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‘GDP growth now benefiting the poor’ D

By Cai U. Ordinario @cuo_bm & Bianca Cuaresma @BcuaresmaBM

espite the increase in commodity prices, the National Economic and Development Authority (Neda) and economists still believe the country’s high GDP growth is already trickling down to the poor.

Govt keen on scrapping rice QR this year

T

o prevent inflation from accelerating, the national government is resolved to convert the country’s quantitative restriction (QR) on rice into tariffs this year, according to the National Economic and Development Authority (Neda).

Socioeconomic Planning Secretary Ernesto M. Pernia said the conversion of the QR, which can only be done through the amendment of a law, will be prioritized over the reform of the National Food Authority (NFA).

Under Republic Act (RA) 8178, or the Agricultural Tariffication Act, only rice was not assigned a tariff because the World Trade Organization (WTO) had allowed the country to enjoy the QR. “You mean tariffication [of rice] to replace the QR? Yes, [we are keen on amending the law this year],”Pernia told BusinessMirror via Sms. Pernia, in a briefing on Thursday, said the move to set a rice tariff will reduce the retail price of rice by as much as P4 to P7 per kilogram. As such, he said this will increase the purchasing power of low-income households.

He added this will also be significant for inflation rate, because rice prices account for 10 percent of the country’s inflation rate.

The Neda chief said this is the See “Govt,” A2

The Neda and economists interviewed by the BusinessMirror said they do not see the country’s poverty incidence increasing this year and that the government’s poverty target of 14 percent by 2022 remains within reach.

The Philippine Statistics Authority (PSA) will conduct the Family Income and Expenditure Survey this year. The first round of the survey will be done in July, and the second will be done in January 2019.

“We don’t see an increase [in poverty rates] because there was

6.8%

The estimated GDP growth of the Philippines in the first quarter, according to the PSA an increase in incomes, and then there was also a top-up of the CCTs [conditional-cash transfers] beginning last year so that one would Continued on A2

Groups welcome Puyat’s appointment as DOT chief

By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

V

ARIOUS tourism industry associations on Thursday warmly welcomed the appointment of Bernadette Fatima Romulo-Puyat as secretary of the Department of Tourism (DOT).

Many of the heads of the tourism groups told the BusinessMirror, that while they didn’t know her personally, they were looking forward to working with her, and pointed to her track record as undersecretary of the Department of Agriculture (DA).

Cesar Cruz, president of the Philippine Tour Operators Association (Philtoa), said: “Her experience as a civil servant and exposure in marketing and pro-

PESO exchange rates n US 52.0080

CRUZ: “Her experience as a civil servant and exposure in marketing and promotions provide a sigh of welcome relief to the industry stakeholders who have been subjected to extraordinary challenges.”

motions provide a sigh of welcome relief to the industry stakeholders who have been subjected to extraordinary challenges, from corruption scandals to the lack of policy direction, promotion and marketing program.”

He added that the Philtoa “looks forward to the return of high morale in the industry and move on to more substantial undertakings for the success of the Philippine tourism industry.”

Dr. Lisa Grace S. Bersales, national statistician, consults with Ernesto M. Pernia, socioeconomic planning secretary, on key statistical data at the news conference announcing the first-quarter performance of the Philippine economy. NONOY LACZA

NATL I.D. SYSTEM CRUCIAL FOR FINTECH GROWTH

By Lorenz S. Marasigan

A

@lorenzmarasigan

DVANCING financial technology (fintech) in the Philippines will be much easier with the passage of a national identification (ID) system into law, a chief executive of an industry player said, as this could help digital money issuers to properly identify users and make the process for on boarding new customers easier.

Globe Fintech Innovations Inc. (My nt) C EO A nt hony Thomas said one of the impediments the industry faces is the proliferation of fake identities.

Adopting a national ID would effectively remove this barrier and take away a risk money issuers abhor.

“What could help us further

is the national identification, which can be a game changer because today, I really don’t know the real identity of my customer.

I go by documents, but it’s onerous because I don’t go by a unique number, and it’s very easy to create fake IDs,” he said during the BusinessMirror Coffee Club forum on Thursday.

He explained that having a national identity available for money issuers, such as Mynt—the operator of digital wallet GCash—would help mitigate the risks, as the system would properly and officially identify customers.

To sign up for a mobile wallet account at present, customers need only to submit a digital copy of an official government ID, such as a picture of passport, a social security card or a driver’s

license, among others.

This is part of the knowyou r- c ustomer (K YC) pro cess that fintech players observe, which Thomas believes could prove more efficient with the adoption of a national identification law.

“The moment I have a unique ID system — that opens up a lot,” he said.

Creating a national ID card for Filipinos has been on the government’s drawing board for almost a decade now. Today, the plan has passed muster at the House of Representatives and the Senate.

It was also seen approved sometime this month at the bicameral conference.

The Philippine Statistics Authority (PSA) has been budgeted See “Natl ID,” A2

Continued on A2

n japan 0.4739 n UK 70.4656 n HK 6.6253 n CHINA 8.1660 n singapore 38.6418 n australia 38.8084 n EU 61.6347 n SAUDI arabia 13.8680

Source: BSP (10 May 2018 )

A2 Friday, May 11, 2018

BMReports BusinessMirror

www.businessmirror.com.ph

‘GDP growth now benefiting the poor’ Continued from A1

have taken care of the [poor’s] purchasing power,” Neda Undersecretary Rosemarie G. Edillon told the BusinessMirror.

Edillon added that apart from the higher CCTs given to the poorest families, some of the unconditional-cash transfer (UCT) for Filipinos affected by the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law, has already been distributed.

She said that around 4 million Filipinos, all of whom are CCT recipients, have each received the UCT worth P200. Another 6 million Filipinos will receive their UCTs soon.

The aim of the UCT is to augment the incomes of Filipinos belonging to the bottom 50 percent of the population. The computation of the transfer, Edillon said, was done using the impact of the TR AIN on incomes of the bottom 50 percent.

“With that in place, we’ll be able to make up for higher prices,” Edillon said. “Hopefully they have been positively affected by economic growth in which case you have mitigated the impact [on poverty].”

Economists, including Ateneo Center for Economic Research and Development (Acerd) Director Alvin P. Ang and Bank of the Philippine Islands Lead Economist Emilio S. Neri Jr., believe the increase in commodity prices will also not exacerbate poverty.

Ang said that while inflation is expected to peak between June and July this year, he agreed with Edillon that incomes did increase because of the transfers.

However, Ang noted that the true test of whether there will be poverty reduction in 2018 will be seen in the April round of the Labor Force Survey (LFS) which covers the entire first quarter. This data will be released in July.

Ang also said the recent spike

Govt. . .

Continued from A1

reason economic managers believe the amendment of RA 8178 should be declared by the President as urgent.

“We told the President yesterday that we should really make or declare the tariffication act as an urgent so it can be passed when they [Congress] come back, as early as they come back because that’s really going to have an immediate impac t,” Pernia said.

“Maybe there will be some lag but within the year it could have an effect on easing inflation. Remember that the price of rice contribute to inflation, price of rice inflation contributes close to 10 percent of total

in inflation was largely due to the government’s failure to “coordinate and communicate,” particularly on the rice supply issue. “It’s not the TRAIN but how the bureaucracy communicated the TRAIN and how they made sure there’s ample [rice] supply,” Ang said.

Neri said inflation will likely increase to around 5 percent by the third quarter of the year but the conversion of the quantitative restriction (QR) on rice into tariffs will help ease prices.

He added that the government’s efforts to increase and fast-track spending for infrastructure will help the country cut poverty incidence down to around 19 percent to 20 percent, from the 2015 estimate of 21.6 percent.

“The decline of the poverty rate from 25 percent to 20 percent means there has been poverty alleviation already from 2010 to 2016. However, it needs to decline faster and the infra push can accelerate it. Hopefully, the growth momentum will be strong enough to overcome headwinds, such as the surge in global oil prices and rising interest rates,” Neri said.

The government’s programs coupled with a weak peso will allow the Philippines to meet its poverty incidence target, according to University of Asia and the Pacific Associate Professor Victor Abola.

Abola said, however, that the 6.8-percent GDP growth recorded in the first quarter was “disappointing” because he had expected the expansion to reach 7 percent.

He agreed with the Neda’s view that inflation was the main culprit of the lower-than-expected GDP growth. Abola hikes in the prices of food, fuel and electrify rates are to blame for the spike in inflation.

“There was delay in distributing subsidies to the poorest 40 percent of households. Also, employers may have delayed the implementation of lower compensation

inflation so its quite a major factor,” he added.

Once a rice tariff is set, the Neda believes the government can move on to reforming the NFA. Under the proposed bill, Neda Undersecretary for Policy and Planning Rosemarie G. Edillon said the priority is to remove the “monopoly of the NFA over rice importation.”

This, Pernia said, is consistent with the President’s wish to liberalize rice importation. This will also lead to lower prices because of increased competition in the rice market.

“This reform is necessary for NFA to focus on its function of maintaining a national buffer stock for food security, and to refrain from rice trading to avoid distorting the market,” he said.

Cai U. Ordinario

tax rates for individuals as BIR was late in issuing the IRR [implementing rules and regulation],” Abola said.

However, local experts admitted that the high inflation and low UCT extended to those who will be adversely affected by the TRAIN, will pose a greater challenge to the government’s effort to curb poverty.

University of the Philippines School of Statistics Dean Dennis S. Mapa estimated that the poorest 30 percent of the population bore the brunt of the increase in prices.

Mapa estimated that the bottom 30 percent may have seen inflation reach 4.5 percent in the first quarter alone. The highest inflation they felt was in March at 5.1 percent.

April inflation was projected to be higher at 5.3 percent.

The top 5 commodities that contributed the most to the increase in prices are fish; cereals and cereal preparation, which includes rice; fruits and vegetables; tobacco; and fuel, light and water.

W it h t he s e a s s u mpt ion s, Mapa said the UCTs extended to the poorest Filipinos of P200 a month was “insufficient.”

For a family of five, Mapa said the cash transfer they need to cope with higher prices caused by the implementation of TRAIN is around P284 to P473 a month, or P3,408 to P5,680 per year.

He also estimated that a family of six will need P341 to P568 per month, or P4,089 to P6,816 per year, while a family of seven will need P398 to P663 a month, or P4,771 to P7,952 a year.

“Estimate [of the impact on poverty] will be tricky. But high inflation among the poor families will create challenge in the poverty reduction efforts,” Mapa said.

Foundation for Economic Freedom President Calixto V. Chikiamco told the BusinessMirror that in order to tame inflation, the

government must convert its rice QR into tariffs.

But recent developments, Chikiamco said, particularly higher oil prices, would be difficult to predict. This will complicate the plight of the poor since any increase in prices will have a significant impact on them.

“Inflation should moderate but the wild card is higher oil prices. The US pullout from the Iran deal could limit oil supply and cause prices to spike further,” Chikiamco said.

GDP data

S o cioeconomic Pl a n n i n g Secretary Ernesto M. Pernia said inflation was the “spoiler” of the country’s economic performance in the first quarter of the year.

He said if it weren’t for high inflation, which averaged 3.83 percent using the 2012 rebased data, GDP growth during the period would have breached 7 percent.

“Just a small digression in case you are interested in a small secret—if not for inflation, real GDP growth would have been well within our growth rate targets of 7 percent to 8 percent,” Pernia said.

“So, inflation is the spoiler, that is why we really need to focus on inflation especially because it is the No. 1 concern expressed by Filipinos in surveys,” he added.

Despite this, Pernia said the Philippines remains as one of the “best performing economies” in the region, next only to Vietnam’s and China’s 7.4 percent GDP growth and higher than Indonesia’s 5.1 percent.

He added that the country’s growth target remains within reach.

Data from the Philippine Statistics Authority (PSA) showed that the 6.8-percent GDP expansion recorded in the January-to-March period was faster than the previous year’s 6.5 percent.

The PSA said manufacturing, Other Services and Trade, were the main drives of growth.

Among the major economic sectors, industry recorded the fastest growth at 7.9 percent. This was followed by services, with a 7-percent expansion. Agriculture grew at a slower pace of 1.5 percent.

Net primary income rose to 4.3 percent during the quarter. Gross National Income (GNI) posted a growth of 6.4 percent, faster than the previous year’s 6.3 percent.

Malacañang on Thursday welcomed the “good news” that GDP grew faster in the first quarter.

“We are optimistic that our economic momentum would continue to be sustained with higher tax-revenue collection and bigger public spending in infrastructure,” Presidential Spokesman Harry L. Roque Jr. said.

Budget Secretary Benjamin E. Diokno also said in a statement that higher government spending allowed the country’s economy to perform well during the period.

“Moving forward, expect government spending to continue to boost our growth prospects given the staggering P3.767-trillion national budget for 2018,” Diokno said. “With the first-quarter numbers, I am confident that the 7-percent to 8-percent growth target is doable.”

Higher interest rates

The Monetary Board decided to increase the interest rate on its overnight reverse repurchase (RRP) facility, from the current 3 percent to 3.25 percent in its May 10 meeting. Adjustments were also made in the overnight lending and deposit facilities.

The Bangko Sentral ng Pilipinas (BSP) last made such a policy move to curb inflationary pressures in 2014, when inflation threatened to breach their target for the year. As recent inflation figures trend above the BSP’s annual forecast of 2 percent to 4 percent, analysts said it is already time for the BSP to “pull the

trigger” once more.

The BSP also hiked its inflation forecast for 2019 to 3.4 percent, from 3 percent.

“Given these considerations, the Monetary Board believes that a timely increase in the BSP’s policy interest rate will help arrest potential second-round effects by tempering the buildup in inflation expectations,” BSP Governor Nestor A. Espenilla Jr. said following the meeting.

“The Monetary Board observed that strong domestic demand allows some scope for a measured adjustment in the policy rate without adversely affecting the country’s economic growth momentum,” Espenilla added.

He said the BSP would continue to “closely monitor” domestic developments, as well as the evolving global economic environment, including the potential impact of the ongoing normalization of monetary policy in some advanced economies.

Following the meeting, the International Monetary Fund (IMF) told the BusinessMirror that they were “pleased” with the BSP’s decision on Thursday.

Yang said he “welcomes the interest rate hike” and said the move was “appropriate.”

In terms of market response, ING Bank Manila economist Joey Cuyegkeng said local financial markets are likely to remain volatile in the coming days.

“The Central Bank did not disappoint and raised policy rates by 25 basis points and revised inflation forecast, but we’re unlikely to see another one before the fourth quarter. Expect the peso to remain volatile,” he said. “The BSP’s move should calm investors in the equity and bond side, signaling to them that inflation will likely come down now that the Central Bank is in a tightening bias,” he added.

With Bernadette D. Nicolas

Groups welcome Puyat’s appointment as DOT chief Continued from A1

Jose Clemente III, president of the Tourism Congress of the Philippines (TCP) lauded RomuloPuyat’s pronouncement that she would keep the “It’s More Fun in the Philippines” brand campaign.

“That’s great news,” he said, adding, “we’re off to a great start.”

(See, “New DOT chief vows to be tough on corruption; will keep ‘It’s More Fun in the PHL’ brand campaign,” in the BusinessMirror, May 10, 2018.)

He said the industry also expressed optimism about moving forward, “getting back to the business of tourism without

distractions. We are anticipating more dialogues and exchanges of ideas with the Department of Tourism (DOT) and the new leadership. We wish to be a true partner of the DOT.” The TCP, as envisioned by the Tourism Act of 2009, is composed of representatives of all accredited tourism enterprises and former government officials in the tourism industry.

Even former Tourism Secretary Ramon R. Jimenez Jr. was pleased with the appointment of RomuloPuyat as DOT chief. “Berna is a hard worker and an experienced bureaucrat. She should do well. I hope she moves quickly to heal the industry.” The new DOT secretary had expressed keen admiration for Jimenez for launching the It’s More Fun in the Philippines, brand campaign and for being able to “think out of the box.

For her part, Christine Anne U. Ibarreta, president of the Hotel Sales and Marketing International Inc. (HSMA) hoped for a good partnership between the tourism industry professionals and the new Tourism secretary-

Natl ID. . .

Continued from A1

with P2 billion to roll out the national ID system with the use of biometrics.

Having a national ID will allow at least 105 million Filipinos to benefit from having a valid proof of identity. Such is designed for universal coverage, data integrity and security and optimum utility.

The Bangko Sentral ng Pilipinas has openly supported the passage of the national identification bill as this could help further drive the digital economy.

designate, based on the latter’s seeming understanding of the plight of women in agriculture and workers in general. “In the same light, we wish she would open her office for HSMA and other industry organizations to hear our requests and we will be more than willing to help and support her in her bid to make the Philippines a fun destination again.”

Ibarreta added, “Personally I admire the way she brought up her children during the challenging days of her life. She’s a person with a heart to serve. Her lineage speaks of service and love for country.”

Romulo-Puyat comes from a family of civil servants, starting with her granduncle, the late statesman Carlos P. Romulo, and her father, former Senator and Foreign Secretary Alberto Romulo. Her brother, Roman, is a former congressman of Pasig City.

She told reporters on Wednesday that it was important for government officials to stick to the rules and stay away from questionable deals. “At the end of the day, your only capital is your family name.”

Romulo-Puyat stressed she would grant no favors to family and kin, and narrated that when her father held the foreign affairs department portfolio, she had to line up like everyone else “for three hours” to get her passport renewed.

She said she would thoroughly go over all projects and contracts signed under the administration of Wanda Corazon T. Teo. “You really have to look at it. So I really have to check everything and make sure there’s proper bidding, there’s transparency. I have to check because, I can’t say that it wasn’t my fault [in case the contract is flagged], that was the former [administration]…. I’m definitely going to look at all the contracts.”

Teo resigned on May 7 after a Commission on Audit report tagged a P60-million payment by the People’s Television Network Inc. (PTV-4) to Bitag Unlimited Media Inc., owned by her brother Ben Tulfo, for not being covered by the required documents. The funds, it was reported, came from the media placement contract of the DOT with PTV-4.

“ The current governor is a strong advocate of inclusion and digital payments. So the policy framework, I think, we have in the Philippines, is in the right direction,” Thomas said.

According to the Mynt executive, there is a “very large” opportunity in the financial technology space, given that seven out of 10 Filipinos are still unbanked and uncarded.

Financial technology, he said, bridges the gap that separates those who have access to the formal financial instruments—such as credit, savings, and insurance—and to those who do not have.

“It is relatively small in terms of impact in Philippines, but is a growing ecosystem. If you think about services today, e-payments only comprise 1 percent of the total payments happening now—and that’s very small,” Thomas said.

“So there is a very large opportunity in that aspect.”

He added that digital payments could proliferate in the coming years, as mobile in the Philippines is very ubiquitous, given that there are 120 million active SIM cards in the country today.

“We are very small today, but the beauty of a digital platform is it scales very quickly,” Thomas said.

The Nation BusinessMirror

www.businessmirror.com.ph

Editor: Vittorio V. Vitug • Friday, May 11, 2018 A3

Magistrates decide on CJ Sereno’s fate

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By Joel R. San Juan

@jrsanjuan1573

ILL Chief Justice Maria Lourdes A. Sereno be able to sit on her throne again as the country’s Judiciary’s top magistrate, or will she be kicked out from the Supreme Court (SC) where she seemed to be unwelcome by her own colleagues since she assumed her post four years ago?

Sereno’s fate is expected to be known on Friday during the SC’s special en banc session, where her fellow magistrates are scheduledtodeliberateanddecideonthequo warranto petition filed by Solicitor General Jose C. Calida, seeking the nullification of her appointment as chief magistrate for her failure to comply with the requirements set by the Judicial and Bar Council (JBC).

Calida said Sereno allegedly failed to file her Statements of Assets, Liabilities and Net worth (SALN) for several years from 1986 to 2006 when she was a professor at the University of the Philippines (UP) College of Law. It was found out that aside from her SALNs for the years 2006, 2009, 2010 and 2011, which she submitted in her applications for Associate Justice and Chief Justice, Sereno only filed SALNs for the years 1998, 2002 and 2006 during her tenure as law professor at the UP College of Law from 1986 to 2006.

If found guilty, Sereno will be the first Chief Justice to be removed from the post through a quo warranto proceedings.

The magistrates are scheduled start their deliberations at 10 a.m. Sereno, who terminated her indefinite leave of absence and reported back to work on Wednesday, said she would preside over the special en banc session but would inhibit when her colleagues start tackling the quo warranto petition.

Sereno’s camp said the Chief Justice is ready to face whatever is the outcome of the Court’s deliberations on the quo warranto petition.

Meanwhile, 130 law deans and professors from various law schools in the country have issued a last-minute appeal for the Court to reject the quo warranto petition and instead pushed for the trial of Sereno before an impeachment court.

“We, members of the law faculties, express our deep concern [over] the move to unseat the Chief Justice of the Supreme Court by means other than by impeachment,” the law deans and profes-

sors said in their manifesto, entitled “A Call for Adherence to Constitutional Process.”

“We are not questioning the motivation, integrity and patriotism of anyone involved in this process, but we must remind them that the integrity of the process is as important as its result,” they added.

The signatories include former Solicitor General Florin T. Hilbay, Pamantasan ng Lungsod ng Maynila (PLM) Graduate School of Law Dean and retired Court of Appeals Justice Hector Hofileña, De La Salle College of Law Dean Jose Manuel Diokno, Lyceum College of Law Dean Maria Soledad Derequito-Mawis, Adamson College of Law Dean Anna Maria Abad, Far Eastern University Institute of Law Dean Melencio Sta. Maria and Ateneo de Davao University College of Law Dean Manuel Quibod.

Former UP College of Law Dean Pacifico Agabin, former Ateneo School of Government Dean Tony Laviña, PLM College of Law Dean Marisol Anenias, University of San Agustin College of Law Dean Jose Mari Tirol, and law deans and professors from Metro Manila and the cities of Baguio, Butuan, Cotabato and Davao also signed the manifesto.

The signatories insisted that the Constitution provides only one means to remove a sitting Chief Justice and that is by impeachment by the House of Representatives and conviction after trial in the Senate.

“Any other means would be unconstitutional,” they said.

Thus, the signatories called for the start of Sereno’s impeachment trial in the Senate, where she finally gets the chance to defend herself from the allegations hurled against her.

“Let the impeachment of the Chief Justice take its course as the Constitution dictates. Let the trial in the Senate, sitting as an impeachment court, begin. Allow the Chief Justice to defend herself in the impeachment trial,” they said.

JBC lists nominees for SC slot

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UPREME Court (SC) Administrator Jose Midas Marquez and several associate justices of the Court of Appeals (CA) are among those vying for the post in the SC that will soon be vacated by retiring Associate Justice Presbitero Velasco Jr. Aside from Marquez, among those who either applied or nominated for the post were CA Associate Justices Jose Reyes, Rosmari Declaro Carandang, Ramon Bato, Ramon Hernando, Ramon Garcia, Oscar Badelles, Manuel Barrios, Apoli-

nario Bruselas and Amy Lazaro-Javier.

Other candidates include former Ateneo College of Law Dean Cesar Villanueva and Judge Carlos Espero of the Regional Trial Court in Davao City .

Aside from Velasco, who will be retiring on August 8, Justice Teresita Leonardo-de Castro will also vacate her post when she reaches the retirement age in October of this year.

The Judicial and Bar Council (JBC) closed its nomination for Velasco’s post on May 2. Joel R. San Juan

11 CamSur govt employees file police complaint against lawmaker

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lmost a dozen members of Camarines Sur’s Sagip Kalikasan Task Force (SKTF) have trooped to the Pili Municipal Police Station in the province to report alleged acts of physical and verbal abuse that they claimed to have suffered last month in the hands of Rep. Rolando G. Andaya Jr. of the First District of Camarines Sur, who allegedly wanted them to abandon the clearing operations for the Naga airport modernization project that is part of the infrastructure development program of President Duterte.

Eleven SKTF members complained to the police about the violent acts allegedly committed against them in April by a knife-wielding Andaya, who was reportedly accompanied by his bodyguards and Pili Mayor Tomas Bongalonta Jr. at the start of the clearing operations for this airport-expansion project in Barangay San Agustin in the town of Pili.

Based on the official police blotter entries, among those who had complained to the police were Lito Sumpay, Ryan Herrera, Saetiel Pielago and Angelo Refran, all of whom reported that Andaya had “terrorized” them with a knife and threatened them with harm if they did not leave Camarines Sur right away.

One of the complainants, Anna Marie Macarubbo, who reported suffering physical injuries after one of Andaya’s bodyguards shoved her almost to the ground, alleged she saw and heard Andaya shouting and hurling invectives at her fellow SKTF volunteers. When Andaya saw her, Macarubbo said, the congressman pulled her ID that was placed around her neck, almost choking her.

The other SKTF members who caught Andaya’s eye were either punched, shoved, cursed at and threatened with harm, and their cell phones and other personal belongings seized by the congressman and his bodyguards.

One of them, Sumpay, said Andaya even allegedly held him by the jaw and told him: “Ayaw kita makita sa CamSur! ’Pag nakita kita may gagawin ako sayong masama! (I don’t want to see you here in Camarines Sur. Leave before anything untoward happens to you).

According to several of the SKTF members who complained to the police, they were puzzled as to why Andaya would interfere and vehemently oppose the airport development project of the Department of Transportation (DOTr) under the Duterte administration when the project is in Camarines Sur’s third district, which is beyond the congressman’s jurisdiction because he represents the first district.

Andaya’s violent tirade in Barangay San Agustin was followed by his continued acts of harassment at the Pili Municipal Station, where he proceeded after learning that his victims went to the police station to report Andaya’s assault and seek police protection.

This time, Andaya’s violent acts at the police precinct were caught on video, which has since then gone viral on social media.

In the video clip, an enraged Andaya is shown hurling insults at another person, who, based on subsequent media reports, turned out to be fellow lawmaker Rep. Luis Raymund F. Villafuerte Jr. of the Second District of Camarines Sur and challenging him to a fight outside the police precinct. Villafuerte was in the police station at that time to comfort and look into the welfare of the victims, many of whom were Villafuerte’s employees when he was still Camarines Sur governor.

Later, Andaya is seen in the same video holding in a chokehold one person who had tried to pacify him and convince him to peacefully leave the precinct. While strangling the person, Andaya continued to curse

and threaten him.

The provincial government of Camarines Sur has been overseeing the implementation of the Naga Airport Development Project on the strength of the province’s memorandum of agreement (MOA) with the DOTr in November 2016.

Under the MOA, the DOTr had committed to set aside P402 million for this airport project­— to be taken from the DOTr’s budget in the General Appropriations Act of 2015­— for the acquisition of lots for the affected residents and for their resettlement, as well.

The provincial government, in turn, was tasked under the MOA to identify the affected residents and to supervise the purchase of their lots, based on the principle of just compensation, and their relocation elsewhere.

Moreover, the Regional Trial Court (RTC) in Pili issued on July 5, 2017, a writ of possession ordering the affected residents not to exercise their rights over their lots and to vacate these lands in favor of the DOTr project.

Even before the court’s issuance of this writ, the provincial government started three years ago negotiating with the concerned farmers and their tenants and even with informal settlers on the expropriation of the area.

In fact, a majority of the affected ones had already formally decided to turn over their lots to the provincial government while a number have agreed in principle to do so and are just awaiting the court’s decision on what the “just compensation” should be for their property.

To speed up the expropriation process and settle the issue amicably, the provincial government has opted to pay both the landowners and the tenants who have been tilling the affected lots.

DILG ‘imports’ experts in Subic federalism forum 3rd plunder rap filed vs Aquino,

By Nelson S. Badilla | Correspondent

T

HE Philippines appear to have no expert in federalism.

Thus, the Department of the Interior and Local Government (DILG) has invited at least seven international experts on federalism who will tackle the various aspects of the political system in a two-day forum on May 11 and 12.

The DILG is the government agency tasked by President Duterte to lead the national government’s resolve to convince the Filipino to agree with the Duterte administration’s agenda to change the existing presidential system into a federal

form of government.

In a news statement issued by the DILG’s Public Information Office (PIO) headed by Tess Vergara, the interior department’s Center for Federalism and Constitutional Reform being chaired by Assistant Secretary Jonathan E. Malaya will spearhead the two-day forum in Subic.

The Center for Federalism and Constitutional Reform has invited Forum of Federations President and CEO Rupak Chattopadhyay; former Secretary of the Inter State Council Secretariat, Ministry of Home Affairs Government of India (India’s peak intergovernmental agency) Ravi Dhingra; Senior Advocate and a constitutional legal

advisor to the President of Nepal Dr. Surya Dhungel; External Expert Panel on devolution of the Scottish Parliament member Dr. Sandra Leon; Curtin University Law School Professor Bertus de Villiers; University of the Western Cape’s Dullah Omar Institute Jaap de Visser (LLB, LLM, PhD); and Forum of Federations Executive Director for Asia and Australia Phillip Gonzalez.

Aside from above mentioned, hundreds of local and international participants are expected to attend the two-day affair, the DILG statement said.

The forum will carry the theme “Multilevel Systems of Government­—Structural Features and Intergovernmental Relations.”

21 others over Dengvaxia mess

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ormer President Benigno S. Aquino III and 21 others were again charged with plunder before the Office of the Ombudsman on Thursday over the P3-billion immunization program for the dengue vaccine Dengvaxia.

Lawyer Ferdinand Topacio and Diego Magpantay, president of the Citizens Crime Watch (CCW), filed the 48-page complaint before the Office of the Ombudsman against Aquino and the 21 other respondents for plunder, a nonbailable offense.

The respondents were also charged with malversation of public funds and violation of Section 3(e) of Republic Act 3019, or the “Anti-Graft and Corrupt Practices Act.”

The other respondents named in the complaint are former Budget Secretary Florencio B. Abad, former Executive Secretary Paquito N. Ochoa Jr., Philippine Children’s Medical Center Director Dr. Julius Lecciones, former Health Secretary Janette L. Garin and 17 other former and current health officials.

In its complaint, the CCW alleged that Aquino and his coaccused “haphazardly planned and procured [Dengvaxia] in gross violation of regulatory processes of the [Food and Drug Administration], the [Formulary Executive Council] and the government procurement laws” at the expense of the health of more than 830,000 Filipinos who were administered with the vaccine. PNA

Economy

A4 Friday, May 11, 2018 • Editors: Vittorio V. Vitug and Max V. de Leon

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Makabayan bloc seeks TRAIN law repeal

By Jovee Marie N. dela Cruz

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@joveemarie

iting what it described as its “detrimental” effects to the people, the Makabayan bloc in the House of Representatives on Thursday filed a bill that calls for the repeal of the Duterte administration’s Tax Reform for Acceleration and Inclusion (TRAIN) law.

In House Bill 7653, the Makabayan bloc said that in the first few months of the implementation of the new tax-reform law, prices of petroleum products, basic goods and services rose.

“Rice, which is supposed to be VAT [value-added tax] exempt, became more expensive by P1 to P2 per kilo.

There was a P10 increase per kilo for beef, meat and pork lean meat and P2 to P20 per kilo increase for dressed chicken,” the bloc said.

“The Department of Economic Research of the Bangko Sentral ng Pilipinas said that on April 2018 inflation may reach 4.7 percent, while the Philippine Statistics Authority [PSA] reported an inflation rate of 4.5 percent in March, higher from the revised 3.8 percent in February.

Earlier, according to news reports, inflation hit successive three-year highs of 4 percent and 4.5 percent in January and February this year, coinciding with the initial imple-

mentation of the TRAIN law,” the bloc added.

The lawmakers, citing the PSA, said the tax-reform law has both direct and indirect effects on the cost of goods, with price hikes “particularly felt by the poor during the start of the year.”

“The impact of TRAIN among the poor Filipinos could never be denied.

While the TRAIN law provides higher income tax exemption for those earning below P250,000 annually, it actually levies higher tax burden to the poor majority with the removal of some VAT exemptions and introduction of new excise taxes on petroleum products and sugar-sweetened beverages,” the bloc said.

Meanwhile, in the same bill, the bloc has introduced new provisions, which seek to:

Restore the old National Internal Revenue Code (NIRC) levels of excise tax on petroleum products and oil, specifically zero tax for liquefied petroleum gas (LPG), diesel, kerosene and bunker oil (Section 5);

Repeal the whole section on excise taxes on sugar-sweetened

beverages (SSBs) (Section 7);

Repeal the whole section on distribution of incremental income from TRAIN (70 percent build, build, build and 30 percent on social measures) (Section 7);

Restore the personal exemption worth P50,000 and P25,000

low cost housing (Section 3);

Restore the 3-percent tax exemption of cooperatives, self-employed and professionals with gross receipts of P2,000,000 and below (Section 4).

Party-list Rep. Carlos Isagani T. Zarate of Bayan Muna, for his part,

We hope that this bill will be fast-tracked by Congress because the economic suffering being endured by our countrymen because of the TRAIN law is very real and should be addressed the soonest time possible.”—Zarate per dependent (Section 2);

Restore the VAT exemption of sales of electricity by generation companies, transmission by any entity, and distribution companies including electric cooperatives (Section 2);

Restore the VAT exemption of

said what is needed now is not just a mere review or suspension of the TRAIN law, but “TRAIN law needs to be repealed.”

“House Bill 7653 will repeal the anti-poor and anti-people provisions of the TRAIN law so as to lessen the burden of consumers, because they

Gatchalian gripes over govt’s cash-subsidy snafu

By Butch Fernandez

Signing of PHL, Kuwait agreement on OFW protection set on May 11

@butchfBM

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S

en. Sherwin T. Gatchalian griped on Thursday over the Duterte administration officials’ inability to “fully implement” the government’s timely cash-subsidy scheme to cushion the impact of expected price increases triggered by the implementation of the Tax Reform for Acceleration and Inclusion (TRAIN) law.

Gatchalian reprimanded government representatives for their “failure to fully implement the unconditional-cash transfer [UCT] program, which is meant to shield low-income Filipinos from price increases due to the TRAIN law.”

“This is an issue for us [senators],” he said. “We all know dispensing P200 to 10 million households will be a big challenge, but we were assured that by 2018, all beneficiaries would receive their part.”

The senator, addressing Executive officials in a statement issued on Thursday, clarified that “my point here is we make decisions based on the information and assurance you are giving us.

If you can’t keep your word, then we may have had arrived at a different decision.”

He added: “Now, you are telling us that you are to complete this by September?”

Gatchalian, who chairs the Senate Committee on Economic Affairs in joint Senate hearings on TRAIN-driven inflation and potential mitigating measures, cited the guarantee given by the Department of Finance (DOF) during the Senate deliberations on TRAIN last year when DOF assured the senator that the P24 billion cash-transfer program would be in full swing by January 1, 2018, when the TRAIN law took effect.

The senator recalled that the Department of Social Welfare and Development (DSWD) also informed senators at the hearing that the Duterte administration was only been able to distribute aid to around 4 million households, even as he noted that the new target is to complete disbursement to the remaining 6 million households by the end of September.

Gatchalian added that “as of the moment, the DSWD is looking for ways and means to cut down the payouts. However, we have physical constraints that we have to consider.”

He recalled the explanation of DSWD Assistant Secretary Noel Macalalad at the hearing “there are areas that are hard to reach, and transporting money—physical money—to the nearest LandBank branch takes a lot of logistics planning.”

Gatchalian’s committee was informed that the P24-billion allotment for UCT was broken down to three beneficiary programs: the Pantawid Pamilyang Pilipino Program (4.4 million households), the Social Pension Program (3 million households) and Listahan Program (2.6 million households).

The senator noted, however, that the P200 per household allotment is “insufficient” to cushion the poorest 30 percent of the population, as prices of diesel and gasoline products are expected to spike by 2019 due to new excise taxes imposed by TRAIN. Gatchalian indicated he was “thinking of adjusting it from P200 to about P450 to cover others.”

“If you look at the poorest 30 percent of our population, their biggest consumption, 70 percent of their expenditure, is on food.

Inflation is at its peak. This means, you have to cover the increase in food prices of the lower 30 percent of the population,” he added.

are the ones bearing the brunt of the TRAIN law. They don’t even feel the supposed 6.8-percent growth of the Philippine economy,” Zarate, a member of the political bloc, said.

“We hope that this bill will be fast-tracked by Congress because the economic suffering being endured by our countrymen because of the TRAIN law is very real and should be addressed the soonest time possible,” he added.

Besides Bayan Muna, members of the Makabayan bloc include ACT Teachers, Anakpawis, Kabataan and Gabriela party-lists.

President Duterte has signed into law Republic Act 10963, or TRAIN law on December 19, 2017, aiming to create a simple, fair and more efficient system that will make the rich contribute more to fund the government’s services and programs for the benefit of the poor.

The law is also expected to finance the “Build, Build, Build” program, which will modernize the country’s infrastructure backbone and is expected to create 1.7 million jobs by 2022.

Mother’s choice

A shoe store in downtown Santa Cruz, Manila, holds a pre-Mother’s Day sale for moms who would want to suit themselves up for the global celebration this coming Sunday. ROY DOMINGO

DFA chief meets Filipinos, Riyadh counterparts amid attacks vs Saudi

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oreign Secretary Alan Peter S. Cayetano has met with his counterpart in Riyadh, Saudi Arabia, to check on the conditions of Filipinos in the Gulf state amid tensions, following the series of attempted missile attacks against the kingdom.

“One-third kasi ng ating overseas Filipino workers, nandito sa Middle East. Naging busy lang kasi tayo last year because tayo ang host ng Asean. Dapat naman talaga, bago mag-Ramadan, I do my introduction tour and meetings with the foreign ministers [A third of our OFWs are here in the Middle East.

It’s just that we were busy last year because of the hosting of the Asean. The introduction tour and meetings with foreign ministers should be done before Ramadan],” Cayetano said in an interview in Riyadh on Thursday.

On Wednesday the Saudi Press Agency reported that the Royal Saudi Air Defense Forces intercepted a ballistic missile launched by Al-Houthi rebels, targetting Riyadh.

After arriving in the Middle East, Cayetano said he also received text messages about the attack, as he reiterated the Philippine government’s denouncement of the missile launches.

“We’ve been condemning those attacks against the Kingdom of Saudi Arabia; we’ve been condemning violent extremism, terrorism; we’ve

been condemning the use of force to settle disputes,” he added.

Meanwhile, Cayetano said he is confident of Saudi Arabia’s defense capabilities and protecting their citizens and people.

“Ang Saudi Arabia naman ay kilala sa pagiging handa, and kasama naman ang mga Pilipino sa kanilang contingency plans kung may mga attacks against sa Kingdom. [Saudi Arabia is known for being ready and they have included Filipinos in their contingency plans in case of attacks against the Kingdom.] But I am very confident of their defense capabilities and protecting their citizens and people in the Kingdom of Saudi Arabia,” he said. “But, of course, we are concerned. All prayers are welcome.”

In March Saudi forces shot down several ballistic missiles, but two Egyptians on the ground were killed by falling debris.

Saudi Arabia, which hosts thousands of Filipino workers, has repeatedly been targeted by Houthi rebels fighting a Saudi-led military coalition supporting the internationally recognized government of Yemen President Abdrabbuh Mansour Hadi.

According to latest figures from the Department of Foreign Affairs, there are 374,495 Filipinos in Riyadh; 7,850 in Najran; and 15,700 in Jizan, Saudi Arabia. PNA

Mindanao devt fund given 2-year extension

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he Mindanao Trust Fund (MTF) will continue to provide a socioeconomic boost to fragile communities in the region, following an agreement between the government and donor agencies to extend the program for two more years.

The agreement was made by the Office of the Presidential Adviser on the Peace Process, led

by Presidential Peace Adviser Jesus G. Dureza, the World Bank, the Bangsamoro Development Agency and international donor partners during

the 19th MTF Steering Committee meeting held on Wednesday in Pasig City.

Dureza noted that while most development projects wind down during their closing months, the two-year extension of the MTF means it can scale up its programs up to 2021.

He also expressed his gratitude to the donor community for “staying during challenging times and keeping faith that somehow a final destination could be reached.” PNA

he signing of the memorandum of agreement (MOA) on the protection of Filipinos in Kuwait between the Philippines and the Arab Gulf state may take place on May 11.

“Sa a-onse po ’yung araw na inaasahan natin na magkakaroon ng lagdaan ng memorandum of agreement [May 11 is the day we expect to have a signing of a memorandum of agreement],” Presidential Spokesman Harry L. Roque Jr. said in a news briefing at the Philippine Embassy in Kuwait on Wednesday night.

Roque made the announcement after the Philippine delegation met with officials from the Kuwaiti Interior Ministry and Foreign Affairs Ministry to discuss the diplomatic spat between the two countries.

He was joined by Labor Secretary Silvestre H. Bello III, former Labor Secretary Marianito Roque, Labor Attaché Rustico de la Fuente and Deputy Chief of Mission in Kuwait Mohd Noordin Lomondot.

Bello said it was agreed that the MOA shall contain a contract of employment template where the provisions “particularly stated” by President Duterte are enumerated.

These provisions include requiring workers’ passports to be deposited to the Philippine Embassy and not confiscated by employers; workers given one day-off every week; workers given seven hours sleep a day; workers provided with decent meals and sleeping quarters; and workers provided with cell phones.

Asked if there will be a total lifting of the deployment ban to Kuwait once the MOA is signed, Bello said that it will be a “partial lifting.”

“Baka [Perhaps] partial lifting lang [only] to allow the deployment ng mga [of] skilled workers and professionals. ’Yun ang ire-recommend ko kay Presidente [That’s what I’ll recommend to the President],” Bello said.

“Kailangan tingnan muna natin ang magiging immediate effect ng lalagdaan nating [MOA] [We have to check what the immediate effect of the MOA will be],” he added.

Aside from the conditions laid out by Duterte, Kuwait also agreed to create a special unit within the police that the Philippine Embassy can liaison with regarding complaints of Filipino workers which will be available 24 hours.

“Sila po ’yung tatawagan ng Philippine Embassy kung merong mga reports ng mga distressed na mga kababayan natin [The Philippine Embassy will contact them if there are reports of distressed Filipino workers],” Roque said.

A special number that Filipino workers can call for assistance (also available 24 hours) will be accessible.

Moreover, Kuwait also promised to allow all remaining undocumented Filipinos (more or less 600), except for those with pending cases, to go home at their expense.

“Nabigla kami. Napasipa ako kay Atty. Harry Roque n’ung sinabi at their expense. That is a bonus na unexpected talaga [We were surprised. I nudged Atty. Harry Roque when they said they would send undocumented Filipinos home at their expense. That is a bonus that is really unexpected],” Bello said.

Roque said at least 150 overseas Filipino workers will be joining the Philippine officials in returning to Manila on May 12.

The diplomatic spat between the Philippines and Kuwait started after the Kuwaiti government slammed the action taken by the staff of the Philippine embassy who conducted rescue operations of distressed Filipino workers in their country.

Duterte earlier imposed a total deployment ban on new workers to Kuwait after the murder of domestic worker Joanna Demafelis, along with a series of reported abuse and maltreatment of Filipino domestic workers. PNA

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Friday, May 11, 2018

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Mahathir to form new Malaysian govt after shocking win

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ahathir Mohamad demanded to form a new government by 5 p.m. local time (Thursday) after his opposition coalition dealt Prime Minister Najib Razak’s ruling coalition a stunning defeat.

Mahathir Mohamad (center) holds an endorsement letter as he speaks next to President of Justice Party Wan Azizah (left) and General Secretary of Democratic Action Party Lim Guan Eng (right) during a news conference at a hotel in Kuala Lumpur, Malaysia, on May 10. AP/Andy Wong

Any delay in his appointment would mean that Malaysia, doesn’t have the rule of law, Mahathir told reporters in Kuala Lumpur on Thursday.

Malaysia’s longest-serving premier who defected to the opposition to take on Najib’s Barisan Nasional coalition, is in position to return to power at the age of 92.

Mahathir’s four-party opposition bloc won a parliamentary majority, ending the six-decade rule of Najib’s party in a landmark shift for the Southeast Asian nation.

Najib said earlier he’ll accept whomever Malaysia’s king picks as the next prime minister.

King’s decision

It ’s unclear when Mahathir will be sworn in as prime minister, with a palace aide saying it wouldn’t take place on Thursday. Najib noted that no single party won a majority, and the king must decide who has the trust of all lawmakers.

“Barisan Nasional will respect whatever is the decision made by the king,” Najib said in his first remarks after the election, referring to Malaysia’s constitutional monarch.

“I would like to urge all Malaysians to remain in a calm manner and give trust to the king and his wisdom in making the best decision.”

Najib had faced increased public anger over a goods-and-services tax (GST) that boosted prices and a money-laundering scandal involving hundreds of millions of dollars siphoned from state investment firm 1Malaysia Development Berhad (1MDB). While Najib denied wrongdoing, Mahathir lambasted him as a “thief” on the campaign trail.

“This has been a Malaysian tsunami, across the board and the country,” said Bridget Welsh, a political scientist at John Cabot University in Rome who specializes in Southeast Asia. “Mahathir was a game changer. But it also took Najib. They wanted Najib gone.”

The result represents a monumental shift in a nation long defined by racial politics that hasn’t seen a transfer of power since independence in 1957.

It’s also a win for democracy in Southeast Asia, where generals and authoritarian leaders often

lock up opponents and stifle free speech.

‘Restore rule of law’

“We are not seeking revenge,” Mahathir said. “What we want to do is to restore the rule of law.”

Financial markets are closed on Thursday and Friday after the government declared public holidays. Malaysia’s police advised political parties to not hold rallies that could jeopardize public order.

Ma laysia’s stock market, which traded near a record high on the eve of the election, will become more volatile after Mahathir’s victory, Morgan Stanley analyst Aarti Shah wrote in a note. As results signaled a win for Mahathir, iShares MSCI Malaysia ETF based on the nation’s stocks dropped as much as 2.6 percent to the lowest since February.

“People are loudly and clearly frustrated with the government,” CIMB Group Chairman Nazir Razak, Najib’s brother, said in a Bloomberg TV interview. “The will of the people win today and I’m fully expecting a smooth transition in political leadership.”

Bread-and-butter issues

Malaysia is a federation of states based on historical kingdoms, with a monarch called the Yang di-Pertuan Agong who rotates from among nine Malay rulers every five years.

Mahathir had eroded the power of the royals during his time in office, removing their legal immunity and laws barring criticism of them. Still, there was no indication he wouldn’t be sworn in as prime minister.

On the campaign trail, Najib’s opponents mainly focused on bread-and-butter issues. The GST helped inflation accelerate last year at nearly the fastest pace in a decade.

Ma hat hir’s coa l it ion has pledged to scrap the GST within his first 100 days in office, and reintroduce fuel subsidies.

If implemented with no other

changes, those moves could narrow the government’s revenue base and be credit negative for Malaysia’s sovereign, according to Anushka Shah, a senior analyst at Moody’s Investor Service.

The vote showed that Mah at h i r st i l l k now s how to w i n e lec t ions. T he v ic tor y was dominant: He swept traditional government strongholds like Johor, Kedah and Negeri Sembilan and neutralized Najib ’s advantage in the Borneo states of Sabah and Sarawak.

What’s more, Mahathir appeared to decisively win over ethnic Malay voters who’ve long underpinned the ruling party’s success. The mostly ethnic Chinese Democratic Action Party, previously the largest opposition party, was on pace to win fewer seats than in 2013.

For Ma h at h i r, t he f ight against his former protegé was particularly ugly. The two fell out over a myriad policy issues, including Najib’s decision to abolish the Internal Security Act, his performance in the 2013 general election and 1MDB. Ahead of Wednesday’s vote, Mahathir repeatedly blasted Najib, saying he “lives in fear even of my photos.”

Najib countered by saying Mahathir is “obsessive about control, calling the shots.”

‘Headache’

W hat comes next is unclear.

Ma hathir helms an unw ieldy four-pa r t y coa l it ion t hat inc ludes Ma l aysi a’s l a rgest et hnic C h inese pa r t y.

He also plans to step aside once de facto opposition leader Anwar Ibrahim—a one-time deputy to Mahathir who was fired after a dispute over economic policies in 1998—gets out of jail on a sodomy charge.

Ma h at h i r sa id he wou ld seek a pardon for Anwar, who is scheduled to be released on June 8. He also faces a five-year ban from politics.

“I have to manage four presidents of four different parties,” Mahathir said. “It’s going to be a headache.”

It’s uncertain whether the outcome will fundamentally reshape race relations in Malaysia.

Najib’s party had long staked its legitimacy on providing preferential treatment for the bumiputera, or “sons of the soil,” which include ethnic Malays and indigenous groups.

W hile voters were in the mood for change, the irony that an aging former prime minister the country for 22 years represented a fresh start wasn’t lost on some voters.

“I hope we can have a change—I want to see something different, though it was strange to see Mahathir speaking,” Avinash Naidu, 24, who works for a local phone company, said after leaving a polling station on Wednesday. “It’s going to be tough with so many different parties. But it will be good knowing a chance for change is possible.” BloombergNews

This has been a Malaysian tsunami, across the board and the country.”—Welsh

China’s ZTE halts operations after US severed supply

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TE Corp. has suspended all major activities after the United States crippled its ability to buy crucial American technology, signaling the potential collapse of one of the world’s largest makers of phones and networking gear.

China’s No. 2 telecom equipment maker said it remains intent on resolving a seven-year blockade Washington imposed as punishment for violating the terms of a 2017 sanctions settlement, then lying about it. That, however, cut off access to the components it needs to build most of its products, from Qualcomm Inc.’s semiconductors to optical chips from Lumentum Holdings Inc. ZTE’s increasingly precarious position is exacerbating tensions between the world’s two biggest economies, now in the throes of sensitive negotiations to try and forestall an internecine trade war. It essentially ran out of inventory in the month since the ban’s imposition and had no way to replenish it.

As of Thursday its web site and flagship smartphone store on Alibaba’s Tmall online marketplace had suspended sales. Carriers, including Australia’s Telstra Corp., stopped offering its devices. And ZTE’s larger telecom gear-making operation probably ran afoul of the same component shortages, said Huang Leping, an analyst with CICC.

“There is nothing ZTE can do now,” Huang said. “Its manufacturing and sales are paralyzed, but R&D [research and development] is still going on.”

ZTE’s best hope may be for intervention from Beijing—but that’s a long shot given rising tensions between the US and China.

P r e s i d e n t D o n a l d J . Tr u m p h a s threatened tariffs on $150 billion of Chinese imports for alleged violations of intellectual-property rights, while Beijing has vowed to retaliate on everything from American soybeans to planes.

The blow came just as ZTE was preparing to lead the country’s charge into the era of fifthgeneration wireless technology, along with local rival Huawei Technologies Co. Major wireless carriers around the world are preparing to spend billions rolling out 5G networks, which enable new technologies from faster Internet access to augmented reality. ZTE, which once harbored ambitions of vying with Apple Inc. in phones, has called the punishment “unacceptable” and threatened to take legal action.

ZTE, whose shares have been suspended since the imposition of the ban, said in its statement it has sufficient cash and will adhere to its commercial obligations. Company

representatives declined to elaborate further.

On Thursday shares in ZTE suppliers Mobi Development Co. and Shenzhen SDG Information Co. were down more than 1 percent.

“As a result of the denial order, the major operating activities of the company have ceased,” ZTE said in a filing to the exchange.

“The company and related par ties are actively communicating with the relevant US government departments in order to facilitate the modification or reversal of the denial order by the US government and forge a positive outcome in the development of the matters.”

ZTE’s larger rival, Huawei, also faces heightened US opposition. The justice department is said to be investigating its own compliance with American sanctions banning sales to Iran. The Pentagon has b a n n e d Z T E a n d H u a we i p h o n e s f o r sale, and the Federal Communications Commission voted in April to ban federal funds from being used to buy gear from companies deemed a national security risk.

“It is not unexpected to see ZTE’s exhausted its inventory since it can’t get more components from the key US suppliers,” said Edison Lee, an analyst with Jefferies. “The US said they are reviewing the appeal from ZTE, I think that’s a good sign.” Bloomberg News

UK Labour eyeing Brexit shift to get close to single market

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he United Kingdom opposition Labour Party is inching toward a shift in its Brexit position and moving closer to the European Union’s single market, according to two senior members of leader Jeremy Corbyn’s team.

Corbyn, a lifelong euroskeptic, is under pressure from his members of parliament, the majority of whom opposed leaving the EU and now want to stay as close as possible. Many of the younger Labour members who joined for the love of him also support staying close.

Corbyn has so far resisted calls to try

to keep Britain in the single market. Part of the problem is that it might prevent him from doing some of the things he’s promised, such as taking some businesses into state ownership. His spokesman said on Wednesday that the EU’s state aid rules were problematic.

But senior Labour lawmakers, including one member of the shadow cabinet, said privately they believed there was room for Corbyn’s position to shift. They pointed out he has already moved, accepting only in February that Britain should seek a customs union with the EU. Bloomberg News

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The World BusinessMirror

Friday, May 11, 2018

Trump’s move vs Iran nuke deal to worsen Mideast proxy wars P

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Scientists: Kilauea volcano may have explosive eruption

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EIRUT—There may not be much Iran can do about President Donald J. Trump’s withdrawal from the nuclear deal, but across the Middle East, it has a variety of ways it can hit back at the United States and America’s regional allies.

Iran has expanded its influence far beyond its borders in recent years, sponsoring an army of tens of thousands of Shiite militiamen spread across Iraq and Syria, all the way to Lebanon. A rocket attack overnight on Israeli positions in the Golan Heights may have been a first salvo, underscoring Tehran’s reach.

Israel responded with a blistering wave of missile strikes early on Thursday.

Iran also holds enormous political sway in neighboring Iraq and in Lebanon, where its main Shiite ally, the militant Hezbollah group, scored significant gains in weekend elections.

In Iraq two powerful political alliances expected to win seats in parliamentary elections on Sunday also maintain strong ties to Iran.

In his speech announcing the US withdrawal from the landmark 2015 nuclear deal, Trump called Iran the “world’s leading state sponsor of terror,” citing its support for “terrorist” proxies and militias, such as Hezbollah and Hamas, as well as its activities in Yemen.

The rivalry between Iran and Saudi Arabia has torn the region apart, playing out on regional battlefields and fanning sectarian flames in Iraq, Syria, Lebanon, Bahrain and Yemen.

Trump’s decision will likely intensify those confrontations, and could also embolden Israel to step up its own proxy battles against Tehran.

Here is a look at proxy battlefields in Iran’s looming confrontation with the US, Saudi Arabia and Israel:

Syria and the Golan Heights

Any confrontation between Iran and Israel is likely to play out first and foremost on the battlefields of Syria, where Iran has built an extensive network of militias during Syria’s civil war.

Advisers from Iran’s elite Revolutionary Guards, as well as trainers, commanders and experts, are stationed in military bases across the country.

It also has spy drones that it can use to attack from the sky. In February Israel shot down what it said was a drone that contained explosives sent by Iran from an air base in Syria, prompting Israeli airstrikes that killed at least seven Iranians. An Israeli warplane was shot down during the battle.

Israel’s main concern is southern Syria, near the Israeli-controlled Golan Heights, where Tehran has been boosting its presence for years and where it could launch rocket attacks into Israeli territory.

Israel has said it will do what it takes to fend off Iran’s military entrenchment. A series of strikes over the last few months—all blamed on Israel—have struck Iranian assets in Syria and killed Iranian forces there.

The strikes have prompted threats of retaliation from Tehran, and Israel has girded for a response, ordering bomb shelters open in the Golan.

Israel will no doubt strike back following any attack on its territory, a scenario that could spiral into a wider conf lict that

longtime foe, Israel, the border between the two countries may again heat up. Embroiled in scandals at home, Israeli Prime Minister Benjamin Netanyahu may also seek a provocation to divert attention from his domestic crises.

Yemen and Saudi Arabia

experts say no side is currently interested in.

With Trump’s backing, Israel may even feel emboldened to take further preemptive action against Iranian targets in Syria. Iran’s presence in Syria is no match for Israel’s powerful military, and Iran’s hopes of salvaging the deal and appearing moderate on the world stage may further hinder its ability to strike back.

The war in Yemen, widely seen as a proxy battle between Saudi Arabia and Iran, is another theater Tehran could exploit to inflict pain on its enemies.

Yemen’s Shiite rebels, t he Houthis, have fired a series of missiles into neighboring Saudi Arabia during the three-year-old conflict, most recently on Wednesday, a day after Trump’s announcement.

The United Nations, Western nations and Saudi Arabia say Iran supplies the Houthis with long-range missiles capable of reaching R iyadh. Iran denies arming them.

Lebanon and Israel

Gaza and Jerusalem

Southern Lebanon’s rolling hills bordering Israel are another arena of inf luence for Tehran through its Lebanese proxy, Hezbollah.

The frontier has been largely quiet since the last Israel-Hezbollah war in 2006, and Hezbollah is averse to starting a new confrontation in light of its costly intervention in Syria, where it has lost hundreds of fighters.

Launching a new war could endanger Hezbollah’s political support base, including its Shiite constituency, which is wary of another ruinous war with Israel.

Hezbollah has said, however, that it stands ready to defend Lebanon in case of any Israeli attack, and its leader has hinted it may retaliate for repeated Israeli air strikes in Syria.

Israel has repeatedly targeted weapons shipments destined for Hezbollah, taking advantage of the group’s thinly spread fighters preoccupied by the war in Syria.

With the war winding down and the group able to refocus on its

Confronted by Iranian-allied Hezbollah on its northern border, Israel also faces another enemy to the south with Hamas in Gaza.

Tehran’s relationship with the Islamic militant group has known highs and lows. Hamas developed close ties with Iran after the outbreak of the second Palestinian uprising in the early-2000s, w it h suppor t—bot h mi l itar y and financial—peaking following Hamas’s victory in the 2006 parliamentary elections.

Ties ebbed with the outbreak of the Syrian war in 2011, when the Hamas leadership-in-exile left Syria amid President Bashar al-Assad’s crackdown on Sunni Muslim rebels, many with ideologies similar to those of the Muslim Brotherhood, the parent movement of Hamas. Ties with Iran have since somewhat recovered, and Hamas is believed to again get funding from Iran.

Since late-March, Hamas has been staging weekly mass protests meant to break a stifling, decadelong Israeli-Egyptian blockade on

We are resistance factions, and we are ready to target Americans in the region in case America hits Iran. It will be a violent response.”—Husseini

Iranian demonstrators burn representations of the US flag on May 9 during a protest in front of the former US Embassy in response to President Donald J. Trump’s decision to pull out of the nuclear deal and renew sanctions, in Tehran, Iran. AP/Vahid Salemi

the impoverished territory.

Thousands of Palestinians have demonstrated along Israel’s border fence with Gaza, with some briefly crossing into Israeli territory, hurling burning tires and damaging the fence. Dozens have been killed

by Israeli fire and hundreds have been wounded.

The protests are set to intensify on Monday when the US Embassy opens in Jerusalem. Tens of thousands of Palestinians are set to descend on the border area and mass breaches of the border fence may be inevitable.

Iraq

Iran sponsors a range of Shiite militias in Iraq and has deep ties to the country’s economy and political system. Many Iraqis fear escalating tensions between the US and Iran will destabilize Iraq just as the country is starting to recover.

Riad Hadi, an Iraqi army veteran, said Iraq would end up paying the price for Trump’s withdrawal from the nuclear deal.

“If they blockade Iran, the pressure release will be Iraq,” said the 48-year-old, who was wounded in both legs in a bomb blast in his Baghdad neighborhood.

On Wednesday a power f u l Iraqi paramilitary group with links to Iran said Trump’s withdrawal from the nuclear deal would “ignite the region.”

“We are resistance factions, and we are ready to target Americans in the region in case America hits Iran. It will be a violent response,” said Jafar Husseini of Iraq’s Hezbollah brigades.

There are some 5,000 US troops in Iraq training Iraq’s military after the country declared victory over the Islamic State group last year.

Assassinations and attacks

Amid rising tensions between Israel and Iran, a return to assassinations and overseas attacks cannot be ruled out.

Iran blamed Israel for the assassination of at least four Iranian nuclear scientists between 2010 and 2012 and arrested a number of Iranians alleged to have carried out the killings on behalf of Israel’s Mossad spy agency.

In 2011 US officials said they foiled an Iranian plot to assassinate Saudi Arabia’s ambassador to the United States, Adel al-Jubeir, the current Saudi foreign minister. AP

AHOA, Hawaii—Geologists warned on Wednesday that Hawaii’s Kilauea volcano could erupt explosively and send boulders, rocks and ash into the air around its summit in the coming weeks.

The risk will rise as lava drains from the summit crater down the flank of the volcano, and explosions could occur if the lava drops below the groundwater level, the US Geological Survey (USGS) said.

There’s also potential for ash, steam and sulfur-dioxide emissions. Kilauea is one of the world’s most active volcanoes.

It has destroyed 36 structures since it began releasing lava from fissures that opened in a Big Island neighborhood about 40.2 kilometers east of the summit crater. There are now 15 of the vents spread through Leilani Estates and neighboring Lanipuna Gardens.

In the weeks ahead, the volcano could eject blocks up to 1.8 meters in diameter a little less than 1.6 kilometers away, the USGS said. It may also send pebbles shooting into the air several miles away, the USGS said.

The receding lava lake resembles conditions seen before a major summit eruption in 1924, said Tina Neal, scientist in charge at the USGS Hawaiian Volcanoes Observatory.

That explosion killed one person and sent rocks, ash and dust into the air for 17 days.

This event could occur again when the lava lake drops so low that groundwater is able to flow into the conduit that feeds magma to the summit crater. The magma would heat the water, sending steam into the air that would push any accumulated rocks out in an explosion.

Don Swanson, a geologist with the Hawaiian Volcano Observatory, said the magma is likely to drop below the water table around the middle of the month.

Scientists don’t know how long after that it an explosion could occur.

“We suspect it’s a rapid process. We really

don’t know for certain,” he told reporters on a conference call.

No one lives in the immediate area of the summit crater. The Hawaii Volcanoes National Park, which includes the crater and surrounding region, announced on Wednesday that it will shut down on Friday in anticipation of the possible explosive event.

“It seems pretty safe to me right now but they’d know best,” said Cindy Woodd, who was visiting from British Columbia, Canada. “We don’t know what’s going on underground. Life and safety is what’s most important.”

Separately, Hawaii Gov. David Ige said a geothermal energy plant near the lava outbreak was accelerating its removal of stored flammable gas.

The Puna Geothermal Venture plant has about 189,270 liters of pentane on site but he expected this would all be removed by the end of the day on Thursday.

It would be “very, very hazardous” if a volcanic vent were to open under the facility where the fuel is stored, the governor said.

The plant, which is owned by Ormat Technologies of Reno, Nevada, is across the highway from where lava has been erupting.

Authorities previously ordered nearly 2,000 residents to leave the neighborhoods in and around the vents in the mostly rural district of Puna. But some ignored the order and stayed to watch over their property. Authorities went door-to-door in Lanipuna to get people out of their homes on Tuesday.

Police said on Wednesday they arrested a man suspected of burglarizing homes in Leilani Estates. A resident saw the man leaving his house when he returned to retrieve personal belongings. The resident and a friend took the suspect to police officers who arrested him.

Some residents have refused to follow evacuation orders because of fears their homes will be looted. AP

CIA nominee: Torture doesn’t work as interrogation tool

W

ASHINGTON—President Donald J. Trump’s Central Intelligence Agency (CIA) nominee said on Wednesday at her confirmation hearing that she doesn’t believe torture works as an interrogation technique and that her “strong moral compass” would prevent her from carrying out any presidential order she found objectionable.

Under questioning by members of the Senate Intelligence Committee, acting CIA Director Gina Haspel said she would not permit the spy agency to restart the kind of harsh detention and interrogation program it ran at black sites after September 11. It was one of the darkest chapters of the CIA’s history and tainted America’s image worldwide.

Senators asked how she would respond if Trump—who has said he supports harsh interrogation techniques like waterboarding and “a hell of a lot worse”— ordered her to do something she found morally objectionable.

“I would not allow CIA to undertake activity that I thought was immoral, even if it was technically legal,” said Haspel, a 33-year veteran of the agency. “I would absolutely not permit it.”

When asked if she agrees with the president’s assertion that torture works, Haspel said: “I don’t believe that torture works.”

She added that she doesn’t think Trump would ask the CIA to resume waterboarding, which simulates drowning.

Haspel, vying to become the first female CIA director, faces what will likely be a close confirmation vote in the full Senate.

While she has deep experience, her nomination is contentious because she was chief of base of a covert detention site in Thailand where terror suspects were waterboarded.

There also have been questions about how she drafted a cable that her boss used to order the destruction of videotapes of interrogation sessions conducted at the site.

After the hearing, Republican Sen. John McCain of Arizona, a leading voice against harsh interrogation, issued a statement urging his colleagues to vote against Haspel’s confirmation.

“I believe Gina Haspel is a patriot who

loves our country and has devoted her professional life to its service and defense.

However, Ms. Haspel’s role in overseeing the use of torture by Americans is disturbing.

Her refusal to acknowledge tor ture’s immorality is disqualifying,” said McCain, who was detained and beaten in prison during the Vietnam War. He is at home in Arizona while battling brain cancer and is not expected to be able to vote. While it’s unclear what effect McCain’s stance will have on Haspel’s confirmation, his views carry clout as a voice of principle from the only senator now serving who has been held captive during wartime.

Protesters disrupted the hearing shouting, “Prosecute the torturers!” and “Bloody Gina!” Haspel remained stonefaced as police escorted them out of the room.

“I realize that there are strong disagreements on the effectiveness of the CIA’s detention and interrogation program,” Haspel wrote in answers to more than 100 questions submitted by committee members and released at her hearing.

“In my view—a view shared by all nine former directors and acting directors—the CIA was able to collect valuable intelligence that contributed to the prevention of further terrorist attacks. That said, it is impossible to know whether the CIA could have obtained the same information in another way,” she wrote.

She also said there is little question that the program harmed CIA officers who participated and that it damaged US relations with allies.

Being in the public spotlight is new for Haspel. She spent more than 30 years working undercover, acquiring secret information from dead drops and at meetings in dusty back alleys of thirdworld capitals.

Still, the 61-year-old intelligence professional portrayed herself as a “typical middle-class American” with a “strong sense of right and wrong.” She said she was born in Kentucky as the eldest of five children. While her family has deep roots there, she grew up as an Air Force brat, following her father to postings all over the world. AP

www.businessmirror.com.ph

The World BusinessMirror

Friday, May 11, 2018

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Trump welcomes 3 freed Korean-Americans

J

OINT Base Andrews, Maryland—Three Korean-Americans who were detained in North Korea for more than a year were greeted by President Donald J. Trump beneath a giant American flag after they returned to the mainland US early on Thursday.

Despite a middle-of-the-night landing, first lady Melania Trump, Vice President Mike Pence and a host of senior administration officials joined Trump to celebrate the occasion.

The men—Kim Dong-chul, Kim Hak-song and Tony Kim—had been released on Wednesday, amid a warming of relations between the longtime adversaries.

The president and first lady boarded the medical plane on which the men traveled to take a private moment with them, then appeared at the top of the airplane stairway with the three and applauded as the men held up their arms in what appeared to be gestures of triumph.

“This is a special night for these three really great people,” Trump told reporters as he stood on the tarmac with the former detainees.

On the United States relationship with North Korea, Trump said, “We’re starting off on a new footing.”

In thanking North Korea’s Kim Jong Un for releasing the three Americans, Trump said he believes Kim wants to reach an agreement on denuclearizing the Korean Peninsula. “I really think he wants to do something,” the president said.

After Trump’s remarks, the three men boarded a bus for Walter Reed National Military Medical Center. The White House said earlier they would be evaluated and receive medical treatment at the Washington-area facility.

Their families were not on hand for the ceremony.

Secretary of State Mike Pompeo had secured their release in Pyongyang after meeting with North Korean leader Kim Jong Un on final plans for a Trump-Kim summit.

The Americans had boarded Pompeo’s plane out of North Korea without assistance and then transferred in Japan to a Boeing C-40

outfitted with medical facilities for the trip back to the US. Shortly after they touched down on American soil in Alaska— for a refueling stop on Wednesday afternoon—the State on Department released a statement from the freed men.

“We would like to express our deep appreciation to the United States government, President Trump, Secretary Pompeo and the people of the United States for bringing us home,” they said.

“We thank God, and all our families and friends who prayed for us and for our return. God Bless America, the greatest nation in the world.”

Singapore has emerged as the likely summit site, late this month or in early-June, as Trump seeks to negotiate denuclearization of the Korean Peninsula in his higheststakes foreign policy effort yet.

Trump announced on Wednesday that the Demilitarized Zone between the Koreas would not host the summit. Pompeo said the meeting would last one day and possibly a second.

Trump made a point of publicly thanking North Korea’s leader for the prisoners’ release—“I appreciate Kim Jong Un doing this”—and hailed it as a sign of cooling tensions and growing opportunity on the Korean Peninsula.

Kim decided to grant amnesty to the three Americans at the “official suggestion” of the US president, said North Korea’s official news agency, KCNA. North Korea had accused the three Korean-Americans of antistate activities. Their arrests were widely seen as politically motivated and had compounded the dire state of relations over the isolated nation’s nuclear weapons.

Trump entered office as an emboldened North Korea developed new generations of nuclear

President Donald J. Trump (from left) greets Tony Kim, Kim Hak-song (seen in the shadow) and Kim Dong-chul, the three Korean-Americans detained in North Korea for more than a year, as they arrive at Andrews Air Force Base in Maryland on May 10. First lady Melania Trump (right) also greets them. AP/Susan Walsh

weapons and ballistic missiles capable of hitting the continental US. Those advances were the subject of President Barack Obama’s starkest warning shortly before Trump took office, and this is a crisis he’s convinced his negotiating skills can resolve.

Crediting himself for recent progress, Trump has pointed to Kim’s willingness to come to the negotiating table as validating US moves to tighten sanctions— branded “maximum pressure” by the president.

The wee-hours ceremony on Thursday was to be an early celebration for an issue that has already put the prospect of a Nobel Peace Prize on Trump’s mind.

“Ever yone thinks so, but I would never say it,” he said on Wednesday when asked if the award was deserved.

The release capped a dramatic day of diplomacy in Pyongyang.

After Pompeo’s 90-minute meeting with Kim Jong Un, he gave

reporters a fingers-crossed sign when asked about the prisoners as he returned to his hotel.

It was only after a North Korean emissary arrived a bit later to inform him that the release was confirmed.

The three had been held for periods ranging from one to two years. They were the latest in a series of Americans who have been detained by North Korea in recent years for seemingly small offenses and typically freed when senior US officials or statesmen personally visited to bail them out.

The highly public and politically tinged arrival ceremony for the former prisoners organized by the White House was in stark contrast to the low-key and very private reception that the State Department had envisioned and carried out from the moment they took custody of them.

Department officials took great pains on their release in North Korea, as well as on their flights to

We are happy they’ve returned, but North Korea shouldn’t gain by taking Americans and then releasing them.”—Schumer

Japan and Alaska, to keep them sequestered not only from the two journalists traveling with Pompeo but also from staffers not immediately involved in their cases.

The trio, along with medical personnel, including a psychiatrist, were cloistered in the middle of Pompeo’s plane in a small section of 12 business class-sized seats that was cordoned off by curtains on both ends.

State Department officials refused to discuss anything but the most basic details of their conditions, citing privacy concerns in keeping with the minimal amount of information they had released since the men were imprisoned.

The fact that Trump was going to Andrews to welcome them home in person was almost an afterthought to Pompeo, who, when briefing reporters on their release, noted it last of all.

“The only other thing I should mention is I did speak with the president,” Pompeo said. “I informed the president of this, and the president is planning to come out and meet the aircraft when we land.”

The last American to be released before this, college student Otto Warmbier, died in June 2017, days after he was repatriated to the US with severe brain damage.

War mbier was ar rested by North Korean authorities in January 2016, accused of stealing a propaganda poster and sentenced to 15 years in prison with hard labor.

His parents, Fred and Cindy Warmbier, have filed a wrongful death lawsuit, accusing the government of torturing and killing their son.

“We are happy for the hostages and their families,” the Warmbiers said in a statement on Wednesday.

“We miss Otto.”

Of the newly released detainees, Kim Dong-chul, a South Koreanborn US citizen, had been held the longest. The former Virginia resident was sentenced in April 2016 to 10 years in prison with hard labor after being convicted of espionage.

He reportedly ran a trade and hotel service company in Rason, a special economic zone on North Korea’s border with Russia.

The other two detainees hadn’t been tried.

Kim Hak-song worked in agricultural development at an experimental farm run by the Pyongyang University of Science and Technolog y (PUST ). T he university is the only privately funded college in North Korea and was founded in 2010 with donations from Christian groups. He was detained last May for alleged anti-state activities.

Tony Kim, who also uses the name Kim Sang-duk, was detained in April 2017 at the Pyongyang airport. He taught accounting at PUST. He was accused of committing unspecified criminal acts intended to overthrow the government.

On Capitol Hill, Senate Democratic leader Chuck Schumer celebrated the detainees’ return but warned that “we’ll see many more hostages” if the administration provides an incentive for imprisoning Americans.

“We are happy they’ve returned, but North Korea shouldn’t gain by taking Americans and then releasing them,” he said.

North Korea’s state-run media explicitly mentioned plans for the summit for the first time.

Pyongyang has been exceptionally cautious about its public framing of Kim’s recent diplomatic moves, which are a major shift from the more aggressive focus on missile launches and nuclear development that heated tensions to a boil last year. AP

Texas suit could get Daca on faster track to S. Court W

ASHINGTON—Three judges have ordered the Trump administration to continue a program that has shielded hundreds of thousands of young immigrants from deportation.

Now, a lawsuit filed last week in Texas seeks to shut down the Deferred Action for Childhood Arrivals (Daca) program and may create a legal clash that could speed the issue’s path to the Supreme Court (SC).

President Donald J. Trump’s decision last September to phase out the Obama-era program resulted in protests and a failed congressional effort to salvage it.

Experts say it’s a matter of when, not if, the SC will rule on the program. It could be the second opportunity for the high court to weigh in on a high-profile decision of the

president’s, with a ruling on Trump’s travel ban expected before the end of June.

Josh Blackman, a professor at South Texas College of Law Houston, said the Texas lawsuit filed on May 1 tees up “a fast pass to the Supreme Court.”

If Texas and six other states persuade a judge to issue a nationwide order barring the government from continuing Daca, that decision could conflict with existing judges’ orders telling the government it must partially continue the program. That’s the kind of conflict the SC generally steps in to address. The high court has already finished hearing arguments ahead of its summer break at the end of June, and it’s rare for the court to hear arguments again before October.

But if judges issue conflicting orders on what the government must do with Daca, the court might be asked to make an interim, procedural decision, said Stephen Yale-Loehr, who teaches immigration law at Cornell University’s law school.

The Texas lawsuit “creates even more uncertainty in what is going to happen,” he said.

Daca, created in 2012, has provided protection from deportation and work permits for about 800,000 young people who came to the United States as children and stayed illegally. A person enrolled in the program gets protection from deportation that lasts two years and can be renewed.

Judges in California and New York have ruled that the Trump administration must

allow current Daca participants to renew their enrollments, but the government doesn’t have to process new applications.

A ruling by a judge in the District of Columbia would require the government to also process new applications, but it has been put on hold until late July.

While these lawsuits challenged Trump’s decision to wind down Daca, the lawsuit filed by Texas, Alabama, Arkansas, Louisiana, Nebraska, South Carolina and West Virginia aims to end it.

The states argue the creation of the program was unlawful, an overreach by President Barack Obama, a conclusion the Trump administration agrees with.

And the states filed the case in a way to put it before a potentially sympathetic

judge, US District Judge Andrew Hanen in Brownsville, Texas.

Hanen criticized the Obama administration for lax enforcement of immigration laws. And in 2015 he ruled against an expansion of Daca by Obama, as well as a program that would have protected the parents of children who are in the country legally.

His ruling blocking the programs was upheld by an appeals court. The Supreme Court, short a member after the death of Justice Antonin Scalia, was divided 4-4 on the case in 2016, leaving the lower court’s ruling in place.

University of Texas law professor Stephen Vladeck said the Texas case “increases the likelihood of conflicting orders to the

government and conflicting substantive conclusions about Daca’s legality.”

I f H a n e n s i d e s w i t h t h e s t ate s, h e co u l d o rd e r t h e g ove r n m e nt to immediately stop processing new Daca applications or renewing old ones, which would contradict the existing orders.

That would create a “pretty chaotic” situation that the SC would likely want to resolve, Vladeck said.

Beyond what happens in Texas, two courts of appeal are readying to weigh in on Daca, too. Arguments before the San Francisco-based US Court of Appeals for the 9th Circuit are scheduled for Tuesday. And arguments before the New York City-based US Court of Appeals for the 2nd Circuit are expected this summer. AP

Banking&Finance

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BusinessMirror

Friday, May 11, 2018 • Editor: Jun B. Vallecera

www.businessmirror.com.ph

‘Financial inclusion beginning to happen’

By Rea Cu

T

@ReaCuBM

he Philippines has enough financial firepower or fiscal space to ramp up spending, and by this measure achieve the high growth needed to make financial inclusion happen, the Department of Finance said on Thursday.

Finance Secretary Carlos G. Dominguez III said even more aggressive spending on the “Build, Build, Build” (BBB) program and other poverty-reduction initiatives would allow the government to achieve local output growth measured as the GDP averaging 7 percent or better.

T his, in tur n, should help reduce the povert y-incidence rate to only 14 percent over the

medium term instead of some 21 percent at present.

“President Duterte’s commitment to attaining an investment-led and inclusive economy via a massive public spending strategy would usher in what the Asian Development Bank [ADB] has forecast to be the ‘golden age’ of the Philippines’s economic g row t h,” Dom i ng uez sa id i n reaction to the announcement

by t he Phi l ippine Stat ist ica l Authority (PSA) on GDP growth o f 6 . 8 p e rc e nt i n t h e f i r s t quarter.

The PSA said the industr y s e c t o r re c o rd e d t he f a s t e s t growth averaging 7.9 percent, while the services sector expanded 7 percent and agriculture at 1.5 percent. It further said the services sector had the highest contribution to GDP expansion with 4 percentage points, followed by industry with 2.7 percentage points and agriculture with 0.1 percentage points.

Socioeconomic Planning Secretary Ernesto M. Pernia noted the growth report was the 10th consecutive quarter when economic expansion stood above 6.5 percent.

“With President Duterte’s foreign policy recalibration, which has enabled the government to secure ODA [official development assistance] from our friends in the region plus grants and

DOMINGUEZ

concessional loans from multilateral institutions; above-target performance by our revenue agencies as a result of the TRAIN [Tax Reform for Acceleration and Inclusion] law; and investmentgrade credit ratings responsible for successful bond floats here

and abroad, the government now enjoys a large headroom for high and inclusive growth,” Dominguez said.

The growth-boosting BBB program is now in full swing, with 35 projects having already been approved by the National Economic and Development Authority (Neda) Board, from the total of 75 big-ticket infrastructure projects worth $170 billion designed to reverse regional underdevelopment and income inequality by creating growth corridors all over the country.

“Of these projects, 35 have a l ready pa ssed t he approva l process, while the rest are expected to get the go-ahead before year-end. Our people will feel the economic benefits of these projects soon enough, and our country would move up to upper middle-income status by the time the President leaves office in 2022,” he said.

Dominguez also said that, in

the first three months, the TRAIN law delivered on its promise to help provide a steady revenue flow for the government’s massive investment program.

The Bureau of Internal Revenue collected in the first quarter P423.1 billion or a 14 percent more year-on-year (YoY), from P370.404 billion, while the Bureau of Customs collected P129.8 billion, or a 25-percent increase, from last year when this totaled only P104.13 billion.

The Department of Budget and Management reported total government disbursements of P782 billion, or a 27-percent increase YoY. Of this amount, P157.1 billion went to infrastructure, or a 34-percent increase from the year-ago amount.

Dominguez said revenue collections would go up further with the succeeding packages of the Comprehensive Tax Reform Program, which the Congress is expected to act on this year.

Solon moves to amend TRAIN law, internal revenue code DOF disputes suspension

By Butch Fernandez

T

@butchfBM

he Senate, when it resumes plenary sessions next week, is poised to consider a bill amending the National Internal Revenue Code to allow the automatic suspension of the excise tax on fuel provided for in the Tax Reform for Acceleration and Inclusion (TRAIN) law.

In filing Senate Bill 1798, Sen. Paolo Benigno A. Aquino IV proposed the adoption of a new provision in the TRAIN law under Section 148-B which states that “the imposition of excise tax on fuel under Republic Act 10963 [TRAIN] shall be automatically suspended when the average inflation rate for a three month period exceeds the annual inflation target range set by the Development Budget Coordination Committee and the Bangko Sentral ng

Pilipinas; provided, however, that the excise tax on fuel prior to the effectivity of RA 10963 shall remain in force during the period of suspension.”

Aquino’s bill adds that should the average inf lation stabilize and fall below annual target for three consecutive months, the Department of Finance has the prerogative to lift the suspension and reimpose the excise tax on fuel based on its rate at the time of suspension.

“While we have little control over global fuel prices, the imposition of excise taxes is in our hands,” Aquino asserted, reminding fellow lawmakers that “it is our responsibility to be flexible and responsive when the weight of inflation becomes too heavy for the poor Filipino families to bear.”

Moreover, he pointed out that progress cannot be built “at the expense of hungry Filipinos with

little opportunity to improve their day-to-day lives.”

“Our challenge is to strike a balance between our macroeconomic goals and providing relief and support to Filipinos with the

least in our society, and with open minds, open hearts, creativity and innovation, I believe we can find that delicate balance and create a prosperous future for all,” Aquino added.

Case clippings

By Justice S J Ranada Jr. LAWYERS—disciplinary proceedings Disciplinary proceedings against lawyers are sui generis. Neither purely civil nor purely criminal, they do not involve a trial of an action or a suit, but is rather an investigation by the Court into the conduct of one of its officers. It involves neither a plaintiff nor a prosecutor and may be initiated by the court motu proprio, to determine if the attorney is still fit to be allowed the privileges as such.

Rico v. Atty. Salutan AC No. 9257 05 Mar. 2018 Peralta, J

Japan’s Bitcoin king poaches Wall Street Long-horizon foreign funds expand 53% talent for cryptocurrency empire

Y

uzo Kano is trying to build a global cryptocurrency powerhouse, one former financier at a time.

The Goldman Sachs Group Inc. alumnus, who turned bitFlyer Inc. into Japan’s largest Bitcoin exchange, is scooping up traders and bankers from both his old employer and former rivals as he embarks on an ambitious international expansion. Kano’s team, which includes a former fixed-income desk head at Barclays Plc. and an ex-senior private banker at Credit Suisse Group AG, has doubled to more than 150 people in the past six months and is on pace to top 300 before year-end.

While he’s far from the only crypto boss to poach talent from Wall Street firms, Kano has been among the most aggressive in taking advantage of recent Japanese regulations that make the finance-to-crypto leap less daunting.

The nation’s virtual currency exchanges are now licensed by Japan’s securities watchdog, giving the venues an official stamp of approval that’s largely absent from countries like the US and Britain. For Kano, that makes Japan the ideal base for an increasingly global operation.

“My target is to be number one in the world,” the former derivatives and convertible bonds trader said in an interview from his office in Midtown Tower, the tony Tokyo skyscraper that’s also home to Blackstone Group and Bain & Co. “To get there, I need to grow headcount. And those with the best skills come from global banks.”

Kano’s four-year-old exchange is already the world’s fourth-largest crypto venue by turnover, after BitMex, Binance and OKEx, according to data compiled by Bloomberg from exchanges, Coinhills and Coinmarketcap.com. Transactions on bitFlyer averaged about $2 billion a day during late-April and early-May, thanks in large part to Bitcoin margin contracts popular with Japanese day-traders. The venue’s users have tripled

in the past year to 2 million.

On top of existing locations in Tokyo, San Francisco and Luxembourg, Kano is eyeing new offices in Africa, South America, Australia and other parts of Asia. He’s also expanding beyond crypto trading to businesses that include digital payments and a brokerage-advisory service for investors and start-ups interested in initial coin offerings. The strategy is similar to that of Mike Novogratz, another Goldman alum who recently started a New York-based crypto merchant bank.

Kano, bitFlyer cofounder and CEO, said former traders and bankers are ideal for crypto firms because they understand how to operate in regulated markets—a skill set that’s becoming more important as governments around the world scrutinize an industry notorious for security lapses and money laundering risks. Last month bitFlyer tightened its anti-money laundering rules after the Nikkei newspaper reported that users could perform some limited functions without fully completing customer verification.

“Crypto companies need finance guys to fill roles across the board: business development, sales, account management, operations, and compliance just to name a few,” said Razin Ashraf, head of Tokyo-based recruiting firmDivine Solutions Japan.

Of course, technology matters too. Kano’s hiring spree also includes coders, who can make $100,000 at bitFlyer with a high school —or even middle school—education if they’ve got a track record of success at hackathons or coding tournaments.

Kano, 42, said bitFlyer’s ideal finance recruits fall into one of two groups: experienced bankers in their 40s tired of corporate bureaucracy, or younger associates in their 20s who’ve become disillusioned with the industry and are hungry for a taste of startup life. Bloomberg News

over two months

T

By Bianca Cuaresma

@BcuaresmaBM

he Philippines remains a positive spot for longterm investments, and foreign players in February continue to pour capital into the country for potential gain, based on data from the Bangko Sentral ng Pilipinas (BSP).

The BSP on Thursday reported a 46.4-percent rise in the country’s foreign direct investments (FDI) to $573 million during the month.

Most of the inflows were long-term investments made by foreign players in the form of so-called intercompany borrowings.

Intercompany borrowings, essentially debt extended by foreign principals to their Philippine affiliates, grew 56.3 percent in February alone and accounted for $412 million of the $573 million extended during the period.

The remaining $161 million worth of FDI in February represented the aggregate of reinvestment of earnings and equity capital placements. In particular, net equity capital contributed $96 million to the pool, rising by 55.4 percent, from the previous year’s level.

The BSP said the capital placements were traced to investors from Hong Kong, the United States, China, the Netherlands and Japan, and were invested mainly in the arts, entertainment and recreation; real estate; manufacturing; construction; and electricity, gas, steam and air-conditioning supply activities.

Meanwhile, reinvestment of earnings amounted to $65 million during the month.

In the first two months this year, FDI net inflows rose by 52.6 percent to $1.5 billion.

The BSP said the sustained direct investment inflows in the first two months mirrors investor confidence in the country’s macroeconomic fundamentals and its growth prospects. In particular, net investments in debt instruments reached $793 million, representing a 10-percent growth from the level recorded in the same period last year.

of excise tax reform law

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he Department of Finance (DOF) abhors the suspension of measures under the Tax Reform for Acceleration and Inclusion (TRAIN) law, as this will result to a slowdown in the government’s infrastructure buildup program under the “Build, Build, Build” (BBB) initiative. Such a measure should also hamper the salary increases for the country’s uniformed personnel, among other unintended consequences.

Finance Secretary Carlos G. Dominguez III pointed out on Thursday that suspending excise the taxes levied under the TRAIN law to help keep inflation levels in check as pointed out by the Senate would only result to a slowdown in the BBB program designed to modernize the country’s infrastructure backbone.

“Suspension of the tax-reform program will certainly tend to slow down the BBB program, and possibly negatively affect the government’s ability to fund the free tuition fee program, as well as increase in salaries of the police and the military,” Dominguez told financial reporters in a text message.

On Wednesday the Senate Economic Affairs Committee hinted broadly of suspending later this year the excise tax levied under the TRAIN law to help keep runaway inflation in check, Sen. Sherwin T. Gatchalian said.

Asked if rising inflation warrants the suspension of the excise tax schedule imposition of higher tax imposed in the TRAIN law, Gatchalian indicated he would “need one more quarter” to assess if the situation warrants tax suspension.

Gatchalian pointed out that, when inflation “goes past 4 percent, then we will have to recommend drastic measures either to suspend the excise tax or to add more cash transfers,” adding the members of the Committee on Economic Affairs would then “have to make a decision on what to do by the end of the third quarter.”

Headline inflation in April accelerated to 4.5 percent, the fastest in more than five years. The fullyear target of the government for inflation ranges from 2 percent to 4 percent.

In January the DOF said the rolling out of the 75 f lagship projects worth a combined total of $36 billion in investments under the Duterte administration’s BBB program will modernize the country’s infrastructure backbone and will help sustain the country’s rapid growth.

According to DOF Undersecretary Grace Karen G. Singson, the

BBB program is in keeping with the government’s goal to sustain rapid growth, attract investments and attain economic inclusion for all Filipinos.

She added that the enactment into law of the TRAIN, which will ensure a steady revenue flow totaling P786 billion over the medium term, along with prudent fiscal management and declining debt service payments, will help make the ambitious infrastructure buildup financially feasible Singson, who heads the DOF’s Privatization Group and Office of Special Concerns, said the Duterte administration intends to spend $158 billion over the next five years on its BBB program, such that infrastructure spending would equal 7.3 percent of GDP by the end of the President’s term in 2022.

The 75 flagship projects, that consists of six airports, nine railways, three bus rapid transits, 32 roads and bridges, and four seaports, will help bring down the costs of production, improve rural incomes, encourage countryside investments, make the movement of goods and people more efficient, and create more jobs in the country, among others.

For 2018 the national budget program has earmarked P1.1 trillion for infrastructure development with the budgets of the Departments of Public Works and Highways and Transportation growing by 40.3 percent and 24.3 percent, respectively.

The TRAIN will partly fund the infrastructure program, as 70 percent of the incremental revenues from the tax-reform law will be earmarked for infrastructure.

In January this year, President Duterte signed Joint Resolution 1 increasing the base pay for the uniformed personnel in the country, including policemen and soldiers. The resolution crafted a two-tranche increase in 2018 and 2019.

In March the Commission on Higher Education launched the implementing rules and regulations for the free tuition law, saying the government will shoulder the tuition and fees of students enrolled in 112 state universities and colleges, 78 local universities and colleges, and technicalvocation education and training programs registered under the Technical Education and Skills Development Authority, starting school year 2018-2019.

The budget for the free tuition program set aside in the current budget year amounts to P51.4 billion. Rea Cu

Agriculture/Commodities BusinessMirror

www.businessmirror.com.ph

Philex copper, gold output declined in Q1

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HILEX Mining Corp. said its gold and copper output in the first quarter fell by 20 percent and nearly 9 percent, respectively, despite a 10-percent hike in total milling tonnage.

The company, led by businessman Manuel V. Pangilinan, said the decline in production slashed its net income in the January-to-March period by nearly 30 percent.

In its disclosure to the local bourse on Thursday, the miner attributed the cut in its metal production to “[lower] ore grade, lower recoveries and equipment repairs.”

Output declined despite the expansion of total milling tonnage by 10 percent to 2.2 million metric tons, from 2 MMT a year ago.

“This was achieved as productionrelated issues, such as bouldery ore, manpower shortage and ground conditions, were generally addressed during the course of 2017,” the company said.

Philex said its total gold output in the three-month period sank by 20.06 percent to 17,947 ounces, from 22,451 ounces recorded in the same period last year. The company said its average gold ore grade reached 0.329 grams per metric ton, 21.85 percent lower than the 0.209 grams per MT recorded a year ago. Its metal recovery fell to 79 percent from 84 percent recorded last year.

“Revenue from gold, on the other hand, amounted to P1.237 billion [from last year’s P1.426 billion] as higher average gold prices, which reached $1,338 per ounce [from last year’s $1,264 per ounce], partially offset the impact of lower output,” the company said.

The miner said its copper production in the first three months of the year reached 7.1 million pounds, 8.97 percent lower than the 7.8 million pounds recorded a year ago.

The miner added that its average copper ore grade went down by 11.48 percent to 0.185 percent, from 0.209 percent last year. Its copper metal recovery declined to 79 percent, from 84 percent a year ago.

“However, with realized copper prices averaging $3.10 per pound during the period [from last year’s $2.77 per pound], revenue from copper totaled P1.117 billion [from last year’s P1.094 billion], despite lower copper production,” it said.

Philex said its total revenue from silver production in the first quarter declined by 14.15 percent to P18.8 million, from the P21.9 million recorded a year ago. This brings the company’s consolidated operating revenues during the period to P2.373 billion, 6.65 percent lower than the P2.542 billion recorded amount in the first quarter of 2017.

Philex said it was able to reduce its cash costs and expenses by 2.12 percent to P1.288 billion, from P1.316 billion, as production costs during the period slid to P1.064 billion, from P1.112 billion recorded a year ago. This was attributed to “lower cost of power and raw material expenses.”

The miner said its general and administrative expenses also declined by 13.02 percent to P81.5 million, from P93.7 million “as the company continued to prudently manage its resources.”

However, the company said it suffered from higher depletion and depreciation charges, as well as higher excise taxes“due to the effectivity of the 100-percent increase in excise tax rates under the Tax Reform for Acceleration and Inclusion law Package 1.”

Philex said its depletion and depreciation charges rose by 16.27 percent to P408.8 million, while excise taxes went up by 29.38 percent to P143.1 million.

These boosted the miner’s consolidated operating costs and expenses to P1.697 billion, 1.74 percent higher than the P1.668 billion amount recorded a year ago. As a result, Philex said, its net income in the first quarter sank by 29.95 percent to P302.8 million, from the previous year’s P432.3 million.

“The results of the first three months of the year reveal the challenges for Padcal as it mines the fringes of its current ore body. This makes achieving an extension to mine life imperative to sustain operations and continue our commitment to our stakeholders,” Eulalio B. Austin Jr., Philex president and CEO said in a statement. Jasper Emmanuel Y. Arcalas

Editor: Jennifer A. Ng • Friday, May 11, 2018 A9

DA to tweak rules for MAV rice imports

By Jasper Emmanuel Y. Arcalas

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@jearcalas

he Department of Agriculture (DA) is proposing to amend rules for the allocation of permits and accreditation of traders who want to import rice via the minimum access volume (MAV) scheme of the World Trade Organization.

Agriculture Undersecretary Bernadette Romulo-Puyat said she is more partial to auctioning off rice imported via MAV, which is currently pegged at 805,200 metric tons (MT).

Puyat noted that buying imported via an open tender is “more transparent.”

Puyat, who represents Agriculture Secretary Emmanuel F. Piñol at the National Food Authority Council, said she also plans to replace the current NFA-MAV committee, which screens rice importers, with an ineragency committee.

“There are those who are saying that the NFA has sole discretion when it comes to giving import permits. I said why not do it via open auction?” she told reporters in an interview.

“And that’s not the only problem.

Who is prequalifying the accredited importers? It is just the NFA, so what I want is to put in place a committee that would also include the Neda [National Economic and Development Authority], BSP [Bangko Sentral ng Pilipinas], and DOF [Department of Finance],” she added.

Puyat said the NFAC is set to discuss the proposed measures in a meeting on May 11. The NFAC is the highest policymaking body of the NFA, now an attached agency of the DA. Once the measures are finally

agreed upon, the NFAC will pass a resolution implementing and applying the changes for the remaining import volume under the MAV, which are expected to arrive starting June until August.

“We are doing this so that there will be no collusion. I am not saying that the NFA is corrupt, but what we want is for the public to have trust [in the process],” Puyat said.

She also said the open auction may be held at the Bureau of Treasury and not at the NFA office or at the DA. Puyat said this would help dispel notions that the allocation of imports is being rigged.

Puyat noted that holding an open tender for rice under the MAV scheme is nothing new as it has been done by previous NFA chiefs, such as Angelito Banayo.

“Personally, I do not want to have discretion in the issuance of permits.

Not me and not the NFA. So, that if there is no discretion involved, the playing field is leveled,” she added.

Puyat also said she is not keen on increasing the NFA’s rice imports, as the volume purchased via the government-to-government mode and an open tender is “more than enough.”

“The good thing about importing via MAV is that the tariffs collected go to the Acef [Agricultural Competitiveness Enhancement Fund],

File photo

which is allocated to the agriculture sector,” she said.

Inventory

Data from the Philippine Statistics Authority (PSA) showed that the country’s total rice inventory as of April 1 recovered from a sixmonth skid and rose by nearly 29 percent to 2.182 million metric tons (MMT).

However, the PSA said the latest rice stockpile is 18.42 percent below the 2.675 MMT recorded a year ago.

The PSA told the BusinessMirror that the Philippines’s total rice inventory as of April 1 is good for 64 days. This is now the highest inventory recorded by the country in three

months. Of the total rice stocks in April, about 63.04 percent were from the households, 36.39 percent were held by commercial warehouses and 0.56 percent was in NFA depositories, according to the PSA. The total volume of rice held by households during the period reached 1.376 MMT, while those in commercial warehouses amounted to 794,380 MT. The NFA’s rice stockpile as of April 1 plunged to 12,240 MT, the lowest in 38 years. The bulk of the staterun grains agency’s buffer stock, or 79.69 percent, were comprised of imported rice.

“Comparisons with last year’s rice stock levels showed a decrease

of 4.50 percent in the households, 12.45 percent in commercial warehouses and 96.26 percent in NFA depositories,” the PSA said in its monthly report, titled “Rice and Corn Stocks Inventory,” published on Thursday.

“Relative to last month’s record, both stocks inventory level in households and in commercial warehouses grew by 25.04 percent and 43.56 percent, respectively. Meanwhile, a drop in stocks level was observed in NFA depositories by 71.89 percent,” the PSA added. The government periodically monitors rice inventory to determine whether it would need to import the staple to boost local stocks.

Govt to help 6 Batanes municipalities construct ice-making plants

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he Department of Agriculture (DA) has vowed to assist six municipalities in Batanes to construct ice-making plants, which would benefit local fishermen in the province.

In a statement, Agriculture Secretary Emmanuel F. Piñol said he has committed to provide the six municipalities credit assistance under the Agricultural Credit Policy Council.

“The loan is payable in eight years with only a 2-percent interest per annum,” Piñol said.

According to the DA chief, the ice plants will run using solar-powered generators, which are comparatively more modern than existing facilities.

In his message, Piñol urged the local chief executives to establish a food consolidation area.

“This will complement to the

presence of food boat that will roam around the country by next year to collect the produce of farmers and fishermen in far provinces to bring to Metropolis area,” he said.

In line with this, Piñol directed Agriculture Undersecretary for Fisheries Eduardo B. Gongona to coordinate with the Navotas shipping company to help design an 80-foot and a 50-foot food boats, which will

sail next year.

While in Batanes, the DA chief turned over 100 units of boat-making materials, at P300,000 per boat, to the provincial government.

“We will provide the materials to the fishermen, and we will let them design their own boats based on the climatic requirement of your area,” Piñol said.

To date, Batanes fishers have al-

ready completed the construction of 23 units of fiberglass boats.

On top of these, Piñol vowed to assist in the construction and repair of the fishing port of Batanes and directed the Bureau of Fisheries and Aquatic Resources to assign MCS 3010 to serve as patrol boat, which will cover marine areas from the Philippine Rise to West Philippine Sea.

China food giant is said to expand in Brazil amid US tensions

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hina’s food giant Cofco International is positioning itself to increase soybean purchases from Brazil as trade tensions escalate between the United States and the Asian nation, according to a person with direct knowledge of the matter.

Cofco has strengthened its team that buys, stores and sells farmer crops, known as origination, in the South American country, recently hiring as many as 12 people to work directly with farmers in Mato Grosso, Goias, Parana and Rio Grande do Sul states, said the person, who asked not to be named because the information isn’t public. Brazil is the world’s largest soybean exporter.

While China has yet to implement its planned tariffs on imports of US soybeans, the country’s traders are already canceling American shipments, according to US government figures. The data reinforced comments from the CEO of grain-trading behemoth Bunge Ltd., who said last week that China has essentially stopped buying US supplies.

China is the world’s biggest buyer of soybeans, used in everything from cooking oil to animal feed. The nation announced the planned tariffs against US shipments last month, and since then speculation has mounted that the Asian country will be become even

Dreyfus—the A, the C and the D in the so-called ABCD quartet that dominates global agricultural trade. It’s become the No. 3 exporter, trailing only Bunge , the B and Tokyo-based Marubeni Corp.

As Cofco increases its abilities to source directly from farmers, it’s also seeking to improve logistics for shipping from Brazil. The company is consolidating port operations at two neighboring terminals it currently uses in Santos Port, the largest in Latin America,

more reliant on Brazilian crops.

Most of Cofco’s new hires are experienced, having worked for rivals such as Bunge and Louis Dreyfus Co., the person said. Cofco already has a team of about 350 people within its commercial department in Brazil, including at warehouses in the countryside. A Cofco spokesman declined to comment on the company’s business development.

On its web site, Cofco says increasing its origination capabilities is key to its business strategy.

Leading exporter

While century-old traders like Bunge and Louis Dreyfus took decades to build a leading position in

Brazil’s oilseed market, Cofco has been able to attain a similar status within just the last couple of years. Shipping lineup data signal that the Chinese company in 2017 exported more than Archer-Daniels-Midland Co., Cargill Inc. and Louis

the person said. Cofco is seeking the renewal of its port concessions that are expected to expire in coming years, allowing for investment to increase export capacity, the person said.

Cofco’s expansion stands in contrast to Japanese trader Mitsui & Co., which this week said it plans to cease all operations for its grain business in Brazil by the end of December 2018 amid poor performance in the origination business.

Bloomberg News

A10 Friday, May 11, 2018 • Editor: Angel R. Calso

Opinion BusinessMirror

www.businessmirror.com.ph

editorial

Vietnam loses its ‘war’ against China

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lmost completely ignored by the local press and media and, of course, by the critics of the Duterte administration’s foreign policy regarding the South China Sea, Vietnam recently capitulated to China’s exclusive economic zone claims.

In March Vietnam’s state petroleum firm PetroVietnam withdrew its consent for Spanish energy firm Repsol to move ahead with a drilling project in the “Red Emperor” block off Vietnam’s southeastern coast. This was to be a $200-million oil and gas development project that has been in the works since 2009. Reports say that in July 2017, the Vietnamese military took a strong stance against the project with fears that China would escalate the situation as it has since 2014.

Also last July executives from Repsol said that China threatened to initiate a military conflict with Vietnam if the Spanish firm moved ahead with its planned drilling activities. From thediplomat.com: “The Vietnamese decision was not made freely by the government. For months China has been working to coerce the government of Vietnam and deprive it of the right to freely exploit its exclusive economic zone as should be its right under international law. The development underlines the ultimately shallow assurances the United States has been able to provide to regional states.”

Summing up the situation clearly—and for those who prefer a stronger response by the Philippine government—The Diplomat goes on to say, “Instead of seizing on international law, including the July 2016 arbitration award by a Hague-based tribunal in the Philippines’s 2013 case against China, Hanoi simply had to accept the reality of its poor odds of prevailing in a military conflict with China.”

Again from The Diplomat: “By failing to show up as Vietnam was coerced into a corner, Washington ultimately failed to live up to supporting the values that it claims to hold with regard to the future of the regional security architecture in Asia. The next time Chinese decision-makers seek to authorize the coercion of a Southeast Asian claimant state in the South China Sea, they’ll remember that.”

If the Philippines and others in the region cannot depend on any concrete assistance from the only country that has the power, then where do we go from here?

Those with the intellectual depth of a schoolchild would like to address this as China being a schoolyard “bully.” Nothing could be farther from the truth. This is all part of a calculated regional economic and political strategy.

And we have seen this before.

The Monroe Doctrine was a United States policy of opposing European colonialism in the hemisphere in 1823. It stated that further efforts by European nations to take control of any independent state in North or South America would be viewed as “the manifestation of an unfriendly disposition toward the United States.”

The Monroe Doctrine came to be on December 2, 1823 during President James Monroe’s annual message to Congress. “The American continents… are henceforth not to be considered as subjects for future colonization by any European powers.”

The three main concepts of the doctrine were separate spheres of influence for the Americas and Europe, non-colonization, and nonintervention creating a clear divide between the New World and Europe. The US also wanted to increase influence and trade in the region to the south.

Replace the “United States” with “China” and move the hemisphere to the other side of the world, and you have East Asia 2018. Met by the South American independent nations with suspicions, a Chilean businessman wrote to a friend: “But we have to be very careful: for the Americans of the north are only for themselves.”

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You don’t need to James Jimenez

spox

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t the risk of repeating myself—as long as I’ve been writing about these things, I suppose it is inevitable that I would go over the same ground more than once or twice—here are the things you don’t need to do on election day, May 14, 2018.

You don’t need an identification card—certainly not a voter’s ID—in order to exercise your right to vote.

The names of registered and eligible voters are contained in the List of Voters held by the Electoral Boards; if you are registered and are eligible to vote in the precinct where you’re at, the Electoral Board will recognize you and let you vote.

You don’t need to tell the Electoral Board how old you are. The List of Voters was generated from the Commission on Elections database and the database knows your age. This means that the List will contain annotations that will tell the Electoral Board how many ballots you should

be given: one Sangguniang Kabataan ballot, if you are aged 15 to 17; one SK ballot and one barangay election ballot, if you are from 18 to 30 years old; and only one Barangay ballot if you are 31 years old and up.

You don’t need to bring pens or pencils to the polling place. A pen will be provided.

You don’t actually need to take a selfie with your filled-out ballot either, as much as it feels absolutely necessary to document the experience and share it on social media.

You don’t need to bring campaign materials or election propaganda into the polling places. In fact, you shouldn’t as that would constitute

You don’t really need to vote.

It is still a free country where voting is a privilege and not an obligation, but consider this: If you don’t vote, then the next two years of your barangay life will be shaped by the decisions of people you never chose to lead you; if you don’t vote, you will have willingly surrendered power over yourself and your real family, to some people who you might not even trust. electioneering, which you can get into a lot of trouble for.

You don’t need to be irritated or annoyed or snarky if the election workers allow a senior citizen or a person with disabilities or a pregnant woman cut in front of you in the line.

Election workers have been trained to give priority access to people needing special assistance; when the day comes that you’re going to need such assistance yourself—and believe me, that day will certainly come—you will be thankful that such priority assistance is a thing. For now, don’t begrudge it to those who need it.

You don’t need to make all sorts of cutesy marks on your ballot just to emphasize your love or support for a particular candidate or group of candidates. The mere fact that you wrote their names on the ballot speaks volumes. If you really want to demonstrate your desire for these candidates to win the elections, here’s a tip: write down their full names as they appear on the Official List of Candidates attached to the ballot secrecy folder you will be allowed to use on election day. That way, you can be sure that when the ballots are counted, your votes are properly acknowledged and credited to your fam.

And lastly, let’s face it: You don’t really need to vote. It is still a free country where voting is a privilege and not an obligation, but consider this: If you don’t vote, then the next two years of your barangay life will be shaped by the decisions of people you never chose to lead you; if you don’t vote, you will have willingly surrendered power over yourself and your real family, to some people who you might not even trust; if you don’t vote, you will have epically failed to do the most needful thing you never needed to do.

Ambulance donation of PCSO, not for personal use Florante S. Solmerin

FACT IS MIGHT!

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t’s no longer new that politicians or any influential personality utilize the donated ambulances from the Philippine Charity Sweepstakes Office (PCSO) as if they own it. These ambulances are donated by PCSO for charity and for the people needing to be transported to the nearest hospital to save their lives.

The donated ambulance is to save lives, not to save one’s political career.

PCSO does not leniently donate ambulances because it must pass through a rigorous process. The process may be viewed at the Ambulance Donation Program on the official web site of PCSO (www.pcso.gov.ph).

The funds used to procure ambulances come from the earnings of the agency’s lottery games such as Small Town Lottery (STL), Lotto, Keno, Digit Games and Sweepstakes tickets. It is not taken from the tax of the people, but from the gaming public who patronize the charity games.

Before a beneficiary receives an ambulance, a local government or institution, for example, (private or public entities that work in the name of charity), said entity and PCSO are to sign a memorandum of agreement (MOA). The prohibited uses of the ambulance are stated in the MOA. In the event that the ambulance is utilized inappropriately, a thorough investigation has been performed, and if it is proven by the PCSO, the donated vehicle is immediately forfeited. Sanctions may be given to the erring beneficiary, such as the loss of opportunity to receive another am-

PCSO does not leniently donate ambulances because it must pass through a rigorous process. The funds used to procure ambulances come from the earnings of the agency’s lottery games, such as Small Town Lottery, Lotto, Keno, Digit Games and Sweepstakes tickets. It is not taken from the tax of the people, but from the gaming public who patronize the charity games.

bulance from the agency until they present an attestation that they will not violate the MOA. It is even more alarming if the donated vehicles will be used for criminal acts.

Besides personal use of the donated vehicles, it is also reported that the ambulances may be used by patients, however, they must shoulder the gasoline expenses and provide themselves a driver. If the vehicles need repairs, they must also take responsibility. If PCSO can prove that such reports are true, the agency will recall the vehicles.

I have heard similar reports

during PCSO’s previous forum (Samasamang Talakayan at Linawan— PCSO Editorial) in Lipa City, Batangas: Why are gasoline expenses and vehicle repairs not included with the grant of the ambulance?

In the MOA of the ambulance donation program, it is the beneficiary’s responsibility to care for the vehicle, ensure that it is in great condition until the end of its lifespan, and shoulder the gasoline expenses.

Said expenses should be given to the patients in need of the ambulance, which shall be used to transfer patients from the hospital to their homes or vice versa.

If you have issues regarding improper use of PCSO’s donated vehicles, you may message the number provided below and send a detailed report: 09985934759. If you have evidence such as videos or photos of the improper use of PCSO-donated vehicles, you may send it to Mandirigma Kawanggawa (Facebook Page’s Messenger) and the inbox of Mandirigma sa Kawanggawa (Facebook Community Page), the two official social-media pages of PCSO General Manager Alexander F. Balutan.

E-mail: fetad@yahoo.com

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‘Ang Radyo ng Simbahan’ Sensing cultures as a tool for truth and new evangelization Tito Genova Valiente annotations

Rev. Fr. Antonio Cecilio T. Pascual

SERVANT LEADER

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S Radio Veritas intensifies its mission in evangelizing the Catholic faithful, we are also strengthening and deepening the value of truth about the Word of the Almighty Father.

This is in accordance to what the Holy Father Pope Francis stated, that “the truth will set you free” (John 8:32).

It is undeniable that we are on a midst of trial about knowing what is true due to the fact that fake news are rapidly spreading, especially in the mainstream media. People who spread falsified information, whom we called as “trolls,” are continuously using the Internet as their platform of shading out the truth.

Due to that reason, it is therefore paramount that we must move fast to fight and stop fake news to spread. It is now our time to “stand firm with the belt of truth buckled around our waist, and with the breastplate of righteousness in place” (Ephesians 6:14).

Recognizing the value of truth in our lives, we in Radio Veritas would like to highlight the message of the Holy Father for the upcoming 52nd World Communication Sunday, with the theme “The truth will set you free [John 8:32]: Fake news and journalism for peace” that will be held on May 13.

Together with the Holy Father, we would like to take this as an opportunity to contribute in fighting fake news by promoting the value of truth.

As a station that promotes truth through “Ang Radyo ng Simbahan,” we are calling all the Catholic faithful to be vigilant and

become a watchdog of our society by supporting and joining the 52nd World Communication Sunday by means of your kind donations that could help in its day-to-day operations in bringing the Gospel Truth in its media broadcast.

For your possible support, kindly call Ms. Audrey Elli at 410-6370; 0915-5222021 or 0922-8591763; or Mr. Dene Mondoñedo at 9257-931 local 130 or 0915-3391206.

My dear brothers and sisters in Christ, let us all be united with the Holy Father Pope Francis in preserving the value of truth and be responsible in “searching for truth and our pursuit of goodness.” It is now our time to fight for the truth and stand for our rights to know the truth as we have been chosen

by God to “give birth through the word of truth, that we might be a kind of first fruits of all He created” (James 1:18).

To know more about Caritas Manila, visit or follow us on Facebook: CaritasManilaInc. For your donations, please call our DonorCare lines 563-9311, 564-0205, 0999-7943455, 0905-4285001 and 0929-8343857. Make it a habit to listen to Radio Veritas 846 in the AM band, or through live streaming at www.veritas846.ph and follow its Twitter and Instragram accounts @veritasph and YouTube at veritas846.ph. For comments, e-mail veritas846pr@gmail.com.

Korean and Iran nuclear talks: A study in contrasts Edgardo J. Angara

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he Korean negotiation produced an initial breakthrough agreement. Asians usually carry on a dialogue through symbolism without having to verbalize. The Asian way is called a Dialogue of Silence.

West diplomats inevitably often strongly articulate their viewpoint.

The West way leads often to stalemate, needing a third-party arbiter to break the deadlock or resolve the dispute.

This contrast to me explains the initial success of the Korean Peninsula dialogue and the apparent lack of progress of the European Union (EU) trying to convince Trump not to disown the Iran denuclearization accord.

Prof. Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy-National University of Singapore said: “Scholarship in the West often overlooks the personal dimension in international relations.”

How did the Chinese react to the Korean talks. Its Prime Minister traveled to Seoul to congratulate South Korea President Moon Jaein for breaking the deadlock. Its foreign minister traveled to Pyongyang to tell Kim Jong Un that China supports full denuclearization of the Korean Peninsula.

On the other hand, under the Iran denuclearization deal from which the United States has pulled out, Iran said it’s free to return to the status quo ante, i.e., uranium en-

richment, rearming its ballistic missiles, resumption of nuclearization program.

The EU dispatched French Prime Minister Emmanuel Macron and German Chancellor Angela Merkel to Washington to convince President Donald Trump not to scrap the Iran accord.

Frenchman Macron in Washington used cultural diplomacy— its historic affinity to the US to charm President Trump. German Chancellor Merkel displayed the equally well-known Teutonic efficiency: direct to the point and no kisses and embraces. From the airport, she was whisked to the White House and after a quick day visit again brought back to the airport and on to Berlin.

Is the contrast in negotiation partly explained by the fact that Asian civilizations were as old as the Greeks and Romans, and the Maya’s in Yucatan; and Guatamela in Central America? Their ancestors had learned the art of employing “soft power” to maintain stability and diversity within their empires.

E-mail: angara.ed@gmail.com| Facebook and Twitter: @edangara

The writing of cultural descriptions is properly experimental and ethical.

The constructed artificial nature of cultural accounts….

Historical predicament of ethnography, that it is caught up in the invention, and not the representation of cultures.

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S I write this, I am caught between remembering the opening of the Heritage Month in Davao and preparing to read a paper on the predicaments and possibilities of contemporary Philippine studies in the Ateneo de Manila University. In the first, there is certainty in what constitutes Filipino culture and the call is to celebrate it, to remember; in the second, the urgent attention is to raise questions about cultures.

The certainty in Davao is supported by a government—as with the other governments—expressing belief in the power of culture and bringing them down from the air to the plains of legacy and heritage, in fact to a room where “experts” could talk about the importance of culture.

That, indeed, if we need a month to remind ourselves of this need to celebrate national heritage, it is because it is clear to us that we are a nation, and we have heritage to share and, to use that cliché, hand down to the next generation. The assumption, of course, is that the next generation will need that heritage and that they deserve that. The assumption also is that there is clearly a heritage and we know how to present that.

The gathering on May 11 and 12, in Ateneo de Manila, which is a two-day conference-workshop, “seeks to reflect on the question of the ‘Filipino.’

As with many academic endeavors, the purpose of these scholars is not really to come up with answers but with questions. We, academics, if you care to know, are anxious about giving answers. The fashionable thing to do is to posit queries and present positions. Contrary to being prescriptive, academics generally are timid precursors of change.

Our arrogance and daring are in our bravery to ask, to ponder and not be afraid to be ponderous.

If conferences are drinking parties, then on those two days, you could listen to old “jokes.” These are concepts that have been bothering particular scholars. Give them a forum and they will take those concepts out of the dustbins of disbelief and air them out. Woe to the listeners who have listened to the same cultural laments for he or she will once more confront the same questions that are expected to trigger interest in possible answers. This is not bad per se; this means the good scholars continue to allow some thoughts chance to germinate, to assume solidity.

What shall I do on my day? I am

tired of reading papers. One of the convenors of the conference, Dr. Jayson P. Jacobo, a literary scholar and critic, assured me there was no need to have PowerPoint presentation. Thank God for enlightenment.

What he oriented (“orientation” is such a loaded term, the word’s etymology coming from an old French work, which means to face East— and East is where we are, from the prepositioning of the West) me was that I could have a conversation. I could talk about my continuing research projects, which could mean my unceasing obsession with cultures.

On that day, therefore I shall share with my audience my efforts to make sense of cultures—Bicol Culture in my capacity of being a Bikolano researcher and cultural worker; Filipino culture in my work as art and media critic compelled to write about the central rather than the marginal; and my persistent interest in the power of anything in the guise of the global to blur boundaries and markers.

The conference will allow me to further my research on our almost infantile desire to claim originality by abusing certain aspects of cultures in our nation. The many ethnolinguistic communities are our victims when we start feeling small that we

Friday, May 11, 2018 A11

do not have something we can call “original” Filipino. In cultural programs, we dance the dance of the “natives” to pursue authenticity. If we can secure the services of the Aeta, then that makes us giddy with our proximity to the authentic. We ran after the indigene, forgetting that we are all indigenous.

My passion for popular culture has afforded me rediscoveries of artefacts that, singled out, reveal why this need to go back to the origin can be fatal. So, we have music. Melodies have defined generations and histories for us. But what happens when our beloved kundiman is discovered to be originally a Tango music? Is the value of that song diminished?

In the realm of popular music, where history and its blurring mechanism has the least power to intervene in what is “at-the-moment” happening, I will convey my ongoing fascination of songs that find themselves translated/appropriated/distorted/transported onto another location. The result of this process is the overwhelming nausea that, perhaps, we do not have really our kind of music, our own culture.

Take the case of the Samar-Leyte song, “Lawiswis Kawayan.” Its versions have grown through the years, with that of the Mabuhay Singers’ becoming the dominant one. In its Tagalog incarnation, the song is turned into a lambingan/tampuhan (literally “making tender gestures” and “sweetly sulking”) scenes where a man asks the woman to go somewhere, with the woman casting doubt on the purity of the man’s intention, and the man apologizing for his indiscretion. In the Samar-Leyte versions—for there are many—the song has other characters. There is the “bird” with no manners. There is also Manong Palabyo who sells eggplants and who has a “secret.”

Then there is Inday whose room is violated by the ill-mannered “Pikoy” or parrot.

I will talk about the songs that we claim to be ours but originally were in Japanese. The journey of these songs from an aesthetic point of view reveal not so much the Japanese elan

(for that is theirs) but the Filipino (translators, in this situation) and their penchant for the maudlin, the simplistic.

Take the case of Eddie Peregrina’s “Memories of Our Dreams” (“hold me close and never say good-bye/I will love you and without you I will die”). This song defined the masses of the mid-1960s and 1970s. Whenever TV shows memorialize those periods, this song is abused for reference. The song, however, is an adaptation of the Japanese “Yume wa yoru hiraku,” which means “my dreams open/bloom at night.” The song is dark and edgy. And we are dark and edgy for not acknowledging our source.

Take the case of Sharon Cuneta’s monster hit, “Itanggi Mo” (literally “Deny It’). In its Tagalog form, the song is reduced to a senselessly vapid sulking. Its original, “Koibito yo” (“Lover”), is poetry with lines that plea: Please laugh and tell me your farewell is a joke. It talks of a bench now rotten because of the rain and there, no one sits to sing a song…. The lover continues: A man is running on the gravel road, he makes me stand still as if he wants me to forget.” Kisetsu wa megutti kuro kedo… The seasons come and go but they come back again.

But I will not merely judge these adaptations and translations. We will learn from these travels that artefacts are made to undergo. Perhaps, our love songs cannot be dreary. Perhaps, the people in the urban center are not ready for folksongs that hide issues of incest and about faiths that have remained gloriously pagan even after long years of religious colonization.

As we are academics, I shall borrow from the introduction of the book edited by James Clifford and, which says that ethnography, that seemingly complete description of cultures, has a “historical predicament” because it is “caught up in the invention and not the representation of culture.”

Those lines are my starting points, my excuse.

E-mail: titovaliente@yahoo.com.

Asean and European Union: Determined to bolster together deeper connectivity

By Henrik Hololei

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or the European Union (EU), a close and deep partnership with Asean members is of high importance. Our relationship is welldefined already by the fact that the European Union is the first investor and second-largest trading partner of the Asean. It is, therefore, no surprise that both sides are also working hard to increase transport links and overall “connectivity.” Indeed, effective transport networks represent the vital arteries through which our people and businesses may flourish.

Connectivity is a key element in further deepening our relationship and creating a lot of new opportunities for both parties.

On May 9 (Europe Day!) I have the honor of cochairing the second Asean-EU Transport dialogue in Phuket. Why is this dialogue important? Quite simply because both sides wish to deepen the transport relations by land, by air and by sea

so that those arteries can ensure an even stronger pulse and push of economic activity. We are already making great strides forward. We are currently negotiating a Comprehensive Air Transport Agreement, which will represent the very first block-to-block accord and contribute substantially to further deepening our aviation links. Until now, all such agreements have led to “win-win” outcomes increasing substantially business and tourist exchanges, as well as connectivity between key partners. Leading airlines between Southeast Asia and Europe are certainly well placed to benefit from this agreement. We are also increasing our cooperation on aviation, maritime and road safety while showing leadership in international fora on cutting transport emissions.

Through a €200-million cooperation budget, the EU is an engaged supporter of Asean’s Master Plan on Connectivity 2025. In addition, the EU is developing a strategy of EU-

Asia Connectivity in which Asean will play of course a key role. This is crucial, too. While some have started to question globalization and are retreating into economic nationalism, it is important that we seek to bolster global links, make them work for all and show their true value. On connectivity, we must embrace “inclusiveness” to ensure that all countries benefit. Second— “respecting the rules,” such as transparency and a level playing field for all economic actors is fundamental.

Finally, we all live on and must share this planet. Environmental, social and financial “sustainability” is therefore a must if our people are to continue to embrace increased openness and cooperation.

Finally, transport is destined to be revolutionized more in the next 10 years than in the last 50. And the lifeblood of this transformation is digitalization. Working closely together, supporting innovation while providing a positive regulatory background,

Asean and the EU can provide leadership in order to successfully address challenges to ensure we all benefit from the new technological wizardry.

One of the great positive “disruptors” of the last century was Henry Ford.

He famously said, “Coming together is a beginning; keeping together is progress; working together is success.” Concerning the “beginning,” last year the EU and Asean celebrated our 40-year anniversary of formal relations. Throughout this period we have certainly made much progress in our cooperation. Our Asean-EU Transport Dialogue illustrates how we are now committed to working ever more closely together. Put simply—we need global solutions to global challenges. Asean and the EU together represent natural partners that can make a very significant contribution indeed!

The writer is the director general for mobility and transport at the European Commission, European Union.