Mindanao Gets Most Project Approval in Philippine Rural Development Project

Mindanao is getting the bigger chunk in terms of approval of projects in the Department of Agriculture (DA) Philippine Rural Development Project (PRDP) through funding from the World Bank, the Philippine Government and Local Government Units (LGUs).

In a press conference hosted by DA in Cagayan de Oro on 8 September 2015, the department reiterated that in fact more than 50% of the approved project for infrastructure is from Mindanao.

DA Undersecretary Emerson Palad said that the ultimate goal of PRDP is to increase income of farmers by 30% at the end of the project.

PRDP is a six year national government platform for an inclusive, value chain-oriented and climate resilient agriculture and fisheries sector. It is the upscale version of the Mindanao Rural Development Program (MRDP) where innovations are introduced to address current and emerging challenges like climate change and make rural development more effective.

Arnel De Mesa, Deputy Project Director of PRDP said that there is no specific budget allocation per island for this project. With a total of P27.5B fund resources to spend for six years, 67% or P18.5B goes to infrastructure support, 22% or P7B goes to investments in enterprise, 8% goes to planning and 2% goes to project management.

The projects that will be approved come from the proposals of each LGU.  However, prior to the approval, proposals must go through processes.

First, proposal must be demand driven and must be the need of the community. Second, it must be commodity and market driven wherein there is an assurance of income due to its demand in the market, thus will increase income and generate employment. Third, an LGU must have a Provincial Commodity Investment Plan (PCIP) where various stakeholders have been consulted.

According to DA regional director Lealyn Ramos, the LGUs of Mindanao have been receptive about the program. This is because they will only spend 10% of the total budget for a project approved; 80% would come from the World Bank and the other 10% from the national government.

Ramos said that there is no limit to the project an LGU wants to propose provided that they can produce their 10% share and they can provide documents.

In Mindanao, she said that there are already 75 provincial LGUs out of 81 who are engaged in PRDP. Total of 23 farm-to-market road (FMR) projects or P930M budget have already been approved for Northern Mindanao. Meanwhile, P4.9B worth of various projects have already been approved for Mindanao island and another P4.9B is waitlisted for review.

Ramos said that we are now into up scaling of products. If a farmer is into cacao, then products would include chocolates; there will be factory and packaging will be improved.

The Department reiterates that they are very strict in terms of the implementation of this project. They have now what you call online tracking tool, geotag, wherein photos of the before, during and after of the project will be put online by contractors. Through geotagging, they will know if a project is already done in the area. The department assures that there is no duplication of project in the same area. (JMOR/PIA10)

Hot Money Flees Philippines in August: Net Outflow Reaches $ 542 M

By Lawrence Agcaoili (The Philippine Star)

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Inflows of hot money into the Philippines fell 46 percent to $1.11 billion in August from $2.07 billion in the same month last year, while outflows inched up by 4.7 percent to $1.66 billion from $1.58 billion.Philstar.com/File

MANILA, Philippines - More foreign portfolio investments or hot money fled the Philippines after a global stock market rout late last month, prompting investors to take profits.

According to the Bangko Sentral ng Pilipinas (BSP) foreign portfolio investments recorded a net outflow of $542.52 million in August, a complete reversal of the net inflow of $483.45 million in the same period last year.

Inflows of hot money into the Philippines fell 46 percent to $1.11 billion in August from $2.07 billion in the same month last year, while outflows inched up by 4.7 percent to $1.66 billion from $1.58 billion.

The BSP said outflows grew due to profit taking. Foreign portfolio investments are also known as hot money since these are speculative capital flows that move very quickly in and out of markets.

About 88.7 percent of investments registered in August were in listed securities at the Philippine Stock Exchange (PSE) particularly in holding companies, banks, property developers, telecommunication providers as well as food, beverage and tobacco firms.

On the other hand, about 10.8 percent of total inflows last month were invested in peso-denominated government securities.

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The central bank said the rest of the investments were in peso time deposits and other peso debt instruments.

In August, the BSP said foreign portfolio investments in PSE-listed securities recorded a net outflow of $323 million followed by peso-denominated government securities with $220 million, and peso time deposits and peso debt instruments with $4 million.

Only transactions in peso time deposits last month yielded a net inflow of $4 million.

The PSE index was dragged down by a global stock market rout last Aug. 24 as it booked its 11th biggest recorded drop of 6.7 percent to close at 6,791.01.

The BSP said hot money from the US, United Kingdom, Singapore, Luxemburg, and Hong Kong accounted for 82.3 percent of total inflow, while 81.4 percent of the outflows went back to the US.

Foreign portfolio investments recorded a net outflow of $64.25 million from January to August  compared with a net outflow of $572.83 million.

Inflows inched up 2.6 percent to $14.59 billion from January to August compared to $14.22 billion in the same period last year, while outflows retreated by almost one percent to $14.65 billion from $14.79 billion.

Philippines plan to acquire submarine; Navy captain now schooling in Germany

By Mario Casayuran, Manila Bulletin

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The Philippines has added a submarine or two to its shopping list for its military modernization program.

This was learned during the recent hearings of the bicameral Commission on Appointments (CA) when it confirmed three senior officers of the Armed Forces of the Philippines (AFP) although they were absent as the AFP leadership submitted to the CA explanations for their absence. One of the three was Navy Capt. Vincent J. Sibala.

Rep. Antonio A. del Rosario, chairman of the CA National Defense Committee, told his colleagues during the CA plenary session presided by Senate President Franklin M. Drilon, concurrent CA chairman, that Sibala is in Kiel, Germany, undergoing schooling on submarine warfare.

Sibala was one of the 105 senior AFP officers confirmed by the CA last Wednesday. Heading that list was Hernando Delfin Carmelo A. Iriberri, as the 46th AFP chief of staff and as a four-star general.

Asked by Bulletin whether the country has indeed added a submarine or submarines to its shopping list, Del Rosario replied in the affirmative. The planned submarine acquisition is under the proposed P25-billion AFP modernization program. That program, according to Del Rosario, includes airplanes and helicopters.

He could not give details on the AFP modernization program since his responsibility, he said, is centered on deciding whether or not a military officer is fit to hold such office.

Del Rosario said the AFP is supposed to complete its buying program before the end of the six-year term of President Aquino which ends June 30, 2016.

He commented that what the Philippines needs is peace, “but we don’t want to be bullied,” alluding to the present maritime dispute between the Philippines and China.

Asked if the submarine and other modern military hardware being purchased are enough to face a big military power, he replied that even ants can bite.

PNoy: Philippines Ready to Help Syrian Refugees

By: philstar.com) updated September 8, 2015 - 6:54pm

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File photo shows President Benigno Aquino III speaking at the United Nations headquarters in September 2014. AP/John Minchillo

MANILA, Philippines - President Benigno S. Aquino III said Tuesday that the Philippines is ready to help refugees from conflict-stricken Syria.

In a media forum aired on state-run People's Television, Aquino noted that the Philippines helped other asylum-seekers in the past.

Aquino cited the case of the 2,700 Vietnamese boat people who sought refuge in the Philippines in the 1970s.

He also mentioned the over 1,200 European Jewish refugees who were saved by the Philippines from Adolf Hitler's Nazi Germany during the Holocaust.

"We have proven, as a country, that we are ready to assist," Aquino said.

But with limited resources and millions living in poverty, Aquino said the Philippines can only do so much.

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"The history is there, the culture is there. We just want to make sure that we manage it properly, that we don't take more than what we can handle," he said.

"Vast majority of our people are still living in poverty. We would like to take our resources to better our people and do our fair share," the president said.

Be patient - fund managers advise potential investors

By Prinz P. Magtulis (The Philippine Star)

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Private equity investors emphasized yesterday the need for long-term objectives when it comes to placing money in one of Asia’s fastest growing economies as hurdles ranging from the most common infrastructure gaps to tightly family-controlled conglomerates remain. File photo

MANILA, Philippines - If you want to invest in the Philippines, you got to be “patient.”

Private equity investors emphasized yesterday the need for long-term objectives when it comes to placing money in one of Asia’s fastest growing economies as hurdles ranging from the most common infrastructure gaps to tightly family-controlled conglomerates remain.

“Get in! But be patient. (Your) horizon has to be longer term, around 10 years (or more),” said George Drysdale, chairman and chief executive officer of Marsman-Drysdale Group.

“There’s not much of transactional mentality here, they are the kind of long-term oriented. When you come in, you have to understand that,” he said during the forum Philippines 2015: Global Perspective, Local Opportunity in Makati City.

Michael Rodriguez, managing director of Macquarie Infrastructure and Real Assets, agreed, saying, however, this should not stop investors from coming into the country and “expand the level playing field.”

One way to do this is to “partner” with these families for the long term, Brian Hong of CVC Capital Partners, which manages $10 billion in Asia said, but added “dispute and exit mechanisms” should also be in place.

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Anders Stendebakken, managing director of Brummer and Partners, said Filipino perception of foreigners “going in and taking control” will need to change and one way to do that will be to prove that investors are “value added to families.”

There are no immediately available list of all family conglomerates operating in the Philippines, but among the Forbes’ top 1,000 corporations, eight Philippine firms, with market capitalization of $77.5 billion, were included, all of which are family operated.

Shanaka Jayanath Peiris, resident representative of the International Monetary Fund, said the Philippines also needs to attract more foreign investors to address its infrastructure woes.

Rodriguez said this should start from the government, which needs to ensure “quicker” disbursement of funds.

“There are still a lot of systemic inefficiencies and problems. Infrastructure and bureaucratic problems still exist. There needs to be a desire by the government for projects to happen much quicker,” he explained.

Rodriguez, however, said “there has been some results,” especially in terms of public-private partnerships (PPP), where 10 projects worth roughly $5 billion have already been awarded.

Much of the forum also underscored continued opportunities for the Philippines in sectors such as tourism, health care, real estate and financing as part of a growing economy. In terms of raising funds, capital markets serve also a good avenue despite recent volatility.

“When the markets are volatile, the first thing I asked my issuers is, ‘how’s your business growing? Is it still driving in the way you want it to be?’. And so far, the response has been quite positive. Growth is still fairly strong. The fundamental underlying is still strong,” said Reggie Cariaso, capital markets head at BPI Capital Corp.