THE MANILA TIMES | JUNE 27, 2019

S&P slashes PH growth projection anew to 6.1% »Story on B1 HH

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•• 5 SECTIONS PAGES • VOL. 120 NO. 257 28

THURSDAY, JUNE 27, 2019

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‘Chinese can’t fish in PH territory’

n Rep. Lord Allan Velasco

Velasco leads Speaker race MARINDUQUE Rep. Lord Allan Velasco is leading the race for the top post in the House of Representatives after getting a good number of signatories from members of the chamber and an endorsement from the administration party.

On Wednesday, Sen. Emmanuel Pacquiao, campaign manager of the ruling Partido Demokratiko Pilipino-Lakas ng Bayan (PDP-Laban), announced that the party had picked Velasco as its official bet in the incoming 18th Congress.

Velasco’s rivals from the same party are Pampanga Rep. Aurelio

Carpio warns sharing marine resources with China violates Constitution

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BY JOMAR CANLAS

LLOWING Chinese fishers to fish in Philippine waters is illegal, Supreme Court Associate Justice Antonio Carpio said on Wednesday as he slammed President Rodrigo Duterte’s decision to share the country’s marine resources with China.

Carpio said permitting Chinese fishers to gather resources inside the country’s exclusive economic zone (EEZ) violates the Constitution.

“The Philippine government cannot allow Chinese fishermen to fish in the Philippines’ exclusive economic zone in the West Philippine (South China) Sea because it will violate the

Constitution,” he said in a statement.

The magistrate cited Section 2, Article XII of the 1987 Constitution, which states: “The State shall protect the nation’s marine wealth in its archipelagic waters, territorial sea, and exclusive economic zone, and reserve its use and enjoyment exclusively to

äTerritoryA2

äLeadsA2

Is the President the solution or the problem in Reed Bank controversy?

First Word N the United States, the often-heard lament is that national security adviser John Bolton has too big a role in the administration of Donald Trump; ‘tis said that Bolton is the one orchestrating US moves in the current face-off with Iran.

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OBSERVER YEN MAKABENTA

äMakabentaA4

The only way to solve our drug problem

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DISIN MY LINE TURBOF SIGHT ING report about the peace and order situation in the Philippines is detailed in a book, The Mastermind, written by award-winning journalist Evan Ratliff.

MANO PO

A girl gives respect to President Rodrigo Duterte, who welcomed to the Palace the family of Xia Ngo (left). Ngo had a successful liver transplant through the help of senator-elect Christopher Lawrence ‘Bong’ Go. CONTRIBUTED PHOTO

Bernal to direct SONA again

RAMON T. TULFO

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What’s inside SOTTO BACKS DUTERTE’S CALL FOR CHARTER CHANGE

NewsA2

Antonio ContrerasA4

PARK BO GUM EntertainmentD1

The first was in 2018, when the President’s speech was delayed for more than an hour because of an argument between lawmakers Pantaleon Alvarez and Gloria Macapagal Arroyo regarding the voting for the House speakership.

According to Lubid, Bernal — whose popular works include box office hits like “Kailangan Ko’y Ikaw,” “Till There Was You,” “Don’t Give Up on Us,” “Kimmy Dora,” “Everything About

Her,” “The Super Parental Guardians,” “Gandarrapiddo: The Revenger Squad” and “Miss Granny” — would start conducting rehearsals on July 13.

Bernal is expected to do some minor changes on camera angles and shots, and require additional equipment while documenting the President’s speech.

Last year, she said she accepted the

äDirectA8

Robots to take 20M jobs, worsen inequality

A PLAGUE UPON OUR LAND

A ‘GOOD DAY’ FOR

FILM and television director Joyce Bernal will once again direct President Rodrigo Duterte’s State of the Nation Address (SONA) on July 22.

This was confirmed by Radio Television Malacañang official Jun Lubid at a briefing on SONA preparations at the House of Representatives on Wednesday.

This will be the second time for Bernal to direct the SONA’s TV coverage.

RAPTORS CHIEF UJIRI CONFIDENT KAWHI WILL STAY IN TORONTO

SportsC1

WASHINGTON, D.C: Robots are expected to take over some 20 million manufacturing jobs worldwide by 2030, extending a trend of worsening social inequality, while boosting overall economic output, a new study shows.

The forecast set to be released Wednesday highlights growing concerns that automation and robots, while offering economic benefits, are disproportionately killing low-skill jobs and aggravating social and economic stress.

The study by Oxford Economics, a private British-based research and consulting firm, said job displacement from the rise of robots would not be

äInequalityA2

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S&P slashes PH growth projection anew to 6.1% S

BY MAYVELIN U. CARABALLO

&P Global Ratings reported on Wednesday that it further reduced its Philippine growth forecast for 2019 to 6.1 percent from 6.3 percent, citing lower first-quarter expansion, state spending for infrastructure and an accomodative monetary policy as reasons for the revision.

The debt watcher’s revised outlook for the country’s economy is its second this year, with the previous figure itself a downward adjustment for the initial 6.4 percent.

The latest projection is higher than last year’s actual growth of 6.2 percent and falls near the lower end of the government’s downwardly revised 6.0-7.0

percent target.

S&P said the 5.6-percent gross domestic product (GDP) growth posted in the first quarter was lower than expected on account of the delay in passing this year’s national budget, as well as weak external demand.

Despite this, it noted that the recent drop in the jobless rate indicated that

the labor market “still appears strong.”

Unemployment fell to 5.1 percent in April from 5.5 percent in the same month last year — equivalent to 2.286 million out-of-work individuals, compared with 2.360 million previously — according to the Philippine Statistics Authority’s latest Labor Force Survey.

“This could provide support to the private domestic economy to offset some of the headwinds from trade and the negative fiscal impulse in the first half of 2019,” S&P said.

A dispute between Congress’ two chambers over alleged insertions resulted in the four-and-a-half-month delay of the passage of this year’s budget. This forced the government to run on last year’s budget, limiting it to spend for items detailed in the 2018 outlay and

not on programs and projects supposed to be implemented this year.

“We continue to expect GDP growth to come in at the low end of the 6-6.5 percent range in 2019, with a likely resumption of the infrastructure build in the second half of the year to bring the fiscal impulse for the year to around neutral after being negative in the first half of the year,” the debt watcher added.

Earlier, the country’s economic managers unveiled their “catch-up plan” that set an infrastructure spending target of P792.97 billion for the second to fourth quarters after actual infrastructure spending reached P207.2 billion in the first.

“We also expect BSP (Bangko Sentral

äGrowth B3

BTr: Govt ‘Firms to hire fewer workers in Q3’ Foreign biz chambers: to borrow Speed up CIT reduction less in Q3 THE government would borrow less from local sources in the third quarter, according to the borrowings program released by the Bureau of Treasury (BTr) on Wednesday.

July-to-September borrowings was set at P230 billion, down 26.3 percent from P315 billion in April to June and 23.3 percent from P300 billion in the same period last year.

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BUSINESSES in the Philippines plan to hire fewer employees despite their stronger expansion plans for the third quarter of 2019, a Bangko Sentral ng Pilipinas (BSP) survey found.

Results of the recently released Business Expectation Survey (BES) put the confidence index (CI) of companies with expansion plans at 33.5 percent, up from 33.2 percent in the previous quarter.

The CI is calculated as the net of percentage of companies that replied in the affirmative and the percentage of firms that answered otherwise on their views about a given indicator.

“Stronger expansion plans were recorded across subsectors, except

for manufacturing, whose expansion plans were unchanged from a quarter ago,” the central bank said.

Despite this, survey results also showed the employment outlook index fell to 26 percent from 29.7 percent.

“This suggests that more firms will continue to hire new employees, although the number of new hires may be lower, compared to [those found in the] previous quarter’s survey,” the BSP said. “[E]mployment prospects were generally expected to moderate across sectors, except for the services sector which remained steady,” it added.

The employment outlook is consistent

BOURSE DIPS ON DENTED HOPES OF FED RATE CUTS THE stock market finished lower on Wednesday as investors felt disheartened by the US Federal Reserve’s announcement that it was insulated from political pressures on rate cuts.

The benchmark Philippine Stock Exchange index (PSEi) dropped by 0.26 percent or 20.52 points to close at 8,013.57, while the wider All Shares declined by 0.23 percent or 11.49 points to end at 4,897.51.

“Curbed hopes of monetary easing by the Federal Reserve plunged the local bourse,”

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brokerage firm Philstocks Financial Inc. said, referring to news on Tuesday that the US central bank pushed back on expectations of an interest rate cut at their next meeting, which President Donald Trump has been asking for.

Its chief, Jerome Powell, said the Fed was “insulated from short-term political pressures.”

In a separate comment, P2P Trade Online sales associate Gabriel Jose Perez said the local market mirrored the decline on Wall Street,

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Du30 drops the ball on electric rate relief

LECTRICITY consumers in the country — which is to say, about 90 percent of the population — will soon be saddled with even higher costs, thanks to our wildly popular president’s having ignored the issue.

On Monday, the Power Sector Assets and Liabilities Management Corp. (Psalm) announced that it was seeking to recover P10.84 billion in stranded contract costs and debt from consumers. This would follow

another Psalm-induced rate hike totaling P5.12 billion (or P0.0543/kWh) imposed earlier this month.

The new rate increase will be in two petitions to the Energy Regulatory Commission (ERC), which will almost certainly approve them in line with its understanding of its mandate to pass all possible costs, no matter how unreasonable, on to the consumer. The first, totaling P6.12

ROUGH TRADE BEN KRITZ

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Proposed amendments to REIT IRR MORE TO I FOLLOW (MTF) N last week’s article, we mentioned that it has been almost 10 years since the passage of (RA 9856), or “An Act Providing the Legal Framework for Real Estate Investment Trust and for Other Purposes” (REIT Act). However, up to this date, no REIT has been established in our country.

We mentioned that there have been issues in establishing a REIT, which discouraged real property owners from establishing it. However, after 10 years, many things have changed. It has been the view of many that the market is ready for a REIT launch. Also, it has been confirmed by the Train 1 Law (RA 10963) that

the transfer of real property to a REIT is exempt from the value-added tax (VAT).

The other issues are the qualifications of the other players of a REIT. The main players of a REIT are the Sponsor or Promoter (the owner of the real assets) and the Investors (the unit owners or stockholders of the REIT).

In addition, however, the REIT Act requires the designation of a Fund Manager and a Property Manager.

The fund manager is responsible for the allocation of the deposited property to the

EUNEY MARIE MATA-PEREZ

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with the less-optimistic overall business sentiment for July to September.

Firms were less upbeat for the next three months, with the index sliding to 47.6 percent from 52 percent three months earlier.

“Business optimism was dampened [by] expectations of interruption of business activities during the rainy season and stiffer competition,” BSP Department of Economic Statistics Director Redentor Paolo Alegre Jr. has said.

The latest BES, which polled 1,501 companies nationwide, was conducted from April 1 to May 28. Its results are considered indicative of the direction of overall business activity.

MAYVELIN U. CARABALLO

TWO foreign business groups have urged the government for a quicker reduction of the corporate income tax (CIT) rate under House Bill 8083 or the Tax Reform for Attracting Better and Higher-quality Opportunities (Trabaho) measure.

In a recent interview, GermanPhilippine Chamber of Commerce and Industry (GPCCI) Executive Director Martin Henkelmann said Trabaho was “one of the bills that need focus,” and “it should be clear how they (lawmakers) would [address] the question of

incentives.”

“I think there are very positive developments in the bill, such as reducing the corporate tax.

However, we are worried that it is not going fast enough,” he added.

“We hope they would reduce the corporate tax faster….”

One of the proposed packages of the government’s Comprehensive Tax Reform Program, Trabaho seeks to reduce corporate income tax from the current 30 percent to 20 percent in 10 years, and rationalize

äReduction B3

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