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CURRENCY RATE
PSEi
7,848.83 DOWN 0.48%
P52.25 TO $1
FRIDAY AUGUST 23, 2019
Business Times
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ASIAN STOCKS: s Shanghai 0.11% s Singapore 0.17% t Seoul 0.69% s Tokyo 0.05% t Jakarta 0.22% t Hong Kong 0.84% t Bangkok 0.24%
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July ‘hot money’ inflows hit $15M FOREIGN portfolio investments reverted to the positive territory after $15.02 million of these flowed into the Philippines in July, data from the Bangko Sentral ng Pilipinas (BSP) showed on Thursday. Net inflows of these investments, also called “hot money” — so named because of how easily these enter and leave the economy — last month were a reversal of June’s $35.72-million net outflows, but was lower than the year-earlier net inflows of $53.29 million. In a statement, the central bank said the July inflows could be attributed to “better-than-expected inflation data for the month of June, coupled with easing domestic inflation for the second quarter of 2019 and [a] stronger peso forecast.” Consumer price growth in the country slowed to 2.7 percent in June from 3.2 percent in May. The interagency Development Budget Coordination Committee sees the peso ending the year between P51 and P53 against the US dollar, stronger than its previous assumption of P52-P55:$1. Registered gross foreign portfolio investments amounted to $1.68 billion in July, up 75 percent from $959.44 million a year ago. Inflows also rose by 19 percent from $1.41 billion a month ago. The BSP said the bulk, or 76.5 percent, of foreign portfolio investments went to Philippine Stock Exchange-listed securities — mainly banks; holding firms; property companies; retail firms; and food, beverage and tobacco companies. Peso government securities accounted for the rest.
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I F 2020 B U D G E T N OT PA S S E D O N T I M E
‘PH growth to fall below 5%’ A BY MAYVELIN U. CARABALLO
reenacted 2020 national budget could drag Philippine economic growth to below 5 percent next year, Socioeconomic Planning Secretary Ernesto Pernia warned on Thursday.
“We will have a regressing economic growth performance of probably below 5 percent or [somewhere near that figure],” Pernia told lawmakers during the Development Budget Coordination Committee briefing on the proposed national expenditure for 2020 at the House of Representatives
in Quezon City. He was asked for his gross domestic product (GDP) growth outlook if the proposed P4.10-trillion national budget for next year would not be approved on time, just like what happened to the 2019 appropriations.
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SC ruling on IRA a risk to economic growth
POWER TO THE PEOPLE
President Rodrigo Duterte looks at a map of the area to be powered by the Tumingad Solar Power Project, which was inaugurated in Ondiongan, Romblon on Wednesday. With him is Energy Secretary Alfonso Cusi. MALACAÑANG PHOTO
A Supreme Court (SC) ruling requiring increased transfers from the central government to local government units (LGU) by 2022 was tagged as a domestic risk to Philippine economic growth going forward. “In light of the SC ruling on the Mandanas case, the absorptive capacity of LGUs may pose risk in terms of the performance of the Philippine economy as a whole,” Socioeconomic Planning Secretary Ernesto Pernia told lawmakers during the Development Budget Coordination Committee briefing for the proposed national expenditure for 2020 held at the House of Representatives on Thursday. Gov. Hermilando Mandanas of Batangas was the lead petitioner of the case filed in 2012, for which the High Court issued the decision that local governments’ internal
Cut CIT rate faster – biz chambers TWO business chambers on Thursday offered contrasting views on the proposed Comprehensive Income Tax and Incentive Rationalization Act (Citira) bill — which seeks to lower corporate income taxes (CIT) and rationalize fiscal incentives — but they are one in saying that the CIT rate should be reduced more quickly. The European Chamber of Commerce of the Philippines (ECCP) said that while it supports the lowering of these taxes, the government must make sure that the incentives continue to be competitive. ECCP Executive Director Florian Gottein told The Manila Times that the cut in CIT should also be faster. “While the ECCP appreciates the lowering of the CIT to help attract more investments, the
proposal to reduce the CIT rate by 2 percentage points every two years is deemed too little, too slow,” he said. Under the measure, formerly known as the Tax Reform for Attracting Better and High-quality Opportunity (Trabaho) bill, the CIT rate would be gradually lowered from 30 percent to 20 percent in 10 years. “The ECCP urges the government to start reducing the CIT rate to 25 percent at the onset and an annual 1-percent-point reduction until the proposed 20-percent CIT rate is reached,” Gottein said. “We also urge the government to come up with a competitive fiscal regime as quickly as possible to dispel any uncertainties on the country’s fiscal regime,” he added. Citira proposes to scrap the
n This August 8, 2019 file photo shows Socioeconomic Planning Secretary Ernesto Pernia speaking during a briefing on the second-quarter gross domestic product growth in Pasig City. PHOTO BY ALVIN I. DACANAY
5-percent tax on gross income earned (GIE) currently being paid by firms in lieu of local and national taxes. The GIE will take effect once firms’ income tax holidays expire. For its part, the Philippine Chamber of Commerce and Industry (PCCI) expressed full support for Citira. “PCCI believes the Citira bill is fair and enough in its offer to streamline tax incentives. While it cut down on certain incentives, it also gave more generous incentives to targeted recipients,” PCCI President Alegria Limjoco said. “We believe Citira did not abolish, but only redirected incentives, still keeping in mind the overall value they bring to national development,” she added. Like Gottein, Limjoco also
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n NEDA Undersecretary Rosemarie Edillon. PHOTO BY ALVIN I. DACANAY revenue allotment (IRA) should be based on all national taxes and not just IR taxes. Providing further details, National Economic and Development Authority (NEDA) Undersecretary Rosemarie Edillon said the
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Coal Asia, Ever Gotesco listed but not Phisix stocks G T Capital Holdings Inc. increased its ownership in Metropolitan Bank & Trust Co. (MBT) to 1,448,393,313, or 36.39 percent, from 1,447,016,063, or 36.36 percent after it bought additional MBT common shares in two trades. In a disclosure posted on the website of the Philippine Stock Exchange (PSE), Metrobank said GT Capital bought 877,250 MBT common shares on Aug. 15, 2019 and 500,000 MBT common shares on Aug. 16, 2019. The two transactions cost P96,195,750. The same filing showed GT Capital bought 877,250 MBT common shares at P69.93 each and 500,000 MBT common shares at P69.70 each on Aug. 16, 2019.
As of June 30, 2019, GT Capital owned 1,447,016,063 MBT common shares, or 36.36 percent, according to the bank’s public ownership report (POR). It was listed as the sole principal stockholder. The same POR listed Metrobank’s public stockholders as holders of 1,949,400,082 common shares, which then were equivalent to 48.98 percent of 3,980,015,036 outstanding MBT
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