January deficit expected
THE GOVERNMENT likely posted a deficit in January as it sought to jump-start projects before the onset of the rainy season."Most likely we had a deficit because we are frontloading our expenses to take advantage of the good weather months," Budget Secretary Florencio B. Abad told BusinessWorld yesterday. He did not cite figures, however, saying the government will detail its fiscal performance for the start of the year later this month. Finance Secretary Cesar V. Purisima, meanwhile, told reporters that expenditures for January were higher than the P129.4 billion recorded 12 months earlier. But revenues came in strongly as well, he claimed, as the Bureau of Customs collected more than its P20-billion goal for January. The Bureau of Internal Revenue (BIR) has said it managed to exceed its January 2010 take of P64 billion but did not detail if its P71.9-billion target for last month was met. "Revenues are good. Customs is on target and I think BIR is doing good," Mr. Purisima said without elaborating. State firms also paid dividends totaling P30 billion, higher than their quota. Finance Undersecretary Gil S. Beltran, in a telephone interview, said the government may have incurred a January deficit "within the neighborhood of P37-38 billion," about the same as the P37.1-billion deficit recorded in the same month last year. "I do not have the data right now but the past administration also frontloaded [expenses] last year because [then President Gloria Macapagal] Arroyo wanted to finish her projects before leaving office," Mr. Beltran said. Disbursements last month, Mr. Abad said, included P717 million released to agencies to finance capital outlays, maintenance and operations, and to pay salaries. Frontloading will continue until June, Mr. Abad said, which will likely result in a "higher deficit" in the first semester that will be offset with "lower shortfalls" in the second half. "For instance, we may accommodate a [deficit] total of P190 billion for the first semester and then have only P100 billion for the latter part," he said. Mr. Purisima also stressed that the government would stick to its P290-billion deficit ceiling for the year, which is equivalent to 3.2% of gross domestic product (GDP). "We will keep that target and we will meet that. There’s no need to worry because what we are doing is we are frontloading expenses unlike before when we used to divide them on a monthly basis," he said. The Aquino government likely incurred a deficit of P309.8 billion -- corresponding to 3.6% of GDP -- last year based on initial figures, well below a P325-billion cap. -- P. P. Magtulis
Manila is 59th most expensive city for expats
METRO MANILA rose 16 spots last year to become the 59th most expensive city in the world for expatriates after an economic rebound and a stronger peso made leases more costly, consultancy firm ECA said in its annual Accommodation Report.
Rental costs here were also the 12th most expensive in Asia, ECA said, based on September 2010 data on two-bedroom properties "commonly inhabited by international assignees". The Philippine capital, which ranked 13th in Asia in the previous report, surpassed neighboring capitals like Taipei, Kuala Lumpur and Shenzen. Tokyo topped the global and Asian rankings due to the strengthening of the yen even as actual rental prices dropped by 7% last year. Expatriates there had to fork over an average $4,352 a month. The Japanese capital was followed by Moscow, Hong Kong, London, Singapore, Caracas, Abu Dhabi, Bogota, San Francisco and Geneva. In Asia, Tokyo was joined by Hong Kong, Singapore, Seoul, Shanghai, Hanoi, Bangkok, Mumbai, Jakarta and Beijing as the top ten cities. The region saw leases rise by an average of nearly 7% in 2010 after falling by more than a tenth in 2009. "The strong rebound in rental rates in many cities reflects both the rapid economic recovery and the continued expansion of companies into the region," Lee Quane, regional director of ECA Asia, said in a statement. Rent in Metro Manila rose by 14% "due to the strengthening of the peso against the greenback", ECA said in an e-mail to BusinessWorld. This was based on properties mostly in Makati. Hong Kong, meanwhile, saw rents increase by 22% to $2,830 a month for a two-bedroom unit after prices fell by roughly a quarter the previous year, ECA said. -- Jessica Anne D. Hermosa | 
