese workers do, even though its population is less than 8%  of those Asian titans’.


Pinoys In Demand Among Big Oil Companies – Cuisia

Manila Bulletin

MANILA, Philippines--- Filipino workers are very much in demand among the big oil companies because of their skills and experience.

Philippine Ambassador to the United States Jose L. Cuisia Jr. disclosed this following his visit to New Orleans to look into the conditions of Filipinos affected by the explosion and fire that hit an oil platform off the coast of Louisiana last November 16.

He said Filipino workers were cited for their safety-conscious attitude, work ethic, knowledge of their respective craft, ability to communicate well in English, and their overall attitude toward the work

“Many of these welders, fitters, and riggers have many years of experience and the companies they are employed in have expressed their satisfaction and admiration for their work ethics,” said Cuisia. “This is why the Filipino workers are highly valued and very well compensated.”

Special attention is now focused on Filipino workers who, unknown to many, played a crucial role in restoring oil production in the Gulf of Mexico in the aftermath of Hurricane Katrina seven years ago.

Cuisia said that although Filipinos first set foot in Louisiana as early as the 1700s, it was only in 2005 that workers from the Philippines started making their presence felt in the offshore oil industry in the Gulf of Mexico.

It was Grand Isle Shipyard, Inc. (GSI), a highly diversified oilfield service company based in Galliano, Louisiana, who brought the Filipinos to the Gulf of Mexico following the destruction wrought by Katrina in August 2005.

In November 2005, when many of Louisiana’s oil platforms were destroyed by the typhoon, GIS hired an initial crew of 24 men from the Philippines and by early 2006, there were more than 350 Filipinos working in the Gulf of Mexico.

Cuisia said he was informed by GIS Operations Manager Mark Pregeant that Filipinos contributed over 500,000 man-hours throughout that six-month period to help restore oil production in the Gulf of Mexico

Pregeant told Cuisia that without the help of the Filipino oil workers there would have been “significant delays.”

Cuisia pointed out that Filipinos are not new to the oil and gas sector as they have been working in oil fields, refineries and offshore platforms in the Middle East, Africa, Europe and Australia as early as the 1970s.

Citing current available statistics provided by the Philippine Overseas Employment Administration, the Philippine envoy said as many as 40,000 Filipinos are working in the offshore oil and gas industry in various parts of the world as of November.

Almost 2,000 of them are working in the US, including Louisiana, which accounts for 23 percent of total US crude oil production.

In particular, Cuisia noted that the nine Filipinos, who figured in the explosion and fire that hit the oil platform they were working off the coast of Louisiana last week, belong to a pool of highly skilled workers with an average 10 years of experience working in various oil and gas sector projects overseas.

The accident left one Filipino worker dead, four others seriously injured, and one other missing. It has placed the spotlight on workers from the Philippines.

Meanwhile, Cuisia announced that the respective family members of the Filipino oil workers who were affected by the recent fire in the oil platform in the Gulf of Mexico are now en route to and are expected to arrive starting Thursday (Friday Manila time) in New Orleans.

Cuisia said the Philippine Consulate General in Chicago will be assisting family members of the lone fatality, the four seriously injured worker and the missing worker when they transit through O’Hare International Airport on their way to New Orleans.

In a report to Cuisia, Consul General Leo Herrera Lim of the Philippine Consulate General in Chicago said that there have been no changes in the conditions of the four Filipinos currently undergoing treatment for the serious burns they sustained in the incident.

Two remain in critical condition and the third is still serious, while the fourth is improving.

On the other hand, preparations for the repatriation of the remains of the lone fatality, Ellroy Corporal, 42, have started after these were turned over by the Coroner’s Officer to a local funeral home.

Cuisia also revealed that Black Elk, the Houston-based independent oil and gas firm that owns the ill-fated platform, suspended early this week the formal search and rescue efforts for missing worker Jerome Malagapo, 28, after more than 100 hours of operations that encompassed more than 1,400 square meters of waters in the Gulf of Mexico.

Black Elk said the search involved three commercial dive boats, search and rescue dogs, beach and near shore searches and several helicopter companies that fly in support of surface search efforts.

“We will continue to remain focused on the victims and their families, including those injured in the incident. An official investigation is underway and we will continue to cooperate with all authorities,” Black Elk said in a statement.

In New Orleans, investigators from the Bureau of Safety and Environmental Enforcement of the Department of Interior interviewed the three Filipinos survivors to determine the cause of the fire that struck their oil production platform. The three were accompanied by Welfare Officer Saul de Vries when they gave their testimonies to investigators.

Also, earlier this week, John Hoffman, President and Chief Executive Officer of Black Elk Energy, called Ambassador Cuisia to express his condolences and to assure the Embassy that the company will extend its assistance to the families of the affected workers who will start arriving in the US.

Friday, 23 November 2012

BIR Collection Topping P1 Trillion

Manila Bulletin

The Bureau of Internal Revenue (BIR), the government’s main tax agency, said yesterday that its collection this year will exceed P1 trillion mark.

BIR Commissioner Kim S. Jacinto-Henares said that the agency is working hard to raise the needed P208-billion collection in the final two months of the year to meet the P1.066 trillion target for 2012.

“I’m confident that we will meet the P1 trillion mark, but when it comes to our full-year target, I can say that we’re working hard to achieve it,” Jacinto-Henares said.

As of October this year, the BIR collected P858.6 billion, higher by 13.45 percent compared with P756.7 billion in the same period last year.

The BIR’s end-October collection, however, was short by 3 percent against the P886,5 billion target for the period.

In November, the BIR is expected to raise P102.9 billion and another P76.6 billion in taxes in December.

Last month, the BIR also achieved its collection target by generating P86.1 billion in collection, short by P800 million against the P86.18-billion goal.

Year-on-year, the BIR October collection grew by 22.13 percent from P70.5 billion.

In October, collections from BIR operations reached P83 billion, an increase of 20 percent compared with the same month last year, also exceeding the P82.4-billion goal.

Meanwhile, collections from non-BIR operations increased by 140 percent to P3.15 billion from a year ago, but short by 17 percent compared with the target.

Collections by the Regional Offices amounted to P33 billion in October, higher by 39 percent compared with the same month last year, continuing with the trend of double-digit growth being registered by cluster for this year.

Regional Offices also exceeded its goal for the month by 14 percent.

Collections by the Large Taxpayer Service, meanwhile, reached P49.96 billion, an increase of 10 percent from a year ago.

Thursday, 22 November 2012

‘Hot’ money is good

John Mangun
Outside the Box
Business Mirror

THERE are two subjects that most people consider themselves knowledgeable about, if not an expert; the human body and money and finances. Just because a person owns a body and has some money in the pocket, does not make a person wise about either.

A person who does know about the body like a physician for example studies for years and never stops learning. The same is true in the financial world.

Take the way money moves around the world, and more specifically, the stock markets.

For the administration to take any sort of credit for the advancing prices on the Philippine Stock Exchange (PSE) only proves my point about “experts.” The correlation between increasing stock prices and a successful and growing economy is often not true.

Between 1962 and 1964, the US economy grew by an average of 4 percent each quarter. The New York stock market went down by 50 percent. Between 1975 and 1977, the market nearly doubled as US growth hit 4 percent. Since 2009, US stock prices have more than doubled and the US economy has been growing at 2.3 percent.

In 2010 the Stock Exchange of Venezuela rose 20 percent while the economy shrank by 4.4 percent. This year Venezuela is experiencing over 20-percent annual inflation. Its stock market is the best performing in the world. Why? Because inflation is running at over 20 percent. When inflation is high or a currency is devaluing, money runs to investments that have the chance of appreciating enough to offset inflationary pressures.

I think that some of my more “progressive” friends believe that businesses operate from the power of magical rainbows and dancing unicorns. Unfortunately, what keeps businesses thriving and economies growing is a constant supply of fresh capital. That is why a viable and vibrant stock exchange like the PSE is vital for economies to develop.

In the last year some P20 billion has been raised by smaller and larger companies through initial public offerings. Nearly an equal amount has been raised through “private placements” of stock to small very large investors, coming from both domestic and foreign sources.

All that money is used to expand and grow business and the PHL economy, and would not be as readily available without our stock market.

One of the silliest complaints from the “experts,” showing absolute ignorance of the financial markets, is how the stock market attracts “hot money.” Hot money are funds looking for a short-term return that also provides quick liquidity. We all have hot money investments. It is called a bank account.

Traditionally, foreign hot money has flowed into a country while seeking to take advantage of a quickly appreciating or depreciating currency as occurred during the 1997 Asian crisis. That will not happen in the Philippines, not with the Bangko Sentral holding $82 billion to stabilize the currency.

This foreign hot money does not come in and out as rapidly as the critics would claim. That is because to exchange dollars for pesos and then go back to dollars would mean an automatic loss of at least 2 percent, or about 80 centavos on the currency buy/sell spread.

One editorial in a local newspaper spoke of a $256 million outflow of portfolio investment from our stock market in October. That does not surprise me in the least. Including the mid-1990s stock market high, foreign investors have tended to buy near the top and sell near the bottom. And too bad for that foreign money that left in October since the market is already up 1.5 percent for November. And the dummies missed the 16-percent price gain in PNB and the 5-percent rise in Ayala Corp.

The editorial goes on to say that this hot money comes in and then leaves as soon as it makes a profit. So what? That is how a stock market should and does function. While hot money flows may not be an indicator of the quality of government economic policy (foreign direct investment measures that factor), it does attest to the quality of the financial and banking system. The PHL scores well in this regard. Further, hot money in the stock market shows, contrary to that same editorial, that the PSE and the regulatory environment, while not being five-star, does function effectively, comparable in comparison to many other global markets.

Foreign direct investment by definition must be cautious and long-term oriented. Hot money is a risk taker, looking at current conditions and more important, short-term national and global trends. Further, if those trends are not favorable, hot money will turn its back very quickly and walk away. Then you know you have a problem.

The overall trend of hot money investments here is favorable and should be further encouraged.

E-mail to, web site is, and Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by COL Financial Group Inc.

Wednesday, 21 November 2012

Pinoy to head biggest amusement association

Rio Rose Ribaya
Yahoo! Southeast Asia Newsroom

A Filipino businessman has been selected to head the largest amusement industry trade association in the world.

Enchanted Kingdom (EK) owner Mario Mamon is the first Asian ever chosen to head the US-based International Association of Amusement Parks and Attractions (IAAPA).


Why invest in the Philippines?

Newest zip -- in Leyte

Monday, 19 November 2012

IMF chief lauds PH: It’s the only nation upgraded

By Michael Lim Ubac, Michelle V. Remo
Philippine Daily Inquirer

MANILA, Philippines—The Philippines is the only country in the world for which the International Monetary Fund has upgraded its economic growth forecast for 2012, according to visiting IMF managing director Christine Lagarde.

Compared with the once-powerhouse economies of Europe and the United States, which are now struggling, the Philippines is on the road to maintaining an average growth rate of 5 percent next year, Lagarde told a press briefing in Malacañang on Friday.


Sunday, 18 November 2012

The new airport will be in Kawit

Emil Jurado
Manila Standard

There has been a lot of speculation about the location of the new airport for Philippine Airlines.  What area would San Miguel and PAL president Ramon Ang choose? Will it be in Bulacan? Laguna?  The idea is that the new airport should be close to Metro Manila, for the benefit of passengers. Clark in Pampanga, two hours away from the metro, is just too far.

To my surprise, I learned that the new airport will be in Kawit, Cavite.  That is, if President Aquino will give his go signal.  The airline has been negotiating with the Remullas.  The runway would extend into the sea. This means reclamation, something within the power of the local government to approve and give permission to.

The Kawiteños are no doubt excited.  The move will give premium to Kawit properties.

Give it to Ang for thinking out of the box. Congratulations, Mon!

Thursday, 15 November 2012

‘Informal’ OFW remittances P242 billion higher

Jun Vallecera
Business Mirror

The amount of migrant-worker remittances passing through informal channels tops those passing through the banks by a wide margin, estimated at some 30 percent to 40 percent by the Asian Bankers Association (Aba).

This was revealed at the conclusion of the meeting of Aba member-countries held at the Shangri-La Hotel on Tuesday, in which issues of common concern like the financial integration by 2020 were discussed, among other things

Read more

Wednesday, 14 November 2012

NEDA: PHL’s 22.8% Sept. exports growth the highest in East, Southeast Asia


The Philippines’ 22.8-percent jump in exports in September was the best among East and Southeast Asian countries for the period, the National Economic and Development Authority said on Tuesday.

The Philippines emerged on top of countries in the region that posted positive exports growth, which includes Hong Kong (15.8 percent), Vietnam (15.6 percent), Taiwan (10.4 percent), China (9.9 percent), and Thailand (0.2 percent).

“The strong export performance mainly reflected the moderate improvement in global economic activity as industrial production and business confidence indicators showed signs of recovery,” said NEDA deputy director general Emmanuel Esguerra.

Other countries reported a decline in exports in September, with Japan recording the steepest fall (-11.8 percent), followed by Indonesia (-9.4 percent), Singapore (-4.8 percent), and South Korea (-2.0 percent).

Esguerra also said that the Philippines is also one of four countries in East Asia and Southeast Asia to have posted positive exports growths in the first three quarters of the year. With 7.2-percent growth for the period mounting to $40.1 billion, the Philippines follows Vietnam (18.3 percent) and China (7.4 percent). Hong Kong's exports grew 1.8 percent in the first nine months to September. — BM, GMA News

UK ‘excited’ over trade with Philippines


LONDON—The Philippines is a “hugely exciting” market where the United Kingdom is keen on boosting reciprocal investment.

Key trade officials here bared this bright outlook, noting that the UK was setting its sights on Southeast Asia as a priority growth area amid the continuing dim prospects in Western economies.

They said the UK hoped to step up trade with growing markets to combat a general sense of pessimism over economic numbers here and in the euro zone.

Nick Baird, chief executive of UK Trade and Investment (UKTI), the state body that links UK firms to the global market, said that British firms were looking at ways to tap the Philippines’ robust economy and invest in major infrastructure, health care and retail-related projects.

“I think that for us, the huge opportunities there are certainly around big infrastructure projects, health… We’re also very interested in areas I would describe as building on and working with countries’ growing middle classes, so [it’s about] providing better education, health services, accessing the consumption of these middle classes through the retail sector,” Baird told Asean reporters on a visit here.

Read more

Watch BBC: Philippines gains in popularity among investors

The Philippines is becoming more popular for international investors.

Manila's stock market was the Asia region's best performer in 2011, and it is doing well this year too.

The BBC's Kate McGeown spoke to Hans Sicat, president of the Philippine Stock Exchange and asked him what was driving investor sentiment in the country.

Monday, 12 November 2012

The Philippines: The world's budget English teacher

Kate McGeown
BBC News, Philippines

The Philippines is fast becoming the world's low-cost English language teacher - with rapid increases in overseas students coming to learn English or study in English-speaking universities.

There might be other countries that people think about as a classic place to learn English, such as the UK, the US or Australia.

But there is one key reason that they are switching to the Philippines. It's much cheaper. And in the competitive market for language students, it means the Philippines is attracting people from countries such as Iran, Libya, Brazil and Russia.

"We have very competitive rates compared with other countries," says English teacher, Jesy King, citing her school's fees of $500 (£313) for a 60-hour class - about a third of the price of an equivalent course in the US or Canada.

Read more

Saturday, 10 November 2012

Foreign bond sale generates $750m

By Anna Leah G. Estrada
Manila Standard

The government raised $750 million from the sale of 10-year peso bonds overseas to help finance the budget deficit and manage its debt.

The Finance Department said in a statement the newly-issued peso global bonds, the third of their kind offered by the country, were priced at 100 percent with a coupon of 3.90 percent.

“The transaction allowed global investors the opportunity to participate in the impressive growth story of the Philippine economy, which is considered today to be one of the safest emerging market sovereigns to invest in,” said Finance Secretary Cesar Purisima.

The proceeds will be used to redeem global bonds denominated in euros and the US currency.

The government, which was originally planning to raise up to $1 billion, cut the issuance size after deciding to buy the additional foreign currency from the Bangko Sentral, according to Finance Undersecretary Rosalia de Leon, who was appointed as the new Treasurer.

Foreign exchange reserves of the Bangko Sentral reached a record $82.1 billion in October, more than double what they were at the end of 2008.

“The yield would have stayed at 3.9 percent even if we got $1 billion,” De Leon said in an interview. “We have a lot of cash. It would help Bangko Sentral ng Pilipinas with the peso if we tap the reserves,” she said.

The government said it sold the bonds within eight hours of bookbuilding process, with 30 percent of investors coming from Asia, 41 percent from the United States and 29 percent from Europe.  Investors bid 7.2 times the amount of offer.

“Positive investor perception of the Philippine credit allowed us to achieve our objective of redenominating our debt into the local currency,” De Leon said.

Credit Suisse, Deutsche Bank and HSBC acted as joint global coordinators, while Citi, Credit Suisse, Deutsche Bank, Goldman Sachs, HSBC, J.P. Morgan, Morgan Stanley, Standard Chartered Bank, and UBS acted as joint bookrunners for the transaction. With Bloomberg

Wednesday, 7 November 2012

Phl finally hosts GT Race Global at BGC

Read more:

MANILA, Philippines - The Philippines will finally get to host one of the world’s most exciting, most watched racing events – the GT Race Global – which zooms off early next year at the Bonifacio Global City in Taguig, with some of the world’s finest drivers behind the wheels of 24 supercars of the rich and famous.

The world’s top-of-the-line cars - Lamborghini, Ferrari, Aston Martin, Corvette, Ford, Porsche, Lotus, BMW, Maserati and Mercedes-Benz – and others sporting engine power ranging from 800 horsepower and beyond will clash for fame and fortune in the event held for the first time in the Philippines.

Monday, 5 November 2012

Sustained Domestic Economic Growth Is Seen To Cap This Year

By EDU LOPEZ Manila Bulletin The Philippine economy is one of the best performing economies in Asia as multinational and financial institutions have projected sustained growth of the country's gross domestic product (GDP). While some Asian economies have posted declines in GDP performance, the domestic economy experienced robust growth in the first half of 2012 and continuous to exhibit strength despite the global and regional economic slowdown. The Asian Development Bank (ADB) has raised its GDP growth forecast for the Philippine economy to 5.5 percent for 2012 from 4.8 percent. Stronger than expected economic growth in the first half of 2012 was broadly based. Private consumption was buoyant, fixed capital investment quickened, public spending rebounded, and net exports contributed to growth. Inflation remains under control at 3.5% for 2012. However, ADB said the economy needs to create more job opportunities to link economic growth to poverty reduction.

Fearless Forecast: PSEi At 10,000

Manila Bulletin

Online brokerage firm COL Financial, formerly, expects the Philippine Stock Exchange Index (PSEi) to hit 10,000 by 2016, almost double the current level.

According to COL Financial president Conrado Bate, they are optimistic that the fearless forecast will happen because, “for the first time in the history of the Philippines, we enjoy a credit rating which is just one notch below investment grade.”

He noted that this is a consequence of the steady improvement in the country’s finances. This includes the country’s foreign exchange reserves which have increased 5 times since 2005, thanks to the strength of remittances and the business process outsourcing sector.

“Our fiscal deficit is a mere 2 percent of GDP (gross domestic product) while inflation has remained under control. Compared to our Asian neighbors, we are also less vulnerable to developments in the US, Europe and China since we are the least export dependent, with domestic consumption accounting for 70 percent of GDP,” said Bate.

He added that the outlook for domestic consumption is also very favorable by 2015, the Philippines will enter what is commonly known as the “demographic sweet spot,” the period where half of its population will be of working age.

“There are also several developments that make us excited about the near future. Investment opportunities are becoming more tangible as the government’s Public Private Partnership projects are gaining momentum,” said Bate.

Meanwhile, he said a solution to the Mindanao problem seems to be at hand, noting that this would add another growth driver to the Philippine economy which in the past had to depend on the islands of Luzon and Visayas for growth.

“As stock market investors, we have this wonderful opportunity to participate in the country’s economic growth, and we believe one of the best ways to partake in this is by investing in the country’s top conglomerates who are poised to invest and grow in our economy,” said Bate.

Peso seen to hit 30:$1 next year

Read more:

CEBU, Philippines -  The peso could strengthen to the 30-level against the dollar next year as investors continue to flood emerging markets regardless of the outcome of the US elections on Tuesday, an investment bank said.

Wednesday, 31 October 2012

Bilib I.T. or not: Prison call center eyed. You've got to "BILIB I.T."

Call centers may soon be run in prisons with inmates as operators, thanks to a program initiated by Sen. Alan Peter Cayetano that aims to help convicts get a better chance to resettle and reintegrate back into society.

The program, dubbed "BILIB I.T.," will grant information technology (IT) scholarships to qualified inmates so they can learn productive skills that will help them get back on their feet.

"We'll see if we can try building call centers inside jail facilities to help these detainees utilize their training and gain employment," Cayetano said in a statement released during the program launch at Taguig City Jail.

"I eventually want to get there because it's a step further toward better rehabilitation," he added.

Among the courses to be offered are Basic IT, Adobe Photoshop, computer hardware servicing and a finishing course for call center agents, which would include English proficiency and web design.

Among the inmates who were given scholarships during the launch were: Alvin Alison, 21; Ronnie Omanitu, 24; Belinda Pagulayan, 48, and Jenny Canlas, 28.

Cayetano said the scholarships will be granted to at least 200 inmates, and is expected to double with the help of the Technical and Education Skills Development Authority (Tesda).

Cayetano cited a similar program in the United States where "inmates do call center work for nonsensitive matters."

Who are eligible for the program?

"Those who have served their sentence but prefer to live inside the penal community due to lack of skills necessary to rejoin the work force, detainees who have minimum security and those inmates with sentences not longer than six years," Cayetano said.

"We should give them a chance to make a living and become productive members of society in the future," he added.

Tesda Director General Joel Villanueva, who was present during the launch, added that more than providing livelihood for the inmates after serving their sentences, it was also about removing the stigma associated with being an ex-convict.

The inmates will look better to prospective employers if they have done work in the detention facility, he added.

Cayetano expressed willingness to work with the Bureau of Jail Management and Penology (BJMP) and the Department of Justice to create guidelines that will allow inmates to be in a job that would enable them to be in direct commercial contact with the public.

The program was launched in cooperation with Tesda, IT school Informatics, BJMP and Taguig Mayor Lani Cayetano.


Tuesday, 30 October 2012

PH among top 10 with least gender disparity

By Ana G. Roa
Philippine Daily Inquirer
Read more:

MANILA, Philippines—The Philippines still leads Asian countries in reducing inequality between men and women, according to the 2012 Global Gender Gap rankings of the World Economic Forum (WEF).

The report showed the Philippines remained among the top 10 with the least gender disparity. It had an overall score of 0.7757, to rank eighth out of 135 countries, unchanged from the previous year.

Monday, 29 October 2012

Philippines take lead in biotech crops

Arno Maierbrugger
Inside Investor
Read more:

The Philippines is pushing ahead collaboration with ASEAN member states and the US to share its know-how on biotechnology in farming and developing genetically modified crops, a move that is aimed at helping farmers improve their productivity, the country’s Department of Foreign Affairs said on October 24.

The Philippines is considered a leader in biotechnology in Southeast Asia, being the first country in the region to have a regulatory system for biotech products in place and the first to grow a major biotech crop for food, feed and processing, called Bt corn, that was approved for commercial production in 2002.

Philippines Is Raised by Moody’s as Investment Grade Nears

By Cecilia Yap and Max Estayo - Oct 29, 2012 3:26 PM GMT+0800

The Philippines’ debt rating was raised to the highest level since the start of 2004 by Moody’s Investors Service, bringing the Southeast Asian nation one step away from investment grade. The peso and bonds rose.

The country’s foreign and local currency long-term bond ratings were upgraded to Ba1 from Ba2, Moody’s said in a statement today. That brings the Philippines on par with Turkey and Hungary. The ratings outlook is stable.

“The writing is clearly on the wall,” said Roberto Juanchito Dispo, president of First Metro Investment Corp., one of the arrangers of the government’s record retail bond sale this month. “The Philippines is definitely on its way to becoming investment grade in due course. This will bring numerous tangible economic benefits to the country.”

A Glimpse of the Philippines

What is driving Philippines' economy?

Cielito F Habito
Philippine Daily Inquirer

It is remarkable that the Philippine economy has been showing dynamism this year, bucking the trend of a sluggish world economy. This implies that the energy driving our economic growth is coming from within. Indeed it is internal demand - that is, we Filipinos ourselves purchasing our goods and services - that has provided the current impetus for heightened economic activity, thereby providing increased jobs and incomes for Filipinos. I will explain some of the evidence on this below.

In basic economics, we are taught that the products and services produced in the economy are bought by four major sectors: private consumers for their consumption needs; businesses and firms for investment in structures, equipment and materials, etc; government for public infrastructure and services, and for its own day-to-day requirements; and foreigners who buy our products and services as exports abroad, or buy them here as tourists. Growth in spending by any or all of these propels growth in the economy as a whole, as increased demand stimulates greater production by the economy's producers.

What's more, any rise in spending by any of these four sectors provokes a multiplier effect that leads to even more growth in economic activity, via a chain reaction of new incomes and consequent new spending. If a company spends 100 million Philippine Pesos (Bt74.4 million) on a new factory, this turns into PP100 million in total incomes received by contractors, engineers, construction workers, suppliers of equipment and construction materials and others. But that's not the end of it. Those various people now have more money to spend or save as they choose. If people save PP20 out of every additional PP100 in income they receive, then the original PP100 million of investment spending turns into a new round of PP80 million in spending on various things such as food, clothing and appliances that those construction people normally spend their incomes on. And since anyone's spending turns into someone else's income, that second-round PP80 million in incomes turns into a third round of spending amounting to PP64 million. This becomes yet another round of incomes spurring yet another round of spending, and so on down the line.

Ultimately, the PP100 million originally spent by the investing firm will actually create five times as much (PP500 million) total production and incomes. The mathematically inclined can figure out that if the saving rate is 20 per cent, or 0.2, the multiplier works out to be one divided by that, or five. So if people tend to save less, say 10 per cent, every spending gets multiplied by even more (that is, 10) and generates 10 times more production and income in the economy. And even more so if those savings are kept within the country, so that the banks receiving it can plough it back into our domestic economy, say by lending the savings to a company that will invest it in a new factory - thereby repeating the same story above.

Official data suggest that there is indeed more domestic spending by consumers, investors and government lately, even as foreign purchases of our products (especially in Europe) have slowed. In particular, government spending has dramatically swung around from a 4.6-per-cent drop in the first six months last year to 12.3-per-cent growth in the same period this year. Government construction spending jumped 55.4 per cent after falling 51.1 per cent last year. Stung by criticism that it directly dragged down the economy last year with reduced spending, the government has now come back with a vengeance.

The data show that firms' investment spending on durable equipment, breeding stock and orchard development and on intellectual property products has likewise sped up significantly from last year's pace. Private consumption growth is similarly brisk at 5.7 per cent. Interestingly, among the strongest sources of growth in people's spending are communication (with our continuing fascination for ever more sophisticated smart phones), restaurants and hotels, and recreation and culture. These suggest that domestic tourism has been a particularly important driver of our growth. One only needs to experience the now common flight delays and overcrowded airports to be convinced that Filipinos are travelling a lot more - and perking up the economy in the process.

The good news is that spending by foreigners on our products - ie, our exports - has lately resumed growth after contracting last year. Even then, the latest figures suggest that the export turnaround may be tentative. But I wouldn't lose sleep over this one. After all, our economy is now speeding along on its own steam, through the Filipinos' own spending, multiplier effect and all.

The PH model for learning English


BANGKOK, Thailand - Never in man's history has the demand for the English language been this great. It has become an indispensable commodity around the world. Globalization, of course, has been one of the main catalysts behind this phenomenon.

It is not uncommon nowadays, for instance, for two individuals of different nationalities to troubleshoot technical problems or place orders in an instant despite the geographical differences that divide them.

California-based Mark only needs to dial a toll-free number to get directed to Manila-based call center agent Geoffrey who takes his call for tech support and asks him some preliminary questions. In a few minutes, Mark gets satisfied with Geoffrey's customer support service. Meantime, Geoffrey waits for another call that may come from the UK or any part of the English-speaking countries.

This scenario has become a 24-hour, 7-day-a-week routine, making it a way of life for many Filipinos in major urban centers in the Philippines.

In a recent study involving the Business English Index (BEI), the only tool that measures business proficiency in English in the workplace, the Philippines surfaced as the world's best country in business English proficiency, even besting the US.

The 2012 results demonstrated that out of the 76 countries that participated in the study, the Philippines was the only country that went above 7.0, “a BEI level within range of a high proficiency that indicates an ability to take an active role in business discussions and perform relatively complex tasks.” This came out even as the Philippines has been reported to have overtaken India as the international hub for call centers.


But how did this phenomenon start? What has made the 20-year-old call center industry in the Philippines successful? Can other non-native speaking countries learn from the Philippine experience? A number of reasons have been cited, but the Filipinos’ competence in the English language tops the list.

In GlobalEnglish Corporation's BEI study, skills such as taking participatory roles in business-related conversations or carrying out relatively complex responsibilities are highly prized. GlobalEnglish also implied that other more basic skills such as being able to “understand or communicate basic information during virtual or in-person meetings, read or write professional e-mails in English or deal with complexity and rapid change in a global business environment” were accounted as well.

Tom Kahl, GlobalEnglish president, noted that being able to convey ideas with ease and work with others within a multinational setting help boost an organization’s finances. The study revealed that the 7.11 score of the Philippines, the only country reaching the intermediate level, may help explain why the country’s economic condition has improved, placing it in the Top 5 in the 2011 and 2012 World Bank GDP data.

Aside from those cited by GlobalEnglish, an executive from an American company outsourcing customer service calls to a Philippine-based call center underscored the value of knowing how to use certain phrases and idioms.

The edge

It may seem fairly basic, but it counts as another factor why English-speaking Filipinos are highly preferred over their Indian counterparts. This may be correlated to a person’s vocabulary and grammar being central to his success or failure in every communication.

In Barry Tomalin’s “India Rising: The Need for Two Way Training,” he cited vocabulary and grammar use as a source of pressure for Indian call center agents. They tend to use “long, indirect questions, which prolong the exchange. Done out of politeness, it can actually be counterproductive as it draws out the exchange beyond what is necessary.”

The use of some words, such as “prepone” instead of saying “bring forward,” or “I will bring the needful” instead of saying “I'll do what is needed,” which may not be clear to multinational clients, further causes miscommunication. In short, knowing standard expressions offers a huge pay-off.

To become effective users of any language, one has to understand also the culture within which the language is used. Braj Kachru, a well-known linguist dubbed the “father” of World Englishes, once said that language and culture are intertwined.

To know and understand any language, one has to know and understand its culture as well. In the case of Filipinos, this does not seem to be a daunting task at all. The Philippines has long been prepared for this. With a century-old history of having been exposed to anything American, the Filipinos are more familiar with Western practices than other Asians.

This criterion might be frowned upon by other non-native English-speaking countries for fear of dampening their people’s sense of nationalism. Of course, for a non-native speaker of English to successfully know and understand the target language, he does not necessarily have to embrace the same set-up Filipinos have.

One practical advice Filipinos offer is that the support system to learn any language at the very least should be present. This means having a ready access to the English language inside and outside the classroom anytime.

External support

In the Philippines, most signages and outdoor billboards are in English, there is a proliferation of Hollywood films in cinemas and American sitcoms on TV – without sub-titles in Filipino, official government documents are in English, as are nearly half of the local songs recorded (even as Top 40 songs from the US enjoy extensive airplay).

Parents use the English language with their children even before they go to school. Middle- to upper-class members of society use English when on the phone, when they e-mail, and when they chat. All these, they say, have never threatened their sense of patriotism, as patriotism – they argue – is what lies in one’s heart and soul.

With the ASEAN Economic Community starting in 2015, member-states are now busy preparing for the integration. Inasmuch as people are looking forward to enjoying the opportunities that the community-building will offer, it also brings with it challenges.

One of these is the people’s need to become competent players not only in their own countries, but also within the region. With competence closely tied to a worker’s communication skills, non-native speakers of English are faced with questions propelling them to reflect on whether they are as good or better than their counterparts in neighboring countries.

In the midst of all these, the Philippine experience may not necessarily be a perfect language learning model to the peoples of ASEAN. However, somewhere along the country's journey in making its citizens communicatively competent, perhaps some lessons can be picked up and put to good use. -

Analiza Perez-Amurao teaches research and writing courses at the Humanities and Languages Division of Mahidol University International College in Thailand. A finalist in the SEAMEO-Australia Press Award 2010, she holds a Postgrad Diploma in TESOL from RELC-Singapore and an MA in English Language and Literature Teaching from the Ateneo de Manila University. She is currently pursuing her PhD in Multicultural Studies at Mahidol University. Visit her website at Follow her tweets: @analiza_amurao.

Tuesday, 23 October 2012

Tetangco Named CB Gov For Asia

Manila Bulletin

MANILA, Philippines --- In recognition of his skillful handling of monetary policy amidst external financial threats, Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco, Jr. was named the Central Bank Governor of the Year For Asia by the international financial magazine, Emerging Markets.

“The (Philippine) central bank, under Governor Amando Tetangco’s stewardship has managed monetary policy with considerable skill, not least given the twin threats of China slowdown and spill-over from the Eurozones crisis,” Emerging Markets, in a statement, said.

Tetangco received the award at the sidelines of the World Bank-International Monetary Fund annual meeting recently held in Tokyo, Japan.

The yearly Emerging Markets CB Governor and Finance Minister of the Year Awards recognize the leading policymakers in each region. The awards are chosen by Emerging Markets’ editorial team, taking into account the views of leading regional experts.

This is the second international recognition Tetangco has received for this year to date. Early this year, the Global Finance magazine named Tetangco as one of the world’s six best central bankers in 2012. For global finance, it was Tetangco’s fourth award.

Tetangco was chosen by Global Finance in recognition of his adept handling of the economy with the country taking advantage of the “receding inflation to cut its benchmark interest rate to a record low 3.75 percent in July, to stimulate growth as the global economy weakens.”

In an interview with Emerging Markets, the BSP Chief admitted that the monetary authorities “needed to sharpen our monitoring of market behavior and be creative in implementing market-based solutions to reduce, contain or eliminate asset bubbles.”

Against the backdrop of a brewing financial crisis in the Eurozone and the narrowing of growth in China, the Philippines economic performance has remained relatively strong, registering a 6.4 percent for the first quarter of the year.

Listed Firms’ Profits Rise 26.4%

Manilla Bulletin

The combined first semester earnings of firms listed with the Philippine Stock Exchange grew by 26.4 percent to P271.02 billion from P214.40 billion in the same period last year.

The bourse said this is due to better performance of the Industrial, Financials, Holding Firms, Property, and Services Sectors.

Meanwhile, consolidated revenues of listed companies increased by 21.0 percent to P2.24 trillion from P1.85 trillion in the first half of 2011.

“We are optimistic that net income growth will be sustained for the third quarter as listed companies continue to realize profits from the positive local economic climate,” said PSE president Hans B. Sicat said.

He noted that “the improved earnings data further support investor confidence in our market, which continues to rewrite record highs in various indicators such as index levels, market capitalization, trading activity and capital raising.”

Five out of six sectors recorded positive net income growth during the first half of 2012 led by the Industrial Sector, which surged by 62.9 percent.

On a revenue basis, all the sectors registered higher revenues, with the Industrial Sector again leading the way with a 24.4 percent jump. The Industrial Sector benefited from one-time gains as well as increased equity in net earnings of associates.

Securities trading gains, on the other hand, were the drivers for the 36.6 percent net income increase in the Financials Sector.

Combined profits of the Holding Firms Sector rose 25.9 percent due to improved income contributions of subsidiaries and associates.

Consolidated income of the Property Sector climbed 9.5 percent as a result of increased real estate sales and improved rent revenues from newly opened malls.

Non-recurring gains and improved volumes contributed to an increase in the Services Sector’s combined income. However, this was tempered by higher expenses due to higher costs of sales and operating expenses.

On the other hand, the Mining & Oil Sector’s aggregate income dropped by 28.3 percent due to lower production volumes and the absence of one-time gains.

The financial doomsday solution

John Mangun
Outside the Box
Business Mirror

In the middle of 2007, the US economy started to flatten out after a strong and steady rise in the gross domestic product from 2000. Normal business cycles operate that way. At the same time, gasoline prices increased from about $2 per gallon at the start of the year to over $3 by May 2007. By May 2008, gas prices were over $4. Historically, this would have been a manageable problem. This time high gas prices helped cause a calamity.

Because the average American was over-leveraged and had taken on too much debt to buy houses, a large group of people were forced to re-allocate funds from their mortgage payments to pay for gasoline and the subsequent rise in prices throughout the economy caused by high fuel costs.

The housing market froze and this accelerated the economic slowdown as housing and related industries accounted for almost 30 percent of the US economy.

All the major banks were faced with carrying an enormous amount of non-performing housing loans. By summertime 2008, major financial
institution Lehman Brothers was in serious financial trouble due to holding billions of dollars of these now defaulting mortgages that they had originally purchased by borrowing money. It was a double debt disaster.

The US government stepped in to help the banks by creating the Trouble Asset Relief Program (TARP), which bought bad loans from the banks. At the same time, the government thought that this infusion of cash to the banks would be loaned out thus stimulating the falling economy.

When Obama took office in early 2009, he began the wildest government spending spree in history, raising the budget deficit from $400 billion to over $1 trillion. Tax revenues also declined in the falling economy and the US borrowed to pay its expenses. The Federal Reserve doubled its “money printing” from holding $800 billion of government debt to $1.7 trillion. That was Quantitative Easing 1 (QE1).

Had the bad banks, even the major ones, been allowed to go down in 2008-2009, all that TARP and QE1 money could have been used to pay back depositors, perhaps better stimulating economic activity. Instead, now three to four years later, the banks are still carrying enormous amounts of bad loans and the government has spent another $4 trillion financed in part by QE2. The economy has flat lined and we are now into QE 3.

When I wrote last week about the future negative consequences of QE3, someone tweeted me, “Sounds like a doomsday scenario. Yes, it could be possible. But I could sense sitting powers to intervene.”

Please understand this very clearly. QE3 is not the doomsday scenario; QE3 is the doomsday solution.

Western governments have two options. They can let the holders of the bad loans suffer the losses that would cause large economic shrinkage, reducing western standards of living by perhaps 30 percent or more. Alternatively they can print enough money to monetize the debt, meaning to create enough new money to pay off old debt. That is what QE is doing and will continue to do.

Almost part of our genetic code, humans anticipate tomorrow being better than today even though we know that there will always be ups and downs; rain, sun, rain in an endless cycle.

Nonetheless, since World War II, the world has experienced a constant economic growth pattern fueled in part by advances in technology and we have come to expect never-ending economic improvement. The iPhone 2 must be followed by number 3 and then 4 and beyond.

This is not new. Since the beginning of the Industrial Revolution in the mid-1700s, the average human standard of living and wealth creation has followed an upward trend. We have seen downturns due to wars and natural disasters, but particularly in the last three generations, it has been up, up, up.

If governments now allow this upward economic trend to stop by
forcing economies to shrink in order to pay off the global debt, there would be immense social upheaval and chaos. It is already happening in Greece and Spain.

To avoid a collapse of the global economy and literally global mass rioting in the streets, QE is the only solution.

Western governments have let the cancer of bad bank and government debt go too far. To let them fail at this point could potentially collapse the global financial system.

However, QE is like chemotherapy for cancer patients. Chemotherapy pumps poisons into the body, which will hopefully kill the cancer cells before the poisons kill the body. The side effects include a tremendous weakening of the immune system and a potential damaging of vital organs. I will look at more “side effects” on Thursday.

E-mail to, Web site is and Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by COL Financial Group Inc.

Monday, 22 October 2012

Philippines Airlines buys 10 more Airbus jumbo jets


Philippines Airlines (PAL) confirmed that it is buying 10 jumbo jets from Toulouse-based European aircraft-builder Airbus on Saturday, as French Prime Minister Jean-Marc Ayrault visited Manila to promote Franco-Asian trade.

The 2.5-billion-dollar (1.9-billion-euro) deal, which was announced on 28 September, was confirmed by PAL and Airbus representatives at the Manila Business Forum on Saturday.

PAL bought 54 planes from Airbus in August for 7.0 billion euros (5.4 billion euros).

The new acquisitions will replace A330 currently flying medium-haul flights for the airline.

The first 10 planes of the 64-strong order should be delivered in 2013.

Friday, 19 October 2012

Gold, oil and the US elections

John Mangun
Business Mirror

IN less than three weeks the US is going to hold its presidential elections. While the race is virtually tied according to the opinion polls, there are firm indications from another forecasting tool that Mitt Romney will be the next president.

An interesting analysis is found in the work of two University of Colorado political science professors, Kenneth Bickers and Michael Berry.

Bickers and Berry look strictly at economic conditions, including unemployment and per capita income, and where their analysis differs from most, is they break this down to the state level, not just on the national level. The model they created has accurately predicted the next president in every election going back to 1980. Interestingly, their model said that Al Gore would receive more popular votes in 2000 but that George W. Bush would capture the presidency by having the most electoral voters.

The next president needs 270 electoral votes and the prediction is that Romney will win an overwhelming victory with 330 electoral college votes versus 208 for Obama.

The biggest problem in the US economy is a lack of confidence in the Obama administration. Banks are not lending and business is not spending. While all elections, here, there and everywhere, are as much determined by voter perception of personality and character more than policy and programs, business is hoping for a change, almost any change.

In the four years of the Obama presidency, the US government debt has risen from $5 trillion to $17 trillion. Even if Romney does capture the White House, that trend will continue for at least 18 months. What must be done, and this is Romney’s election platform, is to begin to reduce the government budget deficit to help control the growth of the debt. The Philippines experienced a budget deficit reduction through both the Arroyo and Aquino administrations. That is why government borrowing has been contained and that has been good for the PHL economy.

However, quantitative easing and money printing must continue as economic growth cannot increase soon enough or fast enough to reduce the government debt even under Romney.

I have said before that we can track the course and amount of Federal Reserve money printing by monitoring the price of gold. And I still stand by my “$3,000 gold in two years” prediction even as I predict a Romney victory, though my confidence in the gold prediction is much greater than the election forecast.

However, the blame for the current US debt crisis cannot specifically be laid at Obama’s feet or any other president’s as this has been a slow, creeping process since the mid-1980s that puts many global leaders and many global institutions at terrible fault.

Regardless of who is the next president of the US, the greatest problem facing the world and particularly countries like the Philippines is found in the gold/oil ratio (GOR). The GOR measures how many barrels of crude oil can be bought with one ounce of gold. Since 1946, the GOR has averaged 15 or 15 barrels of crude oil per ounce of gold. As of now the GOR is about 20, which means that oil is historically cheap or gold is expensive.

If gold reaches $3,000 because of a devaluing dollar, using a 15 GOR, oil would be $200 per barrel without any other negative changes in current geo-political/economic conditions. Gasoline in the PHL would cost P100 per liter. To pay the same price as today with oil at $200, the peso would have to appreciate to P22. So which is better; P100 gasoline or a 22 to one dollar peso? “Would you prefer the pistol or the poison, Mr. Bond?”

The world will not tolerate this happening as the US tries to save its economy.

If there is to be a sacrificial lamb, it will be the US as countries move off from paying for oil and other commodities with dollars. It is already happening. We will see a time when oil will be paid for in gold or exported goods valued against the price of gold.

That is why countries with smart leaders like Russia, Thailand and Mexico are continuously converting dollars and major currencies to gold. Other countries like Mongolia, Indonesia and Chile are developing their mineral resources as fast as possible.

The foolish nations are leaving their gold in ground and instead accumulating billions in paper currency as their rainy day reserves. It is truly frightening and astounding that government leaders learned nothing from the 1997 crisis and that situations can change literally overnight.

On Friday, June 6, 1997, the peso closed at 26. On Monday, June 9, the peso opened at 36.

E-mail to, web site is, and Twitter @mangunonmarkets. PSE stock market information and technical analysis tools provided by COL Financial Group Inc.

PH economy seen to remain most promising in SEA

Ronnel W. Domingo
Philippine Daily Inquirer

The Philippines is expected to remain the most promising economy in Southeast Asia as the country performs better than the regional average, according to UBS Securities.
The financial services firm said in a new report that the Association of Southeast Asian Nations appeared to operate in a “different dynamic” as efforts to build a single economy progressed.

However, UBS noted that the Asean remained economically diverse—both in terms of size and level of development—even as it represented a population of some 600 million and a gross domestic product that was three-fifths that of Germany.

“Of the larger economies, we think the Philippines will continue to prove to be the most surprisingly impressive,” UBS said, citing analysis from economist Edward Teather.

Mark Mobius: Philippines 'has got tremendous potential'
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Wednesday, 17 October 2012

Philippines--an overlooked emerging market

Three Overlooked Emerging Market ETFs
By: Eric Dutram
Zacks Investment Research

For investors looking for a smaller economy that has been overlooked, the island nation of the Philippines could be worth a closer look. The country has a $350 billion economy which means that it is larger than Switzerland, Hong Kong, or Singapore. Yet despite this size, the country makes up under 75 basis points in VWO, practically a rounding error in total portfolio contribution.

Sunday, 14 October 2012

Healthcare workers can earn more than P300,000 in BPOs

By: Likha Cuevas-Miel,
The online news portal of TV5

MANILA - More Filipino nurses and doctors can earn six-digit salaries without having to go abroad, according to a US-based business process outsourcing company in the health field.

"The access to this pool of talent is a plus for our clients. The skill sets of the Philippines is better than those in other markets," Rohit Kapoor, ExlService Holdings Inc. vice chairman and chief executive, said in a briefing on Tuesday.

Jaideep Pradhan, EXL senior vice president for operations and Philippine business head, said a company must offer handsome compensation packages to healthcare workers to make them stay in the country and slow down the brain drain.

Filipino nurses - who otherwise have to pay for their hospital training - can earn P18,000-35,000 a month in the country, while BPO companies like EXL foot the bill of their hospital training. The Nasdaq-listed healthcare BPO firm has a tie up with Manila Doctors Hospital for this purpose.

Depending on their clinical experience, doctors receive salaries of P100,000 to P300,000 in EXL and still get to practice outside their BPO work.

Aside from the normal BPO perks to workers, the company has to pay for the fees of those who need to take the National Council Licensure Examination, Pradhan said. Nurses are required to take the NCLEX so they can work in the US.

Pradhan said the company has to offer these perks - aside from the normal benefits other BPO workers receive - to corner enough skilled and licensed workers that their clients look for.

The New York-headquartered company has around 1,800 workers and close to 800 of these are nurses and doctors who hold US licenses.

"Our compensation is the thing that make us stay. Our compensation is at par with the salaries our counterparts receive abroad," Loraine Lopez, a nurse associate at EXL told participants of the 4th International Outsourcing Summit.

Lopez was a medical technologist who studied nursing so she can work in the US. While waiting for her work permit approval, she opted to work as volunteer nurse or nursing associate in various hospitals and clinics to get the training and specialization that would make her more marketable abroad.

There were times she would only get P3,500 a month - the same salary her family househelp gets - with free meals or none at all. She is a trained hemodialysis nurse.

After years of training or working for a pittance, Lopez' permit was denied after the US government tightened the entry of foreign nurses.

She said working in the healthcare BPO industry is a better option for those who want to earn well and have families in the Philippines.

According to Kapoor, EXL is putting up a healthcare academy to hone the clinical skills of the company's workers.

"Not all the talent is available in the market that is why we are making this investment," he said.

"It is always a risk that our trained workers may leave for work abroad but that is the risk we have to take," Kapoor said.

To make workers stay, EXL is offering a "very credible career path" so that if they want to graduate from being a nurse or a doctor dispensing medical advice through telephone, there are other doors opened to them like in insurance and other allied industries.

The company has also tied up with the Asian Institute of Management to groom middle managers.

EXL is opening a new 500-seat site in Cebu City and adding 500 seats to its existing site at the Mall of Asia in Pasay City.

By the end of next year, EXL will open a new site in Metro Manila.

Philippines has reached 'inflection point,' says HK Genting exec

By: Krista Angela M. Montealegre,
The online news portal of TV5

MANILA - The Genting Group of Hong Kong will hike its investments in the Philippines, which the company said has reached its "inflection point” amid government reforms, favorable macroeconomic fundamentals and a skilled labor force.

Speaking at the 38th Philippine Business Conference and Expo on Wednesday, David Chua, president of Genting Hong Kong, said he is "totally convinced" that "the Philippines is the right place, the Filipinos are the right people and now is the right time" to invest here.

The Genting Group, along with Alliance Global Group Inc., will pour another $1.2 billion in the next three years with the launch of Resorts World Bayshore in state-run Pagocor's Entertainment City project, Chua said.

AGI and the Genting Group have jointly invested $800 million in Resorts World Manila, the country's first integrated tourism entertainment complex, through Travellers International Hotel Group Inc.

Chua said it took him more than 10 years to return to the Philippines since his last visit in the 1990s. The Genting Group finally decided to invest here in 2008.

"It is because of it being the right time, the right place and the right people, that many believe the Philippines is hitting an inflection point, much like Indonesia did recently. I would like to say that from having invested more than four years ago, I believe that the Philippines has already hit that inflection point," Chua said.

Now is the "right time" to invest in the Philippines, Chua said, adding that government and policy reforms in eradicating inefficiencies and rampant corruption "usually sets the scene for the next stage of growth and development."

The Philippines has become an attractive investment destination because of its favorable macroeconomic fundamentals characterized by low inflation, improved credit rating, strong currency and an emerging middle-class.

Chua also noted the "young highly educated and extremely talented" workforce bodes well for the country.

"The Philippines is uniquely positioned as it traditionally [has] been an exporter of human capital especially knowledge workers. Unlike other countries such as Singapore and Hong Kong who have had to import skilled workers, the Philippines hitting her inflection point need only bring back home the OFWs," Chua said.

Monday, 8 October 2012

Companies raise record P175b from PH market

By Jenniffer B. Austria
Manila Standard

The total capital raised from the Philippine stock market reached a record P174.9 billion in the first nine months of the year, up 171 percent from P64.5 billion year-on-year, due to an increase in the number of companies raising money through the bourse.

Data from the PSE showed total capital raised from January to September this year also beat the full-year 2011 record figure of P107.50 billion.

Friday, 5 October 2012

BPO industry up 24% y-o-y

Manila Times

IT is considered as the lifesaver of the Philippine economy, bringing in billions of dollars in investment and revenue, and also helping create thousands of jobs for newly graduating Filipinos.

And now more good tidings come on the back of news that the rapid expansion of the Information Technology and business process outsourcing industry (IT-BPO) in the Philippines has surpassed even the most optimistic forecasts, because of the exemplary public-private partnership (PPP) this key sector demonstrated.

The Business Processing Association of the Philippines (BPAP) in its most recent report released data about the local IT-BPO sector’s outstanding performance in 2011—and its makes impressive reading indeed.

With a total of $11 billion in revenue (an increase of 24 percent on the previous year) and 638,000 call center employees (an increase of 22 percent than in 2010), the industry is far surpassing its projected 20-percent annual growth rate.

At these rates, according to the BPAP, the IT-BPO industry in the Philippines will bring in a staggering $25 billion a year by 2016, making up 9 percent of the Philippine’s GDP, 10 percent of the sector’s global market share and employing 1.3 million Filipinos.

Adding his own praise to the phenomenal and highly visible progress made in the BPO industry, Sen. Edgardo Angara, vice chair of the Senate Finance Committee commented, “In such a short time, the IT-BPO industry has become one of the biggest job-creators in the country. In the past decade, the sector has grown exponentially in terms of workforce and income generation, from a fledgling subsector of the service industry to a multibillion dollar earner.”

The next step, according to Angara, is to ensure the continued progress of the industry through combined efforts from the government and private sector.

“The success of this industry in our country is a perfect example of how the private sector and the concerned government agencies can work together and share their resources towards a common goal. Because of this united effort, the Philippines is now a close second to India as the world’s largest BPO provider,” said the veteran lawmaker.

Just this year alone, several grants and subsidies have been given by the different agencies and institutions, all earmarked for educational and technical development of the BPO sector.

Among them is a grant of $650,000 (P27.3 million) given by the Asian Development Bank in technical assistance for educational programs for skills enhancement in the BPO sector.

Furthermore, a P450-million subsidy has been given by the Technical Education and Skills Development Authority for training, while the Information and Communication Technology Office under the Department of Science and Technology has allocated P350 million to support the IT-BPO industry.

State universities around the country have also been granted a combined budget of P125 million to fund their various IT-PBO based programs.

“We must maintain our country’s foothold in this booming global industry,” said Angara, a former president of the University of the Philippines.

He added, “IT-BPO might very well be the spark that sets off the Philippines’ economic boom.”

Philippines 2015 Exciting Projects

Mishafoundation Youtube

New processes to take effect next year at BIR

Diane Claire J. Jiao BusinessWorld THE FIRST STAGE of a planned modernization of key tax processes will be implemented by mid-2013, the chief of the Bureau of Internal Revenue (BIR) said, with a full rollout scheduled for the following year. “Phase 1 of the process reengineering is slated for July 2013, while Phase 2 is in 2014. This will simplify and computerize the main transactions with the bureau,” BIR Commissioner Kim S. Jacinto-Henares yesterday said at a forum organized by the Financial Executives Institute of the Philippines. “Once the processes are electronic, they will be standardized across the country. Taxpayers will have to follow the same requirements and procedures whether they apply in Metro Manila or in the provinces,” she added. All businesses will be able to apply for their certificates of registration electronically by next year. Data will be encoded by taxpayers online and the document will be delivered to them once the BIR gives its approval. The courier will take pictures of the firm’s office to ensure that it is a real entity. Coordinates will also be plotted for future tax-mapping operations. “This will target the modus operandi of creating dummy companies,” Ms. Henares said. Another reform involves accrediting printers of invoices -- which will have an expiration date tentatively pegged at five years. Also, the BIR will computerize the issuance of documents such as the Certificate Authorizing Registration, a prerequisite to the transfer or sale of land, buildings or shares of stock. It indicates that a taxpayer has paid the necessary donor’s or capital gains tax. The Authority to Release Imported Goods will likewise be processed electronically, with the BIR transmitting the document directly to the Bureau of Customs to prevent falsification. These reforms add to plans earlier detailed by Ms. Henares to move tax identification number applications online. The end-goal, she said, is for every taxpayer to have an electronic tax folder containing all relevant documents such as certificates, returns, payments and communications with the bureau.

Pride goes before destruction

Business Mirror

THERE is nothing wrong with being proud of your accomplishments although the Catholic Church considers “pride” as a serious transgression. Perhaps a more appropriate word would be “hubris.” Hubris is defined as extreme pride or self-confidence. The original Greek word used by playwrights of Greek tragedies was used to describe excessive pride toward or defying the gods leading to a nemesis, a being or situation that cannot be overcome and leads to one’s downfall.
Greek gods did not look kindly on mere mortals who had an arrogant attitude. In common usage, hubris was used to describe someone who in victory unnecessarily shamed or humiliated his opponent and thereby brought shame and ruin on himself.

Countries fall victim to the sin of hubris also. In 1989 an essay was published, later becoming a book, entitled The Japan that can say no, authored by then-Japanese Minister of Transportation Shintaro Ishihara, and Sony Corp. founder Akio Morita. The essay portrayed Japan as a country that had come out from under US dominance and, as a superior nation, would soon eclipse US economic power. Coincidentally, that was probably the peak of Japan being an economic powerhouse. A newer version would probably be called, “The Japan that cannot grow.”

A decade later, China began its phenomenal economic expansion assuming that it could do no wrong and could steamroll the Western economies, particularly the US. While that may be true to a certain extent, in 2012 China is faced with the fact that over 50,000 factories exporting goods to the West have closed in the Guangdong region. China is proud of the fact that it is sitting on a couple of trillion dollars of US debt and $3.2 trillion in international reserves. Yet while selling that debt and those dollars might cause harm to the US and global economy, the financial loss to China would bring a special meaning to “shooting yourself in the foot.”

The Western countries invented the word hubris and raised overconfidence to a new level, not unlike a wealthy taipan at the casino who winds up with nothing left and deeply in debt.

Is the Philippines reaching beyond pride of accomplishment to the dangerous area of hubris?

Chief economist for Asia Pacific at Citi Johanna Chua has some interesting thoughts on the growth of Philippine international reserves now at over $80 billion, the largest in the region following China. The international reserves that a country holds are an important tool to protect the currency and economy from instability as well as to fund import purchases. It is like money in the bank for a rainy day. The government has paraded PHL reserves as an indication of good economic policy. However, the reality is that, to use Ms. Chua’s term, excessive reserves are not necessarily healthy. Those dollars the government is holding were purchased by selling pesos. Those pesos inflate the domestic money supply. To “sterilize” the potential inflation problems of these additional pesos, the Bangko Sentral forces banks to deposit more pesos with the BSP on which the BSP pays interest. Sure, strong reserves are important, but balance and moderation are equally important.

Another problem with hubris is that judgment and priorities can become clouded. The cybercrime law is an important piece of legislation. It should have simply addressed economic concerns with the strengthening of PHL data security laws. But well enough could not be left alone and provisions unrelated to data-security were included and now a major controversy has exploded, further confusing and bringing uncertainty and inconsistency to Philippine lawmaking.

The government has not addressed the fiscal matters regarding the very important mining industry. The government has not addressed a rationalization of investment incentives and taxation. The government has not addressed any significant measures to bring more foreign investment into this country.

Overexcited pride almost always leads to an exaggerated sense of accomplishment. Minor improvements are seen as monumental advances forward; and inflated opinion of one’s successes. Every time a global bank or broker raises economic growth expectations, you can see the government basking in the glory like a tourist lying on a sunny beach in Boracay. The fact is that PHL economic growth is barely keeping the country’s collective head above water and not drowning. Five- percent economic growth will make major inroads into poverty reduction in about 30 years.

The country is not moving forward fast enough to warrant any thoughts of great accomplishments being made. To feel that way is nothing more than hubris. And we know exactly what happens when there is too much pride.

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