Businessmirror june 13, 2017

Corruption = Monopoly + Discretion - Accountability

I

like the above formula. Corruption flourishes when someone has monopoly power over a product or service and has discretion to decide how much to receive, and where accountability and transparency are weak. So, to fight corruption, we—and that includes all of us—must reduce monopoly power, reduce discretion and increase accountability in many ways.

Nuvolanevicata | Dreamstime.com media partner of the year

United nations

2015 environmental Media Award leadership award 2008

»continued on A2

BusinessMirror A broader look at today’s business

www.businessmirror.com.ph

n

Tuesday, June 13, 2017 Vol. 12 No. 243

T

By Jasper Emmanuel Y. Arcalas

@jearcalas

he Philippines is now being pressured by fellow World Trade Organization (WTO) membercountries to honor its commitment to implement a rice-tariffication scheme, with its twice-extended quantitative-restriction (QR) privilege already set to expire at the end of the month.

A ranking official, who is privy to the recent meeting of the WTO Committee on Agriculture (COA) in Geneva, said WTO member-countries are “closely” monitoring the

ECOP EXPECTS FURTHER CUTS IN JOBLESS RATE ON ‘ENDO’ COMPROMISE By Catherine N. Pillas @c_pillas29

he Employers’ Confederation of the Philippines (Ecop) said it expects the country’s unemployment and underemployment rates to decline steadily after the government allowed certain forms of labor contractualization to continue. Ecop President Donald G. Dee said the Department of Labor and Employment’s (DOLE) issuance of Department Order (DO) 174 on labor contractualization, often called endo, would allow more Filipinos to have jobs this year. “The DOLE’s new labor policy, DO 174, is now being implemented, leading to the improvement in jobs statistics. There could be further improvement if the government pushes through with its ‘Build, Build, Build’ program,” Dee told the BusinessM irror. The Ecop chief made the pronouncement after the National Economic and Development Authority (Neda) and the Philippine Statistics Authority (PSA) released the unemployment data last week. Based on the April 2017 Labor Force Survey of the PSA, an attached agency of the Neda, the country’s unemployment rate went down to 5.7 percent, from 6.1 percent in April 2016. Also, underemployment rate, or the proportion of employed people wanting additional work, declined to its lowest rate in over a decade at 16.1 percent in April. This is lower by 962,000 workers, or 12.9 percent, compared with underemployed workers recorded in April 2016, according to the Neda. Employment in manufacturing

increased by 1.6 percent, or by 55,000 workers, while the gain of the agriculture sector was pegged at 1.2 percent. However, the services sector—which accounts for more than half of the country’s total employment—recorded a net employment loss of 557,000 workers. In March the DOLE came out with DO 174, which reinforced the regulations of the Labor Code. Expanding the list of labor contractualization practices considered illegal and increasing the capitalization requirement for employers engaged in contractualization to P5 million, from P3 million, are some of the salient features of DO 174. The provision enabling an employment contract (with a contractor) to be coterminous with a service contract (with the principal) was also removed. The new DO only strengthened the definition of “labor-only contracting” and what it covers, but allows other forms of contractual work, such as when the outsourcing agency has an independent and distinct business from that of the principal. Ecop said DO 174 is a “tempered compromise” versus the proposal of some labor groups to impose a total ban on contractual work. Under the Philippine Development Plan 2017-2022, the Duterte administration is targeting to cut unemployment rate to as low as 3 percent by 2022, from the 5.5 percent recorded in 2016. The government is also seeking to slash underemployment rate in areas outside of the National Capital Region to as low as 16 percent by the end of President Duterte’s term, from the 19.7 percent posted a year ago.

PESO exchange rates n US 49.5450

process that Manila is undertaking to complete its shift to rice tariffs. “Members questioned the Philippines’s plan to convert its import restrictions into tariffs,” the

business news source of the year

Of Manchester and Marawi

RA 8178

Manny B. Villar

The law that Congress needs to amend to convert the rice QR into specific tariff rates by July 1 under WTO commitments

source said. “Australia, Thailand, the US, the EU, Canada and Vietnam signaled their interest in this matter, and will follow up closely on further updates. They stressed the importance of respecting WTO commitments within the agreed deadline.” The source said the Philippine representative to the COA meeting on June 7 See “WTO,” A2

2016 ejap journalism awards

P25.00 nationwide | 5 sections 28 pages | 7 days a week

WTO members press PHL to meet rice-tariff deadline

T

By Henry J. Schumacher

I

THE ENTREPRENEUR

n 75 days between mid-March and early June this year, the United Kingdom was hit by three terrorist attacks that left dozens dead and more than 100 wounded.

On March 22 52-year-old British citizen Khalid Masood drove his car on the pavement on Westminster Bridge, killing four pedestrians and wounding 50 others. He got out of his car when it crashed into railings and killed an unarmed police officer with a knife before he was shot dead by a bodyguard of a government official. Continued on A10

BMReports

Sharia courts: Then and now By Joel R. San Juan @jrsanjuan1573

A

Part Two

CCORDING to the Office of the Court Administrator (OCA), decisions of the Sharia district courts may be brought before the Supreme Court (SC) by way of civil action. This process is cited by Rule 65 of the Rules of Court and undertaken if there is question of jurisdiction, or petitions for review on certiorari, as a mode of appeal. The OCA said this is in line with Article 145 of Presidential Decree (PD) 1083, which does not alter the original and appellate court jurisdiction of the SC as provided in the Constitution. The decision of the Sharia appellate court, on the other hand, is considered final and executory unless it would affect the original and appellate jurisdiction of the SC. Data obtained from the Court Management Office (CMO) of the OCA showed 29 is the average number of cases decided by the Sharia district court for the past 10 years (2007 to 2016). For the Sharia courts, the average number of cases decided is 402 for the same period. The year 2007 was recorded to have the most number of cases decided by the district courts,

This file photo shows Filipino Muslims near the Golden Mosque in Quiapo, Manila. Court Administrator Jose Midas Marquez said there is a need to create Sharia courts in areas where there is a high concentration of Muslims, like Manila. ALYSA SALEN

totaling to 43 for the period 2007 to 2016, while the year 2013 has the least number of cases decided with only 12.

Case number

IN 2016 district courts resolved

20 cases, while the year before that it was 33 cases decided. Decided cases in 2014 hit 38, while there were 131 resolved cases in 2012, as well as in 2011. Decided cases in 2010 were 29, while there were 21 resolved cases in 2010,

21 resolved cases in 2009 and 29 decided cases in 2008. For the circuit courts, the year 2016 recorded the most number of decided cases with 643, while the year 2007 has the least Continued on A2

n japan 0.4505 n UK 64.1855 n HK 6.3541 n CHINA 7.2866 n singapore 35.8996 n australia 37.3668 n EU 55.5697 n SAUDI arabia 13.2113

Source: BSP (9 June 2017 )

BMReports BusinessMirror

A2 Tuesday, June 13, 2017

Sharia courts: Then and now Continued from A1

decided cases with 201. In 2015 circuit courts resolved 620 cases; 495 in 2014; 371 in 2013; 371 in 2012; 594 in 2012; 442 in 2011; 208 in 2010; 242 in 2009; and 202 in 2008. As of May 8, the total number of pending cases recorded by the CMO-OCA for the Sharia District Courts is 91, while for the circuit courts, the total number of pending cases is 883. The data also showed that the average number of cases filed in the Sharia district courts for the past 10 years, or from 2007 to 2016, is 46. On the other hand, the average number of cases being filed before circuit courts is 519 for the same period. In 2016 53 cases were filed before district court; 35 cases in 2015; 42 cases in 2014; 24 cases in 2013; 33 cases in 2012; 57 cases in 2011; 84 cases in 2010; 60 cases in 2009; 43 cases in 2008; and 26 cases in 2007.

Case input

THE number of cases filed before circuit courts in 2016 totaled to 748; 706 cases in 2015; 804 in 2014; 607 in 2013; 687 in 2012; 419 in 2011; 352 in 2010; 334 in 2009; 290 in 2008; and 246 in 2007. Reports from the Statistical Reports Division through Data Compilation of the SC showed that for the period of January

Legislation is needed to create Sharia courts. Kasi ang kaunti ng kaso. It would be a waste of government funds if we organize the court, tapos walang kaso.”—Marquez

2014 to April 2015, a total of case input of 411,789 cases were from various courts. Case input for judicial cases includes newly filed cases, revived or reopened cases, and cases received from other salas or courts. The total case input for Sharia circuit courts for the said period reached 638, while Sharia district courts recorded 42 as compared to regional trial courts with 220,563. The total case input for metropolitan trial courts for the said period reached 74,297, while municipal trial courts in Cities recorded 75,110. The total case input for municipal trial courts reached 23,095 and municipal circuit trial courts with 18,135.

Case output

On the other hand, the total case output reached 391,523 out of 411,879 total case input. Case output for judicial cases include decided or resolved cases, archived cases and cases

transferred to other salas or courts. The case output for Sharia circuit courts reached 452 out of 638 for the same period while case output of Sharia district court totaled to 40. Thus, the percentage disposal of the Sharia district court was 95.24 percent, while Sharia circuit courts had 70.85 percent case disposal. “Considering that most of the cases filed before the Sharia courts are lodged with the Sharia circuit courts, the nature of cases commonly filed are civil in nature,” Court Administrator Jose Midas Marquez said. Among these civil cases pertains to marriage, divorce, breach of contract to marry; customary dower, disposition and distribution of property upon divorce; maintenance and support, and consolatory gifts; and restitution of marital rights. Marquez, however, said regular courts are still allowed to handle

cases involving Muslim personal laws, particularly, in places were there are no Sharia courts. “Regular courts can take cognizance of cases filed before it, but laws applied are general laws,” Marquez explained.

More needed

MEANWHILE, Marquez lamented that the existing number of Sharia courts are not sufficient to efficiently hand le and resolve disputes involving Muslim personal laws. He said more Sharia courts are need to be established in other parts of the country, citing in particular Manila, Taguig, Baguio City and other areas where there are large Muslim population. “ There is a need to create Sharia courts in areas where there is a high concentration of Muslims,” Marquez said. He added that a legislation is necessary in order to put up more Sharia courts as this would entail necessary funding. “Yes, legislation is needed to create Sharia courts. Kasi ang kaunti ng kaso, [The number of cases is too small],” he lamented. “Waste of government funds if we organize the court, tapos walang kaso.” [It would be a waste of government funds if we organize the court and then there is no case].” To be continued

Corruption = Monopoly + Discretion - Accountability Continued from A1

Reducing monopoly power means enabling competition; in this context we are so happy that the Philippines has competition legislation in place and has the Philippine Competition Commission (PCC) to implement the law. However, it would be great if the PCC would be allowed to do its job without court interferences, in the interest of removing monopolies/duopolies so that corruption can be properly addressed, reduced and finally eliminated. Limiting discretion means clarifying the rules of the game and making them available to everyone. This includes putting government contracts and procurement plans online, create online manu-

als on what is required to obtain a permit, build a house, start a business and so forth. Finally approving the freedom of information (FOI) bills in both Houses of Congress would be another big step in the right direction. We have been talking about the FOI for too long already. Another example for reducing discretion: Simplify the tax code, make it simpler to understand and reduce thereby discretion of BIR employees. Enhancing accountability means many things, and creative leaders in the government and the private sector use a remarkable variety of methods. One way to improve accountability is to improve the measurement of performance. Another method is listening and learning from businesses and from

citizens. This includes mechanisms for public complaints, but it goes beyond the reporting of individual instances of abuse of corrupt systems. Accountability is also increased by inviting outsiders to audit, monitor and evaluate. This is exactly the reason we created Integrity Circles as one of the main avenues to address accountability, transparency and integrity. We did this in the Integrity for Jobs (I4J) project, a project cofunded by the European Commission and the Konrad Adenauer Foundation. We started with nine LGUs and are happy to announce that 60 LGUs are now part of this endeavour. Allow me to add that Integrity Circles are composed of people working in the LGU, being involved in business, and representing civil society (in

many cases the Church). But let’s not forget the press; the media can be and should be an important source of accountability. What about ethics and morality? Successful leaders in the government and the private sector must set a good example. As mentioned above, the key to fight corruption are better systems that provide better incentives for imperfect human beings to perform in the public interest—and to avoid corruption. Let me conclude by highlighting the work we are doing in the Integrity Initiative to create the Integrity Nation Now. As mentioned in previous columns, Integrity starts with I. We need you to become part of our movement; contact me under Schumacher@ integrityinitiative.com.

www.businessmirror.com.ph

WTO. . .

Continued from A1

informed the members that the government has started to move forward to the tariffication of rice imports. “ T he Philippines infor med members that the President and Cabinet have already initiated the process to convert rice-import restrictions into tariffs, and it is currently being considered by the Filipino Congress. The tariffication will be implemented once Congress passes the legislation,” the source said. During the June 7 COA meeting, WTO member-countries sought for updates and clarification regarding the Philippines’s commitments under its waiver on the special treatment on rice. Canberra, for its part, questioned Manila if it would already lift its nontariff measure on rice starting July, according to a document uploaded on the WTO’s web site. Meanwhile, Bangkok sought clarifications on the detailed process Manila is undertaking to complete its rice-tariffication process; particularly, the procedures on its rice imports that it will be imposing, should the process go beyond the June 30 deadline. “Can the Philippines confirm the implementation date on rice-tarification process? In case of delay, can the Philippines clarify procedures from July 1, 2017, to the day that tarification being applied?” the WTO document read, quoting the questions submitted by Bangkok for the June 7 meeting. Washington raised the question whether the Philippines plans to extend the tariff concessions if its government is unable to pass the legislation that would remove the rice QR by July 1. Washington added that it would “appreciate” any updates on the status of Manila’s legislation process and actions to tariff rice imports. “The United States understands that rice tariffication is unlikely to occur prior to the June 30, 2017, deadline for the expiration of the rice waiver, due to a delay in passing the legislation required to remove the QR on rice imports,” the WTO document read. “The Philippines has indicated it may extend the tariff concessions that were granted in exchange for the rice waiver in the event that the required legislation is not passed by the June 30 deadline,” it added. On July 24, 2014, the WTO General Council approved the Philippines’s

waiver on the special treatment on rice, allowing Manila to keep its QR on rice until June 30. However, the WTO General Council approved the waiver on the condition that the Philippines will subject its rice imports to ordinary custom duties by July 1. “At the expiration of this waiver, and no later than June 30, 2017, the importation of rice shall be subject to ordinary customs duties in accordance with paragraph 10 of Annex 5, Section B, of the Agreement on Agriculture,” the WTO General Council decision read. However, in an earlier COA meeting in Geneva in March, the Philippines informed WTO members that it is facing delays in implementing a tariff-rate quota for rice and might exceed the deadline set under the waiver. The delay is caused by the amendment process of Republic Act 8178, or the Agricultural Tariffication Act, which imposed the country’s QR on rice indefinitely. Under RA 8178, rice is the only agricultural commodity with QR and the law did not specify a termination date for it. This means that even if the Philippines’s waiver expires on June 30, the government is still bound to implement the QR on rice, as mandated by RA 8178. A s a sign of “goodw ill ” to its trading partners, President Duterte signed Exceutive Order (EO) 23 last month, extending the concessions made by the Philippines in securing the waiver in 2014. The temporary modification of most-favored nation tariff rates is effective until June 30, 2020, or until such time a law amending certain provisions relating to rice in RA 8178, or the Agricultural Tariffication Act, is enacted, whichever comes first. “The EO of the President is good, because we will preserve the concessions so there would be no motivation for our negotiating partners to sue us,” Agriculture Undersecretary for Policy and Planning Segfredo R. Serrano said in an earlier interview. However, Serrano also reiterated that retaining the concessions is not a guarantee that the country will be able to avoid trade disputes while it is undertaking the necessary processes to convert the import caps into a specific tariff rate. Serrano, one of the country’s trade negotiators, pointed out that moves to amend RA 8178 should prioritize the scrapping of the QR so the Philippines could avoid disputes due to “breach” of trade commitment.

Shell’s perjury case vs former BOC top officials dismissed RIDGE OF A HIGH PRESSURE AREA AFFECTING LUZON (As of 5:00 PM - June 12, 2017)

T

he City Prosecutors Office of Quezon City dismissed the complaint for Perjury against two former top officials of the Bureau of Customs (BOC) and a local journalist in Batangas. In a four-page resolution signed by Senior Assistant City Prosecutor Jaime Villanueva, the Prosecutors Office said it saw no probable cause to file perjury case before the court against former Customs Commissioner Napoleon Morales, former Batangas Customs Collector Juan Tan and Calabarzon journalist Lourdes Aclan. The resolution stated that the perjury complaint filed by Edgar O. Chua, Roberto S. Kanapi and Nigel T. Avila of Pilipinas Shell Petroleum Corp. against the three were based on their complaint filed before the Office of the Ombudsman. The Quezon City Prosecutors Office said the Ombudsman has yet to issue a resolution, so it is premature to conclude that they submitted false affidavit. The resolution said that “since the case before the Office of the Ombudsman is still

pending and there is no pronouncement yet that complainants [Aclan, Morales and Tan] made a deliberate and willful assertion of falsehood in the affidavit submitted to it, it would be premature for complainants herein, as well as this office, to declare that respondents made untruthful statements in the questioned joint complaintaffidavit and charge them of perjury under Article 183 of the Revised Penal Code.” In the perjury complaint, Chua, Kanapi and Avila alleged that respondents Aclan, Morales and Tan deliberately made false statements in their complaint filed with the office of the Ombudsman on September 14, 2016, to charge Pilipinas Shell and its officials with the crime of smuggling, in conspiracy with former President Benigno S. Aquino III and former Finance Secretary Cesar Antonio Purisima, in violation of Section 3601 in relation to Section 3604 of the Tarifff and Customs Code of the Philippines, and for violation of Section 3 (e) of RA 3019, or the Anti-Graft and Corrupt Practices Act.

The Nation BusinessMirror

news@businessmirror.com.ph

Editor: Dionisio L. Pelayo • Tuesday, June 13, 2017 A3

Sereno assures protection of people’s rights

C

By Joel R. San Juan

@jrsanjuan1573

HIEF Justice Maria A. Lourdes Sereno on Monday assured the Filipino people that the judiciary is committed to perform its duty to protect the rights of the Filipino people. Sereno made the assurance in her Independence Day message, a day before the Supreme Court hears the oral arguments on the petitions seeking to nullify President Duterte’s Proclamation 216, which placed Mindanao under martial law following attacks led by the Maute Group. “The Judiciary pays homage to all Filipino heroes; draws inspiration from them; reflects with sorrow on the fallen in Marawi; and renews its commitment to the people to defend

their freedoms,” Sereno said. She also paid tribute to “those who have fought for and continue to fight for our country’s freedom and sovereignty” and also to the country’s “fallen heroes present and past, all of who sacrificed lives and wealth, safety and comfort”. “June 12, 1898 was a day our forefathers, armed only with an indomitable faith in the Filipino’s destiny, fought for and won at great cost. They charged though the most difficult obstacles so that our nation could

live free. Their DNA lives on today in all those who continue to give all they have to ensure that our nation remains free,” Sereno added. She was invited to lead Independence Day celebration at the Bonifacio Monument in Caloocan but begged off, owing to preparations for the three-day oral arguments on petitions seeking to strike down martial law proclamation starting on Monday. Also on Monday, Solicitor General Jose C. Calida submitted its consolidated comment on the three consolidated petitions against Proclamation 216. The three consolidated petitions were filed by opposition lawmakers led by Liberal Party Rep. Edcel C. Lagman of Albay, local Mindanao leaders led by Lumad leader Eufemia Campos Cullamat and a group of women from Marawi City led by Norkaya Mohamad. Calida insisted that proclamation 216 enjoys the presumption of constitutionality, and that petitioners miserably failed to ascribe grave

sereno

abuse of discretion on the President in its issuance. “Quite the contrary, the Proclamation is amply supported by facts that a rebellion does exist, and the public safety requires it,” Calida added. Calida said the Court should dismiss the petitions for “fatal procedural defects or utter lack

of merit or both”. The chief government counsel branded the attacks in Marawi as ISIS (Islamic State in Iraq and Syria)inspired that warranted the implementation of martial law and suspension of the writ of habeas corpus to ensure public safety. He also countered the claim of the petitioners that the declaration Prcolamation 216 had no factual basis. Calida noted that intelligence reports from the Armed Forces served as basis for the proclamation as it laid out the magnitude and scope of the rebellion in the province. Calida also rebutted the argument of petitioners on lack of recommendation from or consultation with the ranking defense and military authorities as reportedly admitted by Defense Secretary Delfin N. Lorenzana when he briefed members of the Senate and the House of Representatives. “The recommendation of the Secretary of National Defense, or any member of the Executive Department for that matter, is not a con-

dition precedent to the President’s exercise of his power to proclaim martial law or suspend the privilege of the writ of habeas corpus. Consequently, the absence of such positive recommendation does not affect the validity of Proclamation 216; neither does it impact on the sufficiency of the factual basis for its proclamation,” he argued. He noted the Maute Group murdered innocent civilians and displaced thousands of families. “Aside from the effects of the attacks on the civilian population, the strong combat capability, and seemingly limitless firepower and other resources that ISIS-inspired rebels have displayed in their attacks show that the interest of public safety required the issuance of Proclamation 216,” Calida added. Even prior to the siege of Marawi, he noted local rebel groups had already launched a series of attacks in other parts of Mindanao indicating a concerted action and community of interest between and among these rebels.

DOJ officials oversee preparations for prosecution of Maute bandits

R

ANKING Department of Justice officials headed by Justice Secretary Vitaliano N. Aguirre II are now in Cagayan de Oro City to oversee the preparations of prosecutors for the start of the inquest proceedings against detained Maute personalities. “As we celebrate Independence Day, we are starting the inquest proceedings for the personalities allegedly involved in the violent attacks on Marawi City and its residents. This is your DOJ’s [Department of Justice] way of liberating the people of Marawi City, as well as the whole nation from the fear of the attacks happening again. When the perpetrators are brought to justice and are made to suffer the full measure of our laws, the Filipino people can once again be free from fear,” Aguirre said in a statement. Joining the delegation are Justice Undersecretaries Antonio Kho Jr. and Renante Orceo. Orceo was tasked to set up the temporary office of the City Prosecutor’s Office of Marawi City in Iligan City and supervise the airlift of the equipment and supplies to the Marawi prosecutors. Earlier the Supreme Court designated the Regional Trial Court in Cagayan de Oro to handle the cases filed against the Maute Group members. Arrested Maute bandits and supporters will be detained at Camp Brig. Gen. Edilberto Evangelista, headquarters of the Army’s Fourth Infantry “Diamond” Division, will serve as the detention area of the arrested suspects. The inquest proceedings started at 1 p.m. on Monday at Camp Evangelista, that is also in Cagayan de Oro City, and the parties subject of the inquest proceedings are tied to the attacks in Marawi City. Aguirre said once they have been subjected to inquest proceedings, the DOJ will work toward having the high-value suspects transferred to Manila to better secure them. Aguirre will also meet with Cagayan de Oro City Prosecutor’s Office Officer in Charge Merlyn Uy to brief him of the level of preparations undertaken in setting up their temporary office. In a related development, Aguirre asked the Department of the Interior and Local Government, through Officer in Charge Catalino S. Cuy, to provide manpower, food and other related resources for the arrested Maute members and supporters that will be detained at Camp Evangelista. In a letter, Aguirre told Cuy that the Armed Forces has no budget to provide for the daily needs of the detained Maute members. “As such, may we request the BJMP [Bureau of Jail Management and Penology], through your office, to provide the adequate manpower, food provisions and other related resources for the arrested members of the Maute group and other lawless elements sympathizing to their cause inside Camp Evangelista, Patag, Cagayan de Oro City,” said Aguirre's letter, which will be sent to Cuy on Monday.

AGUIRRE

Authorities already have in custody Cayamora and Farhana Maute, the parents of the brothers Omar and Abdullah who are leading the bandit group holed up in Marawi City. Arrested with them are some of their relatives, while the authorities confiscated cash and various types of firearms from their group. Aguirre will return to Manila on Tuesday, while Kho was tasked to stay in Cagayan de Oro for as long as needed.

Half staff

THE Armed Forces is requesting all government agencies to fly their flags at half staff starting on Tuesday in honor of the fallen troops who gave their all to free Marawi City from the clutches of the remaining Maute Group terrorists and the civilians who died from atrocities committed by the lawless elements. This was bared by the Armed Forces Spokesman Brig. Gen. Restituto Padilla, in a statement on Monday. “Other agencies of the government were also requested to fly their flags at half staff tomorrow [Tuesday], the first official working day of the week,” he said. This is in addition to the observance of a Day of Silence and Prayer for the fallen troops and civilians that started on Sunday and will end on Monday. “In addition to observing a Day of Silence and Prayer for our heroes and the innocents who died due to terrorist atrocities in Marawi, we also had a nationwide tribute in cooperation with all the major television and radio networks to all the fallen. Shortly after, we flew all flags in all military camps at half staff in salute,” he added. As of Monday afternoon, 58 government troops have been killed, and around 120 were wounded in the fighting, which is now entering its fourth week. Maute Group death toll is placed at 191. Thirteen of the recent losses were Marines who were killed in a major gun battle that lasted for some 14 hours,at barangay Lilot Madaya in Marawi City last Friday. The fighting started 3:30 a.m. and ended 5:00 p.m. of June 9. Around 40 were also reported wounded. PNA

Economy

A4 Tuesday, June 13, 2017 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

SRA: Slim chance for PHL to get addl US sugar quota By Jasper Emmanuel Y. Arcalas

T

@jearcalas

he Philippines is seeing slimmer chance of getting an additional sugar-import quota from Washington, after the latter settled its trade dispute with Mexico on the commodity.

Sugar Regulatory Adminisration (SRA) Chief Anna Rosario V. Paner told the BusinessMirror that chances for the Philippines to get an additional quota from the US “are not good” after Mexico secured a “right of first refusal” to supply any additional sugar needed by Washington. “What I read so far is that Mexico has right of first refusal on any increase in allocation. So, if Mexico says it can serve the increase, then the allocation will be Mexico’s,” she said in a recent interview. “But I have yet to see any formal announcement from the US,” Paner added. The US and Mexico have successfully struck a deal on June 6, settling years-long dispute over the trade of sugar between the two countries. Under the agreement, Mexico will increase the price of its raw sugar being sold at local mills by 0.05 cents per pound for raw sugar, and 2 cents per pound for refined sugar. Furthermore, the import cap on Mexico’s refined sugar was cut drastically from 53 percent to 30 percent, while increasing its raw

74,464.99 MT The quantity of sugar shipped by the Philippines to the US, filling more than half of the 136,201 MT allocated by Washington sugar volume to 70 percent. At the same time, the agreement lowered the level of purity at which Mexican sugar can be sold as refined sugar in the US. Mexico accepted the abovementioned modifications on their previous trade agreement on the condition that it will be granted a right of first refusal to supply 100 percent of any “additional need” for sugar identified by the US Department of Agriculture (USDA) after April 1 of each year. This means Mexico would always have the first right to fill any “demand for sugar in excess of the demand USDA had predicted for the crop year,” according to the US De-

partment of Commerce. The SRA has been monitoring the tensions between the US and Mexico over its trade agreement, as additional quota allocation could depend on the results of their longstanding trade talks. Earlier, Paner said she will try to get additional allocation from Washington for the next crop year, as the Philippines has already front-loaded its shipments to the US. “I will try to work on a higher quota for the coming cropping season. The early shipment of sugar signifies that our production is capable of filling the quota,” she said. “I will try to work on a higher quota for the coming cropping season. The early shipment of sugar signifies that our production is capable of filling the quota,” she said. The Philippines exports sugar to the US under the tariff-rate quota (TRQ) scheme. The TRQ allows countries to export specified quantities of a product to the US at a relatively low tariff. Latest SRA data showed that, as of May 7, the country has already shipped 74,464.99 metric tons (MT) of sugar to the US, filling more than half of the 136,201 MT allocated by Washington. Paner said she expects local sugar exporters to ship the remaining volume to the US by June. Last year Manila was granted an additional quota of 12,194 MT out of the 86,533 MT reallocated volume from countries unable to fill the raw sugar TRQ given by Washington. The Philippines was given the

third-highest additional quota after Dominican Republic and Brazil, which were given 15,897 MT and 13,097 MT additional quota, respectively. However, sugar traders had a hard time in supplying the additional quota given by Washington in the previous crop year as exporting the additional volume would be too costly on their part. Philippine sugar production as of May 28 has already reached 2.333 MMT, surpassing both the government’s projection and the output in the previous crop year, SRA data showed. Preliminary data from the SRA, a government-owned and -controlled corporation attached to the Department of Agriculture, showed that sugar production has reached 46.667 million of 50-kilogram (kg) bags or 2.333 MMT. The figure is 4.24 percent higher than the 2.238 MMT produced in the previous crop year. It is also 3.68 percent higher than the SRA’s projection of 2.25 MMT. For the current crop year, the SRA allocated 74 percent of the local sugar output for domestic demand, while 20 percent would be exported to other world markets aside from the US. The remaining 6 percent of the total output would be responsible in filling Manila’s quota to Washington. Paner said there’s no need anymore to change the output allocation as the current crop year nears its end. The SRA pegged the domestic sugar demand for the current crop year at 2.15 MMT.

Neda told to fast track OK of water-supply infra projects

M

etropolitan Waterworks and Sewerage System (MWSS) Administrator Reynaldo V. Velasco urged the National Economic Development Authority (Neda) to fast track the approval of MWSS projects in the pipeline so that the agency can ensure it can carry out its mission of water security in supplying water for 25 million Metro Manilans that is sufficient, safe and continuous for personal and domestic uses. Velasco made the call in his welcome remarks during the 61st Project Implementation Officers’ Meeting hosted by MWSS on Thursday last week. He also expressed the need for the creation of a new technical working group with members coming from MWSS, the three concessionaries—Manila Water, Maynilad and Luzon Water Development—that will be responsible for the planning, implementation and assessment of doable projects in the next five, 10 or even 20 years. For his part, Neda Undersecretary Rolando Tungpalan lauded MWSS under Velasco for the agency’s clear- cut vision and goal in achieving a sustainable water security infrastructure and framework for Metro Manila and its other coverage areas. Velasco remarked that only Kaliwa Dam out of the two flagship dam projects proposed by MWSS under the New Centennial Water Project, has been approved by Neda early this year with a $10.8-billion official development assistance (ODA) from China. The MWSS chief emphasized that the joint implementation of K a l iwa a nd L a iba n d a ms, along with ongoing water source projects being undertaken by its concessionaires and the possible rehabilitation of Wawa Dam, altogether will yield an additional 3,500 million liters per day (MLD) to complement the 4,000 MLD from Angat Dam, which actually

Freedom to be employed Jobseekers brave the noontime heat and flock to the Rizal Park on Monday not only to join the annual commemoration of the country’s Independence Day, but also to try their luck in finding jobs. Roy Domingo

supplies 95.6 percent of the watersupply needs of Metro Manila and other nearby provinces. “With these new water sources, MWSS will ensure adequate, steady and sustainable water supply for our consumers in Metro Manila and adjoining provinces in the next 10 to 25 years, even 50 years—which shall form part of our collective legacy as public servants to future generations of

Filipinos,” Velasco added. Updates on the MWSS-Implemented Angat Water Transmission Improvement Project were among the topics taken up during the meeting. Also discussed were the Flagship Infrastructure Projects that comprise the “Build, Build, Build” program of the Duterte administration with a total funding requirement of P8.44 trillion. The findings of the 2016 ODA

Portfolio Review was also among those taken up, as well as the 2017 Good Practice Awards aimed at encouraging agencies to “take stock of their performance in implementing programs and projects; recognize implementing agencies that developed good practices; and multiply benefits of such practices by allowing other implementing agencies to learn from them and adopt them.”

news@businessmirror.com.ph

DOE lists ‘ideal’ location for new power plants By Lenie Lectura

@llectura

T

he Department of Energy (DOE) has identified ideal locations all over the country where new power projects should be put up in line with the projected 43,765 megawatts (MW) of additional capacity needed in the country by 2040. “We have already indicated the ideal locations of the needed generation capacities after considering all the important factors,” Energy Secretary Alfonso G. Cusi said. For Luzon, the National Capital Region and Bicol region have been identified as ideal locations in which to put up new power plants. For the Visayas, ideal locations are in Cebu, Bohol and Samar. And for Mindanao, Zamboanga Sibugay, Sultan Kudarat and Agusan del Sur are the ideal sites. Of the 43,765 MW of additional capacity needed by 2040, baseload power plants will account for 25,265MW, midmerit plants by 14,500 MW and peaking plants by 4,000 MW. A base-load power plant provides continuous supply of electricity throughout the year with some minimum power-generation requirement. Midmerit plants supply the gap between base load and peaking plants, which operate during peak hours when there is high demand for electricity. Natural-gas plants

43,765 MW

The projected needed power capacity for PHL by 2040 are common examples of midmerit plants. The DOE is pursuing to develop technology-neutral energy sources in meeting the ideal proportion of 70-percent base load, 20-percentmidmerit and 10-percent peaking requirements for power generation. To provide for this growing demand, the total energy-supply requirement is seen to reach the level of 134.2 million tons of oil equivalent by 2040, from just 52.2 million tons of oil equivalent in 2016. Fossil-based sources will continue to get the lion’s share in the total supply mix. “We are determined to achieve the ideal and dependable 70-20-10 energy mix, through massive infrastructure development with the indispensable participation of the private sector. “The quest to explore and use local or indigenous sources of energy, like renewables, fossil fuels and alternative fuels, will continue as a matter of policy. And in this age of rapidly developing technology, we will even encourage the entry of clean, efficient and smart technologies in the market,” Cusi said.

DENR’s Cimatu orders biodiversity assessment trip to Coron, Palawan By Jonathan L. Mayuga @jonlmayuga

A

team of biodiversity experts from Manila w ill fly to Coron, Palawan, to conduct an assessment of its rich biodiversity ahead of the planned construction of a proposed multibillion-peso underwater themepark project in the area. In a telephone interview on Monday, Director Theresa Mundita S. Lim of the Department of Environment and Natural Resources Protected Areas and Wildlife Bureau (DENRPAWB) said the team will conduct a reconnaissance and gather secondary data targeting the site of the proposed underwater theme park being eyed in Coron. Environment Secretary Roy A. Cimatu issued the assessment order during a visit last week at the DENR Biodiversity Management Bureau (BMB) office at the Ninoy Aquino Parks and Wildlife Rescue Center, the first time that a DENR secretary ever visited to greet the bureau’s employees. The proposed project will be constructed in a 400-hectare area in Coron, Palawan, by the Coral World Park Undersea Resorts and the Viacom International Media Networks, according to the Department of Tourism (DOT). Proponents of the project are yet to entirely disclose the details of the project, eliciting outrage from environmental groups, which even launched an online petition last year to scrap the project altogether. “Within the next two weeks, upon the verbal instruction of DENR Secretary Roy Cimatu, we will fly to Palawan to conduct an initial assessment,” Lim told the BusinessMirror. Lim said the team will be composed of BMB personnel from Manila and Palawan, DENR field personnel from Palawan and Region 4B. “There will be marine biologists, scientists, and if possible, we will also invite experts from the University of the Philippines–Marine Science Institute [UP-MSI],” she said. Divers from BMB, Lim added, will join the team. “We are also coordinating with the Department of Tourism and the

Philippine Council for Sustainable Development [PCSD],” she said. Cimatu’s “marching orders, Lim said, was “to [determine] what we stand to lose in the area.” The DENR has yet to receive any application for environmental compliance certificate (ECC) and the Environmental Management Bureau (EMB) has not yet received any application from the proponents of the project. “We will try to access the new plan from the DOT because the proponents have already made a presentation to the DOT. But if the proponents will give us a copy of the plan, then it will be very much welcome,” she said. Lim said they have an idea of where the proponents of the project plan to construct the underwater-themed park based on an old plan they were able to secure last September. But this was changed because of stiff opposition by environmental groups. “What I know is, initially, they plan to build it in coastal and marine area. But because of the stiff opposition, the plan was changed. Now, I think they want to build it on land, plus a floating facility,” Lim said. “Whether they plan to construct it on land or in water, our team will be doing a biodiversity assessment. We will talk to the communities because social acceptability is part of requirement for any project,” she added. Lim said that, to do a fair and more accurate cost-benefit analysis, the DENR-BMB will need full disclosure of the proposed project. A cost-benefit analysis, she said, will take time, especially if the target area is huge and vast. “We need to inventory the corals and other marine life that will be affected by the project,” Lim added. In a news statement released through the DENR’s Strategic Communication and Initiative Division (SCID), Cimatu said the DENR, at all levels, including the PCSD, has not yet received any formal communication from any project proponent about the proposed building of a theme park in Coron, Palawan, and is trying to find out the specifics of the project while waiting for the formal receipt of the proposal.

AseanTuesday BusinessMirror

news@businessmirror.com.ph

6.3-magnitude quake hits off Indonesia’s Java Island

A

6.3-magnitude earthquake rocked off the south coast of Indonesia’s mostpopulated Java Island on Monday morning, the Indonesian Meteorological, Climatological and Geophysical Agency said. No casualties or damage have been reported so far. The quake struck at 6:15 Jakarta time. The epicenter was 179 kilometer southwest of West Java province’s Sukabumi City with a depth of 10 km under the sea. Indonesia’s National Disaster

Mitigation Agency said on its official twitter account that the quake was also felt in the country’s capital Jakarta more than 200 km north of the epicenter. The Indonesian Meteorological and Geophysics Agency said there was no potential for tsunami. The United States Geological Survey put the magnitude at 5.6 with a depth of 10 km. Indonesia sits on the so-called Pacific Ring of Fire where several tectonic plates meet, making it vulnerable to frequent earthquakes. PNA

Thailand to target Facebook

T

hai regulators plan to impose financial penalties on Facebook Inc. and other companies with video-sharing platforms, if they fail to swiftly remove what they deem to be illegal content. The new framework would give authorities the power to immediately demand the removal of offensive material without waiting for a court order, Colonel Natee Sukonrat, vice chairman of the National Broadcasting and Telecommunications Commission, said in an interview last Wednesday. Details will be released as early as this month, he said, and companies would have about

a month to comply. “I will not touch the service; I will touch the way you make money,” Natee said when asked about penalties if companies ignore the requests. “They have to play by the rules,” he added. “I think they will cooperate because they make a lot of money from Thailand.” Facebook said it regularly receives requests from governments to limit access to content on the Internet when they believe it violates their laws. In Thailand, it has previously restricted access to content alleged to have violated lese-majeste laws concerning the royal family. Bloomberg News

Editor: Max V. de Leon • Tuesday, June 13, 2017 A5

Singapore’s red-carpet welcome for robots is not without risk

S

ingapore is thinking of making life easy for robot advisers. It’s a good idea to let low-cost, algorithm-based wealth managers have their shot at upending the marketplace for financial advice. Clients, especially millennials, are reluctant to pay top-drawer fees for unappetizing returns. The robot-wallahs claim to do a more efficient job, more transparently. They deserve a chance to prove it.

Still, there are risks, and not all of them are equally obvious. In a recently released consultation paper, the Monetary Authority of Singapore (MAS) proposed freeing digital advisers from the requirement that, in order to manage retail money, they must have a minimum

five-year track record and S$1 billion ($723 million) in assets. Instead, they can obtain a license provided they have the technology and management expertise, and only recommend portfolios that are at least 80 percent in exchange-traded funds (ETFs). This pragmatic approach deserves

a thumbs up. Besides, the MAS has made it clear that it will hold advisers’ boards and senior managers responsible for back-testing algorithms, and making sure they aren’t tilted toward products that fetch advisers higher fees. The one risk that could still come back to bite is the false sense of calm inbuilt in the very asset class that digital advisers are expected to stick to ETF. Singapore is right to insist that digital advisers looking to use its proposed licensing framework use traditional ETFs. These plain vanilla products don’t use leverage to amplify gains, and rather than entering into derivative contracts to deliver the performance of an index, hold a basket of securities passively. This much protection may be enough when the VIX, investors’ preferred fear gauge, is at 10. But with ETFs continuing to wrest market share away from active investors, the next time the volatility index shoots past 30—like it did on a number of occasions between 1998 and 2002 and again during the 2008 financial crisis—ETF liquidity might

prove to be a mirage. That’s when a bunch of angry investors will want to sue their robot advisers. Problems are most likely to arise when ETFs are liquid but their underlying securities aren’t. Arbitrageurs who deal directly with ETF sponsors, and buy and sell fund units and their underlying securities to take advantage of price mismatches are shy, for instance, to buy illiquid corporate bonds. As a study published in February showed, market volatility can “severely reduce” the efficacy of the arbitrage mechanism just when mispricing is the highest. Singapore is in luck. From December 2018, open-ended mutual funds in the US, including ETFs, won’t be allowed to hold more than 15 percent of their net assets in securities that can’t be sold within seven days. Until a similar norm becomes a globally accepted code, any faith in ETFs’ safety will carry with it the underappreciated risk of an unanticipated liquidity drought. That shouldn’t stop Singapore from rolling out the red carpet for robot advisers, so long as the regulator has its eyes wide open. Bloomberg News

Philippine leader, focused on war on drug users, ignored rise of isis

I

t was classic bravado from the Philippines’s tough-guy president, Rodrigo Duterte. The Maute Group, a militant Islamic band fighting government troops near the southern Philippines city of Marawi last year, had asked for a cease-fire. The President rejected the overture. “They said that they will go down upon Marawi to burn the place,” Duterte recounted last December. “And I said, ‘Go ahead, do it.’” He got his wish. Hundreds of militants belonging to the Maute Group and its allies fighting under the black flag of the Islamic State of Iraq and Syria (ISIS), seized Marawi three weeks ago, leading to a battle with the Philippine armed forces and the biggest test yet of Duterte’s leadership during his tumultuous first year in office. A President who has focused on a deadly antidrug campaign that has claimed the lives of thousands of Filipinos seems to have been caught unprepared for a militant threat that has been festering in the south for years. “The government has largely been in denial about the growth of ISIS and affiliated groups,” said Zachary M. Abuza, a professor at the National War College in Washington who specializes in Southeast Asian security issues. “Duterte has been preoccupied with his campaign of gutting the rule of law by using police and other security forces for the extrajudicial killing of drug pushers.” Government forces have been unable to dislodge the militants despite deploying ground troops and bombing the city of 200,000 people from the air. More than 200 people have been killed, including 24 civilians, 58 soldiers and police officers, and at least 138 militants, according to the Philippine military. Tens of thousands of civilians have fled, and much of the city center lies in ruins. The military says it has cleared 90 percent of the city but that militants remain in three neighborhoods in the center, where the militants are mixed in with hundreds of civilians. Duterte has declared 60 days of martial law for the southern island of Mindanao, which includes Marawi and his hometown, Davao City. He has twice set deadlines for troops to retake Marawi, the country’s largest predominantly Muslim city, but each deadline has passed with the battle still raging. On Friday Brig. Gen. Restituto Padilla predicted that the government would retake Marawi by Monday, Philippines Independence Day. On Saturday 13 Philippine marines were killed in a clash with militants there. The militants’ seizure of the city, a bold attempt to establish an Islamic State (IS) caliphate in Southeast Asia, marks a significant advance for the Middle East-based terrorist group, as well as an apparent reordering of the militant threat in the southern Philippines. For the first time, it puts the Philippines on the map with failed states, such as Libya and Afghanistan, as places where

In this June 9 photo, evacuees stay at a crowded evacuation center on the outskirts of Marawi City. AP

The government has largely been in denial about the growth of ISIS and affiliated groups. Duterte has been preoccupied with his campaign of gutting the rule of law by using police and other security forces for the extrajudicial killing of drug pushers.” —Abuza IS allies have sought to seize territory for a caliphate, giving the group another regional flash point in its effort to spread its influence globally. The IS has urged fighters who cannot reach Syria to join the jihad in the Philippines instead, said Sidney Jones, director of the Institute for Policy Analysis of Conflict. Fighters from Indonesia, Malaysia, Chechnya, Yemen and Saudi Arabia were among those killed in the battle for Marawi.

Mindanao has long been a hotbed of insurgencies, with numerous armed groups operating outside government control. Until the siege at Marawi, the best-known internationally was Abu Sayyaf, an ostensibly Islami militant group that specialized in kidnapping for ransom, turning Southeast Asia into the world’s piracy capital, edging out the Horn of Africa. The Marawi siege also heralds the rise of Isnilon Hapilon, a longtime leader of Abu Sayyaf who had grown more ideologically minded over the years. Last year Hapilon, 51, was named by the IS as its emir in Southeast Asia. Previously based on the island of Basilan, he is on the Federal Bureau of Investigation’s list of most-wanted terrorists, and the United States has offered a $5-million reward for his capture. Various factions have come together behind Hapilon, notably the Maute Group, led by the brothers Omar and Abdullah Maute. Educated in the Middle East, the Mautes are based in the Marawi area and recently accepted Hapilon’s leadership as emir. The Mautes are believed responsible for bombing a market in Davao City last September that killed 15. Duterte is the first president from Mindanao, and he ran last year as the candidate who could bring peace to the region. The bombing of his hometown may have inspired his angry challenge to the Mautes last December. “It’s the usual Duterte brand of bravado,” said Roilo Golez, a former national security adviser to former President Gloria

Macapagal-Arroyo, who left office in 2010. “It’s a way of intimidating the opposition. It works most of the time.” It hasn’t with the Islamic in Mindanao. After a clash between his military and Abu Sayyaf in April, Duterte suggested that the way to stop the militants was to eat them. “Make me mad,” he taunted. “Get me a terrorist. Give me salt and vinegar. I will eat his liver.” In May the Philippine military got a tip that Hapilon had arrived in Marawi to join up with the Maute brothers. When soldiers raided the house where Hapilon was believed to be, hoping to capture him and claim the $5-million reward, they were surprised to find dozens of well-armed militants arrayed against them. A video later recovered by the military and published by The Associated Press shows the militant leaders plotting their takeover of Marawi days before the military learned of Hapilon’s presence there. Hundreds of fighters who had gathered in preparation for seizing the city quickly put their plan into effect, burning schools and churches, taking hostages and taking over central Marawi. Duterte’s declaration of martial law helped lead to the capture of Cayamora Maute, the father of the Maute brothers, along with other family members last Tuesday at a military checkpoint in Davao City. Some fear that the temporary martial law order in Mindanao could be expanded nationwide, an idea Duterte has openly toyed with so that he could use the military in his antidrug campaign.

“There is a sense of dread and fear that this will build support for martial law,” said Richard Javad Heydarian, a political analyst and author of the forthcoming book Duterte’s Rise. “This could strengthen the feeling of isolation by the Muslim minority.” Muslims make up only about 5 percent of the country’s population overall but a larger proportion, estimated at 20 percent to 40 percent, on Mindanao. Historic grievances among the Muslim Moro people there, widespread poverty and large lawless areas have helped create an opportunity for the IS. A peace process pursued by Duterte’s predecessor, President Benigno S. Aquino III, faltered in 2015 and has remained deadlocked under Duterte. “It was not the spread of ISIS in Iraq and Syria that fueled ISIS cells in the Philippines, but the collapse of the peace process,” said Abuza, the National War College professor. The growing threat in the South will most likely compel Duterte to improve his relations with the United States, a process that had already begun with the election of President Donald J. Trump. Duterte has raged against the US for daring to criticize his antidrug campaign and, when President Barack Obama was in office, called for a “separation” from Washington. But Trump has shown a willingness to overlook the killings and has praised Duterte for doing an “unbelievable job on the drug problem”. Leaders of the Philippines armed forces prevailed on Duterte not to reduce military cooperation, including a long-standing US program to provide training, equipment and intelligence to fight terrorism. Since 2001, the US has maintained a rotating force of 50 to 100 troops in the southern Philippines to combat Abu Sayyaf. Last Sunday, Duterte said he never asked the US for help in Marawi, and it was a surprise to him when US Special Forces arrived to assist the Philippine military. The US Embassy said last Friday that US personnel were helping as part of a military relationship with the Philippines that “remains robust and multifaceted”. Emma Nagy, a spokesman for the embassy in Manila, said, “US Special Forces have been providing support and assistance in the southern Philippines for many years, at the request of several different Filipino administrations.” Whether the military can retake Marawi by its new deadline, the rebellion in the South is far from over. The audacity of the rebel takeover, even if it ultimately fails, will probably draw recruits from across the region, including members of other Islamist groups still disaffected and dissatisfied with a moribund peace process. “If Duterte doesn’t deal with that, then this whole problem is going to fester for a very long time,” Abuza said. The “ungoverned space” on Mindanao, he said, “is a regional security threat, not just a Philippine security threat.” New York Times News Service

A6

Tuesday, June 13, 2017

The World BusinessMirror

Macron on track to claim majority in parliament

P

ARIS—French voters resoundingly embraced the still-untested party of the newly elected president, Emmanuel Macron, in Sunday’s first round of parliamentary elections, dealing another humiliating blow to France’s traditional parties. Based on returns from 97 percent of France’s 577 districts, it appeared likely that candidates for Macron’s party, La République en Marche, would receive 28 percent of the votes for the National Assembly, the powerful lower house of Parliament, meaning that it appears on track to win a majority of seats, according to the Interior Ministry web site. T h e p a r t y ’s c o m m a n d i n g lead in t he f irst rou nd of voti ng completes a re m a rk a ble 14 mont hs in wh ic h Macron formed his ow n part y, humbled France’s main Socialist and Republ ica n pa r t ies a nd repel led t he fa r-r ight c ha l lenge of Mar ine L e Pen’s Nat iona l Front at a t ime of r ising r ight-w ing nat iona l ism a nd popu l ism. With an apparent majority in Parliament, the 39-year-old president will be in a strong position to enact his pro-business agenda—a lthough nothing is certain until next week ’s secondround vote. “Fra nce is bac k ,” Edou a rd Philippe, the prime minister for Macron, said after the strong vote for the president’s party, though he lamented the relatively light turnout, about 49 percent of the voting public, according to the Interior Ministry. “Despite the abstention, the message of the French has no ambig uit y: For the third consecutive time, mil lions of you con f i r me d y ou r at t a c h me nt to the president of the repub l ic’s projec t to renew, u n ite and w in back,” said Philippe, whom Macron brought in from

28%

The estimated percentage of votes France President Emmanuel Macron’s party would receive for the National Assembly

the mainstream, r ight-leaning Republican Par t y. Those candidates garnering 50 percent or more of the votes in their districts will be declared the winners. But given the large number of candidates for each seat and the low turnout, most of the top vote-getters will face a runoff next Sunday. To claim a majority in Parliament, candidates suppor ting Macron will need to win at least 289 seats. Failing that, he has formed an alliance with the centrist Democratic Movement to help ensure a majority. H o w e v e r, a s t h i n g s n o w stand, it appears all but certain that the president w il l have a m ajor it y— a nd pote nt i a l ly a large one. Parties on the extreme r ight and left seemed to be far ing poorly, gaining far fewer votes nationwide than they had in the first round of the presidentia l election, on Apr il 23. Retur ns showed that the National Front wou ld ta ke about 13.5 percent

French President Emmanuel Macron waves to the audience as he leaves a polling station in Le Touquet, northern France, after casting his vote in the first round of the two-stage legislative elections, on June 11. AP/Thibault Camus

of t he vote, wh i le Jea n-Luc Mélenchon’s leftist France Unbowed Par t y was ex pected to w in just 11 percent. At the same time, the traditional parties on the left and the right have been weakened, with the Socialists looking particularly feeble. Having controlled Parliament for the last five years, the Socialists were expected to win just 7.4 percent of the vote in the legislative elections this year. The Republicans and their allies fared better, but with just shy of 22 percent of the vote, they were a distant second to Macron’s. Other parties’ leaders blamed the historically low turnout for their poor showing and said it masked the depth of the divisions in France’s political landscape. “Today, one in every two French people voted, a record abstention rate not seen since 1958,” said Franois Baroin, a senior Republican official. “This testifies to persistent fractures in French society.” Baroin suggested that voters were so enamored of Macron that they failed to scrutinize his program. “The French need to know that En Marche wants a fiscal shock,” he said, adding that the Republicans would fight efforts to raise taxes. Many of Le Pen’s and Mélenchon’s voters—both have

heavily working-class and pinkcollar constituencies—did not go to the polls, suggesting that many will not be represented in the National Assembly. Because of differences between the districts, nationwide vote totals do not translate into a set number of seats in Parliament. There are frequently runoffs with two, three or four candidates, since anyone taking more than 12.5 percent of the eligible votes in a district can compete in the second round. O vera l l, however, t he legislative elections engendered less enthusiasm than the presidentia l elections a few weeks ago and legislative elections in recent years. Turnout this year was lower than in the past two legislative elections, 57 percent in 2012 and 60 percent in 2007. W hatever the outcome, a nation that a year ago seemed to be on the verge of being swept up in an anti-European, antiimmigrant wave has instead rallied behind Macron, a centrist and unabashed globalist who has called for weakening France’s protective labor laws, changing tax laws and reducing retirement benefits for some workers. New York Times News Service

www.businessmirror.com.ph

Is Israel the Jewish state? Not, according to its own laws

F

or years, Prime Minister Benjamin Netanyahu has argued that a key obstacle to peace is the Palestinian refusal to recognize Israel as the nationstate of the Jewish people. There’s only one problem: Netanyahu hasn’t even gotten his own government to define the state that way. Now, a bill enshrining Israel’s Jewish character in law has passed a tense, preliminary parliament vote, in which three Arab Knesset members had to be escorted out of the hall. Avi Dichter, chairman of the Foreign Affairs and Defense Committee, has been pushing the bill as a basic law since 2011, but it may face an uphill battle in parliament. “Netanyahu says time and again the Palestinians must recognize Israel as a Jewish state,” Dichter said in an interview from his Knesset office. “But you cannot pressure them to recognize Israel as a Jewish state when you yourself haven’t done it.” The bill, which defines the State of Israel as the “national home of the Jewish people”, is controversial among the country’s Arab citizens, who make up about 20 percent of the population. It also could anger Palestinians, just as US President Donald J. Trump seeks to reignite the peace process.

Palestinian complaints

Palestinian Authority (PA) officials refuse Netanyahu’s demand to recognize Israel as the Jewish state as part of peace talks, saying it’s not their responsibility to decide Israel ’s basic character. But PA President Mahmoud Abbas also objects to Dichter’s bill, which Palestinians believe could be used to deny the “right of return” to Israel they demand for millions of A rab refugees and their descendants. Israeli Arabs and some liberal Jews warn the bill would relegate non-Jews to second-class status. Arabic would no longer be considered a national language alongside Hebrew, though it would still enjoy a special status under Dichter’s proposal. Liberals fear Israel’s conservative government increasingly is taking steps to prioritize the state’s Jewish character over its democratic one. “This extreme-right government is trying to spread a fire of nationalist hatred, but I still be-

lieve there’s a majority here that wants to live in peace,” said Ayman Odeh, head of the Joint List, an alliance of Arab-dominated parties in the parliament. “Instead of acting to build a collaborative future for all, the government is acting to destroy the status of the Arab population and to exclude their culture.”

Basic laws

Israel’s declaration of independence mentions the country’s Jewish character more than a dozen times. Lacking a Constitution, Israel has 11 basic laws that underpin its legal system, touching on everything from Jerusalem to parliament to democracy, but they don’t clearly articulate the state’s Jewish character. That’s why supporters say Dichter’s bill is necessary: Among other things, the bill would reiterate the Jewish people’s connection to the state. The biggest problem with the bill is that it would force the Supreme Court to place Israel’s Jewish character above other considerations, according to Yedidia Stern, vice president for research at the Israel Democracy Institute. The bill would be more palatable if amended to stress Israel’s Jewish character in conjunction with equality for all citizens, he said. “This might be the most important piece of legislation among all Israeli laws, because it gives the judges eyeglasses and tells them to view everything in light of this law,” Stern said. That’s a key reason opposition politicians reject the bill. Yair Lapid, head of the Yesh Atid party, said he’ll vote against the bill even though he wants to bolster the country’s identity as a Jewish state. Lapid supports an alternative version he said “is not insulting to the Arab citizens of Israel and is not considered to be a conflict-seeking bill”. And religious parties may seek to block the bill unless it’s part of a broader political deal, Dichter said, citing conversations with ultra-Orthodox parliamentarians. The bill’s supporters says opposition parties simply want to thwart the government’s agenda. At a Cabinet meeting in late May, Netanyahu called to accelerate the legislation’s passage, saying “there is no contradiction at all between this bill and equal rights for all citizens of Israel”. Bloomberg News

Trump lawyer amasses clout in White House

M

arc E. K asowitz, a New York civil litigator who represented President Donald J. Trump for 15 years in business and boasts of being called the toughest lawyer on Wall Street, has suddenly become the field marshal for a White House under siege. He is a personal lawyer for the president, not a government employee, but he has been talking about establishing an office in the White House complex where he can run his legal defense. His visits to the White House have raised questions about the blurry line between public and private interests for a president facing legal issues. In recent days Kasowitz has advised White House aides to discuss the inquiry into Russia’s interference in last year’s election as little as possible, two people involved said. He told aides gathered in one meeting who had asked whether it was time to hire private lawyers that it was not yet necessary, according to another person with direct knowledge. Such conversations between a private lawyer for the president and the government employees who work for his client are highly unusual, according to veterans of previous administrations.

Kasowitz bypassed the White House Counsel’s Office in having these discussions, according to one person familiar with the talks, who like others requested anonymity to discuss internal matters. And concerns about Kasowitz’s role led at least two prominent Washington lawyers to turn down offers to join the White House staff. “The president’s private lawyer is representing only his interests, not the interests of the United States government or the individual interests of the White House staff,” said Robert F. Bauer, who was White House counsel under President Barack Obama. The administration referred questions to Kasowitz. A spokesman for K asow itz ca l led the characterizations of his conversations with staff members “inaccurate”, but would not specify how. “The lawyers don’t disclose conversations they have had with anyone,” Mark Corallo, the spokesman, wrote in an e-mail. “Of course, people are free to hire a lawyer or talk to anyone they want.” K a sow it z i s not t he f i rst persona l law yer to represent a president facing lega l issues. President Bill Clinton retained Rober t S. Bennett to defend h i m i n a se x u a l-h a ra ssment

lawsuit filed by Pau la Jones, and David E. Kendall and Nicole K. Seligman to represent him in the W hitewater and Monica S. Lew insk y investigations. The line between government lawyers representing the administration and private law yers representing the president was always somewhat vague. But one important difference was that the president’s conversations with private lawyers were protected by attorney-client privilege, while those with his White House lawyers were not. To many Washington hands, Kasowitz, 64—who represented Trump during his Atlantic City casino financial troubles and represents other clients like Bill O’Reilly, the former Fox News host—seems an unusual choice for the mission. W hile he is widely respected as a fierce and successful lawyer, he has little experience in high-profile criminal cases or politically charged Washington investigations. Kasowitz has been central to Trump’s recent legal battles, helping his client keep divorce records sealed and representing him in the Trump University fraud lawsuit, in which Trump ultimately agreed to pay $25 million to settle claims from former students that

the institution had cheated them out of tuition money. In the final weeks of the president ia l ca mpa ig n, K asow it z threatened to sue The New York Times for libel on Trump’s behalf over a story in which two women accused Trump of inappropriate touching years earlier. No lawsuit has been filed. A decade earlier, however, Kasowitz followed through on a similar threat, suing Timothy O’Brien, a Trump biographer and former reporter and editor for The Times, for libel and alleging that he had understated Trump’s net worth. That suit was dismissed by a New Jersey Superior Court judge. Also raising eyebrows are two of K asow itz’s other clients— Sberba n k , t he l a rgest st ate owned bank in Russia, on which the Obama administration imposed sanctions, and Oleg Deripaska, a Russian tycoon who is close to President Vladimir Putin and had business dealings with Paul Manafort, once Trump’s campaign chairman. While Trump is not known to be under investigation over potential collusion with Russia, the special counsel leading the Russia inquiry, Robert S. Mueller III, has the authority to investigate obstruction of justice.

Marc Kasowitz, President Donald J. Trump’s private lawyer, speaks at the National Press Club, following former Federal Bureau of Investigation Director James Comey’s Senate testimony, in Washington on June 8. Kasowitz has counseled administration staff and exerted broader influence over legal strategy. Justin T. Gellerson/The New York Times

Some in Congress have said that Trump’s firing of Federal Bureau of Investigation Director James Comey coupled with his own statements about Comey, could be seen as evidence of attempted obstruction of justice. W hether Kasowitz is having an effect on his client is unclear. He advised Trump to ease up on his use of Twitter, and when

Trump’s account was quiet for nearly 48 hours last week around t he t i me of Come y ’s Sen ate hearing, some speculated that Kasowitz was responsible. But Trump began attacking Comey’s testimony last Friday morning, and he has defiantly told friends that despite his lawyer’s instructions, he has not changed his behavior. New York Times News Service

www.businessmirror.com.ph

The World BusinessMirror

Republicans urge Trump on tapes

W

ASHINGTON—Fellow Republicans pressed President Donald J. Trump last Sunday to come clean about whether he has tapes of private conversations with former Federal Bureau of Investigation (FBI) Director James Comey and provide them to Congress if he does—or possibly face a subpoena, as a Senate investigation into collusion with Russia or obstruction of justice extended to a Trump Cabinet member. It was a sign of escalating fallout from riveting testimony from Comey last week of undue pressure from Trump, which drew an angry response from the president last Friday that Comey was lying. Attorney General Jeff Sessions was in for sharp questioning by senators on the Senate Intelligence committee on Tuesday. Whether that hearing will be public or closed is not yet known. “I don’t understand why the president just doesn’t clear this matter up once and for all,” said Sen. Susan Collins, RepublicanMaine, a member of that committee, referring to the existence of any recordings. She described Comey’s testimony as “candid” and “thorough” and said she would support a subpoena if needed. Trump “should voluntarily turn them over”, Collins said. Sen. James Lankford, Republican-Oklahoma, also a member of that committee, agreed the panel needed to hear any tapes that exist. “We’ve obviously pressed the White House,” he said. Trump’s aides have dodged questions about whether conversations relevant to the Russia investigation have been recorded, and so has the president. Pressed on the issue last Friday, Trump said “I’ll tell you about that maybe sometime in the very near future.” Lankford said Sessions’s testimony on Tuesday will help flesh out the truth of Comey’s allegations, including Sessions’s presence at the White House in February when Trump asked to speak to Comey alone. Comey alleges that Trump then privately asked him to drop a probe into former national security adviser Michael Flynn’s contacts with Russia. Comey also has said Sessions did not respond when he complained he didn’t “want to get time alone with the president again”. T he Justice Depar tment has denied that, saying Sessions stressed to Comey the need to be careful about following appropriate policies. “We want to be able to get his side of it,” Lankford said. Sen. Jack Reed, DemocratRhode Island, said “there’s a real question of the propriety” of Sessions’s involvement in Comey’s dismissal, because Sessions had stepped aside from the federal investigation into contacts between Russia and the Trump campaign. Comey was leading that probe. Reed said he also wants to know if Sessions had more meetings with Russian officials as a Trump campaign adviser than have been disclosed. Trump on Sunday accused Comey of “cowardly” leaks and predicted many more from him. “Totally illegal?” he asked in a tweet. “Very ‘cowardly!’” Several Republican lawmakers also criticized Comey for disclosing memos he had written in the aftermath of his private conversations with Trump, calling that action “inappropriate”. But, added Lankford “releasing his memos is not damaging to

national security”. The New York City federal prosecutor, who expected to remain on the job when Trump took office but ended up being fired, said he was made uncomfortable by one-on-one interactions with the president—just like Comey was. Preet Bharara told ABC’s This Week that Trump was trying to “cultivate some kind of relationship” with him when he called him twice before the inauguration to “shoot the breeze”. He said Trump reached out to him again after the inauguration but he refused to call back, shortly before he was fired. O n Come y ’s acc u s at ion s that Trump pressed him to drop the FBI investigation of Flynn, Bharara said “no one knows right now whether there is a provable case of obstruction” of justice. But: “I think there’s absolutely evidence to begin a case.” D e mo c r at ic S e n . D i a n ne Feinstein of California, a member of the Intelligence committee, sent a letter to Sen. Chuck Gr a s s le y, R e pu bl ic a n - Iow a , urging him to investigate possible obst r uct ion of just ice by Trump in Grassley’s position as chairman of the Judiciary Committee. Feinstein is the top Democrat on that panel and a member of both. She said Sessions should also testif y before the Judiciar y Committee, because it was better suited to explore legal questions of possible obstruction. Feinstein said she was especially concerned after National Intelligence Director Dan Coats and National Security Agency Director Michael Rogers refused to answer questions from the intelligence committee about possible undue influence by Trump. Feinstein said she did not necessarily believe Trump was unfit for office, as House Democratic leader Nancy Pelosi has asserted, but said he has a “destabilizing effect” on government. “ There’s an unpredictability. He projects an instability,” Feinstein said. “Doing policy by tweets is really a shakeup for us, because there’s no justification presented.” In ot her appea ra nces on Sunday: n Senate Democratic leader Chuck Schumer of New York said he would take Trump up on his offer to testify under oath about his conversations with Comey, inviting the president to testify before the Senate. n Feinstein acknowledged she “would have a queasy feeling, too” if Comey’s testimony was true that Loretta Lynch, as President Barack Obama’s attorney general, had directed him to describe the FBI probe into Hillary Clinton’s e-mail practices as merely a “matter” and to avoid calling it an investigation. Feinstein said the Judiciar y Committee should investigate. n Sessions stepped aside in March from the federal investigation into contacts between Russia and the campaign after acknowledging that had met twice last year with the Russian ambassador to the US. He had told lawmakers at his January confirmation hearing that he had not met with Russians during the campaign. Sessions has been dogged by questions about possible additional encounters with the ambassador, Sergey Kislyak. As for the timing of Sessions’ recusal, Comey said the FBI expected the attorney general to take himself out of the matters under investigation weeks before he actually did. AP

Tuesday, June 13, 2017

A7

Oil extends gains as Saudis see global supply drop accelerating

O

il extended gains as Saudi Arabia and Russia sought to reassure investors that coordinated production cuts by Organization of Petroleum Exporting Countries (Opec) and its partners are draining a global glut.

Futures rose as much as 0.7 percent in New York after climbing 0.4 percent last Friday. Inventories are declining and reductions will accelerate in the next three to four months, Saudi Arabia’s Energy Minister Khalid Al-Falih said at a briefing in Kazakhstan with his Russian counterpart, Alexander Novak. Russia is committed to doing ever ything it can to balance the market, Novak said. Oil is trading below $50 a barrel, amid speculation increased US supplies will counter production curbs by the Opec and its allies, including nonmember Russia. American drillers targeting crude added rigs for the 21st straight week, the longest run of gains in three decades, accord-

$45.83

The price of oil per barrel when prices increased by 19 cents last Friday

ing to data last Friday from Baker Hughes Inc. “Global stockpiles are coming down steadily, it’s just that it has started from a very high level,” said Gordon Kwan, a Hong Kong-based analyst at Nomura Holdings Inc. “Opec doesn’t need to expand the size of production cuts because the last thing they want is a

Oil pumps

Bloomberg News

big, unsustainable gain in prices.” West Texas Intermediate (WTI) for July delivery rose as much as 32 cents to $46.15 a barrel on the New York Mercantile Exchange and traded at $46.08 at 1:19 p.m. in Hong Kong. Total volume traded was about 5 percent above the 100-day average. Prices increased 19 cents to close at $45.83 last Friday, trimming the weekly decline to 3.8 percent. Brent for August settlement climbed as much as 36 cents, or 0.8 percent, to $48.51 a barrel on the London-based ICE Futures Europe exchange. Prices lost 3.6 percent last week. The global benchmark crude traded at a premium of $2.10 to August WTI.

G l o b a l c r u d e i n v e nt o r i e s w i l l sett le at t heir f ive-year historical average—Opec’s target—before the end of the year, A l-Fa lih said in A stana. Stil l Saudi A rabia, the group’s biggest producer, may modif y its policy if output cuts don’t have the desired effect, he added. Meanwhile, US drillers increased the rig count by eight to 741, the highest level since April 2015, according to Baker Hughes. At the same time, Qatar, the focus of a diplomatic dispute with Saudi Arabia, is committed to production cuts under the Opec-led agreement, according to Qatari Energy Minister Mohammed Al Sada. Bloomberg News

Preparing for Brexit, Britons face economic pinch at home

L

ONDON—Right about now, Eddie Stamton, a construction worker, would normally be making preparations to jet off to a sandy stretch of the Mediterranean for a summer holiday. Not this year. In the year since Britain’s shocking vote to abandon the European Union, the British pound has surrendered 13 percent of its value against the euro, raising the cost of cherished European vacations. Food from other lands—meat, cheese, wine—is more expensive, too. So is gasoline. Accelerating inf lation may help explain the stunning electoral rebuke of Prime Minister Theresa May and her governing Conservative Party, as well as the unexpected strengthening of the Labour Party in Thursday’s parliamentary elections. Consumers are grappling with rising prices, and wages have not kept pace. The economy is weakening. Stamton, 51, who lives in northeast London, has traditionally voted for the Conservatives, yet this time he gave his support to the UK Independence Party, the fringe party that has long advocated that Britain ditch Europe. Never mind that the consequences of that position, the falling pound, have yielded the indignity at hand—trading the sun-splashed beaches of Greece for the shaded parks of south London. “ Travel is more expensive,” Stamton said. “I’m just going to stay home.” Here is the economic backdrop for the tumultuous period of political uncertainty now unfolding. May and her party have lost their governing majority just as Britain is set to negotiate terms in its tricky divorce with Europe— Brexit, as it is widely known. As the Conservatives try to hang on to control of the government, a weakening economy is likely to intensify the sense of grievance among ordinary Britons who have not gained the spoils from recent years of growth. The economy expanded only 0.2 percent during the first three months of the year compared with the previous quarter, far less than the 0.7 percent pace of growth seen at the end of 2016. It grew at an

Britain’s Prime Minister Theresa May and her husband Philip leave after attending Holy Communion at Saint Andrew’s Church in Sonning, Berkshire, England, on June 11. May is under pressure after the Conservatives lost their parliamentary majority in Thursday’s election. Jonathan Brady/PA Wire via AP

annualized pace of 2 percent during the quarter. Consumer spending makes up nearly two-thirds of British economic activity, meaning the troubles of ordinary people can have decisive influence over the economy—and politics, for that matter. For the average worker, rising prices for everyday consumer goods are landing atop a decade of stagnating wages. Few economists expect that Britain will fall into a recession, but t he consensus env isions disappointing economic growth ranging between 1.5 percent and 1.75 percent annually during this year and next. Last year’s Brexit referendum was in part a rejection of the economic elite from millions of working people who have suffered dec lining wages, whi le watching London transformed into a carnival of wealth for globe-trotting financiers. The prime minister called for the elections on the strength of polls showing her party capturing an expanded parliamentar y m ajor it y, a i m i ng to sol id i f y her hand as she negotiates exit terms with Europe. But her miserable showing in Thursday’s polls suggest the same forces that produced Brexit have assailed the government that is supposed to execute it: Many Br itons are dissatisfied w ith their economic lot. In the dozen years since Vaidas Zelskis entered Britain from his native Lithuania to pursue work as

a carpenter, his wages have grown from about £120 a day, (about $224 dollars at the exchange rates of the time) to about £180 now. But over the same time, his usual assortment of groceries have soared from some 50 pounds per week to more like £120. “The rich people can always afford what they want,” Zelskis said as he took a cigarette break on a recent morning outside his job at the Shard, an iconic skyscraper south of the River Thames. “But the middle class really feels it.” Much as in the United States, most working people in Britain have yet to fully recover from the traumatic financial crisis that began in 2008. Britain’s average weekly wages are lower today than they were a decade ago after accounting for inflation, noted Martin Beck, lead British economist at Oxford Economics in London. This, despite the fact that Britain’s unemployment rate dropped to 4.6 percent in April, a level last seen in 1975. “For most people, there hasn’t been a real recovery for years,” Beck said. I n ye a rs pa st , low u nemployment has tended to push up wages, as employers found themselves forced to pay more to compete for a smaller pool of workers. W hy this typically enriching dynamic has failed to emerge now is the subject of considerable debate among economists. Unions are far weaker than years ago. The gig economy has replaced full-time jobs with

part-time and temporary stints, diluting the power of workers to demand higher pay. A surfeit of global uncertainties—Brexit, President Donald J. Trump’s threats to dismantle institutions at the heart of the global order—have perhaps made companies reluctant to add costs. The weaker pound has given a boost to British exports, making them lower priced than European and American competitors. British whiskey, salmon and chocolate have been selling in increasing volumes. But Britain imports more food than it exports. Many of the country’s key export industries—automotive, aerospace and medical devices—draw on suppliers in Europe for components. Even as the weak pound makes the prices of their finished wares more competitive, it also raises their costs. The economy also faces the loss of top-dollar banking jobs as London’s status as a leading international financial center confronts the challenges posed by Brexit. Roughly one-third of the industry’s business involves handling transactions for clients in Europe. Once Britain is out of the European Union, much of that business may be effectively illegal, requiring that banks satisfy the proclivities of regulators in the 27 remaining members of the bloc. The financial industr y has been lobbying the government to forge a deal with Europe that would maintain the status quo, enabling the money to keep flowing unimpeded. In weakening May’s stature, the election may have increased the chances she will soften her line and assent to compromises that would preserve Britain’s inclusion in the European market. Even so, global banks cannot afford to wait in the hopes that a useful deal will be struck. They are already drawing up plans to move jobs to cities elsewhere in the EU as they seek to ensure that—whatever comes—they will be able to execute all trades. Britain could suffer losses of 15,000 to 80,000 jobs over the next two years, according to studies. New York Times News Service

A8

The World BusinessMirror

Tuesday, June 13, 2017

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

Trump considers scrapping British visit after outcry over his Twitter comments

B

Gregory Elfers with the New York City Gay Men’s Chorus sings as he marches along Constitution Avenue North Western, United States, during the Equality March for Unity and Pride in Washington, on June 11. AP/Carolyn Kaster

Pride and anger at LGBT rights marches across US

W

ASHINGTON—Supporters of lesbian, gay, bisexual and transgender (LGBT) rights marched and rallied in the nation’s capital and dozens of other US cities last Sunday, celebrating gains but angry over threats posed by the administration of President Donald J. Trump. T he center piece e vent , t he E qu a l it y M a rc h i n Wa sh i ng ton, was endorsed by v ir t u a l ly ever y major nat iona l advocac y g roup work i ng on be h a l f of L GBT A mer ic a n s. Activists have been embittered by the Trump administration’s rollback of federal guidance advising school districts to let transgender students use the bathrooms and locker rooms of their choice. They also complain that Trump, who campaigned as a potential ally of gays and lesbians, has stocked his administration with foes of LGBT rights, including Vice President Mike Pence, Attorney General Jeff Sessions, and Health and Human Services Secretary Tom Price. Throngs of marchers, many thousands strong, paraded past the White House and toward the

100 The estimated number of lesbian, gay, bisexual and transgender marches and rallies across the US held last Sunday

Capitol, trailing behind a giant rainbow f lag near the head of the procession. “We’re here, we’re queer, get that Cheeto out of here,” was among the chants directed at Trump. For the LGBT community na-

tionwide, it’s an emotional time. Monday is the anniversary of the mass shooting a year ago in Orlando, Florida, that killed 49 people—mostly Latinos—at Pulse, a gay nightclub. Among the marchers in Washington was Gil Mendez, a Puerto Rican native who traveled with his partner all the way from San Francisco to join the parade. He carried a sign that included the names of all the Pulse victims. “The attack on Pulse really struck me hard,” he said. “It made the connection between the physical violence of guns and the political attacks on our community.” A lso marching, and singing f reedom songs a nd patr iot ic songs along the way, were scores of members of gay c hor uses from various cities. “It’s an opportunity to tell everyone we’re still here, and we’re not going away at all,” said Gregory Elfers of Teaneck, New Jersey, who was with a contingent from the New York City Gay Men’s Chorus. “We have to be heard—we have to be sure we’re not trampled on,” said L. Owen Taggart of Washington’s Gay Men’s Chorus. The roughly 100 marches and rallies across the US included the first-ever gay-pride parade in Grosse Pointe, a prosperous Detroit suburb. It began at Grosse Pointe South High School to emphasize support for teens

who are gay or transgender. Two 15-year-old marchers, Jessica Dodge and Shekinah Aho, held hands and wore shirts that said, “Make America Gay Again”. The Los Angeles pride parade was renamed the ResistMarch, and tens of thousands turned out in Hollywood, some carrying rainbow flags or signs reading “Love Trumps Hate”. Speakers included Mayor Eric Garcetti, US Reps. Adam Schiff, Maxine Waters and Nancy Pelosi and RuPaul, the host of “RuPaul’s Drag Race”. Waters led the crowd in a chant of “Impeach 45”. “We’re going to take our country back from him,” she said. “I know that you have the strength. I know that you have the courage. And I know that each of you understand you have the power.” Back in Washington, the activist leaders on hand included Sarah Kate Ellis, president of GLAAD, which monitors media coverage of the LGBT community. She noted that Trump, breaking from the practice of Barack Obama, has declined to issue a proclamation in honor of Pride Month, and that the Trump administration has deleted questions about sexual orientation from planned federal surveys. “If you look at their prioritization, we’re really low on it,” she said. “There absolutely is a resistance aspect to this march.” AP

Two Chinese provinces faked economic data, inspectors say

C

hina’s graft watchdog said it identified cases of fake economic data in two northern provinces, the second announcement this year about unreliable figures. Some areas and companies in Jilin and certain places in Inner Mongolia falsified reports, the Communist Party’s Central Commission for Discipline Inspection (CCDI) said in statements late last Sunday, without specifying what figures were manipulated,

how widespread the practice was, or the timeframe. CCDI also said it found violations in the use of funding for poverty relief. The accuracy of China’s statistics has been questioned in the past, as readings such as GDP growth or jobless rates showed uncanny stability, while provincial officials previously had incentives to inf late growth numbers to enhance their careers. L i aon i ng prov i nce, wh ic h

neighbors Jilin in the northeast, this year admitted faking fiscal data from 2011 to 2014. China’s National Bureau of Statistics, the nation’s top statistical agency, said in April that it established a new supervisory arm to ensure data authenticity and improve data quality. Jilin, which borders North Korea, expanded at the secondslowest pace of all provincial reg ions in t he f irst quar ter. Its total output is roughly half

that of Beijing. Inner Mongolia, w ith abundant coal and rare earth resources, also has less output than China’s capital. It reported an expansion faster than the national average in the Januar y-to-March period. Parts of northern China have struggled as economic growth decelerates, with the heav y-industrial base Liaoning reporting a mere 2.4-percent expansion after a recession last year. Bloomberg News

R A NCHBURG, New Jersey—President Donald J. Trump is considering scrapping or postponing a planned visit to Britain later this year amid a billowing backlash over comments he made after the recent terrorist attack in London, two administration officials said. Over the past week Trump has expressed increasing skepticism to aides about the trip after coming under intense criticism for a misleading charge that he leveled against London’s mayor, Sadiq Khan. A day after terrorists killed eight people in the British capital, Trump went after Khan on Twitter, saying the mayor had played down the danger to citizens in the wake of the assault. The White House briefly considered including the visit scheduled as part of a trip to Europe next month, but the idea was dropped because of scheduling issues. Then it was tentatively penciled in for the fall. Nat ion a l Sec u r it y Cou nc i l and State Department officials were working on the details but had not undertaken the usual “preadvance” trip to work out the specific logistics of joint appearances, said a person familiar with the situation. Trump, who was visiting his golf course in Bedminster, New Jersey, over the weekend, has not definitively ruled out going, the officials said. They emphasized that it was possible that the president would eventually warm to the idea, and that keeping it off the schedule was the best way to prepare for any eventuality. But he has told his staff that he wants to avoid a marathon overseas trip like his nine-day trek to the Middle East and Europe, which he found exhausting and overly long. One other factor leading to his

reluctance, said one of the officials, is his preference for having foreign leaders visit him—not the other way around. But optics and politics are major considerations, too. Trump is deeply unpopular in Britain, and any visit by him—let alone a state visit with all its pomp—would probably be met with wide-scale protests. Recent polls have found that more than half of the British public views Trump as a threat to global stability. At the same time, his poll numbers at home are hitting historic lows. The president has avoided trips to his home in New York City, in part because of the potential for disruptions, several people in his orbit have said. Trump has discussed the potential difficulties of a trip to Britain with Prime Minister Theresa May, who had a stunning setback in parliamentary elections on Thursday, although the subject of a visit was not raised when they spoke on the phone last week, the officials said. “The president has tremendous respect for Prime Minister May,” said Sarah Huckabee Sanders, a spokesman for Trump. “That subject never came up on the call.” May’s office, responding to a report in The Guardian that Trump did not want to visit Britain until he had more public support, issued a statement last Sunday, saying there had been “no change” to plans for a state visit. “We aren’t going to comment on speculation about the contents of private phone conversations,” a spokesman for May’s office said. “The queen extended an invitation to President Trump to visit the UK, and there is no change to those plans.” May extended the invitation to the president around the time of his inauguration. New York Times News Service

Melania Trump, son Barron move into the White House

W

A S H I N G T O N —T h e first family is together again under the same roof: the White House. After nearly five months of living apart, President Donald J. Trump’s wife, Melania, announced last Sunday that she and the couple’s young son have finally moved into the presidential mansion at 1600 Pennsylvania Avenue. Mother and son broke with tradition by living at Trump Tower in New York since the inauguration so that Barron, now 11, could finish the school year uninterrupted; the president lived and worked at the White House. “Looking forward to the memories we’ll make in our new home! #Movingday,” the first lady tweeted on Sunday evening after she and Barron arrived at the White House with Trump. The tweet accompanied a photo of the Washington Monument as seen from the White House Red Room. The president spent the weekend at his private golf club in Bedminster, New Jersey, and had said on several occasions that his wife and son would move to the White House after the school year. Trump celebrates his 71st birthday on Wednesday and got his gift a few days early. Mrs. Trump said last month that Barron will attend a private school in Maryland in the fall, an announcement that answered one of the lingering questions surrounding the Trump family’s unusual living arrangement. It also pointed toward a coming move to the White House. One remaining question had to do with a move-in date, and Mrs. Trump answered it last Sunday. Her spokesman, Stephanie Grisham, confirmed the move by e-mail and on Twitter. “It’s official! @FLOTUS & Barron have

made the move to DC! #WelcomeHome,” Grisham tweeted. Barron will enter the sixth grade at Sa i nt A nd re w ’s Epi scopa l School in Potomac, Maryland, in the fall. Trump has four older children—Don Jr., Ivanka, Eric and Tiffany—among his two exwives. Ivanka Trump has taken a White House job as an adviser to her father. Melania Trump stayed largely out of sight during her husband’s presidential campaign and was an absent first lady at the outset of the administration, staying in New York and focusing on Barron. But she has slowly been raising her profile at the White House, including joining the president when foreign leaders and their spouses visit, cohosting the annual Easter Egg Roll and holding some solo events. She recently accompanied the president on his first foreign trip, a nine-day journey through Saudi Arabia, Israel, Italy and Belgium that marked her first extended turn as first lady in the public spotlight. Now that’s she’s at the White House full time, pressure will build for her to be seen more and to do more. She said during the campaign that she would work on the issue of cyber bullying as first lady, but she has made no further announcements about the subject. She also has shown an interest in military veterans and empowering women and girls. “I do think once she’s in D.C., there’ll be more pressure for her to be working on something that’s her own that’s helping some segment of the population, because that’s what first ladies are supposed to do,” said Jean Harris, professor of political science and women’s studies at the University of Scranton in Pennsylvania. AP

The Regions BusinessMirror

news@businessmirror.com.ph

Editor: Efleda P. Campos • Tuesday, June 13, 2017

Islamic scholars, schools in ARMM mount counteroffensive vs extremism

D

By Manuel T. Cayon | Mindanao Bureau Chief @awimailbox

AVAO CITY—The country’s Islamic scholars, including the house of jurisprudence in the Autonomous Region in Muslim Mindanao (ARMM), publicly announced they were mounting a counter ideological warfare against terrorist organizations, a month after the ARMM hosted the first Ulama Summit in Cotabato City.

Both the Ulama Council of the Philippines and the Darul Ifta, or the Fatwa Council of the ARMM, said they “are waging an ideological war against the spread of radicalism and extremism through a holistic approach in the Islamic teaching”. “We are engaging all sectors to address the spread of religious extremism and radicalism in the countr y,” said Abdu lmuhmin Alyakanie Mujahid, the executive director of the ARMM Darul Ifta, or Islam’s house of jurisprudence. The Darul Ifta is the highest decision-making body of Islam in

matters relating to Islamic doctrine and principles. The ARMM’s Bureau of Public Information said last Thursday Islamic scholars in the island province of Basilan “forged several agreements with the regional and provincial governments, as well as with line agencies, to carry out multi-approaches to deny the spread of extremist ideology in their area”. Muhajid said the move was an offshoot of the Ulama summit in Cotabato City in early May, when the ulama issued a declaration against terrorism, saying “it is

haram, or forbidden and unlawful, to use Islam to justify or legitimize violent extremism and terrorism.” The ulama also challenged themselves “to reeducate [their] constituents to rediscover Islamic faith for justice, compassion, harmony and peace.” “It is imperative upon us all to cooperate and collaborate with the stakeholders in preventing and countering violent extremism and terrorism in its many forms and manifestations,” the declaration said. Days before the Ulama summit, the Islamic State-linked Dawla Islamiya also issued its warning against them and their families. “To those who have ulama relatives, warn your parents, brothers and children not to attend the said summit because if something happens to them along the way or in the end, don’t tell us you were not warned,” the Dawla Islamiya statement said. Mujahid said they were “engaging all stakeholders to overcome the challenges of extremism, as what is happening in Marawi City.” “These extremist groups are using the creed of Islam. As a matter of fact, they are using the so-called 13 doctrines of Islam and citing verses of the Holy Koran in justifying their criminal and inhumane acts. We cannot and will not allow that,” he said.

“Our call is to fight against violent extremism and terrorism,” Mujahid said. Also, the ARMM information office quoted one Alih Aiyub, secretary-general of the Ulama Council of the Philippines, as saying what they are employing “are multidisciplinary approaches in concretizing preventing violent extremism and countering violent extremism.” He said they have identified “seven interventions” to address the threat. “Ulama will handle the spiritual aspect to combat terrorism targeting the youth and winning the hearts and minds of those radicalized through sermons in the mosques and other means,” he added. The educational intervention includes working “with educational institutions to provide a primer or module, as reference material, and train teachers for effective prevention of violent extremism among their students,” Aiyub said. “Scholarships will also be provided on skills training for outof-school youth by tapping the Technical Education and Skills Development Authority [Tesda] as a partner,” he said. There would be psychological intervention, such as values formation to be carried out by local government units and the Department of Social Welfare and Development, targeting the youth sector.

“The program will also have a component for social intervention, which will help mold an individual to be productive and peaceful through trainings. This will also be implemented along with economic intervention, such as providing livelihood programs for the youth through government line agencies like the Department of Agriculture and Tesda,” Aiyub added. They would also engage with the security sector “to shield the youth from being recruited by extremist groups and to provide peace and security in the community,” Mujahid said. The program would be piloted in Basilan, he said. “We are going to implement it in the different parts of the region. We are piloting this initiative in Basilan. We would conduct an assessment and fine-tune it before implementing it in other provinces,” Mujahid added. ARMM Gov. Mujiv Hataman said he instructed the Department of the Interior and Local Government in the ARMM to initiate forums for local government officials across the region to understand the complexity of the problem and how to combat it. “When the masses, the religious leaders, and the political leaders are united to work together for the betterment of our society, we can succeed, Insha Allah,” he said.

Zambales ‘freedom camp’ reclaims West PHL Sea By Henry Empeño Correspondent

S

AN FELIPE, Zambales—Artists, human-rights advocates and local residents reasserted Philippine sovereignty over the West Philippine Sea by planting the national flag on the waters here on Monday, in commemoration of the 119th Philippine Independence Day. Surging from the beach early in the morning on June 12, participants in the three-day Kamp Kalayaan arts and freedom festival made a symbolic dash to the sea with the Philippine flag atop a bamboo pole, paddled out to the water on surf boards, and then planted the banner upon the seastrand before solemnly singing the national anthem. The poignant ceremony brought most of the audience close to tears, said Jena Rajni Miguel, a resident of Olongapo City who joined the camp as education director of the local arts group Rexa Center. “With the reality that parts of Philippine territory, like the Scarborough Shoal, are being taken away from us, this stirred in everybody here the feeling we should rightly fight for our country and protect what is ours,” she said. The activity, said Micheline Rama, executive director of the Dakila Philippine Collective for Modern Heroism that organized the event, was meant to send a message to all Filipinos that “freedom is a continuing struggle”. “We don’t just celebrate freedom; we should fight for it,” Rama said. “The Katipuneros who fought for Philippine independence believed there could be no kalayaan without kaginhawaan, kapatiran and kabutihang-loob. We say there could be no real independence while there are people living in abject poverty, caught in the crossfire in conflict zones, immersed in a culture of hate and violence, and deprived of their civil rights and

human rights,” Rama said. “Here at Kamp Kalayaan, we commemorate Philippine Independence Day by sparking discourse on freedom and human rights, as well as fostering kabayanihan through creative and collaborative community events,” she said. Kamp Kalayaan was located at Liwliwa, a seaside row of beach resorts at Barangay Santo Niño in this town, which faces the West Philippine Sea. The event started out last Saturday with a discussion on environmental protection and community action, a cleanup activity along the shore, and movies about freedom and independence, followed by music and art activities, including Barter Barber, Open Mic and tattoo sessions the next day. The camp’s major attraction was the “Kulay ng Kalayaan” mural painting that depicted graphical interpretations of the Philippine national anthem across 1,260 square feet of wall space. Rexa Center also sponsored an art contest on the second day to draw out the “heroes” among children-participants from the local community. The children later joined the mural-wall painting. The third day was capped by the “Paddle Out for the Philippines” activity and the flag-raising ceremony. The three-day camp also served to educate residents, including representatives of local government units, about cooperation and respect for each other, said Ralph Eya, Dakilas education director. “A lot of issues—like the war on drugs, declaration of martial law, and even the Scarborough Shoal issue here—have divided the country, and a lot of people have taken to social media where discourse has often become hostile. Here, we want to create a space where discourse about freedom and human rights are respectful and where participants listen and not just talk against each other,” Eya said.

KAMP Kalayaan participants dash out to the waters off San Felipe, Zambales, with the Philippine flag in a symbolic surge to reclaim the West Philippine Sea during the commemoration of Philippine Independence Day on June 12.

Quezon gov okays 4-yr agri-crop investment plan By John Bello Correspondent

L

UCENA CITY—Quezon Gov. David Suarez has approved the Provincial Commodity Investment Plan (PCIP) for 2018-2020, which covered various existing commodities for expanded production and development in various areas in the province. Provincial agriculturist Roberto Gajo presented the PCIP, which will be supported by the World Bankfunded Philippine Rural Development Project (PRDP), during the Provincial Development Council meeting led by Suarez and attended by various municipal mayors and municipal council development officers on May 29 at the Kalilayan Hall here. Gajo identified the commodities under PCIP, as abaca, coffee, mango, pineapple, cacao, banana, and lowland vegetables such as ampalaya, okra, squash and string beans. Seaweeds, dairy cattle and virgin coconut oil were earlier approved under the PCIP, which, Gajo said, serves as primary reference for local government units and other government agencies in planning and budgeting processes to support agriculture and fishery development in the province and in identifying agri-fishery investments. Gajo said the PCIP is a multiagency collaborative development

effort that needs the assistance of the departments of Agriculture, Labor, Trade and Industry, and Science and Technology, and various nongovernmental organizations. He said the PCIP involves six segmented processes including input supply, production support and planting materials; production and farm-to-market roads; processing, value additions such as corn to feeds, coconut to virgin coco oil and seaweeds to powder; marketing, trade fair and advertising, creation of market and production analysis; enabling environment, financing loan facility and policy guidelines for stakeholders; and research development and extension, capability enhancement, establishment of demo-techno farms and product development. Gajo said the PRDP has allocated P70 million to PCIP with a P12-million counterpart funding from the provincial government. The PRDP aims at least a 5-percent increase in annual real-farm income of the project’s household beneficiaries; a 30-percent increase in income of the enterprise development beneficiaries; a 7-percent increase in value of annual marketed output; and a 20-percent increase in number of farmers and fisheries with improved access to agricultural services. Gajo added growth areas for cof-

fee in the province are Candelaria, Pitogo, Real, General Nakar, Dolores, Guinayangan, Macalelon, San Antonio, Patnanungan, Jomalig, Infanta, Sariaya, Burdeos, San Francisco and Panukulan. Growth areas for mango include Lucena and Tayabas cities, Sariaya, Candelaria, Padre Burgos, Dolores, Atimonan, Plaridel, Macalelon, San Antonio, Pagbilao, Infanta, Pitogo, San Francisco, Unisan, Alabat, Calauag, Guinayangan, Gumaca, Lopez and Tagkawayan. Growth areas for pineapple are General Luna, Polillo, Macalelon, Sariaya, Tiaong, San Antonio, Lucena City, Calauag, Burdeos, Patnanungan, Pitogo, Guinayangan, Candelaria, Panukulan and Agdangan. Growth areas for lowland vegetables are Dolores, Tiaong, Gumaca, Pagbilao, Sariaya, San Antonio, Plaridel, Burdeos, Lucena City, Pitogo, Candelaria, Mulanay, Tagkawayan, Padre Burgos and Unisan. Growth areas for cacao are Alabat, Tagkawayan, Lopez, Atimonan, Guinayangan, General Nakar, Polillo, Real, Plaridel, Perez, Lucban, Patnanungan, San Francisco, Jomalig and Burdeos. Growth areas for banana are San Francisco, Dolores, Mauban, Buenavista, Lucena City, Infanta, Tagkawayan, Sampaloc, Mulanay, Burdeos, Unisan, Real, Patnanungan, Lopez and Jomalig. John Bello

A9

Solon urges protection of IDP rights

A

MID the conflict in Marawi City, a deputy minority leader urged the Duterte administration to certify as urgent a measure protecting the rights of internally displaced persons (IDPs). Deputy Minority Leader and Party-list Rep. Harry L. Roque of Kabayan said 180,000 people have already been internally displaced by the armed conflict in Marawi as of the end of May. “Given this and the fact the clash between government forces and the Maute Group in Marawi has not yet abated, the urgency of House Bill 222 could not be emphasized more,” said Roque, the principal author of the bill. The lawmaker said the government has to prioritize giving a sense of normalcy to the lives of those affected. “The massive displacement of Marawi residents and the destruction of proper t y—t he d amage wrought by the conf lict—could have been avoided if only the Armed Forces did not ignore warnings as early as last year that ISIS had already infiltrated Mindanao,” he said. The bill defines internal displacement as “the involuntary movement or forced evacuation or expulsion of any person or group of persons who flee or leave their homes or places of habitual residence, within the national borders, as a result of or in order to avoid or minimize the effects of armed conflict, situations of generalized and or organized violence, violations of human rights, implementation of development projects, natural, human-induced and human-made hazards.” The measure also seeks to provide for the protection of IDP rights during and after the displacement, as well as their return, local integration or resettlement elsewhere. Under the bill, if displacement is inevitable, the authorities, pursuant to their respective mandates and functions, shall ensure, to the greatest practicable extent, that proper accommodation is effected in satisfactory conditions of safety, nutrition, water and sanitation, health and hygiene, and that members of the same family, especially women and children, are not separated. Jovee Marie N. Dela Cruz

Cebu mayor wins another victory against suspension

C

EBU CITY—Danao City Mayor Ramon “Nito” D. Durano III won another victory in his fight against a three-month suspension ordered by the Office of the Ombudsman-Visayas. The Court of Appeals in Manila has converted the 60-day temporary restraining order (TRO) the CA Special 17th Division earlier issued into a writ of preliminary injunction. The CA also denied the Ombudsman’s move to recall the TRO and opposition to the preliminary injunction. The CA Resolution dated June 5, 2017 was signed by Associate Justice and Chairman Romeo Barza with the concurrence of Associate Justices Socorro Inting and Maria Filomena Singh. The TRO was granted on April 3, 2017 upon the petitioner’s filing of bond in the amount of P100,000. “Accordingly, the Ombudsman, the Secretary of the Department of Interior and Local Government, and any of their officers are enjoined from implementing the assailed Decision of the Office of the Ombudsman dated June 22, 2016,” read the resolution. The case stemmed from the complaints of Orlando Dagatan Jr., Amabella Gomez, Cecilia Lawas, Celso Aylwin Manulat, Leo Enriquez, Conchita Batuto and Maria Sofielyn Camance. They were appointed during the term of Durano’s brother and former Mayor Ramon “Boy” D. Durano Jr. from 2010 to 2013. The appointments of these personnel were recalled on July 1, 2013 by Nito, claiming the appointments of the complainants did not undergo the screening process, supposedly done by the Personnel Selection Board, as mandated under a City Council resolution. Charles R. Pepito

A10 Tuesday, June 13, 2017 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Quagmired

T

here was a time in the Philippines when graduates of the public-school system were as good, if not better, than those from private schools.

Public-school graduates then spoke well, wrote well and were good in math, English and science. They felt no inferiority complex and were proud of their education, which earned for them gainful employment even as high-school graduates and qualified them into the nice colleges. In fact, the older folks among us might remember a time when those who failed to get into public schools ended up studying in private schools, an ignominy that is somewhat reversed today. Today, the quality of one’s education is measured in a lot of ways by the price tag one has paid for it. The best private schools charge tuition most Filipinos cannot afford and are able to build top facilities and hire good teachers, hence provide good-quality education. In contrast, most public schools have inadequate facilities and overworked, underpaid and less qualified teachers who have to teach up to 80 students per class in two or even triple batches. In the Philippines we believe the best gift parents can give to their children is a good education. This is, perhaps, why parents try to do everything they can to get their kids into respectable private schools, even at the cost of running into debt, which a lot of them eventually do. It’s a pity then that free, public education is no longer synonymous to good education. If it were, we’ll have a lot less harried parents. Our banner story last Saturday, “New School Year, Old Problems,” told of the same festering problems in Philippine education—classrooms shortages and lack of teachers, facilities and learning materials, as the country’s publicschool system opened its doors to around 27.7 million students nationwide, including the first batch of Grade 12 students since the full implementation of the K to 12 Program. The Teachers’ Dignity Coalition (TDC) said that, even with the help of the yearly Brigada Eskwela, there is just not enough manpower and resources to repair and refurbish all the aging classrooms, school buildings and other facilities. Benjo Basas of TDC said the government still lacks the essential resources for schools, and the burden is left to the teachers to shoulder. The Department of Education (DepEd) has not supplied enough needed materials up to now, he said. The necessary materials that were supposed to have come from the DepEd come in trickles and so teachers have to spend out of pocket to reproduce them. Indeed, how can public schools even implement the K to 12 curriculum if the government cannot even bridge classrooms, teachers and textbooks shortages and meet other basic needs? Party-list Rep. Antonio L. Tinio of ACT said though that the “most significant shortage” in education is the number of out-of-school youths. He said about 3.4 million children are not able to go to school “due to lack of schools, especially in far-flung communities”. The Constitution mandates that education be given the highest budgetary priority. Among individual government agencies, the DepEd received the highest budget at P543.2 billion this year, a 25-percent increase over its previous budget of P433.38 billion. This money was supposed to fund teachers’ salaries, improve basic educational facilities, purchase instructional materials and give financial assistance to students. It was supposed to address the backlog in facilities and basic educational needs. Whether the problem is still a lack of funding or better expenditure planning and implementation or a sense of urgency to solve these shortages, this administration must deal with it once and for all. We cannot keep passing the buck on to the next administration. For the K to 12 curriculum to realize its goal to bring us up to par with international standards and produce better educated and more employable graduates, it must work under ideal conditions and move quickly beyond birthing pains, which it should have already done by this time. Obviously, K to 12 can’t work without teachers to teach subjects or textbooks and learning materials for students to study or classrooms to hold classes in. No curriculum can work without these basic needs.

Since 2005

BusinessMirror A broader look at today’s business ✝ Ambassador Antonio L. Cabangon Chua Founder Publisher Editor in Chief Managing Editor Associate Editor News Editor City & Assignments Editor Senior Editors

T. Anthony C. Cabangon Jun B. Vallecera

Lorenzo M. Lomibao Jr., Gerard S. Ramos Lyn B. Resurreccion, Efleda P. Campos Ruben M. Cruz Jr. Angel R. Calso

Creative Director Chief Photographer

Eduardo A. Davad Nonilon G. Reyes Judge Pedro T. Santiago (Ret.) Benjamin V. Ramos Adebelo D. Gasmin Marvin Nisperos Estigoy Aldwin Maralit Tolosa Dante S. Castro

BusinessMirror is published daily by the Philippine Business Daily Mirror Publishing, Inc., with offices on the 3rd floor of Dominga Building III 2113 Chino Roces Avenue corner De La Rosa Street, Makati City, Philippines. Tel. Nos. (Editorial) 817-9467; 813-0725. Fax line: 813-7025. (Advertising Sales) 893-2019; 817-1351, 817-2807. (Circulation) 893-1662; 814-0134 to 36. E-mail: news@businessmirror.com.ph.

www.businessmirror.com.ph

Printed by brown madonna Press, Inc.–San Valley Drive KM-15, South Superhighway, Parañaque, Metro Manila MEMBER OF

Manny B. Villar

THE Entrepreneur Continued from A1

I

N the evening of May 22, 22-year-old British-born Salman Abedi detonated a bomb packed with bolts and screws at Manchester Arena just as thousands of people were leaving after a concert by Ariana Grande. The explosion left a total of 23 people, including the bomber, dead and more than 115 wounded. The third attack, which was launched on June 5, three terrorists in a rented van plowed through pedestrians on London Bridge up to Borough Market where they alighted from the vehicle and went on a stabbing rampage. Eight people were killed and at least 48 were wounded. The series of terrorist attacks (experts are saying more are likely to be made) would have created an atmosphere of fear among the people, disrupting normal activities and even causing instability in a country, but these did not happen in the UK, which also proceeded with a snap election as scheduled last week. I believe the reason is the UK’s strength, and its people’s resilience. Terrorist attacks are like fires that cannot be sustained if the surroundings are wet. It’s like trying to build a

fire in the middle of a calm pond—it may burn something but it will not dry down the pond, or bring down a nation. While the terrorist attacks in the UK are different from what happened in Marawi, the Philippines and Filipinos are showing the same strength and resilience as the European nation. Members of the Maute terrorist group attacked Marawi City on May 23, prompting President Duterte to impose martial law in the whole of Mindanao. In another time, or perhaps with another chief executive, the terrorist attack and the imposition of martial law would have created an atmosphere of fear among the people and pessimism among investors. The economy, in particular, would have started to derail from its accelerating

and robust growth. It did not. Published reports cited BMI Research as saying the imposition of martial law in Mindanao was unlikely to derail economic growth of above 6 percent this year. I believe the strength of our economy is shielding us from any adverse impact of the terrorist attack in Marawi City. I saw a news report quoting a stock-market analyst as saying the declaration of martial law in Mindanao did not spook investors. Optimism among investors and consumers remain high, the stock market is booming and the peso continues to strengthen against the dollar. The Philippine Stock Exchange (PSE) index closed at a 10-year high of 8,001.38 points on June 5. In another report, the PSE said the combined income of listed companies grew by 17.8 percent to P683.30 billion in 2016, from P580.15 billion in 2015. Consolidated revenues rose by 6.6 percent to P7 trillion, from 2015’s P84 trillion. The “World Investment Report 2017” of the United Nations Conference on Trade and Development (Unctad) also confirmed the Philippines’s increasing attractiveness as an investment destination. According to the report, the Philippines is the second most-favored destination for foreign direct investments (FDI) in Southeast Asia, and the 10th overall. The Philippines emerged as the

The ‘turning’ continues to turn

Max V. de Leon Jennifer A. Ng Dionisio L. Pelayo Vittorio V. Vitug

Online Editor Social Media Editor

Chairman of the Board & Ombudsman President VP-Finance VP Advertising Sales Advertising Sales Manager Group Circulation Manager

Of Manchester and Marawi

John Mangun

OUTSIDE THE BOX

Y

ou may have heard the song “Time” from the band Pink Floyd and their album The Dark Side of the Moon many years ago. The lyrics read in part, “So you run and you run to catch up with the sun but it’s sinking, racing around to come up behind you again.” Our life—birth, living and death —is a straight line. The movement of the sun is a round cycle. Because of that contradiction, it is sometimes difficult to accept the idea of cycles except for those that are impossible to ignore. And yet, when humans could not figure out the cycles, such as for solar and lunar eclipses, we felt that the universe was random or failing. So it comes down to: when we understand the cycles, all is good; when we do not, probably there is not a cycle. Sort of. If we do not recognize that a cycle exists, then we think we can do something about an event. If there is not a cycle to eclipses, then

all we have to do is sacrifice a few virgins and we can control the occurrence of future eclipses. If wars are not cyclical, then the solution is to get the right politicians in charge. If there is not a boom-bust cycle to economies, then all we need to do is get the “right” government economic policy to stop recessions and depressions. If we do not accept that climate may be cyclical, how do we explain great regional temperature changes higher and lower through recorded history? Neither the late William Strauss nor his literary colleague Neil Howe was a historian in the classic sense.

They might better be described as “observers of history”. Their two books—Generations in 1991 and The Fourth Turning in 1997—theorize a “generational cycle” that attempts to explain the changes in national “mood” and actions. Each generation evolves through four periods of 20 years—roughly long life expectancy—of childhood, young adult, midlife and elderly. Each generation experiences “four turnings”—high, awakening, unraveling and crisis. Further, society goes through this same “turning” of high, awakening, unraveling and crises. For example, the “Baby Boomer [born 1946-1960] Generation” grew up during a postwar “high” in the US of “Superpower America”. The assassination of John Kennedy in 1963 was a turning point of “awakening” for them. “Unraveling” began in the mid-1980s when traditional values were under intense debate. The US experienced several economic recessions and perhaps culminated with the 2001 terrorist attack in New York City. Michael Hart at Stock Board Asset wrote, “In the Fourth Turning [of the crisis period], a destabilizing event leads to the destruction and reconstruction of institutions of power.

top performer in Southeast Asia last year, when it recorded a 60-percent growth in FDI inflows. The benefits of a growing economy also continue to show in the employment sector. According to the Philippine Statistics Authority (PSA), the unemployment rate declined to 5.7 percent in April 2017, down from 6.1 percent in April 2016 and the lowest in more than 10 years. Underemployment also went down to a low of 16.1 percent, or from 7.43 million in April 2016 to 6.47 million in the same month this year. These developments comprise what I call the positive side of what is happening in Marawi, which does not receive as much publicity as the terrorist activities. We should realize that in the end, the strength of the republic and its people will make it very difficult for terrorists to succeed. We need to support Duterte’s efforts to boost the economy and sustain its growth to ensure that terrorists will never be able to sow fear among us. Let’s ponder on what Manchester Mayor Eddy Newman said during a tribute to the victims of the May 22 bombing: “The people of Manchester will remember the victims forever and we will defy the terrorists by working together to create cohesive, diverse communities that are stronger together.”

For comments, e-mail mbv.secretariat@gmail. com or visit www.mannyvillar.com.ph.

This fourth stage can be seen as the inverse of the awakening stage, and the authors cite World War II as the defining event of the most recent period of crisis”. Out of 185 nations, 130 have an annual economic growth lower than population growth. Of the 58 that have reported first quarter 2017 numbers, 40 are running at 1 percent or less. Brazil impeached its president Dilma Rousseff; her replacement now faces impeachment. South Koreans just elected Moon Jae-in who wants to move closer to China, and wants direct talks with North Korea. The Baby Boomers crisis period began in 2008 with the global economic collapse. On a national level, Strauss and Howe have predicted that the crisis period would begin around 2005 and last until 2025. This fits with Martin Armstrong’s Economic Confidence Model that foresees peak political and economic disruption coming in 2020. Enjoy 2017. The fun will continue.

E-mail me at mangun@gmail.com. Visit my web site at www.mangunonmarkets.com. Follow me on Twitter @mangunonmarkets. PSE stockmarket information and technical analysis tools provided by the COL Financial Group Inc.

Opinion BusinessMirror

opinion@businessmirror.com.ph

Martial law has limited potency to contain terrorism Cecilio T. Arillo

DATABASE

T

HE 1987 Constitution, crafted after former President Corazon C. Aquino unilaterally took over the presidency in the 1986 People Power revolt, made martial rule and the suspension of the privilege of the writ of habeas corpus virtual impossibilities and of limited potency, making their declaration by the President, as well as their duration, subject to the pleasures of Congress and/or of the Supreme Court. “Provisions of the Constitution also make the Republic prone to instability, particularly the shortened terms of office of public officials and limitations on successive uninterrupted terms. While the intention for these are noble, these have only induced dynasties, discontinuity of policies and excessive politicking at the expense of public service,” argued the best-selling book, A Country Imperiled-Tragic Lessons of a Distorted History, recently published by Amazon, one of the world’s largest publishing houses. “The most glaring weakness of the Aquino Constitution is less in its text rather than its nonimplementation. Of what use are the provisions on elections, impeachment and recall when presidents can be deposed anytime, and the resulting extraconstitutional succession or takeover ratified or legitimized in unorthodox ways or those inconsistent with laws?” the book said. Thus, it is a great wonder if the Philippines, which is a “democratic and republican state”, as the Constitution phrases it, can develop the strength it needs to become competitive internationally and stable internally. In addition to structural changes based mainly on incoherent congressional actions, it appears that what is needed to mold a stronger Republic from the national security viewpoint is a disciplined citizenry, a responsible government and a fervor for national unity and patriotism. A framework for a plan of action can be found in the Human Security Act (Republic Act 9372) that took effect on February 8, 2007. In that law, the conceptual scope of national security was expanded, from the conventional political and military threats to the Republic’s peace, sovereignty and territory, to encompass public health, food and other sustenance, shelter and social services, environmental and cultural, social and intellectual growth. This edict is the primary antiterrorism law that brings the country in line with its Southeast Asian neighbors battling Islamist militants. It is aimed in particular at tackling

lawless violence in Mindanao. The antiterrorism law is in itself a formula for a strong Republic. But, apparently, its provisions have not been pursued in the required comprehensive and coherent manner. Not saying that democracy does not figure in the equation, it must be pointed out that in the more than 31 years of democracy that have transpired since the 1986 Edsa uprising, the Republic has yet to enjoy a meaningful moment of strength. Always, the nation wallows in insecurity and instability, not knowing when fuel and power prices will rise again, or whether the current president will complete his or her term, or when the next coup d’état will come, or where terrorists, kidnappers and criminal syndicates might strike next, or which bank or preneed company will collapse soon or whether the government will make compromises in negotiating peace with rebels.Democracy has made the nation neither stronger nor more prosperous, and in the final analysis, it has not even gainfully increased liberties and rights, except among dissidents and subversives. The practice of democracy is not alien to Filipino temperament, and the theory that Asians find greater security or comfort in despotism is hardly applicable to the country. This is so because, in the Philippine setting, the practice of democracy has been long on freedoms, rights and privileges, and short on being responsible, dutiful and disciplined. Still, hope remains for the Republic of the Philippines. Japan and Germany, which are both devastated worse than the country at the end of World War II, have since become world economic powers. Apparently, their citizens and leaders were more patriotic, disciplined, united and resolute. The Republic, never having been a world power, not even an Asian power, is still developing its unity and strength, the process slow and erratic. To reach the writer, e-mail cecilio.arillo@ gmail.com.

AI–After inflation PAUL DONOVAN

W

HAT comes after the recent inflation? More inflation— but of a less obvious, more subtle sort. In 2015 and 2016 there was a 75-percent decline in oil prices. Oil is between 3 percent and 5 percent of most countries’ consumer price-inflation baskets—the headline inflation rate was bound to be affected. The resulting low inflation rate produced a frenzy of media speculation about a deflation threat. Deflation occurs when lots of prices are falling. The low inflation of 2015 and 2016 was about just one price falling. As soon as the oil price started to behave normally, it was obvious that headline inflation would behave normally.

Inflation is around normal

US inflation rates are at or above their 20-year averages.This is not a low-inflation environment; it is a somewhat higher-than-normal inflation environment. The euro area is a bit behind the US. Inflation in the Eurozone has been

Tuesday, June 13, 2017 A11

Widening gulf, vanishing cooperation Edgardo J. Angara

T

HE prosperous oil-rich states ringing the Arabian Sea are part of the famously known Gulf Cooperation Council (GCC)—a regional intergovernmental political and economic union in the Middle East. GCC members include Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. Last week a diplomatic crisis erupted when all GCC members except Kuwait and Oman—plus Egypt, Yemen, the eastern government in Libya and even the Maldives—openly declared they were boycotting Qatar and severing diplomatic ties, and all transport, people movement, food and other supply lines. The massive blockade has since placed Qatar under a state of immediate emergency. The country imports up to 40 percent of its food over its only land border with Saudi Arabia (perhaps the most powerful among the boycotting nations). It has a resident population that is 80 percent foreign-born. And, its rich economy requires freedom of movement to export its petroleum and liquefied

natural gas, which account for up to 60 percent of GDP. The public justification given for this open quarrel is Qatar’s alleged coddling and financing of Muslim extremists, a charge many Persian Gulf nations have long thrown against the Qataris. The most immediate cause being cited, however, were remarks published by Qatar’s state-run news agency allegedly from the ruling emir, Tamim bin Hamad al Thani, giving praise to Israel and Iran. The two countries are among Saudi Arabia’s most virulent adversaries in the region. The Qatar News Agency quickly said the remarks were false and were inserted by computer hackers employing “high techniques and

innovative methods”. Saudi Arabia et. al. were obviously unconvinced, although Qatar’s emir did not help stave off the anger when a few days later, he called to congratulate Iranian President Hassan Rouhani for his reelection. The geopolitical rift saw interesting alignment and realignment of allies. Iran, Turkey, Syria, Iraq and Afghanistan immediately supported the Shiite-controlled Qatar, as against the Sunni-dominated GCC. Some analysts even point out that US President Donald J. Trump’s recent trip to Saudi Arabia emboldened it to become more aggressive with its long-time rivals. Modern geopolitical exigencies notwithstanding, it appears that the current crisis harks back to the historic feud between the world’s two major Muslim denominations— Sunni and Shia. This schism happened as early as 632 AD when the death of Mohammad led to violent conflicts over who should succeed the Prophet to become caliph of the Islamic community. Through the years, differences emerged in religious practice and interpretation (or hadith), eventually becoming the foundation for political divisions that, in some way, are still in place. Today Sunnis comprise up to 90 percent of the world’s Muslims and account for the majority of

Islam’s devotees in Saudi, Egypt and even Indonesia. On the other hand, Shias are a minority in global terms, but make up the largest populations in countries like Iran, Iraq, Lebanon and Azerbaijan. In itself, Qatar ascribes to a Sunni version of Islam. But its position as a “go-between” in the Middle East places it in the middle of an unstated religious conflict and, hence, on the receiving end of an unprecedented diplomatic blockade. For one, it’s supportive of groups some may consider to be extremists, like Hamas in the Gaza strip or the Muslim Brotherhood in Egypt. But it does so while hosting the US Armed Forces Central Command, hell-bent on weeding out radical extremism in the region. Qatar’s position is only made more tenuous by its financing of the Al Jazeera network, which on occasion has been critical of the human-rights records of Saudi Arabia and its allies. Upon the mediation of Kuwait, Qatar recently expressed its willingness to dialogue with its boycotting neighbors. We hope that, in the interest of so many Filipinos working and living in Qatar, an end is near for the widening gulf happening around the Arabian Sea. E-mail: angara.ed@gmail.com, Facebook and Twitter: @edangara

Mega railway project to cost P90M more Ernesto M. Hilario

ABOUT TOWN

T

HE Duterte administration’s aggressive “Build, Build, Build” infrastructure-development project is supposed to usher in what is touted as the “golden age of infrastructure” in the country, at a whopping cost of P8 trillion until 2022. A number of projects have been proposed under the Build, Build, Build framework that will dramatically change the Philippine landscape, including roads and bridges, airports and seaports and mass-transport systems, including a subway system for Metro Manila. The North-South Railway Project (NSRP) is envisioned to provide better transportation and logistics services between Metro Manila and Southern Luzon by restoring the oldest rail system in Southeast Asia. It is part of the Duterte administration’s objective to catalyze economic growth in Southern Luzon by providing critical connectivity through a world-class passenger-rail service. The proposed NSRP covers Metro Manila to Legazpi City in Albay province, plus a number of existing and proposed branch lines totaling approximately 653 kilometers. It consists of a 56-km commuter railway operation between the existing Tutuban Station in Manila and Calamba in Laguna. This

increasing, but it is at rather than above long-term averages. Investors should remember that the low headline inflation of 2015 and 2016 was an oil-induced hallucination. Half the major Organisation for Economic Co-operation and Development economies had core (ex., food and energy) inflation at or above long-run averages over those two years.

Inflation is local

IF oil is not swinging about wildly, inflation is largely driven by domestic-labor markets. Domestic-labor costs are between 60 percent and 70 percent of the consumer-price basket. Domestic-driven inflation can be seen in the low correlation of core consumer price-inflation rates. If there were a global driver of inflation pressures, core inflation would be correlated between major economies. They are not. The correlation of core inflation rates

section represents an existing Philippine National Railway (PNR) rightof-way, which runs through Metro Manila. Extensive rehabilitation and reconstruction will be undertaken by the Department of Transportation (DOTr) and the PNR to bring it to safe operating condition. The other component of NSRP is longhaul railway operations between Tutuban and Legazpi, including extended long-haul rail operations on the branch line between Calamba and Batangas and extension between Legazpi and Matnog. At present NSRP has a narrow gauge railway. But rail-transport experts have raised questions as to why the DOTr and National Economic and Development Authority officials want to replace the narrow gauge in favor of the standardgauge track system, when the use of wider tracks will make this project more expensive, unduly delay its completion and result in safety, efficiency and technical concerns.

between major economies, even between Eurozone economies, is very low.

Pay attention to the price measures that matter

ALL too often, the consumer priceinflation measure is treated as if it were the only inflation measure that matters. It is not. For bond investors, the inflation rate central banks focus on matters. In the Eurozone and the UK, headline consumer-price inflation is the central banks’ mandated target. In the US, the Federal Reserve looks at the personal consumerexpenditure deflator—very different and occasionally divergent from consumer-price inflation. Equity investors need to look at different indices again. Most companies do not sell to consumers; most companies sell to other companies. Companies selling to consumers are 10 percent to 20 percent

The narrow-gauge technology, according to the DOTr, is already becoming obsolete. But the narrow-gauge technology is still being used in Japan, Australia, New Zealand and other developed countries. Experts say the use of narrow-gauge tracks, also known as the Cape Gauge, is cheaper than the broad gauge in railways. The DOTr plans to change the narrow-gauge tracks of 1.067 meters to the standard-gauge tracks of 1.440 meters is seen bloating the cost of the NRSP from P170 billion to P260 billion, or a markup of P90 billion. The planned change to standard gauge will unduly delay the project, as narrow tracks have already been laid out up to Naga City and will only require rehabilitation. The switch to the more expensive standard gauge will require not only reconstruction of the tracks, but also additional right-of-way acquisitions, which have caused undue delays in many land-transport projects in the past. Maintaining the narrow-gauge system will meet safety and efficiency requirements, because such narrow tracks operate safely and efficiently at top train speeds of 140 kph to 200 kph. This perfectly fits the design speed of both PNR North (from Tutuban to Malolos City) and PNR South (Tutuban to Naga City), which run at a top train speed of 140 kilowatts per hour and an average speed of 80 kph. In contrast, standardgauge trains operate at speeds of 250 kph, or almost double that of trains running on narrow-gauge tracks.

The unnecessary switch will be a burden to Filipino taxpayers, because they will eventually have to pay more in terms of higher taxes to cover the extra project cost of P90 billion without gaining any additional benefit from the project. Some 30,000 daily train passengers will also be inconvenienced, considering that the need to reconstruct or build, instead of just rehabilitating, the railway will mean that the PNR Commuter Service will be stopped completely during the reconstruction and relaying of the tracks that will take months, if not years, to finish. The DOTr has been spearheading the track switch on grounds that narrowgauge trains and locomotives are heading for obsolescence in the next decade and will thus limit supplier options. However, this argument is untenable because the narrow gauge is far from becoming an obsolete rail technology. According to General Electric, the world’s leading locomotive manufacturer, narrow-gauge trains will continue to operate in the next decades, which means that train manufacturers will continue producing narrow-gauge trains and train spare parts. The question now is: Will President Duterte allow this project to cost an extra P90 billion when it could actually be completed a lot cheaper and much faster using a technology that has been proven to be safer and more efficient for train passengers?

of the US Standard & Poor’s index. Producer price-inflation measure is the most appropriate indication of domestic pricing power. In a world where all inflation rates are rising rapidly, investors do not have to worry about these details; in a more normal inflation environment, understanding exactly which inflation rate matters to which asset is important.

they may not feel any better off, and they may not have any more money to spend on other things. Conversely, if a chocolate bar gets smaller without the price changing (sometimes called “shrinkflation”), the consumer-price measure will rise even though the price does not change.

Inflation changes, prices don’t have to

INFLATION can change without prices changing. Inflation adjusts for quality and quantity. US mobile phone-service inflation fell recently, not because people pay less money but, because people are able to download more data for the same amount of money. The quality gain caused inflation (not prices) to fall. W hy does t hat matter? If people are not paying less money,

E-mail: ernhil@yahoo.com.

After inflation—subtle inflation

THE rise of inflation at the start of this year was an easy forecast to make. Now that the inflation increase has largely occurred, investors have the more difficult task of understanding the subtle shifts in the different inflation rates that matter. Paul Donovan’s latest book The Truth About Inflation was published by Routledge in April 2015. Visit www.ubs.com/pauldonovan for more research. Paul’s commentaries in the UBS series of documentaries on Nobel Laureates in economics is available at www.ubs.com/nobel.

2nd Front Page BusinessMirror

A12 Tuesday, June 13, 2017

www.businessmirror.com.ph

Rubbles feared to reveal more bodies

F

rom the third-story window of a barren government office building where he now squats as a refugee, Nasir Abdul is watching his city being destroyed.

Nearly every day for the past three weeks, the Philippine military has pounded the lakeside city of Marawi with rockets and bombs, as it tries to wipe out militants linked to the Islamic State (IS) group in some of the fiercest urban combat this volatile region has seen in decades. And on nearly every one of those days, Abdul has stood at the window and watched, unable to turn away from the deadly spectacle unfolding just a mile (a kilometer and a half) away. As plumes of thick, black smoke wafted above the city’s minarets again last Friday—a day of intense skirmishes in which the army lost 13 marines—Abdul stood transfixed with dozens of other displaced residents. Two helicopter gunships had just finished strafing the city, and now people were pointing toward a Vietnam-era attack aircraft circling overhead. The plane, an OV-10 Bronco, turned and dove straight down

225 The estimated Marawi siege death toll as of latest reports

on the city center, firing off two bombs before suddenly pulling up its nose and spiraling away. Moments later, blasts shook the city and more smoke billowed skyward. “It feels impossible that this is happening,” the 45-year-old Abdul said, as the sound of gunfire crackled in the distance. When “I see the bombings, I can’t help but cry. I can’t help but think what’s happening to my relatives, my family, my business, my house.” Three weeks after a new alliance of Islamic militants tried to seize this town in their boldest

attack yet, large chunks of downtown have been reduced to ruins. Militants remain holed up in several pockets scattered around the city center, along with at least 100 civilians, including hostages the army says are being used as human shields. There is no electricity, and most of the town’s 200,000 inhabitants have fled. The military says the death toll includes at least 138 militants, 58 government troops and 29 civilians—among them a teenager shot last Friday as he sheltered inside a Marawi mosque. But the fighting is so intense, it’s impossible to fully recover bodies to get an accurate casualty toll. “It hurts to watch because we know people are dying with every bomb,” Abdul said. “We know a lot of people are buried under that rubble.” The conf lict in Marawi has raised fears that the IS group’s violent ideology is gaining a foothold in this country’s restive southern islands, where Muslim separatists have fought for greater autonomy for decades. The military says militants are trying to establish a caliphate here, similar to one IS has attempted to create in the Middle East that stretches from the Syrian city of Raqqa to embattled Mosul in Iraq. They believe 40 foreign fighters

have participated in the fighting in Marawi, including Malaysians and Indonesians. The government has asked the US to provide intelligence and other technical support, and at least one American surveillance plane has flown in support of Philippine forces. Abdul said that while people in Marawi support autonomy, few back the extremist militant groups who have carried out kidnappings and beheadings. However, Lt. Col. Jo-ar Herrera, spokesman for the army’s 1st Infantry Division, said the insurgents likely have “a lot of sympathizers, a lot of supporters in this area”. The main group leading the siege, the Maute, has deep roots in the city—“in terms of relatives, in terms of connections, in terms of culture, heritage,” he said. The Maute, named after three militant brothers, staged a similar attack last November on nearby Butig, on the opposite side of Lake Lanao, which lasted six days. But the intensity of the latest assault, and the ability of the militants to hold out for so long, appears to have caught the government off guard. Herrera said insurgents had prepared for as much as a year, stocking basement caches with food, weapons and ammunition. Rexson Tamano, who is sleeping

on the floor of an outdoor hallway in the same provincial government building as Abdul, said he saw no suspicious activity and no sign an attack was imminent. W hen gunfire heralded the start of the siege on May 23, he called his pregnant wife on the other side of town to check in on her and their four children. “She said, ‘Stay where you are, please don’t come for us, it’s too dangerous,’” Tamano recalled. He ran home anyway, but was stopped at a checkpoint manned by militants. They wore black ski masks, and each held a machine-gun. “I tried to walk away but they called me over and asked whether I was Muslim or Christian,” Tamano said. He told them the truth —he was Muslim, and they waved him through. The city’s minority Christians have been singled out for execution. Mikee Rakim, a humanitarian volunteer, said one group of 10 Christians told him they had been taken hostage when the fighting started. Militants beheaded two of them and were preparing to kill the rest when an air strike hit a neighboring house, enabling them to escape. While most of the displaced have sheltered inland, Abdul and Tamano are among about 200

people who have chosen to remain close to the city, anxious to return when the fighting ends to homes they fear were either looted or destroyed. The government has distributed food, water and sleeping mats to the families camped out here, who gather in small groups at the windows every time the fighting intensifies. While explosions shook Marawi last Friday and fighter jets buzzed overhead, one boy pushed a baby on a stroller through a hallway. In a corner, several other children sat making toy tanks out of paper. “ISIS! ISIS!” cried one boy, laughing as he pointed to a tiny black flag on one of the tanks. Fahadda Camim, who was conducting an assessment for Community Family Services International, a Filipino humanitarian organization, said the children were “copying what they see outside” and were in need of counseling. The adults, too, are traumatized, she said, and “some are still very afraid”. The clashes are a constant reminder that their lives have been upended, and their fates remain uncertain. Abdul said he did not want to watch the fighting. But he could not resist, either. “It’s our city,” he said. “It’s so painful. It’s impossible to turn away.” AP

DUTERTE NO-SHOW AT INDEPENDENCE DAY RITES IN LUNETA

‘EIGHTH WONDER OF THE WORLD’ Widely regarded as the “eighth wonder of the world”, the Banaue Rice Terraces in Ifugao province is one of the World Heritage Sites in the Philippines. The Ifugao ethnic group carved the terraces using their bare hands about 2,000 years ago. As seen in the photo, houses have already occupied part of the mountain, but Ifugao farmers continue to plant rice in the terraces. FAYE PABLO

Envoy mum on US military engagement in Marawi By Elijah Felice E. Rosales

KIM: “I don’t think it’s appropriate to go into details. All I can say is that this is a cooperation that’s continued for some time now.”

@alyasjah

C

onfusion on whether the Philippines really asked for military aid from the United States in its bid to crush Islamist militants in Marawi City began to surface, as US Ambassador to the Philippines Sung Kim on Monday refused to provide details on the matter. “I don’t think it is appropriate [to discuss] technical details as to what [kind of assistance] we are providing,” Kim told reporters after the 119th Independence Day rites in Rizal Park, Manila, which President Duterte skipped. “I think we have stated clearly that we continue our cooperation and support with the Armed Forces of the Philippines [AFP].” Last week AFP Spokesman Restituto F. Padilla Jr. said the military asked its US counterpart for noncombat assistance in its operations in the southern third of the Philippines. In response, the US provided spy planes that serve as surveillance support in Marawi City for government troops. “I don’t think it’s appropriate to go into details,” Kim reiterated, when pressed by reporters to discuss further about the military support given by the US to the Philippines. “All I can say is that this is a cooperation that’s continued for some time now. It’s cooperation

that’s appreciated by the Philippines’s military. It is a cooperation that has continued with the knowledge of the Philippine government and the military obviously.” Last Sunday Duterte said he “is not aware” of the military aid from the US until foreign troops landed in Mindanao. “When I declared martial law, I gave the powers to the defense department,” he said. Duterte, who was vocal about his criticisms against the US, once said the Philippines does not need the superpower’s military support. This, in spite of a long history of military relations between the Philippines and the US, evidenced by the fact several agreements in war games have been signed by the two countries in the past years, including the Mutual Defense Treaty and the Enhanced Defense Cooperation Agreement.

House probe

PARTY-LIST Rep. Carlos Isagani T. Zarate of Bayan Muna said he would file a

resolution to probe the US intervention in Marawi City, especially now that Duterte himself admitted that he did not know the involvement of the US troops and did not seek any assistance from the US. He also urged the House leadership to immediately schedule a hearing on this resolution. “The probe should dig deeper into the role of the US and the CIA [Central Intelligence Agency] in the activities and merger of their own covertly created terror groups, the Abu Sayyaf and Maute groups, particularly its link to the USsupported ISIS [Islamic State of Iraq and Syria], which undermine regimes like the Duterte administration, for the geopolitical and economic interests of the American government,” Zarate added. “This is very alarming. The Commander in Chief himself does not know that his military and security officials have already asked assistance from the US.”Zarate also urged Duterte to remove “pro-US militarists” Defense Secretary Delfin N. Lorenzana and National Security Adviser Secretary Hermogenes C. Esperon Jr. “These militarists are all out for the US that is why they are also doing all they can to sabotage the peace talks between the GRP [Government of the Republic of the Philippines] and the NDFP [National Democratic Front],” he said.

Condemned

Meanwhile, Party-list Rep. Emmi De

Jesus of Gabriela condemned the involvement of US troops and assets in the government’s offensive versus the Maute Group in Marawi City. The lawmaker said the active involvement of US military forces in the government’s operations in Marawi “constitutes a grave affront to the motherland’s sovereignty and bodes more rights violations against women and children, in particular.” For her part, Party-list Rep. Arlene Brosas of Gabriela called for the immediate halt to air strikes, as she said the all-out military offensive in Marawi City that continues to wreak havoc and endanger the lives of women and children. “It’s ironic for Filipinos to celebrate Independence Day when the government continues to pound civilian communities with bombs and bullets, when people are enslaved in fear and misery. This lopsided and bloody militarist approach must end. Martial law must be lifted now,” Brosas said. The lawmakers said the crisis in Marawi City has displaced a total of 50,327 families, or 245,341 persons, in 27 barangays in Marawi and 13 barangays in the nearby town of Marantao. These militant lawmakers are among those who are seeking the Supreme Court’s opinion on Duterte’s martial-law declaration in Mindanao. With Jovee Marie N. dela Cruz

A flag-raising ceremony was held at the Rizal Park in Luneta, Manila, in commemoration of the 119th year of Philippine Independence. The event was led by Vice President Maria Leonor G. Robredo and Foreign Secretary Alan Peter S. Cayetano and was also attended by other government officials. ALYSA SALEN

P

resident Duterte skipped the Independence Day rites held in Rizal Park, Manila on Monday due to exhaustion, according to Foreign Affairs Secretary Alan Peter S. Cayetano. Minutes before the Independence Day rites, Presidential Spokesman Ernesto C. Abella informed reporters Duterte will not be able to make it to the ceremony. Abella said the Chief Executive did not state any specific reason for this and refused to answer questions from the press. “He will not be able to come this morning. He did not give any reason why,” Abella told reporters awaiting the President’s arrival in Luneta. This was supposed to be Duterte’s first Independence Day as President. The country’s Chief Executive usually attends the Independence Day rites to commemorate one of the most significant events in Philippine history. In lieu of the absent Duterte, Foreign Affairs Secretary Alan Peter S. Cayetano marched with Vice President Maria Leonor G. Robredo, his former election rival, to offer a wreath to the country’s heroes. Cayetano also stood side by side with Robredo in the flag-raising ceremony. After the rites, Cayetano told reporters Duterte had to skip his first Independence Day as President as he lacked sleep after attending to several businesses prior to the event. Duterte last Sunday visited wounded-in-action soldiers in Cagayan de Oro City, before giving his final salutes to killed-in-action government troops brought in Pasay City. “You know the President has been working [whole day, whole week], meeting the troops, meeting the commanders and then late last night, visiting the wounded and those who died in conflict. So that’s why this morning, he didn’t feel that well,” Cayetano said. “I don’t have the full details but I received the call around 5:30 a.m. from his people and they said, ‘No problem. He’s okay, but tired. He doesn’t feel that well so better [for him] to rest’,” Cayetano added. Cayetano said the Chief Executive opted to rest the morning away. His aides did not force him to get up from bed and force the issue as he only slept for about three hours. In a statement, United States Secretary Rex W. Tillerson congratulated the Philippines, on behalf of President Donald J. Trump and the American people, in its celebration of its 119th Independence Day. Tillerson said the US is “proud” of its longstanding relationship with the Philippines, especially at a time the country is facing the threat of terrorism and extremism. “We admire the resilience and strength of Filipino people in battling adversity and building a more prosperous and secure future. On this special day, we honor the enduring US-Philippines alliance built on our shared democratic values, growing commerce and strong people-to-people ties,” he said. Elijah Felice E. Rosales