BusinessMirror September 23, 2021

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RCEP ‘on track’ for ’22 implementation B T J C. P @Tyronepiad

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HE Asean community and its free trade agreement (FTA) partners are on course to enforce one of the biggest economic trade pacts by early next year, the Department of Trade and Industry (DTI) said on Wednesday. Trade Secretary Ramon Lopez said the parties of the Regional Comprehensive Economic Partnership (RCEP) are looking forward to implementing the mega trade deal, as this will

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facilitate further crossborder business activities. “The Asean and its FTA Partners also remain on track to implement the Agreement by January 1, 2022,” he said in a virtual event on Wednesday. Earlier this month, President Duterte ratified the RCEP document. It will be brought to the Senate for concurrence “soon,” Lopez said. The trade agreement was signed by 10 memberstates and five Asean FTA partners—Australia, China, Japan, Korea and New

Zealand—in November last year. The RCEP region accounts for 29 percent or $25.8 trillion of the global gross domestic product, 30 percent of the world’s population and 25 percent ($12.7 trillion) of global trade in goods and services. Trade Assistant Secretary Allan B. Gepty said the regional bloc also accounts for half of the global manufacturing output and automotive products; and 70 percent of the electronic products. Both Lopez and Gepty underscored the importance

of RCEP as this promotes regional economic integration, strengthening the recovery efforts of the country amid the pandemic. Among the perks cited under the deal are better market access on goods, services and investments. “[We] should view RCEP not just as a plain trade agreement that provides enhanced market access and stable business environment, but as a strategic tool to sustain the region’s economic advantage,” Gepty said. S “RCEP,” A

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Thursday, September 23, 2021 Vol. 16 No. 344

P.  |     | 7 DAYS A WEEK

BSP PUSHING SPEEDY PASSAGE OF REVISED CHARTER FOR PDIC B B C @BcuaresmaBM

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MOTORISTS pass by an electric vehicle charging station on Edsa. The Philippines aims to reduce its greenhouse-gas emissions by 75 percent by 2030 as part of its responsibility to mitigate the global climate crisis. NONIE REYES

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B C U. O

@caiordinario

HE fragile recovery of the Philippine economy continues to make its prepandemic growth trend elusive, according to the Asian Development Bank (ADB).

In its Asian Development Outlook Update (ADOU), the Manilabased multilateral development bank maintained its growth and inflation expectations for the Philippines. However, based on ADB data, the Philippines’s GDP growth remains 14.9 percent below its prepandemic growth trend, the lowest

among Southeast Asian countries. The average growth in Southeast Asia is still 8.6 percent below its prepandemic trend. “The forecast is not that GDP will be 8.6 percent below prepandemic levels; rather, GDP was growing along a trend line, and

HE Bangko Sentral ng Pilipinas (BSP) said it is currently working with various sectors of the government toward the swift passage of amendments to the Philippine Deposit Insurance Corporation (PDIC) charter. In a briefing on Wednesday, BSP Governor Benjamin Diokno said the proposed amendments to the PDIC Charter are expected to improve coordination between the bank regulator, and the deposit insurer and bank receiver. This is seen to strengthen supervision of banks and support financial stability. As such, the BSP is working alongside Congress, the Department of Finance, and the Philippine Deposit Insurance Corporation (PDIC) to expedite the passage. In particular, Diokno said the BSP is confident that the proposed amendments will further enhance PDIC’s capacity to promote and safeguard the interests of the depositing public, and effectively perform its mandate as deposit insurer and liquidator of banks.

Diokno cited four important provisions that are crucial inclusions in the amendments. First, the governor said the authority should be granted to the PDIC Board to raise the maximum deposit insurance coverage to an amount indexed to inflation or in consideration of other economic factors. “We believe that this will give PDIC the flexibility to implement its mandate as the country’s deposit insurer. More importantly, this will provide additional safeguard to the depositing public,” the governor said. Second, the governor calls for changes in PDIC’s organizational structure and the attachment of PDIC to BSP. Currently, PDIC is attached to the Department of Finance (DOF). Third, the amendment should include the consolidation of certain powers of the PDIC to BSP. “This will prevent overlapping functions that should be with BSP as the primary regulator of banks,” Diokno said. And fourth, amendments C  A

C  A

Senate rushes bill correcting BIR rule on schools’ tax

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HE Senate approved on second reading on Wednesday a measure amending the tax code in order to reverse the Bureau of Internal Revenue’s controversial circular that increased by 150 percent the corporate income tax (CIT) of proprietary private schools already reeling from the pandemic. Late Tuesday, it ended deliberations on the clarificatory SB 2407 that was authored by Sen. Juan Edgardo Angara to correct the BIR’s misrepresentation of lawmakers’ intent in crafting

the Corporate Recovery and Tax Incentives for Enterprises (CREATE). And, with the apparent unanimous mood in the Senate to champion the appeal of desperate private schools, Majority Leader Miguel Zubiri projected second and third reading approval as soon as possible. Angara filed the amendatory bill soon after the BIR issued a circular after the passage of CREATE, which slapped proprietary schools with a 150-percent CIT hike. Because of the pandemic lock-

PESO EXCHANGE RATES ■ US 50.1330

RECTO: “If you recall, CREATE was marketed as the law that will save distressed companies from sinking in a sea of red ink.”

downs’ impact on business, CREATE had granted relief to all other businesses buy reducing their CIT rates from 30 percent to 25 percent. The BIR circular put the schools on par with the businesses, but by slapping them with 25-percent tax, it effectively brought up the taxes they have been paying, or 10 percent—or a 150-percent hike. Senate President Pro Tempore Ralph Recto on Tuesday paved the way for plenary deliberations inC  A

■ JAPAN 0.4591 ■ UK 68.4967 ■ HK 6.4386 ■ CHINA 7.7532 ■ SINGAPORE 37.0752 ■ AUSTRALIA 36.2612 ■ EU 58.7960 ■ SAUDI ARABIA 13.3681

Source: BSP (September 22, 2021)


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