The Philippines continued on its growth trajectory in 2012, improving on its performance the previous year. The economy grew by 6.6 percent compared to 3.9 percent the year before. Average inflation, or the rise in consumer price levels, was benign at 3.2 percent compared to 4.6 percent in 2011.
The buoyant stock market seems to be telling us that things are going to get even better. Investors expect that as our fellow countrymen reap the benefits of structural economic reforms, businesses will prosper and corporate earnings will grow.
Fitch Ratings gave the Philippines its first investment grade rating, BBB, in March 2013. This has placed the country in the line of sight of investors in the international financial community. Being investment grade boosts confidence and elevates expectations even further. And even recently, the Japan Credit Rating Agency gave the Philippines an investment grade rating as well.
In this environment, it is imperative that we continue investing in key initiatives that will allow us to provide better and more meaningful services to our customers.
ABS-CBN, mindful of the relentless onslaught of competition, has mapped out its strategy for superior content creation and unparalleled availability on multiple platforms. Programming innovations are based on thoughtful, two-way communication with its global audiences, made possible by internet and mobile technologies.
As announced early this year, our (Lopez Holdings) vice chairman, Mr. Eugenio Lopez III, retired as CEO of ABS-CBN, but continues to serve as its chairman. Under its first female and non-Lopez CEO, ABS-CBN intends to move quickly to respond to the changing needs and wants of its core audiences. ABS-CBN president and CEO Ms. Charo Santos-Concio is up to the task of deepening the company’s relationship with its various audiences, while enhancing shareholder value.
With new investments beginning this year through 2014, we expect ABS-CBN to execute a digital convergence strategy that will secure its berth in an increasingly competitive media landscape.
In the power and energy sector, First Philippine Holdings, is forging ahead to realize better value from the very valuable assets in its re-balanced portfolio. It is looking at new investments in renewable energy, indigenous energy, and infrastructure.
Much of the action will happen at the EDC (Energy Development Corporation) level, with renewable energy development particularly in wind, geothermal energy exploration overseas, and optimizing the operation of existing plants. EDC perseveres in the challenging work of rehabilitating geothermal units awarded from government auction.
In the property sector, Rockwell Land has launched the Proscenium, a luxurious development of the old Colgate-Palmolive property across the existing Rockwell Center in Makati. It continues to sell The Grove, Edades and 205 Santolan in Quezon City. It is also expanding into the middle market with a new brand called Primaries, and is preparing a project in Cebu City. The Bangko Sentral ng Pilipinas has committed to keep interest rates low this year all the way to the fourth quarter at least. So this is really a good time for property buyers to lock in at affordable rates.
First Philippine Industrial Park (FPIP), which admirably is coming off four consecutive years of record performance, now has more land to sell after purchasing 100 additional hectares in 2012. FPIP is now host to over 65 locators, employing more than 33,000 workers and exporting in excess of US billion annually.
Being stationed in Tokyo, I am witness to the heightened interest Japanese investors have in the Philippines. Murata Manufacturing, which makes capacitors for mobile phones and tablet computers, and computer printer giants Canon, Inc. and Brother Industries, Ltd., were among the locators that inaugurated newly built factories last year. The multimillion dollar manufacturing facilities of these companies began operations earlier this year employing thousands of our countrymen.
With the favorable investment climate and the good reviews on President Benigno Aquino’s leadership, we will need to look at more industrial properties to develop, if we want to continue helping our country sustain this growth trajectory.
Everywhere there is optimism and eager anticipation for what is yet to come. President Aquino’s commitment of a responsible and transparent government is finding mirror or counterpart commitments from business and industry. Better yet, our fellow citizens have grown vigilant and demand accountability from public and private institutions that serve them.
As we look to the future with hope, we renew our commitment to improve the lives of our fellow Filipinos, inspiring the best in our people and always presenting the best of our nation to the world.
We sincerely thank our shareholders, partners, fellow employees, associated companies and other stakeholders for joining us in the work of creating value for everyone.
In closing, I wish to take this opportunity to remember our friend, and late director, Mr. Felipe Alfonso, who passed away last month, on April 5. I worked for many years with Fil on the Meralco (Manila Electric Company) board, where he served as chairman from 1994 to 2001. He was a member of the Lopez Holdings board from 1996 until the day he passed away. He also served as executive vice president-Human Resource Development of Lopez Holdings from 2000 to 2011. His solid academic background and decades of management experience allowed him to contribute substantially to strategic and policy directions of many corporations and non-profits that invited him to sit on their boards. We are grateful for Fil’s many, many years of service and genuine malasakit for the Lopez Group and its various stakeholders. We will surely miss him.
Maraming salamat po sa inyong lahat.
Amb. Manuel M. Lopez
Chairman and CEO
Lopez Holdings Corporation