PAL flies direct to Sapporo, Japan


JJB wd Hokkaido governor

Philippine Airlines (PAL) has expanded its network in Japan with the recent launch of direct service to Sapporo.

President Jaime J. Bautista (left) presented a model aircraft as a gift to Hokkaido Governor Harumi Takahashi at her office in Sapporo, Japan after  unveiling PAL’s new thrice weekly non-stop Manila-Sapporo service starting September 10, 2018, using PAL’s new Airbus A321neo aircraft.

Gov. Takahashi hailed PAL’s new route as a boon for tourism in Hokkaido, Japan’s largest and northernmost prefecture, and cited the success of the 2017 Filipino movie “Kita Kita” as an incentive for Filipinos to visit Sapporo.


JICA pledges assistance to Philippine shipbuilding industry

The Japan International Cooperation Agency (JICA) has pledged to provide Japanese experts to boost the Philippines’ shipbuilding and ship repair industry.

Maritime Industry Authority (Marina) administrator Rey Guerrero has expressed optimism that that JICA is taking the initiative to collaborate with Marina by extending technical assistance and expertise.

Guerrero said JICA’s aid will greatly help in promoting and developing the Philippine shipbuilding industry.

“We are hoping to further improve this relationship for the interest of Japan and Philippine maritime industry,” Guerrero added.

JICA Senior Representative Tetsuya Yamada assured Marina that JICA will continue to extend technical assistance and expertise in developing standard design for locally made ships, establishing the Philippines’ first maritime industrial hub and in setting up a financing facility for local shipbuilders and ship owners.

JICA expressed support in the implementation of MARINA’s 10-year Maritime Industry Development Plan (MIDP) which guides the MARINA in making the local shipbuilding and ship repair industry globally-competitive and technologically-responsive.

MARINA is in process of drafting the rules and regulations in addressing the increasing number of obsolete vessels operating for more than 30 years to further uphold safety and security within the Philippine maritime borders.

NEDA sees double-digit growth in manufacturing sector

downloadThe National Economic and Development Authority expects a double-digit growth in the manufacturing sector in the first half of 2018 following a 20.6 percent increase in the volume of production.

Economic Planning Secretary Ernesto Pernia says robust domestic and higher external demand, increased investments and overseas Filipino workers’ (OFW) dollar remittances, improved consumer confidence, and stable business confidence backed this growth in manufacturing sector.

In June alone, manufacturing volume grew by 18 percent while production value grew 18.9 percent.

Majority of the subsectors posted high production indices, including food manufacturing, petroleum products, and export-oriented products.

Growth in the production volume of construction-related manufactures eased in June.  However, net sales of cement, glass products and basic metals recorded double-digit growth at 10.1 percent, 15.8 percent, and 29.8 percent, respectively.

The increased production of construction-related manufactures was in response to the continued demand for non-residential buildings such as industrial, commercial and institutional buildings.

“The prospect for the second half of the year is bright. We hope to further climb this upward trajectory as we implement reforms positively affecting the industries and doing business in the country,” Pernia said.

“To further drive manufacturing growth, local government units can be capacitated more to attract investments in manufacturing and manufacturing-related services outside Metro Manila,” Pernia added.

ICTSI posts 6% drop in net income in first half of 2018

MICT's new quay cranes 7 June 2018

The International Container Terminal Services, Inc. (ICTSI) posted a 6-percent drop in net income to US$97.7 million in the first half of 2018 from US$103.6 million in the same period last year.

ICTSI attributed the drop in income to the start-up costs of the new port terminals in Papua New Guinea and Australia and the US$7.5 million non-recurring gain on the termination of the sub-concession agreement in Nigeria in the second quarter of 2017.

The company’s revenue rose 10 percent to US$661.8 million from US$603.7 million in 2017.

ICTSI handled consolidated volume of 4,714,255 twenty-foot equivalent units (TEUs) in the first six months of 2018, four percent more than the 4,545,405 TEUs handled in the same period in 2017.

The increase in volume was primarily due to the robust global trade activities particularly in the emerging markets, continuing volume growth at most terminals and the contribution of the new terminals in Lae and Motukea in Papua New Guinea, and Melbourne, Australia.  Excluding the new terminals, volume increased by one percent.

Fitch affirms Philippine economy’s stable outlook

Fitch Ratings has affirmed the Philippine economy’s stable outlook with a BBB rating.

The sovereign ratings balance a favourable growth outlook, government debt levels, a net external creditor position and policies geared towards maintaining macro-stability against lower income per capita and weaker governance and business environment.
Fitch says a strong macroeconomic performance remains a rating strength, notwithstanding overheating risks.

Real GDP expanded by 6.8% in 1Q18 from 6.7% in 2017, supported by strong growth in investment and private consumption.

Growth in investment was driven by a pick-up in the public-infrastructure program ast domestic demand to maintain strong growth of 6.8% in both 2019 and 2020, which would maintain the Philippines’ place among the fastest-growing economies in the Asia-Pacific region.

Fitch says the Philippines’ estimated five-year average real GDP growth of 6.5% at end-2018 will remain far above the current ‘BBB’ median of 3.1%. However, the economy faces some overheating risks, evident from a recent rise in inflation, rapid credit growth and a widening trade deficit, although steps taken by the Bangko Sentral ng Pilipinas (BSP) to tighten monetary policy may contain these risks.

Headline inflation increased to 4.3% yoy in 1H18 from 2.9% in 2017. Fitch expects consumer price inflation to average around 4.4% in 2018, above the BSP’s official band of 2%-4%, due in large part to higher commodity prices and a recent increase in excise taxes associated with the tax reform package passed at the end of last year.

Fitch expects the  the Philippines’ current account deficit to widen to -1.1% of GDP in 2018 from -0.8% of GDP in 2017, driven by continued strong growth in the import of capital goods associated with the government’s public-investment programme and higher oil prices.

The business-process outsourcing sector’s continued strong receipts and steady remittance inflows are offsetting these factors and helping to contain a further widening of the current account deficit. We expect the deficit to widen further to around -1.3% of GDP in 2019 and 2020. Risks to this outlook stem from a further acceleration of imports.

Foreign direct investment (FDI) inflows rose to USD10.0 billion in 2017 from USD8.3billion in 2016. Approved FDI investments declined from a year ago but realised FDI inflows rose by around 43.5% yoy in 1Q18 to USD2.2 billion, reflecting still-strong foreign investor sentiment.

High foreign-exchange reserves continue to act as an important buffer to external shocks. Foreign-exchange reserves had fallen to USD77.7 billion by end-June 2018 from USD81.6 billion at end-2017 due to portfolio outflows and intervention by the BSP.

However, reserves continue to cover around seven months of current external payments (CXP). In addition, the BSP’s flexible exchange-rate policy, evident from a depreciation of the peso by around 6% against the US dollar over the past year, should prevent a sharp decline in reserves.


Filipino millenials are less impressed with Philippine politicians – Deloitte

Filipino millennials are less impressed with politicians with 52 percent believe political leaders currently have a negative impact on society, while 43 percent believe politicians are having a positive impact.

The latest Deloitte’s 2018 Millennial Survey revealed that in 2017, 91 percent of Filipino millennials felt that the Philippine government made a positive impact in solving the issues they were most concerned about.

When it comes to the economy, Filipino millennials are less upbeat, with 78 percent of them expecting the Philippines’ overall economic situation to improve this year – an 11-point drop from last year’s survey.

The percentage of Filipino millennials who expect the country’s overall social and political situation to improve in the next 12 months contracted even more, from an impressive 84 percent in 2017 to 68 percent this year.

This result may be related to the similarly waning confidence Filipino millennials have on businesses and the government.

In 2017, 94 percent of Filipino millenials believed businesses have a positive impact on wider society, down to 74 percent this year.

Forty-seven percent of Filipino millennials say businesses should focus on providing employment, and 40 percent of them believe their employers are actually prioritizing this.

When it comes to improving society, however, only 23 percent of Filipino millennials believe their organizations are working on this goal, even as 42 percent of them say businesses should prioritize it.

Deloitte’s survey noted a gap when it comes to protecting the environment, with 32 percent of Filipino millennials believing businesses should play an active role in doing so, but only 16 percent saying their employers prioritize it.

An overwhelming majority of Filipino millennials expect to be financially better off  with 86 percent and happier  with 80 percent than their parents, an improvement from last year’s 80 percent who expected to be financially better off and 76 percent who expected to be happier.


This improved sentiment is mirrored globally, suggesting that even millennials in developed markets have found reasons to feel more optimistic about their future.

Convenience stores lead growth in small store format

Convenience stores are leading the expansion of the small store format concept in the Philippines, showing a growth of 20% in 2017 and 15% in 2016.

Nielsen’s latest shopper trends report noted that in 2013, there were only more than 1,620 convenience stores in the country against 4,300 in the first quarter of 2018.

Small store formats are modern trade self-service stores occupying an area measuring 150-500 square meters. These stores cater to more frequent shopping trips with smaller baskets. Convenience stores, small supermarkets, petrol stores and mini-marts all fall under the small store category.

Big retailers are not far behind in adopting the small store format. In the last five years, small store formats of supermarket chains have grown close to 220 stores in 2013 to more than 410 stores in the first quarter of 2018.

The growth of small format stores is bolstered by the increasing influence of four global megatrends which are supporting the growing consumer demand for faster and more convenient shopping experiences—urbanization, women joining the workforce, shrinking household size, and the rise of eating out. The robust business process outsourcing (BPO) segment also stimulates the growth of this retail channel.

“Retailers in the past were guided by  the paradigm that “bigger is better” but as lifestyles and consumption habits change, a shift in where consumers shop, what they buy, the frequency and amount of spend follow,” says Patrick Cua, Nielsen’s managing director in the Philippines.

“Small format stores meet a distinct shopper need of convenience as they are often situated near homes or high traffic areas.”

“It is no surprise that small-store format shoppers value stores that deliver on time-saving or convenience-related elements,” says Cua.

Philippines’ ODA loans disbursement level up 11.5%

The Philippine government’s disbursement level of official development assistance (ODA) loans has increased by 11.5 percent to US$1.40 billion in 2017 from US$1.25 billion in 2016, according to the National Economic and Development Authority (NEDA).

NEDA says the cumulative actual disbursement rate increased by 6 percent to 71.50 percent. The disbursement ratio—or the ratio of actual disbursements for a given year to the loan balance available at the beginning of that year inclusive of newly effective loans—increased to 16.66 percent, an increase of 29 percent from the previous year.

“This means implementing agencies are improving their technical capacities and making headway in resolving key issues that cause delays in the execution of programs and projects,” Socioeconomic Planning Secretary Ernesto M. Pernia said.

The Philippines’ total outstanding ODA portfolio for the full year of 2017 reached US$14.72 billion, constituting 352 grants amounting to US$2.42 billion and 70 loans amounting to US$12.30 billion.

The infrastructure sector continued to receive the largest share of the total ODA at US$6.62 billion, accounting for 45 percent of the total amount, followed by social reform and community development at 26.11 percent.

Japan remained the top provider of ODA to the Philippines in 2017 with loans and grants for 2017 stood at US$5.33 billion, accounting for 36.18 percent of the country’s total ODA portfolio, followed by the World Bank with US$3.07 billion (20.88%) and the Asian Development Bank with US$2.97 billion (20.16%).

Of the total 407 projects and programs assisted by ODA loans and grants, 271 projects (66.58%) were on schedule while 79 (19.41%) were completed. Fifty-two projects (13%), on the other hand, were behind schedule while five (1%) were closed with incomplete outputs.

PAL ranked in top 50, voted 2nd most improved airline

PAL logo with 4 Star sealSkytrax, a leading UK-based research and consultancy firm, has ranked Philippine Airlines (PAL) 49th in world airline standings and second most improved airline in the world for 2018.

In its latest survey, PAL’s ranking has improved by 34 notches from 83rd two years ago and 18 notches from 2017.

PAL was recently certified as a full-fledged 4-star global airline by Skytrax and voted into the top 50 in the recent survey involving 20 million passengers, 100 nationalities and 335 airlines carried out by the independent rating and audit firm.

PAL President and Chief Operating Officer Jaime J. Bautista was elated with pride and joy.  “This latest win shows how far we have come in working to transform our airline, and this victory is especially sweet because it reflects the votes of our beloved customers. We are honored to be recognized by millions of passengers, and we renew our commitment to keep on serving them better from the caring heart of the Filipino.”

The latest international accolade was announced after PAL recently acquired its first ultra-modern Airbus A350-900, one of the world’s most advanced commercial aircraft.

“The 4-Star award, Top 49 ranking and the 2nd Most Improved Airline vote challenge us to keep up the progress, and our hi-tech new A350s and A321neos mark our determination to hit full 5-Star status by the end of 2020,” said Mr. Bautista.

PAL Chief Customer Experience Officer Jessica Abaya said PAL was also ranked in the top 30 in the World’s Best Cabin Cleanliness category. “This recognition inspires us to focus even more on delighting our customers. It also gives us greater confidence to reach our long term vision of becoming the 5-Star, full-service national carrier of the Philippines.”

PAL Chairman Dr. Lucio C. Tan expressed his gratitude to the 8,000 strong PAL family, citing their team synergy as the crucial factor in making the airline a global winner.

“The future is bright for Philippine Airlines. As the Philippines’ first and only 4-Star Airline, we will continue to provide more innovations and product refinements. Indeed, we will take in 27 new aircraft starting with our new A350s and A321 NEOs, so that we can fly more customers more comfortably and conveniently to their dream destinations.”

PAL remains focused on its key programs which include route network expansion, service innovations and fleet modernization. Its fleet of 89 Airbus, Boeing and Bombardier aircraft now serve a network covering two-thirds of the globe, promising distinctly Filipino heartfelt service as the international market leader in Philippine aviation.


A republic without plates no more

After two years of delay and bureaucratic red tape, vehicle owners can now get their plates from The Department of Transportation (DOTr).
The Philippines has been branded as “Republika ng Walang Plaka,” (a republic without plates).
Transportation Secretary Arthur Tugade said that the scathing criticism to the government of being a “Republika ng Walang Plaka” is now finally over.
House Committee on Transportation Chairman Cesar Sarmiento hailed the release of the plates as a “day of celebration.”
When Secretary Tugade assumed his post, one of his marching orders was to make sure that the problem on the lack of vehicle plates be resolved the soonest possible time.
One of the long-term solutions was to establish a plate making facility that would allow the government to manufacture plates on its own. Since April to July 4, 2018, the facility has produced a total of 231,332 pairs of motor vehicle plates.
Secretary Tugade reminded transportation officials and employees to cut bureaucratic processes and corruption to ensure public services are delivered efficiently.