Implement more financial reforms, govt told
D
ESPITE the Philippines’s recent exit from the Financial Action Task Force’s (FATF) grey list on money laundering and terrorism funding, economists stressed the need to sustain reforms and called for stronger digital infrastructure and stricter financial oversight to prevent relisting. After the Philippines’s delisting, the country may now look forward to increased foreign direct investments, no more “de-risking” in cross-border payments, and a credit upgrade. (See: https://businessmirror.com.ph/2025/02/22/ boon-to-phl-with-fatf-grey-listexit-more-fdi-easier-cross-border-payments-credit-upgrade/).
KNOW WHAT YOU EAT: PROCESSED FOOD IN OUR DAILY LIVES—A SMARTER APPROACH! A FRESH TAKE ON NUTRITION WITH DR. CELESTE TANCHOCO
ROTARY CLUB OF MANILA JOURNALISM AWARDS
2006 National Newspaper of the Year 2011 National Newspaper of the Year 2013 Business Newspaper of the Year 2017 Business Newspaper of the Year 2019 Business Newspaper of the Year 2021 Pro Patria Award PHILIPPINE STATISTICS AUTHORITY 2018 Data Champion
»A14
However, economists and the president of the FATF said the government should sustain its antimoney laundering and counterterrorism financing reforms. FATF President Elisa de Anda Madrazo said reforms must be sustained to prevent “future vulnerabilities.” The Philippines must also continue to refine its counterterrorism financing measures, ensuring effective identification and prosecution of terrorism financing cases, while preventing unnecessary disruption to legitimate nonprofit organization (NPO) activities. “Serious threats continue to remain especially because the country remains in need of capi-
tal whether obtained legally or not,” Ateneo de Manila University Economist Leonardo A. Lanzona told BusinessMirror. As such, the government must leverage technology and innovation by investing in artificial intelligence-powered transaction monitoring systems to detect and prevent suspicious transactions in real-time, Lanzona said. The government is expecting faster and lower-cost cross-border transactions and reduced compliance barriers, making it prone to money laundering activities and terrorism financing. Lanzona said upgrading digital infrastructure through fully integrating the Philippine Identifi-
cation System (PhilSys) will also secure identity verification across financial transactions and build robust defenses against cybercrime. “While exiting the FATF grey list removes a major barrier to investments, the Philippines must compete on its strengths, such as its young workforce, service-driven economy and tourism potential,” Lanzona told this newspaper. “Regional competitors are also aggressively courting investors, so policy consistency, infrastructure upgrades, and targeted investment promotions will be critical,” he added. Moreover, Lanzona warned the See “Implement,” A2
BusinessMirror A broader look at today’s business
Monday, February 24, 2025 Vol. 20 No. 135
EJAP JOURNALISM AWARDS
BUSINESS NEWS SOURCE OF THE YEAR
(2017, 2018, 2019, 2020, 2021) DEPARTMENT OF SCIENCE AND TECHNOLOGY
2018 BANTOG MEDIA AWARDS
‘RRR CUT UNLIKELY TO BOOST PHL GROWTH’ www.businessmirror.com.ph
n
P25.00 nationwide | 2 sections 22 pages | 7 DAYS A WEEK
By Reine Juvierre S. Alberto
T
@reine_alberto
HE decision of the Bangko Sentral ng Pilipinas (BSP) to reduce the reserve requirement (RRR) ratios for banks and nonfinancial institutions, which will boost liquidity, may not prop up the country’s GDP in the short term, according to economists. Last February 21, the BSP said it will reduce the RRR for universal and commercial banks (UKBs), as well as non-bank financial institutions with quasi-banking (NBQBs) functions, by 200 basis points (bps) to 5 percent. (See: https://businessmirror. com.ph/2025/02/22/bsp-to-cut-rrr%e2%82%b1330-b-funds-seen-unlocked/). Also, the RRR for digital banks will be trimmed by 150 bps to 2.5 percent while thrift banks will see a 100-bps See “RRR,” A2
DANCING IN BLOOM: BAGUIO’S STREETS BURST WITH COLOR Dancers in vibrant costumes and elaborate floral props take to the streets of Baguio City during the Grand Street Dance Parade of the 29th Panagbenga Flower Festival on February 22, 2025. The annual festival, derived from the Kankanaey term meaning “season of blooming,” was first held in 1996 to celebrate the city’s resilience after the 1990 Luzon earthquake. Now one of the Philippines’s most anticipated events, Panagbenga highlights the rich cultural heritage, artistry, and floral abundance of the Cordillera region, drawing thousands of visitors each year. MAU VICTA
U.S. PLAN TO SLAP HIGHER TARIFFS ON CHIPS SEEN AFFECTING ASIAN NATIONS
J
By Andrea E. San Juan
APAN-BASED think tank Nomura said Asian economies, including the Philippines, should not ignore US President Donald Trump’s threat to slap tariffs on chips, as the region is not spared from a larger risk of economic damage from indirect effects. “Even though the direct impact of higher chip tariffs on Asia may be limited in the near term, we see a larger risk of economic damage to the region from indirect effects, as the multitude of tariffs pushes up US inflation and weighs on US consumer demand,” Nomura said in a commentary. The think tank said a slowdown in US consumer demand would have a “more widespread” impact on the region, given the presence of Asian economies across different stages of the electronics value chain.
Explaining the indirect effects on Asia’s electronics supply chain, Nomura said its US economics team expects higher tariffs to drive US core inflation “significantly” above 3 percent in mid-2025 and a slowing of real personal consumption expenditure growth from an annualized rate of 4.2 percent in the fourth quarter of 2024 to 1.4 percent by the fourth quarter of 2025. “This could have a more material impact on Asian exports,” it added. Nomura said semiconductors accounted for only 5.4 percent of total Asian exports to the US in 2023, but exports of electronics (including semiconductors) had a “more hefty share” of 32.4 percent. “Moreover, the region is part of an intricate supply chain network, with significant trade in intermediate consumer products that are evenSee “U.S.,” A2
BIR to run after more users, sellers of ‘ghost receipts’
T
HE Bureau of Internal Revenue (BIR) plans to collect about P8 billion from cases involving ghost receipts this year as it continues to pursue legal actions against buyers of fake receipts to plug tax leakages. Speaking to reporters on the sidelines of the Revenue Region No. 7B-East NCR Tax Campaign Kickoff last Friday, Internal Revenue Commissioner Romeo D. Lumagui said the agency is targeting to double its collection from individuals and businesses that sell or use fake receipts to evade payment of taxes. The BIR’s Run After Fake Transactions (RAFT) campaign has yielded P4.3 billion for the
agency in 2024. This surged by sevenfold compared to the BIR’s collection of more than P600 million in 2023. Lumagui said the P4.3-billion collection was gathered from only a few taxpayers and the agency expects to generate additional funds. “We’re continuing to file cases and we’ll continue to file more cases,” he told reporters in an interview. However, doubling the agency’s take from ghost receipts would be “challenging,” according to the BIR chief. Once those facing charges pay their liabilities, cases filed against them will be forfeited,
EXPLAINER »B4
GAME OF TRUMP A KING’S GAMBIT IN WASHINGTON ILLUSTRATION: FREEHAND2 VIA DREAMSTIME
See “BIR,” A2
PESO EXCHANGE RATES n US 57.9920 n JAPAN 0.3876 n UK 73.4701 n HK 7.4575 n CHINA 8.0110 n SINGAPORE 43.4983 n AUSTRALIA 37.1033 n EU 60.9090 n KOREA 0.0405 n SAUDI ARABIA 15.4646 Source: BSP (February 21, 2025)