media partner of the year
United nations
2015 environmental Media Award leadership award 2008
BusinessMirror
www.businessmirror.com.ph
A broader look at today’s business
n
Saturday, December 31, 2016 Vol. 12 No. 80
2016 ejap journalism awards
business news source of the year
P25.00 nationwide | 8 pages | 7 days a week
PHL banking sector unscathed by global headwinds
R
By Bianca Cuaresma
epeatedly during the year, especially during the several waves of financial-market volatility that were about to hit the local financial sector, Bangko Sentral ng Pilipinas (BSP) officials often stepped in to say there is nothing to worry about “our own banking industry, as it remains strong and prudent in its operations”.
Latest data from the central bank showed local banks’ profitability, indeed, seemed unaffected by the bouts of negative sentiment during the year, as a 16.7-percent overall growth of the industry was seen in terms of net profit in the third quarter of the year, from the P98.4-billion net profit in endSeptember 2015 to P114.8 billion in end-September this year. This is just some P20 billion short of the end-2015 net profit of the banking industry in 2015. Banks’ total assets also grew double digits at 11.7 percent, from P11.5 trillion in end-October in 2015 to P12.9 trillion in October 2016, already surpassing the P12.09-trillion total assets record-
ed in December 2015. Their total loan portfolio grew in total by 16.9 percent, from P6.1 trillion in October 2015 to P7.2 trillion in the same month this year. The industry also showed prudence through their ability to bring down their past due loans to 2.38 percent of their total loan portfolio as of end-October this year, from the 2.51 percent of their total loan books in October 2015. The lenders’ physical network also expanded from 10,615 total offices at the end of the third quarter of 2015 to 11,024 total offices in end-September 2016. The strong numbers of the Philippine banking system lay the groundwork for the central bank
officials’ recurring theme to their statements of a “robust banking sector” that is “resilient to global economic changes” and “supportive of the country’s economic growth momentum”. The BusinessMirror talked to two of the three international major credit watchers on their views of the Philippine banking system and how the industry’s numbers compare with the banking systems in other jurisdictions. In separate exclusive press chats, analysts from both Moody’s Investor Service and Fitch Ratings confirmed the local banking system’s strength in 2016, as compared with similarly rated counterparts, Continued on A2
₧12.9T Philippine banks’ total assets in end-October, up 11.7 percent
‘Betrayal’ at Bureau of Immigration tarnishes Duterte’s anticorruption drive
F MORENTE: “We have already addressed basic weaknesses or chokepoints in the essential services of the Bureau of Immigration.”
By Joel R. San Juan
OLLOWING his appointment in July, Bureau of Immigration (BI) Commissioner Jaime H. Morente vowed to reform the agency by cracking the whip on unscrupulous immigration officers. Five months after, however, the agency is still embroiled in controversies, including one that involves officials appointed by President Duterte. Just this month, two fraternity brothers of Duterte and Secretary Vitaliano N. Aguirre II in the
PESO exchange rates n US 49.8130
Lex Talionis Fratenity—BI deputy commissioners Al C. Argosino and Michael B. Robles—have been recommended relieved from their posts for their reported involvement in the alleged P50-million extortion case involving Chinese casino mogul Jack Lam. This came as a surprise, considering Duterte’s promise to get tough against corrupt government officials. In fact, Aguirre admitted feeling “betrayed” by his two fraternity brothers, saying their involvement in the controversy was contrary to
the order of the President to go after corrupt government officials. Aside from Argosino and Robles, also implicated in the extortion issue were acting BI Intelligence Division chief Charles T. Calima Jr. and technical assistant for intelligence Edward Chan. Both Argosino and Calima were endorsed by Aguirre to Duterte for appointment to their posts. They eventually resigned from their posts before the President could order their dismissal from the BI. See “Betrayal,” A2
Despite President Duterte’s promise to get tough against corrupt government officials, two fraternity brothers of the President and Secretary Vitaliano N. Aguirre II have been implicated in the alleged P50-million extortion case involving Chinese casino mogul Jack Lam. AP/Eugene Hoshiko
n japan 0.4251 n UK 60.8715 n HK 6.4212 n CHINA 7.1612 n singapore 34.3538 n australia 35.7757 n EU 51.8404 n SAUDI arabia 13.2806
Source: BSP (29 December 2016 )
A2 Saturday, December 31, 2016
News
www.businessmirror.com.ph
PHL banking sector unscathed by global headwinds
In this March 17, 2016, file photoa1 (standing, from left), East West Bank Branch Manager Allan Peñalosa, Michael Bautista Continued from of Philrem Services Corp., Philippine Amusement and Gaming Corp. COO Eugene Manalastas, counsel Victor Fernandez and Midas Hotel and Casino Director Bienvenido Santiago take their oaths prior to the start of the Philippine Senate probe into how about $81 million of Bangladesh’s stolen funds were transmitted online to four private accounts at a branch of the Rizal Commercial Banking Corp. The laundering through the Philippines of $81 million stolen by hackers from a US Federal Reserve account is adding to pressures on the Southeast Asian country to fix loopholes in its financial regime. AP/Bullit Marquez Continued from a1
for the year, including the Federal Reserve’s seemingly more hawkish take on interest-rate hikes for next year, as well as political developments in the Philippines and in the United States, where recently elected leaders have been showing unorthodox styles in leadership and policy implementation.
and forecast a smooth-sailing path for financial institutions in the country next year despite foreseen volatility in the international scene. “We think that the Philippine banks managed fairly well against the recent volatilities.… We see that economic backdrop for the Philippine banks is quite stable and resilient,” Fitch Ratings Financial Institutions Director Elaine Koh told the BusinessMirror. Koh forecasts the Philippine banks’ loan portfolio to grow in the high-teens pace next year. “[In 2017] we do think Philippine banks will be able to manage volatility. Clearly, some of the aspects that have affected banks, like the interest rates, are extremely soft, but banks have been able to take advantage,” Moody’s Investors Service Vice President and Senior Analyst for Financial Institutions Alka Anbarasu also told the BusinessMirror.
Bangladesh bank heist
In 2016 one of the biggest issues to shake the Philippine banking sector was the $81-million crossborder bank heist involving the Bangladesh Bank, whose laundered money ended up in the local banking stream through deposits made at Rizal Commercial Banking Corp. (RCBC). Asked if this spells potential threat and negligence on the side of the local banking system, Moody’s’ Anbarasu said they believe the heist is a “one-off” incident, as Philippine banks are subject to one of the most stringent regulations in the world implemented by the Bangko Sentral ng Pilipinas (BSP). Fitch’s Koh, on the other hand, said the recent incident continues to highlight some areas of weakness, but added there has been “sufficient attention” being paid to the issue, especially by the central
Pockets of risks
While the two analysts from the international ratings agencies mirrored the confidence shown by local officials, they warned of pockets of risks that may threaten certain sectors of the local banking industry going forward in 2017. Among the sectors most monitored for financial institutions in the Philippines is their exposure to the real-estate sector, as prices continue to rise, fueling some concerns of a potential asset bubble in the country. Anbarasu said they are watching the banks’ exposure to real estate, particularly, as it comprises a large bulk of the lenders’ total loan portfolio in the country, and could spell problems for banks, should property prices start to correct or soften, and should supply outpace demand in the industry. Fitch’s Koh also admitted they are watching the banks’ exposure to the property sector, but expressed more optimism on the health of the real-estate loans and the strong demand to back up the supply. Koh also said potential unforeseen deterioration of remittance inflows and sudden changes in the business-process outsourcing (BPO) flows could spell uncertainty and volatility for banks, but this is not their baseline scenario. However, Philippine banks will most likely be resilient to the bigger waves of investor concerns
Betrayal…
Credit watchers said the Bangko Sentral ng Pilipinas, under the leadership of Governor Amando M. Tetangco Jr., did well to take advantage of the banks’ resilience to boost its strength and implement prudential measures to shield the industry from potential risks down the line. Tetangco’s term as governor ends in mid-2017. Dimas Ardian/Bloomberg News
bank and the legislative branch. She also said Fitch is currently tracking the progress on the legislative side of the issue to prevent local financial institutions from being used in money-laundering schemes.
Tetangco’s term ends
Both credit watchers also said the BSP, under the leadership of the central bank Governor Amando M. Tetangco Jr., did well to take advantage of the banks’ resilience to boost its strength and implement prudential measures to shield the industry from potential risks down the line. “We think of the BSP as an institution with a very high credibility,” Anbarasu said. “The BSP has shown a fairly prudent approach to bank regulation and we expect that to continue…. The governor has done commendable work in strengthening banks and we see this as something that will remain for the longer term,” Koh also said. Asked if Tetangco’s end of term in the middle of 2017 is something they see as a risk to the strength of the local banking system, Fitch’s Koh said they are still monitoring developments, although there is always a degree of uncertainty in transitions.
Continued from a1
Aguirre has also issued a lookout bulletin order (LBO) against these resigned BI officials pending the result of the probe being conducted by the National Bureau of Investigation (NBI) and the BI on the extortion case. Lam has been blacklisted over the illegal casino operation at the Fontana Leisure Parks and Casino in Clark, Pampanga, and was ordered arrested by Duterte for alleged bribery, economic sabotage and harboring illegal aliens. The issue has overshadowed the efforts of the current BI leadership to address corruption in the bureau, as well as improve its service efficiency. Only this year, Morente announced the implementation of service efficiency-strengthening measures by reshuffling more than 400 immigration officers at the Ninoy Aquino International Airport (Naia). The reshuffle of the BI personnel to any one of the three
terminals of the Naia started in November. “We have already addressed basic weaknesses or chokepoints in the essential services of the Bureau of Immigration. We are now embarking on a service-efficiency program, especially in the light of the holiday season,” Morente explained. He added that the assignments of immigration officers at the Naia will be changed every three to four months, or as the need arises. “This rotation policy intends to provide new challenges to our personnel, as well as prevent fraternization among airport personnel, which has been pinpointed as a major source of corruption, not only in our bureau, but in other government agencies as well,” Morente pointed out. He also revealed that aside from immigration officers, BI intelligence agents assigned at the Naia will also be reshuffled in line with this policy.
Editor: Jun Lomibao | mirror_sports@yahoo.com.ph
Sports
BusinessMirror
Saturday, December 31, 2016 A3
‘UTILITIES KILL RINKS’ By Wilson Ring The Associated Press
W
OODSTOCK, Vermont—A small community skating rink that was once in danger of folding is working on a long-term plan to eliminate its biggest single expense—its energy bill—by becoming what its leaders believe would be the country’s first with no costs for electricity or heating fuel. The plan includes upgrading the existing equipment at Woodstock’s Union Arena for efficiency, finding ways to reuse some of the heat generated by the power-sucking compressors used to make ice and, finally, buying solar panels that will be erected elsewhere. While the long-term plan to eliminate the power bill, making the rink “net zero,” is in its early phases, the rink’s electricity consumption from early November to early December was down 12.5 percent from the same period a year ago, said Harold Mayhew, the president of the
RECORD TIME
Supermaxi Perpetual Loyal takes line honors in the Sydney-to-Hobart yacht race, with its winning time nearly five hours faster than the previous record. Skippered by Anthony Bell, Perpetual Loyal crosses the finish line at Constitution Dock in Hobart at around 2:30 a.m. local time on Wednesday to complete the 630-nautical-mile race in one day, 13 hours, 31 minutes and 20 seconds. That shatters the race record, set in 2012 by rival supermaxi Wild Oats XI, by four hours, 51 minutes and 52 seconds. AP
BABY FALCON SHINES A
DAMSON University guard Encho Serrano delivered impressive numbers after the first round of the University Athletic Association of the Philippines Season 79 juniors basketball tournament. The Baby Falcons completed a sevengame sweep—thanks to Serrano, who currently leads with 73.4286 statistical points (SPs), based on the figures released recently by the league’s statisticians from Imperium Technology. Making a statement in the Most Valuable Player chase, the 5-foot-11 Serrano is second in the scoring department, with 19.3 points per game, while also averaging 8.1 rebounds
Karatekas focus on Tokyo ‘20
N
and 1.9 assists so far this season. Serrano is hoping to become the second straight guard after last season’s winner Aljun Melecio of De La Salle-Zobel to hoist the league’s highest individual award. Adamson University is also coming off a successful campaign in the Philippine Secondary Schools Basketball Championship after dethroning Chiang Kai Shek College. Ateneo’s SJ Belangel, meanwhile, trailed Serrano with 70.5714 SPs in second place, while Juan Gomez de Liaño of the University of the Philippines Integrated School ran third with 69.2857 SPs. Rounding up the top 5 National
ATIONAL athletes of the Philippine Karatedo Federation (PKF) has recently completed a 16-day training camp in Holland, hoping the exercise would be a springboard to the organization’s bid to qualify local bets to the Tokyo 2020 Olympics. “We plan to send more athletes to training camps abroad. The PFK wants to tighten up on its preparations for the Tokyo Games,” PKF SecretaryGeneral Raymund Lee Reyes told the BusinessMirror. “But we must first hurdle our first test—next year’s
University’s John Lloyd Clemente (64.5714) and Far Eastern University-Diliman’s Kenji Roman (60.1429). Belangel is one of only two players in the league who are recording a doubledouble performance with 15.7 points and 10 rebounds per game for the Blue Eaglets, who finished fourth in the first round with a 4-3 win-loss record. Gomez de Liaño, younger brother of Fighting Maroons stalwart Javi, led the way in scoring with 20 points per contest, while Clemente was No. 3 with 16 points per game. Roman led the league in rebounds with 11.6 boards per outing. The reigning champion Bullpups wound
Southeast Asian Games.” The International Olympic Committee has finally approved karate’s inclusion—as well as skateboarding, sports climbing, surfing and baseball/ softball—as a medal sport in the Tokyo Olympics. The PKF’s Iranian head coach, Ali Parvinfar, led the eight-member delegation in the Holland camp, where Filipino karatekas sparred with their counterparts from Iran, Belgium and France. “We have also set our goal for 2017, especially
up second in the first round with a 6-1 card, while the Baby Tamaraws have five victories in seven matches in third spot. The Junior Maroons are currently tied at fifth place with the Junior Archers at 2-5. Second round action resumes on January 14.
» ADAMSON University guard Encho Serrano is dishing out Most Valuable Player numbers.
in the Southeast Asian Games [in Malaysia]. We’ll take it one step at a time,” Reyes said. Filipino karatekas won one gold, one silver and one bronze medals in the Myanmar 2013 Games. Singapore did not include karatedo in its program when it hosted the Games last year.
Ramon Rafael Bonilla
NEW DELIVERY
The Turf Company delivers another fleet of equipment to Santa Elena Golf and Country Club, including new models of Workman utility vehicles and mowers for turf maintenance. Shown in the photo are (from left) Renato Candilario, chief mechanic of Pacific Links; Mario Lopez, president and COO of the Turf Company; Tim Walker, vice president for golf developments at Santa Elena; and Ernie Mozo, sales manager of The Turf Company.
Union Arena Board of directors and an architect who specializes in skating rinks. “If you can make a hockey rink a net zero building, you can make anything net zero,” said Mayhew, who designed the rink at Maine’s Bowdoin College, which opened in 2009 and became the nation’s first hockey rink to be certified by The Leadership in Energy and Environmental Design program, or LEED, that rates buildings for their energy efficiency. Energy costs are typically the largest bills for skating rinks, which use huge amounts of electricity to run the equipment that makes and maintains the ice used by hockey players, figure skaters and others, such as curlers . “Utilities is what kills the rinks,” said Paul Moore, the chairman of the Board of Governors for Falmouth Youth Hockey in Massachusetts and the coach of the Falmouth High School hockey team. He has worked to reduce his facility’s electric bill by installing 4,400 solar panels on the roof and in a nearby parking lot that produces just short of one megawatt of electricity, enough for about 164 homes. Through a deal with a utility, the Falmouth facility is guaranteed for 10 years an $85,000-a-year savings on its electric bill, but it’s not down to zero. “This has been huge for us,” Moore said. “We’re a nonprofit. The youth hockey organization owns the rink, so this allows us to continue our mission statement of keeping tuition low and keeping ice rates low.” Across the country, rinks large and small are always looking for ways to save energy and therefore money, said Kevin
McLaughlin, the senior director of hockey development at USA Hockey, the organization that oversees most youth hockey programs in the country. For example, he said, at the University of Colorado, excess heat from the skating rink’s ice system is used to heat the water in the swimming pool. National Hockey League teams are also working to save energy, and the National Hockey League’s (NHL) Greener Rinks initiative is sharing best practices with the small community rinks. “Community rinks are the front lines of our game,” said Omar Mitchell, NHL vice president for corporate and social responsibility. Mayhew, a Woodstock resident who designed the original rink that opened in 2003 and became involved again several years ago when the energy bill had helped push the rink to the brink of closing. Energy costs at about $140,000 a year were about a third of the rink’s total budget. “They were having such a hard time keeping the doors open they couldn’t afford to do any of the work to cut down on energy consumption,” said Mayhew, who joined the board of directors in 2013 and later became president. The first goal was to raise enough money to pay off the rink’s debts. Then the rink embarked on its four-tier plan to eventually reach net zero. Mayhew designs rinks in New England, but he works with people who know the industry across North America and beyond. He says no one he has spoken with is aware of any other facility working to reduce its energy bill to zero.
A4
AseanSaturday
Saturday, December 31, 2016
BusinessMirror
www.businessmirror.com.ph
Southeast Asia’s best stock seen extending rally in 2017
P
T Adaro Energy, Southeast Asia’s best-performing stock this year, is expected by analysts to extend gains in 2017 as it benefits from rising coal prices and cost-cutting initiatives.
costs by 36 percent in five years, said Sandro Sirait, an analyst at Trimegah Securities in Jakarta. Adaro has managed to lower its stripping ratio, the volume of soil waste to be handled to extract a ton of coal, without affecting its reserves due to the size of its pit, Sirait said. To further reduce its costs, Adaro also contracted its own unit to do more of the mining work rather than outsourcing the job, he said.
Share boost
Coal mining at Raspadsky open-pit mine Bloomberg
The coal miner’s measures to reduce expenses resulted in an earnings before interest, taxes, depreciation and amortization margin of 36.2 percent in the third quarter, the largest among Indonesia’s five biggest listed coal miners, and the highest quarterly reading in three years, according to data compiled by Bloomberg. Adaro’s shares more than tripled in 2016, also buoyed by rebounding commodity prices, and analysts see the stock advancing another 8.1 percent in the next 12 months to the highest since May 2012. Adaro is “the most cost-effi-
cient coal producer and the second cheapest in terms of enterprise value over Ebitda,” said James Wahyudi, an analyst at PT Sinarmas Sekuritas in Jakarta. “We estimated its revenue to increase by 47 percent in 2017 and net profit to rise by 27 percent.” The country’s second-largest coal miner by output is expected to report a 32-percent increase in net income next year as its revenues climb a projected 15 percent, according to estimates from analysts surveyed by Bloomberg. Adaro has been a “consistent long-term player” as it decreased its cash
Adaro shares surged 228 percent this year, almost three times as much as the equities of AirAsia Bhd., which had the second-largest rally on the MSCI South East Asia Index. Erindra Krisnawan, a Jakarta-based analyst at CIMB Securities whose recommendation on the stock produced the best return among analysts surveyed by Bloomberg, predicts the stock price could rise to 1,950 rupiah, from 1,690 rupiah on Friday. Rising commodity prices and expectations for higher demand has boosted the Jakarta Stock Exchange Mining Index 70 percent this year, making it the best performer among nine industry groups in the benchmark measure. Some investors are also betting that US President-elect Donald Trump’s plans to boost infrastructure spending will result in even more demand for commodities and energy.
Rally overdone
Adaro shares traded unchanged
at 1,690 rupiah at 10:15 a.m. local time in Jakarta after gaining as much as 0.9 percent earlier. Despite this year’s rally, Adaro trades at 11.4 times of its 12-month projected earnings, near its three-year average of 11.1 times. However, Indra Mawira, a fund manager at Panin Asset Management in Jakarta, said he sees more downside risk for coal stocks. “The rally in coal stocks might be overdone as the recent uptrend in coal prices was driven by the intervention of the Chinese government instead of fundamentals,” Mawira said. “I don’t think it can be sustained. We see the new equilibrium for coal price of around $60 to $70 per ton.” The coal price at Australia’s port of Newcastle climbed 2.5 percent on December 28 to $91.75 per ton, according to data compiled by Bloomberg, taking its yearto-date advance to 102 percent. A d a ro Ene r g y Sp ok e s m a n Febrianti Nadira said in an email the company will provide guidance for 2017 in early February and will continue to look at efficiency improvements. “We are optimistic with the prospect from Indonesia and other Southeast Asian countries as these countries will continue to depend on coal to fuel their surging energy needs to achieve stronger economic growth,” Nadira wrote. Adaro’s largest shareholder, PT Adaro Strategic Investments with a 43.9-percent stake, could not be reached for comment. Bloomberg News
In this image made from video, Thailand’s Crown Prince Maha Vajiralongkorn participates in a Buddhist ceremony to mark 50 days since the death of his father at the Grand Palace in Bangkok on December 1. Vajiralongkorn’s father, the much-revered Bhumibol Adulyadej, who took the throne in 1946, died on October 13 at age 88 after many years of ill health. Thai TV Pool via AP
Thailand’s parliament grants king power to name Buddhist patriarch
B
ANGKOK— Thailand’s military-appointed parliament has granted the king absolute power in naming a supreme patriarch, the top ecclesiastical position of Thai Buddhism. The amendment approved on Thursday means the king can eliminate the traditional vote of the senior monks’ body, the Supreme Sangha Council. The power struggle over leadership of the Buddhist hierarchy in Thailand centers around 91-year-old Somdet Phra Maha
Nobel laureates criticize Aung San Suu Kyi over displaced Rohingya
U
Earthquake survivors rest in a tent at a temporary shelter in Pidie, Aceh province, Indonesia, on December 10. Tens of thousands of people have been displaced by the powerful earthquake that hit Indonesia’s Aceh province, authorities said on Saturday, as the government and aid agencies pooled efforts to meet the basic survival needs of shaken communities. AP/Trisnadi
6.2-magnitude earthquake shakes eastern Indonesia
T
OL O TA NG G A , I ndone s i a — A 6 . 2- m a g n it u d e e a r t hq u a k e o n Fr i d ay hit a region in the eastern part of Indonesia, the US Geological Survey reported. The earthquake hit about 6:30 a.m. in the Sumbawa region, the agency said. The epicenter was about 33 kilometers south of the village of Tolotangga, which is 1,350 kilometers east of the nation’s capital, Jakarta. The earthquake was about 72 kilometers deep, the agency said. I n a s t a t e m e nt , I n d o n e sia’s National Disaster Mitigation Agency said the earthquake was also felt in the neighboring province of East Nusa Tenggara and the tourist island of Bali. The earthquake caused many
residents in the areas hit to pour out from their houses, the agency said. But it added that there were no immediate reports of damages or casualties. No tsunami warning has been issued, according to the US Geological Survey. On December 7 Indonesia’s Aceh province was hit by a 6. 5 -m ag n it ude qu a ke t h at killed more than 100 people. T he world ’s l a rgest a rc h ipelago, Indonesia is prone to earthquakes due to its location on the Pacific “R ing of Fire”, an arc of volcanoes and fault lines in the Pacif ic Basin. A 2004 quake and tsunami killed a total of 230,000 people in a dozen countries, most of them in Aceh. AP
Police officers help clear rubble at the ruin of a mosque collapsed in Wednesday’s earthquake in Tringgading, Aceh province, Indonesia, on December 10.
R atchamangalacharn, who has been accused of corruption in a dispute that mixes politics and religion. He has ties to the Dhammakaya sect, which has a reputation for encouraging materialism and showiness and is unpopular with mainstream Budd h i st s. Phra R atchamangalacharn was nominated by the council to be the supreme patriarch in January but was never formally endorsed by the prime minister. He is now unlikely to get the top job. AP
NITED NATIONS—Nearly a dozen fellow Nobel peace laureates on T hursday criticized Myanmar leader Aung San Suu Kyi, saying she has failed to ensure equal rights for the minor it y Rohing ya people in R akhine state, where the group says more than 30,000 people have been displaced amid an unfolding humanitarian crisis. A military offensive in recent months by the Myanmar army has led to the deaths of hundreds of Rohingya, the burning of homes, and the raping of women, as well as arbitrary detentions, according to an open letter to the UN Security Council from a group of 23 activists, including Nobel laureates and current and former political and business leaders. “Access for humanitarian aid organizations has been almost completely denied, creating an appalling humanitarian crisis in an area already extremely poor,” the letter reads. “Thousands have fled to neighboring Bangladesh, only to be sent back.” Myanmar’s UN mission was closed on Thursday and an e-mail message seeking a response was not immediately returned. Earlier this month, an Amnesty International report claimed that actions by Myanmar’s militar y in R akhine may constitute crimes against humanity. Myanmar has come under heavy criticism for its army’s forceful treatment of the Rohingya, and international human-rights groups, including Amnesty have accused the militar y of mass murder, looting and rape. In the open letter, the group asks that the UN encourage the Myanmar gover nment to lift restrictions on humanitarian aid, grant access to journalists and human-rights monitors and establish an independent, international inquiry into the situation in Rakhine state. The group also asks that the Security Council make the Rohingya’s plight a matter of urgency and that the UN secretary-general visit
Myanmar in the coming weeks. “If we fail to take action, people may starve to death if they are not killed with bullets, and we may end up being the passive observers of crimes against humanity,” the letter says. T he m i l it a r y sweeps were sparked by an October 9 attack on police outposts in Rakhine state that killed nine officers. Located in Myanmar’s west, Rakhine has long been home to simmering tensions between the Muslim ethnic Rohingya minority and the country’s Buddhist majority population. The last major outbreak of violence in 2012 left hundreds dead and drove 140,000 people into internal displacement camps. Nobel peace laureates who signed the letter include Jose Ramos-Horta, former president of East Timor; South African social rights activist Archbishop Desmond Tutu; and Malala Yousafzai, the Pakistani advocate for female education and youngest-ever w inner of t he prize. Others who signed include former Prime Minister of Italy Romano Prodi and British business leader Sir Richard Branson. San Suu Kyi won the 1991 Nobel peace prize. AP
Myanmar Foreign Minister Aung San Suu Kyi leaves after a meeting with foreign ministers from the Association of Southeast Asian Nations on December 19 in Yangon, Myanmar. Suu Kyi has met with regional foreign ministers to tackle growing international criticism of her army’s forceful treatment of the country’s Muslim Rohingya minority, which some critics say constitutes crimes against humanity. AP/Thein Zaw
www.businessmirror.com.ph
Banking&Finance BusinessMirror
Crying need of the homeless free enterprise Zoilo P. Dejaresco III
B
eing designated as “housing czar” presents Cabinet Secretary Leoncio B. Evasco Jr. both the opportunity and the burden of addressing the crying need of millions of homeless Filipinos. There are immediate, as well as long-term, challenges. For instance, there are the thousands of disaster victims of Supertyphoon Yolanda and the 7.2 killer quake in Bohol who to this day, three years after, still have not been given the housing aid promised by government no matter the billions of pesos imputed in the national budget and millions more from donors. Department of Social Welfare and Development (DSWD) Secretary Judy M. Taguiwalo lamented that, while the government had already provided 1 million housing units for the Yolanda victims, some 200,000 more, mostly from Leyte (100,000) and Samar (80,000), remain homeless. Akin to Haiti victims, some have become. An old, odd ruling seems to be the culprit. Disqualified from government housing aid (emergency shelter assistance) are those families earning more than P15,000 and those living within danger zones. The income of P15,000 for a family of five is too small to construct a new house without financing and, second, it is the government’s duty to relocate those in danger zones to the acres of unused, unproductive government land. This neglect is like being “Yolandad” twice over. In Bohol the earthquake in 2013 recorded 8,083 totally damaged houses and 34,688 partially damaged ones. Today, after the P2.3-billion Bohol Earthquake Assistance, or BEA, shall have been fully expended, a vast number of the victims do not have homes yet. The BEA was mainly spent for cold, distant infrastructure projects, but what about the throbbing misery of thousands of human beings left without shelter? Indeed, it is true that in the aftermath of climate change, it is the poor who suffer the most from the environmentally reckless acts of the rich, because the poor are in the least position to help themselves financially after a disaster. Where is our heart as a people? Then, Evasco has to grapple with the issue of 5.7 million low-cost housing backlog in the country. It is said the Philippines has to build 2,600 houses daily to close the housing gap. We are not anywhere near that number and the population is growing. T he gover nment need s to g ive more t a x bre a k s to t hose hou s i ng de ve lop e r s i nvolve d i n low cost hou si ng projec t s to ent hu se t he m to z e ro i n more on t he i r t a rget m a rk et . Pag-ibig Fund, or the Home Development Mutual Fund, is also in a position to help accelerate this funding mechanism for low-cost housing. After all, it reported P20 billion in net income in 2015 and set to declare P14 billion as dividends to shareholders. To our mind, Pag-ibig, as a government-ow ned cor poration, is not meant first to be a cash cow for the government to fund the nation’s budget. It was created primarily to help alleviate the plight
of the 5.7 million homeless families in our midst. It can consider, for instance, increasing the threshold limit at the present P17,500 -per-month income fa m i l ies a s el ig ible for funding and the borrow ing cap of P750,000 in recognition of the rising cost of construction due to inf lation. Moreover, it can lower its 4-percent to 5-percent interest charge (perhaps equal to the savings rate given by banks to depositors), inc re a s e t he 10 -ye a r re p ay me nt schedule to 15 years and lessen the stringent requirements for home loan applications. Given Pag-ibig’s financial performance, it can easily access cheaper, longer-term credits in the financial markets to implement this policy change. Why is it not doing it? Pag-ibig’s societal role is to provide as many low-cost houses to as many Filipinos as it can and not to be the best financially performing government-owned or -controlled corporation (GOCC). We believe its financial footings can allow for these moves. Finally, there is the issue of 1.5 million illegal settlers all over the country. They are not merely an eyesore whose abode we cover with billboards whenever foreign celebrities visit the Philippines. They are human beings living in inhuman conditions, in a veritable den of poverty, lawlessness and despair. The government has thousands of hectares of land where they may be relocated. And if the government can provide livelihood assistance to homecoming overseas Filipino workers who are better off financially, why cannot it provide the same to the poorest of the poor as the slum dwellers? The problem is another agency called the National Housing Authority (NHA), which can do land banking and can identify free government lots has plans only for squatters in Metro Manila and its periphery. Statistics show that 90 percent of the relocated illegal settlers are in Metro Manila and the surrounding provinces of Cavite, Bulacan, Rizal and Laguna. Is this Imperial Manila, again? There are three other agencies under Evasco that can further expand the housing program in the countr y. T here is t he Nat iona l Home Mortgage and Finance Corp. that lends directly to financia l institutions, cooperatives and developers for low-cost housing and can securitize ( buy the housinginstallment receivables from the same) to increase their capacity to relend. T here is the Home Guaranty Cor p. that issues partial guarantees to financial institutions that engage in low-cost housing. There is the Housing and Land Use Regulator y Board, which has the power to allocate land and approve land planning so that it redounds to the greatest benefit of the disadvantaged sector. Given Evasco’s earlier priestly leanings and a leftist’s bias for the poor and the dispossessed, we hope he will use these arsenals of power and finance to assist those who need help the most. Bingo Dejaresco, a former banker, is a financial consultant, media practitioner and political strategist. He is a life member of Finex but his views here are his personally and do not necessarily ref lect those of Finex. dejarescobingo@yahoo.com.
Case clippings
SEARCH WARRANTS–endorsement by assistants
Nothing in the law prohibits the heads of the National Bureau of Investigation, the Philippine National Police and the Anti-Crime Task Force from delegating their ministerial duty of endorsing an application for search warrant to their assistant heads. Under the Administrative Code of 1987, an assistant head or other subordinate in every bureau may perform such duties as may be specified by the superior, as long as it is not inconsistent with law.
Tomas v CIDG
GR 208090
09 Nov 2016
Peralta, J
Saturday, December 31, 2016
A5
Aboitiz units acquire First-Agro Industrial Rural Bank Inc.
U
nion Properties Inc. (UPI) and City Savings Bank Inc. (CitySavings) have obtained Monetary Board (MB) approval to finalize their acquisition of Bogobased lender First-Agro Industrial Rural Bank Inc. (FairBank).
UPI and CitySavings, both wholly owned subsidiaries of Union Bank of the Philippines (UBP), announced the MB approval to proceed with the joint acquisition of a majority stake in FairBank.
The transaction also marked the financial conglomerate’s foray into rural and microfinance banking. “We are thrilled about this acquisition because it serves as a first step in serving our unbanked
countrymen,” said Eugene S. Acevedo, CitySavings chairman of the board and UnionBank senior executive vice president. He added, “We are grateful to the founding owners of FairBank for trusting us to continue their microfinance mission.” CitySavings is the thrift-banking arm of UBP, a universal lender, while UPI is engaged in managing the buildings and other real properties either wholly or partially owned by UBP. After the acquisition, FairBank will remain structurally separate and will maintain and keep its company name and organization, as well as its brand identity as a “dependable partner for a brighter future”.
Established in 1999, FairBank has more than 200 employees and total resources of more than P360 million. It has more than 10,000 borrowers and a depositors’ base of over 20,000. “FairBank, from its conception, has always been aimed at serving the microfinance community. With this partnership, we hope to further the reach of our services to the under-served communities around the Visayas and beyond. This partnership shall strengthen our tenacity and open new possibilities,” said Dinah Fernan-Verallo, president, CEO and chairman of FairBank. She added, “Overall, we are elated over this development and we look forward to what is to come.”
‘Global Finance’ names BDO Private Bank as one of world’s best
G
lobal Finance magazine has named BDO Private Bank (BDOPB) one of the world’s best private banks for continuously providing the diverse investment and financial needs of its high net-worth clients. BDOPB is a whol ly ow ned subsidiary of BDO Unibank, the country’s largest bank to date. “With unprecedented wealth accruing to individuals worldwide,
the number of millionaires and billionaires is growing in every region of the world,” Joseph D. Giarraputo, publisher and editorial director of Global Finance, said in a statement. “Although often viewed as a monolithic group, in truth the wealthy have diverse needs— whether preser ving inherited wealth or managing riches gained through entrepreneurship.” He noted t hat t he annu a l
World ’s B e st P r iv ate B a n k s Awards help high net-worth investors choose wisely among the myriad private banks with different strengths in wealth advisory services, to identify the firms, most likely, to understand their individual needs and deliver on the highest level of client service. Global Finance said it selected the winners making use of entry submissions, market research,
input from industry analysts and executives, and other users of private-banking services. T he w inners w il l officia l ly be honored dur ing the dinner ceremony for the second annua l World ’s Best Pr ivate Banks Awards to be held in New York on Febr uar y 7, 2017. A f u l l report on the selections had been published in the December issue of Global Finance.
China Bank and China Bank Savings ATM cards now EMV-ready
C
Lawyer Eduardo M. Pangan (right) takes his oath of office before Finance Secretary Carlos G. Dominguez III as the newest member of the Philippine Deposit Insurance Corp.’s board of directors.
PDIC welcomes new director T he Philippine Deposit Insurance Corp. (PDIC) has welcomed lawyer Eduardo M. Pangan, newly appointed member of the PDIC board of directors, representing the private pector. As a partner at the Mendoza & Pangan law firm, Pangan brings with him more than two decades of experience in corporate law, negot i at i ng a nd st r uc t u r i ng acquisitions and divestments,
investments and joint ventures in various industries. The new PDIC director graduated from the Ateneo Law School in 1991 and was admitted to the Philippine Bar in 1992. He is a member of the Alliance of M&A Advisors. Pangan joins Rogelio Guadalquiver as newly appointed m e m b e r o f t h e PDIC b o a rd of d irectors. Under Republic Act 10846, the amended PDIC
Charter that took effect on June 11, 2016, PDIC’s board composition increased from five to seven, with the addition of two more directors from the private sector. PDIC is headed by the secretary of the Department of Finance as ex-officio chairman. The PDIC President serves as board vice chairman and the Bangko Sentral ng Pilipinas Governor is ex-officio member of the board.
hina Banking Corp. (China Bank), in compliance with the Bangko Sentral ng Pilipinas (BSP), has adapted the most recent advancement in automated banking to combat fraud and protect its customers’ payment data. Since August 1, China Bank clients who open an ATM savings account have been receiving the new China Bank ATM card equipped with the EMV chip. Clients who already have a China Bank ATM card will only need to go to their branch of account to change their old card to the new EMV card for free. Customers have until January 31, 2017, to go to their branch of account to claim their new EMV-enabled ATM card. By February 1, 2017, the old cards will be deactivated. Prior to February 1, however, using the new EMV-enabled card will automatically deactivate the old card. In August 2013 the BSP Monetary Board approved an enhanced Information Technology Risk Management framework that requires all Philippine banks to shift to EMV. China Bank is one of the first banks to be EMV-ready. EMV stands for Europay, MasterCard and Visa—the consortium that spearheaded the production of the chip that generates a unique number for each transaction, making it extremely difficult to use a cloned card fraudulently on a card-present transaction. The chip follows strong encryption standards that cannot be copied, which may happen with cards that have the magnetic stripe only.
Philexport pushes export industry-reform agenda
E
xporters are pinning high hopes on robust economic growth and government’s programs to boost exports to fuel the recovery of the sector, as they continue pushing the industry-reform agenda. “From many indications, we would like to believe that this is, indeed, the golden age of MSMEs [micro, small and medium enterprises],” Philippine Exporters Confederation Inc. (Philexport) President Sergio R. Ortiz Luis Jr said. Ortiz Luis said his group has been advocating and promoting for a strong and sustainable MSME sector “in a way that they can effectively and efficiently participate in the regional and global production networks and compete with the rest of the world.” With the right environment, he expects the MSMEs’share in the country’s employment and
GDP to increase from its current contribution of 35 percent to 40 percent or even higher. In 2017 Ortiz Luis said the Philexport and the Export Development Council (EDC) will push the industr y-reform agenda that include maximization of the benefits of free-trade agreements (FTAs), intensified campaign against corruption and facilitation of infrastructure development, and capacity building for MSME and institutional disaster resilience. He said these trade agreements include the Regional Comprehensive Economic Partnership and the Philippine-European Free-Trade Agreement. Ortiz Luis also looked forward to the full utilization of the Brunei-Indonesia-MalaysiaPhilippines East Asean Growth Area, an initiative supported by Philexport.
“Breakthroughs in this front also lie on the successful removal of nontariff barriers that prevent us from entering new or expanding our markets,” he noted. The export group chief added they will continue advocating for the implementation of existing labor laws to ensure the workers’ security of tenure as a middle ground to stopping illegal hiring practice, and the passage of the Comprehensive Tax Reform Act, Ease of Doing Business Act and amendments in the implementing rules and regulation of the Magna Carta for MSMEs, among others. Further, Ortiz Luis hopes that the country’s latest export performance will signal the start of the export recovery even amid slower global economic growth. He noted the country’s GDP that surged 7.1 percent in the third quarter, topping
economic growths of China, Vietnam, Indonesia and Malaysia, during the period. Merchandise exports in October rose 3.7 percent for the second consecutive month after the 17-month decline. He also cited the Department of Trade and Industry’s (DTI) thrust to further strengthen the manufacturing sector that is now growing 7 percent to 8 percent compared to 3 percent to 4 percent in the past. Ortiz Luis said the DTI also announced it would set aside an initial P1 billion in 2017 for lending to micro and small firms to “discourage borrowers from turning to usurious lenders.” The funds, which will come from the Office of the President, are targeted to reach P18 billion, with each of the region allocated P1 billion.
A6
Saturday, December 31, 2016
briefs
At least 6 killed in mine collapse in eastern India
PATNA, India—An official says at least six workers have been killed and many others remain trapped in a coal mine in the eastern Indian state of Jharkhand. S.K. Singh, the general manager of the Rajmahal Open Cast Mines, said on Friday that the mine collapse took place late on Thursday and that heavy smog prevented rescue workers from entering the mine until early on Friday morning. Indian media reports say that as many as 40 workers could be trapped in the mine but Singh said that only 10 mining vehicles entered the mine and company safety rules call for only for one worker per vehicle. AP
How many women can have baby in your city? South Korea shuts site SEOUL, South Korea—South Korea’s government has closed its web site that drew fury for showing the number of women in childbearing age by each city district and region. The Ministry of the Interior’s web site featuring the pink birth map remained closed on Friday, a day after its launch, showing instead a notice that the site is undergoing corrections. The web site went offline after just a few hours following criticism the government is trying to shame women for not having babies. The site also featured a ranking of regions by the number of women aged 15 to 49. The government had touted it as a tool to increase the public’s understanding of the country’s low birth rate. South Korea is struggling to boost its rock bottom birth rate, one of the lowest among rich countries. AP
Argentina court reopens probe of ex-president in bomb case
BUENOS AIRES, Argentina—An Argentine court on Thursday ordered a renewed investigation into a prosecutor’s accusation that former President Cristina Fernandez covered up the alleged involvement of Iranians in a 1994 attack on a Jewish community center. The bombing of the Argentine Israelite Mutual Association center in Buenos Aires killed 85 people and wounded hundreds. Iran has denied any connection with the attack and declined to turn over suspects in the case. Argentina’s official Center of Judicial Information said the country’s top criminal tribunal had accepted a request by a coalition of Jewish associations to reexamine the charge made by prosecutor Alberto Nisman on January 14, against Fernandez, Foreign Minister Hector Timerman and other officials in her government. He alleged Fernandez reached a secret deal with Iran’s government to hide the role of several Iranian officials suspected in the bombing. AP
The World BusinessMirror
Cease-fire in war-ravaged Syria; peace talks to follow
B
EIRUT—A cease-fire brokered by Russia and Turkey went into effect in war-ravaged Syria at midnight on Thursday, a potential breakthrough in the six years of fighting that have left more than a quarter-million people dead and triggered a refugee crisis across Europe. If it holds, the truce between the Syrian government and the country’s mainstream rebel forces will be followed by peace talks next month in Kazakhstan, Russian President Vladimir Putin said in announcing the agreement. He described it, however, as “quite fragile” and requiring “special attention and patience.” T he f irst ha lf-hour of the cease-fire was one of “comprehensive calm,” said Rami Abdurrahman, head of the Syrian Observatory for Human Rights. He said that before the truce came into force, the government was bombing several areas, including the province of Aleppo and suburbs of the capital, Damascus. The truce had the backing of both Russia, Syria’s chief battlefield ally, and Turkey, which has been supporting the rebels. Russia said the deal was signed by seven of Syria’s major rebel factions, though none of them immediately confirmed it, and one of them denied signing. Several previous cease-fires in the Syrian civil war all collapsed, some of them in a matter of days. And this latest agreement, like previous ones, does not include extremist factions, such as the Islamic State (IS) group and alQaeda’s branch in Syria. Still, the deal raised hopes for a political settlement to the ruinous war, in part because the landscape has significantly shifted recently. For one thing, the tide has turned in Syrian President Bashar al-Assad’s favor militarily over the
past year, with the government retaking the city of Aleppo from the rebels just days ago. Also, Turkey, which is fighting Kurdish and Islamic militants at home, appears more willing to strike a bargain with Russia if it means protecting its borders. “This is a different political scene, and one would expect some outcomes to emerge,” said Hilal Khashan, political science professor at the American University of Beirut. He cautioned, however, against expecting immediate results from the first round of talks. Sy r i a n Foreig n Mi n ister Wa l id a l- Moa l lem we lcomed the cease-fire agreement and said there is a “real chance” for a political settlement. In comments made to Syrian TV, he said the Syrian government will attend the peace talks “with an open mind,” but he suggested it would not be willing to compromise on Assad’s fate. Assad’s remaining in power has been a major sticking point in the crisis. “Everything is negotiable except national sovereignty and the people’s right to choose its leadership,” al-Moallem said. Putin said the cease-fire would be guaranteed by both Moscow and Turkey. Turkey has been allowing opposition forces to use its long border with Syria to cross back and forth. The agreement was also praised by Iran, another of Assad’s strongest backers. Russian Defense Minister Sergei Shoigu said the truce would in-
Osama Abu Zeid, a leader of the main moderate Syrian opposition group Free Syrian Army, shows what he said is a copy of the five-point cease-fire agreement for Syria during a news conference in Ankara, Turkey, on Thursday. Abu Zeid said his group, one of the 13 armed opposition factions, had agreed to abide by the nationwide cease-fire agreement that took effect at midnight on Thursday. The truce will be followed by peace talks in Kazakhstan that will focus on finding a solution for Syria’s crisis, Abu Zeid said. AP/Burhan Ozbilici
clude 62,000 opposition fighters across Syria and that the Russian military has established a hotline with its Turkish counterpart to monitor compliance. Sergey Lavrov, Russia’s foreign minister, said President-elect Donald J. Trump’s administration will be welcome to join the peace process once he takes office. Putin sa id he ordered t he Russian military to scale back its presence in Syria, where it has provided crucial support to Assad’s forces. Putin didn’t say how many troops and weapons would be withdrawn. He said Russia would continue “fighting international terrorism in Syria” and supporting Assad’s military. The UN special envoy for Syria, Staffan de Mistura, welcomed the cease-fire announcement, saying he hopes the agreement will save civilian lives, facilitate the delivery of humanitarian aid and pave the way for productive peace talks. Earlier on Thursday, Turkey called on Hezbollah to withdraw its fighters from Syria. The Iranian-backed extremist group has sent thousands of fighters to support Assad and has been playing an instrumental role in the civil war since 2013. Foreign fighters from around the world have joined both sides of the Syrian conflict, which has displaced half the country’s pop-
ulation and produced more than 4 million refugees. Many of those refugees have been streaming into Europe, fueling anti-immigration sentiment and terrorist fears that are reshaping the continent’s political landscape. Syria’s military noted that the cease-fire comes after the “successes achieved by the armed forces,” an apparent reference to the fierce fighting in Aleppo. Osama Abo Zayd, a spokesman for mainstream Syrian opposition groups, told reporters in the Turkish capital of Ankara that 13 armed opposition factions have signed the agreement. He said the peace talks would be based on the Geneva 2012 declaration that calls for a governing body with full executive powers to run Syria during a transition period. “This means that there will be no presence for Assad in the future,” he said. However, Khashan, the political analyst, said Assad’s exit is “out of the question.” “Neither the Russians nor the Iranians would allow it to happen.” Saeed Sadek, a professor of political sociology at Cairo’s Future University, said Assad has no power to accept or reject any deals. “He is now under the control of Moscow, Tehran and Ankara. All these countries will decide his future,” he said. AP
www.businessmirror.com.ph
American Jews divide over strain in US-Israel ties
F
or Rabbi Gerald Sussman of Temple Emanu-El on Staten Island in New York City, the Obama administration’s recent confrontation with Israel was a stunning turn for a president who had enjoyed support from many members of his congregation. “The word ‘betrayed’ would not be too strong a word,” he said. But in Los Angeles, Rabbi John L. Rosove of Temple Israel of Hollywood, who is the chairman of the Association of Reform Zionists of America, felt differently. He applauded the speech delivered on Wednesday by Secretary of State John Kerry explaining the decision by the United States not to block a United Nations Security Council resolution that condemned the construction of Israeli settlements in the West Bank. Rabbi Rosove also suggested that many American Jews were broadly supportive of the Obama administration. “I felt Kerry was exactly right,” he said. “The people who will criticize him will take a leap and say he’s anti-Israeli, just as some American Jews are saying Obama is an anti-Semite. This is ridiculous. They recognize and cherish the state of Israel.” The relationship between Israel and the United States, historically the Jewish state’s closest ally, has seen periods of strain and tension almost from the day of Israel’s creation in 1948. But rarely has the situation between the two countries been this stressed, with President Barack Obama under attack not only from Prime Minister Benjamin Netanyahu, but also from President-elect Donald J. Trump. The events of the past few days have renewed a long-standing debate over whether American Jews must always stand with the Israeli government, and under what circumstances should they criticize a friend. “There’s a very clear values clash going on,” said Rabbi Jill Jacobs, the executive director of T’ruah, a rabbinical human-rights organization. “On the one hand, we have a small, but vocal, minority of American Jews who believe that supporting Israel means supporting the right-wing agenda, the current government. And on the other, there is a larger percentage of American Jews who are committed to Israel and committed to democracy and want to see it as a safe place that reflects our values.” This is a community that is hardly monolithic. For one thing, younger Jews are seen as less likely to identify themselves as religious or supportive of Israel, and do not share memories of the Holocaust or the wars with Israel’s Arab neighbors. American Jews are also overwhelmingly Democratic; Jews voted for Hillary Clinton over Trump, 71 percent to 24 percent, according to exit polls. NYTNS
Obama expands environmental legacy with 2 Western monuments
S
ALT LAKE CITY—President Barack Obama expanded his environmental legacy in the final days of his presidency with national monuments designations on lands in Utah and Nevada that have become flashpoints over use of public land in the US West. The Bears Ears National Monument in Utah will cover 1.35 million acres in the Four Corners region, the White House announced on Wednesday. In a victory for Native American tribes and conservationists, the designation protects land that is considered sacred and is home to an estimated 100,000 archaeological sites, including ancient cliff dwellings. It’s a blow for state Republican leaders and many rural residents who say it will add another layer of unnecessary federal control and close the area to new energy development, a common refrain in the battle over use of the American West’s vast open spaces. Utah’s attorney general vowed to sue. In Nevada a 300,000-acre Gold Butte National Monument outside Las Vegas would protect a scenic and ecologically fragile area near where rancher Cliven Bundy led an armed standoff with government agents in 2014. It includes rock art, artifacts, rare fossils and recently discovered dinosaur tracks.
The White House and conservationists said both sites were at risk of looting and vandalism. “Today’s actions will help protect this cultural legacy and will ensure that future generations are able to enjoy and appreciate these scenic and historic landscapes,” Obama said in a statement. Obama’s creation and expansion of monuments over the course of his eight years in office covers more acreage than any other president. His administration has rushed to safeguard vulnerable areas ahead of President-elect Trump’s inauguration. It has blocked new mining claims outside Yellowstone National Park and new oil drilling in the Arctic Ocean. Obama’s creation and expansion of monuments covers more acreage than any other president. But Trump’s upcoming presidency has tempered the excitement of tribal leaders and conservationists, with some worrying he could try to reverse or reduce some of Obama’s expansive land protections. Utah’s Republican senators vowed to work toward just that. “This arrogant act by a lameduck president will not stand,” US Sen. Mike Lee tweeted about Bears Ears, which is named for a set of rock formations.
Sen. Orrin Hatch said Obama showed “an astonishing and egregious abuse of executive power” and that “far-left special interest groups matter more to him than the people who have lived on and cared for Utah’s lands for generations.” Christy Goldfuss, managing director of the White House Council on Environmental Quality, said the Antiquities Act that allows a president to create monuments does not give a president authority to undo a designation, a rule the courts have upheld. She acknowledged that Congress could take action, though. Opponents agreed the area is a natural treasure worth preserving but worried the designation would restrict oil and gas development as well as residents’ ability to camp, bike, hike and gather wood. New mining or energy development will be banned, but existing operations won’t be affected, federal officials said. Wood and plant gathering is still allowed as well as hunting, fishing and other recreation, they said. Members of Utah’s all-GOP congressional delegation had backed a plan to protect about 1.4 million acres at Bears Ears, while opening up other areas of the state for development. The boundaries of the
monument are roughly based on that plan—significantly smaller than what a coalition of tribes had sought. But Navajo Nation President Russell Begaye called it an exciting day for his tribe and people of all cultures. “We have always looked to Bears Ears as a place of refuge,” Begaye said. “The rocks, the winds, the land—they are living, breathing things that deserve timely and lasting protection.” The Navajo Nation is one of five tribes that will get an elected official on a first-of-its-kind tribal commission for the Bears Ears monument. It will provide federal land managers with expertise about the area, officials said. Tucked between existing national parks and the Navajo reservation, the monument features stunning vistas at every turn, with a mix of cliffs, plateaus, towering rock formations, rivers and canyons across wide expanses covered by sagebrush and juniper trees. At the Gold Butte site, Native American rock art and artifacts are scattered amid rugged mountains, sandstone formations and Joshua tree forests. Pioneers used the area for cattle ranching and mining, while campers and ATV riders enjoy it today. It’s named for an early 1900s mining town. AP
U.S. Interior Secretary Sally Jewell looks in to a canyon at Gemini Bridges near Moab, Utah, during a tour to meet with proponents and opponents to the Bears Ears monument proposal on July 14. President Barack Obama designated two national monuments on Wednesday at sites in Utah and Nevada that have become key flashpoints over use of public land in the US West. AP/Rick Bowmer
The World BusinessMirror
www.businessmirror.com.ph
Saturday, December 31, 2016
A7
US punishes Russia over election hacking
W
ASHINGTON—President Barack Obama struck back at Russia on Thursday for its efforts to influence the 2016 election, ejecting 35 suspected Russian intelligence operatives from the United States and imposing sanctions on Russia’s two leading intelligence services.
The administration also penalized four top officers of one of those services, the powerful military intelligence unit known as the GRU. Intelligence agencies have concluded that the GRU ordered the attacks on the Democratic National Committee and other political organizations, with the approval of the Kremlin, and ultimately enabled the publication of the emails it harvested. The expulsion of the 35 Russians—whom the administration said were spies posing as diplomats and other officials—and their families was in response to the harassment of American diplomats in Russia, State Department officials said. It was unclear if they were involved in the hacking. In addition, the State Department announced the closing of two waterfront estates—one in Glen Cove, New York, and another on Maryland’s Eastern Shore—that it said were used for Russian intelligence activities, although officials declined to say whether they were specifically used in the electionrelated hacks. Taken together, the sweeping actions announced by the White House, the Treasury, the State Depar tment and intel ligence agencies on Thursday amount to the strongest US response yet to a state-sponsored cyber attack. They also appeared intended to box in President-elect Donald J. Trump, who will now have to decide whether to lift the sanctions on Russian intelligence agencies when he takes office next month. Trump responded to the Russian sanctions late on Thursday by reiterating a call to “move on.” But he pledged to meet with intelligence officials, who have concluded that the Russian hacking was an attempt to tip the election to Trump. In an earlier statement from Hawaii, Obama took a subtle dig at
35 The number of suspected Russian intelligence operatives who were ordered expelled from the United States
Trump, who has consistently cast doubt on the intelligence showing that the Russian government was deeply involved in the hacking. “A l l A mer ic a ns shou ld be alarmed by Russia’s actions,” Obama said, and added that the United States acted after “repeated private and public warnings that we have issued to the Russian government, and are a necessary and appropriate response to efforts to harm US interests in violation of established international norms of behavior.” He issued a new executive order that allows him, and his successors, to retaliate for efforts to influence elections in the US or those of “allies and partners,” a clear reference to concern that Ru ssi a’s ne x t t a rget m ay be Germany and France. A lready there are reports of inf luence operations in both. Trump’s position is at odds with most members of his party, who, after classified briefings, have called for investigations into the combination of cyber attacks and old-style information warfare used in the 2016 campaign. Trump has largely stuck to the theory he set forth in a debate with Hillary Clinton in September, when he said the hacks could
U.S. President Barack Obama (right) shakes hands with Russian President Vladimir Putin before a bilateral meeting at United Nations headquarters on September 28, 2015. AP/Andrew Harnik
have been organized by “somebody sitting on their bed that weighs 400 pounds.” Russia criticized the sanctions and vowed retaliation. “Such steps of the US administration that has three weeks left to work are aimed at two things: to further harm Russian-American ties, which are at a low point as it is, as well as, obviously, deal a blow on the foreign policy plans of the incoming administration of the president-elect,” Dmitri S. Peskov, the spokesman for President Vladimir Putin, told reporters. Konstantin Kosachyov, the head of the foreign affairs committee in the upper house of the Russian parliament, told Interfax that “this is the agony not even of ‘ lame ducks,’ but of ‘political corpses.’” Des pite t he i nter n at ion a l f a l l out a nd p o l it i c a l re p e r cussions surrounding the announcement, it is not clear how much effect the sanctions will have, except on the ousted diplomats, who have until midday on Sunday to leave the countr y. GRU officials rarely travel to the US, or keep assets here. The four Russian intelligence officials are Igor Valentinovich
Korobov, the chief of the GRU, and three deputies: Sergey Aleksandrovich Gizunov, Igor Olegovich Kostyukov and Vladimir Stepanovich Alexseyev. The administration also put sanctions on three companies and organizations that it said supported the hacking operations: the Special Technology Center, a signals intelligence operation in Saint Petersburg, Russia; a firm called Zorsecurity that is also known as Esage Lab; and the Autonomous Noncommercia l Organization P rofe s s io n a l A s s o c i at io n of Designers of Data Processing Systems, whose lengthy name, US officials said, was cover for a group that provided special training for the hacking. Still, the sanctions go well beyond the modest sanctions imposed against North Korea for its attack on Sony Pictures Entertainment two years ago, which Obama said, at the time, was an effort to repress free speech—a somewhat crude comedy, called The Interview, imagining a CIA plot to assassinate Kim Jung Un, the country’s leader. The sanctions are not as biting as previous ones in which the US and its Western allies took aim
at broad sectors of the Russian economy and blacklisted dozens of people, some of them close friends of Putin’s. Those sanctions were in response to the Russian annexation of Crimea and its activities to destabilize Ukraine. Trump suggested in an interview with The New York Times this year that he believed those sanctions were useless, and left open the possibility he might lift them. The FBI and the Department of Homeland Security on Thursday also released samples of malware and other indicators of Russian cyber activity, including network addresses of computers commonly used by the Russians to start attacks. But the evidence in a report, in which the administration referred to the Russian cyber activity as Grizzly Steppe, fell short of anything that would directly tie senior officers of the GRU, or the FSB, the other intelligence service, to a plan to influence the election. A more detailed report on the intelligence, ordered by Obama, will be published in the next three weeks, though much of the information—especially evidence collected from “implants” in Russian computer systems, tapped conver-
sations and spies—is expected to remain classified. Several Obama administration officials, including Vice President Joe Biden, have suggested that there may also be a covert response, one that would be obvious to Putin but not to the public. W hile that may prove satisfying, many outside experts have said that, unless the public response is strong enough to impose a real cost on Putin, his government and his vast intelligence apparatus, it might not deter further activity. “They are concerned about controlling retaliation,” said James A. Lewis, a cyber expert at the Center for Strategic and International Studies in Washington. But John P. Carlin, who recently left the administration as the chief of the Justice Department’s national security division, where he assembled cases against North Korean, Chinese and Iranian hackers, called the administration’s actions a “significant step that is consistent with a new model: W hen you v iolate norms of behav ior in this space, we can figure out who did it and we can impose consequences.” NYTNS
Japan’s once-dominant carmakers face pay hikes to lure geeks
H
eadhunter Casey Abel spent four months trying to hire a data-center architect for a Japanese automaker, including five meetings with the client—one with the top executive. In the end, the informationtechnology (IT) specialist joined an e-commerce company abroad for significantly more money. “There’s just a massive mismatch in salaries,” said Abel, managing director at recruiter HCCR K.K., who has spent as long as a year trying to land some IT candidates. “You’ve got some engineers making ¥20 million ($170,000) a year. Then you try to fit them in the traditional manufacturer-based salary structure where it should be ¥7 million to ¥9 million.” Attracting the best information technologists is becoming increasingly important for Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co. as they seek a bigger share of revenue from IT-driven services, such as ridesharing and cloud-based monitoring of vehicles. Nissan CEO Carlos Ghosn has said Japanese carmakers can’t afford to lose the
“global war for talent” to new rivals, like Uber Technologies Inc. and Tesla Motors Inc. Luring such talent requires big pay bumps in Japan because the companies are chasing the same experts that banks, tech companies and everyone else needs, Abel said. The automakers “operate within extremely strict budgets and the business is generally low margin.” Japanese companies suffer from a dearth of domestic talent and the perception their business is more “mature and slow moving” than the new wave of tech startups. Honda said it would adopt a more f lexible salary policy at its new Tokyo lab, while Nissan declined to comment specifically on pay at its new Tokyo data office. Toyota located its socalled connected-car business unit and artificial intelligence (AI) research center in the US, which a spokesman said offer competitive compensation.
Hunt for professionals
Japan has had the most severe talent shortages in the world since
2010, with IT professionals among the top three hardest positions to fill, according to Manpower Group’s annual market survey. The country is short of an estimated 171,000 IT staff in 2016 and the number may more than quadruple to 789,000 by 2030, according to a survey by the Ministry of Economy, Trade and Industry (Meti). That race for staff is accelerating. Nissan said in October it plans to hire about 150 engineers in Tokyo by 2018 for software, cloud computing, data analytics and machine learning. Honda starts operation next year of a Tokyo research center mainly for artificial intelligence and IT. Volkswagen AG said this week it would hire more than 1,000 IT experts, tapping hightechnology sectors, gaming industry and top-level research centers, in the next three years. Toyota last month announced i t s c o n n e c t e d - c a r s t r a t e g y, which includes building a big data center to create new business using drivers’ data such as tailoring insurance policies to drivers’ habits, and hired former
US defense scientist Gill Pratt to set up and lead an AI research institute in the US. “You need really good talents to do those really complicated things,” said Jeremy Carlson, an analyst of autonomous driving at IHS Markit. “Japan has an educated and intelligent population, but many highly motivated and capable individuals in these fields flock to areas like Silicon Valley.” Japan came last in Meti’s survey in terms of the proportion of respondents who thought IT was an interesting area to work, while Indonesia, India and the US ranked highest. T he Japanese cor porations are following the lead of US rivals Ford Motor Co. and General Motors Co. Ford established a science lab in Silicon Valley in 2012 to develop software, while GM has built two data centers since 2013 to streamline product development, manufacturing, marketing and sales, as well as connectivity services. Honda is trying to address the salary issue by adopting a more flexible work and pay system at
its new Tokyo lab, rather than the rigid, seniority-based pay grades used elsewhere within the company, said Yoshiyuki Matsumoto, president of Honda’s research arm, which operates largely autonomously. With the intense competition for staff in Japan, Toyota in April set up its Toyota Connected Inc. data unit in Plano, Texas. The division works with Microsoft Inc. to develop data management and services for its operations worldwide, including systems for connected cars that help make it easier for people to use automotive technology. Then there’s the problem of attention span.
Design cycle
The development cycle for a car usually last years, which can be frustrating for programmers used to building a system in weeks, said Mandali Khalesi, Asia-Pacific chief of theNetherlands-based digital map-maker HERE, owned by German automakers Audi AG, BMW AG and Daimler AG. “These people are from complete IT backgrounds and they
don’t e x pec t t hese long t i me cycles,” he said in an interview in Tokyo. Nissan decided to try to turn that to its advantage. It’s building the 150-person connectivity division in Tokyo, partly in the belief that the long-serving work attitude is Japan’s edge over Silicon Valley, according to Ogi Redzic, head of the unit. About half the IT professionals in Japan have never changed jobs, compared with 14 percent in the US and 21 percent in China, according to the METI survey. “We cannot afford to have people that only come here for a year or two,” said Redzic, a former executive of HERE, who joined Nissan and alliance partner Renault SA this year to head the group’s IT service for connected cars. “The way that people are going to get remunerated is going to be tied to the type of work that they do,” said Redzic, declining to give details. “We fully get it that if you want to build data-analytics themes there are certain market conditions around what those people expect.” Bloomberg News
OurTime BusinessMirror
A8 Saturday, December 31, 2016 • Editor: Efleda P. Campos
news@businessmirror.com.ph
Bello optimistic over impending release of elderly and sickly political prisoners I
Iloilo City govt gift giving benefited over 25,000 older people, indigents and PWDs
G
OVERNMENT chief peace negotiator (GRP) Silvestre Bello made a historic first by visiting one of the village strongholds of the rebel New People’s Army (NPA) in Paquibato District, Davao City, on December 26, to attend a peace forum that also coincided with the 48th anniversary of the Communist Party of the Philippines (CPP). Speaking before 8,000 rebel sympathizers and supporters, Bello shared the same optimism with CPP founding chairman Jose Maria Sison who, in a video mes-
sage, said the prospect of achieving peace under the Duterte administration is brighter than any point in the rebel’s almost five decades of armed rebellion.
China plans to fully open care market for elders in 4 years
B
EIJING — China w i l l fully open its elderly care market by 2020, a General Office of the State Council statement announced on December 23. The move will substantially increase the supply of products and services in the market, standardize regulations and raise service quality, the statement said. Foreign investment in the sector will be facilitated and
administrative-approval procedures simplified, it said. China’s aging society is a major social issue. There are currently more than 220 million people over 60 years old in the country, 16.1 percent of the population, with numbers growing. A total of 15.3 percent of senior citizens believe they need to be taken care of, more than double the number in 2000, putting significant pressure on the government. PNA/Xinhua
NEW YEAR FRUITS Lola Lauren, 60, sells table grapes grown in Narvacan, Ilocos Sur. Farmers grow green grapes in Barangay Sulvec at P120 a kilo. Narvacan’s green grapes are patronized as a local holiday fruit. MAU VICTA
The head of the GRP peace panel was accompanied by his undersecretary Joel Maglungsod and Interior Secretary Mike Sueno. Bello assured rebel leaders some of the sickly and elderly political detainees would soon be released. “It is just a matter of time. The President will keep his word,” Bello said during a break in the program of the rebels. President Duterte earlier announced he would order the release of elderly and sick detained rebels in time for Christmas for humanitarian reasons. Presidential Adviser for Peace Process Jesus Dureza also said a directive has already been issued for the release of 17 or 20 detained rebels. “Let us just wait for the formal announcement of the President,” Dureza said earlier. Bello added that the next release
of rebels for humanitarian reasons is not tied to the bilateral ceasefire agreement the government is seeking to forge with the rebels. The National Democratic Front, the political umbrella of the CPP and the NPA, has demanded the release of 434 detained rebel leaders and members as compliance to the Comprehensive Agreement on Respect of Human Rights and International Law, which the two peace panels signed during the Ramos administration. Bello asked for a little more patience. “There are some legal process we have to comply with before they can be released,” he said. He said he will be meeting with the President on December 29 and will again bring up the matter. Bello, who is also labor secretary, agreed with Sison a final peace deal will have to be signed
very soon so that “this can be implemented under the Duterte administration.” A former human-rights lawyer, Bello said it is time to end the war in the countryside for the sake of combatants and the communities affected by the war. He said the next round of talks to be held in Rome, Italy, would now focus on the crucial agenda of social and economic reforms. “We have tapped the expertise of economists from the University of the Philippines to draft the economic reform agenda of the government, which we will present on the negotiating table in Rome,” Bello said. At least two days have been dedicated for discussions on social and economic reforms during the five-day formal talks, which begin on January 19. PNA
Poor Kidapawan elders get free eye surgery for Christmas
K
IDAPAWAN CITY—About 100 poor elders here were given free cataract and pterygium operations on December 20 as an early Christmas gift from the city government. Mayor Joseph Evangelista said the program aims to ensure indigent patients could avail themselves of cataract and pterygium surgeries for free in a bid to curb the prevalence
of visual impairment and blindness among his constituents. The city government has tapped several local ophthalmologists who offered free services for the initiative. Beneficiaries were endorsed through the Office of Senior Citizens Affairs (Osca) and underwent preliminary examinations to determine the degree of their visual condition. Evangelista also plans to expand
the program next year, which could open more slots for qualified indigent patients incapable of seeing an eye specialist. “We are planning to tap national line agencies to support and partner with us in this endeavor by integrating it in their programs,” he said. Evangelista is particularly eyeing partnerships with PhilHealth and the Department of Health on the program by next year. PNA
LOILO CIT Y—The city government here again brought cheer to more than 25,000 indigents, senior citizens and persons with disability (PWDs) with its gift-giving activity on December 23 and 24. City Social Welfare and Development (CSWDO) head A lfredo Villanueva said they decided to hold the gift-giv ing for PWDs and the elderly on December 23 and indigents on December 24. This way, he said, the PWDs and elderly were given good accommodation, given their condition. Some 2,500 PWDs and elderly and 23,000 indigents were chosen as recipients. Tickets were provided to the target recipients to ensure everyone was accommodated. The allocation for the elderly was coursed through the Office of Senior Citizens Affairs, while for the PWDs, it was through the Persons with Disability Affairs Office. Meanwhile, for city indigents, the tickets were distributed through their barangay captains. The gift-giving activity was institutionalized under the administration of Mayor Jed Patrick Mabilog to make sure city indigents partake of blessings during this Christmas season. Each recipient received a gift pack containing rice, noodles and canned goods. The activity was held at the Iloilo Freedom Grandstand. PNA
Antique mayor gives a bucket of rice for 30 seniors
S
AN JOSE DE BUENAVISTA, A nt ique —T h i r t y e lderly from Barangay Igbalangao in Bugasong town each received a bucket of rice from the benevolent staff of Radyo Natin FM Station on December 23. Station Manager Jose Allan S. Bartolo initiated the activity as part of his advocacy to share whatever was given to him. This drive is supported by his friends abroad, who sent cash donations and clothes, books and toys he shares with the less-privileged in their community. This year they trekked a good distance uphill to reach the small hut of a blind woman, all living by
herself at the age of 97 in Sitio Bulan-bulan, Barangay Igbalangao. “Like the blind woman, there were other blind people whom we selected to be the recipients of this year’s Rice Bucket Challenge. They may have lost their sight and they were denied to savor through their eyes the beauty of this world, yet our love and care for them gave them light and hope,” Bartolo said in a phone-patch interview while traversing the hills to reach the woman’s place. One bucket contains five gantas of clean rice. If there are sponsors, the bucket goes with a pack of milk, sugar and coffee. T he r ice -buc ket c h a l lenge
started in 2013, as Bartolo was inspired to do things “outside the box” after he finished his Philippine Development Education (PE) Course. It led to his winning the international recognition as Joe Biden Development Educator of the Year in 2015. Aside from giving buckets of rice just the other week, Bartolo trekked to a remote village, Barangay Yapu, also in Bugasong town, to give gifts to 110 school children and 22 household heads. He also chose some elementar y schools located in the remotest part of Bugasong and conducted a school-feeding program, gardening in school
where he distributed vegetable seeds to school children, and teaching children to love reading by giving them books from other benevolent donors. Bartolo also showed his care for the environment through his biannual tree-planting activities in Barangay Camangahan, where Bugasong’s watershed was situated. Artolo thanked the elderly who received the bucket of rice, for inspiring and reminding him the meaning of life. Their smiles, Bartolo added, remind those who have more in life the worthiness of existence. And for Bartolo, “this is the real meaning of Christmas.” PNA
GRANDMA’S BLOOMS To keep busy, Samahan ni Lolo at Lola Board Chairman Mary Grace Esnaola, a retired teacher, maintains a flower garden in front of her home in Santiago City, Isabela. With her elderly sister Marjorie Esnaola as president of Samahan ni Lolo at Lola of Centro West Village, they conceptualized how to help members who were mostly retired teachers. LEONARDO PERANTE II