Issuu

Integrity pacts and open contracting: The EU perspective

By Henry J. Schumacher

SKYPIXEL | DREAMSTIME.COM

n 2016 one in three Europeans felt that their governments and political leaders were mostly or entirely corrupt. The European Commission consequently teamed up with Transparency International to pilot the use of integrity pacts (IP). In essence, an IP is an agreement with the public authorities that allows civil society to act as independent monitors of the procurement process. Continued on A12

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Tuesday, January 23, 2018 Vol. 13 No. 104

‘Economic Cha-cha not enough to end PHL woes’

By Jovee Marie N. dela Cruz

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awmakers now at the forefront of efforts to amend the 1987 Constitution at the House of Representatives on Monday rejected calls from business groups to limit the Charter change (Cha-cha) initiative to the economic provisions. “The suggestion that this attempt at Charter change be limited to the economic provisions is unwise, partly because, as the business sector knows, governance

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issues are also at the core of the medium-term and long-term development goals. To neglect governance is to just partly solve decadesold problems,” said Rep. Roger G.

ALVAREZ: “We will try our best to come up with the best revision of the Constitution that will benefit the people, not just the interest of some sectors.”

Mercado of the Lone Disttrict of Southern Leyte, chairman of the House Committee on Constitutional Amendments. He added: “It is also unwise, because it would be wasted opportunity to overlook governance issues at this time when the

Manny B. Villar

THE ENTREPRENEUR

an’s unending quest for things and ways to improve his life has led, and continues to lead, to numerous inventions and processes that make living a lot more enjoyable, efficient and rewarding. The invention of motor vehicles, trains, modern ships and airplanes, for instance, has virtually shrunk the distances between cities and countries. Still, research continues on how to make travel faster. The impact of modern transportation on people, countries and the global economy is so huge that it is difficult to imagine what life would be without these inventions. Continued on A10

See “Cha-cha,” A2

TRAIN-induced Diwalwal price hikes to BMReports loses luster as investors ‘Capitalism with a heart,’ v. 3.0 gaining more advocates in PHL peter out–Pernia stay away By Cai U. Ordinario @cuo_bm

By Rizal Raoul S. Reyes

By Manuel T. Cayon @awimailbox Mindanao Bureau Chief

AVAO CITY—No new big investor, local or foreign‚ has filed application nor signified interest to explore the Diwalwal mining area in Compostela Valley, formerly the site of a gold rush.

729 has The size of the Diwalwal gold-rush site

This lull, Compostela Valley Gov. Jayvee Tyron L. Uy said, should be used by concerned authorities to implement the order of President Duterte to rehabilitate the 729-hectare mining area atop the Mount Diwata Range and provide fresh livelihood opportunities to displaced miners. “We have yet to implement social programs and livelihood opportunities for the area. We already had rigid discussions with the DENR [Department of the Environment and Natural Resources], the municipal government led by Mayor Ramil See “Diwalwal,” A2

from philanthropy to social business should be seen in the context of the government’s 2040 vision called “AmBisyon Natin 2040” (Our Ambition 2040). The AmBisyon Natin 2040 is the Duterte administration’s economic vision, “which embodies the

ocioeconomic Planning Secretary Ernesto M. Pernia on Monday assured consumers that the uptick in prices due to the impact of the TRAIN (Tax Reform for Acceleration and Inclusion) Act is only temporary. In the meantime, the Department of Labor and Employment (DOLE) said it is ready to extend assistance to cash-strapped workers that will be affected by the newly implemented law. In an interview with the BusinessM irror, Labor Undersecretary Joel B. Maglunsod said TRAIN-affected workers—estimated at around 15.6 million—could avail themselves of livelihood aid under their Tulong Panghanapbuhay sa ating Disadvantaged/ Displaced Workers Program (Tupad) in their regional offices. “We are ready to provide livelihood to their families so they could earn more income.” Pernia said higher prices are only temporary, and the overall impact of TRAIN on consumers remains net positive to them. “Well, with the higher income for those earning below P250,000, there will be a lot of welfare enhancement on their part,” Pernia said. “The net effect is still positive on them, and the heightened prices will be temporary, [because] it peters out over time.” In its latest market call report, First Metro Investment Corp.-University of

Continued on A2

Continued on A12

@rizreyes

Part Two

CCORDING to AntiCSR web site, advocates of corporate social responsibility (CSR) pushed CSR version 3.0 as “no longer a tool to reduce risk, but a strategy that ‘creates and protects value for the company and society.’” Advocates wanted companies to make CSR integrated in all functions of a company, AntiCSR wrote. This move came after companies were criticized for going into CSR only to create an image of benevolence, with social activities incremental at best. Or worse, by just writing checks to charities, businesses remained at the ovulation stage of CSR, wherein activities were geared more to promote companies as charitable institutions. “Corporations used philanthropy as a tool to improve their firm’s image,” AntiCSR said. Going beyond philanthropy is how the government sees CSR. That was what Socioeconomic Planning Secretary Ernesto M. Pernia expressed in a presentation during the “CSR in the Philippines Conference on Responsible Business” early-January.

PESO exchange rates n US 50.6890

A fisherman carries his tuna catch for the day at the fish port of General Santos City in the province of South Cotabato. According to Carlos Abad O. Santos, National Economic and Development Authority assistant secretary for Planning and Policy, corporate social responsibility is more than giving money to poor Filipinos in the fisheries and farming sectors. Nonetheless, the government is also continuing programs that give cash to indigent Filipinos. NONIE REYES

“Social objectives need to be integrated into core business toward inclusive development,” Carlos Abad O. Santos, National Economic and Development Authority (Neda) assistant secretary for Planning and Policy, said as he delivered Pernia’s presentation. Moreover, Santos reiterated

that it should be realigned with the Sustainable Development Goals (SDGs), “a universal call to action to end poverty, protect the planet and ensure that all people enjoy peace and prosperity.”

AmBisyon Natin 2040

ACCORDING to Santos, moving

n japan 0.4583 n UK 70.4222 n HK 6.4849 n CHINA 7.9165 n singapore 38.4066 n australia 40.5309 n EU 62.2106 n SAUDI arabia 13.5163

Source: BSP (22 January 2018 )

BMReports BusinessMirror

A2 Tuesday, January 23, 2018

www.businessmirror.com.ph

‘Capitalism with a heart,’ v. 3.0 gaining more advocates in PHL Continued from A1

collective long-term vision and aspirations of the Philippines in the next 25 years.” AmBisyon Natin 2040 is detailed in the Philippine Development Plan (PDP). The ambitious economic design that is the PDP aims to catapult the country into a middle class economy after two decades, according to Santos. “AmBisyon Natin 2040 is a picture of the future, a set of life goals and goals for the country. It is different from a plan, which defines the strategies to achieve the goals. It is like a destination that answers the question ‘Where do we want to be?,”’ the Neda said in its web site. “A plan describes the way to get to the destination; AmBisyon Natin 2040 is the vision that guides the future and is the anchor of the country’s plans.” According to the PDP, the government expects that by the year 2040, “the Philippines is a prosperous middle-class society where no one is poor.” “People live long and healthy lives and are smart and innovative; the country is a high trust society where families thrive in vibrant, culturally diverse and resilient communities.”

SDGs

ACCORDING to Santos, the 2040 Vision, as articulated in the current and succeeding PDPs, also include the national implementation of the global 17 SDGs. “I am happy to note that the various business associations in the country have been instrumental in raising awareness on the SDGs and in providing support mechanisms by aligning their core business processes, activities and initiatives with the SDGs,” Santos said. “While some

Cha-cha. . .

Continued from A1

combined political capital of President Duterte and of Congress is enough to deliver on the commitment to give Filipinos a government that is closer to them and away from Imperial Manila.” Speaker Pantaleon Alvarez said their resolve to revise the Charter according to the needs of the Filipino people will not be swayed by interest groups. “We will try our best to come up with the best revision of the Constitution that will benefit the people, not just the interest of some sectors,” Alvarez stressed.

Philippine businesses are already practicing this, many have yet to advance their understanding of the private sector’s contribution to development beyond traditional corporate philanthropy. I am confident that everyone in this room recognizes that CSR is not just about giving money.” Santos said the SDGs that the government is focusing its energy on are the following: ■ SDG 3: Ensure healthy lives and promote well-being for all at all ages; ■ SDG 4: Ensure inclusive and equitable quality education and promote lifelong learning opportunities for all; ■ SDG 7: Ensure access to affordable, reliable, sustainable and modern energy for all; ■ SDG 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all; ■ SDG 11: Make cities and human settlements inclusive, safe, resilient and sustainable; and ■ SDG 12: Ensure sustainable consumption and production patterns.

Fund support

UNDER AmBisyon Natin 2040, the NEDA said the government will have to allot huge investments for sustainable cities and communities (P13.7 billion), quality education (P11.3 billion), clean energy (P7.5 billion) and health (P7 billion). Total investments will reach P39.5 billion. AmBisyon Natin 2040 will also spend gargantuan sums on sustainable consumption and production (P88.6 billion) and decent work and economic growth (P141 billion). Although public sector is going to be in the forefront, the private sector will also have an important role to play.

“They are only after their own interest, of businessmen. What about the people?” The House Committee on Constitutional Amendments has created Sub Committee 4 to review Articles XI, XII, XIII, XIV and XV of the 1987 Constitution. Its work covers the economic provisions and has been gathering inputs through public consultations done in 2016 and 2017, including proposals from the business community. “We wish to assure the business community that seeming disagreements between the House and Senate are simply part of the dynamics of the same democracy that produces the free market environment wherein businesses thrive,”

“Public sector is the linchpin, but privatesector resources will also be required,” the United Nations Development Programme said. The Neda said the financial needs for implementing 2030 Agenda will reach $10 trillion per year. Meanwhile, savings from public and private resources will be $22 trillion per year.

Nation-building

ACCORDING to Santos, the government views CSR in the context of “nation building.” “In the agenda of nation-building, CSR’s shared accountability with the private sector elevates their role from third-party observers to partners in development,” Santos said. “Through CSR, the sector implements programs that seek to bridge gaps and aid the most vulnerable.” He cited the most important element of this is governance. Under Chapter Five of the PDP framework, good governance is given a premium. It calls for a people-centered, clean, efficient and effective governance, where the level of corruption is reduced, administrative governance is solid, seamless delivery of government services, full engagement of empowered citizens and a strong civil service. For these to become reality, we need the participation and contribution of all stakeholders geared towards the PDP 2017-2022, Santos said.

Empowering the MSMEs

TO promote inclusive growth in the countr yside, Duterte said the government plans to allot as much as P50 billion for the funding of micro, small and medium enterprises (MSMEs).

Mercado said. Earlier, the Makati Business Club, Management Association of the Philippines and the Financial Executives Institute of the Philippines urged Congress to prioritize the amendment of the constitutional restriction on foreign ownership. The business groups said they back Congress’s Cha-cha initiative, particularly the proposal to lift economic restrictions in the Constitution, as this will pave the way for a more conducive business environment. Last week Rep. Vicente S.E. Veloso of the Third District of Leyte, chairman of one of the subcommittees proposing amendments

Aside from about P25 billion for microfinancing, Trade Secretary Ramon M. Lopez explained the funding will also cover MSME training, entrepreneurship education, mentoring, shared-services facilities, equipment, product development, suppliers facilitation, design assistance, market development, local and foreign market promotion, retail-store concepts, trade exhibits and building of more Negosyo (business) Centers. As the main agency tasked to promote business growth and creation, the Department of Trade and Industry (DTI) implemented several new programs, as well as continuing to implement programs carried over from the previous administration. The Pondo para sa Pagbabago at Asenso (P3, fund for transformation and progress), for instance, is a P1-billion financing program initiated by Lopez intended to give MSMEs better access to finance, and to reduce their cost of borrowing. The fund gives priority to the country’s 30 poorest provinces, and intends to replace the “5-6” (20-percent interest) money-lending system. In an article published in the BusinessMirror, the DTI said it has allotted P5.1 billion in its budget proposal to the House of Representatives for general programs. MSME Development corners the secondbiggest share of 27 percent—or some P 1.3 billion—of the total programs budget. Philippine MSMEs account for 99.5 percent of the total number of established businesses and employ 62.8 percent of the country’s work force, contributing substantially to the country’s manufacturing output and total employment, making it critical engines of economic growth and development.

to 1987 Constitution, said the proposed Philippine federal government will provide for an “open economy.” Veloso’s subcommittee has proposed to delete the provision in the 1987 Constitution providing the 60-40 limit on foreign-equity sharing. Under the proposal, the areas that will be freed from the said restriction include: exploitation, development and utilization of natural resources, ownership of alienable lands, franchise on public utilities, practice of profession, ownership of educational institutions, mass media and advertising. It added that equity sharing, as well as the terms and conditions involving joint ventures and other

To be concluded

undertakings involving the aforementioned areas, shall be determined through legislation. Moreover, the proposal said the goals of the national economy under the proposed new Charter seeks to increase the amount of goods and services produced by the nation for the benefit of the people. It also seeks to expand the “productivity as the key to raising the quality of life for all, especially the underprivileged and a more equitable distribution of opportunities, income and wealth.” The proposal added that the state shall enhance economic efficiency and promote free competition in trade, industry and commercial activities.

Diwalwal. . . Continued from A1

[Gentugaya] and other agencies,” Uy said. He added the Palace-created Task Force Diwalwal should activate itself and start implementing a rehabilitation activity. The appeal for a rehabilitation of the mountain-top gold mining area was not related to reports of the entry of an Australian mining firm. He clarified that there was no report coming from the Provincial Mining Regulatory Board about it, nor was there any endorsement or recommendation for its operation. “The provincial government released no endorsement and recommendation to any mining venture in Diwalwal.” “As of this moment, my priority is really to rehabilitate Diwalwal. We are yet to implement the housing-relocation plan for the residents,” he said. He disclosed, though, that rehabilitating Diwalwal was contained in “a marching order from President Duterte.” He said the visit last year of Environment Secretary Roy A. Cimatu in Monkayo “is a sign that the government is serious in its Diwalwal-rehabilitation plan.” “I’m very passionate about this plan. I think we owe the people this rehabilitation. I want to ensure the welfare of the environment, the well-being of the people’s health, and the general stability of the communities in Diwalwal,” he said. “Hopefully, we can roll out this plan soon.” Uy allayed fears of the less than 5,000 residents and small-scale miners that the call to rehabilitate the area was meant to displace them. On the contrary, he said, he was assuring them that “the changes in Diwalwal will benefit them.” “I assure them that whatever plan we have for Diwalwal would undergo intensive and inclusive consultations, observance to due process and commitment to social justice. I ask other agencies to follow the same,” Uy said.

Visitors. . .

Continued from A12

of requirements on permits and clearances.” The number of permit/ clearances issued was also 67 percent more than the agency’s target of 1,000 for 2017. Occupancy rate on the commercial properties fell slightly to 68 percent, compared to the 72 percent recorded in 2016. The 2017 rate also did not reach the 72-percent goal for that year. “One [lessor] did not renew,” Asido said. He added that the average rate of return on the estimated commercial value of the properties was pegged at 2.3 percent, exceeding the 2017 target of 1 percent. This was slightly lower than the rate of return recorded in 2016, which was placed at 2.4 percent. Yet, 99.72 percent of users of event facilities in the walled city rated the facilities as “satisfactory or better,” higher than the 90-percent target for 2017, and the 99-percent actual rating in 2016. The IA has also sped up its issuance of permits to use facilities, with 99.92 percent of applications “acted upon in 24 hours.” This was faster than the 2017 target of 90 percent, and the actual accomplishment of 98 percent in 2016. In terms of its regulatory services, 977 permit and clearance holders were monitored and/or inspected with reports issued, up from the 800 targeted last year. This was almost 11 percent lower than the 1,096 monitored and or inspected with reports issued. The IA said only 1.84 percent of submitted reports resulted in a notice of violations or penalties, compared to 2017 target of “not more than 25 percent” of submitted reports.” This was higher, though, than the 0.75 percent posted in 2016. The agency also did not record permit clearance holder with two or more violations, same as in 2016.

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Editor: Vittorio V. Vitug • Tuesday, January 23, 2018 A3

Senate probers: ₧3.5-B Dengvaxia deal rushed

By Butch Fernandez

@butchfBM

enate probers are poised to press charges against Sanofi Pasteur, the French pharmaceutical company that supplied the “risky” P3.5billion Dengvaxia anti-dengue vaccine administered by the Department of Health (DOH) to over 280,000 schoolchildren “without passing through World Health Organization prequalifications.” “One of the findings [by Senate probers] is this project was spend-driven,” said Sen. Richard J.

Gordon, chairman of the Blue Ribbon Committee spearheading the Senate inquiry which opened on

Monday. “I am a lawyer. A big case can be filed against Sanofi,” Gordon said in the midst of grilling DOH officials. “These deal was [rushed],” he added. Citing initial findings, Gordon noted that the multibillion-peso dengue-vaccine purchase was “done in a hasty manner.” The senator also voiced concerns that “if left unchecked, there will be more dead victims.” “These deal was rushed...too fast [in its] implementation,” Gordon said. Former Health Secretary Enrique T. Ona, testifying at the hearing, told senators the Dengvaxia immunization program should not have been readily implemented targeting 1 million schoolchildren, saying there remained “big question marks” when the program was carried out. For instance, Ona said there were “three other vaccines still being test-

ed” at the time it was implemented. He recalled a 2011 study, but said “no conclusion on the dengue vaccine was derived at that time.” The Dengvaxia inquiry was triggered by three related resolutions separately filed by Gordon and senators Joseph Victor G. Ejercito and Grace Poe. Ejercito’s Resolution 557 called for the inquiry into the dengue-immunization program of the DOH, amid clinical findings on Dengvaxia vaccine’s “adverse effects to its recipients.” Poe’s Resolution 563, on the other hand, asked the Senate to “investigate the reported danger of the school-based dengue-vaccination program of the DOH with the objective of crafting measures that will ensure safety and efficacy of government-sponsored immunization programs...and hold accountable pertinent government officials and pharmaceutical manufacturers

in this regard.” Gordon asked Secretary Francisco T. Duque III to ensure that Sanofi will pay for the treatment of vaccinated schoolchildren that suffered the illeffects of the Dengvaxia. “They should set aside resources for the treatment of affected children,” Gordon said, adding the DOH and Sanofi should be in continued talks on “how to help these people.” For its part, Sanofi official Thomas Triomphe assured lawmakers that the company is “holding itself to highest compliance and will shoulder

One of the findings [by Senate probers] is this project was spend-driven. I am a lawyer. A big case can be filed against Sanofi. These deal was [rushed].”—Gordon

House starts Charter amendment By Jovee Marie N. dela Cruz @joveemarie

mid the looming deadlock between the House of Representatives and the Senate on the manner of voting to amend the 1987 Constitution, Speaker Pantaleon D. Alvarez on Monday said the lower chamber has started amending the 1987 Charter. When asked if the House of Representatives is already in the process of amending the 30-yearold Constitution, Alvarez, at a news conference, said “yes.” Alvarez said the lower chamber could do Charter change (Cha-cha) alone even without the Senate. “We are just doing our job as mandated by the Constitution to propose amendments to the Constitution,” he said. “We will just continue our public hearings...and try our best to come up with our best revision for the benefit of the Filipino people,” the Speaker added. Alvarez reiterated his position that the 1987 Constitution was clear on voting jointly to propose amendments or revisions to the Charter just as long as the required three-fourths vote of Congress is met based on the combined number of the Senate and the House. The proposed Charter amendments may be considered and adopted even without the participation of the upper chamber. “Any amendment to or revision to this Constitution may be proposed by the Congress upon a vote of three-fourths of all its members, or 237 lawmakers,” he said. Senators have earlier argued that voting should be done separately because the greater number of the House would practically drown out the Senate position. Section 1, Article VII of the Constitution provides that “any amendment to, or revision of, this Constitution may be proposed by: [1] Congress, upon a vote of three-fourths of all its members.” Disagreement over this procedure may be brought before the Supreme Court (SC) for resolution, Alvarez admitted. “Anyone could question it before the Supreme Court. Now let the Supreme Court decide,” he said. L a st Su nd ay R ep. Vicente SE.Veloso of the Third District of Leyte, vice chairman of the House

Committee on Constitutional Amendments, said they don’t have any choice but to do it alone if the senators refuse to attend a joint session with the members of the lower chamber. “Well, if you see the Constitution, we have to convene as constituent assembly. Two houses, the Senate and the House of Representatives. But if they will boycott us, we don’t have any choice but to do it alone,” he said. “Also, it was not a requirement in the Constitution that senators should always be present,” he added. The lawmaker also said a unicameral legislature is preferable to speed up the process of enacting needed laws and avoid duplication of functions and save public resources. The Congress of the Philippines is a bicameral body, which is composed of the House of Representatives and the Senate. Under the current legislative process, the lower chamber should transmit its approved bills to the Senate for its own deliberations and approval. Then, both chambers should also agree and pass one version of a bill through bicameral conference committee.

2019 plebiscite

Alvarez, meanwhile, said if some unforeseen circumstances cause delays in the process, the House is willing to do the plebiscite in 2019. The Speaker said that, while his original target date is to submit to the Filipino people the proposed Charter changes simultaneous with the May 2018 barangay elections, he is open to the possibility of moving the deadline to 2019 midterm election if necessary. “If, for example, we do not meet the requirements of the law [we will adjust] then we definitely have to comply,” Alvarez said. He added he is pushing for Chacha because it was one of the major campaign promises of President Duterte in the 2016 campaign. Alvarez said that the shift to a federal form of government was one of the four major campaign promises of Duterte when the latter ran in the elections. Duterte already has “substantial compliance” with his other three main promises, the fight against illegal drugs, war against criminality, and war against corruption, according to Alvarez.

Tesda approves tech-voc training for ML victims By Claudeth Mocon-Ciriaco Correspondent

Curse of construction

Workers mark the spot where concrete and iron posts for the elevated Metro Railway Transit 7 will be erected along the stretch of North Avenue in Quezon City. The construction of the project, which is expected to constrict vehicular traffic in the area, will last until late next year. NONOY LACZA

Despite controversy, frigate project must push through–ex-Navy FOIC

ormer Navy Flag Officer in Command Vice Adm. Ronald Joseph Mercado defended on Monday the position of the Navy’s technical working group (TWG) in pushing for Thales Tacticos of Netherlands as contractor for the combat management system (CMS) of the military’s frigate acquisition project, saying it is for the best interest of the Navy. “I don’t think my people will look kindly at me. I was the flag officer in command, [am I not]? I gave them instructions to follow the contract. They were raising [something], and yet, I will not support them, it will not look good,” he said. While Mercado and the members of the TWG have pushed for the Thales Tacticos, the Hyundai Heavy Industries (HHI), which bagged the P18-billion contract for the delivery of the two brand-new frigates, selected Naval Shield of Hanwha Thales of South Korea as the CMS contractor. According to Party-list Rep. Gary C. Alejano of Magdalo and even by the Navy’s TWG, the CMS

capability of the South Korean contractor is inferior to the program of Thales Tacticos. Alejano added the “Hanwha Thales Joint Venture that developed the Naval Shield CMS was already dissolved as early as August of 2016, or way before the signing of the contract. But the contractor continues to refer to it as Hanwha Thales, which Thales protested.” It was Alejano who put forward the controversy surrounding the CMS project for the frigate acquisition program following the relief of Mercado as Navy chief. Defense Secretary Delfin N. Lorenzana relieved Mercado of his post after claiming he had lost confidence over the former navy chief, whom he had charged of insubordination for holding his line for Thales Tacticos, which had reportedly resulted in the delay of the project. The Senate minority bloc has pushed for the investigation of the frigate acquisition project, which the defense department,

through its spokesman, Arsenio Andolong, has welcomed. Mercado said that if the Navy is going to acquire frigates, then it should go for the best since it has the money, other than following the contract that was borne out of years of studies and evaluation. “Other navies, obviously go to systems that are proven…you spend so much and then it is a failure, and that’s a combat ship. If you want our country to be defended well, to the people, at least they have that assurance that our ship can fight,” he said. Lorenzana said earlier that the contract with HHI has empowered the contractor to choose the company that will deliver the CMS for the frigates that it will build and deliver to the Navy. Reports earlier claimed that Presidential Assistant to the President Christopher Go pushed for Thales South Korea, but this was denied by the defense department and even Mercado. They maintained that Go never intervened in the project. Rene Acosta

Overstaying Iraqi with Hamas links nabbed in Angeles City

olicemen arrested last Sunday an Iraqi who has ties with foreign extremist groups in the Middle East and a self-confessed bomb and rocket expert. Taha Mohamed Al-Jabouri, 64, was arrested by operatives of the National Police Intelligence Group (PNPIG) at around 3 a.m. at Barangay Malabanias in Angeles City, Pampanga. According to PNP chief Director

General Ronald M. dela Rosa, Al-Jabouri traveled to the country at the heat of the Association of Southeast Asian Nations meetings last year, and his presence was relayed by the Iraqi Embassy in Manila. “I would like to announce that we have taken into custody a 64-year-old Iraqi man who came to our country in August last year during the height of the 31st Asean Summit activities and

the cost of casualties if proven to be caused by vaccination, adding Sanofi would be “willing to reimburse.” At the same time, DOH officials told senators they will conduct continued “school based” surveillance of Dengvaxia vaccine recipients for prompt response, if needed. Before adjourning the hearing, Gordon announced the Blue Ribbon Committee will resume the hearing on February 6, after which it is expected to submit a report endorsing passage of remedial legislation, to prevent a repeat of the incident.

has since evaded our radar after the Iraqi Embassy in Manila alerted the Philippine intelligence community of his presence,” dela Rosa said at a news briefing on Monday. The PNP chief said the Iraqi Embassy described Al-Jabouri as a chemist with knowledge on explosives and is known to have close ties with militant extremist movements in the Middle East, including the Hamas.

The Hamas is a Palestinian Islamic militant group, and its military wing, the Izz ad-Din al-Qassam Brigades, has been considered as a terrorist group. According to dela Rosa, the PNP received last Saturday, an information through its Barangay Information Network about the presence of a suspicious-looking person with Middle Eastern features at

Barangay Malabanias. He said the man fits the description and photographs provided by the Iraqi Embassy. The tip-off prompted the IG to conduct follow-up operations and nab Al-Jabouri in the area, toting a large black luggage. When asked about his identity, the Iraqi readily presented his Iraqi passport and identified himself. Rene Acosta

ome 6,000 victims of humanrights violations under the Marcos regime have been listed as eligible claimants of the Non-Monetary Reparation being implemented in partnership with the Technical Education and Skills Development Authority (Tesda). Tesda Director General Secretary Guilingg A. Mamondiong said the beneficiaries are part-off if the initial list from the Human Rights Victims Claimants Board (HRVCB). Mamondiong said that Tesda, as one of the implementing partners of HRVCB, will not be giving out financial assistance to the humanrights victims. Instead, Tesda will provide training interventions that would help the members and their families improve their chances of getting jobs, either as wage earners or self-employment. “The eligible beneficiary may avail of the free skills training and other Tesda services, such as training needs assessment, career counseling, competency assessment and certification, entrepreneurship training and job referrals. They may avail themselves of multiple scholarship programs, but not simultaneously,” Mamondiong said. He added the beneficiaries may go directly to the nearest Tesda office to inquire about available scholarship programs, such the Training for Work Scholarship Program, Private Education Student Financial Assistance, Special Training for Employment Program and Language Skills Training, to avail themselves of the training programs. In the absence of a surviving human-rights victim, the benefit can be availed of by one of the human-rights victim’s qualified dependents. After the human rights victim has completed the training, the Tesda will endorse the eligible graduate certificate to the Public Employment Service Office of the local government units for job referral. The government recognizes the heroism and sacrifices of humanrights victims during the martiallaw regime from September 21, 1972, to February 25, 1986. “It also acknowledges its moral and legal obligation to provide reparation to the victims, as part of their right to access to justice, with the objective of ending human-rights violations committed within its territory by state agents,” Mamondiong said. Aside from Tesda, the HRVCB met various government agencies to discuss and clarify obligations to provide nonmonetary reparations for victims of human-rights violations during martial law (ML).

Economy

A4 Tuesday, January 23, 2018 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

TRAIN rebates may get stalled, lawmaker warns

By Butch Fernandez

@butchfBM

iting lack of manpower, Senate President Pro Tempore Ralph G. Recto warned on Monday the Department of Social Welfare and Development (DSWD) must first address its manpower inadequacy before the agency can take in some 5.5 million households, who shall be enrolled in the rebate scheme of the Duterte administration’s newly enacted Tax Reform for Acceleration and Inclusion (TRAIN). Recto raised the warning after Malacañang confirmed the allocation of P24.5 billion in the 2018 national budget for TRAIN assistance, which, he said, included unconditional cash grants to the poorest 50 percent of households identified by the DSWD. In a news statement, Recto said that some 5.5 million households, who are not listed in the government’s conditionalcash transfer (CCT) program, will get P200 per month from the government to help them weather the impact of new taxes on the cost of living. “They will join 4.5 million presently enrolled CCT families whose monthly stipends will also be increased by P200— bringing to 10 million the number of families who will be aided so they could cope with TRAIN-triggered hikes in the prices of goods,” Recto said. The senator noted that while the 2018 national budget lodges the P24.5 billion in TRAIN rebates with the LandBank of the Philippines (LandBank), “we all know that it is just being parked here.” Recto voiced concern that the LandBank

₧24.5B

The total allocation earmarked by Malacañang in the 2018 national budget for TRAIN assistance, which include unconditional cash grants to the poorest 50 percent of households identified by the DSWD

has “no capacity to pinpoint recipients,” even as the lawmaker noted that it will be the DSWD rank and file that will “have a say on how it will be disbursed.” He noted that the DSWD, which is expected to serve at least 55 million clients this year, “will have so much on its plate that it will be hard-pressed to serve more people.” Recto added that identification of beneficiaries alone is already a major production, “not to mention the delivery of the financial

aid,” to qualified recipients. According to Recto, the DSWD only has 2,842 regular employees to serve a clientele base of 28 million, on whom P137.5 billion will be spent this year. “Since 2010 the budget of the DSWD has ballooned eightfold, but its manpower grew by 10 percent only,” he said. Because TRAIN beneficiaries are projected to be much more than CCT enrollees, he estimated the number of people being assisted by the DSWD will double. “So, let us not say this will have no impact on the DSWD’s organizational capacity,” Recto added. “To be able to meet its multiple mandates, DSWD has been forced to hire a large army of temporary employees numbering 25,122, under an alphabet soup of hiring schemes,” Recto said. “The result is that 9 in 10 DSWD employees are nonpermanent. Many of them, in the service for decades, remain under contractual status with no security of tenure,” he added. Recto lamented that the combination of the rapid expansion of beneficiaries and the freeze in manpower strength resulted in deficiencies. He noted that the Commission on Audit (COA) had even recommended the DSWD suspend the expansion of CCT beneficiaries until leakages in the system are plugged. He cited the case of duplicate entries in the roster of CCT beneficiaries that led to the “unauthorized release of grants amounting to about P335 million,” according to a 2017 COA report. “Another bad side effect of having a big budget and a small staff is that, when funds are not liquidated by DSWD recipients, the responsible DSWD officers are the ones sanctioned,” Recto said. He added that due to the number of signatures required for public funds to be released, the implementation of projects have been delayed, citing for instance the DSWD’s ability to spend allotments, failing to obligate P23 billion from 2015 to middle of 2017.

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D.O.E. okays grid impact study for three power projects

he Department of Energy (DOE) has cleared three power projects for the conduct of a grid impact study (GIS). A clearance for the conduct of a GIS is necessary for a power firm before it can proceed with the construction of its power project. The proposed projects could generate a total of 654-megawatts (MW). Based on a recently released DOE data, the project proponents that were allowed to proceed with the GIS are Solar Philippines Commercial Rooftop Projects Inc., Isabela Power Corp. and Energence Renewable Energy Corp.

Solar Philippines plans to put up a 2x300 MW solar-power facility in IbaPalauig, Zambales. It was issued the green light for the conduct of a GIS on November 2, 2017. Isabela Power, meanwhile, plans to put up a 19-MW hydro-power plant in San Mariano and San Guillermo, Isabela. Energence Renewable also plans to put up a solar plant with a 35-MW capacity in Clark Freeport Zone, Pampanga. The DOE’s go ahead to Isabela Power was issued last November 17, while Energence secured its approval last November 24. Lenie Lectura

Total fireworks ban to displace some 75,000 industry workers By Elijah Felice E. Rosales

@alyasjah

he Department of Trade and Industry (DTI) is now working on transferring more than 75,000 workers in the fireworks industry to another livelihood opportunity, as President Duterte is set to impose a nationwide ban on firecrackers and pyrotechnics. Trade Secretary Ramon M. Lopez confirmed the DTI is now in the process of identifying those who will be displaced out of their work once the President prohibits all forms of fireworks in the country. In the recent Cabinet meeting on January 8, Duterte told the Cabinet of his plan to implement a nationwide ban on firecrackers and pyrotechnic products. There, he instructed Lopez to begin identifying the more than 75,000 individuals employed in the fireworks industry. He directed the trade chief to pull them out of their jobs and provide them an alternative livelihood. “They [workers] are being identified so livelihood programs can be offered,” Lopez told the BusinessMirror. He added alternative jobs will also be made available

in case some of the would-be displaced workers opted not to maintain a business. It is not yet clear, though, as to what assistance the livelihood programs and job opportunities will be given to the affected workers. The looming nationwide fireworks ban is awaiting action in Congress upon the instructions of the President to his allied lawmakers to convene and discuss the proposal. “He wants Congress to enact this law at the soonest possible time so that the public debate on the banning of fireworks and pyrotechnics could begin as early as possible,” Presidential Spokesman Harry L. Roque Jr. said the day after the Cabinet meeting. Industry players, Roque added, will be consulted by lawmakers in the crafting of the law. However, he emphasized they should not expect Duterte to have a change of heart in his intent to impose a nationwide ban. The looming fireworks ban comes just roughly seven months after the President signed Executive Order 28, which regulated the use of firecrackers. Under a total ban, even the use of pyrotechnics, such as sparklers, fountain and Roman candle, will also be prohibited for sale in the market.

Albay lawmaker seeks aid for Mt. Mayon evacuees

ep. Joey S. Salceda of the Second District of Albay has appealed for relief assistance and donations for Mayon Volcano evacuees, now housed in government evacuation centers around the province, to augment limited resources of local communities. After the Philippine Institute of Volcanology and Seismology (Phivolcs) raises Alarm No. 4 in areas surrounding the restive volcano, Salceda said there’s a need for steady supply of relief goods—food items and drinking water—especially since no one can tell when the calamity would end, as in the past Mayon eruptions when evacuees stayed for months in evacuation centers. As of January 18, there were 6,973 families, or 26,971 persons, housed in evacuation centers based on reports from Municipal Disaster Risk reduction and Management offices and the Provincial Social Welfare and Development Office. The evacuees come from identified risk areas around Mount Mayon. About half of the evacuees come from Camalig and Daraga towns. Camalig has the largest displaced population of 1,995 families, or 7,332 persons, followed by Daraga with 1,384 families, or 5,697 persons. Salceda said should the alert level escalates to Alert 4, Camalig would actually need to evacuate some 4,800 more families, since its entire poblacion is within Mayon’s 9-kilometer Permanent Danger Zone. In the worst Mayon eruption in 1814 records at the National Archives show that over 700 perished, 400 of whom were from Camalig, followed by Budiao with 200, Cagsawa with 100 and Guinobatan with 12. The Team Albay Youth Organization (Tayo) Inc., a youth group under Salceda’s Albay second district office, had already started accepting relief donations for the evacuees. Together with the Filipino-Chinese communities, Tayo has recently provided psychosocial and relief assistance, aside from hygiene kits, to 2,949 families to evacuees at the Camalig North Central School, Anoling and Bariw in Camalig; and

at the Guinobatan East, West and Binogsacan in Guinobatan. Donors can contact Tayo Inc. at its address at Door 2, Citispire Building, Imelda Roces Avenue, Gogon, Legazpi City, with cell-phone number 0927-6654715. For cash donations, donors may deposit them to the Team Albay Youth Organizations Inc., Metrobank account with account number: 595-7-59500460-4. For Daraga, donors can contact; Vice Mayor Carlwyn Baldo at 0918-9637372, and Teresa Bausa at 0939-2041088. For Camalig, donations could be course through Mayor Ding Baldo, or call 0917-8500235. The partial list of evacuees as of January 18 also includes 1,252 families, or 4,353 persons, from Guinobatan; 565 families, or 2,182 persons, from Tabaco City; 791 families, or 3,056 persons, from Malilipot; 215 families, or 890 persons, from Santo Domingo; and 811 families, or 3,461 persons, from Ligao City. The number of evacuees could grow, depending on the volcano’s condition. Based on experience, on the average the evacuation period could reach 47 days under Alert Level 2 and 94 days under Alert Level 3. In 2006 the evacuation period lasted 147 days, and in 2009, 185 days. “We urge and appeal to kind-hearted individuals and organizations to please assist our evacuees with their basic necessities so that they can go through this calamity easier, even as Albay’s DNA is resiliency—the Albayano strength of character and knack for survival that have been proven many times over, but not without support from generous kind-hearted individuals and humanitarian groups, as this kind of disaster normally takes longer periods of time,” Salceda said. As in the past, Mayon’s eruption could take weeks or even months, and local governments have to maintain their evacuees in evacuation centers within that period, providing them their basic necessities—primarily food, clean water, health and security requirements— which means they need help. PNA, Manly Ugalde

Let’s talk Halal

Pakistan International Halal Certification Theological Director Mufti Zeeshan Abdul Aziz discusses the Halal and Finance Natural Allies in Global Halal Market during the World Halal Assembly Philippines 2018, with the theme “Developing Halal Premium Brand thru Science, Technology and Innovation,” at the Sofitel Philippine Plaza Hotel in Pasay City last Friday. PNA/Ben Briones

DepEd defends SHS graduates’ competence for employment

he Depar tment of Education (DepEd) on Monday asserted that senior high school (SHS) graduates are fit right after finishing high school. With the four exits envisioned for SHS graduates—namely, higher education, entrepreneurship, employment or middlelevel skills development—the first batch of Grade 12 learners are about to become fullfledged contributors to social development and nation-building. The DepEd is keen to note that the K to 12 Basic Education Program has equipped them with values, knowledge and skills that communities, businesses and industries need, Education Secretary Leonor M.Briones said. Earlier, the Philippine Chamber of Com-

merce and Industry (PCCI) warned that the first batch of K to 12 graduates may not be qualified to work. The PCCI noted that the graduates of K to 12 appear to lack 80 hours or two weeks, which is a minimum requirement for the onthe-job training (OJT) from the first batch of graduates last March. The DepEd said it recognizes the PCCI’s concern with regard to the minimum number of training hours of SHS graduates, and maintains its confidence in the strong partnerships it has forged, and continues to foster with different industry partners, such as PCCI, that enable SHS graduates to strike a balance between theory and practice, specifically through work immersion. Work immersion is a key subject under

the SHS curriculum that may be conducted in different ways and time frame as needed by SHS learners. The subject will provide learners with opportunities to become familiar with the workplace; for employment simulation; and to apply their competencies in areas of specialization/applied subjects in authentic work environments. Specifically, DepEd Order 30 Series 2017, or Guidelines for Work Immersion, provides learners with access to industry partners’ facilities and employment simulation, where they are given opportunities to apply their competencies, gain practical industrial skills and develop good work ethics and values relevant to pursuing further education and/or joining the world of work.

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Banking&Finance BusinessMirror

Editor: Jun B. Vallecera • Tuesday, January 23, 2018 A5

PCIC soon selling reinsurance, index-based products By Jovee Marie N. dela Cruz

@joveemarie

he House Committee on Economic Affairs seeks to strengthen the Philippine Crop Insurance Corp. (PCIC) by expanding its coverage and allowing it to engage in index-based insurance and reinsurance.

In House Bill (HB) 6923, Rep. Arthur C. Yap of the Third District of Bohol, panel chairman, seeks to overhaul of the crop-insurance system in the Philippines by allowing the agency to provide index-based direct insurance and reinsurance policies. “With no real and expansive agricultural, property or life-insurance protection, farmers just watch helplessly, as the weather comes to take away the sweat and tears of investments that farmers have planted,” he said. S u c h a m a n d at e w a s a l s o s e e n encouraging private insurers to offer index-based insurance as one of their products, as well. Index-based insurance is an innovative and technically sound approach to manage risks, especially for the poor and highly vulnerable farmers in the countryside, Yap said. “Unlike traditional crop insurance, in which indemnity payments are linked to individual farmer yields and losses, index insurance

links payments to independently established data, such as local rainfall, wind speed, temperature, typhoons, cyclones and historical yield data as trigger events to release payments and compensation to affected farmers and fisherfolks,” according to Yap. The measure seeks to expand the type of crops that can be insured from rice only to include corn, high-value commercial crops, livestock, aquaculture and fisher y, agro-forestr y and forest plantations. It also requires farmers obtaining production loans for rice and other crops essential to food security to insure their crops with the PCIC. The bill also authorizes the PCIC to extend life and accident insurance cover for farmers and fisherfolk. It mandates the PCIC to insure properties and facilities of the government used in agro-fishery projects, including reinsurance cover to agro-fishery and forestry

Planbank relocates for optimum MSME lending By Rea Cu

@ReaCuBM

lanbank Rural Bank of Canlubang Planters Inc. (Planbank) is looking to boost financial support for the local small and medium enterprises (SMEs) in San Pablo City, Laguna, that will enable businesses in the area to expand further and develop. According to Planbank President Dominga Rufina S. Cabangon-Chua, various SMEs that produce quality goods and services can be found in the Laguna area, specifically San Pablo City, and thus the need to increase the provision of financial services and products. “This is a relocation in terms of license. We thought that San Pablo City has more potential than that particular area [Poblacion]. One of the focuses that we have for this city are SMEs, because there’s a lot here with very good products,” CabangonChua told the BusinessMirror. The assessment led to the relocation of its branch to San Pablo City from Calamba City, Laguna, with the opening of the branch. Planbank is the largest rural bank in Laguna province. “We feel that we will be successful here [San Pablo City],” she added. Based on the 2015 census of the Philippine Statistics Authority (PSA), Laguna province has a population of around 3 million, with an estimated 266,000 in San Pablo City. On putting up new branches this year, Cabangon-Chua look to open a branch in the province of Cavite next, pointing out that its proximity to the metropolitan area would also be beneficial for the bank. “We want to look into Cavite as a different area. It’s also an exciting area right now and it’s closer to Metro Manila, so that is something that we are studying. We are definitely looking to expand in more lucrative sites,” she said. She envisions the San Pablo City branch of Planbank to generate around 50 new accounts this year as they take into consideration the expertise of their newly hired branch manager who has been working in the banking industry for more than a decade. “We are still working on the numbers. Currently, it’s the same number that we had for 2017. We are looking, at least for the year 2018, at around 52 [new accounts]. That would be a good number for us,” she added. San Pablo City Mayor Loreto S. Amante said the establishment of Planbank in the

city is a very welcome event as its presence will help more locals access its various financial services. “The city is very lucky that there is a new bank that trusts us. We welcome Planbank. I know it will help more of our citizens who are in need of financial support,” Amante told the BusinessMirror. In 2013 the ALC Group founded by Ambassador Antonio L. Cabangon-Chua acquired equity ownership of Planbank. It now has a total of 15 branches, with 11 of them in the province of Laguna, two in Batangas and another two in Bulacan. Based on 2015 data from the Department of Trade and Industry, there are 900,914 establishments in the Philippines, with 99.5 percent, or 896,839, classified as micro, small and medium enterprises (MSMEs) and the remaining 0.5 percent, or 4,075, as large enterprises. Calabarzon is host to 131,011 MSMEs if segmented geographically. L ast year t he Depar tment of Finance committed to support the swift passage of legislative measures allowing the use of nontraditional collateral for loans to ensure greater financial access by MSMEs. According to Finance Undersecretary Gil S. Beltran, there are pending bills in Congress that seek to strengthen the existing secured transactions framework and modernize the country’s warehouse receipts system. These measures help ensure financial inclusion for MSMEs. The secured transactions law seeks to establish a legal framework for the use of nontraditional collateral, such as accounts receivable and inventory when applying for loans in financial institutions. Modernizing the warehouse receipts system makes way for a computerized central registry for all warehouse receipts, which are used by farmers and other members of the agriculture sector as collateral to obtain credit. Beltran underscored the need to empower MSMEs to realize the global goal of eradicating poverty, pointing out that these enterprises “are the life force of the regional economy, account for over 40 percent of the total economy, 97 percent of total enterprises and employ half of the labor force in the region.” More than 40 percent of MSMEs in the region are hampered by lack of hard assets that can be used as collateral and a credible credit information system that banks use to make loan decisions, according to Beltran.

properties underwritten by private and government insurance companies. The plan is to offer weather index-based insurance, specifically for excessive or insufficient rainfall. The bill also allows the PCIC to offer crop reinsurance to encourage private commercia l banks to sell crop insurance. The measure also increases the authorized capital stock of PCIC from P2 billion to P10 billion. It also increases the penalty against persons who institute spurious crop-insurance claims or allow others to do so. According to Yap, millions of farmers are just exposed to the ravages of climate change. “As constant casualties of climate change, farmers need not wait for total wipeout of their resources after every calamity before getting rescued by the government,” he said. “The ability to pay out cash early, at different stages of an unfolding calamity, without having to wait for a total wipeout, is what will give our farmers and our vulnerable poor the chance to save what they can and prevent more losses and damage,” Yap added. In Africa Yap said, insurance payouts prevent farmers from selling their livestock and moving to cities. “By purchasing risk insurance, nations can now shift disaster risk and associated economic, social and medical costs away from local government units to the global capital market. In a case like this, the government can instead focus on disaster preparedness and a system for saving lives and distributing aid and payouts in times of calamities and disasters,” he said. Meanwhile, Yap urged the Senate to immediately file a counterpart to HB 6923 to allow the PCIC to engage in index-based reinsurance and insurance and to be recapitalized. “This move will clearly signal to the private sector and capital markets that the Philippines is serious about this program to help our farmers, and secure food production in our country. We must also do a good job to promote a buy-in into this project with the government, primarily the departments of Agriculture, Agrarian Reform, Environment and Natural Resources and Science and Technology-Philippine Atmospheric Geophysical and Astronomical Services, legislators, LGU heads, farm stakeholders, cooperatives and mainstream finance entities,” he said.

Celebrating continued partnership with the banking community

Chairman of the Monetary Board and Bangko Sentral ng Pilipinas (BSP) Governor Nestor A. Espenilla Jr. (third from left) leads the toast during the BSP’s Annual Reception for the banking community. Joining him are Monetary Board Members Finance Secretary Carlos G. Dominguez III (from left), Dr. Felipe M. Medalla, Peter B. Favila, Dr. Antonio S. Abacan Jr. and Atty. Juan D. de Zuñiga Jr.

n his keynote address, Espenilla cited the phrase, “Continuity Plus Plus,” which underpins the BSP’s strategic direction under his leadership. Continuity Plus Plus first appreciates that there is an already strong foundation to support a fast-growing economy and the opportunities it presents. Stability demands continued dedication maintaining and strengthening this macroeconomic foundation.

Case clippings

By Justice S J Ranada Jr. EVIDENCE–positive identification of accused Positive identification pertains essentially to proof of identity. In order that identification be deemed with moral certainty enough to overcome the presumption of innocence, it must be impervious to skepticism on account of its distinctiveness. Such distinctness is achieved thru identification evidence, which encompass unique physical features or characteristics like the face, voice or any other physical fact that sets the individual apart from the rest of humanity. People v. Ali GR 222965 06 Dec. 2017 Martires, J

Setting financial goals

egin with the end in mind. This is the famous quote from Stephen Covey. As we welcome the new year, existing goals are reviewed and new goals are created. Goals define our priorities in life. Goals define how we live our lives. Knowing where one is and knowing the destination fuels our journey. In the context of personal finance, goal setting becomes a very significant exercise we need to do. Goals can be set depending on the life stage we are in. Goals can also be set depending on the fulfillment of needs. Different life stages yield different goals. For young people, the focus can be on living for the “now” and establishing a good career. “Yolo,” which means “you only live once,” is a popular slogan for young people. “Fomo,” which means “fear of missing out,” is another popular slogan. Most financial goals can thus be short term in nature. Liquidity would be a top financial goal. Having quick access to funds for present concerns will be pursued. Saving might be present but often takes a backseat to spending. For middle-aged people, living for the “me” can evolve into living for the “we.” Goals set in this age group can be related to additional responsibility as a result of a change in civil status. Saving can become a more important activity. Budgeting can be more common with the hope of having more sustainable living. Consumption can be sacrificed in favor of long-term goals like family protection, asset generation, wealth accumulation and retirement. The balance between liquidity goals and growth goals defines success here.

Expressed in the catch-phrase is also the need for additional strategic financial-sector reforms. Among other things, the BSP governor spoke about leveraging on digital innovations to foster greater financial inclusion, digitization of the retail payment system to make it truly interoperable, deepening capital markets as an alternative source of funds and a wave of FX reforms to achieve ease of business and efficiency.

Genesis Kelly S. Lontoc

personal finance For seniors, the financial goals may be about having ample funds to support retirement. Ideally, at least some element of planning for old age must have commenced as early as possible in the previous life stages. Though it is in this stage that employment may cease, contributing to society in various other ways becomes a passionate aspiration. Financial goals can also be related to estate planning in terms of wealth preservation and equitable distribution of wealth to designated heirs. Financial goals are also set depending on needs. Abraham Maslow is famous for developing the theory of the hierarchy of needs. Basic needs have to be fulfilled first before more advanced needs come into play. The first set of needs would be the physiological needs. Financial goals in this set could be related to provision for basic items like food, clothing and shelter. The second set of needs would be the safety needs. Financial goals in this set could be related to having an emergency fund and insurance policies to prepare for fortuitous events and have better financial security. The third set of needs would be social-belonging needs. Financial goals in this set primarily evolve around family and friends.

The fourth set of needs would be esteem needs. Financial goals in this set could be related to the pursuit of a meaningful career or source of livelihood. The fifth set of needs would be the self-actualization needs. This need is all about maximizing one’s full potential as a human being. Financial goals in this set could be related to the attainment of financial freedom for both the individual and for society. Truly, having a goal, regardless of what life stage one is in or what need set one is fulfilling, is very important in life. The financial goals must be aligned with the purpose and passion of the individual. The financial goals must be ambitious. Tomorrow must be better than today. These financial goals should help one have a well-lived life and have a well-appreciated legacy. We all know that the financial goals must be “Smart.” They must be specific, measurable, achievable, realistic and time-bound. Every financial goal must be supported by a good plan. One such plan is a budget to manage inflows and outflows. A plan is only as good as its execution. The financial goals must be periodically reviewed and key milestones can be set to track progress. This new year, let us set our financial goals and commit to achieve them. Gemmy Lontoc is a registered financial planner of RFP Philippines. To learn more about personal financial planning, attend the 67th RFP program this January 2018. To inquire, e-mail info@rfp.ph or text <name><e-mail> <RFP> at 09179689774.

A4 Tuesday, January 23, 2018 • Editor: Lyn Resurreccion A6

The World BusinessMirror

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Shutdown crisis deepens as furloughs take effect

enators failed on Sunday to reach an agreement to end the government shutdown, ensuring that hundreds of thousands of federal employees were to be furloughed on Monday morning, even as the outlines of a potential compromise came into focus.

For much of the day, feverish work by a bipartisan group of senators offered a reason for cautious optimism that a deal could be reached soon. By Sunday night, Sen. Mitch McConnell, R-Ky., the majority leader, moved to delay until noon on Monday a procedural vote on a temporary spending bill—a signal that talks were progressing. In a gesture to lawmakers seeking assurances that the Senate will address the fate of hundreds of thousands of young unauthorized immigrants, McConnell said he intended to move ahead with immigration legislation next month if the issue had not been resolved by then. But the deep divisions between the parties were evident, as senators remained unable to reach a compromise even as the crisis was poised to deepen with the beginning of the workweek. Senate Democrats gave no immediate sign that they would get on board with the temporary spending bill, leaving open the possibility of another failed vote Monday that could further deepen the partisan divide three days into the shutdown. Any deal would most likely need the support of around a dozen Senate Democrats, since the chamber’s procedural rules require 60 votes. “We have yet to reach an agreement on a path forward that would be acceptable for both sides,” the Democratic leader, Sen. Chuck Schumer of New York, said after McConnell’s remarks. The best hope for a breakthrough appeared to reside with the group of about 20 senators from both parties who met throughout the weekend to try to hammer out a compromise to present to McConnell and Schumer. The group was discussing a plan in which the government would stay open through early February, to be coupled with a promise that the Senate would tackle the issue of immigration in the coming weeks. “There are, I think, people from

both parties of good will who want to have a framework for us to move forward to address all of these issues,” Sen. Chris Coons, D-Del., said Sunday evening. “But at this point, it is in the hands of leadership, and I really hope they are going to find a way forward.” A major lingering question was how a compromise might pave the way for passage of legislation to protect the young unauthorized immigrants known as Dreamers. Their status is in jeopardy after President Donald Trump moved last year to end an Obama-era program, Deferred Action for Childhood Arrivals, or DACA, that shields them from deportation. Trump gave Congress until early March to find a resolution to the issue. For as long as the government is closed, the White House has said it will not entertain demands on immigration. Senators in the bipartisan group proceeded anyway in discussing a compromise in which there would be some kind of promise that the Senate would address the issue in the coming weeks. “We want to see a commitment to take up immigration,” said Sen. Tim Kaine, Democrats-Virginia, “with a belief that we’ll get to a good result for Dreamers.” Sen. Jeff Flake, RepublicanArizona, said it was best for Trump to let the Senate work out its own solution. “I just don’t think it helps for him to be involved at all right now,” he said. Trump has vacillated on an immigration deal in recent weeks, leaving both sides confused as to what kind of legislation he might accept. The talk of promised action on immigration also raised other questions, including whether a pledge from McConnell like the one he offered on Sunday could be a significant enough assurance for Senate Democrats who are worried about the fate of the Dreamers. For

The Peace Monument in front of the Captiol in Washington D.C.

“We have yet to reach an agreement on a path forward that would be acceptable for both sides.”—Sen. Chuck Schumer of New York instance, a promise of a Senate vote on a stand-alone immigration bill would still leave the possibility that the measure would die in the House, potentially leaving the DACA issue unresolved. In a reflection of the frustration on both sides, Trump, who has largely stayed out of negotiations since the government shut down early Saturday, began the day by advising Senate Republicans to use the “nuclear option” to change Senate rules and cut Democrats out of the process if necessary. “If stalemate continues, Republicans should go to 51 percent (Nuclear Option) and vote on real, long-term

budget, no C.R.’s!” he wrote on Twitter, adding an attack on Democrats. Leaders from both parties quickly dismissed the idea, but Democrats wasted no time in pointing the finger back at Trump. Schumer’s eleventh-hour negotiations with Trump on Friday have proved to be a focal point for both parties as they have cast blame. On Sunday, Schumer said that during their meeting at the White House, Trump had “picked a number” that he wanted to fund a border wall and that Schumer had accepted in exchange for protections for Dreamers. Hours later, he said, Trump walked away from

Dismissive words on abuse scandal cast pall over pope’s trip

IMA, Peru—Pope Francis ventured into the Amazon to demand rights for indigenous groups, decried the scourge of corruption afflicting the region’s politics and denounced a culture of “machismo” in which violence against women is too often tolerated. Yet his latest visit to South America is likely to be remembered most for 27 dismissive words that sparked outrage among Chileans already angry over a notorious clerical abuse scandal and haunted the rest of his trip. “That is the enigma of Pope Francis,” Anne Barrett Doyle of the online abuse database BishopAccountability.org said Sunday. “He is so bold and compassionate on many issues but he is an old school defensive bishop when it comes to the sex abuse crisis.” Even before Francis landed in Chile for the first leg of his twocountry trip, the pontiff ’s visit seemed ripe for contention. Vandals fire-bombed three churches in the capital of Santiago, warning in a leaflet that “the next bombs will be in your cassock,” and an angry group protesting the high cost of hosting him briefly occupied the Nunciature where he would sleep. Also looming over his visit to both Chile and Peru were damaging clerical sex abuse scandals and growing apathy over the Catholic Church. In a Latinobarometro annual poll last

year, 45 percent of Chileans identified as Roman Catholic, a sharp drop from the mid-60s a decade ago. Even in deeply religious Peru, where nearly three-quarters of the population calls itself Catholic, the number of faithful has dipped notably from a generation ago. As Francis drove through the streets of Santiago in a popemobile after arriving the crowds standing by to greet him were comparably thin when compared to other papal visits. “Love live the pope!” some yelled. But others weren’t welcoming. “Stop the abuse, Francis!” one person’s sign said. “You can so you must.” Francis almost immediately dove into the thorny topic of the abuse scandal, meeting on his first full day with survivors of priests who had sexually abused them and apologizing for the “irreparable damage” they suffered. He proceeded to take on equally contentious concerns throughout the rest of his stay in Chile. He called on the government and indigenous Mapuche to find ways to peacefully resolve differences that have seen a surge of violence. And he urged Chileans to remain welcoming to a surge of new immigrants. All the while, signs that Francis himself was unwanted continued to emerge. Police shot tear gas and detained dozens of protesters outside a Mass in the capital and there were

more church burnings. Aerial photographs taken by local newspapers of all three of Francis’ outdoor Masses showed swaths of empty spaces Then came the 27 words that stunned the nation. Questioned by local journalists about Chilean Bishop Juan Barros, who abuse survivors say was present when the Rev. Fernando Karadima molested them decades ago, Francis responded that there was no proof against the bishop he appointed in 2015 and characterized the accusations as slander. “The day they bring me proof against Bishop Barros, then I’ll speak,” he said. “There is not one shred of proof against him. It’s all calumny. Is that clear?” The comment, combined with Barros’ presence at several activities during the week, cast a pall over the entire trip. “The pope’s visit in Chile turned into the worst of his five years as pontiff,” read a headline in Clarin, a major newspaper in Francis’ native Argentina. “The principal legacy of this trip will be negative because of Francis’ support of Barros,” said German Silva, a political scientist at the Universidad Mayor in Santiago. The remark followed him into Peru. Cardinal Sean O’Malley, the pope’s top adviser on abuse, and the Chilean government publicly

rebuked the pope in a remarkable correction. And near a church where the pope prayed on his final day, a banner hung from a building with the words “Francis, here there is proof” and accompanied by the photo of the disgraced founder of a Peru-based Catholic lay movement. The banner was a reference to Peru’s biggest clerical abuse scandal, involving Luis Figari, the former leader of Sodalitium Christianae Vitae. An independent investigation found Figari sodomized recruits and forced them to fondle him and one another. Still, despite the outrage that case has stirred in Peru, the pope received a warmer reception here. Thousands waited to greet him each night as he retired to the papal embassy in Lima and people lined the streets wherever he went. Peruvians largely praised his comments condemning corruption in a nation that has been embroiled in Latin America’s largest graft scandal. They also welcomed his call to protect the Amazon and stop crimes like sex trafficking and femicide that plague much of the region. Andrew Chesnut, the Catholic Studies chair at Virginia Commonwealth University, said Francis likely deepened wounds in Chile. But in Peru, “he has helped alleviate the pain of a polarized society, though the medicine won’t last long.” AP

a tentative agreement. “I essentially agreed to give the president something he has said he wants, in exchange for something we both want,” Schumer said on the Senate floor. “The president must take yes for an answer. Until he does, it’s the Trump shutdown.” McConnell has proposed that the temporary spending bill expire on Feb. 8, about a week earlier than the date set in the version of the bill that was passed last week by the House but then failed in the Senate. The proposed Feb. 8 expiration date was designed to at least partially accommodate a demand by Democrats, who are mindful of preserving what leverage they have, that any temporary funding extension be shorter than the House proposal. But the more significant piece of any possible deal to end the shutdown would be what other strings are attached—particularly when it comes to the politically contentious issue of immigration. Senators in the bipartisan group

had made clear Sunday that they were eager to bring about an end to the crisis, knowing that they were working against the clock. “Resolution gets more difficult the longer we wait,” said Sen. Heidi Heitkamp, D-N.D. Lawmakers in the House, who had been scheduled to recess for the week, were mostly left to watch and wait as their Senate colleagues tried to come together. House Speaker Paul Ryan, RWis., said Sunday that House Republicans had agreed to pass McConnell’s stopgap proposal if it made it out of the Senate. The onus of ending the shutdown, he said, was on Senate Democrats, and he urged them to vote to reopen the government and then restart separate immigration negotiations. “This is solely done by the Senate Democrats,” Ryan said on CBS’ “Face the Nation.” “It’s absolutely meaningless. T hey shut down the government over a completely unrelated issue. The New York Times

Dreyfus teams up with banks for first agri blockchain trade

he blockchain is now part of the route from farm to table. Louis Dreyfus Co., one of the world’s biggest foodstuffs traders, teamed up with Dutch and French banks in December for what it says is the first agricultural commodity trade to use the ledger-based digital technology known as blockchain. The 166-year-old Rotterdam-based trading house used a blockchain platform to sell a cargo of US soybeans to China’s Shandong Bohi Industry Co. Dutch banks ING Groep NV and ABN Amro Bank NV, along with Parisbased Societe General SA, helped LDC and Bohi utilize digitized documents for the deal, including contracts, letters of credit as well as government inspections and certifications. By automatically matching data in real time, avoiding duplication and the need for manual checks, document processing was reduced to a fifth of the time, LDC said in a statement. In addition, the transaction time was cut in half from two weeks to one, ING’s global head of trade commodity finance, Anthony van Vliet, said in an interview. “The key objective is to design something that will be adopted in the market,” van Vliet said. “It’s clear that a traditional, somewhat old-fashioned industry working with largely paper documents needs a bit of a digital upgrade.”

Cutting costs

Commodity traders and trade finance banks, a sector dominated by Dutch and French lenders, are embracing blockchain as a way to reduce costs and administrative tasks, while improving record keeping and tracking for trades. The biggest traders conduct thousands of transactions per year valued in the billions of dollars, but those deals typically have low profit margins. “We not only proved that this blockchain transaction is technically possible, but also that it yields what it promises,” said Karin Kersten, global head of trade & commodity finance at ABN Amro. “The trade saved labor and time, but also reduced the risk of fraud or human errors.” For blockchain to succeed in helping traders cut costs and deal times, however, industrywide adoption of standardized platforms and systems will be needed. That’s why banks are teaming up with the biggest trading houses, such as LDC, on early blockchain tests. “Distributed-ledger technologies have been evolving rapidly, bringing more efficiency and security to our transactions,” LDC Chief Executive Officer Gonzalo Ramirez Martiarena said in the statement. “The next step is to harness the potential for further development through the adoption of common standards.” Bloomberg News

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Tuesday, January 23, 2018

Merkel closes in on fourth term with familiar ally

hancellor Angela Merkel moved forward in her bid to form a fourth-term government after her prospective coalition partner agreed to shelve its misgivings and enter negotiations on a common policy platform for Germany.

Merkel, 63, welcomed the outcome of Sunday’s vote by Social Democratic Party delegates in Bonn following what she termed an “intensive and contentious” debate. The chancellor’s Christian Democrats and their Bavarian allies will coordinate on strategy Monday, allowing talks aimed at a resumption of the so-called grand coalition to begin as soon as Tuesday. The euro rose in early Asian trading on the prospect of an end to a near-four-month political stalemate that has gripped Europe’s biggest economy since last fall’s inconclusive election. CDU leaders are keen for talks to wrap up within two-to-three weeks, a timetable that would enable Merkel to move toward re-inauguration by Easter. The decisive moment came at a special party convention called by the SPD to decide whether to move on to formal coalition talks on the basis of a joint policy outline reached between the two party blocs on Jan. 12. But rather than achieving unity, five hours of impassioned debate led to a show of hands that appeared too close to call. A subsequent formal count yielded the desired majority but

underscored party divisions that could yet spell more political uncertainty ahead for Europe’s biggest economy. “Many who voted in favor weren’t conv inced w ith their heart—and that’s going to affect the negotiations,” said Josef Janning, head of the Berlin office of the European Council on Foreign Relations. The upshot is that the party’s decision to give its members the final say over any coalition pact is emerging as a bigger-thanexpected hurdle. The euro rose 0.4 percent early on Monday in Sydney, but later gave up its gains to trade unchanged at $1.2226.

Party identity

Opposition to another grand coalition was led by young and leftist grass-roots members, who favor a period of renewal outside of government. They argue that allying with Merkel’s bloc for eight of her 12 years in power has robbed the party of a clear identity, sapping voter support. Party Chairman Martin Schulz, who led the SPD to its worst result since World War II in the election, made the case for another tie-up as “the more courageous path.” He pledged to press for

expanded commitments on health care, hardship rules for refugees who want to bring family members to Germany and curbing layoffs of temporary workers. A go-ahead from party members for the coalition is far from guaranteed, Matthias Miersch, head of the SPD’s left-wing caucus, said in an interview. Merkel’s bloc “now has to shift” on policy, he said. That idea received short shrift from leaders of Merkel’s party who met in Berlin later on Sunday. They welcomed the result in Bonn, but warned against any attempt to revisit the draft agreement reached in marathon talks earlier this month. “It’s not the CDU’s role to make SPD members feel good,” said board member Julia Kloeckner. The result puts Merkel’s party critics on the backfoot for now, and renders less likely a repeat election or a minority government, both options filled with uncertainty. Italy’s Prime Minister Paolo Gentiloni praised the vote as a “step forward for Europe’s future.” Merkel is already stepping back into the debate on Europe’s future, visiting French President Emmanuel Macron last Friday and scheduling her first speech in three years to the World Economic Forum in Davos, Switzerland, for Wednesday. Europe topped the list of initial policy priorities reached between the two sides, although polls suggest that dealing with the ongoing fallout of the refugee crisis of 2015-2016 is the most urgent matter for voters. For Merkel, Sunday’s outcome offers some relief, Carsten Nickel, a managing director with Teneo Intelligence in Brussels, said by email. “But the real test is of course still ahead.” Bloomberg News

S. Koreans burn Kim’s photo as N. Korean band leader passes

EOUL, South Korea—Conservative activists burned a large photo of North Korean leader Kim Jong Un as the head of the North’s extremely popular girl band passed by them on Monday during her visit to Seoul amid a flurry of cooperation between the rivals ahead of next month’s Winter Olympics in the South. Hyon Song Wol, a Pyongyang celebrity who heads the Moranbong Band hand-picked by Kim, began a two-day visit on Sunday, triggering media frenzy in South Korea about the woman who is also in charge of the North’s artistic performance during the Olympics. It has been rare for such a highprofile North Korean figure to travel to South Korea in recent years as they saw their ties deteriorating over the North Korean nuclear standoff before they recently abruptly sought to improve ties this month ahead of the Feb. 9-25 Olympics. After her visits to potential venues for North Korean performances in an eastern city, Hyon arrived back Monday morning at the Seoul railway station where she saw about 150 to 200 activists rallying against her visit and recent inter-Korean rapprochement deals. “Pyeongchang Olympics? We oppose Kim Jong Un’s Pyongyang Olympics,” they chanted referring to the North Korean capital. Hyon saw the activists but did not react. After she left the scene, the demonstrators used a blowtorch to burn Kim’s photo, a North Korean flag and a “unification flag” that athletes of the rival Koreas plan to carry together during the opening ceremony of the Olympics. Police used fire extinguishers to quench the fire, but the activists later stamped

South Korean protesters burn a North Korean and Unification flag during a rally against a visit of North Korean Hyon Song Wol, head of a North Korean art troupe, in front of Seoul Railway Station in Seoul, South Korea, on Monday. AP

on Kim’s photo and the flags and burned them. Seoul police plan to investigate the protesters, according to Yonhap news agency. Hyon’s arrival has made her the subject of intense South Korean media attention, with photographers following her every move and TV stations aggressively reporting not only her career and band but also her fox-fur muffler, boots and facial expressions. The band, with the young women in short skirts and high heels dancing and singing odes to Kim, draws global attention even though little information is available about it or about Hyon to outsiders. South Korean media say she is an army colonel and is close to Kim, but little else is known. South Korea’s liberal government led by President Moon Jae-in sees North Korea’s participation in the Games—both in sporting events and cultural exchanges—as a way to calm tensions caused by Pyongyang’s recent nuclear and missile tests

and war of words with the United States. The two Koreas agreed to field their first unified Olympic team, in women’s hockey, and have their athletes march together under the joint flag depicting their peninsula during the Feb. 9 opening ceremony. Some of the Olympic proposals like a unified hockey team and the use of the joint flag have caused a heated debate in South Korea, reflecting changes in public views toward North Korea which has been rapidly expanding its nuclear and missile arsenals in recent years. South Korea’s main conservative opposition party expressed its complaint over what it calls too much security arrangements provided for Hyon. “The Moon government is offering gracious hospitality to a North Korean army colonel as if she’s a queen... Did they forget North Korea had until recently been threatening to turn South Korea into a sea of fire with its nuclear weapons and missiles?” a party statement said. AP

Deaths of Canadian billionaire, wife a tantalizing mystery

In this December 21, 2017 file photo, Jonathon Sherman wipes his tears as he and his sister Lauren walk to the stage during a memorial service in Mississauga, Ontario, for their parents Barry and Honey Sherman, who were found dead inside their mansion. AP

here were no sig ns of forced entry on the cold December morning when a Canadian billionaire businessman and his wife were found dead inside their mansion, reportedly hanging from a railing at the edge of their indoor pool. Since that time, investigators have scoured the 12,000-squarefoot home, hauled away the couple’s cars and even checked the sewers in one of Toronto’s most exclusive neighborhoods for clues. But police haven’t made any arrests or announced a search for any suspects nor have they said practically anything publicly about the deaths of drug company founder Barry Sherman and his wife, Honey. Sherman was a fiercely competitive businessman, once musing that a rival might want to kill him. The day after the bodies were found, prominent media outlets, including the Toronto Star, quoted unidentified police officials as saying it appeared to be a murdersuicide. But that theory, which was never publicly confirmed by authorities, was dismissed out of hand by people who knew the philanthropic and politically connected couple, saying it would be wildly out of character. Such a scenario was also ruled out by the couple’s four adult children, who hired their own investigator and pathologist to conduct second autopsies on the Shermans, who were killed days before heading south to their winter home in Palm Beach, Florida. “Nobody will support a theory of either murder-suicide or double suicide,” said Brian Greenspan, a lawyer for the family. “To everyone who knew them it’s inconceivable.” Toronto police, called “irresponsible” by the family for the early reports of a murder-suicide, have declined to make any more public statements, aside from calling the deaths “suspicious,” leaving the media and people who knew the couple to speculate about what has become a tantalizing mystery. The Star, citing unidentified experts hired by the family, reported Friday that the couple were tied to the rail with men’s belts, which resulted in the “ligature compression” that was the cause of death. The paper also said they had marks on their wrists that suggested their hands had been tied together, were wearing winter coats that had been pushed down their shoulders, as if to restrain them, and had no drugs in their system that would have caused their deaths. Greenspan declined

to confirm the report. Citing an unidentified source, Canadian Broadcasting Corp. said the family’s private investigators believe the Shermans were murdered by multiple killers but provided no evidence to back up the claim. Those investigators have not been to the house. Sherman, 75, was known for litigiousness and aggressive businesses practices as he developed generic drug manufacturer Apotex Inc., which has a global workforce of about 11,000. He conceded he made enemies in “Prescription Games,” a 2001 book about the industry. “The branded drug companies hate us. They have hired private investigators on us all the time,” he said. “The thought once came to my mind, why didn’t they just hire someone to knock me off? For a thousand bucks paid to the right person you can probably get someone killed. Perhaps I’m surprised that hasn’t happened.” Canadian Sen. Linda Frum, a close friend of the Shermans, said the comment is chilling in retrospect. “That sets off alarm bells for me,” she said. “The fact that he identified that as a possible threat to his life has to be taken seriously.” Sherman also faced legal action from cousins who said they had been cut out of the company over the years. A judge dismissed the claim just months before the couple was found dead. A Toronto-born graduate of MIT and the University of Toronto, Sherman founded the company in 1974. He married Honey in 1971. Canadian Business magazine recently estimated his worth at 4.77 billion Canadian dollars ($3.65 billion), making him the 15th richest person in the country. As they became wealthy, the couple became known in Canada for philanthropy. They gave tens of millions to the United Jewish Appeal, gave money to a geriatric hospital in Toronto and sent medicine to disaster zones. Prime Minister Justin Trudeau attended the funeral and Sherman is posthumously due to receive one of the country’s highest civilian honors this year. Frank D’Angelo, a close friend of Sherman, said the businessman complained of fatigue but he chalked it up to working long hours and not eating well. “It was never about depression,” he said. “I never heard that in almost 20 years.” Honey Sherman, 70, a University of Toronto graduate who met

her husband while volunteering at a local hospital, spent her time raising money for charities and was active in Toronto’s Jewish community. She had recently been treated for cancer and suffered from a serious form of arthritis but was outgoing and friendly. Friends and family say the couple was busy making plans for the future. They had recently listed their home in Toronto for 6.9 million Canadian dollars and they were building a new home in the city. “They loved each other. They loved life,” Frum said. “Almost every conversation I ever had with Barry was about how much left he had to do in his life.” She is angry police haven’t publicly rejected the theory of murdersuicide and have been quiet since their early leaks. “Now they are overdoing it in the other direction, having been too loose lipped in the first place about their foolish theories. It’s definitely been a case of how not to handle a police investigation,” Frum said. Their bodies were discovered Dec. 15 by a maid and a real estate agent. Today, the home remains cordoned off behind yellow police tape and under constant watch by officers, and the family’s private investigators haven’t been allowed inside. Pol ice are sti l l apparent ly searching the tree-lined streets of the northern Toronto neighborhood for clues. Greenspan said the family was told twice that police were done with the property, only to have them insist they need more time. “We’re encouraged that they are being thorough,” Greenspan said. “We don’t believe there has been a conclusion reached. I don’t want to get into it further, but there’s no question that our pathologist and our officers and the people who are involved in our side of this investigation, we all have a view.” Former Toronto homicide detective Mark Mendelson said the fact that police initially said they weren’t looking for any suspects and there were no signs of forced entry supports the idea of a murder-suicide or double suicide but says those preliminary statements may not give the whole picture. “The other side of the equation is that maybe those two statements came out a little prematurely given that the investigation was really in its infancy,” Mendelson said. AP

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Tuesday, January 23, 2018 • Editor: Efleda P. Campos

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P63-M property of closed banks up for bid in Mindanao By Manuel T. Cayon

@awimailbox Mindanao Bureau Chief

AVAO CITY—The properties of closed banks in Mindanao are up for bidding in next month’s round of public auction by the Philippine Deposit Insurance Corp., (PDIC) its communication executive said.

The properties, totaling 104, have an aggregate disposal price of P63 million, but the actual turnout may be higher, which PDIC hoped would help them settle more pending liquidation from creditors and the uninsured portion of deposits of the closed banks. A PDIC invitation to bid listed the properties from 11 provinces in Mindanao and two properties in Leyte, and consisted of commercial, agricultural and residential properties. The highest appraised property, valued at P27.6 million, is in Barangay Carmen in Cagayan de Oro City. It is described as a “commercial lot with improvement” and has a lot size of 798 square meters (sq m). Jose Villaret, PDIC vice president of the corporate affairs group, said the properties auctioned have their minimum price tagged and were based on current market appraisal. Bidders must pay 10 percent of this pegged value to join the bid on February 27 at the regional office here of the Bangko Sentral ng Pilipinas (BSP). The properties were the assets of 15 rural and thrift banks that closed during the last 15 years, said Arlene Firmeza, PDIC CEO 1 of the asset management and disposal division. The bulk of the properties, to-

talling 33, are located in Cagayan de Oro City and Misamis Oriental, followed by Sultan Kudarat, with 17, and Davao del Sur, with 16. The rest are in Iligan City and the rest of Lanao del Norte (14), North Cotabato (10), Bukidnon (8), Agusan del Norte (2) and one each in Agusan del Sur, Surigao del Norte, South Cotabato and Compostela Valley. Two residential lots are up for auction in Leyte. The public bidding here would be the PDIC’s third round. The first two rounds would be held in Metro Manila, with the first round to be held on February 17, selling 79 properties, 10 motor vehicles and two generator sets. They have a total minimum disposal price of P93 million. The properties are agricultural, commercial and residential lots in Metro Manila and the provinces of Batangas, Bulacan, Cavite, Ilocos Sur, Laguna, Misamis Oriental, Nueva Ecija, Pampanga and Rizal, including a fishpond in Malabon City. The second round on February 19 would be “for the bulk sale of 438 residential lots located in Green Farm Royale Subdivision, Barangay Pulong Bunga, Silang, Cavite.” The bulk sale involves a total lot area of 94,514 sq m. “A reserve price is set, and bidders

may submit the best offer for all 438 lots,” the PDIC said. Villaret said the PDIC was also in the management of unliquidated assets of the closed banks, which have also been placed in the receivership of the PDIC. These assets include units in condominium buildings, membership clubs and farm harvests. “We manage their operations to make them still operational until such time when they are ready for disposal,” he said. “We also do collection of the unpaid loans of clients after the banks have closed,” Villaret added. Although some borrowers would complain why they still have to settle their outstanding debts after the banks closed, he said, “But they would agree to settle them anyway to reacquire their properties held as collateral.” “After all, these are their houses, or their cars, or office buildings which are essential,” Villaret added. The proceeds of the sale would go to settle the remaining accountability of the closed banks to their creditors, which include other banks, and even the BSP, the former employees, suppliers, the uninsured portion of the deposits beyond the insured P500,000 and, onto the last line, the owners and stockholders of the former bank. Villaret said the total value of the assets of the closed banks, if all would be disposed, may likely be higher than the time when they were held in collateral for loans, such as prime lots in prime locations in commercial centers. Some may depreciate, though, such as houses unmaintained for years, or unless some occupants were still in these properties. During the last two years, closure of mostly small banks has improved, from 22 closures in 2016 to only seven last year. “Maybe the environment has improved,” he said.

SBMA signs accord with IP group for Ayta conservation project

LEADERS of the Magbukun Ayta tribe hail the signing of an agreement by Subic Bay Freeport Metropolitan Authority Chairman Wilma Eisma (seated, left) and Subic Indigenous Peoples Assistance Group President Betty Fielder (seated, right) to implement a conservation program at the tribe’s territory within the Subic Bay Freeport Zone. By Henry Empeño | Correspondent

UBIC BAY FREEPORT—The Subic Bay Metropolitan Authority (SBMA) formally signed an agreement with the Subic Indigenous Peoples Assistance Group (Sipag) last week for the implementation of a conservation program to benefit the Magbukun Ayta tribe in this free port. SBMA Chairman and Administrator Wilma T. Eisma signed the agreement with Sipag President Betty Fielder in the presence of Magbukun tribe leaders on Wednesday at the SBMA office. Eisma said the SBMA will give its all-out support to the program as it complements the agency’s conservation and environment-protection program. “We have pledged our all-out support to this project because it strengthens our fundamental advocacy to protect the natural environment of the Subic Freeport,” Eisma said. “Of

course, part of the effort goes to the conservation of the indigenous Ayta culture, and we also support that.” Under the agreement, the SBMA allowed Sipag to use a building at the Naval Magazine area in the Freeport for the establishment of the proposed Ayta Cultural Skills Development and Livelihood Training Center. Sipag had launched its Indigenous Communities Conservation Area (Icca) project last December under the auspices of the United Nations Development Programme (UNDP) to help protect and preserve the indigenous Ayta environment and culture here. Fielder said the project would be implemented with the support of the local government unit of Morong, Bataan, and the Philippine Association for Intercultural Development. The project places the Magbukun Ayta tribe at the forefront of conservation efforts, since they live in the conservation site, which forms a part of the Subic Bay Freeport Zone.

Under the Icca program, residents living within or near the conservation area are tasked to serve as protectors of the environment, while the local government unit takes the lead in implementing conservation and protection activities. The UNDP said Iccas are spaces de facto governed by indigenous peoples or local communities with evidently positive outcomes for the conservation of biological and cultural diversity. The UNDP also said Iccas can be classified as sacred areas or ritual grounds for the indigenous communities residing near it, and may include forests, mountains, shorelines, wetlands, fishing areas and other bodies of water. Project officials said that, with the Icca program, the continuation, revival or modification of traditional practices, or even new initiatives, may succeed in protecting and restoring natural resources and cultural values in the face of new threats or opportunities.

CA denies plea of residents to ban mining in Zambales By Joel R. San Juan @jrsanjuan1573

HE Court of Appeals (CA) has denied the plea of some residents of Santa Cruz, Zambales to reverse its earlier ruling denying their petition for the issuance of a writ of “kalikasan” with permanent environmental protection order (Pepo) against all mining operations in the province. In a five-page resolution penned by Associate Justice Renato Franciso, the CA’s Former Special 14th Division affirmed its May 22, 2017, decision that also lifted the provisional writ of kalikasan issued by the Supreme Court in June 2016 in favor of petitioner Concerned Citizens of Santa Cruz, Zambales (CCOSZ). The appellate court did not give weight to the argument of the petitioner that it is the court’s duty to protect and advance the constitutional right of the people to healthful and balanced ecology. The petitioner added it is also the court’s duty to make sure there is strict compliance to the suspension and closure orders

issued by the Department of Environment and Natural Resources against mining operations in the province. It insisted that a Pepo should have been issued against respondent mining firms instead of a temporary environment protection order. In the CA’s May 22, 2017, decision, the CA ruled the closure order issued by then-Environment Secretary Regina Paz L. Lopez against the operations of five mining companies in the province had rendered the petition moot and academic. In its petition, the CCOSZ claimed their constitutional right to a balanced and healthful ecology is being violated by five mining companies, namely BenguetCorp. Nickel Mines Inc., Eramen Minerals Inc., LNL Archipelago Minerals Inc., Zambales Diversified Metals Cor p. and Shangfil Mining and Trading Corp. The petitioners noted their mining activities are destroying the irrigation system and the ecosystem in Santa Cruz, Zambales, and its neighboring municipality of Candelaria, Zambales, extending up to Infanta, Pangasinan.

The mining firms’ “unsystematic” mining practices, the petitioner said, are causing water, air and soil pollution, as well as heavy laterite siltation of river systems, coasts, farmlands, fishponds and residential areas. Forest denudation caused by mining also could result in soil erosion and exacerbate flood problems, the petitioners said. The livelihood of residents is, likewise, adversely affected, they added. In denying the petitioner’s motion for reconsideration, the CA noted it failed to present new arguments that would warrant the reversal of its May 22, 2017, decision. “A perusal of the motion for reconsideration reveals no new and meritorious arguments and yields mere rehashed arguments, which had already been exhaustively discussed and squarely passed upon by this Court in the Resolution sought to be considered,” the CA declared. “Accordingly, petitioners motion for reconsideration is hereby denied for lack of merit,” it added. Concurring with the ruling were Associate Justices Jose Reyes Jr. and Apolinario Bruselas Jr.

PRC warns public in Albay re adverse effect of volcanic ash on human health ecology By Claudeth Mocon-Ciriaco Correspondent

HE Philippine Red Cross (PRC) advised affected communities to be vigilant on the health hazards of volcanic ash to human health as alert level 4 was raised over Mayon Volcano in Legazpi, Albay. PRC Health Services said exposure to falling ash may cause a number of health problems, especially respiratory illnesses, such as nose and throat irritation, coughing, bronchitis-like illness and discomfort. Eye irritation and minor skin problems are also among the bad effects of exposure to volcanic ash. It can also cause vehicular mishaps, resulting in injuries and casualties because of slippery roads and poor visibility in areas affected by the ashfall. Volcanic ash consists of powderto sand-sized particles blown into the air by an erupting volcano. “ The Philippine Red Cross

already activated its health volunteers to disseminate an awareness campaign on the health hazards that may ensue to individuals living around an erupting volcano,” PRC Chairman Richard J. Gordon said. As part of the dissemination campaign, the PRC also educated the affected communities on ways to cope with ashfall and advised the residents to seek immediate medical attention in case of health concerns caused by volcanic ash. “We urge affected individuals to wear dust masks or anything to cover their nose and mouth to protect them from catching harmful emissions from the volcanic ash. We also advise the residents to report immediately to their local health centers and nearest PRC chapter in case of health concerns from volcanic ash,” Gordon said. To date, the PRC has already provided dust masks to 4,000 individuals. Another 4,000 dust masks were also sent last Sunday in distribution in the coming days. A total

of 60 goggles and 300 N95 masks were provided to affected individuals to avoid the harmful effects of volcanic ash. The PRC also conducted hygienepromotion activities to a total of 1,153 individuals in various evacuation centers in Albay. Five water bladders were already installed to provide the affected individuals access to clean and safe water. Meanwhile, PRC assets, such as three water tankers, two hot-mealson-wheels, three trucks and one radio team with communication equipment were all deployed. The PRC, as the foremost humanitarian organization in the country, has 103 chapters with 2 million volunteers nationwide always first, always ready and always there to provide round-the-clock humanitarian assistance, especially to the most vulnerable. PRC services include disaster management, health, welfare, blood, volunteer service and Red Cross youth.

Exec: LGU plans to become part of LLDA’s sustainable devt plans for Laguna de Bay

AGUNA Lake Development Authority (LLDA) General Manager Joey Medina said the development plans of local government units (LGUs) would form part of the agency’s long-term development plan for Laguna de Bay. He added the LLDA would harmonize the policies and programs of various stakeholders within the Laguna de Bay region with that of the LLDA to ensure sustainable development and boost the production of the country’s largest freshwater lake. Medina said the agency will initiate separate meetings with various stakeholders, including the national government agencies, LGUs, people’s organizations, fishermen’s organizations, nongovernmental organizations, academe and religious institutions to come up with a comprehensive plan for Laguna de Bay. The LLDA chief said that, in line with President Duterte’s

directive, the LLDA will prioritize small fishermen in granting rights over the multipurpose and multiresource lake. While the Laguna de Bay has various uses, fishery production is the dominant economic activity. It is the country’s largest aquaculture hub, with around 13,000 of the 90,000-hectare lake surface being used to raise bangus and tilapia. Medina, a former mayor of Pateros, said the LLDA is currently working to revise the Zoning and Management Plan (Zomap) for Laguna de Bay and is eyeing to come up with the final draft within the first quarter of the year. Last revised in 1999, the Zomap designates specific areas for the fish cage and fish pen operation, as well as assign navigational routes of fishing and passenger boats that operate in Laguna de Bay. The target is to come up with a revised Zomap for approval by the LLDA’s board of directors headed by

Environment Secretary Roy A. Cimatu, who sits as chairman of the LLDA within the first quarter of 2018. “In Januar y and Februar y, we will conduct consultations with various stakeholders. We have already started the process,” Medina said. Medina said he wants to explain the LLDA’s plans and, at the same time, gather inputs from various stakeholders, particularly LGUs. Medina wants to integrate the LGUs’ plans and programs with that of the LLDA. The inputs of the LGUs, he said, would form an integral part of the revised Zomap. He noted that every LGU has its own development plans and agenda, citing, for instance, two Laguna LGUs that plan to build a hydropower plant in their respective municipalities. Some LGUs, he added, also have development plans along the shoreline of the lake. Jonathan L. Mayuga

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Editor: Angel R. Calso • Tuesday, January 23, 2018 A9

To ICO or not to ICO? That is the question for today’s start-up companies raising funds

By Yoolim Lee | Bloomberg

ung Kyaw Moe and Jun Hasegawa have a lot in common. Both are entrepreneurs. Both left home to seek their fortunes. Both are now working on digitalpayment projects with operations in Southeast Asia. But when it came to collecting money to fund their start-ups, they took opposite paths. Aung, 42, is raising as much as $30 million in venture capital with the goal of, perhaps, going public in a few years. Hasegawa, 36, brought in $25 million through a so-called initial coin offering (ICO), an unregulated sale process that’s exploded in popularity in the last year. His company’s tokens, OmiseGO, are already worth more than $2 billion. “It’s been crazy,” says Hasegawa, cofounder and CEO of the start-up Omise. “It took only six months to get here.” Aung watched Omise’s rocket ride with wonder and a touch of envy. Should he try an ICO, too? While venture money can be harder to get, he ultimately decided on that route and said ICOs are too shaky a foundation to build a business on. “If it all came crashing down one day, you would have no control,’’ said Aung, whose start-up is called 2C2P, for Cash and Card Payment Processor. “I like to go to bed with peace of mind.’’ The rivals illustrate a dilemma start-ups are now facing the world over. Should they pursue traditional venture capital with its predictability and limitations or turn to ICOs where there is quick money, volatility and innumerable unknowns?

ICOs are winning support with fund-raisings jumping to more than $6.8 billion in 2017, up from $151 million in 2014, 2015 and 2016 combined, according to research firm Smith + Crown. Telegram Inc., an encrypted messaging service, is planning to raise at least $1.2 billion through an initial coin offering, which would be by far the largest ever. Many people buy into ICOs for a simple reason: The coins have soared in the past year, driven in part by a surge in Bitcoin of more than 10 fold. Omise and 2C2P took different routes to their decisions. Aung, a Myanmar-born computer programmer, founded his start-up in 2003 in Bangkok. He helps customers like Thai Airways, Lazada and Zara handle online payments with credit or debit cards—or cash payments at convenience stores from people without bank access. The Japanese Hasegawa and Thai cofounder Ezra Don Harinsut started Omise in Bangkok a decade later as an e-commerce firm, then pivoted to payments. Their OmiseGO network aims to let anyone carry out financial transactions with cryptocurrencies, such as ethereum and Bitcoin, as well as fiat money like the dollar. They want to move people from traditional banking into the decentralized world of digital currencies.

Moe Bloomberg

They may not have been able to raise venture money even if they tried—their crypto service hadn’t launched last year when they were seeking funds. The ICO was also easier because they didn’t have to give up equity in the company. People who buy OmiseGO tokens —or just OMG—don’t get shares in Omise; rather they get currency they’ll be able to use on the company’s network. Hasegawa said some of his existing investors were reluctant to back the project. But because the company wasn’t selling equity, they didn’t need shareholder signoff. They posted the ICO whitepaper— essentially a fund-raising plan—online last June without any detailed financials. A few weeks later, they had more than enough interest. “When we told them we got more than $200 million in commitments,

they were like, ‘Whaaaat?,’” said Hasegawa. Omise owns 30 percent of the tokens, now worth more than $500 million. The ICO money was aimed at helping the company launch an ethereum-based technology for digital wallets by the fourth quarter, but the project hasn’t started yet. Hasegawa

says a limited version of the network is on track for mid-2018. Aung tries to avoid making promises he can’t keep. His company hands out t-shirts to employees emblazoned with “Say Less, Do More.” Dmitry Levit, the first venture capitalist to back 2C2P, recalls that when his firm was scouting for deals

in Southeast Asia in 2011, many potential online sales for airline tickets, e-commerce goods and bookings for services got canceled due to unreliable payment options. He quickly decided 2C2P had the best shot at a solution. “We realized that what Aung was building is a very good fit,’’ said Levit, a partner at Cento Ventures. Today 2C2P counts Facebook Inc. and some 30 airlines among its 350 large customers. In 2017 the firm’s revenue growth hit 111 percent, up from 99 percent in 2016, as it processed almost $6 billion of payments, according to Aung. His backers include GMO Venture Partners, part of Japan’s GMO Internet Inc., SafeCharge International Group Ltd. and Amun Capital in Hong Kong. With large customers and a fastgrowing business, Aung won’t jeopardize his prospects by experimenting with a new form of financing. “2C2P will become profitable this year,” he said. “That’s what I’m going to focus on.” It’s a global debate. China banned ICOs last September, part of a broader crackdown on cryptocurrencies. Regulators in Hong Kong and Singapore have also warned against ICOs, citing fraud concerns and money-laundering risks. In the US the securities regulator has stopped coin offerings it deems too similar to stock sales. “Is it really better to have an unregulated, open system where anything can happen?’’ said Damian Adams, a Singapore-based partner at law firm Simmons & Simmons. Omise’s Hasegawa believes ICOs are the beginning of a financial revolution. “All the great companies in the world, they always changed and pivoted their business models,” he said. Aung isn’t convinced. “If it sounds too good to be true, it usually is,” he said.

Digital eyewear, 3D holograms challenge hidebound med schools By Jason Gale | Bloomberg

hafi Ahmed dons a pair of digital sunglasses and explains how the tiny lenses built into its black plastic frame, which can capture high-resolution images, are transforming how doctors get trained in operating rooms. The British colorectal surgeon used Snap Inc.’s high-tech spectacles a year ago to walk rookie physicians and millions of curious viewers through a hernia operation using the Snapchat photo-sharing app. In 2018 he plans to beam his avatar into operating rooms with so-called immersive technology, which spans everything from military training to adult entertainment, and promises to support the next generation of doctors with real-time supervision and tutelage. “Doctors do not need to feel out of their depth, and this technology will allow them to get help whenever required,” says Ahmed, whose early adoption of digital technology and social media has seen him recognized as the planet’s most-watched surgeon, with more than 2 million views and 50 million Twitter posts for the Snapchat surgery alone. “We all need support and help when faced with a tricky situation.” Ahmed’s well-publicized, public approach rankles some members of a very conservative profession. Yet, he says it represents one of the best ways to meet the World Health Organization’s (WHO) call to “scale up transformative, highquality education” and plug a predicted global shortfall of 15 million health workers by 2030.

A report by the Lancet Commission on Global Surgery estimated in 2015 that 5 billion people lack access to safe, affordable surgical and anesthesia care, leading to about 17 million deaths annually. Saving lives will require a doubling of the surgical work force, or an extra 2.2 million surgeons, anesthetists and obstetricians over 15 years, the report said.

have traditionally cost from $30,000 to $300,000, according to a World Economic Forum report on emerging technologies. Facebook Inc.’s Oculus Go wireless headset, meant to be the company’s most accessible VR device, will cost $199 when it’s released in early-2018.

Rapid growth

‘Great interest’

“It’s not just that we have a shortage of health professionals, we also, as a consequence, have a shortage of teachers,” said Josip Car, an associate professor of health services outcomes research at Singapore’s Nanyang Technological University’s Lee Kong Chian School of Medicine. Car is working in collaboration with the WHO on the world’s largest systematic review of evidence on the effectiveness of digital learning. It’s a field, he adds, that is attracting “great interest,” but which requires careful evaluation. “The evidence appears to suggest that, on the whole, these technologies are likely to be equivalent to traditional modes of education,” Car said in a telephone interview. “If this turns out to be so, that’s very good news because many of them allow scalability and flexibility of learning.” Already, technological innovations are increasing the automation of diagnoses and personalized treatments, and medical schools are incorporating them into their teaching. For example, California’s Stanford Medicine is combining imaging from MRIs, CT scans and angiograms with a new software system to create a three-dimensional model that

Surgeon Shafi Ahmed poses for a photograph wearing a Samsung Electronics Co. Gear VR headset inside his operating theater at the Royal London Hospital, part of the Barts Health NHS Trust, in London, United Kingdom. Bloomberg

physicians and patients can see and manipulate.

in the operating room at the Royal London Hospital.

‘Ripe for disruption’

Connecting people

“Medical education is ripe for disruption,” said Marc M. Triola, associate dean for educational informatics at NYU Langone Health in New York. “Cutting-edge technologies, such as virtual and augmented reality, may quickly become standard-of-care and mainstream.” Ahmed used Microsoft Corp.’s HoloLens headsets to virtually bring together surgeons from the BMI London Independent Hospital and Tata Memorial Hospital in Mumbai to operate together on a bowel-cancer patient last October. Each colleague was able to view tumor scans that appeared as 3D holograms, and could “see” each other as graphic avatars, standing and speaking as if together

“MY story is about connecting people globally,” Ahmed, 48, said in his office at the London Independent Hospital. An associate dean of Barts and the London School of Medicine and Dentistry, the Bangladesh-born surgeon performed the world’s first virtual-reality (VR) operation recorded and streamed live in 360-degree, or immersive, video in 2016. It was viewed live by 55,000 people in 142 countries and downloaded 200,000 times on YouTube, he said. Ahmed cofounded Medical Realities Ltd., which began last April offering a free VR interactive learning module for surgical trainees. While VR isn’t new in health care, its affordability is: Medical headsets

That’s helping to stoke a market for VR hardware and software that’s poised to expand 54 percent annually over the next five years, reaching almost $27 billion by 2022, Sarasota, Florida-based Zion Market Research said in a report last October. The global digital health market, which includes everything from fitness apps and wearable devices to consultations over the Internet, will reach $537 billion by 2025, from $196 billion in 2017, Transparency Market Research said last September. Philips Healthcare, McKesson Corp., Allscripts Healthcare Solutions Inc., Cerner Corp. and Agfa-Gevaert N.V. are among companies benefiting from the growth, the Albany, New Yorkbased firm said. Continuous innovations are needed to meet the changing demands and future challenges of medicine, said Luke Slawomirski, a health economist and policy analyst with the Organisation for Economic Cooperation and Development in Paris.

‘Hero physician’

“The skills and attributes needed by health-care providers will be very different in the future,” said Slawomirski, who trained as a doctor. “Soft skills like communication, teamwork and adaptability to complex

environments will be essential. The days of the hero physician are over: Health care is now all about teamwork, relationships and trust.” Watching operations online won’t provide essential surgical training, and nothing can replace the experience of interacting with real patients, said John Quinn, a vascular surgeon in Brisbane, Australia, and the executive director of surgical affairs with the Royal Australasian College of Surgeons. “Just watching a picture of something being done doesn’t teach you terribly much,” said Quinn, who completed his surgical training in the early-1980s. “You have got to be able to touch and feel and do all sorts of other things.”

Privacy concern

The Australasian College isn’t in favor of live-streaming surgeries because of privacy concerns and the potential to distract and pressure the surgeon, he said. “It’s treating surgery more as entertainment,” Quinn said. “It’s almost voyeuristic and putting people’s privacy greatly at risk, while they are showing things around the world to all sorts of people.” Ahmed says that, beside the training function of his online operations, engaging with and educating the public helps to demystify surgery and make it more transparent. “We have to challenge dogma and tradition in health,” said Ahmed, who won a national training award in 2015 and is on the council of the Royal College of Surgeons of England. “Unless you challenge, you will settle with mediocrity, stuck in the Dark Ages.”

A10 Tuesday, January 23, 2018 • Editor: Angel R. Calso

Opinion BusinessMirror

www.businessmirror.com.ph

editorial

Credible Charter change

e tend to agree that the best option for amending the 1987 Constitution—if we are to go through with it at all—is through a constitutional convention or by electing delegates to a convention that would propose amendments to the Constitution.

The leadership of the House of Representatives espouses the constituent assembly (Con-ass) mode that would pave the way for the adoption of a federal form of government, with the membership of said assembly coming from the Senate and the House. Indeed, Speaker Pantaleon D. Alvarez has even argued that the House can convene itself into a Con-ass all on its own without the presence of senators. Whether this is constitutional or not is another matter. However, the real question with the constituent assembly mode of changing the Charter—whether the assembly is composed of senators and House representatives or just the latter—is this: Can the people trust the politicians in Congress not to mess up such an important political deliberation? Trust is the key issue here. In the December 2017 nationwide survey on the performance and trust ratings of the top government officials and key government institutions conducted by Pulse Asia Research Inc., the Senate enjoyed majority approval and trust ratings of 55 percent and 56 percent, respectively. Appreciation for the performance of the lower house was lower, with approval and trust ratings of 50 percent and 49 percent, respectively. These numbers are not bad per se, but they also do not speak of an overwhelming vote of confidence. So again the question: Can we leave the changing of the Constitution up to Congress? The majority of politicians in Congress, both past and present, have shown an instinctive ability to put their own self-serving interests before the country. The Con-ass mode may, indeed, be the cheaper and faster way of changing the Constitution, but cheaper and faster do not necessarily mean the best way; for in such a mode lies the danger of having like-minded, self-serving members of Congress engage in deliberations only with one another and for one another. One of the most striking findings in social psychology is that when like-minded people speak and deliberate among themselves, they tend to go to a more extreme point in line with their original tendencies. So if people of one ideological stripe like politicians who share the same interests and commitments congregate to change the Constitution, they might well end up taking an extreme position. Who knows if it will stop at federalism? Sen. Franklin M. Drilon has already warned about an agenda that includes the suspension of elections, extension of the terms of members of both Houses of Congress and the removal of a check and balance system by abolishing the Senate. The House has already shown its propensity to railroad certain measures favored by the majority of its members. It comes as no surprise at all that its leadership is willing to push for a Con-ass comprised only of congressmen. This already shows the danger with any attempt by like-minded individuals to make amendments to the Constitution—the inherent danger of amendments taking a life of their own, resulting in the total overhaul of the Constitution, perhaps beyond what is necessary or what was initially intended. You might say this position shows an extreme lack of faith in our political process, specifically in our politicians in Congress. We agree. But can you blame us or the Filipino people for being a little suspicious of their legislators after having seen the extent of past corruption scandals in Congress? On trust issues alone, it is best for our country and our people that constitutional amendments be proposed through a Constitutional convention, where the people can elect delegates who will represent their interests in the new charter. This option is not only the proverbial lesser evil. We believe it is also the most legitimate and credible mode of Charter change, because in a democracy the ultimate decision-making power of government should be vested in the people and not in just a small class of them. Congress, convened as a constituent assembly, is too small, select and confined a class to represent the genuine interests of an entire nation.

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Manny B. Villar

THE Entrepreneur Continued from A1

dvances in information and communications technology are also creating a similar impact on our lives. For instance, many people would feel helpless without a cell phone in their pockets. Very few will have the patience to write by pounding on a manual typewriter, instead of a touch-screen tablet, or at least a laptop. When it comes to financial transactions, including payment of utility bills, sending money to families from different countries, purchasing goods and withdrawing funds, the Philippines is not so far behind developed countries in shifting to paperless transactions. Banks discourage their clients from using passbooks, promoting the more efficient ATM (automated teller machine) cards, which allow people to deposit or withdraw money almost anywhere, without going to the banks where they opened their accounts, and lining up before a tired teller. Inventions, innovations and technological advances are part of what we call progress. They are good and welcome because, as I said earlier, they generally make life easy.

However, we all recognize that new products and processes can also create problems that did not exist before. Money is the one thing that is ever present in our daily routine, so I will focus on the negative impact of advances in information and communications technology on financial transactions. Paperless or online transactions —between banks, corporations or people—have created a new type of crime, now known as cyber crime. Theft is no longer limited to breaking into private homes or bank vaults; the modern criminals are able to steal millions of dollars just by hacking online accounts, both individual and corporate. In the Philippines it is now common to read or watch news about depositors who complain of

losing money from their accounts. Of course, the biggest in terms of amount was the loss of $81 million in February 2017 from the account of the government of Bangladesh with the Federal Reserve Bank of New York. Investigation showed that the money was transferred to the Philippines and then moved to another country. This is, of course, a global problem. In an online report in July 2014, US News cited a study by the Center for Strategic and International Studies, which found that hackers were costing consumers and companies between $375 billion and $575 billion a year, and that the figure was expected to rise as online information stealing expands with increased Internet use. The study, funded by cybersecurity firm McAfee, also estimated that losses from online crime was equivalent to 0.8 percent of worldwide GDP, with developed countries like those in North America and Europe losing more than countries in Latin America or Africa. In the Philippines it is understandable that many people were worried by the recent attacks on several local banks, considering that most banking transactions are now done online. On the positive side, the banks that were affected are all very stable, and I’m sure that those banks have taken the necessary precautions to protect them and their clients from hackers.

The PSE: A congressman weighs in John Mangun

Lorenzo M. Lomibao Jr., Gerard S. Ramos Lyn B. Resurreccion, Efleda P. Campos Dennis D. Estopace

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Fighting cyber criminals

OUTSIDE THE BOX

lected officials should rarely—if ever—make any comments about the financial and stock markets and then only under certain conditions.

One condition that is difficult to fulfill is that the person actually has some knowledge about what he is talking about. Another is that the person in question has done something that might have positively influenced those markets. Legislative actions and implementation by government departments can have a major effect, as we will soon witness with the new tax law. The previous administration was extremely fond of taking credit as the Philippine Stock Exchange (PSE) was making record highs in 2014. When the market fell back in 2015, suddenly Malacañang went deathly silent about stock prices. The Duterte administration started the same way

but has since been quiet as it should be. If in six months stock prices are still rising—and inflation stays below 4 percent—only then will an “I told you so” be acceptable. The late former Sen. Ernesto Maceda was one who qualified on both accounts. In my many conversations with him, I can assure you the senator was as knowledgeable about the stock market as any experienced investor or active trader. That is not true of all legislators. Republic Act 8799, or the Securities Regulation Code, has sections that were conceived, at best, by someone who read Wikipedia and, at worst, by someone who knew someone who had read Wikipedia.

A statement released on January 21, by the Deputy Minority Leader Rep. Luis Jose Angel N. Campos Jr. began with “Stock market boom to help drive jobs creation.” I cannot attest to Campos’s expertise about the local stock market, but some of the analysis is sensible, which was a pleasant surprise. From the news release: “The country’s booming stock market is expected to help drive jobs growth in the months ahead, primarily by enabling publicly traded companies to raise additional capital for business expansion.” That sounds good on paper but is not necessarily true in real life. The statement says that the government will gain additional revenue through the increase in the Stock Transaction Tax and as the PSE generates a steady revenue stream from stock trading. I do not have a problem with that tax increase. If a one-tenth of 1-percent increase in the transaction tax is going to kill the stock market as some have said, then we should have put our funds into Lotto tickets, instead of the market these past years. Now, about that job creation, here is where things get a little sticky. This applies both to initial public

As the primary banking regulator, the Bangko Sentral ng Pilipinas (BSP) is also moving swiftly to address cyber threats. In November last year, the Monetary Board, the BSP’s policy-making body, approved stricter rules on information security management focusing on cyber security. The BSP says the new guidelines are needed to address the growing concerns on the fast-evolving cyberthreats that continue to confront global, as well as domestic financial communities. The new guidelines require BSP-supervised financial institutions to set up a 24/7 security operations center equipped with advanced technologies and manned by competent analysts to proactively monitor emerging and highly sophisticated cyber threats and attacks. Reforms initiated by the BSP have helped the domestic banking industry weather global crisis in the recent past, and developed the industry’s resilience toward future challenges. Overall, I believe the local banks stand on solid ground. Having said that, the new threats require that the monetary authorities and the banks, as well as the public, be vigilant and always prepared to deter any attacks from cyber criminals. For comments, e-mail mbv.secretariat@gmail. com or visit www.mannyvillar.com.ph.

offerings (IPO) and to companies raising additional capital. A company that raises cash to pay down debt is a red flag for me. If a company needs new money to pay off debt, that tells me maybe they took on too much debt in the first place. That is bad management and new funds are to cover a mistake. If they are paying off the debt entirely, that may be worse. Borrowed money should be used to make more money and then that profit is used to pay the debt. So why do you need more money? If new funds are actually going to be used for specific new profitmaking ventures or expansion, then the IPO or follow-on offering should be a winner. But you must read the prospectus to find out. Finally, “Campos also sees the roaring stock market boosting consumer confidence and spending.” How I wish I could count on that. Nonetheless, stock prices going up are definitely better than prices going down. E-mail me at mangun@gmail.com. Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stockmarket information and technical analysis tools provided by the COL Financial Group Inc.

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Will this investment program fly?

The Marcos legacy Cecilio T. Arillo

database

Ernesto M. Hilario

ABOUT TOWN

If Bitcoin is the rage these days as it promises big returns even on small investments and much-bigger returns on big ones, we can understand the huge interest in this latest money-making scheme. We received this article our inbox late last week. It didn’t clearly indicate whether it was written by Izumi Tadashi, touted as Japan’s “cryptocurrency evangelist,” but we think it might prove interesting to prospective Bitcoin investors.

N investment program being launched next year for Japanese investors via an initial coin offering or ICO promises a windfall for the Philippines in real-estate, tourism, renewable energy and organic-farming development. The NOAH Ark Coin (NOAHCOIN) will be introduced in Japan by midyear as an ICO, and will be used both as a funding source and eventual digital currency for a number of projects being developed in the Philippines: A mixed-use resort development in Mindanao that will include, among other features, an assisted-living facility; residential realestate in Metro Manila; an organic agriculture program for farmers in Mindanao; and renewable-energy projects in various locations around the country. Although the primary focus of the ICO is as an investment opportunity for exclusively Japanese investors, the NOAH Coin infrastructure will provide, as a coincidental benefit, a secure, fast and virtually cost-free remittance facility for Japan-based overseas Filipino workers (OFWs), through Noah’s partnerships with the well-known Nippon Pay in Japan and Philippine-based blockchain technology provider SCI, in conjunction with tech developers Ark Systems Technology. Private investment from Japan has declined sharply since the beginning of the Duterte administration, mirroring the drop in commercial investment, but for different reasons. Whereas at least some of the cooling in business investment is attributed to policy uncertainty, the drop in private investment is due mainly to frustration with the financial environment for ordinary Japanese citizens. Lacking safe and profitable opportunities to invest, many Japanese simply hold cash at home, so that much of Japan’s investment potential is untapped. Although naturally cautious, Japanese investors are eager to explore investment opportunities and tend to take a long-term view of potential returns. The Philippines is highly regarded as perhaps Asia’s last greenfield by most Japanese: It is perceived as a country having a strong economy but underdeveloped in comparison to other high-return markets like Hong Kong and Singapore, and thus promises solid returns over the long term. Thus, any welldesigned investment opportunity in the Philippines is enthusiastically received in Japan. Because similar investment programs have been met with high demand, Noah developed the NOAH Coin plan to tap this financial potential, benefiting the Philippines in an entirely risk-free way, as the ICO will only be offered to Japanese investors. This, is in part, because of the tremendous opportunity the Japanese market offers, but also because compared to the Philippines and even countries like the US, Japan is comparatively better developed in terms of regulatory and financial sector management of the fast-growing cryptocurrency environment. Cryptocurrency in any form, despite its enormous potential, is an admittedly risky business, subject to a great deal of investor skepticism, unfortunately much of it deserved due to past cases of poorly designed or managed ICOs, and in a few instances, regrettable cases of outright fraud. To ensure NOAH COIN’s success with cautious Japanese investors and ever-

Although naturally cautious, Japanese investors are eager to explore investment opportunities, and tend to take a long-term view of potential returns. The Philippines is highly regarded as perhaps Asia’s last greenfield by most Japanese: it is perceived as a country having a strong economy but underdeveloped in comparison to other high-return markets like Hong Kong and Singapore, and thus promises solid returns over the long term. Thus, any welldesigned investment opportunity in the Philippines is enthusiastically received in Japan. tightening regulatory scrutiny of the industry, NOAH COIN’s creators have diligently sought to build security and credibility into their ICO before it is even introduced, beginning with the selection of one or more of the best-performing and most secure exchanges, which impose strict technical and financial requirements on prospective new coins. Unlike many other ICOs, whose returns are dependent on the coins’ trade value as exchange market securities, NOAH COIN is classified as a token coin, one whose primary purpose is something more substantial than a simple trade instrument; for example, among the other benefits it will provide to investors, NOAH COIN can be used to claim special incentives, products and services within Noah’s developments here. Like other cryptocurrencies, NOAH COIN will eventually be available to traders from the Philippines and other countries in limited quantities through the cryptocurrency market, but the ICO will only be offered in Japan. Apart from a demanding list of technical requirements new coins must satisfy before being accepted for listing on a reputable exchange, the exchange also requires that the ICO-issuing companies be government-licensed; NOAH COIN is backed on that account by Nippon Pay’s license from the Bank of Japan, and once it is approved, a license as a remittance facility here in the Philippines. This is mainly necessary to provide a properly regulated technical platform to allow the smooth transfer of invested funds from Japan to the Philippines, and is primarily intended for use between Japanese investors at home and Japanese businesses here; its availability as a remittance channel for OFWs in Japan is largely coincidental, but a happy added benefit to the main program. Development of the necessary technical infrastructure for NOAH COIN, which includes the creation of secure digital wallets, the actual creation of the digital coins—which are the result of complex mathematical operations—and integration of the NOAH COIN distributed ledger, otherwise known as the blockchain, with the Ethereum cryptocurrency platform, is ongoing while the final necessary government licenses and regulatory clearances are being secured. If all goes according to plan, the ICO will be launched by midyear.

E-mail: ernhil@yahoo.com.

HE Marcos Legacy, a long-awaited book authored by this writer and published this week by Brown Madonna Press and Amazon’s CreateSpace for local and international editions, respectively, presents a glittering galaxy of multidimensional episodes wittingly ignored and distorted for more than three decades now.

In 446 pages, “the book exudes a classic and panoramic vista of events that metamorphosed to the chronicled history of the country. It rights the wrongs and omissions wittingly or unwittingly omitted and rectified,” said retired Justice Manuel ‘Lolong’ M. Lazaro Jr., who wrote the introduction of the tragic life of the late President Ferdinand E. Marcos. “His perceived illegal acts have been incessantly repeated to veil a veneer of truth to submerge or marginalize his landmark contributions, particularly in the political and legal system. But, as the surrealist painter Salvador Dali once said: ‘The difference between false memories and true ones is the same as for jewels: It is always the false ones that look the most real, the most brilliant,’” Lazaro said. To drive home his point, he also quoted the great playwright William Shakespeare who wrote in an epigrammatic tone: “The evil that men do lives after them; the good is oft interred with their bones.” Lazaro added: “It is typical of some people to have short memories of another’s good deeds, but long memories of the other’s bad or perceived wrongs.”

FM’s place in Philippine history is secured

unremarkable in constitutionalism, have fashioned and sustained a litany and barrage of adverse publicity to efface President Marcos from the tapestry of history.” Marcos’s achievements and contributions are a matter of record. To obliterate his achievements/contributions from the pages of history is to distort the past and mislead the future. “Succeeding administrations have inordinately used laws and the media to destroy or consign Marcos to oblivion, notwithstanding his solid unprecedented achievements for the good of the nation and its people,” argued Lazaro, chairman emeritus of the Philippine Constitutional Association. He explained that good deeds, especially those beneficial to the nation and the people, cannot be effaced or expunged. “Good survives and triumphs in the end. FM’s place in history is secure. The Marcos laws abound around and benefit us. They are embedded in our legal system and they continue to govern and guide the nation. Marcos’s vision and foresight in lawmaking for governance are richly illustrated by the varied and numerous legal issuances.”

Number of FM legal issuances

According to Lazaro, “The beneficiaries of the February 1986 accidental events of time, place and personalities, remarkable only for being

Between September 21, 1972, and February 25, 1986, President Marcos had crafted and formulated, with the assistance of experts, 7,883 presidential decrees (PD)

Tuesday, January 23, 2018 A11

Marcos’s achievements and contributions are a matter of record. To obliterate his achievements/ contributions from the pages of history is to distort the past and mislead the future. “Succeeding administrations have inordinately used laws and the media to destroy or consign Marcos to oblivion, notwithstanding his solid unprecedented achievements for the good of the nation and its people,” argued Lazaro, chairman emeritus of the Philippine Constitutional Association. He explained that good deeds, especially those beneficial to the nation and the people, cannot be effaced or expunged. and other legal issuances that have the force and effect of law covering almost every phase of human life or conduct—from birth to the grave, so to speak. They are categorized as follows: a) Presidential Decrees (1 to 2036). b) Letters of Instruction (1 to 1525). c) Letters of Implementation (1 to 157). d) General Orders (1 to 61). e) Executive Orders (366 to 1093). f) Administrative Orders (349 to 504). g) Proclamations (1081 to 2486). h) Memo Circulars (599 to 1297). Significantly, out of the 2,036 presidential decrees issued, only 67 PDs have either been repealed or modified. The minimal percentage of 67 PDs either repealed or modified by Executive Order 187 of former President Corazon C. Aquino were the decrees increasing the penalties for certain offenses against public order and security, e.g., PDs 38, 1735, 1834, 1974 and 1996. These legal issuances were designed not only for the past, but also for the present and the future. Gifted with legal acumen, Marcos

adorned his legal issuances with wisdom and justice, and embellished them with compassion for the welfare of the nation and its people. They are exclusive of the hundreds of laws that he authored and/or sponsored as congressman and senator for almost two decades.

A leader of phenomenal vision

President Marcos was a leader of phenomenal global vision. He dreamed of greatness and relentlessly pursued its realization and fulfillment. He was a leader ahead of his time. Perhaps, it is for this reason he was often misunderstood and unappreciated. But in time, after the winds of hatred and vengeance shall have flown away, he will be remembered as the greatest Filipino lawgiver. Through its 17 chapters, the book draws its intense analytical narration and exposition of events from the works of many historians, scholars, writers and important people, including politicians, economists, sociologists and national security experts, who pieced together a comprehensive and insightful account of the destabilization and ouster of the Marcos regime.

Is Marcos a heel or a hero?

IT depends. It is a matter of perspective. He is a hero to those who are aware and appreciative of his remarkable performance and achievements. However, he is a heel to those who envy his ingenuity, vision and foresight and to those who seek revenge and hatred. “At time’s healing hands, FM will be vindicated. He is a great man unjustly judged at the wrong time by the wrong minds. Time and history will vindicate his vision and foresight, especially in lawmaking. Generations freed from the ugly blemishes of hate, vengeance and prejudice will look more kindly and with gratitude on his achievements and contributions to the nation,” Lazaro said. To reach the writer, e-mail cecilio.arillo@ gmail.com.

The Democrats are right—and should settle David Leonhardt

new york times

he government shutdown is overwhelmingly the fault of Republican leaders. They, not Democrats, are the ones trying to make sharp changes in federal policy, like reduced legal immigration and a border wall. Democrats are largely trying to preserve programs—children’s health insurance and Dreamer protections—that many Republicans say they, too, support. The Republican Party, of course, is also the one led by a president who doesn’t know enough about policy to negotiate on his own behalf. Everyone was able to see that two weeks ago during a televised White House meeting, when other Republicans had to correct President Donald J. Trump—gently and awkwardly— about what he was supposed to believe. Trump, as The Washington Post reported this weekend, is “clearly not understanding the policy nuances of the negotiation.” And yet, to say that Republicans are responsible for the shutdown is not the same as saying that they would suffer most from a protracted shutdown. I worry that some progressives are missing that distinction. The shutdown has created one of the more treacherous political moments of Trump’s presidency for Democrats. It’s one they can navigate, but it requires subtlety. So far during Trump’s time in office, principled policy and savvy politics have generally aligned for Democrats. They stymied Republican attempts to take health insurance from millions of people. Democrats tried to block a huge, permanent tax cut for the wealthy that

came with small, disappearing tax cuts for everyone else. Democrats have opposed Trump’s efforts to let big corporations operate without much oversight. In each case, it has been both good policy and good politics. The shutdown is different, and more complicated. It’s more complicated because it has turned into a mini-culture war, over immigration. A culture war over immigration replays the racialized debate that dominated the 2016 presidential campaign. As much as it saddens me to say it, the evidence is pretty clear that a racialized debate helps Trump. It’s the kind of debate that will make it harder for Democrats to retake the Senate and House this year. Multiple studies have found that the political views of white Americans drift to the right when they are reminded that the country’s population is slowly becoming less white. And many of these voters are winnable for Democrats. A good number, remember, voted for Barack Obama. They may have some racist views—many people do— but they’re neither deplorable nor irredeemable human beings. Steve

The smart move now for Democrats is to accept a short-term funding bill that ends the shutdown and diffuses the tension. Republican leaders are open to that solution, because they have their own vulnerabilities. Their party is the majority party, which is often blamed for dysfunction. That solution feels a bit unsatisfying, I know. But tactical retreats can lead to big victories in the future.

Bannon, the guru of white nationalism, understood this dynamic, once saying, “The Democrats, the longer they talk about identity politics, I got ’em.” Similarly, some innovative polling by YouGov has found that a large portion of white Americans see “prohibiting discrimination against women and minorities” as one of the Democratic Party’s top priorities. Unfortunately, few white Americans who aren’t already loyal Democrats say the same issue is one of their own priorities. They’re more worried about their own struggles, many of which are economic. “It’s a political liability for Democrats,” Doug Rivers, YouGov chief scientist told me, “in the same way being the party of the rich is a problem for Republicans.” I know that many progressives are sick of hearing about white voters, but it’s extremely hard to succeed in American politics without winning a good portion of them. About 69 percent of eligible vot-

ers are non-Hispanic whites. They have outsize power, too, thanks to a combination of their turnout rates, their geographic dispersion, gerrymandering and the Senate’s small-state bonus. Briahna Joy Gray wrote a mustread essay on this topic for New York magazine, titled “Racism May Have Gotten Us Into This Mess, but Identity Politics Can’t Get Us Out.” Or as Matthew Yglesias wrote in Vox last week, “If you want to help the people most severely victimized by Trumpism, you need to beat Trumpism at the polls.” The best debate for Democrats is one that keeps reminding white working class voters that they’re working class. It’s a debate about Medicare, Medicaid, taxes or Wall Street. The worst debate is one that keeps reminding those voters that they’re white. To put it another way, if you’re a Democrat who’s frustrated that Republicans have managed to turn the shutdown into a fight over immigration, ask yourself: Why would they do that? Democratic leaders are certainly right to insist on protection for the Dreamers. The question is whether the best way to protect them—and the best way to elect politicians who will help them in the long term—involves keeping immigration policy in the political spotlight for weeks on end. The smart move now for Democrats is to accept a short-term funding bill that ends the shutdown and diffuses the tension. Republican leaders are open to that solution, because they have their own vulnerabilities. Their party is the majority party, which is often blamed for dysfunction. That solution feels a bit unsatisfying, I know. But tactical retreats can lead to big victories in the future.

2nd Front Page BusinessMirror

A12 Tuesday, January 23, 2018

Visitors to Manila’s walled city reached 1.68M in 2017 99.5% T By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

HE Intramuros Administration (IA) exceeded its visitors target for 2017 by some 57 percent, attracting some 1.68 million to its museum and parks.

The percentage of visitors surveyed that rated the quality of Intramuros facilities as “satisfactory or better”

Lawyer Guiller B. Asido, IA administrator, attributed the rise in visitors to “more tours conducted and coordinated,” while “events organized and social-media accounts reached increased by 63 percent in 2017 compared to 2016.”

year was 962,041. Asido told the BusinessMirror, however, “it’s difficult to compare the 2016 to 2017 since the DBM [Department of Budget and Management] used different targets and MFOs [major final

The visitors target for 2017, per the General Appropriations Act for 2017, was 954,000. The number of visitors in 2017, however, was 9.7 percent lower than the 1.86 million who visited in 2016. The visitors target in that

outputs] for 2016. So for 2017, we just look at our performance based on targets.” About 99.5 percent of visitors surveyed rated the quality of facilities as “satisfactory or better,” exceeding the 90-percent target for 2017, and the 96 percent recorded in 2016. Earlier, Asido said Chinese tourists were the largest source of visitors of Intramuros. (See “Intramuros is top draw for Chinese tourists—I.A.” in the BusinessMirror, November 13, 2017.) The agency failed to reach its P81-million target for revenue generated from leasing and rental of facilities, hitting only P75 million last year. The IA administrator ex-

Asia and the Pacific (FMIC-UA&P) Capital Market Research estimated inflation to be closer to 4 percent in 2018. The local think tank said higher headline inflation is expected due to the TRAIN, particularly its effect on petroleum prices and products being levied the so-called sin taxes. Higher prices are also expected because of new taxes, such as what is imposed on sugar-based beverages, and less exemptions on the valueadded tax (VAT). The think tank expects inflation to average 3.7 percent this month 3.9 percent in February and 3.9 percent in March. “We think that price mark-ups will continue to move at a quicker pace in the coming months brought about by the imposition of excise tax on some commodities [fuel, automobiles, sugar and beverages, among others]. Nonetheless, we believe that inflation will still be within the BSP’s [Bangko Sentral ng Pilipinas] target, albeit, at the higher end,” the think tank explained. In 2017 inflation averaged 3.2 percent. The highest level of inflation was recorded last October at 3.5 percent, while the lowest was last January at 2.7 percent. Earlier, FMIC&UA&P Capital Market Research data showed that every peso increase in the expenses of workers due to price hikes caused by TRAIN would be offset by the P2.40 that they would save from their personal-income tax (PIT) exemption on the average. UA&P economist Victor Abola said the additional amount needed

by consumers is about P57 billion, while the PIT will return P137 billion to households, increasing their purchasing power. However, Abola added that, since this computation is only an average, some households may spend more for certain commodities and see lower gains from the reduction in PIT. The subsidies, Abola said, are needed to shield the lowest 40 percent of households from the higher VAT on fuel and the removal of a number of personal-tax exemptions. For jeepney drivers, he added, there will be subsidies extended to help them cope with the higher cost of petroleum products. This will prevent jeepney drivers from raising fares that could also increase the prices of other goods and services. For this year, DOLE Financial and Management Services Director Warren Miclat said they have a P2.3-billion budget for their Tupad and Government Internship Program. He added Congress has earmarked another P500 million for Tupad in case they will need additional funding to accommodate TRAIN-affected workers in the next three years. “During the TRAIN bill deliberation, we were asked by the [congressional] committee, and we recommended this amount, which they gave,” Miclat said. The DOLE said it is now monitoring workers affected by TRAIN so the agency could determine other appropriate programs it could extend to them. Last week Labor Secretary Silvestre H. Bello III endorsed the P500 cashvoucher subsidy being proposed by labor groups for minimum-wage

Welfare and Development (DSWD) for 2018 to serve as a mitigating measure for the impact of TRAIN to households. The DSWD will use the amount for its unconditional cash-transfer program to help 10 million Filipino households to cope with the effects of TRAIN. The DBM projected that TRAIN,

which took effect this month, will continue to boost inflation up to next year. The Associated Labor Unions-Trade Union Congress of the Philippines earlier said over 15.6 million workers in the informal sector will be vulnerable to price increases caused by TRAIN and will need aid from the government.

With Samuel Medenilla

Elijah Felice E. Rosales

plained that the P81-million target was “premised on the increase in rental fees and lease rates, which did not happen, since the new rates were only approved in December 2017.” On the upside, the actual collections exceeded the 2016 revenue by P600,000. Under the GAA for 2018, the IA is targeting to increase its number of visitors to some 1.92 million and revenue collected to some P62 million. Asido, likewise, said there was a 16.5-percent rise in the number of permits/clearances issued in 2017 to 1,670. He explained that this was largely due to the “increase in monitoring and stricter enforcement See “Visitors,” A2

DARK DAY IN LEGAZPI Residents, wearing masks, go about their daily business as Mayon Volcano’s eruption plunges some townships in darkness on Monday in Legazpi City. The Philippines’s most active volcano erupted on Monday, prompting the Philippine Institute of Volcanology and Seismology to raise the Alert Level to 4 from last week’s Alert Level 3. AP earners to help them cope with the effects of TRAIN. But he said the proposal must be approved by the Department of Budget and Management (DBM) before it could be implemented. Aside from livelihood aid, the DBM said the government also allocated |P24.5 billion to the Department of Social

EU-PHL ties get boost with Senate OK of PCA he Philippines and the European Union (EU), in spite of differences in appreciation of human rights, were off to a good start this year in terms of improving trade relations. EU Ambassador Franz Jessen said the EU delegation in the country welcomes the third approval of the EU-Philippines Partnership and Cooperation Agreement (PCA) on Monday. He labeled the Senate concurrence of the bilateral pact as “a major milestone and a big step forward in the EU-Philippines relationship.” The PCA will serve as the general framework that is intended to improve the bilateral relations between the country and the regional bloc. It is aimed toward the development of cooperation in crucial political, economic and development issues. Jessen said the challenge now lies in the implementation of the framework and how it will effectively serve the interests of the two parties. The EU is the third-largest export partner of the country last year, which is largely due to the trade privilege granted by the regional bloc to Manila’s products. “From the EU side, we will do everything to keep the relationship with the Philippines robust, dynamic and positive,” Jessen said in a statement. Aside from trade, foreign direct investments (FDI) from EU memberstates make up the largest chunk of FDI in the country, generating more than 500,000 jobs. In her sponsorship speech, Sen. Loren B. Legarda said the EU is an important partner of the country in its shot at continuously improving its economy. The PCA, she added, “will serve as a solid platform for dialogue to explore ways to achieve our shared goal of a stronger partnership based on mutual respect, trust and equality.” “The EU also continues to prove to be a committed development partner. As of June 2017, the EU ranks fourth among sources of grants from official development assistance [ODA] and eighth among the combined sources of loans and grants of ODA. The EU’s total ongoing ODA portfolio to the Philippines amounts to €190.48 million,” Legarda said. She also took note of the EU’s relentless support for developing Mindanao under the Mindanao Trust Fund, which is a multidonor grant facility that consolidates international development assistance for the recovery of conflict-affected communities in the southern island. She also noted that the EU is a committed member of the International Monitoring Team in the country’s pursuit to make peace with Moro groups.

TRAIN-induced price hikes to peter out–Pernia Continued from A1

www.businessmirror.com.ph

Integrity pacts and open contracting: The EU perspective Continued from A1

Why is the European Commission supporting the use of IP to EU-funded projects? Preventing and fighting corrupt practices in projects funded by the EU has always been a priority for the commission, as well as ensuring efficiency and effectiveness in public contracting. It’s a way to save taxpayers’ money and make sure projects run smoothly because the goal is to guarantee all spending on public contracting is free from corruption. This is why the commission’s Directorate General for Regional and Urban Policy and Transparency International joined forces in March 2015 and launched the pilot project “Integrity Pacts—Civil Control Mechanism for Safeguarding EU

Funds” to explore and promote the use of IP for safeguarding EU funds. T he commission’s ex pectation is that the IP approach will show that ordinary citizens and their champions—civil-society organizations—can play an important role in monitoring both the allocation of funds for projects and the way that money is spent. Clearly, if the contracting author it y has planned the tenders well, an integr it y pact can also bring costs savings because of improved competition. The project is now at an advanced enough stage that the value of civil-society monitoring through an IP is becoming clearly evident. Fear that the pact w i l l repl ic ate e x ist ing over sight without adding anything

useful is diminishing. Beyond fulfilling a watchdog function, it was encouraging to hear how IP have already brought concrete, additional advantages to the public procurement processes they are monitoring. The commission has adopted and is implementing an Action Plan on Public Procurement. The goal is to identify good practices and promote them among member-states, as well as to help them use public tendering in a more strategic way. The commission’s objective is to make sure that public procurement helps in achieving objectives like environment protection and social inclusion, and improves the digital economy and society. The role of civil society, as an

effective anticorruption actor, is important. It contributes to holding government to account. Transparency International’s long experience in combating corruption has shown the crucial contribution of transparency, accountability and greater efficiency, especially in the particularly sensitive area of public procurement. Within the next five years, most likely, we will see a totally different public procurement landscape— e verything will be electronic and much more data shou ld b e op e n ly av a i l a ble. Trends, such as open contracting, are offering new opportunities to scrutinize public spending. But public procurement is a very complex matter and not necessarily understood by average citizens. Open data gives us a lot

of opportunities, but if you don’t understand it, it is of no use. Civ il-societ y organizations have the necessary skills to translate data and make the process more understandable to citizens while ensuring monitoring and civic control. Beyond this, civ il- societ y involvement is one of the best ways toward greater public engagement and understanding of public policies and, in particular, public procurement. Can IP be introduced in the Philippines? Of course! The Integrity Initiative is presently introducing “Open Contracting” as a test in Muntinlupa City; Mayor Fresnedi is our partner. The test project involves an “Integrity Circle,” composed of

business and civil society. Everybody understands that IP promote transparency and cost efficiency, as well as good governance. They also have the potential to reduce costs and increase competition, which, of course, is vital for business. IP can encourage institutional changes, such as the increased use of e-procurement systems, simplified administrative procedures, improvements of regulatory environment. Tr u st i ng t h at t he test i n Muntinlupa will be successful, Integrity Pacts /Open Contracting will be cascaded to other local government units in the Philippines. Comments are welcome; contact Schumacher@integrityinitiative. com.