PHL preps host of trade deals as part of export-leader vision

negotiations between Manila and New Delhi.

Investment in BARMM hits ₧3.1B in Q3

By Manuel T. Cayon @awimailbox

DAVAO CITY—The Bangsamoro Board of Investments (BBOI) has already approved a total of P 3.1-billion worth of investments way into the middle of the third quarter.

By Cai U. Ordinario @caiordinario

THE Philippines is preparing a host of trade deals with three Asian countries in its bid to become an export powerhouse by 2028, according to the Department of Trade and Industry (DTI).

Trade and Industry Undersecretary

Ceferino S. Rodolfo recently told reporters that negotiations to craft a free trade agreement (FTA) with the United Arab Emirates (UAE) and the scoping for a Preferential Trade Agreement (PTA) with India this year while the country’s FTA with South Korea could already be signed within two months.

Rodolfo said the country’s interests in an FTA with the UAE are focused on halalrelated products, food manufacturing and finished consumer goods while India could be another destination for Philippine bananas, pineapples and mangoes.

“Mainly, consumer and consumer durables, particularly those of more differentiated, premium products, garments, Timex watches, belt, leather products, food, [then] halal na food, [and] tropical fruits,” Rodolfo said. We don’t have “sensitivity with respect to UAE. They are really more of a market,” he added. “In terms of renewable energy (RE), (they could be) more of an investor to our RE projects.”

Rodolfo said, however, that the FTA with the UAE may not include all labor concerns such as access given that the country could maximize these kinds of opportunities through bilateral labor agreements that are under the purview of the Department of Labor and Employment (DOLE).

“Yung dinidiscuss natin dito sa mga FTAs, mostly movement of natural persons, including those that are in fulfillment of contracts. May company dito na nakakuha ng kontrata, magiinstall ng computers, sa isang hotel sa UAE, yungpagdalangPilipinodoon.Hindi yung isang Pilipino na maghahanap ng trabaho doon. Kasi mas maraming issue doonsokailangannayung bilateral labor agreement yung protection. Dun yun dini-discuss,” Rodolfo explained.

[What we are discussing here in FTAs are mostly movement of natural persons, including those that are in fulfillment of contracts. There is a company here that got a contract to install computers in a hotel in the UAE; to bring Filipinos there. This would not be for only one Filipino looking for a job there because there are more issues there, so the bilateral labor agreement is needed for protection. That is what is being discussed.]

Meanwhile, Rodolfo said the Terms of Reference for the PTA with India could be issued this year and, hence, starts the PTA

The trade official added that in a recent event in Cebu, the Indian Ambassador recognized the need to create a PTA with the Philippines. He said the discussions, unfortunately, were stalled because of the pandemic.

This means the country only needed to reconnect with India, according to Rodolfo. The focus of these PTAs will be in both agricultural and industrial goods.

The PTA with India could also help the Philippines get access to certain products amid bans such as the recent decision of New Delhi to impose a rice export ban.

“[We want to] ensure that we have access to critical Indian products,” Rodolfo said adding there would be no imposition of export restrictions.

He explained that prior to India’s rice export ban, New Delhi restricted the export of active pharmaceutical ingredients (APIs) during the pandemic.

“Tapos nakausap natin sila kaya nakakuha parin tayo.” [Then we talked to them so we still got the APIs.]

Meanwhile, Rodolfo said South Korea has sent a letter to the government that Seoul is ready to sign the agreement since they were already able to complete their domestic processes.

The trade official said Manila is already in the process of completing the certificates of concurrence in order to get a “signing authority” for the agreement.

This reflects the new process adopted by the Office of the President (OP) that the agreement should receive a Certificate of Compliance (COC) before the signing authority is issued.

“Nabago ngayon eh. Dati, signing authority tapos pipirmahan ni Secretary tapos ibabalik kay Presidente at ir-ratify na niya tsaka kukuha ng certificate of concurrence. Ngayon, ang gusto ni OP, for prudence, bago magbigay ng signing authority, may COC na. So front-loaded yung COC,”Rodolfo explained.

[Things have changed. Previously, the signing authority would then be signed by the Trade Secretary and then returned to the President and he would ratify and obtain a certificate of concurrence. Now, what the Office of the President wants, for prudence, before giving signing authority, is to have a COC; so the COC is front-loaded.]

Last year, the DTI estimated that the Philippines could generate P150 billion to P200 billion worth of foreign direct investments (FDI) within three years from the FTA with South Korea. Rodolfo noted the revenue would particularly come from the electric vehicle value chain and, perhaps, in agricultural processing. Rodolfo said wiring harness is included under the EV value chain.

Domestic market keeps driving Boracay tourism; exceeds pre-pandemic arrivals

By Ma. Stella F. Arnaldo @akosistellaBM Special to the BusinessMirror

IT’S convenient, has the best beach, and “feels like home.” Those are among some of the reasons banker Anna Francesca (surname withheld) goes to Boracay Island to relax and de-stress.

“I go there to escape the city [Metro Manila] and rest, not to tour its sites or engage in touristic activities. So if my schedule permits, I go after work on Friday, then leave on the first flight out on Monday, to return to work,” she told the B usiness M irror . “At the resort, I wake up, have breakfast, work if needed, then have a nap on the beach [or just chill, sunbathe, read], swim.... When I’m hungry I just walk to get something to eat. And I’ve already made a number of friends there,” she added.

While she’s only visited the island once this year, last year she traveled there about six times. But no other beach in the country can compare in terms of its quality, she asserted.

Boracay is constantly rated among the best islands in the world or in Asia by international travel publications or websites. At other beaches in the country, many of which she has also visited, “you’re stuck at their resorts unlike in Boracay, you can walk to eat, swim, drink, etc. And it’s so much easier to drive to the airport instead of driving to the beaches near Metro Manila (e.g. Laiya, Batangas, or Zambales).”

1.34M from January to July

LIKE Anna Francesca, many Filipinos continue to be drawn to Boracay despite pandemic international travel restrictions having been eased since last year. Data provided by the Malay Tourism Offfice showed some 1.34 million individuals visited the island from January to July this year, almost 66 percent of the 2-million total arrivals in 2019, prior to the pandemic.

Of the seven-month total this year, domestic travelers reached close to 1.06 million, accounting for 79 percent of the island’s visitors. This already exceeded the total domestic arrivals on the island of 932,433 in 2019. Residents in the National Capital Region have accounted for 40 percent of the total domestic travelers in Boracay this year.

Foreign tourists, on the other hand, numbered 253,264, accounting for some 19 percent of the total visitors in the seven months to July this year. Overseas Filipinos or overseas Filipino workers who arrived on the island were 31,232. The Bureau of Immigration defines overseas Filipinos as Philippine passport holders permanently residing abroad. Prior to the pandemic, Boracay received 2 million visitors in 2019, more than half of who were foreigners.

S. Korea tops foreign tourists

SOUTH Koreans topped the list of foreign tourists on the island during the sevenmonth period this year, at 104,460; followed by visitors from the United States at 24,782; China at 19,757; Taiwan at 13,833; and Australia at 10,734.

According to Malay Chief Tourism Officer

Felix Gregorio delos Santos, arrivals from China remained tepid, with few arriving “especially those from Beijing and Wuhan.” China was the top source market of foreign tourists in 2019, at 434,175. Since China reopened its borders to outbound travel in January, the first Chinese tourists in Boracay this year arrived on April 18 at the Kalibo International Airport via chartered flight from Changsha, aboard OK Airlines, which brought 180 tourists.

The Department of Tourism hopes the new electronic visa (e-visa) platform to be introduced by the Department of Foreign Affairs will help boost Chinese tourists in the country. The e-visa platform will be pilot-test in China starting August 24. The projected travel boom by Chinese citizens has yet to materialize due to the slowdown in its economic growth, inadequate international flights, and slow renewals of passports. (See “China summer outbound travel 53 percent below pre-Covid,” in the BusinessMirror, August 4, 2023.)

₧4-B daily budget hole to be filled with debt

Continued from A1

Continued from A1 Peninsula, Soccsksargen and Caraga, damage and losses caused by Super Typhoon Egay in the agricultural and fishery sector now amounts to P4.47 billion.

T he typhoon affected “170,510 farmers and fisherfolk, with total volume of production loss at 152,041 metric tons [MT] and 195,539 hectares [ha] of agricultural areas,” the bulletin shows.

T he affected commodities include rice, corn, high-value crops, livestock and poultry, and fisheries.

Damage was also incurred in irrigation systems, agricultural and fishery infrastructures, and fishing paraphernalia.

Damage and losses in rice amounted to P1.75 billion with affected area at 111,5477 ha and volume of production loss at 42,754 MT, or 0.21 percent of the total annual production target volume for rice at 19.76 million MT. For corn, damage and losses amounted to P1.74 billion with affected area at 81,998 ha and volume of production loss at 95,658 MT, or 1.03 percent of the total annual production target volume for corn at 9.30 million MT. Raadee S. Sausa

The remaining P606.850 billion will be secured by the national government from abroad through program loans (P295.845 billion), project loans (P36.005 billion), bonds, and other inflows (P275 billion).

“But because the na tional budget is heavily weighted toward interest, it does not provide the full picture. The amortization and principal payments are automatically appropriated and not included in the national budget,” he said.

H owever, if the principal amortization requirement of P3.4 billion a day is added to the interest payment of P1.83 billion, “real” debt service expenditures would be around

P5.2 billion daily, Recto said.

The national government’s debt service next year, which is expected to account for 12.1 percent of the overall budget, will increase by 14.43 percent to P699.2 billion from this year’s P611 billion.

Broken down, P670.5 billion will go to interest payments, while P28.7 billion would be for net lending, based on the budget documents.

“Gross borrowings next year—to finance the deficit, debt, and development—have been forecasted to reach P2.46 trillion, or about P6.7 billion daily,” Recto said.

The former Senate President Pro Tempore said that at almost P1.7 trillion annually, “Personal Services,” an expense class term for

The BBOI said this generated 1,927 new jobs for the autonomous region. The latest approved investment was quite big, coming from Illana Bay Beach Resort in Badak, Datu Odin Sinsuat, Maguindanao del Norte, according to the BBOI.

This single investment carried a project cost of P340,316,249 and was approved during the BBOI board meeting last week.

The BBOI said the Illana Bay Beach Resort is a tourism-related facility and “poised to become a premier destination that showcases the natural beauty and cultural heritage of the Bangsamoro Autonomous Region.”

This venture stands as a testament to the commitment of both private and government sectors to drive progress and prosperity in the region, said BBOI Chairman Omar Pasigan.

The beach resort project is expected to generate 69 jobs, mostly coming from the community, Pasigan added.

By Jonathan L. Mayuga @jonlmayuga

ADVOCATES of a toxic-free environment welcome the initiative of the government in investing in climate-neutral approaches and direction toward a circular economy. However, BAN Toxics Inc. said a more sustainable approach to address the concerns of overproduction and consumption is needed as the country embarks on the full implementation of the Extended Producer Responsibility (EPR) law, particularly on plastic packaging waste.

BAN Toxics Policy Development and Research Head Jashaf Shamir A. Lorenzo issued the statement in reaction to recent policy pronouncements of Environment and Natural Resources Secretary Maria Antonia Yulo-Loyzaga. The Department of Environment and Natural Resources (DENR) serves as the lead responsible agency and has released the implementing rules and regulations (IRR) of Republic Act 11898.

As DENR chief, Yulo-Loyzaga is spearheading the campaign to enjoin big companies to implement wasterecovery programs to reduce plastic waste production. Recently, the DENR chief also announced the move to explore co-processing with cement companies to make use of plastic waste as fuel in the production of cement.

“The BBOI recognizes the positive impact that such initiatives have on the socioeconomic landscape, enhancing the quality of life for the people of the region,” he said.

The BBOI would continue to facilitate a conducive environment for investments and partnerships “that will drive progress and prosperity in the Bangsamoro Autonomous Region,” a statement by the agency read Board of Governor Datu Habib S. Ambolodto said the BBOI “congratulates the proponents of the Illana Bay Beach Resort for their vision and commitment.”

“We are confident that this project will not only contribute to the economic growth of the region but also serve as a catalyst for further investments, development, and cooperation,” Ambolodto added.

Last May the approval of four investments in the Barmm lifted the BBOI’s prospects of meeting its targets for this year.

“We believe that we are now reaping the results of the BARMM administration’s investment initiatives,” Pasigan said citing the target for fiscal year 2023 at P2.5 billion. (See https://businessmirror.com. ph/2023/06/19/four-companies-pourp1-16-billion-worth-of-investmentsin-barmm/) materials, and promoting the eco-design of products, to reducing and minimizing waste generation during the production process to enhance the efficacy of the legislation.”

The group believes “reducing plastic use is the most effective means of avoiding plastic waste. Therefore, EPR implementation must be guided by principles of sustainable production, consumption, and zero waste to reduce plastic use substantially. Strengthening it requires addressing the plastic governance across its lifecycle, with a priority on upstream solutions.”

“Our policies and regulations would benefit from a systems change approach to tackle the root causes of plastic pollution. A significant reduction in plastic use could be achieved by focusing on redesigning products based on their societal function and transitioning towards sustainable plastic alternatives. We need stronger commitments from the industry to move away from non-ecologically acceptable packaging towards more sustainable alternatives and innovations.” the salary and other compensation of national government employees and the pension of uniformed personnel, “would come up to P4. 6 billion a day.”

According to BAN Toxics, banning single-use plastics, which are primarily derived from plastic packaging, is a practical solution to prevent plastics from burdening waste management systems.

But while the government will be spending P15.8 billion a day, BIR and the Bureau of Customs are projected to only collect P8.3 billion and P2.7 billion daily, respectively, for a combined P11.16 billion a day.

“B ecause not all that will be appropriated will be disbursed, the deficit to be financed will be about P3.7 billion daily,” Recto said.

The national government’s budget deficit next year is anticipated to fall to P1.356 trillion, or about 5.1 percent of GDP. This year’s programmed budget deficit is P1.499 trillion, or about 6.1 percent of GDP.