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Thursday, February 22, 2018 Vol. 13 No. 134

DILG: Place Boracay under state of calamity By Ma. Stella F. Arnaldo

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@akosistellaBM Special to the BusinessMirror

HE Department of the Interior and Local Government (DILG) has proposed to place Boracay Island under a state of calamity to allow government agencies to implement needed infrastructure programs, clean it up and dismantle illegal buildings.

Densing: “The proposal will make it mandatory for national government agencies to correctly rehabilitate the island in its totality.”

In a news briefing at the Department of Tourism (DOT), after the inter-agency task force on Boracay met on Wednesday to update the members on work accomplished, Continued on A2

Pernia says at least 35 BBB projects done by 2022 By Elijah Felice E. Rosales @alyasjah

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he government is targeting to complete at least half of the 75 flagship projects listed under its infrastructure program before President Duterte steps down in 2022, the country’s socioeconomic planning chief said on Wednesday. Speaking at the Makati Business Club and Philippine Chamber of Commerce and Industry’s joint membership meeting, Socioeconomic Planning Secretary Ernesto M. Pernia said this means at least 35 of the 75 flagship projects under the “Build, Build, Build” (BBB) program should be done in less than five years. So far, only two of the 75 projects broke ground—the Clark See “Pernia,” A2

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@llectura

onsumers will start feeling the impact of the modified cap on the allowable rate of system losses that can be passed on to consumers in their May electricity bills. Under the newly approved resolution “Adopting the ERC Rules for Setting the Distribution System Loss [DSL] Cap and Establishing Performance Incentive Scheme for Distribution Efficiency,” distribution utilities, like the Manila

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Can Duterte reduce the nation’s dependence on migration? Rene E. Ofreneo

laborem exercens

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ike the execution of Flor Contemplacion in Singapore in 1995, the discovery of the frozen body of Joanna Demafelis shocked the nation on the gravity of abuse Filipino maids have been suffering from the hands of cruel employers overseas. But, unlike the slow and uncertain initial reaction of the government to the Contemplacion saga in 1995, the response of the Duterte administration to the case of Demafelis was swift and decisive: public expression of anger at the Kuwait employers and public expression of displeasure on the weak protection being extended to them by the host Kuwait government. Although opposed by the private recruiters, the ban on the deployment of new hires to Kuwait has met popular approval. Is the Duterte administration prepared to reduce the nation’s dependence on migration? Is the Duterte administration prepared to pursue a development program that lessens such dependence? Last year, in an overseas Filipino workers side forum in Vietnam during the Apec summit, President Duterte blurted out an observation no President before him dared say in public (and more so, before an OFW gathering)—that the departure of the best and the brightest has been stunting the growth of Philippine industry. “Paano ang mga naiwan?” was his plaintive question. Of course, there is more than a grain of truth in what the President said about the exodus of Filipino talents and skills. The biggest economies in Southeast Asia‚Singapore, Malaysia and Thailand —and all the Organisation for Economic Co-operation and Development Continued on A12

PAL to shelve Naia 2 upgrade when P350-B project gets off the ground By Lorenz S. Marasigan Environment Secretary Roy A. Cimatu (third from left) stresses a point during the presentation of the interagency task force on Boracay members’ work program. The task force, composed of the departments of Environment and Natural Resources, the Interior and Local Government, and of Tourism, met on Wednesday at the DOT building. Listening to the presentation are Interior Secretary Eduardo M. Año and Tourism Secretary Wanda Corazon T. Teo. Photo courtesy D.O.T.

May electricity bills to reflect reduced system-loss charge By Lenie Lectura

2016 ejap journalism awards

The lowering of the system-loss caps is a move to bring down the power rates and help electricity consumers mitigate the impact of rising costs of commodities and services.”—Devanadera Electric Co., will have a 6.5-percent DSL cap for 2018. This will be gradually reduced annually until it reaches the 5.5-percent DSL cap level by 2021. Meanwhile, electric cooperatives

PESO exchange rates n US 52.2330

(ECs) are grouped into three clusters based on similar technical considerations and will have a 12-percent DSL cap in 2018. ECs can only charge within the range of 12 percent to 8.25 percent until 2022 onward,

based on the cluster grouping that they were assigned in. “The lowering of the systemloss caps is a move to bring down the power rates and help electricity consumers mitigate the impact of rising costs of commodities and services. This will encourage distribution utilities [DUs] to improve their distribution system and facilities so that they adhere to the newly prescribed system-loss cap,” Energy Regulatory Commission Chairman Agnes VST Devanadera said. See “Electricity bills,” A12

@lorenzmarasigan

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he proposal of legacy carrier Philippine Airlines (PAL) to develop the second terminal of the Ninoy Aquino International Airport (Naia) will have to take a “back seat” in favor of a larger plan to develop the whole airport complex by a “super consortium.” Jaime J. Bautista, the carrier’s president, said that while his group is still in discussion with stakeholders for the development of the Naia Terminal 2, the P20-billion proposal of the group will have to make way for the P350-billion unsolicited offer of the Naia super consortium. “We are still in discussion, but when the consortium takes over, they will have to work with Pagcor. So, yes, it will have to take a back seat for now,” he said, referring to the Philippine Amusement and Gaming Corp. The two groups were at loggerheads over the lease of a portion of Nayong Pilipino in Pasay City, which the carrier

₧20B The proposed budget of the Philippine Airlines for the development of Terminal 2

wanted to develop. The carrier’s proposed Naia 2 annex is designed to handle 12 million to 15 million passengers per year, and would be able to serve 12 to 17 wide-bodied and single-aisle jets. It will also include multilevel parking for 1,000 vehicles, a new cargo terminal and ground service facilities. On the other hand, the Naia super consortium’s P350-billion proposal involves expanding and interconnecting the existing terminals of the Naia, upgrading airside facilities, and developing commercial facilities to increase airline and airport efficiencies, enhance

n japan 0.4871 n UK 73.0896 n HK 6.6757 n CHINA 8.2387 n singapore 39.5975 n australia 41.1596 n EU 64.4399 n SAUDI arabia 13.9285

See “PAL,” A2

Source: BSP (21 February 2018 )

BMReports BusinessMirror

A2 Thursday, February 22, 2018

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Lawmakers okay final version of ease of doing business bill

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By Jovee Marie N. dela Cruz

@joveemarie

he congressional bicameral conference committee has approved the final version of the ease of doing business bill, which seeks to promote the Philippines as a business-friendly investment destination.

Congressmen and senators concluded their discussions on divergent provisions of House Bill 6579 and Senate Bill 1311, entitled the “Ease of Doing Business and Efficient Government Service Delivery Act of 2018,” on February 14.

 The lower chamber is expected to ratify the bicameral committee report on Monday and immediately transmit the ratified bill to the Palace for President Duterte’s signature. House Committee on Economics Affairs Chairman Arthur C. Yap of the First District of Bohol, a member of the committee, said the measure would simplify issuances of licenses, clearances or permits to business entities.

“Upon this bill’s passage into law, government agencies and units will be required to act on all applications for permits, licenses and authorizations within a given period of time, or else, the erring officials will be sanctioned not only administratively but criminally, as well,” Yap said. House Committee on Trade and Industry Chairman Ferjenel G. Biron of the Fourth District of Iloilo said, “The purpose of this bill is to provide an easy, simple, straightforward and trouble-free avenue for entrepreneurs, micro, small and medium businesses and ordinary citizens who would like to venture into business in the country.”

As the 12th-largest population and the 43rd-largest economy in the world, Rep. Luis Raymund F. Villafuerte Jr. of the Second District of Camarines Sur, the panel vice chairman and one of the authors of the bill, said the Philippines ranked as the second most-favored destination for foreign direct investments in Southeast Asia. However, Villafuerte added, the Philippines’s ease of doing business rank this year is one of the lowest in the world at 171st out of 185 countries. Yap noted that the reconciled version of the bill effectively amends and expands the Anti-Red Tape Act of 2007.
 
Once passed into law, processing time for simple permits will be reduced to 
three working days; complex transactions to seven working days; and highly technical application to 20 working days.
 The measure also reduces the number of signatories from five to three signatures; and will recognize electronic signatures or presigned permit/license/certification in case the authorized signatory is on official leave.
 
 However, the bill said cases that pose danger to public health, public safety, public morals or to public policy, and for highly technical ap-

plications, such as natural resource extraction activities, will be given more time for consideration but still, with specific time deadlines. “Essentially, we want to prevent discretion in government agencies and instrumentalities, as well as eliminating face-to-face transactions for permits and licenses, which breed corruption,” Yap said. The proposed law will also streamline procedures for the issuance of local business permits by using a single or unified business application for local tax and clearances, building clearances, fire safety inspection certificates, etc.; which shall also be available online; and create a one-stop business facilitation service on site and/or online in all cities and municipalities.

 “More important, innovation and technology allow us speed and security of transactions, which was not possible before. This, in turn, drives down costs for all our micro, small and medium enterprises [MSMEs], which comprise the bulk of Philippine businesses,” Yap added. Under the bill, all local government units are mandated to automate their business permitting and licensing systems with the help of the Department of Information

and Communications Technology (DICT), as the thrust will be online transactions. Another feature of the law is the issuance of local clearances, such as sanitary permits. Once the measure is enacted, environmental and agricultural clearances will be issued together with the business permit. These permits will have a validity of one year, which may be renewed within the first month of the year or anniversary date of the issuance of permit. Currently, permits are valid only until the end of the calendar year. It will also streamline procedures for securing the Fire Safety Inspection Certificate by
 limiting the processing time to 10 working days; and
 disallowing Bureau of Fire Protection personnel from selling or recommending any brand of fire extinguishers or equipment.
 The bill mandates the DICT’s creation of the Central Business Portal, which shall serve as the central system that will receive applications and capture applications data involving business-related transactions; and the Philippine Business Databank containing all data and information of registered business entities.

 It also calls for the set up of

DILG: Place Boracay under state of calamity DILG Assistant Secretary for Plans and Programs Epimaco V. Densing III said: “We are now proposing that Boracay Island be placed under a state of calamity. This was because during the initial meeting between [Environment] Secretary [Roy] Cimatu and [Interior] Secretary [Eduardo] Año last week, they talked about the possibility of closing the island or a moratorium on tourist visitations, to be able to fast-track whatever rehabilitation is needed on the island.” He said the task force, which is composed of the Department of Environment and Natural Resources (DENR), the DILG and the DOT, created a technical working group “to be able to determine the factual basis and legal basis of possibly declaring a state of calamity on the island. If ever the island will be put under a state of calamity, the first thing that will happen is the national government agencies will take over the management and

Pernia. . .

Continued from A1

International Airport and the TutubanMalolos Railway. “We want at least half of the projects near-complete, if not complete, by

the Anti-Red Tape Authority (referred to as the Authority), under the Office of the President, which will plan, implement and oversee national policy on anti-red tape and ease of doing business;
receive complaints, initiate investigations, and assist in filing of administrative and criminal cases related to anti-red tape. 
 
 The measure subjects all offices and agencies providing government services to a Report Card Survey initiated by the Authority, in coordination with the CSC and the Philippine Statistics Authority, which shall become the basis for the grant of awards, recognition, and/or incentives for excellent delivery of service in all government agencies.

 “This landmark law will make it faster and cheaper to do business in the Philippines. But we are not yet done, because amendments in the Corporation Code, Retail Trade Law, and the Financial Inclusion Act, which effectively modernizes the Warehouse Receipts Law and the Chattel Mortgage Law, are needed to give that full measure of support and services to our MSMEs. This will keep up the momentum of growth and expansion of our economy,” Yap said.

Continued from a1

operations of the island for at least six months.” He stressed that the problem of Boracay really is “an issue of managing it correctly. What we’re saying is, not all local officials that have been elected may necessarily be competent to manage such an island, or a primary tourist destination. So the proposal will make it mandatory for national government agencies to correctly rehabilitate the island in its totality. More than the pollution issues and environmental issues, but also including public safety [and] security to ensure that the island becomes environment-friendly, being a premier tourist destination.” He explained that, under normal circumstances, it would take years for government agencies to be able to implement their infrastructure program on an island like Boracay. “So if the island is put under a state of calamity, we

can fast-track the infrastructure needed to correct the drainage, the sewage system, including [conducting] the audit of the drainage system, because there may be some establishments tapping the [drainage] lines and throwing their pollutants there. Densing, who just returned from a trip to Boracay on Tuesday, said the declaration of the state of calamity will enable the DILG to “dismantle the illegal structures. “We know a lot of buildingcode violations have been made. We’ve been there; we saw a lot of infrastructure that were put up without permits from the local government and had no environmental clearance certificates from the DENR. So, with a state of calamity declaration, it will be easy to dismantle these.” He underscored the need for accountability for the challenges the island is now facing. “We know the island is in a situation right

now; those accountable officials have not done their jobs. [These are] local government officials a nd probably some n at ion a l government officials...from the DENR.” Boracay Island, famous the world over for its white-sand beach, is under the local government of Malay, Aklan, which is headed by Mayor Ciceron Cawaling. Sources said the proposal for the declaration of a state of calamity in Boracay will be presented to President Duterte “anytime soon.” On February 5 Duterte had given the environment and interior secretaries six months to fix the problems of Boracay, which include sewage spilling out into the open sea, violations of easement rules and overbuilding. Meanwhile, Environment Secretary Roy A. Cimatu, who had attended the meeting, said he would be going to Boracay on Thursday “to bring my personnel to augment

in the operations and performance of cleaning the sewage system [of the island].” For his part, Interior Secretary Eduardo M. Año warned local officials and other people responsible for the environmental destruction and overbuilding in Boracay that they would be held accountable for their actions. “We’ll make sure that those who are responsible or accountable for what happened to Boracay will be meted the appropriate sanctions so that there will be no repeat of whatever happened in Boracay.” For her part, DENR Undersecretar y for Manila Bay Concerns and Related Water Concerns Maria Paz Luna said the agency now has six teams on the ground in Boracay “composed of different regional personnel to prevent any kind of allegations of favoritism.” The teams are made up of technical personnel and law yers who will be “sweep-

ing” 800 establishments on the island in the next two weeks. “They are ready to issue immediate notices of violations or interim cease-and-desist orders on the inspection date itself,” she said. “So we urge the public and we urge the establishments in Boracay to start attaching to the sewer lines, to start ensuring that their effluents are within standards, if they are not connected to the sewer line.” According to DOT and DENR officials, sewage that has been treated by chemicals to clean it has to be of “swimming pool” quality before being discharged into the open sea. Tourism Secretary Wanda Corazon T. Teo said that, in the next meeting of the task force, they will invite Public Works Secretary Mark A. Villar and Justice Secretary Vitaliano N. Aguirre II. She added she and Cimatu and Año will be attending the Senate hearing on Boracay scheduled for March 2.

2022. Of the 75, half of them, or a little more than 35 of the projects, would be good,” Pernia said. However, Pernia admitted that “existing problems yet to be identified”are getting in the way of the P8.3-trillion infrastructure program. One of these is the sudden slowness on the part of

China in financing some of the projects. Pernia cited as example the two China-funded Pasig River bridges, which gained a lot of attention but have yet to break ground. “China is pressing us to do our part, but there is slowness on the side of China.” Nonetheless, the socioeconomic

planning chief said the government will carry on with its BBB program this year and assured that half of the listed projects under it will be delivered before the President heads back to Davao City for his retirement. “We should deliver this, because the country badly needs these infrastructure, especially those in the provinces,” he said. The Duterte administration is bent

on completing dozens of public infrastructure, such as the North Luzon Expressway Harbor Link, Luzon Spine Expressway, Philippine National Railway North and South Rails and the Metro Manila Subway, under its infrastructure program. It intends to achieve this dream by accelerating the country’s infrastructure-to-GDP ratio to 7 percent, which is expected to amount to as much as P9 trillion by the end of

the President’s term The government has, so far, allocated P3.6 trillion for its infrastructure program, most of which for transportation and connectivity projects in Metro Manila and other major urban centers. Aside from the annual budget, the “Build, Build, Build” program will also rake in 70 percent, or P84.84 billion, of the expected revenue of P121.2 billion from the new tax law.

pines are the United Kingdom at 18,111 (+15.01 percent); India at 13,779 (+16.72 percent); Singapore at 13,627 (+13.6 percent); and Malaysia at 12,012 (+17.6 percent). Visitors from Taiwan and Hong Kong, however, registered dips at 13.6 percent to 18,948, and 7.22 percent to 9,284, respectively. DOT Undersecretary for Tourism Development Planning Benito C. Bengzon Jr. told the BusinessMirror: “Chinese New Year fell in

February this year. This is probably the reason arrivals from Taiwan and Hong Kong dropped slightly in January.” He assured, however, that the DOT’s Market Development Group “will work double time on Taiwan and Hong Kong,” to get more visitors to come to the Philippines. No visitor-receipts data were released for January 2018, but revenue generated by the economy from tourism in January 2017 was P21.7 billion.

sengers annually, or double the current capacity of the Naia. Roughly P100 billion will be allocated for the first phase of the project, which should go on for about 48 months. The second phase, on the other hand, involves the development of an additional runway, taxiways, passenger terminals and associated support infrastructure. Toward the end of the second phase of the proposed program, the capacity of the Naia should reach the

100-million-passenger mark. The proposal also includes a people mover that would link all three terminals and connect the Naia to the existing masstransport system in Metro Manila, as well as an option for a third runway. Members of the Naia Superconsortium include: Aboitiz InfraCapital Inc., AC Infrastructure Holdings Corp., Alliance Global Group Inc., Asia’s Emerging Dragon Corp., Filinvest Development Corp., JG Summit Holdings Inc. and Metro Pacific Investments Corp.

Tourism. . .

Continued from A12

She noted that the industry is now “among the top contributors to our GDP.” Tourism now accounts for some 10 percent of the country’s GDP, defined as the total number of goods and services produced by the local economy. Other markets that showed improved arrivals in the Philip-

PAL. . .

Continued from A1

passenger comfort and experience and improve public perception of the Naia as the country’s premier international gateway. The plan is divided into two phases. The first one involves the improvements and expansion of terminals in the current Naia land area. Terminal capacity should reach 65 million pas-

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DOJ formally asks court to tag CPP and NPA as terrorist groups By Joel R. San Juan @jrsanjuan1573

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HE Department of Justice (DOJ) on Wednesday filed a petition before the regional trial court in Manila to declare the Communist Party of the Philippines (CPP) and its armed wing, the New People’s Army (NPA) or the Bagong Hukbong Bayan, as terrorist groups. The DOJ filed the petition for proscription through Senior Assistant State Prosecutor Peter Ong pursuant to Section 17 of Republic Act (RA) 9372, or the Human Security Act of 2007. If granted, this will allow the government to seek clearance from the Court of Appeals to engage in wiretapping activities against the communists, as well as apply for a freeze order on, and examination of, the bank accounts and assets of their leaders and identified members. In seeking to declare the communist groups as terrorists, the justice department highlighted the atrocities that the groups committed over the years. These include 12 incidents in 2017, such as the ambush-slay of four policemen in Davao del Sur; the ambush of Army soldiers on relief operations to victims of tropical storm Urduja in Northern Samar; the ambush in Tikalaan, Talakag town, Bukidnon, that killed a 4-month-old baby girl and a policeman; and the attack on the Presidential Security Group convoy in Arakan, Cotobato. These series of attacks by the NPA angered President Duterte and publicly tagged the group as terrorist. The DOJ emphasized that the groups were organized for the purpose of engaging in terrorism and, in fact, have been committing acts that fall under the RA 9372. Also cited in the petition was the purging activities of the CPP dubbed as “Kadena de Amor, Takip Silim, Kampanyang Ahos, Operation Missing Link, Zombie, Olympia,” which, the petition said, are all aimed at cleansing

its ranks of government infiltrators. It also accused the groups of being “insincere” in finding peaceful solutions to the decades-long insurgency problem in the country. “From the foregoing, respondents CPP and NPA are merely buying time by deceiving the Philippine government in enteringintopeacetalks,whiletheirmain purpose is to mobilize all their forces in preparation for the ‘people’s war’ aimed at overthrowing the duly constituted authorities,seizingcontrolofthePhilippine government and imposing a totalitarian regime,” the 55-page petition read. “Thus, there is no other time to put an end to their deception, to their ‘protracted people’s war’ and to their evil plan of imposing a totalitarian regime, but through the filing of this petition and, consequently, by declaring respondents CPP and NPA as terrorist and outlawed organization, associations and/or group of persons,” the petition added. Ong said the leaders of the CPP and NPA are expected to be summoned by the court to answer the petition. “We will follow the rules on civil procedures. Their leaders will be summoned to answer the petition,” the prosecutor said. Ong said officers from the National Intelligence Coordinating Agency and the Intelligence Service of the Armed Forces of the Philippines assisted him in coming up with the petition. When asked why the National Democratic Front was not included, Ong said the order issued by Justice Secretary Vitaliano N. Aguirre II to him was only for the CPP-NPA, adding it was also the same guidance issued by Aguirre to the prosecutor general. It would be recalled that President Duterte last December signed an order declaring the CPP-NPA as a terrorist organization and ordered Aguirre to immediately file a petition before the Manila RTC to classify the communist movement as a terrorist group under the Human Security Act of 2007.

Editor: Vittorio V. Vitug • Thursday, February 22, 2018 A3

US intel report on Duterte, PHL democracy ‘myopic, speculative’ By Bernadette D. Nicolas

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@BNicolasBM

alacañang refuted on Wednesday the WorldWide Threat Assessment report of the US Intelligence Community, which listed President Duterte as one of the Southeast Asian leaders that pose a threat to democracy and human rights. Presidential Spokesman Harry L. Roque Jr. said in a news statement that the assessment was “myopic and speculative at its best.” The report also stated that democracy and human rights in many Southeast Asian countries will remain fragile in 2018, as autocratic tendencies deepen in some regimes, while rampant corruption and cronyism undermine democratic values. “Countries in the region will struggle to preserve foreign policy autonomy in the face of Chinese economic and diplomatic coercion,” the report stated. Roque said that President Duterte is “no autocrat or has no autocratic tendencies” as he adheres to the rule of law and remains loyal to the Constitution. “An autocracy is not prevalent, as they would like everyone to believe. Our media are still able to broadcast and print what they want —‘fake news’­included. Our judiciary and the courts are functioning as usual. Our legislature remains independent and basic services are still being delivered,” Roque said.

“There is no revolutionary government or nationwide martial law, which US intelligence officials are saying that the President might declare or impose,” he added. In the report released on February 13, Daniel Coats, director of National Intelligence, said President Duterte will continue to wage his signature campaign against drugs, corruption and crime. “Duterte has suggested he could suspend the Constitution, declare a ‘revolutionary government’ and impose nationwide martial law. His declaration of martial law in Mindanao, responding to the ISISinspired siege of Marawi City, has been extended through the end of 2018,” the report stated. Also, it cited a Freedom House report in 2016 that listed Philippines as one of the 30 countries whose governments used social media to spread government views, to drive agenda and to counter government criticisms online. Other countries mentioned in the report were Turkey and Venezuela. Roque admitted that while it is

true that the administration uses and maximizes social media to promote its messages and accomplishments, members of the political opposition and other cause-oriented groups also use the same media to advance their agenda. “We have to understand the use of social media has become an important part of the daily lives of Filipinos. It is therefore foolhardy not to tap social media as a tool when the technology exists for free. I don’t know of any government in the free world which does not use the Internet and social media to promote its agenda. This is very true, especially in the case of the US. This latest intelligence assessment is a classic case in point,” he said.

Aside from Duterte, Cambodian leader Hun Sen was also cited in the report as he is seen to continue repressing democratic institutions and civil society, manipulate government and judicial institutions and use patronage and political violence to guarantee his rule beyond the 2018 national election. As for other Southeast Asian countries, the report mentioned that Rohingya crisis will also threaten Burma’s fledgling democracy, increase the risk of violent extremism and provide opportunities for Beijing to expand its influence. In Thailand leaders have vowed to hold elections later this year, but the new Constitution will institutionalize the military’s influence.

An autocracy is not prevalent [in the Philippines under President Duterte], as they [critics] would like everyone to believe. Our media are still able to broadcast and print what they want—‘fake news’­ included. Our judiciary and the courts are functioning as usual. Our legislature remains independent and basic services are still being delivered. “There is no revolutionary government or nationwide martial law, which US intelligence officials are saying that the President might declare or impose.”—Roque

Saguisag urges congressional approval of HR defenders bill By Butch Fernandez @butchfBM

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uman-rights advocates asked Congress on Wednesday to front-load passage of the human-rights defenders (HRDs) bill filed by detained Sen. Leila M. de Lima in a bid to “institutionalize and enforce state obligations for the protection of their rights.” Citing the increasing incidents of attacks against human-rights defenders under the Duterte administration, former senator and human-rights lawyer Rene Saguisag sought to enlist the backing of former colleagues in the Senate for early enactment into law of de Lima’s Senate Bill (SB) 1699. “Let us all support the bill at a time when a fellow Bedan prefers to kill pa more,” Saguisag said at a forum following the filing of the bill, referring to President Duterte, a San Beda College alumni like Saguisag. Saguisag added: “We need support from everybody who cares.” He said the human-rights community is “back at work” as he noted that “the situation is looking to be worse than the human-rights abuses inflicted by the Marcos dictatorship.” Advocates at the forum also cited reports that the pro-human rights group Karapatan has documented growing number cases involving attacks against human-rights defenders, amid findings that 84 human-rights defenders were killed, including 24 Karapatan members “doing field work documenting cases of human-rights violations.” De Lima’s SB 1699 was expected to be referred to the Committee on Justice and Human Rights, chaired by Sen. Richard J. Gordon, after its first reading during on Wednesday’s Senate plenary session.

A counterpart bill has been filed in the House of Representatives by Party-list Rep. Carlos T. Isagani Zarate of Bayan Muna. In filing SB 1699, de Lima stressed the need to establish an “effective legal remedy for the violation of the rights of HRDs.” She added that “the obsessive attacks against these [human rights] concepts and principles, led by no less than the President himself, have rendered us, human-rights defenders, vulnerable and our work extremely difficult and dangerous.” Moreover, de Lima recalled “how women human-rights defenders and activists in the lesbian, gay, bisexual and transgender community have become vulnerable not only to killings and harassment, but also to misogynistic attacks and sexual violence.” In a news statement read during a media briefing, de Lima said she found it “very urgent that we come forward and claim our right, as human-rights defenders, to be recognized and protected. Not for our personal sake, but for the sake of our dignity as a people.” At the same time, the senator denounced Duterte’s public declaration last year that he will order the shooting of human-rights workers as it “clearly places human-rights defenders under threat and encourages culture of impunity.” She lamented that “enforced disappearance, death, harassment, suppression of fundamental humanrights and freedoms are continuing challenges of individuals and the organizations to which they belong. This does not escape notice from outside the Philippines.” For instance, de Lima cited a March 2017 report of human-rights group Frontline Defenders, which

claimed that 15 HRDs working on various issues have been killed in a span of just three months. “Governments are often annoyed, defensive and hostile toward interventions of advocates, but that should not be the case,” she said. Once enacted into law, she added, Senate Bill 1699, to be known as the Human Rights Defenders Act of 2018, will mandate that “it is the government’s obligation to ensure protection of HRDs against intimidation and unlawful intrusion by any public or private individual.” De Lima’s bill provides it is also the responsibility of the government under the proposed measure to conduct investigation “whenever there is reasonable ground to believe that a human-rights defender has been killed, disappeared, tortured, illtreated, arbitrarily detained, threatened or subject to a violation of any of the rights…” “The state must ensure that a prompt, thorough, effective, independent and impartial investigation is conducted with due diligence and is prosecuted as appropriate,” she added. The measure, likewise, affirms the rights and freedoms of HRDs from defamation and harassment “in all forms of media and communication, and whether by public authorities or private actors, in association with his or her status, activities or work as a human-rights defender.” Under the bill, the Commission on Human Rights shall exercise the functions of a protection mechanism for all HRDs in accordance with its constitutional mandate, pertinent laws and guidelines, as well as standards governing the functions and responsibilities of a national human-rights institution.

Summer respite

With their catch in the bag, two young Zamboanga del Norte fishermen relish the calm of the sea and take a break after an overnight fishing trip. NONIE REYES

Dela Rosa elated, saddened by another PNP term extension By Rene Acosta

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@reneacostaBM

ATIONAL Police chief Director General Ronald M. dela Rosa welcomed on Wednesday his reported extension of term by President Duterte, even as he professed empathy to senior officers who have been candidates to succeed him. “I am sad for those [who are] very eager to replace me.… I am also very eager to exit and supposed to relax now, but the President is extending it. So, I could not refuse,” dela Rosa said. For the second time, Duterte extended the term of the police chief due to what dela Rosa said was the trust and confidence vested upon him by the Chief Executive, and for him to continue the Philippines National Police’s (PNP) internal cleansing and

the campaign against illegal drugs. “I enjoy his trust and confidence. He still needs me regarding scalawag policemen…this is the hardest battle, you are fighting those from within the organization,” dela Rosa said. “There are a lot there whom you thought, [who] just smile at you, but deep inside they are mad at you because you have stepped onto their schemes, their illegal business…being destroyed,” he added. Dela Rosa was supposed to have retired last month, but the President extended it for three months or until April, but which Duterte, this early, has decided to reextend. Under the law, the President can extend the term of the PNP chief for a maximum of one year, and, dela Rosa said, if Duterte will observe the maximum, he will retire

on January 21, 2019. “That’s with finality,” he said. The PNP chief said that while he enjoys the trust and confidence of the President, he could not speak for Duterte with regards to his possible successor. Dela Rosa said he trusts all the senior officers who have been named as candidates for his replacement. “If I will be asked, I have enough trust and confidence to the officers who are supposed to take over my post. I know them, they are good. They can do what I am doing now, but my view is different, the view of the President is different,” dela Rosa said. Dela Rosa said he expects that some officers would not be pleased with his extension, but still, he believes that police professionalism would be observed by the officers.

Economy

A4 Thursday, February 22, 2018 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

DOLE chief says OFW deployment ban to Kuwait stays until next month

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By Samuel P. Medenilla

@sam_medenilla

he Department of Labor and Employment (DOLE) on Wednesday said that the government is likely to extend the deployment ban of overseas Filipino workers (OFW) to Kuwait up to March until a new bilateral migrant workers’ pact is signed between the two countries. At a news briefing, Labor Secretary Silvestre H. Bello III announced the creation of a technical working group (TWG) tasked to negotiate and draft a new memorandum of agreement (MOU) between the Philippines and Kuwait. The TWG will be leaving for Kuwait on February 28. The MOU in question has already been pending for two years after the Kuwaiti government reportedly failed to act on its approval. Bello said the signing of the proposed agreement will be among their considerations for lifting the deployment restriction for newly hired Filipinos bound to Kuwait. “Once we sign it [the MOU], this may provide the safety valves that will protect our OFWs in Kuwait. And, as soon as we are assured of their safety, this may be a good reason to lift the total deployment ban. But I am not saying it is automatic,” Bello said. DOLE Undersecretary and TWG head Claro A. Arellano said they will be pushing for the inclusion of additional provisions on the MOU to further protect the welfare of OFWs in Kuwait. These provisions include allowing OFWs in Kuwait to use their cell phones and have their passports deposited at the Philippine Overseas Labor Office (Polo) or the Philippines embassy.

Many OFWs are unable to leave their abusive employers abroad, since their passports and cell phones are traditionally confiscated by most of their employers. “Hopefully, by next week, we will be able to finalize the memorandum of agreement so that, during the second week of March, there will already be a signing between the Kuwaiti government and Phi l ippine gover nment,” Arellano said. The DOLE said it is mulling over the same requirement for OFWs in other countries to extend the same level of protection, particularly with regards to their passports. “The passport is owned by the Philippine government. Their work permit is already enough for them to continue to roam and perform their business. Depositing the passport to the embassy or Polo is a prerogative of the worker and the government,” Labor Undersecretary Ciriaco A. Lagunzad III said. The DOLE imposed the total deployment ban to Kuwait on February 12 pursuant to an order issued by President Duterte. He ordered the ban and the repatriation of distressed OFWs from Kuwait following the recovery of the remains of a Filipina household service worker Joanna Demafelis from the freezer in her employers’ home earlier this month.

On Wednesday several OFWs, who were displaced because of the ban, approached Bello to appeal for the resumption of the deployment in Kuwait, but the labor chief maintained the ban is necessary for the protection of the over 200,000 OFWs in Kuwait. In response to the ban, the Kuwaiti government declared an amnesty program to allow thousands of “irregular” OFWs in their jurisdiction to be repatriated. The amnesty program was supposed to end today (February 22), but the Kuwaiti government opted to extend it until April 22. “We are satisfied with the reaction of the Kuwaiti government.... This is an indication that the decision of our President to declare a total deployment ban is working positively in our favor,” Bello said. Bello said that, initially, only 2,500 OFWs availed themselves of their repatriation program, but he said this has now grown to 6,000. Meanwhile, the DOLE also announced its “bold steps” to prevent other OFWs from the suffering the gruesome fate of Demafelis. Bello announced the creation of a centralized command center, which will be temporarily housed in the DOLE main office in Intramuros, Manila, that will address the processing of claims and complaints of OFWs. O verseas Workers Welfare Administration Administrator Hans J. Cacdac said the command center will be manned by personnel from the DOLE, Philippine Overseas Employment Admin-

istration (POEA) and OWWA. Cacdac said among the cases they are now monitoring is that of Norisa Manambit, reportedly in a comatose state in Kuwait. “We already instructed our welfare officer on site...to visit her in the hospital. As we speak, our OWWA office is traveling to the residence of the family to assure them of our assistance,” Cacdac said. Bello also deployed a team, headed by Lagunzad, to asses the status of the OFWs in Qatar, Kingdom of Saudi Arabia and Kuwait and further boost their protection. “We are planning to launch a Web-based alert system [in Kuwait] to give our citizens there to allow them to get help by pressing an alert button,” Lagunzad said. Bello also recalled that the current labor attaché and assistant labor attaché in Kuwait failed to promptly act on the case of Demafelis. “Remember, the sibling of Joanna reported she was missing as early as January 17, 2017. There was inaction from their part. They did not even report it to us,” Bello said. Bello also ordered the POEA to impose sanctions against 11 Philippine recruitment agencies, which were found guilty of “recruitment violations” in deploying OFWs to Kuwait. “We are sickened by the tragic fate that befell Joanna Demafelis.... This government is not taking this incident sitting down,” Bello said. “Today, we are giving more vigor to the campaign against trafficking, and we are declaring war against the abuse of our Filipino migrant heroes.”

We are satisfied with the reaction of the Kuwaiti government.... This is an indication that the decision of our President [Duterte] to declare a total deployment ban is working positively in our favor.”—Bello

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Cimatu urges manufacturers to pay their share in pollution

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nvironment Secretary Roy A. Cimatu sees the need for a law that would make manufacturers pay up for their share in polluting the environment. “Perhaps we must consider enacting laws that will make manufacturers pay at least part of the cost of cleaning up the nonbiodegradable packaging that they use,” Cimatu said at the Second Philippine Environment Summit (PES) in Cebu City on Tuesday. He raised the urgency for such a move, noting all sectors must help address the pollution problem nationwide. In 2017 the Department of Environment and Natural Resources (DENR) helped 321 local government units properly close and rehabilitate open and controlled dumps around Manila Bay, Cimatu said. But he said more needs to be done as pollution continues to plague the country. “Judging from the volume of plastic and other wastes that end up in our rivers, lakes and seas, we have not done enough,” Cimatu said. The National Solid Waste Management Commission said the country generates about 36 tons of waste daily. Metro Manila is the country’s top waste-generating region, and produces nearly 8,300 tons of waste per day, or about 3 million tons of waste per year, the commission said. Republic Act (RA) 9003, or the Ecological Solid Waste Management Act, refers to solid waste as “all discarded household, commercial waste, non-hazardous institutional and industrial waste, street sweepings, construction debris, agricultural waste and other nonhazardous/nontoxic solid waste.” A planned amendment to RA 9003 seeks to raise product stewardship among manufacturers nationwide to help minimize pollution from plastic packaging materials. Senate Environment Committee head Sen. Cynthia A. Villar believes RA 9003 must include

‘No illegal gas price increase after TRAIN’ By Lenie Lectura

FFW leaders to Duterte: Name ‘pro-worker’ chairman at SSC

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@llectura

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he Department of Energy (DOE) has cleared various gas stations that allegedly took advantage of the tax-reform law by selling old inventories at much higher prices. “Based on the documents that they submitted to us, ending January 31, it seems that they implemented their price increases because they were already using new stocks, meaning their old stocks had run out,” DOE Assistant Secretary Leonido Pulido III said. Still, the agency’s initial assessment would have to be verified. “Since the documents came from [oil firms], who will validate these? We based it on historical records, usually that’s not enough. But we wrote [to the] BIR [Bureau of Internal Revenue], which agreed to look into the documents’ authenticity,” Pulido said. Earlier, the agency said there are more than 20 various gas stations that took advantage of the tax-reform measure. A random inspection on all 6,800 gasoline stations were conducted to verify whether the excise tax under the Tax Reform for Acceleration and Inclusion (TRAIN) Act was properly imposed. With the additional excise tax, unleaded gasoline increased by about P2.97 per liter, while the price of diesel surged by P2.80 per liter. The implementation of excise tax and value-added tax for petroleum products under the TRAIN does not apply to the old stocks of petroleum products, including

provisions on extended producer responsibility (EPR), a stewardship-promoting solid-waste management approach, which makes manufacturers responsible for their goods even after selling these. “That’s part of amendments I’m planning for RA 9003,” she said at last month’s 2018 Zero Waste Month celebration and Fourth Eco-Waste Management Summit in Metro Manila. The EPR would include manufacturers’ recovery of sold goods’ discarded plastic packaging materials, so there would be less solid waste and pollution in the country, Villar stated. Cimatu hailed the conduct of the second PES, from February 20 to 22 this year. “I commend the organizers of this noble undertaking for their resolve to hold this event,” he said, referring to the DENR and environment group Green Convergence. PES showcases breakthroughs and advancements in environmental protection and sustainable development. Through PES, various sectors can share views on common challenges, collaborate on solutions and replicate success stories. “Mainstreaming Innovation for Sustainable Development” is the 2018 theme of PES, a biennial event. Green Convergence President Dr. Angelina Galang said this year’s PES focuses on local initiatives anchored on the triple bottom line concept that takes into account people, planet and profit to achieve business sustainability and profitability. Profit should not be business’ sole concern, she said. To be sustainable, Galang said, a business must also consider its social responsibility and environmental impact. She added sustainable business operations do not deplete natural resources and instead enable present and future generations to avail themselves of their goods and services. PNA

TRAIN effect

A lady store crew arranges stocks at the beverage station of a supermarket chain in Makati City early this week. Reports indicate that inflation will likely continue to rise until June, which is still an aftereffect of the tax reform implemented early this year. ALYSA SALEN

their stocks under the 15-day minimum inventory requirement. 
 
Consequently, the retailers should not charge the new excise tax to the consumers. The DOE told the oil companies to submit a daily summary of stock withdrawals starting on January 1 until the depletion of the declared inventory as of end-2017. The Senate Committee on Energy had said it wants to put in place mechanisms to monitor the levels of supply of petroleum products, including the imposition of stricter penalties for late and incorrect inventory submissions of oil companies, as well as for the

negligence on the part of government agencies to monitor price movements. “I can foresee that we need to penalize oil companies if they don’t submit their inventories on time or if they give incomplete or inaccurate information about their stock levels. With or without the additional excise taxes from the TR AIN Law, these companies are still duty-bound to submit their monthly inventories. And the DOE should be on top in ensuring their compliance,” Sen. Sherwin T. Gatchalian said. Under Section 14 of the oil deregulation law (RA 8479), the DOE is mandated to maintain a periodic schedule of pres-

ent and future total inventory of petroleum products in the country. Because of this, oil companies are required to submit a monthly report that details their sales and consumption levels, actual and projected importations and inventory of oil products. “So, even if oil companies and gas stations already raise prices using their new supply in accordance to [the] TR AIN, they would still have to be audited by the DOE and determine whether they unduly increased their prices without any clear basis, in which case they will have to face the appropriate penalties and fines,” Gatchalian added.

By Nelson S. Badilla | Correspondent

HE Federation of Free Workers (FFW) has expressed hope that President Duterte will appoint a leader of the Social Security Commission (SSC) “who truly understands and represents the interest of the working class.” Jose Sonny G. Matula, FFW president, told the BusinessMirror that the chairman of the SSC should also conduct regular consultations with the leaders of “true” labor groups like the FFW, which, he claims, has 250 workers’ unions. SSC is the highest policy-making body of the Social Security System (SSS). Matula aired FFW’s position after the career of Dean Amado D. Valdez and Jose Gabriel M. La Viña at the SSC was terminated by Duterte. Valdez was appointed SSC chairman in October 2016, and his term ended in June 2017. The President appointed La Viña as SSC commissioner in 2016, and his term, likewise, ended in 2017. Matula said that the FFW is hoping that Duterte will appoint a chairman who would really decide and act on behalf of the workers’ interests and benefits, since the SSS was established to ensure that the government has an agency that will focus on the workers’ financial needs for health, calamity and death, among others. Allan Montaño, a labor lawyer and currently president of the Philippine Association of Voluntary Arbitrators Inc., concurred with Matula. Montaño, a former FFW president, explained that the “SSS’s mandate is to provide social protection. Although tripartite in character, the overwhelming membership of SSS came from the labor sector. Logic, if not moral compulsion, requires that its leader should be pro-labor,” he said. “[T]he said leader should think and think on how to improve and strengthen a sustainable package of benefits to its members as, indeed, a truly social protection measure to fulfill its mandate,” Montaño added.

Agriculture/ Commodities BusinessMirror

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Editor: Jennifer A. Ng • Thursday, February 22, 2018

DA to sell ₧38/kilo rice in Metro Manila

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By Jasper Emmanuel Y. Arcalas

@jearcalas

he Department of Agriculture (DA) will deploy mobile stores that will sell commercial rice at P38 per kilogram (kg) in Manila and Quezon City as part of government efforts to stabilize the price of the staple. “Starting Monday, two trucks of the DA loaded with at least 1,000 bags of rice in 5 and 10 kilo packs will be deployed to poor neighborhoods in Metro Manila to sell rice at P38 per kg,” Agriculture Secretary Emmanuel F. Piñol said in his Facebook page on February 21. Piñol said this is an expansion of the DA’s Bigas ng Masa TienDA program, which was launched last week. “Agriculture Undersecretary for Agribusiness and Marketing Bernadette Romulo-Puyat will oversee the expanded operations of the Bigas ng Masa TienDA, which aims to directly link farmers to the consumers and bring down the prices of basic food commodities like rice,” he added. Piñol said two trucks would be deployed in Tondo in Manila and Payatas in Quezon City. “The Bigas ng Masa TienDA is an advocacy program of the agriculture department, which aims to connect farmers directly with the consumers to bring down the prices of food commodities,” he said. “While freshly harvested commercial rice is being sold in the market for as high as P50 per kg to P60 per kg, the Bigas ng Masa TienDA will maintain a selling price of P38 per

kg,” he added. Citing a study conducted by DA, Piñol said the retail price of rice should only be double the farm-gate price of paddy. “If farmers’ palay is bought at P20 kg, the selling price of rice should not be more than P40 per kg.” “The layers and tiers of middlemen and traders who make profits as the supply moves from the farms to the markets, however, have resulted in very high prices of basic food commodities,” Piñol added. The agriculture chief also said the DA would expand its Bigas ng Masa program in the provinces to give poor families an access to “fairly priced” rice and farm products. “The Bigas ng Masa TienDA will soon be offered in the regional offices of the DA in outlets to be operated by farmers themselves with the help of agriculture workers,” he said. “From the regions, the Bigas ng Masa TienDA outlets will also be opened in the different municipalities to provide the poor access to fairly priced farm products,” Piñol added. The DA chief said rice farmers belonging to the Star Capalay Association of Nueva Ecija committed to support the department’s Bigas ng Masa program by supplying it with 500 25-kilogram bags of rice weekly.

We need a food revolution to change our unhealthy diets

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all me dilawan, but I still believe in celebrating the 1986 Edsa Revolution if only because it shows how Filipinos have the capacity to demand for change and oust a despotic leader. I have other reasons, too, but that is more suitable for another (and more political) column. What I want to focus on is the need for another revolution—a food revolution that can change our eating habits and how we view individual diet, health and the environment. Of course my proposed food revolution is a riff on Jamie Oliver’s campaign to serve more healthy food in school cafeterias. But while the celebrity British chef focused his campaign on the United States and the United Kingdom, I believe that we need such campaign given that more and more Pinoy kids (and adults) are indulging on fast food and junk food. And this is based not only on my personal observation of my 11-year-old nephew’s eating habits but also on the data presented by the Food and Nutrition Research Institute (FNRI) at last week’s briefing organized by Greenpeace. The FNRI said Filipinos’ intake of fruits and vegetable is declining, while our consumption of meat and eggs is increasing. Combined per capita consumption of fruits and vegetables of Filipinos is 155 grams, less than half of the 400 grams per day recommendation of the World Health Organization. The FNRI conducts a nutrition survey every year, and data from 1978 to 2013 have shown how we are eating more rice and meat, while cutting down on fish, fruits and vegetables. In 1978 our per capita consumption of cereals was at 367 grams. This rose to 387 grams in 2013. Similarly, per capita consumption of meat increased from 23 grams in 1978 to 58 grams in 2013, while that of eggs rose from 8 grams to 17 grams. In contrast, per capita consumption of vegetables declined from 145 grams to 114 grams and fruits from 104 grams to 41 grams. But the FNRI data is only part of a bigger report issued by the National Nutrition Council (NNC) in July 2017. According to NNC’s Talking Points, 7 in 10 Filipino households do not meet their dietary energy requirement and that only a small proportion of households met the estimated average requirement for certain nutrients, such as vitamin A, riboflavin, vitamin C and thiamine. The NNC has, likewise, cited several studies that showed the Filipinos’ increasing preference for softdrinks and fast food. The Global School-based Student Health Survey conducted in the Philippines in 2011 revealed that more than 40 percent of students aged 13 to 15 who participated in the survey usually drank carbonated soft drinks one or more times per day during the past 30 days. The Nielsen Shopper Trends Report in 2014 showed that compared to 2012, there was a 13-percent decline in the Filipinos’ monthly grocery spending, with 25 percent of consumers eating at fast-food restaurants at least once a week. Nielsen’s 2016 Global Ingredient and Out-of-Home Dining Trends Report also showed that more Pinoys were buying ice cream and salty snacks. You don’t need a nutritionist to know that such diet—heavy on carbs, salt and sugar and low in fiber content—is not healthy. But what makes it worse is its huge impact on the environment. In fact, this is why Greenpeace launched the “Diet for Climate” campaign last week—and onboard its iconic Rainbow Warrior ship no less. The briefing, which ended with a vegetarian buffet that includes, among others, brown rice, chop suey and unsweetened cucumber juice, featured speakers from the FNRI and Greenpeace discussing how the food we eat contributes to a high carbon footprint and promotes unsustainable farming and food manufacturing practices. “Unfortunately, for a country highly vulnerable to the impacts of climate change, this shift in eating habits

Prime Sarmiento

prime commodities contributes to increasing industrial livestock production, which, in turn, leads to increasing GHG [greenhouse gas] emissions. Livestock is one of the major sources of GHG emission in the Philippines’s agriculture sector, second only to rice. In the 1994 GHG inventory, total emission from domestic livestock accounted for 32 percent of the country’s total GHG emission,” Greenpeace said in a statement issued at the briefing. But what to me the interesting part of the NNC report is the fact that we are passing on this unhealthy (and environmentally destructive) diet to our children. And these children will pass this kind of diet to their future children (and grandchildren) because that’s how they were raised. I know that for a fact because my diabetic parents (and grandparents) passed on their fondness for sweets, de lata and rich Pinoy fiesta food like karekare to me (and my siblings). Compounding the problem was the rise of fast-food restaurants in the 1980s and those cloyingly sweet imported chocolates that my father bought overseas. My siblings and I will eventually become more health conscious as have seen how our parents had to rely on medicines just to keep diabetes at bay. I, for one, was once a major kill joy who nagged my parents to eat brown rice and veggies. In fairness, they have listened to me. On the other hand, I have also stopped nagging because I chose to have a peace of mind. But there’s more to a healthy and eco-friendly diet than willpower and personal choice. NNC’s Talking Points quoted a 2006 study, which said that the changes in the dietary patterns of Filipinos can be attributed to several factors, such as increasing urbanization that favored a diet high in fat and refined carbohydrates; trade liberalization that made more processed food and fast food available and the influence of mass media. “Aggressive marketing could also be a culprit. Marketing of unhealthy foods near schools is rampant based on a study conducted by UP Manila. The study showed that 85 percent of foods with outdoor advertisement fell into the unhealthy foods classification and most marketed food and beverages were softdrinks, energy drinks, alcoholic beverages and other sugar-sweetened drinks,” NNC said. So the problem, it seems, is systemic. I, for one, think that one of the ways to reduce the consumption of fast food is to limit the marketing of fast food to children. It’s pointless for parents to ban their kids from going to fast food outlets if these children are bombarded every day by ads from TV, radio and online. Of course we can also ban our kids from watching TV or accessing the Internet but I don’t know what will be the consequence of such strict parental supervision on a child. Since I’m not a parent, I will leave it up to you moms and dads out there if this is in fact an effective parenting style. I’m also in favor of the taxing of sugar-sweetened drinks, as outlined in the first package of the Tax Reform for Acceleration and Inclusion (TRAIN), believing that this will reduce the consumption of softdrinks and other drinks sweetened by that unhealthy (and also not eco-friendly) high fructose corn syrup. The sugar tax is something that I want to discuss in my future column. But for now, I’m hoping that the revenues derived from the sugar tax will be used to subsidize healthier food alternatives such as organic food.

TheBroa DOST: ADVANCING SC AGENDA BEST OPTION A6

Business

Thursday, February 22, 2018

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By Alladin S. Diega | Correspondent

N a recent meeting with members of the Makati Business Club and several foreign chambers of commerce, the government’s chief scientist Fortunato dela Peña encouraged local and foreign businessmen to invest in technologyrelated enterprises. Dela Peña, Secretary of the Department of Science and Technology (DOST), said this is relevant as the government is now investing heavily in science and technology. The chief scientist cited advancement in health and medicine development with the county’s numerous traditional medicinal herbs as focus, education, energy, disaster resiliency, and climatechange adaptation, including enterprises that deal with creativity such as designs. A civil servant for two decades now holding various teaching and civil-service positions up to his appointment as top official of the DOST under the present administration, Dela Peña said that for a time, the country seemed to have grown “resistant” to science- and technology-related endeavors, although a core number of advocates persisted in pushing the science agenda. The progressive minds seemed to have prevailed, the DOST official said. Recently, the Philippines ranked 73rd out of 128 economies in terms of Science and Technology and Innovation (STI) index, citing the country’s strength in research and commercialization of STI ideas. The report also said that 60 percent of companies in the country offer training to improve the technical skill of their employees.

Investment

HOWEVER, a study by the Philippine Institute for Development Studies highlighted the weak ties between innovation-driven firms and the government, and it also identified the country’s low expenditure in research and development (R&D). According to Dela Peña, this is the reason the government is now extending all its efforts to reach out with the private sector, explaining that STI plays an important role in economic and social progress and is a key driver for a long-term growth of an economy. Technology adoption, the official said, allows a country’s firms and citizens to benefit from innovations created in other countries, and allows it to catch up and even leap-frog obsolete technologies. This can lead to significant improvements in productivity for existing firms in agriculture, industry and services. For one, long-term investments in building local capacity for technology generation can lead to innovations that will give local firms a competitive advantage. This can result in the creation of new firms and even entirely new industries. For another, the local medicine sector has been showing potential, the DOST official said, citing the case of two dozen local herbs or medicinal plants being

studied as one example.

Lagundi

WHEN asked about the case of Lagundi (Vitex negundo), whose efficacy as medicine is being challenged by drug manufacturers, DOST Assistant Secretary for International Cooperation Leah J. Buendia said that the shrub was subjected to 20 years of stringent clinical trials and has been proven consistently as effective. “But since the DOST, and the government for that matter, is not into commercialization, private companies are the ones who manufacture the component of the medicinal plant into commercially available medicines,” Buendia said, adding that the agency only gives the results which include the right formula and volume of the medicinal component. Asked on the possibility that private manufacturers might knowingly dilute the required strength for the medicine to be effective to cut cost and unwittingly made the medicine commercially available ineffective, the official declined to comment. She, however, assured that the private sector is working with the agency for the purpose of commercializing discoveries made and studied by the DOST in partnership with the private sector, as these “products would not help private companies profit but advance the country’s agenda.” The science agenda that, despite advances, is still in need of prioritization and more funding. This agenda is in the Philippine Development Plan 2017-2022, which devotes an entire chapter on STI.

STI culture

RECENT positive developments and advancement in science and technology notwithstanding, there remains a low level of innovation in the country. This is brought by weaknesses in STI human capital, low R&D expenditure and weak linkages in the STI ecosystem. In the Global Innovation Index (GII) Report last year, the Philippines ranked 74th among 128 economies in terms of overall innovation, garnering a score of 31.8 out of 100. This is a slight improvement from the score of 31.1, ranking 83rd out of 141 economies in 2015. The country also ranked fifth out of seven members of the Association of Southeast Asian Nations (Asean) that were included in the survey. The Philippines was ahead of Cambodia (95th) and Indonesia (88th) but lagged behind Singapore (6th), Malaysia (35th), Thai-

land (52nd) and Vietnam (59th). The factors behind the weak performance of the STI sector include a weak STI culture, Dela Peña said. There is lack of public awareness and interest in STI and many sectors do not recognize, appreciate and understand the use of technology- and science-based information in their daily activities. There’s also a number of weaknesses in social and professional culture, i.e., research culture in universities, commercialization of results from public research, among others. According to Dela Peña, a lack of awareness on intellectual property rights, in the research community and the general public, still persists. Despite its availability, adoption and application of technologies among micro, small and medium enterprises (MSMEs) and sectors like agriculture and fisheries remains low, he added.

Research

LOW government and private spending on STI is another factor behind the weak performance of the STI sector, according to the GII report. Investments in R&D are central for enhancing the country’s

innovation ecosystem, the report said. Expenditures on R&D and innovation activities, as well as the support given to the development of human resources in various fields of science and technology (S&T), are the parameters scrutinized in the monitoring and evaluation of STI. While nominal R&D expenditures increased by 80 percent to P15.92 billion in 2013, the proportion of R&D spending to GDP stood at only 0.14 percent. This is substantially below the 1-percent benchmark recommended by the United Nations Educational, Scientific and Cultural Organization (Unesco) and the global average of 2.04 percent. It is also low compared to other Asean countries, such as Vietnam, 0.19 percent, Thailand with 0.36 percent, Malaysia with 1.09 and Singapore’s 2.0 percent. The data is available online from Unesco’s Institute for Statistics. The country’s relatively low ranking in the GII Report was pulled down by weaknesses in human capital and R&D, with a score of 22.7 out of 100, ranking 95th. This is due to the low public and private expenditures on education and R&D, as well as low tertiary inbound mobility. Tertia-

ry inbound mobility refers to the number of students from abroad studying in a given country, as a percentage of the total tertiary or college enrollment. The bulk of the R&D spending, about 60 percent, comes from the public sector. These were directed to agricultural and industrial production and technology, protection and improvement of human health, control and care of the environment, among others. Most of the R&D activities in the country are still concentrated in the National Capital Region, Calabarzon and Central Luzon.

Manpower

ANOTHER indicator measuring the capacity for technology generation is the number of S&T human resources engaged in R&D. As of 2013, the country has a total of 36,517 R&D personnel, of which 26,495 are key researchers, scientific, technological and engineering personnel engaged in R&D; the rest are technicians and support personnel. The figures denote that there are only 270 researchers for every one million Filipinos. Such ratio falls short of the Unesco norm of 380 per million population and the 1,020 researchers per million

population average across developing economies of East Asia and the Pacific. Of the total researchers in the country from the government, higher educational institutions (HEIs) and private nonprofit sectors, 14 percent had doctoral degrees (PhD), 38 percent had master’s degrees, while 34 percent had Bachelor of Science (BS) up to postBS degrees. The low number of researchers in the country reflects the propensity of the educational system in the country to produce graduates outside of science, technology, engineering and mathematics, or STEM, programs—the disciplines where R&D flourishes. Nevertheless, the latest GII report indicates that in terms of graduates in science and engineering, the country garnered a score of 25.5 out of 100, ranking 26th.

Capital

AN assessment of the country’s innovation system conducted by a program of the United States Agency for International Development (USAID) reveals that the supply of STEM graduates exceeds local demand. As a result, there is an outmigration and, worse, underemployment of many skilled, locally

aderLook

sMirror

www.businessmirror.com.ph | Thursday, February 22, 2018

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CIENCE, TECHNOLOGY N FOR PHL GROWTH

LEREMY | DREAMSTIME.COM

Ecosystem

The brain drain contributes to the problem as potential researchers, scientists and engineers, the key actors for the innovation ecosystem to flourish, prefer to seek employment overseas due to better economic opportunities and potential for advancement. Since knowledge and technology are mostly embodied in human resources, this emphasizes the urgency to accelerate the development of R&D human resource. trained scientists and engineers. The report by the USAID’s Science, Technology, Research and Innovation for Development, or STRIDE, program also cited a shortage in training for fields critical for innovation, particularly in information technology. Such shortage contributes to the challenge that many local companies face, especially in securing employees with the skills required to grow the business. This somewhat explains the nature of brain drain the country has. It is not so much because of Filipinos not being “nationalistic” but simply because there is limited opportunity for people of science to stay in the country.

However, Buendia said the issue of nationalism has some credence, if not the absolute answer, citing the case of South Korea in the 1950s. When South Korea was in its lowest in terms of economic level, the government called on all its scientists and engineers scattered around the world to go home and help build their economy, and many responded, she said. According to Buendia, this brain drain contributes to the problem as potential researchers, scientists and engineers, the key actors for the innovation ecosystem to flourish, prefer to seek employment overseas due to better eco-

nomic opportunities and potential for advancement. Since knowledge and technology are mostly embodied in human resources, this emphasizes the urgency to accelerate the development of R&D human resource.

Patents

THE output of R&D is commonly measured in terms of patents applied and granted to Filipino residents. However, reports show that many universities do not have the expertise to market their patent portfolios for commercial use. Furthermore, technology generators face persisting issues on technol-

ogy ownership while researchers are constrained by the “publish or perish” phenomenon. This results in the weak technology transfer system in the country. An annual average of 209 patent utility models and 597 industrial design applications were filed from 2005 to 2015. In the same period, an annual average of 54 patents, 446 utility models and 502 industrial designs were granted. In 2016, the World Economic Forum (WEF) ranked the Philippines 86th out of 128 economies for the number of patents filed under the Patent Cooperation Treaty per million population. Invention patents granted to local inventors represent the smallest share in number of intellectual properties granted from 2001 to 2003. Industrial design and utility models consistently comprise the majority of the intellectual property granted. The country also needs to catch up in research publications since the number of scientific publication in peer-reviewed journals per million population stands at 55, substantially below that of Asean member-states like Singapore with its staggering 10,368, Malaysia with 1,484, Thailand with 478 and Vietnam with 105.

ANOTHER factor behind the weak performance of the STI sector is the weak linkages among players in the STI ecosystem. The 2009 survey of Innovation Activities and the 2014 USAIDSTRIDE Assessment of the Philippine Innovation Ecosystem discovered that innovation actors have weak cooperation, partnerships and trust among themselves. Most HEIs perceive collaboration with companies as outside of their core missions and a risk to exploitation. Consequently, firms report that difficulties in convincing HEIs of their shared interests stem from resentment, suspicion and distrust. In effect, firms end up with little technical assistance from the government and research institutions. Another factor in this equation is restrictive regulations that hamper implementation of R&D programs and projects. The tedious government procurement process hobbles the immediate procurement of equipment and other needed materials for research, which, in turn, delays the implementation of R&D projects, the GII report said. This was confirmed by the USAID-STRIDE study, which revealed that restrictive regulations make the procurement of equipment and consumables for research extremely slow and unnecessarily complex, decreasing research productivity, publication potential, and speedto-market of innovation. In addition, the report said the government research grants do not compensate universities for the salary of faculty members’ research activities. This practice is rarely seen outside the Philippines. The final factor in the weak performance of the STI sector is inadequacy of an STI infrastructure that includes laboratory facilities, testing facilities and R&D centers. Many existing hubs need upgrading to improve their services, which contributes to the lack of absorptive capacity in research institutions, the USAID-STRIDE report said. It also cited that the public institutions failed to provide young researchers with equipment packages, particularly those returning from PhD studies abroad with more advanced research agendas. The country’s leading research institutions also remain concentrated in Luzon.

Hopes

DESPITE the many inadequacies, from funding to human capital, there are some technology-intensive research and capacity-building projects which resulted in products which are currently being used successfully. One is the micro-satellite. In April 2016, the country launched into space its first micro-satellite called Diwata-1. It was designed, developed and assembled by Filipino researchers and engineers under the guidance of Japanese experts. The Diwata (deity in English) satellite provides real-time, high-resolution and multi-color infrared images for various applications, including meteorological imaging, crop and ocean productivity measurement and high-resolution imaging of natural and man-made features. It enables a more precise estimate of the country’s agricultural production, provides images of watersheds and floodplains for a better understanding of water available for irrigation, power and domestic consumption. The satellite also provides accurate information on any disturbance and degradation of forest and upland areas. The country also has the Na-

tionwide Operational Assessment of Hazards (NOAH), which uses the Lidar (light detection and ranging) technology. Project NOAH was initiated in June 2012 to help manage risks associated with natural hazards and disasters. The project developed hydromet sensors and high-resolution geo-hazard maps, which were generated by light detection and ranging technology for flood modeling. NOAH helps the government in providing timely warning with a lead time of at least six hours in the wake of impending floods. According to Buendia, the country is now training the Cambodians on this technology, as part of the partnerships among Asean countries, just like in the case of Japan which assisted the country’s scientists and engineers in building its first micro-satellite. Another hope lies in the socalled Intelligent Operation Center Platform. Established through a collaboration between the local government of Davao City and IBM Philippines Inc., the center resulted in the creation of a dashboard that allows authorized government agencies, such as police, fire and anti-terrorism task force, to use analytics software for monitoring events and operations in real time.

Initiatives

THE DOST, in cooperation with HEIs and research institutions, established advanced facilities that seek to spur R&D activities and provide MSMEs access to testing services needed to increase their productivity and competitive advantage. One is the Advanced Device and Materials Testing Laboratories. The center houses advanced equipment for failure analysis and materials characterization to address advanced analytical needs for quality control, materials identification and R&D. Closely related to this facility is the Electronics Products Development Center, used to design, develop and test hardware and software for electronic products. There are also high-performance computing facilities that perform tests and run computationally intensive applications for numerical weather prediction, climate modeling, as well as analytics and data modeling and archiving. The Philippines could also boast of its Genome Center, a core facility that combines basic and applied research for the development of health diagnostics, therapeutics, DNA forensics and preventive products, and improved crop varieties. According to Buendia, the country also has drug-discovery facilities, which address the requirements for producing high-quality and globally acceptable drug candidates. She said the Philippines also has nanotechnology centers, which provide technical services and enabling environment for interdisciplinary and collaborative R&D in various nanotechnology applications. Buendia said there are also radiation processing facilities that are used to degrade, graft, or crosslink polymers, monomers, or chemical compounds for industrial, agricultural, environmental and medical applications. The Philippines could also boast of its Die and Mold Solutions Center, which enhances the competitiveness of the local tool and die sector through the localization of currently imported dies and molds. These reflect that we are advancing, albeit slowly, to a culture that embraces STI as a sure path to growth, according to Dela Peña.

Banking&Finance

A8 Thursday, February 22, 2018 • Editor: Jun B. Vallecera

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Legislators assures tax-neutral treatment for Islamic lenders

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By Jovee Marie N. dela Cruz @joveemarie

he House of Representatives is crafting legislation authorizing the revenue agency to make adjustments ensuring zero-tax impact on financial transactions conducted by Islamic lenders and, in this manner, help boost what little Islamic banking is happening in the country.

There is an unnumbered substitute bill that recognizes the role of Islamic banking and finance in generating opportunities for greater financial inclu-

sion among Filipinos, especially for the underserved Muslim population. At the public hearing conducted by the House Committee on Banks on Tuesday,

legislators zeroed in on Section 14 of the proposal providing neutral tax treatment on Islamic banking products. The proposal is for the Bureau of Internal Revenue (BIR) to implement taxneutral policies and guidelines helping make possible the growth of Islamic banking and finance in the country. The BIR is given the power to modify applicable taxes on Islamic banking transactions. Party-list Rep. Amihilda J. Sangcopan of Anak Mindanao, one of the principal authors, said, “The nature of Islamic banking transactions is that if you don’t apply tax neutrality, it would entail the client double taxation.” Bangko Sentral ng Pilipinas (BSP) Of f icer-in- C ha rge Rosi l io O. Prado ac k nowledged t he uneven compet itive field facing Islamic banks in the Philippines relative to their conventional banking colleagues. Sangcopan claimed a real-estate loan

from a conventional bank will have the bank provide the money so the client can purchase the land. In contrast, a real-estate loan from an Islamic bank has two legs. The bank will first purchase the land and then resell it to the client. This entails a higher cost for the Islamic transaction compared to that of a regular commercial bank. Sangcopan reminded the BIR and the BSP that Islamic banking is part of the country’s commitment to the Asean economic blueprint. She also said only Laos PDR and the Philippines do not have Islamic banking provisions that promote Sharia-compliant lending like the other members of the Asean. Sangcopan said Islamic finance is a $2. 5 -t r i l l ion business dom inated by Malaysia, which owns 64 percent of the global sukuk or Sharia-complia nt bond ma rket worldw ide. T here

are a lso more than 60 Shar ia-compliant bonds traded at the Philippine Stock Exchange. “Undeniably, it has evolved from a faith-based economic system with clear rules to that of an emerging global industry,” she added. There are now more than 30 Islamic financial institutions operating in over 75 countries. “The Philippines, then, has to address its own challenges by making major changes in terms of regulatory framework and the reintroduction of taxes and incentives. The Philippines is, in fact, a pioneer in Islamic finance,” Sangcopan said. According to the lawmaker, the stateowned Al-Amanah Islamic Investment Bank is one of the oldest Islamic banks in the world, established in 1974, and has expanded operations in Cagayan de Oro, Cotabato, Davao, General Santos, Iligan, Marawi, Zamboanga, Jolo and Makati.

Central banks may top inflation targets ‘Higher disposable income does not mean more spending’ N By Bianca Cuaresma @BcuaresmaBM

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lthough the recently enacted taxreform law promises a higher takehome pay for Filipinos, there remains apprehension over the moderation in domestic consumption as prices rose higher than projected in January. In reviewing the Tax Reform for Acceleration and Inclusion (TR AIN) Act, ANZ Bank economist Eugenia Victorino said the accelerated inf lation traced to the tax-reform program was likely to curb consumption activities in the months going forward. Private consumption has proven a resilient and consistent growth driver for the Philippines and has helped push the economy to growth above 6 percent in recent years. “While take-home pay is higher for taxpayers, non-taxpayers are facing higher prices,” according to Victorino. “In the past, for every 1-percent increase in headline prices there was a corresponding decrease in private consumption by 0.3 percent,” the economist said. He particularly cited the surge in both headline and core inflation following the taxreform adoption in January. Data showing inflation of 4 percent in January shocked markets, as this sat at the upper limit of the 2-percent to 4-percent target for the year.

Interestingly enough, the BSP acknowledged inflation would likely push beyond the target range for the year at 4.3 percent. “We expect inflation at 4.1 percent in 2018 and 3.4 percent in 2019. If realized, it would be the first inflation overshoot since 2008,” the ANZ economist said. In 2017 inflation averaged 3.2 percent— well within the 2-percent to 4-percent target despite the higher inflation trend in the closing months. Victorino also argued that surging inflation in January was influenced by factors “ beyond tax adjustments.” “While the tax reform had a direct effect on selected items, the rate of increase in core prices suggested that some of the secondround effects of the tax reform had already filtered through. Transport accounts for 7.8 percent of the CPI [consumer price index] basket, while electricity takes 4.5 percent. Nonalcoholic beverages account for 2.7 percent, while tobacco takes 1 percent,” the economist said. At the moment, the Bangko Sentral ng Pilipinas keeps close to its chest whether future monetary-policy adjustments require a tightening to address rising inflation concerns, saying the second-round impact of the tax-reform law “appear to be well contained”.

ot only will central banks meet their inf lation targets, they may even exceed them. That’s the view of Neuberger Berman Group Llc.’s chief investment of f icer for f i xed income, Brad Tank, who says rising inf lation and interest rates mean the retur n of market volati lit y recently is something investors need to get used to. “We are now in a transition from

Case clippings

By Justice S J Ranada Jr. LAWYERS–filing of cases against adverse counsel Professional rules impose limits on a lawyer’s zeal in defending his client’s cause, with necessary restrictions and qualifications. The filing of cases by a lawyer against the adverse parties and their counsels manifests his malice in paralyzing the lawyers from exerting their utmost efforts in protecting their client’s interest. Even assuming arguendo that such acts were done without malice, it showed said lawyer’s gross indiscretion as a colleague in the legal profession. Alpajora v. Calayan 10 Jan. 2018

Association member personas

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n last week’s column, I talked about the term “Ikea effect,” which I got from the seminar on association marketing and member engagement conducted by my organization, the Philippine Council of Associations and Association Executives (PCA AE) and presented by Arianna Rehak, director at AssociationSuccess.org, a US-based digital publication and online community for association professionals. This time, I wish to introduce you to the term “member personas,” which Arianna also brought up during her presentation. “Member personas are fictional, generalized representations of your ideal members. They help you understand your current and prospective members better, and make it easier for you to tailor to the specific needs, behaviors and concerns of different groups,” she said. If bankers are familiar with the “KYC” (know your customer) principle, the equivalent for associations would be “KYM” (know your members). So, essentially, member personas is the latest phrase for an age-old marketing principle: know your target market and deliver what’s relevant and delightful to them. By understanding your members’ roles and responsibilities, motivations and drivers, you can create meaningful dialogue and appropriate service offerings that advance their profession or trade, as well as provide solutions to pressing problems and challenges: a wish list that members expect to benefit from in joining an association.

Association World Octavio Peralta According to Arianna, member personas are created through research, surveys and interviews with members. Here are some ways to build it up: a. Interview members, either in person or on the phone; b. Look at your contact database to uncover trends; c. When creating forms, use form fields that capture important persona information; d. Peruse their social-media profiles; e. Take into consideration your personal experiences with members; and f. Aim for two to three personas at a time. More specifically, in conducting a survey or research, she mentioned that you may wish to consider the following factors: n Background: Job? Career path? Family? n Demographics: Male? Female? Age? Location? n Identifiers: Communication preferences? Demeanor? Social-media channels? n Goals: Primary or secondary goal?

an environment in which inf lation clearly was not meeting central bank targets to one in which inf lation will meet those targets— but could also exceed them,” Tank wrote in a report dated February 18 from the firm, which manages $295 billion. With inf lation still under control and well below targets at central banks in the United States, Japan and Europe, there are now reasons to indicate its return isn’t far

n Challenges: Primary or secondary challenge? What can your association do: to help members achieve their goals and help them overcome their challenges? How might the association communicate with its members based on their identified traits? Having all these information will provide your association a clearer and more targeted approach to your service programming. You can now specifically define your membership (trade association, professional society or hybrid) and segmentize accordingly. You can also develop a member-scoring tool to group your members. It is known that highly engaged members are likely to be potential buyers of value-added member benefits. Once you have all these member information, it may be prudent for you to document them in either Word or Excel spreadsheet, and create an infographic to have a sense of the types of members that comprise the personas you have collected. Finally, you can put your personas to work by delivering more relevant and useful content to your members. So act now and develop your member personas! The column contributor, Octavio “Bobby” Peralta, is concurrently the secretary-general of the Association of Development Financing Institutions in Asia and the Pacific (ADFIAP) and CEO of the Philippine Council of Associations and Association Executives. PCAAE enjoys the support of ADFIAP, the Tourism Promotions Board, and the Philippine International Convention Center. E-mail: obp@adfiap.org.

AC 8208 Gesmundo, J

off after its absence confounded strategists and, indeed, the Fed for much of last year. The International Monetary Fund predicts a global economic expansion of 3.9 percent this year and the next, which would be the fastest since 2011. A p r o no u n c e d s e l l - o f f i n US gover n ment bond s si nce September—an almost 1-percentage-point increase in the yield on the 10-year Treasury notes—spilled over to equity markets this month as a measure of stock-market volatility soared. The Cboe Volatility Index, known as the VIX, remains at 21, almost 50 percent higher than the average over the past five years going into 2018. “The shift to higher volatility is structural, not temporary, and directly related to expectations for higher inf lation and higher interest rates,” Tank wrote in the report. The worry for equity investors would be if policy-makers react too slowly to rising price pressures in the economy, forcing them to ratchet up rates more quickly in a bid to contain spiraling inf lation and choking off growth, he said. Bloomberg News

BSP willing to pay even more for term deposits

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he Bangko Sentral ng Pilipinas (BSP) has indicated greater willingness to pay the banks more this week than last so long as they entrust their so-called excess liquidity at the term deposit window created for the purpose. Data show all three tenors posting markedly higher, and by extension more expensive, rates this week at volumes also markedly higher than previous, indicating overwhelming interest on the part of bidders, the banks. Data from the BSP showed all short-, medium- and long-term special deposits were oversubscribed, the second consecutive week when all three had more bids than offers. Strong demand was seen in 28-day term deposits that had a bid coverage ratio of 1.5178. This means the volume of bids covered 151.78 percent of the amount offered by the BSP. Bids for t he 28 - d ay faci l it y hit P30.355 billion on Wednesday, overwhelming the P20-billion offering for the day. T he longer term-deposit facilit y (TDF) had earlier been zeroed out due to lack of demand. It was only offered again in February 7 after a seven-week hiatus. It posted oversubscriptions since. The new medium-term TDF—introduced only last week—had a bidcover ratio of 1.1691 this week, as it attracted tenders worth P46.765 billion, or more than enough to cover the

P40-billion offer. The demand for the new term TDF ramped up only a week after it was introduced to the market, from P20 billion in February 14 to the current P40 billion. T h e s ho r t - t e r m T DF w a s a l s o oversubscribed with a bid coverage ratio of 1.0674 during the week. The volume of tenders stood at P53.37 billion, versus an offer of only P50 billion. A ll tenors attracted higher rates this week. In particular, the seven-day facility averaged 2.8164 percent this week, up from 2.7232 percent last week. The medium-term TDF of 14 days averaged 2.9798 percent, from the 2.8737 percent last week. The 28-day TDF averaged more than 3 percent at 3.0258 percent, from 2.965 percent last week. Bianca Cuaresma

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Editor: Efleda P. Campos • Thursday, February 22, 2018

Pamalakaya wants luxury resorts in Batangas probed for ‘violations’ By Jonathan L. Mayuga @jonlmayuga

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HE Pambansang Lakas ng Kilusang Mamamalakaya ng Pilipinas (Pamalakaya) said erring resort owners in Batangas should be investigated for various violations of environmental laws.

Like in Boracay, the group said the government should look into the environmental degradation caused by the unbridled development, including massive coastal-

land reclamation, to pave the way for the operation of beach resorts along coastal areas in the province. Pamalakaya said tourism is ad-

versely affecting the productivity of coastal communities, threatening the livelihood of thousands of fishing families and coastal settlers. The group cited the town of Nasugbu, where at least 300 hectares of coastal communities had been converted into a resort. The group claimed the beach resorts are affecting the livelihood of more than 1,000 people living in the area because their traditional fishing grounds have been declared off limits and marineprotected areas. “There are three marine-protected areas declared within the vicinity of these resorts where small fishermen are not allowed to conduct fishing activities,” said

Lino Baes, the spokesman of Pamalakaya in Batangas. He added private resort owners all over the country are violating various env ironmental laws, in the process depriving fishermen their right to fish even in their own traditional fishing grounds. Worse, he said, the unbridled development of private beach resorts destroys the marine ecosystem that leads to diminishing fish catch. Pamalakaya has been opposing the conversion of fishing waters into private use because it does not only result in the massive economic dislocation of fishermen, but also threatens to trigger disaster and cause irreversible

Region 10 leads in PRPD’s infra development

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OR T H E R N M i n d a n a o (Region 10) cornered the biggest infrastructuredevelopment investment totaling P1.78 billion under the Department of Agriculture’s Philippine Rural Development Project (DAPRDP) Mindanao cluster. The amount is 22 percent of the total Mindanao portfolio allotted for 34 projects of farm-tomarket roads (FMRs), bridges, potable water systems and postharvest facilities in the provinces of Bukidnon, Lanao del Norte, Misamis Oriental and Misamis Occidental. Region 11 comes second with P1.71 billion for 38 projects; followed by Region 13 for 24 projects worth P1.54 billion; Region 9 with P1.38 billion for 18 projects; Region 12 with P1.35 billion for 47 projects; and the Autonomous Region in Muslim Mindanao (ARMM) with P365.61 million for 13 projects. “This road will benefit farmers in transporting their products not only in our barangay, but other upland villages, as well,” Barangay Captain Marilyn Macabinlar of Panabol, Kinoguitan, Misamis Oriental said. The barangay has benefited from the concreting of 1.34-kilometer (km) PanabolBuko FMR amounting to P15.08 million. To date, the Mindanao cluster has a total portfolio of P8.14 billion for 174 infrastructure projects in various stages of implementation under the Intensified Building Up of Infrastructure and Logistics for Development

(I-BUILD) component. A total of 48 subprojects worth P1.3 billion has been completed. The remaining P5.39 billion was allocated for the 73 on-going subprojects and the P1.45 billion for 53 under procurement subprojects. Overall, there are 118 subprojects under the FMR category of

652.31 km worth P7.04 billion; seven FMRs with bridge with combined length of 43.65 km and 324.6 linear meter worth P710.77 million; two communal irrigation systems serving 150 km worth P36.68 million; 18 Level 2 portable water systems worth P99.71 million that will

benefit 4,408 households; and 29 postharvest facilities worth P250.73 million. I-BUILD component supports the development and linking of priority commodity value chains in project areas that will benefit producers, traders and rural population in general. Joy Montecalvo

CHEAP CAPS

Surplus baseball caps with various corporate tags are sold cheaply at a novelty store in Santiago City, Isabela. Affordability and durability make the head gears enticing to local buyers. LEONARDO PERANTE II

14th Mindanao International Studies Society Convention set in Davao City on February 22-25

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HE Ateneo International Studies Students Organization, the official academic club of International Studies majors of the Ateneo de Davao University, is hosting the 14th Mindanao International Studies Society Convention (Misscon). T he convention is schedu led from February 22 to 25 at the

Marco Polo Hotel in Davao City. T h i s M i nd a n ao -w ide a n nu a l convention aims to promote and strengthen International Studies as it brings together eight academic institutions offering the program. Through a series of plenary and parallel sessions that highlight local and international issues,

participative workshops, academic endeavors and other forms of fellowship, Misscon provides an avenue for International Studies students all over Mindanao to convene in the spirit of academic excellence and solidarity. This annual convention aims to encourage the participants to showcase their intellect, critical-thinking

skills and other talents. The theme of the event, “Rethinking Regions in International Relations: Mindanao,” aims to elevate Mindanao in the international scene by appreciating unity in diversity among its people, its rich and diverse economic, social, cultural and environmental resources.

ecological disruption to marine biodiversity. Baes said there are reports in the town of San Juan, Batangas, that private beach resorts have no proper waste-disposal facilities, causing pollution in the sea. The group called on the government to stop the operation of erring private beach resorts and hold the owners accountable for their environmental crimes. Pamalakaya said there are a total of 106 reclamation projects covering 41, 967.56 hectares of inland and marine waters throughout the archipelago. The group added these projects would “completely kill our marine resources and our fisherfolk.”

Malacañang sets consultations on Yolanda rehabilitation By Elmer V. Recuerdo Correspondent

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ACLOBAN CITY—The Office of the President will conduct a series of consultations to get the sentiments of Yolanda survivors and check the status of unfinished livelihood and housing projects in Yolandaaffected areas in Eastern Visayas (Region 8). Eight consultations in different areas have been scheduled in five provinces of Eastern Visayas to gather issues and concerns concerning the postYolanda rehabilitation projects the government is implementing, especially on housing and livelihood. In a meeting with the Eastern Visayas’s Regional Development Council, Presidential Adviser on Special Concerns Wendel Avisado said a budget had been set aside for the consultations that will be held in Tacloban, the towns of Guiuan and Balangiga in Eastern Samar, the towns of Carigara and Isabel in Leyte province, Silago in Southern Leyte and in Biliran’s capital of Naval. Avisado said President Duterte has ordered all government agencies to resolve problems raised by the people so they will know that the government has not neglected them. “The President wants to know the status of Yolanda rehabilitation projects,” he said. “We will go to every province. That is how serious the President is.” The dialogue consultations will be conducted between March 19 and April 19. At the end of the consultations, Avisado’s office will formulate a post-resettlement program for submission and approval of the President and the interagency task force. Director Kim de Leon of Office of the Presidential Assistant for Special Concerns said the consultations will also check if there are issues of “mismatch” in projects implemented.

Calabarzon LGUs form consortium on R&D By John Bello Correspondent

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UCENA CITY—To fast-track the government programs on science and technology to benefit the local communities, various government agencies in Calarbarzon (Cavite, Laguna, Batangas, Rizal and Quezon) region have linked arms to form a consortium for research and development. To this end, the provincial government of Quezon agreed to host a three-day event dubbed StaarrdecFiesta 2018 which highlights the province’s coconut and native pig industries. Staardec stands for Southern Tagalog Agriculture, Aquatic and Resources, Research, Development and Extension Consortium, while FiestA stands for Farms and Industry Encounters through the Science and Technology Agenda. Sen. Cynthia A. Villar, Quezon Gov. David Suarez, Party-list Rep. Anna Villaraza-Suarez of Alona, Southern Luzon State University President Dr. Milo Placino and Cavite State University President Dr. Hernando Robles, among others, graced the ceremonial cutting of ribbons for the opening on February 20. The event ends on February 22. On exhibit are the various commodities and products of Calabarzon. The event included various technology and investment forums, marketing, technology demonstration and poster-making and photo contests held at the Quezon Capitol Compound in this city. “This is not an ordinary fiesta of merry-making, but this event is an opportunity for us to invest in research and development to fast-track agricultural development to help our farming community,” said Villar, Senate Committee Chairman on Agriculture and Food, after she was introduced by Suarez, who expressed his gratitude for the presence and support of the lady senator on agricultural programs and development in Quezon. Villar said she is a firm believer in research and development in science and technology as a legislator. She added that technology and farm mechanization would lower the production cost of the country’s prime commodity, rice, from P12 to P6 a kilo. She told the participants and delegates from various sectors of the region that the chief rival of the Philippines in rice production is Vietnam, which produces rice at only P6 per kilo, with its labor cost at P1.20 compared to P12 in the Philippines with labor cost at P4.60 due to lack of farm mechanization. She felt sad that the farmers who feed the country cannot feed their own family as she said the average coconut farmer only has an income of P50 a day, as his coconut tree produces only 40 nuts a year, instead of trying to find ways to increase coconut production to 150 nuts to increase his income from P1,500 to P4,500 a month. “Let’s continue to find ways to support our agricultural development sector and let’s learn development models to apply to our lives and livelihoods,” Villar said.

Kalibo eyes regulating tattoo, body piercing for health safety

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ALIBO, Aklan—The Sangguniang Bayan of Kalibo is eyeing to regulate body piercing and body tattoo in both adults and minors. This will be enforced via a legislation currently being crafted. Body-piercing practices and tattoo are common in Boracay. It is currently trending in Kalibo.

Some of these practices are reportedly being done in households. Sources said high-school students in this town are having tattoo by group. Kalibo Councilor Cynthia de la Cruz, chairman on committee on health, said body piercing and tattoo for adults should be regulated by the Municipal Health Office.

“We agree tattoo is an art, a form of self-expression. However, there are health risks involved in both body piercing and tattoo. Among these is a huge possibility of getting infected with HIVAIDS,” de la Cruz said. Under the proposed legislation tattooing should be done in licensed parlor shops. It would also set preventive

guidelines for those who wish to avail themselves of such art in a safe manner. “Those who are operators of both body piercing and tattoo should undergo rigorous training from the Municipal Health Office. Tattoo is the procedure of putting ink into the cut skin by needle or machine. Possible effect includes allergy to dye, blood-born diseases like hepatitis,

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tetanus and AIDS if not done in a hygienic manner or equipment used are not well cleaned and sterilized,“ she added. The city council is expected to conduct a public hearing on this legislation. “We would listen to every one from resource persons to artists to consider their sentiments before coming up with a legislation,” de la Cruz said. Jun N. Aguirre

A10 Thursday, February 22, 2018 • Editor: Angel R. Calso

Opinion

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editorial

Bong Go vindicated

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he Senate investigation on the P18-billion Frigate Acquisition Project (FAP) of the Philippine Navy failed to establish the alleged questionable intervention of Special Assistant to the President Christopher Lawrence T. “Bong” Go. The probe showed that Go didn’t meddle with the warships deal and was merely a victim of irresponsible reporting and false presumptions. “I have been vindicated. The allegations have not been proven,” Go told reporters after the Senate hearing.

What’s surprising, however, was the unusually big number of Cabinet members that accompanied Go at the Senate probe—Presidential Spokesman Harry L. Roque Jr., Executive Secretary Salvador C. Medialdea, Cabinet Secretary Leoncio B. Evasco Jr., Labor Secretary Silvestre H. Bello III, Foreign Secretary Alan Peter S. Cayetano, Political Affairs Adviser Francis N. Tolentino, Budget Secretary Benjamin E. Diokno and Justice Secretary Vitaliano N. Aguirre II, to name some. The Presidential spokesman explained that the officials voluntarily went to the Senate hearing to show their solidarity and support to the President’s top aide. Go earlier denied he had anything to do with the selection process of the combat management system supplier for the Philippine Navy’s frigate program. He issued the statement following media reports that he allegedly favored Hanwha Thales of South Korea over Tacticos Thales of the Netherlands, which is allegedly the Philippine Navy’s preferred supplier. Explaining that this was a deal made by the previous administration, Go said he is not privy to the frigate transaction. Defense Secretary Delfin N. Lorenzana assured senators that the Navy’s FAP is aboveboard and will strictly conform to the country’s procurement laws. “The DND [Department of National Defense] is ensuring that the procurement process for the frigates are done and completed strictly in accordance with our laws, namely Republic Act 9184, or the Government Procurement Reform Act, and the Revised AFP Modernization Program,” he said. The Navy’s FAP is the biggest single procurement so far in the history of the Armed Forces of the Philippines. The defense chief said: “For the first time in our nation’s history, we have a chance to own a modern state-of-the-art military hardware, such as the two frigates, which we are acquiring for the Philippine Navy.” Lorenzana, however, lamented that there appears to be a concerted effort by some quarters to cast doubt on the acquisition project, the entire procurement system and the people behind it. Needless to say, the allegations thrown against the FAP is hurting not just the institution that is tasked to defend our country from internal and external threats but also the country’s seat of power. With the President’s top aide being dragged into the controversy, Duterte’s intolerance to any “whiff of corruption” is being challenged. Which is why the President said that he would fire Go if the media could prove that his special assistant had indeed intervened in the DND procurement. While the Senate probe failed to establish Go’s involvement in the Navy’s FAP, it unearthed some infirmities in the contract. For example, Sen. Joseph Victor G. Ejercito wondered why the DND allowed a foreign supplier to dictate what weapons system should be installed on the Navy frigates ordered by the Philippine government. He said: “I can’t take it that the Philippine Navy is the end user, but the shipbuilder, Hanjin Heavy Industries, has the option on what combat management system they will install. Why was this allowed in the contract?” Obviously, Go was not asked to answer the question, as the senators saw that he is not privy to the frigate transaction. Since 2005

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What happened to PHL medical tourism? John Mangun

OUTSIDE THE BOX

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n January 13, 2006, the headline read, “Philippines launches medical-tourism campaign”. The article quoted then as now, Health Secretary Francisco T. Duque III, saying: “Government agencies and private clinics and hospitals will strive to make the Philippines the new hub of wellness and medical care in Asia”. Global firm Allied Market Research says that the global medicaltourism market was valued at $61 billion in 2016. As of 2017 it is estimated that Tanzanian witch doctor Dr. Manyaunyau Tegeta, who gave up his jobs driving buses and fish gutting, has more medical tourism than the Philippines. Yes, Dr. Manyaunyau is real and can be reached on his cell phone at 0712-553169 or 0787-631291. All right, maybe that is an exaggeration, but the Philippines is not exactly on the top of the list for those seeking medical treatment outside of their home country. Even 40 years ago, Mexico was the

place to go for United States residents seeking five-star dental care and cosmetic surgery at ordinary US clinic prices. In 2016 over 11 million people left the United States for affordable health care. In terms of quality as a destination, the Philippines ranks No. 8 in the world. But the country does not hit even the top 10 in actual medical-tourism visitors. The Department of Tourism (DOT) has an estimate of approximately 80,000 to 250,000 patients annually. With data like that, it is not an estimate; it is a guess. I became interested in medical tourism through my personal dentist, Dr. Anselmo M. Tripon Jr. of

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Conclusion

National transformation

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HIS plan will use a more comprehensive systems approach to provide the proper integration of physical, economic, social, administrative and financial components. The unique advantage here is the orderly integration of various interdependence programs.

Projects covering infrastructure, agriculture, industry and the socialservices sectors will attain greater collective benefits as compared to a piecemeal project-by-project approach. Implicit also in these strategies are the inter-regional linkages and complementarities of economic and social activities in the regions. This includes social-development strategies to generate improvement in the quality of life of the Filipinos. The problem of expanding population should be dealt with, on the one hand by measures of control, and on the other, by expanding our capacities to provide for the population. As the labor force expands, we face the task of providing jobs to some 750,000 new workers every year, in addition to 8 million unemployment in 1987. This growth also requires the expansion of educational services to develop these additions to the labor forces into qualified manpower.

The other concomitant of an expanding population is a changing urban-rural profile. Inevitably, the urban population will grow to as much as 46 percent of the total population as against 35 percent at present. The implication is tremendous, in terms not only of the magnitude of food requirements but also in terms of the requisite amenities for a better quality of life, such as housing, health, education and other social services. Expectedly, these demands of a growing population will test our capabilities toward mobilizing our productive capacities and transforming our institutional systems. Within the next decade we must assume that the limits of agricultural land expansion will be reached, yet agricultural productivity must expand. We must prepare for technologyintensive agriculture while, at the same time, improving the efficiency of agricultural labor. Because agriculture will become less and less able to absorb an expanding

Bel-Air Dental Care in Makati. My long time good friend and neighbor, Jun, deserves a shameless plug for his business because he is the best dentist in the Philippines. Want to see a doctor in Malaysia? Easy. Just go to the Malaysian government medical-tourism web site at medicaltourism.com.my. You will find options such as “My Honeymoon Experience: Sea & Sun, Food & Culture Plus Health Screening.” There is also the “My Beautiful Smile Dental Package,” including sightseeing and shopping tours. You can book everything online. When you arrive, you will be welcomed and escorted to the exclusive health travelers airport lounge where visa and Customs clearance will be taken care of. Transportation is prearranged. Go to the Philippine DOT web site, and under “Health and Fitness” are web-site links to Belo Medical Group, Club One Health & Fitness Center and the Mandala Spa. The “Flight 168 Health Spa at the Air Force One KTV Club” was not included. Dr. Jun receives foreign clients every month through two private international medical-tourism web sites. This business is significant because it opens up a new market. For example, a retired man from the US

came to the Philippines to visit his old military buddies and had some dental work. His sister is coming next month, particularly to have extensive dental care. But the foreign business is not substantial. By now, Jun should have a separate clinic just for his foreign clients. My friend uses two international medical-tourism web sites to promote his clinic. But this is like going to a hamburger web site and picking from Jollibee, McDonald’s and Burger Machine and without any official government support. He asks only one thing from the Philippine government and the DOT a dedicated, comprehensive medical-tourism portal. This can easily be done with the cooperation and assistance of the Philippine medical community. The Malaysian government knows what the contribution to that economy is from medical tourism, and it is not a guess. In 2017 nearly 1 million medical tourists visited and spent $332 million. Apparently, there is no concept in Malaysia similar to ningas kugon.

labor force, industry and services must bear the brunt of generating more jobs. Accordingly, we assess and evolve an appropriate industrialization strategy that is labor-intensive, with some bias toward small- and medium-scale industries, and provision of appropriate incentives to effect regional dispersal of large-scale industrial development. The frontier of the sea remains relatively untapped, and promises to become the base for a continuing “blue revolution,” which was stated successfully during my administration. The challenge for us, then, is the development of our scientific and technological capabilities not only in terms of exploration and development but also in terms of conservation and renewal of our resources. The plan will try to evolve an appropriate institutional and administrative system that will effectively catalyze, energize, organize and execute—to attain the goal for national transformation. The ultimate goal of the plan for national transformation is to eliminate poverty, as we expect every Filipino to be beyond the threshold of concern for survival. The effort will then be for continuing improvement of the quality of life as provisions for social improvement and labor productivity accelerates. While development itself breeds problems of environmental degradation and ecological damage, there will be programs to improve the congeniality and habitability of human settlements. The Philippines, as it emerges as a modern agro-industrial state, will have attained relative peace and stability. We expect that our level of sophistication and developmental maturity by then will enable us to deal with the crisis or dislocations that development itself breeds, as new values and new

institutions become necessary. Self-reliance will have been attained as we exercise much more effectively a national economic self-determination cognizant of the cross-pressure from the evolving internationalism characterized by the viability of regional integration. Most of all, we will have highly qualified human resources in all levels, functions and tasks of our development that exists today. This plan for national transformation will set the stage for expanding our productive infrastructures; gains in agricultural-productivity efficiency, for a sustained implementation of a much more defined industrial energy, a highly qualified human and manpower resource and a stable, efficient institutional mechanism for development management—to achieve a level of income, employment and standard of living characteristic of an economy and society on an industrial takeoff. The plan for national transformation will also seek to harmonize development planning and bring into common direction the efforts of all agencies involved in development matters. This will reinforce individual activities at all levels of implementation. It will also seek to eliminate graft and corruption in the public service and fully develop the country’s moral, intellectual, physical and material resources. The full text of Trilogy, in the words of President Ferdinand E. Marcos himself bef ore he died in 1989, is in Chapter 17 of this writer’s new book, The Marcos Legacy, published this week for local and international distributions by Brown Madonna Press and Amazon, one of the world’s largest publishing houses.

Please e-mail questions and comments to mangun@gmail.com. Visit my web site at www. mangunonmarkets.com. Follow me on Twitter @mangunonmarkets.

To reach the writer, e-mail cecilio.arillo@ gmail.com.

Opinion

BusinessMirror

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Thursday, February 22, 2018 A11

PSE finally united in one Transfigured and deformed roof, but is it a marriage Msgr. Sabino A. Vengco Jr. made in heaven? Alálaong Bagá

Val A. Villanueva

Businesswise

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N February 19 stockbrokers from Ortigas and Ayala finally traded under one roof in its spanking new building at the Bonifacio Global City (BGC), the Philippine Stock Exchange Tower. In a phone interview, Philippine Stock Exchange (PSE) Chairman Jose T. Pardo told BusinessWise that, not only was the union historic, it signaled the ascension of the local bourse to world-class status. It was no longer an “all-boys club,” he said, an image the exchange had to grapple with for the longest time. A stringent vetting and security measures have been put in place to ferret out “misbehavior” among its members. Foremost among the changes the PSE has undertaken was the board-approved establishment of Capital Market Integrity Corp. (CMIC). A spin-off of the PSE’s market regulation division, CMIC was incorporated on May 26, 2010, and plunged into action on March 12, 2012. Pardo says that CMIC strengthens the confidence of the investing public in capital market institutions, “promoting a more active and vibrant market involvement.” He added that it also “acts as a sovereign audit, surveillance and compliance arm of the PSE.” The union of the two bourses was, indeed, sentimental and emotionally engaging, especially for me. I was in the middle of it all, first as an objective observer covering both exchanges for the Philippine Star as a business reporter, and then as active participant when I left the journalism profession to set up my own public-relations (PR) firm in the early-1990s. In 1986 just months after the Edsa 1 bloodless people power revolt, I was covering both exchanges, shuttling between Binondo and Makati. Covering both exchanges meant not only writing stories about the securities market. Bonding people involved in it comes with the territory: In Binondo, with Robert G. Coyiuto Jr., Den Somera and Joey Roxas of R. Coyiuto Securities searching for the best restaurants in the area after trading day, and in the Makati office of Papa Securities Inc., I drank King Cognac with the late Myron Papa (God bless his soul) from late afternoon to the wee hours of the morning. Back then, the union was farfetched, with both exchanges enjoying the space between them. But one lady, introduced to me by Myron in 1987, had this vision of a professionally run stock exchange. She was determined to break the exchange’s all-boys club image and erase the stigma that the stock market was nothing but a glamorized gambling den. Vivian Yuchengco Locsin of First Resources Inc. spoke with passion about her vision, and I could sense her sincerity and zeal to get things done: “You and your colleagues in the media have the power and the influence to fix what ails the securities industry,” she once told me. That first meeting with her began a friendship that has spanned three decades and is still going strong. Vivian and I may not see eye to eye on some issues, but our mutual respect for each other has never let our opposing views get in the way of our friendship. I have stood with her in many different corporate battles. We won most of them and, most important, we fought clean in all of them. Her commitment was matched by her innate grasp of where the market should go. The seed of the exchange’s union had not been planted yet, but she nevertheless saw that it would come sooner or later. That the stock market is now living in one roof, for me, should be a tribute to the people who shared the same vision as Vivian’s. Too bad they didn’t live long enough to see the fruition of their dreams: Myron Papa, George Uytioco, Gerry Urbina and Frankie Villaroman— all my mentors and dear friends. When I left journalism to set up my own PR firm, Danny Gozo of Ayala Corp.

in 1992 offered me an external communications consultancy job for Ayala Land Inc. (ALI). At that time, former President Fidel V. Ramos, realizing that two separate stock exchanges trading the same shares seemed odd, enforced a union between the Makati and Binondo bourses. It was the most contentious and emotionally charged issue that ever beset the local market. It also became a battle between two real-estate companies, ALI of the Ayala Group and Philippine Realty and Holdings Corp. of Gerardo Lanuza Jr. with both donating their respective buildings—Ayala in Makati against Tektite in Ortigas Center—to host the unified PSE. It didn’t help that then-Securities and Exchange Commission (SEC) Chairman Rosario Lopez had cast her lot with Lanuza’s Tektite Tower. I took my wife on a long and winding trip to see Lopez in her hometown in Tanza, Cavite, just to present to her ALI’s vision of a PSE center. It was followed by a dinner at the Nielsen Tower (now Blackbird at the Nielsen), which I, together with Lopez, Fernando Zobel de Ayala and former ALI President Francisco Licuanan III, attended. Lopez was adamant. We were flatly told to stop building our version of a PSE center. It was then that Frankie Villaroman and I devised a messaging plan, which centered on floorless trading. Both exchanges could hold separate buildings, but trade seamlessly through wireless technology. Frankie was not only a stockbroker, but an information-technology expert, as well. We spent nights crafting ways on how to put across the message that this could be done and was, in fact, a win-win solution to the gnawing unification problem. The messaging worked, although with understandable reservation from some brokers. In 1993 Tektite brokers started using the Stratus Trading System with a company called Equicom, while the Makati brokers employed the MakTrade trading system. The floorless trading was finally adopted, and both systems were connected on March 25, 1994, as a One Price-One Market exchange. Then on November 13, 1995, the execution of the Unified Trading System made way for the use of a single-order-book system on a MakTrade software, in which all the orders were posted and matched in one computer. But prior to the unification, an accident in November 1993 almost put a damper on the planned union. I got a call from Danny Gozo in the middle of the night, telling me that an unfortunate fate befell the construction of the PSE center. A portion of it had collapsed, and there were casualties. I immediately went to ground zero to meet with Don Jayme Zobel de Ayala who, with the help of the Makati police and the rescue team from the Makati Medical Center (MMC), personally attended to the victims. I was assigned at the MMC to facilitate the medical care for the victims, and was in constant close coordination with the late Bobby Chan, ALI’s government relations guy, through radio. Several construction workers died on that fateful night, and the tragedy was a PR nightmare that we had to handle with compassion and professionalism. Pardo was right when he said during his speech that the exchanges’ union under one roof at the PSE Tower in BGC took years to materialize. The union has overcome years of personal animosity, pride and family disputes. I’m proud and honored to have been in the thick of it all and hoping that finally, the marriage will work this time.

For comments and suggestions, e-mail me at mvala.v@gmail.com

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F Jesus’ stay in the desert for 40 days being tempted by Satan represents the relentless struggle between good and evil in the world, His mountain top transfiguration (Mark 9:2-10) stands for the glory that awaits one who remains faithful.

Transfigured and dazzling white Jesus was speaking to His disciples of His approaching suffering and death, but also of His resurrection after three days (8:31). To follow Him means taking up one’s cross and losing one’s life, but also that this is the way to save one’s soul, for which nothing is worth in exchange (8:34-37). To be untrue to Him in the world is to have no part with the Son of Man when He comes “in the glory of his Father” (8:38). It was to have a glimpse of this glory that Jesus took three of His disciples aside, to strengthen their faith and prepare them for the scandal of the cross. On the mount of the transfiguration, the divinity of Jesus was

allowed to shine through the veil of His humanity. His raiment became dazzling white, exceedingly white beyond duplication. Seen talking with Him were Moses and Elijah, two outstanding personalities in the history of the chosen people, parts of the larger picture that has now come to its fullness in Jesus Christ, who is the one to lead the people to their promised covenant with God. Jesus is the promised messiah whom all the precursors of the past spoke of and waited for.

My beloved Son

But heaven itself gave testimony to Jesus as from out of the cloud overshadowing all of them a voice

Polishing the TRAIN Atty. Irwin C. Nidea Jr.

Tax law for business

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verybody is excited to ride the Tax Reform for Acceleration and Inclusion (TRAIN). It arrived on time. But Congress watered down some of its original parts. I have no complaint since it is part of democracy. You cannot have it all. I am concerned, though, with some poorly crafted provisions of the law that are inconsistent with the true intentions of the government. Fortunately, TRAIN 1 is not the first and last ride. The succeeding TRAINs can still rectify questionable provisions. First, employees of regional headquarters, regional operating headquarters, offshore banking units and petroleum contractors that are enjoying the preferential tax rate under the previous Tax Code are now subject to the graduated income-tax rate based on a Bureau of Internal Revenue (BIR) advisory. Employees affected by this advisory have a legitimate argument that it is inconsistent with the law. According to them, the President did not veto the preferential tax rate of 15 percent. Unfortunately, the directive of the BIR is to implement the veto message of the President, which advocates equal taxation for all. Employers are now in a dilemma. Should they make a stand by not

following the directive of the BIR and risk going through the rigors of tax assessment or just follow the BIR’s advisory and let their employees carry the burden of additional tax, despite a legitimate argument against it? It is not too late for the government to correct this. If the intention is to apply the rates of withholding tax on compensation to everyone in the spirit of equal protection, then the law must be crafted clearly to reflect this. Second, among the real properties exempt from value-added tax (VAT) include the sale of real property that is not primarily held for sale to customers or held for lease in the ordinary course of trade or business, real properties utilized for low-cost and

announced: “This is my beloved Son. Hear Him.” At the river Jordan after the baptism of Jesus by John, heaven claimed Jesus and His identity was revealed to Him: “You are my beloved Son, in whom I am well pleased” (1:11). Now the same truth is revealed to His followers, and the revelation carries a responsibility with it. The Son is the Word and the icon of the heavenly Father. The Father is now represented to us by the Son, consequently everyone must listen to Him, for He is the truth, the way and the life. What He says about His death and resurrection is life to us. His words about imitating Him and taking up our crosses point the way to eternal life. What He teaches concerning the glory of the Father and the kingdom of God is life-giving truth to us. This is a replication of His call at the beginning of his public ministry: The reign of God is at hand, we must believe in Him and configure our lives with His. The disciples were sorely afraid; the experience of the divine is both terrifying and fascinating. But there is a particular temptation in reaction to the divine phenomenon voiced by Peter, “It is good for us to be here.” It is good to be up on some clean

mountain top away from the hurlyburly of the world, and to put off or be exempted from the Calvary of suffering and shame. It is good to be in ecstasy contemplating divine beauty. But the miraculous apparition was only for a while; suddenly they saw Jesus only and the heavenly cloud faded. And they came down from the mountain top. And they were told to tell no one about their experience till the resurrection of Jesus from the dead. Everything hinged on Jesus’ victory still to come.

socialized housing, as well as residential lot valued at P1.5 million and house and lot valued at P2.5 million. Revenue Regulation (RR) 16-2011 increased the VAT exempt threshold of residential lot valued at P1.5 million to P1,919,500. On the other hand, house and lot and other residential dwellings valued at P2.5 million was increased to P3.199 million. But with the advent of TRAIN, the VAT exempt threshold was brought back to P1.5 million for residential lot and P2.5 million for house and lot and other residential dwellings. In effect, residential lot that exceeds P1.5 million and house and lot that exceeds P2.5 million are now subject to VAT. It appears that this is an oversight on the part of Congress, since the real intention is to expand the coverage of VAT exemption for real properties for residential purposes. Can the BIR issue a similar revenue regulation as RR 16-2011 and unilaterally increase the amount covered by the VAT exemption? By doing so, is it tantamount to illegal legislation on the part of the executive? To avoid an unintentional hit on the marginalized sector, Congress must fix this in the succeeding TRAIN. Finally, taxpayers have no choice but to wait for a decision of the BIR in VAT refunds. Before the TRAIN, taxpayers have the following remedies: In case of (a) a full or partial denial by the BIR of the claim, or (b) the BIR’s failure to act on the claim

within 120 days, the taxpayer may file a judicial claim via an appeal with the Court of Tax Appeal (CTA) of the BIR decision or unacted claim within 30 days (a) from receipt of the decision; or (b) after the expiration of the 120-day period. The TRAIN deleted option (b) above. So, taxpayers now have to wait for a BIR decision before it can file an appeal with the CTA. Although the law provides for a criminal penalty if the BIR officer deliberately fails to act on a refund claim within 90 days, this remedy is very adversarial that businessmen want to avoid. Congress should not leave taxpayers at the mercy of the BIR. A remedy similar to option (b) must be made available in the succeeding TRAIN. We must always do it right the first time. This may not always be the case because we are just human. We can always correct a mistake and do it right the second time. Heads up! The second TRAIN is coming.

Alálaong bagá, it is our faith that Jesus is the definitive destiny of humankind. His way must be our way, His life ours. The certainty of the final glory strengthens us in our struggle for love, justice and truth, but we must not be seduced to remain remote and detached on some mountaintop. We have to go down on the plains of battle and live up to our faith. It is easy enough to be ecstatic over the transfigured Jesus on the heights, but we must also be with Him deformed on Calvary or in the slums of our society. Join me in meditating on the Word of God every Sunday, from 5 to 6 a.m. on DWIZ 882, or by audio streaming on www.dwiz882.com.

The author is a partner of Du-Baladad and Associates Law Offices (BDB Law), a member-firm of WTS Global. The article is for general information only and is not intended, nor should be construed as a substitute for tax, legal or financial advice on any specific matter. Applicability of this article to any actual or particular tax or legal issue should be supported therefore by a professional study or advice. If you have any comments or questions concerning the article, you may e-mail the author at irwin.nidea@ bdblaw.com.ph or call 403-2001 local 330.

The big Charter change debate: Con-ass vs Con-con Ariel Nepomuceno

DECISION TIME

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ithout any doubt, federalism has always been the consistent advocacy of President Duterte. Presumably, the core purpose is to decentralize power to the regions and provinces with the hope of ceasing its dependence on the national government. It is argued that popular sovereignty becomes real and visible in federalism. Self-rule is actualized with the regions being able to manage their own resources and finances and consequently take charge of their economic agenda.

whether the shift to federalism is an issue that needs an amendment or a revision of the Constitution, or as to whether it could be done via a constituent assembly or by a constitutional convention. Hence, Con-ass versus Con-con.

What approach to take

Legal grounds

However, how to make federalism happen is where the wider disagreement begins. The legislature is mandated by our constitution to pave the way for a federal form of government, subject to the approval of the people. This early, the debate centers around

TO be clear, Sections 1 and 2 of Article XVII of the 1987 Constitution provide that any amendment to, or revision of the Constitution may be proposed by (1) Congress, upon a vote of three fourths of all its members, or (2) a constitutional convention

and that Congress shall provide for the implementation of this right. Another issue is the fact that the Constitution is silent on whether the two chambers should vote jointly or separately during the process of changing the Constitution.

Different routes

The House of Representatives, led by its formidable leader, Speaker Pantaleon D. Alvarez strongly advocates for a Con-ass. And because there is nothing in the Constitution that mandates that the two chambers should vote jointly or separately on the matter of Charter change, he believes that there is no need to wait for the Senate to convene as a constitutent assembly. In fact, he said that the process has begun. On the other hand, the Senate, after listening to ex-Supreme Court justices and other legal luminaries, came up with a stand that since the change to a federal government is an extremely vital revision, there is still room for them to decide on whether a Con-con or a Con-ass will be the suitable process to make federalism a reality. While Justice Hilario Davide Jr. sees no need for Charter change, former Chief Jus-

tice Reynato Puno sees that it is high time to make the constitution more relevant and attuned to the radically changing times. However, both of them opined that a constitutional convention is the proper way of doing it because it removes the perception of partisan politics and selfinterest that are associated with a Conass. While arguably, a Con-con may be more expensive and would take more time, it was posited that the Constitution, being the basic law of the land, is worth the investment. Whatever and however these heated discussions take us, it is undeniable that the citizenry should be deeply involved in this matter. The Constitution is ours and whatever is stipulated therein affects the basic fabric of our daily lives. We must vigilantly watch how the process develop, how the arguments are framed, what provisions shall be changed, what changes should be introduced so we, as a people, would be able to chart our destiny, via a genuine democratic exercise.

For comments and suggestions, e-mail arielnepo.businessmirror@gmail.com.

2nd Front Page BusinessMirror

A12 Thursday, February 22, 2018

Tourism industry off to strong start this year as Jan arrivals rise 16% By Ma. Stella F. Arnaldo

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@akosistellaBM Special to the BusinessMirror

HE continued influx of South Koreans and another substantial increase in Chinese tourists powered the visitor arrivals in the Philippines to an all-time high of 732,506 in January 2018, up almost 16 percent from the figure in January 2017. Data released by the Department of Tourism (DOT) showed visitors from South Korea growing by 28.36 percent to 198,145 in January this year, while tourists from mainland China rose by some 30 percent to 111,344. In a news statement, DOT officials credited the increase in tourists to the “concerted efforts of

‘Team DOT,’ the stakeholder travel and tour operators, and the everhospitable Filipino community.” Tou r i sm Sec ret a r y Wa nd a Corazon T. Teo also said: “I am confident that with the combined efforts of the DOT and the stakeholders, we will achieve our 7.4-million international arrivals target for 2018.” Last year the

732,506 The number of tourists that visited the Philippines in January

Duterte administration slightly exceeded its 6.5-million foreign visitor-arrivals target. She also attributed the impressive visitor data for January 2018 to increased connectivity between the Philippines and its major tourism markets. “Last year’s momentum carried over this year with the improved air connectivity via increased flights between Philippine gateways and various airports in major visitor markets, including China, South Korea, the United States, Australia and Canada,” she noted. Teo cited Xiamen Airlines, which has mounted a three-times-a-week commercial direct-flight services between Fuzhou, China to Kalibo,

Aklan, and between Fuzhou and Puerto Princesa, Palawan using a 197-seat Airbus A321. “Another new route from China that our Route Development Team is working on is between Tiajin and Puerto Princesa,” the DOT chief said. “The development of new routes is in consonance with our National Tourism Development Plan’s strategy to upgrade air connectivity from major tourist source markets to the Philippines,” she stressed. A lso posting a double-digit growth from January 2017 is the United States, with visitor arrivals rising by some 15 percent to 109,154; followed by Japan with 57,038 arrivals (+7.8 percent); and Australia with 30,924 arrivals (+4.4 percent). “The higher visitor arrivals in January is a welcome news and bodes well for the tourism sector and the government’s efforts to boost the tourism industry,” the DOT secretary said. See “Tourism,” A2

‘PHL is now friendlier to businesses’

By Bernadette D. Nicolas

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@BNicolasBM

resident Duter te assured businessmen from India that they will now find it easier to do business in the Philippines as he is bent on cutting red tape and shielding them from corrupt officials. In a speech before the Federation of Indian Chambers of Commerce Philippines Inc. (FICCI) on Tuesday night, Duterte said he is committed to ensuring that businessmen will not have a hard time setting up shop in the country. “I want to tell you that as much as possible, we want you to be comfortable,” he said. “I am the President here and I am telling you that I would cut red tape.” Duterte said he is only giving his department secretaries one month and directors two weeks to process documents and will fire those who will not comply. He asked Indian businessmen not to entertain corrupt government officials. “Everybody will be protected and I will go after those persons in the government who are still into corruption.” The President also invited businessmen from India to consider investing in the telecommunications industry. “India is also interested to enter the Philippine telecom industry. And we are considering [the entry of Indian businessmen]. I invited them during my official visit to India.” The FICCI is one of the oldest Indian chambers outside of India and represents the major business interests of the Filipino-Indian business sector.

HEROIC ARRIVAL A total of 396 overseas Filipino workers (OFWs) from Kuwait arrived on Wednesday onboard Cebu Pacific Airbus A330. Cebu Air Inc. mounted a special charter flight to airlift the OFWs back to the Philippines in response to the call for assistance by the government to repatriate Filipino workers in Kuwait. Most of the OFWs don’t have a working permit in Kuwait, while some escaped maltreatment from their respective employers. OFWs are considered modern-day heroes for their contribution to the economy. NONIE REYES

Electricity bills. . . The rules also specified a particular methodology in computing the technical loss and nontechnical loss or pilferages. Distribution utilities’ (DUs) electricity usage will be treated as an operation and maintenance expense under the appropriate rate-setting methodology. A Performance Incentive Scheme was also devised to motivate the DUs to reduce the technical and nontechnical losses in their distribution systems. The ERC, pursuant to Section 43 (f) of the Electric Power Industry Reform Act (Epira), is mandated to establish and enforce a methodology for setting transmission and distribution wheeling rates and retail rates for the captive market of a distribution utility, taking into account all relevant considerations, including the efficiency and inefficiency of the regulated entities. To achieve the objective, the cap on the recoverable rate of system loss prescribed in Section 10 of Republic Act (RA) 7832, or the Anti-Pilferage of Electricity Act, is amended and will be replaced by caps to be determined by the ERC based on load density, sales mix, cost of service, delivery voltage and other technical considerations it may promulgate. “The ERC is mandated to study and update the distribution system-loss caps charged by

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the DUs to electricity consumers. The newly prescribed system-loss cap is a by-product of a well-thought study taking into account the relevant technical criteria and will promote the DUs’ efficient operation and service. The ERC will keep on looking for measures to bring down the electricity rates which are considered as among the highest in Asia,” Devanadera said. Meantime, the agency approved and issued certificates of compliance (COCs) and provisional authorities to operate (PAOs) to some generation companies (gencos). COCs were issued to the Circulating Fluidized Bed Coal-Fired Power Plant (Unit 3) of Panay Energy Development Corp., with 150-megawatts (MW) capacity in Barangay Ingore, La Paz, Iloilo City; and the Silay Power Plant of the Silay Solar Power, Inc., with 25-MW capacity in Barangay Rizal, Silay City, Negros Occidental. PAOs were issued to the following gencos: ■ Palm Concepcion Power Corp.’s Concepcion Coal-Fired Power Plant (Unit 1), with 135-MW capacity in Sitio Puntales, Barangay Nipa, Concepcion, Iloilo. ■ Nickel Asia Corp.’s Surigao Diesel Power Plant, with 10.944-MW capacity at Quezon, Surigao City. ■ EDC Siklab Power Corp.’s Gaisano Balasan Solar Rooftop Project, with 0.6144

MW at Balasan, Iloilo, and the Gaisano Oton Solar Rooftop Project with 0.6144 MW at Oton, Iloilo. ■ EDC Bago Power Corp.’s Bago Solar Rooftop Project, with 1.0304 MW at Gaisano Mall, Luna Street, Barangay Luna La Paz, Iloilo City. ■ SMC Consolidated Power Corp.’s Limay Power Plant (Unit 2), with 150-MW capacity in Barangay Lanao, Limay, Bataan. COCs are issued by the ERC in favor of a person or entity to operate a power plant or other facilities used in generation of electricity pursuant to Section 6 of RA 9136, or the Epira, and Section 4 of the implementing rules and regulations of the Epira. On the other hand, pending the issuance of the COC, the PAO may be issued by the ERC to enable a generation company to operate its generation facility. The PAO shall be issued in the form of a notification and shall be valid for a period of six months from issuance thereof. The six-month validity period shall be included in the five-year term of the COC that may be issued by the ERC. “It is imperative for a genco to secure a COC or a PAO from the ERC prior to its commercial operation. The ERC recognizes the need for the immediate issuance of the COCs and PAOs to gencos in order to ensure a reliable and sustainable power supply, especially that there is an upsurge in power demand during the summer months,” Devanadera said.

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Can Duterte reduce the nation’s dependence on migration? Continued from A1

countries have a deliberate program of seeking the best and the brightest from other countries to sustain their growth momentum. The exodus is a big drain on the talent and skills pool of the sending country. In our case, the POEA itself has actively been marketing Filipino would-be migrants across the whole skills spectrum for deployment in all corners of the world. The POEA even maintains a “hot list” of unfilled overseas jobs, which some narrow-minded officials claim is proof of the “mismatch” between Philippine education/ skills development and the jobs available in the world market. These officials forget that a nation’s educational and training system is programmed to meet the social, cultural and economic needs of the Philippines, not of other countries. If the Duterte administration is serious in reducing the nation’s dependence on migration, it should recalibrate and restrategize the country’s socioeconomic development program in order to make this happen. A historical review is in order. Birth of the “temporar y manpower export program.” In 1975 and 1976 then-Labor Secretary Blas Ople christened the policy of sending construction workers in the petrodollar-rich Gulf countries as a temporary manpower export program. At that time, martial law was in its third to fourth year and the labor-intensive export-oriented (LIEO) development framework formulated by then-National Economic and Development Authority (Neda) Director General Gerardo Sicat was in its infancy. The idea was to make the “manpower export” a “temporary” stop-gap employment policy, while the LIEO industrial policy had not yet taken off to usher in job-full industrial development for the country. But what happened? In the succeeding decades of the 1980s and 1990s, the temporary program rapidly expanded and the temporary manpower export program became “permanently temporary.” Along the way, the Filipino “overseas contract worker” was renamed “overseas Filipino worker” (OFW). At the turn of the millennium, the term “temporary” was quietly shelved and the program of sending out OFWs was simply placed under a policy dubbed by then-Labor Secretary Pat Sto. Tomas as “managing migration.” Under managing migration, the role of the government was reduced to two major tasks. The first was to extend protection to OFWs, from the campaign against illegal recruitment at home to the placement of welfare officers in migrant destination countries and to the negotiation of bilateral agreements with labor-receiving countries. The other task is the all-out marketing for the services of OFWs in all categories of work under all rungs of the skills ladder for all corners of the globe. What is bizarre is to see how the various Medium-Term Philippine Development Plans (MTPDPs) of the Neda have treated migration as secondary to the “competitiveness” programs it had drawn for industry and agriculture. Migration, which has become the nation’s lifesaver, merited only a few paragraphs and pages in the voluminous MTPDPs.

As to the LIEO program, this was renamed in the 1980s as the “export-oriented industrial” (EOI) policy under the World Bank-supported “structural adjustment program” (SAP). Like the LIEO of the 1970s, the EOI-SAP program of the 1980s to 2000s failed to usher in the promised “NIC-hood” for the nation. Instead, both the industrial and agricultural sectors stagnated in these SAP-EOI decades. It was the services sector that zoomed up, boosted primarily by the consumer spending of the OFWs, whose number has grown from around 50,000 in 1975 to over 10 million by 2015 and whose remittances have enabled the economy to grow year by year. Economists keep calling Philippine growth pattern as “consumption-led.” But who is doing the consumption and who are profiting from such consumption (think of the Sys, Gokongweis, recruiters, bankers, realtors, etc.)? In the meantime, tales of migrant abuses and migrant family breakups continue to pile up, documented by a growing number of journals, books and doctoral dissertations dealing with the “OFW phenomenon.” The most vulnerable migrants happen to be those with the least skills who are given the “3D jobs” (dirty-dangerous-difficult jobs) or the “Salef jobs” (shunned by all except by a very few of the nationals of the labor-receiving countries). Susan Ople, daughter of Ka Blas Ople, has dedicated her life fighting the abuses and humanrights violations committed against these vulnerable OFWs in various climes. Many are victims of illegal recruitment, human trafficking, maltreatment by cruel employers, duplicity of local and foreign “labor brokers” and corrupt practices by errant labor and foreign affairs officials. Toots Ople asked: Why can we not adopt a similar Indonesian policy in relation to Filipina maids sent to the Middle East? In 2015 Indonesia declared that it has a “road map” to stop the deployment of Indonesian maids in the Middle East and other countries if there is no concrete assurance of protection to these maids such as giving them separate housing facility (or dormitory) and respecting their basic human and labor rights, e.g., regular working hours and weekly rest days. In Kuwait and other Middle East countries Filipina maids have become virtual house prisoners because their passports and identification cards are kept by their employers, they are forced to work and live 24/7 with families with a different culture and language and their mobility and communication rights are strictly limited. In this context, a deployment ban in countries like Kuwait seems to be a bit late. But yes, it is still a correct move and should apply to other Kuwait-like destination countries. But how then should the Duterte administration spearhead a program to liberate the nation from its dependence on migration? Can the Philippines duplicate the experience of South Korea, which succeeded in transforming itself into a labor-receiving country beginning in the 1990s after decades of being a labor-sending country (1970s-1980s)? More on this in the next article.