Japanese firms seek WFH setup in ecozones
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OME members of the Japanese Chamber of Commerce and Industry of the Philippines Inc. (JCCIPI) have raised issues on the work-from-home (WFH) arrangements and the proclamation of new economic zones in the Philippines as the business group vows to strengthen its partnership with the Philippine Economic Zone Authority (Peza) in attracting foreign direct investments (FDI). According to Peza Director General Tereso O. Panga, some members of JCCIPI want Pezaregistered business enterprises (RBEs) to also enjoy flexible work arrangements while retaining their incentives. “JCCIPI members are asking
whether Peza has resolved the issue on WFH…Their clamor is for Peza [registered business enterprises] RBEs to be able to avail of flexible work with incentives following the same treatment for [Board of Investments] BOI RBEs,” Panga said in a Viber message sent to reporters on Tuesday. The Peza chief also reported that in Peza, they are pushing for a hybrid workplace with a maximum 30-percent allowance for work-from-home. “Most of our locators would like to keep their Peza registration and sites, while availing of flexiwork for their workers,” Panga stressed. In September 2022, the Fiscal Incentives Review Board (FIRB)
ag reed to a l low the transfer of registered IT and Business Process Management (IT-BPM) companies to the Board of Investments (BOI) in an effort to resolve the sector’s “long-standing” issue on tax incentive claims while performing business activities outside their zone limits. Diokno earlier said that the decision of the Board establishes a more permanent solution to the issue, allowing the RBEs to continue availing fiscal incentives without violating Section 309 of the National Internal Revenue Code of 1997, as amended by the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act. T he prov ision spec if ica l ly states that to be entitled to incen-
tives, the conduct of registered projects or activities must be within the geographical boundaries of the ecozone or freeport administered by the concerned investment promotion agency (IPA). The BOI is the only IPA not affected by boundary constraints or zone limits.
New ecozones
MEANWHILE, Panga said another issue that the JCCIPI members raised was the proclamation of new ecozones. “On the proclamation issue, JCCIPI members are asking if [Office of the President] OP can speed up the process for ecozone See “WFH,” A2
BusinessMirror A broader look at today’s business
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Wednesday, May 24, 2023 Vol. 18 No. 219
P25.00 nationwide | 2 sections 24 pages | 7 DAYS A WEEK
THINK TANK: CONSUMER SPENDING CONSTRAINED
‘Inflation to cut Q2 growth to 5.8%’ By Jasper Emmanuel Y. Arcalas
Index shows: Construction prices in Mla trending up
@jearcalas
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HE “elevated ” prices of goods and services will dent the country’s economic performance in the second quarter, slowing it down further to 5.8 percent, the lowest in nine quarters, a local think tank said. The First Metro Investment Corporation-University of Asia and the Pacific (FMIC-UA&P) Capital Market Research projected t hat t he Phi l ippines’s second quarter economic performance would be slower than the 6.4 -percent GDP growth it posted in the first quarter. “GDP growth may slow mildly to 5.8 [percent] [year-on-year] in [the second quarter] as elevated inf lation constrains consumer spending,” the think tank said in its latest Market Call report released on Tuesday. The first-quarter GDP growth of the Philippine economy was the lowest in the past eight quarters or since the second quarter of 2021, based on historical data from the Philippine Statistics Authority. None t he le s s , F M IC- UA & P Capital Market Research pointed out that it expects “strong gains” in construction sector due to “accelerating” infrastructure work as well as in the services sector due to revenge spending by Filipinos on transport, food, and accommodation. “With these gaining further traction in [second half ] and sharply lower inflation rates to average 3.3 percent by [fourth quar ter], we see a retur n to above-6 percent full-year growth in 2023,” FMIC-UA&P Capital Market said the 6 percent or higher See “Q2,” A2
By Andrea E. San Juan
I READY, DREDGE! A team from the Department of Public Works and Highways (DPWH) in Marikina City uses a dredging machine on a floating platform to tackle waste-related flooding. By deepening the Marikina River and removing accumulated waste, they aim to improve flood management and enhance community safety ahead of the rainy season. NONOY LACZA
IMPORTERS SEEK LOW MEAT TARIFFS; LOCALS BALK
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EAT importers are lobbying the economic m a n a gers to lower the tariff rate levied across all meat products, including offal, to just 5 percent, arguing that it would keep inflation in check amid global economic and food challenges. The biggest farm coalition called out the importers’ bloc, however, reminding them that with government support being anemic, “tariff is the local industry’s last refuge.” “We write regarding the ongoing MFN [Most Favored Nation] tariff review. MITA had proposed
that all meat and edible offal be levied a 5 percent rate across the board,” the Meat Importers and Traders Association (Mita) said in a letter addressed to Socioeconomic Planning Secretary Arsenio Balisacan dated May 22. The letter was also submitted to President Marcos Jr., who concurrently sits as the agriculture chief, and to various Cabinet secretaries like Finance Secretary Benjamin E. Diokno and Trade Secretary Alfredo Pascual. A copy of the letter was also sent to Bangko Sentral ng Pilipinas Governor Felipe Medalla.
In its letter, Mita argued that the expiry of the current temporary low tariff rates on pork products would cause an uptick in meat prices that could hurt Filipino consumers. The latest Executive Order, which was issued by the sitting president, extended the lower inquota and out-quota tariffs on pork, which are 15 percent and 25 percent, respectively, until the end of the year. “Needless to say, reversion to a higher duty rate will further raise the cost of imported pork meat and discourage imports,”
said the letter, which was signed by Mita’s President Sher win Choi and President Emeritus Jesus C. Cham. The group has argued anew that the recovery of the local hog sector would take at least five years before domestic pig output returns to pre-African swine fever (ASF) levels. “ The five-year period was premised on the containment of ASF or the discovery of a vaccine, none of which has materialized. We are now in the fourth See “Tariffs,” A2
NFLATION has pushed Manila’s construction prices upwards, according to global engineering and consultancy solutions firm Arcadis’ latest International Construction Costs index. According to the Arcadis 2023 International Construction Costs (ICC) report with the title “New Horizons,” Manila has ranked 81st in the study of comparative construction costs across 100 global cities. In a statement on Tuesday, Arcadis noted that “Manila’s ranking held steady from last year’s index, but annual inflation hit its highest level in 14 years, pushing construction prices upwards.” The company said pandemic-related restrictions in 2022, labor shortages, material costs and rising fuel prices still “posed challenges” to the construction industry. Despite these obstacles, Arcadis Country Sales/Client Development Director Jocelyn Pagcatipunan said, “the industry was able to adapt well by implementing measures such as bundling packages for different projects to save time and cost, using locally sourced materials that meet standards, and early collaboration with suppliers to ensure the availability of required items and goods on site.” See “Index,” A2
PESO EXCHANGE RATES n US 55.7970 n JAPAN 0.4027 n UK 69.3947 n HK 7.1279 n CHINA 7.9361 n SINGAPORE 41.4570 n AUSTRALIA 37.0994 n EU 60.3445 n KOREA 0.0425 n SAUDI ARABIA 14.8796 Source:
BSP (23 May 2023)