PPPs on track despite delays -- gov’t CONCERNS over the rollout of public-private partnership (PPP) projects have been downplayed by Cabinet officials, who nonetheless admitted that schedules for several deals had been pushed back.Secretary Cesar V. Purisima claimed that at least 10 projects -- out of an original list of 12 -- would be offered this year. "We are continually talking to investors. We can start at least 10 projects this year," he told BusinessWorld last week at the sidelines of a press briefing where he also said the government does not want to rush the implementation of the centerpiece infrastructure program. "We want to build a good, sustainable foundation. We don’t want our projects to be questioned and not stand scrutiny," Mr. Purisima said, bringing up the example of the Ninoy Aquino International Airport (NAIA) Terminal 3 project that began in 1997 but is still riddled with legal troubles and corruption allegations to this day. Public Works Secretary Rogelio L. Singson, for his part, said three of four PPP projects under his department would push through this year despite slight delays. He said the Public Works department briefed interested investors last Friday on the Daang Hari-South Luzon Expressway link and the NAIA expressway projects, priced at P1.6 billion and P10.59 billion, respectively. "We met with investors, contractors and bankers. It was a good crowd of about 100 people," he told BusinessWorld yesterday. Mr. Singson said the briefing gave investors a chance to raise comments about the general terms of reference of the two projects, adding that these views would be taken into consideration before final details are published. The National Economic and Development Authority still has to approve the Daang Hari and NAIA expressway projects -- a meeting on the matter is scheduled this week -- but Mr. Singson claimed that investors could look forward to the publication of invitation to bid within the first half of July. The government had initially promised to roll out the Daang Hari project in April and the NAIA expressway project in May. Two more projects -- the North Luzon-South Luzon expressway link estimated to cost P21 billion and the P10.5-billion Cavite-Laguna expressway -- will also be delayed, Mr. Singson said, with the former’s rollout to be pushed back to August from June and the latter to be offered next year instead of this December. PPP deals under the Transportation department could also be up for rollout changes. "The schedule of DoTC (Department of Transportation and Communications) PPP is being reviewed and updated. We’ll announce the updated schedule as soon as project preparations are firmed up," Undersecretary for Planning and Project Management Ruben S. Reinoso, Jr. said in a text message to BusinessWorld yesterday. The only PPP deal in a relatively advanced stage, the P15-billion four- to five-year maintenance and operations contract for the Light Rail Transit Line 1 and the Metro Rail Transit Line 3, has likewise been hit by delays. The government initially set a July 11 deadline for bid proposals but this was deferred to give incoming Transportation Secretary Manuel "Mar" A. Roxas II time to study the project contract. "The project was decided during the time of [outgoing Transportation Secretary Jose P. de Jesus]. [Mr. Roxas] may want a different approach, so we will give him room," Mr. Purisima said. |
U.S. Stocks Advance After Regulators Issue New Banking Rules U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for the first time in four days, after regulators issued new capital rules to safeguard the global financial system, offsetting an unexpected stagnation in American consumer spending.Apple Inc. (AAPL) rose 1 percent after Morgan Stanley said the company’s order cuts will ease and production of iPhones and iPads will begin “ramping aggressively.” Stanley Black & Decker Inc. (SWK) gained 1.4 percent after the tool company offered to buy Sweden’s Niscayah AB for $1.2 billion. DuPont Co. and Alcoa Inc. (AA) fell, and the S&P GSCI Index of 24 commodities sank to the lowest level since January as oil and metals prices fell. The S&P 500 rose 0.4 percent to 1,273.88 at 9:53 a.m. in New York. The Dow Jones Industrial Average gained 66.49 points, or 0.6 percent, to 12,001.07. Treasuries Drop as Record Low Yield Saps Demand at Two-Year Note Auction Treasury two-year note yields increased the most since April as speculation Greece’s lawmakers will approve austerity measures reduced demand at the U.S. government’s $35 billion auction of the securities. Indirect bidders, an investor class that includes foreign central banks, purchased 22 percent of the notes, the lowest in more than three years. Thirty-year bonds were the worst performing Treasuries, increasing the difference in yields with two-year securities to the widest since March. “A lot of people weren’t prepared for a bad two-year auction,” said Michael Franzese, managing director and head of Treasury trading at Wunderlich Securities Inc. in New York. “Now it’s all hands on deck for tomorrow to see if we’re going to get hit again with a bad five-year note auction. I guess rates really do matter to the average investor.” Yields on current two-year notes gained seven basis points, or 0.07 percentage point, to 0.39 percent at 5:20 p.m. in New York, according to Bloomberg Bond Trader prices. The 0.5 percent security maturing in May 2013 fell 1/8, or $1.25 per $1,000 face amount, to 100 6/32. The two-year note yields advanced the most on an intraday basis since April 27, when the Federal Reserve said it would complete its $600 billion program of debt buying on schedule at the end of June. The yields fell on June 24 to 0.32 percent, the lowest level since Nov. 4, the day after the central bank said it would resume buying debt. |
Crude Oil Rises From Four-Month Low in New York on U.S. Economic Outlook Oil rose in New York as speculation the U.S. economic recovery is on track prompted investors to buy contracts after prices fell to the lowest in four months.Futures climbed as much as 0.9 percent before a report today that may show a rebound in consumer confidence in the U.S., the world’s biggest oil consumer. Prices yesterday slid after Commerce Department data showed consumer spending stagnated in May. “I’m not really worried about demand growth,” said Tetsu Emori, a commodity-fund manager at Astmax Ltd. in Tokyo. “Ninety-dollars seems to be quite firm support at the moment and current fundamentals make selling below $90 too risky.” Crude for August delivery rose as much as 80 cents to $91.41 a barrel in electronic trading on the New York Mercantile Exchange. It was at $91.30 at 7:52 a.m. Singapore time. Yesterday, the contract fell 0.6 percent to $90.61, the lowest settlement since Feb. 18. Futures have gained 17 percent in the past year. The Conference Board’s index of U.S. consumer confidence, scheduled for release today at 10 a.m. in New York, will climb to 61 in June from 60.8 in May, which was the lowest in half a year, based on the median estimate of 69 economists surveyed by Bloomberg News. |
Sources: Bloomberg, Reuters, www.inquirer.net, www.philstar.com, www.bworldonline.com, www.cnnmoney.com
BDO UNIBANK INC.
Jonathan Ravelas
Chief Market Strategist
(632) 858-3145
Rhys Cruz
Junior Researcher
(632) 858-3001
