Businessmirror August 06, 2018

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Monday, August 6, 2018 Vol. 13 No. 296

Tariffs on imported fish, meat may be cut by EO By Jovee Marie N. dela Cruz @joveemarie Butch Fernandez @butchfBM & Bernadette D. Nicolas

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@BNicolasBM

HE Palace and Congress have formed a consensus in support of at least five inflationbusting measures, including the reduction in tariffs on fish and meat imports, and officials are floating the option of having this done by an executive order (EO) when Congress takes a short scheduled recess from August 16 to 27. This, as leaders of the House of Representatives on Sunday backed the five economic measures championed by Speaker Gloria Macapagal-Arroyo to cushion the country’s soaring inflation. T he for mer president , a n economist, had sought a meeting

with the economic managers last week—an encounter sources said she billed as “from one professor to another”—in a bid to find firmer ways of arresting the steady increase in inflation, which many critics had blamed on the first part of the Comprehensive Tax Reform

Program, the TRAIN law. TRAIN, which stands for Tax Reform for Acceleration and Inclusion, took effect in January 2018, and lawmakers are hard put championing the next-wave reforms on account of the continuing blame game over TRAIN as inflation con-

“I think the Speaker just shared her ideas, but of course, it’s the economic managers who must decide what is feasible or not under the circumstances.”—Yap

tinues to rise. Last week the Central Bank said inflation in July could reach 5.8 percent. Earlier, House Committee on Economic Affairs Vice Chairman Joey S. Salceda of Albay said that in the meeting with the Economic Managers Group (EMG), Arroyo, together with key economic leaders of the House of Representatives, discussed measures to control inflation and bring immediate relief to ordinary working families and consumers.

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How about giving tax incentives to local PPPs? Alberto C. Agra

ead

L AlbertoPPP C. Agra

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or the past two weeks, this columnist has been writing about ways by which a local government unit (LGU) can support a public-private partnership (PPP) project—expropriating private property and promoting the general welfare via police power. The 1991 Local Government Code (1991 LGC) gave this power to LGUs, which was affirmed by Memorandum Circular No. 120, s. of 2016 (MC 120), issued by the Department of the Interior and Local Government. An LGU, under the template PPP ordinance attached to MC 120, “may extend goodwill, free carry, grant a franchise, concession, usufruct, right-of-way, equity, subsidy or guarantee, provide cost-sharing and credit-enhancement mechanisms, exercise police power, give tax incentives or tax holidays, perform devolved powers, expropriate and reclassify and enact or integrate zoning ordinances.” Continued on A11

BSP okays guidelines on adoption of PFRS 9 ‘Tariff-free meat, fish imports to harm local producers’ See “Tariffs,” A2

By Bianca Cuaresma

By Jasper Emmanuel Y. Arcalas

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@jearcalas

OG raisers and pou ltry growers have warned against removing tariffs on fish and meat imports to ease inflation, as this could “unduly harm” local producers, and the Department of Agriculture counseled caution in pursuing this strategy. Agriculture Secretary Emmanuel F. Piñol told the BusinessMirror that he supports the proposal of Speaker Gloria Macapagal-Arroyo to scrap tariffs on meat and fish imports. Piñol said, however, that the government must not “sacrifice” the farm sector just to halt the increase in food prices. “Yes, but we should not unduly sacrifice our farmers and fishermen,” the DA chief said via SMS when asked if he supports Arroyo’s proposal. See “Tariff-free,” A2

A fisherman fixes his banca over the weekend at Manila Bay in Pasay City. Local producers are chafing at a proposal to cut tariffs on imported fish and meat, as a way of busting inflation. Stakeholders said this would not necessarily reduce prices and would end up harming local sectors. ROY DOMINGO

PESO exchange rates n US 53.0080

@BcuaresmaBM

HE Bangko Sentral ng Pilipinas (BSP) has approved the adoption of a new standard for financial institutions, which aims to promote the integrity of financial reporting in the country. Over the weekend, the BSP announced that its monetary board green-lighted the guidelines on the adoption of the Philippine Financial Reporting Standards (PFRS) 9 - Financial instruments for Bangko Sentral-supervised financial institutions (BSFIs). According to the Central Bank, the new policy sets out the supervisory expectations in classifying and measuring financial instruments and in recognizing impairment to promote prudence and transparency in financial reporting. “In particular, the board of directors is required to assess the impact of PFRS 9 on business strategies

and risk-management systems to be able to adopt appropriate policies and control measures that will ensure integrity of the reporting process,” the BSP said in its statement on the approval of the new set of guidelines. “The Bangko Sentral also expects BSFIs to exercise sound professional judgment in implementing the provisions of the standards, considering that these are largely principles-based,” it added. The newly approved PFRS 9 is the local adoption of the International Financial Reporting Standards (IFRS) 9—an international accounting standard, that sets the bar on accounting for financial instruments. The PFRS 9 will allow the BSP to evaluate the consistency of sales activities and metrics being used in monitoring the performance of financial instruments with the business model for holding the instrument.

n japan 0.4748 n UK 69.0164 n HK 6.7531 n CHINA 7.7518 n singapore 38.7344 n australia 39.0033 n EU 61.4151 n SAUDI arabia 14.1347

See “BSP,” A2

Source: BSP (3 August 2018 )

News

BusinessMirror

A2 Monday, August 6, 2018

NFA must retain licensing power post-QR: Stakeholders

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By Jasper Emmanuel Y. Arcalas

@jearcalas

ARMER organizations and rice industry groups are urging the government to retain the licensing power of the National Food Authority (NFA) to prevent “disorderly manipulation” of imports and stocks of the staple.

Representatives of the Federation of Free Farmers, Centro Saka, Alyansa Agrikultura, Rice Watch Action Network, Paragos-Pilipinas, National Union of Rural Based Organization, Pambansang Katipunan ng Kababaihan sa Kanayunan, Ka Tribu Ug and Lasang Foundation and Cacao/Coffee Alliance issued a position paper outlining the groups’ stance on the removal of the country’s quantitative re-

Tariffs. . .

Continued from A1

He said the House under the leadership of Speaker Arroyo proposed to the EMG measures that were considered based on the magnitude of a commodity’s contribution to the July Inflation. Salceda said Arroyo wants the President to consider reduce tariff on fish and meat imports to zero but needs Congress to be in recess. Under its Legislative calendar, Congress will take a break on August 16 to 27. On Sunday Senate President Vicente C. Sotto III acknowledged the possibility of having tariffs for meat and fish imports reduced, through a Malacañang executive order, as an inflation-busting strategy while Congress is in recess. “Yes, possible,” the Senate President told the BusinessMirror over the weekend in reply to a query on whether he was consulted on Arroyo’s proposal to cut tariffs on these products. In fact, Sotto added, it is even possible that Malacañang might consider resorting to an Executive Order to hasten shift to a rice tariffication system“while Congress is in recess.” The long-awaited transition to rice tariffs, from the current quantitative restrictions (QR), is widely seen to help cut inflation which was higher than expected, and which has been blamed on the TRAIN Law. Congress members had been badgering economic managers to find ways to cut inflation because, they said, it will be hard for them to push the second package of tax reforms (TRAIN 2) for as long as people associate high prices with the so-called TRAIN 1.

Support from House leaders

Arroyo’s pitch of five inflation-busting measures to President Duterte, through his economic manager, got full support on Sunday from key committee leaders: Economic Affairs Chairman Arthur Yap of Bohol, Appropriations Chairman Karlo Alexei B. Nograles of Davao

Tariff-free. . .

City, Ways and Means member Rodel Batocabe of Ako Bicol and Banks and Financial Intermediaries Chairman Ben Evardone of Eastern Samar. “I guess she is just imparting lessons from her experience when during her presidency, she had to insulate the country from the effects of global food price spikes and the meltdown of the global financial markets due to the sub prime mortgage crisis,” said Yap, a former agriculture secretary during the Arroyo administration. “From 2008 to 2010 she primed the economy with infrastructure expenditures, instituted conditional cash transfers for the vulnerable sectors and ensured food inflation was in check,” he added.

EO? It’s Executive’s call

However, when asked if Arroyo will recommend to the President to issue an executive order to implement these measures, Yap said, “I think the Speaker just shared her ideas, but of course, it’s the economic managers who must decide what is feasible or not under the circumstances.”

Not sure-fire inflation buster

Not everyone in the House agrees with the strategies on the table, however. Akbayan Rep. Tom S. Villarin said reducing tariffs on imports of oil, electricity and food commodities would not cushion the impact of inflation as external factors like US federal interest rate hikes, rising global oil prices, and decreasing exports would offset such measures. “It will provide a buffer stock of goods for consumers but unstable government policies and jittery financial markets have also caused inflation not to taper down,” Villarin added. According to Yap, however, Arroyo is only drawing lessons from “that episode of her life” when she was president. “And the results bore her out. The Philippine economy continued to grow and expand in the last 10 quarters of her Administration,” he said.

Continued from A1

Piñol said he would convene the concerned sectors for a special meeting this week to discuss the Speaker’s proposal. Arroyo pitched to economic managers the removal of tariffs on meat and fish imports as the two items accounted for a total of 0.9 percentage point of the 5.2-percent inflation rate recorded in June. The tariffs currently imposed by the Philippines on meat products range from 10 to 40 percent, while fish imports are levied a duty of 3 to 10 percent. Last year the Philippines imported 716,944.619 metric tons (MT) of meat and meat products, according to data from the Philippine Statistics Authority (PSA). The fish and fish products imported by the country last year expanded by 39.25 percent to 411,969.235 MT, from 295,844.345 MT recorded in 2016.

‘Band-aid solution’

striction (QR) on rice. “We firmly believe that NFA should continue to license importers, in order to prevent disorderly manipulation of stocks and allow for a smooth transition to rice trade liberalization,” the five-page position paper read, a copy of which was obtained by the BusinessMirror. The groups said the NFA should not be abolished once the QR on rice is replaced with tariffs upon the

Economists told the B usiness M irror that Arroyo’s proposal is just a “short-term”measure to address inflation. However, the reduction in

tariffs could put local producers at risk. “They are short-sighted, short-term measures that don’t address the structural problems behind undue inflation—low agricultural productivity from government neglect and the peso’s secular decline from chronic trade deficits,” Jose Enrique A. Africa, executive director of IBON Foundation Inc., told the BusinessMirror. “Greater agricultural imports could even worsen the long-term situation by displacing uncompetitive producers and increasing our import bill,” Africa added. He tagged them “supply-side measures that will likely have more effect than interest rate hike and can momentarily reduce inflationary pressures.” Economist Pablito M. Villegas warned that only traders and middlemen will benefit from the removal of tariffs and this would not result in lower prices of goods. “There is a big price difference between the farm-gate price of local produce and retail prices. What is the assurance that with cheaper meat imports, retail prices would go down?” Villegas said.

passage of a rice tariffication law. In this regard, the groups pitched the need for a “legislated” mandate for NFA to maintain a certain volume of buffer stocks. “ We bel ieve t hat t he NFA should be retained, particularly its buffer stocking functions, to ensure that stocks will be available in case of calamities and emergencies,” they said. Furthermore, the groups urged the government to retain the NFA’s market distribution power but called for reforms in how the food agency conducts it. “At the same time, we recognize the need to reduce the losses of the agency while making its interventions more strategic and effective,” they said. “For example, NFA’s distribution of subsidized rice need not be conducted nationwide and could be concentrated in poor and depressed areas,” they added. The groups also threw their support to hiking the NFA’s buying price for palay in order for it to

replenish its buffer stocks through local procurement. “NFA could procure from farmers at competitive prices by periodically conducting auctions to replenish its buffer stocks, instead of buying at fixed prices.” The groups also proposed that the NFA “develop services that will plug gaps in the value chain.” This could be done by “giving farmers access to its post-harvest and marketing facilities, or developing a trading system that will allow farmers to store their produce in NFA warehouses and sell them electronically to buyers in various parts of the country,” according to the paper. “Steps could also be taken to reduce the operating costs of the agency and generate revenues from services without necessarily engaging in costly market intervention,” they said. Furthermore, the groups called for reforms within the NFA to weed out corruption and anomalous practices.

Other ‘inflation busters’

by Arroyo to combat inflation is to lower tariffs on fish and meat imports as the President has always wanted affordable food for Filipinos. “Ever since, President Rodrigo Roa Duterte wishes for food to be bought at an affordable price,” Presidential Spokesman Harry L. Roque, Jr. said in Filipino in a statement. “To cushion the impact of rising prices, pushing for lower tariffs on meat and fish imports is one of the proposed measures discussed during the recent meeting between President Duterte’s economic managers and Speaker Gloria Macapagal-Arroyo.” “The economic managers are happy to be continuing to be working closely with the leadership of the legislature,” Roque said. June inflation went beyond government expectations and hit a new five-year high at 5.2 percent, bringing the year-to-date average from January to June this year at 4.3 percent, slightly higher than the government’s target at 2 to 4 percent. July inflation is expected by the Bangko Sentral ng Pilipinas fall within the range of 5.1 to 5.8 percent. The inflation figure is expected to be released on Tuesday.

Salceda, meanwhile, said Arroyo also wants the National Food Authority to purchase 500,000 MT of well-milled rice with staggered deliveries over five to six months. Arroyo also proposed to the Department of Energy to consider deferring z-ethane required additional content in oil products as well as the new feed-in-tariff allowance which increased from P0.18 to P0.26/kwh as this alone contributed to a P3.16/kwh increase in Meralco rates, Salceda said. The lawmaker said the Bangko Sentral ng Pilipinas was also asked to study an additional 25 basis points (bps) rate hike after the two 25 bps already implemented, in order to cleanse the market of any potential speculative opportunistic content. For his part, Nograles said Arroyo and Duterte’s economic managers “see the wisdom” in giving this strategy a chance to work. “These things have been done before and they’ve worked in the past,” Nograles said. “Rice, fish and meat obviously form part of the basic food basket of our countrymen. If we can bring the prices down, that would temper inflation and the lower prices will be felt immediately and will be greatly appreciated by the public,” Nograles added. Also, he said finding a way to bring down the prices of oil and electricity will further slow down inflation and control the prices of commodities in the market, as well. Batocabe and Evardone, meanwhile, said they will support Arroyo as she is an economist. “The Speaker is an economic expert and I will defer to her good judgment. As such, she can be assured of my full support on these economic measures,” Batocabe said. For his part, Evardone said “I support it to give consumers a respite from the spiraling upward of cost of basic commodities.”

Malacañang: All ears on measures

Malacañang confirmed on Sunday that one of the proposed measures proposed

‘Let PITC do importation’

“The government must find a solution to tame inflation and make goods affordable to consumers without harming producers. The problem really is more on the price at the retail level,” he added. Villegas said the government could consider allowing the Philippine International Trading Corp. (PITC) to import meat and fish at zero tariff to cushion the impact on local producers. He said the PITC, an attached governmentowned and -controlled corporation of the Department of Trade and Industry, does not need an executive order to import products at lower tariffs.

‘Consultations needed’

United Broiler Raisers Association (Ubra) President Elias Jose Inciong said he understands the objective of Arroyo’s proposal but urged the government to conduct consultations before tinkering with the tariffs. “The problem is in the retail market, not in the production. We have sufficient supply. I hope that [Arroyo’s proposal] would go through a process of consultation so that we can determine the necessary steps that should

TRAIN 2’s fate

In a related development, Senate President Sotto said he was leaving it up to the chairman of the Ways and Means committee, Sen. Juan Edgardo Angara, to make the TRAIN2 bill a priority. Unlike TRAIN that imposed new taxes, this next round of reforms involves cutting the corporate income tax and rationalizing fiscal incentives. Asked by the B u s i n e s s M i r ro r if the committee is frontloading the TRAIN 2 bill in its priority list, Angara indicated it will be taken up along with other pending revenue-raising measures being lined up for plenary consideration. “We can start tackling other bills after the tax amnesty bill,” said Angara, adding he is hoping to sponsor the tax amnesty bill for plenary deliberations “within the next two be taken,” Inciong told the BusinessMirror. Broiler prices, however, are quite high during the July-to-September period due to the so-called third-quarter syndrome—a combination of factors that leads to lower production due to extreme weather conditions, according to Inciong. “It is not that we are against importation, but if there is a need for it due to lack of supply, institutional buyers and broiler raisers would usually complain first and propose importation,” he said. Farm-gate prices of broiler currently range from P94 per kilogram to as high as P100 per kg, depending on the size and area. “This is in accordance with the season. Our expectation, based on our records, is that prices would start to collapse in late-August until October,” Inciong said. If Arroyo’s proposal is approved without consulting stakeholders, broiler raisers may be forced to slash production, according to Inciong. “We will be constrained to recommend to our members cuts in production and for breeders not to restock, which would affect supply for a longer period. If that happens, you will have a more serious problem,” he said.

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BOI, on track to clinch ₧680-B goal, shrugging off fiscal perks reforms By Elijah Felice E. Rosales

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@alyasjah

HE Board of Investments (BOI) is expected to shrug off the looming rationalization of fiscal incentives, as it is on track to clinch its P680-billion target this year, a trade official has said. Trade Undersecretary and BOI Managing Head Ceferino S. Rodolfo Jr. said new investors will benefit from the second package of the Comprehensive Tax Reform Program (CTRP). He owed this to the rationalization of incentives, one of the two main principles of the measure, which he argued will level the playing field for potential and existing investors. “First of all, for those who are not yet here, they will have more advantage because, once tax incentives are rationalized, they will have a menu to choose from. Also, export and nationality biases will be removed, so [it’s] definitely better for the incoming investors that have no presence yet in our country,” Rodolfo told the BusinessMirror in a mix of English and Filipino. On the other hand, he said trade officials are consulting with existing investors—most of which are operating with fiscal incentives—on how the transition to a new tax regime should go about. The government’s pitch to them is that they could have availed themselves of more incentives only if the system were rationalized. “For those who have presence here, what we are discussing with them is the transition period, and we are emphasizing that registration [of tax incentives] is not by company, but by project. Therefore, for most of them, even those currently here, even in their current operations, they could have actually availed of more incentives had they been diligently registering their projects,” Rodolfo explained. The second CTRP package favors those who consistently invest, bring in new technology and whose projects generate employment, he added. “In fact, this is better because this is really by project. There will be [an] income tax holiday as long as you continue to reinvest; introduce new products [and] technology, then you can be given incentives,”

BSP. . .

Continued from A1

“This will align the accounting treatment with risk management strategies and is seen to strengthen governance over the reporting system,” the BSP said. The new standard also requires the adoption of the expected credit loss (ECL) in recognizing impairment. As such, local financial institutions will be required to recognize the allowance for

Hike in production cost

Pork Producers Federation of the Philippines Inc. (ProPork) President Edwin G. Chen said the government must recognize that the production costs incurred by hog raisers and poultry growers have gone up due to the increase in the price of raw materials. “I don’t think it is right to just single out the meat and fish sectors to solve inflation. The government should come up with a comprehensive solution to address the issue,” Chen told the BusinessMirror. “[Arroyo] always wants to sacrifice agricultural products like before. The real culprit is our rising fuel costs, power and weak peso,” he added. Chen urged the government to support the livestock and poultry sectors to bring down production costs and retail prices. He said government can consider allowing the dutyfree importation of corn and soybean meal. “The small backyard raisers and fishermen will need government support if the government would push through with zero tariffs for fish and meat imports. In the last three years, we saw an increase in our sow population and inventory. This shows that

Rodolfo said. With this, the trade official is confident the BOI will hit its investment target this year of P680 billion. In the first semester commitments to the agency grew to P238.9 billion, up by 27.1 percent from P188.02 billion during the same period last year, according to figures from the Department of Trade and Industry’s Bureau of Trade and Industrial Policy Research. This is worlds apart from what has been taking place in the Philippine Economic Zone Authority. Investment pledges to Peza declined to P53.07 billion from January to June, down by 55.9 percent from P120.22 billion during the same half in the previous year. Peza officials have been blaming the second CTRP package for the decline in investments. Existing locators are reportedly hesitant about expanding operations, while potential investors are holding on to their money, as tax incentives might soon be overhauled. Although the BOI is still nearly 65 percent far from its objective, Rodolfo said the agency will most certainly clinch it, as he anticipates fresh projects to come in the second semester. He also confirmed that four firms, with pledges ranging from P16 billion to P40 billion, will be registering with the BOI soon. The incoming firms belong to the infrastructure, transportation, heavy manufacturing and renewable-energy industries, according to Rodolfo. With the second CTRP package up for legislative debate, Rodolfo argued the country will not surrender investors in the process. He said what is critical for most investors is not only profitability, but also operational efficiency, which a revamped tax regime can bring. The House Committee on Ways on Means last week approved in principle the second CTRP package. A technical working group is now integrating all related bills in the lower chamber to come up with a consolidated version. The second CTRP package will slash corporate income tax to 25 percent from 30 percent, as well as rationalize incentives. It hopes to make tax incentives “performance-based, targeted, time-bound and transparent.”

credit losses even before the default or nonpayment of the borrower. The BSP said financial institutions with simple operations are expected to adopt simple loan loss methodologies fundamentally anchored on the principle of recognizing ECL. Meanwhile, other BSFIs with credit operations that may not economically justify adoption of a model will only be subject to the regulatory guidelines in setting up allowance for credit losses prescribed under an earlier circular of the BSP. the livestock sector will grow for as long as there is a level playing field,” he added.

‘Elbow room’

Meat Importers and Traders Association President Jesus C. Cham backed Arroyo’s proposal and urged the government to make the measure permanent. “I think allowing more access to protein, to good meat, aside from addressing inflation, will also have a lot of health benefits,”Cham told the BusinessMirror. The Philippines could capitalize on the low price of meat products in the international market, he added. However, he said importers would need “sufficient elbow room” for the imports to arrive in the country. It usually takes two to three months for shipments to arrive in Philippines after traders place the order. Pork prices are "at an all-time high, and it is not yet Christmas. Definitely, [reducing the tariffs] would entice more imports. Any reduction in duty will help us,” he said. Cham said the private sector, not the government, should undertake the importation. “It did not work out before, when they proposed that the government import products and sell these to us.”

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Govt, MILF discuss integration of ex-fighters into AFP, PNP By Rene Acosta

@reneacostaBM

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HE Department of National Defense (DND) is already working with the leadership of the Moro Islamic Liberation Front for the decommissioning of MILF’s forces and the possible integration of its qualified fighters into the Armed Forces of the Philippines (AFP) and the Philippine National Police (PNP). This was disclosed by Defense Secretary Delfin N. Lorenzana following the signing into law of the Bangsamoro Organic Law (BOL) by President Duterte more than a week ago. The MILF earlier said it will decommission its forces once the BOL is implemented. Just like in the peace agreement the Moro National Liberation Front signed with the government that created the Autonomous Region in Muslim Mindanao, it hoped its fighters would also be integrated into the military and police forces. “We now begin the very important step of implementing the provisions of the new law, including the decommissioning of MILF fighters, and the possible integration of qualified individuals to the AFP and PNP,” said Lorenzana in a statement, adding he was hoping the BOL will bring a new era of peace in Mindanao. “Together with our brothers and sisters in the Bangsamoro, we will show the world that violence and terror do not have a place in our communities, and as Filipinos, we can work together to achieve just and lasting peace,” he added. The defense secretary called on other forces still waging a conflict, including the New People’s Army,

“I am confident the root causes of violent extremism and terrorism, such as poverty, lack of education and social injustice will be adequately addressed.” —Lorenzana

to follow the lead of the MILF and the Moro National Liberation Front by negotiating for peace with the government. “Through our localized peace efforts, we remain committed to achieve peace, even with members of the Communist terrorist group, and pursue the peace agenda of our President who is walking the extra mile to unite the people as one nation,” he said. Lorenzana assured the Moros of the DND’s help as they start new lives under the BOL and for the government to heal the wounds of conflict and in ending the divisiveness in Mindanao brought by decades of fighting. He said w ith the development of commerce, trade and industr y in Mindanao, a long with the increased deliver y of government ser v ices to communities under the BOL, there should be no reason terrorism and violent extremism should not end in the region. “I am confident the root causes of violent extremism and terrorism, such as poverty, lack of education and social injustice will be adequately addressed,” Lorenzana said.

Interview of 5 Chief Justice applicants set on Aug. 16

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HE Judicial and Bar Council (JBC) is set to interview the five applicants for the position of Chief Justice on August 16. The post became vacant after Maria Lourdes A. Sereno was ousted by the Supreme Court en banc, voting 8-6, through quo warranto proceedings. The five candidates are SC justices Teresita Leonardo-de Castro, Diosdado Peralta and Lucas Bersamin, Andres Reyes Jr. and Judge Virginia Tejano-Ang of Tagum City, Davao del Norte Regional Trial Court Branch 1. “Public interviews for all nominees for the post of Chief Justice on Aug. 16, 9 a.m. onwards at the Division Hearing Room, SC New Building,” the SC Public Information Office (PIO) said on its Twitter account. Justice Secretary Menardo I. Guevarra, an ex-officio member of the JBC, in a text message sent to Philippine News Agency, said the JBC will hold its final deliberations and selection on August 31 for the shortlist of its candidates. It will then endorse it to President Duterte for approval. Three of the applicants—de Castro, Per-

alta, Bersamin—were automatic candidates for the post, being among the five most senior magistrates of the High Court. Acting Chief Justice Antonio Carpio, who did not apply for the post, will be the Acting Chairman of the JBC, while Associate Justice Presbitero Velasco Jr. declined to be included in the shortlist. He is set to retire on August 7. Reyes, who accepted the nomination for Chief Justice after being endorsed by former JBC member and retired Sandiganbayan Justice Raul Victorino, will also be interviewed by JBC members. Last Tuesday Bersamin got 10 votes from the SC en banc, followed by de Castro and Peralta with nine votes each, while Reyes garnered two votes. The results of the voting will be forwarded to the JBC. De Castro, Bersamin and Peralta were among the six justices who asked by Sereno to inhibit from the deliberation on the quo warranto petition filed by Solicitor General Jose C. Calida. The petition was eventually granted by the Court in a decision issued on May 11. The decision became final on June 19. PNA

Editor: Vittorio V. Vitug • Monday, August 6, 2018 A3

DU30 expected to sign national ID system Aug. 6

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By Bernadette D. Nicolas @BNicolasBM & Cai U. Ordinario @cuo_bm

RESIDENT Duterte is expected to sign into law on Monday, August 6, the measure seeking to establish the Philippine Identification System (PhilSys).

Both houses of Congress ratified the bicameral conference committee report on the last week of May. The ceremonial signing of the Philippine Identification System Act in Malacañan Palace will coincide with the presentation of Republic Act 11054 or the Organic Law for the Bangsamoro Autonomous Region in Muslim Mindanao, also known as the Bangsamoro Organic Law (BOL), according to the schedule sent by Malacañang to reporters. Meanwhile, the Philippine Statistics Authority (PSA) said the government will spend P4 billion billion to jumpstart the National ID system this year and next year. In an interview, National Statistician Lisa Grace S. Bersales told the BusinessMirror around P2 billion will be spent this year and P2 billion next year for the National ID. Bersales said of the P2 billion allocated for this year, around P1.4 billion will be spent to procure the system and P600 million will be for administrative costs. The system will be procured

through International Competitive Bidding (ICB), consistent with government procurement rules and regulations. The remaining P2 billion allocated for 2019 will be used for actual data capture and implementation of the National ID system. The President first announced he signed the BOL last July 26, days after his third State of the Nation Address. Both bills were priority measures of the Duterte administration. Once the Philippine Identification System Act is signed into law, all citizens and resident aliens of the country will be provided with a valid proof of identify as a means of simplifying public and private transactions. One year after the effectivity of the Act, every citizen or resident alien shall register personally in the registration centers. This proposed law also aims to eliminate the need to present other forms of identification when transacting with the gov-

ernment and the private sector, subject to appropriate authentication measures based on a biometric identification system. The Philippine ID shall contain the following information: the PhilSys number, full name, sex, blood type, marital status (optional), place of birth, photograph, date of birth and address. The PhilSys number is a randomly generated, unique and permanent identification number that will be assigned to every citizen or resident alien upon birth or registration by the Philippine Statistics Authority (PSA), which is also the primary implementing agency to carry out the provisions of the measure. For data privacy and security, the ID shall contain a QR code which contains some fingerprint information and other security measures, such as iris scan. Any information obtained as a result of unlawful disclosure under the Act shall be inadmissible in any judicial, quasi-judicial or administrative proceeding. Budget Secretary Benjamin E. Diokno earlier said the establishment of a national identification system will help improve the delivery of government services and reduce fraudulent transactions. Aside from the seamless delivery of services, the establishment of a single national identification system or the Philippine Identification System is also meant to improve the efficiency, transparency and targeted delivery of public and social services, enhance administra-

House ‘rushing’ creation of disaster-resilience dept By Jovee Marie N. dela Cruz

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@joveemarie

S the House of Representatives is now rushing the approval of Duterte administration’s measure creating a Department of Disaster Resilience (DDR), a lawmaker on Sunday called on Congress to put at least five government agencies concerned with disaster-risk reduction under one roof. House Committee on Appropriations Vice Chairman Rep. Luis Raymund F. Villafuerte Jr. of Camarines Sur said consolidating the functions of the Climate Change Commission, the National Disaster Risk Reduction Management Council, the People’s Survival Fund, Yolanda Recovery and Rehabilitation Efforts and the Office of the Presidential Assistant for Rehabilitation and Recovery would oversee all programs and activities to reduce the country’s vulnerability to natural calamities and climate change. Rather than bloat the bureaucracy by creating a new office with new personnel, additional maintenance and operating expenses, Villafuerte said the new DDR, as proposed by the President and the House of Representatives, could incorporate these five agencies as outlined under his proposal, House Bill 6131. “The government cannot achieve high and in-

clusive growth without making our country climate resilient. With the unfortunate distinction of being ground zero for climate disaster, the Philippines’s losses during the typhoon season amounts to around 2 percent of our gross domestic product, while reconstruction efforts after disasters costs another 2 percent of our GDP based on our estimates,” Villafuerte said. Villafuerte’s call was in response to the President’s appeal to Congress during his third State of the Nation Address for the passage into law of a DDR similar to the United States’ Federal Emergency Management Agency. The proposed DDR would take charge of preparing, implementing and monitoring all disaster and climate-resilience programs and activities in the country. In the House of Representatives, the committees on Appropriations, National Defense and on Government Reorganization have endorsed for plenary approval the creation of the DDR. HB 6131 is Villafuerte’s second initiative to reduce the country’s carbon footprint, the first being HB 4739 that aims to impose a climate tax of P1 peso per 1 kilogram of CO2 emission in the electricity consumption of residential or household consumers exceeding 60 kilowatt-hours to generate funds for projects that aim to make the country more resilient to the devastating effects of climate change. Jovee Marie N. dela Cruz

tive governance, reduce corruption and curtail bureaucratic red tape, strengthen financial inclusion and promote ease of doing business. The Philippines has a UnifiedMulti-Purpose ID (UMID) system in place but Bersales earlier said the proposed Philippine ID is different from UMID. Bersales said UMID is a “functional ID” while the proposed Philippine ID is a “foundational ID.” She said functional IDs are ID cards, numbers, or other systems created for specific government services, such as driver’s licenses and voter cards. Foundational IDs are not linked to special services, but serve as a legal proof of identity for multiple purposes, for example, as unique ID cards. “Parallel to the procurement of the system, we’re already talking to PhilPost that before the year ends also, we will enroll 1 million Filipinos,” Bersales said. These one million citizens will be composed of Filipinos receiving the Unconditional Cash Transfer (UCT). The list of recipients will be obtained from the Department of Social Welfare and Development (DSWD). These recipients will be issued a 13-digit number which will serve as their National ID. Accessing the ID will reveal eight demographic contents, including the person’s photo and fingerprints. Bersales said later on, the National ID will evolve into a digital ID that Filipinos can use to transact with government or even private sector participants.

‘Ballet’ in the sky: PAL flight from Toulouse

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F the 80 passengers aboard the Philippine Airlines (PAL) A350-900XWB that took off from Blagnac Airport in Toulouse, France, on July 14, on their journey home to Manila, probably only a few noticed that the pilot-in-command performed a stunt. Just moments after leaving the ground, Capt. Emmanuel “Butch” Generoso dipped the wings slowly in a deliberate, aerial ballet: left, right, left. Only very few lucky passengers would ever experience this signature “farewell” by a pilot and aircraft in their lives. Normally, commercial jets climb straight ahead and then make a turn after reaching 2,000 feet. However, in this case, the 250-ton airplane was just a few feet off the ground when the airplane keeled three times. No, the veteran pilot did not lose control of the $317.4-million wide-body plane, equipped with the most efficient engine flying today. Rather, the pilot was actually accomplishing a highly skilled maneuver known as “wing wave.” “The wing wave is a gentle dip of the plane from one side to another, to say ‘Au revoir, so long, good-bye’ as the aircraft will never again see the ‘nest’ where it was made,” said Capt. Generoso when asked for the meaning of his aerobatics back in Manila. The move was also performed as a “thank you” gesture to Airbus staff at Blagnac Airport, Europe’s center of the aerospace industry. Blagnac, Toulouse, in the south of France, is where the final assembly of most Airbus aircraft takes place: the A321neo, A330neo, A350-900XWB, A350-1000 and the A380. Recto Mercene

A4 Monday, August 6, 2018 • Editor: Vittorio V. Vitug

Economy BusinessMirror

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Only 969 tourism enterprises accredited with DOT By Ma. Stella F. Arnaldo

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@Pulitika2010 Special to the BusinessMirror

ANY hospitality establishments and tourism enterprises in the country have been operating without accreditation from the Department of Tourism (DOT). As of July 2018, the DOT web site showed only 969 accredited tourism enterprises. These include adventure and ecotourism facilities, agritourism farms/sites; ambulatory clinics; apartment hotels/apartels; department stores/shopping malls; ecolodges; ecotour operators; galleries; home stay establishments; hotels; medical concierges; meetings, incentives, conventions and exhibit facilities; MICE organizers; motels; museums; pension houses; resorts; rest areas; restaurants; shooting ranges; spas; specialty shops; tertiary hospitals; tourism entertainment complexes; tourism recreation;

tourism training centers; tourist airtransport operators; tourist inns; tourist land-transport operators; tourist water-transport operators; travel and tour agencies; and zoos. This developed as the DOT officials are making the accreditation of tourism enterprises mandatory nationwide. In an interview with the BusinessMir ror, DOT A ssistant Secretary for Tourism Regulation, Coordination and Resource Generation Ma. Rica C. Bueno said they want Boracay Island to become the template for accreditation in other tourism destina-

tions. “We really hope so. We now have a chance to directly guide our industry on the necessary measures, not only for the improvement of the quality of the services but also [for establishments] to protect their own business.” The DOT has said no hotel or resort on Boracay will be allowed to reopen on October 26 if it isn’t accredited by the agency. A tourism establishment can only be accredited by the DOT after it secures the necessary business permits and environmental clearances. The interagency Task Force Boracay has just set up a one-stop shop for Boracay establishments to process their local business permits, environmental clearance certificates and DOT accreditation at the function room of Casa Pilar, in Station 3. The shop will be manned by representatives of the DOT, and the Departments of Environment and Natural Resources (DENR) and of the Interior and Local Government (DILG). Under Republic Act (RA) 9353, otherwise known as the Tourism Act of 2009, the DOT is tasked to

develop a system of standards for the accreditation, which are mandatory for primary tourism enterprises and voluntary accreditation for secondary tourism enterprises.” “Primary tourism enterprises” refers to travel and tour services; land-, sea- and air-transport services exclusively for tourist use; accommodation establishments; convention and exhibition organizers; tourism estate-management services; and others that the secretary may identified in consultation with relevant sectors. “Secondary tourism enterprises” refers to those not identified as primary enterprises. The DOT can impose fines and other penalties for violations, including cancellation of an enterprise’s accreditation, all in accordance with the gravity of the offense. Ma ny tour ism enter pr ises nationwide, however, have been operating without DOT accreditation, a problem that keeps cropping up whenever tourists and other consumers complain about a certain travel agency, tour operator, hotel, etc. DOT officials

have been encouraging tourists to only book their accommodations or tours with accredited establishments to protect them from unscrupulous practices. Bueno said when RA 9353 was promulgated, the DOT signed a memorandum of agreement with the DILG and the DENR, as well as other concerned agencies with regard to tourism development. This includes helping in the fulfillment of DOT-accreditation rules. “So we’re working on the enforcement of mandatory accreditation through this, the Boracay model. We might really have a new instrument signed among DOT, DENR and DILG [to make it nationwide],” she said. On the issue of continuity of the memorandum of agreement after the Duterte administration, or the possibility that RA 9353 be amended to strengthen the accreditation regulations, Bueno said, “DOJ [Department of Justice] is reviewing all legal instruments pertaining to Boracay. In the next meeting of the task force, we can put forward how [the MOA on en-

forcing tourism accreditation] be institutionalized.” She added that the DOT is also looking at forging a MOA with the Department of Trade and Industry on consumer protection, “because we’ve received complaints on nonaccredited enterprises.” According to the DOT web site, the benefits and incentives of accreditation include: “Endorsement to embassies and travel trade association/s for utilization of establishment’s facilities and services; eligibility for participation in travel fairs; priority to DOT training programs; endorsement to international airports for issuance of access pass to qualified personnel [for two years accredited tour operators and accommodation establishments only]; endorsements to the Commission on Elections for exemption from liquor ban during election-related events [for accommodation establishments and restaurants only]; free online/print advertising in national dailies; and promotion of events in Facebook page and other social-media sites.”

10 outstanding youth groups feted in 2nd Villar Sipag Youth awards LGUs must take lead in cutting red tape–NZ envoy

Sen. Cynthia A. Villar poses with the winners in the second Villar Sipag Youth awards 10 outstanding youth groups (seated, from left): Rayjand Gellamucho-Youth First Initiative Philippines Inc.; Ma. Arlene P. Toledo-Tigbao 4H Club 3; Rafael Dionisio-The Circle Hostel: Tribes & Treks, and The Plastic Solution; Reymark P. Marcos; Monteverde 4H Club; Kyle Isaac Tan Kua-Adopt A Barangay; Metodia B. Maraguinot-Youthlead Philippines; Brian Justin E. Sta Ana-Gubat Young Farmers Association; Gil Anthony Lafuente-Soldiers of God; Crisner Lagazo-Sulbec 4H Club; and Jay S. Cutanda-New Leyte National High School 4H Club. Also in the photo are (standing, from left): Justice Undersecretary, ex-Rep. Em Aglipay Villar and daughter Emma Therese Villar; Camille Villar and son Tristan; Sen. Cynthia Villar and former Senate President Manny Villar. The Villar Sipag Youth Poverty Reduction Challenge recognizes outstanding youth organizations for their unique and innovative solutions and undertakings to address in poor communities. VILLAR SIPAG FOUNDATION

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he Villar Sipag (Social Institute for Poverty Alleviation and Governance) Foundation has again acknowledged the important role of the youth sector in significantly reducing poverty in the country and improving the lives of many poor families. In the second Villar Sipag Youth Poverty Reduction Challenge, the Foundation gave due recognition to 10 outstanding youth organizations for their unique and innovative solutions and undertakings to address poverty in impoverished communities. The 10 winners were chosen from over 150 youth organiza-

tions, composed of college students and out-of-school adolescents aged 18 to 29 years old, which submitted their entries for the 2018 Villar Sipag Awards for the youth category. “I am filled with joy and pride to see the young generation of today actively helping poor communities, and the government, as well, in the long-drawn battle against poverty. These young men and women have made it their responsibility to make the lives of their fellow Filipinos better, a task that the government has been failing to do for decades now,” Sen. Cynthia A. Villar said. Villar also said: “The task is

gargantuan, but if we all work together, we will someday succeed. I am grateful to all the participants for sharing their ideas with us. I assure them that Villar Sipag will never waver from its commitment to work with the youth for the betterment of our country.” Villar, director of Villar Sipag, her husband former Senate President Manny Villar and Public Works Secretary Mark A. Villar led the awarding ceremonies held at the Villar Sipag Hall in Las Piñas City. After thorough deliberations, studies, evaluations and validations, the following were adjudged Most Outstanding Youth Organi-

zations: Soldiers of God (Marikina City), Sulbec 4H Club (Pasuquin, Ilocos Norte), the Circle Hostel: Tribes & Treks, and The Plastic Solution (San Felipe, Zambales), Adopt-A-Ba ra ngay: Ba ra ngay Puray, Rodriguez, Rizal (Rodriguez, Rizal), Gubat Young Farmers Association (Gubat, Sorsogon), Tigbao 4H Club( Aroroy, Masbate), Youth First Initiative Philippines Inc. (Iloilo City), Youthlead Philippines Inc. (Tagbilaran City, Bohol), Monteverde 4H Club (Zamboanga City) and New Leyte National High School 4H Club (New Leyte, Maco, Compostela Valley). Each organization received a cash prize of P150,000 and a Villar Sipag Awards trophy. The Youth Poverty Reduction challenge is a competition for youth organizations that have at least three youth members and must be operating for a minimum of one year. Submitted entries were subjected to rigid evaluation, comprehensive screenings and rational project defense. Winners were selected by a panel of respected judges. To qualify for the competition, entry undertakings should focus on food or agricultural products, recycling waste materials or agricultural waste products, green inventions/environment saving inventions/green technology, water/ waste/energy solutions, rural and urban innovations, information technology and livelihood development, among other things. Submissions were judged based on the uniqueness and originality of their concept, ability to creatively demonstrate how they will solve the poverty problem in their selected communities, flexibility to any given situation and sustainability.

By Elijah Felice E. Rosales @alyasjah

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ore than a law on ease of doing business (EODB), local governments have to overhaul their mind-set on administering transactions if they are truly committed to cutting red tape, according to a top envoy. New Zealand Ambassador to the Philippines David Strachan said laws can only do so much, and reforms as big as improving the country’s EODB rating have to start from the ground. For the Philippines, he said it can begin with local governments treating their citizens as customers, not as profitable entities. “We should not get too trapped into the thinking that it is all about the law. Laws are really helpful, but it is the mind-set that needs to change,” Strachan said at the BusinessMirror Coffee Club Forum held recently in Makati City. “If officials can treat citizens as customers, so you want to do the best offer, the best possible service to customers. They are not just seen as taxpayers, but they are seen as customers. How can you make things easier for business? You have got a very young population, a median age of 23,” he added. Strachan said the government should be working on the online registration of businesses to cater to the country’s young demographic. “I think a lot of young Filipinos are going to really be attracted to something that is much more information technology-friendly. Our median age is 38, yours is 23. I think we want to take advantage

of the demographic sweet spot that you got there,” he said. For two years in a row, New Zealand topped the World Bank’s Doing Business report, with a score of 86.55 in the 2018 cycle and is ahead of 190 economies. The Philippines, however, is miles away from New Zealand, scoring 58.74 and placing 113th. Across Southeast Asia, it was lagging behind Singapore (second); Malaysia (24th); Thailand (26th); Brunei Darussalam (56th); Vietnam (68th); and Indonesia (72nd). The government tapped New Zealand in reforming its procedure for business registration as part of efforts to improve the country’s EODB ranking. Wellington-based Creative HQ is working with the trade department and local government units in creating a single online portal where businesses can register and apply for permits. “We are confident in working with your government through this New Zealand firm that we can boost the Philippines’s ratings in terms of the World Bank ranking. More important, we can produce a customer-friendly service that makes it a lot easier to register a business,” Strachan added. P resident D uter te i n May signed Republic Act 11032, or the EODB and Efficient Government Service Delivery Act, targeted at cutting red tape and simplifying business registration. Under the law, simple government transactions should be processed within three working days; complex transactions seven working days; and highly technical transactions 20 working days.

Scrapping QR to allow more rice imports will harm PHL farmers–Ibon By Samuel P. Medenilla @sam_medenilla

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N independent research group said the plan of lawmakers to pass a new measure to remove the quantitative restriction (QR) on rice to slash prices will also cut the income of farmers. IBON Foundation said in a statement that a bill that would amend Republic Act (RA) 8178, or the Agricultural Tariffication Act of 1996, will cause the farm-gate price of unmilled rice to go down due to more rice imports, but not necessarily lower the retail price of the staple. “If higher importation will decrease farmgate prices, then the already insufficient income of farmers will fall further,” IBON said. The group said the current farm-gate price of palay at P21 per kilogram (kg) is “insufficient” for the needs of farmers.

“Computing the average yield of 80 cavans of palay from 1 hectare, which is equivalent to 4,000 kg, a rice farmer earns only P36,000 until the next cropping,” IBON said. “Each cropping commonly lasts for six months, which means that the farmer’s average monthly income of P6,000 is 76 percent short of the estimated monthly family living wage [FLW] of P25,454 for a family of five,” it added. The Trade Union Congress of the Philippine (TUCP) earlier said the government could help boost the competitiveness of local farmers to compete head to head with their overseas counterparts by providing them technical support using the a portion of the tariffs from rice importation. In his third State of the Nation Address last month, President Duterte said he will certify as urgent a bill that would replace the QR on rice with tariffs.

The move is aimed at arresting the spike in rice prices, which have increased for six straight months—by P2.53, from P37.83 per kg to P40.36 per kg for regular milled rice and by P1.61, from P42.58 per kg to P44.19 per kg for well-milled rice. IBON also said the new legislative measure will not address the root cause of high prices for the Filipino food staple: rice cartels. “Congress may be misguided for placing its hopes on unlimited rice importation for stabilizing supply and prices, while the rice industry remains dominated by an alleged trading cartel that dictates rice prices,” IBON Foundation said. The group said this was “apparent” during the rice crisis of 2008 up to 2010, when the country imported an annual average of 2.2 metric tons of rice, but the retail prices of the cereal grain continued to increase by an annual average of P1.20 until 2016.

FILE photo

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Editor: Angel R. Calso • Monday, August 6, 2018 A5

‘US now has upper hand on China in trade war’

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resident Donald J. Trump defended his use of tariffs that have inflamed tensions with China and Europe, telling an audience of die-hard supporters on Saturday that playing hardball on trade is “my thing.” “We have really rebuilt China, and it’s time that we rebuild our own country now,” Trump said on Saturday during about an hour of freewheeling remarks at a rally outside Columbus, Ohio. He added that Chinese stocks are down, weakening that nation’s bargaining power in the escalating trade war. Hours before the rally, Trump posted a string of tweets on the issue, saying the US market is “stronger than ever,” while the Chinese market “has dropped 27 percent in last four months, and they are talking to us.” It was unclear which measure of Chinese stocks Trump was referring to. The US S&P 500 index, a broad measure of major US companies, has yet to regain highs made in January,

just before the escalation of trade tensions initiated by the US. “Tariffs are working far better than anyone ever anticipated” and would make the US “much richer than it is today,” the president tweeted. At the rally, Trump added that the Europeans are “dying to make a deal.” Trump went to Lewis Center, Ohio, to stump for Troy Balderson. The Republican state senator is facing an unexpectedly close contest against Democrat Danny O’Connor in an August 7 special election for the congressional seat vacated earlier this year by Rep. Pat Tiberi. In 2016 Trump carried Ohio’s 12th House district, but the current

Trump AP

House race is rated as a toss-up in a seat Republicans have held for more than three decades. Whether Trump can help Balderson may be seen as another signal of how likely Democrats are to take control of the House of Representatives in November.

Steel industry

IN a nod to the Ohio economy, Trump said on Saturday on Twitter that tariffs “have had a tremendous impact on our Steel Industry.” The president has said several times in the past two

months, without evidence, that US plans to open six or seven new steel mills. He talked about steel at some length during the rally, saying the industry is making “one of the biggest comebacks.” The Ohio stop was Trump’s third political rally in the past week, following stops in Tampa, Florida, and Wilkes-Barre, Pennsylvania. The president is expected to add additional events, one or more per week, through Labor Day. The events give Trump a chance to

frame on his own terms his much-debated moves on trade, foreign policy, media bashing and interactions with Russian President Vladimir Putin. And that may be a welcome distraction in a week when headlines were dominated by the start of the trial of his one-time campaign Chairman Paul Manafort on fraud charges connected to his work for Russians and Ukrainians.

Demonizing critics

The rallies are also a venue for

Trump to demonize high-profile critics whom he believes his political base also resents, including the media, Congressional Democratic leaders and various celebrities. On the eve of Saturday’s event, Trump took to Twitter to question the intelligence of basketball great LeBron James, who’s been critical of the president. James, 33, who left the Cleveland Cavaliers at the end last season to join the Los Angeles Lakers, was in the news this week for using his fortune and fame to launch a school for at-risk youth in his Ohio hometown. Trump didn’t talk about James at the rally, though. Earlier, a spokesman for Melania Trump said the first lady was open to visiting James’s new school and that the NBA star is “working to do good things.” This week’s trio of rallies also underscores two tests this year’s midterm elections present for Trump: whether his enduring popularity with Republicans in swing states he won in 2016 can transfer to down-ballot candidates by driving turnout. And, conversely, whether a backlash to his administration energizes Democratic voters in November. Bloomberg News

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A6 Monday, August 6, 2018

Asian diplomats press N. Korea to deliver on anti-nuclear vows

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INGAPORE—Asia’s top diplomats pressed North Korea on Saturday to turn a pledge to completely dismantle its nuclear arsenal into reality amid concerns that it’s proceeding with its programs. North Korea’s foreign minister, Ri Yong Ho, however, hit the United States in an Asian security forum in Singapore for certain “alarming” moves, including “raising its voice louder for maintaining the sanctions against” the North. Those moves, Ri told fellow ministers, could make an agreement with the Trump administration, including the North’s commitment to work toward complete denuclearization of the Korean Peninsula, “face difficulties.” China and Southeast Asian nations also faced calls in the Singapore meetings to rapidly conclude an effective nonaggression pact that can help fend off possible clashes in the disputed South China Sea. Both sides have announced an agreement on an initial draft of a regional “code of conduct” that they regarded as a milestone after 16 years of sporadic talks. Alarm over rising trade protectionism, which Asian governments warn could stymie economic growth, dominated the meetings, too, with Japan calling for the swift conclusion of a 16-nation Asian free-trade agreement that does not include the United States. Philippine Foreign Secretary Alan Peter S. Cayetano said the rapprochement between North Korea and the United States, along with completion of a negotiating draft of the code of conduct for the South China Sea, are breakthroughs. But he added that “like any other breakthrough in diplomatic negotiations, they may lead to something great, they may lead to nothing.” “Now the hard work is really on the details,” Cayetano told reporters

before walking into daylong meetings between the Association of Southeast Asian Nations and their partners the United States, China, Japan and South Korea. Asean foreign ministers, along with counterparts from China, Japan and South Korea, urged the US and North Korea “as well as concerned parties to continue working towards the realization of lasting peace and stability on a denuclearized Korean Peninsula,” according to a draft communique they were to issue after their meetings on Saturday, which was seen by The Associated Press (AP). In the communique, they would “note”—often a diplomatic subtlety for a reminder—the “stated commitment” of the Democratic People’s Republic of Korea, the North’s formal name, “to complete denuclearization and its pledge to refrain from further nuclear and missile tests during this period.” A summary of a new report by experts monitoring UN sanctions against North Korea, which was sent to the Security Council on Friday night and obtained by the AP at the United Nations, said North Korea has not stopped its nuclear and missiles programs and continues to defy the sanctions resolutions. The North was also violating sanctions by transferring coal at sea and flouting an arms embargo and financial sanctions, the report said. Ri said that while North Korea has “initiated goodwill measures,” including a “moratorium on the nuclear test and rocket launch test and dismantling of nuclear test ground,” the US has gone “back to the old, far from its leader’s intention.” Ri made the remarks in a speech

Philippine Foreign Secretary Alan Peter S. Cayetano (from left), South Korean Foreign Minister Kang Kyung-wha, Russian Deputy Foreign Minister Igor Morgulov, US Secretary of State Mike Pompeo, Vietnamese Foreign Minister Pham Binh Minh and Singaporean Foreign Minister Vivian Balakrishnan pose for a photo during the East Asia Summit Foreign Ministers Meeting on the sidelines of the 51st Asean Foreign Ministers Meeting in Singapore on Saturday. AP

that came after US Secretary of State Mike Pompeo, who was at the same Asean conference, warned Russia, China and others against any violation of international sanctions that North Korea continues to face. After agreeing on the text of the code of conduct in the disputed waters, senior Chinese and Asean diplomats will meet in Cambodia this month or in September, to be followed by another meeting in the Philippines, to start actual negotiations, a senior Southeast Asian diplomat said on condition of anonymity because of a lack of authority to discuss the issue publicly. Western officials called for an early conclusion of such a pact, which they said should be legally binding and could effectively check aggressive behavior in the disputed region. Chinese Foreign Minister Wang Yi said that “without disturbances from the outside” the negotiations on the code would shift to a “fast-

track.” China has accused the US, which has deployed aircraft carriers, ships and fighter jets to patrol the disputed waters, of intervening in an Asian dispute. Amid the trade tensions between the United States and China and other nations, Asian ministers called for an early conclusion, possibly this year, of talks for the Regional Comprehensive Economic Partnership (RCEP), a free-trade accord that would include the Asean, along with key trading partners China, Japan, Australia, New Zealand, India and South Korea. Singapore, Malaysia and other Southeast Asian nations are concerned that protectionism, which could boost major Western economies, would work against free and open trade that their economies are anchored on. Tensions between the US and China—the world’s two biggest economies—over tariffs on each other’s products have rattled

investors in Asia. “Given the current global situation where protectionism is on the rise, Japan would like to achieve the swift conclusion of the RCEP,” Japanese Foreign Minister Taro Kono said. South Korean Foreign Minister Kang Kyung-wha warned that “rising anti-globalization and trade protectionism among major countries is fueling tension and threatening our aspiration for sustained economic growth.” In a one-on-one meeting on the sidelines of the Singapore events, Malaysian Foreign Minister Saifuddin Abdullah said he told Pompeo that Asian countries like Malaysia “are quite nervous on the possible negative repercussion of the ongoing trade war.” Pompeo responded articulately “but my objective was quite straightforward,” Saifuddin told a news conference. “I need to inform him that we are very concerned.” AP

Tit for tat becomes the norm as US, China trade war starts

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he trade war between the world’s two biggest economies is taking on a life of its own. When President Donald J. Trump first threatened to slap tariffs on Chinese goods in March to punish Beijing for stealing American intellectual property, trade experts warned the two nations risked slipping into a downward spiral of tit-for-tat trade actions. The global economy now appears to be living that reality, with the trade war settling into a regular rhythm of counterblows. The latest shot came on Friday, when China released a list of $60 billion in US goods that Beijing intends to hit with tariffs in retaliation for Trump’s plan to impose duties on $200 billion in Chinese imports. While the Chinese threat isn’t proportional in absolute dollars, it’s actually an escalation on a relative basis, given that China buys less from the US. Within hours, White House economic adviser Larry Kudlow promised Trump wouldn’t back down until China changed its trade practices. “Don’t underestimate President Trump’s determination to follow through,” Kudlow told Bloomberg Television. On Saturday Trump repeated his assertion that the strategy is succeeding. “Tariffs are working far better than anyone ever anticipated,” Trump said in a series of four Twit-

ter messages. “China, which is for the first time doing poorly against us, is spending a fortune on ads and P.R. trying to convince and scare our politicians to fight me on Tariffs— because they are really hurting their economy.”

‘Stop digging’

“WE are winning, but must be strong!” Trump added. William Reinsch, a trade expert at the Center for Strategic and International Studies who worked at the Commerce Department during the Clinton administration, said the Trump administration keeps “digging the hole deeper, violating the first rule of holes, which is when you’re in one, stop digging.” Amid the more heated rhetoric, US stocks ended the week up about 0.8 percent, the fifth straight week of advances. The Chinese equity market this week slumped 5.9 percent, the steepest drop since February. Trump suggested that the market decline is getting China’s leaders back to the table for talks. Hopes had been rising that Trump might drop his trade-war campaign, after the president announced a deal last week with European Commission President Jean-Claude Juncker that would see the US and EU cut tariffs and other barriers. There are also signs the Trump administration is trying to revive formal negotiations with Beijing.

In the meantime, signs of the trade war are creeping into the economic data. US manufacturers are considering expanding outside the country to avoid the widening trade conflict, according to the Institute for Supply Management’s July survey. Such sentiment may weigh on business investment, which contributed last quarter to the fastest pace of growth in four years.

There’s “some hint” the Chinese may be warming to the idea, and recently there’s been some communications at the highest levels of both governments, Kudlow said. A White House spokesman said the administration remains open to further talks.

‘Chronic problem’

China so far has shown little sign of backing down. At a regional security forum in Singapore on Saturday, Foreign Minister Wang Yi said free trade had been dealt a “heavy blow,” and defended his country’s actions. “These measures were taken out of consideration for the interests of the Chinese people and to upholding the World Trade Organizationcentered free trade regime,” he said. Finding common cause with Europe is one thing. America’s differences with China, a one-party state

that’s promised to open its markets gradually, run deeper. US Trade Representative Robert Lighthizer last week called trade tensions a “chronic problem” that would likely take years to resolve. Kudlow cited state subsidies and forced technology transfers as behaviors that the Trump administration wants China to end.

Escalation, calm

Earlier this week, the US said it was considering more than doubling to 25 percent the tariffs for the $200 billion in Chinese imports that are under public review. The conflict with China is taking on a “cyclical” pattern with roughly two weeks of escalation followed by two weeks of relative calm, said Mark Rosenberg, chief executive at Geoquant Inc., a firm that uses computer models to gauge political risk. “These two sides effectively have equal leverage over one another,” Rosenberg said. “No one has a real incentive to blink first. That suggests this is going to be a more protracted conflict.” The question is what other tools the two countries may use, once they have no more goods upon which to impose tariffs. The US imported $506 billion in goods from China last year, and Trump has threatened to slap duties on effectively all imports from the Asian nation. China imported $130 billion in goods from the US in 2017, according to US figures.

Yuan’s decline

Currencies would be one option. Kudlow suggested on Friday that China is letting its currency fall to offset losses from the trade war, though he added that the decline is partly due to weak economic fundamentals. The People’s Bank of China stepped in to support the yuan on Friday after the currency slid to the lowest in more than year. In the meantime, signs of the trade war are creeping into the economic data. US manufacturers are considering expanding outside the country to avoid the widening trade conflict, according to the Institute for Supply Management’s July survey. Such sentiment may weigh on business investment, which contributed last quarter to the fastest pace of growth in four years. The Trump administration may be overestimating its ability to pressure Beijing into changing its economic behavior, said Stefan Selig, managing partner at BridgePark Advisors Llc. and former trade undersecretary at the Commerce Department under President Barack Obama. China’s one-party system gives President Xi Jinping several advantages in a trade war, such as the ability to control the nation’s media, Selig said. “It’s such a fundamental miscalculation that the Chinese are going to buckle,” Selig said. Bloomberg News

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Iran rescues currency ahead of reimposed US sanctions

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ran plans to implement a new financial rescue package on Monday to try and halt the rial’s decline, coinciding with the reimposition of severe US sanctions on the oil-rich state’s economy after President Donald J. Trump pulled out of the Iran nuclear deal. The decision follows a week of sporadic protests against Iran’s political and religious establishment as concerns over the economy mount. On Friday one person was shot dead and 20 others arrested in the city of Karaj, west of Tehran, the semiofficial Fars news reported. About 500 protesters in Eshtehard, a town west of the capital Tehran, used stones and bricks to smash the windows of a seminary and tried to set fire to its building, Fars news reported, citing local cleric Hojjatoleslam Hendiani. Fars reported that a number of the protesters had been arrested by police who then went house to house trying to identify them. Video posted to social media this week purported to show protests in various Iranian cities, including the capital Tehran. None of the footage can be independently verified but appeared to show people chanting against the government. Iran is struggling to quell anger over rising prices while seeking to assure the public that it can successfully counter the economic crisis triggered by Trump’s decision to withdraw from the 2015 nuclear accord. At the same time, its fighting to stem the rial’s decline, which has slumped to record lows against the US dollar since the start of the year amid protests. Iran’s judiciary, legislature and government on Saturday approved plans by the Central Bank of Iran to strictly limit access to official, fixed currency rates to essential imports, the semiofficial Iranian Students’ News Agency reported. Also approved were measures to tighten the process of allocating foreign currency to businesses and crack down on corrupt practices and currency manipulation, it said. Trump’s sanctions will ban purchases of dollar banknotes by Iran, prevent the government from trading gold and other precious metals and block the nation from selling or acquiring various industrial metals. The measures also target the country’s autos sector and will ban exports of Persian carpets and pistachios to the US. A second round of sanctions targeting Iran’s oil imports and energy and petrochemicals industries are scheduled to come into effect on November 4. Details of the new measures will be discussed at a cabinet meeting on Sunday and then implemented after the head of the central bank announces them on Monday, first Vice President Eshaq Jahangiri told reporters, according to ISNA. Bloomberg News

Hot weather forces 4 French nuclear reactors to shut down

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ARIS—As Europe struggles through a major heatwave, the French energy company EDF says it has halted a fourth nuclear reactor, this time one at the country’s oldest nuclear plant at Fessenheim in eastern France. In a statement, EDF said the Fessenheim nuclear reactor was temporarily shut down on Saturday. Since Thursday, four French nuclear reactors in three power plants near the Rhine and the Rhone Rivers, including Fessenheim, have had to be temporarily shut down. EDF said the decision was made to avoid overheating the rivers. Nuclear-power plants use water from the rivers to cool down the temperatures of their reactors before sending the water back into the rivers. Rivers that are unusually warm can experience mass fish die-offs, which has happened in Germany in the past week. AP

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Brown asks Trump for wildfire aid as California battles 17 blazes

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AN FRANCISCO—Gov. Jerry Brown on Saturday called on President Donald J. Trump to help California fight and recover from another devastating wildfire season. Brown, who inspected neighborhoods wiped out by a wildfire in the Northern California city of Redding, said he was confident the president he has clashed with over immigration and pollution policies would send aid, which Trump did last year when California’s wine country was hit hard. “The president has been pretty good on helping us in disasters, so I’m hopeful,” said Brown, a Democrat. “Tragedies bring people together.” Brown’s call for help came shortly before authorities called on residents in Glenn and Colusa counties in Northern California to evacuate as a wildfire there continues to grow. Cal Fire issued the evacuation order on Saturday night for people who live in several parts of the counties, including an area just east of the boundary of Mendocino National Forest. The blaze, known as the Mendocino Complex fire, has grown to 357 square miles and is 32-percent contained, according to Cal Fire. The National Weather Service forecasts hot and windy conditions to persist in Northern California. There are 17 major fires burning throughout California, authorities said. In all, they have destroyed hun-

dreds of homes, killed eight people— including four firefighters—and shut down Yosemite National Park. Hundreds of colleagues, family and friends attended a memorial service on Saturday in Fresno for National Forest Service Capt. Brian Hughes, the Fresno Bee reported. Hughes was killed on July 29 by a falling tree while fighting the wildfire that has closed Yosemite National Park at the height of tourist season. Firefighters have achieved 41-percent containment of that forest fire. The fire had reached into remote areas of the country’s third-oldest national park. Workers who live in Yosemite’s popular Valley region were ordered to leave on Friday because of inaccessible roads. The biggest blazes continue to burn north of San Francisco, including twin wildfires fueled by dry vegetation and hot, windy weather. Those fires destroyed 55 homes and forced thousands of residents to flee their neighborhoods about 100 miles (161 kilometers) north of the city. They have grown to a combined 300 square miles (648 km). The two fires have charred an area of the forested, rural area five times the size of San Fran-

In the midst of near-daily protests last year, a rogue police officer flew a stolen helicopter over the capital and launched grenades at several government buildings. Oscar Perez was later killed in a deadly gun battle after over six months on the lam. Attorney General Tarek William Saab said the attempted assassination targeted not only Maduro, but rather the military’s entire high command on stage with the president. Prosecutorshavealreadylaunched their investigation and obtained critical details from the suspects in custody, said Saab, adding that he would give more details on Monday. “We are in the midst of a wave of civil war in Venezuela,” Saab said. Firefighters at the scene of the blast disputed the government’s version of events. Three local authorities said there had been a gas tank explosion inside an apartment near Maduro’s speech where smoke could be seen streaming out of a window. They provided no further details on how they had reached that conclusion. A Colombian official with the president’s office described Maduro’s claims that Santos was involved in the attack as baseless. Adding to the confusion, a little known group calling itself Soldiers in T-shirts claimed responsibility, saying it planned to fly two drones loaded with explosives at the president, but government soldiers shot them down before reaching

its target. The Associated Press could not independently verify the authenticity of the message. “We showed that they are vulnerable,” the group said in a tweet. “It was not successful today, but it is just a matter of time.” The organization did not respond to a message from The Associated Press. David Smilde, a senior fellow at the Washington Office on Latin America who has spent decades researching Venezuela, said the incident did not appear to be a staged attack by Maduro’s government for political gain. The “amateurish” attack prompted embarrassing images of Maduro cut off mid-sentence with droves of soldiers running away in fear, making the president appear vulnerable, Smilde noted. Despite the optics, Smilde said he suspected that Maduro would nonetheless find a way to take advantage of it. “He will use it to concentrate power,” Smilde said. “Whoever did this, he’ll use it to further restrict liberty and purge the government and armed forces.” The event had been just one more of many Maduro routinely holds with members of the military, a key faction of Venezuelan society whose loyalty he has clung to as the nation struggles with crippling hyperinflation and shortages of food and medicine. AP

Flames from a wildfire advance down a hillside, towering over homes off Scotts Valley Road on Thursday near Lakeport, California. Kent Porter /The Press Democrat via AP

cisco and were only 27-percent contained. Thousands of people remain evacuated. The National Weather Service issued red-flag warnings of critical fire weather conditions through Saturday night, saying a series of dry low-pressure systems passing through the region could bring wind gusts of up to 35 miles per hour (56 kilometers per hour) that could turn small fires or even sparks into racing walls of flames.

“This is a particularly dangerous situation with extremely low humidity and high winds. New fires will grow rapidly out of control, in some cases people may not be able to evacuate safely in time should a fire approach,” the weather service said in its bulletin for the Mendocino area north of San Francisco. Meteorologist Steve Anderson said temperatures will remain in the 90s in the region throughout the week with wind gusts reaching

Venezuela’s Maduro: Drone attack was attempt to kill me

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ARACAS, Venezuela—Venezuelan President Nicolas Maduro dodged an apparent assassination attempt when drones armed with explosives detonated while he was delivering a speech to hundreds of soldiers being broadcast live on television, officials said. Caught by surprise mid-speech, Maduro and his wife, Cilia Flores, looked up at the sky and winced on Saturday after hearing the sound of an explosion pierce the air. “This was an attempt to kill me,” he said later in an impassioned retelling of the events. “Today they attempted to assassinate me.” Information Minister Jorge Rodriguez said the incident took place shortly after 5:30 p.m. as Maduro was celebrating the National Guard’s 81st anniversary. The visibly shaken head of state said he saw a “flying device” that exploded before his eyes. He thought it might be a pyrotechnics display in honor of the event. Within seconds, Maduro said he heard a second explosion and pandemonium ensued. Bodyguards escorted Maduro out of the event, and television footage showed uniformed soldiers standing in forma-

25 mph (40 kph) during the day on Sunday. “It’s not good firefighting weather,” Anderson said. More evacuations were ordered on Saturday afternoon for an area of Mendocino and Lake counties where the week-old twin fires are threatening about 9,000 homes. The largest of the two fires was 50-percent contained. The fire remained several miles from the evacuated communities

along the eastern shore of Clear Lake, but “it looks like there’s dicey weather on the way,” California Department of Forestry and Fire Protection Spokesman Jane LaBoa said. However, most evacuations were lifted by Saturday in and around Redding, where armies of firefighters and fleets of aircraft continue battling an immense blaze about 100 miles (160 km) south of the Oregon line. Some areas on the fire’s southeastern flank were reopened to residents. The fire near Redding, which killed six people and incinerated 1,067 homes, started two weeks ago with sparks from the steel wheel of a towed-trailer’s flat tire, Department of Agriculture and Fire Precention officials said. The blaze is currently 41-percent contained. The fire burned slowly for days before winds suddenly whipped it up last week and drove it furiously through brush and timber. It burned so furiously on July 26 that it created what is called a fire whirl. The twirling tower of flame reached speeds of 143 mph (230 kph), which rivaled some of the most destructive Midwest tornados, National Weather Service meteorologist Duane Dykema said. The whirl uprooted trees and tore roofs from homes, Dykema said. The California Department of Forestry and Fire Protection said the blaze had blackened nearly 206 square miles (533 square kilometers). AP

IN this photo released by China’s Xinhua News Agency, security personnel surround Venezuela’s President Nicolas Maduro during an incident as he was giving a speech in Caracas, Venezuela, on Saturday. Drones armed with explosives detonated near Maduro as he gave a speech to hundreds of soldiers, but the socialist leader was unharmed, according to the government. Xinhua via AP

tion quickly scattering from the scene. He said the “far right” working in coordination with detractors in Bogota and Miami, including Colombian President Juan Manuel Santos, were responsible. Some of the “material authors” of the apparent attack have been detained. “The investigation will get to the bottom of this,” he

said. “No matter who falls.” Venezuela’s government routinely accuses opposition activists of plotting to attack and overthrow Maduro, a deeply unpopular leader who was recently elected to a new term in office in a vote decried by dozens of nations. Maduro has steadily moved to concentrate power as the nation reels from a crippling economic crisis.

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A8 Monday, August 6, 2018

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

LGUs going green, rejecting coal projects By Jonathan L. Mayuga

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@jonlmayuga

sent iments in opposing coa l projects are ver y much valid and compelling,” CEED Execut ive D i rec tor Ger r y A ra nces told the BusinessMirror v ia Messenger. According to Arances, coal projects do not only affect the health of the host communities and the environment and climate, in general, but also destroy local livelihoods and industries. “Look at Palawan, Bohol or Guimaras. How can you promote coal there if it will affect the local tourism industry among many others like impacts to fragile biodiversity?” he asked. A ra nces sa id more important, w ith the advent of cheaper and more accessible new R E sources, an LGU can no longer be held host age by just one source of dirty energ y just to prov ide the needed electricity to their respective territories.

ore and more local government units (LGUs) are likely to turn their backs on coal with environmental and climate-justice advocates positively predicting a shift toward renewable energy and a more sustainable development path.

Over the past few years, a good number of LGUs have already rejected coal projects— whether related to mining coal or the construction of a coalfired power plant—with some LGUs even passing resolutions or ordinances affirming their position on the issue. These include the provinces of Bohol, Guimaras, Negros, Ilocos Norte, Masbate, South Cotabato and Ozamis City.

Coal-free zones

Chuck Baclagon of 350.org Southeast Asia, in a reply to a question via e-mail, said: “Masbate, Guimaras, Sorsogon, Ilocos Norte, Bohol and Negros Oriental have already declared themselves as coalfree zones. The growing number of provinces and other local governments issuing such resolutions reflect the increasing realization across the world that coal is bad for the people and the climate.” He added that the false claim that coal is the cheapest energy source has already been debunked. “The over P1 trillion worth of coal plants in the pipeline are at risk of becoming stranded assets, as discovered by the Institute for Energy Economics and Financial Analysis,” he added.

End of coal age

Baclagon said the age of coal is coming to an end. Globally, he noted, there is an intense campaign against coal going on, with environmental and climate-justice advocates influencing policymakers and decision makers in government and private sectors.

“This is the message we are sending to cities, states, businesses and civil society around the world. In fact, some of them are gathering in California for the Global Climate Action Summit, which has invited every mayor, governor and local leader in the world to make a bold climate commitment to help the world reach the goals of the Paris Climate Agreement,” he explained.

Cheaper renewable energy

Switching to clean energy

Rodne Galicha of the Climate Reality Project agreed that more LGUs in the Philippines are saying no to coal and are switching to clean energy. “In 2016 Ilocos Norte became the first LGU to eliminate coal from its energy sources, declaring the province a ‘clean, green and coal-free province,’” Galicha said told the BusinessMirror through e-mail. Ilocos Norte has a 264-megawatt (MW) installed wind capacity as of 2015, making it the country’s wind energy capital. In the Visayas, Guimaras announced in February that it was breaking free from coal. Known for its anti-fossil fuel resistance, the island province resisted the construction of a coalfired power plant in Iloilo City due to the potential impacts on its communities. It has been the home to the region’s first wind farm, the 54-MW San Lorenzo plant since 2014. “More LGUs are hosting renewable-energy [RE] plants, showing their support for sustainability,” Galicha said.

A coal-fired power plant in Limay, Bataan, produces much-needed electricity but contributes to air pollution as it emits black smoke from its chimney. CEED

Solar, wind farms

G a lic h a s a i d s o l a r f a r m s — t h e mo s t r e l i a b l e R E s o u rc e c u r r e nt l y b e i n g u s e d i n t h e Ph i l ippi nes — a re now oper at i n g i n Pa mp a n g a , B at a n g a s , C a v it e , Ne g r o s O r i e nt a l a n d C a g a y a n d e O r o C it y. Wind farms have also been set up in Rizal and Aklan. “ Mo r e l o c a l c o m mu n it i e s have ex pressed their desire for a sw itch to renewables due to its env ironmenta l, hea lt h and economic benefits compared to fossi l f uels,” he added.

Trending

According to environmental groups, there is now a trend on LGUs rejecting coal projects, apparently realizing coal’s adverse and long-term environmental and health impact. The Center for Energy, Ecology and Development (CEED) said that LGUs are slowly realizing the “benefits” of being coal-free. “ T he re i s i nd e e d a t re nd of LGUs slowly rea lizing the pros in rejecting coal projects. T hese LGUs are realizing that their respective constituents’

“Even the issue of revenues for local governments is a misconception. One, these coal projects apply for numerous exemptions under the Investment Code. The so-called ‘cheap-energy’ benefits to their constituents are also being questioned,” he said. “How can coal projects argue that they are the cheapest when solar and wind nowadays is around P2.99/KWh [kilowatthour] and P3.50/KWh compared to around P5/KW h for coal? According to Arances, the trend is that solar, wind and other RE sources do not rely on imported fuels and will just get even cheaper in the years to come. “So, if you weigh everything and come up with a strategic cost-benefit analysis, LGUs benefit more in rejecting these dirty and costly projects and reap the benefits that the shift bring to their constituents and their citizens right to clean and affordable energy, and right to a balanced and healthful ecolog y. Other countries and local governments are already reaping the benefits of this shift. Why not a country, and local governments and their constituents?” he asked.

Support to LGUs

G a lic h a s a id t he n at ion a l gover nment needs to prov ide

suppor t to t he LGUs so t hey could fully transition to greener- energ y sources. “It begins with economic reforms to incentivize such transitions and encourage more investments toward solar, wind and other renewables,” he said. Galicha said that, for many communities, renewables provide an opportunity for selfgeneration of electricity, lowering costs and providing other benefits in the long run. “The administration’s current support to operationalize 10,000 MW of coal power in the next few decades need to be reversed for the long-term well-being of all communities in the country,” he added. He said LGUs near coal plants would be at high risk of exposure to pollution, while other areas will still be affected by impacts partly brought by coal-based energy generation, such as sea-level rise and droughts. “Supporting the shift to renewables is not merely a political statement for the international community; it is the best option toward achiev ing local sustainable development,” he said. The Philippines, an island archipelago, remains highly vulnerable to the impacts of climate change-triggered events. Mining coal and operating coal-fired power plants are not helping protect and conserve its already fragile ecosystem, even as it struggles to implement various environmental laws meant to, among others, protect and conserve its rich biodiversity, ensure sustainable exploitation and use of its natural resources, and, lately, to enhance the countr y’s natural defense against natura l ca lamities, including the intensifying typhoons and excessive rain that trigger f lash f loods, and landslide. This, coupled with sea-level rise and deadly storm surge spell disaster. For env ironmenta l and c lim at e - j u s t i c e a d v o c at e s , a d aptation and mitigation measures, star ting w it h brea k ing f ree f rom coa l or stopping coa l a d d ic t ion , L GUs a re i nd e e d going g reen by rejecting d ir t y coa l projects.

Forests for Life movement launched vs climate change Bottling firm’s environmental drive yields fruit

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outh, local government, farmers and environment groups launched a new movement for the country’s dwindling forests on the foothills of Mounts BanahawSan Cristobal in Laguna province on July 14. Forests for Life (FFL) movement aims to bring back biodiversity in the country’s rainforests with the help of all sectors and people from all walks of life. The launch comes as excessive rains begin to hit the country, exacerbated by climate change. “Even though San Cristobal is far from the coast, our actions here will have an impact on the ecosystem downstream,” said Noel Resurreccion, Conser vation Site Action manager of the Haribon Foundation, one of the members of the FFL movement. To culminate the launch, a tree planting was held inside the Mounts Banahaw-San Cristobal Protected Landscape. Volunteers from various sectors joined the planting activity, including participants from Cebu Pacific. The seedlings were provided by local community groups San Cristobal Farmer’s Association (SCFA) and the San Cristobal Young Farmers. “Our activity today is called planting, giving life and protec ting. We will not abandon our seedlings until they are capable of growing on their own,” explained Salud Pangan, Department of Environment and Natural Resources (DENR) Protected Area Superintendent of the Mounts Banahaw-San Cristobal Protected Landscape. According to Haribon Foundation, the

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Forests for Life movement was launched on the foothills of Mounts Banahaw and San Cristobal in Laguna. It was participated in by organizations, donors and volunteers.

Philippines has lost more than 75 percent of its forest cover since the 1900s. “We are past the 40-percent minimum needed to support water-related functions alone. To ensure that all ecological benefits and services are addressed, we need more than half of the country to be covered in forest, or at least 54 percent. Benefits include provision of water resulting in the decreased occurrence of landslide,” Haribon said. The launch celebrates 13 years of organizing communities for forest restoration. Previously called Rainforestation Organization and Advocates to 2020, the roots of Forests For Life movement go back to the National Consultation on Rainforest Restoration in 2005. Experts at the consultation shared that deforestation and the rampant use of exotic species for reforestation were growing threats to biodiversity in the country. As a result, the effects bring about landslides,

invasive species and increased vulnerability to changes in climate. “Since then the movement to bring back forests has involved tree-planting campaigns, fund-raising drives to plant more trees, awareness-raising on the use of native species and enrollment of new and existing tree-planting sites by other communities,” Haribon said. Participants to the launch included Haribon members and individual volunteers, R ain Forest Restoration Initiative, SCFA, San Cristobal Young Farmers, Samahan ng mga Mamamayang Nagsasaka para sa Kaunlaran ng Banahaw, Environment and Natural Resources G u a rd s I n c. , vo l u nte e r s f ro m Ce b u Pacific, Honda Cars Philippines Inc., Pinnacle, National Power Corp., DENR, representative from the office of Laguna Gov. Ramil Hernandez, and other local government officials and offices.

soft-drinks bottling company has seen major changes in its operations and has received recognition from the government for their progress after launching its nationwide environmental sustainability program in 2016, “PCPPI [Pepsi-Cola Products Philippines Inc.] stands as a prime industry advocate for a greener Earth through our sustainability mission: Doing what’s right for the business without compromising the environment and the communities where the company operates,” said PCPPI Senior Vice President for Operations Allan Frias II. A m id g loba l a nd loc a l ef for ts to inhibit globa l war ming, “Luntiang Yaman” initiates PCPPI’s solution to address climate change as an institution and minimize its impact by nurturing the env ironment. The program focuses heavily on five key areas for conservation and development until 2020—water, electricity, fuel, solid waste and the community. Luntiang Yaman aims to reduce PCPPI’s water usage by 10 percent year- on-year, reduce electricity usage by 5 percent YoY, reduce fuel usage by 5 percent YoY, a nd i mprove sol id

waste recycling to 85 percent through management systems. Included in the initiative is the company’s commitment to conduct social responsibility initiatives that highlight environmentalism through annual community volunteerism projects. According to Frias, the program maximizes the bottling company’s opportunity to manufacture and distribute products using viable means, while consuming less resources and minimizing waste generation. It also involves its work force in impacting the company’s surrounding communities through various initiatives like yearly tree-planting drives, and estero and street cleanups. T he employees recent ly brought light back into Marawi t h rou g h a pa r t nersh ip w it h MyShelter foundation in recycling PET bottles to transform them into sustainable sources of light for the war-ravaged city. Since the program’s implementation, Frias highlighted that the company has consistently outpaced its targets and has been commended by the Department of Energy (DOE) for its successful energy conservation. PCPPI received six awards in the DOE’s Don Emilio Abello

Energ y Ef f icienc y Awards in December 2017. The bottling company’s Centra l Luzon office and Tanauan pl ants were recog ni zed w it h Special Energ y Efficiency awards. Meanwhile, its Cebu and Davao plants received citations for Outstanding Energ y efficiency with their respective production, and maintenance managers receiv ing Outstanding Energ y Manager awards. “As of 2018 to date, compared to 2017 in the same period, water usage has been reduced by 23 percent, fuel usage has reduced by 15 percent, electricity usage reduced by 12 percent and solidwaste recycling had reached 85 percent,” Frias said. With the success of the program, Frias noted that PCPPI is ready to continue its advocacy in building itself as a responsible corporate citizen and inspiring other industry movers to follow their lead. “By actively contributing to t he globa l d r ive in reducing the impact of climate change through business and community developments, PCPPI is proud to stand in the years to come as an example of environmental excellence for the industr y we move in,” he said.

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Asean Champions of Biodiversity Media Category 2014

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

Monday, August 6, 2018

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International Day of Mangroves

World’s mangroves struggling to survive

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By Michael A. Bengwayan

percent to a high of 8 percent in some areas annually for the past 10 years, they said. Charcoal-making is a major culprit, kept alive by the millions of rural and urban poor who rely heavily on charcoal for energy needs in this nonoil and nonpetroleum producing country enslaved by expensive fuel imports.

he remaining mangrove ecosystem the world over is facing serious destruction, much of which may be irreversible.

This sad assessment greeted the International Day of Mangroves on July 26, from marine biologists and environmentalists worldwide who are studying the effects of human activities on mangrove forests. More than 35 percent of the world’s mangrove forests have been lost in the past two decades, losses that exceeded those for tropical forests and coral reefs, deplored Dr. Ivan Valiela, professor of biology at the Boston University Marine Program and American Institute of Biological Sciences. That is not all. Close to 40 percent of the remaining mangrove forests suffer from human a lterations that were caused by conversion of mangroves to mariculture, agriculture and urbanization, as well as forestry uses and the effects of warfare, Valiela revealed. The loss of mangroves is serious and continuing at rate of approximately 1 percent yearly which is three to five times higher than the overall of global forest loss, he said. Mangrove forests—which are vital ecosystems in the import a nt t ropic a l env ironment— have received much less publicity regarding their destruction, compared to forests being felled and coral reefs undergoing bleaching. Concerns about the magnitude of losses of mangroves have been voiced mainly in the specialized literature, the marine biologists lamented.

Importance of mangroves

Mangrove forests are vital in providing breeding, sanctuary and habitat for fish and many forms of marine life.

They are sources of important medicine for the human world, and provide a wide range of goods to human communities, such as wood and nonwood forest products. More important, they play a crucial role in carbon-dioxide sequestration, cooling of the Earth, natural buffers against tsunamis and coastal protection, recreation, ecotourism, and as nursery and feeding grounds.

Distribution

The World Mangrove Atlas shows mangroves are distributed in 123 countries in the world, with Asia having the most, followed by Africa, north and central America, Oceania and South America. By region, Southeast Asia has the most mangroves, followed by South America, North and Central America, west and central Africa and South Asia, Australasia, east and south Africa, Pacific Ocean and the Middle East. East Asia has the least area of mangroves. Indonesia has the largest mangrove area with 31,894 square kilometers, while Colombia has the least with 4,079 sq km.

Mangrove destruction

According to Prof. Dr. Shigeyuki Baba, executive director of the International Society for Mangrove Ecosystems (ISME) based in Okinawa, Japan, from 1980 to 2005 the worst mangrove destruction occurred in East Asia where 33.4 percent of its total mangrove area was lost. Next is the Pacific Islands, which lost 28.8 percent; Southeast Asia, 26.5 percent; north and central America, 23.3 percent and South Asia, 17 percent.

Killing fish to raise fish

Mangroves with exposed roots file photo

Mangrove forests have been depleted and subjected to various stresses originating from human activities, Baba said. The Working Group on Mangrove Ecosystems of the International Union for the Conservation of Nature Commission on Ecology, in cooperation with the United Nations Environment Programme and the World Wildlife Fund, said that globally vast mangrove areas are being destroyed intentionally and as a secondary result of other activities, largely economic in nature. It said overexploitation by traditional users was the primary reason. And as the world population skyrockets, pushing resource extraction to the limits, destructive action—resulting from clearfelling, diversion of freshwater, conversion to agriculture and aquaculture, salt ponds, settlement mining/mineral extraction,

liquid-waste disposal, solid waste/ garbage disposal, bomb tests, and spillage of oil and hazardous chemicals—are threatening to wipe out all mangrove forests, it warned.

Sand mining, a growing threat

The world’s growing need for sand to whet its appetite for the construction of urban infrastructure is the latest dagger to the mangrove heartland. In Puerto Rico mining for sand and the removal of most of a coastal dune for the construction of a large airport has led to the eventual destruction the last mangrove tract in northern Puerto Rico. As a result, winter storm waves breached the residual dune on repeated occasions, and large amounts of sand were washed into the adjacent mangrove swamp. Defoliation rapidly ensued and trees died where sand deposition was in excess of 30 centimeters.

Globally vast mangrove areas are being destroyed intentionally and as a secondary result of other activities, largely economic in nature.”—Working Group on Mangrove Ecosystems

Mining of sand from coastal dunes or from offshore structures which shelter coastal mangrove swamps continue to this day, if it does not stop, the damage will be irreversible.

Mangrove depletion due to charcoal-making

In the Philippines mangrove destruction for fuel and charcoalmaking has depleted wide tracts of mangrove forests nationwide, Silliman University Marine Biologists Frances T. Bengwayan and Marjho Cardoza said in their report “Current Status and Threats of Philippine Mangals.” They said the Philippines currently has 30 to 40 mangrove species belonging to 15 families which make the nation one of the top 15 most mangrove-rich countries in the world. It holds at least 50 percent of the world’s approximately 65 mangrove species. But many of these are now struggling to survive against human-induced destructive activities, they added. Of the estimated 250,000 hectares of mangrove forests, only 80,000 hectares are left, 40,000 hectares of which are found in Palawan, Bengwayan and Cardoza said. The loss is a result of a mangrove-depletion rate of 2

Fishponds in the Philippines are predominantly used for the culture of milkfish or Chanos chanos. The rapid development has led to the area devoted to fishponds, where mangroves that breed non-fishpond denizens were destroyed to give way to milkfish production. From 1950 to 1962, some 70,000 hectares of mangroves were converted into fishponds. As of 1981, there are 3,300 fishpond operators raising milkfish in 70,300 hectares which were once mangrove areas. The conversion of additional mangrove lands into fishponds has increased fish production from aquaculture, but decreased production from coastal fisheries.

Lessons learned

They say that nature is the best teacher. Indeed, humans have learned the hard way after the chilling 2004 tsunami and 2013 Superty phoon Yolanda (international code name Haiyan) left thousands dead in Asia. Once more people were planting trees in their mangroves from Sri Lanka, Thailand to the Philippines. They fully realized that mangroves form low-lying thickets that hug the shore and protect coastal areas from storms, hurricanes typhoons and storm surges in tropical regions around the world. They serve as natural barriers that help dissipate swelling sea waters propelled by rocket-fast wind and gales. By realizing this, and acting proactively, perhaps people need not to be reminded now and then that caring for the Earth is as important as their other basic needs, without death rearing its ugly head.

Experts begin talks for actions Critically endangered Christmas frigatebird spotted in Apo Reef for healthy oceans, economies By Jonathan L. Mayuga

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panel of influential leaders in the field of economics and finance, coastal and ocean governance, and science has started discussions to develop ambitious and transformative actions to secure the region’s healthy oceans, people and economies. O rg a n i z e d b y t h e Pa r t n e r s h i p s i n Environmental Management for Seas of East Asia, the Ocean Leadership Roundtable Dialogue held recently at a hotel in Makati City, aimed to map out the prospects and outlook for the coasts and oceans of the East Asian region beyond 2020. According to Pemsea, ocean protection is gaining political, social,and economic and ecological prominence with the adoption of the UN Sustainable Development Goals, particularly SDG 14 on life below water. In a statement, Pemsea said the experts provided perspectives on relevant political, economic and social trends and a scientific understanding on how to assess the possible impacts and opportunities of the EAS region post-2020. The dialogue was conducted during the 10th East Asian Seas Partnership Meeting, wherein Pemsea reflected on its body of work on the occasion of its 25th anniversary. As a collective partnership, Pemsea was introspective about its role in responding to global and regional trends, and the types of future institutional and partnership arrangements it should enter into. It was also contemplating about its continuing focus on scaling up and replicating its Integrated Coastal Management approach. “Pemsea’s work in scaling up ICM in East Asia and partnerships with national and local governments, international organizations, intergovernmental institutions and other

stakeholders were commended as relevant contributions to the United Nations Sustainable Development Goal 14. We aim to advance and align our commitment to the Sustainable Development Strategy for the Seas of East Asia with the global ocean agenda,” said Pemsea Executive Director Aimee Gonzales. The Philippines Department of Environment and Natural Resources (DENR) has, likewise, supported the implementation of nationwide projects aligned with the UN SDG 14, or the goal to “Conserve and Sustainably Use the Oceans, Seas and Marine Resources for Sustainable Development.” The discussions during the Ocean Leadership Roundtable session will serve as a lead up to a four-day East Asian Seas (EAS) Congress that will be held from November 27 to 30 in Iloilo City. With the theme “25 years of Partnerships for Healthy Oceans, People, and Economies: Moving as One with the Global Ocean Agenda,” the EAS Congress is expected to draw some 1000 participants from here and abroad. It aims to build on existing partnerships and achievements and promote new initiatives, investments and partnerships to accelerate the achievement of national, regional and global targets for the sustainable development of oceans and coasts. The dialogue speakers included Dr. Chua ThiaEng, chairman emeritus of the EAS Partnership Council; Deborah Robertson, natural resources specialist of the Asian Development Bank; and Dr. Laura David, professor at the University of the Philippines Marine Science Institute. The “EAS Futures Outlook” roundtable session was facilitated by Dr. Antonio La Viña, Pemsea council chairman. Jonathan L. Mayuga

@jonlmayuga

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iodiversit y advocates underscored the importance of protecting and conserving Apo Reef Natural Park (ARNP) in Sablayan, Occidental Mindoro, following the discovery of a critically endangered Christmas frigatebird in June. In a statement, the Mindoro Biodiversity Conservation Foundation Inc. (MBCFI) said the Christmas frigatebird, one of the world’s critically endangered seabirds, was spotted for the first time at the ARNP on June 25. The species was first recorded in the country in Tawi-Tawi in 1995. Since then, a total of 161 individuals have been recorded from the Sulu Sea with only one record from Metro Manila in 2013 and record this year in Panay. The recent sighting at the ARNP makes it only the third record of the species in the Philippines outside of the Sulu Sea. A survey team was taking a break along the beach when Bob Natural, MBCFI monitoring and evaluation officer/biologist, first spotted a single juvenile frigatebird flying overhead. MBCFI Research Program Manager Geoff Tabaranza said the threatened bird was observed soaring over the main island of ARNP

Threatened seabirds—Christmas frigatebird (Fregata andrewsi) and streaked shearwater (Calonectris leucomelas)—photographed in Apo Reef Natural Park off Sablayan, Occidental Mindoro, on June 25 and February 7, respectively. Bob Natural and Djop Tabaranza/MBCFI

during a survey of seabirds, which was conducted in collaboration with the DENR-ARNP Protected Area Office. T he sur vey tallied nesting populations of hundreds of rare Bridled terns (Onychoprion anaethetus) and Black-naped Terns (Sterna sumatrana). Earlier on February 7 MBCFI recorded three individuals of an uncommon near-threatened seabird—streaked shearwater (Calonetris leucomelas) for the first time near ARNP. “This highlights the significance of the ARNP as a conservation site, serving as nesting grounds for seabirds and a stopover feeding site for migratory species,” Tabaranza said. The ARNP is one of the priority projects sites of MBCFI.

The Christmas frigatebirds are large black seabirds measuring up to a meter in length. The juvenile has black upperparts, pale cream head, dark breast band and distinctly shaped white patch in its belly and under the wings. The International Union for the Conservation of Nature (IUCN) has included it in the Red List of Threatened Species as critically endangered—the highest category assigned to species that are at the brink of extinction, Tabaranza noted. According to the IUCN, the species has a small population that breeds in a tiny area of just one island. Its global population is in continuous decline due to hunting and accidental trapping in fishing gear. Other threats include clearing of vegetation in nesting sites,

marine pollution and overfishing. The most recent census from 2003 estimated a globa l population of only from 2,400 to 4,800 mature indiv idua ls. T he IUCN has urged immediate action to prevent the extinction of this species w ith the protection of all know n and potential nesting habitats, including surveys to identif y the extent of its forag ing area. T he MBCFI is pushing for stronger protection measures on Mindoro Island, which it considers “a treasured island,” because of its unique ecosystem and island biodiversity. In 2015, the group revealed and verified its 2013 study, wherein 18 new species on Mindoro Island, including 10 new species of birds, three bats, three fishes, a snake and an owl, were recorded on Mindoro Island. Just last month, on the occasion of its 10th founding anniversary, the group, led by Executive Director Grace Diamante, turned over to the DENR one newly discovered plant species, and a total of eight newly recorded species in the island. Mindoro is a separate biogeographical region from the Philippines, which explains its good number of endemic plant and animal species that are nowhere else to be found in the world.

A10 Monday, August 6, 2018 • Editor: Angel R. Calso

Opinion BusinessMirror

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editorial

Best and worst airlines, airports

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n June the 2018 AirHelp Score report ranked the best and worst airlines and airports. AirHelp is a company that advocates, on behalf of air travelers, just compensation in cases of delays or cancelations. Its sixth annual survey used data from the first quarter of the year to rank the 72 international airlines for which the company had statistically significant data. Before we get all excited—or disappointed as the case may be—there were no Philippine airlines or airports included in the rankings. That’s because the survey comes from AirHelp’s customers who use their services. AirHelp intervenes when passengers have problems with airline travel. Overall rankings are based on three factors: On-time performance, quality of service (gleaned from public reviews on an array of reliable web sites) and a claims-processing score (which reflects how a company handles customer complaints). The AirHelp website said the company provides statistics on the quality of service, on-time performance and the passenger experience of a given airport, thanks to analysis conducted on Twitter. AirHelp said the top 5 airlines are: Qatar Airways, Lufthansa, Etihad Airways, Singapore Airlines and South African Airways. At the bottom were: Korean Air, Ryanair, Air Mauritius, Easyjet and Pakistan International Airlines. There’s an interesting aspect to the rankings. We expect to see Qatar Airways and Singapore Airlines, for example, at the top of the group. These companies have solid reputations of giving the best flight experience. The money that they have spent on delivering the best is also important to note. However, South African Airways get comments like this on Trip Advisor: “CLOSE THIS AIRLINE DOWN” and “Do not fly with South African Airways”. Even on AirHelp, South African Airways’ score—out of 10—for Quality of Service is just 7.8, comparable to those carriers at the bottom of the list. But its score for “On-Time Performance” was the same as that of Singapore Airlines. What made South African Airways stand out in the minds of the public was its “Claims Processing” score, which was better than Lufthansa, Etihad Airways and Singapore Airlines. AirHelp is in the business of assisting passengers to know their consumer rights and to help when claims for compensation are filed against the airlines. In other words, how does a business respond to its customers when errors and mistakes are made? No airline is perfect when it comes to flight delays and cancellations. But does it respond properly and legally to paying its customers for those mistakes? Without exception, all the airlines on the bottom—including Korea Air—treat passengers poorly when problems occur. Korea Air’s Claims Processing score is 3.7. South African Airways had a score of 8.7. As far as the best/worst airports: no surprises there. Qatar and Singapore in the top rankings; Kuwait and Ukraine near the bottom. The lesson for companies is that customers are willing to forgive mistakes as long as they are treated properly when those mistakes happen. So often the comment—particularly with local Internet providers—is not that the service goes down but that customer complaints are ignored and when acted upon, it takes the company days to restore the service. That is unacceptable. Companies that understand how to treat customers well and seriously take the idea of “after-sales service” are the ones that succeed in all economic and business environments. There are always lessons to be learned from those at the top.

On the 9th anniversary of Cory’s death Atty. Jose Ferdinand M. Rojas II

RISING SUN

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ast Wednesday, August 1, the country remembered the ninth anniversary of the death of former President Cory Aquino. She remains in the hearts of many, and we all remember her works, sacrifices and the gift of democracy.

President Aquino died in 2009 due to colon cancer. Her wake was held in La Salle Greenhills on Ortigas Avenue in Mandaluyong City. She was later buried beside her husband, the late Sen. Ninoy Aquino. It would be proper to inform many of our young people today about these events in our recent past, as they may not remember them anymore. A big part of our population today was not yet around when these things happened. Those

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of us who know and those of us who were witnesses have the great responsibility to inform our youth, in the hope of inspiring them and helping them value the freedom that we are all enjoying today. Maria Corazon Aquino was born on January 25, 1933, the sixth of eight children of Jose Cojuangco and Demetria Sumulong. She studied at Saint Scholastica’s College and went to the United States for high school. In America, she studied at Ravenhill

Academy in Philadelphia and Notre Dame Convent School in New York. Many people probably don’t know that the former president graduated with a bachelor’s degree in French (minor in Math). She wanted to become a lawyer upon her return to the Philippines, and so she started taking law classes at the Far Eastern University. She, however, stopped her studies when she married the late senator Ninoy. Tita Cory was the country’s first female president. The one who led the country from dictatorship to democracy after the Edsa revolution of 1986 toppled the 21-year rule of the late President Ferdinand E. Marcos. Nine years after her death, her son, the former President Noynoy Aquino, led the commemoration at the, Manila Memorial Park in Paranaque. The family and some participants wore yellow, Cory’s color. Everyone prayed the rosary for the late president. It may be remembered that, when

legally speaking

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he 1987 Constitution of the Philippines vests judicial power in one Supreme Court and such lower courts as may be provided by law. At present, the Supreme Court is composed of one Chief Justice and 14 Associate Justices, or a total of 15 sitting in three Divisions of five Justices each. This will be drastically increased under the draft “Bayanihan Federalism” Constitution, which proposes to create four Supreme Courts—the Federal Supreme Court, the Federal Constitutional Court, the Federal Administrative Court and the Federal Electoral Court (Article IX, Section 1). Each of these courts will be headed by a Chief Justice— so, we will have four Chief Justices. Each of these Federal Courts, except for the Federal Electoral Court, will have eight Associate Justices. The Federal Electoral Court will have 14 Associate Justices. Thus, under the draft “Bayanihan Federalism” Constitution, the number of Supreme Court Justices will increase from 15 to 42. The number of Appellete Court Justices and Regional Trial Court Justices will likewise increase under the draft Constitution. At present, there is only one Court of Appeals with one Presiding Justice and 68 Associate Justices. Currently, each of the existing 13 Regions, Regions 1 to 12 and the National Capital Region, have as many Regional Trial Court Judges as the law mandates. Under the draft Constitution, this will necessarily increase, as it is proposed that “there be at least one Federal Court of Appeals in each Federated Region (or a total of 18) and at least one Federated District Trial Court in constituent cities and provinces of Federated Regions (Article IX, Section 28). The President, under the draft,

does not appoint all the Justices of the four Federated Supreme Courts. He appoints only the four Chief Justices and two Associate Justices of each of the Federated Supreme Courts. The other three Associate Justices of each of these courts are appointed by the Commission on Appointments and by the Associate Justices themselves (the Federal Constitutional Court en banc appoints the three Associate Justices of the Federal Supreme Court and the five Associate Justices of the Federal Electoral Court; the Federal Supreme Court appoints the three Associate Justices of the Federal Administrative Court and the three Associate Justices of the Federal Constitutional Court (Article IX, Sections 6, 9, 13, 16).

There is no Judicial and Bar Council to vet these appointees, as the draft abolishes the JBC and replaces it with a Judicial Appointments and Disciplinary Council composed of 11 ex-officio members and four regular members (Article IX, Section 19). “Subject to the recommendation of the Judicial Appointments and Disciplinary Council, the Supreme Court [no mention of which Supreme Court] shall appoint all the judges of the lower courts and the Justices of the collegiate courts” (Article IX, Section 29). The Jurisdiction of the Federal High Courts are as follows: “SECTION 8. The Federal Supreme Court shall have the following powers: (a) Exercise original jurisdiction over cases: 1) Involving conflicts between branches and agencies within the Federal Government, conflicts between the Federal Government and the Federated Regions, and conflicts between and among the Federated Regions; 2) Involving ambassadors, other public ministers and consuls; and 3) Involving petitions for certiorari, prohibition, mandamus, quo warranto. (b) Review, revise, reverse, modify or affirm on appeal or certiorari, as the law or the Rules of Court may provide, cases involving: 1) Final judgments and orders of lower courts except those within the exclusive jurisdiction of the Federal Constitutional Court, Federal Administrative Court or of the Federal Electoral Court; 2) The jurisdiction of any lower court; 3) The legality of any tax, impost,

she was still alive, President Cory was very religious. It is said that Mother Teresa of Calcutta herself gave Cory a rosary. In Cory’s resting place, she holds a rosary given by Fr. Sonny Ramirez, OP. Let us keep her memory alive, especially her works and dreams for the people. Most of all, let us protect our democracy. Many martyrs and heroes have died so we could enjoy our freedom. nnn

I would like to congratulate the winners of the PCSO Special Maiden Race (Santa Ana) on July 21: Storm Bell (with jockey JB Hernandez), Caloocan Girl (with RM Garcia), Interstate (with RG Fernandez), Golden Buzzer (with JT Zarate) and Snap Dance (with AP Asuncion). Warm congratulations too to the July 21 PCSO Special Maiden Race winners (Philippine Racing Club Inc. in Naic, Cavite): Storm Bell (with jockey JB Hernandez), Caloocan Girl (with RM Garcia) and Interstate (with RG Fernandez).

assessment, or toll, or any penalty imposed in relation thereto; 4) Criminal offenses in which the penalty imposed is reclusion perpetua or higher; and 5) Error or question of law. SECTION 11. The Federal Constitutional Court shall have the following powers: (a) Exercise exclusive and original jurisdiction over: 1) Disputes involving the constitutionality of a law, treaty, international or executive agreement, including those involving the constitutionality, application or operation of presidential decrees, proclamations, orders, instructions, ordinances and other regulations, administrative issuances by the Federal Government or any of its departments and agencies, as well as the laws of the legislative assemblies of the Federated Regions, and the acts and issuances of their executive departments; and 2) Any dispute or matter involving questions of constitutionality. (b) Exercise original jurisdiction over cases involving writ of habeas corpus, writ of amparo, writ of habeas data and writ of kalikasan. (c) Hear and decide impeachment cases; provided, that a judgment of conviction must be concurred in by at least six members. However, when a member of the Constitutional Court is impeached, the Federal Administrative Court shall act as the Impeachment Court. A judgment of conviction must be concurred in by at least six of its members. SECTION 12. The Federal Constitutional Court may, with leave, render advisory opinion when sought by: See “Kapunan,” A11

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Opinion

Meeting the middle man

How about giving tax incentives to local PPPs?

BusinessMirror

may grant tax exemptions, incentives or reliefs. Local tax imposed can be withdrawn. The private sector proponent for a water distribution, septage, monorail, expressway, reclamation or fiber optic PPP project can enjoy these contractually and by virtue of an ordinance. n Discretion. LGUs cannot be forced to grant these privileges. The law is permissive and gives the LGU the discretion not only to extend the type of privilege but also to set the terms and conditions thereof. Because of local autonomy and the proscription against executive control, the national government or the higher LGU cannot impose the terms and conditions and limit this power. n Executive and legislative requirements. The law requires that the grant of a tax privilege must be embodied in an ordinance, not just a resolution. An ordinance enacted by a local legislative council is pub-

lic in character and is more or less permanent. An ordinance must be approved, and may be vetoed, by the governor or mayor. The ordinance may either be the ordinance approving the terms of the PPP contract enacted prior to signing thereof or an ordinance passed after the PPP contract is signed, which then becomes a condition precedent for the PPP project. n Breadth of privilege. The legislative measure must be specific for a project, must set out the type of tax or taxes withheld and the duration of the tax exemption, incentive or relief. It is advised that the privilege should not be perpetual or for the whole life of the PPP contract, and that what the LGU will “lose” from the tax withheld will be recovered from the revenues it will earn from the PPP project, among other economic and social benefits. It can be done.

dination costs, delays are inevitable due to the increasing effort needed to keep everyone informed and coordinated. People in big group meetings also become less motivated and less productive as they, consciously or unconsciously, do something else during the meeting. Social loafers linger and proliferate. Social loafing refers to the phenomenon where a person exerts less effort to achieve a goal when he is part of a big group. Participants in large meetings are often disengaged to the point that they work on their laptops or tablets, and worse, conduct pocket meetings of their own. Such unconscious disengagement will eventually turn into disconnection and decreased motivation. In the context of the number of Facebook friends, the more friends we have, the weaker those relationships become. I have been a member of the Multi Sectoral Governance Council (MSGC) of the Philippine Air Force

(PAF) for the past two years. The MSGC helps the PAF to acquire some insights and assistance from sectors outside its organization in its quest to accomplish its PAF Flight Plan 2028 —a strategic road map to achieve a competent and credible Air Force in the country. Other members of the MSGC include Professor Confessor, Atty. Toledo, Commissioner de Vera, Senator Legarda, Senator Aquino, Asec Canda, and Mr. Goseco. Chaired by former Secretary of National Defense, Gilberto “Gibo” Teodoro Jr., previous meetings of the MSGC were very formal, long and attended by no less than 30 field grade officers of the PAF. A week ago, Chairman Gibo decided to go small, in terms of participants, venue and presentations. For me, it was the most productive MSGC meeting thus far. Ideas, comments and suggestions flowed much freely. The discussion stayed connected to the very concise PowerPoint presentation done by the PAF Strategic Management Office. Most important, the meeting was done in less than 90 minutes.
 When Jesus began His discipleship, He didn’t invite and gather a large group of people to become fishers of men. Instead, he chose only 12 disciples to help Him in spreading the Gospel. While Jesus performed miracles in large gatherings, He noticeably preferred sharing parables to small groups. The apostle Paul used the same approach, as well, perhaps by necessity, as he traveled to various cities to spread Christianity. In the Bible, 2 Timothy 2:2 tells us, “And the things you have heard me say in the presence of many witnesses entrust to reliable people who will also be qualified to teach others.” I can only imagine how difficult it would be to identify reliable people in such a large group, much more qualify them. I think that whatever

we share to a smaller group is understood much easier and absorbed much better. In the Bible, Mark 4:3334 tells us, “With many similar parables Jesus spoke the word to them, as much as they could understand. He did not say anything to them without using a parable. But when He was alone with His own disciples, He explained everything.” While Jesus spoke to large gatherings, He also saw the importance to go into the little details with a smaller group—His 12 disciples. Gibo ended the meeting with command guidance, popularly known as closing remarks in the civilian world, which recapitulated all the items highlighted by the members of the MSGC. Instead of 30 PAF officers, there were only five key PAF officers in that meeting. Chairman Gibo gave the PAF leadership what it needs to accomplish the tasks at hand. He gave the generals time for comprehension, reflection and implementation of the Flight Plan 2028. I am certain the PAF Commanding General, Lt. Gen. Galileo Kintanar Jr., will properly cascade down the chain of command what was discussed in that MSGC meeting. Whether the meetings are done in the private or government sector, I think smaller is better. I agree with Jeff Bezos that two-pizza group meetings are more cost-effective. In smaller groups, we communicate better and open up channels for more meaningful conversation. More important, we strengthen emotional connections at work by way of more engaging discourses, which somehow lead to creative ideas, open suggestions, and deeper discoveries. So let’s follow the two-pizza rule. We can transform a business meeting from being a wasteful activity into a soulful exercise.

sion on Human Rights, the Federal Ombudsman Commission, and the Federal Competition Commission, and of all administrative and quasijudicial bodies in the Federal Republic. (b) It shall, with leave, render an advisory opinion, if sought by any political party to determine whether the Federal Commission on Elections has complied with the processes, procedures, and preparations relative to the conduct of any election, which may materially affect its results. (c) It shall appoint all officials and employees of the Federal Administrative Court in accordance with the Civil Service Law and exercise administrative supervision over all its personnel. This includes the power to dismiss and suspend its officials and employees upon recommendation of the Judicial Appointments and Disciplinary Council. SECTION 18. The Federal Electoral Court shall have the following powers: (a) Exercise exclusive original jurisdiction over all contests relating to the elections, returns, and qualifications of the President Vice President, Members of both Houses

of Congress; provided, that contests relating to the President and Vice President shall be decided by the Federal Electoral Court en banc; provided further, that contests relating to the members of Congress shall be heard and decided by the Federal Electoral Court in division and proceedings shall be held within the region where the case arose. Decisions of the Federal Electoral Court shall be reached by the concurrence of a majority of the Court en banc or in Division as the case may be. Any decision of the Court in Division may be elevated to the Court en banc only on questions of law in accordance with its rules of procedure. (b) Exercise exclusive jurisdiction to review, on appeal or certiorari, all decisions, resolutions and orders of: 1) Trial courts of proper jurisdiction in all contests relating to the elections, returns and qualifications of other elective regional, provincial, city, municipal and barangay officials; and 2) The Commission on Elections with respect to all questions affecting elections, including the qualifications of candidates and political

parties, and other pre-election controversies, and the conduct of plebiscites and referenda;” While the intent of the draft proposals may be “the effective administration and speedy delivery of Justice,” it is apparent from just a cursory reading of these proposals that this noble objective might not be achieved. The jurisdiction among the federal, regional, district and lower courts is not clear and has several overlaps; the addition of Courts and personnel will create bureaucratic red tape; the cost of maintaining this justice system will create undue burden to the taxpayers; no mandatory time limits or periods have been provided within which cases should be decided at each level; the ordinary citizen will have to hire a lawyer to get through these maze of courts and legal procedures. Conventional wisdom dictates that “if it ain’t broke, don’t fix it!” We don’t need a new judicial system—we just need to clean the system of corruption, incompetence, inefficiencies and delays. And to put to jail all the rotten people in our judicial system!

By Alberto Agra

General Butley A. Organiza

PPP Lead

DEBIT CREDIT

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hen we say business, we only perceive two parties: the buyer, and the seller. It is always these two who get to tell the story in different transactions we encounter every day. The buyer buys the goods and pays the seller; the seller sells the goods and expects money in return from the buyer. Even in academe, these two are always the protagonists in a problem. Very much away from the theories and hypothetical situations in the books, it turns out that there is another party who makes these transactions happen. We call it “the middle man” or simply, logistics. Those involved in logistics are the ones who are responsible for delivering the goods from one party to another. We encounter the middle man in our accounting lessons back in college under the name of “freight charges,” “freight costs” or simply “freight.” These are the costs that the middle man charges a company every time he is tasked to move goods from one location to another. Middle men are people who know the roads and ways very well. They know which roll-on, roll-off ship sails next, the time it arrives in a specific place, the kind of mode of shipment most appropriate for a specific commodity or good to be shipped, the trucking requirements needed to meet deadlines, and which costs are going to be passed on to the client. You might think, “Who would want to operate a company that only forwards goods from one party to another? Who would want to be the middle man?” The Philippines is an archipelago, made up of small islands, separated by sea. There are different companies throughout the country. There will be companies on the outskirts of Davao, Cebu, Tagbilaran, Iloilo, Bacolod, Surigao, Butuan, Tacloban and all other places that are separated by sea. These companies will need someone to move their goods from one place to another, especially those companies who own different branches in far away places. With these, we can say that the freight-forwarding industry would be such a lucrative business to get into.

Now you’re asking, “What would be a CPA’s place in a freight-forwarding company?” We, as CPAs, play a huge role in a logistics company. We mostly would tap on the Management Accounting side of the company. We examine old and new rates being charged to different clients, we compare margins for every transaction and destination, we decide on which locations would be serviceable, and at the same time which locations would be the most profitable. There are also other roles for CPAs in a logistics company like budgeting the expenses of the whole company, verifying billing statements being charged to clients, monthly operational audits and inspections, inventory count of the client’s goods in the warehouse, and even making claims and damages reports for the upper management of the company. This industry is thriving alongside other industries, as well. We might have overlooked this industry during our college days, but this industry is set to be one of the most lucrative industries in the future since more and more outlets are opening their doors for e-commerce (examples are Lazada and Shopee), and online stores are starting to bloom. They would need a freight-forwarding company to ship their goods to their customers. With this projection, these companies would need the help of CPAs in order to understand numbers. As the middle men handle the operations, we, CPAs, sit behind and analyze the numbers for better decision making and goal achievement. General Butley A. Oganiza is working as an Accounts Assistant/CPA at the Sales Department of Ximex Delivery Express, a freight-forwarding company.

The story of Apple’s supply chain By Tim Culpan Bloomberg Opinion

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pple Inc.’s rise to become a $1trillion company is a story of innovation, new possibilities and one iconic product. A posse of suppliers and partners has been part of the journey by selling key components, assembling the devices or simply connecting iPhones to their networks. I took a selection of these companies and analyzed how they fared in comparison to the superstar they shadowed over the past 11 years—from the time Apple hit a $100-billion valuation in May 2007 to last week when it became what we might call a trunicorn. It’s not a complete list, merely a sample of Cupertino’s large entourage. Two companies stand out as crucial parts of Apple’s supply chain throughout that time. Taiwan’s Hon Hai Precision Industry Co., a.k.a. Foxconn, is without a doubt the iPhone inventor’s most important partner. Not only has it been the chief assembler of the devices, it also makes a lot of the components, including metal casings and display modules. Yet Hon Hai’s upside from Apple’s success has been minimal. Chairman Terry Gou has consistently failed to leverage his pole position in the supply chain into superior revenue, net income and market-cap growth, especially when compared to Samsung Electronics Co. South Korea’s biggest company had an early relationship with Apple, supplying flash storage chips back in the iPod era. It then became a primary supplier

of the core processor in iPhones. After Apple dragged smartphones into the 21st century with hardware and software innovations, Samsung followed—indeed, Steve Jobs accused it of copying—to become the world’s biggest maker of the devices. The South Korean company’s rise hasn’t matched that of Apple, but it’s done exceedingly well. Thanks to this explosion in smartphones, hitherto unknown suppliers like Shenzhen-listed O-Film Tech Co. and Largan Precision Industry Co. of Taiwan got their shot at glory, and they took it. They’re not alone. Apple lists more than 200 suppliers in its annual supply chain report. Both of these companies have since won orders from non-Apple clients, helping them keep the growth momentum. Meanwhile, telecom companies like AT&T Inc. were set to benefit from demand for faster networks due to the popularity of social media and mobile video. This didn’t quite pan out as expected. As my colleague Shira Ovide pointed out last week, profitability is the cloud hanging over Apple. Some of its entourage face similar headwinds. Hon Hai’s margins have shrunk, as have O-Film’s. Yet Samsung and Largan have managed to keep expanding profitability by balancing R&D and other costs with the development of products for which clients are willing to pay a premium. In the future, the key for all of those in the Apple posse will be how to offer products of such value that the hippest clients can’t do without them. That may even mean dumping Apple itself in order to find a new megastar.

Continued from A1

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oday’s topic is about an LGU’s authority to give “tax incentives or tax holidays” for its PPP project or a project by another government agency. The build-operate-transfer law (BOT law) also allows this form of direct government subsidy. This can be a form of support or contribution to a joint venture, lease or concession PPP. n Local taxes. Under the 1991 LGC, Congress allocated the taxes provinces, cities, municipalities and barangays can levy. Provinces and cities can, among others, impose real property, franchise, and sand

and gravel taxes, while cities and municipalities can impose business taxes. n Tax privileges. Under Section 192 of the same law, there are three forms of local tax privileges. LGUs

Two-pizza
rule
 Siegfred Bueno Mison, Esq.

THE PATRIOT

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E have all experienced wasteful and time-consuming meetings. Some of the unproductive meetings that I have attended were poorly planned. But one of the most unproductive meetings I have experienced was due to poor chairmanship—when the presiding officer could not control the participants due to sheer number. I have been in a few meetings with too many people in attendance. Some say the larger the group, the more difficult the decision-making process becomes due to the great number of opinions shared or exchanged. I have attended meetings where participants enjoy hearing their own voice. Those meetings were wasteful in terms of executive time. I believe that attention levels diminish in large meetings, and participants are less engaged. Amazon founder and CEO Jeff Bezos frowns upon large group eetings. He instituted a rule that every internal team meeting should be small enough to be fed with two pizzas. According to Bezos, if participants could not be fed with two pizzas, there are too many participants. With the two-pizza team meeting rule, diverse viewpoints are still obtained, participants are better engaged, and the time spent exchanging ideas becomes manageable. Janet Choi, the chief creative officer of iDoneThis, said “while larger teams may be getting more things done altogether, it’s happening at a rate lower than the sum of individual efforts.” And that process is far from being cost-effective. She said that coordination costs, motivation costs and relational costs are to be seriously considered whenever companies prefer to have larger group meetings. In terms of coor-

Kapunan. . .

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(a) The President, Senate President or Speaker of the House of Representatives on the constitutionality of any enrolled bill of paramount importance; Provided, that the favorable opinion of the Court notwithstanding, and when such bill has become a law, any citizen of the Philippines may still question the validity if he claims it is unconstitutional as applied to him; (b) The Chairman of the Federal Commission on Elections on the constitutionality of any proposal to amend or revise the Constitution or enact, amend or repeal any federal law by people’s initiative. SECTION 15. (a) The Federal Administrative Court shall exercise exclusive jurisdiction to review on appeal or certiorari, in accordance with its rules, the decisions, judgments, or final orders or resolutions of the Federal Civil Service Commission, the Federal Commission on Elections, the Federal Commission on Audit, the Federal Commis-

Monday, August 6, 2018 A11

2nd Front Page BusinessMirror

A12 Monday, August 6, 2018

House, DOF rush unified version of tax Package 2

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By Jovee Marie N. dela Cruz

@joveemarie

EMBERS of the House Committee on Ways and Means’s technical working group (TWG) and officials of the Department of Finance (DOF) have started consolidating all related tax proposals filed in the lower chamber, and were eyeing, at press time, to produce one version of Package 2 of the Duterte administration’s Comprehensive Tax Reform Program by late Sunday (August 5). The office of Speaker Gloria Macapagal-Arroyo said members of the TWG are eyeing to produce a consolidate copy of the second package of the new tax reform by Sunday—hoping to address all the concerns in two TWG hearings which started last Saturday. Present during the hearing were Arroyo, House Committee on Ways and Means Chairman Dakila Carlo Cua of Quirino, Economic Affairs Chairman Arthur Yap of Bohol, former Ways and Means Chairman Romero Quimbo of Marikina, Nueva Ecija Rep. Estrelita Suansing,

Sultan Kudarat Rep. Horacio Suansing, Bataan Rep. Jose Enrique Garcia, Aambis-OWA Rep. Sharon Garin, Pampanga Rep. Aurelio Gonzales, Paranaque Rep. Gus Tambunting and Batangas Rep. Raneo Abu. Also at the meeting were representatives from the DOF led by Undersecretary Karl Kendric T. Chua. Quimbo said several issues need to be resolved, but they will address them in a “marathon meeting” this Sunday. Last Thursday the ways and means panel approved “in principle”

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The number of bills filed in the House seeking to reduce corporate income tax and rationalize fiscal incentives the measure, which was designed to be revenue-neutral. It proposed to gradually lower the corporate income tax (CIT) rate from 30 to 25 percent, while rationalizing fiscal incentives for companies to make these performance-based, targeted, time-bound and transparent. Currently, there are 12 bills filed in the lower chamber seeking to reduce CIT and rationalize fiscal incentives. However, Cua’s version of the second tax reform will be used as the main bill. Earlier, Cua said his panel is working double time to pass the package as it was declared a priority bill of both Arroyo and President Duterte. According to the lawmaker, the country’s fiscal incentives must be modernized to ensure that these are more “responsive, targeted, and transparent.”

One of the authors of the bill, Albay Rep. Joey Salceda, meanwhile, said the bill seeks to lower the corporate tax rate, as well as widen the corporate tax base and plug its tax leakages, through rationalizing the administration of tax incentives. He said the country’s income-tax system is characterized by a narrow base and a high rate of 30 percent, the highest in the Asean region. He said the country’s investment tax incentive system is characterized by “complexities and [an] overly liberal mind-set” with little regard for cost efficiency and effectiveness. However, Quimbo has said corporate income-tax reduction cannot be conditioned on the overhaul of or removal of most tax incentives, as it amounts to a “hostage” situation. “We cannot make the reduction of corporate income taxes contingent on removal of fiscal incentives. The DOF’s ‘revenueneutral’ strategy, as shown by the effects of TRAIN [Tax Reform for Acceleration and Inclusion] 1, has not produced the desired effects,” said Quimbo. According to Quimbo, CIT reduction is an urgent concern that affects the country’s competitiveness.

DOLE to help repatriate distressed OFWs seeking amnesty in UAE

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HE Department of Labor and Employment (DOLE) said on Sunday that it is ready to aid in the repatriation of over 100,000 distressed overseas Filipino workers (OFW), who are expected

to avail themselves of the amnesty program of the United Arab Emirates (UAE). In a statement, Labor and Employment Secretary Silvestre H. Bello III said the Overseas Workers Welfare Adminis-

LOW PRESSURE AREA 1,335 KM EAST OF APPARI, CAGAYAN SOUTHWEST MONSOON AFFECTING SOUTHERN LUZON AND VISAYAS as of 5:00 am - August 5, 2018

tration (OWWA) will provide airport and cash assistance to the repatriates. He also said the concerned OFWs could also be given local and overseas employment referral, livelihood assistance, legal

and conciliation services, competency assessment and training assistance once they arrive in the country. Bello made the assurance to persuade the thousands of OFWs, who “overstayed or escaped from their employers,” to either return to the country or legalize their stay in UAE during the amnesty period. “Under the amnesty program or the ‘Protect Yourself via Rectifying Your Status,’ all foreigners violating the residency regulation are given a chance to either leave UAE voluntarily without prosecution or legalize their status by paying the required fees,” Bello said. The amnesty period started this month and will end on October. Citing data from the Department of Foreign Affairs, DOLE said 87,706 undocumented or overstaying Filipino workers in Abu Dhabi and 14,400 in Dubai could avail of the amnesty. Bello said these OFWs could visit the Philippine Embassy. Samuel P. Medenilla

www.businessmirror.com.ph

Eternal Gardens spreads devotion to the Transfiguration of Jesus

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ASSES have been scheduled at the 10 branches of Eternal Gardens in celebration of the Feast of the Transfiguration of Jesus today. They will be attended by Eternal Gardens sales force members, officers, staff and crew. This is also the branches’ celebration of the 42nd Anniversary of the company, which is on August 11, 2018. The Christian community celebrates the Feast of the Transfiguration of Jesus, one of the most important and meaningful events in Christ’s life on Earth. The Transfiguration is a miracle considered unique by the church as it happened to Jesus Himself. When Jesus allowed the apostles to witness this miracle, He revealed before mortal eyes the transcendent truth of who He is—and who each one of us will become in Him. Likewise, the Transfiguration provided a preview of Christ’s impending resurrection and showed the perfection of life in Heaven. Accounts of this event are found in three of the four Gospels: Matthew 17:1-9; Mark 9:2-8; and Luke 9:28-36. The accounts tell of how Jesus, one day, went up on a mountain with apostles Peter, John, and James, and there was transfigured. Christ’s face shone as brightly as the sun, and His garments turned glistening white. As He was transfigured, Moses and Elijah appeared beside Him, representing the Old Testament and the prophets, respectively. The sight of Christ standing between the two and speaking with them appeared to the disciples as the fulfillment of both the Law and

the prophets. During the Transfiguration, God the Father was heard pronouncing, “This is my beloved Son” (Matthew 17:5), the very same words that God the Father was heard proclaiming during the baptism of Jesus in the Jordan (Matthew 3:17). Eternal Gardens has embraced the Transfiguration as its corporate symbol, thus becoming an active partner of the church in promoting the devotion to the venerated image and affirming our faith in eternal life. This self-assumed task of the company is also reflected in its corporate slogan, “a glimpse of heaven on a patch of earth.” The very first image of the Transfiguration of Jesus rose at the pioneering branch of Eternal Gardens in Baesa, Caloocan City, which officially opened on August 11, 1976. The towering image, made of steel and bronze, and designed and executed by National Artist Napoleon Abueva, has become a famous landmark in the area where the North Expressway starts. Following the first park, nine more Eternal Gardens branches were opened and each of them has a version of the iconic statue of the Transfiguration of Jesus. These branches are in Dagupan City, Pangasinan; Biñan City in Laguna; Barangays Balagtas and Concepcion in Batangas City; Lipa City, Naga City, Cabanatuan City and Santa Rosa City, Laguna; and in Cagayan de Oro City. Soon an 11th Eternal Gardens park will rise, this time in Cabuyao City, which will give the Province of Laguna its third Transfiguration of Jesus.

MOODY’S UNIT SEES Q2 GROWTH AT ABOVE 6%, BUT FLAGS INFLATION By Bianca Cuaresma @BcuaresmaBM

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HE Philippine economy likely grew above 6 percent in the second quarter of the year, an international research firm said, but price movements will “need watching.” In its most recent economic preview for the Asia Pacific, Moody’s Analytics— the research arm of Moody’s Corp.— said gross domestic product (GDP) growth in the country likely “softened a little” from April to June this year, but the think tank remained optimistic of growth drivers in the country. In particular, Moody’s Analytics forecasted a 6.6-percent growth number for the country in the second quarter of the year, from the actual 6.9-percent growth in the first three months of 2018. “The Philippine economy likely grew 6.6 percent year-on-year in the June quarter, after a 6.9-percent lift in the first three months of the year. Consumer spending is healthy, thanks to steady inflows of overseas worker remittances and a firm labor market,”

Moody’s Analytics said. “Investment has been robust and is likely to remain strong, as the government boosts infrastructure development. External demand has remained solid,” it added. The Philippine Statistics Authority is expected to release the country’s second-quarter growth number on Thursday.

Warning on inflation

Despite the optimism on growth drivers, Moody’s Analytics gave a warning on the rising inflation numbers of the country. “Although these factors likely supported 6.6-percent GDP growth in the second quarter, rising price pressures will need watching. Headline inflation is at a five-year high and is well above Bangko Sentral ng Pilipinas’s (BSP) target band of 2 percent to 4 percent, which has prompted two policy rate hikes this year,” the research firm said. Coincidentally, the BSP is also scheduled to have its fifth monetary policy-setting meeting on Thursday.

The country’s latest inflation average is at 4.3 percent in the first six months of the year—where June registered the highest monthly print at 5.2 percent. Just last week, the BSP said inflation will likely fall within 5.1 to 5.8 percent in July this year. Should inflation in July hit the lower end of the BSP’s forecast for the month, the average price growth for the first seven months of the year will hit 4.4 percent. On the other hand, if inflation hits the upper end of the BSP’s forecast, price growth will hit an average of 4.5 percent for the January-to-July period. Both scenarios are still a breach of the BSP’s 2 percent-to-4 percent average target range of the BSP for the year and for 2019. In their June policy meeting, BSP officials agreed to adjust their average inflation forecast for the year from 4.6 percent down to 4.5 percent, taking into account the lower-than-expected inflation outturn in May. The BSP Monetary Board will reassess this in their upcoming meeting on August 9.