Businessmirror april 13, 2018

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n Friday, April 13, 2018 Vol. 13 No. 181

Trade deals insulate PHL from effects of trade war

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By Cai U. Ordinario

@cuo_bm

hanks to “alliances” already forged—which come in the form of free-trade agreements (FTA) and preferential access to key markets—the Philippines appears to be insulated from the impact of a United StatesChina trade war.

Manzano: “If everyone decides to increase their tariffs, if it provokes a chain reaction, of course, if you’re a member of an FTA, you’re insulated.”

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Short pain, longer gain Edgardo j. angara

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uch like Boracay, several favorite tourist destinations in other countries were shut down by their government due to polluted waters, overcrowding, or untreated waste

National Economic and Development Authority (Neda) Officer in Charge and Undersecretary for Planning and Policy Rosemarie G. Edillon told the BusinessMirror

disposal. In 2011 Ecuadorian officials enacted new regulations limiting the number of visitors, their length of stay and frequency of landing to the historic Galapagos Islands. Officials opened up previously closed destinations in the small archipelago as a way to redistribute visitors, reduce fuel consumption and limit the overpollution caused by tourism. While the islands house roughly 30,000 locals, some 200,000 tourists visit each year.

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TPB to bring lowly ‘carinderia’ food to the world How the Bill BAN ON OFW DEPLOYMENT TO MIDDLE EAST BETTER KEPT of Rights can AS MERE POSTURING FOR NOW bridge PHL’s T rich-poor gap By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

By Samuel P. Medenilla

ANG: “We cannot do it now since we are still too dependent on the remittances there... we cannot afford it as a country and the government knows this.”

@sam_medenilla

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s the government revives its proposal to ban the deployment of overseas Filipino workers (OFWs) to the Middle East, migration experts warned the country is currently unprepared for such a policy shift. For one, LBS Solutions President Lito Soriano told the BusinessMirror, many of the Philippine recruitment agencies (PRA) still rely on the Middle East for most of their revenues. This is apparent in the latest available data from the Philippine Overseas Employment Administration (POEA), which showed that over half of the 2 million deployed OFWs in 2016 headed to the Middle East. Most, or 460,121, of them were bound for the Kingdom of Saudi Arabia (KSA). Other top destination-countries in the Middle East were the United Arab Emirates (276,278), Qatar (141,304), Kuwait (109,615), Oman (27,579) and Bahrain (21,429). This has been the deployment trend since the last decade. However, this trend is now threatened due to the recent announcement

of the Department of Labor and Employment (DOLE) and the Department of Foreign Affairs (DFA) that the government is now mulling over expanding its deployment ban in Kuwait to other Middle East countries with the rising incidents of OFW maltreatment. The government imposed the deployment ban to Kuwait in February, upon the orders of President Duterte, after the recovery of the remains of Filipino household service worker (HSW) Joanna Demafelis in a freezer at her employer’s home.

Long transition

Soriano said should the government push through with the plan to stop deployment to more Middle East destinations, many recruiters will have to shift their operations to other

PESO exchange rates n US 51.9350

See “Ban,” A2

HE Tourism Promotions Board (TPB) has launched a nationwide culinary project aimed at lifting the status of the perceived lowly carinderia food. In an interview with the BusinessMirror, TPB Officer in Charge, Deputy Chief Operating Office for Marketing and Promotions Maricon B. Ebron said “Buhay Carinderia Redefined” will take place in several regions in the country, which will then culminate in Manila with a food festival and competition in December. “We are going to the regions to teach the LGUs [local government units] how to promote their cuisines, the ingredients available in their localities, and teach them how to prepare their food cleanly,” she said. Speaking on the sidelines of the event launch on Wednesday at the Rizal Park Hotel, Manila, she added that there will be conferences to discuss food topics, feature dishes that are popular in the region and a competition of culinary students using local ingredients. “We will involve the provincial culinary schools,” she stressed. At the culminating event in December, the winners of the re-

By Bernadette D. Nicolas @BNicolasBM

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to elevate the quality of the country’s street food, such that vendors “will be taught proper food handling and sanitation,” to better attract foreign tourists and locals alike to taste these.

o help address the gaping social and economic inequities in the country, members of President Duterte’s consultative committee (Concom) have made known their intention to include the rights to education, decent housing and health in the Bill of Rights of the federal charter they are crafting. This was immediately welcomed by officials of agencies mandated to deliver these basic but largely neglected rights, as they believe their enshrinement in the new charter will compel the government to allocate more funds for their programs. This is also the intention of the Concom, according to its chairman, former Chief Justice Reynato S. Puno. Puno told the BusinessMirror that with this proposal to include these rights in the Bill of Rights, the government will really be compelled to do something to enforce these rights. “Its impact will be the government will be forced to allot

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See “Bill of Rights,” A12

Tourism Secretary Wanda Corazon T. Teo (right) was warmly welcomed by Erlinda Legaspi (left) of Marylindbert International and Alberto Rosal (center) during the launch of the campaign “Buhay Carinderia Redefined” at the Rizal Park Hotel in Manila on Thursday. The project, to be supported by the Department of Tourism for the first time, aims to redefine local eateries throughout the country. ROY DOMINGO

gional competitions will be the brought to Manila for a national challenge. “It will be a competition between the best of the best,” Ebron explained. Through Buhay Carinderia, she said, the government also intends

n japan 0.4864 n UK 73.6490 n HK 6.6162 n CHINA 8.2881 n singapore 39.6783 n australia 40.2704 n EU 64.2384 n SAUDI arabia 13.8497

Source: BSP (12 April 2018 )

BMReports BusinessMirror

A2 Friday, April 13, 2018

Trade deals insulate PHL from effects of trade war Continued from A1

the effects of the escalating trade tussle between the two economic superpowers would be muted by the good ties Manila has with both Beijing and Washington. For instance, Edillon said the US Generalized System of Preferences (GSP) that gives certain Philippine products preferential access to the American market has been extended to December 31, 2020, following the signing of the US Consolidated Appropriations Act last month. The GSP covers about 18 percent of Philippine exports to the US, including nonalcoholic beverages, electrical machinery and equipment parts, or about $1.5 billion worth of exports in 2017. “Our GSP with the US has been extended until 2020. We have good ties with China. [But] we need to diversify products and markets,” Edillon said. The Philippines also enjoys preferential access to European markets via the European Union’s own GSP scheme and the recently ratified FTA with the European Free Trade Association composed of Iceland, Liechtenstein, Norway and Switzerland. For mer Tar iff Commission Chairman George Manzano the Philippines is also insulated because of its membership in the Asean, which has an existing FTA with China. “If everyone decides to increase their tariffs, if it provokes a chain reaction, of course, if you’re a member of an FTA, you’re insulated. The FTA will keep their

markets open for you,” Manzano told the BusinessMirror. Even the World Bank recognizes the importance of alliances, like regional trade agreements, in the face of the impending trade war. In a news briefing via video conference on Thursday, World Bank Chief Economist for the East Asia and the Pacific (EAP) Sudhir Shetty said these trade agreements include the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). “Our argument there is that one of the ways this region can somewhat insulate itself from some of the broader uncertainties around trade policy in the global arena, including what we were just talking about, the threat of a possible trade war between the US and China, would be to deepen integration within existing, within the region itself, as well as with other partners, and it’s with that regard that the RCEP, as well as the possible broadening of the CPTPP to include other countries, could have some protection,” Shetty said. “If a trade war were to arise, obviously it would not be good news for poverty for the reason that it would not be good for growth for the region,” he added. Growth in developing EAP is expected to remain strong and reach 6.3 percent in 2018; 6.1 percent in 2019; and 6 percent in 2020. Excluding China, the EAP region is forecast to grow by 5.4 percent this year and 5.3 percent in 2019 and 2020. In the Asean, growth is seen

to reach 5.4 percent this year until 2020. In the Philippines, the World Bank forecasts a growth of 6.7 in 2018 and 2019, and 6.6 percent in 2020. However, Shetty said these growth estimates are threatened by “heightened uncertainty” caused by the trade war between the US and China, which could “reverse the recent recovery in global trade growth” and “undermine prospects” of the region, which has been considered a major growth driver of the global economy. The World Bank official added that the trade war can even “flame the fans of protectionism in advanced economies.” Edillion said that, while the Philippines is not part of the CPTPP, the country is very active in the RCEP negotiations. As of February, Trade Undersecretary Ceferino S. Rodolfo Jr. said difficulties in concluding the RCEP stemmed from complications among the six non-Asean negotiating countries: Australia, China, India, Japan, New Zealand and South Korea. Rodolfo said some of these countries do not have existing bilateral FTA with each other yet, and this slows down the whole process of finalizing the RCEP. “On the RCEP and CPTPP, I think the idea is we should actively participate in cooperation agreements, and we are,” Edillon said. “We are in the process of negotiating RCEP. I’m not aware of initiatives regarding CPTPP.” Manzano said there is no indication yet whether China will be increasing tariffs only on products

Duterte pivot to Beijing starting to bear fruits Continued from a12

last two years of the administration of former President Benigno S. Aquino III. Now, China has pledged $7.34 billion in loans and grants for various infrastructure projects, including two bridges in the capital, according to the finance department.

Trade

China has been the Philippines’s top trading partner for the past two years, but the trade balance in China’s favor continues to balloon as increasing imports outpace exports growth. China lags behind the US and Japan as an export market for the Philippines, although it is the nation’s top source of

imports. Philippine and Chinese officials aim to balance bilateral trade during Duterte’s six-year term as president.

No long-term deals

The benefits from warming ties with China “are nowhere near as great” as the countries’ officials portray them to be, Gregory Poling, a fellow at the Washington-based Center for Strategic and International Studies, said in an e-mail. He noted loans and grants pledged by China haven’t translated to projects, and said Beijing still trails far behind other trade and investment partners. Socioeconomic Planning Secretary Ernesto M. Pernia said

in February that loan terms from Japan are better than China. Then there’s the estimated 4 trillion cubic feet of natural gas reserves worth billions of dollars that the US Energy Information Administration says could be in South China Sea areas claimed by the Philippines, indicating the benefits of warming ties may be outstripped by potential losses. “When it comes to the most obvious place where relations have shifted—the West Philippine Sea—the two sides are no closer to any long-term deals to manage the disputes than they were two years ago,” Poling said. Bloomberg News

coming from the US or from all countries it trades with, including the Philippines. If the tariff increase will be imposed on all countries, the impact would depend on the products that will be affected. There will also be spillover effects, Manzano added, since most of the country’s exports are not finished goods and may still go through China for value adding before they are sold in markets like the US.

Monetary policy

Apart from the trade war, Shetty warned that the tightening of monetary policy in countries like the US will also make it imperative for central banks in the EAP region to increase interest rates. For the Philippines, Shetty said, this is especially important given the risk of rising inflation. The country’s inflation in March was 4.3 percent, bringing the average inflation rate in the first quarter to 3.8 percent. This is already near the upper end of the Bangko Sentral ng Pilipinas’s inflation target of 2 percent to 4 percent this year until 2022. “If this monetary tightening would be faster than currently anticipated, it could exacerbate vulnerability that may have built up in the financial sectors in these economies, as well as lead to capital outflows,” Shetty said. “In the Philippines, I think, I would just like to reinforce this with a point, which is, we are beginning to see inflation rising in the Philippines, and that would bolster the case for tightening of monetary policy,” he added.

TPB. . .

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She added the region’s respective best practices will be shared, as well as discussions on the availability of local ingredients. It is, likewise, an opportunity for cross-selling of produce and talents. “During this two-day exposition to showcase all the surrounding provinces’ culinary gems, we will also be searching for young individuals who will become our Philippine Tourism Millennial Ambasadors. They should be able to enlighten everyone of their town’s or city’s deep and multicultural food history.” The same event will be replicated in other regions, such as Central Luzon, particularly Pampanga; Bicol region; Western, Eastern and Central Visayas; and the Zamboanga Peninsula, Northern Mindanao, Davao region, Socksargen and Caraga. “The linkages between food and tourism also provide a platform for national but also regional economic development. These days, anyone could notice the focus of many tourists has changed from the class ‘must see’ physical sights, such as natural wonders or monuments toward a ‘must experience’ imperative to consume intangible expressions of culture,” Legaspi stressed. At the launch, A-List celebrity Erwan Heusaff, who is also a blogger and self-styled chef, was introduced as content creator for Buhay Carinderia, a project that targets the general mass population. He is best remembered by avid Youtube viewers as having prepared the favorite Filipino snack food, taho (sweetened soybean curd), using the wrong ingredients and serving it with raw tapioca balls. But Ebron explained the choice: “He’s slowly discovering the assets of the Philippines,” which includes local food ingredients, and dishes. For his part, Heusaff said, “I may not be a Filipino food expert yet; there are so many dishes that I still need to discover. But I’m curious to keep learning, and I am a staunch advocate of our culinary culture.”

Ban. . .

www.businessmirror.com.ph

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regions—most probably Asia. But making the transition will take the PRAs about six months. The Asian region has the secondmost number of OFWs next to the Middle East. In 2016 about 488,615 of the total deployment recorded by POEA were to Asian countries. “Most of the top agencies, which number over a hundred, deploy not only to Kuwait or other Middle East countries, they also deploy to Singapore, Hong Kong, Taiwan and Malaysia,” Soriano said. The recruitment leader, however, pointed out the Asian market may not be able to completely absorb the OFWs to be displaced by the planned Middle East ban—at least for now. However, new markets in Asia like Japan may eventually may make this possible over time. “They [PRAs] are now very active in monitoring the market in Japan as it crafts its new migration policy,” Soriano said. Soriano is referring to the Technical Intern Training Program of Japan, which, labor officials said, as of last year was seen to create at least 100,000 jobs. Also, he said the possibility of Russia and China opening their doors to OFWs, particularly Filipino HSWs, will further help minimize the impact of the possible closure of the Middle East market. Currently, the DOLE said its is interested in negotiating for possible employment opportunities in both countries and is just waiting for their respective governments to relax their policy restrictions for foreign workers before formally initiating such talks.

Financial impact

Ateneo Center for Economic Research and Development Director Alvin P. Ang said another factor to consider before implementing the Middle Eastwide ban is the effect on remittances, particularly since the bulk of the money being remitted by OFWs still comes from the region. “We cannot do it now, since we are still too dependent on the remittances from there [Middle East]...we cannot afford it as a country, and the government knows this,” Ang said. Data from the Bangko Sentral ng Pilipinas showed about a third, or $7.8 billion, of the $28.-billion remittances in 2017 came from the Middle East. Most of the remittances from the Gulf region were from the KSA and UAE, with $2.5 billion each. Ang said a Middle East deployment ban will initially have minimal impact on total remittances, since the estimated 2.4 million Filipinos currently working there will still be able to send money back to the country even with the ban. However, their number will eventually dwindle further over time, as more of them return to the country. Back home, Ang added the families of the affected OFWs would consequently spend less, thus affecting the country’s GDP. “About 10 percent of our GDP comes from remittances.” Ang said the country will remain dependent on OFW remittances until it could generate more local revenues and jobs by developing its other industries, particularly its export sector.

Political pressure

Another deterrent to a long-term deployment ban to the Middle East is its potential impact on the Philippines’s diplomatic relations with the affected countries. Soriano said Arab nations will not allow the ban to happen, since it will affect the flow of needed manpower to their economy. He noted that the KSA, the Gulf country with the most number of OFWs, already preemptively responded to the government pronouncement of imposing more deployment bans by sending one of its senior officials, Saudi Arabian Prince Abdulaziz bin Saud bin Naif, to the country last month. “We were surprised the third-most powerful official [of Saudi] came to talk with the President to assure they are protecting the rights of our workers... this means it [deployment-ban proposal] may have caused a diplomatic movement,” Soriano said. Right after the country’s imposition of a deployment ban to Kuwait, the KSA government released its revised

penalties for Saudi employers who will violate its labor laws. The new policy covers migrant workers. Employment of OFWs has always been a sensitive and important issue in KSA. In 2011 the Saudi government decided to ban the hiring of Filipino HSWs after the Philippine government insisted it should comply with Philippine recruitment standards. Not long after that, the Saudi government initiated negotiations with the Philippine government for the resumption of the deployment of Filipino HSWs due to the clamor of its own citizens. “Domestic workers are among the most resilient markets in the Middle East for recruiters...since many households there are already reliant on their services,” Soriano said. While there are recent attempts from the Saudi government to nationalize some of its occupations, some of its sectors, including medical and household service, still rely heavily on migrant workers. In the case of Kuwait, its government is now rushing compliance with the two conditions set by Manila for the removal of its existing deployment ban—the signing of a new bilateral labor agreement with the Philippines and ensuring justice for Demafelis. Once Kuwait complies with the terms, Bello earlier said he will consider allowing the deployment of skilled workers to Kuwait, although the ban on Filipino HSWs will stay.

Reform opportunity

Despite the possible consequences, Migrante International Spokesman Arman Hernando urged the government to consider eventually phasing out the deployment of OFWs abroad to end the problems that come with it. “They should consider stopping it gradually, as it was intended when the government implemented its first overseas program during the time of [former President Ferdinand E.] Marcos...it was only supposed to be a stopgap measure,” Hernando said during a media forum. The migrant leader lamented that government efforts to restrict the deployment of OFWs, particularly HSWs, in the past have failed. Instead, the numbers continued to increase at an alarming rate. The annual deployment figures of OFWs breached the 1-million mark in 2009. It has since doubled in 2016. Hernando said this, in turn, led to an increase in the incidents of abuses involving OFWs. The government also failed to arrest the growing number of families that suffer its “social cost,” which ranges from broken families to unsustainable spending habits. Fr. Restie Ogsimer, CS, Catholic Bishops’Conference of the PhilippinesEpiscopal Commission on Migrants and Itinerant People, said the government could initiate the phaseout of OFWs by focusing first on the deployment of HSWs to the Middle East. He stressed that the HSWs are the most vulnerable due the nature of their work. “When they are at the homes of their employers, we no longer have any idea if they are being abused or not.” In 2016 more than half, or 275,073, of the 582,816 new hires deployed by the POEA were HSWs. Over 76.2 percent were deployed to Middle East countries.

Long-term plan

Hernando said the country’s dependence on foreign remittances is a symptom of the lack of decent jobs, which the government has yet to address. “This leads us to ask the question: What is the policy direction of our country when it comes to migration?” Although the DOLE has consistently reiterated that the government’s goal is to ultimately cut down overseas employment and promote local employment instead, it has yet to impose any clear reduction targets. Soriano agreed with Hernando that the ban should give the country the opportunity to harness its manpower in developing its local industries. Citing the case of Thailand after its nationals were banned by Gulf countries, Soriano said the Southeast Asian nation was able to recover by focusing on the development of its tourism and manufacturing industries, which eventually absorbed the displaced overseas workers. “Now they are more progressive than we are...based on their example, it could be done. I believe we could also succeed on it,” Soriano said.

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Bora Airport workers won’t lose jobs, pay during resort closure, SMC’s Ang assures By Lorenz S. Marasigan @lorenzmarasigan

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IVERSIFIED conglomerate San Miguel Corp. (SMC) assured on Thursday all workers and regular employees of the Boracay Airport will receive full salaries throughout the six-month closure of Boracay Island. SMC President Ramon S. Ang said his group intends to retain all employees of the airport, despite not needing full manpower when the world’s best island is temporarily closes due to the government’s clean up program. “We will retain all of them to make sure they have steady source of income during the closure,” he added. Local airlines are scheduled to scale down their Boracay operations for six months starting April 26. Ang also urged the airport’s employees to volunteer in the government’s clean up program. Likewise, Trans Aire Development Holdings Corp., operator of Boracay Airport and a subsidiary of San Miguel, will also allow the government to use the company’s dredging equipment, backhoes and barges. “The airport won’t be requiring full manpower while Boracay is totally closed to tourists so we are looking to encourage all our workers to help the government during the lull,” Ang said, adding the conglomerate will also make use of the six-month closure to carefully and thoroughly plot its game plan on how to turn Boracay Airport into a green gateway. This, Ang said, will help augment the government’s effort to rehabilitate the island and turn it into a sus-

tainable tourist destination. “Airports are gateways and as operator of the Boracay Airport, we have a responsibility to promote change and raise awareness at the front door among our visitors and the communities,” he said. He listed the ideas that the company will be exploring as: Acquiring a fleet of electric shuttle buses to ferry passengers and cargo; implementing green measures such as the use of fixtures that require less electricity and less water; strict implementation of waste segregation, and increasing green spaces and greenery throughout the airport complex, to help rid the air of carbon dioxide. He added: “If government needs more people to help with cleanups and similar activities where our people can contribute, they will be ready. We are very confident that they would gladly offer their paid time to support the island’s rehabilitation.” The airport will not shutdown during the six-month closure, as airlines will still operate a few flights to accommodate the locals of Boracay and its neighboring provinces. “We want this airport to exemplify what it is to be eco-friendly and sustainable. We want to send a clear message to visitors that here, we respect and take care of our environment; that they have a responsibility as well to do no harm to the environment,” Ang said. President Duter te ordered the six-month closure of Boracay starting this month to make way for the government’s efforts of addressing the environmental hazards in Boracay.

Editor: Vittorio V. Vitug • Friday, April 13, 2018 A3

PDEA raids clandestine shabu laboratory in Batangas; 4 Chinese, 4 others nabbed

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By Rene Acosta

@reneacostaBM

he Philippine Drug Enforcement Agency (PDEA) dismantled on Thursday a clandestine laboratory used in the manufacture of shabu and ecstacy in Batangas and arrested eight people, including four Chinese. PDEA Director General Aaron N. Aquino identified the four Chinese as Xie Jiansheng, Hong Dy, Tian Baoquan and Guo Zixing. Hong, Tian and Gou are chemists. Aquino also identified their Filipino cohorts as Nestor Baguio, Eduardo Lorenzo, 59, an electrician, Rosaleo Cesar alias Leo, 49, a driver, and Amancio Gallarde, 40. The raid, which was supported by a search warrant, was carried out inside the Hingoso Farm at Barangay

Santo Niño, Ibaan, Batangas. Aquino said the discovery and dismantling of the laboratory was a result of the intelligence support provided by the Office of the National Narcotics Control Commission (ONNCC), Narcotics Control Bureau of the Ministry of Public Security, People’s Republic of China to the PDEA. “A tip-off from ONNCC was first relayed to PDEA International Cooperation and Foreign Affairs Ser-

vice [ICFAS] that Chinese chemists are flying in and out of the country from September to October 2017,” Aquino said. He added Xie, who was believed to be the handler and manager of the chemists, returned to the country, in particular, Cebu City, from Guanzhou, China on February 24, before he traveled to Manila by taking a ship. Xie later visited a suspected shabu laboratory in La Union and stayed temporarily in Tagaytay City. “Three more Chinese chemists arrived in Manila from Jinjiang, Fujian province, China on March 6. Straight from the airport, they were fetched by the same guy,” Aquino said, adding the four all proceeded to Tagaytay City. Tian, Guo, Lorenzo, Cesar and Gallarde were arrested during the raid in Ibaan. The PDEA operatives seized large amounts of controlled precursors and essential chemicals used in the manufacture of shabu and ecstacy during the operation.

P.E.T. to Bongbong, Leni: Explain gag order ‘violation’ By Joel R. San Juan @jrsanjuan1573

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Neda initiative seeks to level playing field for state-owned and private corporations By Cai U. Ordinario

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@cuo_bm

he National Economic and Development Aut hor it y (Neda) is urging the formulation of a national competition policy to ensure that both state-owned and private corporations operate on a level playing field. Neda Officer in Charge and Undersecretary for Planning and Policy Rosemarie G. Edillon told the BusinessMirror that this will show the government’s commitment to strengthen the Government Owned and Controlled Corporation (GOCC) Governance Act of 2011 or Republic Act (RA) 10149 and the Philippine Competition Act (PCA) or RA 10667. To integrate these reforms, Neda, with assistance from the Philippine Competition Commission (PCC), will formulate a National Competition Policy this year. “RA 10149 and the Phil Competition Act are landmark legislations. Now, we want to take it to the next level where we have a comprehensive and coherent National Competition Policy,” Edillon said via SMS. The Governance Commission for GOCCs, the oversight body for GOCCs, has already conducted initial steps in reviewing profiles of GOCCs. Guided by key pillars of competition, the policy will flesh out competition strategies in the country’s economic blueprint. These pillars are pro-competitive laws and regulations and government interventions, competitive neutrality and the enforcement of the PCA and other competitionrelated laws and issuances. “While the enactment of the PCA and the good work done by the PCC on implementing the law are steps in the right direction, we believe there is still a lot that needs to be done to deliver a level playing field for busi-

nesses and higher bargaining powers for consumers,” Edillon said. In a news statement issued on Thursday, Edillon added this will also correct the dual regulatory and proprietary functions of some state entities and promote consumer welfare and public interest. She said regulatory functions and commercial operations should not mix because of inherent conflict of interest. This principle is clearly stated in Section 2 (g) of RA 10149. The Philippine Development Plan 2017-2022, Edillon added, also called for a review of the mandate, quality of services, and specific markets of GOCCs to ensure that their proprietary activities do not conflict with their regulatory functions and that procedures are streamlined. “A business aims to earn profit while a regulator sets rules to protect the consumer and the public interest in general, which may negatively affect profits. So, if a state entity is a regulator, then it must not be involved in business operations in the sector or market it regulates. If it is a business, then it must not have regulatory powers or influence,” Edillon said. “Ultimately, we would like to see more and more high-quality goods and services being made available and affordable to as many consumers as possible. Market competition and effective regulation can make this happen,” she added. The PCC was created in February 2016 as provided for under RA 10667, passed in July 2015. Part of its mandate is to review mergers and acquisitions (M&A) that may impede competition to the detriment of the consumers. In just a year, the antitrust body has received 80 notifications for M&A deals, as well as eight referrals for possible anticompetitive behavior in some sectors.

“The shabu laboratory has the capacity to produce 25 kilos or P125 million worth of shabu in one day,” Aquino stated. A separate operation resulted in the arrest of Hong Dy and Baguio in Lipa City, also in Batangas. Hours later, a follow-up operation was carried out which resulted in the arrest of Xie at Merry Homes, Barangay Francisco, Tagaytay City. Xie yielded 500 grams of suspected shabu worth P2.5 million. Aquino said Xie, Tian, Gou and Hong, who put up the shabu laboratory, in collusion with their Filipino cohorts, are connected to the infamous “Golden Triangle.” He added the Golden Triangle is notoriously known as the world’s foremost drug-producing region operating near the borders of Thailand, Laos and Myanmar. Aquino said per Chinese intelligence reports, the shabu and ecstasy producing laboratory was organized by a Hong kong-based drug kingpin.

Balancing act A worker precariously walks on scaffolding without any safety rope at the construction site of a skyscraper intended to house a call-center company in Bonifacio Global City (BGC) in Taguig. The onset of the dry season is expected to provide an ideal condition for yet another construction boom, not only in BGC but the entire country. ROY DOMINGO

ILO and ITUC web portal rates overseas job recruiters By Samuel P. Medenilla @sam_medenilla

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isting and identification of erring overseas job recruiters of migrant workers is now as easy as clicking a button after the International Labor Organization (ILO) held the international launch this week of its new Web-based rating system for recruitment agencies. The ILO partnered with the International Trade Union Confederation (ITUC) in developing its Recruitment Advisor web site (https://www.recruitmentadvisor.org/ituc/PH), where migrant workers from Nepal, the Philippines and Indonesia could rate the performance of their recruitment agencies in their country of origin and destination. The ILO said the web site also aims to inform migrant workers on their basic rights against abusive employers. “Ultimately the system will promote recruiters who follow a fair recruitment process, based on the ILO’s General Principles and Operational Guidelines for Fair Recruitment,” the ILO said in a news statement. In the Philippines ITUC tapped its local affiliate group Public Services

Labor Independent Confederation (PSLINK) to help in adopting the web site for local use, as well as get the initial users for its pilot test. “The users will be asked to answer formulated questions based on the ILO Fair Recruitment Principles and Guidelines. It has a comment section where they could write their thoughts/experiences, but it is not required,” PSLINK Advocacy Head Jilian Roque told the BusinessMirror in a text message. “For now we have 1,000 reviews already from OFW [overseas Filipino workers], although not have been uploaded,” she added. She said they are planning a local launch of the Recruitment Advisor after Labor Day to encourage more OFWs to use the web site. Last year PSLINK announced it will be developing a mobile application version of the Recruitment Advisor to make it more accessible to its users. The plan was temporarily shelved by PSLINK so it could focus its development of the web site. The web site rates a recruiter based on the following criteria: recruitment fees; predeparture orientation; employment contract; conditions in the country of destination; and services

for returning clients. It makes use of star-based system, wherein recruiters with the best service are given five stars, while those with the poorest service are given one star. The Recruitment Advisor boast of having 1,206 registered recruitment agencies for the Philippines, 1,410 in Indonesia and 753 in Nepal. The ILO said it plans to eventually expand the coverage of the web site to other countries with large number of migrant workers. ILO Technical Specialist Alix Nasri urged migrant workers in Nepal, the Philippines and Indonesia to utilize the web site since it will be instrumental in providing the necessary information to their fellow users. “A critical mass of reviews is needed for the platform to be really helpful for migrants,” Nasri said. ITUC General Secretary Sharan Burrow agreed with Nasri, saying it will lead to the empowerment of the migrant workers. “It’s time to put power back into workers’ hands to rate the recruitment agencies and show whether their promises of jobs and wages are delivered,” Burrow said.

he Supreme Court (SC), sitting as the Presidential Electoral Tribunal (PET), has issued a show cause order directing the camps of former Senator Ferdinand R. Marcos Jr. and Vice President Maria Leonor G. Robredo to explain why they should not sanctioned for violating its gag order in connection with the ongoing recount of votes for the 2016 vice presidential race based on the protest case filed by Marcos. The PET, in a resolution issued on April 10 signed by Edgardo Aricheta, clerk of the Tribunal, gave the two parties 10 days to show cause and explain why they should not be cited in contempt for violating the resolutions dated February 13, 2018 and March 20, 2018 issued by the PET. In its February 13, 2018 resolution, the PET ordered the parties to strictly observe the sub judice rule pending the proceedings of the case. This was reiterated in the Tribunal’s resolution dated March 20, 2018. The PET, however, noted that despite the directives, several news reports have shown that the parties, their counsels and/or representatives, have continued to disclose sensitive information regarding the revision process to the public, in clear violation of the aforementioned resolutions. “To be sure, the statements of the parties with respect to matters or concerns already referred to or pending resolution of the Tribunal, as well as statements and remarks pertaining to the integrity of the revision process are within the clear ambit of the sub judice rule. In this regard, to preserve the sanctity of the proceedings, both parties are hereby directed to show cause and explain why they should not be cited in contempt by the Tribunal,” the resolution said. Also in the same resolution, PET denied for lack of merit Robredo’s urgent motion to direct the head revisors to apply the correct threshold percentage as set by the Commission on Elections in the revision, recount and re-appreciation of the ballots, in order to expedite the proceedings for lack of merit. The PET said it still cannot determine when the recount will be finished. The recount is being conducted on Monday until Friday, from 8:30 a.m. to 4:30 p.m., with two 15-minute breaks and a one-hour lunch break. Marcos sought the recount of votes for the VP post claiming that the camp of Robredo cheated in the automated polls in May that year.

Economy

A4 Friday, April 13, 2018 • Editors: Vittorio V. Vitug and Max V. de Leon

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DENR detects 142 ‘undiscovered’ caves, sinkholes on Boracay Island

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By Jonathan L. Mayuga

@jonlmayuga

ome 142 cave openings and several sinkholes have been detected by the Mines and Geosciences Bureau (MGB) on Boracay Island, Director Theresa Mundita S. Lim of the Department of Environment and Natural Resources Biodiversity Management Bureau (DENR-BMB) revealed at a stakeholders’ forum for the declaration of a portion of Boracay as a critical habitat, revealed. “Previously, the DENR is only aware of five caves on the island, and only three of them have been assessed and classified so far, but we later learned that there may be more. The MGB discovered that [there are actually more than] 142 cave openings,” she said. The forum was held in connection with the proposed creation of the proposed Boracay Island Critical Habitat (BICH), which will cover a total area of 750.96 hectares composed of 119.85 hectares of land and 631.107 hectares of marine areas in barangays Yapak and Balabag. Environment Secretary Roy

A. Cimatu is expected to sign the Department Administrative Order for the BICH after property owners expressed no opposition to the proposal, which aims to protect and conserve bats and marine turtles and their known habitats.

Crown-of-thorns

AT the same stakeholders’ forum, dive shop owners expressed fear that funding for their program to battle crown-of-thorns infestation around Boracay Island will run dry. Crown-of-thorns is a large, multiple-armed starfish that usually preys on hard, or stony, coral polyps. It is

named so because of its venomous thorn-like spines that cover its upper surface, resembling the biblical crown of thorns. Addressing DENR officials during the open forum for the BICH, Michael A. Martillano, president of the Boracay Business Administration of Scuba Shops, warned that crown-ofthorns are fast spreading in cora- reef areas around Boracay and dive shop owners, from the group’s own fund, conduct activities to take out crownof-thorns out of Boracay’s waters. “Our concern is the underwater environment. A s mentioned before, there is an infestation of crownof-thorns. We want to know what will be the program of the government, while Boracay is closed. We are doing this underwater cleanup and crown-of-thorns collection on our own. Of course, right now, the reason why we can do this is that it is funded by the association’s own fund with the help of members. With this closure happening very soon, we don’t know what will happen,” Martillano said. While the government is doing rehabilitation on Boracay’s forest, rehabilitation underwater should also be done simultaneously, he added. “If the island is closed, of course, there are still divers who can do what we normally do, but we fear that we will run out of funds,” Martillano said. He, likewise, urged the government to make known its plan in addressing illegal fishing in the area.

Undiscovered ecosystems

AN old map of Boracay also revealed that there are 12 wetlands on the island. But the latest satellite images produced by the DENR revealed that only nine could be located. The map also showed that there are several sinkholes on the island. The discover y of new cave openings by MGB came as part of the DENR’s assessment of the island’s terrestrial and marine ecosystems call for further assessment of these potentiallyimportant ecosystems, Lim said. A cave is a unique ecosystem within an ecosystem, she added. The DENR, particularly the BMB, is mandated by Republic Act 9072 or “National Caves and Cave Resources Management and Protection Act” to conduct cave classification for purpose of conserving and protecting cave resources, including cave-dwelling species. Most caves are inhabited by

unique species, like insect bats, i n sec t s, sn a kes, l i z a rd s a nd other reptiles. “With the recent study of MGB, we discovered that there are 142 cave openings. That is why we must be more careful because development may cause these caves to collapse. On Boracay, we have previously classified a number of caves. Apparently, however, there are more caves than we previously thought of,” Lim added. During previous cave assessments, three of the five caves reveal an assortment of species—some are unique to the caves, like cave crabs, Lim said. “Some of these species cannot survive outside the caves. There are also sea snakes that dwell in caves,” she added. Bat-dwelling caves, which are insect bats because they feed mainly on insects like mosquitoes, are different from bats that hang and sleep in trees but they provide ecosystem

Previously, the DENR is only aware of five caves on the island, and only three of them have been assessed and classified so far, but we later learned that there may be more. The MGB discovered that [there are actually more than] 142 cave openings.”—Lim

Time to ‘sell’ PHL’s other prime tourist spots–solon By Jovee Marie N. dela Cruz @joveemarie

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lawmaker is urging the Department of Tourism (DOT) to undertake an aggressive marketing campaign to sell the Philippines’s other prime tourist spots. Rep. Luis Raymund F. Villafuerte Jr. of the Second District of Camarines Sur issued the statement on Thursday as one of the country’s main attractions—Boracay Island— has been ordered closed by President Duterte for six months to save it from environmental degradation. He added the DOT, the local government units and the private sector should work together on new marketing strategies to sell the Philippines as Asia’s premier tourist destination by developing its potentials as an ecotourism and adventure sports hub. He said the DOT can take advantage of the country’s natural attractions and the Filipinos’ famed hospitality and relative fluency in English to market the Philippines as an ecotourism haven. Citing Camarines Sur as an example, Villafuerte noted that the success of the tourism sector in the province was anchored on its promotion and development as a sports and adventure destination.

He said promoting a site as a sports tourism hub has a higher probability of tourists returning to the area because they have to train there to improve their skills. “The DOT can do wonders by aggressively pitching the country as an ecotourism haven and as an extreme sports destination, for one, to make up for Boracay’s shutdown,” Villafuerte added. Boracay, which attracts about two million tourists every year, was ordered closed by the President for a period of six months, starting April 26, to allow the island’s rehabilitation. According to the lawmaker, given the right tools, the DOT would not find it difficult to sustain the Philippines’s growing number of foreign tourist arrivals even with the closure of Boracay Island, given that even authoritative and respected online publications such as forbes.com have acknowledged the country as among Asia’s booming tourist locations owing to improvements in infrastructure and land, air and sea connectivity. Earlier, forbes.com named the Philippines along with Japan, Malaysia, Indonesia and South Korea as experiencing a “marked uptick” in tourist arrivals.

Bar exams result out on April 26

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HE Supreme Court (SC) on Thursday announced that it would release the results of the 2017 Bar examinations on April 26. The SC public information office said the justices will hold a special session in Manila after their annual summer sessions in Baguio City this month to deliberate on the results of the Bar exams. “After which, the 2017 Bar exams committee chairman, Associate Justice Lucas Bersamin, will officially announce the results. Names of successful examinees will be flashed on screen at the SC quadrangle and also posted to the SC web site,” the information office said. A total of 6,750 law graduates took the grueling Bar exams in November last year at the University of Santo Tomas campus in Sampaloc, Manila, facilitated by the High Court’s com-

mittee on the 2017 Bar exams chaired by Bersamin. The Bar examinations cover eight law subjects: Civil Law, Criminal Law, Labor Law, Legal Ethics and Practical Exercises, Mercantile Law, Political Law, Taxation and Remedial Law. In the 2016 Bar exams, a total of 3,747 law graduates passed or 59.06 percent of the total of 6,344 takers who completed the exams. It was the second highest passing rate in the history of the Bar exams since 1954 when the passing rate was 75.17 percent. In the 2013 Bar exams, the SC reverted to its previous format, which was predominantly essay-type, consisting of 80-percent essay-type questions and 20-percent multiplechoice questions (MCQ). In the two years prior to that, the SC had conducted a predominantly MCQ format of Bar exams. Joel R. San Juan

functions, especially in controlling the spread of mosquitoes that carry virus-like dengue and malaria. “We need to learn more about the interconnectivity of these caves,” she added. According to Lim, Boracay is rich in biodiversity. The forests on the island alone are already diverse, she added. “Boracay is composed of several forest types. Our findings revealed that there are three forest types on Boracay. Mangrove forest, forest over limestone which can be found in the Northern part of the island, and beach forests,” Lim said. Some of the trees in the forest over lime stones are 50 to 100 years old, she added. These trees are unique and need to be protected, she said. The forest over lime stones is on the northern part of the island has been identified as roosting sites of three species of flying foxes. “Flying foxes are actually [help in] expanding [forests]. They migrate to travel to the mainland to eat. They eat and spread seeds. They are natural seed dispersers and they are responsible for expanding the forest in mainland Panay,” she said. According to Lim, it is important to limit development and tourism activities in areas inhabited by Boracay’s unique wildlife like the fruit and insect bats. “While there is proof that bats and humans can coexist, it is also important to adopt environmentally responsible practices,” she said.

IPOPHL holds forum on ‘respectable’ intellectual-property regime this month By Elijah Felice E. Rosales @alyasjah

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SRP drive A woman gets help from her son in tending a family sari-sari store at a sidewalk near a provincial bus station in Manila. The

Department of Trade and Industry has recently announced that it will launch an awareness drive on the implementation of its suggested retail price (SRP) program, especially among community stores. NONIE REYES

DOE taps USAID’s help for RE zoning program By Lenie Lectura

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@llectura

he Department of Energy (DOE) is working with the USAID to develop a zoning program for renewable energy (RE). “We will have a RE zoning project with USAID. It’s a project with the USAID-NREL [National Renewable Energy Laboratory],” DOE Undersecretary Felix William B. Fuentebella said. The USAID-NREL partnership addresses critical aspects of advanced energy systems including grid modernization, distributed energy resources and storage, power sector resilience, and the data and analytical tools needed to support them. According to the DOE official, the goal of the planned RE zoning program is to identify where RE facilities should be located. “This is space management. What we are trying to look at is where should we place RE plants to avoid that problem that happened in Negros,” Fuentebella said. Transmission line constraints hamper the development of RE projects. The lack of transmission facilities is currently being addressed by the National Grid Corp. of the Philippines. Without adequate transmission lines, power produced from plants could not be transported. Hence, an oversupply could occur.

“Usually, what we are auctioning out are site specific RE technologies. But even if we have the RE zoning already, even those like solar and biomass that are not put into auction will have to undergo OCSP [Open and Competitive Selection Process] if there is zoning in place already,” Fuentebella said. Moreover, Fuentebella added the service contracts for solar and biomass can directly become an operating contract, thereby eliminating the predevelopment stage. “The goal in this change in policy of service contracting is to make it more competitive compared to the conventional plants,” he said. The DOE has tapped the USAID before for a possible collaboration in coming up with a responsive and dynamic energy mix for the Philippines. “Our main concern is to increase the availability of quality, reliable, secure and affordable supply,” Energy Secretary Alfonso G. Cusi said. “We are also looking at establishing an “army of reserves” so that when there is lack of supply, we have something to rely on,” he added. The study will focus on the energy requirements for economic growth trends, load consumption profiles for energy consumers, emerging energy technologies and local industry readiness, transmission configurations and network development.

he country’s intellectual-property (IP) rights watchdog is set to host a convergence forum this month, as the government intends to intensify its campaign to establish a “respectable” IP regime. As part of the celebration of the National Intellectual Property Rights Month, the Intellectual Property Office of the Philippines (IPOPHL) will conduct a high-level forum on April 26. The program will be headed by IPOPHL Director General Josephine R. Santiago, and is expected to be attended by delegates from the government, private sector and academe. In the forum, Santiago will talk about the government’s main action plan in trying to create a robust IP regime. This will include strategies for regulation, administration and enforcement of the country’s IP laws. “The IPOPHL is committed, now more than ever, to promote intellectual property and protect intellectual-property rights. Our duty to ensure an intellectual propertyfriendly environment that rewards creativity and innovation is the best incentive for Filipinos to harness intellectual property for national development,” Santiago said. “Promoting a culture that respects intellectual property, one that provides fertile ground for innovation and creativity, is a compelling competitive advantage for the country that spurs economic development. While IPOPHL is at the forefront of this advocacy, creating a conducive atmosphere that respects IP can only come about through concerted efforts of all stakeholders from public and private sector and Filipino consumers,” she added. The forum will also have World Intellectual Property Organization Director General Francis Gurry discussing how the country can adjust its national approach on IP under the context of the fourth Industrial Revolution. The IPOPHL views this as crucial given the emerging technologies that can either be a boon or a bane for the IP system. Aside from the high-level forum, the IPOHL also scheduled activities for the month aimed at enforcing compliance to IP laws and improving innovation in local industries with respect to regulations. Under Proclamation 190, President Duterte designated the month of April as National Intellectual Property Rights month to align the country’s IP rights celebrations with global IP festivities.

Agriculture/Commodities BusinessMirror

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Editor: Jennifer A. Ng • Friday, April 13, 2018

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‘PHL has ample sugar’

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By Jasper Emmanuel Y. Arcalas

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@jearcalas

he Philippines will not import sugar as the Sugar Regulatory Administration (SRA) said on Thursday that local production for crop year (CY) 2017-2018, which will end on August 31, is enough to cover the country’s sugar requirements. The SRA said the Sugar Board during its April 12 meeting “came to a consensus that there is no need to import sugar for domestic consumption.” The meeting was attended by Agriculture Undersecretary Segfredo R. Serrano, SRA Administrator Hermengildo Serafica and board members Roland Beltran and Bernardino Yulo. “There is no shortage of sugar. SRA data show that we will be able to reach our target production with enough buffer stock at the end of the milling season,” Serafica said in a statement. Yulo, who represents the sugarcane planters in the SRA board, and Beltran, who represents the sugar millers, dismissed reports that Manila is poised to purchase sugar abroad to plug the shortfall in domestic output. “During the presentation of the Regulation department, figures clearly showed that there will be no shortage,” Yulo said. “There is no basis for speculations being floated around regarding alleged importation plans,”

Beltran added. The SRA expects total sugar output in CY 2017-2018 to reach 2.27 million metric tons (MMT), 9.2 percent lower than the 2.505 MMT recorded in the previous crop year. Despite this, the projected sugar output is 100,000 metric tons more than the total estimated demand of 2.17 MMT. The latest preliminary data from the SRA showed that the country has produced 1.507 MMT of sugar as of March 25, 11.18 percent lower than the 1.697 MMT recorded in the same period last year In an interview with the BusinessMirror in February, the Philippine Sugar Millers Association (PSMA) estimated that the country’s total sugar output in CY 2017-2018 would reach 2.3 MMT. P SM A E x e c ut i v e D i re c tor Francisco D. Varua told the BusinessMirror that unfavorable weather conditions affected sugarcane plantations in some provinces, resulting in lower sugar content and milling recovery. Due to the expected decline in

total output in the current crop year, the SRA has earlier reduced the allocation of sugar for the United States market (“A”) to 6 percent, from 10 percent. The allocation of world market sugar (“D”), or those for export to other countries, was also cut to 6 percent, from the previous 10 percent. The SR A also increased the sugar allocation for the domestic market to 93 percent, from 80 percent. The SRA pegged the domestic demand for sugar at 2.17 MMT. “The domestic market remains as the priority market for locally produced sugar, and it is of national interest that a comfortable buffer, or carry-over volume, of ‘B’ sugar during the end of season and for the start of the next crop year for stable supply and prices,” Sugar Order (SO) 1-A read. “This sugar order shall take ef fec t i m med i ate ly cover i ng sugar production of week ending January 28 and subsequent week endings of CY 2017-2018,” it added. Varua also said he doesn’t see Manila receiving an additional sugar import quota from Washington in the current fiscal year, as Mexico is expected to fill up the expected sugar shortage of the United States. “We do not expect additional quota from the US, that is why we reduced the A allocation from 10 percent to 6 percent,” he said. “Mexico has been able to reengineer their situation to allow them to ship raw sugar of acceptable quality to US refineries and the same time allow them to ship in bulk,” Varua added.

PCA urges coco farmers to engage in group marketing

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he Philippine Coconut Authority (PCA) is encouraging coconut farmers to work together and engage in group marketing so they could negotiate for a higher price for their copra. The PCA made the statement after the price of copra dropped following the decline in the international price of palm oil. The agency noted that the price of palm oil in the world market has been going down since December 2017. “At present, the world market price is $623.50 per metric ton [MT]. This commands the price of coconut oil and other vegetable oils in the world market. If we convert this price to Philippine peso/kilogram [kg] using the current pesodollar exchange rate of P52, this is only P32.42/kg,” the PCA said. “This explains the very low price of copra as companies using vegetable oils will buy more palm oil if the supply is high and the price is low. But as the supply of palm oil will go down, prices of vegetable oils will again go up,” it added. The agency noted that the fluctuation of domestic copra price is cyclical and is beyond its control. The PCA also noted that domestic copra price is dependent on coconut oil price in the global market. “The global coconut oil price is determined or affected by the supply and demand situation of other vegetable oils [e.g. oil palm, soybean, rapeseed, sunflower, olive oil, etc.] Though the Philippines is the biggest exporter of coconut oil in the world, coconut oil is just one of the many vegetable oils produced in the world,” the agency said. “As such, its price is greatly af-

fected by the movement of prices of other vegetable oils particularly the palm oil which is the biggest among the internationally traded vegetable oils [35 percent], and soybean oil, the second biggest vegetable oil [29 percent],” it added. The PCA, however, assured that it is undertaking measures to help farmers cope with the decline in the price of copra. The agency noted that it has exerted efforts to increase coconut production through fertilization. “[The agency] has an intercropping and animal dispersal program to provide farmers some alternative sources of income. The agency is also encouraging and teaching the coconut farmers to move toward value addition of coconut instead of relying on copra production,” the PCA said. Since 2013 the PCA said it has been implementing the Kaanib Enterprise Development Project and Community/Household Level Coconut Processing Project where coconut farm households through the Small Coconut Farmers Organization are trained and provided with processing equipment for value-adding of coconut. The agency also encouraged coconut farmers to coordinate with the PCA Coconut Development Officer in their municipalities for further information of PCA and other government programs and projects in their areas. The PCA said it is also calling for a meeting with the big coconut processors so they can find ways to address the impacts of the copra price situation.

What satellites can’t see: US crop forecasters walk and learn

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or decades, government satellites have been taking detailed photographs of crops around the world that are now being tapped by traders like Cargill Inc. to gain an edge in global grain markets. But the United States Department of Agriculture (USDA)—the benchmark in forecasting domestic crops—says the images by themselves still can’t be relied upon to predict annual corn, wheat or soybean harvests. Instead, the government’s main source of information remains farmer surveys and random field samples. “Satellites are not advanced enough to differentiate crop acres yet, so there is a loss of precision,” said Seth Meyer, the chairman of the World Outlook Board, the USDA agency responsible for world crop forecasts. “This technology is going to get better, but right now it’s just one tool in our forecasting toolbox.” Getting accurate assessments of major US crops valued at more than $100 billion last year is a recurring challenge for traders, consumers

and farmers. Crop conditions can change with the weather over the long growing season, so any early forecasts may be far off the mark when harvest rolls around. Some scientists expected satellite images to eventually make the job easier. The US has been taking pictures from space since the 1970s to track everything from the weather to troop movements. But it wasn’t until the last few years that advances in digital technology and computing power made those billions of images more useful in crop forecasting.

Making switch

Statistics Canada, the government agency that produces the country’s monthly crop forecasts, already is using the technology in key crop assessments. In 2016 StatsCan switched to using only satel l ite - a nd weat her-based models for a monthly production report published in September, saving about C$150,000 ($95,000) in farm and field surveys for that

Bloomberg

month. Other reports during the year still rely on the surveys. “There’s been a lot research put into this model to verify its robustness,” said Gordon Reichert, head of remote sensing analysis at Statistics Canada. “Feedback from the grain companies in Canada has been favorable.” Satellites scan thousands of square miles of agricultural land and record daily changes in areas as small as two dining tables, mostly by analyzing how green the fields are

from planting to harvest. Machinelearning algorithms then match those characteristics with historical data and production results to make forecasts.

Computer models

In 2008 the US began offering its satellite data and three decades of history for free, and the European Union made all its space-based observations public in 2013. Companies like Descartes Labs Inc.,

TellusLabs Inc. and Planalytics Inc. used the information to develop computer models to make all kinds of predictions, including for grain production. Other companies even sent their own monitoring devices into orbit and market the data to farmers looking to catch nutrient deficiencies or diseases soon enough to be treated. It’s an effective early warning tool, said Bruno Basso, an environmental scientist at Michigan State University and co founder of CiBO Technologies in Cambridge, Massachusetts.For example, the world was caught off-guard in 1972 when harsh weather led to a big drop in wheat harvests in the former Soviet Union. The country kept the damage secret and filled the shortage with 440 million bushels of US wheat, or 28 percent of what American farmers produced that season using subsidies provided by the US government. Prices tripled, and the Soviet purchases were dubbed the “great grain robbery” by traders. Bloomberg News

Marcventures, Go Negosyo unveil Agri Model Farm in Marawi By Jonathan L. Mayuga @jonlmayuga

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arcventures Mining and Development Corp. (MMDC) has partnered with the Philippine Council for Entrepreneurship (PCE)-Go Negosyo to implement an agriculture-based sustainable livelihood program that will benefit internally displaced persons (IDPs) in war-torn Marawi. Dubbed Go Negosyo Kapatid for Agri Model Farm, the program launched on April 5 is part of President Duterte’s multifaceted flagship community project under Task Force Bangon Marawi. DSWD Undersecretary Luzviminda Ilagan and Bangon Marawi Assistant Secretary Felix Castro led government officials who participated in the program launching in Barangay Sagonsongan where more than 10,000 IDPs are resettled. “We at Marcventures are honored to be part of this program,” Isidro C. Alcantara Jr., Marcventures Holdings Inc. president and MMDC vice chairman said in a statement. “Mindanao is close to our hearts as our Carrascal Nickel Project is in Surigao del Sur, that is why we consider this island group part of our larger host community,” Alcantara added. “We thank Mr. Joey Concepcion, the presidential consultant for entrepreneurship, for inviting us to be part of this undertaking.” The Agri Model Farm will be implemented over a three-month period within which some 300 Sagonsongan resettlement farmers will go through weekly lectures and hands-on training under a seasoned agri-technician, said Ana Margarita Hontiveros, Go Negosyo Adviser for Agripreneurship and Programs Head for the Autonomous Region in Muslim Mindanao. “The farmers are expected to implement daily in the field what they have learned,” Hontiveros explained. “At the end of the threemonth training, the graduates will celebrate a Harvest Festival.” The Agri Model Farm is aligned with Marcventures’s social-development approach which is anchored on the principle of sustainability. “We strive to ensure that mining will provide livelihood not only during the life of mine but, more importantly, long after mining has ceased,” Alcantara added. Marcventures said sustainable livelihood projects such as the Agri Model Farm should be given priority in community development programs. “We also want to learn from this program and apply this template in Surigao del Sur and in other areas where we will be allowed to operate.” The Sagonsongan Agri Model Farm is the third farm site under the program. The first two farms have been successful; participants have established farmers’ associations and have forged agreementswith a private company for the purchase of their produce.

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Friday, April 13, 2018

The World BusinessMirror

Editor: Lyn Ressureccion | www.businessmirror.com.ph

Risks abound with plan to strike Syria

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ASHINGTON—President Donald J. Trump made clear on Wednesday that missiles “will be coming” at Syria at any moment, telegraphing a military operation as he has previously said he would never do. But the real suspense remained—how many missiles, for how long, at what targets and to what end.

The strike that Trump was preparing as retaliation for a suspected chemical attack carries all sorts of perils that worry military planners and diplomats alike. A fresh intervention in one of the most combustible battlegrounds on the planet—one already crawling with Syrian, Russian, Iranian, US, Turkish and Kurdish forces—could easily bring unintended consequences. The more expansive the strike, officials and experts said, the greater the risk of accidental casualties that could deepen the conflict with Russia or Iran. Yet a more restrained operation might not inflict enough damage on the government of President Bashar al-Assad to change his calculations. If Trump goes beyond missiles and authorizes the use of manned aircraft even from outside Syrian airspace, they face the dangers of a modern air defense system provided by Moscow. And Trump’s Twitter warning, along with the delay in acting, has given the Syrians, as well as their Russian and Iranian allies, days to prepare. Two Defense Department officials said the Syrian military had moved some of its key aircraft to a Russian base, assuming the Americans would be reluctant to strike there. Russian commanders have also moved some of their military forces in anticipation of US action. “You want to hit military targets, military equipment as much as possible, because it’s the Syrian military that’s carrying out these

atrocities,” said Andrew J. Tabler, a Syria scholar at the Washington Institute for Near East Policy. “You want to make sure that you deliver a message and that you degrade their military capabilities.” At the same time, he added, “the risk is, there are a lot of Russians throughout Syria.” “They’re claiming they have people at every Syrian base,” he continued. “If you end up killing Russians, that risks a confrontation with Russia.” Trump said earlier this week that he would respond to Saturday’s suspected chemical attack within 24 to 48 hours. But the move toward military action has slowed as the administration sought to coordinate with allies, including France and Britain. A joint operation takes longer to organize but would avoid the United States looking like it was acting on its own. Prime Minister Theresa May of Britain called a Cabinet meeting for Thursday, and the BBC reported that she was ready to join a military operation without seeking approval from Parl i a ment, a s her predecessor, David Cameron, did in similar circumstances in 2013 only to be rebuffed by lawmakers. May ordered Br itish submar ines to move w ithin missile ra nge of Sy r ia, accord ing to The Daily Teleg raph. President Emmanuel Macron of France, who is scheduled to v isit Washington this month for a state dinner at the W hite House, has made clear that he was determined to participate

in a strike, as well. France has war planes armed with cruise missiles in nearby Jordan and the United Arab Emirates. Trump left little doubt about his intention with an early-morning Twitter post on Wednesday. “Russia vows to shoot down any and all missiles fired at Syria,” he wrote. “Get ready Russia, because they will be com-

ing, nice and new and ‘smart!’ You shouldn’t be partners with a Gas Killing Animal who kills his people and enjoys it!” The message conflicted with Trump’s oft-stated scorn for President Barack Obama for, in his view, forecasting his military moves. “No, dopey, I would not go into Syria,” Trump wrote on Twitter in 2013 when Obama was con-

The risk is, there are a lot of Russians throughout Syria. They’re claiming they have people at every Syrian base. If you end up killing Russians, that risks a confrontation with Russia.”—Tabler

sidering a strike of his own in retaliation for a chemical attack on civilians, “ but if I did it would be by surprise and not blurted all over the media like fools.” Sarah Huckabee Sanders, the White House press secretary, said on Wednesday that the president was not violating his own policy because he did not give a precise time for the attack to begin. “The president has not laid out a timetable and is still leaving a number of other options on the table,” she said. “And we’re still considering a number of those, and a final decision on that front hasn’t been made.” Defense Secretar y Jim Mattis said the United States was still evaluating the intelligence on the suspected chemica l attack last Saturday that k il led dozens in Douma, a suburb of Damascus.

Zuckerberg: Regulation inevitable for social-media firms

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A SHINGTON—Facebook CEO Mark Zuckerberg acknowledged that regulation of social-media companies is “inevitable” and disclosed that his own personal information has been compromised by malicious outsiders. However, after two days of congressional testimony, what seemed clear was how little Congress seems to know about Facebook, much less what to do about it. Hou se l aw m a kers a g g res sively questioned Zuckerberg on Wednesday on user data, privacy settings and whether the company is biased against conservatives. As they did in the Senate a day earlier, both Republicans and Democrats suggested that regulation might be needed, but there was no consensus and few specifics about what that might look like—or even what the biggest problems are. New Jersey Rep. Frank Pallone, the top Democrat on the panel and a 30-year veteran of the House, said at the beginning of the hearing that he plans to work on legislation but is pessimistic that Congress will pass anything. “I’ve just seen it over and over again—that we have the hearings, and nothing happens,” he said. For Zuckerberg, who often found himself explaining what his company does in rudimentary terms to lawmakers twice his age,

the hearings could be considered a win: Facebook shares rose more than 1 percent after climbing 4.5 percent on Monday. And his company regained more than $25 billion in market value that it had lost since it was revealed in March that Cambridge Analytica, a data-mining firm affiliated with Donald J. Trump’s presidential campaign, gathered personal information from 87 million users to try to influence elections. Still, Facebook’s stock remains 10 percent below where it stood before the scandal, a decline that has wiped out about $50 billion in shareholder wealth. Zuckerberg agreed to the hearings as pressure mounted over the Cambridge Analytica scandal and the company’s own admission last year that it had been compromised by Russians trying to influence the 2016 election. Earlier this year, special counsel Robert Mueller charged 13 Russian individuals and three Russian companies in a plot to interfere in the 2016 presidential election through a social-media propaganda effort that included online ad purchases using US aliases and politicking on US soil. A number of the Russian ads were on Facebook. Zuckerberg told the Senate on Tuesday that the company has been working with Mueller in his Russia probe and apologized over

and over again for the company’s handling of data privacy. “I started Facebook, I run it, and I’m responsible for what happens here,” he said. House lawmakers were a bit tougher on Zuckerberg than their colleagues in the Senate, many of whom seemed confused by the company and what it does. Some of the House members curtly cut him off in questioning, trying to make the most of their four minutes each. Zuckerberg mostly held his composure, repeating many of the same well-rehearsed answers: He is sorry for the company’s mistakes. He is working on artificial intelligence technology to weed out hate speech and, at the same time, ensure that they don’t block people for the wrong reasons. People own their own data, as far as he sees it. And he’s come a long way since he created the platform in his dorm room almost 15 years ago. Some of the lawmakers talked to Zuckerberg, 33, as they would their children or grandchildren, and were occasionally befuddled by the complexities of his company. Wrapping up his four minutes, Rep. Gus Bilirakis, Republican-Florida, commended the platform, saying “it’s wonderful for us seniors to connect with our relatives.” AP

House Speaker Paul Ryan of Wisconsin announces that he will not run for reelection at the end of his term on April 11 on Capitol Hill in Washington. AP/Jacquelyn Martin

Ryan retirement sends new uncertainty through GOP

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ASHINGTON—House Speaker Paul Ryan’s abrupt announcement that he will retire rather than seek another term in Congress as the steady, if reluctant, wingman for President Donald J. Trump sent new ripples of uncertainty through a Washington already on edge and a Republican Party bracing for a rough election year. The Wisconsin Republican cast the decision to end his 20-year career as a personal one—he doesn’t want his children growing up with a “weekend dad”—but it will create a vacuum at both ends of Pennsylvania Avenue. It will leave congressional Republicans without a measured voice to talk Trump away from what some see as damaging impulses, and it will rob Trump of an influential steward to shepherd his more

ambitious ideas into legislation. It’s unusual for a House speaker, third in line to succeed the president, to turn himself into a lame duck, especially so for Ryan, a once-rising GOP star who is only 48 and was the party’s vice-presidential candidate in 2012. His decision fueled fresh doubts about the party’s ability to fend off a Democratic wave, fed by opposition to Trump, in November. And it threw the House into a leadership battle that could end up pushing Ryan aside sooner than he intended and crush any hopes for significant legislation before the election. Ryan, though, said he had no regrets after having accomplished “a heckuva lot”during his time in a job he never really wanted. He said fellow Republicans have plenty of achievements to run on this fall, including the tax cuts Congress delivered, which have been his personal cause and the centerpiece of his

“We’re still assessing the intelligence, ourselves and our allies,” he told reporters. “We stand ready to provide military options if they’re appropriate, as the president determined.” Few, if any, doubt the US capacity to inflict damage on Assad’s government. But it remains unclear whether the operation envisioned by Trump will be any more meaningful than a cruise missile strike he ordered last year after a similar chemical attack. That strike hit a Syrian air base that was up and running again within 24 hours. “The question then becomes, are we just going to try to add additional costs on Assad and see and hope that it establishes a more effective deterrence? Or is President Trump going to, no kidding, pursue an effective deterrence that holds not just Assad, but his external backers, accountable as well?” said Jennifer Cafarella, a senior analyst at the Institute for the Study of War. Military operations can produce unintended consequences and diplomatic nightmares. President Bill Clinton’s air strikes against al-Qaeda targets in 1998 missed Osama bin Laden in Afghanistan and hit a pharmaceutical plant in Sudan that turned out not to be the chemical weapons facility US intelligence analysts thought it was. Clinton’s air campaign to protect Kosovo from Serbian forces a year later resulted in the accidental bombing of the Chinese Embassy in Belgrade. Accuracy of US weaponry has improved since then, but mistakes and limitations remain facts of war. In February a clash in Syria between pro-government forces backed by Russian mercenaries and a largely Kurdish militia that is supported by the United States left an undetermined number of the Russians dead. Just days later, Syria demonstrated that its air defenses could threaten foreign warplanes when an Israeli F-16 fighter jet crashed after coming under heavy fire, the first Israeli plane lost under enemy attack in decades. New York Times News Service

small-government agenda, even though they helped skyrocket projected annual deficits toward $1 trillion. “I have given this job everything I have,” Ryan said on Wednesday. Speculation over Ryan’s future had been swirling for months, but as he dialed up colleagues and spoke by phone with Trump, the news stunned even top allies. Ryan announced his plans at a closed-door meeting of House Republicans. Rep. Mark Walker of North Carolina said an emotional Ryan “choked up a few times trying to get through” his remarks and received three standing ovations. He later briefly thanked Trump in public for giving him the chance to move GOP ideas ahead. While Ryan was crucial in getting the tax cuts passed, a prime Trump goal, he and the president have had a difficult relationship. Trump showed impatience with Congress’s pace in dealing with his proposals, and Ryan had to deal with a president who shared little of his interest in policy detail. Still, for many Republicans, it’s unclear who will be left in leadership to counterbalance Trump. Ryan has been “a steady force in contrast to the president’s more mercurial tone,” said Rep. Mark Sanford of South Carolina. “That’s needed.” The speaker had been heading toward this decision since late last year, said a person familiar with his thinking, but as recently as February he had considered running for another term. His own father died suddenly of a heart attack when he was 16, and though Ryan is in good health, the distance from his family weighed on him. A final decision was made over the two-week congressional recess, which he partly spent on a family vacation in the Czech Republic. AP

www.businessmirror.com.ph | Editor: Lyn Ressureccion

The World BusinessMirror

Friday, April 13, 2018

A7

Latest sanctions push Russian economy into a ‘new stage’

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OSCOW—Compared to the sunny, palm-lined offshore tax havens where Russians typically stash their fortunes—think the British Virgin Islands or Cyprus—two chilly, windswept Russian islands would seem to offer little. Yet October Island, a glorified swamp in Russia’s European exclave of Kaliningrad and Russian Island, a former cow pasture facing the far eastern port of Vladivostok, were highlighted by Moscow this week as potential alternatives. Washington’s imposition of unexpectedly tough sanctions against several leading oligarchs is in many respects a game-changer for Russia, with repercussions that are only slowly coming into view. Establishing tax havens within the country was just one reaction by the Kremlin, seemingly caught off guard as aftershocks rippled through currency and financial markets. “Russia has no strategy on how to react to this situation, to these new economic circumstances” said Evgeny Gontmakher, a prominent opposition economist. The most immediate effect is being felt by Oleg V. Deripaska and his aluminum giant, Rusal, which has lost about one-third of its value on the Moscow stock exchange. “This is a new stage,” Gontmakher said. “This is targeting for isolation a very big, export-oriented company. That is very painful.” The ramifications could also be felt by wealthy Russians in London, as Washington warned British banks on Tuesday that they could face severe penalties if they continued dealings with any of 24 Russians named in the sanctions, including seven oligarchs. Paradoxically, the sanctions could help President Vladimir Putin to accomplish a long-held goal of putting more of the economy under state control and pressuring billionaires to bring their money home. Yet, the sanctions might also work against Putin’s interests, forcing some of the wealthiest Russians to decide just how closely they want to be identified with the Kremlin by financing militias, political organizations or other adventures abroad. “Anyone who wants to help the Kremlin outside will think twice,” said Konstantin Gaaze, an analyst and frequent contributor to the Moscow Carnegie Center web site. In a larger sense, the sanctions are expected to have a limited overall effect after the initial shock wears off, because they ultimately targeted just a handful of companies. But the virtual sequestering of a critical Russian commodity producer has introduced a strong element of uncertainty into dealings with all Russian raw materials, the taproot of the countr y’s

income, which is likely to further isolate Russia from the world. The initial government response was muted, with Dmitri S. Peskov, the spokesman for Putin, telling reporters that “it would be wrong to make hasty decisions” and predicting that the value of the ruble and the Russian stock market would bounce back once emotions settled down. Given the tiny size of the Russian economy—around 2 percent of global GDP—and its limited trade with the United States, there was little expectation of economic retaliation. Any Russian response was likely to come in places like Syria or Ukraine, analysts said, where the Kremlin might ratchet up tensions in order to leverage any solution on ending the sanctions. With a US strike in Syria possible at any moment, in response to what was suspected to be a chemical weapons attack by the forces of President Bashar alAssad, an occasion for that scenario might materialize quickly. Russia had been lulled into thinking no significant sanctions were coming. In January in response to a new US law last summer demanding tougher action against Moscow, the Trump administration did nothing more than publish a list culled from the pages of Forbes Magazine of every billionaire in the country along with the Kremlin’s internal telephone directory. “People thought this was a joke, but now it is clear that the situation is serious,” said Vladislav S. Zhukovsky, an economist and investment consultant. “This is more serious than the previous sanctions.” The two most prominent industrialists targeted were Deripaska, whose Rusal company employs an estimated 60,000 in Russia, and Viktor F. Vekselberg, one of the richest men in Russia, whose projects include trying to develop the country’s tech sector. Overall, the sanctions were imposed on seven Russian oligarchs, 12 companies they control and 17 senior government officials, who, the US Treasury said, profited from the Russian state’s “malign activities” around the world. “It is not clear what are the key sins that got people transferred from the big list to the small list,” said Kirill Rogov, an independent political and economic analyst. “The logic is not clear, which increases the risk for all others.” More possible sanctions are already in the pipeline, following the poisoning in Britain last month of a Russian former spy, Sergei V. Skripal, and his daughter, Yulia. A draft law in Congress would ban Americans from any dealings with new Russian sovereign debt. New York Times News Service

Economists: US tariffs are wrong move on a valid issue

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ASHINGTON—President Donald J. Trump’s advisers insist that the economics profession is solidly behind the administration’s threat to impose tariffs on hundreds of billions of dollars of Chinese imports. Many top economists say, no, they’re not. Across the ideological spectrum, trade experts and former top economic advisers to presidents say Trump is right to highlight issues on which China is widely viewed as an offender—such as intellectual-property theft and access to its domestic market. But many of those experts say Trump’s planned tariffs would backfire—by raising costs to US businesses and consumers, and by inviting retaliation against American exporters. They say he would better serve his purposes by enlisting international allies in a pressure campaign against Beijing.

Mistake to leave TPP

“Many economists have said, yeah, there’s some legitimate issues here,” said Laura D. Tyson, an economist at the Haas School of Business of the University of California, Berkeley, who headed the Council of Economic Advisers under President Bill Clinton. “I haven’t seen any who have said the appropriate response is a series of tariffs on a bunch of goods,

most of which don’t have any real link to the underlying issue.” Tyson and many other economists say it was a mistake last year when Trump pulled the United States out of the Trans-Pacific Partnership (TPP). Proponents of that agreement say it would have unified a dozen countries against the Chinese on trade issues. “I don’t think the way the administration is going about it is a particularly strategic one,” said David Autor, a Massachusetts Institute of Technolog y economist whose research suggests that opening trade with China cost the United States 2 million jobs in the late-1990s and early-2000s. “ The first way to go about it should have been to sign TPP, which was set up as a bulwark against China.”

China ‘stealing’ US intellectual property

Trump has long railed against Chinese trade practices, and he has long criticized previous presidents for their approach to the issue. This year, he has pushed aggressively on the issue.

He levied tariffs on imported steel and aluminum that were largely viewed as a shot at Chinese oversupply of those metals. Then he proposed as much as $150 billion in tariffs on other imports from China. His advisers have stressed that economists largely agree with Trump that the Chinese are stealing US intellectual property and restricting access to their market in ways that put US companies at a disadvantage. “No free-market guy, no freetrade guy disagrees on this subject,” Larr y Kudlow, the new director of the National Economic Council, said on CNN’s State of the Union last Sunday. “ The guild, if you will, the brethren of the economic profession have all agreed that something has to be done.” Peter Nav a r ro, t he d i re ctor of Trump’s Office of Trade and Manufacturing Policy, told NBC ’s Meet the Press last Sunday that “what we have here is a situation where ever y American understands that China is stealing our intellectual property, they’re forcing the transfer of ou r tec h nolog y whe n companies go to China, and by doing that, they steal jobs from A merica, they steal factories from America, and we run an unprecedented $370 -billion-ayear trade deficit in goods. This is an unsustainable situation.” Many economists agree that China needs to be confronted on several trade issues, although very few share Trump’s fixation on the US trade deficit with China. Most say bi l atera l t rade

def ic its a re not a good measu re of ma rket access or t he fa ir ness of t rade ag reements. “I think the basic issue that the Trump administration is pointing to—the lack of intellectualproperty protection—is a serious one, particularly for the United States,” said N. Gregory Mankiw, a Harvard economist who headed former President George W. Bush’s Council of Economic Advisers. “It’s a completely serious and appropriate issue for the administration to be concerned with.” What worries Mankiw and others is Trump’s threat of tariffs, which administration officials have portrayed both as a bargaining chip and as a policy Trump would certainly carry through on.

Tariffs to ‘hurt yourself’

Economic forecasters are just beginning to predict how tariffs would affect growth. Goldman Sachs analysts wrote this week t h at t he c u r rent ly proposed tariffs would cut less than 0.1 percentage points off US growth this year but also said that “ it is harder to rule out continued escalation to a level that does ultimately have a first-order impact on the economy” if the United States and China do not find compromise. Because tariffs would raise prices for US businesses and consumers that buy imported goods, “you’re hurting yourself if you follow through with it,” Mankiw said. “It just seems to me to be a not very smart threat to be making, given that it would not be rational to follow through with it.”

Multinational coalition vs China

Economists who don’t like tariffs but favor action against China largely say the United States should be forming a multinational coalition to confront the Chinese. “A ny good strateg y has to include getting other countries on your side,” said Jason Furman, an economist at Harvard ’s Kennedy School of Government who headed the Council of Economic Advisers under President Barack Obama. “If it’s the United States versus China, we’re similar-sized economies. If it’s the United States and the world versus China, that’s not something China can win.”

Press case before WTO

Furman, Mankiw and others said the US should continue to press its case against China before the World Trade Organization—a strategy that Navarro and other advisers to Trump say has not produced favorable results in the past. The economists who disagree with the administration’s approach also stress, frequently, that joining the TPP would have given the United States leverage in this dispute. Since Trump quit the pact, 11 other countries have forged ahead on it. He said this year that he would reconsider joining the agreement if it was renegotiated to benefit the US more substantially. “It’s obviously a terrible mistake” to have quit the agreement, said Austan Goolsbee, an economist at the University of Chicago’s Booth School of Business and an-

other past chairman of Obama’s Council of Economic Advisers. “This was a coalition of the vast majority of the economies of Asia outside of China, agreeing to principles exactly of the form that we’re now saying that we want. We would be in a lot better situation if we had all of those people on our side.”

Traditional remedies not useful

Trump’s unilateral approach, including his tariff threats, has drawn qualified support from at least one unlikely high-profile economist: Martin Feldstein, of Harvard, a chairman of President Ronald Reagan’s Council of Economic Advisers. Feldstein began a syndicated op-ed column last month, on the subject of Trump’s steel and aluminum tariffs, by declaring, “Like almost all economists and most policy analysts, I prefer low trade tariffs or no tariffs at all.” But he went on to criticize China’s intellectual-property policies and predict that the United States “cannot use traditional remedies for trade disputes or World Trade Organization procedures to stop China’s behavior.” US negotiators, Feldstein wrote, would use tariff threats “as a way to persuade China’s government to abandon the policy of ‘voluntary’ technology transfers.” “If that happens, and US firms can do business in China without being compelled to pay such a steep competitive price,” he continued, “the threat of tariffs will have been a very successful tool of trade policy.” New York Times News Service

Banking&Finance BusinessMirror

A8 Friday, April 13, 2018 • Editor: Jun B. Vallecera

Legislators push P3 program for microentrepreneurs T

he House Committee on Appropriations has endorsed for plenary approval two measures strengthening entrepreneurship and promoting a socialized microfinancing program for microenterprises in the country. The measures are House Bill 5158, or the “Act Providing a Socialized Microfinancing Program for Microenterprises Thereby Promoting Entrepreneurship” and HB 3335, or “Act Promoting the Development of Entrepreneurship Skills Among Government Employees to Inspire Innovativeness and to Ensure their productivity even beyond government service.” The measures were seen discussed at the plenary when session resumes on May 14. HB 5158 seeks to provide Filipinos with an affordable, accessible and simple micro financing program for the country’s micro enterprises, especially in the poorest sectors. The bill’s top feature is the creation of the Pondo sa Pagbabago at Pag-Asenso fund, or the P3. In fact, the short title of the measure is the “P3 Act.” Eyed as beneficiaries of the P3 fund are microenterprises and entrepreneurs, including market vendors, agribusinessmen and members of cooperatives, industry associations and cooperators. The measure mandates the Small Business Corp. (SB Corp.) as lead agency for

the P3 fund, and will handle fund delivery through direct lending to microenterprises; wholesale lending to conduits, which shall on-lend to microenterprises; and provision of guarantees to loans granted by the banks to qualified P3 beneficiaries. Once institutionalized, Rep. Karlo Alexei B. Nograles of Davao City, chairman of the appropriations committee, said the P3 will give prospective entrepreneurs a better source of capital than, say, informal moneylenders or loan sharks, including those who use the “56” lending system. “Through this [law], the state will truly be a partner in growing one’s business or in simply helping make a good business idea come to fruition,” he added. Meanwhile, HB 3335 intends to ensure the continuous flow of innovative and development-oriented government programs and projects for entrepreneurial development. The bill targets the participation of government retirees, as well as employees, who are slated to retire from government service in five years. The measure provides that all government offices and agencies prepare and implement a post-service Government Service Entrepreneurship Development Program for their employees based on guidelines to be prescribed by the Civil Service Commission. Jovee Marie N. dela Cruz

Case clippings

By Justice S J Ranada Jr. DANGEROUS DRUGS–no media and DOJ representation In a dangerous drug prosecution, the fact that the buy-bust operation was conducted at about 6:20 p.m. in a squatter’s area, without any representatives from media, the DOJ, or an elected public official because none was available and the police were pressed for time, are justifiable reasons for noncompliance with the requirements of law, where the integrity of the seized items were preserved, as shown by the unbroken chain of custody. People v. Pundagar 07 Feb. 2018

GR 214779 Del Castillo, J

www.businessmirror.com.ph

Singapore favors ‘organic’ policy in move toward open banking

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ingapore wants its lenders to share data with financial technology and other nonbank firms, but doesn’t plan to force the issue, according to a central bank official. The transition toward “open banking” can be more successful if it takes place without the regulator mandating action, said David Hardoon, chief data officer at the Monetary Authority of Singapore (MAS). “You can come and say ‘thou shall do it’ but then nothing happens effectively,” Hardoon said in a Wednesday interview. The MAS’s policy differs from the approach taken in Europe and Japan, where regulators have set deadlines for banks to give access to their client data to rivals and to fintech firms. In Europe banks have until 2019 to comply with the revised Payment Services Directive (PSD2), which obliges them to

share client account data. Singapore’s banks already see the advantages of open banking and are taking action to share their data, Hardoon said. “The point being, we are heading there in an organic fashion,” he added. “I believe the open banking approach is a good thing and definitely can benefit Singapore.” DBS Group Holdings Ltd., Singapore’s largest bank, launched a platform last November that allows third-party developers to access 155 of its application programming interfaces for functions such as real-time payments. Oversea-Chinese Banking Corp., which introduced its API platform in May 2016, has announced a data-sharing partner-

ship with telecom-services provider StarHub Ltd. that allows cross-selling to their respective customers. The MAS plans to come up with guidelines for ethical usage of data analytics and artificial intelligence that could work with both regulated and unregulated industry participants, Hardoon said. Banks and fintech firms need to not just focus on getting the initial permission for data use, but also to understand how to use that data once they have the permission, he said. The importance of safeguarding customer data has been highlighted by the leak from Facebook Inc. of information from as many as 87 million users, siphoned to Cambridge Analytica, a British firm with ties to the 2016 campaign of President Donald J. Trump. One of the key takeaways from Facebook is it further reinforces the point that this is a “very new area,” Hardoon said in an interview with Bloomberg Television. Companies and regulators are “still figuring it out” and along the way, mistakes happen, which underlines the need for regulators to be proactive in guarding against them, he said. Bloomberg News

Local group looking to exploit structured finance opportunities T

here is a group of wellconnected men and women looking to exploit opportunities for structured finance in the countr y and in emerging markets across Asia and elsewhere. They already helped craft the capital requirements of local and overseas entities as San Miguel Corp. and various other business operations in Turkey, Chile, Ecuador and Brazil, where they functioned as advisors to funders. In the Philippines the group, known as is2cp, looks to apply their extensive experience in structured

finance in the areas of insurance, media, the medical and technolog y fields, and even transportation. In essence, structured finance is one created to help transfer or manage such risks as exchange or interest rates, political risks and others by using complex business and legal entities. They may use traditional offerings like bonds and equities or craft alternative tools to mitigate the risks involved. Some of the more known structured finance tools include credit default swaps, or CDS, popularized by financial engineers at JP Morgan.

The local group has partnered with foreign and local accountants and law yers to help them executive complex financial transactions that help put the Philippines on the structured finance map in emerging markets. Its partners include, among others, the is2 Holdings base in Morris Town, New Jersey; CKRE in London; Investors Advantage Reinsurance in Bermuda; and Archstone Partners Lp, Llc. in Chicago. is2cp in the Philippines is chaired by Maria Theresa G. Jalandoni.

Financial options (The value of variable universal life insurance) Metrobank successfully completes ₧60-billion stock rights offer

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isdom has it that hindsight is 20/20 vision. Amid various business cycles, global and market uncertainties, such vision can be murky and muddled. Yet, to the experienced who have been there and done it, one can see through the opaque and volatile market environment. There are some fundamental market lessons in life we can look back to and use as a guide to maneuvering our way to where one may not dare to journey. Life is one big business and market cycle. So it goes, what goes up must come down, and what is down will go up! Thus, the dictum—sell high and buy low. Yet, it is easier said than done. That is why for all who make business and market (investment) decisions, a basic understanding of that cycle is imperative. One need not worry and get bogged down in the market details, but it is only necessary to grasp the basic workings of the market to be able to put things in one’s hand and confidently make diligent decisions. Hindsight tells that market cycles keep coming back and that is why the saying, history repeats itself. Yet, a clear lesson is that cycles are never flat and over time continue to go up. This is why it has been said by elders, start saving while you are young and keep saving patiently...step by step, building it up block by block! But not too many listen to this advice due to many distractions. Oftentimes, we learn the hard way and do it after a painful lesson, realizing the need to save for the rainy days. But, better late than never. In time, we learn that we can accumulate savings in various ways and paces. We realize that by conservatively saving, we can possess sure and safe wealth. We also know that had we been more aggressive in

FINEX free enterprise Omar T. Cruz investing our hard-earned savings, we could have amassed much greater wealth. And yet to the cunning saver and investor, he or she will only do what is comfortable and that which allows one to sleep well at night. We also realize in life that our wealth can be vulnerable to external and market risks. Our hard-earned savings (in bonds) can lose value if interest rates shoot up. For that matter, for the risk-taking investor, accumulated wealth in riskier assets like stocks, their net asset value can come down precipitously. But we also know over time that the storm passes and we are able to weather the market vagaries. These realities are not only true for our wealth but for our health, as well. Isn’t it a lot easier to understand now why protection in both wealth and health makes a lot of sense? As it goes, it is better to pay a small premium to insure one against such risks for a much bigger reward in the eventuality that a market event affects your investments or a health accident or death comes by! We are now also convinced that planning for such eventualities is a must. Given these considerations, I have found the variable universal life (VUL) as a useful tool to invest my funds in and get a built-in hedge against accident, death, health/critical illness, insufficient retirement proceeds, liquidity for estate tax pur-

poses, and at some point an efficient way to transfer wealth without losing control of your assets. You can also pace your placements according to your cash position in your stage in life. Thus, initially when you are just starting, you may set aside funds for this on a regular and installment basis. At a more affluent stage in life, one may do single and bigger placements. This is also a financial option that allows you to switch underlying assets for free to time the market and give you the right to the above claims in the event of accident, sickness or death. Otherwise, like any other option, you can let it expire at your own choice. They manifest themselves as endowment, post retirement or trust funds as the purpose may be. Call to action: Pursue your financial and estate planning under the professional guidance of a licensed and experienced financial adviser, who can be a member of the Million Dollar Round Table club, or can be a certified wealth and estate planner. These professionals can add value to your financial and estate planning, including an update on the estate and other taxes on various financial options brought about by the recently legislated tax changes under TRAIN (Tax Reform for Acceleration and Inclusion). This is an excerpt from the Preface written for the book Dare to Journey: The Path to a Lifetime of Meaningful Wealth The writer is currently chief bancassurance executive of the Union Bank/Insular Life Bancassurance partnership. He was formerly president and CEO of BPI Philam Life Assurance Corp., and former National Treasurer of the Republic. otcruz1208@gmail.com

Metroplitan Bank and Trust Com (Metrobank) President Fabian Dee (from left), Metrobank Director and GT Capital Holdings Co-Vice Chairman Alfred Ty, Metrobank Vice Chairman Francis C. Sebastian and Metrobank Chairman Arthur Ty were all smiles as they rang the bell at the Philippine Stock Exchange in Bonifacio Global City after Metrobank successfully completed a P60-billion stock rights offer. network that has rapidly expanded in preceding etropolitan Bank and Trust Co. (Meyears. To that end, Metrobank intends to focus on trobank) announced the results of its enhancing customer experience through digitizaP60-billion stock rights offer after the tion initiatives and branch efficiencies and value offer period closed on April 4. The offer to eligipropositions to target clients. In addition, in order ble shareholders of 799,842,250 common shares to recognize additional earnings from Metrobank was priced at P75.00 per share. The rights shares Card Corp. and as part of Metrobank’s capitalare expected to be listed on the Philippine Stock planning initiatives and in line with their goal to Exchange on April 12. improve operational efficiencies, a portion of the The stock rights offer was taken up entirely offer proceeds will be used for the acquisition by the bank’s existing shareholders, with broad of the 40 percent equity stake in MCC, the final support seen across the shareholder base resulttranche of which is set to be completed by the ing in a substantial oversubscription. Metrobank third quarter of 2018. believes that the success of the offer represents The additional capital from the stock rights a strong vote of confidence from investors in the offer is expected to further enhance Metrobank’s bank and its strategy. capital ratios, keeping it well above the PhilipMetrobank also believes that the robust pine Basel III requirements. Pro forma for the growth of the Philippines will continue to support stock rights offer, Metrobank had a total capital loan expansion across the various segments of the adequacy ratio of 18.1 percent, and common eqeconomy. Metrobank seeks to capitalize on the uity tier 1 of 15.6 percent as of December 31, 2017, growth opportunities of large cap corporates and both ratios above the Bangko Sentral ng Pilipinas especially in its core franchise, the middle market requirements, inclusive of the D-SIB buffer. and small to medium enterprises (SME) segments. The stock rights offer was led by UBS as Rising per-capita levels also bode well for the pojoint global coordinator, joint bookrunner tential in the growing consumer space, specifically and international underwriter and First Metro in credit cards, auto loans and home mortgage. Investment Corp. as joint global coordinator, The capital-raising exercise is expected to enjoint bookrunner, issue manager and domestic able Metrobank to pursue these business proslead underwriter. DBS acted as comanager and pects to sustain the loan-growth momentum, co-underwriter. leveraging on the bank's sales and distribution

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www.businessmirror.com.ph

Editor: Dennis D. Estopace • Friday, April 13, 2018

A9

Chico River irrigation, other projects get Negros Oriental officials ban coal going as PHL, China ink loan agreement By Lenie Lectura

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By Rea Cu

@ReaCuBM

HE Chico River Pump Irrigation (CRPI) project and at least four other government ventures received a boost after Finance Secretary Carlos G. Dominguez III and Chinese officials signed in China on Tuesday a $62-million loan agreement. The deal is centered on funding the construction of the CRPI. The officials also signed a separate accord on economic and technical cooperation providing for a $79-million grant for other projects undertaken by the Philippine government in cooperation with China, the Department of Finance (DOF) said. The DOF added Dominguez signed on behalf of the Philippine government the Preferential Buyer’s Credit Loan Agreement

on the CRPI project with Chinese Ambassador to the Philippines Zhao Jinhua, representing The Export-Import Bank of China. Dominguez also signed the “Agreement on Economic and Technical Cooperation” with China Commerce Minister Zhong Shan at the sidelines of the fourday Boao Forum for Asia held in Hainan. The two accords comprise two of the six agreements signed by the two countries during the visit

of President Duterte to China. During that visit, Duterte met with Chinese President Xi Jinping and attended the annual forum held at the coastal town of Boao in this Chinese province. The DOF said the $62.09-million (about P3.135 billion) loan agreement on the CRPI project, which will be implemented by the National Irrigation Administration, covers 85 percent of the total contract amount of $73.04 million or approximately P3.689 billion. The total project cost is $86.57 million, or P4.372 billion. The interest rate on the USdollar denominated loan is 2 percent per annum, with a maturity period of 20 years, inclusive of a seven-year grace period. Meanwhile, the Agreement on Economic and Technical Cooperation involves a 500-millionrenminbi grant, approximately $79 million, to finance the following projects and activities. These include the Binondo-Intramuros and Estrella Pantaleon

bridges in Metro Manila of the Department of Public Works and Highways at RMB 264.8 million, partial funding; the feasibility study for the Davao City Expressway Project of the DPWH at RMB25.83 million; the provision of radio and broadcasting equipment to the Presidential Communications Operations Office at RMB17.82 million; and the Philippine-Sino Center for Agricultural Technology-Technical Cooperation Program Phase III of the Department of Agriculture at RMB27.52 million. The total grant for the four projects amounts to RMB335.97 m i l l ion, w it h t he rem a i n i ng amount of RMB 164.03 million under the RMB 500-million grant, will be used to finance other projects, according to the DOF. The Boao Forum for Asia is an annual event wherein government and business leaders in the region meet, to further promote economic exchange, coordination and cooperation within Asia and other parts of the world.

@llectura

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HE provincial board of Negros Oriental has issued a resolution that effectively prohibits the use of coal as a source of energy. Executive Order 9 declares Negros Oriental as an “Environment-Friendly and Clean Energy Province.” This means the local government of Negros Oriental will no longer issue any permit, authorization or endorsements that suppor t develop ment and operation of coal-fired power plants. The province now joins Guimaras, Sorsogon and Ilocos Norte as pioneers in the movement for a clean-energy Philippines. “The Province of Negros Oriental has opted to utilize clean and renewable energy in its 19 municipalities and six cities to support economic growth and to deviate from activities harmful for the environment. As a step forward, the province will cease the use of coal as an energy source due to the posing

Rescued after 22 days drifting at sea, Indonesian may return home soon

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BUILDING INVULNERABILITY

This undated photo shows members of the Aeta indigenous people selling different root crops and papaya fruit at the Angeles Public Market. In the 2017 Socioeconomic Report of the National Economic and Development Authority launched on April 3, indigenous peoples like the Aeta are cited as beneficiaries of government’s Comprehensive Sexuality Education strategy for vulnerable groups in view of achieving demographic dividend. Laila Austria

Beneficiaries in NegOcc get ₧23.5-M CSFs—DAR

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ACOLOD CITY—The Department of Agrarian Reform (DAR) turned over P23.5 million worth of common service facilities (CSFs) to five agrarian reform beneficiaries organizations (Arbos) in Negros Occidental on Wednesday. The turnover and trust agreement signing rites were led by DAR-6 Regional Director Stephen Leonidas and Assistant Regional Director for Support Services Antonio del Socorro. Gov. Alfredo Marañon Jr. and Silay City Mayor Mark Golez received the symbolic key to the facilities on behalf of the beneficiaries under the

coverage area of the DAR-Negros Occidental I. At least 200 member-beneficiaries from the five northern Negros Arbos cultivating almost 249 hectares of sugarcane and other crops will benefit from the farm machineries distributed under the agency’s Sugar Block Farm (SBF) and Climate Resilient Farm Productivity Support (CRFPS) programs. Recipients under the SBF program were the Progreso Agrarian Reform Cooperative from Barangay Kapitan Ramon in Silay City, which received a unit of farm tractor along with a sixwheeler dump truck, disc plow, disc

harrow and 5-tonner trailer; and the Don Esteban Agrarian Reform Cooperative from Barangay Jonob-jonob in Escalante City, which obtained one unit of six-wheeler dump truck. Under the CRFPS, beneficiaries were the Hagnaya Agrarian Reform Cooperative from Barangay Tabunac in Toboso town; Caridad Farmers Association from Barangay Luna in Cadiz City; and Camille-Reicon Farmworkers Association from Barangay E. Lopez in Silay City. Each of the three received one unit of farm tractor with implements, including disc plow, disc harrow and 3-tonner trailer. PNA

N Indonesian rescued on Tuesday after being adrift at sea for days would be sent home soon, according to authorities. The Joint Task Force Tawi-Tawi, which took custody of the drifter, had coordinated with local and Indonesian officials for his release. “We coordinated with the Interpol Tawi-Tawi and the Indonesian Border Crossing Station [BCS] for the background check of Fiter,” JTF Commander Brig. Gen. Custodio Parcon said. “Indonesian BCS personnel initially vouched for the subject’s nationality but reserved the final confirmation when authorities from Indonesia communicate their feedback.” The BCS was a product of the trilateral agreement the country entered into with Malaysia and Indonesia as part of the effort to stem the movement of terrorists at sea. “Since our trilateral cooperative arrangement is in effect, we are able to closely coordinate with our neighboring countries and address security concerns and other issues,” Parcon added. According to Armed Forces

Western Mindanao Command Spokesman Capt. Jo-ann Petinglay, Filipino fisherman Idris Elsan reported seeing a man inside a makeshift cottage that was floating in the coastal waters of Manuk Mangkaw, Simunul, Tawi-Tawi, at around 4 p.m. of April 10. The Indonesian identified as Eren Fiter was turned over to the police before he was transferred to the custody of the Joint Task Force Tawi-Tawi. Fiter was brought to the Simunul Municipal Police Station at around 7 a.m. on Wednesday after spending the night at his rescuer’s house. The Indonesian was initially given medical attention by the Simunul police before he was eventually turned over to the military personnel in Tawi-Tawi. According to Pentinglay, Fiter said his floating cottage was cut from its anchor on March 19 due to strong winds and cast away from shore. The Indonesian said he tried to get help from passing vessels and other seacrafts while adrift. However, he said he was unable to catch the attention of these vessels. Rene Acosta

Survey shows high awareness on HIV prevention in Region 8

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ACLOBAN CITY—The Philippine Statistics Authority noted a high awareness on human immunodeficiency virus (HIV) prevention among women in the Eastern Visayas region. Citing key indicators from the 2017 Philippines National Demographic and Health Survey, PSA Regional Director Wilma Perante said 73.5 percent of women in the region knew that consistent use of condoms is a means of preventing the spread of the sexually transmitted infection. About 87.9 percent of women

are also aware that limiting sexual intercourse to one faithful, uninfected partner can reduce the chance of contracting the infection. “About 70.1 percent knew that both using condoms and limiting sexual intercourse to one uninfected partner are means of preventing HIV,” Perante said in a statement sent to reporters on Thursday. Eastern Visayas ranked second among the regions with high proportion of women aged 15-49 years old with knowledge on effective HIV-prevention measures. PNA

impacts of its high carbon emissions on health and global climate, according to a statement. The new provincial executive order aims to support the national government in meeting its commitments in line with the Instrument of Accession to the Paris Agreement on Climate Change. The said agreement identifies the critical impact of climate change and the need to immediately address this issue through carbonemission reduction programs. With the decision to make its province coal-free, Negros Oriental strives for a more sustainable future to address the country’s looming environmental problems, preserve its own local natural resources and nurture a healthy well-being for its citizens. The preservation of Negros Oriental’s environment also supports the promotion of the country’s ecotourism that is truly one of a kind. Negros Oriental already hosts the 222.5-megawatt Southern Negros Geothermal Project of the Lopez-led Energy Development Corp.

Town to use P7.2-M mining taxes for health, livelihood devt programs

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T O G O N , B e n g u e t —T h e mu n ic ipa l gover nment of Ito gon i n B e n g ue t pro vince will use the mining taxes it received from Philex Mining Corp., as host to the firm’s Padcal Mine, mainly for health and livelihood projects. Itogon Mayor Victor io Palangdan said on Wednesday that part of the P7.2-million business taxes the town had collected from Philex for 2018 would be used to further the town’s feeding and nutrition programs. The town’s administration is also set to put up community livelihood projects, such as souvenir-item production, “ bigasang bayan” or cheap rice market, food processing and neighborhood retail stores. Palangdan added assistance to local farmers, especially in mitigating the effects of climate change, and other income opportunities, such as mushroom and flower production, are also being eyed. “ T here are many problems in our town that we need to address, like repairs of several public school classrooms and improvement of our tourism industry,” he added. The municipalities of Itogon and Tuba are host to the Padcal Mine, Philex Mining’s gold-andcopper operations in Benguet. “With our up-to-date tax payments, we fulfill our duties to our host and neighboring communities and help them develop and implement their various social projects on time,” said Roselyn Dahilan, the finance group manager of the mining site. PNA

A10 Friday, April 13, 2018 • Editor: Angel R. Calso

Opinion BusinessMirror

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editorial

Keeping a firm perspective

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F there is any particular intellectual failing in discussions about the Philippines in the press, media and on social media, it is the inability or unwillingness to put things in context and perspective.

For example, “Why can’t we be like Thailand?” Perhaps that is because Thailand has a King that is considered a near deity or demigod. Citizens go to jail for insulting the King. The Thai military has strong control of the government. Since 1932 Thailand has held 25 general elections and had 19 military coup d’états, 12 of them successful in overthrowing the elected government leader. For freedom of the press, Thailand is considered “not free” by the 2017 Press Freedom Index with a score of 77/100 with 0=Most Free, 100=Least Free. The Philippines scored 44/100 and has the highest freedom of the press score in Southeast Asia. And do not even mention conditions in Vietnam unless it is to talk of the 100 people executed for crimes each year. If we wish to speak of the economic success of Thailand, then we must first and always point out that a truck carrying a 40-ft shipping container can reach any point of the country within 24 hours. Here in the Philippines “any point in the country” from Manila is measured in days. Everything must be put in context and proper perspective, otherwise it is a false narrative. However, do not believe that near-sighted and narrow-minded thinking is unique to the Philippines. All nations are guilty of the same mistakes. Japan prides itself of being a nation that came from the ashes of World War II to become an economic powerhouse that has challenged both the West and East. Yet, it also tries to deny its own reality, as do all countries. The Japanese population is declining and will lose both economic and political influence in the years to come. Note this troubling condition. Japan’s prisons have become a last resort haven and shelter for its elderly women. Japan has the oldest population of any country with 27 percent of its citizens 65 or older, almost twice the share in the United States. Nearly 20 percent of all women confined as criminals are elderly, almost all of whom have been convicted of petty crimes like shoplifting. This is no accident. Elderly women in Japan are economically vulnerable. Half live below the poverty line. Many live by themselves and have no one to turn to for help. Bloomberg.com tells the story of Mrs. “F.” who was 84 years old the first time she went to prison. She stole rice and then shoplifted again to be able to go back to prison. “I didn’t want to go home, and I had nowhere else to go. Asking for help in prison was the only way.” Another woman —Ms. K, 74—said this: “I was living on welfare. When I’m released, I will manage to live with ¥1,000 [$9] a day. I don’t have anything to look forward to outside.” The moral of this story may be found in looking at Japan’s recent economic history, which it has chosen to ignore. The “boom” period of the 1980s was naturally followed by a period of “bust” as the economic and business cycle demands. Yet, Japan refused to change policies with the new conditions and has spent 30 years looking for economic glory in the same policies that led to its economic fall. You don’t know where you are going unless you remember where you came from. Since 2005

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Guns and accountability James Jimenez

spox

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omorrow, April 14, the 2018 barangay and Sangguniang Kabataan election period will start. On the same day, the gun ban will commence, bringing with it—among other things—the cancellation of all permits to carry, mission orders, letters of instruction and other similar documents granting individuals the authority to carry and transport firearms out of their homes and workplaces. Those who take issue with the ban argue that it only leaves legitimate gun owners defenseless against lawless elements. Apart from the fact that having a gun doesn’t necessarily make a person safer, this argument misses the point of the gun ban entirely. The election gun ban isn’t intended to combat criminality; any impact on crime levels is merely incidental to the reduction in the number of firearms in the wild. Rather, the gun ban is principally a means to ensure that the guns that are still around— courtesy of gun ban exemptions— are held by responsible individuals who, because they won’t be able to easily duck accountability for their actions, are not likely to abuse the firearms to coerce or intimidate voters, or otherwise affect the outcome of elections.

The Philippines has a long and checkered history of politicians using guns to sway the outcome of elections—especially local polls, which unfold away from the spotlight of the media and national attention. A gun need not be fired in order to have an effect; an unloaded pistol stuck in some goon’s pants can be intimidating enough to influence people who would have voted differently if they weren’t quaking in fear. That’s the reason why any two-bit politician who can manage it, invests his gold in some hardware and arms his goons. And no, existing gun laws don’t make that impossible at all. Without a gun ban, the number of firearms out in the wild directly corresponds to the availability of officially issued permits to carry (PTCs). Under existing law, that

Short pain, longer gain Edgardo J. Angara Continued from A1

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N May 2016 Thai officials ordered the indefinite closure of Thailand’s “most beautiful” Koh Tachai Island, a popular diving site in the Similan National Park on the Andaman Sea. The move was to protect the island’s beaches and coral reefs from any further damage wrought by tourists, whose huge numbers were too much for the local ecosystem to handle. Thai experts measured that a beach in the island should only hold up to 70 visitors on average. But before the closure, more than 1,000 visitors would be at the island at any given time. Less than two weeks after Koh Tachai’s closure, three more islands—Koh Khai Nok, Koh Khai Nui and Koh Khai Nai, which are accessible from Phuket—were also

shuttered for the same reason. Thai officials reasoned that the temporary closure would allow the islands’ ecosystems to replenish and would help prevent any permanent damage

number can be effectively kept low because technically only the chief of the Philippine National Police (PNP) can issue PTCs. With a single source of authority to bear firearms, it ought to follow that the identity of everyone with a gun would be a matter of record, and that any untoward incident involving abusive use of the weapon would be easily traceable back to the miscreant. Accountability, in other words, is clear. But in reality, the PNP chief isn’t the only one who can authorize people to carry firearms. Under PNP Circular 2000-016 dated December 11, 2000 (as amended by PNP Circular 2002, 2002-A and 2004-A), a whopping 30 categories of persons are actually authorized to “issue mission orders/letter orders which may entitle the bearer thereof to carry his issued/licensed firearm and ammunition.” Thirty categories, covering at least 69 individuals and various subcategories, like “regional directors” and “commissioners.” To say that this proliferation of sources of authority can result in tangled lines of accountability is an understatement. Under such circumstances, any goon with a gun can simply wave an official looking document around and thump his chest about some “secret mission” that no one would have the means to quickly validate. In the meantime, the firearm or deadly weapon will have achieved at least one of its desired effects: intimidation.

And in the context of elections, intimidation is a most puissant tool. While I have no doubt that none of these authorized individuals will be issuing PTCs and mission orders whimsically, the fact remains that with so many firearms being carried around, it is inevitable that some of them will eventually end up in the hands of people who have no business being armed. By cancelling all current PTCs and mission orders, the gun ban for a very brief period drastically reduces the availability of these authorization documents, and so radically simplifies the lines of accountability. If only the Comelec can permit persons to carry firearms, then anyone who displays a firearm must be easily identifiable and must have some easy-to-verify official function that justifies possession of the firearm. This empowers ordinary citizens to stand up to gun-toting goons by giving them a clear path toward exacting accountability. And when the goons are stripped of the ability to carry guns around with impunity, then the elections stand a better chance of resisting the corrosive influence, not just of guns, but also of goons and gold. So you see, the gun ban isn’t about leaving law abiding citizens defenseless. It is about making sure that ordinary voters—themselves law abiding—are protected from those who would use guns to scare, intimidate and coerce their way into elected office.

Boracay belongs to the top 10 beach resorts in the world. It’s a natural treasure. It should be declared a protected natural area under the National Integrated Protected Areas System law. The government and local officials, landowners and renters, environmentalists and academics should all sit down in a roundtable and seek the best solution.

Between January and February this year, Colombia closed off its Tayrona National Park, located in Santa Marta on the country’s northern coast. Colombian officials explained in a statement that their move was “to give a rest to the ecosystem of the protected area.” Apparently, this move has already been done by Colombian officials several times before. Boracay belongs to the top 10 beach resorts in the world. It’s a natural treasure. It should be declared a protected natural area under the Nipas (National Integrated Protected Areas System) law. The government and local officials, landowners and renters, environmentalists and academics should all sit down in a roundtable and seek the best solution. Saving a natural treasure is worth the brainstorming and time needed to restore it.

from over-tourism. The same was done recently to Koh Phi Phi Island’s Maya Bay, which was popularized by the 2000 movie The Beach starring Leonardo DiCaprio. The scenic beach will be closed from the beginning of June to the end of September this year to allow officials to clean up the heaps of garbage left by the 4,000 tourists who visit the site each day.

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Opinion

More steam ahead

Don’t let’s do anything

BusinessMirror

Alvin P. Ang

Tito Genova Valiente

EAGLE WATCH

annotations

N February 26 we were invited to serve as resource persons for the Senate Committee on Economic Affairs. Chaired by Sen. Sherwin T. Gatchalian, the main purpose of the hearing was to give an update of the current economic assessment by the National Economic and Development Authority (Neda) and, at the same time, review the initial impacts of the Tax Reform for Acceleration and Inclusion (TRAIN) law.

E are a noisy nation. We are, contrary to what sociologists speak about us, confrontational people. Somebody speaks out his thoughts and, immediately, we respond to that thought with our thought, because our thought is better.

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Gatchalian explained that the inflationary effects of the TRAIN law need to be carefully analyzed in order for the government to make a proper response if it overshot original estimates. This is particularly of concern for the poor who are not in any way benefiting from the personal income-tax cuts, but will be directly affected by the pass-through effects of additional taxes on oil, electricity and sugarsweetened beverages. The Department of Finance, Bangko Sentral ng Pilipinas and other government agencies were also in the briefing. The main conclusion of the meeting was that the TRAIN has not yet affected prices substantially. It is possible that the increase in global oil prices and the depreciation of the peso had more to do with the higher than expected inflation. Furthermore, it is possible that the additional inflation was caused by perceptions and expectations. In our column two weeks ago, we explained that our base estimate for inflation with the initial impact of the TRAIN is 3.4 percent for January. As the actual had reached 4 percent, it is plausible that the increase was due to expectations causing businesses to increase prices even before they get the new stocks. This has led to a domino effect affecting other goods and services. What has actually happened is that people were caught unaware of the actual benefits they could get and costs of the TRAIN through inflation. The rise in prices is largely a communication and coordination failure. We have warned that the news of lack of National Food Authority rice in the market could lead to further high prices simply because of delayed local and imported procurement. It is not that NFA is not aware of the need for buffer, but the timing is critical, as rice contributes about 10 percent to inflation. All the good intentions

of the TRAIN law are being challenged by these failures. We were not surprised that the February inflation rate breached 4 percent even with relatively lower oil prices, as the lowest rice prices increased by about P5 or about 16 percent. We accurately forecasted it to hit 4.5 percent using 2006 base year. Dr. Dennis Mapa, Dean of the University of the Philippines School of Statistics, presented the impact of the January inflation to the poor or bottom 30 percent. He noted that the inflation of the poor is higher than the headline inflation of 4 percent. He cited past data showing impact of inflation on the poor—it is seen to slow down poverty reduction. Considering that 2018 is a survey year of the Family Income and Expenditure Survey, survey in which we draw and estimate poverty rates, as well, a high inflation for the poor may impact negatively the efforts to lower poverty to below 20 percent. His estimates also showed that the unconditional cash transfer for 10 million poor families of P200 per family per month may not be enough to cushion faster price increases. With these information, it is critical for the government not to allow more steam ahead from the TRAIN. It should work to ensure that the price of rice becomes affordable through stable and available supply. It was common agreement that tariffication of rice is a better measure than quantitative restrictions and that it should be done the soonest. Also, it must utilize its communication and coordination mechanism well. A clearer and more basic explanation of the TRAIN must continue to the public utilizing all forms of media. The full effect of the TRAIN will take some time possibly hitting the most from May to August when summer vacation is about to end and schools open. The government should not wait till then to respond. It must start now.

Europe’s digital tax is a bad idea

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he European Commission’s proposed tax on digital services is intended to make companies like Google and Uber pay more. The idea is that such firms are gaming the rules at the expense of other taxpayers. The issue is real and needs to be addressed— but the answer under discussion breaks with both established international practice and plain common sense. Formal talks on the plan are due to start this week. The commission is calling for a 3-percent tax on the turnover of large digital enterprises—those with European Union digital revenues over €50 million ($40.5 million) and total global revenues of over €750 million. About half the companies affected would be American, the EU estimates. The commission says it has been left with little choice. The value generated by digital companies doesn’t require a physical presence, making them harder to tax. Digital businesses arrange their affairs to exploit this: They allocate income to low-tax jurisdictions and, according to officials, end up paying an effective tax of roughly 10 percent of profits, less than half of the burden carried by traditional businesses. (One recent study disputes these numbers.) Officials acknowledge that the right solution is a thorough overhaul of the corporate tax code, especially as it affects international firms selling digital services—and that this should be done not unilaterally but in cooperation with other countries, notably the United

States. Efforts are, in fact, underway, but progress has been slow, and EU officials have chosen to do something, anything, as soon as possible. Doing nothing would be better than this. For a start, the plan wouldn’t raise much revenue—a meager €5 billion each year. And this supposedly fairer tax would create many new anomalies. For instance, companies like Uber that don’t make money will have a new cost to absorb; highly profitable firms with market power, such as Facebook, will be able to pass the tax on to their consumers. Small start-ups will be exempt from the new tax—unless they’re acquired by larger companies. That will discourage consolidations. And the proposal as it stands may tax more activities than intended: Some financial services, for example, seem to be within its scope. In its zeal to tax Big Tech, the commission swerves around many of its own stated principles. Its plan would probably require accessing individual, not just anonymized, user data. This runs counter to the EU’s stringent new rules on privacy, coming into force next month. Efforts to design a multinational solution need to be stepped up, not set aside. The goal should be a fair, multilateral framework that recognizes the complexity of the new digital economy while respecting the sovereignty of nations to set their own tax policy. That’s an international challenge demanding an international solution.

Bloomberg View

Friday, April 13, 2018 A11

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We are vociferous online. Think of those busy intellectuals who have, it seems, all the time in the world to comment on arts and the lack of it in our life, on books and films and which medium tells the better story, on dead politicians and dead trees and who present the better heroism. The topics and themes are endless, and we are the immortal commentators, unceasing and undying, the raconteur more expansive than any expanding universe because we have all the words at our disposal. Up to a point. He or she who has the best language wins. Nah, not really. This is not true if we are to base our notion of the good thinker with the best words. Believe me, something is happening now in the technological ether. The battle being fought over the Internet is not a game of notions but a war of noise. Who is louder and who is loudest—those are two of the main issues. Online, the discourses lose to curses: think of those videos going viral, where a man starts his spiel with recognizable sentences, with verbs and adverbs intact and alive, with adjectives spilling as if a spring has been violated somewhere by someone who has found the origin of letters. Then, from the peripheral

vision of the omnipresent camera— actually a mobile-phone camera— someone unseen, the scary disembodied voice releases a contrary position, and ends that opposition with “Bobo [Dumb]!” The person who has been at the center of this documentation will not take that with a smile. He instinctively terminates his relationship with sentences and phrases and screams back: “Mas bobo ka [You are dumber]!” It does not end there. The offended party, who was offensive with his dumb opinions, calls in his mother to help him. Let me rephrase that: the offended party hauls in the image of mothers by shouting with all the moral might he could muster: “P____g ina mo [Your mother is a whore]!” Everything stops there or could stop there. Here is a tip: you could continue and be mightier by also shrieking: “P____g ina mo rin [Your mother is also a whore]!” Odd as it may seem, the nationalist wins in this banter. Notice how the English (my English) translation weakens the response because of the “also.” Be the first to curse another man’s mother, and you win. You get the lesson? We can call each other names, and we can hurl all kinds of invectives against each other, but nothing seals the fate of one’s acclaimed, perceived,

declared stupidity than bringing in and bringing down one’s mother. It is not the father that matters. You can call another man’s father a thief but, darling, it does not play. You can even call each other a thief or murderer and nothing happens. We can write with grace about the evil in a man’s heart, but it will never get the attention as when someone bellows: “Demonyo [Devil]!” You can defend your favorite politician, but your treatise pales beside the more accessible, popular “Gago [Stupid]!” Of course, there is always that expletive about one’s mother, which, in our culture, is the sordid winner. Now, if you are a female politician, your supporters are de-facto losers in the screaming contest because you can always be called a “p__a!” In this our culture of misogyny, chauvinism sits idly side by side with chivalry. Communication over the Internet is really overrated. The so-called thread is not woven seamlessly because, as you spin your wheel, another creates another thread. Have you seen this happen: You post your photo or something about you or your event, then someone reacts to your post and another responds to the post of another person’s post? In other words—and very few people

A journey toward Servant Leadership Rev. Fr. Antonio Cecilio T. Pascual

SERVANT LEADER

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or the Lord gives wisdom; from His mouth come knowledge and understanding.” (Proverbs 2:6) My dear brothers and sisters in Christ, as we continue our journey in the ordinary time, let us all rejoice and celebrate the importance of knowledge and wisdom in our life. Let us acknowledge the sacrifice and hard work of everyone to achieve their dreams in life.

This year is an important season for all of us in Caritas Manila, as some of our youth under Youth Servant Leadership and Education Program, the flagship program of Caritas Manila, will successfully graduate for

the school year 2017-2018. “Day after day, they pour forth speech; night after night, they reveal knowledge” (Psalm 19:2). It is really grateful that “the spirit of the Lord rest on them—the spirit of wisdom

and of understanding, the spirit of counsel and of might, the spirit of the knowledge and fear of the Lord.” (Isaiah 11:2) It is, indeed, that “gold there is, and rubies in abundance, but lips that speak knowledge are a rare jewel” (Proverbs 20:15). The knowledge that we have is a gift from the Almighty Father so that we will be able to spread His words. Recognizing this important season, we in Caritas Manila would also like to express our gratitude for those who continuously support and help our youth in becoming servant leaders of our society. It is also a fact that “whoever has a bountiful eye will be blessed, for he shares his bread with the poor” (Proverbs 22:9). Let us all remember that “for wisdom will come into your heart, and knowledge will be pleasant to your soul; discretion will watch over

seem to realize this—you initiate a “talk,” and two people who see each other below your “talk” begin their own talk. It is disrespecting you but, who cares, respect has no place in the Internet. For all the magnificence of nothingness in Samuel Beckett’s Waiting for Godot, we know where his heart goes. Vladimir and Estragon, with nothing else to do, decide to pass the time by “abusing each other.” They start cursing each other: VLADIMIR: Sewer-rat! ESTRAGON: Curate! VLADIMIR: Cretin! ESTRAGON: (with finality) Crritic! VLADIMIR: Oh! He wilts, vanquished, and turns away. We can kill each other, conquer each other with well-chosen words or, as in this exchange, with the abuse and surplus of words. In our case, language has failed us. The action, the gestural has not accomplished anything in our land, and so we look to language to rule. But, even languages have no place in our land. In such a case, we can be Estragon and say, also with finality: “Don’t let’s do anything. It’s safer.”

E-mail: titovaliente@yahoo.com.

you, understanding will guard you” (Proverbs 2:10-11). Let us all take this season as an opportunity to continuously develop and build our community with compassion, mercy and charity. We are encouraging all the Catholic faithful to support and join us in making our youth as the hope of our society. May the Almighty Father continue to prosper you and bless your generosity to your brothers and sisters. To know more about Caritas Manila, follow us on Facebook: CaritasManilaInc. For your donations, please call our DonorCare lines 563-9311, 564-0205, 0999-7943455, 0905-4285001 and 0929-8343857. Make it a habit to listen to Radio Veritas 846 in the AM band, or through live streaming at www.veritas846.ph, and follow its twitter and instragram accounts @veritasph and YouTube at veritas846.ph. For comments, e-mail veritas846pr@gmail.com.

China is nationalizing its technology sector By Christopher Balding Bloomberg View

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S Bloomberg News reported this week, a key stumbling block in trade negotiations between China and the United States has been Beijing’s extensive support for its technology firms. But if President Donald J. Trump’s administration thinks that will change any time soon, it hasn’t been paying attention: Far from reducing support for the tech sector, China is on the verge of nationalizing it. By many measures, China’s tech companies seem unstoppable. Private equity and venture-capital investment grew from $14 billion in 2012 to $120 billion in 2017. Last year 34 Chinese companies joined the elite ranks of start-ups valued at more than $1 billion, second only to the US. From health care to bike-sharing, Chinese companies are improving on ideas from overseas and innovating in their own right. And it’s not just start-ups. China’s established tech firms—notably Baidu, Alibaba and Tencent, or the BATs—are experiencing enormous growth, as well.

Tencent Holdings Ltd., with nearly 1 billion users, reported that its net income almost doubled in the last quarter, to $3.3 billion. Alibaba Group Holding Ltd., which dominates online retail, is expecting growth of 55 percent this year. Investors may worry about Chinese debt, but they’re giddy about Chinese tech. At first glance, this rapid growth would seem to dovetail with the government’s efforts to prove its market bona fides. China regularly pushes for recognition as a market economy at the World Trade Organization, while touting the benefits of “supply-side reform” at home. In a speech at the most recent Communist Party Congress, President Xi Jinping pledged to “support the growth of private businesses.” Look beyond such rhetoric, though, and a very different picture emerges. Communist Party committees have been installed at many tech firms, reviewing everything from operations to compliance with national goals. Regulators have been discussing taking a 1percent stake in some giants, including Alibaba and Tencent, along with a board seat. Tech companies have been widely

encouraged to invest in state-owned firms, in the hopes of making them more productive. The common denominator of all these efforts is that the government wants more control. An executive at a Chinese search engine recently summed up the new dynamic: We’re entering an era in which we’ll be fused together. It might be that there will be a request to establish a Party committee within your company, or that you should let state investors take a stake, you know, as a form of mixed ownership. If you think clearly about this, you really can resonate together with the state. You can receive massive support. But if it’s your nature to want to go your own way, to think that your interests differ from what the state is advocating, then you’ll probably find that things are painful, more painful than in the past. This quasi-nationalization applies to China’s start-up scene, too. One recent report found that 60 percent of Chinese unicorns have either direct or indirect investment from the BATs. China’s venture-capital sector is dominated, not by traditional tech dealmakers but by the state: There are more than 1,000

government-owned VC firms in China, controlling more than $750 billion. All this has direct consequences for the trade dispute with the US. A recent research note from Natixis SA found that 70 percent of the products targeted by the Trump administration in its initial tariff list fall under the China Manufacturing 2025 initiative, which aims to support Chinese companies in 10 high-tech sectors, including robotics and biotechnology. If Beijing insists on protecting those industries—as it gives every indication of doing—significant progress on trade talks seems unlikely. Perhaps a bigger worry for China, though, is that this creeping nationalization could harm its most dynamic companies. Lavishing the new national champions with handouts—such as cheap loans and employment subsidies—could turn them into rent-seekers. More bureaucracy could mean less efficiency and growth. Firms may start currying government favor rather than taking risks and innovating. Tech could become the new coal. And that wouldn’t be in anyone’s interest.

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Bautista: Ruling on jet fuel-tax refund big help to PAL’s profitability By Manuel T. Cayon

@awimailbox Mindanao Bureau Chief

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AVAO CITY—Flag carrier Philippine Airlines (PAL) is hoping for a quick processing of its P900-million tax refund, noting its impact on the company’s expansion plans and profitability this year. Dr. Jaime J. Bautista, PAL president and COO, said they are ready to work with the government in the implementation of the April 3 decision of the Court of Tax Appeals (CTA) ordering the Bureau of Internal Revenue (BIR) to return nearly P900 million in excise tax. “Of course, we wanted it paid immediately. But we can work with the BIR or whatever government agencies are tasked to work with us [on the refund],” he said on Thursday on the sidelines of the news conference introducing its new fleet of 86-seater new generation Q-400 Bombardier here. Bautista noted that the CTA Third Division ruling only vali-

dated PAL’s insistence that its importation of the of Jet A-1 fuel between February 2003 and December 2004 was covered by provisions on exemption from fuel ta x under Section 13 of Presidential Decree (PD) 1590. Part of the CTA ruling said PAL had complied with the requisites for exemption from payment of specific taxes on its importations of Jet A-1. The CTA said the collected specific tax that should have been exempted amounted to P897,445,271.84. PD 1590 allows exemption from taxes on all importation when the items are used in transport and nontransport operation, and there are no locally available

BAUTISTA: “P900 million is almost $20 million, and the profitability of an airline is not really that big. So, it would really help.”

supply in reasonable quantity, quality or price. PAL had sought P953,820,553.84 in refund, but the court excluded P56,375,282 in Jet A-1 excise tax, which was not supported by pertinent revenue declaration. “That would only show that we have franchise to operate and import jet fuel, and the court ruling affirmed that the jet fuel was to be imported because it found out that even the local supply available was also imported,” he said. He added that a quicker payment of the refund would matter much to PAL “considering that last year was not really a good year for us.” He earlier disclosed in a news briefing here that PAL sustained a revenue decline of P7 billion. “P900 million is almost $20

million, and the profitability of an airline is not really that big. So, it would really help,” he said. The order to refund PAL would also have a huge bearing on the company’s aggressive expansion program with focus on adding flights from its hubs outside the Ninoy Aquino International Airport, and the start of payment of its new deliveries and incoming acquisition of aircraft to support the opening of new routes from its hubs in Clark, Pampanga, Cebu and Davao. The new aircraft include the quieter new-generation Q400 Bombardier turboprop for nonmajor destinations, the 295-seater luxurious Airbus 350-900 series and additional A321 Neo to serve Asian destinations. Its expansion and promotion program was started two years ago to reassert its dominance as the local airline with the largest fleet, at 85 aircraft. “The four-star rating was the fruit of two years of transformation in fleet, cabins, products and service that demanded millions of dollars in hard investments,” he said.

Luzon power grid placed on yellow alert By Lenie Lectura @llectura

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he National Grid Corp. of the Philippines (NGCP) declared the Luzon power grid under yellow alert for three hours on Thursday because of power-supply shortage. A yellow alert means there are not enough reserves to cover the largest running generating unit at the time, but does not necessarily lead to power outages. For the Luzon grid, this is usually 647 megawatts (MW), or one unit of the Sual power plant. The yellow alert took effect from 1 to 3 p.m. “Luzon grid is on yellow alert due to the unexpected shutdown and limited generation of some power plants,” the NGCP said. Data had it that capacity stood at 10,740 MW, while peak demand was recorded at 9,654 MW, leaving reserves at 416 MW. The thin reserve was brought about by the scheduled and unplanned shutdowns of power plants. The plants that went on forced shutdown are Makban Unit 5 (55 MW), SLPGC 1 (150 MW), SLGPC 2 (150 MW), Malaya 2 (320 MW) and San Gabriel (420 MW), Ilijan Block A (500 MW) and Makban Unit 2 (50 MW). Also, there are plants whose capacity was derated. These are Calaca Units 1 and 2 at 230 MW and 220 MW, respectively, and Malaya 1 (150 MW). Meanwhile, the plants that are on planned outage are Angat M Unit 3 (50 MW), San Roque Unit 3 (145 MW), Magat units 1&2 (180 MW) and Pagbilao Unit 1 (383 MW). Angat will be online on July 30, while San Roque will resume on September 9. The Magat facilities will be online on April 17. Pagbilao, on the other hand, will resume on May 1. In the evening of Thursday, the NGCP expected a “normal” power situation in Luzon.

house of dakay Francisco Estrella stands at the door of the heritage house in Batanes where his family has lived for generations. Originally owned by Luisa Estrella in 1887, it was passed on to her favorite nephew, Jose Dakay Estrella, after whom the house was named. Francisco now takes care of the House of Dakay. On September 13, 1918, an earthquake hit the island, but the House of Dakay—along with four other houses —remained standing. The walls of the house are very thick and made of stone and lime. The roof is made of cogon grass about a third of a meter thick. The House of Dakay is recognized as a World Heritage building by the Unesco. Stephanie Tumampos

TPB to bring lowly ‘carinderia’ food to the world Continued from A1

She added that the TPB is eyeing to bring the event to “key markets” abroad to further promote Philippine cuisine. TPB, the marketing arm of the Department of Tourism (DOT), usually promotes the Philippines by participating in travel fairs and expos in Europe, Africa, the Middle East, India, North Asia, the Asean and Pacific region, the United States and Canada. Buhay Carinderia Redefined, formerly Carinderia Fiesta, has been an advocacy of Erlinda Legaspi, president of Marylindbert

International Inc., since 2011. “The carinderia has been around since the 1800s,” she explained during the event’s launch, “offering home-cooked food that pays homage to the family culinary tradition. These are dishes and recipes that had been handed through generations.” Over the years, she added, the project was able to “discover culinary talents” and carinderia like Sisig Avenue, Lance and Laurenz Food Express, Bulaluhan sa Bulihan, etc. She said the festival this year will start in Vigan, Ilocos Sur, in

June: “Individuals will go around Vigan, identify the best dishes there and the best carinderia.” Fourteen other provinces that comprise the Ilocos, Cagayan Valley, and Cordillera Administrative Regions will also be visited. Legaspi said, “These local culinary experts will then gather at the Vigan Convention Center on June 28 and 29, where they will not only share their talent to everyone, but also interact with chosen students of the area through mentoring partnership, so they could also pass on their skills and experiences.” See “TPB,” A2

www.businessmirror.com.ph

Duterte pivot to Beijing starting to bear fruits

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resident Duterte was full of praise for Beijing and even declared his love for Chinese President Xi Jinping, as he embarked on his third visit to China this week to foster warmer ties strained by a territorial dispute in the South China Sea. “More than anybody else at this time of our national life, I need China,” Duterte said at a briefing on March 9, adding that China’s help is a “very important ingredient” in his $180-billion infrastructure push. Almost two years into his presidency, Duterte’s pivot to China is showing some signs of economic payoff, particularly in tourism and investment. Even so, the country continues to rely heavily on its traditional trading partners like Japan, the US, South Korea and the Netherlands.

Bill of Rights. . . Continued from A1

resources so that these rights will benefit the poor.” He noted that the biggest problem besetting these three sectors is lack of funds. At present, only civil and political rights are listed under the Bill of Rights. The Con-com is set to decide on the exact wording of the self-executing provisions on socioeconomic and environmental rights in an en banc decision this week. The panel aims to submit its final draft of the federal charter to the President on July 19, days before the Chief Executive’s State of the Nation Address on July 23. “It would also encourage Congress to make the proper appropriations in order to be able to satisfy the grant of this most basic socioeconomic rights,” Puno said. Commission on Higher Education (CHEd) Commissioner Ronald L. Adamat hopes that their challenge on lack of budget will somehow be solved once the right to education is enshrined in the Bill of Rights. “It all boils down to budget, be it with CHEd alone or with different state universities and colleges across the country. The bottom line is budget,” he said. “If the schools have a meager budget, then they cannot provide state-of-theart facilities, and [if the] facilities are not state-of-the-art, then that is tantamount to less quality of education.” Adamat added that the inclusion of socioeconomic rights under the Bill of Rights is a “triple victory for the Filipino people, particularly to those coming from the poor families.” “Now with this proposal to include [right to] education in the Bill of Rights in the [new] constitution, all the more that it will be given emphasis by the government because this becomes a very important and basic right of the citizenry,” he said. Asked if he has any specific provisions in mind to propose to the Concom, Adamat said he wanted tertiary education to be a shared responsibility between the federal states and the federal government. Puno noted that this is possible, adding that the federal government may be put in charge, especially when setting standards and policies. Lawyer Tonisito M.C Umali, Department of Education (DepEd) undersecretary for legislative affairs, external partnerships and school sports, welcomed the inclusion of right to education under the Bill of Rights.

Tourism

China became the nation’s fastest-growing tourism market since Duterte took office in June 2016. The number of Chinese tourists to the Philippines doubled to almost 1 million in 2017, from 2015. South Korea remains the Philippines’s top tourist source.

Investment

Chinese foreign direct investments to the Philippines increased almost twentyfold in 2016, when Duterte became president, although these are still dwarfed by investments from other countries.

Loans, grants

Since the territorial dispute with China restarted in 2011, aid from China dw ind led, and almost dried up in the See “Duterte,” A2

“I will support that proposal to put that in the Bill of Rights [in the new charter], but it’s already there in the present Constitution, but if you will put that in the Bill of Rights, then that should be even better,” Umali told the BusinessMirror. However, Umali said he is hoping that the separate article on education, Article XIV in the 1987 Constitution, will remain as it is. “Please, I hope that they won’t remove the separate article on education. That shows the importance of education.” Asked if he wanted to propose any specific provisions related to right to education, Umali said, “What we have in the current Constitution is already more than enough.” He also admitted that not all challenges are solved by the current constitutional provisions. Once these rights are put under the Bill of Rights, Umali added, the challenge for the DepEd is how to implement the mandate given by the Constitution. On the enshrinement of right to housing under the Bill of Rights, the head of Housing and Urban Development Coordinating Council (HUDCC), Gen. Eduardo D. del Rosario (Ret.) said he is all for it. “It will make a difference [in our operation in HUDCC] because we will be given more budget to subsidize construction of more affordable housing,” del Rosario said, noting that the country currently lacks the budget for it. Housing needs will be easily fulfilled if there is a corresponding budget, added del Rosario, who also chairs Task Force Bangon Marawi. The public, he stressed, may gain protection from the state once the right to housing is enshrined, unless the house was illegally constructed or belonged to another person already. “There are no absolute rights. It must be with responsibility and accountability.” According to Ateneo Center for Economic Research and Development Director Alvin P. Ang, it is important that the state will be able to define these socioeconomic rights and be clear on what it wants to achieve. This, he noted, is because there might be some fiscal implications, since the state will now be paying to realize these rights. “It’s not necessarily bad; it’s not bad but the government should be prepared with its implication,” he said, noting that once it is put in place in the Constitution, there is no turning back. “If you put that in the Constitution, you won’t be able to remove it and you will need to fulfill it every time,” he added. “If it’s in the Constitution, then it means you really want to do it.”