This is a monthly briefer prepared by DIT Manila to provide insights into how the Philippines is responding to and managing the impact of COVID. It also captures relevant news and developments that will support UK companies’ assessment of live and potential opportunities, as a subject for further engagement and useful support from the DIT team where possible.

COVID-19

As of August 05, the Philippines’ total number of COVID-19 cases is at 115,980. Active cases stand at 47,587 with 91.4% considered as mild. The total reported deaths stand at 2,123 (Updates here). Numbers have more than doubled since the last bulletin. More than 10% of tests each day yield positive cases and the share of severe and critical cases also increased to more than 1%. To add, the Department of Health recently began counting mild and asymptomatic cases as “recoveries” after completing 14-day isolations from the time they first show symptoms or have samples collected for testing (More here). Mass testing and contract tracing measures remain lacking.

Nationwide lockdown measures began easing at varying levels in June. The strictest restrictions were reimposed on Cebu City in July after a surge in cases, but these were downgraded to general restrictions in August (More here).

International flights resumed July 8 but have been prone to cancellation and diversions to local airports because of limited operating capacity and quarantine requirements. From August 1, foreign nationals with long-term visas are now allowed to enter the country and GOV.UK has also updated related Travel Advice (More here and here).

National Capital Region: Lockdown Returns

On July 31, President Duterte upheld general restrictions all over the Philippines. However, an outcry from over 80 medical groups called for re-imposing stricter restrictions on NCR as cases continue to rise, hospitals lose capacity, and health workers tire out. President Duterte heeded these, and he declared a return to Modified Enhanced Community Quarantine (MECQ) – the second- strictest lockdown level – over NCR and the surrounding area, effective August 4. The rest of the country remains under general restrictions (More here and here).

The latest lockdown on NCR and surrounding cities – accounting for two-thirds of the Philippine economy – may throw off economic recovery forecasts. Previous socio-economic measures in the lockdown of March-May, such as cash handouts, small business wage subsidies, and rent freezes, ended in June. The risks are higher for business closures and unemployment. Further, the return of checkpoints and ban on public transport may hamper logistics by delaying the movement of both deliveries and people – as experienced in the previous lockdown. Of note, the government’s recovery plan emphasizes infrastructure spending, but this sector is closed anew except for essential projects. However, the Bangko Sentral ng Pilipinas (BSP) still maintains that recovery will be shaped like a hockey stick despite the reimposition of MECQ. The indicative end of MECQ is on August 18, but this will be subject to government review (More here and here).

Business Opportunity Outlook

Some relevant news and developments below provide a snapshot of the market and potential opportunities moving forward.

Launch of Business Support Campaign by Board of Investments. The BOI has launched a dedicated website aimed at helping businesses and investors through the pandemic. The resources include guidance on doing business across quarantine zones, advice on special investment incentives, and links to various government agencies. The website also offers bookings with BOI Investment Specialists and subscribing to the BOI newsletter. This project is a result of support by DIT Manila through its Investment Promotion Program (More here).

The Need for Digital Transactions. In his recent State of the Nation Address, President Duterte reiterated the need to prioritise the digitalisation of government services to better transition into the “new normal” and minimise red tape (More here). He also stressed that the government should build trust and confidence in online transactions, stronger online consumer protection and enabling measures for online businesses, which is also in line with House Bill 6122 or the ‘Internet Transactions Act’ aimed at promoting the development of e-commerce in the country.

Digital Infrastructure Opportunities Advance. The Department of Information and Communications Technology is proposing a P13.49 billion (£210 million) budget to implement the national broadband program next year to enhance digital infrastructures for faster and more accessible internet connectivity (More here). Meanwhile, The Philippine Customs Modernization Project, which would be partly financed by the World Bank, will be implemented by the Bureau of Customs to automate processes and improve systems ICT systems and equipment (More here).

COVID Prompting Investment in Education. COVID forced both the private and public education sectors to look at alternative solutions as platforms for delivery. In the recent State of the Nation Address, President Duterte highlighted the implementation of a Public Education Network that will connect public schools and the Department of Education offices nationwide by 2022. The government will also enhance capability for online learning, modular learning, and TV-radio based broadcast and development of related content, including distance learning. An additional priority, and among the 21 announced priority bills, is the Advanced Nursing Education Act (More here and here).

Philippine Renewable Energy Developer Goes Regional. AC Energy, the power subsidiary of the Ayala Group, announced the development of a 210MW Wind Farm in Vietnam, bringing the group’s renewable energy portfolio to 1,200MW. The Quang Binh Wind Farm will have two project phases consisting of 109.2MW and 100.8MW. It is expected to be commissioned in Q3 of 2021. Vestas will supply, transport, install and commission the wind turbines for the project (More here).

Keeping Rail Projects on Track. Despite the inevitable pause on construction works and infrastructure projects, the government with support from the Asian Development Bank (ADB), continues to move key rail projects forward. This includes ADB tenders for the advisory works for the MRT-4 project, as well as the Department of Transport’s (DOTr) contracting of civil works contracts by the Department of for the Malolos-Clark Railway project (More here and here).

National Budget for 2021 Approved. President Duterte recently approved the Php4.506 trillion (£70 billion) budget for 2021. The proposed budget will focus on policies, programmes, and projects that will improve the healthcare system, ensure food security, increase investments in public and digital infrastructure and help communities and affected sectors cope with the ongoing pandemic (More here).

Upcoming Events

The following is a selection of events organised by DIT Manila and its partner organisations.

Transport Forum by the Asian Development Bank (24-28 August)

Join ADB’s premiere gathering of experts, government counterparts, and stakeholders to discuss the region’s transport issues, the applied and potential solutions to these issues, and the future of the sector. The week will be a series of free webinars for participants (Join here).

Webinar on DIT Asia Pacific’s Response to COVID-19 by British Expertise International (1 September)

Join BEI for a conversion with Natalie Black, Her Majesty’s Trade Commissioner for Asia-Pacific, to share DIT’s response to COVID-19 and how the UK government is supporting business in Northeast Asia, Southeast Asia, and Australasia (Join here).

Business Opportunities in the Asian Development Bank (9, 15, & 24 September)

The DIT is organising a virtual ADB Business Opportunities Seminar (BOS) for the UK. A panel of ADB experts will share insights and present updates on ADB procurement opportunities. The three-part webinar series is scheduled as follows:

• Infrastructure (9 September 2020) (Join here)
• Urban Planning & Natural Resources (15 September 2020) (Join here)
• Social Development (24 September 2020) (Join here)

For more information, you may contact Victoria Sibal (Victoria.Sibal@fco.gov.uk).

Contact

Richard Colley
Director for Trade & Investment
Richard.Colley@fco.gov.uk

Ianela Ortiz
Education and ADB
Ianela.Ortiz@fco.gov.uk

Emma Leister
Technology & Healthcare
Emma.Leister@fco.gov.uk

Rachel Gancia
Infrastructure & Defence
Rachel.Gancia@fco.gov.uk

To download and read the original bulletin document from the Department for International Trade please click the link below.