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PH economy hampered by monopolies, lack of competition: World Bank

MANILA – The Philippine economy is hampered by monopolies, duopolies, and oligopolies in key markets, the World Bank said in a study presented on Monday. The multilateral lender said the Philippine economy is “more concentrated” than other economies in the region and that fostering fair market competition in key sectors can boost economic growth. World…

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PH economy hampered by monopolies, lack of competition: World Bank

MANILA – The Philippine economy is hampered by monopolies, duopolies, and oligopolies in key markets, the World Bank said in a study presented on Monday.
The multilateral lender said the Philippine economy is “more concentrated” than other economies in the region and that fostering fair market competition in key sectors can boost economic growth.
World Bank and @CompetitionPH discuss how to foster competition in PH amid challenge of restrictive regulations pic.twitter.com/Xpaak28HuZ
— Jacque Manabat (@jacquemanabat) March 4, 2019
Among the sectors that need to see more competition are electricity, telecommunications, and transport.
Letting more players enter these industries can improve services and generate higher-paying jobs, and hasten poverty reduction, the World Bank said.

“The Philippines has adopted key reforms to foster competition but slow implementation continues to hinder the potential benefits of these reforms to consumers, keeping prices high and choices limited,” said World Bank senior economist Graciela Murciego.
Philippine electricity costs are high, and capacity is limited, said the multilateral lender.
“This is largely due to the slow implementation of reforms, such as the open access provisions and retail competition, under the Electric Power Industry Reform Act of 2001,” the World Bank said.
It also pointed out that limitations on foreign direct investments are preventing the development of electricity infrastructure.

The World Bank also said the cost of mobile phone services in the Philippines is the highest in East Asia, and four times higher than the average price in rich countries.
“Restrictions in transport sectors, particularly cabotage rules and limits to foreign participation, impairs logistics in the Philippines, creating bottlenecks,” the bank said.
Lack of competition, the bank said, is one of the main reasons why domestic shipping in the Philippines is more expensive than in Malaysia or Indonesia.
Philippine Competition Commission Chairman Arsenio Balisacan, meanwhile, said that policy reforms are underway.
The agency said it is finalizing the National Competition Policy (NCP), an executive order that lays out a comprehensive framework that steers regulations and administrative procedures to promote free and fair market competition.
“We just need to give the Cabinet more details.

Medyo nagkulang lang ng appreciation but we are optimistic this will be passed.”
The competition policy, Balisacan said, will lead to the effective enforcement of the Philippine Competition Act, pro-competitive government regulations, and the internalization of the principle of competitive neutrality.
Balisacan explained that if the NCP is executed, all government agencies will effectively be directed by President Rodrigo Duterte to assess and remedy competition-related issues.
“Ang habol din namin dito yung ma-continue yung policy kahit tapos na itong administration.”
(We want the policy to be continued beyond this administration.)
— With a report from Jacque Manabat, ABS-CBN News
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Lyft IPO — What to know in markets Friday

Lyft takes centerstage on Friday. The ride-sharing company is gearing up to have the biggest tech IPO in two years, at least until rival Uber hits the market. On Thursday evening, Lyft priced its stock at $72 per share , valuing the company at over $20 billion. The stock will debut Friday morning on the…

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Lyft IPO — What to know in markets Friday

Lyft takes centerstage on Friday.
The ride-sharing company is gearing up to have the biggest tech IPO in two years, at least until rival Uber hits the market. On Thursday evening, Lyft priced its stock at $72 per share , valuing the company at over $20 billion. The stock will debut Friday morning on the Nasdaq under the ticker LYFT.

And some Wall Street analysts have initiated coverage of the stock ahead of the highly-anticipated IPO.

DA Davidson was the first to get bulled up on Lyft. On March 19, the firm initiated Lyft as a Buy and slapped a $75 price target on the stock.

Analyst Tom White argued, “LYFT is the #2 player in U.

S. ridesharing, but has grown its market share from 22% to 39% in the past two years. LYFT has benefited from PR/management/operational stumbles at its largest competitor, but is deftly maximizing the benefits by aggressively differentiating its brand/mission around socially-conscious values and corporate responsibility. This is good PR, but also good for business.”
Then on Thursday, Wedbush initiated Lyft as Neutral with an $80 price target. “The brand loyalty of Lyft has been quite impressive as the company continues to attract drivers and riders with its brand associated with corporate responsibility and social values, an impressive formula to go after the $1.2 trillion market spent annually in the US,” analyst Dan Ives wrote in a note to clients.

Heidi Chung is a reporter at Yahoo Finance.

Follow her on Twitter: @heidi_chung .
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economy: El-Erian.

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Hong Kong has licensed its first three digital banks — and tech giants may lose out (TCEHY, HSBC, BACHY, BABA, ACN, GS)

Mekebeb Tesfaye 0m This is an excerpt from a story delivered exclusively to Business Insider Intelligence Fintech Briefing subscribers. To receive the full story plus other insights each morning, click here . The Hong Kong Monetary Authority (HKMA), the territory’s de facto central bank, has granted the first set of its long-awaited digital-only banking licenses,…

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Hong Kong has licensed its first three digital banks — and tech giants may lose out (TCEHY, HSBC, BACHY, BABA, ACN, GS)

Mekebeb Tesfaye 0m This is an excerpt from a story delivered exclusively to Business Insider Intelligence Fintech Briefing subscribers. To receive the full story plus other insights each morning, click here . The Hong Kong Monetary Authority (HKMA), the territory’s de facto central bank, has granted the first set of its long-awaited digital-only banking licenses, reports Bloomberg. Business Insider Intelligence The first batch of approvals has been given to firms that have partnered with Standard Chartered, Bank of China Hong Kong, and Chinese digital insurance firm ZhongAn, and the firms intend to begin operating within nine months. Although at least two of the joint ventures — with Standard Chartered and ZhongAn, respectively — had been expected to receive approval, the decision not to award licenses to Chinese tech giants Tencent and Alibaba affiliate Ant Financial has surprised many observers, per the Financial Times. Here’s what it means: The licenses should ignite competition by giving holders access to a hugely profitable banking market where consumers continue to be frustrated by their options.

Hong Kong’s banking sector is heavily dominated by a handful of incumbents.

The four largest lenders — HSBC, Bank of China, Hang Seng Bank, and Standard Chartered — account for 66% of retail banking loans and 77% of mortgages, per Bloomberg citing Goldman Sachs. And their share of the market is lucrative: For example, two-thirds of HSBC’s global profits last year came from its retail and wealth management operations in the territory, reports Reuters. However, the new licenses are anticipated to put up to 30% or $15 billion of Hong Kong’s total banking revenues up for grabs — threatening the big four’s entrenched position. Hong Kong registers among the lowest rates of customer satisfaction for a developed economy due to a lack of banking competition. Only 59% of consumers in Hong Kong say they like their bank, compared with 62% of global consumers and the 74% who say the same in the US. Further, less than half (43%) of bank customers in Hong Kong say they have a positive experience when visiting a bank branch, compared with the 57% of global consumers who say the same; and it’s significantly less than the 74% of US customers who report having a positive experience, per an Accenture survey seen by Business Insider Intelligence. Increased competition ushered in by the new license holders should force the old guard to up their game and ultimately improve these customer satisfaction numbers.

The bigger picture: Hong Kong’s efforts to remedy financial services competition and customer satisfaction may hurt established players, but it could also further entrench the position of some.

Although Hong Kong’s big four could be the biggest losers, the likes of Standard Chartered appear to be getting ahead of the curve. The chronic dissatisfaction of the territory’s digitally savvy consumers is a boon for the newly licensed firms, giving them an opportunity to scoop up customers at pace: 68% of customers use digital channels to check their bank accounts at least once a week, per Accenture. Moreover, while the likes of Ant Financial and Tencent haven’t yet received approval, their potential entry into the market could give the old guard a run for their money. However, the fact that Standard Chartered and Bank of China are among the players to be permitted first suggests established players are already in front of the trend. Given their vast resources and existing reach, the newly approved licensing could be an opportunity to maintain the status quo. So, while the licensing is generally good news for consumers, its business impacts for established and new entrants remain to be seen.

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Here comes Lyft… (LYFT)

John Sciulli/Getty Images for Lyft Lyft , the first ride-hailing company to hit the public market, began trading Friday on the Nasdaq stock exchange. Its shares opened at $87.24, jumping 21% from the $72 where they priced Thursday evening. That brought its valuation to just over $29 billion. Lyft shares gave back some gains in…

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Here comes Lyft… (LYFT)

John Sciulli/Getty Images for Lyft
Lyft , the first ride-hailing company to hit the public market, began trading Friday on the Nasdaq stock exchange. Its shares opened at $87.24, jumping 21% from the $72 where they priced Thursday evening. That brought its valuation to just over $29 billion.

Lyft shares gave back some gains in the afternoon, but the company still carries a market value of roughly $27 billion. Several Wall Street analysts are already bullish on the world’s second-largest ride-share company.

Watch Lyft trade live .
Lyft , the first ride-hailing company to launch on a US public market, began trading Friday morning under the ticker ” LYFT .” Shares jumped 21% to $87.24 apiece as they opened, bringing the valuation to just over $29 billion.
The company priced its initial public offering at $72 per share the evening prior, at the upper-end of its expected range.
But the newly minted stock’s rally was fading by midday, as shares had given up around half of their opening gains by 1 P.

M. ET.

Lyft was trading just above $81 a share, below where they’d opened earlier in the session.

Lyft’s offering raised about $2.69 billion, which it plans to spend on “working capital, operating expenses, and capital expenditures,” as well as acquiring or investing in businesses, according to its S-1 filing with the Securities and Exchange and Commission.
While potential investors will have a chance to buy into one of the largest US-listed technology IPOs in recent years, one thing they won’t have is equal say in how the company is run.
That’s because Lyft will have a dual-class structure consisting of Class A and Class B shares. That means outside investors of the former are entitled to one vote per share while shareholders in the latter are entitled to 20 votes per share.

Investor appetite for Lyft’s publicly traded shares was strong heading into Friday’s debut despite the company providing no clear timeline for reaching profitability .
Lyft earlier this week raised its expected IPO range from between $62 and $68 a share to $70 to $72 after its offering was oversubscribed . In other words, demand for its IPO exceeded the number of shares issued.
Read more: READY FOR LYFT OFF: Lyft to IPO today at whopping $21 billion valuation
In the race to go public during what’s expected to be a banner year for high-profile IPOs — with Airbnb, Slack, and Peloton all expected to debut — Lyft is set to beat out rival Uber to the public markets.

“In our opinion while Lyft has clearly benefited from some of the negative PR issues that Uber faced in 2017/early 2018, going forward the battle for market share will be a bit more balanced,” Wedbush analyst Dan Ives said in a note to clients earlier this week.
Ives initiated coverage with a “neutral” investment rating and a 12-month price target of $80.
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