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Monday, January 15, 2018 Vol. 13 No. 96

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EFARMING and reallocating radio frequencies for mobile technology is a “serious matter” that requires “careful attention,” PLDT Inc. Chairman Manuel V. Pangilinan said, adding that the telecommunications company (telco) is “actively and thoroughly” utilizing its current portfolio of spectra.

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PLDT chief urges caution on frequency allocation By Lorenz S. Marasigan

2016 ejap journalism awards

Do we suffer from ‘bureauphobia’?

140

Alberto C. Agra

ead

PPPC.LAgra Alberto

Pangilinan said he wants to assure the government that PLDT is making good use of the frequencies it secured from the acquisition of the telco assets of San Miguel

n order for public-private partnership (PPP) arrangements to happen, there must be private sector proponents (PSPs) who are willing to deal with the government through its implementing agencies (IAs). IAs must, likewise, be open to partnering with PSPs. If a PSP is bureaucracy-risk-averse, is not willing to face political risks or suffers from “bureauphobia,” as described by Dr. Ichak Adizes in his January 3 blog, then, obviously, there could be no PPPs. Relatedly, IAs must acknowledge that there are gaps and believe that there are benefits in partnering with outsiders or PSPs.

See “PLDT,” A2

Continued on A15

The megahertz frequency remaining for a third player entering the Philippine telecommunications, sector, as the majority are held by PLDT Inc. and Globe Telecom Inc.

DUTERTE TO ISSUE ‘MOTHER BMReports OF ALL EXECUTIVE ORDERS’ TO GOVERN BORACAY DEVT Shopping mall fire: When will we ever learn? By Manuel T. Cayon @awimailbox Mindanao Bureau Chief

Part One

D President Duterte is expected to issue soon a new executive order that would govern the development of Boracay Island, addressing issues on overbuilding of commercial establishments, inadequate infrastructure and illegal logging. The Philippine Chamber of Commerce and Industry-Boracay has been pushing for a tourism authority to be created to oversee the island. Stella Arnaldo By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

HE mother of all executive orders (EO) to govern the development of Boracay will be issued soon by President Duterte. This developed as the Department of Tourism (DOT) projected arrivals in the world-renowned resort island in Aklan would reach P2.2 million in 2018. Tourism Secretary Wanda Corazon T. Teo and Environment Secretary Roy A. Cimatu disclosed that they would recommend a new EO for President Duterte to sign, during their visit last week to Boracay, which consistently ranks among the most popular beaches or islands in the world. “The focus of the EO will resolve

the issues pertinent to Boracay,” said Cimatu, who noted that a number of EOs have already previously been issued but were never fully implemented or followed. One of these was EO 706 issued by former President Gloria Macapagal-Arroyo on January 18, 2008, which directed the tourism secretary as chairman of the then-Philippine Tourism Authority (PTA) to take control over Boracay, and ordered the mayor of Malay to “suspend the issuance of building permits for any structure on Boracay Island unless approved by the chairman of the PTA and the governor of Aklan as Chairman of the Aklan Provincial Tourism Development Task Force.” The PTA is the forerunner of the Tourism Infrastructure and Enterprise Zone Continued on A16

PESO exchange rates n US 50.3780

AVAO CITY—Christmastime wasn’t the only thing in the air last December 23. It was two days before Christmas, and vehicles crawled on roads at the southern part of the city, where one of the most frequented shopping malls was supposed to open one hour earlier to accommodate the holiday rush. Up in the sky billowed black smoke, a throbbing funnel-shaped emission jutting to the sky from the left side of the New City Commercial Center (NCCC) shopping mall. It was about 9:30 in the morning. Handheld devices chirped left and right from pedestrians and rubberneckers on Ma-a Road. Initial messages noted there was a fire in the mall, but where it was raging was anybody’s guess. Later on, messages showed how the fire spread. Some shoppers from uptown detoured to the San Rafael Bridge hoping to avoid getting entangled in the traffic jam building up and still get to the mall before the expected shopping rush at late morning reach its peak. Along the way, though, motorists would be greeted by another face of disaster that occurred a night earlier: the impact of a storm. Residents along the riverside slept on pavements, their furniture, appliances, chairs and tables, draped

The collapsed portion of the NCCC Mall, ravaged by a fire last December 23, is shown in this photo. Killed during the fire were about 38 people, 37 of whom were employees of the American firm Research Now Survey Sampling International, at the fourth floor of the shopping center in Davao City. MANUEL CAYON

with wet clothing, leaning beside warehouses and shuttered stores. Some other residents appeared to have just emerged from their homes when the flood subsided. Near the riverbanks, a long blanket of mud indicated a worse nightmare for residents, with water marks in houses and posts showing how high floodwater reached: above houses with a

second floor. These people were mute survivors of the wrath of Typhoon Vinta ( international code name Tembin), one of the last typhoons to hit the country but which made another queer landfall at the eastern Mindanao, swathing inland. But, as early-morning shoppers would soon realize, the shopping mall fire has turned more serious

than just being dismissed as one of those simple fires in big businesses that get easily put out. Reaching the main highways, they were soon to be waived by police, who have set up road blocks going to the NCCC Mall. The smoke billowing out from the shopping center had more

n japan 0.4530 n UK 68.2017 n HK 6.4401 n CHINA 7.7531 n singapore 37.8982 n australia 39.7432 n EU 60.6198 n SAUDI arabia 13.4334

Continued on A2

Source: BSP (12 January 2018 )

A2 Monday, January 15, 2018

BMReports BusinessMirror

Shopping mall fire: When will we ever learn? Continued from A1

volume and has become blacker.

We thought it was manageable

MANY of the more than 300 call-center agents, staff and their supervisors that time at the US digital research company Survey Sampling International (SSI) thought the fire inside the mall was manageable. It took some more minutes before the SSI agents would notice something sinister at the third floor of the mall was already creeping toward them at the fourth floor. “To my right I noticed some white smoke came out from the AC [air-conditioner],” Sheila, 21, said. She said she was at that time sitting on her cubicle with fellow staff grouped in a team of about 60 to 70 agents. The team was called a “wire.” Sheila, who requested anonymity, said in a blink of an eye, the smoke that came out the AC became black. Something that SSI employee Bai Maylen Latip, 22, also noticed. She began panicking. I felt panic from the other wires because they were running to and from anywhere the sound-proofed working area, Sheila added. Latip told the BusinessMirror she didn’t notice the panic “because I panicked too.” “I also asked out loud what should we

do and what was happening,” she said. “In my mind, I was already thinking I would be dead soon.” But Sheila said she was able to keep her cool, the way she had been in many instances. “I think the fire is manageable,” she said aloud.

Smoke from exits

THINKING the fire was manageable may have been the reason many of SSI agents and workers sought refuge at the narrow lockers and the rest room, and not the fire exit. “When someone opened the fire exit, thick black smoke came out at us,” Sheila said. “Someone shouted to try to go the elevator.” We were relieved the elevator was still running, according to Latip. To our horror, the same thick black smoke came out, she added. A hallway connected the employees’ working area to where their lockers are located. To get to and fro, they would pass by a lobby. No one thought of the lobby, Sheila said, probably because the space was commonly used as a holding area for SSI applicants. The lobby, however, was shut off from the mall’s winding stair case with a thick glass. “We were just like being tossed back and forth,” she said. Many soon went to the lockers and the

rest room because these were one of the remaining spaces the smoke hasn’t reached.

Zero visibility

NO one knew who was in charge. “I just followed what the guy ahead of me was saying, relying on him that he was repeating what the others leading them were also saying,” Sheila said. But Latip said she would not know if someone was really leading them or not. “I clung close to the shoulder of the next guy in front of me, tight enough to seek comfort and assurance,” she said. “There was zero visibility.” Latip could not describe how the smoke was or the heat. “I just kept on shouting every now and then,” she said adding she used her jacket to cover her face. Sheila said the smoke smelled “terrible, not the smoke that we experience when we cook rice using wood.” She used a shawl she retrieved from her locker to cover her face and eyes. The emergency lamps had been popping out with the heat. Each pop would be followed by shouting all around as it got darker. Soon, Sheila found herself climbing down a stair, onto the ground floor and outside. “That’s when I really felt that I was safe,” she said.

Trapped

LATIP, Sheila and the other workers who were able to get out from their office at the fourth floor of the NCCC mall crossed the street. They looked up and saw the mall spewing smoke from every hole it tried to escaped from: open windows, viaducts, etc. It has yet to dawn on them they were the few survivors. “We were there outside, refreshing our thoughts of what we’ve been through, not knowing that there were still some of our friends there trapped,” Sheila said. Latip said it was only a few minutes later that they realized some were yet to come out; “when the head counts began.” That time was not a hectic day for the company, and some wires were either on their day off or were not in full force. Survivors said there were about six or seven teams that were on duty that time, or between 360 to 420 persons at the SSI work station. From her hometown on her day off in Panabo City, Efrel Ann Miras, 19, got wind of the incident shortly after the SSI chat group began the chatter on the fire. “It feels horrible later in the day when the accounting of those who might have been up there began to filter in,” Miras said. “I felt like I want to be there to help.” It was impossible. Mira is on a place separated by a 32-kilometers road congested by vehicles. To be continued

Senate eyes Charter change that amends economic provisions Continued from A16

However, it is not just the transition to federalism that is fueling Cha-cha. In the view of Sen. Panfilo M. Lacson Sr., the consideration of Cha-cha could finally accommodate calls to amend the economic provisions, possibly including the caps on foreign ownership of business in certain industries, and of land. In a separate interview with DWIZ over the weekend, Lacson said the economic provisions alone could be changed by lifting the 40:60 restrictions on investments and ownership of land. “If you were to ask me, I’d rather we just change those provisions as they account for why we are laggards; we are the only ones where foreigners cannot own land, which they cannot bring out of the country anyway. Those who invested cannot take them to their own country,” Lacson said. The economic provisions of the Constitution also impose caps on ownership of utilities, media and advertising companies, among others. Lacson said the 1987 Constitution has been “too nationalistic to a fault,” but that was understandable because “we just emerged from a dictatorship” in 1986. But the world has become smaller and smaller.

We’re the only ones with no provisions for opening up to foreign investment; the investors would rather go to other countries.” For instance, the senator cited the case of China, which was inward looking during the time of Mao Zedong, but when Deng Xiaoping came on board, “they became progressive-minded; now they’re truly open.”

Drilon open to Charter change, but....

Earlier, Senate Minority Leader Franklin M. Drilon gave assurances he will not block Cha-cha, saying he is open to it. But Drilon clarified this will depend on how soon the Senate and the House will approve their respective versions of Charter amendments. Drilon’s partymate in the Liberal Party, Sen. Francis N. Pangilinan, has called for a hearing on Wednesday of the Senate committee on constitutional amendments, and revision of codes and laws, to tackle the Charter-change proposals. Both Drilon and Pangilinan have opposed notions, floated by some House members, that as a result of the shift to federalism, the Cha-cha transitory provisions could include the lifting of term limits on incumbents. The Senate minority is concerned this will pave the way for indefinite rule by the Duterte administration, in much the same way that then President Ferdinand E.

Marcos assumed the powers of the Executive and the Legislative as dictator without term limits. Lacson said while the House is tackling a separate proposal, the Pangilinan committee will first tackle the resolution filed by Drilon for a constitutional convention to amend the 1987 Charter. The Minority believes that while convening an elected con-con will be more expensive, it is a much better way of picking those who will craft the amendments, and will keep out of the process incumbents who may have vested interests to cling to power. Lacson added: “As of now, there is no resolution yet to call for a constituent assembly [Con-ass],” one of the three modes provided by the Constitution for introducing amendments. He expects Senate President Aquilino L. Pimentel III to file a separate resolution for the two chambers to convene in joint session, but specifying that they must vote separately. Meanwhile, besides Cha-cha, lawmakers’ agenda are filled with the next wave of tax reforms even as various quarters are still debating the real impact on most Filipinos of the Duterte administration’s Package 1 of the Tax Reform for Acceleration and Inclusion (TRAIN), enacted into law last December. The Senate Ways and Means Committee,

chaired by Sen. Juan Edgardo M. Angara, was earlier reported in the BusinessMirror as setting a tight deadline for itself in tackling at least three tax amnesty bills that are part of the next-wave measures. “The committee is finalizing the tax amnesty bill for reporting out within the first two weeks of sessions,” Angara told BusinessMirror on January 7. Following Angara’s self-imposed target, the tax amnesty measure should be ready at committee level by end-January, since sessions resume on Monday. According to Angara, his committee will tackle in consolidated fashion not just his own bill (Senate Bill 942) but also one by Senate President Pro Tempore Ralph G. Recto (SB 920) and by Sen. Paolo Benigno S. Aquino IV (SB 1494). SB 942, or the “Grant of tax amnesty act” was filed on August 1, 2016 by Angara, with Sen. Nancy S. Binay as coauthor. Its long title is: “An Act enhancing revenue administration and collection by granting an amnesty on all unpaid internal revenue taxes imposed by the national government for taxable year 2015 and prior years.” Congress has passed “two-thirds of the expected revenues from Package 1 of the TRAIN,” according to the Department of Finance (DOF). The remaining one-third involves provisions on the estate tax amnesty, a general tax amnesty, the proposed adjustments in the Motor Vehicle Users Charge, amendments to the bank secrecy law and automatic exchange of information, the DOF explained in a briefing statement. Package 2 aims to lower corporate income taxes and modernize fiscal incentives in a bid to complement the expected incremental revenues from the first package, according to the DOF. “We are going to submit to Congress Package 2 of the CTRP [Comprehensive Tax Reform Program] in January 2018,” Finance Secretary Carlos G. Dominguez III said earlier.

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PLDT. . .

Continued from A1

Miguel Corp. two years ago. “That’s a serious matter of public interest, [and the government must] give careful attention to it,” Pangilinan said. “As far as we are concerned we are using actively and extensively the frequencies we have acquired from San Miguel.” PLDT and rival Globe Telecom Inc. joined forces to acquire Vega Telecom Inc. from the Ramon S. Ang-led conglomerate San Miguel in 2016. Such a transaction—prized at about P70 billion—resulted in the two telcos increasing their portfolios of frequencies. Data from the National Telecommunications Commission showed that existing telcos hold majority of the said assets to date. PLDT holds 400 megahertz (MHz) of the total holdings, while Globe has rights to 325 MHz. What remains for budding telecom players is a mere 140 MHz of frequencies in the 700 MHz, 850 MHz, 2100 MHz, 2500 MHz and 3500 MHz spectra. Spectrum is the real estate on which telecommunication operators develop their respective network to deliver services to customers. The amount of spectrum assigned to a telco has an impact on the cost, the build capacity, overall network performance, ability to offer new multimedia services and general customer experience of wireless services. Talks on the possible refarming and redistribution of the frequencies have been going on since 2016. The issue then found itself in the limelight after President Duterte announced the potential entry of China Telecom as a new telco player. Experts argue that the remaining swathe of frequencies is not enough for a new player to compete with the existing vendors. Duterte has said that the Chinese telco should come in by the first quarter of 2018. As to the method and means of its entry still remain a mystery for the existing players and experts. Foreign companies are, by law, allowed to own up to 40 percent of company in the Philippines. Budding telco players are also required to secure a congressional franchise before they start operating in the country. Pangilinan noted that his group “respects” the President’s call for a new player in the duopolistic telco market. “We’ve always said we’d welcome a third player,” he said. “All we can do at this stage is to prepare for that, but our main job is to build a superior network for fixed and wireless to be sure that the service is world class.” This, he said, is his group’s commitment to Duterte, citing his company’s planned capital expenditures (capex) of more than P50 billion for 2018. “We said that we will show that with the level of capex north of P50 billion to demonstrate that we are getting serious about our wireless and fixed networks,” Pangilinan said. Bulk of the capital outlays will be used to intensify its network’s capacity and coverage. This includes the setting up of new base stations and the expansion of its fiber-optic cable systems. Although experts describe the telco market as duopolistic, Pangilinan said the sector is actually highly competitive. “Competition is intense, I don’t think its abated,” he said. He admitted, though, that the price wars have toned down. “There’s less competition in the price aspect,” PangIlinan said. Experts and government officials have long pushed for the entry of new players in the telco market, as this would force the existing vendors to provide better and more affordable mobile services to their customers.

BNPP can be rehabbed, experts say Continued from A16

Some options being considered include converting the facility into a data center, tourist attraction, among others. “I have to find a closure to this project because all of us are paying for the cost,” Cusi said. The government has spent P50 million annually for maintenance costs since 2007, on top of yearly losses amounting to around P12 million. On the proposed nuclear policy, which will undergo public consultation, Cusi said the country may consider putting up a floating nuclear facility. “The policy is for nuclear, not necessarily BNPP. We are looking at a floating nuclear or a maritime nuclear. When I went to Russia, this will be ready in early -2019. We can bring it in the country and that is around 60 MW,” Cusi said. For this, the private sector would have to pitch in. “The DOE is not builder of infrastructures, but more of policy directions for the country. So, if the policy on nuclear is a go, we are still not permitted to purchase that. Under Epira, it will

be the private sector. We are just paving the way to make it happen,” Cusi explained. The nuclear policy, he added, would be finalized soon. The BNPP is the country’s first and only attempt at nuclear-power development. It was supposed to be the first of two nuclear plants to be built in the northern province of Bataan. It was also the first nuclear power plant in Southeast Asia, and was identified as a solution to the 1973 oil crisis that had adversely affected the global economy, including the Philippines. The $2.3-billion project, however, was mothballed in the wake of the Chernobyl disaster in 1986. But clamor for the reopening of the BNPP was revived during the power crisis in the 1990s and the skyrocketing oil prices in 2007. During these periods, the DOE actually came close to reconsidering nuclear power as a potential energy source for the country. But then the Fukushima nuclear-plant incident happened in 2011, creating global panic and concerns about the safety and integrity of nuclear plants.

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Editor: Vittorio V. Vitug • Monday, January 15, 2018 A3

D.O.E. donates 200 e-trikes for Marawi rehab

S Marawi City recovers from the ashes of a terrorist siege that lasted for five months, residents are slowly returning to the life they knew before the conflict began. The Department of Energy (DOE) and Task Force Bangon Marawi (TFBM) held a ceremonial signing of a memorandum of understanding (MOU) for the donation of 200 electric-powered tricycles (e-trikes) built using Japanese technology. The e-trikes are air and noise pollution-free, easily driven and can be charged using any 220-volt outlet, which can be found anywhere. The lightweight, one-piece shell of the e-trike is more rigid than conventional, externally attached side cabs of current gas-powered tricycles and are compliant with the Road Worthiness Guidelines of the Land Transportation Office (LTO). Each e-trike will seat five passengers and feature a passenger access on the side, which adds to the safety of the vehicle. Energy Secretary Alfonso G. Cusi led the signing of the MOU, turning over the e-trikes to TFBM chair-

man, Secretary Eduardo D. del Rosario of the Housing and Urban Development Coordinating Council, and Marawi City Mayor Majul Gandamra. “This donation will surely help Marawi City rise again, and is a tangible start for the government to show Marawi residents that we are really committed and sincere,” del Rosario said. Del Rosario added around 250 hectares of the city have been damaged by the conflict, but when the area is developed, it will become a modern commercial district. An eco-friendly central business district and tourist attraction is part of the development plan, which makes the e-trikes a perfect addition to the attraction, the government’s housing and urban development chief said. “These e-trikes represent a means to support livelihood and jump-start the increased economic activity in the area,” Cusi said. Cusi also gave the assurance that the DOE and the stakeholders in the Mindanao region are expediting the establishment of charging and service stations to increase the durability of the e-trikes. PNA

DOH wants Sanofi Pasteur to refund P1.4B for unused Dengvaxia vaccine

By Claudeth Mocon-Ciriaco | Correspondent

he Department of Health (DOH) has asked French pharmaceutical giant Sanofi Pasteur to refund the Philippine government P1.4 billion for the unused Dengvaxia vaccine, as it awaits results of the evaluation of the Philippine General Hospital (PGH) on alleged Dengvaxia immunization-related deaths. In a letter sent to Thomas Triomphe, head of Sanofi Pasteur Asia Pacific, the DOH laid down its refund demand for Sanofi, as it also sent another letter requesting Sanofi Pasteur to conduct serotest-

ing of the more than 830,000 vaccines using a newly developed test to determine their prevaccination status at no cost to the government. The DOH also requested all documents on the ongoing clinical

trials and other studies involving Dengvaxia in the Philippines, including proof that they have passed ethics review standards of the Philippine Council for Health Research and Development (PCHRD). Sanofi, on the other hand, said it acknowledged “the request made by the Department of Health (DOH) Francisco T. Duque III, for the reimbursement of unused doses of Dengvaxia.” “We have recently asked for a meeting with Secretary Duque to discuss this issue directly, which we hope can take place in the very near future,” it added. Duque said the DOH has yet to receive an official response from Sanofi Pasteur on the demand letters. “The Dengvaxia vaccine that Sanofi Pasteur aggressively promoted and sold to the Philippine government has undeniably failed to deliver its supposed clinical benefit and safety claims, hence,

the vaccine is considered defective under Philippine civil laws,” he added. The DOH has halted its dengue-vaccination program after Sanofi Pasteur released an advisory on Dengvaxia, which indicated potential risk to those who have not been exposed to dengue prior to immunization. “The risk benefit ratio of Dengvaxia has significantly changed as the risk caused by the introduction of the vaccine to seronegative people has greatly outweighed its benefits, if any,” Duque explained. Duque said that based on official data from the Epidemiology Bureau, four out of 17 deaths following immunization of Dengvaxia were found to have been due to dengue shock. Other deaths were among children who had other illnesses and comorbidities. “Based on the Dengvaxia Surveillance Update on January 10, 2018, from the Epidemiology Bureau, four of the 17 cases being looked into identify dengue shock as cause of death,” Duque said. The DOH also emphasized that there is no conclusion yet on whether the administration of Dengvaxia caused the death of the vaccinees. A panel of Philippine General Hospital independent experts is currently evaluating the clinical records of these cases. The DOH reiterated its earlier statement that it is willing to cooperate with ongoing investigations being conducted by the Department of Justice and the Public Attorney’s Office. “We welcome these investigations as complementary to our efforts at finding the truth about this matter,” Duque said. Meanwhile, the DOH, upon orders of the Supreme Court, is preparing its comment on the petition for mandamus urging the DOH and other government agencies to provide free medical services and treatment to vaccinees.

Supreme Court seen dismissing petition questioning TRAIN law By Jovee Marie N. dela Cruz @joveemarie

deputy speaker of the House of Representatives last Sunday made light of the petition filed at the Supreme Court (SC) challenging the approval process and implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law. Deputy Speaker Fredenil H. Castro of the Second District of Capiz said the petition filed by the Makabayan bloc against the implementation of TRAIN would be dismissed by the High Court. “The measure was approved. Roll call and quorum was declared, and the quorum is continuing until after it is declared inexistent,” Castro said in a radio interview. “There is always a presumption of regularity in the exercise of official function. Unless one can present contrary evidence. Then that will only be the time that the presumption of regularity in the performance of official function can be questioned,” Castro added. Last week the Makabayan bloc in the House of Representatives questioned before the SC the validity of the TRAIN law. Party-list Rep. Carlo Isagani T. Zarate of Bayan Muna said the lower chamber ratified the congressional bicameral conference committee report of the tax-reform package last December 13 even without the required quorum. But Castro said: “That’s a very flimsy excuse and a shallow reason. They have the burden of proof to show that there was no quorum at that point in time. The best evidence to prove whether there was a quorum was the roll-call result [on that day].” “They could not just run and shout and say there is no quorum. Let us consult the minutes of the proceedings and that will be determinative of whether or not there was quorum,” he added. Party-list Rep. Antonio L. Tinio of Act Teachers, a member of the Makabayan bloc, said he tried to question the ratification of the measure last December 13, but the deputy speaker and the deputy ma-

jority floor leader ignored him. Zarate and Tinio said the ratification of the tax measure is a violation of Rule 10 Section 63 of the rules of Congress as it did not go through the voting process. They cited Rule 10, Section 63 of the House on Conference Committee Reports, which states that: “xxx A conference committee report shall be ratified by a majority vote of the members of the House present, there being a quorum.” The government has started implementing the TRAIN law last January 1. For oil and petroleum, the law levied a tax of P3 for kerosene, P2.50 for diesel, P1 for liquefied petroleum gas while all petroleum products used as input, feedstock, raw materials for petrochem and refining or as replacement fuel are exempted. Meanwhile, it exempted workers earning P250,000 annually from paying personal-income tax. The law also imposed excise tax on coal: P50 per metric ton for the first year, P100 for the second and P150 for the third. Under the TRAIN law, the tax rate to be imposed on sugar-sweetened beverages is P6 per liter for juices and energy drinks, and P12 per liter for beverages with highfructose corn syrup. It said the excise tax rates for all nonmetallic minerals and quarry resources, and all metallic minerals, including copper, gold and chromite, will be doubled. For auto excise tax, a tax of 4 percent for vehicles up to P600,000; 10 percent for over P600,000 to P1 million; 20 percent for over P1 million up to P4 million; and 50 percent for over P4 million. The law also eased the rates of estate and donor’s taxes by imposing unitary tax rate of 6 percent. For tobacco excise tax, from current P30 to P32.50 effective January 1, 2018 to June 30, 2018; P35 effective July 1, 2018 to December 31, 2019; P37.50 effective 2020 to 2021; P40 effective 2022 to 2023 and a 4-percent annual increase after. It said cosmetic procedures, which include surgeries and body enhancement, will be taxed 5 percent.

Lawmakers need time to study proposed changes to 1987 Constitution, shift to federal form of government

ongress will not rush the passage of the proposed changes to the 1987 Constitution despite being a priority measure, a leader of the House of Representatives said Sunday. Deputy Speaker Fredenil H. Castro of the Second District of Capiz said lawmakers need time to study and draft the proposedCharterchanges,whichseektoshift the type of government to federalism. “There’s no instruction from the leadership to subcommittees of the House Committee on Constitutional Amendments to rush the proposal,” said Castro, one of the vice chairmen of the House Committee on Constitutional Amendments. “We are still discussing the changes. We don’t have the final proposed

changes to the Constitution...based on subcommittee level,” he added. Castro said legislators have yet to reconcile the draft Federal Constitution submitted by Partido ng Demokratikong Pilipino-Lakas ng Bayan (PDPLaban) Institute of Federalism with the House of Representatives’s proposed Federal Constitution. The House Committee on Constitutional Amendments’ four subcommittees are still consolidating ABS Rep. Eugene de Vera’s Resolution of Both Houses 8 and the proposed changes of the PDP-Laban Federalism Institute to create the draft of a proposed Philippine Federal Constitution. Subcommittee1chairedbyRep.Corazon N. Nuñez-Malanyaon of the First

District of Negros Oriental is handling the provisions on the Executive-Legislative (Articles VI and VII); New article on Federal and Regional Powers, Number of States; and Local Government and Taxation/Allocation of Resources (Article X). Subcommittee 2 chaired by Deputy Castro is drafting the provisions on the Judiciary (Article VIII); Amendments or Revisions (Article XVII); Suffrage (Article V), Citizenship (Article IV); and Bill of Rights (Article III). Subcommittee 3 chaired by Rep. Alfredo A. Benitez of the Third District of Negros Occidental is preparing the Preamble; National Territory (Article I); Declaration of Principles and State Policies (Article II); General Provisions (Article XVI); and

Transitory Provisions (Article XVIII). Last, Subcommittee 4 chaired by Rep. Vicente S.E. Veloso of the Third District of Leyte is handling Social Justice, Labor and Others (Article XIII); Education, Science and Others (Article XIV); National Economy and Patrimony (Article XII); New article on the Bill of Duties; Accountability of Public Officials (Article XI); and Family (Article XV). Earlier, Speaker Pantaleon D. Alvarez said convening Congress into a constituent assembly (Con-ass) to propose charter amendments and a shift to federalism is the top priority of the House of Representatives when session resumes on January 15. The lower chamber is expected to resume its discussion on the resolution calling

Congress to convene itself into Con-ass when it resumes session on Monday. Moreover, Alvarez said if the 17th Congress could convene into a Conass this January, the proposed new federal charter could be submitted for referendum simultaneously with the barangay elections on May 14, 2018. Under Con-ass, it’s the sitting lawmakers themselves—congressmen and senators—who will serve as the delegates. Earlier, House Committee on Constitutional Amendments Chairman Roger A. Mercado of the Lone District of Southern Leyte said liberalizing the restrictive economic provisions of the Constitution and the possible removal or extension of term limits of government

officials are among the top issues that would be discussed by Congress when it convenes into Con-ass early this year. Meanwhile, Bayan Muna Chairman and former lawmaker Neri Colmenares said the current Charter change proposal abolishes the office of the vice president, but does not disqualify President Duterte from running for President in 2022. “Under the PDP-Laban Constitution, the office of the vice president will be abolished by 2019 if they succeed in having the new Constitution ratified during the 2019 elections. Vice President Leni [Maria Leonor G.] Robredo will be ousted from her office long before her term ends in 2022,” Colmenares said. Jovee Marie N. dela Cruz

Economy

A4 Monday, January 15, 2018 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

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Cusi to OK circular allowing 2-year PSA to conduct four key FiT extension for hydro, biomass economic surveys in 2018

By Lenie Lectura

@llectura

CUSI: “It’s on my table for signing already. I am just reviewing the numbers to make sure that there is no misunderstanding. Definitely, it’s not three years. The extension is around two years only.”

nergy Secretary Alfonso G. Cusi is close to signing a department circular that will extend the feedin tariff (FiT) for existing run-of-river hydropower and biomass projects for two years.

“It’s on my table for signing already. I am just reviewing the numbers to make sure that there is no misunderstanding. Definitely, it’s not three years. The extension is around two years only,” Cusi said. If and when the two-year extension is implemented, the developers of run-of-river hydropower and biomass projects will be able to finish construction and consequently avail themselves of the FiT rates for 20 years. The 250-megawatt (MW) installation target for run-of-river hydropower and biomass expired at end-2017. However, the installation target was not fully subscribed. The Philhydro Association Inc. had said that the main cause for delay has been the difficulty in securing permits from various national and local government agencies in particular, the water permit and Free

and Prior Informed Consent with the indigenous people. “The most of the three years allotted for the FiT installation target are already consumed by the permitting process alone,” Philhydro said. Cusi said last week that the proposed extension would only cover existing run-of-river and biomasspower projects only. “The new projects will not be able to make it anymore. This is only for existing projects. We are just looking at it from the perspective of the proponents.… We want to be fair to all. We are avoiding policies and programs that will result in overrun.” Based on data from the Department of Energy, only five run-ofriver hydro projects with a total capacity of 34.60 MW were issued certificates of endorsement to the Energy Regulatory Commission (ERC) for FiT eligibility. This means

that 215.4 MW out of the 250-MW target have yet to be subscribed. For biomass projects, 19 projects with a total capacity of 138.61 MW were awarded certificates of eligibility. There is still a balance of 111.39 MW from the 250-MW target. The ERC had set a FiT rate of P5.90 per-kilowatt per hour (kWh) for run-of-river hydro. The rate has been degressed in 2017 to P5.8705 per kWh. For biomass projects, the FiT rate is P6.63 per kWh rate for the first round and a P6.5969-degressed rate in 2017. Based on Philhydro’s computation on the impact of all the hydro projects coming online by 2020 to the FiT-allowance at the current digressed rate of P5.87 per kWh, allowing an extension of the hydro FiT and allowing hydropower developers to complete the 250-MW installation target will only have a P0.01034 per kWh impact to the FiT-All by 2020.

he Philippine Statistics Authority (PSA) will be spending P64.61 million to conduct four key surveys, including the impact of the government’s conditional cash-transfer scheme, this year. Data showed the bulk of the funds will be used to finance the P44.04-million Comprehensive Socio-Economic Survey (CSES) for the Pantawid Pamilyang Pilipino Program (4Ps). The PSA will also be spending P12.12 million to conduct the 2018 Monthly Integrated Survey of Selected Industries (Missi); P5.87 million for the 2018 Producer Price Survey (PPS); and P2.58 million for the Financial Inclusion Survey (FIS). The PSA said the CSES aims to collect information to assess the impact of the 4Ps at the household and community level. It aims to obtain information on the general condition and status of the households, such as household health, education and other socioeconomic factors, as well as access to, availability of, and utilization of social services and infrastructure in the community. A total of 9,500 households, as well as officials of 28 provinces; 30 cities/municipalities; and 305 barangays across 17 regions will be selected to participate in the survey. The funds will be used for personnel services, maintenance and other operating expenses, such as traveling expenses, supplies and printing of materials and capital outlay. The results of the CSES will be released on September 30. The PSA said the Missi is a regular survey conducted by the PSA to collect data on employment, compensation, value of production, sales from manufacturing activity, other income, inventories of finished products, work-in-progress and raw materials and capacity utilization. “[The] Missi aims to provide planners and policy-makers in both government and private sectors with timely flash indicators on the performance of growth-oriented industries in the manufacturing sector. Data are used as inputs to monitor the business cycle of key manufacturing sectors of the economy,” the PSA said. The PPS aims to collect producer price data of manufactured commodities by specifications/brand names for the generation of producer price index (PPI). The PPI measures yearly and

monthly changes in the producer prices of key commodities in the manufacturing sector. A total of 1,000 establishments with total employment of 20 or more will be selected for Missi, while 1,000 establishments/1,000 commodities will be selected for PPS. “The two surveys will utilize a total of P17.99 million for maintenance and other operating expenses, such as traveling expenses, supplies and printing of materials,” the PSA said. As for the FSI, the PSA said it aims to gather information on account ownership; use of financial products and services, such as savings, loans, insurance, investments and payments; access points and experience on financial transactions; and sociodemographic profile of the respondents. A sample of 1,200 individuals aged 15 years old and above will be selected from households in Metro Manila, North Luzon, South Luzon, the Visayas and Mindanao. The funds will cover personal services; maintenance and other operating expenses; printing expenses; and expenses for the training of enumerators. “The conduct of the FIS is spearheaded by the Bangko Sentral ng Pilipinas, in partnership with Nielsen Co. Inc.,” the PSA said. The PSA was created through the passage of the Philippine Statistical Act, which was signed into law by former President Benigno S. Aquino III in 2013. It is the surviving entity after the merger of four statistical agencies—the National Statistical Coordination Board, Department of Agriculture Bureau of Agriculture Statistics and the Bureau of Labor and Employment Statistics of the Department of Labor. Under the law, the PSA will be responsible for all national censuses and surveys, sector statistics, consolidation of selected administrative recording systems and compilation of national accounts. Its main tasks include planning; development and prescription; dissemination and enforcement of policies, rules and regulations; and coordination of government-wide programs governing the production of official general-purpose statistics and the delivery of civil registration services. Cai U. Ordinario

ADB to spend $672.3 million for IT reforms, efficiency measures this year By Cai U. Ordinario

RELIGIOUS ITEMS A lady spruces up assorted images of the Santo Niño (Holy Child Jesus) on display at a store along Oroquieta Street in Santa Cruz, Manila, in preparation for the feast of the Santo Niño on the third Sunday of January. ROY DOMINGO

Mainstreaming in GVCs must be ultimate agenda of SME-development policy—study

ainstreaming of micro, small and medium-sized enterprises (MSMEs), particularly in value chains, has become even more urgent in light of global trends to integrate trade and de-integrate production, according to a new study from a state think tank. T he Ph i l ippi nes’s de ve lopment policy on MSMEs should focus on mainstreaming not only to engender inclusive growth but also to enable MSMEs to become drivers of growth, said the report, entitled “Mainstreaming SMEs: Promoting Inclusive Growth in Apec,” published last month by the Philippine Institute for Development Studies. In pursuing SME development as a major domestic policy objective, the global and regional environment can no longer be ignored, the report noted. “A more global perspective has become increasingly important with the ‘integration of trade’ and ‘de-integration of production’ arising from globalization forces and technological

development,” the paper stressed. “A more immediate goal for the government is to mainstream MSMEs in the value chains, whether local or global.” In the meantime, the government can aim for the higher goal of mainstreaming SMEs into global value chains (GVC). The study authors explained that when SMEs are able to mainstream in GVCs, “the prospects and benefits are magnified, as these benefits redound to a larger economic system.” SMEs that are mainstreamed in the international market generally perform better in productivity, competitiveness, innovation and sustainable growth, compared to those dealing only with the domestic market, they added. However, the paper said studies show low SME participation not just in the Philippines but in the Asian region overall. Within the Association of Southeast Asian Nations, most SMEs are still minor players in production networks as only 22 percent of them participate. The report said that crucial to the ease

with which SMEs are able to mainstream depends on “a good regulatory framework that is SME-friendly.” This should promote quality infrastructure trade facilitation, and overall general connectivity. “Unfortunately, the Philippines has not been faring well in many of these factors, especially in the area of logistics and infrastructure. Hopefully, the past reforms, which saw the Philippines improving in the global rankings could lead to better mainstreaming of Philippine SMEs.” The discussion paper said the government needs to address bottlenecks and constraints and provide a more conducive regulatory regime for SME participation in both the local and the global market and the GVCs. “The ultimate objective is to provide SMEs access and the opportunities and means to grow, and to encourage those SMEs with potential to eventually become major players, whether in the domestic or the international market,” the paper said. Philexport News & Features

@cuo_bm

he board of Manila-based Asian Development Bank (ADB) approved a budget of $672.3 million this year to support ongoing investments in information-technology (IT) reforms and organizational resilience. In a statement, the Manila-based multilateral development bank said this was only a 3.9- percent increase from 2017. Of the increase, 2.2 percentage points will accommodate price growth, while the 1.7 percentage points will be for volume growth. “This budget supports the ongoing investments in IT reforms and organizational resilience. ADB continues to make its utmost efforts at staff optimization and efficiency measures,” ADB said. A key priority for ADB in 2018 is to finalize its new corporate strategy, Strategy 2030, which will be the key topic in the ADB’s 51st Annual Meeting of its Board of Governors to be held in Manila again in May after six years. Strategy 2030, the impact of technological change and globalization on jobs, aging and longevity dividends, role of women entrepreneurs and private-sector participation in infrastructure development will be among the topics discussed. The preparation of the draft and internal consultations for Strategy 2030 will be completed in March. A draft strategy will then be posted in April. The Annual Board of Governors and civil society will have separate discussions of Strategy 2030 in May. The Board will then consider the final strategy toward the end of the year. The ADB said it expects more than 3,000 participants to attend the Annual meeting in May this year. Finance Secretary and ADB Governor Carlos G. Dominguez III recently met with ADB President Takehiko Nakao at ADB headquarters to discuss the preparations for the 51st Annual meeting. Dominguez and Nakao also discussed Strategy 2030, ADB’s new long-term strategy that will map the best ways ADB can support Asia’s growth and address development challenges, including poverty, climate change, urbanization, aging and widening inequalities. Dominguez also visited venues in ADB headquarters that will be used for the event, as well as the ADB Philippines Country Office. Based on preliminary figures for 2017, ADB operations—comprising approvals of loans and grants, technical assistance (TA) and cofinancing—reached $28.9 billion. Approvals of loans and grants from ADB’s own resources reached a record $19.1 billion, representing a 9-percent increase from the $17.5

billion seen in 2016. This puts ADB well on its way to meet its $20-billion target by 2020. Of the total, nonsovereign (primarily private sector) operations accounted for $3.2 billion, a 26-percent increase from $2.5 billion in 2016. TA, meanwhile, increased by about 22 percent to $205 million, from $169 million in the previous year. Commitments (the amount of loans and grants signed)—the ADB’s new performance measure—reached $20.1 billion. This is a significant increase from $13.3 billion in 2016, reflecting the signing of large projects approved in 2016 and 2017. “The strong figures for ADB operations in the past year were supported by the successful merger of ADB’s concessional Asian Development Fund lending operations with the Ordinary Capital Resources balance sheet—which took effect at the start of 2017,” Nakao said. “This will allow us to deliver a much higher level of assistance to our developing member countries for years to come without seeking a capital increase.” A highlight of ADB’s operational figures for 2017 is climate financing, which reached a record $4.5 billion (comprising mitigation $3.6 billion and adaptation $0.9 billion), a 21-percent increase from 2016. This places ADB in a good position to achieve its $6-billion climate financing target by 2020. Cofinancing approvals declined to $9.5 billion in 2017, from the $13.9 billion recorded in 2016, partly due to the delay of large expected cofinanced projects. Disbursements were $11.7 billion in 2017, compared to $12.7 billion in 2016. The ADB said this is because of lower approvals, and hence disbursements, of policy-based lending and countercyclical support facility, among other factors. Among ADB’s other operational highlights were projects that combine finance with innovative approaches to development, including satellite data and remote sensing to improve irrigation in Indonesia and Pakistan, pilot testing of climate-smart agriculture practices in Bangladesh, and supporting social welfare reforms in Mongolia to promote human development. The ADB also said its innovative $100-million TA loan to the Philippines, approved in October 2017, will help the government prepare and deliver infrastructure projects under its “Build, Build, Build” program. On the funding side, ADB offered new and innovative thematic products, such as the health bond and gender bond. This is on top of increased efforts to raise local currency funding to meet the growing demand for nonsovereign local currency loans.

Agriculture/Commodities BusinessMirror

www.businessmirror.com.ph

Editor: Jennifer A. Ng • Monday, January 15, 2018

Milled-rice output seen hitting 12 MMT

A farmer piles up grain harvested from a rice field in Nueva Ecija. The United States Department of Agriculture projected that Philippine milled-rice output this year would increase by more than 2 percent. FILE PHOTO

By Jasper Emmanuel Y. Arcalas

@jearcalas

hilippine milled-rice production could reach a record high of nearly 12 million metric tons (MMT) this year, as the continued implementation of the quantitative restriction (QR) on rice will encourage more farmers to plant the staple.

A c c o r d i n g t o t h e U n it e d St ate s D e pa r t me nt of A g r i culture (USDA), the projected m i l led-r ice out put t h is yea r i s 2.69 percent h igher t h a n t he 11.6 8 6 M M T e s t i m ate d production in 2017. “The USDA estimates 2017/18 Philippines rice production at a record 12 million tons [milled basis], up 800,000 metric tons, or 7 percent from last month, and up 2 percent from last year,” the Washington-based agency

said in its report, titled “World Agricultural Production,” which was published recently. “ T he QR on r ice i mp or t s remains in effect, incentivizing producers to stay in rice,” it added. The USDA also said the use of high-yielding varieties and favorable weather conditions would help boost milled-rice output this year. “Additionally, there were noticeably fewer typhoons with the potential to damage rice passing through the major production areas compared to previous years,” it added. The USDA said the total rice area harvested this year would reach 4.8 million hectares, 1.69 percent higher than last year’s 4.72 million hectares. The count r y ’s n at ion a l average pa l ay yield will slightly increase to 3.96 MT per hectare from the estimated 3.93 MT per hectare yield in 2017. “Harvested area is estimated at 4.8 million hectares, tied with the previous record in 2013/14. Estimated harvested area and product ion were bot h ra ised based on estimates from the Philippines Statistics Agency [PSA],” the USDA said. Because of the expected hike in output this year, the USDA trimmed down its projection for Philippine rice imports to 1.3 MMT, from 1.7 MMT.

However, the figure is still 18.18 percent higher than the 1.1 MMT estimated total import volume last year. The USDA estimated that the country’s beginning rice stock this year is at 1.996 MMT. It pegged the country’s total rice requirement for 2018 at 12.9 MMT, while total rice stock could reach 15.266 MMT. T he D e pa r t me nt of A g r i culture said it is targeting to harvest 20.341 MMT of paddy from 4.84 million hectares this year. At this production level, t he DA noted t hat t he Phi lippines wou ld be 96 -percent self-sufficient in rice. At a milling recovery rate of 65 percent, milled-rice output this year could reach 13.22 MMT, based on the BusinessMirror’s computation. In a report, the PSA estimated that the country’s paddy output for 2017 likely reached 19.4 MMT, 10.11 percent higher than the 18.15 MMT produced in 2016. “Probable palay production for the October-to-December period may surpass the 2016 level by 6.26 percent. T he anticipated increment in output may be attributed to increase in yield resulting from sustained use of high-yielding varieties coupled with sufficient water supply during the early stages of crop development,” the PSA said.

‘Compliance with standards key to gaining access to agribusiness global value chains’

gricultural producers need to comply with a strict set of standards and upgrade in various ways to gain access to global value chains. A policy brief published by the Department of Trade and IndustryBureau of Trade and Industrial Policy Research said traditional global markets have been replaced with vertically coordinated market linkage systems. Under such market-linkage systems, local sourcing in both developed and developing countries has largely been replaced by centralized national, regional or international supply chains with strict sets of standards. “National and global lead firms now dictate how products are cultivated, harvested, transported, processed and stored through a series of public and private standards that producers, both large and small, around the world must comply with in order to maintain access to markets,” it said. The policy briefs noted that, over the past three decades, high-value agricultural markets have become more sophisticated, consolidated and regulated, making it increasingly difficult for new actors to participate and upgrade in these value chains. Philexport News & Features

Banking&Finance

A6 Monday, January 15, 2018 • Editor: Jun B. Vallecera

BusinessMirror

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US SEC allows $1-B PHL bond sale sans usual review By Rea Cu

@ReaCuBM

he United States Securities and Exchange Commission (SEC) has done away with the review of the country’s proposed dollar-denominated bonds and allowed the sovereign to proceed and raise $1 billion from the market. This was learned from the Bureau of the Treasury (BTr) who said the proposed issuance of ROPs or global bonds this year will no longer be reviewed by the US SEC. According to Deputy Treasurer Sharon P. Almanza, the agency is now assessing conditions at the market whose main preoccupation at the moment has to do with how soon the US Federal Reserve decides to recalibrate its monetary-policy stance. Almanza said Treasury officials are ready to launch the sale of the global bonds amounting to around $1 billion this year.

“For the ROP, we just got the feedback that the [US SEC] will not conduct a full review so we would just line the issuance. I think we are almost ready for the launch of the ROP, but depending on the market conditions,” Almanza told financial reporters. Last year the Philippines sold 25-year ROPs worth $2 billion the bulk of which, or $1.5 billion, was earmarked for so-called liability management and $500 million set aside to finance previously identified government programs. The bonds had a coupon rate of 3.70 percent, the lowest coupon ever issued

by the gover nment. ROP bonds are shor t hand for dol l ar- denominated IOUs issued by t he Republ ic of the Philippines. Last December the BTr said it needed to secure US SEC approval before it can go through with the sale of global bonds this year. According to the Department of Finance (DOF), the successful outcome of the global bond sale last year underscored the continuing investor confidence in the leadership of President Duterte and his administration’s agenda for high and inclusive growth. The DOF said proceeds from the global bond sale would help finance the government’s infrastructure buildup bid, or its “Build, Build, Build” program. Order books for the 25-year global bond offering were approximately $4.5 billion. By geographical allocation, 33 percent came from Asia, 24 percent from the United States and 43 percent from Europe. The global bond sale was the first international capital markets transaction under President Duterte last year. C it ig roup, C red it Su i sse, Deut sc he Bank, Standard Chartered Bank and UBS acted as joint global coordinators, dealer managers and bookrunners for the transaction.

Local data help BIS craft global banking policy

he Philippines has joined a select group of countries whose banking statistics now form part of a global database on lending systems and how best such may be managed. According to the Bangko Sentral ng Pilipinas (BSP), particular details on banking operations in the Philippines would be regularly forwarded to the Bank for International Settlements (BIS) from this point forward. In a statement issued over the weekend, the BSP said Manila would form part of only a handful of countries worldwide that report cross-border banking statistics to the BIS. “After months of testing and validation, cross-border banking data maintained by the Bangko Sentral ng Pilipinas has been judged as meeting the rigorous BIS standards for completeness and quality,” the BSP said. T he BIS welcomed t h is develop ment, saying the participation of the

Philippines as part of less than 50 jurisdictions worldwide that reports to the BIS is a “significant milestone because it confir ms the inter nationa l importance of the Philippine banking system,” BIS General Manager Agustin Carstens said. BSP Governor Nestor A. Espenilla Jr. said the country’s inclusion in an elite group of reporting countries provides the BSP with more granular cross-border banking data that would be “very critical in formulating well-informed policies when and how they may be needed.” “The value to regulators of having such a view cannot be overemphasized in today’s market,” he said. The BSP also highlighted its longstanding direction of working diligently on instilling high-quality banking data, saying the inclusion of the Philippines as a BIS-reporting jurisdiction validates their efforts in meeting international standards. Bianca Cuarema

Duterte TRAIN running on schedule MWSS cites gains; water PPP works wonders

he Department of Finance (DOF) said the rollout of infrastructure projects under President Duterte is proceeding as planned following the passage of the Tax Reform for Acceleration and Inclusion (TRAIN) Act. Helping make this possible were the proceeds from so-called official development assistance (ODA) loans from countries offering the Philippines below-market credit assistance. According to Finance Secretary Carlos G. Dominguez III, the rollout of big-ticket infrastructure projects are proceeding as planned following the signing into law of the TRAIN Act and the successful prosecution of ODAs, both of which help bankroll ventures under the “Build, Build, Build” (BBB) program. DOF Undersecretary and Chief Economist Gil S. Beltran said that, with the TRAIN in place, the government’s BBB agenda “will go into high gear” this year, with majority of the 75 flagship projects worth a combined P1.8 trillion already in the construction or preconstruction phases. “It’s just that the BBB policy will go on

a high gear [this year]. There are already 60 projects under construction under the BBB. The project cost of the 60 projects is P1.8 trillion, funded mostly by ODAs. The 60 projects are already under construction or under preconstruction,” Beltran told financial reporters. Among the 60 projects already in construction and preconstruction phases include the P23-billion Metro Manila Flood Management Project cofunded by the Asian Infrastructure Investment Bank and the World Bank; the P151-billion Philippine National Railways South Long Haul Line to be financed by ODA from China; and the P355.6-billion Mega Manila Subway funded by ODA from Japan. Dominguez said the P19.8 billion Davao City Bypass Road, another flagship project, is also under the implementation phase. “You know it’s coming together. Believe it or not, even I am surprised. The money is coming in from our tax. The loans are coming in as we signed yesterday. The implementing agencies are getting their act together,” he added. Rea Cu

ith the Public-private partnership (PPP) among Metropolitan Waterworks and Sewerage System (MWSS), Manila Water, Maynilad and Luzon Clean Water Corp. continuing to work wonders, MWSS Administrator Reynaldo V. Velasco said that 2017 was a

good year brought about by strong investors confidence on the administration of President Duterte. The water agency managed to implement several projects geared toward providing adequate water supply to Metro Manila residents and nearby provinces.

Case clippings

By Justice S J Ranada Jr.

EVIDENCE–accused not identified in open court Where the failure to identify the accused in open court was directly attributable to his own actions, to absolve him of penal liability on this ground alone would open the floodgates for malefactors to evade conviction by the simple expedient of refusing to appear at scheduled hearings where they expect to be identified in court. This would set a dangerous precedent and is antithetical to the foundations for our judicial system. Montelibano v. Yap GR 197425 06 Dec. 2017 Martires, J

“Our mission at MWSS is to work with our partners in progress for the well-being of our consumers notably on water supply for the 15 million consumers that must always be sufficient, safe and continuous for personal and domestic uses,” Velasco said over the weekend. To map out a new 10-year development plan on new water sources that zeroes in on Umiray and Sumag (350 MLD), Kaliwa (600 MLD), Laiban (1,800 MLD) and the possible reinstatement of Wawa Dam (350 MLD) into an active state after 24 years of dormancy, MWSS has formed a new Technical Working Group comprising of MWSS and its three concessionaires—Manila Water, Maynilad and Luzon Clean Water Development Corp. The arching goal is to match Angat dam’s 4,000 MLD production. “Having these additional flagship projects approved and started in the next five years would be enough for Water Security Legacy of the Duterte administration for the next generations of Filipinos and consumers in Metro Manila, Rizal, Cavite and Bulacan,” Velasco said.

Perspectives

Living up to customer expectations: Talking to bank CEOs

he good news is that, most banks have made great progress toward becoming more “customer centric” over the past few years. In part, this is because many bank CEOs have taken a personal interest in getting closer to their customers. Indeed, according to KPMG’s 2017 Global CEO Outlook, two-thirds of bank CEOs feel personally responsible for representing the best interests of their customers, and 65 percent say they can confidently articulate the customer value proposition. At the same time, we’ve seen many of the large banks start to invest significant capital and resources into improving the customer focus of their organizations. They are testing out new technologies that promise to speed transactions and processes, taking steps to align their middle- and back-office processes around the customer, developing financial technology (fintech) strategies to improve the customer experience, and putting serious effort into improving their customer data and analytics approaches. My conversations with top bank CEOs suggest they also recognize the urgency of the challenge and the value of good customer experiences. This is an important development, especially in a world where customers compare their banking experience against their “last, best” service experience (say, at Starbucks or on Amazon).

We’re just getting started

Progress has certainly been made. Yet, experience suggests there is still lots to

do before bank CEOs can consider themselves truly customer-centric. For starters, banks will need to break down their internal siloes to achieve a more holistic, “single view” of their customers. In part, this will require them to adopt newer technologies (such as APIs and RESTful services) that allow them to share customer data across their various businesses. It will require new processes and tools, and it will necessitate a cultural change that incentivizes a focus on experience rather than sales and business targets. At the same time, most banks will need to redouble their efforts to improve their middle- and back-office processes to deliver the front-office experiences customers now expect. This is often referred to as the Customer Experience —how they interact with their banks— versus the User Experience or their first impression of the bank’s channels. This will mean deeper application of technologies, such as robotic process automation, natural language processing and artificial intelligence. It will require more flexibility and agility in the way processes are designed and managed, and greater alignment between the user interface and back-end technologies. Banks will also need to vastly improve their market-sensing capabilities. They will need to be able to “look around the corner” to predict what their customers will want and how they will want to be

served. They will need to become much better at targeting and narrowing their customer segments with the ultimate goal being to get to a segment of one. And they will need to understand how to turn these insights into real and valuedriven action.

Advantage banks

While this may seem like a world where fintechs have the upper hand, the reality is that, traditional banks are building from a very solid foundation. Thanks to their long history and decades of customer relationships, traditional banks are able to draw on deep experience managing customers across their financial lifecycle. Notwithstanding recent declines in customer trust, banks have a strong legacy of delivering secure, smart and valuable services to their customers. Few customers worry that their bank will fail or “sell out” to the highest bidder. Traditional banks are also kings of process and compliance. They may not yet possess the agility of fintechs, but they certainly understand the need for rigor behind the processes and they know how to manage regulations. Customers can be confident their banks are doing the right things to manage their money. Most important, is the fact that traditional banks (tend to) offer a wide range of different and aligned services. As I noted in a recent KPMG report, “Me, My Life, My Wallet,” customers are becoming

increasingly weary of managing multiple service providers to fulfil their various financial requirements. Many find the disparate array of services confusing. It’s reaching a point where the niche player fintechs are at risk of having their customers give up, frustrated by the effort it takes to build a few more points or to get a nominal discount.

Three steps to great customer experiences

So, what should banks be doing to deliver excellent customer experiences? My work with leading financial institutions suggests there are three main areas where banks should be putting their focus. First, they should be doing what KPMG professionals call “outside-in sensing”—taking the time to understand how the world around them is changing and thinking about how that will impact their business. This includes everything from technological disruptions and shifting customer expectations through to competitive activity and regulatory changes. Next, they will need to run “insideout scenarios”—taking all of the information they gathered from their outside-in sensing and running what-if scenarios to identify exactly how these trends apply to their business and operating models, what new opportunities they create and what risks they need to avoid. Finally, they need to develop a simple,

yet thorough framework for execution. KPMG professionals often use KPMG’s “Nine Levers of Value” framework, which breaks the necessary steps down into digestible components to enable decisionmakers to translate business strategy into operating model tactics.

Time to adapt

While many organizations are clearly making great strides toward customercentricity, KPMG professionals’ view of the market suggests that there is little time to waste. Many of the leading banks are expected to successfully transform into new, more customer-centric versions of themselves within the next two years. Armed with their strong heritage, deep experience and new technologies, all signs suggest that these early movers will be the real disruptors of the future. The article “Living up to customer expectations: Talking to bank CEOs” by Mitchell L. Siegel, KPMG in the United States. was taken from KPMG’s Global Banking CEO series. R.G. Manabat & Co., a Philippine partnership and a member-firm of the KPMG network of independent member-firms affiliated with KPMG International Cooperative (KPMG International), a Swiss entity. All rights reserved. Printed in the Philippines. For more information on KPMG in the Philippines, you may visit www.kpmg. com.ph.

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The World BusinessMirror

Monday, January 15, 2018 A7

Error in missile alert sends Hawaii in panic

n early-morning emergency alert mistakenly warning of an incoming ballistic missile attack was dispatched to cell phones across Hawaii last Saturday, setting off widespread panic in a state that was already on edge because of escalating tensions between the United States and North Korea.

The alert, sent by the Hawaii Emergency Management Agency (Hema), was revoked 38 minutes after it was issued, prompting confusion over why it was released—and why it took so long to rescind. State officials and residents of a normally tranquil part of the Pacific, as well as tourists swept up in the panic, immediately expressed outrage. “What happened today was totally unacceptable,” Gov. David Y. Ige said. “Many in our community were deeply affected by this. I am sorry for that pain and confusion that anyone might have experienced.” Officials said the alert was the result of human error and not the work of hackers or a foreign government. The mistake occurred during a shift-change drill that takes place three times a day at the emergency command post, according to Richard Rapoza, a spokesman for the agency. “Someone clicked the wrong thing on the computer,” he said. State officials said that the agency and the governor began posting notices on Facebook and Twitter announcing the mistake, but that a flaw in the alert system delayed sending out a cell-phone correction. As a result, they said a “cancellation template” would be created to make it easier to fix mistaken alerts. A new procedure was instituted last Saturday requiring two people to sign off before any such alert is sent. At no time, officials said, was there any indication that a nuclear attack had been launched on the US. The Federal Communications Commission announced that it had begun “a full investigation into the FALSE missile alert in Hawaii.” The alert went out at about 8:10 a.m., lighting up phones of people still in bed, having coffee by the beach at a Waikiki resort, or up for an early surf. “Ballistic Missile Threat Inbound to Hawaii. Seek Immediate Shelter. This is Not a Drill,” it read. Hawaii has been on high emotional alert—it began staging monthly air-raid drills, complete with sirens, last December— since President Donald J. Trump and Kim Jong Un, the leader of North Korea, began exchanging nuclear threats. Estimates vary, but it would take a little more than half an hour for a missile launched from North Korea to reach Hawaii. State officials said that residents here would have as little as 12 minutes to find shelter once an alert was issued. Within moments of the first announcement, people flocked to shelters, crowding highways in scenes of terror and helplessness. Emergency sirens wailed in parts of the state, adding to the panic. “I was running through all the scenarios in my head, but there was nowhere to go, nowhere to pull over to,” said Mike Staskow, a retired military captain. Allyson Niven, who lives in Kailua-Kona, said her first instinct was to gather her family as she contemplated what she thought would be her final minutes alive. “We fully felt like we were about to die,” she said. “I drove to try to get to my kids even though I knew I probably wouldn’t make it, and I fully was visualizing what was happening while I was on the road. It was awful.” Ray Gerst was vacationing on Oahu with his wife to celebrate their 28th wedding anniversary. He received the alert as

China steps up policing of intl firms over sovereignty issue

hina is stepping up its policing of international companies, such as Inditex SA-owned Zara and Delta Air Lines Inc., and demanding they respect the government’s position on long-standing territorial disputes from Taiwan to Tibet. The Cyber Administration Office in Shanghai last Friday said Zara listed Taiwan, an island that China claims as its own, as a separate country on its web site. On the same day, China’s Civil Aviation Administration summoned executives of Delta as the carrier on its web site listed Taiwan and Tibet, located in western China, as nations. The companies were asked to change the “illegal” contents. China, emboldened by its growing economic and geopolitical influence, is showing less tolerance of what it sees as violations of its political bottom line by foreign companies. The warnings signal that the country may deploy more sticks against foreign companies that can’t risk losing business in the world’s second-biggest economy. “The general political atmosphere these days is that you don’t stand on the wrong side of sovereignty issues in the Xi Jinping era,” said Ether Yin, partner at research firm Trivium China in Beijing. “The government responded very quickly.” International companies operating in China should respect its sovereignty and territorial integrity, state broadcaster CCTV said, citing Foreign Ministry Spokesman Lu Kang’s comments at a regular briefing. Bloomberg News

they pulled up for their tour of Kualoa Ranch. “All the buses stopped, and people came running out of the ranch and said, ‘Just sit still for a minute, nobody get off the bus, nobody get off the bus,’” he said. They were taken into the mountains, Gerst added, and dropped off at a concrete bunker. They sheltered in place for

about 15 minutes, he said, during which time they had no cell signal. “It was scary,” Gerst said. “I mean, there was no intel.” At Konawaena High School on the Island of Hawaii, where a highschool wrestling championship was taking place, school officials, more accustomed to alerts of high surf or

In Washington, Lindsay Walters, a deputy press secretary, said that President Donald Trump had been informed of the ...(Continued on next page) Next Page Back events. “The president has been briefed on the state of Hawaii’s emergency management exercise,” she said. “This was purely a state exercise.” Sen. Brian Schatz of Hawaii said the mistake was “totally inexcusable.” “The whole state was terrified,” he said. “There needs to be tough

tsunamis, moved people to the center of the gym as they tried to figure out how to take shelter from a missile. “Everyone cooperated,” said Kellye Krug, athletic director at the school. “Once they were gathered, we let them use cell phones to reach loved ones. There were a couple kids who were emotional, the coaches were right

and quick accountability and a fixed process.” While the cellphone alerting system is in state authorities’ hands, the detection of missile launches is the responsibility of the U.S. Strategic Command and Northern Command. It was the military — not Hawaiian officials — that was the first to declare there was no evidence of a missile launch. The false alert was a stark reminder of what happens when the old realities of the nuclear age collide with the speed — and the potential for error — inherent in the internet age. The alert came at one of the worst possible moments — when tension with North Korea has been at one of the highest points in decades, and

when Kim’s government has promised more missile tests and threatened an atmospheric nuclear test. (BEGIN OPTIONAL TRIM.) During the Cold War there were many false alarms. William J. Perry, the defense secretary during the Clinton administration, recalled in his memoir, “My Journey at the Nuclear Brink,” a moment in 1979 when, as an undersecretary of defense, he was awakened by a watch officer who reported that his computer system was showing 200 intercontinental ballistic missiles headed to the United States. “For one heartstopping second I thought my worst nuclear nightmare had come true,” Perry wrote.

there to console kids. After the retraction was issued, we gave kids time to reach out again.” Matt LoPresti, a state representative, told CNN that he and his family headed for a bathroom. “I was sitting in the bathtub with my children, saying our prayers,” he said. New York Times News Service

It turned out that a training tape had been mistakenly inserted into an early-warning system computer. No one woke up the president. But Perry went on to speculate what might have happened if such a warning had come “during the Cuban missile crisis or a Mideast war?” The United States faces an especially difficult problem today, not just because of tense relations with North Korea but also because of growing fears inside the military about the cyber vulnerability of the nuclear warning system and nuclear control systems. Because of its location, Hawaii — more than any other part of the United States — has been threatened by escalating tensions and the risks

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Trump’s ultimatum on Iran nuke deal tests European allies

resident Donald J. Trump has handed European allies an ultimatum to revamp the nuclear deal with Iran, something they have no intention of doing, posing a potential new conflict with other world leaders.

“This is a last chance,” Trump vowed last Friday in a statement announcing that he’d waived economic sanctions tied to the 2015 accord a final time. “No one should doubt my word.” Trump warned that he would scrap the agreement limiting Iran’s nuclear program—an accord he has long despised—unless European countries “join with the United States in fixing significant flaws in the deal.” He effectively gave them a deadline of 120 days, the next time he’d have to decide under American law on whether to waive sanctions. While most European leaders were silent last Saturday, those who reacted were unhappy with Trump’s approach. “Operating under an ultimatum leads to nothing,” Luxembourg Foreign Minister Jean Asselbourn told Welt am Sonntag in Germany. “Abandoning the nuclear deal with Iran will

not lead to more stability but, rather, would endanger world peace.”

Mistake, miscalculation

Russia’s Deputy Foreign Minister Sergei Ryabkov said Trump is signalling that the decision to withdraw from the multilateral accord “is already made or is about to be made,” which he called one of the US’s “largest foreign-policy mistakes, one of the largest miscalculations of American politics,” according to Interfax. Many European leaders have made clear for months that they agree with international inspectors that Iran is abiding by limits on its nuclear program set out in the deal it made with the US under former President Barack Obama and five other world powers. Among Trump’s demands are the elimination of sunset provisions in the agreement that will phase out many restrictions on

Iran’s nuclear program in coming years, and spelling out that Tehran’s nuclear and ballistic-missile programs should be considered “inseparable.” The nuclear accord doesn’t directly bar missile testing. “In a nutshell, what’s he’s saying is, ‘Kill the deal with me or I’ll kill it alone,’” said Rob Malley, vice president for policy at the International Crisis Group, who was Obama’s Middle East adviser. “My impression talking to Europeans is, yes, they want to salvage the deal,” but imposing new requirements last Iran may give it reason to walk away. “Trump’s policy & today’s announcement amount to desperate attempts to undermine a solid multilateral agreement,” Iran’s Foreign Minister Javad Zarif said in a tweet on Friday. “Rather than repeating tired rhetoric, US must bring itself into full compliance— just like Iran.” The president once again waived economic sanctions that were explicitly tied to Iran’s nuclear program and were eased under the accord. American laws governing those sanctions require the waivers to be renewed every several months. The Treasury Department also issued new sanctions against 14 people and entities involved with the country’s ballistic-missile programs and the government’s

Iranian Foreign Minister Jawad Zarif (left) shakes hands with Belgian Foreign Minister Didier Reynders during a meeting at the Egmont Palace in Brussels last Thursday. European Union foreign ministers held separate talks with their Iranian counterpart in Brussels last Thursday, amid doubts over the future of an international agreement curbing the Islamic Republic’s nuclear ambitions. AP/Virginia Mayo

recent crackdown on protesters.

‘Worst’ deal

As a presidential candidate, Trump threatened to shred what he’s called “the worst deal ever.” The last time the agreement came up for review, last October, aides had to talk him out of abandoning it completely. Instead, Trump said then that he would give lawmakers a chance to amend the Iran Nuclear Agreement Review Act, the 2015 bill that was passed as a way to impose a degree of congressional oversight over the agreement. A key element of Trump’s plan is that sanctions will be reimposed— or “snap back”—automatically if Congress finds Iran to be violating the terms of the accord. In effect, Trump’s proposal calls for American lawmakers to take over judgments on Iran’s compliance with the nuclear deal from the International Atomic Energy Agency.

France’s playful baby panda makes 1st public appearance

ARIS—France’s first baby panda has made his grand public entrance by acting like many fivemonth-olds—climbing all over his mother, who looked like she just wanted to rest instead. Mostly hidden from view since his birth last August, the panda named Yuan Meng left his den last Saturday for his first public appearance. BFM TV video showed him endlessly crawling over his mother who, at one point, gathered the black-andwhite ball of fur to her side before he escaped again to climb over her. French first lady Brigitte Macron, considered the panda’s “godmother,” announced the panda’s name at a ceremony last December at Beauval Zoo, south of Paris, attended by Chinese officials. It means “the realization of a wish” or “accomplishment of a dream.” AP

Discreet talks

The US has been holding frequent, discreet talks with European leaders about what’s next regarding the

Panda cub Yuan Meng, which means “the realization of a wish” or “accomplishment of a dream,” eats bamboos with his mother Huan Huan at the Beauval Zoo, in Saint-Aignan-sur-Cher, France, last Saturday. Zoo Parc de Beauval via AP

according to the statement. Prime Minister Theresa May’s office took issue with Trump’s unflattering portrait of the new site as an “off location.” “Vauxhall is a vibrant and important part of London and home to many businesses,” May’s spokesman, Max Blain, told reporters last Friday. May’s former chief of staff Nick Timothy suggested the president should try visiting a famous gay bar in the area. Relations between the US and its closest ally have been tested repeatedly since Trump took office almost a year ago. An invitation from May for Trump to visit Queen Elizabeth II has encountered growing opposition, fueled in part by the president’s Twitter criticism of London Mayor Sadiq Khan and his retweets of propaganda from a far-right British anti-Muslim group. Londoners “have made it clear that Donald Trump is not welcome here,” Khan said. “His visit next month would, without doubt, have been met by mass peaceful protests.” Still, British officials said their

government had been working on the basis that Trump would arrive late-February, though no firm date had been set. The president, however, had become fed up with all the criticism and considered it an affront not only to his administration, but to his country, a White House official said last Friday. The official, who asked for anonymity to discuss a sensitive diplomatic matter, said Trump’s decision reflected his belief that there was nothing to gain by going to Britain now. One prominent British Trump fan suggested he may have been looking for a good excuse to call off a visit. “It’s disappointing,” Nigel Farage, the former leader of the UK Independence Party told BBC Radio’s Today program last Friday. It’s possible that plans for “mass protests, those optics he didn’t like the look of.” While the embassy statement emphasized that the US was able to erect a new building project through a property swap, without using taxpayer funds, Trump might have a point on the economics of selling the old embassy in London’s tony

Mayfair district. The transaction took place at the bottom of the last real-estate downturn, data compiled by broker Jones Lang LaSalle Inc. for Bloomberg News shows. Values for the best offices in the West End, which includes Mayfair, have doubled since then. The State Department agreed to sell the Mayfair building to Qatari Diar Real Estate Investment Co. in 2009 to finance the relocation. The investors have sought approval to turn it into a hotel, according to the project’s web site. The president’s decision to stay away also may have averted a potential royal snub. There’s been speculation that Trump isn’t happy that he may not be invited to the forthcoming wedding of Prince Harry and his American fiancee Meghan Markle. The prince is on friendly terms with Obama, who UK media have suggested will be invited. “Who his Royal Highness Prince Harry and Miss Markle invite to their wedding is really a matter for them,” said senior Conservative Party lawmaker Tom Tugendhat.Bloomberg News

accord, which Iran reached with the US, Britain, France, Germany, China and Russia. The allies initially held back f r o m c o n d e m n i n g Tr u m p ’s ultimatum. “We have noted the White House statement,” said a spokesman for the British embassy in Washington. “We will be discussing this with our European partners and with the United States, and will respond in detail in due course.” Law ma kers in Washington have d iv isions about how to proceed. “I’m all in favor of trying to address the agreement’s weaknesses,” Rep. Eliot Engel, a New York Democrat, said in a statement. “But the way to do so is to engage with international partners and build momentum to negotiate new provisions. The wrong approach is to bully countries with arbitrary and unenforceable deadlines.” Bloomberg News

S. Africa’s new party leader targets ‘billions’ in graft

Trump’s reason for skipping UK questioned, even by embassy resident Donald J. Trump’s decision to forgo a visit to London to open a new United States embassy kindled doubts about his justification for staying away—even from his own nation’s diplomats. Trump asserted late last Thursday on Twitter that he “canceled” his trip to the United Kingdom next month because he didn’t like the deal under which the embassy was moved. He blamed former President Barack Obama’s administration for selling the old site for “peanuts” and building the new embassy in an “off location.” In short, the real-estate mogul pegged it as a lousy deal. Yet, last Friday, the US embassy in London joined British officials in rebutting his claims. The old building had “aged beyond its ability” to be improved to meet security and safety standards without a major infrastructure investment, the embassy said in a statement. Teams surveyed more than 50 sites before settling on the area of Vauxhall, south of the river Thames, for the new location,

“I’ve been warning about this for a year—that Trump is serious about walking away from the deal, and people like me who want to fix the deal and not collapse it have to get our act together and get it fixed because there are fatal flaws,” said Mark Dubowitz, chief executive of the Washingtonbased Foundation for Defense of Democracies, who has advocated for Iran sanctions and helped Congress write them. Still, Trump left some room to maneuver in his statement. He didn’t say exactly what European allies must do beyond addressing the deal’s flaws, countering Tehran’s aggression and “supporting the Iranian people.” Whether that must come in binding action isn’t clear.

OHANNESBURG—The new leader of South Africa’s ruling party vowed last Saturday to crack down on the corruption that has weakened the African National Congress (ANC) in a new push to end inequities that haunt the nation more than 20 years after the end of white minority rule. “Billions of rands have been illegally diverted to individuals,” Cyril Ramaphosa said in a speech to celebrate the party’s 106th anniversary. It was Ramaphosa‘s first major public address since he was elected to lead Africa’s oldest liberation party last December, replacing scandal-prone President Jacob Zuma as party leader. He likely will be elected the next president in 2019. Public frustration over corruption allegations against Zuma deeply split the ANC in recent months, and Ramaphosa has been pressured by opposition parties and some ANC members to recall Zuma as president. Zuma was booed upon his arrival at Saturday’s event. Ramaphosa instead, is emphasizing the need to unify the party. The ANC “has become deeply divided through factionalism, patronage, corruption and competition for resources,” he said. “At the center of our efforts this year is unity.” On the eve of a high-level ruling party meeting this week that had threatened to discuss his fate, Zuma acknowledged the pressure, announcing last Tuesday that he was appointing a commission of inquiry to look into the corruption allegations. “This matter cannot wait any longer,” he said. R a m apho s a l a s t S at u rd ay thanked Zuma for that decision. “Corruption in state-owned enterprises and other public institutions has undermined our govern-

ment’s programs to address poverty and unemployment,” Ramaphosa, also the country’s deputy president, said. “We are going to confront corruption and state capture in all its forms.” The ANC has been in power since the country’s first democratic elections in 1994, but voters have grown disillusioned with the party of Nelson Mandela under Zuma’s tenure. South Africa’s economy brief ly dipped into recession last year, and unemployment hovers close to 30 percent. In the 2016 municipal elections, the ANC lost control of the commercial hub of Johannesburg and the capital, Pretoria, for the first time. Observers have warned that, if support continues to dwindle, the party faces the possibility of losing its national majority last 2019 and having to govern as part of a coalition. At the party conference last December, Zuma acknowledged serious challenges but pushed back against allegations of graft, asserting that “theft and corruption” in the private sector is just as bad as in South Africa’s government and that “being black and successful is being made synonymous to being corrupt.” Ramaphosa now faces the task of reviving confidence in both the government and the economy. He pledged last Saturday to address the country’s lingering inequality through a program of “radical socioeconomic transformation,” including free higher education for poor and working-class students, a national minimum wage and land expropriation without compensation. “We aim to restore our focus on building an economy in which all South Africans can flourish, an economy that benefits the people as a whole rather than a privileged few,” he said. AP

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Spanish, Dutch agree to push for soft Brexit S panish and Dutch finance ministers have agreed to push for a Brexit deal that keeps Britain as close to the European Union (EU) as possible, according to a person familiar with the situation. Spanish Economy Minister Luis de Guindos and his Dutch counterpart Wopke Hoekstra met earlier this week and discussed their common interests in Brexit, according to the person, who declined to be identified. Both have close trade and investment ties and are concerned about the impact of tariffs. They are also worried about losing United Kingdom contributions to the EU budget, the person said. The pound jumped to the strongest level since the referendum in 2016, trading 1.2 percent higher at $1.3690. A spokesman for the Spanish Economy Ministry stressed that both ministers support chief EU negotiator Michel Barnier’s efforts, and said they’re not working together toward a soft Brexit deal. Earlier, a Spanish economy ministry official said that the two finance chiefs had underlined the importance of UK ties for both countries, and agreed to keep track of their common interests. A spokesman for Hoekstra declined to comment. The 27 remaining EU nations maintained a united front in the first phase of divorce talks, though the solidarity is already showing signs of strain as national interests diverge in the face of future trade discussions. French President Emmanuel Macron has warned countries to be disciplined and stick together to protect all their interests, in a kind of prisoner’s dilemma. European Union countries have delegated the job of negotiations to Barnier. The UK wants what it calls a bespoke trade deal with the EU, which would allow it to continue trading goods as it does now and also have access to the single market for services—including its crucial financial-services industry. But it wants to leave the single market and not be bound by its rules. Barnier has made clear that the UK’s intention to restrict immigration from Europe and break free from judgments of the European Court

of Justice means it can only expect a trade deal modeled on the one the Europian Union has with Canada— a dramatic downgrade from its current status. Some national governments appear to be taking a more pragmatic approach, with Italian Prime Minister Paolo Gentiloni saying last month that some kind of tailor-made deal would be needed. The UK is an important trading partner for the Netherlands, whose ports face the east coast of Britain, while Spain caters to millions of British tourists each year as well as having huge investments in United Kingdom-based companies. While Spain is shaping up to be a UK ally when it comes to the future EU trade deal, tensions are already emerging over Gibraltar—a United Kingdom territory off the southern tip of Spain whose status after Brexit could derail talks.

Mudslide brings economic shock to area built on tourism

UK inflation to start slow down after Brexit

Meanwhile, inflation in the UK may finally be starting its slowdown, bringing some small relief to consumers squeezed by faster-rising prices in 2017. Consumer-price growth eased slightly to 3 percent last December, according to a Bloomberg survey of economists last Tuesday, which would mark the first decline in the rate in six months. The Bank of England has forecast that it will continue to cool through 2018, though at a moderate pace. Boosted by the pound’s drop after the UK’s 2016 vote to leave the EU, inflation reached 3.1 percent last November, a level not seen in more than five years. Wage growth has failed to keep pace even with unemployment at a 42-year low, draining consumers’ spending power and sapping a key driver of economic growth. The rate was also more than a percentage point above the Bank of England’s (BOE) target, meaning Governor Mark Carney must write a letter to Chancellor of the Exchequer Philip Hammond explaining why this is the case. That will be published alongside the bank’s February policy decision, when it will also unveil new economic projections and crucial research on the supply side of the economy. Bloomberg News

Monday, January 15, 2018 A9

Search and rescue personnel scan a home in the aftermath of a mudslide last Saturday in Montecito, California. Most of the people of Montecito, a town usually known for its serenity and luxury, were under orders to stay out of town as gas and power were expected to be shut off last Saturday for repairs. AP/Marcio Jose Sanchez

ANTA BARBARA, California— The California mudslide that killed at least 19 people is causing distress miles from where the torrent of muck and boulders stopped, as a local economy that thrives on tourism and the lure of sun-soaked beaches was left reeling.

On a postcard-perfect afternoon, the Santa Barbara Shellfish Co. would normally be bustling with lunchtime diners, downing fried calamari and lobster tacos, especially on the cusp of a holiday weekend. “We would be smashing right now,” said Manager Sean Johnson, referring to a typical Friday crowd at the restaurant on the edge of Santa Barbara Harbor. But w ith the 101 Freeway clogged by mud and debris, cutting

off traffic from Southern California, “There is hardly anybody in here,” Johnson lamented. “The big hit,” he said, “is people can’t get up here from LA.” As searchers continued to look for bodies in the thick mud and evacuations remained in effect, the economic damage ranged up and down the coast, far from where the mudslide ravaged the celebrity getaway of Montecito. In affluent Summerland, just east

of where the mud flow cut a swath through homes and businesses alike, a liquor store with its door open was a lonely outpost. Restaurants and hotels were dark in Montecito, where 65 homes were destroyed, hundreds more damaged and power and water shut off. The historic San Ysidro Ranch, where President John F. Kennedy and his wife honeymooned, was heavily damaged. Santa Barbara is a tourist magnet, attracting visitors to its famous beaches and trendy restaurants. But last Friday there were plenty of seats at eateries, pedestrian traffic was unusually light and parking spaces were often empty. Mark Schniepp, director of the California Economic Forecast, said the area is being shaken by a threepronged problem: Tourists aren’t coming in their usual numbers, residents have been forced to move out and thousands of workers can’t get to their jobs. He said some 12,000 daily commuters drive into Santa Barbara

from the south, a route now blocked. Those people aren’t buying lunch or coffee, or filling up the gas tank on the way to work. Residents are uprooted, the dollars they would pump into the economy gone with them. January is not high tourism season in Santa Barbara, but now-closed seaside hotels typically lure crowds throughout the year. Making matters worse, the area recently witnessed a monster wildfire that torched homes and sent clouds of ash and smoke into communities. Meanwhile, beaches were closed to swimming, after health officials said mud and runoff from heavy rains contained unknown amounts of sewage and contaminants. “The stigma that we have right now, it’s flooded, it’s burned, there is mud everywhere. That is not going to be helpful with tourists,” Schniepp added. The economy will eventually recover, starting when the freeway reopens, possibly as early as Monday. “Once the freeway opens up, fingers crossed, we are counting on bouncing back,” said Johnson, the restaurant manager, who has had to cut back on workers in the meantime, while dealing with delayed produce deliveries. But it’s not known when many residents in Montecito can return, and widespread damage is likely to take months or longer to repair. Ken Oplinger, who heads the Santa Barbara Region Chamber of Commerce, said the combination of the wildfire and the mudslide could doom some smaller businesses. The threat, when tourists stay away: “You just don’t have the cash flow to continue,” he said. Patrick Casey, owner of the State and Fig restaurant in downtown Santa Barbara, said he’s worried but expressed confidence that his business, and the community, will snap back. During the fires, the restaurant lost holiday parties and customers, but they made adjustments. If needed, they will again, he said. “This whole experience has been humbling,” Casey added. “We’re really hoping once the dust settles, there will be new life here.” AP

Racial firestorm surrounds Trump at MLK holiday Japan enters cooperation pact with Baltic countries A

TLANTA—The first Martin Luther King Jr. holiday of Donald J. Trump’s presidency is taking place amid a racial firestorm of Trump’s own making. In the same week that he honored King by making a national park out of the ground where King was born and preached until his death, Trump denigrated practically the entire African diaspora and left many Americans headed into the civil-rights icon’s birthday convinced that the leader of their country is a racist. For African-Americans, this latest insult from Trump felt like whiplash. Barely a year ago, America’s first black president, Barack Obama, marked his final King Day in office with his usual community service; now, his successor is presiding over a racial backlash the country has hardly seen in more than a generation. Trump has denied being racist, labeling himself the “least racist person there is” during his 2016 campaign. Some of his actions leading up to this year’s federal holiday honoring King’s birth seemed to be an attempt to live up to that. He began last week by designating the historic site around King’s Atlanta birth home as a national park. By week’s end, Trump was signing a King holiday proclamation with the martyred activist’s nephew at his side. But in between, the president sat in a White House meeting on immigration policy and denigrated much

of the African diaspora as “shithole countries,” while expressing a preference for immigrants from Norway, a majority white nation. This is the type of thing, activists, religious leaders and scholars say, that puts Trump’s presidency in direct conflict with the legacy of King, who was assassinated on April 4, 1968, while trying to make America a more inclusive society. King’s daughter, the Rev. Bernice King, will be the keynote speaker at the commemorative service honoring her father at Ebenezer Baptist Church in Atlanta. As is the custom for most presidents, Trump is not expected to participate, but she does hope he will observe the holiday. “This is what I would like President Trump to do: Don’t let the King Holiday find you using your Twitter account in an inappropriate way,” Bernice King told The Associated Press in an interview. “If he can dare to do that, I would be proud on that day that our president honored Dr. King by not doing things that are offensive.” Much of Trump’s first year as president has been marked by racial controversy. Last February Trump kicked off Black History Month by praising long-dead abolitionist Frederick Douglass in the present tense, as if Douglass were still alive. He referred to National Football League players protesting systemic racism as “sons of bitches” and sug-

gested they should be benched or fired for their refusal to stand during the national anthem. During a speech to African leaders last fall, he referred to the nonexistent country of “Nambia” when attempting to discuss Namibia. Last June he said Nigerian immigrants would “never go back to their huts” after coming to the United States. King’s son, Martin Luther King III, met with Trump on the last King holiday, four days before Trump took office. He spoke to the then-president-elect about the importance of voting rights—only to see Trump establish a now-defunct commission to investigate voter fraud, which some saw as a move to intimidate minority voters. “I would like to believe that the president’s intentions are not to be divisive, but much of what he says seems or feels to be divisive,” King told the Associated Press in an interview. “It would be wonderful to have a president who talked about bringing America together and exhibited that, who was involved in doing a social project...that would show humility.” Civil-rights leaders said last Friday that the president’s comments are not new, but are the most recent and glaring proof of Trump’s racist views and shocking to the point that congressional leaders and Americans can no longer ignore his bigotry. “The Trump era...is a direct assault on the legacy of Dr. King,” said

the Rev. Raphael Warnock, pastor of Ebenezer, where King preached for the last eight years of his life. “The conversation about who we are as Americans has shifted and given in to a kind of xenophobia that makes it difficult to discuss issues that affect all Americans.” New Jersey Sen. Cory Booker, who is in Atlanta this weekend being honored by The King Center for Nonviolent Social Change, said “my soul has ached” during Trump’s presidency. But Booker, one of two black senators, said Trump’s critics must mobilize against his policies or risk being consumed by their own hurt and anger. Paraphrasing King, Booker said, “The problem today is not the vitriolic words and violent actions of the bad people, but the appalling silence and inaction of the good people.” During the civil-rights movement, King directly confronted and exposed the ills of racism, and led a movement that pressured the American government to end legalized segregation. He spent the last year of his life condemning what he called the “triple evils” of racism poverty and war. Bernice King, who serves as the King Center’s chief executive, said the lesson of nonviolence is to focus on defeating injustice, not individuals. She said her father’s life and work should be applied to the current moment, where racism has again come out into the open. AP

ALLINN, Estonia—Japan’s prime minister said last Saturday that his country has entered into a pact with Estonia, Latvia and Lithuania to boost economic and political ties with the three former Soviet republics. Japanese Prime Minister Shinzo Abe and Latvian Prime Minister Maris Kucinskis said after meeting in Riga, Latvia’s capital, that information technology, transportation and medicine are areas where Japan sees the most trade potential in the Baltic countries. Abe praised the cargo harbor in Riga as “a successful center of transportation and logistics” that will allow Asian suppliers to deliver goods to the region. The four-way Japan-Baltics trade pact is likely to yield benefits for Tokyo only once a larger partnership deal between the European Union (EU) and Japan has been ratified. Abe, accompanied by a sizable Japanese business delegation, and Kucinskis both urged rapid ratification of the EU-Japan trade deal reached last December. “I am glad that economic partnership treaty negotiations between Japan and the European Union have been concluded,” Abe said, referring to the free-trade

agreement that will open EU markets, such as Estonia, Latvia and Lithuania to Japanese companies and vice versa. Latvia is the second leg of Abe’s six-nation European tour that started in Estonia last Friday. Abe is scheduled to also visit Lithuania, Bulgaria, Serbia and Romania. He is the first sitting Japanese prime minister to ever visit those countries. Abe arrived in Lithuania last Saturday afternoon to meet with President Dalia Grybausakaite and Prime Minister Saulius Skvernelis, and to honor a late Japanese diplomat based in Lithuania during World War II. Chiune Sugihara is credited with helping save about 2,500 European Jews in 1940 by issuing them travel visas. Abe said he discussed with Lithuanian leaders closer cooperation between the Baltic states and Japan in the areas of defense, economics and cybersecurity. He also thanked Lithuania for its support amid the tension over North Korea’s missile tests. “We have to increase our cooperation in this field to increase pressure on North Korea and condemnation of its actions” he said. AP

A10

The Regions

Monday, January 15, 2018 • Editor: Efleda P. Campos

BusinessMirror

www.businessmirror.com.ph

DENR to host first-ever ‘land summit’

By Jonathan L. Mayuga @jonlmayuga

ROUND 400 officials and representatives from various national government agencies, the private sector, civil-society groups and other stakeholders are expected to take part in the first-ever National Land Summit this month to ensure synergy and cooperation among the land management and titling agencies in the Philippines.

To be hosted by the Department of Environment and Natu ra l R esou rces ( DEN R), t he participants will discuss issues and initiatives of the land-management sector and create valuable partnerships. It will be held on January 16 and 17 at the historic Manila Hotel with the theme “Forging Stronger Alliances and Bridging Networks.” There are three main titling agencies in the Philippines—the Department of Agrarian Reform, the Land Registration Authority and the National Commission on Indigenous Peoples. Environment Secretary Roy A.

Cimatu is hopeful the summit will help address the complexity and other problems associated with land ownership with concerned government agencies working together to make land titling easier and faster. Cimatu said improved land administration and management is one fo the major programs of the DENR this year. “This first-ever land summit signifies our strong commitment to implement this program and bring it to fruition,” he said in a statement. Social justice in land titling is also among the five priority programs that shall be adopted

by the Program for Environment and Natural Resources for Restoration, Rehabilitation and Development (PRRD) of the DENR chief to address issues regarding the environment and natural resources and pursue the thrusts of the Duterte administration. Cimatu said the event is pursuant to Ambisyon Natin 2040, which represents the collective long-term vision and aspirations of the Filipino people for themselves and for the country in the next 25 years. High on their wish list is owning a medium-sized house in a lot registered under their names. Cimatu said the government aims to achieve this by providing tenure security through land ownership and formal titles. “Land titling is an issue that has hounded our country’s land sector for the longest time because of the number of agencies involved in the land-titling process,” Cimatu said. “We hope to solve this and create synergy among the concerned offices to make land titling faster and easier.” The upcoming land summit supports Agenda 6 of the Duterte a d m i n i s t r a t i o n ’s 1 0 - p o i n t socioeconomic agenda, which aims to “ensure security of land tenu re to encou ra ge i nvest ments and address bottlenecks in land management and titling agencies.” “Security of tenure is sacred for every Filipino and only a land title will seal ownership of it whether it is for personal or business use. The DENR is hitting hard on its goal to legitimize land ownership,” Cimatu said.

Davao firm holds memorial service for 37 colleagues lost in deadly fire

AVAO CI T Y—Research Now SSI held a memorial ser v ice for Davao employees at the site of the NCCC Mall to honor the 37 employees who perished in a fire at the site on December 23, 2017. Rick Watson, the company’s United States-based global vice president for operations; and Alan Superfine, the company’s Computer-Assisted Telephone Interviewing business general manager, were present. They were joined by family members of those lost in the tragedy. Held on January 11 in Davao, t he ceremony st a r ted at 10

a.m., the approximate time the fire broke out, and began with a prayer and a blessing, after which the families placed the names of their loved ones on memorial wreaths. “On behalf of the entire Research Now SSI family, we express our profound sorrow over the passing of our 37 colleagues and offer our condolences and prayers to their family members and loved ones,” Watson said. He thanked the company's Davao employees for t heir courage and steadfastness. “Your strength and resilience serve as an inspiration to us dur-

ing this difficult time,” he added. Research Now SSI is the global leader in digital research data for better insights and business decisions. The company provides worldclass research data solutions that enable better results for more than 3,500 market research, consulting, media, health care and corporate clients. Research Now SSI operates globally with locations in the Americas, Europe and Asia Pacific, and is recognized as the quality, scale, and customer satisfaction leader in the market research industry.

‘BAYANIHAN’ IN THE FARM Farmers in Pugo, La Union, harvest palay as a group during the first month of the new year. MAU VICTA

Nonperforming local chief executives in ARMM warned By Manuel T. Cayon @awimailbox Mindanao Bureau Chief

AVAO CIT Y—Absentee and nonperforming local chief executives have been warned anew, and reminded their inaccessibility and absence commonly fuel discontent on government due to the nondelivery of basic services. “ T his situation presents a very serious concern as the lack of basic services leads to a genera l d issatisfaction w ith the government, which has been determined to be one of the leading causes for indiv iduals to join rebel or extremist groups,” Defense Secret a r y Del f in N. Lorenzana said. The warning was raised across the Autonomous Region in Musl i m M i nd a n ao ( A R M M ) l a st Thursday as Gov. Mujiv Hataman warned he would impose sanctions on erring local mayors and provincial governors. His war ning came after Lorenzana, who serves as martial-law administrator in Mindanao, ordered a closer monitoring of local chief executives in Mindanao. The order was specified in Martial Law Instruction No. 1 that

Lorenzana issued on January 8. Lorenzana said the absence of local chief executives, “ in some cases, results in the total failure in the deliver y of v it a l ba sic ser v ices to t hei r constituents.” Hataman said Lorenzana’s order wou ld he lp deter m i ne who among the local chief executives were not performing their mandate. “Nonperformers will be revealed,” Hataman said in a news briefing in the Office of the Regional Governor in Cotabato last Thursday. In the past weeks, Hataman has been going around the five provinces of the ARMM to check on the implementation of government projects. This time, he said, he would be making “unannounced” visits to towns to check on the presence of local chief executives. “ T hese lo c a l c h ie f e xe c u tives were voted by the people. They should be in their offices,” he said. The ARMM is composed of the Central Mindanao provinces of Lanao del Sur and Maguindanao, and the southwestern island provinces of Basilan, Sulu and Tawi-Tawi. Terror activities have been

noted in the Maguindanao and Lanao areas with the government point ing at t he Maute Group and the Bangsamoro Islamic Freedom Fighters, and in Basilan and Sulu, with the Abu Sayyaf group. Martial law was first declared on May 23 last year, after fighting erupted in Marawi City. Notwithstanding the end of the fighting in October last year, the ARMM said military and police intelligence sources “claimed that extremist groups were still recruiting new members in various parts in Mindanao.” Last month, upon the recommendation of the security sector, lawmakers voted to extend martial law for a year. Lorenzana’s instructions said t he m i l it a r y, t he pol ice a nd other law-enforcement agencies should assist the ARMM governor and provincial chief executives in the monitoring of the local government executives’ presence in their areas of authority. “At the end of each month, regular compliance and evaluation reports are to be consolidated at the provincial level and submitted to the Office of the Martial Law Administrator,” the instruction letter noted.

Malay, Aklan, mayor defends resort project in Boracay Island By Jun N. Aguirre Correspondent

SLOWDOWN MARKER A man paints a road-warning sign on a recycled truck tire along a national highway in front of a school in Isabela.

LEONARDO PERANTE II

OR ACAY ISLAND, Malay, Aklan—Malay Mayor Ciceron Cawaling is defending a resort project at Puka Beach located in Barangay Yapak of this resort island. This developed after a Facebook account posted photos of the alleged irregularities in the construction of the hotel owned by the Seven Seas Boracay Property Inc. (SSBPI). Cawaling said it immediately conducted an investigation and asked SSBPI officials for comment. “ The project manager of the

SSBPI said the construction of precast concrete panels and sand bags were a preemptive preparation against Ty phoon Agaton, which struck the Philippines on Januar y 2 this year,” Cawaling said in a letter dated Januar y 10. Many resorts in Boracay have undertaken massive preemptive preparation after earlier Typhoon Urduja f looded this resort island in December 2017. “We also conducted an inspection and we were able to prove the SSBPI has complied with the local ordinance and environmental laws, especially the 25+5 easement regulation in Boracay prior to

their construction,” Cawaling added. T he SSBPI has lamented that the trending photos of the constr uction at Puk a Beach was ta ken in an angle that does not show the whole constr uction of the per imeter. The Puka Beach was named by the Trip Advisor recently as one of the 12 crystal-clear beaches in the world. In 2013 CNN also named Puka Beach as one of the three most beautiful beaches in the country. For the islanders or local residents, Puka Beach was being considered as the last bastion of underdeveloped Boracay.

The Regions BusinessMirror

www.businessmirror.com.ph

Monday, January 15, 2018 A11

Australia looking to invest more in Clark, Cebu

By Elijah Felice E. Rosales

@alyasjah

HE government’s push to develop major urban centers outside of Metro Manila is beginning to pay off, with Australia announcing its intent to pour in more investments in Clark, Pampanga and Cebu City this year.

POSTHARVEST AT THE CORN CAPITAL

Taking advantage of the rare sunny weather, farmers in Isabela rush the threshing of their corn harvest. The erratic climate condition in the area is a major problem in the province, said to be “The Corn Capital of the Philippines.”

LEONARDO PERANTE II

Ayala industrial parks in Porac, Pampanga to generate 7,000 jobs By Joey Pavia | Correspondent

ORAC, Pampanga—The two industrial parks of Ayala Land Inc. (ALI) here will generate at least 7,000 jobs once operational, a high-ranking ALI official said last Friday. ALI President Bobby Dy said the Alviera Industrial Park Phases 1 and 2 are part of the Ayala group’s P100-billon investment in the Alviera township project at Hacienda Dolores. Dy graced the groundbreaking ceremony for the Alviera Industrial Park 2 and the Standard Factory Buildings (SFB) last June 12. The area for the Phase 2 project is 32 hectares. It will have 22 SFB on each 1-hectare lot. Former President and now Second District Rep. Gloria Macapagal-Ar-

royo graced the event, together with Porac Mayor Condralito de la Cruz, Vice Mayor Dexter Albert David, Board Member Olga Frances David-Dizon and Masahiro Nagaoka of Mitsubishi Corp. In her speec h, A r royo e xpressed her support for the development of Alviera since day one and said “it was her joy” to attend another groundbreaking ceremony here. She also said the support of the local government is one of the most important components in the development of the investment climate in Pampanga. “I know that the governor is fully supporting this project and anything you need from her, whether it is regarding policy, troubleshooting or others, she is willing to help you with that,” she said.

De la Cruz said she is looking forward to the additional work opportunity that the Alviera will produce for the townsfolk of Porac. He also expressed his gratitude for ALI’s choosing his once-barren town for investment and making it into one of the most conducive towns for businesses. David said “not just Porac but the whole of Pampanga will benefit from the project of the Ayalas.” Dy said the land area of Alviera has already increased from the original 1,100 hectares to 1,800 hectares, which makes it their second-largest estate in the country. He added they are expecting the property to be the home for locators in food manufacturing, motorcycle assembly, packaging and logistics, as well as warehousing.

In an interview with the BusinessMirror, Australia Senior Trade Commissioner to Manila Elodie Journet said Australian firms are now gaining confidence in urban areas outside the Philippine capital with the rollout of the government’s infrastructure program, dubbed as the “Build, Build, Build” (BBB). She specified Clark as a potential market for Australian firms, especially for those in the business of food manufacturing and food processing. “[Aside from Metro Manila,] there are a lot of Australian companies that already have a presence in Cebu. Then in Clark, obviously, as we have a New Clark City, and we have already got about 60 or 70 Australian companies based in Clark,” she said. “There is already a large Australian presence there,” Journet added, referring to Clark. “Because of the developments and, obviously, the positive support of the Philippine government to really make Clark a

new hub in the country, we do foresee that this is going to be great eventually to invest in Clark, as well.” A number of infrastructure projects listed under the BBB program is located in Clark, including the Clark International Airport and New Clark City. “Clark will be an exciting one for us to actually invest in,” Journet said. She added it would be beneficial for both Manila and Canberra if the former carries on with its efforts to decentralize its capital and spur economic growth to the provinces. On top of this, she said it would accelerate the bilateral trade between the two countries valued at A$4.3 billion and Australia’s investment in the country totalling A$9.3 billion in 2016. President Duterte himself is excited about Clark’s potential as an investment hub that will attract industries and people to move out of Metro Manila.

6 Miascor workers axed, charged with theft By Ashley Manabat Correspondent

ABALACAT CITY—Six employees of ground handler Miascor, who were involved in luggage pilferage at the Clark International Airport (CIA), were charged before the Prosecutor’s office here last Friday. Miascor also filed separate charges of qualified theft against the same suspects who were terminated from their employment. “After a thorough investigation with the Clark International Airport Corp. [CIAC], we have served a notice of termination to our pas-

senger-service agents who admitted to pilfering the baggages of overseas Filipino worker Jovenil de la Cruz of Pandi, Bulacan,” said Herman Reyes, Miascor president. Three pieces of luggage and a box belonging to de la Cruz were looted inside the Miascor office at the CIA terminal. A source privy to the investigation said a closed-circuit television footage showed de la Cruz’s luggage arriving last December 24 being transferred by ground handlers intact. However, de la Cruz’s luggage was already looted when he claimed it on January 10. CIAC chief Alexander Cauguiran

Lake Mainit farmers, fishers get ₧8-M aid By Manuel T. Cayon Mindanao Bureau Chief

AVAO CITY—Lake Mainit in Surigao del Norte got a new buzz of encouragement as its farmers and fishermen received P8 million worth of “agrifisheries interventions” from the Department of Agriculture and Bureau of Fisheries and Aquatic Resources (DA-BFAR) last Friday. Agriculture Secretary Emmanuel F. Piñol also directed his office to extend P5 million in credit assistance to the lakeside municipalities, after a dialog with farmers and fisher families, the regional DA office said. The loan would be coursed through the Production Loan Easy Access (PLEA). The regional DA information office said the “agri-fisheries interventions” included 75 units of paddle boats, 50 units of motorized, fiberglass boats and three units of patrol boats “and other fishing paraphernalia for the lakeside municipalities.” These items were P4.7 million, the DA-Caraga office said. The regional office also distributed production support, which included rice seeds, farm inputs, planting materials, farm equipment,

and drugs and biologics for livestock amounting P1.7 million. The Philippine Fiber Industry Development Authority also gave abaca plantlets amounting to P1.2 million, while Philippine Crop Insurance Corp. released insurance checks amounting to P265,000, the information office added. D i st r ibut ion of f iberg l a ss boats was among the priority programs of the current DABFAR administration, and was tagged as the FB Pagbabago, or the Fiberglass Boats for Change. Other coastal communities have been beneficiaries of distributed boats since last year, and was done to support the livelihood fishing activities of the marginalized and artisanal fishermen. Piñol visited the Lake Mainit area last Friday and talked with farmers and fishermen from the lakeside municipalities of Lake Mainit in the part of Surigao del Norte, and of the Kitcharao and Jabonga municipalites in the side of Agusan del Norte. Also on that day, the BFAR gave an initial stock of 130,000 fingerlings in the 17,300-hectare Lake Mainit area. DA-Caraga Regional Director Abel James Monteagudo, BFARCaraga Regional Director Dr. Juan

“Clark is a very important destination now for the Philippines,” the President said last December. Duterte said he hopes half of all the planned infrastructure in Clark will be completed before his term ends in 2022, as he wants to witness how the developing city will perform under better roads, facilities and an improved airport. “Clark is a very important arterial place [because it leads to the exit of] Luzon upward, and in the development of the area because it is very important that we disperse the industries,” the President said. Under Duterte, the government is bent on completing dozens of public infrastructure, such as the North Luzon Expressway Harbor Link, Luzon Spine Expressway, Philippine National Railway North and South Rails and the Metro Manila Subway. It intends to achieve this dream by increasing the country’s infrastructure-to-GDP ratio by 7.4 percent, which is expected to amount to as much as P9 trillion by the end of the President’s term. The government has so far allocated P3.6 trillion for its infrastructure program, most of which for transportation and connectivity projects in Metro Manila and other major urban centers. Aside from the annual budget, the BBB program will also rake in 70 percent, or P84.84 billion, of the expected revenue of P121.2 billion from the new tax law.

said he personally confiscated the IDs and access passes of the six Miascor employees, four of them female, and directed CIAC authorities to prohibit the suspects from entering airport premises. “Thievery has no place in CIAC, whether those involved are airport staff, ground handlers or contracting parties. Let this filing of criminal charges be a warning to all,” Cauguiran said. Miascor is the ground handler under contract with airlines that service flights in Clark and handle the luggage of passengers. Last Wednesday Miascor compensated de la Cruz for the stolen items in his luggage amounting to P82,824.

1 dead, 4 missing in Tacloban landslide

CRUISING MAGAT RIVER

A passenger boat sails the deep waters of the Magat River in Ramon, Isabela, to the other side of Cordon town. The only way to reach other riverside villages is through the dam’s reservoir. LEONARDO PERANTE II

D. Albaladejo and Mayor Crisanta O. Mondano lead the ceremonial disperal of the first batch of fingelings for this year. Last year the BFAR-Caraga dis-

persed 403,820 bangus and carp fingerlings along the lakeside municipalities of Lake Mainit. The dispersal of fingerlings was one of the major components

of the Balik Sigla sa Ilog at Lawa, a program of the DA-BFAR which aims to repopulate and bring back the integrity of the country’s lakes and river systems, the DA said.

ACLOBAN CITY—At least one person was confirmed dead while four others went missing after a landslide collapsed a wall and buried houses along one of the city’s major thoroughfares last Saturday night. Mayor Cristina Romualdez said the mudslide collapsed a concrete wall and buried several houses along Cong. Artemio Mate Avenue in the Quarry district here past 9 p.m. last Saturday. Citing initial reports from rescuers, the mayor said one was confirmed dead, while four others were still missing, including a village secretary and a village watchman. “This is very unfortunate. After this incident, we immediately evacuated villagers near the landslide area to ensure safety,” Romualdez said in a media interview. The mayor led the city disasterrisk reduction management council in the conduct of search, rescue and retrieval operation. The regional capital has experienced heavy rains last Saturday due to the tail end of a cold front, which triggered flooding and landslide. PNA

Green Monday BusinessMirror

A12 Monday, January 15, 2018

www.businessmirror.com.ph â€˘ Editor: Lyn Resurreccion

Visitors wander around the National Wildlife Rescue and Research Center (NWRRC).

A monkey and a white-breasted sea eagle are among the rescued wildlife sheltered at the NWRRC.

Biodiversity Monday BusinessMirror

Asean Champions of Biodiversity Media Category 2014

Monday, January 15, 2018 A13

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

Solution to be deployed in Southeast Asia heritage parks

Smart, Asean biodiversity center pilot app-based monitoring system

n application is now available that could be used in monitoring and recording biodiversity information. Uploaded in smartphones, it is aimed that the data gathered would help improve analysis of ecological information. PLDT w ireless unit Sma r t Communications Inc. and the Asean Centre for Biodiversity (ACB) have signed an agreement to deploy an environmental monitoring system in Asean Heritage Parks (AHPs). Called as Biosentinel, the pioneering monitoring system is an intelligent and user-friendly solution that can monitor and analyze ecological information. It will be piloted in the Philippines at Mount Makiling Forest Reserve, in partnership with the Makiling Center for Mountain Ecosystems. Mount Makiling Forest Reserve was named an AHP in 2013. AHPs are protected areas known for their unique biodiversity and ecosystems, wilderness and out-

standing values. Biosentinel has three components. First, its dashboard allows authorized users to set up and define conservation areas, designated patrollers, f lora and fauna archives and possible ecological threats. Second, the Biosentinel app can be used by local personnel as they patrol around their areas. Using the data generated by the dashboard and uploaded onto smartphones, the patrollers can record any relevant wildlife, threat or geographical information. Authorized users can use the app to store information, eliminating the need for manual record-keeping, which is prone to loss or damage.

Smart Communications, Asean Centre for Biodiversity (ACB) and applications developer Instigators recently sign a memorandum of agreement for the use of the Biosentinel environmental monitoring system, at ACB headquarters in University of the Philippines Los Baños. In the photo are ACB Information Management Director Sheila Vergara (from left), Instigators developer Dominic Tuazon, ACB Executive Director Roberto Oliva, PLDT-Smart Public Affairs Head Ramon R. Isberto, Makiling Center for Mountain Ecosystems Deputy Director Rogelio Andrada and Smart community Partnerships Senior Manager Nova Concepcion.

Third, the Biosentinel analytics data software is where information collected from the app users is uploaded and analyzed. The system was developed by Instigators, a team of app developers that won in 2014 the grand prize at “Hack the Climate: Mani la,” which was supported by Smart. T he w i n n i n g p r o j e c t w a s

ca l led Tanaw, an application that promoted awareness, tracked reforestation sites and helped sustain loca l communities through ecotour ism. A ccord i ng to AC B I n for mation Management Director Sheila Vergara, the Asean organization is engaging in this collaboration to facilitate data collection in AHPs.

Target: A biodiversity-friendly mining ‘from cradle to grave’ By Jonathan L. Mayuga

@jonlmayuga

he Department of Environment and Natural Resources (DENR) is eyeing to close the mining-policy gaps to make the highly extractive industry ecologically sound and biodiversity-friendly “from cradle to grave.” Director Theresa Mundita S. Lim of the DENR’s Biodiversity Management Bureau (BMB) said a review of existing policies aims to identify the gaps and come up with recommendations to enhance biodiversity protection and conservation efforts despite mining. Environmental advocates oppose large-scale mining, particularly those that operate surface or open-pit mines, because they are destructive and threaten the extinction of unique flora and fauna. “Right now, there’s an ongoing policy review on biodiversity and mining. Our previous assessments are being reviewed, but initially, there appears to be policy gaps that need to be addressed,” Lim told the BusinessMirror in a telephone interview. According to Lim, the review is jointly being conducted at the technical level at the BMB and the Mines and Geosciences Bureau (MGB), which regulates the mining sector. In the ensuing weeks, a meeting at the director level will be held, noting that the review was ordered by no less than Environment Secretary Roy A. Cimatu The final output of the policy review, Lim said, would hopefully harmonize existing mining and biodiversity protection and conservation policies, either through a department administrative order (DAO) or an executive order (EO) in the short term and through acts of Congress, or a law, in the long term. The biodiversity component, even the measures for its safeguard

under Republic Act 7942, or the Philippine Mining Act of 1995, remained wanting, Lim added. The official is referring to the environmental compliance certificate process and environmental impact assessment (EIA) system, a requirement under Presidential Decree 1856, or the EIA law. “The policy is very general. Not specific [when on biodiversity]. For instance, in terms of flora and fauna, or even in marine ecosystems, the conditions are sometimes not specific. Even the checklist under EIA is not specific,” Lim added. She noted that an EIA study should not be confined to the mining tenement, whether it is overlapping a declared protected area. She said the EIA should determine the potential impact of mining to nearby ecosystems, such as forests, lakes, rivers, caves or coastal and marine areas. She insisted that a thorough biodiversity assessment should be conducted to establish a baseline data of the species of plants and animals that may potentially lost in the area. “The current policy [in conducting EIA study] focuses whether the mining site is within or outside a protected area. It should also consider if there’s a nearby important ecosystem that may be damaged, or biodiversity that may be lost as a result of mining operations,” she said. She lamented that mining companies are sometimes reluctant to consider the impact of its operation to important ecosystems nearby or the conservation status of the plant and animal wildlife found in the would-be affected ecosystem. “They should also consider, for instance, its impact on marine ecosystems. Are there corals that are unique to that area? Are there caves nearby? Is there an important ecosystem even if it is not within a protected area?”

she added. Globally, she said mainstreaming of biodiversity in development activities is already picking stride. According to Lim, in the next Conference of Parties to be held in Egypt in November, there will be a global guideline on mainstrea ming of biod iversit y to ensure business continuity or sustainability. “Hopefully, in the Philippines, instead of waiting for it [global guideline], we should start to consider biodiversity [in mining projects],” Lim said. “We have a very limited space, yet it has a lot of resources that need to be protected or exploited in a sustainable manner,” she added. According to Lim, the policy review should be able to find ways to strike a balance between environmental and biodiversity protection, on one hand, and exploitation of mineral resource on the other. “ The study should be comprehensive. A complete baseline information on biological resources, mineral resources and potential socioeconomic impact are needed to be able to strike a balance. That way, we can also identify possible trade-offs or set limits as to the level of development we can do without necessar ily sacr if icing biodiversity and intergenerational equity,” she said. Lim explained that intergeneration equity means present and future generations should continue to benefit from whatever natural wealth there are to exploit, which goes beyond the current benchmark of gunning for social equity here and now. “When you say there should be intergeneration equity, the present and future generation will have equal opportunity from the resources,” she said. According to Lim, current talks between the BMB and the MGB are looking at possible areas for

convergence. Mining companies, she said, shou ld work w it h t he DENR through the MGB and BMB to prove that they are rea l ly committed to responsible mining. “Since they are talking about responsible mining, then they should prove that there really is responsible mining. They have to work with us,” she pointed out. According to Lim, the DENRBMB can help during the conduct of progressive mine rehabilitation. She added the MGB should start working on a tighter policy to ensure that the state—which owns the mineral resources being exploited—will not be on the losing end of the deal with mining companies. “On the part of the BMB, the participation should be from cradle to grave to ensure that biodiversity is integrated in every aspect of mining operation,” she said. It could be recalled that the Chamber of Mines of the Philippines, which represents the country’s big players in the mining industry, has affirmed its commitment to responsible mining with the adoption of Canada’s Toward Sustainable Mining Initiative and the Baguio Declaration. Two of the country’s mining companies—Rio Tuba Nickel Mining Corp. (RTNMC), a wholly owned subsidiary of Nickel Asia Corp., and OceanaGold Philippines recently gained recognition for bagging the top awards in the first Asian Minerals Awards. RTNMC bagged the award in the Best Mineral Mining category, while OceanaGold won the top prize in the Mineral Processing category. The awards gave recognition to mining firms from the 10-member Association of Southeast Asian Nations that are following best practices. Both award-winning mining companies boast of ecologically sound mining practices.

“ The Biosentinel system will help enable the recording of biodiversit y infor mation and i mprove d at a a n a ly si s,” she said dur ing the sig ning of the memorandum of agreement at the ACB headquar ters in Universit y of the Philippines, Los Baños, Lag una. The partnership also aims to guide policy-makers by help-

ing ensure that their decisions are based on facts and available data, ACB Executive Director Roberto Olivia said. “This project aims to contribute to global sustainability by enhancing environmental wellbeing. The specific objective is to enhance conservation of biodiversity and effective management of forest areas in Southeast Asia,” Oliva added. Smart Public Affairs Head Ramon R. Isberto emphasized the role of technology in environmental conservation. “The core of our communityservice programs is called tech for development. We try to search for every opportunity to use mobile phones and digital technology to address issues and problems, one of which is environment protection. The Biosentinel system makes it easier to gather information, which is important in guiding and directing the activities that we do, especially in forest conservation,” Isberto said. A s pa r t of t he compa ny ’s “tec hnolog y for development ” initiatives, Smar t suppor ts effor t s tow a rd e nv i ron me nt a l protec t ion b y i mplement i ng s olut ion s a nd col l a b or at i n g w it h pa r t ners.

Globe bags Platinum award for environmental, social and corporate governance

eading telecommunications firm Globe Telecom reaped another major accolade for its environmental, social and corporate governance (ESG) initiatives, winning the award for the sixth time in the past nine years. Globe again won the Platinum award given by The Asset Corporate Awards, the longestrunning ESG award-giving body in Asia. Globe Telecom won the Platinum award for the sixth time, having also won in 2016 and previously in 2014, 2013, 2010 and 2009. The award highlights the company’s consistent performance in its ESG efforts. The award is bestowed annually by leading research firm Asset Benchmark Research. “We are grateful for this recognition as we strive to manage our business impact while contributing to positive social change. Embedding sustainability practices in our business guide us in our decisionmaking processes to further improve our

service to Globe customers and delight our shareholders,” said Yoly Crisanto, Globe chief sustainability officer. The Asset Corporate Awards consists of three categories: Platinum, Gold and Titanium. It requires a rigorous benchmarking service for listed companies in the region in the area of corporate sustainability, which allows firms to join an exclusive and elite sphere of top corporations. The criteria for evaluating the companies include a wide range of metrics regarding financial performance, which is also a barometer for gauging management acumen. Companies are also evaluated according to the quality of their governance, social and environmental responsibility, and investor relations. Since its inception in 2001, the Asset Corporate Awards has enabled past winners to bolster their credentials to showcase their ESG efforts.

Republic Cement bags top award at environmental meet

epublic Cement’s Teresa, Rizal, plant site recently took home the Presidential Mineral Industry Environmental Award-Platinum Achievement Award for Quarry Operations at the recent 64th Annual National Mine Safety and Environment Conference in Baguio City. A highly distinguished award in its category, this honor is given to companies that have exhibited outstanding levels of dedication, initiative and innovation in working toward environmental protection, safety and health management and community development. The conference held recently in Baguio City was the biggest gathering in the mining industry that promoted and honored companies that have

furthered their efforts in occupational health and safety, sound environment management and community partnerships with local and national stakeholders. Apart from the Platinum Achievement Award for Quarry Operations, Republic Cement also took home the runner-up award for Safest Quarry Operation. The local government of Teresa, Rizal, endorsed the Republic Cement plant as a stop on the Miss Earth 2017 tour. During the visit, Miss Earth candidates pledged their support for Republic Cement’s safety and environmental advocacies. Republic Cement is a leading local cement manufacturing and distribution company in the Philippines with a nationwide footprint.

A14 Monday, January 15, 2018 • Editor: Angel R. Calso

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editorial

Bitcoin is racist

E live in an unfortunate time when words have lost meaning. It used to be that when a word was used incorrectly by a child, or a person ignorant of the true definition, it was our obligation to correct them. Language is a mathematical concept where words like numbers are specific and need to follow a set order to make sense.

Two must always mean exactly “two,” no more and no less. If not, then “two plus two equals four” is not a fact but an opinion. Words must have a strict and concise meaning to be able to express strict and concise ideas. However, we also know that some thoughts are abstract. Irish writer Margaret Wolfe Hungerford wrote in her 1878 novel Molly Bawn that “beauty is in the eye of the beholder.” United States Supreme Court Justice Potter Stewart wrote in 1964 to describe his threshold test for obscenity, “I shall not today attempt further to define.... ‘hard-core pornography,’ and, perhaps, I could never succeed in intelligibly doing so. But I know it when I see it.” A 2016 book titled The Politics of Bitcoin: Software as Right-Wing Extremism, which presents the idea that cryptocurrencies are, in part, a reaction to “big government” and central bank control of currency, they are, in fact, a reaction and result from right-wing extremist thinking. Of course, even “right wing” is a term used so often with so many meanings, the ideas behind the title could go in any direction, and they have. Now, some thinkers who identify themselves as “progressives”—whatever that means—are saying that Bitcoin is racist. “Racist” is normally defined as a situation or person that limits or discriminates against a person or group based on race. The problem is that there is no set definition of “race” either. We have come from the simplistic “black, yellow, brown and white” to identify our own race. Only in American progressive thinking could the logic of “Bitcoin is racist” come forth. “Bitcoin is supported by the political right. The political right is racist. Therefore, Bitcoin is racist.” However, if racist means something that is dominated by a particular racial group, then Bitcoin is definitely racist. In terms of total numbers of people who own and trade the cryptocurrency, Bitcoin is “yellow.” Measured by which national currency was used most often to purchase Bitcoin, the Chinese yuan account for an average of over 60 percent in the first three quarters of 2017. Since then, yuan volume has dropped to almost nothing. For the past two months, on any given day, it has been the Japanese yen or the South Korean won accounting for more than 50 percent of all transactions. The US dollar transactions—presumably from all those “white right-wingers” have been fairly consistent for the past year at about 30 percent. Sadly, not only is Bitcoin racist but it is also misogynist. Based on Google searches, 96.7 percent of all people looking for Bitcoin information are male. The one demographic truth about Bitcoin is that ownership and trading is limited to the higher economic classes. Unlike for the Philippine stock market—where even P5,000 can buy a person into a mutual fund investment—only the relative “rich” are getting richer in Bitcoin. Does that make Bitcoin anti-poor, too? Since 2005

As the new year begins Atty. Jose Ferdinand M. Rojas II

RISING SUN

N top of the things that many Filipinos have in their minds right now are the effects and repercussions of the new taxreform law. There are coffee-shop talks about how it’s going to affect earnings or salaries of ordinary workers, how much extra cash people need to shell out to cover price increases and even the effects on products and services that we regularly consume, like gas and small cars, salon treatments and soda.

But the story does not end there because on the heel of Tax Reform for Acceleration and Inclusion (TRAIN) is its second phase, Package 1B, which is still pending in Congress. This bill includes items, such as estate-tax amnesty and general amnesty, motor vehicle users charge adjustments and banksecrecy law adjustments. The government expects Package 1B to bring in an additional P38.9 billion to the revenues expected to be

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legally speaking

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for big changes along the way. nnn

While many of us are starting the year with a focus on the practical, financial aspects of living, there are also many among us who are putting energy into devotion and spirituality. One such group offers special devotion to the Santo Niño. As a predominantly Catholic country, the Philippines has many Santo Niño devotees. Therefore, festivals are popular in various parts of the archipelago—in Iloilo, Cebu and Kalibo, among others. The image of Jesus Christ as a child is close to the heart of the Filipinos, and they come to Him

Estate-tax changes under TRAIN law

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raised by the TRAIN law. After this, there are four more tax-reform packages (Packages 2, 3, 4 and 5) that will have to be passed to “meet the administration’s targets.” Apparently, we are in the face of a series of tax-reform packages that are meant to stabilize the government financially, but will definitely be rocking the boat for many sectors in the community. It’s a fresh year and we are off to a strong start; let us brace ourselves

We are in the face of a series of tax-reform packages that are meant to stabilize the government financially, but will definitely be rocking the boat for many sectors in the community. It’s a fresh year and we are off to a strong start; let us brace ourselves for big changes along the way.

N December 19, 2017, package 1 of the Tax Reform for Acceleration and Inclusion (TRAIN), otherwise known as Republic Act (RA) 10963, was signed into law.

The law made several amendments to the National Internal Revenue Code of 1997 (Tax Code), specifically on personal-income taxation, passive income, estate tax, donor’s tax, value-added tax, excise tax and documentary stamp tax. The law took effect on January 1, following its complete publication in the official gazette. Below is a brief discussion of the changes under estate taxation under the Train law. I. Amendment of the Estate Tax Rate Section 22 of the TRAIN law amends Section 84 of the Tax Code, which provides for the estate-tax rate. Previously, a tax based on the value of the net estate of the decedent, whether resident or nonresident of the Philippines, was computed based on a tax schedule where an estate worth P200,000 and over was taxed from 5 percent to 20 percent. Under the TRAIN law, it will now be subject to a flat rate of 6 percent. II. Amendments on Estate Tax Deductions Section 23 of the TRAIN law

amends Section 86 of the Tax Code, which provides for the computation of the net estate or, effectively, the deductions allowed to the gross estate of an individual. The TRAIN law removes funeral expenses, judicial expenses and medical expenses as allowable deductions. Instead, the law increases the Standard Deduction to P5 million, which previously only amounted to P1 million. Only available to citizens (resident or nonresident) and resident aliens, TRAIN law now provides that nonresident aliens can avail themselves of a standard deduction, although only up to P500,000. Another TRAIN law significant change from the old tax rule is that now, family homes that are worth up to P10 million will be exempted from estate tax. Previously, only family homes worth P1 million are exempted. III. Amendments on the Procedure for Estate Tax Settlement A. Repeal of Filing of Notice of Death provision

The TRAIN law requires that estate-tax returns showing a gross value exceeding P5 million must be certified by a certified public accountant. This is P3 million higher than the old tax rule, which only required CPA certifications for estate-tax returns that exceed a gross value of P2 million. The TRAIN law has also increased the period for filing of estate-tax returns from six months from the decedent’s death to one year. Section 24 of the TRAIN law repeals Section 89 of the Tax Code. The repealed provision provides for when a notice of death should be filed and the period to file the same. B. Amendment on Filing of Estate Tax Return Section 25 of the TRAIN law amends Section 90 of the Tax Code, which provides for the procedural requirements for the estate-tax return. The TRAIN law requires that estate-tax returns showing a gross value exceeding P5 million must be certified by a certified public accountant. This is P3 million higher than the old tax rule, which only required CPA certifications for estate-tax returns that exceed a gross value of P2 million. The TRAIN law has also increased the period for filing of estate-tax returns from six months from the decedent’s death to one year. C. Amendment of Payment of Estate Tax by Installment

for favors and petitions. In Manila a group called Congregacion del Santisimo Nombre del Niño Jesus has been around since 1979. Its founding chairman, an active Santo Niño devotee of many years, is the popular and innovative fashion designer Ben Farrales. The group was granted a pastoral blessing by then-Manila Archbishop Jaime Cardinal Sin. The Congregacion aims to propagate devotion to the Santo Niño— not only in the Philippines but also globally—by holding an annual exhibit of Santo Niño images, together with novenas and special processions. Through the years, various celebrities, beauty and fashion icons, and VIPs have participated in these religious events. This January the public is invited to join the procession of the images of the Santo Niño along Roxas Boulevard on the last Sunday of the month, the 28th of January, and every last Sunday of each month thereafter. The procession is being organized and sponsored by the Congregacion to honor the Most Holy Name of the Child Jesus.

Section 26 of the TRAIN law amends Section 91(c) of the Tax Code, which provides for the payment of estate tax by installment. Under the TRAIN law, payment by installment has been particularly simplified. However, the law has provided for an implied limitation of two years for the payment of the full estate-tax liability, which was previously not contained in the old tax rule. IV. Amendment on Withdrawals from Deceased’s Bank Account Section 27 of TRAIN Law amends Section 97 of the Tax Code, which concerns allowable withdrawals from the deceased person’s account. Under the old Tax Rule, only withdrawals up to P20,000 are allowed. The administrator of the estate or any one of the heirs may, when authorized by the commissioner, withdraw an amount not exceeding P20,000. However, the Train Law has increased allowable withdrawals from the deceased person’s account to any amount, subject to a 6-percent final withholding tax. The amendments on estate taxes were enacted with the end in view of enticing the heirs to declare the real value of their deceased kin’s estate and to pay the proper estate tax. Filing requirements have also been made simpler and filer-friendly. It remains to be seen whether collection of estate taxes will improve. But, as the saying goes, “You can bring the horse to the water, but you cannot force the horse to drink!”

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The making of a global professional

Do we suffer from ‘bureauphobia’? By Alberto Agra

PPP Lead

Kevin M. Aycardo

DEBIT CREDIT

T has been two years since I first set foot in New York City as an auditor. Now that my stint is over, the thought that I’ve thrived in one of the most challenging workplaces in the world gives me a deep sense of fulfillment.

Two weeks before I left NYC, I received an award from our practice of over 300 people (the Banking and Capital Markets group of Pricewaterhouse Coopers (PwC) New York, USA, as its 2017 Global Ambassador. The criteria said this award is “given to a professional that develops and operates with a global mind-set, embraces the dynamic business environment and celebrates inclusiveness and diversity.” The award led me to reflect upon the importance of global acumen in the workplace. My secondment (i.e., temporary reassignment) exposed me firsthand to what globalization means. My client in New York City is one of the biggest banks in the world, and its presence across five continents demonstrates how economic activities take place simultaneously and rapidly. It is astonishing how different cultures are linked together and work together every day. I have worked with client contacts who are based in different locations and timezones. My day would normally start with an 8 a.m. client call in Chennai, then another in Johannesburg, followed by a combined meeting between contacts in New York and London. We have also worked with counterparts in the United Kingdom, Singapore and South Africa to devise better audit approaches, as well as with our service teams in Kolkata and Tampa. As a professional from an emerging economy, I realize that globalization is real, and its reach, inevitable. Companies are now very diverse: In order to survive and advance in professional modern workplaces, developing global acumen is crucial. In fact, “global acumen” is among the Five Dimensions of the PwC Professional Framework, PwC’s global framework for defining and encouraging individuals to become leaders and professionals at all levels. Global acumen, according to PwC, is the ability to operate and collaborate effectively with a mindset that transcends geographic and cultural differences. A global citizen understands differences while working with diverse people—either culturally or geographically—to produce

the best results. In the regional front, the full integration of the Association of Southeast Asian Nation economies is expected to increase activity between our country and our Asian neighbors in the future. A flourishing Philippine economy changes economic power and demographics, which means that global acumen is necessary as Philippine corporations globalize themselves. From my point of view as a millennial, who has survived a two-year assignment in the concrete jungles of New York, these are my suggestions for improving one’s global acumen: Be a student of how the world works. Gear up for more knowledge by being curious on how the world works through reading, traveling, watching foreign films, studying other languages or a variety of other ways. This will help you learn about other cultures, standards of behavior, business practices and global trends. Use this as an opportunity to learn the similarities and differences between our culture and that of other cultures. For example, when I contacted someone from Chennai, I observed that they are very polite, both in e-mails and phone conversations. On the other hand, Americans, and particularly New Yorkers, are more straightforward and are not into long pleasantries—they just get straight to the point. I also had to prepare, every Sunday night, an answer to the “What did you do over the weekend?” question because, without fail, someone from the team will ask. I enjoy reading a lot. I read the morning news through business apps in my phone. During my commute to work, I first check what happens on the other side of the globe, then morning briefings and the top trends. I suggest subscribing to publications that you find interesting and that suit your profession, and read articles and books that help improve your cultural awareness. This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.

Continued from A1

hat is bureauphobia? According to Adizes, “bureauphobia is…induced by the environment we live in.” He admits “feeling the symptoms of bureauphobia” as he “look[s] at the papers (referring to IRA, tax and trust documents) and becoming paralyzed.” He asks, “How in the world can I fill out these forms and not make a mistake? And what will be the repercussions if I make a mistake?” He anchors his fear of the bureaucracy from the government’s intrusion into people’s lives and the resulting punishment for noncompliance with government impositions. What is the traditional meaning of bureaucracy? Max Weber lists the characteristics of a bureaucracy: Government agencies have fixed jurisdictional areas; are ordered by rules and regulations;

By Ross Douthat

ourteen months ago, in the first flush of power, Steve Bannon gave an interview to Michael Wolff—beginning a relationship that would prove his undoing—in which he boasted about his plan to realign our politics. His nationalist-populist movement, he argued, would transform the GOP into something truly new: a rightwing worker’s party that spent freely, “jacked up” infrastructure all over the country and won “60 percent of the white vote” and “40 percent of the black and Hispanic vote” on its way to a 50-year majority. “We’re just going to throw it up against the wall and see if it sticks,” Bannon said. “It will be as exciting as the 1930s.” As exciting as the 1930s is not a line you hear every day, but rather than an “alt-right” dog whistle. What I heard in Bannon’s formulation was the idea that, in the Trump era, as in the crisis years that gave

us both FDR and Hitler, everything might be up for grabs: not just electoral coalitions, but the nature and destiny of the liberal order. Which would be a terrifying prospect but also an exciting one, since it would mean that the long “end of history” that followed the Cold War had irrevocably ended, and that it was time to imagine radical revisions to a stagnant-seeming liberal West. Flash forward a year and a couple months, though, and Bannon’s vision seems pretty much dead: its rumpled leader sacked and ritually denounced, its bold populism subsumed into the same old, same old Republican agenda. Trump remains temperamentally authoritarian and personally vile, but the idea of Trumpism as an ideological revolution, whether akin to Roosevelt’s or Mussolini’s, has mostly evaporated. So, where does that leave the crisis of the liberal order that populism was supposed to bring upon us, both in America and Europe? One answer is that the crisis is still here, because the system of liberalism is failing,

have regular activities required, which are distributed as official duties; have the authority to give commands required for discharge of these duties; and have methodical provisions where regular and

Master of disaster Siegfred Bueno Mison, Esq.

THE PATRIOT

ased on some statistics of the National Disaster Risk Reduction and Management Council (NDRRMC), the government recorded 155 disaster casualties in 2015—a decrease from 295 casualties in 2014. In the words of Alexander Pama, who is now more known as an expert in disaster-risk reduction (DRR) than as a retired admiral in the navy, the decrease in the number is due to the cooperation of stakeholders, particularly those in the Office of Civil Defense, the NDRRMC, the media and the public at large. Pama noted that coordination before, during and after a disaster is crucial to proper disaster response and management. Enhanced coordination can be harnessed with the help of the media. For instance, Rappler initiated Project Agos, a platform that combines government action with civil society to help communities learn and help in disaster management. The project is more about sharing information among those affected and those who are willing to help and assist others during disasters. During the sixth Top Leaders Forum held November last year, the theme was “Business for Resilience: Towards a Resilient Philippines.” Various leaders from the business sector discussed ways of reducing disaster risks in the country. Most agreed that one of the major causes of disasters is

Is there life after liberalism? New York Times News Service

Monday, January 15, 2018 A15

My own response to Why Liberalism Failed was disappointment that its author did not go further. At the end, having delivered his indictment, Deneen declines to envision any alternate political order; instead, he rejects ideology and urges a rededication to localism and community, from which some alternative political and economic order might gradually develop. notwithstanding the ups and downs of its illiberal challengers. That’s the bracing argument of Patrick Deneen, a Notre Dame political theorist, in a book with the boldly retrospective title, Why Liberalism Failed. Deneen is a student of Alexis de Tocqueville, and part of his argument is classically Tocquevillian—that the liberal-

the fact that infrastructure, whether private or public, fails to include disaster risks in its planning. Resource persons in the forum shared that the Philippine government must solicit the participation of the private sector in integrating DRR in the planning of infrastructure projects, particularly during the “Build, Build, Build” infrastructure program of the Duterte administration. They mentioned the importance of adhering to the Sendai Framework, which promotes a shared responsibility between the government and the private sector when it comes to DRR. The newly created National Resilience Council (NRC) has adopted the world’s best practice of using a science-based approach to understand risks at the local government level. When science is connected to policy, risks are better identified and managed, which allows for a much better response during emergencies. The NRC will hopefully reinforce capacity-building efforts of local government resilience leaders and the introduction of sciencebased resilience metrics. A resource person in that forum, Rajib Shaw, a professor in Keito University in

democratic-capitalist matrix we all inhabit depends on its livability and sustainability and decency upon preliberal forces and habits, unchosen obligations and allegiances: the communities of tribe and family, the moralism and metaphysical horizons of religion, the aristocracy of philosophy and art. But Deneen comes as a Jeremiah to announce that Tocqueville’s fear that liberalism would eventually dissolve all these inheritances, leaving only a selfish individualism and soft bureaucratic despotism locked in a strange embrace, may now fully be upon us. Where it once delivered equality, liberalism now offers plutocracy; instead of liberty, appetitiveness regulated by a surveillance state; instead of true intellectual and religious freedom, growing conformity and mediocrity. It has reduced rich cultures to consumer products, smashed social and familial relations and left us all the isolated and mutually suspicious inhabitants of an “anti-culture” from which many genuine human goods have fled.

continuous fulfillment of these duties are performed. IAs have a broad or limited functional or territorial jurisdictions. No two IAs are alike. In the Philippines we have agencies focused on a particular territory and those focused on water distribution, reclamation, ports, airports, power and economic zones, among others. How does PPP fit in the bureaucracy? For PPPs, the traditional notion of a bureaucracy is still relevant. An IA can only pursue a PPP project if it is consistent with its mandate, undertaken based on set rules and procedures and executed by responsible officials. IAs cannot violate their respective charter and laws. For example, the Philippine Ports Authority cannot enter into a PPP for an airport, while Makati City cannot have an arrangement with a PSP for a monorail in Mandaluyong City. How must we view the bureaucracy? An IA must be seen as both an institution and also an

instrument. IAs must perform their mandate with the end in view of serving the people. IAs must work toward a better quality of life for Filipinos. But IAs may need to go beyond their walls and work outside the box, without violating any law. Entering into a PPP with a PSP is one way by which an IA, which is still part of the bureaucracy, exercises flexibility and assumes an external focus. Through the PPP, the IA becomes a market and network organization, as described by Johan Olsen. The IA engages the market, enters into a commercial contract with a PSP, and the relationship is governed by said contract. The partnership calls for an exchange of resources, sets the performance measures, and allows for innovation. For a PSP to partner with an IA, it must know, trust and not fear the government. For our sake, we must overcome bureauphobia while making IAs responsible and responsive.

Disasters, whether natural or man-made, are inevitable. Some can be prevented with proper planning and preparedness. Others, though foreseeable yet unavoidable, can result to lesser casualties and damage with timely and coordinated recovery efforts. Admiral Alexander Pama, the master of disaster, and Ricardo Jalad, his successor at NDRRMC, will need a holistic approach and a team effort to minimize casualties and damage during disasters.

economy, citing efforts in the energy-and transport sector transformation (e.g., renewable energy in small island grids), the use of low-carbon infrastructure building and more capacity-building activities in green skills development through linkages, among other areas. In his exit interview a few years ago, Pama mentioned the need to look at DRR not only as a way of life but also as a philosophy of resilience for all Filipinos. We Filipinos are known for our resilience, which means facing life’s difficulties with courage and patience —refusing to give up. It is the quality of character that allowed Pama to be a master of disaster. He simply made the most of what was given to him and focused on what he had instead of what he did not have. In the Bible, Philippians 2:3-4 tells us, “Do nothing out of selfish ambition or vain conceit. Rather, in humility, value others above yourselves, not looking to your own interests but each of you to the interests of the others.” Disasters, whether natural or man-made, are inevitable. Some can be prevented with proper planning and preparedness. Others, though foreseeable yet unavoidable, can result to lesser casualties and damage with timely and coordinated recovery efforts. Admiral Alexander Pama, the master of disaster, and Ricardo Jalad, his successor at NDRRMC, will need a holistic approach and a team effort to minimize casualties and damage during disasters. Everything will be easier when we share that inherent but often-neglected responsibility of caring for ourselves, for our country, for Mother Earth, and for others.

Japan, also shared the critical role of the community in disaster science. Shaw believes that prevention, preparedness, response and recovery are keys to better partnerships and innovation in DRR. Unfortunately, the government approach is to often use an engineering solution to a social problem. And the social solution to this social problem is to engage every member of the community in DRR. On the part of the Department of National Defense, it will continue to provide leadership, contingency plans, training on disaster preparedness, disaster management operations, and pre-disaster and post-disaster assessment. According to the United Nations International Strategy for Disaster Reduction, economic losses from disasters ($300 billion a year) will likely continue in the future if no intervention is made by the government and the private sector by working together, especially with the gradual impact of climate change. On the part of the Climate Change Commission, Assistant Secretary Rommel Cuenca emphasized the need to transition toward a green

Deneen’s portrait is sometimes a caricature but, like any good one, it captures important things about our situation. Still, one obvious response was offered last week by my colleague David Brooks, who argued that liberalism does not have an inevitable arc: It also has the capacity to regenerate itself, to support the goods Deneen cherishes and solve the problems he identifies. But my own response to Why Liberalism Failed was disappointment that its author did not go further. At the end, having delivered his indictment, Deneen declines to envision any alternate political order; instead, he rejects ideology and urges a rededication to localism and community, from which some alternative political and economic order might gradually develop. Yet, if the liberal order is increasingly oppressive and destined to get worse, why would one expect such communities and experiments to flourish, rather than simply being plowed under by the same forces he decries? Surely if there is political

For questions and comments, please e-mail me at sbmison@gmail.com.

life after liberalism, someone will need to step forward and do what the liberal philosophers did several centuries ago—invent the new order, describe the new ideals, urge the specific transformations that future leaders might achieve. And if this isn’t happening, if even liberalism’s sharpest internal critics shy away from imagining a truly different regime (not just a more Scandinavian one for the far left or a more Polish one for the far right) lest they seem ridiculous or nostalgic or utopian or totalitarian—well, then maybe the crisis of liberalism isn’t real, maybe people are just play-acting, as Steve Bannon turned out to be play-acting the 1930s, within a system too settled to really be moved except by inches. Which would be good news for the West in a way...but maybe only in a way, because sometimes you can’t renew an order, as ours clearly needs renewal, until the political imagination becomes capable of imagining and desiring something different.

2nd Front Page BusinessMirror

A16 Monday, January 15, 2018

Senate eyes Charter change that amends economic provisions L

By Butch Fernandez

@butchfBM

ong-envisioned but always sidelined amendments to the economic provisions of the 1987 Constitution—seen as too restrictive as to hinder the country’s global competitiveness and ability to invite investments—may finally push through as a result of the imperative to change the Charter to transition to federalism. However, Senate leaders served notice this early they will not railroad early passage of bills that will pave the way for proposed Charter changes to be enacted into law, ever mindful of the Senate’s fewer number of legislators compared to the House of Representatives.

“No fast-tracking,” Senate President Aquilino L. Pimentel III, told the BusinessMirror last Sunday. “But we will work harder and faster, the best we can.” That same cautionary stance was made clear by Majority Leader Vicente C. Sotto III, who balked

40:60

The economic provisions in the 1987 Constitution on investments that the Senate wants amended at suggestions from some quarters to fast-track efforts to tinker with the Charter through a constituent assembly. Asked if the Senate, dominated by Duterte administration allies, will rush approva l of pend ing Char ter change legislation, Sotto allayed fears the enabling measure will be railroaded. “Not really, we will follow the regular approach,” Sotto said in a text message to the BusinessMirror, even as he left the door open that the Cha-cha proposal “can be

listed as a priority.” Brushing off criticism raised earlier by Speaker Pantaleon D. Alvarez, who chided the senators as the “slow Senate,” Sotto said when it comes to workload sharing to tackle an expectedly heavy legislative agenda on Charter changes, it was more prudent for the Senate to take its time because, “The House of Representatives has 300 members, we only have 23 [senators]. There are so many of them to share the workload. But we have only a few people, so we’re loaded.” High on the list of priority bills lined up for early plenary consideration when the Senate resumes regular sessions this week are proposals for amending the Constitution, which allies of President Duterte have been pushing as a means for laying the groundwork for federalism. Continued on A2

BNPP can be rehabbed, experts say CUSI: “Nuclear experts submitted their recommendation. The Bataan Nuclear Power Plant can still be rehabilitated.”

By Lenie Lectura @llectura

uclear experts based in Russia and Korea told the Department of Energy (DOE) that the 620-megawatt (MW) Bataan Nuclear Power Plant (BNPP), the first nuclearpower plant built in Southeast Asia more than three decades ago but never went into operation, could still be rehabilitated. “They submitted their recommendation. It can still be rehabilitated… . I’m looking at the community and the people. I have to go and respect that. The bigger battle is the acceptance of the community,” Energy Secretary Alfonso G. Cusi said. In August last year, the Nuclear Energy Program Implementing Organization (Nepio), a unit created by the DOE, together with representatives from the Philippine Nuclear Research Institute (PNRI) and National Power Corp. (Napocor) met with representatives of The Russian Federation State Atomic Energy Corp. (Rosatom) to conduct an assessment of the BNPP. Their findings were turned over to the authorities last month. Amid the recommendation from nuclear experts, the agency has yet to decide pending the outcome of a nuclear policy being crafted. Cusi stressed though that the proposed policy is not specific to BNPP. “On rehab, that is within my control. Assuming, without saying, that the community will not permit it, I have to look at an alternative because I have to put a closure to the BNPP,” Cusi said. Continued on A2

ANGELS WALK FOR AUTISM About 20,000 people join the Angels Walk for Autism, spearheaded by SM Prime Holdings President Hans T. Sy. (center), other SM executive and officials of the Autism Society Philippines. The event was held last Sunday at the SM Mall of Asia Arena in Pasay City. Autism is a lifelong developmental disability that makes it exceptionally challenging for afflicted individuals to communicate, socialize and adapt to the world around them. ROY DOMINGO

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PHL TO PRESS WTO FOR SETUP OF SAFEGUARDS FOR FARM PRODUCTS By Jasper Emmanuel Y. Arcalas @jearcalas

anila will continue to push for the establishment of a scheme that would protect the farm sectors of developing countries and least-developed countries from harmful import surges during agriculture negotiations at the World Trade Organization (WTO) this year. Agriculture Secretary Emmanuel F. Piñol told the BusinessMirror that the Philippine government would press for the setup of the special safeguard mechanism (SSM), even after talks at the WTO’s 11th Ministerial Conference (MC11) in Buenos Aires, Argentina, collapsed last month. “Yes, of course,” Piñol said when asked if the government will push for the creation of SSM at the WTO this year. “It [the SSM] is our gift to Filipino farmers. And we urged the WTO Secretariat [at MC11] that SSM should be part of the issues to be tackled this year,” he added. Agriculture negotiations at the WTO are set to resume on February 20, with a meeting of an Informal Committee on Agriculture. This would be followed by the two-day meeting of the Committee on Agriculture on February 21 and 22. Piñol was part of the Philippine delegation to MC11, which pushed for the creation of an SSM or an improved special safeguard (SSG) to protect small-scale farmers from the detrimental effects of cheap foreign agricultural imports. However, as MC11 reached its conclusion last December 14, the 164 WTO member-countries failed to come up with a firm ministerial decision on agriculture as they expressed divergent views on issues, such as SSM and public stockholding (PSH). “I think there was clearly no outcome here on agriculture. Those are very, very difficult issues; we knew that from the very beginning,” WTO Director General Roberto Azevêdo said in a news briefing on December 14 (Philippine time). Azevêdo recalled that previous ministerial conferences—in Bali, Indonesia, and Nairobi, Kenya—made breakthrough outcomes on agriculture, including a temporary solution on PSH and elimination of export subsidies. In a statement dated Decem-

ber 12, the Philippines said that it is “deeply regretful and disappointed” that there was no draft decision on SSM, despite the priority accorded to it under the Nairobi Declaration of 2015. At the same time, the Philippines stood firm on its decision to reject any substantive decision on agriculture sans the SSM. “The Philippines reiterates that it could not join any consensus for adopting any draft substantive decision in the absence of a solution on SSM or through an improved SSG. There simply is no sufficient political basis for us to do so,” the statement read. The Philippines emphasized that the approval of SSM is vital for its farm sector as the present SSG proves to be inefficient and ineffective to protect its smallscale framers from import surges and price depressions. Manila said the Philippines’s current trigger price for corn is 5 cents per kilogram (kg), but the import price for the last three years average 31 cents. Another example, it noted, is that the trigger price for pork imports is pegged at $36 per kg compared to $1.65 per kg average price in the past three years. Jonathan Hepburn, agriculture senior program manager at Geneva-based International Centre for Trade and Sustainable Development, told the BusinessMirror that the breakdown of agriculture talks at MC11 would mean that trade negotiators would have to double their efforts “to make global markets for food and agriculture fairer and more sustainable.” “The inability of WTO members to agree on a consensus on agriculture in Buenos Aires is definitely a setback for countries that had hoped to see outcomes on specific issues, including the SSM, but also on other issues such as trade-distorting farm subsidies and agricultural export restrictions,” Hepburn said in an e-mail interview. “Progress in improving agricultural trade rules is critical if countries are serious about achieving Sustainable Development Goal 2, which commits governments to ending hunger and malnutrition by 2030. The poor outcome from Buenos Aires means trade negotiators must now redouble efforts to make global markets for food and agriculture fairer and more sustainable,” he added.

Duterte to issue ‘mother of all executive orders’ to govern Boracay devt Continued from A1

Authority (Tieza), the infrastructure arm of the DOT. A ranking DOT source who was present during the closed-door meetings on the island between the two Cabinet secretaries with Aklan Gov. Florencio Miraflores, Malay Mayor Ciceron Cawaling and representatives of other relevant government agencies, told the BusinessMirror “it’s technically a new EO. The Department of Environment and Natural Resources, DOT and Tieza have already prepared their own versions of the EO. The Secretaries will assign people who will reconcile all drafts to come up with one EO, which will be signed by President Duterte, Asap.” Teo added that the new EO would likely expand the membership of the interagency task force that would oversee the development of Boracay. In 2004 Arroyo also issued EO 377, which created an Eminent

Persons Group from the private sector to oversee the “sustainable development” of Boracay. The Philippine Chamber of Commerce and Industry-Boracay has been urging the creation of the tourism authority that would take over Boracay and oversee its development. (See,“Boracaynons skeptical of government promise to solve island’s nagging issues,” in the BusinessMirror, January 19, 2018.) Meanwhile, during last week’s news conference on the island, DOT Regional Director for Western Visayas Helen Catalbas said that despite the recent flooding incident on the island due to Typhoon Urduja, “there were minimal or no cancellations [of bookings from tourists].” In 2017 over 2 million tourists went to Boracay, up 17.6 percent from the arrivals in 2016. Data from DOT-Region 6 showed about 49 percent of the 2017 arrivals in Boracay were foreigners, while the

rest were Filipinos. Also, the data showed the top source markets for tourists in Boracay last year were China at 375,284; followed by South Korea at 356,644; Taiwan, 40,802; the United States, 22,648; Malaysia, 20,585; the United Kingdom, 17,416; Saudi Arabia, 15,944; Australia, 15,365; and Russia, 14,074. Overseas Filipinos, or those residing or working abroad but still carrying Philippine passports were 42,060. Boracay continues to be the top destination for local and foreign tourists, according to Marlene Dado Jante, president of the Philippine Travel Agencies Association (PTAA). In PTAA’s news conference to announce the 25th Travel and Tour Expo from February 9 to 11 at the SMX Convention Center, she said “Boracay is still the No. 1 destination,” but the group is heavily promoting other destinations, as well, especially in Mindanao. The continuing surge in foreign

arrivals in Boracay may be attributed to the increasing number of direct flights between China and specific Philippine destinations. At the PTA A news conference, Philippine Airlines Assistant Vice President for Passenger Sales Antonio Herrera said: “China is already very, very aggressive in chartering flights, especially to Caticlan, to the Visayas region, and we’re open to this.” He added that charter flights from several points in mainland China to Kalibo, Aklan, “will continue then points also to Bohol, Puerto Princesa…because the Chinese want to explore. They want to go to the Philippine beach destinations, so any place they want to charter, we’re open.” Close to 400 exhibitors will be participating during the TTE in February, including the biggest airlines, hotels, resorts, theme parks and cruise lines worldwide. It will feature all the tourism stakehold-

ers in the country, embassies and national tourism organizations, she added. “Over the years, the Travel Tour Expo has prided itself as the onestop shop for all the travel needs of our countrymen. We intend to keep and even exceed that commitment in February,” Jante added. She said “we have asked the airlines to give us the lowest rate at the expo, also the resorts. This is really the time for the public to get the lowest possible rates [for their holidays].” She added a trip to Boracay inclusive of roundtrip airfare, for instance, and a two-night stay can be had for P2,800 per person. To Hong Kong, Jante said they have a P7,000 package, while in Taipei, as low as P8,000 per person, also inclusive of roundtrip airfare and a two-night hotel stay. “PAL is offering us a very good deal. Also, our suppliers abroad are offering us very reasonable rates.”