ODA law changes to let PHL acquire modern air, naval gear

By Jovee Marie N. dela Cruz @joveemarie

THE House Committee on Ways and Means will present amendments to the Official Development Assistance (ODA) Law to ensure that the country has the flexibility “to acquire top-ofthe-line air equipment and naval capabilities.”

H ouse Committee on Ways and Means Chairman Joey Sarte Salceda is pushing for the passage of a bill expanding the range of ODA options for the country, which includes allowing local governments to access ODA loans and VAT reliefs for such borrowings.

“ Let’s build our defenses so that countries that have their eyes on the West Philippine Sea don’t feel like they can push us around so easily,” Salceda said.

“ Again, countries like us shouldn’t declare that our only option is diplomacy. No one wants war, but defenders don’t decide that. Aggressors decide whether they want war. And defenders have to be ready,” Salceda added.

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T he Senate Technical Working Group is currently holding meetings on RCEP amid strong opposition from stakeholders in the agriculture sector, who said they were not

Under the current ODA Law, Salceda explained, the country is restricted by provisions that put a grant component floor of 40 percent of the total ODA loans, and at least 25 percent of each loan.

O ther limitations include the lack of provisions for private sector participation in financing, and the public bidding requirement, which may hinder loans for acquisitions such as defense equipment, which typically already have a single eligible supplier.

“ That hinders us from acquiring, say, French submarines although France has already signalled its intent to make loans for these available.”

S alceda added that in 2021, Defense Security Cooperation properly consulted by the government prior to the approval by former President Rodrigo Duterte. The PCCI chief, nonetheless, is hoping that the Senate will concur in the ratification of RCEP this 19th Congress.

B arcelon also noted that countries which have ratified the regional trade pact are already seeing increases in

Agency, or DSCA of the United States already cleared the Philippines to acquire F16s from the United States.

We were also cleared to purchase Harpoon missiles, which would definitely deter any naval incursion into our waters,” he said.

“ The message you want to send to adversarial countries is, well, we will never recourse to war as a first option, but we are ready to defend. And your attacks against us will cost you,” he added.

Salceda assured the public, however, that the loans for defense capabilities “will remain deeply concessional, especially with EDCA and other similar military arrangements.”

ODAs remain the cheapest way to borrow. They are still deeply concessional. The capital markets do not give you a grant component. And certainly, they do not come with technical capabilities and knowledge-sharing,” he said.

S alceda added that ODA law amendments will require “that the ODA loans are still concessional compared to borrowing their “overall trade.” from the market.”

Trade Secretary Alfredo E. Pascual, in his pitch at the Senate two weeks ago, said RCEP is not just a “simple” trade agreement, since as an ASEANled free trade agreement (FTA), it will ensure the region’s “continued economic advantage” and will help maintain a “balance of power” within the region.

“ But the ODA Law was written when we were still a country struggling out of political and economic crises. We are now on the cusp of being an uppermiddle income country. In the OECD’s definition for ODAs, we’re so close to not being eligible for any ODA already. The grant component for peer countries is 10 percent grant element, 6 percent discount rate. The current law requires ODA loans to be 25 percent grant component, at 10 percent discount rate,” he said.

At the rate we’re growing, soon, no ODA will qualify at our stage of development. And that, of course, is bad for our long-term development needs. Especially because ODA loans are very long-term, unlike most capital market instruments,” he added.

T he House Committee on Ways and Means has conducted preliminary discussions on private sector participation in official development assistance, ahead of formal discussions on House Bill 7135, or amendments of the ODA Law.

Among the economic advantages, the Trade chief said is the preferential treatment arising from “enhanced” market access, wider sourcing of raw materials, among others.

P ascual noted that while the regional trade deal is not a “magic bullet” that will solve the country’s problems in various sectors, it will provide an “enabling environment.”

Hence, the government and business sector must still do their part to make local industries more productive and more competitive, he added.

RCEP is a free trade agreement among Asean countries and their trading partners Australia, China, Japan, New Zealand and South Korea. Touted as the world’s largest trade pact, RCEP represents 30 percent of the global gross domestic product (GDP). See related story in Economy.

Foreign chambers, too T HE American Chamber of Commerce of the Philippines, Inc. (AmCham) issued a similar statement for ratification.

“ The Philippines cannot afford to leave itself out of the bloc since being a member will harness economic benefits that will hasten economic recovery from the scars, higher debt and economic damages caused by the COVID-19 pandemic,” the AmCham said. The Chamber believes that the Philippines’s participation in RCEP will boost the country’s competitiveness and will reflect a strong, rules-based economy. This will encourage more foreign direct investments (FDIs) in the country which ultimately translates into more jobs for Filipinos,” the statement added.

We strongly urge the Honorable members of the Philippine Senate to immediately ratify RCEP,” the chamber said, noting that the agreement is already in force in Australia, Brunei, Cambodia, China, Indonesia, Japan, Korea, Malaysia, New Zealand, Singapore, Thailand and Vietnam.

W idely, long debated on For his part, Ortiz-Luis of ECOP said doubts about the country’s competitiveness to enter into a free trade deal are misplaced.

We have lessons in the past, we enter into negotiations without involving the private sector. And by the time we are allowed to take part there are already promised safeguards, especially in the agriculture sector, that have disappeared, so there are bad lessons.

“ Fortunately, in the case of RCEP, this is widely debated on and for a long time, so we are already familiar. And if there are vacuums, these have been filled up, there are safeguards already,” he said.

A s to perceived fears about RCEP’s disadvantageous effects on the agricultural sector, the ECOP head said that these have been addressed repeatedly “so the risks are very minimal, if ever.” “We have waited long enough for this (ratification), and we are very late already. All the others have overtaken us,” Ortiz-Luis said.

“ The scenario assumes that the elevated price levels of these commodities will be sustained until end-2023 if the supply constraints are not addressed,” said the Central Bank report.

I n the meat sector, the BSP said pork could remain expensive as the threat of African swine fever (ASF) still crimps expansion plans in the sector. High feeds and logistics costs have worsened that situation for local hog producers, it added.

“Chicken prices have likewise increased in the previous year as high production costs put a strain on producers’ operations,” the report read.

Expansion plans in the sector were also limited by the continued threat of Avian Influenza and the high cost of feed ingredients,” it added.

T he BSP thinks the country could suffer a shortage of fish in the first quarter despite the entry of imports. It cited agriculture department estimates that total fish supply in the January-to-March period is at 688,799 metric tons compared to the total estimated demand of 884,910 MT.

As a result, the projected supply deficit is 196,111 MT for Q1 2023 with a sufficiency level of 77.8 percent,” it said.

H igh onion prices are also seen to remain a factor driving inflation, as only less than a quarter of the approved 21,000 MT of onion imports entered the country.

T he BSP also flagged potatoes as an inflation concern: its price now hovers between P100 and P150 per kilogram from P75 per kilogram in end-Q3 2022.

Prices have steadily gone up starting Q4 of last year. Prices of high-value crops such as potatoes could increase from lower production following weather-related disturbances,” the BSP said.

T he BSP said sugar prices could stay high in the next 12 months if the arrival of sugar imports is delayed, particularly after the harvest and milling season.

“ Based on the 240 by 240 2018 input-output table, the commodities and industries most sensitive to the changes in the price of sugar are soft drinks and juices, chocolates and sugar confectionary, bakery products and alcoholic beverages,” it said.

‘Most aggressive policy’

W DIOKNO, a former BSP governor, said the country’s monetary policy is now considered the “most aggressive” in the region and the impact of the series of interest rate hikes is “working its way” already.

H e noted that the BSP has already implemented a rate hike of 400 basis points (bps) since the start of the year compared to India’s 250 bps, Indonesia’s 225 bps and 100 bps for Thailand and Malaysia.

“ The Executive Department and the LGUs should intensify the implementation of more di -

15 hotels...

rect, non-monetary measures to help address the supply issues,” he said.

D iokno’s statement came a few days after the Monetary Board increased the BSP’s overnight reverse repurchase facility by 50 bps to 6 percent to ease accelerating inflation that rose to a higher-than-expected rate of 8.7 percent in January, the fastest in more than 14 years. (Related story: https:// businessmirror com.ph/2023/02/17/monetaryboard-deals-50-bps-rate-hikemore-in-future/)

T he BusinessMirror earlier reported economists’ warning that inflation could outpace the country’s economic growth this year, especially if no steps are taken to mitigate supply side constraints. (Related story: https:// businessmirror .com.ph/2023/02/10/ economists-warning-inflationcould-outpace-growth/)

TWG soon

DIOKNO said the national government will form a “small” technical working group (TWG) of various executive agencies for an “objective” and “timely” assessment of the country’s food supply and demand conditions.

T he TWG members are the National Economic and Development Authority, Department of Finance, Department of Budget and Management, Department of Trade and Industry and Department of Agriculture.

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This responsibility should be taken away from vested groups. This will help ensure timely actions to avert short-term upticks in food prices,” Diokno said.

T he peso-dollar exchange rate is stabilizing within the range of P54 to P55 while global prices of oil and oil products are now within “reasonable” levels, he noted. If the Executive Department succeeds in controlling the sources of inflation on the supply side more effectively, there will be less reason for monetary authorities to raise policy rates,” he said.

D iokno said the national government, particularly the DA, has initiated import measures to augment local supply and stabilize prices of certain commodities such as onion and sugar. “ But timely importation of food items in short supply is not enough. There has to be a focused effort to ensure that the imported goods reach the intended markets as soon as possible,” he said.

D iokno urged the Bureau of Customs to immediately release imported food items with the “same sense of urgency” that it showed in the importation of Covid-19 vaccines. “ Local authorities should facilitate, not impede, the movement of essential food items to the intended markets. Restricting free movement of essential food items is one sure way of prolonging inflationary pressures,” he said.

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A lthough inbound, I would say is starting to come in, but it’s not as strong as pre-pandemic levels, but we’re hopeful [this will rise],” she noted.

S peaking on the sidelines of HSMA’s first general membership meeting and induction of its new officers on February 16, So added that online sales are also driving average daily rates (ADR) and revenues of hotels.

“ADR is also higher compared to the prepandemic [period], because right now, online business is very strong, so it’s better than the average rate, instead of the groups, I think because during the pandemic the online business really evolved so much.”

S he underscored that online bookings also help give the best rates possible for the guests.

“When it’s an online [transaction], obviously, our buyer is also dynamic. When I say dynamic, depending on the influx of bookings, we can switch our prices right away, either higher or lower. So if the demand is not very strong, let’s say on Mondays and Tuesdays, then we will bring our prices lower. And then if the demand is high, we can bring it higher. So that’s why I think with this dynamic rate structure, ADR is really going to go up because again, we’re able to adjust very, very fast.”

P rior to the pandemic, ADR reached P5,000 per night, as hotel occupancy rates reached 70 percent especially on weekends in 2019, according to STR, a leading global provider of data and insights for the hotel industry.

By Cai U. Ordinario @caiordinario

MAJORITY of widowed and more than half of Filipinos who were separated, divorced, or annulled nationwide were women, according to the latest data from the Philippine Statistics Authority (PSA).

Data from the 2020 Census of Population and Housing (CPH) showed there were a total of 3.88 million Filipinos who were widowed while 1.64 million were separated, divorced, or annulled.

Of the widowed Filipinos, some 2.95 million were women while 988,943 of those who were separated, divorced, or annulled were female.

“The proportion of persons reported as widowed was higher among females than males across all age groups. The same trend was observed among individuals who were divorced/separated/annulled,”

PSA said.

The number of widowed women in the country represented 76.02 percent of all widowers in the country while women who were separated, divorced, or annulled accounted for 60.14 percent of the total.

Among women who were widowed, those aged 65 to 69 years old represented the age group with the highest number at 442,795 of the total.

This was followed by women aged 80 years and over with