DTI warns retailers of over-pricing

The Philippine Department of Trade and Industry (DTI) has warned retailers, distributors and manufacturers against selling basic commodities higher than the suggested retail prices (SRP).

Any retailer found selling above the SRP would be asked to explain the price hike and show the cost of acquisition.

If it turns out that the manufacturer or distributor was the one selling goods higher than the SRP, then DTI will issue summons to these manufacturers or distributors to explain the increase in price.

The DTI said would imposed a P1 million fine to violators under the Price Act subject to the circumstances provided after due notice and hearing.

Criminal liability for illegal price manipulation may result to imprisonment of not more than 15 years and a maximum fine of P2 millionl.

The DTI has published the updated suggested retail prices (SRPs) of basic necessities and prime commodities in major newspapers to guide consumers in their purchases at the same time to alert retailers nationwide to sell within the SRPs.

Based on the recent National Price Coordinating Council (NPCC) meeting, other government offices and industries cited the world price hikes on products and services as the main reason of price increases of goods in the country.

Several manufacturers of milk products, canned goods, noodles, and condiments, have notified the DTI a month ago on the price adjustments of their products, citing the increase in prices of raw materials and production costs as the major reason for the adjustments.

DTI Sec. Gregory Domingo is looking into the adjusted SRPs of these select basic necessities and prime commodities and the results of the comparative price analysis showed that the planned price adjustments were reasonable.

“We have published the updated price guide for the information and guidance of producers, manufacturers, traders, dealers, sellers, retailers, and consumers.”

The SRPs are provided by manufacturers to set retail prices of products so that consumers will know whether the goods are over-priced or above the acceptable profit margin.

DTI Undersecretary for Consumer Welfare Zenaida Maglaya said the  DTI is closely coordinating with the industry sector to ensure that there is proper notification and consultation prior to any adjustments in SRPs.

Maglaya stressed that the SRPs would ensure that businesses are not denied of their right to fair return of investments, at the same time to prevent unreasonable price increases on basic goods.

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Shortage of power supply in Luzon, Mindanao

Luzon may get lucky to experience no brownouts this dry season despite tight power supply that requires 300 megawatts more during day-time peak hours.

Energy (DoE) Sec. Jose Almendras told members of the business community led by the Philippine Chamber of Commerce and Industry (PCCI) that the Visayas, except for a few islands, has escaped the power crisis with the commissioning of three new coal-powered plants in Cebu and Panay. 

The new plants will be more than enough to meet peak demand and required reserve margins in the central Philippines group of islands.

The daily brownouts in Mindanao may persist this year as no new generating capacity is expected to be added.

“We have had a little luck as electricity demand in Luzon went down last December and in January because of the cold weather,” Almendras said.

The biggest island has very thin reserve and may need to import the excess capacity in the Visayas and activate the retired oil-fired generation plant in Navotas if the situation deteriorates.

“We are monitoring the performance of the power plants daily and checking if private sector owners of the sold National Power Corp. (Napocor) plants are upgrading the efficiency of aging plants” he explained.

“We realize that the DoE is not as powerless as earlier thought under the Electric Power Industry Reform Act.”

During the Philippine Business Conference last October, the organization of independent power producers assured the nation’s business leaders that a power crisis in Luzon can be prevented by rehabilitating the aging power plants they bought from the government.

Almendras said his department is concerned about Luzon because the only baseload power plant being built by GN Power will be ready only by 2015.

He was informed by the business leaders that some foreign and local investors are ready to build new plants but they could not hammer out long-term supply agreements with big end-users.

Because of this problem, most of the planned investments have been put on hold while the dependable capacity of power plants in Luzon is getting overtaken by the demand for electricity.

They suggested that DoE must start bidding out power plant projects the way it did to solve the power crisis in the early 1990s.

A recent Supreme Court decision on a power distribution issue in Cebu advanced the legal opinion that the EPIRA law did not strip the DoE of its powers when created by Congress in 1992.

The business leaders were unanimous in their assessment that the current DoE leadership is fully aware and understands the challenges confronting the industry and expressed strong confidence in the capacity of the DoE to solve the problem.

The DoE committed to undertake continuing dialogue with the business leaders as well as other private sector groups to ensure timely and responsive action to the industry’s issues.

Philippine exports up 33% in 2010

The Philippine  exports posted a 33.8 percent growth in 2010 to US$51.43 billion from $38.43 billion during the same period in 2009.

Total imports posted a 26.9 percent annual increase last year to $54.702 billion from $43.092 billion in 2009. The National Statistics Office (NSO) reported that the balance of trade in goods (BOT-G) for 2010 registered a deficit of $3.27 billion, lower than the $4.65 billion deficit in 2009.

Total external trade in goods in 2010 reached $106.13 billion, up by 30.2 percent from $81.52 billion registered during the same period in 2009.

Combined import and export merchandise trade for December 2010 was up by 25.8 percent to $9.13 billion from $7.25 billion in December 2009.

Total merchandise imports increased at 25.2 percent to $4.930 billion from $3.936 billion in December 2009. Total exports, on the other hand, rose by 26.5 percent to $4.201 billion from $3.321 billion in December 2009.

 The balance of trade in goods (BOT-G) in December 2010 posted a deficit of $729.00 million compared to last year’s recorded deficit value of $615.00 million.

Accounting for 34.6 percent of the aggregate import bill, payments for electronic products in December 2010 amounted to $1.706 billion, up by 35.3 percent from $1.26 billion in 2009.

Among the major groups of electronic products, semiconductors having the biggest share of 28.8 percent, expanded by 57 percent to $1.41 billion from $902.97 million in December 2009.

Imports of mineral fuels in December 2010 ranked second with 19.1 percent share and posted a positive growth of 23.7 percent to $940.95 million from $760.54 million in December 2009.

 Transport equipment the country’s third top imports for the month with 7.6 percent share to total imports at $373.61 million. The value accelerated by 77.7 percent from its previous year level of $210.20 million.

Industrial machinery and equipment contributing 4.8 percent to the total import bill, was the country’s fourth top import for the month with payments placed at $236.45 million, an increase of 18.5 percent from last year’s level of $199.51 million.

Fifth in rank and with 2.4 percent share of the total imports was iron and steel which expanded by 91.3 percent, the highest annual growth rate among the top ten imports to $116.83 million from $61.09 million in December 2009.

Chemicals ranked sixth, comprising 2.2 percent of the total imports, reached $106.08 million, higher by 27.2 percent from $83.37 million recorded in December 2009.

The other top imports for December 2010 were telecommunication equipment and electrical machinery worth $104.35 million, up by 41.8 percent; plastics amounting to $99.42 million increased by 46.5 percent; metal products valued at $67.06 million higher by 46.7 percent; and fertilizer with purchases placed at $64.28 million rose by 80 percent.

Manila’s stock market to rebound

After a wave of selling last week, the market is due for rebound as investors would buy back on select blue chips.

“We could see the market make a technical rebound that could get a helping hand if the anxieties in Libya die down, says AB Capital Securities.

 “Sentiments should improve once the worries of a long drawn Libyan civil war will not materialize as Libyan leader Muammar Qaddafi’s hold on power is growing weaker by the day.”

“Major oil producing countries are also downplaying the Libyan situation as they have pledged to provide more oil to the markets if there will be a reduction in oil prices,” says AB Capital. Local investors would get guidance from companies regarding their 2010 performances and their outlook for this year.

Among those scheduled to release their results this week are Aboitiz Equity Ventures (AEV), Aboitiz Power Corporation (AP), the Manila Electric Company (MER) and Metro Pacific Investments Corp. (MPI). AB Capital expects the market, which overcame last week’s strong down ward momentum pressure, was able to maintain certain major support levels last week.

“The first important support that the PSEI has managed to stay above of is its recent low of around 3,720. The local main index’s next major support is at its one year exponential moving average line, which is currently priced at 3,680.”

BPI Securities noted the PSEi managed to end its five-day losing streak closing at 3,737.04, up 6.2 points as investors took their cue from the oversold level of the index to bargain hunt.

The market is likely to consolidate in the near term, trading between 3,680 – 3,750, with support pegged at 3,700. PRC and ALI are reported to have joint plans of redeveloping the 21-hectare Sta. Ana horse racetrack located at the residential area along the borders of Makati and Manila.

Seafarers protest killing of Filipino seafarer by Somali pirates

The Association of Marine Officers and Ratings  (AMOR) has protested the killing of Filipino seafarers by the Somali pirates.

In a statement, AMOR said the whole Filipino seafaring sector mourns the recent killing of Bosun Farolito Vallega, 48,  by Somali pirates.

A cook, Elviro Salazar, 26, was also reported missing and presumed dead.. The pirates had held captive the other crew of M/V Beluga Nomination from the Philippines and East European nations and their fate are still uncertain.

“The killing of Vallega is the first incident in history of seafaring in the Philippines.  It should be noted that Vallega has been onboard to work and earn a decent living for his family. That he was gunned down without mercy is cruelty in the highest level as they killed a father and a model seafarer.”

The group said they are concern with the safety of other seafarer hostages, who at the last count, numbered to 155 according to a report.

AMOR has asked the Department of Labor, Department of Foreign Affairs to name   the 155 hostages held captive by the Somali pirates.

They also said that Vallega’s killing is a very sad story not only for his family but for all Filipinos as well.

“Vallega represents the Filipino seafarers who had been onboard ocean-going vessels for years now.”

The Philippines is world’s biggest supplier of seafarers which numbered 370,000 or 28 percent of the world’s fleet.

“We can not allow further killing of our helpless seafarers.  Governments must do their best to coordinate with other nations to stop the pirates from harming or killing our seafarers,” AMOR said.

“We have reached this far in seafarer supply because we are the best in the world.  But, being the best should not mean our seafarers getting killed.  We must be vigilant and we must be resolved to stop the pirates before they kill our seafarers.”

South Korea reaffirms support to Philippines

South Korea has reaffirmed its commitment in helping the Philippines achieve rice self-sufficiency as it acknowledged the country’s role in promoting rice self-sufficiency in Korea 50 years ago.

In a speech at the groundbreaking of the Korean government-funded Rice Processing Center (RPC) in Pototan, Iloilo, Korean Ambassador Lee Hye Min noted that the project is a way of thanking the Philippines not just for defending South Korea during the Korean War, but also for transforming Korea from net importer to self-sufficient producer.

“Our partnership on rice research, production and capacity-building has come a long way. In the 1960s, with the collaboration of the International Rice Research Institute (IRRI), we produced the Tongil palay, a high-yielding, high quality rice variety, which transformed Korea in the 1970s from a rice importer to a self-sufficient producer,” he said.

Since then, Korea has gained a lot of knowledge on rice production and processing, and it wants to share this to the Philippines through the RPC project, he said.

“Back in 2006, the Korean Government, through Korea International Cooperation Agency (KOICA), established the Korea-Philippines Modern Integrated RPC in Baler, Aurora to produce high-quality rice and reduce losses.

RPC Aurora helped reduce postharvest losses from 15% to 8% as targeted by the Department of Agriculture. Inspired by this success, the Philippine and Korean governments agreed to replicate this model all over the country.

Four more RPCs will be constructed in the major rice-producing provinces of Pangasinan, Bohol, Davao del Sur, and here in the beautiful province of Iloilo.”

The RPC project was made possible through a US$13 million grant from the Korean government. Components include the construction of an RPC, provision of equipment, training of Filipinos in Korea, and dispatch of Korean experts to the Philippines. It is being implemented by KOICA, its grant aid wing, in partnership with the Department of Agriculture and the local governments of the project sites.

Abaca fiber exports to grow 10% in 2011

The Philippine Fiber Industry Development Authority (FIDA) is forecasting a 10 percent growth in abaca fiber exports to 12,300 metric tons (MT) for 2011 from last year’s 11,175 metric tons.
FIDA administrator Cecilia Gloria Soriano is optimistic that full recovery of the export market for abaca could be achieved this year.

The abaca industry has already shown recovery as evident in the significant improvement in the exports of abaca fiber and other abaca-based products last year, as economic growths of importing countries have started to regain momentum.

Total abaca fiber exports in 2010 were projected at 11,175 MT, surpassing by 11.8 percent FIDA’s forecast for the year of 10,000 MT.

January to November shipments of 10,242.67 MT were already 75.6 percent higher than 5,832.2 MT total during the same period of 2009.

Soriano said the biggest markets abroad for Philippine abaca fiber are the United Kingdom and Asian countries especially Japan, China and Indonesia.

Likewise, the country’s shipments of abaca pulp are projected to reach 22,000 MT this year while abaca cordage at 7,700 MT.

Total export revenues from these commodities are estimated at $107.3 million. some specialty papermakers abroad have shifted to the importation of abaca pulp instead of the usual raw fiber because pulping is highly polluting that it harms the environment.

“The stringent anti-pollution control laws in their countries require them to put up anti-pollution control mechanisms which they consider costly,” FIDA said.

China, one of the biggest tea-drinking populations in the world, has been continuously expanding its imports of abaca pulp from the Philippines for the manufacture of tea bags.

Aside from tea bags, abaca pulp are utilized for the manufacture of specialty paper products for coffee filters, meat and sausage casings, currency papers, cigarette papers, filters, hi-tech capacitor papers and other non-wovens and disposables.

On the other hand, cordage, ropes and twines are used for oil well and gas drilling, for binding, tying and lassoing, building construction, fishing and shopping.

Cebu Pacific Air bags friendliest LCC Award

Cebu Pacific bagged the Budget Friendliest LCC Award at the Low Cost Airlines World Asia-Pacific Conference held in Singapore recently, besting other contenders Air Arabia, Air Asia, Jetstar Asia, SpiceJet and Spring Airlines.

Voted on by aviation industry professionals and LCC executives in the Asia-Pacific region, the Friendliest LCC Award recognizes the low-cost carrier with the low fares and overall great service.

“The airline has always been renowned for delivering a very Filipino brand of hospitality, and a very Cebu Pacific brand of fun. Passengers not only enjoy our trademark low fares, but also our convenient travel products, payment center options and extensive flight network,” said CEB VP for Marketing and Distribution Candice Iyog.

 

“CEB is also the only carrier offering Fun Games on board, so our guests not only reach their destinations safely and on time, but they also have fun getting there. We have heard a lot of positive feedback from first-time fliers, groups of friends and family members because of our games,” she added.

CEB also won an Anvil Award of Excellence at the 46th Anvil Awards last February 18, 2011, for the Cebu Pacific Media Backpacker’s Challenge.

“We are also very happy that our Facebook and Twitter accounts have more than 100,000 fans and followers each, surpassing other low-cost carriers in Asia. CEB encourages passengers to be a fan or follower to be the first to know Cebu Pacific’s seat sales and promos,” said Iyog.