Philippines’ Social Security System (SSS) fund invests energy stocks

Philippines pension fund Social Security System (SSS) could increase investments in local equities by up to₱ 20 billion pesos ($470 million) and is particularly interested in energy stocks, its president and CEO said on Thursday.

The state-run fund for private sector workers, which has stakes in leading telecom Philippine Long Distance Telephone Co and top gold and copper miner Philex Mining Corp , expects to beat its net revenue target of ₱16 billion pesos this year given the stock market's rise to a record high.

SSS net revenue last year was ₱ 22 billion pesos.

"We should be able to do better than that," president and CEO Emilio de Quiros told a media forum, referring to this year's net revenue target.

"(Energy) is a sector that we are looking at, the potential is there. It's a sector that could provide good returns for us," he said, adding the fund may buy shares in initial public offerings of energy firms.

Food-to-power conglomerate San Miguel Corp said (July 7) it plans to list its energy unit, San Miguel Energy Corporation, this year.

De Quiros said the fund did not anticipate the stock market to hit new highs this year.

The Philippines' main stock index has risen more than 4 percent this year, hitting a record high on Tuesday (July 5). The market rose 63 percent in 2009 and 38 percent in 2010.

De Quiros said the fund's investments in stocks and government securities made up 21 percent of its investment funds of ₱286 billion pesos, below the 30 percent limit.

"We're examining very carefully whether we need to reallocate (investments) or increase a little. Right now, our investments are still doing well -- whether in mining, financials or telecom," he said.

The Philippines Stock Exchange wants to ease its listing and disclosure rules for petroleum and renewable energy firms, a sector seen as a growth driver for the bourse, the smallest amongst major Southeast Asian nations, and the economy.

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World Bank hails steady Philippines' 2011 Economic growth

The World Bank on Wednesday praised the Philippines for its steady economic growth despite the global economic shocks and hailed reforms made by the government of President Benigno Aquino.

In its quarterly update, the bank said it expects Philippine economic growth to stabilize at 5.0 percent this year and rise to 5.4 percent next year. The economy grew 7.6 percent last year.

Manufacturing, construction, buoyant metals prices as well as a booming business process outsourcing industry are expected to be the main growth drivers, said World Bank senior economist Eric Le Borgne.

The body also cited potential gains from reforms put in place by Aquino who was elected in May, 2010.

"Prospects on the supply side remain favorable with manufacturing and construction projected to benefit from the end of the trade disruption linked to Japan’s post-disaster reconstruction," Le Borgne said in a statement.

The update also praised Aquino for his efforts to fight corruption, upgrade the country's infrastructure, and open up aviation to foreign competition to boost tourism.

World Bank country director Bert Hofman said the Philippines' recent performance, which saw 4.9 percent growth in the three months to March, suggests growth had become more robust and steady since the global crisis.

He cited a series of credit rating upgrades that put the Philippines' sovereign debt to within two rungs of investment-grade last month.

Aquino's office said in a statement that the World Bank report showed that the Philippines' economic fundamentals had "significantly improved" and that the government's programs were sound.

Manila has an "aspirational target" of 7-8 percent GDP growth for 2011 but projects more modest growth of 5-6 percent.

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