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A broader look at today’s business

n Wednesday, December 16, 2015 Vol. 11 No. 69

BSP MAINTAINS 5% REMITTANCE-GROWTH GOAL FOR 2015

P25.00 nationwide | 4 sections 20 pages | 7 days a week

Oct remittances rise below expectations

INSIDE

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serena williams

sports

A8

HOW A FED HIKE COULD HURT YOUR CREDIT-CARD DEBT

By Bianca Cuaresma

ash remittances—normally ramping up in October as overseas Filipinos prepare themselves for the long Christmas holidays back home—dipped lower this time around, reaching only $2.232 billion for a barely perceptible growth of just 0.2 percent, according to latest data from the Bangko Sentral ng Pilipinas (BSP). Continued on A2

‘Cash cab’

I

life

t’s the antiholiday gift: As consumers rack up credit-card charges on presents, vacations and dinners for the holidays, card issuers are poised to raise the annual percentage rate (APR) on their cards.

b2-2

green development

property

Card issuers are waiting to see if the Federal Reserve’s policy-setting committee bumps up the federal funds rate on Tuesday, as many expect. If it does, the hike will flow through to credit-card holders as soon as they receive their next bill.

That’s because the peg for most variable-rate consumer borrowing—whether credit cards, adjustable-rate mortgages, or home-equity lines of credit—is the prime rate.

And that rate moves with the federal funds rate. Prime is 3.25 percent today, and card issuers add a certain percent on top of it to set the APR.

A 0.25-percent increase in an APR is a nonissue for people who pay off balances. But for those who carry a balance month to month, it affects the entire balance, not just new

C1

EARLY BIRDS GET THE BEST DEALS Shoppers rush to a mall in

See “Credit Card,” A2

Quezon City as soon as it opened its doors on Tuesday to finish their shopping early and avoid getting stuck in heavy traffic during rush hour. Nonie Reyes

New Fitch upgrade hinges on continuity of reforms after polls A

nother upgrade from a major credit watcher is forthcoming in the next 12 to 18 months, provided the political landscape of the country ensures continuity of reforms set by the present administration.

In Fitch Ratings’s latest sovereign outlook on the region, the international credit watcher reiterated its confidence on the country’s macroeconomy as an outlier to the rest of emerging Asia.

In September this year Fitch hiked its outlook on the Philip-

pines’s rating to “positive,” from “stable.” The Philippines is the only country in the 11 nations in emerging Asia to get a positive outlook from Fitch.

A positive outlook means that a rating upgrade is possible in the next 12 to 18 months for the country.

While economic managers earlier reacted to the development as something that is “long overdue,” the credit watcher said in its most recent assessment note on the Philippines that turning the posi-

PESO exchange rates n US 47.3390

tive outlook into an actual credit rating is also dependent on the confidence of the markets on the country’s next head of state.

“Strong growth, a structural current-account surplus and ongoing fiscal-policy discipline are driving a steady improvement in the sovereign’s balance sheet.

Increased confidence that these trends will be sustained under the next administration after the 2016 presidential elections would support the case for an upgrade,” Fitch said.

The credit watcher also reiterated that the positive outlook given to the Philippines is driven by a steady strengthening in the country’s structural fundamentals, improvements captured in international measures of governance standards and international competitiveness; and reflected in the Philippines’s strong macroeconomic performance—mostly seen improving under the Aquino administration.

Meanwhile, in the region, Fitch said pressures against emerg-

ing markets in Asia due to a slew of developments—such as China’s slowdown, an expected rise in US rates, dollar strength, stillsluggish global trade growth and lower commodity prices—pose a challenging outlook for emerging Asian economies in 2016 to “varying degrees.”

Despite the rising risks to the region’s emerging markets, Fitch said the potential slowdown and impact of these are by far not reminiscent of the 1997 Asian financial crisis.

“Emerging Asian external balance sheets are generally stronger than in 1996, the year before the Asian financial crisis broke. Sovereigns are generally much less reliant on foreign-currency financing; and many countries now have more flexible exchange-rate regimes in place of the more prevalent use of explicit pegs before 1997. This gives authorities greater scope to let exchange rates act as a buffer today compared with the mid1990s,” Fitch said.

See “Fitch,” A2

n japan 0.3911 n UK 71.6760 n HK 6.1077 n CHINA 7.3290 n singapore 33.5952 n australia 34.2887 n EU 52.0066 n SAUDI arabia 12.6187 Source: BSP (14

December 2015)

A2 Wednesday, December 16, 2015

News

BusinessMirror

Maynilad, Manila Water rates to go down in Jan M

anila Water and Maynilad customers will pay less for their water bills from January to March 2016, the Metropolitan Waterworks and Sewerage System (MWSS) announced.

Manila Water will cut its rates by an average of 26 centavos per cubic meter.

For customers consuming 10 cubic meters or less a month, there will be a reduction of a little over a peso, while those consuming between 20 and 30 cubic meters will see a rate cut of about P3 to P6.

Maynilad, on the other hand,

will slash rates by an average of 19 centavos per cubic meter.

Factoring in other cost components, those using 10 cubic meters a month will pay 64 centavos less, while those consuming 20 to 30 cubic meters will see a reduction of P2 to P5.

The rate adjustment included the two companies’ tariff rates, which are adjusted annually; as well as the foreign-currency differential adjustment, which changes on a quarterly basis.

Although it seems like good news, it can be recalled that both

companies are seeking compensation from the government worth billions of pesos.

Maynilad is seeking payment amounting to about P3.5 billion, after regulators refused to honor an arbitration panel’s decision that the company can pass on its corporate income taxes to its customers.

On the other hand, Manila Water is asking P79 billion from the government as payment for prospective losses, after an arbitration panel ruled it cannot pass on its corporate income taxes to its customers. CNN Philippines

Fitch...

continued from A1

Also, the Philippines is said to be one of the countries in emerging Asia that has built the strongest walls to ward off the impact of potential crises in the region.

According to Fitch’s data, the country has strong external liquidity, moderate commodity exposure to risks, moderate trade openness and low private-sector leverage, making it one of the less exposed to the conjunction of risks according to Fitch’s factors.

The Philippines sits with Bangladesh and India as the least exposed to risks in the region.

Meanwhile, Indonesia, Malaysia and Mongolia stand out as the most exposed to the risk factors identified by Fitch. Bianca Cuaresma

Executive indicted in Otsuka-Maryland tussle

A

n executive of Otsuka (Phils.) Pharmaceutical Inc., the local unit of Japanese conglomerate Otsuka Pharmaceutical Co. Ltd., has been indicted for perjury, after allegedly making “falsehood” statements against Maryland Distributors Inc. (MDI), a Filipino-owned company.

MDI is the former exclusive distributor in the Philippines of Pocari Sweat, a health drink imported and supplied in the country

by Otsuka. MDI filed a perjury case against Jose Jacinto M. Aquino, associate finance director of Otsuka (Phils.) Pharmaceutical Inc., for claiming that MDI stopped paying for the goods delivered by Otsuka, and that it refused to cooperate and communicate with Otsuka for the settlement of MDI’s outstanding balance.

Aquino’s affidavit, made before the Regional Trial Court (RTC) in Makati City Branch 57, prompted the court to issue a writ of preliminary attachment against the

assets of MDI in May this year.

Assistant City Prosecutor Edna Conde said “the sweeping statements of respondent [Aquino] in his affidavits, which include the said falsities, undoubtedly created an impression before the trial court that Maryland deceitfully avoided its obligation with Otsuka.”

“We find that probable cause exists to warrant the indictment of respondent for the offense complained of. Records bear out that the subject statements of respondents in his affidavits were evidently falsehood and made deliberately to obtain a writ of preliminary attachment from the trial court,” the City Prosecutor said. “Thus, demands for Maryland to settle its outstanding obligation did not fall on deaf ears, and there was no unreasonable refusal on its part to settle its obligations.”

Conde recommended that Aquino be indicted for the crime of perjury, with a bail of P6,000. Her recommendation was supported

by Deputy City Prosecutor Edgardo Hirang and approved by City Prosecutor Jorge G. Catalan Jr. on December 8, 2015.

Otsuka signed an exclusive distribution agreement with Maryland on May 28, 2012, for the distribution of Pocari Sweat for two years—covering the period January 16, 2012, to January 15, 2015—subject to renewal. After the lapse of the agreement, the deal was not renewed, with Otsuka appointing another distributor.

Otsuka, in the process of winding up its respective obligations under the agreement, claimed that MDI had outstanding payables, a claim that was strongly opposed by MDI. Otsuka then filed a case before the RTC in Makati City to collect from MDI, where Aquino executed a judicial affidavit claiming that MDI stopped paying for the goods after the agreement had expired; that MDI ignored all requests of Otsuka; and that MDI refused to cooperate or even communicate with Otsuka.

In response, MDI said it did not stop paying for the goods even after the agreement had expired, as evidenced by official receipts issued to Otsuka from October 28, 2013, to November 10, 2014.

MDI said it also did not ignore Otsuka’s request for the list of trade claims and it had been in constant communication with Otsuka, as evidenced by the exchange of e-mails on record.

The City Prosecutor, however, said it appeared that Aquino very well knew that MDI did not stop paying for the goods delivered, even after the expiration of the agreement; that MDI did not ignore its requests for submission of trade receivables; and that MDI did not refuse to cooperate and communicate with Otsuka.

The City Prosecutor said to exculpate himself from criminal liability for perjury, Aquino found the need to qualify and later rectify his subject statements in his counteraffidavit.

news@businessmirror.com.ph

October remittances rise below expectations continued from A1

Cash remittances a year earlier amounted to $2.228 billion.

This development contrasted sharply against more ebulient expectations by experts and government officials looking forward to a more cheerful period as the Christmas season nears.

Historically, cash-remittance growth was fastest in the last three months of the year. This time around, the 0.2-percent October growth rate proved the second lowest monthly growth rate thus far this year. In August the BSP reported a contraction averaging 0.6 percent for the period.

The remittance inflows brought the cumulative cash remittances in the first 10 months to $20.64 billion. This was 3.7 percent more than cash remittances accumulated in the same period last year.

Despite this, the cash-remittance growth proved lower than forecast remittance growth of 5 percent for 2015.

Still, the monetary authorities remained confident the remittance flows should continue to pour in volumes allowing the $285-billion economy to post continued local expansion measured as the GDP.

Forecast continued expansion in remittances was based in part on the continued deployment of skilled manpower, as well as the

continued effort by banks and nonbank remittance service providers to expand their international and domestic market coverage through tie-ups abroad, as well as the introduction of innovations in their remittance products.

The BSP cited preliminary reports from the Philippine Overseas Employment Administration (POEA), indicating that for the period January to October 2015, total job orders reached 717,182, of which 44.1 percent have been processed.

The job orders were intended mainly for service, production, and professional, technical and related workers in Saudi Arabia, Kuwait, Qatar, Taiwan and Hong Kong.

Bulk of October’s remittance inflows, meanwhile, came from the United States, Saudi Arabia, the United Arab Emirates, Singapore, the United Kingdom, Japan, Canada and Hong Kong. Combined remittances from these countries accounted for more than 79 percent of total cash remittances that were reported by banks.

“The sustained slowdown in remittances may once again be tied to the movement of global currencies. The DXY, or the Dollar index, which shows the strength of the dollar against a basket of currency, was much higher in October 2015 (96.945) vs October 2014 (86.917). Thus, any remittance sent home by an overseas Filipino not denominated in US dollar will be watered down in dollar terms,” said Nicholas Antonio T. Mapa, research officer at the BPI Market Research and Strategy.

“This is something we need to be prepared for moving forward, as the Fed is the only central bank that is in any position to hike interest rates, with other major central banks needing to ease further to bolster their respective economies.”

Credit card... continued from A1

purchases. If this is the start of a series of rate hikes, it could make paying off a big balance take longer—and cost more. The Consumer Financial Protection Bureau estimates in a recent report that a quarter-point rise in the federalfunds rate would cost cardholders $1 billion annually, and a full percentage-point hike almost $6 billion.

The good news? In most cases, if you got a promotional rate on a balance transfer, that rate is fixed. So anyone who’s taken advantage of such offers wouldn’t see their transferred balance affected by rate increases until the promotional period ends.

If you’re carrying a big balance on a card with a double-digit APR, there are still plenty of offers out there to transfer balances at a zeropercentage rate, fixed, for a year or more. The average length for zeropercent offers is a year, although Citi has a 21-month offer, said Brian Riley, principal at research and advisory firm CEB TowerGroup.

The length of offers could shrink, or the fees could climb, if there’s a series of hikes in the federal funds rate. It will take more than a quarter-point rise to bring much change, though, said Odysseas Pap­di­mitriou, CEO of cardhub. com and wallethub.com. “I’d expect those zero percent fixed introductory rates to stay the same—unless the Fed goes aggressive and raises by 50 basis points,” he said. Bloomberg News

A4 Wednesday, December 16, 2015 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

A new approach to the housing problem

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cknowledged as socially pernicious, economically depressing and politically destabilizing, the housing problem in the Philippines seems to grow in breadth and depth every day. Despite populist pronouncements of concern by public officials, it has been the subject of benign neglect. That is why the announcement a few days ago by the House Committee on Housing and Urban Development that the government is initiating action to wipe out the 5.5 million housing backlog through the Public-Private Partnership (PPP) Program is most welcome.

The first step in this effort, according to the chairman of the House Committee, Rep. Alfredo Benitez of Negros Occidental, has already been taken by Malacañang—directing the concerned government agencies and government-owned and -controlled corporations to submit an inventory of their respective idle lands and identify the sites in these lands that can be used for socialized housing before the year ends. The next step will be the placement of the housing program through the PPP scheme for implementation.

As matters currently stand, the housing program can already be described as being implemented under the PPP scheme, with private developers doing the construction, then being compensated by the government for the cost of construction, and the government receiving rental payments from tenants. But implementation is not systematic and government-private developer relationship is anything but cordial.

At this point, it might be instructive to take a look at the experience of the city of Mumbai, India, in solving its housing and slum problem. Mumbai gave private developers the right to identify slum areas and develop these into first-class residential and commercial districts, so long as the developers obtained the consent of the affected poor families and provided them with new housing units, free of charge, in the rebuilt districts. The housing program is proceeding as planned, resulting in the housing of thousands of poor families, slum clearance, the building of new and modern shopping districts and the evolution of a new skyline. The program is not without problems, but the city government is dealing with them.

Can we adopt the Mumbai approach to our own housing problem? Why not? In this connection, our own Tondo district in the city of Manila comes to mind. As a PPP project, the reconstruction of Tondo will entail no expense to the government, will yield a proper return to investment to the developer, and give the poor families now living there new modern housing units and opportunities for the improvement of their lives. The government itself—city and national—will collect vastly increased taxes and related revenues.

In Mumbai, the rehoused poor families found opportunities in the commercial enterprises that came into existence and the richer families that bought units in the towers gave them employment as maintenance people, sales clerks, household staff, drivers and other workers.

The Mumbai program gives us the outline of a way of solving our housing problem, which might be superior to the projects we have been implementing so far.

The gift of SSS membership Susie G. Bugante

All About Social Security

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ine days to go before Christmas, the holiday season is indeed in full swing. Homes and buildings sparkle with colorful lights and dazzle with decorations, Christmas songs are played over the radio, and frenzied shoppers at malls and neighborhood bazaars hunt for the perfect gifts for their family, friends, officemates, batchmates, churchmates, neighbors…and the list goes on. Even the Social Security System’s (SSS) 13thmonth pensions have been disbursed to SSS partner banks for release to pensioners’ savings accounts, adding more cheer to the Yuletide season.

The choices of items for gift-giving can be dizzying. But as a friendly piece of advice, how about giving something more meaningful and long-lasting?

Under the SSS guidelines, stayat-home individuals married to actively paying SSS members, but have never been covered by the SSS, can be registered as nonworking spouses (NWS). As a Christmas present, active SSS members who find themselves in this situation can offer their spouse the gift of social-security protection. They can commit to ensure that part of their regular income would be allocated for the SSS contribution and active

SSS membership of their spouse.

NWS represent a unique segment of SSS membership. The rest of SSS members have been employed in some capacity in the past or are still working in the private sector, either as company or household employees, self-employed persons or overseas Filipino workers (OFWs). NWS have never been employed or self-employed, but they have remained similarly busy and productive by keeping the household in order, budgeting the family’s finances and taking care of the children, among others.

Housewives are common examples of NWS. They dedicate their lives

to attending to the diverse needs of their family, a noble duty that runs well beyond the typical eight-hour working day, with no vacation leaves at that. Their male counterparts, the stay-at-home dads, can also be common nowadays, given the significant number of Filipino mothers going overseas as domestic workers, leaving their husbands in charge of household matters.

The amount of SSS contributions of NWS depend on the monthly salary credit (MSC) of their working husband or wife. Per SSS policy, their contributions are computed based on half of the working spouses’ MSC. To illustrate this, assume that Pedro, a tricycle driver, remits regular contributions through the AlkanSSSya Program based on the P3,000 MSC, which has an equivalent monthly contribution of P330.

Maria, his wife, can remit P165 for her monthly contribution as a NWS as computed from the P1,500 MSC. NWS who regularly pay their contributions can become entitled to short-term and lifetime benefits for SSS-covered contingencies, such as maternity, sickness, disability, retirement and death.

It is important to note that current stay-at-home spouses who already have posted the SSS contributions during their previous employment or self-employment are no longer covered by the NWS category.

Propaganda won’t pay for Alibaba Adam Minter

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BLOOMBERG VIEW

ate Friday night, Alibaba’s Jack Ma joined Amazon’s Jeff Bezos as the latest tech billionaire to acquire his own newspaper, by purchasing Hong Kong’s South China Morning Post (SCMP) for $266 million. The paper is the semiautonomous city-state’s most influential English-language news outlet, as well as a longtime thorn in the side of the Chinese regime. That would appear to pose a problem for Alibaba, which thrives in part because of its good relations with the government.

Executive Vice President Joseph Tsai claims to see opportunity instead.

“When people don’t really understand China and have the wrong perception of China, they also have a lot of misconceptions about Alibaba,” he explained to the New York Times. So in theory, if the SCMP now presents a rosier picture of China and the Chinese economy, Alibaba’s business should benefit, as well.

“What’s good for China is also good for Alibaba,” Tsai insisted.

That’s a fairly convoluted rationalization for a multimillion-dollar acquisition. And it’s unconvincing for one simple reason: The market for neutered coverage of China is exceedingly small and is becoming smaller. If Ma is really serious about revising perceptions of

China and his company, then he’s going to have to have the confidence to present the country in all its aspects, good and bad.

Needless to say, China doesn’t lack for progovernment newspapers. From the earliest days of Communist Party rule, control of the media was a key lever of state power. Newspapers established internal Communist Party committees; to this day they receive regular guidance from national and local propaganda bureaus. In a pre-Internet age, this might have worked to shape perceptions within China. But the development of the Web and especially social media has dramatically weakened the government’s ability to channel the flow of information. Even today, under one of the world’s most

stringent online censorship programs, China’s hundreds of millions of netizens have become adept at seeking out sources of independent information.

In years past, the government simply forced citizens to subscribe to Communist Party newspapers and hoped that—lacking other reading material—they might embrace the Party line. Occasionally, officials still employ that strategy. In 2012, for example, one Chinese city required local brothels to subscribe to a bundle of Party newspapers.

Regular Chinese aren’t the only ones who’ve grown tired of state-devised propaganda: China’s 90 million Communist Party members seem equally fed up. Back in November, People’s Daily, the official newspaper of the Communist Party, grew so alarmed by the falloff in interest in milquetoast China coverage that it ran a soul-searching editorial titled, “Is it OK for Party Members not to Read Party Newspapers?” The piece wistfully observed the propensity of young cadres to spend their nights surfing Internet gossip sites rather than studying the latest directives from Beijing.

Meanwhile, despite the increasing professionalization of top-end Chinese media, there’s even less appetite abroad for filtered coverage of China. Stateowned China Daily, the self-described “voice of China,” publishes daily and weekly English-language print editions in China, the US, Europe, Asia and Hong Kong. Yet, according to a company web

If they want to continue paying their SSS contributions, they would instead be considered as “separated members,” meaning those separated from private-sector employment. As separated members, they can choose the MSC that would be the basis of their SSS contributions.

While the number of registered NWS continue to expand, showing a growth of 10 percent within the first nine months of this year, the overall total remains conservative, with slightly over 3,000 NWS members at present.

To register as a NWS, the person must fill out and submit the SSS Personal Record (E-1) form, duly signed by the working spouse, along with a copy of the marriage certificate and supporting documents for SSS number issuance, such as birth or baptismal certificate. Those who already have an SSS number should file the NWS Record (NW-1 Form) using the same SSS number.

For more information about the Social Security System (SSS) and its programs, call its 24-hour call center at (632) 920-6446 to 55, Monday to Friday, or send an e-mail to member_ relations@sss.gov.ph.

Susie G. Bugante is the vice president for public affairs and special events of the SSS. Send comments about this column to susiebugante.bmirror@ gmail.com.

site, only a third of its daily circulation of 200,000 comes from overseas. International interest is so low that the paper famously pays other media organizations to carry the print edition as a supplement or—in the case of the Wall Street Journal—as a special online advertising section.

How far Alibaba will go to change the SCMP’s editorial focus remains to be seen, of course. The paper is currently censored online in China. If it wants access to mainland readers, it’s going to have to accept the same low standard for coverage as China Daily and its brethren do. At that point, the SCMP would have little comparative advantage over its mainland rivals, who are likely to dominate the few scoops the regime sees fit to dispense. And, in the meantime, foreign readers who count on the paper for insight into China are almost certain to abandon the paper in droves.

The better option would be for Ma to offer the paper’s editors and writers the resources and freedom to pursue the China story wherever it leads—and to count on mainland readers to continue to find a way to access its stories.

Such an approach would inevitably lead to some uncomfortable moments between Ma and Party officials. But the benefits of defying expectations and showing that both China and one of its most high-profile companies are open to a freer press would be enduring and profitable. For Ma, a noted risk-taker, it’s a bet worth taking.

Opinion BusinessMirror

opinion@businessmirror.com.ph

AEC: A milestone for Asean’s economic development

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It’s back to slavery, morons

By Jayant Rikhye

o the list of emerging Asia’s economic powerhouses, add one more: Southeast Asia and its 625 million inhabitants.

Spanning countries as diverse as Vietnam, Indonesia, the Philippines and Singapore, the Association of Southeast Asian Nations (Asean) is often considered an “also-ran” that gets far less attention than China and India.

To underestimate the region, however, would be a mistake.

Asean is already an economic force to be reckoned with: The GDP of its 10 members now totals more than $2.5 trillion— about 25 percent more than India’s, and not far short of the United Kingdom’s.

If Asean were one economy, and current growth trends continue, it could be the world’s fourth-largest economy by 2050.

Its population is roughly double that of the United States. Its economies have attracted investments from corporate giants around the globe, and are deeply embedded in the world’s trade and supply chains. Asean economies attracted a combined $136 billion in foreign direct investment last year, topping China’s $128 billion.

As we head into 2016, Asean’s economic cohesion will receive an extra boost, and render the region’s potential more visible to the outside world.

Just weeks from now, on December 31 the Asean Economic Community (AEC) will be formally established, marking a milestone in the group’s long path toward a single coherent market. The AEC is aimed at liberalizing the flow of goods, services, capital and, ultimately, skilled labor within the region in a bid to raise its competitiveness and facilitate investment into infrastructure.

The AEC builds on decades of incremental work done since Asean’s inception in 1967. Free trade in goods, for example, has already been effectively established. But more needs to be done to remove the many obstacles (exclusion lists and nontariff barriers, such as language or safety requirements) that still hamper the flow in services, for example, and to reduce cross-border financial transaction costs.

If fully implemented, the extra steps envisaged under the AEC could raise Asean’s GDP by 5 percent by 2030—a welcome boost at a time when the fall in raw materials prices is generating pain in parts of the region, and overall growth has cooled. While there are years of work ahead to complete the integration envisaged by the AEC, the stars are aligned for a promising long-term growth story, thanks to a trio of factors.

First, the region is increasingly attractive as a manufacturing location. China— long the “factory floor of the world”—is shifting its economic model toward more value-added, higher-tech manufacturing and services. This means more of the traditional, labor-intensive manufacturing, that was once based in China,

is moving to Asean nations. Meanwhile, Southeast Asia’s demographics mean an ample supply of affordable labor. China, by contrast, has become more expensive as wages have risen.

Asean is already a key manufacturing hub, notably for the electronics and automotive sectors. Toyota manufactures more than 700,000 vehicles a year in Thailand and another 400,000 at its sites in Indonesia, for example. BASF, the German chemicals company, has six production and operation sites in Malaysia alone. General Electric has more than 60 locations and employs 7,600 people across Asean. The Philippines has become a major hub for information technology and business-process outsourcing.

More overseas investment is likely to follow as remaining hurdles to trade and investment are lowered.

Second, consumer-spending power is growing rapidly. Asean’s population numbers less than half that of either China or India, but 15 years from now, the region will have added another 120 million inhabitants—the equivalent of one-and-a-half Germanys.

What is more, Southeast Asians are becoming more affluent. In 2010 per-capita GDP was just $3,000. Asean members aim to raise this to more than $9,000 by 2030. The increased spending power is turning the region into an increasingly key market for anything, from cars and airplane tickets, to shampoo and mobile phones.

Third, Asean is home to an established and trusted international financial center in Singapore. Increasing financial liberalization could help lower transaction costs and facilitate investment flows into Asean, aiding economies like Singapore, Malaysia and Thailand, in particular. Other countries, such as Indonesia and the Philippines, could benefit most from increased investments into much-needed infrastructure, which is currently still a weak spot in Asean’s overall growth story.

Economically, the countries of Southeast Asia face near-term headwinds, like many others around the world. But the region’s economic assets, combined with extra lubricant from the AEC efforts, will make it ever more important as a location to manufacture in, source from and sell to. To ignore it would be a mistake.

Teddy Locsin Jr.

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Free fire

HE Paris climate summit ended with the empty promise to allow no more than a 2-degree increase in global warming.

The planet is already 1-degree hotter than when a few white people went around on horseback, while most people went about on their feet because they were dark. The advent of massive industrialization ended most human slavery as the principal means of wealth creation.

Human slavery continues, of course, but only to serve human sexuality. This is shown by the vast numbers of young girls and boys under 10 forced to sexually service hundreds of millions of sex-starved, underpaid workmen so they don’t prey on rich little boys and girls.

The advent of coal- and oil-driven industry put an end to whipping the skins off the backs of black people. It worked perfectly. There is a new book about not knowing the other half of the benefits of American slavery.

The more you lashed, the more they made—cotton, in the case of the US.

By Leonid Bershidsky | Bloomberg View

he ubiquitous corruption and lack of accountability in Vladimir Putin’s Russia were, until recently, easy to sweep under the rug. But the relentless decline in oil prices is making the president’s political bets unsafe. Now the country’s problems are beginning to fester in plain view, giving the regime a tough choice: start liberalizing or go for harsh repression.

The case of Prosecutor General Yuri Chaika will be a weather vane of what’s to come. He was justice minister when Putin became president in 2000, running, among other things, Russia’s vast prison system. In 2006 Putin made him prosecutor general. Apart from prosecuting cases on the state’s behalf, the prosecutor general’s office exercises control over all criminal investigations and coordinates the activities of all law-enforcement bodies, making the prosecutor general one of the country’s most influential people.

On December 1 a nonprofit group, led by anticorruption activist Alexei Navalny, published the results of a yearlong investigation into the business affairs of Chaika’s two sons. Even to hardened Russians, the revelations were shocking.

The ex-wife of Chaika’s deputy, Gennady Lopatin, was linked to various ventures both with the prosecutor general’s older son, Artem, and with the wives of members of a notorious mob that terrorized part of southern Russia for years. Apart from connecting some of the most notorious criminals in modern Russia with Chaika’s family

A5

But the result was overproduction and the necessity of finding mass markets for it. Hence, the end of slavery and the appearance of wage labor to buy up the goods made. The individually meager but collectively huge earnings of, say, overseas Filipino workers fuel the consumption-led economies of the poor countries from which they fled.

Cut back on industrial activity to reduce global warming and we reduce our children, which is to say all our posterity, to slavery. We cannot expect the rich and powerful of the world to stop heating up the Earth and start losing money, no more than we can expect poor people to stop eating rather than submit to slavery again.

This is proved by the only candid experiment in sustained alternative energy, identified by William Styron in an essay. He wrote that the Nazi death camps were less about mass

killing and more of a demonstration of how much productivity it is possible to extract from human labor, with near zero investment in food and shelter.

The inmates of Nazi death camps were worked purposely to death with little, if any, food and sleep. The rate of production and fatality were carefully recorded to arrive at the optimal rate of human productivity at the longest and cheapest rate of feeding and shelter.

That is what will happen when carbon emissions are reduced significantly. Some things never change. We, including our children and their children, will be again the machinery of the future. Don’t believe in robotics. People are still cheaper and smarter. For such is the nature of power, which will do what it must just because it can. So said the Greek Thucydides when his city enslaved another.

ruble and shrinking government reserves, Putin has sought to transfer blame to treacherous foreigners who are trying to undermine Russia. It worked in 2014 when Russia annexed Crimea in response to what Putin called a US-backed coup in Ukraine. It worked this year, too, as Russia entered Syria, ostensibly to fight Islamic State, and as Putin quarreled with his Turkish counterpart, Recep Tayyip Erdogan, over a downed warplane.

Putin cannot be sure, however, that the anti-Western rhetoric of Fortress Russia will still work with oil worth $35 per barrel—or, God forbid, even less. The finance ministry’s worst-case scenario for 2016 is $40 oil. The central bank has tried to imagine $35—and said it would lead to a 3-percent economic decline, a fiscal deficit of 5-percent GDP and the exhaustion of the government’s reserve fund by the end of the year. On Monday Brent traded at $37 per barrel.

With oil unlikely to rebound soon, Putin cannot count on lulling Russians into passivity by using propaganda alone. He clearly fears that his enemies’ activity will increase and become more efficient. In late 2013 Putin pardoned Mikhail Khodorkovsky, a former oil tycoon who had been his most resourceful political opponent. Last week Khodorkovsky was charged in absentia as an accomplice to murder—possibly to make sure he couldn’t return to Russia from his exile in Switzerland.

Putin faces a harsh dilemma. He

could try to make Russia more competitive by carefully retreating in Ukraine, getting Western sanctions lifted, and liberalizing the domestic economic climate. That would mean dismantling the backbone of his regime: the obedient law-enforcement system, run on his behalf by people, like Chaika, loyal but unpopular because of their ruthlessness and greed.

That would improve the economy but undermine his power. Or Putin could drop the remaining pretense of democracy and rule openly by force, ordering mass reprisals against opponents both real and imagined.

The system Putin has created is pushing him toward the second option. The parliament is considering legislation that would make the “discreditation of the Russian Federation” a crime. The Federal Migration Service has drafted a bill that would bar foreigners who favor the regime’s overthrow from entering Russia. ProPutin officials and legislators have even been discussing the reintroduction of Soviet-style exit visas.

The unlikely liberalization option would require Putin to fire Chaika.

If the prosecutor stays on, despite being unable to refute any of the allegations against him, it will be a clear sign that Putin is either going for the dictatorship scenario —further tightening the screws next year—or hoping to muddle through by doing nothing, a strategy that won’t help him much if oil keeps getting cheaper.

Jayant Rikhye is head of International, Asia Pacific and head of Strategy and Planning, Asia Pacific, The Hongkong and Shanghai Banking Corp. Ltd.

Watch what Putin does to his top prosecutor

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Wednesday, December 16, 2015

and underlings, Navalny’s investigation contained well-researched episodes involving alleged illegal takeovers of businesses in favor of Artem Chaika, aided by local prosecutors. The elder Chaika was shown to have omitted a palatial home near Moscow from his property declaration.

A 44-minute movie of the investigation has been viewed 3.4 million times on YouTube. Yet, official comments on the findings were off-key to the point of being ridiculous.

Putin’s press secretary, Dmitri Peskov, said the investigation “did not talk about the prosecutor general, only about his adult sons who are in business on their own,” though the entire point of the investigation was to show how Chaika’s connections and the entire system under his direction allegedly aided his sons’ enterprises. When asked about the Chaika case, Prime Minister Dmitri Medvedev mumbled in a televised interview: “As for all kinds of publications, you know yourself how they emerge and in what way, and they are not always the results of objective investigations and

the result of the objective activity by certain persons. They are very often made to order. I won’t give an assessment to specific publications, simply so as not to advertise them, and that’s precisely the goal this publication is after. Moreover, this is always part of a political struggle.”

He added that the law-enforcement system was supposed to thoroughly check all corruption allegations, but that can hardly be taken seriously: Yuri Chaika is, of course, in charge of coordinating the country’s law enforcement.

Chaika, himself, declared the investigation a hatchet job. On Monday the daily Kommersant published his lengthy letter to the editor, making accusations against William Browder, a US-born British subject who was once a wealthy investor in Moscow but is now persona non grata in Russia.

Browder claims his business in Russia was stolen by Russian bureaucrats and law enforcers. Sergei Magnitsky, an auditor who worked for Browder and was jailed allegedly for investigating misdeeds, died in prison in 2009, and Browder has been waging a campaign to pin the death on Putin and his system ever since. The US Congress in 2012 passed the so-called Magnitsky Act, imposing travel bans and asset freezes on Russian officials allegedly involved in the case.

“I have no doubt that W. Browder and the intelligence services that back him are behind this slanderous film,” Chaika wrote. “There is a global goal—to

compromise the Russian prosecutor general and the regional officials subordinate to him, to present our country as a bad business partner, a country worthy of economic and other sanctions.”

Browder told me he had never worked with Navalny on any project.

On Monday he issued a news release saying he had been “very impressed with the investigation” but that he hadn’t cooperated with it in any way.

“After watching this movie, it’s clear that prosecutor Chaika has serious and grave allegations to answer to,” the release read. “It’s simply not credible for him to say that he can ignore them because a foreigner who is regarded as Putin’s No. 1 enemy was supposedly behind them.” Besides possibly overestimating his own importance to Putin, Browder is probably wrong on the credibility issue: The “foreign intelligence services” connection was the last trump card the Kremlin could play in response to Navalny’s charges.

During the carefree years of Russia’s oil wealth, when a barrel of Brent crude fetched more than $100, Peskov’s flippant denial or Medvedev’s clumsy hint that Navalny was just trying to further his political career might have sufficed.

Back then, Russians knew the ruling elite was corrupt, but they didn’t care much: They were themselves doing better than ever before, and who was to say Putin’s political opponents weren’t just as venal?

In the last two years, as oil dropped to $55 to $60 per barrel and the illusion of wealth melted with the devaluing

A6 Wednesday, December 16, 2015 • Editor: Vittorio V. Vitug

News

BusinessMirror

Firm files graft charges against DOTC, MRT 3 executives over alleged nonpayment of rail-maintenance services

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By Lorenz S. Marasigan

he contractor for the six-month maintenance of the rolling stocks of the Metro Rail Transit (MRT) Line 3 has filed graft charges against executives of the Department of Transportation and Communications (DOTC) for the government’s alleged nonpayment of the services rendered

by Schunk Bahn-und Industrietechnik GmbHComm Builders & Technology Phils. Corp. Joint Venture (Schunk-CBT JV).

“The DOTC and MRT are refusing to pay us our due billing payments, so we are having a hard time meeting our payroll, which is making it easier for Busan to hire away our people. At the same time, the DOTC had accepted only the offer or bid of the Busan-Hanwa-Edison consortium and rejected our offer to undertake the P4.3-billion MRT rehab and maintenance for three years, despite us having the experienced and skilled people to do the job,” company’s lead representative Roehl Bacar said.

The graft charges were filed on Friday before the Office of the Deputy Ombudsman for Luzon against MRT General Manager Roman Buenafe; Transportation Undersecretary Edwin Lopez, head of the DOTC procurement unit; MRT Engineering Division Chief Misael Narca; MRT Rolling Stock principal engineer Arturo Din; and MRT signaling systems principal engineer Daniel Barrera over the nonpayment for their maintenance services.

In his 12-page graft complaint, Ba-

car said the respondents had no just reason to withhold payment of the scheduled billings of their joint venture, saying that they had been rendering satisfactory maintenance services for the efficient operations of the MRT 3 and the reduction in rail-line operations stoppages since they had assumed maintenance on July 5.

The JV was awarded the short-term maintenance contract for the rolling stock and signaling systems of the MRT 3 for six months in May, and formally assumed maintenance over the rolling stock and signaling systems on July 5.

Bacar said his company had made “some upgrades and modifications regarding the scope of work in maintaining the rolling stock and signaling systems from the terms of the contract to ensure the minimum number of required number of running trains during revenue operations hours, avoid incidents of rail stoppages and derailments, and to safeguard the safety of MRT passengers.”

He stressed that all the upgrades

and modifications had been approved by the DOTC and the MRT 3 officials.

However, the DOTC and the MRT officials had caused the withholding of payments, with the delinquency reaching up to P118 million.

Bacar said his group was “obviously being singled out by the DOTC and the MRT among the MRT 3 suppliers for nonpayment of services despite their satisfactory services.”

“This clearly manifest partiality, which caused undue injury to the complainant, by cutting off the payment due it and necessary to sustain its execution of the contract. This, likewise, imperils the safety of the riding public,” he pointed out.

Bacar also decried the “raid” being done on his staff of highly skilled, experienced rail engineers and technical people by their rival bidder for the P4.3-billion, three-year MRT 3 maintenance contract.

He lamented that the cash crunch was happening this Yuletide season, when they wanted to issue performance and Christmas bonuses for their people, who “were doing a good job for the Schunk-CBT JV, enabling it to efficiently run the MRT trains and signaling systems since July with fewer stoppages and incidents, considering the record-high ridership being seen in the past few months at the MRT.” “Although we want to give out much deserved performance and bonuses this Christmas season, we can’t because we are not being paid by the DOTC and the MRT 3,” Bacar said. “So far, our people have expressed their loyalty to us, so they want to stay with us as much as possible. But they also have families to support and feed.”

LP fund-raising drive

Amid calls for a Palace review of

the over P3-billion DOTC contract for additional Metro Rail trains, Ma lacañang said Transpor tation Secretary Joseph Emilio A. Abaya has debunked speculations he is using his DOTC post to raise campaign funds for Liberal Party bets, led by Aquino administration standardbearer Manuel A. Roxas II. Malacañang referred questions on the deal to the DOTC but kept mum when asked it would revisit the questioned transaction, a P3.85-billion contract with China’s Dalian Locomotive and Rolling Stock Corp. which critics say is only for engineless trains that have not been test-run.

Reports added that the government must now spend an extra P2-billion to buy the motors for the recently acquired MRT 3 trains, apart from talks that Abaya—as LP president—may be using DOTC for party fundraising for LP bets.

After verifying with DOTC, Secretary Herminio B. Coloma Jr. conveyed Abaya’s denial of the allegations to Palace reporters.

“The contract for the new 48 LRVs provides for complete operational trains.

No one in his right mind will buy train bodies only, then have the engines procured separately,” Coloma said quoting Abaya’s statement.

Abaya added: “What an incredible idea.

In fact just to demonstrate, a second LRV arrives just before Christmas and that is a complete unit and people will see it on the rails for test runs. It has done some test runs in Dalian and completion of test runs will be done here.”

The DOTC Secretary also dismissed as “totally false” reports that the trains have yet to be procured.”

At the same time, Abaya flatly denied reports linking him to fundraising activities of the ruling LP. With Butch Fernandez

news@businessmirror.com.ph

Marcos tells Bacoor voters: Choose LGU-friendly bets

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en. and vice MARCOS: “The presidentia l work of the LGUs candidate Feris crucial to the dinand R. Marcos Jr. growth of a vibrant on Monday told resieconomy for our dents of Bacoor City towns and cities, in Cavite to choose a the foundation of new set of national the economy of the leaders next year, entire country.” who will give appropriate importance to local government units (LGUs) and tap them as partners not only in the delivery of basic services, but also in nation-building.

In his message after the flag-raising ceremony at the City Hall of Bacoor, Marcos said many LGU officials are complaining that they are given little or no role at all in bigticket projects of the national government implemented in their areas of jurisdiction.

“In the past few years, many LGU officials have complained that the national government seemed to take the attitude that it alone is capable of the task of delivering services to our citizens,” said Marcos, also the chairman of the Senate Committee on Local Government.

Such attitude of the national government is plainly wrong, according to Marcos, who was a three-term governor of Ilocos Norte.

He noted that local officials are the ones who know best the needs of their locality and people.

Marcos reiterated that many LGU officials are intelligent, hard-working and sincere in their desire to improve the lot of their constituents.

Marcos cited the example of Bacoor City, which experienced rapid development under the leadership of Mayor Strike Revilla. “ The work of the LGUs is crucial to the growth of a vibrant economy for our towns and cities, the foundation of the economy of the entire country,” Marcos assessed.

“If you choose the right candidates, I believe that in the next administration, we will witness a significant shift in the national government’s attitude toward the LGUs, and we will see, as well, a marked improvement in the relationship between the local and national government,” he told the audience.

mirror_sports@yahoo.com.ph | sports@businessmirror.com.ph

Sports BusinessMirror

Wednesday, December 16, 2015 A7

Perpetual Help big boss heads Altas coaching staff

MAKATI IN SEMIS

M ROGEN LADON receives an award from the Asian Boxing Confederation.

Pinoy boxers honored

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ATIONAL boxers Rogen Ladon and Criz Sander Laurente will receive the continental federation for boxing award from the Asian Boxing Confederation (ASBC).

ASBC Executive Director Bagdaulet Turekhanov announced the good news in an e-mail from the ASBC headquarters in Almaty, Kazakhstan, to the Association of Boxing Alliances in the Philippines (Abap).

Ladon,22, of Bago City, Negros Occidental, clinched silver in the Asian Championships in Bangkok and a bronze medal in the World Championships in Doha, Qatar, earlier this year.

Laurente,15, one of two boxing brothers from General Santos City, settled for a silver in the Asian Junior Boxing Championships in Tashkent, Uzbekistan, in June.

Abap President Ricky Vargas congratulated the two boxers and the coaching staff, as he exhorted the national boxers to always “strive for excellence for flag and country.”

AKATI City overpowered Santa Rosa, Laguna, with its exceptional batting, fashioning out a 15-0 romp to clinch the first semifinal berth in the 2015 National Inter-Secondary Girls Softball Championships at the Barangka Baseball Field in Marikina City on Tuesday.

Not even the downpour spawned by Typhoon Nona could slow down the Makati girls, who needed just four innings to dispose of their Santa Rosa rivals, courtesy of solid hitting from Angelu Gabriel, Charlotte Sales and Tin Bautista, who came through with two home runs each.

Remeli Herrero spiked Makati’s win with a grand

slam on her first try at bat in the second inning.

“I had them adjust their batting technique yesterday [Monday] since I wanted them to straighten their arms to get better chances of a home run. So, this morning [yesterday], I had them do just that and they were able to deliver,” said Makati City Coach Yolly Sanchez, who steered her wards to their sixth straight victory in Bracket A for a spot in the next round of the weeklong tournament, sponsored by the Amateur Softball Association of the Philippines (Asaphil) and Cebuana Lhuillier for the country’s current aces and rising stars.

“We’re just in the middle of the tournament and we’re already seeing great potential from this year’s contenders. I’m glad that we have such a platform to showcase the potential of these young Filipino athletes. They certainly deserve all the support they can get,” Asaphil president and Cebuana Lhuillier President and CEO Jean Henri Lhuillier said.

Cabiao, Nueva Ecija, meanwhile, rebounded from a pair of shutout losses with a 7-0 victory over Baguio City, while Manila City also posted a 7-0 rout of Tuguegarao at the Santo Niño Baseball Field, also in Marikina City.

ROMEO’ST HOT ERRENCE ROMEO’S back-to-back explosive performances against Meralco and a tough Mahindra side earned him his first AccelPhilippine Basketball Association (PBA) Press Corps Player of the Week award in the 41st season.

The 5-foot-10 GlobalPort guard showed why he’s one of the pro league’s fast-rising superstars, after outdueling veteran Meralco guard Jimmy Alapag in the Batang Pier’s pulse-pounding 108104 win over the Bolts on December 9.

Last season’s Most Improved Player was at his absolute best in the final period, banging 12 of his season-high 33 points to preserve

Suarez clinches 16-under crown

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OP-seed Justin Suarez of PTA Manila bounced back from a second-set meltdown with a tough win in the tiebreaker, hacking out a 6-2, 2-6, 10-7 victory over unranked Nilo Ledama to clinch the boys’ 16-and-under crown in the Palawan PawnshopPalawan Express Pera Padala regional age group tennis tournament at the Naga City Tennis Club (NCTC) in Cebu on Tuesday.

Young Tiffany Claire Nocos also lived up to her billing but went through a pair of wringers to win the 10-unisex and girls’ 12-U title in the weeklong Group 2 tournament, sponsored

by Palawan Pawnshop and held as part of the Dagitab Festival celebrations capped by an Open Championship which gets going on Wednesday.

Nocos, from Lapu Lapu City, thwarted No. 2 Alain Ocat, 3-5, 5-4(3), 12-10, to snare the 10-unisex crown then repulsed second seed Lyra Mae Repollo, 6-1, 3-6, 10-7, in the 12-U finals of the event presented by Technifibre.

“We thank Palawan Pawnshop for staging this tournament, which drew the top young players from various cities and towns of the region. We also invite tennis aficionados to watch the national men’s players in the Open Championship,” Mayor Valdemar Chiong of the NCTC said.

Local ace Zethley Alferez took the girls’ 18-U title with a 6-1, 6-2 reversal over top seed Kristin Salimbangon, but Carcar, Cebu’s Elizabeth Abarquez foiled Alferez’s two-title bid by taking the 16-U plum with a 6-1, 6-3 shocker.

Abarquez later downed Wyne Paglinawan, 6-1, 6-4, to pocket the 14-under plum while Norman Enriquez of Pardo, Cebu whipped Wyndell Deja, 6-0, 6-2, for the boys’ 18-under diadem, and Ledama, from Pagadian City, recovered from a loss to Suarez by copping the 14-under crown with a 6-3, 6-0 win over Kier Nacua.

Second seed Lance Raven Hitosis of Puerto Princesa dominated the full-packed boys’ 12-U side, beating No. 7 Kenenth Tenepre, 6-1, 6-3, to join the winners of the event capping the yearlong, nationwide age-group circuit.

GlobalPort’s victory and spoil Alapag’s lastquarter explosion.

Four days later, Romeo bucked a woeful shooting night from beyond the arc, knocking down his lone three-point shot in the game, before icing the contest with a lay-up off a crossover move to tow GlobalPort past Mahindra in overtime, 118-116.

The win pushed GlobalPort to solo fourth spot with a 7-3 win-loss record and secure a twice-tobeat advantage in the quarterfinal stage.

The former Far Eastern University star averaged 31 points, 6.5 rebounds and 4.0 assists in the Batang Pier’s 2-0 record last week to beat teammate Stanley Pringle, San Miguel Beer’s Alex Cabagnot, Blackwater’s Carlo Lastimosa and Barangay Ginebra’s Scottie Thompson for the weekly citation.

Romeo’s game has no doubt improved this season following his two-month stint with Gilas Pilipinas, which placed second in the 2015 International Basketball Federation-Asia men’s championships in Changsa, China, last September.

GlobalPort looks to extend its franchisebest fourth straight win on Friday when it faces Talk ‘N Text in the opening game at the Smart Araneta Coliseum.

SAN MIGUEL VS ALASKA

NBA RESULTS

SAN Miguel Beer Head Coach Leo Austria knows their current record, league-best

at 9-1, does not guarantee them an automatic semifinals slot.

That’s why he wants his Beermen to be mentally tough when they face Alaska in the main game on Wednesday at the Smart Araneta Coliseum.

San Miguel is one win short of the top two spots and the defending champions want to clinch it in their 7 p.m. encounter with the Aces, who are also in the hunt for an automatic semifinals berths along with Rain or Shine.

Alaska and Rain or Shine are tied at No. 2 with 7-2 win-loss slate each, with the Elasto Painters facing the already eliminated Meralco (1-9) in the opener at 4:15 p.m.

The Beermen enter the crucial match with a momentum, having won their last seven games, including a 97-84 victory over Talk ‘N Text.

“We are not in the semis yet. We still need to win our game against Alaska,” said Austria, who has been getting quality minutes from his second and third stringers in the absence of a couple of key Marcio Lassiter and Gabby Espinas.

“Going to the game, we need to match their [Aces] intensity because it is also a must win for them. A loss for them, they will be eliminated in the top two,” he added.

Joel Orellana

Indiana 106, Toronto 90 Orlando 105, Brooklyn 82 LA Clippers 105, Detroit 103, OT Chicago 115, Philadelphia 96 Memphis 112, Washington 95 Miami 100, Atlanta 88 San Antonio 118, Utah 81 Dallas 104, Phoenix 94 Denver 114, Houston 108

TERRENCE ROMEO has been churning in big numbers for the Batang Pier. PBA IMAGE

Portland 105, New Orleans 101

BATTLE ROYALE LOOMS IN PHL OPEN IN TARLAC

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XPECT a battle royale as the men of the tour seek solid finishes in the 98th Philippine Open, which fires on Thursday at the Luisita Golf and Country Club in Tarlac.

The players will be jostling for spots in the Top 63 in the Order of Merit (OOM) to earn a full Asian Tour card for 2016. Among the players fighting to break into the cut-off line are Thai Chinnarat Phadungsil, young Phachara Khongwatmai, also of Thailand, Scott Barr of Australia, Japanese Akinori Tani, Sam Cyr of the US and Korean Giwhan Kim. Three Filipinos are inside the safety zone, but Miguel Tabuena (44th), Angelo Que (52nd) and

Al Mendoza alsol47@yahoo.com

THAT’S ALL

Unlocking the Austria System SAN Miguel Beer (SMB) is definitely favored on Wednesday against Alaska, even as the 7 p.m. encounter is expected to be thrill-laden at the Smart Araneta Coliseum.

The contest is close to a toss-up, really, as both teams are equipped with high-powered material on all fronts—from point guards to power forwards to slot men.

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ERPETUAL Help University owner Antonio Tamayo heads a three-man coaching staff that will handle the Altas following the exit of veteran Aric del Rosario as head coach.

Joining Tamayo, according to Perpetual Help Athletic Director Jeff Tamayo, are lawyer Barry Neil Tobias and former player Nic Omorogbe.

“They will start preparation as soon as possible,” Jeff Tamayo said on Tuesday.

Antonio Tamayo was Del Rosario’s teammate at University of Santo Tomas’s juniors team. Tobias, on the other hand, studied college at De La Salle and finished Law at Perpetual Help, while Omorogbe played for the Altas whom he helped reached the Final Four in 2012 and 2013.

The recent appointment left Letran as the only remaining school without a head coach. Aldin Ayo left to coach for De La Salle.

Perpetual Help, meanwhile, smashed Jose Rizal University, 25-16, 25-20, 25-19, to seize the solo lead from reigning titlist Emilio Aguinaldo College (EAC) in men’s volleyball action at The Arena in San Juan City on Tuesday.

Team captain Bonjomar Castel had 12 points and Rey Taneo Jr. contributed 11 hits for the Altas, who nailed their fifth straight victory.

EAC blew its chance of regaining solo first after losing to Lyceum of the Philippines, 23-25, 25-14, 22-25, 25-18, 14-16.

So that, should the Aces of Coach Alex Compton pull this one out of the chestnuts roasting in an open fire, I would not be surprised.

The one thing good about Alaska is that it has an adroit coach in Compton, whose handling of the one-time Grand Slam crew has been a serious source of strength that the Americanmarried-to-a-Filipina merited a sweet spot in the

Tony Lascuña (56th) will also be going all-out not only to improve their respective ranking but regain the championship for the Filipinos.

Que last won the Open, as an Asian Tour event, in 2008 at Wack Wack, with Elmer Salvador and Artemio Murakami ruling the next two editions in all-Filipino Open.

American Berry Henson nipped Jay Bayron to snare the 2011 crown, Singapore’s Mardan Mamat dominated the field the next year and Marcus Both winning by two last year. There was no Philippine Open in 2013.

A total of two Asian Tour OOM winners, including local ace and Japan-based Juvic

coaching staff of Gilas the national team.

Alaska’s mark of 7-2 puts it in a position of power, giving the Aces extra inspiration to win today and stay close to SMB and, hopefully, peel from a two-way tie for second with Rain or Shine (RoS).

Ah, the Elasto Painters.

Always figuring on top of the leader board in virtually all conferences, Rain or Shine seems headed to another unimpeded march to victory.

Seemingly always in-form, RoS is almost a shoo-in for an eighth victory today in 10 games when it takes on Meralco, which is in the league as a mere spoiler now with an ousted win-loss mark of 1-9.

Ah, the Bolts.

The fate that had befallen them in the ongoing Philippine Basketball Association (PBA) Philippine Cup has become a puzzle as complex as the foundling, floundering, case of presidential bet Grace Poe. How Meralco could be so buried deep

Pagunsan, and no fewer than 15 Tour winners will slug it out for top honors in the seasonending $300,000 event, Asia’s oldest national Open which used to be the kickoff leg of the Asian Tour.

Six players in the Top 20 of the current Asian Tour OOM are also among the 132-man elite field, while Jeunghun Wang of Korea, who will represent Team Asia in next year’s EurAsia Cup, is also in the fold.

“I think this is our best chance to reclaim the crown,” said Lascuña, out to cap the season with a win after yielding the local OOM title he held for three years to Tabuena.

down the cellar defies imagination, if not logic, especially in light that its coach, Norman Black, is held in high esteem for his enviable records of being a PBA Grand Slam champ with SMB in 1989 and a “five-peat” champion coach of Ateneo.

Why Black’s stock has dipped this low is like seeing the sinking of the Titanic: Unthinkable.

Anyway, back to SMB. The 9-1 Beermen of Coach Leo Austria have been lording it over because of a system that has proven to be as impregnable as the Viet Cong Tunnel in the Vietnam War of the 1960s.

It is this miles and miles of undetected Tunnel that tremendously tilted the war in favor of Ho Chi Min’s revolutionary Vietnamese forces, leading to a ruthless rout of the Americans in an insulting, utterly ugly defeat of the US. And, like Ho Chi Min, Austria sticks to his guns like no other, will die or live with a formula that he stubbornly believes is foolproof, though the heavens fall.

It is an Austria System so simple yet lethal

Two-day beach volley tourney up this weekend »

BEA TAN (second from left) expounds on the two-day tournament. With Tan are (from left) Rupia Inck, Charo Soriano and Alexa Micek. ALYSA SALEN

most of the time; fittingly, it has already won for SMB the last three of the five PBA titles staked—including the present conference.

Thus, the question: Can Compton coax his Aces today to stop SMB’s surge, and become only the second squad to inflict the Beermen’s second loss after RoS? Place your bets, fellas. Mine is lunch of bagnet pakbet: SMB.

THAT’S IT A good send-off for year 2015 has been assured when Nonito Donaire Jr. won the WBO super-bantamweight crown on Friday (Saturday in the Philippines) in a brutal 12-round unanimous decision win over tough Mexican Cesar Juarez in San Juan, Puerto Rico.

The win was doubly special in light of Donaire’s somewhat shaky finish, weathering Juarez’s jarring blows in the middle rounds with equally telling counter-punches in the homestretch and an enormous Filipino pride that proved solid enough to survive what Ted Failon said was another “impeding Donaire meltdown.”

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EN teams are vying in the Beach Volleyball Republic Christmas Open scheduled on Saturday and Sunday at the SM Sands by the Bay. The tournament features some of the country’s finest players competing for a total cash prize of P100,000.

“It’s our way of thanking the people who supported beach volleyball this year. It’s a good mix of players from the UAAP [University Athletic Association of the Phlippines], V-League, SuperLiga and the NCAA [National Collegiate Athletic Association], as well,” said Bea Tan, one of the players seeing action in the event, which was featured in Tuesday’s session of the Philippine Sportswriters Association Forum at Shakey’s Malate.

Tan was accompanied in the public sports program presented by San Miguel Corp., Accel, Shakey’s and the Philippine Amusement and Gaming Corp. by fellow players Alexa Micek, Charo Soriano, Rupia Inck and technical official Adrian Tabanag.

The teams are Tan and Inck, Soriano and Micek, Fille Cainglet and Denden Lazaro, April Hingpit and Maica Morada, Julie Ann Tiangco and Mariel Sinamban.

Also seeing action are Rica Rivera and Cherry Rondina, Janine Marciano and Bang Pineda, April Romero and Rose Cailing, Judy Caballejo and Camille Abanto, and Arielle Estranero and Vina Alinas.

The 10 teams are bracketed into two groups, which plays a round-robin elimination on Saturday starting at 8 a.m.

The top 2 teams in each group willadvance in the crossover semifinals, with the winners playing for the title.

The semifinals and finals will be played on Sunday.

Sports BusinessMirror

A8 | W

ednesday, December 16, 2015 mirror_sports@yahoo.com.ph sports@businessmirror.com.ph Editor: Jun Lomibao

FUTURE

AT STAKE

OLYMPIANS SEEK URGENT SOLUTION

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Fifa prioritizing human-rights issues in every aspect of its operations—from competitions to day-to-day contracts—appears to be a response to concerns about worker rights in Qatar in the five years since the Gulf nation won the right to stage the 2022 World Cup.

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By Rob Harris

The Associated Press

ONDON—International Football Federation (Fifa) has tasked a Harvard professor with formulating humanrights requirements for World Cup hosts and sponsors of the scandaltarnished governing body.

John Ruggie will provide a report in March showing how business and human-rights principles he conceived for the United Nations can speedily become part of Fifa’s statues.

“I hope everyone at Fifa is taking these issues seriously because the future of Fifa is at stake,” Ruggie told the Associated Press.

“I suspect given the pressure Fifa is under they should look to it as a helpful tool and get on with it.”

Following Ruggie’s review, such requirements will be an integral condition for countries entering bidding for the 2026 World Cup, with the process yet to be launched.

Fifa prioritizing human-rights issues in every aspect of its operations—from competitions to day-to-day contracts— appears to be a response to concerns about worker rights in Qatar in the five years since the Gulf nation won the right to stage the 2022 World Cup. “If the guiding principles had been in place in the context of the [2022] Fifa bidding requirements, the requirements themselves would have looked very different,” Ruggie said in response to questions about Qatar.

“We are not asking Fifa to solve every global human-rights problem, but what the recommendations will require is that they become aware of the human-rights impact of their own activities, relationships and events, and they have adequate procedures in place to avoid those adverse consequences.”

Qatar organizers say no workers have died during 14 million man hours on stadium projects, which have more stringent regulations than the country’s own laws. The scrutiny of Qatar has centered on non-World Cup projects, with the government yet to approve much-talked about labor reforms.

“These reforms may not be coming quick enough for some people but our focus is on sustainable change,” 2022 World Cup organizing head Hassan Al Thawadi said on Monday on the supreme committee’s web site.

If Ruggie’s envisaged proposals to Fifa had been in place at the time of the 2022 World Cup vote, Qatar would have been mandated to commit then to overhauling its labor laws.

“A host country would have had two choices: either not to bid or agree to the conditions in which the bid was reviewed and accepted,” Ruggie said.

SACKED Houston Texans quarterback

Brian Hoyer (7) loses the ball as he is sacked by New England Patriots defensive end Jabaal Sheard (93) during the second half of their National Football League game over the weekend. AP

Ruggie’s rules will not just cover construction workers at stadiums but also, for example, security forces protecting World Cup venues, ensuring they are adequately trained in the use of firearms and crowd control while controlling demonstrations without violence.

A source of anger in Brazil ahead of the 2014 World Cup was over the displacing of communities to build stadiums, which is unacceptable to Ruggie without the agreement of locals.

“There are international rules that go along with needing to adequately consult and compensate communities,” Ruggie said. “You don’t just send in the bulldozers to raze homes to the ground so you can build a stadium.”

The new regulations will also cover the working practices of Fifa sponsors. Adidas, for example, would have to prove that its workers operate in good conditions and are adequately paid to make World Cup balls.

“For many years, the adidas Group has been committed to ensuring fair labor practices, fair wages and safe working conditions in factories throughout our global supply chain,” the German sportswear giant said in a statement.

Ruggie said it is important for Fifa to “conduct adequate due diligence to make sure that none of the activities that they themselves, control or are, otherwise, involved in infringe upon the human rights of individuals or harm communities that they impact.”

After initially being approached in August by now-suspended Fifa President Sepp Blatter, Ruggie has spent the last four months in talks with the governing body to ensure he had editorial control of the final report.

“That was the most difficult issue,” Ruggie said. “They wanted certain powers of review... but ultimate editorial control remains with me and Harvard.”

SPORTS ILLUSTRATED honors Serena Williams.

ALYSA SALEN

Sportsperson of the Year N

EW YORK—Serena Williams is Sports Illustrated’s (SI) Sportsperson of the Year—the first female athlete honored on her own by the magazine in more than 30 years.

Williams came within two matches of tennis’ first calendaryear Grand Slam since 1988, a bid that ended with a semifinal loss at the US Open.

In all, the 34-year-old American went 53-3 during 2015 with five titles, including at the Australian Open, French Open and Wimbledon. Williams was No. 1 in the Women’s Tennis

Association rankings all season.

“She was the most deserving person for the award. She had an amazing year. The way she won her events; the fact that she’s done this for so many years at such a high level,” said Paul Fichtenbaum, editor of the Sports Illustrated Group.

“She was a terrific candidate in a year of terrific candidates.”

The cover photo of Williams—in high heels, sitting on a throne—was “her idea, intended...to express her own ideal of femininity, strength, power,” Managing Editor Christian Stone wrote on SI.com.

Monday’s announcement marks a switch to the formal name of the SI award; past recipients were touted as Sportsman or Sportswoman of the Year.

“We just felt this was a natural evolution.... We’re not making a huge deal out of it,” Fichtenbaum said. “It just feels like the right time to make the change.”

Runner Mary Decker in 1983 was the last female athlete to earn the magazine’s award by herself.

The US women’s national soccer team was picked

by SI in 1999; speedskater Bonnie Blair in 1994 and gymnast Mary Lou Retton in 1984 were cohonorees with male Olympians. In 2011 Tennessee women’s basketball Coach Pat Summitt shared the award with Duke men’s Coach Mike Krzyzewski.

“Men’s sports has dominated until recently, when women’s sports has grown in popularity, and the competition is better than ever,” Fichtenbaum said. “There’s more of a focus on women’s sports now. It’s grown considerably. Specifically why?

I’m not sure.”

Other tennis players honored

by SI were Arthur Ashe in 1992, Chris Evert in 1976 and Billie Jean King in 1972. AP

ONACO—The global association of Olympic athletes says it’s unfair that all Russia’s track and field athletes have been banned from international competition because of allegations of statesponsored doping.

The World Olympians Association (WOA) calls for an “urgent solution” that allows athletes who have not been involved in doping to be able to compete.

The WOA issued a statement on Monday saying clean athletes should “have their rights and their reputations protected and honored.”

Russia’s athletics federation was suspended by the International Association of Athletics Federations (IAAF) following a report by a World Anti-Doping Agency panel that detailed widespread doping. The sanction could keep Russian track and field athletes out of next year’s Olympics in Rio de Janeiro.

The WOA suggests that athletes from suspended countries who have clean doping records could undergo “extraordinary testing sessions” clearing them to compete.

The WOA has ties to Russia through its patron, Prince Albert of Monaco, who has vacationed in the past with Russian President Vladimir Putin. WOA President Joel Bouzou is an adviser to Prince Albert and received a Russian state medal in 2012.

Two groups, meanwhile, competing for the lucrative contract to build the new stadium for the 2020 Tokyo Olympics have disclosed their design proposals.

The Japan Sports Council released the designs on Monday and said the winner will be chosen this month. It did not identify which companies have proposed which designs.

The two designs are more understated than the original plan by British-Iraqi architect Zaha Hadid, which was scrapped due to controversy over its cost and scale.

“We will work to ensure a stadium that will be loved by all,” Kazumi Daito, president of the Sports Council, said in announcing the plans, which he said would put “athletes first” and also emphasize accessibility for the disabled, elderly and children.

Work on the ¥158 billion ($1.3 billion) stadium intended to accommodate up to 80,000 people was delayed by the difficulties over its design, which proved a major embarrassment for local Olympics organizers.

Design “A’’ has a relatively flat roof and fits in with surrounding greenery, with shrubbery along its outer concourses. The combined steel and wood structure seems to echo traditional temple designs, and stands only 50 meters (164 feet) tall, with a center sports ground sunk below the surface.

Its construction cost is listed at a total of ¥153 billion ($1.26 billion).

The 54.3-meter-tall (178 feet) Design “B’’ is more ethereal, with outer glass walls that blend with the sky and are meant to reflect the traditional Asian concepts of the Five Elements of wood, fire, earth, metal and water. It would cost ¥153.7 billion ($1.26 billion).

Both plans call for construction to be done, apart from landscaping and surrounding work,

by November 30, 2019.

The stadium will replace the razed National Stadium, which was built in the late 1950s and hosted the 1964 Olympics. AP