Wednesday, September 14, 2016

FDI Net Inflows Increase by 94.9 Percent for the First Semester of 2016

Foreign direct investment (FDI) posted net inflows of US$4.2 billion for the first semester of 2016, 94.9 percent higher than the US$2.2 billion recorded for the same period a year ago.  This reflected investors’ confidence in the Philippine economy on the back of sound macroeconomic fundamentals and robust growth.  In particular, investments of parent companies abroad in debt instruments issued by local affiliates (or intercompany borrowings) contributed a large part to the increase in FDI as these transactions more than doubled to US$2.4 billion from U$1.1 billion.  Similarly, net equity capital grew by 112 percent on account of the combined effects of higher gross equity capital placements (US$1.6 billion from US$884 million) and lower gross equity capital withdrawals (US$166 million from US$203 million).  Equity capital placements came mainly from Japan, Singapore, Hong Kong, the United States, and Taiwan.  These were infused largely in financial and insurance; real estate; manufacturing; construction; and accommodation and food service activities.  Meanwhile, reinvestment of earnings declined by 0.7 percent. 

For the month of June, FDI recorded net inflows of US$238 million, lower by 40.9 percent than the US$404 million posted a year ago.  Equity capital placements of US$36 million was lower than the equity capital withdrawals of US$41 million which resulted in net outflows of US$5 million from net inflows of US$215 million for the same month last year.  Equity capital investments originated largely from Japan, the United States, Singapore, Hong Kong, and China.  These infusions were channeled mainly to real estate; electricity, gas, steam and air conditioning supply; information and communication; wholesale and retail trade; and manufacturing activities. Investments in debt instruments rose by 49.4 percent to US$182 million from US$122 million in the previous year.  Reinvestment of earnings decreased by 7.8 percent to US$62 million during the month.




Media Release from Central Bank of the Philippines

Monday, September 12, 2016

Philippine Gov't Urged to Stop Unlicensed 'Colorum' Real Estate Agents



MANILA - Government should stop unlicensed real estate brokers who do not pay the correct taxes, the country's largest real estate service organization said Monday.
The industry loses an estimated P12 billion per year because of the "colorums" or illegal sellers, Rey Cartojano, national chair of the Philippine Association of Real Estate Boards said.
"There should be strong move from regulatory agencies to put a stop to this practice," Cartojano told ANC's "Market Edge with Cathy Yang."
Regulators are urged to monitor websites and social media, where most of the illegal sales are posted, Cartojano said.
"These people should be warned that they cannot just sell property if they are not owner and if they do not have the necessary license issued by the Professional Regulation Commission," he said.
Under the Real Estate Service Act, real estate brokers are required to obtain a license and pass the board exam before any transaction.

News from:  ABS-CBN/ANC

Tuesday, August 30, 2016

Spreading the benefits of economic gains

by Manny B. Villar - 
REAL estate is one industry that reflects and supports the strong growth of the Philippine economy. It also creates a positive chain effect by boosting other industries, like the retail business, business process outsourcing (BPO) and tourism, through the property sector’s commercial or retail, residential, office and hotel or leisure segments.
Real-estate prices are increasing, but there are no significant risks of price bubbles because of the strong demand. For residential units, in particular, demand is mainly from end-users, like overseas Filipino workers (OFWs) and business-process outsourcing workers.

In an effort to track pricing trends in the domestic real-estate sector, the Bangko Sentral ng Pilipinas (BSP) this year created the Residential Real Estate Price Indices (RREPI), which would be released every quarter. The BSP said the RREPI, based on bank-approved housing loans, could be a useful tool in assessing the real-estate and credit-market conditions in the country.
Based on the RREPI, real-property prices in the National Capital Region (NCR) increased by 9.7 percent in the first quarter of 2016, compared to the same period last year. Real-estate prices in areas outside the NCR (AONCR) increased by 9.4 percent during the same period.
Other highlights: Condominium units posted the highest year-on-year growth in prices at 12.9 percent, followed by townhouses at 8.5 percent.  About seven out of 10 residential real-estate loans granted were for the purchase of new housing units. Condominium units were the most common house purchases in NCR, while in AONCR, single detached houses were the most popular.
NCR accounted for 50.4 percent of the residential real-estate loans granted in the first quarter of 2016, followed by Calabarzon (Cavite, Laguna, Batangas, Rizal, Quezon) (28.4 percent), Central Luzon (7.6 percent), Western Visayas (3.8 percent) and Central Visayas (3.3 percent).
The real-estate sector’s growth has been so strong that some
companies are already experiencing labor shortage, particularly for skilled construction workers, as well as engineers. Property consultant Colliers International said in a separate study that this would continue to affect the delivery of real-estate units for all segments.
The Colliers study noted that six projects were scheduled for delivery in the second quarter of 2016, but only one was completed because of the “acute lack of skilled labor in construction.”
Nevertheless, the property sector is expected to sustain strong growth for the rest of the year because of low inflation (1.3 percent in the first half of 2016, well-below the government’s target of 2 to 4 percent), low interest rates and modest growth in OFW remittances.
These factors, according to Colliers, translate to greater purchasing power and higher consumer confidence, which will, in turn, benefit the various segments of the property sector.
What makes the growth of the real-estate industry significant is that its contribution to the economy is not only in terms of higher output or GDP.
The labor shortage being experienced by some developers show that the real-estate industry is a big employment generator. Jobs are being created not only during the construction phase, but also in the operation of businesses in the newly built malls, other commercial facilities, office buildings and hotels.
The real-estate industry also helps in developing new growth areas outside Metro Manila, thus encouraging and stimulating new businesses in the provinces, in the process raising household incomes in those areas.
The government’s focus on accelerating infrastructure development, particularly in many areas outside Metro Manila, like Mindanao, should also sustain the growth of the real- estate industry.
In the not-so-distant future, I hope to see the same modern landscape in the far-flung provinces of Luzon, the Visayas and Mindanao, as in Metro Manila.

Tuesday, August 23, 2016

Calata Partners with Investment, Gaming Firms for P65B Casino Resort in Cebu

Expected to be opened in 2020, the Mactan development will have 3 luxury hotels, an entertainment complex featuring a full-scale casino, and retail shopping.

GAME-CHANGER. Mactan Leisure City will introduce 3 luxury hotels, an entertainment complex featuring a full-scale casino, and retail shopping.

MANILA, Philippines – Listed agribusiness company Calata Corporation has partnered with a US-based investment group and a Macau-based gaming operator to create a real estate investment trust (REIT) for a P65-billion, 14-hectare casino resort on Mactan Island, Cebu.
Expected to be opened in 2020, the development will introduce 3 luxury hotels, an entertainment complex featuring a full-scale casino, and retail shopping.
REIT is a stock corporation created primarily for the purpose of owning income-generating real estate assets.
Calata told the Philippine Stock Exchange (PSE) on Tuesday, August 23, that it has teamed up with Sino-America Gaming Investment Group, LLC and Macau Resources Group Limited for the REIT that will be used for the 14-hectare casino resort called Mactan Leisure City.
Calata said in the regulatory filing that Mactan Leisure City will "generate tens of thousands of employment opportunities" and is expected to have a gross revenue of about P55.74 billion yearly.
The listed firm added that Macau Group and Sino will initially be infusing around P836.10 million into the project.
Around P234 million of that will then be poured into Calata, which in turn will invest the funds into its majority-owned corporate vehicle.
The remaining P602.10 million will be directly infused from Sino into Calata's majority-owned corporate vehicle, the local firm told the PSE.
After the announcement, shares of Calata ballooned by 28.16% to P3.55 each on Tuesday.
Look into agri-related deals
Calata said Mactan Leisure City will be just one of the many projects the firm and its partners will be handling.
Sino and Calata will be looking into agri-related projects and other related opportunities, as the US-based investment firm views the Philippine agriculture sector as a business opportunity.
According to Calata, Sino wants to invest in Philippine agriculture "not only to increase profitability, but also to stabilize regional food supply, and reduce door cost while providing fresh locally grown produce."


from:  Rappler (August 23, 2016)

Calata Partners with Investment, Gaming Firms for P65B Casino Resort in Cebu

Expected to be opened in 2020, the Mactan development will have 3 luxury hotels, an entertainment complex featuring a full-scale casino, and retail shopping.

GAME-CHANGER. Mactan Leisure City will introduce 3 luxury hotels, an entertainment complex featuring a full-scale casino, and retail shopping.

MANILA, Philippines – Listed agribusiness company Calata Corporation has partnered with a US-based investment group and a Macau-based gaming operator to create a real estate investment trust (REIT) for a P65-billion, 14-hectare casino resort on Mactan Island, Cebu.
Expected to be opened in 2020, the development will introduce 3 luxury hotels, an entertainment complex featuring a full-scale casino, and retail shopping.
REIT is a stock corporation created primarily for the purpose of owning income-generating real estate assets.
Calata told the Philippine Stock Exchange (PSE) on Tuesday, August 23, that it has teamed up with Sino-America Gaming Investment Group, LLC and Macau Resources Group Limited for the REIT that will be used for the 14-hectare casino resort called Mactan Leisure City.
Calata said in the regulatory filing that Mactan Leisure City will "generate tens of thousands of employment opportunities" and is expected to have a gross revenue of about P55.74 billion yearly.
The listed firm added that Macau Group and Sino will initially be infusing around P836.10 million into the project.
Around P234 million of that will then be poured into Calata, which in turn will invest the funds into its majority-owned corporate vehicle.
The remaining P602.10 million will be directly infused from Sino into Calata's majority-owned corporate vehicle, the local firm told the PSE.
After the announcement, shares of Calata ballooned by 28.16% to P3.55 each on Tuesday.
Look into agri-related deals
Calata said Mactan Leisure City will be just one of the many projects the firm and its partners will be handling.
Sino and Calata will be looking into agri-related projects and other related opportunities, as the US-based investment firm views the Philippine agriculture sector as a business opportunity.
According to Calata, Sino wants to invest in Philippine agriculture "not only to increase profitability, but also to stabilize regional food supply, and reduce door cost while providing fresh locally grown produce."


from:  Rappler (August 23, 2016)

Sunday, July 17, 2016

BIR Slashes Tax Clearance Requirements, Orders Frontline Offices to Issue CAR within Five Days


Heeding the call of the President of the Republic, the Bureau of Internal Revenue (BIR) begun its journey towards change through two (2) revenue issuances which effectively cuts down on red tape in the processing of Tax Clearance Certificates (TCC) and the issuance of Certificates Authorizing Registration (CAR).

Revenue Memorandum Circular (RMC) No. 74-2016 streamlines the requirements and the process in the issuance of TCCs required under Executive Order No. 398. The said issuance mandates that all TCCs shall be processed and released within two (2) working days from the submission of the complete documents. The number of documentary requirements was also reduced from nine (9) to three (3). 

Applicants now need only to submit a notarized application form with two (2) pieces of loose Executive Order No. 398
 (DST), Print-out of Certification Fee paid thru the BIR’s Electronic Filing and Payment System (eFPS) with payment confirmation, and Delinquency Verification issued by the concerned BIR office. 

The issuance further requires the issuance of the Delinquency Verification within twenty four (24) hours from the filing of the application by the taxpayer and shall have a validity period of one (1) month from the date of issue. 

The criteria for approving applications for TCC shall be governed by existing issuances which includes no unpaid Annual Registration Fee, no open valid “stop-filer” case, user of the eFPS for at least two (2) consecutive months prior to the application for TCC, not tagged as “Cannot Be Located” taxpayer, and no delinquent account. 

Revenue Memorandum Order (RMO) No. 41-2016 on the other hand mandates strict adherence to the BIR’s Citizen Charter and the provisions of Republic Act (RA) No. 9485, otherwise known as the Anti-Red Tape Act of 2007 (ARTA), in the processing and issuance of CARs. 

The said RMO reiterates the documentary requirements relative to applications for the issuance of CARs covering sale of real property, transfer or assignment of stocks not traded in the stock exchange, transfer subject top donor’s tax, estate tax, and other taxes including DST related to the sale/transfer of properties. 

It also pegs at five (5) days from the submission of the complete documentary requirements the number of days within which the CAR shall be issued in contrast to the previous time frame of five (5) to ten (10) days. Officials and employees found to have violated this directive shall be subject to the criminal and administrative penalties provided under the ARTA. 

The RMO responds to complaints raised by taxpayers of CARs issued well beyond the prescribed period. 




from:   BIR Media Release

Tuesday, July 12, 2016

Foreign Direct Investments Post Net Inflows of US$2.2 Billion in April; Reach US$3.5 Billion in the First Four Months of 2016


Foreign Direct Investments (FDI) posted net inflows of US$2.2 billion in April 2016 as net inflows were recorded across all FDI components. The surge in FDI inflows is reflective of the favorable investment climate as the economy continued to post strong growth and show even better growth potentials.   The bulk of the net inflows during the month was in the form of debt instruments (or lending by parent companies abroad to their local affiliates to fund existing operations and business expansion) which amounted to US$1.3 billion, more than four times the US$276 million recorded in the previous year.  Net equity capital placements amounted to US$825 million as gross equity capital placements increased significantly by 2044.1 percent to US$839 million from US$39 million, while withdrawals remained low at US$13 million.  Equity capital placements emanated largely from Japan, the United States, the Netherlands, Germany, and Taiwan.  These were channeled mainly to financial and insurance, real estate, manufacturing, wholesale and retail trade, and administrative and support service activities. Reinvestment of earnings by non-resident investors amounted to US$74 million during the month. 

As a result of these developments, FDI net inflows reached US$3.5 billion for the first four months of 2016.  In particular, non-residents’ investments in debt instruments more than doubled to US$1.9 billion from US$687 million last year. 

Net equity capital placements also grew by 372.6 percent to US$1.3 billion from US$279 million.  This was due mainly to the US$1.4 billion gross equity capital placements, which is four times the previous year’s level of US$369 million.  Equity capital placements came mostly from Japan, Hong Kong, Singapore, the United States, and Spain.  These were invested mainly in financial and insurance, construction, accommodation and food service, real estate and manufacturing activities.

Meanwhile, reinvestment of earnings amounted to US$255 million during the period. 

Based on the Balance of Payments and International Investment Position Manual, 6th edition (BPM6) which uses the asset and liability principle in the compilation of FDI statistics.  Under the asset and liability principle, claims of non-resident direct investment enterprises from resident direct investors are presented as reverse investment under net incurrence of liabilities/non-residents’ investments in the Philippines (previously presented in the Balance of Payments Manual, 5th edition (BPM5) as negative entry under assets/residents’ investments abroad).  Conversely, claims of resident direct investment enterprises from foreign direct investors are presented as reverse investment under net acquisition of financial assets/residents’ investments abroad (previously presented as negative entry under liabilities/non-residents’ investments in the Philippines). 

BSP statistics on FDI covers actual investment inflows, which could be in the form of equity capital, reinvestment of earnings, and borrowings between affiliates.  In contrast to investment data from other government sources, the BSP’s FDI data include investments where ownership by the foreign enterprise is at least 10 percent. Meanwhile, FDI data of Investment Promotion Agencies (IPAs) do not make use of the 10 percent threshold and include borrowings from foreign sources that are non-affiliates of the domestic company. Furthermore, the BSP’s FDI data are presented in net terms (i.e., equity capital placements less withdrawals), while the IPAs’ FDI do not account for equity withdrawals.





from:  Philippine Central Bank
          July 11, 2016