Philippine Asian News Today Vol 21 No 4 | Page 12

BUSINESS NEWS 12 Cheaper air fares loom Philippine Airlines and Cebu Pa- cific Inc. are set to lower their ticket prices this summer following the drop in fuel surcharge. The Civil Aeronautics Board (CAB) said in an advisory on Febru- ary 15 fuel surcharge for domestic and international flights will go down from level 3 to level 2 for the period of March 1 to April 30, 2019. As required by the CAB, PAL and CEB last week had filed separate applications to impose lower fuel sur- charge. CAB said from December 2018 to January 2019, the price of jet fuel average to $73.50 per barrel with the US exchange rate of P52.60 to the dollar for the same period. This is equivalent to P24.32 per liter which corresponds to level 2 of the passen- ger fuel surcharge matrix. Based on CAB’s fuel surcharge matrix, level 2 fuel surcharge per pas- senger per way for flights in the Phil- ippines ranges from P45 to P171 for domestic and P218 to P2,076 for in- ternational. Level 3 fuel surcharge being imposed until this week by airlines ranges from P74 to P291 for domes- tic flights per passenger per way and for international flights, from P381 to P3,632. The fuel surcharge matrix is pub- PNT Foreign Exchange $1.00 Cdn = P 39.41 Php $1.00 US = P 51.79 €1.00 EUR = P 58.92 lished by the CAB every 12 months and is revised as necessary. Surcharges are suspended once the average price of jet fuel falls below P21 per liter. The applicable fuel surcharge is determined based on the two-month average of Mean of Platts prices in jet fuel in its peso per liter equivalent, and is fixed for two months. The applicable fuel surcharge is evaluated every two months. The jet fuel cost is the largest expense by an airline operator. Volatility in fuel costs culminat- ing in recent price spikes prompted airlines to adopt two actions: in- creased revenues by applying fuel surcharges and ironed out volatil- ity by adopting increasingly complex hedging mechanisms. Fuel surcharge helps airlines offset part of their operating cost in which fuel bills contribute the most. (Malaya) SSS eyes overseas investments this year The Social Security System (SSS) is eyeing to actively invest over- seas this year, with the newly-signed Social Security Act of 2018 enabling the pension fund to double its allowed asset allocations abroad. Emmanuel Dooc, SSS presi- dent and chief executive officer, said the pension fund could previously al- locate only 7.5 percent of its invest- ible funds overseas. The new law has increased this to 15 percent. However, the pension fund does not have any international investments even though it is allowed to invest a certain percentage abroad. “We have not been doing that because of lack of expertise, so we will be engaging, hopefully, fund man- agers and advisers. That is one thing that we have to do in order to diversify and also to get a higher yield,” Dooc said. The SSS had previously men- PHILIPPINE ASIAN NEWS TODAY February 16 - 28, 2019 tioned it was looking into the possi- bility of investing overseas to diversify its portfolio and to take advantage of possible good returns abroad, but its plans have yet to push through. The charter amendment redis- tributed investment ceilings which al- lowed the pension fund to set aside a bigger percentage of its investments in specific areas that are currently be- ing limited. Dooc said the new law gives the commission more flexibility in pursu- ing certain investment processes. “Yes, (we have plans to invest abroad) because the asset alloca- tion for foreign investments has been doubled. So that will translate to P75 billion. Under the old law... the maxi- mum amount is around P37.5 bil- lion,” Dooc said. “If we can get a better yield, why not? And (if it will provide) stability and diversification. I will constitute a D1.00 BHD= P 137.39 R1.00 SAR = P 13.81 ¥1.00 JPY= P 0.47 study group to do that (to check if it is a good time to invest abroad), and we’ll be engaging consultants and experts. There are many consultants who are offering their services. So what we will do is to accredit or bid it out,” he added. Dooc said the SSS also plans to hold on to its properties and develop them to provide the pension fund with a steady stream of income over the years, to match its long-term obliga- tions. “What we are doing is, we want to bid them out either as a joint ven- ture or as a long-term lease so we can benefit from utilizing these proper- ties,” he said. Dooc said he is hopeful the pension fund’s return-of-investment will hit seven percent in 2020, and by 2022, nine percent. In June last year, the pen- sion fund invested P1 billion each in PhilEquity Fund Inc. as managed by Philequity Management Inc.; Sun Life of Canada Prosperity Balanced Fund Inc. as managed by Sunlife As- set Management Company Inc.; and Philippine Stock Index Fund Corp. as managed by BPI Investment Manage- ment Inc. It was the first time in 61 years that the pension fund invested in mu- tual funds. Dooc said SSS has also chosen nine local fund managers who will each manage a P1-billion fund. (Ma- laya) PLDT moves to improve gov’t hotline after Duterte complaint PLDT Inc said Tuesday it was taking steps to “improve” the govern- ment’s 8888 public complaints hot- line after President Rodrigo Duterte complained that it was inaccessible at times. Speaking in Cebuano during a campaign sortie in Cebu City last Sunday, Duterte said could shut PLDT unless the telco took action. “Dili kaya sa present setup. Sige busy. Ingnang PLDT. Og dili, sila may akong sirhan. [laughter] Oo. Tinuod na. Di lang ko gustong manghambog. Naay utang sa gobyerno eight billion. Sukad pa na niadto. Way presidente nakapaningil... “ Duterte said. (The present setup can’t ac- commodate all the calls. It’s always busy. Tell PLDT. If not, I’ll shut down their business. Oo, that’s true. I don’t want to brag, but they owe govern- ment eight billion. No President has ever asked for payment) Responding to the President’s remarks, PLDT spokesman Ramon Isberto said: “We are currently tak- WWW.PHILIPPINEASIANNEWSTODAY.COM ing steps to address the concern ex- pressed by the President to improve the public’s access to the Citizen’s Complaint Center 8888 hotline num- ber.” Shares of PLDT were down 1.35 percent late on Tuesday compared to a 0.4-percent advance in the main in- dex. (abs-cbn news)