NEWS IN BRIEF
P/$ rate closed at P54.590 to $1
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The peso rate closed at P54.590 to the US dollar last Friday at the Philippine Dealing System of the Bankers Association of the Philippines. The weighted average rate stands at P54.477.
Peso seen lower than P 55/$1
The Bangko Sentral ng Pilipinas, which is assuming a 2005 and 2006 foreign exchange rate of R55.57:$1, said the local currency could end lower or close to P55 by end-December. BSP Deputy Governor Diwa C. Guinigundo said the scenario "looks good" and assumptions are improving. "The peso is expected to be lower than R55 by the end of the year," he said. The local currency has been appreciating from R56.30:$1 from late September to R55.60. According to Banco de Oro currency expert Jonathan Ravelas, chart-wise the week’s close at P54.42 continues to imply further peso strength towards the P54-P54.20 levels. "However, given the market’s oversold condition, a near-term bounce towards the 54.80-54.90 levels could occur," he added. The peso is expected to remain strong on the back of the large flows from overseas Filipino workers as well as portfolio flows, which go to the equity markets. The local currency rose anew by 0.31 percent week-on-week to R54.59 after the government reported that its budget deficit in October was lower that expected. It also announced that they would raise the value added tax rate to 12 percent on February 1 next year from 10 percent.
KPMI registers new project
The Board of Investments (BoI) recently awarded the Certificate of Registration to Keppel Philippines Marine, Inc. (KPMI) for its new project involving the proposed installation of a complete panel line system, a block assembly facility together with heavy construction equipment in Keppel Batangas Shipyard for its new shipbuilding activities. KPMI will produce tugboats, general cargo vessels, and oil rig hulls for the export market. The project is in line with the firm’s strategic thrust towards a proactive role in the growing shipbuilding market and is listed under the 2005 Investments Priorities Plan’s shipbuilding activity. Granted pioneer status in view of the magnitude of its investment ( R574 million), the project is entitled to income tax holiday for 6 years, exemption from taxes and duties on imported spare parts, exemption from wharfage dues and export tax and other incentives. KPMI is 54 percent Filipino and 46 percent foreignowned. The project is expected to commence commercial operations in January 2006 and will generate 1,602 new jobs at full capacity.
Palawan gets livelihood grant
Asian Development Bank (ADB) has extended a $240,000 grant to Puerto Princesa City to provide alternative livelihoods to tricycle operators and help cut down on pollution. The grant is extended through the Poverty and Environment Program (PEP), which will pilot test a number of strategies, as well as livelihood support activities among tricycle drivers to tackle environmental and the underlying social issues surrounding tricycles in the city. Taking a participatory approach, the project will strengthen the technical and entrepreneurial knowledge base of tricycle operators and drivers and establish a fund for drivers to upgrade the efficiency of their tricycle engines. It will also help enhance the city government’s enforcement of its Clean Air Act, especially for roadside emission monitoring and catching smoke belchers. The lessons learned from the project will assist in the formulation and replication of the strategies in other cities in the Philippines.
ADB lends to Indonesia
The Asian Development Bank (ADB) said yesterday it would extend $330 million in loans to Indonesia to improve the decentralization process in that country. This in turn will help improve the delivery of basic services at the local government level, the ADB said in a statement from its headquarters in Manila. A loan of $300 million will go to "strengthen and rationalize the policy, legal, and regulatory framework for decentralization, and establish a more effective mechanism for intergovernmental coordination," the ADB said.
IATA accredits PeopleSupport
PeopleSupport (Philippines) Inc., an offshore business process outsourcing (BPO) provider that offers customer management and accounts receivable management services for US-based clients from its facilities in the Philippines, recently received its accreditation from the International Air Transport Association (IATA). The accreditation makes PeopleSupport the first BPO provider in the Philippines to be accredited with the IATA and makes the company a true travel expert. "We are very honored to be accredited by the IATA as this will surely benefit all our employees and their families," said Bong Borja, President of PeopleSupport Philippines. "This is a recognition of our contribution to the tourism industry." IATA was founded in Havana, Cuba in April 1945 and is the prime vehicle for inter-airline cooperation in promoting safe, reliable, secure and economical air services for the benefit of the world’s consumers.
With IATA accreditation, PeopleSupport is now an internationallyrecognized travel expert and is authorized to sell and issue international and domestic airline tickets at discounted prices to qualified employees and their dependents
Tuna quality testing lab eyed
The Bureau of Fisheries and Aquatic Resources (BFAR) is allocating R3.5 million for the construction of a laboratory for the quality testing of tuna. BFAR Director Malcolm Sarmiento said the fund for the laboratory, which will be put up at General Santos port, will come from the Philippine Fisheries Development Authority (PFDA), a government owned ad controlled corporation tasked to promote the development of the fishing industry. BFAR is focused in upgrading its port and processing facilities for tuna export at par with international food safety standards, he stressed. Recently, Sarmiento signed a memorandum of agreement with Dole Philippines for the temporary use of the latter’s laboratory by tuna producers for a minimum fee. To be able to participate in the world market, he said Philippine products such as tuna must meet the strict quality standards of countries like Europe, Japan and the United States. The EU wants to raise by 2006 the allowable maximum lead content on fish to a higher 0.02 parts per million (PPM) from the present 0.05 PPM. "We have to follow what modern-day dictates and improve our facilities for food safety," Sarmiento said. Aside from putting up of a laboratory, he said BFAR is also conducting the upgrading of port facilities in General Santos to keep up with Europe. Among the usual cold storage requirement in Europe is the use of all stainless steel facilities.
Filipinos should not panic and stockpile Tamiflu amid fears that the deadly human strain of avian influenza could infect the Philippines, a World Health Organization official said yesterday. WHO country representative Jean Marc Olive said Tamiflu was not a "dream drug" that can cure bird flu in humans but was rather a preventive drug. "Tamiflu for the moment is not necessary in the Philippines because there is no infection in human nor infection" in birds, Olive said. "We don’t know which virus will come out, so don’t focus too much on Tamiflu," Olive told reporters. Manufactured by Swiss drug maker Roche, Tamiflu eases the symptoms of flu in an infected person by inhibiting reproduction of the influenza virus. The Philippines, whose large forest cover and swamplands attract migratory birds from China, remains free of bird flu and the H5N1 strain lethal to humans that has killed over 60 people in the region since 2003. Local health authorities have warned that it is only a matter of time before the disease strikes the Philippines. Luningning Villa, an expert at the health department, said the government is discouraging people from stocking up on retroviral drugs, including Tamiflu. But she said the government may be purchasing enough "just in case there is a pandemic." (AFP)
The Bangko Sentral ng Pilipinas is now evaluating cases against banks accused of mismanagement and violation of BSP rules, among other complaints. BSP Deputy Governor Nestor A. Espenilla Jr. said these cases will be arbitrated by the central bank’s in-house hearing panel, currently being set up on the ninth floor of the BSP Building in Malate, Manila. "(The panel) will hear complaints against banks after the MB (Monetary Board) has reviewed it," Espenilla said. "The MB will also deliberate on any appeals or reconsideration." BSP Circular No. 477 Series of 2005 is the basis for these procedures since it contain the rules on administrative cases involving directors and officers of banks, quasi-banks and trust entities. The complaints will be referred to the BSP Office of Special Investigation. In the meantime the entire proceedings will be conducted without necessarily adhering to the technical rules of judicial trials, the circular said. The panel will arbitrate cases faster than local courts normally do which is about ninety days. BSP Assistant Governor and General Counsel Juan de Zuniga said there are at least three cases under OSI review, at the moment. "The hearing panel will recommend these to the MB either for dismissal or filing of a case," he said.
Selected products, technology and equipment from the United States will be featured at the U.S. Pavillion and U.S. Catalog Show at the 8th ASEAN Council on Petroleum (ASCOPE) from November 30 to December 3, 2005 at the Philippine International Convention Center (PICC). ASCOPE is widely regarded as one of the most important oil and gas events in the Asia Pacific region, as it brings together key players in the oil and gas industry. Serving as an excellent platform to showcase state of the art technologies, products and services in the upstream, downstream and petrochemical sectors. ASCOPE attracts a prestigious audience including multinational and national oil companies, government officials, traders, suppliers, consumers and industry experts working in Asia Pacific. Held every four years, ASCOPE is organized by the state-owned oil and gas companies from member countries of the Association of Southeast Asian Nations (ASEAN) which includes the Philippines, Brunei, Thailand, Malaysia, Vietnam, Indonesia, Myanmar, Singapore, and Cambodia. This year, the Philippine National Oil Company (PNOC) is hosting this milestone event. ASCOPE is a certified trade show of the U.S. Department of Commerce.
FLI sets P 1.2 B for capex
Filinvest Land Inc., a property concern, yesterday said it plans to set aside P1.2 billion for capital expenditure in 2006, more or less in line with its allocation for this year. In a disclosure to the stock exchange, the company said the amount, which is still a rough estimate, will be used to finance land development and construction projects. Filinvest Land President Joseph Yap said funds to support next year’s planned capital spending will be internally generated. Early this year, the company said it was looking to allocate between P1 billion and P1.2 billion for capital spending in 2005. Filinvest Land in August posted lower second-quarter earnings after a decline in real estate sales in the period, despite a stronger showing in the first quarter. The company said net profit in the three months to June fell 20 percent on year to P141.9 million from P176.3 million, as real estate sales decreased 24 percent on year to P485.2 million from P641.4 million. Filinvest Land’s second-quarter performance dragged first-half net profit down 3.2 percent on year to P272.4 million from P281.4 million, even as real estate sales for the January-June period improved 15 percent on year to P1.16 billion from P1.01 billion.
ASB Holdings bares new project
ASB Holdings, Inc. is eyeing robust revenues from its newly launched project St. Francis Square, a bargain mall located in between Henry Sy’s SM Megamall and The Podium at the Ortigas Commercial Center. Edgardo Tenedero, Senior Vice President for Operations of St. Francis Square said the new commercial center is now leased by 950 tenants and will be at full capacity by next month. St. Francis Square has a total leasable space of 18,000 square meters and can accommodate up to 1,300 tenants. Depending on the performance of St. Francis Square, Tenedoro said ASB Realty may also consider putting up more bargain malls in the future. " We hope this(St. Francis Square) becomes a buy word in such a short time," Tenedoro said. The construction of St. Francis Square bargain mall has the prior approval of the Rehabilitation Receiver of ASB Holdings. ASB filed for rehab in the late 90’s due to financial troubles. Meantime in a recent development, ASB Holdings through its subsidiary ASB Realty Corp. entered into a joint venture agreement with Sta. Lucia Realty and Development Inc. for the development of a property in Sto. Tomas, Batangas. ASB Realty, together with Sto. Tomas Agri Farms Inc. (Stafi) and Novoland Development Corp., entered into an agreement with Sta. Lucia to develop a 55-hectare property in Batangas into residential and commercial subdivision. The joint venture has already been approved by the Securities and Exchange Commission. The approval, however, was subject to the condition that ASB Realty will use its earnings from the joint venture to pay its more than 700 unsecured creditors. ASB Realty expects to generate P100 million in earnings from the agreement, which will go to the asset pool of the ASB Group to settle its obligations.
ISP provider has new service
i-Manila, the first ISO-certified Internet Service Provider (ISP) in the country, recently launched iManilaOne, a personal mobile Internet service that offers premium postpaid plan at a prepaid price. The new service offers up to 20 hours of Internet connection for only P200.00 a month and charges P8.00 an hour in excess of the maximum usage, announced i-Manila President Robert Deluria. "We launched i-ManilaOne in response to the need of practical users wanting to manage their Internet expenses," he explained. "What makes i-ManilaOne the right choice for postpaid Internet users are the simple and inexpensive rates, making it ideal for those who want premium Internet service without the hassles of complicated billing schemes and high rates," the President stressed. i-ManilaOne has one email address and is backed by i-Manila’s highly reliable Internet gateway and competent 24/7 customer support. The service now offers free access from 1:00 AM to 6:00 AM daily.( EVA)
Pancake raises $4 M in notes issue
Pancake House Inc said it raised $4 million by issuing five-year convertible notes, which it used to finance the acquisition of a 70 percent equity interest in restaurant chain Teriyaki Boy. In a statement to the stock exchange, Pancake House said the acquisition deal was closed Friday. The notes are convertible at any time, at the option of the investors, to 49.16 million common shares representing 20.6728 percent of the company’s enlarged capital. Conversion price is P4.4850 a share. Pancake House issued the notes to Aureos Southeast Asia Fund LLC, Planters Bank Venture Capital Corp for SMEs, Pancake House Holdings Inc, and Pancake House shareholder Martin Lorenzo. Pancake House was untraded today after closing at P2.60 last Friday.
Petron complies with BoI rules
Petron Corp. said it has complied with Board of Investment requirements that would entitle the company’s more than P9 billion worth of petrochemical projects to tax incentives and other perks. Earlier, the BoI approved Petron’s application as a new export producer of benzene, toluene and mixed xylene and as a new domestic producer of propylene. The approval was subject to certain terms and conditions, which Petron said it has already complied with. Incentives Petron would be entitled to include income tax holidays and lower duties on imported capital equipment, the company said in a statement. "Our entry into petrochemicals supports our strategy of investing in higher margin businesses which will increase our presence in the regional market," Petron president and chief executive officer Khalid Al-Faddagh said. "Our focus in the next five to 10 years is to develop our refinery assets to capture the unique opportunities presented by developments in the petrochemical industry. Petrochemical demand is projected to grow at an annual pace of 5 percent between 2005 to 2015, and command better regional and local prices than petroleum products, the company said. In the six months to June, Petron’s export sales contributed nearly a third of its P2.31 billion net profit, the bulk of which came from exports of mixed xylene.
PAL starts Beijing flight on Nov. 11
Philippine Airlines (PAL) said it will start regular flights from Manila to Beijing on Nov 11, returning to the Chinese capital after a 16-year hiatus. In a statement, PAL said it will fly to Beijing and back three times a week and will use Airbus A330-300 aircraft for the first two flights, on Nov 11 and 13, to accommodate the expected number of passengers. It will soon after switch to Airbus A320s, which seat 150 passengers. PAL flew to Beijing from 1979 to 1989, when services were suspended for commercial reasons. PAL said Beijing provides a bigger platform from which to access a growing tourism market. Beijing will be the Philippine carrier’s third destination in China. It already flies to Xiamen and Shanghai.
The Fair Trade Alliance (FTA) has commended the endorsement made by the Bureau of Customs for the filing of charges against cement importer, Southern Cross Cement Corp. (SCCC). In a statement, Dr. Rene Ofreneo of the FTA commended the BoC action. In particular, Ofreneo commended BOC Commissioner Alexander M. Arevalo for the endorsement made by the Customs Intelligence and Investigation Service (CIIS). The CIIS has recommended for the filing of criminal charges against SCCC for alleged illegal release of its cement imports, falsification of public documents and making misrepresentations. The FTA said the BOC move will promotestanding crusade against harmful imports and unfair trade practices. This will also promote a level-playing field and strengthen our resolve to nurture our local industries and agriculture, Ofreneo said.
To date, the International Container Terminal Services, Inc. (ICTSI) has invested USD$65 million on its Suape Container Terminal (SCT) in Pernambuco, Brazil and is on track in its goal to make the port achieve hub status. Recently, ICTSI spent some USD$17 million to acquire new container handling equipment and improve the terminal’s infrastructure. Subsidiary Tecon Suape, S.A. (TSSA), manager and operator of the SCT bought two new postPanamax quay cranes (QCs) and two rubber tired gantries (RTGs) manufactured by Shanghai Zhenhua Port Machinery Co. of China. In addition, the company constructed a 30,000-square meter storage area. In all, TSSA has invested USD$65 million since 2001 when it started operating the SCT. Key areas of the investments were infrastructure, equipment, information technology and manpower development. "We are commissioning new container handling equipment at the SCT to better accommodate the surging volumes in the terminal," announced Enrique K. Razon Jr., ICTSI chairman and president. "Our export boxes were up to 20 percent in August compared to the same period last year. Before the end of the year, we are expecting to handle 185,000 TEUs, a 35 percent increase from 2004," he elaborated. "We are also preparing the SCT to be the next hub port not only in Brazil but in the South Atlantic," added Sergio Kano, TSSA chief operating officer. The equipment will be operational in mid-November, making SCT the most modern in Brazil. Even now, "The terminal is fast becoming a hub for the region’s EuropeanLatin American trade," he
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