Philippine Weekly Update

18 - 24 June, 2016

June 28, 2016 Philippine Weekly Update

POLITICS

Speaker Feliciano Belmonte Jr. lauded the 10-point economic agenda of President-elect Rodrigo Duterte.  Duterte’s economic agenda prioritizes the budgetary need for inclusive growth in the economy. The 10-point economic agenda was laid out before 300 business leaders in Davao City last June 20 to 21 at a consultative workshop called "Sulong Pilipinas: Hakbang Tungo sa Kaunlaran."


BUSINESS

Philippine Long Distance Telephone Co. (PLDT) and Globe Telecom Inc. have appealed for a dialogue with the Philippine Competition Commission (PCC) to resolve the impasse on their joint buyout of San Miguel Corp.’s telecom assets even as they warned that the situation has created an atmosphere of uncertainty among investors. 


ECONOMY

The Philippine economy can easily grow close to 7% this year despite the change in government and the uncertainty this brings, with domestic drivers seen intact and reforms expected to be introduced by President-elect Rodrigo R. Duterte adding more fuel for further expansion.

Preliminary data from the PSA showed that the Philippines bought a total of $6.529 billion worth of goods from abroad last April, up by 29.2% from the revised $5.053 billion a year earlier. The April growth was a reversal from last year’s 5.8% contraction and faster than the 11.7% growth seen in March.

Last April’s gain was the fastest since the 35.6% increase logged in November 2010. The latest imports reading brought the balance of trade in goods to a deficit of $2.275 billion, higher than last year’s $618.95 million. The government expects imports to grow by 7% this year on account of the decline in energy and metal prices.


INVESTMENTS

The Board of Investments (BOI) is proposing the development of an ecological industrial zone in Leyte as part of the economic rehabilitation of the Typhoon Yolanda-stricken city. Conservation and protection of the environment is the major focus of the project, hence the concept of an ecological industrial zone instead of a regular industrial zone.  The proposed ecological industrial zone itself provides services for waste management and recycling. 

The Philippines needs to invest between $20 billion and $30 billion to build power plants capable of meeting demand by 2030, but must be prepared to shoulder the cost if it wants supply to come from renewable energy, according to Manuel V. Pangilinan, chairman of Manila Electric Co. (Meralco). 

The Philippines is now among the top 15 preferred investment destinations of multinational enterprises in the next three years, according to the latest World Investment Report 2016 of the United Nations Conference on Trade and Development (UNCTAD).


INFRASTRUCTURE

The Philippine government plans to boost infrastructure spending next year to the equivalent of 6% of gross domestic product, from this year’s target of 5% of GDP, according to Benjamin Diokno, appointed budget secretary by President-elect Rodrigo Duterte. 

Five public-private partnership (PPP) projects lined up for approval by the National Economic and Development Authority (NEDA) board since last year would be turned over to the next economic administration for review and clearance. The projects collectively valued at more than P100 billion which includes the Ninoy Aquino International Airport (NAIA) Development project, Batangas-Manila Natural Gas Pipeline Project, Plaridel Bypass Toll Road,  Philippine Travel Center Complex, and New Nayong Pilipino at Entertainment City Project. 


ENERGY

The Department of Energy (DOE) issued the draft rules for the much awaited Renewable Portfolio Standards (RPS), which mandates power industry players to produce and source a certain percentage of electricity from renewable energy (RE) sources. The DOE published the draft circular posted on its website, which will cover all distribution utilities (DUs), licensed retail electricity suppliers (RES), local RES, suppliers of last resort (SOLR), generating companies and authorized distributors in economic zones. 

Seventeen solar power projects were endorsed to receive incentives in the second round for solar under the feed-in tariff (FIT) scheme. DOE assures the best interest of the public and all renewable energy (RE) developers particularly in meeting the country’s commitment towards sustainable and cleaner energy, according to DOE Secretary Zenaida Monsada.

The Department of Energy (DOE) is undertaking two studies on the implementation of a new roadmap for biodiesel to balance its benefits to coconut farmers and impact to consumers. One is being done by a University of the Philippines-Los Banos (UPLB) and the other by UP School of Economics.  The two studies aim to determine if the farmers will benefit according to the objectives of the Biofuels Law while not burdening the general public. 


AGRICULTURE

Leaders of fisherfolk and marine conservation groups urged President-elect Rodrigo R. Duterte to improve the lot of fishing communities by putting an end to crimes happening at sea and in coastal communities in his first six months in office.

The Department of Agriculture (DA) is investing P131 million to intensify hybrid rice expansion in Mindanao in efforts to increase farmers’ income. The DA is in partnership with hybrid rice and seeds producer SL Agritech Corp. to increase food production programs in Mindanao and it also targets to expand hybrid rice area to 600,000 to 700,000 hectares next year and as much as one million hectares by 2020 from the current 400,000 hectares.