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Wednesday, December 6, 2017 Vol. 13 No. 56

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Universal counterterrorism, an existential requirement

Teddy Locsin Jr.

By Cai U. Ordinario @cuo_bm & Bianca Cuaresma @BcuaresmaBM

ilipinos could pay more for consumer goods next year due to the increase in the price of crude oil, local economists and the National Economic and Development Authority (Neda) said on Tuesday.

Manila, Washington hold exploratory talks on FTA

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anila and Washington are now exploring a potential free-trade agreement (FTA) to deepen the economic relationship between the two countries, as discussed by President Duterte and US President Donald J. Trump in their meeting last month. In a joint statement on the 7th US-Philippines Bilateral Strategic Dialogue, Manila and Washington had extensive discussions on the possibility of cooperating in science and technology, agriculture and fisheries, and health and environment. On the sidelines of the 31st Association of Southeast Asian Nations (Asean) Summit and Related Summits in Manila, Duterte sought to fast-track the conclusion of a US-Philippines FTA. “ They welcomed the bilateral Trade and Investment Framework Agreement [Tifa] discussions held on November 29, and look forward to more robust discussions on ways to expand free, fair and reciprocal bilateral trade, including through exploring a potential FTA,” the statement read. Delegations from both countries also discussed and reaffirmed their commitment to deepen their collaboration in maritime security, humanitarian assistance and disaster response, and cybersecurity. Commitments to cooperate on countering transnational drug trafficking, countering terrorism, and improving drug prevention and treatment services, as well as combating wildlife trafficking and illegal, unreported and unregulated fishing were also reaffirmed during the dialogue. The joint statement also said the two countries discussed their “shared

concerns” on the security challenges in the region and pledged to cooperate in ending North Korea’s ballistic missile and nuclear programs. “Both sides reiterated their commitment to uphold freedom of navigation and overflight and other lawful uses of the sea in the South China Sea, and stressed the importance of peacefully resolving disputes in accordance with international law, as reflected in the Law of the Sea Convention,” the statement read. Acting Assistant Secretary of State for East Asian and Pacific Affairs Susan Thornton and Acting Assistant Secretary of Defense for Asian and Pacific Security Affairs David Helvey co-led the US delegation. Department of Foreign Affairs Undersecretary for Policy Enrique A. Manalo and Department of National Defense Undersecretary Ricardo A. David Jr. co-led the Philippine delegation. The next Bilateral Strategic Dialogue will be held in Manila next year. The dialogue had four working groups convened to develop action plans for expanding the partnership on defense and security; economics, development, and prosperity; regional and global diplomatic engagement; and rule of law and law enforcement. Last month Manila pushed to fasttrack the US-Philippines FTA after Trump raised concerns regarding the high tariff rates imposed on American-made cars compared to Japanese vehicles. Presidential Spokesman Harry L. Roque Jr. told reporters that this was part of the meeting between President Duterte and President Trump which lasted for over 40 minutes. Continued on A12

PESO exchange rates n US 50.5570

free fire An expanded version of a Philippine statement delivered by Ambassador Teddy Locsin Jr. at the United Nations General Assembly, New York.

The Philippines’s headline inflation in November

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Socioeconomic Planning Secretary Ernesto M. Pernia said production cuts that would be implemented by members of the Organization of the Petroleum

e thank the secretary-general for his report on this item. I wish to tell you the story of Marawi City. Last May 23 hundreds of men belonging to a Daesh-inspired terrorist organization, called the “Maute Group,” attacked Marawi, a Muslim-majority city in Central Mindanao.

See “Inflation,” A2

Continued on A10

BMReports

PHL pre-need insurance industry: Reconciling past for brighter future By Rea Cu

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@ReaCuBM

mand for pre-need plans remains significant because of the Filipino’s desire to provide for the present and future needs of their families,” Lorica added.

Conclusion

HE Insurance Commission has shared the enthusiasm of the Philippine Federation of Pre-Need Plan Companies Inc. (Pre-Need Federation). The reason for its upbeat attitude is the entry of new players to the industry. The IC told the BusinessMirror that it had granted a license to one company this year: Cosmopolitan Climbs Life Plan Inc. (CCLPI). Based on IC data, the regulator has, as of end-September this year, granted licenses to sell pre-need insurance products to 16 companies. According to Pre-Need Federation President Elmer M. Lorica, there are three companies eyeing to enter the industry. Aside from CCLP, the other two are Golden Haven Memorial Park Inc. and Diamond Life Plan Inc. “[The application of] Golden Haven and Diamond Life Plan are being processed and for submission of their requirements for licensing,” Lorica told the BusinessMirror. The IC said an applicant failed to comply with capitalization requirements, which resulted to the denial of its license. The IC said it has yet to receive the application of another firm. “A company manifested that it will apply for a new license to act as a pre-need company, but the

New products

Mothers carry their child in a traditional way in Nueva Vizcaya province. They are just a few of the many who aspire to give a better future to their kids and loved ones. A pre-need insurance is just one of the many tools to fulfill their dreams. NONIE REYES

company has yet to formally submit its application,” the IC said.

Required capital

UNDER Republic Act 9829, or the Pre-need Code, pre-need insurance companies that started operations after the enactment of the code shall have a minimum paid-up capital of P100 million. Existing pre-need insurance companies, on the other hand, are required to comply with the following minimum unimpaired paid-up capital: P100 million for those selling at least three types of pre-need

insurance products, P75 million for those selling at least two types of plans and P50 million for those only selling one type of pre-need insurance plan. “Existing pre-need companies with traditional education plans shall have a minimum unimpaired paid-up capital of P100 million,” the Pre-need Code said. Earlier, Lorica urged pre-need insurance companies to continuously innovate and respond to the needs of the public. “Despite the setbacks suffered by the industry in the past, de-

ASIDE from the expansion in the number of pre-need insurance companies in the country, the PreNeed Federation is also eyeing to implement a number of proposals on how to further develop the industry. Among the proposals being looked into is the introduction of new pre-need insurance products. The Pre-Need Federation is the umbrella organization of all preneed insurance companies in the country. Under Presidential Decree 52 of 2001, it declared the first week of the month of February of every year as the “Pre-Need Consciousness Week” in order to increase awareness and appreciation of the Filipino people on the pre-need insurance industry and its vital role in securing the future. In February this year, the IC encouraged pre-need insurance companies in the country to capitalize on the technological advancements of the digital age to further improve their products and services. Insurance Commissioner Dennis B. Funa had solicited the help of the Philippine pre-need insurance Continued on A2

n japan 0.4494 n UK 68.0801 n HK 6.4675 n CHINA 7.6409 n singapore 37.5191 n australia 38.3879 n EU 59.9555 n SAUDI arabia 13.4811

Source: BSP (5 December 2017 )

A2 Wednesday, December 6, 2017

BMReports BusinessMirror

PHL pre-need insurance industry: Reconciling past for brighter future Continued from A1

industry to help the IC find new innovations and capitalize on technology to offer better pre-need insurance products and services to Filipinos. “As such, the use of technology advancements in order to offer and render services applies not only in insurance but also in the pre-need industry,” Funa said.

IC memo

UNDER the Pre-Need Code, insurance companies must register their respective contracts and plans within 45 days after the grant of its license. “Within a period of 45 days after the grant of a license to do business as a pre-need company, and for every

pre -need pl a n t h at t he pre -need company intends to offer for sale to the public, the pre-need company shall file with the Commission a registration statement for the sale of pre-need plans pursuant to this Code,” the Pre-Need Code said. Last year the IC issued circular 201557, which defines what constitutes a preneed insurance product so as to stop the proliferation and unauthorized sale of memorial plans in the country. Under former Insurance Commissioner Emmanuel F. Dooc, Circular Letter 2015-57 was issued, prescribing all entities selling pre-need insurance plans to seek prior accreditation from the IC, and that all pre-need insurance products need prior approval before these may be

PSA reports 8% decline in residential projects in Q3 Continued from A12

billion comprised 74.5 percent of the total. The National Capital Region (NCR) occupied the top slot in terms of value of construction, estimated at P20.4 billion, or 28.3 percent of the total. Other regions on the top 5 list for the third quarter of 2017 were Calabarzon with P14.1 billion, or 19.5 percent of the total; Central Luzon P7.4 billion, or 10.2 percent; Central Visayas P6.6 billion, or 9.1 percent; and Davao region P5.3 billion, or 7.3 percent. In terms of number of construction, the top 5 regions comprised 61.2 percent of the total. Calabarzon led other regions with a total of 9,644, or 26.7 percent of total constructions. Central Luzon ranked second with 3,642, or 10.1 percent constructions. Other regions in the top 5 in the third quarter of 2017 were NCR with 3,050, or 8.5 percent of constructions; Region 7, or

Central Visayas with 3,038, or 8.4 percent; and Davao region with 2,711, or 7.5 percent of the total. “At the provincial level, the top 10 provinces in terms of the number of construction projects accounted for 47.6 percent of the total. Cavite topped the list of provinces with 4,793 [13.3 percent] of constructions,” the PSA said. This was followed by Cebu and Laguna, with respective shares of 1,926, or 5.3 percent of the total, and 1,635, or 4.5 percent of constructions. Completing the top 10 provinces with the most number of constructions are Batangas with 1,593, or 4.4 percent; Bulacan with 1,433, or 4 percent; Davao del Sur with 1,345, or 3.7 percent; the Fourth District of NCR with 1,341, or 3.7 percent; Bohol with 1,071, or 3 percent; Rizal with 1,049, or 2.9 percent; and Negros Oriental with 999, or 2.8 percent.

sold or advertised. The IC came up with an advisory against three companies selling pre-need memorial plans without authorization, namely: Freedomlife Insurance Co. Inc., Prime Care Kaagapay and DMS 1955.

Regulatory tack

PRE-need insurance plans are contracts that provide for the performance of future services to their policyholders, the payment of monetary considerations or delivery of other benefits at the time of actual need or agreed maturity date, in exchange for cash or installment amounts with or without interest or insurance coverage. Pre-need insurance plans include life, pension, education, interment and other

contracts or deeds as may be determined by the IC in the future. The supervision of the pre-need insurance industry was transferred in 2008 to the IC from the Securities and Exchange Commission. The IC under the Pre-Need Code was given the power to regulate the industry. “All pre-need companies, as defined under this Act, shall be under the primary and exclusive supervision and regulation of the IC. The Commission is hereby authorized to provide for its reorganization, to streamline its structure and operations, upgrade its human-resource component to enable it to effectively and efficiently perform its functions and exercise its powers under this Code,” the Code said.

One ticket, all fees, all in: Tieza-Cebu Pac deal eases air travel Continued from a12

According to Civil Aeronautics Board data, Cebu Pacific flew 2.45 million total passengers in the first quarter of 2010, nearly 110,000 more than Philippine Airlines, which carried 2.34 million system-wide during the same period. On January 6, 2011, Cebu Pacific flew its 50 millionth passenger, from Manila to Beijing. The airline aimed to reach the 100 million passengers mark in 2015. Cebu Pacific is planning to commence inter nat iona l long-hau l f l ights to t he Middle East, the United States, Australia and some parts of Europe using the Airbus A330-300. The first long-haul f light was launched in Dubai, the United Arab Emirates on October 7, 2013. It is also applying for rights for a daily service to Auckland, New Zealand. In June 2011 Cebu Air Inc. announced that it was purchasing 30 Airbus A321 neos and seven Airbus A320s for $3.8 billion, allowing it to more than double its fleet by 2021 and expand its international routes. The A320s would be delivered between 2015 and 2021, while the A321neo fleet would arrive from 2017 to 2021.

The airline also took 10 additional options for the Airbus 321neos. Previous outstanding orders for 18 A320s to be delivered through 2014 brought the total Airbus order to 55. In June 2015 at the 2015 Paris Air Show, the airline announced an order for 16 ATR 72-600 aircraft to meet growing demand for interisland services. Tieza is the principal government agency responsible for the timely collection of travel taxes. Its mandate is to develop, manage and supervise tourism infrastructure projects in the country, as well as supervise and regulate cultural, economic and environmentally sustainable development of tourism-enterprise zones. The money collected by Tieza is distributed in the manner provided by the national government. Five percent of the total collection is earmarked for development of historic, cultural, religious and heritage sites and prime tourist destinations. Another 5 percent of revenues are also allotted for the improvement of ecotourism sites in emerging provinces with strong tourism potentials.

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Inflation. . .

Continued from A1

Exporting Countries (Opec) in 2018 would hike the price of imported crude oil. On the domestic front, Pernia said higher electricity rates and more expensive coal and local fuel would continue to exert pressure on inflation in the near term. “Over the near-term, we still expect risks coming from both domestic and external fronts,” said Pernia, who is also the Neda chief. “Overall, however, the inflation outlook for full-year 2017 remains supportive of the current growth momentum of the country.” University of Asia and the Pacific (UA&P) School of Economics Dean Cid Terosa said the Tax Reform for Acceleration and Inclusion (TRAIN) measure could also increase the prices of goods. Terosa said the provisions of the TRAIN bill, particularly the increase in excise taxes, will be the “biggest contributor” to higher inflation next year. He said its passage could create a “domino effect” and impact not only transportation cost but also the prices of food items. “The tax reform will help catapult inflation to 3.8 to 4.3 percent next year,” Terosa told the BusinessMirror. “It will raise trade and transportation margins, thereby raising food prices.” Filipinos had to contend with higher prices of goods in November as inflation during the month rose to 3.3 percent, from 2.5 percent last year. While this was slower than the 3.5 percent posted in October, Pernia said inflation could settle “slightly above” the midpoint of the government’s inflation target of 2 percent to 4 percent. Inflation averaged 3.2 percent between January and November. The highest inflation for the year was recorded in October. “Inflation during the last 11 months suggests that the full-year average might settle slightly above midpoint, but will still be well within our target of 2 percent to 4 percent. This already considers expected price spikes owing to holiday-season spending this December,” Pernia said. The Neda said nonfood inflation slightly increased to 3.3 percent in November 2017, from the previous month’s 3.2 percent. Inflation for food and nonalcoholic beverages eased to 3.2 percent in November 2017, lower than October’s 3.6 percent. This was the lowest rate recorded since October 2016. Pernia said this can be attributed to lower prices of vegetables, sugar, jam, honey, chocolate and confectionery, fruits, oils and fats, and rice. “We are starting to see year-on-year price declines for ampalaya, cabbage, carrots, tomato, white potato and imported garlic in the National Capital Region [NCR]. This signifies that supply is starting to stabilize again,” he added. PSA data showed inflation in NCR was at 4.9 percent in November 2017. It was the same rate recorded in the previous month while, in November 2016, the rate stood at two percent. Inflation in Areas Outside NCR eased to 2.8 percent in November 2017. Inflation was 3 percent in the previous month and 2.6 percent during the same period a year ago. Excluding select food and energy items, core inflation, however, moved up faster, at 3.3 percent in November 2017. In the previous month, it was registered at 3.2 percent, and in November 2016, 2.4 percent.

‘Squarely within target’

The lower inflation print in November also made the Bangko Sentral ng Pilipinas (BSP) more confident that price increases will remain squarely within its target for the year. After the Philippine Statistics Authority’s announcement of a tamer November inflation on Tuesday, BSP Governor Nestor A. Espenilla Jr. said the development was in line with their latest forecasts for the year. “The easing of inflation in November was expected, following the October peak. We’re still on track with the 3.2-percent inflation for 2017, just about the midpoint of target range,” Espenilla told reporters on Tuesday. Aside from the affirmation of its inflation track, ING Bank Manila economist Joey Cuyegkeng also said the tamer inflation in November gives the BSP more leeway to maintain its current monetary-policy settings. “The moderation argues for the BSP to continue to utilize this leeway of moderate and within-target inflation expectation by keeping policy settings steady at its December 14 policy-rate meeting,” Cuyegkeng said. “We anticipate the first tightening move of the BSP in the second quarter of 2018,” he added. Upside risks to inflation, however, are still in the picture despite the slower price growth in November due largely to higher global crude-oil prices and upon the implementation of the tax-reform measure as targeted in the first quarter of next year. “The likely implementation of the Philippine taxreform measure in the first quarter of 2018 would also exert some upward pressure on inflation. BSP regards the tax-related pressure as transitory,” Cuyegkeng said. “We remain cautious and expect average inflation in 2018 closer to the upper end of the range, at 3.7 percent to 3.8 percent,” he added. The economist’s inflation forecast is higher than the 3.4 percent projected by the BSP for 2018.

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Enough with PUV strikes–Malacañang

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alacañang on Tuesday said it will no longer tolerate transport strikes and vowed to nab organizers of activities that may inconvenience the public. T he Pa l ace statement was issued following the arrest of transport leader George F. San Mateo, head of the Pinagkaisang Samahan ng Tsuper at Operator Nationwide (Piston). Presidential Spokesman Harry L. Roque Jr. said the government will strictly implement Commonwealth Act 146, or the publicservice law, against operators who will organize or take part in strikes. Under the public-service law, it is a act criminal for operators of public services, such as mass transport, to “withhold or refuse any service.” “Hindi naman po talaga pinapayagan iyan sang-ayon sa ating umiiral na batas ngayon. Well, obligasyon po ng gobyerno na talagang ipatupad ang ating mga batas [Transport strikes are really not permitted under our existing laws. It is the duty of the government to implement these laws],” Roque said at a news briefing. Roque issued the warning following the arrest of San Mateo as he was about to post bail for his case before a Quezon City court. San Mateo was charged for leading a nationwide strike in February. Piston is strongly opposing to the government’s plan to phase out old jeepneys and replace these with modernized units, which transportation officials claim to be more efficient and environment-friendly. Piston said drivers and operators cannot afford the modernized jeepneys priced from P1 million to P1.5 million, nor the government’s loan package payable in seven years at 6-percent interest. “I think he [San Mateo] was warned that as a holder of a franchise, a certificate of public convenience, it is criminal and it is illegal for them to participate in any tigil-pasada. As I said, it is also pursuant to a warrant of arrest duly issued by a court and,

ROQUE: “Well, it sends the message that if you violate the law, you will be prosecuted by authorities. That is, after all, the duty of the state. We can’t have it any other way.”

therefore, there can be no harassment here,” Roque said. He also took a swipe at militant group Bagong Alyansang Makabayan for decrying the arrest of San Mateo as “pure harassment and intimidation.” The Palace official made clear the arrest was not politically motivated, but simply justice at work. “Well, it sends the message that if you violate the law, you will be prosecuted by authorities. That is, after all, the duty of the state. We can’t have it any other way. They were warned that, although there is freedom of expression and peaceful assembly, it is limited in the case of holders of certificates of public convenience because the law says so and the law metes the penalty,” he said. Roque said administration critics should make use of legal processes in voicing out their concerns to the government. “Makipag-ugnayan sila sa gobyerno. Makipag-usap sila. Gaya ng ginawa ngayon nila, kinansela nila iyong transport strike at nais nilang magkaroon ng diyalogo sa gobyerno [They sit down with the government. They engage in dialogue. Like what they did recently, they canceled their planned transport strike to talk with the government],” he said. President Duterte in October slammed Piston for rallying people to oppose the jeepney-modernization program and holding a two-day nationwide strike. He said if operators and drivers cannot modernize their units, then “[the] son of a bitch[es], go ahead, suffer in poverty and hunger, I don’t care.” Elijah Felice E. Rosales

Editor: Vittorio V. Vitug • Wednesday, December 6, 2017 A3

Duterte attaches ‘terrorist’ tag to CPP-NPA

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By Elijah Felice E. Rosales

@alyasjah

resident Duterte has placed the Communist Party of the Philippines (CPP) and its armed wing, the New People’s Army (NPA), under the terrorist list of the country.

In an interview with reporters on Tuesday, Presidential Spokesman Harry L. Roque Jr. said the President has signed a proclamation labeling the CPP-NPA as terrorists. The proclamation came after Duterte terminated the peace talks with the communists in November. Although the proclamation is yet to be officially released by Malacañang as of this writing, Roque said the President has instructed the publication of the CPP-NPA, as well as persons and organizations affiliated to them, as terrorists. “In this regard, I hereby direct

to publish the foregoing destination of the CPP-NPA and all other designated persons and organizations in accordance with Sections 3 and 15 of RA [Republic Act ] 10135 and its implementing rules and regulations,” Roque said, quoting the draft proclamation. Under RA 10168, or the Terrorism Financing Prevention and Suppression Act, the financing of terror groups is prohibited and penalized. Section 15 of RA 10168 mandates the Department of Foreign Affairs to publish a list of the designated persons to which the law or the Human Security Act applies.

Executive Secretary Salvador C. Medialdea has also issued a memorandum to Justice Secretary Vitaliano N. Aguirre II to immediately file for the proscription of the CPP-NPA as a terrorist organization in a regional trial court (RTC). “Because of the proclamation, the [justice] secretary was directed by [Medialdea] to file a petition in the RTC because it is not automatic that just because the Executive has classified the group as a terrorist organization, it will be considered as a terrorist organization under

In this regard, I hereby direct to publish the foregoing destination of the CPP-NPA and all other designated persons and organizations in accordance with Sections 3 and 15 of RA [Republic Act] 10135 and its implementing rules and regulations.” —Draft proclamation

Cimatu calls on Asean to build sustainable cities, urban centers By Jonathan L. Mayuga

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Yuletide backyard enterprise

The owner of this backyard lantern-making enterprise supervises the assembly of Christmas lanterns less than three weeks before the Christmas day. Relying mostly on materials indigenous to their place, the Las Piñas star makers have been making brisk business for the past decades. NONIE REYES

Sereno says judicial transparency measures in place under her watch By Joel R. San Juan @jrsanjuan1573

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eleaguered Chief Justice Maria Lourdes A. Sereno on Tuesday said several measures have been put in place to promote transparency in the judicial branch of the government. In a news statement, Sereno said as early as 2012, numerous reforms have been initiated in order to give the public more access to the Judiciary, sans the freedom of information law, which is still pending in Congress. Sereno made the remarks in response to President Duterte’s recent call to the Legislative and judicial branches of the government to strengthen democratic institutions by instituting measures that would allow the public free access to information about their affairs. Sereno said among the measures that the judiciary has implemented toward transparency include the release of summaries of the statement of assets, liabilities and net worth of the justices since 2014 and fiscal and financial data like disbursements from Judiciary Development Fund and Annual Procurement Plans. Also part of the measures, she added, is the audio livestreaming of the oral arguments of the Supreme Court (SC) and posting of relevant pleadings and legal documents on cases of public concerns in its web site. Sereno also mentioned the issuance of updates on relevant and current developments through the SC PIO Twitter page, release of Bar exams results every year since 2013 and approval of new rules and procedures and guidelines to judges.

She added that the SC information office has been conducting news briefing on Tuesdays after each session of the High Court. “The Court is also deliberating on a draft Rule of Access to Information About the Supreme Court pursuant to its power to promulgate rules and I ower to supervise the lower courts,” she said.

No factual basis

the domestic law and under relevant security council resolutions,” Roque said. However, the proclamation has not named the negotiating arm of the CPP-NPA, the National Democratic Front (NDF), as a terror group. Nonetheless, all those who are proven financing the CPP-NPA will face criminal charges in court. Peace talks between the government and the NDF has collapsed due to tensions on the ground resulting from encounters between soldiers and communist rebels.

The camp of Sereno, meanwhile, dismissed an accusation raised in the impeachment complaint filed against her that she was responsible for the delay in the release of survivorship benefits of spouses of deceased justices and judges. Such accusation, according to lawyer Jojo Lacanilao, one of the spokesmen of Sereno, has no factual basis Lawyer Lorenzo Gadon, who filed the impeachment complaint against Sereno, claimed that the Chief Justice sat on the applications for survivorship benefits before her office. “The Chief Justice did not ‘intentionally delay’ action on petitions for retirement and/or survivorship benefits, which applications are in the first place required to be decided by the Supreme Court as a collegial body,” he said in a statement. In fact, Lacanilao said the chief magistrate even took actions to address the concerns of surviving spouses of members of the judiciary. “The Chief Justice is sympathetic with the plight not just of retirees in the Judiciary, but of the people, who long for an expeditious resolution of their cases. To this end, she has even instituted measures to rationalize and expedite the very process respecting

The Chief Justice did not ‘intentionally delay’ action on petitions for retirement and/ or survivorship benefits, which applications are in the first place required to be decided by the Supreme Court as a collegial body.” —Lacanilao

retirement benefits that complainant assails,” the lawyer said. He added that Sereno was not the one who created the technical working group (TWG) to review applications for survivorship benefits, contrary to the testimony of Court Administrator Jose Midas Marquez during the hearing of the House Justice Committee on Tuesday. He explained that the TWG was created upon request of the SC's special committee on retirement and civil-service benefits through Memorandum Order 43-2015 dated November 16, 2015, approved by Sereno and the chairmen of the two other

divisions of the SC, Senior Associate Justice Antonio Carpio and Associate Justice Presbitero Velasco Jr. “Sereno merely implemented the terms of the memorandum creating the special committee since it is empowered to recommend the creation of subcommittees to discharge its functions,” Lacanilao pointed out. Under the said memorandum, the special committee has the power to propose policy guidelines and other relevant recommendations to the Office of the Chief Justice to streamline and expedite the financial approval process relative to requests for retirement and civil-service benefits. Lacanilao claimed that TWG was tasked to “screen applications for retirement benefits and/or similar or related benefits for the purpose of determining whether said applications require further study by the committee and to study in more detail the legal concerns related to the grant of retirement benefits.” Meanwhile, two spokesmen Sereno has asked the House Committee on Justice to recall the show-cause order issued against them over their public statements viewed as critical of the committee hearing the impeachment complaint. The said House committee issued show-cause order against lawyers Aldwin Salumbides and Joshua Santiago for their statement at a news conference in Quezon City on November 25, describing the ongoing impeachment proceeding as a “dog and pony show.” Santiago said that he “sincerely meant no ill-will” and “neither slur nor smear was intended” when he made such statement. With Jovee Marie N. dela Cruz

@jonlmayuga

NVIRONMENT Secretary Roy A. Cimatu urged membercountries of the Association of Southeast Asian Nations to build sustainable cities and urban centers in the face of climate change’s worst impacts. Cimatu said sustainable cities and urban centers could play a vital role in times of disaster. In the secretary’s message read on his behalf by Environment Undersecretary for Policy, Planning and International Affairs Jonas R. Leones during a forum on urban resilience to climate change and disaster risk management strategies in Laoag City on Tuesday, Cimatu said achieving sustainable urbanization will be key to adapting to and mitigating the impacts of climate change. “Recognizing the critical role that our cities play as the centers of innovation, we need to harness potentials for innovations in ways that will enable us to build our capacity to withstand shocks while sustaining the services that urban ecosystems provide us—more so in the face of uncertainties,” Cimatu said, quoting world-renowned urban ecologist Dr. Henrik Ernstson. Research and development experts gather in Laoag City on December 5 to 7 for the regional forum to discuss plans on attaining urban resilience to climate change and disaster risks in Southeast Asia. The forum was part of the events celebrating the 50th founding anniversary of the Asean, which is being hosted by the Philippines. ​ In the last decade, Cimatu said Asean countries became highly vulnerable to the effects of climate change, as they are now experiencing more frequent extreme weather events— floods, droughts, heat waves and rising sea levels. As early as 2009, the World Bank warned that the Philippines topped the list of countries most vulnerable to storms, with Vietnam the second most vulnerable to rising sea levels, and Thailand and Vietnam among those most threatened by flooding. Last year the Global Climate Risk Index of GermanWatch listed four out of 10 Asean countries—Myanmar, the Philippines, Vietnam and Thailand—as among the 10 nations most affected by climate change from 1995 to 2014, based on annual averages. Cimatu said other Asean countries are also vulnerable to climate change at varying degrees, with Brunei Darussalam suffering from heat-related stress, low coastal slopes in Indonesia likely to be affected by a small increase in sea level and Malaysia’s Sabah frequently experiencing floods and drought. Climate-induced natural disasters recently experienced by Asean countries, such as the 2013 Supertyphoon Yolanda (international code name Haiyan) underscores the need for proactive policy and action for urban resilience. Pursuing urban resiliency, hence, has become an urgent agenda for all nations as the world’s urban population is expected to balloon to 2.5 billion by 2050, the environment secretary said. “Urban areas, where half of our population lives, drive global warming and consequently climate change,” he said. “The effects of our decisions and actions as part of an urban ecosystem transcend the boundaries of space, politics, ideology, economics and even social strata,” Cimatu added. The three-day regional forum, organized by the Ecosystems Research and Development Bureau of the Department of Environment and Natural Resources, serves as an important venue for discussing plans for attaining, building and reinforcing urban resiliency. The environment chief also urged various stakeholders, from the scientific community and urban planners to manufacturers and consumers, to enhance their participation toward solutions so that Asean policy and decision-makers and resource managers can work together to achieve sustainable urbanization in the region.

Economy

A4 Wednesday, December 6, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

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Govt told to demand refund for ‘risky’ dengue vaccine By Butch Fernandez @butchfBM & Claudeth Mocon-Ciriaco

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Correspondent

he Duterte administration is duty bound to comply with the procurement law compelling the government to “demand refund for the P3.5 billion in taxpayer’s money” paid to the French manufacturer Sanofi Pharmaceutical, which supplied the “ineffective” Dengvaxia dengue vaccines, Senate President Pro Tempore Ralph G. Recto said on Tuesday.

Recto asserted that, under Republic Act (RA) 9184, Sanofi is likewise dutybound to reimburse the government because all government purchases are mandatorily covered by warranty.

Pointing out RA 9184’s “antilemon provision,” the Senate leader said this is discussed extensively in Section 62 of the law, which deals with “Faulty, defective, substandard goods and services. The bot-

tom line is that the government is entitled to restitution.” Recto added: “In fact, RA 9184 requires the supplier to post [a] ‘retention money,’ which the government shall hold on to until the warranty has lapsed, to ensure that goods supplied are free from defects.” Affirming that this is a standard clause in government contracts, the senator said, “Someone is sleeping on the job if the clause was not included in the dengue-vaccine contract.” For instance, he notes that, in the case of public works, defects on road projects that manifest within a given period from date of delivery shall be repaired or replaced “at the cost of the contractor.” “If you buy a defective item and no replacement can be found, then the government can demand reimbursement,” the lawmaker added. Recto warned that, should Sanofi Pharmaceutical ignore the government’s demand for refund, Section 65 of the procurement law provides that Sanofi’s properties “shall be subject to attachment or garnishment proceedings to recover the costs.”

The Senate leader added Sanofi cannot invoke the so-called “no return, no exchange policy” in this case, saying this does not apply to government purchases. He said that, under RA 9184, which the civil service uses as the bible for procurement, even official supplies, car parts and appliances bought for the government must pass the quality test. “ M a ny c or p or at io n s h av e been paying huge fines upon orders of regulatory bodies, a path Sanofi should follow if it wants to retain public goodwill,” the lawmaker suggested. Moreover, Recto noted, as an example, that “Uber, Metrobank, RCBC and PAL, are some of the companies that have willingly paid a fine, or settled obligations, for operational oversights committed,” he said.

Freeze

TO protect the general public, the Food and Drug Administration (FDA) on Tuesday ordered the suspension of the sale, distribution and marketing of Dengvaxia vaccine

and the withdrawal of the product in the market. In its FDA Advisory 2017-318 dated December 4 Nela Charade G. Puno, director general of the FDA, said Sanofi Pasteur’s Dengvaxia “ poses potential risk to those who have never had dengue but were vaccinated.” It also directed Sanofi to conduct an information-dissemination campaign with advisories, Dear Doctor letters and forums with patients. Puno added the FDA is also closely coordinating with the Department of Health (DOH) to monitor any adverse reactions to those who were vaccinated as initial part of the P3.5billion dengue-vaccination program of the department. The public and health-care professionals are also asked to report immediately to the FDA any incident “that reasonably indicates that Dengvaxia has caused or contributed to the death, serious illness or serious injury to a consumer, a patient or any person.” Sanofi Pasteur officials, for their part, maintained that the dengue vaccine has been clearly proven to be

safe and effective in the prevention of dengue in people 9 years of age and older living in endemic settings. “Phase III clinical studies conducted in over 30,000 study participants from 10 countries in Latin America and Asia show a pooled efficacy of 65.6 percent against all four serotypes of dengue; 80-percent efficacy against hospitalizations due to dengue and 93-percent efficacy against severe disease in the study population 9 years of age and older over the 25month follow-up period of the study program,” Sanofi said in a news statement released to the media. The dengue-vaccination program began during the term of thenHealth Secretary Janette Garin in April 2016. DOH said more than 733,000 children—aged 9 and above—from public schools in Metro Manila, Central Luzon and Calabarzon have already received at least the first three doses of the vaccine. The DOH already put on hold the government’s dengue-vaccination program after Sanofi raised health concerns on the vaccine.

DPWH partners with Uber for seamless travel in Metro manila T

he riding public can now have a seamless and efficient carpool experience as Uber joins forces with the Department of Public Works and Highways (DPWH).

Public Works Secretary Mark A. Villar sealed on Tuesday the agreement with Uber Country Manager Laurence Cua through a memorandum of understanding signing event

at the Operations Room of the DPWH Building. Villar acknowledged the importance of the Uber app in the promotion of ridesharing and carpooling,

which can aid in traffic decongestion along the major thoroughfares in Metro Manila. “This is one major step toward finding a solution to the increasing vehicle volume in our roads. With the help of Uber, we will be able to have better decision-making process when it comes to traffic patterns, solutions and rerouting schemes,”

Villar said. The riding app will build the Movement for Manila platform, with the help of the DPWH Planning Department, to provide inputs for enhanced traffic management and troubleshooting. “O u r de p a r t me nt i s one with Uber in their campaign toward finding a solution to our current traf-

fic condition. We will provide them with inputs and relevant updates to ensure a hassle-free journey for their growing ridership,” Villar added. Cua expressed his full support for the upcoming endeavor with the department, assuring Uber will provide reliable data about traffic patterns and the use of the city infrastructure as collected by the Uber application.

Lawmaker pushes GSIS loan-interest condonation for public-school teachers By Jovee Marie N. dela Cruz @joveemarie

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lawmaker has recently filed a resolution urging the GovernmentService InsuranceSystem (GSIS) to immediately waive incurred penalties of public-school teachers in the payment of their loans. In House Resolution 1508, Partylist Rep. Ron P. Salo of Kabayan said around 23,000 teacher-retirees this year failed to receive their pension due to unpaid debts. “Waiver of penalties incurred by public-school teachers in the payment of their loans in GSIS will, in effect, provide immediate relief to all those affected by the vicious debt cycle that continues to plague public-school teachers and their families,” he said. Salo added Department of Education (DepEd) Order 38, issued on July 31, 2017, allowed GSIS and Home Development Mutual Fund (Pag-IBIG) loans to be deducted from teachers’ salaries without a cap, leading some

to have a meager take-home pay below P4,000. Citing DepEd data, Salo said the current total debt of public-school teachers from legitimate private lending institutions have ballooned to P178 billion, aside from the already existing P123 billion worth of loans owned to the GSIS. This amounts to P301 billion worth of loans, equivalent to 55 percent of the 2018 DepEd proposed budget of P549 billion. “However, the DepEd order was questioned, and this led to the issuance of DepEd Order 55 [dated October 26, 2017]. The new DepEd order will prioritize deductions from the GSIS and Pag-IBIG Fund loans without affecting teachers’ mandated net take-home pay,” Salo said. With accrued penalties of their loans from the GSIS and an imposed deduction cap, teachers will have to pay their loans and penalties in a longer period. DepEd Order 55 implements the minimum take-home pay of P4,000, consistent with Section

47 of the General Appropriations Act of 2017. According to Salo, the current gross salary of public-school teachers is around P19,000, but they take home far less than the gross amount due to unfortunate and unforeseen financial troubles. The lawmaker, meanwhile, urged the GSIS to implement debt forgiveness or condonation for newly retired and retiring public-school teachers from 2017 to 2022, including teachers who are deceased before their scheduled retirement, so that these teachers and their families will benefit from the value of the retiring teachers’ maturing GSIS policy. He also called for the conduct by the DepEd, finance department and government financial institutions of “nationwide financial literacy and enabling training to empower public-school teachers to manage their personal finances better and get them out of the path to financial ruin.”

Agriculture/Commodities BusinessMirror

www.businessmirror.com.ph

Editor: Jennifer A. Ng • Wednesday, December 6, 2017

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Farm-gate price of rice up nearly 7%

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he average farm-gate price of paddy in the fourth week of November rose by nearly 7 percent to P18.6 per kilogram (kg), from last year’s P17.38 per kg, according to the Philippine Statistics Authority (PSA).

T he l atest d at a f rom t he PSA also showed the farm-gate price of paddy during the period was slightly higher than t he prev ious week ’s level of P18.56 per kg. “The average wholesale price of well-milled rice at P39.20 per kg exhibited a price decrease of 0.03 percent from a week-ago quotation. However, it was higher by 3.09 percent compared to the same week in the previous year,” the PSA said in a statement. Data from the PSA showed that the average retail price of

well-milled rice dropped by 0.03 percent, from the previous week’s level of P42.19 per kg. On an annual basis, the price rose by nearly 2 percent. As for regular milled rice, the PSA noted that its average wholesale price was higher by 4.03 percent on an annual basis. Compared to its price a week ago, the PSA said it remained at P35.71 per kg. “ This week ’s average retail price of regular milled rice at P38.01 per kg fell by 0.07 percent, from a week-ago level of P38.04 per kg. On an annual

Bloomberg

basis, it gained by 2.56 percent,” the PSA said. On a yearly basis, the average farm-gate price of yellow

corn rose by 12.43 percent to P12.22 per k g , accord i ng to data from the PSA. Compared to its previous week’s level, the

average far m-gate pr ice rose by 1.51 percent. “The average farm-gate price of white corn at P16.58 per kg

climbed by 1.49 percent, from P16.34 per kg in the previous week. Relative to a year-ago quotation of P10.84 per kg, it likewise rose by 52.92 percent,” the PSA said. Data from the PSA showed that the average wholesale price of yellow corn during the week was pegged at P18.67 per kg, nearly 10 percent higher than t he pre v iou s ye a r ’s le ve l of P17.02 per kg. “A price cut of 0.03 percent was recorded for the average retail price of yellow corn at P22.44 per kg during the week. It also went down by 1.07 percent compared to a year-ago quotation of P22.69 per kg,” the PSA said. As for white corn, the PSA noted that the average wholesale price rose by 34.3 percent to P20.85 per kg, from the previous year’s quotation of P15.53 per kg. “The average retail price of white corn grain remained at P30.26 per kg for four consecutive weeks. Ho w e v e r, it re g i s t e re d a 16.68-percent hike from its previous year’s level,” the PSA said.

DPWH to buy more coconut Jollibee, Cargill inaugurate largest products from Aklan farmers poultry-processing plant in PHL C By Jun N. Aguirre Correspondent

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ALIBO, Aklan—Farmers in the province are gearing up to meet the demand of buyers, such as the Department of Public Works and Highways (DPWH), for more coconut products next year. During a Business Opportunities in the Coconut Industry forum held on November 28 here, farmers were told by the Department of Trade and Industry (DTI) that there is a huge demand for their coconut products. D T I - A k l a n c h ie f C a r me n

Iturralde said the agency has received “lots of offers” from local and foreign buyers, including the DPWH. “We have received offers from here and abroad, and they want to find out if the province could supply more coconut products,” Iturralde said. Plevy Raco, Philippine Coconut Authority manager, said coconut farmers in the province were adversely affected by Supertyphoon Yolanda in 2013. “Currently, coconut farmers are recovering. We are planning to provide more coconut trees to be planted by our farmers around

the province,” Raco said. Leo Bionat, assistant district engineer of the DPWH said their department will need more coco geonet for various road projects. Bionat said DPWH-Aklan will construct millions of pesos worth of farm-to-market roads next year. Reynaldo Vallegio, a village chairman of Barangay Aparicio, Ibajay, and a coconut farmer, said he is optimistic about the prospects of the coconut industry in the province. “I am now modestly ear ning from the coconut industry, and, with what I had learned, I know I could earn more in 2018,” he added.

argill Joy Poultry Meats Production Inc. (C-Joy), a joint venture between Cargill and Jollibee Foods Corp. (JFC), inaugurated its new poultry-processing plant in Santo Tomas, Batangas, on Tuesday. With a processing capacity of 45 million chickens per year, C-Joy said in a statement that the plant is the largest in the Philippines and provides dressed and marinated chicken to meet the increased demand at JFC brands in the country. “We are bringing protein to families’ tables across the Philippines. Cargill and Jollibee came together to start this plant because of our common commitment to the highest standards in product quality and

food safety,” said C-Joy President and CEO Paul Fullbright. C-Joy is partnering with local poultry farmers in Batangas and nearby provinces to supply chickens to the new facility. “We are looking forward to producing the chickens that will be supplied to the C-Joy plant to meet the poultry-meat requirements of Jollibee,” said Vic Lao, president of Highcrest Corp, a partner grower of C-Joy. The inauguration of the plant was witnessed by Rep. Ma Theresa Collantes of the Third District of Batangas, Santo Tomas Mayor Edna Sanchez and United States Ambassador to the Philippines Sung Kim. “We hope that this plant will

eventually provide and augment work and business opportunities to poultry growers, allied services and qualified Tomasinos alike,” Sanchez said. Kim said the investment from Cargill is “an example of the strong economic relationship between the Philippines and the US.” The Philippines was the first country where Cargill established its presence in Asia back in 1948. “We are proud that US companies like Cargill make investments that strengthen the economic partnership between our two countries and contribute to the economic development of the Philippines by providing livelihood opportunities, particularly in rural areas,” he said.

Empowering women improves communities, ensures success for generations

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OME—At an event held on October 29 at the International Fund for Agricultural Development (Ifad) Gender Awards 2017, five countries were honored for impressive achievements in gender equality and women’s empowerment despite harsh conditions and numerous daunting situational and societal obstacles. The five countries are Bangladesh, Mozambique, Colombia, Morocco and Mauritania. The Ifad-supported projects in these countries have ambitious goals for a more egalitarian future. To date, these projects have successfully provided women with decision-making opportunities, skill training and increased autonomy through the development of their own livelihoods. Morocco’s Country Programme Manager, Naoufel Telahigue, summed up the greatest overall effect best: “Rural women have become a symbol of will.” With empowerment comes greater individual and collective confidence, influence and overall happiness, which contributes to the vitality of households and communities. There is still much to be achieved, however, these projects have yielded numerous positive results worthy of the utmost praise. Mozambique’s Rural Markets Promotion Programme (Promer) empowered women to join farmer organizations where they now have equal membership as men. Women have increased their revenue by connecting to markets, and even becoming community leaders. Throughout homes in Mozambique, women and men are rewriting embedded household gender roles through the Gender Action Learning System. Men are not only warming up to the idea of sharing women’s domestic workloads, they are also seeing the benefits, Mario Quissico, Gender focal point, Promer,

FAD

explained. “It is very exciting hearing men say, we are happy because harmony at home has increased. We are working as a family, we are contributing to activities that we thought were for women.” Vital to women’s security in Bangladesh, especially after the recent resettlement on the coastal islands, is the Char Development and Settlement Project’s initiative for women and men to own equal amounts of land. The Deputy Team Leader of the project, Md. Bazlul Karim, clarified that even

women without husbands are protected. “50 percent goes to the woman, and 50 percent to the man. If there is a single woman who is the head of a family, she will get 100 percent of the land.” In Colombia Building Rural Entrepreneurial Capacities Programme: Trust and Opportunity believes that empowering women is absolutely essential to the country’s peace. They are helping poor, vulnerable women who are heads of households by providing training and incentives to

create their own incomes. Some have even embraced the male-typical endeavor of raising livestock. Morocco’s Agricultural Value Chain Development Project in Mountain Zones of AL-Haouz Province have encouraged women to get training in businesses with local products like wool, olives and apples. Coined the “two-sheep initiative,” women have started their own businesses by acquiring two sheep. There is also a focus on female-run small businesses in Mauritania where the Poverty Reduction Project in Aftout South and Karakoro supports women’s micro projects. Easier access to drinking water has also been a vital part in improving the lives of women and reducing poverty. With fresh water closer, women save as many as five hours each day, which they can instead use to earn money. All of these projects are combating gender inequality and have given women the ability to make decisions and take positions of power in families and communities. These advancements positively influence entire societies. The Coordinator of Mauritani’s project, Ahmed Ould Amar, emphasized, “We are reaching 281 villages and working with 19,000 households. This is quite huge so, obviously, when you are working at this type of scale you have economic, social and organizational impacts on society.” Not only have these projects been working tirelessly from the ground up and, in turn, improving gender equality in society, they are securing it for future generations. Young people in Colombia are being protected by the project’s encouragement of entrepreneurial women to work with young people and include them in their empowerment.

According to Ahmed Ould Amar, young women are being heard in Mauritania, “We’ve got this diagnosis process at field level that always includes a group of young people and women, so we can hear what their problems are.” A school, which also ingeniously acts as a shelter from cyclones, has been created in Bangladesh, and many young girls are being educated for the first time. In Mozambique women who were previously illiterate are being taught how to read. They can perform previously impossible tasks, such as understanding forms at the hospital so they can help their children flourish. Inter Press Service

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Wednesday, December 6, 2017

briefs U.N. political chief heads to N. Korea on rare visit

UNITED NATIONS—The UN political chief is heading to North Korea on a rare four-day visit at the invitation of the government for a wide-ranging discussion on policy issues “of mutual interest and concern.” UN Spokesman Stephane Dujarric said UndersecretaryGeneral for Political Affairs Jeffrey Feltman would arrive in Pyongyang on Tuesday from Beijing, where he met with Chinese Vice Foreign Minister Li Baodong on Monday. Asked whether Feltman would meet with North Korean leader Kim Jong Un, Dujarric said that his current schedule included meetings with Foreign Minister Ri Yong Ho, Vice Minister Pak Myong Guk, diplomats and UN staff. AP

UAE, Saudi forming new group, separate from GCC

KUWAIT CITY—The United Arab Emirates (UAE) on Tuesday announced it has formed a new economic and partnership group with Saudi Arabia, separate from the Gulf Cooperation Council (GCC)—a move that could undermine the council amid a diplomatic crisis with memberstate Qatar. The Emirati Foreign Ministry announcement, just hours ahead of a GCC meeting in Kuwait, said the new “joint cooperation committee” was approved by the UAE’s ruler and president, Sheikh Khalifa bin Zayed Al Nayhan. Saudi Arabia did not immediately report on the new partnership. It wasn’t immediately clear how the development could affect the six-member GCC meeting, which is expected to focus on the Qatar issue. Half of the GCC members are boycotting Doha in a dispute that’s cleaved the Arabian Peninsula. AP

His job security questioned, Tillerson tours Europe anyway

BRUSSELS—What do you do when you’re America’s top diplomat, fourth in line to the presidency, and the White House makes it publicly known you’re living on borrowed time? If you’re Secretary of State Rex Tillerson, you brush it off, pack a suitcase and hop a flight to Europe, as if nothing had happened. Tillerson tours Europe this week under circumstances unparalleled in recent United States diplomatic memory. After months of public tensions with President Donald J. Trump and rumors about Tillerson’s future, the White House signaled last week he could be fired—and possibly soon. White House officials told multiple news organizations a plan was afoot to oust Tillerson and replace him with CIA Director Mike Pompeo, a close Trump confidant. “It’s laughable,” Tillerson quipped the next day, as aides insisted he was staying in his job. “FAKE NEWS,” tweeted the president, saying Tillerson was “not leaving.” AP

French president warns Trump over possible IsraeL embassy move

French President Emmanuel Macron told President Donald J. Trump that he’s concerned about the possibility that the United States might unilaterally recognize Jerusalem as the capital of Israel, ahead of a decision expected this week. In a phone call on Monday, Macron “reaffirmed that the status of Jerusalem must be resolved through peace negotiations between Israelis and Palestinians,” France’s embassy to the US said in a statement. The message from France was only the latest expression of concern ahead of a deadline for Trump to either announce the US embassy will move to Jerusalem from Tel Aviv or delay a decision for another six months, as required by a 1995 law. Every US president since Bill Clinton has waived that requirement. Last Sunday, White House National Security Adviser H.R. McMaster told Fox News Sunday he didn’t know whether Trump would move the embassy. Bloomberg News

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Trudeau’s Beijing scramble is Canada’s latest trade stumble

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onday could have been a turning point in ChinaCanada relations. Instead, it was a false start. Prime Minister Justin Trudeau’s latest trip to China was preceded by a slew of signals the countries would launch free-trade talks. Canadian lawmakers said flatly that was the goal; exploratory talks had just wrapped; Canada released a public consultation teeing things up; and Trudeau’s trade chief, Francois-Philippe Champagne, spoke about the allure of the Chinese market—while also warning no decision had been made. Then came Monday, the first day of Trudeau’s state visit. A scheduled news conference with Premier Li Keqiang was scrapped as China and Canada bickered over the format of the event. Chinese officials blocked Canadian media. When Li and Trudeau finally emerged, they gave statements, announced smaller agreements and didn’t launch talks. It’s a setback for Trudeau as he advances a “progressive” trade agenda that emphasizes matters like the environment, labor and gender as an antidote to populist backlash. He is finding it’s a tough sell, as China tends to prefer pared-down trade deals that skirt such issues. Canada angered Japan last month by balking at a deal to salvage the Trans Pacific Partnership (TPP), and is pressing to add similar elements to the North American Free Trade Agreement (Nafta), which United States President Donald J. Trump has threatened to quit. This time around, it’s unclear which nation balked. Trudeau said neither wanted to launch anything they couldn’t finish. Canada will only proceed in talks if it has “confidence that what we start, we’re going to be able to complete,” Trudeau told reporters

late on Monday in a Beijing hotel, after his meeting with Li. He said Canada was “committed” to its progressive trade agenda, and that China considered the issue a precedent case, whi le dow npl ay ing what t he sticking point was. “There wasn’t one specific issue.” The two countries had been in talks through Monday on whether to launch full negotiations but didn’t reach an agreement, a Canadian government official said, speaking on condition of they not be identified. Talks are ongoing and full negotiations could still be launched before Trudeau’s trip concludes on Thursday, the official said. Trudeau’s team “is trying to thread the communications needle on trade for domestic audiences and is confusing our trading partners,” Mark Warner, a Toronto-based trade lawyer with Maaw Law, said by e-mail.

‘The objective’

Canadian officials had hedged their bets in the days before Trudeau’s departure. Champagne said they had “yet to make a decision,” though Innovation Minister Navdeep Bains told Global TV last Sunday that launching formal talks was “the objective.” Both ministers are accompanying Trudeau to China. “Should we enter into negotiations with China, the government will secure a deal in the best interest of Canadians,” Champagne said

Canadian Prime Minister Justin Trudeau (Center) and Chinese Premier Li Keqiang (fourth from left) speak during a signing ceremony at the Great Hall of the People in Beijing on Monday. Fred Dufour/Pool Photo via AP

on Monday in a written statement released by his spokesman. Plans changed several times on Monday at the Great Hall of the People. Chinese officials tried to block access by Canadian journalists, who were initially told the leaders would take questions before Trudeau’s aides told them that would no longer be the case as the countries haggled over the format. The two leaders eventually emerged and spoke. They agreed on the need to “uphold global trade liberalization” and would continue exploratory talks and “feasibility studies” on a full free-trade agreement (FTA), Li said. “China is open to such talks,” he said, adding: “It is only natural that we don’t see eye-to-eye on some issues.”

I think this was a loss of face for the Chinese premier.” —Mulroney

Dav id Mu lroney, a for mer Canadian ambassador to China, said the Chinese were probably very surprised. “I think this was a loss of face for the Chinese premier,” he said in an interview with the Canadian Broadcasting Corp. aired on Monday. “It is surprising that we got this far and came out with so little,” Mulroney said. “As long as the prime minister’s in Beijing, there’s a chance a rabbit could be pulled out of the hat, although I think it’s unlikely.”

What now?

It was a puzzling development for Trudeau, who is the first Canadian prime minister to visit China in back-to-back years. A separate government official, speaking on condition of anonymity, said it wasn’t Canada’s demands for “progressive” elements that were holding up FTA talks. Instead, the countries wanted to be sure they could finish any talks that they started, the official said.

T he pat h for ward is unc lear. C ha mpag ne has sa id a ny t rade dea l w it h C h i n a , shou ld t a l k s be l au nc hed , w i l l t a ke t i me t o comple t e. Meanwhile, another trade deal meant in part to challenge China’s clout—the TPP, whose recent rebrand as the “Comprehensive and Prog ressive” T PP h a s C a n ad i a n fingerprints on it—remains in negotiation. “More work needs to be done on some outstanding issues,” Champagne said in his written statement. Wa r ner, t he t rade l aw yer, fears the fallout from Monday. “ T he government is going to have to decide whether they want to start with China and finish with Japan on the basis of what is doable now, or whether they want to hold out for more while stalling for time on Nafta,” he said. “ They are going to have to be clearer to trading partners or this is going to keep happening, and each time that it does they will lose some credibility.” Bloomberg News

Trump’s tweet raises obstruction specter, worries allies

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A S H I N G T O N —T h e shifting explanations for why President Donald J. Trump fired National Security Adviser Michael Flynn have revived questions about whether the president may have obstructed an ongoing investigation of potential contacts between his campaign and Russia. Pressure on the administration has mounted since Flynn last week pleaded guilty to lying to the Federal Bureau of Investigation (FBI) about his conversations with the Russian ambassador, with prosecutors revealing that he is now cooperating with special counsel Robert Mueller’s investigation. And a muddled White House response, including a problematic presidential tweet, has left some Trump confidants worried that the president is not being well-served by his legal team and believing his lawyers have painted a too-rosy picture of the president’s potential plight. The president’s aides and legal advisers have scrambled for 48 hours to explain a presidential tweet that raised the specter of obstruction. It read: “I had to fire General Flynn because he lied to the vice president and the FBI. He has pleaded guilty to those lies. It is a shame because his actions during the transition were lawful. There was nothing to hide!”

That tweet appeared to indicate a change in the White House explanation for Flynn’s firing, suggesting Trump was aware when the White House dismissed Flynn on February 13 that the national security adviser had lied to the FBI, whose agents had interviewed him weeks earlier. Former FBI Director James Comey has said Trump the following day brought up the Flynn investigation in private at the White House and told him he hoped he could “let this go,” raising the possibility he knew Flynn had lied and was looking to cover up the offense. With questions raised by the tweet, Trump associates tried to put d istance bet ween the president and the potentially incriminating message. One of Trump’s lawyers, John Dowd, told CNN last Sunday that he was responsible for crafting the tweet. Dowd declined to comment to the AP but replied with a Fox News story on Monday, quoting prominent lawyer Alan Dershowitz as saying Trump couldn’t have committed obstruction of justice by urging Comey to drop the FBI investigation of Flynn. Kellyanne Conway, counselor to the president, backed up Dowd’s claim that he wrote the tweet, saying “the lawyers are the ones that understand how to put those

tweets together.” “I was with the president on Saturday all day, frankly, and I know that what he said is correct,” Conway continued, referring to Dowd. “What he says is that, he put it together and sent it to our director of social media.” A White House spokesman declined to answer whether Dowd dictated the t weet word-forword to the W hite House director of social media, Dan Scavino, or whether Scavino, who has access to the @RealDonaldTrump account and its 44 million followers, put the sentiment into something resembling Trump’s own voice. The president angrily scolded aides for the tweet over the weekend, according to a person familiar with private conversations but not authorized to discuss them publicly. The White House is considering reviewing how some tweets, particularly related to the Russia probe, get posted. The episode has rattled some of Trump’s outside advisers, who have pressed upon Trump since Flynn’s guilty plea that he needs to change legal strategy. White House lawyer Ty Cobb has repeatedly offered public assurances that the investigation into the administration would soon be over, with the president exonerated.

Trump has taken that counsel to heart, telling two close allies over the weekend that he believed he was in the clear and that Mueller’s team wouldn’t unveil any further charges, according to the advisers who discussed the private conversations under the conditions of anonymity. Both of the confidants said they disputed that assessment and urged Trump to go on the offensive, perhaps by firing his current lawyers or triggering a series of events that could lead to Mueller’s dismissal. Trump did not suggest he was considering that approach. And one of the advisers, who speaks to Trump regularly, said the president had not discussed with him the possibility of issuing any pardons. The president did lob new criticism at the special counsel investigation on Monday, saying he feels “very badly” for Flynn. “I think it’s a shame,” Trump said of Flynn’s situation, adding that it’s “very unfair” and that Flynn had “led a very strong life.” In the wake of the controversial tweet, Trump launched a fresh denial that he had pressured the former FBI director, tweeting last Sunday that “I never asked Comey to stop investigating Flynn. Just more Fake News covering another Comey lie!”

Trump fired Comey in May, leading to Mueller’s appointment. Any proof that Trump knew before he spoke with Comey in February that Flynn had lied to the FBI could bolster obstruction of justice allegations against the president and raise the prospect that he was trying to protect a key member of his inner circle from probable prosecution, said Jimmy Gurule, a Notre Dame criminal law professor and former federal prosecutor. Though the president has previously said he was thinking of “this Russia thing” when he fired Comey, Gurule said it was reasonable to infer from the weekend tweet that the dismissal of Comey was done in the hope of terminating the FBI investigation. “If you have knowledge of a crime, a reasonable person would disclose that information to law enforcement. The president did not,” Gurule said. But David Rivkin Jr., a Washington law yer specializing in constitutional law who worked in the Justice Department under presidents Ronald Reagan and George H.W. Bush, said that even if the president knew that Flynn had lied to the FBI, “his authority as the chief executive is perfectly sufficient and appropriate to decide that this matter should not be investigated any further.” AP

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Wednesday, December 6, 2017

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Future of Irish border remains an obstacle in Brexit talks

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RUSSELS—The European Union (EU) and Britain ended a flurry of top-level diplomacy on Monday without a deal on the terms of their divorce, as agreement on how to maintain an open Irish border after Brexit slipped out of the negotiators’ grasp. But the two sides said they were within striking distance of consensus, setting up a hectic negotiating rush ahead of an EU summit next week. Member-countries must decide whether to broaden the talks to the topic of future relations. British Prime Minister Theresa May went to Brussels for a long negotiating lunch with EU Commission President Jean-Claude Juncker. After a day that see-sawed between hope and disappointment, the leaders failed to make what the European Union considers “sufficient progress” on three issues: Britain’s exit bill, the rights of citizens affected by Brexit and the status of the currently invisible Irish border. The border issue remained the main sticking point. “We had an agreement this morning,” Irish Prime Minister Leo Varadkar said, expressing d i s appoi nt ment at t he l a st minute glitch. EU leaders want a deal on the breakup terms in time for them to agree at the December 14 and 15 summit whether to move the negotiations on to the next stage of talks, including trade. The lack of progress so far has raised concerns that Britain may not have a deal by the time it officially leaves on March 29, 2019. “Despite our best efforts and the significant process we and our teams have made over the past days on the remaining withdrawal issues, it was not possible to reach an agreement,” Juncker said. “This is not a failure,” Juncker added after a long negotiating lunch with May. May said that, “on a couple of issues, some differences do remain, which require further negotiation and consultation.” But she said talks would reconvene later this week, “and I am also confident we will conclude this positively.” The EU and the United Kingdom are nearing agreement on some divorce terms, including the size of the bill that Britain must pay as it leaves and the rights of citizens affected by Brexit. But the border issue has proved more intractable. After Britain leaves the bloc, the currently invisible 310-mile (500-kilometer) frontier will be the UK’s only land border with an European Union country.

Britain says it wants to maintain a “frictionless” flow of people and goods with no border posts. But Ireland and the other EU nations are demanding to know how that will work if Britain is outside the European Union’s borderless single market and its tariff-free customs union, a looser trading bloc that includes non-EU states like Turkey. Negotiators were discussing an agreement that would commit Britain to maintaining “regulatory alignment” between Northern Ireland and Ireland after Brexit. Both sides would promise to maintain compatible trading rules, keeping the border transparent for trade. Irish and EU officials indicated that agreement was close. But then Northern Ireland’s Democratic Unionist Party (DUP), which props up May’s minority government, announced it wouldn’t support any deal that made special rules for Northern Ireland. The pro-British Unionist party opposes any special status that could take Northern Ireland further from Britain and closer to the Republic of Ireland. The DUP has only 10 seats out of 650 in Britain’s House of Commons but, without their support, May’s government would fall. “We will not accept any form of regulatory divergence that separates Northern Ireland economically or politically from the rest of the UK,” DUP leader Arlene Foster said. “The economic and constitutional integrity of the UK must not be compromised in any way.” Varadkar said he was “surprised and disappointed that the British government now appears not to be in a position to conclude what was agreed earlier today.” “I still hope this matter can be concluded in the coming days,” he added. Chief European Parliament Brexit official Guy Verhofstadt, who had put the odds of agreement on Monday at “50/50,” warned that, unless all issues are solved, “there will be no green light in October 2018.” A decision on any new deals with Britain would have to be reached by the fall of next year to give individual member-states enough time to approve all the measures in their parliaments before the final date on March 2019. European Council President Donald Tusk cautioned that time was running short. “It is now getting very tight but agreement at December [summit] is still possible,” he tweeted. Bloomberg News

EU to consider including 11 countries in tax blacklist

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p to 11 countries could end up on a European Union (EU) blacklist of tax havens and potentially face sanctions for failing to bring their tax standards in line with the bloc, according to the latest draft of proposals. The group of jurisdictions, outlined in a document obtained by Bloomberg, is set to be rubber-stamped by EU finance ministers at a meeting in Brussels on Tuesday. It includes South Korea, Panama, Tunisia and the United Arab Emirates, as well as Barbados, Cabo Verde, Grenada, Macao, the Marshall Islands, Palau and Saint Lucia. The final list is the result of months of screening on dozens of countries and territories, and back-and-forths between the 28-country bloc and various jurisdictions around the world. It could still change depending on the ministers’ political decision. It comes as the EU has stepped up its efforts in recent years to tackle tax avoidance and evasion around the world—plans that have received fresh impetus following leaks, such as the recent Paradise papers, which exposed the scale of large-scale tax avoidance and fed public backlash against such practices.

Screening process

Throughout the past year, experts from the

bloc have been screening 92 jurisdictions to identify whether they met the EU’s standards for transparency or whether they engaged in harmful tax practices. Some of these were deemed cooperative straight away, while others, including Turkey, were spared inclusion on the list following multiple commitments to the European Union about improving transparency and engaging in fairer competition. A European government official told repor ters in Brussels last week that the fact that the final blacklist is much smaller than earlier drafts is a proof that EU pressure brings results, forcing countries to commit to tax transparency. The European Commission—the European Union’s executive arm—believes the threat of being on the list itself can act as an incentive for countries to bring their tax systems in line with EU standards, for fear of being named and shamed. The countries that made commitments to tax transparency will be subject to monitoring over the European Union this coming year, while the bloc plans to be updating the list at least once a year. But some countries, including France, have said that listed jurisdictions should also face some form of sanction. Bloomberg News

Protesters gather at a rally in Washington on October 18. The Supreme Court is allowing the Trump administration to fully enforce a ban on travel to the United States by residents of six mostly Muslim countries. AP/Manuel Balce Ceneta

US Court allows Trump’s travel ban to take full effect

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divided United States Supreme Court (SC) let President Donald J. Trump’s travel ban take full effect while legal challenges go forward, handing him a major victory and suggesting the court ultimately will uphold the restrictions. This is not a final ruling on the travel ban, though. Challenges to the policy are winding through the federal courts, and the justices themselves ultimately are expected to rule on its legality. But the action indicates that the high court might eventually approve the latest version of the ban, announced by Trump in September. Lower courts have continued to find problems with the policy. The justices offered no explanation for their order, but the administration had said that blocking the full ban was causing “irreparable harm” because the policy is based on legitimate national-security and foreignpolicy concerns. In lawsuits filed in Hawaii and Maryland, federal courts said the updated travel ban violated federal immigration law. Trump will now be able to bar or restrict entry by people from six mostly Muslim countries, even if they have a relationship with a US-based person or institution. It marks the first time the SC has let his entry restrictions take full effect. In t wo identica l orders issued on Monday, the justices effectively superseded a compromise they reached in June, when they let an earlier version of the ban ta ke par tia l effect but e xempted people w it h a “ bona fide” US connection. The new orders apply for the remainder of the appeals process, including possible SC review. Justices Ruth Bader Ginsburg

and Sonia Sotomayor dissented w it hout e x pl a n at ion . L owe r courts had partially blocked the new policy, issuing orders that tracked the Supreme Court’s June decision. The administration gambled that the high court would be more receptive to the newest version of the ban, announced on September 24. The policy bans or restricts entry by people from the predominantly Muslim countries of Iran, Syria, Chad, Somalia, Libya and Yemen. The policy also bars entry by people from North Korea and by some Venezuelan government officials. T he new polic y is not e xpected to cause the chaos that ensued at air ports when Trump rolled out his first ban without warning in Januar y. Lower courts had said people from those nations with a claim of a bona fide relationship with someone in the US could not be kept out of the country. Grandparents, cousins and other relatives were among those courts said could not be excluded. The new

SC orders don’t directly address the merits of the legal challenges. Two federal appeals courts are scheduled to hear arguments this week. The high court could agree to consider appeals later, perhaps soon enough for a ruling during the current term that ends in June.

‘Appropriate dispatch’

In its orders on Monday, the SC said it expects the appeals courts to rule “with appropriate dispatch.” The administration argued that the newest version of the ban was put in place only after nationalsecurity officials thoroughly reviewed vetting procedures on a country-by-country basis. The Department of Homeland Security would be able to add or remove travel restrictions on countries as conditions change. “We are not surprised by today’s Supreme Court decision permitting immediate enforcement of the president’s proclamation limiting travel from countries presenting heightened risks of terrorism,” White House Spokesman Hogan Gidley told reporters traveling with Trump on Air Force One. “ The proclamation is lawful and essential to protecting our homeland.” Attorney General Jeff Sessions, in a statement, called the court’s orders “a substantial victory for the safety and security of the American people.” The challengers to the policy say Trump is exceeding his authority under federal immigration law and violating the Constitution by targeting Muslims.

I think it’s tipping the hand of the Supreme Court. It suggests that from their understanding, the government is more likely to prevail on the merits than we might have thought.”—Levine

Anti-Muslim prejudice

“ Pr e sid e nt Tr u m p ’s a nt i Muslim prejudice is no secret— he has repeated ly conf ir med it, including just last week on Twitter,” said Omar Jadwat, an American Civil Liberties Union lawyer, who is the lead attorney in one of the two legal challenges. “It’s unfortunate that the full ban can move forward for now, but this order does not address the merits of our claims.” Trump last week retweeted a series of unverified anti-Muslim videos posted by a leader in a British ultranationalist movement. Hawaii Attorney General Doug Chin, who is pressing the other case against the ban, tweeted that “we agree a speedy resolution is needed for the sake of our universities, our businesses and, most of all, for people marginalized by this unlawful order.” All the rulings so far have been on a preliminary basis. The San Francisco-based 9th US Circuit Court of Appeals and the 4th US Circuit Court of Appeals in Richmond, Virginia, will be holding arguments on the legality of the ban this week. David Levine, a University of California Hastings law school professor, said that, by allowing the ban to take effect just days before the appeals court arguments, the justices were signaling their view. “I think it’s tipping the hand of the Supreme Court,” Levine said. “It suggests that, from their understanding, the government is more likely to prevail on the merits than we might have thought.” Both appeals courts are dealing with the issue on an accelerated basis, and the SC noted it expects those courts to reach decisions “with appropriate dispatch.” Quick resolution by appellate courts would allow the SC to hear and decide the issue this term, by the end of June. The appeals are Trump v. Hawaii, 17A550, and Trump v. International Refugee Assistance, 17A560. Bloomberg News and AP

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Banking&Finance

Wednesday, December 6, 2017 • Editor: Jun B. Vallecera

BusinessMirror

www.businessmirror.com.ph

3-year ADB loan for PHL infra supersized to 48%

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By Rea Cu

@ReaCuBM

he Department of Finance (DOF) said the Asian Development Bank (ADB) has increased the available funding for the country’s infrastructurerelated activities, from 34 percent of actual lending approvals covering the years 2011 through 2016 to 48 percent over the next three years. According to the DOF, the ADB, in recognition of the government’s strong resolve to bridge the country’s massive infrastructure gap, has increased to 48 percent the available funding for the administration’s infrastructure program. On top of the available funds under the ADB’s Country Operations Business Plan (COBP), loans the multilateral institution has set aside for infrastructure-related

projects equal almost 40 percent of the $3.68-billion Philippine sovereign lending program for 2018 to 2020. ADB President Takehiko Nakao updated Finance Secretary Carlos G. Dominguez III on the bank’s four new lending programs for the Philippines this year, amounting to $1.08 billion, in a recent meeting in Manila. Dominguez thanked the ADB for continuing to extend its assistance to the

Case clippings

By Justice S J Ranada Jr.

MARRIAGE ANNULMENT–psychological disorder For a personality disorder to be declared clinically or medically incurable is one thing; for a spouse to refuse or to be reluctant to perform his/her marital duties is another. Thus, where the breakdown in the relationship between husband and wife is not necessarily attributable to his “psychological disorder” but can be imputed to his work and marital stress and his ordinary human failings, the petition for annulment is denied. Lontoc-Cruz v. Cruz 11 Oct. 2017

GR 201988 Del Castillo, J

BDO gears up for seamless services via newer technology

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DO Unibank Inc., the country’s largest bank, will take on the challenge of the digital age by adopting newer technology to allow it to be more integrated in the lives of customers, making transactions and even decision-making easier and faster for them. Speaking at a recent CEO Forum titled Surviving in Times of Digital Disruption at the Francisco Santiago Hall of the BDO Corporate Center in Makati, BDO President and CEO Nestor V. Tan said digitization has greatly affected customer expectations and behavior that integration of services has become the way of the future for many industries, including banks. With lives becoming more fast-paced, Tan said, customers no longer want to move in and out of applications more so spend time on transactions, especially inside banks. He added, “As we become more immersed into the digital world, customers also expect more initiative from companies and providers to help them not only with payments but also with decisionmaking, thus, making them part and parcel of their lives.” Technology, he said, is more of an enabler, a tool, rather than a threat or a disruptor, thus, helping the banks make their services more seamless. BDO, for instance, has taken great strides to adopt to the changing behavior of its customers, most especially the tech-savvy millennials, who have greatly influenced the traditional customers. Addressing the demand to be able to do transactions anytime and anywhere, BDO customers now have an option to withdraw, pay bills, transfer funds and even invest through online or mobile banking. Meanwhile, the bigger challenge to adopting new technology, he noted, is not only to stay agile and meet customers’ needs but also to keep the bank’s focus on the kind of business that it is in, as most may easily be tempted to see themselves as tech companies because of digitization. BDO, he said, is focused on maintaining a strong relationship with its customers to thrive in the business. For Nick Spooner, regional leader of PwC’s Digital Services, Experience Centre

for Australia and Southeast Asia, digital is not a new set of channel but a cultural shift. More than about technology, digital is about new ways of solving problems, creating unique experiences, minimizing customer effort at all times, exceeding customer expectations and accelerating business growth, he added. Apart from Tan, other industry leaders who sat as panelists at the CEO Forum were Globe CEO Ernest Cu, ABS-CBN Corp. Chief Strategy Officer Raymund Miranda, SM Investments Corp. Digital Marketing Head Nicky Santiago and Google Philippines Country Head Kenneth Lingan. According to Lingan, digital has significantly changed the purchase journey of the consumers, which companies need to look out for. Describing the journey as more complex, he said consumers today are more curious, more demanding and more impatient. For his part, Santiago said digital enablement, whose key driver is really mobile, is not actually disruptive but, in fact, relieving and some ways empowering to customers. While this holds true, however, he added digital enablement is evolutionary and will not take over the existing form of servicing, especially in retail. Sharing Globe Telecom’s successes, Cu said the company has been following the journey of their customers through their mobile phones, allowing them to deliver exactly what they want. “They said they wanted social media, so we partnered with Facebook to help them to get on the trail with social media. Today, 48 million FB accounts are from the Philippines and growing,” Cu said, adding they also partnered with content providers like Netflix, NBA and Disney, as they also saw the trend that their customers are also into videos. Meanwhile, ABS-CBN’s Miranda said that while the trend is really toward digital and change is inevitable, some things remain the same. “Netflix would have not been the Netflix that we know now without House of Cards. So when I say that, it is still about good stories, great characters, good storytelling. People will follow the content,” he added.

Philippines, including programs like Encouraging Investment through Capital Market Reforms Subprogram 2, with funding amounting to $300 million; Improving Growth Corridors in the Mindanao Road Sector for another $380 million; the Facilitating Youth School-to-Work Transition for $300 million, and the establishment of an Infrastructure Preparation and Innovation Facility for $100 million. “Thank you to a stronger, faster and better ADB,” Dominguez said. The government plans to spend P8.4 trillion under its “Build, Build, Build” program to rapidly modernize the country’s infrastructure over the medium term. From 2011 to 2016, actual ADB loan approvals for the Philippines under the COBP totaled $1.45 billion for sustainable and climate-resilient infrastructure, $2.57 billion for good governance and finance and $300 million for employment and education. The new COBP covering the period from 2018 to 2020 will provide $1.9 billion for sustainable infrastructure and development, $1.2 billion for regional development and finance and $900 million for human development, according to the ADB. The ADB’s sovereign lending program for the Philippines has made available some $920 million in funds and another $400 million on standby for 2018; $1.4 billion for 2019; $1.36 billion for 2020 and $600 million on standby. Among the projects eligible for sovereign financing include the Davao Public Transport Modernization Project worth $70 million, Expanding Private Sector Participation in Infrastructure Subprogram 2 for $300 million, Inclusive Financial Sector Development Program for $300 million, Secondary Education Support Project worth $300 million, Metro Manila Transport Project worth $100 million, Metro Manila Water Supply Project for another $200 million, Central Spine Connectivity Project Phase 1 worth $100 million, Mindanao River Basin Flood Control Project worth $160 million and the Expanded Social Assistance Project worth $300 million. At the meeting, Dominguez also expressed his support for a multifunction global support platform for infrastructure projects called the SOURCE as a vital tool to strengthen the government’s technical capacity to pursue its infrastructure program. “I’d like to thank you for funding the capacity buildup, for the technical consultants, and also we would like to support your use of the United Nations-backed SOURCE database for PPP [public-private partnership] projects. We will support it 100 percent,” Dominguez said. Participation and use of the SOURCE platform increases the visibility of infrastructure projects to government partners, multilateral institutions and global investors, the DOF said.

The future of blockchains in business By Patrick Palacios

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ortune magazine recently came out with an article saying that Mastercard has started using blockchain, albeit in a limited manner, to pay for goods and services. According to the report, Mastercard is the second company in the Fortune 500 list that uses blockchain technology (the first being IBM). It’s worth noting that Mastercard won’t be using blockchain in the traditional sense, where they act as a ledger of transactions in the specific cryptocurrency to which they were tied—bitcoin for example. It will, instead, accept traditional local money but will use blockchain to transfer these to partner banks and merchants around the world. If you’re getting confused with the jibber-jabber in the above paragraphs, you don’t have to worry, because few people actually know what blockchain is and what it does. In fact, it’s still so confusing that, as Fortune stated, even Mastercard is doing away with the basic method of using blockchain, which shows that they are stepping prudently into new and uncharted territory.

The rise of digital currencies

Digital currencies can be quite difficult to understand, let alone explain without going into technical details. Maybe you have heard of bitcoin, that you can use it to buy goods and pay for services without the use of money, that it is not regulated by any financial institution, and that its value changes more often than you change your shirt. When bitcoin started in 2009, it was valued at less than $1, but eight years later, it’s now worth about $8,000. That being said, few companies would transact using bitcoins (although adoption has been increasing) and one would wonder why bitcoins are so expensive. And that’s just for bitcoin. Other digital currencies out there include Ether, Blackcoin, Dash and XEM, to name a few.

Blockchains: Distributed digital ledger

But let’s not lose our heads over bitcoin and take Mastercard’s example. Let’s just focus on the underlying technology that made bitcoin and other digital currencies happen—blockchains. The basic definition is that blockchain is a digital ledger of all historical transactions of a block of information (in the case of bitcoin, all the payments and transfers of a single bitcoin since the time it was created up to the present). Every time that this single block is transferred or received by any computer or device in any network, a new block is created and is added to the rest of the records—thus “chaining the blocks.” This seems pretty easy to understand since it’s just like adding a transaction record to a physical bookkeeping ledger.

But there is an additional layer that makes blockchains far better; instead of just creating one blockchain that contains all the records, the transaction records are also distributed across every blockchain in an entire network. This principle of distributed database of all records makes blockchain far more secure than just a set of separate digital ledgers. Blockchain cannot be tampered with unless the other blockchain in the entire network are also changed. That’s besides the fact that information in blockchain are also encrypted, making them even more difficult to manipulate.

Industry use of blockchains

For the most part of its history, the blockchain technology has been in use in digital currencies, a novelty that very few understood or wanted to know about. The idea was conceptualized by the “father” of bitcoin, a person known as Satoshi Nakamoto, whose real identity remains a mystery. And even he may not have thought of block chain technology’s use beyond bitcoin, as stated in his seminal paper. But some industries are seeing viable applications for blockchain. The Massachusetts Institute of Technology started giving out graduate certificates in blockchains via an app, which they called Blockcerts Wallet. There is also a company in the United States that is testing blockchain technology for “smart” energy grid distribution. Air France applied blockchain to its supply-chain management for aircraft maintenance. Even the US Centers for Disease Control is looking at the technology to help public-health workers respond faster and more efficiently to crises. More recently, the Russian division of burger chain Burger King came out with WhopperCoin, which is part of a loyalty program using blockchain. In it, buyers get a virtual currency every time they purchase from the burger chain, then exchange the WhopperCoin with partner merchants. This goes to show that blockchain isn’t just for back-end corporate use, but they’re also as good as front-line services for consumers and can link up with other merchants for better service. The technology that was primarily built to record transactions of bitcoin is seeing some viable use in various other industries because of its efficiency in collecting and keeping data records. These applications are enabling a new process of managing records and are also introducing new ways of thinking relative to production, finance management, to customer relations. Having new ways of thinking only improves the quality of services and creating efficiency within an organization, a winwin situation for both the company and its clients. Indeed, it’s exciting to see where blockchain technology will go next.

President urged to approve merger of state guarantee agencies

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Filipino-French joint venture building a $25-million pilot phase of an ocean tidal power plant in San Bernardino Strait, envisioned to be the first in the Philippines and the Association of Southeast Asian Nations region, has urged the government to approve the creation of a single state-run guarantee agency. By integrating the four guarantee agencies, the country will be in a better position to finance developmental projects by the private sector, Finance Secretary Carlos G. Dominguez III earlier said. “Ocean power needs strong government support. The kinetic energy of tidal currents produces stable electricity supply. This is real ‘grid smart’ technology because it can provide steady ancillary service supporting the transmission of electricity from generation to customers up to far-flung areas,” said Antonio A. Ver, president of H&WB Asia Pacific (Pte. Ltd.) Corp. San Bernardino Ocean Power Corp. (SBOPC) is the special purpose company of H&WB and French marine energies’ technologies and engineering company Sabella Société par Actions Simplifiée (Sabella) for an ocean power-plant project aimed to boost the renewable-energy portfolio of the country. The pioneering project was shortlisted in May 2017 for possible financing under the fifth funding cycle of the International Renewable Energy Agency (Irena)/

Abu Dhabi Fund for Development (ADFD). However, ADFD requires a government guarantee letter and eventually a guarantee agreement for loan applicants that are private entities, such as SBOPC. In its report, entitled “The Renewable Readiness Assessment, The Philippines,” Irena has recognized the abundance of ocean energy in the country due to its inherently archipelagic geography. The report also cited the San Bernardino Strait project. The project is also consistent with the Philippines’s climate-change initiatives. In a show of commitment to the groundbreaking project, H&WB and Sabella officials will attend the historic “One Planet Summit” on December 11 and 12 in Paris, France. Billed as a follow-up to the landmark Paris climate accord reached in 2015, the summit is expected to gather around 2,000 people from the government and the private sector from more than 100 countries to focus on financing to combat climate change. Ver said the government’s plan to establish a single government-guarantee system, which was endorsed in October by the governance commission for government-owned or -controlled corporations for President Duterte’s approval, will bolster the chances of SBOPC getting the international funding. “The ADFD loan facility is an effective financing strategy for the San Bernardino ocean power plant and securing the funding will certainly

accelerate the construction and development phases of the project and jumpstart the development of ocean energy,” Ver added. He said the plant is a “scalable proof of concept” that would allow ramping up tidal in-stream energy conversion technology, an ocean-power technology mostly adaptable, or the technology-ofchoice, in Philippine waters. The huge potential of San Bernardino Strait for ocean power plant is expected to provide reliable and clean power supply initially to 25,000 people living in the island of Capul, which is off-grid under the Small islands Power Utility Group of the National Power Corp. The project could spur economic development in nearby municipalities of San Antonio and the major towns of the provinces of Sorsogon and Northern Samar within SBOPC’s concession areas when power is switched on. The capacity of the tidal farm increases to electrify Calintaan and Matnog in Sorsogon that have a demand of up to 20 megawatt for the next three years. The project has undergone public consultation with the Renewable Energy Management Bureau of the Department of Energy on October 24 in Capul. The Philippine National Oil Company Renewable Energy Corp. has also signified its interest to invest in the project. Capul’s local government and communities have been supportive of the project toward reaching its fulfillment.

ExportUnlimited BusinessMirror

Editor: Efleda P. Campos • Wednesday, December 6, 2017 A9

DTI-EMB honors outstanding exporters during 2017 NEC

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HE Department of Trade and Industry-Export Marketing Bureau (DTI-EMB) on Tuesday awarded Philippine companies for their outstanding export performance during the National Exporters’ Congress (NEC) held at the Philippine International Convention Center in Pasay City. Honored for Top Sectoral Award were Texas Instruments Philippines Inc. (Electronics), Pilipinas Kao Inc. (Chemicals), Taganito HPAL Nickel Corp. (Other Mineral Products), Hanjin Heavy Industries and Construction Group (Machinery and Transport Equipment), Shin-Etsu Magnetics Philippines Inc. (Electronic Equipment and Other Parts), House Technology Industries PTE Ltd. (Woodcraft and Furniture), Nestle Philippines Inc. (Processed Food and Beverages), Dole Philippines (Fresh Bananas), Takata Philippines Corp. (Metal Components), Pilipinas Kyohritsu Inc. (Ignition Wiring Sets), Cargill Oil Mills Philippines Inc. (Coconut Oil) and Metro Wear Inc. (Articles of Apparel and Clothing Accessories). Three of the awardees—Texas Instruments, Pilipinas Kao and Metro Wear—were conferred the Hall of Fame Award for posting the highest export revenues for the past three

years in their respective sectors. Data from the Philippine Statistics Authority in 2016 served as the basis for giving the awards to the companies. Also recognized were three regional exporters—one each from Luzon, the Visayas and Mindanao—who stood out for their remarkable international success in penetrating global markets and have shown strong commitment to national growth and economic development through competitive Philippine exports. The Most Outstanding Regional Interactive Platform for Philippine Exporters (Ripples) Plus Award was given to Peter Paul Philippines Corp., Profood International Corp. and Philbest Canning Corp. Excellence Awards for Services Exports was also conferred to services companies recognized to have shown exemplary contribution to the industry and exhibited excellence in their respective fields. Also awarded were those that started small, but

were able to excel in overseas-market penetration and have executed outstanding performance and contribution as an industry player to the sector as manifested through a selection criterion and nominated by the industry and association. Awardees were Advanced World Solution Inc. Information-Technology-BPM, Affinity Express Philippines Inc. (Creative Services), Artworks Aviation Academy (Education Services), ExlService Philippines Inc. (Health Information Management) and Potato Corner (Franchising Services). The triple awarding served as the highlight of the weeklong celebration of National Exporters’ Week (NEW), a yearly event held during the first week of December organized jointly by the DTI-EMB, the Export Development Council (EDC) and the Philippine Exporters Confederation Inc. (Philexport). This year’s celebration centered on the theme “Innovate. Collaborate. Export!” The NEC was attended by over 700 exporters and representatives from business-supportorganizations,government agencies and the academe participated. Theeventwasopenedinthemorningwith a showcase of a total of 29 Philippine government agencies and exporters as export enablers and stakeholders. This was followed by Usapang Exports, an information session about “Boosting Philippine Exports through Innovation and Collaboration.” The session focused on the following topics: “Promoting Exports through Outbound Business Matching Missions,” “Foreign Trade Service Corp Overview

THE Top Sectoral Export Award for Electronics is conferred to Texas Instruments Philippines Inc. (TIPI) represented by TIPI Director for Finance Andrew Wheeler (third from left) and TIPI Director for Human Resources Kristine Mangaliag. They are flanked by (from left): Department of Trade and Industry’s Export Marketing (DTI-EMB) Director Senen M. Perlada; Manila Mayor Joseph Ejercito Estrada; DTI Undersecretary Nora K. Terrado; and PhilExport President Sergio Ortiz-Luis Jr.

of Services” and “Economic Achievements and Key Outcomes of the Philippine Asean Chairmanship 2017.” Also discussed were “Enhanced Training Programs for Exporters” and “Start up in the Philippines, Scale up to the World.” This was followed by panel discussions in the afternoon with timely subjects on “Expanding the Global Market through Innovation” and “Addressing Industry Challenges through Collaboration.” The discussions covered topics, including accessing markets, innovation road map and bill and other

support services provided by both the public and the private sectors. Through these activities of the NEW, the DTI-EMB aims to continue to strengthenitsprogramofferingsandservices by reaching out to more exporters across the country. “With this annual NEW celebration, we seek more initiatives and discussions on how we can further help the sector,” DTI-EMB Director Senen M. Perlada said. Also part of the celebration is the ongoing NEW Bazaar, a retail-selling event of Philippine products from the

country’s direct and indirect manufacturers, which started on December 4. About 20 exhibitors are participating by selling their products and services, ranging from fashion accessories to food products in the DTI International Building along Gil J. Puyat Avenue in Makati City. Unlike previous years, the bazaar is running for two weeks this year or until December 15 except on weekends. The bazaar was organized by the DTI-EMB, in cooperation with the EMB Employees’ Association.

A10 Wednesday, December 6, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

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editorial

Timely interventions needed to attain bird flu-free status

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ust when the government thought that the bird-flu crisis is over, the virus struck again in Cabiao, Nueva Ecija. Avian influenza (AI) affected a layer farm in Cabiao, forcing the owner to cull some 42,000 birds. According to the Department of Agriculture (DA), the Cabiao flock was hit by the same strain (H5N6), which killed thousands of birds in Pampanga. Agriculture Secretary Emmanuel F. Piñol announced that there was an outbreak in Cabiao days after culling operations ended on November 22. Piñol said the government decided not to make a big fuss out of the recent AI incident as the DA already knew what to do. Apart from the AI management protocol, Piñol disclosed that “additional measures” were rolled out to make sure that bird-flu outbreaks are immediately controlled. While it is unfortunate that the Philippines now had to contend with the AI virus, the country’s experience yielded valuable lessons, which are now serving well both the industry and the government. Poultry growers are now aware of the need to immediately report suspicious bird deaths. It appears that the government has also found a way to manage and control the outbreaks without causing panic among industry players and consumers. Proof of this is the fact that the farm-gate price of broilers and retail price of dressed chicken have not fallen dramatically, unlike in August, when Luzon producers incurred huge losses. At the time, the farm-gate price of broilers in Pampanga nosedived to as much as P15 per kilogram, a level that is not even enough to allow local growers to recoup their production cost. The recent outbreak, however, would hit exporters the hardest. The government had been planning to notify the World Organization for Animal Health, or OIE, by December 20 that the Philippines is free from bird flu. Because of the Cabiao incident, the Philippines had been forced to reset its countdown to bird flu-free status. The earliest notification to the OIE could be made by the last week of February. Even before the discovery of the bird-flu outbreak, exporters of poultry products from the Philippines have to contend with Thailand, which produces cheaper chicken products. The prolonged absence of Philippine poultry from major markets, such as Japan, which also buys chicken products from Thailand, bodes ill for local exporters. Unfortunately, Philippine poultry would remain missing from the shelves of foreign supermarkets because the country has not yet achieved bird flu-free status. Attaining bird flu-free status requires timely interventions, as well as more vigilance from stakeholders in the poultry sector and the government. The virus struck a town about an hour away from Jaen, where an outbreak occurred in August. The DA could consider making good on its promise to regularly inspect livestock and poultry farms, particularly in landlocked Luzon, as the virus easily spreads in these areas. The government must not stop searching for answers and for ways to prevent bird flu from spreading to other areas if it wants the regain the trust of the country’s foreign customers. Since 2005

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Universal counterterrorism, an existential requirement Teddy Locsin Jr.

Free fire Continued from A1

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hey seized control of a considerable part of the city and took civilians as hostages. The attack is arguably the most destructive act of terrorism in my country’s history. It caused an unprecedented humanitarian crisis, with around 200,000 persons displaced by the fighting. After over four months, the conflict caused 146 deaths among military and police forces, while 673 terrorists have been killed. A salutary but still a bad ratio. The state must not fritter away resources from the main priority of improving this nation. The sharp edge of the sword of security is dulled by the long peace we’ve enjoyed since democracy was restored. Civilian casualties number 47 dead. The civilian killings were mostly of non-Muslims in the terrorists’ attempt to spark sectarian violence in the expectation their co-religionists would join in the carnage. But the people of Marawi would have nothing to do with the terrorists. There are reports of Muslim residents hiding their Christian neighbors. Our government demonstrated forbearance, taking care not to un-

leash a greater force to minimize civilian casualties, even at the cost of more military and police casualties—in what became a slow, punishing, door-to-door, streetby-street fight. Military operations were carefully calibrated to achieve this aim, consistent with International Humanitarian Law—even if the government lost face by the slow and deliberate progress of its forces. We pushed for the establishment of a “peace corridor” through the city to allow the safe passage of trapped civilians and enable vital supplies

Our government demonstrated forbearance, taking care not to unleash a greater force to minimize civilian casualties even at the cost of more military and police casualties—in what became a slow, punishing, door-to-door, street-by-street fight. Military operations were carefully calibrated to achieve this aim, consistent with International Humanitarian Law—even if the government lost face by the slow and deliberate progress of its forces.

to reach those unable to leave their protected positions within the battle zone. With regard to the tens of thousands displaced, the government addressed health and sanitation concerns in the evacuation centers; but most of the displaced quickly found safety and shelter with families and friends throughout the country. A testament to the strength of the Filipino family system, the Philippine foreign secretary said. Harmony and peaceful coexistence between Christians and Muslims, in a climate of understanding and trust, had long set Marawi apart as the center of religious tolerance in Mindanao. That is why the terrorists chose Marawi to stake out their first presence in my country. If they succeed there, they will have

better chances elsewhere. In the event, they did not. Through Marawi, we witnessed the collapse of Daesh in Iraq and Syria, only to see it claw back in our part of the world. In the Philippines we have discovered the intimate and symbiotic relationship between terrorism, poverty and the illegal-drug trade. Yes, the illegal-drug trade with which so many humanitarians have suddenly become enamored. One wonders why. Terrorists were able to gather a motley assortment of extremists, criminals, mercenaries and foreign fighters to take control of Marawi, and reestablish in our part of the world their shattered caliphate in the Middle East. Many of our best and bravest soldiers died in Marawi, some beheaded. Fantastic and the humanitarian outcry was to go easy with the military effort whatever the cost to soldier casualties. The nation is eternally grateful to our glorious dead. But the Armed Forces of the Philippines have regained full control of Marawi, which must now be rebuilt—not least upon the unshakeable foundation of its inhabitants’ goodness. Terrorism found no friends or sympathizers there. With our focus and determination, and continuing support and assistance from the See “Locsin,” A11

Social-media shaming is good (in moderation) By Kara Alaimo Bloomberg View

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ave you ever lost your temper with a customer service representative, or argued with your partner in a restaurant? If so, you could become a YouTube celebrity. That’s because a cottage industry has grown up around humiliating people and organizations by exposing their bad behavior online—otherwise known as public shaming. As Sue Scheff and Melissa Schorr report in their recent book Shame Nation: The Global Epidemic of Online Hate, now anyone can record your worst moments and sell the video evidence to one of several companies which buy the rights to embarrassing clips. (Those companies then make money from YouTube ad sales and fees from television shows that replay the videos.) In other words, there’s now a financial incentive for strangers to publicly shame you. Sometimes, people are exposed for relatively minor errors of judgment that come to define them for the rest of their lives. Other times,

they’re shamed for things they didn’t even do—like when people have been incorrectly identified as criminals or white supremacists online. Either way, good luck getting a job or a date afterward. Such episodes can be so harrowing that they cause post-traumatic stress disorder, according to Scheff and Schorr. It’s a situation early Americans tried to prevent. Benjamin Rush, who signed the Declaration of Independence, argued that the practice “is universally acknowledged to be a worse punishment than death.” Jon Ronson, author of “So You’ve Been Publicly Shamed,” reports that punishment by public shaming—such as parading criminals through the town square—was abolished in every state but Delaware by 1837. But shaming can also be good for society, because it allows us to hold people and organizations responsible for bad behavior. Witness the ad Dove posted in October showing a black woman turning into a white woman with its product. The picture immediately generated lots of criticism online, and rightly so. The company apologized. Similarly,

in January, activists exposed the identity of Mike Enoch, a prolific podcaster who founded the web site The Right Stuff. Enoch, who peddles in horrific racism and anti-Semitism, deserved to be called out for his abuse. He was fired by his employer. Or take Twitter’s decision to suspend the account of actress Rose McGowan in October while she was talking about sexual harassment. While Twitter said it was concerned that McGowan publicly posted someone’s personal phone number, it should have removed that specific tweet rather than freezing her entire account. Some women (including me) responded by boycotting Twitter for a day. That was an appropriate way to demonstrate disapproval. So, when is it okay to cyber-shame people and organizations, and when is it unreasonable and grotesque? I suggest a few rules. First, we should make sure we have our facts straight. For example, if someone tweets from a verified Twitter account, an event is reported by a legitimate news organization, or a person is convicted of a crime, it’s safe to assume it hap-

pened. But we should never cybershame someone unless we’re absolutely certain they’ve done what we’re complaining about. Second, we should consider whether the behavior we’re upset about is likely to be a fair representation of the actor’s character. If a company or person posts something on social media or gives a statement to the press, it’s fair to criticize them for it, because they’ve chosen to present themselves to the world in that manner. But, even though people are always responsible for their behavior, we should consider not exposing others for minor infractions—like the exhausted mom who has a meltdown on the playground—unless there’s evidence the behavior is part of a larger pattern. Such episodes could represent their most terrible transgressions and not who they typically are—but if we share it on social media, it could define them forever. In all instances, we must be civil. We shouldn’t call people names. Rather, we should rationally argue why we think they’re wrong. Let the person who has never had a bad day be the first to tweet.

Opinion BusinessMirror

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Maintenance, the missing key in DOTr’s PUV modernization

The stunting of the Filipino child Edgardo J. Angara

Michael Makabenta Alunan

on the contrary

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ne fundamental missing component in the government’s Public Utility Vehicle (PUV) Modernization Program is maintenance that will guarantee no engine downtime, which is crucial to address the big gap between vehicle manufacturers’ two-year warranties against the seven-year bank financing.

“Fools ‘rust’ in?” Commuters deserve a rush in long-due reforms to ease traffic and modernize the old decrepit jeepneys, but a program that could prevent rust, and thus assure no engine breakdown and continuous daily amortizations, has inadvertently been ignored in the rush to implement modernization. Section 21 of the Clean Air Act explicitly mandates the Department of Transportation (DOTr) to implement emission standards through “inspection” and “maintenance.” It already has the Motor Vehicle Inspection Service, but has no policy requiring periodic “maintenance” on all vehicles. As public transport undergoes 14 hours of operations and passenger overloads, breakdowns are likely, thus affecting amortization payments and the overall success of the DOTr’s modernization. On jeepney prototype designs, the rush may result in faster rust even before the vehicle financing is fully paid can be evidenced by the haste on how the design standards were done by the Bureau of Product Standards (BPS) of the Department of Trade and Industry. On queries on the absence of standards on “structural strength,” BPS Assistant Secretary Ernesto Perez said “the scope of DPNS 2126:2017 (for jeepney body standards) is limited to dimensional limits, hence, structural strength and strength of materials were not included.” The Department of Science and Technology should have been involved to guarantee material strength to assure vehicles will last beyond the amortization period. Assuming standards are limited to mere dimensions, why limit to a single set of dimensions? There are varying characteristics for transport routes, whereby some demand longer jeepneys traveling long distances along highways (i.e., Antipolo to Cubao), while some need shorter jeepneys in short routes and narrow street corners. In short, one cannot have a one-formula-fits-all design. Oppose, but pose no alternatives? Some transport groups are neither of any help as they just oppose for opposition’s sake, but do not offer viable alternatives. Leading transport strikes is Pinagkaisang Samahan ng mga Tsuper at Opereytor Nationwide (Piston), which made off-tangent “default” answers, claiming the solution is “national industrialization,” says Piston leader George San Mateo during Mareng Winnie Monsod’s Pasaway TV show. Land Transportation Franchising and Regulatory Board Chairman Martin Delgra III appeared cooler, claiming “local vehicle assemblers were consulted, but they admit they could not produce everything locally. In the absence of national industrialization, will Piston continue to oppose modernization?” he asked, adding what has been missing in the discussion is the interests of the mananakay (commuters). Mareng Winnie told Piston they can’t just oppose without offering “substitute solutions” or alternatives. Transport groups may complain and protest all they like, being protected by the Constitution, regardless of public perception whether these are right or wrong. However, they must offer counter solutions, otherwise they lose the public’s respect. Franchise, a privilege, not a right. In the case of franchises, they must remember that these are not rights, but privileges extended

to them, to serve the public. Their right to protest also stops when they infringe on the rights of others, like the destruction of property (two MMDA tow trucks) during a recent transport strike. If Piston cannot reason out well, it may be considered unreasonable and could not gain the public’s sympathy. This also applies to Jun Magno’s Stop and Go Coalition, which has been behind the tigil pasada transport actions. How PUV modernization is handled, amid prevailing problems, is also manifesting conflicting vested interests on one hand, and the emergence of die-hard Luddites, who fear and oppose new technologies, which Piston may unconsciously paint itself in a corner, thus drowning their legitimate issues. Piston may be Left out, and no longer be doing Right if it digs in on its die-hard position. It does not realize it can ride on the modernization, influence its program features and empower its members into cooperatives to operate allied businesses. Apparently, positions on both extremes will only harden if no concrete alternatives and solutions are put on the table. Costs not clear yet? While the government may think figuratively that the “coast is clear” in its implementation, it seems it has made again a one-formula-fits-all package in terms of financing costs. Government entities do not seem to share notes with each other, particularly on their respective resources and capabilities. The DOTr’s financing package involves a seven-year repayment period, amortizations of P850 a day, a 6-percent interest rate, and an equity subsidy of P80,000 for every jeepney replaced. The DOTr may not be aware there is an available government financing payable in 10 years, Bangko Sentral ng Pilipinas’s Credit Surety Fund (CSF), which can greatly lower daily amortizations to more affordable levels. The CSF is intended for marginalized and organized groups, preferably cooperatives, which is precisely why the Cooperative Development Authority has put up a separate division handling CSF-funded projects. Koops an opportunity ignored? Modernization requires industrial consolidation and the logical choice for jeepneys are forming cooperatives and not corporations. Unfortunately, many big transport groups oppose cooperatives. For whatever reason, one can only surmise. Apart from access to the CSF, there are multiple benefits from cooperativism. The DOTr must issue a circular encouraging koop-building. After all, government financing with koops enjoy repayments of 97 percent, unlike associations with only 32 percent. And because maintenance is vital, it is advisable the koops be supported with vehicle maintenance centers to prevent breakdown downtimes and serve as additional sources of livelihood to supplement their earnings as the amortizations are already as much as the average operator’s boundary income of P800 a day. There are routes even getting P600 a day, and routes earning P1,500 a day, which opens up the need for segmentized solutions and packages, which entails a whole discourse and consultative process. E-mail: mikealunan@yahoo.com.

Wednesday, December 6, 2017 A11

Part Two

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AVE The Children Philippines recently launched its third Media Awards to recognize journalists, photographers and video producers who have provided outstanding coverage on child malnutrition in the Philippines today, in particular of children under 5 years old. Alex Badayos’s “Food For Tot” was awarded the Most Outstanding Photograph, which is a black-andwhite depiction of a toddler trying to eat a bowl of rice. When he received the award, Badayos said that he took the picture to show that while malnutrition is a global problem, it also happens right in his neighborhood. Andres Patricio Bonifacio’s “Si Inay at ang kanyang inakay,” a picture of a mother and her three children sitting in a riverside shanty, won the People’s Choice Award for photography. A public school teacher, Bonifacio said he’d share his cash prize winnings to start a feeding program at the school where he teaches.

The Most Outstanding Article award was given to “Wasted Children” by Cherry Ann Lim, who writes for one of Central Visayas’s major newspapers. Hailing from Cebu, Lim said that while her province is among the richest in the country, almost 1 million there lived in poverty, pointing to a high prevalence of malnutrition. Through her reporting, Lim found that as of SY 2016 to 2017, up to 11 percent (or around 36,000) of the children enrolled in public elementary schools under the Department of Education’s Cebu Provincial School Division were undernourished—being either underweight or stunted.

Save The Children’s Media Awards was about honoring print and broadcast journalists who truly care about our children. As they said, the awards gave them extra motivation to spread awareness among Filipinos about the scourge of malnutrition among our children. Joseph Tristan Roxas, meanwhile, received the People’s Choice Award for the article, “Senate hikes P13 daily daycare meal allowance to P20.” A journalist for one of the country’s prominent online news outlets, Roxas said the awards have become an added motivation for him to work harder, not just for his readers, but also for the children who really need the public’s attention. Coverage on North Cotabato by GMA News’s Biyaheng Totoo was awarded the Most Outstanding Special Feature. Members of the production team said the work they do is “always for the others, the marginalized, the voiceless and the oppressed.” The Most Outstanding Short Film award was given to Mukha by

ABS-CBN News Channel. Members from the ANC team said that among documentarists, it may seem that all the stories about malnutrition have already been written. But in their view, what’s more important is that media men and women keep on writing these stories because malnutrition is still widely experienced today. Gutom by Reel Time of GMA News was awarded Most Outstanding Full Length. Gutom was about Baby Ruel who was 2 years old but weighed as much as a 5-month-old baby. Members of the production team said that once their documentary aired, assistance for Baby Ruel came flooding in, such that today, he receives regular checkups. They said that as media professionals, they are given both the power and responsibility to use different media platforms to help change people’s lives. Save The Children’s Media Awards was about honoring print and broadcast journalists who truly care about our children. As they said, the awards gave them extra motivation to spread awareness among Filipinos about the scourge of malnutrition among our children. E-mail: angara.ed@gmail.com, Facebook and Twitter: @edangara

International Cooperative and Mutual Insurance Federation Dennis B. Funa

INSURANCE FORUM

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he International Cooperative and Mutual Insurance Federation (ICMIF) is the only international association dedicated to cooperative and mutual insurance. It is headquartered in Cheshire (near Manchester), United Kingdom. It has its regional offices in Washington, D.C., USA; Tokyo, Japan; and Brussels, Belgium. It is the insurance sector organization of the International Co-operative Alliance (ICA), a non-governmental cooperative federation or, more precisely, a cooperative union representing cooperatives and the cooperative movement worldwide. ICA was founded in 1895 to unite, represent and serve cooperatives worldwide. ICMIF was established originally by five national cooperative insurance associations, one in each of Belgium, France, Italy, the Netherlands and the United Kingdom. It has seven other sectoral organizations. It was originally just an Insurance Committee of the ICA. It later adopted the name International Cooperative Insurance Federation (ICIF) in 1972 until it changed its structure and its name was changed to ICMIF in 1992 in Tokyo, Japan. ICMIF is run and governed by its

Locsin. . .

continued from A10

international community—for which we are thankful, peace and order, human rights and the rule of law will prevail again in Marawi. The Philippines condemns terrorism anywhere in the world, however inspired—by religious madness or individual perversity, like that in Las Vegas and now in New York. We abhor it in all its manifestations, wherever, by whomever and against whomsoever committed. We can only agree with the American president—as we must always make sure—that terrorism is only for losers. Terrorism is an evil so pure, it must be countered with means that are sure—a global effort against terror on every front by every society worthy to be called one and not a gang. Terrorism is a global problem no country can tackle alone. President Rodrigo Duterte understands this. Counterterrorism is a cornerstone of his national agenda, and this in-

member-organizations. As of 2017, a member of its board of directors is from the Philippines, Dr. Jaime Aristotle Alip, the founder of the Center for Agriculture and Rural Development Mutually Reinforcing Institutions. Among the other members from the Philippines are the ASKI MBA, CARB MBA, CISP, CLIMBS, KMBA, Natcco MBA and Rimansi. Indeed, the advocacy of these organizations and the individuals that compose them are microinsurance, mutual insurance and mutual benefit associations (MBAs). To date, it has about 290 members from over 70 countries with over $300 billion in premium income. ICMIF exists to give support and advice to cooperative insurance firms and mutuals. About 15 percent of its members come from the Asian region, 51 percent from Europe, 22 percent from the cludes strengthening cooperation with our regional partners, especially Indonesia, Malaysia and the rest of Asean, and with Australia and the United States, so that the Philippines can have a more effective defense system to crush terrorism when it will not be deterred. The Philippines addresses violent extremism through the “whole of nation” approach; not least one that endeavors energetically to get rid of the whole lot of them. We engage women, the youth, Muslim and Christian leaders and teachers, NGOs, academe, and the private sector, as partners in counter-radicalization, and as a collective force for moderation, peace, democracy and development. We raise the security awareness of local communities, and implement community awareness and target hardening programs within the framework of the rule of law and human rights as the fundamental approach to fighting terrorism. We continue to train law enforcement and security experts and increase

ICMIF exists to give support and advice to cooperative insurance firms and mutuals. About 15 percent of its members come from the Asian region, 51 percent from Europe, 22 percent from the Americas and 9 percent from Africa. In terms of activities, 61 percent are mutual, 28 percent are cooperatives, and 5 percent are takaful. The cooperative and mutual insurance sector is the fastest growing segment of the global insurance sector.

Prevoyance Sociale Belgium. In January 2015 ICMIF launched the 5-5-5 Mutual Microinsurance Strategy. In a period of five years, ICMIF plans to develop mutual microinsurance in five countries, reaching out to 5 million uninsured, lowincome households. Today, ICMIF holds its regular biennial conference. The ICMIF Development Function was formally established in 1963 and since then, ICMIF has facilitated the creation and development of mutual and cooperative insurers in emerging markets through technical and capital support. The Philippines is part of the Asia and Oceania Association (AOA) of ICMIF. The AOA was established in October 1984 as a regional association of ICMIF (then ICIF) to promote cooperative and mutual insurance activities, mutual friendship and exchange of information among ICMIF members in the Asia and Oceania region. The first member of the AOA from the Philippines was the Cooperative Insurance System of the Philippines Inc. The AOA Secretariat is headquartered in Tokyo, Japan. As of 2014, it has 43 member-organizations from 13 countries. It is notable that the United Nations designated the year 2012 as the International Year of Cooperatives.

Americas and 9 percent from Africa. In terms of activities, 61 percent are mutual, 28 percent are cooperatives and 5 percent are takaful. The cooperative and mutual insurance sector is the fastest-growing segment of the global insurance sector. A mutual insurance company is an insurance company owned entirely by its policyholders. In June 2016 the Association of Mutual Insurers and Insurance Cooperatives in Europe integrated with ICMIF. There are, of course, other regional associations such as the National Association of Mutual Insurance Companies, which was founded in 1895, covering memberships from the US and Canada. ICMIF was formed in 1922 by a group of five cooperative insurance companies under the leadership of Joseph Lemaire, then CEO of la

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

their capacity, in partnership with grassroots efforts, to detect and stop threats from homegrown violent extremists. Although there is criticism about involving communities in the detection and preemption of crimes such as the main contributor to terrorism: the drug trade. We look forward to working with Undersecretary-General Vladimir Voronkov and his team at the new UN Counterterrorism Office to bring into a cohesive whole the work on counterterrorism by member-states and the UN. Russia’s work, together with Iran, in the extirpation of Daesh in Syria is exemplary. Key areas of cooperation we wish to deepen with the UN and non-UN actors, and with regional and bilateral partners, include threats to commercial aviation, nuclear terrorism, cybercrime, terrorist financing, support for victims of terrorism and capacity building. Two years ago the Philippines adopted a landmark law, the Strategic Trade Management Act, which seeks to support counterterrorism

by preventing the proliferation of weapons of mass destruction. This complements our legal regime against terrorism and extremism, showcased by our Human Security Act of 2007, and our anti-money laundering law (in which I played a crucial part) and anti-terrorist financing law. Our Anti-Money Laundering Council, in cooperation with the UNODC, has been conducting trainings on countering the financing of terrorism. As chairman of Asean this year, President Duterte engages Asean leaders in redoubling cooperative regional efforts to address terrorism and violent extremism. He will do so again at the Asean Summit in Manila. There can be no political accommodation with terrorism. We cannot buy safety from terrorism by yielding to any of its demands. We cannot live with terrorism because it will not let us live. Together, we remain undaunted and determined to fight terrorism and secure to all, within our borders and outside the blessings of peace and safety. Thank you.

2nd Front Page BusinessMirror

A12 Wednesday, December 6, 2017

Duterte’s martial-law edict legal, SC rules with finality

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By Joel R. San Juan

@jrsanjuan1573

HE Supreme Court (SC) on Tuesday stood pat on its ruling issued in July affirming the legality of President Duterte’s declaration of martial law in the entire Mindanao region.

“In the matter of the consolidated petitions…the Court, voting 10-3-1, denied with finality for mootness and lack of merit all three motions for reconsideration filed by petitioners from the Court’s decision dated July 4, 2017,” the resolution stated. SC Spokesman Theodore O. Te said the 15-man High Tribunal made the decision at its regular en banc session on Tuesday. In its July 2017 ruling, the Court held that there was sufficient factual basis for the declaration of martial law in Mindanao and suspension of the privilege of the writ of habeas corpus in the region after the attacks of

local terror group Maute in May in Marawi City. It reiterated its finding that the power to determine the scope of territorial application of martial law belongs to the President, and that there is no constitutional provision that such emergency power should be implemented only in the place where actual rebellion exists. The SC added that Congress did not gravely abuse its discretion in not convening jointly upon President Duterte’s issuance of Proclamation 216, placing the entire Mindanao under martial law and suspending the privilege of the writ of habeas corpus. The Court held that Article VII, Section 18

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The number of Supreme Court justices who affirmed the Court’s July decision on legality of martial law in Mindanao of the 1987 Constitution, which allows the President to declare martial law and suspend the writ of habeas corpus only “in case of invasion or rebellion, when public safety requires it,” imposes no duty on Congress to convene. The government had repeatedly said martial law was necessary to quell rebellion since Islamic State of Iraq and Syria-inspired local rebel groups had taken up arms against the Philippine government to secede Mindanao from the republic and to deprive Duterte of his powers and prerogatives. Petitioners filed motions for reconsideration, insisting that there

was no sufficient factual basis to justify martial-law implementation, as several information cited in the proclamation were “false, inaccurate and contrived.” Edcel C.Lagman and two other petitioners—local Mindanao leaders led by Lumad leader Eufemia Campos Cullamat and a group of women from Marawi led by Norkaya Mohamad—claimed in their separate appeals that a key element in act of rebellion—culpable purpose of removing allegiance from the Philippines and preventing the President and legislature from exercising their functions—was not present in the attack of local on May 23 that triggered martial-law proclamation. But the government, through Solicitor General Jose Calida, urged the Court to dismiss the appeals, insisting that the attack of Maute Group was not just an act of terror, but was a clear rebellion and actually part of a plot to establish a Islamic State in Mindanao. Martial law and the suspension of the privilege of the writ of habeas corpus are still in effect in Mindanao.

PSA reports 8% decline in residential projects in Q3 By Cai U. Ordinario

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@cuo_bm

he decrease in residential projects in the third quarter of the year cut the total value of private-sector construction by 6.5 percent in the July-to-September period, according to the Philippine Statistics Authority (PSA). Based on the preliminary data from the PSA, the total value of construction projects was estimated at P72.1 billion in the period, lower than the P77.2 billion recorded during the third quarter of 2016. This was largely due to the 8-percent decline in residential constructions to P36.5 billion this year, from P39.7 billion in 2016. “This [decline in residential construction] was attributed to the decline in construction values of single-type houses [48.3 percent], residential condominiums [29.6 percent], and apartment/accessoria [14.8 percent],” the PSA said. In the third quarter, the total number of construction projects generated from the approved building permits was recorded at 36,076. This number, the PSA said, exhibited an increase of 1.1 percent from the 35,684 construction projects registered during the same quarter in 2016. The number of residentialbuilding constructions, however, declined by 2.5 percent to 26,227, from 26,896 reported during the same period of 2016. The PSA said all types of residential constructions showed decreases in number, except residential condominiums and other types of residential constructions. Data showed the number of apartment/accessoria reached 3,434 (23.4 percent), single-type houses with 22,182 (17.5 percent) and duplex/quadruplex with 510 (11.5 percent). Meanwhile, in terms of value of construction, the share of the top 5 regions amounting to P53.7 Continued on A2

EXPORT ENABLERS Public officials and private-sector industry leaders lead on Tuesday the ceremonial opening of the exhibit Showcase of Export Enablers and Stakeholders on the first day of the National Export Congress 2017 at the Philippine International Convention Center in Pasay City, which has the theme: “Innovate, Collaborate and Export.” Leading the ceremonial rites are (from Left): Bernardo Benedicto, Philippine Chamber of Commerce and Industry (PCCI) assistant treasurer; Bobby Amores, Philfoodex president; George Barcelon, PCCI president; Nora K. Terrado, trade undersecretary; Sergio Ortiz-Luis, Philexport president; Rosvi Gaetos, Department of Trade and Industry, (DTI) assistant secretary; Abdulgani Macatoman, DTI assistant secretary; Emma Mijares, Export Development Council deputy executive director; and Agnes Legaspi, assistant director, Export Management Bureau. ROY DOMINGO

Manila, Washington hold exploratory talks on FTA Continued from A1

Currently, the tariff rate imposed on Japanese automobiles is around 20 percent for vehicles with 3-liter engines and zero for those with bigger engines. Data from the United States Trade Representative (USTR) said American cars are slapped with higher tariffs. The USTR said the Philippines applies a 30-percent tariff on passenger cars; tariffs of 20 percent to 30 percent on vehicles for the transport of goods; and tariffs of 15 percent to 20 percent on vehicles for the transport of persons, depending on vehicle weight. It added that Manila continues to extend zero duty on the importation of capital equipment, spare parts and accessories by motor-vehicle manufacturers and other enterprises registered under the Board of Investments (BOI). “Asean countries and Japan enjoy preferential import tariffs on new vehicle imports under the Asean free-trade agreement and the Japan-Philippines Economic partnership agreement, respectively,” USTR stated in a document. In 2006 the Philippine Institute for Development Studies researchers ,including senior fellow Erlinda M. Medalla said pursuing a United States-Philippines Free Trade

Agreement will only lead to 0.1- percent increase in GDP. The study also stated that a US FTA would reduce poverty incidence, especially in National Capital Region, where industries are based. On the whole, the reduction in poverty, using all three indices, across categories, is 1.1 percent for head count, 1.3 percent for poverty gap and 1.6 percent for poverty severity. The study stated that the FTA talks between the US and the Philippines formally began when Sen. Richard Lugar of the United States Congress presented Senate Bill 2004 on March 11, 2002. The bill authorized the American President to negotiate and conclude an FTA with the Philippines.

WTO representative

President Duterte has appointed a foreign affairs undersecretary as Manila’s permanent representative to the World Trade Organization (WTO), along with two other envoys to Mexico and Cook Islands. The President has named Foreign Affairs Undersecretary Manuel Antonio J. Teehankee as the Philippines’s Permanent Representative to the WTO in Geneva, Switzerland. Teehankee has been tapped as undersecretary for international and economic relations by former Foreign Affairs Secretary Perfecto R. Yasay Jr.

He is also a professor of international law at the Ateneo de Manila University. He is not new to his designation as Manila’s permanent representative to the WTO, as he also held the same post from 2004 to 2011. In the latter part of his previous stint in the WTO, Teehankee chaired the Committee on Trade and Environment from 2007 to 2011. For his diplomatic service to the country, he was bestowed the Distinguished Service Award by the Department of Foreign Affairs (DFA). Before his tenure in the DFA, Teehankee served as justice undersecretary and official at the Office of the Government Corporate Counsel for the Philippine government. His experience in law ranges from arbitral tribunals to dispute settlement in the WTO. Aside from Teehankee, Duterte has also appointed Demetrio R. Tuason as envoy to Mexico, with concurrent jurisdiction over Belize, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, Panama, Dominican Republic and Cuba. Tuason used to chair local firearms manufacturer Arms Corp. of the Philippines, also known as Armscor. The President has also named Jesus S. Domingo as ambassador to Cook Islands, to go along with his concurrent jurisdiction as envoy to New Zealand. Aside from these, he also represents Manila in Fiji, Tonga and Samoa. Cai U. Ordinario & Elijah Felice E. Rosales

www.businessmirror.com.ph

ONE TICKET, ALL FEES, ALL IN: TIEZA-CEBU PAC DEAL EASES AIR TRAVEL

The signing of Tourism Infrastructure and Enterprise Zone Authority (Tieza) Partnership Contracts and TEZ Designation and Registration Agreements were held on Tuesday in a Makati City hotel. Signing the pact, are (from left) lawyer Khristian Alvaera, Cebu Pacific director; lawyer Paterno Mantaring Jr., Cebu Pac vice president of corporate affairs; lawyers Pocholo J. D.Paragas, Tieza COO; and lawyer Joy Bulauitan, Tieza ACOOadministration and finance official. NONIE REYES By Roger Pe Contributor

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usinesswoman Divina Valderrama of Quezon City almost missed her flight when she forgot to pay her travel tax at the airport. She was whiling away her time lounging at a café, engrossed at reading a book, oblivious that what she paid for her Japan trip did not include her travel tax. And she was about to go to the predeparture area. Distraught, she immediately paid her bills and rushed out, almost in panic. You can imagine how she looked. Who wouldn’t? The large throng of people queuing up at the counters would give anyone palpitations, especially if you have a few minutes left before boarding. The hassle she had to go through: She was coming from the second floor with a trolley in tow. The elevator was full and took time to reach each floor. To make matters worse, she was at the opposite end of the airport. Pushing and shoving people out of her way, she was able to squeeze herself among hundreds of passengers who were also as frantic as she was. Alas, she made it in the very nick of time. But it scared the hell out of her wits. Would you like to be in the same situation? Certainly not. You can wise up, and thank the new Tourism Infrastructure and Enterprise Zone Authority (Tieza) and Cebu Pacific tandem for making everything so convenient for travelers like you and me.

The good news

Filipino residents and guests holding a Philippine passport, can now conveniently pay for the Philippine travel tax online at www.cebupacificair.com, instead of lining up at the airport. That saves you getting wrinkles and atrocious varicose veins. It’s that easy and simple to make your traveling worry-free. The signing of memorandum of agreement for the integration of travel-tax payment and exemptions in the booking channels on all Cebu Pacific flights was made on Tuesday at the Makati Diamond Residences, Greenbelt 1, Legaspi Village, Makati City. It was attended by Pocholo Joselito Paragas, general manager and COO of Tieza and lawyer Paterno Mantaring Jr., vice president for corporate affairs at Cebu Pacific. The airline had earlier included payment of airport terminal fee in booking flights, except for Clark. Also exempted from paying terminal fee are infants below 2 years old on the date of travel and guests connecting through Philippine airports except Manila, Cebu and Caticlan (Boracay). The move to integrate travel tax and terminal fees into passenger fares is in line with a directive from Civil Aviation Authority

of the Philippines. “While the total cost paid by passengers who booked flights on Cebu Pacific became slightly higher, this system innovation is total convenience for travelers. They no longer have to line up at the counters. This integration of all fees at the point of booking will make things simpler and easier for the traveling public,” Mantaring said. He noted that the move is very relevant and timely given the need to decongest air terminals and give utmost convenience for growing volume of travelers. Cebu Pacific has an extensive airline network covering over 100 routes across 26 international and 37 domestic destinations, spanning Asia, Australia, the Middle East and the United States. The Department of Tourism (DOT) hailed the move of integrating all airport fees into departing passengers’ airline-ticket payments, saying this will ease the queuing and delays at airport terminals. “This is in pursuant to the 10-point agenda of the President, especially in facilitating processes and systems in the government. Hopefully, the traveling public would appreciate it,” of Tourism Undersecretary Benito C. Bengzon said. The DOT pushed for the removal of the “processing fee” once imposed by the Tieza for the issuance of certificates of travel-tax exemption and reduced travel tax. “These initiatives address the long-standing choke points that beset tourism growth, such as physical airport capacity, travel facilitation and passenger mobility,” according to Tourism Secretary Wanda Corazon T. Teo.

Getting better every time

In May 2008 Cebu Pacific was named as the world’s No. 1 airline in terms of growth. The airline was also ranked fifth in Asia for Budget Airline passengers transported and 23rd in the world. The airline carried a total of almost 5.5 million passengers in 2007, up 57.4 percent from 2006. On July 2008 Cebu Pacific was the first airline to use the new Terminal 3 of the Ninoy Aquino International Airport, with its flight to Caticlan being the first to depart at 5:15 local time. On August 1, 2008, it moved its international operations to the terminal, thus, becoming the first airline to have regular international commercial flights from the new terminal. In August 2009 Cebu Pacific became the first airline in the Philippines to use social media and created a fanpage on Facebook and Twitter. In 2010, Cebu Pacific became the Philippines’s largest airline based on number of passengers flown on domestic and international routes. Continued on A2