FDI net inf lows fall to $961M in April
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•• 6 SECTIONS PAGES • VOL. 120 NO. 268 32
THURSDAY, JULY 11, 2019
Term-limits petition at SC has transcendental importance for the nation First of 2 parts
OBSERVER YEN MAKABENTA
First word I V E lawyers and three concerned citizens joined together last Monday, July 8, 2019, to file at the Supreme Court a special civil action for mandamus to compel the Commission on Elections (Comelec) to enforce the provisions of the Constitution on the term limits of elective officials under Sections 4 and 7, Article VI of the Charter. äMakabentaA4
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Suicide bomber a ‘battered son’ BY DEMPSEY REYES
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HE country’s first suicide bomber was a battered son who ran away from home in 2014, five years before he and another extremist blew themselves up outside a military camp in Jolo, Sulu, killing six people, according to the Philippine National Police (PNP). ä’Battered son’A2
n Norman Lasuca
Bato, a clown in the staid Senate
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ESIN MY LINE PITE OF SIGHT the series of exposés in this column and on social media, the human trafficking syndicate at the Ninoy Aquino International Airport (NAIA) has not stopped operating. äTulfoA5
RAMON T. TULFO
Are Filipinos dumb for supporting Duterte?
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REPUBLIC SERVICE RICARDO SALUDO
HE antiDuterte c r o w d are again scratching their heads, tearing their hair out, and throwing up their hands. Or just getting more smug about being the only sane ones among 105 million Filipinos.
äSaludoA5
MISS EARTH WINNERS
Miss Earth Philippines 2019 Janelle Lazo Tee (center) celebrates with the other winners who were crowned on Wednesday in Manila — Ana Monica Tan (second from left), Miss Earth Philippines Air; Chelsea Fernandez (second from right) Miss Earth Philippines Water; Alexandra Marie Dayrit (right), Miss Earth Philippine Fire; and Karen Nicole Piccio (left) Miss Ecotourism. PHOTO BY J. GERARD SEGUIA
What’s inside USE EMERGENCY POWERS VS TRAFFIC, DUTERTE URGED NewsA2 SLANDERING THE REPUBLIC
Sara denies text rejecting Cayetano DAVAO City Mayor Sara DuterteCarpio on Wednesday denied having a hand in a text message allegedly sent by her camp to legislators urging them to vote for whoever they want for speaker,
n In this file photo taken on October 31, 1992, independent presidential candidate Ross Perot speaks at the University of South Florida in Tampa, Florida. Perot’s shockingly strong performance as a thirdparty candidate in the 1992 presidential race helped seal Democrat Bill Clinton’s victory over incumbent George HW Bush. AFP PHOTO
Antonio ContrerasA4 URBAN DESIGN
Felino PalafoxA5 REGIONAL CUISINE’S DEVOTED ‘TIYO’
THURMAN ALL SET TO DESTROY PACQUIAO
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defying the wish of her father President Rodrigo Duterte. The denial came after Anak Kalusugan party-list Rep. Michael “Mike” Defensor confirmed receiving a text
Ross Perot, who sought US presidency, dies at 89 WASHINGTON: Ross Perot, the selfmade billionaire and computer industry giant, whose two runs for president as an outsider shook up American politics, died Tuesday (Wednesday in
Manila) at 89, his family said. “A true American patriot and a man of rare vision, principle and deep compassion, he touched the lives of countless
äPerotA8
message on Monday night from someone “very close” to Duterte-Carpio, saying the President was “set-up by greedy Cabinet members” allied with Taguig
äDeniesA2
US Embassy: No truth to Chang appointment THERE is no truth to the report that Deputy Assistant Secretary Mina Chang has been appointed as United States Ambassador to the Philippines, the US Embassy in Manila said on Wednesday.
äChangA2
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FDI net inflows fall to $961M in April BY JORDEENE B. LAGARE
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ET inflows of foreign direct investments (FDI) posted a double-digit decline in April amid positive balances in the month, the Bangko Sentral ng Pilipinas (BSP) said on Wednesday.
In a statement, the central bank said the amount of investments made by foreign individuals or entities in the country dropped by 11.8 percent to $961 million in April from $1.1 billion in the same month a year ago. “Equity capital placements emanated largely from Thailand, the United States, Singapore, Hong Kong and Japan,” it added. These investments were channeled
into the financial and insurance; real estate; manufacturing; electricity, gas, steam, and air-conditioning supply; and construction industries. In contrast, non-residents’ investments in the country, consisting mostly of loans extended by parent companies abroad to their local affiliates, climbed by 12.6 percent to $830 million from $737 million a year earlier. Also, reinvestment of earnings rose
by 14 percent to $92 million from last year’s $80 million. In an interview on Wednesday, BSP Governor Benjamin Diokno credited this particular increase to the country’s recent credit upgrade and easing inflation rate. “Alam mo ‘yung (Have you looked at) foreign direct investments? I’ve looked at the data globally, it’s been declining. ’Yung sa atin (Here, it’s) increasing? That shows confidence. With the recent developments, baka tumaas pa (it might go up),” Diokno told repoters on the sidelines of the 2019 Awards Ceremony and Appreciation Lunch for BSP Stakeholders. Investments, according to the BSP chief, also got a lift after survey com-
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billion from P340 million; and tourism accommodation, P8.6 billion from P1.2 billion. Of the total investment pledges in the six months ending June, 96 percent are spread to areas outside the National Capital Region (NCR). Region 4A (Cavite, Laguna, Batangas, Rizal and Quezon provinces, or Calabarzon) remains the top investment location, receiving P201.2 billion. It is followed by Region 3 (Central Luzon) with P27.7 billion; NCR, P11.3 billion; Region 2 (Cagayan Valley), 8.7 billion; and Region 7 (Central Visayas), P7.7 billion. According to Trade Undersecretary Ceferino Rodolfo, among the
äPledges B4
Liberalizing foreign ownership in retail trade business
UR present government has been pushing to liberalize foreign ownership restrictions to drive growth. Among the sectors the government is looking at to liberalize is the retail trade. It is also looking at introducing amendment to the Public Service Act (Commonwealth Act No. 146) and the Foreign Investment Act (Republic Act [RA] No. 7042) in this regard. For today’s article, we will discuss the proposed amendments to liberalize the retail trade sector.
Retail Trade Nationalization Law For many years, our retail trade
MORE TO FOLLOW (MTF)
AZIZA BACAY sector has been subjected to stringent foreign ownership restrictions to protect Filipino retailers. Until 2000, the conduct of retail trade business was limited only to Filipino citizens and/or corporations wholly-owned by citizens of the Philippines. This was the rule set out in RA No. 1180, known as “Retail Trade Nationalization Law” enacted on June 19, 1954, the first law regulating retail trade
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pany Social Weather Stations (SWS) reported that 80 percent of Filipinos were satisfied with the performance of President Rodrigo Duterte in the second quarter of 2019. “That’s unusual on his third year. [Isn’t that] fantastic? We’re doing great,” Diokno said. Year-to-date, net inflows dropped by 14 percent to $2.9 billion from $3.4 billion in from January to April 2018. “This developed on account of the decline in net equity capital investments as placements dropped by 44.5 percent to $712 million from $1.3 billion, coupled with a 204.9-percent increase in withdrawals to $377 million from $124 million during the period,” the BSP explained.
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PH TRADE DEFICIT NARROWS IN MAY
Investment pledges up 27% to P304B in H1 INVESTMENT pledges approved by the Board of Investments (BoI) grew by 27 percent to P304.4 billion in the first half of 2019 from P238 billion in the same period a year ago. In a statement on Wednesday, the BoI, an attached agency of the Department of Trade and Industry, said the power sector had the biggest share in total investments in the period with P192.4 billion, up 77.9 percent from last year’s P108.2 billion. Investment pledges in manufacturing amounted to P45.3 billion in January to June, a 128.4-percent increase from P19.8 billion in the first six months of 2018; information and communication, P33.2
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THURSDAY JULY 11, 2019
Business Times
CURRENCY RATE
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NO TO NIPPON
Notices campaigning for a boycott of Japanese-made products are displayed at a store in Seoul, South Korea on Tuesday. Japan said it does not plan to retract or renegotiate its stricter controls on high-tech exports to South Korea, a day after the South Korean president urged that the issue be resolved through diplomacy. The signs read: “We don’t sell Japanese products.” AP PHOTO
‘Rate cut first before easing RRR’ A reduction in interest rates is likely to come first before the banks’ reserve requirement ratio (RRR) is trimmed, according to Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno. “Palagay ko mauuna ‘yung interest rate cut bago [ang] reserve requirement (I think the interest rate cut will come first before the reserve requirement is eased),” Diokno said on the sidelines of the 2019 Awards Ceremony and Appreciation Lunch for BSP Stakeholders at the central bank’s headquarters in Manila on Wednesday. His remarks come after monetary authorities last month took what it called a “prudent pause” on slashing interest rates — retaining overnight borrowing, lending and deposit rates at 4.5 percent, 5 percent and 4 percent, respectively, after it cut policy rates by 25 basis
points (bps) — on the back of what he described then a “manageable inflation outlook” and “firm domestic growth prospects.” “Latest baseline forecasts indicate that inflation remains likely to settle within the target range of 3 percent ± 1 percentage point for both 2019 and 2020, while inflation expectations have moderated further,” Diokno had said. In May, the BSP’s policymaking Monetary Board reduced the RRR of universal and commercial banks by 200 bps from 18 percent to 16 percent; of thrift and savings banks by 200 bps from 8 percent to 6 percent; and of rural and cooperative banks by 100 bps from 5 percent to 4 percent. An initial 100-bps reduction took effect on May 31, followed by a 50-bps cut on June 28. A 50-bps decrease is expected by July 26.
The Monetary Board’s next policy meeting is set for August 8. In an email, ING Bank Manila senior economist Nicholas Antonio Mapa said Diokno had embarked on the task to lower reserve requirements after his immediate predecessors, Amando Tetangco Jr. and the late Nestor Espanilla Jr., had “laid the groundwork for a successful and almost seamless exit from an era of high RRR.” “As such, we can expect the BSP to slash borrowing costs (RRP) further as inflation grinds lower, penciling a RRP cut as early as the August meeting, as 2Q GDP (second-quarter gross domestic product) is expected to fall slightly below potential,” he said. “Meanwhile, we can expect reductions [in] the RRR to be carried out at a non-monetary
äRRR B4
THE country’s trade deficit decreased to $3.28 billion in May from $3.46 billion in April and $3.889 billion a year ago as exports improved and imports contracted, the Philippine Statistics Authority (PSA) reported on Wednesday. According to the state-run statistics agency, total export sales in the month inched up by 1 percent to $6.16 billion from $6.09 billion in May 2018. Total value of imported goods,
äDeficit B4
Firm: POGO office-space demand to top BPOs’ THE Philippine offshore gaming operator (POGO) industry is expected to surpass the business process outsourcing (BPO) sector in terms of office-space demand in almost two decades this year amid warmer relations between the Philippines and China. In a briefing in Makati City on Wednesday, Leechiu Property Consultants (LPC) Executive Officer David Leechiu said that “for the first time in 19 years, POGO will surpass BPO demand in office spaces.” For this year, LPC expects office
äBPOs’ B4
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