Jan GIR dips, but still enough as buffer By Cai U. Ordinario
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MISS UNIVERSE 2025 HEADS TO THAILAND Miss Universe CEO Anne Jakrajutatip (right) announces at the Miss Universe NYC Launch Event in New York that Thailand will host the 74th Miss Universe competition. A video presentation revealed Miss Universe 2024 Victoria Theilvig in Thailand, confirming the event’s locations in Bangkok, Pattaya, and Phuket. Also in the photo are Raúl Rocha Cantú (left), President of the Miss Universe Organization, and Hannah Lopa, former Miss New York USA. Story in Life, page B5. TROI SANTOS
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HE Philippines started the year with a lower gross international reserves (GIR) level compared to January and December last year, according to the Bangko Sentral ng Pilipinas (BSP). Based on the preliminary data, the country’s GIR settled at $103.02 billion as of end-January 2025. This was a contraction of 0.24 percent from the $103.27 billion in January 2024. The January 2025 figure was a contraction of 3.04 percent from the $106.3 billion posted at the end of December 2024. “The month-on-month decrease in the GIR level reflected mainly the BSP net foreign exchange operations, and drawdown on the nation-
al government’s [NG] deposits with the BSP to pay off its foreign currency debt obligations,” BSP said. The latest GIR level represents a more than adequate external liquidity buffer equivalent to 7.3 months’ worth of imports of goods and payments of services and primary income. The BSP noted that the GIR is viewed to be adequate if it can finance at least three-months’ worth of the country’s imports of goods and payments of services and primary income. Moreover, it is also about 3.6 times the country’s short-term external debt based on residual maturity. The BSP also said short-term debt based on residual maturity refers to outstanding external debt with original maturity of one year or less,
plus principal payments on medium- and long-term loans of the public and private sectors falling due within the next 12 months. “The level of GIR, as of a particular period, is considered adequate, if it provides at least 100 percent cover for the payment of the country’s foreign liabilities, public and private, falling due within the immediate 12-month period,” the BSP said. The data also showed the net international reserves (NIR) declined by $3.2 billion to $103 billion as of end-January 2025 from the December 2024 level of $106.2 billion. NIR refers to the difference between the BSP’s reserve assets or the GIR and reserve liabilities or short-term foreign debt and credit and loans from the IMF.
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AMID INFLATION WOES, BSP EASING SEEN MILD T
By Cai U. Ordinario @caiordinario
HE Bangko Sentral ng Pilipinas (BSP) may be less aggressive in easing monetary policy rates as the country continues to be hounded by its inflation woes, according to a US-based think tank.
International financial institutions also expect the BSP to implement “a more gradual” easing of Monetary Policy this year. Nonetheless, a rate cut remains expected this week. In its latest economic brief, GlobalSource Partners Country Analyst Diwa Guinigundo said reducing the required reserve ratio (RRR) is already helping increase money supply into the market. “Most important, and this is our view, there is less compulsion for the BSP to be more aggressive in easing monetary policy through the policy rates, precisely because it has also been pumping more liquidity into the system by its significant reduction in the RRR,” Guinigundo said. The former BSP Deputy Governor said the RRR is now in single-digits after the BSP reduced it by 250 basis points to 7 percent from 9.5 percent. This has infused the market with “hundreds of billions of extra money supply” which analysts said could reach over P300 billion based on the country’s full year GDP. (See: https://businessmirror.com.ph/2024/09/23/ rrr-cut-like-liquidity-infusion-of-%E2%82%B1310b%E2%82%B1330b-nomura/). Guinigundo believes the reduction of the RRR could help address the cost and profit concerns of banks as this reduces their “opportunity loss” created by deposits that sit in their vaults without interest. See “Inflation,” A2
GRAIN DEAL At a Kadiwa ng Pangulo stall in Las Piñas, NFA rice is now available at P36 per kilo—well below earlier estimates—as the Department of Agriculture intensifies measures amid a declared food security emergency. A recent survey by Social Weather Stations and Stratbase Group revealed that 59 percent of Filipinos experienced the steepest price hike for rice in the last three months of 2024, compared to 25 percent for meat, 11 percent for vegetables, and 4 percent for seafood. NONIE REYES
BETTER ISLAND CONNECTIVITY Bulk carriers’ freight rates BOOSTING TOURISM SPENDING fall amid low China demand By Ma Stella F. Arnaldo
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Special to the BusinessMirror
NCREASING connectivity among destinations in the Philippines is helping boost the spending of tourists. In a media interview, Philippine Travel Agencies Association Inc. (PTAA) public relations officer Chal Lontoc-Del Rosario said, “Like in the case of Palawan, we have flights direct to Boracay, as opposed to going back to Manila, then flying to Boracay.” The PTAA held the 32nd Travel Tour Expo (TTE) from February 7 to 9 at the SMX Convention Center in Pasay. The organization said about 35,000 would-be travelers visited TTE on the first day, alone. She explained that the increased connectiv-
ity allows travelers to explore “twin” destinations, and enable them to stay longer in the country. “I think that’s one of the patterns that [emerged] after the pandemic; people spend longer days in a particular area, and are more open to ‘twinning’ cities or going beyond one particular place. So I think that’s what [has driven] the higher revenue spending as well. So if I’m flying to Cebu, then automatically I’d probably explore Bohol as well.” The Department of Tourism (DOT) has been highlighting the increased visitor receipts last year, even as it missed its 7.7-million arrivals target. Inbound receipts surged by some 41 percent to US$13.1 billion (P760 billion) from $9.3 billion (P539.4 billion) in 2019. (See, See “Island,” A2
By Bless Aubrey Ogerio
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CEAN freight rates for bulk carriers are on a downtrend due to declining demand from China and other seasonal factors, according to Tokyo-based Mitsui O.S.K. Lines (MOL). “The current rates are actually on a downtrend for bulk carriers because there is a reduced demand in China,” Yosuke Ishibe, MOL corporate communication director, told BusinessMirror on Friday. While specific figures were not provided, Ishibe clarified that the slowdown is not due to an
oversupply of vessels but rather a drop in demand. Seasonal factors, such as the rainy season in Brazil beginning in January, and logistical disruptions, including fires at Canadian export terminals, have further contributed to the decline. Data from Taiwanese freight company Dimerco showed that the overall ocean freight market in the Philippines remains stable post-peak season. While rates may fluctuate with market conditions, ports are expected to operate normally throughout the month. It forecasts ample shipping See “Bulk,” A2
YOU’RE LOOKING AT THE FUTURE: POWERED BY AI & QUANTUM
IBM Research hosted a tour of its headquarters in Yorktown Heights, New York, on January 30, 2025, unveiling advancements in AI, quantum computing, and semiconductor technology. Key highlights included IBM’s Granite AI models, Heron quantum processors, and next-gen AI chips, shaping the future of enterprise and scientific computing. Clockwise from left: IBM Quantum System One, AI Compute Lab, System One Cryostat. Story in Companies, B1. TROI SANTOS
PESO EXCHANGE RATES n US 58.0520 n JAPAN 0.3833 n UK 72.1993 n HK 7.4557 n CHINA 7.9700 n SINGAPORE 42.9855 n AUSTRALIA 36.4741 n EU 60.2870 n KOREA 0.0402 n SAUDI ARABIA 15.4826 Source: BSP (February 7, 2025)