Businessmirror july 05, 2018

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n Thursday, July 5, 2018 Vol. 13 No. 264

7% growth seen with robust infra spending

By Rea Cu

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@ReaCuBM

HE Department of Finance (DOF) is confident about the economy expanding by 7 percent over the medium term on the back of the government’s infrastructure buildup or “Build, Build, Build” (BBB) program, with P8 trillion to P9 trillion invested for the rest of the Duterte presidency.

In the first five months of 2018, the government has been ​averaging close to P56 billion a month in spending on the BBB.

The BBB will create more jobs, attract investments and, finally, disperse growth to the countryside, the DOF stressed.

Finance Secretary Carlos G. Dominguez III, at a news briefing by the government’s BBB team in Tarlac City on Wednesday, cited

₧56B The average monthly government spending on “Build, Build, Build” in the first five months of 2018

estimates of the National Economic and Development Authority (Neda) that around 100,000 new jobs were generated in the first five months of the year through the BBB. He said that national government spending on infrastructure reached P281 billion in the first See “Growth,” A8

No country for the ‘tambay’ Rene E. Ofreneo

laborem exercens

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he concept of all citizens being equal under the law has become the accepted principle since the turn of the 20th century in countries that have embraced liberal democracy as a system of political governance. Accordingly, each human being must be treated equally and all are subject to the same laws of justice. This principle is called “legal egalitarianism.” This is reflected in the political slogan adopted by former Manila Mayor Alfredo Lim—“The law applies to all, otherwise none at all.”

Continued on A7

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HE Philippine franchising sector is expected to expand to as much as $24 billion by 2020, industry leaders said, as it is seen to overcome economic challenges brought about by the weakening peso and rising inflation rate.

The Philippine Franchise Association (PFA) is confident the industry will grow by at least 10 percent this year, and that it will stand firm in the face of an economy muddled in challenges. This will bring up the sector’s value to nearly $20 billion, from the $18.1 billion it posted last year.

PFA President Richard V. Sanz said if the franchising industry continues to grow at this rate, it will most likely hit $24 billion by 2020. “Last year was

Shopping is more fun in the PHL, say tourists

“Given the success rate, people want to put their money in hard times into something that is safe.

When you look at the success rate, [it is at] 90 percent—very attractive and high return—and that’s why franchising is very vibrant during hard times.”—Sanz

@alyasjah

$18.1 billion, so we’re projecting [that] by 2020, our revenues for the franchise sector is $24 billion,” he said in a news briefing on Wednesday.

Sanz said franchising is currently valued at 6 percent of the country’s GDP. This could still expand in the years to come, as he explained the industry is growing steadily at 10 percent annually. See photo on A3.

Continued on A8

PESO exchange rates n US 53.4320

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FRANCHISING TO GROW TO $24B BY 2020, BUCKING SLUMP IN OTHER SECTORS

By Elijah Felice E. Rosales

2016 ejap journalism awards

By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

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Shops at the Uptown Mall in Taguig’s Bonifacio Global City are seen in this file photo. According to the Department of Tourism’s Visitor Sample Survey, shopping—whether in sleek malls like Uptown or more low-end flea markets—topped the list of preferred activities by tourists visiting the country. ALYSA SALEN

ETAILERS, rejoice!

Shopping tops the list of tourist activities in the Philippines, a survey of foreign visitors last year by the Department of Tourism (DOT) showed.

The Visitor Sample Survey, a copy of which was obtained by the BusinessMirror, polled some 15,000 respondents from the top 12 tourist source markets of the country from January to December 2017.

They were asked the question: “What other activities did you actually do aside from the main purpose?”

Continued on A2

n japan 0.4832 n UK 70.5035 n HK 6.8110 n CHINA 8.0422 n singapore 39.1587 n australia 39.4595 n EU 62.2964 n SAUDI arabia 14.2474

Source: BSP (4 July 2018 )

A2 Thursday, July 5, 2018 • Editor: Vittorio V. Vitug

Lawmakers decry ‘climate of fear’ under Duterte

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ouse opposition lawmakers on Wednesday denounced what they called the growing climate of fear and breakdown of the rule of law in the country following the spate of unsolved killings, including the murder of two town mayors.

Ifugao Rep. Teddy Brawner Baguilat Jr. said the Philippine National Police (PNP) should recalibrate to address these crimes.

“There is a climate of fear engulfing us. Priests and mayors are being killed after indigenous peoples and the urban poor,” Baguilat said.

“I urge the Philippine National Police to recalibrate and even step up its law enforcement campaign and go after hired assassins,” he added.

The Ifugao lawmaker said the spike in the killings by unknown assailants to the ongoing so-called war against drugs has emboldened unscrupulous individuals to flout the law and kill alleged drug users and pushers.

“Because nobody is being arrested then the criminal elements feel that they can get away with anything, even going now as far as killing more high-profile individuals in broad daylight and in cold blood,” he said.

“Now they are selling their service cheap to anyone who holds a grudge without fear of being caught, and that is because they know or feel that there is really no commitment on the part of the authorities to go after them,” Baguilat said.

The gruesome murders of two mayors, Tanauan city, Batangas Mayor Antonio Halili and Mayor Ferdinand Bote of Gen. Tinio, Nueva Ecija, were done separately on Monday and Tuesday, respectively.

Rep. Edcel Lagman of Albay said whether Halili is involved in illegal drugs, it is “slandering the dead” for President Duterte to link without proof Halili’s murder to the drug trade.

“Duterte again justified the use of force in a society where the proliferation of the culture of violence seems to be encouraged and inveigled by the administration,” he said.

Also, the lawmaker said, the President’s proposal to arm barangay chairmen, which makes them veritable targets of criminals, fits the mold of this culture of violence.

“Duterte is also inculcating violence in the youth with his proposal to arm ROTC cadets to beef up his unsuccessful campaign against drugs and criminality,” he said.

While a gun may be for “selfdefense,” in most cases it is an assault weapon, an instrument of aggression and violence, Lagman added. Jovee Marie N. dela Cruz

The Nation BusinessMirror

Army thwarts IS-inspired terrorists’ attempt to seize municipal building in Maguindanao

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By Rene Acosta

@reneacostaBM

wo soldiers and a militiaman were wounded on Tuesday as combined military and police forces attacked a group of Islamic State (IS)-inspired local terrorists in Maguindanao and thwarted an attempt to occupy the seat of the municipal government of Datu Paglas in the province.

Members of a breakaway faction of the Bangsamoro Islamic Freedom Fighters (BIFF), led by Sulaiman Tudon, have already occupied houses and were holed out just about 500 meters from the municipal hall of Datu Paglas when policemen and soldiers carried out swift operations.

T he operations, which be -

gan at around 5 a.m. and lasted for about nine hours, were carried out by elements of the 1st Mechanized Infantry Brigade, the 33rd Infantry and the 4th Specia l Action Batta lion, according to 33rd IB commander Lt. Col. Harold Cabunoc.

Cabunoc, who led the attack, said troops engaged the terrorists

holed out in a cluster of concrete houses at Sitio Mopac, Barangay Poblacion, Datu Paglas.

“Supported by armored vehicles and infantry mortars, the house-to-house close quarter battle lasted about nine hours in an area that is located in the middle of a rice field,” he said.

During the nine-hour battle, two members of the 33rd IB identified as Cpl. Millard Bacatan and Pvt. Allan Cabildo were wounded along with militiaman Musa Kalim.

No civilians were reported hurt during the fighting, although at least 500 people fled their homes and sought refuge at an Army gym in Datu Paglas.

Air Force helicopters blasted the remaining BIFF positions at around 3 p.m. before clearing operations were initiated by the attacking forces, who recovered and detonated three homemade bombs that were laden along the course leading to the BIFF positions.

Let us prevent the terrorists from sowing chaos in urban centers to imitate the tactics that they used in Marawi last year. We must work closely with the civilian leaders in monitoring the enemy’s sinister plans in perpetrating violent actions to spoil the peace.”—Sobejana

“We confronted enemy snipers and improvised bombs as we seized the areas that are previously occupied by the terrorists.

We also wanted to contain the fighting outside of the highly populated area some 500 meters away,” Cabunoc said.

Augmentation forces were deployed by 6th Infantry Division commander Brig. Gen. Cirilito E. Sobejana to the battle scene, assuring he will never allow the BIFF to sow terror in Maguindanao.

“Let us prevent the ter rorists from sowing chaos in urban centers to imitate the tactics that they used in Maraw i last year. We must work closely with the civilian leaders in monitoring the enemy’s sinister plans in per petrating v iolent actions to spoil the peace,” Sobejana said.

Troops maintained security patrols within and the surrounding areas of Sitio Mapac in order to facilitate the return of the evacuees and ensure their safety.

SC: HDA Luisita fully compliant House bill proposes stiffer fine, penalty with order to pay farmers ₧1.33B on plastics use, improper waste disposal

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By Joel R. San Juan

@jrsanjuan1573

HE Supreme Court has declared the Cojuangco clan-owned Hacienda Luisita Inc. (HLI) as fully compliant with its order issued exactly seven years ago to distribute to 6,296 farmworker-beneficiaries (FWBs) the unspent balance from the P1.33-billion sale of three lots covered by the agrarian reform program, but sold to private and government entities in 1996.

In a 14-page resolution, the Court noted that the three members of an audit panel formed by the Department of Agrarian Reform (DAR) had determined that there is no longer any unspent or unused balance of the sales proceeds available for distribution to the farmer-beneficiaries.

In its decision issued on July 5, 2011, the Court directed HLI to pay the original 6,296 Hacienda Luisita FWBs the P500 million it received from Luisita Realty Inc. for the sale to the latter of 200 hectares out of the 500 hectares covered by the August 14, 1996, Conversion Order; the consideration of P750 million received by its subsidiary Centennary Holdings Inc., for the sale of the remaining 300 hectares of the 500-hectare lot to Luisita Industrial Park Corp.; and the P80.5 million paid by the government through the Bases Conversion and Development Authority for the sale of the 80.51-hectare lot used for the construction of the Subic-Clark-Tarlac Expressway road.

The Court also directed the DAR to tap the services of a reputable accounting firm approved by the parties to audit the books of HLI and Centennary Holdings Inc. to determine if the P1,330,511,500 proceeds of the sale of the three lots were actually used or spent for legitimate corporate purposes.

Any unspent or unused balance and any disallowed expenditures as determined by the audit, according to the Court, must be distributed to the 6,296 original FWBs.

“To sum up, all three members of the audit panel have determined that the legitimate corporate expenses of HLI for the years 1998 up to 2011, coupled with the taxes and expenses related to the sale of the 3-percent share already distributed to the FWBs, far exceeded the proceeds of the sale of the adverted 580.51-hectare lot,” the SC said.

Thus, it said there are no longer any unused proceeds that should be given out to the FWBs. The members of the audit panel include the firms of Ocampo, Mendoza, Leong and Lim and Navarro Amper & Co., and Certified Public Accountant Carissa May Pay-Penson.

The panel was specifically tasked to determine if the P1.33 billion “was actually used or spent for legitimate corporate purposes.”

In its July 5, 2011, decision, the Court affirmed the validity of the order issued by the Presidential Agrarian Reform Council (PARC), which revoked the stock distribution option plan that had been offered to the original 6,296 farmer-beneficiaries of Hacienda Luisita, in lieu of land distribution, which is mandated under the Comprehensive Agrarian Reform Program.

However, the Court affirmed with modification PARC Resolution 2005-32-01 issued on December 22, 2005 by allowing the original farmer-beneficiaries to choose to remain as stockholders of HLI or get the land due to them.

In a resolution issued on November 22, 2011, the Court, however, decided to modify its July 5, 2011, decision by directing the total distribution of the plantation to its farmer-beneficiaries.

The Court granted the partial motions for reconsideration filed by the PARC and the DAR, Alyansa ng mga Mangagawang Bukid sa Hacienda Luisita and the Farmworkers Agrarian Reform Movement Inc., seeking to recall and set aside its decision with respect to the option granted to the farmworker-beneficiaries to remain with HLI through the stock distribution plan.

Shopping is more fun in the PHL, say tourists. . .

These tourist markets are South Korea, People’s Republic of China, the United States, Japan, Australia, Taiwan, Canada, the United Kingdom, Singapore, Malaysia, Hong Kong and India.

According to the survey, 38.2 percent of total respondents said they shopped in the Philippines, followed by sightseeing at 26.7 percent, nature and adventure at 10.5 percent, total sports 7.8 percent, beach holiday at 4.2 percent, total cultural at almost 3 percent, others (pleasure or vacation) at 2.05 percent, scuba diving at some 2 percent, investment opportunities at some 1.8 percent and to visit friends/relatives at 0.94 percent.

DOT Spokesman and Undersecretary for Tourism Development Planning Benito C. Bengzon Jr. expressed optimism that the current value of the Philippine peso versus the greenback “will likely encourage our foreign visitors to shop or spend more in the country, because of the purchasing power that this will give them. From the perspective of a tourist or a visitor, spending comes easy when you are in a country with a local currency with a value lower than that of the country where you came from.”

He added this is one of the many reasons “Leisure, Entertainment, and Shopping tourism is among the nine tourism products offered to our guests. Interestingly, strong or

weak peso, this continues to be one of the most marketable among the tourism portfolio of the Philippines.”

He noted in the DOT’s promotions abroad, “we sell the Philippines as a country where you can get anything you need—from the posh boutiques in Makati and BGC [Bonifacio Global City] to the tiangges [flea markets] in Greenhills. This probably explains why high-end buyers from Europe and bargain hunters from Asia and other parts of the world flock to the Philippines—because we have established our reputation as a “value-for-money destination.”

The DOT’s survey also showed tourists from India, at 57.14 percent of their respondents, enjoyed the most shopping in the country, followed by tourists from Japan at 46.11 percent, Malaysia at 42.5 percent, Canada at 41.4 percent, Hong Kong at 39.1 percent, South Korea at 38.5 percent, the United States at 38.4 percent, Singapore at 37.8 percent and the United Kingdom 34.2 percent.

A separate visitor sample survey, also conducted in 2017—this time of some 20,000 respondents—showed some 52 percent were in the Philippines mainly for pleasure or vacation (“What is the main purpose of your visit to the Philippines?).” This was followed by 21 percent of respondents who said they were visiting the country for business/professional work; some 21 percent were also here to visit

continued from a1

friends and relatives, while 2.6 percent were in the country for studies.

Only 0.6 percent of the respondents were in the Philippines for MICE (meetings, incentives, conventions and exhibitions), which is one of the key areas that the DOT has been trying to focus on and promote to markets abroad.

In January the DOT led the launching of MICE Road map 2030, a multisectoral plan aimed at reestablishing the Philippines as a top international convention destination, as well as a flourishing business and trade hub in the Asia-Pacific region.

The road map targets an increase in the gross value added of the MICE industry by P1.4 billion, an improvement of the average rate in delegate expenditure per meeting by 19 percent, some P25 billion in MICE revenues, an increase of at least 100,000 square meters in exhibition space and a 3-percent per-annum increase in the number of MICE arrivals, all by 2030.

MICE is among the country’s nine tourism products under the National Tourism Development Plan from 2016 to 2022.

Bengzon said the MICE industry has a high growth potential, with the Globex 2017 Report showing that the Philippines is the fastestgrowing trade fair market in Asia in 2016: space sold jumped to 9.6 percent, and a MICE delegate spends nearly six times more than what an average leisure tourist spends.

By Jovee Marie N. dela Cruz @joveemarie

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S the Philippines, along with China, Indonesia, Thailand and Vietnam, earned its uncomplimentary tag as a major plastic waste polluter, a lawmaker has filed a bill imposing a Plastic Bags Deterrence Fee of at least P20, and a heavy fine of up to P500,000 for every single day of violation.

House Bill 7902, authored by Rep. Harlin Neil Abayon III of Aangat Tayo party-list, provides for the phaseout of single-use plastic and phase-in of nontoxic and food-safe reusable plastic for the packaging, presentation, and storage of food and beverages.

Under the measure, manufacturers and importers of personal-care products, cosmetics, detergents and oil products that have micro beads as ingredients, or as part of their packaging shall be given five years to phase out all such products from the Philippine market and from their respective inventories. Other countries have banned these plastic micro beads because they are harmful to marine life.

The bill also bans the release of unrecoverable plastic and rubber balloons into the air; the sale and distribution of singleuse plastic at retail and wholesale business establishments; the throwing or disposal of cigarette butts, or any form of plastic waste or matter, and nonbiodegradable substances into the sea and other bodies of water, whether natural or man-made, including sewerage canals of any form; and the sale of personal-care products, cosmetics, detergents, oil-based products and other products containing micro beads.

The bill imposes a P20 fee per reusable plastic bag for deterrence and discouragement purposes at point-ofsale transactions at all retail purchase outlets nationwide.

The measure said such fees charged and collected shall be remitted to the National Treasury and allocated as a special purpose fund for the implementation of plastic waste management programs by the Department of Environment and Natural Resources (DENR) and local government units. The fee shall be adjusted for inflation by the Department of Trade and Industry (DTI) and rounded off to the nearest peso.

The bill requires prominently and strategically displayed warning signage on proper plastics disposal on public utility motor vehicles, and ships and water vessels of any kind, and along riverbanks and coastal areas.

It also mandates the DENR, DTI and Department of the Interior and Local Government to jointly formulate, approve and implement a national policy and implementing rules on redemption, recovery and

recycling of reusable plastic products and packaging that includes nontax incentives, “tradeable” credits, and other mechanisms to foster effective compliance.

Stiff penalties

The bill said any person, whether natural or juridical, who commits any of the prohibited shall be fined by the DENR or by any law-enforcement officer, and local government official, in the amount of not less than P10,000, nor more than P500,000 for every day of violation.

The fines prescribed shall be increased by 10 percent every two years to adjust for inflation and to maintain the deterrent function of such fines.

It also penalizes serious and gross negligence by local government units on the proper collection of disposed plastic wastes and garbage on public and private roads within their respective jurisdictions.

The measure said serious negligence of officials at the barangay, municipal, city, provincial and national levels of the responsibility to properly collect and dispose of garbage, especially those along or in waterways and in coastal areas, shall constitute probable cause for the Office of the Ombudsman to motu proprio immediately suspend such officials for three months without pay, allowances and any other kind of remuneration from public funds.

The bill said this three-month suspension by the Ombudsman cannot be appealed.

The measure said gross negligence of officials at the barangay, municipal, city, provincial and national levels of the responsibility to properly collect and dispose of garbage, especially those along or in waterways and in coastal areas, shall constitute probable cause for the Office of the Ombudsman to motu proprio: immediately suspend such officials for six months without pay, allowances and any other kind of remuneration from public funds; and file criminal and administrative charges to remove and ban from the same officials from holding any public office for 10 years.

Meanwhile, any Filipino citizen of voting age convicted of any of the prohibited acts shall lose the right to vote and to be a candidate in the two national and local elections to be held after the date of his or her conviction.

According to Abayon, his proposal seeks to address the plastic waste “plague” that has spread to forests, mountains, farmlands, urban communities and to the country’s rivers, lakes and seas.

“It has become urgently necessary for the enactment of a law designed to create, instill and sustain the habit of caring for the environment and keeping it free from plastic wastes,” he added.

Economy BusinessMirror

www.businessmirror.com.ph

Editor: Vittorio V. Vitug • Thursday, July 5, 2018

Convenience stores are ‘big winners’ in PHL’s consumer-driven economy

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By Cai U. Ordinario

@cuo_bm

onvenience stores are “big winners” in the Philippines, owing to the convenience they offer, according to a Nielsen report.

Based on Nielsen Philippine’s latest Shopper Trends report, small or convenience store formats continued to increase and posted a growth of 20 percent in 2017, higher than the 15 percent growth posted in 2016.

Nielsen said convenience stores are leading the way. In the first quarter of 2018, there were 4,300 convenience stores in the country, nearly three times the 1,620 stores in 2013.

“Retailers in the past were guided by the paradigm that ‘bigger is better,’ but as lifestyles and consumption habits change, a shift in where consumers shop, what they

4,300 The total number of convenience stores as of Q1 2018, nearly three times the 1,620-store count in 2013

buy, the frequency and amount of spending follow,” states J. Patrick Cua, Nielsen’s managing director in the Philippines.

“Small format stores meet a distinct shopper need of conve-

nience as they are often situated near homes or high traffic areas,” he added.

Nielsen said small store formats are modern trade self-service stores occupying an area measuring 150 to 500 square meters.

It said these stores cater to more frequent shopping trips with smaller baskets. Convenience stores, small supermarkets, petrol stores and mini-marts fall under the small store category.

Convenience stores are now more popular since traditional sari-sari stores have already contracted by 1 percent and market stalls also by percent in 2017, respectively.

Nielsen said this is the reason big retailers are also downsizing and expanding their small store format.

In the last five years, small store formats of supermarket chains have grown to over 410 stores in the first quarter of 2018 from around 220 stores in 2013.

“Bolstering the growth of small

format stores is the increasing influence of four global megatrends, which are supporting the growing consumer demand for faster and more convenient shopping experiences—urbanization, women joining the work force, shrinking household size and the rise of eating out,” Nielsen said.

“The robust business-process outsourcing segment also stimulates the growth of this retail channel.”

In the report, shoppers were asked to rank attributes that influence store loyalty and store choice.

These attributes correspond with four key factors—time, choice, experience and price.

Five of the top 10 attributes that small store shoppers identified as important pertain to time-saving attributes, such as convenient to go to; long opening hours; easy to quickly find what I need; efficient checkout counters; and ease of parking.

But convenience is not the only consideration for Filipinos. Price

and affordability is another big concern.

Three of the top 10 attributes pertain to price—low prices for most items; good value for money; and provide really good deals and promos.

To address this shopper preference, Cua said retailers and manufacturers should price products close to the prices of bigger stores.

“Carrying products that sit on lower-priced tier and offering value through promotions can also woo shoppers to visit more and increase their spend,” Nielsen said.

Shopper Trends is a syndicated annual report that Nielsen conducts across 54 markets globally.

It provides a comprehensive overview of retail environment trends and an understanding of shopping behavior across the different trade channels.

It provides insights on where, when and how often people shop, and their emotional commitment and perceptions about key modern trade retailers.

Palay farm-gate price soars to 45-month high at P21.38 per kilogram

By Jasper Emmanuel Y. Arcalas @jearcalas

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he average farm-gate price of palay (unmilled rice) sustained its momentum for the eight consecutive week to a 45-month high of P21.38 per kilogram (kg) just before the country enters the lean season for the staple.

Prel i m i n a r y d at a relea sed by the Philippine Statistics Authority (PSA) published on Tuesday showed that the palay price as of the fourth week of June expanded by 10.38 percent, from its average quotation of P19.37 per kg a year ago.

PSA data compiled by the BusinessMirror showed that this is the highest recorded average farm-gate price of palay since the fourth week of August 2014, when the average quotation reached P21.33 per kg.

The latest farm-gate price of palay is just a few centavos away from surpassing the highest quotation of P21.53 per kg recorded by the PSA starting the fourth week of July until the first week of August in 2014.

From June 20 to 26, the PSA

noted that the highest farm-gate price of palay was recorded in South Cotabato, where traders bought rice at P25.08 per kg.

The lowest quotation of P18 per kg was recorded in Compostela Valley.

I ndu st r y a nd gover n ment sources told the BusinessMirror that the average quotation of palay could breach the P22per-kg price level and set a new record-high during the lean season, which runs from July to September.

The country’s rice harvest declines significantly during the lean months.

The highest average quotation of palay of P21.53-per-kg ever was recorded during the middle of the lean season of 2014.

In fact, the price monitoring report of the PSA showed t h at some re g ion s h ave a l ready breached the P22-per-kg average quotation.

For ex ample, buy ing pr ice of palay in Ilocos region is now averag i ng at P22. 50 per k g , while average quotation in Central Luzon, the country’s rice g ra n a r y, is hover i ng a rou nd P22.43 per kg.

@jonlmayuga

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he implementation of an action plan to address Boracay’s garbage woes is on track, according to the National Solid Waste Commission (NSWMC).

Eligio Ildefonso, executive secretary of the NSWMC secretariat, told the BusinessMirror that garbage produced on the island is continuously being shipped out on a daily basis since April, and tha,t so far, the plan is working.

In a related development, Environment Secretary Roy A. Cimatu said water quality in Boracay has greatly improved, and that the sea surrounding the island paradise can no longer be called a “cesspool.”

At the sidelines of the 31st anniversary celebration of the Depart-

ment of Environment and Natural Resources (DENR) at the Amphitheater inside the Ninoy Aquino Park and Wildlife Rescue Center in Quezon City on Wednesday, Cimatu said the rehabilitation of the country’s top tourist destination in the Municipality of Malay, Aklan, is “on target.”

“We are clearing the road of obstruction, and as far as water, we are on target,” he said.

“I am very definite that the White Beach is already clean. I have the graph of all daily and weekly monitoring reports. It [bacterial level] is low and steady, and I can claim now that it is already clean. You can see the pictures, and it is clean,” the DENR chief said.

No more waste

“By the time Boracay is reopened, the solid-waste management problem is

briefs

S.C.: State workers’ bonus, allowance subject to taX

THE Supreme Court (SC) has affirmed the validity of a Bureau of Internal Revenue (BIR) regulation, which subjects nontaxable benefits of government employees such as allowances andbonuses to withholding tax.

In a media briefer, the SC Public Information Office said the Court voted unanimously to affirm the validity of Sections 3, 4 and 7 of Revenue Memorandum Order (RMO) 23-2014 issued by the BIR which classified as taxable compensation income allowances, bonuses, compensation for services granted to government employees and other benefits that have been enjoyed by government employees for some time now without any tax deductions, except for the 13th-month pay, in excess of P30, 000 and the loyalty pay.

Under RMO 23-2014, which took effect on July 7, 2014, all benefits received by employees and officers of government will be subject to 30-percent to 32-percent tax.

The Court, however, declared null and void Section 6 of RMO 232014, which compels local government officials, such as governors, city and municipal mayors, barangay captains and heads of office in government agencies and government-owned or -controlled corporations to withhold and remit withholding taxes. Joel R. San Juan

Info & tech park to rise in Nueva Ecija capital city

Franchise Asia 2018 expo

The country’s top franchisers pose for a souvenir group shot at the media launch and news conference of the Franchise Asia Philippines (FAP) exposition that promises to feature 700 plus homegrown and international brands in the food, retail and service sectors to be held at SMX Convention Center. Photo shows (from left) Rebecca Bucad, FAP expo chairman; Samie Lim, Philippine Franchise Association (PFA) chairman emeritus; Dr. Alan Escalona, PFA chairman; Richard Sanz, PFA president; Sam Christopher Lim, FAP overall chairman; and Bing Sibal-Limjoco, PFA vice chairman. NONIE REYES

Cimatu: Environment remains priority over mining

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nvironment Secretary Roy A. Cimatu on Wednesday maintained that environmental consideration remains to be the top priority of the Department of Environment and Natural Resources (DENR).

Interviewed by reporters at the sidelines of the 31st Celebration of the DENR at the amphitheater inside the Ninoy Aquino Park and Wildlife Rescue Center, the DENR chief said President Duterte’s marching order and his order to mining companies are anchored on the environmental aspect of mining operations.

He assured the public that the environmental the aspect of mining operations will remain one of the important audit criteria as far as the DENR is concerned.

“Environment is part of the audit

and it is my marching order to mining companies,” Cimatu said.

Based on the Mining Industry Coordinating Council’s initial review, however, only four mining operations out of the 27 that were recommended for closure or suspension, failed the MICC review.

The others passed environmental standards as per MICC review. These mining companies were recommended for closure or suspension by then-Secretary Regina Paz L. Lopez in February 2017.

According to Cimatu, the MICC is still finalizing the result of its review.

But he said the MICC review and recommendation will be a big factor in his decision to recommend the closure, suspension or to clear the mining companies of the alleged

offense or violation.

Cimatu declined to give details of the DENR’s audit result, which he said, will be harmonized with that of the MICC review. The MICC, he said, is expected to finalize its audit and submit recommendations to the DENR this month. Based on the recommendation, Cimatu said, he will come up with a decision whether to suspend or close the mining operation.

Cimatu also reiterated President Duterte’s policy to “reinvent” mining, saying that open-pit mining will no longer be allowed. He added the DENR will also strictly enforce the policy that mining companies must implement progressive rehabilitation by not disturbing other areas except for the area that they are allowed to extract minerals. Jonathan L. Mayuga

Boracay sheds ‘cesspool’ tag, garbage woes resolved

By Jonathan L. Mayuga

A3

solved,” according to Ildefonso.

The local government of Malay, Aklan, he added, had agreed to fund the implementation of the action plan for garbage, including the tipping fee to ship out the garbage out of the island to the town’s materials recovery facility (MRF).

Meanwhile, Ildefonso said the Task Force Boracay is preparing to file charges against the officials of the national government agencies who are responsible for the degradation of the country’s top tourist destination.

“Charges will be filed against other government officials and employees. From the DENR and maybe from the DOT [Department of Tourism],” Ildefonso said.

Officials of the Malay-LGU have already been charged before the Ombudsman for dereliction of

duty in the implementation of various environmental laws, including Republic Act 9003 or the Ecological Solid Waste Management Act of 2000.

As part of the plan, the MRF in Barangay Manoc-Manoc which is now functioning as a mere garbagetransfer station will be revived to be a fully functional MRF where 3Rs— reduce, reuse and recycle—will be implemented.

However, he said if the MRF works in Barangay Manoc-Manoc, the two MRFs in Barangays Yapak and Balabag would also be revived.

Info drive

Under RA 9003, there should be an MRF for every barangay. However, he said there are instances when two small barangays that produce garbage in smaller volumes

can jointly use one MRF. In the case of Boracay, this is not advisable, Ildefonso said, considering that the island is producing 100 tons of garbage every day.

The reason why garbage accumulated, he said, is the fact that only 30 tons of garbage are shipped out daily.

As part of the plan, the Malay local government, DOT, DENR, and local government will fully implement RA 9003, and conduct massive information, education and communication campaign that will include arriving tourists about various environmental laws, including RA 9003 and the Clean Water Act of 2004, he said.

“There will be an awareness campaign. Before they are allowed to go to Boracay, tourists will be informed about the law against littering. This will also be conducted for residents of Boracay,” Ildefonso said.

President Duterte has issued a proclamation dated June 25 creating and designating a 3-hectare complex in the capital city of Nueva Ecija as an information and technology park (ITP) that will henceforth be known as the Palayan City Government Center and Central Business Hub. Under Proclamation No. 526, the ITP covers a land area of 30,013 square meters in Barangay Singalat, Palayan City. The board of directors of the Philippine Economic Zone Authority (Peza) recommended the creation of the ITP pursuant to Republic Act No. 7916, or the Special Economic Zone Act of 1996, as amended by RA No. 8748.

The business-process outsourcing center in Palayan City Business Hub is under the public-private partnership scheme, a news statement said. The Kuala Lumpur, Malaysia-based AlloyMTD agreed to put up the project and operate the center for the next 30 years.

On Friday July 6 at 3 p.m., the Peza and the Palayan City local government led by Mayor Rianne Cuevas and her councilors will be formally signing the document that will make the Palayan City Government Center and Central Business Hub a special economic zone with all its attending benefits.

Sen. Richard J. Gordon and Alloy MTD Chairman Bong David are also gracing the Peza-Palayan City signing, which will be held at the Peza office in Makati City.

‘No hungry child with natl feeding law’ No child should go hungry again with the signing into law of the National Feeding Program, Sen. Grace Poe, one of the main authors of Republic Act No. 11037, or the Masustansyang Pagkain Para sa Batang Pilipino Act, signed on June 20.

“Hunger strikes to the very core of our humanity. Children, most especially, will find it hard to understand why they do not have food to eat because the reality is they have a right to nutritious food,” the senator said.

“This is why, from my first day as a legislator, I have pushed vigorously for the passage of this bill. It is unforgivable not to be able to deal with hunger,” she added.

Poe thanked President Duterte for signing the law, and her colleagues at the Senate and the House of Representatives for supporting its passage. Butch Fernandez

A4

TheBroa

Business

Thursday, July 5, 2018

GOVT OPENING DOORS F

A degree isn’t everything: PHL work places now

TESDA students get practical training in basic hair-care services in Las Piñas. NONIE REYES

A

By Samuel P. Medenilla

FTER having been a bean counter for months, it suddenly dawned on you to follow your true calling: cooking beans. It’s a difficult shift for many, especially those who chose accounting to please their parents’ wish but want to pursue a passion as chefs. The new Philippine Qualifications Framework (PQF) makes it easy; so the government claims.

Maria Cynthia Rose B. Bautista of the University of the Philippines defines the PQF as “a quality-assured national system for the development and recognition and awarding of qualifications acquired through different ways and methods.”

Bautista, vice president for academic affairs of UP, said in a news briefing the Philippines is banking on the PQF, which relies on a certification system, to boost the employability of graduates and trainees.

Bautista, former commissioner at the Commission on Higher Education (CHED), further explained the PQF was created as an attempt by the Philippine government to comply with global standards, particularly of its Southeast Asian neighbors through the Asean (Association of Southeast Asian Nations) Qualification Referencing Framework, or AQRF.

The AQRF aims to standardize the educational system of countries in the region to ease the mobility of workers in Asean.

Laggard

PRIOR to PQF, the number of years of basic education and teaching system in the Philippines were “falling behind” Asean.

While the local education system remained “knowledgebased”—students were tested based on what they know—most

countries had already transitioned to a “learning-outcomes system,” wherein students are required to demonstrate competencies instead.

Currently, Thailand, the Philippines, Indonesia and Malaysia are aligning their respective educational standards with the AQRF for the construction, tourism and dental industry.

Bautista said Malaysia is now leading in terms of quality of education in Southeast Asia, having adopted the learnings-based education as early as 2007.

Realizing that the learningbased outcome needs to be institutionalized due to its potential of improving local education, Congress passed last year Republic Act 10968, or the PQF Act. Modeled after the AQRF, Bautista said the PQF Act aims to become the “catalyst to make teachers and institutions” focus on providing competencies to students.

Ladderized

THE PQF currently has eight levels.

The first five levels are equivalent to basic education.

Students will be given National Certificates (NC) for completing the first four levels. A student is conferred a diploma after completing the fifth level.

The sixth level of the PQF is equivalent to a baccalaureate de-

gree; and the seventh, to a master’s or postbaccalaureate degree.

The eighth level is the most complex and is equivalent to a doctoral degree.

Bautista said the system is similar to the training assessmentcertification system used by the Technical Education and Skills Development Authority (Tesda). Such system, she noted, reveals Tesda leads the Department of Education (DepEd) and the CHED in enforcing the PQF. Under the Tesda system, each skill or qualification has a “ladderized” level.

For example, a trainee who would like to become a cook on a cruise ship could first take a course called Ship’s Catering Services NC (National Certification) 1. Later, the trainee could take NC 2 (cookery course) before finally getting an NC 3 in ships’ catering.

Each course could be taken separately, making it more affordable for trainees since they could already work after getting NC 1 to earn the income to take for further training.

Practice

THE effect of the PQF Act, once fully implemented, is expected to be twofold.

For one, the government believes the PQF would allow more employment opportunities for students and trainees by giving equal importance to competency as with knowledge.

Students and trainees are expected to demonstrate and apply knowledge in real-life situations, making it faster to learn.

The reform aims to address the perennial mismatch in the local employment market strangled by so many graduates deemed still unfit for in-demand jobs. This is apparent in the 2013 to 2020 “Jobsfit Report” of the Department of Labor and Employment (DOLE). The report said there are still 43 in-demand but hard-to-fill occupations.

These unfilled occupations belong to a broad spectrum: from white-collar jobs like accountants and civil engineers to blue-collars like welders and plumbers.

Aside from technical knowledge, many graduates also lack the

needed “soft skills” or interpersonal skills and attitudes of students like communication skills, team work and critical learning to land them a job, the report added.

Skills

DOLE’S Dominique R. Tutay said in most cases soft skills are actually valued by employers over technical skills in most cases.

“Employers are very particular about this because they could always train a worker on technical matters,” said Tutay, director of the Bureau of Local Employment (BLE). “But if applicants lack the necessary soft skills, it will be difficult for them [to perform] in a workplace.”

She added many applicants tend to flunk job interviews after failing to demonstrate soft skills.

With this in mind, the Tesda is now piloting its new nine modules of basic competencies integrated with 21st-century skills to ensure its trainees are more job-ready.

The modules include collaboration, communication, critical thinking, entrepreneurship, environmental literacy, information technology, learning and innovation, lifelong learning and occupational health.

Lifelong

THE second benefit of the PQF is that it allows people to move in and out of formal education promoting the culture of lifelong learning. People will no longer be constrained to do work that is related to the course or training they took, since the PQF provides elbow room for other fields of profession.

The PQF system also seeks to eliminate discrimination against those who did not go through formal schooling, by promoting entrepreneurship and technical vocational education and training (TVET) as viable options for making a living.

“You can even ‘privilege’ nonformal and informal learning so there will be pathways and equivalency in place,” Bautista said.

“Qualifications will not come only from schools; even going to work will give credits.”

No less than the Asian Development Bank (ADB) and the Inter-

A FEMALE student trains with a mentor on how to handle a cutting torch at a Tesda training center in Las Piñas. NONIE REYES

national Labor Organization (ILO) acknowledged the benefits of education reform toward reinvention and skills improvement.

Both international organizations emphasized these are crucial factors that would allow workers to keep up with current labor market trends such as the introduction of robotics, artificial intelligence and three-dimensional printing.

This flexibility is already apparent in Tesda, wherein certifications could be obtained in tranches.

For example, a cruise ship’s cook, who failed to go through formal training, could still get an NC 3 using work experience as stock knowledge.

options: prepare for college education, look for work, or start a business after graduation.

K-12, which took effect in 2016, has four tracks: academic, technical-vocational-livelihood (TVL), arts and design and sports.

“Before, when you drop out of high school, you are really a dropout; as you are expected to proceed to college or higher education. That is no longer the case,” Malaluan said. “Senior high school is no longer foundational because it has many endpoints.”

He explained that those on the TVL track are trained to be job-ready after graduation. However, Malaluan said they could still move to formal education later on.

Nonlinear

Unpacked

GOVERNMENT educators are using Tesda’s experience in the application of PQF to basic and tertiary education.

DepEd Undersecretary Nepomuceno Malaluan said they have done so on the K-12 program, which expanded local basic education by two years to include junior and senior high school.

Malaluan, who also acts as DepEd spokesman, said one of the innovations of the K-12 program is the inclusion of a tracking system.

Here, a student has the following

BAUTISTA said it was during her time in the CHED that the agency began to “ladderize” some courses by “unpacking” needed competencies.

Courses will be divided in levels, which offer specific jobs to those who will be able to complete it, to make it more accessible to the public, she explained.

Bautista cited the case of engineers who are now composed of professional engineers, engineering technologists and engineering technicians.

aderLook

sMirror

www.businessmirror.com.ph | Thursday, July 5, 2018

A5

FOR NONDIPLOMA JOBS

w put a premium on skills, experience, even EQ

WELDING is one of the in-demand courses offered by Tesda. NONIE REYES

Licensed professional engineers will be hired for jobs requiring complex engineering problems.

Typically, it can be completed in four to five years since it has the most competency requirements among the three.

Meanwhile, engineering technologists will be hired for broadly defined engineering problems. This course could be completed in three to four years.

Becoming an engineering technician could take only three years.

They could get hired in jobs with well-defined engineering problems.

“Before specifying or employing engineering expertise, it is important to gauge the level of engineering expertise needed,” Bautista said.

To note, an engineering technician could become a professional engineer if he or she earns enough credits and passes the needed licensure exam.

Bautista said the CHED has undertaken similar “ladderization” initiatives for other professions.

Application

TUTAY said the “ladderized” approach will have an enormous impact in the labor market. She explained the system could help companies fill manpower needs faster with workers with the ap-

propriate skills sets.

The system will allow younger people to join the workforce to gain not only income for their families but also to earn valuable experience to qualify them for higher learning.

If, for example, a company has a vacancy for an administrative clerk, but requires its applicant to have a degree, then the degree is already “too high” for the position, according to Tutay.

So the PQF “is really about matching the qualifications standards over the job requirement,” she added.

Tutay added the PQF will encourage companies to hire based on standardized skills and competencies and not just credentials.

She said they expect this will help in standardizing pay for workers, especially those only having basic skills.

The BLE said it will be conducting a study to determine the implications of PQF on the workers’ pay.

Support

LOCAL businessmen have been advocating for the PQF system, expecting lesser cost and efficient hiring process.

The Philippine Chamber of Commerce and Industry (PCCI) and the Employers Confederation

of the Philippines (Ecop) said they are willing to hire K-12 graduates, particularly those undertaking the TVL track.

“It is skills that we are after...It is not [those who took the] education [track] in general,” Ecop President Donald G. Dee said.

Likewise, PCCI Chairman George T. Barcelon aired the same sentiment, saying the PQF is a good approach for them to “prequalify” applicants.

Both business leaders, however, noted they cannot prioritize hiring K-12 graduates over those with college degrees since most of the applicants still belong to the latter group.

“What we could do is to encourage our members not to distinguish [between a] K-12 graduate or if you’re a college graduate,” Barcelon said. “Our advocacy is to provide jobs, jobs, jobs. We have no bias for [a graduate of] K-12 or a college graduate.”

To further show its support for K-12, the PCCI partnered with the German government for pilot studies on how private-sector intervention could improve the quality of TVET nationwide.

TVET

THE success of the PQF system is relative to the level of success in

the promotion of TVET as a feasible alternative to formal education.

The latter is crucial in gaining the trust of the private sector and educational institutions on the PQF since TVET is already the most developed among other nonformal forms of education.

Other nonformal sources of qualifications like equivalencies for work experience, training from the Church or civic organization are still in the process of being developed.

“If the formal education system fails to recognize that there are other sources of competencies and learning activities outside of the formal system, then the status quo will continue,” Malaluan said.

Likewise, Bautista said the PQF will also become irrelevant if companies will not hire based on the qualifications from nonformal education.

Currently, Barcelon said mainstreaming TVET remains a challenge for both the government and the private sector since there are still a few training institutions that offer TVET courses and sparse number of firms encouraging TVET-based hiring.

Incentives

IN his presentation in a colloquium in June, Barcelon said there were only 4,609 institutions offering 20,329 accredited TVET programs in 2015. Likewise, there were only 421 firms offering 1,208 enterprise-based programs that year.

The PCCI is calling on the government to provide tax incentives to encourage more companies to engage in TVET. “The incentive could be given to companies, which [could] donate machines to training centers,” Barcelon said.

Catholic priest Jose Dindo S. Vitug, Salesians of Don Bosco, is also pushing for greater government support for the promotion of TVET.

“Techvoc [technical-vocational] training is very, very expensive.

If you go to our school you will be surprised by the cost of our machines,” Vitug, the executive director of Don Bosco ONE TVET Philippines, said.

He said each of their welding machines cost P160,000, while their training tools for their electronics courses could cost almost P1 million per machine.

Don Bosco is one of the well-known institutions offering TVET. The Catholic religious institution has been doing it in the last 47 years. The SDB-run schools are known for having 80 percent to 90 percent of its TVET graduates being employed by its partner companies.

Pains

ASIDE from the lack of TVET providers, Vitug also raised concerns over the current curriculum for the K-12’s TVL, which he said is still too “academically laden,” with subjects like statistics and qualitative research.

“The government still wants them to be ‘college-ready.’ But in our case, we are training our students to be employed immediately after their training,” Vitug said.

“The poor have no luxury of time.”

He also raised concern about the 80-hour on-the-job training period for TVL students, which he said is insufficient especially if they are taking highly technical courses like computerized systems, welding and automotive industry.

“In Don Bosco our OJT period is 960 hours because their training is highly technical,” Vitug said.

“The more you [spend time doing] it the more you become an expert in a particular field.”

Despite these problems, Vitug believes the K-12 and the PQF will improve the national education system once its implementation problems are resolved.

Consultations

MALALUAN said issues in the implementation of the PQF will be addressed in the nationwide sectoral consultations for the implementing rules and regulations (IRR) for the PQF Act.

Malaluan said they are now in the process of finalizing the draft guidelines for the PQF Act. “Once that consultation draft is vetted by the agencies, then we will [hold] consultations,” said the official leading the committee crafting the IRR. Malaluan emphasized the importance of the consultation since its inputs will be used to set the rules on how to certify competencies, which will effectively overhaul the current education system.

However, former Labor Undersecretary Rene E. Ofreneo said the operationalization of the PQF would take a long time since the government and stakeholders will practically start from scratch in establishing the qualifications for certain nonformal sources of education.

“How do you recognize competency of those [working in] NGOs [non­governmental organizations]?

What about overseas workers; those who did not finish schooling but learned [from] their information-technology based job?,” Ofreneo said. “There are so many things that need to be clarified.”

Still, the former dean of the UP School of Labor and Industrial Relations is optimistic the initial consultations for the IRR will be fruitful, especially if these consider the country’s priorities in terms of manpower needs.

“I think it will be appropriate to connect the operationalization of the PQF in relation to our industrial vision and our vision for our agricultural modernization,” Ofreneo said.

He pointed out this aspect of the PQF will ultimately determine the country’s economic development in the coming years.

A6 Thursday, July 5, 2018 • Editor: Angel R. Calso

Opinion BusinessMirror

www.businessmirror.com.ph

editorial

Leptospirosis can be deadly

A

lmost a month after the state weather bureau Philippine Atmospheric Geophysical and Astronomical Services Administration announced on June 8 that the rainy season has officially begun in the Philippines, the rising number of leptospirosis cases nationwide has alarmed the Department of Health (DOH). Health Secretary Francisco T. Duque III said the extensive flooding caused by heavy rains contributed to the spike in the number of leptospirosis cases, an infection caused by a bacteria found in the urine of rats and other animals.

Leptospirosis is an infectious disease caused by the leptospira bacteria, which can be transmitted through cuts and wounds with floodwaters contaminated with urine of infected animals. This disease can be deadly. Symptoms include high fever, headache, chills, vomiting, abdominal pain, and red eyes, which are pretty common with other ailments. That’s why it’s important for patients to tell their doctor they’ve been exposed to floodwaters.

From January 1 to June 9, the DOH has recorded 1,030 cases. This is 41 percent higher than the number of leptospirosis cases recorded during the same period last year. What’s alarming, however, is that 99 patients have died due to leptospirosis.

In Metro Manila there were 234 cases recorded by the DOH from January 1 to July 1, or 60 percent higher than the 146 cases recorded in the same period in 2017. Topping the list of cities with the highest number of leptospirosis cases in Metro Manila is Quezon City with 87, followed by Manila, Taguig, Parañaque, Caloocan, Las Piñas and Pasig. As of this writing, 38 people in Metro Manila have died due to leptospirosis.

In Western Visayas the DOH Region 6 has recorded 232 leptospirosis cases with 27 deaths from January 1 to June 16. Most of these cases are in Negros Occidental with 83; followed by Iloilo province with 58; Capiz, 33; Guimaras, 27; 13 each in cities of Iloilo and Bacolod; Aklan with three, and one in the province of Antique.

With the alarming number of leptospirosis cases nationwide, the health secretary advised patients against self-medication. Instead, Duque urged the public to see a doctor after they wade into floodwaters even if they don’t have an open wound where the bacteria can enter. He said the DOH is distributing medicine and other medical equipment to government hospitals to ensure they are prepared to handle the spike in leptospirosis cases.

Duque reminded the public that as much as possible, they should avoid soaking in floodwater. But if this is unavoidable, they should use protective gears like rubber boots so they will not be infected. He encouraged those who experience the symptoms of the disease to seek timely medical help because leptospirosis could be fatal.

The thing about leptospirosis is that it’s a two-phased kind of disease.

Initially the patient will have the symptoms, they will get well and the disease comes back. That’s when the complications will set in—complications with the liver, possible meningitis, and the kidneys might be affected, as well.

Before things become this bad, the government—specifically the DOH —must strengthen its nationwide information campaign to raise public awareness regarding this deadly disease.

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Cheap energy is over John Mangun

OUTSIDE THE BOX

H

ave you ever tried to start a fire without using matches or a lighter? Then you know how incredibly difficult that is and why humans—in comparison to the last 300 years —essentially lived in caves eating tree bark since the beginning of time.

But you might say the Egyptians built the Great Pyramid of Giza thousands of years ago. That is a testament to the ingenuity and brute force of Homo sapiens. Besides, there are a large number of people that believe the Pyramid was built by aliens, so there is that also.

What changed about 300 years ago? It was cheap and readily available energy. Jean Chancel invented the self-igniting match in 1805. Since then, from the humid jungles of Africa to the frozen tundra of Siberia, fire—energy—became cheap and readily available to everyone.

Heron of Alexandria, who lived in Roman Egypt during the first century, described the “aeolipile,”

a simple steam turbine that spins when the central water container is heated. Yet the first practical application of “steam power” came in 1698 when Thomas Savery invented a steam pump for pumping water out of mines.

Uses of this energy source increased exponentially with the first commercial steam powered ship in the early-1800s. Also by 1800, 200 steam-powered looms were used in England’s textile industry. The entire Industrial Revolution of mass manufactured goods, as well as the factory system, rested on steam power. Many of the designs for the machines themselves dated back as early as Leonardo da Vinci, but

Worsening peace and order situation

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the power to run those machines came only with the application of steam power.

About the same time the first commercial discovery of crude oil happened in the US in 1859. With this new “cheap and readily available” energy source came the foundation of all what we call modern technology. Electricity generation had been around for some time, but the ability to use a portable engine fueled by a crude oil byproduct brought electricity to the world as matches did for fire. The rest is history.

However, the course of history changed in 1973. That was the year of the Arab oil embargo and the global price of crude oil moving from $3 a barrel to $12. That event was preceded by the US allowing the dollar to “float” and not being convertible to gold or silver. In hindsight, there is a theory that if the dollar had not been made to float, the economic impact of the oil price increase would have been minimal.

However, the data unmistakably shows that global economic productivity growth since the late-1700s peaked at the same time oil was no longer “cheap.” Further, the 40-year reign of “Keynesian Economics” that the government could borrow and

T

HE present worsening peace and order situation in the country has a historical antecedent from President Corazon C. Aquino’s regime and other post-Marcos administrations.

President Rodrigo R. Duterte merely inherited the intractable problem. This is so because the erroneous social and economic policies of past administrations created more crises, instead of shaping the future.

It was so terrible, in fact, that during Aquino’s watch the United States government withdrew all US Peace Corps volunteers from the country, an unprecedented move following the kidnapping of a Japanese national and an American Peace Corps volunteer by the New People’s Army in Negros Occidental.

When Sen. Juan Ponce Enrile decried the peace and order situation in August 1990, the two abducted foreigners were still not released by their captors.

“Sadly, the Philippines has acquired the not too flattering image and distinction of being one of two countries in the world, Liberia being the other, where the US opted

without warning and without notice to the host government to pull suddenly all Peace Corps volunteers,” Enrile said.

“The president herself promised almost two years ago to jail one big fish to prove her determination and sincerity to finally eradicate graft and corruption in her administration,” Enrile told the Senate. “Until now, nothing has happened. The nation is waiting with great anticipation for the president to fulfill her promise.”

He then listed a number of scandals that plagued the Cory administration: the Garchitorena land scam; the Tarlac mess; the Roppongi land sale; and the Luzon Petroscam.

Compounding the problem was the rapidly increasing population.

One and a half million babies are born every year.

Three more Filipinos join the population every minute, all of them requiring child and health care and educational infrastructure, not to mention shelter, clothing and food.

That, Enrile said, “would require more money and resources which we hardly have.”

Worsening economy

When Mrs. Aquino ascended the Presidency in 1986, the official pesodollar exchange rate was 19.13 to $1.

By 1990 it was 23.87:$1.

At the end of 1985, Enrile observed, there were 1,232 listed items of goods which were either banned from entering the country or covered with high tariff duties to discourage their importation.

In line with the import liberalization policy of the Aquino administration, as dictated by the International Monetary Fund and the World Bank,

by April 1988 all but 296 of the items were allowed to enter with low tariff duties.

“As a consequence of this liberal and indiscriminate importation policy, the country imported more than what it exported. In other words, we bought more goods and services from foreign markets than what we sold

spend, knowing that increasing economic production would always pay off the debt, began to fail.

The idea that the government borrowing could always stimulate an economy—following the normal “boom/bust cycle”—depended on cheap energy. Borrow money and pay people to dig unnecessary holes and then fill those holes in to increase demand, and consumer spending stopped working. Today we see the results of that theory.

So what happens now? All the large-scale wind and solar power in use rely on fossil fuel backup and that is not going to change any time soon.

But the government debt burden increases daily.

There is a bright spot. Countries like the Philippines that have not “borrowed-and-spent” in the past 30 years to gain economic growth will prosper even more in the years to come. Be grateful that the Philippines does not depend on government for its economy so far. But we must adjust to the new not-so-cheap energy world.

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to them,” Enrile said.

“In addition, our economy had to incur heavy trade balance deficits from 1986 to 1989. Look at the trade balance deficits: $202 million in 1986; $1.017 billion in 1987; $1.085 billion in 1988; and $2.153 billion in 1989, or a total of $4.457 billion in four years.

“If we were to include the estimated trade balance deficit for 1990, the total would reach an enormous amount of $7.294 billion or P173.59 billion,” Enrile said.

The Aquino administration financed the immense trade balance deficits by borrowing massively, either from local sources or from abroad.

“The claim of the Aquino administration that these trade deficits arose from large importation of capital equipment and machineries to be used by new foreign investments is not supported—in fact, it is belied—

by Central Bank figures,” Enrile said.

During the Aquino administration, foreign investments amounted to just $130.51 million in 1986; $95.21 million in 1987; and $70.70 million in 1988.

The total new foreign investments attracted by the Aquino administration from 1986 to 1988 was $296.42 million, just slightly higher than the $259.76 million foreign See “Arillo,” A7

Opinion BusinessMirror

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Culture of death, uncertain future Val A. Villanueva

Businesswise

M

ayor Ferdinand Bote of General Tinio, Nueva Ecija, was felled by an assassin’s bullet on Tuesday, just a day after Tanauan, Batangas, Mayor Antonio Halili was shot dead by a marksman.

These incidents seem to be a sequel to the fatal wounding of Fr. Rey Urmeta, a Catholic priest in Calamba City, Laguna; and the deaths of Fr. Mark Ventura from Gattaran town in northern Philippines, and Fr. Marcelito Paez of Jaen, Nueva Ecija, in the hands of unknown assailants.

The mayors are suspected of involvement in the drug trade, while faith-based social development network Philippine Misereor Partnership Inc. (PMPI) said the priests were known to be human-rights defenders.

President Duterte said that Halili probably deserved what he got. He “suspected” him to be an illegaldrugs merchant. In the murder of the two priests, he surmised that the motive was vengeance as one of them was “suspected” to be a womanizer.

In all these cases, the President justified an inexcusable act in the absence of a credible investigation by the police. Also, the killers seemed to be cold-blooded, without conscience and fear of God. Why wouldn’t they be, some pundits claim, when their “boss” believes that God “is stupid.”

In his first two years in office, Duterte has already drenched the country with blood as he had promised during the presidential campaign. It may be difficult to establish how many have been killed in his drug war. The Commission on Human Rights (CHR) is confident, however, that the death toll is bigger than what this administration is making us believe. The Philippine National Police (PNP) has placed the number of deaths at 4,000, while human-rights advocates believe that the death toll could be over 12,000 of mostly poor urban dwellers, children included.

Many people believe that Duterte has sunk the country into its vilest human-rights catastrophe since the Marcos dictatorship. Some even think that, compared with the late despot, Marcos would appear to be more virtuous.

It is a wonder then why Duterte still enjoys formidable approval ratings. Former finance secretary Roberto de Ocampo in his Philippine Daily Inquirer column “Federalism’s unpleasant surprise” said: “It would be snooty and condescending to dismiss this popularity as merely arising from uneducated voters comprising the country’s masses.

Perhaps our voters have actually longed for some time now for a strongman—an action-oriented, propoor president.”

I find a huge disconnect with this statement to what is happening on the ground. Unless people who have been surveyed are in some sort of a trance, I cannot for the life of me accept that this president is propoor and an action man. What has he done so far to uplift the livelihood of the poor?

The Ateneo School of Government, in a research recently made available to the public, said many victims of EJKs are mostly from the working poor—construction workers, tricycle drivers and ambulant vendors.

Now, the constitutional commission tasked to draft a constitution changing the country’s form of government from presidential to federal has gained traction with the completion of its task. It is now up to the President, and Congress he controls, to make this a reality.

Many people believe that Duterte has sunk the country into its vilest human-rights catastrophe since the Marcos dictatorship.

Some even think that, compared with the late despot, Marcos would appear to be more virtuous. It is a wonder then why Duterte still enjoys formidable approval ratings.

New York-based Xenon Lequin— senior associate, consultant, hedge fund client coverage at MSCI Inc. —believes that federalism does not necessarily solve the issue of unequal distribution of government revenues, and may potentially worsen it. This is the main argument of those who support federalism.

In an article he contributed to Rappler, Lequin said: “It is not as if all the revenues in the current system are being swallowed by NCR and surrounding regions, to the detriment of the remote provinces, as many federalism supporters will claim.

“A large part of the national revenues still go back to the LGUs through a standardized formula as the IRA [internal revenue allotment]. The IRA system is actually a way to redistribute income from the wealthier communities to the not-so-wealthy ones: for small municipalities, IRA allocation may finance a greater part of their budget compared to highly urbanized areas.

Because the highly urbanized areas have greater revenues from other sources, more of their budget can be financed with these other sources.

In the current scheme, it is actually the “generosity” of the larger cities which contribute to the development of the smaller communities.

If all tax revenues were kept at the point they originated, we might actually see the wealthier municipalities getting more income and the poorer ones getting less, resulting in a worsening wealth concentration problem.”

He says that “while it is true that some of the budget are still allocated at the national level [by Neda, for example, which is headed by the President], it is not as if the process is wholly arbitrary and inherently biased toward NCR. Neda has regional offices, which can propose projects for their regions, for the consideration of the national government.

There may be perceived “biases” towards the highly metropolitan areas, but this may simply be because these are the areas where the funds spent could generate higher returns. Obviously, metropolitan areas have more people and more businesses, and thus need more infrastructure and support. It should not be surprising for us that many of the highly visible projects are there. But if the regions can make a good case for projects on their locations, they should be able to make a proposal for it and escalate it to the proper local/regional/national agency for prioritization and inclusion in the budget.”

There are other disturbing issues against federalism, which worry business and ordinary folks. It feels like we’re all riding in a rickety ship that is sailing the open seas and being battered by huge waves with no clear sight of land mass. Which way, Philippines?

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

Prophets wanted!

Thursday, July 5, 2018 A7

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Believers in Jesus must be prophetic to the world at large and to the societies they live in by testifying to the Gospel of Jesus Christ. Only when we ourselves live according to the Word of God, and humbly and faithfully carry out the mission of being bearers of the two-edged sword, do we have the credibility to be teachers and models for others.

Better dead than alive

those sent to her (Matthew 23:37).

Prophets are wanted, better dead than alive!

Msgr. Sabino A. Vengco Jr.

Alálaong Bagá he Gospel reading (Mark 6:1-6) describes Jesus as He actually made it in public and the kind of reception He got.

Earlier on (3:21), He is pictured being thought crazy by His relatives, and now He is questioned and rejected by His townmates. Jesus is here evidently projected as a Prophet and with the destiny of a Prophet.

The astonishment in the hometown of Jesus at His words and deeds was not the sort that leads to belief, tracing their wonderment to the transcendent power at work in Him, and seeing Him as God’s transparency.

On the contrary, the perplexity of the people in Jesus’ native place was the first step toward rejection, as they thought they knew Him and His family and His work only too well and that He was overreaching Himself. They could not stomach His wisdom and power, and they put Him in his place: one of them, an ordinary human being who should be doing ordinary things. In His own interpretation of what was happening, Jesus was clear that, “A prophet is not without honor except in his

native place and among his own kin and in his own house.”

As the bearer of the Word of God and the ultimate revelation of the divine will, the Messenger of what is for our salvation, Jesus was for many too much to swallow. As a prophet, He was the conscience of the people, like a lightning that illuminates everything bare, a measuring rod that exposes crookedness and shortcomings. As the one sent by God, He challenged the people’s credulity that the ordinary does not exclude the extraordinary, that God works not only with official or learned or socially very important persons but also with one from the people. The tradition of prophets Jesus knew speaks of the favored city of Jerusalem killing prophets and stoning

Wanted more than ever

Our reading begins and ends with astonishment. The people in His native place were perplexed at the ability of Jesus to reveal the divine, and Jesus was amazed at His townmates’ inability to respond with faith to His revelation. But Jesus was not deterred. He went around teaching in other villages, and He summoned the 12 and sent them off to extend His mission in other places with the instruction: “Whatever place does not welcome you or listen to you, leave there and shake the dust off your feet” (Mark 6:11).

As Jesus was God’s Spokesman, so must now the assembly (katipunan) of His like-minded and like-hearted

No country for the ‘tambay’

can the government make all of them disappear? Let us examine some labor force statistics.

First, it should be pointed that there are no exact numbers. The Philippine Statistics Authority (PSA) does not gather specific data on who are and how many are the istambay. But one can deduce from the official labor force statistics where these istambay are coming from and how many Filipinos are likely to become part of the tambay army.

In the January 2018 labor force statistics released by the PSA, we find the following figures: The population of 15 years old and over is 70.9 million.

Out of this 70.9 million, 44.1 million are considered economically active or are in the labor force. This means a huge number—26.8 million —are “not in the labor force” (NILF).

The economically active consists of two major categories—the employed persons, numbering 41.8 million, and the unemployed, totaling 2.3 million (for an unemployment rate of 5.3 percent).

The underemployed or those employed but looking for more work were estimated to be 7.5 million, or 18 percent of the employed.

From the foregoing, where are the legislator and public servant, now enjoying his retirement from politics, was always in the center of contemporary Philippine history, from the time he served in the Marcos administration as defense minister, through his celebrated breakaway that ushered the People Power Revolution, to serving President Cory Aquino as her first defense secretary, and his election to both Houses of Congress, until he became Senate President.

Many observers at the time, in and out of the Aquino administration, agreed with most of the senator’s observations, much of which were common perceptions of the failings

of the Aquino administration.

Aquino’s first agriculture secretary, Ramon V. Mitra Jr., who later became Speaker of the House of Representatives and vocal critic of the Aquino regime, had this to say: “Repeatedly over the past 46 years, our democracy has been besieged by the hammer of rebellion and insurgency at one end and by the spectacle of weak and ineffective government at the other.

“At no time has this been more sharply highlighted than during the five-year period from 1986 to 1990—a period which began with so much promise and concluded

with so much pessimism and uncertainty.

“Over this brief time, the country became known to the world as the setting of pervasive coup attempts and as one of the last bastions of communist insurgency in the planet.

“The series of crises that have bedeviled the nation has put to doubt for some whether our present system can arrest the experience of decline and begin the process of national modernization.”

Continued from A1

H

owever, the reality on the ground is starkly different. A famous quotation from a French author, Anatole France (1894), captured the supreme irony on the theory and practice of legal egalitarianism as follows:

continued from A6

investment which entered the country in 1985—the last full year of the Marcos administration.

“If this were not convincing enough to show the unreliability of the boast of the Aquino administration, I do not know what would,” Enrile lamented.

In the center of history

The senator’s lament is not easily dismissed.

After all, the respected lawyer,

Join me in meditating on the Word of God every Sunday, from 5 to 6 a.m. on DWIZ 882, or by audio streaming on www.dwiz882.com.

of those classified as “not in the labor force” or NILF, numbering 26.8 million in January 2018. Traditionally, the NILF population consists of full-time students, full-time housewives and the disabled. Latest figures indicate that the total number of tertiary or college enrollees does not exceed five million. On the other hand, the concept of being a fulltime housewife is being rejected by more and more women. Very likely, a large number of “discouraged workers” are lumped in the NILF. They are economically idle and are likely to be part too of the tambay nation.

Also, not all who are employed or who have work spend 40 to 48 hours of the week working. In particular, about half of the underemployed are “visibly underemployed” for they are not working full time; hence, part of the time or the week they spend at home or in their neighborhood, doing loitering, too.

In addition, the PSA has some statistics on work hours. It appears that at least 15 percent of the 41.8 million employed work less than 20 hours a week, or virtually two-and-a-half days if reckoned based on the regular eight-hour work schedule. What do these workers do the rest of the week? Again, a number of them are likely to be part of the huge tambay population.

So what will the government do to make this population disappear?

Round them up? You need millions of police enforcers to make this happen because there are millions in the ranks of the istambay.

What then is the realistic alternative? The quick answer: Make growth and job creation truly inclusive, decent and sustainable for all.

This, of course, requires more intensive policy debates in the Cabinet and consultations with the people, including representatives of the istambay themselves.

LABOREM EXERCENS

Arillo . . .

Alálaong bagá, conscience in any form is discomforting. Nobody would like to be measured and found wanting. That is why prophets are not popular. But woe to the Church when she becomes identified with the institutions that need to be challenged in the light of God’s will. Woe to the Christian community that has lost its voice and flees from confrontations that give no earthly rewards. And woe to us when we prefer to silence the voice of prophets, or when we ourselves shirk the martyrdom of prophets. Prophets are wanted and needed now more than ever!

tambay likely to come from? Commentators readily cite the unemployed, who numbered 2.3 million in January 2018. The reality, however, is that not all unemployed are loitering around because they are seriously looking for jobs, online or off, in various establishments and places.

On the other hand, a certain percentage of the unemployed are members of labor gangs or labor pools for certain industries such as construction. Members of these gangs or pools do not have regular jobs and usually wait for new “job orders” from job contractors or recruiters who visit their neighborhood. In this sense, loitering around serves some kind of a useful purpose—waiting for productive job opportunities to come in their neighborhood.

Of course, there are unemployed who simply do not know where to find jobs and have very little to do at their tiny and congested homes.

They stay outside and link arms— and share thoughts and ideas—with other jobless in the neighborhood, to while away precious time and wait for job opportunities to come by.

The last two categories of jobless are joined by the “discouraged workers,” workers who are not looking for work because they failed, repeatedly, to find ones in their previous efforts and are resigned to the fact that they will not find any. Under the PSA system, the unemployed, to be so classified as unemployed, must be of working age, without work, actively looking for work and are available for work. In other countries, the labor statistical bureaus exert extra efforts to determine who are the “discouraged workers” who cannot be categorized as “unemployed” simply because they are no longer looking for work.

In the Philippines, the “discouraged workers” are likely to be part

Dr. Rene E. Ofreneo

“In its majestic equality, the law forbids rich and poor alike to sleep under bridges, beg in the streets, and steal loaves of bread.”

In real life, the situation indeed is less than majestic from what the law says. In a society divided between a privileged few and the numerous poor, the former always get priorities in various areas of social life and get legal protection for all this.

In contrast, the poor get discriminated, socially and legally, in so many ways. A good example: housing. The financially capable can enjoy the safety and warmth of their palatial homes, while the homeless poor try to build shanty homes out of cardboards in vulnerable areas like esteros, or worse, end up sleeping on sidewalks. The law, of course, does not tolerate building houses on esteros and sleeping on sidewalks.

Now comes the campaign of the government of President Duterte to spruce up the image of the country—no more istambay, no half-naked men loitering around, no idlers occupying the street corners and so on. Does the President want these istambay to disappear?

Nationwide?

There are so many tambay. How

(kadiwa and kapuso) followers, the Church, be the prophetic community in the world that perseveres in proclaiming Jesus’ Gospel of Life and Truth. Evangelization is not an empty shibboleth but the primary manifestation of the life of the Christian body. Believers in Jesus must be prophetic to the world at large and to the societies they live in by testifying to the Gospel of Jesus Christ.

Only when we ourselves live according to the Word of God, and humbly and faithfully carry out the mission of being bearers of the two-edged sword, do we have the credibility to be teachers and models for others.

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

2nd Front Page BusinessMirror

A8 Thursday, July 5, 2018

ADB lines up $7.1-B loans to PHL over next 3 years

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By Cai U. Ordinario

@cuo_bm

HE Asian Development Bank (ADB) will extend some $7.1 billion worth of loans to the Philippines in the next three years.

The Manila-based multilateral development bank, the National Economic and Development Authority, and the Department of Finance recently signed the memorandum of understanding for the sovereign lending program to the Philippines from 2019 to 2021. “ The ADB is committed to working closely and collaboratively with the government of the Philippines to ensure that we deliver on our pipeline of projects,” said ADB Country Director for the Philippines Kelly Bird after the signing ceremony.

The government’s “Build, Build, Build ” (BBB) program will be

supported by the proposed lending program, with two-thirds of the ADB pipeline, or about $4.5 billion.

These projects aim to connect regions and communities and manage urbanization, such as railways, bridges, roads and flood management.

The remaining one-third of the pipeline, or $2.6 billion, will be allocated for policy support and social assistance in the areas of inclusive finance, capital market development, local government development and youth employment.

The ADB said the agreement covers an indicative three-year rolling program that is revisited annually.

$4.5B

The amount from the ADB’s Philippine pipeline that will support the “Build, Build, Build” infrastructure program “I am very happy about this program,” said Socioeconomic Planning Secretary Ernesto M. Pernia.

“The ADB has been very cooperative and helpful in our objectives to sustain our economic growth and achieve inclusive development.

This will help bring us closer to our longer-term vision of a prosperous, middle-income country, where no one is poor by 2040.”

The details of the pipeline will be disclosed in the upcoming Country Operations Business Plan (COBP) for 2019-2021, which is slated for approval by the ADB Board of Directors next month.

However, the ADB said the

COBP will focus on accelerating infrastructure and long-term investments and promoting local economic development.

The plan will also focus on human capital investments which will support the government’s objective of lowering poverty to 14 percent of the population by 2022, from the current 21.6 percent.

“The ADB has been a very responsive partner,” said DOF Assistant Secretary Maria Edita Tan. “When we asked them to consider cofinancing some of the large infrastructure projects under the BBB program, the ADB immediately stepped up to the challenge.”

Also present at the ceremony were officials from implementing agencies, such as the Department of Public Works and Highways, Department of Transportation and Department of the Interior and Local Government.

Established in 1966, the ADB is owned by 67 members—48 from the region. In 2017 the ADB operations totaled $32.2 billion, including $11.9 billion in cofinancing.

OECD: Philippines will meet growth targets, keep inflation in check

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HE national government may attain its economic growth targets under the Duterte administration, according to the Organisation for Economic Cooperation and Development (OECD).

In a report, the OECD said the economic growth of Vietnam, In-

donesia and the Philippines may average 5 percent to 7 percent annually in the medium term.

The OECD is a group of 34 countries and includes the world’s richest countries, such as Australia, Canada, France, Germany, the United Kingdom and the United

States, among others.

“Emerging developing countries in Southeast Asia are projected to continue experiencing robust growth over the medium term, at least matching their performance of the previous decade,” the OECD said.

The OECD expects inflation to also be within check this year. It said inflation would average around 3.9 percent, which is below government expectations.

On Monday the interagency Development Budget Coordination Committee (DBCC) decided to adjust inflation projections to a range of 4 percent to 4.5 percent this year and 2 percent to 4 percent annually between 2019 and 2022.

The OECD expects food inflation to average 4.5 percent in 2018, from 3.4 percent in 2017.

The Philippines’s food inflation is expected to be higher than Malaysia, Singapore and Thailand this year.

“Inflation rates are projected to increase over the next few years in both advanced and emerging market and developing economies, reflecting the recovery in demand and the increase in commodity prices, including energy prices,” the OECD said.

The national government targets to grow the economy by 7 percent to 8 percent in the medium term and reduce poverty incidence to 14 percent from the current 21.6 percent.

T h is w i l l cont r ibute to efforts to increase per-capita income levels to upper middleincome country levels as early as next year.

This will also be in line with the Philippines AmBisyon to become a high-income country by 2040.

The Philippines is considered a lower middle-income country with a per-capita GNI of around $3,500 as of 2016.

The World Bank said lower middle income economies, like the Philippines, have a GNI per capita of between $1,026 and $4,035.

As of 2016, the World Bank said low-income economies are defined as those with a GNI per capita, calculated using the World Bank Atlas method, of $1,025 or less in 2015.

Upper middle-income economies are those with a GNI per capita of between $4,036 and $12,475; while high-income economies are those with a GNI per capita of $12,476 or more.

Cai U. Ordinario

www.businessmirror.com.ph

FRANCHISING TO GROW TO $24B BY 2020, BUCKING SLUMP IN OTHER SECTORS Continued from A1

“Conservatively speaking, [we are looking to grow by] 10 percent to 15 percent [this year], but we are internally looking at 15 percent to 20 percent. [To grow by] 20 percent is very doable, and I’m optimistic we can hit 20-percent growth,” Sanz added.

He asserted that indicators favor the sector, starting with the number of registrations in the first half of the year, which jumped by 250 percent year-on-year. “In fact, we’ve seen more and more people go to franchising. The registrations, if you look at that indicator, it grew 250 percent from the same period last year,” Sanz said.

The PFA chief said he expects this number to expand this month, with the group’s hosting of the Franchise Asia Philippines 2018. “It means the interest is high, and, of course, we’re looking at at least P3 billion of investments for [this event],” he added.

“That’s quite an increase from the previous year. That’s additional new investments. That’s how alive [the sector is], despite high inflation. Even if we are experiencing high inflation and now the peso is very weak, if there is a slowdown in franchising, it would reflect in the registrations,” Sanz pointed out.

Asked why the industry is stable in spite of economic challenges, he pointed to to the “outlier” characteristic of franchising as an industry. “It is really different from the other sectors, mainly because what we are offering is not just a product, but a business, a livelihood. Given the success rate, people want to put their money in hard times into something that is safe.

Growth. . .

Continued from A1

five months of 2018 alone, representing an increase of 42 percent over the same period last year, on top of private-sector construction and public-sector projects financed through public-private partnerships (PPPs).

“The mammoth investment will have a tremendous impact on investment growth and job generation. It will stimulate the economic expansion and help us realize a 7 percent or better GDP [gross domestic product] growth rate per year. It will help disperse economic activity by ensuring no island or community is left behind. It will improve our competitiveness by bringing down the costs of moving goods and people across our country,” Dominguez said. ​With the P281-billion investment ​​o​n infrastructure during the first five months of the year, the government is ​averaging close to P56 billion a month in spending on the BBB, Dominguez said. “​T he BBB will drastically alter the Philippine economic landscape.

It will create over a million jobs per year. It will bring our logistics backbone up to par in a region that is growing very dynamically,” he added.

He said that combined with other reforms, such as the modernization of the ta x system and improvements in the ease of doing business, the Duterte administration envisions the infrastructure program to reduce poverty incidence by a third of the 2015 level of 21.6 percent to just 14 percent by 2022.

“This will be the absolute measure of success of our strategy of inclusive growth. This is the goal that has been set for us by President Duterte, and this is how we are implementing it. We fully aspire to be the fastest-growing economy in the fastest-growing region in the world. This will not be an easy task to accomplish. But we are ready to

When you look at the success rate, [it is at] 90 percent—very attractive and high return—and that’s why franchising is very vibrant during hard times,” Sanz said.

According to the PFA, the Philippines is currently home to 2,000 franchise brands, is ranked eighth in the world, and has over 200,000 franchise stores nationwide employing more than 1.2 million Filipinos.

If there is one challenge the industry is facing, PFA Vice Chairman Maria Alegria Sibal-Limjoco pointed to the lack of government support for franchising. She said the sector learned to walk on its feet alone without backing from the government.

She said the best the government can do is to continue bringing franchises abroad through trade shows, which she noted the Department of Trade and Industry (DTI) did twice—one in Dubai, and the other in Indonesia. She also said the PFA will appreciate it if the DTI carries on with this initiative, as it entices foreign businessmen to buy Filipino franchises.

Sanz, for his part, said it is enough that the DTI is persistent in developing micro, small and medium enterprises (MSMEs). He added that funding is welcome, but capacitybuilding programs for MSMEs are more than enough.

The 26th edition of Franchise Asia Philippines is slated from July 18 to July 22 at the SMX Convention Center in Pasay City. The annual event is expected to attract huge number of conference delegates and expo visitors, as it averages about 1,000 participants and 50,000 guests.

meet the challenges, driven by the optimism of our people, the confidence of our development partners and the leadership of President Duterte,” he said.

The BBB team also showcased the area wherein the New Clark City is envisioned to be built. The New Clark City is among the 75 high-impact flagship projects of the Duterte administration under its BBB program. It is within the Clark special economic zone spanning from Angeles City ​in Pampanga and the towns of Capas and Bamban in Tarlac.

Construction is set to start this year on three main structures inside the City, namely: the P1.78billion Clark Green City Government Center; the P850-million Clark Commercial Center; and the P3.33- billion Clark Mixed-Income Housing, according to data from the International Finance Group (IFG) of the DOF. Dominguez pointed out that the New Clark City will soon be connected to Metro Manila by the second stage of the Philippine National Railways (PNR) North Line, and will be linked to the Subic Freeport by another high-speed rail line.

“We are seeing here today the birth of a new metropolis. The New Clark City will bring in several hundred enterprises and billions in new investments. The excellent logistics and the prospective rail link to Subic will make this area an ideal place to build manufacturing, especially food processing and other export industries,” he added.

“All the developments you see around you are part of a plan to decongest Metro Manila by interconnecting this part of the country and investing in new growth centers,” Dominguez said.

The BBB program is funded by official development assistance loans and grants, the government’s sale of debt securities in the offshore market, financing from multilateral institutions, hybrid PPPs, and revenues generated from the implementation of the Tax Reform for Acceleration and Inclusion law.