ON GENERAL PROPERTY
The foreign direct investment (FDI) restrictiveness ranking of the Philippines may depend on the passage of future laws as the economy slowly opens up. Based on last year’s data, out of 83 economies on the FDI Regulatory Restrictiveness Index, the country ranked third most restrictive with a score of 0.374.
According to Trade Secretary Ramon M. Lopez, they are relying on meaningful amendments and improvements to the Retail Trade Liberalization Act (RTLA), Public Service Act (PSA), and Foreign Investments Act (FIA), which were certified by the president as urgent.
British Chamber of Commerce of the Philippines Executive Director Chris Nelson shares that there is currently a greater need to increase foreign direct investment, especially since the economy is under more pressure than before due to the pandemic.
Based on the data released by Bangko Sentral ng Pilipinas (BSP), FDI inflows fell by 25.4% Y-o-Y to $429 in May. However, despite this decrease, the FDI net inflows jumped to 37.8% to $3.48B in the first half of 2021.
ON INDUSTRIAL
Jollibee Foods Corp. finalizes a Php 3.97B deal with DoubleDragon Properties Corp. for common shares of CentralHub Industrial Centers Inc. in exchange for 16.4 hectares of industrial properties. This deal expands the total industrial land portfolio of CentralHub to 39.8 hectares, which includes the largest operating commissary of Jollibee.
According to DoubleDragon chair Edgar Sia II, this partnership will bring many benefits to both sides, but most importantly, this will accelerate CentralHub to becoming “the first and largest industrial real estate investment trust (REIT) in the Philippine Stock Exchange.”
With the REIT structure, CentralHub will be able to put up more industrial warehousing facilities across the country by recycling capital.
ON OFFICE
The IT and Business Process Association of the Philippines (IBPAP) considers new policy interventions and strategies in creating their industry Roadmap 2028 as their current 6-year Roadmap 2022 comes to a near close.
IBPAP President and CEO Rey Untal cites that there is a need for a policy intervention from the government towards a longer term work arrangement, given that with the current and future state of the industry, BPO firms will no longer need to locate in one physical location.
It is about time to craft more longer term policies with the government to figure out an arrangement that will work, as shared by Untal. The old model will not be able to sustain the industry as the pandemic continues to transform the overall landscape for various industries.
As based on the 6-year Roadmap 2022, IBPAP targets $38.9 B worth of generated revenue or 9.2 percent compounded annual growth rate. As for employment, the industry expects 1.8M full time employment by 2022.
ON RESIDENTIAL
Federacion Internationale des Administrateurs de Biens Conceils et Immobiliers (Fiabci), a Paris-based global real estate association, cites that the country’s property industry will rebound by September.
Based on their survey across 226 cities around the world, there are expected uptrends in property prices in Metro Manila. For the month of September it will be for agricultural land and detached houses. For November, it would be for low-rise residences. Lastly, for December, it would be for residential subdivisions.
For 2022, the prices for the following are expected to bounce back: “housing and apartment rentals in January; urban lands and industrial properties in February; shopping outlets and resorts in May; office spaces in June; and hotels and retirement facilities in August.”
ON TOURISM
The Department of Tourism is pushing for the pursuance of sustainability for tourism businesses even amidst the ongoing pandemic. DOT Secretary Bernadette Romulo-Puyat states that sustainability will be crucial in the future of the tourism industry as it will contribute to making the industry more resilient and “pandemic-proof.”
Included in DOT’s initiatives in promoting sustainable tourism are: the ANAHAW Philippine Sustainable Tourism Certification that aims to improve the efficiency of tourism establishments; the Sustainable Diner Program that seeks “to develop and harness sustainable consumption and production strategies by assisting the food service sector in transitioning into a low carbon industry;” and Save Our Spots (SOS) campaign done by the department “to inspire the public, businesses, and communities to have a long-term view of responsible tourism.”
Secretary Puyat also shared that DOT has been recalibrating their tourism products and developing new tourism circuits to adapt to the ever changing travel preferences of tourists, especially during this pandemic.
ON RETAIL
Growth in the retail industry is said to be seen by 2023 as strict restrictions are back in place for the country’s second round of lockdown. It was projected by the Philippines Retailers Association that the industry’s recovery would most likely happen in 2022 as opposed to the supposedly projected recovery this year.
Most retailers have been using their stores as fulfillment centers for their online sales, PRA President Rosemarie B. Ong shared. However, this is not enough to cover costs of operating in malls. With quarantines still in place, foot traffic in malls were down by 50- 60%, and even more so when lockdowns were in place.
Expected sales for the remainder of the year are expected to remain flat since there is no certainty as to when operations will go back to normal. Recovery of the retail industry may hardly be in sight especially if vaccinations cannot be accelerated from its current levels.
Sources
Abad, R. (2021, August 17). Real-estate market to start recovery in September: Roderick Abad. Retrieved September 06, 2021, from https://businessmirror.com.ph/2021/08/17/real-estate-market-to-start-recovery-in-september/
Cahiles-Magkilat, B. (2021, August 08). IBPAP mulls ROADMAP 2028. Retrieved September 06, 2021, from https://mb.com.ph/2021/08/09/ibpap-mulls-roadmap-2028/
Cordero, C., Jr. (2021, September 2). PHILIPPINE PROPERTY MARKET NEWS - AUGUST 2021 (Rep.). Retrieved September 6, 2021, from Cushman & Wakefield website: https://www.cushmanwakefield.com/en/philippines/insights/philippine-property-market-news-august-2021
Dumlao-Abadilla, D. (2021, August 21). DoubleDragon, Jollibee seal P4-B deal in prelude to INDUSTRIAL Reit listing. Retrieved September 06, 2021, from https://business.inquirer.net/329357/doubledragon-jollibee-seal-p4-b-deal-in-prelude-to-industrial-reit-listing
Ibañez, J. (2021, August 09). Retail industry pushes back recovery projections. Retrieved September 06, 2021, from https://www.bworldonline.com/retail-industry-pushes-back-recovery-projections/
Ibañez, J. (2021, August 25). Passage of Key bills to ease fdi restrictiveness. Retrieved September 06, 2021, from https://www.bworldonline.com/passage-of-key-bills-to-ease-fdi-restrictiveness/
San Juan, A. (2021, August 19). Puyat: Sustainability is key in tourism industry's recovery. Retrieved September 06, 2021, from https://mb.com.ph/2021/08/19/puyat-sustainability-is-key-in-tourism-industrys-recovery/