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Thursday, January 4, 2018 Vol. 13 No. 85

Govt warns firms against taking advantage of TRAIN

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By Catherine N. Pillas @c_pillas29 & Lenie Lectura @llectura

he government vowed to intensify its marketmonitoring activities to prevent unscrupulous manufacturers and retailers from unduly jacking up prices due to the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law.

Achieving SDG targets in wicked times

LOPEZ: “Manufacturers and retailers should not increase prices. We will be on the lookout for hoarders and profiteers.”

Rene E. Ofreneo

laborem exercens

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The Department of Trade and Industry (DTI) on Wednesday also called on retailers and manufacturers to absorb the “minimal” impact of TR AIN on most products. “Manufacturers and retailers should not increase prices. We will be on the lookout for hoarders and profiteers,” Trade Secretary Ramon M. Lopez told

n his New Year message, United Nations Secretary-General Antonio Guterres issued a “red alert” instead of a traditional appeal for peace and harmony among UN member-states. His worry: The world is getting more and more divided given the growing threat of a nuclear war (think of North Korea), lack of global consensus on how to tame global warming, deepening inequality everywhere and rising xenophobia. His brief message ended with a call for global unity to address the foregoing.

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a bor group A ssociated Labor Unions-Trade Union Congress of the Philip pines (ALU-TUCP) will demand an across-the-board wage increase nationwide if prices of basic commodities and services skyrocket due to the implementation of the new tax law. In a statement on Wednesday, the ALU-TUCP announced it would file a petition for a substantial increase in the minimum wage nationwide to allow workers to cope with the price hikes triggered by the Tax Reform for Acceleration and Inclusion (TRAIN). The TRAIN is the first package of the Duterte administration’s comprehensive tax-reform program (CTRP) that took effect on January 1. “We will indeed file a petition for wage increase if there are extraordinary increases in prices of basic commodities, such as rice, fish and vegetables, and if there is excessive surge in cost of services, such as transport fare, tuition fees, electricity and water rates,” ALU-TUCP Spokesman Alan A. Tanjusay said. “If the situation warrants, we will file the petition for workers to cope with rising cost of living, even if the one year prescribed for no-wage-increase period set by the wage board is still in effect.” Under Section 3, Rule 4 of the National Wages and Productivity Commission Revised Rules

2017 holiday season saw marked rise in e-buying

Tanjusay: “If the situation warrants, we will file the petition for workers to cope with rising cost of living, even if the one year prescribed for no-wage-increase period set by the wage board is still in effect.”

@alyasjah

of Procedure on Minimum Wage Fixing, a wage order may not be disturbed within 12 months from effectivity. On top of this, the wage board is not allowed to entertain petitions for wage increase within the same period. The last time the wage board approved a wage increase was last September, when Metro Manila workers were granted additional P21 that elevated minimum wage in the Philippine capital to P512 for nonagricultural workers and P475 for agricultural workers. However, the rule may be sidelined should there be a supervening condition—particularly an increase in prices of petroleum products and basic goods and services—that warrants the review of minimum-wage rates. Under the TRAIN, workers with a gross annual income of P250,000 and below are relieved from paying personal-income tax (PIT). Minimum-wage earners, on the other hand, will continue to enjoy exemption from paying PIT. In exchange, the government will slap excise tax on oil of up to P6 over the next three years: P1 See “Labor sector,” A2

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Labor sector monitoring TRAIN’s impact on prices to see need for wage hike By Elijah Felice E. Rosales

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By Lorenz S. Marasigan @lorenzmarasigan

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which are still owned by the original residents, while others have been repurposed as restaurants or other commercial establishments. The charm of Camiguin lies in the serenity of the surroundings —only intermittently interrupted by the “broot-broot” of passing tricycles—and the friendliness of its people. The island is famous for its Lanzones Festival held ever y third week of October, as well as the Panaad Festival every Holy Week, but there will be less tourists around these festivals. There are a

ORE and more young Filipinos are embracing the digital age, according to latest data from tech company Voyager Innovations Inc., which recorded an almost threefold increase in unique online and cashless transactions during the last two months of 2017. While he did not disclose absolute figures, PayMaya Philippines Inc. COO Paolo Azzola said such an increase resulted from several sale events and promotional offers from digital-market places, such as Lazada, Zalora and Tackatack. “While mall shopping is still the norm for most Filipinos, we saw a marked increase in online shopping among our mostly millennial user base during the 2017 holiday season,” he noted. Azzola added that this observation “points to the growing number of Filipinos who are getting comfortable in digital commerce” as a viable option for holiday shopping. “On top of the online promo offerings, convenience and the worsening traffic in major cities are probably compelling more individuals to do their shopping online,” Azzola explained. Digital marketplaces launched online promos during the last two months of 2017, with PayMaya giving its account holders exclusive discounts on different platforms. Lazada topped the list for the most

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See “E-buying,” A2

Kalanggaman Island in Palompon, Leyte, with its azure waters teeming with a diverse array of marine life. Image courtesy of D.O.T.

Travel ‘bucket list’ for 2018 By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

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Conclusion

HIS year’s holidays have already been announced, so it’s time to start planning for your vacations. We spoke to travel experts (and gave our own inputs, as well) on local destinations we simply must visit this year. 5. Camiguin in Northern Mindanao—Just under 30,000 hectares, the pear-shaped island province has seven volcanoes dominated by the still-active Mount

Hibok-Hibok; no wonder it’s been called the “Island Born of Fire.” Other popular attractions include White Island, actually a sandbar that disappears during high tide; the breathtaking Katibawasan Falls, which drops from a height of some 80 meters into an icy-cold pool below; the Catarman Church Ruins consisting of adobe walls and the belfry of the old Guiob Church wiped out by a massive volcanic eruption in 1871; as well as the Sunken Cemetery, marked by a huge white cross. Spanish ancestral homes dot the capital of Mambajao, some of

n japan 0.4450 n UK 67.9329 n HK 6.3930 n CHINA 7.6919 n singapore 37.5991 n australia 39.1271 n EU 60.2593 n SAUDI arabia 13.3221

Source: BSP (3 January 2018 )

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A2 Thursday, January 4, 2018

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Govt warns firms against taking advantage of TRAIN Continued from A1

reporters in a text message. Lopez downplayed the impact of the TRAIN law on commodities and services. He noted that, based on previous reviews, the impact of the tax-reform package on inflation is at 0.7 percent and the overall impact on prices is at 7 percent to 8 percent. “For most products, TRAIN has a minimal impact in inflation. The increase brought about by the excise tax is 7 [percent] to 8 percent, and the fuel and transport cost as percentage of production cost is less than 5 percent,” he said. “This minimal impact should not alter SRPs and absorbed by companies. Companies also do not tend to individually increase price for fear of losing market share,” Lopez added. However, for specific goods identified in the TRAIN law, the DTI noted that the current inventory would be enough for traders to hold off any price increases until mid-January. For example, the excise tax on refined and manufactured mineral oils and motor fuels will increase, while sugar-sweetened

Labor sector. . . Continued from A1

this year, P2 next year and P3 in 2020. The TRAIN will also impose a P6 per liter tax on drinks containing caloric and noncaloric sweetener and a P12 per liter tax on beverages with high-fructose corn syrup, though essential sugar-sweetened beverges, such as 3-in-1 coffee and milk, are exempt from these taxes. The new tax law also increased excise tax on coal from P10 per metric ton to P50 per MT this year, P100 per MT next year and P150 per MT in 2020. This will lead to

beverages will be slapped a tax of P6 or P12 per liter, depending on the sweetener used. “TRAIN will have no impact yet on gas stations as they carry inventory sans the higher excise tax and [the price] will stay for two to three weeks.For the sugar-sweetened beverages, we’re getting confirmation from soft drink companies regarding their current inventory, but they usually have two weeks’ worth of supply,” Lopez said. In a statement, advocacy group Laban Konsy umer Inc. called on the government to appoint a “price czar.” “We appeal to the President and his economic team that a price czar be appointed to perform specific work and mandate and lay the basis and foundation of an organized and reasonable implementation of the TRAIN Act,” said Laban Konsyumer President Victoria Mario Dimagiba, who is a former trade undersecretary for consumer protection. The Department of Energy (DOE) expects oil firms’ current inventory levels to last for 15 days, which means local pump prices are not

expected to increase anytime soon, amid the implementation of the new excise tax and value-added tax (VAT). “We are expecting fuel prices not to increase in the next 15 days based on the 15-day minimum inventory requirement of oil companies, agency records and projections,” Energy Assistant Secretary Leonido Pulido III said in a news briefing on Wednesday. Sought for comment, Phoenix Petroleum Vice President for External Affairs Raymond Zorrilla said “we maintain at least 15 days.” PTT Philippines General Manager Danilo Alabado said, “We are still in the process of accounting our old inventory and projection to determine until when our old stocks will last.” Pilipinas Shell said it has yet to receive advice from retailers regarding current inventory levels. “If you are asking about the stocks in the retail stations, we are still checking it from our retail group,” company spokesman Cesar Abaricia said. Based on DOE figures, Energy Undersecretary Felix William B. Fuentebella said the price of gaso-

line, which is currently pegged at about P47.15 per liter, will increase by P2.97 to P50.12 per liter; diesel will go up by P2.80 per liter, from P36.50 per liter to P39.30 per liter; and kerosene prices will rise by P3.30 per liter, from P42.50 to P45.80 per liter once the old stocks of oil firms are depleted. Liquefied petroleum gas (LPG) prices are expected to go up by P12 from the current P550 per 11-kilogram cylinder. Pulido said LPG prices are expected to remain at current levels “since they have an inventory of seven days.” The DOE clarified that the implementation of excise ta x and VAT for petroleum products under the TR AIN does not apply to the old stocks of petroleum products, including their stocks u nder t he 15 - d ay m i n i mu m inventory requirement. 
 Consequently, retailers should not charge the new excise tax to the consumers. “ The Oil Industry Management Bureau has issued an advisory to petroleum products stakeholders not to levy new excise-tax rates on old stocks, considering that excise taxes are levied upon

importation and not at the point of sale to the consumers,” Pulido said. While the DOE said it stringently monitors oil trading in the international market and analyzes its effects on the domestic prices of petroleum products as mandated by the oil deregulation Law of 1998, it wants oil firms to submit their inventories to determine the supply that will be sold with and without higher excise taxes. “The DOE must know the inventory of the oil firms and we will trace every retail station how much is the impact of the excise tax and when it will take effect on their respective stations,” Fuentebella said. The energy department has also invited the oil companies to a meeting to clarify the mechanisms in the implementation of the new tax law.
The agency said the oil companies concurred to share their data regarding their sales to the dealers/retailers to determine which stocks will be applied with the excise tax.
 According to the DOE, oil firms agreed to submit their stock inven-

an increase in prices of electricity, though Malacañang claimed it would be a manageable hike. “All we can do for now is put our ears close to the ground and monitor the impact of the TRAIN Act to the inflation,” Tanjusay said. If proven hurtful to the poor, he said their group could all at once file the wage-increase petitions through the 17 regional wage boards, or through an emergency legislation through the House of Representatives. Tanjusay vowed that the ALUTUCP will study the actual impact of the TRAIN to the poor and will submit a recommendation to Malacañang, whether to improve

or modify the law, postpone it or nullify it altogether. The last across-the-board wage increase nationwide was in 1989. The labor leader also took a swipe at the P200 monthly cash transfer distributed to the poorest 10 million households intended to offset the impact of the new tax law. “Where is the money sourced from, what government agency is in charge of doling out? Where are the doleout implementing rules and regulation? Where are the terms of reference? Who are the qualified beneficiaries? And when, if ever there is, the dole out would be disbursed?” he said. “If not addressed, the brewing

social storm would create bigger and wider poverty among our people. Workers are already burdened with preexisting bad conditions and encumbered with traffic congestion and high cost of living. The unclear, if not inadequate social safety net, will offer no hope for workers in coping with rising inflation,” Tanjusay added. In a news briefing, Presidential Spokesman Harry L. Roque Jr. said the government is still in the process of creating a technical working group tasked to distribute the P200 monthly cash transfer. “Now the cash grant will be distributed between January to July and a technical working group is now

being held in preparation for the timely release of this cash transfer,” he said. He also reminded oil companies to not impose the additional excise tax on old inventories of fuel products. “They are to be imposed on new deliveries still to be made; meaning that inventories that already exist should not be subjected to the additional excise tax.” Duterte last December signed into law the first package of his administration’s CTRP. A hefty chunk of the TR AIN’s revenue will be allocated to the government’s infrastructure program, while a portion of it is to be spent on social services.

Pump prices

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tories as of the December 31, 2017, cutoff date under a notarized document to be submitted to the agency. For transparency, oil companies will also require their retailers to post the new rates and when these will be effective. At the same time, the agency called on the public to report unscrupulous retailers. The DOE and other relevant government agencies would also conduct random audit and monitoring activities, both in the depot/refinery and the retail level or gasoline stations. “Aside from honesty system and cooperation that we are asking from oil-industry participants, we are conducting random tests together with other relevant government agencies, such as the Bureau of Internal Revenue and local government units,” Fuentebella said. “If we need to monitor every single retailer, we will do so just to protect the consumers. The oil firms must show us their authenticated and notarized documents that will be submitted to the DOE to maintain transparency and honesty for the consumers’ sake,” he added.

E-buying. . . Continued from A1

transactions through the PayMaya platform. In terms of the kinds of items ordered online, power banks, external hard drives, bluetooth speakers and smart watches dominated the shopping list of consumers. This, he said, shows that Filipinos— especially millennials—are embracing the digital lifestyle. “Consumers are also given flexibility by online merchants in terms of payment options, making online shopping a more attractive option,” he added. Adoption of digital payments and commerce has grown faster over the past two years, as prepaid e-wallets regulated by the Bangko Sentral ng Pilipinas, such as PayMaya, have been introduced. These digital wallets foster financial inclusion, as any mobile-phone user in the Philippines can create an account and use it for online transactions up to a certain amount limit. Latest available data from Better than Cash Alliance as of 2013 show that around 99 percent of all payment transactions in the country are still done via cash. Electronic payments by businesses and individuals account for 1 percent and 0.3 percent, respectively. PayMaya aims to increase cashless transactions to 20 percent of the total volume of payment transactions by 2020.

Referendum. . . Continued from A12

Oriental is handling the provisions on the Executive-Legislative (Articles 6 and VII); New article on Federal and Regional Powers, Numbers of States; and Local Government and Taxation/Allocation of Resources (Article X). TWG 2 chaired by Deputy Speaker Fredenil H. Castro of the Second District of Capiz is drafting the provisions on the Judiciary (Article VIII); Amendments or Revisions (Article XVII); Suffrage (Article V), Citizenship (Article IV); and Bill of Rights (Article III). TWG 3 chaired by Rep. Alfredo B. Benitez of the Third District of Negros Occidental is preparing the Preamble; National Territory (Article I); Declaration of Principles and State Policies (Article II); General Provisions (Article XVI); and Transitory Provisions (Article XVIII). Last, TWG 4 chaired by Rep. Vicente S. tVeloso of the Third District of Leyte is handling Social Justice, Labor and Others (Article XIII); Education, Science and Others (Article XIV); National Economy and Patrimony (Article XII); New article on the Bill of Duties; Accountability of Public Officials (Article XI); and Family (Article XV).

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All-out offensive against Reds with end of holiday cease-fire

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ith the conclusion of the Yuletide truce on Tuesday, military units can now pursue New People’s Army (NPA) rebels who blatantly violated their own cease-fire declaration by attacking government troops and civilian communities. “The AFP [Armed Forces of the Philippines] will resume focused military operations after the Somo [suspension of military operations] has lapsed. All ground units will pursue NPA members who violated their own cease-fire declaration by attacking government troops and harassed civilian communities,” AFP Spokesman Col. Edgard A. Arevalo said in a message issued on Tuesday.

The AFP implemented a unilateral cease-fire during the Yuletide season, which started 6 p.m. of December 23 to 6 p.m. of December 26 and 6 p.m. of December 30 until 11:59 p.m. on January 2. This cease-fire was mirrored by the NPA, but some of its units opted to attack military units in Davao Oriental and Compostela Valley. He added that military units will resume proactive combat measures nationwide to protect vulnerable communities from armed threats and deceptions of the NPA. “Our noncombat efforts on assisting other line government agencies on infrastructure development and community health engagements will continue,” Arevalo said. PNA

‘Oppose compromise pact with Marcoses’ By Joel R. San Juan @jrsanjuan1573

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ORMER Solicitor General Florin T. Hilbay has called on Filipinos to oppose any bid of the family of former strongman Ferdinand E. Marcos Sr. to enter into a compromise agreement with the Duterte administration involving their alleged ill-gotten wealth. Hilbay noted that the offer for a compromise agreement had been floated during the past administrations, but were all met with public resistance. “All non-Aquino presidents— Ramos, Estrada, GMA [Fidel V. Ramos, Joseph E. Estrada, Gloria Macapagal-Arroyo] - tried to enter into a compromise agreement with the Marcoses and their billions,” Hilbay alleged. “All failed because Filipinos loudly resisted,” he added. “We shouldn’t make Duterte an exception,” he said. Hilbay issued the statement after Presidential Spokesman Harry L. Roque Jr. confirmed

All failed because Filipinos loudly resisted.”—Hilbay

a copy of the draft agreement was submitted to Marcos lawyer Oliver Lozano. On the other hand, Roque assured no deal has been made yet with the Marcos family to facilitate the return of their illgotten wealth to the government. “There is no truth to the allegation that the government has reached a compromise agreement with the family of the late President Ferdinand Marcos,” Roque said. “Atty. Oliver Lozano may have written to Malacañang proposing the creation of a legal team that would study a compromise agreement with the Marcos family. The proposal, however, has not been acted and agreed upon by the Palace,” he added.

Editor: Vittorio V. Vitug • Thursday, January 4, 2018 A3

Federalism and Con-ass top 2018 House legislative agenda–Alvarez

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op billing the legislative agenda of the House of Representatives for this year are changing the three-decade-old Constitution by convening Congress into a Constituent Assembly (Con-ass) and shifting to a federal form of government.

“No. 1 is the convening of Congress into a Constituent Assembly and in revising the Constitution, a shift from a unitary to a federal form of government,” Speaker Pantaleon D. Alvarez said in a television interview on Wednesday. Alvarez earlier said both houses of Congress would convene into a Con-ass in January to propose amendments to the 1987 Consti-

tution for a federal government. He said if the Con-ass pushes through, the proposed federal charter could be submitted for referendum simultaneously with the barangay elections in May this year. The Speaker said he is confident that the House supermajority would give its backing for the Constituent Assembly. He, however, expressed doubt

if the Senate has enough numbers in support of the proposal as he appealed to the sense of patriotism of senators. He said the senators are concerned over the political implications of the possible dissolution of the Senate in a federal setup, noting that this should not be a cause for concern since they could still be eligible to run for election to the new legislature. “This is a question of patriotism, kung ano ’yung tama at kung ano ’yung kailangan sa bayan [what is right and what the nation needs],” Alvarez said. Alvarez noted that the two chambers could have some disagreements over the issue of either voting jointly or separately in a Con-ass. He said he prefers that the assembly vote jointly. Alvarez also said the timetable of the forthcoming 2019 midterm

Palace defers naming of govt exec to be axed

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Puppy love

A woman arranges assorted dog figurines being sold at a lucky-charm store in Binondo, Manila. According to the Chinese Zodiac, 2018 is the Year of the Dog. ROY DOMINGO

Federalism shift opens door for Duterte term extension Peza eyes ‘reverse trade’ tack to reduce imports By Butch Fernandez

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@butchfBM

enate President Aquilino L. Pimentel III on Wednesday left the door open for a possible extension of President Duterte’s sixyear term when the Constitution is amended to shift to a federal form of government. Under t he 1987 Const it ut ion, President Duterte was elected by direct vote to serve a six-year term without reelection, formally assuming the presidency when ex-President Benigno S. Aquino III stepped down on June 30, 2016. Reacting to a “no [2022 presidential] election scenario” floated by House Speaker Pantaleon D. Alvarez as a consequence of the Duterte-backed shift to a federal system, Pimentel sought to assure the proposed transition to federalism does not bar holding presidential elections. “That is not an ‘either/or’ situation. We can shift to federalism and allow all scheduled elections under the existing Constitution to go on and be held,” Pimentel said. “What is important are the transitory provisions, which will govern the terms and duties of those elected in the last election under the 1987 Constitution.” Pimentel said that “ before we can operate under a new Constitution, the provisions, of the existing Constitution must be followed. Hence, if there are scheduled elections under the existing Constitution then this must be followed.” But when asked if the shift to another form of government will enable Duterte to extend his term as transition president, Pimentel replied: “[It]

depends on the transitory provisions.” He added that such a scenario will also depend “on when we approve the new Constitution.” If the Charter changes are done in 2019 “then the next three years will be the transitory period,” Pimentel said, adding “we can extend the President’s term, one, If really necessary; two, if he [Duterte] is amenable to it; and three, since that extension will be part of the new Constitution, the new Constitution is approved by the people themselves.” Asked to confirm if the objective of reviving Charter Change initiative under the Duterte administration includes extension of the President’s term, Pimentel insisted that “the objective is fedralism. That’s all.” Pimentel, however, sidestepped queries on whether the term-extension plan was discussed with and whether Duterte was amenable, saying, “Please refer the question to the President. Only he can answer that.” For his part, Senate Minority Leader Franklin M. Drilon, in a viber message to Senate reporters, said this development unveiled the real agenda of Duterte administration and its allies in Congress. “The cat is out of the bag!” Drilon said. “At least, the real purpose of federalism is out-term extension. We will oppose such proposition,” he added.

No no-el campaign

elections may be affected if the Filipino people accept the federal form of government. “May transitory provision. Nakalagay doon na ’yung mga elected officials na mag-e-expire ’yung term, hindi ba, kung kailan sila due for elections, iba-iba [There is a transitory provision. It states the expiration of the terms of the elected officials. It says when they can run for another election. It varies],” Alvarez said. “So depende talaga iyan kung ano ’yung mapagkakasunduan doon sa Constituent Assembly, [It depends on what will be agreed upon at the Constitutent Assembly]”, Alvarez added. Alvarez said the federal setup proposed by the PDP-Laban retains the position of the President, who would act as head of state, and introduces the position of a Prime Minister, who would be the head of the government. PNA

Contr ary to Alvarez’s opinion of no-elections in 2019, Malacañang said the upcoming midterm elections will push through no matter what in compliance with the highest law of the land.

In a news briefing on Wednesday, Roque said President Duterte will not campaign for no-elections in 2019. This, unless Congress will be able to craft a new Constitution along with the passage of the country’s transfer to a federal type of government. “Again, the President always looks to t he Constitution as his g uidi ng doc u ment. T he Const it ut ion sets the date for the next elections in 2019. So, unless the Constitution is amended ahead of the 2019 elections, it wou ld have to push through,” Roque said. Alvarez in a television interview said there might be a need to form a transitory government in case the shift to federalism is approved before May next year. “Let’s be practical. [When] nag-shift ka into a different form of government—unitary to a federal—you need a transition government,” he added, noting time must be allotted for the government to apply the changes provided by federalism. This, however, does not bother the President nor Malacañang. To them, it is important to adhere to what the Constitution states. “Well, the Chief Executive, the role of the President is to implement the Constitution and the law. As I said, it is the Constitution that sets when the next election is. The law required of Congress for election purposes will only enable the spending of public funds in that regard. So, unless the Constitution is amended, which includes being ratified by the people prior to the date set in the Constitution, elections will have to push through,” Roque said. With Elijah Felice E. Rosales

By Catherine N. Pillas

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@c_pillas29

he Philippine Economic Zone Authority (Peza) is eyeing to embark on a so-called reverse-trade fair this year in a bid to lessen the country’s dependence on imports. Peza Director General Charito B. Plaza said this reverse-trade fair approach is aligned with the agency’s effort to minimize import dependence of local manufacturers. “We will display the importations of our industries to let local suppliers know that these are being imported and there could be a chance that they can supply these to the industries instead. This will enhance the business capability of local suppliers,” Plaza told reporters in a recent interview. This strategy of import substitution, however, may hit a snag as this is currently a point of contention in the recently passed tax-reform law. To recall, the President Duterte vetoed at the last minute the zero-rating on goods and services sold to goods and services to separate customs territory and tourism enterprise zones. Peza earlier lobbied to maintain the zero-rating tax treatment earlier in the year during the bill’s deliberation in Congress to keep the cost of input materials to keep ecozone exporters competitive. Annual local purchases of inputs by Peza-registered locators are estimated to amount to at least P24 billion, an amount that will be lost to importations if the value-added tax (VAT) exemption is removed, Plaza said She earlier warned this move will kill local suppliers and small and medium enterprises in the value chain of exporting industries. Peza Deputy Director General Harriet Abordo, said, however, they will stand by a Supreme Court (SC) ruling which countered this veto provision and upheld the zero-rating of sales of goods and services to Peza. Albeit Abordo did not specify a case, a 2010 SC decision on a case on a VAT refund of the Bureau of Internal Revenue to Toshiba Information Equipment (Phils) upheld the latter’s right to credit/refund on domestic purchases of goods and services attributable to zero-rated sales. Adorbo said they have a different interpretation from that of the finance department, and will abide by their own.

alacañang on Wednesday deferred the announcement of the next government official to be fired by President Duterte. “Although I was directed to announce as early as December 30, the instruction was to announce in our next press briefing, which is today [Wednesday]. But, of course, the beginning of the day, I was asked to defer with the said announcement,” Presidential Spokesman Harry L. Roque Jr. said in his first Palace news briefing for 2018. Roque said no reason was cited for the postponement, but when he inquired with the Presidential Management Staff, “what they said is they gave the President a copy of the legislative charter of the agency headed by the officer.” “The President was reviewing the legislative charter of that agency,” Roque added. Roque clarified that the male official is neither from Philippine Charity Sweepstakes Office (PCSO) nor from the Energy Regulatory Commission (ERC). Last month the Ombudsman slapped four ERC commissioners and with one year and three months suspension after President Duterte removed ERC Chairman Jose Vicente Salazar over questionable contracts. Roque said the Office of the Executive Secretary is still studying the problem of the ERC. On the case of the PCSO, Roque said President Duterte knew already the looming conflict between PCSO General Manager Alexander Balutan and PCSO Board Member Sandra Cam. “I will make the confirmation that the official whom I was tasked to announce is not from the PCSO,” he said. Cam recently questioned the P6 million spent in a PCSO Christmas party held last December 19. Roque said Duterte is serious in cleansing the government of unscrupulous officials. “The President is also always guided by the Constitution that the government official must serve the republic, they must live a modest life and they must comply with the laws against graft and corruption,” he said. He explained that all presidential appointees serve at the pleasure of the President and that “the President does not even need to cite any good cause because that is the nature of the presidential appointee.” PNA

Economy

A4 Thursday, January 4, 2018 • Editors: Vittorio V. Vitug and Max V. de Leon

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PHL population seen breaching 107-million mark by year-end

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By Cai U. Ordinario

@cuo_bm

he Philippines is expected to continue seeing more babies born as the country’s population is expected to reach 107.19 million by year-end, according to the Commission on Population (Popcom).

In a news statement issued on Wednesday, Popcom Executive Director Juan Antonio Perez III said there will be 4,965 Filipinos added

per day or 206 babies born an hour in 2018. The Popcom said this is higher than the 193 babies born per hour

206

The projected number of babies being born every hour throughout 2018 or approximately three babies born a minute in 2017. “Based on the above projections, the Philippine population will increase by 1.8 million by the end of 2018, growing at a rate of 1.69

percent,” Perez said. Popcom noted that the population of the 15 to 64 age group increased by 0.16 percent to 63.88 percent, from 63.72 percent. The commission said this means there will be an increase in the number of working-age Filipinos and older persons, as well as a decreasing population under 14. “This leads to fewer children being born, providing an opportunity for demographic dividend that the government can capitalize on,” Popcom said. Meanwhile, Popcom also said another a noticeable increase will also be among women of reproductive age. By the end of 2018, there will

percentage of the total population,” Popcom said. On the other hand, Popcom added the age group over 60 continues to grow by almost fourth of a percentage or 0.23 percent over 2017 projections. By year-end 2018, there will be 8.01 million Filipinos over 60, constituting 8.2 percent of Filipinos. Of this group, around 5.08 million will be 65 and older. Most countries are considered aging if they have at least 7 percent of the population over 65 years old. The estimates made by the Popcom for 2018 are based on the Philippine Census of Population in 2015 using the geometric method.

Asia rebalancing to further improve Manila-Beijing

Neda lists priority projects for Board approval in 2018

economic ties this year–DOF

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HE National Economic and Development Authority (Neda) said at least four key infrastructure projects are being prioritized for approval by the Neda Board this year. Neda Undersecretary Rolando G. Tungpalan recently told reporters that these projects were already approved by the Investment Coordination Committee (ICC) in 2017. The projects include additional financing for the new Bohol Panglao International Airport project; Phase 1 of the Safe Philippines Project; Bridge Construction and Acceleration Project; and the Maritime Disaster Response Helicopter Acquisition. Tungpalan said more projects may be added to the list after the ICC Technical Board meets next week. The Bohol, airport involves the construction of an airport in Panglao Island, Bohol, to replace the existing Tagbilaran Airport, which had raised the project cost to P7.7 billion. The P20.313 billion worth Safe Philippines Project entails the construction of 18 i nteg rated operat ions a nd command centers that are complete with video surveillance systems and a remote back-up data center. The P11.369 billion worth Bridge Construction and Acceleration Project involves the construction of five iconic and 25 truss bridges. These will be constructed in nine regions of the country and will be completed by 2022 with a collective length of 2,848 lineal meters. The Maritime Disaster Response Helicopter Acquisition project aims to improve the capacity of the Philippine Coast Guard by acquiring six helicopters that will be used for marine disaster response. The President recently downsized the membership of the Neda Board to only 11 agencies and the ICC to only six agencies. The 11 agencies that are part of the Neda Board are the President, Secretaries of Neda, departments of Finance (DOF), Trade and Industry, Public Works and Highways, Budget (DBM), Transportation, Energy (DOE), the executive secretary, chairman of the Mindanao Development Authority and deputy governor of Bangko Sentral ng Pilipinas. T he Ned a Boa rd E xec utive Committee, which will be composed of the President, the secretaries of Neda, DOF, DBM and the executive secretary, was reactivated. As for the ICC, the members now include the secretaries of DOF, Neda, DBM, DOE, the executive secretary and the governor of BSP. Cai U. Ordinario

be around 27.71 million women of reproductive age or those aged between 15 and 49. This is an increase of over 400,000 from the previous year’s projection. These women are usually the beneficiaries of Reproductive Health services under the responsible parenthood and reproductive health law. With the increasing trend of pregnancies among 10- to14-yearold girls, the number of women and girls of reproductive age would be 33.11 million or 30.5 percent of the population. “The figures for women of reproductive age and adolescent girls continue to be the highest numbers on record, even with their decline in

By Rea Cu

@ReaCuBM

T Oil and tax

Energy officials, led by (from left) Rino E. Abad, director of the Oil Industry Management Bureau of the Department of Energy; Assistant Secretary Bodie Pulido and Spokesman Wimpy Fuentebella, discuss with the media the impact of the latest tax-reform package on the market pricing of fuel products. Nonie Reyes

Local manufacturing growth strongest in Asean for third consecutive month By Bianca Cuaresma @BcuaresmaBM

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he Philippine manufacturing sector grew the fastest anew in Southeast Asia last December, latest data showed, clocking in the country’s lead in the region for the third consecutive month. Global research firm IHS Market released on Monday the overall Nikkei Purchasing Managers Index (PMI) of its covered countries in the region, putting the Philippines at the number one spot again among its counterparts in the Association of South East Asian Nations. The Philippines’s PMI of 54.2, in particular, bested the performance of six other countries. It was followed by Vietnam’s 52.5, Myanmar’s 51.1 and Thailand’s 50.4.

This is the third consecutive month that the Philippines came on top of the Asean manufacturing sector performance. Those whose PMI fell below the 50-point threshold last December, meanwhile, were Malaysia at 49.9, Indonesia at 49.3 and coming in last was Singapore at 44.7. The PMI is a composite index, calculated as a weighted average of five individual subcomponents. Readings above 50 signal an improvement in business conditions, while readings below 50 show deterioration. The components include new orders—which weigh the most at 30 percent of the index; output—at 25 percent of the index; employment —at 20 percent; suppliers’ delivery times—15 percent; and stocks of purchases— comprising the other 10 percent. The Philippines is also seen as a rare

bright spot in the region in terms of manufacturing, as it is seen bucking the trend of a sluggish expansion in the beginning of 2018. “Other survey indicators suggest that the Asean manufacturing sector is likely to have a disappointing start to 2018. Firms scaled down buying activity, and continued to cut back on their inventory levels,” IHS Market principal economist Bernard Aw said. The principal economist’s outlook on the Asean manufacturing sector is a stark contrast to his outlook in the Philippine manufacturing sector, saying indicators in the country actually point out to a strong start for 2018. “Business expectations about output in the year ahead strengthened to a four-month high, while firms increased labor capacity and purchasing activity further during December,” Aw said.

he Philippines’s economic relationship with China is ex pected to improve further this year, mainly due to the Duterte administration’s foreign-policy rebalancing toward Asia, the Department of Finance (DOF) said. T he DOF sa id t he Ph i l ip pines’s economic relations with its neighbors in the region, foremost of which is China, showed improvement in 2017 following P resident D uter te’s foreig npol ic y reba l a nc i ng w it h a id , concessional financing and investment pledges from Beijing last year. Several agreements made by the Philippines and China are aimed to support the administration’s “Build, Build, Build ” program that will usher in the “golden age of infrastructure” in the country. “ T he unprecedented pledges of assistance from China that President Duter te had generated for the Philippines in 2017 make up the initial investment d iv idend f rom h i s presc ient foreig n-polic y reba lancing toward A sia,” Finance Secretar y Carlos G. Doming uez III said. According to the DOF’s International Finance Group (IFG), China has so far committed an estimated $7.34 billion in soft loans and grants to the Philippines for the implementation of 10 big-ticket projects, the construction of two bridges in Metro Manila, as well as two drug-rehabilitation facilities in Mindanao, and as aid to rehabilitate war-torn Marawi City. In October 2016, during the

four-day state visit, President Duterte harvested a total of $24 billion in investment and aid pledges. Of this amount, $9 billion are grants and other forms of assistance. The 14 accords forged between Manila and Beijing during Premier Li Keqiang’s visit in the country partly fulfills this commitment from China. On behalf of the Philippines, the finance chief had signed four of the 14 agreements with China. Topping this list is a financi n g c o o p e r a t i o n a g r e e m e nt signed by Dominguez and Liu Liange, president of the ExportImport Bank of China, for two of the Philippines’s f lagship infrastructure projects. This includes the New Centennial Water Source-Kaliwa Dam Project of the Metropolitan Waterworks and Sewerage System, and the Chico R iver Pump Ir r igation Project of the National Irrigation Administration that will cover 85 percent of the total contract amounts of the projects. China will provide soft loans estimated at $234.92 million for the Kaliwa Dam Project and $72.49 million for the Chico River Pump Irrigation Project under the first basket of infrastructure projects presented by the Philippines for possible Chinese financing, according to the IFG. According to the DOF, among the proposed projects under the second basket are the development of the Subic-Clark Railway, Davao City expressway and Panay-Guimaras-Negros InterIsland Bridge. “There are a number of other projects there [in the second basket],” Dominguez said.

DENR says forest protectors to undergo evaluation prior to issuance of firearms By Jonathan L. Mayuga @jonlmayuga

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orest-protection officers, or bantay gubat, will undergo psychological evaluation if the plan to provide them with firearms will push through, an official of the Department of Environment and Natural Resources (DENR) said. “ We are still study ing the idea. Personally, I believe some forest-protection officers should be allowed to carry firearms,” said Nonito Tamayo, director of the Forest Management Bureau (FMB) of the DENR, underscoring the risk DENR employees assigned as forest-protection officers, or even volunteers acting as bantay gubat, face in the performance of their duties. He added not all forest-protection officers may be qualified to carry firearms and a psychological evaluation may have to be conducted to make sure that those

who will be armed must not only be equipped with the skill, but are also emotionally and psychologically fit to carry firearms. Tamayo said that next year, the DENR, under Secretar y Roy A . Cimatu, w il l pursue the implementation of the ExpandedNational Greening Program (ENGP), a lthough the P2-bil lion budget cut of the agenc y, w il l likely affect the f lagship reforestation program. From the P29-billion budget in 2017, the DENR’s budget was slashed to P27 billion. This also means that the original E-NGP reforestation target of 229,000 hectares will be downsized to just 125,000 hectares. However, despite the reduction in the target for next forest plantations, Tamayo said there will be no let up in the campaign against environmental criminals, which include illegal loggers and poachers. “In fact, we are looking at deploying drones as part of the in-

tensified monitoring of our forest and faster response,” he told the BusinessMirror. The DENR is also intensifying the campaign against destructive development activities, such as quarrying and mining, slash-andburn agriculture and illegal wildlife trade, particularly harvesting and hunting of threatened plant and animal wildlife. It was Cimatu who first came up with the idea of arming the DENR’s forest-protection officers following the death of a barangay captain, Ruben Arzaga, in El Nido, Palawan. Arzaga, 49, was named “Bayani ng Kalikasan” for sacrificing his life in protecting the forest of Palawan. He was an active member of the El Nido-Taytay Managed Resource Protected Area Management Board. On September 14, 2017, he was shot dead by suspected illegal loggers whom he and a team from the local environmental law enforcers

In fact, we are looking at deploying drones as part of the intensified monitoring of our forest and faster response.” —Tamayo

attempted to apprehend in Sitio Batbat, Villa Libertad. Two of the suspects were later arrested and charged with murder and four counts of attempted murder. The attack was the second incident on forest-protection officers by illegal loggers and timber poachers in Palawan within a span of three weeks.

Last August 23 DENR forester Lito Eyala was shot and injured by a suspected timber poacher while he and his team were patroling the mountains of Barangay Bacungan in Puerto Princesa City, Palawan. Eyala sustained two gunshot wounds one in the back of the body and one in the nape. The two incidents prompted the DENR chief to seek the help of the police and the military as he vowed to strengthen the agency’s community environment and natural resources offices. The Armed Forces of the Philippi nes’s Wester n Com m a nd (Wescom) and the Palawan Philippine National Police was sought to address the issue of illegal logging in Palawan by conducting regular patrol, and the conduct of joint operations in the area. Wescom will also train forestprotection officers on basic security measures, including the use of firearms for “self-defense.”

Agriculture/Commodities BusinessMirror

www.businessmirror.com.ph

Editor: Jennifer A. Ng • Thursday, January 4, 2018

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Firms, groups seek govt OK to import rice By Jasper Emmanuel Y. Arcalas

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@jearcalas

Job vacancies in agri firms more than doubled in 2016–PSA

he National Food Authority (NFA) said 297 companies and farmers’ organizations have applied for permits to import more than 2 million metric tons (MMT) of rice under the minimum access volume (MAV) scheme.

The NFA, the private firms and farmers’ organizations would purchase some 2.2 MMT of imported rice, nearly triple the 850,200 metric tons (MT) of the country’s MAV for 2017. Imports within MAV are usually slapped a lower tariff. “The NFA was able to generate P14.8 million from the nonrefundable application fee of P50,000 from each MAV applicant, while P2.4 billion was remitted to the national treasury as advance payment of customs duties made by 156 applicants as of December 15,” the NFA said in a recent statement. Under Memorandum Circular AO-2017-08-002, which detailed the guidelines for the MAV 2017 importation, rice traders will be allowed to source from countries with a specific quota and from omnibus origin, or other

rice-producing countries. Of the total applicants, 266 private firms and farmers’ organizations want to import 2.028 MMT of rice from Thailand, Vietnam, Pakistan and India. The remaining 31 rice traders will buy 171,971 MT from other rice-producing countries. However, rice traders and farmers’ groups can only import 293,100 MT of rice from Thailand and Vietnam. They can also import 50,000 MT of rice from China, India and Pakistan; 15,000 MT from Australia; and 4,000 MT from El Salvador. Under the importation guidelines, if the total applied volume under the MAV exceeds the quota, then the NFA will distribute the import allocation on a pro rata basis among the qualified applicants. Well-milled rice imported un-

By Cai U. Ordinario @cuo_bm

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In this file photo, a worker arranges sacks of rice at a National Food Authority warehouse. The government allows the private sector to import rice under the minimum access volume scheme to boost local supply. NONIE REYES

der the 2017 MAV program will be slapped a 35-percent tariff, according to the importation guidelines. The quality should also not lower be than 25-percent brokens and/ or any special rice variety. The importation guidelines also indicated that after all importers

have filed their letter of intent, the NFA MAV prequalification team will conduct the validation and authentication of all the requirements submitted by the applicants. The NFA Council, the highest policy-making body of the NFA, has divided the arrival of rice

imports under the 2017 MAV into two phases: from December 20, 2017, until February 28; and June 1 until August 31. The NFA said the council did this to ensure that the arrival of rice imports will not coincide with the harvest season.

Loans extended to farmers, fishermen hit ₧642.29B in 2016

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ilipino farmers and fishermen borrowed P642.29 billion from private and government banks in 2016, 13.52 percent higher than the P565.777 billion recorded in 2015, according to the Philippine Statistics Authority (PSA). In its annual report, titled “Agricultural Indicators System: Agricultural Credit,” the PSA said 46.75 percent of the loans granted to farmers and fishermen were used for production activities. “Of the total agricultural loans, about 46.75 percent, or P300.29 billion, were allocated for production purposes,” the PSA said in its report

published on January 3. Data from the PSA showed that total agricultural production loans granted to farmers and fishermen in 2016 were nearly 12 percent higher than the P267.135 billion posted in 2015. The PSA said private banks remained as the top source of agricultural production loans, accounting for 82.7 percent, or P248.4 billion. The figure was 11.78 percent higher than the P222.22 billion granted by private banks to farmers and fishermen in 2015. “In terms of the amount of loans provided by the private banks, the

Private Commercial Banks (PKBs) had the biggest share at 36.3 percent of the total production loans. This was followed by Rural Banks at 22.5 percent, while Savings and Mortgage Banks and Private Development Banks recorded 9.7 percent and 8.2 percent shares, respectively,” the report read. “The loans supplied by the Stocks Savings and Loan Associations continuously reported the least share with 6.1 percent in 2016,” it added. PKBs granted a total of P108.99 billion of loans to farmers and fishermen in 2016, nearly 20 percent higher than the P91.07 billion recorded in 2015. Loans borrowed by

farmers and fishermen from PDBs grew 8.10 percent to P24.67 billion in 2016, from the previous year’s P22.822 billion. In 2016 loans granted by SMBs, SSLAs and RBs to farmers and fishermen reached P28.99 billion, P18.185 billion and P67.55 billion, respectively. “Nearly 6-percent expansion in the volume of lendings was noted each in the other private banks,” the report read. The remaining 13.7 percent of total agricultural production loans, amounting to P51.9 billion, were granted by government banks,

according to the PSA. This was 13.02 percent higher than 2015’s P45.92 billion. “For the government lendings, the Land Bank of the Philippines [LandBank] and Development Bank of the Philippines (DBP) expanded their credit assistance by 13.13 percent and 8.88 percent, respectively, but this was lower than last year’s growth rates,” the PSA said. The LandBank, which accounted for 97 percent of total government agricultural production loans, granted P50.561 billion, while the DBP accounted for P1.334 billion. Jasper Emmanuel Y. Arcalas

The new year ushers in a new style of farming and dining “Food is the one central thing about human experience that can open up both our senses and our conscience to our place in the world.” —Alice Waters

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nstead of writing down resolutions for the new year, I prefer to set intentions of the year and move forward for there. For this year, my intentions will be the same as 2017’s: Trust my intuition and manifest abundance. These intentions will continue to guide my actions this 2018, hence my continued advocacy for sustainable farming and dining. After all, what better way to manifest abundance than to eat food that nourish not only one’s body and soul, but will also benefit the small farmers and fishermen and ensure that the land and water resources will keep on producing enough food for everyone? This is also the reason for my first column for the year, I decided to list down some ideas that can help you to start or continue with your sustainable dining regimen.

Know your why

It’s a trend now: farm-to-table dining, third wave cafes, bean to bar chocolates, artisanal food, weekend markets. You might have purchased some of these items and/or dined in one of these restaurants. It probably started out of curiosity, enticed by what you’ve read in your social-media feed or what you’ve heard from your colleagues. But after you got your taste and you still want to continue with this kind of dining lifestyle, you might want to know why you want to get into it. Is

it because it’s healthy? Does it support one of your advocacies, such as animal welfare and environmentalism? Would it make you a better food blogger or social-media influencer? Whatever your reasons are, your first step toward sustainable dining is to read more about it. There are so many free resources available online now and many books have been written about anything related to sustainable dining and farming. Some books that I can personally recommend are The Omnivore’s Dilemma by Michael Pollan, Fast Food Nation by Eric Schlosser, Diet for a Small Planet by Frances Moore Lappe, Hope’s Edge by Frances Moore Lappe and Anna Lappe and Animal, Vegetable, Miracle: A Year of Food Life by Barbara Kingsolver. My journey toward sustainable dining started 20 years ago after buying an old copy of Diet for a Small Planet by Frances Moore Lappe where I learned livestock raising (specifically cattle raising) used up so much of the Earth’s resources. It was also around that time that I discovered yoga and meditation in a shala founded by Ananda Marga monks. These two events encouraged me to become a vegetarian, believing that it would be better for my health and the environment (which has always been one of my pet advocacies). I’m no longer a vegetarian, but I continue to be conscious about the benefits of having more vegetables in my diet. I’m also fortunate enough that my job as an agribusiness/commodities journalist has given me numerous opportunities to learn from interviews with farmers, non-governmental

Prime Sarmiento

prime commodities organization workers, scientists, doctors and entrepreneurs on the need for sustainable farming systems like organic agriculture and agroecology.

Take baby steps

You don’t need to throw away all the contents of your pantry or force your entire family to get into the program just because you decided you will just consume organic vegetables from now on. Like any kind of advocacy or lifestyle change, you can start by taking baby steps. Perhaps, instead of buying those 3-in1 coffee packets, you can replace it with brewed coffee made from beans sourced directly from coffee farmers and sweetened by coconut sugar or honey produced by cooperatives and indigenous groups. I know that some shops like the Echostore chain of retail outlets and Ritual store in Makati sell these items. Or you can spend one Sunday buying organic and artisanal food from entrepreneurs in weekend markets, such as those in Legazpi and Salcedo in Makati, Mandala Park’s weekend market in Mandaluyong and Sidcor Weekend Market in Quezon City. Talk to the vendors and learn more about how the products were prepared, how those vegetables were grown, and how you can use them to prepare your

meals at home. Another baby step is to give yourself the occasional treat of dining in one of these farm-to-table restaurants that have sprouted in Makati, Ortigas and Bonifacio Global City. They’re pricey but it will make you rethink why you’re not eating such good meals every day.

Dig deeper

And I meant that in a literal sense—that is, dig your own soil by having your own garden. Nothing will make you understand more about the importance of sustainability by nurturing plants and harvesting the fruits—literally—of your own labor. And no, you don’t need a big plot of land to be able to garden. Container gardening can be done even in a condo—you just need pots, soil and a window that can bring in sunlight. When you garden, you will learn the importance of soil fertility, why crop diversity is better than drenching your crops with pesticides, or how compost can help you reduce waste. You will also learn why it’s better to eat and buy only what’s in season—they taste better and cheaper.

Not everything is in black or white

My problem sometimes with those who are treading this path of sustainability is the holier-than-thou posture of some of its advocates. They have this my-way-or-thehighway attitude, making you feel guilty for buying packaged food from huge food manufacturing conglomerates or relishing that burger and French fries you bought from a fast-food restaurant.

The thing is, nothing in this world is in entirely good or evil. There are only several shades of gray and it’s up to you how you will live your life without being judgmental of other people’s (or even your own) choices. You might want to boycott that fast-food restaurant because they serve unhealthy food or because you are a vegan who thinks eating these burgers promote cruelty to animals. But did you even stop to consider that these restaurants that you are boycotting provide jobs to thousands of working students who rely on their wages to pay for their tuition and build a better life? The food manufacturers and industrial agribusiness farms that you might be demonizing employ thousands of workers and also provide affordable food items (and convenience) to millions of households who have limited food budgets. There’s a way for you to consume organic vegetables bought directly from a farmers’ cooperatives, while, at the same time, continue buying processed food from big food manufacturers. It might seem contradictory, but our lives are always full of contradictions. It is up to us to reconcile our deeply held beliefs with our personal choices.

Prime Sarmiento is a longtime business journalist who specializes in food, agribusiness and commodities-trade reporting. Her stories have been published in both local and international publications, including Nikkei Asian Review, China Daily, Science and Development News Network and Dow Jones Newswires. Comments and ideas are welcome at prime.sarmiento@gmail.com.

stablishments in the farm and industry sectors needed more workers in 2016, according to the results of the 2015-2016 Integrated Survey on Labor and Employment (ISLE) released recently by the Philippine Statistics Authority (PSA). Data showed that in 2016, the number of vacancies in the agriculture sector rose by 132 percent to 6,733, from 2,896 in 2014. In the industry sector, there was a 25-percent increase in job vacancies to 177,889 positions in 2016, from 142,185 in 2014. “This issue presents statistics on job openings or vacancies that were made available for placements by establishments during the 18-month period covering January 2015 to June 2016,” the PSA said. According to the PSA, the total number of job vacancies fell by 7.22 percent to 698,683 in 2016, from 753,092 in 2014. This is despite a 12-percent hike in the number of applicants for the same period. This may be due to the 15.45-percent drop in job vacancies in the Services Sector, to 514,060 positions in 2016, from 608,011 in 2014. Data from the PSA showed that the steepest declines in job openings were recorded in the repair of computers and personal and household goods; other personal service activities with a contraction of 39.86 percent, followed by accommodation and food services activities at 31.32 percent. Of the total 31,277 establishments, 51.6 percent, or 16,144 establishments, reported that they are in need of additional workers. Of the total vacancies reported, 460,069, or 65.8 percent, were regular positions and the rest were nonregular positions. During the period, a number of job vacancies represented occupations that are common across industry groups. These included managers and supervisors, such as those for finance, human resource and sales; professionals, such as nurses, accountants, advertising and marketing professionals; technicians and associate professional, such as commercial sales reps, accounting associate professionals; and clerks, such as secretaries and data entry clerks. The list included service workers, such as security guards and teaching aides; craft and related trades workers, such as carpenters and electricians; machine operators, car and taxi drivers and heavy truck and lorry drivers; and laborers, cleaners and helpers, as well as civil engineering laborers. Conducted every two years, the ISLE is a nationwide sample survey covering agricultural and nonagricultural establishments with 20 or more workers. The latest survey covered 12,926 establishments.

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TheBroa

Business

Thursday, January 4, 2018

PROJECT MNL: PR O

By Cai U. Ordinario

VERCROWDING and delayed flights due to long takeoff queues have made the Ninoy Aquino International Airport (Naia) one of the world’s worst airports.

Measures to improve the facilities of the existing international airport have long been planned. As far back as the 1970s, the Marcos government has toyed with a number of proposals that could increase the capacity of the Manila International Airport, later named the Naia. However, these plans were not implemented. Fast forward to today, the millions of tourists and Filipinos traveling to and from various international destinations have made the implementation of these plans critical. Before the end of the Aquino administration, San Miguel Corp. (SMC) submitted an unsolicited proposal to build a new airport. However, the previous administration’s policy of focusing its efforts on solicited proposals for infrastructure projects placed the SMC’s proposition in the back burner. Consistent with the change in administration was a change in policies. The Duterte administration, realizing the amount of projects that are needed to address the country’s gnawing infrastructure constraints, made a decision to open its doors to unsolicited proposals. “The airport project in Bulacan is still not dead. It’s still being considered,” Socioeconomic Planning Secretary Ernesto M. Pernia told reporters last year. “It’s just going to go through the usual process. There’s no special treatment, no commitment.” With the doors wide open, SMC became even more determined to push for the construction of a new airport. This move encouraged seven other conglomerates to join the fray. With such a huge interest in building a new airport and also the rehabilitation of the Naia, the government is faced with a myriad of choices in terms of providing better airport facilities for Filipinos and visitors wanting to explore the wonders of the Philippines. The only question is when this will happen and who will do it.

Sangley proposal

DECIDING on how to improve airport facilities at the Naia is difficult. Documents obtained by the BusinessMirror showed the government studied several solutions to address the need for a modern international hub for air travel. The first option was to improve the existing Naia airport. The primary advantage of this option was the fact that the Naia is proximate to Metro Manila. However, its disadvantages showed that at 625 hectares, the Naia simply did not have room to expand the airport’s facilities. This means any improvement will only lead to short-term solutions to ease traffic congestion and accommodate more passengers. Currently, the Naia has already exceeded its annual passenger capacity. A consortium of conglomerates said, however, it believes that Naia “will continue to be a strategic gateway and a key hub of airline operations for the Philippines.” “With proper upgrades and strategic improvements, Naia can easily accommodate an additional 11 million passengers annually

(Or will the proposal by San Miguel Cor

from the current 39.5 million passengers, and can increase its hourly aircraft movements from 40 movements per hour to 48 movements per hour,” the consortium led by the Ayala group said. The second option was to develop Sangley Point, Cavite City, as a premier gateway. Its advantages included its proximity to Manila since it was only 12 kilometers from Naia and it can also be accessed via the Cavite Expressway. However, the disadvantages include the need to reclaim more land to create two runways. There is also a need to address environmental issues, and the airport in Sangley Point currently does not operate as a commercial airport.

Dual system

ANOTHER solution is a dual airport system wherein the Naia and the Clark International Airport (CIA) will operate together to serve passengers and tourists. This means utilizing the CIA’s existing facilities and that the CIA has room to expand its facilities. The primary disadvantage of using Clark is its 90-kilometer distance from Manila, which entails a three-hour drive or land travel. Another option under the dual airport scheme is the Naia and Sangley Point combination. The primary advantage of this is, again, the proximity of the latter to Metro Manila. However, a number of disadvantages have been identified. These include encountering aviation safety issues if Sangley is developed into a commercial airport, as well as an increase in the probability of bird strikes due to a bird sanctuary nearby. Operating Sangley and Naia together as commercial airports may not be approved by the Civil Aviation Authority of the Philippines (CAAP) due to the 24-kilometer single-aerodrome minimum distance between operating airports. Further, operating Sangley could potentially worsen the traffic congestion, especially on the roads to and from Cavite City due to the number of passengers and tourists expected to enter and exit the airport. Apart from these, other companies also proposed their respective ideas for a new airport. The DM Wenceslao group proposed a combined airport and shipping port project in Sangley Point. The Sy and Tieng group, on the other hand, is proposing a $50-billion-worth airport and economic zone also in Sangley Point.

Other proposals

THE National Economic and Development Authority (Neda) said the privately held New San Jose Builders Inc. has also proposed to include an airport in its Manila Bay flood defense project, while the Okada group is looking to increase its investments in the country by participating in the bidding for the NMIA. The various proposals and high interest among private-sector players have initially led the Neda to propose that the Department of Transportation (DOTr) just go through competitive bidding. This was the content of a let-

ter to Transportation Secretary Arthur Tugade dated October 27, 2016, signed by Neda Undersecretary and, at that time, Officer in Charge Rolando G. Tungpalan, sent in response to the request by the DOTr to review the unsolicited airport proposal made by SMC. “Given the numerous proposals received with regard to the development of NMIA, you may wish to subject the project to a competitive bidding rather than through unsolicited mode, unless the SMHC [San Miguel Holdings Corp.] has been accorded by your department an original proponent

With such a huge interest in building a new airport and also the rehabilitation of the Naia, the government is faced with a myriad of choices in terms of providing better airport facilities for Filipinos and visitors wanting to explore the wonders of the Philippines. The only question is when this will happen and who will do it.

aderLook

sMirror

www.businessmirror.com.ph | Thursday, January 4, 2018

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REMIER GATEWAY Airport facilities will include air cargo, aircraft maintenance, catering/flight kitchen, ground support, airport management and maintenance, rescue and fire-fighting services, police, fuel storage, an air-traffic control complex and fixed-based operators. These facilities and project details come at a cost of P735.63 billion, using 2017 current prices. The bulk of the amount, or P641.53 billion, will be allocated as capital cost, particularly for land development, design, construction, contingency and insurance. The remaining P94.1 billion will be the financing cost for the project. “The total project cost will be borne by SMHC through a buildown-transfer (BOT) arrangement with no cost required from the government,” the documents stated. “The proponent intends to finance the development of the project through a mix of bank loan and private-sector equity involving a 70 percent-30 percent debt-equity ratio,” it added.

rp. for a new international airport fly?)

Additional info

DOCUMENTS stated that publicly listed SMC estimates passenger forecast for 2023 will reach 46.7 million passengers per annum (mppa). SMC estimates that figure will increase to 66 mppa in 2030, 78.3 mppa in 2035, 92.8 mppa in 2040 and 100 mppa in 2045 and 2050. The construction of the airport will take six years. Under the initial estimate provided in the documents obtained by the BusinessMirror, if the concession agreement was signed last year, the project would be completed by 2022 and commence operation in 2023. However, according to Neda Undersecretary Rolando G. Tungpalan, the project has not been discussed at the ICC yet. Tungpalan said the interagency Investment Coordination Committee (ICC) has asked the DOTr to submit additional information on the project before the ICC Technical Board can approve the proposal. “We asked DOTr to submit additional information to enable us to validate some of the assumptions. DOTr has submitted information, [but] I don’t know if it has already been assessed by the appraising offices,” Tungpalan said. The Neda official said some of these information pertain to the Financial Internal Rate of Return (FIRR) that would serve as the “parameter for [the] Swiss Challenge.” Tungpalan said the ICC Technical Board is set to meet on January 11. If the assumptions for the FIRR have been made based on the latest submission of the DOTr, the project may be given first-pass approval at the ICC.

TOM19275 | DREAMSTIME.COM

Opposing views

status,” according to a copy of the letter obtained by the BusinessMirror. To note, SMC conducts its infrastructure business through subsidiary SMHC. However, when the DOTr finally gave the original proponent status to SMC last year and backed by the policy direction of the administration to accept unsolicited proposals, this started the journey of the SMC airport proposal in the DOTr until it reached the ICC Secretariat on October 13, 2017.

Unsolicited proposals

ACCORDING to the guidelines

of the Public-Private Partnership (PPP) Center, unsolicited proposals are project proposals submitted by the private sector not in response to a formal solicitation or request of the national government. These projects are accepted if they involve a new concept or technology and/or are not part of the list of priority projects, no direct government guarantee, subsidy or equity is required and are not a component of an approved project. Also, the government should have invited by publication for three consecutive weeks comparative or competitive pro-

posals. If no other proposal is received in 60 working days, the government grants the project to the proponent. However, if a lower-priced proposal is received within 60 working days, the original proponent has the right to match the price within 30 working days.

SMC solution

THE airport project proposed by SMC involves the construction, operation and maintenance of the new international airport in the company’s 2,500-hectare property in Bulakan, Bulacan. The location of the proposed airport is a first-

class municipality that is 35 kilometers north of Metro Manila. As of 2015, the municipality has a current population of 76,565. Of the total land area, around 1,138 hectares will be allocated for the actual airport with a 100-hectare government center area and 1,132 hectares for other developments. The airport will have two runways for domestic flights and two runways for international flights. The design allows for an expansion of another two runways. The parallel runways will allow 240 movements per hour or 60 movements per hour per runway.

AS the agency tasked to handle public-private undertakings, the PPP Center was tasked to provide its inputs on the proposed project. Included in its comments in a document obtained by the BusinessMirror is the PPP’s recommendation that the project be undertaken in phases. Comparing the cost estimates of various airports in the region, data showed the proposed NMIA will be among the second most expensive at around $14.6 billion using a P50-to-$1 exchange rate. The most expensive is the Hong Kong International Airport (HKIA) Planned Expansion, which is estimated to cost $18 billion. The least costly is Indonesia’s Soekarno-Hatta International Airport at $1 billion. However, the NMIA will have the most capacity at 100 mppa followed by Thailand’s Suvarnabhumi Airport at 45 mppa. The HKIA

Planned Expansion will also see over 40 million passengers per annum. “Since there is a possibility of having two Manila airports operated simultaneously, resulting in lower passenger projections, it may be prudent to consider phasing the construction of the airport to lower initial capital expenditure,” the PPP Center stated. Further, the PPP Center expressed its reservations given the assumption of SMC’s passenger forecast for the NMIA. The agency noted as the SMC assumes a 100-percent transfer of Naia passengers to NMIA, it can lead to an assumption of the closure of the Naia. The PPP Center said the latter direction remains a policy decision of the government. The agency stated, however, the closure of the Naia could cause potential economic harm given that the financial assumptions for the NMIA are hinged on this assumption. Apart from these, the agency also made comments on the legal/ institutional evaluation of the project, technical market study, financial evaluation, and provisions in the draft concession agreement.

Mega-consortium

AS the SMC proposal is being studied, seven conglomerates moved to create a consortium to rehabilitate, operate and maintain the Naia. The companies made the announcement in several disclosures at the local bourse in December last year. Based on their disclosure, the companies said they agreed to form a consortium composed of the parent firms and their subsidiaries. These included Metro Pacific Investments Corp., Andrew Tan’s Alliance Global Group Inc., the Gotianuns’ Filinvest Development Corp. and the Gokongwei family’s JG Summit Holdings Inc. The subsidiaries in the consortium are Aboitiz InfraCapital Inc. of Aboitiz Equity Ventures Inc., AC Infrastructure Holdings Corp. of Ayala Corp. and Lucio Tan’s Asia’s Emerging Dragons Corp. The combined market capitalization—how a company is worth or valued by investors—of the parent of the three subsidiaries is already worth P1.2 trillion, according to the BusinessMirror’s computation. The consortium said, “The Naia will continue to be a strategic gateway for our country and a key hub of airline operations for many more years.” It said that given proper upgrades and strategic improvements, the Naia can easily accommodate an additional 11 million passengers annually from the current 39.5 million passengers, and can increase its hourly aircraft movements—landing and takeoff—from 40 movements per hour to 48 movements per hour.

Waiting lounge

THE final word is not yet out on the fate of the NMIA. The crucial meeting of the ICC will be on January 11, where many of the current administration’s key infrastructure projects will be discussed and evaluated. If the ICC Technical Board includes the NMIA in its discussions and finally decides to accept the proposal, this will be elevated to the ICC Cabinet Committee then to the Neda Board, which is chaired to the President. However, the Neda assured that all projects, including the NMIA, will only spend 60 days in the ICC’s hands. This ensures the speed and quality of the approvals that are crucial in moving the President’s infrastructure initiative a true success. Until then, passengers and tourists will have to grin and bear it in one of the world’s worst airports.

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Banking&Finance BusinessMirror

Thursday, January 4, 2018 • Editor: Jun B. Vallecera

www.businessmirror.com.ph

HSBC recalibrates Manila’s 2017 growth path anew to 6.7%

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he financial-services giant HSBC ramped up yet again the country’s local output growth, measured as the GDP, to 6.7 percent in 2017 from only 6.5 percent announced 12 months earlier. The ramping up extends to growth prospects this year when the $305-billion economy was seen sustaining the pace of expansion also at 6.7 percent. HSBC economist Frederic Neumann and colleague Qu Hongbin, in scanning the output potential of economies across Asia, said the Philippines “stands on solid ground as one of Asia’s growth leaders, and it will likely stay in that position in 2018, as well.” “The country contributed to Asia’s host of upside surprises on growth in Q3 2017, expanding an impressive 6.9 percent yearon-year [YOY] [Q2: 6.7 percent]. The composition of this growth suggests that the country is firing on all cylinders, with all expenditure components contributing positively for the first time since 2014,” the duo said. They traced the continuing expansion to strong private consumption and fixed investment as the main growth driver, noting that the former contributed 3 percentage points, while the latter contributed a separate 2 percentage points to growth in the third quarter when the economy delivered growth averaging 6.9 percent. “But there are more encouraging

signs in the data. Government spending has been a substantial contributor to growth this year, adding 0.9-percentage point in both Q2 and Q3, far above the long-term trend of 0.4 percentage points. This is an important development, if it persists, as it could suggest that the government is finally curbing its historical pattern of under spending,” the duo added. However, the duo threw a word of caution on prospective expansion, noting particularly the moderation happening in fixed investment, “which slowed for the fifth straight quarter in Q3.” “We focus particularly on the construction sector, where the private sector accounts for about 80 percent of the total figure. Private construction grew just 0.6 percent YOY in Q3 [Q2: 5.1 percent], while public construction picked up some of the slack, growing 12.6 percent YOY [Q2: 12.1 percent]. “This is due partly to the government’s shift away from public-private partnership projects. We expect public construction to expand further in 2018 as the government embarks on a more aggressive infrastructure program and boosts infrastructure

spending to 7.2 percent of GDP by 2022. However, private construction will need to remain a steady contributor to investment, or it could become a drag on growth in 2018,” the duo said. The country’s forecast growth in 2017 and the year ahead compares favorably against forecast expansion in China, whose supersized economy was seen expanding at the same 6.7-percent growth rate. HSBC noted that China’s continued expansion in 2017 and the year ahead may prove slightly lower than previous as construction there has slowed and Chinese regulators have begun a tightening cycle. China’s rapid growth had been made possible by massive lending in the past until last year, when regulatory measures were adopted in earnest that caused real-estate investments to dip and for local government spending, which have been similarly massive, to ease by a significant degree. “Swifter and more determined state-owned enterprise restructuring could also curb industrial employment and weigh on consumption, at least at the margin. Still, HSBC believes other sectors, such as high-tech investment and services, will take up the slack, along with decent export growth. That should keep GDP expanding at 6.7 percent on average in 2017, roughly the same pace as in the third quarter,” the duo added. They also noted that inflation has proven well-behaved during the period, averaging well within the target of 2 percent to 4 percent at only 3.2 percent in the first 11 months, based on data from the Bangko Sentral ng Pilipinas (BSP).

As a result, the lender said the BSP was likely to keep the rate at which it borrows from banks and financial institutions steady at 3 percent for now, although the same may be raised to 3.25 percent in the April-to-June quarter. “We thus expect the BSP to hike the reverse repo rate by 25-basis points in Q2 2018, to 3.25 percent, to prevent any unanticipated rise in inflation toward year-end. If this were to happen, however, we believe it would be a shallow hiking cycle and done only to moderate inflation pressures and to close the gap between the weighted average of the term-deposit facility rates, which is around 3.5 percent, and the reverse repo rate. After this initial hike, we do not expect another policy rate hike until Q3 2019,” they said. As to what could jeopardize the economic gains achieved thus far, the duo cited the possible failure to break ground on key infrastructure projects going forward when the government under President Duterte “reverts to its historical under spending.” “A realization of those risks could reduce investor and business confidence and drag down growth. Moreover, recent labor statistics suggest that the country’s workforce is gradually shifting from agriculture to construction in an effort to take part in the government’s infrastructure push. This has led to a recent uptick in male unemployment. For now, we believe this development is largely transitory and frictional in nature, but it poses downside risks to growth if the economy is unable to absorb these workers and/or the government is unable to fully realize its infrastructure plan,” the lender said. Jun B. Vallecera

China seen raising money-market rates three times this year

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hina’s central bank will make modest increases in moneymarket rates in 2018 as it aims to keep up the pressure on deleveraging and prevent too much divergence with United States policy, according to a Bloomberg survey. T he People’s Bank of China (PBOC) is seen raising interest rates on reverse-repurchase agreements by five basis points three times this year, starting in the first quarter, the survey shows. That would raise the rate—now at 2.5 percent—more slowly than last year, when policy makers lifted it by five basis points in December after two 10 basis-point hikes in the first quarter. Economists don’t forecast any change to the benchmark rate, which sets borrowing costs economy-wide, through early-2020, according to a separate survey by Bloomberg. The central bank has kept the one-year lending rate unchanged since October 2015. Here’s where 31 analysts surveyed December 15 to 27 see open market operation rates at the end of each quarter: 1Q 2Q 3Q 4Q seven-day reverse 2.55 2.60 2.60 2.65 repo rate

Such a trajectory would help keep China more in step with the US Federal Reserve (the Fed), which projects three hikes of its own this year, and help Beijing maintain financial stability by keeping liquidity tight and preventing capital outflows. The PBOC surprised investors last month by following the Fed’s quarter-point increase with its own smaller move. The PBOC is more likely to raise open-market interest rates in the first

half because there will probably be more headwinds for the economy in the latter six months, according to Wang Yifeng, a Beijing-based analyst at China Minsheng Banking Corp.’s research institute. “A de facto tightening bias will be the main policy stance, which helps balance cutting leverage and stabilizing growth,” he said. “It’s difficult to see monetary policy easing for quite a long period of time.” A summit of China’s economic policy makers led by President Xi Jinping last month set risk prevention as the top “critical battle” for the next three years. The annual Central Economic Work Conference took a stronger tone than the prior year, by pronouncing that the floodgates of monetary supply should be “controlled,” compared with the prior year’s announcement calling for “adjustment.” Forecasters also project a broadbased cut to the reserve requirement ratio in the fourth quarter, to 16.5 percent from 17 percent, separate surveys show. That’s in addition to a targeted reduction to help small business that was announced last year and took effect on January 1. Still, the PBOC may not fully follow Fed interest rate hikes this year, Liu Li-gang, chief China economist at Citigroup Inc. in Hong Kong, said on Wednesday in a Bloomberg Television interview. The central bank is likely to make a maximum of two increases to its overnight Standing Lending Facility, which sets a ceiling for PBOC rates, but “if the financial tightening were to be too excessive, we can’t exclude an RRR cut,” Liu said.

How banking is getting personal More moderate inflation seen last December

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igital technolog y has already transformed how people can bank, making it quicker and more convenient for them to access their money. In 2018 digital banking is going to take a further step forward as new rules allow technology advances to benefit consumers. To give just one example, applying for an overdraft or mortgage has been a time-consuming process, involving visits to your branch and lengthy conversations before you received the green light. Today, with computer programs capable of amassing and analyzing complex information quickly, banks can make decisions almost instantly, sometimes without even needing to meet their customers. In fact, in many ways banks in the information age know their customers better than ever before. Algorithms have helped to make banking more personal. In 2018 new European Union rules on open banking should take this further. For the first time people will be able to give permission for their data to be shared across different financial organizations. This will drive innovation across the industry, paving the way for apps and products that allow customers to view all their accounts in one place and manage their finances more easily. Crucially, the new rules will also give individual banks a clearer picture of their customers’ needs, helping tailor and personalize the services that they offer. In the same way that shopping web sites and television-streaming services can recommend products that a customer might appreciate, increasingly their bank will be able to offer suggestions that could make life easier—such as nudges about when to save money, or suitable home insurance options when it’s time to renew. For people with outstanding debt, banks could offer simple,

plain English advice on how to manage their finances. The coming year will also see further advances in technology that will create a more personal and relevant banking experience. For instance, we should see a rise in robo-advisers—web-based services that make recommendations on investments, taking account of factors, such as the customer’s age and risk appetite. In essence, these programs will make financial advice available to many who previously could not afford professional help. Meanwhile, more and more banks will turn to biometric verification—such as voice, face and fingerprint recognition—as a means of allowing people to access their money. These features are unique to each of us, and operate as part of a sophisticated set of services to protect customers’ money and data. As smartphone technology advances, new models are often configured to offer a broader range of identification techniques as standard. Of course the availability of such technology does not mean customers will automatically embrace it. Only 19 per cent of people currently say they would trust a robo-adviser to help them make investment decisions, according to HSBC’s Trust in Technology report, which surveyed more than 12,000 people across 11 countries. The move toward open banking also raises concerns about the risk of security breaches. Not everyone will feel comfortable allowing greater access to their data. The onus is on banks to show that they will handle information securely, build in safeguards to new systems and, above all, give customers a clear explanation of the changes they are making and why. But if the financial industry can respond to these challenges, it will ultimately mean greater choice and more responsive services for customers within a safe and secure framework. HSBC

By Rea Cu

@ReaCuBM

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rice pressures last December may have eased further during the month and caused inflation to average still lower to 3.2 percent, according to calculations made by the Department of Finance (DOF). In its latest economic bulletin, the DOF said inflation last December likely settled to only 3.2 percent, or a contraction from 3.3 percent the previous November. On annual basis, however, the forecast inflation last December was an expansion, since the inflation rate in the same month in 2016 averaged only 2.6 percent. “Inflation last December was seen to have moderated to 3.2

percent, down from the previous month’s 3.3 percent, on the back of more stable food prices and lower power costs,” the DOF said. The price of food and nonalcoholic beverages for the period was seen remaining at the 3.2 percent level, or a contraction from 3.6 percent in December 2016. The price of rice was seen steady at 1 percent, the same rate posted in November 2017. The price of alcoholic beverages and tobacco products was seen a bit higher to 6.2 percent during the month from the previous 6.1 percent, but an easing from inflation of only 6.3 percent in December 2016. “Low inflation is an indication that the country’s macroeconomic

Takeaways from Dubai

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he Dubai Association Centre (DAC) invited me as one of over 30 international speakers at its inaugural Dubai Association Conference held last December 11 and 12, 2017 at the Dubai Trade Centre. The event was attended by more than 300 participants, mostly association executives and professionals like me from around the world. I was the lone Filipino speaker and represented the Philippine Council of Associations and Association Executives (PCAAE) and the Asia-Pacific Federation of Association Organizations. The program consisted of a balanced mix of presentations and panel discussions on a wide range of topics from association governance and management to impacts of associations and their activities in national development. I wish to share the following eight takeaways I got from the conference: n Associations make the world smarter, safer and better. They provide, among others, continuing education, create industry standards and guidelines, and serve underserved sectors of society. “Everything we touch and do is influenced by an association,” American Society of

Association World Octavio Peralta Association Executives Foundation president Susan Robertson said. n Associations must support members’ needs in a changing world. Susan gave the following recommendations: (a) practice anticipatory intelligence, i.e., stay ahead of members; (b) do experience mapping, e.g., “What’s your members’ journey?” To be a better association, “meet members where they are” at their lives and in their careers; (c) provide “micro-learning,” i.e., little bits of readily available knowledge that fits in members’ schedules; and (d) build networks and coalitions for soft skills development, such as leadership and mentoring. n Associations need to move from a membership community to one with a broader ecosystem that includes, among others, the government, academia and other stakeholders, said Dr. Noah Raford, futurist in

fundamentals remain strong. Solid fundamentals backed by TRAIN [Tax Reform for Acceleration and Inclusion Act] 1 implementation, ricesector reform and the “Build, Build, Build” policy will push the country’s growth to 7 percent to 8 percent this year and sustain manageable inflation,” the DOF said. As from nonfood items, the DOF expects the price of nonfood commodities to improve to 2.8 percent, from 3.3 percent in November 2017. Nonfood prices in December 2016, however, proved significantly lower, averaging only 1.8 percent during the period. Broken down, the price of clothing and footwear were seen

chief of the Dubai Future Foundation. “The old world is dying and the new world is here,” he concluded. n Associations as lobby groups are passé and that a “single window strategy” doesn’t work anymore, said Dr. Samir Hamrouni, CEO of the World Free Zones Organization. He added that “collaborating and working with others is the best approach for associations to prosper.” n Associations are changing from all about information to engagement, from programs to people, and from content to community, based on the presentation of Greg Bogue, vice president for Experience Design at Maritz Global Events USA. This means associations should be focused on people development and relationship building going forward. n Associations need to be mindful of their post-event legacy. Association events have economic, social and reputational impacts to the country, said Marjan Faraidooni, senior vice president, Legacy Impact and Development, Expo 2020 Dubai. As such, their legacy must go beyond the physical aspects to more sustainable business activities. n Associations are only as good as

to at 1.9 percent, an expansion from only 1.8 percent ported the previous month. The housing, utilities and fuels component of prices was seen lower to 3.7 percent versus the 4.2 percent recorded last November. Furnishings and household equipment was seen at 1.9 percent, from 1.8 percent recorded in the previous month. The price of electricity, gas and other fuels may have averaged 8.1 percent during the month, or an improvement from 9.7 percent recorded last November. Such other commodities like health may have posted a slight uptick to 2.3 percent, from 2.2 percent in the previous month.

their passionate members. This was according to Martin Sirk, CEO of the International Congress and Convention Association in the Netherlands. In the context of legacy of association events, he added that there is a need to go “beyond tourism” and build on the intellectual and the economics of people involved in events. n The formation of “associations of associations” is gaining ground in emerging economies, such as in Asia and Africa. Jeffers Miruka, president of the African Society of Association Executives, and I, shared our experiences in building our organizations as platforms for wider knowledge exchange and networking opportunities. The column contributor, Octavio Peralta, is concurrently the secretarygeneral 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). PCAAE enjoys the support of ADFIAP, the Tourism Promotions Board and the Philippine International Convention Center. E-mail: obp@adfiap.org

The Regions BusinessMirror

www.businessmirror.com.ph

Editor: Efleda P. Campos • Thursday, January 4, 2018

Group appeals for govt support for fishermen affected by Vinta

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By Jonathan Mayuga @jonlmayuga

HE Pambansang Lakas ng Kilusang Mamamalakaya ng Pilipinas (Pamalakaya) on Wednesday appealed for relief and support for fishing communities affected by Typhoon Vinta.

In pa r t ic u l a r, Pa ma l a k aya said families of fishermen from Palawan who were killed or remain missing urgently need the government’s presence. Citing various reports, Pamalakaya said at least 34 people were confirmed dead, while more than 60 others remain missing. Most

search-and-rescue operations. “We call on the authorities to hasten the search and rescue operations for the missing fishermen and other victims of Vinta in Palawan and, as much as possible, returned to their respective families safe. It is unfortunate the fishermen are still forced to go offshore despite the turbulent weather conditions because they don’t have an alternative source of income in times of natural

calamities,” said Fernando Hicap, chairman of Pamalakaya. The group said the national and local governments must mobilize its rehabilitation funds to provide assistance to the families of the missing fishermen and to the entire fishing community in Mangsee Island devastated by the typhoon. “The government must also speed up its efforts to rehabi litate t he t y phoon v ictims

in a for m of economic relief and livelihood support to help the fishing families get back to their wheels of production,” Hicap said. Pamalakaya urged the Bureau of Fisheries and Aquatic Resources to check on the ground the exact number of the typhoon’s casualties and strictly coordinate with the appropriate government agencies concerned in rehabilitation.

of the victims were fishers who went to fish off Mangsee island in Palawan when Vinta struck the province last week. The group has high hopes the missing fishermen may still be waiting to be rescued by authorities, hence, it urged the Philippine Coast Guard to continue its

2.1 million tourists visited Boracay in Aklan last year By Jun N. Aguirre Correspondent

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ORACAY ISLAND, Malay, Aklan—This resort island has registered an overwhelming 2.1 million tourists for 2017, the highest number so far recorded. Felix de los Santos, municipal tourism officer of Malay town, said Boracay recorded 2,001,974 visitors last year. “We had recorded an increase of 16 percent compared to the 2016 figure,” de los Santos said. The top 10 groups of tourist

arrivals came from China with 375,284; followed by South Korea, 356,644; Taiwan of China, 40,802; the United States, 22,648; and Malaysia, 20,585. Fol low i ng were t he Un it ed Kingdom with 17,416; Saudi A rabia, 15,94 4; Australia, 15, 365; Ru ssi a , 14,074; a nd Singapore, 9,897. The rest of the visitors were domestic tourists and overseas Filipino workers. The records also showed April had the highest number of tourist ar r iva ls, fol lowed by t he month of May.

9 foreign seafarers rescued in N. Samar By Elmer Recuerdo Correspondent

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AMBUJAN, Northern Samar—Nine foreig n seafarers were rescued in the coastal waters of this town when their ship bound for Chile experienced a ruptured hull and drifted toward this town. The Philippine Coast Guard (PCG) station in Northern Samar received a distress call from the cargo vessel Jin Ming 16, a Chinese vessel, and organized a rescue mission in the coastal waters of Pambujan past noon on January 2. The cargo vessel was manned by nine foreign nationals—a Taiwanese, six Chinese and two Hong kong Nationals—identified as Lai Yikui, Hans Febie, X i lon g Su n , X uWe i lon g , S a i Cheong Ho, Wu Ning Jin, Chin Hsin Chuan, Xu Xi and Ye Gui Jin. Febie, a crew of t he ship, told local authorities their ship left China last December 12, to pick up some goods from Chile. On their way, they were met by enormous waves due to a number of low-pressure occurrences in the Pacific that turned into typhoons. He said the waves caused a

rupture on the ship’s hull, and caused the ship to suck in salt water. This resulted to flooding of its compartment, causing the engine to conk out. The ship was drifting toward the municipal waters of Pambujan when the PCG received a distress call from them. I m med i ate ly, a composite team of Pambujan Municipal Police Station, Northern Samar Provincial Mobile Force Company, Coast Guard Allen, Philippine Army, Municipal Disaster Risk Reduction and Management Office, Pambujan and Red Cross Northern Samar was formed to respond to the distress call and conduct a rescue operation. After the rescue, the seafarers were brought to the Pambujan Rural Health Unit for physical examination. Later, they were housed at the residence of the Pa mbuja n mayor where t hey spent the night. Bernie Madrid of the Northern Samar Station PCG said half of the ship was already submerged in seawater and was tilting on the starboard when they arrived. He said only the upper half, or second deck, remained afloat, but was slowly sinking as it kept on drawing more water. With Rene Acosta

VEGETABLES APLENTY Highland and lowland vegetables abound in the Baguio City public market, with prices remaining stable. MAU VICTA

DBM: Congress okay of 100% base-pay hike of military, uniformed personnel awaits Presidential signature By Manuel T. Cayon

@awimailbox Mindanao Bureau Chief

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AVAO CITY—The Department of Budget and Management (DBM) said the Congressional approval of a 100-percent pay hike for the military, police and other uniformed personnel was awaiting the signature of President Duterte before it would finally take effect. The Congressional approval came as the DBM also announced the continued pace in infrastructure spending this year. The DBM said the joint Congress resolution agreed in mid-December to increase the base pay of Military and Uniformed Personnel (MUP). “The proposed joint resolution will double the base pay of a Police Officer [PO] I in the Philippine National Police or a Private in the Armed Forces of the Philippines and equivalent ranks in the Bureau of Jail Management and Penology, Bureau of Fire Protection, Philippine Public Safety College, Philippine Coast Guard, and the National Mapping and Resource Information Authority,” the DBM

statement last week said. It said a PO1 and those with equivalent rank would enjoy a-100 percent increase “resulting to a monthly base pay of P29,668.” “Overall, the salary adjustments would result to a 58.7- percent average increase for all MUP ranks, effective January 1 this year,” it said. The House Joint Resolution 18 and Senate Joint Resolution 11 “both allow for a second tranche of base-pay increase for the ranks of senior PO4 up to director general and equivalent ranks to be implemented beginning January 1, 2019. By fiscal year 2019, the average increase will be 72.18 percent for all ranks” It said the increase in base pay would also mean a consequent increases in other allowances and bonuses “that are computed as a percentage of base pay, such as longevity pay [or foggy pay], mid-year bonus and year-end bonus. “It would also effectively discontinue the grant of provisional and officers’ allowances, an interim measure pending the modification of the base-pay schedule,” it said.

The DBM said the net takehome pay would be much higher than the previous arrangement “since the longevity pay is taxexempt, while the interim allowances [provisional and officers’ allowances] are subject to income tax. Tax-exempt collateral allowances [e.g., flying pay, sea duty pay, instructor’s duty pay, etc.] are expected to increase, as well.” The DBM also said the uniformed personnel would also expect higher take-home pay with the implementation of the new tax law and the lowering of income-tax rates. It said the government would fund the base-pay increase from the Miscellaneous Personnel Benefits Fund, “and from any available allotment in the respective budgets of the agencies concerned.” The increase would mean an additional cost of P64.2 billion for 2018. “The resolution will have the force and effect of a law upon the approval of the President. Such an approval is imminent as the Office of the President had earlier officially endorsed the resolution as urgent,” it said.

Tagum City vows strict enforcement of vehicle speed limit

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AVAO CITY—The increasingly urbanized Tag um City, the capital of Davao del Norte, vowed to enforce the speed limit to copy the strict implementation of its neighbor Davao City. The City Mayor’s Office announced it was ready “to discipline over-speeding drivers and minimize road accidents” after it bought five new “speed guns,” a handy speed-monitoring gadget.

The enforcement would cover all drivers and motorists going in and out of the city. The City Information Office said in its Tuesday dispatch it would base the speed limit from Republic Act 4136, the Land Transportation and Traffic Code, “which stipulates the transportation’s restriction as to speed.” “For passenger cars and motorcycles, a maximum speed of 80

kilometers per hour [kph] is set as the limit, while motor trucks and buses are limited to drive a maximum speed of 50 kph,” the information office said. It added that “such allowable speeds are to be observed along the highway from Tagum-Carmen Boundary going to Crossing Tagum, as well as Magdum Sub Station going to Tagum-Mawab boundary.” Manuel T. Cayon

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Agaton forces 2,131 families in Palawan to evacuate

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UERTO PRINCESA CITY, Palawan­—About 2,131 families, or 8,016 individuals, were preemptively evacuated from their homes in 10 coastal villages in this city and 11 municipalities in Palawan as Tropical Depression Agaton traversed the province’s central portion. Here in Puerto Princesa, an estimated 607 families (3,035 individuals) dwelling in 10 coastal villages prone to strong winds and storm surges were evacuated on Tuesday evening, Richard Ligad, City Information Office (CIO) chief and designated spokesman of the City Disaster Risk Reduction and Management Council (CDRRMC), said on Wednesday morning. “As of now, they're all good. Mayor [Lucilo] Bayron directed the City Health Office to make rounds in evacuation centers and check the health condition of our evacuees,” he said. Ligad said the City Social Welfare and Development Office has already distributed food packs to 533 families. “Up until now, food-pack distribution is ongoing,” he said. “We’re glad most of them preemptively, voluntarily evacuated and no casualty has been reported, so far.” In Jacana, Barangay BancaoBancao in this city, the Philippine News Agency caught up with the family of 14-year-old Rodrigo Makaraya, whose home was seriously damaged by Agaton’s burly winds that coincided with high tide. “All the homes of our neighbors were destroyed. Even our home was not spared. That is why last night, we evacuated to the school. The tide from the sea was ver y high, almost as tall as the houses. It was scary,” Makaraya said in the dialect. In the barangay where he lives close to the water, more than 10 homes were totally destroyed, including the footbridge residents use to cross to reach their homes. Makaraya’s neighbor, housewife Marilyn Iyao, was emptying her shanty of seawater and wood debris that managed to get in. “All our things were wet because of the waves. It was so high, that is why we immediately rushed to the school last night. The wind and the high tide came together,” Iyao said in Filipino. In the province, reports claimed 1,524 families (roughly 4,981 individuals) were evacuated in 11 municipalities. Many of them spent Tuesday night in evacuation centers and some, with host families, as sturdy winds battered their homes along the coast. The evacuees were from Sofronio Española, Bataraza and Quezon in southern Palawan and Magsaysay, Araceli, Taytay, Roxas, Dumaran, Culion, Cuyo and Busuanga. “We are thankful that unlike in other provinces, our residents here easily listen when you tell them to evacuate for their safety. They themselves went to the evacuation centers,” information officer and Provincial DRRMC Spokesman Gil Acosta Jr. said on Wednesday morning. He added some of the people have left the evacuation centers to return to their homes early Wednesday, bringing with them the food packs distributed by their municipal DRRMCs. Meanwhi le, t he deat h tol l from Tropical Storm Vinta had increased to 37, while 60 individuals remain missing, Acosta said. Search and retrieval operations continue in the vicinity of Mangsee Island to as far as Mapun, Tawi-Tawi and the neighboring shores of Malaysia. With reports

from Keith Anthony Fabro/PNA

A10 Thursday, January 4, 2018 • Editor: Angel R. Calso

Opinion

BusinessMirror

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Eliminating poverty

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ne of the biggest challenges we face today is the growing chasm between the rich and the poor. For example, in 2017 the combined wealth of the 50 richest Filipinos was estimated at $74 billion. That’s about a quarter of the country’s 2016 GDP of $305 billion. On the other hand, four out of 10 Filipinos consider themselves poor. The concentration of the country’s wealth in the hands of few individuals amid millions of poor Filipinos could be seen as economic injustice. We can blame the policies that do not address the root cause of poverty in perpetuating such inequality. For example, farmers and fishermen remain poor because the government continues to neglect them. This should not be the case because the Philippines was one among the United Nations member-states that signed a new set of global development goals that sought to eliminate extreme poverty and hunger everywhere. In his BusinessMirror column on Wednesday, Sen. Edgardo J. Angara wrote that rich Filipinos have been giving charitable grants and donations mainly through their corporate foundations. He added: “Regrettably, the Filipinos’ famed generosity has been waning in recent years. In the 2017 World Giving Index, the Philippines ranked 54th out of 139, falling from 16th out of 135 in 2013. While the Filipinos were the world’s 14th-most active volunteers (seventh in terms of their numbers), they weren’t as willing to donate money (95th) or to help a stranger (66th).” Angara said the amount dedicated to philanthropy is vital because it’s a measure of one’s character and civics. Equally vital, he added, is where the charitable spending went, and to what purpose. Today, many among the Filipino rich pursue scholarship programs, school buildings, or one-off grants on the occasion of a calamity or the anniversary of the donor. All of these are welcome, but they are palliative in nature. Angara said achieving true equality and genuine fairness in Philippine society offers multiple paths: more robust investments in basic education and modern skills training, improving child health and nutrition, or constructing livable shelters. “Charitable giving could even be directed to research and development for improved food production or to oceanography for protecting our seas. Both areas would benefit many farmers and fisherfolk, among our poorest sectors,” he added. Angara suggested that research grants can be awarded to the Research Institute for Tropical Medicine, the Philippine Rice Research Institute, or to several state universities specializing in fruits and vegetable production. Why? Because such endowments may spark a nutrition revolution where Filipinos become taller and healthier—and eventually, more productive and ambitious. His advice: “Filipino philanthropists should rethink, revise and reconfigure their gift-giving. They should adopt a systemic form of philanthropy that will be a strategic intervention to making a more equitable and inclusive country.” The sad reality is that millions of poor Filipino children have grim chances of breaking out of the chain of poverty. If the meager amount their families have is spent on food, there’s nothing left for education and other needs. There’s a general consent that lack of formal education holds these poor kids back. That’s why it’s difficult for the poor to retain their self-respect or hope for a better future. When they feel destitute, they turn to drugs or petty crime. We have to recognize the inevitable impact of abject poverty on crime and susceptibility to recruitment for criminal or, worse, terrorist acts. The rich can share their wealth to give the poor a chance to improve their lives. The government, however, has the sole responsibility to come up with economic policies to end gross inequality, unfairness and exclusion in Philippine society.

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2018 trading thoughts John Mangun

OUTSIDE THE BOX

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ree advice is worth exactly what you pay for it, just like everything else that doesn’t have a sticker price. It’s not that what we get for free is not valuable; it’s just that we treat it as if it were worthless. Few people listen well to free advice.

Being of an uncomplicated mindset, I tend to view the world simplistically. We will soon enter the Year of the Dog. Your own family dog is cheerful, friendly and loyal. A stranger’s dog is vicious, mean and sometimes deadly. The same is usually true of stock positions. While the family pet is usually held in higher regard and loved more than your brother-in-law—for obvious reasons—it is still just an animal in comparison. The fable of this story is, while you have already learned not to “marry your stocks,” they should not be adopted either. Dogs usually do not

start with eating the sofa. Likewise, losing stock positions do not usually start with a “limit down” move. The Philippine Stock Exchange started 2018 with a boom, probably making up for all the fireworks that were not shot off over the holiday. That is great. But several “small” losing days or weeks can turn into a nightmare like every time you leave your shoes unguarded, the next morning, the dog ate them. With the local stock market in uncharted waters, you never know when the sea monsters are going to appear. The minimum performance expectation for last year should be a

25-percent increase in your stockmarket portfolio since that is what the blue chip index turned in. Most investors probably beat that benchmark. But greed being good, too many investors are seriously disappointed that they were not on board the high flyers that went up 100 percent and more. During and after a large long-term increase in stock prices, people start looking for “profit love” in places they probably should not go. The first thought is that, those issues that went higher before—either reasonably or exuberantly—are not the best choices. Wrong. Assuming no player changes, the team that won last year’s championship is the favorite going into the new season. But there is a caveat emptor. Megaworld was up 45 percent in 2017. Will this issue do the same in 2018 and go 20 percent above its previous historic high? Maybe. But the stock market started January 2017 down 15 plus percent from its 2016 high, so it was moving higher in 2017 off a low base. Nevertheless, I think that 2018 is going to be a big profit-making

Donald Trump goes to the movies

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By Frank Bruni | New York Times News Service

E don’t talk a whole lot about class in America, where we prefer to pretend that we transcend such distinctions. But in 2017 American movies had that conversation, bluntly and hauntingly, and if you spent the holiday season catching up on the year-end crop of Oscar-minded fare, you visited unpolished places. You met unsatisfied people.

They spoke of being trapped on the wrong side of the tracks (Lady Bird) or in the wrong sorts of clothes (I, Tonya). They tried to paint over their despair, as if a thick-enough coat of a bright-enough pastel could keep the disappointment at bay (The Florida Project). They went to creative, even absurd lengths so that their voices might be heard (Three Billboards Outside Ebbing, Missouri) or that they could know the economic security that seemed forever beyond their reach (Downsizing). I can’t think of a previous batch of statuette-season contenders so politically on point and of the moment, and I credit—although that’s not quite the right word—Donald J. Trump. His rise and presidency have brought so many of the cancers of American life to the surface, where we can no longer avoid them, and the movies reflect that. He’ll be at the Golden Globes and the Academy Awards not just as the butt of a gazillion jokes. He’ll be there as an inspiration.

Yes, some of the movies being celebrated now were first dreamed up or set in motion even before he announced his candidacy in June 2015. But they were propelled by some of the same discontents that he seized on and divisions that he exacerbated. The themes of the Trump era are the themes of these movies. For racial anxiety, enter the nightmare of Get Out, which was released early last year but has roared back onto the radar for best-of-2017 lists. For the tense relationship between the federal government and the media, see The Post. All the Money in the World presents a self-infatuated plutocrat whose obsession with riches deadens his soul. His surname is Getty, but he may remind you of someone else. Put these movies together and you have a cinematic syllabus for a course on America right now. All the messes and the monsters are accounted for. And Hollywood, thank heavens, is poised to honor something other

than the agonies and ecstasies of its own creative process, as it has done so many vanity-stroking times before (The Artist, Argo, Birdman, La La Land). It’s looking outward, precisely when that’s most important. Part of what it’s seeing is the special burden that women bear and the particular powerlessness that they feel. That’s front and center in The Florida Project, whose down-and-out mothers rear children without help from fathers and survive economically by sexually subjugating themselves. In Three Billboards, Frances McDormand’s character, demanding justice for her murdered daughter, won’t let the police officers, the Catholic priest and other patriarchs in her small town shut her up and shoo her away. In The Post, Meryl Streep’s Katharine Graham muscles through a scrum of insistent and often patronizing men to claim her role as the decider. It’s a tale of awakening—and a fitting punctuation mark for a year in which so many women broke their silence. Lady Bird, too, explores gender, but what impresses me even more is its observant take on class. For the record, it’s not about Lady Bird Johnson, the former first lady, but about a high school senior in Sacramento whose adoption of that fanciful nickname is part of how she chafes against her station in the world. She misleads a fellow student

year across all sectors, whether in business or investing. Of course, this is in anticipation of the economic chaos, which will begin in 2019. Bright sun before the storm, so to speak. It is just like all the traditional political parties around the world that thought they had it in the bag for the 2016 elections as we entered political chaos. Think the Democratic Party in the United States and the Liberal Party in the Philippines. The final free advice I have is to be cautious of looking for issues that were the laggards in 2017. I am not talking about those companies that started coming to life in the last half of the year. They may be price laggards but not trend laggards. Issues that start 2018 at lows will either continue to fall behind or—much worse—will start going higher just when the broad market runs out of steam. Losers tend to remain losers. Don’t be one of them. E-mail me at mangun@gmail.com. Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stockmarket information and technical analysis tools provided by the COL Financial Group Inc.

from a more privileged background about the splendor and address of her own home. She yearns to attend the kind of private college in the Northeast that she supposedly can’t get into or afford. At every turn, she’s told about her limits. She just refuses to listen, less because she’s gifted with boldness than because she’s graced with youth. I happened to see I, Tonya right after Lady Bird and was struck by their shared preoccupation with the self-consciousness, even shame, that Americans who struggle financially are sometimes made to feel. I, Tonya frames the famous misdeeds of the Olympic figure skater Tonya Harding as an understandable rebellion against the cruel snobbery that she confronted. If she broke the rules, well, they were rigged against her, or so implies the movie, which has more on its mind than triple axels. Lady Bird was written and directed by a 34-year-old woman (Greta Gerwig) and Get Out by a 38-year-old black man (Jordan Peele). Like Moonlight, which rightly upset La La Land to win the best-picture Oscar last time around, they’re what happens when the pipeline isn’t so conventional and opportunity so cinched. Diversify the storytellers and you diversify the stories. They’re truer to America, which certainly needs the truth.

Opinion

BusinessMirror

www.businessmirror.com.ph

Thursday, January 4, 2018 A11

Markets benefited from what The new power in the world didn’t happen in 2017

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Msgr. Sabino A. Vengco Jr.

By Mohamed A. El-Erian | Bloomberg View

any of the assessments of the 2017 financial markets understandably focused on the impressively favorable outcomes delivered by stocks and other risk assets. Yet it is also worth considering what didn’t happen—in particular, nine events, which, by not taking place, contributed to make the last 12 months exceptional for many investors, big and small. Superlatives have been and should be used to describe stock-market performance in 2017. Rewarding overall returns, including gains of 25 percent for the Dow Jones Industrial Average and 19 percent for the S&P 500, came wrapped in extremely low volatility. The VIX, the most widely followed measure of market volatility, registered nine of its 10 lowest levels last year. The series of record highs during the year—71 for the Dow alone —was accompanied by very few episodes of market retracement. And the rare times these occurred, they were comfortably limited in size, duration and scope. Overall, the Dow rose nine months in a row, the longest streak since 1959; the S&P delivered positive returns every month of the year. The powerful performance of stocks was not limited to the United States. A few international markets did better, including an almost 40-percent return on Hong Kong stocks, and the MSCI ACWI (excluding the US) index returned a solid 24 percent. Adding to the good news for investors, the cost of risk mitigation associated with the traditional 60/40 stock/ bond investment portfolio was de minimus, and even nonexistent with a diversified fixed-income approach. In another unusual twist, both stocks and bonds delivered positive returns. The yield on the 10-year US government bonds ended the year at 2.41 percent, or four basis points lower than at the start of the year. Given the surge in global stocks, that is certainly not the performance that would be expected for the “risk-free asset” based on history. Moreover, the US government bond market traded in a relatively narrow range all year, with the 10-year spending around 80 percent of the time in a band of just 30 basis points. Yes, there is a long and impressive list of things that went extremely well for investors in 2017, as markets responded favorably to the trifecta of: 1. A synchronized pickup in global growth, turbocharged in the US by progress on pro-growth measures; 2. Strong corporate profitability; and 3. Ample liquidity, particularly on account of central bank policies and the redeployment of corporate cash back into the market via higher dividends and buybacks. Yet, as long and consequential as the list of 2017 superlatives is, it is also worth looking at what didn’t happen —especially if the goal is to look ahead to 2018. In this regard, nine issues are worth mentioning: n Lack of a Fed policy mistake. Confounding critics again, the Federal Reserve (the Fed) took important steps in normalizing monetary policy without disrupting markets and/or derailing economic growth. These actions included several interest-rate hikes and laying out a timetable for reducing the balance sheet. And, while the Fed was helped to some extent by the extremely loose nonconventional measures that continue to be implemented by other central banks, particularly the Bank of Japan and the European Central Bank, credit is due to US policy-makers’ careful planning and measured policy response, including in skillfully nudging markets on at least two major occasions to price more realistically its short-term interest-rate intentions. n No durable disruptions to trade. Belying the fears of some, the Trump administration did not disengage from the North American Free Trade Agreement, declare China a currency manipulator, or cancel free-trade pacts with countries, such as South Korea. It did exit the Trans-Pacific Partnership negotiations, but this agreement was still a work in progress and had not had any notable impact on trade. Instead of disengaging from existing trade agreements, the US nudged its partners to pursue fairer international trade practices, reinforcing rather than undermining the pro-growth

policies it pursued elsewhere. n No spike in inflation. Despite the sharp decline in the unemployment rate and a year of impressive net job creation, neither wage growth nor the inflation rate took a meaningful leg up. This lack of price pressure perplexed many economists, went against what history would predict, powered a market response with the notion of “Goldilocks” growth and contained market concerns about excessive Fed policy tightening. n No selloff in US government bonds. The lack of inflationary pressure was one of the factors helping to explain a government bond market that defied expectations again. The persistence of low and stable yields reinforced the general market risk-taking appetite, underpinned by the notion that, with the Bank of Japan and the ECB remaining ultra-dovish, the central banking community would remain the investors’ BFF. n No dollar appreciation. After the notable appreciation into the start of 2017 and the resulting cautionary statements by President Donald J. Trump about excessive currency strength, the dollar remained relatively weak for most of the year even though the Fed raised rates, the US adopted pro-growth measures, the economic expansion broadened and the tax bill encourages the repatriation of corporate profits held abroad. In addition to lowering trade tensions, this removed a headwind to US growth and reinforced the feel-good factor concerning corporate profits. n No Bitcoin regulatory crackdown. Despite some worrying that the historic surge in Bitcoin prices was a bubble that would end up bursting and hurt most small investors, there was very little regulatory backlash against a phenomenon that some also believe is empowering illegal activities. This reinforced a more general view that the regulatory pendulum has now swung solidly, heralding a period of general deregulation. n No contagion from Puerto Rico or Venezuela. Although both Puerto Rico and Venezuela missed contractual payments on their bonds, neither event created contagion in the municipal and emerging-market segments, let alone more broadly. Investors treated both events as isolated and as constituting no threat of adverse spillover. n No geopolitical shock for markets. North Korea continued its brazen threats of nuclear attack throughout most of 2017, including on New Year’s Eve. Yet, markets continued to ignore the risk almost all year, betting—correctly—that provocative words would remain just that and not translate into actions that would disrupt markets during the year. n No Opec disintegration. Despite the pressure earlier in the year of low oil prices, Qatar-related tensions within the Gulf Cooperation Council, and various Iran-Saudi proxy wars, the operational discipline of the Organization of the Petroleum Exporting Countries (Opec) cartel was not eroded. If anything, it strengthened during the year. That, together with effective cooperation with Russia and other non-Opec producers, allowed oil prices to withstand competitive pressures from shale and end the year at levels not seen since December 2014. This gave an important boost to energy stocks, reversing their large underperformance during the first half of 2017. The failure of these nine threats to materialize contributed to 2017’s strong annual performance for risk assets. Together, they turbocharged a rally powered by improving economic prospects, strong corporate profitability and ample liquidity. After closing the books on a great year, investors now need to assess the durability of this unusual combination of things that did and did not happen. Happy New Year and best wishes for a happy, healthy and successful 2018.

Alálaong Bagá

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T is with the solemn feast of the Epiphany, more popularly known under the misnomer of feast of the Three Kings, where we commemorate the visit of the Magi to Jesus as a glorious manifestation of God to all the peoples of the world (Matthew 2:1-12). This manifestation (epiphania or pagpapakita) of the Savior was already a most important feast in the East, long before Christians in the West introduced the celebration of Christmas.

The face-off Two kings are in a face-off in this story by Matthew. On the one hand is Herod, King of the Jews and called the Great, a vassal of the Roman Emperor since 40 BCE, a survivor-type in the intrigue-rich world of despots, a builder of grandiose constructions focused on fortification, whose hold to power was his principal concern. This explains why he was “greatly troubled and all Jerusalem with him” at the news about the new-born “King of the Jews.” Like so many earthly potentates, the elimination of his perceived rival was paramount. He deceived those looking for the baby

king, projecting interest and plans to revere the newcomer, to get his hands at the “baby danger.” He even consulted religious experts to plan better his nefarious design. Eventually, in a panic, he would resort to the murder of the innocents for his futile self-preservation. The newborn child of Mary, on the other hand, the alleged King of the Jews, is lying on a manger, born in the poverty of his plebeian parents, posing no physical danger to the throne of any king. Yet, this child was feared precisely because his type of kingship is not based on any human patronage or machination

but altogether on another plane that challenges and radicalizes the core of every human being. He does not maintain Himself in power by means of a ruthless police force or a program of powerdisplays with which to cow the people into submission or to beguile them into willing surrender. He presented himself to the world lying on a manger, meaning He is the life and nourishment for God’s precious flock because He is willing to love to the extent of self-oblation. It is not death but the gospel of love and life that He offers humankind.

The wise men

There were wise men (magi) from far corners of the earth that came looking for the infant king. Their search and hunger for the one signified by the star was so overpowering, they braved the unknown and left the security of their homes. There lies their wisdom. What does anything else matter, if life is without any transcending meaning? And what one is not ready to risk everything for is not really it. To have looked for it and found it was their life’s accomplishment of ultimate and eternal value. They were successful in offering their gifts to the newborn Savior of the world.

Achieving SDG targets in wicked times Dr. Rene E. Ofreneo

LABOREM EXERCENS Continued from A1

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nd yet, against the above global reality as summarized by the Guterres, the UN Development Program (UNDP) is trying its darnedest best to promote the UN vision of a new global order by 2030. In 2015 the UN member-states, the Philippines included, signed on to a new set of global development goals to replace the old “Millenium Development Goals” (MDGs), which sought to eliminate extreme poverty and hunger everywhere. Under the MDGs, the Philippines committed to halve poverty, percentage-wise, from the 1990s’ level by 2015. This was not achieved.

The new global goals—Sustainable Development Goals (SDGs)—are more ambitious. Zero poverty and zero hunger by 2030 everywhere. Healthy life for all at all ages. Education and learning opportunities for all. Gender equality and empowerment of all women and girls. Safe and affordable water for all. Access to affordable and sustainable energy services for all. Sustainable economic growth and decent work for all. Inclusive and sustainable infras and industrialization for all. Social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion and other status. Inclusive, safe and resilient cities and human settlements in all countries. Sustainable consumption and production in all countries. Strong global action against climate change, accompanied by full integration of climate-change measures into national policies. Sustainable use and conservation of the seas and marine resources. Sustainable use and

conservation of the terrestrial ecosystem, forests and land. Access to justice for all and promotion of inclusive, peaceful and sustainable societies and institutions for all. Global partnership for sustainable development. Verily, the SDGs, if fulfilled, are not only transformative. They shall change governance and development directions in all countries, both developed and underdeveloped, in a radical, if not revolutionary way. The 17 SDGs, fleshed out into 169 specific or more concrete targets, put people at the center of development and make the sustainability and inclusion framework—for the economy, environment and society—the overarching development compass in governance at the national and global levels. The mantra of the advocates of corporate social responsibility—the three Ps (people, planet and profits)—has been transformed by the SDG proponents into 5Ps: people, planet, prosperity (for all), peace and partnership. The problem is, how can the world

achieve the 17 SDGs? Clearly, there is a need for humanity and the leaders of the different countries to seriously address first the threats to the world as raised in the “red alert” of Guterres. The threat of a nuclear war, the global failure to forge consensus on how to address global warming, the deepening inequality everywhere and the rising xenophobia and racism among some political groups are dividing the world and subverting the sustainability of the economy, environment and even some societies. And, as pointed out in an earlier article, the SDGs cannot slay poverty and hunger if the Race to the Bottom under economic globalization is untamed. The Race to the Bottom among big corporations and transnational firms competing in a borderless global economy is at the roots of exclusion for the many and the deepening inequality within and among countries. Nonetheless, it is the obligation of all UN member-states, which signed on to the SDG Compact in 2015, to do their darndest best to work for the attainment of the SDG goals and targets at the national and global levels. In this context, it will do well for the Duterte Cabinet to review the country’s development goals and targets for 2017 to 2022 and those outlined in Neda’s Ambisyon 2040 in the context of the SDG framework. One difficulty in a policy review related to the SDGs is that the SDG list and the accompanying specific doable targets appear too long. The tendency of a policy reviewer is to treat all the SDGs and targets as some kind of a “checklist.” Under each item, the government-assigned reviewer can list down what the government or various agencies are doing to address a specific concern. For example, in the eradication of extreme poverty under SDG 1, the official reviewer can put the Conditional Cash Transfer (CCT)

The wise men came upon the like of Herod, but they did not give up what they believed in. They maintained their innocence, even naively asking for assistance from the very persons upset by their quest. They persevered in their intention and were not let down. The star was there still and again, because the guiding star is actually never away for those who search for truth in the marvels of creation and in the wisdom of human cultures. They continued to be attentive and obedient, knowing they would remain in need of guidance. They did not return to the foxy Herod; they had enough of him. A wise move. Alálaong bagá, in life we are challenged to search for the life and happiness that truly lasts. Our Christian faith and wisdom tells us that the Son of God has been born one like us to manifest and share with us the life-giving love of God. Amid our human darkness, there is now light guiding all peoples to be wise. We offer our adoration only to the Child on the manger, whose love is the real life and power in the world. 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.

as the government answer and reduce the problem of poverty eradication to a simple question of increasing the budget for CCT and growing the economy faster through programs, such as the “Build, Build, Build” of the Duterte administration. Yes, it is unavoidable to look into each SDG and accompanying targets in this manner. However, the UNDP has also warned us that there is also a need to look at the 17 SDGs as interrelated and even “indivisible.” The point is that all the 17 SDGs are anchored on the sustainability and inclusion challenges, that is, how to make the economy inclusive and sustainable for all, how to make the environment inclusive and sustainable for all and how to make society inclusive and sustainable for all. This requires a more rigorous analysis of the development strategy being pursued by the government at the national, regional and sectoral levels by subjecting them to the test of inclusion and sustainability. For example, is the vision of a developed middle-class Philippine society outlined under Ambisyon 2040 sustainable? Ambisyon tells us that, by 2040, all families shall enjoy the good life—jobs for all, decent dwellings for all, education for all and family vehicles for all. Now, on the last item, given the horrendous traffic that we experience daily, not only in Metro Manila but in almost all urban areas of the country, as well, is having a car for all families a wise target? Why not come up with alternative development targets, such as better-planned human settlements (SDG 11), better infrastructures and transportation for all (SDG 9) and change in consumption and production in support of decent but sustainable lifestyles for all (SDG 12)? Let the debate begin.

PNP’s prescribed procedure for organized and systematic news gathering MAIL

I read with displeasure what could have been an otherwise interesting special report on the thriving VIP security business in the country (part 1), as reported by BusinessMirror staffer, Mr. Renato Acosta. The report wrongfully accused my

office, the Philippine National Police (PNP) Public Information Office, of not acting on BusinessMirror’s request for an interview. To set the record straight, the PIO Staff attended to the BusinessMirror’s concern even during my absence when Mr. Acosta visited my office in Camp Crame. The PIO Operations Officer herself coordinated with the Supervisory Office for Security and Investigative Agencies (Sosia) to schedule the BusinessMirror an interview and give them leeway to research and prepare the data and records needed by their reporter. It’s just that the PIO does not have complete control over the availability of the resource person of such a bustling frontline office like the Sosia. While awaiting confirmation of the interview, their representative, meanwhile, insisted to

be accommodated right away. The report also unfairly described myself as having imposed a “dictatorial” rule that any request to interview officials of the PNP must come through me. For someone with vast experience in covering the defense and police beats, Mr. Acosta would have known well the rigid communication structure that is observed in these establishments. In the case of the PNP, however, the organizational policy of delegating to the PIO all media-related concerns is not at all any form of imposing restrictions on the media, rather, it is intended purposely to facilitate any and all concerns of bona fide media members by bridging them with the concerned PNP unit or office, especially if the information being sought requires an expert source on the subject. If other media visitors with official

business at the PNP National Headquarters can cooperate with us and go through the prescribed procedure for organized and systematic news gathering, I see no reason your representative cannot do the same, unless he expects to be treated, special. As spokesman of the PNP, it is my duty to provide the media with the most reasonably convenient ways and means of acquiring and processing information. As such, I need to maintain my stature of credibility as a news source, something that was unduly compromised by the BusinessMirror’s unwarranted branding. If there is anyway else that my Office can be of assistance to the BusinessMirror, by all means please let me know. PCSupt. Dionardo B. Carlos Chief, PIO/PNP Spokesman

2nd Front Page BusinessMirror

A12 Thursday, January 4, 2018

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May referendum for Federal Charter eyed

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By Jovee Marie N. dela Cruz

@joveemarie

he leadership of the House of Representatives on Wednesday said Congress is eyeing to submit to the public for referendum the proposed new Federal Charter as early as May. In an interview, Speaker Pantaleon D. Alvarez said if the 17th Congress could convene into a Constituent Assembly (Con-ass) this month, the proposed Federal Charter could be ready for referendum simultaneous with the barangay elections on May 14. Alvarez said this should not be a problem, as Senate President Aquilino L. Pimentel III is an official of the ruling party—the Partido ng Demokratikong Pilipino (PDP)—that advocates federalism. According to the Speaker, convening Congress into a Con-ass to propose Charter amendments and

the shift to federalism is the top priority of the House when session resumes on January 15. “No. 1 is the convening of Congress into a Con-ass and revising the Constitution—a shift from a unitary to a federal form of government,” he said. Alvarez added that he is confident of the support of the super majority for the Con-ass, but admitted he has no idea if there is enough number in the Senate in support of the proposal.

No election

Meanwhile, Alvarez said that,

May 14 The new date for the barangay elections, which could coincide with the referendum for the proposed Federal Charter

if a new Constitution for a federal form of government is accepted by the Filipino people, the timetable of forthcoming elections may be affected, including the 2019 midterm polls. He said the senators are concerned over their political career with the possible dissolution of the Senate in a federal setup, but they should not be worried because they could be eligible to run for election to the new legislature. However, Alvarez acknowledged that there could be some disagreements over the issue of voting jointly or separately in a Con-ass, noting that the 1987 Constitution is silent on this issue.

Personally, Alvarez said he believes the assembly should vote jointly. “Anything is possible...let’s be practical. If we shift into a different form of government, unitary to federal, you need a transition government,” he noted. Under the federal setup the PDP is pushing for, Alvarez said the system would likely retain the position of President, which is elected at large by the Filipino people and would act as head of state. There would be a Prime Minister, who would be the head of the government. During Congress’s last session day of 2017, the House of Representatives began the plenary debates on the convening of the 17th Congress as a Con-ass under House Concurrent Resolution 9. Under Con-ass, it’s the sitting lawmakers themselves—congressmen and senators—who will serve as the delegates.

‘Full steam ahead’

House Committee on Appropriations Chairman Luis Raymund F. Villafuerte Jr. said it’s now “full

steam ahead” in Congress for the process to shift to a federal system of government, now that President Duterte has completed his list of 25 members that will comprise the Constitutional Commission (Concom) tasked to propose amendments to the Constitution. The lawmaker, in a statement, said that, besides completing the Concom’s membership, which includes retired Chief Justice Reynato Puno and former Senate President Aquilino Q. Pimentel Jr., the Legislative-Executive Development Advisory Council also included this proposed shift to federalism on its list of 27 priority bills. “All these positive developments mean that the process to shift to federalism is now in full throttle. As I have been saying all along, federalism will only fulfill its goal of redistributing wealth to the countryside if it is accompanied by moves to liberalize the Constitution’s restrictive economic provisions,” Villafuerte said. Thus, he added, amending the Constitution should also include removing the provisions that limit

foreign ownership in various sectors of the economy. “Federalism and foreign investments will sustain the economy’s growth momentum and enable the government to put flesh into President Duterte’s vision to disperse growth and development to the regions,” Villafuerte said. House Appropriations Committee Chairman Karlo Alexei B. Nograles of Davao City said the 1987 Constitution must first be opened up for amendments to allow the establishment of autonomous federal states. “These are Northern Luzon, Central Luzon, Southern Luzon, NCR/ Metro Manila, Bicol, Mimaropa, Eastern Visayas, Central Visayas, Western Visayas, Northern Mindanao, Southern Mindanao and Bangsamoro,” he said. The House Committee on Constitutional Amendments’s four technical working groups (TWGs) are already drafting a proposed Philippine Federal Constitution. TWG 1 chaired by Rep. Corazon Nuñez-Malanyaon of Negros See “Referendum,” A2

Travel‘bucket list’ for 2018

From Cagayan de Oro, take a short trip to Bukidnon to zip-line in Dahilayan Adventure Park. Image courtesy of CEB Continued from A1

number of hotels, resorts and bedand-breakfasts on the island, as well as charming bistros and cafes serving an array of international and local cuisine. This writer’s personal favorites are the Luna Ristorante for its Napoli-style pizzas, the J&A Fishpen for its seafood, while the chicken surol (curry) and kinilaw na malasugue (fish ceviche) at the Santo Niño Cold Spring resort are some of the best local dishes the island offers. Cebu Pacific (CEB) and Philippine Airlines (PAL) fly either directly to Camiguin from Manila, or via Cebu. Popular accommodations include the posh Bahay Bakasy unan, Camiguin Highland Resort and Kuma Eco Lodge, to name a few. (Check out the Facebook page of the Camiguin Tourism Office for more hotel and resort recommendations.) 6. Cagayan de Oro, Misamis Occidental—Cagayan de Oro (CDO) offers many surprises and interesting activities for the fearless traveler. CEB Director for Communications Charo Logarta Lagamon says: “With numerous daily flights at the Laguindingan International Airport in Misamis Oriental, the gateway to Northern Mindanao, Cagayan de Oro is a must-visit destination for those seeking fun and adventure. The City of Golden Friendship serves as a jump-off point for whitewater

rafting, rapelling, zip lining and many more.” She adds that the Cagayan River, a natural boundary that separates the city from the province of Bukidnon, boasts of Beginner, Advanced and Extreme rapid runs, with the latter requiring a two-hour trek before starting the adventure. She also recommends visitors to “take a two-hour drive up to Bukidnon to experience the Dahilayan Adventure Park, home of Asia’s longest dual zip line at 4,700 feet above sea level and speeds of up to 90 kph.” CDO also has excellent seafood; it is where this writer first tasted imbao (mangrove clam), which can be cooked in soup, halaan style, or just baked with butter and garlic. The city is also famous for the sinuglaw, a ceviche of fresh fish with grilled pork using the tabontabon fruit, which is only found in the region. It is also the place to buy sweet lanzones and rambutan, when in season. Seda Centrio is the place to stay in the Metro, or Red Planet if you’re on a budget. TripAdvisor has a list of its top 10 best hotels in CDO for you to check out: http://bit. ly/2DM5J4J. CEB has daily flights to the Laguindingan Airport from Manila, Cebu, Bacolod, Bohol, Davao, Iloilo and Zamboanga. 7. Dumaguete-Siquijor—Dumaguete, the capital of Negros Oriental, is known as a laid-back

“university town,” as it hosts one of the best educational institutions in Asia, Siliman University. According to Rajah Travel Corp. President Aileen Clemente, the campus itself is an attractive place to visit because of its American colonial architecture; the university was founded in 1901 by Dr. David Sutherland Hibbard, an American Presbyterian missionary. Another fine example of American architecture is the provincial capitol building built in 1924, although technically, the prevailing trend that time in America was Grecian in nature, thus the prevalent use of columns. Dumaguete is rich in Spanish culture as well, adds Clemente, with heritage houses repurposed as commercial establishments; the Saint Catherine Alexandria Cathedral (Dumaguete Cathedral) constructed in 1776 and the iconic Dumaguete belltower in Quezon Park, which once helped warn residents of marauding pirates; and about two hours away by bus, there are ruins of an old Spanish fortress in the municpality of Ayungon. From Dumaguete, tourists can also go dolphin-watching in Bais, check out the bird sanctuary and take a short boat ride to the Manjuyod Sandbar to just sunbathe or swim in the clear, sparkling waters surrounding it. “Dark tourism,” is how Clemente teases the activities one can do in Siquijor, being famous for

Katibawasan Falls in Camiguin Stella Arnaldo

its annual “Witches Festival” held every Black Saturday, in Barangay San Antonio in Siquijor City, What people believe as witches, however, are really herbalists, locally known as albularios, who come from all over the Visayas and Mindanao to recharge their healing powers. They usually gather at Crocodile Hill, overlooking the Bay of Lazi and Mindanao Sea. (In Lazi, a centuries-old balete tree is said to be enchanted. A plus is the fish spa where you can dip your feet and get them cleaned by the little nibblers.) She also points out that “Siquijor is good for soft adventurers because of it’s wide variety of nature spots. Whether you do the coast or the mountain, those looking for a retreat from the hustle and bustle of the city will enjoy what Siquijor has to offer. There are caves to explore (e.g., the popular Cantabon Cave) and the Cambugahay or Luganas Falls to take a dip or swim in.” (Protip: Hire a tricycle driver to bring you around the major tourist spots.) PAL and CEB have daily flights to Dumaguete from Manila and from Cebu. From the Dumaguete port, take a ferry (Montenegro Lines) to Siquijor port. GO Hotel and Hotel

The fish spa at the bottom of the “enchanted” centuries-old balete tree in Lazi, Siquijor Image courtesy Siquijor provincial tourism office

Nicanor are popular places to stay in Dumaguete, while in Siquijor, you can homestay or book their rustic resorts, such as Villa Marmarine or Charisma, which offer beachfront rooms. Check agoda.com for a more detailed list of accommodations on the island. 8. Kalanggaman Island in Palompon, Leyte—Right off the bat, we warn you that this beauty with a white-sand beach can be challenging to reach. But Director Czarina Zara-Loyola of the Department of Tourism says the long trip shouldn’t deter the usual intrepid tourists looking for a new adventure. “Once you arrive on Kalanggaman Island, all you’ll want to do is run to its crisp and clear waters and swim all day,” she enthuses. The waters are also rich in marine life, such that it is a popular spot among scuba-diving tour operators from Malapascua, Cebu. Such is the charm and quiet thrills the island has to offer. Again, fair warning, there are no restaurants on the island, and its sole sari-sari store can only offer visitors water. Zara-Loyola suggests buying food in Palompon’s supermarket before traveling to Kalanggaman: “Stock up on supplies such as food, water, insect re-

pellant and charcoal, if you intend to grill your food at the beach.” There are no resorts of any kind on the island, but she says visitors can stay overnight by renting the native huts and cottages on the beach, or by pitching tents. (Protip: Bring lots of sunblock, as there are few trees that will shield you from the harsh rays of the sun, also reflecting off the waters.) From Manila, one can fly to Tacloban, then take a van to Palompon. From there, there are boats that cross over to Kalanggaman Island. You can also twin your trip to Kalanggaman with Malapascua Island, which has a main beach for swimming, and a myriad of beach resorts where you can stay. Get scuba-diving lessons, then ask your dive shop to take you around Kalanggaman, To get to Malapascua, get a bus from Cebu’s Northern Terminal going to Maya port. From there, hire your own boat, or take the public boat that ferries passengers to Malapascua. From the old Maya port, one can also take a tricycle to the new Maya port, then rent a boat to take you directly to Kalanggaman. Major carriers fly daily from Manila to Tacloban, or to Cebu City.