Leaders pose for a group family photo at the Asia-Pacific Economic Cooperation (Apec) summit in Manila on Thursday. (Second row, from left) Hong Kong Chief Executive Leung Chun-ying, Indonesian Vice President Jusuf Kalla, Japanese Prime Minister Shinzo Abe, South Korean President Park Geun-hye, Malaysian Prime Minister Najib Razak, Mexican President Enrique Peña Nieto, New Zealand Prime Minister John Key, Papua New Guinea Prime Minister Peter O’Neill, Russian Prime Minister Dmitry Medvedev and Singaporean Prime Minister Lee Hsien Loong; (front row, from left) Chilean President Michelle Bachelet, Canadian Prime Minister Justin Trudeau, Brunei Darussalam Sultan Hassanal Bolkiah, Australian Prime Minister Malcolm Turnbull, Chinese President Xi Jinping, President Aquino, Peruvian President Ollanta Humala, Vietnamese President Truong Tan Sang, US President Barack Obama, Thai Prime Minister Prayut Chan-o-cha and Taiwanese envoy Vincent Siew. AP/Bullit Marquez
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Apec leaders adopt action agenda to globalize MSMEs ‘URGENT NEED FOR INCREASED T COOPERATION AGAINST TERRORISM’
INSIDE
By Butch Fernandez
JAMES McAVOY IN THE EXTREME
life
he leaders of the 21 membereconomies of the Asia-Pacific Economic Cooperation (Apec) adopted an action agenda to facilitate the participation of micro, small and medium enterprises (MSMEs) in global trade.
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Dubbed as the Boracay Action Agenda to Globalize MSMEs, the initiative was led by the Philippines and was endorsed by Apec senior officials at the recent Concluding Senior
Officials’ Meeting held in Pasay City. Leaders concluded their meeting in Manila on Thursday by issuing the 23rd Apec Economic Leaders’ Continued on A2
VAT hike to augment revenue losses from income-tax cut–Pids By Cai U. Ordinario
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he tax on the sale of services or goods needs to rise by a percentage point for each P25-billion proposed reduction in income tax, according to the Philippine Institute for Development Studies (PIDS), a governmentowned think tank. PIDS senior research fellow Rosario G. Manasan emphasized this point in a study titled “Comparative Assessment of Various Proposals to Amend the Personal Income Tax.” Manasan sa id aug menting
PESO exchange rates n US 47.0320
government revenues is necessary, because of the financing needed to improve infrastructure and achieve the Sustainable Development Goals (SDGs). “The need for more high-quality infrastructure services to sustain the growth momentum and the need to improve access to betterquality basic social services given the government’s mantra of inclusive growth and the thrusts of the newly minted SDGs necessarily expand the country’s financing requirements,” Manasan said.
Chinese President Xi Jinping at the Apec CEO Summit 2015 held in Makati City on Wednesday. Stephanie Tumampos
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sia-Pacific leaders called on Thursday for increased international cooperation in the fight against terrorism, as they held annual talks overshadowed by the Paris attacks. A copy of the declaration that the leaders will issue following their talks, seen by the Associated Press, strongly condemned “all acts, methods and practices of terrorism.” The statement on terrorism, which also mentions attacks in Beirut and the bombing of a Russian airliner over Sinai, is a rare departure from convention for the
Asia-Pacific Economic Cooperation (Apec) forum, which normally focuses on trade and business issues. The Apec bloc accounts for about 60 percent of the global economy. It groups the United States and China with middle powers, such as Australia, as well as developing nations in Asia and South America. The leaders said they are stressing the “urgent need for increased international cooperation and solidarity in the fight against terrorism.” See “Increased cooperation,” A8
See “VAT,” A2
n japan 0.3835 n UK 71.6438 n HK 6.0679 n CHINA 7.3787 n singapore 33.0327 n australia 33.4771 n EU 50.5688 n SAUDI arabia 12.5416
Source: BSP (16 November 2015)
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VAT. . .
Continued from A1
Manasan explained that since VAT is a consumption tax, it taxes even nonwageincome earners such as the self-employed or those that generate income through the practice of a profession. Manasan estimated the effective personal income-tax rate on wage income was significantly higher at 5.3 percent, compared to the effective personal income-tax rate on selfemployed and professionals at 1.5 percent using 2014 data. Manasan’s data showed the effective tax rate of the self-employed and professionals have been consistent at 1.5 since 2012, whereas the effective tax rate for wage earners has been increasing to 4.9 percent in 2012, 5 percent in 2013, and 5.3 percent in 2014 from 4.7 percent in 2011. “This advantage is important, considering the large difference in the effective personal income-tax rate on wage vis nonwage income and the implied greater evasion in the nonwage income sector,” Manasan said. There are currently six proposals from both houses of Congress, as well as the private sector through the Tax Management Association of the Philippines (TMAP). The income tax bills at the Senate are Senate Bill (SB) 716 by Sen. Ralph G. Recto; SB 1942 by Sen. Bam Aquino; and SB 2149 by Sen. Juan Edgardo M. Angara. Manasan estimated that SB 716, or the Recto bill, should result in a revenue loss of P54 billion, or 0.4 percent of GDP in 2014. “[This is] roughly equal to the incremental revenues from the amendment of the excise tax on alcohol and tobacco products,” Manasan said. The estimated revenue loss arising from the implementation of SB 1942, or the Aquino bill, total P71 billion or 0.6 percent of GDP in 2014. Manasan said, however, that implementing SB 2149, or the Angara bill, should result in a small revenue gain worth P10.43 billion, or 0.08 percent of GDP during the first year of its implementation. This was because the bill imposes a higher effective tax on tax-
payers whose taxable income fall within the P70,000 to P180,000 range. Pursuing the Angara bill, meanwhile, should result in estimated revenue loss of P19.7 billion in the second year and P61.47 billion in the third year. On the other hand, there are two such bills at the House of Representatives: House Bill (HB) 4829 by Rep. Romero S. Quimbo of Marikina City and HB 5401 by Rep. Neri Colmenares and Rep. Carlos Isagani Zarate of Bayan Muna. The revenue loss under HB 4829, or the Quimbo bill, was estimated to equal P131 billion or a percent of GDP in 2014. Implementing HB 5401, or the Colmenares-Zarate bill, should result in revenue loss of P232.12 billion, or 1.84 percent of GDP. The private sector proposal through the TMAP, meanwhile, should result in a revenue loss of P223 billion, or 1.76 percent of GDP in 2014. “The estimated revenue losses arising from the TMAP proposal and HB 5401 are, respectively, roughly equal to 83 percent and 86 percent of actual BIR [Bureau of Internal Revenue] collection from the personal income tax in 2014,” Manasan said. “It is notable that under the TMAP proposal only taxpayers in the ninth and 10th decile will actually be subjected to the personal income tax ,while under HB 5401 only taxpayers in the 10th decile will actually be subjected to the personal income tax,” she added. Apart from the VAT, Manasan said the proposal of the Department of Finance to amend the bank-secrecy law should help enable the BIR to catch tax cheats. Another way to offset the projected revenue loss from proposals to amend the personal income tax is to increase the excise tax on petroleum products. Other possibilities, Manasan said, include an increase in the road user’s tax or the motor vehicle user charge. These two measures were also expected to have a positive impact on the environment through reduced pollution and congestion.
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Apec leaders adopt action agenda to globalize MSMEs Continued from A1
Meeting Declaration. “We underscore the significance of the participation of MSMEs in global commerce to inclusive growth and will take action to facilitate such participation,” the declaration read. “We adopt the Boracay Action Agenda to Globalize MSMEs and instruct Ministers to implement actions laid out in the Agenda and report their progress to us by 2020,” it added. Leaders said the cost of doing business as well as cumbersome rules and regulations are barriers to “internationalization” and integration of MSMEs into global value chains. MSMEs must be assisted, they said, as these enterprises can make substantial contributions to poverty reduction through employment creation, productivity improvements and economies of scale. “We welcome the Apec Iloilo Initiative: Growing Global MSMEs for Inclusive Development, and support the creation of the Apec MSME Marketplace to provide opportunities for business and strengthen collaboration with public and private organizations to support MSME development,” the declaration read. To improve MSMEs’ access to financing, leaders backed the Cebu Action Plan (CAP), saying the Financial Infrastructure Development Network under the CAP. Leaders also reiterated their commitment to achieve the Bogor Goals of free and open trade and investment by 2020 and to the eventual realization of the Beijing-led Free Trade Area of the Asia Pacific (FTAAP). “We reiterate our belief that the FTAAP should be pursued as a comprehensive freetrade agreement by building on ongoing regional undertakings. We also reaffirm our vision contained in the pathways to FTAAP
that it should be high quality and incorporate and address next generation trade and investment issues,” the declaration read. “In this connection, we note the recent development on the free-trade agreements in the region and the progress of the possible pathways to the FTAAP, including the finalization of Trans-Pacific Partnership negotiations, and we encourage the early completion of negotiations for Regional Comprehensive Economic Partnership,” it added. While Asia-Pacific economies are keen on pursuing regional integration, leaders said they remain supportive of the multilateral trading system. Leaders urged countries to sign the World Trade Organization’s (WTO) Trade Facilitation Agreement (TFA) before the WTO’s 10th Ministerial Meeting in Nairobi next month. “The early entry into force of the WTO’s TFA , which was approved as part of the 2013 Bali Package achieved at the ninth WTO Ministerial Conference, would make a significant contribution to the sustainability of global trade and highlight the value of the WTO to its stakeholders around the world,” the declaration read. Aside from the Boracay Action Agenda, leaders also adopted the Apec Strategy for Strengthening Quality Growth that will “prioritize institution-building, social cohesion and environmental impact to pursue quality growth.” “We instruct the senior officials to commission the Policy Support Unit in 2020 on the impact of the extensive Apec work program on improving growth and to report to Leaders, for their review, on Apec’s progress in promoting the strategy,” they said. Because the region is in the Pacific Ring of
Fire and is vulnerable and exposed to disasters, leaders adopted the Apec Disaster Risk Reduction (DRR) Framework. Through the DRR Framework, Apec seeks to minimize losses and ensure that communities have the support to overcome adversity and to build back better. “We instruct Ministers to craft an action plan in 2016 to operationalize the DRR Framework,” the declaration read. Leaders also approved the Apec Services Cooperation Framework which calls for the development of a Services Competitiveness Roadmap in 2016 and the adoption of a set of actions and mutually agreed targets to be achieved by 2025. To ensure food security in the region, leaders approved the implementation of the Apec High-Level Policy Dialogue on Food Security and Blue Economy Plan of Action. The plan calls for measure to enhance the resilience of oceans and coastal resources, reduce fish loss and encourage agribusiness development. “We support the Apec Food Safety Cooperation Forum and its Partnership Training Institute Network. We encourage progress on the Apec Food Security Roadmap toward 2020, to contribute to the achievement of Apec’s food security goal,” the declaration read. Reading a prepared statement at the end of the Manila Forum, President Aquino thanked his fellow Apec Leaders “for their collaborative efforts and positive spirit as we worked together towards the goals that we share, and our cooperation gives us optimism that we can achieve greater progress sooner rather than later.” Peru will chair Apec throughout 2016 and will host the 24th Apec Economic Leaders’ Meeting. With a report from Catherine N. Pillas
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Editor: Dionisio L. Pelayo • Friday, November 20, 2015 A3
Chinese coast guard ship invades Kalayaan Island
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By Rene Acosta
CHINESE coast guard ship entered the country’s territory in the West Philippine Sea (South China Sea), and stayed there for more than one week, but the military claims it has no knowledge of the presence of the ship.
Lone casualty
A policeman grimaces in pain, after he was sandwiched between protesters and a police barricade. Several groups have been protesting every day, in time with the Asia-Pacific Economic Cooperation Leaders’ Summit. NONIE REYES
Obama told: Walk the talk in Paris climate meet
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. S . P r e s i d e nt B a r a c k Obama’s speech at the Asia-Pacific Economic Cooperation (Apec) CEO Summit on Wednesday drew various reactions from various environmental and climate activists. They say Obama’s speech, which underscored the need to act now to prevent the worst effects of climate change “before it is too late,” is much welcome but it will be much better if he walks the talk in the coming meeting on climate change in Paris, France, next month. “We welcome these positive pronouncements of putting the climate agenda at the fore in the Asia-Pacific Economic Cooperation forum, specially coming from the No. 1 historical emitter and the main culprit of global warming among industrial countries globally,” said Gerry Arances of the Philippine Movement for Climate Justice (PMCJ). However, he said the US, which is historically the No. 1 polluter, and the main culprit of the climate change should lead in radi-
cally reducing their emissions beyond their commitment under its Intended Nationally Determined Contribution, as well as other responsibilities such as climate finance. Obama’s message, he said, “should also serve as a strong message to President Aquino, who also intends to attend the Paris Climate Convention, to raise the government’s ambition in terms of its contribution to the global problem starting with the rescinding of all coal projects that is forcasted to additionally emit around 60 million tons of CO2 and phasing out of coal and fossil fuel in our energy mix.” “The said new coal plants, once built, will triple the country’s overall emissions from the electric industry,” Arances said. “Obama’s climate pep talk to big business magnates in the Apec summit does not change the fact that the pledged GHG [greenhouse-gas] emissions cuts of the top 20 polluter countries by 2030 will actually result in an increase
in emissions. If Obama’s climate solution is merely a sales pitch for renewable energy on one hand, and the perpetuation of Apec’s ‘more business than usual’ economic model on the other, then the Apec is simply not making a dent into this reality of unabated climate pollution,” Clemente Bautista, national coordinator of Kalikasan PNE said for her part. Bautista said the US is historically the No. 1 polluter, while China is the current top polluter in the world, yet both have not committed to cut their annual carbon emission to significant levels. “ T heir business emissions are primarily contributing to dangerous climactic shifts. This reckless emission pathway of these polluters is leading our world to more natural catastrophes and intensifying people’s vulnerability to climate change,” Bautista added. He said the Apec-prescribed globalization policies are leading to a surge in coal power and other fossilfuel projects. Jonathan L. Mayuga
Former Palawan gov, others beat graft case over small-scale mining By Joel R. San Juan
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HE Court of Appeals (CA) has affirmed the Ombudsman’s dismissal of the graft charges filed against former Palawan Gov. Joel Reyes and several others for allowing small-scale mining activities in the province based on a revised environmentally critical areas network (Ecan) zoning map. In a 15-page decision written by Associate Justice Romeo Barza, the CA’s Special First Division held that there was no grave abuse of discretion on the part of the Ombudsman when she dismissed the complaint filed against Reyes and several other officials of the province. Aside from Reyes, also cleared by the Ombudsman were David Ponce de Leon, former Palawan vice governor; Lucena Demaala, former mayor of Narra town; Bayani Agapito, Janet Goh, Sunny Batul, Randolf Pe, Lilia Amarez, Arlie Deles, Tomas Tabinga and Eferino Genovea, members of the Narra Sanguniang Bayan; Abraham Kahlil Mitra, former Palawan Second District representative; Antonio Alvarez, former member of the Palawan Council for Sustainable Development (PCSD); Alfreddo Abueg Jr., presidential assistant for Mimaropa/PCSD member; Romero Dorado, executive director of PCSD; and Joselito Cadlaon, Ernesto Llacuna, Gil Acosta, Modesto Rodriguez, Edmundo Balerite, Derrick Pablico,
Vicky de Guzman, Alice Fabellon and Mark Dior Madamba, members of the Sangguniang Panlalawigan of Palawan. The Ombudsman, in dismissing the complaint for Violation of Section 3 (e) of Republic Act (RA) 3019 filed against the respondents, found no “manifest partiality, evident bad faith or gross inexcusable negligence” in the performance of the respondents’ official duties, “which is presumed to have been regularly performed in the absence of evidence to the contrary.” As regards to violation of Section 3 (j) of RA 3019, the Ombudsman did not find any evidence to prove the accusation of the petitioners that the respondents knowingly approved or granted any license, permit, privilege or benefit in favor of any person not qualified for or not legally entitled to such license, permit, privilege or advantages. The Ombudsman held that no evidence was presented to prove that the applicants-mining companies are not entitled to the said mining permits which were granted to them. The issuance of the permits for small-scale mining operations, according to the Ombudsman, was made in accordance with the Ecan Map and Strategic Environmental Plan for Palawan (SEP law). The CA agreed with the Ombudsman that without a judicial decision annulling the reclassification of the Ecan Map of the Municipality of Narra nor the SEP clearance issued to the applicants-mining companies,
the mining permits issued to the said mining companies remain to be “legal and regular.” “The Ombudsman’s finding of probable cause, or lack of it, is entitled to great respect absent a showing of grave abuse of discretion. Besides, to justify the issuance of the writ of certiorari on the ground of abuse of discretion, the abuse must be grave, as when the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility, and it must be so patent as to amount to an evasion of a positive duty or to a virtual refusal to perform the duty enjoined, or to act at all in contemplation of law, as to be equivalent to having acted without jurisdiction,” the CA pointed out. The case stemmed from the petition filed by members of the Environmental Legal Assistance claiming that the areas applied for SEP clearance by Patricia Louise Mining and Development Corp., Palawan Alpha Resouces Corp., San Juanico Nickel Mining Corp. and Narra Development Corp. are within areas classified as a “core zone” under the Ecan Map. They added that under RA 7611, or An Act Adopting the Strategic Environmental Plan for Palawan, mining within the core zone is strictly prohibited. Petitioners believed that respondents who are members of PCSD violated the SEP law when it issued SEP clearance to the applicants covering the areas under the core zone.
Kalayaan Mayor Eugenio B. Bito-onon Jr. said the Chinese ship arrived at the West Philippine Sea on November 9, and stayed for nine days just 4 nautical miles from Pagasa Island. “It was a Chinese coast guard vessel, a big ship with white markings. She was there observing, it was on a standby. It did not drop anchor, but was on a standby,” Bito-onon said, adding that municipal employees even took pictures of the ship. However, the Armed Forces spokesman, Col. Restituto Padilla, said the military was not aware of the presence of the ship, adding that vessels have the freedom of passage,
so long as they are in international waters. If the ships enter Philippine territory, then they need permission from the government. “Nothing is coming out from our monitoring that somebody is violating the no-sail zone and our territorial waters,” Padilla said during a media briefing on Thursday. A no-sail zone was imposed at the Manila Bay for the ongoing Asia-Pacific Economic Cooperation (Apec) summit. “No restriction is imposed for vessels of our neighboring countries if they are in international waters. It is the right of any vessel to sail through international wa-
ters or any designated passageway. But if they will enter our territory, then it is there that they would be blocked,” Padilla said. Bito-onon said the Chinese coast guard ship left at around 7 a.m., or one day after the arrival of Chinese President Xi Jinping in Manila to attend the ongoing Apec summit. It left hours before the start of the Apec Economic Leaders’ Meeting, which is not only being attended by the Chinese president but also US President Barack Obama. On Wednesday Obama called for a stop to China’s reclamation activities on the West Philippine Sea, and supported the Philippines’s effort in resolving its territorial dispute with Beijing through the ongoing proceedings of the United Nations Arbitral Tribunal. Obama made his call one day after he pledged to donate two more 48-year-old ships to the Philippines in order for its Navy to increase patrols at the territory being disputed by China. Bito-onon said the Chinese coast guard vessel shadowed Kalayaan’s municipal boat, the Queen Seagull, which delivered supplies for the town and even grocery items that were bought by the island’s residents.
Economy
A4 Friday, November 20, 2015 • Editors: Vittorio V. Vitug and Max V. de Leon
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China gets cold shoulder as Obama and Aquino tout friendship
President Aquino shares a light moment with US President Barack Obama during the Apec Leaders’ Meeting family photo at the main lobby of the Philippine International Convention Center (PICC), Cultural Center of the Philippines Complex, in Pasay City on Thursday. Malacañang Photo Bureau
President Aquino delivers his message during the Asia-Pacific Economic Cooperation (Apec) Leaders’ Meeting Welcome Dinner at the SM Mall of Asia (MOA) Arena on Wednesday. Working with this year’s theme: “Building Inclusive Economies, Building a Better World.” Malacañang Photo Bureau
By Angela Greiling Keane & Toluse Olorunnipa | Bloomberg
I
N the Philippines any meal, large or small, is seen as a joyful occasion, according to the country’s President. As he walked into dinner on Wednesday with US President Barack Obama by his side, laughing and joking, Mr. Aquino was both having fun and sending a message.
Dressed in traditional Philippine white shirts and dark trousers, Obama and President Aquino led a gaggle of 21 Asia-Pacific leaders attending their annual summit in Manila. Bringing up the tail was Chinese President Xi Jinping, who walked in with Mexico’s Enrique Peña Nieto. Mr. Aquino is hosting this year’s Asia-Pacific Economic Cooperation (Apec) forum. That has provided him the chance to display his country’s strong strategic alliance with the US, as the Philippines fends off China’s increasing assertions to the South China Sea, a key waterway claimed in part by both nations. Obama has certainly assisted: After arriving on Tuesday one of his first appointments was to tour a Philippine warship that’s a decommissioned US coast guard vessel and has been involved in a standoff with Chinese boats in the South China Sea.
Avoiding politics
president aquino told his dinner guests the meal would not include a policy discussion. “Occasions like this not only allow us to strengthen old friendships, they provide us an opportunity to make new ones,” he said. “Here in the Philippines a meal is always seen as a joyful occasion, no matter how simple the fare.” He led a toast to the future of Apec where “no one is left behind.” “When a Filipino is about to have a meal, he is always compelled to share what little food he might have with anyone around. Even if they are complete strangers,” Mr. Aquino said.
The Philippines is, however, dwarfed economically by its larger northern neighbor, and China is the largest trading partner of the 10-member Association of Southeast Asian Nations, giving it leverage in its territorial disputes with South China Sea claimant states.
Not claimants
Speaking earlier Wednesday after a meeting with President Aquino, Obama called for bold steps to lower tensions on the South China Sea. “We’re not claimants ourselves but we fully support a process in which through international laws and international norms these issues are resolved,” he said. The US backs the Philippines’s decision to try to bring China before an international arbitration court over their dispute, Obama said, before announcing the transfer of two more ships to the Philippines. China’s land-reclamation work in the waters underscores that its “military modernization is challenging decades of US- led peace and stability in the Asia-Pacific region,” a commission created by the US Congress said in its annual report. Xi, in turn, urged Apec leaders to “foster an environment of peace” in the region through dialogue and cooperation. He didn’t mention the South China Sea in his remarks to a gathering of corporate chiefs at Apec. The US has been increasingly drawn into the South China Sea tensions. Last month it sailed a warship close to a reef reclaimed by China in what the Obama administration
President Aquino poses with fellow world leaders for a family photo with spouses during the Apec Leaders’ Meeting Welcome Dinner at the Coral Way Lobby of the SM MOA Arena on Wednesday. Malacañang Photo Bureau
called a freedom-of-navigation operation. Two US B-52 bombers were challenged by Chinese air controllers on a recent flight, though the planes did not fly within 12 nautical miles of China’s artificial islands.
Black Eyed Peas
The theme of the Apec dinner was tropical, and the evening was humid enough. A band of traditional drummers played loudly as the leaders strolled along the red carpet and into the Mall of Asia arena. Later the leaders were serenaded by seven different acts, including rapper apl. de.ap, one of the Black Eyed Peas who is Filipino-American. Palm fronds and other shrubbery were placed strategically around the location. The leaders could be seen mingling, chatting and sipping wine inside the arena, which is normally used for sporting events.
President Aquino (from left) huddles with Republic of Chile President Michelle Bachelet, Independent State of Papua New Guinea Prime Minister Peter O’Neill, United Mexican States President Enrique Peña Nieto, US President Barack Obama and Canadian Prime Minister Justin Trudeau during the Apec Leaders’ Meeting Retreat 1 at the Meeting Room 1 of the PICC in Pasay City on Thursday. Malacañang Photo Bureau
Empty chair
The dining room was decked out like a black box with dark fabric on the walls and large white decorative hangings framing colored lights on the ceiling. The tables were covered in black cloths with black napkins, with centerpieces of white flowers surrounding candles. Newly elected Canadian Prime Minister Justin Trudeau—who has enjoyed rock-star coverage in the local media—took his time getting to his chair. His spot though had his name tag, with locals taking advantage of the moment, lining up to take photos in his chair.
President Aquino participates in the discussions with fellow world leaders during the Apec Leaders’ Meeting Retreat 1 at the Meeting Room 1 of the PICC on Thursday. Malacañang Photo Bureau
Filipino culture through food, songs and dance takes center stage during the Apec Leaders’ Meeting Welcome Dinner at the Coral Way Lobby of the SM MOA Arena on Wednesday. Malacañang Photo Bureau
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PSALM seeking bidders anew for decommissioned Sucat power plant
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By Lenie Lectura
he Power Sector Assets and Liabilities Management Corp. (PSALM) is again soliciting bids for the sale of the 850-megawatt (MW) decommissioned Sucat Thermal Power Plant (STPP). In a published bid invite, the state firm formally opened the second round of bidding for the sale of the structures, plant equipment, auxiliaries and accessories of the decommissioned plant in Muntinlupa City. PSALM stated that the STPP would be sold on an “as is, where is” basis. It has set on November 23 the deadline for the submission of the letter of interest day before a prebid conference on the following day. The bidding will be conducted at the PSALM office in Makati City on February 15, 2016, with the bid submission deadline set at 12 noon of the same day. “The disposal of the STPP is in support of the Department of Energy’s Natural Gas Master Plan. The disposal and site cleanup is synchronized with master plan schedule, which indicates that the STPP land should be available by mid-2018 for the construction/operation of a combined-cycle gas turbine power plant. The proceeds from this disposal activity will be used for the liquidation of financial obligations,” PSALM President and CEO Lourdes Alzona said. PSALM earlier auctioned the Sucat power facility, but later terminated the asset-purchase agreement due to breach of the standby letter of credit issued by Genetron International Marketing, which submitted the highest bid of P602 million as against two others—the Sta. Clara International Corp.’s P561 million and VPD Trading’s P482 million. There were plans raised before to restore some of the units of the decommissioned plant by way of rehabilitation. But former Energy Secretary Carlos Jericho L. Petilla said it is no longer advisable to jump-start the power facility again. Besides, it is too costly to rehabilitate than construct a new one. “That’s been flooded already and it may not be feasible to recommission it. However, if PSALM bids again it will be on the basis that the property will be used for power generation,” the former energy secretary said. Petilla meant that the land where the Sucat plant is situated could still be allocated for energy use, possibly convert the area where a gas-fed electricity generating facility can be put up to serve as anchor load for a gas pipeline traversing the routes from Batangas to Manila. The oil-fired power plant in Sucat, Muntinlupa City, was previously owned by the Manila Electric Co., and later acquired by the National Power Corp. in November 1978. It consists of Unit 1, which has a rated capacity of 150 MW; Units 2 and 3, each with 200 MW; and Unit 4, which is rated at 300 MW. The Sucat plant was formerly known as the Gardner Snyder Thermal Plant, and officially commenced commercial operations on August 1,1968, with the completion of Unit 1.
Friday, November 20, 2015 A5
Lawmaker urges private investors to pour money on power generation
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S the Philippines hosts the 2015 Asia-Pacific Economic Cooperation (Apec) summit, Sen. Grace Poe called on private power producers to invest more in the energy sector amid the increasing energy requirement of the country.
”More power producers are needed to meet the energy requirement and cut the power cost,” Poe, a presidential aspirant in 2016, said. According to the Department of Energy (DOE), the Philippines needs an additional 11,400 mega-
watts (MW) of generating capacity to meet the energy demand from 2016 to 2030. The Luzon area will have the highest additional requirement of 8,100 MW, followed by the Visayas with 1,700-MW requirement and
Luxury cruise ship MV ‘Silver Shadow’ makes unexpected port call at Subic Bay Freeport By Henry Empeño Correspondent
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UBIC BAY FREEPORT—An unexpected bonanza turned up in this free port on Thursday morning in the form of a cruise ship diverted from Manila because of the Asia-Pacific Economic Cooperation (Apec) Economic Leaders’ Meeting. MV Silver Shadow docked at Subic’s Alava Wharf at around 10 a.m., bringing to port around 700 guests and crew for a two-day visit. The Subic business community hastily put up a warm welcome for the visitors: tourism representatives gave each disembarking passenger a lei, while schoolchildren from Olongapo City dished out a native dance on the dockside. Most of the passengers immediately went on a walking tour of Subic’s central business district, unfolding tourist maps and asking locals for direction. The six-star-rated cruise ship has been in Philippine waters since November 16, visiting some of the country’s most popular island-resort destinations, but cannot dock at the Port of Manila due to a “no-sail” policy during the Apec meeting. From Coron, Palawan, the vessel directly sailed to Subic for a two-day stop before leaving for Hong Kong, its next destination. The Silver Shadow cruise was
The Silver Shadow cruise ship approaches Alava Wharf in the Subic Bay Freeport on Thursday morning.
brought to the Philippines by Sharp Travel Services Inc., a leading travel management company in the country. According to Capt. Ildefonso Gonzales, port captain and general manager of the Sharp Port Services Inc., the port of Subic was considered as its priority alternative port call since Manila South Harbor has been declared “no-sail zone” from November 17 to 20. The Silver Shadow, which was built in Italy by the Mariotti Shipyard in Genoa, is considered one of the best cruise ships in the world. Along with its sister-vessel Silver Whisper, the ship carries only up to 382 passengers, which means it provides more space per passenger than any other cruise ship. Its passenger-to-crew ratio is also high, at 1.31 to 1. Tourism officials here said the arrival of the ship would be great opportunity for Subic not only in terms of income to business establishments, but more so in promotion by word of mouth among tourists. Subic has been getting more ship calls lately, but most of them were commercia l vessels and military ships. The last time that Subic welcomed a cruise ship was in 2005, when Queen Elizabeth II arrived with some 2,000 passengers, mostly American and British retirees.
SBMA Photo
Mindanao with 1,600 MW. Poe noted that some 15 million Filipinos still have no access to electricity, adding that the entry of more power producers would not only provide much-needed power supply but also boost competition and reduce the cost of electricity. “We want to make sure that we can do something to resolve this increasing power rate,” Poe said. The Manila Electric Co., the largest electric distributor in the Philippines, charges P12.4877 per kilowatt-hour as of October 2015. It has announced an increase of 13 cents per kWh effective this month. The Philippines has one of the highest electricity rates in Asia. According to the Philippine Statistics Authority, electricity accounted for 4.5 percent of a Filipino
household’s expenditures in 2012. “The government should provide an environment that encourages private sector participation in providing basic needs,” Poe said. The senator pointed out that regulatory and documentary requirements, including permits and licenses from local government units, are a barrier to the entry of new generating capacity in the market. “It takes 112 documents from 37 different agencies to set up a power plant,” Poe said. If she wins, Poe said, the government will issue a joint memorandum between the DOE and the Department of the Interior and Local Government to streamline permits and licensing of new generation projects. A one-stop shop within the DOE
will also be set up to facilitate the process of doing business in the energy sector, especially those involving renewable energy (RE). The power plants operating in the Philippines have a total capacity of 17,944 MW. The non-RE sources account for 67 percent of the installed capacity, while RE sources account for 33 percent, according to the DOE. The Philippines’s power consumption has tripled from 26,579 gigawatt-hours (GWh) in 1993 to 77,261 GWh in 2014. Under the Electric Power Industry Reform Act of 2001, generation and distribution of energy resources are privatized. Transmission, however, is government-owned but privately operated by the National Grid Corp. of the Philippines. PNA
A6 Friday, November 20, 2015 • Editor: Angel R. Calso
Opinion BusinessMirror
editorial
Why Apec 2015 is good for the PHL
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N spite of a constant stream of complaints from the horrendous traffic in Metro Manila to the cost, the 2015 Asia-Pacific Economic Cooperation (Apec) meeting was good for Filipinos if you kept your ears and eyes open. The necessary closure of roads in the metropolis shows once again how fragile our transportation system has become. Government officials concentrated on security and left commuters to fend for themselves. That was a big mistake. But the bottom line is that all the problems are the result of decades of neglect. The P10 billion spent on all the yearlong Apec meetings seems like a lot of money. The amount could fund thousands of classroom and teachers’ salaries. Or, perhaps, fill the pockets of dishonest politicians in a “pork-barrel” fraud. But, in reality, the Philippine government spends about P10 billion each and every day. There were some interesting occurrences on the sidelines of the official festivities. Addressing Filipino reporters, Melbourne, Australia Mayor Robert Keith Bennett Doyle reportedly said, “I hope my city [Melbourne] is as clean as yours.” Local reporters laughed. Whether that story is completely accurate, it will become part of the Apec 2105 narrative. The Philippines’s pride and joy, El Gamma Penumbra, performed at the Apec Economic Leaders’ Welcome Dinner. We are sure the attendees were as impressed as we all have been with this incredible Filipino talent. However, in our opinion, the “interview” by US President Barack Obama of Chinese Alibaba’s founder Jack Ma and Filipina engineer and inventor Aisa Mijeno was most revealing. Mijeno has invented an inexpensive lamp that is “powered” by salt water. Watching her speak, this lady’s passion and commitment to bettering the lives of the Philippines’s (and global) rural poor is inspiring. However, here is an official transcript of the conversation from the world’s most powerful leader and one of the world’s richest business owners. Obama: “I will say that the lamp you talked about, in addition to providing light, you can also charge a cell phone, right?” Mijeno: “Charge a phone, yes.” Obama: “And if people have these lamps, they’re more likely to charge their cell phone, which means they’re more likely to use e-commerce.” Remember that Mijeno created this product because “I did a personal immersion up in the mountains of Kalinga. I learned of a story that because of scarcity of public transportation, people had to travel down the mountain and walk six hours just to get kerosene for the lamps.” Therefore, people that are so far removed from the wealth and conveniences of modern civilization are suddenly going to be able to shop online. Obama: “And more likely to purchase things through Alibaba.” Ma: “We will sell it online.” Perhaps, this was all just ridiculous and unserious banter at an attempt to be funny. Or, perhaps, this reveals the true extent of the commitment of the rich and powerful to the underdeveloped people of the world. That interview is also part of the Apec 2015 legacy.
APEChotties James Jimenez
Y
spox
ou have to love Philippine social media. One minute, it’s rife with complaints about the inconveniences wrought by the holding of the Asia-Pacific Economic Cooperation (Apec) conference in Manila; next minute, it’s practically coming apart at the seams with excitement over the arrival of heads of states who are quickly lumped together under the hashtag APEChotties. Not that this is a uniquely Filipino phenomenon, of course. Back in May 2013, social media in Taiwan also exploded when a Filipina reporter arrived on the shores of that island state. As one paper reported it here at home: “Apparently, [the reporter] has turned into something of a celebrity in Taiwan since she arrived in the country to cover the aftermath of the fatal shooting of a Taiwanese fisherman by a Philippine Coast Guard vessel.” What’s important to note is that, in both cases, the tangential social-media reaction to the physical beauty of the participants ultimately did not affect the outcome of the events being reported. The diplomatic issues in Taiwan were definitely not untangled by the presence of a comely woman; the various inconveniences certainly have not been resolved by the rakish smile of the Canadian prime minister. Which brings me to something the chairman of the Commission on Elections (Comelec) said recently.
At a gathering in a university, Chairman J. Andres D. Bautista said social media would be a “game changer for [the] 2016 elections.” “Social media, at its best, embodies the spirit of genuine democracy,” the chairman said, “because through these online platforms, citizens can quickly gather relevant information about candidates and the government, which will allow them to hold elected officials accountable to their promises.” I agree. However, having spent some time in the trenches, I need to add the caveat that social media isn’t exactly the exclusive domain of “relevant information” anymore. Today, voters have to be very careful about the information they source from social media. Just this week, for instance, a web site that’s been getting some attention for its political content committed a faux pas when it presented as fact, information from a parody Twitter account.
The error was caught, and the web site graciously made its apologies. But imagine if it were a voter who saw that information, didn’t know it was from a parody account, then went on to exercise his right to vote on the basis of that ersatz info? That would have been a terrible waste of a vote. And then of course, there is the tendency of social media to get caught up in paroxysms of off-tangent passion. In both Apec and Taiwan, I suspect the hoopla eventually died down because the population could only do so much swooning. In the cutthroat world of politics, however, the people who release red herrings typically have much more stickto-it-iveness. Which means that disinformation can be kept going longer and with more lasting effect. Imagine a situation where someone unleashes a fake story on social media, about a candidate being disqualified by the Comelec. It’s happened before, and even without social-media, the affected candidate had a hell of a time dealing with the fallout. With social media propagating information at the speed of the Internet (which, admittedly, might be the one time people will thank the universe that we get such service), it isn’t inconceivable that the object of such an attack might simply give up. So yes, social media is a game changer. But that fact creates the burden of ensuring that the game is changed in the right way. “Turning and turning in the widening gyre, the falcon cannot hear the falconer,” Yeats wrote in The Second Coming, conjuring up visions of humanity losing control of its tools. And most grievously, Yeats
warns that in the midst of the mere anarchy that is loosed upon the world, “the best lack all conviction, while the worst are full of passionate intensity.” No one can do anything about trolls, or campaigns that deliberately use the Internet to spread disinformation, but we can do something about ourselves and the levels and nature of our own participation. Take inspiration from Wikipedia, I say. That community polices itself so fiercely that vandalism of its pages is very quickly detected and rectified. In the same way, everyone who can should also contribute to the accumulation and preservation of accurate and relevant online information. If we keep at it long enough and even half as determinedly as many Wikipedia editors do, we can actually—and organically—create a socialmedia environment where falsehoods are immediately called out and corrected, and where even the most casual user can be so protected from disinformation that he doesn’t have to think about being protected. It isn’t impossible; only, it might not happen today. After all, we’re still at that stage where we get into arguments over whether the tulip emoji is actually a rose, and where world events can momentarily be eased out of the spotlight by a good looking foreign head of state. APEChotties. Hah! I still end up reading that APE Chotties. I wonder what Chotties are. James Arthur B. Jimenez is director of the Commission on Elections’s Education and Information Department.
Opinion BusinessMirror
opinion@businessmirror.com.ph
Friday, November 20, 2015 A7
Building an inclusive economy via an inclusive financial market Ser Percival K. Peña-Reyes
EAGLE WATCH
‘B
uilding Inclusive Economies, Building a Better World” is the theme of this week’s Asia-Pacific Economic Cooperation (Apec) Economic Leaders’ Meeting. Although not as widely publicized as Apec, another significant event is actually set to happen next week, as the Bangko Sentral ng Pilipinas (BSP) will be hosting the 51st Southeast Asian Central Banks (Seacen) Governors’ Conference.
Apec was established so that there would be a forum to discuss ways to enhance the economic conditions of states. Figuring prominently on its agenda is investment creation, which is what the Philippines must accelerate to make its growth more inclusive. As for next week’s high-level meeting of central bank governors, one of the main discussion points is how central banks in Southeast Asia can support the development strategies of member-countries. This is an interesting topic, for it acknowledges the inextricable link between financial markets and the real economy. In an attempt to marry the Apec and Seacen events, this article discusses financial inclusion, particularly in the Philippine context. Financial inclusion refers to the ability of households and firms to access appropriate financial products or services. As textbook theory goes, financial markets exist to promote economic efficiency by channeling funds from people who do not have a productive use for them to those who do. In its National Strategy for Financial Inclusion, the BSP recognizes recent empirical evidence indicating that access to basic financial products and services, such as savings, payments, credit and investments, makes a substantial positive difference in people’s lives. Financial inclusion, therefore, carries the potential of improving the well-being of unserved and underserved markets, such as lowincome and marginalized sectors, small businesses, overseas Filipino workers and their beneficiaries, agriculture and agrarian-reform sectors, the youth, women, indigenous peoples and persons with disabilities, among others. Moreover, a growing body of literature suggests that greater financial inclusion contributes to financial stability and economic development, and is critical for achieving inclusive growth. The BSP also notes that an inclusive financial market is not only pro-growth but also pro-poor. Such inclusivity builds the potential to reduce income inequality and poverty, as well as to promote social cohesion and shared economic development. Financial exclusion, on the other hand, leaves the disadvantaged and low-income segments of society with no choice other than informal options, which make them vulnerable to financial distress, debt and poverty. Comparative financial-inclusion data from the World Bank Global Findex database suggest that much work needs to be done in order for the Philippines to catch up with East Asia and the Pacific, although within the lower-middle income group, the Philippines appears to perform better in more categories. Also, the SME Policy Index 2014 rates the Philippines lowest among the original Asean-5 in terms of access to finance. The index considers factors such as collateral and provisioning requirements, credit-guarantee schemes, credit bureau/registries, availability of risk capital and access to the stock market. Responding to these challenges, the BSP has identified four key
In its National Strategy for Financial Inclusion, the BSP recognizes recent empirical evidence indicating that access to basic financial products and services, such as savings, payments, credit and investments, makes a substantial positive difference in people’s lives. Financial inclusion, therefore, carries the potential of improving the well-being of unserved and underserved markets. areas in its strategic framework: 1) policy, regulation and supervision; 2) financial education and consumer protection; 3) advocacy programs; and 4) data and measurement. The fourth area actually underpins the other three, since it has a cross-cutting role in evidencebased policy-making, as well as in program development, monitoring and evaluation. Regarding advocacy programs, in particular, the Bank of the Philippine Islands (BPI) serves as a praiseworthy example of privatesector involvement. In fact, on April 29, the BPI Foundation and the Ateneo Center for Social Entrepreneurship formalized a partnership through a memoramdum of agreement signing held at the BPI Head Office. The partnership brought to life a new initiative called BPI Sinag, a business challenge that aims to capacitate and accelerate entrepreneurs through cash prizes, mentorship and access to finance. As reported in the news, over 150 social-enterprise business plans were submitted to the BPI Foundation, and 40 were chosen to go through a Social Entrepreneurship Boot Camp. The best 10 went on to participate at the BPI Sinag Pitch Day held in Makati City on October 6. The grand winner in the competition received a credit line of up to P500,000 from BPI Family Ka-Negosyo, while credit lines of up to P200,000 were also given to four awardees. Indeed, promoting inclusive growth through inclusive finance is not a task for the BSP alone. The private sector needs to be involved, and ordinary Filipinos, particularly those owning small businesses, should also do their homework. As Dr. Cielito Habito wrote in his column last year, while it’s a common lament that banks do not lend enough to small businesses despite an abundance of loanable funds in the system, one cannot fault them when small firms that seek loans are unable to demonstrate a minimum of responsible business and financial management. Targeted capacit y-building would be a worthy service that the BSP and banks themselves could provide as a direct contribution to inclusive growth. This article was written by Ser Percival K. Peña-Reyes, lecturer on Macroeconomics at the Department of Economics, Ateneo de Manila University.
Emptying the city Tito Genova Valiente
annotations
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he 17th of November 2015 should be written as the day the metropolis was emptied of people. For that was the feeling of many who walked the night of the 16th of November in our neighborhood and spoke of a quiet, lonely city, of this meeting called Asia-Pacific Economic Cooperation (Apec). The morning of the 17th I did my brisk walk, which is upon the advice of my doctor, to the old bakery at the bottom (going back home means a slow but tiring uphill walk) of the street where I live. The corner from where the eatery frequented by taxi drivers bask in the shed of huge trees was almost an empty space. No traffic there and no hotheads squinting and promising death to any one who “counterflows”. Two ladies on their way to the office talked again about how people in Manila had left the city. It is an impression—this note about how the city is now underpopulated. It seems we, Manila folks, are happy when our city is overcrowded. Remove the crowd and you sense the coming of zombies, or any group that accompanies epidemic. For several weeks now, people had been speculating about how the city will cope with presidents, prime ministers, secretaries and staff as they arrive for this thing called Apec. The
name spelled emergency situations and very few people bothered with the meaning of the acronym, after all this is a country that thrives on acronyms. This one is just another acronym, and no amount of knowing the name in full will augur prosperity. No loud opinions are heard also about the Apec meetings. Very few programs also tackle the implications, political or economic, of these series of meetings. What people recognize is the arrival of dignitaries, mark that, for the name means people with dignities. They are not ordinary people, one cab driver informed me. Another, on my way home from Saturday lectures, was proud that “tayo ang napili [we were chosen].” Indeed, the fact that this Apec is being held in the Philippines assures us that we were, indeed, chosen. We are the chosen people. But, maybe “people” is not exactly the right factor if one is struggling with this hard fact that this so-important gathering is happening in our place.
The women vote Pacita U. Juan
Women Stepping UP
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es, women comprise about 50 percent of every statistic— including voters. But what programs do candidates have for women? Besides having passed the Magna Carta for Women years ago, what laws have been passed about procurement from women-owned businesses, for example? What about recognizing some women’s inability to get full-time jobs because of home duties? Not to be partisan about it, but we need to know what all candidates have in their platforms for women and girls. There are the usual motherhood statements of solving poverty and climate change. But how about solutions for empowering more women to access public health, education and simple solutions, like giving jobs to mothers who can only work part time? Very often, candidates look for church support, because one sect or religion can have millions of followers. Another party may look at Boy Scouts and their families. Yet,
another may look at indigenous peoples and other cultural groups and get their votes. But has anyone talked about getting women’s votes? Women also influence 80 percent of purchase decisions. This is one fact many marketers miss. Including cars and hotel choices, it’s the women who vote for choice of car and lodging. No wonder smart car designers now hire women for their engineering jobs, so women’s issues can be addressed and make their car models more gender-sensitive—or women-friendly, at least. I am apolitical and have always
Tabloids have noses for odd indices about what makes a nation a habitable place to live in. Many news remind us how, during the visit of Pope Francis, a significant number of street children were treated to days of stay in resorts. Ah, I remember pretty well the Latin inscription on our shirt that served as our uniform in that hoary parochial school attached to a cathedral: Sinite parvulos venire ad me [Suffer the little children to come unto me...]. The inscription never said take the children away, even if the “away” points to resorts and fun. The world has changed, really. Go back to historical accounts and read how people, common people, turned out for the visit of popes and potentates, princes and kings, and even queens of various gender and sensitivity. But, now the opposite seems to be true. Major roads are closed to common people, for that is how we are in the scheme of Apec things. Weeks back, over the radio, a commentator was recapitulating the rules of engagement of people vis-à-vis the Apec visitors. It turned out to be a rule of disengagement. In offices that are at the route of the motorcade ushering in the important visitors, there is one rule: No opening of windows. No con fet t i s? No shout s of elation? Apparently, and the radio announcer, with a bit of disbelief in her voice, assured the listeners that this rule against the opening of windows as the parade passes by is a security precedent in other countries, in
other countries that have mastered the art of protecting their leaders, or the important people in the nation, which, of course, does not cover common people. Was it a rumor that on the 16th of November, the eve of the arrival of our distinguished guests, commuters on their way home to the Cavite area were walking on the roadside, as traffic came to a halt in that part of the city? If it was a rumor, then it was part of the impression that an apocalypse in the persona of dignitaries had befallen on our land. We have always prided on our people as our cultural capital. But the declaration of roads closed, and airports blocked, and no-fly zones could only mean one thing: We are to hide ourselves during the whole duration of this Apec meeting. The idea of clearing the streets when important people come to visit is not original to this administration or to this country. In October 2011, a month before the COP 17, the United Nations Climate Change conference, journalists talked of beggars disappearing in Durban, South Africa. Many years back, it was talked about how vagrants were kept in jail during the Cancun Summit in 1981. Our case is on a grander scale. What was that conference in the martial-law years in Manila when someone built a series of arches to hide not just a group of beggars but entire communities of informal settlers, or what we grossly term as the poor?
been. But I want to hear what the candidates have to say so my vote will not be wasted on popularity or influence of the media. What Women’s Business Council of the Philippines, Business and Professional Women and Ten Outstanding Women in the Nation’s Service did was to gather a handful of female senatoriables and a female vice-presidential candidate so we could hear them speak about their platforms and programs. For the first forum, called “Women Rising,” happening on November 25, we will invite woman candidates; in the next forum, we will invite male candidates. It would be interesting to compare and contrast their views. Do not get us wrong. We are not feminists nor activists for shallow reasons of just putting women up there where they will matter. We want, rather, to educate voters on what these women have to say. It is not just about diversity. It is about talent and leadership and integrity. It should be an interesting discussion, and these women who agreed to take part are made of good stuff. There were some who refused for
one reason or another. Or gave an excuse not to come. Maybe they are not ready to get the 50 percent of voters yet. But if you are a candidate, think about it. Women do comprise 50 percent of the voting population. And if women talk about you and include you in their lineup, she will tell one and all. Use the power of women in talking and sharing vital information. And that may be a secret you would want to know about. For my fellow woman voters, let’s think about who can make a difference in our lives. As women, and as Filipinos. It’s about time we said something, and the best way is to show them how women vote. Shall we identify the candidates who care about us?
E-mail: titovaliente@yahoo.com
Pacita “Chit” Juan is a governor of the Management Association of the Philippines, the president of Women’s Business Council of the Philippines and vice president of Business and Professional Women (Makati). She is an advocate of women empowerment through business. You can find her on LinkedIn: Pacita Juan and Twitter: @ chitjuan or e-mail puj@echostore.ph.
2nd Front Page BusinessMirror
A8 Friday, November 20, 2015
Apec business executives urged to invest in Russia
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ussian businessmen urged industry leaders in membercountries of the Asia-Pacific Economic Cooperation (Apec) to consider investing in Russia.
Kiril Dmitriev, Russia’s representative in the Apec Business Advisory Council (Abac), said potential investors could tap the Russian Direct Investment Fund (RDIF)— a $10-billion fund established to make equity investments primarily in the Russian economy. “One of the most important topics discussed at the Apec CEO Summit
were the new opportunities emerging, as the Eurasian Economic Union [EEU] integrates with the promising markets of the Apec countries,” Dmitriev said in a statement. The EEU is the economic-integration initiative of the Russian Federation, along with former Soviet Republics Kazakhstan, Belarus, Armenia and Kyrgyzstan. The
trading bloc represents a consumer population of 180 million people and a combined GDP of $4.2 trillion. Dmitriev, who is also CEO of the fund, said Russian businessmen are keen on establishing tie-ups with potential investors via the RDIF. The RDIF is a sovereign wealth fund created with the support of Russian government. Its mission is to become a catalyst for attracting direct investments, talent and technologies into the Russian economy by carrying out profitable investments. The RDIF invests, with co-investors, provided that their investment share is equal to or exceeds the fund’s share. Some businessmen from Apec countries, such as China, South
Korea, Thailand and Japan, have partnered with Russian businessmen, and have put up their counterpart investments, mostly for infrastructure projects. In terms of potential partnerships, Dmitriev said the consumer sector and the construction industry are “promising”. “Two-thirds of the global middle class will reside in the Apec region by 2030. This demonstrates the potential for the development of the consumer sector, along with industry and infrastructure construction,” he said. The Apec CEO Summit, which was held in Manila and attended by US President Barack Obama and Chinese President Xi Jinping, concluded on Wednesday. Catherine N. Pillas
www.businessmirror.com.ph
OECD COUNTRIES TO LIMIT OVERSEAS FINANCING FOR COAL POWER PLANTS
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OKYO —A compromise struck by the United States, Japan and other major nations will restrict export financing to build coal power plants overseas, but not eliminate it completely. The agreement reached earlier this week is an important step that sends a strong political message ahead of upcoming climate-change negotiations in Paris, an American official and environmentalists said. The Obama administration announced in 2013 that it would end US financing for overseas coal plants, and has been pressuring others to join. Japan was among those opposed, arguing that its high-efficiency power-plant technology is the best option for developing countries that need affordable energy. Under the agreement, which takes effect in 2017, financing would still be allowed for the most advanced “ultra-supercritical” plants, and for some other plants in poor countries. It was worked out by the Organisation for Economic Co-operation and Development, a
Paris-based group of 34 countries, including most of Europe and other key economies. “It’s been a very hard-fought compromise,” a senior Obama administration official said on a conference call. “We regard it as a major step forward coming just less than two weeks before the start of the [climate talks] in Paris on November 30.” A Japan-based network of groups fighting climate change welcomed the agreement, but said it was only a first step. “Even the highest-efficiency coal power plants emit a lot of CO2 [carbon dioxide],” said Kimiko Hirata, the international director of the Kiko Network. Officials in Australia, a major exporter of coal, were supportive. Josh Frydenberg, the minister for resources, energy and Northern Australia, said, “This agreement supports the development of new technology, while also recognizing the important role that coal will continue to play in providing affordable electricity to the world.” AP
Increased cooperation. . .
Jack Ma (from left), executive director of Alibaba Group; US President Barack Obama; and Aisa Mijeno, CEO of Sustainable Alternative Lighting, pose for photographers, after talking about climate change, the role of businesses and, most especially, Alibaba in helping the planet, and Mijeno’s invention of a lamp powered by saltwater which can also charge cell phones at the Apec CEO Summit 2015 held in Makati City on Wednesday. Stephanie Tumampos
‘Apec meetings boost PHL’s global reputation’ T
he country’s successful hosting of the Asia-Pacific Economic Cooperation (Apec) Leaders’ Meeting and the initial legal victory of an arbitration case against China over disputed territorial waters have improved in a big way Manila’s global reputation, according to a legislator. In a statement, House Deputy Minority Leader and LPG-MA Rep. Arnel Ty said the Apec summit in Manila and the positive outcome from The Hague are among the government’s best foreign policy accomplishments thus far. “Inspired by these foreign policy feats, the country is now ready to assume an even greater role in pushing for peace and security, as well as sustainable economic growth and prosperity, in the Asia-Pacific region,” he said. The Philippines received world leaders at the November 18 and 19 Apec summit, after a tribunal established by The Hague, Netherlands-based Permanent Court of Arbitration (PCA) unanimously decided it has the right to pass judgment on Manila’s historic case against Beijing over contested territorial waters. “As a result of the Philippines’s early legal gain at The Hague, other countries claiming portions of the South China Sea [West Philippine Sea], such as Indonesia and Vietnam, will likely be emboldened to
also seek international arbitration against China,” Ty added. Manila prevailed over Beijing, when a PCA tribunal, in a verdict made public on October 29, held that both the Philippines and China are parties to the United Nations Convention on the Law of the Sea, and, therefore, “bound by its provisions on the settlement of disputes.” Beijing has aggressively claimed portions of, and building artificial islands in the West Philippine Sea, and argued that the tribunal at the PCA had no right to hear Manila’s complaint. But the tribunal said it can hear the merits of the Philippines’s case against China and render a decision by 2016. The lawmaker also said the Philippines is now primed to play a more important role in regional economic development. He cited an HSBC Global Research report —“The World in 2050”—which boldly predicted “the striking rise of Philippines, which is set to become the world’s 16thlargest economy by 2050, up 27 places from today.” Ty also cited a similar report by the multinational professional services firm PricewaterhouseCoopers, which forecast that the Philippines “would emerge as the world’s 20th largest economy by 2050, passing Thailand and Malaysia, as well as Australia.” Jovee Marie N. Dela Cruz
“We will not allow terrorism to threaten the fundamental values that underpin our free and open economies,” the statement said. The mission of the 21-member Apec, convened in the Philippine capital of Manila under extremely tight security, is lowering barriers to trade and economic development. But the declaration noted the vital link between lack of economic opportunity and terrorism. “Economic growth, prosperity and opportunity are among the most powerful tools to address the root causes of terrorism and radicalization,” it said. Apec has its detractors, though, and antiglobalization protesters clashed with police near heavily guarded summit venues. Activists were chanting and waving banners as they faced off against hundreds of riot police at security barricades on the fringes of Apec venues. About 1,000 people clashed with the police, who used water cannons and canes to try and disperse the crowd. Apart from uniting against the attacks in Paris and the deepening crisis in Syria, the leaders are also seeking to promote cooperation against climate
Continued from A1
change. Disputes between China and its Southeast Asian neighbors about Beijing’s claims to most of the South China Sea also drew attention. US President Barack Obama, Chinaese President Xi Jinping and Japanese Prime Minister Shinzo Abe are in Manila for the Pacific Rim summit, as fellow United Nations Security Council members France and Russia were pursuing resolutions seeking to unite the international community in combating the Islamic State group. On Wednesday the hunt by French police for the mastermind of last week’s attacks led to a gun battle in a Paris suburb. Two people were killed and eight arrested. The first of two Apec summit retreats began onThursday with the leaders posing for a “family photo,” one of several traditions of the annual gatherings that rotate from one member to the next. The 2016 summit is planned for Peru, 2017 will be in Vietnam and Papua New Guinea will host the 2018 summit. Protest leader Renato Reyes of the left-wing alliance Bayan said the group was demanding a new economic framework that puts national interest ahead of corporate profits. AP
Apec leaders steer clear of talks on West Philippine Sea dispute
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lthough the dispute in the South China Sea was eventually discussed by individual leaders at the sidelines of the Asia-Pacific Economic Cooperation (Apec) Leaders’ Meeting, possible economic cooperation in the disputed territory, while the dispute is pending, was not discussed. Of particular importance for the Philippines is the promotion of the so-called blue economy, where the Philippines is seen to have a better chance of competing with its neighbors than in the land agricultural sector, in which the country had already lost its footing. But in the Apec ministerial meetings earlier this week, Foreign Secretary Albert F. del Rosario said there were no discussions at all about anything that has to do with the dispute in the West Philippine Sea (South China Sea). “The Apec meeting does not include any item on the South China Sea,” del Rosario said, when asked about whether the Philippines had
Del Rosario: “The Apec meeting does not include any item on the South China Sea.”
even raised the issue of small-scale fishing in the disputed territory, where reports of Filipino fishermen being harassed by Chinese gunboats are common. Chinese President Xi Jinping, who represented his country in the Apec meeting hosted in Manila, did not refer to the West Philippine Sea dispute in his speech on Wednesday. But US President Barack Obama was more blunt in saying that China should stop land reclamation, new construction and militarization in the West Philippine Sea. It appears that the Philippines
is taking a more diplomatic tact in dealing with China, and is leaving the cudgels to its military ally— the US—to make stronger statements regarding security issues arising from China’s assertiveness in the disputed territory, an observer said. The Philippines had earlier filed a case against China’s territorial claims before a United Nations arbitration court, which had assumed jurisdiction over the case, despite China’s refusal to take part in the proceedings. Chief executives of businesses based in Apec economies still consider this dispute over the West Philippine Sea between China and other Asian countries, like the Philippines, Vietnam and Taiwan, as a geopolitical risk that could affect decisions on where to make investments, according to the 2015 Apec CEO survey. But Pricewaterhouse Coopers chairman and senior partner Alexander Cabrera, which organized and conducted the Apec CEO survey
among some 800 CEOs from the 21 member-economies of Apec, said China is expected to comply with the decision of the arbitration court, even if it is against China. “As a good citizen of the United Nations and the international community, I think that China will comply with whatever the decision of the arbitration court would be,” Cabrera said. The Apec Leaders’ Meeting in Manila concluded on Thursday. While the leaders were mum on the South China Sea dispute, they “strongly condemned all acts, methods, and practices of terrorism in all their forms and manifestations.” “We stress the urgent need for increased international cooperation and solidarity in the fight against terrorism,” the declaration of Apec leaders’ read. The Philippines hosted the Apec meetings which culminated in the Economic Leaders’ Meeting which kicked off on Wednesday. David Cagahastian