ECCP at Work

ECCP@Work Featured Articles | October 4, 2022

October 04, 2022

ECCP Online

ECCP at Work

DTI calls for resumption of PH-EU FTA nego 

The Philippines has expressed its readiness to resume negotiations for a bilateral free trade agreement (FTA) with the European Union and the planned visit of President Ferdinand Marcos Jr. to Brussels in December this year could help advance the trade deal negotiation. Trade and Industry Assistant Secretary Allan B. Gepty conveyed the Philippine government’s sentiment for resumption of talks during a virtual dialogue with Trade Counsellor Eduardo Bryant of the Permanent Representation of Spain to the EU. “The upcoming ASEAN EU Summit and the visit of President Ferdinand Marcos Jr. in Brussels in December will be another opportunity to convey positive signals and clear policy direction,” Gepty said. In the meantime, Gepty said the DTI is waiting for EU’s decision on when to resume the bilateral FTA talks.

More foreign investments in RE projects expected

The Department of Justice (DoJ) issued a legal opinion stating that RE investments are not subject to foreign ownership restrictions, which means that the Philippines’ efforts to replace coal with renewable energy (RE) will likely get a boost. In line with this, the DoE will have to revise the implementing rules and regulations (IRR) of the Renewable Energy Act of 2008, which expressly limits foreign investment in RE to 40%.

Experts push to extend devolution transition

According to the  Department of Budget and Management (DBM) Undersecretary Wilford Will L. Wong—  ample time would be necessary to implement the transition to ensure the effective and efficient delivery of devolved functions, services, and facilities by the LGUs. In addition, National Government should improve coordination with LGUs, especially with less developed ones, through policies and programs that extend adequate technical and material assistance.

Mobility needed to sustain consumer spending – Concepcion

According to Go Negosyo Founder Joey Concepcion, the fourth quarter of 2022 will be crucial for the economy as consumer spending is expected to pick up, urging that mobility be maintained to ensure the country’s economic recovery does not stall. He stated that several external factors which threaten to weaken consumer spending were beyond the government’s control, implying that other measures have to be implemented to temper the effects and that what can be controlled would be the willingness to keep businesses active. With Christmas approaching, some industries have recently expressed hope that the Christmas season will substantially affect consumer spending, accelerating their recovery from the pandemic.

Economic growth unlikely to outpace increase in debt

WHILE the accumulation of new borrowings by the National Government has been on a decline, there is a concern that Philippine economic growth may not be able to outpace the rise in debt. The debt-to-GDP ratio stood at 62.1% as of the end of the second quarter, still above the 60% threshold prescribed by multilateral lenders and reflects the amount of debt incurred since end-2019 when the ratio stood at just 39.6%. While the government intends to bring it down to 61.8% by yearend, Mr. Mapa said that accelerating inflation, rising interest rates, and lower government spending may slow economic growth.

NG borrowings plunge 42% to P1.378T in 8-mo period 

BTr data showed that the bulk of the amount borrowed by the national government as of end-August consisted of gross domestic borrowings that reached P1.041 trillion, which was 46 percent lower than the P1.93 trillion recorded during the eight-month period of last year. The lion’s share of gross domestic borrowings during the eight-month period came from Fixed Rate Treasury Bonds at P850.382 billion, followed by Retail Treasury Bonds at P457.8 billion. There was also a net debt redemption on Treasury Bills amounting to P267.087 billion as more debts were repaid than borrowed. Data from the BTr also showed that gross foreign borrowings in the January-to-August period rose by more than a fifth to P337.794 billion from P458.509 billion recorded in the same period of last year.

Foreigners can own 100% of renewable energy projects – DOJ

In its Sept. 29 opinion, the DOJ explained that Section 2, Article XII of the 1987 Constitution—on the exploration, development and utilization of natural resources — “only covers things that are susceptible to appropriation, thus excluding the sun, the wind, and the ocean.” It said the phrase “all forces of potential energy” outlined in the Constitution should be interpreted to exclude “kinetic energy.” Renewable energy sources such as solar, wind, hydro and ocean or tidal energy are considered kinetic energy, or energy in motion, while potential energy refers to energy at rest.

PHL’s 8-rung dip in innovation index most alarming–IPOPHL

THE Intellectual Property Office of the Philippines (IPOPHL) has described as “most alarming” the Philippines’s slide of eight notches in the 2022 Global Innovation Index (GII). According to the GII 2022 report from the United Nations’ World Intellectual Property Organization (WIPO), the country scored 30.7— a decline from last year’s 35.3. Despite this, the IPOPHL sees a “bright spot” in IP-related driving indicators.

Sangley airport construction may start by Q3 next year 

THE CAVITE provincial government expects construction of the $11-billion Sangley Point International Airport Project, which will serve as an alternative to the Ninoy Aquino International Airport (NAIA), to start as early as the third quarter of 2023. Construction work on the airport project will begin in “third-fourth (Q3-Q4) quarter 2023,” Cavite Governor Juanito Victor “Jonvic” C. Remulla said. The provincial government awarded the project on Sept. 14 to a consortium composed of Philippine, European, and South Korean companies. The signing of the joint venture and development agreement is expected to take place this month. The parties will work on finalizing the airport’s design and business plan, the provincial government said.

EVAP seeks more loan access to support local EV production 

LOCAL electric vehicle (EV) manufacturers are asking for more access to financing and loans in order to boost production. Electric Vehicle Association of the Philippines (EVAP) President Edmund A. Araga said that some banks are still reluctant to approve loans for local EV manufacturers. This is hampering the growth of the industry. He added that commercial banks and other financial institutions need to be more “open-minded” in terms of approving loans since there are already established policies on registration, proper documentation, regulation, and standards.

PHL grid lags ASEAN in accommodating variable RE power sources 

THE Philippine grid is not as able as its counterparts among the major economies of the Association of Southeast Asian Nations (ASEAN) to accommodate a large proportion of variable renewable energy (RE), according to the Southeast Asia Information Platform for the Energy Transition (SIPET). According to the Department of Energy (DoE), system flexibility will be a factor in making variable RE cost-effective.

NEDA: POGO closures won’t stall recovery

If the government decides to ban Philippine Offshore Gaming Operators (POGOs) in the country, the economy has enough strength to sustain its recovery in the coming years, according to the National Economic and Development Authority (Neda). At the sidelines of the joint National Statistics Month (NSM) and National Convention on Statistics (NCS) opening ceremonies on Monday, Neda Undersecretary Rosemarie G. Edillon told reporters that while the exact contribution of POGOs to the economy still needs to be estimated, there are signs that the recovery in several sectors of the economy is expected to take up the slack.

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