Businessmirror april 26, 2017

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PHL explores paths to modern defense By Rene Acosta

@reneacostaBM

Conclusion

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HE prevailing trend of increased defense spending in Southeast Asia, which has even outpaced Europe, has been linked to China’s “provocative” rise as a military superpower, and what its neighbors viewed as its “irresponsible” behavior in the South China Sea. China even disputed, through its 9-dash map, territories and claims by countries like Brunei Darussalam, Malaysia, Vietnam and even Taiwan. While these countries saw the need to defend their respective stake on the South China Sea, other regional states were also worried, if not threatened, by Beijing’s muscle flexing and assertiveness in pursuing its claims. Beijing’s overzealousness in pushing for its stakes, at times, even led it to encroach deep into the territories Continued on A2

a parade of colors by members of the Armed Forces of the Philippines in Villamor Airbase, Pasay City, is shown in this file photo. President Duterte’s realistic assessment that the country will never win militarily against Beijing apparently influenced the administration’s decision to scale back the modernization procurement by going for smaller assets. NONIE REYES

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Wednesday, April 26, 2017 Vol. 12 No. 195

Travel firms, DOT chief ask hotels to lower rates $114 T By Ma. Stella F. Arnaldo

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Philippine statement at the UN Alliance of Civilizations Group of Friends meeting

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HE country’s oldest and most respected tour operator is appealing to local hotels, especially those in Bohol and Cebu, to cut their rates.

A le ja nd ra C lemente, c h a i r man of Rajah Tours Philippines, made this appeal after foreign tourists canceled their trips to the two provinces, after advisories were issued by several foreign

g o v e r n m e nt s w a r n i n g a b o u t traveling to the Philippines, especially to Central Visayas. “You know, two months after the Aquino assassination [when no tourists wanted to come here],

The average daily rate of hotels in the Philippines Philippine Airlines and the hotels dropped their rates. This was how we got back the tourists,” she said. The problem is, she noted, hotels no longer want to do that, especially since summer is considered a peak season for tourists. See “Travel firms,” A12

Teddy Locsin Jr.

free fire Remarks of HE Teodoro L. Locsin Jr., Philippine Permanent Representative to the United Nations Mr. High Representative, Excellencies, Toynbee argued that civilizations live and thrive—or die by challenges: A challenge can inspire the challenged to rise above itself and be something more by interaction. Continued on A11

FOREIGN FIRMS EXPRESS DA sees higher onion yield as top INTEREST TO OPERATE producer recovers from infestation BATAAN NUCLEAR PLANT By Lenie Lectura

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he Philippines is getting offers from foreign groups to operate the Bataan Nuclear Power Plant (BNPP), including a Chinese firm that is ready to assess the mothballed facility, Energy Secretary Alfonso G. Cusi said. Cusi declined to name the Chinese company, but said there are already discussions with Beijing on the matter. Cusi said the “Chinese company engaged in nuclear” wants to “assess” the country’s potential to produce nuclear power. In particular, it cited the 31-year-old BNPP. “In fact, they are interested even to operate [BNPP],” Cusi added. The energy chief said this is the kind of offer that he wants to receive from other countries. “I’m looking at other countries to do it, operate it. Instead of giving us grant, this is what they should do. I already talked to the Chinese ambassador to have it assessed,” said Cusi, adding that “other countries are also interested”. The 620-megawatt (MW) BNPP

is the country’s first and only attempt at nuclear-power development. It was supposed to be the first of two nuclear plants to be built in the northern province of Bataan. It was also the first nuclear power plant in Southeast Asia, and was identified as a solution to the 1973 oil crisis that had adversely affected the global economy, including that of the Philippines. The project, however, was mothballed in the wake of the Chernobyl disaster in 1986. But clamor for the reopening of the BNPP was revived during the power crisis in the 1990s, as well as when oil prices were skyrocketing in 2007. During these periods, Cusi said, the Department of Energy (DOE) actually came close to reconsidering nuclear power as a potential energy source for the country. But then, the Fukushima nuclear-plant incident happened in 2011, creating global panic and concerns about the safety and integrity of nuclear plants. During the recently concluded Sevnth Annual Meeting of the Nuclear Energy Cooperation Subsector Network, a prefeasibility study See “Foreign firms,” A2

PESO exchange rates n US 49.8040

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entral Luzon, the top producer of onion in the country, is expected to more than double its output of the crop this year, according to an official of the Department of Agriculture (DA). DA Region 3 Officer in ChargeDirector Roy M. Abaya said Central Luzon has recovered from the devastation caused by the armyworm infestation last year. This allowed harvestable area to expand to 11,000 hectares this year. “Production this cropping season is much better, much bigger compared to last year. Last year’s output was greatly slashed by armyworm infestation, which affected 5,000 hectares,” Abaya told the BusinessMirror. “So, now only less than 500 hectares planted with onion are affected by armyworms. The DA expects harvestable area to reach 11,000 hectares, with yield averaging 12 to 14 metric tons (MT) per hectare,” he added. Based on the BusinessMirror’s computation, onion in Central Lu-

122,600 MT The total volume of onions produced by the Philippines in 2016 zon could reach 132,000 MT this year, higher than the 59,817 MT recorded last year. Last year the BusinessMirror reported that onion farms in Nueva Ecija contracted to 9,000 hectares, from 13,000 hectares in 2015, due to strong typhoons. Onion planting in Central Luzon starts in September and ends in December. Harvest starts as early as December and ends in April of the succeeding year. Data from the Philippine Statistics Authority (PSA) showed the country’s onion production in the first half of 2016 reached 87,266 MT. More than half, or 68.54 percent, of the total output came from Central Luzon. Central Luzon’s onion output in the first half of 2016 reached 59,817 MT, 53.02 percent lower than the 112,827 MT recorded in

the same period in 2015. In the first and second quarters of 2016, Central Luzon produced 34,488 MT and 12,677 MT, respectively. The region’s output last year was nowhere near its 2015 production of 83,688 MT in the first quarter and 29,139 in the second quarter. The PSA attributed this to damages caused by strong typhoons and armyworm infestation during the 2015 and 2016 planting season. The Philippines produced a total of 122,600 MT of onions last year, 32.34 percent lower than the 181,210 MT recorded in 2015. Central Luzon usually accounts for half of the country’s onion production. Bureau of Plant Industry (BPI) National Plant Quarantine Services Division Assistant Chief Joselito Antioquia said the agency is still assessing the volume of local

harvest to determine if there is a need to import onion. “There has been no importation of onions so far this year. There’s a huge harvest of red onions this cropping season,” Antioquia told the BusinessMirror. BPI-South Harbor Station 4 OIC Ardy Cusio said there’s no immediate need yet for importation, as the country’s current redonion supply is sufficient to meet local demand. “For now, we have sufficient supply of red local onion in the market, as well as in cold storages in different regions. Harvesting is still ongoing in onion-producing areas, like Nueva Ecija, Pangasinan and Mindoro,” Cushio, who is also the BPI’s focal person on onion, told the BusinessMirror. The DA allows the private sector to import onions whenever there is a shortfall in local production. Last year the BPI, an attached agency of the DA, allowed the importation of as much as 16,5000 MT of white onions. As of December 2 government data showed that private traders brought into the country 28,442.75 MT of yellow onions and 23,951.80 MT of red onions.

n japan 0.4538 n UK 63.7242 n HK 6.4026 n CHINA 7.2341 n singapore 35.7684 n australia 37.6817 n EU 54.1270 n SAUDI arabia 13.2818

Source: BSP (25 April 2017 )

A2 Wednesday, April 26, 2017

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PHL explores paths to modern defense Continued from A1

of the Asean members, like Vietnam, the Philippines and Malaysia. Even Indonesia’s Natuna Island has seen deliberate entries and presence of Chinese warships in the past. Defense analysts in the region, all agreed that the military allocations and spending by many Asean member-countries were basically influenced by China’s direction and assertive actions. The huge budget flowing across the region prodded the world’s biggest defense contractors to turn their eyes to Southeast Asia.

China, a threat

MANILA has labeled Beijing as a security threat. The administration under President Benigno S. Aquino III has tagged China as the single foreign threat to the country, citing Beijing’s policy demeanor characterized by a de facto occupation of the Scarborough Shoal. The Aquino administration also noted China’s constant harassments of resupplies to Filipino soldiers guarding the Ayungin Shoal, as well as its regular challenges of flights near

reefs in the West Philippine Sea that Chinese troops have occupied. No less than Voltaire T. Gazmin, the then defense secretary, who declared that China poses the most imminent threat to the country’s security, owing to its deliberate and nonstop development of the reefs, which it turned into military fortresses. As early as 2015, then-Armed Forces of the Philippines chief of staff Gen. Gregorio Pio Catapang had already warned of the “indescribable” effects of Chinese activities in the South China Sea/West Philippine Sea, citing as example the ongoing construction of an airfield at that time. Catapang has said the Chinese airfield will permanently alter the Philippine security landscape by directly putting the country within China’s striking distance, other than choking or cutting Manila’s access to its occupied territories, including Pagasa Island. China could also derail or even stop supplies to troops guarding Ayungin Shoal, which later became the habit for Chinese military and paramilitary ships. “We feel we are in a very difficult situation now because they are re-

claiming the Mischief Reef,” Catapang candidly admitted that time. “So if they reclaim the Mischief Reef, we will be cut off. We have a series of islands going down south, going up north and it will challenge the Ayungin shoal.” Beijing also occupies K agitingan, Mabini, Chigua, Cuarteron, Burgos, Subi and Gaven Reefs, most of which, like Mischief, have been militarily redeveloped to accommodate warships and bigger aircraft. Elaborate gun placements were also made. In its Annual Report to Congress, the US Department of Defense (DOD) accused China of having added “more than 3,200 acres of land to the seven features it occupies in the archipelago” in late 2015.

‘Credible posture’

THE so-called Chinese threat and what the Aquino government described as constant harassment and bullying by Beijing of both military resupplies and Filipino fishermen, prompted the hastening of the modernization of the military. Gazmin has said that, while the state renounces war as a national policy, it also has the duty and

obligation to defend the country’s sovereignty and national integrity when it is directly challenged, regardless of the outcome. Otherwise, it ceases to exist as a state, he explained. Gazmin has also said that, with the state of the Philippine military, the country may unlikely win against Beijing. Nonetheless, the country’s armed forces, he explained, must put up a credible defense posture. Gazmin said this is the “patriotic” thing to do for the Armed Forces of the Philippines (AFP).

Chief’s friend

WHILE China’s official standing in the national security listing of the Duterte administration is still unclear, the President sees and even considered Beijing as a friend, and not a foe, judging from the Commander in Chief’s constant pronouncements. The fact that Duterte has turned to the Chinese government to equip Filipino soldiers is a testament to his fondness for China. This stance is despite the unsettled West Philippine Sea ruling by a UN court, which the Commander in Chief also continuously relegate to the sidelines.

Duterte even took the cudgels for Beijing’s recent incursions in the Benham Rise, saying he has approved it. However, neither his defense executives nor foreign affairs officials knew about such incursions. It was China and its issues that oftentimes transform Duterte into an erratic and irresolute Commander in Chief. Just recently, the President said he would go to Pagasa Island on Independence Day to plant the country’s tricolor there. He later backtracked on this vow while on official visit abroad. The Commander in Chief has maintained he would never go to war with China, as the Philippines would never stand a chance against Beijing’s military might. The US DOD report of 2016 has said “China’s officially disclosed military budget grew at an average of 9.8 percent per year in inflation-adjusted terms from 2006 through 2015.” “And Chinese leaders seem committed to sustaining defense spending growth for the foreseeable future, even as China’s economic growth decelerates,” the DOD report, released for the

SC allows Consunji condo blocking Rizal statue iconic sight line

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FTER two years of delay, the Consunji-owned DMCI Project Developer Inc. (PDI) can now continue with the construction of its controversial 49-story residential condominium project Torre de Manila. This was after the Supreme Court (SC) dismissed the petition filed by the Knights of Rizal (KOR) seeking the demolition of the building for ruining the iconic sight line of the century-old monument of national hero Jose Rizal in Luneta Park. In a vote of 9-6, the Court also lifted the temporary restraining order (TRO) it issued in June 2015 that stopped the project. The Court’s decision was announced by SC Spokesman Theodore Te following the magistrate en banc session in Baguio City. In junking the petition for mandamus filed by the KOR, the SC agreed with the DMCI that the “photobombing” issue raised

against the P2.7-billion Torre de Manila has no legal basis in law. “Furthermore, the Court also found that there is no law that prohibits the construction of the challenged Torre de Manila,” Te said. “As a consequence of the judgment rendered today, the TRO issued by the Court is lifted.” Furthermore, the Court dismissed the petition citing lack of jurisdiction over the case. It added that KOR lacks the legal standing to sue and that it failed to prove that they stand to suffer injury if the project is not abandoned. The decision was penned by Senior Associate Justice Antonio T. Carpio. Concurring were Chief Justice Ma. Lourdes P.A. Sereno, Associate Justices Presbitero J. Velasco Jr., Lucas P. Bersamin, Mariano C. del Castillo, Bienvenido L. Reyes, Estela M. Perlas-Bernabe, Marvic M.V.F. Leonen and Noel G. Tijam. Dissenting are Associate Jus-

tices Teresita J. Leonardo-de Castro, Diosdado M. Peralta, Jose C. Mendoza and Alfredo Benjamin S. Caguioa and Samuel R. Martires. For his part, Associate Justice Francis H. Jardeleza filed separate dissenting opinion.

Legal provisions

THE KOR asked the court in September 2014 to order the demolition of the project citing the condominium defaced the visual corridors of the Rizal Monument. The group accused DMCI of having violated several laws mandating the protection and preservation of the shrine for the national hero that was unveiled on December 30, 1913. These laws include Republic Act 4846 (Cultural Properties Preservation and Protection Act), Republic Act 7356 (law creating the National Commission on Culture and the Arts) and Republic Act 10066 (National Cultural

Heritage Act of 2009, or an Act Providing for the Protection and Conservation of the National Cultural Heritage). The petitioners also argued that the project could be considered as an act of nuisance as defined under the Civil Code of the Philippines. The DMCI earlier branded KOR’s petition “high on political drama but short on the facts and the law.” It noted that there is no provision in RA 10066, RA 4846 and RA 7356 that protects the background or backdrop of any historical or cultural property. The DMCI said KOR’s claim that Torre de Manila offends the senses of every Filipino who honors the memory of national hero Jose Rizal does not bring it within the legal definition of a nuisance per se. Furthermore, the DMCI-PDI said the fact that Torre de Manila was given the necessary permits and exemption confirms that

it is not a nuisance. It noted that several high rises and buildings surround most of the monuments in Metro Manila and other parts of the country.

Knights bow

IN a statement, the Order of the Knights of Rizal said they respect the High Tribunal’s decision on the Torre de Manila issue. “We thank the public for carrying this issue with us and for making the same as a test case for Philippine Heritage for whatever the outcome would have been,” the group’s statement on April 25 said. “The public support that was expressed in favor of our stand was an indication not only of the importance of the National Monument but also to the continued relevance and reverence our National Hero, Jose Rizal, still enjoys.” Meanwhile, DMCI said it is “moving on” and vows to “immediately resume construction” of the condominium project. The company said in a statement it “will immediately advise its customers and future residents on the updated construction timeline since the initial target completion date has been critically affected” by the TRO. Joel R. San Juan

Exports. . .

Continued from A12

Also, the acceleration of inflation is seen to have a “minimal” impact on the country’s growth not only in the first quarter but also the entire first semester. FMIC-UA&P Capital Markets Research said inflation could “hover around the median range” of 3 percent to around 3.5 percent in the January-to-June period. “Upward pressures”, such as higher food prices due to rains and floods experienced in key production areas and oil prices, are not expected to have much impact on inflation in the first half. “The Monetary Board will likely keep policy rates unchanged in the first semester. It may, however, raise it soon after the Fed decides to hike its policy rates for the second time in 2017,” the report read. Based on its Asian Development Outlook report, the Asian Development Bank said Philippine GDP could grow by 6.4 percent this year and 6.6 percent in 2018. The World Bank had a more sanguine outlook as it projected that the country’s GDP growth would hit 6.9 percent in 2017 and 2018, and 6.8 percent in 2019.

request of budget from the US Congress, said. To note, Duterte has said the Philippines cannot do anything against China’s wishes in the West Philippine Sea, as the US has even failed to restrain Beijing in its development activities there. Duterte’s soft spot for China, which he sees a friend and a benefactor for the country, and his realistic assessment that the country will never win militarily against Beijing, apparently influenced the administration’s decision to scale back the modernization procurement by going for smaller assets. As a middle ground, though, he has just ordered the military to occupy the still uninhabited islets and reefs in the West Philippine Sea, before “they could even be occupied” by others. Defense and military officials, however, said the Philippines has already occupied all the features that it claims in the West Philippine Sea, except those that are already under Chinese control. For Duterte, the West Philippine Sea is just a “battle of occupation” or who gets first into which feature. The problem is, the Philippines’s pocket is not as deep as its rival.

Foreign firms. . . Continued from A1

unveiled that many Asean member-countries are in favor of tapping nuclear energy for peaceful or commercial use. The threeday summit was hosted by the Philippines, with the DOE as the lead agency. Nuclear energy is being seen by Asean members as a long-term source of power, according to the study conducted by the Asean Center for Energy and Asean-Canada Nuclear and Radiological Program. Energy Undersecretary Jess Posadas underscored the need for regional and international cooperation to advance the use of civilian nuclear energy in the Asean region. “The meeting was timely, as it afforded the Philippines insights while it tries to develop and formulate its national position on nuclear energy,” Posadas said. Posadas added that the Philippines will need a kind of energy that will power the economic development resulting from the P8.9 trillion worth of investments in infrastructure in the next five years. Nuclear power has the potential of meeting such huge energy demand, according to Posadas, as he noted that 1 gram of uranium is equivalent to 1.8 million cubic meters of oil and 3 million grams of coal. “Nuclear energy would last longer than other fuels,” Posadas said. “The Philippines has always viewed nuclear energy as a long-term option for power generation that will provide supply security, stability and reliability. Should this be the path that the country will take, nuclear further diversifies our existing generation mix comprised of coal, natural gas, geothermal, hydropower, oil, wind, biomass and solar,” he said.

Agri sector. . . Continued from A12

“Pagasa, through this development partnership with FAO Philippines, has shown that weather and climate information and products can be mainstreamed and localized with the support of LGUs, national and regional government agencies and academic institutions," Pagasa Administrator Vicente Malano said. “The FAO has also appreciated Pagasa for issuing quick and timely early warnings, especially for populations such as upland farmers and indigenous people who live in vulnerable ecosystems highly susceptible to heavy rains and flooding," Malano added. In the case of aquaculture producers, the FAO said it provided funding and technical support to the Bureau of Fisheries and Aquatic Resources (BFAR) “to enhance the resilience of the aquaculture sector”. “Several climate information products and manuals on the impact management of weathers systems have been developed to support the production of at least 11 aquaculture commodities. This covers, among others, cage and pond cultured tilapia, milkfish, grouper, seaweed, shellfish, shrimp and crab,” it said.

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Comelec braces for late registrants as barangay, SK elections near

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HE Commission on Elections (Comelec) is ready for lastminute applications for registration for the barangay and Sangguniang Kabataan (SK) elections set on October 23. With this, Comelec Chairman Juan Andres D. Bautista said the poll body expects many people to troop to the Offices of Election Officers (OEOs) nationwide in the last three days of the registration period, which is set to end on April 29. “That is really our usual problem. We already know that there will be many last-minute applicants,” he added. At the same time, Bautista called on the public not to wait for the last day of the registration to avoid long queues.
“Please let us not wait for the last minute on the last day before registering,” he appealed to prospective voters. The registration period for the village and youth elections started on November 7, 2016, and will last until April 29, 2017. Latest data from the Comelec showed it has already received 2,174,601 applications for registration.

Bautista said the poll body expects the figure to go up, because of those who will register in the last days of the registration period. “I think that we’re happy with the 2.1 million but we still expect the number going up, because of the last-minute applicants,” he added. Meanwhile, personnel of the Comelec’s Education and Information Department (EID) will be visiting several OEOs in the country to check on voter-registration activities. “It is critical that the commission tries to amplify and disseminate the motivation of people, who are in line for voter registration, so as to encourage those that haven’t registered yet,” EID Director James Jimenez said in a statement. Among the registration centers that are scheduled to be visited are OEOs of San Pascual, Bauan and Batangas City in Batangas on Wednesday; OEO of Taguig City and the People’s Center City Hall in Muntinlupa City on Thursday; and some cities in Pangasinan on Friday. PNA

Editor: Dionisio L. Pelayo • Wednesday, April 26, 2017 A3

Luisita farmers tear down walls, fences in land sold to bank

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By Marvyn N. Benaning | Correspondent

ARLAC CITY—More than 1,000 Hacienda Luisita farmers, agrarian-reform beneficiaries and supporters took over portions of fenced farmland in Barangay Balete here on Monday.

The action coincided with the fifth anniversary of the Supreme Court’s final and executory decision to distribute the 6,453 hectares of the sprawling sugar estate to farmer-beneficiaries. Farmers marched to Barangay Balete in the morning and started to break down the fortified concrete barriers of the bank property that they claimed “was illegally converted and sold by the

Cojuangco-Aquinos’ Tarlac Development Corp. after the Hacienda Luisita massacre in 2004”. The action was part of the bungkalan, or collective cultivation of the farmers, who previously tilled the area before the bank fenced off the property in 2013. “This is just the start of our actions to reclaim our farmland. We have demolished the walls—the symbol of the Cojuangco-Aquinos’

land grabbing and terror in Luisita,” said Rudy Corpuz, secretary of the Alyansa ng mga Magbubukid sa Asyenda Luisita. The Kalipunan ng Damayang Mahihirap (Kadamay) also supported the action of the Hacienda Luisita farmworkers. “Kadamay expresses its full support to the OccupyLuisita movement, as it echoes our own call for the government to own up to its sins and finally begin to give to people what is due them,” Kadamay Chairman Gloria Arellano said. Arellano added that “around 1,000 hectares of land remain untilled and, therefore, unproductive, simply because the landlords and the government hold on to their spoils rather than fulfill their duties to the people. Just like the idle housing units, the ruling class would rather see homes and land go unused rather than be owned or made productive by the broad masses of the Filipino people.”

“For decades, we were barred from entering our farmlands. Private security guards of the bank destroyed our crops and harassed our leaders and members. The Department of Agrarian Reform, under former Secretary Virgilio de los Reyes, implemented the bogus tambiolo land-reform raffle. The Lorenzos of Mindanao invested in Central Azucarera de Tarlac and continue to exploit sugar mill workers and sacadas. We are fighting back again. It is our right and duty to defend our right to the land and reclaim what is rightfully ours,” Corpuz said. The #OccupyLuisita activity is part of a series of land occupation and land-cultivation activities nationwide in the escalating agrarian struggles asserting genuine land reform. #OccupyLuisita is supported by militant organizations led by Kilusang Magbubukid ng Pilipinas, Unyon ng Manggagawa sa Agrikultura and the Bagong Alyansang Makabayan.

Deadline for 67th Palanca Korean awaiting deportation had 7 bouncing checks cases Awards entries: April 30 A T HE deadline for joining the 67th Carlos Palanca Memorial Awards for Literature is fast approaching. At midnight of April 30, the Carlos Palanca Foundation Inc., its sponsor and organizer, will close submission to the country’s longest running and most prestigious literary competition. Participants may submit only one entry per category. This year’s Palanca Awards is accepting entries for all 22 categories: English Division—Short Story, Short Story for Children, Essay, Poetry, Poetry Written for Children, One-act Play and Full-length Play; Filipino Division—Maikling Kuwento, Maikling Kuwentong Pambata, Sanaysay, Tula, Tulang Para sa mga Bata, Dulang May Isang Yugto, Dulang Ganap ang Haba and Dulang Pampelikula; Regional Languages Division—Short StoryCebuano, Short Story-Hiligaynon and Short Story-Ilokano. Published/produced works which were first published or first produced between May 1, 2016, to April 30, 2017, and/or unpublished/

unproduced works may be entered in the contest. Only unproduced works may be entered in the Dulang Pampelikula category. This year the Kabataan Division for young writers 17 and below begs the question “How can the youth contribute to building interest in Philippine culture and literature?” (Kabataan Essay) and “Paano makaaambag ang mga kabataan sa pagsulong ng interes sa kultura at panitikang Pilipino?” (Kabataan Sanaysay). Completing the lineup are the Novel and Nobela categories open this contest year. These categories accept unpublished and published works, provided they were first published within a period of two years prior to April 30, 2017. Entries may be submitted at any of the Palanca Foundation offices at Unit 603, Sixth Floor Park Trade Centre Building, 1716 Investment Drive, Madrigal Business Park, Ayala Alabang, Muntinlupa City, or at Unit 3G, OPL Building, 100 Carlos Palanca Street, Legaspi Village, Makati City, or through the CPMA web site at www. palancaawards.com.ph.

SIDE from his two convictions for violation of the AntiBouncing Checks Law or Batas Pambansa 22, Korean businessman Kang Tae Sik, whom Justice Secretary Vitaliano N. Aguirre II wanted to deport immediately, had faced a total of seven separate criminal charges for the same offense. This was disclosed by lawyer Alex A. Tan, the private complainant who filed a deportation case against Kang Tae Sik in March 2014. Another affidavit complaint against the Korean was executed by a certain Bonifacio Carreon in April 2014, who named Kang as among “foreign nationals in cahoots with Filipino dummies” who were violating the antidummy law. Lawyer Jorico F. Bayaua referred Carreon’s complaint to then-NBI Director Virgilio L. Mendez who brought the case to the attention of the Bureau of Immigration. Tan said two of the seven charges were filed in a Regional Trial Court (RTC) in Manila, one in the Municipal Trial Court (MTC) in Pasig City, three in different MTCs in Makati and the seventh in the RTC in Makati. While Kang Tae Sik managed to wiggle out of five of these cases, the RTC in Manila convicted him in Jan-

FVR: Philippines can still work its way up

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ITH teamwork, the Philippines can still work its way up the top 20 or even higher,” former President Fidel V. Ramos said in his message during the launching of the book titled RPDEV @ 15: Our Continuing Voyage For Enduring Peace And Sustainable Development. The book was launched in time for the celebration of the 15 years of the Ramos Peace and Development Foundation Inc. (RPDEV). Written by Melandrew T. Velasco, the new RPDEV commemorative book was launched by Ramos at the Metropolitan Waterworks and Sewage System (MWSS) in Quezon City on Friday last week. Stressing that the Philippines was in the upper half for more than 25 years compared to its present ranking at 116th out of the 190 countries in the UN’s Human Development Index, Ramos said the country can still “soar higher through unity, solidarity and teamwork, as well as caring, sharing and daring for one another.” “With our numbers, our talents, with our geopolitical position in the middle of the two super powers of the world, the Philippines can work its way to the top,” Ramos said. “We have shown this through three different shining periods of our history—Spirit of 1896 at Pugad Lawin, the Patriotic Spirit of 1942 at Bataan and the People Power Revolu-

RECENTLY appointed Manila Water Corp. President Ferdinand de la Cruz do the fist sign with former President Fidel V. Ramos and publisher-author Melandrew T. Velasco, following the autograph signing of RPDEV @ 15: Our Continuing Voyage for Enduring Peace and Sustainable Development on Friday at the Metropolitan Waterworks and Sewerage System main office in Quezon City.

tion of 1986,” Ramos said. Author Velasco said of Ramos, “To our dear former President Fidel Valdez Ramos, thank you sir for your continuing trust, confidence, guidance over the last 17 years to me and for sharing us your inspiring life and for continuing to serve our country through RPDEV, ably showing all of us na ‘Kaya Natin Ito!’ in spite of the many challenges we face daily.”

For his part, MWSS Administrator Reynaldo Velasco, who hosted the event, said, “As I scanned the pages of this new book, I am grateful to RPDEV and MTVi for including MWSS and the water sector in this new book. This a must read legacy book for all past, present, future leaders in both government and private sectors, academe, scholars and students since it speaks volumes on good governance and best practices.”

uary 1996 of two counts of issuing bouncing checks. The conviction earned him a total of one year and eight months in jail, apart from shouldering the cost of litigation and attorney’s fees. He was also ordered to pay the P500,000 representing the value of the bouncing checks, plus 12-percent annual inter-

est from the date of conviction until fully paid. Since the offenses involved moral turpitude, the conviction made him liable for deportation. Kang subsequently sought the reversal of the RTC in Manila’s decision before the Court of Appeals, first in 1997 and then in 2001. He lost in both instances. He later brought his case to

the Supreme Court, which also denied his appeal and upheld his conviction in 2003. Tan said the seven criminal charges of violations of Batas Pambansa 22 constitute solid proof of Kang’s antisocial behavior and makes him a recidivist whose continued stay in the country is highly inimical to public interest. Joel R. San Juan

Economy BusinessMirror

A4 Wednesday, April 26, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

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Mining groups to Lopez: Provide more details on area devt, biochar program implementation By Jonathan L. Mayuga

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hile Environment Secretary Regina Paz L. Lopez has shown much enthusiasm in implementing her so-called areadevelopment approach and biochar livelihood program, mining companies appear to be oblivious about it. Ronald Recidoro, vice president for policy and planning of the Chamber of Mines of the Philippines (COMP), which represents the mining industry’s big players, for one, said mining companies have not seen the program’s “blue print” and how the Department of Environment and Natural Resources (DENR) plans to implement the program in mining communities. “There are a few mining companies that entered into an agreement with [the] DENR, but most are still unaware of the specifics,” he told the BusinessMirror in a telephone interview. The DENR is aggressively promoting its concept of area development through the sustainable integrated area development (SIAD) and biochar program as part of its thrust to turn the DENR from a mere regulatory into a development agency. Lopez, an environmental advocate who has ordered the closure or suspension of 28 operating mines so far as a result of a mining audit last year and cancellation of 75 mining contracts to protect watersheds, wants the agency to shift from a mere regulatory agency to a development-oriented one under her watch. Recidoro said COMP membercompanies and even players outside the group are not aware of the specifics as to mining companies' would-be roles. He said mining companies are willing to see Lopez’s plan

DAO 2017-02 The DENR administrative order that calls for the formulation and implementation of a sixyear SIAD action plan by the government, civil society and the private sector, and DAO 2017-05 laid down the guidelines on the implementation of the biochar program, an initiative that uses the SIAD approach in black and white for them to appreciate the shift. “We’ve only heard about it from Secretary Lopez through the media. But we really still don’t know how it will help mining or the people in mining communities,” he said. Likewise, he said the DENR chief’s plan to apply the biochar technology should be discussed thoroughly with mining companies. “What I know about charcoalmaking is it is produced by burning. So are we burning materials now to make charcoal? What’s the technology? Who is going to make biochar?” Recidoro said. “Even if it works, it should not be monopolized in such a way that it will benefit one company

or group,” he added. Environmental groups under the Kalikasan-People’s Network for the Environment (Kalikasan-PNE) group are also unaware of the details of SIAD or biochar. Clemente Bautista, national coordinator of Kalikasan-PNE said their group will request for an audience with Lopez to know more about SIAD and biochar. They said they need to know more as to how it will help boost the livelihood of rural folks, particularly in miningaffected areas. “I’ve heard about it from Secretary Gina, but I still do not know the details of the program. Maybe we need to know more about it first,” Bautista said. Kalikasan-PNE supports Lopez’s antimining stance and her proenvironment policy, such as the dismantling of fish cages in Laguna de Bay. The group also supports Lopez’s idea of promoting social justice by giving premium to environmental protection and conservation, while promoting the welfare of the communities who seldom benefit while being at the losing end of destructive development projects. The antimining group, Alyansa Tigil Mina (ATM), meanwhile, welcomes Lopez’s plan to implement SIAD. Jaybee Garganera, national coordinator of ATM, said it is an “innovative approach” and is welcomed by many civil-society organizations (CSOs) and even local government. “My impression is that there is a positive synergy and positive reaction from the departments of Health, Agriculture, Social Welfare and Development and even Education working together in specific geographic sites,” he said. Garganera said he knows of the general framework of SIAD wherein the DENR will download programs in selected and specific sites, with the community and even local government units having broader and direct participation in managing their natural resources. “This is very participatory. Even agencies outside [the] DENR wel-

come this approach,” he said. According to Garganera, SIAD is popular among CSOs. Garganera said he became familiar with SIAD because of his previous engagement with the Philippine Partnership for Development of Human Resources in Rural Areas, which implemented it as a main strategy for development from 2001 to 2006. “That is why when Secretary Lopez mentioned about SIAD, I know what she’s talking about,” Garganera said. However, he said he is still unaware of the details of how the DENR chief plans to execute SIAD. “We plan to seek an audience with her about it to learn more,” Garganera added. In an interview with Lopez during her interaction with miningaffected communities in Mogpog and Santa Cruz town in Marinduque on Monday, Lopez said area development simply means the people will be given jobs, livelihood and benefit from the natural resources, which they will protect and conserve. Lopez said in rehabilitating abandoned or mined-out areas, biochar will be used by the DENR under her watch, but expressed concern that without former DENR Undercretary for Field Operations Philipp Camara, may prove to be a tough job. “Only Philipp knows how to make biochar work. The DENR doesn’t know anything about biochar,” Lopez said. Camara’s appointment was rejected by the Civil Service Commission and a protest launched by DENR employees forced Camara to quit his bid for the position. Lopez said she intends to talk to Camara to convince him to help the DENR in his capacity as a private individual. Last month the DENR issued policy guidelines for the two major programs—the SIAD and biochar programs—which it says were “designed to provide communities with sustainable livelihood opportunities while protecting the environment”. Department Administrative Or-

der (DAO) 2017-02 calls for the formulation and implementation of a six-year SIAD action plan by the government, civil society and the private sector, and DAO 2017-05 laid down the guidelines on the implementation of the biochar program, an initiative that uses the SIAD approach. Lopez said the SIAD strategy aims to apply area-based interventions, concepts on its natural resources development programs including the Enhanced National Greening Program and integrated island development. SIAD will cover, but is not limited to, river basins and watersheds, and will be initially implemented within 29 priority sites and expansion areas identified by the DENR last year. SIAD shall also be implemented in other areas of the Philippines, Lopez said. Meanwhile the biochar program calls for the efficient utilization of abundant agricultural waste materials into marketable products created by rural communities for green energy, soil enhancement, mine revegetation, and a host of environmental products and services, making it a remarkable climatechange mitigation technology with a poverty alleviation through community enterprise. Biochar is charred biomass strictly from agricultural wastes like rice hull and straw, bagasse, pili shell, mango seed, coconut husk and shell and corn cobs, which are produced by high heating (>500 degrees Celsius) with very limited oxygen. Lopez said biochar has 52 known uses, including as feed additive in animal farming, carbon fertilizer, insulator, protection against electromagnetic radiation, water decontaminant, biomass additive, ingredient in cataplasm for insect bites and abscesses, fabric additive for functional underwear and filling for mattresses and pillows. Biochar also draws carbon from the atmosphere, providing a carbon sink on agricultural lands. After its initial or cascading use, biochar can be recycled as soil conditioner.

BOI bares 31% jump in investment pledges from Jan to April period

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he Board of Investments (BOI) on Tuesday reported a 31-percent growth in investment pledges from January to April, with the P48.5-billion Cavite-Laguna Expressway (Calax) registering as the biggest project approved within the period. BOI Managing Head and Trade Undersecretary for Industry Policy and Trade Development Ceferino S. Rodolfo announced that investment pledges had reached P153.9 billion, compared to P117 billion from the same period last year. “From January 1 to April 25, the value of projects reached P153.9 billion. This is equivalent to generated employment of 46,018 once operational compared to 16,366 employment from the same period last year,” Rodolfo said during the call for nominations for the BOI’s Guinogulan Awards on Tuesday. Rodolfo also indicated that two more projects may see approval within the week, with a total cost of P6.5 billion. The 46,018 foreseen employment is a 181-percent improvement over last year’s employment count in the same four-month period. The BOI is sticking to its P500-billion target by year-end, in line with the agency’s “BOI@50” anniversary theme this year. According to Rodolfo, the most significant project this year is MPCALA Holdings Inc.’s P 48.5-billion Calax project. The top sectors that boosted the January to April pledges are in infrastructure, power (renewable energy, mostly solar and biomass), manufacturing and housing. For manufacturing, a priority of the trade department via the Manufacturing Resurgence Program contributed P14.4 billion to the total on the account of projects in chemicals, processed food, basic metals and rubber and plastic manufacturing. The infrastructure project qualified under the public-private partnership (PPP) initiative under the Preferred Activities of the current Investment Priorities Plan include the Calax project, which is one of the listed priority projects under the PPP being implemented by the Department of Public Works and Highways. Catherine N. Pillas

PHL is fourth-biggest ADB borrower in ’16 LRTA to issue ‘late for work’ certificates to T commuters By Cai U. Ordinario @cuo_bm

he Philippines is the Asian Development Bank’s (ADB) fourth-largest borrower in 2016, according to a report released by the Manila-based lender on Tuesday. Based on the ADB’s Annual Report, total sovereign loans extended to the country reached $5.935 billion in 2016, some 7.42 percent higher than the $5.525 billion in 2015. The ADB’s sovereign lending to the Philippines accounted for 9.4 percent of the $62.983 billion total in 2016, slightly lower than the 9.5-percent share of the $58.106 billion posted in 2015. “The increase in our development financing to Asia and the Pacific reflects our strong commitment to improving the lives of the people in the region,” according to ADB President Takehiko Nakao. “As ADB celebrates 50 years of providing development assistance, we will strive even harder to meet the changing needs of our developing member-countries.” In 2016 the ADB extended $250 million to help the Philippines streamline public expenditures and boost municipal revenue streams. The ADB also extended a $400-millionworth loan to expand the country's Conditional Cash Transfer (CCT) Program. The CCT provides health and education grants to 4.4 million households nationwide. The Manila-based lender also extended $60 million to the country to increase access to safe drinking water for an extra 200,000 people and improve sanitation for another 400,000 people outside Metro Manila.

“We cannot be complacent,” Nakao added. “The fact remains there are still 330 million people living in absolute poverty across Asia and the Pacific. A lack of infrastructure continues to limit economic growth, inhibit poverty reduction and restrict improvements to quality of life.” Data showed ADB’s three largest borrowers are the People’s Republic of China, India and Indonesia, which represents 59.8 percent of the portfolio in 2016. Loans extended to China reached $15.615 billion, or 24.8 percent of the total, while it reached $13.331 billion, or 21.2 percent for India. Loans extended to Indonesia reached $8.7 billion, or 13.8 percent of the total. ADB’s total lending in 2016, including cofinancing, reached $31.7 billion—an 18-percent increase from 2015, according to the annual report. The total include $17.47 billion in approvals for loans and grants, $169 million for technical assistance, and $14.06 billion for cofinancing, which increased by a record 31 percent over 2015. Disbursements, a key indicator for successful project implementation, also reached a new high of $12.26 billion in 2016. Private-sector operations reached $2.5 billion for only the second time in ADB’s history—a result reflecting ADB’s longterm strategy to significantly boost support for private enterprise to create more high quality jobs and increase living standards across Asia and the Pacific. Apart from its own funds, ADB’s privatesector operations also generated a record $5.84 billion in cofinancing—a $1.2-billion increase from 2015—which included $238 million in official cofinancing to support nonsovereign operations.

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he Light Rail Transit Authority (LRTA) will provide certificates for commuters who may be affected by the frequent breakdown of trains in the Light Railway Transit (LRT) system. The LRTA said this is part of efforts of government to address the recent “technical glitches” of trains in the major railway systems in Metro Manila, particularly the Metro Rail Transit Line 3 (MRT 3). The agency, in its letter to Transportation Undersecretary for Railways Cesar Chavez, said the certificates to be given to employees who regularly ride the LRT will ask employers not to deduct their salaries in the event they will be late for work due to delays caused by malfunctioning trains. The LRTA maintains a record on incidents of which will become the basis for the grant of the delay certificates. He urged commuters to visit train stations or call hotline 8888 to claim their delay certificates. Meanwhile, the Department of Transportation (DOTr) has given Busan Universal Rail Inc. (Buri), the maintenance provider of MRT 3, seven days to explain the derailment of one of its trains last week or face cancellation of its contract. Chavez served a notice to Buri a day after the derailment, which happened after the passengers got off at the MRT North Avenue Station in Quezon City. The train’s gearbox reportedly snapped

New Tieza C.O.O. Tourism Secretary Wanda Corazon T. Teo swears in Pocholo Joselito de Dios Paragas as the COO of the Tourism Infrastructure Enterprise Zone Authority on Monday at the Department of Tourism main office in Makati City. PNA photo courtesy of DOT

causing the train to slip off the tracks. Meanwhile, Party-list Rep. Jericho Nograles of Puwersa ng Bayaning Atleta (PBA) urged the House of Representatives to investigate the incident as he claimed the MRT 3 management and Buri deliberately hid the

derailment from the public. House Resolution 487 calls on the transportation committee, headed by Rep. Cesar Sarmiento of Catanduanes, to question MRT 3 officials and Buri about its alleged substandard services. PNA

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AseanWednesday BusinessMirror

THE CODE OF CONDUCT IN THE SOUTH CHINA SEA

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ooming large in the back of the minds of delegates to the Asean 30th Summit meeting this week in Manila is the disturbing South China Sea dispute. The Philippines considers the South China Sea conflict equally, if not more important than realizing the economic integration of the 10 members-states. It is hoped that the framework for the Code of Conduct in the South China Sea will prod China to redefine and tone down its unilateral and aggressive designs on the disputed sea lane, which it claims to wholly own. Asean members are asserting their ownership of specific areas that fall within their exclusive economic zones, as defined under the UN Convention on the Laws of the Sea. The Philippines has particular interest in the drafting of the code, since its claims over areas in the South China Sea were held valid and binding by the Permanent Court of Arbitration in The Hague on the case it filed against China, which refuses to honor the decision. Once the Code of Conduct on the South China Sea is promulgated,

Congress, particularly the Special Committee on the South China Sea Dispute, chaired by former Speaker Feliciano R. Belmonte, should conduct hearings on this troubling dispute. It is necessary that the highest policy-making agency of the government should define the country’s stand on this issue. While China firmly refuses to respect the decision of the Arbitration Court, it welcomes bilateral talks to resolve the conflicts. China has shown, in past instances, its willingness to compromise and settle differences through direct, one-on-one dialogues with other countries. What China prefers is quiet diplomacy, where it may sacrifice some of its interests, as long as it does not lose face. Ernesto Banawis Sr.

Editor: Max V. de Leon • Wednesday, April 26, 2017 A5

Indonesia bets on $200-billion spending to hike energy output

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ndonesia plans to overhaul its energy policy to attract investment of as much as $200 billion over the next decade, as the former Organization of the Petroleum Exporting Countries (Opec) member seeks to reverse a decline in its crude-oil production.

The amendments to the energy policy, once approved by President Joko Widodo, will allow explorers various financial incentives, including tax-free import of drilling equipment and technology and easier cost-recovery, Energy and Mineral Resources Minister Ignasius Jonan said in an interview in Jakarta on April 22. The nation is offering 14 unexplored oil and gas blocks, mostly offshore fields, to investors and expect both foreign and domestic companies to actively participate, he said. Southeast Asia’s biggest economy is seeking to lift production of oil

and gas as a supply deficit widens, deepening the nation’s reliance on imports. Indonesia suspended its membership of the Opec in November after just one year of rejoining the group, as it struggled to stem a decline in crude and gas production caused by aging fields and a lack of investment in exploration for years. While the development of a muchdelayed Masela gas project may cost as much as $16 billion, the East Natuna block with an estimated reserves of 48 trillion cubic feet of gas may require an investment of $30 billion to $40 billion, Jonan said.

1M barrels Indonesia’s projected daily crude-oil output by 2019

More than a dozen oil, gas and coal-bed methane fields being offered for development next month may need explorers to pump in $20 billion to $30 billion, he said.

Rosneft, Aramco

PT Pertamina, the state-owned oil behemoth, is spending billions of dollars to boost output at its oil and gas fields and expanding refining capacities in partnership with Russia’s Rosneft OAO and Saudi Arabian Oil Co. Indonesia’s crude output is seen topping 1 million barrels per day by 2019 from about 800,000 barrels now through a revamp of explorations of existing fields and the so-called enhanced oil recovery program, Jonan said. “When people talk about oil and

gas, from a business perspective, people tend to focus on upstream, production, exploration and so on, but for the government it’s all of these,” Jonan said. “If we focus on the upstream, the question is how many reserves, how many oil and gas fields that have not been explored, that’s the issue.” Indonesia may need to import half of its annual fuel needs even after increasing its refining capacity by 500,000 barrels a day in the next seven years, according to BMI Research. The nation’s processing capacity may grow 2 percent by 2025 while consumption surges 31 percent in the same period, according to BMI. “For the next ten years we will continue to import,” Jonan said. “The president has said if we continue the import, it should be more of crude oil and not fuel. That’s why the president keeps pushing Pertamina to build refinery locally.” Indonesia currently produces about 800,000 barrels of crude oil a day and imports about 500,000 barrels of crude and about 800,000 barrels of refined products, Jonan said. Bloomberg News

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US middle class shrank in 20 years

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ike McCabe’s neighbors in rural Gillespie, Illinois, consider him lucky. After being out of work for a year, he landed a job in January making cardboard boxes at a nearby GeorgiaPacific plant for $19.60 an hour.

He would agree with them, were it not for the fact that his previous job in a steel mill near Saint Louis paid $28 an hour. “I’ve had to rethink my whole life to make ends meet on what I’m now making,” McCabe said. “The middle class is struggling for sure, and almost anybody in my position will tell you that.” Middle-class Americans have fared worse in many ways than their counterparts in economically advanced countries in Western Europe in recent decades, according to a study released on Monday by the Pew Research Center. What is more, as McCabe’s experience suggests, the authors of the Pew study found a broader contraction of the American middle class, even as the ranks of the poor and the rich have grown. “Compared with the Western European experience, the adult population in the US is more economically divided,” said Rakesh Kochhar, associate director for research at Pew. “It is more hollowed out in the middle. This speaks to the higher level of income inequality in the United States.” For example, between 1991 and 2010, the proportion of adults in middle-income households fell to 59 percent, from 62 percent, while it rose to 67 percent, from 61 percent over the same period in

59%

The percentage of the proportion of adults in middle-income households between 1991 and 2010, from 62 percent Britain and to 74 percent, from 72 percent, in France. Households that earned from two-thirds to double the national median income were defined as middle income in the Pew study; in the US that translated into annual income of $35,294 to $105,881, after taxes, in 2010. A shrinking middle class is not necessarily cause for alarm, if the reason for the contraction is that more people are moving up the income ladder, said David Autor, a professor of economics at the Massachusetts Institute of Technology. The proportion at the top did rise, but so did the proportion at the bottom, rising to 26 percent, from 25 percent. That is much more wor r isome, said Autor, who was not involved with the Pew study.

Brooklyn College students walk between classes on campus in New York. The New York State Legislature approved a budget on April 9 that includes funding for Democratic Gov. Andrew Cuomo’s plan to offer free tuition for middle-class students at state universities. AP/Bebeto Matthews

Moreover, the middle-income group was smaller—and the groups at either extreme larger—in the US than in any of the 11 Western European countries studied. And incomes in the middle rose faster in Europe than they did in the US, according to Pew. Median incomes in the middle tier grew by 9 percent in the US between 1991 and 2010, compared with a 25-percent gain in Denmark and a 35-percent increase in Britain. The US, including the middle class, has a higher median income than nearly all of Europe, even if the Continent is catching up. The median household income in the US was $52,941 after taxes in

2010, compared with $41,047 in Germany and $41,076 in France. And while inequality may be widening, the proportion of households in the upper-income strata rose to 15 percent, from 13 percent. “Financially, the US remains well ahead of the countries in Europe,” Kochhar said. “The difference is how incomes have evolved, and they are catching up.” A lthough the cutoff of the study, 2010, may have highlighted weak income gains because it was in the immediate aftermath of the Great Recession, he said that was not enough to alter the study’s findings. “It’s a clear trend that the mid-

dle class in the US is shrinking and not keeping up financially with the upper-income group,” he said. “There is an aura of redistribution of income from middle income to upper income.” The study acknowledges that “middle class” can connote more than just income—like a college education, white-collar work, economic security, homeownership or even self-image—but for the purposes of the study, it was defined by income. Whether in Europe or the US, technological change and globalization mean that people who can adapt and learn new skills can reap bigger rewards, Kochhar said.

Since founding LaSalle Network, a staffing company based in Chicago, with two employees nearly 20 years ago, Tom Gimbel has watched revenues grow to a projected $70 million this year. “I know a lot of people who have done much better in the last five years,” he said. “I have people working for me who made $35,000 to $60,000 a few years ago and are earning $60,000 to $150,000 now.” Gimbel, who grew up in a comfortable Chicago suburb, has seen his own fortunes improve as well. “We didn’t want for anything, but my dad wasn’t rolling in money,” he said. “I’ve succeeded beyond where my parents were.” New York Times News Service

N. Korea celebrates as S. Korea, US keep watch Venezuelans stage sit-in on roads to protest govt P C

YONGYANG, North Korea—A US guided-missile submarine arrived in South Korea on Tuesday and envoys from the US, Japan and South Korea met in Tokyo, as North Korea marked the anniversary of the founding of its military. Though experts thought a nuclear test or ballistic missile launch might happen, the morning came and went without either. South Korea’s Yonhap news agency, citing a South Korean government source, reported that North Korea instead appeared to have held a major live-fire drill in the Wonsan city area.

North Korean general warns of preemptive strike

Crowds in Pyongyang, the North Korean capital, laid flowers and paid respects at giant statues of the country’s former leaders Kim Il Sung and Kim Jong Il, one day after the minister of defense reiterated that the North is ready to use preemptive strikes or any measures it deems necessary to defend itself against the “US imperialists”. “The situation prevailing on the Korean Peninsula is so tense that a nuclear war may break out due to the frantic war drills of the US imperialists and their vassal forces for aggression,” Gen. Pak Yong Sik told a “national meeting” of thousands of senior military and civilian officials. South Korea’s military said it is closely watching North Korean troop movement around Wonsan, but didn’t confirm the Yonhap report, which cited an unnamed source, saying the North carried out an exercise with 300 to 400 artillery pieces. The streets of Pyongyang were quiet. Flower-laying and bowing at statues and portraits of the leaders is a regular routine on major anniversaries. People also gathered in open spaces to take part in organized

A young girl watches as North Korean men and women take part in a mass dance on April 25 in Pyongyang, North Korea. Pyongyang residents hold mass dances across the city to mark the 85th anniversary of the country’s army. Despite deepening tensions on the Korean Peninsula, and reports of a major military drill on the country’s east coast, the North’s capital was quiet. AP/Eric Talmadge

dancing, another common way to mark holidays. “Our great leaders founded and wisely led our revolutionary army, and just like that, now our respected Marshal Kim Jong Un is leading wisely, so even though the situation is tense, we are celebrating the day,” said Choe Un Byol, who had come with his family to the bronze statues of the former leaders. North Korea often also marks significant dates by displaying its military capability. Pyongyang launched a missile one day after the 105th birthday of late founder Kim Il Sung on April 15. Recent US commercial satellite images indicate increased activity around North Korea’s nuclear test site, and third-generation dictator Kim has said the country’s preparation for an intercontinental ballistic missile (ICBM) launch is in its “final stage”.

US navy gathers off Koreas

The USS Michigan, a nuclear-powered

submarine, arrived at the South Korean port of Busan in what was described as a routine visit to rest the crew and load supplies. Cmdr. Jang Wook from South Korean navy public affairs said there was no plan for a drill. The submarine’s arrival comes as the USS Carl Vinson aircraft carrier heads toward the Korean Peninsula for a joint exercise with South Korea around the weekend. Despite the buildup, President Donald J. Trump has reportedly settled on a strategy that emphasizes increased pressure on North Korea with the help of China, the North’s only major ally, instead of military options or trying to overthrow North Korea’s government.

Washington’s words

Trump told ambassadors from UN Security Council member-countries that they must be prepared to impose additional and stronger sanctions on North Korea. “This is a real threat to the world,

whether we want to talk about it or not,” Trump said at a White House meeting on Monday. “North Korea is a big world problem, and it’s a problem we have to finally solve. People have put blindfolds on for decades, and now it’s time to solve the problem.” Nikki Haley, Trump’s UN ambassador, said the US is not looking for a fight with Kim and would not attack North Korea “unless he gives us reason to do something”. She praised China’s increased pressure on North Korea. Asked about the threshold for US action, Haley told American broadcaster NBC that “if you see him attack a military base, if you see some sort of [ICBM], then obviously we’re going to do that”. But asked what if North Korea tests an intercontinental missile or nuclear device, she said: “I think then the president steps in and decides what’s going to happen.”

Diplomats meet in Tokyo

The US, Japan and South Korea agreed on Tuesday to put maximum pressure on North Korea, the South’s envoy for North Korea said after meeting his American and Japanese counterparts in Tokyo. “We agreed to warn North Korea to stop any additional strategic provocation and take intolerably strong punitive measures against Pyongyang if it goes ahead with such provocations,” Kim Hong-kyun told reporters following his meeting with Joseph Yun of the US and Japan’s Kenji Kanasugi. Kim said they discussed ways to get more cooperation from China and Russia, which they agreed is crucial to applying effective pressure on North Korea to abandon its nuclear weapons program. He said they also recognized China’s recent steps toward that goal. AP

ARACAS, Venezuela—Protesters sprawled in lawn chairs, worked on math homework and played cards on main roads around Venezuela’s cities on Monday, joining in sitins to disrupt traffic as the latest slap at the socialist government. Thousands shut down the main highway in Caracas to express their anger with the increasingly embattled administration of President Nicolas Maduro. They turned the road into a kind of public plaza, with protesters settling in for picnics, reading books and reclining under umbrellas they brought to protect against the blazing Caribbean sun. In the provinces, protests turned deadly. The public prosecutor announced that 54-year-old Renzo Rodriguez was killed by a gunshot to the chest on Monday at a protest in the plains state of Barinas. In the mountain town of Merida, state worker Jesus Sulbaran was fatally shot in the neck at a pro-government rally. In addition, five people were injured at the Merida protest, Venezuela ombudsman Tarek William Saab said. The two killings raised to 23 the number of deaths linked to unrest that began almost a month ago over the Supreme Court’s decision to gut the opposition-controlled congress of its powers. The Caracas gathering was largely peaceful, though some protesters wrapped bandanas around their faces and threw stones at the police, prompting state security forces to release a cloud of tear gas. Juan Carlos Bautista passed the afternoon playing dominos. “We want to be free. I’m here fighting for my children and my children’s children,” he said. The current wave of protests is the most intense the economically struggling country has seen since two months of antigovernment protests in 2014 that left dozens dead. But while those protests were led by young people who built flaming barricades in

the street, this month’s movement is attracting masses of older protesters, who say they are fighting not for themselves, but for the younger generations. Protesters in at least a dozen other cities staged sit-ins, with some building barricades to stop traffic. In Caracas protesters dragged concrete slabs, garbage and even a bathtub into the road. Retired Prof. Lisbeth Colina said she decided to participate in the sit-in for her grandchildren. “The side that gives up is the side that loses,” she said. “We must remain in the streets. I’m not scared of the repression they’re throwing at us,” she said. As the sit-ins disrupted traffic, Maduro’s administration announced that it had no plans to expropriate General Motors’s (GM) Venezuelan subsidiary. A court last week ordered the seizure of a GM plant and the company responded by shuttering its operations in the country. Both the US State Department and the government said previously that the case involved a longstanding lawsuit against GM by a former dealership in Venezuela. Maduro said on Sunday he wouldn’t give in to opponents and again urged them rejoin negotiations they broke off last December. For mer Dominican Republic President Leonel Fernandez came to Caracas on Monday to meet with Maduro. He had backed last year’s negotiations, which collapsed over the government’s refusal to meet opposition demands for elections and the release of political prisoners. But opposition leaders had no plans to meet with Maduro. They are rejecting calls for dialogue and demanding the immediate scheduling of elections. “The government wants to use negotiations as a ploy to divide us, demobilize us, and win itself time,” Congress Vice President Freddy Guevara told reporters. “This protest is an exercise in resistance and a test of our conviction.” AP

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Wednesday, April 26, 2017

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Trump seeking 15% tax rate for biz

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ASHINGTON—President Donald J. Trump has instructed his advisers to make cutting the corporate-tax rate to 15 percent a centerpiece of his taxcut blueprint to be unveiled this week, according to people with knowledge of his plans, even if that means a significant reduction in revenue that could jettison his campaign promise to curb deficits. Cutting the corporate tax rate to 15 percent, from its current 35-percent level, was one of Trump’s marquee campaign promises, part of his vision of carrying out “maybe the biggest tax cut we’ve ever had”. But he has yet to publicly embrace the move since taking office, and his decision to do so now could set up a showdown with Congress over a proposal that would most likely blow up the deficit. The White House is planning to formally roll out its tax plan on Wednesday, ending months of speculation about the president’s intentions for rewriting the tax code and following a prolonged period of confusion, in which he and his top advisers sent mixed messages about what elements they favored and how the tax cut would be structured. T he people who descr ibed Trump’s corporate-tax cut target, first reported by The Wall Street Journal on Monday, did so on the condition of anonymity because they were not authorized to discuss it before an official announcement. The president plans to unveil the tax cut during a week when Republicans will be trying to pass a spending measure needed to keep the government from shutting down. Repealing and replacing the Affordable Care Act remains a legislative priority, although whether it is considered more important than a tax overhaul changes frequently. The 15-percent rate is lower than what House Republicans proposed in the tax-cut blueprint being pitched by House Speaker Paul Ryan, and it could be difficult to move through Congress. Sen. Orrin G. Hatch of Utah, the Republican chairman of the Senate Finance Committee, said on Monday that such a deep cut might not be well received by Trump’s party because of its potential to increase the deficit. The nonpartisan Tax Policy Center estimated last year that the cor-

$2.4T

President Donald J. Trump poses for a portrait in the Oval Office in Washington on April 21. AP/Andrew Harnik

porate tax-cut plan Trump had proposed, which at the time included the repeal of the alternative minimum tax, would cost $2.4 trillion over a decade. Still, Steven Mnuchin, the secretary of the Treasury, said on Monday he was confident the administration’s tax proposal would “pay for itself” through economic growth. He said a growth rate of 3 percent was achievable. Mnuchin also said the Trump administration would lay out plans to cut middle-income tax rates, simplify the tax code and make US companies more competitive with foreign ones. The White House would not say if it is on board with the “borderadjustment” tax, a 20-percent tax on imports that is central to Ryan’s plan. There are also lingering questions about what shape the rest of the plan will take, and even about the timetable for pushing it through. Trump has said he still believes a health-care overhaul effort that collapsed last month must be completed before the plan to rewrite the tax code can advance. White House officials declined to comment on the 15-percent target, which people close to the administration cautioned could change between now and the announcement on Wednesday, perhaps, repeatedly. They warned that the details were sketchy at best, and others who have

discussed the tax-overhaul plan with administration officials recently said there was still indecision at the highest levels about what elements to include and in what form. The Wednesday deadline, set hastily by Trump last week in a comment that appeared to take some of his closest advisers off guard, was an effort to showcase an ambitious plan for economic growth during his first 100 days in office. During the campaign, he promised to introduce a tax cut proposal to Congress in the first 100 days. But he has had no major legislative achievements to point to as evidence of an activist economic agenda. The 15-percent cut represents a return for Trump to the economic vision that animated his campaign, and a victory of sorts for Mnuchin, who has been a supporter of the plan. The cut also helps Mnuchin jockey for position as the driving force behind the tax-overhaul effort. “Our analysis has always shown that of all the economic bang for the buck from all of the changes that were in the original Trump plan, you get the most economic juice from cutting the corporate rate,” said Stephen Moore, an economist at the Heritage Foundation who advised Trump’s presidential campaign. One question that Trump will have to answer, Moore said, is whether the 15-percent rate would apply only to corporations or to small businesses, as well. But there are plenty of other unknowns, he added. “They can change their minds,”

The cost of the corporate taxcut plan President Donald J. Trump had proposed, which at the time included the repeal of the alternative minimum tax, over a decade.

US embassies post article extolling Trump’s Mar-a-Lago W

ASHINGTON—The State Department is tasked with promoting American interests abroad, but marketing a private club owned by the US president has not generally been part of its official duties—until now. An article posted on many US Embassy web sites around the world gave a visitors’ guide to Mar-a-Lago, President Donald J. Trump’s club in Palm Beach, Florida, that has become something of a “winter White House” because of his frequent visits there. Its presence set off critics quick to look for conflicts of interest between the president and his businesses. The article was taken down late on Monday from the State Department’s ShareAmerica site, but it remained on some embassy sites. A note in its place said, “The intention of the article was to inform the public about where the president has been hosting world leaders. We regret any misperception and have removed the post.” The article had a straightforward

description of the resort: “When socialite and cereal heiress Marjorie Merriweather Post built Mar-aLago—Spanish for ‘Sea to Lake’— in 1927, she spared no expense,” it said. “The 114-room mansion sits on 8 hectares of land, with the Atlantic Ocean on one side and an inland waterway on the other.” It went on to say that Post willed the estate to the federal government, hoping it would become a vacation home for presidents. But when no president used it that way, the government gave it back. The article noted that Trump bought the estate in 1985; he opened it to dues-paying members in 1995. His visits there have “finally” fulfilled Post’s dream, the article stated. On Twitter, the article quickly became fodder for critics. “As the WH plans deep cuts to hunger programs and foreign aid, so nice to see taxpayer money being used responsibly ... to promote Mara-Lago,” wrote Rep. Mark Takano, Democrat-California. Sen. Ron Wyden, Democrat-Ore-

gon, said on Twitter, “Why are taxpayer $$ promoting the president’s private country club?” He later posted the article, saying, “Here’s the full post in its kleptocratic glory.” At an afternoon briefing at the State Department, Mark Toner, a department spokesman, said he had no information about why the article was created and posted by embassies around the world. After a quick check, posts were seen on embassy web sites and Facebook pages in Britain and Albania. Presidential scholars and ethics lawyers have, since the beginning of the Trump administration, stated concerns about how Trump and his family separate their personal business interests from the president’s official duties. The ShareAmerica site, where the Mar-a-Lago article first appeared in early April, contains articles on various aspects of American culture, including the first lady, the Detroit auto show, cheetah cubs a nd Ma hoga ny Jones, a rapper. New York Times News Service

Moore said. “They’ve been all over the map.” Members of Trump’s team of economic advisers are set to meet with Republican leaders in Congress on Tuesday to discuss the plan. Hatch said in an interview with NBC that such a deep cut was troublesome because it would add to the deficit. “I have some real reservations about it, but I’m open to good ideas wherever they

come,” Hatch said. “All I can say is, I think it’s got a long way to go and it’s going to be a difficult matter to get through both bodies.” Roberton Williams, a fellow at the Tax Policy Center who analyzed Trump’s campaign tax plan, said its high cost would make it more difficult to push through Congress. “It’s very expensive, and that’s a problem,” Williams said. “It’s a real heavy lift to get the revenue

necessary to pay for these things.” Williams said the president’s recent emphasis on tax “cuts” suggested that he was prepared to lose revenue and hope that economic growth will make up the difference. However, Williams said, such a plan could be difficult for fiscal conservatives to swallow. “That makes it a lot harder with the budget hawks in Congress,” he said. Republicans are expecting to pass tax legislation without the support of any Democrats using the Senate’s budget reconciliation procedure. That requires only 51 votes for passage. But if changes to the tax code add to the deficit, they would expire after 10 years, adding uncertainty for businesses and possibly hurting economic growth. Economic advisers from Trump’s campaign had been unhappy that he seemed to be drifting away from the tax principles that helped get him elected. But on Monday, Lawrence A. Kudlow, one of the economists who helped craft Trump’s plan, said he was pleased that Trump appeared to be returning to those roots. “We were at 15 percent from Day 1,” Kudlow said, lamenting that Trump’s new economic advisers had discussed scrapping the campaign tax plan. “All the noise in the last week or 10 days sounds like they haven’t junked the plan.” New York Times News Service

The Regions BusinessMirror

A8 Wednesday, April 26, 2017 • Editor: Efleda P. Campos

news@businessmirror.com.ph

Jueteng still rampant Mindanao Trust Fund transitions in La Union, Pangasinan into facility covering Mindanao By Orly Guirao | Correspondent

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AN FERNANDO CITY, La Union—The operation of the illegal numbers game “jueteng” continues unabated in this province and nearby Pangasinan with daily bets fetching an average of P5 million to P6 million. This was learned after the BusinessMirror placed a bet for P20 on Monday on the two-numbers game, called pares, authorized by the Philippine Charity Sweepstakes Office (PCSO) in one of the booking outlets of First La Union Leisure Entertainment and Gaming Corp., a PCSO-authorized agent corporation (AAC) for small-town lottery (STL). Pl ay i ng on pares, b et tor s choose a two-number combination from a numbers pool of 1 to 38, which the sales representative (called kabo) writes on a strip of paper (pulyetos) similar to the betting pads used in jueteng. Under PCSO-STL rules, the bets are supposed to be issued receipts through a mobile handheld terminal (MHT), a gadget carried by sales representatives of an AAC in a given province, city or municipality. There is only one AAC in La Union which holds the three daily draws in Barangay Pagdalagan along the national highway in this city. The PCSO rules also require sales representatives of AACs to wear uniforms and carry PCSO-

STL identification cards provided by the local gaming outfit. However, this rule is blatantly violated as nobody among the bet takers was found by the BusinessMirror to be wearing the prescribed uniforms and IDs as they go on their assigned areas no different from the ragtag jueteng operations. Interviewed, one of the kabo said each of them are paid 10 percent of the bets placed, but admitted they were not as yet given benefits of coverage under the Social Security System (SSS) as required by the PCSO rules. In Pangasinan STL authorized agent Golden Go Gaming Corp., which goes on similar mode of operation as the La Union AAC, struggles to compete with controversial Atong Ang’s Meridien Vista Gaming Corp., which still holds sway in the gameof-chance from Cagayan to the rest of northern Luzon. Even without a PCSO authority to operate STL, police authorities tolerate Meridien’s computersimulated jai-alai games with betting on two-number combination similar to STL pares mainly due to the Supreme Court’s temporary restraining order. Golden Go, reportedly owned by a retired Armed Forces general, and Meridien are in cut-throat competition to get hold of the estimated P15-million daily bets on three draws a day.

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By Manuel T. Cayon | Mindanao Bureau Chief

AVAO CITY—The government has tendered—and the revolutionary Left has accepted— the template it used in implementing development projects in territories held by the Muslim guerrillas even if the two parties were still locked in the nitty-gritty of the peace negotiations. The template would also see the transitioning of the Mindanao Trust Fund (MTF) into a bigger fund facility to include not only the Bangsamoro areas, but also the rest of Mindanao, “including the fragile areas”, Presidential Peace Adviser Secretary Jesus G. Dureza said. Dureza added t he concept of implementing development projects for guerrilla areas even without a peace settlement yet has been offered in the recent round of formal negotiations with the National Democratic Front (NDF), “which the NDF has immediately accepted”. “ The NDF has now created its own Committee on Develop-

ment, headed by Luis Jalandoni, the former chief negotiator of the NDF,” Dureza said. Dureza added the template refers to the world’s first initiated infrastructure and livelihood-capacitating development program applied during the peace negotiations with the Moro Islamic Liberation Front (MILF). It was conceived in 2005 and officially began the following year. It allowed the MILF full management and administration of funds from several countries and foreign funders to implement the development projects in conflict-assisted areas. In the program here that announced the transition of the MTF to a Mindanao-wide funding facility to include now the “fragile communities”, the MTF said it released a total of P1.4 billion in 11 years and completed 573 projects for 650,000 people in 315 conflictaffected communities. Mara Warwick, World Bank country director, said the development program was the first of such venture in any conflict areas in the world, where development projects

were being implemented in rebelheld territories. Dureza said the respective committees formed by the NDF and the government panel would plan the framework and talked with international funding donors and governments that have helped fund the MTF. A source privy to the forming of the development strategy for NDF areas said the government peace body has tapped the United Nations Development Program to form the structure of the fund body akin to the MTF. In the case of the MTF formed by the World Bank, the European Union provided the bulk of the funds with P1.17 billion ($22 million) to the facility. The other donor countries included Sweden, Australia, Canada, the United States and New Zealand. It could not be immediately ascertained if the new development program would allow the NDF to form its own development agency as what was done with the MILF experience, allowed to form the Bangsamoro Development Authority to manage and administer the fund according to the approved projects coming from community suggestions. Dureza said “the MTF is not on its swan song, and would not be closing.” “It will be extended to 2019,” he told the meeting of the MTF beneficiaries at the SMX Convention Center here, and titled the MTFReconstruction and Development Program closing ceremony. He said the original MTF concept would undergo a transition toward “a bigger facility that would cover all areas in Mindanao, not only the Bangsamoro”. “These would include the fragile

areas, and the areas where the Communist Party operates,” he said. Warwick also said the World Bank worked closely with the MILF and the government on this transition. “The size of the fund would be finalized,” she said. Dureza said the size of the fund would also depend on the commitment of the MTF donors. He said projects to be funded in the next two years would still rely on the result of the community needs assessment “that must come from the people themselves”. Dr. Saffrulah M. Dipatuan, chairman of the board of directors of the Bangsamoro Development Authority, said it already crafted the other projects and were enumerated already in its development plan. The embassies told Dureza and Warwick they would await the result of the new framework for the bigger fund facility before their governments would make official commitments. “Be assured the European Union remains committed to help the Philippines, especially Mindanao, even if we are not really obliged to support. But we have been pouring our support, especially for Mindanao, because we believe the development of Mindanao would greatly contribute to the development of the entire Philippines,” said Ambassador Franz Jessen, the head of delegation of the EU to the Philippines. R ic ha rd Rodgers, pol it ica l and public-affairs counselor of the Embassy of Australia, said his country has been entrenched in assisting Mindanao, with its long-running assistance to basic education and a special similar program for the Autonomous Region in Muslim Mindanao.

FARM TREK To beat the summer heat, B

usinessMirror contributing photographer Suzanne June Perante and her younger brother Nonie trek to an organic tomato farm in Tucod, Cabarroguis, Quirino, near the OceanaGold Sustainable Agroforestry nursery, where a demo farm exists. LEONARDO PERANTE II

Magalang next tourism hot spot of Pampanga By Ashley Manabat Correspondent

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AGALANG, Pampanga— Nestled at the foot of the fabled Mount Arayat, this bucolic town is embarking on a serious promotion as another tourism hot spot with its heritage, cultural and ecotourism sites. Mayor Malu Lacson and Vice Mayor Norman Lacson said they are actively promoting the town’s tour ism potentia ls, not only as a Holy Week destination for pilgrims at “Banal na Bundok” (Holy Mountain), where the 14 Stations of the Cross are built, but also a year-round destination for tourists. Most of its splendor yet undis-

covered, this town is the northeastern municipality of Pampanga connecting it to the neighboring province of Nueva Ecija. “Our town is a beautiful place and we want its attractions promoted,” Mayor Lacson said. She and the vice mayor met with the Capampangan in Media Inc. last Friday at Abe’s Farm, one of this town’s top destination. The mayor said they are showing tourists the only remaining heliograph towers in the country. These are old structures that used to send and relay signals to warn soldiers of an impending attack by the advancing enemy. Built by the Spanish forces in the 1800s, a tower in Barangay Santa Cruz and another in San

Isidro await official recognition as National Cultural Treasures by the national government, Mayor Lacson said. She said Magalang is a place blessed with sites for heritage and cultural ecotourism. The mayor said Abe’s Farm is now a popular dining and spa resort at the foot of Mount Arayat, which is frequented by local, as well as foreign tourists and food connoisseurs from all over the world. She said this town is also known as the Sweet Tamarind Capital of the Philippines, thus, paving the way for it to be known as another culinary attraction as it promotes home-made pastries and candies by Carreon and Pabalan, two homegrown stores.

ExportUnlimited BusinessMirror

Editor: Efleda P. Campos • Wednesday, April 26, 2017 A9

Citem seeks P843-M sales in Manila FAME 2017 By Roderick L. Abad

Contributor

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@rodrik_28

HE Center for International Trade Expositions and Missions (Citem) said it earned over P6.73 billion in export, domestic and retail sales over the last five years, and expects to generate around P843 million for the staging of its twiceyearly trade exhibition in April and October 2017.

“Manila FAME has been a sourcing destination for global quality and finely crafted furniture and home furnishings, holiday gifts and decors, and fashion accessories from the country’s top, as well as emerging, design talents and manufacturers,” said Citem Project Management Department Manager (DM) Romleah P. Ocampo during the event’s press launch last March 30 at HallOne of Golden Shell Pavilion, Roxas Boulevard corner Sen. Gil J. Puyat Avenue in Pasay City. From 2012 to 2016, she said this show produced P5.96 billion in export sales, P589.4 million in domestic sales, and P183 million in retail sales. Also, it supported close to 2,600 micro, small and medium enterprises (MSMEs). Out of the total 8,418 foreign buyers, 22.8 percent came from the Americas; 21.1 percent, Europe; and 20.4 percent, East Asia. The top buying countries covered 64 percent of overall foreign sales. The United States accounted for 19 percent; Japan, 15 percent; Australia, 6 percent; Hong Kong, 5 percent; Singapore, 5 percent; Germany, 3 percent; France, 3 percent; Taiwan, 3 percent; China, 3 percent; the United Kingdom, 2 percent; and other countries, 36 percent.

“For the 65th edition of Manila FAME, we aim to further push the numbers as we expand our market’s hold to the contract markets across the Middle East, Asia and the Philippines,” she said, adding around 17,000 job opportunities are expected to be opened for staging the trade exposition twice in the country this year. “Manila FAME will continue to position the Philippines as a premier sourcing hub for home, lifestyle and interior-design solutions for the realestate and hospitality-contract markets,” she said. Citem, the export promotions arm of the Department of Trade and Industry, is bullish on achieving this year’s sales target on the back of the continued interest to this yearly affair. In fact, over 300 homegrown MSMEs are joining the first leg of this trade event that will take place at the World Trade Center Metro Manila and the Philippine Trade Training Center from April 21 to April 23. Also, importers, retailers, wholesalers, merchandising agents, traders, architects and interior designers across 9 foreign markets have already started signing up for their attendance. They come from the US, Canada, Japan, South Korea, China,

MARKET DEVELOPMENT UPDATE

Northbound policy Part Two

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AIWAN boasts of a rich culture and colorful history. Its unique political situation and less than abundant natural resources have pushed the Taiwanese to stand up for themselves with so much determination, propelling them to become one of the world’s most successful economies and vibrant democracies today. Their enterprising Chinese heritage, infrastructure and technology dividends from more than 50 years of Japanese colonial rule, and the Taiwanese’s grit to develop knowledge and to carve their own bright spot under the sun have brought about the Taiwan economic miracle. In the 1970s Taiwan became a leader in light manufacturing. She then slowly climbed up the value chain. In the 1980s and 1990s, Taiwan successfully took the place as a leading high-tech center. Today, she positions herself as the Asian Silicon Valley. Just to complete my description of Taiwan, here are some additional facts. Taiwan is home to the world’s largest chip maker (TSMC); largest footwear-manufacturing company (Pou Chen Group); largest electronics-contract manufacturing company (Foxconn); the largest metal casings for phones and notebooks (Catcher); and largest bicycle-manufacturing company (Giant), to name a few. Also, Taiwanese companies produce more than 70 percent of the world’s laptops and notebooks like Acer, Asus and those that produce for HP, Toshiba, Dell and others. She is

By Benedict M. Uy Director of Commercial Affairs, Manila Economic and Cultural Office in Taipei Foreign Trade Service Cops-DTI

also the leading LCD panel manufacturer. Many of the world’s top manufacturers for information and communications technology, machinery, equipment and tools are Taiwanese. All these make for an indispensable partner in the global supply chain. The major brands, companies and accolades mentioned, in the context of this article are not as important as the implied presence of a robust value chain and small and medium enterprise base in Taiwan that enable these big companies to thrive. It also shows the level of research and development that runs behind the scenes to churn out innovative products, concepts and technologies that keep them steps ahead of the competition, and of course, to drive production efficiencies across all sectors and industries. To name a few, there is the Industrial Technology Research Institute, Taiwan Footwear Research Institute, Asian Vegetable Center, Taiwan Agricultural Research Institute, Fisheries Research Institute, Precision Machinery Research and Development Center Taiwan Textile Research Institute and the Corporate Synergy Development Center for their OTOP program. To be concluded

Germany, United Arab Emirates, Saudi Arabia and Australia. “We’re about 98 percent booked. In fact, we have to say ‘no’ to the late registrants. I think it is going to be a very, very interesting show,” he said. Aside from the positive turnout for this business- sourcing platform, Citem is on track to reach its goal given the country’s constant participation in the export industry’s overseas marketing events and a strengthened collaboration with business-support organizations. Citem Executive Director Clayton Tugonon said they will continue to broaden the base of the nation’s local artisans and designers to create world-class products. “I will continue to comb every corner of the islands in search of companies I can push their limits to become exporters. We will institute more strategic and rationalized support system to equip them to produce export ready products,” he said. The export market is so huge it needs more domestic players to enable the country’s presence felt in this field. Unfortunately, the Philippines still holds a very small share of it, he said. “If I’m not mistaken, we’re partaking only three percent of this sector for home furniture and furnishings, fashion accessories,” Ocampo told the BusinessMirror at a sideline interview. She said Citem will intensify its product- development program that would benefit more of the country’s small and medium scale manufacturers, as well as champion the nation’s export competitiveness in the global market through Manila FAME. “It’s a lot of hard work. It’s a combination of different factors,” Ocampo said. “We have to have a critical mass of exhibitors. That’s one. And then for the buyers, especially for those who are coming from far- away places, it has to be beneficial for them.” Because foreign buyers look for something new, she encouraged exhibitors to create a good number

MEMBERS of the media are briefed by (from left) Maria Rita “Rhea” Matute, executive director of the Design Center of the Philippines; Clayton Hipe Tugonon, executive director of the Center for International Trade Expositions and Missions; and Stephen Buni, design consultant for the Design Center of the Philippines, during the 2017 Manila FAME press/blog conference. NONOY LACZA

of their latest products developed for the show. Tugonon agreed with her, while emphasizing ingenuity and innovation as competitive factors for local products to be at par in the international market. “We have to be innovative. We have many materials that are only available in the Philippines. Designs can be copied, but materials, never. We have to look around so we can make something out of it and sell,” Tugonon said. “All we have to do is tweak our styles. Just imagine in the next five years, we keep on making new designs, we will be back to being the ‘Milan of Asia’ years ago.” Since competition is always present in the export business, price becomes the differentiator that makes Philippine-made products trail

behind those in Vietnam, China, Thailand, Malaysia, and Indonesia, among others. The market positioning for local products as having “better quality, workmanship and designs” makes them more expensive than their counterparts in the region which, eventually, turns off the foreign market, Ocampo said. “Many of the buyers would be wiling to pay a little more for quality and craftsmanship, but not too ridiculously high.” “That’s the problem with some of our export companies here who are very focused on the design, They tend to forget whether their products are still sellable and marketable or not,” she said. To help address this concern, she said Citem provides exporters with learning programs on the right

pricing and costing. “This should be commensurate to their product-development efforts. We help them on how to put the price to a lower level so that they can combine both design quality with the right pricing,” she said. Another aspect of the export business that needs to be practiced here is the adherence to international standards, such as those of environmental, social and labor laws. “We are a little behind in terms of compliance. So that’s what we are trying to work on together with the Design Center of the Philippines and the DTI [Department of Trade and Industry],” Ocampo said. “Citem will help expand the base of export-capable MSMEs and Filipino world-class designers,” Tugonon added.

DTI-EMB pushes promotion of PHL construction services Part Three

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O support its services, it provides export assistance, business matching, coffee accreditation and export documentation; handles trade complaints through its Export Trade Complaints Committee; and provides market and product consultancy, and export and import statistics. Its four major programs are the Philippine Export Competitiveness Program, Doing Business in Free Trade Areas/Doing Business with the EU Using GSP+, the Regional Interactive Platform for Philippine Exporters (Ripples), and the Halal

Export Industry Development and Promotion Program.

Regional interactive platform for Philippine exporters

RIPPLES is designed for would-be Philippine exporters to make them export-ready. Ripples is under the 2015-2017 Philippine Export Development Plan (PEDP). Memorandum Circular 91, or the PEDP, was signed by former President Benigno S. Aquino III directing 14 executive departments to review all relevant policies to ensure its implementation. These agencies are the Bangko Sentral ng Pilipinas, the departments of Trade and

FILIPINO WOMEN IN GLOBAL BUSINESS

Maria Cristina Coronel of Pointwest By Abigael Mei Yaokana Office of the Director, DTI-EMB

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EAD, Excel and Innovate” are the core values of Pointwest Technologies Corp., a proudly 100-percent Filipino-owned company. Maria Cristina Coronel, president and CEO, cofounded the company with just nine employees. “My goal was to put the Philippines on the global map as a top destination for information-technology and business-process outsourcing [IT-BPO].” Coronel seeks the opportunity to establish the company during an influx of foreign investment in global- sourcing services in 2003, the same year when we witnessed the sudden boom of the call-center industry in the country. The company has expanded in different market circles, with Health

Information Management (HIM) as their leading sector. “This sector had a high-growth rate and we continuously aim to expand further into this field,” Coronel said. Coronel makes sure their company, which takes pride in their world-class services, will be catering highly reliable

Industry, Finance, Agriculture, Environment and Natural Resources, Public Works and Highways, Energy, Transportation and Communications, Interior and Local Government, Health, Labor and Employment, Science and Technology and Foreign Affairs, and the National Economic Development Authority. The 2015 to 2017 PEDP is targeting $100 billion in export revenue at the end of 2017. The PEDP is supported by eight strategies that each agency has a role to implement: 1) Design comprehensive package of support to selected sector; 2) Remove unnecessary regulatory impediments to the movement

of goods and delivery of services; 3) Raise the productivity and competitiveness of Philippine enterprise; 4) Upgrade the quality of standards of export; 5) Improve exporters’ access to trade finance; 6) Exploit opportunities presented by regional and preferential trading arrangements to expand market access within existing trade partners, explore new trade partners and develop new export products; 7) Launch a well coordinated, harmonized and sufficiently funded export and investment promotion campaign; and 8) Enhance the innovative capacity of the export sector to an efficient system of national innovation. To be concluded

services by hiring registered pharmacists “who are as good as those in the international health-care service industry.” For over 14 years in the operation, the company has grown to over 1,300 employees, with projects and accounts in the US, Australia, New Zealand and Japan, among other countries. Coronel, a president of the Philippine Software Industry (PSIA) for three years, was considered one of the pioneers of IT outsourcing in the Philippines. One of her goals is to strengthen the capacity building of the industry. “I always knew and recognize the talents and resources we have, so I focus my energy to develop programs to have our IT industry be recognized globally.” The talent and passion of Filipino workers in the IT-BPO business are among the key factors that have made the country as a world-class BPO hub. “Our employees are definitely our strength and our country has a lot of outstanding talents,” she said. “Our business started with our clients only outsourcing low-level tasks. Eventually, as we progressed and

proved our capabilities, clients started to value our services and to outsource tasks up to the value chain. Pointwest has always been trying to shatter glass ceilings, aiming higher. This helped us become more attractive and competitive in the industry,” she said. Through the Department of Trade and Industry’s Export Marketing Bureau, Coronel participated in several trade missions to the US, Asia Pacific and Europe. This also contributed to the expansion of her company’s accounts across the globe. “It helps the industry to have a government that is very supportive,” she said. Pointwest continues to expand with the aim of “serving the nation” by means of reaching those who do not have access to hospitals. Coronel admits, “We still need to have a strong partner which will help us reach the population who does not have sufficient access to healthcare.” Combined with her endearing ambitions and her company’s vision, Coronel successfully established a company that showcases world-class Filipino talent.

A10 Wednesday, April 26, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Asean Economic Community: Still a work in progress

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he Asean is holding its 30th summit meeting in Manila to assess the progress of the Asean Economic Community (AEC), launched two years ago in Kuala Lumpur. Seen as an ambitious plan to integrate the mostly struggling economies of the 10 Asean member-countries, the launching of the AEC in 2015 was greeted with much scepticism.

But what the AEC has accomplished in the last two years are truly phenomenal and remarkable, considering the awesome problems and challenges it has to hurdle. The lack of adequate infrastructure facilities in most of its members, their varied trade facilitation policies and practices, and the marked differences in political ideologies, cultural traditions and religious beliefs are just among the problems the architects of the economic integration plan hardly reckoned with. What is surprising is that these obstacles turned out to be the most compelling reasons the nations involved are determined to make their region a single market. What is even more inspiring is that Asean members are discarding worn-out traditions, quickly adopting the rapid and radical advances in digital technologies, and even tinkering with their political principles and attachments. The ideological sea changes in Vietnam and Myanmar are dumbfounding. The growing preference for the strongman role in Thailand and the Philippines, though disturbing, is gaining adherence. In all seminars, workshops and meetings on the ministerial, technical and professional levels and in cultural and sports events, the Asean delegates readily participate in the proceedings or in the games without any ideological, cultural or religious baggage. There is immediate rapport, respect and understanding for each other. There are certainly many more problems that will impede the integration process. But the imperative need for unity, collective survival and progress among the members is strong and pervasive. The harsh realities in the international economic order will prompt the Asean to sharpen its competitiveness in the world market. The combined GDP of the 10 Asean members is already third in the Asian region and seventh in the world. With free tariffs and free travels within the community, the over 650 million citizens of Asean will be a huge market among themselves and to other countries. We are confident that the AEC will overcome its complex problems and challenges and will solidly become a single market that will be as competitive as that of the European Union, China, India, Australia, Canada and the US. The citizens of the Asean are spirited and driven by their shared hardships and sufferings in colonial days. Endowed with enormous marine and land resources, this new economic bloc will emerge as the most progressive and wealthiest community in the global village. Given the challenges it has yet to overcome, however, the AEC is still a work in progress. Since 2005

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INSURANCE FORUM

he Financial Sector Forum (FSF) was established through a master memorandum of agreement (MOA) signed on July 5, 2004, by the heads of four financial regulators: Governor Rafael B. Buenaventura of the Bangko Sentral ng Pilipinas (BSP), Chairman Lilia T. Bautista of the Securities and Exchange Commission (SEC), Commissioner Eduardo T. Malinis of the Insurance Commission (IC); and President Ricardo M. Tan of the Philippine Deposit Insurance Corp. The chairman of the FSF is the governor of the BSP. Unlike in other jurisdictions where a single entity regulates the entire financial system, such as the Monetary Authority of Singapore (MAS), regulation in the Philippines and regulatory legislation are fragmented. Thus, it can be said that the FSF is a system-wide attempt at a consolidated approach to supervision. The FSF is a voluntary endeavor of the four agencies “to provide an institutionalized framework for coordinating the supervision and regulation of the financial system while preserving each agency’s mandate” and to provide a “venue for the agencies to update each

other on the latest developments in their respective industries and any concerns that may have systemic repercussions”. H av i n g b e e n e s t a b l i s he d through a mere MOA, it does not have any powers nor is it a “regulatory superbody”. It does not have

The Jane Addams model

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By David Brooks | New York Times News Service

hese days, everything puts me in mind of Jane Addams. Many of the social problems we face today—the fraying social fabric, widening inequality, anxieties over immigration, concentrated poverty, the return of cartoonish hypermasculinity—are the same problems she faced 130 years ago. And in many ways her responses were more sophisticated than ours.

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Financial Sector Forum

Addams was born to an affluent family in Cedarville, Illinois, in 1860. She was a morally ambitious young woman who dreamed of some epic life of service without much idea about how it might come about. In her teenage years, she earnestly set to reading—Pilgrim’s Progress, Plutarch’s Lives, The Decline and Fall of the Roman Empire—but in her 20s she was one of those young people who don’t get to themselves quickly. They spend years in study and in acquiring degrees with a vague sense they are preparing for something, without actually leaping into what it is they might want to do. Addams took a Grand Tour of Europe and found herself in a vegetable market, as the leftovers were being tossed to a crowd of paupers, who stood with their grasping hands upraised. The image had a powerful effect on her. Forever after, the sight of hands raised up, even in dance and calisthenics, caused her to feel the pain of poverty and want. In London, she visited a place called Toynbee Hall, a settlement house where rich university men

organized social gatherings with the poor in the same way they would organize them with one another. Addams returned to Chicago and set up Hull House, a US version of the settlement idea. As today, it was a time when the social fabric was being torn by technological change. Addams moved her family possessions, including the paintings, books and heirloom silver, into a large mansion in a blighted district. The idea was to give the dispossessed the same sort of refined and cultivated home environment that she had known, and thus, create a network of family and neighborly bonds. Before long, 2,000 a day were streaming through the place, taking and teaching courses, offering and receiving day care, doing the housekeeping, conducting sociological research. This was not rich serving the poor (Addams hated paternalism). It was rich and poor, immigrant and old stock, living and working in reciprocity, and as a byproduct bridging social chasms and coming to understand one another. For example, Addams thought it was especially

nation. Third, undertake initiatives on consumer protection and education. In all of these, the four agencies continue to be guided by relevant international standard organizations, such as the Basel Committee for banks, the International Organization of Securities Organizations for securities and the International Association of Insurance Supervisors for insurance companies. With the four agencies working hand in hand, a more robust and stable financial system can be expected. In April 2006 the FSF members signed a MOA on information exchange, laying down the procedures for sharing relevant information among the four members. It has also issued, for example, public advisories on pyramiding financial investments as part of its campaign to educate consumers. The FSF meets on a bimonthly basis with top management of the four agencies as core participants.

any legal mandate. Moreover, existing MOAs between any of the four agencies would still continue. It is a consultative and coordinating body. The FSF is focused on three specific broad areas. First, the harmonization and coordination of supervisory and regulatory methods and policies. This is vital where there are overlapping functions or where there are issues that cross over to differing financial sectors. An example where regulation can crossover is in the field of bancassurance or cross-selling, both regulated by the IC and the BSP. Another example is in the regulation of hybrid products issued by insurance companies, specifically insurance products with investment components, also known as variable life or unit-linked products (VULs), both regulated by the IC and the SEC. Indeed, there are instances when lines delineating financial regulations have become blurred. It is also vital in addressing “regulatory gray areas”. Second, the reporting and information exchange and dissemi-

Atty. Dennis B. Funa is the current insurance commissioner. Atty. Funa was appointed by President Duterte as the new insurance commissioner in December 2016. E-mail: dennisfuna@yahoo.com.

important to put immigrant adults into the role of teachers, because it affords “a pleasant change from the tutelage in which all Americans, including their own children, are so apt to hold them”. There were classes in acting, weaving, carpentry, but especially in art history, philosophy and music. Addams was convinced that everyone longs for beauty and knowledge. Everyone longs to serve some high ideal. She believed in character before intellect, that spiritual support is as important as material support. And yet, “the soul of man in the commercial and industrial struggle is under siege”. High culture was her way to elevate the desires and tastes of all who passed through. Residents were surrounded with copies of Rembrandts and presented with Greek tragedies and classical concerts. One new immigrant walked in and Addams handed him an Atlantic Monthly and recommended an essay he could barely understand. But it was a sign of respect and equality, and access to a different world. Even poor kids, she believed, should “share in the common inheritance of life’s best goods”. Our antipoverty efforts tend to be systematized and bureaucratized, but Hull House was intensely personalistic. She sought to change the world by planting herself deeply in a particular neighborhood. She treated each person as a unique soul. Addams had amazing capacity to

work from the specific case to the general philosophy, and had the ability to apply an overall strategy to the particular incident. There are many philanthropists and caregivers today who dislike theory and just want to get practical. It is this sort of doer’s arrogance and intellectual laziness that explains why so many charities do no good or do positive harm. Addams, by contrast, was both theorist and practitioner. In her day, like our own, public life was dominated by manly men who saw politics as a competition between warriors and who sought change through partisan chest thumping and impersonal legislative action. Addams was certainly political, but she defended the primacy of the “woman’s” sphere. People are really shaped by dense intimate connections. People thrive in “familied contexts”. As Jean Bethke Elshtain wrote in her biography, “The world of women was, for her, a dense concoction of imperatives, yearnings, reflections, actions, joys, tragedies, laughter, tears—a complex way of knowing and being in the world.” Tough, Addams believed that we only make our way in the world through discipline and self-control. Tender, she created an institution that was a lived-out version of humanist philosophy. In today’s terms, she was a moral and religious traditionalist and an economic leftist, and an incredible role model for our time.

Opinion BusinessMirror

opinion@businessmirror.com.ph

The average person today really isn’t Rockefeller rich

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Philippine statement at the UN Alliance of Civilizations Group of Friends meeting

By Barry Ritholtz | Bloomberg View

Teddy Locsin Jr.

Free fire

ou are not poor; income inequality is a myth; the middle class is doing just fine. That seems to be the message coming from numerous right-leaning think tanks, web sites and authors.

I was reminded of this yet again over the weekend, when I saw another attempt at telling the poor how lucky they are to be alive today. The title of the piece in question says it all: “You Are Richer than John D. Rockefeller”. Note that last time out, the poor were told they were richer than France’s Louis XIV, which we debunked. There are any number of ways to expose the fallacy of this claim, but I really want to focus on one of them: the role of luck in personal success or failure. Wealth, as we have observed before, is a relative concept. We measure our economic well-being by looking at our peers, not at different eras in time or geographies far away from us. The second point is that we can measure wealth in a variety of ways that are not simply based on income or financial assets: health, education, leisure time, life span and personal security. Next, if we do indulge in one of these time-travel thought experiments, we must acknowledge that time is bidirectional. Thus, the richer-than-Rockefeller argument implies that the wealthiest people today should be willing to switch places with a poor person a century or two in the future, when presumably we will all live longer, healthier, happier lives with technology we can’t even imagine today—and on and on. It is a most dubious proposition. But back to luck. This may be the biggest philosophical difference between the right-leaning think tanks and more rational, evidence-based outlooks less dependent upon a rigid belief system. As Michael J. Mauboussin, head of global financial strategies at Credit Suisse, explains in The Success Equation: Untangling Skill and Luck in Business, Sports, and Investing, skill and luck are “hopelessly entangled”. Everyone possesses different levels of skill, and we are all subject to outcomes that are based on luck. We also are not very good at distinguishing between the two. How large a role chance plays in determining outcomes may be variable but it is also significant. Once we acknowledge how much of our individual success or failure can be at the mercy of random fortune, it changes the usual assignment of causation and blame. In other words, this has big ramifications for those who believe we live in a meritocracy.

Wealth, as we have observed before, is a relative concept. We measure our economic wellbeing by looking at our peers, not at different eras in time or geographies far away from us. The second point is that we can measure wealth in a variety of ways that are not simply based on income or financial assets: health, education, leisure time, life span and personal security. A surprising thing I learned from interviewing some of the most successful people in finance is how frequently they credit good luck. Indeed, in most of the almost 150 Masters in Business interviews I have done, our guests mention—unprompted by me—the crucial role of serendipity. This isn’t false modesty or humility, but rather, an honest acknowledgment that chance can make a significant difference in people’s lives. Note that the role of chance doesn’t imply successful people don’t need to be educated, smart and diligent. Rather, it recognizes that lots of insightful, intelligent, hard-working people may not achieve the same level of success as other folks with the exact same qualities—and that those who are more successful may have had lucky breaks that others didn’t get. Once we take luck into our calculus, it creates problems for those enamored of Ayn Rand’s philosophy. It means some people succeed as a result of random chance, and that they will be mixed in with those rewarded based on merit—and that telling them apart isn’t always so easy. Similarly, by acknowledging the role of chance, we recognize why some people struggle. These people could use an assist, be it free lunches for poor kids who do much better in school when their nutritional needs are met or technical retraining for those whose industries have been displaced. Luck matters, and those who oppose all forms of government intervention seem to ignore this. It isn’t my job to play the role of official arbiter of erroneous reasoning on the Internet; there are more interesting things to write about. However, some poorly reasoned or misleading commentary demands a response. The claim that today’s poor aren’t really poor is one of those.

Continued from A1

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pengler had the opposite view. Civilizations are each sui generis and incommunicable. They cannot understand or learn or profit from each other. An encounter of civilizations is like ships with their lights out passing each other in the night, risking collision. Spengler’s vision inspired the First and Second World Wars.

Toynbee’s vision was of encounter and even clash, with threat of harm, yet also the possibility of meeting on common ground for mutual enrichment. After 9/11, Spengler’s vision returned with a vengeance as Huntington’s Clash of Civilizations. And, in

New York Times News Service

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virulent nationalism, tinged with bigotry, is on the rise across much of the world. It helped elect Narendra Modi in India and sustains Vladimir Putin in Russia. It has vaulted Marine Le Pen to the final round of the French election. She is the underdog in the runoff, but it’s chilling to see that this weekend she seems to have won voters under age 34. In the US Donald J. Trump won the White House, despite—and partly because of—his disdain for Mexicans, Muslims and AfricanAmericans and his flirtation with anti-Semitic tropes. In the face of this ethnic nationalism, citizens often face difficult choices. They have to decide how much of a priority to place on combating it. Should voters eschew their favorite candidate and vote for one

with the best chance to defeat the nationalist? Should policy experts be willing to work in an administration that plays footsie with intolerance? Should a museum dedicated to fighting hate, like the US Holocaust Memorial Museum, host a hateful president? These choices often end up being more complicated than they first seem, and I don’t want to suggest otherwise. But a disturbing pattern is still emerging. Too many people—well-meaning people on both the left and right—have grown complacent about nationalist bigotry. They are erring on the side of putting other priorities first, and ethnic nationalism is benefiting. Let’s start on the political left. And, no, I’m not about to lapse into false equivalence. Ethnic nationalism is largely a force of the right. But the left needs to decide how to respond, and it hasn’t been effective enough so far. It has underestimated

as short a time, that notion led to wars. The renewal of this dark vision encouraged a willful incomprehension and a cultivated intolerance. Not peace and progress, but war and devastation followed its publication. When you believe that differences can only interact with violence, any

encounter must produce less than either side had before, if the encounter leaves anything behind at all. But 12 years ago The Group of friends of the UN Alliance of Civilizations combined to explore and encourage the fruitful possibilities of meeting and exchange. There are combinations inspired by the advantage of sheer number. But no combination is so strong as one born of a shared belief in a common humanity, so it rises to the level of a personal conviction that defending others is no different than defending the humanity in oneself. The strongest defense is self-defense. This is the vision of the friends of the UN Alliance of Civilizations. Today the challenges are not of this or that time or place, but of the entire planet. In an interdependent world, what happens anywhere produces consequences everywhere. It is increasingly clear that solutions

to problems of every country, culture, or civilization are, in part, to be found outside itself in other countries, cultures and civilizations. An alliance of civilizations is only the plain logic of living or perishing in a world too small for war, but quite commodious for the myriad promises of peace. Secretar y- General A ntonio Guterres declared 2017 the “year of peace” with more hope than realism, I think. He also borrowed the word “surge”, which is associated with a renewal of force. But he turned it on its head when he called “for a surge in diplomacy for peace”. I do not know if history will remember this alliance for its role in the unfolding narratives of war and peace. But we are a part of a compelling story of hope and healing, and of such peace—in, however short or long, wide or narrow a time and place—that we helped achieve. Thank you.

Can Duterte break the ‘Sisyphus syndrome’? Michael Makabenta Alunan

on the contrary

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he Philippines had been likened to Sisyphus of Greek mythology, who was punished to eternity by Zeus to push a huge boulder up a hill, only to slide back to the bottom before reaching the top. Thi Sisyphean, or “Sisyphus syndrome”, describes how we often rise with a strong sense of nationhood during momentous events, like the People Power Edsa Revolution of 1986, only to slide back again and, worst, act like stupid lemmings racing to their death into the sea. n High growth, but worst poverty? While we brag to have posted among the highest growth rates in Asia at 6 percent in 2016, besting Indonesia’s 5.2 percent, Malaysia’s 4.6 percent, Thailand’s 3.1 percent, Vietnam’s 5.9 percent, Singapore’s 2.4 percent and Brunei’s 0.5 percent, according to Organisation for Economic Co-operation and Development statistics, this is empty braggadocio. For one, less-developed neighbors are growing much better, with Cambodia at 7.1 percent; Lao PDR, 7.0 percent; and Myanmar, 8.2 percent. An Asian Development Bank (ADB) study done on 51 developing countries noted that for every 1-percent increase in income, poverty drops by 1.5 percent or even as much as 2 percent among Asian countries, except the Philippines.

The urgency of ethnic nationalism By David Leonhardt

Wednesday, April 26, 2017 A11

the threat and put smaller matters ahead of larger ones. After France’s first round of voting, the leftist candidate Jean-Luc Mélenchon refused to endorse the last person who can prevent Le Pen from becoming president, Emmanuel Macron. A Le Pen presidency, to be clear, would likely tear Europe asunder, marginalize French citizens who hail from Africa and the Middle East and lead to a big expansion of security forces. It would be the biggest victory for Europe’s far right since World War II, by far. Yet, Mélenchon still won’t back Macron—a centrist former banker who was until recently a member of the Socialist Party. It’s a classic case of political purism that may feel good, but can do grave damage. Just look at the US. Updated presidential-vote totals show that Trump’s margins in Michigan, in Pennsylvania and in Wisconsin— which together would have swung the result—were smaller than the

From 2004 to 2009, for instance, our GDP grew by 4.9 percent, but poverty even increased to 26.5 percent in 2009. n Golden age of infrastructure. With Dutertenomics spelled out concretely as the “Golden Age of Infrastructure” by Neda Chief Ernesto M. Pernia and Budget Secretary Benjamin E. Diokno, there is hope the Duterte administration can break the Sisyphus syndrome. About P8.4 trillion will be spent on massive infrastructure alone within Duterte’s term. This will string together remote regions and islands, making them more accessible to outside markets, investments and tourism. Diokno says it is an opportune time to finance infrastructure, as interest rates on foreign borrowings are now as low as 0.25 percent. To avoid the risks of future peso devaluations, when we are made to pay more pesos for the same dollar of debts, perhaps it is advisable to also tap local funding, as domestic savings rate as of 2015 are as much as 30.3 percent of gross national income, while gross capital formation rate was only 19.8 percent.

Too many people—well-meaning people on both the left and right—have grown complacent about nationalist bigotry. They are erring on the side of putting other priorities first, and ethnic nationalism is benefiting. tally of Jill Stein, the Green Party candidate. It’s impossible to know whether Stein’s campaign cost Hillary Clinton the election, yet it clearly hurt. In a very close race, parts of the American left aided Trump. I understand that this point enrages backers of Stein and Mélenchon. They have real differences of opinion with center-left candidates, and they want to win those debates. But the final round of an election that includes a viable white nationalist isn’t a time to hash out the future of progressive politics. It’s a time to defeat racism. A version of this dilemma also applies to the political center. Apolitical

This means most surplus savings are just held unproductively in private commercial banks, but can be tapped for rural infrastructure with matching government guarantees and serve as a better compliance to the agri-agra loan law, which requires banks to lend 25 percent of their portfolio to agriculture, but allowed to buy T-bills as a form of paper compliance. n Agriculture and physicalwealth creation. Financial growth without physical-wealth creation does not create jobs. Infrastructure is a good start but, to be more inclusive, we need to develop agriculture, where two-thirds of people living below the poverty line are based, and, thus, stop massive rural-to-urban migration of rural folks escaping the clutches of rural misery, only to end up shackled in urban poverty. Records show that rural poverty in the Philippines only dropped by 14.7 percent over 14 years, from 46.9 percent in 2000 to about 40 percent in 2014, making us miss our Millennium Development Goals of halving poverty and still the highest ruralpoverty incidence in Asean. In contrast, Thailand, which focused on agriculture, reduced rural poverty by 73.2 percent in only 12 years, from 51.5 percent in 2001 to 13.9 percent in 2013. Rural poverty in other Asean countries also did better than us, with Indonesia’s rural poverty down to 13.8 percent in 2014; Vietnam down to 17.4 percent in 2010; and Malaysia to 8.4 percent as early as 2009. n Duterte must heed FVR. One stumbling block that is plaguing Duterte is his foul mouth, which suffers from oral diarrhea and footin-mouth disease. The problem is

that what he says is taken as policy pronouncement. This is where he needs to listen to former President Fidel V. Ramos, who just launched his book authored by friend Mel T. Velasco, entitled RPDEV @15: Our Continuing Voyage for Enduring Peace and Development. Duterte must also welcome the press as the public’s best feedback mechanism. Inherently, there is this symbiotic, but antagonistic, relationship between the government and the press, as officials hate it when they are misquoted, but the press loves it when officials get things wrong. Moreover, the press will not write much about the achievements of officials, because that is their job, but will play it up when they are not doing their jobs. People appreciate him for his efforts to wipe out drugs and corruption, but are wary about extrajudicial killings (EJKs). It is true that there are destabilization moves from opposition groups and druglords themselves, who are riding on legitimate issues, but it is partly because of Duterte’s tolerance for excesses of his police force, and his minions and trolls in social media that all forms of killings have been lumped as EJKs, an issue now escalating in the international scene. FVR wants to remind Duterte that his 16 million votes is not yet majority and his ratings have been declining. It is not yet too late for Duterte to shape up, but he must learn from Sisyphus, who was known for his avarice, deceitfulness, hubris and also took pleasure in killing travelers and guests to maintain his ironfisted rule, which infuriated Zeus.

institutions have to decide whether they will treat ethnocentrists, like Trump and Le Pen, differently from other politicians. These institutions are right to resist becoming part of “the opposition”, because society needs nonpartisan institutions. But they also have to avoid compromising their mission. The Holocaust Museum has put itself in a tricky spot. It invited Trump to give a major speech on Tuesday morning, much as previous presidents have done. Of course, previous presidents didn’t retweet neo-Nazi sympathizers, vilify Muslims or try to airbrush Jews out of the Holocaust. Maybe the museum’s leaders are confident Trump will use the speech as a turning point, which would be wonderful. But by conferring the museum’s prestige on Trump, those leaders have a new responsibility to call out future dog whistles from the administration. The Holocaust Museum has

effectively invested in Trump. Finally, there is the political right. Most Republicans despise the notion that their ideology makes room for bigotry. Theirs is the party of Lincoln and of individual freedom, they say. Fair enough. But that history brings responsibilities. Today’s Republican Party has plainly made room for white nationalism, via Steve King, Steve Bannon, Jeff Sessions and Fox News, not to mention the president. If the Holocaust Museum is now invested in Trump, Republicans are really invested in him and his fellow nationalists. You don’t get to call yourself the party of Lincoln and stay silent when voting rights are abridged, hate crimes are met with silence and dark-skinned citizens are cast as un-American. I never expected to live through a time when bigotry would again be as ascendant. But we are living in that time, and it brings a new set of choices.

E-mail: mikealunan@yahoo.com

2nd Front Page BusinessMirror

A12 Wednesday, April 26, 2017

Exports, consumer spending likely boosted Q1 GDP–report

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By Cai U. Ordinario

@cuo_bm

he country’s local output or GDP growth in the first quarter likely reached 7 percent on strong domestic consumption and hike in exports, according to the latest report from a local think tank. In its latest Market Call, First Metro Investment Corp.-University of Asia and the Pacific (FMICUA&P) Capital Markets Research said GDP growth may have settled at a range of 6.5 percent to 7 percent in the January-to-March period. “We expect the economy to expand by 6.5 percent to 7 percent in Q1 [first quarter], with exports providing the additional booster

6.9%

to robust domestic demand,” the report read. “Supporting [domestic demand] would be strong consumer spending, as OFW [overseas Filipino workers] remittances continued to increase [especially in peso terms] and manufacturing-sector vitality remained intact,” it added. The Philippine Statistics Authority will release the official GDP data next month. Since the start of 2017, the country’s export growth has been in

double digit at a 40-month high of 24 percent in January and 11 percent in February. Export earnings reached $4.782 billion in February, up from $4.31 billion recorded a year ago. The hike in the country’s exports was supported by the expansion in factory output, which grew by 10.7 percent year-onyear in February and 9.3 percent in January. “Exports growth in January suggests improving global demand, and we believe that this

trend will continue in the coming months, which should add vigor to the economy,” the report read. Further, the government’s massive infrastructure-spending plans may have stimulated GDP growth in the first quarter. The think tank said big-ticket projects, such as the Calax Expressway, the Metro Rail Transit (MRT) 7 and the Cebu International Airport expansion will boost GDP. See “Exports,” A2

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SOURCE: STR GLOBAL

“The hotels are fantasizing they are [attracting] high-yielding tourists, willing to pay their high rates,” Clemente pointed out to the B usiness M irror, shortly after meeting with officials of the Department of Tourism (DOT). Rajah Tours lost 380 Japanese tourists who were supposed to go to Cebu for a vacation but were unnerved because of the travel advisories. Clemente estimates that her agency lost about P30 million from the cancellations of this particular tour group. (See “DOT still confident of meeting 8 million arrivals target despite Bohol cancellations” in the BusinessMirror, April 22, 2017.) Canada, Australia, New Zealand and Japan issued travel advisories against the Philippines days before the Holy Week, leading to the cancellations. For her part, Tourism Secretary Wanda Corazon T. Teo, after meeting with tourism stakeholders last week, said she would meet with the hotel associations again to request them to drop their rates “in times of crisis”, just to encourage tourists to come to the Philippines. The other industry stakeholders that backed Clemente’s call for hotels to lower their rates during their meeting with DOT officials included representatives from the Philippine Tour Operators Association, National Association of Independent Travel Agencies and the Philippine Travel Agencies Association. “When I spoke to my counterpart in Thailand recently, I asked him how he dealt with the political crises and other issues that have cropped up, which may have deterred foreign tourists from visiting their country. He told me that they immediately cut their prices, especially the hotels. He said, never mind that they sell the rooms even at a loss; what’s important is that they get the tourists to come back to Thailand,” the DOT chief stressed. Aware of the country’s hotels resistance to cutting their rates, she said this was

LOPEZ: “If ever there are initiatives to work on an FTA, we’ll be open to that, but we won’t be bringing it up.”

@c_pillas29

The GDP growth projected by the World Bank for the Philippines this year

why she always appealed to foreign businessmen to invest by opening hotels in the Philippines. “When they come here, there would be more hotels built, thus lowering the prices of rates.” Earlier in her appointment to the DOT’s top post, Teo said she wanted to standardize hotel room rates to be able to compete with the likes of Bali and Bangkok. (See “Teo to lower room rates to hike arrivals”, in the BusinessMirror, July 2, 2016.) This is not the first time an appeal has been made to Philippine hotels to lower their rates, which is considered among the highest in the Asean region. Even Teo’s predecessor, Ramon R. Jimenez Jr., had tried to get hotels to cut their rates. “We are seen as a very high-end option. Mahal nga ang Pilipinas e! We’re actually more expensive than Thailand. For some reason, the local operators believe that the quality of the services is such that they can get away with a premium, and so far so good. During the peak season, it’s not a problem…. But I have to convince them [hotels and resorts] during the off-season ‘magbaba naman kayo ng presyo,’” he said in an interview in the first months of his tenure at the DOT. But his overtures were rebuffed by hotel owners, who said they do drop their rates during the lean season. A January 2016 report by STR Global showed that the average daily rate (ADR) of hotels in the Philippines has risen from P5,360 ($107.20) in 2013 to almost P5,700 ($114) in 2016. (The BusinessMirror exchange rate at P50:$1) Average hotel occupancy has been almost steady for the three-year period, from 64.5 percent in 2013, 67.6 percent in 2014 and 67 percent in 2016. The same report also indicated that the ADR of Philippine hotels has bumped up by 65 percent, compared to its other Asian neighbors, like Indonesia (+55 percent), Malaysia (+almost 60 percent), Thailand (+60 percent), and Japan (less than 65 percent).

PHL not in a hurry to ink FTA with US

By Catherine N. Pillas

Travel firms, DOT chief ask hotels to lower rates

Continued from A1

www.businessmirror.com.ph

craftmen’s best A woman checks on a wide variety of decorative lighting fixtures at the Manila FAME, a lifestyle and design event aiming to open doors for local and international buyers of the country’s premium home, fashion, holiday, architectural and interior products. The event is hosted at the World Trade Center in Pasay City. ALYSA SALEN

ammering out a bilateral freetrade agreement (FTA) with the US is not a priority of the Philippines, despite its decision to withdraw from the Trans-Pacific Partnership (TPP) talks, a Cabinet official said on Tuesday. Trade Secretary Ramon M. Lopez confirmed that talks on a possible FTA will not be on the Philippines’s agenda, when US President Donald J. Trump visits the country for the US-Asean Summit in November. “We have a generalized system of preferences [GSP] with the US, and that still stands. If ever there are initiatives to work on an FTA, we’ll be open to that, but we won’t be bringing it up. We’re comfortable and happy with the GSP,” Lopez said on the sidelines of the Management Association of the Philippines’s membership meeting held on Tuesday. The GSP is a trade privilege scheme that allows the duty-free entry of select Philippine products to the US market. Data from the US International Trade Commission (USITC) showed that the US imported $10.2 billion worth of Philippine products in 2015. Of the import bill, $1.3 billion worth of Philippine products were covered by the GSP. The top 10 Philippine exports subject to GSP treatment in 2015 were valued at $504.3 million, which would have been slapped most-favored nation tariff rates, ranging from 2 percent to 14.9 percent. While 3,500 tariff lines are eligible for GSP, the Philippines was able to seek GSP privileges for only 586 tariff lines, lower than Thailand’s 1,060 and India’s 1,800. The withdrawal of the US from the TPP has practically closed the route for the Philippines to gain wider and more permanent access to the American market. Trump has earlier expressed his preference to negotiate only bilateral agreements, in contrast to his predecessor, who was more partial to multilateraltrade arrangements. However, expansive and multicountry trade pacts, like the TPP, meant that rules, such as those related to intellectual property and government procurement, are dictated by larger players. This often results in major adjustments on the part of less-developed countries belonging to multilateral-trade pacts. The Philippines is not a member of the TPP. From the outset, the Duterte administration appeared to be lukewarm to the idea of participating in the US-led trade deal. The Duterte administration was more partial to improving trade and diplomatic ties with China, one of the major buyers of Philippine farm products, such as bananas and mangoes.

Agri sector lost $4B to natural disasters in 10 yrs By Manuel T. Cayon Mindanao Bureau Chief @awimailbox

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AVAO CITY—The Philippine agriculture sector incurred as much as $4 billion in losses due to natural disasters, such as typhoons and drought, in the last decade, according to the Food and Agriculture Organization (FAO). Despite this, the FAO said in a statement that the Philippine Atmospheric Geophysical and Astronomical Services Administration (Pagasa) has yet to acquire technology that would improve its weather-forecasting capability. “ T he r ight infor mat ion at

the right time is the agriculture sector’s best defense against disasters and climate change. Our work with Pagasa is, therefore, very crucial to the success of our larger strategy for disaster risk reduction and management and climate-change adaptation for agriculture,” said José Luis Fernández, FAO representative in the Philippines. The FAO said the Pagasa of the Department of Science and Technology (DOST) “is increasing its access to advanced weather and climate-information products”. “The decision-support information and tools produced through our joint efforts form the basis of plans, policies, operations and

actions that will significantly influence the future of the country’s food and nutrition security, and its battle against poverty and climate change,” Fernandez said. T he U N u n it s a id it h a s worked with Pagasa since 2011 “to develop forecasts, project ions, fa r m-level adv isor ies, early warning systems and tools t h at s up p or t c l i m ate - s m a r t agriculture practices”. “One of the major milestones of the partnership is the recent launch of climate-change projections based on the latest climate models, which are being provided to different planning institutions of the government and the private sector, among others. These

include rainfall and temperature projections from 2020 to 2079,” the FAO added. The FAO said the Department of Agriculture’s (DA) regional field offices and local government units (LGUs) have recently developed short- and long-range climate forecasts to serve as “vital resource for farmers and fishermen”. Pagasa had also generated nineday climate forecasts to support farmer operations in over 100 municipalities nationwide. The FAO said these efforts were funded by the European Commission’s Humanitarian Aid Department and Japan’s Ministry of Agriculture, Forestry and Fisheries. See “Agri sector,” A2