USD global bonds net PHL $2.5B By Reine Juvierre Alberto
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HE Philippines generated $2.5 billion from the sale of tripletranche US dollar global bonds on signs of easing price pressures and increasing investors' confidence due to the United States Federal Reserve’s expected rate cuts. The Bureau of the Treasury (BTr) said on Thursday the 5.5-year tranche has a yield of 4.375 percent and was priced at US Treasuries plus 75-basis points (bps), tighter than 35bps than the initial price guidance, achieving 5bps new issue concession. The new 10.5-year was issued with a yield of 4.750 percent, 30bps tighter than
TINGI TACTICS Greenpeace Philippines, in partnership with the Metro Manila Mayors’ Spouses Foundation, hosted the ‘Kuha sa Tingi’ and Metro Manila Expansion launch MOA signing at San Juan City Hall on August 29, 2024. This event signifies a crucial step forward as the successful initiative in San Juan and Quezon City expands to all cities across Metro Manila. The program aims to reduce plastic pollution by encouraging communities to adopt reuse and refill systems. In the photo from left: Trina Biazon, Keri Zamora (President of the Metro Manila Mayors’ Spouses Foundation), Tiffany Gatchalian, and Ces Rondario of Ripple X. NONOY LACZA
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the initial price guidance, pricing at no new issue premium. Meanwhile, the new 25-year Sustainability tranche was priced at 5.175 percent at par, tighter by 32.5bps than the initial price guidance, achieving a 2.5bps new issue concession. The 5.5-year spread is the tightest among all US dollar 5/5.5-year issuances by the Philippines since June 2021. All-in yield for the 10.5-year and 25year are the tightest for US dollar 10/10.5year and 25-year issuances since March 2022. In comparison with other BBB-rated sovereigns in the region, the 5.5-year spread is the second tightest in 2024 among 5/5.5-year issuances while the 10.5-year bond all-in yield is the tightest
for USD 10/10.5-year issuances since May 2022. All-in yield for the 25-year bond is the tightest for USD 25-year issuances since March 2022. The Treasury said the Philippines banked on lower benchmark yields due to softer inflation data and “increasingly dovish Fed rhetoric” fueled investor certainty of upcoming rate cuts at their September meeting. “The transaction attracted robust demand and strong orderbook momentum carried across markets, with interest from a diverse pool of high-quality global accounts, showcasing investors’ continued confidence in the Republic’s credit profile and long-term outlook,” the Treasury added. See “USD,” A2
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Friday, August 30, 2024 Vol. 19 No. 318
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Disbursement of NG’s cash allocations quickens
By Cai U. Ordinario @caiordinario
HE Bangko Sentral ng Pilipinas (BSP) has decided to terminate the contractor for the National ID due to its failure to meet its deliverables for the project.
BSP Governor Eli M. Remolona Jr. initially told reporters that apart from the termination of the contracts, the central bank is also “negotiating for damages” while looking for a replacement. “This is a real problem. We have decided to terminate actually the old contracts because the contractor for these IDs has not been able to deliver, so we have terminated the contracts,” Remolona said. See “BSP,” A2
By Jovee Marie N. dela Cruz
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BANCA BANQUET Marlon Años, 54, and Susanna Bautista, 52, share a simple meal of rice and tomatoes with onions in soy sauce inside their makeshift home beside an abandoned banca in Barangay Lunsad, Binangonan, Rizal. Despite their challenging circumstances, Mr. Años told the BusinessMirror that they prefer to face their struggles independently: “Hindi naman po kami lumalapit, mabuti na ho ito kaysa magnakaw. [We don’t ask for help; this is better than stealing].” The couple makes a living by collecting recyclables, exchanging them for cash to get by. They are part of the statistics of millions in the region gouged by soaring prices amid stagnant wages, a situation called by a UN agency as a “cost of living crisis.” See boxed story at bottom left. BERNARD TESTA
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HE national government’s disbursement of cash allocation and the utilization of budgets by state agencies accelerated as of end-July, according to the Department of Budget and Management (DBM). Latest data from the DBM showed notice of cash allocation (NCA) released to state agencies reached P2.738 trillion from January to July 2024, higher by 9.34 percent than the P2.504 released in the same period in 2023. NCA refers to the cash authority issued by the DBM to central, regional and provincial offices and operating units to cover the cash requirements of the government agencies. Of the P2.738 trillion released to line departments, state-run corporations and local government units (LGUs), 94.37 percent or P2.584 trillion were utilized. This is higher than last year’s 92.25-percent utilization rate. See “Disbursement,” A2
of new gas wells PRICES, LOW WAGES CREATE Drilling to push through next year ‘COST OF LIVING CRISIS’–UN
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HE unabated increase in commodity prices and failure of wages to keep up with household’s needs have resulted in a “cost of living crisis” in the region, according to the United Nations Economic and Social Commission for Asia and the Pacific (Unescap). In a blog post, Unescap Economic Affairs Officer Shuvojit Banerjee said, however, that governments are not helpless in terms of addressing the crisis through greater social protection for citizens. Banerjee said social protection measures include those
that help contain price increases; targeted assistance for the most vulnerable citizens; and the need to increase fiscal space for development spending. “This cost-of-living crisis since the onset of the war in Ukraine in 2022, particularly for food and fuel, is eroding purchasing power of people in the region and exacerbating poverty and inequality concerns, which came to the fore with the breakout of the Covid-19 pandemic in 2020,” Banerjee said. See “Prices,” A2
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HE Senate Committee on Energy is betting big on the drilling of new gas wells next year which would eventually increase gas production and extend the life of the Malampaya gas platform. During interpellation of Senate Bill No. 2793 or the proposed Philippine Natural Gas Industry Act, Senator Pia Cayetano said she is bullish on the outcome of the drilling for two new gas wells by the Malampaya consortium, led by Prime Energy Resources Development B.V. (Prime Energy), a subsidiary of Razon-led Prime Infrastructure Capital. Prime Energy is a natural gas exploration and development compa-
ny. It owns a 40-percent participating interest in the Malampaya consortium and is the operator of Service Contract 38, or the Malampaya gas project. The other members of the consortium are the Philippine National Oil Company-Exploration Corporation (PNOC-EC), UC 38 LLC, and Prime Oil and Gas Inc. “Drilling will start next year, (and this) hopefully will have immediate results. So (by) then we would be able to give more updates on how much can be extracted from those new sources,” Cayetano said in reply to Senator Joel Villanueva, who inquired about the development timelines of Phase 4 of drilling program. See “Drilling,” A2
PESO exchange rates n US 56.2530 n japan 0.3894 n UK 74.2202 n HK 7.2112 n CHINA 7.8907 n singapore 43.1686 n australia 38.1564 n EU 62.5646 n KOREA 0.0422 n SAUDI arabia 14.9908 Source: BSP (August 29, 2024)