Businessmirror april 10, 2016

BMReports What Filipinos should know about this thing called ‘QR’ By Jasper Emmanuel Y. Arcalas

@jearcalas

Part One

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REE trade does not equate to fair trade. In an ideal free-trade environment, the lone restricting barrier to exchange of goods should only be tariffs, or custom duties. But, before today, countries have imposed measures that have been counterproductive to trade. See related story on A10. These barriers were called as nontariff measures (NTMs) or nontariff barriers (NTBs). According to the World Trade Organization (WTO), these measures include ambiguous import licensing systems, stringent sanitary regulations, import prohibitions and import quotas. The most common form of NTM applied by countries to protect its local market is import quotas, or technically called quantitative restrictions (QR). The WTO defines QR as “ limits imposed on the volume or value of

This April 8 photo shows a farmer as he prepares his rice field for second cropping at the foot of Mount Arayat in Pampanga. While many agricultural commodities were included as the global trade was further liberalized, rice persisted to retain its market protection. NONIE REYES Continued on A2

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Monday, April 10, 2017 Vol. 12 No. 180

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By Lenie Lectura

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he Philippines needs 43,000 megawatts (MW) of additional power-generation capacity until 2040, with the bulk to be supplied in Luzon, according to the Department of Energy (DOE).

In a briefing paper on the Electric Power Industry presented before the Philippine Norway Business Council last week, the DOE said the required power system capacity addition from 2016 to

‘PHL FACTORY OUTPUT GROWTH LIKELY SLOWED IN FEBRUARY’ By Bianca Cuaresma @BcuaresmaBM

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ndustr i al pro duc t ion , keenly watched because it closely approximates business cycles, among other uses, may have slowed in February, said Moody’s Analytics, the research arm of the sovereign credit watcher Moody’s Investors Service. But the likelihood of more buoyant industrial production in subsequent months ramps up as both domestic and global demand continues to gain traction, the Moody’s unit said. In analyzing data across Asia Pacific, Moody’s Analytics plotted the closely watched industrial production index in the Philippines as having expanded to only 8.7 percent in February. The index expanded by 9.3 percent in January. Latest data from the Philippine Statistics Authority

The domestic economy continues to drive the rapid increases in manufacturing output.”—Moody’s Analytics (PSA) is set for release tomorrow, April 11. Despite the anticipated slowdown, Moody’s Analytics expressed optimism the country’s industrial production should prove robust in the coming months. “The domestic economy continues to drive the rapid increases in manufacturing output, as infrastructure projects and rising incomes support demand,” Moody’s Analytics said. See “Factory output,” A2

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2040 is 43,765 MW. The DOE said Luzon would need 24,385 MW, the Visayas 9,180 MW and Mindanao 10,200 MW. On a per-technology basis, the country would need 25,265 MW of

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base-load power that can be sourced from coal, geothermal natural gas, nuclear, biomass and hydro for the said period. The additional midmerit power sources that usually come from natural gas, among others, should hit 14,500 MW for the 24-year period. Peaking sources of power, such as oil, wind and solar, should total 4,000 MW. As of end2016, the country’s available capacity stood at 14,996 MW. Last year peak demand hit 13,272 MW. Continued on A2

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PHL needs to hike power supply by 43,000 MW–DOE

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hould a handful of experts, lawyers and consultants have monopoly over knowledge about public-private partnerships (PPPs)? What constitutes the PPP learning ecology? Why is learning critical for success of the PPP program and projects? We are all stakeholders. Parties to a PPP arrangement—a government agencies and private proponents—are not the only stakeholders of PPPs. We are all stakeholders. “We” here means the whole government bureaucracy, regulatory agencies, courts, legislators, civil-society organizations, church, academe, taxpayers, consumers and ordinary citizens. Whatever the government does, fails to do or improperly does affect all of us. Continued on A15

Lawmaker seeks LGU support for DOT A v ice chair man of the House Committee on Local Government on Sunday urged local government units (LGUs) to help the Department of Tourism (DOT) identify “tourism gaps” between market expectations and what tourist destinations can offer to visitors. Nacionalista Party Rep. Luis Raymund F. Villafuerte Jr. of Camarines Sur said in a statement that local chief executives should help the DOT find tourism gaps in their respective communities as a way to support the administration’s agenda for genuine economic inclusion. “Domestic tourism will let regions unleash their economic potentials and, thus, help them gird up for the planned switch to the federal form of government, where they would have a greater say on how they should chart their respective economic growth paths, and use the revenues they generate to fund their development programs,” Villafuerte said.

According to the lawmaker, local elective officials play a critical role in developing and ensuring the success of a sustainable tourism industry, as they are directly responsible for the management of the tourist destinations and resources in their respective areas of jurisdiction. “On top of identifying tourism gaps” in their respective localities, LGU executives can also coordinate with the DOT in developing an expanded tourism database that would include information about a community’s tourist spot, the type of visitors they attract, what tourists do, the length of their stay and how much they spend,” Villafuerte said. The DOT is setting up a database on the country’s tourist destinations. The lawmaker said the plan is in line with the DOT’s program to customize tourism-promotion strategies by coming up with “themebased offerings”, such as fitness, fun, family, farm and faith tourism. “The database could also include

VILLAFUERTE: “Domestic tourism will let regions unleash their economic potentials and, thus, help them gird up for the planned switch to the federal form of government, where they would have a greater say on how they should chart their respective economic growth paths, and use the revenues they generate to fund their development programs.”

the number of hotels in a certain locality, occupancy rates and the different forms of paid accommodation available,” Villafuerte added. Moreover, Vil lafuerte said LGUs can partner with the DOT in developing their tourist spots into extreme sports and ecotourism destinations, which attract more arrivals and repeat visits from both local and foreign tourists. Villafuerte cited Camarines Sur as example for what he calls

“success” of the tourism sector. “Our strategy was a resounding success because sports hubs tend to get a high number of repeat visitors who have to stay weeks ahead before a sports event to adjust themselves to the weather in the area and train there,” said Villafuerte, a former Camarines Sur governor. “They also return to the place to improve their skills. Not only that, they also come with their relatives and friends in tow.” Citing the United Nations World Tourism Organization (UNWTO), Villafuerte said sports tourism is a $600-billion market that is expected to expand by an average of 5.3 percent annually. Villafuerte added sports tourism is projected to grow 6.1 percent from 2013 to 2020, and by 4.7 percent from 2020 to 2030. He said UNWTO tourism projections show that arrivals in the Asia-Pacific region is expected to more than double, from 204 million arrivals in 2010 to 541 million by 2030. Jovee Marie N. dela Cruz

n japan 0.4528 n UK 62.5808 n HK 6.4579 n CHINA 7.2736 n singapore 35.7842 n australia 37.8555 n EU 53.4192 n SAUDI arabia 13.3798

Source: BSP (7 April 2017 )

A2 Monday, April 10, 2017

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What Filipinos should know about this thing called ‘QR’ Continued from A1

goods traded by a WTO member.” The Organisation for Economic Co-operation and Development (OECD) defines QR as “specific limits on the quantity or value of goods that can be imported [or exported] during a specific time period.” The Philippines was not different from the countries that imposed QRs on its goods, particularly agricultural commodities. “At the time, by the 1980s, in the middle of the martial-law regime, any commodity you can think of were subjected to QR— garlic, corn, all kinds of vegetable, cigarettes and sugar were all under QR,” Economist Dr. V. Bruce J. Tolentino of the International Rice Research Institute (IRRI) said. “You cannot import them without a license from the government, which will determine how much you could import.” Between the years 1980 and 1994, most of the agricultural commodities were eventually liberalized, leading to the scrapping of their QRs due to the development of global free trade market. One commodity persisted to retain its market protection: rice.

Free trade

THE General Agreement on Tariffs and Trade (Gatt) was signed by leaders of 23 nations in October 30, 1947, who sought to regulate international trade by reducing

barriers through reduction of tariffs, quotas and subsidies. The founding member-countries of Gatt were Australia, Belgium, Brazil, Burma, Canada, Ceylon, Chile, China, Cuba, Czechoslovakia, France, India, Lebanon, Luxembourg, the Netherlands, New Zealand, Norway, Pakistan, Southern Rhodesia, Syria, South Africa, the United Kingdom and the the United States. By 1982, the total number of Gatt member-countries would exceed more than a hundred. By that year, member-countries were alarmed by trade issues revolving around nontariff barriers— particularly the implementation of import quotas—and giving subsidies to produce agricultural goods. The issue on NTBs gave birth to the eighth Gatt round, known as the “Uruguary Round”, in September 1986. The culmination of the Urugay Round, which was panned for at least eight years, resulted in the signing of the Marrakesh Agreement in April 1994. The signing by more than 120 nations, including the Philippines, of the Marrakesh Agreement paved the way for the creation of the WTO, which replaced the GATT in 1995. The Marrakesh Agreement resulted in series of deals, including the agreement on agriculture (AoA). The AoA intensified the implementing measures in the trade of agricultural goods among WTO member-countries. In es-

sence, the AoA also led to the general elimination of QRs among membercountries as mandated by Gatt.

Elimination of QR

UNDER Article XI of the GATT, all forms of quantitative restrictions must be eliminated by WTO member-countries. “No prohibitions or restrictions other than duties, taxes or other charges, whether made effective through quotas, import or export licenses or other measures, shall be instituted or maintained by any contracting party on the importation of any product of the territory of any other contracting party or on the exportation or sale for export of any product destined for the territory of any other contracting party,” Article XI of the Gatt read. Meanwhile, Article 4.2 of the AoA mandates that all members of the WTO “shall not maintain, resort to, or revert to any measures of the kind which have been required to be converted into ordinary customs duties” except for defined circumstances. The conversion of a nontariff barrier into tariffs is commonly known as “tariffication”, the WTO said. Being the inventor of the word, the WTO defines tariffication as replacing agriculture-specific nontariff measures with a tariff rate equivalent, which afforded an equivalent level of protection. In terms of tariffs, member-

countries are mandated to set their “bound” tariffs or bindings to the WTO, which corresponds to the maximum level of tariffs that a certain member-country could impose. Upon its creation in 1995, the WTO has also required its members to reduce tariff of respective countries over the following years. “On the market access side, the Uruguay Round resulted in a key systemic change: the switch from a situation where a myriad of nontariff measures impeded agricultural trade flows to a regime of bound tariff-only protection plus reduction commitments,” the WTO said.

Philippines accession

WHEN the Philippines acceded to the WTO by signing the Marrakesh agreement, it subjected its agricultural commodities to liberalization. This meant the Philippines should convert all its NTBs into tariff rate equivalents. “The Philippines acceded to the WTO in the belief that its membership [in] the rules-based body would bring about economic benefits, primarily to the rural sector, through increased efficiency of industries required by exposure to global competition,” Economist Donah Sharon Baracol wrote in her case study for the WTO of the Philippines’s agricultural policy formation. “Jobs were promised and new

i ndu st r ies were e x pec ted to emerge.” However, before the Uruguay Final Accord was signed at Marrakesh in 1994, the Philippines secured approval to instead avail itself of the special treatment annex in the AoA, according to economist Ramon L. Clarete. The Philippines availed the special treatment clause to protect the local rice industry from cheaper rice imports from other Southeast Asian countries, such as Vietnam and Thailand. The Philippines succeeded in invoking Annex 5 of AoA, securing a 10-year special treatment on rice, allowing Manila to keep its QR on rice until 2005. Complying to the provisions of the AoA, Manila instituted the minimum access volume (MAV) scheme in rice imports. “Under a MAV scheme, a relatively low tariff rate was imposed on imported sensitive agricultural products up to a minimum import level [the so-called in-quota tariff rate], while a higher tariff rate was levied beyond the minimum import level [the so-called out-quota tariff rate],” the WTO said. The Philippines’s accession to WTO was ratified through Republic Act 8178, or the Agricultural Tariffication Act. The law mandates the conversion to tariffs of all QRs on agricultural commodities except for rice. Since then, the Philippine government has eyed to achieve rice

PHL needs to hike power supply by 43,000 MW–DOE Continued from A1

Of the country’s dependable capacity last year, 36.5 percent is coal; natural gas, 17.2 percent; hydro, 16.7 percent; oil-based, 14.8 percent; geothermal, 8.8 percent; solar, 3.1 percent; wind, 2 percent; biomass, 0.8 percent. Luzon’s share from last year’s total dependable and available capacity stood at 13,600 MW and 10,484 MW, respectively. Coal still dominates the mix, with 36.5 percent of the grid’s dependable capacity. In the Visayas the total dependable capacity last year reached 2,813 MW.

Of which, 2,299 MW is available capacity. Again, the majority of the power source was sourced from coal, with 37.3 percent of the dependable mix. Mindanao’s dependable capacity last year stood at 2,684 MW. Of which, 35.7 percent is coal. Of the total capacity, total available capacity was recorded at 2,213 MW. The DOE, whose mandate is to ensure reliable and affordable power supply, cited many challenges in the power industry. These include the high cost of electricity, limited and unreliable transmission system, delayed and unpredictable permitting process, sporadic power

interruptions, electrification gaps in off-grid areas and ongoing market development in Mindanao. To address these challenges, the agency vowed to pursue various action plans. On top of its list is to increase supply and ensure affordable electricity cost, both for grid and offgrid areas, firm up available energy capacities that are technology neutral without sacrificing environmental standards, and focus on delivery of services through grid interconnectivity including off-grid area. To enforce these action plans, the DOE said there is a need to proclaim

energy projects as “projects of national significance”. The DOE must also develop a program for LNG (liquefied natural gas) infrastructure, as well as a Nuclear Energy Development program. There is plan to put up a coal mine mouth project with interisland connection consisting of three phases. The first phase is a 20-kilometer (km) project that would connect Antique and Mindoro. The second phase is another 20 km from Mindoro to Batangas. The last phase is a 62-km project from Antique to Panay. The DOE also cited an optimal fuel mix of 70-20-10 share of baseload, mid-merit and peaking.

self-sufficiency by exploring various programs to improve the rice sector’s competitiveness. These attempts range from distribution of high-yielding rice varieties, mechanization of rice sector, improvement of irrigation systems, construction of farm-to-market roads and establishment of postharvest facilities. Despite these, the government failed to achieve the ambitious ricesufficiency target. The consecutive failures in preparing the rice sector to become competitive to its Asean counterparts resulted in the extension of the Philippines’ right to QR before the WTO. Agriculture Undersecretar y Segfredo R. Serrano said the QR on rice serves as a protection against trade distorting measures imposed by foreign countries. Serrano explained that rice sectors of foreign countries, particularly those rice-exporting ones, such as Vietnam, are heavily subsidized by the government. “[The importance of QR] is that you are sealing your Filipino farmers from foreign competition,” Serrano told the BusinessMirror. Serrano, added that exposing farmers “to such heavily subsidized and supportive competition” would be disadvantageous. “Trade must be fair,” he said. “Trade is not just a game of exchange of goods and services—it also has an impact on livelihoods.” To be continued

MFM 2018. . .

Continued from A16

about sustainable gastronomy —an emerging concept that is timely as we face various challenges and constraints in the production of our food. Indeed, the discussions made us appreciate the value of taking care of the environment and preserving cultural traditions while ensuring that we are able to satisfy and fulfill the gastronomic needs of people.” She said MFM remains an important event for the country in its aim for a larger slice of the fast-growing $150-billion food tourism industry, citing a 2015 study by the World Food Travel Association. Beyond revenue for the country, “it is our desire to enhance the food that we are offering to significantly raise the quality of our tourists’ overall experience, and therefore, improve our competitiveness as a travel destination,” she emphasized. The DOT head believes in food as an important medium of expression of Filipino culture and traditions. “As we all know, gastronomy is a vessel of our social and economic history. Through their culinary experiences, our tourists are able to have more intimate engagements with our locals and learn from their stories and understand their culture.” The Duterte administration is targeting to increase foreign visitor arrivals to 12 million in 2022, from 5.9 million in 2016, and inbound visitor receipts to P922 billion in 2022, from P231.13 billion in 2016.

Factory output. . . Continued from A1

“Global conditions have also become more supportive of manufacturing, as evidenced by the improvements in merchandise exports from the Philippines that began in 2017,” the think tank added. Moody’s optimism is fortified by the most recent purchasing managers index (PMI) indicating a rebound in the country’s manufacturing sector in March, after having slackened months earlier. In particular, the respected regional media organization Nikkei and international think tank IHS Markit said the Philippines’s PMI for March accelerated to 53.8, from the 53.6 in February. The PMI is a composite index where readings above 50 signal an improvement in business conditions while readings below 50 show a deterioration. It is calculated as the weighted average of five individual subcomponents. The components include new orders—which weigh the most at 30 percent of the index; output—at 25 percent of the index; employment—at 20 percent; suppliers’ delivery times—15 percent; and stocks of purchases—comprising the other 10 percent. The Philippines’s 53.8 PMI is above the Asean average of only 50.9 in March. It is also the second-highest PMI for the month in the region, next only to Vietnam, with a 54.6 PMI during the month.

Global gateway. . . Continued from A16

Manila, awards land developers and planners with tax credits and tax discounts for compliance with eco-friendly infrastructure design and construction standards under the Green Building Ordinance of 2009. While the Philippines still lags behind its Southeast Asian neighbors, such as Singapore and Thailand, in green initiatives, sustainability is now in the mind of developers when building new projects and retrofitting existing ones. “The rapid expansion of the green building industry globally sets the bar high for the local real-estate sector, and should ultimately encourage developers to keep up with the demand pressure for livable spaces as a result of increasing urbanization and the inflow of foreign businesses,” Williams said.

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Editor: Dionisio L. Pelayo • Monday, April 10, 2017 A3

Twin quakes prompt evacuation in Batangas

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By Robert Maico | Philippines News Agency

ATANGAS CITY—More than 5,000 people were taken to evacuation centers after a 5.6-magnitude earthquake jolted parts of Batangas at 3:07 p.m. on Saturday and was shortly followed by another 6-magnitude temblor. Georgina Garcia, information officer of the Office of Civil DefenseRegional Disaster Risk Reduction and Management Council (OCD-RDRRMC) in Calabarzon (Cavite, Laguna, Batangas, Rizal and Quezon) region, said consolidated reports indicate that at least 3,053 individuals were taken to 11 evacuation areas in the city, while at least 89 families in San Luis town, or 345 individuals from barangays Balite, Poblacion, Banoyo and Dulangan were also evacuated. In Mabini town more than 2,000 individuals camped in front of the town hall following the twin quakes. The report, Garcia said, also showed temporary evacuation of some families from the town of Agoncillo, San Pascual and Tingloy, while all general hospitals in the city of Lipa have evacuated their respective patients outside the hospitals. Taal Polymedic Hospital patients in the town of Taal also temporarily evacuated their patients and found cracks on the wall of the laboratory room. Garcia disclosed that one man was wounded by pieces of broken glass in his working area in a glass and aluminum shop in Mabini town, where the epicenter of the quake was traced.

Regional Director Olivia M. Luces said the OCD-RDRRMC has raised its alert status in all operation centers to ensure the proper monitoring, coordination and response to the affected areas and disseminated earthquake advisories since Saturday. OCD -R DR R MC has coordinated with the National Disaster Risk Reduction and Management Council (NDRRMC) and the Department of Social and Welfare Development (DSWD) National Resource Operations Center (NROC) for 50 tents and transportation in response to the requests from Batangas Council definition and Mabini town, Batangas City, for tents and for mobile kitchens. Also in response to the request for assistance, Laguna provincial disaster management office provided 70 tarpaulins and 30 sackolines as temporary shelters, while the local disaster management offices of Carmona, Alfonso and Tagaytay City in Cavite province provided Collapsed Structure Search and Rescue (CSSR) personnel and equipment augmentation to Mabini town. Meanwhile, the DSWD Calabarzon provided ready-to-eat food to the evacuees and patients under preemptive evacuation.

DPWH, South Luzon tollways operators prepare for Holy Week rush By Jonathan L. Mayuga

@jonlmayuga

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OFTWARE pirates are getting more and more creative to be able to sell their wares, especially with the more intense operations of the Pilipinas Anti-Piracy Team (PAPT). Instead of simply illegally copying discs of business software and operating systems, even unscrupulous merchants are also now mixing in pirated software along with the legitimate copies that they are selling. According to the National Bureau of Investigation (NBI), the copies are of very high quality and can easily deceive customers into thinking that they are buying legitimate software. “The customers are basically paying for the price of an original but receiving pirated copies in exchange,” operatives from the NBI noted. Late last year the NBI Intellectual Property Rights Division implemented a search warrant at Gaisano Interpace

Computer System, a computer parts and software retailer operated by Michael Sia at the Gilmore IT Center, a popular computer store hub. The raid seized 26 high-quality unlicensed copies of the Microsoft Windows 10 Professional operating system. The discs were marked “Made in Malaysia” and “Made in the United States”, but were found to be pirated upon authentication. The PAPT warned the public, especially businesses, to be vigilant and careful when dealing with computer stores that offer deals that are “too good to be true”. It is advisable to buy from authorized retailers of any of their chosen software or tech products. Microsoft Philippines is currently pursuing a case against Gaisano Interpace. Claudeth Mocon-Ciriaco

HE Department of Public Works and Highways (DPWH) has mobilized its Motorist Assistance Teams to aid motorists and commuters during the Lenten season. At the same time, South Luzon tollways operators vowed to make Holy Week vehicular traffic smoothly flowing and safe. Public Works Secretary Mark Villar said he has “directed all Regional and District Engineering Offices nationwide to reactivate the Lakbay-Alalay Program from April 10 to 17.” Uniformed motorist assistance teams will provide personal and prompt assistance on normal and emergency situations in strategic locations along major highways on a round-the-clock shift. They were ordered to coordinate with the Land Transportation Office, the National Police, local governments and other government agencies for any assistance that may be required. Prior to the Holy Week, the DPWH Maintenance Teams were deployed all over the country to ensure that national roads are well-maintained and free from potholes, have reflectorized pavement markings and have legible kilometer posts and directional signs. Roads with ongoing construction works were also checked to make sure proper warning signs are installed, especially those that lead to major public cemeteries. In the Bicol region, maintenance engineers were also instructed to install traffic advisories on alternate routes to bypass areas that have ongoing projects. DPWH Region 5 Director Danilo E. Versola reported that a total of 31 Motorist Assistance Centers will be set up along strategic areas of the national road in the Bicol region, consisting of 12 in the mainland provinces or from Albay,

Camarines Norte, Camarines Sur and Sorsogon; and 19 in the island provinces of Catanduanes and Masbate.

South tollways ready

HOLY Week traffic on the South Luzon tollways, meanwhile, is expected to increase 12 percent more than the usual daily average of 330,000 vehicles that run to and from places and provinces south of Metro Manila. The Skyway O&M Corp. (Somco), Manila Toll Expressway Systems Inc. (Mates) and Star Tollway Corp. (STC), operators of the SkywayNinoy Aquino International Airport Expressway (Naiax), South Luzon Expressway System (Slex) and Star Tollway, respectively, will exert added effort to keep traffic moving and motorists safe at all possible times. Southbound traffic on said toll roads will peak on April 12, 13 and 15 (Holy Wednesday, Maundy Thursday and Black Saturday) and northbound traffic on April 16 and 17 (Easter Sunday and Easter Monday) on return trip to Metro Manila. The South Luzon tollway operators will implement Oplan Ligtas Biyahe: Semana Santa 2017, in coordination with the National Police’s Highway Patrol Group, the Toll Regulatory Board, other concerned government agencies and local governments. At the Skyway System, southbound motorists are advised to use the elevated toll road instead of the at-grade Nichols and C-5 entry plazas where traffic volume is high. On the northbound direction, the Skyway Main, the old Naiax, C-5 Exit, Nichols and Sucat are, likewise traffic-heavy. At Slex, the southbound toll plazas with high traffic volume are Calamba Main, Greenfield-TR3, Santa Rosa, Eton and Carmona; while the NB toll plazas are Calamba Main, Greenfield-TR3 and Filinvest.

At Star Tollway, heavy but manageable traffic is expected at some toll plazas and stretches of the expressway. To ease the congestion on the SB Ibaan-San Jose toll exit caused by the increased traffic demand and the temporary closure of Sabang Bridge, exiting Class 1 vehicles (cars-jeeps) will use IbaanSan Jose NB exit and SB entry while Class 2 and Class 3 (buses and trucks) will take the regular SB toll exit. Motorists returning to Manila on April 16 and 17 are forewarned of heavy-traffic situation at major toll plazas, like Santo Tomas exit, Lipa-Tambo entry and the Ibaan-San Jose interchange. Adequate number of ambulant tellers will be posted round the clock on busy toll plazas to speed up toll payment transactions and help ease the flow of traffic. Additional on-call ambulant tellers will immediately be deployed where and when needed.

QC imposes tight security

QUEZON City Mayor Herbert Bautista has placed on alert all police, traffic, rescue and barangay personnel to ensure the orderly and peaceful observance of the Holy Week in the city. Bautista’s directive calls for heightened police visibility in all bus terminals and other passenger-holding areas in the city, including terminals of the Metro Rail Transit (MRT), to deter criminal activities and other lawless acts. To secure bus terminals and MRT stations, the Quezon City Police District was ordered to set up police assistance centers and conduct round the clock foot, mobile and motorcycle patrols. Bautista also ordered the deployment of patrol cars at residential areas and in places holding “cenaculo and “pabasa.” The Mayor said the 50 patrol cars acquired recently by the city government for the QCPD can be used for this purpose.

Expert: E-cigarettes effective in fighting nicotine addiction

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HERE are more than 1,000 studies proving that vaping or smoking e-cigarette is less harmful than tobacco or cigarette smoking, and is an effective tool in promoting smoking cessation, an expert said. Konstantinos E. Farsalinos, a research fellow at the Onassis Cardiac Surgery Center in Athens, Greece, and at the Department of Pharmacy, University of Patras, Greece, said e-cigarette use can, in fact, help save millions of smokers who are at risk of premature death. In a news conference, Farsalinos said the World Health Organization and concerned national health agencies, such as the Department

of Health in the case of the Philippines, should promote e-cigarette use—like a form of smokingcessation medication to smoking addicts. Farsalinos will be an expert resource person during a Senate Health Committee Public hearing tackling e-cigarettes on Thursday, where he is expected to share expertise and knowledge about smoking, tobacco harm control and e-cigarettes. The popularity of e-cigarettes, says Hong Kong-based Heneage Mitchell of factasia.org, has stirred spirited debate in many countries to the point of banning e-cigarettes. Mitchell said e-cigarettes offer smoking

addict a choice, and eventually, quit the more harmful habit of smoking cigarette by shifting to e-cigarettes. According to Mitchell, e-cigarette should be used only by adult smokers and ex-smokers, to promote smoking cessation and avoid premature death. “E-cigarettes are not for nonsmokers and definitely not for children,” he said. Both Farsalinos and Mitchell said they are not representing any interest or parties in the ongoing debate on cigarette use, but will offer their expertise to promote consumer choice, rational debate and sensible regulation. Jonathan L. Mayuga

Economy

A4 Monday, April 10, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

Asian carriers keen on using Clark airport–Cauguiran By Lorenz S. Marasigan @lorenzmarasigan

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lark International Airport Corp. is negotiating with a dozen foreign carriers for them to operate flight services in and out of the air hub in the north, as the government seeks to boost the usage of the underutilized facility. Alexander S. Cauguiran, who sits as president at Clark International Airport, said his group has received interest from Asian carriers, which are looking to launch services in Clark. “We have talked to 12 carriers mainly from Asia. We have talked to Thai, Japanese and Malaysian carriers. The reception was good during the first round of talks,” he said in an interview. He did not disclose the airlines the group is negotiating with, but said they will be invited for another round of talks. Chinese carriers are also looking into launching services in Clark. “China Eastern is interested to fly from Shanghai and Beijing to Clark. It is very much ready to mount these flights, but we are still in talks,” Cauguiran added. The corporation is looking to increase passenger traffic to as much as 1.5 million passengers by year-end. The airport logged in a total of 6,205 international and domestic flights with 950,732 passengers for local and foreign routes in 2016. Clark is seen as the immediate saving grace for the Ninoy Aquino International Airport (Naia), which has been operating at overcapacity for almost two years now. But over the past few years, local carriers have shied away from launching flights or expanding their operations in Clark due to the lack of full-service facilities, its distance from the capital, and the dearth in mass transit going to Manila, among others. It was only after President Duterte came into power, when local carriers decided to move some of their operations from the Naia to Clark. They have also launched, and are set to launch new services out of the airport in the north. The government has programmed a P2.8-billion budget for the expansion of the airport, which will open its new terminal four years from now.

Several groups have offered to develop Clark through unsolicited proposals. Claiming that its P187-billion offer is “fully compliant” with the requirements of the build-operatetransfer law, the consortium of Filinvest Development Corp. and JG Summit Holdings Inc.’s proposal involves the modernization of the airport under a five-decade concession, and will start with an initial capacity for 8 million passengers per year. Its proposal, based on the Aeroport de Paris master plan prepared for Clark in 2015, also allows the airport to expand its terminals and runways to easily accommodate for traffic growth over the next 50 years. The P250-billion proposal of GMR-Megawide Cebu Airport Corp., on the other hand, involves the development of the airport in six phases, leading to a total annual passenger capacity of 100 million per year. Under a 50-year development plan, it aims to build two terminals and three runways, two of which will be independent in an 850,000-square-meter land. The plan also involves the construction of an integrated railway connection from Manila, similar to the one in Delhi, India. This unsolicited offer is at no cost to the government, will not require any subsidy, guarantee or mandatory movement of airlines from Naia to Clark. Instead, the proponent “committed to pay the government annually a share of the airport revenues over the concession period”. Metro Pacific Investments Corp. is also readying its own unsolicited proposal, even as it waits for a public tender to take place. The government wants to place contract to develop of Clark under public bidding. It will be done through the Public-Private Partnership (PPP) scheme. The website of the agency, however, did not enumerate the specific details of the contract. Clark Civil Aviation Complex, located within the Clark Freeport Zone in Pampanga, covers an area of approximately 2,367 hectares with a 3,200-meter long runway and associated taxiways, aircraft parking apron, a passenger terminal building and related facilities. It has two runways in parallel configuration.

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Middle East countries to invest $650M in PHL

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By Catherine N. Pillas

@c_pillas29

resident Duterte will witness the signing of several memorandums of understanding (MOU) for the $650 million in investment pledges secured by the Philippine Economic Zone Authority (Peza) from Gulf State investors ahead of his trip to the Middle East on Monday. Peza Director General Charito B. Plaza told reporters in a recent interview that Middle East investors are “eager” to increase their presence in the Philippines and have committed to invest $650 million in various economic sectors and activities in the country. “These are 18 projects all in all, 10 from Qatar, one from the United Arab Emirates and seven from Saudi

Arabia,” Plaza said. According to data from the Peza, businessmen from Qatar will invest in a retirement village, a hotel/tourism economic zone, informationtechnology (IT) services, halal food processing, hospitals and medical economic zone, civil defense, IT and ecozone management services and export manufacturing. Investors from Qatar are expect-

PLAZA: “These are 18 projects all in all, 10 from Qatar, one from the United Arab Emirates and seven from Saudi Arabia.”

ed to spend $176 million for these projects, which are expected to generate 4,000 jobs. The lone project proponent from the UAE, which the Peza did not identify, intends to build an agroindustrial zone with a project price tag of $ 10 million and projected work force of 1,000. Investors from Saudi Arabia are keen on investing in the processing of Vasmati rice for export, manufacture of generic drugs, investment holdings company, developer of logistics facilities, coco fiber manufacturing, a mixed-use zone consisting of a hotel, tourism complex, and medical services, and a chain of fine-dining restaurants.

Saudia Arabia businessmen are expected to invest $465 million and create employment for 15,770 workers. “Three companies have already said they want to look for 1,000 hectares of land for their activities. They’re eager to invest and they’ll be coming in after the MOU signing,” Plaza said. This $650 million is on top of the $100 million secured by Plaza in two previous exploratory trips to the Middle East last year and in early 2017. Plaza will accompany President Duterte to the Gulf States from April 10 to 16, intending to visit Riyadh, Bahrain and Qatar. The Middle East remains as a top destination of choice of overseas Filipino workers. Of the top 10 deployment destinations in 2015, six are in the Middle East. In terms of remittances, the Middle East is the second-largest source with 28 percent or almost $7.6-billion remitted from the region in 2016.

DOE wants to make power facilities earthquake-proof

DBM told to expedite release of retirees’ pension By Elijah Felice E. Rosales @alyasjah

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IL A R , Bat a a n—President Duterte on Sunday ordered the departments of Budget and Management (DBM) and National Defense (DND) to speed up the processing of military retirees’ pension amounting to P6.42 billion. At the 75th commemoration of the Bataan Death March, Duterte instructed the DBM and the DND to certify as urgent the monetary benefits of retired military personnel. “I am directing the DBM and the DND to expedite the early release of the Armed Forces of the Philippines retirees’ pension credential for fiscal years 2008 to 2013 in the amount of P6.421 billion,” he said. This is on top of efforts of the administration to provide entitlements to surviving World War 2 veterans and their dependents. “No matter what we do, we can never do enough to repay you [veterans]. But I would like for you to know that [we are] doing much, much more,” the President said. Duterte said his government has already settled the backlog in disability pension, adding it made more efficient the management of almost 200,000 accounts. Disability pension is given to a veteran who was incapacitated due to sickness, disease, wounds or

injuries sustained in line of duty during the World War 2. The pension ranges from P1,000 to P1,700 depending on the disability rating of the disabled veteran. Additional pension worth P500 every month is also conferred to the spouse and unmarried minor children of disability pensioners with a 100-percent disability rating. Aside from monetary benefits, Duterte assured veterans and their dependents of free health care at the Veterans Memorial Medical Center and 152 other veterans-accredited hospitals. “I am instructing them today to further improve their services and accessibility.” At present, veterans and their dependents are protected under the Veterans Hospitalization and Medical Care Program (VHMCP) of the Philippine Veterans Affairs Office. The VHMCP seeks to assist them with their hospital fees and medical-care benefits, including financial support for hospital confinement, medical procedures and maintenance medicines. Furthermore, Duterte swore dependents of veterans will continue to receive state subsidy for their education under the Iskolar ng Bayan program. “These entitlements do not compare to the sacrifices that you have made. But we want you to know, our nation and our people are grateful to you for what you have done, and we will do better.”

By Lenie Lectura @llectura

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he Department of EnergyEnergy Policy and Planning Bureau (DOE-EPPB) is drafting a policy on resiliency planning and programs for the energy sector. The program aims to strengthen existing infrastructure facilities to withstand adverse weather conditions and incorporate mitigation improvements into the restoration of damaged infrastructure “so that recurrence will cause less damage”. Moreover, the proposed program would help improve operational and maintenance standards and practices to ensure expeditious restoration of energy supply after adverse weather conditions.

This, after a series of earthquakes rocked Batangas, Mindoro and other adjacent areas over the weekend. The Philippine Institute of Volcanology and Seismology reported that between 3:07 p.m. and 3:09 p.m. of April 7 successive earthquakes with a magnitude of 5.6 and 6, respectively, jolted Mabini, Batangas, affecting houses and major infrastructure, including energy facilities. While the earthquake caused power interruptions, the National Grid Corp. of the Philippines (NGCP) reported it fully restored at 3:45 p.m. of April all transmission facilities in areas affected by the tripping of generation plants due to the earthquakes that occurred at 3:08 p.m. of the same day. According to the NGCP’s

report, the Batangas-San Lorenzo Lines 1 and 2 were affected with an initial report on a toppled tower, and the switchyard at the San Gabriel Natural Gas Power Plant was also damaged due to the earthquake. The report also stated a generation loss of 2,584 megawatts, which affected the power supply and services of various provinces in Luzon, including Batangas, Laguna, Quezon, Ilocos Sur, La Union, Pangasinan, Bataan, Tarlac and Nueva Ecija. Energy Secretary Alfonso G. Cusi reminded the public to adopt safety precautions in using energy. “We want to remind everyone to adopt appropriate safety precautions and be prudent in their energy use

to ensure their family is safe when a disaster, such as an earthquake, strikes,” Cusi said. Among others, Cusi suggested that a periodic check for earthquake hazards posed by appliances that could move and cause rupture of electrical or gas lines. Following a similar check should be done before using those appliances. Cusi also said fire hazards and flammable fluids, such as kerosene, liquefied petroleum gas, solvents or cleaning products should be stored properly. In addition, Cusi reminded the public to prepare their own earthquake emergency kit at home that could include, food, water, medicine, flashlight, whistle, as well as plan to communicate with their family in times of emergency or disaster.

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US jobs data show beauty beneath ugly number

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or the March US employment report, with its ugly headline payrolls number, it’s what’s inside that counts. While the gain of 98,000 jobs in a survey of businesses and government agencies was the weakest since May and below all analysts’ forecasts, many accompanying details showed a solid labor market. The jobless rate, derived from a separate survey of households, fell to the lowest in almost a decade even as work force participation was unchanged, while a measure of underemployment reached a fresh postrecession low, boding well for further wage increases. “Aside from the payroll data, all the other underlying details are encouraging,” said Tom Simons, an economist at Jefferies Llc. in New York. “People are reentering the labor force and it looks like they’re getting jobs right away. The participation rate being steady is encouraging there.” The March data from the Labor Department last Friday also were challenged by weather anomalies— a storm in the Northeast during the survey week and more seasonable temperatures after two warmer months—that had economists bracing for at least some slowdown in payrolls from a strong start to the year. Weather effects probably explain about 70,000 of the difference in payroll gains between February and March, according to Goldman Sachs economists. The reassuring figures elsewhere in the report keep the Federal Reserve (the Fed) on track to continue plans for two more interest-rate in-

98,000 The number of jobs added since May

creases this year as the labor market continues to tighten. “The Fed is going to look past the March weakness—they’re going to continue to paint a positive picture of the labor market,” said Ryan Sweet, an economist at Moody’s Analytics Inc. in West Chester, Pennsylvania. “The trend in job growth remains solid and the overall economy is still doing well.” Markets appeared to be relatively unfazed by the payroll number. The S&P 500 Index of stocks was up 0.2 percent as of 1:50 p.m. in New York.

Construction, retail

Even so, there wasn’t much to sing about in the March payroll figures. The employment increase included a paltry 6,000 gain in construction jobs and 11,000 in manufacturing, after both sectors showed big gains in January and February. Among services jobs, retailers were hit hard last month. That industry showed the weakest two months for hiring since the end of 2009, battered at least in part by the broader trend of Americans flocking to online merchants rather than brick-and-mortar stores.

A worker in the United States Bloomberg

But for a labor market that’s already challenged by a dwindling supply of unemployed workers, the report may be flashing more warning signs of overheating than of cooling. The jobless rate fell for what economists often deem “the right reasons”—meaning that more people were employed and fewer were unemployed—not as a result of Americans fleeing the labor force in discouragement, or retirement. While President Donald J. Trump

With economy, consumers toe opposing party lines

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conomics has a foundation in hard numbers—employment, inflation, spending—that has largely allowed it to sidestep the competing partisan narratives that have afflicted US politics and culture. But not anymore. Since Donald J. Trump’s victory last November, consumer sentiment has diverged in an unprecedented way, with Republicans convinced that a boom is at hand, and Democrats foreseeing an imminent recession. “We’ve never recorded this before,” said Richard Curtin, who directs the University of Michigan’s monthly survey of consumer sentiment. Although the outlook has occasionally varied by political party since the survey began in 1946, “the partisan divide has never had as large an impact on consumers’ economic expectations,” he said. At the same time, familiar economic data points have become Rorschach tests. That was evident after the government’s monthly jobs report last Friday; Republicans’ talking points centered on a 10-year low in the unemployment rate, while Democrats focused on a sharp decline in job creation. “I find it stunning, to be honest. It’s unreal,” said Michael R. Strain, director of economic policy studies at the conservative American Enterprise Institute in Washington. “Things that were less politicized in the past, like how you feel about the economy, have become more politicized now.” Indeed, the night-and-day views underscore yet another front on which Americans remain polarized five months after the election, and with Trump nearing his 100th day in office. There are some tangible reasons for the split. Many Republican states, including the Midwestern swing states that provided Trump’s margin of victory, have experienced a more sluggish recovery over the past eight years—and are thus more invested in the change promised by Trump. Many Democratic states have bounced back more vigorously. Hence their political and economic viewpoints were jolted by November’s election result. For example, Vermont, Colorado and Massachusetts—all carried by the Democrats—are thriving, with an unemployment rate below 4 percent. In Republican strongholds like Alaska, Georgia and Alabama, the rate is well above the national average of 4.5 percent. Rank-and-file Republicans aren’t the only

ones who are feeling more upbeat, whether or not it’s justified by the data. Sentiment among business leaders who backed Trump has also surged since the election. David Congdon, chief executive of Old Dominion Freight Line, the trucking giant, never expected Trump to win when he voted for him last November. “I fell out of bed when I got up in the morning on November 9,” he admitted. “I didn’t quite know what I was voting for.” Despite misfires in Washington like the failed attempt to roll back President Barack Obama’s health-care policies, Congdon is definitely feeling more positive. “Trump’s got a hard road ahead of him, but I think he’s off to a decent start,” said Congdon, who recently joined other transportation executives for a meeting with Trump and Vice President Mike Pence. “I’m personally optimistic about the economy for the rest of the year, and I think we will see an uptick in terms of freight deliveries,” he said. “We have picked up our hiring.” Economists, too, find their outlook shifting with the political landscape. Before the election, Heather Boushey, a top adviser to Hillary Clinton during the campaign, thought “the economy was on the right track, with slow and steady growth like we’ve had over the past few years.” Now she is much more pessimistic, especially about the economy’s long-term prospects. Although she is pleased that the Affordable Care Act survived Republican efforts to repeal it, the gridlock has led her to believe that Trump will never get a big infrastructure spending package through Congress. “I am losing hope that we will make those much-needed investments over the next few years,” said Boushey, executive director of the liberal Center for Equitable Growth. The University of Michigan researchers have their own way of measuring the gulf between the two viewpoints and how quickly it has flipped. Among Republicans, the Michigan consumer expectations index was at 61.1 last October, the kind of reading typically reported in the depths of a recession. Confident that Clinton would win, Democrats registered a 95.4 reading, close to the highs reached when her husband was in office in the late-1990s and the economy was soaring. New York Times News Service

has condemned the headline unemployment rate as a “phony” measure on the campaign trail and “ridiculous” earlier this week, the gauges that his administration has favored also strengthened in March. Treasur y Secretar y Steven Mnuchin has cited the so-called U-5 rate, which includes discouraged workers, as well as a group called marginally attached workers, who aren’t working or actively looking for work but want a job. That rate

declined in March to 5.4 percent, the lowest since May 2007. The number of discouraged workers, not looking for work because they believe none is available, fell to 460,000 for the second-lowest since August 2008. The U-6 rate, which in addition to the U-5’s components, includes those working part-time for economic reasons—meaning they would prefer a full-time job—also was a bright spot. The measure fell to 8.9 percent, the lowest since December 2007.

“The president and I have spent a lot of time talking about the U-6 number,” Gary Cohn, director of the White House’s National Economic Council, said on Bloomberg Television after the report. “We’re happy to see that number below 9 percent.” The figures didn’t impress everyone. Barclays Plc. economist Rob Martin called it “a weak report with no silver linings” and labeled the decline in the unemployment rate a “catch-up” with data from the payrolls survey. The data point to the further divergence between “soft” sentiment surveys that are strengthening and the “hard” figures that have been slow to catch up, he said. “We look for labor markets to accelerate in the near term, but should that hope fail, we would expect activity to slow as well,” Martin wrote in a note, saying that monthly payroll gains in the 200,000 range “are consistent with continued economic expansion”. The two-month revisions to payrolls subtracted 38,000 jobs, leaving the average so far in 2017 at 178,000. That’s in line with the 187,000 monthly average for all of last year. Whether the tight job market triggers the long-awaited wage gains in this almost-eight-year-old economic expansion remains a puzzle. Average hourly earnings increased 2.7 percent in March from a year earlier, just a touch above the average since the start of 2016. That, more than weaker-than-expected employment, might merit more attention in the months ahead. While wage growth is modest, “there’s no reason to panic” about the hiring figures, Sweet of Moody’s Analytics said. “All in all, it’s right around what we need” to keep up with population growth and to keep the unemployment rate steady. Bloomberg News

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Trump-Xi achievement: Get to know each other

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nited States officials said President Donald J. Trump’s first meeting with Chinese President Xi Jinping this week was an opportunity for the leaders of the world’s two largest economies to get to know each other and set up future meetings. That was the biggest accomplishment after about 18 hours together at Trump’s Mar-a-Lago resort—a visit punctuated by a US missile strike on Syria on Thursday night. There were no trade or investment deals announced, no agreement to contain North Korea’s nuclear ambitions, no plan stitched together to reduce tensions in the South China Sea. A statement from White House Press Secretary Sean Spicer late on Friday cited an array of topics the pair and their contingents discussed, from North Korea to cyber security to protecting human rights, and said Trump and Xi “established a new and Cabinet-level framework ” for future talks. “We have very similar economic interests and there are areas where they clearly want to work with us,” Treasury Secretary Steven Mnuchin told reporters on Friday. “The objective is for us to increase our exports to them”. Commerce Secretary Wilbur Ross added that “the most interesting thing to me was they expressed an interest in reducing their net trade balance because of the impact it’s having on money supply and inflation. That’s the first time I’d heard them say that”. Trump tweeted on Saturday that the meetings had created “tremendous goodwill and friendship” but that “only time will tell on trade.” China’s leaders in fact have long been concerned about the yawning US trade deficit with their country, $347 billion in 2016. Ross said the two countries agreed to a “100-day plan” to discuss trade; there were few details. In tone and results, the summit was similar to a 2013 meeting between Xi and President Barack Obama in Rancho Mirage, California, that also produced little by way of tangible announcements. But Tr u mp’s i n aug u ra l v i sit

with Xi had a little more drama.

Syria strike

Trump upended the meeting by ordering the launch of dozens of cruise missiles at Syrian targets on Thursday, just before Xi’s arrival in Florida. The missile strike overshadowed the summit and also increased tension between the two countries over North Korea, days after Trump said in an interview with the Financial Times that he’s willing to take unilateral action against a regime flouting international norms. Secretary of State Rex Tillerson said, “there was no kind of package arrangement discussed to resolve” tensions with North Korea, adding that Xi agreed the situation “has reached a very serious stage in terms of the advancement.” Trump told Xi the US would “chart our own course if this is something China is just unable to coordinate with us,” Tillerson said. In his statement, Spicer said the two sides “noted the urgency of the threat” of Pyongyang’s weapons programs, “reaffirmed their commitment to a denuclearized Korean peninsula, and committed to fully implement UN Security Council resolutions.” For China, the meeting was probably a success. Much of the Communist Party’s top leadership will change during a congress later this year, and in the run-up to that event, “Xi Jinping just wants the United States off his back,” said Bonnie Glaser, senior adviser for Asia and the director of the China Power Project at the Center for Strategic and International Studies in Washington. The two leaders appeared to develop a rapport, she said.

‘Positive and fruitful’

China’s official news agency Xinhua said on Saturday the “positive and fruitful” meetings have sent a “clear-cut” message that Washington and Beijing can become great cooperative partners.

President Donald J. Trump and Chinese President Xi Jinping walk together after their meetings at Mar-a-Lago on April 7 in Palm Beach, Florida. AP/Alex Brandon

$347B The volume of US trade deficit with China in 2016

The presidents didn’t mention the Syria attack, and even steered clear in their public remarks of issues like trade that were supposed to dominate the summit. They remarked generally about “progress” in their relationship and optimism about the future. That could indicate that the relationship between the two countries remains stable, despite Trump’s fiery accusations during his campaign, and afterward, that China has stolen US manufacturing jobs. “The relationship developed by President Xi and myself, I think, is outstanding,’’ Trump said on Friday during a meeting between the two countries’ delegations. “I believe lots of very potentially bad problems will be going away.’’ In a posting on its web site on Saturday, China’s foreign ministry said the countries had agreed to “properly”

deal with issues of trade friction.

Strolling the grounds

Xi thanked Trump for his hospitality and said the meeting had served the purpose of advancing the USChina relationship. “We had long and in-depth communication,” Xi said through a translator. “And, more importantly, we have further built up understanding and establish a kind of trust, and we have initially built up a working relationship and friendship.” The two leaders were later photographed strolling the grounds of Trump’s waterfront resort. Trump accepted Xi’s invitation to visit China later this year, Tillerson said. Another matter that didn’t come up was the bankruptcy of Westinghouse Electric Co.’s nuclear-reactor business. Toshiba Corp., Westinghouse’s parent company, has sought a buyer for the unit and Trump administration officials are so concerned about Chinese investors obtaining control of it that they have sought an American or allied purchaser. “We have been looking very carefully at that,” Ross said. Mnuchin added that “any such transaction” would have to be reviewed by the

Mexico sees swift Nafta rewrite as Trump admin retreats in its protectionist rhetoric

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exico’s top trade negotiator said he was heartened by a retreat from more protectionist rhetoric in the US and that talks to redo the North American Free Trade Agreement (Nafta) may conclude as soon as January. Economy Minister Ildefonso Guajardo said the January date would depend on the administration of President Donald J. Trump notifying Congress in time for negotiations to begin by the end of July. “The US has to trigger the mechanism,” Guajardo said in an interview with Bloomberg TV’s Erik Schatzker in Buenos Aires. “What I keep hearing is that after Congress comes back from recess, they will be able to be notified by the end of April.” In that case ,talks can start by the end of July, followed by “six months of negotiations, and then we send it to the legislative branch for them to approve it.” Investors have shed their doomsday outlook on Mexico in recent weeks after White House officials repeatedly said both Mexico and the US stand to benefit from a renegotiation of Nafta. The peso has rebounded from a

record low in January and is now the best performer of all currencies tracked by Bloomberg, and companies that had put investments on hold as then-candidate Trump railed against Nafta are racing back into the country. “It will be in the best interest of both countries involved to make this process very efficient,” Guajardo said, noting that Mexico has presidential elections in mid-2018 and the US has a midterm vote in November of next year. Still, Guajardo warned that even minor changes may be difficult to negotiate. On one of those changes, raising the average percentage of auto inputs that must be made in the North American region to 70 percent from 62.5 percent seems reasonable, Guajardo said on the sidelines of the World Economic Forum’s Latin America meeting in Buenos Aires. However, pushing it to 95 percent would be extreme and hurt the region’s competitiveness. “Mexico will be willing to buy more from the US,” Guajardo said. “We can make an additional effort as long as you have the supply process already in place to be able to supply

in Mexico at a competitive cost.”

Softening the tone

The Trump administration has softened its rhetoric notably from January, when then-President-elect Trump tweeted that he’ll slap heavy taxes on businesses that move jobs to Mexico. Since then, US Treasury Secretary Steven Mnuchin has said redoing Nafta could spell a win-win for both sides. Commerce Secretary Wilbur Ross said he anticipates a sensible deal, and Peter Navarro, who leads the White House National Trade Council, said he wants Canada, Mexico and the US to become a global manufacturing powerhouse. Some of Trump’s early stumbles, such as the collapse of the healthcare bill and court orders against two attempts at a travel ban have also underscored how hard it is to make any drastic changes in Washington. For example, House Speaker Paul Ryan has been pushing to replace corporate income tax with a tax on businesses’ domestic sales and imports, exempting exports. The border adjustment tax proposal

raised alarm bells among importers in the US, as well as government officials in Mexico as they feared it would reduce shipments north of the border. But support for the measure has waned in Washington. That border tax may run the risk of violating principles of the World Trade Organization, and Mexico reserves the right to file a complaint against it, Guajardo said in the interview. In addition, if the US reduces its corporate tax rate, the nation would have to rethink its own tax policy to keep being attractive for foreign investment. A March 22 draft proposal to rework Nafta signed by acting US Trade Rep. Stephen Vaughn states that the US will seek to give preference to domestic companies for government procurement while finding opportunities for US companies to bid in Mexico and Canada procurement markets. While noting that the White House has backed away from the letter, Guajardo said that if the US wants access to Mexico’s public purchases, it will have to give Mexico access to its own public purchases. Bloomberg News

Committee on Financial Investment in the US, which can block sales of US companies to foreign investors.

Surface charm

The friendly banter between the leaders belied growing tension in the relationship after Trump’s public criticisms of China and his promises to extract concessions from the country on trade and North Korea. “We have been treated unfairly and have made terrible trade deals with China for many, many years,” Trump told reporters aboard Air Force One on Thursday as he flew to Palm Beach. “That’s one of the things we are going to be talking about.” His Cabinet secretaries said Trump indeed confronted Xi. “President Trump noted the challenges caused by Chinese government intervention into its economy,” Tillerson said on Friday. “The president underscored the need for China to take concrete steps to level the playing field for American workers, stressing repeatedly the need for reciprocal market access.” Trump informed Xi of the missile strike as they were dining, roughly when 59 Tomahawk missiles were hitting a Syrian airfield. Trump told

reporters the strike was in response to a nerve gas attack by the Syrian regime against civilians on Tuesday. The Chinese have opposed efforts to remove Syrian dictator Bashar al-Assad from power and probably took offense at the attack, said Dennis Wilder, former senior director for Asia during the George W. Bush administration. “For President Xi, this will be embarrassing internationally because in so many settings and so many venues China has condemned the United States for unilateral military action in the past, and this is certainly a unilateral action,” he said. “I think that the Chinese will be expressing some anger privately to the United States.” China’s public probably won’t regard the strike as a message to their leaders unless the Trump administration makes the case explicitly, said Doug Paal, vice president for studies at the Carnegie Endowment for International Peace in Washington. “I doubt the Chinese in the end think this was really done as a message to Beijing,” said Paal, who served as Asian affairs director in the administrations of Ronald Reagan and George H.W. Bush. Bloomberg News

UK manufacturing, construction point to loss of momentum

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nited Kingdom manufacturing and construction unexpectedly shrank in February, adding to signs that the economy lost momentum in the first quarter. Factory output fell 0.1 percent from January, the Office for National Statistics (ONS) said on Friday. Total industrial production declined 0.7 percent as unseasonably warm weather reduced demand for energy. Construction dropped 1.7 percent, the most in almost a year. While industrial output and construction are still likely to contribute modestly to growth in the first quarter, the economy will get no help from trade, which drove the expansion in the final period of 2016. The National Institute of Economic and Social Research estimates that GDP rose 0.5 percent in the first quarter, down from 0.7 percent at the end of 2016. The deficit in goods and services grew to £3.66 billion ($4.55 billion) in February, according to the ONS, meaning the shortfall will widen in the first quarter unless March posts a near-unprecedented surplus. Exports fell 0.1 percent in February and imports rose 1.2 percent, although the latter was boosted by shipments of nonmonetary gold and

aircraft. Excluding erratic items, imports fell 1.7 percent, and the deficit narrowed slightly. The fall in manufacturing was the second in succession, casting doubt on the benefits firms are getting from the weaker pound. Only seven of 13 subsectors posted increases in February. Pharmaceuticals, which tend to fluctuate from month to month, dropped 4.4 percent. The decline in construction followed a flat January, with a sharp drop in new work being only partially offset by repair and maintenance. Together, building output and industrial production account for a fifth of the UK economy. The figures come against a deteriorating backdrop as accelerating inflation erodes the purchasing power of consumers and looming Brexit talks cloud the outlook for investment. Bank of England policy-maker Gertjan Vlieghe indicated this week he is in no hurry to demand an end to record-low interest rates. Key to the first quarter will be the performance of the dominant services sector, which is continuing to expand at a healthy pace if recent surveys are an accurate guide. Bloomberg News

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US-led force reduces attacks on IS in Syria after air strike

Protesters gather during a rally against the US missile strikes in Syria on April 7 in New York. The US fired a barrage of cruise missiles into Syria on Thursday night in retaliation for a chemical-weapons attack against civilians earlier in the week. AP/Andres Kudacki

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ASHINGTON—The US-led task force that is battling the Islamic State (IS) has sharply reduced air strikes against the militants in Syria as commanders assess whether Syrian government forces or their Russian allies plan to respond to the United States’s cruise missile strike on a Syrian airfield this past week, US officials said. The precautionary move, revealed in statistics made public by the command on Saturday, was taken as Russian officials have threatened to suspend the communication line the US and Russian militaries use to notify each other about air operations in Syria. So far, the Russian military does not appear to have taken any threatening actions, such as directing its battlefield radar or air defense systems to confront the Americans, or carrying out aggressive actions in the skies, US officials said. But officials who spoke on the condition of anonymity to discuss internal planning said the commanders needed time to determine whether the Syrian president, Bashar al-Assad, and the Russian military would treat the US cruise missile strike as a onetime operation that they would not respond to militarily. As a precaution, the Defense Department is flying patrols in Syrian

skies with F-22 jets, the Air Force’s most advanced air-to-air fighter. If it becomes clear that the Syrians and Russians will not follow their sharp criticism of the operation with significant military action, the pace of US air strikes against IS forces in Syria can be quickly increased. Over the past two years US and allied warplanes striking IS targets in Syria have had to fly among formidable Syrian and Russian-supplied air defenses. While there have been a few close calls between Russian and US jets, some of them unintentional, the US-led air campaign has, for the most part proceeded without interference from Russian or Syrian fighters, or air defenses. Publicly, US officials had little to say about the reduction in strikes against the militants. “We are using resources as appropriate to the commander’s priorities and as the situation dictates,” a military official said. Last Friday in Syria, the day the

59 The number of cruise missile the US fired against Syria’s Al Shayrat airfield last Friday

United States fired 59 cruise missiles around 3:40 a.m. local time against Al Shayrat airfield, the US-led coalition carried out just seven air strikes against IS targets in Syria, according to the command. All the air strikes were near Tabqah, where Syrian fighters and US advisers are trying to take the town and a nearby dam, a move that would cut off the western approaches to Raqqa, the IS’s self-styled capital. By contrast, last Tuesday the USled command carried out twice as many strikes in Syria against the IS, and against a broader array of targets. On March 27 the command conducted 19 strikes in Syria against IS militants. In the Raqqa mission, US Special Operations forces assisting Syrian Kurdish and Arab fighters in their encirclement of the city, in eastern Syria, have also taken unspecified precautions against possible retaliatory attacks, military officials said. The US struck the airfield in

response to a deadly chemical-weapons attack by the Syrian government. US officials have said the purpose of the airfield attack was to dissuade Assad from using chemical weapons again and that it was not intended to be part of a broader military effort to undermine the Syrian leader’s hold on power. As long as Assad refrains from using chemical weapons again, the officials have said, the US does not plan to carry out further attacks on his forces. Some US and other Western counterterrorism officials have said the missile strike could, nonetheless make the fight against the IS in Syria more difficult. “It seems clear that the strikes will complicate our efforts to pursue our counter-ISIS [Islamic State in Iraq and Syria] campaign in Syria,” said Matthew Olsen, a former director of the National Counterterrorism Center. “In particular, the ability to carry out US air strikes in Syria in support of the coalition against ISIS requires some degree of cooperation with Russia, which is now in serious jeopardy.” Other security experts said much depended on the Trump administration’s next steps, and how the Assad government and its Russian patrons responded. “US aircraft operating over Al-Tabqah are already ostensibly in range of the Russian S-400 system at the Humaymin Air Base, and we might see Russia deploy more air defense assets to Syria,” Jeremy Binnie, the Middle East editor of Jane’s Defense Weekly, said in an e-mail. “But if the US makes no moves to threaten Assad’s position, then they may well accept the punishment and move on.” William McCants, a senior fellow at the Brookings Institution and the author of The ISIS Apocalypse, offered a similar assessment. If the strikes are limited to what took place this past week, “then they don’t change much,” McCants said. “They won’t help jihadists propagandize against the US, because the missiles targeted the hated Assad regime. Russia wasn’t doing much against ISIS, so Russian anger at the strikes won’t affect the coalition effort against the group.” But McCants added: “If the US continues to degrade Assad’s air force, it will be a boon to all the rebel groups, including the non-ISIS jihadists who have been targeted by the regime. They will begin to recapture some of the territory they have lost.” Russia sent warplanes to Syria in 2015 in a successful effort to help Assad maintain his hold on power and expand the territory under his control. The Russians began their first airstrikes in late September of that year. US officials have frequently complained that most of the Russian airstrikes have been directed not against the IS but against rebels fighting Assad’s forces, including the moderate opposition that has been trained and equipped covertly by the CIA. New York Times News Service

Iran’s long-exiled prince wants a revolution in age of Trump

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UBAI, United Arab Emirates— Iran’s exiled crown prince wants a revolution. Reza Pahlavi, the son of the last shah to rule before the 1979 Islamic Revolution, has seen his profile rise in recent months following the election of US President Donald J. Trump, who promises a harder line against the Shiite power. Pahlavi’s calls for replacing clerical rule with a parliamentary monarchy, enshrining human rights and modernizing its state-run economy could prove palatable to both the West and Iran’s Sunni Gulf neighbors, who remain suspicious of Iran’s intentions amid its involvement in the wars in Iraq, Syria and Yemen. But the Mideast is replete with cautionary tales about Western governments putting their faith in exiles long estranged from their homelands.

Whether Pahlavi can galvanize nostalgia for the age of the Peacock Throne remains unseen. “This regime is simply irreformable because the nature of it, its DNA, is such that it cannot,” Pahlavi told The Associated Press. “People have given up with the idea of reform and they think there has to be fundamental change. Now, how this change can occur is the big question.” Pahlavi left Iran at age 17 for military flight school in the US, just before his cancer-stricken father Mohammad Reza Pahlavi abandoned the throne for exile. The revolution followed, with the creation of the Islamic Republic, the takeover of the US Embassy in Tehran and the sweeping away of the last vestiges of the American-backed monarchy. Yet, the Pahlavis and the age of the

monarchy have retained their mystique in Iran, even as the majority of its 80 million people weren’t alive to experience it. Television period pieces have focused on their rule, including the recent state TV series The Enigma of the Shah, the most expensive series ever produced to air in the country. While incorporating romances or mobsters into the tales, all uniformly criticize the royal court. But Pahlavi, 56, insists young Iranians increasingly look toward Iran’s past. He pointed to recent demonstrations at the tomb of the pre-Islamic King Cyrus the Great, which have been claimed by a variety of antigovernment forces as a sign of unrest. Under his father’s secular and pro-Western rule, Iran experienced a rapid modernization program financed by oil revenues.

“If you look at the legacy that was left behind by both my father and my grandfather...it contrasts with this archaic, sort of backward, religiously rooted radical system that has been extremely repressive,” Pahlavi said. Since the US election, Pahlavi has given a growing number of media interviews, including with Breitbart, the far-right web site once run by Trump’s chief strategist, Steve Bannon. Pahlavi also has sent letters to the Trump administration. Gauging national sentiment toward restoring the monarchy in Iran is impossible, especially after the crackdown that followed the country's disputed 2009 election. Iranian state media routinely refer to the Pahlavi monarchy as “despotic,” but there has been some reassessing of history in other quarters. AP

briefs N. korea: syria air strikes prove its nukes justified

PYONGYANG, North Korea—North Korea has vowed to bolster its defenses to protect itself against air strikes, like the ones President Donald J. Trump ordered against an air base in Syria. The North called the air strikes “absolutely unpardonable” and said it proves that its nuclear weapons are justified to protect the country against Washington’s “evermore reckless moves for a war”. The comments were made by a Foreign Ministry official and carried by North Korea’s state-run Korean Central News Agency on Sunday. The report did not name the official, which is common in KCNA reports. AP

Norway’s security service probes into explosives case COPENHAGEN, Denmark—Norway’s security service has taken over an investigation into an explosive device found overnight by a busy subway station in the Norwegian capital of Oslo, prompting the police to evacuate nearby bars and restaurants. Oslo police said the device, found outside the Groenland underground station, was neutralized and a suspect was arrested. PST Spokesman Martin Bernsen says, “there are several reasons” for PST to “secure evidence and make the interviews.” He spoke on Sunday to the Aftenbladet daily. AP

insurgents kill 13 afghan forces in separate attacks

KABUL, Afghanistan—Insurgents have killed at least 13 Afghan security forces in separate attacks, officials said on Sunday, as the country struggles to contain a long-running Taliban insurgency and combat a growing threat from a local Islamic State (IS) affiliate. Munir Ahmad Farhad, spokesman for the governor of the northern Balkh province, said a roadside bomb killed nine security forces and wounded several others the night before in the Chimtal district, where they were waging an ongoing operation against the Taliban. He said five insurgents have been killed and dozens wounded. In a separate incident, IS militants attacked the Darzab district headquarters in the neighboring Jawzjan province Saturday night, and that gun battles were still under way, said Mohammad Reza Ghafori, spokesman for the provincial governor. AP

church bombing north of egypt’s capital kills 13

CAIRO—Egypt’s Health Ministry says a bomb has struck a church north of Cairo, killing at least 13 people and wounding 25 others. The attack took place on the Coptic Christian Palm Sunday, when the church in the Nile Delta town of Tanta was packed with worshippers. Ministry Spokesman Khaled Megahed confirmed the toll from the attack in an interview with CBC TV. The state-run Mena news agency provided the same death toll and said 35 were wounded. AP

Agriculture/Commodities

A10 Monday, April 10, 2017 • Editor: Jennifer A. Ng

BusinessMirror

news@businessmirror.com.ph

WTO told: PHL can’t convert QR into tariff yet DA to pilot-test new loan program in two towns T

File photo

By Jasper Emmanuel Y. Arcalas

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@jearcalas

anila has informed the World Trade Organization (WTO) that the Philippines may not be able to convert the quantitative restriction (QR) on rice into tariff by July 1 due to the delay in the amendment of a domestic law.

Agriculture Undersecretary for Policy and Planning Segfredo R. Serrano said Noel Padre, director of the Department of Agriculture’s (DA) Policy Research Service, was given the task of informing the WTO. “I sent Padre to Geneva, Switzerland, to explain the initiatives the government is undertaking so we will be predictable to [the WTO]. [My marching order] was to report that the legislative process is something we can’t control,” Serrano told reporters on the sidelines of a recent news briefing. “But there are things we are currently doing, that there are already bills filed to amend [Republic Act (RA) 8178] and while we are not able to comply we are maintaining our concessions [under the waiver],” he added.

Serrano said extending the concessions under the Philippines’s waiver on the special treatment on rice is an option to avoid disputes with other WTO member-countries. Former President Benigno S. Aquino III had to issue Executive Order (EO) 190, which outlined the concessions that allowed the Philippines to continue implementing the QR on rice. Under EO 190, the concessions will expire on July 1. “As a gesture of goodwill and to avoid disputes, the Philippines would maintain the concessions while RA 8178 has not yet been amended,” Serrano said. On July 24, 2014, the WTO General Council approved the Philippines’s waiver on the special treatment on rice, allowing Manila to keep its QR on rice until June 30.

However, the WTO General Council approved the waiver on the condition that the Philippines will subject its rice imports to ordinary custom duties by July 1. “At the expiration of this waiver, and no later than June 30, 2017, the importation of rice shall be subject to ordinary customs duties in accordance with paragraph 10 of Annex 5, Section B, of the Agreement on Agriculture,” the WTO General Council decision read. One of the concessions made by Manila in securing the waiver was to lower the tariff on mechanically deboned meat (MDM) to 5 percent, from 40 percent. Under EO 190, the tariffs on MDM would revert to its original rate on July 1. The WTO General Council also noted that the concessions made by the Philippines in securing the waiver would cease to exist upon the expiration of the waiver. To allow the conversion of the QR into tariffs, Serrano said RA 8178 must be amended. Under RA 8178, rice is the only agricultural commodity with QR and the law did not specify a termination date for it, according to Serrano. However, Serrano said retaining the concessions while RA 8178 is being amended is not an assurance that trading partners will not file a complaint before the WTO against the Philippines for not converting the QR.

“It’s not a guarantee. What we are saying to interested parties, our trading partners, is that the Executive branch cannot intervene in the enactment of a law. That’s the domain of the Legislative branch, which has its own process,” he said. Even if the waiver expires on June 30, Serrano said the government will continue to implement the QR on rice as mandated by RA 8178. “That’s a no-brainer because you have to implement the law. Besides, it’s not the DA that is implementing the law on QR, it’s the NFA [National Food Authority],” he said. A source privy to the meeting in Switzerland said there was no “substantive” discussion regarding the Philippines’s statement during the WTO Committee on Agriculture (COA) meeting on March 27 in Geneva. Another source disclosed that the Philippines had bilateral talks with the United States after the WTO COA meeting. “The US was concerned about the concessions.” Meanwhile, other trading partners, like Vietnam and Thailand, initiated “informal” talks with the Philippines concerning their riceimport quotas, the source said. “Thailand was concerned on what will happen with their quota, given that they have a huge riceimport quota. They wanted to increase their quota, but there’s no formal talk yet,” the source added.

Food security: Better nutrition begins with improving agriculture

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dministration after administration is coming to the conclusion that the future of the Philippines—to a large extent – hinges on improving the agriculture sector, as it will address inclusive growth, poverty alleviation and, finally, keep the young ones on the farm. Has it worked so far? No. As a result, more farmers or employment in agriculture are shifting to industrial and information-technology sectors. As a result, there were mismatches or misalignment of jobs and food inadequacy because no more manpower in the agricultural area. The Food and Agriculture Organization (FAO) provides recommendation as to a mechanism in solving the gaps between poverty in the streets, food inadequacy, employment and malnutrition. The recommendations must be paired with the following programs: 1.) Urban agriculture; 2.) Income growth; 3.) Direct nutrition interventions; 4.) Investment in health, water and education. Although the Philippines showed improvement and progress, the 2014

child wasting to less than 5 percent. In Metro Manila the hunger incidence prevalence is indeed alarming and covers more than 550,000 families, living in the street and under bridges.

Henry J. Schumacher Global Nutrition Report of the International Food Policy Research Institute (Ifpri) provides that the status of its hunger incidence is still alarming and in red flag—“Serious.” The report also implied that the Philippines would not be able to meet any of the six nutritional targets of the Global World Health Assembly. The targets are as follows: 1.) Reducing child stunting by 40 percent; 2.) Reducing anemia in women of reproductive age by 50 percent; 3.) Reducing low birth weight by 30 percent; 4.) Preventing an increase in child overweight; 5.) Increasing exclusive breastfeeding of infants up to at least 50 percent; and 6.) Reducing and maintaining

Are there options?

Urban agriculture has been defined by the FAO as the practice of cultivating, processing and distributing food in, or around, a village, town or city. Urban farming is a particular portion of urban land use where food is grown primarily for sale. Urban farming is the growing, cultivating and distributing food within a city or town boundary to generate revenue. Revenue-generating urban agriculture has also been termed market gardening, commercial urban agriculture and entrepreneurial urban agriculture. How can urban farming address the issues of hunger, malnutrition, etc., in urban areas? Let’s look at some ideas: 1. Urban farms are
often high profile that can have great potential for collaboration within the community by building partnerships with developers, local government units, faith-based organization the food service industry,

schools, community organizations, and others, and—very important— with business leaders who see the need for CSR to assist the less privileged; 2. A project will have to identify public free spaces, institutional land, vacant lots or underutilized sites; 3. It will have to profile and identify beneficiaries, jointly with LGUs and the DSWD; the beneficiaries will have to be trained and continuously be supported by social workers; the areas to be converted to urban farming have to be protected; and some produce have to be shared for consumption among the urban poor who are planting/ harvesting and the rest sold for livelihood to business partners/consumers. What can be planted anytime, all season: ampalaya, sitaw (hyacinth bean), cabbage, carrot, celery, cowpea, cucumber, eggplant, lettuce, leaf mustard, okra (lady’s fingers), kangkong (tropical spinach), patola (loofah), pechay, pole sitao (stringbean), abitsuela (snap bean), tomato, black pepper, gabi (taro), papaya and kamote (sweet potato. Who wants to partner with us? Contact Schumacher@mca.ph

he Department of Agriculture (DA) said the pilottesting of a new loan program aimed at easing farmers’ access to credit will be conducted in two towns in Surigao del Norte and Nueva Ecija. Agriculture Secretary Emmanuel F. Piñol said the government has set aside P35 million for the Production Loan Easy Access (PLEA), which will initially be implemented in Malimono, Surigao del Norte, and Bongabon, Nueva Ecija. “The two towns have been chosen as the first two laboratories of an innovative lending program aimed at increasing the productivity of farmers and fishermen and lifting them out of poverty,” Piñol said in a statement. The DA noted that Malimono is a fishing-dependent municipality, while Bongabon is an onion producer. Under the PLEA prog ram, each far mer f rom the two municipalities could borrow as much as P50,000, according to Piñol. He said the PLEA program will be implemented by its attached agency, the Agriculture Credit Policy Council (ACPC), which handles the lending programs of the DA across the country. “ACPC will allocate P15 million for Malimono and P20 million for the farmers in Bongabon. In Malimono, a poor town with

rich fishing grounds, the initial P15 million will be downloaded to a local credit cooperative, which will be lent at an interest rate of 6 percent per annum,” Piñol said. “Every farmer and fishermen who will avail themselve of the loan will be automatically covered by crop insurance under the Philippine Crop Insurance Corp. and the premium will be deducted from his loan proceeds,” he added. Piñol said before the implementation of the lending program, farmers and fishermen will be properly identified and their areas properly marked through geo-tagging. After the verification, all information will be placed in a computer database with verified farmers being issued with identification cards complete with their biometrics and passbooks, he added. “At an interest rate of 6 percent per year, or .5 percent per month, the maturity of the loan will depend on the commodity and activity that the borrowing farmer will be involved in,” Piñol said. For rice and corn, he said, he recommended a two-year loan maturity, five years for highvalue crops like cacao and coffee, and a maximum of 10 years for long-gestating crops like coconut and mango. Jasper Emmanuel Y. Arcalas

PIDS wants online repository for local food manufacturers By Cai U. Ordinario @cuo_bm

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tate-owned think tank Philippine Institute for Development Studies (PIDS) urged the government to create a central online repository of technology information for food manufacturers nationwide. PIDS sa id t his technolog y transfer can occur between large and small food small and medium enterprises or two small SMEs. It can also occur between local and foreign firms. This, the study said, will not only address the lack of government support for technolog y transfers but also fragmented promotional activ ities of the government. “It has long been recognized that the Philippines face the greatest challenge in the area of technology development and acquisition, and this is particularly true in the case of the Philippine SMEs.” The study said the online repository can be patterned after the Apec Centre for Technology Exchange and Training for Small and Medium Enterprises (Actetsme). The Actetsme was initiated by the Philippine government to harness the resources of Apec member-economies to support the growth and sustainability of SMEs in the region. T he prog ram, managed by

the College of Economics and Management of the University of the Philippines in Los Baños, aims to promote and facilitate technology exchange and training among SMEs in the Apec region. “ The prevailing impression is that promotional activities of different government agencies are fragmented, hence, a central online repository of technology information similar to that offered by Actetsme should be encouraged,” the study read. The PIDS study said such a repositor y w ill be of significant help to food manufacturers, which account for about 39 percent of t he cou nt r y ’s manufacturing sector. The food manufacturing sector composes 39 percent of establishments in the manufacturing industry, or 9,891 out of 25,064 total establishments in 2012. Of the food manufacturing establishments, about 95 percent are SMEs. Large local Filipino players include San Miguel Corporation and Universal Robina Corporation, and Monde Nissin Corporation while top foreign players include Nest le, Dole, and Del Monte. The data indicate that manufacture of other food products has the highest number of establishments at 7,407 followed by manufacture of grain mill and starch products at 1,237.

A BusinessMirror Special Feature

Monday, April 10, 2017 A11

www.businessmirror.com.ph

My grandfather is an insect By Vernon Velasco

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KILLED my grandfather. It was a confession I made to my mom, who believes that a moth swinging by at the house is a reincarnation of a dead relative. Specifically, the insect in question has to be what I later learned as Antheraea pernyi, a four-winged humongous kind that is teak in color. We would see the moth either meditating on the sofa or clinging to the silverware or taking a breather within the folds of my sister’s bedroom curtain.

An Antheraea pernyi evoked among us a more intense feeling of dread than would flying cockroaches and massive spiders dart-

ing from one hideout to the next, not as much owing to its sinister appearance as to how our mother would admonish us to observe in

SAINTS W

ORDS have it that if you ask someone to pray for you, chances are it would be granted. This time I was confused, though, me kowtowing before the Magellan's Cross, an historic totem symbolic of Spanish religious conquest of the Philippines. A place of worship that it is, people from miles and miles around visit this tourist attraction in Cebu, whose patron saint is the charismatic Child Jesus, so that they could personally buy a candle to throw into this altar and pray. But which exactly they were uttering a prayer to, the Sto. Niño or the titular Ferdinand Magellan? Mine was addressed to Magellan, which, if my grade-school memory serves me right, was crucial to Lapu-Lapu's (the first-ever known Filipino hero) 15 minutes of fame. I also prayed to the latter once I was in Mactan that, if he himself, by the power vested in him by his heroic renown, could not have my wish granted, at least he convey my prayer to his god. This is something righteous and immaculately dressed religious do with depressing regularity. Maybe God doesn't listen to sinners, so they ask saints to intercede for them. Where I grew up, though, the idea of saints are people (sinless or otherwise) who have gone ahead. I don't know with animals, but I once caught my mom telling our pet Dapple to carry over whatever sickness we had and all of our sins when he made it to dog heaven. The same went when people we hold dear died: people would give utterance to a prayer, not a Hail Mary or Our Father, but something more personal and directed to the dead. What can be gleaned is that prayer is a language, like English and Spanish, addressed to an entity that does not respond. It cannot be understood by regular humans; I mean you have to be dead first and

become a proverbial wandering soul in order to read minds, or celebrated in the grandeur of silence and prayers. Death confers a privi-

lege: to become godlike. And by godlike, it doesn’t mean the state of being all-powerful, but the state of being dead. VERNON VELASCO

its presence a profound sense of quiet, the way she might when we are in a room and we get a sudden whiff of candles and spent flowers,

which she takes to mean as a visit from the dead. We had not seen an Antheraea pernyi for quite a long time

when we recently stumbled upon one stuck for days on the linoleum. After doing math on her head, my mother identified the moth as our late grandfather, saying that it’s November, “his birth month,” and that particular visit was supposed to remind us of that. “He’s watching us,” she warned. To pay respect we steered clear of his whereabouts, even excusing ourselves if we wanted to pass. I wasn’t that careful, however, as once, in a half sleep, I stepped on what felt like egg shell in a different area of the house, and it didn’t take time at all before I realized I stepped on my grandfather, his insides sticking to the sole of my feet like caramel. “What the fuck!” “What the fuck!” my mother cried. “You killed my dad!” I explained to my mom that it was an accident, that at least I did not kill his dad the way we swat flies off the table and hit lizards with slippers. I really felt sorry for myself and tried to console her, until it occurred to us that, bored, our grandfather might be tired of being a moth, and was suicidal the way you might hurl yourself onto the path of a speeding train. The message was clear: they need help. And they visit the house in hope of being, say, stepped on, so that they could, perchance, come back as a baby.

Green Monday BusinessMirror

A12 Monday, April 10, 2017

www.businessmirror.com.ph • Editor: Lyn Resurreccion

Sardine run in Moalboal, Cebu Oceana Philippines

Saving the lowly sardines

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By Jonathan L. Mayuga

@jonlmayuga

hey may not be the most popular, but sardines are the most abundant of all fish species, and they have been part of the human diet for a long time. Because of their abundance, they are a very important family of epipelagic fish among the most commonly caught fish in the Philippines.

Rich or poor, people eat sardines. A good source of protein, sardines are delicious, easy to cook and very affordable. In fact, they may be the most undervalued fish. In the Philippines a kilo of fresh sardine costs P80 to P180. Smoked sardines cost around P5 to P10 a piece, depending on the size. In cans, which are widely distributed and accessible in retail stores and probably the most popular food, they cost around P17 to P22, making it one of the most affordable foods. Sardines are har vested on a massive scale by commercial fishers. They are also consumed by larger predators in the open sea, yet, their population keeps bouncing back.

Threatened species

Lately, overfishing and climate change are fast catching up with these highly resilient species. “Even the fishes in canned sardines are getting smaller and smaller, a sign there is really a problem,” said Gloria Estenzo Ramos, vice president of Oceana Philippines. W hile there is no sardinesupply shortage yet, the government and Oceana Philippines are moving to protect and conserve sardines, to ensure that they will not go extinct, an official of the Department of AgricultureBureau of Fisheries and Aquatic Resources (DA-BFAR) said. Capture Fisheries Technology Division Chief Rafael Ramiscal said there is a need to enhance e x i st i ng pol ic ies to pre vent

355,000 MT The average volume of sardines harvested by commercial and smallscale fishers annually, generating an estimated value of P10.45 billion overfishing, allow fish stocks to repopulate and replenish the country’s fishing grounds. “Sag ip Sardinas”, a nationw ide campaig n to promote sustainable production of sardines, was launched by Oceana Philippines and DA-BFA R late last month to put in place a Nationa l Sardine Management Framework Plan (NSMFP). The target is to come up with a science-based NSMFP by October for implementation next year. The NSMFP will serve as the country’s first sardine fisheries roadmap.

Strategic planning

Ramiscal said the formulation of the NSMFP would be based on good science, realistic policy and efficient governance and supported with adequate budget support. “ T he plan w il l be developed t h roug h a con su lt at ive pro cess that w il l involve fishers, loca l gover nments, scientists, traders, processors, non-gover nmenta l organizations and consumers,” he added. “We need to consider correct

identif ication of species and genetic stock, determine fish abundance, geophysical process and lifecycle, including drivers, such as environment and other ecosystem processes,” he said. A mong t he pol ic ies bei ng eyed include stricter regulatory process in catching or har vesting sardines—to leave behind e nou g h bi g ger - si z e d s paw n ers, catch only those that have reproduced at least once and adjust according to stock and environmental conditions.

Forage fish

Sardines are forage fish, and their very existence is key to the survival of a lot of other marine wildlife, including pelagic birds, Ramos said. Sardines are at the base of the food chain, next to plankton, making their existence very important for the survival of a lot of other bigger fishes and predators on top of the food chain. “A ll Filipinos can relate to canned sardines. But not all really know about the fish,” Ramos said. Commercially viable fish, like mackerel and tuna, sharks and dolphins and whales, feed and survive on this forage fish. The extinction of sardines, being the primary source of food in the ocean, could also spell the extinction of the most commercially viable fish, like tuna and mackerel, and even sharks, dolphins and large marine mammals, which play very important ecosystem functions in the oceans. Pelagic birds or sea birds, which frequent coastal waters and the open sea, like sea gulls, pelicans and albatrosses, also rely on the abundance of sardines and other pelagic fish. Pelagic birds need sardines not only for themselves, but for their youngs to ensure their species will continue to thrive. Through the Sagip Sardinas campaign, Ramos said they intend to address the unsustainable fishing practices, both by commercial fishing companies and small-scale fishers, through science-based fisheries management. The challenge is to strike a balance between the supply and demand for sardines, while addressing the challenge posed by the stiff

competition between man and the other predators in the wild.

Tuna industry

While sardine-canning factories reap the benefits of having abundant supply of the fish, overfishing eventually threatens the multibillion-dollar tuna industry. Being a major producer of tuna, the Philippines is expected to feel the brunt of overfishing sardines, once the tuna catch starts to go down, said Dr. Jose Ingles, member of the Sardine Industry’s National Mountaineering Federation of the Philippines technical working group and consultant of Environmental Defense Fund To ensure a healthy tuna population, sardine population should also stay healthy—enough for both humans and other predators. Tuna, whether fresh or canned, is being exported by the Philippines. The tuna industry is a major employer, particularly in Mindanao, where most of the canning factories are situated.

Over production?

Milagros Morales, of f icer in charge of the BFA R , said sard ines a re economica l ly important f ish species. Citing Philippine Statistics Authority (PSA) data, Morales said an average volume of 355,000 metric tons (MT) are harvested by commercial and small-scale fishers annually, generating an estimated value of P10.45 billion. From the DA-BFAR’s own Fisherfolk Registration System, she reported there are over 800,000 fisherfolk engaged in capture fishing. “That is nearly half of the 1.7 million registered fisherfolk across the country, almost a million people dependent on sardines and other fish for their everyday living,” Morales said. Filipinos, she said, consume around 2.6 grams of sardine a day, or almost a kilo a year. “Certainly, with the affordability and abundance of sardines, the industry is one of the fisheries subsectors that can help us achieve our food-security goals,” she pointed out. Through the BFAR, the government wants to keep the sardine resource at a healthy and ecologically sound number, she said.

Sardines at a fishport in Estancia, Iloilo Oceana Philippines

Undervalued

While sardines are one of the most economically important fish, they are also the most undervalued fish in the planet. Because they are very affordable, Ingles said, in Malaysia, where he worked for a time, tons of sardines are used as fertilizer in palm-oil plantations. “ Pa l m- oi l pl a nt at ion s u se sardines as fertilizers. Tons of these fish are caught ever y day, hauled off and dumped in palmoil plantations to fertilize the soil,” he said. In the Philippines fresh or processed, including smoked sardines or tinapa, sardines are commonly served as a pantawid-gutom for the tens of thousands of families with limited budget. Sardines are also used as main ingredients of some popular condiments, such as fish sauce, or bagoong and patis, an industry that provides jobs and livelihood opportunities in support of the fisheries sector, by producing these important fish by-products.

Major sardine species

The Philippines is blessed with a diverse species of sardines. In fact, the Sardinella tawilis, a freshwater sardine, is exclusively found in Taal Lake. Sardinella is the diminutive of the Greek sarda, meaning literally “little sardine”. Ideally, a sardine is caught upon the age of maturity, which is between four months to 1 year, Flores said. Spawning of sardines happens from October to December and February to September. There are six major species of sardine in the Philippines, said Jimely Flores, senior marine scientist of Oceana Philippines. They are Sardinella lemuru, Sardinela gibbosa, Sardinella fimbriata, Dussumieeria acuta, Amblygaster sirm and Sardinella albella. Sardine species are called by different names: tamban, tuloyu, tunsoy, law-law, turay, tabagak, manamsi and dilat.

Climate-change effect

Sardines’ life cycle is impacted by climate change. Besides unsustainable fishing practices, the change in weather pattern, the intensifying typhoons and increase in ocean temperature

could cause the extinction of a lot of fish species, including sardines, Flores said. An initial study conducted by Oceana revealed sardine production has changed over the last decade. In 2004 Palawan was the top producer of sardines, with close to 15,000 tons annual production based on a survey in fish landings by the PSA. Zamboanga del Norte comes next with an annual production of about 10,000 tons. Other top producers are Zamboanga City, Masbate, Tawi-Tawi, Iloilo, Negros Occidental, Sorsogon, Misamis Oriental and Camarines Sur. In 2014 Palawan’s annual sardine production was overtaken by Zamboanga del Norte, with a record production of over 20,000 MT. Palawan produced less than 10,000 tons. Masbate, Sorsogon, I loi lo, Zamboanga City, Negros Occidental, Tawi-Tawi, Misamis Oriental and Camarines Sur are still among the top 10 producers. Flores said, surprisingly, Manila Bay has been found to have abundant sardine stock, along with the fishing grounds of Quezon, Bicol and Northern Samar; the Visayan Sea, Northern Sulu Sea, South Sulu Sea and Palawan. A more thorough study on the biology of sardines and the effect of climate change is apparently needed to better understand and come up with ways to protect these lowly fish against threats that could lead to devastating economic impact. According to R amos, while there appears to be an increasing trend in the production of sardines since 2000, telltale signs of overfishing of many local stocks cannot be ignored. While she said the closed season over the past five years has been successfully implemented in the Visayan Sea, Tañon Strait and Zamboanga, policies need to be enhanced and strictly enforced. “Closed seasons are not enough. Additional management tools under the amended Fisheries Code are needed,” she said. Oceana believes that by adopting a science-based strategy, local sardines will continue to thrive, support other marine wildlife and feed the world at the same time.

Biodiversity Monday BusinessMirror

Asean Champions of Biodiversity Media Category 2014

Monday, April 10, 2017 A13

Editor: Lyn Resurreccion • www.businessmirror.com.ph

Asean to recognize biodiversity defenders

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By Lilay Castillo

n February 2017 a critically endangered orangutan was shot, chopped to pieces, and eaten by palm-oil plantation workers in Indonesia’s Kapuas Hulu district. The police arrested three workers after finding orangutan meat and bones in their cupboard.

Froi Rivera

A few years back, a farmer from Impasug-ong, Bukidnon, shot and killed a Philippine Eagle, known as Kagsabua. He made tinola out of one of the world’s largest, tallest and rarest eagles. Kagsabua was one of the remaining 800 Philippine eagles when he was shot in 2008. The farmer claimed he did not know that the Philippine Eagle is a critically endangered species. He has since been sentenced to six years in prison for killing the eagle. In 2014 fishermen in China’s Fujian province hunted and captured a whale shark. They told the police they thought it was a sea monster. These are just some of many reported stories on crimes against biodiversity committed by people who claim ignorance of the endangered species and the law. “It is unfortunate that, despite local, regional and global efforts to communicate the importance of endangered species and biodiversity, in general, there remains a huge communication gap between biodiversity experts and the general public,” said lawyer Roberto V. Oliva, executive director of the Asean Centre for Biodiversity (ACB).

Awareness rising, but more work needs to be done

What is biodiversity? Ask people what they think it means, and chances are only a few can accurately define it. Fewer still can explain its significance to human survival. The immense communication gap between the biodiversityconser vation communit y and the general public is a major factor hampering efforts to achieve biodiversity-conservation goals in the Asean region and elsewhere in the world. Recent surveys show that midway into the 10-year timeframe of the Aichi Targets, there is still a long way to go in terms of making a wider audience understand the economic, environmental and social impacts of biodiversity. The Aichi Targets are 20 measurable targets for the conservation and sustainable use of biodiversity agreed upon by the parties to the Convention on Biological Diversity (CBD) in Nagoya, Japan, in 2010. The 2015 edition of the annual Biodiversity Barometer conducted by the Union for Ethical BioTrade shows that between 2009 and 2015, biodiversity awareness

Saravut Learning

increased from 56 percent to 64 percent in France, Germany, the United Kingdom and the United States. In India awareness grew from 19 percent to 40 percent. In Brazil the awareness level dropped marginally since 2010. In the 2015 survey, which involved 9,000 persons from Brazil, Ecuador, France, Germany, India, Mexico, the Netherlands, the UK and the US, an average of 69 percent of respondents said they have heard of biodiversity. Howe ver, des pite i nc rea si ng awareness, especially among the millennials, greater outreach efforts are needed to meet the global target on awareness. In Southeast Asia a biodiversity-awareness survey conducted by ACB among media practitioners shows that, while reporters and editors have heard of biodiversity, they see the need to understand it better so they can report on the topic. They confirm that there is limited reportage on biodiversity, and attribute this to the fact that it is not seen as a priority topic. Complicating the situation is the lack of understanding of the topic. One editor mentioned the difficulty that laypersons face in understanding jargon. According to the executive director of a Philippine media organization, “Some terms need to be laymanized, so that it is easier to relay the data and information to the public”. A reporter from the Philippines said there is a need to “ bring the conservation down a bit”.

Achieving Aichi Target 1

As parties to the CBD, Asean member-states are committed to strengthening biodiversityconservation efforts by promoting understanding of the importance of biodiversity through public awareness and education programs. Aichi Target No. 1, in particular, states that “ by 2020, at the latest, people are aware of the values of biodiversity and the steps they can take to conserve and use it sustainably”. In a statement read at the 13th Meeting of the Conference of the Parties to the CBD (COP 13), Asean member-states committed to enhance their actions to implement national and regional communication, education and public awareness strategies, including engagement with the public and private sectors, local communities, youth and women, to achieve

Mangrove planting Green Community

Aichi Biodiversity Target 1. This commitment is operationalized through Asean memberstates’ Cepa programs under their National Biodiversity Strategies and Action Plans. An assessment conducted by the ACB in 2016 of Asean member-states’ progress vis-à-vis the Aichi Targets shows that in terms of Target 1, at least half of the 10 countries have reported that they have mobilized necessary actions. While the assessment points to noteworthy progress, there are actions that must be taken to bridge the communication gap. One important step identified by the ACB to bridge the gap is the selection of heroes or champions to represent the conservation sector.

Wanted: Defenders of biodiversity

To boost awareness for biodiversity conser vation, Asean will recognize 10 Asean Biodiversity Heroes during its 50th anniversary on August 8. The awards ceremony will be held in Manila, Philippines. The Asean Biodiversity Heroes is designed to highlight the outstanding contributions of 10 individuals from Asean in the area of biodiversity conservation and advocacy. “The Asean Biodiversity Heroes are individuals whom people can identify with and will inspire others to take action for biodiversity in their own spheres of influence. As Asean member-states continue to work on national

development and sustainability goals, and collaborate on regional initiatives to conserve Asean’s shared natural wealth, Asean Biodiversity Heroes play the crucial role of spreading awareness for the urgent need to conserve biodiversity,” Asean Secretary-General Le Luong Minh said. He added efforts to generate a greater awareness for biodiversity conservation help the region move closer toward achieving the Asean Community Vision 2025, a framework for community building and cooperation to attain common goals and aspirations for a politically cohesive, economically integrated and socially responsible Asean. “We are looking for defenders of biodiversity. These heroes may be forest rangers, researchers, pa rk ma nagers, t a xono mists, biodiversity informationmanagement specialists, media practitioners, scientists, biodiversity policy-makers, academics, conservation workers and other individuals—young and old—working in the biodiversity-conservation arena. They are silent heroes devoting themselves to the survival of humanity,” ACB Executive Director Atty. Roberto V. Oliva said. The awards are supported by the Philippines’s Department of Foreign Affairs (DFA), the European Union (EU), through Biodiversity Conservation and Management of Protected Areas in Asean (BCAMP) project, and the Hari Foundation Inc. (HFI). The

ACB serves as awards secretariat. “The Philippine government, through the DFA, supports the Asean Biodiversity Heroes,” DFAOffice of Asean Affairs Assistant Secretary Hellen B. de la Vega said. “Biodiversity protection and conservation is essential in sustainable economic development, a healthy environment and food security in the region.” De la Vega also explained that the Biodiversity Heroes from all 10 Asean member-states would serve as role models for Asean peoples to work together in the conservation and sustainable management of Asean’s biological resources to contribute to the region’s improved quality of life. She underscored that ACB’s t i me ly recog n it ion of A sea n Biodiversity Heroes during the Golden Anniversar y of Asean is a way to raise consciousness of the public on promoting and protecting the region’s natural resources, while encouraging them to engage in Asean’s community-building activities. The EU expressed pride in supporting the Asean Biodiversity Heroes through the BCAMP. As a global actor and an important development partner to the Asean, the EU has a considerable interest in biodiversity conservation in the region. Biodiversity supports livelihood, enhances food security, nutrition and health, and contributes to climate-change adaptation and mitigation. As the Asean region is home to key major ecosystems with an astonishing

18 percent of all living species on the planet, the EU remains an important partner involved in the protection of this biodiversity. The EU directly contributes at a regional level by funding BCAMP with a total support of P540 million (€10 million). The aim of the project is to improve the management of protected areas in the Asean; to develop and mobi lize k nowledge and scientific basis for biodiversity conser vation; to mainstream biodiversity into the education system; and to strengthen the regional capacities. In the business sector, a keen supporter of the Heroes is the HFI, the corporate social responsibility arm of Hyundai Asia Resources Inc. (Hari). “The HFI envisions the building of a climate-change adaptive and resilient nation by educating, mobilizing and empowering individuals and communities. Preserving the biodiversity of our ecosystem is crucial in addressing climate-change issues,” said Ma. Fe Perez-Agudo, president of the HFI and president and CEO of Hari. She added, “The Asean Biodiversity Heroes is our pioneering platform for spreading the word about the importance of preserving and sustaining the wealth of biodiversity in our region. By recognizing these biodiversity warriors, we inspire more people to join hands and spark a regional movement that will involve the business sector and various non-governmental bodies to intensify the clamor and facilitate shifts in governance and business strategies to align Asean with the global movement to save our planet.” Each Asean Biodiversity Hero shall receive a cash prize worth $5,000, a special heroes medal and a certificate. They will also receive special prizes from Hari. The heroes from the 10 Asean member-states will be also be known as the faces of biodiversity conservation in the Asean region. The Asean Biodiversity Heroes is one of the Asean region’s contributions to the celebration of the United Nations Decade on Biodiversity 2011-2020—an excellent opportunity to increase public awareness of the values of biodiversity and promote actions at the national, regional and local levels to conserve and sustainably manage the world’s rich natural heritage.

A14 Monday, April 10, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Not a Holy Week reflection

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round this time every year, as we enter Holy Week, we are called to reflect on the meaning of what we are celebrating. More than 1 billion followers of Christianity worldwide are asked to remember and contemplate the story of the final days of Jesus of Nazareth. We are expected to be both humbled and uplifted by the account of a man who makes the ultimate sacrifice. But the religious message of faith does not come until days later on Easter Sunday. On Good Friday Jesus of Nazareth is like billions of other people living their ordinary day-to-day lives. When we observe the world and the events unfolding before our eyes, it is difficult to see any goodness, which makes the Holy Week story more significant. But that is not necessarily true. The soldier that falls on the hand grenade or holds a position to death to defend his comrades performs a noble act but is not extraordinary. People make incredible sacrifices every single day. In the recent terrorist attack in Saint Petersburg, Russia, a mother dies protecting her adult daughter from the bomb blast. Less dramatic but just as significant as the poor mother who gives up her food so that her children might not go to bed hungry. The father that works an extra job to provide money to send his children to school is no less righteous than any martyr. We are taught that Jesus was condemned to death and executed for a crime that he did not commit. What a terrible situation for any man to have to suffer. Yet, in some ways, it is no less dreadful than the government employee who fights to resist the temptation of graft and corruption while seeing his or her workmates driving their new ill-gotten cars. The official who puts the interests of his or her constituents first and then is defeated in an election by someone who is corrupt must not feel any differently than the disciple hearing the cries of “Give us Barabbas” from the crowd. The Good Friday lesson is not about an extraordinary man doing something extraordinary. It is about an ordinary man doing something that only seems extraordinary. We have all heard the story of the firefighter who runs into a burning building to save another or the woman who fights a rabid dog to protect a child. They all seem to say the same thing. “I am not a hero. I just had to do the right thing”. In 2017 standing up to evil or doing the right thing can itself be an incredible sacrifice. Did Jesus, on his walk to Calvary, ever think, “Why am I doing this? If I confess my “crime”, I can sleep in my own bed tonight”. Holy Week honors an event of 2,000 years ago. Yet, we should remember and praise the sacrifices of the good men and women that we see every day. Without them, Jesus of Nazareth hanging on the tree would truly have been in vain. Since 2005

5-6 and the new P3 Program Atty. Jose Ferdinand M. Rojas II

RISING SUN

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N the Philippines we know that there is quite a number of people who take loans from loan sharks and illegal loan operators. They charge such oppressive interests that the small people, who are usually their patrons, end up buried in so much debt. The most common is the 5-6 loan at 20-percent interest. The government has now expressed concern about this and has started to address the issue. Illegal loan operators can be arrested, according to authorities, without the need for a warrant of arrest.

Just to put some things into context: Those who borrow from these sources use the money for their small business or livelihood, or for personal expenses, like food allowance, tuition fees, or utilities. Usually, these people don’t have access to other forms of credit, like bank loans and credit cards. In other words, they accept the high interest rates because there is no other choice. The Department of Trade and

‘Magnet Man’

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Industry (DTI) saw the financial needs of the small entrepreneurs: the sari-sari store, the carinderia and the computer-shop owners, for example. Owners of micro, small and medium enterprises (MSMEs), who may or may not have access to adequate credit from banks, can now avail themselves of the government program called P3, or Pondo sa Pagbabago at Pag-asenso Program. Aside from helping entrepreneurs, it

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eaders worthy of emulation make any working environment a happy place to the extent that outsiders are “magnetized” to join him. Recruitment experts say the best talent magnet is not your Human Resources Manager or a skilled headhunter but the head of the organization. In US sports, most athletes join teams due to the financial package, while others, especially those who stay longer in their teams, join because of their attraction to the leader, who is either the owner, the manager, or the coach. In his leadership book, author and inspirational speaker John Maxwell believes that once the leader develops trust in terms of competence, connection and character, his admirers will follow him. Maxwell cited the example of prophets Elijah and Elisha, wherein both were magnetized to each other by mutual attraction and mutual commitment. Christian blogger Kim Sullivan shared her insights in the lessons found in mentorship story of the prophets Elijah and Elisha. Upon the proposition of Elijah, Elisha gave up his day job to follow Prophet Elijah as his assistant. In 1 Kings 19:21, the Bible narrates: “So Elisha returned to his oxen and slaughtered them. He used the wood from the plow to build a fire to roast their flesh. He passed around the meat to the townspeople, and they all ate. Then he went with Elijah as his assistant”. Sullivan says a protégé must focus on the mentor, observe his habits, and hopefully, learn from his faults. For six years, Elisha served Elijah and, despite being told three times to

leave him, Elisha opted to stay behind to have a closer and more personal view of what his mentor was doing. Sullivan further narrated that a protégé must be “willing to stay close to a mentor even when remaining is difficult” and must wait patiently until the appointed time to take over. In his Law of Buy-In, John Maxwell said people are attracted to their leader because of the leader’s Attraction Quotient (AQ), which is composed of seven traits, namely, Calling, Insight, Charisma, Talent, Ability, Communication Skills and Character. Let me focus on one of the more important ingredient in developing one’s AQ, which is calling. In his best-selling book,

also aims to discourage more people from going to the loan sharks or 5-6 lending operators. The program has P1-billion budget that will be lent out to borrowers at only 20-percent interest per year. According the DTI, it will be piloted in Mindoro, Sarangani and Leyte—places that are among the 30 poorest provinces in the country. The project was started in March this year. MSMEs make up about 90 percent of the businesses operating in the country today. These entrepreneurs need all the financial help they can get to grow their businesses. With the government’s P3 Program, I am hoping that there will be less people who will desperately take loans from the 5-6 lenders, which will just push them deeper in debt and put them in a more difficult place, economically speaking. The P3 Program is just one of the many sources of funds for MSMEs. Micro-financing is also available from banks, cooperatives and nongovernment organizations. The Bangko Sentral ng Pilipinas (BSP) supports programs for the small

entrepreneurs by regulating these activities through circulars that would allow MSMEs to gain easier access to funds. n n n ON February 5 the first ChineseFilipino Friendship Race or the Philippine Charity Sweepstakes Office (PCSO)-sponsored Manila Chamber of Trade and Commerce Race was held at the Manila Jockey Club Inc. in Carmona, Cavite. Finishing first was Marinx (jockey-JG Serrano), followed by King Bull (jockey-JB Hernandez). Third placer was Lollipop (jockey-JB Cordova), and Hook Shot (jockey-RO Niu, Jr.) ended up in fourth place. Some weeks later, on March 18, the PCSO Special Maiden Race was held in San Lazaro Leisure and Business Park, also in Carmona, Cavite. Finishing strong in first place was Manda (jockey-JB Hernandez), followed by Great Wall (jockey-OP Cortez), and finally, Absolute Winner (jockey-Val R Dilema) and Janders (jockey-MA Alvarez) both finished at the same time and landed in third place. Congratulations to all the winners of these races!

Ordering Your Private World, author Gordon MacDonald said “called” leaders, in the pursuit of making the company better in terms of profits, still manage to find time to discover the human being concealed under the employee uniform. Since called, persons move with a higher and unwavering purpose, they persevere and understand the true meaning of stewardship. They understand that they only “manage” and not “own” both the company they lead and the employees they give orders to. They are mentors, ready and willing to be replaced at the precise moment. One “called” person close to our family is a departed friend, Kay Sham, whose business include the importation and distribution of athletic shoes and equipment. During his lifetime, Kay looked after the welfare of his employees that the employee retention rate after five years is close to a hundred percent. I remember “Magnet Man” Kay telling me that happy employees never leave their companies. They stick to you like glue, he said. Hardly anyone left Kay and his company, as Kay never took shortcuts or irregular transactions even though they will benefit the company. But more important, Kay understood that he never “owned” the company. He realized that time will come that he has to let go and let his successor take charge. Way before his death, more than a year ago due to a lingering illness, Kay has turned over the business to his children, particularly to my friend

Anil Buxani. The mentorship story of Kay and Anil, similar to the Elijah and Elisha story, exemplified the attribute of being “called” as temporary shepherds of their flock in Sonak Inc. They might legally own the company but they still acted as managers and not owners. Some might think that it is the job of the teacher to shadow the student, but the Bible reveals that Elisha’s success was found in the apprentice Elisha’s relentless pursuit of his mentor Elijah. Being coached by another can be difficult, especially under Kay Sham, whose dogged determination in life can have a negative impact on others. But not on Anil. Anil would sometimes tell me, but never complain, that his father Kay kept on asking him to do the harder things. But despite the hardships due to the demanding work ethic of his mentor, Anil kept on learning from Kay. And even in his deathbed, Kay taught Anil the value of looking after and loving your employees as a father would do to his children. The reward is boundless for those protégés like Anil who have survived the struggles of learning from a tough loving mentor. Kay never left Sonak Inc. as Anil continues his father’s legacy. In the words of the poet Rumi, “Good-byes are only for those who love with their eyes. Because for those who love with their heart and soul, there is no such thing as separation.” A servant leader like Kay never gets separated from his flock; his spirit is glued like magnet to the hearts of those he took care of.

Opinion BusinessMirror

opinion@businessmirror.com.ph

Improving disclosures on corrupt practices

Popularizing PPPs: PPP Menu by Casa Agra and PPP 101 AVP By Alberto Agra

PPP Lead

Filbert Tsai

DEBIT CREDIT

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urbing corrupt practices in the government requires significant political will and governance mechanisms to allow transparency in financial disclosures of individual government personnel. Current laws in the Philippines require the annual filing of government official’s Statement of Assets, Liabilities and Net Worth (SALN) under Republic Act 6713. However, these filed statements are not subject to annual audit though readily available for inspection. Corporations are subjected to annual audit inspection by independent auditing firms to provide reasonable comfort for the corporation’s stakeholders. The risk of misreporting for private companies is likely similar to the risks of misrepresentation by public officials preparing their SALNs. This raises the question of whether current practice of self-certification is enough for fiscal financial transparency. There are several articles written indicating that increasing government employees’ salaries (e.g., Singapore) or the “Name and Fame” scheme (e.g., Nepal) can effectively curb corruption — however, local adaptation would need to be taken for these to become effective. While requiring annual audit inspection for public official’s SALNs are uncalled for, there are easy actions which could be taken from the private-sector perspective to improve financial transparency of government officials. Current local regulations in the country do not require the disclosure of political donations. These items are considerably small or immaterial from the perspective of the private entity, but can result to massive influence to public officials. Donations, in monies or in kind, should be included as a disclosure in the financial statements regardless of its amount. This disclosure requirement is not new as it is required under the Companies Act 2006 (United Kingdom) as part of the Director’s Report. This additional disclosure can be interesting as it is part of the information being audited by the private-sector company’s auditors. The proposal of this additional disclosure provides comfort in twofolds: (1) As a crosscheck to the amounts declared in the public official’s SALN; and (2) As a statement of fact that is covered by management’s and auditor’s reporting responsibility. Facilitation payments are fundamental part of the country’s business operations in order to have a “smoother” transaction with the

Current local regulations in the country do not require the disclosure of political donations. These items are considerably small or immaterial from the perspective of the private entity, but can result to massive influence to public officials. Donations, in monies or in kind, should be included as a disclosure in the financial statements regardless of its amount. government agencies. While these payments are conceptually so small to be disclosed, the backing of a legal requirement to disclose the total amounts per agency of facilitation payments can help in improving fiscal governance. These disclosures can potentially be detrimental to a company’s future business transaction with the related agencies. Therefore, utmost care and confidentiality should be kept in these types of disclosures. Currently there are no transparency platforms in the country that allows anonymous submission of a legitimate complaint (though it seems something is on its way) — this reporting could help curb transaction level corruption at individual bureaus. Fighting corruption is a long struggle for any country striving to grow beyond the shadows of illicit practices limiting national development. While more actions can be taken, baby steps will need to be taken before throwing in the net to catch these morons. Filbert Tsai is a Filipino accounting advisor in the United Kingdom with global and public-sector experience. His key areas of interests are start-ups and micro, small and medium enterprises. His blog and page, Ask the Accounting Advisor, provide relevant insight for start-ups and MSMEs in the Philippines. This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.

Continued from A1 n We (should) all want the same thing. We all want a comfortable life. We all want quality of life better than what we enjoy today. We must want these also for others. PPPs are geared toward these goals. This is at the heart or, rather, the heart of PPPs. n We must be part of the engagement. Since PPPs must serve our interest, then we must be part of the solution and not just wait. The solution does not only lie with

those in power, the formal leaders, the experts and the learned. Clients when dealing with lawyers, patients when consulting their physicians, students when attending class and the public when being served by public officials are and should not be treated as passive fence sitters or tabula rasa (blank slate). Real change only happens only if we all part of the solution. We cannot be part of the solution if we are not empowered by knowledge. n Learn. Unlearn. Relearn. Innovation, new thinking, goal-

DIPLOMASIA

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ad news sells. So, expect most reports and commentary about last week’s banner news out of Syria and Florida to highlight the worrisome stuff, not the cheery.

This article fills a bit of the gap between the two, and not just for journalistic balance. Bad news can make whole nations do things that give one another more reason to get fearful and fidgety. And that can cause even worse news, like war. Take President Duterte’s announcement last Thursday that he ordered troops to occupy “about nine or 10” uninhabited islands in maritime areas controlled by the Philippines. That prompted fears of a rush among rival claimants to take over and fortify reefs and shoals, possibly triggering conflict. Thankfully, the Armed Forces

of the Philippines clarified that the President’s order was to beef up facilities on islands already occupied by the AFP. No race for uninhabited outcrops, we hope and, more important, no escalation in force deployment— exactly the preemptive action that may bring on the very troubles we wish to preempt.

Is there a good way forward for Syria?

Duterte mouthing off about taking over empty islands is one thing, but “the Donald” sending American planes and ships to put 59 warheads into Syria’s Shayrat air base accused

oriented systems and peoplecentered leadership require all stakeholders—us—to go through this cycle of learning, unlearning and relearning. One of things we all have to learn is to accept the fact that we all should learn about PPPs. Another would be to know the different modalities and the manner by which private proponents should be selected. We must also unlearn the notion that PPP is confined to the modalities under the build-operate-transfer law. There is more to PPPs than this law. We must relearn to learn and work together. This is the PPP Learning Ecology. n Columnist’s contribution. Since his prior stint in the government, this columnist has contributed to this learning environment. He has developed a PPP template ordinance for local government units (LGUs).

His template has been referred to by some 70 LGUs, including all the barangays of Bataan Province. In 2017 he has conducted 50 seminars and briefings on PPP before publicand private-sector audiences. n Two education materials. On the occasion of his birthday last week, he launched two education materials that seek to popularize PPPs. The PPP Menu of Casa Agra contains 25 PPP options—modalities, projects, selection procedures, contributions, risks, and bidding parameters, among others. The Agra PPP 101 AVP, viewable in YouTube, instructs us in 11 minutes about the basic aspects of PPPs in the Philippines. All these are readily downloadable in his web site www. albertocagra.com. He hopes that with this menu and AVP, PPP knowledge will be demonopolized. PPP learning is for all.

The lawyer’s duties to the legal profession Atty. Lorna Patajo-Kapunan

legally speaking

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ttorney” is not only a title—it is a responsibility. “As officers of the court, lawyers must not only, in fact, be of good moral character but must also be seen to be of good moral character in leading lives in accordance with the highest moral standards of the community. More specifically, a member of the bar and officer of the court is not only required to refrain from adulterous relationship or the keeping of mistresses [Toledo v. Toledo, 75 SCRA 747 (1963)] but must also behave himself as to avoid scandalizing the public by creating the belief that he is flouting those moral standards” (Tolosa v. Cargo, 171 SCRA 21 [1989]). A lawyer shall always conduct himself ethically and morally. The best way a lawyer can uphold the integrity and dignity of the legal profession is not to engage in any conduct or do any act that adversely reflects on his fitness to practice law, nor to behave, in his public or private life, in a scandalous manner to the discredit of the legal profession (Rule 17.03, Code of Professional Responsibility). He should instead endeavor to conduct himself at all times in such a way as to give credit to the legal profession and to inspire the confidence, respect and trust of his clients and the community. (Comments of IBP Committee that drafted the Code, p. 37) It is a fair characterization of the lawyer’s responsibility in our society that he stands “as a shield” in the defense of rights and to ward off wrong. From the profession charged with these responsibilities there must be expected those qualities of truth speaking, of a high sense of honor, of granite discretion, of the strictest

observance of fiduciary responsibility, that have throughout the centuries been compendiously described as “moral character” (Ibid, p. 37). Some lawyers have taken the forbidden path and, as a consequence, have been disciplined or deprived of their privilege to practice law. Among those acts that adversely reflect on the lawyer’s fitness to practice law, which justify suspension from practice or disbarment include gross immorality. Gross immorality is reflective of unfitness to practice. An act of personal immorality on the part of a lawyer in his private relation with the opposite sex may put his moral character in doubt. However, to justify suspension or disbarment, the act must not only be immoral; it must be grossly immoral as well. A grossly immoral act is one that is so corrupt and false as to constitute a criminal act or so unprincipled or disgraceful as to be reprehensible to a high degree. It has been held that a lawyer is guilty of gross immorality,

What can go right after Syria and Florida Ricardo Saludo

Monday, April 10, 2017 A15

of gassing the rebel Khan Shekhoun town, is quite another. The US attack last Friday, with threats of more bombings, stirred fears of military responses from Syrian President Bashar al-Assad and his backers in Tehran and Moscow, risking battles between their forces and Washington’s. The day after the American attack, bombs again hit Khan Shekhoun; it was not immediately clear which forces mounted the attack. Russia said it would strengthen Syrian air defenses, and sent a missile frigate sailing to Syria’s Tartus logistics base on the Mediterranean. What good can come out of this? Russia and Iran will not back down in their support for Assad, pretty much the only major head of state in the Middle East under their sway. President Donald J. Trump may repeat his Friday bombing, especially with Syrian forces seemingly undeterred. So, what was already an alarming array of rival forces in Syria even before last week’s attacks, looks set to escalate, making everyone even more fearful and fidgetty.

The US attack last Friday, with threats of more bombings, stirred fears of military responses from Syrian President Bashar al-Assad and his backers in Tehran and Moscow, risking battles between their forces and Washington’s. Big question: Will there be Gulf War 3, pitting America against Russia? Not so fast. Russian President Vladimir Putin has more on his mind than just propping up Assad and building up a Middle East sphere of influence. His ultimate aim is global power, and warming ties with Trump may be Russia’s best bet for a spot at the top. If they can make a deal for Middle East peace under American and Russian power, that’s far better than a war sure to set back Russia’s rise. The way forward may be a Syrian truce with areas of control for Assad and the rebels, except Islamic State, which should be eradicated.

which justifies denial of his application to take the lawyer’s oath or, after his admission, his suspension or disbarment, where he lives an adulterous life with a married woman (Cordova v. Cordova, 179 SCRA 837 [1989]), or abandons his lawful wife to live with another woman (Obusan v. Obusan, 128 SCRA 485 [1984]). On the other hand, it has also been held that mere intimacy between a man and a woman, either of whom possesses no legal impediment to marry, voluntarily carried on and devoid of any deceit on the part of the lawyer, is neither so corrupt nor so unprincipled as to warrant imposition of disciplinary sanction against him as a member of the bar, even if as a result of such relationship the woman gave birth to a child, and so long as he admits the paternity of, and agrees to support, such child. He may be disciplined if he subsequently disowns, or refuses to support the child (Marcayda v. Mari Wang, 106 SCRA 591 [1981]). Lawyers as guardians of the law play a vital role in the preservation of society. The fulfillment of this role requires an understanding by lawyers of their relationship with and function in our legal system. A consequent obligation of lawyers is to maintain the highest standards of ethical conduct. Canon 7 provides that, “A lawyer shall at all times uphold the integrity and dignity of the legal profession...” In fulfilling his professional responsibilities, a lawyer necessarily assumes various roles that require the performance of many difficult tasks. Not every situation that he may encounter can be foreseen, but fundamental ethical principles are always present to guide him. Within

the framework of these principles, a lawyer must with courage and foresight be able and ready to shape the body of the law to the ever-changing relationship of society. The Code of Professional Responsibility points the way to the aspiring and provides standards by which to judge the transgressor. Each lawyer must find within his own conscience the touchstone against which to test the extent to which his actions should rise above minimum standards. But in the last analysis it is the desire for the respect and confidence of the members of his profession and of the society which he serves that should provide to a lawyer the incentive for the highest possible degree of ethical conduct. The possible loss of that respect and confidence is the ultimate sanction. So long as its practitioners are guided by these principles, the law will continue to be a noble profession. This is its greatness and its strength, which permit of no compromise. To say that “all lawyers are womanizers” or that “all lawyers are not faithful” is not only making false statements, but is irresponsible and improper conduct, eroding public confidence in law and lawyers. Lawyers cannot be effective instruments in the proper administration of justice if respect for the legal profession is diminished by public ridicule and condemnation of all lawyers. For indeed, the bar can only be as reputable as its members. Thus, every lawyer (and that includes the Speaker of the House and the President) should act and comport himself in such a manner that would promote public confidence in the integrity of the legal profession.

No way for such a deal? Before last week, Trump didn’t care to flex muscle abroad. If there’s a lesson from last week, it’s this: Nothing’s off the table, not even pipe dreams.

built a trust—a preliminary working relationship and friendship.” China reportedly pledged to invest in the US to create 700,000 jobs, as Japanese Prime Minister Shinzo Abe promised Trump. Xi urged the US to participate in China’s massive One Belt, One Road infrastructure plan for Asia, and lauded military exchanges between the two powers. What about North Korea? Over the weekend, a US official told Reuters that a naval strike group was sailing to waters near Korea, giving credence to Trump’s warning that if Beijing did not cooperate to rein in Pyongyang, the Americans would go it alone. That could mean a US attack on North Korean weapons installations, possibly igniting full-scale war on the peninsula—a disaster for China. Like Putin with Assad, Xi has to ponder how far he would back North Korea’s Kim Jong Un. Here’s betting he’d slap him down rather than risk war with America. Maybe it’s all wishful thinking. But some of that may just be needed, so we don’t succumb completely to negative outcomes.

‘Outstanding’ relations after Florida

AS Syria’s explosions make pessimists sound prescient, it’s a less dour tune amid the clinking of wineglasses at Trump’s summit with China’s Xi Jinping at the billionaire’s Mar-a-Lago resort in Florida last Thursday and Friday. After recent tensions over North Korean nukes and missiles, plus long-standing frictions over trade and Beijing’s maritime assertiveness, few seasoned journalists and analysts would swallow Trump’s post-summit line: “We have made tremendous progress in our relationship with China...lots of very potentially bad problems will be going away.” The former TV reality host spoke of an “outstanding” relationship developed with Xi. The Chinese leader concurred: “We have engaged in deeper understanding, and have

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Tourism chief confirms: ‘See you in MFM 2018’ By Ma. Stella F. Arnaldo

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@akosistellaBM Special to the BusinessMirror

OU just can’t put a great event down. Even before the last dishes had been cleared away and the doors of the SMX Convention Center in Pasay had closed, Tourism Secretary Wanda Corazon T. Teo confirmed that there would be another Madrid Fusión Manila (MFM), this time in 2018. Teo made this disclosure to the BusinessMirror as she went around the regional lunch last Saturday, the final day of MFM 2017, which carried the theme “Towards a Sustainable Gastronomic Planet”. She said: “Yes. For sure we will have Madrid Fusión Manila in 2018. The amount of culinary talent that we have here is just amazing. Many of our young chefs have obviously upped their game, as they have learned more from the new techniques shared by our visiting Michelin-starred chefs.” Saturday’s International Gastronomy Congress began and ended with Filipino chefs talking about their food philosophies and creating dishes of sustainable cuisine. In the morning, Chef Jordy Navarra (Toyo Eatery) paid tribute to creative food talents in the Philippine countryside such as Manang Ernanie Pedronan from Adams, Ilocos Norte, who makes tapuey (fermented rice wine), and fisherman Jhun Fabre from Batanes, who demonstrated on stagehow to debone a dorado fish for salt- and sun-drying.

In an interview later, Navarra said the most interesting yet less discussed facet of Philippine cuisine is its condiments. “Salt varies from one place to another, and each creates a different flavor profile to the dishes we’re creating.” The final speaker at the Congress was Chef Robby Goco (Green Pastures/Cyma) who has partnered with a Tarlac farm to source what he calls the “wagyu of goat”. He explains later that the goats—also of Anglo Nubian breed—are kept in a shelter instead of allowing them to roam freely, and fed both grass and grain, which gives them a white, not yellow, fat. “It’s more tender and not gamey,” he explained, allowing him to uplift the taste of goat dishes from just mere pulutan (appetizers consumed during drinking sprees) to extraordinary fine-dining food. During his presentation on stage, he encouraged more chefs and restaurants to serve goat dishes, to help increase the demand and, eventually, supply of

GLOBAL GATEWAY CLARK SETS THE BAR HIGHER FOR GREEN BUILDING INDUSTRY IN PHL G

reen development has traditionally ranked low on the Philippines’s priority list, but increasing demand from multinational companies is now driving a demand-led surge in LEED-registered buildings. LEED, short for Leadership in Energy and Environmental Design, is a green building certification used worldwide that is also now gaining traction in the Philippines. Across the country, more real-estate developers are adopting environment-friendly practices in commercial, industrial and residential projects. At present, there are 245 LEED activities in the country, with 61 projects having already obtained certification. More will soon be joining the likes of Zuellig Building in reaching the highest standards of environmental-friendly construction. Located in the financial center of Makati City, Zuellig Building was the first in the Philippines, and among the first buildings in Asia, to be Platinum-certified under the LEED program. Just north of Manila in Clark Freeport Zone, a new city—Global Gateway Clark—is under construction that will eventually cater to 500,000 workers. Currently, One West and Two West office towers have been precertified gold and these buildings, along with a further three office towers, which are scheduled for construction later this year, are targeting a postcompletion certification of Platinum status. Another major project—the Clark Green City in Tarlac province—will draw on expertise from the private sector to develop key environment-friendly initiatives. Japanese companies Hitachi Asia and The Power Grid Solution will work with the Bases Conversion and Development Authority to set up an energy management and storage system, a district cooling system, a total energy network system and a private utility company across 23,400 acres that will accommodate over 1 million residents.

The appeal of sustainable development

Such projects are a part of a bigger government vision to lighten the load on the congested National Capital Region and encourage more international companies to set up bases in the country. Clark, which has an interna-

tional airport and connectivity to Manila, is emerging as the best location as the country’s new business hub. Green credentials are becoming more important for new and existing developments if they are to gain traction with an increasingly sustainability-conscious business community, according to Mark Williams, CEO of Global Gateway Development Corp. (GGDC), which owns and operates Global Gateway Clark. The global market for green buildings grew to $260 billion in 2013. According to World Green Building Trends 2016, the percentage of firms anticipating to have over 60 percent of their projects certified green was expected to rise from 18 percent last year to 37 percent by 2018. For the Philippines, going green is essential as it positions itself as a low-cost business hub. “Green certification is much more than applying labels that add a positive image to realestate projects. From a business perspective, these certifications show that the investment has a higher asset value and is recoverable through reduced operating costs and higher return on investments,” Williams said. “While energy savings is a direct advantage, it also has other benefits, such as a greater company marketability and increased employee productivity,” he said.

The future of green in the Philippines

Despite rising awareness and willingness to develop sustainable projects in the Philippines, there is still much to improve regarding commitment, action and government support. That’s not to say there hasn’t been progress in recent years. Aside from LEED, the Philippines also has its green building rating scheme called Building for Ecologically Responsive Design Excellence (BERDE) from the Philippine Green Building Council. The establishment of the domestic rating system, together with the launch of the Green Building Code by the Philippine Department of Public Works and Highways in mid-2015, shows that the Philippines is indeed shifting toward a greener real-estate industry. There are also schemes to reward green initiatives. Quezon City, the largest city in Metro See “Global gateway,” A2

TEO: “For sure we will have Madrid Fusión Manila in 2018. The amount of culinary talent that we have here is just amazing. Many of our young chefs have obviously upped their game.”

goat meat in the country. Goat meat currently sells at P300 a kilo, he noted, which was quite expensive compared to beef (P280/kilo), pork (P200/kilo) and chicken (P150/kilo). Special-themed and regional lunches were hosted by the departments of Agriculture and of Tourism (DOT) for the three-day event. Dishes created by the country’s new and established chefs were offered side by side with delectable options from Via Mare, the country’s longestrunning purveyor of Philippine cuisine, as well as chefs representing Luzon, the Visayas and Mindanao. On April 6 dishes using heirloom rice were featured; followed by nose-to-tail cuisine on April 7; then corn-based creations on April 8. “The past three days have been truly exciting for the gastronomy scene in the Philippines and Asia,” Teo said in her remarks at the closing ceremony of MFM 2017. “For one, we were awed by the superb talents of our chefs who showcased to us unique and delectable servings that not only tingle our senses but also allow us to experience the fusion of various cultures. Two, during the congress, we learned more

James Deakin joins FGen Insurance as new endorser Fortune General (FGen) Insurance, one of the most trusted nonlife-insurance companies in the country today, welcomed automotive journalist and CNN Philippines host James Deakin as its new endorser during the launch of the company’s new campaign, called “FGen4NxtGen”, on Friday, April 7, at the Pahiyas Hall of the Blue Leaf Filipinas in Parañaque City. Shown in the photo are (from left) Deakin with FGen Insurance Chairman and CEO J. Antonio A. Cabangon Jr., and President and COO Michael F. Rellosa. Alysa salen

See “MFM 2018,” A2

BIR seen filing more tax-evasion cases estimated at P30B against Mighty Corp. By Rea Cu

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@ReaCuBM

he Bureau of Internal Revenuet(BIR) will file more complaints at the Department of Justice (DOJ) against local cigarette company Mighty Corp. for the cigarette products bearing fake-tax stamps found in several of its warehouses across the country, according to the Department of Finance (DOF). Finance Secretary Carlos G. Dominguez III said the BIR had filed the first of an expected four or five complaints against Mighty for possession of fake cigarette stamps and untaxed cigarette products. The BIR filed at the DOJ last month a tax-evasion case worth P9.56 billion for the Mighty cigarettes with fake tax stamps found in the company’s warehouses in Pampanga. “We filed a case in one warehouse, where [Mighty] owes us P9 billion. We haven’t filed the cases in the other three warehouses. In every warehouse we raided, 90 percent of the stamps are unpaid,” Dominguez said. The raids conducted by the Bureau of Customs (BOC) and the BIR in the company’s warehouses in Zamboanga, General Santos City, Cebu, Tacloban City and Bulacan also yielded fake tax stamps on cigarette products. The use of fake tax stamps was uncovered during a series of surprise BOC inspections on warehouses belonging to Mighty Corp. Last week Internal Revenue Commissioner Caesar R. Dulay said an estimated P27 billion to P30 billion tax-evasion cases can be filed against Mighty Corp. for the raid done in its warehouses in Bulacan alone, which yielded an estimated P2.4 billion in unpaid taxes. “We’re building up solid cases, that’s our job, so we have to do it. For example, the Bulacan raid yielded three times bigger than the Pampanga warehouse raid. We’re looking at around P27 billion to P30 billion in tax-evasion cases,” Dulay said. According to the BOC, the raided Bulacan warehouses resulted to the seizure of

We filed a case in one warehouse, where [Mighty] owes us P9 billion. We haven’t filed the cases in the other three warehouses. In every warehouse we raided, 90 percent of the stamps are unpaid.”—Dominguez 160,000 master cases of Mighty cigarettes bearing fake tax stamps, the first warehouse contained 145,000 master cases with an estimated value of P2.9 billion, while the second warehouse had 15,000 master cases worth an estimated P300 million. He added the company’s license to operate may be canceled due to numerous violations of the National Internal Revenue Code of 1997. “Yeah, because there’s a violation of the Tax Code, we’re also looking into that,” he added. Meanwhile, customs operatives confiscated 644 boxes of cigarettes manufactured by Mighty Corp. that were suspected of bearing fake stamps in two separate operations last Friday. The operatives first inspected a warehouse of Mighty Corp. where 14 master cases of Mighty and Marvels cigarette brands failed in a taggant test. The 14 boxes were all confiscated and brought to the BOC office. The boxes of cigarettes with fake stamps were found in an office inside the warehouse separate from a bulk of stored cigarettes, which were first tested and found to have genuine stamps. Immediately after confiscating the suspected items, BOC operatives, acting on an intelligence information, rushed to Santa Rita, Samar, and apprehended a van suspected of carrying Mighty products with fake stamps. The van was then about to enter San Juanico Bridge en route to Tacloban, where the cigarettes were supposed to be delivered when it was spotted by BOC operatives. The van was brought to the BOC compound in Tacloban for taggant testing with

representatives of the BIR the following day, Saturday. Taggant testing conducted separately by BOC and BIR representatives on eight randomly selected master cases of cigarettes all showed that the cigarettes were using fake tax stamps. All the 630 master cases of cigarettes in the van were confiscated. BOC inspector Capt. Joenel Pogoy said the operations were conducted based on information received at the central office on the presence of suspicious items. Pogoy said the 644 master cases of cigarettes that were confiscated in the two operations were worth more than P18 million. BIR representatives present determined that excise tax from these cigarettes could amount to at least P9 million. Sharilee Gaspay-Mauro, Mighty Corp., lawyer in Tacloban, questioned the legality of the confiscation done by the BOC team. “I am questioning the authority of the BOC to confiscate because these are locally produced items and not imported items. The BOC has only concern over imported items,” Mauro said. “Actually, the tagging can only be done by the BIR and not by the Bureau of Customs.” But Pogoy said the BOC is authorized by law to investigate since a product with fake stamps could only mean that it is either a counterfeit or a smuggled item. “Our mission is to evaluate and check, so we will take custody of these. We cannot release them to other agencies. We still have to determine the export components of these goods,” he said. With reports from Elmer V. Recuerdo