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Iraq not willing to cut 4.7-M barrel oil output irrespective of OPEC deal

MOSCOW -- Iraq is not going to reduce current oil production level, media reported Sunday. Iraq is not going to reduce the achieved oil production level of 4.7 million barrels per day, media reported Sunday, citing Falah Al-Amri, the head of the state-backed Iraqi company State Oil Marketing Organization (SOMO). "We have passed 4.7 million barrels a day … We are not going back. It’s a question of sovereignty," Al-Amri said at the press conference in Baghdad as quoted by Bloomberg. On September 28, member states of the Organization of the Petroleum Exporting Countries (OPEC) agreed on cutting its oil production for the first time in eight years. The output ceiling was set at 32.5-33 million barrels a day for the whole cartel, however, no exact limits for each country have been placed. The …

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Subsidies to GOCCs drop in August

Subsidies to state-owned companies declined in August this year after it surged in the previous month, data from the Bureau of the Treasury showed. Based on the Treasury report, the national government spent P7.4 billion in subsidies last August, down by 16 percent from R8.8 billion in the same month last year. Of that amount, about 45 percent of the total government subsidies went to the Power Sector Assets & Liabilities Management Corporation (PSALM). During the Duterte administration’s first month in office, the government spent P35.26 billion, and bulk of which, or P33.8 billion, was used to pay off the health insurance coverage of indigent families, through the Philippine Health Insurance Corp. (PhilHealth). The government needs to provide some financial support to PhilHealth to pay off the health insurance premiums of beneficiaries identified by …

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Hanjin Shipping in talks to sell Long Beach Terminal stake to MSC

Seoul – Hanjin Shipping Co. Ltd. is in talks to sell its stake in the Long Beach Terminal in California to Geneva-based Mediterranean Shipping Company S.A. (MSC), a spokesman for the Seoul court overseeing the shipper's receivership said on Friday. Hanjin Shipping owns a 54 percent stake in Total Terminals International LLC, which operates Long Beach Terminal in the US MSC owns the remaining 46 percent. It has appointed an advisor, an overseas firm specializing in shipping industry talks, to help with the negotiations, the court spokesman said. Hanjin, the first major shipping line to be dragged down by global industry overcapacity and low freight rates, put up other assets such as its US-Asia route manpower and logistics systems, five container ships and 10 overseas businesses, for sale earlier this month. Hyundai Merchant Marine …

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DOF sees PH becoming Asia’s economic powerhouse

The Duterte administration vowed to undertake “long-postponed” institutional reforms to transform the Philippines from being Asia’s laggard into an economic powerhouse, the Department of Finance (DOF) said. As President Rodrigo R. Duterte recalibrates the country’s foreign policy, Finance Secretary Carlos G. Dominguez III said the government’s focus is to undertake economic investments to finally lick poverty in the country. Under the government’s medium-term goal, the Philippines will become an upper middle-income nation and become an investment-driven economy in six years.  To achieve this goal, the finance chief wants to implement the tough reforms ranging from the upgrade of its law enforcement capabilities to the long-overdue overhaul of its tax system.  “We have the elbowroom to undertake the institutional reforms necessary to bring our country to the high-middle income level over the next six years,” …

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Aboitiz maintains P60-B capex in 2017

Aboitiz Equity Ventures, Inc. is investing almost P60 billion next year for the continued expansion of its subsidiaries engaged in the power, food, cement and property development businesses. In an interview during the weekend, AEV Senior Vice President and Chief Financial Officer Manuel Lozano said their capital expenditure (capex) budget is P58 billion this year and they will allot “probably next year also P50-plus billion again. Its about the same.” Lozano said their power business, through Aboitiz Power Corporation, will continue to get the lion’s share of the capex “because we still have a lot of projects that are onging.” “We have Therma Visayas and Cebu, Pagbilao, and Manolo Fortich in Mindanao. The biggest is power. Probably more than three-fourths of that (capex) will be power,” he said. Lozano also noted that Pilmico Foods …

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BPO seeks Malacañang clarification

The $22 billion IT-business process management (IT-BPM) industry is seeking clarification on President Duterte’s pronouncements for “separation” of economic relations with US, the Philippines’ long-time ally. In a speech during his four-day state visit to China, the President declared to break from the economic and military relations from the US. The IT-BPM industry, which is largely represented by the Business Process Association of the Philippines (IBPAP), generated $22 billion in  services exports last year. Of the $22 billion revenues, majority or 80 percent originate from US-based clients. The industry employs 1.1 million skilled Filipinos. “We continue to monitor the developments given President Rodrigo R. Duterte’s pronouncement Thursday regarding our military and economic ties with the US. IBPAP has formally reached out to the Office of the President to secure an audience with him …

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US readies 2nd MCC compact for PH agri

Despite unsavory rhetoric by President Duterte against the United States, the country’s long-time ally instead turned the other cheek as it readies a grant that will help develop the Philippine agriculture, a key component of the government’s 10-Point Economic Agenda. A statement to the media by the Philippine Embassy in Washington D.C. said that officials of the Millennium Challenge Corporation. (MCC) and Philippine government officials discussed the second compact program and its relevance to improving Philippine agriculture at a recent forum on World Food Prize in Iowa.  MCC is an independent U.S. Government foreign aid agency. Earlier this year, the Philippine government completed the first 5-year compact, a $433-million MCC program focused on road rehabilitation, community development, and revenue administration reform. The second compact, now under development, is proposed to focus on increasing …

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P80-B subsidy needed to lower PH power rates

The government will need to shell out at least P80 billion in annual subsidy for the power sector to gain that leverage of lowering rates to the level of the subsidized energy markets of Asian neighbors. This has been the assessment of Australian consulting firm International Energy Consultants (IEC) and its prescription on the never-ending debate if there are measures that can be done to bring down power rates similar to those enjoyed by other countries. Filipinos are incessantly complaining about perceived high electricity tariffs, despite recent result of the IEC survey indicating that power rates in the franchise area of Manila Electric Company (Meralco) had already been down 28 percent (excluding the value-added tax component) compared to 2012. IEC Managing Director John Morris said “government subsidies continued to play to make power …

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VLCC rates to stay firm on high cargo volumes

Singapore – Freight rates for very large crude carriers (VLCCs) could dip but are likely to remain firm next week on buoyant cargo volumes, ship brokers said on Friday. That came after VLCC rates from the Middle East to Japan hit a fresh four-month high on Wednesday, rising to almost 67.75 on the Worldscale measure, equivalent to $47,479 per day, the highest since June 8. “Rates will come off a bit, but it’s difficult to say how much. I don’t think we’ll see the market drop dramatically,” a European supertanker broker said on Friday. The broker estimated there were around 135 Middle East VLCC cargoes fixed for loading in October although other market watchers recorded around 140 fixtures. Supertanker rates were also buoyed by a 50 percent increase in the number of fixtures from …

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PNOC-RC could take over Agus-Pulangui operations

Instead of decommissioning the Philippine National Oil Company-Renewables Corporation (PNOC-RC), the Department of Energy (DOE) is proposing that it be positioned to takeover the operations of the 982-megawatt Agus-Pulangui hydropower complex in Mindanao in case the final decision is to retain these assets under government ownership. Energy Undersecretary Felix William Fuentebella said this is an option they are seriously considering at this point – and also a proposal that the department would lodge to Congress relative to the future of the Mindanao hydropower facilities. “Instead of creating a new company, our course of action is to align PNOC-RC for the operations of Agus-Pulangui assets, after all, it’s already an existing entity,” he said. It must be noted that stakeholders in Mindanao have been proposing the creation of a new entity to assume the …

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