BusinessMirror October 30, 2015

BusinessMirror

THREETIME ROTARY CLUB OF MANILA JOURNALISM AWARDEE 2006, 2010, 2012

U.N. MEDIA AWARD 2008

A broader look at today’s business Thursday 201430, Vol. 10 No. 40Vol. 11 No. 22 Friday, 18, October 2015

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AUSTRALIA’S LARGEST TELCO PLAYER LOOKING AT $1B INITIAL INVESTMENT FOR ITS JOINT VENTURE WITH SAN MIGUEL

Telstra readies PHL war chest

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ELSTRA Corp. Ltd., the largest telecommunications player in Australia, is planning to invest as much as $1 billion in a Filipino wireless joint venture with San Miguel Corp., a significant amount that National Telecommunications Commission (NTC) Director Edgardo V. Cabarios said is already enough to finance the deployment of a national network and help the new player compete aggressively against incumbent providers.

INSIDE

‘WOMEN ROCK (?)

The spirit of truth

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EAR Lord, one practice we never fail to do when we write our prayers for all our readers is to call on the Holy Spirit for inspiration and guidance not only on the content of the prayers but the grace that every reader has when reading these prayers and that the Spirit guides us into all truth. John 16:13 says, “But when He comes, the spirit of truth, He will guide you to all truth.” Oh Holy Spirit, fill the hearts of thy faithful, enkindle in them the fire of Your love, send forth thy Spirit and they shall be created. Amen.

WHAT THE HOLY SPIRIT DOES, GEMMA AND LOUIE M. LACSON Word&Life Publications • teacherlouie1965@yahoo.com

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

Life

HALLOWEEN TIPS FOR DOG OWNERS »D2

BusinessMirror

Friday, October 30, 2015

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WOMEN ROCK (?)

BETTER

DAYS In the Ernst Lubitsch film version of Noel Coward’s Design for Living (1933), Miriam Hopkins brilliantly navigates an Americanized menage a trois.

The “pre-Code era” in Hollywood was full of splendid female protagonists existing all over the spectrum. Not so these days.

B M P Chicago Tribune

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ARLIER this month Jennifer Lawrence, Oscar winner for Silver Linings Playbook Playbook, let loose with an essay sparked by a financial revelation. At 25, she may be the highest-paid actress in Hollywood, earning (according to Forbes Forbes) a cool $52 million in the fiscal year ending June 2015. But Lawrence made considerably less than her male costars Christian Bale, Bradley Cooper and Jeremy Renner while working on director David O. Russell’s American Hustle.

Lawrence’s essay was a call to arms.

It was also a confession. Posted to Lena Dunham’s online forum Lenny Letter, it quickly became a national talking point—in part because The Hunger Games star and X-Men ensemble

player pointed the finger at herself, as well as others.

After seeing the salary numbers revealed by the leaked Sony documents, “I didn’t get mad at Sony,” Lawrence wrote. “I got mad at myself. I failed as a negotiator because I gave up early.... I didn’t want to seem ‘difficult’ or ‘spoiled.’

This could be a young-person thing.

It could be a personality thing. I’m sure it’s both. But this is an element of my personality that I’ve been working against for years, and based on the statistics, I don’t think I’m the only woman with this issue.”

Lawrence summed it up: “I’m over trying to find the ‘adorable’ way to state my opinion and still be likable.”

With that sentence, how many women and men around the world

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LIFE

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N. KOREANS DOING FORCED LABOR ABROAD –U.N. REPORT The World BusinessMirror

B2-2 Friday, October 30, 2015

JEB ATTACKS RIVAL MARCO

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OULDER, Colorado— Jeb Bush targeted Marco Rubio in a fight for control of the Republican Party’s establishment wing in the third Republican presidential debate, as insurgent outsiders Donald Trump and Ben Carson defended the seriousness of their White House bids.

Bush, the former Florida governor and son and brother of former presidents, was once seen as the top Republican contender.

But he entered on Wednesday night’s debate in the midst of the most difficult stretch of his White House campaign.

By attacking Rubio, a senator, for his spotty voting record on Capitol Hill, Bush signaled that he sees his fellow Floridian as the candidate most likely to block his political path.

“Marco, when you signed up for this, this was a six-year term and you should be showing up for work,” said Bush, who is struggling to right his campaign after being forced to slash spending in response to slower fund-raising.

Rubio, who has had a close relationship with Bush, responded sharply: “Someone has convinced you that attacking me is going to help you.”

Bush and Rubio clashed for control of the party’s more mainstream wing in the debate, which comes some three months before the fi rst votes are cast in the race, leaving much time for things to change.

Trump, a brash billionaire businessman, dominated in the polls for months, but Carson has recently taken the momentum and overtook Trump in polls in Iowa, where the first of the state-bystate contests will be held. Neither Trump nor Carson are career politicians but both have capitalized on anti-Washington, anti-establishment feeling among many conservatives.

Trump largely refrained from personal attacks on his rivals, which has been a signature of his campaign, even taking a light touch with Carson.

He bristled when asked by a debate moderator if his policy proposals, including building a wall along the US-Mexico border and deporting everyone who is in the US illegally, amounted to a “comic book” campaign.

“It’s not a very nicely asked question, the way you ask it,” Trump responded. Then he defended his proposals as reasonable.

Carson, a soft-spoken retired neurosurgeon, stuck to his lowkey style and sought to explain his vague tax policy, which he has compared to tithing, in which families donate the same portion of their income to their church regardless of how much they make.

Carson said in an earlier debate that someone making $10 billion would pay $1 billion in taxes.

On Wednesday night he floated the idea of a 15-percent flat rate.

Critics have questioned whether the government could still raise enough revenue under that type of flat tax system to pay for federal programs.

The Republican nominee will most likely face Hillary Rodham Clinton, former first lady and secretary of state. The overwhelming favorite for the Democratic nomination, her campaign received a boost from a strong debate performance two weeks ago.

Ohio Gov. John Kasich and New Jersey Gov. Chris Christie are each seeking to break through with more mainstream Republican voters. Kasich, in particular, was aggressive from the start in bemoaning the unexpected strength of unorthodox candidates.

Also on stage were former Arkansas Gov. Mike Huckabee, Kentucky Sen. Rand Paul and former technology executive Carly Fiorina, the star of the second Repub-

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N.Koreans doing forced labor abroad–UN report

NORTH Korean leader Kim Jong Un (right) waves with Chinese official Liu Yunshan during a military parade to mark the 70th anniversary of the North’s ruling party and trumpet Kim’s third-generation leadership in Pyongyang, North Korea, on October 10. The two men raised their clasped hands above their heads like a pair of victorious athletes, as international media and tens of thousands of North Koreans looked on.

The gesture during a high-profile celebration in Pyongyang seemed designed to scotch appearances that their countries have been drifting apart. AP/WONG MAYE-E

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NITED NATIONS—Tens of thousands of North Koreans are being sent to work abroad in conditions that amount to forced labor to circumvent UN sanctions and earn foreign currency for the country, amounting to between $1.2 billion and $2.3 billion annually by one estimate, a UN investigator said on Wednesday.

Marzuki Darusman, the special rapporteur on human rights in North Korea, said in a report to the UN General Assembly and at a news conference that the workers are providing a new source of money to a country facing a “really tight financial and economic situation.”

He accused the North Korean government of violating the International Covenant on Civil and Political Rights, which it has signed and which bans forced labor.

He said that companies hiring North Korean workers “become complicit in an unacceptable system of forced labor.”

Darusman said more than 50,000 North Korean workers are currently employed in foreign countries, mainly in the mining, logging, textile and construction industries, according to various studies—and he said the number is rising.

The vast majority are working in China and Russia, he said, but they are reportedly also employed elsewhere in Asia, Africa, the Mideast and Europe. He listed Algeria, Angola, Cambodia, Equatorial Guinea, Ethiopia, Kuwait, Libya, Malaysia, Mongolia, Myanmar, Nigeria, Oman, Poland, Qatar and the United Arab Emirates.

Darusman said civil-society organizations report that workers from the reclusive Asian nation earn $120 to $150 per month on average, don’t get enough food, and are sometimes forced to work up to 20 hours a day, with only one or two rest days a month and insufficient food.

Employers pay “significantly higher amounts” to the North Korean government, he said.

Former workers interviewed by the organizations said jobs are assigned according to the worker’s state-assigned social class with those in lower classes assigned the most dangerous and tedious tasks, he said.

The ex-workers also reported being under constant surveillance by North Koreans in charge of ensuring that they comply with government rules and regulations, he said.

Darusman praised a construction company in Qatar for dismissing 90 North Korean workers in May— nearly half its work force—for alleged repeated violations of domestic labor legislation. According to the company, which was not named, supervisors were forcing them to work more than 12 hours a day, he said.

Darusman cited a report by the International Network for the Human Rights of North Korean Overseas Labor in 2012 that North Korea is believed to earn between $1.2 billion and $2.3 billion

annually from these workers.

The UN investigator put the spotlight on forced labor as a humanrights violation in his report that also cited summary executions, arbitrary detention, torture, massive illtreatment of individuals in political prison camps and severe discrimination based on social class.

“The near total denial of human rights in the country revolves around...instilling fear within the minds and hearts of the population,” Darusman said.

He said he “remains convinced” that the Security Council should refer North Korea’s human-rights situation to the International Criminal Court, to speedily bring to justice those most responsible the denial of human rights, “including those at the highest level of decision-making.” Such a move, however, is likely to be vetoed by permanent council member China and perhaps Russia.

Pyongyang has tried to cultivate both over the years as rare allies.

Darusman said he has met with Chinese diplomats in Geneva and New York and had good discussions on how to get North Korea to engage more with the international community. In these discussions, he said, “it did come out that their relations with North Korea are quite strained in recent times.”

He added that he has been encouraged to visit China. AP

Prince Harry gives royal push for Invictus Games for troops

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ASHINGTON—Britain’s Prince Harry made an Oval Office confession to President Barack Obama on Wednesday.

The prince, in town to promote the Invictus Games for wounded service members, told Obama that he’d had “huge amounts of fun” stealing the idea for the international competition from the US-based Warrior Games and then “making it better and now we’re giving it back to you.”

Obama made clear he didn’t mind.

The president called the international sports event—scheduled for May in Orlando, Florida—a way to make sure people see not only the sacrifices of wounded warriors “but also the incredible contributions, strength and courage that they continue to display.”

Harry spearheaded the first games, in

BRITAIN’S Prince Harry, first lady Michelle Obama and Jill Biden tour the USO Warrior and Family Center at the Fort Belvoir military base, on Wednesday at Fort Belvoir, Virginia. The event is being held in support of the Invictus Games Orlando 2016. AP/ANDREW HARNIK During his visit to the base, the prince, accompanied by first lady Michelle Obama and Jill Biden, high-fived two rows of

recalled seeing the brutal injuries suffered by fellow service members, and said that’s when he found his mission—to help in-

one former service member and tapped his toes to the jazzy strains coming from a drums-and-keyboard duo of Marines as he joked, “If I played an instrument, I’d join the band.”

Singer and keyboard player Lt. Col. Shane Tomko of Quincy, Illinois, credited the music therapy program with helping save his life.

Harry, Mrs. Obama and Biden sat courtside to check out a wheelchair basketball game, the three of them clapping and cheering for both teams. The trio and the crowd applauded as a female player who toppled out of her wheelchair was helped up by other players.

Mrs. Obama, who warmed up the crowd for Harry, took note of the excitement attached to the prince’s visit, telling the crowd, “Alright ladies, Prince Harry is here. Don’t act like you don’t know.”

JAPAN SEES SURPRISE OUTPUT GAIN

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APAN’S industrial production unexpectedly increased in September, potentially raising the bar for an expansion in Bank of Japan (BOJ) stimulus at Friday’s policy meeting.

Output climbed 1 percent from the previous month, exceeding all 32 estimates in a Bloomberg survey, which had a median forecast for a decline of 0.6 percent. Electronic parts, devices and chemicals led the advance last month, in the face of a Chinese slowdown that has undermined Japanese exports.

The output report was viewed as a crucial data point by BOJ officials as they prepared to consider whether to step up what’s already an unprecedented assetbuying program, people with knowledge of the discussions said last week.

Yen trading reflected some reduction in expectations for action from the BOJ, with the currency up 0.2 percent following the release.

“The positive production data requires no change for the BOJ’s optimistic view for the economy,” said Kazuhiko Ogata, an economist at Credit Agricole SA. He forecast a 0.5-percent increase in output, which was the highest estimate in the Bloomberg survey. “Still, this doesn’t change the fact that uncertainties are still high for the outlook of Japan’s economy and the BOJ is far from 2-percent inflation target. Additional easing remains a question of when, not if.”

Production slid 0.9 percent from a year earlier. Companies forecast it would jump 4.1 percent in October from September, before dropping back 0.3 percent in November.

The yen strengthened after release of the data. It traded at 120.80 per dollar at 9:13 a.m. in Tokyo. The Topix index of stocks opened up 0.5-percent after the US Federal Reserve said global risks had diminished and signaled confidence in the US economy, paving the way for a potential interest-rate increase in December.

Economists remain split on whether the BOJ will boost monetary stimulus at its meeting on Friday. While 16 of 36 analysts surveyed by Bloomberg said they expect Kuroda and his board to bolster monetary policy, eight forecast further easing at a later date and 12 see no prospect of change in the foreseeable future.

Data on hiring, spending and inflation also are set to be released on Friday.

A government report on Wednesday showed that retail sales gained 0.7 percent in September from August, missing a 1.1-percent increase estimated by economists surveyed by Bloomberg.

Analysts lowered their projections for Japan’s growth after a government report last month showed that production unexpectedly fell in August. Also, gross domestic product shrank in the second quarter, and is forecast to rebound just 0.6 percent in the third quarter, according to a Bloomberg News survey conducted from October 2 to 7.

The forecast, which includes some predictions of a contraction in the third quarter, was lower than the September survey of 1.2-percent growth. Bloomberg News

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MANILA HOSTS APRCE Trade Secretary Gregory L. Domingo (second from left) and President Aquino converse while the Chief Executive waits for his turn to deliver his address at the opening ceremonies of the Manila hosting of the Asia Pacific Retailers Conference and Exhibition (APRCE) at the SMX Convention Center. The Philippines waited for two decades to host anew the biggest retail-industry event in the region, attended by thousands of delegates from the member-countries of the Federation of Asia-Pacific Retailers Associated, chaired by Mehmet Nane (left). The Philippine Retail Association, headed by Lorenzo Formoso (fourth from left), adopted the theme “Asia Fast Forward” for the 17th edition of the APRCE to highlight the region’s growing strength as an economic community. NONIE REYES

Meralco to expand power portfolio

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But with Telstra expected to own as much as 40 percent of the soon-to-be launched telco—and the majority share to be held by San Miguel—the new player’s war chest could easily reach $2.5 billion.

In a disclosure to the Australian bourse, Telstra Chief Finance Officer Warwick Bray said his company has set a $1.5-billion capital for mergers and acquisitions for the remainder of 2015, and bulk of which will reach Philippine soil as early as this quarter.

“Turning to organic investments. These include investments in our capital program and start-up investment, such as the investment in the Philippines, were we to purse that opportunity,” he said. “Our criteria for organic investments are a net present value that is positive, using a weighted average cost of capital plus an appropriate risk margin.”

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NEPAL TURNS TO CHINA FOR FUEL AFTER INDIA RESTRICTS SUPPLY ATHMANDU, Nepal—Fuel-starved Nepal has signed an agreement with China to provide gasoline, diesel and cooking gas, after India restricted its supplies as a result of ongoing political protests in the Himalayan nation, officials said on Thursday.

A memorandum of understanding was signed with China National United Oil Corp. in Beijing, said Nepal Oil Corp. official Deepak Baral. Details on how much fuel would be sent to Nepal, prices and other arrangements still need to be worked out, he said.

It would be the first time Nepal would be getting fuel from China, effectively ending India’s monopoly on the fuel supply.

India has restricted fuel supplies since Madhesi ethnic groups in southern Nepal, with whom it has close cultural ties, began protesting Nepal’s new constitution, seeking more rights.

Protesters have blocked a key Nepal-India border point for weeks. Other crossings are free of protesters, but India has refused

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N line with the government’s goal to diversify the energy mix and strike the right balance between renewable and traditional sources of energy, the power-generation business of the Manila Electric Co. (Meralco) is “currently looking” at investing into various forms of renewable energy (RE).

Renewable sources of power include solar, wind, biomass, ocean, geothermal and run-of-river hydro.

“We are currently looking at other projects, which include re-

PESO EXCHANGE RATES n US 46.7710

newable like run-of-river, other hydro projects and, potentially, gas. I think, eventually, this will be part of our portfolio. These are the things that we are looking at because we do not want to be a one-fuel generator. We would like to spread the risks and invest in different types of plants,” Meralco President Oscar S. Reyes said.

Meralco is engaged in power distribution. It is the country’s largest electric distribution utility firm with 5.6 million customers nationwide.

Meralco PowerGen Corp. (MGen) is the utility firm’s power-genera-

tion arm. Together with partners, MGen has three power projects in the pipeline: the 455-megawatt (MW) coal-power plant in Mauban, Quezon, under San Buenaventura Power Ltd. (SBPL), a joint venture between MGen and Thailand’s New Growth B.V.; the 600-MW coal plant in Subic, Zambales, under Redondo Peninsula Energy Inc. (RP Energy), a joint venture among MGen, Aboitiz Power Corp. and Taiwan Cogeneration Corp.; and the 1,200MW Atimonan plant in Quezon.

All of MGen’s power projects are

PHL TO CALENDAR FTA TALKS WITH MEXICO, CANADA, CHILE

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HE Philippines will be taking steps to secure bilateral freetrade agreements (FTAs) with three countries on the sidelines of the Asia-Pacific Economic Cooperation (Apec) meeting next month, Trade Secretary Gregory L. Domingo said.

In a forum earlier this week, the trade chief expressed hope that the Philippines will get to engage Chile, Mexico and Canada in bilateral talks, at the Manila hosting of the Apec, to possibly build on ear-

lier FTA discussions.

For Chile, FTA negotiations are still on the infancy stage. Manila and Santiago are planning to conduct a joint study to assess whether pursuing a bilateral FTA would be mutually beneficial.

A joint economic cooperation (JEC), meanwhile, is being eyed by the Philippines with Mexico. The two countries are slated to have a discussion on this on November 16.

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n JAPAN 0.3867 n UK 71.4146 n HK 6.0350 n CHINA 7.3548 n SINGAPORE 33.3483 n AUSTRALIA 33.3673 n EU 51.1160 n SAUDI ARABIA 12.4763

Source: BSP (29 October 2015)

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Friday, October 30, 2015

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PHL property sector seen to withstand China gloom Continued from A8

indications of surpluses in certain locations and categories, but that a substantial backlog exists in the low-cost housing portion of the industry.

Pinnacle previously said the National Economic and Development Authority estimated the housing demand at more than 800,000 units a year, of which close to 400,000 is met. The remaining households represent demand from informal-settler families who cannot afford one.

Private real-estate developers typically target to carve a market share from the 400,000 annual demand for housing in the Philippines.

“The problem with low-cost housing is that it’s very dependent on long-term mortgages, which are provided by the government. So depending on how efficient the take-out system of the government, that drives the volume of production and sales,” he said.

Since the private sector cannot fund the

low-income portion because the interest rates are socialized, ranging from 5 percent to 7 percent, the developers themselves do not participate.

Given this, Mangosing urged the government, through its housing agencies, to become efficient in terms of raising funds for socialized low-cost housing.

“The potential demand is there, but it’s the funding that is lacking,” he said.

It was noted the Housing and Urban Development Coordinating Council approved

in June the adjustment of the so-called economic-housing loan ceiling to P1.7 million from P1.25 million.

This will give average-income earners living in highly urbanized cities a chance to avail of a higher value loan for housing.

Looking forward, Mangosing expects the growth areas of the local property market to come from the hospitality, retail and commercial-development sectors.

On the various developments now taking place overseas, Ensign Media CEO and

Property Report Magazine Publisher Terry Blackburn said the Philippines is resilient enough as to be sufficiently shielded from China’s economic slowdown.

“In fact, during our Property Report Congress last week, we asked all of the speakers about this, and 90 percent said what’s happening in China now will have no impact on the property market here and in the region,” he said. “Unless there’s a major hiccup from outside of the country, I expect the industry to move forward,” Mangosing quickly added.

Meralco to expand power portfolio ‘Print industry is alive with emergence Continued from A1

to be sourced from coal. “The Philippine electricitiy market is competitive. To be able to sell, it has to be cheap. Coal is the cheapest,” MGen Senior Vice President Angelito Lantin said.

For the three projects, which are targeted for completion in 2019 until 2020, the company’s equity investment is about $1.2 billion, according to Meralco Chief Financial Officer Betty Sy-Yap. The amount, she added, excludes the debt component of the projects’ total costs. Meralco, through MGen, targets to provide 3,000 MW of power in Luzon.

MGen also has interest in Global Business Power Corp. (GBPC), one of the largest independent power producers in the country and a member of the GT Capital group of taipan George Ty. The liquefied natural gas (LNG) project could cost at least $2 billion. Meralco was initially planning a LNG project in Atimonan, but later decided on a coal-power facility. “We’ve considered gas before for Atimonan and we continue to look at gas,” Reyes said.

The company is in talks with Osaka Gas of Japan for a potential 1,500-MW LNG project. Meralco Chairman Manuel V. Pangilinan said his group will establish a new unit that would solely focus on RE. “Pretty soon. I will say toward the end of the year,” Pangilinan said when asked when the RE unit would be created. “We will announce it. We are playing with some names.”

The new business unit will be incorporated “very soon,” he said earlier, adding that the group is eyeing to hire a chief operating officer “from outside” of Meralco.

Solar power is on top of Meralco’s plan to venture into RE business.

“We are looking at solar, not just utility-grade solar, but we will start probably with rooftops. So, for that

business, we need to have a separate subsidiary and separate management,” Pangilinan said.

In preparation for this, Meralco will construct a research and development and technical training facility that will be called Meralco Power Tech, a two-story structure that will be powered by solar and wind.

The facility, which will feature a Smart Grid, is worth P150 million.

Aside from solar panels, Pangilinan said his group is also eyeing venturing into battery storage. “Eventually, that will be part because you have to store the power.

We will just install the solar panels first,” he said.

The recent launch of Powerwall by Tesla, an American company known for making electric vehicles, prompted Meralco to look into battery storage.

“We were quite concerned about the Tesla announcement recently. The ability of solar panels to be stored in batteries could disrupt the traditional business model of Meralco.

Powerwall is a cost effective battery that stores electricity on a massive scale. Experts said these storage batteries are expected to solve a problem that the power industry has so far failed at.

Pangilinan is mindful of the technological development capable of disrupting Meralco’s business model.

“I think the fact that Meralco will enter the solar market signifies that we will disrupt. We think it as a future threat. So, we will be the first to disrupt ourselves because if we don’t do it, others will do it. So, rather than have somebody kill us, we might as well ‘kill’ ourselves because that will be more fun,” he said.

Nonetheless, Pangilinan said these developments will translate to shifts in the energy mix with the growing penetration of renewables potentially at grid parity. “They will also lead to new ways of defining the quality of services, and of creating value for the customer, enabled by a smart or smarter grid,” Pangilinan said.

of millennials’… prevail over the next two decades.

Born from 1980 onward, the members of the so-called Generation Y are generally characterized by their enthusiasm for technological and communication advances, according to Alegre, who is also the president of United Print Media Group (UPMG). “[They] blazed paths in a new world of information-sharing using socialnetworking technologies,” he said.

Considering that they account for 36 percent of the country’s population of 98.39 million, he said the millennials are a lucrative market for printmedia players given that the group has the “power to decide, criticize or say what they want.”

Alegre cited a study conducted by Omnicon Media Group three years ago, highlighting their economic independence that contrasted sharply against counterparts in the region.

The report ranked Filipino millennials the highest among 32 markets in terms of expectations of doing good, or more likely to shop at stores, or buy products or services from companies that make charitable donations.

Also, they ranked the highest (68 percent) among respondents who consider themselves as savers rather than spenders, and who have interest in

Continued from a8

planning for their future financially.

Millennials in the Philippines (59 percent) topped those in Singapore (58 percent) for agreeing that product reviews are important in their buying decisions.

Among eight Asian countries, Filipino Gen Yers form the biggest number of respondents (78 percent) who share deals with their friends, not open to follow brands outside of their favorite brands list.

According to the latest Nielsen Global Survey of Consumer Confidence, millennials outpace the global average in terms of spending intentions in the first quarter of 2015.

Two beliefs have surfaced from the millennials in the Philippines: They have something to contribute to society and they need to have space to share their stories.

Alegre said print media are a fitting channel to do so given its wide reach and influence.

He encouraged publications to come up with dedicated sections and stories that appeal to their interest as well as host events that attract them, as well.

“That’s why we need millennial writers for the Millennial section. You cannot have somebody professing to be a millennial to write in their stead.

They have to be able to know terminologies; their wants and desires

cannot be invented. It has to be born out of being a millennial,” he said.

“I think there should also be more events for millennials. The venue should not be the venue where politicians would go to, but a venue the millennials would like to go to. So you have to have a good venue with music, lights, food and alcohol.

“Maybe we can have a job fair that is strictly for millennials. Probably, we can have a night run or a night event that is strictly for millennials. We can also invite known brands to come and present it to the millennials.”

With the various print players as the BusinessMirror’s Millennials section, the Philippine Star’s breakthrough television mini-series, Single/Single; and the Philippine Daily Inquirer’s Youngblood column actively seeking their audience, Alegre said this is a “very clear indication that all of us leading print media corporations recognize that we are all [exerting an] effort to try and make sure we are relating to them, [that] we are communicating to them.”

W hen asked how the print industry should continue to remain relevant in the digital age, Alegre said the industry needs to understand the market and creatively cater to their needs. Roderick Abad

Li floats new five-year growth goal at minimum of around 6.5 percent Continued from A8

exports. Recent depreciation in the currency has been a “market action,” he said, according to the account. The program to bolster international use of the yuan will continue to advance, he added.

The premier said that fiscal and financial risks are increasing, and that the stock-market rout suffered earlier this year was caused by leverage, such as a surge in margin financing. Growth cannot return to the days in excess of 10 percent, though it can stay in a reasonable range, Li said.

Officials have worked hard to achieve the current target of 7 percent, the premier said. Some private estimates of the economy indicate that the expansion may be weaker than officially reported, as gains among new services and consumer- led businesses aren’t yet sufficient to offset a contraction among old-line industries.

“In the next five years if China can grow between 6 percent and 6.5 percent,then that will be a very good number,” said Liu Li-Gang, the chief Greater China economist at Australia & New Zealand Banking Group Ltd. in Hong Kong. China’s goal of a “moderately prosperous society” refers to policy-makers’ plan to double per-capita income by 2020 from 2010 levels. Li said that the country will lift most of the people currently among the 70 million living in poverty out of that condition by 2020. Bloomberg News

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Lawmakers call for total revamp at intl airport

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AWMAKERS on Thursday called for a top-to-bottom revamp at the Ninoy Aquino International Airport (Naia) following discovery of a scheme meant to blackmail passengers for money.

Chairman of the House Committee on Labor and Liberal Party Rep. Karlo Alexei Nograles and Nationalist People’s Coalition Rep. Sherwin Gatchalian of Valenzuela said that unlike in most countries where their airports are a source of their national pride, Naia has become a source of disgrace and national embarrassment.

“The credibility of the Aquino government’s success in the fight against corruption is being diminished by the Naia’s notoriety not only because of its dilapidated facilities, but also because of its rogue personnel,” Nograles said.

The latest victims of the scheme called “laglag bala” include a 56-year-old overseas Filipino worker named Gloria Ortinez and a 33-year-old Japanese national Kazunobu Sakamoto who were arrested, detained and charged for allegedly carrying bullets in their luggages.

Ortinez claimed an Office for Transportation Security (OTS) personnel planted a bullet in her hand luggage as it went through an x-ray machine

at the Naia Terminal 2 departure area. She was prevented from leaving the country on Sunday and has been detained.

Ortinez’s lawyer asked why authorities of airports where Ortinez came from before going to Terminal 2 did not confiscate the bullet. “Do they have different security procedures in airport terminals?,” her lawyer said.

The other alleged victim, Sakamato, was arrested by the Philippine National Police-Aviation Security Group after the OTS found two bullets in the right side pocket of his baggage.

Both Ortinez and Sakamato have been charged with illegal possession of live ammunition and have been released from detention after posting bail.

On his part, Gatchalian also asked the government to implement a top-to-bottom revamp at the airport.

Gatchalian earlier filed House Resolution 2419 which directs the committees on good government and on transportation to conduct an inquiry, in aid of legislation, into the series of laglag-bala incidents in Naia. “ T his is a l ready becoming an international embarrassment,” said Gatchalian, a senior vice chairman of the House committee on tourism.

Jovee Marie N. dela Cruz

Govt, groups gear up as Pinoys travel to remember the dead

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EVERAL government units and groups announced on Thursday preparations, as thousands are expected to troop to cemeteries and churches in remembrance of dead kin.

To note, traffic at the expressways operated by Metro Pacific Investments Corp. are expected to rise by as much as 15 percent during the holidays, with congestion expected to build up in the afternoon of October 30 until late morning of November 1 going north.

Vehicles entering the North Luzon Expressway (Nlex) is expected to rise to as much as 218,500 per day during the holidays, while that of Subic Clark Tarlac Expressway (Sctex), 40,250 daily entries.

For vehicles traveling back to Manila, heavy traffic is expected to start in the early evening till midnight of Saturday. The next wave of increased traffic volume southbound is expected in the afternoon of Sunday until the morning of Monday.

The Nlex will open spare lanes and additional layers of manual toll collection during peak hours at the Mindanao, Dau and Bocaue toll plazas, according to Francisco Dagohoy, Tollways Management Corp. communication specialist. For Sctex, advance toll collection will be conducted at Mabalacat on October 30 and 31.

Fishbone lanes will open at Mabalacat southbound on Sunday. Spare lanes will also be opened at the Bocaue Barrier to accommodate the surge of vehicles going back to Metro Manila, Dagohoy added.

The Manila North Tollways Corp.

(MNTC) said it would also use portable toll-collection system gadgets in these locations.

The Nlex and SCTEx concessionaires of the MNTC also announced all roadworks would be suspended beginning October 29 until November 2. There will be no mainline roadwork lane closures during this period unless safety repair is required, Dagohoy said. See related story on B6.

Red Cross, police

The Philippine Red Cross (PRC) said the group will mobilize first-aid stations in cemeteries and memorial parks, and in major highways, bus terminals, and airports and seaports

for the observance of All Saints’ Day. The PRC said these units will be present in 277 cemeteries in the country, 11 seaports and airports, and 12 bus terminals. There will be a total of 310 first-aid stations, 72 ambulances on standby and 1,810 first-aid personnel.

The PRC said personnel will be present in 11 gasoline stations in major highways. It added it would also have five standby rescue teams with 30 personnel, 66 welfare stations, three beach-patrol stations in La Union, six rescue vehicles, five Humvees and one 6x6 truck on standby in case of mass casualty incidents.

On the other hand, a total of 2,000 policemen were deployed in Central Luzon starting on Wednesday, according to Chief Supt. Rudy Lacadin, Police Regional Office-3 (PRO3) acting regional director. Senior Supt.

Roque Eduardo Vega, regional director of the Highway Patrol Unit (HPU) 3, said he has ordered all his chiefs from the provincial highway field to prepare for the influx of motorists that will be going to different provinces in Northern Luzon.

But while the Nlex and Sctex are expected to experience a surge in traffic, Manila-Cavite Toll Expressway will likely experience low traffic volume on November 1.

Within the metropolis

ON Thursday the Metropolitan Manila Development Authority (MMDA) advised motorists to avoid some portions of Edsa and other areas, as the Department of Public Works and Highways (DPWH) will undertake road reblocking and repairs starting 10 p.m. of October 29 until November 2.

For southbound, the reblocking and repair works will be conducted along Edsa, from Estrella Street to Sen. Gil Puyat Avenue, and along Edsa between Scout Borromeo and Timog Avenue (Service Road or the first lane) from sidewalk.

The MMDA said reblocking northbound would be along C-5 Road between SM Warehouse to FR Cement going to Lanuza Street, innermost lane, and along Edsa between Aurora Boulevard and K-10 Street, first lane from sidewalk. Claudeth Mocon-Ciriaco, Ashley Manabat and Lorenz S. Marasigan

Editor: Dionisio L. Pelayo • Friday, October 30, 2015 A3

Compatriots want to stop deportation of Korean businessman with expired visa

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HE Korean community has appealed to Justice Secretary Benjamin Caguiao to stop the impending deportation of prominent South Korean businessman whom they claimed was framed up for a misdemeanor case.

Korean diplomats and religious leaders of the Saint Kim Dae Gun Catholic Church and the United Korean Community Association in the Philippines came together at a news briefing to appeal the case of Kang Tae Sik who was arrested last week by Bureau of Immigration (BI) agents.

Kang is the president of K&L Jinro Philippines Inc. and listed as among the top 1,500 tax payers of Makati City, according to his lawyer Redentor Viaje.

Viaje noted that his client is not facing any criminal charge nor a fugitive from law, which would warrant his immediate deportation.

“This unscrupulous issuance of warrant of deportation is not novel as there was already precedents wherein immigration officials were ordered dismissed and penalize,” Viaje said.

On Wednesday last week members of Intelligence Division of BID swooped down on Kang’s Makati

office and apprehended him on the strength of Warrant of Deportation signed by Immigration Commissioner Siegfred Mison.

Viaje pointed out that the Warrant of Deportation was apparently issued on a request of an unnamed person which letter is attached with the warrant.

He insisted that the BID cannot legally issue a warrant of deportation unless a deportation case is final and executory.

Viaje said the issuance of Warrant of Deportation against his client is premature since the deportation case still awaits resolution before the Department of Justice (DOJ).

Kang’s case was remanded to the DOJ after the BI’s board of commissioners reaffirmed his deportation case on September 16.

Korean Ambassador Hyuk Lee had appealed Kang’s case to former justice chief Leila de Lima, who or-

dered a review of the businessman who has invested in the country for 32 years and listed one of Makati City’s top taxpayers.

Viaje assailed Kang’s arrest and detention by the BI as illegal and coercive amid the pendency of his deportation case before the DOJ. Viaje noted that according to the law and Supreme Court decisions, an alien still has the right to appeal his case before the DOJ secretary up to the Office of President or the Court of Appeals.

Kang was ordered deported on June 26, 2015, based on complaint by his former counsel, Alex Tan. Kang was charged of alleged violation of Section 37 (a) Court of Appeals 613 (immigration law) after Tan informed the BID that Kang was convicted of Violation of Batas Pambansa 22, some 20 years ago, and meted 10-month imprisonment.

Kang claimed he was framed up through a forged signature.

In his affidavit Kang informed Mison that the law firm, headed by Tan, has been his consultant and business adviser of his export-import company, a Korean food and beverage, based in Parañaque City, for the past 10 years.

As legal counsel of his company, Kang claimed that the law firm reportedly obtained several documents and sensitive materials during their engagement to eliminate the Korean in his line of business.

Viaje said the BID resolution was appealed to the DOJ, arguing that Kang’s conviction for violation of BP 22 cannot be the basis for his deportation considering the law requires that the penalty must be one year and above.

Moreover, the Supreme Court has recently deleted the penalty of imprisonment for violation of BP 22.

In 2007 Regional Trial Court (RTC) in Manila Branch 13, issued an order considering the penalty against Kang to have prescribed and ordered the lifting of his hold departure order.

Because of the said argument de Lima ordered the case remanded to the BID for reevaluation of the said arguments.

However, on May 21, the BI issued a resolution, ordering anew the deportation of Kang based on a new charge, for allegedly being “undesirable alien.”

In his motion for reconsideration, Viaje reiterated that the order of deportation based on a new charge is a gross violation of his client’s right to due process.

“How can Kang can be considered as undesirable alien when his corporation is among the top 1,500 taxpayers in Makati City,” Viaje said.

The motion for reconsideration was again denied by BID on September 15 and is now pending anew at the DOJ. Joel R. San Juan

‘Re-Christianize’ Halloween, Catholic officials urge Pinoys

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INDIGENOUS VOICE Students and indigenous peoples, collectively known as lumads, display placards following their march around

the University of the Philippines campus to denounce the recent killings of their leaders in southern Philippines on October 28 in suburban Quezon City. The “Lumads,” who traveled to Manila by land and sea, are demanding the pullout of government forces, as well as the disbanding of paramilitary groups from their ancestral lands in the south. AP

Abad bares PHL good governance successes

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UDGET Secretary Florencio B. Abad said the Philippines has presented new commitments from 2015 to 2017 for achieving transparency and good governance before 160 member-states of the Open Government Partnership (OGP) at the conclusion of a meeting in Mexico City.

He said the OGP National Action Plan is not only 12 commitments from the national government, but also from the civil society and the private sector.

“We drafted our new commitments to the OGP to especially help us work closely with civil-society organizations and the private sector,” Abad said.

He added that these new commitments stress the importance of citizen participation in good governance, as well as ensure sustainable development for succeeding administrations.

At the three-day meeting in Mexico City, Abad said the Philippines was commended for its outstanding efforts to deepen citizen engagement in the budget process.

The budget agency launched the OGP in 2011 to provide an international platform for domestic reformers committed to making their governments more open, accountable and responsive to citizens.

Since then, the OGP has grown from its eight founding countries—including the Philippines—to 66 participating countries. In all of these countries, government and civil society are working together to develop and implement ambitious open government reforms.

Among the OGP commitments lined up by the Department of Budget and Management include proactive release of government data in open formats.

The goals also include publication of 6,000 datafiles in the Open Data Portal by 2017.

He said the government also committed to release new Citizen Participatory Audit Reports published and uploaded on the web site of the Commission on Audit by 2017. Estrella Torres

FFICIALS of the Catholic Bishops’ Conference of the Philippines (CBCP) on Thursday encouraged the faithful to introduce the “March of Saints,” instead of “Trick or Treat,” to children.

CBCP-Episcopal Commission on Social Communications and Mass Media Chairman Bishop Mylo Hubert Vergara echoed the call of Lipa Archbishop Ramon C. Arguelles who called on priests, religious, Catholic school heads and parish leaders in his archdiocese to start “re-Christianizing” Halloween through activities that give special attention to the lives of the saints.

“Alam po natin yung tinatawag natin na ‘trick o treat’ I Halooween at pinaparada natin ’yung mga nakamaskara, ’yung mga multo, mga hitsurang nakakatakot. Hamon na nga ng Simbahan sana ang iparada natin ay mga santo at santa,” Vergara said.

Internet literature notes that Halloween, which means “hallowed”–or holy–evening, is of Christian origin dating back to 1745.

For his part, Arguelles, in a circular issued on October 12, stated that parishes should introduce in our parishes and our communities the correct commemoration of the saints and the holy souls during our November celebration of the Church’s triumphs and sufferings.”

According to Arguelles, November 1 and 2 “are traditionally important dates in the Church calendar during which Catholics worldwide take time to pray for the souls of the departed and to commemorate the Communion of Saints.”

In the same letter, the archbishop expresses concern that the originally wholesome observance of Halloween (“All Hallow’s Even”), the evening immediately preceding All Saints’ Day, appears to have lost its religious character due to various outside influences.

“Unfortunately, secular, consumerist and pagan practices have also seeped into what is sacred and spiritual in our religious observances,” he notes, referring to American-style Halloween that emphasizes the macabre and seems to border on the demonic.

In line with this, Arguelles appeals to all ordained and unordained ministers of the Lipa See to join him in recapturing the true meaning of the liturgical event.

“May I endorse the proposal of the Prayer Warriors of the Holy Souls to make the Halloween celebrations more focused on the proclamation of saintly life stories,” the prelate added. Claudeth Mocon-Ciriaco

Economy

A4 Friday, October 30, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

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‘Congress can still force P-Noy to OK tax-rate cuts’

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he House minority bloc on Thursday asked Congress leadership to hasten the passage of the proposal lowering the income-tax rates to pressure President Aquino into enacting the measure.

Senior Deputy Minority Leader and Party-list Rep. Silvestre Bello III of 1-BAP and Independent Minority Bloc Leader and Lakas Rep. Martin Romualdez of Leyte said the lower chamber’s leadership should fight for the passage of the income tax-reform bill for the benefit of the Filipino workers. “[Chairman of the House Committee on Ways and Means] Miro [Quimbo of Marikina] should pass it first at the committee level and the House and Senate leadership [on final reading] and after that let P-Noy [President Aquino] face his bosses,” Bello said.

Romualdez also urged his fellow lawmakers to pass the measure, as this will pressure the Palace to change its position against the proposal to cut income-tax rates.

“We would definitely want this measure to get passed as this stands to benefit millions of Filipino workers,” Romualdez, a lawyer, said.

Malacañang, taking the cue from Department of Finance and the Bureau of Internal Revenue, has repeatedly rejected the passage in Congress of a long-pending bill mandating adjustments in individual and corporate income-tax rates, saying the government “cannot put our fiscal sustainability and credit rating at risk by doing piecemeal revenue-reducing legislation.”

Under the lower chamber's version of the bill, individuals earning below P180,000 annually will be exempted from paying income tax.

In the current setup, those earning P10,000 or less per month pay

5-percent income tax.

The bill also reduces the income-tax rate of those earning above P180,000 to 5 percent. The highest rate at 30 percent will be paid by those earning P1.1 million annually, he said.

Currently, those with yearly earnings of P500,000 and above pay 32-percent income tax.

Adjustment to inflation

Earlier, Speaker Feliciano Belmonte Jr. has said the leadership of the 16th Congress will convince President Aquino to at least let Congress adjust the levels of taxable income to inflation after the Palace rejected anew the proposal lowering income-tax rates.

“We [Senate President Franklin Drilon and I] will still convince

President Aquino [at least] on the proposal adjusting levels of taxable income to inflation,” he said.

Moreover, according to Quimbo only the proposal adjusting the income-tax bracket is viable, considering the position of the Palace on the proposal cutting the income tax rates and the remaining session days of the 16th Congress.

Quimbo said the P500,000 salary, for instance, which is currently taxable by 32 percent, needs to be adjusted, as this amounts to P1.2 million today.

The Department of Finance has said adjusting the levels of taxable income to inflation may cause the government to lose revenues totaling as much as 1.5 percent of the country’s GDP, or P30 billion. Jovee Marie N. dela Cruz

ERC delays release of new guidelines on power deals

By Lenie Lectura

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EGULATORS failed to release on Tuesday the much-awaited implementing guidelines (IG) for the Competitive Selection Process (CSP), a policy that mandates all distribution utilities (DUs) and electric cooperatives (ECs) to bid out their power requirements instead of entering into bilateral contracts.

Energy Regulatory Commission (ERC) Chairman Jose Vicente Salazar on Thursday said the agency had to “defer any announcement” because the Department of Energy (DOE)—the agency that crafted the controversial policy—asked for a meeting with the commission prior to the release of the IG. “Cognizant of the mandate of the DOE to formulate policies to ensure the security of supply of electricity, as well as the ERC’s authority to act as an independent regulatory body in the electric-power industry, and upon consultation with the members of the commission, we will defer any announcement on the CSP as we prepare for the meeting requested by the DOE secretary,” Salazar said in a text message.

The meeting is scheduled on November 4. Energy Secretary Zenaida Monsada is currently in Vienna and will be back next week.

“The DOE secretary requested for a meeting with us before any announcement is made by both agencies. As a courtesy to the DOE, the members of the commission agreed to the said request,” Salazar added.

The ERC chief could not say if the IG would be issued right after the meeting. However, Salazar assured that there would be “an appropriate announcement on the matter will be made after the said meeting is held.”

PROPERTY AWARDS

The Philippines Property Awards 2016 is now accepting nominees, with Paul Ashburn (from left), comanaging partner of BDO International; Terry Blackburn, CEO of Ensign Media; Marie Grace Ofaman, consultant from Hansgrohe; and Luis Enrique Mangosing, chairman of JCV & Associates and one of the judges for the 2016 Philippine Property Awards, informing members of the media that real-estate developers need to be nominated by third-party groups by November 29 to be considered. Stephanie Tumampos

Ombudsman dismisses cases vs Marina officials

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he Office of the Ombudsman has dismissed the criminal and administrative complaints filed by the president of the United Filipino Seafarers against officials of the Maritime Industry Authority (Marina).

In a 14-page Joint Resolution signed by Justice Conchita CarpioMorales on October 1, the Ombudsman found the allegations of Nelson Ramirez as baseless.

The complaints, filed on May 16, 2014, alleged violations of Section 3(e) and (g), Republic Act (RA) 3019, as amended (The Antigraft and Corrupt Practices Act) and RAs 9184 (Government Procurement Reform Act) and 9845 (Anti-Red Tape Act of 2007), for the first case; and Dishonesty, Grave Abuse of Authority, Conduct Prejudicial to the Best Interest of the Service and Gross Neglect of Duty for the second case.

Ramirez alleged that the proponents committed the said offenses

when they awarded the contract for the printing, supply and delivery of Seafarers Identification and Record Books (SIRB) to APO Production Unit Inc. (APO) without any supporting Bids and Awards Committee (BAC) resolution.

He further claimed that the memorandum of agreement (MOA) between Marina and APO downgraded the features of the SIRB by removing the symbology and security features, among others.

The Ombudsman said with regard to the charge of violation of Section 3(e) of RA 3109, as amended, the complainant failed to establish that the respondents acted with manifest partiality, evident bad faith, or gross inexcusable negligence.

Further, the Ombudsman resolves that contrary to complainant’s allegation, the award of the contract to APO for the procurement of 200,000 pieces of SIRBs (Seafarers Identification and

Record Books) and stickers was duly covered by BAC Resolution 201407 dated February 6, 2014.

Moreover, the Ombudsman avers that the complainant did not present any proof that the removal of the symbology features in the SIRB was done in bad faith or that it compromised the SIRB’s integrity or quality as machineread able, Inter nat iona l Civ i l Aviation Organization standardcompliant document.

Significantly, the removal of the symbology features resulted in savings for Marina of P107 per SIRB. As one of the recognized government printers authorized to print government accountable forms, APO submitted the lowest quotation for the procurement of 200,000 pieces of SIRBs and stickers for 2014, amounting to P59 million, or P295 per SIRB. The price quoted was well within the approved budget for the contract of P60 million.

Philexim financing reaches ₧6B in Visayas, Mindanao

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tate-owned Philippine Export-Import Credit Agency (Philexim), a financial institution attached to the Department of Finance (DOF), has provided a total of P6 billion in guarantees and loans to key industries in Visayas and Mindanao as of September 30, 2015, boosting the government’s economic pumppriming of strategic projects in those regions, officials said.

Philexim Officer in Charge Florencio Gabriel Jr. said the efforts of Philexim resulted into better opportunities for the export and priority sector businesses, particularly in the regions where the ultimate objective is to create jobs and provide competitive business opportunities.

“Our developmental mandate has remained the driving force of Philexim to continue partnering with the pri-

vate sector in furtherance of economic progress,” Gabriel said.

To keep in stride with the expanding market needs, as well as the increasing institutional presence in the Visayas region, it has relaunched its newly refurbished Cebu Business Center at the Keppel Center, Cebu Business Park in Cebu City. Members of the Philexim Governing Board led by DOF Assistant Secretary Soledad Emilia Cruz, senior officers and other guests graced the blessing and re-launching ceremonies.

The Philexim Governing Board likewise held their 357th Regular Meeting in the Agency’s refurbished branch.

“I exhort the men and women of Philexim to continue advancing sustainable development financing especially in the midst of the upcoming Asean integration,” Cruz said, representing Finance Secretary and

Philexim Board Chairman Cesar V. Purisima. “Along this pursuit, I am confident that Philexim will continue to be an economic catalyst and reliable partner of government towards ensuring progress and stability.”

Philexim FSVP and Chief Strategy Officer Ian A. Briones said the upgrading of the Cebu branch, which first opened its doors to exporter clients in 1994, is the institution’s primary hub outside its Makati City headquarters.

He noted that the refurbished Cebu Office is part of Philexim’s institutional building program envisioned under its brand slogan, “Ensuring the Country’s Economic Momentum.”

“We would like to showcase the Cebu Office as a means to further build the Philexim brand that will cater to greater financing opportunities in the Visayas segment of the market, where

key medium and large enterprises are representing a strong foothold in Cebu province alone,” said Briones, also the institution’s Head of Strategy and Development. “We hope the Cebu Business Center in the Visayas will usher in more development projects.”

Briones further explained that Philexim’s credit portfolio, which mainly includes clientele in the Visayas and Mindanao areas, represents the priority areas of small-medium enterprises, manufacturing, infrastructure, tourism and energy among others. He added that by end-2015, Philexim will attain a development impact of more than 80 percent representing regional access to financing. “By ensuring a high percentage of regional access to financing, Philexim is making headway in its efforts toward development financing,” Briones explained.

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Quiet air zone shows struggles of China to control contested sea

Manila, Paris revive joint economic working group

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A

S the battle for control of the South China Sea heats up, Beijing’s struggle to assert its authority over another disputed waterway may prove instructive.

China has been warning planes away from reefs it reclaimed in the South China Sea, and has said it reserves the right to announce an air defense identification zone (Adiz) over the area. It’s expected to boost its military presence after the US this week sailed a warship into the 12-nautical-mile zone around China’s man-made islands.

But controlling the seas may prove easier for China than controlling the air, according to observers, even after the US incursion and with further patrols expected. The US warship did not venture far inside the 12-mile zone, where China’s coast guard is practiced in providing a ring of deterrence.

China has already faced difficulty enforcing an Adiz it set up two years back covering islands disputed with Japan in the East China Sea, which is closer to the Chinese mainland. Setting up and maintaining a zone over the much larger South China Sea—which stretches along the coast of Vietnam, across to the Philippines and down to Singapore and Indonesia— would be even harder.

“The South China Sea is a completely different beast,” said Li Jie, a senior researcher at the Chinese Naval Research Institute in Beijing.

“The territorial disputes there involve many more countries, and if you take out a map, the topographic features are much more complex. It’d be more provocative in the eyes of the Americans.”

Lacking enforcement

Since setting up the East China Sea air zone—through which the US swiftly flew B-52 bombers— China has quietly stopped seeking to actively enforce it, according to military officials and policy advisers who have followed the issue. That’s despite initial warnings the military might use force against planes that failed to follow rules including the requirement to file flight plans.

The air zone is technically in operation in the sense China’s air force patrols it, but it has never taken “defensive emergency measures” set out in the initial announcement, which could include interceptions of planes.

The People’s Liberation Army (PLA) lacks the ground-based air surveillance and a detailed joint operational plan between the air force and navy to “fully and effectively” administer the entire zone, according to a former senior PLA officer who spoke on condition of anonymity.

Military aircraft

There are also strategic considerations: If China were to intercept aircraft that didn’t follow its rules, it could potentially risk a clash with a country like Japan, which has a welltrained, efficient air force, or the US. “It is my understanding that China has never sought to fully enforce the Adiz as it pertains to military aircraft,” said Bonnie Glaser, a senior adviser for Asia at the Center for Strategic and International Studies.

“This is partly a function of insufficient capability,” she said. “It is also because China does not want a military confrontation with Japan.”

The initial announcement of the

he Philippines-France Joint Economic Committee (JEC) has been revived by the two countries after a 12-year hiatus, signaling their intention to improve trade and investment engagement, especially in the aerospace and aeronautics sector. air zone brought some confusion.

While the rules were supposed to apply to all aircraft entering the area, the defense ministry later said commercial flights by foreign airlines would not be affected.

Japan Airlines (JAL) and All Nippon Airways don’t report flight plans to China and haven’t done so for almost two years. They only reported their plans for several days in the aftermath of the zone’s announcement. JAL is not aware of any issues related to the nonfiling of such plans, said Tokyo-based spokesman Jian Yang.

‘More mature’

The Adiz could have been conducted “in a more mature manner,” said Shen Dingli, associate dean of the Institute of International Studies at Fudan University in Shanghai. Beijing could have learned from the US, the first country to set up an air-defense zone in 1950 over North America, Shen said. The US carried out a three-month pilot program beforehand.

The East China Sea zone only served to strengthen ties between Japan and the US Visiting Japan in April 2014, President Barack Obama said the islands were covered by the US-Japan security treaty and the US would oppose any attempt to undermine Japan’s control of them.

“This was a direct reaction to the Chinese announcement of the zone, and the Americans were effectively telling the Chinese: don’t do your zone, because I’m still No. 1 in the region,” Shen said.

Naval weakness

Similarly, in the South China Sea, the US might be compelled to assist another regional ally, the Philippines. Other Southeast Asian nation claimants to the South China Sea like Vietnam have drawn closer to the US in recent years.

While the Chinese military has made advances in building its naval force in the last decade, including rolling out its first aircraft carrier, it also suffers serious weaknesses, according to a Rand Corp. report released earlier this year. The military has not fought a major war since a border fight with Vietnam in 1979.

That may not deter China given President Xi Jinping’s eagerness for the country to become a military power, something he has spoken of as a return to China’s natural state.

‘A blessing’

“The escalation in the South China Sea might be a blessing in disguise, and it can actually turn into a good thing,” said Colonel Liu Mingfu, a professor at China’s National Defense University. “It would help boost solidarity in the military, adding an extra sense of urgency to put in more effort to strengthen the navy, and drive home the point that economic development is not enough if China wants to become a true power.”

Both sides are likely to move carefully for the next few months, said June Teufel Dreyer, a University of Miami political science professor.

“But then China will push forward again, perhaps saying it was ‘forced’ to do so by some action, either by one of the claimants, perhaps Vietnam or the Philippines,” she said. “And the US will feel it has to do something in response. That’s when things could get dangerous.” Bloomberg News

Friday, October 30, 2015 A5

Trade Secretary Gregory L. Domingo and French Minister of State for Foreign Trade Mathias Fekl met in France last week to reconvene the Philippines-France JEC, which last convened in 2003.

Trade Undersecretary Adrian S. Cristobal Jr., who made an earlier trip to the European country, said the revival of the JEC is in line with the Department of Trade and Industry’s (DTI) pursuit of attracting more investments in aerospace and aeronautics.

“The aerospace and aeronautics sector is an area that both the Philippines and France are eager to pursue. This is a growing sector with huge potential for the Philippines to become an aerospace hub in the field of aircraft maintenance and production. We welcome the commitment to deepen existing cooperation between

the civil-aviation agencies of the Philippines and France and the companies in the aerospace sector,” Cristobal said.

Aside from aerospace and aeronautics, the JEC is also aimed at broadening cooperation in the areas of creative industries, tourism and sustainable development.

In an earlier forum, Domingo confirmed the talks between the DTI and Airbus. He said Airbus plans to increase its purchase of parts from Philippine-based suppliers.

Parts suppliers based in the Philippines, such as Jamco Inc. and Moog Controls Inc., already supply aircraft components to the likes of Boeing and Airbus.

The Philippines’s domestic aerospace industry has an estimated 0.15-percent share in the 2013 GDP. It is projected to increase to

CRISTOBAL: “The aerospace and aeronautics sector is an area that both the Philippines and France are eager to pursue. This is a growing sector with huge potential for the Philippines to become an aerospace hub in the field of aircraft maintenance and production. We welcome the commitment to deepen existing cooperation between the civil-aviation agencies of the Philippines and France and the companies in the aerospace sector.”

0.57 percent by 2022.

It contributes 2,200 in direct employment and generates an estimated $10 million in salaries of direct and allied workers. The next JEC meeting is slated to take place in Manila next year.

Preparatory seminars and conferences will be conducted to increase cooperation between the Philippines and France. The main goal is to improve their linkages in the global supply chain for aerospace.

Other collaborative actions are in the areas of ecotourism, creative industries and climate change, among other areas.

In 2014 France was the Philippines’s 13th top trading partner, with total bilateral trade valued at $2.57 billion, accounting for 2 percent of the Philippines’s total external trade.

A6 Friday, October 30, 2015 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Slapping the dragon’s face

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few days ago, after much fanfare and publicity, the United States sent one of its warships within the 12-mile range of one of China’s reclaimed “islands.” Philippine commentators applauded this as firm move by the US government to show China that it must respect freedom of navigation and international maritime rules for “innocent passage.”

The Chinese did just that.

In September five Chinese warships entered within the 12-mile coastal waters off Alaska. There also, the Chinese exercised its rights of innocent passage. So what is the difference?

The Chinese government is composed of a group of petty and troublesome people, obviously with an inferiority complex and are, using the Filipino word, pikon—touchy or short-tempered. But the US often acts the same way.

Previously, Beijing had demanded that the US warships should request permission before making their own “innocent passage” in Chinese territorial waters. The key words, of course, are “territorial waters” but even then, no one is required to request such permission. Yet, in a sense, by announcing weeks in advance of its intentions to sail those waters, the US nearly did ask for permission. Would the US have continued its action if the Chinese government had said beforehand that it would attack any vessel in its so-called and claimed territorial waters?

The US constantly makes innocent transit through other nation’s straits and international waterways near sovereign territory without any prior notification. That is why, in a sense, this was partially a public-relations stunt.

The Chinese action of dumping a few hundred tons of sand on a partially submerged reef and calling it their territory is laughable by any legal standard.

However, much of international law is valid because nations acknowledge the validity. A newly declared independent nation is only sovereign when other countries acknowledge that sovereignty. If Vietnam, Malaysia, Taiwan, and even Singapore and Indonesia suddenly recognized China’s territorial claims, China would have an interesting legal foundation.

The US reportedly sent the USS Lassen on this mission. This is an Arleigh Burke-class destroyer, one of the most formidable and dangerous war machines ever built. The Chinese shadowed the Lassen with their own warships at a distance of several thousand yards, which is about the same as you driving down the highway behind the car in front. The exercise put about 700 sailors equipped with the most advanced weapons on the planet, highly trained to inflict the most damage in the shortest amount of time when called to do so, in a situation where any mistake on either side could have ended in a fierce battle.

Nothing has been resolved. The US says it was sailing in international waters; China says territorial waters. However, what this has done—knowingly or by mistake—is to force the US to involve itself in the territorial dispute that it has, up to this point, avoided.

If the Lassen was sailing in international waters, then the US is finally and firmly saying with more than words that the territorial claims of China are not valid. The West Philippine Sea game has just changed.

No more time James Jimenez

I

spox

F you’re reading this in the morning, and you haven’t validated your registration, or even registered to vote in the 2016 elections yet, then this will be one of those rare instances when reading this column will be of immediate and tangible use to you.

So, go through the lists below and find out where you can go—today (Friday) and tomorrow (Saturday)—to register, or, if you’re already a registered voter, to validate your biometrics.

October 30 Eastwood Mall; Third District of Quezon City: 10 a.m.-6 p.m.

Gaisano Grand Mall Digos; Digos, Davao del Sur: 10 a.m.-5 p.m.

Lucky Chinatown Mall; Third District of Manila: 10 a.m.-5 p.m.

Mall of Asia; First District of Pasay City: 10 a.m.-6 p.m.

Pacific Mall Lucena; Lucena City, Quezon: 10 a.m.-6 p.m.

Pacific Mall Mandaue; Mandaue City, Cebu: 10 a.m.-5 p.m.

Puregold; Second District of Caloocan City: 10 a.m.-6 p.m.

Robinsons Forum; Mandaluyong City: 10 a.m.-6 p.m.

Robinsons Otis; Sixth District of Manila: 10 a.m.-5 p.m.

Robinsons Place Dumag uete; Dumaguete City, Negros Oriental: 10 a.m.-5 p.m.

Robinsons Place Las Piñas; Las Piñas City: 10 a.m.-5 p.m.

Robinsons Town Mall Malabon; Malabon City: 10 a.m.-5 p.m.

SM Aura; Taguig City: 10 a.m.-6 p.m.

SM Manila; Fifth District of Manila: 10 a.m.-5 p.m.

SM City Marikina; Marikina City: 10 a.m.-6 p.m.

SM San Lazaro; Fourth District of Manila: 10 a.m.-5 p.m.

SM Sangandaan; First District of Caloocan City: 10 a.m.-6 p.m.

Starmall Activity Center; Muntinlupa City: 10 a.m.-5 p.m.

Tutuban Mall; First District of Manila: 10 a.m.-5 p.m.

October 31 Eastwood Mall; Third District of Quezon City: 10 a.m.-6 p.m.

Gaisano Grand Mall Digos; Digos, Davao del Sur: 10 a.m.-5 p.m.

Lucky Chinatown Mall; Third District of Manila: 10 a.m.-5 p.m.

Mall of Asia; First District of Pasay City: 10 a.m.-6 p.m.

Pacific Mall Mandaue; Mandaue City, Cebu: 10 a.m.-5 p.m.

Puregold; Second District of Caloocan City: 10 a.m.-6 p.m.

Robinsons Otis; Sixth District of Manila: 10 a.m.-5 p.m.

Robinsons Place Dumag uete; Dumaguete City, Negros Oriental: 10 a.m.-5 p.m.

Robinsons Place Las Piñas; Las Piñas City: 10 a.m.-5 p.m.

Robinsons Town Mall Malabon; Malabon City: 10 a.m.-5 p.m.

SM Aura; Taguig City: 10 a.m.-6 p.m.

SM City Marikina; Marikina City: 10 a.m.-6 p.m.

SM Manila; Fifth District of Manila: 10 a.m.-5 p.m.

SM Megamall; Mandaluyong City: 10 a.m.-6 p.m.

SM San Lazaro; Fourth District of Manila: 10 a.m.-5 p.m.

SM Sangandaan; First District of Caloocan City: 10 a.m.-6 p.m.

Starmall Activity Center; Muntinlupa City: 10 a.m.-5 p.m.

Tutuban Mall; First District of Manila: 10 a.m.-5 p.m.

If, on the other hand, you’re one of the more than 50 million people already comfortably ensconced in the list of voters, take this time to sit back and congratulate yourself on having both the foresight and the discipline to have gone to the offices of the Commission on Elections (Comelec) while there was still a lot of time to do it and when the queues weren’t anywhere near the lengths they are now. And while you do that, let me regale you with a story.

Back in May 2014, the Comelec started telling people about mandatory biometrics and the need to register and so on. Obviously, one of the key messages was that the registration period would end in October 2015.

As October 2014 rolled in, I got reports from a field office, telling me that they were seeing a build-up of people, asking—demanding—to be given application forms. My curiosity piqued, I went to the field office and sure enough, there they were, forming queues and fanning themselves impatiently. Some, if memory serves, were even grumbling

about how inefficient the Comelec was.

I walked up to the least agitated person there and asked why there were so many people lined up for registration.

He looked at me like I was insane and said: “It’s the deadline for registration!”

It took me half a second to realize that the person I was talking to, as well as the others who by that time, had started to crowd around us, thought that the deadline was October of that year and not the next.

After a long and animated internal debate during which the better angels of my nature prevailed over the angels who appreciated a good prank, I decided to come clean. “The deadline is October 2015, not 2014,” I declared to the people gathered around me.

A wave of relief passed over the assembled people and you could almost hear them heave a collective sigh of relief.

Then, like the sound of rain just starting to fall on a tin roof, the giggles started— sheepishly—growing in volume until some were out and out laughing at the mistake they’d made.

I started laughing too, until I realized that the crowd was rapidly thinning.

Wiping away tears of mirth, I looked around and saw people drifting away in ones and twos and threes.

“Wait!” I said. “Where are you going?”

Home, someone said. The mall, another one shouted, to be met with a roar of approval from the group he was with. The office, said a third.

“Why not just stay and register?” I asked.

“The deadline isn’t until next year.

We have time.”

Well, not anymore.

James Arthur B. Jimenez is director of the Commission on Elections’s education and information department.

Opinion BusinessMirror

opinion@businessmirror.com.ph

How to step up for breast cancer awareness beyond October Niña Terol

Women Stepping UP

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ctober is Breast Cancer Awareness Month, and we saw a lot of brands and women advocates step up to support the cause of this month. From hotels to beauty and fashion brands—to even mushrooms—enterprises of all sorts turned pink to promote breast cancer awareness.

And all for good reason: breast cancer is curable, and it is best treated with early detection. According to 2015 data from the American Cancer Society, the “five-year relative survival rate” of patients with Stage 0 and Stage 1 breast cancer is 100 percent, while that of Stage 2 breast cancer patients is 93 percent, and those of Stage 3 breast cancer patients is 72 percent. Unfortunately, the survival rate of Stage 4 breast cancer patients is only 22 percent, so, indeed, the best way to save a life in this case is to find and fight the cancer early on.

Moreover, ICanServe Foundation, a nonprofit organization dedicated to educating women and communities about breast cancer, says in its web site: “The Philippines has the second highest incidence of breast cancer in Southeast Asia (Globocan 2012, International Agency for Research on Breast Cancer). Breast cancer is also one of the leading causes of death among Filipino women.”

According to Carla Paras-Sison, a breast cancer survivor and chairman of the Information, Education and Media Committee of ICanServe Foundation, “Many women forego [breast cancer] screening…for fear of finding out the worst. We must assure them that breast cancer can be cured best at the earliest stages and that help [mostly financial/medical, but also moral] is available to those diagnosed under [ICanServe Foundation’s] program.”

‘Talk and touch’

Breast cancer is one case when we should get more people to “talk and touch”: 1) talk about it with as many women (and men, too) as possible; and 2) encourage others to take the necessary steps to detect breast cancer symptoms early.

According to Paras-Sison, “At age 20, women should do a monthly breast self-exam [BSE]. At age 30, women should undergo an annual clinical breast exam [CBE] by a trained health worker, and continue [the] monthly BSE. At age 40, women should get a baseline mammogram, and continue [the] annual CBE and [the] monthly BSE. These are life-saving tips we must encourage women to observe.”

ICanServeFoundation.org features videos—in English, Filipino and Cebuano—that show how to properly conduct a breast self-exam.

“Ating dibdibin”

Because health-care access is not equitable throughout the country, ICanServe Foundation also empowers barangay health workers to be at the frontline of breast cancer detection, through a program called “Ating Dibdibin.”

According to Paras-Sison, “In many places in the Philippines, women have no access to doctors, hospitals and mammograms…

ICanServe [through Ating Dibdidin] trains barangay health workers to do clinical breast exam so they can help refer women with suspicious lumps to better care providers. ICanServe conducts Ating Dibdibin in partnership with LGUs [local government units] because it wants to provide a circle of support to anyone diagnosed with the deadly disease.”

She adds, “It is our hope that as more LGUs institutionalize Ating Dibdibin [training barangay health workers and providing diagnostic and treatment support], breast cancer will be diagnosed at earlier and earlier stages instead of in the late stages.”

Be a ‘Pink Warrior’

Here are four ways to step up and be a “Pink Warrior” against breast cancer: Organize breast cancer awareness drives in your company, organization or community.

Through ICanServe Foundation, the Philippine Cancer Society and other related groups, you can invite experts to share the necessary information and advice about breast cancer. To work with ICanServe Foundation for screening and education, e-mail karamalikpala@gmail. com and lanieusebio@yahoo.com.

“October is our peak season, so we encourage those who wish to partner [with us] to contact our advocacy committee early,” ParasSison advises.

Purchase products that support the breast cancer awareness cause, or donate to ICanServe Foundation. For a list of products and events to support or to donate online, visit www.icanservefoundation.org.

Sponsor your househelp and have them checked. “Those in the informal sector are at high risk,” Paras-Sison points out. “We need to teach them to seek help, to go for [a] CBE at the barangay clinic, [or] to get a mammogram. Many will not be able to afford mammograms so women [and men] can sponsor women needing mammograms.”

Be a ‘pink partner.’ To extend the wordplay, a “pink partner,” in this writer’s definition, is an organization or enterprise that supports the breast cancer awareness advocacy through its products or services. You can develop special products or packages specifically for Breast Cancer Awareness Month, or donate proceeds of your sales to ICanServe Foundation, the Philippine Cancer Society, or any credible organization that supports breast cancer programs.

There are many ways to help, limited only by the scope of one’s imagination and creativity. As we end October and push on to the last two months of the year, it is our hope that more individuals and organizations collaborate for causes and advocacies that truly matter to them, to make the world a healthier, happier, safer and more sustainable place.

Niña Terol (@ninaterol) calls herself a “communicator, connector, idea curator and change-maker.”

She heads corporate affairs for the largest multinational integrated marketing communications firm in the Philippines, is a founding trustee of Business and Professional Women (BPW) Makati, and has been widely published in local and international publications.

This article reflects the author’s opinion and is not the official stand of the BPW Makati. Women Stepping Up is a rotating column of members of BPW Makati and comes out twice a month. For more information on BPW Makati, visit www.womensteppingup.org.

Friday, October 30, 2015 A7

Organizing autumn Tito Genova Valiente

annotations

I

f the Japanese could organize seasons, they would.

I am in Tokyo as I write this upon the invitation of the Tokyo International Film Festival (TIFF) International Relations and the Japan Foundation Asia Center.

The festival is on its 28th year. The Japan Foundation Asia Center by itself, works with Asian partners in the field of arts and culture. Since 2014 the two institutions have started working together in projects aimed to deepen understanding and facilitate networking between Japan and the other Asian countries through their film industries.

This year the TIFF and Japan Foundation Asia Center are behind the flurry of activities around the so-called Roppongi Hills and in some movie houses in Shinjuku.

These two places have a past. A part of the Japanese Imperial Army set up headquarters in the area in the 1890s. Where you have soldiers, you have entertainment centers. After the war, the American forces set up offices in the said place. Nightclubs and bars proliferated in Roppongi, catering mostly to foreigners.

Shinjuku is where you can find Kabukicho, an acclaimed red-light district where love hotels of varied persuasions and designs exist. If one can be anecdotal about things, Kabukicho was where I, in my years of stay in Tokyo, saw brawls erupt and where drunkenness was not only tolerated but almost a badge of honor.

Locations, however, always have two faces. Shinjuku, for example, on the side away from the clubs and bars, is where you can find the mega Tokyo Metropolitan Government

Building occupying more than 2 million square feet of floor area. It is built by world-famous Kenzo Tange, who also designed the Hiroshima Peace Memorial Museum. Roppongi has, in a sense, changed its spirit, too.

The vast Roppongi Hills is elegance and sophistication.

Around the area I saw how the Japanese organized events related to the TIFF. All the while, I thought all of the staff were paid or in full-term contract. There were volunteers who were paid because that is the system in Japan; there were, however, volunteers who were mostly students, who were there for the experience.

The students were selected mostly for their personality and good command of English. Personable and approachable, the student-volunteers took care of guests as we moved from one venue to another, as guests who were there for the first time in the megalopolis, called Tokyo, were instructed how to navigate the subways in the city.

There is a volunteer assigned in each hotel and no matter the hour, no one is ever late for the guests. If the time is four in the afternoon, and we are at the lobby before that, there would always be message from the volunteer explaining he would be sukoshi okure ni narimasu—a bit late.

That means he could not be there a few minutes before the time assignation. Upon arrival, the volunteer

would ask if we waited long for him.

The volunteers know their place in the scheme of things. Lunch meeting or dinner indicates they would fetch the guests from the hotel, bring them to the restaurant. Their duty ends at the entrance. Do not invite them to join you as this would embarrass them and diminish the nobility of their tasks. Do not judge the organizers when the volunteers tell you they are not allowed to join the event—a dinner, a cocktail party—for their statement is nonnormative. The situation is the same when a Japanese tells you he does not have a religion. His statement is not meant to shock you. It is just that he has no religion.

As a guest, a special one this time, I am getting to know a culture, or at least a city, whose quirks and charm I thought I had already known. Perhaps, I am observing more the traits of the Japanese up close and not through long shots of a camera, or the generalizing strength and weakness of a fieldwork.

Allow me to be essentialist. The season is a theme by which the Japanese organize their life, and their art.

On October 26 the TIFF issued an invitation for a gala event in the

Kabuki-za. This is a revered theater designated for Kabuki performance right at the heart of Ginza, the symbol of modern Japan. The special event was a screening of Kurosawa Akira’s 1945 film They Who Step on Tiger’s Tail. Before the film, a dance from “Kanjincho,” the Kabuki play on which the said Kurosawa film was based, was performed.

As with any Kabuki performance, a special o-bento box or meal box was prepared for the occasion.

Here is what Hidekatsu Shoji, master chef of Kabuki-za, says about the meal he has prepared for the special night: There will be “an array of delicacies, such as the sushi rolled in seaweed, to reflect the shape of Kanjinchô (literally, the subscription list, a piece of paper showing one’s donation to a temple); sweet potatoes and turnips from Ishikawa Prefecture where the Ataka Barrier is (Ataka is the title of the Noh piece which inspired the Kabuki Kanjinchô). Please also enjoy the taste of autumn, such as roasted chestnuts and shiitake mushroom.”

On top of the food was a real autumn leaf.

E-mail: titovaliente@yahoo.com

A primer on quantitative easing and its effects on global markets Riz L. Jao

Q

EAGLE WATCH

uantitative easing (QE) once again made headlines as markets around the world ended last week on a high note—with the Standard & Poor 500 up 2.04 percent; the Euro Stoxx 50 up 4.70 percent; the FTSE 100 up 1.44 percent; the Nikkei up 3.83 percent; the HSI up 0.33 percent; the STI up 1.45 percent; and our very own Philippine Stock Exchange index (PSEi) up 2.57 percent—after European Central Bank (ECB) President Mario Draghi’s comments on the ECB’s plan on lowering interest rates further and expanding its QE program amid Europe’s soft economic results thus far. For people regularly involved in the markets, fears brought about by the tapering of QE was the bane of the PSEi’s bull run in 2013. Hence, it needs no introductions. But for others, it’s a nebulous concept. So, it’s good to take a closer look at what QE is and why central banks around the world have used it.

Under normal market conditions, the central bank is able to optimize monetary policy, largely by dictating the country’s benchmark interest rate/s—by adjusting the rates it lends to banks and the reserve requirements it imposes upon them. These then trickle down to instruments of longermaturities taking into consideration inflation, output gap and unemployment. This is commonly referred to as the Taylor Rule in textbook Economics.

But after the bursting of the subprime mortgage bubble in 2008, the Taylor Rule began prescribing negative interest rates—this is problematic because savers can always opt to hold their savings in cash (with a zero interest rate) versus paying the bank to hold their money (which is essentially what happens in a negative interest-rate environment). Thus, conventional monetary policy was ill-equipped to deal with this recession.

This set the stage for QE, which gained prominence and became a household term when the US applied it. However, it was actually introduced in Japan way back in the 1990s (also after the bursting of the Japanese real estate bubble). Basically, QE involves the central bank purchasing financial

assets from banks in exchange for reserves, which the banks can then lend out to others. In theory, this was the rationale behind QE, to try to boost real economic activity. In reality, however, it seems like banks have used the extra reserves to simply buy other financial assets resulting in the worldwide bull market we have seen this last few years.

Now, in order to gain a deeper understanding of what QE means for markets, we must first look at how it influences interest rates—both in the short term and in the long term.

Strictly speaking, QE actually does not have a direct effect on short-term interest rates, but it does tend to signal the central bank’s intention with regard to its key policy rate/s. This is why the US Federal Reserve (the Fed) continually reassured markets that they would keep the federal funds rate near zero percent as they winded down QE last year.

QE has a more direct effect on the longer termed interest-rate curve, this is because the central bank’s purchases of long-term bonds reduces the supply of long securities in the market. This will push up their prices and decreasing their yields or their interest rates. This

is what we mean when we say that QE makes borrowing cheaper. We can see this fact clearly from the graph below which details the 10-year government bond yields of the US, the UK, Germany and France covering the period from 2007 to 2014.

The interesting thing, though, is that this is not just limited to longterm fixed income securities, higher risk assets, such as the US and emerging-market stocks also benefited from this “forced blunting” or lowering of the risk premium, resulting in higher valuations for those asset classes as well. The graph below shows the main stock indices of the US, the UK, Germany, France and the Philippines also covering the period from 2007 to 2014.

Putting it all together, we now have

Source: Federal Reserve Bank of St. Louis

Source: Yahoo! Finance

an idea of how QE affects global markets. Because it lowers the risk premium, QE tends to raise the prices of bonds and other higher risk assets— this is why a lot of stock markets went up after Draghi’s announcement.

But just like anything else in the world, QE is not a free lunch for investors. In fact, QE is actually a bad signal because it means that the central bank thinks the economy is performing below par—and, thus, needs a helping hand. It is ironic then how we take QE as a good sign for markets. I guess the consensus is simply, “Let’s keep the music playing.”

Riz L. Jao is a lecturer of Economics and a research associate of Eagle Watch at the Ateneo de Manila University.

2nd Front Page BusinessMirror

A8 Friday, October 30, 2015

PHL property sector seen to withstand China gloom

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By Roderick L. Abad

XTERNAL events, like the slowing Chinese economy, should not dampen the high spirits and bullish outlook of the real-estate industry in the Philippines as it plans to expand even more in the coming years given strong and continued market demand, a top property management executive said on Thursday.

According to Luis Enrique T. Mangosing, Metro Development Managers Inc. CEO, the local property sector has remained bullish for more than a decade now and its growth momentum should still be sustained over many years to come.

“In fact, I think this year commercial developments will turn over more than half-a-million square meters of space, enough to meet local demand,” he told reporters at the Philippines Property Awards 2016

ceremonies in Makati City.

“If you compare it to Singapore, you’ll be lucky with a 10,000 sq m [set for] completion in the same year. So that’s how big the Philippine [real-estate] market is nowadays. And the developments are not concentrated [only] in Metro Manila anymore, [as] we do have satellite developments in Cebu, Bacolod, Iloilo, Davao. That’s the beauty about the Philippine realestate industry. It’s [growing] everywhere,” he added.

Mangosing also cited the strong activity in other property subsectors, like the office segment that is much in demand among business-process outsourcing (BPO) locators.

“I’d like to think that more than 50 percent of the [office-space] demand is being driven by BPOs and call centers,” the top executive said.

As per the recent report of property consultant Pinnacle Real Estate Consulting Services Inc., the local office market has remained robust in the third quarter of this year on the back of strong demand, low vacancy and increasing rent rates.

Based on the company’s Market Insight Report for September 2015, office-space takeup in Metro Manila has continued to expand, with some 40,000 sq m already filled up by BPO companies the past three months.

Over a thousand firms now comprise the country’s BPO industry, employing over 1 million people as of end-2014.

Given the quick and massive absorption of office space, the overall vacancy rate at the central business districts (CBDs) in the metropolis is below 3 percent no matter the acccel-

erated pace of supply.

The huge uptake on office space is because, compared to other markets in the region like India, Hong Kong and Indonesia, among others, the Philippines still offers the lowest office rental rates, it was said.

The Pinnacle research also revealed that rental rates in Makati City grew by approximately 1 percent quarter-on-quarter, with monthly charges ranging from P675 per sq m to P1,280 per sq m.

In other CBDs, both Ortigas and Alabang have average monthly rental fees of P650 a sq m, P870 a sq m in Bonifacio Global City, but a bit cheaper in Quezon City at only P625 per sq m.

Expected to expand with 1.3 million jobs and projected annual growth of 17 percent by 2016, the BPO industry demand for office space should continued to rise as more and more outsourcing companies increasingly look to set up shop not only in the metropolis but also in the so-called next-wave cities around the country.

As for the residential sector, Mangosing said there already are

LI FLOATS NEW FIVE-YEAR GROWTH GOAL AT MINIMUM OF AROUND 6.5 PERCENT

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remier L i K eqi a ng highlighted a minimum growth estimate for China in the coming five years that could indicate the leadership’s readiness to accept the weakest period of expansion since the economy was opened up three decades ago.

The nation needs annual growth of at least 6.53 percent in the next five years to meet the government’s goal of establishing a “moderately prosperous society,” Li said in an October 23 speech to Communist Party members, according to people familiar with the matter, who asked not to be named as the remarks weren’t public.

Communist Party leaders today conclude a four-day gathering to discuss their 2016-2020 five-year plan for the nation, the first since President Xi Jinping and Li took office.

“It seems that Premier Li is sending a signal through his speech that China’s government is likely to lower their growth target to 6.5 percent in the 13th five-year plan,” said Le Xia, a Hong Kong-based economist at

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FTA talks. . .

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Banco Bilbao Vizcaya Argentaria SA. “The 6.5-percent target is still a little challenging. A target of 5 percent to 6 percent seems a more feasible one.”

Private economists have predicted a lowering in the five- year growth target to 6.5 percent, down from 7 percent in the current plan—a reflection of the Communist leadership’s continuing attempts to move away from debt-fueled expansion.

C h i n a’s c e nt r a l b a n k shouldn’t adopt quantitative easing to flood the economy with too much money, Li said, according to the people. The comment underscores how the People’s Bank of China has opposed US and Japan-style direct purchases of assets in its campaign to ease liquidity and shore up the weakest expansion in a quarter century.

The State Council didn’t immediately respond to a faxed request for comment on Li’s remarks.

Li, speaking to the Communist Party Central Committee’s Party School, underscored China’s avowal to avoid cheapening the yuan as a tool to stoke

Continued on A2

‘Print industry is alive with emergence of millennials’

HILE many say the industry is destined for extinction, today’s print industry is very much alive and kicking as it embraces the digital era. The industry also looks to a brighter future given the new generation of markets that is both content- and technologysavvy, according to a traditional media expert.

BusinessMirror Vice President for Corporate Affairs Ricky Alegre emphatically said the print media “is not dead,” as it has adopted well to the digital age taking place globally via modern technologies and innovations that enable it to deliver news and other content to readers through print or online platforms.

“The print media industry still is the No. 1 producer of content because our discipline is such that our reporters [or] our writers run and do stories daily, depending on what they are covering; and we’re the only one who does it in such a way that it is submitted every day,” he said on the sidelines of the just-concluded Asia Digital Transformation Summit 2015 in Makati City.

“News evolves, so we should not be threatened [by the digital transformation]. In fact, we should embrace it because this is how we reach out to the younger readers, who are [following] us, maybe not in our [own] platform but still recognize [information] came from the print medium,” he quickly added.

Since the daily publications in the country—be they mainstream or business-oriented—have metamorphosed from a newsroom that is strictly for hard copy to digital, and social media that the current generation of young readers called the millennials more often than not have turned to the print media for content. He urged print-media players to invest more in digital technologies and be more engaging when it comes to content since the millennials are the “future readers and leaders” who will continue to

www.businessmirror.com.ph

Print media is alive according to speakers at the Asia Digital Transformation Summit 2015, including (from left) Frank Shrope, director for Sales and Marketing of PhilPay; Frederick Alegre, vice president for Corporate Affairs of the BusinessMirror; and Vikram Singh, Philippines country manager of Tata Consultancy Services. NONIE REYES

Telstra readies PHL war chest. . .

Bray did not elaborate. But Telstra chief executive Andy Penn was more open to answer pending questions.

“We are not expecting it to be more than $1 billion—that would be essentially Telstra’s equity investment. We could own 40 percent of the venture, which would also have external financing as well,” he was quoted by Australian news agencies as saying. This investment is only from the side of the Australian regional carrier. The Filipino diversified conglomerate will also pump in money from its own war chest for the said joint venture.

No deal has been reached as of the moment. San Miguel President Ramon S. Ang was not responding to the BusinessMirror’s clarifications.

“Frankly, let’s face it, go to the Philippines and experience the lousy service you get from the incumbent operators and you will see that [there’s] opportunity for a new operator to provide a much better quality service.… I think there’s a significant opportunity,” Penn was quoted as saying.

The new joint venture—expected to

go live via Bell Telecommunications Philippines Inc.—may launch commercial operations as early as end-December. The Filipino conglomerate is currently building up its network, setting up base stations in various parts of the country.

‘Enough’

According to Cabarios, a $1-billion investment even from Telstra alone is a welcome development for the industry.

The amount is also enough to finance the deployment of a national network.

“A billion dollars is a billion dollars—it is significant. Building a network with that amount is big enough to compete with the present players,” he told the BusinessMirror. “The amount is enough to start a new player with a nationwide network.”

But the $1-billion capital is simply the initial investment on Telstra’s side. San Miguel, which is expected to hold a 60-percent shareholding in the joint venture, is also expected to pump in as much as $1.4 billion to complete the investment.

“San Miguel can finance such a deal, but they may have to sell assets or issue

bonds or equities to finance the the jointventure requirement,” Alexander Adrian O. Tiu, senior equity analyst at AB Capital Securities Inc., said in a text message.

As of Thursday, the food-to-infrastructure firm has a market capitalization of P118.93 billion, with its shares ending the day’s trading at P50.35 apiece, 0.70 percent up from the previous day’s close.

Cabarios noted that the investment is expected to go up as the years pass by, as the telecommunications industry is a fast-growing sector that requires players to annually modernize their networks.

He added that the new player is expected to share its spectrum—via Bell Telecommunications—with San Miguel’s small telcos. The food-to-infrastructure firm has been acquiring small telcos and have Eastern Telecommunications Philippines Inc., Liberty Telecoms Holdings Inc. and Express Telecommunications Inc. under its wings.

“Bell Telecoms has spectrum number 700 and is building a network together with wi-tribe. Just like the spectrums of Innovae and Globe, Smart and parent

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Philippine Long Distance Telephone Co. [PLDT], the San Miguel telcos can also share frequencies,” he said.

Cabarios explained that the sharing of frequencies—considered as active infrastructure—will help cut operating costs, thus, helping pull commercial prices down to the benefit of the consumers.

Over the last 10 years, PLDT and Globe have invested P300 billion each.

Market shakeup

“A JEC is not a prerequisite for an FTA, but is a building block toward it,” said another trade official, who declined to be named.

While the Philippines remains interested in an FTA with Canada, Domingo said both countries may have to reassess the timeline, given the North American country’s change in administration.

The trade department ealier said it will aggressively engage six countries in bilateral talks. The representatives of these countries have approached the agency for FTA talks during the Apec Ministers Responsible for Trade meeting in Boracay in May. The Philippines is particularly interested in forging bilateral trade ties with Mexico, Canada and Chile, since the three countries are currently included in the 12 negotiating members of the Trans-Pacific Partnership (TPP).

The TPP is a highly ambitious, expansive, and “modern” FTA among 12 countries representing 40 percent of global trade.

The Philippines has long stated its intention to join the TPP.

Tiu noted that the entry of the new core player will be bad for the business propositions of incumbents PLDT and Globe Telecom Inc., as competition in the current duopolistic market is expected to further heat up.

This early, Globe has doubled the data allocation of some of its postpaid subscribers, with consumers claiming that the company is being “threatened” by the buzz made by the AustralianFilipino duo.

“Market competition will be bad for both Globe and PLDT,” Tiu said. “We can expect slower growth and lower margins.”

Telstra is expected to bring its mighty Internet connection to the Philippines using 4G technology. It is expected that this initiative will help uplift the quality of the Internet in the country.

According to studies conducted by Ookla, an Internet-metrics provider, the Philippines has the second-slowest average download speed among 22 countries in Asia with an average speed of 3.64 Mbps.

It ranked 176th out of 202 nations around the world. It is eight times slower than the global average broadband download speed of 23.3 Mbps.

In a separate report, Cloud services provider Akamai Technologies said that while the Philippines might have improved its connection by a percentage point, its overall ranking in Asia still remains at number 13 out of 15, or the third-worst connection in the region.

Filipinos, according to the first-quarter report of Akamai, enjoyed an average download speed of 2.8 Mbps during the period under review. Trailing behind are India and Indonesia with 2.3 Mpbs and 2.2 Mbps average speed, respectively.