Businessmirror july 11, 2016 by BusinessMirror

Q&A: Landmark ruling on South China Sea

landmark ruling on an arbitration case filed by the Philippines that seeks to strike down China’s expansive territorial claims in the South China Sea will be a test for international law and world powers. China, which demands one-on-one talks to resolve the disputes, has boycotted the case and vowed to ignore the verdict, which will be handed down on Tuesday by the United Nations tribunal in The Hague.

Some questions and answers about the case What’s the case about?

After years of diplomatic negotiations ended nowhere, the Philippines brought its dispute with China to international arbitration in January 2013, despite Beijing’s warnings of a diplomatic and economic backlash. China wants to negotiate directly with the Philippines and each of the four other claim-

media partner of the year

ants in an arrangement that would give it leverage for its sheer size and influence. Beijing has steadfastly opposed bringing the disputes to an international arena, which could provide the US a chance to intervene. The Philippines asked a tribunal of five arbitrators to declare as invalid China’s vast claims, known as nine-dash lines for the dashes that demarcate virtually all of the South China Sea as Chinese territory, under the United Nations Convention on the Law of the Seas, (Unclos). China and the Philippines are among more than 160 signatories of the 1982 convention, regarded as the constitution that governs and stipulates the rights of countries in using the world’s oceans. With China’s sprawling claims, the Philippines stands to lose a huge chunk of offshore territory, said Antonio T. Carpio, an associate Supreme Court justice who has made extensive studies on the conflicts. “This Chinese aggression is the gravest external threat to the

Philippines since World War II,” he said. The Philippines also asked the tribunal to classify whether a number of disputed areas are islands, low-tide coral outcrops or submerged banks to determine the stretch of territorial waters they are entitled to under the convention. It also wants China to be declared in violation of the convention for carrying out fishing and construction activities that breached the Philippines’s maritime rights. The convention does not deal with sovereignty questions, which the Philippine government says it did not raise.

How did it start?

Although the disputes have simmered for decades, they gradually escalated under former Philippine President Benigno S. Aquino III and culminated in 2012, when China took effective control of the disputed Scarborough Shoal after a tense standoff. Continued on A16

This May 1 file photo shows an illuminated globe of the South China Sea at a museum in Pathumthani, Thailand. Five judges of a United Nations tribunal will deliver on July 12 their landmark ruling on South China Sea disputes—and Beijing is already dismissing a potentially unfavorable outcome. The Permanent Court of Arbitration will decide on a 2013 case filed by the Philippines, which asked the court to declare China’s territorial claims that encompass most of the South China Sea invalid because they infringe upon the country’s own 200-mile exclusive economic zone. AP

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A broader look at today’s business

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Monday, July 11, 2016 Vol. 11 No. 275

CA junks Nestlé bid to block San Miguel use of coffee label This Court finds that HE Court of Appeals (CA) the director general has favored San Miguel Corp. of the IPOPHL is (SMC) and its campaign correct in saying to register its marks and design that there is no confusing similarity for a coffee product to which the Swiss transnational food and drink between the marks of petitioner and company Société Des Produits respondent.”

By Joel R. San Juan

Continued on A16

BMReports

TIME TO TRI According to the commandments

EAR Lord, from the scriptures it is said, “Because of the commandment, help the poor, and in their need, do not send them away empty-handed. Lose your money for relative or friend; do not hide it under a stone to rot. Dispose of your treasure according to the commandments of the Most High, and that will profit you more than the gold. Store up alms giving in your treasury, and it will save you from every evil.” (Sirach 29 :9-12). According to the commandments, which is the law, when we comply with them, we are assured of our place in heaven. Amen. Give Us This Day, CommiTTee on Divine Worship, shareD by LUisa m.LaCson, hFL Word&Life Publications • teacherlouie1965@yahoo.com

Editor: Gerard S. Ramos • lifestylebusinessmirror@gmail.com

Life

Apl De Ap

ToTa pULChra MISS CHARLIZE

@misscharlize

yMnAStIcS, volleyball and synchronized swimming are the sports I’m a superfan of. I get engrossed with football once in a while because seven of my brothers are players, and with basketball because of my Xavier University highschool batch mates. triathlon, I barely know. Maybe because no filipino has attained international glory in this grueling discipline, or its elitist appeal hasn’t crossed over to the mainstream. It also needs a globally recognizable “face,” such as Muhammad Ali for boxing, tiger Woods for golf and Serena Williams for tennis. A visit to ironman.com yields this interesting tidbit: “During an awards banquet for the Waikiki Swim club, John Collins, a naval officer stationed in Hawaii, and his wife Judy, began playing with the idea of combining the three toughest endurance races on the island into one race. they decided to issue a challenge to see

BusinessMirror

Time to tri

CHIldren on the run

and then some:

What Marian has learned froM Zia

Monday, July 11, 2016

MAtteo GuiDicelli

piolo pAscuAl

who the toughest athletes were: swimmers, bikers, or runners. On february 18, 1978, 15 competitors, including collins, came to the shores of Waikiki to take on the first-ever Ironman challenge: “Whoever finishes first, we’ll call him the Ironman.” A click to Wikipedia gives you this nugget: An Ironman 70.3, also known as a Half Ironman, is one of a series of long distance triathlon races organized by the World triathlon corp. (Wtc). the “70.3” refers to the total distance in miles (113.0 kilometers) covered in the race, consisting of a 1.2-mile (1.9-km) swim, a 56-mile (90-km) bike ride, and a 13.1-mile (21.1-km) run. each distance of the swim, bike and run segments is half the distance of that segment in an Ironman triathlon. this state of blissful ignorance is about to disappear, when the province of cebu plays host to the cobra energy Drink Ironman 70.3 Asia Pacific Championships on August 7. All the hype and hyperventilation leading to the international event have pushed the sports into the national consciousness as close to 3,000 triathletes from more than 40 countries are set to participate. triathletes, as far as I’ve seen, have the fittest, healthiest and most beautiful physiques. “the province will be ready to welcome all the participants and their families with the traditional cebuano warmth and festivities,” promised Atty. Mark tolentino, the provincial administrator of cebu. “never in my wildest imagination [did I think] that this will happen—the Asia Pacific Championships. It’s never been held outside Australia. We are very privileged and, at the same time, pressured, because it is now the chance for the Philippines to shine and show them what we can do,” an overwhelmed fred Uytengsu said at the Sinulog-themed Ironman 70.3 launch at the Shangri-La at the fort in taguig. the cebuano owner of the Philippine Basketball Association team Alaska Aces also happens to be the president of Sunrise events Inc., the producer and organizer of the event. The Asia Pacific Championships, presented by Ford, with Globe as official wireless and broadband services partner, will start and end at Shangri-La’s Mactan resort and Spa in Lapu-Lapu city. the swim (1.9 km) starts at Shangri-La Mactan

Beach, while the bike course (90 km) covers four cities and the run (21 km) will be along Punta engano on the northern tip of Mactan. A whopping $75,000 in prize money is up for grabs, with 50 qualifying age-group slots for the 2017 Ironman 70.3 World championship in chattanooga, tennessee. the 2016 Ironman 70.3 World championship, which will be held in Mooloolaba, Queensland, Australia, on September 4, already had a series of qualifying events from July 19, 2015, through July 3, 2016. the current world champions, who won in Zell am See-Kaprun, Austria, on August 30, 2015, are Jan frodeno of Germany and Daniela ryf of Switzerland. Bronze medalist Javier Gomez of Spain will compete in rio 2016 for Spain. Meanwhile, the reigning pro champions of Asia Pacific Tim Reed of Australia and Caroline Steffen of Switzerland will defend their titles in cebu next month. Other world-caliber triathletes competing are tim Van Berkel (Australia), Brent McMahon (canada), Matthew franklin (new Zealand), Antony costes (france), Ivan Kalashnikov (russia) and young-Hwan Oh (South Korea) for the males. the top-level women’s international roster include Kathryn Haesner (new Zealand), radka Vodickova (czech republic) and Judith corachan Vaquera (Spain). there are also local celebrities who will join “arguably the most difficult one-day sporting event in the world.” the courageous and ambitious include Piolo Pascual, Matteo Guidicelli, Paul Jake castillo, Dingdong

Kids in conflict with the law and lowering of criminal liability

WilfreD uytenGsu

Dantes, Apl de Ap and Anthony and Maricel-Laxa Pangilinan. Guidicelli, who competes with his team ford forza, will be joined by his father Gianluca. Some say the Ironman 70.3 offers half the distance but double the fun. Ironman veteran, sports chiropractor and manual therapist Dr. Kyle Worell explains it best to Lisa Dolbear, a three-time Ironman and triathlon coach, for her article on ironman.com: “Overall, when you consider all of the stressors an athlete undergoes to train and race at the Ironman level, it makes sense that an Ironman 70.3 would be easier on the body overall. But it really comes down to long-standing wear and tear on the musculotendinous and soft tissues. Constant training for a full Ironman will invite more risk for injury to the body. Doing an Ironman 70.3 decreases muscular stress due to the lower training volume. for the regular 140.6 athlete, it can be a nice opportunity to give the body a break without losing the thrill of the long course.”

Do PPP contracts fall under the PHL Competition Act?

@jrsanjuan1573

Nestlé S.A. has strong objections. INSIDE

P25.00 nationwide | 6 sections 40 pages | 7 days a week

PPP Lead

an a public-private partnership (PPP) arrangement be considered anticompetitive and punishable under the Philippine Competition Act (PCA)? Are PPP contracts under the jurisdiction of the Philippine Competition Commission (PCC)? Can a winner of a PPP award be in abuse of a dominant position prohibited under the PCA? Does the PCA repeal or amend the build-operateand-transfer (BOT) law? Must there be prior notice to the PCC before the government awards a PPP contract to a private-sector proponent (PSP)? Continued on A15

don’t let the rain dampen your style

fter a seemingly endless summer, the rainy season is here to freshen things up, especially our wardrobes. While we trade tank tops for sleeves, one part of our ensemble remains the same: GAS Jeans denim that comes in the perfect fit. the premium Italian denim brand, which has setup shop in Greenbelt 3, Makati, breathes new life into stylish filipinos’ favorite blue fabric with hand-dyed washes and tapered cuts that complement their equally varied lives. through the downpour, GAS Jeans (www.gasjeans.com) in relaxed cut, straight cut, slim, skinny and boot cut are your all-weather closet staples. Dress as bright or as dark as the ever-changing Manila skies with jeans that come white-washed and in various shades of blue. Made with 98-percent cotton and 2-percent elastic, GAS Jeans are the perfect match for sudden changes in weather and sartorial tastes.

life

Bills seek to erase 5.5M housing backlog in PHL

U.S. POLICE ON EDGE AMID THREATS

The World BusinessMirror

A8 news@businessmirror.com.ph • Monday, July 11, 2016

US police on edge amid threats

TLANTA—Police agencies across the US are on edge and on guard after receiving threats and calls for violence against them on social media in the aftermath of the killings of two black men and the sniper attack that left five officers dead in Dallas. Some departments ordered officers to pair up or more generally said they were heightening security.

Authorities have said the Dallas gunman, who also wounded seven other officers and two civilians, wanted to “exterminate” whites in the aftermath of the killings of Philando Castile in Minnesota and Alton Sterling in Louisiana. A man who killed one person and wounded three others—including an officer—in Tennessee apparently told investigators he was motivated by the recent killings of black men by police. Since then, threats ranging from generic promises of violence to specific video postings have been made, only heightening fears of further attacks.

In Dallas authorities received an anonymous threat on Saturday, prompting police to tighten up security. Officers swarmed the department’s headquarters, searching for a reported suspicious person in a garage before finally issuing an all-clear. While some threats have been unspecific and not credible, other promises of violence have been more targeted. In Louisiana a man was accused of posting a video online showing him in his vehicle behind a police car, saying he wanted to shoot and kill an officer. The police say Kemonte Gilmore flashes a handgun

in the video and talks about the slayings of Castile and Sterling. The police also say a Wisconsin man posted calls on social media for black men to gun down white officers, and a woman in Illinois is accused of threatening in an online video to shoot and kill any officer who pulled her over. In Mississippi, Waveland Police Chief David Allen told The Sun Herald newspaper threats had come via phone and social media and involved possible gunfire attacks over the weekend. Extra police were to be on duty. Mawuli Davis, an AfricanAmerican attorney and activist in Atlanta, said what’s happening is a continuation of events in recent years because there has been no serious dialogue over issues of race and police encounters with black people. Davis and his associates insist on peaceful protests as a means to an end, and indeed, most protests across the US have gone on without a hint of violence. But until that serious discussion happens, he said he fears “we’re going to continue to see this kind of tragic incident” like the Dallas attack. “From an activist perspective, you’re seeing a level of frustration and anger that very well may be at a tipping point,” he said. Tensions between police and African-Americans have been on the rise in recent years amid the high-profile deaths of several black men at the hands of law enforcement. The deaths have fomented unrest from Ferguson, Missouri,

to Baltimore and heightened calls for greater accountability of police, particularly in the urban, majorityblack neighborhoods they patrol. While race has not necessarily been a factor in every case, the deaths have become a rallying cry for groups such as Black Lives Matter who are calling for solutions to problems that plague African-American communities, from poor educational opportunities to joblessness to high incarceration rates. Organizations that monitor hate groups condemned the Dallas attack, with the Southern Poverty Law Center calling it “an act of domestic terrorism.” The gunman, Micah Johnson, followed black militant groups on social media. Ryan Lenz, online editor and senior writer at the SPLC, told The Associated Press that the number of black separatist groups nearly doubled in 2015, mirroring a similar increase among white hate groups that has come against the backdrop of police killings that make frequent headlines. While some committing violence may be influenced by hate groups, many who become radicalized do so without direct ties to the groups. Instead, they surf the Web and allow their anger to grow in private at home, Lenz said. “In the last couple of years we’ve seen this violence become an everpresent reality in our lives,” Lenz said. “We are in a polarized political climate right now where the ‘usversus-them’ mentality has started to reign supreme.” AP

How, why Dallas police used robot bomb to kill sniper

ALLAS—It was a little after 1 a.m. on Friday when Dallas Police Chief David Brown told Mayor Mike Rawlings that he planned to kill the sniper who gunned down five police officers—and how he planned to do it. The mayor and the chief had rushed to Parkland Memorial Hospital to be with the families of fallen officers even as a standoff with the gunman continued downtown. “When we got out at Parkland the chief told me, ‘OK, I’ve made the decision that we’re going to blow this guy up,’” Rawlings said on Saturday. Specifically, Brown told the mayor that officers would use a remote-controlled robot to detonate a brick of plastic explosive—C4. Police departments across the country have been training for that very scenario for years. But this is believed to be the first time a chief has ever made the call to use explosives to kill a suspect and end a standoff. Rawlings detailed for the first time how and when Brown made the decision—one Rawlings said he was “very happy” with, both at the time and after the mayor learned Dallas had done something no other department has done. “As I talked to [Brown] about the upside of that decision,” the mayor said, “it sounded good to me.” Rawlings and Brown held two news conferences immediately after the shootings that left five officers dead and nine injured, including two civilians. The first conference came at 10:45 p.m. on Thursday, the second at 12:30 on Friday morning. Discussions about how to end the standoff took place between those two media updates. It was in the city’s Emergency Operations Center, in the basement of Dallas City Hall, that Brown considered the possibility of using a bomb to end the life of Micah Xavier Johnson, a 25-year-old Army reservist bent on killing white people, and particularly white officers, according to the chief.

At a news conference at 12:30 a.m. on Friday, Brown told the media that Johnson had been “exchanging gunfire” with officers and that he “was not being very cooperative in these negotiations.” Brown said Johnson told negotiators that “the end is coming, and he’s going to hurt and kill more of us—meaning law enforcement—and that there are bombs all over the place, in this garage and downtown.” Brown, who was not available for this story, then stressed that police were “being very careful in our tactics so we don’t injure or put any more of our officers in harm’s way, including the citizens of Dallas, as we negotiate further.” Brown told the media he had asked for “plans to end the standoff,” and that he was expecting to receive those plans immediately after the news conference—and before he and the mayor headed to Parkland and Baylor University Medical Center to visit with families of the slain and injured officers. Before they left in separate vehicles, Rawlings and Brown spoke briefly. During that conversation, Brown told the mayor he was weighing two ways to kill Johnson. The mayor said Brown and others “felt they had to take him out at that time, because he was threatening to blow up the place.” But the chief didn’t detail the two plans he was considering. All Rawlings knew was that one involved storming the parking garage— “some sort of raid,” said the mayor, “charging this guy.” But police believed Johnson was wellprotected and heavily armed. Rawlings said they had reason to believe he “had the vest on and was mag’d up,” meaning he had plenty of ammunition and possibly was carrying explosives. The chief wasn’t specific about his other option, either, telling the mayor only that it involved “using this bomb detonator.” After he’d been briefed, Rawlings started to leave for Parkland. But he waited, so he and his contingent could follow the chief over and

WORLD

By Jovee Marie N. dela Cruz

2-TROPHY DAY FOR SERENA

A group of youth plays basketball under the rain in front of the House of Representatives in Quezon City. ALYSA SALEN

Sports

By Joel Pablo Salud

BusinessMirror

Special to the BusinessMirror

| Monday, July 11, 2016 mirror_sports@yahoo.com.ph sports@businessmirror.com.ph Editor: Jun Lomibao Asst. Editor: Joel Orellana

Williams tops Kerber at Wimbledon, ties Graf’s slam 22-title marK

By Howard Fendrich

L american serena Williams raises her trophy after winning the women’s singles final against angelique Kerber (left) of Germany of the Wimbledon tennis championships. AP

The Associated Press

ONDON—Serena Williams insisted she was not focused on No. 22. Said she wouldn’t discuss it. Kept coming close without quite getting it. Now she finally has it. And so she can flaunt it. Williams lifted both arms overhead and raised two fingers on each hand right there on

QUEEN OF SLAM

Centre Court to show off the magic number after winning her record-tying 22nd Grand Slam title by beating Angelique Kerber, 7-5, 6-3, in the Wimbledon final on Saturday. “Definitely had some sleepless nights, if I’m just honest, with a lot of stuff,” Williams said. “My goal is to win always at least a Slam a year. It was getting down to the pressure.” She pulled even with Steffi Graf for the most major championships in the Open era, which began in 1968. Now Williams stands behind only Margaret Court’s all-time mark of 24.

This was Williams’s seventh singles trophy at the All England Club—only Martina Navratilova, with nine, has more in the Open era—and second in a row. The victory at Wimbledon a year ago raised her Grand Slam count to 21, where it remained until Saturday. “It’s been incredibly difficult not to think about it. I had a couple of tries this year,” said Williams, who went back on court a few hours later to win the doubles title with older sister Venus. “But it makes the victory even sweeter

2-TROPHY DAY FOR SERENA L

ONDON—Serena Williams is leaving Wimbledon with two trophies, teaming with her older sister Venus to win a women’s doubles final that began a little more than three hours after the singles final ended on Saturday. The American siblings won their sixth doubles championship at the All England Club and 14th as a pair at all Grand Slam tournaments by beating fifth-seeded Timea Babos of Hungary and Yaroslava Shvedova of Kazakhstan, 6-3, 6-4. Earlier on Saturday, also on Centre Court, Serena collected her 22nd Grand Slam singles title with a straight-set victory over Angelique Kerber in that final. “I had just enough time to change and get my ankles re-taped,” Serena said about going from one match to the other. “But there was so much adrenaline. I didn’t want to cool down too much.” Venus sat in the guest box during the singles final. “Watching Serena earlier was so amazing, and I was so into that. And then you have to re-set yourself and say, ‘OK, we’ve got to play a match and we’re going to have to try to win,’” Venus said during a joint interview with the BBC after the doubles. “So she brought the energy from Game One and that really brought me up, too.” The Williams sisters also won doubles titles at Wimbledon in 2000, 2002, 2008, 2009 and 2012. Each time, one or the other also won the singles championship, with Serena doing it in 2002, 2009 and 2012 in addition to this year. They’re now 14-0 in major doubles finals. But they were unseeded this time because they play doubles so infrequently, and their most recent Grand Slam title before Saturday had come four years ago at the All England Club. Until playing at the French Open in May, they hadn’t even entered a doubles draw at any major tournament since 2014. They’re planning to compete in doubles, in addition to singles, at the Rio de Janeiro Olympics next month. They already have won three gold medals in doubles, at the 2000, 2008 and 2012 Summer Games. When they were asked during the BBC interview which one is in charge of their doubles team, Serena immediately pointed toward Venus and said with a laugh, “She’s definitely the boss.”

And Venus said: “Well, I’m the older sister, so it kind of falls on me. But [there are] different times on the court that we both take over. So whatever the team needs, it kind of happens organically. That’s the best kind of team.” Shvedova, who lost to Venus in the singles quarterfinals this week, was trying to win her third Grand Slam doubles title, after teaming with Vania King for trophies at Wimbledon and the US Open in 2010. Babos has never won a major doubles trophy; she was the runner-up with Kristina Mladenovic at Wimbledon in 2014. In men’s doubles, Nicolas Mahut and Pierre-Hugues Herbert defeated Julien

Benneteau and Edouard Roger-Vasselin, 6-4, 7-6 (1), 6-3, to win their first Wimbledon title. It was the first all-French Grand Slam men’s doubles final of the Open era. The victory gives Mahut a happier memory from the grass-court tournament where he lost the longest match in tennis history, 70-68 in the fifth set against John Isner in the first round of singles in 2010. “We talk a lot about this match already. I’m very proud of it,” Mahut said, referring to the contest that lasted more than 11 hours, spread over three days. “But now it’s something different. Now I can come in the press conference as a Wimbledon champion. It’s great.”

This is the second major title together for the top-seeded team of Mahut and Herbert, who won the US Open last year. They’re only the second pair of Frenchmen to earn the doubles trophy at the All England Club in the Open era, which began in 1968. Arnaud Clement and Michael Llodra won Wimbledon in 2007. Benneteau and Roger-Vasselin won the 2014 French Open doubles championship. Mahut knows Benneteau and RogerVasselin rather well, having won Association of Tennis Professionals doubles titles with each of them in the past. Mahut and Benneteau even had success together as teens, collecting seven junior doubles titles in 1999. AP

Alberto C. Agra

serena Williams (left ) and Venus Williams of the United states hold their trophies after winning the women’s doubles final against Yaroslava shvedova of Kazakhstan and timea babos of Hungary. AP

to know how hard I worked for it.” There was a stunning loss to Roberta Vinci in the US Open semifinals in September, ending Williams’s bid for a calendar-year Grand Slam. Then losses in finals to Kerber at the Australian Open, and to Garbine Muguruza at the French Open. “Time heals,” said Williams’s coach, Patrick Mouratoglou. “By losing, you realize things.” In the rematch against the fourthseeded Kerber—the first time in a decade two women met to decide multiple major titles in a single season—the No. 1-ranked Williams came through. This goes alongside six championships at the US Open, six at the Australian Open and three at the French Open. The 34-year-old American did it, as she often does, with nearly impeccable serving. She slammed 13 aces. She won 38 of 43 first-serve points. She faced just one break point—at 3-all in the second set, representing Kerber’s only real opening— and shut the door emphatically with aces at 117 mph and 124 mph. There was more that Williams did well, though. Much more. Facing the left-handed Kerber’s reactive, counterpunching style, Williams dictated exchanges and compiled a 39-12 edge in winners. Williams hammered second serves that floated in at 75 mph, breaking once in each set. She volleyed well, too, winning the point on 16 of 22 trips to the net, including a tap-in on match point. Soon, she was wrapping Kerber in a warm embrace, then holding up those fingers to symbolize “22.” “I was trying everything, but she deserved it today. She really played an unbelievable match,” said Kerber, who hadn’t appeared in a major final until beating Williams in Melbourne. “I think we both [played] on a really high level.” Kerber, a German who knows Graf well, defeated Venus in the semifinals and hadn’t dropped a set until Saturday. But she could not keep up with the trophy on the line, although it was a high-quality final that was tighter than the scoreline might indicate. “Played a good match,” Kerber said. “That makes it a little easier for me.” Later Saturday, Williams earned a second piece of hardware when she and Venus defeated Timea Babos and Yaroslava Shvedova, 6-3, 6-4, for their sixth doubles trophy at Wimbledon and 14th from all majors. In singles, Williams got better as the tournament went along, taking the last 12 sets she played after dropping a tiebreaker to open her second-round match against Christina McHale. After that set, Williams smashed her racket and flung it away, drawing a $10,000 fine. There had been some thought that Williams was really stung by her loss to Vinci in New York, that it was too big a disappointment to push aside and lingered, somehow, when she followed with the setbacks against Kerber and Muguruza. “If anything, I was able to show resilience that, no, that’s not going to shake me, you’re not going to break me,” Williams said, “it’s going to make me stronger.” So, Williams was asked on Saturday, is she already thinking about No. 25, to surpass Court? “Oh, God, no,” Williams said. “One thing I learned about last year is to enjoy the moment. I’m definitely going to enjoy this.”

sports

First of three parts

arlo (not his real name) fell into the hands of the police at the age of 13. The charge: distribution and abuse of rugby, an inhalant popular to street children his age. It wasn’t his first jaunt into prison. A year ago, he was caught and charged with assaulting a fellow young boy with a knife in a gang rumble. He fled his home to live in the streets years

PESO exchange rates n US 47.0400

ago to escape an abusive father. The cell, with an approximate size of 3 meters by 7 meters, forced the child to squat for hours just to fit. The overwhelming heat and reek of body odor proved unbearable to the child. Food was scarce, and health risks, like pneumonia, tuberculosis and HIV, formed the added penalty to incarceration.

Children in detention

This scenario repeats itself each time indiscriminate “rescue” operations and arrests of children in

conflict with the law are staged. In Philippines: Jailed Children are the Victims of World Poverty (Children’s Rights International Network or CRIN, Preda Foundation, July 28, 2005), what is deemed as a “rescue operation” often ends in further risks for children found in conflict with the law: “These children in prison are frequently mixed with adult prisoners and sexually abused in the overpacked cells. Here, 80 to a hundred prisoners squat for 24 hours taking turns at lying down. So congested Continued on A2

@joveemarie

le a der of the House of Representatives has recently filed a package of measures aimed at wiping out the country’s 5.5 million housing backlog. Rep. Alfredo B. Benitez of Negros Occidental said he filed three bills which sought to transfer government offices to the provinces; establish a resettlement program for informal settlers; and to standardize housing terminologies. In his proposed Administrative Capital City Planning Act of 2016, Benitez wants to create a commission that will craft a plan to relocate government agencies and establish an “administrative capital city” outside of Metro Manila. “There is a need to rethink and develop a master plan that will decongest Metro Manila. Relocation of capitals has already been done by several countries,” he said in his proposal. “Malaysia, for instance, built a new administrative capital to ease

There is a need to rethink and develop a master plan that will decongest Metro Manila. Relocation of capitals has already been done by several countries.” —Benitez

decongestion in Kuala Lumpur. Brazil relocated its capital to a more central location, closer to other regions and carved a new city out of wilderness in the Brazilian Highlands,” Benitez added. Continued on A3

n japan 0.4669 n UK 60.7380 n HK 6.0636 n CHINA 7.0385 n singapore 34.8573 n australia 35.1718 n EU 52.0592 n SAUDI arabia 12.5396

Source: BSP (8 July 2016 )

BMReports BusinessMirror

A2 Monday, July 11, 2016

www.businessmirror.com.ph

CHIldren on the run

Kids in conflict with the law and lowering of criminal liability Continued from A1

are the small cells. The heat and stench is overpowering, the food is only a few cents a day and disease, malnutrition and tuberculosis are the daily hazard suffered by the children.” Since the passage of Republic Act (RA) 9344, or the Juvenile Justice and Welfare Act of 2006, conditions for children in detention have somewhat improved. RA 9344 defines a child in conflict with the law as “a child who is alleged as, accused of, or adjudged as, having committed an offense under Philippine laws.” Unicef has praised this legislative breakthrough: “The passing of the Juvenile Justice and Welfare Act of 2006 was a landmark that gave many children around the Philippines a new lease on life. Before the law was passed, thousands of children were detained in adult jails and treated no differently from hardened criminals. They were exposed to subhuman conditions, not only to health hazards but also to physical and sexual abuse. Ironically, detention was not even called for as 70 percent of the children had committed petty offenses and 80 percent were firsttime offenders”. It is, nevertheless, an ongoing concern among human-rights groups to further develop the management of children under detention to global standards. Five years

CA. . .

Continued from A16

It added that the “Mug device or Mug, Red” mark on its coffee product, Nescafé, is well-known both internationally and in the country. Thus, SMC ought to be

Last week incoming House Speaker Pantaleon D. Alvarez and Rep. Fredenil H. Castro of the Second District of Capiz filed

House Bill (HB) 002 in the newly opened 17th Congress. Dubbed “An Act Amending Republic Act 9344, As Amended by Republic Act 10630, and Reverting the Minimum Age of Criminal Responsibility from 15 Years Old to 9 Years Old,” the amendment seeks to lower criminal liability from the current 15 years old to 9 years old. Both representatives explained the “necessity” of such an amendment in their Declaration of Policy: “It is the policy of the state to ensure that the Filipino youth shall be taught to accept responsibility for their words and deeds as early as possible, and not to unduly pamper them with impunity from the criminal responsibility upon reaching the age of 9 years.” In an interview with this writer in Davao City earlier this year, Alvarez mentioned the lowering of the age of criminal liability as one of three priority legislations under the Duterte administration. “First is federalism,” Alvarez said. “Then the restoration of the death penalty. Amendment of the Pangilinan law, which is the juvenile delinquency law. These are the three laws on top of our list. Actually, we’ll return it to the original provision of the Revised Penal Code. It will be discussed extensively in Congress during the committee discussion. You see, this has been the problem of law-enforcement agencies

prevented from the registration of its mark pursuant to Section 123 (e) of the Intellectual Property Code. Nestlé argued that allowing the registration of SMC’s coffee design and label was tantamount to violating Section 169 of the Intellectual Property Code, particu-

larly on false designation of origin and false description or representation. The Swiss transnational food and beverage giant said SMC’s coffee design and label were likely to “cause confusion, or to cause mistake, or to deceive as to the affiliation,” which is prohibited under Section 169 of

after the passage and implementation of RA 9344, the US State Department’s 2011 Country Report on Human Rights Practices had this to say about conditions surrounding youth offenders in detention in the Philippines: “Although prison authorities attempted to segregate children or place them in youth detention centers, in some instances, children were not fully segregated from adult inmates. Girls were sometimes held in the same cells as women. Lack of adequate food for minors in jails and prisons was a concern. “From January to November [2011], Bureau of Jail Management and Penology [BJMP] and Philippine National Police [PNP] jails held 66,825 prisoners, 95 percent of whom were pretrial detainees. The remainder had been convicted of various crimes. Of the total number of prisoners and detainees, 6,107 were adult women and 501 were minors. During the same period, the BJMP released 104 minor inmates, usually in response to a court order following a petition by the Public Attorney’s Office (PAO) or the inmate’s private lawyer or through NGO-led appeals.” Current trends in child crime has put RA 9344 into question.

Lowering the age of criminal liability

through the years. They really complain about this. Don’t get me wrong. The objective of the law is very noble. But problems do arise from the practical side of it.” The authors of the bill were particularly concerned about children being used by syndicates in the commission of a crime, namely, drug trafficking. The same was clarified and reinforced in their Explanatory Note: “While the intent of protection of the Filipino youth may be highly laudable, its effects have had the opposite effects—the pampering of youthful offenders who commit crimes knowing they can get away with it.” HB 002 stands as an epilogue, should it pass muster in Congress, to a series of bills filed years back. As early as 2013, Party-list Reps. Irwin C. Tieng, Mariano Michael M. Velarde Jr. and Jose L. Atienza Jr. of Buhay had filed HB 922, seeking to amend the age of criminal liability to 9 years old in the Juvenile Justice and Welfare Act of 2006. In their Explanatory Note, they pointed to current trends in crimes involving minors. These crimes, they said, have reached unprecedented proportions in recent years. “Recent reports show that numerous syndicates are taking advantage of the exempting circumstance under the present law. They use minors as implements and shields to perpetrate crime.” the Intellectual Property Code. In upholding the IPOPHL decision, the CA cited the Supreme Court (SC) ruling favoring UFC Philippines in a trademark dispute with Barrio Fiesta Manufacturing Corp. for the mark “Papa” in catsup and other condiments.

Technological know-how, they also said, had opened doors for these children to be better acquainted with the world around them. “The massive influence of modern communication has brought minors immense awareness of their surroundings,” the Explanatory Note further added. “Minors these days are more mature, and their perspective in life have greatly improved as compared to minors 10 years ago. Accordingly, it is but timely to have our laws reviewed in order to adapt to the demands of the times.” In 2014 Rep. Gustavo S. Tambunting of the Second District of Parañaque City echoed the same sentiment in HB 3919: “Children in conflict with the law at present grow in numbers. Sad to say, minors are getting bolder and braver. These young people have emboldened themselves and criminal syndicates have capitalized on the age 15 as being free of criminal liability [….] The age of minors involved in crimes is getting younger. They are prey to unscrupulous and ruthless criminal syndicates. This representation believes in the restorative system of justice, thus, lowering the age of criminal responsibility.” To be continued

Joel Pablo Salud is currently the editor in chief of the Philippines Graphic newsweekly magazine The SC affirmed the decision of the Intellectual Property Office (IPO) rejecting the application of Barrio Fiesta Manufacturing Corp. for the exclusive use of the mark “Papa Boy and device” for its products. The SC explained that a scrutiny of the contending parties’ respective marks would show that the IPO’s rulings correctly found the word Papa as the dominant feature of UFC’s mark “Papa Ketsarap” and that contrary to Barrio Fiesta’s contention, “Ketsarap” cannot be the dominant feature of the mark as it was merely descriptive of the product. The SC held that UFC’s Papa was confusingly similar to Barrio Fiesta’s Papa considering that products—catsup for UFC and lechon sauce for Barrio Fiesta—are both household products. The SC said, if allowed registration, confusion of business may set in and UFC’s hard-earned goodwill may be associated to the newer product introduced by Barrio Fiesta. “Applying the foregoing decision to the case at bar, this Court finds that the director general of the IPOPHL is correct in saying that there is no confusing similarity between the marks of petitioner and respondent,” the CA said. It added t he “Nescafé ” and “San Mig” marks were the dominant marks of the rival parties, as they are printed prominently on the labels of the contending marks that easily attract and catch the eyes of an ordinary consumer. It also pointed out Nescafé’s Mug device only featured a red mug and unlike the mug of San Mig which was red-orange. The appellate court also said Nestlé’s Mug device on jar clearly shows the word Nescafé with a line connecting from the letter “N” overlining the remaining letters “ESCAFÉ.” On the other hand, the CA observed that in SMC’s mark, the terms “San Mig” was clearly distinguishable with the “double-leaf” device above the letter “i” and also has the word “Strong.” “As such, there is little possibility of confusion in the minds of the ordinary purchaser, especially considering the distinct visual difference between the marks,” the CA said. Two other CA jurors, Associate Justices Rosmari Carandang and Socorro Inting, supported the decision.

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Small-scale miners to also undergo audit–Lopez By Jonathan L. Mayuga

@jonlmayuga

mall-scale miners will also be subjected to strict regulation as part of the government’s campaign against “irresponsible” mining, according to the chief of the Department of Environment and Natural Resources (DENR).

Environment Secretary Regina Paz L. Lopez told the BusinessMirror much needs to be done to protect the environment and the people who will be affected by mining. “All mining, anything extractive. This is going to be a holistic audit,” Lopez said when asked if small-scale miners will also undergo audit. Currently, there are around 300,000 small-scale mining operators and miners in the country. Under Executive Order (EO) 79, small-scale mining should be done within a declared “Minahang Bayan,” but this is not strictly enforced. Small-scale mining is done by firms and cooperatives, although EO 79 has limited small-scale mining to cooperatives. Small-scale miners are mostly engaged in gold-mining. There also still undetermined number of artisanal and small-scale miners who are engaged in gold-panning and salvaging gold in rivers, mostly in gold-rich areas. There are only five declared Minahang Bayan in the Philippines. These are in Barangay Maputi, Banaybanay town in Davao Oriental; Barangay Waso, Lorente town in Eastern Samar; Buenavista, Quezon; and two others in the provinces of Dinagat Island and Agusan del Sur. While small-scale mining falls under the mandate and jurisdiction of the Provincial Environmental Management Board, the DENR, through its Environmental Management Bureau, issues environmental compliance certificate (ECC), which can be suspended, revoked or cancelled upon violation of terms and conditions. “Yes, small-scale mining is within the mandate of the local government, but DENR issues ECC,” she said. Lopez added that the mining audit is not aimed at undermining the industry’s contribution to the local and national economy, but to ensure environmental protection to spare people in mining-affected communities from the adverse impact of their operation. “I don’t want people to suffer, that is all. It is not right. Our farmers, our fishermen, our communities. You can’t go against them,” Lopez said. On Friday the DENR, through its three regional officials in Central Luzon, have slapped a preventive suspension order against two large-scale nickel mines in Zambales, effectively stopping all mining operations in the province—a mineral reservation area. The preventive suspension order was issued in view of the Supreme Court writ of kalikasan issued on June 21, EO 1 issued by the provincial governor of Zambales, which affects all small-scale mining, and the numerous complaints aired against mining operation by residents of the municipalities of Santa Cruz and Candelaria, Zambales, and other stakeholders. Lopez said the audit of large-scale mining companies has

Bills seek to erase 5.5-M housing backlog in PHL Continued from A1

He said overpopulation, traffic congestion and “high vulnerability” to natural disasters have made Metropolitan Manila or the National Capital Region a “pariah” among world cities. Citing data from the Philippine Statistics Authority, Benitez said Metro Manila is home to 11.9 million people, making it one of the world’s most densely populated cities. Benitez also wants the proposed commission to conduct a feasibility on relocating government agencies. The commission could be placed under the Office of the President. It will identify the suitable site for the administrative city and provide a master plan for the development site. The bill allows the proposed commission to engage local and foreign consultants and experts in developing the master plan.

In-city relocation

Also, Benitez said there are about 1.5 million informal-settler families (ISFs) in the country of which, almost 600,000 are found in Metro Manila. “More than a decade after the passage of the landmark legislation that is Republic Act 7279, or the Urban Development and Housing Act of 1992 [UDHA], the Philippines is still struggling to improve its housing indicators,” he said. “Government programs before were focused on the relocation of informal settlers to areas outside Metro Manila, where they have no access to livelihood and other basic services. ISFs are pushed to go back to informal settlements in the urban centers again because of their need to find a source of income,” he added. Benitez said this prompted him to propose the adoption of an on-site, in-city or near-city resettlement, which upholds the right to the city of the ISFs. The bill also promotes the “People’s Plan” as a tool that recognizes their need for adequate consultation and participation of the beneficiaries themselves in planning their resettlement. It calls for the implementation of on-site development after consultation with the affected ISFs, and in accordance with the formulated plan. “Should in-city resettlement not be feasible, near-city resettlement shall be considered. Off-city resettlement shall only be resorted to when directly requested by the affected ISFs themselves, and must satisfy the requirements of adequate and genuine consultation prior to relocation,” the bill read.

already started last week and it will take less than a month to weed out those who violate various environmental and mining laws. By August, she said the DENR, through the Mines and Geosciences Bureau (MGB)—the government’s primary main regulatory body—will determine which companies may be held liable for “causing people to suffer.” Asked what kind of documents

300,000 The number of small-scale miners in the Philippines

would be required of large-scale mining companies for the audit, she said: “I am less interested in the docu-

ments than on what is happening on the ground. My commitment is to the well-being of the farmers, fishermen and communities. The quality of their lives cannot be less important than the money companies make.” According to Lopez, even if largescale mining companies are ISO 14001-certified, they will still be held accountable “if they are endangering or having adverse effects on the lives

of the communities in their operations is still at stake. MGB Director Leo Jasareno earlier said having an ISO 14001 certification means a mining firm’s operation is on a par with international standards and ensures that it does not “compromise” the environment. “I don’t just want a technical audit. I want an environmental and social audit. It’s the right thing to do,” Lopez said.

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SEC seeks power to file civil cases against ‘pyramid’ scammers, market manipulators

By VG Cabuag

@villygc

he Securities and Exchange Commission (SEC) said it will seek the power to file civil cases against securities-law violators, such as scammers that use pyramiding schemes and market manipulators. The SEC said it wants the provision to become part of the Securities Regulation Code (SRC) amendments that it will propose

to Congress. SEC Chairman Teresita Herbosa said the agency will submit the proposal to Congress during the latter part of the year.

“Civil cases are a better deterrent. In the US the SEC actually files more civil case than criminal cases. In criminal cases, the standard of proof is beyond reasonable doubt,” Herbosa said. “In civil cases it’s preponderance of evidence, therefore, it could be easier to prove and, on top of that, could be punitive because the company itself will have corporate liability or the issuer or the trader himself or the person who manipulated the market would be liable civilly for big amount,” she added. The power to file civil cases will be on top of the mandate of the agency to file administrative

Civil cases are a better deterrent. In the US the SEC actually files more civil case than criminal cases.”—Herbosa

cases and to recommend the filing of criminal cases through the Department of Justice (DOJ). Herbosa said she is hoping the new amendments will be sponsored by Senators Benigno Aquino IV and Juan Edgardo Angara. The two also sponsored other law amendments that the SEC pushed in the past, such as the Corporation Code of

the Philippines. “I’m sure if they’re penalized in big amounts by way of fines, they would opt to either settle, which means you can achieve justice earlier than you go through the whole gamut of the judicial system,” she added. Herbosa said the current SRC limits the right to file civil cases to

individuals. The SEC is limited to filing administrative cases within its office or file a criminal case with the DOJ, which will conduct its own investigation before it filed its own case with the court. “But you know if you are an investor who already lost money because somebody already manipulated the market, you think you will still file civil case? You have to pay a filing fee of 5 percent,” Herbosa said. The SEC earlier said it also wants to have the power to look into bank deposits during investigations of securities fraud cases as part of amendments to the SRC.

Duterte administration to honor defense, security agreements with allies–Esperon The Balikatan allows our troops interoperability training; it is one of the flexible operations that we have.”—Esperon By Rene Acosta @reneacostaBM

he Duterte administration will honor its defense and security agreements with other states, including the Enhanced Defense Cooperation Agreement (Edca) and the Balikatan with the United States, despite its conciliatory tone over its territorial dispute with China. National Security Adviser Hermogenes Esperon Jr. said the government will not shirk from all the cooperation agreements the country signed with its regional allies, although President Duterte has already ordered the soldiers to prepare for possible negotiations with Beijing. Esperon said the country is obligated to honor its defense and security agreements, including the Edca and the bilateral military exercises Balikatan, as part of its international commitment and being a member of the regime of nations. The Edca, which allows the US to reposition its troops and assets in key select bases in the country, was signed during the previous administration to give the country a “feeling of security” amid China’s expansive claims in the West Philippine Sea. The Balikatan, the biggest exercise in the region, is an annual event involving Filipino and American troops. “The Balikatan allows our troops interoperability training; it is one of the flexible operations that we have,” Esperon said at a recent roundtable with executives, editors and reporters of the BusinessMirror. The UN Permanent Court of Arbitration is expected to hand down its positive ruling this week on the country’s maritime claims against China, which Beijing said it will not honor. With or without the ruling, the national security adviser also favors a “graduated action” in the Scarborough Shoal to keep the country’s claims over the territory and protect Filipino fishermen, who have vainly attempted to enter the traditional fishing ground for their livelihood. China has been exercising a defacto control over the shoal since

Esperon

2012, attacking fishermen from time to time if they pursue fishing in the territory. Esperon said maritime vessels or fishery boats could be put in the shoal for patrols, a view that do not differ with the position of the military under the previous administration, but was rejected by former President Aquino. The national security adviser also defended the decision of the Duterte administration to refocus the military operation to the local terrorist Abu Sayyaf Group (ASG) and its ongoing efforts to seek permanent peace with the New People’s Army and the two groups Moro Islamic Liberation Front (MILF) and Moro National Liberation Front (MNLF). “We have to push through with it,” said Esperon, adding that not only the Filipinos, but also the soldiers, have been longing for peace to finally prevail in the country. He said this is the reason the Armed Forces is making its “final push” against the ASG, with the end goal of disbanding the group and ending its terroristic activities, while supporting the peace talks with the rebels and the Moros. “The military has already evolved [in its mind-set], it is no longer the usual fight, fight, fight,” Esperon, a former Armed Forces chief of staff, said. The national security adviser said the ASG has “mutated” as it takes its cue from the ISIS. This, he said, gives the government more reason to target the dismantling of the group. Esperon, who was deployed in Mindanao at least 12 times as a commander of various units while he was with the Army, said progress and development in the south, particularly in areas where the terrorist group operates, cannot be fully implemented and attained unless the ASG is defeated.

A Syrian government troop walks past a banner bearing Islamic State group slogans in Palmyra after the site was recaptured. Maher Al Mounes/AFP/Getty Images/Bloomberg

As Islamic State loses ground, militants focus on attacks abroad T

o hear Islamic State (IS) tell it, the extremist group’s twoyear-old caliphate has become “more manifest than the sun in the middle of the sky.” However, the slick video the militants released last week, with children training for war instead of basketball in the background, belied the facts on the ground: its territory is shrinking, finances are dwindling, and the attempt at governance that distinguished it from other jihadist groups is failing, according to a report by IHS Conflict Monitor published on Sunday. The fear now is of an increase in attacks as the group refocuses on insurgency, IHS said. “They have to justify that they’ve lost territory with big wins and the way they can get big wins and make the headlines is by launching big attacks against civilians, not just in Iraq and Syria, but also further afield, including Europe,” Columb Strack, lead analyst for the IHS Con-

flict Monitor, said in an interview. Islamic State declared a caliphate straddling parts of Syria and Iraq after capturing Mosul, Iraq’s biggest northern city, in June 2014. Since then, extremists linked to the group have proliferated and murdered hundreds in Ankara, Beirut, Brussels and Paris, as well as in Iraq, Syria and elsewhere. The risk of further attacks echoes the narrative from the US and European governments, which say IS still poses a major terrorism threat despite losing ground. Under attack from US-backed forces dominated by Kurdish fighters, the caliphate shrank by 12 percent in the first six months of this year after losing 14 percent in 2015, the IHS report said. As of July 4, Islamic State controls about 68,300 square kilometers (26,370 square miles) in Iraq and Syria, roughly the size of the Republic of Ireland, it added.

The group, which boosted funding with illegal oil sales and extortion, has also suffered a decline in revenue. Monthly income fell to $56 million as of March from about $80 million in mid-2015 and has probably decreased another 35 percent since then, IHS said.

Death toll

The militants, meanwhile, killed more than 350 people since late May with coordinated blasts in the Syrian coastal cities of Tartus and Jableh, a massive truck bombing in Baghdad’s Karrada area, a hostagetaking in Bangladesh and three suicide bombs in one day in Saudi Arabia. The Turkish government blames IS for attacks at its main international airport in Istanbul that killed at least 47 people in late June. “They’re going back to what they know and they’re going back to what they can do very well,” Strack said.

“They’re emphasizing the broader, global scale of their endeavor as opposed to just the governance project that they set up in Iraq and Syria.” The caliphate has been fraying since last year. The militants lost the two major cities in the Iraqi province of Anbar: Ramadi in December and Fallujah last month. Today, Islamic State is engaged in battles with mostly Kurdish forces that advanced into the Syrian town of Manbij, a key logistics hub close to the Turkish border and 100 kilometers northwest of Raqqah, the group’s self-proclaimed capital. Strack said the militants are throwing everything they have at Manbij, contrasting with their relatively quick withdrawal from Fallujah. If Manbij and the other logistics hub, Al-Bab, fall and Raqqah is isolated, it will be very difficult for the group “but it won’t spell the end of the Islamic State as an organization,” Strack said. Bloomberg News

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AseanMonday BusinessMirror

Chinese electric-bus maker eyes Thailand

Chinese electric-bus maker has expressed interest in investing in an automotive assembly plant in Thailand to produce electric buses to serve the country’s transport system, Industry Minister Atchaka Sibunruang said. Speaking after meeting the chief executive of Shenzhen Wuzhoulong Motors Group, Atchaka said the company produces eco-friendly buses and has strong expertise in trading automotive parts. “The company wants to make Thailand the production base for its electric buses and export to other Asean countries,” she said. Shenzhen Wuzhoulong plans to make 10,000 buses in the first year. The company has a production capacity of 30,000 units a year in China and plans to make passenger electric cars to serve rising demand in the region. The group has provided 4,000 buses to serve 300 public transport routes in Shenzhen, the bustling special economic zone in Guangdong province. The incoming investment of Shenzhen Wuzhoulong comes at an ideal time, as the government is also considering a plan to support electric vehicles (EVs). Atchaka said the relevant government agencies, including the Industry Ministry, the Finance Ministry and the Board of Investment, will discuss the investment package and incentives to support investment in EVs before passing the proposal to the cabinet for approval. “Electric cars have become a trend in Thailand and will continue to

grow. The government and the Bangkok Mass Transit Authority (BMTA) also have a policy to open bids for electric buses to be used in the BMTA system. Shenzhen Wuzhoulong Motors Group is also interested in joining the bids,” she said. Currently, several Thai and foreign investors, including Shenzhen Wuzhoulong, Loxley Plc., Cherdchai Tour and Tesla Motors, have expressed an interest in investing in electric cars. Cho Thavee Dollasien Plc. (CTVDoll), an MAI-listed bus and truck assembler, has set its sights on expanding into EVs. CTV-Doll also signed a partnership deal with Germany’s Framo-Werke GmbH this month to develop electric trucks in Thailand. Atchaka said Thailand also aimed to be a production base of EVs in Asean due to its ideal location in the center of the region and its high technology that will help serve rising demand for EVs. Domestic carmakers are also seeking government support to start investing in plug-in hybrid electric vehicles in Thailand. She said EVs are one of the 10 targeted industries the government wants to promote as next-generation industries. They are cars; smart electronics; affluent, medical and wellness tourism; agriculture and biotechnology; food; robotics for industry; logistics and aviation; biofuels and biochemicals; digital; and medical services. Apart from EVs, Thailand’s overall automotive industry is also recovering. TNS

Editor: Max V. de Leon • Monday, July 11, 2016 A5

Manila third-most expensive Asean city for expats–Mercer

ANILA followed Singapore and Bangkok as the most expensive city in the Association of Southeast Asian Nations (Asean) region, according to a ranking by consulting firm Mercer Llc. Mercer’s 22nd annual Cost of Living Survey showed that Manila rose five notches from its rank of 75 last year. Bangkok zoomed 29 notches from its rank of 45 last year to this year’s ranking of 74th most expensive city in the world for expatriates. Singapore remained unchanged as the fourth-most expensive city in the world and the most expensive among eight Asean countries. The least expensive is Kuala Lumpur, Malaysia. To note, Asean member-country Lao PDR and observer-country Papua New Guinea were not included in Mercer’s ranking. Mercer’s survey finds that factors, including currency fluctuations, cost inflation for goods and services and instability of accommodation prices, contribute to the cost of expatriate packages for employees on international assignments.

The peso has steadily strengthened against the greenback since hitting P56: $1 in 2004. The peso inched further up against the US dollar on July 8 by closing at P47.08: $1. According to the National Economic and Development Authority (Neda), the country’s inflation rate last month inched up to 1.9 percent from 1.6 percent in May due to increases in food and nonfood prices. In a statement, the Neda said the rate is within the Bangko Sentral ng Pilipinas’s forecast of 1.5 percent to 2.4 percent for June and the median market expectation of 1.9 percent. The International Monetary Fund has said it expects inflation to rise to 2 percent this year as commodity prices stabilize. According to Mercer’s survey, Hong Kong emerged this year as the most expensive city for expatriates both in Asia and globally, as

a consequence of Luanda’s drop in the ranking due to the weakening of Angola’s currency. The monthly rent of a two-bedroom unfurnished apartment of international standards in an appropriate neighborhood in Hong Kong is $6,809.47 (P320,756.68), Mercer’s survey showed. It is $3,129.66 (P147,421.07) in Singapore, $4,002.50 (P188,535.76) in Tokyo and $3,434.25 (P161,768.63) in Beijing.

Nonetheless, a fast-food hamburger meal in Hong Kong is cheaper at $4.83 (P227.51) compared to Singapore ($5.48 or P258.13), Tokyo ($6 or P282.63) and Beijing ($4.88 or P 229.87). A large Big Mac meal costs only P204 ($4.33) in the Philippines, according to the web site of the restaurant carrying the brand. A competing brand called “Champ” is priced at P146.30 ($3.11) on the company’s delivery web site. Dennis D. Estopace

Table: Cost of Living Ranking (Asean)

2015

2016

CAPITAL

COUNTRY

SINGAPORE

Singapore

BANGKOK

Thailand

MANILA

Philippines

HO CHI MINH CITY

Vietnam

BANDAR SERI BEGAWAN Brunei Darussalam

JAKARTA

Indonesia

106

HANOI

Vietnam

142

118

PHNOM PENH

Cambodia

113

151

KUALA LUMPUR

Malaysia

Source: Mercer Llc.

The World

Monday, July 11, 2016 • Editor: Lyn Resurreccion

Australian PM claims reelection

BusinessMirror

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Economy, security key issues as Japan votes for upper house

Australia’s Prime Minister Malcolm Turnbull speaks at the government offices in Sydney on Sunday. Turnbull’s coalition government was reelected. AP/Rick Rycroft

YDNEY—Australia’s prime minister said on Sunday that his conservative coalition government was reelected for a second three-year term, after a chaotic national election that left the country in a state of political paralysis for more than a week while officials scrambled to sort out who had won the tight race. Vote counting was still under way from the July 2 ballot, but Prime Minister Malcolm Turnbull said his conservative Liberal Party-led coalition had secured a victory, and that opposition leader Bill Shorten had called him earlier to congratulate him on being reelected. “We have resolved this election and done so peacefully,” Turnbull told reporters. The election was not, however, entirely resolved. Parties are required to hold at least 76 seats in the 150-seat House of Representatives to form a majority government, and neither party has yet to officially reach that number. There are two possibilities: Either the coalition will form a majority government by a slim margin, or the country will have a hung parliament. If that happens, Turnbull’s coalition will forge an alliance with independent and minor party lawmakers to form a minority government. Three independent lawmakers have already pledged their support to the coalition if such a situation arises. Asked whether he thought his party would win a majority, Turnbull replied simply: “We’ve won the election.” With about a quarter of the ballots still left to be counted, the Australian Electoral Commission said the coalition was leading in 76 seats, the center-left Labor Party in 69 seats and minor parties and independents in five. It could take days or weeks to resolve the final tally. Despite the victory, Turnbull faces a tough road ahead with a divided party, a fractured Senate and a weary electorate. The government went into the election with a comfortable majority of 90 seats and few had predicted it would suffer such steep losses. The result has raised the prospect that Turnbull could face a leadership challenge from colleagues unhappy with the party’s weak showing. If Turnbull ends up being tossed out, Australia would end up with its fifth prime minister in just over three years,

continuing a period of remarkable volatility in the nation’s politics. Even if Turnbull manages to hang onto his job, he has a slew of problems to contend with. The moderate leader needs to face the more conservative lawmakers in his party who are angry about his performance and upset that he ousted his predecessor Tony Abbott in an internal leadership ballot less than a year ago. He will also need to deal with a fragmented Senate that could make it tough for him to pass laws. Though the final makeup of Parliament’s upper house is unlikely to be known for weeks, no party will win a majority of seats. That means even if Turnbull gets contentious legislation passed by the House, he would still have to try and strike deals with the opposition or a disparate group of Senate independents and minor parties to get it signed into law. The turbulence has already caused other problems. Uncertainty surrounding the election prompted rating agency Standard and Poor’s to downgrade Australia’s coveted AAA credit rating last week from “stable” to “negative.” The agency said Australia needs “more forceful fiscal policy decisions” to reign in debt and believes such tough measures could be postponed by the new Parliament. The chaos follows one of the closest elections in Australian history, which failed to deliver an immediate victor. In several seats, just a few hundred votes were separating the coalition from Labor. Despite the close race, it became clear in recent days that Labor would not be able to win enough seats to form a government, prompting the opposition leader to formally concede the race earlier on Sunday. “I hope for our nation’s sake the coalition does a good job,” Shorten told reporters in Melbourne. “I hope they run a good government.” The opposition leader said his party would work with the coalition to find common ground, saying he understood Australia’s need for a functioning parliament. Shorten also said it was time Australia considered ditching its pencil-and-paper voting system for a speedier electronic version. “We’re a grown-up democracy,” Shorten said. “It shouldn’t be taking eight days to find out who has won.” AP

A voter casts her ballot in Japan’s upper house parliamentary election as representatives of a local election administration commission observe at a polling station in Tokyo on Sunday. AP/Eugene Hoshiko

OKYO—Japanese are voting in a nationwide election for the upper house that may cement the prime minister’s grip on power, as he forges ahead with policies to encourage exports and easy lending to keep a shaky economic growth going. Half the seats in parliament’s less powerful upper house are up for grabs in Sunday’s balloting. There is no likelihood of a change of power. Prime Minister Shinzo Abe’s ruling Liberal Democratic Party controls the lower house, which chooses the prime minister. The only contention in the balloting is how much support Abe can win. Abe had repeatedly stressed during his campaign that his “Abenom-

ics” program to bolster growth is still unfinished, and patience is needed for results. He has not touched on the other part of his agenda, which is to have Japan assert itself more as a military power. “That is so dangerous, and it may lead Japan into war with other nations and make it a nation without freedoms at home,” said Yuriko Keino, a musician and composer living in Tokyo, who was planning to vote

later in the day. “We must all raise our voices and come together to protect peace and freedom.” The Liberal Democrats have ruled Japan since World War II almost incessantly with their probusiness policies, and until recently enjoyed solid support from rural areas. The few years the opposition held power coincided with the 2011 quake, tsunami and nuclear triple-disasters that devastated northeastern Japan. The opposition fell out of favor as inept in reconstruction efforts. Some Japanese agree with Abe’s views on security because of growing fears about terrorism, as well as concerns about the recent missile launches by North Korea and China’s military assertiveness. Sunday’s was the first major election after the voting age was lowered from 20 to 18, potentially adding 2.4 million voters. Although manga animation and other events were used to woo young voters, results from early and absentee voting show turnout

may be low. Many young people are disillusioned with mainstream politics. Some analysts see 78 as a magic number—the number of seats that would give the ruling coalition a two-thirds majority in the upper house. That kind of support could be enough for Abe to push forward with rewriting Japan’s postwar pacifist constitution. But a referendum would still be needed, and public support for pacifism remains high. Masses of people have come out against nuclear power since the March 2011 catastrophe. But that has not weakened Abe in recent elections, although he has made clear he is eager to restart reactors that were idled after the disaster, the worst since Chernobyl, and make nuclear power a Japan export. “I voted hoping the economy of the country gets better. I think the economy is still hitting bottom, and I hope it gets better even just a bit so that my life gets easier,” said Jiro Yonehara, a “salary man,” as company employees are called, after emerging from a voting booth. AP

U.K. Tory contest heats up China aim for the sky with new radio telescope over motherhood row B A

ndrea Leadsom, who’s running second in the all-female race to be the United Kingdom’s next prime minister, defended her campaign after attracting criticism for comments suggesting that being a mother makes her a better leader. Rival Theresa May doesn’t have any children. Mother-of-three Leadsom, who worked in fund management before entering politics, accused The Times of “gutter journalism” and said in comments posted on Twitter that the way the newspaper presented the interview was “the exact opposite of what I said.” The Times reported Leadsom as saying that being a mother made her a better choice than May because she has a “very real stake” in the future of Britain. The controversy is the latest blow to the energy minister’s campaign, which has fallen further behind odds-on favorite May after questions about whether her resumé exaggerated financial industry experience and doubts about her leadership. Home Secretary May is supported by the bulk of Conservative Party lawmakers. Prime Minister David Cameron resigned in the wake of the June 23 vote to leave the European Union (EU), something he campaigned against, and says he will leave decisions about how and when to implement the split to his successor. The Times and the Telegraph, two of the most

influential right-leaning newspapers, both published opinion articles on Saturday, saying Leadsom was not qualified to be prime minister. Bookmaker Ladbrokes said May was favorite to become the next Conservative leader and offered 10/1 that Leadsom would withdraw before the end of July. “It was one way traffic for Leadsom but her comments have stemmed the tide of bets for the outsider,” Ladbrokes spokesman Alex Donohue said. Britain’s impending exit from the EU has sent the pound down to a 31-year low, hurt consumer confidence, and led managers to suspend trading in United Kingdom real-estate funds amid uncertainty about how the country will navigate its exit. Leadsom, who supported the pro-Brexit campaign, has pledged to immediately invoke Article 50 if elected, starting the two-year withdrawal process. Legal experts have said that would be illegal without the approval of Parliament and threatened lawsuits. The first was filed this week by lawyers representing Deir Dos Santos, a UK hairdresser. May, 59, has sought to distance herself from Tory infighting over Brexit. On Saturday she announced a clean campaign pledge, promising to ensure that the contest was “in good taste” and stays “within the acceptable limits of political debate.” Bloomberg News

EIJING—What’s the size of 30 football fields, hunts for aliens and lurks in the forests of southwest China? The world’s largest single-aperture radio telescope, of course. China completed construction on the telescope—the $180-million Five-hundred-meter Aperture Spherical Telescope (FAST)—this week by hoisting the last of its 4,450 triangular panels into place. Pictures posted online showed the vast, gray, disk-shaped structure nestled among the lush trees and karst cliffs of Guizhou, one of China’s poorest provinces. It had been under construction since 2011 and is expected to begin operations in September. “The project has the potential to search for more strange objects to better understand the origin of the universe and boost the global hunt for extraterrestrial life,” said Zheng Xiaonian, deputy head of the National Astronomical Observation under the Chinese Academy of Sciences, which built the telescope, according to the official New China News Agency. China is on a bit of a space kick. In April President Xi Jinping called for China to become an “aerospace

In this photo released by China’s Xinhua News Agency, the sun sets above the Fivehundred-meter Aperture Spherical Telescope in Pingtang County in southwestern China’s Guizhou Province on June 27. Liu Xu/Xinhua via AP power.” Beijing launched 19 space missions in 2015 and hopes to up that tally this year. It spends $2 billion to $3 billion annually on its space program, with hopes to eventually put an astronaut on the moon. (National Aeronautics and Space Administration will spend $19 billion this year.) FAST, with its 1,640-foot diameter, is not actually the world’s biggest radio telescope; that honor goes to the Ratan telescope in Russia’s Caucasus

Mountains, a “multi-element-reflector radio telescope” whose surface elements are not connected by one joining structure. Ratan looks like a ring; FAST looks like a dish. FAST’s surface can shift to form a parabolic mirror, affording scientists greater flexibility and control. The world’s second-largest single-aperture radio telescope is Puerto Rico’s Arecibo Observatory, completed in 1963, which is just under 1,000

feet in diameter. FAST will be able to detect radio waves up to 1,000 lightyears away—three times farther than Arecibo—and will generate 5 terabytes of data daily. “With [FAST], we can explore pulsar, black holes swallowing small objects, the evolution of stars, and the origins of the universe, and connect it with other radio telescopes within the country to create a virtual super telescope,” Science Communication China, an official institute under the China Association for Science and Technology, said in a February column that was widely republished online in recent days. FAST is in Pingtang, a remote county in one of Guizhou’s high mountain valleys. While the structure was under construction, authorities relocated more than 9,000 villagers within a three-mile radius to prevent magnetic disruptions. Even a cell phone could potentially interfere with incoming signals. Each was given $1,800 in compensation. “Curiosity about outer space is related to a country’s economic development,” said Zhang Huawei, an astrophysics professor at Peking University. TNS

news@businessmirror.com.ph

The World BusinessMirror

UK needs to ‘tool up’ with hires for trade talks, Cameron says

How that takes place, he said, is “up to the parties involved.”

Dimon’s view

A man has breakfast inside a coffee shop, as a homeless person sleeps on the sidewalk in central Glasgow, Scotland. In one of the defining splits of June 23’s European Union referendum, all 32 council areas in Scotland, as well as Northern Ireland, voted for Britain to stay in the bloc. Even towns shattered by the demise of shipyards, coal mines and steelworks made the calculus that quitting the EU wouldn’t turn things around for them. AP/Emilio Morenatti

nited Kingdom Prime Minister David Cameron said the government needs to tap law firms, businesses and foreign talent for negotiators to broker the nation’s trade deals as it prepares to officially trigger its withdrawal from the European Union (EU). Britain’s four-decade membership of the EU has left it with a dearth of its own experts, because the bloc coordinates trade negotiations centrally. That’s left ministers scrabbling to build teams that can broker new trading arrangements for a post-Brexit Britain, both with EU nations and countries outside the bloc, from the US to China. “We’re obviously going to have to tool up in terms of preparing for trade negotiations,” Cameron told reporters at a North Atlantic Treaty Organization (Nato) meeting in

Warsaw on Saturday. “We’ll seek the talent wherever we can get it. But don’t underestimate the huge amount of talent that there is in British legal firms, in British business.” The UK’s vote to leave the EU in a referendum last month sent the pound plummeting, fomented warnings of recession and left the country in political paralysis. Cameron announced his resignation and the opposition Labour Party turned in on itself amid a failed putsch on party leader Jeremy Corbyn.

Business Secretary Sajid Javid said on Friday the government is seeking to recruit 300 specialist staff, including trade negotiators, by the end of the year. “I’m sure there will be opportunities to listen to experts from other countries, those that have been doing these things,” Cameron said. He said he hadn’t discussed with Barack Obama remarks the US president made prior to the EU referendum that Britain would be at the “ back of the queue” in terms of negotiating a trade deal with the US post-Brexit. “Everybody knows now that Britain is now in a process of working out the best end state for leaving the European Union,” Cameron said. “But we don’t have to wait until that happens until we start scoping out what are the trading and investing and other opportunities, and that’s something we need to start with right away.”

Obama: Brexit vote ‘to stick’

Obama said he expects the UK will abide by the wishes of British voters and carry out plans to leave the European Union, and urged both sides to conduct the departure with minimal disruption. “We have to assume that a refer-

endum having been passed with a lot of attention” and relatively high participation rate “is going to stick,” Obama said on Saturday in Warsaw, after meetings with leaders of the Nato. “Our primary interest is to make sure that the negotiations and the process is as orderly as possible.” The president’s comments are a further blow to pro-EU campaigners who hope the UK might not follow through and leave the bloc. While a majority voted in favor of a Brexit, the referendum is not legally binding and more than 4 million people signed a petition calling for it to be annulled. The government rejected that appeal. During the two-day Nato summit, Obama had his first meetings with European leaders since the June 23 British referendum. He met on Friday with EU President Donald Tusk and European Commission President Jean-Claude Juncker to discuss the Brexit vote. Earlier on Saturday, he met with leaders of the UK, Germany, France and Italy. Obama told reporters that the US has to expect the British government will eventually trigger official proceedings to leave the EU after UK voters expressed their desire to quit the 28-nation bloc.

Negotiations for the terms of Britain’s exit won’t begin in earnest until UK leaders invoke Article 50 of the Lisbon Treaty, setting off up to two years of discussions, Tusk said on Friday. After his meeting with Obama, Tusk said he was confident that other countries would not emulate the UK and leave the EU. Some government officials, analysts and executives have suggested that the UK could reverse its decision. Jamie Dimon, CEO of JPMorgan Chase and Co., said this week that Brexit is unchartered territory and there would be nothing wrong in changing course. “There are always solutions to the problems, as long as you have the right people in the room,” Dimon said in an interview with Italian newspaper Il Sole-24 Ore. Henri de Castries, Axa SA CEO, said last week that the odds the UK will reverse its vote to leave the EU are “low, but not zero.” Obama emphasized that the UK and EU are “close friends, allies and commercial partners” and would remain so post-Brexit. He cited the need for an “orderly” process that would ease the UK out of the EU while minimizing negative side effects for the global economy. “It’s important that neither side harden positions that do damage to their respective economies or the world economy at a time when our world economy is still pretty wobbly in places,” Obama told reporters.

Pound plummets

The president has used the platform of the summit to extol the virtues of the European project, which has come under strain in recent years. In the weeks since the Brexit vote, politicians in several European countries have called for their citizens to leave the EU, as well. Still, as British stocks and the pound have taken a hammering, polls in Germany, the Netherlands and Scandinavian countries show a surge in support for EU membership. Obama argued on Saturday there are “enormous benefits” to be gained from globalization, yet he acknowledged that it brings “danger of increased inequality, workers having less leverage and capital having more leverage.” He cited the need to address issues, including health care, the protection of pensions and ensuring that communities are not abandoned when a factory closes. “If we do not do that effectively, then there’s going to be a backlash,” Obama said. Bloomberg News

Monday, July 11, 2016 t A7

China’s bid for tech dominance making Israeli company rich

as China bitten off more than it can chew when it comes to making chips? That’s where Orbotech Ltd. comes in: To make sure the billions are well spent. Orbotech makes inspection and repair tools that help factories avoid errors as they pump out increasingly complex chips for smartphones and tablets. Its market capitalization surpassed $1 billion in March, a level not seen since the dotcom era: it has rallied 18 percent this year, compared with a 5.7-percent gain in the Philadelphia Stock Exchange Semiconductor Index and a 1-percent drop in the Nasdaq Composite Index. Orbotech’s business is booming in China, where the government is trying to build a homegrown industry that can make chips and screens—components of the phones and tablets it already exports to the world. That would allow it to replace costly imports and lessen its reliance on US companies. China has said it plans to invest as much as 1 trillion yuan ($149 billion) over 10 years to develop chips. Israel, whose own semiconductor industry began to flourish in the 1990s, is using its tech know-how to cultivate closer trade ties with the world’s second-largest economy, which accounted for $3.2 billion of its exports last year.

Huge windfall

“This drive to build up China’s tech-manufacturing base is going to be a huge windfall to companies like Applied Materials and Orbotech,” said Tim Call, who manages $350 million, including Orbotech shares, as chief investment officer at Capital Management Corp. in Glen Allen, Virginia. “It doesn’t matter if the tech plants already exist, they want them to exist in China.” Orbotech, whose revenue jumped 29 percent to $809 million last year, makes capital equipment that allows manufacturers of chips, printed circuit boards, and flat panel displays to avoid costly defects during production. Most of its China business is tied to flat-panel displays for smartphones, tablets and televisions. It’s also getting orders from factories using OLED (organic light-emitting diode) technology, which is poised to displace the LCD technology used in most TV’s because of better picture quality.

UK deal

CEO Asher Levy expects much of the revenue from flat-panel bookings to show up in the second half of 2016, he told investors in a May 4 conference call. Rami Rozen, director of investor relations at Yavne, Israelbased Orbotech, declined to comment, citing a regulatory quiet period. Orbotech reports second-quarter earnings on August 3. The shares rose 4 percent to $26.19 in New York on July 8. Applied Materials Inc., which makes machinery to produce semiconductors, has rallied 34 percent this year, buoyed by chipmakers upgrading production technology. While’s China’s investment is driving demand for Orbotech’s products, analysts are most bullish about its 2014 acquisition of UK-based SPTS Technologies, which specializes in advanced packaging for semiconductors. Bloomberg News

Tough to keep the world from warming when carbon is cheap

arbon markets, the free-enterprise solution to saving the world from global warming, are now in danger themselves. The idea was simple enough: Set a cap on carbon emissions, issue enough permits to allow power plants, refineries and the like to stay within those limits and then shrink the cap over time to achieve reductions. The companies whose emissions fall fastest can sell their permits for a profit to slower responders—call it a reward for good behavior. The reality, though, is more complex. Undercut by a lack of political will on the size of caps and overtaken by costly new environmental mandates, carbon markets in the US, Europe and Asia are collapsing, with prices so low they’ve become virtually valueless. The credits auctioned in the US Northeast in June, for instance, sold for just $4.53 a short ton, a 40-percent drop from December. “Climate policy has been muddled and messy,” said Michael Grubb, a

professor at University College London’s Institute for Sustainable Resources who has advised the UK energy regulator. “Governments have set inadequate targets due to lobbying pressures and because they didn’t think carefully enough about overlapping efforts. That has destroyed investor confidence that carbon prices will rise.” The idea of a carbon market originated 20 years ago with Richard Sandor, an economist who also pioneered interest-rate futures and derivatives at the Chicago Board of Trade. Today there are 38 countries, cities, states and provinces using pricing systems in an attempt to put a lid on greenhouse gases, according to the World Bank. The problem is that the permits are selling at a slower and slower rate. The surplus of allowances is becoming so large in systems run by Europe, California and Quebec—which together account for more than 90 percent of global trading—that by 2022

it could cover the emissions spewing from every car on Earth for a full year, according to estimates by the London environmental group Sandbag Climate Campaign CIC and Bloomberg New Energy Finance. In California’s market, all 23 million allowances sold in an auction in 2014. In May 7.3 million permits found buyers, only 11 percent of what was put up for sale.

‘Extreme paranoia’

The markets are crumbling just as the UK’s vote to leave the European Union (EU) throws into question the future of the world’s largest market by threatening to shrink demand. Nor does the collapse bode well for China, as the world’s top greenhousegas emitter prepares to start its own next year. Alex Rau, a principal at the carbon-trading advisory group Climate Wedge Ltd., chalks up the downfall largely to “an extreme paranoia” that the price of carbon will rise too high.

So instead of strengthening caps unpopular among some oil companies, polluting factories and consumers who ultimately shoulder costs, politicians around the world have stitched together a patchwork of overlapping measures that are less vulnerable to lobbyists. Take the US, where states including California run carbon markets but have also imposed other regulations that require gasoline suppliers to cut the carbon intensity of their fuel and utilities to buy increasing volumes of solar and wind power. “When you put in place all these other mandates, there is little work left for carbon markets,” said Meredith Fowlie, an economist and research associate at the University of California at Berkeley department of agriculture and resource economics.

‘Insanely expensive’

Policies are undercutting the markets in some places. “Some of the renewable-energy

subsidies are stupidly, insanely expensive per ton of carbon dioxide saved,” said Louis Redshaw, who has his own emissions-trading company, Redshaw Advisors Ltd. in London, and was previously head of carbon at Barclays Plc. “Politicians are not only failing to deliver a comprehensive carbon price for the economy, they are busy undermining them where they exist.” In California the state Air Resources Board still has the authority to pull excess permits from circulation to avoid a glut, said Dave Clegern, a spokesman for the agency. “One auction tells us very little,” he said. “We’re in the long game here.” Anna-Kaisa Itkonen, a spokeswoman for the European Commission in Brussels, noted that its emissions targets under a climate agreement hammered out by leaders in Paris last year were among the most ambitious in the world. EU carbon allowances fell 0.7 percent to settle at €4.55 ($5.03) a metric ton on ICE Futures

Europe in London on Friday, the lowest since June 30. They’ve dropped 45 percent in the year to date. Germany, meanwhile, acknowledged that the system run by the EU is in need of an overhaul, especially in light of the Paris climate pact. “We will need to look at our ambition,” Michael Schroeren, a spokesman for Germany’s environment ministry, said in a statement. “After more than 10 years of emissions trading in Europe, we can look back on the lessons learned.” China risks falling into the same trap as others. While regulators looking to establish a national market there appear to be trying to avoid an oversupply, prices are already plummeting in pilots they’re running, said Sophie Lu, an analyst in Beijing at Bloomberg New Energy Finance. Just as carbon market history has repeated itself around the world, Lu said, China “may not be willing to pay the political and economic costs.” Bloomberg News

The W

Business

A8 news@businessmirror.com.ph • Monday, July 11, 2016

US police on edge amid threats

How, why Dallas police used robot b

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arrive together. Between City Hall and Parkland, a drive that takes about 15 minutes, Brown made his decision. When they arrived at the hospital, the chief told Rawlings of the plan to use the remotecontrolled robot armed with the brick of C4. “I was very supportive of it,” the mayor said. “I didn’t want to hear that one more of our police officers was going to die. The chief felt it was the safest way. We’d talked to the guy. We gave him choices. We said, ‘You can come out and not be hurt, or you can stay there and be hurt.’” Just before 1:30 a.m. on Friday, a handful of reporters standing a block away from El Centro College, at Commerce and Austin streets, were told by officers to “move, move, move.” Seconds later came the explosion—a loud boom, followed by what sounded like shattering glass. At the time, reporters believed it was a flash-bang, or stun grenade, intended to roust Johnson from his perch in the garage. Then, there was silence. Squad cars continued to line the streets near the community college. Some officers, armed with rifles and shields, walked west down Commerce before heading north on Market Street, toward the side entrance to El Centro. They used flashlights to illuminate the entrance. Around 3 a.m., word began circulating that the suspect had died of a self-inflicted gun wound. Rawlings dispelled those reports three hours later, when he went on network morning shows and said police “took out” Johnson. At a news conference at 7:30 a.m. on Friday, Brown said “we saw no other option but to use our bomb robot and place a device on its extension for it to detonate.” Any other option, said the chief, “would have exposed our officers to grave danger.” Saturday afternoon, Dallas police said they used a Remotec robot, with a claw and arm extension, to detonate one pound of C4. On Friday questions were raised about the ethics of using a bomb to end a standoff. TNS

Monday, July 11, 2016 A9

Nato boosts support vs. Islamic extremism

ARSAW, Poland—North Atlantic Treaty Organization (Nato) allies agreed on Saturday to provide increased military support to countries in the Middle East and North Africa that are targets of Islamic extremism, including using Nato surveillance planes in the fight against the Islamic State (IS) group. Alliance leaders also agreed to launch a new naval mission in the Mediterranean, and made commitments to maintain a stable military presence in Afghanistan and to fund Afghan security forces through 2020. “We’re moving forward with the most significant reinforcement of our collective defense any time since the Cold War,” US President Barack Obama said at a news conference at the end of a crucial Nato summit in Warsaw. Secretary-General Jens Stoltenberg said Nato will start a training and capacity-building mission for Iraqi armed forces in Iraq, a country he called central in the fight against IS. Nato is also working to establish an intelligence center in Tunisia, a major recruiting ground for IS, and will shortly start providing support to Tunisian special operation forces. “Today we have taken decisions to strengthen our partners and to project stability beyond our borders,” Stolten-

berg told reporters. He said millions of people in Africa and the Middle East have been rendered “homeless and helpless” by radical organizations like IS and that the extremist groups are also to blame for organizing terrorist attacks in Europe and America. Obama, who was attending his last Nato summit, called it “a pivotal moment for our alliance.” “In nearly 70 years of Nato we have perhaps never faced such a range of challenges all at once—security, humanitarian, political,” he said. But he concluded that with the multifaceted efforts being made, “Nato is as strong, as nimble and as ready as ever.” Stoltenberg said Obama and leaders of the other 27 Nato countries also agreed in principle for alliance surveillance aircraft to provide direct support to the US-led coalition fighting IS in Syria and Iraq. Nato diplomats say they expect flights by alliance Airborne Warning and Control System planes to begin this

fall and Stoltenberg labeled the move “a clear signal of our resolve to help tackle terrorism.” He said the alliance will launch a new maritime operation in the Mediterranean called Operation Sea Guardian, whose responsibilities will include counterterrorism. Nato will also cooperate with the European Union’s efforts to shut down human -smuggling operations that have fueled Europe’s greatest migrant crisis since World War II. The alliance will also increase cooperation with Jordan, and is preparing to help the new government in Libya design policies and institutions to help it better defend itself against extremist organizations, Stoltenberg said. “We will provide greater support to our partners, so they can secure their countries and push back against violent extremism,” he said. Obama had been urging his fellow Nato leaders in Warsaw to expand their support for the war in Afghanistan against the Taliban. Meanwhile, violence in the US led him to cut his Europe trip short so he can return home Sunday. The US has pledged to provide $3.5 billion annually to fund Afghan forces, and the government in Kabul is expected to contribute as much as $500 million. Allies would provide the remaining $1 billion. The funding would maintain a total of 352,000 Afghan Army troops and police officers. “We are very close and I am certain we will reach that [funding] level,” Stoltenberg told reporters. A senior US administration official said Nato has commitments for about 90 per-

cent of the goal. Stoltenberg said it’s too soon to say exactly how many troops individual allies will agree to keep in Afghanistan under Nato’s Resolute Support training and advisory mission. But he said he believed that, based on commitments made on Saturday, force levels will remain largely stable. Specific numbers will be finalized this fall, he said. US administration officials said they believe the number of forces dedicated to the Nato mission will be a bit more than 12,000. The officials were not authorized to discuss the details publicly, so spoke on condition of anonymity. US Army Gen. Curtis Scaparrotti, the Nato supreme commander, told reporters the US has pledged about 6,700 of that total, about 200 fewer than it currently provides. He said training and advising of the Afghan air force and special operations forces won’t be affected. But he said there would be fewer US troops training Afghan conventional forces, although the US will still send teams into the regions to assist the army and police. Earlier this week, Obama announced that overall he would keep 8,400 US troops in Afghanistan, rather than cut their numbers to 5,500 as he once planned. In addition to taking part in the Nato advisory-and-assist mission, the US has special operations forces in the country that conduct counterterrorism missions. The planned force levels allow Nato allies to remain in regional hubs around Afghanistan, with Germany in the north, Italy in the west, Turkey

in the capital of Kabul and the United States in the east and south. Scaparrotti said the Afghan mission is key to global security. “We know that there are al-Qaeda and [IS] components in Afghanistan,” he said. “If we fail there we will certainly see that impact in our global counterterrorism campaign that we’re executing. It will make it harder.” The Warsaw summit, Nato’s first in two years, was considered by many to be the alliance’s most important since the Cold War. On Friday Nato leaders approved the deployment of four multinational battalions to Poland and the Baltic states to deter Russia, as well as a Romanian-Bulgarian brigade for the Black Sea region. Germany will lead a multinational battalion in Lithuania, with similar battalions to be led by the United States in Poland, Britain in Estonia and Canada in Latvia. Obama pledged an “unwavering commitment of the US to the security and defense of Europe” and said the common defense of the trans-Atlantic alliance would never change. “In good times and bad Europe can count on the United States,” he said. The Nato plans to build up its forces was strongly criticized Saturday by Mikhail Gorbachev, the former Soviet president during the Cold War. “Nato has begun preparations for escalating from the Cold War into a hot one,” Gorbachev was quoted as saying by the Interfax news agency. “All the rhetoric in Warsaw just yells of a desire almost to declare war on Russia. They only talk about defense, but actually are preparing for offensive operations.” AP

Tourism&Entertainment BusinessMirror

A10 Monday, July 11, 2016

Editor: Carla Mortel-Baricaua

Farm-tourism stakeholders

convene in Tagaytay ‘F Kahariam Farms

arm tourism attracts visitors to farm areas for educational and recreational purposes, which encourage economic activity to provide farm and community income. It is one of the country’s sunshine industries that can be developed because of the agricultural nature of the economy.” This is one of the messages of the International School of Sustainable Tourism President Dr. Mina Gabor, as she leads the organizing efforts behind the fourth Farm Tourism Conference set at the Summit Ridge Hotel in Tagaytay City from July 14 to 16. According to Dr. Gabor, the conference will focus on low-impact travel that will empower local communities socially and economically. She also noted that the event is an ideal opportunity to learn and share best practices on farm tourism from the international and local experts in the field. Supported by the Department of Tourism (DOT), the Tourism Promotions Board, the Tourism Infrastructure and Enterprise Zone Authority (Tieza) and the Department of Agriculture’s Bureau of Agricultural Research (DA-BAR), the confab expects the participation of farmers, cooperatives, farm-tourism operators, representatives from different local government units, restaurants and hotel managers,

landowners and entrepreneurs. The keynote speakers of the three-day confab are Cavite Gov. Jesus Crispin F. Remulla, Agriculture Secretary Emmanuel Piñol, Tourism Secretary Wanda Corazon T. Teo and DOT Regional Director Rebecca Labit. Entrepreneurs who blazed the trail and helped mainstream farm tourism will share their experiences, namely, Cathy Turvill of Nurture Wellness Village, Robert Yupangco of the Zoomanity Group, Nenette Aguirre-Graf of Motag Living Museum, Rico Omoyon of Milea Bee Farm, Ramon Peñalosa of Peñalosa Farms, Ginny de Villa of Gourmet Farms, Gigi Morris of MoCA Family Farm, Ria Bagatsing of Kahariam Farms and Irish Baguilat of the International Institute for Rural Reconstruction. Other resource persons are authorities on bee culture, such as Philippine Bee Board President Anna Locsin, Apimondia Commission for Asia President Prof. Cleo Cervancia and Asian Apiculture Association

Philippines makes its mark as global entertainment destination

he Philippines once again made its mark in the global entertainment scene, as over 26,000 fans from across the globe gathered together for some explosive dance music performed by renowned local and international pop icons in this year’s biggest music event, the MTV Music Evolution Manila 2016. Presented by the Department of Tourism (DOT) and the Tourism Promotions Board (TPB), the one-night-only outdoor live music event, with the theme “Can’t Stop Movin!” presented the amazing evolution of pop music and its dance influences. The concert grounds of SM Mall of Asia was basically on fire as fans danced, cheered and sang their hearts out on hit after hit of iconic and contemporary pop dance music. World-renowned local artists Mr. Pure Energy Gary V. and his son, Gab Valenciano, opened up the stage with an intense set of performance. Filipino favorite teen love team, James Reid and Nadine Lustre, followed, sending fans high above the love cloud with their kilig-filled performance. American singer-songwriter

Bebe Rhexia also pumped up the stage with her hit songs, including “Me, Myself and I” and “Broken Hearts.” Fans also went wild as APink, one of Korea’s favorite K-pop female idol groups, flawlessly performed “Remember,” “Mr. Chu,” “Luv” and “No No No.” LA-grown electronic dance trio Far East Movement got everyone singing, dancing and jumping with their hit singles, “Like a G6” and “Rocketeer.” The headliner, prolific hitmaker One Republic, wrapped up their performance of “Counting Stars,” “Apologize,” “Stop and Stare” and “Secret” with a display of fireworks. It gets even better as the Philippines was highlighted in a global telecast reaching an international audience of more than threequarters of a billion households in over 160 countries under the MTV World Stage global series. Only on its second year, MTV Music Evolution Manila 2016 proved once again that the Philippines is not only a premier global destination for arts and culture and leisure and adventure, but is also one of the world’s top destinations for world-class entertainment.

Ilog Maria Honeybee Farm organic products

Milea Bee Farm

Paradizoo in Tagaytay

Healthy pizza of Gourmet Farms

President Prof. Siriwat Wongsiri of Thailand. “Bees are an integral part of farming, but sadly, it has been noted that the number of bees in our farms is decreasing. Thus, the conference will also address this alarming situation,” Gabor said. There will be sessions with experts on honey-bee propagation, marketing and promotions, basic layout of farm-tourism destinations, creating tour packages, and in-depth discussions on the newly signed Farm Tourism Development Act of 2016. Noted Chef Chris Caraingan will do a farm-to-table cuisine demonstration to showcase organic and healthy cooking. This year’s conference coincides with the celebration of the United Nations Food and Agriculture Organization (FAO) International Year of Pulses that would help heighten the public awareness on the nutritional benefits of pulses as part of sustainable food production aimed toward food security and nutrition. The confab will visit successful farms in Cavite, namely, Nurture Wellness Village, The Flower Farm, Paradizoo Residence Inn and Gourmet Farms, to offer participants a firsthand experience on innovative activities and products they offer. There will also be a farm-tourism exhibit showcasing destinations and tour packages, as well as a Farmers’ Market, where fresh and locally grown agricultural produce will be on sale. The conference will also honor Sen. Cynthia Villar, AAMBIS-OWA Party-list Rep. Sharon Garin, former Tourism Secretary Ramon R.

Motag Living Museum 3

Jimenez and Costales Nature Farms founder Ronald Costales for championing farm tourism. It is said that the Costales Farm in Majayjay, Laguna, is one of the industry leaders of farm tourism in the country. “Aside from Costales, there are a lot of farm-tourism sites in the country and their number increases

every year. Each one is quite unique, offering different experiences to tourists who are into nature, organic farming and healthy living,” added Rebecca Villanueva-Labit, regional director of DOT Region 4A. The event is also supported by the Department of the Interior and Local Government, the Depart-

ment of Trade and Industry, the provincial government of Cavite, the city government of Tagaytay, East-West Seeds Philippines, ZestO, Pulse Association of the Philippines, the United Nations Dry Bean Council, the USA Dry Pea and Lentil, and Philippine Airlines as the official carrier. Carla Mortel

Tubong Lokal ecotourism project to help local communities

he Philippines is one of the world’s best ecotourism destinations in the world with its tremendous hiking and surfing opportunities. But, while it is essential to introduce the country’s natural beauty to foreign tourists, how could the locals accommodate their travel needs without taking a toll on the country’s ecosystem? “This is where local tour guides come in—they need to acquire the right skills and education on how they can offer the best travel experience to foreign tourists while still preserving nature,” said Kristine Villaflor, Center for Outdoor Recreation and Expedition (CORE) Program manager. It is for this reason that Primer Group

of Companies provides a Sustainable Tourism Entrepreneurship Program to local tour guides through its advocacy arm, the CORE. CORE developed its Tubong Lokal initiative, an advocacy program that aims to boost local tourism and provide supplementary means for small communities. This provides comprehensive education and necessary training for the locals and different sectors of the community, making them more adept in nature guiding, personal emergency response and quality customer service. “The program involves a series of exploration and assessment by CORE’s athletes and trusted partners who are backed with years of experience and

expertise in the field of tourism and outdoor sports,” Villaflor added. A wide-ranging tourism-development assistance program, Tubong Lokal is spearheaded by a group of outdoor enthusiasts who assist in the procurement of equipment by sourcing grants for the chosen communities. This involves cooperative financing for livelihood essentials that help promote sustainable tourism in the locality. To further support this initiative, CORE has engaged in a strategic partnership with Great Escapes Travel and Tours Inc., Primer Group’s first tourism business venture that envisions to create an avenue of proactive outdoor, travel and adventure

appreciation and patronization. “For ecotourism to work, there is a need for every Filipino to prioritize care for the environment and all it encompasses,” Villaflor said. “Everyone needs to have an entrepreneurial attitude toward developing sustainable tourism in the country.” Villaflor concluded, “There is great potential in the country’s ecotourism, only that we need to foster the right education to nurturing it. Through Tubong Lokal, we will be more than able to preserve the environment; we will also have the opportunity to provide sustainable livelihood to Filipinos living in communities that are home to the country’s most beautiful attractions.”

Tourism&Entertainment BusinessMirror

Editor: Carla Mortel-Baricaua

MiG and Tanya to ignite the stage in ‘Curtains Up!’

e is a Filipino-Australian singer who first made waves as a finalist in the CBS television series Rock Star: INXS and has made a promising career on Broadway. She is one of the rising female stars in international theater having played the role of alternate Kim in Cameron Mackintosh’s Miss Saigon in London’s West End the last two years. Together, MiG Ayesa and Tanya Manalang will bring the house down, as the country’s premier entertainment and tourism destination Resorts World Manila (RWM), in cooperation with Ultimate Shows Inc., presents Curtains Up! on July 14, 8 pm at the Newport Performing Arts Theater. Both MiG and Tanya have their share of theater credits with Mig starring in such productions as Burn The Floor, Rock of Ages, Thriller Live, Annie and We Will Rock You, among others. Tanya’s stage credits include roles in The Lion, The Witch and The Wardrobe; In The Heights, “KAOS,” The Sound of Music, and The King And I prior to landing the coveted role of Kim in Miss Saigon. Curtains Up! teams up these two theater stars for a night of favorite Broadway and West End hits of past and present accompanied by the Manila Philharmonic Orchestra under the baton of Maestro Rodel Colmenar, with concept script and direction by concert master Freddie Santos. Adding more star power to the show will be the special participation of Broadway Diva Ms. Lea Salonga. Featuring phenomenal solo performances and captivating duets, Curtains Up! combines the gritty vocal prowess of Ayesa and the sweet haunting voice of Manalang that will leave audiences breathless.

Thai Smiles announces new Bangkok-CebuBangkok direct air service

hai Smile Airways has announced it will fly direct to Cebu, Philippines, starting October. The said airline will fly to Cebu on a daily basis with three times weekly in the morning and four times weekly in the afternoon using an Airbus 320 with 162 dual class seats (12 business class and 150 economy class). Thai Smile Airways is the regional airline and wholly owned subsidiary of Thai Airways. Based in Thailand, it began operations in July 2012. The daily Bangkok-Cebu-Bangkok route is in addition to Thai Smiles’ five international routes and 12 domestic routes in Thailand. Wutcharin Thatan, Thai Smiles executive, said the airline expects a good amount of traffic from both ends considering that Bangkok is one of the popular destinations for Filipino business and leisure travellers. Likewise, Thailand is located strategically between the Philippines and Europe, the Middle East and India, where visitor traffic to the country is registering double-digit growth annually. Thatan also explained that the nonstop service between Cebu and Bangkok will be faster and more convenient for travellers from the Central and Southern Philippines than the current option, which is to fly from Cebu to Manila onward to Bangkok, saving up to one and half hours of domestic flight and a few thousand pesos for local fares. The airline executive, together with the Market Development Group of the Department of Tourism (DOT), recently visited Manila, Cebu, Bohol and Clark to gather information and to meet airport officials, in preparation for the coming flights. Erwin Balane, Head of the DOT’s Route Development Team, said that the new route will provide an additional 58,968 international air seats per year to Cebu. This will provide expanded opportunity for the country to generate foreign exchange and employment. The new route is an offshoot of the Philippines’ hosting of Routes Asia 2016 held at the SMX Convention Center last March 2016 in Manila. The event was considered as the biggest aviation event in Asia, where airlines, airports and tourism authorities met to discuss possible aviation opportunities. Thai Smiles currently has 15 units of the Airbus 320 which are intended to serve the market gap between low-cost carriers and full service airlines.

Monday, July 11, 2016 A11

Disconnected and connected: The paradox of Buscalan

By Gretchen Filart Dublin

n these times when the lure of smartphones is stronger than storms of mass destruction, it’s so easy to fall prey to perpetually checking yours, even if there is nothing in there to check. We are forever connected even if we are not.

On the wee hours of May, I found myself doing the unimaginable for a person of my generation: I disconnected from the world. Along with a handful of strangers and a backpack containing only water, clothes and a camera, I treaded the Cordillera mountains surrounding the contiguous villages of Tinglayan in Kalinga some 450 hundred kilometers away from home. It was first and foremost a pursuit of Buscalan’s Whang Od Oggay, the oldest surviving traditional tattoo artist, or mambabatok, in the Butbut tribe. The road to Buscalan, a village with zero cell-phone signal and many mountains away from civilization, as we now know, is a journey to what seems like the deep, unearthed navel of the earth. Prior to a one-hour trek from Tinglayan to the village’s seat atop a mountain, one is required to endure a 14-hour, butt-numbing drive past sharp curves and narrow roads in Nueva Vizcaya, Ifugao, Mountain Province and, finally, Kalinga. While much of the singular trail leading to the village has been cemented—an effort to ensure the safety and convenience of its continuously growing visitors since Whang Od’s art came to light—it is still not an easy one for the unfit. Steep, strait-like and mostly without shade, the path left us braised under the noon sun, drenched in sweat and often out of breath. During the arid trek, the endless expanse of verdant rice terraces and mountains surrounding us during the two-minute rest stops seemed to be the only consolation.

The ‘batok’ tradition and meeting Whang Od

Traditions are very much alive on this side of the earth. Draping walls of Charlie Pan-oy’s home, a renowned Butbut guide, are Bob Marley shirts visitors left behind, as decorative as they are an inspiration. They depict the Butbut lifestyle: one that subscribes to simple joys found on happiness and serenity. “Peace and love,” a writing on a wall reads. Along with these shirts hung bones of cattle, monkeys and goats to ward off evil spirits. Centuries ago, there have been human skulls too, when Kalinga headhunters engaged in tribal wars to assume dominion and protect their respective villages. As modern times reshape Buscalan’s history, tribal wars became a thing of the past and what remains of them are stories, photographs

Kalinga’s mountain range surrounds the village

Gorgeous view of Sleeping Beauty fronting Buscalan’s vast rice terraces

and the batok, or traditional tattoos, adorning the skin of warriors, including Fa’wad Accad, Kalinga’s only remaining warrior to date. Many of the locals found a livelihood in guiding outsiders like me into experiencing Buscalan’s native culture. For the elders in Buscalan, Whang Od included, batok signified the power of tradition, above anything else. In Kalinga culture, batok is deemed aesthetically pleasing and the women wore theirs with pride, much as the men wore them with honor, symbolic of their engagement in war. The designs, which are indigenous to the community, are tapped onto the skin using soot and a sharpened pomelo thorn attached to a bamboo stick. Dating back to thousands of years, this tradition is passed on only by lineage. Today visitors can experience it by getting a batok by Whang Od herself—mood and health permitting—her grand niece, Grace, or Elyang, another blood relative. For visitors like us, experiencing this unique tradition is among the highlights of the trip.

The trail to Buscalan involves treading narrow rice terraces.

When she’s not tattooing, Whang Od entertains visitors outside her home.

But, of course, there is meeting Whang Od herself

Featured in the prestigious Tattoo: Ritual, Identity, Obsession, Art exhibit in Royal Ontario Museum in Canada in April, Whang Od—or Apo, as she is fondly called—is considered by many the “master of traditional tattooing” and a living treasure. At 98 years old, she is an image of grace, fortitude and the unbreakable resilience that lives among mountain people. She walks her way down to Tabuk to attend gatherings and relentlessly draws and taps bodies for hours without a

Native Buscalan kids cooling down at the village’s nippy falls.

Life is simple in Buscalan.

Animal bones are used as ornaments outside homes to ward off evil spirits.

whimper, just as she did on the day we visited. Glassy-eyed and brisk, seeing her in her best element is magical and a privilege that’s worth keeping for life.

Life after ‘batok’

In the morning, we were awakened by the soft rustling of broomsticks and tiny feet making their way from one wooden home to another. Village children, while cognizant of candies and cable TV (many have it in their homes but reserve it only for the news), are more interested in child’s play or a game of basketball in the village’s makeshift court. Here, sweeping sunsets amid lush rice terraces and the contiguous mountains of Patukan, Mating-oy Dinayao, and Mantingoy—collectively called “Sleeping Beauty” by villagers—can be enjoyed with a hot cup of Buscalan’s famous robusta coffee. Tranquil and unspoiled, it is a spot that can make one feel small in a world that’s astoundingly big and awe-inspiring. On our way back to the jumpoff point in Tinglayan where our van awaits, we passed by cascades where children played and took refuge from the sweltering heat, bare naked and carefree. Such image best describes the life in Buscalan—untouched by trivial pursuits,

Unlike city kids, the children of Buscalan are more interested in running and child’s play than gadgets.

stripped of all but the bare necessities. As our tour guide explains, “The life we live in the city is the illusion; the one up in Buscalan is the reality.” Some ask me to describe my journey to the village. It’s not easy to pin a word on it without sounding overly cheesy. So I will simply say this: The journey to Buscalan is a return to a life that is pure and primordial. Small and disconnected from the materialistic life

we’ve been accustomed to, it forces one to readapt to the way the world was before modern technology and schedules took lives of their own. It’s a world that’s bigger, freer and less complicated. It’s a world where one finds her heart more open to light: the sun, smiles and tiny feet, warm conversations, the whispers of leaves and grass in the wind; a life that’s paradoxically disconnected, but more connected to the heart of the world.

Batok, or traditional tattoo, is done by tapping soot onto the skin with a bamboo stick that’s attached to a pomelo thorn.

Green Monday BusinessMirror

A12 Monday, July 11, 2016

BusinessMirror

UN warns: Record-high seafood consumption not sustainable

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

Jordan mall trailblazer in large-scale green tech

The sun sets through the roof glass above one of the new Abdali Mall’s light tubes, which redirects sunlight from the roof to the basement of Jordan’s first energy-efficient shopping complex in Amman, Jordan. Advocates for green building say sustainable building development is important in Jordan, where energy and water resources are quickly diminishing. Layla Quran/AP

A fish market in the Philippines. Kara Santos/IPS

NITED NATIONS—The United Nations’ Food and Agricultural Organisation (FAO) warned on Thursday that global fish stocks cannot keep up with record consumption, with the average person now consuming 20 kilograms of fish a year.

“Life below water, which the Sustainable Development Agenda commits us to conserve, is a major ally in our effort to meet a host of challenges, from food security to climate change,” FAO Director General José Graziano da Silva said. The FAO’s annual report on the State of World Fisheries and Aquaculture found that global supply of fish for human consumption has outpaced human-population growth in the past five decades, and is double the level of the 1960s.

The growth in consumption is largely due to aquaculture: the farming of freshwater and saltwater populations under controlled conditions, rather than harvesting of wild species. Aquaculture now provides half of all fish for human consumption. Some 57 million people were engaged in the primary fish production sectors, a third of them in aquaculture. “Developing countries were the source of $80 billion of fishery ex-

ports, providing higher net-trade revenues than meat, tobacco, rice and sugar combined,” the FAO said. Despite technical advances and innovations, many countries, especially less-developed economies, still lack infrastructure such as, electricity, water, roads, ice, cold rooms and refrigerated transport, needed to support aquaculture. Because of this, the report found that a large amount of harvested fish are spoiled and wasted. In Africa, some estimates put post harvest losses at 20 percent to 25 percent, and even up to 50 percent. Globally, postharvest fish losses are a major concern, with an estimated global total of 27 percent of fish being lost or wasted between landing and consumption. In the Mediterranean and Black Sea, it found an alarming 59 percent of assessed stocks are fished at biologically unsustainable levels. In the Northwest Atlantic, the annual catch is now less than half the level of the early 1970s, but Halibut, flounder and haddock stocks in that area are showing signs of recovery after the implementation of effective management

20kg

The volume of fish an average person consumes a year regulations. “This report shows that capture fisheries can be managed sustainably, while also pointing to the enormous and growing potential of aquaculture to boost human nutrition and support livelihoods with productive jobs,” said da Silva. The UN’s Sustainable Development Goal 14 focuses on conserving and sustainably using marine resources for sustainable development. It calls for actions to effectively regulate harvesting; end overfishing and illegal, unreported and unregulated fishing and destructive fishing practices; address fisheries subsidies; and increase economic benefits from sustainable management of fisheries. IPS

Santa Rosa City named PHL’s National Earth Hour Capital

alf of all people live in cities, which generate 70 percent of global carbon-dioxide emissions. As more Filipinos troop to these increasingly crowded hubs to find jobs—heavy traffic, polluted air, clogged waterways and rising living costs—have become a daily urban reality for millions. Three Philippine cities, all finalists for World Wide Fund for Nature’s (WWF) Earth Hour City Challenge, are showing the country what can be done to make our cities a little greener. Proclaimed as the Philippine Earth Hour National Capital, Santa Rosa City in Laguna has initiatives ranging from the erection of solar street lights to the construction of a composting facility designed to minimize landfill waste. Santa Rosa City will be recognized along with 2016 Global Earth Hour Capital Paris this coming October in Quito, Ecuador. Santa Rosa City also placed fifth in WWF’s We Love Cities Campaign, a related social-media contest that was won by Bogor, a green city in Indonesia. Placing fourth in the We Love Cities Campaign is San Carlos City in Negros Occidental, which has positioned itself as the emerging renewable-energy (RE) hub of Asia, hosting two solar parks, a bioethanol and a biomass power plant. The WWF believes that a swift but careful transition to RE is critical to curb climate change. Not to be outdone, Makati City in the National Capital Region is developing a center to provide barangay officials with the basic knowledge and de-

sign skills to be able to promote urban design projects not just to be eco-friendly, but to promote the respective cultural identity of each barangay. Makati placed 19th in the We Love Cites Campaign. First launched in 2011, WWF’s Earth Hour City Challenge is a yearlong initiative designed to mobilize action and support cities in the global transition toward a climate-friendly and one-planet future by stimulating the development and dissemination of best practices for climate mitigation and adaptation. Seven Philippine cities joined in August 2015—Cagayan de Oro, Makati, Naga, Parañaque, San Carlos, Santa Rosa and Quezon City. A total of 124 cities from around the world joined the 2015 and 2016 challenge. The We Love Cities Campaign, on the other hand, uses the power of social media to raise additional awareness for the 47 entries of the Earth Hour City Challenge, while giving the public a chance to celebrate, vote for and suggest improvements for their home cities. WWF-Philippines ran the We Love Cities Campaign from May 13 to June 26. WWF-Philippines will recognize all three finalist cities in Manila on August 12. “Each of our seven cities is a winner. We want to promote their solutions to hasten the transformation of our own urban hubs into eco-friendly, stress-free and low-carbon living spaces,” Earth Hour Philippines Director Atty. Gia Ibay said. “Traffic, smog and garbage don’t have to be our daily realities. We can make our cities more livable and sustainable. The solutions are already here,” Ibay said.

Santa Rosa City in Laguna is a component city along the south corridor of Luzon. SANTA ROSA CITY

MMAN, Jordan—In Jordan’s newest retail and leisure hub, the typical high-end boutiques, cinemas and gourmet coffee shops are tucked into an intricate ecosystem of natural heating and cooling, water recycling and hundreds of solar panels soaking up the sun’s rays. The three-story Abdali Mall is the first large-scale commercial complex in Jordan to be built to strict “green” standards. It is seen as a trailblazer in conserving what resource-poor Jordan lacks most—water and energy. It’s also part of a growing movement to build with local materials. Going green is vital for Jordan, which spends up to onefifth of its budget on importing energy and is one of the driest countries in the world. “This topic is not a luxury for us,” said Ruba Al-Zubi, who heads Edama, Arabic for sustainability, a group that promotes environmental practices in Jordan’s private sector. “For us, this is real development. If we want sustainable development, it has to be built on the standards of a green economy.” The 227,000-square-meter Abdali Mall is a centerpiece of a new business area in the center of the capital, Amman. The mall currently houses 25 stores, including Zara and Converse. By the time of the grand opening in October, the complex will also feature nine cinema screens, a food court, a dining plaza and a supermarket, mall management says. The roof of the mall is a transparent tent measuring 11,000 square meters, which allows for less electricity use throughout the year and natural ventilation. Shoppers can enjoy coffee and sweets under palm trees while natural sunlight and a cool breeze welcomes them in every corner of the building. The sound of a waterfall cascading from the first to the ground floor echoes throughout the stores and helps naturally cool the air in the mall. “When I’m here, when I look up and walk around, I just feel I’m in an open space,” said Ruba Hijazin, while shopping with her family earlier this week. “I’m not shopping in a small box like other malls.” The complex also features 12 tunnels for natural heating and cooling, with air circulating from the atmosphere underneath the building foundations and back into public spaces in the mall. An irrigation system waters small bushes and palm trees, helping to conserve water. Hundreds of solar panels circle the perimeter of the roof tent, generating electricity for the building year round. Breakage from 50,000 square meters of tile used in the construction was recycled to insulate the roof and serve as plant mulch. Five additional floors below

ground house a parking garage that can accommodate up to 2,400 cars. Chief architect Reem Bdour said she used local materials whenever possible. “A lot of big projects in the city use foreign contractors and use a lot of materials not found locally,” she said. “Jordan is a place with very little resources, but we wanted to use material from our environment.” Stone, aluminium and steel come from local companies and Jordanians make up 90 percent of the mall’s labor force, including construction, management says. The project received an $80-million long-term loan from the European Bank for Reconstruction and Development (ERBD), which said the mall sets a precedent for environmentally friendly large-scale development. “We see this as the beginning of showing that even commercial sites that have all these other requirements, accessibility, entertainment, hospitality, that they can be environmentally sustainable,” said Heike Harmgart, the bank’s director in Jordan. The mall is built to green standards set by the international Leadership in Energy and Environmental Design (LEED). Mall officials said they plan to apply for the LEED certificate after construction is complete. There are four other LEEDcertified buildings in Jordan— the Dutch Embassy, the World Health Organization Regional Office Building, the Arab Technical Group headquarters and the Middle East Insurance Company. Jordan must focus more on green building at the grassroots level, Al-Zubi of Edama said. “What we want is to change the whole value chain,” Al-Zubi said. “You actually want green material companies to open up in Jordan to introduce a new sector that will create jobs for Jordanians.” Investment in environmental conservation could generate up to 50,000 new jobs, according to Jordan’sEnvironment Ministry. Last September, the World Bank approved a $250-million loan to Jordan to reform its energy and water sectors, but the fallout from the civil war in neighboring Syria, including a growing refugee crisis, has put additional strain on Jordan’s resources. Companies in Jordan have become more attuned to saving energy costs, in part because of rising energy prices and cutbacks in government subsidies, said Abdullah Bdeir of the Jordan Green Building Council, a group that promotes green practices. A shift in attitude is needed, especially among owners of small and medium-sized businesses who need to see a return on their green investments. “It doesn’t just start with the technology, but with the conviction,” he said. AP

Science Monday

Monday, July 11, 2016 A13

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

Genetic test being developed to predict risk of Alzheimer’s

PSHS student tops in intl science fair

The Philippine delegation, composed of Marla Abao, Mikhail Torio and Justine Opulencia, together with their foreign teammates, topped the Science Challenge, a science-themed Amazing Race in the recent International Student Science Fair 2016 in Singrapore. Abao, a student from the Philippine Science High School Main Campus, received the Best Oral Presentation award for her paper, titled “An Android Application for Efficient Disaster Kit Procurement for Low-Level Floods.”

A combination of two brain diagrams, with the left showing a normal brain and the right with Alzheimer’s disease. Wikimedia Commons

hen the researchers applied a genetic test that looked for only 18 variants known to be associated with dementia risk, they failed to find patterns that separated people on the basis of cognitive function, or hippocampal volume, or betaamyloid levels in the brain. New research into the genetic underpinnings of Alzheimer’s disease offers fresh evidence that the devastating brain disorder may gain a foothold years before dementia sets in, and takes a key step toward earlier detection of the disease. In a study that scoured the genes of healthy young people for the presence of variants linked to Alzheimer’s disease, researchers have found that those who carried many of the telltale gene variations had a smaller hippocampus—a brain structure that is crucial to memory-formation—than did their peers with few of the genetic variations. While statistically significant, the association was somewhat weak. But it was clearly detectable in cognitively healthy study participants who were still very young—between 18 and 36 years old. When a large population of older study participants without dementia underwent the same broad genetic query, the test was able to distinguish those with poorer memory and cogni-

tive function from those whose mental faculties were still strong. On average, researchers found that the more Alzheimer’s disease genetic variants an older study participant carried, the smaller his hippocampus and the greater was the presence in his brain of beta-amyloid protein—the sticky stuff that forms brain plaques in those with Alzheimer’s disease. The new study was published on Wednesday in the journal Neurology. The genetic test, which queried the genome at several thousand sites that have been linked to Alzheimer’s disease, also detected with some accuracy participants who, over a three-year follow-up period, would go on to be diagnosed with Alzheimer’s. The genetic test used in the latest study is unlikely at any point soon to be a useful predictor of who will develop Alzheimer’s and who won’t, said experts. For now, its principal use may be to identify people who are at unusually high

risk of developing symptoms of dementia as they age. Those people might then be enrolled in clinical trials of therapies that could delay or disrupt the onset of Alzheimer’s disease’s most telling symptom— progressive loss of memory and cognitive function. Heredity is believed to play a powerful role in Alzheimer’s risk. Certain variations in one gene, called APOE, appear to account for some of Alzheimer’s inherited risk—about 6 percent. Studies that look for common patterns of genetic variation in large populations of people with the same disease—so-called genome-wide association studies—have found many other gene variants linked to Alzheimer’s, but no one of those seems very powerful. The latest study does little to zero in on gene variants that play a clear role in conferring Alzheimer’s disease risk. In fact, its findings suggest instead that in determining an individual’s risk of developing Alzheimer’s disease, the interaction among genes, and between genes and environment, is likely very complex. When the researchers applied a genetic test that looked for only 18 variants known to be associated with dementia risk, they failed to find patterns that separated people on the basis of cognitive function, or hippocampal volume, or beta-amyloid levels in the brain. Those patterns only emerged when they queried their population’s genomes at thousands of sites and assigned each participant a “polygenic risk score” based on his or her results. “This result suggests that there is still a lot of undetected genetic variation underlying the risk of Alzheim-

The number of variants associated with dementia risk to which the researchers looked for when they applied a genetic test

er’s disease,” said Boston University neurologist Sudra Seshadri, who was not involved with the study. That’s consistent with other research, she added, and underscores that developing a truly predictive test of an individual’s Alzheimer’s disease risk will be a daunting task. Still, the latest effort at early detection is “an important first attempt,” said Johns Hopkins University’s Dr. Dimitrios Avramopoulos, who studies genes and mental illness and was not involved in the study. As genome-wide association studies become larger, and researchers’ gain confidence in identifying the true risk variants for Alzheimer’s Disease, “prediction will improve,” Avramopoulos added. Until such tests are in hand, he said, the new findings support the notion that the processes leading to Alzheimer’s disease start early and progress for a long time before symptoms of dementia are clearly evident. That long run-up “underlines the importance of accurate predictions, which can allow early lifestyle modifications or treatments,” Avramopoulos said. “Genetic-risk scores will certainly have a place in these predictions.” Los Angeles Times/TNS

epartment of Science and Technology-Philippine Science High School (DOST-PSHS, also popularly called Pisay) Main Campus student Marla Abao recently bagged the Best Oral Presentation award at the International Student Science Fair (ISSF) held at the National University of Singapore-High School of Math and Science in Singapore. Abao won the prize for her research, titled “An Android Application for Efficient Disaster Kit Procurement for LowLevel Floods.” Abao, and schoolmates Mikhail Tori and Justine Opulencia, individually presented Pisay tech projects to an international audience. Besides the research presentation, the Pisay students also participated in other fun ISSF activities, such as the Science Challenge, a science-themed Amazing Race. The three students, who merged with another set of American students, likewise, topped the competition. The ISSF is an event hosted by members of the International Science Schools Network on a rotating basis. The PSHS Main Campus was invited to become an associate member, giving the country

a chance to host the event in the future and to present the local science education scene to the international community. The students also joined a holography and optics workshop, where they created and took home their own miniholograms. A hologram is a three-dimensional image projected from lights coming out of a twodimensional surface. During the workshop, the students also tinkered with fiber optic technologies that were made by Nobel Prize winners. A visit to two aerospace companies, Thales and Airbus, also gave the Pisay students an idea on how the industry works. They were shown Thales’s business processes and Airbus’s design conceptualization. To cap off the event, the participants gathered in an Alice in Wonderlandthemed tea party. Indeed, the fair was able to highlight that science is not all about excellence; it can be a whole lot of fun too. The ISSF convened teachers and students of science high schools from Asia, Africa, Europe, Australia and the United States to share their researches and celebrate science. S&T Media Service

Six botanical pesticides being developed

esearchers from the Central Luzon State University have found six plants possessing botanical pesticide or biopesticide properties, which can be an alternative to commercial pesticides. A biopesticide is a substance derived from plants capable of protecting selected crops against certain diseases and pests. The team of researchers, led by program leader Dr. Annie Melinda Paz-Alberto of the Institute of Climate Change and Environmental Management, has developed six biopesticides from plants collected in Central Luzon provinces—Nueva Ecija, Bataan and Aurora. However, the biopesticides have to be further studied, field tested and patented prior to its promotion to farmers. Plant samples were collected from the forests in identified sites. They were later screened to determine whether they have potential as biopesticide and processed into liquid biopesticide. Dr. Ronaldo Alberto, the project focal person, explained that the biopesticides extracted could not be applied to crops as a

preventive or curative measure. However, the preventive approach is more effective based on their microplot trials on selected crops, like tomato, pepper, bitter gourd and onion. The screening of indigenous plants as sources of biopesticides for vegetables, such as in lettuce, cabbage, tomato and sugarcane, is being done in Northern Mindanao. So far, 11 plant species with pesticidal properties have been collected and are undergoing tests to find out which can be used as biopesticides. The biopesticides were developed under the Biodiversity Industry Strategic S&T Program of Philippine Council of Agriculture, Aquatic and Natural Resources Research and Development of the Department of Science and Technology. It hopes to address the challenges in biodiversity through the assessment and conservation of critical biological diversity for ecosystem services and development of biodiversity-based products, such as biopesticides, nutraceuticals, food and novel products. S&T Media Service

DOST opens door to public on S&T Week

he Department of Science and Technology (DOST) will open its doors to the public during the celebration of the 2016 National Science and Technology Week (NSTW), dubbed as “Juan Science, One Nation,” from July 25 to 29. This year’s NSTW will be celebrated simultaneously in all DOST regional offices and in the four major science hubs in Bicutan, Taguig City; Quezon City; Manila; and Los Baños, Laguna. Newly installed Science Secretary Fortunato T. de la Peña will lead the annual NSTW activities at the DOST Complex in Bicutan, Taguig City, as the celebration kicks off on July 25. The event will be de la Peña’s first major science and technology (S&T) activity upon his assumption to office under the administration of President Duterte. “This is the first time that the DOST will be doing a simultane-

ous celebration not only in Manila, but in the different regions of the country,” de la Peña explained. “We hope to sustain the enthusiasm on science and technology created by the past administration and work on what remains to be resolved for the benefit of even those who are on the outskirts of development.” The 2016 NSTW will feature several technology open houses, symposia, scientific forums, technology fairs, film showings, scientific career talks and technology launches, among others. “For those who are in Metro Manila,” de la Peña added, “you can choose to visit our exhibits on disaster preparedness, weather and education in Pagasa [Philippine Atmospheric, Geophysical and Astronomical Services Administration], Phivolcs [Philippine Institute of Volcanology and Seismology] and Philippine Science High School in Quezon City; and in SM MOA [Mall of Asia], where the Food and Nu-

trition Research Institute, and the Philippine Council for Health Research and Development will feature health- and nutrition-related forums and other fun activities.” On the other hand, DOST’s main office in Taguig has prepared numerous treats for those who will be visiting the NSTW celebration. Among the activities lined up are food tasting on DOST-assisted products called Future Flavors; technology forums on livelihood; career talks; product launches; science film showings; and many more. The Los Baños Science Community will hold open houses on research and development facilities, and testing laboratories on forest products at the Forest Products Research and Development Institute. Moreover, technologies on agriaqua sector will be on display on the S&T exhibits of the Philippine Council for Agriculture, Aquatic and Natural Resources Research and Development.

A Worker at the Department of Science and Technology Complex in Bicutan, Taguig City, installs banners and tarpaulins in preparation for the nationwide celebration of the 2016 National Science and Technology from July 25 to 29. Simultaneous celebrations will take place in all DOST regional offices and in the four science hubs in Taguig City, Quezon City, Manila and Los Baños, Laguna. S&T Media Service

For those in provinces, DOST regional offices have prepared various exciting activities that will surely entice everyone to join the celebration. The NSTW is celebrated every

third week of July as mandated by Proclamation 169 of 1993. It aims to recognize the contribution of S&T in the development of the country and garner support from public and private institutions for

its sustainable development. For more information, please visit www.nstw.dost.gov.ph and NSTW Facebook page at 2016NSTW or email 2016nstw@gmail.com. S&T Media Service

A14 Monday, July 11, 2016 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

The impunity of the politically powerful

OR only $2 million—less than P100 million—you can enjoy dinner for two in Singapore. This dinner is an eight-hour retreat that includes 10,000 fresh roses, an 18-course dinner, vintage wines and the one-of-a-kind Jane Seymour Fancy Vivid Blue diamond ring.

According to Forbes Magazine, “Two guests will be seated in custom-made designer furniture and will eat using diamond-studded chopsticks that have their names engraved in them.” Hundreds, if not thousands, of Filipinos could easily afford this adventure. However, just money does not qualify the buyer. “The experience will only be sold to a qualified individual. Factors being considered include the buyer’s status [just how influential is he or she], the buyer’s affinity for blue diamonds, and how he or she plans to flaunt/display ‘The Jane Seymour ring.’” After providing for the needs of basic survival, human societies have grappled with its greatest problem: crime and punishment. No matter which form of government, from authoritarian to utopian, stopping wrongdoers and then punishing those who commit crimes still is a dilemma. We struggle with defining and then balancing the “rights” of the victims with the rights of the criminals. Even the supposedly iron-clad rule of law is in question. Singapore’s Lee Kuan Yew wrote, “In criminal-law legislation, our priority is the security and well-being of law-abiding citizens rather than the rights of the criminal to be protected from incriminating evidence.” In the commercial marketplace, we expect that a buyer with the money can purchase whatever product is for sale. While perfectly true that the seller can decide who to sell to, there is something uneasy about that concept as having to qualify to purchase the Singapore dinner-for-two. In law and society, it is the idea of “impunity.” Impunity is the “exemption from penalties granted by authorities or statutes.” By the written law, for example, a sitting Philippine president cannot be sued or have legal cases filed against him or her. There are valid reasons for that. But we know as a truth that the politically and/or financially powerful can gain even more power by not being subject to the laws that the rest of us “little people” are subject to. The city mayor parks illegally and is not given a ticket. The senator moves to the front of the line and is given preferential treatment. The drug lord has a more luxurious life behind bars than millions of law-abiding citizens have in their own homes. The United Nations Commission on Human Rights writes this: “Impunity arises from a failure by state to meet its obligations to investigate violations; to take appropriate measures in respect of the perpetrators, particularly in the area of justice, by ensuring that those suspected of criminal responsibility are prosecuted, tried and duly punished.” When the government—or even the people—gets to decide who is investigated and prosecuted for potential crimes, we are only a few steps removed from the time when the toughest or most politically connected person in town can make the rules for the weak. At that point, civilized society fails.

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PCSO Q1 accomplishments Atty. Jose Ferdinand M. Rojas II

RISING SUN

HE Philippine Charity Sweepstakes Office (PCSO), as the government’s arm for charitable works, continues to fulfill its mandate to generate funds for the people’s medical and health-care needs and other services. In the first quarter of this year, revenues from the PCSO games—including Lotto and Keo—amounted to P9.22 billion. Lotto is still the most popular game, accounting for 76 percent of sales. During this period, there were 14 Lotto jackpot winners who received a total of nearly P616.5 million, with a Grand Lotto 6/55 patron winning the highest recorded jackpot prize for the first quarter this year, amounting to P159.2 million. From the gaming revenues, 30 percent is allocated by law to the PCSO’s Charity Fund. In the first quarter, P1.732 billion was allocated from the fund to help 57,471 people nationwide for their hospitalization or other medical procedures or treatments, including surgery, chemotherapy and dialysis, through the PCSO’s Individual Medical

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branches of 25 in 2010. The expansion of the At Source Ang Processing Program is proceeding smoothly, with 21 hospitals now partners of the PCSO in delivering the agency’s Imap services through the PCSO help desks located on their premises. The social workers handling the help desks accept requests for the PCSO assistance, making it easier and more convenient for patients or their families to submit their paperwork to PCSO offices. More hospitals are expected to join the program nationwide later this year. These and other accomplishments are the manifestations of the commitment of the PCSO family to its mandate and duty in providing service, charity and compassion to our kababayan around the country.

Ortuoste and Onofre “Noy” Consolacion III, for completing their respec t ive g radu ate cou rses last month. Jenny graduated with a PhD Communication degree from the University of the PhilippinesDiliman College of Mass Communication on June 26. She received the Best Dissertation award for her research into the culture and communication of local horseracing, a pioneering work in Philippine subcultural studies and sociolinguistics. Jenny also developed a framework for studying subcultures in general, using theories of social construction and semiotics, and compiled the longest and most comprehensive lexicon for salitang karera (horseracing lingo) to date. Noy successfully defended his thesis to obtain a Master in Business Administration degree in the Regis program of Ateneo de Manila University’s Professional Schools. He employed portfolio analytical tools to examine the marketing program of the PCSO and suggest ways for increasing revenue. My best wishes to Jenny and Noy as they employ their new knowledge and skills in continued service to the Filipino people.

nnn

Congratulations to two of my executive assistants, Jenny

Atty. Rojas is vice chairman and general manager of the Philippine Charity Sweepstakes Office.

Brexit, the opportunities it brings and the accountant Dr. Conchita L. Manabat

DEBIT CREDIT

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Assistance Program (Imap). The PCSO served nearly 2,000 patients in the first quarter in its conduct of seven medical and dental missions, while 5,909 walk-in and referred indigent patients were treated under the agency’s outpatient department services. Under the Medicine Donation Program, 32 beneficiaries received P774,286 worth of basic medicines for the use of communities. To assist local government units (LGUs) during emergency situations, 112 brand-new ambulances were distributed throughout the country under the Ambulance Donation Program. Two more branches, in Romblon and Aurora, were added to the PCSO’s network in the first quarter, bringing the total number of branches nationwide to 53, more than double the number of

Under the Medicine Donation Program, 32 beneficiaries received P774,286 worth of basic medicines for the use of communities. To assist local government units during emergency situations, 112 brand-new ambulances were distributed throughout the country under the Ambulance Donation Program.

“The International Federation of Accountants [Ifac] has always stressed that governments, businesses and the regulatory community across the globe must work together, cooperatively, to respond to the challenges being faced by our interconnected financial markets and economies. Brexit makes this collaborative approach all the more vital, and the global accountancy profession must be engaged in bringing its experience and expertise to bear in many of the areas where work will be needed.” —Fayezul Choudhury, CEO, Ifac

N June 23 the United Kingdom had a referendum to decide whether it should “Leave” or “Remain” in the European Union (EU). The Leave vote had it at 52 percent to 48 percent. BBC reported it was highest in the UK-wide vote since the 1992 general election with a registered 71.8-percent turnout, representing more than 30 million people. The projected departure of the UK will still leave 27 EU member-states. The decision brought turmoil to the financial and capital markets. Speculations on the state of the global economy, the EU, the UK and the emerging markets have been discussed in different fora and have been captured by the media. Various opinions have been expressed, yet it

may still take time for the eventual UK departure from the common market. As this is the first departure of a major member-state, processes and timelines will be drawn up and observed for the separation. Any change brings with it opportunities. To the practicing profes-

The mode of financial reporting of UK companies may not change much, as the UK may still continue what has been in place, observing the globally accepted financial reporting standards and practices. Jurisdictional laws, rules and regulations on trade and commerce, especially taxation, as well as migration, will be affected.

sional accountant servicing clients with international businesses to include the UK, what will the change in the EU composition mean? The mode of financial reporting of UK companies may not change much, as the UK may still continue what has been in place, observing the globally accepted financial reporting standards and practices. Jurisdictional laws, rules and regulations on trade and commerce, especially taxation, as well as migration, will be affected. Going back to what they were before joining the EU (more than four decades ago) is not feasible. The cost of doing business in the UK will not be the same anymore. There will be a number of adjustments that should be aimed at making the stand-alone UK stronger than what it has been as EU member. This will be the battlecry of those who pushed for Leave the

EU and who will take the lead toward the new era for the UK. The professional accountant needs to be attuned to all the developments and to be well versed on the changes to be able to provide the appropriate services to his or her clientele. Likely areas of professional practice that will be enhanced are the tax and advisory services. This will translate to more engagements and billable time charges. As in any change, businesses, organizations and persons can be resilient to adopt to the evolving landscape. The professional accountant always has an important role to play in any era, circumstances and place. Dr. Conchita L. Manabat is the president of the Development Center for Finance and a Trustee of the Finex Development and Research Foundation. A past chairman of the International Association of Financial Executives Institutes, she now serves as the chairman of the Advisory Council of the said organization. She was once the head regulator of the accounting profession in the Philippines and she founded the Deloitte firm in the country. She can be reached at clm@clmanabat.com. This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.

opinion@businessmirror.com.ph

Opinion

Common station

Do PPP contracts fall under the PHL Competition Act?

BusinessMirror

By Alberto Agra

Atty. Lorna Patajo-Kapunan

PPP Lead

legally speaking

n September 2009 SM Prime Holdings (SM) and Light Rail Transit Authority (LRTA), entered into a memorandum of agreement (MOA), whereby, in consideration of P200 million, the government agreed to construct the proposed Metro Rail Transit (MRT)-Light Rail Transit (LRT) common station (light rail expansion project), which would link MRT Line 3, LRT Line 1 and, eventually, MRT 7, across the SM City North Edsa Annex building, and to name this common station after the aforesaid mall. This MOA aimed to provide a common station for easy passenger transfer among these light rail lines. At present, there exist three connecting light rail stations in the metropolis, namely, the Taft Avenue and Edsa stations in Pasay City, which connect the MRT 3 and LRT 1 lines; the Doroteo Jose and Recto Avenue stations in Manila, which connect the LRT 1 and LRT 2 lines; and the Cubao station in Quezon City, which connects the LRT 2 and MRT 3 lines. It should be noted that these connecting lines are not really interconnected but housed under different roofs, such that commuters, who need to transfer from one line to another, must walk a considerable distance. The MOA would have solved this inconvenience of millions of commuters riding our light rails every single day, by systematically connecting the three lines in one place. If implemented, commuters would only need to walk a short distance within the same station to transfer from one line to another. However, in 2013, the Department of Transportation and Communications (DOTC), which took over the implementation of the light rail expansion project from LRTA, decided to move the station hundreds of meters away to an area near the adjacent TriNoma Shopping Mall. According to the DOTC, TriNoma is the more ideal location because a central business district is being

developed on a 29-hectare property right beside it and, therefore, a lot of commuters will be in that area. The DOTC further defended the government’s move to transfer the location of the common station by saying that construction of the common station in front of TriNoma would take less time and the government would be able to save P1 billion. As expected, SM filed a complaint for specific performance with damages against the DOTC and LRTA with the Regional Trial Court in Pasay City. SM also filed a petition for injunction with prayer for temporary restraining order (TRO) and writ of preliminary injunction against these agencies with the Supreme Court, which, in a resolution dated July 30, 2014, issued the TRO prayed for. In May of this year, the high court also denied LRTA and the DOTC’s motion to lift the said TRO. Because of the court battle, all the government could do now is to have its fingers crossed in the hope of the legal issue would be resolved soon. While this project, apparently, would help in reduce traffic congestion and provide our commuters relief from the everyday horror and nightmare of commuting along Edsa, the Duterte administration, by all means, must look deep into the cause of it being stalled, so that the heads of the officials responsible, therefore, can be put on the chopping block.

Continued from A1

en days from today, the PCA will mark its first year. On July 21, 2015, the former president signed into law Republic Act 10667. The PCA defines three prohibited acts—anticompetitive agreements, abuse of dominant position and anticompetitive mergers and acquisitions.

Anticompetitive agreements: An anticompetitive agreement is a pact between competitors where competition is substantially prevented, restricted or lessened. A PPP contract between government and the PSP cannot be considered anticompetitive since the implementing agency and the PSP are not competitors, since one has no control over the

other, and the PSP secures the award after a competitive process. However, if competitors or bidders agree to restrict the price, suppress bids, rotate bids or allocate the market, this may be covered under this prohibited act. Abuse of dominant position: A dominant position refers to a position of economic strength that an entity

Inter Press Service

UALA LUMPUR, Malaysia— When the financial crisis preceding the Great Recession broke out in late 2008, attention to the previously ignored United Nation Secretariat’s analytical work was greatly enhanced. This happened as the UN and the Bank of International Settlements (BIS) had been almost alone in warning, for some years, of the macroeconomic dangers posed by poorly regulated financial sector developments. In contrast, most other international organizations—the International Monetary Fund (IMF), the World Bank and Organisation for Economic Co-operation and Development (OECD)—which monitor developments in the world economy, have failed to see the crisis coming. Until the third quarter of 2008, they were still predicting continued robust growth of the world economy and “soft landings” in the unlikely event of financial turmoil, including in the US. Thus, the UN was in a strong position to lead the global response to the crisis. However, although “second opinions” were offered to member-states upon request, in practice, it largely remained business as usual. Each part of the international system carried on with their own work programs with obligatory references to the crisis and its impacts. There was no coherent response or sustained attempt to seriously address fundamental issues. Meanwhile, although there have been some occasional signs of recovery, economic stagnation in most developed economies continues, with high joblessness and underemployment. Occasional signs of recovery have been uneven, and easily reversible. Early withdrawal of stimulus measures in 2009 pushed the global economy into

stagnation, especially as private consumption and investment spending remained weak. Most developing countries have remained vulnerable, with little fiscal space to be able to respond to shocks. Their policy space remains restricted, especially following the collapse of mineral and other primary commodity prices, and continued denial of the need for countercyclical macroeconomic policies by most influential policy-makers. The poorest countries and communities also face the prospect of a resurgence of poverty and hunger. In recent years, the push to cut social-security institutions and spending threatens to eliminate the main remaining forms of social protection. Meanwhile, efforts to strengthen prudential regulations in developed countries have been indefinitely postponed since 2009, with the first signs of recovery in response to financial-market pressures, once it had been rescued. Since then, there has been little serious discussion of reforms in the international financial system. In 2009 the UN secretary-General called for a Global Green New Deal, seeking internationally coordinated fiscal stimuli, involving major investments in renewable energy (RE) and other long-neglected global public goods. At its April meeting, the Group of 20 successfully mobilized over a trillion dollars, but these mainly enhanced IMF resources and, thus, further empowered the Washington-based international financial system. The UN emphasized the promotion of sustainable energy to address the looming climate-change challenge. In the face of limited private investments, it argued that public investments had to take the lead, to help quickly bring down the unit costs of renewable sources. But the proposal was then rejected as

or entities, private or even government, hold which makes it capable of controlling the relevant market independently of the competitors, customers, suppliers or consumers. Being in a dominant position is not by itself illegal. The abuse by reason of such position is. There is abuse when such entity substantially prevents, restricts or lessens competition through means listed under the PCA. There could be no abuse if a PSP wins against other bidders for a natural or legal monopoly, thereby, gaining a dominant position. In which case, there is no abuse resulting from a dominant position because the “dominance” resulted from a competitive process. Prior to the award, none of the PSPs or bidders could drive out competitors or impose barriers to entry since they are all on equal footing. Anticompetitive mergers or acquisitions: Some may argue that when a PPP arrangement involves a merger or joining of government and

the PSP, or when the PSP acquires and obtains control over a government asset, this substantially prevents, restricts or lessens competition. In which case, if the transaction value is more than P1 billion, there must be prior notification to the PCC, otherwise, the PPP contract is void and the parties, including the government agency, can be meted a fine. I believe the framers of the PCA did not intend this. If this were the intent, then Congress should have included the build-operate-transfer law in the repealing clause of the PCA. Further, there could be no merger or acquisition, which may be considered anticompetitive if the entity/PSP wins in a competitive and fair process conducted by government itself. Prior to the award, there is competition for the market. After the award, there is no more competition in the market. This is the legal and logical consequence of the award of a PPP contract. Otherwise, there can be no PPP contracts where the PSP is given an exclusive concession.

The US job recovery has more room to run

By Mark Whitehouse | Bloomberg View

.S. job growth rebounded in June from a brief slump that had many concerned about the outlook for the economy. The crucial question now: How long can it go on?

The employment report for June suggests that US employers were doing well in the weeks before Britain’s vote to leave the European Union. The Labor Department’s establishment and household surveys, conducted in mid-June, indicate that nonfarm employers added 287,000 jobs, bringing the three-month average to a robust 147,000 and helping keep the unemployment rate at a low 4.9 percent (up 0.2 percentage point from May, thanks largely to an increase in the number of people actively seeking work and, hence, counted as unemployed). Economists, though, don’t expect this pace of employment growth to last. At some point, job

gains must fall more into line with the natural growth in the labor force, which the Bureau of Labor Statistics estimates at about 65,000 people a month during the next decade. If hiring doesn’t slow, the competition for workers will eventually become so intense that wages and prices will spiral upward. What everyone needs to know, then, is how many workers are still in reserve—that is, how many more people employers can hire before they’ll be constrained by natural growth in the work force. One way to get a sense: Look at the number of people stuck in parttime gigs or on the sidelines of the labor market, and estimate how many full-time jobs would be needed to

The UN and global economic stagnation By Jomo Kwame Sundaram

Monday, July 11, 2016 A15

inappropriate owing to the higher costs of RE. In fact, subsequent developments have shown that the UN was too cautious as the costs of RE have fallen much faster than it anticipated although the recent oil-price collapse has limited its competitiveness once again. Another element in the UN proposed new deal involved strengthening world food security by encouraging investment in food agriculture by small farmers, again with public investment leading, supplemented by official development assistance (ODA). In addition, there was growing recognition of the need to completely eradicate poverty and hunger with extraordinary measures under the rubric of “social protection.” Insofar as such measures would also enable beneficiaries to enhance their productive assets and capacities, they would also ensure higher incomes and more investments, thus, accelerating economic recovery, greater resilience and self-reliance in the medium term. Recognizing the critical role of the 1944 Bretton Woods conference and the institutions it created for post-war recovery and post-colonial development, the UN also called for reforms to the international financial system to better address new circumstances and challenges. The 2008 second Financing for Development conference in Doha reiterated the Monterrey Conference’s call to mobilize the international community for accelerated debt relief, improve international tax cooperation, better developing countries’ access to developed country markets, and enhance developing country access to technology, especially for life-saving drugs and RE. If UN initiatives had not been blocked by some OECD countries, it is likely that the world would have developed a debtmanagement framework to address the Icelandic, Greek and other debt

crises, as well as greater international tax cooperation to better address massive and still growing tax evasion and fiscal constraints faced by so many governments today. The June 2009 High-Level Conference on the Global Financial and Economic Crisis made specific proposals for urgent actions, many of which were later elaborated by the Stiglitz Commission Report’s recommendations. But some hints of recovery provided the pretext for the U-turn to “fiscal austerity” in Europe once the commanding heights of most powerful financial interests had been rescued. In early 2009, the UN system committed to supporting member-states to reorient their macroeconomic policy frameworks to include full employment as an explicit target for both developed and developing countries. But without resources and facilities to support the provision of appropriate policy advice, few countries have sought UN assistance for countercyclical macroeconomic management since. Thus, despite its long-standing mandate and better track record than most other international financial institutions, a greater proactive role of the rest of the UN system has been denied by a coalition of powerful countries. Sadly for the world, this marginalization threatens the very future of economic multilateralism, as has long been evident from the continued hegemony of the Washington Consensus, and at the Addis Ababa third UN Financing for Development conference last July and the World Trade Organization ministerial in Nairobi in December.

Jomo Kwame Sundaram was the assistant secretary-general for Economic and Social Development in the United Nations system during 2005 to 2015, and received the 2007 Wassily Leontief Prize for Advancing the Frontiers of Economic Thought.

bring that number back down to the normal or expected level. Judging from an analysis developed by the economists David Blanchflower and Andrew Levin, that employment gap stood at about 2.1 million in June. That’s pretty significant, but it’s down a lot from about 4 million a year ago. Here’s how that looks: Another approach is to look at the share of the population employed, and figure out how many more jobs would be needed to bring it back to its prerecession level. Focusing only on people in the prime working years of 25 to 54 (to strip out the effects of an aging population), this shortfall stood at 2.9 million in June, down from 3.7 million a year ago. To be sure, there’s no guarantee that all these potential employees will actually materialize. Some may be so discouraged or their skills have eroded so much that they’ll never work again.

Still, these two measures suggest that, in principle, job gains might be able to exceed natural growth in the labor force for another few years or even more. The longer they do so, the more they can reverse the damage done by the 2007-2009 recession. Other measures, too, suggest that the economy’s reserve of extra workers isn’t yet exhausted. The average hourly wage rose 2.6 percent in June from a year earlier—well-below the pace of previous expansions, indicating that demand for labor is not yet outstripping supply. Also, a lot of people are still joining the labor force every month, either to take a job or to look for one—a sign that workers are available if employers want them. In short, there’s no intrinsic reason for the US jobs recovery to end anytime soon—unless some outside force, such as a policy mistake or the repercussions of the Brexit vote, stops it.

Police need more support from American public

allas Police Chief David Brown said something on Friday that needed saying. After updating the public on a sniper attack that targeted white police officers—killing five officers and injuring at least six—Brown spoke about the heroism of the police who ran toward gunfire “with no chance to protect themselves, to put themselves in harm’s way, to make sure citizens can get to a place of security.” Police officers all over the country take such selfless risks every day. They are not especially well-compensated for it. Their major reward derives from the satisfaction that comes from protecting people and the respect that society accords them for performing a dangerous but indispensable public service. Public support for their profession is essential to attracting and retaining people who will serve with honor and integrity. “Please join me in applauding these brave men and women who do this job under great scrutiny, under great vulnerability,” Brown said, “who literally risk their lives to protect our democracy.” Normally, that request would not be especially noteworthy. It is a ritual of American life that the murder of a police officer is followed by expressions of appreciation for the sacrifices they make and the work they do. But this time, the ritual is playing out against the sense of resentment against the police that spawned the Black Lives Matter movement. This week, there were two disturbing police shootings of black men, in Louisiana and Minnesota. And on Thursday evening, marchers took to the streets of Dallas and other cities to protest. Over the past two years, these kinds of demonstrations have helped focus public attention on the use of excessive force by police—and

they have led to changes in the way police departments operate. Dallas is a perfect example. Under Brown, the city has embraced many of the very reforms that protesters call for: training officers to act with restraint and deescalate tense situations, reporting incidents of excessive force more transparently and adopting communityoriented policing tactics. Yet officers in Dallas, as elsewhere, still feel under siege. Marchers chanted, “No racist police, no justice no peace!” One carried a sign that read “Blu Klux Klan.” Marchers in other cities have routinely characterized the police as racists, and some have included especially virulent and incendiary language. There are, of course, racists within police departments. But probably no more than in most other professions, especially as departments become increasingly diverse. When protesters paint with a broad brush, they increase tensions with the police, and that can lead to events beyond their control. The officers in Dallas were not the first to be assassinated by a gunman motivated by retribution for police killings. To be clear, demonstrators are not responsible for the deaths of the five officers, or the injuries suffered by the police and civilians. Only those who plotted and carried out the act are. But it’s not enough to condemn the attacks and those who committed them. More is required—and that is why Brown’s heartfelt plea at the end of his news conference must be heard across the country. “We don’t feel much support most days,” Brown said. “Let’s not make today ‘most days.’ Please, we need your support, to be able to protect you from men like these, who carried out this tragic, tragic event.” Bloomberg View

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Monday, July 11, 2016

₧1.6-B civil-registry PPP seen advancing

LTHOUGH already running behind schedule, the government is still looking to advance the computerization of the country’s civil registry, which has been stumped by bidding problems. Public-Pr ivate Par tnership (PPP) Center Executive Director Andre C. Palacios is bullish that the second phase of the P1.6-billion Civil Registry System-Information Technology Project of the Philippine Statistics Authority (PSA) will finally move forward with the new administration. The deal is still in limbo as it

awaits the approval of the National Economic and Development Authority-Investment Coordination Committee (ICC) because only one party submitted a bid. “The civil-registry deal is considered as urgent and long overdue,” he said. “We will recommend the inclusion of the project on the agenda of the ICC on August 2.”

Unisys Public Sector Services Corp., the current concessionaire for the first phase of the project, was the lone bidder for the deal. The two other bidders, Morpho-Filometrics-Frey Consortium and PNJ Partnership Consortium, backed out during the auction. In the original timeline of the deal, the contract should have been awarded in February this year, but procurement was moved to address the bidders’ concerns. “We need at least six months

to phase in a new operator,” Palacios said. This project will involve the computerization of the civil-registry web site of the PSA and is designed to collect, access, store, maintain and manage civil-registry documents and the specimen signatures of all city and municipal registrars using imaging technology. Moreover, a building that will house information-system servers will be built and outlets will make civil-registry services available nationwide. Alyssa Divina

The civil-registry deal is considered as urgent and long overdue.”—Palacios

DTI to hit MSME job-generation goal this year

he Department of Trade and Industry (DTI) is confident it will reach its goal of generating more than 300,000 fresh jobs in the micro, small and medium enterprise (MSME) sector for the year. Trade Undersecretary for Regional Operations Zenaida C. Maglaya said per the targets in the government’s Philippine Development Plan, the agency already achieved nearly half of the 2016 jobs target in the MSME sector as of May.

Based on data given by the group, the target number of jobs for the year in the MSME sector is at 348, 122. Jobs already created by the sector through the DTI’s initiatives, as of May, number to 162,785, or 47 percent of the target. In terms of assistance, 56, 844 MSMEs were aided in the first five months of the year, or 45 percent of the DTI’s 2016 target for MSME assistance of 126,898 enterprises. Considering the slate of continuing pro-

grams of the DTI-Regional Operations Group (ROG) for MSME Development, these targets may well be exceeded, Maglaya said. Establishment of Negosyo Centers (NCs) has been a key task of the DTI-ROG since the passage of the Go Negosyo Act, and serves to facilitate the registration and capacity building of MSMEs. According to a previous statement, there are now 250 NCs established nationwide since the program’s start in 2013. Another project started just this year, the “Negosyo, Konsyumer, at Iba Pa” (NKATBP), aims to bring the DTI’s menu of services to all 16 regions to serve MSMEs in far-flung areas. In its most recent staging of the NKATBP for the Cordillera region, 1,000 to 1,500 participants attended the two-day road show, which entailed providing training sessions on food safety, intellectual-property rights and business ethics, among other topics. Also launched in Baguio recently is the country’s Arabica coffee postharvest processing and cupping facility, under its Shared Services Facilities (SSF) program. The SSF, a pet project of former Trade Secretary Gregory L. Domingo, provides machinery and equipment to a specific locale to help in the value-chain development (in design, processing, or packaging) of specific products. As of April 2016, 1,886 SSFs have been established nationwide, with the combined worth estimated at P866 million. MSMEs, the backbone of the Philippine economy, comprise more than 98 percent of the country’s registered enterprises and generate more than 61 percent of jobs for the national work force. Catherine N. Pillas

CA junks Nestlé bid to block San Miguel use of coffee label Continued from A1

In a decision written by Associate Justice Myra Garcia-Fernandez, the CA dismissed Nestlé’s petition to set aside the decision by the director of the Intellectual Property Office (IPOPHL) nearly three years earlier. The Ipophl, on August 13, 2012, upheld the resolution issued by the director of the Bureau of Legal Affairs giving due course to the SMC application to register the mark “San Mig Coffee Strong Sugar Free” label design for its coffee product. It specifically sought to register the words San Mig Coffee with a double-leaf design above the letter “I” appearing above the word coffee, printed above the phrase sugar free and a picture of a red-orange mug filled with coffee and the stylized word “strong.” Nestlé, however, objected to the registration of the marks, saying it was the first to adopt, use and file an application for registration in the Philippines of the “mug device” or mug and the “red” mark for several goods, among which was coffee. Thus, Nestlé claimed the right to exclude others from registering or using identical or confusingly similar mark as provided under Section 147 of Republic Act 8293, or the Intellectual Property Code of the Philippines.

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PHL WON’T TELEGRAPH NEXT MOVES IN SOUTH CHINA SEA DISPUTE By David Cagahastian @davecaga

alacañang on Friday said it would wait and study the upcoming ruling of the United Nations’ Permanent Court of Arbitration on the South China Sea dispute before deciding on what to do with a likely favorable decision. Communications Secretary Martin M. Andanar clarified an earlier statement by Foreign Secretary Perfecto R. Yasay Jr. that the Philippines is ready to have bilateral negotiations with China regardless of which way the verdict will go, including possible negotiations on joint exploration and exploitation of natural resources in the disputed territories. “To that question, we will have to wait for the final decision of the UN Permanent Court of Arbitration at The Hague. And then, once they have decided, what we will do is to study the decision. After the solicitor general has studied the decision, then that’s the time that we shall explore our next move,” Andanar said in an interview over state-owned Radyo ng Bayan. On Friday Yasay was quoted as saying that the Philippines is willing to talk to China whether it wins or loses in the arbitration case filed by Manila before the UN. He said the talks with China could dwell on joint exploitation of

natural-gas reserves and fishing grounds within the Philippines’s exclusive economic zone. But Yasay later on clarified that the joint exploitation of natural resources is just one of the options for the Philippines in trying to resolve the territorial dispute. President Duterte, before being sworn into office on June 30, had said the Philippines may go into bilateral talks with China if nothing comes out from efforts to enforce the arbitration ruling in the next two years. However, it appears the Philippines’s strategies in trying to enforce a possibly favorable ruling are already known to China after the televised first Cabinet meeting held by Mr. Duterte in Malacanang when he was sworn in. Yasay told that televised meeting what he thought China would do in the face of a ruling in favor of the Philippines—that China would probably “dig in and put us to a test” and prevent our fishermen from fishing in the disputed Scarborough Shoal again. “If that happens, there is no point for us to yell,” Yasay was quoted by The Associated Press as saying. China is expected to ignore an adverse ruling by the arbitration court, after having repudiated the jurisdiction of the court and having announced the start of military drills in the disputed territories just days before the promulgation of the verdict, which is scheduled on Tuesday.

Q&A: Landmark ruling on South China Sea Continued from A1

US officials brokered an arrangement for Philippine government vessels and larger Chinese maritime surveillance ships to simultaneously withdraw from the tiny shoal, a deal which Aquino said he followed. Chinese ships never left. Chinese coast guard ships also surrounded another disputed area, the Second Thomas Shoal, which has been guarded by Filipino Marines onboard a grounded rusty warship. The Chinese coast guard has tried to block Philippine vessels from bringing food, water, medicines and other supplies to the Marines, sparking dangerous cat-and-mouse chases at high seas. The Philippines said it had no other choice but to elevate the dispute to international arbitration.

Will the arbitration change anything?

Any ruling will be final and legally binding on China and the Philippines. China’s decision to ignore the case and the arbitration tribunal’s lack of enforcement mechanism, however, have blunted the Philippines’s move. Former Philippine Foreign Secretary Albert F. del Rosario, who spearheaded the filing of the complaint against China, said that a favorable ruling on any of the 15 issues raised by the Philippines, especially the demand to declare China’s claims invalid under Unclos, would be a major blow to Beijing and a moral victory that could be harnessed by the Philippines to its advantage. The Philippines, Filipino diplomats said, could work with Washington and other countries to demand Chinese compliance in diplomatic forums worldwide, including before the United Nations. If it doesn’t comply, China risks being seen as a rogue nation at a time it expands its political and economic influence on the world stage. Carpio painted a dire picture if the tribunal fails to rule on the validity of China’s sprawling claims, saying Beijing would enforce its nine-dash territorial lines as its national boundary. The US military would intensify its patrols to promote freedom of navigation, China would try

to push the Americans back and the claimants engage in an arms race. “The only defense of coastal states will be to acquire warships, warplanes and antiship missiles,” Carpio said. “Tensions will increase. It will be a turmoil in the South China Sea.”

Why did China refuse to take part in the case?

China has argued that the tribunal does not have jurisdiction to handle the Philippine case, because it says it involves sovereignty issues, which are outside the tribunal’s legal purview. While masking its case as an effort to clarify maritime rights under the UN convention, the Philippines is actually trying to undermine China’s “indisputable sovereignty,” according to Chinese officials. They ask, for example, how the Philippines can say that China’s claims are excessive without first determining Beijing’s territorial limits. China also regards the disputes as a purely Asian problem that outsiders like the US have no right to meddle in. Philippine officials say China refused to join the arbitration knowing that the historical basis it cites for its territorial claims has long ceased to be recognized under modern-day treaties like the Unclos.

What are other countries saying about it?

Countries have generally taken a position on the arbitration case depending on whether they’re aligned with the US or China. The diplomatic tug-of-war has put smaller countries and regional blocs in a dilemma, including the Association of Southeast Asian Nations, whose four member-states are claimants. A Philippine push for the 10-nation bloc to issue a joint statement calling for China to respect Tuesday’s ruling has stalled with Cambodia and Laos PDR backing the Chinese position. Besides the Philippines and Vietnam, Malaysia, Indonesia and Singapore have also been wary of China. The regional group has a bedrock principle of deciding by consensus, meaning just one member-state can stall any group effort. The US, Britain and the rest of the European Union support the arbitration. AP