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Friday, January 6, 2017 Vol. 12 No. 86

Hectic year for capital raising via bourse seen ₧177B F By VG Cabuag

@villygc

und-raising activities of companies via the capital markets may slightly increase this year, despite volatile market conditions. This is because a lot of cash are still in the market chasing so few securities, according to Justino Juan R. Ocampo, executive vice president of First Metro Investment Corp. (FMIC).

inside

The funds raised from PSE primary offerings last year

He said FMIC alone may facilitate three to five listings this year, mostly between P1 billion and P4 billion, with the first likely to be done as early as the first quarter. “For this year, we are courting Continued on A2

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PHL CONTINUES TO ENJOY BELOW-TARGET INFLATION

By Catherine N. Pillas @c_pillas29 & Bianca Cuaresma @BcuaresmaBM

nflation accelerated to 1.8 percent in 2016, faster than the previous year’s 1.4 percent, but still below government projections, the National Economic and Development Authority (Neda) announced on Thursday. The government earlier projected 2016 inflation to fall within the range of 2 percent to 4 percent. Core inflation in 2016 also saw a slowdown to 1.9 percent from 2 percent in 2015. Core inflation is calculated by excluding certain items from the Consumer Price Index, usually energy and food products. Last December inflation inched up to 2.6 percent, from 2.5 last November. “The increase in prices for basic goods and services can be attributed to the holiday season and supply issues on food items,” Socioeconomic Planning Secretary Ernesto M. Pernia said in a statement. Food inflation last month increased to 3.7 percent, from 3.5 percent last November. This was higher than the 1.8 percent in December 2015. Nonfood inflation last December was primarily pushed by transport, rising to 1.9 percent from 0.5 percent last November. The spike in transport costs can be traced to the considerable increase in domestic petroleum prices, such as unleaded gasoline (10 percent, from 3.98 percent); and diesel (16.04

RCEP text likely done by April at Asean meeting A

BYD debuts global SkyRail

HOMEWARD BOUND After spending their Christmas holiday in the Philippines with family and friends, thousands of overseas Filipinos and foreign visitors heading home form long queues at the Ninoy Aquino International Airport in Pasay City on Thursday. NONIE REYES

Duterte open to joint maritime drills with Russia

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resident Duterte will consider joint naval exercises with Russia to enhance the countries’ maritime cooperation, Presidential Spokesman Ernesto C. Abella said on Thursday, months after the Philippines decided to reduce military exercises with the United States. At a briefing in Malacañang, Abella said Duterte considered this

PESO exchange rates n US 49.7320

week’s visit by two Russian warships to the capital Manila as a sign the Philippines could strengthen its naval diplomacy with Russia. Duterte is scheduled to visit one of the ships today, Friday. A memorandum of agreement would need to be signed between the Philippines and Russia to establish the framework of any future naval

drills, Abella added, citing Defense Secretary Delfin N. Lorenzana. Abella said the President still opposed the permanent stay of any foreign troops in his country. On Wednesday Russian Ambassador to the Philippines Igor Khovaev said his country was not interested in military ties with the Philippines, See “Duterte,” A2

sea n member-states w i l l tr y to complete the text of the Regional Comprehensive Economic Partnership (RCEP)—the counterpart of the US-initiated TransPacific Partnership—this year at the occasion of the Philippines’s hosting of the bloc’s meeting, Trade Secretary Ramon M. Lopez said on Thursday. Lopez added that this will be the focus of Asean leaders when they convene in Manila in April. “The main initiative we’ll try to push in the Asean leaders’ meeting is concluding the RCEP,” Lopez told reporters on Thursday. At a meeting of Asean trade ministers last November, the trade chief disclosed that options have been “narrowed” in terms of negotiating a common set of numbers in terms of services and goods to be included in the proposed free-trade agreement (FTA). The RCEP is a megatrade deal aiming to cover goods,

LOPEZ: “The main initiative we’ll try to push in the Asean leaders’ meeting is concluding the RCEP.”

ser v ices, investments, eco nomic and technical cooperation, competition and intellectual-property rights. The 16 countries (Asean nations, plus countries they’ve already concluded FTAs with) involved in the RCEP account for over a quarter of the world’s economy, estimated to be more than $75 trillion. According to a joint statement released after the meeting, the 16 countries have agreed to negotiate the RCEP as a single undertaking, instead of a piecemeal approach, to ensure both goods and services will be prioritized, upon the request of India.

n japan 0.4238 n UK 61.3046 n HK 6.4126 n CHINA 7.1757 n singapore 34.5625 n australia 36.2099 n EU 52.1589 n SAUDI arabia 13.2590

Catherine N. Pillas Source: BSP (5 January 2017 )

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A2 Friday, January 6, 2017

PHL set to launch state-of-the-art air-traffic facilities

he soon-to-be-completed facilities of the nextgeneration satellite-based Communications, Navigation, Surveillance/Air Traffic Management (CNS/ATM) will put the Philippine aviation regulator on a par with its Asian neighbors Japan, South Korea, Singapore and China.

The Japan International Cooperation Agency’s ¥22,049-million project is expected to complete the physical installation of all associated facilities by June this year to make way for full operation by the end of the year. The Philippines would be able to monitor 80 percent of the Manila Flight Information Region as assigned to the Philippines by the International Civil Aviation Organization (ICAO). The CNS/ATM is a computerbased flight data-processing system that enables aircraft operators to meet their planned times of departure and arrival, and adhere to their preferred flight profiles with

Duterte. . .

minimum constraints and without compromising safety. The CNS/ATM was created to establish satellite-based CNS/ATM systems according to the specifications of the ICAO; deploy vital airtransport communication, surveillance and information facilities; and replace aging communication and air-traffic equipment in select airports nationwide. Wit h t he pl a nned deployment, the Civil Aviation Authority of the Philippines will need to engage the services of 500 airtraffic controllers over the next five years, when the satellitebased CNS/ATM system becomes fully operational.

Continued from A1

but said Russia would be willing to help supply arms to the Southeast Asian nation. He also said military drills between the two countries could be an opportunity to share experiences and learn from each other. “This relationship is potentially very significant given that fact that the Philippines was, for

a very long time, the anchor of the US military presence in the region,” said Alexey Muraviev, a Russia defense specialist at Curtin University in Perth, Australia. It also fits with Russia’s strategy of deepening its engagement with countries in the 10-member Association of Southeast Asian Nations, he said. Bloomberg News

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PHL continues to enjoy below-target inflation Continued from A1

percent from 7.41 percent). “The higher prices in transport commodity reflected the hike in international oil prices caused by the oil-producing countries’ decision to cut oil production by almost 1.8 million barrels per day,” Pernia said. For 2017 and 2018, the government expects inflation to be within the target range of 2 percent to 4 percent, taking into consideration the scenario of higher oil prices, pending petitions for adjustments in electricity rates and strong domestic economic activity. “The inflation outlook is supported by the country’s brisk domestic demand conditions, buoyed by solid private household spending, higher government

expenditure and adequate domestic liquidity,” Pernia said. The Bangko Sentral ng Pilipinas (BSP) said it missed its inflation target for 2016 even after consumer prices accelerated last December. The BSP, however, remains optimistic the price movement will return to the target range this year. This is the second consecutive year that inflation fell under the government’s target band. In 2015 inflation averaged 1.4 percent on account of extremely low prices of crude oil. “Inflation for December tipped at 2.6 percent, a tad higher than November’s turnout but within the BSP forecast range of 2.2 percent to 3 percent [for the month]. This brought the full-year average to 1.8 percent. The inflation prints are expected, and in line with our

assessment that inflation would be inching up toward the national government target over the balance of the policy horizon,” BSP Governor Amando M. Tetangco Jr. told reporters on Thursday. “We will continue to monitor global and domestic financial market developments, shifts in global demand and supply of commodities, changes in global growth prospects to see how these would impact the domestic inflation dynamics, and whether there will be any need to make adjustments to our policy levers,” he added. In the central bank Monetary Board policy meeting last December, BSP Deputy Governor for the Monetary Stability Sector Diwa C. Guinigundo said the Monetary Board made revisions to the inflation forecasts for 2017 and 2018.

For 2017, inflation is expected to rise to an average of 3.3 percent from an earlier forecast of 3 percent. For 2018, inflation is seen hitting 3 percent, also up from the November forecast of 2.9 percent. Guinigundo said the higher forecasts boil down to four reasons: the higher-than-expected November 2016 inflation rate; rising oil prices; the impact of stronger domestic economy; and a weaker exchange rate. The BSP also maintained the 2-percent to 4-percent target range until 2019 and 2020. “Structural changes in inflation dynamics alongside improvements in the economy’s productive capacity have been supporting a low and stable inf lation environment that is consistent with the healthy pace of economic growth,” Guinigundo said.

Hectic year for capital raising via bourse seen Continued from A1

market leaders to list at the PSE [Philippine Stock Exchange]. In the fixed income, we anticipate many of them,” Ocampo said. “We expect to be hectic in the first half for the fixed income. The market is very liquid,” he said, adding it may handle at least three during the period. The owner of retail chain Wilcon Depot, which sells home items and other construction supplies, already filed its application for an initial public offering (IPO), hoping to raise as much as P7.9 billion. According to the company’s prospectus filed with the Securities and Exchange Commission, Wilcon Depot Inc. intends to sell around

1.39 billion primary shares at P5.68 per share. The final offer price shall be determined prior to the scheduled listing on March 2017, it said. Audio Wav Media Inc. also filed for its IPO, also slated for the first quarter of the year, hoping to raise between P1.4 billion and P2.4 billion. Absent from the IPO scene, meanwhile, were the Espiritu family’s Datem Inc. and DM Wenceslao and Associates Inc.. Both are in the construction business and in need of huge capital, but deferred their respective IPO last year. Ocampo said there are also other firms from countries, such as South Korea, Japan and Taiwan, that are interested to buy into local companies. He declined to name them.

He, however, said Asian investors are interested in food manufacturing, construction and the fastmoving consumer-goods segment. “We’re hoping to close one in the first half. The size is not too big,” he said. Last year the PSE only raised P177 billion worth of capital from primary offerings, down from the previous year’s P185 billion. FMIC said the PSE index is seen to crawl back to 7,500 within the year—from last year’s close of 6,840.64 points—on strong Philippine fundamentals. Investment banks also see listed companies’ earnings growing 10 percent for the year and investors giving the Philippine stock market a valuation of 17 times

Bautista. . .

price-to-earnings ratio. Cristina Ulang, FMIC head of research, said catalysts for the market’s uptick is the potential for the economic growth to outperform, the government’s fiscal ramp-up delivering and higher corporate earnings. Among the companies First Metro favors under current market conditions include Metro Pacific Investments Corp., Aboitiz Equity Ventures Inc., SM Investments Corp., GT Capital Holdings Inc., Puregold Price Club Inc., Robinsons Retail Holdings Inc., D&L Industries Inc., Centuries Pacific Food Inc., Metropolitan Bank and Trust Co., Security Bank Corp., Robinsons Land Corp., Ayala Land Inc. and Aboitiz Power Corp.

Continued from A12

protection officer as provided for by the Data Privacy Act, or Republic Act 10173. “[The] NPC ‘misappreciated’ the role of the head of agency in a collegial body. It is the en banc that stets a policy that the head of agency is tasked to implement.... Since the law was passed in 2012, the commission had not appointed one. And if an appointment had to be made, not just the head of agency but the entire en banc

Steel traders. . .

will vote on the appointment,” Bautista said. It can be recalled that in March 27, 2016, Anonymous Philippines, a notorious group of online hackers, managed to penetrate the web site of the Comelec and defaced its contents. A day later, another group, LulzSec Pilipinas, leaked online millions of voter registration data, including names, addresses, and birthdays, among others.

Continued from A12

partiality, causing him undue injury and neglecting or refusing to act within reasonable time on a pending matter without sufficient justification. Based on the 11-page complaint affidavit filed on January 3, MRTC’s importation of 20,025 metric tons of steel bars arrived at the Port of Subic on November 4, 2016, under ICC application dated October 28, 2016, filed with DTI Region 3. Last November 18 MRTC wrote to Angeles to inform her that the inspection report transmitted by TUV Rheinland Philippines and the test report from the SGS-CSTC Technical Standards Services Testing Laboratory have been forwarded to her office. The DTI regional office issued a conditional release signed by respondent Angeles last November 3 followed by physical inspection of the shipment by a DTI-Region 3 officer last November 21. MRTC then wrote the DTI office dated November 24, 2016, requesting for the issuance of the Final ICC given the completion of all requirements. The DTI Region 3 issued the Final ICC signed by Angeles on November 29, 2016. “Inexplicably, on December 9, 2016, MRTC received a letter dated December 8, 2016, co-signed by public respondents Angeles and Porciuncula, unilaterally recalling/withdrawing the Final ICC without stating a clear reason therefor,” Sy said. MRTC pointed out that it had complied with all the requirements and regulations, which were the basis for the issuance of the Final ICC attested by Angeles herself in her letter to the company’s lawyers dated December 1, 2016, that “the said import shipments have been found to be in order.” “Clearly, there was no issue as regards the quality and standards of the imported shipment as attested to by no less than public respondent Angeles. The related acts of public respondents…constituted acts done in discharge of their official duties with manifest partiality, evident bad faith or gross inexcusable negligence, which caused undue injury to MRTC,” the complainant added.

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Manila declared gun-free zone during feast of Black Nazarene By Rene Acosta

@reneacostaBM

HE National Police declared Manila a no-gun zone as part of the security preparations for the feast of the Black Nazarene on Monday, and suspended all Permits to Carry Firearms Outside of Residence (PTCFOR) in the city starting on Sunday morning. Director General Ronald M. dela Rosa, National Police chief, issued the order to ensure public safety during the feast, which traditionally draws millions of devotees. Senior Supt. Dionardo Carlos, National Police spokesman, expressed optimism that the temporary suspension of PTCFOR will not be opposed by gun owners in the city. “The suspension of PTCFORs in Manila in relation to the Black Nazarene festivities is to ensure the security of everyone,” Carlos said. “We know that affected gun owners are one with us in keeping the safety and security of the area during the event,” he added. The temporary suspension will cover two days— from 8 a.m. of Sunday to 8 a.m. of Tuesday. The suspension of PTCFOR came as government forces, both the National Police and the Armed Forces, have shifted focused from the Christmas season to the upcoming Black Nazarene feast. Aside from suspending permits to carry firearms, authorities are also looking at disrupting cellular telephone signals in Manila during the procession of the Black Nazarene to thwart any attempt from terrorist groups to explode bombs by using cellular telephones as triggering devices. Authorities are not discounting the possibility that the procession would be targeted by terrorists owing to the expected mammoth crowd. More than 4,000 policemen will be deployed for the feast’s security while the military will field more than 600 personnel.

Editor: Dionisio L. Pelayo • Friday, January 6, 2017 A3

Terror group leader killed, 3 others nabbed in Sarangani

By Allen V. Estabillo | Philippines News Agency

ENERAL SANTOS CITY— Government security forces killed the leader of a notorious armed group that had pledged support to the Islamic State in Iraq and Levant (Daesh) and arrested three of its members in an operation early Thursday in Kiamba, Sarangani. Senior Supt. Leonardo Suan, Police Regional Office-12’s deputy regional director for operations, said Mohammad Jaafar Sabewang Maguid, alias Tokboy, was killed in an encounter at around 1 a.m. at the Angel Beach Resort in Barangay Kitagas, Kiamba. Maguid is the founder and leader of the Ansar Al-Khalifah Philippines, which had been blamed over a string of terror attacks in Sarangani and the neighboring areas these past years. “It’s confirmed. It was Tokboy,” Suan told reporters. He identified the arrested suspects as Matahata Dialawe Arboleda; Ismael Sahak, alias Mael; and Morhaban Veloso, alias Bugoy. Recovered from the suspects were two M-16A2 carbines and a hand grenade.

Su a n s a id t he operat ion w a s launched after a tip off from an informant, who reported the group’s presence at the resort. He said the operation involved personnel from the Central Mindanao police command headquarters, the Regional Public Safety Battalion, Sarangani police’s intelligence branch and the National Intelligence Coordinating Agency. Arnulfo Flores, the resort’s owner, said the Maguid’s group arrived in the area late Wednesday night aboard a red Toyota Wigo sedan with temporary license plate 12190176. Citing accounts from resort personnel, he said operatives initially arrested Maguid’s three cohorts upon entering the area at past midnight.

He said Maguid reportedly tried to escape from the area but was cornered near the boundary of a neighboring beach property. Witnesses said the suspect fired at the policemen during the chase and was eventually gunned down. Maguid, who bolted from the Sarangani provincial jail in 2010, is facing at least 15 warrants of arrest issued by various local courts since 2008. He is facing multiple counts of murder, attempted murder, frustrated murder, robbery with violence, robbery with homicide, destructive arson and arson, filed at Branches 11 and 38 of the Regional Trial Court in Alabel, Sarangani. Authorities tagged Maguid’s group as behind the planting of an improvised explosive last December at a Christmas display in front of the Kiamba town hall. The policemen seized suspected bombmaking materials at his house in Barangay Daliao in Maasim town in October last year. Last August Special Action Force troopers killed three alleged members of the Ansar AlKhalifah, which had pledged support to the Daesh, in an operation in upper Sitio Lebe in Barangay Daliao. Recovered at the site were various highpowered firearms and a black flag bearing Daesh emblem.

It’s confirmed. It was Tokboy.” —Suan

Año gets fourth star

AÑO

HE top officer of the Armed Forces received his fourth star on Thursday, less than a month after assuming the position. Defense Secretary Delfin A. Lorenzana pinned the fourth star on Gen. Eduardo Año, who was with his wife Jean Joselyn, during simple ceremony at the Department of National Defense office in Camp General Emilio Aguinaldo in Quezon City. Año’s promotion to four-star general came less than a month after he succeeded Gen. Ricardo R. Visaya, who retired last December 7, to the post of Armed Forces chief of staff. Prior to his assumption as Armed Forces chief of staff, Año was the commanding general of the 85,000-strong Army, where he got his third star. He is a member of the Philippine Military Academy “Matikas” Class of 1983. He will retire in October this year. Rene Acosta

Economy

A4 Friday, January 6, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

DOE awards 10 RE deals under OSCP 2 By Lenie Lectura

@llectura

he Department of Energy (DOE) has awarded 10 renewable-energy (RE) contracts auctioned under the second open and competitive selection process (OCSP 2). In a posting on its web site, the 10 RE contracts are composed of nine hydropower sites and one geothermal site. First Gen Mindanao Hydropower Corp. of the Lopez group bagged three hydropower contracts under Area 4 BinongonanTineg, Area 15 Cateel and Area 16 Cagayan 1N. Vivant Energy Corp. was awarded with two contracts—Area 12 Tubig and Area 13 Buhid. Trans-Asia Oil & Energy Development Corp. won the bid to develop Area 7 Ilog hydro contract. The remaining three hydropower contracts—Area 14 Bugtong, Area 17 Agus III and Area 2 Southern Leyte —were awarded to Clean N Energy Solutions Inc., Marano Energy Corp. and Repower Energy Development Corp. respectively.

The geothermal contract under Area 3 Amacan was awarded to another Lopez-led Energy Development Corp. The agency earlier tendered 21 RE deals under OCSP 2, composed of four geothermal sites with aggregate potential capacity of up to 134 megawatts (MW) and 17 hydropower sites with capacity of up to 733.4 MW. The DOE said it did not receive bid proposals for the following identified hydro and geothermal sites: Area 5 Sinambalan 1, Area 6 Pagbalan 1, Area 11 Hilabngan 3 for hydro and Area 1 Acupan-Itogon and Area 3 Balut Island for geothermal. Meanwhile, the bids submitted for the following hydropower sites failed to qualify: These are Area 1 Madongan 1, Area 2 Madongan 2, Area 3 Solsona, Area 8 Binalbagan 1 and 2 and Area 10 Binulog. “In view of this, we hereby declare the above-mentioned areas open for direct negotiation subject to the compliance of regulatory requirements under Section 10 of Department Circular 200907-0011,” the DOE said.

briefs p2.2-b loan for nina-hit gsis members, pensioners THE Government Service Insurance System (GSIS) has allotted P2.2 billion in emergency loan for its members and pensioners hit by Typhoon Nina (international code name Nock-ten) in Catanduanes, Albay, and Camarines Sur. A total of 62,339 active members and 11,115 old-age pensioners from the said areas stand to benefit from the loan window. Application deadline for the loan is until February 2. Qualified to apply for the loan are active members residing or working in the areas, not on leave of absence without pay, have no arrears in paying premium contributions, and have no unpaid loans for more than six months. Members who are availing of the loan for the first time may apply for a P20,000 emergency loan, while those with loan balance may borrow P40,000. The loan is payable in 36 equal monthly installments at a 6-percent interest rate per annum computed in advance. It is covered by a loan-redemption insurance, which deems the loan fully paid in case of the borrower’s demise provided the loan repayment is up to date. Active members may apply through any GSIS Wireless Automated Processing System kiosk in all GSIS branch and extension offices; provincial capitols; city halls; selected municipal offices; large government agencies, such as the Department of Education; Robinsons Malls; and selected SM City branches in North Edsa, Manila, Pampanga, Cebu and SM Aura in Taguig. PNA

eastern visayas workers to benefit from end of ‘endo’

TACLOBAN CITY—More than 2,000 workers from three giant retails shops in this city stand to benefit from the end of contract, or endo, but their fate largely depends on the final approval of a new policy banning the said labor practice. More than a month ago, labor department inspectors found that many workers of Robinsons Place Tacloban, Gaisano Capital and Gaisano Central are only contractual workers. “We’re supposed to decide on this, since it’s been more than 30 days since we got the findings, but we have to wait for the new department order to make sure that the decision of our hearing officers is consistent with the national policy and existing laws,” Department of Labor and Employment Regional Information Officer Virgilio Doroja Jr. said. Labor Secretary Silvestre Bello III released on December 28, 2016, Department Order (DO) 30, mandating manpower services firms to hire workers as regulars, receiving full benefits, such as leave credits and 13th-month pay, as well as retirement, social security and health-insurance plans, among others. President Duterte has reportedly refused to sign the new directive as the Chief Executive insisted that companies, and not contractor, should directly hire regular workers. “This is what we want to resolve now as to who will assume the responsibility of making these workers regular. We have to wait and see,” Doroja added. DO 30 is set to replace DO 18-A, or the rules implementing Articles 106 to 109 of the Labor Code. Under the new directive, manpower agencies are mandated to hire regular workers and pay them salaries even after the end of service-agreement contract with companies. Contractors are also ordered to deploy workers to another firm within three months after a service agreement. PNA

cebu capitol gives p3-m financial assistance to sinulog CEBU CITY—The Cebu provincial government has given a P3-million financial assistance to the Sinulog Foundation Inc. (SFI), the organizers of the annual Sinulog Festival set this year on January 15, an official said. Cebu Provincial Treasurer Emmanuel Guial said the monetary assistance the provincial government extended to the SFI was taken from the 2016 budget of the provincial government. Guial said the provincial government forwarded the financial assistance to the SFI in December last year, after receiving the foundation’s request. Guial said the SFI may avail itself of future financial assistance for the Sinulog, but it has to liquidate the expenses charged to the previous financial assistance. As this developed, Cebu Gov. Hilario Davide III said big events that attract visitors, such as the Sinulog Festival, are always a concern when it comes to security. Davide urged everyone to be always watchful and vigilant. Davide also said he was not completely amenable to the plans of Cebu City Mayor Tomas Osmeña to shut off communication signals at the grandstand during the festivities for security reasons. “Communication is very important, especially for security. Communication is critical, especially in our law-enforcement groups—the police, the military, even the government office, government officials who are involved in the preparations for the festivities,” Davide said. PNA

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Sugar farmers bare ‘slave labor’ in Hacienda Luisita plantation

By Jonathan L. Mayuga

@jonlmayuga

ecause of extreme hunger and poverty, farmers from as far as Mindanao are forced to work in sugarcane plantations in Luzon only to earn a paltry P10 a day, the Unyon ng Manggagawa sa Agrikultura (UMA) said on Thursday. The situation, UMA SecretaryGeneral Danilo Ramos said, depicts the dire situation of landless farmers in Mindanao, who are easily lured by manpower agencies with the promise of good pay and working condition, only to end up as “slaves” in sugar plantations. In particular, Ramos said Hacienda Luisita Inc. employs plantation workers for a measly pay, contrary to what the farmers were promised, a situation that, he said, they heard of more than a decade ago. Ramos urged the Duterte administration to look into the situation of Mindanao farmers who continue to work under such dire conditions, citing the case of 58year-old Mario Bagnaran. Mario is among the first batch of sacadas to file a complaint with the National Labor Relations Commission (NLRC) against the recruiter, Greenhand, and the principal employer, Agrikulto Inc. and Central Azucarera de Tarlac (CAT). Agrikulto and CAT are now jointly owned and managed by the Cojuangco-Aquino clan, led by Fernando Cojuangco with Martin Lorenzo, a scion of the Lorenzo landlord family who is also currently embroiled in land disputes with farmers in banana plantations under Lapanday Foods Corp. in Mindanao. A farmworker in pineapple plantations in Maramag, Bukidnon, Mario decided to accompany fellow workers from his barangay recruited by

₧10 a day The paltry daily wage given to farmers hauled off from Mindanao to Luzon sugarcane plantations, notably the Hacienda Luisita owned by the Aquino-Cojuangco clan Greenhand Labor Service Cooperative for a “livelihood project” in Tarlac last November. A few minutes after leaving the NLRC office, he received an urgent call and was told that his elder brother, Brixcio Sr. 64, had died of the illness he contracted from working in Hacienda Luisita. His nephew, Brixcio’s Junior, was still in Tarlac, waiting to be “rescued”. Mario is among the 43 sacadas from Bukidnon who decided to leave Hacienda Luisita only two months into their supposed work contract. They were assisted by the national office of the UMA through communications from a local farmworkers’ union in Bukidnon, the Organisasyon sa Yanong Obrerong Nagkahiusa (OGYON). Ramos said the sacadas also are victims of human trafficking. Among the sacadas “rescued” last December 25 to 31 are four minors, while 24 others are indigenous peo-

ple, or lumad, who belong to the Manobo tribe. Junior and eight other sacadas finally had the chance to leave Hacienda Luisita. They had been camping out in the sugarcane fields for days, because they refused to go back to their bunkhouse. After they saved enough for their fare to Manila, they went straight where the others sought temporary shelter. According to Ramos, as early as August last year, the recruiters from Greenhand, headed by a certain Billy Baitus based in Polomolok, South Cotabato, said it was already milling season in Tarlac. With Mindanao still reeling from the dry spell and sugar plantations in Bukidnon have yet to escape from the curse of tiempo muerto, or dead season, the recruiters were able to convince a group of farmers to accept the “job offer”. The workers were promised wages higher than the rates in Bukidnon, a province also known for its sugarcane plantations and mills. The recruiters said they were to be housed in a hotel very near a hospital, so that all their medical needs would be properly attended to. They would have free provisions and benefits. Transportation to and from Hacienda Luisita would also be free. They will get a cash advance that they could leave with their families. Mario went to Hacienda Luisita last November with five other men with the Bagnaran family name. Instead of a hotel, however, they were housed in a cramped bunkhouse owned by the Cojuangco firm Agrikulto Inc., with hundreds of other sacadas from different Mindanao provinces. However, instead of what was promised, everything in the house had to be paid for. Evem kitchen supplies and work tools were deducted from their measly pay. “They had to work even before first light, and they were hauled back to the bunkhouse late afternoon, when it become too dark for them to cut cane,” Ramos lamented. Paid based on pakyaw, or group

rates, that could yield slave wages averaging only P180 each week, Ramos said some of the workers complained that one payroll even revealed that they earned only P66.21 from December 5 to 13, or equivalent to only P9.46 per day of hard work. Mario’s elder brother Brixcio Sr. contracted a lung illness en route to Hacienda Luisita and was not able to work in the fields. He was finally brought to a clinic, but was only given analgesics to ease his condition. Brixcio Sr. was made to stay in the bunkhouse for a month, before the supervisors were finally convinced that he must be sent home immediately if they would not allow him proper medical care. Brixcio Sr. died on Wednesday in Bukidnon. “We could not send any money home, we did not even earn enough for our daily sustenance,” Mario complained during a press conference at the Department of Agrarian Reform (DAR), where the “rescued” plantation workers aired their grievances. The group would soon be going back to Mindanao with the help of the Department of Social Welfare and Development (DSWD), after UMA sought the help of Secretary Judy Taguiwalo. According to Ramos, Taguiwalo promised to enroll the farmers from Mindanao under the agency’s “BalikProbinsya Program,” being among the poorest of the poor. “For the meantime, they would be camping inside the DAR. He said the farmers are hoping to personally appeal to DAR Secretary Rafael Mariano,” Ramos said. The Mindanao farmers are landless and are all qualified to become awardees of government land under the Comprehensive Agrarian Reform Program. According to Ramos, the only way for exploitation of agricultural plantations on poor farmers is for the government to provide them land through its land-transfer program, and support for them to sustain agricultural production on their own.

House leaders dispute Lacson’s ‘pork’ allegations in 2017 budget By Jovee Marie N. dela Cruz @joveemarie

he leadership of the House of Representatives on Thursday denied that there were “pork barrel” funds in the recently signed 2017 P3.35trillion General Appropriations Act (GAA). Speaker Pantaleon D. Alvarez said the lawmakers’ P80 million worth of projects under the 2017 budget are not pork barrel, which was declared unconstitutional by the Supreme Court (SC), as these projects were all listed in the GAA. “There were no pork barrel funds. The real pork barrel is lump-sum appropriation. But now all are transparent. [Under the GAA, there are] specific line-item projects that have been identified by different agencies and departments of government,” he said. Sen. Panfilo Lacson earlier said some senators and congressmen got billions of pesos in pork barrel, after the Department of Public Works and Highways (DPWH) regained its slashed P8-billion pork in the 2017 budget, and even got an additional budget of P497 million. L acson sa id t he DPW H has P454.721 billion from the P445.766 billion that was approved by Congress, regaining its more than P8.557 billion in pork barrel funds that were removed by the Senate under this year’s P3.35-trillion GAA.

The senator added that the funds were taken from the National Disaster Risk Reduction and Management Fund (NDRRMF), or the calamity fund under the Special Purpose Fund, which was reduced from P37.255 billion to P15.755 billion. For his part, House Appropriations Committee Chairman Karlo Alexei Nograles of Davao City said that Lacson is only “confused” in making his claim that the 2017 National Expenditure Program is rigged with pork barrel. “That’s not true. There is no pork barrel. There is no PDAF [Priority Development Assistance Fund] in the budget. There are no postenactment projects in the budget. I think that Senator Lacson is confused about this issue,” Nograles said. The lawmaker said the budget process involved a two-tiered approach, wherein different agencies and departments of government identify ongoing projects in tier 1, and then identifies new projects in tier 2. All the projects were evaluated by the Department of Budget and Management (DBM) before the National Expenditure Program was finalized and submitted to the House of Representatives, Nograles said. “From its inception, the projects and programs have been itemized and spelled out clearly and specifically. From the House all the way to the Senate,

Tamper proof

Manila Electric Co. linemen climb atop an electric post to transfer a set of household electric meters to a new concrete post, safe from tampering by power thieves on Marcos Highway in Antipolo City on Thursday. PNA

the DBM monitors every movement of the budget process to ensure there is no violation of the SC decision against pork barrel,” he added. “We in Congress also exercised strict adherence against the pork barrel to ensure that we comply with the SC decision. If anything, we have made doubly sure that projects and programs are even more specific, so there will be no room at all for postenactment. All our hearings and deliberations will bear this out—which have always been transparent and open. The budget book itself is a public document open to scrutiny by anyone,” Nograles added. Nograles also disputed Lacson’s claim that the country’s calamity

fund was slashed to grant pork barrel for President Duterte’s congressional allies, as he guaranteed there would be no shortage of fund that would be used during calamities and other national emergencies. “Let me reassure the public that the balance of the 2016 Calamity Fund as of October 31, 2016, was around P30 billion. So we may assume that up to December 31, 2016, the estimated balance may be around P25 billion. This fund will be carried over to 2017. So adding this to the new 2017 appropriations of P15.755 billion, the total calamity fund at government’s disposal for 2017 will be more than P40 billion pesos,” Nograles said.

Agriculture/ Commodities BusinessMirror

Editor: Jennifer A. Ng • Friday, January 6, 2017

Farm-gate price of palay reached P17.85 a kilo by year-end 2016 By Jasper Emmanuel Y. Arcalas

@jearcalas

HE average farm-gate price of unmilled rice sustained its uptrend, reaching P17.85 per kilogram just before 2016 ended, the Philippine Statistics Authority (PSA) said in its latest report. The figure was 1.88 percent higher than the P17.52/kg average farm-gate price of palay recorded in the same time period last year, according to the PSA’s report, “Updates on Palay, Rice and Corn Prices,” published on January 4. “The average farm-gate price of palay at P17.85 per kilo gained by 0.07 percent from a week ago and by 1.88 percent from the price of the same period last year,” the PSA report read. The PSA report showed it was the eighth consecutive week since the first week of November last year when the average farm-gate price of unmilled rice increased. PSA data showed regular milled rice during the December 21 to 27 period also increased. “The average wholesale price of regular milled rice during the week went up by 0.16 percent from last week’s level. This week’s quotation of P34.42/kg was also higher than last year’s level by 1.23 percent,” the PSA report read. “Quoted at P37.17/kg, the retail price of regular milled rice registered a 0.04-percent uptick from the previous week’s level of P37.16/kg. Compared to last year’s quotation, it inched up by 1.1 percent,” the PSA added. The average wholesale price of wellmilled rice is still on the uptrend, further increasing to P38.24/kg, compared to P38.20/kg recorded in the third week of December. The figure was a little bit higher than last year’s price of P37.78/kg. “At the retail trade, the average price of well milled rice at P41.48/kg posted a decrease of 0.11 percent from P41.53/kg last week. Meanwhile, a mark-up of 0.96 percent from last year’s price was noted,” the PSA report read. The same PSA report said the average farm-gate price of yellow corn in end-December decreased to P10.85/kg, 5.71 percent lower than the P11.50/kg recorded same time period last year. The figure is also lower than the third week of December’s price of P10.98/kg. “The average wholesale price of yellowcorn grain at P16.95/kg posted respective price decreases of 0.06 percent and 0.24 percent from a week ago and last year’s levels,” the PSA report read. “The average wholesale price of whitecorn grain maintained its last week’s level of P15.10/kg. Relative to its previous year’s level, it went down by 1.79 percent,” the PSA report added.

DA to build ₧10-M ‘lacatan’ nursery

HE Department of Agriculture (DA) said it is planning to establish a P10million lacatan nursery in Marinduque to boost the production of the fruit in the province. Lacatan is a popular variety of banana in the country. “We will buy the shoots of lacatan in this province and we will grow it in the nursery. Afterward, we will return and distribute the young plants to you,” Agriculture Secretary Emmanuel F. Piñol told 500 farmers and fishermen in Marinduque on Thursday. The farmers were severely affected by Typhoon Nina’s (international code name Nock-ten) landfall in the province. “If the bananas in the province do not suffer any disease, then it is better to protect its seedlings for production,” Piñol added. During Piñol’s visit in Marinduque, the province received P6.3 million worth of agricultural assistance from the DA for the rehabilitation program for both agriculture and fishery industries badly damaged by Nina, Piñol said. The figure was 581 percent higher than the P985,000 initial assistance committed by the DA to Marinduque. “I am amazed at the resilience of the people of Marinduque,” Piñol said. Jasper Emmanuel Arcalas

The World BusinessMirror

Friday, January 6, 2017

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

Why men don’t want jobs done mostly by women

Bridgette Hunter works with a mannequin during a class to become a certified nurse’s assistant in Laurel, Maryland. While more than a fifth of American men aren’t working, they aren’t running to new service-sector jobs in fields like home health and nursing, sometimes because they require very different skills, and pay a lot less, but also because many are seen as women’s work. Andrew Cutraro/The New York Times

Pedestrians walking in and out of Macy’s in the skyway connecting it to the IDS Building in downtown Minneapolis. Carlos Gonzalez/Star Tribune via AP

Macy’s to cut 10,000 jobs after poor holiday sales

EW YORK—Struggling with sagging sales over another crucial holiday shopping season, Macy’s announced on Wednesday that it was eliminating more than 10,000 jobs as part of a continuing plan to cut costs and close 100 stores.

Macy’s, the country’s largest department-store chain, said sales at its stores had fallen 2.1 percent in November and December, compared with the same period in 2015. Terry J. Lundgren, the company’s chairman and chief executive, said in a statement that, while the trend was “consistent with the lower end of our guidance, we had anticipated sales would be stronger.” He attributed the decline to “broader challenges” facing much of the retail industry. Consumers, who endured a long recession, have turned to low-cost chains like, T.J. Maxx, and shifted their spending away

100 The number of stores that Macy’s will close

from brick-and-mortar stores for the convenience of online shopping with the retail giant Amazon. The announcement on Wednesday continued a trend for Macy’s, which announced last January

that it was eliminating about 4,500 jobs in a major restructuring. Then, too, it said slumping holiday season sales had hurt its bottom line. The company, which now has 730 stores, announced in August that it would close 100 of them. On Wednesday it identified 68 stores to be closed. The 158,000-squarefoot store in the Douglaston neighborhood of Queens, which opened in 1981, will close. Stores at the Marketplace Mall in Rochester; at the Oakdale Mall in Johnson City, near Binghamton; and at the Preakness Shopping Center in Wayne, New Jersey, will close, the company said. Of the 68, three were closed by the middle of 2016, 63 will close in the spring and two will be closed by the middle of 2017. Three other locations were sold or are to be sold. The company said it planned to close about 30 other stores over the next few years. Some employees may be offered positions at nearby stores, but Macy’s estimated that 3,900 workers would be affected by the closings. It also said it planned

to restructure parts of its business, leading to a reduction of an additional 6,200 jobs. Overall, the job cuts represent about 7 percent of its work force. The company estimated that the changes would save about $550 million a year, starting in 2017. Lundgren said the company was closing stores that were “unproductive or are no longer robust shopping destinations because of changes in the local retail shopping landscape.” Other sites were being targeted for closing to take advantage of their highly valued real estate. The company, which owns the Macy’s and Bloomingdale’s brands, has been struggling with declining traffic in its stores, where the bulk of its business is still conducted. It plans to invest some of its savings in expanding its digital business. Macy’s said it now expected to earn $2.95 to $3.10 per share on an adjusted basis for fiscal 2016, compared with its prior forecast of $3.15 to $3.40 per share. Shares in Macy’s fell nearly 10 percent to $32.30 in after-hours trading on Wednesday. New York Times News Service

‘UK should use Canadian-style visa system’

ritain should introduce a Canadian-style immigration system to help ease the conflict at the center of the Brexit debate, a panel of lawmakers said. Such a system would devolve decisions over immigration, allowing local administrations to set quotas based on “economic and cultural needs,” the All Party Parliamentary Group on Social Integration said in a report published on Thursday. It also said migrants should have

to learn English and urged the government to promote awareness of UK laws, tradition and culture. “It’s clear that immigration has impacted on different communities in different ways and the pace of change has alarmed many,” said Chuka Umunna, the opposition Labour Party lawmaker who heads the committee. Government immigration policy should be “a middle way between the laissez-faire multiculturalism

favored by successive British governments and the assimilationist politics of the French Burkini ban.” Immigration was a key reason why Britons voted last year to leave the European Union and Prime Minister Theresa May has pledged restrictions as she prepares to trigger formal Brexit talks by the end of March. The feeling is not shared by all. Scottish First Minister Nicola Sturgeon advocates the UK remaining

in the European Economic Area, which ensures the free movement of people, while London Mayor Sadiq Khan has said he wants a bespoke immigration policy for the capital to avoid a “chronic skills shortage.” Net migration stood at a nearrecord 335,000 in the 12 months through June 2016, the latest official figures show. May’s government has said it wants to reduce it to below 100,000. Bloomberg News

t hasn’t been a great time to be a man without a job. The jobs that have been disappearing, like machine operator, are predominantly those that men do. The occupations that are growing, like health aide, employ mostly women. One solution is for the men who have lost jobs in factories to become health aides. But while more than a fifth of American men aren’t working, they aren’t running to these new service-sector jobs. Why? They require very different skills, and pay a lot less. They’re also seen as women’s work, which has always been devalued in the US labor market. The two occupations predicted by the Bureau of Labor Statistics to decline most quickly from 2014 to 2024 are locomotive firers, shrinking 70 percent, and vehicle electronics installers and repairers, down 50 percent. They are 96 percent and 98 percent male. Of the fastest-growing jobs, many are various types of health aides, which are about 90 percent female. When men take these socalled pink-collar jobs, they have more job security and wage growth than in blue-collar work, according to recent research. But they are paid less and feel stigmatized. “ The jobs being created are very different than the jobs being eliminated,” said David Autor, an economist at Massachusetts Institute of Technolog y (MIT). “I’m not worried about whether there will be jobs. I’m ver y wor r ied about whet her there will be jobs for low-educated adults, especially the males, who seem very reluctant to take the new jobs.” Take Tracy Dawson, 53, a welder in Saint Clair, Missouri, lost several jobs, some because his employers took the work to China and Mexico and others because the workers were replaced by robots. He has heard the promises of fast-growing jobs in the healthcare field: His daughter trained to be a medical technician. But he never considered it. “I ain’t gonna be a nurse; I don’t have the tolerance for people,” he said. “I don’t want it to sound bad, but I’ve always seen a woman in the position of a nurse or some kind of health-care worker. I see it as more of a woman’s touch.” Also, health aides earn a median wage of $10.50 an hour. Dawson used to earn $18 an hour making railroad traction motors. “I was a welder—that’s all I know how to do,” said Dawson, who is living on disability insurance because he has rheumatoid arthritis. Women were hit harder than men by the decline in middle-skill jobs, according to Autor. But they have more easily moved into the expanding occupations, and earn more college degrees than men. Women have always entered male-dominated fields—usually well-paid, professional ones— more than men have entered female-dominated ones. There are now many female lawyers, but male nurses are still rare.

One reason is that jobs done by women, especially caregiving jobs, have always had lower pay and lower status. Yet, when men, especially white men, enter femaledominated fields, they are paid more and promoted faster than women, a phenomenon known as the “glass escalator.” Much of men’s resistance to pink-collar jobs is tied up in the culture of masculinity, say people who study the issue. Women are assumed to be empathetic and caring; men are supposed to be strong, tough and able to support a family. “ Traditional masculinity is standing in the way of workingclass men’s employment, and I think it’s a problem,” said Andrew Cherlin, a sociologist and publicpolicy professor at Johns Hopkins and author of Labor’s Love Lost: The Rise and Fall of the Working-Class Family in America. “We have a cultural lag where our views of masculinity have not caught up to the change in the job market,” he said. But telling working-class men to take feminine jobs plays to their anxieties and comes off as condescending, said Joan Williams, a professor at University of California, Hastings College of the Law, and author of Reshaping the Work-Family Debate: Why Men and Class Matter. “White working-class men’s wages have plummeted, and what happens to men in that context is anxieties about whether they’re ‘real men’,” she said. It’s no surprise, then, that Donald J. Trump appealed to men who feel this way—not just his promises to bring back factory jobs, but also his machismo. Many unemployed men who did manual labor say they can’t take the time and make the effort to train for a new career because they have bills to pay. And they say they chose their original careers because they wanted to build things, not take care of people. Lawrence Katz, an economist at Harvard, has a term for this: “retrospective wait unemployment,” or “looking for the job you used to have.” “It’s not a skill mismatch, but an identity mismatch,” he said. “It’s not that they couldn’t become a health worker, it’s that people have backward views of what their identity is.” Technical health-care jobs, like ultrasound technician—requiring more training but not a college degree—paid 22 percent more than other blue-collar jobs, after controlling for things like education. They involve less interaction with patients and more with computers, so they are less stereotypically feminine. There is an education and race divide among the men who take these jobs, the study found. Black men were 3.3 times as likely as white men to take the lowest-rung health jobs, and other minority men were 1.8 times as likely. White men were more likely to take the higher-status technical jobs. New York Times News Service

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

The World BusinessMirror

Friday, January 6, 2017

Fed sees faster economic growth under Trump, but not a boom W ASHINGTON—Federal Reserve (the Fed) officials expect Donald J. Trump’s election to result in somewhat faster economic growth over the next several years, but they see little chance of the boom Trump has promised, according to an account of the Fed’s most recent meeting last mid-December.

That is in part because the Fed plans to raise interest rates more quickly if growth accelerates. T he m i nutes, re lea sed on Wednesday, offer more evidence that the Fed sees itself as a counter weight to Trump’s promised policies of ta x cuts and infrastructure and militar y spending. They also show just how much Trump’s unexpected victor y has clouded the economic outlook for 2017. The Fed raised its benchmark rate for just the second time since 2008 at the December meeting, citing the continued expansion of the economy and the steady decline of unemployment. The Fed debated and delayed that

increase for most of last year, but the account published on Wed nesd ay a f ter a st a nd a rd three-week delay described the final decision as uncontroversial. Officials instead spent the meet i ng t a l k i ng about wh at came next. The officials, led by Chairman Janet L. Yellen, expect to raise rates three times this year. But the account contains several affirmations that Fed officials are ready to raise rates more quickly if necessary. Citing “uncer taint y regarding fiscal and other economic policies,” the minutes said many Fed officia ls “emphasized that the greater uncer taint y about t hese pol ic ies m ade it more

A worker balances himself while working on the framing of a house under construction in Coppell, Texas. AP/LM Otero

c h a l leng i ng to com mu n ic ate to the public about the likely path of the federa l funds rate.” In particu lar, the minutes said that officials wanted the public to understand that the Fed ’s prediction about the pace of rate increases depended on its prediction about economic growth. Faster growth would mean faster increases. By holding rates at low levels, the Fed has sought to increase economic growth by encouraging borrowing and risk-taking; higher rates reduce the stimulative effect. T he benchmark rate now sits in a range from

0. 5 percent to 0.75 percent, still a ver y low level by historic a l st a nd a rd s. The economic forecast prepared by the Fed’s staff anticipates that Trump’s election will result in “slightly higher” growth over the next several years. Trump, in concert with congressional Republicans, is expected to cut taxes and perhaps to increase federal spending in some areas. But the Fed predicts the benefits will be “substantially counterbalanced” by higher interest rates and a stronger dollar, which will reduce exports of US goods and services.

Most Fed officials, in their own forecasts, also saw an increased chance of faster growth. But they said Trump’s election had clouded the outlook. “Participants emphasized their uncertainty about the timing, size and composition of any future fiscal and other economic policy initiatives, as well as about how those policies might affect aggregate demand and supply,” the minutes said. Several Fed officials reported that Trump’s election had increased optimism among business executives in their districts. “Some contacts thought that their businesses could benefit from possible changes in federal spending, tax and regulatory policies,” the minutes said. The Fed noted, however, that some executives also were concerned about the negative impact of other proposed policy changes. In a recent interview, John Williams, president of the Federal Reserve Bank of San Francisco, said many executives in his district, which encompasses the western United States, worried about the potential impact of restrictions on immigration and on foreign trade. Businesses across the country also reported increased difficulty in hiring qualified workers,

the minutes said. The unemployment rate fell to just 4.6 percent last November. Trump and congressional Republicans want to pass a package of tax cuts this year, and they could take other steps to stimulate economic growth. It could take some time, however, for those measures to increase the pace of economic growth. And independent economists, like most Fed officials, are not convinced that such measures would result in significantly faster growth. Current economic growth is at roughly the pace that most Fed officials regard as sustainable. The work force is growing slowly as baby boomers retire, and productivity also has increased slowly in recent years. The result is that 2-percent growth may be about as good as it gets for the US. Fiscal stimulus might produce a burst of faster growth, but Fed officials are concerned that it also would drive higher inf lation. To prevent that, the Fed could move to raise rates more quickly than it currently projects. The account added that Fed officials were confident in their ability to prevent overheating, seeing “only a modest risk ” of a “sharp acceleration in prices.” New York Times News Service

Senate GOP opens fight over Obama health law W

A SHI NGTON — Congress opened for battle over the A ffordable Care Act on Wednesday as Republicans pushed immediately forward to repeal the health-care law and President Barack Obama made a rare trip to Capitol Hill to defend it. The bitterness that has long marked the fight intensified as Republicans seized the opportunity to make good on a central campaign promise to get rid of the law, a pledge reinforced on Wednesday by Vice President-elect Mike Pence, who met with House Republicans not far from where the president gathered with Democrats. T he A f ford able C a re A c t, Obama’s signature health-care law, has created online insurance marketplaces, offered new protections to people seeking health insurance, and provided coverage to millions of people near the poverty line through expanded Medicaid. Hea lt h- pol ic y e x per t s say system could collapse if Republicans cut off funds for the expanded coverage and end penalties for people who go without health insurance. “The American people voted decisively for a better future for health care in this country,” Pence said, “and we are determined to give them that.” He suggested that Presidentelect Donald J. Trump would use his executive authority to help make the transition away from the health-care law, but did not offer specifics. Democrats vowed aggressive resistance, however, and said they would not participate in drawing up a replacement for the law after the swift efforts to unravel it. Sen. Chuck Schumer of New York, the new Democratic leader, playing off Trump’s campaign slogan, said repealing the law would “make America sick again.” Republicans are using a procedural approach that will allow them to repeal substantial parts of the health-care law without the

President Barack Obama arrives at the US Capitol on Wednesday morning to meet with Congressional Democrats to discuss Republican efforts to repeal the Affordable Care Act in Washington. To Obama’s right is: Rep. Frederica Wilson (Democrat-Florida), Sen. Chuck Schumer (Democrat-New York) and House Minority Leader Nancy Pelosi (Democrat-California). Al Drago/The New York Times

20M

The number of Americans provided insurance under Obama’s Affordable Care Act

Democrats being able to mount a filibuster in the Senate. By a vote of 51-48 on Wednesday, the Senate took the first step, agreeing to take up a budget resolution, or blueprint, that would clear the way for legislation repealing major provisions of the law. But even as they spoke of moving quickly to repeal the law, it remained far less clear how and when they would go about replacing it. Senate debate on the budget resolution is expected to continue for several days, and the House plans to take up the measure once

the Senate has approved it. As Republicans charged ahead, both sides seemed cognizant of the possible fallout from unwinding the law, which has become deeply enmeshed with America’s healthcare system and has provided insurance for about 20 million people. Trump weighed in with several Twitter posts. He advised that Republicans needed to “ be careful in that the Dems own the failed Obamacare disaster,” and added, “Don’t let the Schumer clowns out of this web.” Trump predicted that the health care law would “fall of its own weight.” Rep. Chris Collins, RepublicanNew York, who is one of Trump’s top supporters in Congress and is part of his transition team, said it was important to be sure that Democrats bear responsibility for the failings of the health-care law. Republicans say that premiums and deductibles have skyrocketed and that consumers in many states

have fewer choices of health plans. “We have to make sure we keep reminding America, we are repealing it because it failed, we are repealing it because they all but demanded that we repeal it,” he said. “And that was a key piece of Donald Trump’s campaign.” But as Republicans expressed eagerness to repeal the law, they acknowledged that replacing it would take more time. It is also unclear how insurance companies will react during this period and whether they will continue to offer the marketplace plans that millions of people have come to rely on. “There will naturally be a reasonable transition period,” said Sen. Ted Cruz, Republican-Texas. “You can’t adopt new reforms all at once.” Sen. John Cornyn of Texas, the No. 2 Senate Republican, noted that it had taken six years to get into “the ditch we find ourselves in now.” “When your truck or car is in a ditch, the first thing you need to

do is get out of the ditch,” Cornyn said. “And sometimes that takes a lot of hard work.” To that, Sen. Debbie Stabenow, Democrat-Michigan, parried that when a car goes into a ditch, “the first thing I don’t do is dismantle the car.” “That doesn’t help me get anywhere in terms of transportation,” she said. Democrats signaled little interest in helping Republicans determine what to do after repealing major parts of the health-care law. Schumer predicted that in a year, Republicans would “regret that they came out so fast out of the box.” He said Democrats would consider working on a replacement only after Republicans presented their own plan. “If you are repealing, show us what you’ll replace it with first,” Schumer said. “Then we’ll look at what you have and see what we can do.” Later, Schumer said of Trump,

“It’s his and their responsibility, plain and simple—name calling isn’t going to get anything done.” He added, “They really need to calm things down a little.” Speaker Paul Ryan tried to offer assurance that no change in coverage would be abrupt. “The point is, in 2017, we don’t want people to be caught with nothing,” he said. “We want to make sure that there’s an orderly transition so that the rug is not pulled out from under the families who are currently struggling under Obamacare while we bring relief.” Obama huddled with congressional Democrats for about 90 minutes in what was billed by the White House as a strategy session to forge a unified Democratic response to the Republicans’ rollback effort. In reality, the session was essentially a going-away party for a man who passed his signature legislative accomplishment under long-extinct majorities in Congress and a “pep rally” for Affordable Care Act defenders, in the words of an attendee, Rep. Hank Johnson, Democrat-Georgia. The gathering, which could be Obama’s last trip to the halls of Congress that have been the site of alternating triumph and defeat, had a two-weeks-beforegraduation air, with numerous Democratic lawmakers, including Johnson, sneaking out to attend to business more pressing than hearing the president’s words. Obama, for his part, did not ask his allies to block all efforts to alter the law, but warned Democrats against “rescuing” Republicans by defecting on votes that would dismantle it. The president provided an array of arguments for keeping the Affordable Care Act and offered a mild mea culpa for his shortcomings as a salesman over the years. Sen. Jeff Merkley, DemocratOregon, said, “He acknowledged the failures in selling the law in its entirety to the American people.” New York Times News Service

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Friday, January 6, 2017

briefs

Istanbul on alert as hunt for gunman reaches 4th day ISTANBUL—The police increased security around Istanbul on Wednesday and detained some 20 people with suspected links to the deadly New Year’s Eve night club attack as the hunt for the gunman stretched into a fourth day. Turkish Foreign Minister Mevlut Cavusoglu said the gunman— who killed 39 people during New Year’s celebrations at the Reina club before reportedly escaping in a taxi—had been identified, but did not name him. The police set up checkpoints across Istanbul as security levels remained high. They stopped cars and taxis, with passengers and drivers holding up their identifications while officers inspected the vehicles. Some 20 people, including 11 women, were taken into custody in police raids in the Aegean port city of Izmir, the state-run Anadolu agency said. AP

Man suspected of having terror link arrested at Heathrow LONDON—A 50-year-old man has been arrested at London Heathrow airport on suspicion of a terrorism offense. British police say the man was taken into custody by counterterrorism officers after arriving in Britain on a flight from Cairo on Wednesday. He was arrested on suspicion of possessing articles which contained information likely to be useful to a person planning an act of terrorism. A property in north London was being searched as part of the investigation. The police have said the arrest was preplanned and not related to the Islamic State group or the conflict in Syria. Mounting concern over the possibility of an extremist attack in Britain has led to increased airport security and increased checks of passengers on incoming flights from the Middle East. AP

Car bomb strikes Baghdad market, killing at least 8 BAGHDAD—Iraqi officials say a car bombing in a mostly Shiite neighborhood in Baghdad has killed at least eight people. A police officer said on Thursday the explosives-laden car was parked near an outdoor fruit and vegetable market. He said six civilians and two policemen were killed, while at least 15 other people were wounded. No one immediately claimed the attack, but it bore the hallmarks of the Islamic State group, which has carried out a string of bombings in the Iraqi capital over the past week, killing nearly 100 people. AP

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

Trump’s deportation vow spurs California farmers into action

RESNO, California—Days after Donald J. Trump won the White House vowing to deport millions of people in the country illegally and fortify the Mexican border, California farmer Kevin Herman ordered nearly $600,000 in new equipment, cutting the number of workers he’ll need starting with the next harvest. Herman, who grows figs, persimmons and almonds in the nation’s most productive farming state, said Trump’s comments pushed him to make the purchase, larger than he would have otherwise. “No doubt about it,” Herman said. “I probably wouldn’t have spent as much or bought as much machinery as I did.” Others in California’s farming industry say Trump’s tough campaign talk targeting immigrants in the country illegally—including a vast number of farmworkers— spurred them into action, too. They’re calling on congressional representatives to educate the incoming president on the workforce it takes to feed the country, and they’re assuring workers they’ll protect them. San Joaquin Valley farmer Joe del Bosque recently gathered about 20 year-round employees at a Los Banos steakhouse for their annual holiday lunch. The festivities began in a serious tone. The topic of immigration took a bigger part of the conversation this year because of Trump, he said. Del Bosque told his crew he’ ll make sure the new administration knows their v ita l role in the far ming industr y. It’s a message Del Bosque wants his managers to spread to another 300 seasona l workers needed at the har vest’s pea k. Leticia Alfaro, a food-safety supervisor at the farm, said in an interview that many of her friends who work in the fields don’t have proper documentation like her, and they take Trump’s threats seriously.

85% The percentage of farmworkers in California who live in the US illegally

“They’re terrified by his comments,” Alfaro, 53, said in Spanish. They fear being deported and torn from their children who were born here, she said. After Trump takes office, they wonder if it will be safe to make a simple trip to the grocery store, fearing checkpoints where they’ll be pulled over and have to show their documentation. Tr ump’s remarks were felt sharply in California, which produces nearly half the country’s fruits, vegetables and nuts valued of $47 billion annually. Experts say his words resonate nationwide. Texas, Florida and Georgia are examples of states with large migrant communities dominating home construction, health care, food service industries, said David Zonderman, a labor historian at North Carolina State University. “California might be ground zero,” he said of immigrant families living in the shadows. “But it’s not a unique California issue.” The fear stems from Trump’s campaign rallies, where he received a rousing response each time he vowed to deport people who are in the countr y i l legally—up to 11 million. That position softened after Trump

Farmer Kevin Herman stands next to an almond sweeper at his ranch near Madera, California. Herman says Donald J. Trump’s campaign vow to deport millions of immigrants who are in the country illegally pushed him into buying more equipment, cutting the number of workers he’ll need during the next harvest. AP/Scott Smith

won the election, when he said he’d start with 3 million with criminal records. Some farmers point to Trump’s postelection shift as a sign his campaign bluster won’t become reality. He is, after all, a businessman like them, they say. But others believe this shift underscores the president-elect’s unpredictable nature. “Our workers are scared,” said Joe Garcia, a farm labor contractor who hires up to 4,000 people each year to pick grapes from Napa to Bakersfield and along the Central Coast. “If they’re concerned, we’re concerned.” Since Election Day, Garcia’s crews throughout the state have been asking what will happen to them when Trump takes office. Farmers also are calling to see if they’ll need to pay more to attract people to prune the vines, he said. Garcia tells farmers not to panic. They’ll learn how many return from Mexico after the holidays. “We’ll plan around what we have,” he tells them. “That’s all we can do.” Roughly 325,000 workers in California do the back-breaking jobs that farmers say nobody else will do, according to the US Bureau of Labor Statistics. Manuel Cunha Jr., president of the Nisei Farmers League farming association, estimates 85 percent of California farmworkers live in the United States illegally. Farmers for years have scrambled under a shrinking labor pool. Mexico’s improving economy has slowed the flow of migrant

workers. The dangerous border, controlled by drug cartels and human traffickers, keeps away ot hers. Her m a n, t he fa r mer who bought three new almond sweepers, said Trump influenced him on top of California’s rising minimum wage and a new law giving farm laborers overtime rights that are equal to workers in other industries. Plus, Herman said, he’s heard too many workers question whether they’ll return from their holiday trips to Mexico. “It’s stories like that that have motivated me to become efficient and upgrade my equipment,” Herman said. Tom Nassif, a Trump adviser and president of the powerful trade association Western Growers, said farmers shouldn’t fear the president-elect. Trump isn’t interested in deporting their workers, he said. Nassif said he isn’t privy to the details of Trump’s immigration policy. He’s recommended that Trump allow farmworkers to stay by putting immigrants in the country illegally who are otherwise law-abiding residents on a period of probation under conditions that they pay taxes, learn English and obey all laws. “I think he’s looking at people who have committed more serious crimes and start with them first—and rightly so,” said Nassif, picked by Trump’s campaign team to serve on an agriculture advisory committee. “I think there’s less reason to worry than most people believe there is.” AP

UN exec: Optimism in east Aleppo as guns are silent

NITED NATIONS—A senior UN humanitarian official working in the Syrian city of Aleppo said on Wednesday that combat damage in the former rebel-held eastern districts is enormous but there is a sense of optimism because the guns have fallen silent—at least for now. Sajjad Malik, humanitarian coordinator in the city that was once Syria’s business hub, told UN correspondents by audio link that people in Aleppo have put their hopes in the peace process that brought the cease-fire under which rebels gave up the city’s eastern areas last month after weeks of battering by troops loyal to President Bashar al-Assad. So many previous cease-fires have failed, he said, “ but this time somehow they feel that maybe the international community will stick around and maybe they will be able to reclaim their lives and livelihoods.” Malik said the UN got into eastern Aleppo on New Year’s Day and since then 106 staff members have been going in and out trying to meet the needs of people who survived almost six years of conflict. “Nothing prepared us for what we saw inside there,” Malik said.

“The destruction is at a level that is hard to imagine.” But one encouraging thing was that amid the rubble, children were coming out to play and people were starting to talk about reclaiming their lives, he said. “The immediate and urgent need s a re enor mous,” Ma l i k said, including cleaning up huge amounts of rubble, addressing concer ns about families that have been separated, and getting youngsters traumatized by war back to school for the first time in more than five years. “W hat we’re doing is just the beginning,” he stressed, adding that the UN has asked for reinforcements to cope with the urgent needs. “Aleppo’s reconstruction is going to take a much longer time and way more resources than we have right now,” Malik said. “Even in the medium term we’re going to need more resources.” He said the UN could now operate in all but one district of eastern Aleppo where explosives are being cleared. Some 20,000 people are receiving hot meals twice a day and 40,000 are getting freshbaked bread, and there are also seven mobile clinics and 12 mobile

This undated handout photo released by the Russian Defense Ministry claims to show a Russian Military engineer distributing juice to local children in Aleppo, Syria. Russian Defense Ministry Press Service photo via AP

teams visiting east Aleppo every day, he said. Malik said of the 116,000 recently displaced people from east Aleppo, roughly 80,000 went to the government-controlled western part of the city and 36,000 went to rebel-held Idlib, some under the

cease-fire deal brokered by Russia and Turkey. Malik said he couldn’t estimate the population in east Aleppo but he said there are about 1.5 million people in the city as a whole, including 400,000 internally displaced people who came to western

Aleppo and have been supported by the UN and its partners in recent years. Some 4 million people lived in the city before Syria’s civil war erupted in 2011, with various rebel groups fighting to oust Assad and his government. AP

South Korean lawmakers accuse president of violating Consti

EOUL, South Korea—South Korean lawmakers on Thursday accused President Park Geun-hye of “broadly and gravely” violating the Constitution as the country’s Constitutional Court began hearing oral arguments in her impeachment trial. The allegations were made as Park ’s law yers and lawmakers, who ser ve as prosecutors in the trial, traded pointed arguments over accusations she colluded with a confidante to extort money and favors from c o mp a n ie s a nd a l l o w e d t he friend to unlawfully interfere with government affairs. The chief prosecutor in the trial, lawmaker Kweon Seongdong, said Park abused her position by “ broadly and gravely” violating the Constitution to commit cor r uption and tur n state affairs into a profit tool for her friend. He said she had to be kicked out of the presidency to repair the damage she had caused to the country’s democracy. A f ter Pa rk was impeac hed in t he Nat iona l A ssembly l ast mont h, t he Const it ut iona l Cou r t has si x mont hs to de cide if she shou ld per manent ly step dow n or be reinst ated. If Park is for ma l ly removed f rom of f ice, a n elect ion has to hold w it h in 60 d ays. Pa rk ’s l aw yer, L ee Joonghwan, said the accusations stated in the impeachment bill “ lack evidence and fail to make legal sense” because they were based on allegations and media reports, not criminal convictions. The hearing proceeded without Park, who refused to testify for the second time following her no-show on Tuesday. The ninejustice court cannot force Park to appear. The court had planned to hear testimony from four of Park ’s former and current aides suspected of helping Park ’s jailed friend, Choi Soon-sil, but only one appeared. T he court was not able to del iver subpoenas to for mer aides Ahn Bong-geun and Lee Jae-man, who both worked with Park for nearly 20 years since her days as a law maker, and Lee Yeong-seon, a current aide, asked to appear at another date, the court said. Park has publicly apologized for putting trust in Choi, but denied accusations by state prosecutors that she colluded with her friend in criminal activities. P rose c utor s a l so i nd ic te d Choi ’s niece and several former gover nment and presidentia l officials who allegedly assisted Choi in manipulating state affairs and exploiting her connections w ith Park to amass illicit fortune. Park ’s law yers may prefer her not to testify because their chief argument is that the accusations against Park have not been fully proven, said Han Sang-hie, a law professor at Seoul’s Konkuk University. Pa rk re jec ted request s by state prosecutors to question her and has yet to be questioned by the special prosecution team that has taken over the inquiry. During Thursday’s hearings, Seo Seok-gu, another Park lawyer, argued that the investigation into Park was biased and suggested that the massive protests that pushed lawmakers to impeach her were influenced by groups sympathetic to North Korea. Seo accused news organizations that reported on the scandal of demagoguery that he said threatened to make democracy “very dangerous,” and compared Park ’s impeachment to the “unjust ” deat hs of Jesus C hr ist and ancient Greek philosopher Socrates. AP

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Taiwan protests deportation of fraud suspects to Beijing

aiwan has protested to Vietnam after the country deported four Taiwanese accused of fraud to its rival, China, alleging that this was done under pressure from Beijing. Scores of Taiwanese have been arrested around the world in the past year in connection with vast telecoms-fraud scams targeting Chinese. Countries, including Malaysia, Cambodia and Kenya, have recently deported Taiwanese suspects to China, in deference to Beijing’s claim to sovereignty over the self-governing island. Taiwan has vigorously protested the deportations, saying it should be allowed to prosecute its own citizens. But it lacks diplomatic relations with many of the countries, which have close diplomatic and economic ties to Beijing. The Taiwanese Ministry of Foreign Affairs said this week it “regretted” that the Vietnamese government violated the principle of governments exercising their jurisdiction over their overseas nationals. The ministry said mainland officials obstructed Taiwanese attempts to look into the case and visit its citizens, and despite several meetings, Vietnam “forcibly sent the suspects to the Chinese mainland under intense pressure.” Beijing contends that Taiwan gives light treatment to the suspects, who are accused of extorting hundreds of Chinese by posing as bank or government officials. Chinese authorities say they should try the cases because their citizens are the primary victims and have been swindled out of millions of dollars. China has upped pressure on Taiwanese President Tsai Ing-wen in recent months, suspending contacts with her administration and waging a diplomatic campaign to further isolate Taiwan after she refused to endorse Beijing’s claim that Taiwan and the mainland are part of a single Chinese nation. AP

Editor: Max V. de Leon • Friday, January 6, 2017 A9

Singapore to deliver new growth map with economy under strain

ingapore is due to deliver a blueprint outlining strategies to boost the economy, as the export-dependent nation seeks new growth engines. The Committee on the Future Economy (CFE) will publish its recommendations in a few weeks time, Prime Minister Lee Hsien Loong said in his New Year message, days before the government reported that growth slumped to a seven-year low in 2016. Southeast Asia’s only developed economy faces risks, including rising trade protectionism in the US and a slowdown in China. Here is an outline of the committee and what to expect: What is the CFE? The 30-member CFE was set up in December 2015 to develop economic strategies for the city-state, along the lines of earlier groups convened since at least 1985. Comprising government and private-sector representatives, such recommendations have helped shape Singapore’s economic policies. The committee has the weighting of senior officials: it’s led by Finance Minister Heng Swee Keat and Minister for Trade and Industry S. Iswaran. Chan Chun Sing, minister in the Prime Minister’s Office who is a rising political star in the government, is the vice chairman. The CFE has consulted with more than 1,000 educators, business leaders and academics, The Straits Times reported. It seeks to identify growth industries and markets, as well

Historically, when Singapore convened these kinds of committees [as the CFE], they are not for show. This will set the tone for policy-making over the next period.”—Nomura Holdings as ways to make Singapore-based companies more competitive. Job creation, urban development and infrastructure are also part of its remit. Why is it important? Singapore has a history of success with similar committees in helping to drive economic change. Recommendations from the previous group —known as the Economic Strategies Committee—released in 2010, were mainly followed. These included raising fees companies must pay to hire foreign workers, a measure designed

Fireworks explode above Singapore’s financial district at the stroke of midnight to mark the New Year’s celebrations on Sunday in Singapore. AP

to curtail immigration growth, and setting up a National Productivity Fund to finance programs to boost productivity. “Historically, when Singapore convened these kinds of committees they are not for show,” said Brian Tan, a Singapore-based economist with Nomura Holdings Inc. “This will set the tone for policy-making over the next period.” What to expect? The CFE is likely to focus on financial technology and nanotechnology, as well as ways to improve productivity with the working population set to decrease in coming years, said Song Seng Wun, a

regional economist at CIMB Private Bank in Singapore. “Singapore must find a few tricks up its sleeve to make sure it remains relevant,” Song said. “The question is how Singapore, a small open economy, can stay relevant when social media and other developments have made businesses almost borderless. Singapore is not that limited by its small size anymore.” Singapore is no stranger to innovation. In the 1990s, it shifted its focus to chemicals, electronics, engineering and developed biomedical sciences. In 2015 the biomedical industry had an output of S$26.9 billion ($18.6 billion), about 10 percent of overall

manufacturing production. What about jobs? Employment may feature more prominently in the committee’s recommendations at a time when the city-state is shedding jobs at the fastest pace since 2009. In particular, there is expected to be a focus on initiatives for the retraining of older workers, Nomura’s Tan said. “There is growing evidence that structural unemployment is rising in Singapore because some careers may not be so viable anymore,” Tan said. “It’s an issue of how you redeploy the workers into the new sectors that the CFE is going to come up with.” Bloomberg News

JPMorgan lashing by Indonesia signals global threat to analysts Things seen

he world is getting more hazardous for skeptical analysts, the banks that employ them and investors who rely on their published research. Even by the rough-and-tumble standards of emerging markets, Indonesia’s punishment of JPMorgan Chase & Co. this week for a bearish analysis of the nation’s stock market stands out. The country’s finance ministry cut business ties with America’s biggest bank, telling reporters on Tuesday that the firm’s November research note wasn’t “accurate or credible.” Official attempts to deter such research are nothing new in developing economies, but rarely do governments retaliate against a Wall Street powerhouse for publishing opinions that contradict official views. The move builds on a trend: Last July Turkey’s banking regulator issued an industry-wide warning to avoid negative reports. In 2014 Brazil President Dilma Rousseff chastised an analyst for suggesting her election would hurt the economy. “It’s definitely been getting more aggressive recently,” said Paul McNamara, a London-based emerging-markets fund manager at GAM Ltd., which oversees client assets of about $65 billion. As money managers around the world pull capital from developing economies on concerns over rising US interest rates and a stronger dollar, policy-makers are becoming especially sensitive to critical analyst opinions, according to Medley Global Advisors. The risk for Indonesian authorities is that their actions backfire by undermining investor confidence in the country’s market research. “Published research is already a diluted view, but these kinds of actions will make it even more bland,” McNamara said. “Retail investors will have no idea what analysts are really thinking because the written reports won’t say anything real.” JPMorgan downgraded Indonesia’s equity market by two notches to underweight from overweight in a November 13 report, calling it a “tactical response” to Donald J. Trump’s election win. The bank also cut its rating on Brazil, while noting that both

40%

The share of overseas investors in Indonesia’s government debts as of last September

countries may provide a “better buying opportunity” later. Indonesia’s finance ministry said on Tuesday it will stop using JPMorgan as a primary dealer and as an underwriter of its sovereign bonds. While Finance Minister Sri Mulyani Indrawati said the government is open to improvement and respects the assessments of research providers, she said banks should take responsibility for economic reports that “could influence fundamentals and psychology.” “The finance ministry and the government are very open to criticism, but JPMorgan’s research result was pretty weird and unfair,” Sofjan Wanandi, head of the experts team at the vice president’s office, said in an interview on Wednesday. JPMorgan’s business in Indonesia continues to operate as normal, the bank said in an e-mailed statement on Tuesday. “The impact on our clients is minimal and we continue to work with the Ministry of Finance to resolve the matter,” the bank said. On Wednesday the finance ministry clarified that it won’t stop JPMorgan from conducting private-sector business in the country.

Turkey’s warning

Government retaliation for negative research can have a chilling effect on market analysis. Some investment banks in Turkey scaled back commentary on sensitive political subjects after the banking regulator warned brokerages last July against publishing “reports that would turn expectations and the atmosphere negative.”

That same month, the head of research at one of Turkey’s largest brokerages was stripped of his professional license and charged criminally over a report analyzing the impact of a failed July 15 coup targeting President Recep Tayyip Erdogan. The criminal charge was later dropped, but an investigation started by the capital markets regulator is still ongoing. An official for the Ankara-based market regulator SPK, who asked not to be named citing the institution’s policy, declined to comment on the investigation.

Analysts afraid

IN 2014 Rousseff publicly shamed an analyst at Banco Santander Brasil SA for forecasting a deterioration in the country’s currency and stock markets if she were reelected. The firm later said it fired the analyst, disowning the remarks as that person’s opinion, not necessarily reflecting the company’s view. The episode spooked other analysts, according to Klaus Spielkamp, head of fixed-income sales at Bulltick Llc. “If anybody had anything bad to say about Brazil at the time, they wouldn’t say it,” he said. “Everybody was afraid.” Rousseff’s campaign press office declined to comment at the time, as did the nation’s banking association, Febraban. Rousseff was replaced as president last year after being impeached for breaking budget laws. Other governments’ moves also have stoked concerns among research analysts. China’s crackdown on hedge funds and broker-dealers for alleged trading abuses during its 2015 stock-market rout was seen by some as targeting negative financial views. And in Italy prosecutors accused Fitch in 2012 of mismanaging its analysis of the euro-zone debt crisis. The firm disputed the claim, and the case against it was later dismissed.

Capital outflows

While governments usually go after negative research during political or economic turbulence at home, the biggest concern for emerging markets today is capital outflows tied to the prospect of faster interest-rate

increases under a Trump presidency. International investors pulled $23 billion from developing-nation funds from the start of October through mid-December, according to the Institute of International Finance. “Governments are sensitive to criticism, especially in countries where there are large capital inflows that can quickly turn into outflows and prompt a currency sell-off,” said Nigel Rendell, London-based senior analyst at Medley Global Advisors. Yet, even the most developed market isn’t immune to concerns that free speech is being stifled. S&P Global Ratings initially claimed that the US government’s 2013 lawsuit against the firm for allegedly inflating ratings on subprime-mortgage bonds was in retaliation for S&P’s downgrade of America’s sovereign credit rating. The firm dropped that accusation when settling the government’s case in 2015, acknowledging in a statement of facts that it hadn’t found evidence to support the claim. The company didn’t admit wrongdoing in agreeing to pay $1.375 billion to federal and state authorities.

Changing landscape

For Andre Spicer, a professor at the Cass Business School at City University in London, the increased willingness of governments to challenge big banks, like JPMorgan, reflects the industry’s diminished reputation in the wake of the global financial crisis. “In the past, large investment banks were masters of the universe,” Spicer said. “Now, nation-states are flexing their muscles.” Still, Indonesia relies on international securities firms to market its sovereign bonds to overseas investors, who accounted for about 40 percent of local government debt holdings as of last September, according to the Asian Development Bank. If policy-makers were to alienate more banks with similar spats, they might undermine the government’s ability to finance its spending plans. “JPMorgan has been in the country for a very long time,” said Christopher Wheeler, an analyst at Atlantic Equities in London. “It will blow over them, but probably do more harm to Indonesia.” Bloomberg News

getting worse for Malaysian ringgit

alaysia’s ringgit, one of Asia’s worstperforming currencies over the past year, has further to fall, according to BMI Research. One reason is because it is affected by the yuan, which is going to remain under downward pressure, BMI said in a January 4 note. There will also likely be a narrowing of real interest-rate differentials between the US and Malaysia, with the latter probably staying on hold this year while the Federal Reserve (the Fed) increases rates by a total of 50 basis points. Further weakness in the global bond market would also put the ringgit under pressure given that around 40 percent of Malaysian bonds are held by foreigners. BMI has lowered its forecast for the ringgit. It expects it to average 4.50 per US dollar this year and 4.40 in 2018, from 4.00 and 3.88 previously. The currency, which fell 4.3 percent against the greenback last year and 18.5 percent in 2015, hasn’t posted an annual gain since 2012. “The Chinese economy remains mired in a medium-term slowdown as the structural weaknesses, such as overcapacity in the industrial sector and dominance of inefficient state-owned enterprises, persist,” the note said. “Given that China is Malaysia’s largest export partner, we believe that Malaysia’s export-driven economy remains exposed and is likely to be negatively impacted.” The ringgit is, however, likely to claw back some losses over the longer term, supported by the rising price of commodities, such as oil, and improving terms of trade, which will be positive for domestic savings and investment, BMI said. Malaysia’s relatively positive fiscal position relative to the US should also keep inflationary pressure subdued, it said. The risks to BMI’s view are to the downside. If the Fed increases rates faster than expected it could lead to higher outflows from Malaysia and put the ringgit under greater pressure. Donald J. Trump’s presidency also raises the likelihood of a global trade slowdown, while Malaysia’s export sector would suffer if additional protectionist measures are imposed, it said. Bloomberg News

A10 Friday, January 6, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

An open letter to US Ambassador Sung Kim

elcome to the Philippines, Mr. Ambassador. From your recent trips to both Davao and Baguio, you have seen the near-extremes of Philippine latitudes and cultures. It is not too many generations past that the people of those areas would have had equally extreme difficulty in communicating with one another. Or sharing cuisines, for that matter. Even Filipinos sometimes have difficulty understanding how this widely diverse group of people could have ever united under one roof and one flag. We try the best we can. Actually it is probably American colonization that most helped to form this country into a nation. But, then again, even during that period we were of mixed opinion about what our future course should be. By now you have probably been here long enough to experience our Filipino hospitality. You may have already been asked “How many siblings do you have?” “What is your favorite Filipino food?” and “How much money do you make?” In the West these questions might border on a too familiar rudeness. But here, it is our way of showing our genuine interest in a visitor. As with the United States, we have always had somewhat of a love/hate relationship with its ambassadors. Amb. Kristie A. Kenney became a local celebrity. But then leaked cables revealed her less than favorable comments about former President Cory Aquino. As in most families, members are allowed to criticize each other; outsiders are not. Amb. Harry K. Thomas Jr. lit a firestorm by saying that 40 percent of male foreigners come to the Philippines for sex without any data to support that claim. But, then again, Mr. Thomas met, fell in love with, and subsequently married a Filipina, so most all is forgiven. Back in May 2016, when it was first announced that you were to be US ambassador to the Philippines, we at the BusinessMirror publicly welcomed your appointment. We wrote, “Now we suddenly get a US representative who has worked closely with the Chinese and has experience in both political and military diplomacy.” Three of the last six US ambassadors came to the Philippines from posts in Bangladesh, Slovenia and Ecuador—not exactly hot spots of US foreign-policy focus. US ambassadors have often been viewed as potential “spies” or appointed to the Philippines while awaiting a position to an important country. While the Philippines often looks, sounds and walks like a Western nation, we are Asians, an integral part of Asia, and we should be viewed that way. With your heritage and cultural roots being in Asia, you probably understand that fact better than any previous US representative to the Philippines. Your long professional experience in East Asia and with China, in particular, may bring a new and welcomed US perspective about the Philippines to each other’s benefit. Former US Ambassador Philip S. Goldberg came to the Philippines carrying controversial baggage from his position in Bolivia and left under the same type of cloud. He seemed more interested in public relations than being a substantive representative. We wrote in May that “it may be likely that the days of the US Embassy’s ‘1-Earth Clean-up and Concert’ and ‘The Great American BBQ’ are over.” We may have been a bit hasty. American barbecue should probably always be a part of US diplomacy. Please remember us when the invitations to the next feast are sent out. Mabuhay, Mr. Ambassador. Since 2005

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atas Pambansa Bilang 881 is a codification of all the election laws that existed prior to its passage in 1985; hence its short title, the Omnibus Election Code or OEC. Since then, a number of other laws have either amended or repealed parts of the OEC, including Republic Act (RA) 8189—which established a continuing system of registration—and RA 8436—also known as the automation law. Of course, we don’t refer to RA 8436 anymore since that has been superseded as well, via RA 9369. These two laws worked the most sweeping changes in the OEC and together reshaped the face of Philippine elections. RA 8189, for instance, did away with the practice of conducting voter registration only for a fixed period immediately prior to an electoral exercise (this is why people still refer to registration as being “for” a particular election,

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rather than as a continuing affair, regardless of whether elections are coming up or not). RA 8436, on the other hand, authorized the Commission on Elections (Comelec) to use modern election technology, i.e., automation, moving the country away from tedious manual counting and consolidation of results. However, as far ranging as these

changes have been, much of the OEC remains largely as it was written in 1985—more than three decades ago. And this presents a problem. Many of the provisions of the OEC were based on considerations, such as technology and the then purchasing power of the Philippine peso. In other words, the law was very much the product of its times. The times have changed, however, and many of the old assumptions no longer hold true. In part, it was to keep up with the times that many of the new electoral laws were passed. Unfortunately, even these new laws have been fairly narrow in scope, amending only specific portions of the OEC, while leaving the rest of it untouched. Take RA 8436, for example. It allowed for the automation of elections but it prohibited electronic transmission and it preserved the old step-wise canvassing procedure of manual elections. In effect, the changes simply superimposed modern technology on an archaic system without making thoroughly sure that

his week is that part of the year where most people make resolutions, try to lose the excess weight after all those holiday parties and, perhaps, reflect on the past year. A few days ago I was fortunate to be part of a Holy Land pilgrimage, together with my parents, siblings, and some nephews and nieces. Since 1998, my father has sponsored family reunions every two years to allow his children and grandchildren from the Philippines and the US to reunite and reconnect. Our visit to Jordan, Israel and Egypt last December 2016 was our 10th reunion. Personally, the holiday break gave me quality time to reunite, reflect and, most important, reconnect with people who I love and love me back. In a recent “reunion” of some sorts with former colleagues from the Bureau of Immigration last December, we all agreed to give something to each other which we think represents ourselves to others. As a gift, I gave them a 2-in-1 pocket power bank gadget with a built-in flashlight. I told them that such gadget somehow represented who I am to them as I tried to provide “light” to guide them and show them the road less traveled in times of darkness and tried to give them “energy” in times of frustration and disillusion. At the same time, I said that the 2-in-1 gadget served to remind them of my dual role in their lives—that I am both a mentor and a tormentor, a friend and a co-

worker, and a boss and a father to all of them. During that same evening, my coworker then in the bureau and now with Philippine Airlines, Maria Angelica Pedro-Tayag, more known as Maan, gave me an angel statuette with a very touching message that said: “An angel for you is what I will try to be. Your best interests, I will always see. Happiness of heart is my wish for you. The gift of family, so warm and true…” Indeed, she and the rest of my close colleagues in the bureau and current coworkers in PAL will be “family” to me as much as the Mison family is. Reflecting on the past year, 2016 gave me enough perspective to appreciate the little things that matter

—family, friends and freedom. Being in a less stressful position in the private sector gave me the freedom and the opportunity to spend more time with my octogenarian parents, to read more inspirational books, the Bible especially, to engage in more sports and hobbies (golf, bike, dive, yoga), to sleep more quality hours and, most important, to reflect and pray more quality minutes. The many trials and adversities I faced both personally and professionally last year definitely made me a better person today. Considering that “the dark moments in my life will last only so long as is necessary for God to accomplish His purpose in me,” I will always act without fear but with comfort in the fact that He has my back! And my recent trip to the Holy Land reinforced this conviction, as the journey got me reconnected with the Lord. Never underestimate the power of reconnections. True friends will always be there despite time and distance. Angels disguised as friends may also surprise you. As I looked at the gifts and greetings sent my way last December, I am flattered by some who I have lost touch after oh so many years. I appreciated the fact that some sent cards, little gifts and even a template video message via Facebook or Viber to somehow, some way, get me reconnected with them, in the same way I got reconnected with Him through simple gestures of friends and strangers. Often

everything fit perfectly. To put it even more simply, the approach to updating the OEC has been one of forcing square pegs into round holes. With enough brute force, it’ll fit, sure; but it ain’t gonna be pretty. So, perhaps, it is time to do things differently. The chairman of the Comelec has expressed the desire to see the OEC amended during the first quarter of 2017. Without commenting on the optimism implicit in such a timetable, there can be no disputing the need for such a push. After three elections under an automated elections system, with the purchasing power of the peso drastically different from what it was 32 years ago, and with a rapidly growing Filipino brain trust in various related disciplines, Philippine elections are ripe for a system-wide upgrade. Let’s hope Congress takes up the call. James Arthur B. Jimenez is director of the Commission on Elections’s Education and Information Department.

neglected and usually forgotten by most people during their busiest days, our Lord will always be there for us. As I walked and followed the footsteps of the Holy Family from Bethlehem, Nazareth, Jerusalem and other holy sites, I was reminded that our Lord patiently waits for those who come to Him, regardless. During Christmas Eve, since our tour group did not have a priest to officiate a Catholic mass, one group of Singaporean pilgrims generously invited and warmly welcomed us to their Mass service in Shepherds Field. They were literally strangers to us but who were practically angels sent our way to make our Christmas celebration more meaningful. In his book, Love is a Verb, Gary Chapman said that as we enter a new year, we cannot cling to the security of the past or the present. Chapman said that we have to move forward to an insecure future knowing that “the One who loves us best will be there with us every step of the way.” In his homily, the priest from Singapore during that Christmas Eve Mass in a chilly Bethlehem afternoon reminded the congregation that Christmas season gives all of us time to celebrate many things. Reunions. Reflections. Reconnections. He added that these things are all about having hope, joy, love and peace. And if I may add, faith. For questions and comments, e-mail me at sbmison@gmail.com

Opinion BusinessMirror

opinion@businessmirror.com.ph

Assessing the new administration’s first six months Randy Tuaño

EAGLE WATCH

S we begin to open the year 2017, it seems to be an appropriate time to evaluate the performance of the Duterte administration in terms of economic and social dimensions. After all, the new President stated during the electoral campaign in the middle of 2016 that he would be able to solve many problems in the country, “[including] drugs, criminality and corruption in three to six months” after his election, according to an interview with a foreign press agency. Therefore, it would be good to briefly take stock of government actions and also to assess the challenges that need to be undertaken in this year. At the level of broad macroeconomic indicators, the country continues to enjoy the economic progress that has benefited many Filipinos in the past few years. In the third quarter of 2016, according to national income account data, the economy grew by 7.1 percent in GDP terms, which is almost similar to the 7-percent growth in the same quarter in 2015. Unemployment continues to decline at 4.7 percent of the labor force last October, compared to 5.6 percent in the same month the previous year, even if underemployment slightly increased to 18 percent. Inflation has stayed below 3 percent, even if there has been a recent surge in oil prices during the past few weeks. The self-rated poverty and hunger indices of the Social Weather Stations, which has been monitoring welfare for the past three decades, has declined to record lows, which is a continuation of trends since 2014. In terms of the eight-point agenda unveiled by the administration in its first few days, there is very little concrete progress so far as many of the items necessitate institutional of more medium- and long-term policy changes. But while the President’s “free hand” given to the government’s economic managers seem to “provide enough leeway to craft a high economic-growth path” (see Businessmirror, December 28, 2016, http://www.businessmirror.com.ph/free-hand-given-by-duterte-to-govt-economistsseen-boosting-growth), it might also show the lack of focus on the necessities of development, beyond criminality and drug issues. These agenda points include the following: n Continuation of macroeconomic policies and undertake reforms in revenue collection. The government has released a package of tax reforms, including restructuring of the personal income-tax system, expanding the value-added tax, adjusting excise taxes on petroleum products and restructuring the excise tax on vehicles. However, the recent approval by the House of Representatives postponing the implementation of single tax rates of cigarettes may derail reform moves to increase public revenue. n Accelerating infrastructure spending. Fiscal data estimates show that infrastructure spending will increase to 5.1 percent to 5.2 percent of GDP this year and 5.3 percent to 5.4 percent of GDP next year, up from 4.3 percent in GDP in 2016. A policy of multiyear infrastructure spending would help. But the challenge would be to ensure there is sufficient human resources that would enable the targets to be met. n Ensure attractiveness of the Philippines to foreign investments by also improving security and reducing criminality. Bangko Sentral data on foreign direct investments for the July-to-September 2016 period show a significant drop in 2016 compared to that of 2015. However, this may be due also to a “wait-and-see” attitude of many foreign investors, especially as a new investments priorities plan is being developed. On the other hand, while Philippine National Police data show a decrease in “index” crimes (including crimes against persons and property) in the July-to-September 2016 period, the number of murders have soared by 50 percent. There have been discussions in Congress on instituting constitutional

reforms to improve entry of foreign capital, but, unfortunately, the debate has focused mostly on a specific type of change in government structure, which may not necessarily be the appropriate response at present to a very centralized administration. n Provide support services to small farmers to increase productivity. Recently, the government announced a significant increase in financing to small farmers, while Congress has approved a 10-percent increase in the government agency focused on irrigation. Attention has also been given to agricultural products other than rice. However, the government’s propensity for putting up specialized banks (see BusinessMirror, December 20, 2016, http://www.businessmirror.com. ph/landbank-to-set-up-ofw-bankby-september-2017) may be using resources from government financial institutions and limit the amount of resources necessary for rural development to flourish. n Address bottlenecks in land administration. There have been very few pronouncements on improvements in land governance. n Strengthen basic education system and provide scholarships. The current administration has chosen to keep the K to 12 reforms implemented by the previous government. However, the reforms in tertiary education may be threatened with the implementation of a free-tuition program which financing is not clear beyond this year. n Expand the implementation of the Conditional Cash-Transfer Program. The 4 million Pantawid Pamilyang Pilipino Program beneficiaries will receive rice subsidies next year as part of the government’s efforts to strengthen the program. However, efforts to improve the education component of the program to ensure continuous schooling of children of beneficiary-families need to be undertaken. Beyond progress on the agenda, there are several political and social challenges, which also threaten the broad economic gains. The rise in extrajudicial deaths in the country have prompted issues on the human-rights front, and these have implications on foreign resources. During the past month, we have learned that a new round of grant funding from the US government, which has supported infrastructure and poverty alleviation efforts in the past four years, has been suspended. The filing of a bill on the death penalty has put in peril the tariff free entry of most Philippine commodities to the European Union under the so-called General System of Preferences that the country has enjoyed since 2014. There are also fears that the implied change in foreign policy may put into peril the business-process outsourcing industry, in which the basis of the growth of our middle class in the past decade or so. All of these necessitate a stronger attention that the President and Congress should make to ensure that solid foundations for sustained growth should be in place. While many Filipinos continue to remain hopeful and optimistic about the country’s progress this year, the country faces some peril of a “singleissue” administration.

Tuaño is an associate chairman of Department of Economics.

Friday, January 6, 2017 A11

When darkness is real Tito Genova Valiente

annotations

ateline: Naga, A city in darkness. It has been 13 days since Typhoon Nina battered this city and robbed its population of Christmas. On the 24th of December last year the anticipation was not for the Midnight Mass but about the time the storm would hit the place. By the next morning, the chill in the air was not coming from the wind but from the fear of the people: the storm had achieved a superlative status. Trees were toppled in many towns of the province. The electric supply was cut and the entire Camarines Sur was (I am tempted to say “blanketed” but that would make things cozy) covered in darkness. On the 26th I hired a cab and went up and down (isn’t that the common movement for anyone frantically looking for comfort?) the city in search of a room in a hotel. I found it charming how my travails were taking the form of the magical journey of the Messiah whose arrival this time got stalled because of a supertyphoon. There was no place at the inn. Typhoons can bring inhospitality. I needed a place to charge my mobile

phone and broadband and laptop. These devices, by late afternoon had become a burden. But I had a deadline to beat and I am imagining the medium-wrath from my editor. In the café of a downtown hotel, the tables were occupied by people nursing their coffee and common anxieties. When someone stood up, crowd swooped (this time I will resort to a cliché), like vultures to find out if there is a hole somewhere to plug their devices. But, as they received the information that, “No, I am not leaving yet,” the crowd (let me mix my dear metaphors) retreated like ghostly vultures seeing the crucifix of denial. Do you feel the horror in the images I create?

The city—maybe, I am exaggerating—or at least those in search of electricity to charge all forms of technological connections were on the verge of nervous breakdown. “My phone is dying!” was the chorus of the Denied. It was scary how the loss of electricity can form human groups poised, it seems, to kill each other over connections. And, I do not mean social or political connections. The scene in that café was scary. Suddenly life and its rules of decency got finally correlated to devices, like laptops and mobile phones. I thought of an alternative. Yes, human societies became civilized because of alternatives. The cheapest hotel room, available at 3 p.m., became unavailable at 5 p.m. The guests felt the brownout was like a heartache that would last for more than three days. The room, I was informed, cost P2,500. Then and there I decided to travel to

Manila. The bus cost P2,000 roundtrip. It would leave me with 500 pesos, more than enough for coffee when the bus would stop at Tiaong McDonald’s and taxi fare to my apartment in Quezon City. At the bus station, the crowd looked nervous but full of positive energies. I rushed to the counter and the guy announced there was an open ticket in one bus. It was for a single seat. Cocooned inside the bus, I texted my editor till what time I could submit my column? Till 10 a.m. I slept the sleep of the good journalist ready to die for a deadline. When I woke up, we were in Tiaong. It was 7 a.m., a full four hours away from Manila. I arrived at 11 a.m. in the city. I missed the deadline. Darkness is indeed real. E-mail: titovaliente@yahoo.com.

There is hope for all those victimized by drugs Rev. Fr. Antonio Cecilio T. Pascual

SERVANT LEADER

N light of the alarming current social situation in the country, the Archdiocese of Manila, Caritas Manila and Fazenda da Esperança will celebrate a “Day of Hope” for the Filipino people, especially for all those victimized by drugs, on Sunday, January 8, 2017, at the Manila Cathedral. Gracing the event is His Eminence Archbishop of Manila Luis Antonio Cardinal Tagle, DD, who will also lead the Holy Mass at 10 a.m. The Founders of Fazenda da Esperança from Brazil, including Rev. Fr. Hans Stapel, will also attend the event, as well as the rehabilitated and reformed drug dependents from Fazenda who have been living good and respectable lives after their program. They will give testimonies to tell the country

that there is life and hope even after drugs. This partnership between the Archdiocese of Manila through Caritas Manila and Fazenda de Esperança strengthens the drug-rehabilitation and -restoration initiatives of the Catholic Church in the country to help thousands of drug surrenderees resulting from the government’s intense campaign against illegal drugs. Fazenda da Esperança, or The

CSC clarification MAIL

Please e-mail your letters to the editor to oped@businessmirror. com.ph. Letters chosen for publication in this section are edited for brevity and clarity. This refers to the article “Groups hit Civil Service official for pushing ban on ecigarettes” by Claudeth Mocon-Ciriaco published on print and online versions of the BusinessMirror on November 21, 2016. As a response to the said article and to enlighten the public on the issue, a joint statement has been prepared by the Civil Service Commission (CSC) and the Department of Health (DOH) for widest dissemination. Below is the text of the joint statement: Joint statement by the Civil Service Commission and the Department of Health The following statement clarifies the issues raised in various publications, including the Business Mirror, relative to the participation of the CSC Chairperson during the World Health Organization’s Seventh Conference of Parties for the Framework ConventiononTobacco Control(FCTC) held in India last November 7-12.

1. The Philippines participated in COP, which is being conducted every two years, as one of the parties to the FCTC. The FCTC is the first treaty negotiated under the auspices of the World Health Organization, created in response to the tobacco epidemic. It was opened for signature on 16 June to 22 June 2003 in Geneva, and thereafter at the United Nations Headquarters in New York, the Depositary of the treaty, from 30 June 2003 to 29 June 2004. The treaty, which is now closed for signature, has 168 Signatories and 180 parties, including the Philippines. The Philippines ratified the FCTC on February 22, 2005, through the Senate Committee Report No. 12, which approved the P.S. Resolution No. 195 or the ‘Resolution Concurring in the Ratification of the Framework Convention on Tobacco Control.’ Having been ratified by the government, the FCTC is considered as part of the law of the land. It is the country’s obligation to comply to the treaty and ensure that utmost priority is given to public health over other interests. 2. While the Vaping Industry claims that the Electronic Nicotine Delivery System (ENDS) is less harmful than tobacco products, the Department of Health (DOH) believes that all ENDS product should be regulated. DOH Administrative Order No. 2014-0008 asserts the stance of WHO that the potential risks which ENDS pose for the health of users remain undetermined. WHO stated that “until such time as a given ENDS is deemed safe and effective and of acceptable quality by a competent national regulatory body, consumers should be strongly advised not to use elec-

Farm of Hope, is a therapeutic community with over 30 years of experience in the recovery of drug addicts all over the world. Here, recovery is based on its three pillars: Community—coexistence in the family; work—as a pedagogical process; and, most of all, spirituality—to find a sense of life and love. Founded in Brazil by Fr. Hans Stapel, Nelson Giovanelli, Luci Rosendo and Iraci Leite, the Farm of Hope has grown to a total of 120 farms scattered in 18 countries around the world. Fazenda da Esperança has been in the Philippines for 13 years now and has recovered over a hundred Filipinos already. They have been giving new life to so many drug addicts, believing that as long as there is life, there is hope. Caritas Manila, the social development arm of the Archdiocese of Manila, runs the Restorative Justice Prison Ministry intended to the development of the prisoners and the correctional community based on the principles of Restorative Justice (RJ).

tronic nicotine delivery systems including e- cigarettes.” The ENDS products and its manufacturers and distributors are being regulated by the FDA to ensure protection of the safety and welfare of consumers. Under the said policy, ENDS or e-cigarettes are not exempted from ‘clean air laws’, which restrict the places in which cigarette smoking is allowed. The Philippines, during the COP, supported the proposal of the FCTC Bureau which invites parties to ‘consider applying regulatory measures such as those referred to in document FCTC/COP/7/11 to prohibit or restrict the manufacture, importation distribution, presentation, sale and use of ENDS/ENNDS, as appropriate to their national laws and public health objectives’ 3. The CSC has been at the forefront of the government’s tobacco control agenda. It is the head of the National Tobacco Control Committee on Article 5.3 (NTCC 5.3), which is the steering committee of FCTC Article 5.3. The said article ensures the proper creation and implementation of tobacco control laws and policies, which should be in compliance with the FCTC. The NTCC 5.3 is one of the sub-committees under the National Tobacco Control Committee headed by the DOH. The CSC currently implements two tobacco control policies. In 2009, CSC issued Memorandum Circular No. 17 on Smoking Prohibition Based on 100% Smoke-free Environment Policy. It orders an absolute smoking ban in all government premises that provide health, education, and social welfare and development services. In 2010, the CSC and the Department of Health jointly issued a directive which banned all

The program conducts (Pa-Release-Me): paralegal assistance, religious studies (bible study, catechesis), livelihood training, education, advocacy, services for social action and medical assistance. Also, in October 2016, Caritas Manila launched Sanlakbay, a Church drug-rehabilitation and -restoration program that strengthens the preventive phase of the Restorative Justice Ministry in partnership with the Masa masid in the community. The program intends to help thousands of drug surrenderees by providing values formation, counseling, sports and cultural and livelihood programs toward healing, rehabilitation and restoration.

To know more about Caritas Manila, visit www. caritasmanila.org.ph. For your donations, please call our DonorCare lines 563-9311, 564-0205, 0999-7943455, 0905-4285001 and 0929-8343857. Make it a habit to listen to Radio Veritas 846 in the AM band, or through live streaming at www.veritas846.ph. For comments, e-mail veritas846pr@ gmail.com.

government officials and employees from interacting with the tobacco industry, unless when strictly necessary for effective regulation, supervision or control. In the absence of DOH Secretary Paulyn Ubial, who had another commitment during the COP, the CSC Chairperson was identified by the Department of Foreign Affairs (DFA) as the head of delegation, being the next official in rank. The Head of the Delegation is not necessarily a subject expert but the highest ranking official in the country delegation who can articulate the position and politically correct stance in identifying local experience and best practices on the topic or subject matter at hand. Philippines’ statement during the COP were agreed upon by the members of the Philippine Delegation and cleared by Secretary of Health. Further, during the COP, the Head of the Delegation also sought guidance from the Secretary of DOH on matters that require Philippines’ support to draft decisions being presented by the FCTC Bureau. (Sgd.) Alicia Dela Rosa-Bala Chairman Civil Service Commission (Sgd.) Dr. Paulyn Jean B. Rosell-Ubial Secretary, Department of Health

We hope that this statement will be given ample space in your publication as you continue to uphold the values of fairness and accuracy in news reporting. Maria Luisa Salonga-Agamata Public Assistance and Information Office Civil Service Commission

2nd Front Page BusinessMirror

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Friday, January 6, 2017

Higher VAT on ‘sin’ products eyed; excise tax on petroleum opposed

By Jovee Marie N. dela Cruz

@joveemarie

ollowing the approval of a measure imposing two-tier tax rate for tobacco products at the House of Representatives, a member of the House Committee on Ways and Means on Thursday said he plans to file a bill further increasing the value-added tax (VAT) on liquor products.

Party-list Rep. Jericho Jonas B. Nograles of Puwersa ng Bayaning Atleta asked the Department of Finance (DOF) and the Department of Budget and Management (DBM) to look at the prospect of further increasing the VAT on so-called sin products than imposing higher excise tax on diesel and other fuel products, which will adversely affect the survival of the country’s poor. The imposition of excise tax on petroleum, removal of VAT exemptions for senior citizens and person with disabilities, and ad valorem tax on automobiles are among the offsetting measures being pushed by the DOF, but opposed by lawmakers, to cover up for the foregone revenues from the proposal lowering personal income-tax rates. The tax-reform package involves foregone revenues of around P200 billion but, at the same time, will generate around P566 billion for the government. “For one, t he gover nment should see the full implementation of the sin-tax law, and possibly amend it further to increase government revenues. Creating a special law to further increase the VAT on liquor and other sin products is a better option than imposing higher tax on diesel,” Nograles said. Last month the House of Representatives has approved on third and final reading House Bill 4144, imposing two-tier tax rate for tobacco products. The measure, which seeks to amend RA 10351, or the Sin Tax Reform Act, will be transmitted to the Senate for its own deliberation. Under the sin-tax law, unitary tax of P30 will be imposed per ciga-

₧6 The proposed excise tax per liter on diesel fuel and other petroleum products having more or less the same generating power

rette pack starting January 2017, regardless of the net retail price. However, the proposed two-tier tax system seeks to impose P32 tax per pack on tobacco products at or lower than P11.50 per pack, and a higher P36 tax per pack for products exceeding the said amount.

No to diesel excise-tax hike

According to Nograles, imposing higher excise tax on diesel would greatly diminish the purchasing power of Filipino consumers, because this would mean higher transport cost and dramatic increase in prices of goods, including basic commodities. “Increasing its [diesel] cost could run counter to President Duterte’s social-reform agenda,” he said. “This can have inflationary effects on our economy. Our jeepneys, buses, farm implements, cargo trucks and haulers, and even some of our power plants run on diesel. Imposing a higher excise tax on

STEEL TRADER SUES TRADE EXECS FOR RED TAPE, GRAFT A

businessman has filed criminal compl a i nts before t he Office of the Ombudsman against two officials of the Department of Trade and Industry (DTI) for violations of Republic Act (RA) 9485, or the Anti-Red Tape Law; and RA 3019, or the Antigraft and Corrupt Practices Act. Compl a inant L aw rence Daniel Sy, president of Mannage Resources Trading Corp. (MRTC), accused DTI Region 3 Director Judith Angeles and DTI-Bureau of Product Standards Assistant Director Marimiel D. Porciuncula of discriminatory conduct, after the

two recalled the Final Import Commodity Clearance (Final ICC) issued on his company’s shipment of imported steel last December 8, just nine days after it was issued. The trader said the actions of the two DTI officials caused undue delay to his business, as well as damage to the reputation of his company, being a new player in the industry, after news of the ICC recall was published in the news. Sy sought i nd ict ments against the two officials for alleged v iolations of Sections 3 (a), (e) and (f) of RA 3019 for acting with manifest See “Steel traders,” A2

www.businessmirror.com.ph

Senators nix Diokno proposal on oil tax RECTO: “There is no fiscal crisis. The timing is also bad now that oil prices are on their way up.”

By Butch Fernandez @butchfBM

Motorists fill up at a gas station in Manila. If the Department of Finance will maintain its first proposal, excise tax will be imposed on petroleum products, including leaded premium gasoline, per liter of volume capacity, P10 (from P5.35); and unleaded premium gasoline, per liter of volume capacity, P10 (from P4.35). Bloomberg News

diesel will mean increased cost in operating these vehicles and facilities. Obviously, all added costs will be passed on to our consumers,” said Nograles, who is also the caretaker congressman of the First District of Sulu. Nograles said imposing a higher excise tax on diesel is not the right way to go if the government wants to raise revenues that are badly needed to finance the government’s infrastructure spending and other programs that are designed to fight poverty. “This is like punching someone on the ground, and then helping him get on his feet to treat him to a free meal. To me, that doesn’t make a lot of sense,” Nograles said. He also said the price of diesel in the Philippines is still very high, compared to other Asian countries. “Our economic managers should continue to remain faithful to the commitments of President Duterte. The President wants a better life for all Filipinos, especially the poor, and that’s the track that we should take,” Nograles said.

Excise-tax proposals

Meanwhile, if the DOF will maintain its first proposal, excise tax will be imposed on petroleum products, including: ■ Lubricating oils and greases, including, but not limited to, base

stock for lube oils and greases, high-vacuum distillates, aromatic extracts and other similar preparations, and additives for lubricating oils and greases, whether such additives are petroleum based or not, per liter and kilogram, respectively, of volume capacity or weight, P10 (from P4.50); ■ Processed gas, per liter of volume capacity, P6 (from P0.05); ■ Waxes and petrolatum, per kilogram, P10 (from P3.50); ■ Denatured alcohol to be used for motive power, per liter of volume capacity, P6 (from P0.05): ■ Naphtha, regular gasoline and other similar products of distillation, per liter of volume capacity, P10 (from P4.35). ■ Leaded premium gasoline, per liter of volume capacity, P10 (from P5.35); unleaded premium gasoline, per liter of volume capacity, P10 (from P4.35); ■ Aviation turbo jet fuel, per liter of volume capacity, P10 (from P3.67); ■ Kerosene, per liter of volume capacity, P6 (from P0.00); ■ Diesel fuel oil, and on similar fuel oils having more or less the same generating power, per liter of volume capacity, P6 (from P0.00); ■ Liquefied petroleum gas, per liter, P6 (from P0.00); ■ Asphalts, per kilogram, P6

(from P0.56); and ■ Bunker fuel oil, and on similar fuel oils having more or less the same generating power, per liter of volume capacity, P6 (from P0). For his part, House Committee on Ways and Means Chairman and PDP-Laban Rep. Dakila Carlo E. Cua of Quirino said he is set to file the revised version of the comprehensive tax package, which was drafted by the DOF, before the session resumes on January 16. Cua also said only workers with a monthly salary of P20,833, or P250,000 annually, will be exempted from personal income tax (PIT) under the new DOF proposal. This runs against proposals of Duterte and other lawmakers, who want the DOF to exempt workers earning P25,000 monthly, or P300,000 annually, and below from PIT. In the current setup, those earning P10,000 or less per month pay a 5-percent income tax, while those with yearly earnings of P500,000 and above pay a 32-percent income tax The lawmaker also admitted that the DOF maintained its proposal removing the VAT exemptions for senior citizens and person with disablities (PWDs). “This is not final yet, we can still change it,” said Cua, who refused to give further details of the new bill.

Bautista: I’m not responsible for Comelec voters’ data leak By Joel R. San Juan

@jrsanjuan1573

OMMISSION on Elections (Comelec) Chairman Andres D. Bautista has questioned the findings of the National Privacy Commission (NPC), which held him solely responsible for the hacking and defacing of the poll body’s web site in March last year. In a news statement released on Thursday, Bautista questioned why he is being pinpointed as being the lone official that can be held “criminally liable” for the leak of millions of voters’ data. In its 35-page decision dated December 28 but made public only on Thursday, the NPC found the Comelec as having violated Sections 11, 20 and 21 of the Data Privacy Act, when it failed to protect the privacy of the voters’ data in its role as “personal information controller”.

BAUTISTA: “Unlike the NPC, which is run by IT practitioners, the Comelec en banc is currently managed by seven lawyers. Hence, we rely on our IT department for expert advice on web site/data security and privacy, and ITrelated matters.”

The NPC also recommended the criminal prosecution of Bautista due to his “willful and intentional disregard of his duties as head of agency,” which is tantamount to gross negligence”. “While data privacy and security are important topics that need to be taken seriously, these are matters that are best left to informationtechnology (IT) experts. Unlike the NPC, which is run by IT practitio-

ners, the Comelec en banc is currently managed by seven lawyers. Hence, we rely on our IT department for expert advice on web site/data security and privacy, and IT-related matters,” Bautista said. Bautista insisted that, as head of the Comelec, he generally trusted the advice and recommendation of the poll body’s IT experts, since he has no expertise on the matter. “And if the Comelec IT specialists directly in charge of operating the web site were found not to be liable, what more those who merely oversee their work and, in particular, the head of agency?” he stressed. Bautista added that he should not be solely blamed on the breach, since the Comelec is a collegial body. In particular, the poll chief said he should not be blamed over his supposed failure to appoint a data See “Bautista,” A2

pposition is gaining ground in the Senate against the Duterte administration’s drastic plan to raise taxes on fuel products to offset projected foregone revenues from the proposed lowering of personal and corporate income-tax rates to fulfill one of the President’s campaign promises. Senators voiced serious concerns over the moves earlier announced by Budget Secretary Benjamin E. Diokno to enforce a “comprehensive” tax-reform package to bankroll government projects by imposing, among others, higher tax on soft drinks, as well as fuel tax on diesel fuel by at least P6 per liter, to generate P60 billion in additional revenue. Among others, lawmakers are worried over the backlash likely to hit daily commuters and traders who will be made to pay higher fares, given that public conveyances—jeepneys, buses, taxis and trucks that ferry goods to the markets—mostly run on diesel fuel. Senate Minority Leader Ralph G. Recto led the mounting opposition to the taxhike plan, citing its “bad timing”. “I am against it,” Recto told Senate reporters. “There is no fiscal crisis. The timing is also bad now that oil prices are on their way up.” Recto, a former director general of the National Economic and Development Authority, recommended that instead of raising fuel taxes, the Duterte administration should “just improve collection efficiency and stop smuggling”. He noted, in addition, that since the government is able to “collect more taxes when the economy grows faster, then grow the economy”. The senator suggested that the Duterte administration should “spend the budget first” before imposing higher taxes. Sen. Francis C. Escudero, who chairs the Senate Committee on Banks and Financial Institutions, assured that the Senate will closely scrutinize the administration’s controversial revenue-raising scheme aimed at imposing additional tax on all fuel products. “We will study their proposal but, offhand, that [P6 per liter] seems too much. Also, they [administration proponents] would first have to show and prove that “they have exhausted all efforts to collect existing taxes.” Moreover, Escudero explained that the Duterte administration “can actually spend that money, especially given our experience last year.” He also rejected Diokno’s justification that downward adjustments in income and corporate taxes will offset the impact of additional tax on fuel products. Escudero asserted the increase in fuel taxes “will far outweigh the net effect of lowering of income-tax rates.” For his part, Senate Majority Leader Vicente C. Sotto III suggested that lawmakers “first look at other sources of revenue before imposing additional burden on the public.” “Further study in the Senate is necessary,” Sotto said, adding: “Meron kaming mga economic experts and members with a lot of common sense, therefore, the issues can be fully discussed.” According to Diokno, the comprehensive tax-reform package envisioned by the Duterte administration will also adjust personal and corporate income-tax rates to “make them more competitive”. He indicated that the tax package will also cover adjustments in the value-added tax, among other revenue-raising schemes. However, Sen. Panfilo M. Lacson Sr. indicated he may support the plan, “as long as there is a mechanism to cushion the impact to public transport and other freight-related industries. Lacson added: “I am inclined to support the tax-package program of the DOF and the administration. Having said that, I need to see how they will put that mechanism in place, and find out if it is effective or at least implementable.” Lacson clarified that “public transport and freight services use diesel fuel. I don’t care about the diesel-fed SUVs, since the affluent sector who are using the same can afford higher diesel prices.”