business

Bangko Sentral exec cites needs to further enhance capital market

September 28, 2019

THE need to introduce further improvements to the Philippines’ capital market has risen especially in recent years to help address the dovish interest rate outlook and slower global growth, among others.      Reliance on banks as major fund source for corporates should be lessened. Instead, businesses should have greater access to the capital market.      Bangko Sentral ng Pilipinas (BSP) Assistant Governor Johnny Noe Ravalo, in a briefing on the release of the Financial Stability Report for the first half of 2018 until 2019 at the central bank Wednesday, said members of the Financial Stability Coordination Council (FSCC) has recommended three interventions to ensure financial stability in the domestic economy.      These measures are namely fewer but deeper benchmark tenors, indexed bonds, and tenor-based pricing.      Revelo said these proposed interventions are very timely because interest rates are falling and so it financing.      In an interview by journalists, he explained that reducing dependence on banks for funding cannot be done overnight since an economy needs an efficient capital market first to really change the market landscape.      He pointed out that an efficient capital market reflects fair prices of risks and fair price of risks for a particular tenor, which investors can compare.      “So by giving out fair prices, tenor-based, you’re allowing people choices. Do I borrow one-time seven years or do I borrow five years and then borrow two years after the fifth year? Those are the decisions that have to be made,” he said.      To date, some listed companies are now issuing their bond debt papers, thus, Ravelo said the change will not start from zero because there is already a market for these instruments.      “What we’d like to do going forward is polish whatever we have right now so that a lot more of the SMEs (small and medium enterprise) can go to the capital market instead of just going to the banking industry,” he said.      The BSP executive explained that while there is nothing wrong from borrowing from banks, these financial institutions also get part of their funds from deposits, which account holders can withdraw anytime they want.      This, he pointed out, “comes in a market friction cost and market development cost.”      “Whereas compared to the capital market when an issuer says I’m raising 10-year money those who buy the 10-year bond are saying we have 10-year money. So the tenor mismatch is removed,” he said.      “From that alone that’s going to be a massive improvement already. So it’s the next step but just to be absolutely clear we’re not starting from zero,” he said. “That’s also why we are growing by six percent because we have a financial market that allows for the economic activities to be financed,” he added. (PNA)

READ MORE
ADB cuts 2019, 2020 growth forecasts for PH

September 27, 2019

THE Asian Development Bank (ADB) has slightly reduced its economic growth forecast for the Philippines for the next two years amid a slowdown in the global economy and domestic investment, even as the country remains one of Asia’s best performers.      In an update of its flagship annual economic publication, Asian Development Outlook (ADO) 2019, the Manila-based multilateral bank revised its forecast for Philippine gross domestic product (GDP) growth to 6 percent in 2019 and 6.2 percent in 2020, against its previous forecast of 6.4 percent for both years.      In a press conference on Wednesday, ADB Country Director for the Philippines Kelly Bird attributed the downward revision to slowdown in global economy and in domestic investment in first half of the year caused mainly by the 2019 budget impasse.      “Public spending should regain traction for the rest of 2019, with the government committed to catching up with its spending plans, especially as new and larger infrastructure projects get underway,” he said.      Bird sees the recovery in public spending also boosting private consumption, which is currently well supported by steady overseas workers’ remittances, moderate inflation, and low unemployment.      The ADB said public expenditure next year is expected to provide a further boost to the economy amid the proposed 12-percent increase in the 2020 national budget, with higher spending particularly on infrastructure, social services, and income transfers to poor households.      “Public and private investment should regain traction as new and larger infrastructure projects get under way,” it added.      The multilateral bank said the outlook for exports remains weak in light of the slower-than-expected economic growth in major industrialized economies, which are among the Philippines’ largest export markets.      The country’s GDP growth rate averaged 5.5 percent in the first semester.      “Philippine economic growth is resilient despite weak external environment,” Bird said, noting that strong macroeconomic policy settings help build resilience.      The ADB further expects inflation to slow to 2.6 percent in 2019 and 3 percent in 2020, significantly lower than previous ADB forecasts, largely on improved domestic rice supplies following the lifting of quantitative rice import restrictions in February this year.      “That drop in inflation was due to better supplies of rice in the domestic market as a result of rice reforms and quantitative restrictions, but also as the monetary tightening last year starts to lower inflation expectations,” Bird said.      In the long term, Bird cited proactive policy reforms that are laying the foundation for higher growth, including the Tax Reform for Acceleration and Inclusion (TRAIN), Ease of Doing Business Act, and rice reforms, among others.      “Further relaxing restrictions on foreign investment and creating a national competition policy can also promote long term growth and more quality jobs,” he added. (PNA)

READ MORE
ITALPINAS CEO, ARCH. ROMOLO NATI SPEAKS AT THE REAL ESTATE EXPO MANILA 2019

September 18, 2019

MANILA- Italpinas Development Corporation Chairman and CEO Architect Romolo V. Nati spoke at the Real Estate Expo Manila 2019, an international event and influential platform escalating business networking with the top executives. The year’s theme, “Strengthening the Foundation through Innovation in the Real Estate Industry”.      REEM 2019 is an international sought-after event where the regional and international investors, developers, investment promotion authorities and real estate professionals converge to discuss growth drivers in the real estate investment and development on emerging markets globally. Arch. Nati, a devout advocate of sustainability, talked about  “Green Buildings in Emerging Cities in the Philippines”, sharing the strategies and architectural technologies which are among the means of the successful accomplishments of Italpinas Development Corporation, a “design-driven developer of sustainable properties focused on emerging cities in the Philippines”.      As an expert in green architecture, he emphasized the advantages of promoting sustainable buildings in secondary and tertiary cities explaining that aside from reducing overall impact to the environment and to human health. “Green buildings are the key for property developers to achieve sustainable urban development in an environmentally friendly manner. Such structures are defined as environmentally responsible and resource-efficient over their full life cycles and proven to be cost effective with reduced energy requirements,” expressed Nati.      Italpinas Development Corporation was officially listed in the Philippine Stock Exchange (PSE) on December 7 2015, only six years after its establishment. As a multi-awarded green developer, IDC’s breakthrough project, the mixed-use two tower building, Primavera Residences in uptown Cagayan de Oro, has gained international and national accolades. These include the Best-Development Mixed-use Development in the Philippines, awarded by the International Property Awards-Asia Pacific and the First Completed Building in East Asia to be certified by EDGE (Excellence in Design for Greater Efficiency).        This honor was given by the prestigious IFC World Bank Group, the innovator of EDGE software and certification program which was launched a few years back and currently used mostly by building designers and property developers who want their buildings to withstand various climate stresses for a long period of time and command greater value in the market.      Current IDC’s green projects, Primavera City, in uptown Cagayan de Oro, and the latest high-rise eco-friendly Miramonti Green Residences in Sto. Tomas, Batangas, have been awarded as Best-Development Mixed-use Development in the Philippines, by the International Property Awards-Asia Pacific, a highly acclaimed award in the worldwide property industry. Among the numerous attendees that participate at the event, a large group of Real Estate Management’s students from Emilio Aguinaldo College (Cavite) led by Professor Engineer Erna Ladia who actively interacted with Arch. Nati in the Q and A session, following his presentation.

READ MORE
Holcim to help UN Habitat, TESDA in Marawi rebuild project

September 16, 2019

Leading cement maker Holcim Philippines, Inc. will support a project by the United Nations Human Settlement Program (UN Habitat) and the Technical Education and Skills Development Authority (TESDA) to build new homes for 1,500 families displaced by the conflict in Marawi.       Holcim Vice President for Communications Cara Ramirez shared during the 7th Annual Asia-Pacific Housing Forum organized by Habitat for HumanityPhilippines on July 31 that the company is set to fund masonry training for 300 beneficiaries.      UN Habitat will be responsible for recruiting the beneficiaries from among the residents of identified resettlement sites and coordinating logistics for the project. The TESDA, through its Regional Training Center inIliganCity, will administer the masonry course and certify as skilled workers those who pass.      Ramirez said the partnership with UN Habitat and TESDA is in line with the company’s corporate citizenship campaign, Holcim Helps, which tailors capacity-building support based on the needs of beneficiaries so programs are more sustainable and have a lasting positive impact.      “Holcim Helps focuses our efforts on education, livelihood, and infrastructure programs, which are designed in collaboration with our communities so we can identify the programs that are relevant to them and answers their needs,” she added.       Ramirez shared that Holcim Philippines had extended similar support to communities displaced by a natural calamity such as survivors of Typhoon Pablo in Compostella Valley in 2012 or vulnerable to one as the case of people living near the company’s Davao plant.       The support for masonry trainings were implemented through Holcim’s flagship Galing Mason program, which equips beneficiaries with skills that allow them to contribute to the rebuilding of their homes and provides them options for livelihood.       Ramirez shared these as part of her talk on the company’s efforts to contribute to addressing the deficit of quality shelters in the country.       She noted aside from providing quality cement to ensure the durability and quality of shelters being built, Holcim Philippines has also developed new products for specific applications that contribute to improving quality and reducing cost of construction.      “For example, local developers have grown to embrace masonry cement, which is better for finishing applications and more affordable than general purpose cement. While cement only accounts for roughly 10% of building costs, the savings from using the right cement can still help developers manage costs while also delivering quality shelters for their customers,” she said.      A biennial conference organized by Habitat for Humanity Philippines, the Asia-Pacific Housing Forumgathers both public and private stakeholders engaged in finding solutions for inadequate shelter issues and promoting affordable housing as a driver of economic growth. For this year’s forum, the newly formed Department of Human Settlements and Urban Development wasthe content partner.

READ MORE
Toyota and Suzuki Enter into Capital Alliance Agreement

September 9, 2019

Toyota Motor Corporation and Suzuki Motor Corporation announced that the two companies entered into an agreement regarding a capital alliance (the “Alliance”) today, in order to establish and promote a long-term partnership between the two companies for promoting collaboration in new fields, including the field of autonomous driving.      The two companies began considering business partnership on October 12, 2016, and since then have continued to consider specific details. On March 20 of this year, the companies announced that they would begin specific considerations in order to engage in joint product development and collaboration in production, in addition to promoting the mutual supply of products, by bringing together Toyota’s strength in electrification technologies and Suzuki’s strength in technologies for compact vehicles.       Separately, the automobile sector is currently experiencing a turning point unprecedented in both scope and scale, not only because of enhanced environmental regulations, but also from new entries from distinct industries and diversified mobility businesses. The two companies intend to achieve sustainable growth, by overcoming new challenges surrounding the automobile sector by building and deepening cooperative relationships in new fields while continuing to be competitors, in addition to strengthening the technologies and products in which each company specializes and their existing business foundations.       Specifically, to take up challenges together in this transitional era, the two companies plan to establish and promote a long-term partnership between the two companies for promoting collaboration in new fields, including the field of autonomous driving.       The execution of the capital alliance agreement is a confirmation and expression of the outcome of sincere and careful discussions between the two companies, and it will serve for building and promoting their future partnership in new fields.      In order to develop and promote a long-term partnership between the two companies, the companies plan to acquire each other’s shares based on the Alliance.       Toyota plans to acquire 24,000,000 shares of common stock in Suzuki (4.94% ownership of the total number of shares issued by Suzuki as of March 31, 2019 (excluding treasury shares) with a total value of JPY 96 billion) by underwriting the disposition of treasury shares by way of third-party allotment conducted by Suzuki.       Likewise, Suzuki plans to acquire, through purchase in the market, shares in Toyota equivalent to JPY 48 billion. These share acquisitions will be implemented after the companies obtain approvals from the foreign competition authorities.      Source: www.globalsuzuki.com

READ MORE
Toyota Safety Sense: Humans and Machines Working Together for Safer Driving

September 9, 2019

According to the World Health Organization Global Status Report, road accident statistics in the Philippines has constantly increased since 2016. A number of accidents have resulted in injuries or deaths, some of which could have been avoided if motorists are taking extra safety measures.      For leading mobility company Toyota, safety features are just as essential to the car as any other advanced functional technologies. That is why it the company is set to actively rollout its proprietary Toyota Safety Sense (TSS).      In addition to the passive safety features which we are already familiar with such as the vehicle’s impact absorbing structure, seatbelts, and number of airbags, TSS incorporates active safety features which identify factors that may cause accidents and aid the driver in eliminating these factors      Some of the features available under TSS are Pre-collision System (PCS), Adaptive Cruise Control (ACC), Lane Departure Alert (LDA), and Automatic High Beam (AHB).      Pre-collision System (PCS) – detects the possibility of a collision using various sensors and reacts accordingly, also taking into consideration the countermeasures taken by the driver. Upon detection of a possibility of collision, the driver will be warned with beeps and visual warnings. When the possibility of a collision is higher and the driver applies brakes, the brake assist system will apply additional pressure to the brakes as needed. When an even greater possibility of collision is detected and the driver did not apply brakes, automatic brakes will be activated to prevent the collision.      Adaptive Cruise Control (ACC) – when driving at cruise control, the vehicle drives at constant preset speed and will adjust within the set cruise speed upon detection of another vehicle in front to maintain appropriate distance.      Lane Departure Alert (LDA) – detects driving lanes and alerts driver when the vehicle departs from its designated lane. This feature operates at a vehicle speed of more than 50km/h, with a road width of more than approximately 3.0m.      Automatic High Beam (AHB) – while the headlight’s high beam setting is in use, the system automatically switches to low beam upon detection of vehicles at a certain distance in front or incoming vehicles on the opposite lane. The system will return to the high beam setting once the vehicle in front is at an appropriate distance or the incoming vehicle has passed.      These features fall under certain classes, with classes and feature variations available in selected new models and variants globally. With safety as Toyota Motor Philippines’ number one priority, select TSS features is available with the all-new Hiace Super Grandia Elite. More models will soon carry TSS’ active safety features that can give Filipino motorists and their families peace of mind, further supporting ever better lives through ever better cars.

READ MORE


Subscribe Now!

Receive email updates from Business Week.