World Bank warns of global economic slowdown

WB logoThe World Bank (WB) has warned of a global economic slowdown in 2019 as it revised a downward projection growth of 2.9 percent this year from 3 percent in 2018.

“International trade and manufacturing activity have softened, trade tensions remain elevated, and some large emerging markets have experienced substantial financial market pressures,” said the World Bank.

WB expects growth among advanced economies to drop to 2 percent this year with a slowing external demand, rising borrowing costs, and persistent policy uncertainties that would weigh on the outlook for emerging market and developing economies. “Growth is anticipated to hold steady at a weaker-than-expected 4.2 percent this year.”

WB noted that the upswing in commodity exporters has stagnated, while activity in commodity importers is decelerating.

“Per capita growth will be insufficient to narrow the income gap with advanced economies in about 35 percent of emerging market and developing economies in 2019, with the share increasing to 60 percent in countries affected by fragility, conflict, and violence.”

“A number of developments could act as a further brake on activity. A sharper tightening in borrowing costs could depress capital inflows and lead to slower growth in many emerging market and developing economies.”

“Past increases in public and private debt could heighten vulnerability to swings in financing conditions and market sentiment. Intensifying trade tensions could result in weaker global growth and disrupt globally interconnected value chains.”

“Robust economic growth is essential to reducing poverty and boosting shared prosperity,” said World Bank Group Vice President for Equitable Growth, Finance and Institutions, Ceyla Pazarbasioglu.

“As the outlook for the global economy has darkened, strengthening contingency planning, facilitating trade, and improving access to finance will be crucial to navigate current uncertainties and invigorate growth,” said WB.

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PAL resumes direct service to New Delhi

PAL A320

Philippine Airlines (PAL) has resumed its direct service to New Delhi, India after it stopped operating six years ago.

PAL president and COO Jaime Bautista says the long-heralded return of PAL to the Indian market will provide a welcome boost to the tourism industries of both the Philippines and India.

The airline previously flew the Manila – Delhi route from 2011 to 2013, with most flights making costly stopovers in Bangkok due to the limited range of the Airbus A320 aircraft then in use. PAL also served Kolkata (Calcutta) as a key stopover point on the flag carrier’s multi-stop Manila-Europe services in the 1950s.

PAL is targeting April 2019 as the start of the New Delhi service subject to final slot and operational clearances with the Indian authorities. The new route is slated to run four times weekly nonstop between Manila and New Delhi’s Indira Gandhi International Airport using brand-new Airbus A321neo aircraft.

Bautista stressed that India is the air travel growth market of the future and a new economic power, so our link to Delhi improves the Philippines’ connectivity with the global economy.

“We are enthusiastic about our new Delhi route because, for the first time, we have the right-sized aircraft for the Indian market. Our Airbus A321neo’s long-range capability makes direct nonstop flights possible, and this new plane features 168 seats configured specially for long-haul travel, making the 6 hour and 50 minutes Manila-Delhi flight more comfortable and pleasant.”

The A321neo also offers passengers full-flat business class seats, generous legroom and the latest in entertainment systems and Wi-Fi connectivity.  The aircraft is also flying nonstop to Sydney, Brisbane, Port Moresby and Sapporo. For Hanoi and Phnom Penh, PAL will utilize a 156-seater Airbus A320 and a 199-seater Airbus A321 Classic.

To serve the strategic goal of strengthening the Philippines as a network hub, PAL is also increasing the number of weekly flights to certain destinations during the Summer 2019 travel season, as follows:

Cebu to Nagoya: from 4 weekly to daily flights Manila to Osaka (nonstop): from 7 to 11 weekly flights Manila to Bangkok: from 21 to 25 weekly flights Manila to Kuala Lumpur: from 7 to 11 weekly flights Manila to Jakarta: from 7 to 10 weekly flights Manila to Los Angeles: from 14 to 17 times weekly Manila to San Francisco: from 10 to 14 times weekly Manila to New York JFK: from 5 weekly to daily flights Manila to Toronto: from 5 weekly to daily flights Manila to Sydney: from 7 to 9 weekly flights Manila to Brisbane: from 4 to 5 weekly flights Manila to Taipei: from 10 to 14 weekly flights Manila to Doha: from 4 to 5 weekly flights

The expansion marks the first time an airline will offer more than four daily flights linking Manila with the U.S. West Coast along with daily services on ultra-long-range routes to both New York and Toronto on the US/Canadian East Coast.

PAL’s Manila-New York non-stops are the longest commercial route operated by any airline to New York’s JFK Airport, and the eighth longest commercial airline route in the world.

PAL says the expanded flight frequencies would give passengers the increased flexibility to choose from a wider array of flight departure and arrival times for greater convenience. Travellers will also be able to connect more easily across the airline’s international and domestic route network, thus supporting the Philippines’ position as an aviation hub.

PAL will continue to deploy its full fleet of brand-new high-technology aircraft, including the long-range Airbus A350-900, the mid-range A321neo and the tri-class A330 airliners as passengers can experience the 4-Star branded service that won accolades for the flag carrier in recent months, including the recent honor for the World’s Most Improved Airline for 2019 according to AirlineRatings.com.

 

PAL adds new routes to Asian network

PAL 1st A350-900 June 7, 2018

Philippine flag carrier Philippine Airlines (PAL) has expanded its Asian network with the opening of new routes to Hanoi in Vietnam), Phnom Penh in Cambodia and New Delhi, India from its Manila hub starting this summer season.

Pal president and COO Jaime Bautista says this latest expansion by the award-winning flag carrier creates the first direct air link between the Philippines and the capital of Cambodia, expands PAL’s existing Vietnam network and re-establishes a historic link to India with immense potential for tourism development.

“Philippine Airlines’ strategic vision is to make the Philippines a true gateway to Asia.   We are the Southeast Asian airline with the biggest and most extensive network of direct flights to the US and Canada, and thus we can be the leader in carrying North American travellers to India, Cambodia and Vietnam via our Manila hub,” says Bautista.

“We will leverage Manila’s excellent geographical location as an ideal stopover point for people flying to Southeast and South Asia from the East and West Coasts of North America.”

PAL currently operates 43 weekly flights nonstop from six North American destinations – New York, Los Angeles, Toronto, San Francisco, Honolulu and Vancouver. This comprehensive network, flown by PAL’s latest-technology Boeing 777, Airbus A350 and Airbus A330 aircraft, will generate passenger travel flows into Hanoi, Delhi, Phnom Penh and other destinations in the ASEAN region and beyond.  PAL additionally operates seven weekly flights from the U.S. territory of Guam.

“Vietnam and Cambodia are emerging markets and economic centers that need connections to the rest of the world. We are excited to introduce their excellent tourist attractions to more and more Western travelers, including Filipino Americans,” says Bautista.

“PAL also looks forward to serving the many ethnic Vietnamese and Cambodian people who are now US and Canadian citizens.”

As the Vietnamese capital, Hanoi offers a harmonious fusion of East and West, combining Vietnamese and French cultures reflected in its heritage architecture and world-renowned cuisine. Vietnam has posted among the highest economic growth records in Southeast Asia, fuelling an increase in overseas travel by its own citizens.

Phnom Penh is an emerging tourist mecca noted for its vibrant street life, arts scene, museums and historical Khmer architecture, including its famed Royal Palace. The capital city’s newly expanded airport serves as a gateway to Siem Reap, Sihanoukville and other popular destinations in the Kingdom of Cambodia.

Flights between Manila and Hanoi will operate four times weekly -(Monday/Wednesday/Friday/ Sunday) starting March 31, 2019 with PR 595 departing at 10:25 PM and arriving at Hanoi’s Noi Bai International Airport at 12:45AM the following day. Return flights via PR 596 leave Hanoi every Monday, Tuesday, Thursday and Saturday at 1:45 AM and touch down in Manila at 5:30 AM.

Flights between Manila and Phnom Penh will operate five times weekly -(Monday/Tuesday/Thursday/ Friday/Saturday) starting April 1, 2019 with PR 521 departing at 10:10PM and arriving at Phnom Penh International Airport at 11:45 PM. Return flights via PR 522 leave Phnom Penh every Tuesday, Wednesday, Friday, Saturday and Sunday at 12:45 AM and back to Manila at 4:20 AM.

PAL will maintain its current 8 weekly flights between Manila and Vietnam’s commercial hub, Ho Chi Minh City (Saigon), a city served by the flag carrier since the mid-1980s.

 

IATA unveils new online payment option

iata downloadPurchasing airline ticket direct from the airline’s website will soon become more convenient, highly secure and almost instantaneous following the successful live test conducted by the International Air Transport Association (IATA) in partnership with ipagoo, a UK-based fintech company.

The live test conducted with ipagoo was done under the UK’s Open Banking framework with IATA Pay pilot airlines, including Cathay Pacific Airways, Scandinavian Airlines and Emirates.

IATA Pay is an industry-supported initiative to develop a new payment option for consumers when purchasing a ticket directly from an airline website. It is made possible by the European Commission’s second Payment Services Directive (PSD2), and the UK’s Open Banking regulation.

IATA says these regulations encourage the use of direct debit transactions in which payments are made from the customer’s bank account directly into the bank account of the merchant. This method offers an extremely high level of security to both user and recipient and can be instantaneous.

IATA’s role is to develop an industry solution enabling airlines to make this payment option available on their websites.

For airlines, the advantages of IATA Pay are cheaper payment option compared to other alternatives, highly secure, faster cash flow with instant or near instant payment to the merchant and simpler payment process resulting in fewer lost sales.

For consumers, the benefits include access to a new, simpler method of payment that is highly secure.

“Today’s consumers, and especially millennials, have expectations of multiple payment options including mobile and peer-to-peer. IATA Pay responds to these expectations. At the same time, airlines are trying to manage significant card payment costs — $8 billion per year and rising,” said Aleksander Popovich, IATA’s Senior Vice President of Financial and Distribution Services.

“A large part of this cost is incurred in direct purchases from airline websites. One of IATA’s strategic objectives is to support airlines’ financial sustainability including controlling costs.”

Carlos Sanchez, CEO, ipagoo said: “We are delighted to have completed the first Open Banking live transaction for the airline industry, helping IATA and its member airlines to achieve their goals of operational and financial efficiency. ipagoo’s technology provides a secure, multi-country banking service for IATA.”

“We are at the forefront of development and innovation within the financial industry and committed to helping businesses and their clients take advantage of the opportunities provided by Open Banking.”

 

IATA is also working with Deutsche Bank on a prototype for Europe, excluding the UK, starting with the German market, which is expected to undergo testing in early 2019.

Boracay rehabilitation requires US$478 million investment

The rehabilitation program of the world-renown Boracay Island in Central Visayas would require an investment of P25 billion (US$478 million) under the medium-term Boracay Action Plan (BAP).

The Boracay Inter-Agency Task Force adopted the action plan that laid out the proposed programs for the island’s rehabilitation.

The BAP will install safeguards from ecological degradation and sustain tourism activities in Boracay.

“The action plan provides the strategic interventions to ensure the island’s rehabilitation over the medium term and sustainable management over the long term,” says National Economic and Development Authority (NEDA) Undersecretary Adoracion Navarro.

“The plan embodies the stakeholders’ vision of a secure and globally-competitive world-class tourism destination with a vibrant, productive and climate-resilient economy that is geared toward inclusive growth and anchored on the sustainable development of its innate natural resources.”

The plan has four thematic areas — enforcement of laws and regulations, pollution control and prevention, rehabilitation and recovery of the ecosystem, and sustainability of island activities.

Navarro says 64 percent of the total investment will be allotted for infrastructure with private sector financing of 62.9 percent of the total cost.

The inter-agency task force led by the Department of Environment and Natural Resources (DENR) is tasked to formulate an action plan that serves as a guide for Boracay Island’s rehabilitation.

NEDA has organized several regional and national level meetings to ensure that key interventions from both government and private organizations are incorporated into the action plan which will be implemented over the next four years.

 

Bohol’s Tubigon Seaport in central Visayas reopens to shipping traffic

The Philippine Department of Transportation (DOTr) announces the reopening of Tubigon Seaport in Bohol, central Visayas on Saturday after five years following the destructive earthquake of magnitude 7.2 that hit the island.

The renovated Port of Tubigon has an expanded capacity to accommodate up to 28 ships including larger vessels, nearly thrice its previous capacity of 10 ships. It now boasts of three Ro-Ro wharfs for docking landing craft tanks (LCTs) and barges.

The air-conditioned passenger terminal building can now accommodate around 4,000 passengers daily, a substantial increase from its previous 1,500-passenger capacity. It also offers a child care station facility and enhanced security facilities including a baggage X-ray machine and a walk-thru metal detector.

The rehabilitation project undertaken by the Department of Transportation (DOTr) also includes the establishment of a one-stop shop for a more convenient clearing and payment of port charges, the repair of the pedestrian covered walkway, lighting system, security fence and gate and improvement on the port access road.

The Tubigon Port serves as a primary dock to vessels plying the Tubigon-Cebu City route. It is also the best option for travellers from Bohol going to Cebu and vice versa because of the short travel time, numerous transport schedule, cheap fares and availability of public vehicles that ply the routes to any point in Bohol.

The rehabilitation of the Tubigon Port forms part of the government’s infrastructure plan to further develop Bohol’s economy, which was severely affected by the devastating quake that left hundreds dead and billions of pesos worth in damages.

 

Philippine inflation rate hikes to 5.2% in 2018

2018 ended with a much higher Philippine inflation rate of 5.2 percent compared to the 2017 level of 2.9 percent.

The National Economic and Development Authority (NEDA) justified the higher inflation rate, stressing that it is within the adjusted inflation forecast of the Development Budget Coordination Committee.

The inflation rate in December 2018 slowed down to a seven-month low at 5.1 percent down from November’s 6 percent, signifying that the mitigating measures already in force are broadly effective, says NEDA

NEDA believes that the rate of price increases has remained manageable, giving the country adequate elbow room to sustain its economic growth and reach its development goals.

“We understand that the faster inflation particularly in the middle of 2018 had affected many Filipinos, most especially those in the disadvantaged sectors. In response, the economic team took swift and decisive measures to tame inflation as directed by the President.”

Inflation in Metro Manila decelerated for the fourth consecutive month to 4.8 percent in December 2018 from 5.6 percent in November. The rest of the regions felt slower inflation rates in December 2018 compared to the previous month.

NEDA pledged that it will continue to exert all efforts to bring inflation within the government’s target range of 2 to 4 percent and ensure price stability all year round.

With the expected signing into law of the Rice Tariffication Bill, NEDA expects rice prices to drop by PhP7.00 per kilo. “We recognize, however, that this favorable effect can only be sustained if there are more players in the rice market, starting from production and financing to post harvest and trading,” says NEDA

NEDA pointed out that the government would step up its anti-smuggling measures, aiming that only duly-taxed imports enter the country.

“We also need the Philippine Competition Commission to be vigilant in curbing anti-competitive behavior, particularly in the rice market.”

NEDA also urged the Department of Agriculture to hasten the issuance of the Fisheries Administrative Order No. 259 to compensate for the limited supply as some parts in the Visayas are under closed fishing season.

PAL acquires 6th new Airbus A321neo

PAL new A321 neo

The Philippine Airlines (PAL) has acquired its sixth brand new Airbus A321neo which arrived on New Year’s Day from the Airbus complex in Finkenwerder, Germany.

Photo shows the delivery crew upon arrival in Manila – from left, Ian Echavez (Civil Aviation Authority of the Phils.), John Cumigad (CAAP), Dolly Gabriel (PAL Corp. Finance), Capt. Rene Atilano, First Officer Dan Lat (behind), First Officer Justin Isaac (front), Capt. Barney Charles Ramos Guevarra (A321 deputy chief pilot), Rhodell Agustin (Lufthansa Technik Phils.), Mark Arpon (behind, LTP) and Quin Catabui (aircraft engineering & team head).