A sisterly ‘no’ to Donald Trump By Frank Bruni | New York Times News Service
O
Victor J. Blue/NYT
n his first full day in office, our new president harangued the National Park Service about more flattering inauguration photos and preened in front of a memorial to real American heroes, crowing about how often he’s
been on the cover of Time magazine. »E4
media partner of the year
BusinessMirror
United nations
2015 environmental Media Award leadership award 2008
www.businessmirror.com.ph
A broader look at today’s business n
Monday, January 30, 2017 Vol. 12 No. 110
CONGRESSIONAL PROBE ON FAKE TAX STAMPS LOOMS
Debate on cigarette tax measure heats up A
major business group asked the Senate on Sunday to junk House Bill (HB) 4144, which seeks to reimpose the two-tier taxation for cigarettes, after its main backer in the House was ordered investigated by the Bureau of Internal Revenue (BIR) for allegedly using fake tax stamps.
inside
This developed as the debate on whether a unitary tax system for cigarettes is better than the proposed two-tier scheme among See “Debate,” A2
BMReports
Fintech companies could give billions of people more banking options
PPPs in a low- or high-trust society PPP Lead Alberto C. Agra
o we live in a high- or low-trust society? How will public-private partnerships (PPPs) operate in such a society? How does trust or lack thereof shape a PPP policy or project? The vision embodied in AmBisyon 2040 states that, “By 2040, the Philippines shall be a prosperous, predominantly middle-class society where no one is poor. Our people will enjoy long and healthy lives, are smart and innovative, and will live in a high-trust society.” This statement acknowledges the reality that Filipinos do not currently live in a high-trust society, and that it may take 23 more years before we live in such a society. Continued on A15
Toyota’s appeal: Go slow on hiking car excise taxes By Catherine N. Pillas
monday morning
T
e1
Miss universe most likely honda
An early-morning scene at a fishing village on the Agusan River in the eastern part of Mindanao. Samideleon | Dreamstime.com
Investing in rivers can help PHL bag ‘First World’ status
Cr-z:
Fabulous
By Jonathan L. Mayuga @jonlmayuga
Volkswagen’s life laudable
d1
T
Part One
HE proper utilization of the country’s rivers and its raw water supply, a major economic resource in the Philippines,
PESO exchange rates n US 49.6950
can provide the much-needed boost to help the country sustain growth and achieve the status of a First World economy, the country’s top environment official said. Citing the case of Singapore, Secretary Regina Paz L. Lopez of the Department of Environment
business news source of the year
P25.00 nationwide | 5 sections 32 pages | 7 days a week
HB 4144 D The bill that seeks to put in place a two-tier taxation system for cigarettes
2016 ejap journalism awards
and Natural Resources (Denr) said properly managing the country’s rivers is the key to sustaining the country’s growth and development. The key to Singapore’s phenomenal economic growth, she said, was the cleaning of the Singapore Continued on A2
@c_pillas29
oyota Motor Philippines Corp. (TMPC), the country’s leading auto brand and the current market leader, urged the government to lower its proposed excise-tax rates for all car segments. As the Department of Finance (DOF) pushes its proposed comprehensive tax-reform package in Congress, the TMPC urged the government to consider the local auto industry’s concerns. “It’s ok [for taxes] to come from all segments, but [increase should be] tempered, so it doesn’t affect sales,” TMPC Vice Chairman Alfred Ty told reporters in an interview recently. “The looming excise tax is an issue that we have to be aware of. How bullish manufacturers will be depends on regulations like those,” Ty added. Even with lower taxes on vehicles, priced at P600,000 or below, Ty said there will be a “significant impact” on the auto industry as a whole, even if one
price segment is hit. “ T he i ndu s t r y g re w not just because of all the volume sellers. Even the medium market has contributed to that,” he added. Targeting the luxury segment, or those selling above P2.1 million, won’t do much to help the DOF achieve its twin objectives of easing traffic congestion and beefing up government revenues, as very few high-end units are sold annually. Ty said the DOF has expressed its willingness to listen to the proposal of local automakers. The Chamber of Automotive Manufacturers in the Philippines Inc. (Campi) is slated to come up its own study on the impact of the impact of the excise-tax hike soon. The plan to increase excise taxes on vehicles is dampening the sales outlook of the industry for 2017. The passage of the measure may also make it difficult for the auto industry to hit its goal of selling 500,000 units by 2020.
n japan 0.4342 n UK 62.5561 n HK 6.4058 n CHINA 7.2212 n singapore 34.8761 n australia 37.4402 n EU 53.0643 n SAUDI arabia 13.2555
See “Toyota,” A2
Source: BSP (27 January 2017 )
BMReports BusinessMirror
A2 Monday, January 30, 2017
www.businessmirror.com.ph
Investing in rivers can help PHL bag ‘First World’ status Continued from A1
River, allowing it to spur economic activities, generate income and provide employment through tourism. Following the footsteps of Singapore and other first-world economies, the Philippines should be able to sustain growth by optimizing the ecosystems services provided by rivers and its abundant supply of freshwater, Lopex said. “The key to all the other firstworld economies was the cleaning of their rivers; from Germany to France, to Korea,” says Lopez, an environmental advocate who once led the Pasig River Rehabilitation Commission, the agency tasked to rehabilitate one of the country’s most polluted. “So the recipe works.” The Denr, the agency mandated to manage the country’s natural wealth, is implementing various programs geared toward protecting and conserving the country’s rivers. Rivers are a major source of freshwater supply that supports the growth of various sectors, including agriculture, fisheries, power, trans-
Debate. . .
Continued from A1
lawmakers has intensified. Federation of Philippine Industries (FPI) Chairman Jesus L. Arranza cautioned senators from being associated with HB 4144, as the lone company that supported it in the House is now embroiled in a taxevasion probe. In advising the Senate to be cautious with the “Mighty bill”, Arranza quoted the legal doctrine, “He who comes to court should come with clean hands.” “How can the Senate act on a tax bill openly being pushed by a company now under investigation for tax evasion?” Arranza asked. “No senator, especially the reelectionists would want to be associated with this bill.” “Let the BIR investigation finish first to see if the company is guilty or not before the Senate acts on this HB,” he added. Internal Revenue Commissioner Caesar Dulay has ordered the investigation of Mighty, after receiving field reports from his agents, who discovered fake tax stamps affixed on Mighty products. Finance Secretary Carlos G. Dominguez III backed Dulay’s move, and ordered tighter monitoring and enforcement. Tax stamps on cigarette packs are proof of excise-tax payment. In a social-media post, Rep. Joey
portation and various industries.
Key to survival
AS water is a very important economic resource, rivers are drivers of growth and development in many areas. Rivers help sustain economic activities, including agriculture and fisheries, tourism and transportation. Rivers also help provide water supply for domestic, commercial and industrial uses. The power industry also use hydropower, a renewable-energy (RE) source, to generate electricity. According to the River Basin Control Office, some of the major river basins have been providing the power sector a boost through hydropower, an RE source, which largely remained largely untapped. Some of the country’s major rivers support existing hydropower plants, ranging from micro, mini, small and large hydropower, which can generate enormous amount of electricity. Among these are the Abra River Basin, Apayao-Abulug River Basin, Agno river Basin, Bicol River Basin, Cagayan River Basin, Pampanga S. Salceda, an advocate of the unitary system, hinted that the subject of the BIR probe is the same company that will benefit from the passage of HB 4144. “Prime beneficiary of the twotiered specific excise tax on cigarettes,” read Salceda’s comment on the news article regarding the investigation on Mighty. Arranza said that, based on various sources and estimates, government revenue losses from nonpayment of excise taxes have reached “an alarming P10 billion a year”. Mighty, represented by former National Economic and Development Authority Secretary Romulo Neri, testified before the House Ways and Means Committee, they favor HB 4144, which seeks to impose higher excise taxes on cigarettes while changing the current unitary system to the old two-tier structure that bred the practice of tax underdeclaration for low price cigarette manufacturers. The departments of Finance, Health and of Agriculture, the BIR, NGOs and various farmers’ groups openly opposed HB 4144, as this would set back the revenue and public-health gains of the successful “sin” tax law. The Federation of Free Farmers and the PhilTobacco Growers Association are especially opposed to the “very high tax rates” under HB 4144. All cigarette manufacturers also objected to the bill,
River Basin, Ranao River Basin, Agusan River Basin, Cagayan de Oro River Basin, Mindanao River Basin and the Tagoloan River Basin. The Magat Dam, which draws supply from the Agno River and Cagayan River, generates 5.4 megawatts of electricity, while the Canescan transbasin tunnel generates 160 megawatts. The Lake Buhi Hydropower Plant in Bicol generates 2.8 MW of power.
Growth driver
HYDROELECTRIC power plants draw power from the Agus River Basin and generates 727 MW, while the Agus hydropower 6, which draws power from the Agusan River, generates 200 MW of electricity. Without adequate water supply, growth and development is impossible. Metro Manila, home to 12 million people, depends on raw water coming from the Angat watershed fed, with freshwater f lowing from numerous rivers and streams within the Angat watershed. These raw water flow all the way to the Ipo Dam and to the La Mesa Dam for treatment and distribuexcept Mighty, the leading producer of cheap cigarettes. In an unprecedented move, Arranza’s FPI has joined major business groups in the country in expressing strong opposition to the proposal, which came out in a series of print ads. The others signatories included the Philippine Chamber of Commerce and Industry, Employers Confederation of the Philippines, Makati Business Club, Financial Executives Institute of the Philippines, Management Association of the Philippines and the Foundation for Economic Freedom. The print-ad manifesto was also signed by the various international business chambers, including the American Chamber of Commerce of the Philippines, Federation of Filipino-Chinese Chamber of Commerce and Industry Inc., European Chamber of Commerce of the Philippines, Australian-New Zealand Chamber of Commerce, Canadian Chamber of Commerce, Japanese Chamber of Commerce and Industry of the Philippines, the US-Asean Business Council and the Korean Chamber of Commerce Philippines. Earlier, Arranza said going back to the two-tier system in taxing cigarettes may violate the country’s antitrust law. “Imposing two tax rates on cigarettes is creating market segmentation that favors manufacturers that sell cheaper
tion as tap water supplying Metro Manila and the Greater Manila Area—essentially for drinking and other household use. Industrial and commercial establishments also rely on the water provided by the Maynilad Water Services and Manila Water Corp., the private water companies contracted by the Metroplitan Waterworks and Sewerage System. The National Capital Region alone accounts for 37.2 percent of the GDP of the Philippines, according to the National Economic and Development Authority (Neda). Outside Metro Manila, rivers provide water mainly for irrigation to sustain agricultural production, livestock, poultry and fisheries.
riculture. It can also supply energy through hydropower,” Lim said. “Rivers support freshwater fisheries that serve as food for the people and other animals. They also support certain life stages of fish that migrate to and from the sea.” According to her, rivers are habitat for some of the country’s endemic species, such as freshwater crocodiles, sailfin lizards and some frogs, which, in turn, keep the river ecosystem healthy and sustain the food web, including the fisheries supply. “Its banks support specific plants and vegetation that can be food and also provide fiber and materials for fixture and furniture,” she said. “These various uses and services is a function of the biodiversity in our rivers.”
Life support
DIRECTOR Theresa Mundita S. Lim of the DENR’s Biodiversity Management Bureau said rivers also play a crucial role as a type of wetland ecosystem in biodiversity conservation. According to Lim, rivers provide important ecosystem services. “The ecosystem supplies water for drinking and irrigation for ag-
Supply challenges
THE Philippines has abundant supply of freshwater. Rains feed and replenish inland water bodies, such as lakes, swamps, marshes and rivers, with freshwater supply during the rainy season. According to the Philippine Atmospheric, Geophysical and Astro-
brands and are subject too lower taxes. It’s against the competition law. If you are going to have a bigger market share, it should stem from fair competition in the market, and not because the tax system is favoring you,” Arranza said. The National Tobacco Administration was the lone agency that supported the proposed measure.
await the Senate hearings on the proposals before making any decision. “Right now, the lobbying is intense, but what I can assure the public is that my vote will be on the merits and would be the best for our farmers and our country.” Sen. Juan Edgardo M. Angara, Senate Ways and Means Committee chairman, said FPI officials will be summoned to testify on their allegations when the panel starts public hearings on the cigarette-tax bill. “They will be asked their position should the time come for hearings on the said bill,” Angara said in a text message to the BusinessMirror. For his part, Gatchalian said whether the cigarette tax is unitary or two-tier, “using fake tax stamps is criminal.” “It deprives the government of taxes. That should be proven and investigated immediately,” he added.
‘Careful study’
The Senate is not inclined to readily thumb down HB 4144 even as Sen. Sherwin T. Gatchalian pushed for a thorough probe on some of its private proponents that were allegedly linked to a fake tax-stamps scheme. Senate President Aquilino L. Pimentel III, however, assured that senators will not railroad the passage of any bill, and that all bills submitted for their consideration will be given due course. “We will study all bills [and we will act] based on merit,” the Senate leader said, adding, “but we will also not super rush anything.” Sen. Miguel F. Zubiri, Senate Trade, Commerce and Entrepreneurship Committee chairman, said it is “too early” to decide on the two-tiered tax for cigarettes bill. “I would want to listen to both sides of the story,” Zubiri said, “if maintaining the present rate will be good for the economy or will the two-tiered system will be better.” Zubiri added he would rather
‘Retain old scheme’
House Deputy Speaker Pia S. Cayetano of Taguig, one of the main proponents of the Sin Tax Reform Act, said the proposal “threatens to turn back the gains we have achieved in the last three years, particularly in improving taxcollection efficiency, reducing leakages and corruption, and effectively discouraging smoking among Filipinos, especially our youth.” “The Sin Tax Reform Act, which is hailed as a landmark health and
Toyota. . .
Continued from A1
Based on the BusinessMirror ’s computation, a vehicle worth P1 million would cost nearly P1.2 million if the latest proposal of the DOF would be passed. The DOF is seeking to impose an excise tax of P24,000 plus 40 percent of the value in excess of P600,000 for vehicles worth P600,000 up to P1.1 million. For luxury vehicles, the DOF wants to impose a tax of P1.22 million on those priced at P2.1 million. Buyers would also have to pay an additional tax of 200 percent of the value in excess of P2.1 million.
Judge. . .
Continued from A16
There was widespread condemnation of the order, from religious leaders, business executives, academics, political leaders and others. Trump’s supporters offered praise, calling it a necessary step on behalf of the nation’s security. Homeland Security officials said last Saturday night that 109 people who were already in transit to the United States when the order was signed were denied access; 173 were stopped before boarding planes heading to America. Eighty-one people who were stopped were eventually given waivers to enter the United States, officials said. The order appeared to be enforced chaotically, with agencies and officials around the globe interpreting it in different ways. The Stanford student, Nisrin Omer, a legal permanent resident, said she was held at John F. Kennedy
nomical Services Administration, rainfall distribution throughout the country varies from one region to another. The mean annual rainfall of the Philippines varies from 965 to 4,064 millimeters annually. The Philippines also experiences severe weather disturbances, which, on a positive note, can ensure adequate supply of freshwater all year round with proper watersupply management. Low pressure areas, tropical storms and typhoons induce rains that dump huge volume of rainwater—most of the time even causing massive flood. While the Philippines has sole control over 479 billion cubic meters of renewable water, according to the World Resources Institute, access to water when and where they are needed is often problematic. Even water stored in the country’s dams reach alarming or critically low levels during the dry season—forcing the reduced distribution or release of water when water levels are extremely low. To be continued
revenue measure, was passed by both chambers of Congress in 2012 and became a law in 2013, with a tax structure that is graduated to simplify the tiers for cigarette taxes— from the original five tiers down to two, and further down to just one by January 2017,” Cayetano said. “It is disappointing that only three years following the passage of the Sin Tax Reform Act and right on the eve of implementation of a unitary tax regime by next month, we now face the prospect of reverting to a two-tier system under HB 4144,” she added. Party-list Rep. Tom S. Villarin of Akbayan said he would rather wait for the ongoing review of the sin- tax law. “The law has worked out quite well for the past four years. Perhaps it would be better to see it through until the ongoing review is finished.” According to Villarin, the sin tax law of 2012 was designed precisely to generate enough revenue for universal health care, while gradually transitioning as a tool to encourage a healthier lifestyle for Filipinos by eventually discouraging smoking. Deputy Minority Leader and party-list Rep. Eugene Michael de Vera of ABS, principal author of the bill, defended HB 4144, saying the proposed two-tier scheme is “needed to help the country’s tobacco-farming industry and promote public health.” Butch Fernandez, Jovee Marie N. dela Cruz and Rea Cu
The DOF’s proposal could negate the expected gains of the Comprehensive Automotive Resurgence Strategy (CARS) Program of the Department of Trade and Industry. The CARS Program was crafted to spur the growth of the local auto industry by providing its participants with incentives. The Philippine unit of Toyota Motors was named as one of the top 10 bestperforming units of the Japanese auto brand last year. Local sales in 2016 amounted to 55,028 units, making it the third best-performing Toyota unit in Southeast Asia, in terms of sales, next to Thailand and Indonesia. The company is eyeing a conservative 10-percent increase in production this year as it expects CARSdriven production to kick in next year.
International Airport in New York for about five hours but was eventually allowed to leave the airport. Others who were detained appeared to be still in custody or sent back to their home countries. White House aides claimed last Saturday that there had been consultations with State Department and Homeland Security officials about carrying out the order. “Everyone who needed to know was informed,” one aide said. But that assertion was denied by multiple officials with knowledge of the interactions, including two officials at the State Department. Leaders of Customs and Border Protection and of Citizenship and Immigration Services — the two agencies most directly affected by the order—were on a telephone briefing on the new policy even as Trump signed it last Friday, two officials said. The ACLU’s legal case began with two Iraqis detained at Kennedy Airport, the named plaintiffs in the case. One was en route to reunite with his wife and son in Texas. The other had served alongside Americans in Iraq for a decade. New York Times News Service
news@businessmirror.com.ph
The Nation BusinessMirror
Bongbong asks Tribunal to expedite poll protest P
RESSING on his quest for truth, the camp of former Sen. Ferdinand “Bongbong” R. Marcos Jr. late last week asked the Supreme Court, acting as the Presidential Electoral Tribunal (PET), to expedite his election protest by setting his case for preliminary conference. “Today former Sen. Bongbong Marcos presses on his quest for truth with the filing of this motion to set the case for preliminary conference,” lawyer Victor Rodriguez, spokesman of Marcos, said in an interview shortly after the filing at the PET on Friday. In a four-page ex-parte motion filed by lawyer George Erwin Garcia, Marcos said it is about time the PET issued the notice for preliminary conference, since the last pleading joining the issues in his case had been filed and served as early as September 9 last year. Under Rule 29 of the 2010 Rules of the PET, the preliminary conference should have been set after the filing of the last pleading. “Protestant [Marcos]...respectfully moves to set the above-entitled case for preliminary conference pursuant to [2010 PET Rules], considering that the last pleading joining the issues in this election protest case had been filed and served as early as 9 September 2016,” the pleading said. Rodriguez explained the setting of the preliminary conference is important, because it will set in motion the issues to be resolved, the list of witnesses and the evidence to be presented, as well as the
schedu le of hearings and the revision of the ballots, in his protest. “This is impor t a nt, because the preliminar y conference will set into motion Senator Marcos’s marcos election protest, so it can finally move forward,” he added. Rodriguez noted Marcos’s motion is without prejudice to the resolution of the Tribunal on the resolution on the two incidents still to be resolved by the Court. Rodriguez stated there remain two major pending motions that require resolution by the PET. He said these are the Motion to Strike Out the Answer of former Liberal Party Rep. Maria Leonor G. Robredo of Camarines Sur for being filed out of time, which was filed on September 9, 2016; and Marcos’s Manifestation with Motion to Admit Attached Verification, filed on September 20, 2016. “There remain two pending incidents that we are, likewise, awaiting resolution, but more than these motions, we want the case to finally move forward, so we can finally present our evidence of massive election fraud in the vicepresidential race in the last elections,” Rodriguez said. Joel R. San Juan
Editor: Dionisio L. Pelayo • Monday, January 30, 2017 A3
‘No problem with delisting of Sison from US terror list’
D
By Priam F. Nepomuceno | Philippines News Agency
EFENSE Secretary Delfin N. Lorenzana on Sunday said the defense and military establishments have no problem with calls to remove the name of National Democratic Front (NDF) political consultant Jose Maria Sison from the United States’s list of terrorists. “As far as I am concerned, the defense department or the Armed Forces has no problem with the delisting of [Sison] as head of a ter ror ist organization,” Lorenzana added. He said this is only natural, as the government is now talking with the insurgents as part of the efforts to restore peace in the countryside. However, he stressed that Sison’s removal from the US terror list, despite the Philippines’s request, is still the prerogative of the US government. “It’s up to the US on whether they would heed our request. That’s actually their prerogative to delist or not delist people on their list who are terrorists,” Lorenzana said. A joint statement to be issued at the end of the third round of formal talks between NDF and government negotiators
in Rome included a request to US government to take out the name of Sison from its list of terrorists. “We have a basis [for such request], considering he is in the [peace] process... the peace talks, which neSISON gates the character of a terrorist,” government lead negotiator Silvestre H. Bello III said. Meanwhile, Army troops were on actual combat operations when they clashed with
New People’s Army rebels in North Cotabato on January 21, a militant farmers’ group claimed. The troops had been operating in Makilala, North Cotabato, since last year, said Gerry Alborme, chairman of the Kilusang Magbubukid ng Pilipinas-North Cotabato. “Soldiers from the 39th and 72nd I n f a nt r y B at t a l ion s h ave conduc ted militar y operations in the villages of Lukatong, Israel, Kisante, Biangan and Bulatucan in Makilala, North Cotabato. Since November, farmers have reported sightings of soldiers conducting reconnaissance and intelligence operations in their barrios. These military operations have caused terror and fear among farmers,”Alborme said. “The soldiers thought their operations were “secret” and that we do not see them, but we always know when they are in the area,” said a local peasant leader, who asked not to be named for fear of his life. On January 21, at around 2 a.m., soldiers onboard a light truck entered the community in Barangay Kisante, Makilala. By 6 a.m., the soldiers started venturing into the forest and the clash happened in Sitio Concepcion, Barangay Biangan, between 4 and 4:30 p.m. Other farmers said that after the January 21 clash in Barangay Biangan, soldiers cordoned off their community in Barangay Kisante, set up a checkpoint and frisked all people entering the village.
With Marvyn N. Benaning
Economy
A4 Monday, January 30, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon
BusinessMirror
news@businessmirror.com.ph
Fuel-marking scheme to fight smuggling–NTRC
T
By Jovee Marie N. dela Cruz
@joveemarie
he National Tax Research Center (NTRC) has backed the proposal of the House of Representatives and the Department of Finance to revive the fuel-marking scheme to prevent smuggling. In a position paper submitted to the lower chamber, NTRC acting Executive Director Trinidad A. Rodriguez said fuel marking will prevent fuel fraud and smuggling while raising government revenues. Fuel marking is one of compensatory measures under the proposed tax-reform package. “In general, fuel marking adopted by various countries aims to prevent fuel fraud and smuggling,” Rodriguez said. He said the fuel marking scheme has a “huge” benefit to the government as it will increase tax receipts— without raising taxes—and sales revenue from increased volumes of official fuel in legal circulation. “[It will also] enhance control to improve tax compliance and mitigate against tax evasion while minimizing losses from fuel fraud, hence the corresponding uplift in fuel revenues and tax receipts provide measurable returns on investment,” Rodriguez added. He added it will also ensure t hat gover nment bod ies and regulators are able to collect the appropriate amount of revenue
from excise tax on fuel. “[Fuel marking will] prevent the illegal import of no or low-tax products and the dumping of transit, export or subsidized fuels,” Rodriguez said. According to Rodriguez, governments around the world adopt fuel-marking scheme as a tax administration measure to prevent fuel fraud and smuggling due to unequal tax rates imposed on different kinds of fuels. He said fuel-marking scheme is intended to monitor to correct payment of taxes and prevent revenue loss arising from illicit transfer of fuel. “Unfortunately, there is no enough available data with regard to the pilot testing of the fuel marking in the Philippines to ascertain the effectiveness of the program to curb smuggling,” Rodriguez said. “However, based on the experiences of other countries, the implementation of fuel marking enables their governments to raise more revenue by preventing fuel smuggling and adulteration, hence, fuel marking is a worthy undertaking,” he added.
Bloomberg
Rodriguez noted that fuel marking is not new in the Philippines. As early as 1983, chemical markers have been used to monitor petroleum products quality. But, in January 2014, he said the Department of Energy discontinued
the use of chemical marker on fuel because it adopted a more practical product-quality monitor procedure though direct and indiscriminate product sampling and resting to check compliance with the Philippine National Standard.
House Committee on Ways and Means Chairman and PDP-Laban Rep. Dakila Carlo E. Cua of Quirino, principal author of the tax-reform package, said setting up a fuel marking and monitoring system is expected to increase revenue from fuel taxes
FPI asks BOC chief to probe auctions of seized angle bars
T
he Federation of Philippines Industries (FPI) is asking Customs Commissioner Nicanor E. Faeldon to investigate three public auctions conducted by the Bureau of Customs (BOC) for some 1,500 metric tons (MT) of steel angle bars that were earlier seized due to misdeclaration. FPI Chairman Jesus L. Arranza, in a letter to Faeldon, said the public auctions conducted by the BOC-Port of Manila (POM) on October 24, 2016, and November 18, 2016, and by the BOC-Manila International Container Port (MICP) last November 22, need to be reviewed for
“possible anomalies.” This is in line with the Duterte administration’s campaign to end corruption in the government. Arranza informed Faeldon that based on the report of the Steel Angles, Shapes and Sections Manufacturers Association of the Philippines Inc. (Sassmapi), the October 24, 2016, bidding conducted by the BOC-POM, for instance, seemed suspicious, as 10 of the 12 bidders were disqualified “despite having submitted the required documents”. VPharma won the bidding for the 18 containers of confiscated angle bars weighing 321 MT with a bid price of only P2.20 per kilogram in the October 24, 2016, auction.
Sassmapi wrote a letter to the BOC last November 2 to seek a probe on the auction, “but they have not yet received any feedback regarding the said request up to now,” Arranza said. In the November 18, 2016, auction, also at the BOC-POM, Luchu Enterprise won with a bid price of P10.25 per kg for the first batch and P13.03 per kg for the second batch, both totaling 526 MT. Sassmapi members were allowed to participate in this bidding and the bid prices were considerably higher than the winning bid in the October 24, 2016, auction. At the auction held last November 22
at the MICP, Sassmapi members failed to qualify, and the winning bids were very low anew. All Top Trading won with a bid price of only P2.20 per kg for the first batch, while RMCE Metal won the second batch with a bid price of P2.32 per kg. “Sassmapi reported that several members wanted to join the public auction at MICP but were unable to qualify due to the lack of time to secure additional document requirements needed for a corporation,” Arranza said. Arranza added these circumstances prompted them to ask Faeldon to investigate the public auctions.
Construction materials in NCR more expensive in 2016—PSA By Cai U. Ordinario
@cuo_bm
W
holesale construction prices in Metro Manila went up by 1.4 percent in 2016, according to the latest data from the Philippine Statistics Authority (PSA). Data on the Construction Materials Wholesale Price Index (CMWPI) in the National Capital Region (NCR) showed that the figure was a turnaround from a contraction of 0.7 percent recorded in 2015. The year-in-year increase in 2016 was largely due to higher prices of sand and gravel at 3.4 percent; cement, 2.3 percent; and reinforcing steel, 5.7 percent. “In addition, the index of cement exhibited an annual average rate of 1.9 percent in 2016 from [a contraction of] 0.2 percent in 2015,” the PSA said. Last December the CMWPI in Metro Manila expanded by 3.1 percent, from 2.1 percent last November and 0.1 percent in December 2015. The PSA attributed the increase to the double-digit annual growth of 11 percent in the fuels and lubricants index. Further, there were higher annual increases in the indices of sand and gravel at 3.9 percent; reinforcing steel, 7.9 percent; and electrical works, 0.5 percent. On a monthly basis, the CMWPI in NCR inched up by 0.5 percent in December 2016. Its growth was 0.3 percent in the previous month. “Upward price adjustments were noted in gravel, coco lumber, steel and flat bars, and circuit breaker. Price hikes were also observed in gasoline, diesel and fuel oil,” the PSA said. The PSA said higher prices of reinforcing steel at 0.8 percent and fuels, as well as lubricants at 3.3 percent caused the increase. Further, from zero growth, the indices of lumber rose by 0.4 percent; structural steel, 0.5 percent; and electrical works, 0.2 percent. The PSA said the CMWPI is a variant of the General Wholesale Price Index that measures the changes in the average wholesale prices of construction materials.
It added that the CMWPI is used for the computation of price escalation of construction materials for various government projects.
The current CMWPI market basket considered those construction materials prevailing in 2000. The market basket for the 2000-based series includes 102 items.
and high-quality petroleum sold in the market. “This step will certainly plug the leakage of duties and taxes due on this commodity and protect both the consumers and the environment,” Cua added.
DENR chief assures due process in conduct of mine audit By Jonathan L. Mayuga
T
@jonlmayuga
he Department of Environment and Natural Resources (DENR) said it has “meticulously observed” due process in the audit of existing metallic mines. In a statement, Environment Secretary Regina Paz L. Lopez assured the public that the results of the mine audit, which will be announced on February 2, would promote social justice and the common good. “We assure the industry and the general public that due process was meticulously observed in the mining audit conducted by the agency, and that the results would really promote the common good and social justice,” Lopez said. Mining’s big players under the Chamber of Mines of the Philippines criticized the DENR chief for her focus on large-scale mining, while being “lenient” in regulating illegal small-scale mining activities. Lopez has included environmental, biodiversity and social aspects of mining operations among the audit criteria, to promote responsible mining. For Lopez, responsible mining means the integrity of the environment is not compromised and the activities involving the large-scale extraction of mineral deposits underneath the earth’s surface will not cause suffering among people. A total of 15 teams from the DENR’s central and field offices, along with civil-society organization representatives, conducted the audit and submitted their recommendations for final evaluation of the DENR chief. The audit came following President Duterte’s criticism of large-scale mining’s adverse impact to the environment. In his first State of the Nation Address last July, Mr. Duterte said he had ordered a review of all permits granted to mining, logging and other similarly environmentally sensitive activities to ensure compliance with government standards. The President also said, if warranted, the DENR may amend, suspend or revoke those permits. “There is a need for evaluation to see if these companies are complying with the laws. Responsible mining means people should not suffer,” Lopez said. Barely a week at the DENR, Lopez ordered an industry-wide audit to look into the adequacy and efficiency of environmental-protection measures taken by the mining companies, determine gaps in those measures and identify the appropriate penalties for violations of mining and environmental laws. Of the total 41 metallic miners reviewed by the DENR, only 11 of them "passed" the initial audit while the remaining 30 were either suspended or recommended for suspension for failing to meet environmental safety standards.
AseanMonday
A6 Monday, January 30, 2017 • Editor: Max V. de Leon
BusinessMirror
Jakarta stocks miss gain as race for governor takes Islamic turn
I
t’s the world’s worst-performing emerging stock market since the election of US President Donald J. Trump and the only developing Southeast Asian exchange to see outflows this year. Investors are concerned over a religious feud that’s erupted in the race for Jakarta governor, government attempts to gag criticism and a rate-cutting cycle that looks to have ended. The Jakarta Composite Index (JCI) has fallen 3 percent since November 8, when Trump’s win fueled expectations for a stronger dollar and faster Federal Reserve rate increases, compared with a 1.3-percent advance in a gauge of emerging-market equities. Voters go to the polls February 15 in a contest in which the incumbent governor, an ethnic Chinese Christian who’s an ally of President Joko Widodo, has appeared in court over charges he insulted Islam. Hundreds of thousands of Muslims have taken to the streets in protest, with the race viewed as a possible precursor to a conservative Muslim challenge against Widodo in the 2019 presidential vote. “The Jakarta election is being seen as a struggle between those who believe that Indonesia should remain a moderate country and the right wing movement,” said Jemmy Paul, investment director at PT
Sucorinvest Asset Management in Jakarta. “Foreigners also see this as posing a risk to the ability of President Widodo to continue his reform agenda.” Overseas investors have been trimming their positions, Paul said. Foreign funds pulled $110 million from local equities this month through Wednesday, compared with inflows of $152 million in Thailand and $77 million in Malaysia. Paul, who said he still targets a 13-percent increase in the stock benchmark this year, said they may reenter the market after the election. The JCI declined 0.2 percent as of 9:08 a.m. local time on Friday. Factors that are weighing on Indonesia’s stock market: n Jakarta Governor Basuki Tjahaja Purnama, who was Widodo’s deputy before he became president in 2014, has been charged with blasphemy for comments saying voters were being deceived by people trying to use Koranic verses to say that Muslims were not permitted to support a Christian leader. Purnama has denied the charges. He leads the three-way race with a 38.2-percent
support in a poll by Indikator Politik Indonesia, the Jakarta Post reported on Thursday. The government said on January 3 it was cutting all business ties with JPMorgan Chase & Co. because of a November note in which the US firm downgraded its assessment of Indonesian equities by two notches. It also said other banks that are primary dealers for its sovereign-bond issues should maintain professionalism and integrity. JPMorgan last week raised its tactical view on Indonesian stocks by one level to neutral. Rising US interest rates and a stronger greenback are weighing on the rupiah this year, with the 13,836 a dollar year-end median estimate of analysts implying a 3.5-percent drop from current levels. Morgan Stanley is predicting two 25-basis-point rate increases by Bank
Indonesia in the second half of 2017 to stem inflation and says “risks are tilted to the downside” due to the global headwinds, according to a Jan. 17 note by strategists Sean Gardiner and Aarti Shah. Indonesia’s reaction to the JPMorgan note and the apparent influence of religion on the political process are causes for investor concern, said Michael McCarthy, chief market strategist at CMC Markets in Sydney. President Widodo is popular with the market for his scrapping of most fuel subsidies, and his focus on infrastructure and opening Indonesia up to more foreign investment.
Temporary drag
Not everyone is pessimistic about Indonesian stocks. Their relatively low valuations—the cheapest after
Thailand among Asean emerging markets—and the government’s infrastructure spending plans may provide support. Andrew Swan, the Hong Kongbased head of Asian fundamental equities at BlackRock Inc., said Indonesia remained among his mostfavored markets due to its cyclical recover story, citing a preference for financial and infrastructure stocks. Harry Su, head of research at PT Bahana Securities in Jakarta, forecasts the benchmark index to rise more than 10 percent to 6,000 later this year once the election uncertainty clears. “Unless religious and racist issues on the ground are resolved, investments won’t be forthcoming” Su said, adding that the political situation is acting as a temporary drag on the JCI. Bloomberg News
Cambodia’s ‘perfect pepper’ conquering world’s taste buds
K
AMPOT, Cambodia—A nearby sea, flanking mountains, a quartz-rich soil: It’s the perfect spot on earth, devotees say, to yield a product they describe in that rapturous vocabulary usually reserved for fine wines: “aristocratic, virile, almost aphrodisiacal,” with subtle notes of caramel, gingerbread and mild tobacco. Celebrity chefs from Paris to Los Angeles swear by Kampot pepper, a southwestern Cambodian spice with a tragic past that is now reclaiming its global preeminence. It is also proving to be “black gold” for some of its once-impoverished farmers, thanks in part to Kampot pepper last year being awarded a Protected Geographical Indication by the European Union. This identifies unique products—like Stilton cheese, Champagne or Darjeeling tea— as originating in a very specific region. So far Kampot pepper production is a mere dusting—just 70 tons last year. Vietnam, the world’s top pepper producer, churned out some 145,000 tons of the spice. But more plantations are springing up, while Kampot quality is rated as high as ever and hitherto slack markets, like the United States, are getting hooked on the spice. A New York chef has even concocted a Kampot pepper ice cream, while Michelin three-starred French Chef Olivier Roellinger rhapsodizes about its “olfactory richness” and broad spectrum of flavors. The spice’s EU designation “has permitted a renaissance of pepper in Kampot.... This not only recognizes the singularity of this pepper but helps protect it from imitations,” says Nathalie Chaboche, a Frenchwoman who with her Belgian husband, Guy Porre, owns La Plantation, where pepper plants entwine 20,000 posts on a rolling green landscape fronted by the Gulf of Thailand. The couple, who started the enterprise four years ago after lucrative careers in the computer industry, aim to boost production from 6 tons last year to 50 tons in 2018. They intend to grow without weakening quality control or endangering Kampot’s status as a premier cru, a French term for wine and other produce signifying impeccable quality—and hefty price. Kampot red pepper was recently selling in Germany for as much as €378 per kilogram ($185 per pound), compared to an average import price of about $8 for one kilo in Europe for Vietnamese pepper. The farm-gate price for the three pepper varieties—red, white and black—averages around $10 per pound.
In this November 24, 2016, photo, sacks of La Plantation pepper are ready for export to France in Kampot, Cambodia. Lauded by celebrity chefs, exorbitantly priced, Cambodia’s Kampot pepper is enjoying a renaissance. AP
Believed to have originated in southern India, pepper became a widely traded item across Asia and Europe. Pepper farming in Cambodia was first recorded by a Chinese traveler in the 13th century, and energized centuries later by French colonialists. By the early 1900s annual production peaked at 8,000 tons. War disrupted the industry and after their 1975 victory, the murderous Khmer Rouge turned farmers into slave laborers. Deeming the “king of spice” too decadent for their ultra-revolution, the regime left plantations to decay. A Japanese aid worker, Hironobu Kurata, pioneered a revival in the mid-1990s, but the scars of the Khmer Rouge era took long to heal. As late as 2000, only 2 tons were grown annually, but now about 450 farms produce Kampot pepper. Most belong to the Kampot
Pepper Promotion Association, which assists in price-setting and marketing while policing strict standards, including adherence to organic practices. Cultivators use methods tested over 700 years, with some injecting new techniques. Sorn Sothy, a former teacher and social worker, tries to reproduce the jungle environment native to the pepper plant on her small plantation. Palm leaves are used as shade; the soil is enriched with bat and cow manure mixed with bloodied animal bones. To ward off predatory insects, she sprays plants with a bitter extract from the leaves of neem trees. The plantation run by Chaboche and Porre is Cambodia’s first semiautomated pepper operation, but its more than 100 employees still do much of the work by hand. “Our growing is traditional. The processing is
modern,” Porre says. Jean-Marie Brun, a French agricultural development expert, says the advent of large plantations could lower prices, and possibly quality. “The future will tell us if the large plantations are as successful as the smallholder farms,” he says. Ngoun Lay, the association’s head and a fourth-generation pepper farmer, waxes bullish about the future despite potential problems and ongoing robust sales of fake Kampot pepper, mostly from Vietnam. A recent report, he says, shows European demand for the brand at around 200 tons, while production next year is expected at some 100. Farm gate prices have tripled over the past seven years, keeping once-poor farmers on the land rather than seeking menial work in neighboring Thailand. AP
news@businessmirror.com.ph
China poised to ‘fill the vacuum’ after US kills off TPP
M
OSCOW—The US withdrawal from the TransPacific Partnership (TPP) trade deal is an opportunity for China to fill the gap, and even pursue a free-trade agreement with Mexico, Lourdes Casanova, academic director of the Emerging Markets Institute at Cornell University, told Radio Sputnik. On January 23 Donald J. Trump signed an executive order fulfilling his campaign promise to stop the TPP trade deal. A lthough it was uncertain whether the deal would have been ratified by the US Congress, Trump’s move has finally killed off the controversial deal, which had 12 signatories and proposed to create the world’s largest freetrade area, accounting for roughly 40 percent of global GDP. TTP was strongly supported by former US President Barack Obama, who saw the free-trade deal as a crucial part of his “pivot to Asia” foreign policy. However, the deal was the subject of protests in the US and other countries such as New Zealand, as people feared that reducing trade barriers would have a negative effect on jobs in developed countries, and that regulatory changes would leave public institutions vulnerable to legal action from multinational corporations and intensify the commercialization of public services, such as health care. China was not involved in the TPP negotiations, but other signatories have said they would like to continue the project in another form, with the inclusion of China. On Tuesday Australian Prime Minister Malcolm Turnbull said he had held discussions with Japanese Prime Minister Shinzo Abe, New Zealand Prime Minister Bill English and Singaporean Prime Minister Lee Hsien Loong about the possibility of continuing without the US, but with China. “There is also the opportunity for the TPP to proceed without the United States,” Turnbull told reporters in Canberra. “Certainly, there is the potential for China to join the TPP,” he added. Casanova told Radio Sputnik that China is ready to assume a leadership role in support of global free trade, in the absence of the US. “China is going to try to fill the vacuum that the US is leaving on the one hand, and on the second hand it will try to enlarge the Apec with 21 members,” Casanova said. Delegates show their opposition to the TPP during Day One of the Democratic National Convention at the Wells Fargo Center in Philadelphia, Pennsylvania, July 25, 2016. Last November Chinese President Xi Jinping attended the AsiaPacific Economic Cooperation (Apec) forum in Lima, where he promoted the Regional Comprehensive Economic Partnership (RCEP), an alternative to the TPP that is currently being negotiated by 16 states in East Asia and Australasia. “China will not shut its door to the outside world but open [them wider],” Xi told Apec delegates. Xi also defended free trade in a speech to the Davos World Economic Forum last week, and outlined plans to expand the RCEP. “We will advance the building of the free-trade area of the Asia Pacific and negotiations of the Regional Comprehensive Economic Partnership to form a global network of free-trade arrangements. China stands for concluding open, transparent and win-win regional free-trade arrangements and opposes forming exclusive groups that are fragmented in nature,” the Chinese President said. Casanova said that Japan has been particularly hard hit by the collapse of the TPP. PNA/Sputnik
Agriculture/Commodities BusinessMirror
news@businessmirror.com.ph
Editor: Jennifer A. Ng • Monday, January 30, 2017
A7
Russia keen on exporting pork, chicken to PHL–DA By Jasper Emmanuel Y. Arcalas
R
@jearcalas
USSIA has expressed interest in exporting pork, cattle and poultry meat to the Philippines during a recent meeting aimed at bolstering trade relations between the countries, the Department of Agriculture (DA) said on Sunday.
Agriculture Undersecretar y for Operations A r iel T. Cayanan said officials from Moscow made this pronouncement during the Russia-Philippines Joint Commission on Trade and Economic Cooperation held on January 26. Cayanan said he told the 19man Russian delegation that the Philippines is keen on exporting mangoes, bananas, avocados and vegetables, such as okra, to Russia. “On beha lf of A g r icu lt ure Secretary Emmanuel F. Piñol, the department hopes to pursue more agriculture cooperation
with your country,” he said in a statement. Cayanan noted that the last memorandum of understanding between Russia and the Philippines was signed in 2007. Alexander V. Tysbulskiy, cochairman of the joint commission, said Russian companies also want to export grains, such as wheat and barley, to the Philippines. Tysbulskiy said Russia is one of the biggest grain exporters, shipping over 40 million tons of grains every year to different countries. “ T he advantage of Russia, compared to ot her g ra in- e xporting countries, is its short
distance to the Philippines,” Cayanan said. As for Russian meat products, the DA official told members of the delegation that they need to meet hurdle the restrictions set by the Philippine government. During the Asia-Pacific Economic Cooperation (Apec) Leaders Meeting in Peru last November, Russia committed to purchase $2.5 billion worth of agricultural products from the Philippines starting this year. Socioeconomic Planning Secretary and National Economic and Development Authority Director General Ernesto M. Pernia earlier
said recent trade agreements with Russia would boost the country’s trade performance, particularly on agricultural exports. The Philippines’s total agricultural exports receipt to Russia in 2015 reached $14.6 million, accounting for only 0.29 percent of the agricultural exports that year, according to data from the Philippine Statistics Authority. The country’s top agricultu– ral export to Moscow was crude animal and vegetable materials (including hides, skins and furskins) valued at $6.72 million, followed by vegetables and fruits at $5.77 million.
Many farmers failed to get govt aid due to unreliable data—PIDS By Cai U. Ordinario @cuo_bm
L
E A K AGE S a nd “e x c lu sions” were found in the government’s database of farmers and fishermen, making it difficult to provide help the agriculture sector, according to the Philippine Institute for Development Studies (PIDS). In the study, titled “Evaluation of the Registry Service for Basic Sectors in Agriculture”, the state-owned think tank urged the government to update and improve the Registry Service for Basic Sectors in Agriculture (RSBSA). “Making the RSBSA a working and functional registry for those in the agriculture and fisheries sector can be an efficient program targeting tool, provided
that proposed improvements w i l l b e m at e r i a l i z e d ,” t he authors said. The study noted that, while the RSBSA was a “useful tool” for policy and programming efforts of the government, such as financing and state-funded insurance, there are many irregularities on the list. It found that legitimate agricultural producers were excluded from the list while those who should not be in it were included. Based on the authors’ calculations, there were about 9.78 million farmers, farm workers and fishermen registered in the RSBSA. The bulk of the farmers came from Region 6, or Western Visayas, with 1.03 million farmers and farm laborers. “There are about 3.8 million rice farmers registered in the
RSBSA, with the majority of them found in Regions 1, 6 and 3,” the study read. PIDS also found that the tot a l ag r ic u lt u re producers listed in the RSBSA reached 534,4 80 in Aurora, Bata an, Eastern Samar, Northern Sam a r, Misa m is Or ient a l a nd Davao del Norte. Only 13,878 were insured by the Philippine Crop Insurance Corp. (PCIC), but 64.74 percent were not included in the RSBSA. The study, however, noted
that the proportion of agricultural producers insured by PCIC not listed in the RSBSA declined by 13.18 percent in 2014, but the proportion of excluded farmers is still significant at 51.56 percent. “Although one cannot generalize from a sample of six provinces, one can see that there is a sizable number of agricultural producers excluded in the registry. Because of this, PCIC had to cover almost one-third of the cost of its own RSBSA program,” the study read. Data also showed that there were only 20,163 agrarian reform beneficiaries (ARBs) in the RSBSA, while data from the Department of Agrarian Reform (DAR) indicated there were 164,118. This leaves 143,955 ARBs in the DAR data that were not in-
cluded in the registry. The study stated that this represented only 12 percent of ARBs in the RSBSA. The authors noted there were problems in linking the list with other databases, there was no validation of the information contained on the list, and the total arable/agricultural land could also be understated on the list. The study also found that the operational definition of “farmer” was unclear and that concerned agencies might need to fine-tune the list according to their own program objectives. With these problems, the local and national government agencies encountered problems using budget allocations for programs. The Land Bank of the Philippines and Peoples Credit Financing Corp. could not fully tap the P1-billion budget programmed for
the Agriculture and Fisheries Financing Program because of these loopholes. “The PCIC was not able to provide subsidized insurance to many farmers/fishermen who applied because they are not on the RSBSA list, and some of them were already regular patrons under the regular insurance programs of the corporation,” the study read. The authors added that the missing information in the RSBSA prevented the Bureau of Fisheries and Aquatic Resources from helping fisherfolk to obtain insurance PCIC. They also warned that the funds extended by the Department of Agriculture to farmers excluded from the RSBSA could open them to questions from the Commission on Audit.
A8
The World BusinessMirror
Monday, January 30, 2017 • Editor: Lyn Resurreccion
Trump sets lobbying ban for officials
President Donald J. Trump holds up a signed executive order in the Oval Office of the White House on Saturday in Washington. The document includes restrictions against lobbying for “Every appointee in every executive agency appointed on or after January 20.” AP/Alex Brandon
W
ASHINGTON—President Donald J. Trump acted on Saturday to fulfill a key portion of his pledge to “drain the swamp” in Washington, banning administration officials from ever lobbying the US on behalf of a foreign government and imposing a separate five-year ban on other lobbying. Trump has said individuals who want to aid him in his quest to “Make America Great Again” should focus
on the jobs they will be doing to help the American people, not thinking ahead to the future income they could
5
The number of years administration officials are banned on lobbying rake in by peddling their influence after serving in the government. “Most of the people standing behind me will not be able to go to work,” Trump joked, referring to an array of White House officials who lined up behind him as he sat at his Oval Office desk. The officials included Vice President Mike Pence, Chief of Staff Reince Priebus, senior
strategist Steve Bannon and counselor Kellyanne Conway. “So you have one last chance to get out.” Trump said he talked about the ban a lot during the campaign and “we’re now putting it into effect.” In a pair of separate actions, Trump took steps to begin restructuring the White House National Security Council and the Homeland Security Council. He also gave Defense Secretary Jim Mattis and the Joint Chiefs of Staff, the president’s top military advisers, 30 days to come up with a plan defeat the Islamic State (IS) group. Scores of people have been killed in terrorist acts that IS has carried out overseas or has inspired on US soil. Under an executive order
that Trump signed in the presence of the news media, every political appointee joining the executive branch on or after January 20—the day Trump took office—must agree to the lobbying bans. That includes avoiding, for five years after leaving, lobbying the agency they worked for. Another provision sets a two-year period during which appointees must avoid working on issues involving former employers or clients. Trump is allowed to waive any of the restrictions. Questions had been raised about how the bans would be enforced. The order says they are “solely enforceable” by the US government “by any legally available means”, including debarment proceeding within any affected executive branch agency, or civil court proceedings. Former appointees who are found to have violated the ban may also be barred from lobbying their former agency for up to five years, on top of the five-year period covered by the pledge, the executive order states. Trump said the order supersedes one that President Barack Obama signed on January 21, 2009, that banned anyone from lobbying the government for a period of two years after leaving. Trump said Obama’s order was “full of loopholes”. The president signed the order and a pair of presidential memoranda near the end of an intense day of telephone diplomacy during which he discussed a range of issues with the leaders of Japan, Germany, Russia, France and Australia. All are leaders Trump needs to build relationships with. Trump had released the plan for a lobbying ban a few weeks before the November election, one of several promised policies aimed at curbing corruption and the influence of lobbyists in Washington. Trump also made promises about transparency and ethics. Some have argued that the ban could make it difficult for Trump to fill thousands of jobs throughout the administration by causing some candidates to become squeamish about limiting their ability to make money after they leave government employment. Others say the prohibitions on lobbying are too insignificant to be effective. AP
UK’s PM May focuses on Middle East with Turkey defense deal
U
NITED KINGDOM Prime Minister Theresa May announced a defense deal between BAE Systems Plc. and Turkish Aerospace Industries to develop Turkey’s first home-built fighter jet, calling it a step to expand trade with the nation. “It marks the start of a new and deeper trading relationship with Turkey, and will potentially secure British and Turkish jobs and prosperity for decades to come,” May said, as
she arrived on Saturday in Ankara, a day after meeting US President Donald J. Trump. May was to meet with Turkish President Recep Tayyip Erdogan and Prime Minister Binali Yildirim later in the day. This first agreement, worth £100 million ($125.6 million), could facilitate “multibillion pound” deals between the two countries in the future, the government said in its statement. The fighter project was said to have been delayed after a coup
attempt against Erdogan last year. The UK is hoping to agree on a “jumbo” post-Brexit trade deal with Turkey, Foreign Minister Boris Johnson said last year. While talks between May and her Turkish counterparts are to focus on trade, the prime minister urged Erdogan in a joint appearance to honor Turkey’s human-rights commitments. “I am proud that the UK stood with you on July 15 last year in defense of democracy,” May said. “Now
it is important that Turkey sustains that democracy by maintaining the rule of law and upholding its international human-rights obligations as the government has undertaken to do.” Erdogan’s government has come under fire for the hard line it took with the many soldiers, teachers, judges and business leaders it holds responsible for last summer’s failed coup. The UK and Turkey also are connected through their respective rela-
tions with Cyprus, an island nation divided since a Turkish invasion in the 1970s. Britain ruled Cyprus until a war in pursuit of unification with Greece led to independence in 1960. The three so-called guarantor nations— Greece, Turkey and the UK—met with Cypriot officials earlier this month seeking an accord on security and property rights as Turkey maintains a military presence on the island. Bloomberg News
news@businessmirror.com.ph
Trump’s econ vows harder to hit after a slow 2016
P
resident Donald J. Trump’s target for economic growth just got a little more distant. The government reported on Friday that the economy grew by only 1.6 percent last year, shy of what experts had estimated and well below the 4-percent rate that Trump has vowed to deliver—a pledge now cited on the White House web site. There are plenty of signs of life in the economy. Consumer spending is healthy, and an index of consumer sentiment just hit a 12-year high. Stocks have been surging, and the jobless rate is near what the Federal Reserve considers full employment. But, however solid, the recovery under President Barack Obama never reached exuberance. It is the second-longest recovery in US history but the first in the postwar era in which growth for a full year did not hit 3 percent. Trump made that data point a focus of his campaign, citing factories that closed during the recession but never reopened and workers who gave up looking for jobs and dropped out of the labor force. And economists, even if they disagree with his policy prescriptions, acknowledge that many areas have been left behind. While Friday’s report will provide more support for Trump’s argument, the lackluster pace of economic growth may also complicate the new administration’s plans. Indeed, some of the headwinds in 2016—like a widening trade deficit and cautious spending by businesses—could persist into 2017 and beyond. In particular, lower exports and higher imports also hurt growth in the fourth quarter, which fell to an annual rate of 1.9 percent from 3.5 percent in the prior quarter, the Commerce Department said last Friday. In 2016 personal consumption— which accounts for a majority of economic activity—slowed from 2014 and 2015. In addition, the sharp plunge in oil prices over the same period prompted steep cuts in energy production and exploration, contributing to a drop in business investment. All of this underscores why analysts say that Trump’s growth rate target of 4 percent is audacious at best and fanciful at worst, especially given broader factors, like an aging population and the growth rate of 2 percent or so that has prevailed since the recovery began in 2009. “It would defy gravity,” Diane Swonk, a veteran independent economist in Chicago, said. A 4-percent growth would require big gains in the size of the work force and productivity, but neither is in the offing, Swonk said, adding, “It’s simple math.” New York Times News Service
German pride shifting to frustration in role as growth driver of Europe
G
ermany is cursed by its own economic strength. For eight years the nation of 83 million people has been the euro area’s growth driver. Now it’s at the forefront of the currency bloc’s reflation, with price increases potentially exceeding 2 percent, and dissatisfaction with the European Central Bank (ECB) has morphed into outrage. Critics and media are slamming the institution’s monetary stance— set to support not just Germany but the entire 19-nation region— as mainstream parties struggle to contain a surge in populism ahead of national elections. Finance Minister Wolfgang Schaeuble has warned that higher inflation could cause “political problems,” and German monetary officials are urging their peers to start
devising an exit strategy from unconventional stimulus. “ECB-bashing in Germany will certainly speed up on Monday,” said Carsten Brzeski, an economist at ING-DiBa AG in Frankfurt. “It’s a completely overblown discussion— as long as you have core inflation of around 1 percent in Germany, there really isn’t any reason to worry.” German inflation saw the largest jump on record when it accelerated to 1.7 percent last December, as euroarea price growth almost doubled to 1.1 percent. The country’s states will start to release January data at 9 a.m. on Monday, with national figures due at 2 p.m. Another strong reading—economists predict 2 percent—would fan a debate questioning the ECB’s policy stance that was fired up after the
country’s most-read newspaper Bild responded to last month’s increase with a call to “Raise rates now!”
German angst
Prominent German economists and politicians are blunt in their warnings that monetary stimulus is going too far, even with inflation primarily driven by energy costs that the ECB can’t control. Germany’s central bankers are nudging their colleagues toward a discussion about how to normalize policy in more subtle tones. ECB Executive Board Member Sabine Lautenschlaeger argued that “all preconditions for a stable rise in inflation exist” and the question of an exit can “soon” be addressed. Bundesbank President Jens Weidmann repeatedly warns of risks
related to asset purchases and an overly accommodative stance. Even though Germany’s aversion to inflation—rooted in the 1920s, when workers used wheelbarrows to collect their daily pay—is met with sympathy abroad, the intensity of the discussion has some people spooked. Spanish Prime Minister Mariano Rajoy expressed concern last week over a premature tightening, given that his nation still has about a fifth of its work force standing idle. A slew of data this week will provide an update on growth, inflation and confidence in the euro-area economy. Any improvements in the region’s data will also be a reflection of Germany’s economic dominance. The country has driven the recovery since the 2008 financial meltdown and mitigated the double-dip
recession in 2012 and 2013 following the debt crisis. But with faster growth comes faster inflation.
Mathematical equation
“You have periphery states with very low inflation because capacity isn’t fully utilized there, and Germany, where a higher capacity utilization results in a stronger upward trend of prices,” said Stefan Kipar, an economist at Bayerische Landesbank in Munich. “It’s a mathematical equation—even when the ECB reaches its goal of inflation just below 2 percent on average, some countries will have lower rates while others will overshoot.” ECB President Mario Draghi has tried to assuage German concerns, arguing the continued support of the euro-area economy with low in-
terest rates and asset purchases is in the country’s interest, and inflation is far from spiraling out of control. His argument is that underlying price pressures are still weak. German companies are only partially passing on higher costs to clients, and consumers haven’t noticed a significant pickup in inflation. Wage growth has remained subdued despite above-potential growth over the past three years and a decline in unemployment to a record low. “Wages in Germany have been growing moderately in past years, but that hasn’t led to any significant upward pressure on German core inflation, and I don’t really see that changing this year,” said Andreas Rees, an economist at UniCredit Bank AG in Frankfurt. “I don’t really see any big inflation risks.” Bloomberg News
news@businessmirror.com.ph
The World BusinessMirror
Monday, January 30, 2016 A9
Trump’s immigration ban draws anger, praise
A
group of Nobel Prize winners said it would damage US leadership in higher education and research. House Speaker Paul D. Ryan and some relatives of Americans killed in terrorist attacks said it was right on target. An evangelical Christian group called it an affront to human dignity.
The reaction on Saturday to President Donald J. Trump’s ban on refugees entering the United States, with particular focus on certain Muslim countries in the Middle East and Africa, was swift, certain—and sharply divided. The order drew sharp and widespread condemnation on Saturday from Democrats, religious groups, business leaders, academics and others, who called it inhumane, discriminatory and akin to taking a “wrecking ball to the Statue of Liberty.” Thousands of professors, including several Nobel laureates, signed a statement calling it a “major step toward implementing the stringent racial and religious profiling promised on the campaign trail.” Thousands of protesters rushed to airports to demand the release of people who were being held on arrival. The protesters erupted in cheers on Saturday night when a federal judge in Brooklyn ruled that the government could not immediately send the travelers back. And around the world, allies and critics alike voiced concern about what the new US policy could mean. Iran’s Ministry of Foreign Affairs called the executive order “a clear insult to the Islamic world,” a violation of international law, and “a great gift to extremists and their supporters.” It warned that Iran “will take reciprocal measures in order to safeguard the rights of its citizens.” Stéphane Dujarric, a spokesman for the United Nations, said, “We hope that these measures are temporary, as refugee-protection needs have never been greater.” Prime Minister Justin Trudeau of Canada used his Twitter feed to reiterate his government’s open policy toward refugees, particularly
Critics called the order inhumane, discriminatory and akin to taking a ‘wrecking ball to the Statue of Liberty.’” those from Syria. “To those fleeing persecution, terror & war, Canadians will welcome you, regardless of your faith,” Trudeau wrote. “Diversity is our strength.” International reaction, though, was far from uniform. Politicians who have called for restricting Muslim immigration have gained support in a number of European countries, and one of them, Geert Wilders of the Netherlands, praised Trump on Twitter: “I would do the same. Hope you’ll add more Islamic countries like Saudi Arabia soon.” Still, some immigration policy experts in the US questioned the logic behind the action. They noted that terrorists who had carried out attacks in the US had not entered as refugees and that Muslim attackers had been born here or came from countries like Pakistan or Saudi Arabia—which were not on the list of seven mostly Muslim countries that the administration has singled out for a halt to entry. “Foreigners from those seven nations have killed zero Americans in terrorist attacks on US soil between 1975 and the end of 2015,” Alex
Hameed Khalid Darweesh (center), a former interpreter for the US military in Iraq, speaks after his release from detention during a protest outside John F. Kennedy International Airport in New York on January 28. Reactions were divided after President Donald J. Trump issued an executive order on Friday banning refugees from seven predominantly Muslim countries from entering the US. Darweesh is flanked by Rep. Nydia Velasquez (left) and Rep. Jerrold Nadler, both of New York. Victor J. Blue/The New York Times
Nowrasteh, an immigration policy analyst at the libertarian Cato Institute, wrote on the group’s web site. The president’s executive order, issued on Friday, brought a positive, if muted, reaction from some Republicans, and could prove popular politically. Michael Banerian, 22, who was a Trump elector in the Electoral College and is the youth vice chairman of the Michigan Republican Party, said he saw the president’s more narrowly tailored order as common sense. “I feel that it’s a necessary step for us to take for the security of our nation,” he said. “I don’t think it’s un-American. I think it’s very reasonable.” Kathleen Ganci, 67, whose husband, Peter J. Ganci, the highestranking uniformed officer of the New York Fire Department, was killed in the September 11, 2001, attacks, said she supported the order, too. “I don’t care how difficult it makes
it for these people to come over,” she said. “I don’t want other Americans to go through what I did—because we have to care for our own first, before we care for others.” And Mark Krikorian, executive director of the Center for Immigration Studies, a group that seeks to restrict immigration, said it makes sense to suspend the refugee program temporarily, examine it “and at least begin to initiate some changes.” “I don’t know what form those changes will take, and I’m not sure the administration knows yet,” he said. The executive order put an indefinite halt to citizens of Syria, a country racked by civil war and an immense refugee crisis, entering the US. It suspended immigration for 90 days from Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen. It also suspended the nation’s program for admitting refugees
Tech industry frets over possible immigration changes
S
EATTLE—US technology companies for years have relied on a steady stream of skilled engineers from overseas to help them create their products. Now many of those companies and their workers are girding for expected changes to immigration policy under President Donald J. Trump that the companies say could hurt their ability to tap the technical talent they need to stay competitive. Trump, who has signed a series of executive orders related to immigration, is expected to soon take similar action on visa programs for foreign workers. A draft of a proposed executive order on the matter was leaked last week. While it is not clear how the final order will look and the draft contains some changes many in the technology industry support, some language alarmed people in Silicon Valley. The technology industry relies heavily on the H-1B visa program, through which highly skilled workers like software engineers are permitted to work in the US for companies like Microsoft, Google and Intel. The draft proposed a regulation to “restore the integrity of employment-based nonimmigrant worker programs” and to consider options for modifying the H-1B program to “ensure that beneficiaries of the program are the best and the brightest.”
That language rattled some executives and lawyers representing technology companies because of its implication of sweeping changes. “You’d be shocked at the number of people who are feeling fear, calling our firm alarmed based on what’s coming out,” said Priya Alagiri, an immigration lawyer based in the Bay Area who has tech clients. “It’s not just the undocumented. Even people who are here on green cards, legally. Citizens. They’re scared.” Some technology companies have started warning their investors of potential threats to their business from the changes. In a filing on Thursday with securities regulators related to its quarterly financial results, Microsoft included new language related to immigration. “Changes to US immigration policies that restrain the flow of technical and professional talent may inhibit our ability to adequately staff our research and development efforts,” the company said in the filing. Brad Smith, Microsoft’s president, said in a statement that the company believes “in a strong and balanced high-skilled immigration system and in broader immigration opportunities for talented and lawabiding young people like the Dreamers,” a reference to young people who entered the country illegally as children but were allowed to remain by
President Barack Obama. On Friday Mark Zuckerberg, chief executive of Facebook, waded into the broader immigration debate with a post in which he said he was concerned about Trump’s actions. Zuckerberg said his great-grandparents came from Germany, Austria and Poland, while his wife’s arrived from China and Vietnam. “We are a nation of immigrants, and we all benefit when the best and brightest from around the world can live, work and contribute here,” Zuckerberg wrote. “I hope we find the courage and compassion to bring people together and make this world a better place for everyone.” The technology industry is open to changes that have been proposed by members of Congress to better enforce the skilled worker program and adjust limits on the number of visas. But the companies see skilled worker visas as a signature policy issue that they have fought to protect and expand. They fear Jeff Sessions, the nominee for attorney general, and others in the administration will take a more severe approach to immigration and sweep up H-1B visas into prohibitions on refugees and stronger border protection. “The effect would end up being exactly the opposite of what Trump wants. Companies would go offshore
from anywhere in the world for 120 days, while the government comes up with a stricter process for vetting them, but allowed for exceptions for persecuted religious minorities, like Christians in Muslim countries. Trump said the moves were needed to protect the US from infiltration by “radical Islamic terrorists.” Ryan released a statement saying, “President Trump is right to make sure we are doing everything possible to know exactly who is entering our country.” Many other leading congressional Republicans, including Mitch McConnell, the Senate majority leader, did not make statements on the matter. By Saturday afternoon, members of Congress were hearing from constituents whose friends or relatives were detained at airports. Two Republicans who did not
like Microsoft did with Vancouver, Canada” to seek talent, said Robert D. Atkinson, president of the Information Technology and Innovation Foundation, a research group sponsored by several tech firms. Zuckerberg has been an outspoken proponent of immigration issues and how they may affect those inside and outside of Silicon Valley. In 2013 with other tech leaders, Zuckerberg backed Fwd.us, a nonprofit group dedicated to comprehensive immigration change. But Trump has made it increasingly clear that immigration policy may change drastically. Any changes to the Deferred Action for Childhood Arrivals (Daca) program, initiated under the Obama administration, could have significant effects on current tech employees who fear for their status. “Right now, we are focused on making sure for protections for 750,000 Dreamers who have Daca stay in place,” Todd Schulte, president of Fwd. us, said in an interview. “If the goal is to increase public safety and prevent future illegal immigration, the way to do that is to modernize the legal immigration process. That’s radically different than a large scale ramp up of rapid deportation.” The White House did not respond to a request for comment. New York Times News Service
support Trump’s candidacy, Sen. Ben Sasse of Nebraska and Rep. Charlie Dent of Pennsylvania, criticized Trump’s order. Sasse called it overly broad, saying that it risks playing into the hands of jihadi groups that portray the US as anti-Muslim. Dent said he was awakened by his college-aged son, whose Syrian-American friend had six family members being held at Philadelphia’s airport on Saturday morning, though they had valid documents to enter the country. The congressman said despite his attempts to intervene with government officials, the family was placed on a flight bound for Qatar. “This is ridiculous,” he said. “The order was rushed through without any nuances toward immigration policy, and this can be life or death for some people.” New York Times News Service
The World BusinessMirror
A10 Monday, January 30, 2017
news@businessmirror.com.ph
NYC airport becomes scene of anguish after travel ban
N
EW YORK—New York City’s Kennedy airport became a scene of anguish and desperation on Saturday for the families of people detained after arriving in the United States from nations subject to President Donald J. Trump’s travel ban.
Many flights to the US already were in the air on Friday when the president’s order barred entry to citizens of seven predominantly Muslim nations. A federal judge in New York on Saturday night issued an emergency order temporarily barring the US from deporting people who arrived with valid visas or an approved refugee application. But Trump’s immigration ban caused chaos earlier in the day. Lawyers and advocates working at the airport said they didn’t have a hard count on the number of people taken into custody after getting off their flights. Yosre Ghaled, 25, was among about a dozen distraught people waiting at an airport terminal on Saturday to see if loved ones would be released, or put back on an outgoing plane. Her mother-in-law’s sister, a 67-year-old Yemeni citizen coming to live with family in the US because she is sick from heart problems and diabetes, was detained after getting off a plane from Saudi Arabia. “We’re very sad. She lives a very bad life. We try in her last days to [give her] a good life,” Ghaled said, adding that the family had been told that she would be refused entry and put on a jet back to Saudi Arabia. “We’ve waited for this many years, [for] her to come. They should just let us see her. Seeing her would make you feel a little better.” Similar scenes of despair and fear played out at airports across the country, where protests ranging from a few dozen people to thousands of demonstrators also took place. Relatives said two families were
denied entry to the United States upon arrival at Philadelphia International Airport on Saturday and returned to Qatar. “They were told their paperwork is not valid,” Sarah Assali, 25, of Allentown, Pennsylvania, told The Philadelphia Inquirer. She said six of her relatives, Christians from Damascus, had arrived after an 18-hour flight from Doha, Qatar. At Los Angeles International Airport, lawyer Talia Inlender said an Iranian woman was detained after arriving on a flight from Amsterdam with her 1-year-old American son. Inlender said she had been approved to become an American citizen and was scheduled to take her naturalization oath in February. Trump said the goal of the temporary travel restriction was to keep out potential terrorists. Two members of Congress, New York Democrats Jerrold Nadler and Nydia Velazquez, joined several hundred protesters who spent part of the day at Kennedy airport trying to win the release of about a dozen people they said had been detained. People in the crowd chanted “Let them in.” Celebrities, including Sex and the City actress Cynthia Nixon, joined the demonstration. The detainees in New York included two Iraqis who had previously been given permission to come to the US because of their ties to the US military. One of them, Hameed Khalid Darweesh, who had worked as an interpreter for the US Army after it invaded Iraq in 2003, emerged
Children held by Kurdish forces allege torture–report
I
RBIL, Iraq—Children detained by Iraq's Kurdistan Regional Government on suspicion that they have connections to the Islamic State (IS) group are alleging they were tortured, according to a report from an international human-rights group published on Sunday. The children—who have not been formally charged with a crime—recount being held in stress positions, burned with cigarettes, shocked with electricity and beaten with plastic pipes, according to Human Rights Watch (HRW), a New York-based international watchdog. More than 180 boys under the age of 18 are currently being held, HRW estimates, and government officials have not informed their families where they are, increasing the likelihood the children could be disappeared. The rights group says they interviewed 19 boys aged 11 to 17 while they were in custody at a children’s reformatory in Irbil. The group says the interviews were conducted without a security official or intelligence officer present. As Iraqi security forces have retaken territory from IS over the past year and a half, they have also detained hundreds of men and boys. Many of those detained have likely suffered inhumane treatment or been tortured. Rights groups warn such practices risk sowing resentment of Iraqi security forces in the wake of military victories against IS. “If the authorities and the international coalition really care about combatting ISIS [Islamic State in Iraq and Syria], they need to look beyond the military solution, and at the policies that have empowered it,” Belkis Wille, the senior Iraq researcher for HRW told The Associated Press. “Policies, like torture, enforced disappearances, destruction of property and displacement, are and will continue to [be] drivers for victims’ families to join extremist groups,” she added. AP
Mansour Kenereh (center) reunites with family members in the international arrivals lobby at Hartsfield-Jackson International Airport in Atlanta on Saturday. The family of three were among several people detained at the US Customs and Border Protection office following an executive order from President Donald J. Trump limiting immigration. Kent D. Johnson/Atlanta Journal-Constitution via AP
from custody to cheers from the crowd in the midafternoon. He pronounced the US “the land of freedom” home to “the greatest people in the world” upon his release, but also expressed dismay about having been initially held. Still being held at the airport
in the late afternoon was Haider Sameer Abdulkhaleq Alshawi, 33, an Iraqi who had been trying to reunite with his wife in Texas. She had come to the US because she feared for her life after having worked for a US security contractor. Lawyers sat on the floor of an air-
port terminal on Saturday evening working up court petitions on their laptops on behalf of detainees. New York Gov. Andrew Cuomo, a Democrat, said he had directed state lawyers and the agency that controls Kennedy to “explore all legal options” to assist anyone detained
at New York airports. “I never thought I’d see the day when refugees, who have fled wartorn countries in search of a better life, would be turned away at our doorstep,” Cuomo said. “This is not who we are, and not who we should be.” AP
Syrian refugees’ dream of better life crushed by Trump’s ban
A
MMAN, Jordan—Syrian refugee Ammar Sawan took a first hopeful step toward moving to the United States last fall, submitting to an initial security screening. His dream of a better life was abruptly crushed when President Donald J. Trump banned Syrian refugees from the US until further notice. Sawan learned of the entry ban while watching late night TV news with his wife in their small apartment in the Jordanian capital of Amman. “When we heard of the order, it was like a bolt of lightning, and all our hopes and dreams vanished,” the 40-year-old said on Saturday, a day after Trump’s executive order. He and other Syrian refugees bristled at the idea that they pose a potential security threat, saying they are peaceful people fleeing persecution. Some warned that the new US policy will be seen as targeting Muslims and further inflame anti-American sentiment in the region. “This decision made the US loose its reputation in the world as the biggest economy, the biggest democracy,” said refugee Nasser Sheik, 44, who was paralyzed by a stroke two years ago and lives with his family in Amman. “We are not going out to harm people of other countries,” added his wife Madaya, 37. Trump on Friday suspended all refugee admissions to the US for four months and banned the entry of Syrian refugees indefinitely pending a security review meant to ensure terrorists cannot slip through vetting. Trump also issued a 90-day ban on all entry
84,995 The number of refugees the US accepted in the last budget year, including 12,587 from Syria
to the US from seven Muslim-majority countries with terrorism concerns, including Syria. At the time of Trump’s decision, more than 27,000 Syrian refugees from 11 Middle Eastern host countries were being considered for resettlement to the US and were in various stages of the approval process, according to the International Organization for Migration. During the last budget year, the US accepted 84,995 refugees, including 12,587 from Syria. Close to 5 million Syrians have fled their country since an uprising against President Bashar al-Assad erupted in 2011 and escalated into civil war. Most refugees have settled in neighboring countries, including Jordan and Lebanon where their struggle for survival gets tougher every day. Savings have run out, jobs are poorly paid and refugee children learn in crowded classrooms. Many refugees prefer to return home, but that’s not an option as long as the war continues. Eager to escape tough conditions in the host countries, resettlement to the West now seems the best alternative. Ammar Sawan fled the Damascus suburb of Moadamiyeh in 2012, after he was roughed up by pro-Assad
militiamen and feared eventual arrest. His wife Sanaa, 35, and three sons followed him a year later, fleeing government shelling. The couple had a fourth child, a girl, in Jordan, last year. The family struggles to cover rent, utilities and school transportation for the three oldest, especially during the winter when Sawan’s income from his part-time work as an upholsterer drops. Sawan worries about his children, including bullying in school. His oldest, 15-year-old Khaled, said Jordanian students sometimes pick fights with Syrians schoolmates. Sawan said he underwent the first round of security vetting for possible resettlement to the US last October. With a new life in America suddenly in reach, he began to dream of a decent education for his children and a stable income for the family. “My dream, even before the war in Syria, was to live in America,” he said, as the family huddled around a gas heater in the living room. Now he is disappointed in America. “We are not terrorists and we don't support terrorism,” he said. Refugee aid groups said Trump’s ban is hurting innocent people. “It will not make America safer,” Jan Egeland, head of the Norwegian Refugee Council, said by phone from Oslo. “It will make America smaller and meaner.” He said the new US policy deals a blow to international responsibility for those fleeing persecution, an idea forged in the aftermath of the Holocaust when Jews and others seeking safe haven were often let down. Others said US security checks of refugees are already robust, involving
biometric screening and up to three years of vetting. The suspension of the refugee admissions allows for exceptions, including for members of minority faiths claiming persecution, such as Christians in Muslim-majority countries. Feras Zahka, 35, a Syrian Christian who fled to Turkey, is in the final stages of vetting to immigrate to the US, but now fears he won’t be able to go. “I was going through security screenings before the [US] elections took place,” he said by phone from Istanbul, where he works as a hotel receptionist. “I am scared my file will be scrapped.” Bashir al-Saadi, 67, a Christian in the town of Qamishli in northern Syria, said giving preferential treatment to Christians could raise tensions with their Muslim neighbors. “Giving visas to Christians [only] will give the impression that the US is a Christian state and is standing against Islam,” said al-Saadi, who has family in the US. “This will trigger resentment, might foment religious conflict and reflect badly on us.” Mohammed Hassan al-Homsi, who fled his hometown of Palmyra in Syria, said Trump’s decision would serve as propaganda fodder for Islamic State (IS), the extremist group that controls parts of Syria and Iraq. The entry ban will encourage IS supporters, al-Homsi wrote in text messages from Syria's rebel-held province of Idlib where he found refuge. “This decision proves the militant group’s theory that the West, led by the United States, is an enemy of Muslims,” he wrote. “It’s an unfortunate decision.” AP
The World BusinessMirror
www.businessmirror.com.ph
Monday, January 30, 2017 A11
Trump makes uneven entry onto world stage
W
ASHINGTON—One week into office, President Donald J. Trump was trying to clean up his first international incident.
The president shifted a jampacked schedule on Friday to make room for an hourlong phone call with Mexican President Enrique Peña Nieto, who had abruptly snubbed the new president by canceling a visit. Trump’s team had appeared to respond by threatening a hefty border tax on Mexican imports. By the end of the conversation, Trump had tasked his son-inlaw and senior adviser, Jared Kushner—a real -state executive with no national-security experience—with managing the ongoing dispute, according to an administration official with knowledge of the call. The episode, an uneven diplomatic debut, revealed the earliest signs of how the new president plans to manage world affairs. In a matter of days, he both alarmed and reassured international partners. He picked fights, then quickly backed away from them. He talked tough, and toned it down. At each step, Trump relied on the small clutch of advisers that guided his normbreaking campaign, a group with scant foreign-policy experience but the trust of the president. Much of the foreign-policy decision-making has rested with Kushner and Steve Bannon, the conservative media executive-turned-White House adviser, according to administration officials and diplomats. Rex Tillerson, his nominee for secretary of state, is still awaiting confirmation. Officials at the National Security Council, an agency Trump has described as bloated, are still seeking marching orders from the new administration.
Phone calls
Some of Trump’s early diplomatic moves have followed standard protocols. He scheduled early phone calls with friendly allies, including Canadian Prime Minister Justin Trudeau and Israeli Prime Minis-
ter Benjamin Netanyahu, who both plan to meet Trump at the White House next month. Additional calls were planned on Saturday with German Chancellor Angela Merkel and French President François Hollande, key European partners. But Trump also moved swiftly to announce a new era. He declared an end to efforts to pursue multination trade deals and used his first executive action to withdraw the US from a sweeping Pacific Rim pact. He also effectively closed off the United States to refugees, at least temporarily, and risked angering the Arab world by halting visas for people from seven majority Muslim nations for at least three months. On his first full day as president, he told members of the intelligence community gathered at CIA headquarters that the US should have taken Iraq’s oil for “economic reasons,” given America’s efforts in the country, adding, “but, OK, maybe you’ll have another chance.” Some officials at the National Security Council raised concerns over several elements of the refugee measure, as well as other early actions the president took on border security. But administration officials say Trump’s inner circle has addressed few of their concerns. Administration officials and diplomats insisted on anonymity to disclose private dealings with the White House.
Kushner and Bannon
Kushner and Bannon have been heavily involved in the Trump administration’s early dealings with some European partners, leading during both phone calls and in-person meetings with diplomats and government officials. In a discussion with British officials, Kushner is said to have angrily denounced the United Kingdom’s decision to support a UN
US President Donald J. Trump making a phone call.
Security Council resolution condemning the expansion of Israeli settlements. The US abstained from the vote before President Barack Obama left office, brushing aside Trump’s demands that the US exercise its veto. Asked about Kushner’s involvement on foreign policy, a White House official said he was “particularly well-suited for sensitive negotiations and relationship building.” In contrast with the Trump team’s strong views on Israel, European partners have been left largely in the dark about Trump’s approach to Russia. Some are on edge over a phone call with Russian President Vladimir Putin on Saturday and fear he may strike a deal that leads to the removal of US sanctions on Russia. The call was said to be arranged by national security adviser Mike Flynn, who has kept a low profile in recent days amid scrutiny over his ties to Russian officials. Trump did little to ease anxieties on Friday when he pointedly refused to say whether he planned to keep in place economic sanctions on Russia as punishment for its provocations in Ukraine. “We’ll see what happens,” Trump said during a news conference with British Prime Minister Theresa May.
Bloomberg News
The prime minister was the first world leader to meet Trump following last week’s inauguration, underscoring May’s eagerness to get a reading on a man who is a mystery to many world leaders. Trump was measured during their brief joint press conference, but he also showed flashes of charm, joking with May about a British reporter’s pointed question about his position on torture and complimenting her for being a “people person.” A visit from Peña Nieto to Washington had been expected to follow May’s. But after Trump needled the Mexican president on Twitter, saying it would be better for him not to come if he couldn’t commit to paying for Trump’s proposed wall along the US southern border, Peña Nieto told the White House he wouldn’t be coming. The White House quickly threatened to slap a 20-percent tax on imports from Mexico to pay for the wall, though officials quickly tried to walk the proposal back, saying it was just one option being considered. Kushner, who already wields enormous power in the White House, is expected to work through the dispute with Mexican Foreign Minister Luis Videgaray. The two men, who know each other from the financial
Environmentalists preparing to battle Trump, GOP in court
C
HICAGO—The night before Donald J. rump’s inauguration, five environmental lawyers filed a federal court brief defending an Obama administration clean-water rule that the new president and his Republican allies have targeted for elimination, considering it burdensome to landowners. The move served as a warning that environmentalists, facing a hostile administration and a Republican-dominated Congress, are prepared to battle in court against what they fear will be a wave of unfavorable policies concerning climate change, wildlife protection, federal lands and pollution. Advocacy groups nationwide are hiring more staff lawyers. They’re coordinating with private attorneys and firms that have volunteered to help. They’re reviewing statutes, setting priorities and seeking donations. “It’s going to be all-out war,” Vermont Law School Professor Patrick Parenteau said. “If you’re an environmentalist or conservationist, this is, indeed, a scary time.” Trump’s first week in office only heightened their anxieties. He moved to resume construction of the Keystone XL and Dakota Access pipelines that the Obama administration had halted, while signaling intentions to abandon his predecessor’s fight against global warming, vastly expand oil and gas drilling on public lands and slash the Environmental Protection Agency’s (EPA) budget.
GOP lawmakers, meanwhile, introduced measures to overturn a new Interior Department rule barring coal-mining companies from damaging streams and to remove some wolves from the endangered species list. “They’ve wasted no time in doing bad things,” said Pat Gallagher, director of the Sierra Club’s 50-member legal team, which he said is likely to grow as environmentalists increasingly regard the courts as their best option, even though success there is far from certain. The Department of Justice, which represents the federal government in environmental lawsuits, declined to comment, while the White House did not respond to emails seeking comment. Doug Ericksen, communications director for Trump’s transition team at EPA, said of the environmentalists that he’s “not sure what they think they’re preparing for” but suspects they are stoking fear of Trump as a fundraising tool. “They’re more concerned about raising money than protecting the environment,” Ericksen said. Jim Burling, litigation director for the Pacific Legal Foundation, a nonprofit property-rights group that sues regulators on behalf of businesses and landowners, also contended environmental groups were exaggerating the Trump administration’s threat for political and financial gain. The government bureaucracy is entrenched, Burling said, and, “who happens to occupy the White House
hasn’t made that much difference”. Environmentalists say their fears are justified by the new administration’s antagonism toward government’s role in keeping air and water clean and the planet from overheating. Donations began increasing after Trump’s election, “even before the fundraising letters were sent” asking for support to fight the administration’s actions, said David Goldston, government affairs director at the Natural Resources Defense Council. Earthjustice, which has represented the Standing Rock Sioux tribe in its fight against the Dakota Access Pipeline, has about 100 staff attorneys and plans to bring more aboard, said Tim Preso, who manages the group’s Northern Rockies office. The Chicago-based Environmental Law and Policy Center is adding four attorneys to its pre-election staff of 18 and is coordinating with more than a dozen outside attorneys who would file citizen suits against polluters for free if agencies fail to enforce existing rules, Executive Director Howard Learner said. “We cannot fully substitute and replace the EPA doing its job,” Learner said. “But on the other hand, we’re not going to default to zero if the EPA steps backward when it comes to clean air and clean water enforcement.” On inauguration eve, five law professors filed a brief in support of a 2015 regulation giving EPA and the Army Corps of Engineers discretion
to regulate tributaries and wetlands far upstream from navigable lakes and rivers to protect water quality. Dozens of states have sued to block the rule—including Oklahoma, led by state Attorney General Scott Pruitt, now Trump’s choice for EPA administrator—saying it gives government too much power over private property. Shortly after Trump took office, his White House webpage listed the rule among “harmful and unnecessary policies” he would target. “If the Trump administration won’t defend the rule, I want to stand alongside environmental groups and do what I can to defend [it],” said David Uhlmann, a University of Michigan law professor and former Justice Department prosecutor, who helped file the brief. Going to court is just one tactic environmental lawyers will use, said Erik Schlenker-Goodrich of the Oregon-based Western Environmental Law Center, which also plans new hires. They will monitor agencies for failure to enforce pollution law or cutting corners when writing permits for activities such as oil and gas drilling, he said. The Sierra Club’s Gallagher, who sued over oil drilling beneath national parks during the George W. Bush administration, said another tactic would be making liberal use of open-records laws to obtain scientific data and other materials that might otherwise be purged. The group already has requested records on climate change from the EPA. AP
circles, also worked together to arrange Trump’s surprise visit to Mexico during the presidential campaign. The readouts released by the two countries after Friday’s call pointed to the work to be done. A statement from Mexico said the presidents agreed “to no longer speak publicly” about their dispute over payment for the border wall. The White House statement made no such promise.
Trump, Putin to seek better ties
Trump and Putin pledged cooperation in fighting the Islamic State, the two sides said, as the pair seek to reverse tension after Russia’s invasion of the Ukraine, its support for Syria, and allegations that Russian hackers sought to sway the US election. “The positive call was a significant start to improving the relationship between the United States and Russia that is in need of repair,” the White House said in a statement. Putin told Trump he “sees the US as a most important partner in the fight against international terrorism,” according to a readout of the call from the Kremlin that described the conversation as “positive and businesslike.” The conversation, one of several Trump held with world leaders on
Saturday, was the among the first formal steps in his effort to reset relations with the Kremlin, which soured under the Obama administration after Russia’s invasion of the Ukraine and its support for Syrian leader Bashar al-Assad in his fight against rebel groups. Trump’s critics have questioned the wisdom of his calls for better ties with Putin, especially in light of the US intelligence community’s conclusion that Russia hacked e-mails of the Democratic National Committee in a bid to swing the November election in Trump’s favor. Trump has said he would consider easing financial penalties imposed by the US over the annexation of Crimea in 2014 in exchange for Russia’s support on a nuclear weapons deal or fighting terror groups like the Islamic State. Critics have argued that Russia’s support of Assad has nothing to do with Islamic State fighters based there, pointing to the fact that its air war has focused on rebels around Aleppo not affiliated with the group.
‘Active joint efforts’
Vice President Mike Pence participated in the call with Putin along with Bannon, chief of staff Reince Priebus, national security adviser Michael Flynn and press secretary Sean Spicer. The White House said the call lasted about an hour. “In the course of the conversation, both sides demonstrated a desire for active joint efforts to stabilize and develop Russia-American relations on a constructive, equitable and mutually beneficial basis,” the Kremlin said. “The importance was underlined of restoring mutually beneficial trade and economic ties between business on both sides.” There was no mention in either readout of the wide-ranging US sanctions targeting Russia’s banking, energy, and defense sectors. Some were imposed via executive order by former President Barack Obama, which Trump has the power to undo quickly. Trump downplayed the possibility of sanctions relief during a press conference on Friday, saying, “We’ll see what happens. As far as the sanctions, very early to be talking about that.” AP and Bloomberg News
Thailand segregates LGBT inmates
P
ATTAYA, Thailand—Theerayut Charoenpakdee was terrified when the police stopped her outside a mall in Pattaya, a Thai resort famous for its sordid nightlife. A urine test on the spot revealed meth coursing through her veins. “I thought I was going to be thrown in prison with all the men because I still have the title of Mr.,” the transgender woman said. “I was afraid. News and TV tells us that being sent to prison is scary.” It turned out not to be the ordeal she expected. The prison she was destined for—Pattaya Remand— separates lesbian, gay, bisexual and transgender (LGBT) prisoners from other inmates, a little-known policy despite being in place nationwide since 1993, according to the Department of Corrections. Thailand, often described as a haven for gay people, has around 300,000 prisoners, of which more than 6,000 are registered as sexual minorities. And that’s not all. The Thai government is also considering what could be the world’s first prison facility exclusively for LGBT inmates. While the plans are still being discussed, in Pattaya and other prisons across Thailand LGBT prisoners are kept apart to prevent violence, officials say. “If we didn’t separate them, people could start fighting over partners to sleep with,” said Pattaya Remand Warden Watcharavit Vachiralerphum. “It could lead to rape, sexual assault and the spread of disease.” By day, Pattaya LGBT inmates eat together and do their morning exercises in uniform. At night, they sleep in their own quarters, apart from the other inmates.
But most of the time, they mingle freely with the others, though they tend to stick together for daytime activities like sewing or football. Transgender women spike volleyballs next to men pressing barbells and sparing with punching bags; gay men train together in first aid at the jail clinic, sanitizing and bandaging the wounds of straight men. Ma ny LGBT i n m ates ag ree the limited separation is a decent compromise between safety and segregation. “There are people that discriminate against gays,” said Chawalit Chankiew, one of the gay clinic workers, sentenced to nine years for document forgery. “If I happen to sleep next to someone who hates gay people, I wouldn’t know it unless they show it. What if they hurt me one day?” Theerayut says the prison’s segregation makes her one-and-a-half-year sentence more bearable. “If we behave like others, if we aren’t stubborn and don’t break rules, this place actually isn’t so vicious,” she said, sitting in a prison yard fenced with barbed wire, her long hair bobbing up and down as she spoke. But the system isn’t without problems. “Transgender women who have not gone through gender reassignment surgery, they have to shave their head and live with the men, and there’s going to be problems,” says Wannapong Yodmuang, an LGBT advocate with the Rainbow Sky Association. “Some of them are going to be OK living with the men, but there are some transgender women who might have a bad experience with men and won’t want to live with them.” AP
Green Monday BusinessMirror
A12 Monday, January 30, 2017
www.businessmirror.com.ph • Editor: Lyn Resurreccion
The Calaca coal-fired power plant in Calaca, Batangas AC Dimatatac/ICSC
Is PHL ready to stop its coal addiction?
I
By Jonathan L. Mayuga
@jonlmayuga
s the Philippines ready for renewable energey (RE)? If Environment Secretary Regina Paz L. Lopez will have her way, there will be no new coal projects under her watch, as she vowed to help hasten the development of RE.
Lopez had earlier declared that Palawan, the country’s last ecological frontier, is “off-limits” to new coal projects to protect it against environmental degradation brought by its operation. Early this month she vowed to grant environmental compliance certificates (ECCs) to RE projects within two to three weeks. The Department of Environment and Nat ura l Resources (DENR) is c u r rent ly rev iewing 800 ECCs as par t of the DENR’s campaig n to promote socia l justice, env ironmenta l protection and prevent people from suffer ing. Environmental and climate advocacy groups welcomed Lopez’s policy pronouncement, lauding the official for her pro-RE stance. Republic Act 9513, or the RE Act of 2008, mandates the government to accelerate the exploration and development of RE resources, such as biomass, sol a r, w i nd , hyd ro, geot her mal and ocean energ y sources, including hybr id systems, to ac hieve energ y self-rel iance. The law promotes the adoption of sustainable-energy development strategies to reduce the country’s dependence on fossil fuels. R A 9513 encourages the development and utilization of R E resources as tools to effectively prevent or reduce har mful emissions to ensure balance economic grow th and development w it h t he protection of hea lth and the env ironment. Red Constantino, executive
director of the climate-policy think tank Institute for Climate and Sustainable Cities, said: “Secretary Gina Lopez’s move to fast-track RE projects proves the Duterte administration wants a win-win energy solution for the Filipino people. It shows it is possible to merge her vision of sustainable and clean energy with Energy Secretary Alfonso G. Cusi’s own vision of affordable power.” He added that doing away with the red tape in the approval of RE projects would considerably reduce business costs and invite even more investments into the country. “Likewise, removing the automatic fuel cost pass-through prov ision in coa l plants w il l lead to a level playing field,” Constantino said.
Incentives for RE
To promote RE investments in the Philippines, various incentives are provided by the government. T he Depar tment of Energ y (DOE) web site l ists incentives, which potential investors who want to invest in RE could avail themselves of. Developers of RE facilities, including hybrid and cogeneration systems using both RE sources and conventional energy for both power and nonpower applications, may avail themselves of, among others, income-tax holiday for seven years; duty-free importation of RE machinery, equipment and materials, including control and communication
equipment; special realty-ta x rates on equipment and machinery not exceeding 1.5 percent of their original cost less accumulated normal depreciation or net book value. The net operating loss during the first three years of commercial operation, which had not been previously deducted from gross income, may also be carried over as deduction from gross income for the next seven consecutive taxable years immediately following the year of such loss. Developers may a lso avai l themselves of corporate tax rate of 10 percent on its net taxable income, after seven years of income-tax holiday. Besides the income-tax holiday for seven years, manufacturers, fabricators and suppliers of locally produced RE equipment may avail themselves of tax and duty-free importation of components, parts and materials necessary for the manufacture and fabrication of equipment and components. They can also obtain tax credit on domestic capital components, parts and materials purchase made from DOE-accredited local manufacturers. For biomass, resources plantation, the incentives for farmers that are engaged in the plantation of jatropha, coconut and sugarcane include duty-free importation and exemption from value-added tax on all types of agricultural inputs, equipment and machinery, including spare parts.
Not enough incentives?
These incentives, however, have yet to lure the desired RE investments. According to the DOE, as of June 30, 2016, there are a total of 724 awarded projects under the RE law, with total installed capacity of 4,132.49 MW. Of these, only 3,988.61 MW go to the grid, with 143.88 MW for “own-use.” This means that even within the approved RE projects, the proponents have yet to maximize the full potential of RE. There are 318 pending projects with potential capacity of 7,282.34 MW.
Is the Philippines doing enough to promote RE?
According to Chuck Baclagon of 350.org, the current energy regime still subscribes to an outdated development paradigm that strives for quick and dirty fixes at the expense of people, ecosystems and the climate.
800
The number of environmental compliance certificates of renewable-energy projects that the Department of Environment and Natural Resources is reviewing
“Coal has no place in the country’s energy mix. Vulnerable countries like the Philippines should lead in curbing emissions. We must keep global warming within 1.5 degrees Celsius for a fighting chance to survive, and this requires halting all new fossil-fuel development now,” he said. Like Constantino, Baclagon lauded Lopez for her passion and commitment to uphold the Duterte administration’s mandate to protect the environment. “Her pronouncement to fasttrack the approval of environment permits for renewnable-energy projects proves that she lives up to the government’s promise of change,” he said.
Myths and realities
Gerry Arances of the Center for Energy, Ecology and Development (CEED) said “clean, cheap energy from coal is a myth.” Such notion, he said, was only meant to derail efforts to shift to RE. “The DOE’s Philippine Energy Plan spits at the promise of clean energy enshrined in the RE Act and our international commitment to combat climate change,” he said.
Arances said the DOE even plans to increase coal’s share in the primary energy mix at the expense of vast RE potential. Worse, he said, the DOE also plans to increase domestic coal extraction, “which will only lead to further destruction of the environment and loss of livelihood at a national scale.” “It is important to note that the ‘clean, cheap’ energy, which coal companies merely promise, is already a reality in a number of countries that had begun shifting from fossil fuels,” Arances said. Various studies, Arances argued, have shown that solar energy is the cheapest form of energy with technology being increasingly available and the absence of external costs to the environment and people inherent in coal energy. “It is about time the Philippines discussed its energy future realistically and scientifically. The government must heed the call of communities and adhere to facts, not the whims of large coal corporations that keep the promise of transformative energy an illusion,” Arances said. “Considering that the real price of coal far outweigh the so-called benefits of fossil-fuel-based technology, there can be no reasonable justification for the Department of Energy’s endorsement of more coal projects,” he said. “It can only be described as coal addiction.”
For people and planet
Rodne Galicha of the Climate Reality Project said the fact that investments for RE in the country are increasing means businesses realize that it is both good for the people and the planet. “ The main problem we are facing in the countr y is the denial of some decision-makers on the reality of our capacity to shift from dirty, big coal to cleaner-energy sources, such as hydropower, geothermal, wind and solar. Let’s put a price on denial, let’s put a price on ever y ton of carbon dioxide emitted by the energ y sector. This kind of ta x can be refunded to the
energ y producer as renewable reinvestment,” he said. Quoting Pete H. Maniego, a senior policy advisor of the Institute for Climate and Sustainable Cities, Galicha said RE can sustain the country’s bid for industrialization. He said indigenous RE sources can support and promote industrialization and, in fact, can be the anchor of the government’s industrial policy. Maniego had said that to be energy-secure and self-sufficient, the Philippines must give utmost priority to reducing its reliance on imported fuels. The Philippines imports more than 80 percent of its coal requirements, with 70 percent coming from Indonesia. In 2015 the country imported 15 million tons of coal worth $800 million from Indonesia alone. According to Galicha, the Climate Reality Project supports the passage of Senate Bill 251, or the proposed Low Carbon Economy Act filed by Sen. Loren Legarda. It establishes the emission cap-and-trade system in the industry sector to reduce greenhouse-gas emissions and protect the climate. “There is an urgent need for the Philippine government to look at the benefits of the Paris Agreement to our communities and the planet. We call on the Senate to, once and for all, act with a sense of urgency and do the right thing. We are glad that it has been announced publicly that the climate pact will be ratified by July, however, why not as soon as possible?” Galicha said. He said that to hasten the RE development in the Philippines, a one-stop shop with lower transaction costs for RE investments and projects must be established by concerned government agencies. He noted that there are tons of documents that investors need to file to make RE projects rolling— from permits to regulatory and operational stages. RE advocates say that for the Philippines to achieve a sustainable development path, a shift to RE should start, and coal addiction must first stop.
Biodiversity Monday BusinessMirror
Asean Champions of Biodiversity Media Category 2014
Monday, January 30, 2017 A13
Editor: Lyn Resurreccion • www.businessmirror.com.ph
LGUs urged to adopt local biodiversity action plans
A
n official of the Department of Environment and Natural Resources (DENR) on Thursday urged local government units (LGUs) to adopt and implement the Philippine Biodiversity Strategy and Action Plan (PBSAP) 2016-2028 by integrating it in their respective development agenda. Director Theresa Mundita S. Lim of the DENR’s Biodiversity Management Bureau (BMB) underscored the need for LGUs to adopt their localize action plans to protect and conserve the country’s biological diversity, which she said is key to sustainable growth and development. “Protecting our natural wealth ensures that everybody will continue to enjoy the ecosystems services provided by a healthy environment,” Lim said. She said by integrating the PBSAP into the local development agenda, LGUs will be a big boost to local economic development. She cited the importance of enhanced protection of areas reserved for conservation, such as protected areas (PAs), which are considered key biodiversity areas (KBAs). PAs are host to critical watersheds and home to unique species of plants and animal wildlife. Watersheds provide clean and safe freshwater supply for irrigation, for domestic, commercial and industrial use, she said. Protecting the country’s biodiversity, Lim said, entails huge cost where LGUs’ can play a big role. Last Monday the DENR and the United Nations Development Programme (UNDP) launched the Localization of PBSAP and Biodiversity Financing Initiative (Biofin) Project at the House of Representatives. The project will be pilot-tested in Occidental and Oriental Mindoro with the backing of its local officials. During the project’s launch, Rep. Josephine Ramirez Sato of Occidental Mindoro expressed her support to the UNDP-DENR initiative and vowed to champion biodiversity conservation. A member of the House of Representatives committee on ecology, Sato is the legislative champion of Biofin. The PBSAP is the country’s blueprint to protect and conserve its rich biodiversity. The plan lists 113 actions that cover nine thematic areas, including forest, coastal and maritime areas, inland waters, cave and cave systems, protected areas, agro-biodiversity, urban biodiversity, invasive alien species and access and benefitsharing. It lists more than 50 national and attached agen-
cies as responsibility centers supported by other sectors in society, such as academe, local governments and civil society. While the Philippines is committed to protecting and conserving its rich biodiversity as a signatory to the Convention on Biological Diversity (CBD), much needs to be desired in terms of financing as reflected in its annual budget allocation. Implementing the PBSAP will cost the government P24 billion a year from 2017 to 2028. Current spending of the Philippines for biodiversity conservation stands at P5 billion a year, leaving a financing gap of P19 billion. Biofin has estimated that ecosystem services in the Philippines amount to P2.3 trillion a year. Ecosystem services include timber and fuel-wood production, water provision, ecotourism, carbon offset, flood prevention, soil erosion, fishery production, crop production and benefits derived from coral reefs and mangrove. Biofin is testing the finance mechanism, such as budget realignment, private-sector engagement and accessing earmarked funds. “The repercussions of biodiversity loss are much more expensive than the cost of sustaining, protecting and managing biodiversity. Now more than ever, we need to view biodiversity as an investment that can deliver significant economic and social returns. It is an investment that needs to be made by both government and the private sector. We commend the local officials of the province of Mindoro for taking on the challenge and are now leading the efforts to narrow the financing gap in biodiversity protection and conservation, one province at a time,” UNDP Country Director Titon Mitra said in a statement. Sato, a former governor of Occidental Mindoro, along with Mitra, Environment Secretary Regina Paz L. Lopez, Oriental Mindoro First District Rep. Paulino Salvador C. Leachon, Oriental Mindoro Second District Rep. Reynaldo V. Umali, Occidental Mindoro Gov. Mario Gene J. Mendiola and Oriental Mindoro Gov. Alfonso V. Umali Jr., will sign the declaration of cooperation in support of the localization of the PBSAP 2015-2028. “Being an island endowed with rich natural resources and a host of unique species of plants and animal wildlife, Mindoro and the people living on the island have everything to gain out of this initiative,” Sato said. Jonathan L. Mayuga
Demolition of illegal fish pens and cages in Laguna Lake on Thursday. DENR Strategic Communication and initiative Service
Secretary Nereus Acosta on his way out of LLDA; ex-Pateros mayor takes over
Massive demolition of Laguna Lake fish cages, pens begins
T
By Jonathan L. Mayuga
@jonlmayuga
he government has embarked on a massive demolition of illegal fish pens and fish cages in Laguna de Bay on Thursday.
Environment Undersecretary Art Valdez, who is also the National Anti-environmental Crime Task Force (NAECTF) head, said as of 1 p.m. on Thursday around 100 hectares of the lake’s surface were cleared of fish cages and fish pens. This came as Secretary Nereus Acosta is on his way out of the Laguna Lake Development Authority (LLDA) by the end of the month. Sources said former Pateros Mayor Jaime Medina, President Duterte’s anointed official to the LLDA, has started to make his presence felt as early as Monday. An agency attached to the Department of Environment and Natural Resources (DENR), the LLDA’s mandate includes regulating and planning the development within the Laguna de Bay area. A source from the LLDA said Medina got Duterte’s nod and appointment upon the recommendation of top DENR officials. “He [Medina] was recommended by Undersecretary Art Valdez. Last Monday, Acosta bade goodbye to employees of the LLDA,” the source said. Interviewed by the BusinessMirror, Valdez, however, said he did not recommend Medina, but confirmed that the former Pateros mayor will be joining a massive demolition operation targeting
100 ha
The area of the lake’s surface that was cleared of fish cages and fish pens illegal fish cages and fish pens within the Laguna de Bay’s portion in Binangonan, Rizal. The operation was jointly conducted by the NAECTF, the Philippine National Police (PNP), Philippine Coast Guard (PCG) and the National Bureau of Investigation (NBI), Valdez said. The LLDA source said Medina had a meeting with the Executive Committee (Execom) of LLDA on Wednesday. Acosta confirmed to the BusinessMirror that he is giving way to Medina by the end of the month. “Yes, I am turning over the leadership to Mayor Medina by the end of the month,” Acosta said in a telephone interview. He said he expects the LLDA board of d irectors to meet and formally accept Medina’s nomination to the LLDA with Duterte’s appointment. “It is all for formality. The LLDA board will meet and accept
[former] Mayor Medina’s appointment,” said Acosta, who held the position of LLDA general manager for five years and six months. Acosta said the order from Ma lacañang was ex pected. For the meantime, the for mer lawma ker from Buk idnon said he w i l l concent rate on projects and partner w ith academe, and attend to family affairs. “I am not surprised at all,” said Acosta, who thanked Duterte for allowing him to hold over the position for seven more months after the assumption of the new administration in June last year. “I am in a holdover capacity for more than seven months,” Acosta said, adding that he has been preparing to leave the LLDA for months even before the May 2016 elections. Acosta’s relief came in the wake of criticisms of the LLDA’s failure to address the mushrooming of illegal fish cages and fish pens within the 90,000-hectare Laguna de Bay, the country’s biggest freshwater lake and aquaculture hub in Luzon. Former Manila Mayor and now Party-list Rep. Lito Atienza of Buhay criticized Acosta for the proliferation of the illegal fish cages and fish pens in the area. A former DENR secretary himself, Atienza failed to enforce his own “zero fish cage” policy during his stint as chief steward of the state environment agency during the Arroyo administration. Last December Environment Secretary Regina Paz L. Lopez ordered a one-year moratorium on fish-cage and fish-pen operators in order to execute Duterte’s order to decongest the lake and allow small
fishermen to have greater access to their traditional fishing grounds. She said the DENR will give the fish-cage and fish-pen operators time to harvest their stock and voluntarily demolish their structures so they could recover their construction materials. On Thursday, however, the NAECTF, backed by law enforcers from the PNP, PCG and NBI, started the massive demolition. Valdez said they intended to remove illegal fish cages and fish pens from one town to the next, starting in Binangonan, Rizal. Two big patrol vessels and a dozen speedboats will be deployed, signaling the start of the demolition. “This will be massive demolition. There will be no letup,” he said. According to Valdez, clearing the lake of obstructions will take time because the expanse of surface water is covered with fish cages and fish pens. Around 13,000 hectares of the lake’s surface, way above the 10-percent capacity of the lake as mandated by the Fisheries Code of the Philippines, is occupied by fish cages and fish pens. Most of the fish-cage and fishpen operators are agricultural companies, big cooperatives or moneyed and influential individuals with ties to local government officials within the Laguna de Bay area. One fish-pen operator, according to Lopez, operates 50 hectares of fish-pen. Besides limiting small fishermen from fishing in supposedly open waters, massive operation of fish cages and fish pen is partially being blamed for the degradation of the lake’s environment.
WWF envoys, Pascual Lab teach kids on climate change, health
T
he classrooms of the Genera l Rox as Element a r y School in Quezon City are abuzz with the chitter-chatter of nearly 100 students, discussing ideas and listening to World Wide Fund for Nature (WWF)-Philippines National Ambassadors Marc Nelson, Rovilson Fernandez, plus a team of environmental educators from WWF-Philippines and Pascual Laboratories. “Can you guys name all the vegetables in the song ‘Bahay Kubo’?” asks Rovilson, alluding to a popular Filipino children’s song. “Regularly eating vegetables can build up your immune system and shield you from cough, colds and other sicknesses brought on by stronger typhoons,” he explains.
In the next classroom Marc is explaining how climate change is exacerbated by the burning of fossil fuels. “Sw itching to renewable-energ y sources, like wind power and solar parks, can stop global warming,” he says as the other teachers hand out climate-change brochures. The duo recently participated in WWF and Pascual Laboratories’ Sowing to Empower, Educate and Develop (SEED) Programme, which aims to enhance local communities’ resilience to climate change by eliminating diseases and switching to healthier lifestyles through a proper diet, exercise, vitamins and good hygiene. For the past five years, the program has taught thousands of elementary-school students about
Through the Sowing to Empower, Educate and Develop Programme, WWF and Pascual Laboratories have been working since 2012 to empower Filipino communities to fight climate change. Gregg Yan/WWF
the vital link between climate change and health. Health conditions and diseases, like asthma, heatstroke, leptospirosis, typhoid fever, cholera and so forth, are spurred by climate change. A study released in 2012 by
the New York Academy of Sciences shows how climate change can dramatically spread vectorborne diseases, such as malaria, to many areas. The World Health Organization estimates that climate shifts are responsible for 6
percent of global malaria cases and that many communities in Asia and Africa are unprepared for more disease outbreaks. “The floods caused by rains or the incessant summer heat can drive up incidences of leptospirosis or heat stroke,” explains WWF-Philippines Environment a l Educator Dino C a lderon, who also taught 80 of the students’ parents during the learning drive. By simply washing our hands or remembering to hydrate before we go out of our homes, we can bolster our resilience to climate change. Our aim is simple—to promote better health via a better environment.” The education sessions were held early this month for nearly 200 graders and parents from the
General Roxas Elementary School. Pascual Laboratories’s Mia Pascual- Cenzon said: “ We cannot overemphasize the role of education in improving people’s lives. We are a poor countr y and are ver y v ulnerable to climate change. By educating the next generation of kids, we can inculcate the right values to allow them to adapt and help stop climate change. We’ve been doing this for five years and we hope that our partnership w ill have an impact on the lives of our students.” Rovilson reminded the students, “Don’t forget to pick up your trash and throw them into the proper waste bins. Small acts can make a big difference when we work together.”
A14 Monday, January 30, 2017 • Editor: Angel R. Calso
Opinion BusinessMirror
editorial
Are bloggers real press people?
T
he Internet has made getting information and being informed much easier. What used to mean a trip to the library or the newsstand has been replaced by going online. The proliferation of smartphones has made access to information even more convenient, as information and news are now at your fingertips.
Users can download news applications on their phones to get the latest news, or they can “follow” their favorite news outlets on their social-media pages. Through social media, both legitimate and false news are relayed at the speed of light countless times. However, we know that a substantial portion of this passed-on information may not be verified at any point in the transmission chain, leading to so-called fake news. While this may be a problem, perhaps a greater concern is what qualifies as a genuine news source. We speak of the traditional press and media, and the new digital media. The fact is that content is mostly the same, and it is only the platform for delivery that has changed. Notice that virtually all “traditional” press and media also dispense their content through digitals methods. Entering the picture is a third force broadly know as “bloggers”— writers or group of writers who blog about their own experiences, observations and opinions. Being outside the realm of either the traditional or digital press, bloggers often think of themselves as “influencers” rather than pure news outlets. Nonetheless, all press and media would like to think of themselves as opinion-shapers. But should bloggers be given the same recognized access to government press briefings and the like as those being given to traditional and digital press and media? US First Lady Melania Trump prevailed on Friday in the first round of a $150-million libel suit she filed against a Maryland blogger over a report he published last summer about claims that Trump worked as a “high-end escort”. Included in the lawsuit is the US affiliate of London’s Daily Mail newspaper that published a similar account. A court has ruled the lawsuit can progress, as the content was beyond a citizen’s right to freely speak out on issues of public concern. Both the blogger and the Mail retracted their articles. Both also insisted they were merely reporting “widely known” rumors. Except, there is no evidence of the rumors being widely known, until the blogger’s post and the Daily Mail article. Malacañang Press Corps officers were asked if bloggers could be accredited as members of the Palace press corps. The officers said no. Some free-speech advocates would say yes. But that has nothing to do with the issue. Real or perceived bias, prejudice, partisanship or favoritism is not important either to be legitimate. It simply comes down to two factors: transparency and accountability. Every legitimate press and media outlet is happy to clearly indentify who is in charge and who is paying the bills. They also provide a physical location if legal action ever needs to be taken to address their accountability. There is nothing inherently flawed with other forms of press and media being considered part of the “real” press. But anyone who wants to play in the game must be required to play by the same rules. Since 2005
BusinessMirror A broader look at today’s business ✝ Ambassador Antonio L. Cabangon Chua Founder
Publisher Editor in Chief Managing Editor Associate Editor News Editor City & Assignments Editor Senior Editors
S
ocioeconomic Planning Secretary Ernesto M. Pernia on Thursday released a report on the performance of the Philippine economy for the last quarter of 2016. He said the economy grew by 6.6 percent, supported by higher investment and consumption. Pernia was optimistic: It “is testament that our economy remains robust, and is growing at a healthy and steady pace”.
It was mostly good news for the economy, with the country’s average full-year growth at 6.8 percent, which is right on target because the government was looking at 6-percent to 7-percent growth rate for last year. It is good to note, too, that this 6.8-percent growth is the country’s strongest in three years, and has actually made the Philippines the fastest-growing economy in Asia. This growth also brings the country’s seven-year moving average of real
GDP growth rate to 6.3 percent—the highest since 1978. For the current year, Pernia is confident that the GDP will grow anywhere from 6.5 percent to 7.5 percent, despite some risks. These risks include extreme weather disturbances, greater volatility in capital flow and the possible changes in policy under the Trump administration. According to National Economic and Development Authority Deputy Director General Rosemarie G.
Lorenzo M. Lomibao Jr., Gerard S. Ramos Lyn B. Resurreccion, Efleda P. Campos
Creative Director Chief Photographer
Eduardo A. Davad Nonilon G. Reyes Judge Pedro T. Santiago (Ret.) Benjamin V. Ramos Adebelo D. Gasmin Marvin Nisperos Estigoy Aldwin Maralit Tolosa Dante S. Castro
Publishing, Inc., with offices on the 3rd floor of Dominga Building III 2113 Chino Roces Avenue corner De La Rosa Street, Makati City, Philippines. Tel. Nos. (Editorial) 817-9467; 813-0725. Fax line: 813-7025. (Advertising Sales) 893-2019; 817-1351, 817-2807. (Circulation) 893-1662; 814-0134 to 36. E-mail: news@businessmirror.com.ph.
www.businessmirror.com.ph
Printed by brown madonna Press, Inc.–San Valley Drive KM-15, South Superhighway, Parañaque, Metro Manila
For 2017, Secretary Pernia is confident that the GDP will grow anywhere from 6.5 percent to 7.5 percent, despite some risks. These risks include extreme weather disturbances, greater volatility in capital flow and the possible changes in policy under the Trump administration.
Edillon, it will be the areas of tourism, government investment, construction and manufacturing that will drive the growth in 2017. nnn
According to the Chinese calendar, 2017 is the Year of the Fire Rooster. The Rooster is the 10th, out of the 12, animal in the 12-year Chinese zodiac cycle. The Chinese believe people will be more polite and less stubborn this year. However, they may have the tendency to complicate things. It is a time that is geared toward progress, honor and integrity.
Accounting ethics: What’s that?!
T
Courage is also needed in some cases when it comes to declaring the truth. An accountant, as a professional, must be prepared to resign his livelihood, if necessary, if the alternative is that he has to do or cooperate with something contrary to his professional principles.
Pakaluk & Cheffers, in their text Understanding Accounting Ethics, make the following important claims, among others: (1) Accounting is a profession that has as its function the provision of the conditions of trust in a modern-market economy; (2) The virtues of an accountant may be derived through reflection on the distinctive role or function of an accountant; and (3) As a profession, accounting is in many respects the most altruistic and ethically demanding of the professions. The authors of Understanding Accounting Ethics wish to convince us that it is possible to derive the distinctive virtues of an accountant—or at least those that he ought to pos-
the truth. But something like courage is also needed in some cases, when it comes to declaring the truth. An accountant, as a professional, must be prepared to resign his livelihood, if necessary, if the alternative is that he has to do or cooperate with something contrary to his professional principles. Prudence, on the other hand, is that cardinal virtue that is the mold and “mother” of all the cardinal virtues, of justice, fortitude and temperance. Any man of action, and above all someone governing or leading a company, is using it constantly: he practices prudence in the management of his affairs; otherwise, he would not be able to survive. Prudence—sometimes called practical wisdom—is essential to governance
Aliza Racelis
Max V. de Leon Jennifer A. Ng Dionisio L. Pelayo Vittorio V. Vitug
Ruben M. Cruz Jr. Angel R. Calso
MEMBER OF
RISING SUN
Jun B. Vallecera
BusinessMirror is published daily by the Philippine Business Daily Mirror
HOM
Atty. Jose Ferdinand M. Rojas II
T. Anthony C. Cabangon
Online Editor Social Media Editor
Chairman of the Board & Ombudsman President VP-Finance VP Advertising Sales Advertising Sales Manager Group Circulation Manager
2016 figures prove robust Philippine economy
DEBIT CREDIT o some people, the term “accounting ethics” might sound like an oxymoron. “Managements are prepared to commit fraud, especially in times of crisis, right?” one might say. “Isn’t greed the foundation of business, as Gordon Gecko said.” another might retort.
sess—and that we can understand these virtues as analogues of the cardinal virtues (to wit: prudence, justice, courage and self-mastery). I wish to highlight only two of the virtues of an accountant that they discuss at length in the book: (1) courage and (2) prudence. Courage in an accountant typically takes the form of due diligence, that is, taking the pains necessary to find out something that you recognize that you do not yet know, but that you need to know in order to act as you should. The “stubbornness” that a practitioner needs to carry through and discover what needs to be known is a virtue analogous to courage. Now, due diligence has to do with seeking
Those born in the years of the Rat and the Ox are believed to be favored this year. The Rat people will enjoy happiness, including financial success. The Ox natives, on the other hand, will have unexpected success and positive unforeseen events. In celebration of the Chinese New Year—and if you would like to see something different at this time—do visit the art exhibit of the Chan Lim Family of Artists and Students at The Block Atrium in SM City North Edsa. The exhibit of exquisite plates and scrolls will run until February 12. On exhibit are 100 beautifully designed handpainted scrolls and 144 plates. The centerpiece is “a grand Chinese pagoda accentuated with Chinese oil painting of koi, which symbolize success, prosperity, longevity, courage, ambition and perseverance.” The artistic members of this Chinese family have been using fans, lanterns, scrolls and porcelain plates as their canvas. To BusinessMirror readers who are celebrating the Chinese New Year this week, Gung Hei Fat Choy! San Tai Gin Hong!
and to the exercise of a profession. It is (this is the way philosophers of classical times called it) auriga virtutum, the charioteer of the virtues. It is the directive virtue. In his directing and governing, the mature person ought to be, with due information and with acquired habits, able to dominate what is novel, unexpected, or exceptional. Accumulated experience makes man capable of confronting the unexpected. Obviously, in practice it is quite difficult to avoid mistakes, because we are not omniscient, but prudence allows us to rectify. I understand that there are many who are sceptical about the value of ethics for accounting, including you who are reading this. I thank you, nevertheless, for reading all the way to this last line of the article: Hopefully, you will be more open to reading further columns that have “ethics” in their title. Dr. Aliza Racelis received her PhD in Business Administration (University of the Philippines Diliman) in April 2010. She is a Management Accounting and Business Ethics professor at the University of the Philippines Virata School of Business. This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.
Opinion BusinessMirror
opinion@businessmirror.com.ph
President Trump, meet my family
PPPs in a low- or high-trust society By Alberto Agra
PPP Lead
Nicholas Kristof
new york times
T
his newspaper has periodically, to its shame, succumbed to the kind of xenophobic fearmongering that President Donald J. Trump is now trying to make American policy.
In 1875 The Times sternly warned that too many Irish and German immigrants (like the Trumps) could “deprive Americans by birth and descent of the small share they yet retain” in New York City. In 1941 The Times cautioned in a front-page article that European Jews desperately seeking American visas might be Nazi spies. In 1942, as Japanese-Americans were being interned, The Times cheerfully suggested that the detainees were happily undertaking an “adventure”. We make bad decisions when we fear immigrants we “otherize”. That’s why Americans burned Irish Catholics alive; banned Chinese for decades; denied visas to Anne Frank’s family; and interned Japanese-Americans. And, yes, The New York Times sometimes participated in such madness. But we will not be part of that today. Trump signed an executive order (EO) on Friday that suspends refugee programs and targets Muslims from certain countries. It’s hypocritical for Trump to be today’s avatar of hostility to immigrants, since his own family suffered from antiGerman sentiment and pretended to be Swedish. But I’m indignant for a more personal reason—and I’m getting to that. Kirk W. Johnson, a former American aid official in Iraq, fears that the EO will bar military interpreters who have bled for America and to whom we have promised entry. He told me about one interpreter, nicknamed Homeboy, who ran through fire to rescue a wounded American soldier, and then was himself shot. Homeboy survived, barely, but lost his leg— and as he recovered, a grenade was thrown at his home by insurgents angry that he had helped Americans. After years of vetting, Homeboy was approved for a visa for interpreters who helped the United States. Does Trump really want to betray such people who risked more for America than Trump himself ever did? Yet, if fear and obliviousness have led us periodically to target refugees, there’s also another thread that runs through American history. It’s reflected in the welcome received by somebody I deeply admire: Wladyslaw Krzysztofowicz. And this is personal. Raised in what was then Romania and is now Ukraine, Krzysztofowicz was jailed by the Gestapo for assisting an anti-Nazi spy for the West. His aunt was murdered in Auschwitz for similar spying, but he was freed with a bribe. When World War II was ending, he fled his home as it fell into the hands of the Soviets. After imprisonment in a Yugoslav concentration camp, he made it to Italy and then France, but he couldn’t get a work permit, and he thought that neither he nor any children he
We make bad decisions when we fear immigrants we “otherize”. That’s why Americans burned Irish Catholics alive, banned Chinese for decades, denied visas to Anne Frank’s family and interned Japanese-Americans. And yes, The New York Times sometimes participated in such madness. But we will not be part of that today. might later have would ever be fully accepted in France. So he dreamed of traveling to America, which he had heard would be open to all. He explored a fake marriage to an American woman to get a visa, but that fell through. Finally, he met an American woman working in Paris who convinced her family back in Portland, Oregon, to sponsor him, along with their church, the First Presbyterian Church of Portland. As Krzysztofowicz stood on the deck of the ship Marseille, approaching New York Harbor in 1952, a white-haired woman from Boston chatted with him and quoted the famous lines from the Statue of Liberty, “Give me your tired, your poor, your huddled masses yearning to breathe free….” Krzysztofowicz spoke little English and didn’t understand, so she wrote them down for him and handed him the paper, saying, “Keep it as a souvenir, young man.” Then as she was walking away, she corrected herself: “young American.” Krzysztofowicz kept that scrap of paper and marveled that he—a refugee who had repeatedly faced death in the Old Country for not belonging—now somehow counted as an American even before he had set foot on American soil, even before he had learned English. It was an inclusiveness that dazzled him, that kindled a love for America that he passed on to his son. That strand of hospitality represents the best of this country. The church sponsored Krzysztofowicz even though he wasn’t a Presbyterian, even though he was Eastern European at a time when the Communist bloc posed an existential threat to America. He could have been a spy or a terrorist. But he wasn’t. After arriving in Oregon, he decided that the name Krzysztofowicz was unworkable for Americans, so he shortened it to Kristof. He was my dad. Recently, I returned to the First Presbyterian Church to thank the congregation for taking a risk and sponsoring my father, who died in 2010. And the church, I’m delighted to say, is moving to support a refugee family this year. Mr. President, please remember: This is a country built by refugees and immigrants, your ancestors and mine. When we bar them and vilify them, we shame our own roots.
Continued from A1
I
N a high-trust society, you believe that if you leave behind your latest cell phone or laptop unattended in a mall, you will find it in the same place or in the lost-and-found station, and whoever sees it will not keep it for himself or herself. In a low-trust society, you know and feel, despite fervent prayers, that most likely, your valuable possession will not be there and, in all likelihood, someone will take it.
In elections, in a high-trust society, you trust that your vote is counted, that one’s vote is his or her own, and the outcome of the political exercise truly reflects the
will of the people. Conversely, in a low-trust society, there is a need for hundreds of poll watchers, padlocks for ballot boxes and 30 copies of election returns for government
Cyberlibel Atty. Lorna Patajo-Kapunan
legally speaking
R
epublic Act (RA) 10175, the Cybercrime Prevention Act of 2012 (cybercrime law), was approved on September 12, 2012. The cybercrime law aims to regulate access to and use of the cyberspace, a system that accommodates millions and billions of simultaneous and ongoing individual accesses to and uses of the Internet.
Cyberspace satisfies the insatiable need of the millennial generation for greater information and facility of communication. Using his laptop or computer, a person can connect to the Internet, a system that links him or her to other computers and enables him, among other things, to access virtual libraries and encyclopedias for all kinds of information; post billboard-like notices or messages, including pictures and videos, for the general public or for special audiences; advertise and promote goods or services and make purchases and payments; inquire and do business with institutional entities; communicate in writing or by voice with any person through his e-mail address or telephone. But, as pointed out by Supreme Court (SC) Justice Roberto A. Abad in Disini v. Secretary of Justice (GR 203335, February 11, 2014), all is not well with the system, since it cannot filter out a number of persons of ill will who would want to use cyberspace technology for mischiefs and crimes. One of them can, for instance, avail himself or herself of the system to unjustly ruin the reputation of another or bully the latter by posting defamatory statements against him that people can read. A person’s image will instantly be tarnished by just one click of the mouse or of the “send” button. And because linking with the Internet opens up a user to communications from others, the illmotivated can use the cyberspace for committing theft by hacking into, or surreptitiously accessing, his bank account or credit card, or defrauding him through false representations. The wicked can use the cyberspace,
too, for illicit trafficking in sex or for exposing to pornography guileless children who have access to the Internet. Vandals, who just want to wreck or cause havoc to the computer systems and networks of indispensable or highly useful institutions, accomplish this by sending electronic viruses or virtual dynamites that destroy those computer systems, networks, programs and memories. The government certainly has the duty and the right to prevent these from happening and punish their perpetrators, hence the Cybercrime Prevention Act. Several petitions were filed in the SC, claiming that the means adopted by the cybercrime law for regulating undesirable cyberspace activities violate certain constitutional rights. The government asserted that the law merely seeks to reasonably put order into cyberspace activities, punish wrongdoings and prevent hurtful attacks on the system. Petitioners challenged the constitutionality of the provisions of the cybercrime law that regard certain acts as crimes and impose penalties for their commission, as well as provisions that would enable the government to track down and penalize violators. These provisions are on Illegal Access; Data Interference; Cyber-squatting; Identity Theft; Cybersex; Child Pornography; Unsolicited Commercial Communications; and Libel. Specifically, the petitioners dispute the constitutionality of both the Revised Penal Code (RPC) provisions on libel, as well as Section 4(c)(4) of the Cybercrime Prevention Act on cyberlibel. Article 353 of the RPC defines
A blunt and counterproductive travel ban By Mohamed A. El-Erian Bloomberg View
S
ome bold and simple policies have merit; Friday’s executive order (EO) that temporarily bans the citizens of certain countries from coming to the US, and stops indefinitely the entry of Syrian refugees, is not one of them. As designed and implemented, there are genuine doubts about the order’s effectiveness in meeting its stated objective of preventing terrorism. It also
risks a lot of collateral damage and unintended consequences that ultimately could prove counterproductive and harmful to national security, the economy, and America’s moral authority, values and standing in the world. Even the order’s merits as a domestic signal are in doubt, and it risks damaging the credibility and effectiveness of future policy initiatives from the White House. The travel ban is succinctly stated: “To protect the American people from terrorist attacks by foreign nationals
Monday, January 30, 2017 A15
admitted to the United States.” With immediate effect, it forbids entry for specified periods of time to citizens from seven countries (Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen). But this is an extremely blunt approach to an important issue. Early reports on its application suggest that even longtime holders of multiyear visas for the US, together with green card holders and dual nationals, are are being refused entry at airports or being prevented from boarding planes destined for America. This includes people who
have been living in the US legally for many years, have been vetted, and are productive and integrated members of their local communities. Judging by Google, which stated that more than 100 of its employees traveling abroad are impacted by the order, it also covers tax-paying US-based workers who productively contribute to national growth and, as of this weekend, were on business trips or holidays abroad. They may now be stranded. It is not clear whether the travel ban also applies to those working at
agencies and political parties. In PPPs, there are four sets of stakeholders—government implementing agencies, the private-sector proponents (PSPs), regulatory agencies and us, the consumers, taxpayers and end-users. PPP, being relational, must be imbued with trust. Trust or absence of trust will determine the success or failure of the PPP. In a high-trust society, we, the beneficiaries and the clients of a PPP arrangement, trust that the project will really benefit us; that government officials will not be corrupted; that bidders, proponents or challengers will not conspire with each other; that the PSP will meet its performance targets; that regulatory agencies will know how to calibrate between the interests of the PPP parties and the public; that other consumers will pay for what they use; and that civil-society organizations
will be cochampions of PPP. Where there is trust, all the four stakeholders will learn together, innovate together, act as stewards together, trust each other, so that the general welfare, our own welfare, will be “future-proofed” by PPPs. In a low-trust environment, there is a fear that the successor administration unilaterally modify or even cancel PPP contracts; that losing bidders will seek injunctions so that no one else can get the contract; that litigants will always doubt the integrity of the courts in issuing a fair decision; and that parties to a PPP will doubt every decision or procurement made. Trust cannot happen overnight. In a low-trust society, this will take years, possibly, 23. But this does not mean we should stop PPPs until all the stakeholders become trustworthy. The path to trust begins today.
libel as a public and malicious imputation of a crime, or of a vice or defect, real or imaginary, or any act, omission, condition, status, or circumstance tending to cause the dishonor, discredit, or contempt of a natural or juridical person, or to blacken the memory of one who is dead. The libel provision of the cybercrime law, on the other hand, merely incorporates the provisions of the RPC on libel. Thus, Section 4(c)(4) provides that cyberlibel is libel (as defined by the RPC) committed through a computer system or any other similar means that may be devised in the future. The SC in the Disini case held that libel is not a constitutionally protected speech, and that the government has an obligation to protect private individuals from defamation. Indeed, cyberlibel is actually not a new crime, since Article 353 of the RPC already punishes it. In effect, Section 4(c)(4) above merely affirms that online defamation constitutes “similar means” for committing libel. The SC ruled that only the original author (blogger) should be penalized for the libelous article, blog or statement, noting that the culture associated with Internet media is distinct from that of print According to the 2011 Southeast Asia Digital Consumer Report, cited in Disini v. Secretary of Justice (supra), 33 percent of Filipinos have accessed the Internet within a year, translating to about 31 million users. Based on a recent survey, the Philippines ranks sixth in the Top 10 most engaged countries for social networking. Social-networking sites build social relations among people who, for example, share interests, activities, backgrounds, or real-life connections. In the cyberworld, there are many actors: a) the blogger, who originates the assailed statement; b) the blog service provider, like Yahoo; c) the Internet service provider, like PLDT, Smart, Globe, or Sun; d) the Internet café that may have provided the computer used for posting the blog; e) the person who makes a favorable comment on the blog; and f) the person who posts a link to the blog site. Should the blogger post a malicious and defamatory statement on social networking, like “President DU30 is concealing
a life-threatening cancer,” and a reader and his friends and fellows avail themselves of any of the “Like”, “Comment” and “Share” reactions, would they be guilty of aiding and abetting libel? The SC in the Disini case stressed that, except for the original author of the assailed statement, the rest (those who pressed Like, Comment and Share) are essentially kneejerk sentiments of readers who may think little or haphazardly of their response to the original posting are not liable for aiding and abetting libel. The SC also considered the inherent impossibility of joining hundreds or thousands of responding “friends” or “followers” in the criminal charge to be filed in court. In sum, the SC in the Disini case declared that Section 4(c)(4) of RA 10175, the cybercrime law, that penalizes online libel, is valid and constitutional, with respect to the original author of the post; but void and unconstitutional, with respect to others who simply receive the post and react to it. The implementing rules and Regulations of RA 10175 reiterated the pronouncement made in the Disini case by the SC that in cases of Internet libel, only the original author of the post or online libel may be held liable and not the others who simply receive the post and react to it. The penalty for cyberlibel is prision correccional in its maximum period to prision mayor in its minimum period, or a fine ranging from P6,000 up to the maximum amount determined by the Court, or both, in addition to the civil action that may be brought by the offended party. Under the cybercrime law, the penalty for online libel is one degree higher compared with print libel. Indeed, the right of free speech is not absolute at all times and under all circumstances. The lewd and obscene, the profane, the libelous, the malicious, the insulting, the angry and fighting works—which by their very utterance inflict injury, foment dispute, tend to incite an immediate breach of the peace— are all forms of expression not protected by our Constitution. And if done in cyberspace, where reputations can be tainted and damaged with just one click, it is right that the penalty should be stiffer than traditional libel.
the international institutions that the US hosts, including the International Monetary Fund and the World Bank. The uncertainty is enough to stop some staff from traveling abroad on business, thereby reducing the effectiveness of these institutions. Then there are the students at US educational institutions, some of whom are still in the process of returning for their new terms. No wonder so many people from across the political spectrum are questioning the EO—and deploring its highly discriminatory nature and
the related threats to what makes the US so special and so admired. The ban risks undermining the US’s moral authority, along with its standing and the respect it commands. In turn, this can undermine the credibility of President Donald J. Trump’s administration, creating potential headwinds to the effectiveness of its future measures in a wide range of areas. I suppose that some may feel that all this would be warranted if the ban can deliver on its objective. But here, too, there are problems.
2nd Front Page BusinessMirror
A16
Monday, January 30, 2017
www.businessmirror.com.ph
DOT launches Madrid Fusión Manila 2017 By Ma. Stella F. Arnaldo
M
@akosistellaBM Special to the BusinessMirror
ADRID—The Philippines’s Department of Tourism (DOT) recently made a successful pitch to an international gathering of chefs, culinary experts, food enthusiasts and media for the upcoming Madrid Fusión Manila 2017 (MFM 2017). In the morning, participants at the ongoing Asisa Madrid Fusión 2017 (AMF 2017) at the Palacios Municipal de Congresos were invited by the DOT and MFM organizer Foro Debate to support the Manila event, scheduled from April 6 to 8, at the SMX Convention Center in Pasay City. In the evening, a cocktail reception at Tatel restaurant was hosted by the government agency to also launch this year’s MFM, featuring an array of Filipino talents of international caliber. In her speech at the AMF 2017, DOT Director for Market Development Verna Esmeralda Buensuceso said the annual Madrid event, now in its 15th year, has inspired “current and future generations of chefs
and food enthusiasts to constantly innovate. We, in the Philippines, are living testament to this.” She added that, since the first edition of MFM (www.madridfusionmanila.com), “our culinary industry has awakened, and our chefs and students have been inspired by the knowledge imparted and shared by the best chefs of the world. As a result, a number of chefs associations have been born in many parts of our country. Our young Philippine chefs who joined the Food Hotel Asia Culinary Competition in 2016 in Singapore was declared overall champion, besting teams from 15 countries around the world.” The theme for the “third serving” of the MFM “is relevant to
the times. [It] will focus on, ‘Our Sustainable Gastronomic Planet,’” Buensuceso said. She promised an “exciting international gastronomy congress, an equally interesting Fusión Manila International Gastronomy Expo, and an actionpacked Flavors of the Philippines calendar of diverse culinary events that will kick off in mid-March and run the whole month of April, spanning the entire country.” “We are counting on you to join us as we sustain our efforts to establish the Philippines as a center of gastronomy in Asia,” she appealed to the gathering. “Three years ago, when we were starting this project, the world barely knew about the cuisine and ingredients the Philippines had to offer. Today food forecasts for 2017 name Philippine cuisine as the next big food trend. And many articles have been written worldwide about how the food scene in the Philippines is heating up.” In the evening, guests at the MFM 2017 cocktail reception included the likes of Elena Arzak, named World’s Best Female Chef in 2012; two-Michelin-starred chef Andoni Luis Aduriz; as well as diplomats, journalists and socialmedia inf luencers. Arzak and Aduriz were guest speakers at the first edition of the MFM. Along with brief remarks from Philippine government officials
enjoining the guests to support the Manila event, the packed crowd at the popular Tatel restaurant enjoyed the performances of the Sindaw group, beat boxer Neil Llanes and the winning bartending skills of Denis Barela. The restaurant is a well-known downtown dining destination, and is co-owned by singer Enrique Iglesias, basketball players Pau Gasol and Rudy Fernández, and tennis superstar Rafa Nadal. Several international Michelin-starred chefs
will be making presentations at the MFM 2017: Gert de Mangeleer (Hertog Jan, 3 Michelin stars); Jordi Roca and Alejandro Rivas (El Callar dela Roca, 3 Michelin stars); Rodrigo de la Calle (El Invernadero, 1 Michelin star); Regis Marcon (Regis and Jacques Marcon, 3 Michelin stars); Pedro Subijana (Akelare, 3 Michelin stars); Paco Perez (Miramar, 2 Michelin stars); Julien Royer (Odette, 2 Michelin stars); Magnus Ek (Oaxen Krog & Slip, 2 Michelin stars); Akrame
Bennalal (Akrame, 1 Michelin star); Simon Rogan (L’Endurne, 2 Michelin stars); and Kamilla Seidler and Michaelangelo Cestari (Gustu, 1 Michelin star). Other presenters, including popular Filipino chefs, such as Robby Goco (Green Pastures); Jordy Navarra (Black Sheep/Toyo Eatery); and Gene Gonzalez (Café Ysabel); as well as Tatiana and Kattia Levha (La Servan); and Filipino-American pastry chef Sally Camacho Mueller.
NEW WAVE This January 27 photo shows Mitsubishi Corp. General Manager Tomoyuki Takagi (from left), Isuzu Philippines Corp. (IPC) President Hajime Koso, Isuzu New D-Max brand ambassador and actor Derek Ramsay, IPC Executive Vice President Shohiro Sakoda and Isuzu Motor Corp. President International Operation-Thailand Yoichi Masuda waving at the grand launch of the Isuzu D-Max X-Series at the BHS Amphitheater in Bonifacio Global City, Taguig City. NONIE REYES
Judge suspends Trump order; bars deportation of refugees W
ASHINGTON—A federal judge in Brooklyn came to the aid of scores of refugees and others who were trapped at airports across the United States on Saturday, after an executive order signed by President Donald J. Trump, which sought to keep many foreigners from entering the country, led to chaotic scenes across the globe. The judge’s ruling blocked part of the president’s actions, preventing the government from deporting some arrivals who found themselves ensnared by the presidential order. But it stopped short of letting them into the country or issuing a broader ruling on the constitutionality of Trump’s actions. The high-stakes legal case played out on Saturday amid global turmoil, as the executive order signed by the president on Friday afternoon slammed shut US on borders for an Iranian scientist headed to a lab in Massachusetts, a Syrian refugee family headed to a new life in Ohio and countless others across the world. Trump—in office just a week— found himself accused of constitutional and legal overreach by two Iraqi immigrants, defended by the American Civil Liberties Union (ACLU). Meanwhile, large crowds of protesters turned out at airports around the country to denounce Trump’s ban on the entry of refugees and people from seven predominantly Muslim countries. Lawyers who sued the government to block the White House order said the judge’s decision could affect an estimated 100 to 200 people who were detained upon arrival at US airports. (See related story on A9.) The president’s order, enacted with the stroke of a pen at 4:42 p.m. on Friday, suspended entry of all refugees to the US for 120 days, barred Syrian refugees indefinitely and blocked entry into the US for 90 days for citizens of seven predominantly Muslim countries: Iran, Iraq, Libya, Somalia, Sudan, Syria and Yemen.
Judge Ann M. Donnelly of US District Court in Brooklyn, who was nominated by former President Barack Obama, ruled just before 9 p.m. that implementing Trump’s order by sending the travelers home could cause them irreparable harm. She said the government was “enjoined and restrained from, in any manner and by any means, removing individuals” who had arrived in the US with valid visas or refugee status. The ruling does not appear to force the administration to let in people otherwise blocked by Trump’s order who have not yet traveled to the US. The judge’s one-page ruling came swiftly after lawyers for the ACLU testified in her courtroom that one of the people detained at an airport was being put on a plane to be deported back to Syria at that very moment. A government lawyer, Gisela A. Westwater, who spoke to the court by phone from Washington, said she simply did not know. Hundreds of people waited outside of the courthouse chanting, “Set them free,” as lawyers made their case. When the crowd learned that Donnelly had ruled in favor of the plaintiffs, a cheer went up in the crowd. Minutes after the judge’s ruling in New York City, another judge, Leonie M. Brinkema in US District Court in Virginia, issued a temporary restraining order for a week to block the removal of any green card holders being detained at Dulles International Airport. Around the nation, security personnel at major international airports had new rules to follow, although the application of the order appeared chaotic and uneven. Humanitarian organizations delivered the bad news to overseas families that had overcome the bureaucratic hurdles previously in place and were all set to travel. And refugees on flights when the order was signed on Friday found themselves detained upon arrival. “We’ve gotten reports of people
being detained all over the country,” said Becca Heller, director of the International Refugee Assistance Project. “They’re literally pouring in by the minute.” Earlier in the day, at the White House, Trump shrugged off the sense of anxiety and disarray, suggesting that there had been an orderly rollout. “It’s not a Muslim ban, but we were totally prepared,” he said. “It’s working out very nicely. You see it at the airports; you see it all over.” The Department of Homeland Security said the order barred green-card holders from those countries from reentering the US. In a briefing for reporters, White House officials said that green-card holders from the seven affected countries who were outside the US would need a case-by-case waiver to return. Legal residents who have a green card and are in the US should meet with a consular officer before leaving the country, a White House official, who spoke on the condition of anonymity, told reporters. Officials did not clarify the criteria that would qualify someone for a waiver, other than that it would be granted “in the national interest.” To many, the government hardly seemed prepared for the upheaval that Trump’s actions put into motion. There were numerous reports of students attending US universities who were blocked from returning to the US from visits abroad. One student said in a Twitter post that he would be unable to study at Yale. Another who attends the Massachusetts Institute of Technology was refused permission to board a plane. A Sudanese graduate student at Stanford University was blocked for hours from entering the country. Human-rights groups reported that legal permanent residents of the US who hold green cards were being stopped in foreign airports as they sought to return from funerals, vacations or study abroad. See “Judge,” A2