MACROECONOMICS WEEKLY UPDATE

The government hopes to seal a loan agreement with China for three flagship railway projects amounting to P276 billion by 2023 Q1. Chinese Ambassador Huang Xilian agreed to restart loan negotiations for PNR South Long-Haul Project, Subic-Clark Railway and Mindanao Railway Project.

  The Department of Transportation expects to complete the upgrade and expansion of 10 regional airports under the public-private partnership program next year in which the $11 billion Sangley Point International Airport, led by the Yuchengco-Virata consortium will start construction by 2023.

President Ferdinand Marcos signed a law Monday requiring mobile users to provide personal details when buying a SIM card, a regulation aimed at combating text messaging fraud. A national ID system covers most Filipinos and will serve as a crucial source document for telcos to counter check IDs that prepaid SIM users present as proof of identity. Telcos are calling for the full rollout to ensure the successful implementation of the newly signed SIM Registration law.

 The Accredited Service Providers Association of PAGCOR (ASPAP) held a press briefing on Monday (October 10) against calls for a POGO ban. According to ASPAP data, 23,118 Pinoys would lose their jobs if the remaining 16 POGOs and 68 service providers went out of business.

Board of Investments (BOI) approved P125.7 billion worth of investments from July 1 to Sept. 14 — the first 75 days of the Marcos administration. This is 160 percent higher than the investment promotion agency’s (IPA) approvals in April to June of P48.4 billion. The P125.7-billion investment is expected to generate 9,000 fresh jobs.

  Foreign Direct Investments (FDI) into the Philippines registered a net inflow of US$460 million in July, this is 64% lower than the US$1,292 million net inflows in July 2021. The FDI in July is the lowest net inflows recorded over the past 14 months. Net inflows from January to July stood at $5.101 billion this year.

There were 2.68 million people unemployed for August, down by 79,000 from July but down by 1.2 million YoY. The underemployment rate climbed to 14.7% from 13.8% the month before.\

    The Philippines Consumer Price Index (CPI) for the month of September quickened to 6.9%, 0.6% higher than the 6.3% YoY growth in August. YTD 2022 inflation is currently at 5.1%, still well above the BSP’s target range of 2-4%, but within DOF’s revised inflation forecast of 4.5% – 5.5%. Food, Alcoholic beverages and Transportation costs increased the most, seeing a jump of 7.4%, 9.8% and 14.5%, respectively. 

POWER AND UTILITIES  

    An infrastructure-oriented think tank is calling on the Energy Regulatory Commission (ERC) to ensure that the rates for emergency and spot market procurement of additional supply will be comparable to the price proposal in the rejected San Miguel Corp. (SMC) and Manila Electric Co. (Meralco) petition.

Manila Electric Company (Meralco) announced Monday a reduction in its overall rate P0.0737 per kilowatt hour to P9.8628 per KWh in October from P9.9365 per kWh last month. For residential customers consuming 200 kWh, the reduction is equivalent to a decrease of almost P15 in their total electricity bill.

Alternergy Holdings Corp. welcomed the move of the Department of Energy to increase the utilization of renewable energy (RE) resources under the Renewable Portfolio Standard (RPS) as it creates a bigger market for the industry. Based on initial estimates by Alternergy, the increase in RPS requirement translates to about 2.65 million megawatt-hours (MWh) RE capacity annually.

INDUSTRIALS

PLDT said it is reserving all of its remedies in case DITO does not cure its latest major payment default within the applicable 30-day period, including the suspension or termination of services under the parties’ service agreement. DITO has until November 4 to pay its P429.7 million debt obligation to PLDT.

Last Friday, TEL served a Notice of Material Breach and Demand for Payment on DITO for its refusal to pay PHP 429.72 million in bills. The amount is for contracted services that TEL has performed relating to the building and provisioning of transmission facilities that DITO required and is using for the delivery of telecommunication services to subscribers.

Cirtek said applications of its two business units for the registration of the expansion and new projects at Laguna Technopark-Special Economic Zone were approved by the board of the Philippine Economic Zone Authority (PEZA). With the PEZA approval, Cirtek Electronics Corp. (CEC)’s expansion project for the manufacture of plastic and ceramic leadless chip carrier packages will be entitled to three years income tax holiday (ITH) on incremental sales and the five percent special corporate income tax (SCIT) for 10 years as provided for under the provisions of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act.

Tech giant Google is teaming up with the Department of Information and Communications Technology (DICT) to make currently-relevant and in-demand ICT training courses available for Filipinos. Google Philippines, in partnership with the DICT’s ICT Literacy and Competency Development Bureau, will offer four courses through Coursera.org. These are IT Support, User Experience Design, Data Analytics, and Project Management.

INVESTMENTS 

Eight listed corporations have been penalized by the Philippine Stock Exchange (PSE) for breaching listing and disclosure rules. These include Campos-led Del Monte Pacific Ltd., F & J Prince Holdings Corp., Manila Broadcasting Co., Virgilio Villar’s Medilines Distributors Inc., Panasonic Manufacturing Philippines Corp., Pryce Corp., San Miguel Corp., and SOCResources Inc. he eight firms were found to have violated Sections 7 and 17.11 of Article VII of the PSE rules.

PHILIPPINE STOCK MARKET UPDATE

The PSEi gained 14.79 pts (up 0.25%) to close at 5,847.37 after three consecutive days of losses.

Trading ended mixed for the sectoral indices, as losses from Mining & Oil (down 0.29%) were partially offset by gains from Industrials (up 0.32%) and Financials (up 1.24%).

Value turnover rose to P4.1B (vs. only P2.3B the previous session) while net foreign selling persisted (-P226M). Top index movers were BDO (up 3.33%), AEV (up 4.03%) and AC (down 2.21%).