Businessmirror november 24, 2016

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Thursday, November 24, 2016 Vol. 12 No. 43

‘Returning OFWs now assured of local jobs’

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By Cai U. Ordinario

@cuo_bm

verseas Filipino workers (OFWs) returning home for good are now assured of domestic employment, with the construction industry alone seen to generate 1 million jobs annually in the next six years.

Budget Secretary E. Benjamin Diokno, during the panel discussion of the Global Investment Forum at F1 Hotel in the Bonifacio Global City on Wednesday, said

government infrastructure projects alone can already generate at least $50 billion worth of jobs in the next six years.

This, Diokno said, will help

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The estimated number of construction-industry jobs to be generated annually assure OFWs that coming home to the Philippines will not render them jobless. He said the government has an P8.2-trillion infrastructure budget that can generate the needed boost to economic activity and job generation.

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Continued on A2

Rail transportation sidetracked by obsolete policies, corruption

Budget Secretary Benjamin E. Diokno (left) answers questions from the audience, while Department of Tourism Assistant Secretary Frederick M. Alegre (right) responds to queries from Management Association of the Philippines’s Eduardo Yap during the Global Investment Forum 2016 held at F1 Hotel in Bonifacio Global City in Taguig. NONOY LACZA

DOT seeks ₧1T in tourism investments

By Ma. Stella F. Arnaldo

@akosistellaBM Special to the BusinessMirror

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HE Philippines needs at least P1 trillion in tourism investments to generate 12 million in foreign tourist arrivals by 2022.

In an interview with Tourism Undersecretary Rolando Cañizal on the sidelines of Wednesday’s Tourism Summit at the Diamond Hotel, the Department of Tourism (DOT) is also targeting total tourism revenue to reach some P4 trillion by 2022, of which P922 billion and P2.95 trillion will come

from international and domestic travelers, respectively. Total revenue in 2016 is projected at P2.16 trillion.

These targets are laid out in the DOT’s National Tourism Development Plan (NTDP) for 2016-2022, which lists government programs and projects, as well as privatesector investments, needed to reach tourism economic targets.

“While we’re still refining the number of investment projects and their amounts needed, we estimate there will be more than P1 trillion in investment [needed] both for private and public sector,” Cañizal said.

PESO exchange rates n US 49.8060

Under the NTDP, the DOT also forecasts local employment in the tourism sector to benefit 6.5 million individuals by 2022, for a 14.4-percent share in national employment, from 5 million employed in 2016, with a 12.7-percent share to national employment.

“This increases the share of the tourism sector to the gross domestic product, from the current 8.2 percent to 14 percent by 2022,” Cañizal said.

“This is why there is an urgent need to fuel more investments in the sector, so we can create more expenses for both foreign and local tourists,” he added.

₧4T

The DOT’s targeted tourism revenue by 2022

He also said some of the infrastructure projects that were not implemented under the 20102016 NTDP will still be included in the NTDP for 2016-2022. “There will still be projects under the

NEW SPECIAL ENVOY TO U.S. IS TRUMP’S BUSINESS PARTNER

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mong the conflict-of-interest questions swirling around US President-elect Donald Trump’s global business interests, Trump Tower at Century City in Manila’s financial district stands out.

Century Properties Group Inc. of Manila, the company behind the $150-million tower that’s set to open next year, paid as much as $5 million to use the Trump name, in a licensing agreement that’s common for the president-elect. Trump has at least

10 similar licensing deals around the world, each of which might complicate his administration’s international diplomacy, according to ethics specialists.

But in Manila, there’s an extra connection: Century Properties’ chief executive and controlling stakeholder Jose E.B. Antonio was appointed last month to serve as a special government envoy to the US for President Duterte, who has vowed to expel American troops See “Special envoy,” A2

Unless the foreign government was passing funds through that company to Donald Trump, I don’t think the emoluments clause would be implicated.”

—Covington & Burling Llp.

See “DOT,” A2

n japan 0.4486 n UK 61.8441 n HK 6.4219 n CHINA 7.2267 n singapore 35.0007 n australia 36.8515 n EU 52.9239 n SAUDI arabia 13.2805

Source: BSP (23 November 2016 )

BMReports BusinessMirror

A2 Thursday, November 24, 2016

‘Returning OFWs now assured of local jobs’ Continued from A1

“Can you imagine if we are on a threeshift basis in construction, plus the amount of money that we are going to spend on construction, this does not include housing, which is a private-sector concern,” Diokno said. “There will be a lot of jobs in the Philippines. If they [OFWs] want to come home, they are welcome to come home.”

Diokno said the government will undertake P860.7 billion worth of infrastructure projects in 2017. While the number and cost of infrastructure projects are lower than the desired average of over P1.3 trillion a year, he expects the amount to gradually ramp up in the coming years.

He said these projects include bigticket infrastructure undertakings, such as the P250-billion to P300-billion Mindanao Railway Project, as well as road-widening projects to be undertaken nationwide.

The list also includes various National Economic and Development Authority (Neda) Board-approved projects, such as the New Cebu International Con-

Special envoy. . .

Continued from A1

from his country and ranted against President Barack Obama. Antonio says he sees no conflict between his public role and private partnership. “My role is to enlarge the relationship between the two countries,” he said in an interview. Of his business tie to Trump, he said: “I guess it would be an asset.” Antonio told Bloomberg News that he visited Trump Tower in New York days after the US election; he didn’t speak to the president-elect, Antonio said, but he saw Trump talking with potential appointees.

Asked about his account, Hope Hicks, a Trump spokesman said: “They did not meet.”

Potential conflicts

tainer Port Project; South Line of the North-South Railway Project; Malitubog-Maridagao Irrigation Project, Stage 2; Ninoy Aquino International Airport (Naia) PPP Project; Metro Manila Bus Rapid Transit (BRT)-Edsa; Plaridel Bypass Road Project; and the Improvement/Widening of General Luis Road (Quezon City to Valenzuela City) Project, among others.

The projects also include those under the P2.2-trillion Three-Year Rolling Infrastructure Program (TRIP). The TRIP is a modification of the Comprehensive and Integrated Infrastructure Program.

The TRIP is the multiyear program for infrastructure that ensures that once an infrastructure program has been planned and rolled out, it will continue to receive funding from the government.

Further, Diokno said the administration is pushing heads of agencies to speed up the crafting of projects or they will lose their jobs in the process.

Tungpalan on Monday also told the BusinessMirror that the Neda, Infrastructure Committee (Infracom) and the Investment Coordination Committee (ICC) will also propose infrastructure

Regardless, Antonio’s dual roles as private business partner and official government envoy underscore the global scale of the potential conflicts facing Trump and his family even before he’s sworn in as the 45th president. Questions have been raised in two instances: Trump took a break from transition discussions to meet with three business partners who are building Trumpbranded towers in India, according to media reports. And a spokesman for Argentine President Mauricio Macri on Monday denied a report in La Nacion newspaper that Trump had asked for help with permits for a Buenos Aires real-estate project during a post-election call with Macri.

Trump rejected concerns about his po-

tential conflicts of interest. “Prior to the election it was well known that I have interests in properties all over the world,” he posted on Twitter on Monday night. “Only the crooked media makes this a big deal!”

On Tuesday, during a meeting with reporters and editors of the New York Times, Trump said: “The law’s totally on my side, the president can’t have a conflict of interest,” according to an account of his remarks that Times reporters posted to Twitter. Few laws govern how US presidents must conduct their personal business affairs. Presidents are exempt from the 1978 Ethics in Government Act, an exception crafted out of the belief that presidents shouldn’t have to worry about triggering ethics probes when making hard decisions.

Kellyanne Conway, a top Trump aide, told reporters on Monday that while Trump’s widespread business interests mean “we’re in unprecedented times,” he’s getting advice from “various lawyers, accountants and advisers telling him what he can and can’t do.” “I’m very confident he is not breaking any laws,” Conway said.

The US Constitution bars government officials, including presidents, from taking payments or gifts from foreign governments or profiting from a company tied to a foreign government—but it’s unlikely that Trump’s arrangement with Antonio would violate that

projects needed to meet the government’s infrastructure-spending target.

The projects will be contained in the Public Investment Program (PIP) that is currently being drafted by the Neda. The PIP is the country’s medium-term investment blueprint.

Tungpalan said the PIP, which will be released sometime next year, will contain at least a shortlist of projects that will be undertaken between 2017 and 2022.

Undersecretary Ruth B. Castelo of the Construction Industry Authority of the Philippines (CIAP) also said employment in the construction industry will see a boom starting 2017, with the Duterte administration’s impetus for a “Golden Age” in infrastructure. Castelo said the government sees the sector hiring a million workers annually in the next six years.

The contribution of the construction industry, both from public and private activities, is estimated at 7 percent of the national economy, or about P1 trillion.

Employment to be generated is seen to double from the 3 million workers in the construction industry estimated from January 2016 by the Philippine Statistics Agency (PSA) to 6 million in 2022.

“If we can generate 1 million a year in construction [jobs] for the next six years, by the end of the [administration’s] term by 2022, we can see some 6 million,” Castelo said, during the Philippine Construction Congress for Employment Generation held on Wednesday.

Castelo clarified the 1 million workers will only be in the construction industry, and the figures exclude additional employment to be generated in related industries.

CIAP intends to facilitate this employment goal by accelerating the accreditation of contractors, which has steadily been increasing since the middle of the year, especially after the present administration gave the green light for nine infrastructure projects worth P 171 billion in September. “As of July we have 8,000 accredited contractors. By year-end we expect 15,000 contractors, and next year, 18,000,” Castelo said.

Public Works Undersecretary Maria Catalina E. Cabral added that the construction industry has been growing at an average rate of 11.2 percent from 2012 to 2016, underscoring the economic impact of construction to economic growth.

provision, said Robert Kelner, chairman of the election and political law practice at Covington & Burling Llp. in Washington.

“Unless the foreign government was passing funds through that company to Donald Trump, I don’t think the emoluments clause would be implicated—it’s extremely remote,” he said.

China and tried to pivot away from the US. In an October visit to Beijing, Duterte announced his “separation” from the US and vowed to resolve his country’s dispute with China over the South China Sea through talks and closer commercial links. “America has lost,” Duterte told a gathering of business leaders in the Great Hall of the People.

Earlier that month Duterte had told Obama to “go to hell” after US criticism of his war on drugs, which has resulted in more than 3,000 people being killed since he took office.

Trump spent much of his campaign promising to counter China’s growing economic power, but also railed against US protection of overseas allies in Asia and the Trans-Pacific Partnership trade deal, which was designed in part to stem China’s influence.

Some analysts have compared Duterte to Trump, a comparison Duterte rejected.

“He’s a bigot, I am not,” Duterte was quoted as saying earlier this year. He changed his tone after Trump’s victory, saying: “Long live Mr. Trump! We both curse at the slightest reason. We are alike.”

Creates complications There’s nothing illegal about Trump interacting with Antonio as a special envoy to the US on trade and economic policy while also being his business partner—but it creates unnecessary complications for US diplomacy, according to Richard Painter, a University of Minnesota law professor who was President George W. Bush’s chief ethics lawyer. The arrangement means that as president, Trump may have to respond to requests from a business partner who has paid him millions, he said.

“We have a president in the Philippines who is clearly volatile,” Painter said of Duterte. “We don’t want a situation where the US president is financially involved with a whole bunch of his supporters. That will have an adverse impact on our policy and our ability to figure out how to deal with Duterte and try to put back together our relationship with the Philippines.”

US-Philippine relations have soured since Duterte won the presidency in May. A key US ally in Asia since World War II, the Philippines under Duterte has sought rapprochement with

With Catherine N. Pillas

‘Smooth relationships’ The Trump Organization’s interests in the Philippines “might do something to smooth relationships” between the two countries, said Joshua Kurlantzick, senior fellow for Southeast Asia at the Council on Foreign Affairs. Bloomberg News

www.businessmirror.com.ph

DOT. . .

Continued from A1

previous administration that will continue to be carried out, most especially under the airport development program, because most projects were not completed during the last administration, so some of them will be completed by the midterm of this administration. That would further help accelerate the growth in tourism.”

He cited the opening of new airports in Bohol, Puerto Princesa, and the expansion of Iloilo and Bacolod airports are some of the priority projects that need to be implemented immediately.

“The commitment of this administration is we will be implementing the programs and the projects, most especially in infrastructure, as they are scheduled. The mandate to the Department of Transportation and the Department of Public Works and Highways is to continue to the infrastructure projects, so we will be able to lay a good foundation for growth,” he said.

If projections in arrivals and revenue are met, the DOT projects some 702,000 poor individuals to benefit by 2022.

The Tourism Summit was held to harmonize the DOT’s NTDP for 2016-2022 with the National Economic and Development Authority’s Philippine Development Plan (PDD).

Canizal said the PDP also prioritizes the tourism sector and considers it as a vital engine of economic growth. The NTDP is still undergoing some fine-tuning, with consultations ongoing with tourism stakeholders, but he said the final document will “hopefully be released by the first quarter of 2017. [These consultations] will help us align the NTDP with the PDP and the agenda of the President.”

Weak peso

Budget Secretary Benjamin E. Diokno said on Wednesday the weakening of the peso will boost the government’s ability to finance infrastructure projects.

Diokno said for every peso depreciation, the government gains P7.2 billion in collections. This augurs well for the economy, particularly in terms of financing its infrastructure projects.

“It’s favorable in general [such as for] OFWs [overseas Filipino workers], exporters but it is also favorable to us. For every P1 depreciation, we have a gain of P7.2 billion [for] government because we collect more,” he said on the sidelines of the Global Investment Forum held in F1 Hotel in Taguig.

Diokno also said he is not worried even if the peso breaches the P50 level. He said as long as the peso depreciation is “market determined,” it will not be a cause for concern.

He said funds are really returning to the United States right now, given the improvement of their economy and new administration. This, he said, will also explain the decline in the Philippine Stock Exchange Index (PSEi), which bucked the global trend and shed as much as 176.33 points, or 2.53 percent, on Tuesday.

“We’ve seen P55 [to the dollar]. As long as its market determined, [I’m not worried]. Money is [really] going back to the US,” Diokno said.

Earlier, Socioeconomic Planning Secretary Ernesto M. Pernia said the depreciation of the peso will still be good for consumption, even if the peso-dollar exchange rate hits P50 to P51.

Bangko Sentral ng Pilipinas Governor Amando M. Tetangco Jr. also did not express alarm over the continuous weakening of the peso during the week, saying the movement of the local currency is still attuned to the overall movements of currencies in the region.

Data from the PDS Group showed the peso declining anew to nearly P50, as it closed trade at P49.86 to a dollar, losing 1 centavo from the previous day’s P49.85.

Tetangco said the weakness of currency is not confined in the Philippine economy, but is a global trend as markets try to digest developments causing volatilities.

“Basically, the weakness in emerging-market currencies is due to dollar strength. Because the expectations that interest rates are going to rise in the US,” Tetangco said.

He said the movements are “basically in the middle of the range” in terms of both the actual movement, as well as in terms of volatility of exchange-rate movements.

With regard to a potential action from the BSP to curb this volatility, the BSP governor said: “We are sticking to our current foreign-exchange policy of allowing market forces of basically determine the exchange rate. But at the same time, we also do not want to see the exchange rate becoming out of line.”

Tetangco said the country’s strong macroeconomic fundamentals—including the third-quarter 7.1-percent growth, low inflation and ample reserves—is enough to serve as buffers for the volatilities brought about by the “many moving parts” in the external economy.

“We just need to further enhance our surveillance and continue to build buffers,” Tetangco said.

He also assured markets that the BSP has the tools to respond to further volatilities that may arise in the coming months. “We have a well-articulated policy framework, both on the monetarypolicy side and the financial stability side. So we know basically how to respond and we have the tools,” Tetangco said. “I think we’re ready.”

With reports from Cai U. Ordinario and Bianca Cuaresma

Economy BusinessMirror

news@businessmirror.com.ph

BOC raids yield ₧775M worth of fake clothing and cigarettes

By Joel R. San Juan

FAELDON: “The BOC’s capture of 11 manufacturing machines that were used by the syndicate to produce 250 cases of counterfeit cigarettes daily and feared sold in both local and international markets, with the fake BIR tax stamps, has effectively stopped huge government losses in billions of pesos in excise taxes, annually.”

@jrsanjuan1573

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HE Bureau of Customs (BOC) said on Wednesday that it has confiscated in separate occasions some P775 million worth of fake goods in raids in Pasay City, Bulacan and Pangasinan Recently, Customs operatives raided nine warehouses in Pasay City, where some P100 million worth of high-end counterfeit shoes and clothing items were seized.

Officials and personnel of the Customs Intelligence and Investigation Service, BOC Special Studies and Project Development Committee and Intellectual Property Rights Division led the inspection of warehouses.

The team discovered huge stash of branded counterfeit items, such as Nike, adidas, Lacoste, Abercrombie, Fitch, Tribal, Havaianas, Crocs, Sandugo, Sofia the First, Winnie the Pooh, Hermes, Jag, Hello Kitty, RRJ, Levi’s, Snoopy, Lakers, Dickies, Gap, Giordano, New Balance, Bench, Fubu, Von Dutch, Mickey Mouse, Hollister and Under Armor products.

However, arrest were made as the warehouse owners were not in the premises when the raids were conducted.

Last Friday hundreds of boxes of counterfeit cigarettes with an estimated street value of P500 million, including fake Bureau of Internal Revenue (BIR) tax stamps worth P175 million, were confiscated in separate raids in warehouses in Bulacan and Pangasinan.

BOC authorities and provincial officials arrested seven individuals at a warehouse in Marilao, Bulacan, and 24 Chinese workers in Villasis, Pangasinan.

Among those found inside the Bulacan warehouse are volumes/packages of assorted cigarette materials such as, but not limited to, cigarette filter, dried tobacco, glue and ciga-

rette packaging materials which are used in manufacturing cigarettes.

Finished cigarette products found and confiscated were imitations of cigarette brands Marlboro, Fortune, Jackpot, Skag and Farstar.

Philip Morris Fortune Tobacco Corp. (PMFTC) Inc. confirmed that the samples obtained from the confiscated items were not produced locally by or with permission of Philip Morris International, and are therefore counterfeit.

Also, found in the Pangasinan warehouse were contrabands that include 11 units of cigarette making/packaging machines, 1,453 sacks of cut-filter, 27 containers of menthol solution, 1,149 master cases of assorted brands of cigarettes, 22 trays of filter, 378 rolls of inner liner, 469 rolls of clear wrap, 88 pales of glue, 1,251 packs of cigarette brand soft labels, four units of air compressor, 3,244 bundles of assorted master cases and 2,173 reams of counterfeit BIR tax stamps.

“The BOC’s capture of 11 manufacturing machines that were used by the syndicate to produce 250 cases of counterfeit cigarettes daily and feared sold in both local and international markets, with the fake BIR tax stamps, has effectively stopped huge government losses in billions of pesos in excise taxes, annually,” Customs Commissioner Nicanor E. Faeldon said.

Records show that the BIR loses an estimated P3 billion in excise taxes from counterfeit tax stamps.

Editors: Vittorio V. Vitug and Max V. de Leon • Thursday, November 24, 2016 A3

ERC’s Salazar blasts House move to probe Villa’s suicide death over ‘midnight deals’

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By Lenie Lectura

@llectura

NERGY Regulatory Commission (ERC) Chairman Jose Vicente B. Salazar on Wednesday strongly rebuked “unscrupulous parties” for spreading false claims that the death of ERC Director Francisco Jose S. Villa Jr. was linked to “midnight deals” involving power-supply agreements.

“I lament the apparent attempt to piggyback on the unfortunate and untimely demise of our colleague.

This is grossly unfair to him and to his memory,” Salazar, who took the top ERC post during the term of President Benigno S. Aquino III, said.

Party-list Rep. Carlos Isagani Zarate of Bayan Muna urged the House energy committee to investigate the alleged midnight deals between the ERC and power-generation companies affiliated with the Manila Electric Co. (Meralco), which supposedly resulted in the suicide of Villa.

“This attempt is evident in the insinuation that the death of Director Villa may have also been precipitated by midnight deals allegedly linked between a large distribution utility and several power-generation companies,” Salazar said. “This smacks of opportunism and a blatant attempt to ride on the death of our colleague to advance a parochial agenda,” the ERC official said.

Villa took his own life on November 9. Suicide notes written three months ago indicate that he could no longer handle the pressure from Salazar.

“My greatest fear in the bids and awards committee is the AVP by Luis Morelos which the chairman and CEO, Jose Vicente B. Salazar, chose through a rigged selection system. That will be a criminal act,” Villa stated in his letters.

Salazar chose not to comment on the allegations, but assured to launch an impartial inquiry into the allegations to be done by an objective body.

“We have left that task totally in the hands of independent third-party investigators,” Salazar said, adding that he has also instructed all ERC officials to refrain from defending themselves. “I have issued this strict instruction based on the principle that we are not to defend our reputation at the expense of the memory of a dear colleague who served our organization well,” he added.

Just recently, ERC commissioners said they would never resign, and that they would face any investigation involving the matter. This was after President Duterte demanded all ERC officials to resign.

The ERC chairman said Villa has never been involved in the evaluation of applications for permits and

approval of power-supply agreements (PSAs) between distribution utilities, electric cooperatives and generation companies. “That was never Director Villa’s job. That is the responsibility of our Market Operations Service and our Regulatory Operations Service, of which Director Villa has no connection.”

Villa, he said, was appointed as chairman of a bidding committee, the function of which is to procure goods and services, not to evaluate the requirements of power firms.

The party-list congressman criticized the ERC for extending an order that allowed all distribution companies to conduct a competitive selection process in power-supply procurement. Zarate said the deadline was originally set for November 6, 2015, but was “mysteriously” moved to April 30, 2016.

Zarate said that with the extension, Meralco—the largest powerdistribution company—ended up securing 20-year PSAs with seven generation companies, which Zarate considered midnight deals for having been signed only four days before the “new and generous”

deadline set by the ERC. “This alleged questionable and corruption-laden transactions within the ERC even resulted in the unfortunate death of ERC Director Francisco Villa on November 9, 2016, who supposedly left handwritten suicide notes narrating the pressures he received to approve anomalous transactions,” Zarate added.

Salazar said this “erroneous insinuation merely prove that there are parties who are more than willing to use his death to suit their own agenda.”

“I appeal to these parties to refrain from capitalizing on the death of our colleague,” the ERC official added.

For Meralco’s part, its lawyer said the PSAs were not part of the matters being taken up by the bids and awards committee of the ERC, which actually deals with internal contracts and procurement at the ERC. Besides, the PSA applications of Meralco are still pending before the ERC. “It is therefore unfair and not truthful to insinuate any connection of these PSA applications to the current controversy at the ERC,” Meralco said.

This attempt is evident in the insinuation that the death of Director Villa may have also been precipitated by midnight deals allegedly linked between a large distribution utility and several power-generation companies.

This smacks of opportunism and a blatant attempt to ride on the death of our colleague to advance a parochial agenda.”—Salazar

Construction-material prices grew 2.3 percent in October–PSA

By Cai U. Ordinario

@cuo_bm

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etail prices of construction materials in Metro Manila posted its eighth consecutive month of growth in October, according to the Philippine Statistics Authority (PSA).

PSA data showed the Construction Materials Retail Price Index (CMRPI) in the National Capital Region (NCR) grew 2.3 percent in the last month.

In September the CMRPI increased by 2 percent, while in October 2015, it declined by 1.4 percent.

“The uptrend was primarily due to the double-digit annual gain of 11.4 percent posted in miscellaneous construction materials index,” the PSA said.

PSA data also showed there were increases in the prices of electrical materials at

1.5 percent; painting materials and related compounds, 1.6 percent; and tinsmithry materials, 1.1 percent.

However, the growth in the prices of masonry materials contracted to 2.9percent, while carpentry materials and plumbing materials moved at their previous month’s rates of 1.6 percent and 2.6 percent, respectively.

On a monthly basis, the CMRPI grew 0.1 percent in October 2016, from a contraction

of 0.1 percent in September 2016.

“Upward adjustments were registered in the prices of plywood, machine bolt and nuts, wiring devices, cement and hollow blocks, sand paper, faucet, GI [galvanized iron] pipes and steel bars,” the PSA said.

Data showed from negative rates recorded last month, prices of carpentry materials rose 0.1 percent and painting materials and related compounds, 0.2 percent.

Prices of electrical materials, likewise, went up by 0.2 percent. On the contrary, the increase in plumbing materials prices slowed down to 0.1 percent, while masonry materials and tinsmithry materials posted a flat growth in October 2016.

The CMRPI is a variant of the General Retail Price Index that measures the changes in the average retail prices of construction materials.

Neda prepares list of China-funded projects

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he National Economic and Development Authority (Neda) aims to submit a list of projects to be proposed for Chinese funding as early as next week.

At the sidelines of the Global Investment Forum on Wednesday, Neda Deputy Director General Rolando G. Tungpalan said the list will likely include not only those that were agreed upon in the recent state visit of the President to China, but also projects agreed upon in previous memoranda of understanding.

Tungpalan said the Neda has met with the Chinese delegation on Wednesday composed of representatives from China’s Ministry of Commerce (Mofcom), the National Development and Reform Commission (NDRC), and Chinese firms.

“We will be submitting in two weeks time or a weeks times an indicative list of projects for which we would like to work with China, including those that are requiring feasibility studies or capital assistance so even PPP [public-private

partnership],” the Neda official said.

This is now part of the tasks of the interagency Investment Coordination Committee (ICC), where Neda serves as the secretariat. The ICC has been tasked to clear all Chinese-related projects.

The list, Tungpalan said, will have to be approved by cochairs of the ICC, Finance Secretary Carlos G. Dominguez III and Socioeconomic Planning Secretary Ernesto M. Pernia, by early December 2016.

Once the list is approved, Tungpalan said it will be forwarded to the Chinese government. For projects involving feasibility studies, this will be followed by mobilization, while projects included in the list will have to go through the usual ICC process.

This involves appraisal by the funding agency, as well as the ICC Technical Board and Cabinet Committee (Cabcom). Once these appraisals are completed, that’s the only time the Philippines and Chinese governments will sign a loan agreement for a particular project.

Earlier, Pernia said the ICC Cabcom will be assigned to screen Chinese companies wanting to undertake publicly funded projects. This has already be included in a draft executive order awaiting the President’s signature.

Screening companies undertaking government projects is not part of the current functions of the ICC Cabcom. It is only tasked to evaluate publicly funded projects that cost P5 billion and up.

Pernia said the Chinese government will also create or assign its own group to act as the first level of screening for Chinese companies wanting to participate in Philippine projects.

The Chinese firms will be assessed based on certain qualifications, including their track record in undertaking projects and financial capability to complete a project.

The ICC Cabcom will screen Chinese companies only. Pernia said this is because the country does not have any “sour experience” with contractors of other nationalities.

Cai U. Ordinario

A4

Agriculture/Commodities

Thursday, November 24, 2016 • Editor: Jennifer A. Ng

BusinessMirror

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DA eyes 35% tariff on imported pork offal

By Jasper Emmanuel Y. Arcalas

T

@jearcalas

he Department of Agriculture (DA) said it will seek a 35-percent tariff on all pork products, including offal, to prevent technical smuggling and to boost government revenues.

Agriculture Secretary Emmanuel F. Piñol made the pronouncement, after the DA noted a “big discrepancy” in the meat-importation data of the United Nations and the Bureau of Animal Industry (BAI).

“The DA is forming a technical working group that will study this and will make recommendations. The data that I saw really showed that there’s technical smuggling,” Piñol said in a recent news briefing.

Piñol said the different data sets on meat importation showed that the discrepancy leans toward a bigger volume of offal rather than good meat, which would indicate there was technical smuggling.

He added that meat smugglers tend to misdeclare imported meat products to avoid paying the 35-percent tariff on pork. Imported offal is slapped a tariff of only 5 percent.

“To address this, once and for all, we will consider the cancellation of special tariff on offal, and

impose uniform 35-percent tariff on all meat products imported to the country,” Piñol said.

Economist Pablito M. Villegas, president and CEO of Meganomics Specialists Inc., an agricultural think tank, said the proposal of the DA to increase the pork-offal tariff to 35 percent is a “logical move”.

“From a revenue-generation view point, you prevent smuggling and, at the same time, you increase revenue collection,” Villegas told the BusinessMirror on Wednesday.

“Also, that is good, because once you increase the tariff, you encourage and make the local industry more competitive,” Villegas added.

He said the increase in tariff would force meat processors to buy pork offal from local hog raisers than import from other countries. “[The increase in tariff] will result in a win-win situation. What’s important here is the social good, who will benefit the most,” Villegas added.

Earlier, pork growers belonging

to the Pork Producers Federation of the Philippines Inc. (ProPork) urged the government to bring back the 40-percent tariff on imported pork-offal if it decides to scrap the quantitative restriction (QR) on rice next year.

ProPork noted that the reduction of pork-offal tariff was one of the concessions made by the government to allow the extension of the rice-import quota in 2014.

“The issue right now is our tariffication. Our tariff on pork fat, offal and skin is only 5 percent to 10 percent, because it was affected by the [rice] QR extension,” ProPork President Edwin Chen said.

Local traders are allowed by the government to import meat products under the minimum access volume scheme (MAV) of the World Trade Organization.

Meat imports within the MAV are slapped a 30-percent tariff, while those outside of MAV are levied a 40-percent tariff.

The Philippines slaps a tariff ranging from 5 percent to 10 percent on pork offal, according to the Tariff Commission. Pork offal comprises pig parts, such as ears, feet, tails, hearts, tongues, thick skirts, thin skirts, cauls, throats, thymus glands, kidneys, lungs, brains, pancreas, spleens, spinal cords and other parts discarded after the processing of meat cuts.

From January to August, the country imported 76,732.777 metric tons (MT) of pork offal, 15.31 percent higher than the 66,544.216 MT recorded a year ago.

Carla Gottgens/Bloomberg

‘Congress keen on amending NIA charter to remove irrigation fees’

C

ongress has started consolidating bills that would amend the charter of the National Irrigation Administration (NIA) to institutionalize the government’s free irrigation program, according to Agriculture Secretary Emmanuel F. Piñol.

Piñol said amending the NIA charter would ensure that the national government would no longer have to ask Congress for additional subsidy to provide free irrigation to farmers.

“Right now our free irrigation is only happening because the government provides a subsidy of P2 billion. The problem is that we cannot always ask for a special budget,” he told reporters on the sidelines of a news briefing on Tuesday.

“So our senators and congressmen want to amend the charter of the NIA in order to remove the irrigation service fees [ISF],” Piñol

said, adding that the process of amendment has started during the committee hearing of the House Committee on Rural Development on Monday.

Under the NIA charter, the agency is mandated to collect ISFs from farmers as payment for irrigation water delivered by the agency. The agency attached to the Office of the President uses the money for the operation and maintenance of irrigation systems in the country.

Currently, more than 15 bills seeking to amend the NIA charter have been filed in Congress.

Some of these are House Bill (HB) 37, authored by former Agriculture Secretary Arthur Yap, which aims to set up a free irrigation program; and HBs 189, 294 and 526, which seek to abolish the ISFs imposed by the NIA. Earlier, Undersecretary Maia Chiara Halmen Reina A. Val-

dez of the Office of the Cabinet Secretary has said an amendment of t he N I A c h a r ter i s needed to stop the agency from collecting ISFs. In October the Senate Committee on Finance approved the additional P2.3-billion budget for the NIA in order to subsidize the ISF collection for 2017. However, the amount was P1.7 billion short of the P4-billion allocation that Piñol said the Senate Committee on Finance, chaired by Sen. Loren B. Legarda, has pledged to set aside as subsidy for ISFs. The additional allocation is on top of the P36.36-billion budget of the agency under the proposed General Appropriations Act of 2017. The amount is enough to fund the salaries and expenses of employees in the NIA and irrigators’ associations, as well as the maintenance of existing irrigation facilities. Jasper Emmanuel Y. Arcalas

Residents of Maguindanao town turn swamp into productive tilapia farm

By Manuel T. Cayon Mindanao Bureau Chief

S

ULTAN MASTURA, Maguindanao—Residents of a former guerrilla mass base outside of this city have turned an unproductive grass-filled swamp into a profitable freshwater, fish pond, which currently supplies fingerlings to other communities in Mindanao.

Former beneficiaries of tilapiaproduction ponds in Sultan Mastura town in Maguindanao, about 20 kilometers north of Cotabato City, are also being tapped to train other starter organizations in freshwater fish-pond production in the region.

Adan Phari, president of the Lake Tumingay United Aqua Farmers Association of Barangay Tapayan; and Tinga A. Panansaran, president of the Tereken Aquaculture Producer Cooperative in Barangay Tambo in Sultan Mastura, said their members not only earn from selling adult tilapia but also from fingerlings.

Panansaran, for instance, was recently paid P21,000 after supplying 21,000 fingerlings to one cultivator, and has a current order for another 10,000 fingerlings from the Bureau of Fisheries and Aquatic Resources in Central Min-

danao. Tilapia cultivators here sell each fingerling at P1.

Phari said his group sold 387 kg of adult tilapia at P141.20 per kg in April. Each of the 15 memberfamilies took home an additional income of P1,000.

Before the project took off in 2013, local residents here used to an average of P2,500, but many have to make do with a much smaller amount from gathering coconuts and fishing tilapia at the swamp.

The tilapia-production initiative involving 20 member-families was piloted in Panansaran’s barangay Tambo. Prior to the rollout of the project, the two groups usually bought fingerlings from the University of Southern Mindanao in Kabacan, North Cotabato.

“Supply is not available all the time, and especially when we need them. So we decided to cultivate our own fingerlings,” Phari said.

The association supplies the requirements of members in the town, as well as those in other fishpond operators in the Bangsamoro area via four hatcheries.

Many barangays in Sultan Mastura are known bailiwicks of the Moro Islamic Liberation Front (MILF), which entered into peace negotiation with the government in 1997.

While the MILF signed a peace settlement with the government, its combatants and families continue to live below the poverty line. Conflict-ridden provinces in the Autonomous Region in Muslim Mindanao (ARMM) are some of the poorest provinces in the country.

The ARMM is composed of the central Mindanao provinces of Maguindanao and Lanao del Sur and the sourthwestern islandprovinces of Basilan, Sulu and Tawi-Tawi.

Jama lud in Sampu lna, a Bangsamoro Development Agency (BDA) volunteer for fisheries, said the BDA has a lot of capacity building and values reeducation trainings to conduct to change the attitude of residents.

“In the past, they do not value the projects and would not take care of them after receiving support. Equipment would be sold, and even the barangay officials would hold them in the barangay hall before selling them,” Sampulna said.

In 2012 the Japan International Cooperation Agency linked up with the BDA to seek out projects worth cultivating for residents in conflict-affected areas in central Mindanao. Sampulna said Sultan Mastura swamps were deemed suitable for aquaculture.

Asean

BusinessMirror

www.businessmirror.com.ph

Asean integration –at the end of 2016 Asean-EU Perspective

HENRY J. SCHUMACHER

Editor: Max V. de Leon • Thursday, November 24, 2016 A5

Junta’s populism flip-flop too late for Thai farmers

isn’t enough to pay debts. When I talk with farmer friends we grieve about the price slump and we want Yingluck to lead the government.”

The rice-price slump has spawned a public-relations battle between the generals and ousted politicians who are banned from campaigning as part of wider restrictions on speech and assembly. Yingluck has bought rice from northeastern farmers and sold it at Bangkok shopping malls, while the military has sent soldiers to the countryside to help some farmers harvest rice—with photographers and promotional banners in tow.

Since seizing power, junta leader Prayuth has repeatedly warned that farmers cannot rely on government price subsidies, and has encouraged moves to switch to other crops and improve overall quality. It is a plan Prayuth acknowledged could take 10 to 20 years to implement.

T

he launch of the Asean Economic Community (AEC) in December 2015 was a milestone for Asean economic integration, which is, however, an ongoing process. The AEC includes 10 of the fastest-growing economies globally, with an average growth rate of over 5 percent in the past years, and as a group represents the seventh-largest economy globally. High GDP growth in Asean member-states, combined with a dynamic demographic and increasingly skilled work force, currently renders Asean one of the most attractive investment and trade destinations for European business. The change in investment trends seen in the past years, with many manufacturers closing down operations in China and relocating to Asean, is evidence of the increasing opportunities the region has to offer.

Therefore, the integration and facilitation of intra-Asean movement of goods and people that the AEC envisions and the subsequent interconnection of 10 high-growth, high-potential markets is seen as a unique chance for business to capitalize on the opportunities that a fast-growing market of approximately 630 million people has to offer. Similarly, there is much to be gained by national economies within Asean from increased intra-Asean trade and investment, including intensified economic growth, employment generation and the creation of regional value chains. Taking into consideration that only 24 percent of trade registered by Asean member-states is currently intra-Asean, there is much scope for developing intra-Asean business and setting up regional hubs that can serve the Asean market. European Union (EU)-Asean Trade and Investment relations are already well established. Asean is the EU’s third-largest trade partner outside of Europe and the EU is Asean’s second-largest trading partner after China. Therefore, the EU business community in Europe and in the Philippines recognizes the great benefits and importance of further integrating the region and intensifying cross-border trade and investment both within Asean borders and between Asean and the EU. Taking into consideration that the Philippines will be chairing Asean in 2017, we believe it is an excellent opportunity for the Philippines to lead the way toward further Asean economic integration.

Trade facilitation

While almost all products in the region are now traded tariff-free, or with a tariff in the range of 0 percent to 5 percent, nontariff barriers to trade still remain an important impediment to intra-Asean trade for many products. Therefore, it is important that nontariff barriers, especially the Rules of Origin, product standards and testing, are addressed through deeper harmonization between member-states.

We strongly support the alignment of regulatory processes and the adoption of Mutual Recognition Agreements with other Asean member-states on standards and testing for key industries, such as health care, food and beverage and automotive. The cosmetics sector stands as a best practice for the harmonization of standards in the above-mentioned sectors. Specifically, Asean standards were adopted and implemented in the Philippines through the Adoption of the Association of Southeast Asian Nations Harmonized Cosmetic Regulatory Scheme and Asean Common Technical Documents” (Food and Drug Administration [FDA] Administrative Order [AO] 2005-0015) and the “Implementation of the Asean Harmonized Cosmetic Regulatory Scheme and Asean Common Technical Documents” (FDA AO 2005-0025).

In focus: Automotive

The automotive sector, including vehicles and parts, currently incurs major nontariff barriers in the Philippines and the region, due to the lack of alignment in product standards. We strongly recommend to the Philippines to grasp the opportunity as Asean chair in 2017 to fully align national standards and the approval process to the United Nations Economic Commission for Europe (Unece) regulations (currently, while the Department of Trade and Industry-Bureau of Product Standards has harmonized certain PNS standards to Unece vehicle regulations, there remain vehicle parts for which standards have not yet been harmonized). The Philippines should lead the way for the adoption of a mutual recognition agreement in automotive standards across Asean in support of establishing common recognition of standards that are aligned to Unece standards. It is worth noting that certain Asean member-states already recognize Unece standards for automotive parts.

Implement an Asean Single Window

Rapid implementation of a fully functional Asean Single Window will increase cross-border, intra-Asean trade, and ultimately contribute to economic growth and regional integration. Imperative to the Philippines’s participation in an Asean Single Window is first the establishment of a comprehensive, dynamic, online National Single Window.

Ease existing Customs procedures across Asean to ease intra-Asean trade

There are numerous operational and procedural obstacles within Customs procedures across Asean member-states that handicap intra-Asean trade. We believe that as chair of Asean, the Philippines should drive intra-Asean coordination on Customs procedures to reduce operational bottlenecks, such as the acceleration of the implementation of the Asean Customs Transit system and the adoption of electronic data interchange for customs declaration and clearance. The recent enactment of the CMTA in the Philippines includes best practices, in line with the WTO Trade Facilitation Agreement and WCO Revised Kyoto Protocol, which could be adopted across Asean in support of trade facilitation.

Protect IPR and clamp down on illicit trade

The single market offers increased opportunities for intra-Asean trade in illicit and counterfeit goods. The institutionalization of cooperation across Asean member-states to protect IPR is thus an important element to the success of the AEC in facilitating intra-Asean trade and investment.

Implement regional harmonization of standards and regulations

IN addition to the benefits on trade facilitation, the mutual recognition and adoption of common standards and regulations across Asean is important for investment facilitation. The development and strengthening of regional value chains is dependent on common standards between countries. The Asean Harmonized Cosmetic Regulatory scheme should serve as a best practice.

Ease long-term investment constraints

Asean member-states need to collectively address investors’ concerns by agreeing on measures in support of long-term intra-Asean investments. One option could be to build upon the agreement reached by Singapore, Malaysia and Thailand to facilitate more cross-border fund-raising, cross-border product distribution, cross-border investment and to facilitate market access by intermediaries.

A Thai Farmer rests on top of sacks of paddy rice.

E

ach slash of Chawieng Kaewkam’s sickle through his rice stalks is a reminder of how tough life has become for millions of Thai farmers, who have watched grain prices tumble near the lowest point in a decade.

Chawieng can no longer afford to rent a machine to harvest his three acres of paddy in northeastern Ubon Ratchathani province, and must cut everything by hand with the help of his wife and daughter. The current market price of 8,039 baht ($227) a ton for fragrant rice is about 60 percent below the guaranteed rate offered by former Prime Minister Yingluck Shinawatra, whose government was ousted in a 2014 coup.

“At this price, we can’t survive,” the 56-year-old said, adding that even side jobs he used to take in the local construction industry have dried up.

“I feel hopeless and depressed,” he said. “If things remain bad, I might have to sell land to pay for debts.”

Farmers like Chawieng are emblematic of wider economic woes in northeast Thailand that have the nation’s military rulers anxious as they weigh holding an election next year. That now has the junta embracing similar price support for farmers that they vilified when they seized power.

Over the past decade, Thailand’s generals repeatedly struggled to convince voters in the poorer and more populous northeast region to abandon support for allies of Yingluck and her brother Thaksin Shinawatra, who have won the past five elections dating back to 2001.

Rice prices are a big reason for that. While agriculture accounts for

about 8 percent of Thailand’s economy, rice farming employs 16 million people—roughly a quarter of the population. When prices fall it affects the wider economy, depressing purchases of everything from property to motorcycles to consumer goods.

“Finding a quick and easy solution for rice farmers has become a proxy electoral campaign issue even though a date has not been set for a poll,” said Ambika Ahuja, an analyst with Eurasia Group. “We have the government, political parties, and activist groups reaching out to farmers and providing ad hoc solutions. But these solutions are broadly similar to the extent that they are one form of subsidy or another.”

$1-billion bill

Yingluck’s government offered to buy paddy from farmers at levels that were sometimes 50 percent more than market prices, leading to outlays of about $25 billion over more than two years. That led to a 20-percent jump in rice production and a record stockpile of 17.8 million metric tons stored in governmentrun warehouses.

Junta leader Prayuth Chan-ocha’s administration called the policy unsustainable, and struggled to sell off the stored rice. It also brought malfeasance charges against Yingluck, and last month slapped her

16M

Thailand’s ricefarming population

with a $1-billion bill—even though it hasn’t provided an estimate for total losses from the program. A few weeks later, Prayuth did an aboutface and announced his own plan to spend 78 billion baht ($2.2 billion) shoring up prices and subsidizing production costs. Under the policy, the government would offer farmers 90 percent of the market price plus storage fees if they hold the rice for five months. Afterward they could either sell at market rates and pay back the loan, or surrender the harvest to the government.

In another populist move, the military government on Tuesday announced a onetime cash handout of as much as 3,000 baht to help 5.4 million low-income earners.

In Ubon Ratchatani, a province bordering Cambodia and Laos that has reliably backed the Shinawatra family in elections, farmers say the military’s rice program is better than nothing but ultimately too little, too late. They say the new system is too complicated, takes too long to join and requires them to take on the risk of storing their rice.

‘We want Yingluck’

“During Yingluck’s government, prices were good and farmer’s lives were much better,” said Kangwan Bunprachom, 40, after he sold 3 tons of rice at a mill rather than save it for the government program.

“What I earn from selling rice now

Distorting prices

“Farmers need to change their methods,” Prayuth told reporters on November 18. “They can’t just wait for a new government to sell rice at a satisfactory level and avoid thinking about the burden that will fall on others.”

In Ubon Ratchathani, that argument has some support. Boohieng Rungrachkanont said only one of his three rice mills will turn a profit this year. He blames the falling prices on the huge stockpile amassed under Yingluck’s program, and says the current government’s plan to avoid setting a minimum price “helps farmers without distorting market prices.”

Outside of the agricultural sector, the price drop is also having an impact. Sales have dropped 6 percent this year at Paiboon Jongsuwat’s 165 7-Eleven stores across four northeastern provinces. Paiboon attributes the drop to the fall in crop prices, and he doesn’t see this government coming up with a solution.

“I’m worried that if the rice price remains low, the situation next year could be worse,” said Paiboon, the managing director of Yingyong Minimart Ltd. “One of the ways to help stimulate the economy is to make the rice price at a good level, helping farmers to earn some profits.

Then they have money to spend and money will circulate in the system.”

Also feeling the impact has been Kittisak Kiatsuranon, CEO of Kitcharoenthaiubon, a distributor of motorcycles with 27 branches in two northeastern provinces. His company’s income has been cut in half over the past five years, largely due to plummeting sales of small-sized motorcycles popular with farmers.

Some 20 percent of 10,000 customers who financed their purchases are now behind on payments.

Bloomberg News

Asia’s worst currency slump puts Malaysia central bank on guard

A

sia’s worst-performing currency since Donald Trump’s surprise US election victory is putting a Malaysian interest-rate cut out of sight for now.

After surprising the market with a reduction in July, economists surveyed by Bloomberg in the days leading up to the US vote had forecast another cut this year.

Trump’s win and the ensuing US dollar rally have swept those bets away, with all 19 economists polled in a fresh survey predicting Bank Negara Malaysia (BNM) will hold the overnight policy rate at 3 percent on Wednesday.

The ringgit has fallen more than

5 percent since the November 8 US elections, as emerging Asian economies suffered about $11 billion of outflows. Bank Negara’s attempt to stop foreign banks from using offshore forwards to bet against the currency exacerbated the decline, as it evoked fears of capital controls imposed during the Asian financial crisis in 1998.

“Given the currency weakness and also potentially an uptick in inflation next year, the room for deeper rate cuts is slimmer,” said Julia Goh, an economist with United Overseas Bank Ltd. in Kuala Lumpur. “The volatile ringgit and the dollar’s strength complicate matters.”

Former powerhouse

Once among Southeast Asia’s powerhouses, Malaysia’s economy is faltering, with the World Bank forecasting growth of less than 5 percent from 2016 to 2018. The economy expanded 4.3 percent last quarter from a year earlier. The depreciating ringgit in part has prompted analysts at ING Groep NV and Nomura Holdings Inc. to change their forecasts, expecting the central bank to stand pat at its last policy meeting this year, from an earlier projection of a reduction. UOB’s Goh predicts policy-makers will resume cutting rates in the first half of 2017.

Other central banks in the region

are also holding off from adding stimulus, with Indonesia last week keeping its benchmark rate unchanged after six cuts this year. The Malaysian currency fell for 10 straight days through Tuesday and was trading at the lowest level since October 2015.

Inflation is projected by the government to average between 2 percent and 3 percent next year, compared with 2 percent to 2.5 percent this year. “With BNM stepping up rhetoric against speculation on the ringgit, the focus is now firmly on currency stability with growth/inflation dynamics taking a backseat for now,” DBS Group Holdings Ltd. said in a note this week. Bloomberg News

TheBroa

Business

A6 Thursday, November 24, 2016

Phuongphoto | Dreamstime.com

Rail transportat by obsolete polic

B

By Lorenz S. Marasigan

ECAUSE the Philippines is a laggard in railway infrastructure development in the region, the Duterte administration has grown obsessed in building a number of train networks across the country to enhance connectivity among provinces and cities.

Transportation Assistant Secretary for Rails Cesar B. Chavez admitted that the new administration is disappointed with the more than one-decade dry spell in railway development in the Philippines.

This sentiment comes from the sad reality that, while the Philippines was the first Southeast Asian nation to build an overhead railway system, it is also one of the countries in the economic area where mass transportation is inadequate.

“The land area in Metro Manila is almost similar to Jakarta, Seoul, Mumbai and Cairo,” Chavez said.

“The population in Metro Manila is almost the same with Jakarta and Seoul at 10 million to 12 million.

But when it comes to railway networks, theirs is about 500 kilometers to 1,000 kilometers and ours is about 70 kilometers.”

Data from the transportation department showed that the Philippines only has 79 kilometers of rails today.

Constant underspending

THE Philippine rail sector has been dragged by constant underspending for more than a decade now.

Thailand, Indonesia and Vietnam have earmarked billions of dollars

to improve their rail network.

Hanoi, Vietnam, in particular, only started the development of its railway network in 2012 and is envisioned to have 54 kilometers of rails in three years’ time.

Jakarta is set to have a rail network of 108 kilometers by 2018.

Thailand, on the other hand, already has a robust 4,346 kilometers of rail network. It has planned to add 56.5 kilometers of additional rail links in the next few years.

According to Chavez, this apparent government underinvestment in rails stems from wrong decisions and policies adopted by previous administrations.

“It’s a policy issue,” Chavez said. “Corruption only comes next.”

Bended policies

CORRUPTION, according to Chavez, is a byproduct of bended policies.

For example, the previous government decided to end the construction of the multibillionpeso North Rail—an 80-kilometer railway line that was envisioned to run from Caloocan to Malolos and Clark Field—due to issues of corruption.

China National Machinery and Equipment Corp. had already built guideways in Malabon and Bulacan, when the Aquino administration ordered the cancellation

of the $593-million contract for North Rail mired with legal cases.

“The problem with railway development in our country is policy based,” Chavez said. “The previous administration have been implementing wrong policies.”

He also pointed out that the sorry state of the Light Rail Transit (LRT) Lines 1 and 2, the Metro Rail Transit (MRT) and the Philippine National Railways (PNR) could also be blamed to wrong policies.

Wrong procurement

THE four train lines operating today that, according to BusinessMirror estimates, work at 58.75 percent, are not interconnected with each other—much less connected to other modes of transportation.

“The previous government, for example, allowed a contractor for a contract of six months for the maintenance of the MRT 3. Given that timeline, the contractor will not have the capacity to invest in spare parts. Hence, without spare parts, the maintenance of the train system is, in effect, jeopardized,” Chavez said.

“It’s a wrong procurement.”

He added that, while the Aquino administration jump-started the acquisition of 48 new train cars for the Edsa line, it forgot to

include in the contract the provision for onboard signaling system for the light-rail vehicles.

Hence, the cars that were already delivered by Dalian Locomotive and Rolling Stocks of China were left warehoused in the train line’s depot.

“They also forgot to take into consideration the capacity of the whole system in terms of power,” Chavez said. “It has the capacity to run with 23 to 24 train sets at a certain period. But with the new trains, which we plan to use to modify the sets from three cars to four, we may need to increase the power capacity of the MRT 3.”

“In Mindanao alone, there are about 1,533 kilometers worth of rails to develop,” Chavez said. “The dream for Mindanao is to have a railway line that will run from Cagayan de Oro to Davao City.”

The Mindanao railway project will be done in three phases—divided into so-called corridors.

Corridor 1 will be from Cagayan de Oro to Butuan. The second corridor will run from Butuan to Davao City, while the third corridor will be the loop to Cagayan de Oro from the city of Davao.

“The policy there is the train will cover six different regions,” Chavez said.

Mindanao railway

Foreign investors

MODERNIZING and improving the existing railway lines are not the only ones on the list of the Duterte administration, Chavez said, it involves billions of pesos in investments stretched beyond the term of the newly elected president.

This includes the construction of the East-West Line, which will run from Commonwealth to Quiapo. There is also a plan to build a railway that will run from Malolos to Clark and another one from Solis to Los Baños. Another plan is the Mindanao Railway, among others.

AS early as now, Chavez said the government has received an overwhelming support from foreign investors, particularly from Japan and China.

“The Chinese and Japanese are competing for railway deals,” Chavez added. “The Japanese want to conduct a feasibility study for the railway from Malolos to Clark. They want to develop the said railway. China is also interested in that project.”

The official explained that there are two ways by which the government could develop rail infrastructure in the country: one is through

aderLook tion sidetracked cies, corruption

sMirror

www.businessmirror.com.ph | Thursday, November 24, 2016

A7

Based on the Magna Carta for PWDs, specifically Section 5 of Republic Act 7277, government agencies and corporations should reserve 5 percent of their work force for PWDs. However, Civil Service Commission Chairman Francisco T. Duque III issued Memorandum 7, series of 2014, which brought down this number to 1 percent.

Joyfull | Dreamstime.com

SANCHEZ: “Wala, walang regular income. Alam mo namang ang disability is associated [with] poverty. Eh konti lang naman ang mga mayayaman na PWDs.”

the Public-Private Partnership (PPP) Program, and by getting investors from other countries.

“PPP is the way to go. We have many proponents from South Korea, Japan and China,” he said.

“The policy is there should be no sovereign guarantee, and the government will not give out subsidy.”

The government is also open to unsolicited proposals, which are projects not included in the state’s pipeline of deals, but are offered by the private sector for implementation. Such projects were previously shunned by the previous government because of the lengthy process of competitive challenge, and to dodge issues of corruption.

But all these plans, according to rail expert Rene S. Santiago, may only prove to be a problem if the government will not deliver as it has promised.

“The previous administrations have tried to increase allocations to infrastructure. The obsession with railway is misplaced,” he told the BusinessMirror. “A railway in Mindanao will be an albatross on future Mindanao developments by sucking out funds from other sectors.”

He also foresees that the Mindanao Railway “will not be completed” during the term of President Duterte, given the short amount of time that he will serve as the country’s Chief Executive.

“By the end of Duterte’s term, I expect a lot of dissatisfaction in terms of nonaccomplishment of ambitious goals,” Santiago said.

The government is banking on Congress approval of the emergency powers to hasten the implementation of infrastructure projects in the next few years.

Junpinzon | Dreamstime.com

All these plans, according to rail expert Rene S. Santiago, may only prove to be a problem if the government will not deliver as it has promised.

“The previous administrations have tried to increase allocations to infrastructure. The obsession with railway is misplaced,” he told the BusinessMirror. “A railway in Mindanao will be an albatross on future Mindanao developments by sucking out funds from other sectors.”

A8

Thursday, November 24, 2016

The World BusinessMirror

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

Bouncing back? Putin’s shrunken economy lures foreign investors

E

ven before the US presidential election raised hopes of warmer ties with the Kremlin, some big Western companies were betting Russia’s economy would soon come out of the deep freeze.

Big retailers, like Sweden’s Ikea Group and France’s Leroy Merlin SA, have begun pumping billions of dollars in new stores and factories, counting on Russia’s consumers to start emerging from hibernation after two years of recession.

Ikea is putting $1.6 billion into new stores over the next five years or so. Leroy Merlin in September announced a €2-billion plan to more than double the number of outlets in Russia over the same period. Pfizer Inc. is building a new drug factory, while Mars Inc. is expanding plants for chewing gum and pet food.

“This is the moment for investment,” said Walter Kadnar, country head for Ikea, which last launched a new store in Russia five years ago, but this fall opened a $60-million furniture factory near Saint Petersburg and acquired land for a third Megamall near the city. “I strongly believe in the potential of the Russian market long term.”

Situation ‘changing’ Onlookers watch as President-elect Donald J. Trump shakes hands with a security guard as he leaves the New York Times building following a meeting on Tuesday in New York. AP/Mark Lennihan

Trump says he ‘can’t have a conflict of interest’ as prexy

P

resident-elect Donald J. Trump said a sitting US president “can’t have a conflict of interest”, responding to a surge of questions about whether his global business interests will collide with his official duties when he takes office in January.

Asked about potential business conflicts during an interview with the New York Times on Tuesday, Trump said federal law is “totally on my side.”

Federal law exempts presidents and vice presidents from some rules that ban officials from acting in ways that further their personal interests, an exception crafted out of the belief that presidents shouldn’t have to worry about triggering ethics probes when making hard decisions.

Trump’s statement “ is only partially true,” said Scott Amey, general counsel for the Project on Gover nment O versight, a nonpartisan watchdog group in Washington. “There are lots of conflict-of-interest laws that do apply to the president.”

He cited the emoluments clause of the US Constitution, which bans any government official from accepting gifts or payments from foreign governments, as well as laws that prohibit soliciting or accepting bribes.

Trump’s licensing deals and other business interests have drawn renewed scrutiny since he was elected president on November 8.

Recent media reports singled out his ties to a Philippine developer who has been appointed that nation’s envoy to the US; disclosed that Trump took a break from transition planning to meet with three business partners building Trumpbranded towers in India; and said that his daughter, Ivanka Trump, who will help run the family’s business during his administration,

$300M The amount of US Presidentelect Donald Trump’s debt with Deutsche Bank

sat in on a meeting with Japanese Prime Minister Shinzo Abe. “ We’re a lready seeing this blurred line between these operations and we’re only two weeks in,” Amey said. “We have a three-ring circus and they all overlap and Trump is in the middle of it all.”

Unique case

Trump’s comments, which were posted on Twitter by New York Times reporters, suggested that he’s at least mindful of the challenge his presidency presents in terms of his widespread business holdings.

“There’s never been a case like this,” he said.

But on Monday night, the president-elect dismissed concerns in his own Twitter posting: “Prior to the election it was well known that I have interests in properties all over the world. Only the crooked media makes this a big deal!”

Richard W. Painter, a professor of corporate law at the University of Minnesota, tried to illustrate the importance: What if Franklin Delano Roosevelt had tried to prosecute World War II while holding interests in real-estate projects in Berlin, or paying off loans from Deutsche Bank AG, he said in an interview.

(Deutsche Bank is Trump’s largest lender; it holds about $300 million in debt against his Trump International Hotel in Washington and his Trump National Doral golf resort near Miami.)

“A president of course can have a conflict of interest,” said Painter, who was President George W. Bush’s chief ethics lawyer. Just because particular rules don’t apply, that doesn’t remove the conflict, he said.

Most modern presidents have taken steps to insulate themselves from conflicts with their business interests by placing their assets in blind trusts. That would be difficult for Trump, many of whose assets are in real estate, rather than stocks and bonds, while others—including licensing deals with developers around the world—depend on his involvement for their value.

Business management

Trump has, instead, said he will give his children, Ivanka, Donald Jr. and Eric Trump, management of his many business interests— an arrangement that ethics experts say won’t go far enough to remove conflicts. Painter suggested that Trump ought to take his businesses public and invest the cash he’d receive via a blind trust.

Unless or until he does, Trump has reason to be wary of another potential pitfall, Painter said: lawsuits. “If he insists on holding on to these businesses, they’re going to be litigation magnets for the plaintiffs’ bar,” which is sympathetic to Democrats and would be eager to take sworn testimony from Trump as president, he predicted.

Democrats in Congress were already calling for heightened scrutiny. Leading Democrats on the House Financial Ser vices Committee issued an open letter on Tuesday to inspectors general at eight federal agencies, citing Trump’s unprecedented “potential conf licts of interest” and seeking extra vigilance over his administration.

Highest standards

The letter, which was addressed

to inspectors at the Treasury Department, the Securities and Exchange Commission and other agencies, asked the watchdogs to hold Trump’s appointees to “the highest possible ethical standards” and “commit to diligently and constantly monitoring the actions of such appointees and mitigating conflicts of interest when they inevitably arise.”

It was signed by Rep. Maxine Waters of California, the panel’s top Democrat, along with Reps.

Carolyn Maloney of New York, William Lacy Clay of Missouri, Emanuel Cleaver of Missouri, Gwen Moore of Wisconsin and Al Green of Texas.

Sen. Ben Cardin of Maryland, the top Democrat on the Senate Foreign Relations Committee, plans to introduce a resolution next week, calling on Trump to “convert his assets to simple, conflict-free holdings, adopt blind trusts, or take other equivalent measures in order to ensure” he meets the Constitution’s emoluments clause, according to a news release from his office.

That clause provides that no officeholder “shall, without the consent of the Congress, accept any present, emolument, office or title, of any kind whatever, from any king, prince or foreign state.”

“Unless he takes appropriate action, Mr. Trump’s many international financial interests pose a great risk of violating the Constitution” once he takes office, Cardin said in the news release.

Not ever y ethics specialist agrees. Unless it can be shown that a foreign government is passing funds through a particular company to Trump, “I don’t think the emoluments clause would be implicated—it’s extremely remote,” said Robert Kelner, chairman of the election and political law practice at Covington and Burling Llp. “I will eat a bug if any court finds a violation of the emoluments clause for a relationship—even between a state-owned company and a private company owned by the president.” Bloomberg News

Foreign investment all but ground to a halt as the country sunk into recession and conflict with the West over the last two years. Companies, including General Motors Co. slashed local operations.

For many of those who stayed, now is the time to reopen their wallets to get a jump on rivals. The ruble’s plunge, though it decimated the value of local earnings in dollars and euros, has driven production costs in Russia down sharply. By some estimates, they’re now lower than those in China.

“The last two to three years have been a disaster,” said Frank Schauff, head of the Association of European Businesses in Moscow. “Now, the situation is changing as the ruble exchange rate has stabilized and the Russian economy is forecast to return to growth soon.”

The government said its annual meeting of foreign investors in September drew the most top executives in a decade. Foreign direct investment surged to $8.3 billion in the first nine months of this year, more than the $5.9 billion reported for all of 2015, according to central bank data.

That’s still far below the levels seen before the Ukraine crisis, which together with US and European Union sanctions and the plunge in oil prices and the ruble made many big companies reconsider investing.

Still, the rise in foreign investment is a modest bit of good news for the capitalstarved economy. Overall, businesses in Russia are still holding back on expansion, with capital investment down 2.3 percent in the first nine months of this year.

The government expects only a tepid recovery with growth of 0.8 percent next year. The middle class—the target market

for most big foreign investors—has shrunk by 14 million people over the last two years, according to Sberbank CIB, a local investment bank.

Geopolitics optimism

Alexis Rodzianko, president of the American Chamber of Commerce in Russia, said geopolitical tensions have been a big deterrent for potential foreign investors.

The election of Donald Trump, who praised President Vladimir Putin and questioned the sanctions during the campaign, could change that. “Trump has a more open mind regarding the US-Russia relationship,” Rodzianko said. “It’s clear there is room for improvement and that in itself is hopeful.”

For those companies not put off by the chilly political winds, adapting to the plunge in the ruble’s value—it’s down about 50 percent since the crisis began in early 2014—and the drop in Russians’ incomes has required some ingenuity.

Ikea is selling fewer big-ticket items like kitchens and more pots and gadgets for Russians who increasingly cook at home, because they can’t afford to go out. At the malls it owns, managers note the “lipstick effect”—makeup and lingerie stores are thriving as consumers treat themselves to lower-cost luxuries, while those that sell more costly clothes and shoes have seen sales plunge.

Ikea and the other big foreign players say their sales have actually gone up in ruble terms over the last two years. Overall, retail sales in Russia are down 5.3 percent this year, having dropped 10 percent in 2015.

“We are seeing signs of improvement,” PepsiCo Inc. CEOIndra Nooyi said in September.

Even after the plunge in the ruble, Russia remains the company’s thirdbiggest market after the US and Mexico.

The company expanded cheese output after the Kremlin cleared the market by banning most imports. This month, it announced plans for a new $40-million baby-food plant in southern Russia.

Ford Motor Co. said this month it sees signs of a rebound in car sales, which had been hit especially hard by the recession.

French do-it-yourself retailer Leroy Merlin says its same-store sales are up 5 percent in ruble terms as Russians turn to its low-cost products.

‘Long-term approach’

“We are taking a long-term approach, economic growth is set to return and we are already seeing some improvement,” said Country Head Vincent Gentil.

Foreign companies are also increasing local production to capitalize on the ruble’s drop. Ikea aims to bring the share of Russianproduced goods to 80 percent in the next few years and is already exporting Russian-made folding beds to China and linen curtains and wood furniture to Europe. Bloomberg News

Planes launched off US carrier in Gulf pound IS

A

BOARD THE USS EISENHOWER—One after another, fighter jets catapult from the flight deck of the USS Eisenhower, a 305-meter American aircraft carrier, afterburners glowing amber above the blue Persian Gulf, on their way northwest to join the fight in Iraq and Syria against the Islamic State (IS) group.

The fighter jets refuel on the way before receiving from coalition partners targets like convoys, hideouts and mortar positions in IS-controlled territories, such as Mosul in Iraq and Raqqa in Syria, said Rear Adm. James Malloy, commander of the Eisenhower carrier strike group. From his office aboard the USS Eisenhower, Malloy described coalition success around Mosul, while cautioning that victory is close at hand.

“Mosul is the last large city in Iraq that is held by Daesh, but Daesh is by no means finished in Iraq, so our mission in Iraq won’t end as Mosul falls,” he said, using the Arabic acronym for IS. While intercoalition coordination was “seamless”, communication with Russia was limited to “deconfliction”, Malloy said.

“There’s no coordination there because

the goals are not the same,” the admiral said.

The carrier’s captain Paul Spedero said sorties from the Eisenhower have dropped nearly 1,100 bombs on IS targets since June, when the ship entered the Persian Gulf after launching strikes from the eastern Mediterranean.

The ship’s 5,200 sailors arm, repair, launch and recover 7-20 Super Hornet F18 fighter jets every day that drop on average 10 bombs each or reconnoiter in support of anti-IS coalition forces.

The crew catapults the jets from the ship at 145 miles per hour (mph), and they use a hook and cable to rapidly catch the fighter jets on the 500-foot long carrier deck.

“For a catapult shot, if you think about a Porsche 911, zero to 60 mph in about 2.5 seconds, these aircraft will go from zero mph to 145 mph in 2.5 seconds,” said commander Jeremy Rifas, the carrier’s air boss, from inside the ship’s control tower overlooking launches.

The fighters on these sorties head north by northwest for an hour before refueling midair and then approaching coalition ground forces that provide the pilots with targets for airstrikes or reconnaissance. AP

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

The World BusinessMirror

Thursday, November 24, 2016

A9

Trump dumps pledge to prosecute Clinton; keep climate Paris accord

P

resident-elect Donald J. Trump signaled he has no intention to investigate or prosecute his campaign opponent Hillary Clinton over her use of private e-mail as secretary of state or her family’s foundation after he’s inaugurated in January.

“I don’t want to hurt the Clintons, I really don’t,” Trump told the New York Times in an interview at the paper’s offices on Tuesday.

“She went through a lot and suffered greatly in many ways.

“I think it would be very, very divisive for the country,” Trump said, according to tweets from the paper’s journalists. “My inclination would be for whatever power I have on the matter is to say, ‘let’s go forward.’ This has been looked at for so long, ad nauseam.”

A ba ndon i ng h is c a mpa ig n pledge to pursue Clinton as president is sure to disappoint some of Trump’s supporters. Chants of “ lock her up” resounded at his campaign rallies at any mention of his opponent’s name, and Trump told Clinton directly in a debate that if he were president, “you’d be in jail.”

The Breitbart News web site, which strongly backed Trump’s e le c t ion , p o s t e d a s tor y on Tuesday about earlier reports that he’d abandon a Clinton investigation with the headline: “Broken Promise.” Appear ing on MSNBC earlier on Tuesday, Trump’s campaign manager Kellyanne Conway didn’t dispute the networks’ report that Trump wouldn’t pursue investigations of C linton and sug gested he would discourage new congressional inquiries, as well.

When the president-elect, as head of the party, “tells you before he’s even inaugurated he doesn’t wish to pursue these charges, it sends a very strong message, tone and content, to the members,” Conway said. “I think Hillary Clinton still has to face the fact that a majority of Americans don’t find her to be honest or trustworthy, but if Donald Trump can help her heal, then perhaps that’s a good thing.”

In the interview with the Times, Trump also said:

Keep US in Paris climate accord

He would consider keeping the US in the Paris accord to reduce climate change negotiated by President Barack Obama last year.

“I’m looking at it very closely. I have an open mind to it,” Trump told the newspaper.

Trump extolled Obama, who met with him for about 90 minutes immediately after his election. The two have subsequently spoken by phone at least once.

“I think he’s looking to do absolutely the right thing for the country in terms of transition,” Trump said. “He said very nice things after the meeting and I said very nice things about him. I didn’t know if I’d like him. I probably thought that maybe I wouldn’t, but I did.

I really enjoyed him a lot.”

“He did tell me what he thought were the biggest problems, in particular one problem,” Trump said. He declined to elaborate, the Times said.

Defends Bannon

Trump defended Stephen Bannon, the former Breitbart executive chairman who helped run Trump’s campaign and will be Trump’s chief White House strategist.

Democrats have accused Bannon of fostering racism because Breitbart, under his leadership, published articles critics considered to be anti-Semitic, misogynist and racist.

“If I thought he was a racist or a lt-r ight or any of the things, the terms we could use, I wouldn’t even think about hiring him,” Tr ump said. Tr ump rejected suppor t from a white supremacist group that held a conference in Washington over the weekend, where attendees were record ing ma k ing Na zi

sa lutes a nd shout i ng , “Ha i l, Tr ump,” according to a v ideo published by the At lantic.

“I disavow and condemn them,” Trump said. He said New Hampshire Sen. Kelly Ayotte, a Republican who was defeated for reelection despite distancing herself from Trump, wouldn’t have a job in his administration.

“No, thank you,” he said. Trump said he is “seriously considering” retired Marine Corps General James Mattis for secretary of defense, and that he was surprised when Mattis told him he doesn’t support the use of waterboarding to interrogate captured terrorists.

Mattis would require an act by Congress to serve as defense secretary because he’s been retired from the military for less than seven years. Trump backed away from a campaign pledge to “open up” US libel law. Trump told the Times that someone told him, “‘You know, you might be sued a lot more.’ I said, ‘You know, I hadn’t thought of that.’”

Trump said he “would love to be the one who made peace with Israel and the Palestinians. That would be such a great achievement.” He suggested that his son-in-law, Jared Kushner, could negotiate peace between the two sides.

Clinton pursuit

After Trump’s November 8 election, the White House declined to rule out issuing a pardon to protect Clinton from prosecution by the incoming administration.

Trump ally Rudy Giuliani, a former New York City mayor and prosecutor who may join the next administration, said on November 10 Obama shouldn’t pardon Clinton and “should leave it to the system we all believe in.”

Giuliani told reporters in New York on Tuesday that if Trump has decided not to push for a Clinton prosecution, “that’s perfectly consistent” with historical patterns.

“I’d also be supportive of continuing the investigation. I think the president-elect had a tough choice there,” he said.

E x per t s i n con st it ut ion a l law said nothing would prohibit Trump, as president, from ordering his attorney general not to pursue an Clinton investigation.

“The power is there, no question,” Harvard Law School Prof.

Charles Fried said in an interview.

“It’s in the president. The attorney general works for the president.”

Fried served as US solicitor general, the government’s top courtroom lawyer, during President Ronald Reagan’s second term.

“I rather think it’s a good idea that we don’t have the business of pursuing the previous, defeated administration,” Fried said.

Agenda video

Late on Monday, Trump released a video outlining his agenda for “the first 100 days” of his presidency.

On “day one”, he said, he would take executive actions to withdraw from the Trans-Pacific Partnership trade deal, cancel “ jobkilling restrictions” on energy industries, and issue a rule requiring that “two old regulations” be withdrawn for every new one his administration issues.

He didn’t mention Clinton or other campaign promises in the video, such as a repeal of the Affordable Care Act, construction of a wall on the Mexican border, deporting undocumented immigrants and abandonment of the deal with Iran to curtail the country’s nuclear ambitions.

“My agenda will be based on a simple core principle: putting America first,” he said, whether it is “producing steel, building cars or curing disease.”

Trump continued his frenetic schedule of meetings on Tuesday with politicians, business leaders and other figures who are either counseling him or are under consideration for jobs in his administration. Bloomberg News

A protester holds signs against the Trans-Pacific Partnership (TPP) during a rally in Lima, Peru, on Friday. As leaders of the Asia-Pacific Economic Cooperation meet in Lima, dozens of people rallied against the TPP, a proposed trade agreement among twelve of the Pacific Rim countries, not including China. AP/Esteban Felix

As Trump kills TPP, China eyes December talks to fill trade void

E

ven before Donald J. Trump enters the White House and formally abandons a US-led trade deal that represented a cornerstone of his country’s economic policy in Asia, Chinese President Xi Jinping will get a chance to prove his willingness to step into the leadership vacuum.

The US withdrawal from the 12-nation Trans-Pacific Partnership (TPP)—reaffirmed by Trump in a videotaped speech on Monday—has focused attention on a competing set of trade talks planned for Indonesia next week.

The negotiations, which, unlike TPP, include China and not the US, aim to synchronize existing pacts across much of Asia and would cover 30 percent of the global economy and almost half the world’s population.

The proposed Regional Comprehensive Economic Partnership (RCEP) has become the next best hope for trade-hungry Asian nations after Trump’s surprise presidential win signaled a shift toward more protectionist policies in the US. Securing a deal would help cement China’s role as a geopolitical leader and further enmesh the world’s second-largest economy in the region.

“Unless the US steps up its economic game, all the countries of this region will be pulled into the orbit of China economically,” said Kishore Mahbubani, a former diplomat and now dean of the Lee Kuan Yew School of

12 The number of countries in the Trans-Pacific Partnership

Public Policy at the National University of Singapore. “As long as China becomes the economic center of gravity, its political inf luence will grow.”

The next round of RCEP talks will be held in Bumi Serpong Damai city, near Jakarta, from December 2 to 10.

Unlike TPP, which was sold

by US President Barack Obama, Japanese Prime Minister Shinzo Abe and other proponents as the prototype for a new generation of trade deals, RCEP doesn’t try to impose higher standards in areas, such as labor and environmental

protection. The 16-member pact would level tariffs and rules governing the region’s complicated supply chains, while improving market access and introducing dispute-resolution mechanisms.

The talks would amalgamate agreements already hashed out between the 10-member Association of Southeast Asian Nations (Asean) and Australia, China, India, Japan, South Korea and New Zealand.

China is the largest trading partner for most of the participants, a distinction it achieved with South Korea in 2003, Japa n i n 20 05, I nd i a i n 20 0 8 and Asean in 2009.

While free-trade advocates argue the two deals would compliment rather than conflict with each other, RCEP talks had taken a backseat as Obama promoted the TPP as a way to keep China from writing the rules of the global economy. Trump’s Democratic opponent, Hillary Clinton, had also opposed the TPP, but many expected the former secretary of state to revisit it in some form if she won the election.

Trump pledged to act on day one of his scheduled January 20 inauguration to withdraw the US from the TPP, which he called a “potential disaster for our country.”

He said he would pursue two-way trade deals instead.

Expand cooperation

Xi, meanwhile, reaffirmed China’s commitment to trade and said deals, such as RCEP, would help integrate his country into the global economy.

“We should deepen and expand cooperation in our region,” he said while attending the Asia-Pacific Economic Cooperation summit last weekend in Lima, Peru.

In talks in the Philippines just days before the US election, ministers from RCEP nations issued a statement that “underscored the urgency” of reaching a deal due to the “soft outlook for world trade growth and increasing protectionist sentiment.”

Getting an agreement would be significant win for China, said Jayant Menon, lead economist for trade and regional cooperation at the Asian Development Bank. “China will be seen as having secured the biggest deal in the world.”

Other deals

Progress on RCEP may advance other talks, such as a stalled effort for a three-way trade deal between China, Japan and South Korea, said Toshiki Takahashi, a senior researcher at the Institute for International Trade and Investment in Tokyo. RCEP “could be used as leverage.”

Huge obstacles remain. The TPP took seven years of negotiations before its signing in February. RCEP, which has been under discussion for three years, is complicated by special provisions to give countries, such as Cambodia and Myanmar, more time to bring tariffs into line.

India’s push to liberalize its services sector by negotiating access for globe-trotting professionals is another sticking point.

“The fact that it involves countries at different economic development levels already complicates the process,” said Kim Young-man, director of the East Asia free-trade agreement team at South Korea’s trade ministry. “We’ll have to try our best to get it done within the next year. But then again, it’s hard to predict.” Bloomberg News

Obama white-collar OT-pay expansion blocked by judge

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n Obama administration policy that would have given more white-collar workers overtime starting December 1 was blocked nationwide by a federal judge in Texas. The decision on Tuesday is a victory for 21 states and dozens of business groups that sued, complaining the new rule would increase government costs in their states by $115 million next year alone and would put private employers on the hook for millions of dollars more, possibly leading to layoffs.

It’s the fourth time in 21 months that a federal judge in Texas has issued a nationwide injunction blocking one of President Barack Obama’s executive orders.

The other Obama initiatives stymied in Texas courtrooms involved shielding

undocumented immigrants from deportation, mandating bathroom access for transgender students and requiring labor-violation disclosures by federal contractors. The rule would have doubled the maximum salary cap to $47,892 a year for full-time executive, administrative and professional workers to be exempt from overtime pay requirements.

The higher c utoff, along with a p ro v i s i o n t o p e r i o d i c a l l y i n c re a s e i t, wo u l d h ave ex te n d e d ove r t i m e protec tions to millions of full-time salaried workers, just 7 percent of whom are currently protected by the Fair Labor Standards Act compared with 62 percent in 1975, according to the government.

US District Judge Amos L. Mazzant III in

Sherman, Texas, rejected a request by the federal government to limit any order to the states that filed the lawsuit and issued a preliminary injunction blocking the new salary cutoff nationwide.

Congress’s intent

By requiring employers to pay overtime wages based on salary rather than an employee’s duties, the Labor Department exceeded its authority under the Fair Labor Standards Act and ignored Congress’s intent, Mazzant said in his ruling.

“If Congress intended the salar y requirement to supplant the duties test, then Congress and not the department, should make that change,” he said.

A hearing to consider making the

injunction permanent could follow, but Obama’s executive order could simply be reversed by the incoming Trump administration. In May Obama called the rule “the single biggest step I can take through executive action to raise wages for the American people.”The Labor Department said in an e-mailed statement that it was considering all of its legal options.

“We strongly disagree with the decision by the court, which has the effect of delaying a fair day’s pay for a long day’s work for millions of hardworking Americans,” according to the statement. “The department’s overtime rule is the result of a comprehensive, inclusive rulemaking process, and we remain confident in the legality of all aspects of the rule.”

Bloomberg News

A10 Thursday, November 24, 2016 • Editor: Angel R. Calso

Opinion BusinessMirror

editorial

Our shrinking English proficient work force

I

n this country of 7,100 islands where 170 living languages are spoken, it’s amazing how we became a bilingual nation, adopting both Filipino and English as official languages for communication and instruction. Filipinos can’t claim to be native English speakers as much as we would like to, but our work force can speak, write and read in this language better than our Asian neighbors. At least, that’s what we used to believe—that our proficiency in English is our biggest competitive advantage in the region.

There’s a consensus that our mastery of the English language has become our biggest edge in the global job market. That’s why we have a booming P25-billion business-process outsourcing (BPO) industry that employs more than a million Filipinos. The Board of Investments has been telling foreign investors about the country’s quality human resources: “Our people are highly educated. The Philippine literacy rate is 94 percent and 70 percent of the population are fluent in English.”

Unfortunately, this advantage is being eroded by rising competition from other Asian countries. A global English Proficiency Index released on November 15 by Education First (EF) Ltd. showed the declining mastery of the English language by our college graduates.

Sadly, Singapore and Malaysia overtook the Philippines in the latest English-proficiency ranking.

Based on test data from more than 950,000 adults from 72 countries who took the Lucerne, Switzerland-based firm’s online English tests in 2015, the Philippines was ranked 13th in the English Proficiency Index by EF Ltd. We scored an English Proficiency Index of 60.33, while Malaysia had a higher score of 60.70. Singapore was the big surprise, posting a very high English Proficiency Index score of 63.52. Of the 19 countries in Asia, only Singapore was included in the top 10, at No. 6 worldwide. “For the first time, an Asian country, Singapore, is in the highest-proficiency band,” said EF, a privately held firm founded in 1965 by Bertil Hult and family. It concluded: “Every country in Asia, no matter how skilled, would benefit economically from higher English proficiency across a broader swath of the work force. To achieve that goal, however, these countries must learn from one another, measure their efforts and adjust their strategies according to what has been proven to work.”

The Filipino work force is the country’s richest resource. Our ability to communicate in English is one reason Filipinos are very much sought after by foreign employers, particularly the BPO companies.

The decline in our English-proficiency level will have negative effects on our ability to compete in the global market. The whole country would suffer from a shrinking English-proficient work force, which would dissuade global companies from investing in the Philippines.

We cannot afford to lose our biggest competitive advantage. We need to relearn good English. The government and the private sector must work together to help address this problem before it gets worse. We need to improve our proficiency in English. We must dedicate resources and attention to restore the Philippines in its former glory. After all, from all indications, English will continue to be the official language of the global economy.

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BusinessMirror A broader look at today’s business ✝ Ambassador Antonio L. Cabangon Chua

Bewitched, bothered and bewildered John Mangun

OUTSIDE THE BOX

I

nvestors on the Philippine Stock Exchange (PSE) are all that; “Bewitched, bothered and bewildered”. This 1940 show tune about love—covered by almost every one from Frank Sinatra and Ella Fitzgerald to Rod Stewart and Lady Gaga—includes the lyrics “Burned a lot, but learned a lot”. That may also describe stock-market investors.

So what is going on with the local stock market that has “cast a spell” over participants who are bothered by falling prices and bewildered by the causes? Why are the “experts” desperate to find explanations?

The Manila Stock Exchange was founded in 1927. The PSE began in 1992. I am now calling 2016 as the year the “Filipino Stock Exchange” came into existence.

The PSE had a two-decade history of some glorious successes and some disastrous defeats. The 1989 coup attempt nearly destroyed the stock market, but it came back. Companies

with great prospects disappeared into dust because of bad management decisions. Others, facing catastrophe, took massive short-term losses to weather the storm for longterm victory.

But the local stock market that we had come to know and love and sometimes hate, in my opinion—for all intents and purposes—no longer exists. I believe we have entered a new era of the “Filipino Stock Exchange” (FSE).

Having traded this stock market since 1989, there were certain qualities and factors that you and I could

Where will President Duterte be?

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count on. Stock prices reacted to the economy and to growth and prosperity both higher and lower. The market looked to regional and mainly the US stock market for guidance. The PSE was 100 percent an “Old Boy’s Club,” not only in terms of the players but maybe, more important, in terms of the listed companies. There were the “Blue-Chip” household name companies, the “second-liners” and the “basura” stocks.

Gradually over a number of years, the stock market changed.

Online trading platforms changed both the players and the number of investors. Mutual-fund investments are no longer exclusively for the “rich” and have become part of the middle-class portfolio along with insurance. Companies listed on the exchange now include those from industries never before represented and are raising money for more “legitimate” purposes rather than putting money in the pockets of the members of family-owned corporations.

In the last two years and particularly in 2016, the changes became obvious. No longer would the market boom higher on good economic numbers. No longer did the Dow

database

W

ITH incoming US President Donald Trump’s protectionist policy and possibly making China a target of his government as a “currency manipulator” and blaming it for the closure of more than 50,000 factories and the loss of tens of thousands of American jobs, where will President Duterte be?

I asked this question because Duterte’s economic direction appears to be identical with Trump’s antifreetrade policy, but his administration this early is already inextricably linked with China, after it pledged a $24-billion economic package for the Philippines at the end of his state visit to that country last month.

The prestigious British newspaper Guardian reported that Trump “has argued for protectionism and asserted that decades of free-trade policies were responsible for the collapse of the American manufacturing industry.”

“He has been feeding on the perception among many Americans that globalization has brought more pain than gain, for example, by bringing cheap consumer goods into the

country, costing domestic jobs and depressing wages. Outsourcing of jobs to cheaper markets has also been a concern. Against that backdrop, Trump’s stance on trade is, perhaps, the clearest of his economic policies,” the Guardian said.

“Other global trade deals,” said the Guardian, “are also now very much in doubt, notably the TransPacific Partnership [TPP], among 12 countries around the Pacific rim, excluding China, and the agreement being negotiated between the US and Europe, known as the Transatlantic Trade and Investment Partnership [TTIP].”

“While we are minded to disregard some of Trump’s wilder preelection rhetoric, we consider that there is a tangible risk that a Trump

presidency could fuel anti-globalization momentum and spark a wave of protectionist policies around the globe. In terms of trade deals, both TTIP and the TPP now look dead in the water,” said Philip Shaw, an economist at the bank Investec.

Not so, as China, Reuters reported, is willing “to position itself as free trade’s new champion at an Asia-Pacific summit this weekend, with the Communist government seeking to project economic leadership as a US-led Pacific Rim trade pact languishes under Presidentelect Donald Trump.”

The Reuters report further said: “Beijing aims to capitalize on the Trump-induced coma of the TPP, with President Xi Jinping selling alternate visions for regional trade at the Asia-Pacific Economic Cooperation meeting this weekend in Peru.

“If the US gives up its leadership here, of course China will take the role,” said Tu Xinquan, a trade expert at Beijing’s University of International Business and Economics, who has advised China’s government on trade issues.

To answer the question—where will President Duterte be?—depends on his ability not to create enemies, form an economic team and draw up a strategic plan to rapidly turn the country into an industrial, manufacturing and

Jones movement determine where local stock prices would go. Investors became almost equally concerned and involved in companies where it is “Sarap to the bones” as the biggest bank in the Philippines.

Traders began looking at gaming, agriculture and package-delivery services. We can now buy shares of the company that provides supplies for the consumer product company and not just the consumer company itself. From the PSE that focused on the “oligarchic” companies, the new FSE most realistically represents the Philippine economy and wider business sectors.

But as different as the game and rules of American football and global football, so also are the PSE and FSE. What was a successful investment strategy on the PSE may not enjoy the same results on the FSE. However, as with any new venture—and the PSE is one—there will be a learning curve before being bothered and bewildered will pass.

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

commercial hub for East Asia and the Pacific Rim countries.

No other country has the same advantage as the Philippines in terms of the economy of distance and time: it propitiously lies at the center of the globe, six to 18 degrees above the equator between two of the world’s great oceans, the Pacific and the South China Sea, an interesting place for interactions on politics, economics, sociology, culture and national security, among others.

This means that with the country as a manufacturing and commercial hub, traders and investors will have ready access to more than one half of the world’s 7. 4 billion population in less than five hours by plane and 14 hours by ship, using Luzon, the Visayas and Mindanao as nerve centers. An access to a huge consumer base, isn’t it?

The Philippine is an archipelagic country with 7,107 islands, 300,000 square kilometers in depth and length, has 51 natural harbors, has maritime area five times bigger than its land area and is endowed with vast natural and human resources.

What we need though is less politics and more economics.

To reach the writer, e-mail cecilio.arillo@ gmail.com

opinion@businessmirror.com.ph

Opinion

To nuke or not to nuke

Stay awake!

BusinessMirror

Msgr. Sabino A. Vengco Jr.

Val A. Villanueva

Businesswise Conclusion

N

uclear energy remains to be the most viable option to combat climate change. It is clean. Its main appeal is that it has zero carbon emission, compared to other renewableenergy sources, such as wind and solar, which are still unable to offset the electricity-generating capacity of coal, hydro and diesel powered plants.

But even if the Philippines decides to have one, it would take years to build enough nuclear power plants to meet the country’s energy needs. It is also sure to meet stiff opposition from environmentalists, and the cost may not be palatable to taxpayers.

Time constraints and construction costs could be among the main reasons the Department of Energy (DOE) under the Duterte administration would want to recommit the Bataan Nuclear Power Plant (BNPP). Its basic structure, the DOE claims, remains solid, and it is still feasible to get it up and running.

The 620-megawatt BNPP would have been operated, if the plan had not been deferred, due to safety anxieties amid the nuclear fire at the Chernobyl power plant in Russia, by the late President Corazon C. Aquino who took power in 1986. Her administration also claimed that the BNPP was tainted with sleaze, what with the deposed President Ferdinand E. Marcos—through his crony Herminio Disini—receiving huge kickbacks from Westinghouse, which had won the contract to build the plant.

The DOE is currently proceeding with unified and coordinated efforts and activities with the creation of a Nuclear Energy Program Implementing Organization (Nepio).

The Nepio is headed by a Steering Committee with top DOE officials at the helm, while DOE bureaus will create technical working groups (TWGs) to ensure effective and timely implementation of its functions and responsibilities. Nuclear power may be clean, but people still question whether it is, or ever will be, safe enough.

Nuclear scientists believe that serious nuclear accidents are now fewer.

According to the US Nuclear Regulatory Commission (NRC), the rate of shutdown-the-reactor-level problems has dropped from 2.5 per plant per year to around 0.1 since the Three Mile Island in 1979, although one such incident happened on March 29 of this year in Richland, Washington.

Still, many people are terrified of another Three Mile Island, Fukushima, or Chernobyl accidents happening in our country. These disasters were the result of a meltdown, which occurs when something impedes a reactor’s ability to cool the fuel.

The disaster at Fukushima in 2011 was the most current of many grave accidents at nuclear power plants. And every year, multiple nuclear plants in the US go through incidents serious enough to prompt a special inspection by the NRC. Many of these episodes should have been

avoided, especially since they expose the public to delicate and pointless risks.

Geologist Kevin Rodolfo says an active earthquake fault in Pampanga province runs through Natib Volcano on which the BNPP sits. As such, he says, there is reason “beyond a doubt” to stop the activation of the BNPP. In an updated scientific review of “Geological Hazards of the Bataan Nuclear Plant: Propaganda and Scientific Fact,” a paper he wrote in July 2010, Rodolfo narrates that, along with Prof. Fernando Siringan and his students, they first noticed the Lubao Fault in 1997. At that time, they were studying the sinking of land off the coast of Bataan, Pampanga, Bulacan and Camanava (Caloocan, Malabon, Navotas and Valenzuela) areas.

A sharp lineament, the Lubao Fault “trends southwest to Mount Natib, where it abruptly disappears,” Rodolfo says. A lineament is a feature in a landscape expressing an underlying geological structure, similar to a fault.

Based on data from the US Geological Survey National Earthquake Information Center, many earthquakes occurred on Mount Natib between 1951 and 2016.

“Many of the earthquake epicenters plot along the Lubao lineament, which, if extended farther, trend to Napot Point,” the geologist says.

A group of scientists, headed by Prof.

Mahar Lagmay, used “sophisticated satellite data to show that the lineament is an active fault, and that its northwest side is moving slowly southward relative to the southeast side,” Rodolfo adds.

The group also determined that the rocks at Napot Point were deposits of pyroclastic flows and lahar, are a testimony to the susceptibility of the BNPP to those dangerous volcanic hazards.

Rodolfo emphasizes that the activation of the BNPP would be the “greatest threat to the well-being of the Filipino people and their environment.”

He said: “The natural dangers are being greatly compounded by nuclear proponents of great influence who know little geology. They select “facts” that defend the safety of the plant site and ignore “inconvenient” scientific truths that are easily available and verifiable.

This is not only dismissive of the dangers to the people; it is a great disrespect and disdain for natural-hazard science.”

Nuclear power could be the answer to climate change and the country’s dwindling energy sources. The risks it presents, however, seem far greater than its benefits.

For comments and suggestions, e-mail me at mvala.v@gmail.com

Alálaong Bagá

A

t the beginning of a new liturgical year and as we start again with Year A in the three-year cycle of our readings from Sacred Scripture, we are reminded of the imperative of repetition if we, human beings, are to grow and mature. The pedagogical necessity is clear not only in the emphasis we need in order to recognize and focus on what we should pay attention to, but also in our natural requirement, both bodily and spiritually, that we can take in only so much at any given time. Repetition contains the promise and the hope that the next time will be more fruitful and effective.

Opening the new liturgical year is the call once again to preparedness (Matthew 24:36-44).

As in days past IT can be said as characteristic of us that we get caught up in the everyday affairs of life. As in the days of Noah in the Old Testament story, people were “eating and drinking, marrying and giving in marriage”— all normal activities that can be all consuming. So much to do and there is not enough time to do them, we groan, with the result that one can be completely oblivious of other

matters of vital importance for one’s well-being. Something worldchanging happens like a daluyong that sweeps away everything on its path, and one is unprepared.

There is danger in allowing oneself to be so totally taken up by everyday things so as not to attend anymore to other extraordinary matters that one knows however would be taking place.

The critical need for the right

BLOOMBERG VIEW

F

inancial markets have been surging the past two weeks, anticipating the potential for more stimulative economic policy after the spate of recent antiestablishment political surprises.

Central bankers on both side of the Atlantic, while more restrained, also are preparing for measures that might produce both higher growth and faster inflation.

Following his election as US president, Donald Trump and his advisers have confirmed plans to move quickly on the pro-growth elements of his program, including higher infrastructure spending, deregulation and tax reform. At the

same time, he has downplayed the antitrade components, limiting his remarks so far to US disengagement from the yetto-be-ratified Trans-Pacific Partnership, rather than slapping on tariffs and dismantling existing arrangements, such

inner disposition is illustrated by the case of two persons doing exactly the same thing but one is ready and the other not. It is not asked that we cease and desist from our everyday life in order to be prepared.

One does not need to stop working and earn a living at the mill or in the field and be instead praying and in the temple, in order to be taken into God’s kingdom. We do not need to quit the tasks of everyday life and engage in exclusively religious activities, in order to qualify as ready for God. But one must be determined not let oneself to be surprised unprepared as if by something entirely unexpected. If you know a thief is planning to break into your house, you will get ready for it.

The Lord is coming

One thing is sure: the Day of the Lord, the time of His reign and the fulfilment of His will, is coming.

Even if we do not know the exact time of His coming—the Father alone knows—its importance for us all means that not to be ready for the Day of the Lord will have severe consequences. It entails judgment and, therefore, segregation. Those who have prepared for it by their faithfulness to Jesus Christ will

Why kill the goose that lays golden eggs?

million, followed by the US, with receipts amounting to P42.84 million; Japan, with P42.01 million recorded spending; Taiwan, with estimated receipts of P17.09 million; and Canada, with reported spending of about P14.29 million.

The country saw a 12.59-percent increase in the number of inbound tourists for the first eight months this year when 4,042,049 vacationers visited the country. This is 452,011 higher than last year’s 3,590,038 arrivals for the same period. The burgeoning number easily translated to P164.25 billion in total earnings from the travel and tourism industry.

booking that next trip to our luxurious tropical paradise.

Mother Nature has blessed us generously with natural splendor that is worth the appreciation and admiration of people around the globe.

Our Verde Island Passage, a strait that separates the islands of Luzon and Mindoro, connecting the South China Sea with the Tayabas Bay and the Sibuyan Sea beyond, is scientifically proven as the world’s epicenter of marine biodiversity. Our Taal Volcano is touted as the world’s “smallest” active volcano, curiously submerged in a lake. A Unesco World Heritage Site, our Palawan Underground River is listed on the elite New Seven Wonders of Nature roster.

Then, there’s the surreal experience of swimming with the butanding, or gentle giants of Donsol, also considered as the world’s Whale Shark Capital; the world-renowned powdery white-sand beaches of Boracay; the never-ending island- hopping, World War II sunken ships’ relic hunting, deep diving, or trouble-free snorkeling adventure in the spectacular limestone formed isles of Coron in Busuanga; then the imposing grandeur of the world’s perfectly coned Mayon Volcano; the captivating landscape of our Chocolate Hills; the stunning vista of sea of clouds on top of Mount Pulag, and the list goes on.

Natural wonders

Sustaining the growth

Ariel F. Nepomuceno

DECISION TIME

‘W

ith 7,000 tropical islands on my doorstep, all ripe for exploration, I find it easy to like the Philippines. Love, on the other hand, is borne of subtler things. Love is borne of long rooftop jeepney rides through the mountains of North Luzon; of a frosty San Miguel at sundown on a sublime slab of Visayan sand; of a fresh-fish lunch, followed by a siesta on an interminable banca journey through Palawan’s islands; of friends with names like Bing and Bong; of phrases like “comfort room”; of—dare I say it—karaoke. Now that is love.”

This is how Greg Bloom of popular online travel blog, lonelyplanet.com, put into words the reasons he loves the Philippines. And as of August this year, there are 502,739 tourists who probably share with him the same feelings.

According to the Department of Tourism’s (DOT) Industry Performance for Travel and Tourism, August 2016’s tourist arrivals in the country grew 4.59 percent, higher than the recorded 480,689 tourist arrivals in August 2015. Despite the rise, however, there was a dip in this year’s visitor expenditure receipts that translated to P15.69 billion.

This is 28.58 percent lower than August last year’s P21.97-billion earnings.

The statistics provided by DOT’s Economic Analysis and Information Management Division also revealed that Korea remains the top spending foreign market, with estimated expenditure of P102.88

A quick online search on why tourists visit the Philippines yielded about 28,600,000 results in 0.67 seconds. This only goes to show that, beyond the country’s sensational 7,107 islands, travelers will find millions of reasons more for

Central bankers hope Trump eases their burden Mohamed A. El-Erian

Thursday, November 24, 2016 A11

as the North American Free Trade Act. The Trump example is likely to be followed today by the UK. In the annual autumn statement, Philip Hammond, chancellor of the exchequer, is expected to outline a grand bargain between the new government and business aimed at promoting growth. It, too, would emphasize infrastructure spending, deregulation and tax reform.

Both these policy initiatives are a direct result of, and a reaction to, the populist wave roiling much of the Western world. It has already delivered surprise election victories for Brexit— the UK’s June referendum on leaving the European Union—and Presidentelect Trump; and in both cases, the governing executive party commands a legislative majority. Similar forces may play a role in Italy’s pending referendum on constitutional reforms, as well as next year’s French and German

elections—just to name a few. And ahead of all this, Germany has already hinted at a willingness to support less fiscal restraint in Europe.

This is challenging the long-held perception of an establishment stuck in political gridlock. One result of this paralysis has been the lack of a comprehensive policy response to economic weakness, while placing way too much of the burden for too long on central banks.

As a consequence, markets have rushed to price in the prospects for faster nominal GDP growth, taking all three major US stock markets to record highs. At the same time, interest rates have risen throughout the yield curve, increasing the probability that the Federal Reserve will raise rates in December.

Central bankers are also noting the potential change in economic outlook. This will come as a major relief to them, at least for now.

be taken into God’s kingdom, and those who have not will be left out.

The resounding injunction on us is “Stay awake!” We cannot plan to prepare for it at the last minute, for we do not know when the last minute is. We cannot say “wake me up when He is near,” because He is here already. Staying awake in a world of forgetfulness means constant attentiveness to Jesus, being guided by his gospel, and staying conscious of the spiritual dimension of life. We cannot just slide into a rut of being “so busy, yet so empty.” Neglect of the spirit is what undermines humankind.

Alálaong bagá, we are not supposed to be lost in the things of the world, and be emptied of Christian meaning and purpose, of the Spirit of Christ. Particularly in this Christmas season, we cannot as busy people becoming busier allow ourselves to “fall asleep” and be spiritually depleted: not longing anymore for the birth of Jesus in us and in our families but for the other “Christmas gifts” we truly await.

Join me in meditating on the Word of God every Sunday, 5 to 6 a.m. on dwIZ 882, or by audio-streaming on www.dwiz882.com.

eye-to-eye when it comes to the judicious use and management of the nation’s natural resources. The guiding principle must always be the long-term gain over short-lived return. After all, what we have in nature is literally all that we have got. We have but one Verde Island Passage, one Mount Mayon, one Tall Volcano, one Boracay, one Coron and so on. And we have lifetimes of generations to come for whom we must preserve and conserve these national treasures—not to forget, of course, the other nationalities who get to share with us the splendor of our landscapes and seascapes.

Simple economics dictate that consumption drives production.

This culture of consumerism makes it imperative for both public and private sectors to see to it that preservation and conservation steps are judiciously taken to protect our natural resources.

We are not lacking for environmental laws, but enforcement is an altogether different matter. Hence exploitative, negligent and greedy mismanagement of natural resources must be meted out with the strictest legal sanctions.

Like a goose that lay golden eggs, tourism brings in the buck to families, communities, regions and the entire nation. To enjoy its golden eggs for a long time, we have to nurture our natural resources that bring in the tourists to our country. After all, we already know the story’s horrific end: Greed killed the gold-laying bird. We can’t afford such foolishness in real life.

The challenge to make sure we nurture what nature has blessed us with solely rests upon our shoulders. The key to enduring, sustainable progress is collaboration.

It is important for both public and private sectors to always meet

For comments and suggestions arielnepo.businessmirror@gmail.com

During the past 12 months, a growing chorus of central bankers has spoken out against the only-game-in-town syndrome—that is, a policy stance that relies, too much on unconventional monetary policy, and whose potential collateral damage and unintended consequences should be taken more seriously. More and more they have spoken out on the need for pro-growth structural reforms and fiscal stimulus, where there is room.

As such, their welcoming of a more comprehensive policy response is both understandable and warranted. After all, the biggest challenge facing the West is to deliver faster and more inclusive growth, and not just for purposes of economic well-being, but also for institutional, political and social reasons.

Having said that, the caution of central bankers is warranted at this stage—and not just because that’s their

natural tendency. Political pronouncements need to be followed by carefully designed policies and sustained implementation. Otherwise, both the UK and the US could face the risk of exchanging a prolonged period of slow and inequitable growth for something even more painful—stagflation.

What will follow in the next few weeks is crucial, not only for central banks, but also to validate the recent market exuberance. The incoming Trump administration and the UK government of Theresa May need to deliver a specific set of measures that promotes nominal GDP, both actual and potential, through greater emphasis on growth relative to inflation. It’s a tricky policy maneuver, after a decade of inaction due to political polarization, and after the prolonged overreliance on private and then central bank financing as the fuel for growth.