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Thursday, April 19, 2018 Vol. 13 No. 187

Senators signal support for joint sea exploration S

By Butch Fernandez @butchfBM & Jovee Marie N. dela Cruz @joveemarie

enators on Wednesday signaled their support for a possible joint exploration with China in disputed areas bordering the West Philippine Sea as the government continues to search for alternatives to the Malampaya gas field in Palawan. In separate interviews, the senators also kept the door open to such joint explorations in resource-rich areas well within the Philippine

exclusive economic zone (EEZ). Senators issued their pronouncements even as concern was raised anew over reports that

ANGARA: “Agreements for joint exploration should abide by constitutional guidelines and are mutually beneficial and not one-sided.”

Chinese military transport planes were spotted landing on a Chinabuilt facility in the Philippines’s Panganiban Reef. Asked if senators would back joint exploration with China in the disputed areas, or even within the Philippines EEZ, Senate President Pro Tempore Ralph G. Recto

@lorenzmarasigan

fter signing an air pact with the Philippines, allowing direct flights between Manila and Male, the Maldivian government is batting for another round of air-services negotiations soon for the approval of the fifth freedom of the Air Rights between the two countries. Ibrahim Faizal, who chairs the Maldivian Civil Aviation Authority, told the B usiness M irror that, while his group is “satisfied” with the turnout of the air talks in Manila that concluded on Tuesday, the government of Maldives would like to request for another meeting with the Philippine air panel to negotiate for the approval of the fifth freedom rights. “We have not yet agreed on fifth freedom yet, but hopefully that will come too; and when it comes, Maldivian Airlines will also be interested in the fifth freedom flights too,” he said in a text message. The fifth freedom allows local carriers, like Philippine Airlines (PAL) and Cebu Pacific, to fly from Manila to Male and onward to any country. The said right is seen as a catalyst to improve connectivity and enhance the commercial viability of routes beyond Manila and Male. “We expect to hold them in Maldives next time around to finalize all the details. Basically, everything is agreed apart from the fifth freedom rights,” Faizal said. On Wednesday morning Civil Aeronautics Board Executive Director Carmelo L. Arcilla announced the results of the negotiations between the Philippines and

Maldives for flight coefficients. “The accord allows an initial entitlement of 1,200 seats that can be flown by each party’s designated airlines per week between Manila and Maldives,” he said. Flights originating from or destined to points outside Manila will be unlimited, in line with the Philippines’s pocket open skies policy, which promotes other international gateways away from the capital, he added. “We are very satisfied with the negotiations. It’s been a long time coming. We need this link,” Faizal said. Air negotiation panels of the two countries met in Manila on April 16 and 17 to draft the agreement after preliminary proposals were discussed in letter exchanges in the past few months. The Philippine air panel was led by the Department of Foreign Affairs, with representatives from the Civil Aeronautics Board, departments of Transportation, Tourism, Trade and Industry, and Labor and Employment as members. The Maldives delegation was composed of the chairman, the chief executive and senior officials of the Maldives Civil Aviation Authority. A tropical nation off the southern tip of the Indian subcontinent, the Maldives is composed of around 1,200 islands, atolls and reefs, and is known for its paradise-like resorts that attract tourists worldwide. Officials from both PAL and Cebu Pacific—two carriers that have the capacity to fly directly between Manila and Male—were unresponsive to queries. PAL Spokesman Cielo Villaluna earlier told the BusinessMirror that her group is reviewing the possibility of launching flights to the Maldives from Manila.

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Making the K-12 program work Rene E. Ofreneo

laborem exercens

here are criticisms that most of the senior high-school (SHS) students who are not proceeding to college are simply not job-ready. The K to 12 program of “work immersion” for two weeks cannot transform these students into skilled workers needed by industry. Accordingly, they should have at least 300 to 600 hours of “on-the-job training,” or OJT. This is the minimum number of OJT hours required by Germany under its rigorous skills program for secondary students, which combines theory with industry practicum. As it is, unemployment remains highest among the youth who have finished high school up to college. Given this reality on the supply side, industry labor recruiters in various regions are likely to give preference to young workers who have at least some years Continued on A12

Continued on A2

PHILIPPINES-MALDIVES 5TH FREEDOM SERVICES EYED By Lorenz S. Marasigan

2016 ejap journalism awards

Traders edging out NFA in race for local palay By Jasper Emmanuel Y. Arcalas @jearcalas

Martin Tlapa, deputy minister of Foreign Affairs for Non-European Countries and Economic and Development Cooperation (third from left); Martin Klepetko, director of the Asia-Pacific Department and Ministry of Foreign Affairs of the Czech Republic (second from right); and Benjamin Žiga, Economic and Commercial Section, Embassy of the Czech Republic in Manila (right), answer questions from reporters of the ALIW Media Group at the BusinessMirror Coffee Club Forum on Wednesday in Makati City. Others in the photo are (from left) BusinessMirror Envoys&Expats reporter Recto Mercene and BusinessMirror Envoys&Expats Editor Mike Policarpio. ALYSA SALEN

Czech railroad experts to solve MRT 3 woes By Recto Mercene

@rectomercene

he Czech Embassy in Manila is arranging for a group of railroad experts to come to the Philippines to offer solutions to the problems bedeviling the Manila Metro Rail Transit System Line 3 [MRT 3]. “Benjamin Žiga, [first secretary, Economic and Trade Section], is arranging a group of companies to present potential

solutions from the Czech side, and also we would like the chance to enjoy Filipino hospitalit y. That’s one important part we are discussing during our meeting [with Transportation Secretary Arthur P. Tugade],” said Deputy Minister Martin Tlapa, Minister of Foreign Affairs, during the BusinessMirror Coffee Club Forum on Wednesday. Tlapa’s reply was in answer to a question where, a few decades ago, the Czech Republic delivered

trams for MRT 3 and whether they are still interested to cooperate with Philippine authorities in this field. He allowed Žiga to explain the details of the arrangement. “You are completely right, we did deliver those trains from 1979 to 1999, they’re still operating, a proof that our technology is good and still working even though there are some maintenance issues that we are all aware of,” Žiga said. Continued on A12

he National Food Authority (NFA) could not buy more palay from farmers even if the summer harvest season has reached its peak as traders continue to aggressively compete with the food agency for locally produced rice. A government official told the BusinessMirror that the state-run grains agency can only buy palay from farmers in remote and nontraditional areas through its mobile procurement scheme. “The palay procurement is very minimal. [The NFA] is only able to buy in remote and nontraditional areas through mobile procurement and ugnayan, the official, who requested anonymity, told the BusinessMirror. “The main reason for the low procurement is the high ex-farm price of palay ranging from P20 to P24 per kilogram [kg] and the aggressive stance of private traders,” the source added. The source revealed that the NFA has received help from some local government units (LGUs), such as Isabela, to improve its palay procurement and salvage its nearly depleted rice stockpile. “There’s help coming from LGUs, like the provincial government of Isabela, which gives [farmers] a premium of additional P4.50 per kg on top of the government support price of P17 per kg,” the source said. “But the problem is that they only have limited funding.” Part of the NFA’s stockpile, which has fallen to 170,000 50-kg bags, or around 8,500 metric tons (MT) as of April 18, consists of unmilled rice bought from farmers. The NFA’s buffer stock is equivalent to less than a day, or just one-fourth of the country’s total daily requirement volume of about 32,000 MT or 640,000 bags. See “Traders,” A12

n japan 0.4867 n UK 74.4109 n HK 6.6336 n CHINA 8.2844 n singapore 39. 7102 n australia 40.4287 n EU 64.4183 n SAUDI arabia 13.8859

Source: BSP (18 April 2018 )

A2 Thursday, April 19, 2018

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Senators signal support for joint sea exploration Continued from A1

said he would, provided that such arrangement complies with the Philippine Constitution. “If they could figure out a way to make it constitutional,” Recto replied, citing, for instance, that “Malampaya is joint exploration or joint venture of some sort.” The Malampaya joint venture is led by global oil giant Shell and has accounted for a sizeable share of the country’s energy requirements. Sen. Gregorio B. Honasan, who chairs the Senate’s Defense and Security Committee, also affirmed support for similar economic arrangement “to avert war tensions or low-intensity conflict.” “Yes,” Honasan said in reply to the BusinessMirror’s query. “As long as our foreign economic security policies are clear, we are

able to use our bilateral multilateral engagements—Asean, MDT, VFA, Edca—as leverage, it does not violate core principles of our Constitution,” he added referring to the Association of Southeast Asian Nations, Mutual Defense Treaty, Visiting Forces Agreement and the Enhanced Defense Cooperation Agreement. Honasan added: “Also to trade space for time, to buy time for us to put our house in order fix our backyard, reduce the partisan political noise, unite and rally behind the Flag and attend to the real, more serious problems the nation is confronting.” Sen. Francis N. Pangilinan pointed out, however, this “can only be done via service contracts of the government with foreign private corporations, as allowed/ l imited by t he Const it ut ion,

which must still comply with procurement laws. At the same time, Pangilinan stressed that “proponents must be qualified, undergo transparent process, and decision must be based on clear criteria.” Sen. Juan Edgardo M. Angara affirmed inclination to support the option “so long as any such agreements for joint exploration will abide by constitutional guidelines and so long as these are mutually beneficial and not one-sided.” A ngara a lso ac k nowledged that “cooperation can be a favorable alternative to having these resources lie idle.”

Diplomatic protest

Rep. Gary Alejano of Magdalo and Rep. Carlos Isagani Zarate of Bayan Muna on Wednesday urged to file a diplomatic protest against China

following its “continued militarization” of the West Philippine Sea. Alejano and Zarate made separate statements after two Chinese military transport planes have been photographed on Panganiban Reef, marking the first reported presence of this type of aircraft in Philippine territory in the South China Sea (SCS) and raising the prospect that China will base warplanes there. “The Chinese did not reclaim Mischief Reef for nothing. The construction of a military grade airstrip there is not for display only,” Alejano said. “It is a matter of time before the Chinese deploy their fighter aircrafts in their reclaimed islands as part of their strategic objective of controlling SCS.” The lawmaker added the Philippines must “continuously and persistently” call out such move that

destabilizes the region. “We should not be deceived by China’s pronouncements that it will not militarize SCS. I am hoping that President Duterte will file a diplomatic protest this time around,” Alejano said. Zarate said the presence of Chinese military aircrafts in Panganiban Reef is a “clear violation” of the Permanent Court of Arbitration ruling. “This move of China is a clear violation of the ruling of the Permanent Court of Arbitration in the Hague and is a way of asserting its contempt of the court as well as its dominance in the area,” he added. “The Duterte administration should be taken to task for not doing anything on this blatant violation of our sovereignty. The Philippine government should not take this sitting down,” he said.

Panganiban Reef—internationally known as Mischief Reef —is located within the Philippines’s 370-kilometer EEZ in the South China Sea. The waters within this zone are known locally as West Philippine Sea. “Based on media reports, surveillance images taken on January 6, showed two Xian Y-7 military transport planes 20 meters to 50 meters apart on the ramp near Runway 21 on Panganiban, one of seven reefs in the Spratlys that China has transformed into artificial islands with military capabilities,” he said. “China is obviously flexing its military muscle and endangering the fragile peace in the West Philippine Sea. This is highly condemnable and the Philippines should protest this provocative Chinese action,” Zarate added.

Gloom descends on Boracay as closure date approaches Continued from A12

island, to invite them to come to the workshop. “They didn’t even tell the resort owners. Many had to find out about it through the grapevine,” participant one workshop said. “They held the meeting at Savoy, so it would be difficult for the rest of the stakeholders to get to,” she added. A number of t hem a lso

complained of being at the venue at 8 a.m., “as we were told to do so,” but the workshop actually started two hours later, as organizers waited for the government panelists. Participants noted earlier in the day that there were no high-ranking government officials who attended the workshop, until toward the event’s end, when Presidential Spokesman Harry L. Roque Jr.

put in an appearance with officials of the Department of Tourism and the Department of the Interior and Local Government. Meanwhile, Rowen Aguirre, executive assistant of the Malay local government, who was first among the government panelists to make his presentation of action plans, warned of the social impact of the six month closure, which would affect some 80,000

stakeholders on the island. In a “worst case scenario,” he said, the closure could lead to “mentalhealth problems, health diseases, tension at home, political issues, crime and violence, suicide cases, stigma, [lower] standard of living, loss of skills’ usage and school dropouts.” He noted that the local government unit (LGU) has already “ v a l i d at e d o ne d o c u m e nt e d

case of depression in one single mother with three kids, who lost her means of livelihood, and her house was demolished.” He underscored the need for the LGU to conduct regular “stress debriefing” of affected workers and residents on the island, to prevent possible emotional or mental-health breakdowns. As per the Malay LGU, 385 households have been told to vacate

their homes, which are located in no-build zones such as forestry land, wetlands, among others. When asked what he would do when Boracay closes in eight days, Bradder, an ambulant vendor of pearls from Mindanao said, “di ko pa alam. [I still don’t know what to do].” For many in Boracay’s informal sector like Bradder and Casidsid, one thing’s sure: Life as they know it, will never be the same again.

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Tourism resiliency bill up for House plenary approval

S the government prepares for the implementation of the six-month closure of Boracay next week, the House Committee on Tourism has endorsed for plenary approval a measure creating the Tourism Resiliency Certification Program (TRCP). House Bill 6093 seeks to prevent, mitigate and control possible damages arising from risks or threats to the tourism industry, such as violence, terrorism, and environmental degradation and climate change. The measure is expected to be discussed in plenary when session resumes on May 15. The measure refers the TRCP as a program that identifies risks to the country’s tourism industry; prescribes compliance measures; establishes an appropriate metric system to determine certain acceptable levels of compliance; and mandates the compliance of prescribed measures by all registered tourism enterprises. The bill said the creation of the program shall be undertaken by a technical working group, to be participated by representatives of stake-

holders and to be spearheaded by the Department of Tourism (DOT). The creation of the Philippine Tourism Risk Assessment Framework shall be conducted by a qualified international consulting agency, under the supervision of the DOT. Moreover, the measure declares the paramount importance of protecting the tourism industry, one of the major drivers of socioeconomic development in the Philippines, by supporting its fundamental performance indicators. It added these indicators include the number of foreign and local visitors, earnings from foreign expenditure, product development and capital expenditure, among others. The measure said that ensuring the security of foreign and local tourists is a cornerstone for the survival and growth of the tourism industry. The bill provides that the TRCP shall create a Philippine Tourism Risk Assessment Framework, which shall identify actual and potential risks to the tourism industry, such as terrorism, violence, natural calamities, extreme weather and other perceived threats. Jovee Marie N. dela Cruz

Senate to probe ₧59.8-million PNP-SAF allowance anomaly By Butch Fernandez @butchfBM

enate probers are poised to open an inquiry into the controversy surrounding the withheld release of P59.8-million subsistence allowance and hazard pay intended for members of the Philippine National Police-Special Action Force (PNP-SAF). Sen. Panfilo M. Lacson Sr., a former PNP chief, on Wednesday pressed for an investigation, voicing concern that delaying the daily subsistence allowance and explosive ordnance disposal hazardous pay for the PNP-SAF, “if true,” could trigger “demoralization” among members of the elite force that the senator noted are “the front liners in fighting terrorism and criminality.” Lacson lamented, “We cannot allow, yet again, another injustice to be committed against our heroes in uniform who are in the forefront of our fight against the ills of terrorism and criminality, lest we risk demoralization within their ranks. Thus the need to probe into the said allegations.” In filing Senate Resolution 712 to pave the way for an inquiry, Lacson affirmed the need to revisit the implementation of existing laws to “make sure police officers receive the benefits due them and to punish the erring parties concerned.” At the resumption of Senate sessions on May 15, Resolution 712 is expected to be formally referred to the Senate Committee on Public Order and Dangerous Drugs, chaired by Lacson, which is set to promptly conduct an inquiry in aid of legislation “on the alleged illegal withholding of the release of the allowances.”

In a news statement, Lacson said the upcoming hearing “seeks to propose remedial legislation to correct the same and put a stop to this unlawful practice to the prejudice of the intended beneficiaries.” The senator warned that “unlawful withholding of PNP-SAF funds, if true, constitutes a criminal or unlawful act, adding that it “runs counter to the evident policy of President Duterte to increase the pay of our military and uniformed personnel in order to repay them for their sacrifices.” Lacson added that in a move to strengthen the SAF, some 4,000 members who engage in life-threatening police operations are entitled to a daily additional subsistence allowance (ASA) of P30 a day (P900 a month), and allocations for Explosive Ordnance Disposal Hazardous Pay. This is usually given by the unit’s finance sergeant every quarter. He, however, cited records showing the 4,000 SAF members only got their share of ASA for January 2016 and January to July 2017. The senator admitted members of the SAF approached him to air their grievances on the matter, even furnishing the senator a copy of their complaint affidavit and annexes filed before the Office of the Ombudsman. “When confronted with the issue of the non-release of ASA, then-SAF head Director Benjamin Lusad and SAF budget officer Senior Supt. Andre Dizon admitted they got the unreleased ASA and admitted using the amounts for operational expenses, fellowship and training—but without showing proof of the liquidation,” the senator said.

Editor: Vittorio V. Vitug • Thursday, April 19, 2018 A3

LTFRB told to end ‘virtual monopoly’ in TNC market after Uber withdrawal

By Jovee Marie N. dela Cruz @joveemarie & Lorenz S. Marasigan @lorenzmarasigan

awmakers on Wednesday urged the Land Transportation Franchising and Regulatory Board (LTFRB) to expedite the approval and entry of other transportation network companies (TNCs) in the Philippine market. House Committee on Metro Manila Development Chairman Winston Castelo of the Second District of Quezon City and House Committee on Transportation Member Luis Raymund F. Villafuerte Jr. of the Second District of Camarines Sur said a “virtual monopoly situation” in the transportation network vehicle service sector now exists with the official withdrawal of the Uber services after selling out to competitor Grab. “ T he L and Transpor tat ion Franchising and Regulatory Board can remedy [this monopoly] by allowing more transportation network company to offer services,” Castelo stated.

One out of five

The LTFRB, for its part, said t he agenc y intended to sig n the accreditation papers of five TNCs on Wednesday. As of writing time, however, the

LTFRB only signed the accreditation of Hype, LTFRB Board Member Aileen B. Lizada said in a text message. Other TNCs that fled for accreditation are Hirna, Go Lag, Micab and Ipara. Once they receive they their accreditation documents, these new TNCs could start operating in the Philippines. “Once we accredit TNCs, what the TNVS should do is to go to the TNCs to accredit under their systems. Once they are accredited they will get their certificates of accreditation for their hearing for their CPCs,” Lizada said, referring to certificates of public convenience. For his part, Villafuerte said

the government should fast-track the processing of applications of at least four TNCs that plan to rival the ride-hailing services of Grab Philippines to encourage competition and prevent a monopolistic pricing scheme in this sector. He added four local firms have applied for TNC licenses, namely Pira, Lag Go, Owto and Hype. The lawmaker said the buyout by Grab of its biggest rival Uber in the business has led to a monopoly in the ride-hailing business in the country. Grab announced last month that it had acquired Uber’s operations in the Philippines and the rest of Southeast Asia. Under the shareswap agreement, Uber would be getting a 27.5-percent stake in Grab.

Incentives

Moreover, Castelo said it is incumbent upon the LTFRB to protect the interest of commuters, which he suggests would do well to expedite the entry of competitors to Grab. Castelo earlier urged the government, through the Board of Investments, to provide incentives to small local companies that will be formed to challenge the dominance of Grab.

The entry of more local players in the TNC business is needed to dissipate Grab’s domination of the industry.”—Castelo

Sereno unfazed by ratings drop, spokesman says By Joel R. San Juan @jrsanjuan1573

Crime check

An officer of the Quezon City Police District (QCPD) writes down the personal information of a motorcycle rider along Kalayaan Avenue in Quezon City, as QCPD personnel conduct “Oplan Sita” on Wednesday. Oplan Sita is a police campaign against criminals riding motorcycles, which President Duterte had ordered to be strictly enforced. PNA/Joey Razon

Poll preps at the homestretch as 305,082 file COC for May 14 BSKE—Comelec By Samuel P. Medenilla @sam_medenilla

reparations for the upcoming elections is now nearing its final phase as the Commission on Elections (Comelec) starts next week the purging of the list of candidates for the barangay and Sangguniang Kabataan elections (BSKE) with the end of filing of certificate of candidacy (COC) on Friday. Spokesman James Jimenez also said the Comelec has no plans to extend the COC filing period. “We will have no extension. As we said, the last day of filing of COCs will be on April 20 from 8 a.m. to 5 p.m.,” Jimenez said at the Kapihan sa Manila Bay media forum.

Based from latest available data from the Comelec, a total of 305,082 would-be candidates have already filed their COCs nationwide for the May 14 BSKE as of April 17. Of this figure, 225,617 COCs were filed for the barangay elections, while the remaining 79,465 were for the SK polls.

Final list

Jimenez said they expect these numbers would continue to surge during the two remaining days for the filing of COCs. After the filing period, he said, the COCs will be brought to the Comelec main office in Intramuros, Manila, for evaluation. “This would have to be completed within two weeks so we could

“The entry of more local players in the TNC business is needed to dissipate Grab’s domination of the industry,” Castelo said. He added Grab’s monopoly is starting to manifest in the list of complaints he received from his constituents on sudden spikes in the rates it offered. “Incentives similar to those given to pioneering businesses such as income-tax breaks should be provided to new TNCs, primarily local firms, to encourage competition that will redound to the benefit of the public,” Castelo said. Castelo, meanwhile, acknowledged Grab’s explanation that the rates were still within the bounds approved by the government but it is now far higher than what was being offered when a healthy competition existed in the ridehailing vehicle business. Earlier, Party-list Rep. Jericho B. Nograles of Puwersa ng Bayaning Atleta has revealed that Grab has been “illegally charging” its customers P2 per minute of travel time. Nograles said the P2 per minute additional charge is on top of its flag-down rate of P40 and P10 to P14 charge per kilometer. He added Grab should refund some P1.8 billion for overcharging in the past five months alone. Party-list Rep. Ciriaco S. Calalang of Kabayan, likewise, urged the LTFRB to probe the reported higher fares of Grab following the shut down of Uber.

come out with the official list of candidates, which will serve as the basis on who will run,” Jimenez said. “We will assess if they have missing requirements or they have committed any errors in their COCs,” he added.

Enough manpower

The poll official said they were also finally able to get the commitment from enough public-school teachers, who will serve as members of the Board of Electoral Tellers (BET) during the BSKE. The Comelec will assign three BET members for each of the 177,565 polling precincts nationwide. “If I am not mistaken, we have already completed the complement of teachers, but it is a different matter

to see if all them will show up during the elections,” Jimenez said. He, however, noted they already have standby personnel for such a scenario. As for the compensation of the volunteer teachers, Jimenez said they will soon finalize its amount. “We will come out with the announcement regarding compensation next week once we finalize our MOA [memorandum of agreement] with the DepEd [Department of Education],” Jimenez said. “ The compensation will be based on the days of service that they will render,” he added.

Additional pay

Former Comelec Commissioner Gregorio Lardizabal urged the

poll body to provide additional compensation to teachers, who will serve in the BSKE since it will held manually. “Compared to the automated elections where the teachers just process the voters, in the manual elections, they will not only process the voting but also do the counting of the votes,” Lardizabal said. “I think their per diem pay should be higher because there is more work,” he added.

Soce reminder

Jimenez also reminded all the BSKE candidates to submit their statements of election contributions and expenditures (Soce) on June 13, 2018, or risk facing perpetual disqualification.

HE camp of Chief Justice Maria Lourdes A. Sereno on Wednesday said they were not surprised with the plunge in the satisfaction ratings of the embattled chief magistrate. Lawyer Josa Deinla, a spokesman for Sereno, said the 13-point dip in her net public satisfaction ratings “is not surprising when there is a wellorchestrated and well-funded campaign against Chief Justice Sereno.” “What is right is not always what’s popular,” she added. Deinla expressed optimism that Sereno’s ratings would bounce back once she is given the opportunity to defend herself before the Senate, sitting as impeachment tribunal. “The Chief Justice is optimistic that if she will be given her day in court—the Senate impeachment tribunal—she can defend herself and prove that all the allegations against her are baseless and wrong. The Filipino people, too, deserve to know the truth,” Sereno’s spokesman said. The embabbled Chief Justice is looking to hurdle two major bids to oust her from her post —first the quo warranto petition filed before the Supreme Court and second, the impeachment proceedings in the House of Representatives and the Senate. Earlier, President Duterte publicly threw his support on the bid to remove Sereno from her post after she accused him of having had a hand in the filing of the quo warranto petition against her. The survey showed Sereno with a net rating swinging from +6 in December 2017 to -7 in March 2018. Sereno’s net satisfaction rating, the same survey added, plunged due to declinesof27pointsinMindanao(-22from +5), 13 points in the Visayas (-1 from +12), 11 points in Luzon (-2 from +9) and 3 points in Metro Manila (-10 from -7).

Economy

A4 Thursday, April 19, 2018 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

DOE’s Cusi says he prefers Swiss challenge option for Meralco PSAs

By Lenie Lectura

@llectura

NERGY Secretary Alfonso G. Cusi on Wednesday said he prefers the power-generation arm of Manila Electric Co. (Meralco) to undergo a Swiss challenge scheme for the power-supply agreement (PSA) applications yet to be acted upon by regulators.

“I’ll not speak on the legal issues. My personal view is that they subject it to Swiss challenge. I am not against Meralco…. I am looking for affordability. I am looking at the tariff. I want assurance of supply. But, at the same time, I am going to make sure that it is affordable and fair to everybody,” Cusi said. The energy secretary added he discussed this with Meralco PowerGen Corp. (MGen) President Rogelio “Babes” Singson. “Babes told me that the PSAs are already pending with the ERC [Energy Regulatory Commission],” the DOE chief said when asked for Meralco’s reply. Meralco’s PSAs applications cover a total of 3,551 megawatts with vari-

ous generation companies (gencos). These are with Redondo Peninsula Energy Inc., St. Raphael Power Generation Corp., Atimonan One Energy Inc., Central Luzon Premiere Power Corp. and Mariveles Power Generation Corp. of the San Miguel Group and Global Luzon Energy Development Corp. of Global Business Power Corp. Meralco President Oscar S. Reyes said these PSAs were entered into as early as April 2016. These underwent all the necessary due process, including documentation and public hearings. However, the ERC allegedly favored Meralco by excluding the power-distributor from the com-

petitive selection process (CSP), which requires distribution utilities and power-generation companies to subject their PSAs to price challenges. This did not sit well with consumer groups and other sectors. Lawmakers conducted an inquiry into the alleged midnight deals for Meralco. The agency denied this. The ERC extended the validity of the CSP policy mainly because it wanted to address the valid concerns raised by the distribution untilies and gencos. “The extension of the CSP implementation was not intended to benefit any electric power industry participant, but to give time to those who have already completed their PSAs but failed to submit the same to the ERC prior to the effectivity of the CSP,” the ERC said. The delay in the approval of these applications and the consequent delay in the financial close and, subsequently, the commercial operations date of the power projects will adversely affect the utility firm’s ability to meet demand growth in its franchise and overall energy security in the Philippines. “I am not going to demand something that is not legal,” Cusi added when asked if shifting the procurement process to Swiss chal-

lenge from CSP is legal. “It did not go through CSP, that’s the issue. So have it undergo via Swiss challenge,” Cusi said. Reyes said ERC approval is urgently needed, saying the delay has caused significant increases in the engineering, procurement and construction (EPC) costs and financing costs of the new power plants. The Meralco official said that if the total costs of the projects were to balloon, then the financing cost would increase, as well. “It would be most unfair to Meralco customers,” Reyes said. “Costs have been increasing,” he added. “We negotiated very competitive EPC costs. We negotiated competitive costs and also financing terms. I don’t think we can repeat it.” Reyes could not stress enough the impor tance of the PSA s, which, he said, are meant to meet additional electricity demand. “We don’t want to create any sort of fears or concerns, but I think you just have to look at reality if you keep on delaying projects. Demand is not stopping,” the Meralco official said. For now, all Meralco could do is to “continue to make our case and appeal for timely action and decision.” “Our option is to continue to hope,” Reyes said.

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Cooler ride for LRT 2 commuters with ₧350-M air-con replacement deal By Lorenz S. Marasigan @lorenzmarasigan

he government has tapped MR ail Inc. and partner Multiscan Corp. for the P350 -mi l lion replacement of the air-conditioning units of 10 train sets of the Light Rail Transit (LRT) Line 2. The systematic replacement deal is part of the multiyear rehabilitation and modernization project aimed at improving the reliability, capacity and the overall efficiency of the system, LRT Authority (LRTA) Reynaldo Berroya said. “We are aware of the surge of complaints concerning the poor air-conditioning system of trains, which is why we ensured that exigent attention is given to resolve the problem,” he said. Under the said project, the joint venture will replace a total of 80 air-conditioning units for 10 running trains. Each four-car passenger train has eight units and each has a 20°C to 24°C cooling capacity to maintain. It has the capacity to adjust automatically depending on the number of passengers. However, at present, the cooling capacity of the trains has dropped to 50 percent of its normal cooling capacity due to the obsolescence of the board module, noting that the trains are

already 15 years old. Due to the current condition of the existing train air-conditioning system, it is more efficient and beneficial to replace the whole system altogether. “MRail, being a rail maintenance and technology company that has achieved a Quality Certification from the International Organization for Standardization, we br ing our ex per tise and capability in executing the Systemat ic ACU repl acement for the LRT 2 Rolling Stock,” MRail President Ferdinand G. Inacay said. Using latest technology and original equipment manufactured parts, the new air-conditioning system will seamlessly interface with the train monitoring system. It shall also be environment-friendly, energyefficient and compliant with the Clean Air Act. The joint venture will have a full year to finish the project, after the notice to proceed has been issued by the transportation agency. For the meantime, the LRTA Engineering and Maintenance Team is doing corrective measures like cleaning the trains’ air-conditioning motors “more frequently to make train temperature more bearable while awaiting the systematic replacement to take place.”

Lim assumes ACB post, vows push for biodiversity-friendly biz in Asean By Jonathan L. Mayuga @jonlmayuga

ew ly insta l led A sea n Centre for Biodiversity (ACB) Executive Director Theresa Mundita S. Lim on Tuesday vowed to intensify the promotion of biodiversity-friendly business enterprises in Southeast Asia. Established in 2005, ACB is the Association of Southeast Asian Nations’s response to the challenge of biodiversity loss. It is an intergovernmental organization that facilitates cooperation and coordination among 10 Asean member-states and with regional and international organizations on the conservation and sustainable use of biological diversity, and the fair and equitable sharing of benefits arising from the use of such natural resources. In her speech during the turnover ceremony at the ACB headquarters in Los Baños, Laguna, Lim said the business sector relies on biodiversity for their raw materials and ecosystem services. Lim addede as part of her 10-point thrusts as ACB’s new executive director, she will endeavor in mainstreaming biodiversity in Asean and promote biodiversity-friendly business enterprises through policy advocacy among the 10 Asean member-states, including the Philippines. The other members-states of the Asean are Brunei Darussalam, Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, Singapore, Thailand and Vietnam. Lim lamented that irresponsible business practices contribute to biodiversity loss and bad investments. “The business community holds so much human and financial resources, more than the combined resources of governments. As business is a problem and a solution, they should be part of our mainstreaming effort, therefore, engagement with them is inevitable,” Lim said. According to Lim, biodiversity is a crosscutting concern and it cannot be separated from the development process. “As the IUCN [International Convention for the Conservation

of Nature] espouses, biodiversity conservation is a precondition for achieving sustainable development. As such, it needs to be integrated into all sectors and across sectors: biodiversity needs to be mainstreamed,” Lim said. “We will focus on mainstreaming biodiversity by further strengthening our partnership with the Asean Working Group on Nature Conservation and Biodiversity, and working with the Asean Working Group on Coastal and Marine Environment, Asean Working Group on Sustainable Cities, and other relevant Asean Working Groups. We will also work with the development sector and link with like-minded development organizations and individuals in our region so that we can leverage resources and avoid duplication of efforts,” she added. Lim, a retired former director of the Biodiversity Management Bureau (BMB) of the Department of Environment and Natural Resources (DENR) added: “The ACB will endeavor to create more meaningful private-sector partnerships by engaging the business community, and demonstrating that biodiversity is good for business.” The lady official bested other applicants for the position left vacant by outgoing ACB Executive Director Roberto Oliva who held the position since 2003. The DENR-BMB’s Assistant Director Crisanta Marlene Rodriguez, a forester, is officially taking over as its director. Lim was director of the DENRBMB for more than 14 years. She joined the DENR shortly after graduating with a degree in Doctor of Veterinary Medicine from the University of the Philippines-Diliman in 1988, and was assigned at the DENR’s Pawikan Conservation Project based in the Turtle Islands in Tawi-Tawi during her first two years before her transfer as veterinarian of the Wildlife Rescue Center of the BMB, then known as the Protected Area Wildlife Bureau. Subsequently she became the WRC’s chief and was named assistant director and eventually, the BMB chief in 2003.

Cimatu hails outgoing BMB chief

During a simple turnover ceremony at the DENR-BMB office at the Ninoy Aquino Parks and Wildlife Rescue Center in Quezon City, Environment Secretary Roy A. Cimatu hailed Lim’s accomplishment as DENR-BMB chief. Lim was instrumental in increasing the budgetary allocation from the national government for biodiversity conservation to as much as 70 percent in the last six years, Cimatu said. “She spearheaded the development of policy frameworks on key conservation measures such as biodiversity-friendly business enterprises, the National Ecotourism Strategy, the Philippine Biodiversity Strategy and Action Plan, and the expanded Nipas [National Integrated Protected Areas System] bill. She established close linkages with academe, such as the University of the Philippines Institute of Biology, the UP-Marine Science Institute, and the Siliman University, to address biodiversity research needs. She maintained excellent working relationships with other government agencies, NGOs, the private sector, the press and communities, in the implementation of agency programs and projects,” Cimatu said.

New BMB assured of Cimatu’s support Cimatu, likewise, assured the incoming director of the BMB, who rose through the ranks since joining the DENR in Region 5 in 2005 as Forester 1 of his support. “Krisma [Rodriguez] is tireless as a public servant. I personally witnessed this during the monitoring of Mayon Volcano’s unrest at the start of this year. The DENR Region 5’s response under her leadership at a time of crisis was prompt and well-coordinated. I witnessed how she led her team competently, and how she managed collaborative response with other agencies. And if I may add, she is also gifted with a golden voice, an attribute that can be very important in building fellowship and partnerships,” Cimatu said. According to Cimatu, biodiversity as a concept can be difficult to comprehend.

Agriculture/Commodities BusinessMirror

www.businessmirror.com.ph

Editor: Jennifer A. Ng • Thursday, April 19, 2018 A5

DTI vows to make PHL coffee sector competitive

By Elijah Felice E. Rosales @alyasjah

he Department of Trade and Industry (DTI) vowed to prioritize coffee producers in the government’s assistance for small businesses to accelerate their production in the next four years.

Trade Secretary Ramon M. Lopez said the government remains firm on its commitment to make the country on a par with the world’s top coffee producers, such as Brazil, Vietnam, Columbia, Indonesia and Honduras. He added the DTI and Department of Agriculture are “working closely” to achieve the objectives of the Philippine Coffee Industry Roadmap 20172022 a year after it was signed by President Duterte. “We have to have a patriotic drive to encourage demand for Philippine coffee. We are encouraging local producers to expand coffee production to create the demand,” Lopez said. He added local growers should take advantage of the Filipinos’ coffee consumption, which is one of the highest in the world. Proof to this, the Philippines is the top importer of soluble coffee and fourthhighest importer in the world.

Under the coffee road map, the country is aiming to create a coffee industry that is “cost-competitive,” aligned with global quality standards and reliable and environment-friendly. The framework is also intended to provide sustainable benefits to farmers, processors, traders and exporters in a bid to reach food security and poverty alleviation. The coffee road map is also aimed at raising annual coffee production to 214,626 metric tons by 2022 from the estimated 37,000 MT each year. If accomplished, this will increase the country’s self-sufficiency level to 161 percent from 41.60 percent. To achieve this, Lopez said the DTI will be “unwavering” in assisting local growers with their production and finding markets. “Through the DTI’s 7Ms [Mindset change, Mastery, Mentoring, Money, Machine, Market access

Taylor Weidman/Bloomberg

and Models of business], we will cont i nue to prov ide en abl i ng mechanisms to empower coffee farmers and help in addressing the challenges in the industry,” he explained. Lopez assured there are enough consumers for coffee growers to service, with the country’s current demand for coffee at 90 percent and imports of the staple amounting to P12 billion. He added the demand is also increasing by the day with broadening consumption among younger people. Due to the Philippines’s favorable location and tropical climate, it can produce four varieties of coffee, namely, robusta, arabica, excelsa and liberica. At present,

Govt interventions mitigated ill effects of climate change on agriculture, poverty–study By Cai U. Ordinario @cuo_bm

he national government’s interventions prevented extreme weather phenomena, such as El Niño and La Niña, from contributing significantly to food inflation and poverty increase, according to a study from the Philippine Center for Economic Development. In a discussion paper, titled “Establishing the Link between Poverty and Changes in Climatic Conditions in the Philippines,” University of the Philippines School of Economics Associate Professor Agustin L. Arcenas said changes in climate, particularly during El Niño and La Niña, even led to a decline in prices and poverty level. “Closer examination, however, indicates that the expected results would have happened if not for the implementation of the disaster and climate-change adaptation program of the country. It now appears that the government’s initiatives to make the agricultural sector disaster and climate-change resilient may be functioning,” Arcenas said. In 2015 data showed that the bottom 30 percent of the population and upper 70 percent of the population spent 60 percent and 39 percent of their income, respectively, on food. On average, Filipino households set aside 42 percent of their budget for food expenditures. Arcenas’s results showed poverty level is significantly affected by the agricultural wage rate, the production of irrigated palay, total irrigated area in the agricultural sector and the occurrence of the extreme weather phemenona, El Niño and La Niña. El Niño and La Niña, which are represented by changes in average temperature and precipitation, do not significantly affect food prices and, ultimately, poverty levels. Government interventions, such as rice and corn programs, and financial assistance to farmers during times of natural calamities, allowed the creation of ample food supply, keeping prices low and high poverty at bay. “This statistical insignificance of average temperature and precipitation can be attributed to the successful adaptation of farmers to the changes in

these variables,” Arcenas said. “The surprising result is the significant but negative relationship between El Niño and La Niña, and food prices, which indicates that the occurrence of either of these weather shocks could lessen poverty in the Philippines,” he added. However, Arcenas said that while climate-proofing the agriculture sector can be considered an anti-poverty program, the government should not depend on it alone. He said poverty is “multidimensional” and as such, requires various solutions. Arcenas said there is a need to address the needs of poor households that are not linked to agriculture, particularly those in urban areas during climate change-related shocks in the country. Arcenas said there is also a need to improve programs and interventions for the agricultural poor, particularly nonterrestrial agricultural poor, indigenous people and other nonfarm workers living in the rural sector. “One may argue that with the limited government resources, the course of action should be to secure the food supply first. There is no argument that food security is, indeed, important, especially during these times where climate-change hazards are imminent, but it would be worthwhile to keep in mind that total resilience to disasters and climate-change hazards must eventually involve the long-term protection of all sectors,” Arcenas said. The National Economic and Development Authority (Neda) said in 2015 that interventions to mitigate the impact of El Niño on 66 provinces will require P19.2 billion. The Neda added El Niño affected various provinces, including Quirino, Aurora, Quezon, Bohol, Siquijor, Camiguin and Misamis Oriental To address the needs of these provinces, the Neda said the government implemented cash-for-work programs worth P2.9 billion in 2015, and P7.3 billion in the first semester of 2016. The Neda said the Department of Social Welfare and Development also introduced food stamps to farmers who were affected by the drought. This intervention, the agency added, received a budget of P1.3 billion for 2015, and P1.9 billion for the first semester of 2016.

Soccsksargen produces the highest volume of coffee at 25,100 MT, followed by Davao (11,429 MT), Autonomous Region in Muslim Mindanao (10,341 MT), Northern Mindanao (5,604 MT) and Western Visayas (4,356 MT). Coffee growers, along with trade and agriculture officials, recently discussed the future of the coffee road map at the Third Philippine Coffee Conference. The discussion shed light on the strategies to achieve the goals of the coffee road map, trends in coffee-brewing methods, quality coffee farming of Arabica and fine Robusta, retailing a coffee business, financing for coffee business and coffee-business models.

TheBroa

Business

A6 Thursday, April 19, 2018

Geopolitics and a Princess

By Roger Pe

HE was the first princess I met and I was so dumbstruck I only noticed her smile, which was as radiant as the sun.

JACEL poses with supporters.

Princess Jacel Kiram was wearing a hijab, all smiles and charming when we shook hands. What struck me most was she spoke English with crystal-clear clarity. It hid any accent associated with those from Manila. Jacel exuded less the trappings of royalty but one can sense her regal bearing. Her intelligence and nobility was evident throughout the conversation. And unlike a castle, she resides in Maharlika Village, Taguig City, a village created by the government as a subdivision for Muslim Filipinos in 1974. Her grandmother from her mother’s side was from Pangasinan, northern Luzon, her grandfather from Sorsogon, far south. Her father Sultan Jamalul Kiram III met her Christian mother when the latter was reviewing to secure her license as a certified public accountant. Jacel’s name is a marriage of Muslim and Christian words: Jamalul and Celia. Being a product of a religious inter marr iage, her clan celebrates Muslim and Christians occasions, like Hariraya and Christmas. In an age when Christians and Muslims stand apart from each other on opposite sides of a very huge divide, hers is a shining example of harmonious coexistence. Beyond the differences, Jacel sees a common ground when it comes to moral values and principles: charity, devotion and faith, just as how other major world religions preach the same.

Coexistence

JACEL graduated from the De La Salle University College of Saint Benilde, also run by the Institute of the Brothers of the Christian Sc hool s, where she f i n i shed bachelor of arts with a degree in Inter-Disciplinary Studies in 2002. Her “The Sulu Sultanate’s Genealogy and its Relation to the Philippines’ Claim to Sabah” was declared Best Thesis. The daughter of the late 33rd Sulu Sultan Jamalul Kiram III has become an icon of peace, inter-faith, women empowerment and social upliftment, livelihood and development of Muslims in the Philippines, especially in Mindanao.

“I wish people would get rid of their misconceptions about Muslims,” she says. “We can coexist.” Jacel laments about many incidents in the city that are still causing her deep pain to the point of being callous. She observes that cab drivers, for example, speed away and do not take her and her fellow Muslims as passengers if they find out they are going to Maharlika Village. Her hu sba nd , Moh Yu sop Hasan, a lieutenant colonel in the Philippine Army, echoes her sentiments. “Musl im Fi l ipinos had been branded as bandidos [ band its], pirates a nd ot her u npa l at able names for centuries. We should cor rect t he ma ny soc i a l injus t ices t hat have been heaped on t he m ,” H a s a n s ay s. “ It ’s about t ime t hat people erase t he long t ime propaga nd a t hat t hey a re ‘ter ror ists.’”

Labeled

JACEL, herself, was branded a terrorist by the Malaysian government when the Lahad Datu incident drew headlines. “I am not a terrorist. I am just fighting for what is legally, historically and rightfully ours. This fight is not just my fight, but Filipinos’ fight, as well,” she exclaims. “If am being labelled as a terrorist fighting for what is ours as Filipinos, let them. Let history be the judge.” Jacel expressed sadness about younger generations of Filipinos who are afflicted with historical amnesia and have forgotten the glorious past of the sultanate. She maintains that the 2013 events in Lahad Datu were simply “an assertion of our rights.” “The word ‘terrorist’ is the weapon of the weak against the strong, a defense mechanism of people who make their own rules,” Hasan says. “The real terrorists are abusers.” He e x pl a ins t hat “Musl im people are kind.” “That’s the difference. They only lose their patience against abuses. Lands were taken away from them. They could not fish from their own seas and do not benefit from their own natural resources,” he says. “There

is w idespread inequalit y and wealth belongs only to a few.”

Kiram

UNTIL March this year, I have never been to Sulu, particularly Tawi-Tawi, a remote group of islands suffering from unfair travel advisories most of the time. Friends had always told me, Sulu’s history and its sultanate (Basilan, Sulu and Tawi-Tawi) would inevitably surface in any conversation, and the word “Kiram” would always be associated with it. True enough, the name that always fascinated me, was casually mentioned in the van that was to take us to our hotel. That heightened my curiosity. As soon as we arrived at Rachel’s Place, a hotel I never knew existed in the seemingly lonely planet, I was ready to ask more questions. But the dissonant voices in the lobby reduced my queries to a mere thought balloon, lost in the din of voices getting louder and louder as we headed back to our rooms. For a moment, I had forgotten about Kiram. However, my interest of wanting to meet any of Kiram’s relatives was heightened when a cameraman brought by the Department of Tourism to the trip told me he had personally met Kiram’s daughter, Princess Jacel Kiram.

For days, I nagged him to death about Jacel. I finally got an answer after a week. At three o’clock in the afternoon of March 3, I finally came face-toface with the princess.

Leadership

JACEL has attended many national and international events as a speaker. Among them as head of a Philippine delegation and guest of honor to the 19th World Festival of Youth and Students in the World Federation of Democratic Youth held in Sochi, Russia. She also went to China to ce lebrate t he 6 0 0 t h Yea r of Sulu-China Friendship, coinciding with the book launching of Friendship Without Borders, in Guangxi. Jacel also participated in a United Nations-sponsored conference on Drug Control Program held at the United Nations Headquarters in Vienna, Austria. She was also the chairman of People’s Coalition for Peace. In the bigger scheme of things, Jacel says: “We should always go back to history to get a better perspective.” She exhales, sounding like exhausted because “much of our history is being distorted.” “Sana hindi na lang ako [I wish it should ’ve not been me] so people won’t think of me as biased,” she says. But Jacel adds

she is optimistic histor y will be corrected with regards to the Philippines’s territorial claim to Sabah.

Sabah

W HEN I w a s i n g rade sc hool , I remember how t he Ph i l ip pi nes’s c l a i m to Saba h w a s a smolder i ng i ssue. Nor t h Bor neo wa s its old name, under the sultanate and the Federation of Malaysia was still not born. It always exploded on the pages of newspapers my mother partly distributed in my hometown. Sabah eventually became part of Malaysia. The newly formed Federation of Malaysia had annexed it in 1963 because of British connections, complex things and through a referendum some people said it stage-managed. Sources said the “referendum” did not involve the entire population of North Borneo at that time, but only representative consultations. The UN mission report also noted that, “there was no reference to a referendum or plebiscite in the request.” Fast forward to 2013, Sultan Jamalul Kiram III, a descendant of the Sultan of Sulu from 1568, ordered his family and followers to keep the sultanate’s historic territorial claims to Sabah. His younger

brother Esmail, and about 200 followers, went to Sabah’s coastal village of Lahad Datu. The Philippines’s diplomatic relations with Malaysia teetered on the fringes of conflict. The issue had remained in the back burner ever since the three-nation “Maphilindo” (Malaysia, Philippines, Indonesia) group vanished into thin air. Malaysia made strong statements: “It does not recognize and will not entertain any claim, nor bring the matter to the International Court of Justice even if the Philippines would.” While historically, the Philippines has the right to reclaim Sabah, some people doubt if the country can recover it now. For Jacel, however, “the best way to reclaim Sabah is do it now.” “The government must have the will to do it. Not giving up on our proprietary rights and fighting for what is due us are the things to do,” she says. “As far as Malaysia is concerned, skirting the issue and not wanting to talk about it means only one thing: It does not own Sabah.”

Malaysians

IN “Another Brick In The Wall,” a Malaysian political blog, the unnamed author unleashes fire and brimstone.

aderLook

sMirror

www.businessmirror.com.ph | Thursday, April 19, 2018

ss: Conversation on Sabah

JACEL gives bag of goodies to children.

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“The word ‘permanent lease’ means ‘it cannot be reclaimed’ and the words in the grant did not say lease but cede or give away for a certain consideration, and that the grant for a permanent lease meant giving away Sabah,” the entry reads. In his article in Free Malaysia Today, Raymond Tombung wrote that “the Sabah claim will continue to be raised by the Philippines and Sulu as it is powerful and emotive international issue, which many leaders from Manila will find convenient to bleed for political mileage.” Tombung added that “the many ‘sultans’ in Sulu will continue to cast their hungry eyes at Sabah, considered to be ‘the last gold coin’ and aspire, albeit hopelessly, to try and achieve the impossible.”

Questions

IN a series of articles, Joseph G. Lariosa, a Filipino-American correspondent of Journal GlobaLinks (JGL), posed several questions. “Did the Malaysian government ever allow the heirs of the Sultanate of Sulu to talk to their tenants in Sabah to find out their sentiments if they were really against the Sultanate by way of a referendum for the pur pose?,” Lariosa asked. “Did the Malaysian government

allow the Sultanate air time in mass media in Sabah to explain to their tenants that because they are residing on a piece of land owned by a Filipino Sultanate of Sulu, they are supposed to pay rental directly to their landlord—the heirs to the Sultanate of Sulu—not to a third party or middleman, such as the Malaysian government? ” Lariosa then drops a bomb: “If I were the heirs to the Sultanate of Sulu, while they are waiting for the ruling of the ICJ, I am not going to encash the 6,300 Malaysian ringgits to protest and humiliate the Malaysian government just as Fidel Castro refused and refuses to encash the $2,000 annual rental payment of the US to use the Guantanamo US Base in order to humiliate the US into giving up the perpetual rental under the Platt Amendment.” Lariosa further compared the lease agreement the Americans secured from the Philippines for the Clark Air Base and Subic Base. For use of a 245-square mile land area, the US was paying $200-million annual rental to the Philippine government, he said. “While Sabah, which has 28,430 square miles, or 116 times bigger than the US bases, the Malaysian government is only renting Sabah for a song.”

Pendulum

JACEL said her heart bleeds for Filipino refugees who have become hostage to the territorial pendulum. “The world needs to know about the plight of the halaws, people and children that have been driven away because of this,” she says. According to the Commission on Filipinos Overseas, the word halaw was used to describe persons whose heads were shaved to identify them as those to be “deported” from the port of Sendakan in Malaysia. Last year the Philippine Embassy in Kuala Lumpur reported that over 569,451, or 18.2 percent, of the total population of Sabah, are Filipinos, both documented and undocumented.

Death

SULTAN Jamalul Kiram III died months after the Lahad Datu siege. A younger brother, Esmail Kiram II, in a succession often beset by clan in-fighting and claims by fake descendants of the once-powerful Muslim royalty, succeeded him. When Esmail died on September 19, 2015, another brother, Phugdalon Kiram, was named as the new sultan. Based on the Kiram family tree, Jamalul was the closest living kin to the sultan, the nephew of 33rd

Sultan Esmail Kiram I and, at the same time, the son of crown prince Punjungan Kiram. Ex-Sen. Santanina Rasul also noted that former UN Secretary General Ban Ki-Moon had recognized him as the real heir. Jamalul was born on July 16, 1938, in Maimbung, a small town in the province of Sulu and was the eldest son of Sultan Punjungan Kiram and Sharif Usna Dalus Strattan and was directly descended from the first Sultan of Sulu, Sharif ul-Hashim of Sulu, of the Banu Hashem tribe. From Sulu High School he moved to Notre Dame in the capital of Jolo, and then enrolled at Manuel L. Quezon University in Manila, where he studied law, which he did not finish. Having joined the Ruma Betchara (Council of the Sultan) during the reign (1962-1974) of his uncle, Sultan Esmail Kiram, he ruled as “interim sultan,” while his father, who ruled between 1974 and 1981, was absent in Sabah. In 1984 he was proclaimed the 33rd (or possibly the 39th) Sultan of Sulu and was crowned in Jolo in 1986.

References

THE most exhaustive journal w r it ten about t he Saba h is sue is the Philippines Claim to Sabah: Legal and Historical Basis by Amando Respicio-Boncales, graduate student of Northern Illinois University. In that book, Boncales states the PhilippineMalaysian dispute over the State of Sabah remains “a contentious diplomatic issue.” Boncales’s objective of the study was to shed light on the historical background of the Philippines’s claim over Sabah by examining how various authors in the field presented the issue. According to the book, the “Sultanate of Sulu was founded in 1380, nearly one and a half century before the arrival of the Spaniards in the Philippines.” “ T he s u lt a n ate p o s s e s s e d an efficient politica l organization, extending its inf luence in Zamboanga, Basilan, Pa lawan, aside from the Sulu archipelago and was granted the northeaster n par t of the ter r itor y as a pr ize for helping the Su ltan of Br unei against his enemies in 1658,” Bonca les w rote. “ W hen the British came and ruled what was to be Ma laysia, the Philippine gover nment says the contract of 1878 was a lease, and not a transfer of ow nership or sovereig nt y.”

Boncales said a William Treacher, identified as governor of Borneo from 1881 to 1887, was present at the signing of the contract and a witness. Treacher, he wrote, “characterized the contract as a lease and referred to the money payment as annual rentals.” “The late Diosdado Macapagal, who served in the Department of Foreign Affairs in 1946 and later became President of the Philippines, filed a claim to the United Nations on June 22, 1962,” the book read. “It claimed sovereignty, jurisdiction and proprietary ownership of North Borneo claiming it has the legal and historical rights to North Borneo.”

Macaskie

CH A R LES M acaskie, one of Nor th Bor neo’s most successf u l colonia l officia ls, on the ot her h a nd , h ad a d i f ferent v iew, Bonca les w rote. The chief justice in 1934 and deputy governor in 1936, Macaskie sat as judge in a 1939 case where nine heirs of Sultan Jamalul Kiram claimed money owed to them under the 1878 grant. Through their lawyer, the heirs showed only an English translation of the Grant of 1878 that incorrectly presented the claim as a cession instead of a lease. (A later translation made it clear that this was an incorrect translation). Years after the Macaskie dictum was made, the Philippine government made moves to translate the Grant of 1878. The result showed it was a Lease Agreement. Francis Harrison, former United States governor general of the Philippines, eventually repudiated the Macaskie judgment. “Upon examination of our own translation of the original document [in Photostat] it will be seen that Maxwell and Gibson, the English authors on whose text the decision of Justice Mackaskie was based, have changed the language so as to make the document a grant cession instead of lease, as it really was, and as the word padjak in the original, really means,” Harrison was quoted in Boncales’s book. “In view of this vital divergence from the original text, I do not find myself able to give full faith and credit to the opinion of Justice Mackaskie in the famous case in 1939 in Sandakan.”

Quirino

IN a letter addressed to thenVice President and Secretar y of Foreig n A ffairs Elpidio R .

Qu ir ino, d ated Febr u a r y 27, 1947, Har r ison ex plained: “In reviewing the subject of the claims of the Sultanate of Sulu to their ancient patrimony in North Borneo, one must come to the conclusion that the action of the British government in announcing on the sixteenth of July [annexation of North Borneo to the British Crown], just 12 days after the inauguration of the Republic of the Philippines, a step taken by the British government unilaterally, and without any special notice to the Sultanate of Sulu, nor consideration of their legal rights, was an act of political aggression which should promptly be repudiated by the government of the Republic of the Philippines.” Harrison concluded: “The Malaysian claim to Sabah, based on the British claim, is not sustainable. The territory was only leased to the British North Borneo Company and not ceded as the Great Britain, and later Malaysia, had claimed.” The claimants also argued that the sultanate’s territory had been leased only to Britain, with no agreement on incorporation into Malaysia.

Hopes

EVERY year, the Malaysian Embassy in the Philippines issues a check in the amount of 5,300 Malaysian ringgit (about P77,000) to the legal counsel of Jamalul Kiram’s descendants. Before he became President Duterte’s spokesman, Harry L. Roque Jr., then a law professor at the University of the Philippines, said: “In my opinion, this is more consistent with a lease rather than a sale, because you can’t have a purchase price which is not fixed, and which is payable until kingdom come.” The Lahad Datu incursion in 2013 failed and former President Benigno S. Aquino III weighed in against her father saying the insurgency had caused “death and suffering among his own people.” Jacel, nonetheless, says the events “brought attention to the largely dormant issue of the claim by the Philippines to parts of Borneo, based on the Sultanate of Sulu’s past control over the area.” Decades and centuries may go, but Jacel says her family remembers its history as clear as it were yesterday. No change of presidency, not even the odds posed by the Malaysian security forces are going to make them forget that Sabah used to belong to the Sulu Sultanate.

Banking&Finance BusinessMirror

A8 Thursday, April 19, 2018 • Editor: Jun B. Vallecera

LandBank looking to expand in second-tier municipalities By Bianca Cuaresma

@BcuaresmaBM

overnment-owned Land Bank of the Philippines (LandBank) is looking to expand its branch network in so-called lower-ranked municipalities this year following the recent opening of a branch in Samal Island. In a statement on Wednesday, the state-controlled bank said it targets to open in particularly lower-ranked municipalities across the country at least 19 more branches after the Samal Island

branch opening. “A number of selected locations for our new branches belong to fourth-to sixthclass municipalities, the same areas we targeted in our financial-inclusion cara-

van,” LandBank President and CEO Alex Buenaventura said. “This is still in line with our fervent drive to promote greater financial inclusion, especially among Filipinos in the unbanked and underserved rural areas,” the banker added. The bank also said more than half of the targeted new branches will be opened in Mindanao. The government lender said more or less 10 new branches will be opened by this year. For Luzon, LandBank is looking to open seven new branches and an additional two more in the Visayas, bringing the new bank branch establishments to 19 this year. The latest LandBank branch established in Samal Island brings the lender’s total number of branches and extension offices to 380. The Island Garden City of Samal is a

fourth-class city in the province of Davao del Norte. “With LandBank’s presence in the Island Garden City of Samal, we look forward to be part of and be able to contribute to the economic growth of this city that is rich with potential to be one of our country’s well-loved tourist destinations,” Buenaventura said. The lender previously acquired the moribund Philippine Postal Savings Bank that, in January this year, was reconfigured as LandBank subsidiary lender and now known as the Overseas Filipino Bank (OFB). Its proponents seek eventually to deploy overseas units to better serve the remittance and funding requirements of millions of overseas Filipinos. So-called representative offices even now are to be made available in countries with huge concentrations of OFWs.

China central bank chief kicks off reign with ‘very clever’ move

echnocrat Yi Gang fended off heavyweight political contenders to become China’s first new central bank governor in 15 years. On Tuesday he showed why. In his first major policy move since replacing Zhou Xiaochuan last month, Yi oversaw a 1 percentage point cut in the reserve requirement for most banks. It was an innovative move that nailed multiple objectives—even if the People's Bank of China (PBOC) surprised everyone by announcing the decision without warning after office hours. Funding costs were lowered for small banks feeling the brunt of President Xi Jinping’s push to curb debt risk and more credit was freed up for efficient small businesses struggling to access bank loans. And by making it easier for small banks to lend, a squeeze on shadow banks also was maintained. Capping it all, policy aims were met with a net liquidity injection of just 400 billion yuan ($64 billion), nullifying fears of a sharp shift in monetary policy. “The risk is always that the market would interpret a reserve-ratio cut as an easing signal,” said Larry Hu, head of China economics at Macquarie Securities Ltd. in Hong Kong. “They know the risk of being misinterpreted, but still decided to move forward. Yesterday’s move suggests the new PBOC leaders have the guts to do the right thing.”

Societe Generale SA said “the design is really very clever,” Oversea-Chinese Banking Corp. called the action “innovative” and Mizuho Securities Asia Ltd. deemed it “a smart move.” “This shows that Mr. Yi is a very skilled and seasoned central banker,” said Mizuho’s Hong-Kong based chief Asia economist Shen Jianguang. The move will release about 1.3 trillion yuan in liquidity with 900 billion yuan of that used to repay money banks borrowed from the central bank under its medium-term lending facility (MLF), the PBOC said yesterday.

Case clippings

By Justice S J Ranada Jr. EVIDENCE–factual findings of trial court In a prosecution for rape, where there is no compelling reason to overturn the factual findings of the trial court because: 1) It is not shown that the Regional Trial Court has overlooked, misunderstood or misappreciated facts or circumstances that would have resulted in the acquittal of the accused; and 2) said findings are upheld by the Court of Appeals, the conviction should be upheld, with the civil indemnity, moral damages and exemplary damages increased to P100,000 each. People v. Bandoquillo 07 Feb. 201

Get updated with a relic

he word “relic” connotes antiquity and outmodedness, so how can one get updated with a relic? Well, only when it is not the word relic per se but an acronym. Here’s what I mean. As an association executive, I need to brush up and keep abreast of what’s happening in the association world, here and abroad. I also have to continue learning. As mentioned in my April 26, 2017, column, association management is a distinct field of management because of the unique environment of associations. Associations are unique in a sense that their main stakeholders are duespaying members. Typically, the association board selects, retains and evaluates a CEO (or an executive director) who is responsible for the day-to-day management of the association and its paid staff. Association managers are responsible for tasks similar to other organizations, such as human-resource management, financial management, meeting management, information-technology management and project management. Still, there are other aspects of management that are unique to association managers, such as membership recruitment, retention and engagement, volunteer management, development of non-dues revenues and fund-raising. Association managers must also be familiar with laws and regulations that

Association World Octavio Peralta pertain only to associations. Based on my experience, there are three tasks an association professional needs to do to continue learning and improving on association management, and the acronym for these tasks is Relic, which stands for: n RE—for reading. I subscribe to a lot of publications and articles on association management and governance, both online and in print. Online articles come in the form of blogs, e-books, e-magazines and e-newsletters. Prints are basically magazines from publishing companies that cater to associations and the events industry, as well as those produced by international associations and association management companies. n LI—for listening. As much as I can, I regularly attend seminars, webinars and forums on association leadership and related areas. Most e x posit ions for t he meetings, incentives, conventions and exhibitions industr y have a so-called

GR 218913 Del Castillo, J

Associations Day, which covers diverse educational topics, such as membersh ip, m a rket i ng , com mu n ic at ions, bra nd i ng , sponsorsh ip a nd volu nteer management. I listen intently to speakers and experts and contextualize their ideas and strategies into my own association. n C—for connecting. I keep in touch with people I meet in conferences: fellow association executives, subject matter experts, authors, topnotch speakers and resource persons. I seek their advice, invite them to speak in our own training programs and collaborate with them in joint activities. Connecting people and ideas is an essential part of the task of an association executive. So the Relic is a way of keeping yourself updated in your work as an association professional. After all, a “relic” also connotes something of value that has survived the test of time. The column contributor, Octavio “Bobby” Peralta, is concurrently the secretarygeneral of the Association of Development Financing Institutions in Asia and the Pacific (Adfiap) and CEO and founder of the Philippine Council of Associations and Association Executives. PCA AE enjoys the support of Adfiap, the Tourism Promotions Board and the Philippine International Convention Center. E-mail obp@adfiap.org

By replacing cash from the MLF with funds locked up in required reserves, banks will save about 80 billion yuan in financing costs, Shen estimates. Because it unfreezes liquidity for smaller banks that don’t have direct access to MLF funds, it may better support the borrowing needs of small a nd med iu m- si z e enter pr i ses, sa id Tommy X ie, an economist at OCBC in Singapore. Yi boasts more than two decades of experience at the central bank and was Zhou’s No. 2 for more than a decade before taking the helm. He’s the figurehead for monetar y policy, while banking and insurance regulator Guo Shuqing serves as party secretary and deputy governor. Yi won the post over higher-profile candidates that analysts say included Jiang Chaoliang, the Communist Party secretary for Hubei province. “Yi Gang has quickly stepped up and firmly gripped the policy wheel,” said Frederic Neumann, cohead of Asian economics research at HSBC Holdings Plc. in Hong Kong. “It’s a subtle adjustment of the PBOC’s policy stance, easing funding costs for banks while only expanding liquidity at the margin.”

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Inclusive devt a key issue at ADB meet By Rea Cu

@ReaCuBM

he Asian Development Bank (ADB) said some 3,000 to 4,000 delegates are expected to take part in the 51st annual meeting scheduled from May 3 to 6 this year in Manila, according to the Department of Finance (DOF). ADB Secretary Woochong Um told the DOF that 3,000 have so far registered with the ADB for the Manila conference. The number was seen to swell to over 4,000 as more are expected to submit their names when the date of the meetings draws nearer. Among the issues to be discussed during the meeting include globalization, technology and its impact on jobs and corresponding opportunities; private-sector mobilization in funding infrastructure; building climate-change resilience; expanding opportunities for women entrepreneurs; and using technology to maximize the skills of aging populations to make development inclusive. DOF Undersecretary Bayani H. Agabin will represent Finance Secretary Carlos G. Dominguez III at the annual meetings. In the Cebu leg of the ADB press launch, Agabin will be joined by a delegation from the Bank including Um; director general for Southeast Asia Ramesh Subramaniam; Philippines country director Kelly Bird; and Principal Country Specialist Joven Balbosa. Um said these are exciting times for this year’s host, the Philippines, which has maintained a steady pace of economic growth. The ADB projected local output or the country’s GDP to accelerate to 6.8 percent in 2018 “driven by increased investment.” “It’s been a period of high and sustained economic growth, the longest in 50 years. It’s also been an economic expansion that has occurred in a very sound macroeconomic environment,” Bird said at the launch of the 2018 Asian Development Outlook 2018 in which the ADB projected the Philippines to grow by 6.8 percent this year and 6.9 percent for 2019, slightly higher than its 2017 performance averaging 6.7 percent. Um said the ADB supports the government’s commitment to sustainable and inclusive growth by helping improve infrastructure, regional development, public service delivery, youth employment and education, and also minimizing disaster risks and expanding financial inclusion. Last year loans provided by the ADB to the Philippines reached a record-high $1.08 billion, with majority of the assistance going to infrastructure-related activities, especially in Mindanao.

Primer Group partners with AUB for WeChat Pay

sia United Bank (AUB), one of the fastest-growing universal banks in the Philippines, recently added the Primer Group of Cos., an ever-expanding retail and distribution company of the world’s top and premium consumer brands and industrial products, to its roster of accredited merchants for mobile payment facility WeChat Pay. WeChat Pay is the mobile wallet inside Chinese social messaging app WeChat, which allows Chinese tourists in the Philippines to conveniently and seamlessly make cross-border payments. Launched in the Philippines for the first time by AUB in November 2017, WeChat Pay is a fast, secure and convenient way to pay for shopping, dining, hotel and airline bookings, and other tourism-related activities of the Chinese, now the secondlargest inbound tourists in the country. Founded in 1985, the Primer Group has diversified and expanded its portfolio from premium-branded consumer goods to airconditioning, textile printing and manufacturing, digital printing, ecotourism, hospitality management and “green” (environmental) consultancy. With presence in 13 countries in Asia, Australia, Europe, Middle East and Africa, the Primer Group has over 150 premium brands and around 500 free-standing stores in the world. On the retail front, the Primer Group carries established brands, such as Columbia, Delsey, Dr. Martens, FitFlop, Fox Racing Herschel Supply Co., Jansport, Quiksilver, Roxy, The North Face, TUMI, and Victorinox,as well as the concept stores Bratpack, Flight 001, GRIND, Ladybag, Recreational Outdoor

eXchange (R.O.X.), Res|Toe|Run, Sneakpeek and The Travel Club. “In the dynamic and fiercely competitive retail sector, it’s a must to cast a wider net and allow shoppers to purchase at their utmost convenience or at a mere click of a button,” said Mags Surtida, head of AUB Credit Cards Business. “WeChat Pay is all about that: catering to a steadily thriving tourist base with an innovative, flexible way to pay.” The Chinese tourism market in the Philippines has enjoyed a tremendous growth of more than 30 percent in recent years, trailing South Koreans in the number of visits to the country. In 2017 Chinese tourist arrivals reached almost the 1 million. The Chinese tourist segment is the largest user base of WeChat, which has 963 million monthly active users as of its most recently reported quarter, closing in on a whopping 1 billion users. Developed in its home market of China by developer Tencent, WeChat has gone beyond popular voice- and textmessaging features to include games and mobile payment. “We are pleased to partner with AUB, as this alliance paves the way for us to deliver superior customer experience through convenient, seamless and secure mode of payment. By taking advantage of opportunities offered by new payment gateways, we are better poised to strengthen our position as one of the leading authorities in the retail industry, given our deep basket of travel and outdoor-gear brands composed of both heavyweight and up-and-coming labels,” said Jimmy Thai, president and CEO of Primer Group of Cos.

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Editor: Dennis D. Estopace • Thursday, April 19, 2018

Subic port attracting more shipping lines—SBITC exec

By Henry Empeño | Correspondent

UBIC BAY FREEPORT—More international shipping companies are now using the Port of Subic as their shipping gateway, according to the top executive of Subic Bay International Terminal Corp. (SBITC).

RISING RICE

A Filipino farmer carries a bundle of rice through the field in Daet, Camarines Norte, in Bicol. Palay production in Camarines Norte in 2017 rose by 19.12 percent to a record-high of 107,099 metric tons (MT), Philippine Statistics Authority data showed. The province produced 89,909 MT of palay in 2016. This is the first time that the province breached the 100,000-MT production level. ALYSA SALEN

Legality of DOE, Puerto Princesa waste-to-energy deal questioned N ON-GOVERNMENTAL organizations belonging to the No Burn Pilipinas (NBP) alliance questioned the legality of a contract signed by the Department of Energy (DOE) and local government officials for the establishment of a waste-to-energy (WTE) facility in Puerto Princesa City. WTE is being seen as a viable option for local government units with no capacity to implement Republic Act 9003 (Ecological Solid Waste Management Act of 2000) to effectively address the country’s looming garbage crisis both by the Department of Environment and Natural Resources (DENR) and the National Solid Waste Management Commission (NSWMC). In a statement, NBP said they find the P2.1-billion WTE deal “dubious” and called on the project’s proponent to cancel the contract. The NBP is composed of over 50 environmental-and climatejustice activist groups. Its leaders were reacting to the recent report on the contract signing between the DOE, Puerto Princesa City and Austworks Corp., the facility provider for the construction of a so-called WTE plant. Under the deal, Austworks will build a “thermal gasification” WTE incinerator in the city’s Santa Lourdes Sanitary Landfill, as well as provide garbage-collection services. The WTE plant will supposedly generate 5.5 megawatts of electricity from the city’s 110 metric tons per day of waste.

Clean air law

HOWEVER, the NBP claims the deal is illegal, since waste incineration is banned under the Clean Air Act. It added that the energy to be produced by the facility, if any, will be minuscule, debunking the project proponent’s claim that the facility will pay for itself from the energy it will generate. NBP also said there are no commercially operating thermal-gasification WTE incinerators anywhere in the world. The group added that the company involved has no known record for building similar facilities anywhere in the world. “The planned waste-to-energy incinerator in Puerto Princesa is patently illegal under Philippine law,” NBP Spokesman Ruel C. Cabile was quoted in the statement as saying. Cabile added the signing of the contract and the project’s implementation is a clear violation of the ban on incineration enshrined in the Clean Air Act. “It also contravenes the Ecological

Solid Waste Management Act, which the government should be strengthening,” he said. “Pursuing waste-toenergy incineration undermines segregation, recycling and reduction efforts—the very approaches that the government should be supporting.”

ECC violation

ACCORDING to Kathryn Leuch of NBP group member Environmental Legal Assistance Center, Puerto Princesa’s current sanitary landfill was intended to evolve into a zerowaste management program, as provided in the Environmental Compliance Certificate (ECC) issued to the city government. “The pursuit of WTE would result to a violation of the ECC,” Leuch said. “We hope that the Puerto Princesa City government can still reconsider its planned incineration project and prioritize zero-waste management in its development master plan.” She added they were expecting Puerto Princesa City government officials to “sustain environmental-protection efforts” given that the city is a hall of fame awardee in the ‘Clean and Green Program’ of the Philippine government. The NBP also questioned the DOE’s promotion of WTE incineration, saying it is the most expensive and inefficient way to produce electricity, with construction costing twice that of coal-fired power plants and 60 percent more than nuclear plants. Moreover, its operations cost ten times more than coal and four times more than nuclear, according to the group Philippine Movement for Climate Justice (PMCJ). The PMCJ claims that “WTE incineration is bad for the climate and is not renewable energy.” “It takes investments away from real energy solutions, such as wind and solar,” the group said.

More doubts

ANOTHER NBP group member, the Global Alliance for Incinerator Alternatives (Gaia), noted in a document that “gasification plants are some of the most complex and expensive incinerators and are not recommended as suitable waste-treatment facilities in developing countries.” “In fact, no commercial-scale gasification plant meant for the treatment of municipal solid waste exists anywhere in the world,” the group claims. The group added it doubts the facility will actually operate successfully even if it is constructed. “Gasification’s history of technical challenges and failures has led to shutdowns in operation, which

have left some cities and taxpayers in debt, paying for prohibitively expensive facilities that never worked,” the PMCJ claims. Environmental groups say that cities and municipalities should be extremely wary of incinerator companies selling the idea of “quick fix” incinerators.

Not first

THEY said the case of Palawan is not the first WTE deal that seems “too good to be true.” In 2011 Angeles City was also lured into investing in a $63-million WTE facility. It never materialized, according to NBP. In 2006 the City of San Fernando in Pampanga entered into a contract for a gasification facility that was started but never completed, the group added. Shortly after the failure of the gasification plant, the City of San Fernando, chose to instead pursue a zero-waste program. The city was able to drastically reduce the volume of municipal waste in six months. In the past, the city brought almost 90 percent of its waste to landfills. With its program, this figure was reduced to 30 percent in the last four years. “Zero waste is still the best approach for the sustainable management of discards,” the NBP statement said. “Waste is a complex problem that can’t be solved by a machine that burns trash and merely converts solid waste to toxic air pollution. The government should support zerowaste approaches instead of partnering with incinerator companies that sell false solutions to cities and municipalities.”

Booming destination

PUERTO Princesa City is a booming tourist destination in the islandprovince of Palawan, considered as the country’s last ecological frontier. Home to the Puerto Princesa Underground River, it is teeming with lush forest and is the only carbon-neutral city in the Philippines. Tourism and the city’s increasing population, however, is taking its toll on the environment, with garbage disposal increasingly becoming a health and environmental issue. Puerto Princesa has a total population of 255,116 based on the 2015 Census of Population. Garbage produced daily has significantly increased from 110 tons a day in December last year to almost double in last three months of the year, according to local news reports quoting the city’s officials. Jonathan L. Mayuga

shipping firms like Singaporebased American President Lines, Mitsui O.S.K. Lines of Japan, Wan Hai Lines, K Line, South Korea’s Hanjin Shipping and Maersk Line of Denmark. The other lines using Subic for transhipment are Avega Bros. Integrated Shipping Corp., Baliwag Navigation Inc., Chealsea Shipping Corp., Eastern Shipping Corp., Fortune Sea Carrier Inc., Matsya Shipping Lines Corp., NYK Fil-Japan Shipping Corp., Ocean Tankers Corp., Petrotrade Philippines Inc., Seen Sam Shipping Inc., Shinline Sdn BhdT, Sinotrans Shipping, SITC Container Lines Philippines Inc., Swire Shipping, T. Madsen Shipping Philippines Inc., Teekay Shipping Philippines and Uni-Ship Inc. Locsin said the SBITC strategically serves the industries within the Subic free port and those in Northern and Central Luzon. He added the company has now included interisland Philippine barge service to connect customers from Palawan, the Visayas and Mindanao with a transhipment port. Aside from managing the Subic container terminals, SBITC offers cargo-handling services for 20foot and 40-foot equivalent unit container vans, as well as 45-foot boxes for full container load and specialized cargo.

SBITC President Roberto Locsin said more shipping lines have partnered with his company to expand their footprint in the Philippine market and are now finding Subic to be an “excellent alternative gateway to Manila.” Locsin noted one of these as MCC Transport Singapore Pte. Ltd., a cargo-shipping specialist for the Maersk Group, which started to use the Subic terminals in four years ago to increase its presence in the Central and Northern Luzon market. He said MCC Transport now provides feeder services for a wide range of regional and global beneficial cargo owners and manages all Intra-Asia containerized cargo for the Maersk Group. Another Subic port user is Hong Kong-based SITC International Holdings Co., Ltd., a lead-

ing shipping logistics company in the intra-Asia area, which has successfully tapped the Filipino market by opening opportunities for clients from Northern Luzon to lessen costs in delivering products to their target market. Locsin credits his firm’s “efficiency and high-quality cargo- and container-handling services” for the decision of SITC to expand its operations. He also noted his firm’s partnership with Evergreen Marine Corp. (Taiwan) Ltd. beginning this month and which focuses on target VIP clients for use of the Subic port. As of now, more than 20 shipping lines make regular calls at the Subic Bay Freeport Zone, according to figures provided by the Subic Bay Metropolitan Authority. These include international

Cebu exec bares steps to ease vehicular traffic

Aklan mayors plan to fund volunteers for Boracay rehab

REPRESENTATIVE of the Cebu Provincial Government laid down the Capitol’s immediate plans of action aimed at easing the traffic concerns in the province. Jonathan F. Tumulak, focal person on traffic management, said he plans to release traffic advisories through the Provincial Information Office (PIO) and to relay the need for assistance and traffic management to concerned offices, such as the Provincial Disaster Risk Reduction and Management Office (PDRRMO). Both PDRRMO and Tumulak aided Minglanilla town in managing the traffic during its annual celebration of the “Sugat Kabanhawan” Festival on April 1. The Capitol is also set to conduct a series of trainings for traffic managers, specifically on traffic-law enforcement, traffic engineering and road-safety audit, according to the former Cebu City Traffic Office Operations chief. Tumulak said he also wants traffic enforcers to work in unison from the signs they use when directing traffic to the road signs placed. According to the 2017 data from the Land Transportation Office, there are 574,819 motor vehicles in Cebu Province. The LTO expects the number to increase to at least 800,000 by the end of 2018. With the influx of newly registered vehicles expected this year, Tumulak said the Capitol aims to help in the establishment of a Traffic Management Office in local government units that do not have one yet. “We will aid in the construction of traffic-management office because we are expecting our neighboring municipalities’ [economy to experience a] boom,” he said. In San Fernando town, the traffic gridlock experienced by motorists on April 10 along the stretch of Barangay Pitalo, prompted town officials to craft regulations and pass a traffic code that would help ease vehicular jams especially during fiesta celebrations, Tumulak added. Charles R. Pepito

ORACAY Island, Aklan—The 16 local chief executives in the province are currently considering sending off residents as volunteers to help in the rehabilitation of this resort island for six months. “We are considering sending off at least 20 volunteers per town to help in the Boracay rehabilitation,” Malinao Mayor Wilbert Ariel Igoy said. “Their allowances may be sourced out from both the budget of the local government and the provincial government.” Igoy, the president of the Provincial Mayors League, said they have been asked by the Aklan provincial government to send delegates. When plans have been finalized, the volunteers are being eyed to stay in public schools during summer. By June in the opening of classes, they will be accommodated at the covered gym of the barangays of Balabag and Manoc Manoc. “Everybody in the province is affected by the six months of closure as ordered by President Duterte,” Igoy added. Meanwhile, the Aklan Electric Cooperative (Akelco) is also eye-

ing to seek the help of the power cooperatives all over the country to speed up relocation of electric poles during the six months closure of Boracay. Akelco General Manager Alexis M. Regalado said the volunteers to be named as Task Force:Kapatid will be deployed in Boracay. A tourism advocate has claimed the six months closure of Boracay Island have gained worldwide respect as the Philippine government is going to sustainable tourism. Former Consul General Robert Lim Joseph, now a consultant of Tourism Secretary Wanda Corazon T. Teo, said the closure is an eye-opener. Joseph accused resorts of failing to obey the rules and dumping waste into the sea. He added it is also important that structures encroaching the shoreline be completely taken down. Joseph echoed the need for Boracay to have a functional sewerage-treatment plant and wider roads. Joseph said hotels should also use the time to repaint and undertake repairs. Jun N. Aguirre

More new retail space rising in Bacolod City in next 3 yrs.

A C O L O D C I T Y— A b o u t 140,000 square meters (sq m) of new retail space is expected to be available in this city in the next three years, according to global real-property services firm, Colliers International Philippines. As of April 16, Colliers reported that Bacolod’s retail stock reached almost 318,000 sq m by the

end of 2017. By 2020, Colliers projected the city’s retail space to reach by as much as 462,000 sq m, higher by 43 percent than the 2017 stock. In Negros Occidental, SM City Bacolod’s north and south wings have a combined 107,000 sq mof leasable space, which accounts for more than 30 percent of the retail space here. PNA

A10 Thursday, April 19, 2018 • Editor: Angel R. Calso

Opinion BusinessMirror

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editorial

A greener Boracay

tarting next Thursday, the powdery white sand of Boracay will be off-limits to local and foreign tourists for at least six months. As residents, resort owners and workers prepare for the island’s closure on April 26, architect and urban planner Felino Palafox Jr. shared his company’s plan for the rehabilitation of the troubled paradise. Palafox, whose company has been commissioned by the local government of Malay to create a rehabilitation plan, envisions a Boracay that features greener structures, more open spaces and eco-friendly ways of transporting people. If he has his way, the island’s land area will be 70-percent open space, and 30 percent earmarked for establishments. Using Maldives as a model, Palafox presented his recommendations in the specific areas of transportation, drainage, infrastructure, waste management, power and security. He suggested that only battery-operated trikes, buses, monorails and cable cars should be allowed. There will be bike-friendly areas and a possible rail system on the island. Regarding infrastructure, Palafox recommended that beachfront establishments must be at least 50 meters away from the high-water level mark. Buildings should not be taller than the coconut trees and, more important, all establishments must have their own sewerage-treatment plant. He said the government must strictly enforce the law and demolish structures illegally built in wetlands and forestlands. Palafox said Boracay’s rehabilitation would take years, way past the mandated six months closure, which is just enough time for violators to do corrective measures. “When we do plans good for 15 years, what we do is good for a hundred years. It’s more of a vision plan. Then we work backwards—long term, medium term, short term and immediate action. What is currently being done is immediate action,” he explained. If there’s social acceptance, Palafox would even have cable cars in the sky to connect the three islands of Northern Aklan, Boracay and Carabao “so you can see above the beauty of the place, and also the violators.” Palafox said the government should establish Boracay’s carrying capacity, which means limiting the number of tourists allowed on the island. He cited the Underground River in Puerto Princesa where they limit the number of tourists allowed per day. “In 2010 we have 700,000 visitors to Boracay. This ballooned to 2 million in 2017. Without sewer and all, I think we should only accept 500,000 visitors a year. We have to upgrade the utilities to carry the rising population,” he said. The veteran architect also urged Boracay residents to be more vigilant and make it a habit to report violators of environmental laws. “The degradation that happened in Boracay will never happen in Singapore,” he said. “That’s because Singaporeans are vigilant. If you have stagnant water in your place, for example, your neighbor will report you to authorities. If you produce so much noise, you will be reported. We should be like them. With the social media, we should have a stronger sense of citizenship. We must report violators [of environmental laws].” In reaction to reports that the Philippine Amusement and Gaming Corp. recently granted a “provisional license” to Macau casino giant Galaxy Entertainment and its Filipino partner, Leisure and Resorts World Corp., to build a 23-hectare casino-resort worth $500 million on the island, Palafox said he is against the proposed construction of a casino-resort in Boracay because this will damage the quality of the sand. He said it might be better to build the casino on the mainland, in the town of Malay in Aklan. Since 2005

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Your emotions are killing you John Mangun

OUTSIDE THE BOX

ven a brief Internet search will bring you to expert web sites carrying articles, such as “Can your emotions kill you?” followed by “Five emotions that could kill you”. And if that is not enough there is “8 ways your emotions are killing you”. If you believe you are a victim of your emotions, dozens of other experts will provide you with help to “consistently make positive life choices and channel the supremely potent energy charges triggered by your potentially sabotaging emotions.” You will soon be able to “think and reason clearly destructive-emotion-free.” From the beginning you will learn that hurt, anger, disappointment, rejection, rage, betrayal, insecurity or hopelessness is your problem. When it comes to putting your money to work, others have identified the emotions that can limit your ability to invest for profits. Honestly, they get a little strange in my opinion. You can miss out because of

“shame” by avoiding to put your money into investments that are not “politically correct” or go against a person’s “moral compass” like pornography or medicinal marijuana. At least we do not have that problem in the Philippine stock market. But, realistically, if you experience “envy,” you might try to buy the same issues that successful investor has bought, but then end up being late to the party. If you are into “pride,” then you have no business in the stock market because pride will keep you making the same mistakes over and over again. If you are a stock market investor that wants to take fairly active control of your trading rather than buy and wait for the end of the next decade to sell out, the emotions that will

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damage your wealth are different. The wise old saying, which you are perhaps used to, that the stock market runs on greed and fear is absolutely a portfolio killer. “Buy when others are fearful and sell when others are greedy” is one of those Warren Buffett quotes that people do not understand and costs money. That thought has nothing to do with the stock market. It has to do with when everyone is greedy to open a pearl shake kiosk, time to get out. When everyone is afraid that Filipinos will never buy Shawarma, it is time to get in. Actually, your greed will get you in too soon because you think that the stock price is so cheap. And then it goes lower. Your fear will get you out too soon near the top because you are afraid of missing the profit. Both keep you from maximizing your profit.

Keeping a tight rein on security funds

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You can miss out because of “shame” by avoiding to put your money into investments that are not “politically correct” or go against a person’s “moral compass” like pornography or medicinal marijuana. At least we do not have that problem in the Philippine stock market.

Cecilio T. Arillo

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resident Duterte must keep a tight rein on state security funds and other multitrillion-peso assets that appeared to be the favorite targets of grafters, plunderers and other scammers in the past and at present. The mainstream media and the cyberspace are littered with stories of multibillion-peso scams of every size, shape and make. In particular, the President should focus his attention on state funds from the Government Service Insurance System (GSIS), Social Security System and the Home Development Mutual Fund, more popularly known as the Pag-IBIG Fund, each with multibillion-peso security currencies used in placements and other money transactions in local and foreign markets. Most of their foreign transactions are curiously riven by secrecy and employ foreign brokers, people who have no public accountability at all, especially in interest-rates earnings for state funds invested in the global currency transactions. Members of these three big financial institutions and the public are

usually kept in the dark. The best way to keep a tight control on state funds is to make every transaction transparent as required by Executive Order (EO) 2 that President Duterte himself issued on July 23, 2016, and a related law, Republic Act 9485, signed by former President Gloria Macapagal-Arroyo on June 2, 2007, “To improve efficiency in the delivery of government service to the public by reducing bureaucratic red tape, preventing graft and corruption, and providing penalties therefor.” EO 2 “operationalizes in the Executive branch the people’s constitutional rights to information and the state policies of full public disclosures and transparency in public

The issue of transparency came to the fore again this week when a special interest group advancing the welfare of government employees from around the country was appalled that state-owned GSIS has allegedly chosen to be secretive about its investment activities, despite their repeated requests for complete accounting and transparency on the matter. service and providing guidelines therefor.” The issue of transparency came to the fore again this week when a special interest group advancing the welfare of government employees from around the country was appalled that state-owned GSIS has allegedly chosen to be secretive about its investment activities, despite their repeated requests for complete accounting and transparency on the matter. Renowned lawyer Jesus I. Santos, speaking for the Confederation of Government Employees Organizations Inc. and the National Association of Lawyers for Justice and Peace, said the two organizations have since asked the GSIS to account for multibillion peso worth of pension funds deployed in overseas markets ostensibly for the benefit and welfare of millions of GSIS

The No. 1 negative and damaging emotion is regret. No, I am not talking about “The regret of my life is that I did not say ‘I love you’ often enough.” That has to do with a fool who could not find balance. Regret is wanting to turn back the clock to do something differently and thereby being paralyzed. When it comes to your stock market investing, if you ever utter out loud the words “I should have/could have…,” your portfolio is doomed. You bought an issue at P80 and it made a nice move to P100. But then it quickly went back down to P80. No reason to sell now because “I should have sold at P100.” At P70, you regret not having sold at P80 and this vicious and destructive pattern continues as the price continues to move down to P50. The one emotional response to stock market investing that you absolutely must display is feeling humble. If you do not accept that you are not a stock market genius who knows everything, the stock market will slap you into being humble. E-mail me at mangun@gmail.com. Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stockmarket information and technical analysis tools provided by the COL Financial Group Inc.

members but that their pleadings continued to fall on deaf ears. A former GSIS director, Santos has written the then-officer in charge of the Office of the President and general manager at the fund a letter for the group to be informed on the financial standing of GSIS funds and assets, copies of the board resolution, investments and expenses of then-GSIS President and General Manager Robert Vergara, as well as explain why the provident funds of the late former GSIS trustee Alejandro Roces and that of his own were denied them. Roces, former President Diosdado Macapagal’s education secretary and a National Artist awardee for literature, and Santos, known for his strong advocacy against illegal logging in the Angat Dam watershed, the major source of potable water for Metro Manila and a great part of Bulacan, were appointed board members of the GSIS by Arroyo and had served their term with distinction until 2010 when President Benigno S. Aquino III took over the presidency. Before he died in 2011 at the age of 86, Roces made a will, with his family and Santos as his witnesses, that his provident fund benefits earned as GSIS trustee be donated to a charitable institution. Up to See “Arillo,” A11

Opinion BusinessMirror

www.businessmirror.com.ph

Fair competition for a fair and free market

Heroic leadership Msgr. Sabino A. Vengco Jr.

Alálaong Bagá

Ariel Nepomuceno

DECISION TIME

assimo Motta, in his book entitled Competition Policy Theory and Practice, mentioned that the main objective of competition policy as enforced by the European Commission are probably economic efficiency and European market integration. He stated that the first purpose of such policy is the maintenance of competitive markets. Competition policies serve as instruments to encourage industrial efficiency, the optimal allocation of resources, technical progress and the flexibility to adjust to a changing environment. Thus, the European Community competition policy has always taken a very strong line against price fixing, market-sharing cartels, abuses of dominant positions, and anticompetitive mergers. It has also prohibited unjustified state-granted monopoly rights and state-aid measures that do not ensure the long-term viability of firms but distort competition by keeping them artificially in business. To him, the fundamental objective of welfare encompasses total surplus, consumer surplus, defense of smaller companies, promotion of market integration, economic freedom, fighting inflation and the internationally accepted norms of fairness and equity in the market place. The above-mentioned principles have been incorporated in many laws around the world, in recognition of the need to regulate the absolute and unbridled freedom to contract, forcing companies and industries to behave in an equitable/considerate way with respect to both its customers and competitors. In the Philippines former President Benigno S. Aquino III signed into law the Philippine Competition Act (Republic Act 10667) on July 21, 2015, and established the Philippine Competition Commission (PCC) to enforce such Act. RA 10667 disallows abuse of dominant position, anticompetitive agreements, mergers and acquisitions. Before the passage of this law, antitrust provisions can be found in different laws covering different industries, such as the Electric Power Industry Reform Act, Public Telecommunication Policy Act, Downstream Oil Deregulation Act of 1998 and the general banking law. The Department of Justice and other government agencies played a central role in making sure that aforementioned laws are complied with by way of filing relevant cases. As such, business and industry welcomed the creation of the PCC, which is headed by a very driven and capable leader in the person of Dr. Arsenio Balisacan. Under his leadership, the PCC’s basic aim is to be a world-class authority in promoting fair market competition to help achieve a vibrant and inclusive economy and advance consumer welfare.

Arillo . . .

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now, the GSIS strangely refused to release their provident funds while the benefits of other trustees had already been released. Santos, now 92 but still active in legal practice, and his clean-environment advocacies bewailed the continued refusal of the GSIS to release their benefits. “I and Anding Roces worked as trustees at the GSIS and earned the benefits that continued to be denied us,” he protested. Santos also dwelt on the controversial sale of the 18-story Philcomcen building along Ortigas Avenue that the GSIS sold to the Gotianuns of Filinvest for some P772 million as part of the pension fund’s earning with no mention of the total principal amount involved in the deal of the prime property.

Their mission acknowledges that sound market regulation will help foster business innovation, increase global competitiveness and expand consumer choices to improve public welfare. Over the last few years, the PCC has come up with significant accomplishments. They have released the implementing rules and regulations for RA 10667 after conducting robust public consultations in 2016, worked relentlessly with the National Economic and Development Authority on the Charter on national competition policy and the Philippine Development Plan, drafted mergers and acquisitions guidelines, and conducted various reviews of a growing number of mergers and acquisitions notifications. Even joint ventures are now being looked into, and how these entities can and should comply with RA 10667. Realizing that enforcement is key to ensuring a truly competitive market, the Competition Enforcement Office and rules relating to the same have already been drafted by the PCC. To engage both internal and external stakeholders, it has also done a variety of local capacitybuilding workshops on relevant topics, such as cartel investigation and competition law and economics. The drive is to create a regulatory environment for market competition to protect consumers and promote competitive businesses. At the end of the day, achieving the objectives of the PCC will, in reality, redound to the benefit of Juan de la Cruz. While we have seen positive indicators in our economic life, the PCC fully recognizes that there remains a challenge in attaining economic development where no one is left behind. This vision is unique because it also institutionalizes the value of inclusiveness where the sweet fruits of economic progress are shared by not a few but by all. For comments and suggestions arielnepo.businessmirror@gmail.com

very year for the Fourth Sunday of Easter, the Gospel Text is taken from Chapter 10 of John, the discourse on the good shepherd. Our reading for Year B (John 10:11-18) is an interpretation of the short parable about the sheep who are called by name and who follow their shepherd whom they recognize.

They know him IN the original Palestinian setting, sheepfolds were enclosures fenced off by stones or briars at the outskirts of the village, and a village with a common sheepfold meant that, at night, all the sheep were corralled together and the shepherds take turn as guards or gatekeepers. To take the sheep to pasture in the morning, each shepherd would gather his own flock from the common herd. The sheep would be called by its name, and would respond only to the particular whistle or familiar call by its shepherd. Leading them, the shepherd went before his flock, and they would follow him because

Businesswise Then GSIS OIC President and General Manager Nora MalubaySaludares told Santos in a letter that the investment decision of the GSIS board of trustees and management he has sought are subject to so-called disclosure guidelines under Board Resolution 241 on November 24, 2011, that vested those decisions a level of secrecy categorized as Highly Classified Information that may not be shared so openly with anyone. Such commercially sensitive transactions, Saludares claimed, have very limited disclosure range. But Santos is not satisfied with her explanation knowing the laws that give greater transparency, efficiency and safeguard on GSIS investment decisions against all type of transactions. To reach the writer, e-mail cecilio.arillo@ gmail.com.

He would lay down His life for them A true shepherd is willing to do all for his sheep. “A good shepherd lays down his life for the sheep.” Such commitment cannot be expected of someone who is not a shepherd (who has a personal relationship with the sheep), whose sheep are not his own (they do not relate with him either), because he is only a hireling (one who does the shepherding for money). Such a hired person works for pay and has no concern for the sheep, and when danger comes he thinks of himself first. Such false shepherds in the history of God’s flock Israel were painfully plentiful, leaders who really cared nothing for the flock but only for themselves. Laying down his life for His sheep was exactly what Jesus did. He was committed for the salvation of humankind, and we have come to believe in him. “I know mine and mine know me.” In the context of this mutuality of gracious love and complete trust, Jesus insists that he lays down His life on His own; no one takes it from him. Jesus was not a helpless victim but a freely sacrificing savior. And He has the power to lay it down and the power to take it up again. The

whole Paschal Mystery of his death and glorious resurrection and ascension make up the one indissoluble act of carrying out the plan of His Father who loves Him as He lays down His life in order to take it up again. The same love of the Father and the Son is for all humanity, hence Jesus must also lead “other sheep that do not belong to this fold.” He must take them all home with Him to the Father. Alálaong bagá, so much revolves around the shepherd, when we talk of the welfare of the flock. To have one flock and one shepherd, it is necessary for all to know the one shepherd, listening to his voice and following him, even as the good shepherd inspires the flock with his radical commitment and integrity. We pray that we may have always such good shepherds in the format of Jesus to look after the welfare of the flock. May we be blessed with leaders, both spiritual and civil, who are capable of heroic leadership, transcending selfish interests and sacrificing themselves to put first the people of God. Join me in meditating on the Word of God every Sunday, from 5 to 6 a.m. on DWIZ 882, or by audio streaming on www.dwiz882.com.

A more fluent Donor’s Tax under the TRAIN Law Atty. Fermo B. Avila

Tax Law for Business

he common tao would prefer a law stated in simple terms and provisions, rather than a statute cached in complex parlance. Scott Leigh opined that this human tendency can be explained by a term in psychology called “fluency”, which means “the ease with which you process something”. Provisions stated in terms that people already know and understand are more “fluent” than provisions stated using reasoning people can’t follow or terms that people do not understand. With the dawn of Tax Reform for Acceleration and Inclusion (TRAIN) Law, the provisions regarding Donor’s Tax under the Tax Code became simpler and less arduous. The salient changes in the provisions on Donor’s Tax are as follows: (1) the concept of “stranger” was removed; (2) the schedular rates were replaced by a uniform rate of six percent; (3) the inclusion of an annual exemption

worth P250,000; (4) the addition of a presumption with regard to sale, exchange or other transfer of property made in the ordinary course of business; and (5) the removal of “dowries or gifts made on account of marriage” as part of those exempt gifts. The TRAIN Law amended Section 99 of the Tax Code and removed the distinction between a “general taxpayer” and a stranger. It further

Earth, wind and liars By Paul Krugman

New York Times News Service

Val A. Villanueva is on leave.

they knew his voice. As the sheep recognize and follow their shepherd, so also those who know Jesus as their Lord and savior follow Him. But they have to be familiar to His voice and attentive to His words. That is why Christians do not gather together in the presence of the Lord in any celebration without the liturgy of the word. This is an irreplaceable level of interpersonal communication in any real and intimate relationship with Jesus. Also, any form of Christianity that is not shaped by the Gospel of Jesus would be insensitive to His vital teachings and a stranger to His true spirit.

Thursday, April 19, 2018 A11

eter Thiel, Facebook investor and Donald Trump supporter, is by all accounts a terrible person. He did, however, come up with one classic line about the disappointments of modern technology: “We wanted flying cars, instead we got 140 characters.” OK, now it’s 280, but who’s counting? The point of his quip was that while we’ve found ever more clever ways of pushing around bits of information, we are still living in a material world—and our command of that material world has advanced much less than most people expected a few decades ago. Where are the technologies transforming the way we deal with physical reality? Well, there is one area of physical technology, renewable energy, in which we really are seeing that kind of progress—progress that can both change the world and save it. Unfortunately, the people Thiel supports are trying to stop that progress from happening. Not that long ago, calls for a move to wind and solar power were widely perceived as impractical, if not hippie-dippy silly. Some of that contempt lingers; my sense is that many politicians and some businesspeople still think of renewable energy as marginal, still imagine that real men

burn stuff and serious people focus on good old-fashioned fossil fuels. But the truth is nearly the opposite, certainly when it comes to electricity generation. Believers in the primacy of fossil fuels, coal in particular, are now technological dead-enders; they, not foolish leftists, are our modern Luddites. Unfortunately, they can still do a lot of damage. A bout t he tec hnolog y : A s recently as 2010, it still consistently costs more to generate electricity from sun and wind than from fossil fuels. But that gap has already been eliminated, and this is just the beginning. Widespread use of renewable energy is still a new thing, which means that, even without major technological breakthroughs, we can expect to see big further cost reductions as industries move “down the learning curve”—that is, find better and cheaper ways to operate as they accumulate experience. Recently David Roberts at Vox.com offered a very good example: wind turbines. Windmills have been around for more than 1,000 years, and they’ve been used to generate electricity since the late-19th century. But making turbines really efficient requires making them very big and tall—tall enough to exploit the faster, steadier winds that blow at higher altitudes. And that’s what businesses are

or money’s worth. This provision bolsters a taxpayer’s position to exclude from donor’s tax those transactions that were entered at arm’s length despite a disparity between the market value of the property and its transfer price/value. With the introduction of these changes in the Tax Code, the provisions on Donor’s Tax have become more straightforward, less complicated and easier to follow. While there is no guarantee that a more fluent Tax Code will result in higher collection of taxes, let alone compliance from the taxpayers, our lawmakers have done a great job in titivating its provisions.

provided for a uniform Donor’s Tax rate of 6 percent computed on the basis of the total gifts in excess of P250,000 exempt gift made during the calendar year. This annual exemption amounting to P250,000 is a new item in the computation of the net taxable gifts for the calendar year. The TRAIN Law also removed, from the list of the exempt gifts made by a resident, the provision on “dowries or gifts made on account of marriage and before its celebration or within one year thereafter by parents to each of their legitimate, recognized natural or adopted children to the extent of the first P10,000.” Interestingly, the TRAIN Law introduced a presumption with regard to “Transfers for Less Than Adequate and Full Consideration.” Section 100 of the Tax Code was amended to provide that “a sale, exchange or other transfer of property made in the ordinary course of business (a transaction that is a bona fide, at arm’s length and free from any donative intent), will be considered as made for an adequate and full consideration in money

The author is a junior associate of Du-Baladad and Associates Law Offices (BDB Law), a memberfirm of WTS Global. The article is for general information only and is not intended, nor should be construed as a substitute for tax, legal or financial advice on any specific matter. Applicability of this article to any actual or particular tax or legal issue should be supported therefore by a professional study or advice. If you have any comments or questions concerning the article, you may e-mail the author at fermo.avila@ bdblaw.com.ph or call 403-2001 local 150.

learning to do, via a series of incremental improvements—better design, better materials, better locations (offshore is where it’s at). So what we’ll be seeing in a few years will be 850-foot turbines that totally outcompete fossil fuels on cost. To paraphrase the science-fiction writer William Gibson, the renewable-energy future is already pretty much here; it’s just not very evenly distributed. True, there are issues of intermittency remaining—the wind doesn’t always blow, the sun doesn’t always shine—although batteries and other energy-storage technologies are also making rapid progress. There are also some energy uses, especially transportation, where fossil fuels retain a significant advantage in cost and convenience. And exactly how we’re going to have carbonneutral air travel is still, well, up in the air. But there is no longer any reason to believe that it would be hard to drastically “decarbonize” the economy. Indeed, there is no reason to believe that doing so would impose any significant economic cost. The realistic debate is about how hard it will be to get from 80-percent to 100-percent decarbonization. For now, however, the problem isn’t technology—it’s politics. The fossil-fuel sector may represent a technological dead end, but it still has a lot of money and power.

Lately, it has been putting almost all of that money and power behind Republicans. For example, in the 2016 election cycle the coal mining industry gave 97 percent (!) of its contributions to GOP candidates. What the industry got in return for that money wasn’t just a president who talks nonsense about bringing back coal jobs and an administration that rejects the science of climate change. It got an Environmental Protection Agency head who’s trying to suppress evidence on the damage pollution causes, and a secretary of energy who tried, unsuccessfully so far, to force natural gas and renewables to subsidize coal and nuclear plants. In the long run, these tactics probably won’t stop the transition to renewable energy, and even the villains of this story probably realize that. Their goal is, instead, to slow things down, so they can extract as much profit as possible from their existing investments. Unfortunately, this really is a case of “in the long run, we are all dead.” Every year that we delay, the cleanenergy transition will sicken or kill thousands while increasing the risk of climate catastrophe. The point is that Trump and company aren’t just trying to move us backward on social issues; they’re also trying to block technological progress. And the price of their obstructionism will be high.

2nd Front Page BusinessMirror

A12 Thursday, April 19, 2018

Gloom descends on Boracay as closure date approaches By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

ORACAY Island, Malay, Aklan—A pall of gloom has descended on the island of Boracay, as residents, business owners, workers and vendors grimly count the days to the closure of their beloved home, many of them uncertain of their future.

Manny Casidsid, president of the Masboi Paraw Association, told the BusinessMirror many of the association’s 639 members are still at a loss on what to do after the island is closed on April 26. “Meron nag-iisip pumunta ng Manila, para maghanap ng trabaho [Some are thinking of going to Manila, to look for work],” he said. He added the Department of Social Welfare and Development (DSWD) has already approached the association members for the agency’s promised cash-for-work program, but pointed out that the daily minimum wage that will be paid the workers, will hardly be enough to support the needs of their families. Because they are in Western Visayas, they will be paid a minimum wage of only P268 per day, and not the P325 a day, the government has announced. He noted this was much

April 26

Paraw, the traditional fishing boats in Boracay, crowd station 2, pick up tourists for a sunset cruise around the island. From cruise earnings of P600 a day, paraw sailors have been offered a P268-daily wage in the government’s cash-for-work program while the island is closed for six months. The work involves cleaning up Boracay and helping demolish illegal structures. Stella Arnaldo

lower than the P300 to P600 a day the paraw sailors actually earn from taking tourists on a cruise around the island. “Sa P268 a day, babayahe pa kami araw-araw mula Caticlan papuntang Boracay, P100 na ’yon. So magkano na lang take-home namin sa pamilya? P168 na lang. Anong mapakain namin sa aming pamilya sa P168 lang? Tapos pasukan na sa June. [At P268 a day, we have to pay P100 for the transportation from Caticlan to Boracay. How much do we take home to our families? Just P168. How can we feed our families with

P168? Then June is approaching, it’s school opening],” he lamented. He said his members were told they could be hired to clean up Boracay and help with the demolition of properties found to be violating laws. “Sabi nila i-training kami sa Tesda sa driving, sa welding. Okay lang ‘yun basta subsidize nila pangangailangan ng pamilya namin. [They said they would train us at Tesda in driving, welding. That’s okay as long as they subsidize the needs of our families],” Casidsid stressed. Tesda is the Technical Education and Skills Development Authority, a government agency tasked to train interested

The start of the six-month shutdown of Boracay

participants in vocational work. The paraw sailor was among the 150 stakeholders who attended the government workshop conference on Tuesday at Savoy Hotel, Newcoast City, which was earlier said to be “by invitation only.” However, interested stakeholders did manage to get into the venue and took their seats to listen to government agencies roll out their plans for Boracay’s closure from April 26 to October 26. Many noted, however, that there was no effort from the government to reach out to all those impacted by the closure of Continued on A2

Traders. . .

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This means that the NFA is only capable of supplying a fourth of the country’s total rice demand for a day should it become the lone seller of the staple and the stocks held by the commercial warehouses and households are totally wiped out. Also, the source disclosed that the present stockpile held by the NFA would be totally depleted by the end of the month. Earlier, the NFA has vowed to step up its purchases of unmilled rice, but an official from the agency said it would be a tall order for the NFA to hit its procurement target for this year’s dry season harvest. The NFA said it has bought 19,361 50-kilogram (kg) bags of palay from farmers. Of this volume, 7,412 bags were bought last month, at the start of the summer crop harvest. “Rice harvest started in March, and it would peak this month. So, if the farm-gate price of palay would drop, then we could procure more palay,” the official said. “We remain optimistic that we can hit our target, but it would be quite difficult.”

Rice imports

NFA Administrator Jason Aquino on Thursday ordered the agency’s special bids and awards committee to fast-track the government’s importation of 250,000 metric tons (MT) of rice via the government-togovernment (G2G) procurement scheme to replenish the government’s nearly depleted stockpile. Aquino made the directive following President Duterte’s instruction that the NFA should “immediately” import its needed stocks to bring back cheap government rice in local markets. An official told the BusinessMirror that the NFA will invite Bangkok and Hanoi to participate in the G2G importation within the week. Thailand and Vietnam are the only countries that can participate in G2G importation as they have agreements with Manila. The official said the NFA will receive and open the offers made by Thailand and Vietnam on April 27. “If successful, the notice of award will be issued on the same day. After the submission of required perforemance bond and other documents, the issuance of notice to proceed [would be] issued by May 7.”The official said the rice imports will have to be delivered to the Philippines starting the third week of May until June 30. Of the 250,000 MT that will be imported, 250,000 MT is 25 percent brokens, while the remaining volume is 15 percent brokens.“Most likely, the DAP price for 25 percent brokens rice would be around $460 per MT, while the 15 percent brokens would be around $470 per MT.”The attached agency of the Department of Agriculture has set aside a budget for P6.1 billion for the rice imports. Under the approved terms of reference for the G2G importation, the official said the NFA would implement a delivered-at-place (DAP) system, which would require Thailand and Vietnam to deliver rice directly to NFA warehouses. Also, the DAP indicated that exporters should process and shoulder the delivery costs. The official said rice imports would be delivered to the following ports: La Union, Subic, Tabaco, Manila, Batangas, Ilo-ilo, Bacolod, Cebu, Zamboanga, Cagayan de Oro, Davao, General Santos and Surigao.

AYALA LAND STOCKHOLDERS’ MEETING Ayala Land Inc. Chairman Fernando Zobel de Ayala, President and CEO Bernard Vincent O. Dy and Vice Chairman Jaime Augusto Zobel de Ayala lead the stockholders’ meeting held on Wednesday at the grand ballroom of Fairmont Hotel in Makati City. See related story on B1. ALYSA SALEN

Czech railroad experts to solve MRT 3 woes Continued from A1

He said the robustness of Czech trains are their legacy to the Philippines, reminding us that Czech Republic “is a powerhouse in the transportation industry.” “[Despite the] size of our country, it is export oriented, that’s our strength, so obviously we would like to follow up on our sort of [unintelligible] projects here in the Philippines.” According to Ziga, the tram issue was the subject of the visit in the country of their deputy minister, Martin Tlapa. “It’s a historic visit, they meet with the Department of Transportation [DOTr] and I mentioned this is the first visit and, hopefully, it will materialize into a full project,” Ziga said. He added that there would be more follow-ups, and he hopes that the agreement would materialize for the conclusion of the signaling equipment from the Czech republic.

“We might offer potential solutions, those are the important parts that we discussed during our meeting.” On the other hand, Tlapa said that aside from trams, they are also offering to sell aviation-related equipment, radar systems and communication systems. “We have value chain of all products and services on aviation, we build planes, we build airports and we have technical men to maintain them,” he said. He said the Czech republic has “put together the aircraft industry alliance under one umbrella, which they discussed with the DOTr on Monday. “We know that the competition is high but we hope to have a chance to enter the competition and present potential solution. It’s perfectly in line with your initiative of “Build, Build, Build,” so I think the new infrastructure for transport is part of the initiative we’re trying to bring,” Tlapa said.

Tlapa said they have the means to upgrade the knowledge and training of Filipino technicians and experts in aviation-related projects, “ because we studied the locals and we offer the value of the projects, the training of people who will be maintaining the airport. It is of added value for cooperation, we share the skills and knowledge of doing things together.” “We like to join your Build, Build, Build. I would like to see more investors coming to your country because there’s a lot for exports for both sides,” he stressed. He said his country exports many things to Germany, France and the European Union and would like the Philippines to be part of their export market. He noted that the Philippines is composed of many islands and the Czech republic is ready to modernize and maintain the Philippines’s many airports, which, he said, is one of their expertise.

www.businessmirror.com.ph

Making the K-12 program work Continued from A1

of college education on the assumption that they are more mature and have higher commitment to work compared to just high-school finishers. Incidentally, unemployment among the elementary and secondary dropouts is low because these workers cannot afford to be choosy or selective about jobs compared to those with basic or tertiary education. Those without basic education diplomas constitute the bulk of the country’s underemployed, meaning workers who occupy low-level jobs with limited compensation and protection. So what can be done to make the K to 12 program work and take off? Remember, the K to 12 is an “education-reform initiative” that was rushed and instituted by the Aquino administration with limited preparation for the school system, teachers, parents and students. As pointed out in previous articles, there are no easy answers. But there are some clear doables. First, enhancing the employability of SHS students is not the sole task of those managing the K to 12 bureaucracy. The labor market has supply and demand sides. The institutions involved on both sides of the market must get involved and work together. T he sug gest ion t hat t wo weeks of “work immersion” under the K to 12 curriculum be changed into 300 to 600 hours of OJT in a real industry setting sounds good except that such proposal can only accommodate so many students. Unlike Germany, the Philippines does not have a galaxy of industries that can serve as alternative classrooms for SHS students. In most regions of the country, the economic universe is populated by solo, family, micro and small enterprises, which cannot absorb any OJT trainees nor can they allow the students to occupy limited work spaces for 300 to 600 hours. Not surprisingly, in many provinces, the work immersion destinations for SHS students have turned out to be government offices where some students are reported to have become experts in mixing coffee drinks for government bosses. Also, jobs in the services sector, which predominates, does not need long OJT hours for students to acquire the required skills and work experience. Deploying SHS students to work in fast-food chains as bus boys or girls for 600 hours with no compensation (in the name of training) opens the school system and the cooperating companies to charges of labor exploitation and even child labor, if the students are less than the legal working age of 18. The point is that there is indeed an urgent need for policy coordination among the institutions involved on the supply and demand sides of the labor market. In fact, policy coordination is one of most neglected areas of the education-demand nexus. The absence of policy coordination, especially in the areas of curriculum development and employment planning, gives rise to issues of mismatches or lack of fit between jobs and job seekers. This is why a consultative and coordinative body, such as the proposed Government-Industry-Education Council or GIEC, is a must. The GIEC should be set up at the national, regional and provincial/city levels. Industry in the GIEC should

be interpreted in a broad sense, meaning it includes not only leaders of big industry and business establishments but also representatives of the farming sector, small business, social enterprises and other actors involved in investing and g row i ng t he economy of a particular region. One job of the GIEC is to do “development mapping,” that is, map not only the economic and labor-market changes in a given regional or provincial/city economy but also the emerging and likely trends in the economy (from local to global) that are likely to affect or influence the economic/employment and education situation in the said regional/provincial/ city economy. This then can be the guide of education planners not only for those in the Department of Education [DepEd] but also for those from the Technical Education and Skills Development Authority [Tesda] and Commission on Higher Education [CHED] in their review of the curriculum, which should be increasingly geared to or aligned with the world of work. Incidentally, under the local autonomy law of 1991 and the proposed “federalization” of the government, the job of preparing the local economic development blueprint, especially employment and human-resource development plan for the local economy, is a mandated and fundamental task of local government executives and legislators. On the other hand, the education planning process will never be easy for it entails a holistic approach and a better grasp of the economic and employment situation. As pointed out by the authors of K to 12 education reform and the harmonized “trifocalization” of the education system involving the DepEd, Tesda and CHED education leaders should be able to develop a continuous and seamless pathway of learning that enables young people to move from secondary to higher education and vocational training while accumulating skills and work experiences throughout their lives. Part of the learning pathway is opportunity for entrepreneurship, which is very much needed in the farming sector and underdeveloped regions of the country. Also part of the education planning is the challenge of how to provide career guidance, labormarket information and counselling to SHS students. How many high-school graduates leave the portals of the school without any idea of where to go after schooling? How many graduate who cannot even distinguish the difference between an “AB” and “BS” let alone “MA” or “MS” degrees? How many high-school graduates leave the school system with a deeper appreciation of how their local economy looks like and what are the job prospects for them? In all of this, policy coordination, made possible through continuous consultation and dialogue among the social partners, is crucial. Hence, the importance of the GIEC. The dialogue-coordination process can become the platform in determining how education and skills development can become responsive to the changing needs of the national and local economy, as well as life aspirations of the young work force. This platform of dialogue can also guide the experts in making skills certifications and in developing the standards under the Philippine qualifications framework that has been enacted into a law early this year.