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y, June 29, 2018 Vol. 13 No. 258

Friday, June 29, 2018 Vol. 13 No. 258

HE national government “[The lower amount Cu @ReaCuBM lowered By itsRea domestic is due to the] RTB borrowing program for and sustained the third quarter to P300 bilgood collection lion, on the back of robust colperformance of lections of the main revenue the government’s total tax [the] BIR and BOC.” agencies of the government. —de Leon revenue for the january-may National Treasurer Rosalia period of P240 billion for the first quarV. de Leon cited the good perThe government’s total tax revter of this year, awarding only formance of both the Bureau enue for the period amounted to P124 billion in the end. of Internal Revenue (BIR) and P1.066 trillion, expanding by 18.4 Broken down, P195 billion Bureau of Customs (BOC), as percent from the recorded P901 bilwill be borrowed through Twell as the successful retail lion last year. bills and P105 billion through Treasury bond (RTB) issuance In terms of total revenue, the T-bonds, with the auction for earlier in the month. government registered P1.186 trilT-bills happening on a weekly “[The lower amount is due lion this year, expanding by 19 perbasis and the auction for Tto the] RTB and sustained good The DOF’s latest economic bul- P996 Tax revenues from the Bureau of Bureau of Customs cent compared to last year’s bonds every fortnight.(BOC), collection performance of [the] For the letin said the improvement in the Internal Revenue (BIR) rose by 15.5 tax revenues grew by percent, ms (BOC), billion. Revenue effort rose by 1.43 During the 31.2 July-to-SepBIR and BOC,” de Leon said in a from points, January to May reach P827.7 billion for amounting to P229.4 for the 2 percent,tax effort percentage settling at 18.7percent totext tember period,billion the Treasury message. wascoming “highest first five this year comparedin the five-month period, coming from on for thethis year percent, from 16.74 percentthe same period is set to have 13 auctions for Domestic borrowings taxsame effortperiod ever achieved.” to last year’s billion. billion in 2017 ing frommonths’ in the for 2017. six-month and formP716.8 of Treasury bills (T-bills) P174.9three-month, Continued on A2 one-year IOUs at an offer size and Treasury bonds (T-bonds) of P15 billion. A total of sevwere lowered to P300 billion en auctions is set for T-bonds in the third quarter, coming with an offer size of P15 bilfrom the P325 billion in the lion each, as well with the tensecond quarter of this year. ors ranging from three, five, This showed a contraction of seven, 10 and 20 years. 7.6 percent. The national government The government had set a See “Borrowings,” A2 domestic borrowing program

₧1.066 trillion

first by rcent, ng as form

xi tells mattis: china won’t yield ‘1 inch’ of territory

RESIDENT Xi Jinping told US Defense Secretary James Mattis he wouldn’t give up any territory that China considered its own, an unusually blunt warning as security disputes simmer below a fight over trade. Xi made his remarks while meeting Mattis on Wednesday in Beijing, the first such visit by a US defense chief in more than four years. The comments appeared to be a reference to US complaints about Chinese military deployments in the disputed South China Sea and a push by American lawmakers to expand ties with the democratically run island of Taiwan, which Beijing considers a province. “Our stance is steadfast clear-cut hotel brand in Newport City, the P5-billionand savoy Hotel Manila. China’s have uniquewhen views itof comes the Naiato runway and sovereignty the Makati skyline. and territorial integrity, ” Xi said, accordPasay City Mayor’s Office; Raymundo Melendres, group hotels ing tomanager, the official Xinhua News Agency. nzo Tang, general savoy Hotel Manila; Lourdes See “Mattis,” Conversion and development authority; A12 and stephen Reilly,

HE government’s tax effort for the first five months of the year increased by 1.19 percentage points to 16.33 percent, the Department of Finance reported, citing as factors the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law and enhanced administrative efforts by revenue-collecting agencies.

DA pours in millions to turn ‘Bora’ into agro-tourism site

₧1.066 trillion the government’s total tax revenue for the january-may period

The government’s total tax revenue for the period amounted to P1.066 trillion, expanding by 18.4 percent from the recorded P901 billion last year. In terms of total revenue, the government registered P1.186 trillion this year, expanding by 19 percent compared to last year’s P996 billion. Revenue effort rose by 1.43 percentage points, settling at 18.7 percent, coming from 16.74 percent in the same period for 2017. Continued on A2

HE Department of Agriculand seeds to be planted on a portion ture (DA) is turning Boracay of the 2.1-hectare ancestral domain Island into an agro-tourism area of the Ati tribe in Barangay site by pouring millions worth of inManok-manok. terventions and facilities, which are The DA also pledged to establish expected to be operational when the a solar-powered greenhouse, an area reopens to visitors in October. organic restaurant, tribal vacation Agriculture Secretary Emmancottages made of indigenous builduel F. Piñol said members of the ing materials and a solar-powered Ati tribe, including farmers and irrigation system in the area, acfishermen, received a “bonanza” cording to Piñol. All of these esof government support, and this tablishments could be operated saVOyisHOTeL IN NewPORT CITy Megaworld opened its second by savoy hotel brand in Newport expected to help them earn has and handled the members of City, the P5-billion savoy Hotel Manila. Locatedmore across the Naia Terminal 3, the 11-story “airport hotel” rooms that have unique views of the Naia runway and the Makati skyline. income. theoffers Ati 684 tribe. Leading thePiñol, hotel’s ceremonial were (from the Pasaywhich City Mayor’s Office; Raymundo Melendres, group hotels who wasopening in Boracay onleft) engr. albert “TheParedes other of projects were head, Global Inc.; kevin L.P1.950 Tan, CeO, alliance Global Group Tang,accepted general manager, savoy Hotel Manila; Lourdes JuneOne 27,Hotels said Group they provided proposed byInc.; theLorenzo DA and Gutierrez-alfonso, chiefloans operating Megaworld; dizon, Bases people Conversionlike and development authority; and stephen Reilly, million in to officer, farmers and Vinceby thepresident, Ati tribal the chief operating officer, Travellers International Inc. fishermen in distress, 10 fiberglass Tribal Organic Restaurant, Tribal boats, and vegetable farming tools Continued on A12

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Tax effort in Jan-May national govt cUts n-May 3rd-QUarterdomestic grows at record rate borrowings to p300b rd rate T

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national govt cUts 3rd-QUarter domestic borrowings to p300b

HE national government lowered its domestic borrowing program for the third quarter to P300 billion, on the back of robust collections of the main revenue agencies of the government. National Treasurer Rosalia V. de Leon cited the good performance of both the Bureau of Internal Revenue (BIR) and Bureau of Customs (BOC), as well as the successful retail Treasury bond (RTB) issuance earlier in the month. “[The lower amount is due to the] RTB and sustained good collection performance of [the] BIR and BOC,” de Leon said in a text message. Domestic borrowings in the form of Treasury bills (T-bills) and Treasury bonds (T-bonds) were lowered to P300 billion in the third quarter, coming from the P325 billion in the second quarter of this year. This showed a contraction of 7.6 percent. The government had set a domestic borrowing program

“[The lower amount is due to the] RTB and sustained good collection performance of [the] BIR and BOC.” —de Leon

of P240 billion for the first quarter of this year, awarding only P124 billion in the end. Broken down, P195 billion will be borrowed through Tbills and P105 billion through T-bonds, with the auction for T-bills happening on a weekly basis and the auction for Tbonds every fortnight. During the July-to-September period, the Treasury is set to have 13 auctions for three-month, six-month and one-year IOUs at an offer size of P15 billion. A total of seven auctions is set for T-bonds with an offer size of P15 billion each, as well with the tenors ranging from three, five, seven, 10 and 20 years. The national government See “Borrowings,” A2

DA pours in millions to turn ‘Bora’ into agro-tourism site

HE Department of Agriculture (DA) is turning Boracay Island into an agro-tourism site by pouring millions worth of interventions and facilities, which are expected to be operational when the area reopens to visitors in October. Agriculture Secretary Emmanuel F. Piñol said members of the Ati tribe, including farmers and fishermen, received a “bonanza” of government support, and this is expected to help them earn more income. Piñol, who was in Boracay on June 27, said they provided P1.950 million in loans to farmers and fishermen in distress, 10 fiberglass boats, and vegetable farming tools

and seeds to be planted on a portion of the 2.1-hectare ancestral domain area of the Ati tribe in Barangay Manok-manok. The DA also pledged to establish a solar-powered greenhouse, an organic restaurant, tribal vacation cottages made of indigenous building materials and a solar-powered irrigation system in the area, according to Piñol. All of these establishments could be operated and handled by the members of the Ati tribe. “The other projects which were proposed by the DA and accepted by the Ati tribal people like the Tribal Organic Restaurant, Tribal Continued on A12

peso exchange rates n Us 53.4820 n japan 0.4851 n UK 70.1416 n hK 6.8150 n china 8.1009 n singapore 39.1179 n aUstralia 39.2558 n eU 61.7985 n saUdi arabia 14.2615 china 8.1009 n singapore 39.1179 n aUstralia 39.2558 n eU 61.7985 n saUdi arabia 14.2615 Source: BSP (28 June 2018 )

Source: BSP (28 June 2018 )

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A2 Friday, June 29, 2018

DOT pushes marketing amid decline in Taiwanese arrivals By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

HE Department of Tourism (DOT) will be stepping up its promotions and marketing programs in Taiwan, after recent tourism arrivals reports indicated some sluggishness, and a new public survey showed the Philippines as an unpopular destination. In the first four months of 2018 , a r r iv a l s f rom Ta iw a n d ip p e d a l most 4 p e rce nt to 82,827, while the full-year 2017 arrivals report showed the Taiwanese tourists growing just by 3.3 percent to 236,777. DOT Spokesman and Undersecretary for Tourism Development Planning Benito C. Bengzon Jr. acknowledged the seeming letharg y in arrivals from Taiwan, despite its proximity to the Philippines. He explained that last year’s slowdown, in particular, could be attributed “to the security threats faced by the country, which, in turn, prompted the Taiwan Ministry of Foreign Affairs to issue a gray alert for the Philippines.” He stressed, however, that “gray is the lowest alert in Taiwan’s four-

color travel advisory, which only advises their citizens to ‘stay alert’ and ‘avoid large crowds.’” Bengzon, however, u nder scored that the DOT “is intensifying its promotional activities in Taiwan through advertisements, product presentations, and active participation in travel events,” to add ress t he slowdow n i n Taiwanese visitors. He also noted that the total number of Taiwanese tourists visiting other countries in 2016 grew by 10.66 percent. But the growth rate of Taiwanese visitors in the member-countries of the Association of Southeast Asian Nations was only 4.58 percent in the same year. “Despite the belowthe-curve growth rate of the overall Asean arrivals,” he added, “the Philippines performed extremely

we l l , reg i ster i ng 29 - percent growth—the highest among all the Asean nations,” to 229,303 tourists in 2016.

‘2nd most hated’–survey

As this developed, the Taiwan Public Opinion Foundation, in a survey released on June 17, ranked the Philippines (52.9 percent of total respondents) as the second most hated country after North Korea (70.9 percent). It also ranked the Philippines ahead of China (43.9 percent), South Korea (33.8 percent) and Russia (29.7 percent). The group, listed as a nongovernment and nonprofit institute specializing in opinion polls, did not say, however, why the Taiwanese felt negatively toward the Philippines. The results of this year’s survey remained unchanged from last year’s which also showed North Korea, the Philippines and China as the most unpopular among the Taiwanese. The 2018 poll, meanwhile, showed that Taiwanese had the most favorable opinion toward Singapore (88.2 percent of total respondents), followed by Japan (84.5 percent), Canada 82.3 percent) the European Union (74.8 percent) and the United States (70.6 percent). This year’s results were also the same as last year’s, except that Australia came in ahead of the United States as the most popular among Taiwanese.

DOT’s Tourism Attaché in Taipei Hazel V. Habito said in an e-mail that “generally, Taiwanese tourists consider the following relative to their choice of destinations: welldeveloped facilities, safety and security, accessibility, [they prefer] direct flights.” However, she noted that the Taiwanese prefer Japan as a tourism destination because of the latter’s “interesting culture particularly the food, scenery, and quality products as they love to shop,” and China, primarily because they speak the same language and have relatives on the mainland. She added that while the Taiwanese like “stress-free destinations” such as Boracay Island, they prefer Thailand and Vietnam “because the prices of Philippine tours compared to the two destinations are higher.” Javier underscored that DOTTa ipei has been ag g ressively promoting how fun it would be for Taiwanese to visit the entire Philippines, but noted that they are also marketing specific destinations, such as Iloilo, Guimaras, Bacolod and the Ilocos region. DOT-Taipei has also reintroduced golf as a major tourism activity, developing the MICE (meetings incentives, conventions and exhibits) market, aggressively promoting the Philippines as a venue to learn English as a second language, and “increasing our dive market and sporting events.”

Tax effort in Jan-May grows at record rate Continued from A1

“The national government revenues rose by 19.0 percent in the first five months of 2018 as the first phase of TRAIN took effect and tax administration improvements were enhanced, almost doubling nominal GDP [gross domestic product] growth which registered 9.7 percent during the first quarter,” the DOF bulletin added.

In December 2017 President Duterte signed into law the first package of the Comprehensive Ta x Reform Program (CTRP), which is now known as the TRAIN law. The law slashes personal-income tax rates while implementing offsetting measures such as increasing excise tax on fuel and sugar-sweetened beverages, among others, to make up for the revenue loss.

“Fisca l space ex panded by TRAIN and tax administration enabled government to boost investments and growth. Public construction expanded 25.1 percent in the first quarter, boosting GDP growth by 0.4 percentage point while government consumption rose 13.6 percent, contributing incremental 1.4 percentage points to growth,” it added. The DOF further pointed out

that the country’s strong macroeconomic fundamentals will continue to boost economic growth. “Strong macroeconomic fundamentals backed by tax reforms and the “Build, Build, Build ” program will continue to boost economic growth closer to the optimum 7 percent-to-8 percent level as the competitiveness of the economy rises and more jobs are created,” the DOF said.

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Con-com readies info blitz as poll shows little awareness of federalism By Bernadette D. Nicolas @BNicolasBM

OLLOWING the release of the Social Weather Stations (SWS) Inc.’s survey results showing that only 1 out of 4 are aware of the proposed federal system of government, the consultative committee (Con-com) said the results are “understandable” since the survey was taken from March 23 to 27 when Con-com had barely begun its job. Still, Con-com Spokesman Conrado I. Generoso admitted that there is still a lack of awareness on federalism and their proposals. He said the release of the survey is “very encouraging” since it showed a “very high” number of people who are undecided on whether they favor or not the federal system of government. “If we go out there and tell the remaining 34 percent of the people [they] will be convinced. They will be convinced that this is the way forward for this country,” Generoso said. “At least we are in a stage where the people are neutral to the result of the survey, which means they are open to hearing what we are proposing and they are open to changing their mind. That is what we are counting on when we go out there and tell the people about this.” Responding to the survey results, Presidential Spokesman Harry L. Roque Jr. said this means that the “information drive is not enough.” He added, “We’ll need to work harder given that the shift to federalism is the cornerstone of the Duterte administration.”

Info blitz

SWS also found out that 75 percent of the 1,200 respondents only learned about the federal system during the conduct of the survey. Thirty-seven percent favored the federal system of government while 29 percent opposed it. The remaining 34 percent were undecided. To address the lack of awareness about federalism and their proposals, Generoso said that they have identified measures to address this, such as conducting regional consultations and presentations where they gather people for feedback about their proposals, crafting nationwide information program, including the production of information materials and putting up a socialmedia page. Con-com has gone to Dumaguete and Baguio for the regional consultations and presentations and will go next to Legazpi, Butuan and Tacloban. Con-com member Susan Ubalde-Ordinario said that she finds it encouraging to go out and talk to people about federalism, especially when reactions of the people change from “slightly skeptical” to one indicating “enlightenment.” Ubalde-Ordinario added: “It’s very encouraging for us because we now know that with a little effort on our part to reach out to the public, I think we will be able to really convey the message and the importance and their responsibility to this whole thing. “We keep on telling them that as

Borrowings. . . Continued from A1

has a bor row ing prog ram of P889.51 billion for domestic and foreign lenders this year, with P176.26 billion coming from external institutions and P711.8 billion from the local market. Earlier in the month, the BTr had successfully issued P121.8 billion worth of three-year RTBs, coming from the good reception from the investing public during its offer

a committee we are recommendatory but at the end of the day, the power lies in their hands so what is important for them and for us is to understand what benefits it will bring to the country.” For his part, Con-com member Eddie M. Alih said that the results are understandable since only a few people have read the 1987 Constitution. But he is confident that this perception will change as they continue the regional consultations. He also stressed the importance of having the public appreciate that the shift to federalism will address the inequality of regions today. He said “there is no basis” for the fear of some people that the budget for federated regions will be diminished once the country shifts to a federal system of government. “There is no diminution of powers and the budget that the local governments have today. We are confident that the budget of regional government will be more under the federal form of government and they will already have the power to collect taxes and to retain what is intended for them,” he said. Meanwhile, the committee is also eyeing to convert the Office of the Ombudsman to a more powerful constitutional commission with a Chief Ombudsman and four Associate Ombudsmen. These four Associate Ombudsmen will be assigned for Luzon, the Visayas, Mindanao and National Capital Region. Under its proposed Federal Ombudsman Commission, there will be also be an overall Deputy Ombudsman for administration, Deputy Ombudsman for military and law enforcement and Deputy Ombudsman for every Federated Region. Generoso said this is to speed up the investigation and prosecution of cases and avoid “inordinate delay” and to give it more teeth to the fight against corruption. The Con-com is looking at having 18 federated regions. The committee has also proposed to increase the composition of the Commission on Audit under federal government, with the addition of a management expert. This is because Con-com is eyeing to expand the auditing powers of the COA by adding performance audits in its function aside from financial audit. This is to measure and assess not just compliance but also the outcome of programs, projects and expenditures. Under the proposal, there will be a Federal Civil Service Commission, Federal Commission on Elections, Federal Commission on Human Rights and Federal Competition Commission aside from a Federal Commission on Audit and Federal Ombudsman Commission. T he comm ittee is a l ready 100-percent done with its proposed draft federal constitution and is now making a final review for each provision. The final en banc vote for the entire draft is scheduled on July 3 and 4. The Con-com targets submission of the draft to the President on July 9. This is to give the President time to review the proposed constitution before his State of the Nation Address on July 23. period. Following the offer period from May 30 to June 8, the first offering of RTBs for 2018 was met with strong demand from the investing public with the total issue size more than four times higher from the initial planned issuance of P30 billion. Based on data from the Department of Finance, total government revenues from the Januaryto-May period reached P1.186 trillion, with the BIR contributing P827.7 billion and the BOC, P229.4 billion. Rea Cu

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The Nation

Lawmaker smells ‘something fishy’ in Sula’s recantation on PDAF case

ork-barrel scam whistle-blower Marina Sula’s change in her testimony against former Sen. Ramon Revilla Jr. is “highly suspect,” coming at this stage of the trial, a lawmaker said on Thursday. Akbayan Rep. Tom S. Villarin issued the statement after Sula backtracked on her 2014 testimony against Revilla on Thursday before the Sandiganbayan. “But it seems that under the Duterte administration, truth telling is not a virtue and may lead you to harm’s way,” Villarin said. “I’m afraid that it may also lead to recantations by other whistleblowers who are under intense pressure to let go of their testimonies. Fighting corruption now is not in vogue and reduced to just lip service,” the lawmaker added. During a recent hearing at the Sandiganbayan, Sula, then an employee of JLN Corp. of pork-barrel scam mastermind Janet Lim Napoles, denied her meeting with Revilla for the implementation of the senator’s projects funded by his Priority Development Assistance Fund (PDAF). Sula, after the direct examination of Revilla’s lawyer Reody Anthony Balisi, said she was only directed by the prosecution panel, particularly Joefferson Toribo, to corroborate the testimony of whistle-blower Benhur Luy. The prosecution claimed that Revilla illegally amassed P224 million of his PDAF. According to Sula, it was a standard operating procedure for Luy to sign the names of lawmakers in the endorsement letter which were also prepared in their office, and was in fact he who signed in the name of Revilla. She added that she personally saw Luy sign the documents without the knowledge of Revilla. With this, Associate Justice Edgardo Caldona warned Sula that she might lose her witness protection program because of her recantation. For his part, Revilla, in a news statement, said that “after four years, four long years, this...today’s revelations only confirm what I have known from the beginning—that I was targeted.” Revilla’s lawyers are now contemplating, asking the Court to exclude Luy from the witness protection program of the Department of Justice and revoke his immunity. Meanwhile, Deputy Prosecutor Manuel Soriano said Sula’s change in testimony was no longer a surprise as they have already information that she would change her testimony against Revilla. He, however, said, “We stand by other evidence presented by the prosecution, and with respect to the testimony given by her against Judge Toribio, we will never do that.” Jovee Marie N. dela Cruz

BusinessMirror

Editor: Vittorio V. Vitug • Friday, June 29, 2018 A3

Makabayan bloc slams House ‘foot-dragging’ on rights probe By Jovee Marie N. dela Cruz

@joveemarie

embers of the Makabayan bloc on Thursday slammed the leadership of the House of Representatives for sitting on several resolutions to investigate alleged humanrights violations under the Duterte administration, especially in Mindanao. The opposition bloc, in a news statement, said it filed many resolutions urging the House Committee on Human Rights, chaired by Rep. Cheryl P. Deloso-Montalla of the Second District of Zambales, to investigate the deaths of people who reportedly perished in the administration’s antidrug campaign, the kill-

ings of priests and activists, and the killings of peasant and lumad leaders in Mindanao. In the 16th Congress, the lawmakers said, they have conducted on-site hearings in areas where human-rights violations were committed. “Unfortunately, in the present Congress, even at the height of

‘Oplan Tokhang,’ ‘Oplan Kapayapaan,’ martial law and ‘Oplan Tambay,’ not one of these resolutions have been heard,” they added. The Makabayan bloc coalition in Congress is composed of Party-list Reps. Carlos Isagani Zarate of Bayan Muna, Antonio Tinio and France Castro of ACT Teachers, Emmi de Jesus and Arlene Brosas of Gabriela Women’s Party, Ariel Casilao of Anakpawis and Sarah Elago of Kabataan. “We have filed resolutions to probe the deaths of Kian de los Santos and Kulot who were killed in the antidrug campaign, the killings of priests and activists, and the killings of peasant and lumad leaders in Mindanao,” the statement said. “We have also filed resolutions to investigate violent dispersals of rallies and worker’s strikes. We have filed resolutions to probe the situation in Marawi and Mindanao and the

reported human-rights violations in the island, including the closures of alternative lumad schools. But not one of these various cases has been heard,” said the bloc. “We are calling on the House leadership to also look at the interests of human-rights victims and the exploited. We call on the leadership to immediately conduct hearings on the various resolutions that would look into their plight,” the bloc said. Earlier, the Makabayan bloc filed a resolution directing the House Committee on Human Rights and Committee on Muslim Affairs to conduct an inquiry on the government’s postMarawi siege rehabilitation projects, as these will be exempted from the required public bidding. It also filed another resolution directing the House Committee on Human Rights to conduct an investigation of the Philippine National Police’s “Oplan Tambay.”

Russia to send first designated defense attaché to PHL

ussian President Vladimir Putin on Wednesday signed an order to send his country’s first designated defense attaché to the Philippines, the Russian Embassy in Manila announced on Thursday. The move, according to the embas-

sy, signals Moscow’s determination to strengthen military and technical cooperation with Manila. According to Natalia Naumova, press attaché at the embassy, no specific person was designated yet. “It was the principal decision to establish

such position at the embassy. [We] will start working on it now as we have the frameworks,” she said. The Russian leader’s order comes more than a month after the Philippines sent its first defense attaché to Moscow. As per an earlier post by Philippine

Ambassador to Russia Carlos Sorreta, Col. Dennis Pastor was with his administrative assistant T/Sgt. Pablito Igne when he reported for duty in May 2018 as head of the Office of Defense Attaché in the Philippine Embassy. PNA

A4 Friday, June 29, 2018 • Editor: Vittorio V. Vitug

DOTr to blacklist bidders with pending cases vs govt

he transportation department has moved to blacklist companies and entities that have pending cases against the state from bidding for government projects, a ranking official said on Thursday. Transportation Undersecretary for Legal Affairs and Procurement Reinier Paul Yebra, in a news statement issued on Thursday, said the Department of Transportation’s move against such groups is in line with the Government Procurement Reform Act for a streamlined bidding process. “ We a re ju s t e mplo y i n g common sense —if t hey have cases lodged aga inst t he gover nment, why wou ld we a l low t hem to ma ke money out of gover nment cof fers? ” Tra nspor t at ion Secret a r y A r t hu r P. Tugade st ated. T he agency has yet to release a m a ster l i st of bl ac k l i ste d compa nies. “Prospective bidders who want to do business with the government must have a clean record, and must have a history of good dealings with the government. It’s

that simple,” he said. Yebra noted that the agency is “duty-bound to ensure that all prospective bidders are properly screened toward the goal of preventing opportunities for corruption in the government.” With the release of the memo banning companies with cases against the government, all prospective bidders are required to submit a certification, under oath, proving that they have no pending case/s against the government. This certification shall be included in the bid data sheet of bidding documents that the department requires for all its projects. “Failure of a bidder to comply with the requirement or submission of a false certification shall constitute a ground for automatic disqualification,” Yebra said. The disqualification of prospective bidders with pending cases against the government is one of the reforms that the agency is employing to promote good governance and transparency in the agency’s bidding and procurement processes. Lorenz S. Marasigan

Senator lauds IMO creation to operate power spot market By Butch Fernandez @butchfBM

en. Sherwin T. Gatchalian foresees brighter prospects for consumers follow ing the creation of a long-awaited independent body that will operate the wholesale electricity spot market (WESM) as mandated under the Electric Power Industry Reform Act (Republic Act 9136), also known as the Epira law. Citing nearly ten years of delay, Gatchalian on Thursday noted that the Department of Energy finally moved to institutionalize an independent market operator (IMO) that will handle the electricity market. “This is a welcome development in the government’s efforts to fully implement Epira, and attain its proconsumer objectives,” the senator said, adding that “the Filipino consumer can expect more reliable management and administration of the electricity market through the IMO.” Gatchalian, who chairs the Senate Committee on Economic Affairs, recalled that before the IMO’s creation, the Philippine Electric Market Corp., through its Philippine Electric Market Board— composed of representatives from the government, generation companies, transmission utilities and distribution utilities—conducted both the operations and governance functions of WESM. “The formation of an Indepen-

dent Market Operator would ensure greater independence in the operations of the country’s electricity market, ultimately benefiting Filipino consumers because the IMO board is composed of individuals who are not connected to the government or to any electric power industry player,” Gatchalian pointed out. In a news statement, the senator noted that the IMO is expected to operate and administer the WESM, and allocate resources for that purpose, adding that it shall also determine the dispatch schedule of all facilities, and monitor daily trading activities in the market. “Moreover, it shall oversee transaction billing and settlement procedures, and shall maintain and publish a register of all WESM participants,” Gatchalian added. At the same time, the senator hailed the appointment of lawyer Francis Saturnino Juan as the IMO’s first chairman, president and chief executive officer, citing Juan’s in-depth knowledge of the energy sector, having served as former executive director of the Energy Regulatory Commission and the chief operating officer of the IMO Transition Committee. Also named as IMO board members were Jose Mari Bigornia, Caroll Tang, retired Lieutenant Gen. Ralph Villanueva, Richard Nethercott, Johnny Tuason and Jose Rodelio Mangulabnan.

Economy BusinessMirror

Government asked to also require health warning on ‘sweetened’ food

By Elijah Felice E. Rosales

@alyasjah

everage makers are asking the government to include packaged snacks highly reliant on sugar in the plan to put health warnings on sweetened food, according to the country’s trade minister.

Trade Secretary Ramon M. Lopez said drink manufacturers had opposed putting health warnings on sugar-sweetened beverages (SSBs). He said it might further weaken the demand for SSBs, product that were slapped with additional taxes under the Tax Reform for Acceleration and Inclusion (TRAIN) law. Lopez said the beverage industry is against putting the words “warning” or “caution” in the labels of sugar-based drinks, fearing that this may weaken further demand, he said in a text message to reporters. “We emphasized that we are not really taxing, but more to raise consciousness of consumers on sugar content…more of making more prominent the sugar content of the product. [This is] similar to calorie content in labels,” Lopez said. The Department of Trade and In-

dustry held a meeting with the Food and Drug Administration (FDA) and the beverage industry to discuss how to go about President Duterte’s desire to put health warnings on SSBs. The policy is intended to inform buyers how much sugar they will be taking in when consuming SSBs. In the meeting, beverage makers demanded the government to not only warn consumers of the sugar content in drinks but also in packed food. “Sugar in beverage supplies energy requirement of Filipinos. The labeling requirement must also cover packaged food, according to the beverage industry,” Lopez said. Confectionery items, such as candies and chocolates, make use of sugar as main ingredient. On the average, the staple constitutes about 60 percent of their content.

@reneacostaBM

fficials destroyed on Thursday at least P11.8 million worth of counterfeit items that were among those seized in the continuing campaign of the government against violations of the intellectual-propert y r ig ht s (IPR). The ceremonial destruction of confiscated pirated goods that

included luxury bags, shoes, apparels, digital video discs, medicines and lubricants by IPR officials led by Intellectual Property Office (IPO) Director General Josephine Santiago took place at Camp Crame. The destroyed products were among the P6.7 billion worth of fake goods that were hauled in by different law-enforcement agencies under the National Council on Intellectual Property Rights (NCIPR) during the first five months of his year. “The significant surge in seizures in the first five months of the year is a testament to the sustained effort and determination of the NCIPR to tackle the ills of piracy and counterfeiting,” Santiago said, adding the hauls were also a result of a strengthened enforcement efforts. The five-month figure represent-

“It was noted that sugar per se is not bad, especially if taken in moderate quantity. It is a source of energy and calories needed for the day,” the trade chief added. As an alternative to health warnings, beverage makers want to put instead the sugar and calorie content of their products, as long as strong words are not used in the label. “But we have to still determine which products should have a front label ‘high in sugar’ and indicate the sugar content,” Lopez added. As of recent consultation, the government is amenable to the alternative proposed by beverage makers. “Our studies will continue and consultations with technical agencies like [the] FNRI [Food Nutrition Research Institute], NNC [National Nutrition Council] and [the] FDA. Whatever the decision, we will set a transition period to allow them to use up current packaging,” Lopez said.

Sugar in beverage is generally a low source of sugar and calories in a day, usually around 3 percent only, the trade chief said, citing beverage makers. Other nonbeverage products that are major sources of sugar are rice, bread, carbohydrates and other food products. Health warnings on SSBs could be another weight on the shoulders of beverage makers who had to carry the cross of additional taxes on SSBs imposed by the TRAIN law, which slapped a P6-per-liter tax on drinks containing caloric or noncaloric sweetener, and a P12per-liter duty on beverages with high-fructose corn syrup. Lopez said the beverage industry “could be” affected by the new policy of the government, but argued demand for SSBs will not go down. He said the cheaper price of powdered juice as against soft drinks will make it survive the changes on SSBs.

We emphasized that we are not really taxing, but more to raise consciousness of consumers on sugar content…more of making more prominent the sugar content of the product. [This is] similar to calorie content in labels.”—Lopez

PSA digs deep into child poverty-incidence data By Cai U. Ordinario

@cuo_bm

AT least P11.8 million worth of goods were destroyed—with the use of a police armored personnel carrier—during the ceremonial destruction of counterfeit and pirated goods at Camp Crame in Quezon City. NONOY LACZA

Seized counterfeit goods destroyed at Camp Crame By Rene Acosta

www.businessmirror.com.ph

ed 80 percent of the total seizure of the government last year, which stood at P8.2 billion. The IPO said the P6.7-billion haul would even increase as soon as it would complete reports from other NCIPR members, such as the National Bureau of Investigation, the Food and Drugs Administration and the Optical Media Board. Based on the record of the IPO, fake cigarettes and cigarette paraphernalia, which included packing machines, raw materials, filters and stamps, topped the list of seized counterfeit and pirated products from January up to May this year. “Of the additional P1.4 billion worth of fake goods captured in April and May, P1.3 billion were again fake cigarettes and cigarette paraphernalia,” the agency said.

IPO Deputy Director General Teodoro Pascua said the apparent trend in the spread of counterfeit cigarettes could be due to market demand borne by the rising prices of genuine cigarette products. It could also be a “product of the private sector’s more proactive reporting of counterfeiting activities in cigarettes,” he said. Following the seized cigarette products were hand bags and wallets and optical discs. Santiago said that the IPO is exploring alternative solutions in addressing the problem of piracy and it includes holding developmental meetings with involved sectors and government units. This is aside from the intensified enforcement operations against pirates and other IPR violators.

he Philippine Statistics Authority (PSA) will soon be collecting child poverty data every two years to better monitor the country’s efforts in improving the lives of millions of Filipino children nationwide. Addressing child poverty is one of the targets under Goal 1 of the Sustainable Development Goals, which aims to end poverty worldwide by 2030. Currently, child poverty data is collected every three years, which prevents better monitoring of the country’s progress in lifting millions of Filipino children from poverty. “Child [below 18 years old according to Republic Act 7610] poverty stats [incidence] is the proportion of children belonging to poor families to the total number of children,” National Statistician Lisa Grace S. Bersales told the BusinessMirror. “Major data gaps [include] absence of lower-level geographic disaggregation, disability status, informal sector; frequency is every three years; existing official income poverty estimates cannot give a measure of deprivations on basic needs,” she added. Apart from the frequency, Bersales

said the PSA will also implement improvements in methodology to child poverty statistics. This will make the data a more reliable basis for the country’s small area estimates for municipal poverty statistics. Bersales said the 2020 census will also include disability questions, which will serve as inputs in coming up with estimates by disability status. The PSA will also generate informal sector and employment data, as well as study the development of multidimensional poverty index to identify deprivations on basic needs. Based on the latest PSA data on children, there are a total of 38.36 million children in the Philippines. This is composed of 19.78 million boys and 18.58 million girls. Child poverty is composed of multiple deprivations. In 2013 11.6 percent of children experienced severe deprivation in education; 11.1 percent, shelter; 9.7 percent, sanitation; 9.1 percent, information; and 0.3 percent, water. This means children aged 6 to 17 years old are not educated; their shelter has no floor material; they have no toilet/field/bush; they have no radio, television, landline telephone, cellular phone and personal computer; and do not have access to water, even to rivers/streams/ponds/lakes.

MMDA to launch mobile app on traffic and flood updates

he Metropolitan Manila Development Author it y (MMDA) is eyeing to develop a mobile app that will provide realtime traffic updates, flood alerts and information on disaster and emergency preparedness. The MMDA has signed a memorandum of agreement on Thursday with MediaQuest Holdings Inc. to deliver vital information to the public using information technology. The MMDA and MediaQuest will develop a mobile application that will provide access to traffic situation along major roads in Metro Manila that will enable motorists and commuters to plan their trips.

The app will also deliver information related to road conditions, road repairs, floods, Pasig River Ferry System and other public-transport schedule, earthquake preparedness updates, and other useful information. “I am sure this platform will help prevent the spread of disinformation and help increase public’s participation at a higher level,” MMDA Chairman Danilo D. Lim said during the signing ceremony. “Our interest is to involve the public in the government’s programs. With media’s effectiveness and credibility at hand, we hope to develop a culture of vigilance leading to an involved citizenry,” he added. PNA

Agriculture/Commodities BusinessMirror

www.businessmirror.com.ph

PHL regains bird flu-free status

By Jasper Emmanuel Y. Arcalas

@jearcalas

he Philippines has officially regained its bird flu-free status following the publication of its “self-declaration” report on the web site of the World Organisation for Animal Health (OIE) on Thursday. Manila, through a follow-up report, has formally informed the OIE that it has totally eradicated the avian influenza (AI) virus that struck Central Luzon nearly a year ago. The fifth and final follow-up report by the Philippines since the outbreak of AI in Central Luzon was submitted by Agriculture Assistant Secretary for Livestock Enrico P. Garzon on June 27. “There are no new outbreaks in this report,” it read. “The event is resolved. No more reports will be submitted.” The report indicated that the AI outbreak that hit quail and layer farms in the provinces of Pampanga and Nueva Ecija was resolved on March 9. The bird-flu outbreak was confirmed on August 7, 2017. It started as early as July 24, 2017, in two poultry

farms in San Luis, Pampanga. However, the Philippine report also indicated that the source of the Central Luzon AI outbreak is still “unknown or inconclusive” to date. This is the first confirmed birdflu outbreak in the history of the Philippines. Manila had been free from avian influenza before the virus hit farms in Pampanga last year. The report enumerated the measures implemented by the Philippines in eradicating the AI virus, which include traceability, quarantine, official destruction of animal products, official disposal of carcasses, byproducts and waste, stamping out, control of wildlife reservoirs, zoning and disinfection. The Philippines also undertook procedures to deactivate the pathogenic agent in products or by-products and ante and

postmortem inspections. The Department of Agriculture (DA), through the Bureau of Animal Industry (BAI), is set to apply the following measures: movement control inside the country, surveillance within and outside the containment and/or screening procedures. The Philippines recorded four bird-flu outbreaks across Pampanga and Nueva Ecija, which resulted in the deaths of 73,357 birds. The government culled a total of 407,840 susceptible birds in San Luis, Pampanga, and the municipalities of Jaen, San Isidro and Cabiao in Nueva Ecija. The publication of Manila’s report on its AI status means local producers could now resume the export of Philippine poultry. Since the AI outbreak in August 2017, the Philippines has been banned from shipping poultry products to South Korea, Japan, the United Arab Emirates and Saudi Arabia. “Local poultry products are still barred in other countries. Our trading partners are still awaiting our report to the OIE,” BAI National Veterinary Quarantine Services Division chief Florence D. Silvano told the BusinessMirror in April. Once the Philippines is declared as bird flu-free, Silvano said the DA through the BAI, could request its trade partners to lift the import ban imposed on local poultry.

Editor: Jennifer A. Ng • Friday, June 29, 2018

UPLB confers honorary doctorate degree on Villar

en. Cynthia A. Villar was awarded an honorary doctorate by the country’s premier school in agricultural studies during the 46th Commencement Exercises of the University of the Philippines Los Baños (UPLB). Villar, chairman of the Senate Committees on Agriculture and Food and on Environment and Natural Resources, was recognized by the UP Board of Regents for her achievements in the fields of agricultural development, poverty alleviation, education and upholding the welfare of women and children. Dr. Fernando Sanchez, chancellor of UPLB, said Villar is being recognized “for her commitment to public service and dedication to the welfare of the Filipino people.” In receiving the degree of Doctor of Laws, honoris causa, Villar said “it is truly an honor and privilege that you all deem me worthy of this recognition.” “Rest assured that as a public servant, I will continue to serve our fellow Filipinos and our country in the best of my abilities and capabilities,” she added. Villar also announced her family’s donation of a professorial chair to UPLB College of Agriculture for small farm management. The conferment of the honorary degree upon Villar was witnessed by her husband, former Senate President Manny Villar, and children— Paolo, Vista Land chief executive officer; Mark, secretary of the Department of Public Works and Highways; and Camille, All Home Store president. Villar, when she was elected repre-

sentative of Las Piñas, was chairman of the House Committee on Higher and Technical Education and led the passage of 28 bills promoting highquality education. As a senator, she authored the Open Learning and Distance Education Act of 2014 and the Ladderized Education Act of 2014. She also pushed for the enactment of Republic Act (RA) 10931, or the law granting free college education in all state universities and colleges, local tertiary schools and institutions accredited by the Technical Education and Skills Development Authority (Tesda). Villar values education and training so much that in her legislative initiatives, she has included provisions that grant scholarships to help improve the income and competitiveness of farmers and fishermen. In RA 10848, or the law extending the life of the Agriculture Competitiveness Enhancement Fund, around P500 million was allocated to be used for a comprehensive scholarship and attractive grant-in-aid program for agriculture, forestry, fisheries, and veterinary medicine education. She also pushed for the allocation of P750 million by Tesda to fund scholarships in farm schools and agriculture-related courses. After the enactment of RA 10816, or the farm tourism law, which she principally authored, Villar said there are now 1,955 farm schools and learning sites all over the country, enabling farm owners to improve their income and, in the process, train farmers in the community on modern agricultural techniques and agribusiness. Villar’s work through the Villar Social Institute for Poverty Alleviation

and Governance, which provided livelihood opportunities to farmers and fishermen, provided assistance to migrant workers and their families, and promotes rehabilitation of coastal communities, was also among the achievements cited by the university. In her commencement speech, Villar said her legislative initiatives are designed to help eradicate the barriers to the agriculture sector’s competitiveness and profitability, such as the lack of technical expertise, inadequate access to socialized credit and lack of mechanization and financial literacy. She also encouraged the graduates to “think about the plight of our poor countrymen in the agriculture sector and rural communities.” “There are a lot of exciting opportunities and untapped potential in the agriculture sector. At hangad ko na kayong mga kabataan ay magiging bahagi niyan, that you will be the ones to tap into that potential,” she said. Villar was also recipient of a number of honorary degrees, including the Doctor of Philosophy in Rural Development from the University of Southern Mindanao, and Doctor of Humanities from Bataan Peninsula State University and Tarlac Agricultural University. She was also conferred the degree of Doctor of Laws from the Philippine Women’s University in recognition of her contribution in poverty alleviation, women’s rights, good governance, environmental issues and varied humanitarian undertakings. Last year Villar was recognized as Most Distinguished Alumna by the University of the Philippines.

BusinessMirror

A6 Friday June 29 2018 SICHUAN AIRLINES CO, LTD CONDITIONS OF INTERNATIONAL CARRIAGE FOR CARGO

Statement of the General Manager General Conditions of International Carriage for Passengers and Baggage of Sichuan Airlines is developed in accordance with Montreal Convention, Civil Aviation Regulations on International Carriage for Passengers and Baggage, Operation Certification: Large Airplanes Air Carrier (CCAR-121), Dangerous Goods Regulations and other current applicable laws, rules and regulations. General Conditions are one part of the contract of international cargo transport of Sichuan Airlines, the regulatory document at company level of Sichuan Airlines, and the described guidelines, policies, provisions and standards of international cargo transport are the tenet and criteria all staff and ground service agent must abide by in ticketing and ground service of international cargo transport. Each department and person engaged in international cargo transport, including branch, sales department, representative office and ground agent, must strictly follow and carry out the General Conditions. The issuance of General Conditions will instruct and improve the standardization, normalization and programming of the international cargo transport of Sichuan Airlines, and ensure constant improvement of flight operation safety, regularity and service of Sichuan Airlines. Sichuan Airlines General Manager: 01/12/2017 Table of Contents Chapter 1 Definitions Chapter 2 Applicability Chapter 3 Cargo Shipping Chapter 4 Air Waybill Chapter 5 Rates, Freight Charges And Other Charges And Fees Chapter 6 Shipment In Course Of Carriage Chapter 7 Delivery of Shipment Chapter 8 Carriage of Special Cargo Chapter 9 Charters Chapter 10 Claim, Liability and Indemnity Chapter 11 Legal Action Chapter 12 Effectiveness, Modification and Interpretation

01 04 05 10 11 14 19 22 24 25 30 31

CHAPTER 1 DEFINITIONS Art. 1 Definitions Except as otherwise provided herein, the implications of the below definitions in Conditions of International Carriage for Cargo of Sichuan Airlines hereinafter refers to: (1) CARGO Anything carried or to be carried in an aircraft except mail, and baggage carried under a passenger ticket and baggage check, but includes baggage moving under an air waybill. (2) INTERNATIONAL AIR TRANSPORT Any transport in which, unless otherwise stipulated by the convention, according to the contract of transport by air between the parties, the place of departure, the place of destination or agreed stopping place, whether or not there be a break in the transport of a transshipment, is not situated within the territory of the People’s Republic of China. (3) SHIPPER’S LETTER OF INSTRUCTION Shipper’s letter of instruction refers to the written file provided to the carrier, for the purpose of completing the air waybill when the consignor entrusts the carrier to fill in the air waybill. (4) AIR WAYBILL The air waybill made out by or on behalf of the shipper which initially evidences the transport contract between the shipper and carrier(s) for carriage of goods on the flights of the carrier(s). (5) SHIPMENT One or more packages, receipted for under a single air waybill, for carriage to one consignee at one destination address. (6) CARRIER Carrier refers to the air carrier including Sichuan Airlines that lists the airline code on the air waybill or the personnel or organization agrees to provide any services related to such air transport. (7) CONTRACTING CARRIER Any carrier who has concluded a contract of transport by air in his own name with a shipper. (8) ACTUAL CARRIER Any carrier to whom the performance of the whole or part of the transport has been authorized by the contracting carrier. (9) AGENT The individual or organization specifically authorized to act in the name of or on behalf of carrier or shipper in relation to the carriage of cargo. (10) SHIPPER The person or organization whose name appears on the air waybill or shipment record, as the party contracting with carrier for the carriage of cargo. (11) Consignee The person or organization whose name appears in the consignee column of the air waybill, and the carrier instructs whom to deliver the shipment. (12) DAYS Days refer to calendar days, including Sunday and public holidays; the day on which the transport document is signed, the day of flight departure, or the day of publishing notice is not included when validity period is determined. (13) Advance payment It refers to all fees related to the cargo transport that the shipper needs to pay for when shipping the cargo in line with the cargo transport contract. (14) Freight to collect It refers to the fees related to the cargo transport that the consignee needs to pay for when receiving the cargo. (15) Charters The shipper contracts all the shipping space of the aircraft to transport cargo. (16) Special Drawing Right—SDR It’s also called paper gold, which is a reserve asset and unit of account established by the International Monetary Fund. (17) Continuous transport It refers to the business that several carriers implement the transport in line with the Air Cargo Transport Contract, no matter it’s one contract or more than one contracts this business is a single transport that cannot be divided. (18) Code sharing The flight number (code) of one airlines can be used on the flight of another airlines. (19) Convention It refers to the following applicable documents. Convention for the Unification of Certain Rules for International Carriage by Air (Warsaw Convention for short) signed at Warsaw on 12th, Oct. 1929. Revision of the Convention for the Unification of Certain Rules for International Carriage by Air Signed At Warsaw On 12th, Oct. 1929 (Hague Convention for short) at Hague on 28th, Sept, 1955. Convention for the Unification of Certain Rules for International Carriage by Air (Montreal Convention for short) signed at Montreal on 28th, May, 1999. (20) Laws and rules Refer to the laws and regulations of the departure country; transit country and destination country; the regulations and orders of the local authority and related rules of the carrier. CHAPTER 2 APPLICABILITY Art. 2 Applicability (1) These conditions shall apply to the international carriage of cargo, including all services incidental thereto, performed by Sichuan Airline for remuneration. (2) Unless otherwise specified by the law and rules, this will be followed by the air transport of cargo among China main land; Hongkong; Macau Special Administrative Region and Taiwan Area. (3) Except as otherwise provided in the conditions, contract and air waybill of gratuitous carriage, therse conditions shall also apply to the gratuitous carriage which accepted by Sichuan Airlines. (4) With respect to carriage of cargo performed pursuant to a charter agreement, these conditions shall only apply to the conditions contained or referred to in such charter agreement and provisions of air waybill. (5) In the event of contradiction or inconsistency between these conditions and the applicable laws or rates rules of Sichuan Airlines, the latter shall prevail. The rest provisions of these conditions shall remain effective. (6) Except as otherwise provided, in case of divergence between these conditions and the provisions contained in the regulations of cargo transportation of Sichuan Airlines, these conditions shall prevail. (7) As for the carriage of mail, follow the agreement and treaty between governments, if there is any. These conditions are not applicable. (8) SCAL agent; employees or the representatives have no right to change, revise or abandon any items of this section. (9) For some flight routes, Sichuan Airlines operates cargo transport or the cargo transport entrusted by other carrier through code-sharing flight. This means that even though the shipper books Sichuan Airlines’ flight and holds the air waybill of Sichuan Airlines, the cargo shipped may be actually transported by another carrier. Under this circumstance, these conditions are also applicable for cargo carriage. CHAPTER 3 ACCEPTABILITY OF GOODS FOR CARRIAGE Art. 3 General (1) The Shipper is obligated to comply with applicable international conventions, national laws, government regulations of any country flown from, to, or over. (2) Subject to national laws and government regulations of any country flown from, to, or over, the shipper shall be obligated to comply with the formalities required by customs and other government authorities. (3) The shipper is obligated to comply with relevant regulations of SCAL related to the transportation of cargo. (4) The cargo to be transported shall be in compliance with the following conditions: 1. The transportation, the exportation or importation thereof is not prohibited by the laws or regulations of any country to be flown from, to or over; 2. They are packed in a manner meeting the requirements of carriage by air; 3. They are accompanied by the requisite and effective shipping documents; They are not likely to endanger aircraft , persons or property; They are not likely to cause annoyance to passengers. Art.4 Responsibilities of the Shipper The shipper shall be liable for any loss which may be caused thereby to SCAL or to any other person to whom SCAL is liable, by reason of the shipper’s violation of applicable laws, government regulations, orders and requirements. The shipper shall furnish such information and documents as am necessary to meet the formalities provided by laws and administrative rules and regulations before the cargo can be delivered to the consignee. The shipper shall be liable to SCAL for any damage occasioned by the absence, insufficiency or irregularity of any such information or documents, unless the damage is due to the fault of SCAL, his servants or agents. SCAL is under no obligation to inquire into the correctness or sufficiency of required information or documents unless otherwise provided by laws and administrative rules and regulations. (3) The shipper shall learn about cargo carriage related regulations and requirements of Sichuan Airlines before shipment. The shipper shall be responsible for the losses of Sichuan Airlines or others due to his violation of these regulations or requirements. (4) When shipper undertakes to lead a unit lead device (ULD) he must comply with SCAL’ s loading instructions and shall be liable for and indemnify carrier against all consequences of any non - compliance with such instructions. (5) Joint liability a. The shipper is liable for paying off all the fees to SCAL. Ensure that fees the consignee rejected to pay for or cannot afford are paid, including collected freight; poundage of the collected freight; custody charge and etc. The shipper should also bear the cost that the cargo are transported back under his/her instruction. 2. The shipper should ensure to pay all the charges; fines and loss that SCAL and related carried borne, which are caused by the following reasons; (1) There are prohibited goods in the cargo shipped. (2) The restricted cargo does not satisfy the restriction condition. (3) The label; number; address and package or the name of the shipper cargo are incorrect or incomplete. (4) The loss; delay or error of the import and export license; the license or documents needed. (5) The actual name; weight and size of the cargo shipper are not equivalent with thoses on the cargo freight sheet. (6) The fines; detention or refusal to entry the emigration delivered by the local authority such as the custom; police or inspection and quarantine, which are caused by the shipped cargo or documents. Art.5 Packing

(1) The shipper shall adopt appropriate materials for interior and exterior packagings and pack cargo in proper condition suitable for air transportation in accordance with the nature, weight of goods. As for the valuable cargo, currency and cash with the risk of being robbed or stole, the shipper shall adopt neutral packing which does not show the cargo contained inside. (2) The shipper shall ensure that the packaging of consigned goods in course of carriage would not be out of shape, damaged, dispersed and leaked, and the packaging would not cause personal injury, damage and pollute aircraft, equipment or other cargo, baggage, and mail. (3) Each consignment must be packed with the material satisfying the laws and regulations of the country of departure, stop-over and destination during cargo shipment. Art. 6 Marking and Labeling (1) Each package must be marked on the outside of the package with information of airport of origin, destinations, name and address of shipper and consignee, and telephone number, etc.. The writing should be clear; legible and persistent. If the cargo shipped is dangerous goods, the shipper must mark on the outside of the package in line with the requirements of applicable law and regulations. (2) For the carriage of cargo, identification label(s) shall be affixed or attached to each package. (3) If the cargo shipper is special cargo then the special cargo label(s) and handling label(s) shall be affixed or placarded to the outside of the package according to the nature of goods. (4) Any irrelevant mark(s) and label(s) already on the package reused shall be removed or obliterated to ensure fast, safe and accurate transport. Art. 7 Weight and Dimension (1) The unit of measurement of weight is kilogram, and the minimum rounding off unit is 0.1 kilogram. (2) Consignments, the extreme dimensions of which result in an average of more than 6000 cubic centimeters per kilogram, shall be calculated with 6000 cubic centimeters equaling to 1 kilogram. (3) SCAL may define the limits of weight and dimensions of cargo by routing, aircraft types, and airport facilities of origin, transit and destination. (4) The sum of length, width and height for each package shall not be less than 40 centimeters. If the size is smaller than this , the shipper should amplify the package. Art. 8 Declared Value (1) Declared Value refers to a special declaration of interest which a shipper has made to Sichuan Airlines at the time when cargo was handed over in delivery at destination. The declared value should be filled in corresponding column of the cargo freight sheet. (2) Except as otherwise provided, declared value for carriage of each air waybill shall not be in excess of USD 100,000 or its equivalent. (3) The waybill will be effective after the signature of both sides. The shipper cannot propose any change for the declared value filled on the waybill. (4) When the declared value exceeds 19 per kilogram SDRs or the equivalent money, the extra charge for the declared value should be paid. (5) SCAL has the right to decide the value limit of the cargo. If the declared value of the cargo exceeds the limit stipulated by SCAL, SCALwill request the shipper to exercise partial shipment or other safe measures. If the shipper does not exercise partial shipment or other safe measures, SCAL has the right to refuse the transport. Art. 9 Reservation Reservation shall be made in advance by the shipper if he consigns the urgent goods, special cargo, and cargo needing special handling. CHAPTER 4 AIR WAYBILL Art. 10 Air Waybill (1) An air waybill shall comprise of three originals, and nine copies. The three originals bear on the reverse the conditions of contract and have the same validity. Original 1 shall be for the issuing carrier, Original 2 shall be for consignee, and Original 3 shall be for the shipper. Ail air waybill is a nonnegotiable document, and a negotiated air waybill shall be invalid. (2) The shipper or his/her agent shall make out an air waybill, and shall deliver such air waybill to carrier simultaneously with the cargo. Upon the request of the shipper or his/her agent, the carrier may make out an air waybill, he shall be deemed, subject to proof to the contrary, to have done so on behalf of the shipper. After the waybill is filled, the shipper and SCAL should both sign or stamp before it come into force. (3) The shipper is responsible for the correctness, accuracy and completeness of the particulars and statements relating to the cargo which he inserts in the air waybill. The shipper shall indemnity the carrier against all damage suffered by him, or by any other person to whom the carrier is liable, by reason of the irregularity, incorrectness or incompleteness of the particulars and statements furnished by the shipper. (4) Air Waybills, the writing on which bas been altered or erased, need not he accepted by carrier. (5) If the particulars and statements inserted by shipper are incorrectness or incompleteness, SCAL may be authorized to complete or correct the air waybill or particulars or statements to its best ability without being under any obligation to do so. (6) Carrier has the right to require the shipper to make out separate air waybills when there is more than one package. (7) If the package of the shipped cargo has obvious defect, the shipper should annotate it on the waybill clearly, or else SCAL will request the shipper to annotate it again on the waybill or authorize SCAL to revise or re-annotate for him/her. If the waybill delivered with the cargo does not cover all required details or the details are not correct, the shipper can authorize SCAL (SCAL has no obligation) to supplement or revise the waybill as far as possible. CHAPTER 5 RATES, FREIGHT CHARGES AND OTHER CHARGES AND FEES Art. 11 Rates (1) The Rate is the amount charged for the carriage from the airport of departure to the airport of destination of a unit of weight (kg. or lb. ). (2) Rates will be used subject to the rules and conditions published in Sichuan Airlines’s regulations and rate tariffs. Art. 12 Freight Charges and Other Charges and fees (l) The Freight Charges governed by these conditions are those duly published by carrier and in effect on the date of the issuance of the air waybill by SCAL, and it is the amount to be calculated by multiplying the applicable rate per kg/lb by the chargeable weight, excluding charges of surface transportation, and other expenses between airport and municipal districts and between two airports at the same city. (2) Other charges and fees refer to the money that needs to be paid to SCAL when the shipper consigns the cargo or the consignee receives the cargo, which refer to all other fees related to the cargo transport except for the air transport fees and the extra charge of the declared value. Unless otherwise declared, the charges and fees should include but not limited to the following: 1. Service of cargo claim; cargo delivery form or to the airport or the cargo station in downtown that SCAL provides service. 2. Storage fees. 3. Insurance fees. 4. Service fees of freight collect. 5. Customs charges. 6. The charges or fines that the responsible institute requests including the customs duty. 7. The charges caused by the fix (SCAL) of package which is not in good condition. 8. The fees of reloading the cargo or the transport fees caused by the return of cargo in other forms or return to the departure station. 9. Extra fees. 10. Other similar service or charges. Art. 13 Payment of Freight Charges and Other Charges and Fees (1) The payment for the charges and other charges shall be made in the currency acceptable to SCAL. (2) All prepaid charges and other charges applicable to a prepaid shipment shall be paid by the shipper. Charges collect shipments will be accepted only when they are in full compliance with laws and regulations of state of destination and rules of SCAL. All charges and other charges collect to a collect shipment shall be paid by the consignee. (3) Full applicable charges, whether prepaid or collect, and other charges shall be deemed fully earned by SCAL, whether or not the cargo is lost or damaged, or fails to arrive at the destination specified in the air waybill. (4) The shipper shall also guarantee payment of all costs, expenditures, fines, penalties, loss of time, damage and other sums which SCAL may incur or suffer by reason of the inclusion in the shipment of articles the carriage of which is prohibited or restricted by law, or the illegal, incorrect or insufficient marking, numbering, addressing or packing of packages or descriptions of the cargo, or the absence, delay or incorrectness of any export or import license or any required certificate or document, or any improper customs valuation, or incorrect statement of weight or volume. (5) SCAL shall have a lien on the cargo in the event of non-payment until the shipper or the consignee pays for the freight charges and other charges and fees. SCAL shall have the fight to dispose of the cargo in the case of non- payment, provided that prior to such disposition carrier shall inform the shipper or the consignee addressed in the air waybill. Except as otherwise provided in the regulations of customs and other Government authorities, SCAL shall have the right to dispose of the cargo to be had a lien upon at public or private sale, and to pay itself out of the proceeds of such sale any and all such amounts. No such sale shall however, discharge any liability to pay any deficiencies, for which the shipper and the consignee shall remain jointly and severally liable. (6) The shipper and the consignee shall guarantee payment of all charges, other charges, taxes, and advances of SCAL, and remains jointly and severally liable to indemnify such charges. (7) SCAL may cancel the carriage or the delivery of the shipment upon refusal by the shipper to pay the charges and other charges. Art. 14 Adjustments in rates and other charges Rates and other charges, which have been adjusted, will not be applicable for the air waybill issued. CHAPTER 6 SHIPMENTS IN COURSE OF CARRIAGE Art. 15 Acceptance of Cargo (1) Carrier shall comply with applicable laws, government regulations, orders and requirements in the event of acceptance of cargo. 1. Carrier shall not accept the cargo prohibited by the applicable laws, government regulations, orders and requirements. 2. Carrier shall not accept the cargo which needs to accomplish the formalities of quarantine and inspection required by applicable laws and government regulations, orders and requirements before these formalities have not been fulfilled. 3. Sichuan Airlines will not accept the shipment which is out of handling capability and storage capability of Sichuan Airlines. (2) Sichuan Airlines will implement security check over shipped cargo as per regulations of administrative authority. When necessary, Sichuan Airlines will open the case to check the cargo and related documents or files, and the shipper has the obligation to assist Sichuan Airlines. Sichuan Airlines reserves the right to implement security check over the cargo consigned, cargo packaging, and related documents and files, but Sichuan Airlines shall be under no obligation to implement compulsory check. Carrier shall implement a security inspection or maintain other security procedures. Art. 16 Routings (1) Carrier shall undertake to carry the cargo with reasonable and rapid dispatch. (2) Carrier assumes no obligation to carry the cargo by any specified aircraft or over any particular route or routes, or to make connections at any point according to any particular schedule, notwithstanding that the same may be stated in the air waybill. Art. 17 Cargo Transportation Time Limits (1) To ensure that shipped cargo can be timely transported, the shipper shall predetermine transport flight and date with Sichuan Airlines. With no special reasons (such as government acts and force majeure, etc.), if the shipper has agreed with Sichuan Airlines on the transport flight and date or transport time limit and so indicated in the air waybill, Sichuan Airlines shall carry the cargo as per agreements; with no agreements achieved, Sichuan Airlines shall carry the cargo within the reasonable time limits in accordance with the sequence of receiving shipped cargo.. (2) Carrier may determine the sequence of dispatch on the basis of the time agreed with the shipper or in the order of acceptance of the cargo. (3) Times shown in carrier’s timetables or elsewhere are approximate and not guaranteed, and form no part of the contract of carriage, and not regard as the time of commencement and accomplishment of the carriage and delivery of cargo thereto. Art. 18 Precedence of Transportation (1) Subject to applicable government laws, regulations and orders, SCAL is authorized to determine the priority of carriage as between shipments, and as between cargo and mail or passengers. When necessary, SCAL can continue the flight without transporting any cargo or part of the cargo. (2) If as a result of determining such priority prescribed in the preceding paragraph of this Article, cargo is not carried or carriage thereof is postponed or delayed or if any articles are removed from a shipment, SCAL will not be liable to shipper or consignee or to any other party for any consequences therefore. (3) In the event of determining such priority, SCAL shall consider profits of the shipper and arrange reasonable carriage for the cargo postponed or delayed. (4) In order to avoid damage or danger and with the permit of the customs, SCAL can leave the cargo at any possible location or storage place during the transport meanwhile notify the shipper or consignee. Associated fees should be paid by the shipper and consignee. SCAL can also deliver the cargo to other carrier to continue the transport to the destination. Art. 19 Shipper’s Right of Disposition (1) Subject to his liability to carry out all his obligations under the contract of transport of cargo by air, the shipper shall have the right to dispose of the cargo by withdrawing them at the airport of departure or destination, or by stopping them in the course of the journey on any landing, or by calling for them to be

delivered at the place of departure, or in the course of the journey to a person other than the consignee named in the air waybill, or by requiring them to be returned to the airport of departure; provided that the shipper must not exercise this right of disposition in such a way as to prejudice SCAL or other shippers and he must repay any expenses occasioned by the exercise of this right, provided also that every exercise of the right of disposition must he applicable to the whole shipment under a single air waybill or a single shipment record. (2) The fight of disposition must he exercised fully in compliance with applicable laws, government regulations, orders, and requirements of concerned countries, otherwise, SCAL shall refuse to carry out the orders. (3) Instructions as to disposition must be given in writing with presenting the original air waybill (for shipper) to SCAL. (4) If it is impossible to carry out the orders of the shipper SCAL must so inform him forthwith. (5) The shipper should bear the costs incurred in exercising its right of cargo disposal and shall be responsible for the losses caused to Sichuan Airlines or other carriers due to the implementation of cargo disposal. Art. 20 SCAL’s Right of Disposition (1) To ensure timely transport of the cargo shipped, SCAL may change the flight, the route or routes, type of aircraft or carrier specified on the air waybill under the case that it is unable to or there is not enough time to inform the shipper. (2) SCAL reserves the right, without notice, to cancel, terminate, divert, rearrange or postpone any flight, or to proceed with any flight without all or any part of the cargo because of following factors. 1. Government regulations, instructions or requirements; 2. Force majeure, including but not restricted to weather, disturbance, political turmoil, embargo, war, curfew, strike, sabotage, unstable international situation, terrorism acts or the war or warning against terrorism acts from government, etc. (3) To achieve reasonable transport, SCAL is authorized to carry the consignment without notice wholly or partly by any means of surface transportation or to arrange such carriage. (4) To ensure flight safety or to follow laws and regulations, SCAL may decide to remove some or all articles consigned from a shipment, at any time or place whatsoever, and to proceed with the flight without them. (5) SCAL shall give prompt notice to the shipper or to the consignee in the event of exercising the right of disposition. (6) Unless otherwise stipulated by laws, Sichuan Airlines shoulders no responsibility for the cargo which is cancelled or rearranged or finally unloaded at other places other than destination airport, or the cargo carriage is cancelled, rearranged, proceeded with carriage or terminated due to factors stated in item (2). Art. 21 Suspension of Carriage (1) Carrier reserves the right to terminate the carriage of any cargo if carrier reasonably determines in good faith that the carriage of the cargo is in violation of any applicable law, government regulation, demand, order or requirement. The shipper shall be liable for any consequences therefore. SCAL may hand the cargo over to the competent authority if necessary. The shipper may at his own expense dispose of the cargo which is so terminated by requiring SCAL to return it to the airport of departure if it is prepared fully in compliance with air transportation conditions. (2) Cargo which, because of inherent defect, quality or vice or because of defective packing, is likely to endanger aircraft, persons or property may be transferred or destroyed by SCAL without notice any time at any place. Sichuan Airlines shoulders no responsibility. CHAPTER 7 DELIVERY OF SHIPMENT Art. 22 Notice of Arrival Notice of shipment arrival will be sent to the consignee promptly by SCAL, which will be sent by ordinary methods such as phone call or written paper. SCAL is not liable for non-receipt or delay in receipt of such notice which is not caused by SCAL. Art. 23 Delivery of shipment (1) The shipper’ s right of disposition shall cease at the moment when, after arrival of the cargo at the destination, the consignee takes possession or requests delivery of the cargo or air waybill, or otherwise shows his acceptance of the cargo. Nevertheless, if the consignee declines to accept the air waybill or the cargo, or if he cannot be communicated with, such right of disposition shall continue to vest in the shipper. (2) Except as otherwise specifically provided in the air waybill, delivery of the shipment will be made only to the consignee named therein. (3) Except as otherwise provided, the consignee must accept delivery of and collect the shipment at the place designated by SCAL. (4) In the case of loss or damage, delay to goods, the person entitled to delivery may make a complaint to SCAL forthwith at the time of delivery. After being examined and confirmed by both sides, as per actual situations, every complaint must be made in writing upon the air waybill or by filling in Report to Damage or Loss with signing or sealing by both sides. This record can be regarded as the evidence for the consignee to lodge a claim to Sichuan Airlines afterward. (5) Receipt by the person entitled to delivery of the cargo without complaint is prima facie evidence that the same has been delivered in good condition and in accordance with the contract of carriage. (6) Delivery to the consignee shall be deemed to have been effected, when the shipment has been delivered to customs or other government authorities as required by applicable State laws and regulations. Under these circumstances, the consignee or shipper will be notified. (7) By accepting delivery of the air waybill and/or the shipment the consignee shall become liable for payment of all costs and charges in connection with the carriage. Unless otherwise agreed the shipper shall not be released from his own liability for these costs and charges and will remain jointly and severally liable with the consignee. SCAL may make delivery of the shipment or the air waybill conditional upon payment of these costs and charges. (8) SCAL may take necessary measures of disposal without notice at the cost of the shipper, when the perishables become deteriorated, or live animals become dead, or any cargo which is likely to endanger aircraft, persons or property. Art. 24 Disposal of Non-Delivery Cargo (1) If the consignee refuses or fails to take delivery of the shipment within the prescribed period after its arrival at the airport of destination, SCAL will endeavor to comply with any instructions of the shipper set forth on the face of the air waybill, or in the shipment record. If such instructions are not so set forth or cannot reasonably be complied with, SCAL shall notify the shipper of the consignee’s failure to take delivery and request his instructions. (2) SCAL may take measures in accordance with the provisions set forth in carrier’s regulations applicable to the disposition of non-delivery cargo in the following cases: 1.failure to take delivery of the shipment within 14 days of receipt of consignment at destination; 2.refusal of consignee to accept delivery or to pay the relevant payments incurred; 3.failure to notify the consignee at the address stated in the air waybill. (3) SCAL will take the following methods to handle the cargo which cannot be delivered. 1. Notify the departure station, which should ask for handling comments from the shipper, and handle the cargo in line with the comments put forward by the shipper. 2. Send the cargo back to the departure station and wait for the instruction of the shipper. 3. When the storage period reaches 30 days, the cargo should be handled in line with the laws and regulations of the local country. 4. Exercise a public auction of all the cargo or part of the cargo. SCAL has the right to compensate the transport cost; fees; prepaid charges and fees caused by the auction for itself; the third party carrier or other legal claim settlement. All these charges should be paid by the shipper or the consignee and the auction of the cargo does not relieve the responsibility of the shipper and the consignee to pay the difference. (4) SCAL should notify the handling result to the shipper after it handles the cargo, which cannot be delivered, in line with the laws and regulations. (5) The shipper should pay for all the charges and fees caused by the cargo, which cannot be delivered, including the fees caused by the transport of the cargo back to the destination station and the consignee should have joint liability. (6) If the cargo consisting perishable goods faces deterioration due to the flight delay; unclaimed cargo; the consignee refuses to collect the cargo or other reasons, SCAL has the right to take all reasonable measures without previous notice, which are included but not limited to the following: 1. Request handling comments of the shipper and handle the cargo in line with the comments of the shipper, who should pay for all the fees. 2. Destroy or abandon all the cargo or part of the cargo. 3. Exercise proper handling of the cargo without advance notice on the basis that the shipper will bear all the risks. If the cargo will be sold off or exercise an auction, the revenue will be used to settle all the cost and fees of SCAL. CHAPTER 8 CARRIAGE OF SPECIAL CARGO Art. 25 Carriage of Special Cargo (l) Shipments to be termed as “Special Cargo”，which SCAL accept, refer to dangerous goods, live animals, perishables, valuable cargo, and human remains, etc.. (2) When the shipper undertakes to deliver special cargo, the provisions of this Chapter shall apply. In respect of cases which are not regulated by this Chapter, other related provisions of these Conditions may apply. Regulations about special cargo transport of related country and SCAL should be followed. (3) The carriage of special cargo must be in compliance with the conditions set forth in SCAL’s regulations applicable to the carriage of special cargo. The shipper shall be liable to and indemnify SCAL or any other person to whom SCAL is liable for all damage occasioned by non-observance of the regulations aforementioned. (4) The special cargo must be packed in accordance with the provisions in SCAL’s regulations applicable to the packing requirements of special cargo. (5) Special cargo is acceptable only under SCAL’s approval, and arrangement must be made in advance. (6) The shipper and the consignee shall deliver and take delivery of special cargo at the place designated by SCAL. (7) The carriage of special cargo whose nature is of more than one class or division shall be in compliance with the regulations of the respective class or division simultaneously. (8) With respect of carriage of special cargo, SCAL shall comply with regulations of special cargo on the basis of observance of the conditions relating to the carriage of general cargo. CHAPTER 9 CHARTERS Art. 26 Charters (1) The charterer may apply to SCAL for chartered flights, a charter agreement is signed therewith by both sides. (2) Both the charterer and SCAL shall undertake their respective responsibilities, rights, and obligations prescribed in a charter agreement except for any reason beyond their control or not reasonably to be foreseen, anticipated, and predicted. (3) The Shipper’s Letter of Instruction and the Air Waybill shall be filled out for each chartered flight as documentary evidences of the carriage. (4) The charterer and SCAL may determine whether attendants will be needed according to the nature of goods. The attendants will purchase tickets by the charter agreement and go through the prescribed check- in and boarding formalities. (5) In the event of modification to the charter agreement, the charterer shall pay to SCAL the relevant charges occurred in carrying out the charter agreement. (6) Any space of the chartered flights may be fully utilized by the charterer, nevertheless the maximum allowable traffic loads must not be exceeded. If SCAL needs to utilize the unused space of the chartered flight, he shall consult with the charterer. CHAPTER 10 CLAIM, LIABILITY AND INDEMNITY Art. 27 Claim (1) In the case of damage or delay to goods, a complaint is made to SCAL in writing by the shipper or the consignee. Such complaint shall be made within the periods prescribed in the following paragraphs: in the case of visible damage to or partial loss of the goods, immediately after its discovery and at the latest within fourteen (14) days in written form from the date of receipt of the goods; in the case of other damage to the goods, within fourteen (14) days in written form from the date of receipt of the goods; in the case of delay, within twenty-one (21) days in written form from the date on which the goods were placed at the disposal of the person entitled to delivery; In the case of non-delivery of the goods, within one hundred and twenty (120) days in written form of the date of issue of the air waybill. (2) Every complaint must be made in writing upon the document of transport or by separate notice dispatched within the periods prescribed in the preceding paragraph. (3) Failing to make complaint within the periods provided in paragraph 1 of this Article, the consignee or the shipper shall be deprived of the fight to claim compensation from SCAL, save in the case of fraud on the part of SCAL. (4) For the claimed settlement which does not meet the convention; laws and regulations, SCAL should give a clear reply to the shipper within specified time limit. Art. 28 Carrier’ s Liability (1) SCAL shall be liable for the destruction or loss of, or damage to any cargo, if the occurrence took place during the transport by air, excepted for the liability which SCAL is excluded by convention; laws and regulations. The “period of the transport by air” refers to the whole period during which file checked cargo is in the charge of SCAL, whether in an airport or on board a civil aircraft, or, in the case of a landing outside the airport, in any place whatsoever. (2) SCAL shall be liable for damage occasioned by delay in the transport by air of cargo; provided that SCAL is not liable if he proved that he and his servants or agents have taken all necessary measures to avoid the damage or that was impossible for him or them to take such measures. (3) SCAL is not responsible for the direct or indirect loss caused by force majeure or

www businessmirror com ph the case that the convention; laws and regulations are followed. When the shipped cargo is subject to certain kind of cargo that SCAL prohibited or against appropriate law and regulations, SCAL will refuse to transport and will not be responsible for this. (4) SCAL is not liable if he proves that the destruction or less of, or damage to, the cargo resulted solely from one or more of the following: 1. Inherent defect, quality or vice of that cargo; 2. Defective packing of that cargo performed by a person other than SCAL or his servants or agents; 3. Internal articles short or damaged with perfect packaging and sealing marks unchanged; 4. Rational spoilage of goods; 5. An act of war or an armed conflict; 6. An act of public authority carried out in connection with the entry, exit or transit of the cargo. 7. Force majeure. (5) Carrier shall not be liable for any consequential damage sustained in the event of destruction or loss of, or damage to, or delay in the carriage of cargo. (6) SCAL is not liable for the decay or deterioration of the cargo due to the change of weather; temperature or altitude or other normal cases or the transport time is within the due date. (7) SCAL will not be liable for any loss, damage or expense arising from death due to natural causes or death or injury of any animal caused by the conduct or acts of the animal itself or of other animals such as biting, kicking, goring or smothering, nor for that caused or contributed to by the condition, nature or propensities of the animal, or by defective packing of the animal, or by the inability of the animal to withstand unavoidable changes in its physical environment inherent in the carriage by air. (8) SCAL is not liable for any damage, delay or loss in connection with the carriage of cargo with attendants, unless such damage, delay or loss is proved to have been caused by the default of SCAL In no event will SCAL be liable for death or injury to an animal attendant caused or contributed to by the condition, conduct or acts of animals. (9) In the transport of cargo, if the carrier proves that the destruction, loss, damage or delay was caused by or contributed to the fault of the person claiming compensation, or the person from whom he derived his right, SCAL shall he wholly or partly exonerated from his liability in accordance with the extent of the fault that caused or contributed to such damage. (10) SCAL is not liable for any loss or damage arising from the exercise of shipper’s right of disposition, unless such loss or damage is proved to have been caused by the willful default of SCAL. (11) Sichuan Airlines issuing an air waybill for carriage over the lines of another carrier does so only as agent for such other carrier. Sichuan Airlines shall not he liable for the destruction, loss, damage or delay of cargo occurring on other carrier’s lines. (12) Unless otherwise stated, SCAL is not liable for the indirect loss caused by the damaged cargo or caused by the transport under this condition including the loss of turnover; profits; interest or income; missed opportunities; currency risk; reduction of output or administrative punishment and etc. , no matter whether SCAL knows about the possibility of above-mentioned loss. (13) Whenever the liability of SCAL is excluded or limited under these conditions, such exclusion or limitation shall apply to agents, servants or representatives of SCAL and also to any carrier whose aircraft of other means of transportation is used for carriage. (14) Carriage to be performed under one contract of carriage by several successive carriers is regarded as a single operation. In the case of transport to be performed by various successive carriers, each carrier shall be deemed to be one of the contracting parties to the contract of transport, and assume liability in so far as that part of the transport is concerned which is performed by it in accordance with the contract. Art. 29 Indemnity SCAL’s extent of liability is decided by the applicable convention and law. The following items are applicable unless otherwise stated by the applicable convention or law, which is stated for the profit of the legal claimant. (1) If the shipper has made a special declaration of value for carriage and has paid the valuation charges, any liability shall in no event exceed such declared value for carriage as the loss incurred in course of carriage. SCAL, who can prove that the actual loss or damage is below the declared value, will indemnify the shipper for the actual loss or damage. (2) As per regulations of Warsaw Convention, Hague Protocol and the Montreal Convention, for the cargo without a special declaration of value for carriage, the liability of SCAL shall not exceed 19. Special Drawing Rights ( SDRs) per kilogram or 20 USD or equivalent currency. SCAL, who can prove that the actual loss or damage is below such liability of carrier for damage, will indemnify the shipper for the actual loss or damage. (3) ln the case of destruction, loss, damage or delay of part of the shipment, or of any object contained therein, the weight to be taken into consideration in determining the amount to which SCAL’s liability is limited shall be only the weight of the package or package concerned. Nevertheless, when the destruction, loss, damage or delay of part of the shipment, or of an object contained therein, affects the value of other packages covered by the same air waybill, the total weight of such package or packages shall also be taken into consideration in determining the limit of liability. In the absence of proof to the contrary, the value of any such part of the shipment destroyed, lost, damaged or delayed as the case may be, shall be determined by reducing the total value of the shipment destroyed, lost, damaged or delayed has to the total weight of the shipment. (4) Claimant should provide with the actual value proof of the cargo when lodging the claim. (5) The insurance company should make compensation for the cargo lost in transportation, which insured air transport insurance, in line with related rules. CHAPTER 11 LEGAL ACTION Art. 30 Legal Action (1) The right to damages shall be extinguished if an action is not brought within two years, reckoned from the date of arrival at the destination, or from the date on which the aircraft ought to have arrived, or from the date on which the transportation stopped. The method of calculating the period of limitation shall be determined by the law of the Court to which the case is submitted. (2) In the event of destruction or loss of, or damage to, or delay in the carriage of cargo which is performed by various successive carriers, the consignor shall have a right of action against the first carrier, and the consignee shall have a right of action against the last carrier, and further, each may take action against the carrier who performed the transportation during which the destruction, loss, damage, or delay took place. (3) In relation to the transport performed by the actual carrier, an action may be brought against that carrier or the contracting carrier separately, or against both together; the carrier against whom an action has been brought shall have the right to require the other carrier to join in the proceedings. (4) The Chinese law is applicable for the dispute derived from this condition or related to this condition. Under the precondition that the convention is applicable, the lawsuit about the loss can be exercised at the court which the claimant selected; the local court where SCAL head quarter located; or the court where the SCAL branch located, where the contract is signed, or at the place within the governance of the destination court or other judicial jurisdiction. CHAPTER 12 EFFECTIVENESS, MODIFICATION AND INTERPRETATION Art. 31 Effectiveness This provision takes effects since the day it issued. Should some items of this provision are considered invalid or cannot be performed as per applicable law, other items of this provision remain effective. Art. 32 Modification Sichuan Airlines reserves the right to modify any articles contained in these Conditions without notice in accordance with the procedures prescribed by CAAC. However, no such modification shall apply to a contract of carriage after the date of issuance of the air waybill by carrier. The agents, employees or representatives of Sichuan Airlines have no right to change, modify or give up any item of this provision. Art. 33 Interpretation The Conditions will be responsibly interpreted by Sichuan Airlines.

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Chapter 1 Definitions Article 1 The following terms used in General Conditions of International Carriage for Passengers and Baggage of Sichuan Airlines Co., Ltd (hereafter referred to as “the Conditions”) are defined as follows unless otherwise specified: (1) SCAL refers to Sichuan Airlines Co., Ltd. On the ticket, the word code of Sichuan Airlines is 3U. (2) Convention refers to whichever of the following instruments that is applicable: The Convention for the Unification of Certain Rules Relating to International Carriage by Air (“Warsaw Convention” for short), signed at Warsaw, 12 October 1929; The Warsaw Convention as amended at The Hague (“Hague Protocol” for short) on 28 September 1955; and The Convention for the Unification of Certain Rules for International Carriage by Air (“Montreal Convention” for short), done at Montreal on 28 May 1999. (3) International Carriage refers to air carriage in accordance with air carriage contract between SCAL and the passenger, whether there is a break or transfer in the transportation or not, of which the origin, appointed stopover or destination is not located in the People’s Republic of China. (4) SCAL’s Regulations refers to rules, other than the Conditions, published by SCAL and in effect on date of publication, governing carriage of passengers and/or baggage and shall include any applicable tariffs in force. (5) Carrier refers to the pub m w C

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Chapter 1 Definitions Chapter 2 Applicability Chapter 3 Tickets Chapter 4 Fares, Fees and Charges Chapter 5 Reservations Chapter 6 Ticketing Chapter 7 Check-in and Boarding Chapter 8 Baggage Chapter 9 Schedules, Cancellation, Alterations of Flights Chapter 10 Changes to Tickets Chapter 11 Refunds Chapter 12 Conduct aboard Aircraft Chapter 13 Refusal and Limitation of Carriage Chapter 14 Arrangement of Extra Service Chapter 15 Administrative Formalities Chapter 16 Passenger Services Chapter 17 Successive Carrier Chapter 18 Liability for Damage Chapter 19 Effectiveness and Modification

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General Conditions of International Carriage for Passengers and Baggage of Sichuan Airlines is developed in accordance with Montreal Convention, Warsaw Convention, Civil Aviation Law of the People’s Republic of China, Civil Aviation Regulations on International Carriage for Passengers and Baggage, Operation Certification: Large Airplanes Air Carrier (CCAR-121), Dangerous Goods Regulations and other current applicable laws, rules and regulations. General Conditions are one part of the contract of international carriage for passengers of Sichuan Airlines, the regulatory document at company level of Sichuan Airlines, and the described guidelines, policies, provisions and standards of international carriage of passengers and baggage are the tenet and criteria all staff and ground service agent must abide by in ticketing and ground service of international carriage for passengers. Each department and person engaged in international carriage for passengers and baggage, including branch, sales department, representative office and ground agent, must strictly follow and carry out the General Conditions. The issuance of General Conditions will instruct and improve the standardization, normalization and programming of ticketing, check-in service, and baggage transportation etc. in the international passenger carriage of Sichuan Airlines, and ensure constant improvement of flight operation safety, regularity and service of Sichuan Airlines.

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www businessmirror com ph takeoff time, SCAL will decide whether to extend the period of validity of such passenger’s tickets and tickets of the passenger’s accompanying persons in accordance with SCAL’s regulations applicable to the fare paid. (4) In the event of death of a passenger enroute, the tickets of his or her accompanying persons may be modified by extending the validity, or refunded in accordance with involuntary refunds regulations. Any such modification and refund shall be made upon receipt of a proper death certificate and any such extension of validity shall not be for a period longer than 45 days from the date of death shown on the death certificate. 3.4 Loss of Paper Ticket Article 10 General Rules Passenger shall be liable for the loss of unused tickets, flight coupons, miscellaneous charges orders or exchange coupons of MCO, or any other documents for transportation. SCAL will not be responsible for any effect on such passenger’s itinerary. SCAL will decide whether or not to refund, replace such documents in accordance with its concerned regulations and certain condition. Passenger has no right to claim that SCAL must refund or replace such tickets or documents. Article 11 Report of Loss of Ticket (1) In case of loss or mutilation of a ticket, or part thereof, or non-presentation of a ticket containing the passenger coupon and all unused flight coupons, the passenger must report in writing to SCAL or its authorized agents. Such passenger shall complete the form of “Application of Lost Ticket”. Formalities of reporting the loss of group tickets must be done before the deadline time of check-in. Report of loss cannot be done on tickets of charter flights. (2) When reporting for loss of a ticket, the passenger must present his/her valid identity document, advise the date and place of issuance and the agent coupon or its copy of the original ticket, and present proof of loss issued by the public security department where the ticket is lost and other data or proof satisfactory to SCAL. If the reporter is not the passenger, valid identity documents of the reporter and the passenger must be presented. (3) The application for report of loss of a ticket shall be handled as soon as possible within the period of validity of the ticket. (4) If someone other than the person entitled to be carried or to be refunded has traveled with or refunded the ticket, SCAL shall not be liable to the person so entitled. Article 12 Re-issuance of Lost Ticket and Deadline for Refunding (1) On principle, a fixed ticket, once lost, cannot be allowed to be reissued. But on special occasions, after it’s approved by SCAL’s direct sales department which deals with the loss report, and after the passenger provides proofs in accordance with Article 11 of the Conditions confirmed by SCAL, it is allowed to reissue a ticket on original flights if the following requirements are met: 1. Passenger fills Application of Loss Report for tickets of Sichuan Airlines Co, Ltd. 2. Passenger declares to agree to compensate for any damage caused thereby to SCAL, including the damage caused by others’ using or refunding the lost ticket, and the necessary lawsuit fees. (2) An open ticket or MCO, once lost, can only applied for refund and cannot be applied for re-issuance. (3) SCAL has the right to refuse to reissue lost tickets which have not been confirmed. In that case if passenger requests to continue to travel, passenger shall purchase a new ticket at fares applicable then. (4) The deadline for refunding tickets purely operated by SCAL is 60 days after 13 months from the date of commencement of travel, or the date of issuance if no portion has been used; if any sector is operated by another carrier than SCAL, the deadline for refunding is 60 days after 18 months from the date of commencement of travel; Within this period, if someone other than the person entitled to be carried or to be refunded has traveled with or refunded the ticket, SCAL shall not be liable to refund to the person so entitled. (5) If printed itinerary of e-ticket is lost because of reasons of passengers, according to Temporary Regulations on Itineraries of E-tickets of Air Carriage, it cannot be re-printed. 3.5 Sequence and Usage of Coupons Article 13 (1) Ticket purchased by passenger is only applicable for the transportation from the origin to destination via the any agreed transition point as listed on the ticket. The fare paid by passenger is based on SCAL’s tariff rules and the transportation listed on the ticket. Fare is the basic content of the transportation contract between SCAL and passenger. (2) Coupons of ticket must be used in the sequence listed on the ticket. Coupons that have been used not in sequence shall be refunded according to the refund restrictions of SCAL’s tariff rules within the period of validity. (3) If passenger wishes to change any aspect of transportation, he/she must contact SCAL in advance. The fare for passenger’s new transportation will be recalculated and passenger will be given the option of accepting the new price or maintaining his original transportation as ticketed. If passenger is required to change any aspect of transportation due to Force Majeure, passenger must contact SCAL as soon as practicable and SCAL will use reasonable efforts to transport passenger to the next stopover or final destination. (4) If passenger changes his transportation without SCAL’s agreement, SCAL will assess the correct price for passenger’s actual travel. Passenger will have to pay any difference between the price paid and the total price applicable for the revised transportation. (5) Some changes on the content of transportation such as changing the place of departure or reversing the direction of travel, can result in an increase of price. Many fares are valid only on the dates and for the flights shown on the ticket and may not be changed at all, or only upon payment of an additional fee. (6) Each flight coupon contained in a ticket will be accepted for transportation in the class of service on the date and flight for which space has been reserved, as shown in the flight coupon. When a ticket is originally issued without a reservation being specified, space may be later reserved subject to SCAL’s tariff rules and the availability of space on the flight requested. (7) If passenger does not show up for any flight, for which he/she is holding a reservation, without advising SCAL in advance, SCAL may cancel passenger’s return or onward reservations as shown in the ticket. 3.6 Over-booking According to the common practice of international civil aviation industry, SCAL may make suitable over-booking on some flights. Under particular circumstances, it may result in some passengers’ failure to travel on flights as arranged. When there is not enough space, SCAL will seek for passengers voluntary to disembark and will help them check in on priority. For passengers who cannot travel due to over-booking, SCAL will do its best to arrange them on the soonest available flight, and will give a certain amount of compensation. Chapter 4 Fares, Fees and Charges Article 14 Application of Fares (1) Fares apply only for carriage from the airport at the point of origin to the airport at the point of destination. Fares do not include fees for ground transport service and additional services. (2) The applicable fare refers to the fair published by SCAL and combination fare specified by SCAL if no fare is published. The applicable fare is the fare for the flights in effect on the date of commencement of the carriage covered by the first coupon of the ticket. (3) Once the ticket is issued, if the fare is adjusted, the payment remains the same. If the passenger requests to change the flight or date, the fare to be charged may be affected. (4) A special fare ticket is subject to the conditions specified thereof. Article 15 Routing Fares apply only to routings published in connection therewith. If there is more than one routing at the same fare, the passenger may specify the routing prior to issue of the ticket. If no routing is specified, SCAL or its authorized agent may determine the routing. Article 16 Taxes, Fees and Charges Any tax, fee or charge imposed by government or other authority, or by the operator of an airport, in respect of a passenger or the use by a passenger of any services or facilities will be in addition to the published fares and charges and shall be paid by the passenger and collected by airlines at the time of ticket issuance. On purchasing a ticket, passenger will be advised of taxes, fees and charges not included in the fare, most of which will normally be shown separately on the ticket. The taxes, fees and charges imposed on air travel are constantly changing and can be imposed after the date of ticket issuance. If there is an increase in the applicable tax or a new tax, fee or charge is imposed after ticket issuance, passenger will be obliged to pay it. Likewise, in the event any taxes, fees or charges which passenger has paid to SCAL at the time of ticket issuance are eliminated or reduced, passenger may be entitled to a refund of any such taxes, fees or charges as have been eliminated or reduced. Fuel surcharge and air insurance surcharge are published and charged by the carrier according to relevant regulations of the State or region. Infants are exempt from fuel surcharge; children are charged the same amount of fuel surcharge as adults. Article 17 Payment Fares and charges are payable in any currency acceptable to SCAL. When the currency paid is not the currency of published fare, passenger shall pay according to the exchange rate specified by SCAL. Unless otherwise agreed by SCAL and passenger, fares and charges are all paid in cash. Chapter 5 Reservations Article 18 Reservation Requirements (1) Reservations are not confirmed until recorded as accepted by SCAL or its authorized agents. Reservations shall be tentative unless and until the passenger makes payment by the time fixed by SCAL according to the formalities specified by SCAL, and SCAL or its authorized agents have issued a validated ticket for the carriage for such space is reserved and issued the related flight coupon to the passenger. (2) According to SCAL’s regulations, certain fares may have conditions that will limit or exclude the passenger’s right to change or cancel reservations. (3) SCAL keeps the right to suspend reservations for a certain flight when it is necessary. Article 19 Special Passengers (1) Passengers who need accompanying due to operation, safety and security reason (e.g., infants, children, the old, invalid, and person under escort etc.) must be booked in the same compartment as that of the accompanying person. (2) A special passenger is someone, during the flight, to be accorded courteous reception; or needing special care on account of his or her physical or mental conditions; or acceptable for carriage in certain conditions. The reservation may be accepted after SCAL and other carriers concerned consent to the carriage of such special passengers. Article 20 Ticketing Time Limits If a passenger has not paid for the ticket prior to the specified ticketing time limit, SCAL may cancel the reservation. Article 21 Personal Data (1) The personal data provided by passenger to SCAL is intended for reservation and arrangement of related carriage service. Therefore, passenger authorizes SCAL to retain his/her personal data and transmit the data to related SCAL departments, other carriers concerned, or service provider concerned, or organizations authorized by laws and regulations. The objects may be in any country. SCAL will keep the personal files provided by passengers in great confidentiality. (2) The validity period of valid document provided by passenger shall at least be 6 months since the date of commencement of travel. Passenger shall be liable for the authenticity of such data. SCAL will not be responsible for verification. (3) If passenger refuses to provide such data, SCAL may refuse for carriage. Article 22 Cancellation of Reservation (1) Application for change or cancellation of reservation must be raised within the valid period stipulated by SCAL. When fares have correspondent restrictions, passenger’s change or cancellation of reservation shall be subject to such restrictions. (2) If passenger does not use his/her reserved seat without advising SCAL or its authorized agents in advance, SCAL may cancel passenger’s return or onward reservations as shown in the ticket; and collect service fee from such passenger. Chapter 6 Ticketing Article 23 General Rules (1) Passenger can purchase tickets at the sales office of SCAL or SCAL’s authorized agencies, or at SCAL’s websites. Passenger can inquire or purchase ticket at SCAL’s hotlines: SCAL’s websites: http://www.sichuanair.com SCAL’s hotlines: 95378, 028-88888888 SCAL’s hotlines for direct sales: 95378、028-88888888 (2) Passenger shall fill up the Reservation Form for Passengers, providing valid identity document information of his/her own or other valid identity documents produced by public security departments; meanwhile passenger must ensure such information is the consistent with that of the documents during check-in, ensure the validity period of his/her passport is at least 6 months since the date of commencement of travel, and clearly notice the different route and class tariff, endorsement, and refund regulations. (3) SCAL has the right to request passenger produce his or her valid passport or other traveling documents, but will not bear responsibility for the authenticity and the validity of such documents. (4) When purchasing a ticket for child or infant, a valid birth certificate must be presented. (5) When purchasing a ticket for a passenger seriously sick or over 32 weeks pregnant, passenger shall provide a valid medical certificate issued by a county or city level medical department or equivalent medical department level for such carriage that is accepted by SCAL. SCAL will not accept a passenger who is over 36 weeks (included) pregnant for transportation. (6) Each passenger shall respectively hold his/her own ticket. (7) Passengers less than 5 years old must be accompanied by a passenger over 18 years old and with full capacity for civil conduct. Children accompanied by an adult should buy the ticket of the class service level same with his/her accompany.

(8) SCAL or SCAL’s authorized agencies shall sell one-way, consecutive, or round-trip tickets according to the request of passengers. (9) The sales venues or websites of SCAL or SCAL’s authorized agencies shall provide necessary materials such as flight timetable, flight map, air tariffs, passenger information, etc. Chapter 7 Check-in and Boarding Article 24 General Rules (1) The passenger shall arrive at the airport within the time limit stipulated by SCAL, and go through boarding formalities of ticket inspection, baggage consignment and boarding pass claiming on time with ticket and personal valid identification certificate. (2) If the passenger fails to arrive on time at the check-in counter, or fails to arrive at the boarding gate before the stipulated boarding gate closure time, or fails to show his/her valid identification certificate and transport certificate, or he/she is not ready to travel, SCAL may cancel the space reserved for the passenger and will not delay the flight. SCAL is not liable to the passenger for loss or expense due to the passenger’s failure to comply with the provisions of this Article. If the passenger wishes a refund, the amount of such refund shall be processed in accordance with the voluntary refund regulations. (3) Check-in deadline time varies at every airport; if passengers do not understand the check-in deadline time of SCAL flight departure airport, they shall consult sales staff in advance or search on SCAL official website http://www.sichuanair. com. Passengers shall reserve enough time for check-in formalities. If passenger fails to complete boarding formalities before stipulated flight checkin deadlines, SCAL has the right to cancel passenger’s reservation. (4) SCAL and SCAL’s ground handling agencies shall open check-in counters in time, accept valid tickets produced by passengers, and process check-in formalities quickly and correctly. In check-in, it shall carefully check the validity of passenger’s passport (at least 6 months since the date of commencement of travel), visa or endorsement. (5) Before boarding, passengers and their baggage and hand-carry items must go through security check. Article 25 Arrangement of Seats (1) SCAL will endeavor to honor advance seating requests, however, SCAL cannot guarantee any particular seat, and only is responsible to provide passenger seat according to his/her reserved class. (2) For operational, safety or security reasons, the passenger needing to be accompanied shall be seated next to his/her accompanying persons. SCAL reserves the right to assign or reassign seats at any time, even after boarding of the aircraft. (3) Seats near the aircraft’s emergency exits shall be specifically arranged by SCAL. Article 26 Mis-catch or Wrong Boarding (1) If mis-catch happens due to reasons of passengers, ticket shall be dealt according the rules of voluntary refund. (2) If mis-catch happens due to reasons of SCAL, SCAL shall arrange passenger to travel on the soonest flight; if passenger requests for refund, it shall be dealt according to rules of involuntary refund. (3) If passenger boards a wrong flight and the passenger requests to stop traveling at the destination of the flight boarded, no extra fee shall be charged and no fee shall be refunded. (4) If wrong boarding happens due to reasons of SCAL, SCAL shall arrange passenger to travel on the soonest flight to the destination listed on passenger’s ticket; no extra fee shall be charged and no fee shall be refunded. If passenger requests for refund, it shall be dealt according to rules of involuntary refund. Chapter 8 Baggage 8.1 General Rules Article 27 Baggage carried by SCAL, is divided into checked baggage and un-checked baggage according to the carriage responsibility. Article 28 Items Unacceptable as Baggage Passenger shall not include in his or her baggage (both checked baggage and unchecked baggage) or carry on to the cabin: (1) Items that do not constitute baggage as defined in paragraph 33 of Article 1 in Chapter 1 of the Conditions. (2) Items that may endanger the safety of aircraft, staff or property onboard, such as the items listed in the Technical Instructions for the Safe Transport of Dangerous Goods by Air issued by ICAO (ICAO-TI), Dangerous Goods Rules issued by IATA (IATA-DGR) and SCAL regulations, especially for the following items forbidden to transport (included but not restricted to), which are stipulated by SCAL: explosives; gas (including flammable gas, inflammable and nontoxic gas, toxic gas and compressed gas, etc.); flammable substance (including flammable liquid, flammable solid, such as lighter and match, etc.), spontaneous combustible substance and substance that would release flammable gas in contact with water; oxidizer and organic peroxide; toxic substance and infectious substance; radioactive substance or magnetic substance; corrosive substance; various dangerous goods such as threatening and stimulating substance, etc. (3) Carriage of the items is prohibited by applicable laws, regulations or orders of the departure country, destination country, transit country or the country over flown. (4) Articles those in the opinion of SCAL are unsuitable for carriage by reason of their weight, shape, size or character. (5) Live animals, except as pets and service dogs provided for in 8.6. (6) Firearms and ammunition other than for hunting and sporting purposes are prohibited from carriage as baggage. Article 29 Items unacceptable as checked baggage Passenger shall not include in checked baggage the following items. If such items included in checked baggage is lost or damaged, SCAL is liable for it only as common checked baggage. (1) Lithium battery and lithium battery mobile power bank (eg. power bank) cannot be accepted as check-in baggage or contained in check-in baggage. But each passenger may bring the lithium battery and lithium battery mobile power bank (eg. power bank) of following specification with him/her: 1. For lithium ion batteries with rated energy over 100wh but not exceeding 160wh and lithium metal batteries with a lithium metal content exceeding 2g but not exceeding 8g, 2 can be carried as carry-on baggage when approved by SCAL; for lithium ion batteries with rated energy over 50wh but not exceeding 100wh and lithium metal batteries with a lithium metal content exceeding 1g but not exceeding 2g, no more than 2 can be carried; for lithium battery mobile power bank (eg. power bank), regarded as back-up lithium battery, with rated energy no more than 160wh, regardless of the quantity of rated energy, only 2 can be carried at most. 2. The lithium battery with a safety defect recalled by the manufacture and the lithium battery and lithium battery mobile power bank (eg. power bank) with unclear marks, of which the rated energy or the lithium metal content cannot be identified are prohibited to carry. The lithium battery mobile power supply (eg. power bank) for other uses other than personal use is prohibited to be carried. The lithium battery mobile power supply (eg. power bank) is prohibited to be used during flight. (2) Fragile items; (3) Perishable items; (4) Cash or valuable securities; (5) Jewelry; (6) Precious metal and articles thereof; (7) Antiques and valuable paintings; (8) Computer and personal digital device; (9) Samples and valuables; (10) Lithium battery; (11) Important files and documents; (12) Traveling documents, medical certificates, X-ray films; (13) Prescribed drug that needs to be taken regularly. Article 30 Limitation on carriage The carriage of following articles is limited. They may be accepted only in accordance with the SCAL’s regulations as checked baggage. (1) Precision instrument and electric appliances shall be carried as cargo. They may be accepted only in proper packaging as checked baggage. Free baggage allowance does not apply to such items. (2) Sporting equipment, including firearms and ammunition for sporting purposes may be carried as checked baggage by presenting Certificate of Gun Transporting or the certificate issued by sport administration of the State Council, but may not be carried as unchecked baggage in cabin. It shall set the safe of sporting gun, remove the bullets and pack them properly. The carriage of ammunition shall follow the rules of dangerous goods transportation. (3) Edge tool and blunt other than controlled knives, such as kitchen knife, fruit knife, dinner knife, art knife, bistouries, scissor, and steel file, iron awl, axe, short stick, and hammer etc., shall be carried as checked baggage. (4) Dry ice, alcoholic beverage, medicinal or toilet articles and personal smoking materials intended for use by an individual shall not exceed the set quota. (5) Diplomatic envelopes, confidential files; (6) Pet or service dog which is specified in 8.6. (7) The wheelchair and/or other assistant devices for passengers in travel. (8) Liquid hand-carried by passenger. (9) Items not suitable to be carried in cargo compartment such as delicate musical instrument and not meeting the requirements of weight and size by 8.3, shall be carried in passenger cabin as seat-taking baggage. Extra fees shall be charged for such items, and such items shall be taken care of by the passenger. Article 31 Right to refuse carriage In the exercise of SCAL’s discretion, SCAL may refuse to carry passenger or his baggage after informing the passenger. In this circumstance passenger will be entitled to a refund. SCAL may also refuse to carry passenger or his baggage for any of the following reasons: (1) SCAL may refuse or stop carriage as baggage of such items described in Article 28 or Article 29 as are prohibited from carriage as baggage or checked baggage. (2) Unless advance arrangements for its carriage have been made with SCAL, SCAL may carry on later flight baggage that is in excess of the applicable free allowance (oversized bagage). (3) SCAL may refuse to accept baggage as checked baggage unless it is properly packed or its contents comply with the carriage requirements. (4) Such action is necessary to prevent a violation of any applicable laws, regulations, or orders of any State to be flown from, to or over. (5) The carriage of passenger or his baggage may endanger or affect the safety, health, convenience, comfort of other passengers or crew members. Article 32 Right of Security Check For reasons of safety and security, SCAL has the right to request that passenger permit a security check of his/her baggage; if necessary, it may check passenger’s baggage if passenger is not available. If passenger is unwilling to accept the check, SCAL has the right to refuse to carry the passenger. 8.2 Checked Baggage Article 33 Checked baggage must meet the following requirements: (1) Passenger must check baggage with a valid ticket. SCAL shall correctly enter the pieces and/or weight of checked baggage into departure system. Each passenger’s baggage must be recorded on his own record. If passenger holds a paper ticket, baggage content shall be written on the correspondent spot of ticket. (2) Passenger shall complete the formalities for checked baggage at the location and time designated by the carrier. (3) SCAL shall attach a baggage tag to each piece of passenger’s checked baggage, and give a baggage identification tag to passenger. (4) The weight and size of checked baggage shall not exceed SCAL’s restrictions; those checked baggage exceeding such restrictions shall be agreed by SCAL in advance. (5) Passenger shall attach name or other personal mark to the checked baggage before checking it in. (6) Checked baggage must be well packed, locked and bound, and must be able endure a certain amount of pressure, and can be safely loaded, unloaded and carried under normal operation conditions, and shall meet the following requirements: 1) Suitcase and handbags and so on must be locked; 2) It’s not allowed to bound more than two pieces of baggage into one piece; 3) It’s not allowed to attach other items to baggage; 4) Bamboo baskets, net bags, grass strings, grass bags and so on are not allowed to be used as packing materials; 5) Passenger’s name, detailed address and telephone number shall be written on baggage. (7) Checked baggage will, whenever possible, be carried on the same aircraft with passenger. When the checked baggage could not be carried on the same flight with the passenger (due to safety, security or operational reasons), SCAL shall explain the reason to the passenger. Under the preconditions of safety, passenger’s checked baggage could be carried on a subsequent flight and SCAL will deliver it to passenger, unless applicable law requires passenger to be present for customs clearance. 8.3 Free Baggage Allowance Article 34 Free Baggage Allowance (1)the baggage transport rules for all international and regional routes are all subject to piece: details as followed: a. The free checked-baggage allowance for the infant that not take a seat is one checked baggage, of which the sum of three sides shall not exceed 115cm(45 inch) and weight shall not exceed 10kg(22 pounds), and one baby car or baby stroller. b. The free allowance baggage standard is same as that for individual passenger. c. For more than two (included) passengers who take the same flight to the same destination, if they proceed with the baggage check formality at the same time and same location, their free baggage allowances may be calculated as one integrity in accordance with their respective cabin-class standards which they have purchased; d. As for the domestic leg of the international flight, the applicable free-baggage allowance for the passengers shall be handled as per the regulations for the international flight. If the ticket for domestic leg and international leg are purchased separately (that refers to the domestic flight is not a consecutive flight before/after the international flight), therefore, it is not satisfied with the conditions that mentioned above,

then the free baggage allowance should be conducted independently as per each applicable domestic and international rules. e. As for the passenger who buys mixed class ticket, the free-baggage allowance shall be counted as per the rules for each class of the flight. f. If the passenger is voluntarily to change his/her class level, he/she should enjoy a free baggage allowance that corresponding to he/her new ticket; If the passenger is unwilling to change the class level, he/she should enjoy the corresponding free-baggage allowance to his/her original level of ticket. g. When passenger had a stopover during his/her journey, he/she should enjoy the higher free baggage allowance during the whole journey, h. If the major flight leg is conducted by a flight sharing code with SCAL, then the free baggage allowance shall be carried in accordance with rules of the airlines that conducted the flight. (2) The free baggage allowance for international/regional routes refers to the standards published on the official website the Sichuan Airlines. (3) The Size limits for checked baggage a. The size limits of checked-baggage shall comply with the local laws and regulations, if there are no defined regulations on the size limits, then, the size of each checked-baggage shall not exceed 300cm(the sum of length, width and height)(118 inch) b. The checked-baggage that exceeds the above size limit shall be transport as a cargo. (4) The weight limits on checked-baggage. a. For the flights involved with British or british commonwealth of nations(e.g. Canada, Australia and etc. ), the weight for each checked-baggage shall not exceed 32kg(70 pounds) b. The weight limits of checked-baggage in other airports shall comply with the local laws and regulations, if there are no defined regulations on the weight limits, then, the weight of each checked-baggage shall not exceed 45kg(100 pounds). c. The checked-baggage that exceeds the above weight limit shall be transport as a cargo. Article 35 Free Hand-carry baggage (1) Weight and size Each passenger who is entitled to travel in first class can bring two pieces of hand-carry baggage, each of which must not exceed 5kg in weight. Each passenger who is entitled to travel in business or economy class can bring one piece of handcarry baggage, each of which must not exceed 5kg in weight. The sum of the three dimensions of each piece must not exceed 115cm. Such baggage can be placed in the baggage cabin or under the seat in the passenger cabin. If the baggage cannot be placed with the method mentioned above, or due to over-size and over-weight factors, or out of consideration of safety aspect, the baggage shall be carried as check-in baggage. (2) Bulky baggage Objects not suitable for transport in the cargo compartment (such as delicate musical instrument) and not complying with paragraph (1) above will only be accepted for transportation in the passenger cabin as seat-taking baggage and be taken care of by passenger, if due notice has been given in advance and permission granted by SCAL. The transport of such objects may be charged separately. Article 36 Checked baggage and un-checked baggage shall be weighed or piececalculated together at the time of check-in and the weight and pieces shall be entered in corresponding column of “passenger ticket and baggage check”. Checked baggage is under custody of SCAL during the journey, while the unchecked baggage shall be taken care of by passenger in the journey. 8.4 Excess (Oversized) Baggage Article 37 (1) Excessive (exceed the limit) baggage refers to the part of baggage in excess of the free baggage allowance of weight or in piece, the exceed part of baggage needs extra charges. (2) When charging for the extra fees for excessive (exceed the limit) baggage, a excessive (exceed the limit) baggage receipt needs to be filled. (3) The excessive (exceed the limit) baggage shall be charged in accordance with the number, weight and size in exceeding . (4) Charging standard for the excessive baggage refers to the standards published on the official website the Sichuan Airlines. (5) The default currency of above fess is RMB. In some cases (if the passenger has no RMB), the fees will be charged in local currency, which should be referred to the charge standard of the destination for the baggage. 8.5 Declaration and Charge Article 38 General Rules (1) A passenger may declare a value for checked baggage in excess of USD30 or its equivalent per kilogram, and shall pay an applicable charge. (2) The declaration for checked baggage must not exceed the real value of the baggage. The maximum declared value of each passenger is USD5,000 or its equivalent value in other currencies. If SCAL disagrees with a value declaration and the passenger refuses to be checked, SCAL has the right to refuse carriage. (3) No declaration value for pet will be accepted. (4) SCAL will charge an fee of 5‰ of extra declared value exceeding the limitation of paragraph (1) above. Article 39 SCAL will refuse to accept an excess value declaration on checked baggage when a portion of the carriage is to be provided by another Carrier who does not offer the facility. 8.6 Pets and Guide Dogs Article 40 Pets mean such little animals as domestic dogs, cats, birds and other household pets. Any wild and aggressive animal such as snakes, tibet mastiffs, and bulldogs will not be accepted for transportation. Animals which are not suitable for air travel (including flat-faced dogs and flat-faced cats) must not be carried as baggage. The carrier has the right to determine whether an animal can be carried and the way of transportation, and has the right to restrict the number of pets on a plane. Article 41 Pet may be accepted for carriage subject to following rules: (1) It shall be loaded in the container whose quality and size meets consignment standards, attached with valid Certification for Animals Quarantine and animal vaccine injection certificate. (2) Have valid certificates necessary for entry, exit and transit permits required by The People’s Republic of China and countries involved in transportation; (3) With the advance agreement of SCAL and other Carriers concerned, and formalities required by SCAL and other Carriers concerned. Article 42 The animal, together with its container and food carried by passenger shall be carried as checked baggage and passenger will be obliged to pay the excess (oversized) baggage fee. Except specially approved by SCAL, animals will not be carried in the passenger cabin of the aircraft. Article 43 (1) Guide dog refers to a dog trained to lead the blind or assist the deaf when if accompanies passenger with impaired vision or hearing dependent upon such dog. (2) The carriage of guide dogs shall be dealt in accordance with Article 41. Guide dogs, if they meet the requirements of the SCAL, may accompany in passenger cabin the disabled eligible to travel. The disabled eligible to travel shall provide valid certificate required by animal entry, exit and transit transport in the People’s Republic of China and associated countries during transport, and valid Certification for Animals Quarantine, animal vaccine injection certificate, Qualified Certificate for Pets Training, Employee’s Card of the Animals or Animal ID Card. Guide dogs, together with its cage and food can be carried for free, without taking up the free baggage allowance. Article 44 Acceptance for carriage of animals (include guide dogs) is subject to the conditions that the passenger assumes full responsibility for such animal unless due to SCAL’s faults. SCAL shall not be liable for injury to or loss, delay, sickness or death of such animal in the event that it is refused entry into or passage through any country, state or territory. Article 45 (1) The passenger is fully liable for all damages or injuries which a pet might cause to other passengers or crew members. (2) SCAL will have no liability in respect of any such animal not having all the necessary exit, entry, health and other documents with respect to the animal’s entry into or passage through any country or region. The passenger who carries this pet shall make a compensation for any penalty, fees, losses or debts to SCAL due to lack or incompleteness of documents required. (3) SCAL may refuse to accept the carriage of animals on non-stop long-haul flight or some specific type of aircraft due to the unsuitability. 8.7 Delivery of Baggage Article 46 Delivery of Baggage (1) Passenger shall collect his baggage as soon as it is available for collection at places of destination or stopover. At the time of collection, passenger shall show his or her “passenger ticket and baggage check” if SCAL requires. (2) With SCAL’s consent, passenger can collect his baggage at stopover under the agreement of SCAL, the unused payment of the excess baggage will not be refunded. (3) If the passenger does not collect his baggage in time, SCAL will charge the passenger baggage keeping fee. SCAL has the right to deal with the perishable items in passenger’s baggage 24 hours after the arrival of the baggage. (4) SCAL is under no obligation to ascertain that the bearer of the baggage identification tag is entitled to delivery of the baggage and SCAL is not liable for any loss, damage, or expense arising out of or in connection with such delivery. (5) If a person claiming the baggage is unable to identify the baggage by the baggage identification tag, SCAL will deliver the baggage to such person only on condition that he or she establishes to SCAL’s satisfaction his or her right thereto. And if required by SCAL, such person shall furnish adequate security to indemnify SCAL for any loss, damage or expense which may be incurred by SCAL as a result of such delivery. (6) Acceptance of baggage by the bearer of the baggage check, without complaint at the time of delivery, is prima facie evidence that the baggage has been delivered in good condition and in accordance with the contract of carriage. Article 47 Unclaimed Baggage If baggage is not collected after 90 days from the next day of baggage’s arrival, SCAL has the right to process it according to the regulations on un-delivered baggage. Article 48 Processing of Abnormal Carriage of Baggage (1) In the event of delay, loss or damage in the carriage of baggage, SCAL and SCAL’s authorized ground handling agency, together with passenger, shall fill up a Record Form of Accidents of Baggage Carriage, check out the situation and reasons, and report the results of investigation to passenger and departments concerned. If compensation for baggage happens, it can be processed at the journey’s origin, stopover or destination. (2) If the checked baggage fails to arrive in the same flight with the passenger due to SCAL reasons and thereby cause inconvenience for passenger’s life, SCAL shall give appropriate compensation for passenger’s temporary life use. Article 49 Compensation for baggage (1) Compensation Limit 1. If the weight of the baggage is not recorded on the baggage check, it is presumed that the total weight of the checked baggage does not exceed the applicable free baggage allowance for the class of service concerned 2. According to the above articles, the checked baggage which has made an declaration should made compensation as per the declared value. If the declared value is beyond the actual value of the baggage, the compensation should be made as per the actual value. 3. The route which applicable for Warsaw Convention a. In case of the absence of purchase invoice and lack of sufficient evidence，the highest compensation price per person should be 30 U.S. dollar per kilogram. b. If there are sufficient evidence， then the highest compensation price for checked baggage and non-checked baggage per person should be 1131 special drawing right 4. The compensation price for the route which subject to Warsaw convention is： a. 17 special drawing right per kilogram. b. 322 special drawing right for the unchecked baggage. 5. Special drawing right refers to SDR specified by International Monetary Fund (IMF). One SDR is equal to 1.37 US dollar, whose price ratio is floating. SCAL will convert the money in line with the exchange rate of the actual transport date. (2) Time limitation on claims and actions 1. Notice of claims a. No action shall lie in the case of damage to checked baggage unless the person entitled to delivery complains to SCAL forthwith after the discovery of the damage, and, at the latest, within seven working days from the date of receipt; and in the case of delay, unless the complaint is made at the latest within twenty-one working days from the date on which the baggage has been placed at his or her disposal. Every complaint must be made in writing and dispatched within the times aforesaid. b. Any claims shall be raised in written form within time limit, or no compensation shall be raised towards SCAL. 2. Any right to damages shall be extinguished if an action is not brought within two years reckoned from the date of arrival at the destination or from the date on which the aircraft ought to have arrived, or from the date on which the carriage stopped. Chapter 9 Schedules, Changes and Cancellations of Flights Article 50 Schedules (1) SCAL undertakes to use its best efforts to carry the passenger and his or her baggage with reasonable dispatch and to adhere to published schedules in effect on the date of travel. (2) Except in the case of its acts or omissions done recklessly with intent to cause damage and with knowledge that damage would probably result, SCAL shall not be liable for errors or omissions in timetables or other published schedules. Additionally SCAL shall not be liable for representations made by employees, agents or representatives of SCAL as to the dates or times of departure or arrival or as to the operation of any flight. (3) The flight times and aircraft types shown in timetables may change between the date of publication and the date passenger actually travel. SCAL does not guarantee them to passenger and they do not form part of contract with SCAL. (4) Before SCAL accept passenger’s reservation for a flight, SCAL will notify the passenger of the scheduled flight time in effect as of that time, and it will be shown on Ticket. It is possible SCAL may need to change the scheduled

Friday June 29 2018 flight time subsequent to the issuance of the Ticket. If passenger provides SCAL with contact information, SCAL will endeavor to notify the passenger of any such changes. If, after ticketing, SCAL makes a significant change to the schedule flight time, which is not acceptable to the passenger, and SCAL is unable to book the passenger on an alternate flight which is acceptable to passenger, passenger will be entitled to a refund in accordance with the regulation of involuntary refund. Article 51 Cancellation, Changes of Flights (1) For the following reasons, schedules are subject to cancel, terminate, change, or delay without notice: 1. For complying with any government law, regulation, or order; 2. For security of flight; or 3. Due to circumstances beyond its control or unable foreseen. (2) If SCAL results passenger failed to take the reserved seat due to one of the following reasons, SCAL shall make arrangement for passenger according to Article 53, and will not collect any fee: 1. Temporarily change the aircraft type of the flight; 2. Except the reasons listed in Article 52, temporarily cancel the flight; 3. SCAL cancels the flight that passenger has reserved seat, or cancel the flight to stop at passenger’s stopover or destination, or fails to operate according to the flight schedule, or fails to provide reserved seat and results in passenger to change his/her trip. Article 52 Involuntary Change (1) If passenger fails to travel due to the reason listed in Article 52(1), SCAL shall consider passengers’ reasonable requests and take one of the following measures: 1.Arrange on priority available seats on SCAL flights for passengers; 2. Make endorsement after agreed by passengers and carriers concerned. 3. Change the route listed on original ticket, and arrange passengers to arrive at destination or stopover point via SCAL or other carriers’ flights. 4. Refund according to rules of involuntary refund. 5. Assist in arrangement of passenger accommodation and provide ground transportation etc. (2) According to International passenger and luggage Transportation Rules of civil aviation of China，For those unvoluntary change the flight due to the reason state in article 52, item (2), the carrier shall provide a place for rest and drinks, foods, board and lodging or other services which carrier think are necessaries. Article 53 Voluntary Change Handle according to the applicable business notice of SCAL. Article 54 SCAL will take all measures that could reasonably be required to avoid delay in carrying passenger and his baggage. SCAL shall not be liable if it proves that SCAL has taken all measures that could reasonably be required to avoid the damage or that it was impossible for SCAL to take such measures. Chapter 10 Changes to Passenger Tickets Article 55 Involuntary Change (1) If such unpredictable non-SCAL reasons as weather, air traffic control cause SCAL flights’ cancellation, advancement, delay, change, mis-connection, or failure to provide reserved seats, SCAL shall consider passengers’ reasonable requests and take one of the following measures: 1. Arrange on priority available seats on SCAL flights for passengers; 2. Make endorsement after agreed by passengers and carriers concerned. (2) If such SCAL reasons as aircraft maintenance, flight readjustment cause SCAL flights’ cancellation, advancement, delay, change, mis-connection, or failure to provide reserved seats, SCAL shall consider passengers’ reasonable requests and take one of the following measures: 1. Arrange on priority available seats on SCAL flights for passengers; 2. Make endorsement after agreed by passengers and carriers concerned; 3. Change the route listed on original ticket, and arrange passengers to arrive at destination or stopover point via SCAL or other carriers’ flights, or via other refers to of transportation mutually agreed. Overpaid amount of ticket fare, excessive (oversized) baggage fee and other service charges will be returned, while deficiency of such fares and charges will be ignored. Article 56 Voluntary change of class, flight, and date Handle according to applicable rules of SCAL tariff notice. Article 57 Endorsement (1) In the event of involuntary change of carrier for passenger, endorsement formalities shall be done after agreed by passenger and carrier concerned. (2) In the event of voluntary change of carrier requested by passenger, SCAL can make endorsement when all the following requirements are met: 1. Passenger’s applicable fare does not have endorsement restrictions. 2. The carrier to be changed into must have has signed an interline agreement, and can issue or receive tickets mutually with SCAL. (3) When passenger does not meet all the above requirements in (2) and demands change of carrier, it shall be processed according to rules of voluntary refund. (4) Unless specially authorized by SCAL, SCAL’s sales agencies are not allowed to do endorsement formalities for passenger. Chapter 11 Refunds Article 58 General Rules (1) On failure by SCAL to provide carriage in accordance with the contract of carriage, or where a passenger requests a voluntary change of his or her arrangements, refund for an unused ticket or portion thereof shall be made by SCAL according to SCAL’s Regulations. (2) Except in the case of lost tickets, refunds will only be made on surrender to SCAL of the passenger coupon or passenger receipt and surrender of all unused flight coupons, and the conjunction tickets if any. For electronic tickets, refund must be applied not later than 13 months after the date of commencement of travel or the date of issuance (for all first flight coupon unused ticket). Application for refund will only be accepted when the coupon’s status is OPEN FOR USE, and with payment proof provided by passenger. (3) When refunding an electronic ticket, passenger is required to provide printed itinerary. Article 59 Person Receiving Refunded Fares (1) SCAL shall be entitled to make refund to the person named in the ticket. (2) If a ticket has been paid for by a person other than the passenger named in the ticket, and SCAL has indicated on the ticket that there is a restriction on refund, the refund will be made only to the person paying for the ticket or to that person’s order. (3) Passenger or payer who requests the refund shall present his or her valid identity certificate. If the person requesting refund is not the passenger or the payer, he or she must present the identity certificate of himself or herself and the authorization from the passenger or payer in addition. (4) A refund made pertain to Article 59 to anyone whom refund may be made in terms of (1), (2) and (3) of this Article shall be deemed a proper refund and shall discharge SCAL from liability and any further claim for refund. Article 60 Time limit for refund Refund must be applied not later than 13 months after the date of commencement of travel or the date of issuance (for all first flight coupon unused ticket). Application for refund will not be accepted after the time limit. Article 61 Place of refund (1) On principle, refund of tickets and MCO shall be processed in the original place of payment; exchanged tickets can also be refunded in the place of exchange. In the event of involuntary refund, refund can be processed in SCAL’s sales office in the place of original purchase, commencement of journey, stopover, or breakpoint of travel, or in SCAL’s authorized sales agencies in the place where the cause of involuntary refund happens. When passenger applies for refund in a place other than the original place of issuance, the SCAL’s sales office which is to process refund shall obtain authorization from the original place of issuance, and refund in the local currency at that day’s BBR according to the refunded amount provided by original place of issuance. (2) When passenger holding an open ticket applies for refund, refund must be processed in the original place of issuance. Article 62 Currency All refunds will be subject to Government laws, rules and regulations or orders of the country in which the ticket was originally purchased and of the country in which the refund is being made. Refunds will normally be made in the currency in which the ticket was paid for, or in another currency in accordance with SCAL’s regulations. Article 63 Involuntary refunds (1) Involuntary refund refers to any refund applied for by passenger entitled to travel on SCAL’s flights who cannot be carried according to carriage contract due to such uncontrollable or unpredictable reasons as weather, air traffic control, aircraft maintenance, flight readjustment. (2) Involuntary refund abides by the following rules: 1. If no portion of the ticket has been used, an amount equal to the fare paid including taxes and charges will be refunded, without charging refund fee. 2. 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The World BusinessMirror

Friday, June 29, 2018

Trump’s trade war pushes China closer to old foe India

resident Donald J. Trump’s moves to protect US trade interests are creating unusual bedfellows in Asia. India and China, longstanding economic and strategic rivals, are seeing a thaw in relations less than a year after the most serious border f lare-up since a war in 1962 threatened ties between the two Asian giants. Since May China has made it easier for India to export non-Basmati rice, removed import duties on anticancer drugs and agreed to share data that predicts river flows between the two countries during the flood season. Chinese President Xi Jinping and Indian Prime Minister Narendra Modi have met twice since April, pledging to strengthen bilateral ties. Driving the marriage of convenience is Trump’s unpredictable policy-making. The United States has ratcheted up global trade tensions with tariff threats against China, Canada, Mexico and the European Union, prompting several to retaliate. Last week India also joined the fray, raising duties on a slew of US imports. “China understands that this trade war situation isn’t going to end in a few days or even months,” said Bipul Chatterjee, executive director of an Indiabased trade think tank. “They wouldn’t want to open more than one battle front. The focus is now on confronting the US.”

‘Trump factor’

The question many observers are asking is whether China’s cozier relationship with India

can endure. T he world ’s t wo most- popu lou s n at ions h ave had a tense histor y, marked by border disputes and China’s growing economic inf luence in South Asia. “ I don’t t h i n k t he f u nd amentals of the relationship are changing in any way, but the Trump factor is pushing them to coordinate their priorities more closely,” said Harsh Pant, an international relations professor at King’s College London.

Trade gap

India’s two-way trade with China touched nearly $90 billion last year, making it the largest commercial partner of the South Asian economy. The bilateral trade gap was $63 billion—India’s largest—mainly due to imports of Chinese-made heavy machinery, telecom equipment and home appliances, according to commerce ministry data. Modi’s flagship “Make in India” initiative to foster local manufacturing struggles in the face of low-priced imports from China, while at the same time India’s cost-competitive software services companies battle to get access to the Chinese market. “It is a very hard nut to crack,” said Srikanth Kondapalli, a professor at the Center for East A si a n St ud ies at Jawa h a rl a l Nehru University in New Delhi, referring to the China market. Still, the Chinese have managed

President Xi Jinping and Prime Minister Narendra Modi pledged to strengthen bilateral ties. Bloomberg

to dominate India’s power equipment market and push telecom products, he said. To curb the shortfall—and counter to China’s easing of trade barriers—India boosted tariffs on electronic goods, such as mobile phones, TVs and microwave ovens last year.

Border spat

Closer trade ties seem incongruous less than a year after troops from the two nuclear-armed nations faced off in a dispute in the remote Doklam Plateau between India, Bhutan and Tibet, triggered by China’s attempt to build a road there. Tension eased after the two countries agreed to an “expeditious disengagement” of troops from the area in late August, with Modi and Xi later pledging to strengthen communication between their respective armies at the informal summit this April. Sino-Indian relations have long been marred by disputes over large tracts of land along the border. India’s hosting of the Dalai Lama and the Tibetan government-in-

exile in the mountain town of Dharamsala in northern India is also a source of anger in Beijing.

Belt and road

Another sore point in the bilateral relationship has been China’s ambitious global infrastructure plans, which include projects in New Delhi’s Indian Ocean backyard that domestic analysts worry have a strategic dimension. Under the so-called Belt and Road initiative, China has financed ports and roads from Myanmar to Sri Lanka and Pakistan. India is one of the only holdouts globally. At a recent foreign ministers meeting of the Shanghai Cooperation Organization, a China-led group, India was the only member country not to endorse China’s Belt and Road plans. Drawing the most alarm for India is the $60 billion China Pa k istan Economic Cor r idor, which runs through Pakistanadministered land in the disputed border region of Kashmir. New Delhi claims the region as its own territory. Bloomberg News

Mattis, Chinese leaders strike positive tone despite tensions

U.S. Defense Secretary Jim Mattis (center left) and China’s Defense Minister Wei Fenghe stand together during a welcome ceremony at the Bayi Building in Beijing on Wednesday. AP Photo/Mark Schiefelbein

EIJING—US Defense Secre t a r y Ji m M at t i s a nd C h i nese le aders st r uc k a largely positive public tone Wednesday, talking up increased military cooperation and open dialogue between the two powers despite security tensions and an impending trade war. Mattis was on his first trip to China since taking the lead at the Pentagon. He met President Xi Jinping and Defense Minister Wei Fenghe. In public comments, the two sides avoided mention

of the topics that have recently dominated the relationship and ate up portions of the talks—Taiwan, Chinese militarization of the South China Sea and North Korea’s nuclear program. Instead, they focused on the importance of the US-China military relationship—which Xi, who also heads the commission overseeing the People’s Liberation Army, called the “model component of our overall bilateral relations.” “This is an important time in the history of China and the

United States as we work our way forward,” Mattis said as he sat with Xi in front of a bank of cameras and photographer who attended the meetings. He said that, when areas of disagreement came up, Mattis made the US positions clear, including its long-standing and widely shared opposition to China’s militarization in the South China Sea. “It’s not for one countr y to diminish what are international rights for navigation as defined in international waters,”

Schriver said. The meetings also came as a trade war brews between the world’s two largest economies. US President Donald J. Trump has already imposed tariffs of 25 percent on imported steel and 10 percent on aluminum. And next week the US is to start taxing $34 billion in Chinese goods and later add tariffs on an additional $16 billion in goods. Beijing has vowed to immediately retaliate with its own tariffs on US soybeans and other farm products. The trade issue, which isn’t in Mattis’s security portfolio, came up but was not a significant part of the conversations, said Dana White, Pentagon spokesman. “What was consistent was the desire for a consistent military-tomilitary relationship as a stabilizing factor of the overall relationship,” said White. Schriver said North Korea came up in every meeting, with both sides agreeing on the broad goal of denuclearization of the Korean Peninsula and the need to support UN Security Council resolutions on sanctions against the North. The US is hopeful that Beijing, an ally of North Korea, can help push Pyongyang to follow through on its denuclearization commitment made at a summit between leader Kim Jong Un and Trump two weeks ago. Uncer tainties remain over Nor t h K orea’s i ntent ions. It is still making improvements to infrastructure at its main Nyongbyon nuclear complex, according to an analysis of June 21 commercial satellite imagery by 38 North, a Washington-based web site that closely tracks developments inside the isolated nation. AP

www.businessmirror.com.ph

Oil trades near highest level since 2014 after US inventories plunge

il traded near the highest level since 2014 after government data showed US crude inventories fell by the most in almost two years and exports climbed to a record. Futures in New York lost 0.4 percent, paring a 6.9-percent surge in the previous two sessions. US stockpiles declined by 9.89 million barrels last week, the most since September 2016, the Energy Information Administration reported Wednesday. American crude exports rose to a record 3 million barrels a day, according to the agency, while concerns remain involving the pipeline bottleneck in the Permian region. Prices have been on an upward swing as US President Donald Trump’s administration seeks to dissuade purchases of oil from Iran, the Organization of Petroleum Exporting Countries’s third-largest crude producer. The efforts to isolate and hobble the Islamic republic have overshadowed Saudi Arabia’s plan to lift output to a record within weeks following Opec’s agreement to relax output caps. “The big draw in US stockpiles,

definitely bigger than expectations, gave a real boost to the market,” Will Yun, a commodities analyst at Hyundai Futures Corp., said by phone from Seoul. “But investors are a bit wary as to whether this rally will continue, as there are many factors that could drag down prices, such as an actual increase in Opec production. It could change direction at any time.” We s t Te x a s I nt e r m e d i at e crude for August delivery traded at $72.49 a barrel on the New York Mercantile Exchange, down 27 cents at 8:48 a.m. in Singapore. The contract rose $2.23 to close at $72.76 on Wednesday, the highest sett lement since November 2014. Total volume traded was about 65 percent below the 100-day average. Brent futures for August settlement lost 5 cents to $77.57 a barrel on the London-based ICE Futures Europe exchange. Prices on Wednesday climbed $1.31 to $77.62. The more active September contract was 6 cents lower at $77.40. The global benchmark traded at a $5.12 premium to WTI for August. Bloomberg News

Pence: Trump, Putin expected to discuss election meddling

ice President Mike Pence said he expects President Donald J. Trump to discuss Russian meddling in US elections, the Kremlin’s military incursions into Ukraine and Syria and other touchy subjects when he meets this summer with Vladimir Putin. “There are a broad range of issues the president’s going to talk about that need to be addressed,” Pence said in an interview with Bloomberg News aboard Air Force Two on Wednesday. They include the “economic relationship with the United States and Russia and countries of the world.” Asked whether those issues would include concerns over Russian interference in US elections, Pence said, “I think there will be a lot of stuff that comes up.” Pressed again, he said, “He’s discussed that with President Putin before. I would anticipate that he will discuss that with him again.” The US intelligence community has concluded that Moscow attempted to influence the 2016 election that Trump won. The president has shown reluctance to accept that Russia played any role in the election and has forcefully rejected assertions that the Kremlin helped him win. His campaign is under investigation by

Special Counsel Robert Mueller for contacts with Russian figures and potential collusion with the Kremlin’s election activities. Mueller has indicted a Saint Petersburg “troll farm” with connections to the Russian government for running a covert social-media campaign to influence the election. Trump has said he’s confronted Putin about Russia’s involvement in the election in previous meetings, and the Russian leader has denied any meddling. However, the president has enacted new sanctions Congress ordered against Russia to punish the country for its election activities and hasn’t lifted sanctions put in place by his predecessor, Barack Obama. The president startled other Western leaders earlier this month when he said Russia should be readmitted to the Group of Seven on the eve of its annual summit in Quebec. The country was expelled from the group of industrialized democracies after its aggression toward Ukraine and its 2014 annexation of Crimea. Pence declined in the interview to share his own view on whether Russia should be allowed back into the G7. “Any opinion I have, I’d share with the president,” Pence said. Bloomberg News

Beijing tries to defuse trade pressure

EIJING—China’s government defended its trade record as a benefit to the world in a new effort Thursday to defuse US and European pressure over market access and technolog y policy. A Cabinet repor t repeated promises to cut some tariffs and ease controls on foreign investment but mentioned no new initiatives. It didn’t address complaints that Beijing hampers access to promising industries and that plans for state-led development of Chinese champions in electric cars and other industries violate its free-trade commitments. President Dona ld J. Tr u mp has t hreatened t a r if f h i kes on up to $450 bi l l ion of C h inese impor ts in response to compl a ints Beijing stea ls or pres su res compa nies to ha nd over tec h nolog y. C h i n a h a s t r ied to recr u it Eu rope as a n a l ly in t he d ispute but a lso faces compl a i nts by Ger m a ny a nd other gover nments that it bars pu rc h a ses of C h i nese a ssets wh i le its ow n compa nies a re on a globa l acqu isit ion spree. “China has lived up to its responsibility as a major country,” said the report. It said China’s

growth has contributed to “global peace and development.” It was the latest attempt by President Xi Jinping’s government to def lect pressure for change by emphasizing the benefits of trade with the world’s second-largest economy. Beijing has offered to narrow its politically volatile trade surplus with the United States but has resisted pressure to roll back ambitious technology plans. The ruling Communist Party sees those as a route to prosperity and global influence. But its trading partners complain Beijing improperly subsidizes fledgling Chinese suppliers and shields them from competition. Chinese officials have tried to appeal to Europe by promising to buy more of its farm goods and saying its companies are welcome to invest. T hey repeated that message during visits by German Chancellor Angela Merkel in May and French Premier Edouard Philippe this week, though they did not directly address complains about market and investment barriers. Merkel and other European officials are frustrated by Trump’s tactics but say they are not allying with Beijing. AP

The Regions BusinessMirror

www.businessmirror.com.ph

Editor: Dennis D. Estopace • Friday, June 29, 2018

Mindanao towns told to define water jurisdiction

By Manuel T. Cayon

@awimailbox Mindanao Bureau Chief

Fatima M. Idris, regional director of the BFAR, said the issue of exclusivity of municipal waters in and around Davao Gulf is “contestable.” The gulf ’s 520-kilometer coastline covers 18 municipalities, 5 cities and 4 provinces in southeastern Mindanao. In the case of Davao City and Sama l Island, t he nar rowest strait between them in Babak side of Samal and in Lanang side has only a water expanse of less than 7 kilometers. A town or province is allowed to have jurisdiction over municipal waters stretching 15 kilometers from the shoreline. There is also the lack of delineation

of municipal waters among towns in the provinces of Davao del Sur, Davao Occidental, Davao City, Davao del Norte, Compostela Valley and Davao Oriental. It has not been an issue, however, in the gulf, for as long as local governments would not bar fishermen from any of these provinces to encroach into waters directly facing other provinces. Idris said the practice has allowed unhampered fishing. “Fishermen have been doing this for a long time already. They even fish outside of Mindanao,” she said. Filipino fishermen, though, have been periodically arrested by

West Visayas minimum wage hike takes effect July 12

ACOLOD CITY—An increase of P13.50 to P41.50 in the daily minimum wage of private-sector workers in Western Visayas is set to take effect on July 12. Department of Labor and Employment 6 (Western Visayas) Director Johnson Cañete said the National Wages and Productivity Commission has not made major changes in Wage Order 24, which prescribes the latest wage increase. The Regional Tripartite Wages and Productivity Board (RTWPB) 6, which is chaired by Cañete, published the wage order on June 27, or 16 days after it was signed by the members. The guidelines state that the new order should take effect 15 days after publication in newspapers of general circulation. “We would like to inform our employers that the new wage order is immediately effective on July 12,” Cañete said in an interview on Wednesday. “By that time, it should be reflected already in the pay slip,” he added. In Wage Order 24, the approved increase of P13.50 to P41.50 includes the cost-of-living allowance. Wage rates in Western Visayas will now range from P295 to P365, up from P271.50 to P323.50 under Wage Order 23. Meanwhile, any party may file an appeal or motion for reconsideration within 10 days after the wage order takes effect. Section 8 of Wage Order 24 states that companies may seek exemptions from the implementation if they fall into three exceptional circumstances, namely, if establishments are distressed, if these are new business enterprises and if affected by calamities. Cañete said RTWPB 6 will conduct an information dissemination campaign in the region’s provinces through press conferences, forums and orientations regarding the latest wage order. He added that they will also gather Public Employment Service Office managers, human resource heads, guidance counselors and other stakeholders to discuss Wage Order 24. Wennie Sancho, labor representative to RTWPB 6, said any additional pay of the workers would become part of domestic spending that would, in turn, pump prime the economy. PNA

Foreign firms, telcos eye NPA hotbed in Davao

avao City—The regional office of the Bureau of Fisheries and Aquatic Resources (Bfar) here said coastal towns surrounding the Davao Gulf should clarify the jurisdiction of overlapping or shared municipal waters.

This file photo shows tuna caught in Davao Gulf. An official of the Bureau of Fisheries and Aquatic Resources urged towns and provinces in Southeastern Mindanao to delineate municipal waters following the agency’s order to temporarily ban fishing in the gulf. D.A. PHOTO

Indonesian and Palau authorities for encroaching into their fishing grounds as Filipino fishermen follow the trail of the tuna along the tuna highway, which include part of the waters off Southern Mindanao. Foreign poachers have also been ar rested by the Phi lip pine Navy. Two Taiwanese fishi ng boats were apprehended of f the Davao Gu lf in 2012,

according to Idris. She said, however, that towns and provinces around the gulf should pass an ordinance if they want to have exclusive authority over the fishing grounds or agree to a sharing arrangement with adjacent localities. This would avoid f ut ure lega l problems, she said. Idris issued the announcement after the BFAR issued an order to

close the gulf for three months beginning June to allow fish species to spawn freely. The BFAR adopted the same strategy implemented in the Zamboanga Peninsula and started imposing a three-month fishing ban at the gulf in 2014. It is during this closed season that fishermen would usually venture out of municipal waters to explore richer fishing grounds.

Aboitiz empowers Benguet women-led cooperative

hrough trainings and financial assistance, the A boit i z Group a ssi st s B e ng uet - ba se d co op er at ive Thanksgiving Multi-Purpose Co o p e r at ive ( M P C ) to pay it forward to its community members. The livelihood association wa s for med by 16 Beng uet women following the 1990 Luzon earthquake and for over a decade has been engaged in various livelihood programs. From a mere consumer store, it has evolved into a multibusiness cooperative offering loans, savings and time deposits, and other services, such as photocopying and bookbinding, among others. The Aboitiz Foundation, the corporate foundation of the Aboitiz Group, has been proving capability building training sessions to empower Thanksgiving’s members and officers since 2009. “We learned about the current trends and information related to managing a cooperative and became compliant with Cooperative Development Au-

thority’s training requirements through trainings and seminars provided by the Aboitiz Group,” Emma Golocan, Thanksgiving MPC general manager, said in a statement. Through the foundation’s financial assistance and livelihood skills training, the cooperative’s officers and members were able to exponentially grow their small swine fattening livelihood projects. “Our cooperat ive star ted with a capital of P102,500 and now I am proud to say that we have assets amounting to P68,403,878.67,” Golocan noted. Thanksgiving MPC gives back to communities by conducting medical and dental missions, cleanup drives, tree plantings, and by supporting the government’s annual Brigada Eskwela. On top of this, 10 percent of its annual net income is donated to the church as religious tithes. Thanksgiving MPC has made itself an important ally of the government in making the communities it serves better places to live in. “ T he A boit i z Fou nd at ion

inspires us to help communities improve their well-being. In our little way, makatulong din kami. Alam namin na ang paraan para maibalik ang tulong sa amin ng Aboitiz Foundation ay tumulong din kami sa kapwa,” Golocan said. As the cooperative continues to grow, the Aboitiz Foundation similarly continues to support more of its livelihood programs. Some Thanksgiving MPC members have already completed National Certifications II on Dressmaking or Baking and Pastry Production. These livelihood trainings have opened new business and employment opportunities to the cooperative and its members. The Aboitiz Foundation is the corporate foundation of the Aboitiz Group that was established in 1988. Since its inception in 1988, the foundation said its corporate social responsibilit y inter ventions have evolved from one-time donations to “carefully designed prog rams that empower its beneficiaries to pursue their aspirations.”

AVAO CITY—Three foreign investors and the two major telecommunication companies are giving a glimmer of hope for residents of Paquibato district, a known hotbed of communist insurgency in this city. Three weeks ago investors from the Japanese Oji Paper Co., and Taiwanese and Malaysian agriindustrial firms visited Paquibato’s Mapula and Salapawan villages to explore the possibility of putting up production plants, Lt. Col. Darren Comia, commander of the Army’s 16th Infantry Battalion operating in the area, said on Wednesday. Te le com mu n ic at ion f i r m s Globe and Smart, which earlier expressed to Davao City Mayor Sara Duterte-Carpio that they wanted to set up towers to connect Paquibato to the information highway, have also visited the area recently, Comia said, citing the investors’ interest in Paquibato as a positive sign for the area’s economic development. Paquibato, a known lair of the New People’s Army (NPA), has been lagging behind in terms of socioeconomic development because of its peace and order situation. During Wednesday’s Armed Forces of the Philippines-Philippine National Police Press Corps briefing at the Royal Mandaya Hotel, Comia said the interior villages of Mapula and Salapawan are key to the government’s effort to develop the entire district. The Army official said that due to its elevation, Paradise Embak has been eyed as an ideal site for telco companies to put up their facilities. Still, Comia acknowledged the need to further strengthen Paquibato’s peace and order condition, noting that this was the investors’ main concern. He said the military remains committed to protect investments in the area and ensuring that the local government’s development agenda is sustained. Paquibato is now the focus of the city government’s peace and development program after the launch of the Davao City Peace 911, an initiative to bring better “social services, infrastructure, livelihood” and other forms of interventions. Recently, Comia said the City Engineer’s Office has inspected vital roads for ease of access to Paquibato district, which has 13 barangays—Colosas, Fatima, Lumiad, Mabuhay, Malabog, Mapula, Panalum, Pandaitan, Paquibato Proper, Paradise Embak, Salapawan, Sumimao and Tapak. Earlier, the National Economic and Development Authority’s (Neda) regional office in Davao vowed to pour billions’ worth of infrastructure projects in Paquibato to help alleviate its residents’ living conditions. PNA

A10 Friday, June 29, 2018 • Editor: Angel R. Calso

Opinion BusinessMirror

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editorial

China’s debt slaves

oncerns over the Philippines taking on too much international debt to fund the current administration’s infrastructure projects are valid. However, the discussion seems to be overshadowed by what appears to be “Sinophobia” and hidden geopolitical agendas as the Philippines broadens its alliances.

The line between propaganda and persuasive arguments is very blurred. From reading and hearing the discussion, many commentators are having a difficult time presenting hard facts in the midst of hysteria. And often all we hear is Sri Lanka. “Sri Lanka. Look what happened to Sri Lanka.” In March a US think tank formed in 2001 and focusing on international development released a lengthy examination of the situation. In a study, “Examining the Debt Implications of the Belt and Road Initiative from a Policy Perspective,” the Center for Global Development (CGD) examined China’s ‘Belt and Road Initiative.’ “If the initiative follows Chinese practices to date for infrastructure financing, which often entail lending to sovereign borrowers, then BRI raises the risk of debt distress in some borrower countries.” That is something we in the Philippines want to hear about. CGD said: “This paper assesses the likelihood of debt problems in the 68 countries identified as potential BRI borrowers. We conclude that eight countries are at particular risk of debt distress.” To begin with, CGD identified three countries in East/Southeast Asia most vulnerable to debt problems: Cambodia, Mongolia and Lao PDR. Had any of the current China debt experts bothered to read this substantial report, they would have learned that the only time the Philippines was mentioned in the 39-page report was to note that the Philippines was one of 14 countries in the region (including all of the Asean and South Korea) that “fall under the scope of BRI.” Nonetheless, political agendas in 2018 are never supposed to let facts get in the way of the narrative. Also, the CGD conclusions are important because not only does CGD do research but also provides—on a nonprofit basis—policy initiatives to countries to keep them out of debt trouble. Mahinda Rajapaksa was president of Sri Lanka from November 2005 to January 2015. Rajapaksa may not top the list for financial corruption, nepotism, incompetence, political favoritism, cronyism and faking his nation’s economic data. He would be a closer runnerup in all categories. Perhaps the pinnacle of his failure was the Hambantota Port in southern Sri Lanka built by a Chinese company and funded by Chinese loans. Rajapaksa’s vision for Hambantota was that it would bring more ships to Sri Lanka, and ease pressure on the Colombo Port. But there are no industries near the port that would be its natural customers. Should we mention that Rajapaksa is from Hambantota district, and his family has been the main political force in the area since colonial days? Further, credible claims of election fraud have followed Rajapaksa since his earliest political life. We the people have an obligation to hold the President, his cabinet and all government agencies and officials to absolute transparency, truthfulness and accountability with all government projects and borrowings. In order to effectively achieve that, we must keep the political propaganda out of the discussion. Since 2005

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Updates are needed James Jimenez

spox

lection management isn’t a walk in the park. You are charged with enforcing rules that are deliberately designed to limit what candidates and political players can do. This can make election rules frustrating, and election rule enforcers, villains. Unfortunately, election rules do need to be oriented this way— otherwise, it would be very easy to tilt the playing field in favor of the wealthy, the popular and the unscrupulous. If everything were allowed, then the person willing to do anything would win all the time, yes? And so, it is what it is. Or “was.” The funny thing is that the bulk of our current election rules are actually pre-turn of the century. The Omnibus Election Code, for example, was enacted in 1985, making it more than three decades old—and, if it were a person, too old to have run for office in the last Sangguniang Kabataan elections. Republic Act 7166—the reason national and local elections take place on the same day—was signed into law on November 26, 1991, 27 years ago; Republic Act 8189—the

law governing the registration of voters—was enacted on June 11, 1996, making it 22 years old. Even the Fair Election Act, which to this day governs the conduct of campaigns, and decrees what is and what is not lawful election propaganda, has already been around for more than a decade. And while I agree that laws ought to be long-lived, providing stability and predictability over the longest term possible, consider how different our collective national situation

is, from what it was in 1985. Quite apart from the fact that we now have personal mobile devices with more computing power than it took to get a man on the moon, our cities are bigger than they used to be, individuals are less likely today to stay where they are and money buys less per peso than it used to— and still we insist on rules like a P3 per voter spending limit. The long and short of it is that our archaic—and in some cases, obsolete—election rules need to be updated. And to make that happen, everyone needs to contribute to the effort. From the election-management body—the Comelec—there must be first, a definitive index of what needs changing, as well as a comprehensive set of proposals that can provide Congress with a starting point for their deliberations and law craft; second, a willingness to reexamine existing rules and arrangements with a critical eye, regardless of how disruptive of the status quo such objectivity might be; and third, an openness to new ideas and solutions, even those that seem at first glance to have no hope of working. From the public, there must be popular and vocal support for

‘Uniting the world against terrorism’

By Antonio Guterres | UN Secretary-General

errorism is a persistent and evolving global menace. No country is immune. Social media, encrypted communications and the dark web are being used to spread propaganda, radicalize new recruits and plan atrocities. The threat ranges from the crude tactics of lone actors to sophisticated coordinated attacks and the horrific prospect of terrorists using chemical, biological or radioactive weapons. Our response needs to be equally agile and multifaceted. That is why I am convening the first-ever United Nations High-level Conference on Counter-Terrorism this week in New York. Heads of national counterterrorism agencies and representatives from international institutions and civil society will discuss how to improve international cooperation and build new partnerships. The conference will focus on four key areas. First, it will consider how governments, security agencies and law-enforcement bodies can improve the exchange of critical information and strategies to detect, disrupt and prosecute terrorist networks. Second, the conference will discuss how the United Nations can do more to assist countries around the world affected by terrorism. Third, it will address the threat posed by foreign terrorist fighters. With the military defeat of ISIL in

Syria and Iraq, large numbers of these ideologically driven mercenaries are relocating to other theatres of conflict or returning home, passing on their battlefield expertise, recruiting new followers and planning further attacks. Fourth, I intend the conference to focus on how we can prevent terrorism and violent extremism. Improved security will never be enough. We need to address the underlying conditions that make people susceptible to toxic ideologies. Terrorism is a transnational threat that cannot be defeated by any single government or organization. It needs a concerted multilateral response at global, regional and national levels. It is essential to strengthen counterterrorism structures and institutions. But we must also address root causes by promoting education, tackling youth unemployment and addressing marginalization. That

means engaging with local communities, religious organizations and the media. Civil society is central to the conference and our broader counterterrorism strategies. Clearly, the response to terrorism and violent extremism must respect human rights and comply with international law. That is not just a question of justice, but of effectiveness. When counterterrorist policies are used to suppress peaceful protests and legitimate opposition movements, shut down debate, target human-rights defenders or stigmatize minorities, they fail and we all lose. Indeed, such responses may cause further resentment and instability, and contribute to radicalization. No cause or grievance can justify terrorism. But we will only diminish the threat by ending the conflicts, human-rights abuses, poverty and exclusion that drive so many to violent extremism. Most new recruits to terrorism are between 17 and 27 years old. We must offer them better prospects, economically and socially. And we must reverse the polarization, xenophobia and hate speech that are proliferating around the world. Let us also remember the tens of thousands of people killed, wounded and traumatized by terrorism. Survivors need our support in seeking justice and rebuilding their lives, both

these changes—in principle, at least, even if not for the actual proposals themselves—so that the people’s representatives in Congress are motivated and cheered on to work for these changes. More than that, the public must dig themselves out of their entrenched positions and biases, and share ideas that are actually intended to bring about better ways of doing things, rather than ideas rooted in fear and distrust. And from Congress itself—well, a renaissance in electoral management will never materialize if the lawmakers show no determination to amend existing election laws for the purpose of creating a fairer, more responsive and more realistic set of rules of the game. Come to that, changes in the laws and rules, let alone the electoral system in general, will never happen unless everyone pitches in. Compared to what’s possible with a combined and coordinated cooperative effort from the Comelec, the public and Congress, there really is precious little that can be achieved with simply shouting yourself hoarse in frustration. Many of us have tried shouting—I think it might be time to try helping each other out.

financially and psychologically. We must also listen to them and learn from their experiences. Finally, terrorism and violent extremism have a profound gender dimension. Terrorists continue to violate the rights of women and girls through sexual violence, abduction, forced marriages and preventing free movement and access to education. Involvement in domestic abuse is a common thread among many perpetrators. That is why we must urgently prioritize the rights, participation and leadership of women. The international community has come a long way in its efforts to counter terrorism. There is a clear international framework that makes it easier to prosecute terrorists, disrupt their financial networks and prevent online radicalization. But there is much still to be done. Terrorist groups share an agenda of authoritarianism, misogyny and intolerance. They are an affront to the common values encapsulated in the United Nations Charter and the Universal Declaration of Human Rights. Our responsibility is to unite to build a world of peace and security, dignity and opportunity for all people, everywhere, so we can deprive the violent extremists of the fuel they need to spread their hateful ideologies.

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A true leader will serve God and will not blaspheme Him Rev. Fr. Antonio Cecilio T. Pascual

SERVANT LEADER

great leader speaks and acts not by his own deeds, but by the words and power of God. “It is a conviction of a true leader that the entrusted power of position becomes a tool to uplift others who are in need.” It is true, indeed, that a leader must serve God first before he serves the people of God. This notion is what Manila Archbishop Luis Antonio Cardinal Tagle, DD, said that a leader must come “not to be served but to serve.” Unfortunately, it is undeniable that most of the leaders today do not put God in their service. It is excruciating to know that the word, and even God Himself, was being set aside when we have the power of arms and wealth. My dear brothers and sisters in Christ, what I am referring to is the recent statement about God who was called “stupid.” It is undeniable that our President is a sharp-tongued person from the very beginning; however, it is clearly shown that he already crossed the line by calling God stupid. This kind of statement is a form of sin called blasphemy, and let us not forget that “the one who blasphemes the name of the LORD shall surely be put to death; all the congregation shall certainly stone him. The alien as well as the native, when he blasphemes the Name, shall be put to death” (Leviticus 24:16). It is really disturbing to know the fact that this kind of words will be

coming out from a leader who controls a state where almost all of the people are Catholics. This is also in accordance with what Kalookan Bishop Pablo Virgilio David, DD, pointed out that “how can one be a president for all Filipinos if he does not have respect for the Catholic faithful?” My dear Catholic faithful, we are now in the time where our faith is being challenged, and it is good for us to “rethink what leadership is, and to locate its true meaning in servanthood.” It is a good opportunity for us to reflect upon these kinds of acts and words of our leader. Let us not forget that we are born as children of God, and that the Holy Spirit is with us, and we must stand for it against any form of attack of the enemy. Let us unite and use the power of our Lord Jesus Christ to defend our faith. To know more about Caritas Manila, visit or follow us on Facebook: CaritasManilaInc. For your donations, please call our DonorCare lines 5639311, 564-0205, 0999-7943455, 09054285001, and 0929-8343857. Make a habit to listen to Radio Veritas 946 in the AM band, or through live streaming at www.veritas846.ph and follow its Twitter and Instagram accounts @veritasph and YouTube at veritas846.ph. For your comments, e-mail veritas846pr@gmail.com.

Airlines shouldn’t fear China’s boycott threats By Adam Minter Bloomberg Opinion

he Chinese government has given the world’s airlines until July 25 to recognize Taiwan as part of China. So far, Delta Air Lines Inc. and American Airlines Group Inc. are among the very last holdouts. According to Bloomberg News, if the companies don’t comply, China could“prompt travelers from the mainland to boycott American airlines.” The airlines are understandably concerned about this threat, given that China is a key growth market. But the fears are overblown: Chinese consumer boycotts have historically been short-lived and relatively painless, and there’s little reason to believe that this one will turn out any differently. The airlines are caught up in a long-running dispute. China regards Taiwan as a wayward province, and its self-image and geopolitical vision are deeply connected to reunifying the two territories. Pressuring foreign companies to refer to Taiwan as part of China—on tickets, web site drop-down menus and so forth—is a means of advancing its foreign policy. But like shoppers anywhere, China’s consumers tend to be valueoriented more than anything else, and surveys indicate that while patriotism plays a role, their purchasing decisions, quality, brand and price are typically far more important. Hence a decade’s worth of short, overhyped Chinese boycotts. The first notable one occurred in April 2008, after a Tibetan activist attempted to seize the Olympic torch as it was paraded through Paris. In Shanghai and other cities, protesters surrounded stores owned by French supermarket chain Carrefour SA as part of a general boycott. Keeping up that effort proved challenging, though, especially in China’s summer heat. And before long, Chinese had turned their attention to other matters—like the Olympics. Less than three months after the closing ceremonies, Carrefour announced 10 new store openings in booming south China. Shoppers flocked to them. Similarly, after a territorial dispute with Japan erupted into violent protests across the mainland in August 2012, a boycott caused Mazda Motor Corp.’s sales to decline by 36 percent.

But that drop, too, was short-lived. By November, sales were recovering (even as China faced its worst auto-market growth in a decade) and by April Japanese car exports were up by more than three-and-a-half times over their October low. (Post-boycott discounts likely helped.) Protests targeted at specific corporate missteps also typically fizzle. Last year footage of passenger David Dao—who is partly of Chinese descent—being beaten and dragged off a United Express flight in Chicago received tens of millions of views per hour in China, sparking calls for boycotts and widespread speculation that the airline’s reputation would be permanently damaged among Chinese consumers. Despite the fury, United remains the largest foreign operator between China and North America. Where company boycotts have been more successful, they’ve usually coincided with bigger problems. For example, when South Korea agreed to host an American antimissile system in 2017, a resulting protest appeared to put a big dent in Korean car sales in China. But that decline had actually begun before the protest, partly due to stiffening local competition and a poor mix of models on offer for the Chinese market. China’s enthusiasm for other South Korean products—such as soap operas and cosmetics —continued unabated. For similar reasons, Chinese passengers are unlikely to sustain a boycott of US airlines. The government has long restricted domestic competition on the most popular routes to North America. And customers looking for choice, convenience and seamless transfers to US cities will naturally turn to American carriers to provide them—however they refer to Taiwan. Few fliers are going to choose Air China over Delta if Delta’s prices and travel times are superior. Of course, even a brief boycott can inflict damage. And the airlines can’t dismiss this controversy entirely; China could also impose measures, such as air-traffic control delays and intensified inspections. But like their counterparts everywhere else, Chinese consumers are far more interested in whether a product meets a need and a budget—and far less on whether it was made by a rival.

Friday, June 29, 2018 A11

A blast from a revolutionary past Tito Genova Valiente

annotations

n June 30 the country is celebrating “Dia de la Amistad Hispano-Filipina,” marking the start of the PhilippineSpanish Friendship Week.

The world has changed, indeed. Not so long ago—if we reckon by historical time it was not ancient history—there was a movement that could never have imagined that, one day, this country and Spain would be amistades or friends. That was the Katipunan and in this exciting book currently occupying my time can be found memories that are altogether bitter about Spain and its years of colonization in the Philippines. The book is entitled “The Light of Liberty: Documents and Studies on the Katipunan.” Many of the thoughts and ideas contained in the book have been taught in our history and social studies classes from elementary to high school and college. The author, Jim Richardson, however, has made it easy for many of us by not only compiling the documents but also translating the Tagalog texts and transcribing them. The two versions of the Katipunan’s founding statutes of 1892 are in the book, and records of the Supreme Council. The description of the initiation rituals are an intriguing read and so are the letters of Andres Bonifacio and Emilio Jacinto. Much as we have listened to our teachers speak about the Katipunan, the book allows us something deeper —a view of the so-called primary resources. Now, we can read Bonifacio’s “Decalogue” and Jacinto’s “Kartilya,” transcribed from difficult Tagalog, freeing us, too, from deciphering the codes, as in the case of documents written in ciphers, and penmanship common in that era. Our heroes knew how to document then, perhaps to prevent us from what Karl Marx has forewarned about history repeating itself first, as

tragedy, and second, as farce. Going through a document which bears the title “Casaysayan,” one senses a tragic consequence of not knowing about histories. The document contains the reasons enumerated by the Katipunan for separating from Spain. All throughout the statements, the writers of “Casaysayan” refer to Spain as mother and the Tagalogs/Filipinos as her children. “Casaysayan” is preceded by this statement: “Statement of the reasons for separating this Archipelago from the Mother who possesses her.” There was tenderness even in revolution! “Casaysayan” introduces the reasons with this sentence: “We have been impelled to separate from Sp… (Spain here but in the original Tagalog text it is “E,” meaning España) by her abusive behavior, hardheartedness, treachery and other degradations that no Mother should inflict upon the child…”It the begins to enumerate the reasons. Reason No. 1 talks about the “pitiless imposition of high taxes upon us, even on our bodies, even upon our produce or wealth.” Reason No. 2 is about the “expropriation of our meager profit if we practice any industry, so that we are kept weak and prevented from bettering ourselves.” The Katipunan cites for the third reason something still familiar, which is “the imposition of a high tariff on any goods that pass through customs.” Judge for yourself the sixth reason: “Allows our means of livelihood to be snatched away from us by any nation, above all by the Chinese who have not been educated or nurtured

in decent behavior, but only in deceit, robbery, and misery.” There are particularly strong and heartbreaking reasons, like the note on the “pretensions of the enlightened men [ilustrados].” The book, for a non-historian like this writer, is particularly engaging given the participation of Emilio Jacinto. Bonifacio, Rizal and del Pilar always appear as the major heroes —the lead actors—in this historical drama but, in the book, Jacinto looms bigger than what had been imagined for a long time in classrooms or in cinema. The letters of Jacinto are most compelling, showing us a man in full control of himself—respectful, tactful and sincere. In Jacinto’s letter dated December 23, 1896, to the High Council of the Northern District, he introduces the uncle of Juan Malinban, a prisoner in that area to which the letter is addressed. Jacinto asks the officers of the Northern District to release the prisoner so long as he is not allowed to go home. He also asks that the calesa and trap apparently stolen by Malinban be sent to him. Jacinto clarifies that the owner of the calesa has agreed already to the arrangement and besides, he needs a means of transportation because he has returned the carriage he has borrowed. In his postscript, Jacinto asks if there is anyone there in the Northern Council who knows about electric batteries. He wants to test the batteries before they are used in battle. The batteries are to be used for dynamite.

Measuring the poverty effects of policies Leonardo A. Lanzona Jr.

EAGLE WATCH

he uproar caused by a press conference of the National Economic and Development Authority early this month remains even as Neda authorities attempt to dissipate its aftereffects. To simplify their analysis of the impact of inflation on households, the Neda used P10,000 per month as a hypothetical income figure to indicate how a typical household would allocate this amount of income across different types of expenditures. The controversy emerged because the part of the media and then labor union leaders complained that P10,000 for a family with five children would be insufficient to live decently. Rightly so, the Neda denied making such a statement, and later added that roughly P42,000 per month would be needed for a family to enjoy a proper modest life. However, this clarification does not eliminate the main issue, i.e., inflation, not the true decent income. What the Neda could have done was simply to admit that P10,000 is not just any hypothetical number. Based on official records, in 2015, the poverty threshold for a family of five was P9,045. Their analysis could have then focused on how inflation could affect a family that had barely escaped poverty. The Neda missed the opportunity to show that inflation affects households differently, and that its impact on the poor is at even a larger scale. Since the goal was to examine the behavior of an average household, the Neda calculated the expenditures of various items from

the average expenditure shares. As shown in the table below, the poor actually has a larger food share in total expenditures relative to the rich.

assumed to be felt in transport costs. Second, there is a wide difference in the expenditure shares between the lowest income classes (below P3,333 per month) and the higher income classes (above P20,833 per month). In particular, the share of food is roughly two times for poor families compared to the well-off. The transport cost, however, are two times less for the lower income class. This is a well-known principle in economics that food is not income response. As incomes increase, households would spend the additional budget to nonfood items, thus resulting in lower food shares. Third, the source of inflation may be more important than the inflation itself. If inflation is coming mostly from high food prices, then its consequence is greater for the poor. Therefore, even if oil

Expenditure Share of Selected Household Items NEDA Estimates Food and non-alcoholic beverages Rice/bread and cereals* Electricity, gas and other fuels Health Transport Education

BASED ON 2015 FIES All income Below Above classes P3,333 P20,833 (Average) per mo. per mo.

0.383

0.419

0.608

0.353

0.096 0.074 0.039 0.081 0.033

0.117 0.079 0.037 0.062 0.038

0.245 0.091 0.019 0.031 0.003

0.078 0.079 0.043 0.069 0.046

Note: *Data from FIES are for bread and cereals. Source: PSA and News Report

Several points are noteworthy. First, the Neda estimates presented in the conference seem to be based on the national average where the differences can be attributed to their calculated impact of inflation. Much of the effect of inflation is

prices were to increase, but if food prices were kept at a lower level, the poor would somehow be more insulated from the adverse effects of inflation. Fourth, even if inflation is kept low, the poor will still face difficulty in maintaining other

In a letter to Julio Nakpil, Emilio Jacinto is talking about the arrival of weapons from Japan or Hong Kong. To the question of Nakpil whether the weapons had arrived, Jacinto replied that he has not heard of it and, instead, tells Nakpil to ask (following the transcription of Richardson) “Aguinaldo or better yet from Bonifacio because ‘we recognize him’, and he is now the only figure of authority involved in the fighting now going on there in the area of Cavite, according to what people coming from there say.” Jacinto even clarifies a point: “They say that Don E. Aguinaldo has now gone really quiet”—this to imply that Bonifacio is the active revolutionary. The letters reveal many things that mainstream, big history is wont to ignore. Richardson has this painstaking eye for details, as when he cites a letter of solicitation for funds to support the Katipunan. Bonifacio was already dead when the letter was sent, indicating that the movement in Manila continued on after his death, seemingly independent of the Aguinaldo government. Richardson notes that the letter coming from Manila was, ironically, not sent to any Manila elite, but to a Franciscan friar in Paete. There are many more historical gems in this book and I am reading them, including the footnotes. The tragedy is already happening in our society; let us not have the spirit for the farcical to take over and remind us we are indeed bad students of our histories.

E-mail: titovaliente@yahoo.com.

essential expenditures, such as education and health, since much of its fixed income will be spent on food. The rich can decrease their nonessential expenditures, an option that is unavailable for the poor. More important, the Neda could have clarified a number of issues had it focused on the poverty effects of various policies. For instance, it could have strengthened their position in favor of rice tariffication if they had presented the heavier burden on the poor imposed by high rice prices due to inflation. Also, inflation practically makes the household cash transfer under the 4Ps program (around P1,500 for those with three children or more) almost miniscule. The suggestion to convert the cash-transfer program to livelihood could have been seen as inadvisable since the funds per household would be too low to undertake an effective, equity-enhancing livelihood program. Finally, the proposal to suspend the Tax Reform for Acceleration and Inclusion program could be noted to be selfdefeating since the taxes generated from TRAIN would finance two antipoverty programs: infrastructure and social protection systems, like 4Ps. In effect, a deferment of TRAIN, which allegedly caused inflation, will only benefit the rich. In the final analysis, the Neda should focus more on measuring the consequences of all government programs and reforms on poverty. In this period of high growth, the main responsibility of economic agencies is to ensure that the poor will also benefit from this development. Leonardo A. Lanzona Jr. is professor of economics at the Ateneo de Manila University and a senior fellow of Eagle Watch, the school’s macroeconomic research and forecasting unit.

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A12 Friday, June 29, 2018

After 6 years of sabotage, Lanao power line restored By Lenie Lectura

@llectura

HE National Grid Corp. of the Philippines (NGCP) said on Thursday that it has restored and energized the Tugaya-Malabang 69-kiloVolt line, which services the Lanao del Sur Electric Cooperative (Lasureco).

The line, commissioned in 1995, has been constantly besieged by malicious and destructive acts since 2012, including bombing attempts and rampant pilferage of tower parts. NGCP’s efforts to restore the line after each incident has been thwarted by still-unknown saboteurs, who continued to wreak havoc throughout the company’s restoration activities. In February 2018, with the situation reaching critical levels, NGCP took further action to strengthen

its efforts at keeping the saboteurs at bay. NGCP stepped up its engagement with different local government units in the area, the Armed Forces of the Philippines, the Philippine National Police, Lasureco, and the Royal Sultanate League of Lanao del Sur. With their aid and support in the safety, security and swift implementation of the restoration project, NGCP was confident of its successful restoration. With over 200 of NGCP’s line personnel working nonstop, the

company was able to erect 28 new transmission poles along the line, replacing the 13 previously toppled structures. NGCP was also able to replace 25,910 meters of transmission line conductor cables, recondition towers, which were leaning or had missing parts, and conduct a massive clearing operation along the right-of-way corridor of the entire line. The grid operator said the restoration was completed on April 20, or 25 days ahead of the Department of Energy’s target date of May 15. NGCP is currently waiting for Lasureco to energize their own facilities

and connect to the said line. “We wanted to let the Lanao del Sur community know that we are always moving towards giving them sustainable power transmission services, despite the difficulties presented by the peace and order issues in the area. As transmission service provider, we will go through all lengths and exhaust all means of restoring the line,” NGCP stated. “Through the combined efforts of all our line personnel and the various stakeholders who supported us, the restoration was completed, to the great benefit of power customers in Mindanao,” said NGCP.

We wanted to let the Lanao del Sur community know that we are always moving towards giving them sustainable power transmission services, despite the difficulties presented by the peace and order issues in the area. As transmission service provider, we will go through all lengths and exhaust all means of restoring the line.”—NGCP statement

‘Is Pantawid Pasada enough to survive TRAIN?’ By Jovee Marie N. dela Cruz

@joveemarie

LAWMAKER on Thursday urged the Department of Transportation (DOTr) to examine if the Pantawid Pasada program is enough to help Filipino drivers amid increasing prices of the basic commodities and services due to Tax Reform for Acceleration and Inclusion (TRAIN) law. Rep. Sherwin N. Tugna of Cibac party-list, a member of the House Committee on Ways Means, said jeepney drivers serve as a vital component in the transportation sector, and the government should extend all the necessary aid to augment their income. “I urge the leadership of the DOTr to examine if the P5,000 subsidy is enough to sustain our drivers for six months amid the rising prices of commodities brought about by the TRAIN law,” he said. “Likewise, we in the House of Representatives will do our part and look for viable options to help alleviate the problems of our ailing transport sector,” Tugna added. Section 82 of the TRAIN law clearly states that a social welfare benefit program will be implemented where qualified franchise holders of public-utility jeepneys are entitled to fuel vouchers. The fuel subsidy program, once effec-

Mattis. . .

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“We cannot lose one inch of territory passed down by our ancestors. Meanwhile, we want nothing from others.” The meeting illustrates how disputes between the world’s two largest economies extend beyond US President Donald J. Trump’s plans to slap tariffs on Chinese goods and restrict the country’s investments. In recent months, the Defense Department has branded China a “strategic competitor” and rescinded an invitation to join annual international military exercises that begin on Thursday near Hawaii.

‘Important time’ Xi can’t afford to look weak after the ruling Communist Party repealed

Jeepneys ply Manila’s roads. A lawmaker on Thursday urged the Department of Transportation to examine if the Pantawid Pasada program is enough to help Filipino drivers, amid increasing prices of basic commodities and services. ALYSA SALEN

tively rolled out, will help drivers cope with the soaring prices of diesel fuel. “Given the consistently high fuel prices all over the country, I commend the Department of Finance, Department of Transportation and the Land Transportation Franchising and Regulatory Board for coming together for the implementation of the Pantawid

Pasada Program,” the lawmaker added. Earlier, House Committee on Ways and Means Chairman Dakila Carlo Cua of Quirino said the DOTr is also set to roll out the Pantawid Pasada Program that will provide public-utility jeepney franchise holders with discounts in their purchase of fuel next month. Pantawid Pasada is one of the

mitigating measures under the new tax-reform law to ease the impact of the oil excise tax increases on commuters and the land transport sector. Besides the Pantawid Pasada, the TRAIN also provides for additional unconditional-cash transfers to low-income earners amounting to P 2,400 for 2018 and P 3,600 for 2019 and 2020.

IFAD LOANS FOR PHL PROJECTS REACH $100M By Cai U. Ordinario

@cuo_bm

HE International Fund for Agricultural Development (Ifad) has extended over $100 million in loans to the Philippine government as of December 2017. In its annual report for 2017, Ifad also said it has invested as much as $2.2 billion in the region for 58 ongoing projects and programs. In the Philippines, data obtained from the National Economic and Development Authority (Neda) showed that Ifad funded five ongoing projects costing $110.81 million as of December 2017. “In the Philippines the evaluation found that Ifad and the government have created an effective partnership in their efforts to address rural poverty, and projects and programs have made notable achievements— for example, in gender equality and women’s empowerment,” the report read. “There is room to improve the evidence from monitoring and evaluation across the portfolio so that good practices can be scaled up,” it added. T he l a rgest proje c t of Ifad in the Philippines is the $32.16-million Fisheries, Coastal Resources and Livelihood Project with the Department of Agriculture (DA). The project seeks to encourage fishing communities to adopt sustainable management of fishery and coastal resources to increase overall stocks. Its components include coastal resource management; livelihood development; and project management and coordination. “The second component aims for fishing households in the target coastal communities to be constantly engaged in diversified sources of income,” according to documents from the Neda. Two other projects worth over $20 million each are being implemented by the Department of Agrarian Reform (DAR) and the DA. The DAR is implementing the $26.85-million Convergence on Value Chain Enhancement for Rural Growth and Empowerment (Project ConVERGE), while the DA is implementing with Ifad the $22.78-million

direction, and to share ideas with your leadership, your military leadership, as we look at the way ahead.”

Military gains Since Xi hosted Mattis’s predecessor, Chuck Hagel, in 2014, China has launched a second aircraft carrier and outlined plans to build a “world class” military by 2050. The Trump administration, meanwhile, has replaced Barack Obama’s “pivot to Asia” with an “IndoPacific” policy that looks to draw India into the regional security framework as a counterweight to China. In recent weeks, prominent Chinese academics have begun to question whether the leadership underestimated the depth of anti-China sentiment in Washington and risked a premature showdown with the world’s sole superpower. Mattis told a gathering of Asian

defense chiefs earlier this month that Beijing’s deployments of military aircraft and missile batteries in the South China Sea were causing the US to reconsider its “cooperative stance.” He said China risked “larger consequences” in the future. Still, Trump needs Xi’s help to keep North Korea engaged with disarmament talks. Xi hosted Kim Jong Un in Beijing last week—the North Korean leader’s third China trip since March —in a demonstration of China’s enduring sway as the country’s top trading partner and wartime ally. Mattis was expected to leave for Seoul later Thursday, where he would likely encounter questions about Trump’s decision to halt joint military drills with South Korea. He’ll then head to Japan, the United States’s closest ally in the region, before heading back to Washington. Bloomberg News

$32.16M The cost of the largest project of Ifad in the Philippines, the Fisheries, Coastal Resources and Livelihood Project, with the Department of Agriculture

Second Cordillera Highland Agricultural Resource Management Project (CHARMPII). Project ConVERGE aims to enable the agrarian reform beneficiaries and other small farmers in 10 provinces of Regions 9, 10 and Caraga to become highly productive and competitive entrepreneurs and contribute to the achievement of broad-based rural economic growth. The project involves participatory value-chain analysis and planning to link smallholder farmers to existing value-chain systems; integrated smallholders agricultural and rural enterprise development; a nd projec t m a n agement , monitoring and evaluation, and knowledge management. CHARMPII involves social mobilization, participatory investment planning, and land titling and community watershed conservation, forest management and agro-forestry. The project also includes agriculture, agribusiness development and income-generating activities; rural infrastructure development; and project management and coordination. “Ifad invests 100 percent of its portfolio in rural areas of developing countries, where 80 percent of the world’s poorest people live and work. This has been our mandate for 40 years, and we must never stop asking how we can deliver more, and deliver better, for the people we serve,” Ifad President Gilbert F. Houngbo said in the report. Based on the report, Ifad has eight new programs and projects in Bangladesh, India, Indonesia, Nepal, Pakistan, Papua New Guinea, Sri Lanka and Tonga. It has also extended additional financing for ongoing projects in Afghanistan, Cambodia, India, Myanmar, Pakistan and Sri Lanka.

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presidential term limits in March, and he’s pledged to go blow for blow on trade. He has warned against efforts to widen divisions with Taiwan and in April presided over China’s largest-ever naval review in a display of its growing military reach. The Chinese president’s comments were printed on the influential front page of the party’s flagship People’s Daily newspaper. Videos broadcast on Chinese state media showed Mattis studiously taking notes as Xi spoke. “This is an important time in the history of China and the United States as we work our way forward,” Mattis said as he sat with Xi in front of a bank of cameras and photographers prior to their private meeting, according to the Associated Press. “I’m here to keep our relationship on a great trajectory, going in the right

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Cottages, Solar-Powered Smart Greenhouse and the Solar-Powered Irrigation System will soon start construction with funds coming from both the private sector and government,” he said in a post in his official Facebook page on June 28. “Our target is to operate these facilities in time for the reopening of Boracay Island on October 26 this year,” he added. The agriculture chief also discovered that local fishermen are left at the mercy of resort owners who determine whether they will be allowed to unload their catch on resort beachfronts. “Upon hearing the complaint, I assured the fishermen that their complaint will be brought to the attention of President Rody Duterte through DENR [Department of En-

vironment and Natural Resources] Secretary Roy Cimatu,” Piñol said in his Facebook page published on June 27. “I will ask President Duterte to direct DENR to allocate an area where the Bureau of Fisheries and Aquatic Resources will build a fish landing complete with an ice flakesmaking equipment,” he added. Piñol said the DENR, with the endorsement of local government units, could award the stewardship of the beachfronts under a Foreshore Lease Agreement. Beachfronts in Boracay are often regarded as part of resort owners’ private property despite a provision in law stating they “cannot be owned by any individual and following the 25-meter easement from the shore, no structures could be built,” according to Piñol. Jasper Emmanuel Y. Arcalas and Jenn Kiana Louise N. Cardeno