BSP joins UN responsible investment network
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WOMEN’S WORLD CUP CHAMPS Spain is hailed as the FIFA Women’s World Cup champion following a 1-0 victory over England in the final on Sunday at the Stadium Australia in Sydney, Australia. Story in B8 Sports. AP
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N a bid to strengthen its sustainability efforts, the Bangko Sentral ng Pilipinas (BSP) signed the United Nationssupported Principles for Responsible Investment (PRI). The PRI is the leading global network of public and private institutions committed to incorporating environmental, social and governance (ESG) considerations into their investment practices. The network was developed in 2005 by a group of the world’s largest institutional investors in a process convened by then United Nations Secretary-General Kofi Annan. By signing the PRI, investors commit to integrating ESG issues into their policies, where consistent with their fiduciary responsibilities. “We are extremely pleased to welcome BSP as a PRI signatory. As the central bank for the Republic of the Philippines,
BSP has a broad mandate and responsibilities, and a unique opportunity to influence the responsible investment ecosystem in the market,” PRI CEO David Atkin said. “BSP is to be commended for its commitment to incorporate ESG factors into its ownership and investment decisions, and we look forward to working with the team,” he added. With this, the BSP complements its membership to the Network of Central Banks and Supervisors for Greening the Financial System (NGFS) and is part of the BSP’s 11-point Sustainable Central Banking (SCB) Strategy. The BSP recognizes that in fulfilling its mandates, it must take concrete actions in promoting the sustainability agenda. Joining the PRI aligns with the Bank’s mission and values. This initiative allows the BSP to
deepen its understanding of responsible investing, enhance the inclusion of ESG factors into the overall investment process and decision-making, benchmark its practices with other PRI signatories, and thereby, help achieve the BSP’s sustainability objectives. Earlier, BSP Governor Eli Remolona Jr. said the BSP intends to strengthen its research capabilities in its quest to deepen capital markets to make the financial sector sustainable. Remolona said the BSP is committed to contributing to the country’s efforts to achieve net zero through its 11 sustainability strategies. One of these is to mandate banks to make climate-related disclosures. He explained that banks would be tasked to report which of their loans and assets is good, bad, or worse for the climate. See “BSP,” A2
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NO ‘EASY’ TAXES; M.I.F. TO PAD DEBT—MEDALLA w
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Tuesday, August 22, 2023 Vol. 18 No. 309
P25.00 nationwide | 2 sections 18 pages |
By Cai U. Ordinario
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Local rice prices still rising–new DA data
@caiordinario
HE tax reforms undertaken in recent years have left the government scraping the bottom of the barrel of “easy” taxes that could help shore up additional funding for its various projects and programs without taking in more debts, according to former Bangko Sentral ng Pilipinas (BSP) Governor Felipe M. Medalla.
Given this, fiscal discipline is needed now more than ever, said Medalla, also a former Socioeconomic Planning Secretary. Addressing a recent forum at the University of the Philippines School of Economics, Medalla said, however, this does not mean reducing spending but “slowing down increases” in spending. In a presentation, he noted that the country’s debt has risen considerably, up to 74 percent [of GDP] between 2019 and 2022. “I think this to me, this is my worry, that the relatively easy taxes are not available anymore. When you start thinking [about] taxing junk food, you’re really scraping the bottom and that’s why I think the only solution is some control over current expenditures,” Medalla said in his presentation. Medalla said it took about 75 to 77 years for the country’s debt to reach P6 trillion, and the process started sometime in 1946-1948, after World War II. But, he said, it only took six years for that number to more than double in recent years. However, this trend could be erased by fast economic growth of about 7 percent annually, according to Medalla. Nonetheless, this still means that revenues must grow faster than economic growth and the government adheres to fiscal discipline. “There’s a long story to it, which I don’t have time to sell but at any rate, this is now a big dilemma that we have to face. Now the good news. If we grow very fast, the problem will solve itself,” Medalla said. See “Taxes,” A2
By Samuel P. Medenilla @sam_medenilla
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PORT OF NO RETURN Amid the backdrop of the setting sun at Binangonan Passenger Terminal en route to Talim Island, a lone passenger’s silhouette stands poignant, while the memory of a recent tragic incident looms: over 20 lives were lost when the motorboat MB Aya Express capsized on July 27, the second maritime disaster this year after 33 people died in an 8-hour ferry fire in Basilan in March. The terminal now houses a Coast Guard kiosk. BERNARD TESTA
30% CUT IN D.A. BUDGET COULD DERAIL MARCOS C.S.F. PLANS By Jasper Emmanuel Y. Arcalas @jearcalas
THE reduction in the agriculture department’s budget for infrastructure program by almost 30 percent could derail President Marcos’s plan of building more cold storage facilities (CSF) for commodities nationwide, according to a policy study. The Congressional Policy and Budget Research Department (CPBRD) noted that the Agriculture Machinery & Equipment, Facilities and Infrastructure Program (AMEFIP) by the Department of Agriculture (DA) is anticipated to have a 27.2-percent budget slash next year. In its latest Agency Budget Note
(ABN), the CPBRD, citing economists and experts, emphasized that the funding reduction could have negative implications on the state’s goal of improving the country’s agricultural value chains. Under the 2024 National Expenditure Program, the budget for the AMEFIP would be at a three-year low of P8.299 billion, about P3.097 billion lower than its P11.396 billion budget this year. With the reduction, the share of AMEFIP to the total value of programs of the agriculture department shrank to 8.6 percent from 12.5 percent this year. The AMEFIP budget is lodged to the Office of the Secretary’s total allocation.
The CPBRD cited a 2023 budget analysis report by a group of experts and analysts led by Finance Assistant Secretary Karlo Fermin S. Adriano in emphasizing the implications of the lower AMEFIP funding next year. Former Agriculture Secretary Senen Bacani served as Senior Adviser for the budget analysis report titled, “Increasing Food Prices and its Impact on Food and Nutrition Security.” “Adriano, et al [2023] pointed out that the reduction seems inconsistent with the goal of strengthening the local supply chains through the enhancement of agricultural productivity and expansion of access of farmers and fisherfolk to markets in
the 2024 Budget Priorities Framework,” the CPBRD report read. The CPBRD noted that the funding for the establishment of CSFs and other post-harvest facilities could come from the AMEFIP. “No less than the President who is the concurrent DA secretary has called for the building of more storage facilities for onion and for fish to reduce post-harvest losses,” according to the report. Adriano et al.’s report explained that while AMEFIP’s funding has been mainly allocated for farmto-market road projects, there has been a recent shift towards the provision of agricultural machinery, equipment, and support services. See “Budget,” A2
OCAL rice prices continue to rise amid market concerns on the potential impact of the El Niño phenomenon on agriculture, according to new data from the Department of Agriculture (DA). In a statement issued by the Presidential Communications Office (PCO), DA said its Philippine Rice Information System showed that the average prices from January to June this year for palay or unhusked rice were P19.5 per kilo for dry and P17.4 a kilo for fresh. These were higher compared to the average prices of palay in the same period last year, which was P18.3 per kilo for dry and P15.9 a kilo for fresh. Last April, the price for dry palay reached even as high as P20.39 per kilo, while for fresh palay it was at P17.66 a kilo. This after the Philippine Statistics Authority (PSA) reported the country’s rice inventory in April dropped by 26.5 percent compared to the same period in 2022. Sebastian noted the trend has led to more profit for farmers. “For the longest time, Filipino farmers have always been at the losing end of the rice sector. But now, Filipino rice farmers are enjoying better prices from their fresh harvest, perhaps sparked by global fears of a shortage resulting from the adverse impact of El Niño forcing world suppliers to tighten supply in the world market,” the DA official said. Consumers, however, had to shoulder additional expenses because of the high rice prices. Based on the price monitoring of DA in Metro Manila markets, the price of local commercial rice last July 29 ranged from P37 to P60 per kilogram (kg), which was higher compared to the P38 to P50 per kg in the same period in 2022. As of August 21, the price of local commercial rice has risen to between P55 to P62 per kg. Malacañang and DA have been issuing statements assuring the public the country will have sufficient rice supply until the first quarter of 2024 especially with the ongoing harvest season, which is expected to peak by late September to October. The additional rice supply is projected to help in stabilizing the price of the food staple in the coming weeks.
PESO EXCHANGE RATES n US 56.6780 n JAPAN 0.3886 n UK 72.2531 n HK 7.2400 n CHINA 7.7761 n SINGAPORE 41.7394 n AUSTRALIA 36.2796 n EU 61.6090 n KOREA 0.0423 n SAUDI ARABIA 15.1133 Source: BSP (August 18, 2023)