3 FOREIGN FIRMS KEEN ON HANJIN’S ASSETS
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THE Hanjin shipyard is seen from across Redondo Bay in this BusinessMirror’s February 2019 photo.
DEPT. OF SCIENCE AND TECHNOLOGY
PHILIPPINE STATISTICS AUTHORITY
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HREE foreign investors are in the advanced stages of acquiring the country’s largest shipyard, operated by bankrupt Hanjin Heavy Industries and Construction Philippines (HHIC-Phil), and no Chinese firm is on the list. Trade Undersecretary Ceferino S. Rodolfo disclosed three offshore shipbuilders vowed to come up with studies and a business proposal in a shot to take over Hanjin’s facilities in Subic Bay. However, none of these three prospective white knights come from China, in spite of the government’s earlier statement that two Chinese firms are looking to bail Hanjin out of its financial mess. “Those who committed that they will come up with studies, with a business pro-
NONIE REYES
HOWEVER, security experts, including former Navy Chief Alexander P. Pama, warned the government it will compromise national security should it allow China to take over the shipbuilder’s facilities in Subic Bay. The shipyard sits at a strategic area near West Philippine Sea, where Beijing has been building up military presence and harassing Filipino fishermen. Pama argued the shipyard can be turned into a naval base and a maritime facility, making it a crucial asset for the Philippines that the government should take care of. “The ownership of Hanjin shipyard in Subic Bay will give the owners unlimited See “Hanjin’s assets,” A2
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A broader look at today’s business n Tuesday, April 23, 2019 Vol. 14 No. 195
PHL current account gap seen narrowing T By Bianca Cuaresma
@BcuaresmaBM
HE country’s current account balance is projected to improve in the coming years, but it will still be in deficit up until 2024, according to data from the International Monetary Fund (IMF).
In the IMF’s assessment of the world economy as published in the April 2019 World Economic Outlook, the global monetary authority forecast a downtrend in the country’s current-account deficit from last year’s level. From a deficit equivalent to 2.6
percent of GDP in 2018, the IMF projected that the country’s current account would fall to 2.2 percent of GDP this year. For next year, the IMF projects the country’s current-account deficit to hit 1.8 percent of the country’s GDP.
An economy’s current account is the largest and most consistent part of its balance of payments (BOP). The Philippines has incurred a deficit in recent quarters after years of being in the surplus territory due to the rise in its importation bill following the government’s drive
2.2% of GDP The Philippines’s projected current-account deficit this year to ramp up construction and infrastructure in the country. In its report on the BOP balance, the Bangko Sentral ng Pilipinas (BSP) confirmed that the larger current-account deficit in 2018 developed as the widening deficit in the trade-in-goods account more than offset the higher net receipts posted in the trade-in-services, and primary and secondary income accounts. The IMF said the currentaccount deficit as a percentage of the country’s GDP is expected to hit 1.4 percent by 2024. See “Current account,” A3
‘Best time’ to invest in PHL– DOF chief @ReaCuBM
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HE Department of Finance (DOF) has invited the American business community to invest in the Philippines during its “best time,” as the country’s prospects for faster economic growth in the coming years should be an avenue for stronger collaboration with the United States, especially with the private sector. Finance Secretary Carlos G. Dominguez III told leaders of the American business community during a roundtable luncheon
SHAKEN Traffic stands still and people fill Ayala Avenue, the main thoroughfare of Makati’s Central Business District, minutes after a 6.1 magnitude earthquake hit parts of Luzon and Metro Manila late Monday afternoon, killing at least five people, damaging public and private infrastructure and halting train operations. Story and more photos on page A12. NONIE REYES
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Why not penalize political turncoats? Manny F. Dooc
TELLTALES
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HREE babies are born every minute in the Philippines, according to the Population Commission. Our population has been growing steadily over the years. While the birth rate at 1.72 percent has decreased compared to previous decades, it’s still one of the highest in the world. We are now the 13th most populous country and based on official estimates, our population will hit 108.11 million in 2019. Overall, factoring the births, deaths and migration, we have a net gain of one person every 20 seconds, or three persons every minute. Continued on A11
Did power firms collude in outages? PCC probing By Elijah Felice E. Rosales
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By Rea Cu
See “DOF chief,” A9
Security concerns
posal—and of course, they have to give this to the banks because they control Hanjin’s assets—are [Dutch] Damen Group, [French] Naval Group and a consortium of American firms,” Rodolfo said in an interview with reporters last week. HHIC-Phil in January filed for corporate rehabilitation, after struggling to pay $412 million in loans to five domestic banks. Investment officials are searching far and wide to try and save the shipyard that once employed over 30,000 workers. Days after HHIC-Phil sought help from the courts, Rodolfo told reporters two Chinese firms—one in the production of commercial vessels, the other in small ships—are eyeing the shipyard.
@alyasjah
HE country’s competition regulator on Monday declared it will investigate power-generation firms for alleged collusion in the face of successive plant shutdowns that may have contributed to price hikes in the retail electricity market. The Philippine Competition Commission (PCC) said it will look into allegations of collusion or abuse of dominance against power-generation firms for the spate of plant outages in Luzon. In a statement, it said the string of shutdowns among power plants may have resulted in higher prices reflected in electricity bills of consumers. Last week the Luzon power grid was placed under red alert for three consecutive days, of which the last was on Good Friday, after an unexpected outage at a plant in Limay, Bataan. As a result, rotational brownouts were experienced in many parts of Luzon, including Manila, Quezon City, Bulacan and Pampanga. The PCC asserted that these outages should be probed to assess
Under the Philippine Competition Act, the PCC is mandated to promote fair market competition, prohibit anticompetitive behavior among businesses across sectors, including the power sector, and advance consumer welfare in the process.” —PCC Statement whether they were orchestrated to manipulate electricity prices, or were legitimate unplanned breakdowns that affect supply conditions. “Under the Philippine Competition Act, the PCC is mandated to promote fair market competition, prohibit anticompetitive behavior among businesses across sectors, including the power sector, and advance consumer welfare in the process,” the statement read. Further, the PCC warned power producers from engaging in anticompetitive or collusive behavior.
n JAPAN 0.4630 n UK 67.3219 n HK 6.6043 n CHINA 7.7260 n SINGAPORE 38.2302 n AUSTRALIA 36.9866 n EU 58.2565 n SAUDI ARABIA 13.8153
See “PCC,” A2
Source: BSP (22 April 2019 )