The stock market picked up right where it left off before the long holiday break, finishing with another record high on the first trading day of 2018. The peso likewise started 2018 on a positive note, gaining 12 centavos to close at its strongest level in six months on the back of strong dollar inflows, particularly remittances from overseas Filipinos. 1

 “The back-to-back closing at new record highs on the first trading day of 2018 and last trading day of 2017 is an auspicious sign for our stock market. Investor confidence and optimism were very apparent in today’s trading and we hope our market will remain robust for most of the year,” said PSE president Ramon Monzon. 2

“We anticipate an exciting 2018 for the local market given the plans we have set for the Exchange. We look forward to the launch of new products and services that should make our market more robust and attractive to both foreign and local investors,” PSE President and CEO Ramon S. Monzon said. 3




Stronger exports and better government spending were the top contributors to the 6.9-percent growth of the Philippine economy in the third quarter, according to Socioeconomic Planning Secretary Ernesto Pernia. The third-quarter gross domestic product (GDP) growth rate is up from the 6.7 percent recorded in the second quarter, which the government had originally pegged at 6.5 percent.1

The Philippine economy has “anchors of stability” that will keep it afloat despite emerging risks, Bangko Sentral ng Pilipinas (BSP) Governor Nestor A. Espenilla Jr. said yesterday. But as a whole, Espenilla said, the Philippines was able to sustain robust macroeconomic fundamentals, such that prospects remained bright and growth would be strong on expectations that both government and private sector investments would rise. 2

The Philippines is emerging as one of this decade’s economic stars with the World Bank predicting growth of more than 6 percent until 2019, underpinned by an ambitious infrastructure building program and a young and growing population. Finance Secretary Carlos Dominguez on Thursday said he expects faster growth in the succeeding quarters, while the central bank Governor Nestor Espenilla said there are no signs of overheating in the economy. 3



The Philippine government gears up for the upcoming 31st ASEAN Summit. The ASEAN is composed of 10 member nations (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam). It was formed to promote a community focused on economic, political-security & socio cultural relations among its member nations together with its allies. [1]

The 31st summit will be attended by 19 world leaders and thousands of delegates from the 10 Southeast Asian nations and 10 other dialogue partners including the US President Donald Trump. [2]

Malacanang Palace previously declared Nov. 13 – 15, 2017 as special Non-working Holidays (link to JMC article). This is hoped to decongest Metro Manila Traffic for the duration of the Summit.


Malacanang declared special nonworking days in Metro Manila, Bulacan and Pampanga from Nov 13 – 15, 2017 (Monday to Wednesday) by virtue of Proclamation No. 332 for the 31st ASEAN Summit and Related Summits. Various activities will be held in the National Capital Region (Metro Manila) and Clark Field Pampanga affecting these areas.

Remaining national holidays for 2017:


2018 Philippine Public Holidays

President Rodrigo Duterte signed Proclamation No. 269, declaring the following public holidays for 2018.

The proposed latest version of the Foreign Investment Negative List (FINL) has been submitted to the Office of the President for review. National Economic Development Director General Ernesto M. Pernia expressed optimism in the release of the FINL before the year ends. The proposed aggressive changes were designed so that the Philippines will be at par with the rest of the ASEAN countries. Once signed through an Executive Order, it will be the 11th FINL following the 10th version released during the Aquino Administration.  [1]

Perceived to be the most liberal by far, it has among its provisions the removal of restrictions on foreign-owned investments houses and financial activities in line with the liberalization of the banking sector, practice of professions, foreign infrastructure contractors and lowering the paid-up capital requirement for foreign retailers from $2.5 million to $ 200,000. Public Utilities (telecommunication & water) are expected to have an increased cap on foreign ownership to 70%. [2]  The Philippines has restrictions over ownership of its public utilities up to 40%. [3]  Increasing its cap will require amendment of the old Commonwealth Act No. 146 commonly called the Public Service Act. A bill geared towards its repeal is already filed in the Philippine congress.  [4]

Other areas identified in the Technical Working Group (TWG) report are:

Mass media, supplies to state-owned corporations and agencies as well as bath houses and massage clinics. The government is also looking at allowing foreign pharmacists and forestry to practice their professions in the country, as long as it is under a reciprocity system.

The government may also ease the restrictions on education by limiting the 40 percent foreign equity rule only to basic education. The TWG also recommended that high-level skills development be opened to foreign players.

On mass media, the government is considering the easing of the foreign equity limitations imposed on marketing and advertising through the Internet.

Contracts for the supply of materials, goods and commodities to government-owned or controlled corporation, company, agency or Municipal Corporation are also considered for removal from the list, but also on a reciprocity basis.

Lastly, the TWG has recommended to the Department of Health to classify sauna and steam bathhouses, massage clinics and other like activities under “wellness centers” to allow full foreign ownership. [5]

The 10th FINL mandated no foreign equity for the following: Mass media, except recording; practice of professions in the pharmacy, radiologic and x-ray technology, criminology, forestry and law sectors; retail trade enterprises with paid-up capital of less than $2.5 million; cooperatives; private security agencies; small-scale mining; utilization of marine resources in archipelagic waters, territorial sea and exclusive economic zone as well as small-scale utilization of natural resources in rivers, lakes, bays and lagoons; ownership, operation and management of cockpits; manufacture, repair, stockpiling and/or distribution of nuclear weapons; manufacture, repair, stockpiling and/or distribution of biological, chemical and radiological weapons and anti-personnel mines; as well as manufacture of firecrackers and other pyrotechnic devices. [6]

The 11th FINL will not only open its local industries to non-Filipino investor. It will also take the path towards a complete liberalized Philippines. [7]

The FINL is a shortlist of investment areas of activities which may be opened to foreign investors and/or reserved to Filipino nationals. The basic law that governs it is governed by the Foreign Investment Act of 1991. [8]






[4] Ibid, Philstar



[7] Ibid, Pressreader


The Philippine Bureau of Internal Revenue (BIR) removed the Tax Treaty Application (TTRA) for nonresident corporations availing the preferential withholding tax rates on dividends, interests & royalties earned from within the Philippines. Commissioner Caesar Dulay signed on 28 March 2017 Revenue Memorandum Order (RMO) 8 – 2017, effectively repealing RMO 7-2010 and all previous memos pertaining to dividends, interests & royalties. It has taken effect on 26 June 2017, 90 days after its signing[1].

Prior to RMO 8-2017, nonresident foreign corporations are required to file their Tax Treaty Relief Application (TTRA) at the International Tax Affairs Division (ITAD) of the BIR before they can avail of preferential withholding tax rates on dividends, interests, royalties, among other business profits. The complete mandatory requirements are set out in RMO 72-2010[2]. This set of requirements have long been perceived onerous by various stakeholders taking months – even a few years to complete[3].  The Philippines is a signatory to over 40 international tax treaties. Without an approved TTRA income payments from dividends, interest and royalties are subject to regular income tax rate at 30% in contrast to as low as 15% upon approval of the TTRA[4].

RMO 8-2017 prescribes the outright enjoyment of preferential treaty rates for nonresident foreign corporation income on dividends, interest and royalties (DIR) subject to post reporting validation. This is after subscribing to and submission of the new BIR Form Certificate of Resident for Tax Treaty (CORTT) (see annex 1). CORTT replaced the old 1901 Forms for DIR.  It has two parts. Part 1 is for the nonresident entity to complete, to be signed by the competent Tax Authority of their country of residence. Nonresidents can also use the prescribed certificate of residency of their country but they will still have to submit the first part for monitoring purposes. Part II of the CORTT form is for the payor of the income to complete. It indicates the nature of income payments, amount and amount withheld[5].

While its enjoyment is outright, the benefit is subject to the compliance of both the income recipient and the income payor of the DIR. Incomplete, erroneous or misleading compliance of the CORTT of either party, and non-compliance of the 1604-F and 1604 CF by the payor of income, will invalidate the preferential rate, and the noncompliance will be subject to penalties as prescribed by the Philippine Tax Code[6].

The new RMO is in keeping with the Philippine government’s drive to improve Ease of Doing Business (EOBD). The Philippines is currently 99th among 190 countries per survey of World bank[7].

[6] ibid

President Rodrigo R. Duterte on Tuesday met some of the country’s tycoons over dinner in Malacañang in a bid to address “uncertainties” troubling them, his spokesman said yesterday.


The meeting comes in the wake of mounting reports of increased investor worries caused by political noise generated by his tough talk against the West and his administration’s apparent preoccupation with countering a nascent opposition.

In a press briefing, Presidential Spokesperson Ernesto C. Abella said Mr. Duterte’s three-hour meeting with big businessmen involved an “open discussion” on topics such as shift to a federal government, contractualization, job creation and tax reform.

“The president reiterated that he is for job creation to uplift the people’s well-being,” Mr. Abella said, adding that the meeting was called to “bring them on board the government’s agenda of inclusive growth.”

Quoting Presidential Adviser (PA) for Entrepreneurship Jose Ma. “Joey” A. Concepcion III, who facilitated the dinner meeting, Mr. Abella also claimed the tycoons “walked out extremely happy.”

“As far as PA Joey was saying, their preconceptions regarding the President were settled because of their one-on-one, face-to-face conversation. Many of them apparently had never met the President. This is the first time they had face-to-face and according to PA Joey, a number of their uncertainties were settled,” the spokesman said.

“Mainly, they were there to show their support for improvement of areas on poverty and crisis and the conflicts,” he also said.

Read more

THE PHILIPPINES remains a viable destination for foreign investors as fiscal and economic policies remain intact despite political risks, international credit raters said, noting that an unblemished growth story should sustain optimism.

Credit analysts from S&P Global Ratings and Moody’s Investors Service yesterday said the Philippine economy is poised to remain upbeat despite political risks stemming largely from the “unconventional” ways of President Rodrigo R. Duterte and heightened global uncertainty.

“It’s true that perceptions of political risks have increased in the Philippines mainly because the current President is a relatively unconventional political figure by Philippine standards. For quite a while he’s been making public remarks that have raised concerns of certain people, particularly in his public announcement that he’s going to distance the Philippines from the US, its traditional ally,” analyst Kim Eng Tan said in an S&P webcast.

“On the other hand, while he has been making all these pronouncements publicly, we have not seen significant changes in macroeconomic policies in the country and we haven’t seen domestic policies turning more negative for foreign investors.”

The Philippines may even turn out to be a more palatable investment destination amid easing tensions with China under Mr. Duterte’s presidency, coupled with sustained economic policies and reforms.

Read more at B World Online…

7.1 Philippine Economic Growth

The Philippine economy expanded 7.1 percent in the first three months in office of President Duterte on the back of robust public infrastructure spending and private construction, and growth in agriculture.

An upbeat consumer spending, encouraged by low inflation and low interest rates, also drove the expansion during the July-September period of the gross domestic product (GDP) that made the Philippines the fastest growing economy in the region. GDP is the total value of goods produced and services rendered in a given period.

“We are the fastest growing among major Asian emerging economies that have already released data for the quarter. We are higher than China’s 6.7 percent, Vietnam’s 6.4 percent, Indonesia’s 5.0 percent and Malaysia’s 4.3 percent. India has not yet released their data,” said National Economic and Development Authority Director Reynaldo Cancio.

The first three quarters saw 7% growth, compared to the 5.7% clocked in 2015’s comparable period. Mr. Cancio said the country needs to grow this quarter by at least 3.4% to reach the 6% lower end of the full-year target, and by 6.9% to reach the 7% higher end.

In the same briefing, NEDA Deputy Director General and Undersecretary for Policy and Planning Rosemarie G. Edillon said the government is “hoping” the business process outsourcing sector will remain another pillar of growth despite the America-first policy of US President-elect Donald J. Trump.

“I think we should congratulate the administration because it’s (GDP growth) devoid of election spending in the third quarter. I think it’s sustainable because it’s a big thing to surpass a GDP that has an election spending,” Sergio R. Ortiz-Luis, Jr., honorary chairman of the Philippine Chamber for Commerce and Industry, said in a telephone interview.

“We are hopeful that the trajectory of our country’s growth will remain high in the face of the challenges ahead of us. The government and the private sector have to take every opportunity that this growth brings to improve the lives of our countrymen, especially to eliminate poverty and create quality jobs and entrepreneurial opportunities. We have to empower more Filipinos, especially the marginalized groups, to participate in and benefit from the development process. This will result in genuine inclusive growth for our nation. “said Director Cancio.


Excerpts taken from:


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