Businessmirror june 02, 2018

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Unveiled during the celebration of the 100th year of Philippine Independence on June 12, 1998, the Commemorative Monument of Peace and Unity by Davaoeño sculptor Kublai Milan symbolizes the harmonious coexistence between the indigenous inhabitants and migrant people of multicultural Mindanao. Hugo Maes | Dreamstime.com

Bangsamoro at the crossroads

Can BBL deliver on promise of peace, development? By Bernadette D. Nicolas & Jovee Marie N. Dela Cruz

P

ASSAGE of the Bangsamoro basic law (BBL)—a real possibility soon as both chambers of Congress sit down next week for the bicameral conference committee deliberations on their respective versions—may not only pave the way for ending the decades-long conflict in Mindanao. It can also unlock the economic potential of the South. In a historic move on Wednesday (past midnight Thursday in the case of the Senate), both houses finally passed their own versions of

the BBL on second and third reading a day after the President certified it as urgent. The bill seeks to advance the

creation of the new Bangsamoro region to replace the Autonomous Region in Muslim Mindanao (ARMM). Achieving lasting peace in Mindanao, especially in the Bangsamoro, can boost in overall business confidence and investments, analysts said. Aside from this, Dr. Cielo Magno, assistant professor at the University of the Philippines School of Economics, said the bill’s passage will create job and livelihood opportunities and reduce poverty. According to the Bangsamoro Development Plan, poverty in Bangsamoro remains high as a result of limited access to basic services, limited economic opportunities and the disruption and uncertainty caused by conflict. More than half (55.8 percent in 2012) of the ARMM population lives in poverty. That means an estimated 1.85 million people living below the poverty threshold in 2012, almost three times the num-

ber in 1991. The poverty gap has also increased from 8.8 percent in 2009 to 13.1 percent in 2012, more than twice the national average of 5.1 percent, the study noted. It also showed the ARMM contributed less than 1 percent of national output and has a per capita output less than a quarter of the national average. Between 2019 and 2013, the ARMM registered only a 1-percent average annual per capita GDP growth despite the country reaching 3.4 percent nationally and 3.3 percent in the rest of Mindanao. Despite limited economic opportunities in the Bangsamoro, unemployment stood at 4.6 percent, while underemployment was registered at 12.3 percent—lower than the rest of Mindanao (5.3 percent and 22.9 percent, respectively) and the country (7.1 percent and 19.3 percent, respectively). Magno sees all business from large-scale down to micro, small and medium enterprises benefiting

from the passage of the BBL. “Businesses in general will benefit from the passage of BBL because it will hopefully lead to a peace agreement. It will lead to achieving peace in Mindanao, which will encourage business investment; and also if you have BBL, you will have more clarity in terms of policies and regulations and that includes policies on natural resources,” Magno added, noting that more businesses will be encouraged to locate in the area once the Bangsamoro government is established. “The assumption is: If you have more represented government in the BBL, in the Bangsamoro region, better policies will be implemented, more resources will be provided based on the current draft of the BBL, so hopefully, the availability of these resources will be used to develop the region,” she added. With more resources, including the block grant from the na-

tional government, Magno believes there could be ample development funds for the Bangsamoro. Both BBL versions in the two chambers put the block grant at equivalent to 5 percent of the national revenue from the collections of the Bureau of Internal Revenue and Bureau of Customs. “It should be used to support the new regional government and its development initiatives, which should include improvement in infrastructure, human capital through appropriate health and education services, and other social services,” she said. However, Magno added that what is critical with the passage of BBL is ensuring that its provisions are consistent with the Constitution and other existing laws. Any inconsistency will make it impossible to create an immediate positive effect on the economic environment in the region. Continued on A2

Aviation dreams soar, but infra constraints could keep clipping airlines’ wings APACITY constraints continued to stunt the growth of domestic air travel in Manila in 2017 and unless the problem is properly addressed through infrastructure buildup, development of the overall local aviation market will continue to be stymied in 2018. Based on government data, the domestic air travel market grew by 6 percent to 24.8 million in 2017, the same rate by which it grew a year prior. This, according to think tank Centre for Asia Pacific Aviation (Capa), is quite unusual, given that the market grows at a much faster pace than the local economy, which

advanced 6.7 percent. “The Philippines has had one of the fastest-growing economies in Asia over the past few years. Demand for air travel has naturally increased, but domestic traffic has increased at a rate slightly slower than GDP,” it said. It blamed the infrastructure constraint at the Ninoy Aquino

PESO exchange rates n US 52.5540

“The Philippines has had one of the fastestgrowing economies in Asia over the past few years. Demand for air travel has naturally increased, but domestic traffic has increased at a rate slightly slower than GDP.”—Capa

Alexey Novikov | Dreamstime.com

C

By Lorenz S. Marasigan

International Airport (Naia), the main international gateway to the Philippines. “The 6-percent domestic growth recorded for 2016 and 2017 is relatively low, given that passenger traffic typically grows faster than the GDP,” Capa said in a report. “Manila slot restrictions are obviously a challenge.” The Naia has been suffering from under-capacity—both airside and landside—for almost half a decade now. Slots for new flights have been limited to redeye schedules, or those that are least marketable, as they depart late at night and arrive early the next morning. “Slot restrictions in Manila make it difficult to keep up with rising demand: Manila domestic traffic increased by only 2 percent in 2017, whereas the total domestic market increased by 6 percent,” Capa said. See “Aviation,” A2

n japan 0.4830 n UK 69.9126 n HK 6.7007 n CHINA 8.2026 n singapore 39.2956 n australia 39.7676 n EU 61.4566 n SAUDI arabia 14.0136

Source: BSP (June 1, 2018 )


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