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Thursday, January 26, 2017 Vol. 12 No. 106

D.T.I. says U.S. exit from trade deal levels Asean playing field

TPP ‘demise’ gives PHL breathing room

By Catherine N. Pillas

@c_pillas29

he decision of the United States to withdraw from the Trans-Pacific Partnership (TPP) is a boon for Philippine exporters, according to a senior official of the Department of Trade and Industry (DTI).

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30 percent The proportion of PHL products that would have difficulty competing in the US market should TPP push through In one fell swoop, Trade Undersecretary Ceferino S. Rodolfo said, US President Donald J. Trump removed the advantage to be enjoyed by other Asean countries belonging Continued on A2

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Filipino-Chinese interracial marriage: A cracked mirror? »A6-A7

The rise of the Trumps amid a crumbling social contract

Rene E. Ofreneo

laborem exercens Antonio Gramsci, Italy’s political and cultural thinker, was imprisoned by the fascist dictator Benito Mussolini on the eve of World War II. From his cell, Gramsci wrote metaphorically: “The old world is dying, and a new world is struggling to be born; now is the time for monsters.”

PEACE BUILDERS The Global Peace Convention (GPC) 2017, which will be held in Manila starting February 28, was launched on Wednesday at Marriott Hotel Manila. Gracing the event are (from left) Jose Yulo, president of the Chamber of Commerce of the Philippine Islands, Jinsoo Kim, regional president of Global Peace Foundation (GPF) Asia Pacific; Dr. Primitivo Chua, advisory committee member of GPC 2017; James Flynn, international president of GPF; Arch. Felino Palafox Jr., advisory committee member of GPC 2017; Dr. Nona Ricafort, president of All Nations Women’s Group; Royce Cabunag, program director of SM Cares; and Edgardo Castro, board member of GPF Philippines. Alyssa Salen

Alvarez: Common-station MOA unconstitutional By Jovee Marie N. dela Cruz

@joveemarie

ouse Speaker Pantaleon D. Alvarez on Wednesday said the memorandum of agreement (MOA) signed by the government and private players for the common terminal linking Light Railway Transit (LRT) Line 1 and Metro

Rail Transit (MRT) Lines 1 and 7 is unconstitutional. In a news conference, Alvarez said private companies involved in the project have to secure legislative franchise from Congress first before they could be allowed to operate. “They [concessionaires] don’t have legislative franchise to operate railways. This [railways] is a

PESO exchange rates n US 49.8100

public utility and, under the Constitution, public utility needs a legislative franchise to operate,” Alvarez said. Alvarez added that the MOA on the common MRT-LRT station will undergo close scrutiny in Congress, because it would cost the government an estimated P2.8 billion. See “Common-station,” A2

ALVAREZ: “This is a public utility and, under the Constitution, public utility needs a legislative franchise to operate.”

oday the world has been reeling from one crisis to the other. The most prominent dimension of the crisis is economic. The global financial system nearly collapsed in 2007 and 2008. The failure of the United States and the European Union to stabilize the system and engineer full economic recovery eight years after clearly shows that the dominant economic model of governance based on untrammeled free-trade framework or neoliberal globalization is irretrievably flawed. This is the reason the unemployed and underemployed in the Rust Belt of America gave Donald J. Trump the votes, while their British counterparts, worried about the endless flow of migrants from the Middle East, voted for an exit from the “EU fortress”, In the meantime, the EU

is haunted by other problems: the never-ending Greek debt tragedy; the Italian failure to align their charter with the EU; the doubledigit unemployment in several countries (Spain, Portugal, Cyprus and Croatia); and anxieties over the ISIS terror threats. Enters the billionaire Donald Trump, swaggering but populist. Trump promises to become America’s “greatest job creator” for the “forgotten American man” and “forgotten American woman” by overhauling the way America does business with the world. No more free-trade talks; no more outsourcing of American jobs; no freer entry for cheap Chinese goods and Mexican labor; no free-loading by the Europeans on Atlantic defense budget; and so on. And yet,

n japan 0.4380 n UK 62.2974 n HK 6.4207 n CHINA 7.2625 n singapore 35.0528 n australia 37.7709 n EU 53.4760 n SAUDI arabia 13.2841

Continued on A2

Source: BSP (25 January 2017 )

BMReports BusinessMirror

A2 Thursday, January 26, 2017

TPP ‘demise’ gives PHL breathing room Continued from A1

to the TPP in accessing the American market. “[The pullout of the US] places the Philippines in a very good position. We are now even with other Asean countries that are already in the TPP,” Rodolfo told the BusinessMirror. When the text of the TPP was being concluded in 2015, the Philippines said fellow Asean members belonging to the TPP would gain advantage in exporting to the US. In a research note of IHS Global, chief economist Rajiv Biswas said: “The gains that Vietnam will achieve through the TPP deal will have trade diversion effects on ot her A si a n m a nu fac t u r i ngexporting countries, particularly those which are large exporters of textiles and electronics.” While 70 percent of Philippine

products are already entering the US at a most-favored nation rate of zero-percent duty, local traders are forced to pay tariffs for the remaining 30 percent. “In particular, those with positive duties are garments, auto parts particularly wiring harnesses, wristwatches and seaweed and carrageenan,” Rodolfo said. “Vis-a-vis Vietnam, we would have lost in garments. For Malaysia, we could have been disadvantaged in some auto parts; but now we’re all on equal footing, so that’s very good for the Philippines,” he added. Moreover, Trump’s choice of policy-makers, mostly from the American business community, signals that the US would be open to initiating talks for a bilateral free-trade agreement, the government official noted. “If you look at the policy-makers put in place by Mr. Trump, they look

Common-station. . . “We will ensure that construction of the common station would be beneficial to the riding public and not merely for big business interests involved in the project,” he added. The agreement was signed last week by Transportation Secretary Arthur P. Tugade and Public Works Secretary Mark A. Villar with LRT Authority Administrator Reynaldo Berroya, SM Prime Holdings Inc. Executive Chairman Hans Sy, Light Rail Manila Corp. Vice Chairman Manuel V. Pangilinan, San Miguel Corp. President and COO Ramon S. Ang, and North Triangle Depot Commercial Corp. represented by Ayala Land Inc. Vice Chairman Jaime Augusto Zobel de Ayala. Alvarez said the so-called win-win solution under the MOA would necessarily entail additional cost for the government. He said the original location of the common station fronting SM North Edsa, which was presented by Majority Leader and Lakas Rep. Danilo Suarez of Quezon, was more convenient to the riding public than the current proposal. “Your win-win solution is a win-win solution between SM and TriNoma. How about the riding public and the government? Under the [original] pro-

Continued from A1

posed location presented by [Minority Leader] Danilo Suarez, the government will only spend P780 million minus the P200 million paid by the SM for the naming rights,” the Speaker said. The project ground to a halt when in 2014 SM Prime obtained a temporary restraining order (TRO) from the Supreme Court to stop the publicworks department from transferring the original planned location of the common station in front of SM North Edsa to a location near TriNoma mall. SM Prime sued the previous transportation department for changing the location of the common station even with an existing naming-rights contract with the government. Former transportation officials decided to move the location due to its cost benefits. The common station will be a 13,700-square-meter facility with three key areas. Area A is where the platform and concourse for the LRT 1 and MRT 3 will be located. The cost for the construction of this portion— pegged at around P2.8 billion—will be shouldered by the government. Area B, on the other hand, will connect Area A to Area C, which is where the platform for the MRT 7 will be located.

like ‘deal-makers’—those from the business side, so they may take a pragmatic approach, meaning they could focus on just the common interests, and there could be an opportunity to have a bilateral free-trade agreement,” he said. According to experts, the common pitfalls of expansive, multicountry trade pacts like the TPP meant standards, such as uniform rules in intellectual property or in government procurement, are dictated by bigger players. Implementing harmonized rules entail huge adjustments from less-developed countries that are party to the trade deal. With the TPP out of the way, the route now left for the Philippines to secure permanent, preferential trade and investment access to the US market would be through a bilateral agreement. The DTI has yet to say decisively

if it will initiate bilateral talks with the US, but noted that Philippine businesses are “excited” because the country is now “back in the game” with other Asean countries. Philippine Exporters’ Confederation Inc. President Sergio Ortiz-Luis Jr. agreed with Rodolfo, saying the decision of Washington to pull out of the TPP bodes well for the sector. “The withdrawal of the US is better for the Philippines because this practically removes whatever teeth that the TPP has. Parties to the TPP will no longer be better than us. Now, we’re all in the same footing,” Ortiz-Luis told the BusinessMirror. “Anyway, there are other trade initiatives, such as the Silk Road of China, which does not impose burdensome demands or protocols. All we have to do is actively join it,” he added.

The second area will also boast of an atrium that can accommodate up to 40,000 passengers per day. Based on the contract signed with Light Rail Manila Corp., the common station should be finished by April 2019. Currently, the government is working on bidding out the detailed engineering and design contract for the project. Construction should start by December this year. The Department of Transportation said the design of the common station, which will bear the name of SM, will put into consideration a traffic-management plan that will be approved by the traffic crisis body. In a separate news conference, Minority Leader Suarez said the proposed common station, per the MOA design that puts the common station in between SM North and TriNoma, would cost the government P2.8 billion. This, he noted, costs more than the previously approved designs. “We would like to revisit this new design as we hope to avoid the blunder of the Gateway Mall connection [under the LRT 2], where commuters have to walk approximately 700 meters to transfer from MRT Line 3 to LRT Line 2. This imposes an unjustifiable inconvenience to commuters, and strongly implies no other persuasive reason but corporate greed,” he added.

In 2009 Suarez said the National Economic and Development Authority (Neda) Investment Coordinating Council (ICC) approved the DOTC’s commonstation project proposal originally located in SM City North Edsa Annex. “This would have been an ideal location because all roads converge in the North Edsa. During the last administration, the common station was moved to TriNoma Mall. P1.4 billion was approved in 2013 by the Neda Board, chaired by then-President Benigno S. Aquino III. A TRO was issued but we understand this will be lifted in light of the recently signed MOA,” he said. Alvarez, during the hearing of the House Committee on Transportation, scored Transportation Undersecretaries Bobby Lim and Raoul Creencia for “favoring business interests”. “Let’s not fool ourselves here.... Clearly, they only prioritize the interest of the big businesses and not the public’s,” Alvarez said. For his part, Creencia said the current location of the common station was a product of their technical studies, which prioritize the interest of the riding public. “The choice of where to locate the common station was actually a product of technical consideration... convenience on the part of the passengers and where we were at the time or before we made the decision,” Creencia said.

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The rise of the Trumps amid a crumbling social contract Continued from A1

he wants the universal health-care system erected by President Obama for the poor replaced, while pushing for the lowering of the taxes for the rich corporations and upper middle class. Like Mussolini and other dictators, he keeps repeating his commitment to country, “America First”. Will Trump succeed? Will Brexit succeed? Will the emerging Trumps in Europe and elsewhere gain power, such as Marine Le Pen of the xenophobic National Front of France? The reality is that the world is witnessing the tumultuous end of an economic era, the era of ultraliberal capitalism. This era was ushered in by the policy of market fundamentalism pursued in the 1980s by the trans-Atlantic “soul mates”—President Ronald Reagan of the United States and Prime Minister Margaret Thatcher of the United Kingdom. This market fundamentalism, focused primarily on the dismantling of state-provided public services, metamorphosed in the 1990s as the global “Washington Consensus” doctrine of privatization, economic deregulation and market liberalization. It was in this decade that many countries, including China and Russia, joined the World Trade Organization (WTO) and became ardent economic liberalizers and globalizers. The subsequent expansion of the world economy, reinforced by advances in the information and communications technology revolution and transportation technology, gave the Washington Consensus advocates ample munition to dominate economic policy debates. However, the social and economic downsides of unregulated liberal capitalism keep growing. The 1997-1998 Asian financial crisis revealed how global speculators in the currency, real estate and stock markets, moving in and out of borderless markets, can trigger a financial tsunami that can wipe out businesses and jobs overnight, as what happened in Thailand, South Korea, Indonesia, Malaysia and the Philippines. The crisis was dismissed by the globalizers as a distinctly Southeast Asian phenomenon rooted in the “hazardous” way government functionaries and private corporations do business. They sided with George Soros, the billionaire speculator, in upholding market fundamentalism versus the position taken by the Malaysian Prime Minister Mohamed Mahathir, who defied the IMF by imposing capital controls to save the ringgit. And yet, 10 years after, in 20072008, another financial crisis, bigger and global, exploded. The hardest-hit is the heartland of glob-

al finance—Wall Street. Millions in America and Europe lost jobs. Workers in the US “Main Street” wailed over factory closures and loss of life savings. It was a repeat of the “rag times” during the 19291933 Great Depression. But what was the response of the United States and Europe to the Great Depression eight decades earlier? US President Franklin D. Roosevelt, promising a “new deal” for America, pushed for financial regulations and massive government spending on physical and social infrastructure in order to create jobs for as many people. Classic economic recipe advanced by John Maynard Keynes. However, part of the Roosevelt economic rebuilding program was the recognition of the right of workers not only to form unions freely but also to bargain collectively for fair standards. After World War II, Western Europe expanded Roosevelt’s growth blueprint by developing institutions supportive of welfare states, such as firm guarantees on political liberties and workers’ rights, state delivery of essential public services, unemployment insurance, universal health care, and education and training for all. The foregoing development framework more or less prevailed in the Organisation for Economic Co-operation and Development (OECD) countries from the end of World War II up to the 1970s. Somehow, the system of social welfare and safety nets for all citizens boosted the economy and stabilized society as a whole. As Thomas Kochan of MIT put it, the American economy became stronger because an unwritten or implicit social contract “governed work for many years—the norm that hard work, loyalty and good performance will be rewarded with fair and increasing wages, dignity and security”. The problem is that three to four decades of neo-liberal capitalism have eroded the social contract. Yes, the economy has been growing, but jobs growth is very uneven and exclusionary. Yes, wealth is growing but it is going mainly to what the 99-percent activists call as the “1 percent”. In fact, Oxfam reports that the wealth of the eight wealthiest equal the wealth of the poorest 50 percent of the world, or 3.6 billion people. Moreover, a majority in the developing world have been left behind. In short, the world has become unequal and exclusionary under a fraying social contract, under an unregulated neo-liberal economic order. The question then is: will Donald Trump and other Trumps build a more equitable and inclusive global economic order, or will they exacerbate the inequality and conflicts now dividing the world?

Ceza denies issuing license to Lam’s Clark operations Continued from A12

demanded the concerned locators to explain the circumstances surrounding the presence of CWV holders in Mr. Lam’s casino in Pampanga,” Ponce said. The concerned Ceza locators claimed that most of the arrested CWV holders were no longer connected to them and have been marked as “absent without official leave”. “To date, we are closely working with the proper authorities for the investigation. Any locator that will be found to have violated any Philippine laws and Ceza rules and regulations will be penalized accordingly. The visa of any foreign national found to have been working in Clark Freeport would be revoked and, consequently, the license of any Ceza locator found to have petitioned these illegal expatriates would also be

suspended,” Ponce said. Ponce said a part of Ceza’s standard operating procedure is to regularly and closely work with other government instrumentalities, like the NBI, BI, the Department of Labor and Employment and the Criminal Investigation and Detection Group, in the regular monitoring of operations within its jurisdiction. “Moreover, at the onset of these issues that have somehow involved Ceza, we have also taken the initiative of submitting documents to the proper authorities, including to the Office of (Justice) Secretary Vitaliano N. Aguirre II who is currently heading the investigation, to help fast-track the investigation process,” he said. “Ceza is open to answer any additional questions and/or clarifications that the authorities may have regarding this matter,” Ponce said.

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NDFP hopeful of signing peace agreement with government By Rene Acosta @reneacostaBM

HE National Democratic Front of the Philippines (NDFP) is hoping it could sign the Comprehensive Agreement on Socioeconomic Reforms (Caser) with the government this year, following successful talks in Rome. Upon the marching orders of President Duterte, the government and the NDFP are talking for a possible political settlement that could end years of communist insurgency in the country, which has already killed thousands of people. Randall Echanis, spokesman of the NDFP Reciprocal Working Committee on Socio-Economic Reforms (RWC-SER), said that with the momentum of the negotiations, they expect to finish the draft of the Caser within the year. The RWCs of both panels held four working meetings between January 20 and January 24 in Rome, Italy. During the talks, both panels reached agreement on the preamble and declaration of principles, and common ground found in the bases, scope and applicability and desired outcomes of the SER. Dan Borjal of the NDFP’s media office said both working committees have also begun their discussions on agrarian reform and rural development, also of the SER. During the second round of the talks held last October, both the government and the NDFP have agreed on the SER’s common outline consisting of a preamble and 15 Parts. Borjal said the NDFP conducted a series of sectoral consultations last November and a national consultation last December and exchanged drafts with the government early this month. Echanis said their draft described the country’s economic situation and the revolutionary organization’s proposed reform solutions. “It paints the economic and social suffering of the peasantry and working people in the country. Its premise is Philippine society is semifeudal and semicolonial and, thus, needs genuine agrarian reform, national industrialization, and a free and independent foreign trade and monetary policy for national development,” Echanis said. There are “many provisions” that will need greater discussion and resolution with the government in the course of the negotiations, he said. “These cover the most important measures for redistributing assets and income, asserting independent foreign-economic policy, providing social services and utilities, especially for the country’s poor majority, government support for Filipino farms and enterprises, and ensuring democracy in the economy,” he said. Working committees of both panels have agreed to create bilateral teams that would reconcile differences in the drafts of the RWCs. The first contentious issue on the table to be tackled by the bilateral teams concerns the free distribution of land, he said. Echanis added that if the Caser is signed, “the next and more important phase would be the implementation, both jointly and separately.” “There will be areas of cooperation, but for the most part, the GRP [Government of the Republic of the Philippines] will be enacting, amending or repealing laws, as needed, to implement the Caser and launch programs within the government framework. The NDFP will also be implementing the Caser’s provisions through the revolutionary organs of political power in the countryside,” Echanis said.

Editor: Dionisio L. Pelayo • Thursday, January 26, 2017 A3

Duterte to grant executive clemency to 127 convicts

By Joel R. San Juan

@jrsanjuan1573

USTICE Secretary Vitaliano N. Aguirre II on Wednesday said President Duterte is expected to sign next week an order granting executive clemency to 127 convicts.

Most of the 127 convicts who will be given clemency are elderly and sickly. He noted there are no high-

profile inmates among them. Those who will benefit from the clemency are inmates from the

New Bilibid Prison in Muntinlupa City, the Correctional Institute for Women in Mandaluyong City and other penal colonies operated by the Bureau of Corrections. The list included inmates recommended for commutation of sentences, for conditional pardon with parole, for conditional pardon without parole and for absolute pardon. Aguirre, however, said he could not recall if the list included political prisoners the National Democratic Front of the Philippines (NDFP) asked to be released. The NDFP, currently engaged in

peace talks with the government to end the long-running armed conflict in the country, is seeking the release of all political prisoners. Last year Duterte granted absolute pardon to action star Robin Padilla after he was among those recommended by the Board of Pardons and Parole (BPP) for executive clemency. Padilla, a known supporter of Duterte, was granted conditional pardon in 1997 by then-President Fidel V. Ramos after serving several years of the 21-year sentence imposed on him for illegal posses-

sion of firearms in 1994. The BPP earlier said a total of 473 inmates have sought executive clemency as of November 2015. Executive clemency or pardon is a power given to the President to pardon any prisoner, provided for under Article VII, Section 19 of the Constitution and pertains to reprieve, absolute or conditional pardon with or without parole conditions and commutation of sentence. Parole is the conditional release of prisoners from a correctional institution after they have served the minimum of their sentence.

MMDA: Oil trucks exempt from total ban in Metro roads By Claudeth Mocon-Ciriaco Correspondent

HE Metropolitan Manila D e ve lopme nt Aut hor i ty (MMDA) announced on Wednesday fuel-delivery trucks are exempted from the total truck ban being implemented by the agency. “These fuel delivery trucks are a special exemption because they are essential and vital to our growing transportation sector, tourism and the economy,” MMDA acting Chairman Thomas M. Orbos said. The truck ban is implemented between Edsa-Magallanes, Makati City and E-North Avenue in Quezon City, except Sunday and holidays. Orbos said fuel-delivery trucks can now make their rounds to their respective gas stations along Edsa and at the Ninoy Aquino International Airport (Naia) starting midnight to 4 a.m. The MMDA decided to exempt fuel-delivery trucks after a closed-door meeting with rep-

resentatives of the Petroleum Industry of the Philippines (PIP) on Wednesday at the MMDA main office in Makati City. During the meeting, PIP representatives, on behalf of the major oil companies, requested their delivery trucks carrying aviation fuel to be allowed to refill fuel depots at the Naia as these storage facilities cannot hold large quantities to last for an extended period of time. He said the agency decided to allow fuel trucks to deliver to the Naia to meet the fuel requirements of various passenger airlines and cargo transportation. “We invite other groups from the transport sector to follow the lead of the petroleum industry in being part of the solution.” Also with the exemption, fueldelivery trucks are, likewise, allowed to unload their cargo on gas stations along Edsa beginning midnight to 4 a.m. daily to maintain the regular supply in these depots, Orbos said.

CAT LOVER A woman selling back issues of newspapers and magazines is surrounded by her pet cats in her stall in Libertad, Pasay City. NONIE REYES

Alleged killer of SoKor bizman seeks return to NBI custody

HE alleged killer of South Korean businessman Jee Ick-joo on Wednesday asked the Regional Trial Court (RTC) in Angeles, Pampanga, to order his return to the custody of the National Bureau of Investigation (NBI) from the National Police (PNP) in Camp Crame. In a very urgent motion filed through the Public Attorneys Office (PAO), Senior Police Officer 3 Ricky Sta. Isabel also asked the RTC in Pampanga Branch 58 to direct the Department of Justice (DOJ) to conduct a reinvestigation on charges of kidnapping for ransom with homicide filed against him. Sta. Isabel cited threats to his life as the main reason for seeking his

return to the NBI. He said he does not feel safe inside Camp Crame after he implicated several senior police officials in the case, including his superiors PNP Anti-Illegal Drugs Group-Pampanga (AIDG) Head Supt. Rafael Dumlao and Senior Supt. Allan Macapagal of the PNP Anti-Kidnapping Group. “Since accused herein is a member of the Philippine National Police, detained at the institution’s detention facility, he fears for his life’s security as the same is in imminent danger as he continuously receives death threats,” the pleading read. “Accused [Sta. Isabel] will be safer in the custody of the NBI than with the PNP, considering this case not

only involves him, but also several high- ranking and powerful officials who are still connected with the PNP organization,” it said. Sta. Isabel said even his private lawyers were earlier forced to withdraw their representation “due to threats to their life, security and safety.” Sta. Isabel sought a reinvestigation of the complaint filed against him and several others on the ground of violation of his constitutional right to due process. He said the DOJ filed the complaint before the court without according him his right to disprove the allegations during preliminary investigation. He accused the DOJ of hurriedly issuing a resolution on the charges

on January 17 and subsequently filed the case in court when he was notified the hearing for his submission of answer was set on February 6 and February 13. “Accused herein invokes his right to due process and humbly asks this Honorable Court to accord him such fundamental right under our laws. It is clear from the records that accused SPO3 Sta. Isabel was not given the chance to attend the scheduled hearings and submit his counteraffidavit simply because the DOJ hastily rendered a resolution finding probable cause against him. As such, he should not be deemed to have waived his right to a preliminary investigation,” Sta. Isabel said.

“The Information was hastily filed without giving him the chance to file his counteraffidavit together with the documents to refute the baseless complaint filed against him,” he said. Citing the same grounds, Sta. Isabel also sought to defer his arraignment before the RTC in Pampanga citing the possibility that the charges against him “can either be modified or dismissed”. Sta. Isabel, who earlier surrendered to the NBI and transferred to PNP custody on January 20 after issuance of arrest warrant by the RTC against him and six other accused, admitted in his affidavit that he took part in dispatching the victim’s body, but denied kidnapping and killing Jee himself. Joel R. San Juan

PHL peace works with Reds, Moro groups featured in UN dialogue

YEAR OF THE FIRE ROOSTER

May Cadiente, owner of the Electibles Shop in a Baguio City mall, shows golden rooster figurines priced between P500 and P1,000 depending on size. MAU VICTA

AVAO CITY—The country’s aggressive peace negotiations with both the Communist and Moro-led revolutionary groups took center stage in one of two United Nations dialogues on peace, the Office of the Presidential Adviser on the Peace Process (Opapp) said. Presidential Peace Adviser Secretary Jesus G. Dureza presented and discussed the developments in both talks with insurgent groups in the two successive days of separate sessions at the UN General Assembly Headquarters in New York City this week. The Opapp said Dureza, “under instructions from Malacañang, flew from Rome, where the peace negotiations with the Communist Party of the Philippines/New People’s Army/National Democratic Front [CPP/NPA/NDF] are still ongoing and spoke on the current status of the Philippine peace process at the UN.” The UN General Assembly president for the UN’s 71st session convened the high-level dialogue on

“building sustainable peace for all” on January 24 (January 25, Philippine time), the Opapp said. The Opapp added Dureza gave an impromptu speech before the assembly as he described the status in the ongoing peace talks with the CPP/NPA/NDF in Rome and with the Bangsamoro, “where development to improve the lives of the people on the ground is crucial.” The Opapp said Dureza “reaffirmed the country’s solidarity with other nations pursuant to the sustainable development goals [SDGs] that seek to promote peaceful and inclusive societies for sustainable development.” “The Philippines is one with the global community in affirming sustainable development cannot be realized with peace and security, and peace and security will be at risk without sustainable development,” Dureza said. Dureza also relayed “the warm greetings” of President Duterte and the Filipino people to the world leaders present.

Economy

A4 Thursday, January 26, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

DENR expected to reveal mine-audit result on Feb. 2 By Jonathan L. Mayuga @jonlmayuga

ining’s big players under the Chamber of Mines of the Philippines (COMP) continue to hold on to President Duterte’s promise to weed out irresponsible mining while helping the industry grow to achieve its full economic potential through responsible mining. This, as the Department of Environment and Natural Resources (DENR) is set to announce the final mine-audit results on February 2. The fate of 30 mining companies that failed the initial audit conducted by the DENR last year hangs in the balance, as the DENR tightens the screw on mining through a strict audit criteria that includes environmental, biodiversity and social considerations. Ronald Recidoro, vice president of COMP, said this is the meat of the message delivered by Environment Undersecretary and Mines and Geosciences Bureau (MGB) Director Mario Luis Jacinto during the Japan Oil, Gas and Metals National Corp. (Jogmec) seminar on sustainable development of mineral resources at the New World Hotel in Makati City last Monday. To recall, barely one week after she assumed office on July 1, Environment Secretary Regina Paz L. Lopez immediately ordered a review of all 41 operating metallic mines in the country. Based on the initial results released last September 27, only 11 mining companies “passed” the audit, with 10 mining operations slapped with suspension and 20 others facing possible suspension failing to meet environmental standards. Among the major findings of the team were violations of the terms and conditions of the environmental compliance certificate (ECC) and Department Administrative Order (DAO) 2010-21, or the revised implementing rules and regulations of Republic Act (RA) 7942, otherwise known as the Philippine Mining Act of 1995, and DAO 200-98, which refers to Mine Safety and Health Standard. On the other hand, as part of an ongoing audit of ECCs, the DENR had ordered the cancellation of at least 11 ECCs for various mining projects that Lopez deemed as potentially destructive to the environment and will cause people to suffer. The DENR chief, a passionate biodiversity advocate, is a known critic of large-scale mining. She vowed to come up with the result of the mining audit by the end of the month. She said the DENR, headed by mining audit head and Mining and Geosciences Board Assistant Director Danilo Uykieng, is currently evaluating the reply and responses of the mining companies to the show-cause orders. During his brief talk, Jacinto, a geologist and a consultant to several mining companies prior to being appointed by President Duterte, assured stakeholders and investors of the government support, despite the feeling of

uncertainty hounding the mining industry. “What the good DENR official wants to tell the industry is that President Duterte remains committed to responsible mining,” Recidoro said. No other DENR official, he added, understands the language of the minerals development sector better than Jacinto because of his experience as MGB official and consultant to mining companies in Mindanao for decades. “For me, his assurance that only responsible mining will be allowed under the Duterte administration is very much welcome,” Recidoro said. He noted that Jacinto, during an earlier meeting with businessmen in Davao City last November, set four major criteria for mining to be allowed. The criteria, which calls for mining projects to be environmentally, technically, financially and socially sound, only means that the government is serious in helping the industry grow and contribute to economic growth and development, Recidoro said. Speaking during the Jogmec seminar, Jacinto stressed Duterte is keen on having all industries contribute to the country’s development. Guided by “real change with compassion”, Jacinto said, “for a genuine and meaningful change in mineral resources development, the President has given these marching orders for the mineral industry: ensure responsible mining; adopt the best internationally accepted practices; and maximize the benefit for the people and the communities in all possible ways.” The MGB official reiterated that under the Duterte administration, “responsible miners have nothing to fear”. “The challenge is to squarely address legitimate concerns; provide proper information to have a shared perspective of development options, and patiently reason with oppositors to set aside unreasonable demands,” Jacinto said. He added that host communities must be involved in environmental protection and enhancement programs—and must also have a sense of ownership of the social-development plans in their respective communities. Jacinto also assured investors of an environment conducive for business with government fighting crime, stopping corruption and working toward lasting peace. According to Jacinto,the government will study policies to best position the country in the world minerals, market while information sharing with the industry stakeholders will be pursued at every opportunity. “Geological maps and reports, geohazard maps and studies, and watershed maps already available will be provided to and analyzed with industry partners to have a common appreciation of the areas with potential for development and identify the elements at risk in the different areas,” he said.

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PSA revises Q3 2016 growth figure

By Cai U. Ordinario

@cuo_bm

he Philippine Statistics Authority (PSA) has revised downward its estimates for the country’s thirdquarter economic growth.

On Wednesday the PSA said the country’s GDP in the third quarter grew 7 percent, instead of the initial estimate of 7.1 percent. “The top 3 contributors to the revision were Financial Intermediation, Real Estate, Renting and Business Activities, and Agriculture and Forestry,” the PSA said. With the revisions, the PSA said the gross national income and net primary income from the rest of the world were, likewise, revised to 6.2 percent and 2.3 percent, respectively.

These, the PSA said, are lower than the corresponding preliminary growths of 6.3 percent and 2.5 percent. “The PSA revises the GDP estimates based on an approved revision policy, which is consistent with international standard practices on national accounts revisions,” the PSA said. The revised estimate showed that third-quarter growth was on a par with the second-quarter economic performance and higher

7% The PSA’s latest growth figure in the third quarter of last year, instead of the previous 7.1 percent estimate

than the 6.2-percent growth posted in the third quarter of 2015.

Still the fastest in Asia

Even with the downward revision, the Philippines remains the fastest-growing economy among Asia’s emerging countries in the third quarter.

Waiting for Q4 results

Earlier, the National Economic and Development Authority (Neda) said the economy could exceed its growth targets this year if fourthquarter performance will be higher than expected. Socioeconomic Planning Secretary Ernesto M. Pernia said exceeding a growth of 7 percent will depend on the fourth quarter. Pernia said if the economy grows between 7.2 percent and 7.3 percent in the October-to-December period, exceeding the 6.5-percent to 7-percent target for the year is possible. The country’s growth outlook for 2017 is 6.5 percent to 7.5 percent and annually between 2018 and 2022, 7 percent to 8 percent.

Biz group offers support and services to Duterte admin’s Moscow initiative

Finishing touches

Construction workers put finishing touches on the railway support of the Light Railway Transit 2 Extension Project on Sumulong Highway in Antipolo City. NONOY LACZA

PSA reports 20.1% decline in marriages in past decade ewer Filipinos have been getting married in the past decade, according to the Philippine Statistics Authority (PSA). PSA data showed that between 2005 and 2015, reported marriages declined 20.1 percent. The PSA also reported that registered marriages declined by 2.9 percent in 2014 and 3.6 percent in 2015. “The number of registered marriages showed an erratic trend for the past 10 years,” the PSA said. “It is also interesting to note that from that year up to 2015, the number of marriages declined continuously.” The PSA said most notable change occurred in 2013, which recorded a decrease of 8.2 percent from 482,399 in 2012 to 442,603. Data showed that 15 out of 18 regions saw a decrease in the number of registered marriages in 2015. Regions that had large decreases in marriages were led by Soccksargen which saw a 10.6-percent decrease in registered marriages in 2015. This was followed by the Cordillera Administrative Region, with a contraction of 8.6 percent; Ilocos, 8.1 percent; and Negros Island region, 7.8 percent. Regions that saw an increase in registered marriages were led by Autonomous Region in Muslim Mind-

The country grew faster than China, which posted a growth of 6.7 percent; Vietnam, 6.4 percent; Indonesia, 5 percent; and Malaysia, 4.3 percent.

anao, with an 85.6-percent growth in registered marriages. This was followed by Eastern Visayas, at 18.8 percent and Central Visayas, at 2.4 percent. These regions were the only ones that posted a positive growth of registered marriages. Data showed there were 1,135 marriages solemnized daily through different ceremonies in 2015. Of the total marriages, 42.7 percent were contracted through civil rites. Other matrimonial ceremonies were officiated in Roman Catholic churches, 36.2 percent; other religious sect rites, 19.1 percent; Muslim tradition, 1.2 percent; and tribal wedding rites, 0.8 percent. Meanwhile, data showed the median age of marriage for brides and grooms are 26 and 28, respectively. Most of the brides marry at ages 20 to 24, reaching 140,738, or 34 percent, of the total. The PSA said the majority of the grooms preferred to marry between the ages of 25 and 29, reaching 145,952, or 35.2 percent, of the total. “Marriages involving teenage brides were five times more than marriage with teenage grooms. It was also observed that there were marriages recorded involving adolescents aged under 15,” the PSA said.

1,135 marriages The total number of unions solemnized daily through various ceremonies in 2015. 42.7 percent were contracted through civil rites While most brides preferred to marry between ages 20 and 24, those marriages that were solemnized in Muslim and other religious sect rites were older at 25 to 29 years old. Meanwhile, regardless of preferences of wedding ceremony, most grooms preferred to marry between ages 25 and 29 through different ceremonies, except for those who marry in tribal rites, which involved younger grooms aged 20 to 24. Data on marriages presented in this release were obtained from the Certificates of Marriage (Municipal Form 97) that were registered at the Office of the City/Municipal Civil Registrars all throughout the country and forwarded to the PSA. Information presented include registered marriages that occurred from January to December 2015.

Cai U. Ordinario

mid recent moves undertaken by the Philippines to forge new ties and trade deals with Russia, the Philippine-Russian Business Assembly (PRBA) has reiterated its offer of support and services to the Duterte administration. Since its establishment in 2009, the PRBA has been the principal organization driving business relations between the Philippines and the Russian Federation. Over the years, it has organized successful two-way trade and tourism missions where business matching, education and promotions activities have resulted in the signing of twin-city agreements (e.g., St.Peterburg and Dipolog City), establishment of PRBA’s counterpart business council in Russia (i.e., RussiaPhilippines Business Council), and—important—a rise in Russian arrivals in the country for touristic and business-exploration purposes. In offering its services to the Duterte administration, PRBA said its extensive experience in dealing with the Russian government and business community makes it well-suited to “take the lead in materializing privatesector cooperation initiatives between the business communities of the two countries in support of the overall direction of the economic relations between the Philippines and Russia.” It is also well prepared to help organize a business delegation to accompany the President when he visits Russia later this year. PRBA is a network of businesses involved real estate, airline and travel, financial services, construction, shipping, supply chain/logistics management, education and other industries. Leading PRBA since 2009 is Russian Honorary Consul Armi Lopez Garcia, whose tenure—first, as president of PRBA and now as chairman of the PRBA board—has largely responsible for the initial gains toward mutually beneficial and sustained relations between the two countries. Garcia is a Cebu-based business leader whose business interests lie in the food, hotel and resorts industries, among others. PRBA counts prominent leaders in business, industry, education and public service among its directors (i.e., including Marita Limlingan, Alberto Fenix, Ambassador Jose Abeto Zaide, Geronimo Sta. Ana, Architect Maxwell Espina, Carlo de Asis, Caesar Atienza, Victor Limlingan, Oscar Violago and Jesus B. Garcia Jr).

Agriculture/Commodities news@businessmirror.com.ph

BusinessMirror

Editor: Jennifer A. Ng • Thursday, January 26, 2017

PHL fish output down 6.34% in 2016 Locusts destroy ₧20M worth of crops in S. Cotabato town

A fisherman gathers seaweed in Sabangan, Ilocos Sur. According to the Philippine Statistics Authority, seaweed farms were struck by various diseases last year, causing output to decline. MAU VICTA

By Jasper Emmanuel Y. Arcalas

@jearcalas

nfavorable weather caused the country’s fisheries production to decline by 6.34 percent to 4.35 million metric tons (MMT) in 2016, from 4.69 MMT in 2015, according to the Philippine Statistics Authority (PSA). In its report, titled “Fisheries Situation 2016,” the PSA said all fisheries subsectors posted production declines. “The decline was reflected in all subsectors, namely, commercial [6.35 percent], municipal fisheries [6.47 percent] and aquaculture [6.27 percent],” the PSA said in the report published on Tuesday. Commercial fisheries recorded a total volume output of 1.05 MMT, compared to the 1.084 MMT posted in 2015, according to the PSA. Commercial fisheries accounted for 23.33 percent of the sector’s total production. “ L e s s s p e c ie s we re c au g ht

because of hot seawater temperat ure brought about by El Niño phenomenon that prevailed during the first semester,” the report read. The PSA report showed that municipal fisheries production, which accounted for 26.13 percent of total output, declined to 1.4 MMT in 2016, from 1.22 MMT in 2015. Of the figure, 976,838 metric tons (MT) were caught in marine municipal fishing grounds. This was 3.45 percent lower than the 1.01 MMT recorded in 2015. Meanwhile, fish caught in inland municipal fishing grounds declined by more than a fifth, or

by 21.37 percent, to 160,989 MT in 2016, from 204,733 MT recorded in 2015. “Less fishing activities were observed as prolonged hot weather conditions were experienced in the coastal areas followed by rough seas and typhoons toward the end of the year,” the PSA said. Fish caught in aquacu lt ure farms, which accounted for half of the countr y’s total production last year, dropped by 6.27 percent to 2.2 MMT, from 2.35 MMT in 2015. “High mortality and slow growth of species happened amid dry spell. Seaweed farms were affected by ice-ice disease and epiphytes,” the report read. “Scarcity of planting materials and low buying price offered by seaweed traders all year round resulted to less aqua farms in operations,” it added. The government is targeting to increase commercial fishing production by 2.5 percent and municipal fishing by 1 percent annually between 2017 and 2022, according to the draft chapter of the Philippine Development Plan 2017-2022. The draft blueprint added that the government is eyeing to increase aquaculture production by 5 percent every year.

ENER A L SA NTOS CIT Y— Around P20 million worth of agricultural crops have been destroyed in some parts of the municipality of T’boli in South Cotabato due to the worsening locust infestation in the area. Barry Lugan, T’boli municipal agriculture officer, said on Wednesday the continuing infestation has already affected around 700 hectares of palay and corn farmlands in four of its barangays since late last year. He specifically cited the upland farming villages of Maan, Mongocayo, Salacafe and Tudok. “The infestation was very damaging to our farmers, and most of the crops affected were in their vegetative and reproductive stages,” he said. Lugan said the areas affected by the infestation have been expanding, with Barangay Tudok reporting an additional damaged area of around 100 hectares last Monday. The official said they are currently conducting massive chemical spraying in the affected farms in coordination with barangay officials and other community stakeholders. He said they are also educating farmers on biological control measures to help prevent the spread of locusts. T’boli Mayor Dibu Tuan has ordered the release of additional funding for the purchase of chemicals and spraying equipment. The South Cotabato Office of the Provincial Agriculturist (Opag) and the Department of Agriculture in Region 12 have also provided support to the local government. “We’re currently doing massive interventions to destroy the locusts while they are in the early stages. They multiply rapidly and mature in just three days, so we really have to move fast,” he said. In line with the chemical-spraying activities, Lugan said they have also launched massive information and education activities to warn residents from gathering and consuming locusts. He said the move is aimed at preventing possible poisoning among residents. Cooked or fried locust is considered as a delicacy in some localities in the province. “We have put up signages to warn the public that a farm area underwent chemical spraying and it is not safe to gather and eat locusts from that area,” he said. Justina Navarrete, Opag chief, initially reported the onset of locust infestation in the province during the last quarter of 2016. PNA

Year of the Rooster seen waking up China’s palm-oil demand

s China welcomes the Year of the Rooster this week, bets that a recovery in Asian palm-oil production will drive prices lower may be something for consumers to crow about. While high prices may keep Chinese buyers on the sidelines in the first part of the new year, an expected surge in supply later in 2017 in the world’s top producers will drive a jump in purchases as prices decline, according to analysts and traders. China begins a weeklong Lunar New Year holiday on January 27 and palm oil is used to fry noodles, dumplings and spring rolls. China’s imports plunged 24 percent to 4.48 million metric tons in 2016, the lowest since 2005, as benchmark f utures surged 25 percent after El Niño squeezed supplies in Indonesia and Malaysia. A weaker yuan and state sales of rapeseed-oil reserves also reduced the attractiveness

of palm oil for local buyers. With production set to recover in the two biggest producers in the second half, prices should fall to levels that attract Chinese buying, according to veteran edible-oils analyst James Fry. “China, like India, is a pricesensitive market,” Fry, the chairman of LMC International Ltd., said in an interview in Kuala Lumpur on January 17. “As we get a ramp up in palm production, then we will see China buying more palm oil.” The El Niño between 2015 and early 2016 reduced global palmoil output by 6.8 million tons last year, Ling Ah Hong, director of Malaysian plantation consultant Ganling Sdn., said on January 17. As rain returns, production in the second half of this year will recover strongly with double-digit growth each month, said Ling, who has 40 years experience in the plantation industry. Increasing supply will soften

prices, which may drop as low as 2,200 ringgit ($496) toward the last quarter of the year, he added. Benchmark palm-oil prices on the Bursa Malaysia Derivatives closed the morning session on Wednesday at 3,123 ringgit a ton. “In the second quarter, following the recovery of production in major exporting countries, palmoil prices may decrease,” making it more competitive with soyoil and rapeseed oil and driving imports again, said Zheng Zuting, an analyst at China National Grain and Oils Information Center (NGOIC). The decline in inbound shipments last year, coupled with low inventories, could see China’s imports recover sooner. Purchases may jump 10 percent to 15 percent in the first half, according to Tommy Xiao, an analyst at Shanghai JC Intelligence Co. They may reach 5.1 million tons to 5.2 million tons in the year started October 2016, from

4.7 million tons a year earlier, he said. CNGOIC estimates that imports may total 5 million tons in 2016-2017. Volumes, still, may not reach the records seen two to three years ago when traders purchased large amounts to boost inventories for financing purposes, according to Gao Yanbin, an investment manager with agriculture investment firm Shanghai Shenkai Investment Co. Imports are now largely driven by demand, and inventories would be kept at a low level, Gao said. “China may buy more palm oil in the third quarter, in line with higher production and possibly lower prices,” said Alan Lim, plantations and property analyst at MIDF Amanah Investment Bank Bhd. “The factor that consumers in China take into consideration is the discount between crude palm oil and soybean oil. If the discount widens, they will shift more of their consumption to palm oil.” Bloomberg News

TheBroa

Business

A6 Thursday, January 26, 2017

Filipino-Chinese interracial m W

By Roger Pe

AY before Ferdinand Magellan discovered the Philippines, Chinese merchants had been openly trading with Filipinos as far back as the 9th century.

and their offsprings became subjects of Spain. With that, came a number of privileges and many opportunities. Hispanize meant having Chinese surnames reflecting their own heritage. Thus, the full name of a Chinese ancestor would read like a one-word surname: Cojuangco, Landicho, Ongpin, Cuyegkeng, Tambunting, Tiongson, Yuchengco, Yupangco, Limcaoco, Ongpauco, Tanchanco, Yaptinchay, Gozon, etc. But even with that, traditional Chinese culture deeply grew its roots in the Philippines and the Chinese did not lose its age-old family traditions. One such was a Chinese must only be married to a fellow Chinese. Marrying a Filipino or a foreigner, for that matter, was considered taboo, thus, creating irreconcilable issues to both parties. Patriarchal in family structure, a member of a traditional Chinese-Filipino family may be denied of his or her inheritance, and is likely to be disowned by his or her family by marrying an outsider without permission. There are some exceptions, however, where intermarriage to a Filipino is acceptable—if the Filipino’s family is well-off, influential or born to power. Today, modern Chinese-Filipino families allow their children to marry Filipinos. But many of them still respect tradition and or would still prefer that the Filipino would have some Chinese blood.

Cultural differences Manad Apichaiwong | Dreamstime.com

As proven by Chinese artifacts found in many places in the country, the evidence is well documented. According to historians, some local rajahs and datus, themselves, even belonged to a generation of Chinoys (ChineseFilipinos), product of inter-marriages between Chinese settlers and Filipinos. During the Spanish colonial period, Spanish authorities encouraged Chinese male immigrants to convert to Catholicism. Those who did were baptized and their names Hispanized. They were then allowed to marry local women, even Spanish women,

ON the Me On Pause blog, the anonymous author brings us to the realm of Chinoy marriages. The insights are enlightening and the interaction between the writer and those who are in a similar situation give readers words to live by. Here are some of them: “A girl once asked her mom why Chinese parents prefer Chinese partners for their kids. She said, ‘The

culture is so different. In a Chinese family, the parents are the head of the business. Hence, they are the treasurer of the house. In a Filipino family, the kids provide for their parents the moment they start working. They also provide support to other relatives who may be in need.’ In short, she is concerned that the Filipino partner will get money from the business pot to provide for his/her family.” Does marrying a Chinese to a Chinese guarantee marital bliss and prosperity? The blog author continues: “I’ve met way too many pure and mixed couple to know.” “What matters the most are the following: 1. God is at the core of the relationship 2. There is love between the couple 3. Both families have given the couple their blessing. These are the foundation to a strong marriage, not money, not social class, not race.” But some are unlucky. There are those that break apart, prompting writers Aurora Teo Mei Ling and Coylee Gamboa to write a book on the subject, Broken Mirror. In the book, Teo and Gamboa show the secret world of FilipinoChinese marriages. “In a culture where a woman’s silence in the face of abuse and maltreatment is viewed as a virtue because of self-

aderLook

sMirror

www.businessmirror.com.ph | Thursday, January 26, 2017

marriage: A cracked mirror? Manun Ngueampha | Dreamstime.com

Patriarchal in family structure, a member of a traditional ChineseFilipino family may be denied of his or her inheritance, and is likely to be disowned by his or her family by marrying an outsider without permission. There are some exceptions, however, where intermarriage to a Filipino is acceptable—if the Filipino’s family is well off, influential or born to power.

sacrifice and submission, the main character, Aurora, defies tradition as she breaks the code of silence and divulges secrets of a Chinese marriage,” the book says.

Making of ‘Broken Mirror’

THIS is Aurora Teo Mei Ling’s story as it happened to her. It is drama in real life—not a fictitious account. A real person went through all the experiences that are chronicled in this book. Names, locations and some details were altered to protect the identity of her children. But everything happened in real life. Broken Mirror is a largely autobiographical account of Aurora’s life that she narrated and Gamboa wrote. Aurora is half-Filipino and halfChinese. She grew up in a family held together by her strong-willed Chinese father and she married an immigrant from China, so naturally those facts influenced our setting. Here are the highlights of the interview by the BusinessMirror with Coylee Gamboa: What is ‘Broken Mirror’ all about? Broken Mirror is the true-tolife story of a woman who endures great suffering—from the loss of her mother at the age of 2, followed

by her exile to Hong Kong at the age of 3. There, in the care of her father’s first wife, she is abused and molested as a child until the age of 7, when he brings her back to the Philippines. Her father, an immigrant from China, raises her with his children from his mistresses, putting them to work in his junkyard at an early age to teach them not just the business and the conduct of business, but also his homespun values like hard work and perseverance. But her father is distant and often absent, which leaves her hungry for genuine affection. Aurora searches for love and ends up marrying an immigrant from China. She strives to be a traditional Chinese wife until their marriage breaks up. How did you come to collaborate on writing this book? Aurora and I were classmates in an art class. She was looking for a writer to help her with her story and I agreed to listen to her. I was spellbound by her story. When we started this, she was going through the breakup of her marriage and she was in pain— great emotional pain. She brought to the table her story—the stark

reality of it and the rawness of her emotions. No woman should have to go through that alone. I brought to the table my skill as a writer, as well as compassion, kindness and acceptance of her as a person. There was no judgment of her actions. My role was to elicit the story and to put it in context. I drew it out of her—very gently—because I could see how painful her life had been. She needed to tell somebody the whole story and I was that person. It took courage for Aurora to bare her soul and her deepest secrets to another person. It was also not easy for me to listen to it and to be there for her through some of her darkest days. Our friendship was forged in the crucible of writing this book. Often, I felt the heaviness of her pain, a burden that could be relieved only by lifting her situation up to God. She wasn’t aware that I was praying for her to be strengthened, to find a way out of her darkness and to emerge from it on her way to wholeness as a person. The remarkable thing is that she does emerge (from this process of writing the book) stronger and determined. It is amazing how she has endured all that happened to her and

Where did the inspiration for the book title come from? It came from a short story “The Maze of Mirrors” that I had crafted for my nephew about a bunch of kids that entered a magical maze of mirrors. In one corner, full of cobwebs and shrouded was the most powerful mirror of the lot. It could reveal the future. But this powerful mirror was broken in an earthquake and the souls of people who were peering into were trapped on the other side. From that time on, the mirror was shrouded so that no one would ever look into it and be unable to return. I suggested to Aurora that we work “broken mirror” in as a theme and she soared with it. She contemplated the theme and, a week later, got back to me with her reflections. I wove those reflections into her story until it was seamless. We bore this theme in mind as we continued with the project. At which point did you or she decide to publish the story? While we were writing the story, I knew the material that was coming from Aurora was explosive. I was her first audience and her story moved me tremendously. I knew it would find resonance in other women’s lives, but it was her story and hers to do as she pleased. So I waited as she went through the process.

When we were almost done with the book, after one particularly dark episode in her life, Aurora said to me that writing the book has been a catharsis for her and that it has strengthened her. But, she added, writing it was not enough. After having people tell her—throughout her childhood and marriage—that she was worthless as a person, Aurora wanted her life to be worthwhile, to be of value. She decided to use her life story to reach out to and help other women in similar situations. Through the book, she is telling them that they are worthwhile and precious, that others are suffering as they do and they’re not alone. But, more important, she’s telling them there’s hope and they shouldn’t give up. They can break free of the shackles of tradition and live fruitful and happy lives. Do you have statistics of how many women actually suffer such abuse? No, we don’t have such statistics, but the media is full of such horror stories—from a third-person point of view. Someone else is reporting about abused women. To my knowledge, this is the first time that someone here has come out to tell her own story of what went on in her life and her marriage. That’s why Broken Mirror is groundbreaking. It is especially groundbreaking because the Chinese don’t talk about what goes on in their personal life. Generally speaking, they always maintain an inscrutable façade. Aurora breaks that code of silence and reveals her secrets. In other words, she lets us in behind the façade.

Her revelations have nothing to do with being part Filipino and, therefore, being able to speak out. Her revelations have everything to do with telling her story in order to help other women. Women who’ve read the synopsis or draft of her book tell her, “You’re so brave to come out with you story.” Others have said, “That’s my story!” She’s given all these women, not just Chinese women but women who are confined by their customs, a voice. Personally, I think that, anywhere in this world where women are suffering abuse of some sort, there will be women who see themselves in Aurora’s story and they will be able to relate to it. I am confident that this book will have a global resonance and reach. You mentioned global resonance and reach. Are you taking this book to the global market? Yes, indeed, we are. Caelestis Production Inc., through its President and CEO Sally Jo Bellosillo, is helping us do that. We are launching the book in the Philippines in time for the Chinese New Year right up to Valentine’s Day. After that, we will launch in select international markets. People are already talking to us about the possibility of turning Aurora’s life story into a movie. We will get there in the not-toodistant future, I hope. But, in the immediate future, we’re focused on launching the book. I think it’s only fitting that our partners for the launching of Broken Mirror are the BusinessMirror, Philippines Graphic and, of course, Manila Grand Opera Hotel, the venue of our launch. We are delighted with the partnership.

Things we know about Coylee Gamboa

n has a Master’s degree in Communications from Stanford University; n has a degree in Bachelor of Arts in Journalism from the University of the Philippines; n was the financial markets editor of the Asian Wall Street Journal in Hong Kong; n former news editor of the Business Times of Singapore; n Based in Manila today, Coylee is an editor and a book writer who assists people with their life’s work and memoirs. n She also takes photographs and paints. n She collaborates with the ecumenical Marketplace Leaders Foundation and the Pimentel Institute for Local Governance on initiatives for national transformation.

Alistair Mcdonald | Dreamstime.com

Ivan Cheung | Dreamstime.com

still be the kind soul that she is. Aurora is gentle, generous and quietly strong. She’s also affectionate, funny, fun loving and (if I might add) very astute in business. She’s a wonderful person and I am privileged to be working with her on this project.

Thursday, January 26, 2017

The World

Watchdog group: Corruption worsens under populist leaders

ERLIN—People who turn to populist politicians promising to upset the status quo and end corruption may only be feeding the problem, an anticorruption watchdog group warned on Wednesday. Transparency International (TI) said in its annual Corruption Perceptions Index for 2016 that in countries with populist or autocratic leaders, “instead of tackling crony capitalism, those leaders usually install even worse forms of corrupt systems.” The group’s board chairman, Jose Ugaz, cited Hungary and Turkey as examples. Their scores have worsened in recent years under leaders with authoritarian leanings, while Argentina, which ousted a populist government, has improved in the rankings, he said. Based on expert opinions of public-sector corruption, the annual report rated Denmark and New Zealand as the least-corrupt countries, followed by Finland, Sweden, Switzerland and Norway. Somalia was ranked most corrupt, followed by South Sudan, North Korea and Syria. Rounding out the Top 10 least corrupt were Singapore, the Netherlands, Canada, and the tie-placing trio of Germany, Luxembourg and the United Kingdom in the No. 10 spot. The United States placed 18th, down from 16th in 2015. TI Research Director Finn Heinrich told The Associated Press that the organization was taking a wait-and-see approach to Donald J. Trump’s presidency, but that already it had “serious concerns”.

“Donald Trump came on board as the people in Hungary and Turkey, on an anticorruption ticket. He said, ‘We’re going to drain this swamp,’” Heinrich said. “But if you look at his action so far, there is nepotism.... The people in his Cabinet have many conflicts of interest. They are not people who stand for transparency.” The index scores countries on a range of factors, such as whether government officials are held to account or go unpunished for corruption; the perceived prevalence of bribery; and whether public institutions respond to citizens’ needs. Nearly 70 percent of the 176 countries scored below 50 on the 100-point scale, with a zero meaning a country is perceived to be highly corrupt and 100 indicating it’s perceived to be very clean. “ T his year more countr ies declined in the index than improved, showing the need for urgent action,” the report said. The country that dropped most sharply in the rankings was Qatar, which has faced criticism over alleged human-rights abuses involving migrant construction workers since it was chosen to host the 2022 World Cup of soccer. It dropped 10 points, falling to 31st on the list from 22nd last year. Still, Heinrich said Qatar’s government has in the past shown itself “willing and keen” to fight corruption, and that TI would appeal to them for more fundamental reforms to ensure better freedom of speech and more media freedom, among other things. AP

BusinessMirror

www.businessmirror.com.ph

Facing Trump, Mexicans think the unthinkable: Leaving Nafta

EXICO CITY—Not long ago, any suggestion that Mexico might walk away from the North American Free Trade Agreement (Nafta) would have been met with utter disbelief.

That was before Donald J. Trump was elected president of the United States. Free trade is a mantra of Mexico’s political elite, the core of the country’s development strategy. But now that Trump has said he wants to renegotiate Nafta, a growing number of Mexican officials and businesspeople are asking what price is worth paying to stay in it. Many of them are concluding that Mexico could have more to lose from years of haggling and economic uncertainty than from simply opting out. “There could be no other option,” Economy Minister Ildefonso Guajardo said on Tuesday on television. “If we go for something that is less than what we have, well, then there is no sense in staying.” About $1.4 billion in goods go back and forth across the Mexico-US border ever y day. The US buys almost 80 percent

of Mexico’s exports, and Mexico is the second-largest market in the world for US goods. Exactly how Trump’s government is proposing to renegotiate that flow is still unclear. The Mexican government says Guajardo and Mexico’s foreign minister, Luis Videgaray, expect to get a first look when they arrive in Washington on Wednesday for two days of talks with officials in the Trump administration. Mexico’s president, Enrique Peña Nieto, is then scheduled to meet Trump on January 31. The Mexican government’s talk of walking away from Nafta if the Trump administration demands terms that are too tough could be strategic bluster, a tactic to begin the discussions on stronger footing. To drive home Mexico’s importance to the US, the Mexicans also intend to raise many other issues that bind the two countries together—including migration, border security and drug trafficking. The US depends on Mexico to fight drug cartels and stop migrants from Central America and other regions who are trying to reach the US. On Wednesday Trump is expected to sign an executive order to build a wall on the border. Peña Nieto’s administration is trying to present “a package deal” to the Trump administration, in

a tacit warning the proposed wall would be an inadequate replacement for Mexico’s help on migration and security. The message Mexico hopes to deliver is that “if you build your wall, the wall will have to substitute everything that we used to do,” said Jorge Castañeda, a former Mexican foreign minister. And by tying trade to security, Mexico will also be able to buy time in negotiations, contended Rafael Fernández de Castro, an adviser to former President Felipe Calderón. More time could allow businesses in the US that depend on Nafta, along with states, like Texas, that send billions of dollars in exports to Mexico, to make their own case for preserving the agreement. But the suggestion that ardent free traders in Mexico are even entertaining the idea of leaving Nafta is evidence of the turmoil Tr ump’s election has created south of the border. D u r i ng t he e lec t ion c a m paign, Trump called Nafta “the single worst trade dea l ever approved in this country” and promised to renegotiate it or pull the US out of it. He has threatened to impose a “border tax” on companies that move factories to other countries and send their products back to the US. Trump built his campaign on a promise to return manufacturing from lower-wage countries, like Mexico, to the depressed towns of America’s Rust Belt. Since the election, his warnings have already had a paralyzing effect in Mexico. The peso has sunk to record lows. The Ford Motor Co. has canceled a $1.6-billion factory, and Genera l Motors has announced it will send some auto parts work back to the US. Uncertainty is sure to stall future foreign direct investment.

So far, Peña Nieto has offered a ringing affirmation of Mexico’s commitment to free trade. “We must preserve free trade a mong C a nad a, t he United States and Mexico,” he said on Mond ay, lay ing out Mex ico’s foreign policy in the face of the Trump policy. “ Trade among the three countries must be free of any tariff or quota.” But the emerging belief that no Nafta may be preferable to years of fractious negotiations came into the open during a discussion this month at the elite university that is the brain trust of Mexico’s free-trade gospel. Many of Mexico’s government ministers have studied or taught at the university, the Autonomous Technological Institute of Mexico, and some of those who were the architects of Nafta were on hand to hear the rector, Arturo Fernández, say the unthinkable. “It would be, perhaps, preferable to leave Nafta aside rather than a long process of negotiation and tension,” Fernández said. Castañeda, the former foreign minister, who proposed last November that Mexico should consider leaving Nafta if Washington demanded a full-blown renegotiation, said policy-makers had come around to the idea that “they have a choice between a terrible Plan A and a terrible Plan B.” Many businesspeople have made peace with that idea. “We have our own principles that we have to defend,” said Juan Pablo Castañón, the president of Mexico’s Business Coordinating Council, a coalition of business groups. “If there aren’t the right conditions, then we have to contemplate the possibility of not staying within the treaty and working with international rules instead.” New York Times News Service

SC’s Brexit ruling shows cracks in UK’s centuries-old institutions

ONDON—It remains unclear whether Prime Minister Theresa May’s plans or timetable for taking Britain out of the European Union (EU) will be altered by the Supreme Court’s ruling on Tuesday that she must secure Parliament’s approval before beginning the process. Most analysts, even those who opposed “Brexit”, as the departure from the bloc is known, doubt that it will. And May had already said in her speech on Brexit last week that Parliament would have a vote on whether to accept the final deal negotiated with the EU. But the ruling on Tuesday— which included a decision to deny the Scottish, Welsh and Northern Irish legislatures a veto in the matter—has brought to the fore some ancient tensions in Britain’s democracy, which has somehow made it through the centuries with an unequal union of four nations, an unelected upper house of Parliament and without a written constitution. These tensions may ultimately have far greater effect than a ruling that was widely anticipated. “There are some fairly serious questions about how the UK’s constitutional settlement operates, not least the lack of democracy at the heart of the houses of Parliament,” Stephen Gethins, the Scottish National Party’s spokesman on Europe in the British Parliament, said in an interview. “All this raises quite substantial questions about the future of the union.”

The strongest words of protest arose from the nations of the United Kingdom whose voters opposed Brexit. In Scotland the first minister, Nicola Sturgeon, said on Tuesday the case for a second referendum on independence was growing ever stronger. “It’s becoming clearer by the day that Scotland’s voice is simply not being heard or listened to within the UK,” Sturgeon said. In Northern Ireland, where the fragile 1998 Good Friday Agreement that ended decades of sectarian conflict is predicated on membership in the EU and an open border with Ireland, the decision not to give its Parliament a vote risks aggravating the sectarian divide, officials said. “Brexit will undermine the institutional, constitutional and legal integrity of the Good Friday Agreement,” said Gerry Adams, the leader of Sinn Fein, which represents the Catholic nationalist community in Northern Ireland. “Our stability and economic progress,” he said, “are regarded as collateral damage.” In its ruling, which upholds an earlier decision by the High Court in London, the Supreme Cour t noted that Parliament had approved the 1972 legislation that enabled the countr y to join the EU and incor porated European law into British law. Leav ing the bloc wou ld ta ke away from Br itish citizens a number of rights that had been granted by the bloc.

As a result, “the government cannot trigger Article 50 without an act of Parliament authorizing that course,” David Neuberger, the Supreme Court’s president, said in announcing the decision, which was approved, 8-3. A lthough a majority of lawmakers had campaigned to stay in the EU before the referendum last year, most political obser vers said it was unlikely that legislators would reject the will of the voters. The prime minister’s office is expected to submit a tightly worded bill to Parliament as early as this week, and if all goes well May will begin a two-year, irreversible process of exit negotiations with the EU by the end of March. “There’s no going back,” David Davis, the British official assigned to oversee the withdrawal, told Parliament later on Tuesday. “The point of no return was June 23,” he said, referring to the date of the referendum. That is not going to stop some from trying. The Scottish National Party is likely to vote against the measure, and has vowed to submit 50 “serious and substantive” amendments in an effort to slow the process and, if possible, soften or reverse the outcome. But with the leader of the opposition Labour Party, Jeremy Corbyn, pledging not to stand in the way, and the Conservatives holding a majority in Parliament, May is widely expected to prevail. New York Times News Service

Asean

BusinessMirror

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Asean connectivity: Challenge for an integrated Asean community–Analysis Asean-EU Perspective

HENRY J. SCHUMACHER

T is crucial for the success of the Asean community to strengthen and build its intraregional connectivity. This will lead to more investments in business and industry toward a more inclusive region.

Asean hosting to lure trade, investments

The Philippines stands to benefit from hosting of Association of Southeast Asian Nations (Asean) Summit this year through increased trade and investments in the region and high economic growth in the next few years, said the country’s foremost economist.

European companies growing hot for Vietnam

Vietnam is the most important economic partner and the biggest trade partner of Poland in the Asean. After the establishment of the Asean Economic Community, Vietnam can be considered the gate to all Asean markets.

Business Asean Automotive Aftermarket expected to grow at a CAGR of 9.6 percent during 2016 to 2026

IN “Automotive Aftermarket: Asean Industry Analysis and Opportunity Assessment, 2016-2026”, poor road infrastructure and extended vehicle life have been identified as profitable factors for the growth of the automotive aftermarket in Asean.

RCEP as a positive signal for globalisation

The end of 2016 marked the second time Asean and its trading partners failed to meet the target to establish a Regional Comprehensive Economic Partnership (RCEP). The attention on the RCEP has been growing lately, and there is big hope it will be concluded by the end of 2017.

Asean GDP in 2017

The combined GDP of the ten member-countries is projected to rise to $2.6 trillion in 2017, from $2.5 trillion in 2016. That will be bigger than the respective economies of the United Kingdom, France and India—and twice the size of Australia.

Thailand to take lead in Asean community

AS the Asean community enters its second year, Thailand, as one of the founding countries of the bloc, is planning to spearhead various economic opportunities to benefit the region.

Pharmaceutical sector in Vietnam—outlook on the European Union Vietnam free-trade agreement

Vietnam has made great progress in the quality of the pharmaceutical and medical sector. By dedicating 5 percent to 6 percent of GDP to health-care expenses, Vietnam is among countries with the best outcomes in Asean.

The Asean automotive market and Europe’s growing involvement

The Asean automotive market is dominated by Japanese brands, accounting for over 80 percent of the market share. The rest of the market in Asean comprises of American, Korean and European brands.

Will the RCEP morph into another TPP?

The Trans-Pacific Partnership (TPP) provisions have been proposed in a number of other trade negotiations, including those on the RCEP, on the Trade in Services Agreement and at the World Trade Organization. It’s worthwhile looking at some of the TPP provisions, which have been proposed in the RCEP and their implications.

Editor: Max V. de Leon • Thursday, January 26, 2017 A9

Vietnam factories hum at full capacity despite Trump snub

ietnamese clothing maker NhaBe Garment Corp. had a lot riding on the Trans-Pacific Partnership (TPP). The supplier to brands, such as Calvin Klein, Michael Kors and Kenneth Cole, has seen its exports more than doubled since 2011 to $729 million last year —and it increased its factories twofold to 35, betting on a big drop in tariffs from Vietnam’s membership in the 12-nation trade pact. With a pen stroke, President Donald J. Trump killed the ambitious trade agreement, a deal that promised to deliver an estimated 8-percent boost to Vietnam’s GDP by 2030, according to the World Bank. Yet, that hasn’t dented enthusiasm among multinationals for the communist country, which was on track to be the top exporter of goods to the US last year among the Association of Southeast Asian Nations. “We have filled all the factories,” said NhaBe Managing Director Michael Laskau in charge of order, design and manufacturing. “I don’t expect our customers to leave us.” Trump’s incendiary trade rhetoric directed at China and his threat to impose 45-percent tariffs on Madein-China products remains a powerful incentive for companies to shift manufacturing to other countries, with Vietnam emerging as a strong contender. While TPP’s demise takes some of the shine off Vietnam, the country’s young and low-cost work force are magnets for international investors. “Vietnam will continue to attract foreign direct investment [FDI] in labor intensive firms, as well as those that want to capture the burgeoning domestic market,” said Trinh Nguyen, a senior economist at Natixis SA in Hong Kong. Vietnam plans to continue its reform process and will fulfill trade-agreement commitments, Ministry of Foreign Affairs Spokesman Le Hai Binh said in a statement on late Tuesday. The country has been enjoying a foreign investor-led economic boom

$15.8B The amount of Vietnam’s FDI last year, up 9 percent

for years as it transformed from mainly an exporter of agricultural commodities, such as rice and coffee, to a Southeast Asian manufacturing hub. Tainan Spinning Co., a textile company based in Taiwan that employs 4,500 workers in Vietnam, said in an e-mailed statement that the demise of TPP won’t affect its plans there. “Given the company’s strength and commitment, Tainan Spinning is considering further expansion in Vietnam in the second half this year,” it said.

China bashing

Few China alternatives can match Vietnam’s low wages that are about a third of its northern neighbor, as well as good access to ports, said Joseph Incalcaterra, Asia economist with HSBC Holdings Plc. in Hong Kong. “Vietnam still looks quite good,” he said. Companies that may need to look for China alternatives include Yue Yuen Industrial Holdings, a major supplier of shoes to brands, including Adidas AG and Nike Inc., according to Bloomberg Intelligence analyst Catherine Lim. Yue Yuen and textile maker Shenzhou International Group Holdings “may shift production to factories in countries, such as Vietnam and Indonesia, to mitigate the impact on customers” of US penalties against Chinese imports, Lim wrote in a December 14, 2016 report. Yue Yuen relies on Vietnam for more than 40 percent of its pro-

duction, according to a spokesman, thanks to its low salary costs, local government support and a skilled work force. “We don’t expect any material impact from TPP on our decision of Vietnam production line,” the spokesman said. There’s no question that TPP would have been a big win for Vietnam. Vietnam’s exports to the US climbed 15 percent to $38.5 billion last year, according to Vietnam Customs. Textiles and garments account for almost 19 percent of Vietnam’s exports. The TPP would have eliminated the 17-percent tariff on US imports of garments from Vietnam, Nguyen Xuan Huy, an analyst with CIMB Securities Vietnam, wrote in a report published on Monday. The TPP would have given Vietnambased garment makers “a major advantage in exporting their products to the US,” he wrote. Without the trade deal, “that advantage has evaporated.” Also, as Nguyen with Natixis pointed out, “Vietnam still does not have a free trade agreement with the US—a very important trade partner and the largest economy in the world.” TPP would have reduced tariffs in Vietnam’s key footwear and garment industries. US companies in Vietnam were disappointed by Trump’s move. “The president’s action to withdraw from the TPP is bad news for American and Vietnamese companies, investors, workers, farmers and consumers,” Adam Sitkoff, executive director of the American Chamber of Commerce in Hanoi, said in an emailed statement.

FDI boom

Still, there are signs that Vietnam

has already made the transition to the post-TPP era. Last year, despite the announcements by Trump and Democratic rivals Hillary Clinton and Bernie Sanders against the trade deal, Vietnam continued to attract FDI in record numbers. The country’s FDI hit a record last year, growing 9 percent to an estimated $15.8 billion. Manufacturing and processing accounted for the bulk of pledged foreign investment, led by two Korean projects: a $1.5-billion investment by LG Display Co. and a $550-million investment by LG Innotek Co. The impact of US withdrawal from the TPP on LG Display’s operations will be limited, the company said in an e-mailed statement on Wednesday. The decision to invest in Vietnam “was not purely based on a tariff benefit issue,” the company said. “Therefore, there will not be much change in our decision on investment in Vietnam or on our business strategy there.” As part of the TPP negotiations, Vietnam’s government agreed to accelerate reforms to state-owned enterprises. While the TPP is unlikely to proceed without the US, the government isn’t going to retreat from those investor-friendly reforms, according to Vu Tu Thanh, chief Vietnam representative of the US-Asean Business Council. That should help Vietnam and other Southeast Asian countries avoid suffering from a post-TPP investment letdown, he said. “I don’t think investment in the US will come at the expense of Asean,” he said. “There is enough money out there sloshing around.” Bloomberg News

In Bali, Trump’s planned six-star hotel and resort risks angering the gods

n the Indonesian resort island of Bali, building height is measured by coconut trees. Anything taller could anger the gods the Hindu locals believe inhabit the island. So plans to renovate a decades-old hotel overlooking a 16thcentury temple and turn it into a bigger six-star resort, complete with a tower and upgraded golf course, are causing some anxiety. It will be known as the Trump International Hotel and Tower Bali. Donald J. Trump’s company has paired with an Indonesian tycoon to build what they say will be the largest resort on the island. With construction targeted to start in early-2018, it risks making the new US president a lightning rod for local ire over the project even as he seeks to divorce himself from his sprawling business empire. “I would strongly recommend against any new developments that impact the temple,” said I Gusti Ngurah Sudiana, the local chief of Parisada Hindu Dharma Indonesia, the country’s peak Hindu organization. “These things are sensitive in Bali. The Balinese don’t tend to speak up, but these things related to the sacredness of the temple are very sensitive,

only the enforcement is too weak.’’ The Trump Organization says the hotel and tower will offer views of the Indian Ocean and Tanah Lot temple and bring “a new level” of luxury to Bali. The project cements ties between Trump’s family and MNC Group founder Hary Tanoesoedibjo, who was on the guest list for Trump’s inauguration in Washington, D.C., and has touted his friendship with Trump’s children. Tanoesoedibjo has his own political party in Indonesia. The renovated resort will be managed by Trump Hotels, a spokesman for the Trump Organization said by e-mail. It is one of two in the works under their partnership, which will cost MNC up to $1 billion. With the new hotel still in the design phase, locals say gossip about how it will look makes them uneasy. Some Hindu devotees worry about the references in promotional material to the tower. MNC has said its height is not yet determined. From the lobby of the current resort, guests can look out to Tanah Lot, a Unesco-listed World Heritage Site perched precariously on an offshore rock, said to have been built as a shrine by a traveler who founded a Hindu priesthood in Bali. While the majority of Indonesians are Muslim,

more than 80 percent of Balinese identify as Hindu.

Nearby farmers

Locals have also heard the hotel will be bigger and could require the purchase of nearby farmlands. Made Sumawa, ethnic head of the village that includes the hotel, said there is a standing offer from MNC to buy land within a certain perimeter of the existing Pan Pacific Nirwana Bali Resort. While parts of Bali are bustling with hotels, shops, bars and massage parlors, the current resort sits among rice paddies on the west of the island, with modest homes nearby. MNC Land Vice President Budi Rustanto said in a phone interview the resort area would be expanded from 106 to 140 hectares (346 acres), but he did not say how much extra land might need to be bought. Kadek Sudiasi, 42, has lived to the east of the resort for more than 40 years and says he won’t sell his paddy fields to MNC, no matter the price. “It’s the way of rich people to do whatever they want and to offer money to smooth the way for themselves,” he said, hunched over a recently harvested field to turn over mulch with his bare hands. “I

plan to buy more land to give to my children instead of selling. Money you can make again, but land is finite, let alone fertile land.” Tabanan regency, where the resort is located, is known as Bali’s rice depot due to the expanse of terraced paddy fields built into its hills. The locals use a system for irrigation and cooperative watersharing structure called subak that dates back to the 9th century, to ensure rice can be cultivated on both flat land and hillsides. Speaking at his residence in Jakarta earlier this month, Tanoesoedibjo said there had been issues with locals over the existing property before he bought it two years ago. “When they started the project in the 1990s, yeah, it’s because the development was too close to the temple, that’s what I heard,’’ he said. There is “now nothing to be worried about.” Nengah Santhi grows rice on a small plot near the hotel. In her 40s, her son works at the resort in customer service. She doesn’t particularly care about Trump’s political views, but she would like clarity on how much more land the renovated hotel will absorb. “When he comes to our island, then I will pay attention,” she said.

“If he asks me to sell my land then, of course, I will say no, this is my land, I grow my rice here and later my son will grow rice here.” The local Hindu group also has questions over plans for a new golf course, potentially with one designed by Phil Mickelson’s company. The eastern side of the current course surrounds a small temple set on black volcanic sand. Local regulations forbid buildings within a certain perimeter of temples. The rules vary according to the status of the sacred site.

Golf course

“A golf course is an open space, so according to government regulations, it’s in line,” said the Hindu association’s Sudiana of the current course. “But a golf course isn’t a forest and it isn’t nature so it conflicts with the philosophy of upholding the temple’s sacredness.” For some locals, the planned redevelopment creates mixed emotions. Tourism matters to Bali. While the statistics office doesn’t break the figures down, accommodation and food and beverages were the biggest component of its GDP in the third quarter, around 23 percent.

Still, I Gede Pasek Suardika, a member of Indonesia’s regional representative council and deputy chairman of the federal governmentaligned Hanura party, said there had been opposition to previous efforts to further develop the area. Tanoesoedibjo left Hanura after a failed bid in 2014 to become Indonesia’s vice president.

Prior backlash

“TO my knowledge, that area is already under greenbelt restrictions and can’t be freely developed because it received backlash from the locals previously, so what can be developed is only limited to what was already agreed on before,” Suardika said. Ida Bagus Wiratmaja, head of the local planning and development board, has concerns. “They must not exceed the height of a coconut tree, or a maximum of 15 meters,’’ he said, and “must pay attention to sanctuaries and places of worship.” Nirwana resort has submitted a request for a new permit to accommodate its proposed expansion, as the one issued in 1994 would no longer be valid, Wiratmaja said on Tuesday, adding his office has yet to approve the new permit. Bloomberg News

A10 Thursday, January 26, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Trump’s tirade war against China

N his first day in office, US President Donald J. Trump showed the world how he intends to follow through on his campaign promise to take a more aggressive stance against foreign competitors as part of his “America First” policy. With the stroke of a pen, he formally abandoned the 12-nation Trans-Pacific Partnership (TPP), the trade concept initiated by former President Barack Obama, and declared an end to an era of multinational trade pacts that defined global economics in modern times. Obama saw the TPP as a way of keeping countries, such as Japan, Brunei Darussalam, Singapore and Malaysia, out of China’s influence. All these countries have an export-led model of growth and his plan was to create a US-led free-trade zone that included all the major economies of the Pacific minus China. Trump, however, said junking the TPP would protect American workers against competition from low-wage countries that are parties to the deal. Trump told a meeting of union leaders at the White House on Monday, “we’re going to stop the ridiculous trade deals that have taken everybody out of our country and taken companies out of our country, and it’s going to be reversed.” He added, “From now on, the United States would sign trade deals only with individual allies. I think you’re going to have a lot of companies come back to our country.” As Trump upended America’s traditional trade policy, observers are saying he seems intent on starting a global trade war when he told business executives at the White House that he would punish companies that shut factories in the US and moved jobs overseas by imposing a “very major” border tax. “The President is slamming the door on American corporations wishing to do business abroad,” CNBC’s Jim Cramer said. “I would tell you that from now on if you’re looking at a company and you think that they can cut costs by moving offshore and you put that in your 2017, 2018 numbers, think again, that’s over.” What’s more worrying, though, is the fact that Trump has threatened to slap high tariffs on Chinese imports, as he warned multinational companies, like Carrier and Toyota, he would impose a hefty border tax on anything they manufacture in Mexican factories for sale in the US. Such steps could quickly degenerate into a global trade war. Chinese and Mexican officials have said they would retaliate if Trump imposed barriers to their exports. The question now is: Which countries will be hurt the most by Trump’s protectionist policy that could lead to a global trade war? Experts say the rule of thumb is that the country with a trade surplus—in this case, China—has more to lose in a trade war. If Trump decides to slap China with punitive measures, Beijing will feel the pain, but it has effective countermeasure ammunitions. China remains the largest financier of American debt. If the People’s Bank of China decides to sell down its share of US Treasuries, the value of T-bills would fall, leading to a dive in the global economy. That would definitely hurt America. China also has the option of devaluing the yuan, which would weaken export competitors and boost its status as a global producer of goods and commodities. These scenarios would have an inevitable adverse effect on the Philippine economy. We hope that Trump’s “tirade war” against China will not turn into a globally disastrous “trade war”. Since 2005

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Trump-hysteria John Mangun

OUTSIDE THE BOX

N June 16, 2015, Donald J. Trump announced his intention to run for the presidency of the United States. There are those who claim that his assent to the presidency epitomizes, “First, they ignore you, then they laugh at you, then they fight you, then you win”. That may be somewhat accurate. But, then again, that quote is also attributed to Mahatma Gandhi, which is totally “fake news”. Gandhi never said nor wrote anything remotely along those lines. Welcome to 2017. If you cannot view the hysteria surrounding the Trump candidacy/ election/ presidency with irony, then you might be taking things way too seriously. Or more probably, your guy —or lady—lost the election. Before you hit the “send” button telling me how the world and the Philippines desperately needed the election of Hillary Clinton, it might be well to remember that the Chinese invaded and occupied the Panatag Shoal in the middle of Clinton’s tenure as US Secretary of State. At

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country are unduly burdening and restricting the foreign trade of the US” can “proclaim such modifications of existing duties and other import restrictions”. The greater reality that is causing the global temper tantrums is found again from Roosevelt: “We shun political commitments, which might entangle us in foreign wars. We are not isolationists, except insofar as we seek to isolate ourselves completely from war”. War in the 21st century is as much economic as military. No longer can Mexico absolutely rely on 30 percent of its economy from exports to the US. Regional problems and disputes are going to have to be solved locally, not through US military intervention. The era of “Pax Americana,” both economically and militarily, may be coming to an end. Trump: “We are approaching the end of an era where we fought other nations’ wars and paid other nations’ bills”. That is the “Trump Doctrine”. Get used to it. 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.

Diversionary tactics, and the divide-and-rule policy

✝ Ambassador Antonio L. Cabangon Chua Publisher

the time, the official statement from Washington, D.C., was “She [Secretary Clinton] voiced concern about Scarborough Shoal, repeating that Washington does not take sides on competing sovereignty claims there”. Further, in a speech to Goldman Sachs in October 2013, Clinton said, “You can’t hold that against them [China]. They have the right to assert themselves”. But politics is politics. Former President Bill Clinton called Trump’s slogan—“Make America Great Again”—racist. Except in a 2008

television ad for his wife’s presidential campaign against Barack Obama, he said: “It’s time for another comeback, time to make America great again”. You really want to listen to any of these people without laughing? But people think we are facing perilous times because of dark statements like this: “The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little”. Except that is what Franklin D. Roosevelt said during his second inaugural address. Trump echoed that with, “For too long, a small group in our nation’s capital has reaped the rewards of government while the people have borne the cost”. Global trade, though, is a critical issue with grave worries that Trump will enforce protectionist policies, because of his “I am all for free trade, but it’s got to be fair”. Again, interestingly, Roosevelt’s Reciprocal Tariff Act of 1934, in reaction to disastrous high US tariff policies under the Smoot–Hawley Tariff Act, said, “The President, whenever he finds as a fact that any existing duties or other import restrictions of the United States or any foreign

T looks like the President’s men are grappling with the issue of controlling the damage wrought by recent controversies that have rocked Malacañang and in finding ways to extricate their boss from his defensive box.

Now on the “offense is the best defense” mode, Justice Secretary Vitaliano N. Aguirre II dismissed these hideous events as nothing but an attempt to destabilize the present dispensation. Of these controversies, nothing can be more appalling than the murder of South Korean businessman Jee Ick-joo right inside the heretofore hallowed grounds of Camp Crame. That the crime was perpetrated by rogue elements of the Philippine National Police (PNP) in kidnapfor-ransom activities, while using the war on drugs as a cover, makes it even more nauseating. No sooner had the news exploded in traditional and social media, President Duterte visited the widowed families of the 44 slain members of the PNP’s elite unit, the Special Action Force (SAF), who were “massacred” in an encounter with the Moro Islamic Liberation Force (MILF), the Bangsamoro Islamic Freedom

Fighters (BIFF) and other Muslim bandits’ groups in Mamasapano, Maguindanao. Codenamed Oplan Exodus, the operation was intended to capture or kill wanted Malaysian terrorist and bomb-maker Zulkifli Abdhir and other Malaysian terrorists or high-ranking members of the BIFF. The operation was launched in the wee hours of the morning of January 25 last year. It led to the death of 44 SAF operatives, 18 from the MILF and the BIFF, and five civilians, and that of Abdhir as confirmed by the US Federal Bureau of Investigation. The mission was declared a success in having neutralized Abdhir, but came at a heavy price. The subsequent firefight was believed to be a tactical victory for the MILF forces against the PNP SAF. Duterte wasted no time in hitting former President Benigno S. Aquino III, demanding for him to come clean and explain his part in

the unfortunate encounter. But the Mamasapano episode and the South Korean murder are miles apart in magnitude and complexion. The former was a legitimate operation, only tainted by operational lapses by ground operatives, while the latter was a blatant crime committed by the police, whom Duterte virtually clothed with immunity by declaring his ironclad support for them in the name of the war on drugs. This early, Aguirre is already casting doubts on the veracity of the investigation carried out by the police, saying the evidence against the main suspect, policeman Ricky Sta. Isabel, may have been planted. I view the government’s posturing as a diversionary tactic that, along with dividing the nation, is defining the Duterte governance. The President is seen here and in the international community as abhorring dissent. He could not let the day pass by without cursing and labeling those who criticize him as “yellowed”, since yellow is the color associated with the Liberal Party now led by Vice President Maria Leonor G. Robredo. But if Duterte raised the issue of command responsibility in Aquino’s role in Mamasapano, shouldn’t he accept the same burden for the Korean’s murder in Camp Crame? The Korean’s murder couldn’t be just swept under the rug. The international community is keenly watching for developments in the

case. This is one issue that the Duterte administration is hard put to sanitize. At stake here is how the government can convince foreign businessmen that the country is a safe place to park their funds in, without being harassed and made to cough up millions in what are considered police-led kidnap-for-ransom activities. How the government can convince them that the State can protect them is something that diverting the issue cannot mask. South Korea is currently a major trading partner of the Philippines. It has been one of the top senders of visitors to the country, with more than half a million arrivals yearly. It also ranks sixth among the Philippines’s bilateral trade partners. South Korea has also committed more investments and has even vowed to help perk up our country’s investment climate, most especially in the utilization of our naturalresource endowments. Philippine economic diplomacy could also encourage more Korean investments, but these have to be paved with sound infrastructure and improved investment climate in the country. With the horrendous murder of one of its citizens here, all these enhancements could be put on hold. A dead rat, no matter how its corpse is kept hidden, would lead us to where it is by its overwhelming stench.

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

Opinion BusinessMirror

opinion@businessmirror.com.ph

Philippine foreign policy: From Following Jesus mendicancy to independence? Msgr. Sabino A. Vengco Jr.

Alálaong Bagá

Ariel Nepomuceno

DECISION TIME

uring the 1951 University of the Philippines graduation ceremonies, eminent statesman, lawyer and poet Claro M. Recto delivered a speech essentially characterizing our foreign policy as one dependent on powerful foreign powers, particularly the United States. He eloquently lambasted the country’s willingness to be used by the US for its own military and economic interests and, in the process, losing its identity, thereby earning the disrespect of other nations. This gripping speech, entitled “Our Mendicant Foreign Policy,” has become a must read for politicians, historians, scholars and students who are all participants in the quest for the Philippines to achieve the dream of true independence. A little more than six months into his term, President Duterte has been capturing the imagination of the entire world for his open tirades and criticisms of the US’s treatment of the Philippines in the areas of defense, economic cooperation and, likewise, echoed the US’s interference in our domestic affairs. Particularly irked by President Barack Obama’s comments about the need to observe human rights in his antidrug and crime campaign, our President declared his plans of recalibrating the country’s traditional alliance with the US in favor of China and, currently, Russia. While this was the main flavor of this administration’s evolving foreign policy, many observed the slight change in his views when Donald J. Trump was elected and sworn into office a few days ago.

New hope with Trump

MalacaÑang recently praised Trump’s desire to build a mutually beneficial relationship with its long-standing allies in the international community. The difference, as pointed out by the Palace, is that the US, under a Trump presidency, will respect the Philippines’s right to protect its self-interest and to carve an independent foreign policy based on principles of nationalism and patriotism. Presumably, self-interest would mean seeking stronger partnerships with China, a comprehensive review of the South China Sea territorial dispute strategy, procurement of arms and defense equipment from other world powers and limiting joint military exercises with the US. During his visit to Beijng, 13 bilateral cooperation agreements were signed by the President and his counterpart Xi Jinping, after his announcement of separation from the US. This was, however, clarified by Finance Secretary Carlos G. Dominguez III by a statement that the government’s core intention was to do more regional economic integration, thus visits to Asian countries have been prioritized compared to others.

Effects on Filipinos

All these developments manifest a big shift in the way our foreign policy is unfolding. It will surely bring about some benefits because broadening the range of international

relationships would diversify the options of the Philippines in terms of partnering with countries that can provide investments, economic assistance, humanitarian aid and military strength. However, a good, objective assessment of our international alliances should be done. The US is and will still be an important player at this stage. The negative implications of a Trump presidency cannot be disregarded. First, his economic protectionist policy of “America for Americans” may affect our business-process outsourcing industry and prevent our products from competing in their market due to high tariffs. Second, Asian factories can be closed down and relocated back to the US. Third, Filipino immigrants will experience the horrors of growing racial prejudice since Trump’s win has been predicated on dislike for foreigners who compete with middle-class Americans for jobs. One must not forget that during his campaign, Trump named the Philippines as a terrorist nation from which the US is letting “animals in!” Trump’s latest tirades against China by rejecting the One China policy due to the economic disadvantages that the latter has brought to the US’s global trading position have caused shock waves to the diplomatic world. Equally alarming was his disinterest in fortifying defense cooperation with Asean in the midst of escalating security issues relating to the South China Sea. Worst of all, his growing friendship with Russia and its intelligence agencies have created a big rift between the White House and the Central Intelligence Agency. Such instability in his policy directions should be taken seriously as we begin to chart our way forward in the realm of international relations. Today, Claro M. Recto’s speech still relevantly resonates: “Sentimentalism and emotionalism should not play a part in international relations. It is folly to expect any nation to ever sacrifice its welfare and security to pure idealism or to sentimental attachments. As Filipinos, we must look out for ourselves, because no one else will. That is the essence of independence.” For comments and suggestions, e-mail arielnepo.businessmirror@gmail.com.

Proving fraud Atty. Ayesha Hania B. Guiling-Matanog

Tax Law for Business

ased on the National Internal Revenue Code of 1997, the Bureau of Internal Revenue (BIR) has a period of three years after the last day prescribed by law for the filing of the return to assess internal-revenue taxes. Beyond this period, any assessment issued will be considered invalid. The exception is when there is a finding of fraud or falsity in the return filed or when no return was filed, in which case the applicable prescriptive period is 10 years. It is, therefore, not unusual that when there is failure to make an assessment within the normal three-

year prescriptive period, the BIR would attribute a finding of fraud, falsity or nonfiling as justification

fter reflecting on Jesus as the Great Light for all who live in darkness, we shall now more intimately know Him as the teacher and lawgiver of the Kingdom of God He proclaims. He enumerates in the Beatitudes (Matthew 5:1-12) the rules of true fulfillment characteristic of those who follow him in God’s reign.

‘Pinagpala’ People in painful situations are called “blessed” by Jesus. Just what is this blessedness? Its customary Tagalog translation as mapalad is ill conceived. It would connote good luck or fortune, as it is based on palad (palm of the hand—guhit ng palad or kapalaran) that tells of one’s destiny. This sort of fatalism is behind many people’s propensity for gambling and games of luck due to the belief that there are ineluctable developments in life: “Aking kapalaran di ko man hanapin, papanhik sa bahay kung talagang akin [My fate will come to me even if I do not look for it].” This is echoed by the “bilog ang mundo [The

world is round]” maxim, which guarantees some automatic changes in one’s situation that absolves one of ultimate responsibility. The world of fate and suwerte (good luck) is definitely not what Jesus is talking about in the Beatitudes. He is not offering some lottery alternative to the kapus- or sawing-palad (unfortunate). God’s blessing is not a matter of “palarin sana [having good luck],” but of divine intentionality and universal plan of salvation. It is grace, pagpapala. It speaks of the person being gifted out of divine goodness and mercy: pinagpala. In turn, it implies personal receptivity and responsibility in connection with the offer:

Thursday, January 26, 2017 A11

“Bigay ma’y mabuti’t ’di-pangatawanan, marahil ay hindi tamuhin at kamtan [A gift however good but not welcomed will not benefit anyone].”

Jesus the blessed one

IF ever there is a human being blessed and filled with divine love and goodness, it is Jesus. He is the icon or sacrament of the love of God here on Earth; He personifies and manifests the fullness of the reign of God. While here in his humanity He was totally in union with the Father and is now glorified with the Father, even as He was the poor in spirit, the one who mourned, the meek, the one who hungered and thirsted for justice, the merciful, the clean of heart, the peacemaker, the one persecuted for the sake of righteousness, the reviled one. The Beatitudes are a teaching not on the moral but rather on the mystical plane. By gazing on and contemplating the face of Jesus, as Saint Pope John Paul II reminded us at the beginning of the third millennium, we discover and understand who is happy and blessed and why. Identification with Jesus, imitation of Him, following His footsteps is the way to the Kingdom of God. Jesus teaches us as our model. How shall we learn meekness? He says, “Learn from me, for I am meek and

humble of heart” (Matthew 11:29). Those who enter into communion with Jesus as God’s faithful Son are already blessed and share in His life and glory. That is not a reward still to come, but happiness and fulfillment already now, even as we journey toward the eternal order of life. Alálaong bagá, the nine beatitudes are a coherent and progressive summary of the gospel of Jesus. Taken together, they present at His inaugural discourse “on the mount” the life model for those who are decided to imitate Him. God is the sure refuge of the poor, and this humble condition means availability and openness to God’s grace. The poor, the meek, the humble, the pure of heart have the right disposition in seeking the reign of God and His righteousness (Matthew 6:33), with commitment notwithstanding sufferings and persecution. The merciful and the peacemakers are disciples who know how to treat others with real charity, for all shall be judged according to what they have done to others (Matthew 25:31-46). Followers of Jesus can, indeed, be glad and rejoice. Join me in meditating on the Word of God every Sunday, 5 to 6 a.m. on dwIZ 882, or by audio-streaming on www.dwiz882.com.

Mighty doing laudable efforts to fight illicit trade

“This situation is unusual and highly suspicious for MC to be at the receiving end, because our operation is transparent and closely monitored by revenue authorities from sourcing of raw materials to manufacturing and withdrawals of cigarettes,” said retired regional court judge Oscar P. Barrientos, MC executive vice president and spokesman. Barrientos was reacting to a headline story in the business section of a newspaper (not the BusinessMirror) that “the BIR [Bureau of Internal Revenue] is investigating homegrown cigarette manufacturer Mighty Corp. for allegedly using fake tax stamps on its products.” “In fact,” he said, “our company’s operation is the only one monitored by close-circuit cameras required by the BIR and it’s also on record that MC has spearheaded the campaign all over the country against the proliferation of fake cigarettes using fake stamps.” Barrientos said as of Wednesday MC has not received any notice of investigation by the BIR, and if ever there will be, “we are prepared for it

as our records are always open for scrutiny by the BIR.” “We are hoping that if ever this is done, the BIR should include in its investigation not only local manufacturers, but also multinational companies and their local partners who are known for importing large quantities of raw materials without paying the correct taxes to the prejudice of our local farmers,” Barrientos said. “It’s on record that as early as two years ago, Mighty has coordinated with the BIR, Bureau of Customs, the police and the National Bureau of Investigation in the seizure of fake Mighty cigarettes and other brands and the arrest and indictment of persons involved in the smuggling, manufacturing and marketing of contraband cigarettes,” Barrientos added. According to Barrientos, Mighty has been subjected to unfair competition by its rivals after its products, known for their smooth and superior blending, started eating a large share of their market in the low-priced category once

dominated by multinational rivals who remit abroad a large part of their income to the prejudice of the Philippine economy. Two years ago, a ranking member of Congress had requested then-Customs Commission John P. Sevilla to look into the highly irregular release of 500 containers of raw materials for the manufacturing of cigarettes from the customs zone in Manila. The investigation, involving a multinational company, was never heard of again. Meanwhile, former National Economic and Development Authority Director General Romulo Neri debunked arguments that a two-tier excise tax system proposed under House Bill 4144 is an antihealth measure. Pro-health advocates are arguing against the proposed amendment noting that smokers’ projected downshifting will negatively impact the bill’s intention to curb smoking prevalence. According to Neri, a noted economist, “while some downshifting from premium brands to cheaper ones is expected to happen under a nonunitary tax system, this is limited in quantity and, therefore, has little detrimental effect on overall health. Downshifting to lower priced brands is an absolute economic right of consumers.” He added that pro-health advocates might also be missing the point that a unitary tax system, likewise, encourages consumers of cheaper brands to upshift to premium ones, since the resulting marginal difference in price will be negligible, especially when sold by tingi (per piece). House Bill (HB) 4144, authored

for the application of the 10-year prescriptive period. This was the case in one assessment case, which was decided in CTA EB 1338. In said case, the BIR assessed the taxpayer for deficiency internalrevenue taxes beyond the three-year prescriptive period. The BIR claimed that the 10-year prescriptive period applied because the taxpayer failed to file the required returns. It was, however, proven that the taxpayer filed the returns. Nonetheless, a division of the tax court still upheld the applicability of the 10-year prescriptive period, on the ground that there was fraud in the filing of the returns. The tax court en banc, in reversing the decision of its division, ruled that it was erroneous to apply the 10-year prescription because of fraud.

As a rule, assessments made by the BIR are presumed to be correct and valid. The taxpayer bears the burden of proving the illegality of the assessment. The taxpayer must prove not only that the commissioner of internal revenue (CIR) is wrong but that the taxpayer is right. However, in this case, the court reiterated the principle that, while it is true that the burden of proof is on the taxpayer contesting the validity, the same does not apply when there are allegations of fraud. In civil tax-fraud cases, the burden of proof is always on the CIR to prove that the taxpayer committed fraud intentionally. The court reminded that fraud is never presumed and that it must be proved. The court said fraud is a state of mind; its presence can only

be determined by the attendant circumstances. As such, the intentional acts to deceive and deprive the government of correct taxes must not only be specifically alleged but must be proven accordingly. The court also found erroneous the use of preponderant evidence to prove fraud. To prove the existence of fraud, the degree of proof required is clear and convincing evidence, mere preponderance of evidence not being adequate. Thus, the existence of proof must not be merely alleged and speculated upon. The court further stressed that in civil tax-fraud cases, the burden of proof is always on the CIR to prove that the taxpayer committed fraud intentionally. Finally, it is important to

Cecilio T. Arillo

database

IGHTY Corp. (MC), the country’s oldest cigarette manufacturer effectively fighting competition against a monopolistic multinational, on Wednesday found itself strangely at the receiving end despite laudable efforts spearheading the campaign against smuggling, manufacturing and marketing of fake cigarettes and fake stamps.

by Party-list Rep. Eugene Michael de Vera of ABS Partylist, proposes a two-tier tax system, nonpremium brands at P32 per pack and premium brands at P36 per pack plus an annual increase of 5 percent on these rates. Neri said ensuring the fairness of a tax system is a paramount social goal, pointing out that administrative ease of collection should not be an excuse for enacting a regressive tax system that will result by imposing a unitary specific tax. “The claim of using tobacco taxes to benefit the health of the poor is a tenuous argument. The poor will immediately feel the impact of the high tobacco tax draining their pocket while the benefit of government spending on their health is a highly uncertain future event. If the tobacco tax revenue is spent in general health services and not targeted directly, the poor smoker may end up subsidizing the health care of nonsmokers, making the situation even worse for the poor smoker,” Neri concluded. According to earlier reports, lawmakers, particularly Ways and Means Committee Chairman Rep. Dakila Carlo E. Cua of the Lone District of Quirino noted that the higher prices proposed in HB 4144 is more discouraging to the smoking public than the original schedule of P30. He also said that among the main reasons in approving HB 4144 were to instill offsetting measures to the foreseen effects of the Duterte administration’s main objective to lower personal income tax to ease overburdened taxpayers.

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

determine the existence of fraud not only because it merits the applicability of the 10-year prescriptive period. If fraud is found to exist, instead of the normal 25-percent surcharge, a higher rate of 50 percent of the deficiency tax is imposable. The author is a junior associate of Du-Baladad and Associates Law Offices (BDB Law), a memberfirm of WTS Global. The article is for general information only and is not intended, nor should be construed as a substitute for tax, legal or financial advice on any specific matter. Applicability of this article to any actual or particular tax or legal issue should be supported, therefore, by a professional study or advice. If you have any comments or questions concerning the article, you may e-mail the author at ayesha.matanog@bdblaw.com.ph or call 4032001 local 170.

2nd Front Page BusinessMirror

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Thursday, January 26, 2017

Chef: 80% of salt in PHL market industrial grade By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

ADRID—A popular Filipino chef has raised the alarm on nonfoodgrade salt being sold commercially in the Philippine market. Well known for his creative takes on Filipino cuisine, Chef Myke “Tatung” Sarthou (Agos) told the BusinessMirror as much as 80 percent of the salt being sold in supermarkets and wet markets are industrial grade imported from China and Australia. “If you notice, this salt doesn’t melt even when you cook it, because it’s meant for soap, and to make other industrial products [e.g., dye setting, plastics, polyester, glass, etc.]. So, even if you keep adding it to your dish, it has no effect.” Sarthou was to speak at the ongoing Asisa Madrid Fusión 2017 (AMF 2017) on “What Is Lost Is Found: Rediscovering Pre-Spanish Philippine Cuisine” on Tuesday (Wednesday in Manila). According to a presentation by Pacific Farms Inc. in 2009, the annual salt requirements of the Philippines reached 590,000 metric tons (MT), of which 400,000 MT were imports from Australia and 22,000 MT were from China. The data, however, did not make a distinction between food-grade and industrial-grade salt. The rest of the demand was supplied by local producers, like Pacific Farms. Sarthou blames much of this large-scale importation of industrial-grade salt on the lack of local supply. Also, a little known law, called Republic Act 8172 or An Act Promoting Salt Iodization Nationwide, otherwise known as the Asin law, signed in 2005, discourages the improvement of the natural-salt industry by prohibiting the commercial sale of natural salt, unless it’s iodized. The law was created to help eliminate the causes of goiter and other thyroid problems due to iodine deficiency. What’s more, he said, the act of purifying salt, and then iodizing it, eliminates other minerals, which

would otherwise be beneficial to a person’s health. “We import a lot of salt, because for one, the local supply cannot keep up with the demand. But it also makes it a criminal act to sell natural salt in the market,” he stressed. While there are a few natural-salt retailers that sell openly in specialty weekend markets or organic markets across the Metro, Sarthou said they do so with a lot of risk. “If they are caught, they will have a problem,” he said. Under the law, those caught selling noniodized salt are liable to get their business permits revoked and be fined anywhere from P1,000 to P100,000. Even local restaurants are required to serve only iodized salt. Asked what agency he could turn to to help get the Asin law revised or repealed, “I really don’t know, because I already asked the Department of Agriculture and to them, salt is not considered an agriculture product.” (Under the said law, “the Department of Environment and Natural Resources and other appropriate government agencies shall identify areas that are suitable for use as salt farms, with the purpose of protecting such areas from environmental risks to ensure sustainability of iodized salt production”.) Salt-making is a dying industry in the Philippines, with only few commercial producers, while the rest are relegated to the likes of old women still boiling seawater until only the salt remains. In places like Guimaras, for instance, the salt is boiled with gata (coconut milk), then formed into blocks called tultul (or dukdok in Capiz). Sarthou is the third Filipino chef who will be speaking to about 1,000 participants of the AMF 2017, following in the footsteps of Chefs Mar-

The Department of Tourism (DOT) on Tuesday enjoined the participants of the ongoing Asisa Madrid Fusion 2017 to support the third edition of the Madrid Fusión Manila (MFM) from April 6 to 8 at the SMX Convention Center in Pasay City. From left are previous MFM presenters Chefs Fernando Aracama (Aracama, Manila); Jay Gamboa (Cirkulo, Makati); Mario Sandoval (Coque, Spain); Elena Arzak (Arzak, Spain); Andoni Luis Aduriz (Mugaritz, Spain); Madrid Fusion Director Lourdes Plana; Chef Pedro Subijana (Akelare, Spain), who will be speaking at this year’s event; past presenter Chef Myke “Tatung” Sarthou (Alab, Manila); and DOT Director for Market Development Verna Esmeralda Buensuceso. STELLA ARNALDO

garita Fores (Cibo, Lusso) and Myrna Segismundo (Restaurant 9501). During his presentation, he pointed out the importance of using salt in Filipino dishes. This includes fermenting seafood to make bagoong, drying fish and processing tinapa. He said, however, the profileration of nonfood-grade salt impacts on the small makers of bagoong and tinapa, basically cottage industries still in the Philippines. Using industrial-grade salt in these food pro-

cesses lowers the quality of these traditional food products, making them less palatable to consumers. Sarthou also championed the cause of Filipino-Muslim cuisine by showing a video of how traditional dishes in Islamic Mindanao areas are created. Thereafter, he made a live demonstration, cooking a Tausug-inspired dish using palapa (burnt coconut meat) and sea urchin, with a dash of native vinegar, and topped with shredded green mangoes.

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Punish corrupt govt workers, Neda says By Cai U. Ordinario

@cuo_bm

espite the decline in the Philippines’s corruption perception ranking, the impact on the country’s foreign direct investments (FDI) is uncertain, according to the National Economic and Development Authority (Neda). The Philippines, while retaining a score of 35 out of 100, has slipped six notches to 101st in Transparency International’s (TI) 2016 Corruption Perception Index (CPI), from 95th in 2015. “Transparency International puts the Philippine story in the ‘too early to tell’ category, and I believe the same can be said about the effects on FDI—it’s too early to tell,” Neda Undersecretar y Adoracion M. Navarro said. Nonetheless, Navarro said the government must monitor corruption in agencies, as well as investigate and prosecute corrupt policemen. She also said the 2017-2022 Philippine Development Plan (PDP) will help address the international community’s corruption fears through a chapter on swift and fair administration of justice and another one dealing with public order and security. “We hope to change these perceptions for the better when we come out with the PDP. As you know this is the blueprint of what government will do under the leadership of President Rodrigo Roa Duterte,” Neda Undersecretary Rosemarie G. Edillon told the BusinessMirror. TI said that, while the Philippines’s score was unchanged from last year, the country was placed under the “too soon to tell” category, which included countries that experienced major change in their democracies in 2016. O ne p a r t ic u l a r c h a n ge i s the rise of populist politicians, which TI fear could worsen cor-

ruption and undermine democracy. (See related story on A8.) This, TI said, could have been due to people being “fed up” with governments that failed to tackle corruption. The promise of change made by populist politicians, it said, won the votes of the majority in these countries. “President Duterte’s dramatic rise to power in the Philippines made extensive use of anticorruption rhetoric. Yet, the impact of death squads, attacks on media and violent intimidation to the detriment of democracy and democratic institutions is yet to be seen in 2017,” TI said. The country shared 101st place with six other countries—Gabon, Niger, Peru, Thailand, Timor-Leste, and Trinidad and Tobago. In the Asia Pacific, the majority of countries sat on the bottom half of the CPI 2016, with 19 out of 30 countries in the region scored 40 or less out of 100. “Poor performance can be attributed to unaccountable governments, lack of oversight, insecurity and shrinking space for civil society, pushing anticorruption action to the margins in those countries. High-profile corruption scandals, in addition to everyday corruption issues, continue to undermine public trust in government, the benefits of democracy and the rule of law,” TI said. Globally, the report stated that 69 percent of the 176 countries on the CPI 2016 scored below 50, based on a scale from 0 (perceived to be highly corrupt) to 100 (perceived to be very clean). It exposed how massive and pervasive public-sector corruption is around the world. This year TI said, more countries declined in the index than improved, showing the need for “urgent action.” TI said anticorruption laws are not sufficient to address corruption issues, and lack of transparency and accountability in the world.

President Duterte’s dramatic rise to power in the Philippines made extensive use of anticorruption rhetoric. Yet, the impact of death squads, attacks on media and violent intimidation to the detriment of democracy and democratic institutions is yet to be seen in 2017.” —Transparency International

Ceza denies issuing license to Lam’s Clark operations

he Cagayan Economic Zone Authority (Ceza), the operator of Cagayan Special Economic Zone and Freeport, said it has not issued a license to Jack Lam’s online casino operations in Clark Freeport. Ceza Administrator and CEO Jose Mari Ponce said the agency had never issued a license to Lam to operate his online casinos, or support his service company in Clark Freeport. “Ceza does not have an authority over operations in Clark, to begin with,” Ponce said in a statement to shed light on the Senate investigation into Lam’s online casino operations in Clark and Fort Ilocandia. The Senate started an investigation into Lam’s online casino operations following the arrest of over 1,300 foreign nationals reportedly working in Lam’s casino in November 2016. “Ceza has not issued an interactive gaming license nor has accredited a company named Next Games Outsourcing Inc. [NGOI],” Ponce said. Ponce said while NGOI signified its

intent to get a license from Ceza in 2014, such application has never officially reached Ceza. The company is said to be operating in Clark and Fort Ilocandia, over which Ceza has no authority. He said no Ceza Working Visa (CWV) had been issued to any foreign national working in any company at Clark Freeport. “Since the arrest of over 1,300 foreign nationals from Mr. Lam’s casino in November 2016, a few of whom were said to be CWV-holders, Ceza has not only done its own investigations on the matters at hand but has also worked more closely with the Bureau of Immigration [BI] and other government agencies that have been Ceza’s partners in ensuring the proper compliance and regulation of expatriates within its jurisdiction,” he said. “Right after having been informed of the arrests of these expats in November 2016, we have done our own investigation. Basing from the list given to us by the BI in December 2016, we have Continued on A2