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PHL defense indl zones eye global arms makers 86 C T

‘Building islands on water’ through PPPs

By Catherine N. Pillas

@c_pillas29

he Duterte administration will jump-start its program to modernize the Philippine Armed Forces by developing defense industrial complexes through the Philippine Economic Zone Authority (Peza).

According to the investment promotion agency’s new director general, Charito B. Plaza, the country’s first defense industrial estate— initiated by the previous administration—is now being built in Bataan. Once completed, it will form part of the local arms industry that

INSIDE

THE DIVINE VERA WANG The dawning of salvation

I

MPART to Your servants, we pray, O Lord, the gift of heavenly grace, that the feast of the Nativity of the Blessed Virgin may bring deeper peace to those for whom the birth of her Son was the dawning of salvation. Through our Lord Jesus Christ, Your Son, who lives and reigns with You in the unity of the Holy Spirit, one God for ever and ever. Amen. GIVE US THIS DAY, COMMITTEE ON DIVINE WORSHIP, SHARED BY LUISA M. LACSON, HFL Word&Life Publications • teacherlouie1965@yahoo.com

Editor: Gerard S. Ramos • lifestylebusinessmirror@gmail.com

Life

Monday, November 21, 2016

D1

Govt mulls future of Conditional Cash Transfer Program as poverty lingers

The divine Vera Wang TOTA PULCHRA MISS CHARLIZE

@misscharlize

‘F

VALERIE VILLAR ZAYCO MISS CHARLIZE

OR most women, a wedding gown represents far more than just a dress. It is also the embodiment of a dream, perhaps one she has nurtured since childhood. In this fantasy of idealized happiness, the groom represents perfection and the face of all human possibility. The instant a woman becomes engaged, however, all that energy and passion gets transferred to her dress. What follows can be something akin to madness,” Vera Wang writes in her book, Vera Wang Weddings, published in 2001. This sentiment still rings real and true, more so now for Filipinas who have long wanted to wed in a Vera Wang original. Their wish of doing so will now be granted as a Vera Wang store has been opened for business by Valerie Villar Zayco at the swanky 8 Rockwell Center in Makati City. “As a fashion professional and a former bride, I’m now able to translate all of that knowledge and love of style to the visual and emotional vocabulary of weddings. Having experienced weddings from both a personal and professional perspective, I can truthfully say no one is more dedicated to brides than I am,” Vera Wang continues in her book. Sharing this dedication, Valerie solidified her venture into the bridal business. “We’ve been in the bridal ready-to-wear [RTW] business for fives years, with the Rosa Clara store. So we felt that after educating the market of the perks of RTW bridal, we feel like there’s definitely an appetite for it, that brides have warmed up to the concept of RTW bridal and that we had to take it to the next level and bring them the most popular, the most renowned bridal brand in the world, which is Vera Wang,” she says. “It’s such an established bridal brand. Vera Wang is in a league of her own when it comes to bridal. Every young bridal designer aspires to be Vera Wang. We felt as though that sooner or later, the brand will come into the country, so we felt we might as well bite the bullet and do it now,” reveals Valerie, who got married in a gown of her own design. As Vera Wang writes in her book, whether a bride “is a schoolmarm or siren, flower child or princess, socialite or career girl, or a bit of each rolled into one, the bride should choose a gown that reflects who she is above and before all else. A wedding gown

must always embody the individual.” She may be a Traditionalist, Modernist, Sensualist, Individualist, Romanticist, Minimalist or Exhibitionist. “Did you meet Vera?” I asked Valerie. “No, unfortunately, but I would love to. She’s an inspiration, not just as a designer, but also as an Asian woman who has done so well on the global stage. It’s not a requirement to meet with her first before she grants the franchise. It is a franchise, but we look at it more as a partnership. So we have full support from the headquarters in New York. That’s why someone came here to support our opening. [Before the partnership was sealed] one of the heads of bridal, Erica Arkin, did come over and she took a look at the spaces we were considering for the brand,” Valerie says. “They were very open to bringing the brand to the Philippines, but what was important was that the location said a lot about the brand. Here at 8 Rockwell, there’s a sense of exclusivity, of privacy, because there are only five luxury brands in the building [Ladurée, homme et femme, Balenciaga and Lanvin].” How will this affect your other store? “Rosa Clara and Vera Wang complement each other. Rosa Clara caters to the young, modern bride. It’s also just bridal, nothing for the entourage but we also offer cocktail gowns. Looking at the prices, Rosa Clara [gowns] start at P70,000 to P160,000, most of them in the P100,000 to P120,000 range. Vera Wang [gowns] start at P200,000 to P600,000, most of them being in the P300,000 range. So, price points-wise, they’re different. And the Vera Wang bride is quite different.”

Continued on A2

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will produce weapons and equipment for the Armed Forces of the Philippines (AFP). Plaza, a decorated military officer, said other defense industrial zones will also rise in other parts of the country, where global arms and

The number of countries that buy arms and military equipment from global defense suppliers who are prospective locators in Philippine defense industrial zones

Lately, there’s been a trend toward bling-blings and Swarovskis because of the Dubai designers. But Vera Wang isn’t that. “Not at all. Vera has this kind of look, so different and so timeless. As you said, the trends of fully beaded, Swarovski-encrusted gowns—they’re trends. When you look at your gown 10 years from now, you’d actually be able to say the era. Vera Wang has that timeless feel. It’s so classic. People who got married many years ago in a Vera Wang, they can still wear the same dress today,” she assures. Valerie worked together with headquarters in choosing the gowns that will represent Vera Wang in the Philippines. “It’s very important to work with them because it’s their brand, so they’d also want a representation of the iconic Vera Wang gowns in the store. At the same time, we have the local knowledge and we know which gowns are good for the petite Filipinas, the skin tone, the color of the gowns. Weather in a way is not such a factor because we get married in air-conditioned churches and hotels. But we have those gowns for brides who want to get married in the garden or the beach, the destination weddings.” Would it be possible for a bride to have a custom-made gown made but can’t travel to New York to meet personally with Vera the designer? “I haven’t thought about that, but I think, no. All of the gowns here can be customized in a certain way.” To what extent can a gown be altered? “Well, I think you can’t necessarily say I want this top to go with this skirt. That’s too much,” she chuckles. “We have so many options that a bride may find what she’s

looking for. If it’s about lowering the neckline or the back, that’s easy. That’s fine. Or the hem. Or if they want to make it high-low. We also have a lot of coverups, belts and other accessories they can add to the dress, like the veils and all these other things to make it theirs. Seamstresses well-trained in bridalwear are on hand to do the alterations, with no extra charges.” What are the challenges of opening a store at this scale? “It was important for the company to make sure we represented their brand well. The biggest challenge was actually constructing the store to make sure that when you enter our store, it had the same feeling as when you enter the Rodeo Drive store or the Hong Kong store. The same aesthetic. The whole Vera Wang feel. It’s also important to train our people well to give excellent service because you can’t sell top-quality products then give customers low-quality service,” Valerie explains. The store has only been open for a few weeks, but it has already sold a gown. “We’ve had inquiries and we’ve taken some calls so we believe this is going to turn out well. We’re very optimistic about the Philippine market because Filipinos love weddings,” Valerie says. “When you look at it, even culturally, we love to get dressed and in an intricate way. You look at our Filipinianas, our barong Tagalogs, so as a people we love to dress up, we love to celebrate, we love to host people at home. It’s innate in us to like things that are beautiful—we have an appreciation for it. And that’s what Vera Wang offers—extremely beautiful gowns that are so well-crafted.” ■

Life

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donald trump is a mixed blessing for chinese leaders

Perspective BusinessMirror

E4 Monday, November 21, 2016

PreSiDent-eleCt Donald trump give the thumbsup as he arrives at the trump national Golf Club Bedminster clubhouse in Bedminster, new Jersey, on november 19. AP Photo/CArolyN KAster

Donald Trump is a mixed blessing for Chinese leaders

At the same time, Trump’s suggestion he might reduce Washington’s global strategic presence to focus on domestic issues would be a gift to Chinese leaders. They could expand their political and military profile in East Asia with less risk of conflict. The incoming Trump administration faces the task of maintaining influence in the face of rising Chinese strategic ambitions while accommodating Asian countries that are being drawn into Beijing’s economic orbit. That calls for more nimble diplomacy that transcends the securityfocused “pivot to Asia” and caters to countries’ desire for a balanced relationship between Washington and Beijing, analysts say. It will require greater economic and diplomatic engagement, drawing on America’s soft power assets in culture, media and education. China is, “without doubt, trying to subvert American alliances and relationships,” including in Europe, Australia and South Korea, said Michael Montesano, a research fellow at the Institute of Southeast Asian Studies in Singapore. That’s been abetted by “depressingly unimaginative” US diplomacy in Asia that is focused too narrowly on military alliances and is now hobbled by Washington’s failure to advance the TransPacific Partnership free-trade pact, Montesano said. Over US objections, Beijing has moved to cement its claim to most of the South China Sea, including by building artificial islands and

military airstrips atop coral reefs. On strategic issues, Chinese researchers have “come around to the view that Donald Trump is better for China,” said Paul Haenle, director of the CarnegieTsinghua Center at Tsinghua University in Beijing. “There is a sense among many that Donald Trump will draw inward,” Haenle said. “This is music to their ears, because this means that the United States might not put pressure on China in the region.” Beijing has been visited in recent weeks by leaders from the Philippines, Malaysia and Vietnam, highlighting its economic appeal and lack of interest in their internal affairs, especially corruption and human rights—issues the US is seen as harping on. Still, it would be “premature to write off the United States,” said Carlyle Thayer, an expert on Southeast Asia and emeritus professor at Australia’s University of New South Wales. “The US has important equities in the region through investment and trade,” Thayer said. “And the US has a national interest in preventing China from becoming a hegemonic power over the region.” As for the Philippines’s unpredictable new president, Rodrigo Duterte, the new administration would be best advised to “ride out the Duterte storm and let domestic politics in the Philippines take its course,” Thayer said. Meanwhile, concerns about China’s intentions will propel govern-

A ChineSe man holds up a Chinese newspaper with the front page photo of US President-elect Donald trump. AP Photo/Ng hAN guAN

ments, such as Singapore, Indonesia and Vietnam, toward closer ties with the US, Australia, Japan and India, said Greg Poling of the Center for Strategic and International Studies in Washington.

How will Donald Trump deal with China on politically volatile commercial issues?

DESPITE his threats of a trade war, no one is sure—probably not even Trump himself. But businesspeople and economists say Washington is bound to be tougher on trade, market access and currency after the election laid bare Americans’ anxiety about jobs and stagnant wages. Uncertainty about where Trump wants to take the world’s biggest economy has caused turmoil in global financial markets. The answer—and especially how that affects ties with No. 2 China—could have been even bigger repercussions. Trump is unlikely to carry out his most extreme threats to tear up

trade deals or slap 45-percent tariffs on Chinese goods, economists said. But they say high-visibility gestures such as declaring Beijing manipulates its exchange rate to boost exports—a step that can trigger penalties—look more likely. “It has been clear for some time that whoever wins the White House is going to be tougher on China by necessity,” said Randal Phillips, vice chairman of the American Chamber of Commerce in China. “And I think, frankly, the Chinese government has known that for several years.” Phillips and others warn that Chinese leaders will need to be sensitive to American public sentiment to avoid disrupting their access to US consumers. At the top of the US wish list is more access to China’s growing market, where finance, telecoms and a wide swath of other industries are mostly off-limits. Foreign governments assumed China would open up as it grew richer. But business groups com-

plain Beijing is trying, instead, to squeeze foreign rivals out of technology and other promising industries in violation of its freetrade commitments. The US, along with Germany and other trading partners, are increasingly frustrated that their companies are blocked from buying Chinese assets in most industries while China Inc. is on a global acquisition spree. “It’s just not acceptable anymore,” Phillips said. That could help Washington recruit allies to pressure Beijing, Haenle of the Carnegie-Tsinghua Center said. He noted Germany, the biggest economy in the 28-nation European Union, is becoming more assertive in demanding “reciprocity and market access.” Washington will talk to the EU “to see what can be done on this issue,” Haenle said. Others warn reckless action could backfire. “The biggest threats to the economy stem from Trump’s protec-

tionist stance on trade, anti-immigration policies and the weakening of government finances stemming from expected tax cuts,” Sarah Boumphrey of Euromonitor International said in a report. Trump’s election adds to the urgency of winding up negotiations begun in 2013 on a bilateral investment treaty before President Barack Obama leaves office, said Jake Parker, vice president of the US-China Business Council, which represents some 200 companies. His group sees the measure, which would guarantee the legal status of investments in each other’s markets, as the best way to increase access to the China. “This may offer an opportunity to accelerate the negotiations,” Parker said. China’s government tried to remind Washington that both sides benefit from one of the world’s biggest commercial relationships despite chronic disputes. “Bilateral trade over the past decades has tangibly benefited the US people and created jobs instead of harming their interests,” said a foreign ministry spokesman, Lu Kang. Tough talk on China has featured in every US presidential campaign since 1992, when thencandidate Bill Clinton dubbed the ruling Communist Party the “butchers of Beijing.” Once elected, Clinton set that aside and persuaded Congress to grant China low-tariff “most-favored nation” status. Other candidates have taken a similar approach. “What he said during the campaign, that’s not government policy,” said James Zimmerman, the American chamber’s chairman. “Government policy really requires thoughtful discussion, dialogue and compromise.” Companies and economists were waiting to see whether Trump follows tradition. “This scenario is still subject to considerable uncertainty,” said Boumphrey. “Republicans will control both houses [of Congress], which would ordinarily make for more certainty, but it is unclear how many of his policies the party will support.” AP

perspective

Sports

THE world No. 1 ranking is a toss-up between Novak Djokovic (left) and Andy Murray.

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| Monday, noveMber 21, 2016 mirror_sports@yahoo.com.ph Editor: Jun Lomibao Asst. Editor: Joel Orellana

SHOOTOUT IN LONDON L ONDON—Andy Murray and Novak Djokovic set up a Sunday shootout for both the Association of Tennis Professionals (ATP) finals title and the year-end No. 1 ranking. The world’s top 2 players had contrasting wins in the semifinals at O2 Arena on Saturday, with Murray surviving a match point to beat Milos Raonic, 5-7, 7-6 (5), 7-6 (9), in three hours and 38 minutes, the longest ever three-setter in the ATP finals. Djokovic needed just 66 minutes to dispatch Kei Nishikori, 6-1, 6-1. Murray arrived at the tournament simply needing to do better than Djokovic to finish the year at No. 1, a position he has held since winning the Paris Masters two weeks ago. Now, that means winning the final. “This has never happened in the history of tennis,” Djokovic said of the winner-takes-all match on Sunday. “I’m privileged to be part of the history. This is one of the biggest matches we will ever play against each other.” Djokovic might just be in better shape after overwhelming Nishikori, who held his serve only once all match. “I pretty much executed everything I tactically planned to do,” Djokovic said. “My level had been going in the right direction. I’m very glad I get to experience this feeling on the court. Now it’s coming up to the last match of the year, the match everybody anticipated.” After squandering chances while serving for the match twice in the final set, Murray converted on his fourth match point during the tiebreaker to finally come through. “It was unbelievably tough,” Murray said. “I had to fight very, very hard. Being broken twice serving for the match was frustrating. It was one of the harder matches I’ve played indoors. They are never this long.” Murray had won all six of his meetings with Raonic this year, including a straight-sets victory in the Wimbledon final. Murray just needs one last push at the end of a stunning second half to 2016, when he has won Wimbledon and the Olympics before topping the rankings for the first time. “I’m tired,” Murray said. “I’ve played so much tennis the last few months. I’ll just give my best effort tomorrow. It’s going to be tough, obviously, but I’ll give my best shot.” The ATP Tour, meanwhile, announced a new seasonending tournament for 21-and-under players beginning in Milan next November. Called the Next Gen ATP Finals, the tournament will feature the best seven 21-and-under players in the rankings plus a wild card. While the tournament will follow a similar roundrobin format to the ATP Finals, it will also feature rule changes and innovations yet to be announced. ATP Executive Chairman and President Chris Kermode says the event will “act as a launch pad for tennis innovation, as we bid to make our sport more attractive to the changing consumer habits of the next generation of fans.” The event will award $1.25 million. The tournament will be held at Fiera Milano Stadium from November 7 to 11 and will remain in Milan for five years. AP

The world’s top 2 players had contrasting wins in the semifinals at O2 Arena, with Andy Murray surviving a match point to beat Milos Raonic in three hours and 38 minutes, and Novak Djokovic needing just 66 minutes to dispatch Kei Nishikori.

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AS VEGAS—Claressa Shields didn’t feel at her best, but her pro debut was a winning one anyway. The two-time Olympic gold medalist won a decision on Saturday over Franchon Crews in a four-round super-middleweight fight, making the transition to the pros after the most successful amateur career for an American woman. Shields came back from a slow first round to land the bigger punches in an entertaining fight on the undercard of the Sergey Kovalev-Andrew Ward light-heavyweight title fight on the Las Vegas Strip. “It’s not what I wanted but to be called on, last

minute, for a fight of this magnitude,” Shields said. “I am proud of myself. We will fight again in the future.” Both women were fighting without headgear for the first time but it didn’t seem to be a factor as they traded punches freely before a sparse but appreciative crowd. Shields won all four rounds on the scorecards of the three ringside judges. Shields, who became the first American woman to win a gold medal in the 2012 Olympics and added another in Rio in August, had vowed to be impressive in her first pro fight. And she wasn’t shy about trading punches with Franchon, a Baltimore fighter who lost to

POWER OF THE SELFIE

Correspondent

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OSTON—It resembles the symbol for infinity: a sideways “S’’ that Kara Goucher, Molly Huddle and other elite US athletes suddenly are sporting on biceps, wrists and shins. The tattoos are temporary. But the campaign they represent is an all-out attempt to permanently purge competitive athletics of doping. “People are getting the impression that everyone’s dirty,” Goucher, a top-ranked marathoner based in Boulder, Colorado, told The Associated Press. “We need to build the sport back up in a positive light.” That’s the goal of the Clean Sport Collective, a new anti-doping initiative making a splash on social media. It launched this month with an aggressive campaign on Facebook, Twitter and other platforms. Olympians and amateurs alike have been publicly pledging to live, train and compete “clean”—totally free of banned performance-enhancing drugs—and taking selfies aimed at both inspiring and shaming track-and-field competitors, swimmers, cyclists, triathletes and others. Significantly, their bully pulpit is getting a boost from the corporate world: Brooks Running, Oiselle, Skechers and other companies have signed on as partners. Shanna Sparks Burnette, a former Division I collegiate runner, cofounded the Collective to get the focus off the cheaters and back onto athletes committed to drug-free achievement, whether at an Olympics or a local 5K. “We really wanted to make a positive impact and change the narrative to celebrate the brands and all of the amazing and inspiring people who are doing it the right way,” she said. “The mentality is ‘win at all costs—do whatever you can do to get ahead.’ As a society of people, we need to not do that to each other.” It’s been an especially tough year on the doping front. Russia’s track-and-field federation remains barred from international competition, and all but one member of the team was forced to sit out the Rio Olympics after independent investigators appointed by the World Anti-Doping Agency issued a damning report into widespread use of banned substances. Kenya, too, has been caught up in dozens of offenses implicating dopers who robbed clean athletes of winnings and glory. Last month former Chicago and Boston Marathon champion Rita Jeptoo had her doping ban doubled to four years and was stripped of her Boston title from 2014, when she’d been hailed as a hero for winning the iconic race’s first running since the deadly 2013 finish-line bombings. Huddle, a two-time Olympian, said it’s gotten to the point where she wonders about some of the runners who outkick her in international competition. “Sports are supposed to be inspiring to people watching them, but there’s so much cynicism implanted now,” said Huddle, who wore the Collective’s tattoo on the back of her hand while finishing third at this month’s TCS New York City Marathon, her debut at the 26.2-mile distance. The upstate New York native, who now lives and trains in Providence, Rhode Island, is calling for a onestrike-you’re-out approach to the doping scourge—a lifetime ban, not just a brief suspension, for those who test positive once for a banned substance. “That would put the fear in the back of an athlete’s mind: ‘What if I get caught?’” she said. “Right now there’s just not enough risk.” The Clean Sport Collective means business. Pro athletes who take the pledge promise to donate $25,000 to the nonprofit if they ever test positive. Those opting for the extra step of certification have to get bloodwork and a “biological passport” that attests they’re drug-free. Corporate partners, likewise, commit to sponsor and invest in clean athletes only. And athletes of all abilities are using the hashtag #cleansportco to post about their vows. To Kevin Rutherford, CEO of Nuun Life, a Seattle-based sports hydration and energy company, that makes sense for both the finish line and the bottom line. “There are very few brands that are saying something outwardly. I just think we’ve got to take a stand and say we won’t stand for it—we’ll only work with clean athletes,” he said. “There’s been scandal after scandal. It’s talked about, it hits the headlines, and then it goes away. How do we make it a conversation, a movement? How do we make doping the smoking of sports?” Jesse Williams, global sports marketing manager at Brooks Running, said contracts for the elite athletes he sponsors all contain a clause forbidding the use of performance-enhancing drugs. “If we don’t hold our athletes to the highest standard, we’re not moving the sport forward,” he said. “If there’s no punishment for the crime, what’s the incentive to stop doing it?” Huddle hopes the sport can clean up its act. “Amazing still does exist,” she said, “and clean athletes are still getting it done.” AP

sports

her during the Olympic trials in 2012. Shields was pushed to the canvas twice by Crews, who started strong but seemed to tire quickly. “It feels so good to have just made my pro debut,” she said. “This is what I’ve been training for. I’m faster and I hit harder.” Shields, from Flint, Michigan, weighed 167 pounds to 168 for Crews. The 21-year-old Shields said she plans to fight up to 10 times in her first year as a pro. Her goal is to one day headline a pay-per-view card of her own. “I believe 150 percent in my boxing ability,” she said

This undated photo shows residents in Ormoc, Leyte, queueing for the services of a lone automated teller machine to get their allowance via the Conditional Cash Transfer (CCT) Program, or the Pantawid Pamilyang Pilipino Program (4Ps) of the national government. The CCT or 4Ps, a social safety-net tool to help alleviate the life of the poorest of the poor Filipinos, began in 2008 by then-President Gloria Macapagal-Arroyo. NONIE REYES By Rea Cu @ReaCuBM & Claudette Mocon

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Olympic gold medalist Shields wins pro debut L

before the fight. “I know I’m a great fighter. I fight better than 90 percent of the men who box now. I just know that, and I’m not at my best yet.” Women’s boxing has largely been a fringe sport in recent years, and women have rarely appeared on televised cards. While the fight was on the undercard of Kovalev-Ward, it wasn’t a part of the pay-per-view telecast. AP

Olympic champion Claressa Shields (right) »landsTWO-TIME a solid punch on Franchon Crews. AP

Continued on A15

CAR SALES SEEN PASTTHETARGET T The original sales target of the local auto industry for 2016

shoout in london BusinessMirror

an land reclamation be pursued through public-private partnerships (PPPs)? What are the roles of the Philippine Reclamation Authority (PRA), other government-owned and -controlled corporations (GOCCs) and government instrumentalities (GIs), local government units (LGUs) and private-sector proponents (PSPs)?

350,000 units

A front page of a Chinese newspaper with a photo of US President-elect Donald trump and the headline “outsider counterattack” is displayed at a newsstand in Beijing, China, on november 10. AP Photo/Ng hAN guAN

B

Alberto C. Agra

he local automotive industry remains bullish on the Philippine market, with sales expected to hit 380,000 units by the end of the year and 510,000 units by 2020. Lawyer Rommel G. Gutierrez, president of the Chamber of Automotive Manufacturers of the Philippines (Campi) and first vice president for government affairs of Toyota Motor Philippines, said the outlook for the local auto industry in the medium term is “positive”.

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EIJING—Donald Trump is a mixed blessing for Chinese leaders. Trump’s threats to tear up trade deals and hike tariffs on Chinese goods look ominous. If carried out, they could chill thriving commercial ties at a time when Beijing is struggling to shore up economic growth.

PPP Lead

c1

Part One

IVING money to the poor is often considered by Christians as alms-giving—eight years ago it was dubbed conditional-cash transfer (CCT). Seeing the CCT as the rage of least developing countries in the early years of the millennium, then-President Gloria Macapagal- Arroyo followed Brazil’s cue and steered the government on its own version of the CCT. In a briefing paper in 2008, the Department of Social Welfare and Development (DSWD) called Arroyo’s

PESO exchange rates n US 49.4190

Conditions that must be met by beneficiaries of the Pantawid Pamilyang Pilipino Program 1) Pregnant women must avail themselves of prenatal and post-natal care and be attended during childbirth by a trained health professional; 2) Parents must attend family development sessions; 3) 0-5 year old children must receive regular preventive health checkups and vaccines 4) 3-5 year old children must attend day care or preschool classes at least 85 percent of the time; 5) 6-14 year old children must enroll in elementary or high school and must attend at least 85 percent of the time; 6) 6-14 year old children must receive deworming pills twice a year. Source: PIDS, citing DSWD website

CCT—Pantawid Pamilyang Pilipino Program, or 4Ps—as a poverty-reduction and social-development strategy of the national government. The

program “provides conditional-cash grants to extremely poor households to improve their health, nutrition and

“The 2016 projection is 380,000 units for the year. January to September, we’re already 26 percent higher from the same period than last year. We’re confident we can hit 380,000 units based on actual sales from first to third quarter,” Gutierrez said during the Ateneo Graduate School of Business forum, titled “Change: Corporate Transformation in the New Economy”, held in Santa Rosa, Laguna. The auto industry recorded sales of 293,299 units in January to September, more than the 231,522 units sold in the same period last year. Including sales of imports, total auto industry sales reached 341,679 units in 2015. This 380,000-unit goal by year-end is higher than the 350,000 total industry sales projected by Campi earlier. As of September, the industry has already attained 80 percent of its goal. Gutierrez also said car sales in 2017 could reach 400,000 units; 450,000 in 2018; 475,000 in 2019; and 510,000 units in 2020. “By 2020, that figure can reach 500,000 to 510,000 units per year, unless the government would change its policies. We think these yearly targets can easily be Continued on A16

Continued on A16

n japan 0.4495 n UK 61.3883 n HK 6.3707 n CHINA 7.1914 n singapore 34.8119 n australia 36.6442 n EU 52.5176 n SAUDI arabia 13.1805

Source: BSP (18 November 2016 )


A2 Monday, November 21, 2016

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PHL defense indl zones eye global arms makers Continued from A1

military equipment makers will locate to buttress our arms-making and military equipment-manufacturing capability. “This is not just for the transfer of technology. We have military-reservation areas that can be used as defense industrial complexes where global arms makers can locate,” Plaza told reporters during the seventh anniversary of property consultancy firm, KMC Savills recently.  The Peza is currently coordinating with the Department of National Defense (DND) on the areas to be developed as defense industrial ecozones to determine viable locations. “I suggested we put up defense industrial complexes in vulnerable areas. There could be one in Palawan, facing the Spratlys; one in Zambales facing the Scarborough Shoal… I suggested to put up at least two in Mindanao,” Plaza said. The Peza, an investment-promotion agency mandated to create special economic zones for export-oriented industries, said it is now talking to locators in view of the defense zone being con-

Filipinos. . .

Continued from A16

However, the target of providing access to sanitation facilities was missed globally. The World Bank said around 700 million still did not have access to toilet facilities by 2015. This is something that world leaders aim to address under the SDGs, which must be met by 2030. Under SDG 6 on water and sanitation for all, by 2030 countries worldwide must

structed in the Special Economic Zone in Mariveles, Bataan. “We have an existing arsenal owned by the Armed Forces of the Philippines and the DND. We’re inviting global players in the defense industry to come over. It will be manufacturing; we’re thinking of drones, equipment, both hardware and software needed by the AFP and police,” Plaza said.  Plaza added that he already promoted the Philippines in a recently held military and police exhibit in Qatar, participated in by defense suppliers of about 86 countries.  The Peza is finalizing a list of available areas for defense industrial complex development to be ready by January.  With the administration’s push for an independent foreign policy, the Peza said it is encouraging defense industry players from other countries to consider the Philippines as a site for arms and defenseequipment manufacturing.  Plaza said these defense industrial economic zones will have to secure the approval of President Duterte as mandated by the Special Economic Zone Act.  achieve access to adequate and equitable sanitation and hygiene for all. Efforts must be undertaken to end open defecation and pay special attention to the needs of women and girls and those in vulnerable situations. By 2030, countries must also expand international cooperation and capacitybuilding support in water- and sanitation-related activities and programs, including water harvesting, desalination, water efficiency, wastewater treatment, recycling and reuse technologies.


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Monday, November 21, 2016 A3

Globe: PHL telcos serve more compared to operators in Asia D By Lorenz S. Marasigan

@lorenzmarasigan

ESPITE a cell-site backlog that runs in the hundreds, Globe Telecom Inc. claims it and the only other telecommunication provider in the Philippines serve more customers per site, compared to other operators Asia. Quoting Globe Chief Information and Technology Officer Gil B. Genio, the company said in a statement that “user-per-site density in the Philippines is about 2,244, based on estimates of 21,000 total cell sites against Internet users of around 47.1 million.” Vietnam, which is similar in size to the Philippines, has a much lower user-per-site density of only 860, based on total number of cell sites of 55,000, against Internet users of 47.3 million, which is also almost equal to the Philippines’s total number of Internet users of 47.1 million, Globe claimed.

Malaysia, with total cell sites of 22,000 against Internet users of 20.6 million has a user-per-site density of 937, Globe alleged. Japan with 220,000 cell sites against Internet users (Csaiu) of 115 million has a user-persite density of 522, while China with 1.18 million Csaius totaling 688 million, has a user-persite density of 566, according to the listed firm. “Currently, [we have] a cellsite back log of around 3,000 sites,” Genio said.  He blamed this to “ difficulties in securing permits from various local

government units, homeowners associations and other government agencies that cause considerable delay in the construction of such facilities.” Genio claimed they need at least 25 permits to put up one cell site. He also alleges that the process to secure a permit takes at least eight months. He said “construction of additional sites is critical in improving Internet services in the country, pointing out that this will provide more bandwidth for local Internet users.” Genio is using this as basis so that the Philippines avoid adopting an “open-access model”, adding that such policy is “good only for mature economies with good infrastructure investments.” He, however, failed to disclose his source for such assertion. T he open-access model a llows the sharing the physical infrastructure across multiple operators, which can contribute significantly to improving cost effectiveness. In the Philippines such model should be applied only in industries where players contribute

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infrastructure investment on a reciprocal basis, Genio alleged.   “The problem is congestion because of disproportionate number of cell sites versus traffic,” Genio said. “Tower sharing will not alleviate congestion as current sites are in same locations. Tower colocation will not solve anything if we maintain same num-

ber of cell sites; rather, we need to build more sites.” To improve user-per-site density in the Philippines, the government needs to prioritize infrastructure builds for the telco industry. T he gover n ment , pa r t ic ularly at the local level, should simplify the acquisition process for cell sites and rationa lize

permitting process, including tower fees, he said. Spectrum management, Genio said, is also important. “Spectrum allocation is a function of site density in order to serve customers effectively. Spectrum must not be left in the hands of private companies that do not use it to benefit consumers,”he said.


Economy

A4 Monday, November 21, 2016 • Editors: Vittorio V. Vitug and Max V. de Leon

BusinessMirror

PHL eyes more bamboo exports

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By Jonathan L. Mayuga

@jonlmayuga

he Philippines is eyeing to boost its share in the global market for commercial bamboo products with its plan to establish 1 million hectares of bamboo plantation in critical watershed areas and other sites under the Enhanced National Greening Program (ENGP) within the next six years.

On Monday the Department of Environment and Natural Resources (DENR), in partnership with the Climate Change Commission (CCC) and the Office of Sen. Loren B. Legarda, will host a symposium and exhibit showcasing bamboo as a strategic tool to mitigate the effects of climate change and a driving force for sustainable economic development. With the theme “Bamboo for Resilience”, the daylong National Symposium and Exhibit on Bamboo and Climate Change to be held at

the Hotel Sofitel in Pasay City, aims to boost the country’s commercial bamboo industry. The ENGP aims to rehabilitate an estimated 7.1 million hectares of forestlands from 2016 to 2028. A member of the Philippine Bamboo Industry Development Council, Environment Secretary Regina Paz L. Lopez earlier issued a policy pronouncement that the DENR will go on a “massive” bamboo-planting activity. Bamboo is now becoming a popular source of materials for

furniture and other manufactured wood articles. The Department of Science and Technology has been promoting the cultivation of bamboo and has developed various techniques to boost cultivation, harvesting and use. Likewise, the DENR’s Ecosystem Research and Development Bureau has been conducting research and development to boost bamboo production and use to enhance furniture production both for local and export. Lopez earlier vowed to promote social enterprise through the massive greening program of the Duterte administration and wants people in upland communities to get direct benefit from the endeavor. The Philippine Bamboo Industry Development Council was created under Executive Order 879 signed in 2010 by then-President Gloria Macapagal-Arroyo to promote the development of the country’s bamboo sector. The national symposium on bamboo will bring together some 200 experts, policy-makers and key stakeholders in the bamboo sector to discuss the role of bamboo in climate mitigation.

The initiative also aims to promote bamboo as a suitable replacement for timber and other construction materials. Other speakers include Legarda, CCC Secretary Emmanuel de Guzman, Trade Secretary Ramon M. Lopez and Ilocos Sur Rep. Victorino Savellano. Among the topics to be discussed are bamboo biology, bamboo utilization, bamboo enterprise, bamboo postharvest technologies, and policy and advocacy support for bamboo. Participants will have the opportunity to witness the various uses of bamboo and learn about the opportunities in the bamboo value chain, particularly in the establishment of community-based enterprises in rural areas. Bamboo is a fast-growing plant. Some bamboo species grow at up to 1 meter a day. It is a high-value crop and effective in mitigating climate change, given its fast biomass production and renewability. The resource plant sequesters more carbon at 400 percent per unit area and gives off 35 percent more oxygen than other trees. The bamboo dies if left unattended for more than 10 years. Harvested properly and at the right time, the root of bamboo survives and continues to store carbon as the harvested stems grow back. Of the 1,000 species of bamboo on the planet, 49 grow abundantly in the Philippines. This gives the country the potential to become the second-largest bamboo producer in the world, next only to China, whose current market share is around 50 percent. In 2009 the Philippines ranked sixth as the biggest exporter of bamboo products worldw ide, with a total export value reaching $30 million. The international market value of commercial bamboo reached $20 billion in 2015, owing to the growing demand for eco-friendly alternative to wood to conserve the world’s remaining forests. Bamboo can reach maturity in five years and can be harvested once every two years for about 100 to 120 years. It belongs to the Poaceae (Gramineae) family of grass, just like sugarcane and corn.

‘Typhoons force affected families to seek other sources of income’ By Cai U. Ordinario @cuo_bm

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eather events, such as typhoons, often force households to seek other sources of income and/or send family members to the labor market, according to a study by the Philippine Institute for Development Studies (Pids). In a study, titled, Weather Events and Welfare in the Philippine Households, Pids Research Fellow Connie Bayudan-Dacuycuy said overall consumption of households during weather events decline depending on the composition of the household. This is not only because of higher prices but for households engaged in businesses and/or farming activities, they expect these activities

to weaken during weather events, thus forcing them to cut their consumption of goods and services. “These same negative expectations will likely drive households to become more aggressive in seeking additional income from sources, like gifts and supports, by engaging in entrepreneurial activities or by sending other family members to the labor market,” Dacuycuy said. The research findings showed that extreme weather events, such as typhoons, force households to substitute expensive food items, such as beef, by purchasing chicken. Households also consume more corn, fruits and vegetables. However, for households with children under school age, household consumption is affected by the need to purchase dairy food

items. The presence of children in households also increases the allocation of spending for rice and healthy foods, particularly vegetables and fruits. Households with elderly members, meanwhile, showed consumption is affected by expenditures on medical services. “Understanding how households allocate their resources is an important component of formulating policies to abate the effects of weather variability and possibly extreme weather events,” the study stated. With households choosing to substitute food choices with cheaper alternatives, such as chicken, should serve as sufficient information to support efforts to grant input subsidies. These input subsidies could

stave off the price increase, resulting from the damages of tropical cyclones. In the case of the elderly, knowing their dependence on their medicine and medical needs, particularly in extreme weather events, support efforts to grant them discounts on these medical products and services. The study stated that these efforts must be strictly enforced, particularly in provinces and rural areas where enforcement is weak. “In general, the study points not only to the role of the strict enforcement of existing government laws for the elderly but also to the strict enforcement of suggested retail prices of staple goods, especially in the provinces that are frequently visited by tropical cyclones,” the study stated.

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Peza wants to offer islands for long-term lease to investors from Middle East By Catherine N. Pillas @c_pillas29

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he Philippine Economic Zone Authority (Peza) said it is planning to offer islands for long-term lease, specifically for agroindustrial and energy projects, to oil-rich countries in the Middle East. Newly installed Peza Director General Charito B. Plaza said, with the Duterte administration’s push for an “independent foreign policy,” the Peza is “casting a wider net” to attract more investors from the Middle East. “I was with the President when he went to China and Japan, and I went further to the Middle East; to Qatar, to Dubai and Abu Dhabi to observe the Dubai Freeport Zone and how competitive they are,” Plaza told attendees of the seventh anniversary celebration of property consultancy KMC Savills. “I had the opportunity to talk to the members of the royal families in these countries, and I offered to them our islands,” she added. According to Plaza, investors from Middle Eastern countries are keen on locating in agro-industrial economic zones, considering their need for a number of farm products. “They’re so interested to lease our agricultural lands, because their countries are just mostly desert. They’re importing agricultural products from other countries. Now that they know we’re putting ecozones for agro-industrial and agroforestry they’re interested to lease,” Plaza told reporters on the sidelines of the event.

The Peza said it will be offering islands suitable for agro-industrial ecozones. Plaza added that some investors have indicated their interest in leasing land where they can put up an oil depot and a refinery. Plaza said the agency is now in talks with the Philippine Reclamation Authority and the National Mapping and Resource Information Authority to chart the potential islands that can be offered for lease. “Next week we’ll have a meeting with the agencies and they’ll be giving their inventory of islands, public lands, vacant lands and big private lands that we can convert into ecozones,” she added. The investors from Dubai, Qatar and the United Arab Emirates will be in the country this week for an exploratory visit. If the plan pushes through, Middle Eastern investors can lease the land for up to 75 years, as indicated in Republic Act 7652, or the Investors’ Lease Act. The Peza’s objective is to develop the economic zones on the leased islands, to become industrial cities, Plaza said. T he i nv e nt or y of i s l a nd s should be ready by the second quarter of 2017, in time for major Asean events that will be held in the country. During the campaign for the presidential elections, President Duterte expressed his intent to rent or lease islands in the country to foreign investors, and allow them to build infrastructure on these islands for their own use.

6 key food and drink trends in 2017

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xporters in the agriculture and food-processing business should take note of opportunities arising from six major trends set to impact the global food and drink market in 2017, ranging from traditional products, like ancient grains, to plant-based foods enhanced by technology, according to a new report. The just-released “2017 Global Food and Drink Trends” by market research service provider Mintel predicts that, in the coming year, consumers will increasingly look for products that are healthy, convenient and trustworthy. They will also search for food and drink that are recognizable, save time and contain beneficial fruits and vegetables. In addition, there are new opportunities for functional food and drink designed for evening consumption, progressive solutions for food waste and affordable healthy food for low-income consumers. Mintel identified the first emerging trend as the continued trust in the traditional and the familiar. Consumers “seek the safety of products that are recognizable rather than revolutionary,” even as they are willing to try “modernized updates of age-old formulations, flavors and formats.” Manufacturers are, thus, encouraged to look to the past for inspiration, as ancient grains, as well as ancient recipes, practices and traditions, are forecasts to continue to be popular. At the same time, “potential also exists for innovations that use the familiar as a base for something

that’s new, but recognizable, such as cold brew coffee.” In 2017 the food and drink industry will also see the growing use of plants as key ingredients, the report said. The growing preference for natural, simple and flexible diets is seen to drive the further expansion of vegetarian, vegan and other plant-focused formulations. Consumers’ strong health and wellness priorities will spur the introduction of more packaged products and recipes for home cooking that abound in fruits, vegetables, nuts, seeds, grains, botanicals and other plants associated with good health, Mintel said. Technology will play a part in this movement, as can be seen in the use of artificial intelligence to develop plant-based alternatives to animal products, including milk, mayonnaise, yogurt and cheese. The third trend is the global focus on minimizing food waste to align with efforts on sustainability, which is changing consumer perceptions. “In 2017 the stigma associated with imperfect produce will begin to fade, more products will make use of ingredients that would have otherwise gone to waste, such as fruit snacks made from ‘ugly’ fruit and mayonnaise made from the liquid from packaged chickpeas, and food waste will be repurposed in new ways, such as power sources,” the report said. Also a significant trend among consumers in the new year is to find out the “time investment” required in cooking or preparing meals. Philexport News and Features

PhilMech inks 5-year farm-machinery deal with S. Korean manufacturer By Jasper Emmanuel Y. Arcalas @jearcalas

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he Philippine Center for Postharvest Development and Mechanization (PhilMech) said it signed a five-year agreement with South Korean manufacturer Korea Agricultural Machinery Industry Cooperative (Kamico) to help the country develop farm machines. “I believe PhilMech will greatly benefit from the expertise of

Kamico, because it has experts that can help [the agency] spearhead the real development of farm machinery in the Philippines,” PhilMech Executive Director Dionisio G. Alvindia said in a statement. Kamico Chairman Shin Gil Kim and Alvindia signed the memorandum of understanding (MOU) in the company’s headquarters in South Korea on November 3. PhilMech said Kamico, a special status nonprofit corporation of agri-

cultural machinery manufacturers, spearheads the export efforts for South Korean-made farm equipment. The scope of cooperation under the MOU includes the following: establishment of agricultural mechanization complex; collaborative studies/research on machinery development; exchange of experts and/or provision of technical support; and conduct or facilitation of study tours, workshops, symposia, training courses and

exhibitions on subjects of mutual interest, according to PhilMech. Under the five-year agreement, Kamico will also support the Philippine government’s efforts to secure official development assistance (ODA) in agriculture-related fields. Alvindia said tapping the expertise of Kamico will help the Philippines manufacture farm machinery, including local fabrication of small engines that are critical components of farm equipment.

“The farm-machinery industry in the Philippines needs to upgrade its manufacturing and design capabilities, so the small farmers will get ‘value for money.’ At present, the industry has a hard time competing with equipment imported from other countries,” Alvindia said. Developing the local farm-machinery manufacturing industry is mandated under Republic Act 10601, or the Act Promoting Agriculture and Fisheries Mechani-

zation and Development in the Country”, or the AFMech law. Developing the country’s capabilities to manufacture farm machinery is part of PhilMech’s new advocacy, called “Stakeholder-driven Research and Development Extension”, of which the major components include getting more inputs from target users in developing farming technologies, and establishing a unified Research and Development Extension agenda among government agencies.


The Nation BusinessMirror

A6 Monday, November 21, 2016 • Editor: Dionisio L. Pelayo

Watchdog: Grant extra powers only after Tugade leaves DOTr By Lorenz S. Marasigan

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@lorenzmarasigan

TRANSPORT and consumer watchdog has called on both houses of Congress to defer the granting of requested emergency powers until such time that President Duterte finds someone whose character and reputation are beyond reproach to head the Department of Transportation (DOTr). Road Users Protection Advocates (Rupa )convener Ray Junia raised the issue of propriety and competence as the reasons the requested extra powers should be withheld until Transportation Secretary Arthur P. Tugade has voluntarily relinquished or is kicked out from his post. “Conflict of interest is one of the core issues here. It is wrong to appoint a businessman who is a major player in the industry supervised by the department where he is assigned, and consequently it is improper for that person to accept the post even it was offered to him” Junia explained. “We want to make it clear that we support the granting of emergency powers to President Duterte, but this must be done with the assurance that the people whom he will tap to implement these [powers] are truly competent and would have no other interest but to promote public good and welfare,” Junia said. “It is not correct to grant these powers now under Tugade’s watch because of his highly suspect character and loyalty, as well as obvious incompetence as observed by the lawmakers themselves during the hearings,” he added. Earlier, Speaker Pantaleon D. Alvarez scored DOTr officials for their lack of clear-cut plans, which he claimed causes the delay in the grant of the emergency powers. “The problem was not with us in the House. We asked DOTr officials what they have done or what are their plans. They told us nothing. We cannot give emergency powers if we do not know where or how these would be used,” Alvarez said. Sen. Grace Poe, likewise, bewailed the incompetence of DOTr officials who were at a loss on how they will implement the measure and where they intend to secure the funding of around P8 trillion that comes with it. Junia, meanwhile, pointed out that Alvarez even lambasted Tugade in a recent radio interview for his choices of three undersecretaries who were reportedly “planted” in the department by big business conglomerates where they used to be connected. Alvarez said part of the problem lies with some of Tugade’s undersecretaries “who have their own personal interests to protect.” The chairman of the House transportation committee, PDP-Laban Rep. Cesar Sarmiento of the Lone District of Catanduanes, on the other hand, said DOTr officials appear “confused on the specific powers they need.” He noted that Tugade and his men do not realize that they already have the power to effect change in the transportation sector through their mandate and other existing laws. Sarmiento declared that Tugade and his underlings are “confused” on what the traffic crisis is and consequently on what emergency powers they need to solve it. “The bottom line here is that the lawmakers themselves are aware of the incompetence and suspect loyalty of Tugade and his men,” he qualified. “Therefore, it behooves them to defer the granting of the measure until such time that Tugade and his people are replaced by officials of unimpeachable reputation who are also more responsible and knowledgeable of the tasks that come with their positions,” Junia stressed.

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Audit commission uncovers SBMA irregularities during Aquino watch By Jovee Marie N. dela Cruz

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@joveemarie

s much as P3.5 billion, representing a hefty 85 percent, of the P4.1 billion accounts receivable-trade balance of the Subic Bay Metropolitan Authority (SBMA) last year “were doubtful”, according to the Commission on Audit (COA), reporting on its audit of the agency for 2015. Showing probably the strongest indication yet of irregularities committed by agency officials during the Aquino administration, the COA observed the “existence and correctness” of the said figure were not established by the previous administration. The commission said it had sent confirmation letters to 57 residents of the SBMA housing units of which 37 with payables of P88.2 million were returned with remarks “no one to receive,” “abandoned,” “unlocated,” “different unit owner” and “closed-under SBMA control,” while 20 other mails with receivables of P113.7 million had no replies. The audit team also sent confirmation letters to 30 locators

with total receivables of P3.29 billion, of which 11 with payables of P627.58 million were returned with comments “company closedunder control of SBMA” and “no one to receive”, while 19 locators with payables of P2.66 billion did not respond. The audit team noted that the letters were “returned because of doubtful addresses, which were lifted from the SBMA’s Integrated Financial Management System [IFMS] under the module ‘Accounts Receivable Reports-Accounting Report-Statement of Account [Locators] [Residents]’, and from the aging schedule submitted by the accounting department.”

Subic Bay Metropolitan Authority

The COA, in its report, noted, moreover, that “the reported receivables of P489.3 million or 11.92 percent of the total trade receivables, which had been in the books since 2013 with ages three to four years or more, remained nonmoving.”

Diño forms audit team

IN the wake of the COA findings, SBMA Chairman Martin B. Diño immediately created an eight-man audit team that would “ferret out the truth” on the SBMA operation and management under its former chairman, Roberto Garcia, and seven members of the board of directors—Benjamin E. Antonio, Wilfredo S. Pineda, Bienvenido O. Benitez, Joven D. Reyes, Francis S. Garcia, Raul F. Marcelo and Cynthia C. Paulino. “We will seek the truth and go after

those who were responsible for any wrongdoing. We will definitely file charges against them,” Diño said, as he named team members to undertake a “legal and financial audit” of transactions entered into by the previous chairman and board. The audit team, Diño added, is empowered to “direct the production of documents” such as books of accounts, contracts and financial statements, and to “conduct interviews and take depositions of relevant personnel.” Named by Diño to compose the transition and audit team are lawyers Emer Aceron, Victor Pablo C. Trinidad and Jose Arollado Jr., Rolando Allan Asi, retired Brig. Gens. Percival Barba and Arnulfo J. Marcos, Rod Banag and Jose Rey Recinto.

Philippines girds for major role in engineering services industry

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HE Philippines is poised to become a major global player in engineering expertise and services, as industry leaders position Filipino engineers as a “global brand” in the fast-growing, highly competitive and technology driven construction industry. Speaking at the yearly convention of civil engineers in Davao City, Ernesto S. de Castro, president of the Philippine Institute of Civil Engineers (Pice), said that with the projected boom in construction in the Philippines and many parts of the world, engineering services and Filipino engineers will be in great demand worldwide. Citing a report by McKinsey & Co., de Castro noted that the world needs to invest $3 trillion in infrastructure annually through 2030, or a total of $49 trillion. The bulk of the investment in infrastructure will be in emerging

economies, with Asia accounting for 48 percent, or $24 trillion, of total investment. Infrastructure investments in the United States and Canada will account for 22 percent, or $11 trillion. “This means massive need for experts, engineers, talents and engineering services,” de Castro said. The Philippines, he said, will also be in “construction mode” in the next five years, with government infrustructure investment programmed at some P8 trillion. “We are building a new Philippines,” de Castro said, citing the Duterte administration’s thrust to build a new political order anchored on federalism, economic development through industrialization, social order based on discipline and public order and safety, and a new physical landscape through massive infrastructure. “The physical building of a new

Philippines will be fueled by both public and private sectors. In the public sector, the government is poised to invest not less than P8 trillion in infrastructure—the biggest outlay ever,” said de Castro, who is the CEO of ESCA Inc., a homegrown engineering company that has made its mark in the international arena. De Castro said such spending will not only drive the construction industry but power the economy, pushed forward even further by private-sector investments. He said that, with the world building for the next 14 years, Filipino engineers should be ready and equipped with the expertise required of the changing system of infrastructure. “We would like the Filipino civil engineer to be recognized and respected anywhere and everywhere, known globally for a high level of expertise, professionalism, integ-

rity, excellence and social responsibility,” he said. De Castro added that he also sees the Philippines becoming a “Global Center of Excellence for Engineering Services”, to provide expertise and services for infrastructure projects in many parts of the world. “We are now providing engineering services outsourcing to global infrastructure projects,” he said, noting that the engineering services component of the business-process management (BPM) industry now earns $300 million for the country and employs some 13,000 employees. He said the engineering serives oursourcing sector can increase the share of the country’s outsourcing revenues from the present 1 percent to at least 3 percent by 2022. The ITBPM industry is targetting revenues to reach $40 billion by 2022. Claudeth Mocon-Ciriaco

Senators give P5-billion boost to Natl Police equipment budget

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ENATORS have crossed party lines to boost the National Police’s equipment budget next year by P5 billion, so that policemen, in the words of Senate Minority Leader Ralph G. Recto, “will be able to meet the National Police’s guarantee of a 15-minute maximum response time to all distress calls in urban areas.” Recto made the proposal during the Senate plenary debates on the 2017 budget of the Department of the Interior and Local Government last Friday. It was accepted by Sen. Loren B. Legarda, chairman of the Senate finance committee. The P5-billion additional fund for the modernization of National Police equipment will be included in the P67.5-billion Unprogrammed Fund in the P3.3-trillion 2017 national budget. Recto said the Senate moved to increase the force’s capital outlays (CO) after noticing that it will be cut from P3.82 billion this year to P3.37 billion next year, or by P500 million, “which could slow down its momentum in battling crime.” Documents submitted by the National Police to the Senate tell of an across-the-board shortage

in equipment in the National Police, “in all aspects of police work, from shoot-move-communicate to offices and databases.” In one report, the force said it lacks 16,885 long firearms, and half of its 6,169 vehicle fleet needs to be replaced or is near decommissioning. “On paper, there’s an average of three patrol cars per city and town, which is way below what is needed,” Recto said. But in a recent testimony before the Senate, the National Police chief, Director General Ronald M. dela Rosa, upon questioning by Recto, gave a higher estimate of equipment lack, “of some 18,000 short firearms, 10,000 long firearms, and 16,356 vehicles.” Recto said the force is also short of boats, “with 900 urgently needed, or one per coastal town, so that the maritime police can run after illegal fishers, polluters and sea-borne criminals.” He said another area requiring huge investment is communication, especially the nationwide 911 network. Recto said the P5-billion augmentation would allow the force to construct 80 police stations at a total cost of P425 million and

BIG AT LAST Speaker Pantaleon D. Alvarez and Senate President Aquilino L. Pimentel III lead the recitation of the PDP-Laban Party creed during the group’s Fellowship and Thanksgiving Party in Pasay City. From a marginalized party of fewer than 10 active members, PDP-Laban now controls both houses of Congress, thanks to its support for President Duterte during the May elections. NONOY LACZA

47 provincial headquarters costing P493 million. The budget estimates are on the “wish list of unfunded needs” submitted by the force to the Senate. Under its proposal, the National Police plans to buy 256 motorcycles, 132 personnel carriers, 136 light transport vehicles, 229 patrol boats, 283 satellite phones and P2-billion worth of antiterrorism equipment.

The PNP also said it would need P45 million for the titling of donated lots. Recto explained that “the P5 billion was put in the Unprogrammed Fund in order not to trigger cuts in the budgets of other agencies. Because if you add funds for one agency, you have to get it from others. So in order not to disturb the appropriations of the rest, we put it there.” Butch Fernandez


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AseanMonday BusinessMirror

Editor: Max V. de Leon • Monday, November 21, 2016 A7

UN agency calls for Thailand broadband boost Thousands rally calling on Najib to quit

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UALA LUMPUR, Malaysia —More than 10,000 yellowshirt protesters rallied on Saturday in Kuala Lumpur seeking Malaysian Prime Minister Najib Razak’s resignation over a financial scandal, undeterred by a police ban and the arrest of 20 people, mostly activists. Protesters marched in downtown Kuala Lumpur and later moved to the Petronas Twin Towers after failing to enter Independent Square, the city’s main protest venue, which was locked down by police with water-cannon trucks on standby. Some chanted “Save Democracy” and “Bersih, Bersih”—the name of the electoral reform group that organized the rally. The name means “clean” in the Malay language. Former Prime Minister Mahathir Mohamad, who has been spearheading calls for Najib’s resignation, joined the rally, adding momentum to the demonstration. “Everybody feels concerned about the kind of government we have now,” said Mahathir, wearing a yellow Bersih shirt. “We no longer live under democracy, but a kleptocracy—a nation ruled by thieves.” The rally ended peacefully after a downpour. Najib, who is attending an Asia-Pacific summit in Lima, Peru, has kept an iron grip since corruption allegations emerged two years ago involving the in-

debted 1Malaysian Development Bhd. (1MDB) state fund that he founded. 1MDB is at the center of investigations in the US and several other countries. The prime minister, who has denied any wrongdoing, has called Bersih “deceitful” and said the group has become a tool for opposition parties to unseat a democratically elected government. “We want to see Malaysia more developed and not robbed of billions of ringgit,” singer Wan Aishah Wan Ariffin, an opposition supporter, said at the rally. The protest was the fifth organized by Bersih, which also held similar demonstrations on Saturday in two Malaysian cities on Borneo island. Police estimated the Bersih crowd at 15,500. The turnout was less than the 50,000 who attended the last Bersih rally, in August 2015, which also demanded that Najib quit. Online news portal Malaysiakini put the crowd on Saturday at more than 40,000. Police on Friday raided the Bersih office and detained the group’s chairman, Maria Chin, for investigation into “activities detrimental to parliamentary democracy.” Another 19 people, mostly politicians and activists, were also detained on Friday and Saturday to prevent rioting, police said. Those detained included ruling party politician Jamal Mohamad

Yunos, whose supporters, numbering about 2,500, trooped to downtown to counter the Bersih rally. Police banned the rallies by Bersih’s yellow-shirt supporters and Jamal’s red-shirt group. Lawyer Eric Paulsen tweeted that Chin was formally detained on Saturday under a security law meant to be used against terrorists and can be held for a further 28 days. The other activists were remanded for several days in police custody. Amnesty International slammed the crackdown and called for the immediate release of the Bersih activists, describing them as prisoners of conscience. “These arrests are the latest in a series of crude and heavy-handed attempts to intimidate Malaysian civil-society activists and other human rights defenders,” Amnesty said in a statement. The investigations into 1MDB fund are centered on allegations of a global embezzlement and moneylaundering scheme. Najib started the fund shortly after taking office in 2009 to promote economic development projects, but the fund accumulated billions in debt over the years. The US Justice Department said that at least $3.5 billion had been stolen from 1MDB by people close to Najib and initiated action in July to seize $1.3 billion it said was taken from the fund to buy assets in the US. AP

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hailand is in urgent need of a boost in the capacity of fixed-line broadband infrastructure to off-load mobiledata traffic from the increasingly congested wireless network.

Allocating more frequency bands is also vital to deal with skyrocketing demand for broadband connectivity on both fixed and mobile networks, as well as promoting the affordability and accessibility of broadband services, says the International Telecommunication Union (ITU), a United Nations agency for global information and communications technology development. A white paper released by the ITU, in collaboration with Chinese telecom equipment giant Huawei Technologies, covers broadband regulation and policy in eight AsiaPacific countries, as well as measures to facilitate faster broadband deployment. The report covers Bangladesh, Cambodia, India, Lao PDR, Myanmar, Sri Lanka, Thailand and Vietnam. “We selected these eight countries because of their tremendous opportunity to improve their economic performance and social prosperity via a wide range of ICT applications and innovative business models,” said Ioane Koroivuki, regional director of ITU for Asia-Pacific. He said 2016 has been a watershed

year for broadband markets with the number of broadband subscriptions encompassing over half the global population this year. Growth in broadband penetration shows a widening gap between the developed and developing worlds. Fixed-line broadband penetration in the eight countries fell below the global average of 46 percent. The rates in Thailand and Vietnam stand equal at 36 percent, followed by Sri Lanka with 12 percent, India 7 percent, Bangladesh 4 percent, Laos 2.5percent, Cambodia 2.5 percent and Myanmar at 2 percent. “Wireless broadband infrastructure in the region is excellent,” Koroivuki said. “But the countries need to further upgrade and enhance their fixed-line broadband and optical networks to off-load mobile-data traffic and video-content traffic.” The paper also urges Thai policy-makers to boost the nationwide broadband network rollout, reinforcing Thailand’s position as a hub for Asean connectivity. Other measures like the integration of fixed-line and wireless broadband networks and the

reduction of retail broadband Internet prices should be placed to enhance Internet connectivity nationwide, he added. Koroivuki said effective strategic policy interventions are needed to promote the development of the ICT industry in the region. Facilitating and reforming incumbent operators is also essential, or if required, new competitors should be licensed in order to secure viable and properly scaled fiber-optic network deployment. Koroivuki added that the paper also suggested policy-makers look to identify and make spectrum available in the interests of the industry’s growth and public access. Spectrum, an essential input to the telecom industry, can be provided for 4G, 5G and fixed-line broadband. Spurring the creation of a robust local mobile content and application industry is essential to support the development of the telecom industry and accommodate local content focused on local needs, he said. Houlin Zhao, secretary-general of the ITU, said 148 countries have adopted a national plan or strategy for broadband development. It is estimated it will take global investment of $450 billion in network infrastructure to connect the next 1.5 billion unconnected people worldwide by 2020. Jin Yuzhi, vice president of Huawei Technologies for Southeast Asia, said governments should encourage telecom investment and infrastructure development, like submarine and land cables, data centers and other network development. TNS


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Monday, November 21, 2016

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World leaders at Apec summit take aim at Trump over trade

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IMA, Peru—Several US allies took aim at Donald Trump’s views on global trade, while China’s president made an impassioned call against the sort of protectionism favored by the president-elect at a summit of Asian-Pacific leaders on Saturday.

The Asia-Pacific Economic Cooperation (Apec) forum is taking place in Peru, as world leaders are on edge over Trump’s campaign pledges to protect US jobs by backing out of the not-yet-implemented Trans-Pacific Partnership (TPP) and renegotiating the North American Free Trade Agreement (Nafta). Mexican President Enrique Peña Nieto said Nafta benefits workers and companies on both sides of the border. Still, he expressed concern that the US could be turning its back on a bilateral-trade relationship responsible for moving $1 million worth of goods every minute. “In the face of Trump’s positioning, we’re now in a stage of favoring dialogue as a way to build a new agenda in our bilateral relationship,” Peña Nieto told business leaders. “Mexico, like the entire world, is about to initiate a new stage with the US and in commercial terms we want to give the right value to this strategic relationship between Mexico and the US.”

New Zealand’s Prime Minister John Key spoke more bluntly, saying the “tremendous despair” triggered by Trump’s trade views can’t be allowed to slow down economic integration by the rest of the world. “Even if the United States doesn’t want to engage in free trade, President Trump needs to know other countries do,” Key said. He said it’s still possible to save the 12-nation TPP negotiated by the Obama administration by introducing cosmetic changes,making it acceptable to Trump or carving out a less ambitious pact among TPP signatories that leaves out the US. “I personally think that President Trump will be very much like chairman of the corporation Trump is,” he said. “He’s a flexible business guy. He’s going to realize he has a role to play.” Chinese President Xi Jinping delivered, perhaps, the most forceful defense of free trade, given the size of his economy. In his kickoff speech from Peru

U.S. President Barack Obama (right) with China’s President Xi Jinping (left) and members of their delegations, during their meeting as part of the Asia-Pacific Economic Cooperation in Lima, Peru, on Saturday. AP/Pablo Martinez Monsivais

$1M The value of goods Nafta is moving every minute

he said the best response to rising protectionism would be for Apec’s 21 members to negotiate a freetrade area encompassing the entire Pacific Rim. “Closed and inclusive arrangements are not the right choice,” Xi said, taking a veiled stab at the TPP, which excludes China and is widely seen as an attempt to reassert US dominance in Asia. “Building a free-trade area of the Asia Pacific is a strategic initiative critical for

long-term prosperity.” Xi’s remarks came as Chinese state media blasted Trump for “trade-bashing” rhetoric that threatens global economic stability. “The billionaire-turned-politician needs to prove that derailing the global economy has not been one of the reasons he ran for US president,” official Xinhua news agency said in a commentary piece published on Saturday. President Barack Obama warned against a rush to judgment on Trump, saying at a town hall on the margins of the summit that it’s too early to conclude that the new administration will wipe out trade deals and create international problems. “Don’t just assume the worst,” he said. “Wait until the administration’s in place” before drawing conclusions. AP

Xi, Obama say stable relations Global warming fight advances important at ‘hinge’ moment despite Trump’s skepticism Temperatures rising

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.S. President Barack Obama and China’s Xi Jinping stressed at a meeting the importance of continued stable relations between the world’s two biggest economies at a time the Chinese leader described as a “hinge moment”, following the election of Donald Trump. Obama and Xi acknowledged “the uniquely consequential nature of US-China relations” and the need to forge a more stable and productive bilateral relationship, the White House said in a statement after the two presidents met at the Asia-Pacific Economic Cooperation forum in Lima. Relations with Beijing seem likely to be shaken up when President-elect Trump takes the reins in January. The Republican blames China for taking US jobs, and has said he will instruct his Treasury secretary to label the country a currency manipulator. “We meet at a hinge moment in the ChinaUS relationship,” Xi said before he met Obama. “I hope the two sides will work together to focus on cooperation, manage our differences and make sure there is a smooth transition in the relationship and that it will continue to grow going forward.”

Human rights

Obama and Xi discussed areas of disagreement at the pair’s ninth meeting, including human rights, state-sponsored hacking and territorial and maritime disputes involving China, according to a White House statement released after the meeting. “The President encouraged China to advance reforms that will help it to shift to a sustainable, domestic consumption-driven economic model, including reforms of stateowned enterprises and efforts to strengthen its financial system, and transition to a market-determined exchange rate in an orderly manner,” the statement read. “The president also underscored the urgency of addressing excess capacity in industrial sectors.” The issue of climate change, in which the US and China have played a pivotal role in recent years, was also raised during the meeting. Both leaders commented on the “progress in helping to galvanize the international response to climate change that will provide an enduring benefit to the international community,” according to the statement. Obama earlier used the final public event of his last foreign trip as commander in chief to offer some veiled advice to Trump, cautioning

that “you shouldn’t ignore the past, you should learn from it.” Democracies “rot from within” if they cease to protect press freedoms, an independent judiciary and the rights of minorities, Obama said during a town-hall style meeting with young Latin American leaders at the Pontifical Catholic University. The outgoing president told students that for all of its merits, “democracy can be frustrating” and that “the outcomes of elections don’t always turn out the ways that you hope. We’re going through that in the United States.” “Ch a n g e g e n e ra l l y d o e s n’t h a p p e n overnight,” Obama said, and it’s important to remember the US has had “amazing” changes in the past half-century. Still, “societies don’t move immediately” and “sometimes you take two steps forward and you take one step back,” he said.

Trade tensions

Obama said he expects “no major changes” to US relations with Latin America, including Cuba, after the new administration takes office, although tensions on trade are likely to increase. Obama’s remarks came in response to questions that touched broadly on democracy, development, women’s rights and the European alliance, and that only once mentioned Trump directly. The president’s answers weaved between principles that can apply to any nation and examples of the US experience. The fo ru m c a m e a s O b a m a a n d h i s a i d e s privately consider the policy implications of Trump’s newly announced choices for top administration positions, including Alabama Sen. Jeff Sessions for attorney general and retired Lt. General Michael Flynn for national security adviser. Between them, Sessions and Flynn have taken positions on Muslims, immigration, torture, and gay- and minority-voting rights that have raised objections by civil-rights advocates. Obama said he’s hopeful immigration policy under Trump will continue to “invite talented young people to come in and continue to make a good life for themselves.” He didn’t address another issue—what Trump’s election will mean for about 750,000 young undocumented immigrants who submitted personal information to a government program meant to protec t them from deportation. Bloomberg News

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ore than 190 nations, including the US, China and Saudi Arabia, vowed to step up their efforts to fight global warming, despite concerns that US President-elect Donald J. Trump will pull the richest polluter out of the process when he takes office next year. Envoys and more than 50 national leaders in Marrakech, Morocco, agreed early on Saturday to a road map for developing a rulebook by 2018 that will strengthen the landmark Paris Agreement signed last year to limit fossil-fuel emissions and keep temperature increases to 2 degrees Celsius by the end of the century. “We’ve fulfilled the job we came here to do,” European Union Climate and Energy Commissioner Miguel Arias Cañete said in an interview immediately after the talks wrapped up. “The message this sends to America is that there is full commitment from the global community, that climate change is such a big challenge, that it’s much more important than countries and their elections.” Even delegations that previously frustrated progress at the United Nations talks went out of their way to urge Trump to cast aside his skepticism and embrace cleaner forms of energy. Trump said before the US election that the idea of climate change is a hoax invented by China and that he’d scrap the Paris accord after taking office January 20.

‘Really confident’

“We’re really confident” Trump will help efforts to tackle climate change, Thani Ahmed Al Zeyoudi, climate change and environment minister for the United Arab Emirates, said in an interview just before the talks concluded. “Trump is coming from the private sector,” he said. “He’s a businessman and he sees there are huge business opportunities” from this. India and Brazil kept the talks running past midnight, disagreeing over how to move forward on a list of issues from Paris, such as negotiating a long-term climate finance goal and time frames for countries’ carbon-reduction targets. A compromise was eventually reached with countries agreeing to return to those issues at talks in Bonn next year. During the talks, Saudi Arabia ratified the Paris accord, and 48 of the most vulnerable countries vowed to fuel their economies with 100-percent renewable energy by between 2030 and 2050. China’s envoy noted it was former US Presidents Ronald Reagan and George H.W. Bush who started the climate talks long before officials in Beijing were engaged in the issue. Trump’s transition team has offered scant comment on the issue.

Even with the Paris agreement, temperatures are set to rise by as much as 3.4°C by 2100 from preindustrial levels, according to a United Nations report this month. That would mark the quickest shift in the climate since the end of the last ice age some 10,000 years ago, threatening to upend economies worldwide with more powerful storms and frequent droughts. “We don’t know what countries are still waiting for to move toward net carbon neutrality,” said Edgar Gutierrez, Costa Rica’s environment and energy minister. “All parties should start the transition, otherwise we all suffer.” The talks in Marrakech this week were focused on a  number of technical measures that would help put flesh on the 13-page Paris Agreement sealed in the French capital in December. Those include:

n A road map to write a rulebook by 2018 for how the voluntary limits on emissions agreed upon in Paris will be assessed and overseen. n A pledge by Germany, Italy, Sweden and Belgium for $81 million that the Adaptation Fund requested to pay for projects in its pipeline. n A Paris Committee on Capacity Building that will start work in 2017 helping developing nations build their ability to rein in emissions and adapt to climate-related harm. n A decision to review a “loss and damage” mechanism that would compensate the poorest nations for the worst impacts of climate change. n A partnership among nations aimed at spurring use of renewable energy. n A political call in the form of the Marrakech Action Proclamation endorsed by the nations present, emphasizing the group is“more united” than ever on implementing the Paris deal Next year’s talks will be hosted by Fiji but held at the UN headquarters in Bonn. Delegates drawn mostly from energy and environment ministries appeared to grow increasingly confident that they could still deliver on the ambitions of Paris even if Trump renounced it. “The transformation to a climate-friendly world agreed on in Paris is well under way and can no longer be halted,” German Environment Minister Barbara Hendricks said on Friday as the talks drew to a close. China, which helped prevent an agreement in 2009,  said that even without all countries aboard, the UN process would advance just as it did after the US renounced the Kyoto climate accord in 2001. Bloomberg News


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Pope decries ‘virus’ of polarization over race, faith

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ATICAN CITY—Pope Francis warned against what he called a “virus of polarization” and hostility in the world targeting people of different nationalities, races or beliefs, as he led a ceremony on Saturday, giving the Roman Catholic Church 17 new cardinals from six continents. The consistory ceremony in Saint Peter’s Basilica formally inducted the churchmen into the cardinals’ ranks. Francis used his homily to also caution the new “princes of the church”, as cardinals are sometimes called, to guard against animosity creeping into the church, as well, saying “we are not immune from this.” The pope spoke of “our pitiful hearts that tend to judge, divide, oppose and condemn” and cautioned somberly against those who “raise walls, build barriers and label people.” Earlier this year, when asked about the plan by Donald Trump, then a Republican US presidential candidate and now president-elect, to build a wall to keep Mexicans and others from illegally entering the US, the pope replied that anyone advocating building walls isn’t a Christian. Francis, in a message a few days earlier to US bishops, had urged them to help heal a society facing growing polarization. On Saturday, after receiving his red hat, Mexican Cardinal Carlos Aguiar Retes, archbishop of Tlalnepantla, expressed concern about Trump’s plans, including deporting large numbers of immigrants living in the US illegally, soon after assuming the presidency. “You can’t divide a family. You can’t divide a community. You can’t divide the world,” the prelate said in reply to a question by The Associated Press about Trump. The Mexican churchman added: “One thing is the election campaign. Another thing is reality.” In Saturday’s homily, Francis commented on how “we see, for example, how quickly those among us with the status of the stranger, an immigrant,

or a refugee, become a threat, take on the status of an enemy. An enemy because they come from a distant country, or have different customs. An enemy because of the color of their skin, their language, or social class.” He added: “The virus of polarization and animosity permeates our way of thinking, feeling and acting.” Francis also lamented the tendency to “demonize” one’s opponents, “so as to have a ‘sacred’ justification for dismissing them.” Cardinals serve as papal advisers and, someday, elect the popes’ successors. Popes look to cardinals who share their approach to the church’s mission in the world. Indianapolis Archbishop Joseph Tobin is among the newly made cardinals. Tobin defied the governor of the US state of Indiana, Mike Pence, by welcoming Syrian refugees. Tobin, in January, will become archbishop of Newark, New Jersey, while Pence will be installed as US vice president. Chicago Archbishop Blase Cupich, after being made a cardinal at Saturday’s ceremony, said the church has a special role in trying to bring people together across the political spectrum. He noted that on Sunday, Masses are celebrated in 26 languages in his diocese. “People feel disenfranchised” from sharing in the common good, the cardinal said in an interview with The Associated Press (AP). Another American in the latest crop of cardinals is Irish-born Archbishop Kevin Farrell, who led the Dallas diocese before Francis appointed him to head the Vatican office dealing with family issues. At a post-ceremony reception, Farrell acknowledged that polarization is felt within the church, too.

New Cardinal Mario Zenari, Apostolic Nuncio in Syria, receives the red three-cornered biretta hat during a consistory inside the Saint Peter’s Basilica at the Vatican on Saturday. In the ceremony to formally give the Catholic Church 17 new cardinals, Francis lamented how immigrants, refugees and those from different races or faiths are increasingly seen as enemies. AP/Gregorio Borgia

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The number of new cardinals installed by Pope Francis “We’ve become gods on both sides—gods on the left, and gods on the right, and neither one of these are correct,” Farrell told an AP reporter. The clash of mentalities between the conservative camps and the socalled progressives chosen by Francis has played out publicly in recent days. Four prominent, disgruntled cardinals, including a US prelate, Raymond Burke, who is one of Francis’s most vocal critics, in a letter to the pope, aired their doubts about his more compassionate approach

to the contentious issue involving divorced Catholics. They fear his approach could sow confusion among the faithful. Church teaching forbids divorce, and says Catholics who remarry without annulments of their earlier marriage are essentially adulterers who can’t receive communion. In a document earlier this year, Francis suggested that clerics could decide case by case if these Catholics could receive Communion. Farrell, asked about the tensions over the divorce issue, appeared to be open toward the pope’s prescription for more compassion. “There is no situation in life that’s black and white. Anybody that’s lived in this world will have encountered those situations in their personal lives,” Farrell said. The new cardinals, who pledged loyalty to the pope, come from Africa, Asia, Europe, Oceania and North and

South America. One of them, an 88-year-old Albanian priest, Ernest Simoni, spent 18 years in prison because of his faith during the communist regime in his homeland. Since cardinals are usually bishops already, Francis bestowed a rare honor in giving that rank to Simoni, a simple priest. When Francis visited Albania in 2014, he was brought to tears when Simoni told him how he was persecuted. The pope’s envoy to Syria is now Cardinal Mario Zenari. The Italian archbishop remarked how the bright crimson hue of the cardinals’ cassocks and of the square, peaked headgear evokes the color of the blood spilled by innocent children killed in the five-year-old civil war there. Also among the new cardinals is Archbishop Dieudonne Nzapalainga of Bangui, Central African Republic. Last year Francis visited

Nzapalainga’s country, bloodied by sectarian violence between Christian and Muslim militants. Thirteen of the 17 new cardinals are under 80 years old and, thus, eligible to vote in a secret conclave for the next pope. Francis has now appointed 44 of the 120 cardinals young enough to elect his successor. The others were named by the previous two pontiffs, John Paul II, whom Francis made a saint, and Benedict XVI, who retired in 2013, and generally reflect a more conservative leaning on church issues. After the ceremony, the new cardinals and Francis took minibuses to the monastery on Vatican grounds where Benedict lives so they could greet him. One of the cardinals, an 87-yearold bishop from Lesotho, Africa, was too frail to come to Rome for the ceremony. AP

Intense bombing of Aleppo kills 20 Park ‘colluded’ in influence peddling, Korea prosecutor says B

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resident Park Geun-hye colluded with her former aides in an influence-peddling case that included undue pressure on South Korean corporations to raise tens of millions of dollars for foundations controlled by her friend, a South Korean prosecutor said on Sunday. P rosec utors h ave sec u red enough evidence to believe Park played a role when her friend, Choi Soon-sil, allegedly extracted money from some of the country’s biggest companies and gained access to classified information, including presidential speeches and evaluations of cabinet candidates, Lee Young-r yeol, the head of the Seoul Central District Prosecutors’ Office, said at a televised briefing. Lee gave the briefing after indicting Choi and two former presidential secretaries on charges, including the abuse of power. Park is the first South Korean president to be targeted as a suspect in a corruption investigation while in office. Park has apologized twice to the nation for consulting Choi, which sparked allegations that her friend meddled in state affairs extensively for personal gain. Park has asked for more time

Park Geun-hye

Bloomberg News

to prepare for her defense. Her approval rating has dropped to 5 percent, according to Gallup Korea.

Nationwide campaign

Hundreds of t housands of people have gathered near the presidential compound in the past two weeks to demand Park ’s resignation and arrest. Moon Jae-in, the front-runner in public opinion polls on presidential candidates, said last week he’ll run a nationwide campaign to push Park out. “Park should step down,” the People’s Party, the second-largest opposition party, said by text message. “Park’s collusion

and her status as a criminal suspect for the prosecutors’ investigation meet the requirement for impeachment.” If Park was to resign, an election would have to be held within 60 days. Despite the growing calls for her removal, Park has shown few signs she’d step down any time soon. This month she resumed official duties, including making appointments to government offices and naming new ambassadors. On Friday the presidential office reaffirmed plans for Park to attend a summit with China and Japan in Tok yo next month. Bloomberg News

EIRUT—Government bombardment of besieged rebelheld neighborhoods in Aleppo  killed at least 20 people on Saturday, the worst since air strikes resumed earlier this week, Syrian opposition activists said, as the US called for an end to the bombings. Saturday was the fifth day of renewed assaults by Syrian warplanes on eastern Aleppo districts, a rebel-held enclave of 275,000 people. The onslaught began on Tuesday, when Syria’s ally Russia announced its own offensive on the northern rebel-controlled Idlib province and Homs province in central Syria. The bombing on Saturday came after a day of air strikes that hit four hospitals in east Aleppo. A statement issued late on Friday by the opposition’s Aleppo Health Directorate said all hospitals in east Aleppo are out of service because of the bombing over the past days. “The intentional destruction of infrastructure for survival has made the besieged steadfast people, including children, elderly and men and women, without medical facilities to treat them,” the statement said. The Britain-based Syrian Observatory for Human Rights said not all hospitals in east Aleppo neighborhoods are out of service, but people are finding difficulties reaching them because of the intensity of the shelling. The White House, meanwhile, demanded an immediate halt to Syrian strikes on eastern Aleppo. White House National Security Adviser

Susan Rice said the US is tracking reports about health conditions. Speaking in Peru, Rice said the US condemns the “horrific attacks” against hospitals and aid workers “in the strongest possible terms.” Rice added there was “no excuse” for the attacks. The White House is putting the onus on Russia to lower the violence and help humanitarian aid get to besieged Syrians. It says President Barack Obama joins other leaders in Europe, and those gathering for an Asia economic summit in Peru over the weekend, in demanding a halt to bombings. O p p o s it i o n a c t i v i s t s s a i d Saturday’s death toll has been the worst since the aerial campaign resumed on Tuesday. Residents said hundreds of artillery shells and dozens of air strikes have hit the city, increasing the misery of its residents who have been suffering from lack of food and medicine because of the siege imposed by government forces and their allies in July. “Aleppo is being wiped out in front of the eyes of the world,” medical official Mohammed Abu Rajab said in an audio message to The Associated Press from inside the city. “It’s not only hospitals that are out of service. All liberated areas in Aleppo are out of service.” “Entire buildings have been completely destroyed,” Abu Rajab said. The Observatory said Syrian government warplanes and artillery struck more than 20 neighborhoods in east Aleppo killing 27 people and

wounding many others. The Aleppo Media Council, an activist collective, said 20 people, including children, were killed in Saturday’s violence in the country’s largest city and former commercial center. Pro-government media, meanwhile, reported rebel shelling on government-held parts of the city, saying they killed two and wounded others. The latest deaths raise to more than 130 the number of people killed in northern Syria since Tuesday. The UN said in a statement released in Damascus it “is extremely saddened and appalled by the recent escalation in fighting” in several parts of Syria, calling on all sides to cease indiscriminate attacks on civilians and civilian infrastructures. It said the UN stands ready to assist people in east Aleppo “as soon as access is granted by all parties.” It said it has shared with all parties to the conflict in  Aleppo  and concerned member-states a detailed humanitarian plan to provide urgently needed assistance to the inhabitants of east Aleppo, and conduct medical evacuations for the ill and injured” confirmed both Syria Humanitarian Coordinator Ali Al-Za’tari and the Regional Humanitarian Coordinator for the Syria Crisis Kevin Kennedy. “It is imperative all parties agree to the plan and allow us to secure immediate, safe and unimpeded access to provide relief to those most in need in east Aleppo, but equally in all other parts of Syria,” they said. AP


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Top Obama military official under fire

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ASHINGTON—A top US military official in consideration to be Donald J. Trump’s director of national intelligence has been recommended to be removed from his command in the Obama administration. The recommendation to relieve Adm. Michael S. Rogers from his post as head of the National Security Agency (NSA) was made to the White House last month by Defense Secretary Ashton Carter and Director of National Intelligence James Clapper, according to US officials, who were not authorized to speak publicly on the matter. Carter and Clapper have been critical of Rogers’s performance at the NSA, particularly after the agency came under fire in October when a contractor was found with a trove of sensitive digital files related to its surveillance programs. The incident took place only three years after Edward Snowden distributed more than 1 million classified documents about the agency’s secret surveillance programs. Carter has also been privately critical of Rogers, who is also in charge of the US military’s Cyber Command, for not responding faster to the technology-savvy Islamic State and its sprawling propaganda operation, officials said. Carter and Clapper believe there should no longer be one person in charge of Cyber Command and NSA, a stance that has complicated the White House process of naming a Rogers successor, officials said. The White House, Pentagon and Office of Director of National Intelligence declined to comment on the matter. The recommendation to remove Rogers from leading the NSA was first disclosed on Saturday by The Washington Post. Rogers met with Trump on Friday at Trump Tower in New York. He is said to be in the running to succeed Clapper in heading the Office of Director of National Intelligence, an umbrella agency that oversees and coordinates among the nation’s 17 spy agencies. Rogers, 57, is a Navy cryptologist who took over at the NSA as it was reeling from the Snowden leaks, which cost the agency hundreds of millions of dollars and resulted in the scaling back of some of its domestic spying operations. Then last month, another agency contractor, Harold T. Martin III, was charged with stealing even more classified intelligence documents and digital material concerning highly classified software and computer codes that the NSA uses to spy on computer networks in other countries. Martin was secretly arrested in August after an Federal Bureau of Investigation search of his vehicle and residence found “hard copy documents and digital information stored on various devices,” including “classified documents obtained from sensitive intelligence” from 2014, according to an unsealed Justice Department complaint. The case renewed concerns about security at the agency and raised questions about the handling of the nation’s most sensitive cyber secrets. Like Snowden, Martin worked as a contractor for Booz Allen Hamilton, a Virginia-based business that provides management and technology consulting services to US defense and intelligence agencies. TNS

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Trump brags: Candidates for his officials are ‘really talented people’

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resident-elect Donald J. Trump emerged from hours of meetings at his New Jersey golf resort, declaring that the day’s talks were “really good” and that his candidates are “really talented people” who would make good on his campaign pledge to make America great again.

Responding to a CNN report that retired Marine General James Mattis is now the front-runner to become defense secretary, Trump said merely, “Well, we think he’s a great guy. He is some great man.” Mattis was at the resort for more than an hour on Saturday. Trump was having dinner with Patrick Soon-Shiong, an aide said. Soon-Shiong became a billionaire selling two drug companies and owns a stake in the Los Angeles Lakers National Basketball Association basketball team. Mitt Romney and Steve Mnuchin earlier led a parade of visitors to the clubhouse in Bedminster as the president-elect continues to assemble his administration. Romney, the 2012 Republican presidential nominee and a fierce critic of Trump for most of the 2016 election season, is now said to be on the short list to become secretary of state. Mnuchin, a close ally who was the finance chairman of Trump’s campaign, may be under consideration for Treasury secretary. The former governor of Massachusetts, Romney spent about an hour with Trump and Vice Presidentelect Mike Pence. “We had a far-reaching conversation with regard to the various theaters of the world of interest to the

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The number of members of President-elect Donald J. Trump’s transition team

United States, of real significance,” Romney said upon emerging. He didn’t take questions.

Upscale resort

Trump, 70, decamped from his midtown Manhattan penthouse on Friday afternoon to the upscale club set in Bedminster, in New Jersey’s horse country, about 80 kilometers to the west. The course sits on the former estate of automaker John DeLorean. It features two 18-hole courses designed by renowned architect Tom Fazio, and is scheduled to host the 2017 US Women’s Open tournament. Besides Romney, Trump’s short list to become the nation’s top diplomat is said to include former New York Mayor Rudy Giuliani, Sen. Bob Corker from Tennessee, John Bolton, a former US ambassador to the UN, and Nikki Haley, the governor of South Carolina. Mnuchin is one of 16 members of the transition team’s executive

President-elect Donald J. Trump and Mitt Romney shake hands, as Romney leaves Trump National Golf Club Bedminster in Bedminster, New Jersey, on Saturday. AP/Carolyn Kaster

committee, along with the presidentelect’s son Eric Trump, who also attended on Saturday. Sean Spicer, spokesman for the Trump transition team, told reporters that it was “very possible we’ll see an additional announcement” in the national security area on Saturday. The director of national intelligence and secretary of defense are two notable jobs not filled to date.

National security

ON Friday Trump tapped three campaign loyalists, whose positions lie outside the conservative mainstream, to positions that could drive the nation’s immigration and intelligence agenda. Alabama Sen. Jeff Sessions was

nominated for attorney general, Rep. Mike Pompeo for CIA director, and retired Lt. Gen. Michael Flynn as national security adviser. Contentious hearings are possible in the Senate for Sessions and Pompeo; Flynn’s appointment is not subject to confirmation. President Barack Obama, speaking in Lima on Saturday while attending the Asia-Pacific Economic Cooperation meeting, said Trump’s administration shouldn’t be prejudged. At a town hall meeting, Obama urged the world “not to make immediate judgments, but give this new president-elect a chance” to put his team together. Candidates for other administration posts arrived in Bedminster

on Saturday, including Betsy DeVos, a major Republican donor, and educator Michelle Rhee. Both are said to be under consideration as education secretary. Billionaire investor Wilbur Ross, who may be on the short list for commerce secretary, will sit down with Trump on Sunday. Others meeting with Trump on Sunday, according to the transition team, include Rep. Cathy McMorris Rodgers of Washington, the only woman currently in a Republican congressional leadership post; T. W. Shannon, former speaker of the Oklahoma House of Representatives; Giuliani; and New Jersey Gov. Chris Christie. Bloomberg News

Best weather satellite ever rockets into space Train derails in north India, killing at least C 90 and trapping others

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UCKNOW, India—Rescue workers used gas cutters to pull out survivors after 14 coaches of a passenger train rolled off the track, killing at least 90 people in northern India early Sunday, the police said. The bodies were retrieved from the mangled coaches that fell on the side after the train derailed around 3:10 a.m., jolting awake passengers who had settled in for the overnight journey. More than 150 were injured as some coaches crumpled when they crashed into others, trapping hundreds of people inside. “There are people trapped inside. We are being very careful in using the gas cutters,” said Daljeet Chaudhary, a director general of police. He said the toll was likely to rise as rescue workers were yet to gain access to some of the worst damaged coaches. The derailment occurred near Pukhrayan, a village near the industrial city of Kanpur. Rescuers used gas cutters to open the derailed coaches to reach those trapped inside, while cranes were deployed to lift the coaches from the tracks. Medical teams were providing first aid near the site, while the more seriously injured were moved to hospitals in Kanpur, Chaudhary said. At least two dozen suffered serious injuries, he said. Passenger Satish Kumar said the train was traveling at normal speed when it stopped suddenly.

“It restarted, and then we heard a crash. When we came out of the train, we saw a few coaches had derailed,” said Kumar, whose coach remained standing on the track. It was not immediately clear what caused the coaches to derail. Prime Minister Narendra Modi expressed his concern over the derailment. “Anguished beyond words on the loss of lives due to the derailing of the Patna-Indore express. My thoughts are with the bereaved families,” Modi posted on his Twitter account. Kanpur is a major railway junction and hundreds of trains pass through it every day. Several trains using the line have been diverted to other routes, Anil Saxena, spokesman for Indian Railways, said in New Delhi. Accidents are relatively common on India’s sprawling rail network, which is one of the world’s largest but lacks modern signaling and communication systems. Most crashes are blamed on poor maintenance and human error. Trains are the popular mode of transport for millions of Indians and around 23 million passengers use India’s vast railway network every day. The worst train accident occurred in 1981 near Saharsa Bihar when a passenger train fell into the Baghmati River, killing nearly 800 people. Several other major train crashes have claimed hundreds of lives each since then. AP

APE CANAVERAL, Florida— The most advanced weather satellite ever built rocketed into space on Saturday night, part of an $11-billion effort to revolutionize forecasting and save lives. This new Geostationary Operational Environmental Satellite (GOES)-R spacecraft will track US weather as never before: hurricanes, tornadoes, flooding, volcanic ash clouds, wildfires, lightning storms and even solar flares. Indeed, about 50 TV meteorologists from around the country converged on the launch site—including NBC’s Al Roker— along with 8,000 space program workers and guests. “What’s so exciting is that we’re going to be getting more data, more often, much more detailed, higher resolution,” Roker said. In the case of tornadoes, “if we can give people another 10, 15, 20 minutes, we’re talking about lives being saved.” Think superhero speed and accuracy for forecasting. Super highdefinition TV, versus black and white. “Really a quantum leap above any satellite NOAA [National Oceanic and Atmospheric Administration] has ever flown,” said Stephen Volz, NOAA director of satellites. “For the American public, that will mean faster, more accurate weather forecasts and warnings,” Volz said earlier in the week. “That also will mean more lives saved and better environmental intelligence” for government officials responsible for hurricane and other evacuations. Airline passengers also stand to benefit, as do rocket launch teams. Improved forecasting will help pilots avoid bad weather and help rocket scientists know when to call off a

A United Launch Alliance Atlas V rocket carries GOES-R spacecraft for National Aeronautics and Space Administration and National Oceanic and Atmospheric Administration lifting off from Space Launch Complex-41 at 6:42 p.m. EST at Cape Canaveral Air Force Station, Florida, on Saturday. United Launch Alliance via AP

launch. The National Aeronautics and Space Administration (Nasa) declared success three-and-a-half hours after liftoff, following separation from the upper stage. The first in a series of four hightech satellites, GOES-R hitched a ride on an unmanned Atlas V rocket, delayed an hour by rocket and other problems. NOAA teamed up with Nasa for the mission. The satellite—valued by NOAA at $1 billion—is aiming for a 22,300-mile-high equatorial orbit. There, it will join three aging spacecraft with 40-year-old technology, and become known as GOES-16. After months of testing, this newest satellite will take over for one of the older ones. The second satellite in the series will follow in 2018. All told, the series should stretch to 2036. GOES was first launched in 1975. GOES-R’s premier imager— one of six science instruments—will

offer three times as many channels as the existing system, four times the resolution and five times the scan speed, said NOAA Program Director Greg Mandt. A similar imager is also flying on a Japanese weather satellite. Typically, it will churn out full images of the Western Hemisphere every 15 minutes and the continental United States every five minutes. Specific storm regions will be updated every 30 seconds. Forecasters will get pictures “like they’ve never seen before,” Mandt promised. A first-of-its-kind lightning mapper, meanwhile, will take 500 snapshots a second. This next-generation GOES program—$11 billion in all—includes four satellites, an extensive land system of satellite dishes and other equipment, and new methods for crunching the massive, nonstop stream of expected data. AP


Science Monday

A12 Monday, November 21, 2016

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

Does the moon influence quakes? Scientists study the relationship Story & photo by Stephanie Tumampos

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Special to the BusinessMirror

he Earth has been around for roughly 4.6 billion years, yet its various phenomena have left many scientists puzzled.

For one, earthquakes have been of great interest for scientists, as various evidence of forces that have triggered these natural occurrences are slowly being uncovered throughout time and based on data collected. This past week a deadly 7.8-magnitude earthquake hit New Zealand and has caused a reported 2-meter lift on its seabed with a tsunami warning. According to New Zealand’s official source of geological hazard information, GeoNet, “multiple faults have ruptured,” indicating a slip of the Kekerengu fault, a new fault at Waipapa Bay, a movement on the Hope fault and the Hundalee fault. Coincidentally, the supermoon also occurred on the same day the earthquake happened. It is yet the biggest supermoon in 68 years. For Filipinos, the supermoon was gazed upon the night of November 14, while in New Zealand, its peak appeared after midnight of November 15. This supermoon is the closest encounter between the moon and the Earth with a distance of 356,509 kilometers. It will not be as close until November 25, 2034, although other supermoons will come in between these years. The supermoon last Monday appeared as much as 14 percent larger in the sky and 30 percent brighter to human vision.

Tidal waves, stresses

Nonetheless, the moon causes stronger tidal waves and stresses. According to Filipino astrophysicist Dr. Rogel Mari Sese, “Earth’s tides are caused by the gravitational forces of the sun and moon.” In an interview with the BusinessMirror, he said: “Since the force of the sun’s gravity is smaller compared to the moon’s, the moon causes a stronger disruption of the waters on Earth, hence, the tides as its effect.” Although it has long been debated if the effect of the moon’s gravity on Earth, such as tidal stresses, can cause stronger earthquakes, some scientists were curious enough to investigate on whether the tidal stresses caused by the moon can affect more than just the Earth’s waters. In a recently published article from the journal Nature Geoscience written by scientists Satoshi Ide, Suguru Yabe and Yoshiyuki Tanaka, entitled “Earthquake potential revealed by tidal inf luence on earthquake sizefrequency statistics,” they concluded that large earthquakes are more likely to happen when tidal stress is high. Ide and Yabe, from the Department of Earth and Planetary Science, and Tanaka from the Earthquake Research Institute, all from the University

of Tokyo, gathered data from global, Japanese and Californian earthquake catalogues. Based on their research, very large earthquakes occur near the moments of maximum tidal stress caused by the moon. In their research, they found out that earthquakes were more e v id e nt w he n t he t id e s a re stronger and create pressure. “We find that very large earthquakes, including the 2004 Sumatran, 2010 Maule earthquake in

Chile and the 2011 Tohoku-Oki earthquake in Japan, tend to occur near the time of maximum tidal stress amplitude,” the published paper said. The 2004 Sumatran earthquake was recorded at 9.1 magnitude, 2010 Maule earthquake had an 8.8 magnitude and the 2011 TohokuOki earthquake in Japan also ha d a 9.1 magnitude. All of these earthquakes and their tidal stresses were carefully investigated 30 days before and

after the tremors. “In particular, a clear causal relationship between small earthquakes and the phase of tidal stress is elusive,” the team’s paper said. However, they still concluded based on their outputs that the relationship is reasonable. “This suggests that the probability of a tiny rock failure expanding to a gigantic rupture increases with increasing tidal stress levels.” Although the research might

prove to be rational, it is not reliable for predicting such events. According to New Zealand’s GeoNet web site, “In large groups, earthquakes exhibit slight associations with lunar cycles, but this is not reliable for forecasting.” It said that New Zealand has two tides a day and there is no clear connection in location. “The occurrence of the full moon around the globe does not allow us to say how big, when and where any earthquake might be.”

Quake-lifted seabed hurts town reliant on whales and lobsters

T Dr. Adolfo Roitman presents a part of the Isaiah Scroll, one of the Dead Sea Scrolls, inside the vault of the Shrine of the Book building at the Israel Museum in Jerusalem in this September 26, 2011, photo. AP/Sebastian Scheiner

Israel to launch expedition to find more Dead Sea Scrolls

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ERUSALEM—Israel is embarking on a major archaeological expedition to find yet undiscovered Dead Sea Scrolls, an Israeli antiquities official said on Monday. Amir Ganor of the Israel Antiquities Authority said a government research team will spend the next three years surveying hundreds of caves in the Judean Desert near the Dead Sea, the arid region where the Dead Sea Scrolls, the world’s oldest biblical manuscripts, were preserved for thousands of years and discovered in 1947. The collection is considered the crown jewel of Israeli antiquities. In a move that is bound to stir controversy, the researchers may also excavate Dead Sea-area caves in the West Bank, Ganor said. Israel captured the West Bank in the 1967 Mideast War, and the Palestinians want the territory to establish an independent state. Ganor discussed details of the project with The Associated Press ahead of an official announcement. The expedition will begin in December and will be funded by the

Israeli prime minister’s office, Ganor said. A spokesman for Prime Minister Benjamin Netanyahu did not immediately respond to a request for comment. The upcoming expedition will be the first large-scale archaeological survey of the area since Operation Scroll, an effort in 1993 to find any remaining Dead Sea Scrolls hidden in an area of the West Bank before Israel transferred partial control of the area to the Palestinian Authority. No scrolls were found in that undertaking. According to Ganor, archaeologists also hope to find other antiquities dating back to as early as 5,000 years ago, as well as from the 1st-century Jewish-Roman war and the 2nd-century Bar Kochba revolt, when Jewish fighters battling the Roman army sought refuge in the desert. Last summer Israel carried out a threeweek excavation of the so-called Cave of the Skulls in the Judean Desert, after catching a group of six Palestinian men digging illegally at the site in 2014. The Palestinians were believed to be digging for more Dead Sea Scrolls. AP

he massive earthquake that struck New Zealand this week has lifted the seabed around the South Island town of Kaikoura by several meters, putting the local fishing industry and whalewatching tourist operation at risk. Shellfish delicacies, such as abalone and lobster, which live on submerged rocks and reefs, have been hoisted out of the sea by the 7.8-magnitude quake and will need to be relocated, the Ministry for Primary Industries said on Wednesday. Boats operated by Whale Watch Kaikoura Ltd. are now largely stranded in their marina due to the reduced water depth. The raised seabed is another blow for Kaikoura, which relies on tourism and fisheries for its economic survival. The picturesque town of about 2,000 people, whose name translates from Maori as “meal-oflobster,” has been cut off after the quake-triggered huge landslides over coastal roads and railway tracks that will take months to repair. While an inland road will soon be re-opened, Kaikoura is likely to experience “a significant downturn in both international and domestic visitor arrivals in the short to medium term,” said Caroline Orchiston from the Centre for Sustainability at University of Otago. “This will continue until the threat of aftershocks subsides and tourism infrastructure is back in place.”

Feeding whales

Whale Watch operates four catamarans capable of taking 100,000

Three cows are stranded on an island of grass in a paddock that had been ripped apart following an earthquake near Kaikoura, New Zealand, on November 14. Newshub via AP

2,000

The number of residents of Kaikoura, a South Island town in New Zealand

people a year to the deep waters off the Kaikoura coast, where whales feed in the nutrient-rich currents. Other operators offer chances to swim with dolphins and mingle with seals, making the town an exciting destination for tourists. An estimated 1,100 tourists were in Kaikoura, which is framed by snow-capped mountains on one

side and the sea on the other, when the earthquake hit early on Monday. The seismic rupture, initially measured as 7.5 magnitude, was centered in the north of the South Island, about 100 kilometers inland from Kaikoura, where one of its two fatalities occurred. US, Australian and Canadian warships are helping the New Zealand military with an air and sea evacuation of the town’s stranded guests, who were fed lobster during their ordeal donated by the local Maori tribe. Tour operators in Kaikoura are concerned about the busy summer season approaching, Prime Minister John Key told parliament after visiting the town earlier on Wednesday. Whale Watch has indicated it

will only be able to operate for two hours a day because of the impact of the raised seabed on its marina, he said. The solution may be dredging to deepen the channel, Key said. Government officials are also working with the Kaikoura community to support the rebuilding of fisheries. Professor Jeff Shima, director of the Coastal Ecology Lab at Victoria University in Wellington, said the images of uplifted rocky reefs covered with dying abalone, lobster and seaweeds were striking. “The extent of this uplift is not yet clear, but without question the affected areas will experience significant changes in the quantity and composition of marine life,” he said. “Recovery could take years.” Bloomberg News


Green Monday BusinessMirror

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

BusinessMirror

Monday, November 21, 2016 A13

WWF celebrates 20 years with ‘Partners’ Night’

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n upland farmer who now has access to drinking water, a whale-shark guide who was able to send two of his children to college and a boatbuilder who helped rebuild boats in Leyte. They were just some of the faces featured by the World Wide Fund for Nature (W WF)-Philippines when it gave recognition to its partners in a “Partners’ Night” during its 20th anniversary celebration at a hotel in Makati City on November 15. “Our work has taken us far and wide over the past 20 years— through the Turtle Islands in Tawi-Tawi, the sugarcane fields of Negros—even international battlegrounds, like COP 22 [22nd Conference of Parties], which even now is happening in Morocco,” WWF-Philippines President and CEO Joel Palma said. “Through it all, our goal has always transcended mere conservation. We don’t just protect a coral reef—we want to make it healthy enough so fishers can

fish there forever. We work to positively transform lives and create a future where people live in harmony with nature.” For h i s pa r t , W W F -Ph i l ip pi nes C h a i r m a n Au re l io Montinola III sa id: “Our cor porate, p u b l i c s e c t or, c i v i l s o c ie t y, t he med i a a nd ac adem ic a l l ies h ave he lped en su re t h at ou r core t h r u st s — fo o d a nd w a ter sec u r it y, c l i m ate - c h a nge solut ion s a nd s pec ies con ser v at ion — cont i nue to de l ive r lon g - t e r m s olut ion s i n l i ne w it h moder n t i mes…. A lone, we for m i nd iv idu a l d rops — but col lec t ive ly, we h ave t he st reng t h of a ra g i ng r iver.” T he W W F-Ph i l ippines h a s been conserving the country’s natural resources, protecting endangered species and alleviating

Members of the family of slain whale-shark guide Joel Briones (center, third to sixth) receive the Hero of the Environment award from WWF-Philippines officials (from left) National Advisory Council Chairman Vince Perez, WWFPhilippines Chairman Gigi Montinola and President Joel Palma. Roy Domingo

Angelique Songco (second from left) receives the Hero of the Environment award from WWF-Philippines officials. Also in photo are (from left) National Advisory Council Chairman Vince Perez, Chairman Gigi Montinola and President Joel Palma. Roy Domingo

poverty since 1996. Among its projects is the transformation of Donsol town in Sorsogon from a sleepy fishing village to a bustling center for wild whale-shark ecotourism, where many residents rose from poverty because of the influx of tourists. The environmental conservation organization works with many allies to conserve the country’s most significant coral reefs and forests, such as the Tubbataha Reefs in Palawan and the Sierra Madre mountain range covering 10 provinces in Luzon. The WWF holds the Earth Hour

National Geographic Channel Philippines, Samsung Electronics Philippines Corp., Royal Caribbean Cruises Ltd. Alternergy Wind One Corp., PetroWind Energy Inc. and Trans Asia Renewable Energy Corp./Phinma Energy. Also recognized WWF-Philippines partners were Arthaland Corp., Banco de Oro Unibank, BPI Foundation, Cebu Pacific Air Inc., Coca-Cola Femsa, Coca-Cola Foundation, Costa del hamilo, Eagle Broadcasting Corp., Far Eastern University, Norwegian Maritime Foundation of the Phils. Inc., Pascual Laboratories Inc.,

every last Saturday of March— the world’s largest mass action to fight climate change. During the celebration, the WWF-Philippines feted “Heroes of the Env ironment”—W W FPhilippines Founder Dr. Celso Roque, Tubbataha Reefs guardian Angelique Songco and slain whale-shark guide Joel Briones. Bel iev ing t hat t he W W F ’s strength “ lies in its ability to convence industry leaders and d r ive c h a nge ac ross v a r iou s sectors,” it recognized its “outstanding” corporate partners, led by Century Pacific Food Inc.,

Philips, Republic Cement, Smart Communications Inc., SunLife Financial Philippines Foundation, The Hong Kong and Shanghai Banking Corp., Yuchengco Group of Cos., Griegstar Phils. and United States Agency for International Development. T he BusinessMir ror was also recognized with a certificate of appreciation “for its continuous support in helping the WWF build a future where humans live in harmony with nature.” The WWF-Philippines National Ambassadors Marc Nelson and Iza Calzado hosted the event.

Air pollution is top killer globally and major cause of climate change

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ENANG—New research is showing that air pollution is a powerful silent killer, causing 6.5 million worldwide deaths, as well as being the major cause of climate change.    Air pollution has emerged as a leading cause of deaths and serious ailments in the world. Emissions that cause air pollution and are greenhouse gases are also the main factor causing climate change. Therefore, drastically reducing air pollution should now be treated as a top priority. The seriousness of this problem was highlighted by the heavy smog that enveloped New Delhi for days at the beginning of November, forcing the government to declare an emergency, schools to be closed and a ban on construction work for several days. The level of the harmful PM2.5 pollutants had almost reached 1,000 at some times in the Indian capital city, far above the safety level of 60.

Kills more than road accidents

Recent research shows that air pollution is the No. 1 environmental cause of human deaths and kills more people annually worldwide than road accidents, violence, fires and wars combined. This “silent killer” is not as dramatic or visible as car crashes, murders, terrorist attacks or natural disasters, but it is, nevertheless, even more dangerous, as it contaminates vital organs, causing serious diseases and deaths to many millions of people. Altogether, 6.5 million people worldwide are estimated by the World Health Organization (WHO) to have died prematurely in 2012 because of air pollution. This means that, of the 56 million deaths worldwide in 2012, 11.6 percent, or one in nine, were attributable to air pollution. In comparison, there were 5 million deaths from all injuries, including from road accidents (1.3 million deaths), falls, fires and war in 2012, according to WHO data. Indeed, air pollution may have become one of the top killers. Tobacco use, usually described as the world’s leading preventable cause of death, is responsible for nearly 6 million deaths annually, or around 10 percent of total deaths. Air pollution may have over-

is a measure of the extent of premature death compared to the normal expected life span. Of the total years of life lost, 26 percent was due to lung cancer, 17 percent to stroke, 17 percent to acute respiratory disease, 16 percent to ischaemic heart disease and 8 percent to chronic obstructive pulmonary disease. The WHO report, “Ambient air pollution: A global assessment of exposure and burden of disease”, was based on satellite data, airtransport models and groundstation monitors for more than 3,000 rural and urban locations. The study does not include indoor or household air pollution, which may be even more dangerous than outdoor air pollution.

taken it as the world’s leading cause of death. T he W HO est i m ates t h at there are 4.3 million deaths attributable to indoor pollution and another 3.7 million deaths to outdoor pollution. Because some deaths may be due to both outdoor and indoor pollution, it is not possible to add up the two figures to obtain the total deaths. Thus, in its latest estimate in September 2016, the WHO has explained that there were 6.5 million deaths from outdoor and indoor air pollution combined in 2012.

Young children most vulnerable

Young children are among the most vulnerable to the effects of air pollution. A new United Nations Children’s Fund study released on October 31 found air pollution is a major contributing factor in the deaths of around 600,000 children under 5 every year, and that around 2 billion children live in areas where outdoor air pollution exceeded the WHO air-quality guidelines. Besides its threat to human lives and health, air pollution is also the major cause of climate change, as it is linked to much of the greenhouse-gas emissions. The Paris Agreement of the UN Climate Change Conference that came into force on November 10 aims to limit the rise of the average global temperature to 2 degrees Celsius, or 1.5˚C above the preindustrial era levels. At the current rate of global emissions, and even at rates reduced by the Paris Agreement commitments, global warming will far exceed this limit, and, thus, the world faces potentially catastrophic effects to the global environment, food supplies and, also, human health. Thus, air pollution ranks as the biggest threat to both human health and the environment. Reducing this pollution should, therefore, be at the top of the global agenda, as well as national agendas.

Outdoor air pollution

At the end of September, the WHO, for the first time, published country-by-country details about the extent of outdoor air pollution and the deaths associated with it. The study shows that 3 million premature deaths worldwide were linked to ambient or outdoor air

Indoor air pollution Indian tourists take selfies against the war memorial India Gate engulfed in smog in New Delhi, India. The Delhi government has ordered that all city schools be shut, construction activity halted and all roads be doused with water, as crippling air pollution has engulfed the Indian capital. The city, one of the world’s dirtiest, has seen the levels of PM2.5 soar to over 900 microgram per cubic meter on November 5, more than 90 times the level considered safe by the World Health Organization and 15 times the Indian government’s norms. AP/Manish Swarup

6.5M

The number of people worldwide who died owing to air pollution in 2012

pollution in 2012. Of this, 88 percent of the deaths were in developing countries and two out of three occurred in the Southeast Asia and the Western Pacific regions. Two countries alone accounted for more than half of the total deaths—China with 1.03 million and India with 621,138. Other high-numbered countries include Russia (140,851), I ndonesi a (61,792), U k ra i ne (54,507), Egypt (43,531), Nigeria (46,750), Pakistan (59,241), the United States (38,043), Bangladesh (37,449), Turkey (32,668), Japan (30,790), the Philippines (28,696), Vietnam (27,340), Poland (26,589), Iran (26,267), Brazil (26,241) and Germany (26,160). Most of the deaths attributable to outdoor air pollution were caused by noncommunicable diseases, especially ischaemic heart diseases (36 percent of the total

deaths), strokes (36 percent), lung cancer (14 percent), chronic obstructive pulmonary disease (8 percent) and acute lower respiratory infections (8 percent).

9 of 10 people exposed to unsafe air

The situation is truly pervasive: 92 percent of the world’s population are exposed to the dangers of unsafe air quality, as they live in places that do not meet the WHO health standard for outdoor air quality. The world as a whole has an annual median exposure to outdoor mean annual concentration of PM2.5 of 39 microgram per cubic meter. This is four times above the WHO’s guideline limit of 10 microgram per cubic meter for PM2.5. The regions with the highest outdoor air-pollution rates are Easter n Mediterranean highincome countr ies (91 micro gram per cubic meter of PM2.5), Eastern Mediterranean low- and middle-income countries (55), Southeast Asia (55), Western Pacific low and middle income countries (49) and Africa (32). Countries with high incidence of outdoor air pollution include Saudi Arabia (108 microgram per cubic meter of PM2.5), Qatar (103), Egypt (93), Kuwait (75), Bangladesh (84), Cameroon (65),

Mauritania (65), the United Arab Emirates (64), India (62), Libya (61), Pakistan (60), Bahrain (60) and China (54). The PM2.5 level is the annual median concentration of particulate matter of a diameter less than 2.5 micrometers. PM2.5 includes very fine (and, thus, the most damaging) particles of pollutants, such as sulphate, nitrates, ammonia, sodium chloride, black carbon and mineral dust, which penetrate and lodge deep inside the lungs and in the cardiovascular system, posing the greatest health risks of developing cardiovascular and respiratory diseases and lung cancer. Air quality is normally measured in terms of daily or annual mean concentrations of PM10, or PM2.5 particles (with diameter of 10 or 2.5 micrograms) per cubic meter of air volume. The WHO guidelines for particulate matter (PM) outdoor pollution is an annual mean of 10 microgram per cubic meter for particles below the size of 2.5 microns in diameter, and 20 microgram per cubic meter for particles below 10 microns in size. The world also suffered 84.9 million years of life lost in 2012, attributable to outdoor air pollution, according to the WHO report. Years of life lost

Worldwide, 4.3 million people die annually from indoor air pollution, mainly from stroke (34 percent), ischaemic heart disease (26 percent), chronic obstructive pulmonary disease (22 percent), pneumonia (12 percent) and lung cancer (6 percent). The main form of the deadly household pollution is the use of solid fuels for cooking and heating. Nearly 3 billion poor people rely on wood, animal dung, charcoal, crop wastes and coal, which are burned in highly polluting simple stoves or open fires. The resulting pollution, which includes small soot particles that penetrate deep into the lungs, especially affects women and children who spend a lot of time near the kitchen or hearth. In poorly ventilated homes, indoor smoke can be 100 times higher than the acceptable levels for fine particles, according to the WHO. The use of kerosene lamps for lighting also exposes the families to very high levels of fine particles. The emissions of black carbon and methane from the stoves also contribute to outdoor air pollution and increase climate change, as both are powerful greenhouse gases. The WHO has new indoor airquality guidelines for household fuel combustion and recommendations on types of fuels and technologies to protect health, in addition to guidelines on specific indoor pollutants. It will also do a study of indoor pollution and, when the figures are published, they will reveal the full problems caused by air pollution. IPS


A14 Monday, November 21, 2016 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

It’s simple: Lower taxes, more growth

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he headlines about the latest Pulse Asia Research Inc. survey concentrated on the approval ratings of the administration. However, the “Most Urgent National Concerns” were about the economy. Improving workers’ pay, creating more jobs and controlling inflation were the top 3 in all areas of the nation and across all economic groups.

The answer from the government now and before to questions about greater economic growth and job creation is that public spending must be increased. While it is true that the Philippines needs to boost its infrastructure, requiring more public spending, is that genuinely a big help to economic growth and job creation? One important way to measure the economic benefits of spending—both public and private—is the “multiplier effect”; “an increase in spending producing an increase in national income and consumption greater than the initial amount spent”. How much “bang for the buck” is generated over time? Which is more positive, government or private spending? Economists, especially on the government side, say a reduction of taxes that leaves more money in private hands gives a smaller multiplier, because the public does not spend all the extra money, because some of that reduction in taxes is saved. That is sort of a silly argument, since people will eventually spend their savings in the future, when they accumulate enough to buy a house or open a business, for example. However, ordinary people do not spend to build “bridges to nowhere” as the government often does. Further, it is uncommon to find ordinary people spending P50 million on private building ventures that collapse, as just happened with the Naga River Revetment Project. While government economic models favor government spending to tax reduction, the real-world examples show something different. In 1964 individual income-tax rates in the US were cut across the board by approximately 20 percent. In addition to individual incometax cuts, corporate-tax rates were slightly reduced. The economic growth virtually doubled from about 4 percent to about 8 percent in three years. The Ronald Reagan tax cuts, which were called “trickledown economics,” reduced the top rate from 70 percent to 28 percent between 1983 and 1990. The GDP growth soared from negative 3 percent to a positive 8-percent growth, as the tax rate decreases were implemented. Conversely, when President Bill Clinton raised the top tax rate, economic growth stagnated in his first term of office. While job creation was good during that period, real wages also went sideways. During Clinton’s second term, some tax rates were reduced, particularly capital-gains tax on profitable investments. Economic growth accelerated by one percentage point to 4.2 percent per year. Real wages made their biggest advance since the implementation of the Reagan tax-rate reductions in the mid 1980s. There must be a balance between government-spending increases and tax reduction, especially in an economy like the Philippines. But to believe that government spending is the driver of economic growth is a myth and foolish. The evidence shows that lower taxes, properly implemented, create more economic prosperity. Since 2005

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The Philippines in the Apec summit Atty. Jose Ferdinand M. Rojas II

RISING SUN

O

N November 17 President Duterte arrived in Lima, Peru, where the Asia-Pacific Economic Cooperation (Apec) summit is being held. Reports say he will be meeting with Russian President Vladimir Putin and China’s Xi Jinping.

The Philippines is one of the 21 Pacific Rim countries participating in Apec summit, an economic, trade and investment forum. We are one of the founding members of Apec when it was established in 1989. Apec has effectively reduced tariffs and other trade barriers in the Asia Pacific. All of its activities are being done to improve the economies of the nations involved, energize trade and increase exports. US President Barack Obama, Russia’s Putin and China’s President Xi Jinping were scheduled to address the summit. Japanese Prime

Minister Shinzo Abe is also one of the leaders present at the meeting. Apec is relevant and powerful because the member-economies of Apec account for approximately 40 percent of the world’s population, 60 percent of the global economy and 44 percent of world trade. And for this particular summit, the leaders and participants are anticipating changes because of recent developments: the election of billionaire Donald Trump as America’s president, and the perceived emergence of Russia and China as the region’s new economic powers.

It is expected that the world leaders will be discussing their freetrade agreements, which are facing peril amid Trump’s pronouncements against international free trade. China is, in fact, proposing an Apec-wide Free Trade Area of the Asia-Pacific (FTAAP) and a 16-member Regional Comprehensive Economic Partnership (RCEP), which includes India but not America. It is, therefore, very important for the Philippines to study its position and strategize to meet the challenges that these changes will surely bring about. nnn

On the home front, the National Economic and Development Authority (Neda) released on November 17 its statement on the third-quarter performance of the Philippine economy. The Philippine Statistics Authority (PSA) declared that the country’s economy in the third part of 2016 grew by 7.1 percent, the fastest in Asia and higher than the increase in the second quarter of this year. The target growth of 6 percent to 7 percent this year will definitely be reached, according to the Neda.

Investments powered this economic growth, according to the data presented. Consumer confidence was high, increasing household and private consumption. The other factors responsible for the growth in consumption is the low inflation, low interest rates, better labor-market conditions and the steady growth in dollar remittances from overseas Filipino workers. Government programs, like the Pantawid Pamilyang Pilipino Program (4Ps), is also seen boosting consumer demand. Exports rose 7.8 percent and the agriculture sector has started to show signs of recovery, growing by 2.9 percent and finally breaking five consecutive quarters of decline. Growth of our industries was recorded at 8.6 percent, with manufacturing and construction leading the third-quarter performance. The utilities industry was steady, while services was at 6.9percent. Overall, it was a good quarter that bodes well for the country’s holiday celebrations and the arrival of a New Year. We are hoping that the coming year will be even better for the country and all Filipino families.

This bank needs a female, Northern Brexiteer

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By Mark Gilbert | Bloomberg View

he Bank of England is advertising for a new deputy governor to start next year. As you’d expect, the job posting lists several desired features aspiring candidates should have. But let’s hope the winning applicant possesses some attributes not listed in the official job description; ones who would make the central bank’s monetary-policy committee more representative of the community it serves. That might also help restore public faith in a valuable and somewhat beleaguered institution.

Research suggests managers typically prefer to hire people who remind them of themselves. So there’s a risk that the recruiters for the £270,000-per-year ($335,000) role will opt for yet another white, male economist. That would be a mistake, and a missed opportunity. Given the recent assaults on central bank independence and criticism that monetary policy has disadvantaged huge swathes of the electorate, it’s more important than ever that policy-makers reflect the diversity of society as a whole. Here, then, are some of the attributes the government should be looking for, as it trawls through the applications for this prestigious post.

Shatter the glass ceiling

The monetary-policy committee has nine members, of whom five are Bank of England staffers and four are external appointments. Minouche Shafik’s departure, more than two years before she was due to depart, leaves just one woman, the American economist Kristin Forbes, on the panel—and her threeyear term expires in the middle of next year. Of the 30 previous panel members, only four were women, including Rachel Lomax who served as deputy governor

from 2003 to 2008. Moreover, Lomax and Shafik are the only female members who were central bank staffers rather than external appointments. So it’s pretty obvious what gender the next Bank of England member should be to avoid the “male, pale and stale” accusation that’s all too appropriate in many, if not most, public appointments. It would also be welcome if, given a choice between two equally qualified candidates, the selectors gave some weight to the desirability of hiring a black, or Muslim, or disabled worker.

Location, location, location “They’re all very worthy and qualified people, but they’re all of a type. I’m not aware there’s anyone there who lives in the North,” member of Parliament John Mann said of the current coterie of UK policy-makers. One of the stark conclusions from the geographical distribution of the votes in the June referendum to quit the EU was just how wide the gap is between citizens of the capital city and the rest of the country. No matter how hard the Bank of England works to be seen to be inclusive by visiting the rest of the country and having a team of agents speaking to businesses

and consumers in the regions, it’s hard to shake the accusation that it belongs to a metropolitan elite out of touch with the concerns in a Welsh village or a Scottish shipyard. Why not have a member who works from Sheffield or Aberystwyth, and commutes to London when necessary?

Brexit means Brexit

Gov. Mark Carney has warned that it would be wrong to assume every member of the Monetary Policy Committee (MPC) voted to stay in the EU. I’d still happily wager a fiver that all nine were opposed to Brexit. It would help counter the accusations (unfounded, in my view) of pro-EU bias at the bank if the next member was an advocate of an EU departure; it might also improve communications with the government committee that will handle the divorce negotiations in the coming years.

Hire an entrepreneur, not an economist

The advert says the successful candidate “will have an advanced understanding of economics.” I’d argue that professional economists are increasingly having to admit that even they don’t really understand what makes economies tick. Given the amount of time the new deputy governor will be forced to spend in the company of other officials—“He or she will be a member of the MPC, the Financial Policy Committee, the Prudential Regulation Committee, the Court of the Bank of England and will also represent the Bank on several international bodies,” the job description states—it might actually be more helpful if they are not a professional economist so they can resist groupthink and bring a different experience and viewpoint to the discussion.

I’ve argued before  that the lack of businesspeople on monetary-policy boards is a serious shortcoming. Noone understands the labor market and the economy quite like someone who’s built a business from scratch. Nothing focuses the mind quite like having to make payroll on a Friday. Conservative lawmaker Andrew Tyrie, who heads the Treasury Select Committee, said earlier this week in a discussion about central bankers that “their capacity to create a theology is virtually boundless.” He’s absolutely right. Given the newfound enthusiasm among central bankers for all things blockchain, perhaps a bitcoin entrepreneur is the ideal candidate.

The common touch

AS well as having well-rounded and diverse personalities, monetary-policy makers should empathize with the interests, desires and ambitions of their constituency. (Gov. Mark Carney revealed under interrogation by a gang of schoolchildren in September that the culinary television program  The Great British Bake Off  is his guilty pleasure.) The next deputy governor doesn’t need to be a fan of fondant fancies and threedimensional gingerbread structures, but being aware of cultural context doesn’t hurt.At this point, it would be nice if I could at least come up with a shortlist of candidates for consideration. Unfortunately, the world of business and finance remains a white male bastion; only seven of the UK’s 100 biggest businesses, for example, are run by women (see what I mean about the glass ceiling still being firmly in place?). I’m at a bit of a loss. But if you know anyone who fits the bill, the Cabinet Office is taking applications until midday on November 21.


Opinion BusinessMirror

opinion@businessmirror.com.ph

Tax benefits of nonstock and nonprofit educational institutions Jeffrey G. Salazar

DEBIT CREDIT

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S former South African President Nelson Mandela said, “Education is the most powerful weapon which you can use to change the world.” In general, education is the transfer of learning or knowledge from the teacher to the students through teaching, training and mentorship. Education can also be acquired informally through self-learning and personal experiences. Nonstock and nonprofit educational institutions are essential in providing quality education to the Filipino youth and in preparing them toward their path to become productive and competent individuals. These educational institutions serve as the second home and secondary parents for the students to nurture their talents, skills and potential. The state recognizes the importance and role of these nonstock and nonprofit educational institutions in nation-building. Thus, the state grants them a preferential incometax rate of 10 percent compared to the normal income-tax rate of 30 percent for corporations. On top of that, the educational institution is an exempt entity and, thus, it is not liable to value-added tax or percentage taxes. It is also exempt from the payment of real property taxes for as long as the property is being used directly and exclusively for educational purposes. To avail itself of these privileges, the educational institution must be accredited with the Commission on Higher Education (CHED) or Technical Education and Skills Development Authority (Tesda). It must also be ensured that the other income, which is considered unrelated to their primary purpose, does not exceed 50 percent of its annual gross income. Otherwise, it will be treated as normal corporation that is subject to regular income tax. Good news is in store for those accredited and compliant educational institutions. On July 25, 2016, Bureau of Internal Revenue Commissioner Caesar R. Dulay issued Revenue Memorandum Order (RMO) 44-2016, wherein educational institutions can apply for exemption of income taxes, provided that these meet two criteria: first, the school must be nonstock and nonprofit; and, second, the income is directly and exclusively used for educational purposes. The said RMO is based on Section 30 of the 1997 Tax Code, which states that nonstock and nonprofit educational institutions are exempted from income tax. Those qualified educational institutions must apply for tax exemption with the Office of the Assistant Commissioner of the Legal Service. The RMO enumerates the documentary requirements to accompany the tax

Last July 25, 2016, BIR Commissioner Caesar Dulay issued Revenue Memorandum Order (RMO) 44-2016, wherein educational institutions can apply for exemption of income taxes, provided they meet two criteria: first, the school must be non-stock and non-profit, and, second, the income is directly and exclusively used for educational purposes. The said RMO is based on Section 30 of the 1997 Tax Code, which states that non-stock and non-profit educational institutions are exempted from income tax. exemption application such as: n Application letter for tax exemption ruling. n Certified true copy of Certificate of Good Standing issued by the Security Exchange Commission. n Certification under oath of the treasurer as to the amount of income, compensation, salaries or any emoluments paid to trustees, officers and other executive officers. n Certified true copy of the financial statements for the last three years. n Certified true copy of permit/ accreditation issued by the CHED and/or Tesda. n Certificate of utilization of annual revenues and assets by the treasurer or his equivalent. Other additional requirements or documents during the review of the tax-exemption application, only if necessary. The Certificate of Tax Exemption that the BIR may grant the nonstock and nonprofit educational institution has no expiration and shall remain effective without the need for revalidation unless recalled by the BIR. The details of the said RMO is available online at the BIR official web site www.bir.gov.ph Jeffrey Galang Salazar is a Certified Public Accountant (CPA) and a Master in Business Administration (MBA) degree holder. He is currently connected with Tong Hsing Electronics Phils. Inc. and the Pamantasan ng Cabuyao. This column accepts contributions from accountants, especially articles that are of interest to the accountancy profession, in particular, and to the business community, in general. These can be e-mailed to boa.secretariat.@gmail.com.

‘Building islands on water’ through PPPs By Alberto Agra

PPP Lead

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lassification of reclaimed land. Simply put, reclamation is “building islands on water”. The lands reclaimed from foreshore and submerged areas form part of the public domain and therefore owned by the state. These islands can only be disposed pursuant to a presidential proclamation classifying these as alienable and disposable. A special patent will be issued thereafter confirming the grant by the state of a parcel of public land in favor of the grantee.

PRA’s mandate. The PRA, established in 1977, primarily serves as the clearinghouse for all reclamation projects in the country. It is a self-liquidating infrastructure development authority focused on reclamation. Per the Supreme Court, PRA is not an end-user of reclaimed land. Inclusive list of reclaiming authorities. The authority to reclaim is not exclusive to the PRA. Under the 1991 Local Government

Code, LGUs, such as provinces and cities can reclaim. Municipalities also could, in collaboration with or with the consent of the province. Others—GOCCs/GIs, like the National Housing Authority (NHA) and Laguna Lake Development Authority (LLDA)—can also reclaim under their respective charters. LGUs and GOCCs/GIs, like the NHA and LLDA, are end-users. Options for government. The PRA, other GOCCs/GIs and LGUs

Battle of the burial laws Atty. Lorna Patajo-Kapunan

legally speaking

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fter three decades, the issue on the burial of former President Ferdinand E. Marcos at the Libingan ng mga Bayani has finally reached the Supreme Court (SC) to determine the legality of the said act.

On August 7, 2016, President Duterte, through the secretary of defense, Delfin N. Lorenzana, ordered the interment of the remains of Marcos. Several petitions from different parties were filed before the SC to stop the said order. Several laws, regulations and legal principles were considered in order to resolve numerous issues. In the end, the Supreme Court decided to dismiss the petitions. In resolving the issues of the case on the substantive grounds, the SC held that the President’s decision to bury Marcos at the Libingan ng mga Bayani is in accordance with the Constitution, the law and jurisprudence. It was, likewise, held that the President did not execute the order whimsically, capriciously or arbitrarily, out of malice, ill will or personal bias. As regards the Constitution, the SC found no provisions that would directly or indirectly prohibit the burial. Interestingly, Republic Act (RA) 289, entitled “An Act Providing for the Construction of a National Pantheon for Presidents of the Philippines, National Heroes and Patriots of the Country”, was cited

vis-à-vis AFP Regulations G 161-375 in opposing the same. Section 1 of RA 289 provides that for the perpetuation of the memory of all the presidents of the Philippines, national heroes and patriots for the inspiration and emulation of this generation and of generations still unborn, there shall be a construction of a National Pantheon as the burial place of their mortal remains. Meanwhile, under AFP Regulation G 161-375, the chief of staff shall be responsible for the issuance of the interment directive for all active military personnel for interment, authorized personnel, and retirees, veterans and reservists enumerated therein. Furthermore, the said regulation provides for the following qualifying standards as regards the eligibility for interment at the Libingan ng mga Bayani: (a) Medal of Valor awardees; (b) Presidents or Commanders-in-Chief of the Armed Forces of the Philippines; (c) Secretaries of national defense; (d) Chiefs of Staff of the AFP; (e) General/flag officers of the AFP; (f) Active and retired military personnel of the AFP to include active draftees and

Consider this: Trump might be a good president By Clive Crook | Bloomberg View

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he idea that Donald Trump might be a good president seems as unlikely as the idea that he would win the election. Yet, as we see, strange things sometimes happen. Actually, I wasn’t as stunned by his win as many other observers. If he proves to be a good president, that will surprise me more. One always comes back to his character. What happens when such a vain, impulsive, bullying and proudly ignorant man meets resistance, or has to deal with a crisis? That’s certain to happen. The risk with such a leader isn’t so much that he will be a routinely disappointing president, but that he might be a disastrous one. Nonetheless, he has one or two things going for him. The first is expectations. His supporters are said to be in for a colossal disappointment. Yet, they might

be less crestfallen than you’d think. After all, how many will really be surprised that Trump can’t and won’t keep his promises to them? For many of his supporters, the biggest benefit of electing Trump has already been banked: They told Washington what they think. His critics, on the other hand, have been so harsh that it won’t be difficult for Trump to prove them wrong. Respectable opinion has declared itself so violently against Trump that he’ll be held to a very low standard. Small acts of civility and moderation will seem like remarkable achievements. The view that he’s a farright racist zealot, a 21st-century Hitler, shouldn’t be hard to refute: He just needs to avoid dressing his supporters in paramilitary uniforms, declaring martial law in the inner cities and building a network of concentration camps. President Obama and Hillary Clinton tapered their denunciations of Trump

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once he was elected, choosing to be gracious and open-minded. Bernie Sanders and Elizabeth Warren have both said that, much as they detest Trump, they’ll work with him if he comes forward with policies to advance the people’s interests. Of course, they’re right to do so— but only because a lot of what they said about Trump before was over the top. If they were right last month about the evil Trump is bent upon, what they’re saying now would be wrong. In that respect, I have to give credit to Slate’s Jamelle Bouie. He wrote recently that all Trump supporters (not just half of them) are just plain bad people, because they’ve put an irredeemably evil man in power. And he says Sanders and Warren shouldn’t do business with Trump, issue by issue, because this will help him advance his vile white-supremacist purposes. Bouie is the crazy zealot here, obviously—but at least he’s consistent.

If Trump were indeed a Hitler for our times, you would be right to refuse any and all cooperation, and to stop him by any means necessary. It makes no sense to call him evil and then start making deals, as some Democrats now propose. The question is whether these deals will be any good. It’s possible—because, again, the orthodox line of attack on Trump is wrong. He isn’t “far-right”. In the agreements he’ll aim to reach with Republicans in Congress, he’ll often be a moderating influence, pulling to the left. “Congressional Democrats”, writes the New York Times, “divided and struggling for a path from the electoral wilderness, are constructing an agenda to align with many proposals of Presidentelect Trump that put him at odds with his own party.” Trump has said he wants to cut taxes and increase spending on infrastructure. A big fiscal stimulus is exactly what

can reclaim, procure infrastructure from developers or contractors, or partner with PSPs in PPPs. In procurement, the Government Procurement Reform Act must be followed. The reclaimed land becomes government property. For PPPs, the build-operate-transfer (BOT) law, joint-venture (JV) guidelines issued by the National Economic and Development Authority (Neda) for GOCCs/GIs, and LGU JV ordinances must be followed. Lease and disposition to PSPs. All reclaimed lands, whether undertaken by the PRA, LGUs and other GOCCs/GIs, by themselves or through PPPs with PSPs, are titled under the name of the PRA. The PRA can lease the land to private corporations, Filipino individuals and government agencies. However, under current case law, it, not being an end-user, cannot sell the reclaimed land to private corporations. It can only dispose, pursuant to the relevant presidential proclamation and under a special patent, to Filipino individuals and GOCCs/GIs. These individuals and GOCCs/GIs, in turn, can sell or lease to private corporations. PSPs who partner with LGUs and GOCCs/GIs, like the NHA and LLDA, can be entitled to a share

of the reclaimed land as payment for financing the reclamation and dredging and introducing technology and innovation under the relevant BOT law-variant or JV arrangement. In this case, the PRA, being the title owner, transfers the title to the end-user-LGU or -GOCC/ GI who then effects the transfer to the PSP, which is a corporation, as partner or coventurer. The reclaimed land is apportioned between the government as owner, while the PSP gets a share as developer. The PRA regulates, endorses to the Neda Board under Executive Order 146, effects the titling and is entitled to a share from the government portion of the reclaimed land. Reclamation has a transformative purpose and this purpose is the pursuit of better quality of life for Filipinos. New land means new development, new communities, new roads, new airports and additional utilities aimed at alleviating poverty, easing traffic, providing access and creating business opportunities, while promoting human rights and climate justice.

trainees who died in the line of duty, active reservists and Cafgu Active Auxiliary (CAA) who died in combat operations or combat-related activities; (g) Former members of the AFP who laterally entered or joined the PCG and the PNP; (h) Veterans of Philippine Revolution of 1890, WWI, WWII and recognized guerrillas; (i) Government dignitaries, statesmen, national artists and other deceased persons whose interment or reinterment has been approved by the Commander-in-Chief, Congress or the secretary of national defense; and G) Former presidents, secretaries of defense, dignitaries, statesmen, national artists, widows of former presidents, secretaries of national defense and chief of staff. As to the disqualification, the following are not qualified to be interred in the the Libingan ng mga Bayani: (a) Personnel who were dishonorably separated/reverted/discharged from the service; and (b) Authorized personnel who were convicted by final judgment of an offense involving moral turpitude. It was argued that RA 289 provides for the legal standard for internment at the Libingan ng mga Bayani, and that AFP Regulation G 161-375 merely implements the law and should not violate its spirit and intent. Nevertheless, the Supreme Court rejected the said assumption, stating in its decision that the Libingan ng mga Bayani and the National Pantheon are one and the same. Accordingly, the SC upheld the validity of the said regulation since there is still no law or any executive issuance contrary to it. It remains to be the sole authority in determining who are entitled and disqualified to

be interred at the Libingan ng mga Bayani. Moreover, the Supreme Court did not apply the standard that the Libingan ng mga Bayani is reserved only for the “decent and the brave” or for “heroes” since it would be violative of public policy, as it will put into question the validity of the burial of each and every mortal remains resting therein, and infringe upon the principle of separation of powers, since the allocation of plots at the the Libingan ng mga Bayani is based on the grant of authority to the President under the existing laws and regulations. In accordance with the Libingan ng mga Bayani, the SC acknowledged the awards that former President Marcos had received, as well as those other positions he held aside from being the president and commander-inchief, in spite of his alleged humanrights abuses and corrupt practices. Furthermore, the Supreme Court found no disqualification that would disallow the interment of the former president. Consequently, it was held that former President Marcos possessed none of the disqualifications stated in the regulation. He was also neither convicted by final judgment of the offense involving moral turpitude nor dishonorably separated/ reverted/discharged from active military service. With the foregoing pronouncements of the SC, it is worthy to note that the former President was forced out of office by the people via the Edsa Revolution. It, however, did not give any particular legal meaning to it. In the end, the decision of the Supreme Court was based only on the interpretation of the applicable laws, without going beyond established rules and principles.

many liberal economists have been calling for these past several years. Today, as you might expect, they’re no longer so sure. Some damn-the-torpedoes Keynesians now see the merit in fiscal conservatism. They’re right about the need to make fiscal policy sustainable and get value for public money in infrastructure programs, points not hitherto emphasized. In the short run, though, a Trump presidency could give them a macroeconomic policy that’s closer to the one they’ve been advocating than anything they’ve seen so far. And in the short run, it would boost growth. In economic policy, the biggest danger is that Trump’s idiotic views on trade will start a cycle of protection and retaliation, maybe even a full-scale trade war. (I’ll be interested to see whether Trump’s victory produces an adjustment in expert opinion like the one we’re seeing on fiscal policy—from “We’re all

trade skeptics now” to “Liberal trade is vital for our prosperity.”) Yet, trade, so central in his campaign, is apparently not among the three things he wants to address right away. Those would be tax reform, immigration and health care. In each case, to be sure, a Trump administration could easily do more harm than good. We’ll see. On all these matters, bear one more thing in mind. It will help that Trump has no ideology. This could be his biggest asset. His views, expressed with total conviction, are lightly held, insofar as they even exist. His goal isn’t to drive through, at any cost, some radical transformation of America’s society and economy, or to reorder international relations and remake the world. It’s to prove his critics wrong, and keep on winning.  I’m betting he won’t. For the reasons I mentioned, I’m worried he’ll fail spectacularly. But you never know.

The Columnist is now the Chairman of the Board of the Philippine Reclamation Authority.


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www.businessmirror.com.ph

Senate set to ratify PHL membership in AIIB 2.6B 2013 S

MILLIONS OF FILIPINOS LACK ACCESS TO TOILET FACILITIES–WORLD BANK By Cai U. Ordinario

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@cuo_bm

ome 26.3 million Filipinos still do not have access to toilet facilities, making it difficult to eradicate diseases, particularly in urban areas, according to a report from the World Bank. Citing data from the United Nations, the World Bank said the country was able to increase access to toilet facilities to only 74 percent in 2015, from 57 percent in 1990. The millions of Filipinos who do not have toilet facilities are among the 2.6 billion people in the world who still lack access to sanitation services. “The increasingly rapid pace of urbanization, combined with evidence showing great health impacts of poor sanitation in dense urban areas, makes this a

By Butch Fernandez

The number of people in the world who still lack access to sanitation services

key barrier to sustainable development,” the World Bank said. The World Bank added that the absence of sanitation facilities, like toilets, has long-term impacts on people. As such, it also has been cited as among the leading causes of child stunting globally. This is the reason access to sanitation has been included both in the Millennium Development Goals (MDGs) and the Sustainable Development Goals (SDGs). See “Filipinos,” A2

@butchfBM

ENATORS cramming to pass the P3.3-trillion 2017 budget bill are looking to ratify Philippine membership in the China-led Asian Infrastructure Investment Bank (AIIB) this week to meet a December 31 deadline for joining AIIB as a founding member with access to special funding for development projects.

Majority Leader Vicente C. Sotto III said the awaited plenary vote formally ratifying the Philippines’s AIIB entry documents may be “inserted” in the Senate’s marathon

sessions by midweek, amid its tight schedule to fast-track the approval of the budget bill as Congress is set to adjourn for a four-week Christmas recess by December 16.

The year when the Beijing-led AIIB was first conceived

Sotto indicated over the weekend that the senators, currently tied up with the budget deliberations, have yet to fix the target date for plenary voting on the AIIB agreement. “No schedule yet,” Sotto told the BusinessMirror over the weekend. But he hastened to add it could be accommodated in their Wednesday’s session agenda. “Puwedeng isingit, baka Wednesday.” Senate sources said the Committee on Foreign Affairs is rushing to meet the December 31 deadline

Govt mulls future of Conditional Cash Transfer Program as poverty lingers Continued from A1

education, particularly of children aged 0 to 14.” Eight years later, Social Work Secretary Judy M. Taguiwalo wants to “correct that perception.” “[The] Pantawid Program is a safety-net program, not a poverty-alleviation program,” Taguiwalo told the BusinessMirror. “[The 4Ps] is not designed to address the root causes of poverty in the Philippines or to enable Filipinos to end their poverty through the monthly allocations they receive from the program.” She added that under her leadership, the focus of the DSWD is now to develop resilience and independence among beneficiaries through a separate DSWD program. The 4Ps will still continue while we are still currently assessing the implementation of such scheme, she explained. Taguiwalo said the assessment is needed, given that there are many “unsettled and unresolved issues surrounding it,” such as unliquidated funds by some P10 billion as stated by the Commission on Audit (CoA). A paper by Celia M. Reyes and Aubrey D. Tabuga of the Philippine Institute for Development Studies (Pids) explained that after its inception and piloting in 2007, the government widened and formally implemented the 4Ps in 2008. According to the paper, the 4Ps that time offered P6,000 annually (P500 per month) for each select household. The money should meet the household’s health and nutrition expenses. The 4Ps also provides P3,000 per child for one school year (i.e., 10 months), or P300 per month, for educational expenses. Only up to a maximum of three children for each household can receive a subsidy. In return, the beneficiary household should meet several conditions. (See related story above) Four years after it was launched on a wider scale in 2008, the 4Ps reached 2.3 million households in 80 provinces. Reyes and Tabuga said in their paper, titled “Conditional Cash Transfer Program in the Philippines: Is it reaching the extremely poor?”, the initial design of the 4Ps pointed out that the National Household Targeting System (NHTS), where the list of beneficiaries of the 4Ps comes from, was explained to have overestimated the number of poor families by at least 300,000 since its implementation in 2008. To pull more families out of the fringes of subsistence, the DSWD under the administration of President Benigno S. Aquino III further expanded the 4Ps to cover more poor households. It was then made available to children up to 18 years of age or until they finish senior high school. Currently, there are 4.3 million households that are part of

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Money matters

the program, DSWD data revealed. Data from the Department of Budget and Management (DBM), on the other hand, revealed there are 4.4 million (4,402,253) households under the regular CCT Program.

Funding

THE 4Ps was funded through a loan by the Arroyo administration from the World Bank and the Asian Development Bank, amounting to a total of $805 million, or P34.6 billion, Reyes and Tabuga said. Approximately, P120 billion have been allocated to the program up to 2013. The COA reported that as of December 31, 2015, the DSWD secured seven foreign loans amounting to P90.03 billion to implement five projects, three of which are still ongoing, including the CCT. Among the comments the COA made was that there were recurring deficiencies in the implementation of 4Ps “resulting in delayed delivery of assistance to rightful beneficiaries [and] unnecessary holding of idle funds” by the Land Bank of the Philippines (LandBank) and its conduits. The report added that payments to qualified beneficiaries suffered delays by 12 months to 15 months due to delayed processing and release of checks or absence of partner conduits, among others. Taguiwalo said she and the members of her

DSWD transition team will use the observations made by the COA. She added they would take these observations into consideration for the ongoing review of DSWD programs, particularly the 4Ps. “Although the COA report indicated that the amounts remained either idle or unliquidated with LandBank and its conduits and other government agencies, the department is alarmed by the magnitude of the amounts involved because they are equal to more than 10 percent of the budget of the DSWD,” Taguiwalo said. She explained she and her team have earlier discussed this matter with career officials at the DSWD. Taguiwalo, however, declined to reveal what transpired during the discussion.

Effectivity level

TAGUIWALO clarified that “by no means are CCT schemes an effective means to end poverty.” “To end poverty, the government and its agencies should create and provide jobs and stable employment for the poor and implement a thoroughgoing genuine agrarian-reform program,” she told the BusinessMirror in an email interview. “The majority of the poor are farmers and farmworkers: address their needs and you can significantly alleviate poverty levels in the country.” Still, she said the DSWD is not turning a deaf ear on the complaints reported concerning the program.

“We are going to conduct a revalidation campaign among Pantawid beneficiaries, given that there are so many complaints and reports that many of the beneficiaries are undeserving because they don’t belong to the poorest of the poor and that many already have independent, steady sources of income,” said Taguiwalo, who was in Baguio City with DSWD officials for an evaluation of the CCT. “We also continue to receive reports that many Pantawid beneficiaries do not use their benefits to help themselves and their families, but instead, squander these same benefits. We are investigating these reports.” For those who are in doubt of the program, Taguiwalo has this to say: “We are not surprised that many doubt the program.” Again, she said she understand these doubts come from the “many complaints and allegations of irregularities.” “We continue to investigate these various allegations and reports, even as we also work to improve the program implementation,” she said. “We also want the public to know that there other DSWD programs they can use and benefit from.” According to her, she wants the 4Ps “to be of the best use our beneficiaries—so they can use the educational discussions or family development sessions they attend to improve their lives.” To be continued

to ratify the AIIB agreement before the Christmas break of Congress. It was learned that during the Aquino administration, the Executive Department submitted the AIIB papers to the Senate on February 2016, but since elections were approaching, the documents were archived. Sources confided to the BusinessMirror that the Duterte administration submitted the measure “just last month, kaya medyo naghahabol sa Senate.” The Beijing-led AIIB was first conceived in 2013 to “promote interconnectivity and economic integration in the Asian region” and foster cooperation with existing multilateral development banks, with the Philippines listed as 57th founding member-country after executing the Articles of Agreement of AIIB signed by then Philippine Ambassador to China Erlinda Basilio.

Car sales seen past the target Continued from A1

achieved, given the good situation now,” he added. The Campi chief said the local industry is confident about the prospects of selling more cars due to the rising income of consumers and the relatively low number of car owners in the Philippines. However, Gutierrez urged the government to ensure the consistency of policies to ensure that the local auto industry would remain on the growth path. While the local auto industry has weathered changes from intensified competition with importers, he said a “clear” government policy is a key factor that can affect market performance. “The auto industry has been growing and government policy is very significant,” Gutierrez said. Earlier, the Department of Finance has proposed to increase the excise tax on automobiles to recoup revenues that the government could lose from lowering corporate and personal income taxes. The government, however, did not scrap the Comprehensive Automotive Resurgence Strategy (Cars) Program—a manufacturing stimulus initiative, which seeks to provide the local auto industry with a P27-billion subsidy. Gutierrez said the industry is still studying the impact of these two “conflicting” initiatives and the possible “middle-ground” to ensure the continuous growth of the local manufacturing sector. The “Change: Corporate Transformation in the New Economy” forum is one of the activities lined up by the Ateneo de Manila University Graduate School of Business to celebrate its 50th anniversary this year. It is part of a series of business forums launched by the university across its four satellite campuses to raise awareness on its various graduate programs. The academic institution wrapped up the second business forum in Santa Rosa, Laguna. The third forum will be held in Cebu City on November 25, while the last activity will be staged in Ateneo’s Iloilo campus in February 2017. Catherine N. Pillas

Businessmirror november 21, 2016  
Businessmirror november 21, 2016  
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