Q2 growth seen to hit 6%
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A group of men transport a motorcycle and its owner by using an improvised boat in Marilao, Bulacan. The downpour spawned by the southwest monsoon and a weak tropical storm had drenched Metro Manila and nearby provinces. In Marilao, knee-high floods brought misery to commuters and motorists alike. PHOTO BY RENE H. DILAN
Big hole in US cavalry fantasy: US has not ratified Unclos First word HERE is a big hole in the fantasy of some officials like Sen. Panfilo Lacson who believe that the United States can be asked to intervene in the South China Sea dispute and then ride in like the US cavalry scuttling the ranks of the Indians. äMakabentaA5
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OBSERVER YEN MAKABENTA
Values before skills should be taught in school
RESIIN MY LINE DENT OF SIGHT Digong has jumpstarted his campaign against corruption and incompetence in his administration by removing and replacing a member of his official family. äTulfoA5
RAMON T. TULFO
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China rejects third party in boat probe BY CATHERINE S. VALENTE
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HINA had rejected President Rodrigo Duterte’s proposal to include a third party in the joint investigation of the ramming of a Philippine boat by a Chinese vessel in the Recto (Reed) Bank in June, Malacañang said on Monday.
Palace spokesman Salvador Panelo said China preferred a joint investigation with the Philippines. “Sumagot na ang China. Nag-offer sila ng joint investigation, tapos in-accept ni Presidente, tapos may third party. Ang sabi naman nila, huwag na ‘yung third party. Kailangan tayo lang ang mag-usap doon (China has responded. They said they offered to have a joint investigation, then the President accepted it, but there should be a third party. They said there’s no need for a third party, let’s keep the discussion between us),” Panelo said in a news briefing. “Para sa kanila, hindi na kailangan ‘yun
äRejectsA2
What’s inside MONSOON RAINS ELEVATE ANGAT DAM LEVEL
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TITO’S FISH TALES Antonio ContrerasA5
KRIS AQUINO TO RECLAIM ‘HORROR QUEEN’ TITLE IN NEW FILM
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DURANT OPTS FOR NETS AS NBA FREE AGENT FRENZY BEGINS
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DUQUE’S BROTHER ALSO CHARGED WITH PLUNDER AT OMBUDSMAN GONZALO Duque, the brother of Health Secretary Francisco Duque 3rd, was impleaded in the plunder complaint earlier filed against the Health chief by parents of children suspected to have been victims
of the Dengvaxia vaccine. The complainants filed on Monday a joint supplemental complaint-affidavit before the Office of the Ombudsman against Gonzalo. The supplemental complaint was filed by Ariel
Hedia, Ruby Hedia, Darwin Bataan, Merlyn Bataan, Sonia Guerra, Liberty Ganzore, Raul Galoso, Elloly Galoso, Raymond Ancheta, Cecilia Torres, Danilo Bautista, Sheryl Bautista and Edna Santos.
In the charge sheet, they alleged that the Health secretary conspired with his brother Gonzalo to enrich himself. They claimed that Duque took “advantage
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PH can be a center of innovation – envoy ISRAELI Ambassador to Manila Rafael Harpaz believes that the Philippines could become a “cluster of innovation for startup” companies because young Filipinos are highly educated and service-oriented. Harpaz made the stateTHE MANILA TIMES ment during a roundROUNDTABLE table discussion with The Manila Times editors on Monday. “I think the Philippines can be a cluster of innovation for startups. And I think part of the areas that we are developing is actually the relationship that we can share our experience with technology and innovations here, and I think the Philippines has a great potential for it,” he said. Asked how the Philippines could adopt n Ambassador Rafael Harpaz. and take advantage of Israel’s technological
äInnovationA2
PHOTO BY ROGER RAÑADA
Honasan assumes top DICT post
n Secretary Gregorio Honasan 2nd
takes his oath of office before President Rodrigo Duterte.
FORMER senator Gregorio Honasan 2nd on Monday assumed his post as secretary of the Department of Information and Communications Technology (DICT). Honasan, whose appointment was formalized in November last year, took his oath of office before President Rodrigo Duterte on Monday afternoon, according to Executive Secretary Salvador Medialdea. Palace spokesman Salvador Panelo said Duterte announced Honasan’s appointment during the Cabinet meeting on Monday. “Yes, former senator Gregorio Honasan has joined us in the Cabinet meeting. He took his oath of office just before the Cabinet meeting. He is the new DICT
äPostA8
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ASIAN STOCKS: s
s
PSEi
8,043.71 UP 0.55%
P51.05 TO $1
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Shanghai 2.22%
What’s inside REFORMING THE SACHET ECONOMY – MANAGING BusinessB2 FOR SOCIETY
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BANKS’ Q1 DEPOSIT LIABILITIES HIT P12T
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Seoul 0.04%
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To k yo 2 . 1 3 %
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AGI SETS P410-B FIVE-YEAR CAPEX
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OIL PRICES INCREASE ON RIYADH-MOSCOW DEAL
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Bangko Sentral ng Pilipinas (BSP) official said on Monday monetary authorities forecast Philippine economic growth to hit 6 percent in the second quarter, a projection shared by the First Metro Investment Corp. (FMIC) and the University of Asia and the Pacific (UA&P). On the sidelines of the Pre-State of the Nation Address (SONA) Economic and Infrastructure Forum at the Philip-
demand for goods, although it was also driven by firms working through pre-existing orders and raising postproduction stocks,” IHS Markit said in a report. The results, however, also showed that new orders increased at the softest rate in 11 months due to the decrease in new orders from abroad. Employment also declined for the fourth consecutive month, as firms failed to replace those who resigned. This drop, however, was softer than the one recorded in May. In terms of prices, IHS Markit said manufacturers imposed a “subdued increase in input costs.” Only 7 percent of them, it added, reported an increase in supplier prices due to the higher dollar rate and increased taxes.
äManufacturing B4
pine International Convention Center in Pasay City, BSP Deputy Governor Diwa Guinigundo — who was to retire
on Tuesday — said the central bank was “looking at about 6-percent (growth)” for April-to-June. The figure is higher than the 5.6-percent gross domestic product (GDP) growth posted in the first quarter, and matches that recorded in the same period last year. Government spending boosted economic expansion, according to Guinigundo, adding that lower inflation played a big part. “With lower inflation, consumption expenditure will be stronger. With low
inflation and low interest rates, private investments will also be important drivers of economic growth,” he said. After the country registered slowerthan-expected economic growth in January-to-March — mainly blamed on the fourth-and-a-half delay in the approval of the 2019 national budget — the central bank’s policymaking Monetary Board cut on May 9 its overnight borrowing, lending and deposit rates by 25 basis points to 4.50 percent, 5 percent and 4 percent, respectively,
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ture Forum” at the Philippine International Convention Center in Pasay. Asked for a timeline, Dominguez answered that the tax bureau would begin “making the collections in July.” Most of these foreign workers, he said, are from the Philippine offshore gaming operators (POGO) industry, to which the government is losing about P2 billion a month for every 100,000 foreign workers.
TOY STORY
A vendor arranges toys bearing the likeness of characters from the hit movie Avengers at his booth during a summer carnival in Beijing on Sunday. AP PHOTO
At P2 billion a month, the amount of taxes to be collected from the industry would hit P24 billion a year — a revenue source that was non-existent some four of five years ago, before President Rodrigo Duterte handed over control of these POGOs to the state-run Philippine Amusement and Gaming Corp. (Pagcor). Earlier, the tax bureau said foreigners and nonresident aliens planning to work in the country must secure their tax-
payer identification number (TIN) after estimates showed that the government was losing billions in income taxes from unregistered foreign workers. This followed a joint guideline signed by the BIR with the Labor and Justice departments and the Bureau of Immigration requiring these workers to secure a TIN before they can secure a special working or alien employment permit.
The BIR said it matched the list of foreigners hired by local companies with records provided by government agencies, which showed big discrepancies on the number of foreigners employed and reported by them to the bureau. This prompted the BIR to issue batches of notices requiring these employers to pay withholding taxes of P4.44 billion.
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A calamity of government management
F the Office of the President, the National Housing Authority, and the Housing and Urban Development Coordinating Council were doing their jobs, the Commission on Audit reported last week, at least some of the victims of calamities such as 2013’s Bohol earthquake and Typhoon Yolanda and 2017’s destruction of Marawi City would not still be living as refugees years after the events. The more things change, the
more they stay the same, as the saying goes; it is disappointing, but perhaps not surprising that the current administration seems no better at faithfully accounting for and deploying large amounts of liquid funds in an ethical and practical way than any of its predecessors. The headlined issue in the CoA’s latest report is some P1.4 billion in funds designated for disaster relief and other worthwhile pur-
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Peso to average P52.10:$1 – Fitch unit
BIR to collect foreign workers’ unpaid income taxes THE Bureau of Internal Revenue (BIR) will start collecting from foreign workers this month billions of pesos in unpaid income taxes, Finance Secretary Carlos Dominguez 3rd said on Monday. “I…just talked to the BIR last week and they said they [were ready] to start [collecting] foreign workers’ (unpaid income taxes),” he told reporters on the sidelines of Pre-State of the Nation Address (SONA) Economic and Infrastruc-
B a n g ko k 0 . 6 1 %
Inflation to ease below 3% in June – Pernia, FMIC, UA&P
June manufacturing growth ‘marginal’ THE Philippine manufacturing sector remained subdued last month after only recording slight growth, a IHS Markit survey found. Results of the survey released on Monday showed that the seasonally adjusted Purchasing Managers Index (PMI) for the country marginally improved to 51.3 in June from 51.2 in May. The latest figure is the highest since March’s 51.5. The PMI is a composite index representing the weighted average of new orders, output, employment, suppliers’ delivery time and stocks. Readings above 50 signal an expansion; below that, a contraction. “The marginal rise in the headline index was mostly due to a greater expansion in output [among] Filipino manufacturers. Anecdotal evidence generally related the increase with higher
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Q2 growth seen to hit 6% BY MAYVELIN U. CARABALLO AND ANNA LEAH E. GONZALES
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S i n g a p o re 1 . 5 2 %
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ROUGH TRADE BEN KRITZ poses but instead being hoarded by the OP since at least 2010. The same CoA report also criticized the glacially-slow utilization of P2.0 billion transferred to the NHA and
HUDCC for rehabilitation efforts in Marawi. The P1.4 billion was a donation to the government by the Lopez-owned Benpres Holdings Corp. for “economic development according to a national priority plan,” including assistance to victims and areas affected by earthquakes, floods and other calamities. The original donation of P1.38 billion was turned over to the Treasury on December 30,
2010, where it has remained ever since; it had accumulated nearly P30 million in interest by the end of 2012, according to the CoA, and totals at least P1.412 billion. If this was news to the Duterte administration it might be forgiven for having taken this long to do something about it, and the current leadership could even score a few political points, for what they’re worth, at the expense
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THE Philippine peso is seen to average to P52.10 to the US dollar this year, Fitch Solutions said on Monday, but warned that the local currency’s recent gains would lose steam in the near term. “We expect Philippine peso gains to slow over the near term, averaging P52.10/USD in 2019, as the boost from dollar weakness and hopes of a cooling of trade tensions fade,” the Fitch Group unit said in a report. The projected figure is better than the peso’s weighted average rate of P52.72:$1 at end-2018, based on Bangko Sentral ng Pilipinas (BSP) data.
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Trade talk resumption boosts PSEi THE stock market bounced back to the 8,000 level on Monday as investors welcomed news that trade negotiations between the United States and China will resume. The bellwether Philippine Stock Exchange index (PSEi) grew by 0.55 percent or 44 points to close at 8,043.71, while the wider All Shares rose by 0.45 percent or 21.87 points to end at 4,915.65. “Investors breathed a momentary sigh of relief with trade talks resuming and the Huawei sanction partially lifted,” Regina Capital Development Corp. head of sales Luis Limlingan said. On the sidelines of the Group of 20 (G20) meeting in Osaka, Japan over the weekend, US President Donald Trump announced that Washington and
äBoosts B4
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