BusinessMirror May 19, 2016

VP HOPEFULS SQUARE OFF IN DEBATE

“FLYING blind is nuts.”—Jeremy Bird, who worked for President Barack Obama’s data-rich campaign, after Donald Trump told The Associated Press in a recent interview that he plans to win the White House largely on the strength of his personality, not by leaning heavily on complex voter data operations. AP

MEDIA PARTNER OF THE YEAR

“TODAY I begin a new chapter filled with personal hope and hope for others who have suffered genital injuries. In sharing this success with all of you, it is my hope we can usher in a bright future for this type of transplantation.”—Thomas Manning, a 64-year-old cancer patient from Massachusetts, who received the nation’s first penis transplant. AP

BusinessMirror

UNITED NATIONS

2015 ENVIRONMENTAL MEDIA AWARD LEADERSHIP AWARD 2008

A broader look at today’s business

www.businessmirror.com.ph

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Thursday, May 19, 2016 Vol. 11 No. 222

LAWMAKERS RELIEVED 8PT. AGENDA TO CONTINUE AQUINO’S ECONOMIC POLICIES

Solons got Duterte’s back on policy-continuity tack B J M N.  C  B C

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@joveemarie

@BcuaresmaBM

RESIDENTELECT Rodrigo R. Duterte appears to have earned the support of President Aquino’s allies in the House of Representatives this early, mainly because of his policycontinuity program on the economy.

The direction chosen

by Duterte…should bring confidence to our business sector.”—Q Lawmakers on Wednesday said Duterte’s eightpoint economic agenda, which is a continuation of the policies of the outgoing Aquino administration, could further strengthen the macroeconomic fundamentals of the country.

C  A

INSIDE

BIKING IN THE CANARY ISLANDS, OUT OF MY COMFORT ZONE The good news from God

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EAR Lord, we rejoice that God our Father wants people to enjoy life on Earth. He created the Earth and everything on it because He loves mankind. Soon He will act to provide a better future for people in every land—He will relieve mankind of the causes of suffering. (Jeremiah 29:11) No government has ever succeeded in eliminating violence, disease, or death. But there is the good news from God. Shortly, He will replace all human governments with His own government. Its subjects will enjoy peace and good health. (Isaiah 25:8, 33:24.

Daniel 2:44) We must be grateful to God at all times. Amen.

GOOD NEWS FROM GOD, PAMPHLET SHARED BY LOUIE M. LACSON, HFL Word&Life Publications • teacherlouie1965@yahoo.com

Editor: Gerard S. Ramos • lifestylebusinessmirror@gmail.com

Life

Thursday, May 19, 2016

BY LORI RACKL Chicago Tribune

GUESS you could call it a midlife crisis.

I’d flown across the Atlantic Ocean for a weeklong cycling trip on this Spanish archipelago off the coast of Morocco. The crisis part came as I watched a Trek Travel guide hoist my Domane road bike onto the roof rack of the support van, and I sheepishly crawled into the passenger seat, while the other cyclists on the trip pedaled up the hill and out of sight.

“We’ll just give you a bump to the next rest stop,” the guide said with an extra dose of enthusiasm to offset my palpable disappointment.

Let me back up: I love to bike. I also love to travel.

My favorite kind of vacation is...drumroll...a cycling trip. Over the years, I’ve biked in a lot of different places, including France, where I’ve summited the likes of Mont Ventoux and suffered through the quadbusting switchbacks of Alpe d’Huez. I may not be fast, but I’ve rarely met a climb I couldn’t conquer. Until I landed on Gran Canaria. Which is full of them.

The second-most populous of Spain’s Canary Islands after Tenerife, the volcanic dollop of Gran Canaria has become a magnet for pro cyclists trying to keep their legs fresh in the off-season. Former Tour de France winner Alberto Contador and his Tinkoff teammate Peter Sagan were just a few of the notables who happened to be sharing these steep roads with us mere mortals last December.

“The pros have already crushed Majorca, so they’re looking for somewhere new,” explained Sam Clark,

It was a humbling day when a particularly brutal gantlet of hills had me ditching my bike for a ride in the van. A few years ago, I probably would have had enough gas in the tank to haul myself up that 20-percent grade. Now, my 46-year-old legs were having none of it.

At least my 46-year-old brain was smart enough to realize that I should save my energy for later in the day, when the plan called for biking to Gran Canaria’s highest point: Pico de las Nieves. Perched at 6,394 feet, “peak of the snows” sits atop a pine forest on an isle more associated with palm trees.

The temperature slowly dropped, as my husband and I threw our bikes into granny gear and inched our way up the volcano to the summit, where our group celebrated a hard day’s work with high-fives and hot chocolate. What goes up, of course, must come down, and these precipitous descents were where I struggled most. I routinely kept a chokehold on the brakes, nervously eyeing the blind corners and guardrails that seemed just high enough to stub your toe as you plummeted off the mountain.

The guides could tell the descents made me nervous. It might have had something to do with my repeatedly saying, “The descents make me nervous.”

They suggested sections of the route I’d be better off traversing on four wheels instead of two.

They also let me know when I was selling myself short—something I started to do with surprising ease once the seal was broken on my pride.

“You handle the bike better than you think you do,” guide Ilona Kohlerova responded when I told her I’d rather take the shuttle down a particularly scenic

descent. “I’ll ride with you,” she said, urging me to give it a shot. “Just follow my line.”

Contemplating her offer, I looked around and saw spandex-clad cyclists from Scandinavia and beyond— many of them much older than my 46 years. Like me, they came here to bike. It’s a big world, and I didn’t know if I’d ever make it back to this corner of it. One thing I did know: If I didn’t at least try to trail Ilona down the mountain, I’d always regret it.

With white knuckles protruding from my bike gloves, I gingerly followed Ilona’s line, eventually relaxing enough to cruise along the undulating road that looked like a typewriter ribbon strewn across a green valley. There were a few harried moments, the scariest of which involved a game of chicken with a big blue bus. But Ilona and I made it back down to sea level, safe and sound.

Crisis averted, on all counts.

LIFE

IF YOU GO ■ Trek Travel: Six-day cycling trips in the Canary Islands are scheduled December through February and priced at $3,299 a person, double occupancy. 866-464-8735, www.trektravel.com.

■ Getting there: There are no nonstop flights between the United States and Gran Canaria, but multiple European gateways connect to the island’s international airport in the capital of Las Palmas—a three-hour flight from Madrid.

The sand dunes at Maspalomas are spectacular. So are the area’s beaches. If you forget to pack a bathing suit, don’t fret. Clothing is extremely optional. ■

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WWW.HELLOCANARYISLANDS.COM

D.O.T. pushes campaign for tourism revival in Baguio City, Cordilleras THE Department of Tourism (DOT) is aggressively campaigning to bring Baguio City and the rest of the Cordilleras back to what they once were—a natural wonder and an ecological marvel. The DOT-Cordillera Administrative Region (CAR) has been partnering with local government units, business entities and every conceivable sector who can help “revisit, revitalize, revive and rev up the bloom” in this northern paradise. Finding its own “RevBloom” campaign imperative regionwide, the DOT-CAR has entered into a number of partnerships to improve the city’s tourism competitiveness, which observers said has continued to slip in the past years.

The city has become so highly urbanized that the rows of fresh-smelling pine trees that used to line its hills have been replaced with houses. But unlike the favelas in Brazil, most of the houses are made of concrete and obviously built purposely for the thriving dormitory business in the city, which hosts many of the popular universities and business-process outsourcing firms in the North.

Likewise, the sweet scent of pine that used to pervade the city has been replaced by the smell of fumes from vehicles that now congest the streets, especially Session Road.

The city’s population also grew from 298,527 in 2007 to 318,676 in 2010, at a growth

HILLSIDE before RevBloom

rate of 2.81 percent, nearly double the national average during that period.

The urban problems besetting Baguio had worried even Malacañang, such that in 2012, President Aquino directed the creation of a national Technical Working Group, headed by the DOT, to formulate a comprehensive plan for the redevelopment of city.

The ecological problems are overwhelming, but DOT-CAR Director Marie Venus Tan pins hope on her RevBloom campaign as the solution. An urban redevelopment tourism drive, RevBloom

an urban centerpiece while helping green up the rest of the city with plants in traffic circles and along the elevated walkways and arches.

Other ecological improvements are also being implemented at Burnham Park, which the DOT owns. The park is being beefed up by the DOT-CAR with flowering plants and ramps for persons with disabilities (PWDs).

Similar PWD ramps are envisioned for the entire city road network as schools and the communities are beautifying their respective barangays, including those on the sides of the hills whose facades are being painted with gigantic sunflower murals from paints donated

by Davies and art concepts from Baguio’s noted artists. When done, the murals will appear like mountain-size video walls, featuring the floral blooms that Baguio is known for.

Another agreement with Boysen covers the city center, specifically the repainting of its arches and walkways to revive the iconic green and white colors of Baguio.

The only city in the Philippines founded by the Americans for rest, recreation and wellness, Baguio also has hot springs, another tourism attraction. The campaign, now going regionwide, hit the ground running upon Tan’s return to her home city of Baguio from her stint in Europe as Philippine tourism attaché in Germany for 15 years.

HILLSIDE as envisioned under RevBloom

encompasses immediate, practical and longterm responses to the problems and is geared at instigating the reblooming of Baguio into a sustainable mountain resort city.

One of the RevBloom campaign’s strategies is to decongest Baguio City through the development of its surrounding municipalities, called BLISTT (Baguio, plus La Trinidad, Itogon, Sablan, Tuba and Tublay in the province of Benguet), as a metropolitan area.

“RevBloom has earned the support of the community, the local government and the private sector,” Tan revealed, citing the

DOT-CAR’s ongoing partnerships with the barangays, the University of the Cordillera, SM City, SMC-TPLEx, Davies and Boysen paints, the artists of Baguio, Max’s Group Inc., along with the top hotels and tourism establishments in the city. “We have also sought the support of the city government to free the Session Road of vehicular traffic as it used to be, and create a central parking area with electric cars and bambikes as alternative public conveyances for motorists so as to reduce air pollution,” Tan pointed out. She said SM Mall had agreed to put up a vertical garden all over its building as

DWIZ FRANCHISE EXTENDED

Communications Secretary Herminio Coloma Jr. (second from right) presents to DWIZ officials (from left) Alex Santos, News director; Rey Langit, Station manager; D. Adrian Cabangon, president and general manager; and Josephine Reyes, Aliw Broadcasting Corp. president, the new franchise of Aliw Broadcasting Corp. NONOY LACZA

HEALTH&FITNESS PREPARING FOR RIO

LIKE COMING INTO A FIGHT WITH A KNIFE

people to go abroad and take their customers to locations where clients want to go to and junkets can make money.”

Gaming promoters, also known as junkets, were dealt another blow this month when the Macau government banned phone betting, as tightened regulations called for stricter accounting transparency. Macau’s $30-billion gaming industry has seen revenue declines for nearly two years, amid China’s slowing economy and anticorruption campaign.

Junket law

IMPER I A L Pac if ic sha res dropped 2 percent at 11:26 a.m. in Hong Kong trading on Wednesday, while Melco International fell 1.7 percent.

Macau plans to raise capital requirements for junkets and is preparing to set up a credit database to help weed out risky gamblers, the government said this month as part of an interim review of the gaming industry.

S “M,” A

ALEXANDER POVETKIN tests positive to meldonium, the seeming drug du jour of Russian athletes. AP

T

positive for since it was banned on January 1.

“To see I was right all along is sad, man,” Wilder said. “I wanted to be wrong. Sometimes you can judge a person wrong.”

Povetkin’s promoter has demanded the fight be rescheduled, and contended the concentration of meldonium in the sample was extremely low.

The fighter himself said he did nothing wrong and expects to fight Wilder.

“I’m clean. I haven’t taken anything or consumed anything, so I’ve got nothing to fear,” Povetkin said, adding he took meldonium only before it was banned at the start of the year.

Wilder, though, isn’t so sure the fight will ever happen. He wants his money and some time to think about what to do next.

“I would respect them more if they just manned up and admitted it,” he said. “It’s downright sad and they should be locked up.”

after landing in Birmingham. “It hurts to put so much work into this, hours upon hours of training and sparring and then the traveling. To come up empty-handed is sad and sad for the sport. A lot of people missed out on a great fight.”

It wasn’t as if Wilder didn’t see something like this happening. A year ago, when the fight was being discussed, he questioned whether the 36-year-old Povetkin was on something because he had won all his fights by knockout and looked trimmer since losing a title fight to Wladimir Klitschko in 2013.

But the unbeaten Wilder, a bronze medalist in the 2008 Olympics, would be getting the biggest purse of his life by going to Moscow to face the No. 1 challenger for his piece of the title. He was eager to make a statement, and confident that Povetkin would be tested rigorously by the Las Vegas-based Voluntary Anti-Doping Association (VADA).

Povetkin passed at least two VADA tests, before failing one in April. The substance found in the test was meldonium, the stamina booster that tennis star Maria Sharapova and dozens of other athletes in ex-Soviet republics have tested

would be sending out a message that says it’s OK to do this.”

If there’s one sport where almost everyone would agree doping is not OK, it’s boxing. Unlike other sports, you don’t play at boxing.

And getting hit in the face by a 200-plus pound fighter is risky enough even if he hasn’t been taking performanceenhancing drugs.

“The head is not meant to be hit in the first place but we’re willing to do it to make money and provide for our family,” Wilder said. “But we never know if we’re going to come out of the ring like we came into it.”

The World Boxing Council ended up pulling the plug on Saturday’s fight, sending Wilder and his team scrambling to book flights back home to Alabama. His $4.5-million purse is in escrow and likely the subject of a court fight, and he’s out tens of thousands of dollars for training expenses in England.

One minute he was gearing up for the fight of his life.

The next he was on an airplane, feeling depressed about what happened.

“I’m just devastated,”Wilder told The Associated Press

The Associated Press

B T D

D

EONTAY WILDER was willing to risk his heavyweight title and unbeaten mark against a hometown hero in Moscow.

What he wasn’t as willing to risk was having his brains scrambled by the fists of a doped-up Russian fighter.

“This is already a put your life on the line type of sport,” Wilder said. “This was like someone coming to a fight with a knife in their hands.”

Wilder was training in England and about to take a plane to Moscow when his camp got word on Sunday that Alexander Povetkin had tested positive to meldonium, the seeming drug du jour of Russian athletes.

One of the better heavyweight matchups of the year was in limbo as Wilder’s camp and the World Boxing Council tried to decide what to do.

“I still wanted to fight,”Wilder said. “But at the end of the day I had to think about the repercussions behind it. We

LIKE COMING INTO

A FIGHT WITH A KNIFE

C1

If there’s one sport where almost everyone would agree doping is not OK, it’s boxing. Unlike other sports, you don’t play at boxing.

SPORTS

C1

R E SI DEN T A qu i no h a s signed the renewal of the legislative franchise of Aliw Broadcasting Corp., the broadcasting arm of the ALC Group of Companies with flagship radio stations DWIZ 882 and 97.9 Home Radio in Metro Manila.

In a simple turnover ceremony on Wednesday in Malacañang, Communications Secretary Herminio B. Coloma Jr. handed over to the officials of Aliw Broadcast-

ing the signed copy of Republic Act 10790, or “The Act Extending the Legislative Franchise of Aliw Broadcasting for Another 25 Years.”

Coloma said the organization of Aliw Broadcasting is in a class by itself, reflecting the persona of its founder, the late Ambassador Antonio L. Cabangon Chua, particularly his dedication to public service and perseverance for excellence.

“I would say the organization S “A,” A

Competition Act IRR to see regular updates–Balisacan B C N. P

| THURSDAY, MAY 19, 2016 mirror_sports@yahoo.com.ph sports@businessmirror.com.ph Editor: Jun Lomibao Asst. Editor: Joel Orellana

BusinessMirror

Sports LIFTERS BANNED M

OSCOW—Four Russian weightlifters, including a worldrecord holder, have been banned for doping.

Alexei Lovchev, who won a world title in Houston last November with a world-record total over two lifts, has been banned for four years after a positive test for the banned substance ipamorelin, the Russian Weightlifting Federation said on Tuesday.

His gold medal from the worlds is set to go to Lasha Talakhadze of Georgia, while his world record will be nullified, restoring a 16-year-old mark set by Iranian lifter Hossein Rezazadeh.

Russian weightlifters Alexei Kosov and Olga Afanasyeva were also banned for four years, while former European champion Olga Zubova was given an eight-year ban for a second offense. All three tested positive for steroids.

Zubova, who failed a test at the 2013 world championships, competed at the worlds only one month after her last doping ban expired.

The federation said in a statement that it planned to appeal Lovchev’s ban ahead of the Rio de Janeiro Olympics, claiming a mistake in the laboratory analysis, but did not dispute the other sanctions.

“The Canadian laboratory produced a mistaken result,” Russian Federation President Sergei Syrtsov told state TV. “There is a chance, a good chance, that Alexei will still be able to go to Rio. Specialists are working on this.”

International Weightlifting Federation lawyer Magdolna Trombitas told The Associated Press that the hearings for the four Russian lifters concluded, but said the federation could not comment publicly on the verdicts until the window for appeals expired.

Weightlifting has been dogged by persistent doping for years.

The entire Bulgarian team was barred from the Olympics after 11 of its lifters received doping bans last year, while recent years have also seen doping cases in leading countries, such as Kazakhstan, Azerbaijan and North Korea. AP Golf Channel will have its studio live from Royal Troon, which will include David Duval when he gets done playing. Duval won the Open at Royal Lytham & St. Annes in 2001; Faldo is a three-time champion; and Miller won in 1976 at Royal Birkdale.

“We have a deep bench,” McCarley said. “It’s one of the benefits of having a 24-hour golf network, and we’re also fortunate enough to have three people who have an Open Championship working for us.”

The times on the East Coast will be 1:30 a.m. to 4 p.m. on the weekdays, and 4 a.m. to 2 p.m. on the weekend (2:30 p.m. on Saturday).

Still to be determined is what it will do with its “Morning Drive” show. McCarley said Golf Channel was working on something “creative” to do with it. AP

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ONTE VEDRA BEACH, Florida—Take the longest day in major championship golf and a network devoted exclusively to golf and the result is unprecedented coverage. NBC Sports and Golf Channel will combine to provide a record 49.5 hours of live coverage over four days from the British Open at Royal Troon.

“You go first tee shot all the way through to the raising of the claret jug,” said Mike McCarley, president of Golf for NBC Sports Group. “It will be either on Golf Channel or NBC the whole way through.”

NBC and Golf Channel picked up the British Open a year early from ESPN, and it gives the network a major after the United States Golf Association (USGA) signed on with Fox. The Open will have 12 hours more than ESPN scheduled for last year.

The Masters prefers limited live television and provided 18.5 hours this year on ESPN and CBS. Fox said it will have 36.5 hours on FS1 and Fox. The Professional Golfers’ Association (PGA) Championship is shown on TNT and CBS with 28 hours from Baltusrol the last week in July.

The Open Championship, with the advantage of extended summer daylight in Britain, typically starts about 6:30 a.m. and the last group went off at 4:13 p.m. at Saint Andrews last year. Golf Channel and NBC, both owned

by Comcast, provide a seamless transition in its weekend coverage of the PGA Tour, and this will be no different.

“We looked at a lot of different schedules and measurements. We get very scientific with how ratings work,” McCarley said.

“But ultimately, we came back to the fact this is a major championship, everyone qualified to be there and they all deserve to be on the air. That’s been a philosophy of [NBC golf producer] Tommy Roy for a long time. We have the resources. We have the personnel. And we think it’s the right thing to do for the fans.”

McCarley said Johnny Miller, Nick Faldo and Frank Nobilo will rotate as the lead analyst in the 18th tower. Dan Hicks and Terry Gannon will handle the lead announcing role. The 10 analysts on the ground and other towers include the usual NBC crew (Roger Maltbie, David Feherty, Gary Koch, Peter Jacobsen, Notah Begay, Mark Rolfing) and some who mostly do Golf Channel telecasts (such as Curt Byrum and Jerry Foltz).

Golf, and more golf

M

ACAU’S gaming promoters are betting they can make money bringing high rollers to casinos in Southeast Asia and other tropical destinations, as increased government control crimps casino revenue in the world’s biggest gambling center.

Imperial Pacific International Holdings Ltd.’s said it will invest $7.1 billion through 2020 to expand its casino presence on the island of Saipan in the western Pacific Ocean and will debut a permanent casino there early next year. Melco International Development Ltd. is exploring a casino business in Vietnam, said Andy Choy, the company’s chief gaming officer, on the sidelines of a casino conference in Macau.

“Junkets are diversifying from Macau,” said Shen Yan, Hong Kong-based Imperial’s president of global capital markets. “The junket business in Macau has been really difficult because of the shrinking margin. It’s natural for these

ALIW BROADCASTING FRANCHISE EXTENDED FOR ANOTHER 25 YRS

PACKED with steep hills, a cycling trip through Canary Islands can be most challenging—but also very rewarding.

one of the two guides on Trek Travel’s debut Canary Islands bike trip.

A half dozen of us—ranging in age from a 37-yearold eight-time Ironman to a 65-year-old grandfather— had signed up for six days of serious cycling on the southern end of the island, best known for its long stretches of sand and resorts full of sun-starved Brits and Germans.

A three-hour flight from Madrid, Gran Canaria—a pit stop for Christopher Columbus on his journey to the New World—isn’t on the radar of most US travelers. Outside of our small group, I didn’t hear a single American accent all week. With its comfortable year-round climate and fun-in-the-sun vibe, the Canaries are like the Florida of Europe. But with hills.

Lots of steep hills.

“Ninety-five percent of the people who come here stay at the beach; they never make it to the mountains,” said Harold Mulherin, a University of Georgia finance professor. This marked his third cycling vacation on the island, whose rugged interior can trick you into thinking you’re in the Grand Canyon, not 130 miles off the coast of Africa.

The Canary Islands trip ranks as one of the most challenging offered by Trek Travel, a Madison, Wisconsin-based outfitter that runs guided bike trips for cyclists of all levels. The trips include lodging, most meals and the use of high-end Trek bikes. Guides take turns cycling with the group, which can get quite spread out over 60-mile days. They also drive the support van, providing snacks, water-bottle refills and flat-tire fixes, not to mention the occasional “bump” for weary riders.

Chinese VIPs wooed to tropical islands as Macau tightens rules

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Biking in the Canary Islands, out of my comfort zone

I

P.  |     | 7 DAYS A WEEK

REELING: THE CRITICS’ WAY D3

BusinessMirror

THE sand dunes at Maspalomas, on the south end of Gran Canaria. PHOTOS: LORI RACKL/CHICAGO TRIBUNE/TNS

“MY critics are at liberty to claim that I am trying to convert children to Satanism. And I’m free to explain I’m exploring human nature and morality—or to say ‘You’re an idiot.’”—Harry Potter creator J.K. Rowling, on her clashes with censors over her Potter books, which religious groups have accused of inspiring Satanism. AP

@c_pillas29

HE Philippine Competition Commission (PCC) on Tuesday said it will include government practices in its scoping study on industries and areas that could engender anticompetitive behavior.

The study will be a vital input in the crafting of the implementing rules and regulations (IRR) of the Philippine Competition Act (PCA).

Arsenio M. Balisacan, PCC

PESO EXCHANGE RATES n US 46.3850

We want to cover practices not just in the private sector but also government practices that might be causing some problems in competition.”—B chairman and former director general of the National Economic and Development Authority, said government rules will be scrutinized in a study the PCC is

working on, which is essentially a report on the Philippines’s competition landscape.

“What we really want to have is a report on the state of na-

tional competition in the Philippines, and we want to cover practices not just in the private sector but also government practices that might be causing some problems in competition. We’re looking at those,” Balisacan told the BusinessMirror in an interview on the sidelines of the first public consultations on the PCA’s draft IRR. He stressed that the IRR of the PCA will be a “living document.”

This means the commission will adopt clarificatory notes and additional guidelines even after the

final IRR is released to address issues raised by the private sector.

Without citing any government practice in particular, Balisacan conceded there are regulatory policies that inadvertently impinge on the country’s competitive environment.

The scoping study, he added, was temporarily stalled due to the ban on hiring new government employees during the election period. The new hires are needed to strengthen the PCC’s research team.

S “C,” A

n JAPAN 0.4251 n UK 67.0959 n HK 5.9760 n CHINA 7.1077 n SINGAPORE 33.8849 n AUSTRALIA 33.9631 n EU 52.4939 n SAUDI ARABIA 12.3690

Source: BSP (18 May 2016 )

A2 Thursday, May 19, 2016

BMReports BusinessMirror

news@businessmirror.com.ph

Communist rebels welcome Cabinet-post offer

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OMMUNIST rebel leaders welcomed on Wednesday a possible offer from the Philippines’s presumptive presidentelect of four Cabinet posts, raising the prospect of a government that includes Marxist guerrillas who have long demanded an end to the US military presence and the redistribution of land.

Rodrigo R. Duterte, who won the May 9 presidential election by a landslide, according to an unofficial count, has said he will likely offer the Communist Party of the Philippines (CCabinet positions in agrarian reform, environment, social welfare and labor.

“The CPP and the revolutionary forces welcome the possibility of joining presumptive President Duterte in an alliance government, whether in the form of assigning Cabinet positions to the CPP or its endorsees or some other more radical form of unity government which the maverick new president might be open to consider,” the party said in a statement.

It said an alliance would depend on principles, such as national sovereignty and social justice, including an end to the presence of US troops.

American troops have no permanent bases in the country, but hold regular joint exercises and have backed Philippine troops fighting Abu Sayyaf militants in the south.

It remains to be seen what common ground could be forged, given the wide gap between the longstanding demands of the rebels and past governments. On-and-off peace talks between the two sides have not led to a peace agreement or a long-term ceasefire as in the case of Muslim rebels, who have signed two separate autonomy deals with Manila.

While Duterte’s proposed offer of Cabinet posts could foster peace talks, any major political concessions are likely to be complicated, given the many years of fighting and enmity between the rebels and government forces.

Business and industry leaders would also likely oppose demands, such as an end to contractualization, the widespread practice of short-term employment, and higher wages. The government has also relied on closer military ties with the United States amid an increasingly tense territorial dispute with China over areas of the South China Sea. The party said in its statement

that it anticipates Duterte’s offer would be followed by peace negotiations in which key policy changes could be discussed thoroughly, because he knows “that what is more important to the revolutionary forces are the necessary changes in the policies and programs that govern these departments and the entire government.”

It said a labor secretary could only effectively serve the interests of workers if there are laws promoting unions, establishing a national wage system, and prohibiting contractualization. Similarly, an agrarian reform secretary could only serve the interests of farmers if there is genuine land reform, it said. AP

Solons got Duterte’s back on policy-continuity tack C  A

House Committee on Ways and Means Chairman and Liberal Party Rep. Romero Quimbo of Marikina said this will send a good signal to the international investment community since the Philippines achieved its fastest economic growth during Aquino’s six-year administration.

“The 8-point agenda is quite welcome considering that it seeks to continue the direction of the economy to make our macro economic fundamentals stronger to allow it to withstand external and local financial shocks,” he told the BusinessMirror.

On the right track

“THE direction chosen by President Duterte as far as the economy is concerned should likewise bring confidence to our business sector, many of whom were previously worried,” Quimbo added.

In a CNN Philippines report, Carlos Dominguez, who is report-

edly being eyed as Finance secretary of incoming administration, said the “economic agenda is wideranging from tax reforms to accelerating infrastructure building to support services for farmers and attracting foreign investments by reducing crime.”

Earlier, the Bangko Sental ng Pilipinas (BSP) also expressed confidence that the economic agenda of Duterte will improve the economy.

Partylist Rep. Sherwin Tugna of Cibac Party-list said the next administration’s plan of continuing the policies of the Aquino administration “is a good start because there will be continuity of programs.”

However, Tug na sa id Duterte should introduce “modifications and adjust accordingly so that there will be faster progress and development to our country.”

Party-list Rep. Rodel Batocabe of Ako Bicol said the continuation of economic policies of the Aquino administration will further stabilize the country’s economy.

“It is gratifying that the Duterte administration will be continuing with the policies of the Aquino administration. At least, it will assure the business community and investors that there will be no drastic and fundamental change in economic policies,” Batocabe said.

No deviation

THE underlying trends of the economy will still continue to be at play, as the incoming Duterte administration is not likely to deviate much from the economic platform of the Aquino administration, an international ratings agency said.

“Unofficial counts indicate that controversial Davao City Mayor Rodrigo Duterte convincingly won the presidency in the May 9 election[s]. From an economic policy standpoint, his statements since the election have so far focused on maintaining the previous administration’s infrastructure program via PPP (public private partnership), as well as endeavoring to revise constitutional restrictions

on foreign investment,” international ratings agency Standard and Poor’s Ratings Services (S&P) said in one of its research notes on the Asia Pacific.

“With economic policy unlikely to change significantly with the incoming president, underlying demographic trends will continue to drive growth. A growing and educated middle class will continue to be absorbed by a combination of overseas employment and a booming outsourcing industry, driving consumption and investment even as external demand remains weak,” it added.

As such, risk factors on the local economy will likely be coming from external factors such as persistently low oil prices. This, despite helping the goods trade balance, post a risk of sharply reducing the demand for overseas Filipino construction workers in the Middle East – a major source of remittances, according to S&P. ING Bank Manila economist Joey Cuyegkeng is also of the view

that growth continued its momentum and will be seen in the first quarter print to be announced today, Thursday.

Cuyegkeng said the local economy may have grown by about 6.6 percent in the first quarter of the year due to strong domestic demand supported by steady overseas workers’ remittances, government and election spending and favorable investment environment.

The eight-point agenda targets to: ■ Continue and maintain the current government’s macroeconomic policies; ■ Accelerate spending on infrastructure by addressing major bottlenecks on the public-private partnership program and keep the 5-percent infrastructure spending to GDP ratio; ■ Ensure the country’s attractiveness to foreign investors by addressing restrictive economic provisions of the Constitution; ■ Put up support services to small farmers to increase their

productivity and improve market access and develop agricultural value chain; ■ Address bottlenecks in land administration and management system; ■ Strengthen basic education system and provide tertiary education scholarships that address private sector requirements; ■ Improve tax system by indexing taxes to inflation rate; and Expand and improve implementation of the Conditional Cash Transfer program.

Aliw. . .

C  A

of Aliw Broadcasting is sui generis, the persona of its founder being reflected in the organization which he established,” Coloma said.

RA 10790 was signed by Mr. Aquino on May 3 to extend for another 25 years the legislative franchise of Aliw Broadcasting, which was signed 25 years ago in 1991 by his mother, former President Corazon C. Aquino.

Aliw Broadcasting officials, led by President and CEO Josephine Reyes and Vice President and General Manager D. Adrian Cabangon, received the signed copy of the law from Coloma, and welcomed Mr. Aquino’s approval of the extension of Aliw Broadcasting’s legislative franchise.

Other officials who received the legislative franchise were DW IZ Station Manager Rey Langit and DWIZ News Director Alex Santos. David Cagahastian

Competition. . .

C  A

The PCC intends to move forward with the scoping study after the release of the IRR, which is expected in June.

This scoping study will also thresh out the industries hampered by anticompetitive behavior in the market and will serve as guidance for firms in adjusting current practices to comply with the law.

As the law provides for a transition period for companies to adjust to the PCA, the commission will not yet impose sanctions, criminal or otherwise, against erring firms.

While the transition period is running, the commission can initiate investigations either on its own initiative or through a verified claim by a third party, PCC Commissioner Johannes Bernabe said.

Balisacan, however, said no investigation can proceed until the release of the IRR, where the ground rules are finalized.

BMReports BusinessMirror

news@businessmirror.com.ph

Thursday, May 19, 2016 A3

Chinese market boosted visitor arrivals in Q1 B M. S F. A

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Special to the BM

OREIGN tourists in the Philippines grew by 14.3 percent to 1.6 million in the first quarter of 2016, mainly boosted by the Chinese market, whose arrivals leapt close to 100 percent during the period. Total arrivals was a tad slower, though, than the 16.7-percent hike in visitors in the period JanuaryFebruary 2016.

Data from the Department of Tour ism (DOT) a lso show that tourism receipts in the firstquarter sank by 14.77 percent to P67.75 billion, from P59.03 billion in the same period in 2015.

On a month-on-basis, 2016 visitor receipts fell to their lowest in March at P18.31 billion, after hitting P21.94 billion in January, and as high as P27.5 billion in February.

Despite this, a DOT official denied the apparent slowdown in visitor receipts. In a text message, DOT Assistant Secretary Rolando Canizal told the BusinessMirror: “There is no slowdown and it doesn’t need to be compared month-onmonth. There are also certain factors to consider, such as length of stay, daily spend and the type

of tourists coming in, as well as destinations visited. The key message is receipts remain bullish with arrival growth.”

The slowdown in visitor receipts, however, reflect the deceleration in actual arrivals of the top spenders in the country. South Koreans, usually the largest spenders in the Philippines, accounted for 98,781 of total arrivals in March alone, spending only P4 billion. In comparison, February arrivals from South Korea were 137,598, and spent a staggering P13 billion.

China arrivals, actually slowed to 53,596 in March from a peak of 82,208 in February. While the Chinese were the third top spenders in February at P1.71 billion, the market did not register among the top 5 spenders in March.

From Ja nu a r y to M a rc h , South Korea accounted for the largest chunk of foreign visitors to the Philippines, with 383,544 arrivals, representing some 24 percent of total arrivals. In second spot was the United States, with 231,233 visitors (14.43 percent of total arrivals); followed by China, with 184,512 visitors (11.52-percent share); Japan, with 143,624 v isitors (8.96 -percent share); Australia, with 67,265 arrivals (4.2-percent share).

Other top-visitor markets for the Philippines include Canada, which grew by 14 percent to 53,301 arrivals; Taiwan, up 25 percent to 52,102 arrivals; the United Kingdom, with 49,097 arrivals (up 22.53 percent); and Singapore, with 44,441 arrivals (up 0.51 percent).

Visitors from Malaysia, however, dipped by almost 2 percent to 36,601, in the first quarter of 2016.

Among the top 12 markets, China posted a very high growth of 98.31 percent for the first quarter of 2016, followed by Taiwan with an increase of some 25 percent.

Other high-growth markets during the period of review, noted by the DOT, were India, with 22,121 arrivals (up 23.72 percent); France, with 18,417 (up 23 percent); Spain, with 7,748 (+30 percent), Sweden, with 9,870 (up 21.1 percent); Switzerland, with 9,390 (up 15.61 percent); the Netherlands, with 8,921 (up 16.2 percent); and Denmark, with 6,776 arrivals (up 29.34 percent).

The DOT added that cruise tourism is one of the fastest

1.6M The number of foreign tourists who visited the country in the first quarter

growing segments in the Philippine tourism, with close to 3,000 visitors brought in March alone by cruise ships that docked in the por t of Mani la. A lso, a b o u t 7, 3 0 0 v i s i t o r s c a m e through seaports in Palawan, of which 297 arrived via El Nido, and 6,959 arrived in the port of Puerto Princesa.

BMReports BusinessMirror

A4 Thursday, May 19, 2016

news@businessmirror.com.ph

Senators accept Duterte prerogative to give Cabinet positions to communist leaders, but...

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B B F

@butchfBM

ENATORS conceded incoming President Rodrigo R. Duterte’s “prerogative” to appoint members of his Cabinet, including known Communist Party leaders, but the lawmakers asserted all the nominees would have to undergo rigorous scrutiny and confirmation by the Commission on Appointments (CA), as required by law.

“It’s the President’s prerogat ive,” Senate Deput y Minority Leader Vicente Sotto III said, granting that Duterte’s Cabinet appointees “are supposed to have

his trust and confidence.”

Sotto noted, however, that appointing Cabinet officials is “just half of the story.”

“The other half is the CA. Will

they be confirmed? I do not know,” Sotto added.

Sen. Panfilo Lacson pointed out that “the choice of Cabinet secretaries is the sole prerogative and authority of the President, although, under the principle of check and balance, they will have to pass the scrutiny of the CA.” Lacson added: “Having said that, those who would be appointed have to take their oath of office and they must swear to protect and defend the Constitution of the Republic of the Philippines.”

“Then the issue of the Communist Party of the Philippines-New People’s Army-National Democratic Front not lay ing down their arms and abandoning their armed struggle to overthrow the duly constituted authority with the objective of taking over the government may have to be resolved first before they formally assume office,” said Lacson, a for-

mer ranking officer of the nowdefunct Constabulary.

Another former military man, Sen. Antonio Trillanes IV, also raised questions about Duterte’s announed plans to grant amnesty to all political prisoners, as well as four Cabinet posts to leaders of the Communist Party of the Philippines-New People’s Army (CPPNPA), for the sake of peace.

“While there is reason to be hopeful that the proposals to give the CPP-NPA at least four Cabinet positions and amnesty to political prisoners would lead to the end of the decades-old insurgency, we should be very prudent and very deliberate in our approach,” said Trillanes, a former naval officer linked to a failed mutiny against detained ex-President Gloria Macapagal-Arroyo.

He asked: “Do we really believe that Joma Sison will truly give up his communist aspirations?

The other half is the Commission on Appointments. Will they be confirmed? I do not know.”—S Would the political detainees to be given amnesty, like the Tiamsons, be swearing an oath of allegiance to our government and permanently lay down their arms?”

Lacson said every peace process, especially with a five-decade-old insurgency problem, should “start with good faith and goodwill.”

“Nevertheless, we must look at this move with guarded optimism.

Having said that, there might be some legal nuances to consider,” he said. “For one, most of the cases involving the political prisoners are pending with the different courts and, therefore, under the jurisdiction of a coequal branch of government, which is the Judiciary. Assuming that we set that aside, a question might

arise on how the cases involving soldiers and policemen allegedly committed in relation to their anti-insurgency operations will be treated.”

Asked by Senate reporters if the Duterte administration should cite conditions in exchange for the amnesty and Cabinet appointments for CPP leaders, Trillanes replied: “Most definitely.”

“There are requisites to such a generous offer,” Trillanes added.

“Otherwise, Joma Sison and the communists might take advantage of this and use this freedom, power and influence to actually strengthen their forces to pursue their cause, like what they did during the Cory administration. We should learn from history.”

Downgrading of powers of scandal-ridden OTS set B R L. M @rectomercene

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HE powers of the Office for Transportation Security (OTS), will soon be watered down.

This is the news that spread at the Ninoy Aquino International Airport (Naia) this week as all of the international airlines operating in the county held a series of meeting to prepared themselves for the coming transition.

The OTS, which is tasked to screen all departing passengers at major airports would be scaled-back and reports said it will soon perform oversight functions only.

The screening of passengers will be returned to the Civil Aviation Authority of the Philippines (Caap) and the Manila International Airport Authority (Miaa).

The Caap has jurisdiction over 84 airports in the country, including all major alternate airports. The Miaa, on the other hand, like the Mactan-Cebu International Airport, Clark International Airport Authority and Laoag International Airport, has its own mandate.

“We heard that the document demoting the OTS is now at the office of Secretary Joseph Emilio A. Abaya of the Department of Transportation and Communications [DOTC], said a member of the 40-strong Airline Operators Council, who asked not to be named because he is not in a position to speak on the matter.

OTS, the Frankenstein created

by Executive Order (EO) 331, is apparently being defanged after a series of tanim and laglag bala incidents at the premier airport. This has raised a hue and cry here and abroad over the mulcting scheme that victimized local and foreign tourists, especially overseas Filipino workers (OFWs).

The process of downgrading the OTS appears to have been hastened after presumptive President Rodrigo R. Duterte warned its personnel to stop the irregularity, or they will be relieved.

“Kayong nasa Naia, ’pag may tanim pa diyan… lahat kayo alis [All of you at Naia, if there’s still bullet planting there, all of you are out],” he warned in a televised interview in Davao City.

“I do not care even if your chief of office or your CO there knows or has nothing to do with it.”

The BusinessMirror tried several times to talk to OTS Spokesman Miguel Oraa to confirm the rumor of the OTS downgrade but he did not return the calls.

Why did it take so long for the OTS to be castigated?

Because it believes it has the

mandate, citing EO 331, signed in 2004 by then-President Gloria Macapagal-Arroyo, as the fountainhead of its vast powers.

Section 1 of EO 331 says: “The Office for Transportation Security [OTS] is hereby designated as the single authority responsible for the security of the transportation systems of the country, including, but not limited to: (a.) Civil Aviation, (b.)

Sea Transport and Maritime Infrastructure; and (c.) Land Transportation, Rail System and Infrastructure.

Such sweeping powers over land, sea and air remained unchallenged.

In return, the OTS receives a huge amount of funding that come from the fees collected at airports.

Last year, the office received P636 million, records indicate.

“Tucked into the airport terminal fee is the Aviation Security Fee [ASF].

Out of the P550 for international travel, P60 goes to the ASF, while of the P200 terminal fee for domestic travelers, P15 goes to the ASF,” Miaa Spokesman David de Castro said.

He said that there were roughly eight million international and nine million domestic passengers that flew out of the Naia in 2015.

On the other hand, the ASF is also collected from all flights departing from anywhere in the Philippines, de Castro added.

Data from the Miaa showed the domestic and international passengers reached more than 35 million last year.

Before the OTS, it was the Caap that does the security checking at all airports in the country.

This all changed following the September 11, 2001, (9/11) terrorist attacks on the New York Twin Towers.

Immediately following the 9/11 attacks, the US Congress enacted the Homeland Security Administration Act. Under it, the Transportation Security Agency (TSA) came about. It is chiefly concerned with air travel safety. The TSA employs screening agents in airports, armed federal air marshals on planes and mobile teams of dog handlers.

TSA representative Bert Williams came to the country and advised Philippine airport authorities to create a body similar TSA. “You should have a department with a single authority otherwise we will degrade your airport,” he was quoted as saying by Onie Nakpil, chairman of the Airline Operators Council-Association of Southeast Asian Nations (AOC-Asean).

Thus, the OTS was born, tasked to safety-audit all departing passengers at the Naia, not aware of the conflict it would soon create.

The Caap, on the other hand, believes that it, having been created by Republic Act (RA) 2427, it stands superior to the OTS that was created by a mere EO. Section 4 of R A 9497 said: “There is hereby created an independent regulatory body with quasi-judicial and quasi-legislative powers and possessing corporate attributes to be known as the Caap...attached to the DOTC for the purpose of policy coordination.

Under Section 75 on Police Authority, RA 9497 provides: “The Caap director general shall have the power to exercise such police authority as may be necessary within the premises of airports under its jurisdiction to carry out its functions and attain its purposes and objectives.”

Airline officials have questioned why the OTS, which is under the DOTC, should reign supreme over the Caap, which is an attached agency of the DOTC. “The Caap is a quasi-judicial and quasilegislative body, created

by Congress and existing under the mandate of the International Civil Aviation Organization,” said Caap Deputy Director General Rodante Joya to explain it’s pole position in the hierarchy of airport guardians.

He said he does not want to contest the claims of the OTS but leaves it to the DOTC to decide where to

grant the power to screen passengers.

On the other hand, Nakpil, asked whether the money from the Asf that is now being enjoyed by the OTS, should also be given to the Caap and the Miaa if the subsequent transfer occurs. He said the money should be able to provide salaries to employees conducting the screening process.

Nakpil opined that the decision to downgrade the OTS should be left to the incoming administration of president-elect Duterte.

Nakpil said that the OTS should also be reduced to a bureau playing an oversight role, to audit of what is going on regarding the implementation of security at the airports.

He added that all X-ray screening should be put under one agency, so that the finger-pointing would cease.

However, Joya said that oversight function is only enjoyed by government bodies that have regulatory powers.

“OTS does not possess that regulatory power,” he said.

“The DOTC cannot give the OTS oversight powers, it can’t override the law because OTS was created through an EO, signed by the President,” Joya pointed out.

To solve this dilemma, other aviation experts have suggested that Congress should create another law for the OTS to supersede RA 9497.

It was under these conflicting circumstances that OTS had survived.

Whenever something controversial occurs at the screening process, such as the bullet-planting scheme, the OTS does not accept the blame but point to the other agencies around and spread the culpability.

A lt hou g h c r it ic i s m s we re heaped on it during the height of the tanim-laglag bala controversy, it continues to exist apparently unscathed. The DOTC seems to have clothe the OTS with powers that exceeds or equal those of other agencies created by law.

Duterte probably has the Solomonic decision on what to do with the OTS when he assumes office in July, the airline operators said.

Airport scam

ELEVEN personnel assigned at the K alibo International Airport (KIA) have been sacked by the Caap after the agency found that they have been involved in a money-milking scam.

Involved in a scam wherein they issued to passengers used terminal-fee tickets that enabled them to pocket cash are terminal fee inspectors Daniva Acosta and Shane Alejandro; as well as terminal fee collectors Shiela Oirada, Cherry Peralta, Jojean Conanan, Precious Fernandez, Gerry Revister, Maria Briones, Andy Mel Jones Concepcion and Jovert Alejandro; and Flight Data Encoder Shamar Glenn Mabasa.

Caap Director General William K. Hotchkiss III said the investigation was headed by Joya, who also heads the agency’s Security and Intelligence Service (CSIS) Department.

The sacked employees, apparently, were “recycling terminalfee tickets for several months or possibly years, taking away a substantial amount of earnings from the airport.”

In Kalibo the terminal fee for a domestic flight costs P200, while a passenger is charged P750 for international travel.

“A show-cause order has been issued to the regular employee who works as a terminal-fee collector at the airport,” Caap Deputy Director General for Administration Artemio Orozco said.

Orozco said the CSIS has, so far, only found proof that the members of the group, removed from the agency, were involved in the scam in January and February this year.

He noted that the CSIS is probing deeper to determine how long the modus operandi has been going on at the KIA. “We cannot yet say how much of the airport’s earnings this group has taken through their scam of basically recycling terminal fee tickets until the CSIS concludes its investigation into how long the group has been involved in the modus,” Orozco said.

Asean

BusinessMirror

www.businessmirror.com.ph

Asean-EU business summit–two summits in the making?

Asean-EU Perspective

HENRY J. SCHUMACHER

W

ITH a combined GDP of $2.1 trillion in 2011, a wealth of natural resources and an enterprising and increasingly well educated work force, the 10 member-states that make up Asean possess the necessary assets to become a pillar of the global structure.

The world’s most powerful economies are focusing increasingly on Asean’s excellent performance and growth potential. China, for example, has invested substantially in the Asean countries, but threatens Asean with territorial claims in the South China Sea (West Philippine Sea). The Asean summit in Myanmar had China’s threat as one of the main topics on the agenda. The threat of China will unite Asean and will make the integration more urgent.

Asean represents the European Union’s (EU) fifth-largest partner, as trade in goods and services remain high. Europe is also by far the largest investor in Southeast Asia, with its companies accounting for an average of 20.6 percent of foreign direct investment (FDI) in recent years.

Asean governments and the EU leadership meet regularly, and the business sectors of Asean and the EU have responded by organizing the AseanEU Business Summit annually. The last business summit was in Hanoi in April 2013. The next one will be in 2017, when Asean celebrates its 50th anniversary and the Philippines assumes the chairmanship of Asean. European business in the Philippines would support such a move. We are sure that the EU-Asean Business Council, which is composed of European Chambers of Commerce in Asean and of medium to large European companies operating in more than two Asean countries, would support the move, too.

But before the Asean-EU Business Summit in 2017, we will organize a Philippine-EU Business Summit on October 4, to highlight the peaceful transition from the Aquino administration to the Duterte administration, to open a new page of Philippine-EU business cooperation and to identify win-win areas for business in both directions.

The EU-Philippine Business Network, cofunded by the European Commission, will use the business summit to bring small and medium enterprises missions from the EU member-states to the summit, to encourage regional European HQs operating in Asia to join the summit, and most important, to hand over to the Duterte administration the second edition of the “EU business in the Philippines advocacy papers.” Important is that this will be the first time for European business to formally interact with the new administration.

The EU-Philippine Business Summit in October will highlight also the Asean Economic Integration, which is turning Asean into a rules-based organization, with harmonized trade and investment laws and rules. There are three key areas of focus for Asean members: trade in goods, trade in services and inward investment or FDI. FDI is a key component of resource flows to Asean countries. Over the last decade, FDI flows into Asean members grew at an annual average rate of 19 percent.

Within the overall framework, each Asean country has adopted its own strategy to attract FDI. As in the EU, efforts to create a “level-playing field” between the countries in the single market leaves national governments with freedom to provide their own tax and other incentives to investors.

We are, therefore, pleased to note that the economic strategy of the Duterte administration includes to “ensure attractiveness of the Philippines to foreign direct investments by addressing restrictive economic provisions in the Constitution and our laws, and enhancing competitiveness of the economy.”

South China Sea activities need code of conduct–think tank

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EW DELHI—A code of conduct for navigation and other activities in the disputed South China Sea is important, a Chinese strategic affairs expert said on Tuesday, adding that international attention was concentrated on the region because there was no crisis-management mechanism in place.

“COC [code of conduct] is important,” Wu Shicun, president of the Beijingbased National Institute for South China Sea Studies (NISCSS) think tank told reporters in New Delhi at an event organized by the Chinese Embassy.

“A crisis-management mechanism is not there so everyone is worried,” Wu said, adding that in the many decades of the dispute, China had not taken any step to hinder normal navigation through the South China Sea. Other speakers at the event included Ye Hailin, deputy head of department, Institute of Asia-Pacific Studies, Chinese Academy of Social Sciences; and Zhang Junshe, senior researcher, Naval Research Institute of Chinese People’s Liberation Army Navy.

Since 2010 China and the 10 members of the Association of South East Asian Nations have been discussing a set of rules for rival claimants in the South China Sea aimed at avoiding conflict—

with little success.

China claims almost the whole of the South China Sea, through which more than $5 trillion of world trade passes every year, and has been increasingly assertive in staking its claim.

Brunei Darussalam, Malaysia, Vietnam, Taiwan and the Philippines have rival claims to parts of the sea, which is believed to have rich deposits of oil and gas.

Wu’s comments come days after China slammed an annual US defense department report to the Congress, which said China is expected to add substantial military infrastructure, including communications and surveillance systems, to artificial islands in the South China Sea this year. The Pentagon report said the planned addition of military infrastructure would give China long-term “civil-military bases” in the contested waters. It estimated that China’s reclamation work had added more than 3,200 acres (1,300 hectares) of land on seven features it occupied in the Spratly Islands in the space of two years.

The report said China had completed its major reclamation efforts last October, switching focus to infrastructure development, including three 9,800-footlong (3,000-meter) airstrips that can accommodate advanced fighter jets. MCT

Editor: Max V. de Leon • Thursday, May 19, 2016 A5

US eases sanctions on Myanmar to boost trade after elections $400M T HE US lifted sanctions on 10 businesses in Myanmar, as it seeks to reward the Southeast Asian nation’s transition away from decades of military rule and ease trade with one of the region’s fastestgrowing economies.

The Treasury department on Tuesday removed restrictions on seven state-owned enterprises and three state-owned banks that were on a blacklist. The shift comes after the Treasury last December allowed American businesses to use ports, toll roads and airports in the country, even though that could result in incidental transactions with individuals blacklisted by the US. The move is the latest sign of rapprochement between the US and Myanmar after more than two decades of hostility marked by the military government’s annulment of elections in 1990 and the house arrest of opposition leader Aung San Suu Kyi. After Myanmar’s military chiefs began instituting more

political freedoms, and Suu Kyi was freed, Barack Obama became the first American president to visit the country in 2012. He returned in 2014 to caution its leaders against backsliding on reforms.

Democracy dividend

“THIS is a potential market for our goods, a potential partner on critical issues and, important, a potential of an example of how a country can transition successfully from dictatorship to democracy,” Ben Rhodes, deputy national security adviser at the White House, said on Tuesday in Washington. “We have to demonstrate that there is a dividend for countries who go down this road.”

R hodes said the easing of

The value of Myanmar-US bilateral trade last year

sanctions is part of the Obama administration’s efforts to deepen its engagement with Myanmar, also known as Burma, while helping US companies participate in the country’s development. Trade between the two countries was about $400 million last year, according to International Monetary Fund (IMF) data. US investors in Myanmar include Chevron Corp., which explores for and produces oil and gas in the country.

Combined w it h reg u lator y changes allowing more transactions with designated financial firms, Treasury said Tuesday’s decision leaves few restrictions related to banks in Myanmar.

Economic expansion

FUELED by investments in energy, including natural gas, Myanmar has had one of Asia’s fastest-growing

economies. Foreign direct investment reached nearly $9 billion in the fiscal year ending in March. The economy will expand 8.6 percent this year and 7.7 percent in 2017, according to the IMF. Yet, the country remains one of Southeast Asia’s poorest.

As it moved toward democratic elections last year, the military barred Suu Kyi from running for president, ruling that anyone with foreign-born children was ineligible to lead the nation of 53 million people. Nevertheless, her party’s victory in the elections made Suu Kyi the power behind her choice as official president, Htin Kyaw, an exclassmate and longtime confidant.

To encourage further democratic reforms “and maintain pressure on targeted individuals and entities and the military, certain sanctions remain in place,” the Treasury said. Targets of those sanctions include those “who obstruct political reform in Burma, commit human-rights abuses in Burma, or propagate military trade with North Korea.”

The US State Department has joined human-rights group in criticizing Myanmar’s treatment of the the Rohingya, a Muslim minority castigated as illegal immigrants and stripped of citizenship. Bloomberg News

SINGAPOREAN Foreign Minister Vivian Balakrishnan (left) gestures, as Myanmar counterpart and de facto leader Aung San Suu Kyi watches, during a joint media conference in Naypyitaw, Myanmar, on Wednesday. Balakrishnan is on an official visit to Myanmar. AP

Malaysia govt may bar overseas travel for opposition

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ALAYSIA has begun enforcing a law that allows authorities to bar citizens who insult the government from traveling overseas, the Star newspaper reported.

Under the law, Malaysians may be banned from going abroad for three years for discrediting or ridiculing the government, and immigration officials started applying the rule several months ago, the paper said, citing a person it didn’t identify. Sakib Kusmi, director general for the immigration department, confirmed the legal provisions to the paper. A spokesman for the authority didn’t immediately respond to a call seeking comment.

Prime Minister Najib Razak has fired detractors, including his deputy prime minister, and curbed dissent to maintain his grip on power, as funding scandals led to the worst

The lack of such transparency and accountability only points to a government which is intent on abusing its powers to repress its critics and dissidents.”

—O  P

political crisis since he became premier seven years ago. Opposition politicians and Najib’s leading critics are on a public campaign aimed at ousting him, as questions linger over $681 million that appeared in his personal bank accounts before the last election in 2013. The attorney general ruled the funds were a donation from the Saudi royal family and Najib has consistently denied wrongdoing.

Opposition law makers and human-rights groups have condemned a decision to prevent an activist from going abroad this month. Maria Chin Abdullah, chairman of the Coalition for Clean and Fair Elections, or Bersih, wasn’t allowed to travel to South Korea on Sunday to receive an award, the group said in a Twitter post on May 15.

Bersih organized a major street

demonstration against Najib last year that drew an estimated 250,000 people, as protesters demanded Najib’s resignation. More recently, she was part of a “Save Malaysia” effort aimed at collecting signatures from ordinary voters in cities across Malaysia calling for the premier to step down.

Najib has already made greater of another antidissent measure, the country’s Sedition Act, to detain media executives and political opponents. Under Malaysia’s laws, the government doesn’t have to explain why anyone is barred from leaving the country, the official news agency Bernama reported on Monday, citing Deputy Home Minister Nur Jazlan Mohamed. Chin Abdullah can consult the immigration authority to find out the reason behind the ban, he was quoted as saying.

Bloomberg News

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Business

A6 Thursday, May 19, 2016

One nation united: Is Duterte’s fe BM R VG. C, D C, M T. C, J M N. D C, C U. O, M G C. P, C N. P  J R. S J

“Most cases would usually end within the state judicial system and should not be allowed to cross over to the federal judicial system,” he explained.

Vistan said if the state judicial system is simple and not as multilayered as what we have under the unitary-presidential form of government, then the disposition of cases may be hastened.

He said it would be ideal to three levels of courts at the most.

“Efficiency, however, would ultimately be affected by how the state courts are administered, the procedures they adopt in handling and deciding cases, and how these courts would actually handle cases brought before them,” he added.

the 1987 Constitution. Alvarez is being eyed as speaker of the House of Representatives in the Duterte administration.

He said Charter change (Chacha) and the revival of the death penalty will be prioritized in the 17th Congress.

“Revising the present Constitution [will be the first legislative item in the 17th Congress],” Alvarez said in a news conference. “Ang gusto ng ating bagong pangulo ay palitan ito into federal form [of government].”

He added t hey w i l l u nderta ke t he chang ing of t he Char ter t hrough a const it ut iona l convent ion (Con- con).

Other lawmakers earlier told the BusinessMirror they are “still carefully studying” the proposal to change the country’s form of government from republican to federal.

Party-list Rep. Neri J. Colmenares of Bayan Muna and Marikina Rep. Romero S. Quimbo said the next administration should be specific on his federal form of government proposal. “ We wa nt to hea r more spe c i f ic proposa l[s] f rom h i m ,” Col mena res sa id.

Quimbo, meanwhile, said he’s “not at all familiar with the concept, particularly, the form [the] incoming president has in mind.”

The so-called Visayan bloc, led

by Negros Occidental Rep. Alfredo D. Benitez, tackled the proposal on Wednesday.

T he 46 -member Visayan bloc has expressed support for Duterte’s legislative priorities, particularly on peace and order, poverty reduction, public health and education.

Judicial strength

Revisiting initiatives

M

ANILA and DAVAO CITY– HE’S excited. For Manuel, a confidential National Bureau of Investigation (NBI) staff, the excitement comes from the possibility of being regarded as an FBI agent.

That is, if the plan of Presidentelect Rodrigo R. Duterte to adopt federalism as a form of government comes into fruition.

“That could happen [changing the NBI into the Federal Bureau of Investigation], couldn’t it?”

Manuel said in an interview with the BusinessMirror.

Beyond the possible changes in labels of government agencies, Federalism has ramifications in a country that has grown used to considering its citizens in all the more than 7,100 islands follow a socio-political homogeneity.

There are, however, people like former Chief Justice Reynato S. Puno, who told BusinessMirror he has been calling for a shift from presidential-unitary form of government to a parliamentaryfederal system. Puno attributed the problems plaguing the country, such as graft and corruption, poverty, insurgency, weak judiciary and others, to the present system of government.

T here’s a l so L ito Mon ico Lorenzana, graduate of the Harvard University-Kennedy School of Government, who said he spent 40 years of his life advocating for federalism in the Philippines.

“Let me tell you the first anomaly: When the Americans that last controlled us gave us the presidential form of government, it was actually a form of government even alien to them,” Lorenzana told the BusinessMirror in Davao City, where Duterte reigned as elected mayor before being voted into president on May 9.

However, Puno and Lorenzana may have the gravitas as they advocate for Federalism, the push to unify the islands of the Pearl of the Orient is complicated.

Complicated vs tedious

UP College of Law Professor Edgardo Carlo Vistan noted, for one, that the current judicial system is incompatible with a federal system such that major changes would be necessary.

He explained to the Businessmirror that in a federal system, the judicial system will most likely be more complicated, but pursuing court cases may not necessarily be more tedious.

He said that most likely, a state or local courts will be created and administered by the various component states in accordance with their own laws.

“The independence that each component state will likely be granted in making laws effective within their jurisdiction will affect not only the variety of the judicial structures and systems across states,” he said. “But, more important the state laws that each Filipino will have to deal with in going from one state to another.”

He added that there will also be a federal system of laws and courts that would be distinct from those of the component states, adding another layer of complication.

“So, in many instances, one has to deal with both federal and state laws,” he pointed out.

But, he noted that not all court matters should be brought before both the state and federal courts.

₧1.034T The contribution to GDP in 2014 of the 6 regions of Mindanao according to BUSINESSMIRROR computation

PUNO believes the country’s judicial health can withstand the changes that would come with federalism. Puno indicated that, under the federal form of government the Judiciary can fully exercise its independence under the federal form of government as compared to the present system.

The Supreme Court, he said, “is one of its kind in the world” for having a vast power to strike down any laws and policies promulgated in grave abuse of discretion.

But, Puno noted, despite having such powers, independence of the Judiciary is “insufficiently insulated in our Constitution” considering that appointments in the Judiciary is tainted with politics.

“Undeniably, the judiciary has never been given its financial independence by the political branches of the government. Lack of financial resources is one reason the Judiciary cannot liquidate its backlogs of undecided cases,” Puno said.

Former University of the East Law Dean and constitutionalist Amado Valdez said the judicial branch is expected to function more efficiently under a federal form of government.

While the country may maintain the present setup of the Judiciary, a State High Court may be created for the speedy disposition of court cases.

“A decision of the State High Court may be appealed to the Supreme Court as court of last resort,” Valdez said. A State High Court, he added, would result in the abolition of the Court of Appeals.

“A State High Court in every federal state will surely expedite disposition of cases,” he added.

Charter change

THE momentum in the federalism tack could be expected to come from the Lower House.

O n We d ne s d ay re t u r n i n g Davao del Norte Rep. Pantaleon Alvarez said his leadership will prioritize a measure changing

FROM all indications, the process of getting to a federal form of government would be a circuitous route. This is why PDP Laban party president Sen. Aquilino Pimentel III has started revisiting previous legislative initiatives he led with LP Senator and fellow Mindanaoan Teofisto D. Guingona III, to start selling federalism to their Congress colleagues and the electorate.

Asked about the prospects of a bill on federalism in the current Congress, Pimentel said this would have already been included in the agenda of the proposed Con-con embodied in a resolution he and Guingona had earlier submitted for congressional approval.

“Filed na ang resolution on Con-con early this year pa,” Pimentel told the BusinessMirror, even as he clarified the envisioned agenda of the Con-con is “not necessarily” focused only on incoming President Duterte’s favored shift to federalism.

Saying the proposed change in the form of government will require revision of the Constitution, he confirmed their consensus is to let the Con-con tackle the matter.

“The preferred mode to amend the Charter is Con-con, not the current or future Congress (sitting as a constituent assembly),” Pimentel said. “Specific body ang Con-con to study Charter change.”

The senator added that once it is convened, “the entire Constitution is open to change.”

Asked if the current Congress can still pass the Con-con resolution so that the assembly can convene soon, he lamented that their proposal was virtually “ignored” by the Senate leadership and didn’t even reached plenary consideration.

“Hindi pinansin ’yun [Pimentel-Guingona] Resolution, hence, no more time this Congress. Sa next one na. I have to be realistic about it.”

But Pimentel voiced confidence that with Palace backing this time around, the refiled Con-con proposal will have a much better chance under a new leadership. “ Ne x t Cong ress it be wou ld i mpossible to ig nore suc h a reso,” P i mente l s a id .

Congress is key

AC C OR DI N G t o L o r e n z a n a , Congress is the key to the Federalism push. He said the three administrations that attempted to push for a federal form failed for various reasons, including the suspicion to preserve and extend their tenure in Malacañang.

But the common denominator of it all was Congress, which showed its natura l dislike for federa lism due to the common demand of people in the three s e p a r at e n at ion a l con s u lt a tions that they wanted an end to politica l dy nasties.

The two attempts during the term of former Presidents Fidel V. Ramos and Joseph E. Estrada were derailed over suspicion of term extension, while that of Gloria Macapagal-Arroyo reached Congress. Proponents, led by Lorenzana and former University of the Philippines (UP) President Jose V. Abueva, had to ask the Supreme Court to allow the federalism issue take its due course through the constitutionally guaranteed People’s Initiative.

The hope was booted out by one vote in the High Tribunal.

Lorenzana said federalism “is not just an overnight thing.”

“We cannot just legislate it tomorrow and then we have federalism,” he said. “It is a journey, and observes several principles, including subsidiarity, structural and institutional reforms and constitutional change.”

In a news conference on Monday, Duterte projected it would take two years to shepherd the process of getting people to approve federalism in a referendum, to be called after the enabling legislation is passed by Congress.

Political capital

IT is a common and logical view that any push for Cha-cha should start from the President and that its success depends on his political will and the trust that the people have in him.

Prospero de Vera, vice president for Public Affairs of the UP, said Duterte should do so while the iron is hot.

“It’s the correct move to push for federalism immediately at the start of his [Duterte’s] term because it is at a time when he has the biggest political capital,” de Vera said.

He pointed out that previous presidents had made the mistake of pushing for any kind of charter change later in their tenure, which resulted only in fear and agitation among the people as to the real intentions behind the moves for Cha-cha.

An example of this distrust is the failure of the administration of President Aquino to enact its charter change initiative. The outgoing administration confined itself only to the economic provisions of the Constitution to lift certain limits imposed on foreign ownership, ostensibly to minimize the peoples distrust for any moves to change the Constitution.

M r. A qu i no d id not pu sh for federalism, except for his support for the peace process with the Muslim secessionists in Mindanao, wherein his administration signed an agreement w it h t he Moro Islamic Liberation Front to establish a new autonomous entity, named the Bangsamoro Autonomous Region. The law, which would

have effected such agreement, however, did not pass Congress.

Isabela Rep. Rodolfo T. Albano III told the BusinessMirror the bill is a good template for federalism.

“We’ve been waiting for the proposal,” Albano said. “The best template is the BBL [Bangsamoro basic law] if it was passed,” he said.

He believes federalism will e mp ower prov i nces t h rou g h more authority and having their own funds.

Roxas solution

AQUINO’S anointed successor, Liberal Party standard-bearer Manuel A. Roxas II, echoed Mr. Aquino’s position against federalism. Roxas also countered that Duterte’s campaign for Federalism would not solve the problem of poverty in the countryside.

Roxas’s proposed solution is to pour more resources into the provinces to solve poverty and, consequently achieve peace and order.

Arroyo also had the same misgivings regarding federalism. She

argued the economic zones are not developed enough for the resulting federal states to stand by themselves without subsidies from the national government.

Ramos also tried to change the Constitution toward the end of his term, which was met with strong opposition because of his outright pitch for the lifting of term limits of public officials.

De Vera said these concerns regarding the details on the proposed federal system of government could pose obstacles to the Cha-cha movement, and should be addressed through the careful crafting of the proposed constitutional amendments, while taking into consideration the pecularities of the Philippines and its people to come up with a federal system that will work, instead of merely copying the different federal systems of other countries.

Resolving conflict

THE underlying agendum to resolve the conflict in Mindanao via federalism is a logical one, as

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ederalism PHL’s path to growth? the 2015 statistical yearbook, all 6 regions contributed some P1.034 trillion to GDP that year.

Based on the 2014 Gross Region Domestic Product (GRDP), only Davao Region posted a higher rate of economic performance at 9.4 percent from its GRDP of 4.1 percent in 2012.

This is the reason only Davao, the economic star among regions nationwide in 2014, was the only one that posted a poverty rate of 25 percent, better than the national average of 25.2 percent in the full year of 2012.

Economists believe federalism could be one of the most effective ways to spur growth and development in places like Mindanao.

University of Asia and the Pacific Vice Dean Cid Terosa said under a federalist form of government, small regions and municipalities will have a say in their development. Terosa said this will result in tailor-fit solutions that are designed to address area-specific economic and policy problems needed by the locale.

“The burden on the national government to alleviate poverty and unemployment will now be diffused to local regions or areas.

The NCR won’t be the focus of programs and projects that promote or facilitate growth,” Terosa said.

“Federa lism can, thus, reduce poverty and unemployment rates with an efficient, effective and enlightened federal government,” he added. “Initially, federalism will be administratively difficult to carry out since many regions or areas in the Philippines are prepared for it.”

Shrinking agencies

conflicts are among the reasons why economic growth and development have been slow in coming to the country’s largest island-group.

One is Mamasapano, the site of a massacre of 44 policemen. Located in Maguindanao province, it is among the poorest regions in the Philippines.

Poverty incidence in this municipality was pegged at 73.7 percent, according to the 2012 Small Area Estimates released by the Philippine Statistics Authority (PSA). Maguindanao province in part of the Autonomous Region of Muslim Mindanao (ARMM), where the poverty incidence rate averaged 48.7 percent in 2012, according to the PSA. The poorest municipality nationwide, Bacolod-Kalawi in Lanao del Sur with a poverty incidence rate of 84.8 percent in 2012, is also found in the ARMM region.

The National Economic and Development Authority (Neda) said armed conflicts and security problems in the area, as well as natural hazards that affect the agriculture

sector, where most of the poor depend on for their livelihood, are among the reasons many places in Mindanao are poor.

“It can also be partly explained by the high dependence on agriculture and the underperformance of the agriculture sector as a whole,” Neda Director General Emmanuel F. Esguerra earlier said. “We should note that more than 70 percent of all workers in the region are employed in agriculture sector.”

Benefits seen

MINDANAO’S land area covers six regions—the Zamboanga Peninsula, Northern Mindanao, Davao Region, Soccsksargen (South Cotabato, Cotabato, Sultan Kudarat, Sarangani and General Santos City), Caraga (Region XIII) and the ARMM. But the six regions in Mindanao only contributed 14.439 percent to the country’s total GDP of P7.16 trillion in 2014, based on constant prices. According to a BusinessMirror computation based on PSA’s 2014 constant GDP data in

FOR pundit Bienvenido Oplas, Federalism would mean there wou ld be shr ink ing of many national government agencies, including the Department of Agriculture (DA).

“If you have a strong and meaningful federalism, you have to shrink many national agencies, including the DA, in favor of the federal states or regions,” he said.

Meganomics Specialists International Inc. President Pablito M. Villegas explained this would mean the country will have a national agriculture agency, while each federal state or region would also have its own state-level or decentralized agency on agriculture.

Villegas said the national agriculture agency would focus more on policy making and strengthening of international trade.

He added the decentralized DA would focus on formulating strategic plans and programs in line with the national agricultural policy but will prioritize commodities and enter pr ises within the state. Doing so will give these federal agencies a comparative and competitive advantage based on the factory and resource endowments in the area and generate more employment for the population.

As the national and decentralized agencies would be able to focus on their respective functions, Villegas claimed federalism would be “advantageous” for the agriculture sector.

Ateneo Center for Economic Research and Development Director Leonardo A. Lanzona Jr., for his part, said this decentralization would also mean the agriculture structure would be more “responsive” to the needs of the farmers in their respective communities.

Oplas offered, as an example, t he weat her - ba sed dec i sionmaking that farmers do in every region. He said, as rainfall patterns in various areas tend to be different even during same periods, the planning of crops to plant should be a responsibility

given to the regions.

He added thatfederalism would also promote competition among the states or regions, as they would be given more leeway to decide on trade and fiscal policies.

“For example, if I am Masbate, I want to encourage agriculture processing here,” he said. “So I will offer them different types of fiscal or tax incentives and tell [these companies] come here instead of Negros or Cebu.”

“Or for example, if I am Manila, and I need produce like onion, garlic, etc., these islands would have to fight among themselves to get the market share in Manila,” Oplas added.

Infra possibilities

POLITICAL analyst Ramon C. Casiple said there are two ways by which the state can implement infrastructure development under a federal form of government.

“First is that a federal government has to get a local state to agree to a federal project,” said Casiple, who is also the executive director of the Philippine Institute for Political and Electoral Reforms.

Deals under the Public-Private Partnership (PPP) Program of the national government fall into this category. For example, the P19-billion Davao Sasa Wharf Modernization deal will have to be approved by the state of Southern Mindanao before being auctioned off.

This might prove to be quite problematic, especially since the local state will be given more power to implement infrastructure development deals on its own.

“The second one is that local states can undertake their own infrastructure-development projects and get outside financing on its own,” Casiple said.

Currently, local governments implement such projects also under the PPP scheme.

PPP Center Executive Director Andre C. Palacios noted, however, that infrastructure-development should not be stunted by any form of government.

“Infrastructure is urgently needed in the Philippines, whatever the form of government. If federal government means greater local autonomy and greater responsiveness to local needs, then we can expect more public spending for public infrastructure,” he said.

Trade and commerce

UNDER the federalist system in the United States, when it comes to the area of trade and commerce, the general guiding provision is found in its Constitution, the socalled Commerce Clause.

One interpretation of the said clause dictates that Congress has power to reg u late interstate commerce, commerce with foreign nations and commerce with Indian tribes. However, the scope and jurisdiction of this power, and Congress’s sharing of authority with state legislature is still highly debated. State legislatures often contest that the clause impedes their power to rule on economic activities within their jurisdiction.

In the Philippine setup, however, the regulation of trade and commerce in a federal government would largely depend on a strong Executive arm, notes a trade and investment lawyer.

“Federalist states in the US started off with strong, individual states,” Kristine F. Alcantara, managing partner of trade and investment firm AAA Law, said. “In Canada there’s the same, equally efficient system. This can possibly work with the Philippines if you have functioning local government units [LGUs].”

While the question of division of power in regulating trade and

commerce is difficult to answer, Alcantara remarked that a degree of autonomy, at least in determining the direction of a region’s economy, will be an advantage for self-determined growth.

“If federal states have more incentive to determine their own economy, to contract with private parties and incentive to grow on their own, they’ll have more incentive to grow,” Alcantara said.

airports, for instance, are other examples. Availability payments are subsidies given to private-sector partners for projects that are less commercially viable.

“There’s a difference between financing the project, and the private proponent getting repaid on their investments,” Canilao said.

“So, I think the provinces with high income are the only ones that can sustain infrastructure development under a federal system.”

FOR Bank of the Philippine Islands (BPI) economist Nicholas Antonio Mapa, proper backbone is still needed in the country before rushing to shift to a federal system of government, as it could post more harm than good.

“Federalism may offer some allure to the regions as it would seem to be a way to gain equity with long-standing imperial Manila,” Mapa said. “But changes to the economic landscape do not happen overnight, and in some cases, may not happen at all.”

The economist further elaborated that in federalism, states or regions that play host to more progressive cities or business districts have very different capabilities than the less-developed areas.

As such, switching to federalism, with the current gap between urbanized and rural areas, may widen the divide between the two.

“National budgets have been devolved in theory through the LGU code and, perhaps, the reason behind the economic disparity is not as closely linked to our current form of government as most would think,” Mapa said. “My fear is that with the current disparity, more developed regions would be able to offer much better business perks and tax cuts that less-developed areas would be hard-pressed to match. This would simply perpetuate the situation.”

As such, Mapa said more projects still need to be carried out in lesser-developed regions in the country to level the playing field.

“Connectivity is key in all forms, through transport and communications. The current administration has supposedly gone on an infrastructure binge by building more roads than previous administrations combined,” he said. “From this we can see how far we need to go before we get our infrastructure up to speed with the region.”

Studious market

Banking and Finance

Worries, concerns

THE push to a federal form of government has also prompted concerns from other sectors.

Lanzona expressed concern that the capacity and resources of local communities might not be enough to support agricultural production, so aid from the national government might still be needed.

For former PPP Center Executive Director Cosette V. Canilao, implementing infrastructure projects under a federal government would prove to be not so beneficial to provinces with low incomes.

“Among the local governments or provinces, there are only a few that can sustain infrastructure development under a federal system, like Manila, Cebu and Davao,” she said.

Canilao is worried on how lowincome provinces can implement their own PPPs, since there are two ways by which private sector can be repaid under the scheme.

“How are they going to make their own, PPPs—especially social infrastructure? There are two means by which private sector can benefit from PPPs, first is through user charges and the other being availability payments,” she explained. Examples of user charges are tariffs—payments collected when a certain facility is used.

Toll roads, railway systems and

FOR CEOs like Januario Jesus Gregorio B. Atencio III and Andoni F. Aboitiz, the federalism tack should be carefully studied.

Atencio, 8990 Holdings Inc. president and CEO, said the federalism proposal should be carefully studied by the Executive and the Legislative branches with wide consultations as possible because of its implications to business and society.

“The Local Government Code had already devolved a lot significant functions to the LGU. I doubt if there’s anything more that federalism can devolve at this stage. Besides, we can always devolve more functions to LGUs, which I think is the safer route,” Atencio said.

“Federalism might create citystate fiefdom and encourage more dynasties,” he said.

For Aboitiz, president and CEO of Aboitiz Land Inc., a property developer mainly in Cebu, said he will have look first the federalism proposal of Duterte in order for him to decide if it is good or not.

“There are many types of federalism. Which one they will possibly adopt we still don’t know at this point. We have to look at it first to determine if it is good for us a company and for the Philippines,” Aboitiz said.

Echoes of colonialism

ACCORDING to Lorenzana, the country must grapple with several problems that are echoes of its subservience from American colonial rule.

One of the problems, he said, is the “subservience to the national government in all aspects.”

The next problem would be to have adaptable horizontal and vertical structures, where the national government devolves the functions to LGUs. “[But] after several decades of political patronage, would Congress just give in their political influence to the locales who would be suspected also of building their own political influence?” he said.

He added that the structure of Congress, especially the Senate, is also an anomaly that federalism should be able to address.

“In the US’s presidential-federal form of government, when one elects the president, it carries with it the president’s running mate, unlike in the Philippines where each is voted separately, where we have the perennial bickering and separation with each administration,” he said.

And the senators are elected by each state, with each state sending two to the US Congress. “In the Philippines, the senators are elected universally, where eventually they think they are as powerful as the president,” Lorenzana said.

In 1935 the US colonizers formed only two political parties, the Liberal and Nacionalista, “which are basically the same faces of the same coin, and ruled by the same oligarchy.”

“The concept of governance here and the participation of the local governments failed because of the strong centralized power, that eventually give rise to political dynasties,” he said. “These are the anomalies of the Philippine type of democracy.”

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The World BusinessMirror

Rights group documents IS atrocities in Libyan city

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AIRO—A leading international rights group on Wednesday released a report documenting atrocities committed by Libya’s Islamic State (IS) affiliate in the country’s coastal city of Sirte, a stronghold of the militants.

3,000 The estimated total number of IS fighters in Libya

In the report, Human Rights Watch (HRW) recounts “scenes of horror” described by witnesses— atrocities that date back to February 2015 and include beheadings of dozens of residents accused by IS militants of being spies. The IS has gained a foothold in Libya amid the chaos that engulfed the country over the past few years,

torn between rival governments and a myriad of militias backing either side.

The report by the New Yorkbased watchdog also recounts instances of “crucifixions” and floggings of men for acts such as smoking or listening to music. The report is based on HRW interviews of 45 residents of Sirte conducted in March last year. The residents were among the two-thirds of the city’s 80,000-strong population that fled after IS overran Sirte.

“While the world’s attention is focused on atrocities in Syria and Iraq, ISIS is also getting away with murder in Libya,” said Letta Tayler, a senior terrorism and counterterrorism researcher at HRW, using an alternative acronym for the Islamic State group. US military experts estimated in April that the IS group has up to 6,000 fighters in Libya. However, Libyan military

intelligence officials have told HRW that the affiliate’s numbers do not exceed 2,000—70 percent of whom are foreigners. Estimates by other Libyan security analysts put the number of IS fighters in the country at 3,000.

In running Sirte, HRW said IS gave homes and all the goods seized from residents who fled to its fighters. Those who were accused of being spies or sorcerers were brutally killed, the rights group said.

The report comes just days after the US and other Western countries threw their support behind Libya’s newly formed and United Nations-brokered government, saying they would supply the government with weapons to counter the IS group.

This has sparked concerns of more arms being poured into this North African country already awash in weapons. AP

www.businessmirror.com.ph

Colombia battles world’s biggest drugmaker over popular cancer medicine

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OGOTA, Colombia— Colombia’s gover nment is giving pharmaceutical giant Novartis a few weeks to lower prices on a popular cancer drug or see its monopoly on production of the medicine broken and competition thrown open to generic rivals.

Hea lth Minister A lejandro Gaviria’s remarks in an interview on Tuesday are the strongest yet in an increasingly public fight with the world ’s biggest drugmaker that could set a precedent for middle-income countries grappling to contain rising prices for complex drugs.

Memos leaked last week to a nonprofit group, written from the Colombian Embassy in Washington, describe intense lobbying pressure on Colombia, a staunch US ally, from the pharmaceutical industry and its allies in the US Congress.

In one memo, the embassy warns that breaking Novartis’s patent for the leukemia drug Gleevec could hurt US support for Colombia’s bid to join the proposed Trans-Pacific Partnership trade zone and even jeopardize $450 million in US assistance for a peace deal with leftist rebels.

The memos followed meetings between Colombian diplomats and officials from the Office of the US Trade Representative and a Republican staffer on the Senate Finance Committee whose chairman, Sen. Orrin Hatch of Utah, has close ties to the pharmaceutical industry.

Gaviria, an economist by training, said the pressure shows the forceful steps that the pharmaceutical industry is willing to take to protect its commercial interests.

“They’re very afraid that Colombia could become an example that spreads across the region,” he said. Government health programs in many countries are being squeezed by high prices for newly launched drugs and by annual price hikes of 10 percent or more for medicines long on the market, and they are increasingly pushing back by demanding big discounts or setting price caps on ultra-expensive drugs.

Gaviria denies he is trying to

set a precedent in the global fight for lower prices.

“For us, it’s a question of survival,” he said. He noted Colombia’s health-care system guarantees patients’ access to all approved drugs and the budget is straining after years of price rises. In 2009 the government declared a publichealth emergency after spending on sophisticated drugs had risen tenfold in just a few years.

“As the state, you can’t just buy everything at the price set by whoever is selling. But unfortunately, that’s what happened many times,” Gaviria said.

Novartis has rejected Gaviria’s proposal to reduce the price for Gleevec to P140 (5 US cents) per milligram. That is less than half the current regulated price but still well above what generic versions cost before they were banned, when, after a decade of litigation, a Colombian court in 2012 awarded Novartis an exclusive patent on one of two forms of the drug.

In an April 20 letter, Novartis’s local affiliate said it doesn’t consider it convenient to initiate negotiations over prices and that the decision to override patents should be taken only in exceptional circumstances and not used as a bargaining tool.

Gaviria said he is giving Novartis a little time to reconsider. But if the Swiss company doesn’t, he said, he plans to declare access to the leukemia medicine a matter of public interest when he returns from a trip next week to Geneva to attend a meeting of the World Health Organization.

Gleevec has been the topselling drug for Novartis since 2012, bringing in $4.7 billion worldwide last year, or about 10 percent of the company’s total revenue. It won’t be the top seller much longer, though.

Gleevec got generic competition on February 1 in the US, which accounts for half of its sales. As a result, in 2016’s first quarter, Gleevec sales fell 40 percent in the US and 20 percent worldwide.

In Colombia the patent is due to expire in July 2018. AP

Overtime pay may become reality for more US workers

A PRODEMOCRACY activist (right), waves banner and shout slogans against progovernment protesters, (left) outside the convention center where the Chinese Communist Party’s third-highest ranking official, Zhang Dejiang, gave a speech during a visit to Hong Kong on Wednesday. AP/VINCENT YU

Hong Kong in lockdown as top Chinese official attends meeting

H

ONG KONG—Hong Kong authorities stepped up security for a top Chinese government official ’s appearance at a business conference on Wednesday, preventing prodemocracy protesters from getting anywhere close to the venue.

As many as 8,000 police officers were being deployed for the visit by Zhang Dejiang, the South China Morning Post newspaper reported, citing an unnamed police source. Zhang, the Communist Party’s No. 3 official, is the most senior Chinese leader to visit since pro-democracy street protests rocked the city for 11 weeks in late 2014.

About 100 protesters chanted “Zhang Dejiang get lost from Hong Kong” and burned a sign with the same message as they marched toward the convention center where Zhang was giving a keynote speech.

They also called for Beijing to stop interfering in Hong Kong’s affairs and to let it have genuine universal suffrage.

In 2014 thousands of residents took to the streets to show their

opposition to Beijing’s decision to handpick candidates running for the city’s top job of chief executive. Riot police clashed frequently with protesters at that time, once firing tear gas and later using pepper spray.

The protesters on Wednesday were kept back by a police security cordon that included hundreds of water-filled plastic barriers and metal barricades.

Aut hor it ies a re t a k i ng no chances as political tension over Hong Kong’s relationship with Beijing remains high. Residents are unhappy with Beijing’s tightening grip on the semiautonomous Chinese financial city. Calls for independence from activist groups, once unheard of, have become commonplace.

“Zhang’s visit to Hong Kong is just a political show,” said Avery Ng of the League of Social Democrats, a small, radical political party. “We need to remind the world that it is a fake show.”

Zhang “single handedly blocked the democratic path of Hong Kong two years ago,” when, as chairman

PROGOVERNMENT protesters hold both Hong Kong flag (left) and Chinese national flag outside the convention center, where Chinese Communist Party’s third-highest ranking official, Zhang Dejiang, gave a speech in Hong Kong on May 18. AP

of the National People’s Congress, China’s ceremonial parliament, he backed a plan to restrict the elections, Ng said.

In his speech on China’s “One Belt One Road,” a sweeping plan to deepen trade relations with neighboring countries and open new markets, Zhang made only a few indirect references to Hong Kong’s

relationship with the mainland.

He said China “ highly respects Hong Kong’s stability” and added, “we support strengthening its cooperation with the mainland and expanding its role in globa l f i n a nce. At t he sa me time, Hong Kong must do more to actively par ticipate in the countr y’s development.” AP

W

A SHINGTON—More than 4 million US workers will become newly eligible for overtime pay under rules to be issued on Wednesday by the Obama administration.

The policy changes are intended to counter erosion in overtime protections, which date from the 1930s and require employers to pay one-andw-a-half times a worker’s regular salary for any work past 40 hours a week.

In the fast food and retail industries in particular, many employees are deemed “managers,” work long hours, but are barely paid more than the people they supervise.

Under the new rules, first released in draft form last summer, the annual salary threshold at which companies can deny overtime pay will be doubled from $23,660 to nearly $47,500. That would make 4.2 million more salaried workers eligible for overtime pay. Hourly workers would continue to be mostly guaranteed overtime. The White House estimates that the rule change will raise pay by $1.2 billion a year over the next decade. In addition, some companies may instead choose to reduce their employees’ hours to avoid paying the extra wages.

“Either way, the worker wins,” said Vice President Joe Biden on a conference call with reporters

on Tuesday afternoon. Business groups, however, said the changes will increase paperwork and scheduling burdens for small companies and force many businesses to convert salaried workers to hourly ones in order to more closely track working time. Many employees will see as a step down, they said.

“With the stroke of a pen, the Labor Department is demoting millions of workers,” David French, a senior vice president for the National Retail Federation, said.

“Most of the people impacted by this change will not see any additional pay.” The overtime threshold was last updated in 2004 and now covers just 7 percent of full-time, salaried workers, administration officials said. That’s down from 62 percent in 1975.

The higher threshold, which will take effect on December 1, will lift that ratio back to 35 percent, Labor Secretary Tom Perez said. Perez has spearheaded the administration’s effort and worked on formulating the rule for the past two years.

The new rule is intended to boost earnings for middle- and lower-income workers, Perez said, which have been stagnant since the late 1990s. Overtime pay hasn’t gotten as much attention as nationwide efforts to increase the minimum wage, but it could have a broad impact. AP

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Japan’s economy grows faster than expected, but outlook weak

T

OKYO—Japan’s economy grew more robustly than expected in the first quarter of this year, at a 1.7-percent annual pace, but economists expect the expansion to slow in the current quarter.

1.9% The growth in Japan’s private consumption in annual terms in January to March

Solid consumer demand and higher gover nment spend ing helped offset relatively weak business investment in January to March. But data since then have been discouraging, and a major earthquake in southern Japan last month likely will drag on growth in this quarter, economists said. From the previous quarter, the economy inched up 0.4 percent.

“Japan’s GDP figures are notoriously volatile, and with output flat compared to a year ago, there can be no doubt that the economy is not doing well,” Marcel Thieliant of Capital Economics said in a commentary. In the fourth quarter, GDP contracted 0.4 percent. The recent weak data have raised expectations that Prime Minister Shinzo Abe may put off a planned sales tax increase due in April 2017 to prevent further disruptions, given the faltering progress toward a sustained recovery.

The worry is that raising the sales tax to 10 percent from the current 8 percent—a move already postponed once due to the outsized negative impact of the last sales tax hike—could hurt revenues more than help if the economy falls back into recession.

But holding off on the sales-tax

hike would undermine efforts to repair the government’s tattered finances. T he overall grow th figure likely got a small boost from the extra leap year day in February, economists said.

Private consumption, which accounts for the largest share of growth, rose 1.9 percent in annual terms in January to March, while public demand expanded by 2.6 percent. Business investment fell 5.3 percent and spending on housing also declined.

Under Abe, who took office in late 2012, Japan’s policymakers have tried to spur growth by pumping cash into the economy through central bank asset purchases, stronger public spending and other strategies meant to convince consumers and businesses to spend, by creating demand that would fuel a “virtuous cycle” of growth.

After three years, the recovery is still limping along. “Consumer spending made a solid contribution to growth in the first quarter, but weak business and residential investment prevented Japan’s economy from reaching escape velocity,” Bill Adams, senior international economist at PNC Financial Services Group, said in a note. A recent surge in the value of the yen, combined with a recovery in oil prices, has raised costs for businesses and cut into the profits of exporters. That has left them even less willing to invest or raise wages. Consumers, in turn, have remained frugal, nervous over the future outlook and likely cuts to public support for pensions and health costs. Japan’s Nikkei 225 stock index slipped 0.1 percent to 16,644.69, while the dollar was flat at ¥109.14. AP

Thursday, May 19, 2016

A9

briefs

FRENCH RAIL STRIKE DISRUPTS TRAIN TRAFFIC

PARIS—A rail strike has disrupted local and national train traffic in France, but not international lines. France’s national rail company SNCF says a third of the country’s high-speed trains are being canceled. Eurostar trains to London and Thalys trains to Brussels are expected to run normally on Wednesday. In Paris only half of suburban trains are circulating on certain lines. Paris subway is unaffected by the strike. Rail unions are protesting a plan to change working hours and rules about overtime and days off. AP

TRUMP FILES NEW FINANCIAL REPORT

WASHINGTON—Republican presidential candidate Donald Trump has filed new financial documents describing his personal wealth—and he isn’t waiting until they’re public to say they’re good. Trump announced late Tuesday he had submitted his candidate financial disclosure form to the Federal Election Commission.

He said it showed “a tremendous cash flow” and growing revenues from his businesses. The form— it will be publicly available after an initial review by the government—should offer updated information about the value of his assets and the revenues produced by his businesses. AP

TAIWAN PANDA’S ‘PROOF OF LIFE’ PHOTO DEBUNKS DEATH RUMORS

IN this photo taken on April 21, unaccompanied minors from Egypt, 16-year-old Fathi (from left), 17-year-old Saied, 17-year-old Gamal and 17-year-old Ayman, last names not available, sit next to the river Tiber after an interview with The Associated Press in Fiumicino, 30 kilometers west of Rome. All across Europe, there is a growing shadow population of thousands of underage migrants who are living on their own, without families. AP

Thousands of underage migrants live in shadows across Europe

O

UTSIDE the train station in Rome, teen migrants sell drugs from school backpacks and trade sex for cash or clothes. In the capital of Sweden they steal food from supermarkets and sleep on the streets.

From makeshift camps along the northern French coast, they try to hop at night onto the backs of moving trucks headed to Britain.

All across Europe, there is a growing shadow population of thousands of underage migrants who are living on their own, without families. They hide silently and in plain sight, rarely noticed in the crowd. Nobody even knows how many of them there are—Europol estimates broadly that at least 10,000 kids have gone missing from shelters or reception centers.

These unaccompanied minors are slipping through the seams of a European system strained to bursting, and they present one of the biggest challenges of the migrant crisis. The fact that accurate numbers are so hard to come by reflects the shortcomings of the bloc’s 28 member-states in implementing laws and guidelines that are supposed to protect asylum-seekers, in general, and unaccompanied minors, in particular. While the problem is not new, the sheer volume of migrants arriving last year has made it acute.

Like adult migrants, minors are flooding into Europe for both security and economic reasons, The Associated Press (AP) found in interviews with more than two dozen.

The question is where they end up.

Imran, a 13-year-old from Afghanistan, has passed through at least eight countries, mostly on foot,

and is now trying to make it from a squalid migrant camp in Calais to the United Kingdom. He dresses neatly in a donated sweat suit and tells his story politely. Only his gym shoes cracking at the seams and the cloud over his face hint at the hardship of his life, light years from his dreams of going to “doctor school.”

The Taliban shot Imran’s father when he was 8 or 9, and threatened to kill him, too, when he grew up.

He says he started to receive letters at his house. Frightened, his mother sold the building that provided the family’s income to pay smugglers for Imran to join his uncle in Britain.

Most nights Imran tries to sneak onto trucks to Britain—a dangerous venture, which the Afghans call “going to the game.” A 15-yearold Afghan died in January from sticking his head out and hitting an obstacle, and a 7-year-old who escaped Calais almost suffocated last month, after the locked truck reached Britain. It is not uncommon here to see migrants with crutches or other injuries from failed efforts to jump onto moving vehicles.

During the day, Imran looks haggard from lack of sleep. He has not talked to his mother in four months, and he describes life in the camp residents dub the Jungle as fit for “dogs and cats.” Imran is his nickname; the AP is not using the full names of children in this story to protect them.

“The hardest [part] for me, the first thing, is [my] mother. The second thing is [my] life. This is a s___y life,” he says, in what he calls Junglespeak English. “If my mother sees I’m in the Jungle, she will be very sad. I don’t want to tell her.”

Running away

IN 2015 almost 90,000 asylumseekers in the European Union (EU) were unaccompanied minors under 18, according to Eurostat. That’s up about nine times from just three years ago.

About half run away from asylum centers or shelters within two days of their arrival, according to Missing Children Europe, which represents nonprofits in 24 countries. Sometimes they are discouraged by how long it takes to get legalized, or fear being sent home or to the country where they first arrived. And sometimes they join family members, or just try their luck at asylum elsewhere.

European Union officials say they have developed projects to improve the reception of minors, provide them with health assistance and relocate or unite them with relatives faster. Germany, for example, provides minors who stay at shelters with about €30 to €70 ($39 to $79) a month in pocket money.

“European legislation pays particular attention to the rights and needs of unaccompanied minors seeking asylum,” European Commissioner Dimitris Avramopoulos told the AP. “Implementing these rules is therefore our priority.”

However, missing young migrants, most of whom are 14 or older, are treated very differently from missing children in general.

For example, the EU Fundamental Rights Agency recommends they be assigned a guardian responsible for reporting disappearances to police, but that seldom happens. Even when cases are reported, police seldom have

enough information to follow up, such as a photo of the child, personal data or fingerprints.

Suleiman, a 17-year-old from Morocco, ran away from a shelter several times before ending up on the streets of Stockholm in Sweden. Sweden gets by far the most unaccompanied minors applying for asylum—more than 35,000 in 2015. Last October officials in the port town of Trelleborg revealed that some 1,000 unaccompanied refugee children who had arrived over the previous month had gone missing. Suleiman, puffing on a cigarette, is one of dozens of Moroccan boys in Stockholm, where he and his friends steal food from supermarkets.

As a street kid in Morocco, he heard stories about how other poor people had left for Europe, and specifically Sweden. After several unsuccessful attempts, he managed to sneak aboard a boat leaving for Europe. He passed through several European countries before he got to Sweden.

There, he was sent to a refugee shelter in K iruna, a tow n of 20,000 people in the north, where the winters are dark and very cold.

The cold gave Suleiman back problems, he says. A lso, used to big cities with many people around him, Suleiman now felt he had nobody. After running away from the shelter several times, he was placed in compulsory psychiatric care, which he seemed to see as punishment.

“I hadn’t done anything,” he says. “First time I was there for two months, even though I wasn’t guilty of any crime or taking drugs.

Now I’ve managed to stay hidden

on the streets of Stockholm for over a year.”

At risk

THE biggest danger for minors on the move is that they will fall into crime, trafficking or illegal labor, which Europol expects to increase rapidly.

“They are vulnerable, no social network, weak links to national authorities, not understanding the legal procedures, sometimes being treated as illegals,” says Robert Crepinko, head of the migrant smuggling unit. “You can see all the boxes ticked.”

Abib, an Eg y ptian migrant who arrived in Italy as a minor and is now 18, acknowledges dealing drugs. “I buy €50 or €100 of drugs, and I can earn €200 or even €300 a day,” he boasts.

Sometimes, he says, people hire a minor to move big orders of drugs inside school backpacks for just €30 to €50. Sex trafficking also happens at the Termini station, he adds, in exchange for clothes or money. Emanuele Fattori, police chief at the station, says minors are used for drug trafficking because both the penalty and the chance of arrest are lower for them. And recently, he says, a pedophile priest was arrested for paying underage migrants at the station.

The temptation of crime and illegal labor is greater because so many unaccompanied minors are in debt. All 11 Egyptian teens the AP interviewed say they feel an obligation to pay back the substantial sums of money—usually around €3,000—their families paid for their passage to Europe with smugglers. AP

BEIJING—The subject of the photo looks out from behind bars, with newspapers arranged in front of him to prove what day it is. This “proof of life” shot is not a scene from a kidnapping, but an effort by the Taipei Zoo to debunk rumors that a prized panda recently died. Photos released by the zoo this week show 11-year-old Tuan Tuan looking at the papers laid out in front of his inner enclosure. The zoo’s director said in a statement that Tuan Tuan, his partner Yuan Yuan and their cub Tuan Zai are all fine. AP

JACK MA CANCELS KEYNOTE SPEECH AT ANTICOUNTERFEITING CONVENTION

NEW YORK—Jack Ma, the head of Chinese e-commerce giant Alibaba, is withdrawing from an anticounterfeiting convention in Florida just two days before he was scheduled to give the keynote speech.

Alibaba announced the move on Tuesday, following last week’s suspension of the company’s membership in the International Anti-Counterfeiting Coalition, a small but influential group that lobbies US officials and testifies before Congress. Ma is a selfmade billionaire, and Alibaba, which he founded in 1999, went public in 2014 in the biggest initial public offering of stock to date. AP

EXPECT V.R., A.I. FROM GOOGLE

SAN FRANCISCO—Google is expected to dive deeper into virtual reality (VR) and artificial intelligence (AI) on Wednesday during an annual conference that serves as a launching pad for its latest products and innovations. Although Google keeps its plans under wraps until the big event, the conference agenda makes it clear that virtual reality and artificial intelligence, or “machine learning,” will be among the focal points. That has spurred speculation that Google is getting ready to release a virtual-reality device to compete with Facebook’s new Oculus Rift headset, as well as the Samsung’s Gear VR and the Vive from HTC and Valve. AP

A10 Thursday, May 19, 2016 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Duterte brings high hopes for the nation

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HE landslide victory of Mayor Rodrigo R. Duterte on May 9 is a testament that his single-issue campaign focusing on law and order chimed with popular anxiety about crime, drug abuse, and graft and corruption. Duterte’s vote, goes the general consent, represents pent-up rage, particularly among the poor. The Financial Times said the “Philippines elected as president a populist wild man.” However, more than 16 million Filipinos would strongly disagree with such label.

Instead, they see in Duterte a savior who could deliver on his promise to end crime within three to six months of being elected president.

Filipinos are angry at the outgoing Aquino administration because it had seemed impervious to their plight as victims of economic inequality. All the talk about inclusive growth remained an elusive dream. In six years that President Aquino wielded the vast powers of the presidency, the country’s poverty rate had remained stubbornly fixed: About half of 101 million Filipinos failed to cross the poverty threshold, which means they have to live on P100 a day or even less than that amount.

The six years of broad economic growth under Mr. Aquino saw an annual GDP growth rate that averaged above 6 percent, making the country one of the world’s fastest-growing economies. However, that prosperity did not trickle down fast enough, and President Aquino and his administration were criticized as “too elite, too impersonal and out of touch.” Proof? The Aquino administration did not invest enough in infrastructure, roads, irrigation, communications and all other things that would make the lives of the people better.

With Duterte’s inauguration as the 16th Philippine President in June, hopes run high that his administration will bring about constructive progressive change anchored on peace and order. This early, the President-elect has vowed to introduce executions by hanging as part of a ruthless law-and-order crackdown that would also include ordering military snipers to kill suspected criminals.

Duterte said the centerpiece of his war on crime would be to bring back the death penalty, which was abolished in 2006 under then-President Gloria Macapagal-Arroyo. To do this, he needs Congress to reintroduce capital punishment for the crimes he hates: drug trafficking, rape, murder, robbery and kidnapping-for-ransom. What bothers human-rights advocates, however, is Duterte’s threat to give government security forces “shoot-to-kill” orders for those involved in organized crimes or criminals who resist arrest “so that lawless elements would learn to fear the law.” The law-and-order measures that worked well in Davao City will be rolled out nationwide, Duterte promised, adding that “those who destroy the lives of our children will be destroyed. Those who kill my country will be killed. Simple as that.

No middle ground. No apologies. No excuses.”

If Duterte will show everybody that nobody is above the law, pundits believe his peaceand-order campaign will get strong support from all sectors of society. There’s no doubt that people look at him as a political savior, with decisiveness and political will. Let’s hope our new President can make some good changes that will really help improve the lives of ordinary Filipinos.

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Why the ‘Dutertes’ are winning John Mangun

I

OUTSIDE THE BOX

F you want to be the leader of an organization—from your homeowners’ association to a country’s government—remember to say and live these words: “I have control of the situation.”

For the last year, I have been writing about the political-cycle change that has been engulfing the world and will continue to do so through 2017. A change in the cycle from the government to the people brings with it a “phase transition,” much like when liquid water turns to gaseous steam. That transition seems chaotic, but it is all part of the process.

The cycle change comes as government under the control of the “political elite” or the “powers that be” lose control. It is like an old car that, in spite of countless repairs, fails to properly perform any longer.

In its place, the people turn to strong leadership that can say with

confidence “I have control of the situation.” The political establishment dismisses this as a reaction from the “angry voter,” the “ignorant voter” and, most demeaning of all, the “populist voter.”

Leading candidates in the past year have been criticized as appealing to “populism” as if that is a bad thing. But populism is the appeal to the interests of the people, which would seem that a candidate should do and it usually comes from someone perceived as an outsider.

Indonesi a’s Joko “Jokow i ” Widodo had no strong connections to the Jakarta-based political elite that ruled for 70 years. His

San Miguel’s ‘A’ train Val A. Villanueva

BUSINESSWISE

T

HE project is expected to contribute no less than 5 percent of its yearly sales revenue, a trifle—or only a drop in the bucket—if you will, but San Miguel Corp. is determined to see it through until its completion in 2020.

The $1.54-billion Metro Rail Transit Line 7 (MRT 7) broke ground on May 20 of this year with no less than President Aquino, San Miguel President Ramon S. Ang, Transportation Secretary Joseph Emilio A. Abaya and Speaker of the House Feliciano Belmonte Jr. gracing the occasion.

San Miguel, under Ang, has always been in the forefront of nation-building since it decided to diversify into areas outside of its comfort zone. The company, Southeast Asia’s biggest publicly listed food, beverage and packaging firm, is also the country’s largest corporation in terms of revenues. It has over 17,000 employees in over 100 major facilities throughout the Asia-Pacific region.

For the longest time, its flagship product has been one of the most preferred beers and is among the world’s top 10 brands in sales, with

the company’s operations extending beyond its home market to Hong Kong, China, Indonesia, Vietnam, Thailand, Malaysia and Australia. Its products are exported to 60 markets around the world.

The yearly profit to be chipped in by MRT 7 to San Miguel’s bottom line may be puny compared with its other industries—fuel and oil (Petron Corp.); power generation, infrastructure (Skyway and Ninoy Aquino International Airport toll road)—but the benefits to be had from it are enormous for the country, which is in dire need of a viable infrastructure system.

So befuddling has the country’s infrastructure system become that Metro Manila’s notorious traffic jams have cost the Philippine economy at least P3 billion daily.

A Japanese study in 2012 found that time lost by people stuck in traffic, and the extra cost of

supporters’ campaign slogan was “Jokowi is us” but more accurately meant as in Widodo’s words, “Let’s go back to one Indonesia.”

Canada is a greatly diverse country with the western portion almost a “Little Hong Kong.” The most expensive house in Vancouver, British Columbia, was recently sold for $28 million to a Chinese “student.” Alberta Province is oil country and in a massive recession. French-speaking Quebec in the east still talks of autonomy. Justin Trudeau’s campaign slogan was, “I will be the prime minister of all Canadians.”

People have lost faith in government. Vladimir Putin faces down the West for “Mother Russia” and enjoys 90-percent approval rating, even as his people suffer economically. Turkey’s Recep Tayyip Erdoğan wants near-unlimited power to restore Turkey’s glory of the Ottoman Empire days. His popularity continues to grow. Indian Prime Minister Narendra Modi’s approval rating is at 70 percent. His recent campaign slogan was “This time, it’s Modi’s government.”

Donald Trump vows to “Make

operating vehicles in the congested roads of Metro Manila and nearby areas has amounted to P2.4 billion a day. With a burgeoning population and more cars on the roads, the P3 billion lost in terms of man-hours may even be an underestimation.

The government’s underspending has been deemed the culprit of this debacle. The Aquino administration has had difficulties in complying fast enough with new necessities to make public funding more transparent and corruption-free.

Ang’s visionary business sense is what goaded him to undertake the MRT 7 project. He knows that a progressive Philippines spells an economic boom for local business, especially for a well-entrenched company like San Miguel.

MRT 7 is a rapid transit line. Once completed, it will be 22.8-kilometer long, with 14 stations. It is projected to run in a northeast direction, navigating Quezon City and a part of North Caloocan in Metro Manila before ending in the city of San Jose del Monte in Bulacan province.

It will be a combined 44-km of road and rail transportation project from the Bocaue exit of the North Luzon Expressway (Nlex) to the intersection of North Avenue and Edsa.

The 22-km, six-lane asphalt road will connect the Nlex to the major transportation hub development in San Jose del Monte.

America Great Again,” as Hillary Clinton’s top campaign donors are the global bankers Citigroup, Goldman Sachs and JP Morgan, the group that the people blame for the financial crisis.

In the Philippines, Mayor Rodrigo R. Duterte says, “If elected president, I will get rid of corruption, drugs and criminality.” Hungarian Prime Minister Viktor Orban said: “We cannot permit even a chicken theft to remain unpunished.” Chinese President Xi Jinping said, “Some foreigners with full bellies and nothing better to do engage in finger-pointing at us.” That sounds familiar.

To quote Gideon Rachman, the Financial Times chief foreign affairs commentator: “All vow to lead a national revival through force of personality and willingness to ignore niceties.” That is what the people want now and that is why these leaders are winning.

E-mail me at mangun@gmail.com. Visit my web site at www.mangunonmarkets.com.

Follow me on Twitter @mangunonmarkets. PSE stock-market information and technical analysis tools provided by the COL Financial Group Inc.

The project is being implemented by newly formed SMC Mass Rail Transit 7 Inc., under San Miguel’s infrastructure subsidiary San Miguel Holdings Inc., with contractor Hyundai Rotem and EEI Consortium.

From an initial daily capacity of 350,000 passengers, MRT 7’s capacity will be increased to cater to over 800,000 passengers per day. Ang says that, at peak hours, MRT 7 will be able to accommodate 28,000 passengers per hour per direction, and can be scaled up to serve 38,000 passengers.

The new railway will provide relief to commuters who ply the heavily congested Commonwealth Avenue area to get to work or school on a daily basis. It is envisioned as an efficient, safe, fast and pollutionfree mode of mass transit for commuters. It will provide access to MRT 3 and Light Rail Transit 1, facilitate economic development in the area, and alleviate traffic conditions in Greater Manila area.

“For wage earners,” Ang asserts, “it means having more choices when choosing their place of work. It gives people better access to education and health care. For senior citizens and people with disabilities, an efficient public transport system will allow them to travel more freely and more conveniently.”

For comments and suggestions, e-mail me at mvala.v@gmail.com

Opinion BusinessMirror

opinion@businessmirror.com.ph

IMF’s call for a Greek One love in three debt holiday goes too far

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B M G | Bloomberg View

HE International Monetary Fund (IMF) is proposing that Greece’s official creditors grant the nation an extended payment holiday on its debts, according to The Wall Street Journal. It’s such a crazy idea that I hope it’s just a negotiating tactic designed to drag Germany to the debating table so that debt relief can at least be discussed.

Under the IMF plan, Greece wouldn’t repay interest or principal on its bailout loans until 2040, the newspaper said, citing officials familiar with the talks.

There’s no question that additional debt relief should form part of the package to help Greece restore its economic health. But the idea that German Finance Minister Wolfgang Schaeuble will accept a halt in all of Greece’s repayments for almost two-and-a-half decades, or that Chancellor Angela Merkel would want to go into next year’s German election, having granted what amounts to a debt amnesty to the euro’s most turbulent member, is absurd at best and dangerous at worst. There’s a risk, too, that the IMF’s relations with Greece’s other creditors are becoming so strained as to imperil the entire bailout process.

Here’s a chart showing Greece’s debt payment schedule for the next few years, courtesy of my Bloomberg News colleague Nikos Chrysoloras:

Msgr. Sabino A. Vengco Jr.

ALÁLAONG BAGÁ

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O the glory of God is the human being given so much dignity despite frailness and weakness in comparison to the heavenly bodies (Psalm 8:4-5, 6-7, 8-9). In our relationship with the Triune God, we are certain of the love of the Father, made incarnate in Jesus Christ and ever present in the Holy Spirit (John 16:12-15).

Whole Earth full of God’s glory PSALM 8, a hymn of praise to God, depicts the psalmist spellbound by the wonders of the universe and by the role of human beings in it. The heavens come to them as work of God’s fingers; the moon and the stars once thought to be celestial deities are His creatures. In comparison to their grandeur, man is so puny and fragile (“enosh”—a mortal, and “ben adam”—from the soil), yet, the Creator is mindful of them and has shown provident care for them. In fact, God has made human beings just a little less than the “elohim” (literally the “gods”), i.e., supernatural beings or the “angels”, and as such,

entrusted them with the authority to rule over creation. Like royalty, man is pictured as crowned with honor and glory, and other creatures “under his feet” owe him fealty.

Job (7:17) could not help but ask God who alone can answer his question, “What are human beings, that You make so much of them, that You set your mind on them?” Reflecting on the Genesis story (1:26), the psalm is echoed by the Book of Wisdom (9:2): “By Your wisdom You have formed human beings to have dominion over the creatures You have made and rule the world in holiness and righteousness.” This incalculable gift and task for man

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in God’s likeness is now fulfilled in Jesus Christ. For “God has put all things under the feet of Christ and has made Him the head over all things...the fullness of Him who fills all in all” (Ephesians 1:22-23). “We do not yet see everything in subjection to Him. But we see Jesus, who for a little while was made lower than the angels, now crowned with glory and honor” (Hebrews 2:8-9).

In the Holy Spirit

TO prepare His followers for things still to come, Jesus focused on the Holy Spirit who will accompany them. The Spirit of truth will come to them and guide them to all truth of the teaching and way of Jesus, which presently they cannot yet fully grasp or bear. The Holy Spirit, coming from the Father in the name of the Son from the very unity of the Divine, will tell them of what is “heard” within the divine communion and announce to them things to come, mysteries and expectations that will be brought to fulfillment.

The Holy Spirit given to humankind will fully glorify Jesus and reveal Him as God’s chosen one by unfolding the depths of the myster-

Simplified taxation for MSMEs The debt burden is such that the entire €10 billion ($11.3 billion) of additional aid Greece is expected to receive from euro-region finance ministers meeting on May 24 will disappear into servicing its debts in June and July (although some of it is in treasury bills, which the country’s domestic banks will continue to fund). Then, come July 2017, another €7 billion is needed.

The IMF is correct when it says rescheduling is essential if the country is to be on a viable path to recovery. But suspending all debt payments until 2040 is never going to be acceptable to Greece’s lenders, especially Germany.

The IMF also insists that a system of automatic triggers be put in place that would impose additional austerity measures worth about €3.5 billion if Greece fails to meet the objectives outlined in its bailout package. But there is little sense, either political or economic, to the idea that a nation struggling to grow its economy by enough to hit its targets would be punished by preprogrammed cuts if it falls short.

Greece’s growth outlook remains lackluster at best. Tourism contributes more than 18.5 percent to the country’s GDP, according to the World Travel & Tourism Council. But last week Greek Tourism Confederation President Andreas Andreadis warned that weakness in the first four months of this year threaten this year’s target for €15 billion of revenue, and may mean 2016 is even worse than last year.

The IMF proposal to let Greece completely off the hook comes at a tricky time. The June 23 UK referendum on whether to quit the European Union (EU) has boosted other anti-European political forces in the bloc. The EU economy is still fragile, with 13 percent of economists still seeing a risk of a euro-zone recession in the coming year, according to a Bloomberg survey earlier this month.

Forgiveness of the kind the IMF counsels may harden sentiment against the EU in core members, further weakening ties.

More realism is needed from all the participants at next week’s meetings. Germany needs to accept that limited debt relief makes sense, not least so that Greek Prime Minister Alexis Tsipras has something to sell at home, where his political position is shaky at best. The IMF needs to be less doctrinaire in its economic demands, and recognize that the primary surplus targets it advocates are too onerous. And Greece needs to improve on its limited progress in dealing with the nonperforming loans that hobble its banking sector, and in accelerating the sale of state-owned assets to raise much-needed cash. Otherwise, the euro zone faces the prospect of a repeat of last year’s existential crisis that threatens the integrity of the common-currency project.

Germany is very, very tired B J M Bloomberg View

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VER the past few days the Brexit referendum has taken a nasty turn, with Boris Johnson, the former mayor of London and a prominent “leaver,” comparing the European Union (EU) to Adolf Hitler and complaining about Germany’s growing power in the EU. He should visit Berlin, which I did last week. Far from wanting to rule Europe, Germany’s leaders seem increasingly worn out by its endless crises and, from their point of view, downright ingratitude. This growing fatigue in the continent’s already reluctant hegemon could spell as much trouble for the EU as Brexit does.

Postwar Britain famously lost an empire but couldn’t find a role; now, Germany has acquired an empire of sorts, but can’t work out how to run it. All of Europe’s problems—the flood of Syrian refugees, the euro crisis, Vladimir Putin’s belligerence, the euro zone’s anemic growth, Eastern Europe’s drift toward rampant nationalism, Brexit—keep landing

in Angela Merkel’s lap. Germany’s chancellor has usually found some way to cope, most obviously by kicking each problem down the autobahn. But she lacks the power (and too often the inclination) to lead Europe, while her partners, even when they don’t obstruct her, do very little to help. So the problems drift, and frustration in Berlin mounts.

Look, for instance, at Europe’s two main enduring crises. On Sunday the Greek parliament is supposed to approve another package of structural reforms, prior to a meeting of euro-zone finance ministers in Brussels on May 24. Greece needs another dollop of aid to meet its July interest payments, but the International Monetary Fund (IMF) has been (rightly) worried that the country’s debt burden is too big and it will miss its target of a 3.5-percent primary surplus in 2018. A Merkellian fudge has been readied: In return for the new reform package, Germany and the IMF will accept some of Greece’s more heroic forecasts and stretch out debt repayments.

The classification is based on asset value following the definition of MSME under Republic Act 9178, the Barangay Micro Business Enterprise law of 2002. Microenterprises are those with assets of not more than P3 million, small enterprises from P3 million to P15 million and medium enterprises from P15 million to P100 million.

Of significant mention are the microenterprises of more than 900,000 and described in a report as pertaining to those operating in the informal economy, not registered, not keeping books of accounts and not paying their taxes. These are the home-based businesses, small start-ups, single proprietors, individual service providers and the like. I must emphasize, there are more than 900,000 MSMEs out there operating beyond the borders of our tax laws.

This information is alarming but expected, considering the high tax rate and complicated tax system we have in the country. We hear of many stories where small and micro businesses would want to pay their taxes but ends up not doing so because of two reasons—first, the tax cost is too high to cause the closure of the business, and second, there is fear of inability to comply or sustain compliance because of the difficult and costly processes and requirements.

There are two models of a tax system—that which is complicated but fair and the other is simple but practical. Complexity in tax rules results from a desire to remove inequity and provide a fair system of taxation. Thus, the choice is between fair but complicated vis-à-vis simple but practical. The Philippine tax laws are patterned after

US, which follows the first model.

Other countries have chosen to sacrifice a bit of fairness in favor of practicality and simplicity. One good example is Singapore.

But in an economy where 90 percent of businesses are small and micro enterprises, a complicated tax structure exacerbated by a high tax rate, like ours, simply does not work.

It does not and it will not work. Considering the profile of our taxpayers, 90 percent of which are micro and small, a complicated tax structure will only spur the growth of the underground economy and encourage noncompliance, especially in an environment where the chances of being caught is low, and even if caught, may still go unpunished or infractions fixed.

The taxation of MSMEs deserves a second look. MSMEs are a distinct segment of the taxpaying population that deserves a special tax regime.

After all, they are the principal drivers of inclusive growth and while their contribution to government revenue may be small, they employ around 65 percent to 70 percent of the total work force.

What MSMEs need is a simplified form of taxation to encourage them to comply, help them grow, until they are ready to join the mainstream.

Simplification should include simplified bookkeeping, simplified forms, simplified tax base (i.e., use of presumptive income bases, or final withholding taxes), reduced frequency of tax filing, file and pay anywhere,

Default has, thus, probably been skillfully averted again. But nobody in Berlin believes Greece will ever be able to pay off its debts. “It is really an emerging economy, not a developed one,” says one senior German, adding wryly that the Greeks should be dealing with the World Bank, not the IMF. Worse, from Germany’s perspective, the lack of progress in Greece is symptomatic of the whole continent’s uncompetitive economy. Six years into the euro crisis, France has barely started structural reform (German ministers roll their eyes whenever you mention “François Hollande” and “reform” in the same sentence), and Italy is still trying to fix its banking system. The single market is worryingly incomplete.

Very few of the structural underpinnings of a successful single currency are in place.

This contempt comes with a hefty dose of hypocrisy and self-delusion.

Merkel has done few structural reforms herself; the hard work was done by her predecessor, Gerhard Schröder. Content in their prosper-

ous economic bubble, German voters have condemned the rest of Europe to needless austerity, resisted liberalization (notably in the country’s lackluster service industries), and refused to stomach common Eurobonds and other long-term solutions to preserving the single currency. So the Germans are not the thrifty saints they imagine themselves to be. But, as they endlessly point out, they are the ones who write the checks every time there is a bailout —and they don’t feel as if they get a lot in return.

Germans have more justification for their resentment when it comes to Europe’s other main crisis: the flood of Syrian refugees. On the plus side, Merkel has found a way to stem the flow of people that threatened to overrun her country (and her chancellorship). Turkey has agreed to hold refugees within its borders in exchange for €6 billion in aid from the EU, while Italy and Greece are also getting help in exchange for not letting refugees who land on their coasts surge northward.

These deals have brought some

relief in Merkel’s court—but not without nervousness and reproach.

Nervousness, because the deals are fragile: Turkey’s President Recep Tayyip Erdogan is already howling about the terms of his (“Since when are you controlling Turkey?”).

Reproach, because when Merkel pleaded for help, she got precious little assistance. While Germany has taken in perhaps 1 million refugees, Britain and France have each absorbed a fraction of that. Eastern Europe, which Germany helped rebuild, was more rudely uncooperative. And what, Merkel’s lieutenants wonder, will happen if the refugees start coming again?

So it is no wonder that Germany feels fatigue. A decade into her chancellorship (a somewhat tiring milestone for any government), Angela Merkel must have found Boris Johnson’s remarks ironic. Rather than dominating Europe, she has merely the same sort of negative clout that Barack Obama has over much of the rest of the world: She can often stop things, but rarely cause them to happen. Part of that

Atty. Benedicta Du-Baladad

TAX LAW FOR BUSINESS

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ARGE businesses operating in the Philippines are insignificant compared to micro, small and medium enterprises (MSMEs) in terms of numbers. This is based on a 2013 Department of Trade and Industry report which shows that, out of a total of 941,174 business establishments, there are only 3,847 (.4 percent) large enterprises.

The rest, which comprise the 99.6 percent, or 937,327 enterprises, are MSMEs. Of the total MSMEs, 90 percent are microenterprises.

ies Jesus proclaimed. The mission of the Spirit to instruct the disciples about all truth, grounded on what Jesus taught, goes beyond into and back to the Father. What belongs to the Father belongs to Jesus. What the Spirit declares of Jesus has been heard also from the Father, and it is the Father who sends the Spirit to bring the work of Jesus to full fruition. The glorification of Jesus by the Spirit means the full revelation of God’s plan of salvation, which is man’s “deification.”

Alálaong bagá, what the psalm intimates of God’s special providence and care for us human beings is brought to its fullness in the coming to us of the Holy Spirit, as promised

by Jesus and as sent by the Father to continue Jesus’ mission of redemption and sanctification and to lead us ever deeper into the truth that is ultimately God. The Triune God’s involvement with us and for us elicits wonderment and praise, gratitude and commitment. Yes, as God cares so much for us, we too can care enough for one another!

Join me in meditating on the Word of God every Sunday, 5 to 6 a.m. on DWIZ 882, or by audio-streaming on www.dwiz882.com.

reduced compliance requirements, dedicated fast lanes and assistance at Bureau of Internal Revenue Centers, among others.

In addition, a lower tax rate for MSMEs should be considered. Malaysia, Thailand and Vietnam have adopted a two-tiered corporatetax rate, where a lower rate of tax is applied to MSMEs. In Malaysia, for example, the tax rate imposed on MSMEs is 19 percent, which is 5 percent lower than the regular rate of 24 percent. Thailand, on the other hand, imposes a 10-percent tax on MSMEs, compared to the 20-percent regular rate, while Vietnam passed a law reducing the tax rate to 20 percent and which was applied retroactively for MSMEs. In the Philippines the same rate of 30 percent applies to all uniformly.

In this period of Asean regionalization, should we not do something to help ease the tax burden of our MSMEs, too?

is her fault: If she had dared to get ahead of the euro crisis, rather than sticking various Band-Aids on it, she might have staunched it. But Germany is reluctant to lead, and the rest of Europe is reluctant to follow.

Domestic politics don’t make this any easier: The rise of the Alternative for Germany party, Germany’s version of euroskepticism, is partly based on its claim to tell the harsh truths about the EU that Merkel keeps papering over. If Merkel, who is still trusted, were to leave, chances are that her successor would have far less leeway to negotiate on Germans’ behalf.

The overriding worry is that a vicious cycle has begun: As Germany gets ever more frustrated with Europe’s inability to change, it gets ever less likely to lead, so the change it wants becomes ever less likely to happen. In a strange way, Brexit might alter this dynamic. Merkel is desperate to keep Britain within Europe because she sees David Cameron, for all his Little Englander elements, as a voice for reform.

The author is the managing partner and CEO of Du-Baladad and Associates Law Offices (BDB Law), a member-firm of World Tax Services (WTS).

The article is for general information only and is not intended, nor should be construed as a substitute for tax, legal or financial advice on any specific matter. Applicability of this article to any actual or particular tax or legal issue should be supported therefore by a professional study or advice. If you have any comments or questions concerning the article, you may e-mail the author at dick.du-baladad@bdblaw.com.ph or call 4032001 local 300.

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A12 Thursday, May 19, 2016

www.businessmirror.com.ph

Cha-cha high on 17th Congress agenda

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ETURNING Rep. Pantaleon D. Alvarez of Davao del Norte, who is being eyed as Speaker of the House of Representatives in the Duterte administration, on Wednesday said his leadership will prioritize a measure changing the 1987 Constitution.

Alvarez said the Charter change (Cha-cha) and the revival of the death penalty will be prioritized in the 17th Congress.

“Revising the present Constitution [will be the first legislative item in the 17th Congress]. Ang gusto ng ating bagong pangulo ay palitan ito into a federal form [of government],” Alvarez said in a news conference. He said they will do the Cha-cha through a constitutional convention.

Also, during a lunch hosted by the lower chamber’s Partylist bloc on Wednesday, Alvarez expressed confidence he can get the speakership from Speaker Feliciano Belmonte Jr. in the next Congress.

Alvarez said at least 80 lawmakers are set to join the Coalition for Change of Partido Demokratiko Pilipino-Lakas ng Bayan (PDPLaban) of presumptive President

80

The estimated number of lawmakers that are set to join the Coalition for Change Rodrigo R. Duterte.

The incoming lawmaker said he w i l l a sk t he coa l it ion to support Duterte’s call for aChacha and the restoration of the death penalty.

“We respect their opinion on the matter, but the President campaigned on the basis of that

platform. People voted for him to effect that change,” Alvarez said.

He said he has the support of big political parties, namely, the Nacionalista Party, the National Unity Party, the Nationalist People’s Coalition and the lower chamber’s party-list bloc.

Alvarez was a former lawmaker during the 11th Congress and a former transportation secretary during the term of President Fidel V. Ramos.

Belmonte said he would still join the 17th Congress speakership race.

“Well, I’m still the leader of the House of Representatives. Aside from being Speaker, currently, I’m the de-facto leader of the Liberal Party in the House, which comprises 100 to 120 people, unless my party mates choose another person which is okay with me,” Belmonte said.

Belmonte, who was the campaign manager of the Liberal Party, is eyeing a third and final term as speaker of the Lower House.

He earlier said he will form a “super majority” bloc in the Lower House capable of shielding Duterte from any impeachment attempt and be supportive of his legislative agenda.

“Under me, they will be supportive of Digong’s programs and can form the nucleus of his super majority,” Belmonte added.

Jovee Marie N. Dela Cruz

VISUALIZED This May 16 photo shows people near a wall displaying a work of art, one of many on buildings at the Bonifacio Global City during the 10-day mural art festival. The festival features a mix of international and local artists painting across the BGC business and commercial district. Building on last year’s successful arts and cultural initiative, the organizers hope that the size and scope of this project will “continue to be a transformative event.” NONIE REYES

SC won’t lift stay order vs transfer of common station B J R. S J

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@jrsanjuan1573

HE Supreme Court has ordered the Regional Trial Court (RTC) of Pasay City to hear and resolve with dispatch the damage suit filed by SM Prime Holdings Inc. (SMPHI) against the Light Rail Transit Authority (LRTA) and the Department of Communications and Transportation (DOTC) in connection with the construction of the common station interconnecting Light Rail Transit (LRT) Taft and the Metro Rail Transit (MRT) Edsa.

In a 22-page resolution, promul-

gated on April 18, and released to the media only on Wednesday, the Court’s First Division also denied the motion of respondents LRTA and the DOTC to lift the July 30, 2014, temporary restraining order (TRO) it had issued enjoining LRTA and the DOTC from proceeding with the transfer of the common station in front of SM City North Edsa to the new site in front of TriNoma Mall in North Avenue, Quezon City.

It a lso defer red action on SMPHI’s petition for injunction until the finality of any decision in the civil action before the RTC in Pasay City Branch 111.

The Court also directed the parties to immediately inform it of any final judgment in the civil case, or any other circumstance that would merit the lifting of the TRO. In its petition, SMPHI assailed the decision of the DOTC and LRTA to build the common station interconnecting the LRT Taft, the MRT Edsa and the forthcoming MRT 7 in front of the TriNoma Mall.

The petition claimed the move was in violation of a memorandum of agreement it signed with LRTA on September 28, 2009, to construct the common station in front of SM City North Edsa.

Obama congratulates Duterte

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RESIDENT Barack Obama offered his congratulations on Tuesday to the new presumptive President of the Philippines, who has attracted controversy over his iron-fisted approach to law and order.

The White House said Obama and Rodrigo R. Duterte spoke by phone in their first conversation since Duterte declared victory in the May 9 vote.

Obama noted high-voter turnout in the election was a sign of the Philippines’s “vibrant democracy,” and he highlighted the two nations’ “shared commitments to democracy, human rights, rule of law and inclusive economic growth,” a statement said.

Duterte has been a controversial character in Philippine politics. The longtime mayor of

Macau. . .

C  A

Macau’s VIP revenue, as measured by their favorite baccarat card game, was worth $16 billion last year, after plunging by 40 percent from 2014.

The middlemen, who loan money to high-end clients to gamble, have quickly moved business to countries, such as the Philippines and Vietnam, where phone betting is allowed after Macau’s sudden ban, said Tony Tong, vice chairman of

Davao campaigned on a promise to end crime and corruption. His public threat to kill all criminals helped catapult him to the presidency, but has alarmed human -rights activists.

Deputy National Security Adviser Ben Rhodes acknowledged the controversy over some of Duerte’s past statements, but he said the US wanted to build on the “good progress” made between the allies under the outgoing administration of President Aquino.

“For us, the priorities will remain the security and prosperity of the Philippines. We’ll want to see continued efforts in the Philippines in respect of rule of law and to combat corruption, just as we support those types of efforts across Asia and around the world,” Rhodes told the Center for a New

American Security think tank.

“We believe that now as much as ever, it’s important that the US and the Philippines are seen as working together and also working with a network of allies and partners in Southeast Asia,” he said.

The historically tumultuous relationship between the US and its former colony has thrived in recent years, as the Philippines has turned to Washington for suppor t against an asser tive China with which the Philippines has territorial disputes in the South China Sea. On Mr. Aquino’s watch, the Philippines has agreed to opening up several of its military facilities in American forces—a quarter-century after nationalist sentiments forced the closure of US bases in the island nation. AP

the Macau Gaming Information Association. Operators are looking abroad for destinations with stable governments and favorable tax structures and policies for gaming, Tong said at a gaming conference in Macau on Tuesday.

Imperial Pacific’s temporary casino on Saipan, which opened last November, has delivered better-than-expected revenue, according to Yan. A junket law has been approved on the island earlier this year, and he expects gaming promoters can bring more big gamblers to the tropical island.

Meanwhile, Melco International, the biggest shareholder of Macau-based casino operator Melco Crown Entertainment Ltd., is looking at Vietnam and other destinations for its expansion, Choy said. Melco Crown already operates a casino resort in the Philippines. Junket promoters, such as Suncity Group and Jimei International Entertainment Group Ltd., are now attracting Chinese high rollers to the gaming tables and crystal blue waters of Vietnam, Cambodia and other Southeast Asian gaming attractions. Bloomberg News